m Un3%r ig$nduMtial V.\ ILLINOIS. BOOKS ARE NOT TO BE TAKEN FROM THE LIBRARY ROOM. Digitized by the Internet Archive in 2016 https://archive.org/details/reportoftariffco1188unit REPORT OF THE TARIFF COMMISSION, APPOINTED UNDER ACT OF CONGRESS APPROVED MAY 15, 1882. IN TWO VOLUMES. VOLUME I. WASHINGTON: GOVERNMENT PRINTING OFFICE. ERRATA. On page 10, next to last line in third paragraph, for “ each” read “finch.” On page 69, Schedule L — Silk and Silk Goods, first line, for “particularly” sub- stitute “partially.” On page 69, Schedule L — Silk and Silk Goods, in paragraph third of said sched- ule, for “dried” read “dyed.” On page 72, Schedule N — Sundries, after the paragraph commencing “ Osier” and before the paragraph commencing “ Papier-mache,” insert — Paintings, in oil or water-colors, and statuary, not otherwise provided for, forty per centum ad valorem. But the term “statuary,” as used in the laws now in force im- posing duties on foreign importations, shall be understood to include professional pro- ductions of a statuary or of a sculptor only. Uyn-^r 47th Congress, \ HOUSE OE REPRESENTATIVES. ( Mis. Doc. 6, 2d Session. ( \ Part i . THE TARIFF COMMISSION, APPOINTED UNDER ACT OF CONGRESS APPROVED MAY 15, 1882. December 4, 1882. — Referred to tlie Committee on Ways and Means and ordered to be printed. The honorable Speaker of the House of Representatives of the United States : Sir : The undersigned, constituting the Tariff Commission established by the act of Congress of May 15, 1882, have the honor to submit the final report of the results of its investigations, and the testimony taken in the course of the same, the presentation of which by you to the honor- able House of Representatives of the United States on the first Mon- day of December, 1882, in compliance with the requirements imposed upon the Commission by said act, is respectfully requested. The terms of the law under which the Commission has acted are as follows : Be it enacted by the Senate and Rouse of Representatives of the United States of America in Congress assembled , That a Commission is hereby created, to be called the “Tariff Commission,” to consist of nine members. Sec. 2. That the President of the United States shall, by and with the advice and consent of the Senate, appoint nine commissioners from civil life, one of whom, the first named, shall be the president of the Commission. * * * Sec. 3. That it shall be the duty of said Commission to take into consideration and to thoroughly investigate all the various questions relating to the agricultural, com- mercial, mercantile, manufacturing, mining, and industrial interests of the United States, so far as the same may be necessary to the establishment of a judicious tariff, or a revision of the existing tariff, upon a scale of justice to all interests, and for the purpose of fully examining the matters which may come before it. Said Commission, in the prosecution of its inquiries, is empowered to visit such different portions and sections of the country as it may deem advisable. Sec. 4. That the Commission shall make to Congress final report of the results of its investigation, and the testimony taken in the course of the same, not later than the first Monday of December, eighteen hundred and eighty-two ; and it shall cause the testimony taken to be printed from time to time and distributed to members of Con- gress by the Public Printer, and shall also cause to be printed for the use of Congress two thousand copies of its final report, together with the testimony. It will be seen by the act above recited that the first duty which de- volved upon the Commission was an investigation, or prosecution of inquiries, in relation to all the various questions bearing upon the es- tablishment of a judicious tariff, by means of taking testimony in rela- tion to the agricultural, commercial, mercantile, manufacturing, mining, and industrial interests of the United States, and that for this purpose the Commission was empowered and impliedly directed to visit such different portions and sections of the United States as it might deem advisable. TARIFF COMMISSION. REPORT OF 2 REPORT OF THE TARIFF COMMISSION. It is proper that a brief recital condensed from the daily records of the Commission should be given of the course of procedure in this pre- liminary work, the results of which, in the volumes of printed testimony herewith submitted, form a material portion of this report. The first session of the Commission was held at Washington, on the 6th of July, 1882, and the sessions were continued in that city seven days, during which all the details of administrative organization were completed. The first series of sessions for hearing testimony, commenc- ing on the 19th of July, were held at Long Branch, 1ST. J., that place having been selected for such hearings on account of its easy access from the cities of New York and Philadelphia, and comparative accessi- bility from the principal business centers of the East. The opportunity was also afforded by the proximity to New York to obtain the testimony of the principal experts of the custom-house in that city, in relation to the amendments desirable in the administrative portions of our customs laws. The methods pursued in subsequent hearings were here adopted, viz, of having the sessions for receiving testimony open to the public, while ample facilities for reporting were given to the press; of pub- lishing general invitations, but of making no personal requests for the reception of testimony except to official persons ; of assigning by letter or telegraph the time when each witness desiring an appointment should be heard ; of hearing with absolute impartiality persons of all shades of economical opinion, and of submitting for publication all written or printed statements read to the Commission, as well as oral statements which were faithfully reported by its official stenographer. After a series of sessions continuing for twenty-nine days, including two days occupied in visiting the custom-house in New York and one day at Trenton, N. J., and hearing all the witnesses who were prepared to give testimony, the Commission deemed it advisable to prosecute its inquiries in other portions and sections of the country. After a session of three days in the city of Boston, Mass., the other New England States not being visited on account of their comparative proximity to the two last-named places of session, a route of travel was laid out to embrace the principal business centers of the Middle States and of the West and South. The Commission originally contemplated visits to the Pacific and Gulf States, which were abandoned for want of time. Appointments were duly published for the hearings in the' different cities hereafter named, and every appointment was kept with absolute punctuality. This could have been accomplished only through provisions of exceptional facili- ties for traveling and an indifference to the fatigue attending rapid transit. Within a period of less than five weeks, public sessions for hear- ing testimony were held in the following-named cities, a session having been held on every working day during that period, and during which over 6,000 miles were traversed, principally at night, with the addition of 1,000 miles in visiting the last three places. The cities visited during the route of travel above referred to were : Rochester, N. Y., one day’s session, August 29. Buffalo, N. Y., one day’s session, August 30. Cleveland, Ohio, one day’s session, August 31. Detroit, Mich., one day’s session, September 1. Indianapolis, Ind., one day’s session. September 2. Cincinnati, Ohio, two days’ session, September!, 5. Louisville, Ky., one day’s session, September 6. Chicago, 111., three days’ session, Sejitember 7, 8, 9. REPORT OF THE TARIFF COMMISSION. 3 Milwaukee, Wis., one day’s session, September 11. Saint Paul, Minn., two days’ session, September 12, 13. Minneapolis, Minn., one day’s session, September 14. Des Moines, Iowa, two days’ session, September 15, 16. Saint Louis, Mo., two days’ session, September 18, 19. Nashville, Tenn., one day’s session, September 20. Chattanooga, Tenn., one day’s session, September 21. Atlanta, Ga., two days’ session, September 22, 23. Savannah, Ga., one day’s session, September 25. Charleston, S. C., one day’s session, September 26. Wilmington, N. C., one day’s session, September 27. Bichmond, Va., one day’s session, September 28. Baltimore, Md., two days’ session, September 29, 30. New York, N. Y., six days’ session, October 2, 3, 4, 5, 6, 7. Pittsburgh, Pa., three days’ session, October 9, 10, 11. Wheeling, W. Va., one day’s session, October 12. Philadelphia, Pa., three days’ session, October 13, 14, 16. The public sessions, for hearing testimony, closed at the latter city on the 16th of October. The official announcement of the prevalence of a dangerous epidemic in the Gulf States having rendered the proposed visit to those States inexpedient, Commissioner Kenner, of Louisiana, consented to dis- charge the duty of personally obtaining such testimony in that section of the country as might be offered after due publication of his presence for that purpose, an arrangement which the Commission has reason to believe w as satisfactory to the interests of that section. The proposed visit to the Pacific States having proved impracticable within the brief time at the command of the Commission, formal official communications were addressed to each of the governors of the States of California, Colorado, Nebraska, Nevada, and Oregon, and of the Territories of Arizona, Dakota, Idaho, Montana, New Mexico, Utah, Washington, and Wyoming, requesting them to give notice of the desire of the Com- mission to receive statements from their respective States and Terri- tories. Such statements as have been transmitted in pursuance of these requests have received the same consideration as if personally submitted, and are embodied in the published testimony. Upon this, the first and least difficult part of its work, the Commission permits itself to look with satisfaction, as it may do with propriety, since the only merit claimed for this work is diligence and impartiality in its per- formance. The number of witnesses examined and statements made was 604. The number of places visited was 29. The number of days occupied in taking testimony was 78, and the testimony taken oc- cupies 2,625 printed pages. This testimony presents a faithful pho- tograph of the various economical opinions of the great business cen- ters of the country, at least so far as the interests in question were willing to present them. It is believed that no exhibit of such opin- ions, or of the facts in relation to the vast and varied industrial develop- ment of the country, so condensed and yet so vivid, or so responsible, from the publicity of the hearings and the personal accountability of the w itnesses to the Commission and the public, has ever been pre- sented. Of the character of this testimony it is needless to speak, ex- cept in these general terms, as it speaks for itself in the printed pages; and of the great variety of subjects which it embraces, as more fully shown in the index of testimony, it would be useless to attempt a com- plete abstract. The Commission has, however, made an abstract of the testimony relative to labor and wages in the United States and 4 REPORT OF THE TARIFF COMMISSION. Europe, combined with facts and statistical exhibits from other sources, which will be found in the appendix to this report. The testimony has been invaluable to the Commission for the determination of the imme- diate questions under their consideration. The most grave and responsible duty which has devolved upon the Commission has been its further work of considering and investigating the testimony above referred to, and such other information as has come within its cognizance in reference to the establishment u of a judicious tariff, or a revision of the existing tariff upon a scale of jus- tice to all interests.” The principal object of this report is to state the results of this investigation. Before proceeding to such a statement in detail the Commission deems it proper to declare the spirit in which it has conducted its deliberations, the principles by which it has been governed, and the methods by which it has arrived at its results. In performance of the duty devolved upon them, all the members of the Commission have aimed, and, as they believe, with success, to divest themselves of political bias, sectional prejudice, or considerations of per- sonal interest. It is their desire that their recommendations shall serve no particular party, class, section, or school of political economy. In arriving at results individual opinions have been made subordinate to the object of uniting upon a general system which shall commend itself to the country and Congress as a whole, notwithstanding the minor objections which must inevitably occur to any general measures of rev- enue reform. The Commission has found itself face to face with the most practical questions within the range of national economics — the question of the national revenue and the relations of the existing national industries with the labor depending upon them to the methods of collecting that revenue. The practical question presented to the Commission is that of reconciling the interests of revenue, including the considerations of its sufficient maintenance or possible reduction, with justice to the interests of the nation involved in the preservation of its industries and the se- curity of its labor. The legislation to be recommended is for the pres- ent, and not for posterity, which must meet its own emergencies, and the determination of this question involves considerations of expediency not the least of which is that the measures recommended be such as shall be acceptable to the country and its representatives in Congress. It must accept the facts that discrimination in the imposition of import duties, a discrimination for the most part positive and avowed, and always, at least, with an incidental reference to the defeuse of the na- tional industries, has been the policy of the country for generations; that in consequence of this policy thousands of millions of dollars have been invested in special pursuits ; that the whole business of the country has been adjusted to the conditions of things growing out of this policy, and is inseparably identified with it; and that a subversive or radical change in the present economic system would throw labor out of employ- ment, ruinously depreciate values, and create a general industrial and commercial disaster. With these views, with the unmistakable evidences of public opinion against radical changes, with the whole current of the testimony before the Commission in recognition of the necessity of pre- serving the general structure of our tariff system, with the clear sanction of the law creating this body and its injunction to render justice to all interests, the Commission has deemed it proper to limit its work to a revision, although a substantial revision, of the existing tariff. The Commission, in making the existing tariff the basis of its work, has waived any attempt to construct a system upon an original and REPORT OF THE TARIFF COMMISSION. 5 scientific basis, such as the tariff of France is said to be founded on, not only because such an attempt would have been presumptuous in the brief time at command, but because of the practical objections to such a course. If constitutions, as has been said, are not the creations of councils and legislatures, but the expression of the results of the slow and gradual growth of the political opinions of the people, how much more truly may it be said of a national tariff system like ours, that it is the result of the gradual growth of the necessities for the time for each of the new industries, or interests of production, springing from year to year into existence, and each in its way securing by discrimi- nating duties the national defense from undue foreign importations. A reference to the existing tariff, the gradual growth of generations of de- fensive legislation, to its discriminations, its phraseology, and its desig- nations, has been found essential for preserving the general structure of the existing system, and although in some cases widely departed from, has always been kept in view by the Commission in the changes rec- ommended. For the same conservative reasons the views of the au- thorized representatives and experts in the several industries in rela- tion to objects of discrimination, phraseology, and designations have been carefully considered, and have had great weight with the Com- mission in determining the measures of revision to be recommended. In a theoretically scientific tariff scheme it would have been impossible to preserve the features of the existing system to which the business and industries of the country have become adapted. While giving all the consideration implied in the foregoing statement to the interests affected by revision, in determining the rates to be recommended the Commission has been governed solely by its own views of justice, expediency, and a regard for the interests of consumers and the public sentiment of the country. Early in its deliberations the Commission became convinced that a substantial reduction of tariff duties is demanded, not by a mere indiscriminate popular clamor, but by the best conservative opinion of the country, including that which has in former times been most strenuous for the preservation of our national industrial defenses. Such a reduction of the existing tariff the Commission regards not only as a due recognition of public senti- ment and a measure of justice to consumers, but one conducive to the general industrial prosperity, and which, though it may be temporarily inconvenient, will be ultimately beneficial to the special interests af- fected by such reduction. No rates of defensive duties, except for the establishment of new industries, which more than equalize the conditions of labor and capital with those of foreign competitors can be justified. Excessive duties, or those above such standard of equalization, are positive^ injurious to the interest which they are supposed to benefit. They encourage the investment of capital in manufacturing enterprise by rash and unskilled speculators, to be followed by disaster to the adventurers and their employes, and a plethora of commodities which deranges the operations of skilled and prudent enterprise. Numerous examples of such disasters and derangements occurred during and shortly after the excessively protective period of the late war, when tariff' duties were enhanced by the rates of foreign exchange and pre- miums upon gold. Excessive duties generally, or exceptionably high duties in particular cases, discredit our whole national economic system and furnish plausible arguments tor its complete subversion. They serve to increase uncertainty on the part of industrial enterprise, whether it shall enlarge or contract its operations, and take from com- merce, as well as production, the sense of stability required for ex- 6 REPORT OF THE TARIFF COMMISSION. tended undertakings. It would seem that the rates of duties under the existing tariff — fixed, for the most part, during the war under the evi- dent necessity at that time of stimulating to its utmost extent all do- mestic, production — might be adapted, through reduction, to the present condition of peace requiring no such extraordinary stimulus. And in the mechanical and manufacturing industries, especially those which have been long established, it would seem that the improvements in machinery and processes made within the last twenty years, and the high scale of productiveness which has become a characteristic of their establishments, would permit our manufacturers to compete with their foreign rivals under a substantial reduction of existing duties. Entertaining these views, the Commission has sought to present a scheme of tariff duties in which substantial reduction should be the distinguishing feature. The average reduction in rates, including that from the enlargement of the free list and the abolition of the duties on charges and commissions, at which the Commission has aimed is not less on the average than 20 per cent., and it is the opinion of the Com- mission that the reduction will reach 25 per cent. The reduction, slight in some cases, in others not attempted, is in many cases from 40 to 50 per cent. The actual amount of the total reduction cannot be stated with precision, partly from want of time to make the calculations re- quired for such details in the brief period intervening between the final determination in particular cases and the preparation of this report ; and there is no exact standard by which to estimate the amount of re- duction in revenue, on account of the varying character, amount, and prices of commodities in the importations of different years. If the reduction reaches the amount at which the Commission has aimed, and if there is any truth in the allegation of the opponents of the present economic system, that a duty on articles such as are produced iu this country, whether in manufactures or agriculture, enhances the price to the consumer, not only of what is imported, but of the whole domestic production, to an amount of which the duty is a measure, the reduction proposed by the Commission would benefit consumers to the extent of hundreds of millions of dollars. As the amount of reduction cannot be stated with precision, it follows that no statement can be safely made as to the effect of the proposed reduction upon the total volume of the revenue from import duties. The amount of the reduction in the total volume of the revenue could be stated absolutely onty by showing the income that would be lost by the enlargement of the free list. Al- though the free list is considerably enlarged in the scheme proposed, this list has already been so enlarged by previous legislation (to such an extent as to embrace nearly one-third in value of the merchandise imported in 1881) that little room is left for reform in this direction. It is probable that the reduction of the total volume of the revenue would not be proportionate to the reduction of the duties, for the reason that the reduction may, temporarily at least, increase importations, and greater revenue for a time may result from the lower duties. The adoption of an inflexible rule of horizontal reduction would have made the work of the Commission in this direction comparatively easy ; but such a method would have been unskillful, timid, and unjust. The essential feature of our existing tariff system for generations has been dis- crimination, and nothing but disaster has attended the temporary depart- ures from this rule. A horizontal reduction would have been a violation of the injunction in the law creatiug the Commission to make the revision upon a scale of justice to all interests. In the exercise of this discrimi- nation the Commission has found its most responsible, delicate, and ERRATUM. On page 7, eighth line from close of first paragraph, for “ latter” read “former. REPORT OF THE TARIFF COMMISSION. 7 difficult task. In the use of its best discretion, and in the light of the testimony upon which it was authorized by law to found its conclusions, it has not hesitated to withhold the application of the general rule of reduction in many cases, and in some, though comparatively few, cases to recommend an increase of duties where such increase seemed to be required to preserve the u scale of justice.” It has been the effort of the Commission to make the reduction apply to commodities of neces- sary general consumption, and to diminish or withhold the reduction upon commodities of high cost, requiring more labor, and which being con- sumed principally by the more wealthy classes could bear higher duties, at the same time supplying revenue and encouraging the higher arts with- out being oppressive in their operation. Some of the proposed discrimi- nations are made without reference to considerations of revenue, as that in the duty on books, reduced in the interests of the diffusion of knowl- edge, and the advance in the duties on works of art, made for the en- couragement of original American art. It has been sought invariably to make a discrimination in the rate of the duties imposed upon a manu- factured product and the raw material or partially manufactured prod- uct of which it is made, the object being to impose a higher duty upon the latter / With but a few exceptions a less reduction has been applied to the products of agriculture than to those of the mechanical and manufacturing industries, for the reason that the former are less benefited than the latter by the improvements in machinery and processes, and the economies resulting from a high scale of productiveness. In the reduction applied to the latter, however, it has been earnestly kept in view not to make it so great in any case as to diminish the compensa- tion of labor. The methods by which the Commission arrived at its results, in con- sidering the details embraced in the tariff schedule, may be here briefly described. After finishing its labors of investigation on the 10th of October, the Commission commenced its work of deliberation in the city of New York on the 17th of October, which work has been continued without interruption in full session of all its members. Schedules having been prepared, and amendments to the adminis- trative sections drafted by the several members of the Commission, these were submitted to the entire Commission, and considered, amended, and finally adopted ; the Commission giving to each the closest attention, and the whole time of the Commission having been devoted to their careful consideration, it is confidently believed that the proposed amendments have been as carefully £>repared as the limited time at the command of the Commission would permit. Whatever defects or errors of judgment the work of the Commission may present, the country and Congress are assured that the most earnest and definite attention has been given to the execution of the work. While aiming to diminish the burdens upon the people which inevitably attend any system of collecting the national revenue, the Commission has not lost sight of the relations of a wise tariff' system to the attain- ment of the highest possible material life of the nation; its security in times of war, both in its means of defense and industrial independence; its position among other nations; its acquisition of all the arts which fortify, enrich, and adorn ; its attractiveness for the skilled labor of other lands, and the comfort and means of support of all its people. To show how momentous to these interests are the questions involved in a tariff revision, the Commission presents statements of the productive indus- tries of the country for four decades, classified in accordance with the fourteen schedules in the tariff scheme herewith submitted. In the 8 REPORT OF THE TARIFF COMMISSION. detailed observations upon each of these schedules the statements per- tinent to each will be given in full. The subjoined table shows the industrial progress of the United States for the last four decades. Census year. Number of estab- lishments. Capital. Average number hands employed. Total amount wages paid during year. , Value of ma- terials. Value of prod- ucts. 1850 123, 025 $533, 245, 351 957,059 $236,755,464 $555, 123. 822 $1,019, 106, 616 1860 140, 433 1,009, 855,715 1,311,246 378, 878, 966 1,031, 605, 092 1, 885, 861, 676 1870 252, 148 2,118, 208, 769 2, 053, 996 775, 584, 343 2, 488, 427, 242 4, 232, 325, 442 1880 253, 840 2, 790, 223, 506 2, 738, 950 947, 919, 674 3, 394, 340, 026 5, 369, 667, 706 It is to be noted that the figures given for 1870 are upon the basis of the then depreciated currency, while the figures for 1880 are upon a gold basis. The above table shows that capital increased in the decade ending in 1860 about 90 per cent. During the period between 1860 and 1870, about 110 per cent., and for the last decade only about 32 per cent., to which should be added the difference in the standard of values. That at the close of the first decade referred to, the number of hands employed increased 37 percent.; between 1860 and 1870, 75 per cent.; and be- tween 1870 and 1880, about 33 per cent. From 1850 to 1860 the wages paid increased 60 per cent.; from 1860 to 1870, 105 per cent.; and from 1870 to 1880, as we come down again to a gold basis, 22 per cent. The materials used from 1850 to 1860 increased 86 per cent.; from 1860 to 1870, 141 per cent.; and from 1870 to 1880, 36 per cent. The value of the products of these manufactures increased from 1850 to 1860, 85 per cent.; from 1860 to 1870, 124 per cent.; from 1870 to 1880, 27 per cent. The progress of the nation in manufactures during the last forty years has been, for capital invested, 423 percent.; for hands employed, 180 per cent. ; for wages paid, 300 per cent.; for materials used, 511 per cent. ; and for value of products, 427 per cent. The growth of industries during the last decade, upon the whole, has been a healthy and prosperous one, and yet it has not more than kept up with the growth of population. The increase in population during the last ten years has been about thirty per cent., whereas it has been shown that the increase of capital invested in manufactures has been 32 percent.; in the number of hands employed, 33 per cent.; in the amount of wages paid, 22 per cent. ; in the value of materials consumed, 36 per cent.; and in the value of the products, 27 per cent. It will thus be seen that, great as has been the prosperity, the in- crease in manufacturing in the United States during the last decade does not more than keep pace with the population, and is not more than proportionate to the home demands for our domestic products. According to Mr. Mulhall, an English statistician of recognized author- ity, the total value of the products of English manufactures for 1880 was about $4,000,000,000. The table above given shows the value of the products of our own manufactures to be, in round numbers, $5,370,000,000, givingtheUnited States the eminence of being the great- est manufacturing country in the world. REPORT OF THE TARIFF COMMISSION. 9 Tt is by such figures as the above that the impression, of which the Commission is deeply conscious, may be convened to Congress and the public of the grave responsibility involved in a tariff revision which may so seriously affect the material interests of the nation. Reference has hitherto been made only to the interests of production as affected by the work of revision intrusted to the commission. The character of the proposed revision in the interests of American com- merce must next receive consideration. It is an error to suppose that there is any real antagonism between the interests of production and of commerce. Gnr internal commerce, the most important of our com- mercial interests, depends mainly upon domestic production. There are, moreover, but few of our domestic industries which are not more or less dependent upon foreign commerce for the supply of materialfor manufacture, eitherin araw state or partially manufactured. Any amelioration of the unnecessarily burdensome restrictions bearing upon the importations, provided the duties required for the equaliza- tion of the different conditions of capital and labor here and abroad are preserved, is a boon not only to commerce, considered as a separate national interest, but to production. In this view the Commission has earnestly considered whether, in the work intrusted to it, it might not propose some salutary reforms in the administrative portions of our tariff laws, and to this end has directed extensive inquiries — the only testi- mony directly solicited— to a great number of experts in the custom- house administration, and to others engaged in commerce. These in- quiries were largely guided, and the deliberations upon them aided, by their late esteemed associate, Commissioner McMahon, whose practical knowledge in relation to the subjects of this special inquiry was per- haps unequaled, and whose sudden death near the close of its labors may render more impressive the statement of this part of the work of the Commission, to which he materially contributed. Among the administrative measures recommended by the Commis- sion are, the substitution of a single entry fee at the custom-house for the present numerous and annoying small fees; giving authority for certain procedures now adopted without the sanction of law ; giving facilities for the importation of the personal effects of emigrants; giving authority that weights and measures in invoices shall be those of gen- eral use in the country of exportation ; requiring that invoices of mer- chandise subject to ad valorem duty be made out in currency actually paid therefor, as well as that of the place from which importation is made ; limiting the requirements of triplicate invoices to articles subject to ad valorem duties only, making it imperative that before certifying to an invoice the consular officer shall require an oath, affirmation, or declaration that the invoices are correct; providing more equitable, rigid, and efficient penalties for under valuations ; providing for an appraisement, separate and distinct, in all cases; permitting the exam- ination of bulky goods for appraisement at other places than the public stores; and other changes, which will be more particularly referred to in another portion of this report. Perhaps the most important and radical change recommended is the repeal of the sections of the existing law requiring the addition of in- land transportation costs and charges to the basis of an ad valorem duty. Although the repeal of these sections will effect a large reduction of duties, especially on bulky goods, such repeal was strongly recom- mended, both by custom -house experts and importers, as a measure of relief from the greatest source of annoyance in the liquidation of duties on imported merchandise. 10 REPORT OF THE TARIFF COMMISSION. Another important measure recommended by the Commission, in the form of a proposed bill for the purpose, is the establishment of a customs tribunal for the determination of disputed questions arising under our tariff laws as to the classification of duty of imported merchandise. At present these questions are first determined by the Secretary of the Treasury, and, in many cases, are not finally determined, except on ap- peal to the highest courts of the United States, involving great delay and uncertainties as to the duties payable. The necessity of a prompt decision in respect to questions of classification can hardly be overesti- mated, and it is most desirable that every aid should be given to make the machinery for collecting the duties work as easily and simply as possible, so as to avoid, so far as may be, all that may make the practi- cal working of the tariff unpopular and unnecessarily onerous. The Commission believes that the measure proposed would provide effectual relief from one of the greatest sources of annoyance to which merchants are now subjected in their importations. As in many cases goods, wares, and merchandise are imported which are made for this market, and, therefore, without an established mar- ketable value in the country of their production, and a large proportion of the imports are sent on consignment to agents of the manufacturers in the United States on mere arbitrary invoices, and as in all these cases it is extremely difficult, if not impossible, to ascertain the dutiable value of such goods with any reasonable precision, the Commission recom- mends that by law provision be made for ascertaining their value as nearly as may be, by adding to the value of their component materials, at the place of manufacture, the expense of manufacture and a reason- able profit on the manufactured goods, and providing that in no case the dutiable value shall be less than the amount of each cost of material ex- pense of manufacture and profi t so ascertained. The Commission submits the following observations in detail, appli- cable to each of the proposed schedules of duties, and the recommenda- tions as to the administrative portions of the tariff laws. The proposed schedules and the recommendations last referred to are appended to this report, and are to be regarded as a portion thereof. Schedule A. — Chemical Products. The progress of the chemical industry in the United States during the last decade has been one of the most marked in our industrial pro- gress. From the statistical table given below it will be seen that the capital invested and number of persons employed during the last ten years has increased nearly 200 per cent., the amount paid in wages more than doubled, while the product was $70,000,000 more in 1880 than in 1870. Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 Number. 400 514 740 1, 349 Number. 3, 936 6, 048 11,995 29, 500 $7, 001, 860 13, 579, 597 31,681,714 85, 486, 856 $1, 275, 564 2, 078, 290 5, 4 27, 696 11,820,728 $8, 935, 381 13, 029, 057 29, 668, 643 77, 344, 281 $14, 501,341 22, 161,983 47, 397, 388 117, 407, 054 1860 1870 1880 The facts used in the preparation of the above table, so far as they relate to 1880, were obtained from the recent reports of the Census Office, and those for 1850, I860, and 1870 were taken from the census REPORT OF THE TARIFF COMMISSION. 11 volumes on manufactures for the respective years. As these reports differ from each other in the articles named and the methods of collect- ing the information, the Commission has combined what in its judg- ment seemed to be the several branches of industry which should prop- erly be classed under the generic term u Chemical products.” It was apparent at the outset of this inquiry that an industry employ- ing nearly thirty thousand hands, with an annual product of nearly $120,000,000, was entitled to a separate schedule. In the peparation of this schedule the testimony before the Commission of every witness on drugs and chemicals has been consulted, and the Commission has profited by the suggestions of manufacturers of chemical productions and of what might be called the allied products, such as colors, paints, essential oils, and soap; and of druggists and metallurgists, on ores, minerals, earths, and clays. Some difficulty was experienced in deciding as to the articles to be classified under the generic term of “ chemical products,” and though great care has been exercised, the classification can hardly be claimed to be perfect. In addition to those articles which are unquestionably chemicals, it is found necessary to include, in order to make a more har- monious schedule, such crude vegetable substances and minerals as are largely used in chemicals. Also in some cases it has been thought ad- visable to place on the chemical schedule metals that are almost entirely used in this branch of industry. In the classification, the suggestion of chemical experts, that this schedule be arranged under the three heads of animal, vegetable, and mineral, has been followed. The aim has been throughout to place all the raw material used in this industry on the free list, and only to make it dutiable when advanced in value by grinding, refining, or other pro- cess of manufacture in which labor becomes an element for considera- tion. A few exceptions to both these rules may be found, but in these cases as in that of sumac (a raw material), a great injury would result to a large number of persons whose daily subsistence depends upon the gathering and sending to market of this plant. On the other hand, per- haps it might be urged that the Commission is subject to the charge of inconsistency in leaving quinine (an advanced product) on the free list; but in view of the recent action by Congress in relation to this article, no change is recommended. The system of graduating duties with re- gard to the stages of advancement in the manufacture of an article has been incorporated into the general clauses of both the free and dutiable lists. The free list has been very largely increased by the sweeping clauses introduced in regard to chemicals, and while a less number of articles is enumerated, the list is, in reality, very much larger, practically mak- ing all crude drugs, indeed all substances not edible, and in a crude condition, free. A large proportion of these articles in the existing law are subject to rates of duty varying from 20 to 30 per cent, ad valorem. In another clause all crude minerals not enumerated, and now bearing 20 per cent, ad valorem, are proposed to be made free. The same pro- ducts, advanced in manufacture, have all been reduced from 20 to 10 per cent, ad valorem ; also all non-dutiable crude minerals, but which have been advanced in value or condition, from various rates to a uni- form rate of 10 per cent, ad valorem. Following this same principle, it has been deemed in the line of sim- plification of the tariff’ to provide similar clauses embracing all earths or clays, proprietary, alcoholic, and medicinal preparations, and colors 12 REPORT OF THE TARIFF COMMISSION. and paints; and, to some extent, oils have in tliis same manner been included under a general clause, as well as aniline dyes. In the few cases where an advance of duties is proposed, it has been merely for the purpose of classifying an article in the 10 or 20 per cent, ad valorem clause; and in cases where a 5 per cent, advancement or reduction is of little importance one way or the other, this has been done to preserve general harmony through the schedule. It is difficult to estimate the average reduction proposed, which ranges from 5 and 10 per cent, to over 200 per cent. Counting the additions to the free list, the schedule has been subjected to a reduction of 25 to 30 per cent. The schedule has been condensed and arranged so that it will be easily understood, and as far as possible all ambiguities of expression are abolished, so that protests and appeals resulting from official differ- ences of opinion in relation to construction of the law may be avoided and its administration simplified. Schedule B. — Earthenware and Glassware. An examination of the following tables in relation to earthenware and glassware, as furnished by the Census Office, indicates that these two industries have not been very prosperous during the last ten years: POTTERIES , STONEWARE, AND PORCELAIN. Census year. Estab- lish- ments. 1 Hands. Capital. Wages. Materials. 1 Products. 1850 484 2. 289 $777,544 1,701,774 $607,418 1,044,598 2,247, 173 $275,083 598,308 1,702,705 $1,466,063 2,706,681 6,045, 536 7,943,229 1860 660 3,144 6,116 1870 777 5,294,398 6,380, 610 1880 686 9,494 3,279,535 2,564,259 GLASSWARE. Census year. Estab- lish- ments. Hands. Capital. Wages. Materials. Products. 1850 94 5,668 9, 016 15.822 23.822 $3,402,350 6,133,666 14,111,642 $2,094,576 2,903,832 7,906,425 9,112,301 $1,566,833 2.914.303 6,133, 168 7.991.303 $4,641,676 8,775,155 I860 112 1870 201 19,235,862 1880 194 19,415,599 21,013,464 It will be seen from the above exhibits that in the manufacture of earthenware during the last decade the capital employed has increased 20 per cent.; the wages 46 per cent.; and the production only 31 per cent.; and in the manufacture of glassware during the same period the capital employed has increased 37 £ per cent.; the wages 15 per cent.; and the production only 9J per cent. The Commission has not recommended any change in the duties on brown earthenware and common stoneware, as these duties are already low, and the progress of manufacture in this country is such that not- withstanding the proposed abolition of the duties on packages, charges, and commissions, it is believed that the old rates will afford a reasonable protection to the manufacture here. On white and printed earthenware, and on white and decorated china, porcelain, and Parian ware, the Commission recommends an increase of REPORT OF THE TARIFF COMMISSION. 13 duty in each instance of 15 per cent., and also a change in the wording of the schedules, which, it is believed, is necessary for the purpose of more clearly describing the articles subject to duty. This recommendation as to increase of duties is largely more appar- ent than real, as it will be observed that the proposed abolition of du- ties upon packages, inland freights, charges and commissions, affects this species of earthenware in general use — perhaps — more seriously than any other article embraced in the Tariff Schedules, so that, as will be apparent from the statement of the president of the Pottery Dealers’ Association, and substantially all statements made to the Commission which bears upon the question, a duty of 40 per cent, under the present tariff is substantially equal to a duty of 50 per cent, on these goods with the proposed abolition of dutiable charges. To illustrate, taking the “calculations on one hundred crates of earthenware, being a fair average of the goods as imported,” in the statement of the president of the Pottery Dealers’ Association, the original cost is given at $3,019.00, on which the duty at 50 per cent, would be $1,509.50, while the dutiable basis on the same importation under the present tariff with dutiable charges and commissions added, is $3,763.00, which at 40 per cent, gives $1,505.20 as the amount of duty ; so that the duty under the proposed rates is substantially only 5 per cent, higher than those under the present tariff, because of the pro- posed abolition of the duty on charges and commissions. The Commission’s justification for recommending this increase is that the condition of this industry is such as to make the increase absolutely necessary to its maintenance, and we are convinced that without the relief proposed there must be a very material reduction — if not an abso- lute destruction — of the manufacture of earthenware in the United States. The statements made before the Commission show that this industry is one of very recent introduction ; that at the time the present duties were imposed it had substantially no existence in this country, and that its establishment under the present rates could hardly have been accomplished but for the premium on gold which, during and after the war, operated as an incidental protection. Under the stimulus of the incidental protection, the manufacture of white earthenware commenced less than twenty years ago, preceding attempts having resulted in failure. The present tariff on this class of goods was not intended as protect- ive in any sense, as there was not at the time of its passage any such industry to protect, and the rate of duty was increased from 24 per cent, to 40 per cent, as a revenue measure only. Referring again to the com- parative statement of the earthenware business presented above, we find that although the manufacture of white ware did not commence until 1863, the growth up to 1870 was very much in excess of the growth of the succeeding ten years ; while we believe, as indicated in the state- ments made before us, that at present it is on the decline; and the small value of the product in comparison with the capital and labor employed seems to indicate very severe competition in the business. This is also, as we think, shown in the fact that although the foreign cost of production has actually increased since 1860, the prices to the retail dealer and consumer have decreased, which we think is fully es- tablished by the clear statements which have been presented by the representatives of the industry, accompanied by actual invoices of sales to retail dealers ; and, we may add, that we think a careful examina- 14 EEPOET OF THE TAEIFF COMMISSION. tion of the statements of the importers and dealers will lead to the same conclusion, for while some of these think prices are now higher than be- tween 1850 and 1860, many of them admit that they are about the same or somewhat lower. The reason of the reduction of prices since 1860 is proper matter for con- sideration, and the Commission is unable to indicate any cause except the competition occasioned by manufacture in this country. The machinery used in this business, unlike that used in almost all others, seems to be incapable of material improvement ; the potter’s wheel of to-day is sub- stantially that in use at the commencement of the century, and even of much earlier times. A very large proportion of the work has been, and must be, hand labor; and the fact of an increase in the cost of produc- tion within the last thirty years clearly shows that the reduction in price cannot be attributed to any of the usual causes for reduction, viz., im- provement in machinery and appliances, and consequent decrease of cost of production; so that we are driven to the conclusion that the competition occasioned by the establishment of the industry here has resulted in a reduction of the profits of the foreign manufacturer and of the importer and dealer, which has lowered the price to the consumer in this country, until now it is probable that as to foreign goods there is very little margin, if any; and the statements show that as to domestic goods the price has been reduced so low that there is no margin to war- rant a continuance of the business at present rates. The difference of wages in Staffordshire, England, and in this country is, we think, clearly shown to be 113 per cent, without allowing for the fact that in England the production of each workman is counted “ good from kiln,” and in this country u good from hand.” That is, the work being mainly piece-work, in England the workman is only paid for such articles as are good when burnt, while in this country he is paid for the articles which he delivers good before burning; so that here the em- ployer pays for and loses the ware spoiled in firing, which, as the state- ments show, makes a difference of about 12 per cent., and makes the ac- tual difference in wages about 125 per cent. We think the statements as to wages may be fairly assumed to be correct. The foreign statement was made in the progress of a wage-arbi- tration proceeding, and apparently admitted to be correct both by work- men and employers, and is confirmed by other statements before the Com- mission ; while the home statement is for the same articles, as shown by the books of a like number of potteries at Trenton, N. J. As to the relative value of American as compared with the same grades of foreign wares, we think that while, in the earlier manufacture here, there was just cause of complaint, because of the greater liability of the American product to u craze,” this has now been overcome, and the American ware is at least as good as the foreign of the same class. In less than twenty years this industry has been established to such an extent that it produces about one-half of the $10,000,000 of these wares used in the country ; it is now, as we think, languishing, and, in view of all the facts appearing in the statements made to ns, the small increase of duty recommended is necessary to its continued existence in this country. Decorated china we regard as a luxury which can afford to pay lib- erally to the support of the government, and in our opinion it is prob- able that under the rates proposed there will be a material increase in the production of this class of goods in the United States. In the matter of glass manufactures, we have recommended a change REPORT OF THE TARIFF COMMISSION. 15 in the wording of the paragraph covering plain, mould, and pressed glass, and flint or lime glassware, and the adoption of a specific instead of an ad valorem duty, which we believe to be as low as it can be put, and permit the continuance of the manufacture here. On cut, engraved, painted, colored, &c., glassware, we recommend that the duty be changed from 40 per cent, to 50 per cent, ad valorem, because we regard this class of wares as luxuries, which can afford to pay the higher rate. On common window glass we have preserved the old rates and clas- sification, with a proviso as to glass coming in the ordinary 50-foot packages, which will, as we believe, save the trouble now experienced at the custom-house by reason of the variance in weight in the contents of these boxes — “50 feet single thick” is intended to weigh 50 pounds, but ordinarily weighs from 49 to 54 pounds, while “ 50 feet double thick ” is intended to weigh 80 pounds, but not infrequently runs as high as 87 pounds, and sometimes even more. We recommend that these boxes be admitted as if weighing 50 and 80 pounds only, which will make a reduction in the duty, and save the trouble at the custom-house result- ing from the varying weights, while the limits as to weights in boxes will prevent the introduction of higher grades of window glass without its paying the corresponding proper increase of duty. Polished, cylinder, and crown glass, and fluted, rolled, or rough plate glass, we have remitted to the general clause, in the belief that it will afford adequate protection and not be difficult of administration. On plate glass, both silvered and unsilvered, we have retained the classification and rates of the present tariff, which seem to be quite low on the smaller sizes, while the larger sizes can well bear heavy rates of duty, as they are articles only used by the wealthy, and may certainly be properly classed as articles of luxury. The manufacture of plate glass in this country appears to have begun about 1870, and it is only during a very few years past that it has paid anything in the way of profit. It now seems to be established on a reasonably firm basis, and this has been accomplished, according to the testimony of at least two reliable and competent witnesses, with far less of arbitrary protection than in other countries, and without the aid of subsidies, such as were given in both France and England. The establishments now existing and in process of construction will, we think, in the coming year be able to supply 4,000,000 square feet per annum at present consumed. As since the establishment of the industry the price is claimed to have been reduced to the consumer about 00 per cent., we think it of moment that such rates should be maintained as will warrant the continuance of the industry. We propose to raise the percentage in the general clause from 40 per cent, to 45 j>er cent., to make it more consistent with the general rates upon glass, and permit the transfer to the general schedule of the pol- ished window glass and rough plate glass, as suggested above; and we recommend that glass plates for use in the manufacture of optical instru- ments and pebbles for spectacles be placed upon the free list. Schedule C. — Metals. This section of the tariff represents a greater aggregate of products than any of the schedules excepting provisions and sundries. The fol- lowing table comprises the principal items represented in Schedule C. 16 REPORT OF THE TARIFF COMMISSION. Large as the aggregate product is, it does not represent all the articles embraced in this important schedule : Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 1860. 1870 1880 1, 434 1,510 2, 926 3, 532 22, 370 52, 854 167, 818 298, 862 $16, 370, 760 59. 748, 011 239, 363, 565 416, 041,643 $7, 165, 248 17, 069, 210 88,194,122 122, 648, 191 $43, 797, 854 99, 458, 696 294, 128, 246 380, 304, 990 $83, 954, 529 182, 376, 930 455, 698, 387 604, 553, 460 From a little over 22,000 persons employed in 1850, we find now nearly 300,000, while the products have increased from $83,000,000 to nearly $605,000,000 in forty years. The metal schedule has probably given rise to more serious contro- versies between the people and the government than any other section of the present law. The revolution in the manufacture of steel, result- ing from the inventions and improvements of Bessemer, Siemens, and others, made the progress of this branch of manufacture during the last decade greater than that of any other of our industries. The ambi- guities and inconsistencies of the present law are more numerous and apparent in the provisions relating to metals than in any other part of the law. The country and trade have outgrown the legislation of eighteen years ago. New processes, new terms, new articles are now in existence, and in no part of the tariff law is revision more necessary than in this schedule. The anomaly of the finished article bearing only half the duty levied on the material out of which it is made is one instance of the numerous inconsistencies. Many of the articles enumerated in this schedule have become obsolete, and their places have been taken by substitutes of better material and the nomenclature has been changed. Metal products which twenty years ago were of so little importance as not to merit special enumeration were in 1881 imported to the value of thirteen millions of dollars. No line of demarkation between iron or steel is now fixed by law. Decisions of Treasury officials or of the courts have undoubtedly re- versed the intentions of the framers of the existing tariff. On nearly the same dates appraisements at different ports have been made so widely at variance as to seriously involve the fortunes of some of our business houses. Our courts are blocked with innumerable cases aris- ing from customs decisions, and litigation seems to be a natural se- quence to importation. The terminology and general provisions of the law are entirely inapplicable to the trade and commerce of the present day. All these causes, and many others suggested in the testimony, in the judgment of the Commission make a revision of this schedule im- perative. The testimony of the Treasury officials, importers, and manufacturers has shown that in nothing has there been greater trouble or more mis- conception in regard to classification than in iron and steel. The Com- mission has therefore aimed to formulate a schedule which will be uni- form in its rates, from the crude material to the most highly finished article ; which is careful and exact in its wording ; which is harmonious in the relations that the different articles bear toward each other; and which has clauses of definition and termination so drawn as to preclude the possibility of the recurrence of the troubles between the government and importers that have occurred during the past fifteen years. The REPORT OF THE TARIFF COMMISSION. 17 Commission recommends in this schedule the abolition of compound and the adoption, so far as possible, of specific duties; also that the rates on iron and steel be in the main concurrent — that is to say, so that the rates on manufactures of common Bessemer steel shall be the same as those on similar articles when made of iron. The numerous decisions of the Treasury Department have been examined, and the changes pro- posed are in conformity with the spirit of the law as at present admin- istered. In adopting specific duties, the Commission has been guided by the following reasons : First. That specific rates secure equal assessments of duty at all ports. It is a rare occurrence for the invoices presented by importers at in- terior or minor ports of entry to be increased in value, while in New York and other important ports invoices are raised to conform with for- eign values. This is a hardship to importers in the great commercial cities of the seaboard, where the government officials have greater experience and make closer scrutiny of the consular invoices presented, and constantly and carefully compare the prices thereon with the mar- ket rates of the countries of the world. Specific rates will secure pay- ment of the same duties at all ports. Secondly. That ad valorem duties are excessive when prices are high, and inadequate when values are low and in times of depression. On the other hand, reasonable specific duties do not stimulate an unnatural growth of our manufacturing industries, and when a great and unex- pected demand arises for any of the staples of trade, it can be supplied from the markets of the world, and thus undue expansion is avoided. No radical change in the existing duty on iron ore is proposed. The Commission recommends a specific rate of fifty cents per ton, in- stead of the present rate of twenty per centum ad valorem. The rea- sons that have led to this conclusion are that there has been great diffi- culty in ascertaining the exact value of ores, particularly those exported from Spain and the Mediterranean. The importation of iron ores in large quantities commenced in the last half of the year 1879. The ad valorem rate of 20 per cent, during the past three years has on the average equaled a specific rate of 54 cents per ton. The difficulty of ascertaining the foreign value of such a low-priced article ; the difference in valuation for the same kind of ore, at the same period, in the main ports of importation, allowing an importer to make a profit in Philadelphia, while the appraisement in New York would result in an actual loss; the fact that there are a great many cases now in litigation between the government and importers in regard to the appraisement of iron ores, make it, in the judgment of the Commission, a necessity to adopt specific duties. The Commission is also of the opinion that under a specific duty a higher grade of iron ore low in phosphorus would be brought to this country, while ad valorem rates tend to induce the importation-of the lower-priced ores. The Commission recommends that pig iron and all kinds of sera]) iron be classified at the same rate of duty, viz, three-tenths of one cent per pound. The slightly-increased duty upon cast scrap iron, which this change of classification necessitates, is of little moment, for the reason that a small quantity of cast scrap iron is now imported, and the amount in the future will in all probability be much less. The rates on wrought scrap and on old iron railway bars (which have been the heaviest item of sera]) importation) have been reduced from eight dollars per ton to three- tenths of one cent per pound. It is believed by the Commission that a further reduction of the duty H. Mis. G 2 » 18 REPORT OF THE TARIFF COMMISSION. on pig-iron than that recommended would result disastrously to that important industry. The large amount imported last year (520,162 tons, about one-eighth of our total consumption), shows that the present duty is not highly protective. The duty on importations of pig-iron in 1881 averaged only thirty-four per centum ad valorem. The manufac- ture of pig-iron is widely spread, extending through twenty-five States, and, considering the present depressed condition of the industry, a radi- cal reduction would be neither wise nor politic. A specific duty on steel ingots and steel blooms, or what are generally known as rail blooms, will settle the disputes which have continued for years between the Treasury Department and importers, relating to £lie clause under which they should be classified. The Commission has given special consideration to the question of the tariff on steel rails. The present duty has served its purpose in a protective sense; it is now excessive and should be reduced. The argu- ment before the Commission for a'more radical reduction than that recom- mended was, with one exception, made by witnesses advocating the abolition of customs laws, or their modification to an extent that in our belief would endanger the existing system of manufactures and com- merce. The testimony does not show that the consumers of steel rails advocated a decrease of the present duty. Under the existing tariff the price of steel rails has decreased from $120 in 1873 to $40 at the present time. The grow th of this important industry has been unparalleled in the economic history of any country, and in a great measure may be attributed to the high rate of duties. There is every reason to believe that if it had not been for American competition the consumers during the past ten years would have paid prices proportionately as high as those paid for foreign steel rails be- fore the imposition of the present duty of $28 per ton. It might have been to the manufacturers’ interest, considering the present condition of this industry, if, during the last half of that period, the duty had not been so highly protective. This would have allowed the abnormal demand during the early part of the year 1880 to have been supplied by England and the continent, w^ould have raised prices abroad, pre- vented the rapid doubling of the capacity of the works in this country, and avoided the fluctuation, within a period of six months, of the price of steel rails from $40 to $80 per ton. Under this impulse extensive steel works have been erected in the United States, having an aggre- gate capacity of one million eight hundred thousand tons per annum, nearly equal to seven-eighths of the total product of Europe, which last year amounted to two million two hundred thousand tons. It does not seem just, after by law encouraging the building of the Bessemer rail mills, to make a change that would stop them, and affect by sympathy all other branches of the metal trade, throwing out of em- ployment the large number of people dependent, directly and indirectly, upon this industry for support. The Commission has therefore deemed it a proper course to recommend a rate that may be permanent, enter- taining the belief that the products of minerals are gradually decreas- ing in value. In uniting in the recommendation made, the Commis- sion is conscious of the fact that it may not agree with the radical views of those who have asked that the duty be fixed at from $12 to $15 per ton, nor is it supposed that the proposed rates will meet with the approval of those at this time most interested— the steel manufacturers. The Commission, however, not only in the spirit of compromise, but from the conviction that the maintenance of our steel-rail works are essential to the consumer, consider that the best interests of all concerned REPORT OF THE TARIFF COMMISSION. 19 will be subserved by adopting the rate of duty named in the schedule, viz, eight-tenths of a cent per pound. The adoption of this rate it is be- lieved will prevent extravagant advances in price, will induce economy in the manufacture, and tend to discourage the erection of works in ad- vance of the wants of trade. Steel railway bars are fast taking the place of iron railway bars, and the manufacture of the latter will probably cease in the near future. Makers of iron bars in this country are struggling against the inevita- ble, with the superior quality and longer life of the better article fast crowding them out of the market. The importations of new iron rails for the years 1880 and 1881 were in excess of the amount of new iron rails (not taking into account the rerolling of old rails) pro* 1 need in the United States. The Commission, therefore, does not deem it wise to hasten the end of a dying industry by recommending a reduction of the present duty on iron rails. The reduction of duties recommended on bar iron are as great as should be made, ranging from 10 to 20 per cent. The arrangement of the classification is in the line of simplification. Iron flat bars, rounds and squares, and the smaller and finer sizes have been placed in differ- ent classifications respectively, and graded as to rates more in accord with their cost of production and market value. The Commission does not recommend any material decrease in the duties on sheet iron. The average is a low ad valorem percentage ; and, considering the increasing importations, the adoption of the rates suggested is recommended. On hoop, band, and scroll iron a reduction is recommended on the three classes, of five, ten, and fifteen cents per one hundred pounds, respectively. This class of iron is not in the present law dutiable at rates proportionate to other lines of merchant iron, and considering the additional labor over bar iron required for rolling hoops and bands, as great a reduction is recommended as would be equitable or just. The rates recommended are in a just ratio between bar iron and sheet iron. The Commission has endeavored, in scaling the duties on the various grades of merchant, plate, and sheet iron, to arrange them so that the different sizes and qualities should bear a true relation to each other, according to the original cost both at home and abroad. For the purpose of simplification and to avoid the many complications that arise from the difficulty in designating the exact differences be- tween iron and steel we have placed iron and common steel as far as possible at the same rates. It is a very difficult matter, in articles of hardware or in fine sheet iron, to distinguish, except by analysis, between iron and common steel. The commoner grades of steel are gradually becoming cheaper, and there is reason to believe that in the near future the value of Bessemer steel and that of iron will be identical. The ad- vantage of placing them at the same rate will be obvious when the diffi- culty in distinguishing between the articles is considered. Articles made from low carbon steel, when coated or painted, cannot be dis- tinguished from the same article made of iron. Steel railway fish-plates are being largely adopted in Europe, and will in time supplant the iron fish-plates in this country. Boiler tubes of steel are gradually dividing the trade with those made of wrought iron. Steel axles, low carbon sheet steel, steel beams and girders, and steel locomotive tires are taking the place of the above-named articles of iron. In this view it is deemed by the Commission of the highest importance to have, as far as possible, uniform duties upon iron and common (not crucible) steel. If it were not for this fact, apparently greater reductions could have been made 20 REPORT OF THE TARIFF COMMISSION. upon iron, but in that view, and considering the difference in value of the two metals to-day, it was not thought advisable to bring the steel down to the lower level. Reductions are recommended on iron and steel hardware, railway splices, tools, saws, nails, and spikes, malleable iron, wood screws, iron and steel wire, tubes and pipes of from twenty to fifty per centum. The present duty upon tin plates is an anomaly ; the sheet iron out of which tin plates are made being dutiable under the present law at one and three quarter cents per pound, and then finished tin plate, after being sheared, coated with metal, and boxed, being dutiable atone and one-tentli cents per pound. On account of the difference between the cost of labor in England and the United States, it is now impossible to manufacture tin plates in this country, and the few tin plate establish- ments have been struggling for an existence. The Commission is of the opinion that a moderate rate of duty will develop this important industry, and that wise public policy dictates that at least a part of the amount consumed in this country of so esseniial an Article as tin plate should be produced here. The testimony shows that the intention of the framers of the act of 1864 was to place a duty upon what is commercially known as tin plates, of two and one-half cents per pound, but by an error of punctuation and the transposition of a comma, they were, by Treasury decision, placed at a much lower rate. The reduction which the Commission recommends on steel ranges from one-fourth of one cent per pound on the lower class to about thirty per cent. — caused by the abolition of the compound duties — on the higher grades of crucible steel. Attention has been given to the com- prehensive enumeration of known articles and manufactures of steel. New shapes and wares of steel manufacture formerly made from iron are properly classified according to their value. General clauses, cov- ering the advanced processes, such as cold rolling, polishing, &c., and galvanizing and coating with metal, are recommended in a form drawn so as to cover both iron and steel. The Commission recommends reductions ranging from 20 to 30 per cent, on iron and steel wire, and also the abolition of the present compound duties. It is also proposed to unite iron and steel wire in one class, the rates of course to be concurrent. The assimilation of iron and steel wire, as to cost and market value, and the difficulty of distinguishing between them, in the finer gauges, appear to be conclusive reasons for this decision. The Commission recommends the reduction of the rates upon many miscellaneous manufactures of metal, and a reduction of the rates upon copper, lead, zinc, and other metals of from 15 to 25 per cent. The present rate upon steel wire rods would appear from reading paragraph No. 1428, page 165 of Heyl’s Digest, to be two and one fourth cents per pound as “steel in coils,” but under a decision of the Secretary of the Treasury the duty is levied at 30 per centum ad valorem. It is pro- posed that the duty be made one cent per pound, which is in harmony with the rates suggested for the other products of Bessemer steel. In recommending the comparatively high rate of 45 per cent, for the gen- eral “not otherwise provided for” clause, the Commission is influenced by the idea that this “unenumerated” provision should be, on the aver- age, higher than the general rates in the schedule. A reference to the testimony will show conclusively that a great many of the disputes that have heretofore arisen between the importers and the government have been caused bj T the attempts of consignees to have new articles or old articles under new names made dutiable under the low ad valorem rates REPORT OF THE TARIFF COMMISSION. 21 of the present u not otherwise provided for” clause. It is believed that a close examination of tlie subject will show that this suggestion is of the utmost importance, and that the ad valorem rates for this clause should be placed at the figure named, and in all cases should be higher than the average rate of duty on other articles in the schedule. One of the most important changes recommended is the definition of what is iron and what is steel. This clause has been thoroughly ex- amined by experts in classification, and by many of our noted metal- lurgists. The annoyance and trouble which the public and the officers of the government have had during the past ten years in regard to the appraisement of low-carbon steels and the litigation caused thereby, demand the passage of a law defining their character. The definition recommended is, in the opinion of the Commission, plain and simple, and it accords fully with mercantile custom both in this country and abroad, and its adoption is strongly urged. The products of the new processes, the Bessemer, Siemens-Martin, Thomas-Gilclirist, and the like, or combinations of any of them, are now, and have been, known to all who make, buy, sell, and use the same as “steel.” This is clearly defined in the proposed enactment. The definition of iron remains as recognized by science and trade for centuries. The Commission is impressed with the desire of the people of the country for stability and an assurance of permanence in tariff legislation. Constant agitation of the question creates trouble and excites distrust, prevents the development of the resources of the country, causes wide fluctuations in values, alarms capital — always sensitive — and if the question is not speedily settled may cause wide spread business dis- aster. Schedule D. — Woods. The duties in this schedule have not been changed. The following table includes the annual product of lumber, as well as the several branches of wood manufactures, and illustrates the importance and pro- gress of this industry in the United States : Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 28, 787 107, 119 $58, 749, 647 $31,264, 784 $48, 948, 043 $111, 700, 307 1860 26, 905 129, 135 106, 928, 358 41, 230, 191 73,422 939 164, 401, 328 1870 42, 561 281,746 270, 224, 932 100, 219, 050 209, 552, 855 430, 615, 381 1880 52, 561 334, 764 326, 969, 214 105, 861, 337 289, 895, 174 509, 485, 611 Schedule E. — Sugar. The importance of the sugar schedule is shown by the very large re- turns of revenue obtained from the duty on sugar, exceeding in amount the revenue collected from any other article on the dutiable list, and yielding a national income of forty-five to fifty million dollars. This schedule has received the earnest consideration of the Commis- sion, and has elicited much valuable testimony from the refiners, im- porters and dealers, as well as the producers and consumers of sugar; in fact, from all those classes usually supposed to be specially interested in legislation affecting the product. The Commission has considered the sugar schedule from different standpoints. Firstly, with a view to simplification. Secondly, with a view to the reduction of the rate of duties. Thirdly, with the view of 22 REPORT OF THE TARIFF COMMISSION. recommending to Congress a system of assessing the duties and deter- mining the commercial value of the different grades of sugar which can be less easily evaded in its application than the present system, par- ticularly when applied to the lower grades of sugar. All the witnesses who appeared before the Commission, with singu- lar unanimity, testified to the fact that in all wholesale commercial transactions (meaning the buying or selling of raw or low grade sugar) the polariseope is used by both buyer and seller to ascertain the sac- charine richness and true value of the sugar; that the custom prevails among all the nations of Europe as well as in tbe United Stab s; and when asked if they knew of any reason why the use of the polariseope, so satisfactory in commercial transactions as to be uniformly relied on by both buyer and seller, could not also be equally relied on by the gov- ernment to determine the saccharine richness and true value of sugar with the view of affording a basis on which to assess customs duties in proportion to that value, without an exception, these witnesses — well versed in the methods of buying, selling, refining and producing sugars — testified unhesitatingly that they knew of no reason why the polariseope test should not be used by the government as a basis for applying cus- toms duties. It was also proven by some of those witnesses who had informed themselves on the subject, that in France the polariseope had super- seded the use of the Dutch standard in determining the classification of sugars in order to determine the rates of duties, and that in Ger- many, and even in Holland, where the use of the Dutch standard origi- nated, custom-house officers are instructed that when they have reason to believe sugars have been artificially colored, or their color degraded, to assess the duties according to their saccharine richness or true value, to be determined by the polariscopic test, regardless of their color. One of the witnesses testified that it was proven beyond a doubt or cavil, that it is a common practice to degrade the natural color of Ger- man beet-root sugars by artificial means, when intended for the Dutch or American markets, the business of coloring sugar being regularly carried on as a distinct pursuit at a fixed price per one hundred pounds. It is an acknowledged fact that this degrading the color of cane sugars in the West India Islands is being constantly done to suit the Ameri- can tariff laws, and the practice is justified on the ground that it is merely taking advantage of the language of the laws. Deferring to the language of only two of the witnesses, one, the chem- ist in charge of the United States laboratory at Dew York City, and whose duties have been mostly the testing of sugars, says that — The polariseope is one of the most exact instruments known to chemical science ; the sugar fairly registers itself. The other, a very large importer, also of Dew York City, says that — The polariseope is the most perfect means of ascertaining the commercial value of sugars yet iound. We cannot put any limit to invention, and something better may he found hereafter. The polariseope test, in the first place, enables us to assess a specific duty. In the second place it is ad valorem, because it is fixed upon the value of sugar by polariscopic strength, which is its value for sweeten- ing, and that value is determined by tbe polariseope. The Commission therefore recommend to Congress the use of the polariscopic lest as a basis for assessing customs duties on all sugars below Do. 13 Dutch standard in color, and above Do. 13 adhering to the present classification and the Dutch standard as a measure of value. \ REPORT OF THE TARIFF COMMISSION. 23 The rate of reduction in the proposed schedule is 21.70 per centum on all sugars below No. 13 Dutch standard, as tested by the polariscope, and 10 per centum on all sugars above No. 13, or an average of 14.25 on the whole schedule. Schedule F.— Tobacco. The Commission recommends no changes in this schedule, except to abolish the compound duty on cigars, making the duty $3 per pound. According to the census returns, the value of the tobacco and cigar product has increased from thirteen and a half million in 1850 to nearly one hundred and thirteen million dollars in 1880. Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 1,418 14, 236 $5, 008, 295 $2, 420, 208 $7. 341,728 $13, 491, 147 1860 2, 104 26, 856 12, 529, 960 6, 102, 648 16. 536, 300 30, 889, 313 1870 5, 20 1 47, 848 24, 924, 330 14, 315, 342 34, 656, 647 71, 762, 044 1880 7, 674 57, 587 39, 995. 292 25, 041, 257 65, 368, 308 118, 665, 366 Schedule GL — Provisions. The growth of the population of the country since 1850 can hardly be better exemplified than in the remarkable increase in the value of the products which may be called u provisions”, and which, as will be seen by the following table, have increased in value from about $160,000,000 in 1850 to $1,037,000,000 in 1880. Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 25. 325 51, 275 $66, 788, 808 $12, 279, 768 $121, 475, 585 $159, 407, 128 1860 17, 768 64, 579 106, 114, 152 16, 885, 216 223, 433, 863 279, 844, 782 1870 28, 727 96, 883 198, 874, 861 25, 786, 682 482, 462, 974 600, 365, 571 1880 37, 089 164, 069 314, 289, 399 48, 261, 356 978, 277, 586 1, 036, 572, 580 As the duties on the schedule are very low, but few recommendations of decrease have been made. The testimony in regard to retention of the duty on rice was very strong, and it was shown that the cultivation of this cereal gives employment to large numbers of the colored popu- lation in three of the Southern States, arid that a radical reduction of the rates might result in the abandonment of this industry, which has been resuscitated since the war, and the consequent deprivation of the means of subsistence of thousands of colored laborers in these States. The testimony also brings out the fact that rice-planting rescues the low- lands, by the extensive system of ditching, from an almost valueless con- dition. Rice cultivation can hardly be classed with the ordinary culti- vation of cereals, as it requires a much greater outlay and a longer time to fit the lands for this crop, and in addition to this it is much more sub- ject to vicissitudes of weather. Intelligent witnesses in the rice grow- ing sections advocate an increase in the duty, but in this recommenda- tion the Commission was unable to agree, and a reduction of one-quarter of one cent a pound is recommended. The rates on the other items enumerated in this schedule have been made more harmonious. It is recommended that the duties ou all green fruits, with the exception of oranges, lemons, limes, and grapes, be either reduced in duty or that 24 REPORT OF THE TARIFF COMMISSION. they be placed upon the free list ; that the duties on dried fruits, mustard, and several other minor articles be reduced, and that the ad valorem duty on oranges and lemons be abolished and a specific duty substituted. Nearly all the oranges and that class of fruit from the Mediterranean are consigned fruits, and it lias been almost impossible to determine the market value. The specific rates proposed are believed to be the equiv- alents of the present duties ad valorem, taking the average of the values, as shown in the invoices for the year. In the direction of simplification the Commission has proposed a change in the barrel rate on fish to a rate per pound, as the weights of barrels differ in different countries, the difference varying from 50 to 75 pounds on a barrel. It is proposed that many items be taken from Schedule M, sundries, and properly classified in the schedule, making the law more easy of administration. Schedule H. — Liquors. Including distilled wines and malt liquors, the total value of the prod- uct of the manufactures in this schedule was, in 1880, nearly $145,000,000. The subjoined exhibits show the growth of the distilled and malt liquor industries during the last four decades : LIQUOR, DISTILLED. Census year. Establish- ments. i's it H Capital. Wages paid. Value of material paid. Products. 3850 968 4, 008 5, 409, 334 $1, 089, 864 $10, 543, 201 $15, 770, 240 I860 1, 193 5,416 11, 548, 675 1, 753. 445 18,330,713 26, 768, 225 1870 719 5, 131 15, 545, 116 2,019,810 I 19,729,432 36, 191, 133 1880 844 6, 492 24, 247, 595 2, 663, 967 27,744,245 42, 063, 663 LIQUOR, MALT. 1850 1 431 2, 347 6, 433 1 4, 072, 380 $654, 144 $3, 055, 266 9, 997, 293 28, 177, 684 $5. 728, 568 1860 1,269 j 1,972 2,191 i i 15, 782, 342 2, 305, 970 6, 758, 602 21, 310, 933 1870. 12, 443 26,220 48,779,435 91,208,224 55, 706, 643 1880 12, 198, 033 56, 836, 500 101,058,385 A few verbal changes have been made in the schedule. The proposed schedule embraces all that is essential in the provisions of the existing tariff. Of the two classes providing for spirituous liquors under proof, one was stricken out because there was a double provision for the same thing. The Commission has made no proposed changes in duties, excepting that allowance for breakages be abolished. The schedule has been rearranged, and some items which properly belong to the liquor schedule have been taken from sundries and placed therein. Schedule I. — Cotton. Few industries have enjoyed such a steady and healthy growth in this country as that of cotton manufacture. The following statistical REPORT OF THE TARIFF COMMISSION. 25 exhibit from the census reports shows the progress of cotton manufact- ures in the United States for 40 years : Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 1,094 1,091 956 1,005 92,286 122,028 185,869 185,472 $74,500,981 98,585,269 140,706,291 219,504,794 Hot obtainable. $23,940 108 89,044 132 45,614,419 $34,835,056 57,285,534 111,736,936 113,765,537 $65,501,687 115,681,774 177,489,739 210,950,383 I860 1870 1880 While the other great industries, representing, as they do, hundreds of millions of dollars of annual products, have sent their representative men to furnish information for an intelligent inquiry into their present condition and needs, the cotton industry, with an annual product of $210,000,000, has only been represented by one, and that the smallest, of its branches. In pursuance of the work of simplification the Commission has found many of the paragraphs in the present schedule apparently conflicting, difficult to construe, and causing the practice in different ports to vary greatly. Attention might be called to the use of the words “ finer and lighter” (922 Heyl), “ finer or lighter” (925), “like description” (923), “ lighter description” (926), “ goods of like description” (921), and “goods of like description or for similar use” (par. 924). Paragraph 921, providing for all manufactures of cotton, with certain exceptions, “except jeans, denims, drillings, bed tickings, ginghams, plaids, cot- tonades, pantaloon stuffs, and goods of like description” — which excep- tions are provided for under paragraphs 924, 925, and 926 of the schedule, at a different rate, seems to be unnecessary. There can be no necessity for designating the manner in which goods are woven and the uses to which they are applied ; that only makes the matter more confusing and complicated. There is a variance of language in all these paragraphs above referred to, and they are very difficult to understand. This incongruity results in great difference in the practice in the several ports of the country, and even on the part of officers of the same port, and leads to litigations and confusion, and at all times to troublesome differences between offi- cers and importers — importers in most instances being unable to know what rates of duty they would be obliged to pay until after final liqui datiou of their invoices. The new schedule will operate to simplify the present tariff, first, by the abolition of all #ompound duties; secondly, by the abolition of all contradictory sections and ambiguous expressions, such as those alluded to, and the substitution of six divisions — two each for unbleached, bleached, and printed cottons. It has been necessary, in order to make an adequate specific duty on the higher priced cloths, to make a dis- tinction in the unbleached goods at above eight cents per square yard, in the bleached goods valued at above ten cents per square yard, and in the printed goods valued at above fifteen cents per square yard, and on these goods an ad valorem duty of 40 per cent, is recommended. Instead of four divisions m the sections relating to cotton thread, yarn warps, or warp yarns, the Commission proposes seven divisions; below twenty-five cents a pound, above twenty-five and not exceeding forty, above forty and not exceeding fifty, above fifty and not exceeding sixty, above sixty and not exceeding seventy, above seventy and not 26 REPORT OF THE TARIFF COMMISSION. exceeding eighty, and, finally, all cotton yarns valued at over eighty cents a pound. In regard to this latter paragraph the commission would state that it has made inquiry from the leading cotton yarn manufacturers of the country, which has resulted in bringing out the fact of great difference in the amount and value of the labor required in spinning the coarser and finer yarns. For example, taking the reports of the day’s markets, it is found that the cotton used in spinning the coarser yarns sold at be- low 25 cents per pound is quoted at 10J cents per pound. A pound of this cotton will make seven yards of cloth, which is quoted in the same paper at 3J cents per yard, making a total value of about 24 cents, the value of the raw material having been increased about 133 per cent. On the other hand, a pound of cotton, such as is used in spinning the finer qualities of yarn, costs 30 cents per pound, and the value of the yarn per pound, when spun, is $1.50, or an increase of 530 per cent., and this great enhancement of value is almost wholly caused by labor. But it must be remembered that in the latter case the pound of yarn is yet to be manufactured into sewing thread. One pound of this class of cotton yarn will make eight dozens No. 70 cotton, 200 yards to the spool, and this cotton is sold at a net price of 45 cents per dozen, mak- ing $3.60 for the product of one pound of yarn. In brief we have a poundgOf raw material, in the one case valued at 10^ cents, finally placed upon the market at 24 cents ; and a pound of Sea Island cotton, valued at 30 cents, placed upon the market at $3.60. These fine yarns are made from combed cotton, the combing process being very expensive, both on account of the cost of machinery and the requirement for experienced and skilled workmen in the manipulation. As the yarns increase in fineness, the number of work-people employed in their manufacture is largely increased. The testimony of a firm manufacturing in this country and in Great Britain brings out the fact that wages here are somewhat more than double the amount paid on the same kind of work, with the same ma- terial, manufactured on the same machinery. The Commission is of the opinion that as the average ad valorem duty on cotton embraced in the first classification of paragraph 927, Heyl, is now little over 48 per cent., it was not advisable to reduce these grades of yarns in the same proportion as some of the finer goods on which the average ad' valorem duty runs up as high as 60 per cent. This will make the average ad valorem rate on coarse yarns about 45 per cent. On the other hand, as the class of yarns at present embraced in the second classification of the same paragraph in Heyl (valued at over 40 cents a pound, and not exceeding 60 cents a pound), and upon which the proposition of the Commission makes two separate rates of duty, bears an average ad valorem rate of 58-^f 0 - per cent., it is believed that a reduction from the existing rate of 20 cents per pound and 20 per cent, ad valorem to 20 cents per pound on the first grade, and 25 cents per pound on the second (new classification), would be fair and equitable, as that would give a protection to this class of yarns, esti- mating the average value of the first class at 45 cents per pound, and the average value of the second class at 55 cents per pound, of 44 per cent, and 45 per cent., respectively. Again, the third clause of 927 Heyl (valued at over 60 cents per pound and not exceeding 80 cents per pound, the ad valorem duty on which has averaged nearty 61 J per cent, at the existing rate of 30 cents per pound and 20 per cent, ad valorem), the Commission has divided into two classes. On the first, yarns, valued at over 60 and not exceeding REPORT OF THE TARIFF COMMISSION. 27 70 cents per pound, 30 cents a pound or 46 per cent, average ad va- lorem is recommended, for the reason already stated, that it would be absolutely disastrous to these industries to reduce the rate of duty be- low the average ad valorem rate of 45 per cent. For the second class, valued at over 70 cents a pound, and not exceeding 80 cents, a specific duty of 36 cents a pound is recommended, making this also an average ad valorem rate of about 48 per cent. If the rate of duty on yarns costing over 80 cents is placed below 50 per cent, ad valorem, it will be impossible for mills now in operation to continue the manufacture of these numbers, excepting at a reduction in the wages to the working people that will be oppressive, the average ad valorem rate on these goods being now 54 per cent.; and the Com- mission suggests that all this yarn be placed at 50 per cent, ad valorem. The unit of value on imported spool cotton (per 100 yards) is 13.6 cents per dozen. Calculated on this basis the duty of 6 cents per dozen recommended will be the equivalent of something less than 45 per cent.; an apparent discrepancy when compared with the duty recommended for thread not on spools, valued at above 80 cents per pound. The ap- parent discrepancy disappears when the practical application of a spe- cific duty as compared with an ad valorem duty is taken into the esti- mate. Schedule J. — Flax, Hemp, &c. It is gratifying to observe that the hemp, jute, and flax industry, which at present has not assumed very great importance in the United States, shows a steady increase during the last decade, and that, as will be seen from the following statement, the value of the products is over five and a half million dollars. The product has increased nearly 100 per cent, during the past decade. Census year. Establish- ments. Hands em- ployed. Capital. Wages. Materials. Products. 1850 8 325 132 $167, 700 62, 636 $76, 812 34, 579 $211, 500 119, 488 1, 504, 001 3, 323, 354 $351, 808 1860 4 34 233, 404 1870 100 2,111 4, 753 2, 849, 951 3, 526, 955 634, 889 1,238,158 1 2, 993, 785 18b0 110 5, 518, 866 While practically the Commission has proposed no change in the rates except to reduce the rate on cotton bagging under 7 cents per square yard from 2 cents to 1J cents, and above 7 cents per square yard from 3 to 2 cents, it has to some extent simplified the schedule and removed some of the ambiguities in the phraseology of the law. Schedule K. — Wool and Woolens, wool. Statement showing the number of sheep and the product of wool and imports of wool in the United States in the years 1860, 1870, and 1880. Census year. Sheep. Wool. Produced. Imported. 1860 Number. 22, 471,275 28, 477, 951 43, 576, 899 Pounds. 60,264,913 100, 102, 387 240, 000, 000 Pounds. *42, 131, 061 49, 230, 199 128,131,747 1870 1880 : Imports of 1862. 28 REPORT OF THE TARIFF COMMISSION. The first phase of the industry of wool production that arrests the attention of the economist is its general distribution. Not a State in the Union, and, in some of these, net a count} 7 , but has some portion of its wealth invested in wool production. This results from the twofold impulse of choice and necessity — choice, in those favored localities adapted to general farming ; neces- sity, where, from the character of the surface or sparseness of vegeta- tion, sheep are the only domestic animals that can be profitably em- ployed — while experience 'has demonstrated that some kind of animals must be employed. This for two reasons : 1. The people must have meat food ; and 2. Farming cannot be successfully prosecuted over any large area under a system that does not return to the soil a fair equiva- lent for the inevitable tax which crop-bearing entails. The Commission, recognizing this prominence of sheep husbandry in its relation to agriculture, and its additional importance as the source of supply of material for an important manufacture, were impelled to seriously consider the effect of any change in the existing duties on for- eign wools. The law fixing these duties was passed in 18G7, with the approbation of the entire body of producers, so far as any expression could be secured, and the wisdom which guided its promoters has found substantial vindication in the growth of sheep husbandry during the past fifteen years, as indicated in the figures above given. Asa result of augmented production the price of wools has been reduced to the consumer, while at the same time the producer, by improving his stock, has been enabled to realize as much money from individual animals as he secured in former years. The average price of the United States wool clip, in the Boston market, in currency, was — 1867 $0 51 1870 46 1875 43 1880 48 the equivalent of a value per head of sheep : I860 t.. $1 40 1870 1 61 1880 • 2 68 Certain elements entering into the expense of producing wool at the time the existing duties were laid have been removed by Congres- sional action — notably, the tax on incomes — and the discharge by com- munities of heavy local indebtedness incurred during the war period then so recently terminated. In view of these considerations, as well as those that apply to the business of wool production in common with all other industries, the Commission was of opinion that some reduction could be made in existing wool duties without working serious incon- venience to the wool producers of the country. The reduction suggested is the removal of the 11 per cent, and 10 per cent, ad valorem duty on wools of the first and second class respectively, and a reduction of one-half cent per pound on wools of the third class valued at less than 12 cents per pound, and one cent per pound if valued at above 12 cents per pound. This arrangement, while, as is believed, not seriously interfering with the defense of the domestic wool-grower, will tend to simplify the operation of the law, by making duties specific instead of compound, thus facilitating enforcement, while insuring col- lection of the entire duty for which importations are liable. The classification of wools for duty under the existing law has been retained. This classification, based on blood of the animals bearing the REPORT OF THE TARIFF COMMISSION. 29 wool, has been found to meet all requirements — being easily understood by the customs officers, and reducing opportunities for evasion to the minimum. The omission of the word “like” from the sentence enumerating hairs subject to the same duty as wools of the second class, is intended to have the effect of imposing the same duty on hairs of the camel and other animals, used for mixing with wool, as is imposed on the class of wool which they displace. The discrimination against wools of the second class when imported in an unwashed condition has been removed, and these wools placed on the same footing as wools of the first class when imported in like condition. The duty recommended on wools of the third class (carpet wools), which find quite limited competition in the flock products of this coun- try, and which comprised nearly two-thirds of the wool importations for 1881, calculated on the average prices for that year, is about 24 per cent., and is believed to be at a fair revenue standard. The removal from 32 cents to 30 cents of the division between wools paying the respective duties of 10 and 12 cents per pound will be found to more nearly represent the average between the values of those grades imported which, for the year 1881, were, on wools of the first class, 22.5 and 38 cents respectively, averaging 30.2 cents. The average value of imported wools of the second class, 32.3 cents for 1881, would doubt- less have been considerably lower had not the law discriminated in favor of wools imported in a washed condition. No change is recommended in the duty on shoddy, mungo, waste, &c., as these substitutes are already admitted at a lower rate than is required on the wools they displace, the former being imported in condition suit- able for manufacturing, while the latter lose a greater or less percent- age in the process of cleansing before they can be worked. WOOLENS. The comparative statistics of the wool manufacture are as follows: Census year. Establish- ments. Hands. Capital. Wages. Materials. Products. 1850 1, 559 1, 673 3, 456 39, 252 $28, 118, 650 42, 849, 932 $25, 755, 991 46, 649, 365 134, 154, 615 164, 342, 099 $49, 726, 881 80, 734, 606 217, 668, 826 267, 182, 914 I860 59, 522 $i3, 36i, 602* 41, 357, 235 1870 110, 869 161, 489 132, 382, 319 1880 2, 686 159, 061, 270 47, 351, 628 No part of the existing tariff law has been arranged with so much deliberation and care as that relating to the manufactures of wool. The present tariff* on wool and woolens, substantially that passed in 1867 , 13 the result of the recommendation of the Revenue Commission in 1866, after prolonged consultations with the representative wool growers and wool manufacturers of the United States. While largely reducing the rates in the woolen schedule, the Commission has deemed it expedient to make no material change in its general structure. Iii relation to this portion of the tariff*, the Commission adopts the views and explanations of a minority report of a former Committee of Ways and Means, written, as is well known, by General Garfield. That report says: There are articles in the tariff on wool and. woolens that may be reduced, and per- haps the whole group may bear some reduction. But, on the whole, no part of our tariff system has been more amply vindicated by experience than that which relates 30 REPORT OF THE TARIFF COMMISSION. to wool and woolens. The foundation of these provisions was laid in 1881 ; but in 1887 the existing rates were established, after a Jong and exhaustive investigation, and with concurrence of the two interests which had theretofore been in opposition. The ba>is of that legislation was this: That upon the several grades of imported wool a duty should be imposed sufficient to promote the growth of sheep husbandry in the United States. A specific duty was then imposed on woolen goods, as near as possible equal to the duty put upon the wool which entered into the manufacture. This was not protection, but simply aa equivalent duty, which placed the woolen manufacturer on the free-trade level. To this specific duty was then added a duty of 35 per centum ad valorem on woolen goods, as a protection to the manufacturer against foreign competition. This adjustment of the laws liis remained substan- tially unchanged for thirteen years (now fifteen), and during the six years preceding the adjustment the law contained similar, though less complete, provisions. Tlie characteristic feature of this adjustment is the application of compound duties. While, iu the opinion of the Commission, compound duties are generally objectionable, and their elimination is recommended in all the other schedules, there seems to be exceptional reasons for their retention in the schedule of woolens, although four commis- sioners, viz, Messrs. Ambler, Porter, Underwood, and McMahon, refused to assent to the retention of compound duties in this schedule, or in any case. The woolen industry is the principal and the only one of any magnitude burdened by a duty on raw material, and is therefore pecu- liarly entitled to the facilities for the arrangement of its defensive duties found in the system of compound duties for overcoming this difficulty. Besides, no system of specific duties could be devised to ade- quately cover the vast variety of fabrics produced in this branch of manufacture, while on the other hand a system of pure ad valorem duties, it is believed, would admit an injurious competition of foreign low shoddy goods with the sounder American fabrics, thus displacing the consumption of domestic wools, a competition equally obnoxious to the wool grower and manufacturer. Moreover, besides the general ob- jection to ad valorem duties growing out of the prevalent system of undervaluation in the importation of foreign goods, an ad valorem duty so high as to cover the compensatory duty would be invidious and lia- ble to arbitrary reduction, on the inconsiderate view that it is purely protective to the manufacturers. Justice to this branch of industry would seem to require that the distinction between the compensatory and defensive duty to the manufacturer should always be kept in view, as it is in the existing adjustment. In the reductions iu this schedule which the Commission proposes, ranging for the great bulk of fabrics from 18 to 40 per cent., the aim has been to make the reduction apply most effectually to the cheaper goods of necessary consumption, with a view of benefiting producers as well as consumers, for reasonable prices to the consumer mean in- creased consumption, and of course correspondingly increased stability and lucrative employment to the producers. An entirely new clause is proposed, providing for a very large reduction in the duties bearing upon the lower-priced woolen fabrics, including blankets, and remov- ing the excessive duties upon those articles which have been the sub- ject of much complaint. Comparatively less reduction is proposed on the finer, lighter, and more costly cloths, involving more labor in their production, upon the ground of public policy, which demands the en- couragement of the higher branches of manufacture. A comparatively less reduction is proposed on dress goods for the reason that they are now subjected to an exceptional foreign competi- tion, the importation of dress goods for 1880 having amounted to over 08,000,000 square yards, while the American production for the same period amounted to 40,000,000; that is, the home manufacturer of one REPORT OF THE TARIFF COMMISSION. 31 square yard of these goods was met in the market with one and seven- tenths yards of foreign goods. The proposed clause in relation to all-wool merino goods is a new provision, and has in view the introduction of fabrics never yet success- fully made in this country. Many of these goods constitute staple fab- rics subject to few changes of fashion, and the manufacture of them would furnish an increased demand for our hnest wools; and as they are the choicest woolen fabrics for female apparel, their manufacture would be a most desirable acquisition to our national industry. In considering the rates of duty in this schedule, the Commission has not been unmindful of the great variety of fabrics embraced in the woolen manufacture, their utility as well as their beauty, the immense outlay of capital required in their production, the artistic taste and technical skill necessary to success in the higher branches of the manu- facture, and the vicissitudes to which the manufacturer is subject by the caprices of fashion, nor of the important consideration that, there being no exports of domestic wool, upon this manufacture depends the prosperity of a leading agricultural interest, the sheep husbandry, dif- fused in every State and Territory. Schedule L. — Silk. It is an interesting fact that in 1860 the importations of silk manu- factures into the United States amounted to $32,961,120, and that twenty years later (1880), after the successful introduction of the silk manu- facture in this country, the imports amounted to $32,188,690: while on the other hand the value of the product of our own silk manufactures has increased from $6,589,171 in 1860 to $41,033,045 in 1880. Thus, while the population of the country has increased 20,000,000, and its wealth proportionately, the importations of this class of goods have remained practically the same, the larger proportion being now supplied by the home manufactures. The following exhibit from the report of the special agent of the cen- sus, William O. Wyckoff, shows the growth of the silk industry for the last four decennial periods : Census year. Humber of establish- ments. Hands em- ployed. Capital. Wages. Material. Value of products. 1850 29 857 $433, 950 $154, 488 $860, 180 $1, 226, 476 1800 137 5, 300 2, 938, 680 1, 035, 308 3, 906, 250 6, 589, 171 1870 88 6, 699 6, 243, 130 1, 953, 306 8, 324, 573 12, 739, 362 1880 383 31,337 19, 125, 30(f 9, 146, 705 22, 467, 701 41, 033, 045 The slight changes in phraseology and classification of the silk sched- ule recommended by the Commission were inspired by a desire to simplify construction and to facilitate its enforcement. To this end the Commission has substituted specific for ad valorem duties wherever the former could be made to apply. The duties recom- mended indicate a reduction from existing duties of something more than 23 per cent. Schedule M. — Books and Paper. The industry of these manufactures is deemed sufficiently important to warrant their classification under a separate schedule. 32 REPORT OF THE TARIFF COMMISSION. Schedule N. — Sundries. The report of the Bureau of Statistics for 1881 gives the total value of “the principal and other imported merchandise entered for consump- tion in the United States,” including the dutiable and free list, as $650,018,999.63. Of this amount $202,557,111.68 came in free of duty. The total amount of duty collected on the dutiable merchandise imported was $193,800,879.67. The total products of the manufactures of the United States, as already shown, amounted in 1880 to $5,369,667,706. In each of the preceding schedules the Commission has shown, as far as possible, the relative importance of the industries included in the several schedules in the United States during the lastforty years ; that is to say, the number of hands employed, the value of the material consumed, the amount of wages, and the aggregate value of the product. In the same way an attempt has been made to ascertain the value of the product represented by what may be called the sundry schedule. In this work it was fouud impracticable to select anything further than the principal items, such as boots and shoes and leather manufactures of all kinds, agricultural machines, musical instruments, jewelry, oil, India rubber and elastic goods, brushes and brooms, clothing, carriages, and a score of other articles of manufacture of less importance. The aggregate value of all these products, so far as the Commission has been able to enumerate them, was, in 1880, $1,159,989,616, leaving a remainder unenumerated of $945,825,550. In this work absolute ex- actitude is not claimed, as the classification and methods- for taking the census have differed under different superintendents and management, and perfection in classification is impossible. The subjoined table, which gives the value of the products for the several schedules, as rearranged by the Commission, is, perhaps, as nearly correct as a comparison of this kind could be made. It will 1)3 seen that the largest amounts are represented by the provisions schedule and the sundries, which latter, if the computation had been carried further, would in all probability have included most of what is given under the head of “remainder.” Next to it comes the value of the product as represented by Schedule C, metals, and which in itself amounts to within $16,000,000 of the entire imported merchan- dise, including the dutiable and free list for year 1881. The object of this presentation is merely to bring out as forcibly as possible t he great indus- trial progress of the United States during the past forty years, and to show the enormous amount of manufacturing necessary to supply the home markets for the wants of fifty millions of people. In other words, while the total imports are represented in round figures by $600,000,000, the total home productions of our manufactures would be nearer $ 6 , 000 , 000 , 000 . Amounts of products embodied in tables prepared. Schedule. Products in 1880. Schedule. Products in 1880. $117,407,054 28,956,693 604, 553, 460 509, 485, 611 X — Cotton $210,950,383 5,518,866 267, 182, 914 41, 033, 045 1, 159, 989, 616 B — Earthen and glass ware C — Metals D — Woods ... J— Flax K — Woolens L— Silk 181, 404, 520 find N Sundries, lioolvs, &c F Tobacco G — Provisions H — Liquors 118,' 665^ 366 1, 036, 572, 580 142, 122, 048 Remainder 945, 825, 550 5, 369, 667, 706 REPORT OF THE TARIFF COMMISSION. 33 In addition to the above table, to make this general-statistics table complete, and that a ready reference may be made to the special items of imported merchandise, the following statement showing the values of the principal and other imported merchandise entered for consumption in the United States during the fiscal year ending June 30, 1881, is herewith appended: FREE OF DUTY. Value. Animals, living $1,550,227 06 Articles, the growth, production, &c., of the United States, exported and brought back, &.c 4, 879, 168 98 Barks, not otherwise specified . 492, 561 49 Books, maps, and charts 373,250 00 Chemicals, drugs, dyes, and medicines 23,560,046 15 Cocoa or cocao, crude and fiber, leaves and shells of 1, 047, 678 00 Coffee. 56,901,888 39 Cork-wood or bark, unmanufactured 787,933 00 Cotton, unmanufactured 757, 352 00 Dye-woods, in sticks 1, 680, 886 19 Fish from the Dominion of Canada, Newfoundland, &c 2,265,673 59 Fruits, including nuts 743,961 71 Fur skins of all kinds, not dressed 2, 774, 428 00 Guano 399, 551 68 Hair, unmanufactured 874, 727 00 Hide and skins, other than fur skins 27,756,990 07 Household and personal effects, &c., of immigrants 2,416,562 53 India-rubber, crude, and milk of 11,022,002 05 Ivory, animal and vegetable, unmanufactured 873,200 00 Machinery for the manufacture of beet sugar, and imported for that purpose solely 40, 431 00 Oils, fixed or expressed, and volatile or essential 1, 497, 590 43 Painting, stationery, &c 311,243 00 Platinum, unmanufactured, and basis and retorts of 294,635 00 Paper materials 5, 233, 575 40 Seeds 314,344 30 Silk, cocoons, raw, waste, &c 12,352,963 00 Tea.... 21,004,059 33 Tin, in pigs, bars, or blocks 3,971, 756 67 Wood, unmanufactured 3,657,343 49 All other articles, free of duty, except from Hawaiian Islands 7, 348, 306 00 Articles free of duty from Hawaiian Islands: Rice of all kinds Fruits and nuts Molasses Sugar All other articles 389,016 80 20, 600 00 35, 036 63 4, 927, 020 74 1,402 00 Total from Hawaiian Islands 5,373,076 17 Total free of duty 202,557,411 68 Animals, living 3,917,823 93 Beer, ale, and porter 848, 958 80 Books, engravings, and other printed matter, bound and unbound 2,560,588 99 Braids, plaits, flats, laces, trimmings, &c 2,340,384 00 Brass, and manufactures of 494, 249 01 Breadstuff's, and other farinaceous food, not otherwise specified 9,208,956 23 Bricks and tiles 150, 406 30 Buttons and button materials 3,160,419 85 Candles and tapers 3,238 50 Chalk 20,328 15 Chemicals, drugs, dyes, and medicines 14,888,493 15 Chiccory 132,536 00 Clay 193,405 93 Clocks and watches 2, 447, 399 34 Coal 2,073,954 78 Cocoa, manufactured 39,120 50 Copper, and manufactures of 564,923 54 H. Mis. 6 3 34 REPORT OF THE TARIFF COMMISSION. Value. Corsets and corset-cloths $535, 819 00 Cotton, manufactures of 28,084,116 69 Diamonds (cut), cameos, mosaics, &c 8, 330, 071 45 Earthenware and China 6, 383, 874 27 Embroideries 3,133,590 00 Fancy articles 7, 084, 301 69 Fish 1,355,724 88 Flax, and manufactures of 21,020,570 62 Fruits, including nuts 12, 511, 806 39 Furs, and manufactures of 4, 270, 161 33 Ginger, essence, ground, and preserved 16, 578 80 Glass, and manufactures of 5, 862, 269 60 Gold and silver, manufactures of 232,638 11 Hair, and manufactures of 734, 055 55 Hats, bonnets, and hoods 982, 943 55 Hemp, jute, &c., and manufactures of 10,568,126 16 India-rubber, manufactures of 243,029 35 Iron and steel : Iron, and manufactures of 32, 991, 038 45 Steel, and manufactures of 18, 463, 535 15 Lead, and manufactures of 163, 741 95 Leather, and manufactures of 10, 522, 601 24 Marble, and manufactures of 553, 900 32 Mats and matting 519, 128 29 Metals, metal compositions, and manufactures of, not otllfcrwise speci- fied 1,162,913 05 Mineral aud bituminous substances, not otherwise specified 94, 959 45 Musical instruments, and strings for 1, 390, 391 02 Oil-cloths for floors, &c 124, 000 01 Oils: Mineral 17, 193 92 Animal 72, 268 70 Vegetable, fixed or expressed 683,701 34 Vegetable, volatile or essential 278,519 47 Paintings, &c., not by American artists 2,210,944 47 Paints and colors 985, 604 69 Paper, and manufactures of, not otherwise specified (except books) 1,806,891 06 Provisions, not otherwise specified 1, 127, 874 98 Salt 1,908,797 19 Seed 1,612,207 41 Silk, manufactures of 32,377,226 48 Slate, and manufactures of 46, 864 50 Soap 252,751 35 Spices 2, 203, 078 49 Spirits and wines ..., 8, 762, 762 74 Starch 35,478 04 Stone, and manufactures of (except marble) 195, 863 12 Straw, manufactures of 41,422 89 Sugar, molasses, and confectionery 89,811,785 48 Tin, manufactures of 14, 714, 146 53 Tobacco, and manufactures of 6, 474, 938 67 Umbrellas, parasols, and sunshades 102, 088 00 Varnish 140,551 71 Vegetables not otherwise specified 746,510 07 Wax, and manufactures of 6, 332 62 Wood, and manufactures of 7,496,815 79 Wool, and manufactures of 45, 164, 149 01 Zinc, and manufactures of. 262,218 48 All other dutiable articles 8, 141, 527 38 Total dutiable 448, 061, 587 95 Total free list 202,557,411 68 Grand total $650, 618, 999 63 Referring especially to tlie changes made in the u Sundry” schedule, it was found that it contained a total number of 272 sections, having from time to time been made the receptacle of many dutiable articles that REPORT OF THE TARIFF COMMISSION. 35 properly belonged to other schedules. The Commission has relegated 99 of the sections to the chemical schedule, 25 to the provision sched- ule, 26 to the metal schedule, and the remainder to the respective schedules to which they belong, and the free list. This, with some consolidation, will reduce the number of sections in the present sundry list to nearly one-third of its former proportions. It has been revised, and the wording in many cases simplified and the duties reduced on an average fully 20 per cent. STATUTES RELATING TO DUTIES OF COLLECTORS. The Commission recommends the adoption of substitutes for sundry sections of the Revised Statutes, and appends to this report drafts of the proposed substitutes. These substitutes are recommended for the reasons following : The proposed substitute for section 2499 seems necessary, as without it non-enumerated articles are dutiable under the general clause, not- withstanding the fact that they are substantially in material and use the same as other articles which are on the free list. That is to say, a special enumeration of the precise article must be found in the free list to exempt it from duty. The Commission is of the opinion that the same rule should obtain as to the free list which is applied in other parts of the law, and that articles similar in material and use to those specifically named in the free list should be free of duty. The change proposed in section 2626 is for the purpose of saving un- necessary duplication of work, as it seems only necessary that the final adjustment or liquidation of duties should be verified by the naval offi- cer, and that it is entirely unnecessary that he should countersign any papers issued by the collector, other than debenture certificates ; the check by the naval officer on the accounts of the collector, it is believed, will be complete without the other requirements of the present law, and the proposed change will save unnecessary annoyance to importers. The proposed changes in section 2627 are to strike out the words “if American vessels,” in definiug the duty of the surveyor as to ascertain- ing whether masters of vessels entering have complied with the law in regard to manifests of cargoes, so that this section may conform to other provisions of the statutes and the general practice; and to re- quire the appraiser to report to the surveyor the respective degrees of proof of imported liquors, so as to avoid the preseut practice, which requires an ascertainment of the proof both by the surveyor and the appraiser. This frequently results in differences between the reports, arid as in case of such difference the practice has been to take the re- port of the appraiser as more likely to be correct, we see no purpose in requiring the proof to be ascertained by two sets of officers. The change proposed in section 2648 is to do away with the system of petty charges for stationery blanks in the collection offices on the north- eastern and northwestern frontiers, where the entries are ordinarily small in amount and there is great complaint on account of annoying small charges. We think the government should furnish these blanks free of charge,, as the expense w r ould be very small, and the effect would be to avoid what is now regarded as an annoying exaction. The purpose of the proposed amendment to section 2654 is also to avoid annoying small fees. Instead of the present system of small fees for each service performed, we recommend an entry fee of 50 cents, which is intended to cover all the charges enumerated after the fifth clause of 36 REPORT OF THE TARIFF COMMISSION. the present section. This will probably operate as a reduction of fees on the average of entries, but it is believed the amount will be sufficient to compensate for the services. There is great complaint on the part of importers of the annoyance occasioned by the present fee bill, and we do not doubt that they would generally prefer even a much' larger entry fee if they could thereby avoid the vexation of the present system of numerous small fees. The Commission recommends the repeal of section 2658, because it would be rendered unnecessary by the adoption of the provision for a general entry fee as recommended in connection with section 2654. The proposed change in section 2770 is for the purpose of relieving against what is believed to be a hardship in the importation of bulk cargoes, such as iron ore, coal, stone, and other heavy materials, where the small value in proportion to weight makes reshipment or lightering unreasonably expensive. To illustrate, the port of New York is, as we understand, limited to the lines of the city, and the unloading must be (at least as to all foreign vessels) within those lines, or at some port of delivery in the district, and there seems to be no good reason why the owner ot a forge or furnace within the collection district should not be permitted, under inspection as provided for, to land ore or coal at his own wharf, although such wharf is not within the lines of a port of delivery of the district. The purposes of the proposed change in section 2785 are (1), to re- quire the entry to be in accordance with the pro' visions of section 2870, and the bills of lading, and (2) to do away with what is believed to be a useless and annoying formality, which under the present law requires the production by the importer of the original invoices, or other docu- ments received in lieu thereof, to the naval officer as well as the collect- or, and the signing of the same in the offices of both the collector and naval officer. The purpose of the proposed change in section 2789 is to clear up a doubt as to the right of the collector under the law to take merchandise into his custody until the quantity, quality, or value thereof can be as- certained when the defect in the entry arises from an imperfect descrip- tion of the merchandise in the bill of lading or invoice. We understand that in general the practice has been in accordance with the draft of the law recommended by the Commission, but that there is such doubt on the subject as to require the insertion of the provision recommended, for the protection of collectors. The changes proposed in section 2795 are intended as a relief in cases where an excess of sea stores were taken on board by permitting, to a limited extent, their entry and sale on payment of duties, after the taking of the oath that they were truly taken on board as such. The proposed changes in section 2799 are (1), to include in the section all the articles free from duty according to law of persons arriving in the United States as emigrants; and (2), instead of the present indefi- nite word u shortly” to fix the time within which they are expected to arrive, limiting it to one year, in accordance with the next section. The proposed changes in section 2800 are (1), to make it conform to the recommendations as to the preceding section, and (2), to limit the time for the making of the oath described to three mouths after the arrival of the emigrant. The proposed changes in section 2801 are intended to remit to the collector the duties mentioned in tl^e section, as in the judgment of the Commission there is no purpose in requiring the naval officer to partic- ipate therein. REPORT OF THE TARIFF COMMISSION 37 The proposed change in section 2803 allows the baggage and personal effects of persons arriving in the United States to be forwarded by the collector to the collector of the port of departure. At present the col- lector can lawfully only retain the baggage or effects until the depart- ure of the owner to his foreign destination, which must be from the same port at which he arrived j whereas we think the law should permit them to be forwarded, say, from New York to San Francisco, if the lat- ter city should be the port of departure of the traveler. The proposed changes in section 2837 are intended to relieve against the requirement that the weights and measures in invoices shall be the legal weights and measures of the country from which the importation is made, which are often little used, and to require that the invoice be made out in the weights and measures in general use in the country in which the goods are procured for importation into the United States. The section at present provides that the weights and measures shall be those of the country from which the importation is made, and it is often difficult to determine what country is meant by the expression, as goods are frequently obtained in some small inland state and transported overland to a port in a different foreign state or country, whence they are shipped by vessel to the United States, in which case questions arise as to whether the place of original purchase or the place of maritime shipment is the place from which the importation is made. It is be- lieved that the change recommended in the wording of this section will relieve the importer and customs officers from these doubts, which, as we are advised, have been the cause of very frequent trouble and annoy- ance. The proposed change in section 2838 is intended to require that the invoice of merchandise subject to an ad valorem duty shall be made out in the currency actually paid therefor, as well as that of the place or country from which the importation is made, which is regarded as nec- essary in arriving at the true price or value, because of the varying character of the currency of different countries, which it is said fre- quently operate to the disadvantage of the government in ascertaining the actual value on which the duties should be paid. The proposed changes in section 2841 are, (1) to conform the oaths to the proposed change in the mode of levying duties by excluding inland freights, packages, charges, and commissions from being the subject of duty j (2) to require the oath to show that the invoice and declaration are in all respects true, and were made by the person by whom the same purport to have been made as provided in other sections, and (3) in cases where part of the invoices or bills of lading covering merchandise to the person making the entry have not arrived, to allow him to enter those invoices which have arrived, and permit the others to be entered on the receipt of the invoices and bills of lading which cover them. The law now requires that the oath shall state that the entry covers all the goods, wares, and merchandise imported in the vesselfor the con- signee, and as he can not enter lawfully without the production of the invoices and bills of lading, it seems necessary to make this change so as to permit him to enter the goods for which the invoices and bills of lading have arrived, with the right to enter the remainder of the goods consigned to him, where he can lawfully do so, without sending the whole consignment to the general orders stores to await the arrival of the pa- pers which w ill enable him to make a complete entry of the v T hole con- signment. The proposed change in section 2846 is intended to allow- the personal representatives of deceased persons and the assignees of insolvent per- 38 REPORT OF THE TARIFF COMMISSION. sons to make entry of merchandise owned by their decedent or assignor, whether the same are subject to ad valorem or other duty. At present the right, according to the statute, only attaches where the merchandise is subject to ad valorem duties. The purpose in the proposed amendment to section 2853 is to limit the requirement of triplicate invoices to articles subject to ad valorem duty or duty based on value. There seems to be no necessity for these triplicate invoices in the case of articles subject to specific duties, as their only purpose is to verify the price paid, or value of the goods, and we have therefore deemed it proper to recommend that they shall not be required except in cases where the goods are subject to ad valorem duties. The purposes in the proposed amendments to section 2854 are (1) to make the section conform to the proposed change resulting from the abo- lition of duties on charges and commissions, and (2) to require that invoice shall be produced and verified before the consul of the United States in the country of and nearest the place in which the goods were origi- nally procured for exportation to the United States. Under the exist- ing law the invoice may be produced and verified before a consul out- side of the country within which the goods were either procured or shipped, and who may therefore have but little means of knowledge as to their value at the place of purchase, while the expression u nearest the place of shipment” is indefinite and has received different construc- tions, the term 11 shipment” being sometimes construed as the point of marine shipment, and sometimes as the inland point at which they were freighted. It is our opinion that limiting the production of the invoice and its verification to the consul of the country of and nearest the place where the goods were }>rocured for importation to the United States will not only tend to make certain what has heretofore been in- definite, but will also tend to uniformity in prices and values and hon- esty of invoices. The proposed amendment to section 2857 is to allow the collector, in cases where the triplicate invoice cannot be produced, to admit the mer- chandise to entry and liquidation on the invoice filed by the importer at the time of entry, without requiring the triplicate invoice of bond, when he is satisfied that there is no fraudulent intent or purpose. And the proposed amendment to section 2859 is intended to extend the priv- ilege of entry and liquidation without invoice, where the goods are less than $100 in value, and the collector is satisfied that there is no pur- pose of defrauding the revenue. The proposed amendment to section 2860 is intended to exclude from the operation of the section the entries provided for in the act of June 22, 1874, generally known as the u anti-moiety act” (as well as the four preceding sections mentioned), which is deemed necessary to preserve the rights of entry therein provided for. The proposed amendments to section 2862 are, (1) to make it impera- tive that before certifying any invoice the consular officer shall require an oath, affirmation, or declaration that the invoices are correct and true ; (2) that the oath, affirmation, or declaration shall be in accord- ance with the laws of the country where taken; (3) that the oath shall show that it was made in the place where the goods were originally procured for exportation to the United States, and (4) that the oath or declaration shall be attached to the invoice and certified by the consul. These amendments are deemed necessary to insure uniformity in the practice as to these oaths or declarations, certainly as to the place where they are to be made, and the solemnity resulting from the con- REPORT OF THE TARIFF COMMISSION. 39 formity to ihe local forms of law. At present, as we understand, the oaths are taken frequently at the point of marine shipment, which is often far from the place of purchase, and where the person taking- the oath can have no knowledge as to the facts sworn to, and are generally regarded as mere idle formalities. The proposed amendments to section 2869 are intended to leave with the collector alone the estimate of gross duties upon entries and to dispense with the services and signature of the naval officer in grant- ing the permit to land, simply requiring the verification by the naval officer of the final liquidation of the duties. The verification of the original estimate and the signature of the naval officer to the permit seem to be unnecessary formalities which may well be dispensed with, while the verification of the final adjustment is necessary as a proper check upon the collector’s office. In the proposed amendments to section 2870 it is intended to pro- vide by law that the permit for landing merchandise shall conform to the bills of lading and invoices, and that where, from errors in the bills of lading (for which, of course, the importing vessel is responsible) it is necessary to send the goods to general orders store, the importing vessel shall, unless otherwise ordered by the collector, be charged with the resulting expense, because in that case the expense has resulted from the carelessness of the carrier. The proposed amendments to section 2882 are intended to do away with the ambiguity resulting from the use of the words u proper officer” instead of designating the officer, and to do away with uncertainty in practice, by designating the form of consent. Our understanding is that the practice is not uniform, and that while the collector is usually regarded as the proper officer to discharge this duty, sometimes other officers assume to give consent to remove because of the uncertain expression in the law, and that controversies often arise because of the removal of goods on the claimed consent of some officer of the customs. We deem it advisable that this should be changed — that the consent should be in writing, and should be given by the collector. The proposed addition to section 2885, requiring a return to the sur- veyor by the inspection officers of the quantity, kinds, and proof of wines and spirts, is for the purpose of furnishing to the surveyor the means of keeping liis account of this class of merchandise, and is made necessary by the suggested amendment to section 2627, under which a single appraisement only will be had, instead of a double appraisement as at present. The proposed amendment to section 2887 is intended to exclude the naval officer and surveyor from participation in the inquiry as to whether merchandise has been landed since it was taken on board, or whether the disagreement is by accident or mistake. The collector is the proper person to examine into these questions, and the participation of the naval officer and surveyor is understood to be merely formal and seems unnecessary. The proposed amendment to section 2898 is intended to do away with the necessity for consent of the consignee before estimating the tare ac- cording to the invoice. In our judgment the collector should be per mitted to estimate tare according to invoice in all cases except where it is evident to him that the tare, as stated in the invoice, is more or less than the actual tare. The proposed amendments to section 2900 are, as it will be perceived, radical and important; the law at present merely permits the appraise- ment, and in practice, unless there is some cause for suspicion, the in- 40 REPORT OF THE TARIFF COMMISSION. voice is often taken as correct without much, if any, investigation. We think that there should be an appraisement separate and distinct from the invoice in all cases. Under the existing statutes no penalty is im- posed unless the appraised value exceeds the entered value 10 per centum or more ; and then (on the variance of a few cents often) there results the imposition of a 20 per. centum penalty on the entire ap- praised value. This is believed to induce the making of entries by un- scrupulous importers as nearly as they regard safe within the limit, while on the other hand great hardships frequently occur to honest im- porters who have made some mistake and are subjected to this penalty from which they can have no relief. From the information at our command we have been led to believe that the ordinary range of honest difference of opinion in values of im- ports will not exceed 5 per cent, in the absence of error or mistake, and the proposed amendment imposes no penalty where the difference does not exceed that percentage ; the proposed section then provides for a gradually increasing penalty, until the appraised value exceeds the entered value more than 15 per centum, and then declares that such excess of 15 per centum shall be presumptively fraudulent, and that the collector shall seize the goods and proceed to forfeit as in other cases for violations of the customs laws ; and that in such proceeding the fact of the under- valuation exceeding 15 per cent, shall be presump- tive evidence of fraud, and throw on the claimant the burden of remov- ing the presumption by proof. We think there can be no doubt that systematic under- valuation is rather the rule than the exception, as seems to be evident from the well-established fact that persons visiting European countries are often without request tendered an invoice at less than the price paid, with the explanation (when explanation is asked for) that it is necessary to enable them to enter the goods without paying full duties ; and from the further fact, which seems equally clearly established, that many European manufacturers decline to fill orders or sell goods for this market except through their agencies estab- lished in this country, so that the importing business is largely passing into the hands of consignees, who are mere agents for the foreign man- ufacturers, It is claimed that these arrangements are not unfrequently made for the purpose of defrauding the customs laws, and there is rea- son to believe that the claim is not without foundation. Fraudulent undervaluation, when it occurs, is not only injurious to the government by depriving it of revenue to which it is entitled under the laws, but is also destructive of the business of the honest importer, who cannot successfully compete with those who thus avoid payment of a considerable proportion of the revenues to which he is subjected. The purposes of the amendment are to discourage experiments in even slight undervaluation by imposing penalties which, while not too severe, will probably result in loss, and to expose the importer to forfeiture in cases where the undervaluation is so great as to be beyond the range of probable honest difference of opinion or mistake, reserving, however, in all cases, authority to grant relief when the collector and Secretary of the Treasury are satisfied that the undervaluation is the result of manifest clerical error or mere mistake and without any intention to undervalue or defraud the revenue. We recommend the proposed change in the confident belief that it will be advantageous to the government and to honest importers. The intention of the proposed amendment to section 2002 is to require the appraisers, and the collector and naval officer when acting as ap- praisers, to ascertain the proof of distilled spirits and the character of REPORT OF THE TARIFF COMMISSION. 41 imported merchandise; that is to say, to examine into and determine these matters apart from the invoices or bills of lading. It is the prac- tice, as we understand, for these officers to discharge the duties referred to, although there seems to be no express statute requiring them to as- certain and determine anything except the value of the merchandise, apart from its character; and as the rate of duty depends on the char- acter of the merchandise it is deemed best to clearly and in express terms direct that they shall discharge the duties in question. The recommendations for the repeal of sections 2907 and 2908 are made on the statements of custom house experts and importers gener- ally, who have uniformly insisted that justice requires their repeal. The sections in question are those which require the addition to the cost or value of the imported article of the cost of transportation, ship- ment, and transhipment and all expenses incurred in the transporta- tion of the article from the place of growth, production, or manufacture to the vessel in which the shipment is made to the United States, the cost or value of the packages, and the commissions paid, which in no case shall be less than two and one-half per cent. These sections apply to goods paying an ad valorem duty or duty based on value. The law has heretefore regarded these u dutiable charges” as part of the cost of the goods imported, and the effect of the proposed abolition would be to withdraw them entirely from consideration in determining the dutiable value of the goods. The result of the repeal of these sections would be a reduction, especially on the coarser and more bulky fabrics, of a con- siderable proportion of the present duties, amounting, as we believe, in some instances, to nearly if not quite one-fourth ; while on the finer and more highly priced goods, the reduction will be much less. The Com- mission recommends the repeal of these sections because of the great labor at the custom-houses in apportioning and distributing the charges on the liquidation of entries (as we are advised the work of liquidation on ad valorem goods is more than doubled by reason of these charges and their distribution), the very great delay in liquidation consequent on the complicated calculations involved in the distribution of the charges on the goods in the invoice bearing different rates of duty, the delay, annoyance, and expense to the importer arising from the necessarily tedious liquidation thus occasioned, and because, in the judgment of the Commission, these charges should not be regarded as part of the cost of the goods. The proposed amendment to section 2926 is to take from the consignee the option of determining, in cases of incomplete entry for want of the original invoice or any other cause, whether the <£Ost or value shall be ascertained with or without the production of the invoice, and to leave the option where we think it properly belongs, to the collector, so that he may require the production of the invoice, or proper evidence in lieu of it, if in his judgment it is necessary to the proper appraisement of the merchandise. The proposed amendment to section 2927 is intended to settle a long- continued dispute as to the proper time for presentation of damage claims, by providing that no claim shall be received until after due entry of the merchandise. The change is deemed important by the custom- house experts. The proposed amendment to section 2932 is to make that section con- form to the proposed repeal of sections 2907 and 2908, and the change in section 2932 as contained in the proposed customs court bill hereafter referred to. The proposed change in section 2939 is intended to permit the Secre- 42 REPORT OF THE TARIFF COMMISSION. tary of the Treasury, when in his judgment it is necessary and proper, by regulation, to permit the examination of bulky goods for appraise- ment at other places than the public stores. It seems evident to us that such authority is necessary, as very frequently considerable expense and delay are incurred by the sending of packages to the public stores for examination, when such examination could be made without risk of loss to the revenue and much more conveniently at some other place, as the wharf where they are unloaded, and such a regulation would, to some extent, relieve the public stores at the appraiser’s office from their present crowded condition. The changes proposed in section 3058 are to allow the actual owner, although not the consignee, to make entry of the merchandise on pro- duction of the bills of lading and invoices, and to provide that the holder of any bill of lading consigned to order and properly indorsed shall be deemed the consignee thereof. The propriety of these changes will, we think, be very apparent, and in view of the frequent cases of advances made on bills of lading by bankers, the latter clause seems to be imperatively necessary ; as in the present condition of the law, al- though by reason of their advances they are the legal owners of the merchandise, they cannot enter the same unless named as the original consignees, and if named as the original consignees, although their ad- vances may have been repaid, the entry of the goods must still be made by them. The effect of the proposed change will be to make the prac- tice as to entries at the custom-houses conform to the ordinary mercantile customs and usages as to the negotiability of bills of lading. The proposed amendments to section 9 of the act of June 22, 1874, entitled “An act to amend the customs-revenue laws and to repeal moieties” (Heyl, p. 151), are (1) to make the exceptions conform to the statutes as to goods accompanying the passenger, by including house- hold effects and books, tools, implements, &c. ; (2) to make the section conform to the recommendations of the Commission not to require cer- tified invoices except in case of goods bearing an ad valorem duty, and (3) to include the documents in lieu of certified invoices, as provided by sections 2785 and 2788. The proposed amendments to section 9 of the act of June 10,’ 1880, entitled “An act to amend the statutes in relation to immediate trans- portation of dutiable goods,” are, to extend the period within which goods may be forwarded to fifteen instead of ten days, which seems to be necessary, as, by reason of the difficulty in procuring cars, the present period is said frequently to be too short; and to enable the collector, with the consent of the consignee, to send the goods to a bonded ware- house at any time after they are landed, when deemed necessary for their proper preservation, without impairing the right to transportation within fifteen days of landing. A CUSTOMS COURT. The present mode of trying the very large number of cases arising under the laws imposing tonnage and customs duties has been the sub- ject of frequent criticism in statements made before the Commission by Treasury and customs rfificials and importers. In case of dissatisfac- tion with the decision of the collector, the law provides for a protest and appeal to the Secretary of the Treasury, who hears the case and affirms or reverses the holding of the collector. The decision of the Secretary is final unless suit is brought against the collector to recover back the duties claimed to have been illegally or erroneously exacted REPORT OF THE TARIFF COMMISSION. 43 within ninety days. The crowded condition of the dockets of the courts necessarily occasions great delay in the decision of these cases, and when decided, the case being subject to writ of error or appeal, when taken to the Supreme Court, again finds its place on a docket incum- bered by accumulated business, and it is ordinarily several years before a final decision is reached. Meantime a great number of importations have been made present- ing the same question already in process of litigation, and the importer is compelled to pay the rate of duties already fixed by the Secretary, and if he desirps to save the question, must protest and appeal and commence his suit to recover back the duties which he claims have been illegally or erroneously exacted from him. Thus the court dockets are further incumbered, and the importers subjected to the expense and annoyance of this added litigation, which is ordinarily determined by the decision of the original case. Meanwhile, pending the litigation, the merchandise imported has been sold, and the duties paid being part of their cost enter to a greater or less extent into the price ; and to the extent that these duties have been paid by the purchaser, he is necessarily without relief, so that on reversal of the decision of the Secretary the duties refunded (less at- torneys 7 fees and expenses) become an additional profit to the importers, who have protested, appealed, and commenced action within the time required by law. Pending the litigation, there has been such uncertainty as to the rate of duty and consequent cost of the merchandise as to nec- essarily interfere materially with legitimate commercial transactions. In the earlier history of the country, when importations were com- paratively small, the business of the Secretary of the Treasury compara- tively light, and the court dockets comparatively unencumbered, no considerable inconvenience seems to have been experienced from this mode of proceeding 5 but all now seem to agree that a more simple and speedy method of proceeding is very desirable if not absolutely neces- sary, and we have thought it part of our duty to suggest a change. It has been suggested that some measure of relief might be obtained by the transfer of the cases brought against the collectors, to the Court of Claims. It is doubtful, however, whether this might not too seriously interfere with the other business of that court, and produce such an ac- cumulation of cases on its docket as to result to some extent in the same delay which is now so seriously complained of. It is thought that to be effective, an independent court should be created, located at the great commercial center of the country, where much the larger proportion of business for its consideration would necessarily arise, and could be con- sidered and disposed of with much less delay and expense than if the court was located elsewhere ; and that a provision for sessions once a year at New Orleans and San Francisco, and at other points at the discretion of the court, as business might require, would add greatly to the prompt and convenient transaction of its business. In the draft of the bill appended hereto we have recommended that at least one of the judges of this court should be a customs expert of at least ten years 7 experience in the service, and this because we are satisfied that among the experienced custom-house officers can be found the men best fitted for the position. The heads of divisions in the larger custom-houses are men who have kept their places through changing administrations, be- cause they were eminently fitted for the discharge of the duties required of them ; we have found them thoroughly conversant with customs ques- tions and with great capacity and aptitude for the service in which they are employed. Their experience and knowledge of customs questions 44 REPORT OF THE TARIFF COMMISSION. and decisions would, as we think, peculiarly fit them for the discharge of the duties devolving on them as judges of the proposed court, and we are satisfied that in its constitution, at least, one of the judges should be of this class, and that the omission of this provision would seriously in- terfere with the efficiency of the proposed court. With a view to simplifying the mode of proceeding and hastening the decision, we have recommended that, unless the court shall otherwise direct, no pleadings shall be necessary, except the papers sent up by the collector on the appeal, believing that the decision of the collector and the protest of the importer will ordinarily be all that is necessary to make up the issue ; and have provided that, except for cause, the decis- ion shall be entered within ninety days of the appeal. The provision for notice and opportunity — in the discretion of the court — for other persons interested to be heard, is because the decision of any question should as far as possible control in other cases in which the same ques- tion may be ijresented, and should therefore be made upon as full a hearing as possible of all persons in interest. The provision for a reconsideration by the collector, on filing of pro- test, is intended to avoid the necessity of appeals from hasty decisions, and that for rehearing before the court is to permit a reconsideration in cases where there is room for doubt. There is a difference of opinion in the Commission as to the propriety of providing for the trial of questions of fact by jury ; but as we do not consider that any constitutional question is involved, or that the party is of right entitled to atrial by jury in the class of cases coming before this court, and as questions of fact will be infrequent, and when occur- ring more likely to be correctly decided by the court than by a jury, on account of their technical character, the proposed bill does not provide for a jury. The proposed bill makes no provision for a review of the decisions of the court by proceedings in error or on appeal, and we suggest that, in view of the necessity for the early final decision of these cases, pro- ceedings in error or by appeal should be confined within the narrowest limits consistent with a proper, regard for the rights of the parties. The purpose in the preparation of this bill has been to provide a limit, with the fewest possible formalities, and adapted to a prompt decision of the questions which may arise, with a view to relieving im- porters and the government from the uncertainties and annoyances to which they are now subjected. In the preparation of this bill, and of the drafts of the administrative sections of the tariff law, to which we have recommended amendments, the Commission has had the advantage of the experience and knowledge of Commissioner McMahon, as these drafts were completed before his decease, and we may add that all of them met with his hearty approval. His long experience as a customs officer and thorough knowledge of customs affairs induced the Commission to give great weight to his opinions, and to rely on his recommendations as to these matters, and we believe that investigation will demonstrate the wisdom of the pro- posed changes. CONCLUSION. The Commission recommends that the bill shall specifically provide for the repeal of the sections of the law as to which amendments are herein proposed, if said amendments are adopted, and that all other sections of the customs laws now existing shall be re-enacted as part of the act proposed by the Commission, so as to save any question as to REPORT OF THE TARIFF COMMISSION. 45 the effect of the words “not specially enumerated or provided for in the act.” That the act of February 8, 1875, entitled, .“An act to amend existing customs laws and internal-revenue laws, and for other pur- poses,” except the proviso to section three, the proviso to section four and sections ten and eleven be repealed, and that the proviso to section three be changed to conform to the date of the passage of the bill pro- posed by the Commission. In many instances the classifications and rates of duties in the sched- ules attached to the report are not satisfactory to'all the members of the Commission, but in each instance they received the assent of a majority, and as a whole the report of the Commission is concurred in by all of its members except as hereinafter stated. First. Commissioner Underwood does not concur in the recommenda- tion for the establishment of a customs court. Second. Commissioners Ambler, Porter, and Underwood do not con- cur in the recommendation for the continuance of compound duties in any case. ‘ . Third. Commissioner Ambler does not concur in recommending the abolition of duties on what are known as “ dutiable costs and charges,” believing these costs and charges to be part of the proper cost of the goods. Fourth. Commissioners Garland and Ambler recommend the adoption of a system of valuation of goods, subject to ad valorem duties, based on the value of the goods in the markets of the United States at the date of their importation, duties unpaid, instead of the present system, for reasons which will be found set forth in the statement of Hon. H. F. French, Assistant Secretary of the Treasury, made before the Commis- sion. JOHN L. HAYES, HENRY W. OLIVER, Jr., A. M. GARLAND, J. A. AMBLER, ? ROBERT P. PORTER, J. W. H. UNDERWOOD, ALEX’R R. BOTELER, DUNCAN F. KENNER, Commissioners. APPENDIX TO THE REPORT OF THE TARIFF COMMISSION. PROPOSED SCHEDULE OF DUTIES. Schedule A. — Chemical products. Glue, twenty per centum ad valorem. Beeswax, twenty per centum ad valorem. Gelatine and all similar preparations, thirty per centum ad valorem. Glycerine, crude, two cents per pound. Glycerine, refined, five cents per pound. Phospliorus, ten cents per pound. Soap, hard and soft, all which are not otherwise specially enumerated or provided for in this act, and castile soap, two cents per pound. Fancy, perfumed, and all descriptions of toilet soaps, fifteen cents per pound. Sponges, twenty per centum ad valorem. Sumac, one-half of one cent per pound. Acid, acetic, acetous, or pyroligneous acid, not exceeding the specific gravity of 1.047, two cents per pound; exceeding the specific gravity of 1.047, ten cents per pound. Acid, citric, ten cents per pound. Acid, tartaric, ten cents per pound. Camphor, refined, five cents per pound. Castor beans, or seeds, thirty cents per bushel of fifty pounds. Castor oil, fifty cents per gallon. Cream of tartar, six cents per pound. Dextrine, burnt starch, gum substitute, or British gum, ten per centum ad valorem. Glucose, or grape sugar, twenty-five per centum ad valorem. Indigo, extracts of, and carmined, ten per centum ad valorem. Iodine, resublimed, forty cents per pound. Liquorice, paste or roll, six cents per pound ; liquorice juice, three cents per pound. Oil of bay-leaves, essential, or bay rum essence or oil, two dollars and fifty cents per pound. Oil, croton, fifty cents per pound. Oil, flaxseed or linseed, twenty five cents per gallon, seven and one- half pounds weight to be estimated as a gallon. Hemp seed, and rape seed oil, ten cents per gallon. Soda and potassa, tartrate, or rochelle salt, five cents per pound. Strychnia, or strychnine, and all salts thereof, fifty cents per ounce. Tartars, partly refined, including lees crystals, four cents per pound. Acidulated phosphate of lime, ainmoniated or otherwise, three dol- lars per ton. Alumina, alum, patent alum, alum substitute 7 sulphate of alumina, and aluminous cake and alum in crystals or ground, sixty cents per hundred pounds. H. Mis. 6 4 50 REPORT OF I'HE TARIFF COMMISSION. Ammonia, anhydrous, liquefied by pressure, twenty per centum ad valorem. Ammonia aqua, or water of ammonia, twenty per centum ad va- lorem. Ammonia, muriate of, or sal-ammoniac, ten per centum ad valorem. Ammonia, carbonate of, twenty per centum ad valorem. Ammonia, sulphate of, twenty per centum ad valorem. All imitations of natural mineral waters and all wholly artificial mineral waters, thirty per centum ad valorem. Asbestos, manufactured, twenty per centum ad valorem. Baryta, sulphate of, or barytes, unmanufactured, ten per centum ad valorem. Baryta, sulphate of, or barytes, manufactured, twenty per centum ad valorem. Refined borax, three cents per pound. Cement, Roman, Portland, and all others, twenty per centum ad valorem. Whiting and Paris white, dry, twenty per centum ad valorem; ground in oil, one and one-half cents per pound. • ’ Putty, one cent per pound. Prepared chalk, precipitated chalk, French chalk, red chalk, and all other chalk preparations which are not specially enumerated or provided for in this act, twenty per centum ad valorem. Chromic acid, fifteen per centum ad valorem. Chromate of potash, four cents per pound. Bi-chromate of potash, four cents per pound. Cobalt, oxide of, twenty tier centum ad valorem. Copper, sulphate of, or blue vitriol, three cents per pound. Iron, sulphate of, or copperas, one-quarter of one cent per pound. Acetate of lead, brown, three cents per pound. Acetate of lead, white, five cents per pound. White lead, when dry or in pulp, two cents per pound. When ground or mixed in oil, two and one-lialf cents per pound. Litharge, two cents per pound. Orange mineral, and red lead, two and one-half cents per pound. Nitrate of lead, three cents per pound. Magnesia, medicinal, carbonate of, five cents per pound. Magnesia, calcined, ten cents per pound. Magnesia, sulphate of, or Epsom salt, one-half of one cent per pound. Potash, crude, carbonate of, or fused, saleratus, calcined or pearl ash, and caustic potash, twenty per centum ad valorem. Chlorate of, three cents per pound. Hydriodate of, fifty cents per pound. Iodide of, fifty cents per pound. Iodate of, fifty cents per pound. Prussiateof, red, ten cents per pound. Prussiate of, yellow, five cents per pound. Nitrate of, or saltpetre, crude, one-half of one cent per pound. Nitrate of, or refined, one cent per pound. Sulphate of, twenty per centum ad valorem. Soda: Soda ash, one quarter of one cent per pound. Soda, sal, or soda crystals, one quarter of one cent per pound. Bi carbonate of, or super-carbonate of, one and one-half cents per pound. Hydrate or caustic, one cent per pound. REPORT OF THE TARIFF COMMISSION. 51 Soda : Snlpliate, known as salt cake, crude or refined, or nitre cake, crude or refined, and Glauber’s salt, one quarter of one cent per pound. Sulphur: Refined, in rolls, ten dollars per ton. Sublimed, or flowers of, twenty dollars per ton. Wood tar, ten per centum ad valorem. Coal tar, ten per centum ad valorem. Coal tar, naphtha, benzine, benzole, dead oil, and pitch, asphaltum, or bitumen, twenty per centum ad valorem. All coal tar colors or dyes, by whatever name known, and not herein specially enumerated or provided for in this act, forty per centum ad valorem. All preparations of coal tar not colors or dye, not otherwise provided for, twenty per centem ad valorem. Ultramarine, five cents per pound. Turpentine, spirits of, twenty cents per gallon. Colors and paints, including lakes, whether dry or mixed, or ground with water or oil, and not specially enumerated or provided for in this act, twenty-five per centum ad valorem. The pigment known as bone black, and ivory drop black, twenty- five per centum ad valorem. Bone char, or bone black, fit for sugar refining, one quarter of one cent per pound. Ochre and ochery earths, umber, and umber earths, and sienna and sienna earths, when dry, one-half of one cent per pound : when ground in oil, one. and one-half cents per pound. Zinc, oxide of, when dry, one cent per pound. Zinc, oxide of, when ground in oil, two cents per pound. All preparations known as essential oils, expressed, oils, distilled oils, rendered oils, alkalis, alkaloids, and all combinations of any of the foregoing, and all chemical compounds and salts, by whatever name known, and not specially enumerated or provided for in this act, twenty-five per centum ad valorem. Preparations : all medicinal preparations known as cerates, conserves, decoctions, emulsions, extracts, solid or fluid ; infusions $ juices, liniments, lozenges, mixtures, mucilages, ointments, oleo-resins, pills, plasters, powders, resins, suppositories, syrups, vinegars, and waters ; of any of which alcohol is not a component part and not specially enumerated or provided for in this act, twenty-five per centum ad valorem. All barks, beans, berries, balsams, buds, bulbs and bulbous-roots, and excrescences, such as nutgalls, fruits, flowers, dried fibres, grains, gums and gum-resins, herbs, leaves, lichens, mosses, nuts, roots and stems, spices, vegetables, seeds (aromatic, not garden seeds), and seeds of morbid growth, weeds, woods used expressly for dyeing, and dried insects, any of the foregoing of which are not edible, but which have been advanced in value or condition by refining or grinding, or by other process of manufacture, and not specially enumerated or provided for in this act, ten per centum ad valorem. All non-dutiable, crude minerals, but which have been advanced in value or condition by refining or grinding, or by other jirocess of manufacture, not specially enumerated or provided for in this act, ten per centum ad valorem. All ground or powdered spices not specially enumerated or provided for in this act, five cents per pound. 52 REPORT OF THE TARIFF COMMISSION. Ail earths or clays, un wrought or unmanufactured, not specially enu- merated or provided for in this act, one dollar and fifty cents per ton. All earths or clays, wrought or manufactured, not specially enumerated or provided for in this act, three dollars per ton ; china clay, or kaoline, three dollars per ton. Proprietary preparations, to wit, all — Cosmetics, pills, powders, troches or lozenges, syrups, cordials, hitters, anodynes, tonics, plasters, liniments, salves, ointments, pastes, drops, waters, essences, spirits, oils, or preparations or com- positions recommended to the public as proprietary articles, or pre- pared according to some private formula as remedies or specifics for any disease or diseases, or affections whatever, affecting the human or animal body, including all toilet preparations whatever used as applications to the hair, mouth, teeth, or skin, not spe- cially enumerated or provided for in this act, fifty per centum ad valorem. Alcoholic preparations : Alcoholic perfumery and cologne water, seventy-five per centum ad valorem. Chloroform, fifty cents per pound. Collodion, and all preparations of, by whatever name known, fifty cents per pound, Boiled or in sheets, but not made up into arti- cles, sixty cents per pound. Ether, sulphuric, fifty cents per pound. Hoffman’s anodyne, thirty cents per pound. Iodoform, one dollar per pound. Acid, tannic and tannin, fifty cents per pound. Spirits, nitrous ether, thirty cents per pound. Santonin, two dollars per pound. Preparations: All medicinal preparations known as essences, ethers, extracts, mixtures, spirits, tinctures, and medicated wines, of which alcohol is a compound part, not specially enumerated or provided for in this act, fifty cents per pound. Varnishes of all kinds, fifty per centum ad valorem. Opium, one dollar per pound, prepared for smoking; and all other preparations of opium not specially enumerated or jjrovided for in this act, six dollars per pound ; but opium prepared for smoking, and other preparations of opium deposited *n bonded warehouses shall not be removed therefrom for exportation without payment of duties, and such duties shall not be refunded. Opium, aqueous extract of, for medicinal use, and tincture of, as laud- anum, and all other liquid preparations of opium, not specially enumerated or provided for in this act, forty per centum ad valorem. Morphia or morphine, and all salts thereof, one dollar per ounce. Schedule B. — Earthenware and glassware. Brown earthen ware, common stone-ware, gas retorts, and stone ware not ornamented, twenty-five per centum ad valorem. China, porcelain, parian, and bisque ware, including plaques, orna- ments, charms, vases, and statuettes, painted, printed, and gilded, or otherwise decorated or ornamented in any manner, sixty-five per centum ad valorem. China, porcelain, parian, and bisque ware, plain white, and not orna- mented or decorated in any manner, sixty per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 53 All other earthen, stone, and crockery ware, white, glazed, edged, printed, painted, dipped, or cream-colored, composed of earthy or mineral substances, not specially enumerated or provided for in this act, fifty -five per centum ad valorem. Stone ware, above the capacity of ten gallons, twenty per centum ad valorem. Encaustic tiles, thirty-five per centum ad valorem. Brick, fire-brick, and roofing and paving tile, not specially enumer- ated or provided for in this act, twenty per centum ad valorem. Slates, slate pencils, slate chimney pieces, mantels, slabs for tables, and all other manufactures of slate, thirty per centum ad valorem. Roofing slates, twenty-five per centum ad valorem. Green and colored glass bottles, vials, demijohns, and carboys (cov- ered or uncovered), pickle or preserve jars, and other plain, molded, or pressed glass, not cut, engraved, or painted, and not specially enumerated or provided for in this act, one and one-half cents per pound; if filled, and not otherwise in this act provided for, said articles shall pay on their weight, exclusive of contents, one and one half cents per pound in addition to the duty on the contents. Flint and lime glass bottles and vials, and other plain, molded, or pressed flint or lime glass-ware, not specially enumerated or pro- vided for in this act, two cents per pound ; if filled, and not other- wise in this act provided for, said articles shall pay on their weight, exclusive of contents, two cents per pound in addition to the duty on the contents. Articles of glass, cut, engraved, painted, colored, printed, stained, silvered, or gilded, not including plate glass silvered, or looking- glass plates, fifty per centum ad valorem. Unpolished cylinder, crown, and common window-glass, not exceeding ten by fifteen inches square, one cent and one-half per pound; above that, and not exceeding sixteen by twenty-four inches square, two cents per pound ; above that, and not exceeding twenty-four by thirty inches square, two and one-half cents per pound; all above that, three cents per pound : Provided, that unpolished cylinder, crown, and common window-glass, imported in boxes containing fifty square feet, as nearly as sizes will permit, now known and commercially des- ignated as fifty feet of glass, single thick and weighing not to exceed fifty-five pounds of glass per box, shall be entered and computed as fifty pounds of glass only; and that said kinds of glass imported in boxes containing, as nearly as sizes will permit, fifty feet of glass, now known and commercially designated as fifty feet of glass, dou- ble thick and not exceeding ninety pounds in weight, shall be en- tered and computed as eighty pounds of glass only ; but in all other cases the duty shall be computed according to the actual weight of glass. Cast polished plate glass, unsilvered, not exceeding ten by fifteen inches square, three cents per square foot ; above that, and not exceeding sixteen by twenty-four inches square, five cents per square foot; above that, and not exceeding twenty-four by thirty inches square, eight cents per square foot ; above that, and not ex- ceeding twenty-four by sixty inches square, twenty-five cents per square foot; all above that, fifty cents per square foot. Cast polished plate glass, silvered, or looking-glass plates, not ex- ceeding ten by fifteen inches square: four cents per square foot; above that, and not exceeding sixteen by twenty-four inches square: six cents per square foot; above that, and not exceeding twenty- 54 REPORT OF THE TARIFF COMMISSION. four by thirty inches square : ten cents per square foot ; above that, and not exceeding twenty-four b}^ sixty inches square: thirty-five cents per square foot ; all above that, sixty cents per square foot. But no looking-glass plates or plate glass, silvered, when framed, shall pay a less rate of duty than that imposed upon similar glass of like description not framed, but shall be liable to pay, in addi- tion thereto: thirty per centum ad valorem, upon such frames. Porcelain and Bohemian glass, painted glassware, stained glass, and all other manufactures of glass or of which glass shall be the com- ponent material of chief value, not specially enumerated or pro- vided for in this act, forty -five per centum ad valorem. Schedule C. — Metals. Iron ore, including manganiferous iron ore, also the dross or re- siduum from burnt pyrites : fifty cents per ton ; as pyrites or sul- phuret of iron in its natural state, containing less than fifteen per centum of silica: fifty cents per ton, and in addition thereto two and one-half cents per pound for the copper contained therein. Oxide of manganese, fifty cents per ton. Iron in pigs, iron kentledge, spiegeleisen, wrought and cast scrap iron, and scrap steel of every description, including old iron and old steel railway bars, steel filings, borings, turnings, steel railway bars crop ends, none of which shall exceed twenty-four inches in length, steel ingot, cogged ingot, bloom, slab, and billet crop ends, none of which shall exceed five inches in length : three-tenths of one cent per pound. Provided , That nothing shall be deemed scrap iron or scrap steel except waste or refuse iron or steel that has been in actual use and is fit only to be remanufactured by remelting or rerolling. Steel iugots, cogged ingots, blooms and slabs, made by the Bessemer, pneumatic, Thomas-Gilchrist, basic, Siemens- Martin, open hearth, or by any other process except the crucible process, weighing not less than five hundred pounds each and measuring not less than five inches square nor less than five inches in least diameter of cross sec- tion of the ingots, cogged ingots, or blooms, nor less than five inches in thickness nor ten inches in width of the slabs: six-tenths of one cent per pound. Iron railway bars, weighing more than twenty-live pounds to the yard : seven-tenths of one cent per pound. Steel railway bars and railway bars made impart of steel, weighing more than twenty-five pounds to the yard: eight-tenths of one cent per pound. Bar iron, rolled or hammered, comprising flats not less than one inch wide, nor less than three eighths of one inch thick: nine-tenths of one cent per pound ; comprising round iron not less than three- fourths of one inch in diameter, and square iron not less than three- fourths of one inch square: one cent per pound; comprising flats less than one inch wide, or less than three eighths of one inch thick ; round iron less than three-fourths of one inch, and not less than seven- sixteenths of one inch in diameter, and square iron less than three-fourths of one inch square: one cent and two-tenths of one cent per pound. Provided , That all iron in slabs, blooms, loops, or other forms less fin- ished than iron in bars, and more advanced than pig-iron, except castings, shall be rated as iron in bars, and pay a duty accordingly; and none f the above iron shall pay a less rate of duty than thirty- five per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 55 Iron or steel tee rails, weighing not over twenty-five pounds to the yard, and iron or steel flat rails, punched : one and two-tenths of one cent per pound. Round iron, in coils or rods, less than seven-sixteenths of one inch in diameter, and bars or shapes of rolled iron not specially enumerated or provided for in this act : one and one-lialf of one cent per pound. Armor, or other plate, iron or steel, or combination of iron and steel, finished or unfinished, not less than one and a half inches thick : two and one-lialf of one cent per pound. Boiler, or other plate iron, sheared or uusheared, skelp iron, sheared or rolled in grooves, and sheet iron, common or black, thinner than one inch and one-half, and not thinner than number twenty wire gauge: one and three-tenths of one cent per pound ; thinner than number twenty wire gauge, and not thinner than number twenty- five wire gauge : one and one-half of one cent per pound ; thinner than number twenty-five wire gauge, and not thinner than number twenty-nine wire gauge: one and seven-tenths of one cent per pound; thinner than number twent5^-nine wire gauge, and all iron commercially known as common or black taggers’ iron, whether put up in boxes or bundles or not: one and nine-tenths of one cent per pound. Polished, planished, or glanced sheet-iron, or sheet steel, by what- ever name designated: three cents per pound. Provided , that plate or sheet or taggers’ iron, by whatever name des- ignated, other than the polished, planished, or glanced herein pro- vided for, which has been pickled or cleaned by acid, or by any other material or process, or which is cold rolled, or singled rolled, or smoothed by rolling, shall pay one-half cent per pound more duty than the corresponding gauges of common or black sheet or taggers’ iroD. Iron or steel sheets, or plates, or taggers’ iron, coated with t in or lead, or with a mixture of which these metals are a component part, by the dipping or any other process, and commercially known as tin plates, terne plates, and taggers’ tin : two and two-tenths of one cent per pound ; corrugated or crimped sheet-iron or steel : one and nine- tenths of one cent per pound. Provided , that all shapes or blanks, of sheet or plate, or skelp-iron, if not specially enumerated or provided for in this act, shall pay one-half cent per pound more duty than is imposed upon the material of which such shapes or blanks are made. Hoop, or band, or scroll, or other iron, without reference to length, and by whatever name called, eight inches or less in width and not thinner than number ten wire guage: one and two- tenths of one cent per pound : thinner than number ten wire guage and not thinner than number seventeen wire guage : one and four-tenths of one cent per pound ; thinner than number seventeen wire gauge: one and six-tenths of one cent per pound, Provided , That all articles not specially enumerated or provided for in this act, whether wholly or partly manufactured, made from the hoop, band, or scroll iron herein provided for, or of which such hoop, band, or scroll iron shall be the material of chief value, shall pay one-fourth of one cent per pound more duty than that imposed on the iron from which they are made, or which shall be such material of chief value. Iron and steel cotton ties, or hoops for baling purposes, not thinner than number nineteen wire-gauge: one and four-tenths of one cent per pound. 56 REPORT OF THE TARIFF COMMISSION. Cast-iron pipe of every description : one cent per pound. Casting’s of iron, not specially enumerated or provided for in this act: one and one quarter of one cent per pound. Cut nails and spikes, of iron or steel: one and one-quarter of one cent per pound. Iron or steel railway fish-plates, or splice bars: one and one-half of one cent per pound. Malleable iron castings, not specially enumerated or provided for in this act: two cents per pound. Wrought iron or steel spikes, nuts, and washers, and horse, mule, or ox shoes : two cents per pound. Anvils : two cents per pound. Iron or steel rivets, bolts, with or without threads or nuts, or bolt blanks, and finished hinges or hinge blanks : two and one-half of one cent per pound. Iron or steel blacksmiths’ hammers and sledges, track tools, wedges, and crowbars: two and one-half of one cent per pound. Iron or steel axles, parts thereof, axle bars, axle blanks, or forgings for axles, without reference to the stage or state of manufacture : two and one-half of one cent per pound. Forgings of iron and steel, or forged iron, of whatever shape or in whatever stage of manufacture, not specially enumerated or pro- vided for in this act : two and one- half of one cent per pound. Horseshoe nails, hob-nails, and wire nails, and all other w rought iron or steel nails, not specially enumerated or provided for in this act: four cents per pound. Boiler tubes, or flues, or stays, of wrought iron or steel: three cents per pound. Other wrought iron or steel tubes or pipes: two and one-quarter of one cent per pound. Chain or chains of all kinds, made of iron or steel, not less than three- fourths of one inch in diameter: two cents per pound; less than three-fourths of one inch and not less than three-eighths of one inch in diameter: two and one-quarter of one cent per pound; les.sthan three-eighths of one inch in diameter: three cents per pound. Cross-cut saws: eight cents per lineal foot. Mill, pit, and drag saws, not over nine inches wide: ten cents per lin- eal foot; over nine inches wide: fifteen cents per lineal foot. Circular saws: thirty per centum ad valorem. * Hand, back, and all other saws, not specially enumerated or provided for in this act: forty per centum ad valorem. Files, file blanks, rasps, and floats of all cuts and kinds, four inches in length and under: thirty-five cents per dozen ; over four inches in length and under nine inches: seventy five cents per dozen; nine inches in length and under fourteen inches : one dollar and fifty cents per dozen ; fourteen inches in length and over : two dollars and fifty cents per dozen. Steel ingots, cogged ingots, blooms, and slabs, weighing less than five hundred pounds each, and measuring less than five inches square or less than five inches in greatest diameter of cross-section of the in- gots, cogged ingots, or blooms, and less than five inches in thick- ness or less than ten inches in width of the slabs ; die blocks or blanks; billets and bars, and tapered or beveled bars; bands, strips, and sheets of all gauges and widths; plates of all thicknesses and widths; steamer, crank, andother shafts; wrist or crank pins; connecting rods and piston rods, pressed, sheared, or stamped REPORT OF THE TARIFF COMMISSION. 57 shapes, or blanks of sheet or plate steel, or combination of steel and iron, punched or not punched ; hammer molds or swaged steel; gun molds not in bars; alloys used as substitutes for steel tools ; all descriptions and shapes of dry sand, loam, or iron molded steel castings ; all of the above valued at five cents per pound or less : two cents per pound ; valued above five cents and not above nine cents per pound : two and three-quarters of one cent per pound ; valued at above nine cents per pound: three and one-half cents per pound. Provided , that on all iron or steel bars, rods, strips, or sheets, of whatever shape, and on all iron or steel of irregular shape or sec- tion, cold-rolled, cold-hammered, or polished in any way in addition to the ordinary process of hot rolling or hammering, and on steel circular saw plates, there shall be paid one cent per pound in addi- tion to the rates provided in this act. Iron or steel beams, girders, joists, angles, channels, car- truck chan- nels, tees, columns and posts, or parts or sections of columns or posts, deck and bulb beams, and building forms, together with all other structural shapes of iron or steel : one and one-half of one cent per pound. Steel wheels for railway purposes, whether wholly or partly finished, and iron or steel locomotive, car, and other railway tires, or parts thereof, wholly or partly manufactured, or iron or steel ingots, cogged ingots, blooms, or blanks for the same, without regard to the degree of manufacture : two and three-quarters of one cent per pound. Steel rivet, screw, nail, fence, and wire rods, round, in coils and loops, not lighter than number five wire gauge, and valued at three cents per pound, or less : one cent per pound. Crucible cast-steel rivet, screw, nail, fence, and wire rods, round, in coils and loops, not lighter than number five wire gauge, and valued above three cents, and not above five cents per pound: one and three quarters of one cent per pound : valued above five cents, and not above nine cents per pound : two and one-half cents per pound ; valued above nine cents per pound : three cents per pound. Iron or steel screws, commonly called wood screws, two inches or over in length: six cents per pound; over one inch and less than two inches in length : eight cents per pound ; one inch and less in length : nine cents per pound. Iron or steel wire, not smaller than number ten wire gauge : two and one-quarter cents per pound ; smaller than number ten and not smaller than number eighteen wire gauge: two and three-quarter cents per pound ; smaller than number eighteen and not smaller than number twenty-six wire gauge: three and one-quarter cents per pound ; smaller than number twenty-six wire gauge: four cents per pound. Provided , That iron or steel wire covered with cotton, silk, or other material, and wire commonly known as crinoline, corset, and hat wire, shall pay four cents per pound in addition to the foregoing rates. And provided further, that no article made from iron or steel wire, or of which iron or steel wire is a component part of chief value, shall pay a less rate of duty than the iron or steel wire from which it is made either wholly or in part; and provided further, that iron or steel wire cloths, and iron or steel wire nettings, made in meshes of any form, shall pay a duty equal in amount to that imposed on iron or steel wire of the same gauge, and three cents per pound in 58 REPORT OF THE TARIFF COMMISSION. addition thereto; and provided further, that wire rope and wire strand, of iron or steel wire, shall pay the same rates of duty that are levied on the wire of which they are made ; provided, that on all of the kinds of iron or steel, or articles or manufactures of iron or steel, hereinbefore in this act enumerated, wheu galvanized, or coated with any metal, or compound, alloy, or mixture of metals, by any process whatsoever, there shall be paid (excepting on what are known commercially as tin plates, terne plates, and taggers* tin, and hereinbefore provided for) : one cent per pound in addition to the rates provided in this act. Steel in any form, not specially enumerated or provided for in this act: three cents per pound. Provided , That all metal produced from iron or its ores, which is cast and malleable, of whatever description or form, without regard to the percentage of carbon contained therein, whether produced by cementation, or converted, cast, or made from iron or its ores, by the crucible, Bessemer, pneumatic, Thomas-Gilchrist, basic, Siemens-Martin, or open-hearth process, or by the equivalent of either, or by the combination of two or more of the processes, or their equivalents, or by any fusion or other process which produces from iron or its ores a metal either granular or fibrous in struct- ure, which is cast and malleable, excepting what is known as mal- leable iron castings, shall be classed and denominated as steel. No allowance or reduction of duties for partial loss or damage, in consequence of rust or of discoloration shall be made upon any description of iron or steel, or upon any partly manufactured arti- cle of iron or steel, or upon any manufacture of iron or steel. On all iron or steel, and on all manufactures, wares, utensils, vessels, and articles of iron or steel, or of which such metals or either of them shall be the component part of chief value, whether wholly or partly manufactured, there shall be levied, collected, and paid no less rate of duty than the highest duty or rate of duty imposed upon any part of said goods in any of the forms in which it or they existed prior to or during their passage into the form or article oa which the duty is to be levied. This shall not apply to nor in any manner affect the articles specially enumerated or provided for in this act, but shall apply to all other manufactures of iron or steel, or of which iron or steel shall be the component material or part of chief value. If two or more rates of duty should be applicable to any imported article, it shall be classified for duty under the highest of such rates, and in all cases of doubt as to the classification for duty of an imported article, such article shall be classified at the highest rate of duty. Argentine, albata or German silver unmanufactured : twenty-five per centum ad valorem. Copper, imported in the form of ores, and copper cement : two and one-lialf cents on each pound of fine copper contained therein ; reg- ulus of and black or coarse copper: three and one-half cents on each pound of fine copper contained therein ; old copper, fit only for remanufacture, clippings from new copper, brass, in bars or pigs, old brass, and clippings from brass or Dutch metal, and all composition metal of which copper is a component material of chief value: three and one half cents per pound; in plates, bars, ingots, Chili or other pigs, and in other forms not manufactured, or euum- REPORT OF THE TARIFF COMMISSION. 59 erated in this act : four cents per pound ; in rolled plates, called brazier’s copper, sheets, rods, pipes, and copper bottoms, and all manufactures of copper, or of which copper shall be a component of chief value, not specially enumerated or provided for in this act: thirty-five per centum ad valorem. Lead ore, and lead dross : oue cent per pound. Lead, in pigs and bars, molten and old refuse lead run into blocks and bars, and old scrap lead, fit only to be remanufactured : one and one-half cents per pound. Lead, m sheets, pipes, or shot: two and one-quarter cents per pound. Nickel, in ore, matte, or other crude form not ready for consumption in the arts : twenty cents per pound on the nickel contained therein. Nickel, nickel oxide, alloy of any kind in which nickel is the element of chief value, and ingots, sheets, or other forms of iron or other metal, covered or plated with nickel, and wares made of metal so covered or plated : twenty five cents per pound. Cobalt, oxide of, thirty cents per pound. Zinc, spelter, or tuteuegue, in blocks or pigs, and old worn-out zinc, fit only to be remanufactured: one and one-quarter cents per pound; zinc, spelter, or tutenegue in sheets, two cents per pound. Sheathing, or yellow metal, not wholly of copper, nor wholly nor in part of iron, ungalvanized, in sheets forty-eight inches long and fourteen inches wide, and weighing from fourteen to thirty -four ounces per square foot : three cents per pound. Antimony, as regulus or metal: ten per centum ad valorem. Bronze powder: fifteen per centum ad valorem. Cutlery, not specially enumerated or provided for in this act: thirty- five per centum ad valorem. Dutch or bronze metal, in leaf: ten per centum ad valorem. Steel plates, engraved, stereotype plates, and new types: twenty-five per centum ad valorem. Gold leaf: one dollar and fifty cents per package of five hundred leaves. Hollow ware, coated, glazed, or tinned : three cents per pound. Muskets, rifies, and other fire-arms: twenty-five per centum ad val- orem. Needles, for knitting or sewing machines: thirty-five per centum ad valorem. Needles, sewing, darning, knitting, and all others not specially enu- merated or provided for in this act: twenty-five per centum ad valorem. Pen knives, and pocket-knives of all kinds, and swords, sword blades, and side arms: fifty per centum ad valorem. Pens, metallic, pen-tips and pen-holders, or parts thereof : forty per centum ad valorem. Pins, solid head or other: thirty per centum ad valorem. Britannic ware, and plated and gilt articles and wares of all kinds: thirty-five per centum ad valorem. Quicksilver: ten per centum ad valorem. Silver leaf: seventy-five cents per package of five hundred leaves. Type metal: twenty per centum ad valorem. Chromate of iron, or chromic ore: fifteen per centum ad valorem. Metallic substances in a crude state, and metals un wrought, not specially enumerated or provided for in this act: twenty per centum ad valorem. 60 REPORT OF THE TARIFF COMMISSION. Manufactures, articles or wares, not specially enumerated or provided for in this act, composed wholly or in part of iron, steel, copper, lead, nickel, pewter, tin, zinc, gold, silver, platinum, or any other metal, and whether partly or wholly manufactured: forty -five per centum ad valorem. Schedule D. — Wood and wooden wares. Timber, hewn and sawed, and timber used for spars and in building wharves, twenty per centum ad valorem. Timber, squared or sided, not specially enumerated or provided for in this act, one cent per cubic foot. Sawed boards, plank, deals, and other lumber of hemlock, white wood, sycamore, and bass wood, one dollar per one thousand feet, board measure ; all other articles of sawed lumber, two dollars per one thousand feet, board measure. But when lumber of any sort is planed or finished, in addition to the rates herein provided, there shall be levied and paid for each side so planed or finished, fifty cents per one thousand feet, board measure; And if planed on one side and tongued and grooved, one dollar per one thousand feet, board measure ; And if planed on two sides, and tongued and grooved, one dollar and fifty cents per one thousand feet, board measure. Hubs tor wheels, posts, last blocks, wagon blocks, ore blocks, gun blocks, heading blocks, and all like blocks or sticks, rough-hewn, or sawed only, twenty per centum ad valorem. Staves of wood of all kinds, ten per centum ad valorem. Pickets and palings, twenty per centum ad valorem. Laths, fifteen cents per one thousand pieces. Shingles, thirty-five cents per one thousand. % Pine clap boards, two dollars per one thousand. Spruce clap boards, one dollar and fifty cents per one thousand. House or cabinet furniture, in pieces or rough, and not finished, thirty per centum ad valorem. Cabinet ware and house furniture, finished, thirty-five per centum ad valorem. Casks and barrels, empty, sugar-box shooks, and packing boxes, and packing-box shooks, of wood, not specially enumerated or provided for in this act, thirty per centum ad valorem. Manufactures of cedar- wood, granadilla, ebony, mahogany, rosewood, and satin wood, thirty-five per centum ad valorem. Manufactures of wood, or of which wood is the chief component part, not specially enumerated or provided for in this act, thirty-five per centum ad valorem. Wood, unmanufactured, not specially enumerated or provided for in this act, twenty per centum ad valorem. Schedule E. -Sugar. All sugars not above No. 13 Dutch standard in color, shall pay duty on their polariscopic test, as follows, viz: All sugars not above No. 13 Dutch standard in color, all tank bot- toms, sirups of cane juice, or of beet juice, melada, concentrated melada, concrete and concentrated molasses, testing by the polari- scope not above seventy- five degrees, shall pay a duty of one and REPORT OF THE TARIFF COMMISSION. 61 fifty hundredths cents per pound, and for every additional degree or fraction of a degree shown by the polariscope test, they shall pay five hundredths of a cent per pound additional. All sugars above No. 13 Dutch standard in color, shall be classified by the Dutch standard of color, and pay duty as follows, viz : All sugars above No. 13 and not above No. 16 Dutch standard, three and one-quarter cents per pound. All sugar above No. 16 and not above No. 20 Dutch standard, three and seventy-five hundredths cents per pound. All sugars above No. 20 Dutch standard, four and one-quarter cents per pound. Molasses testing not above fifty -six degrees by the polariscope, shall pay a duty of five and one-half cents per gallon. Molasses testing above fifty-six degrees, shall pay a duty of ten cenls per gallon. Sugar candy, not colored, five cents per pound. All other confectionery, not specially enumerated or. provided for in this act, made wholly or in part of sugar, and on sugars after being refined, when tinctured, colored, or in any way adulterated, valued at thirty cents per pound or less, ten cents per pound. Confectionery valued above thirty cents jmr pound, or when sold by the box, package, or otherwise than by the pound, fifty per centum ad valorem. Schedule F. — Tobacco. Cigars, cigarettes, and cheroots of all kinds: three dollars per pound ; but paper cigars and cigarettes, including wrappers, shall be sub- ject to the same duties as are herein imposed upon cigars. Tobacco in leaf, unmanufactured, and not stemmed : thirty-five cents per pound. Tobacco-sterns, fifteen cents per pound. Tobaec# manufactured, of all descriptions, and stemmed tobacco, not specially enumerated or provided for in this act : fifty cents per pound. Snuff and snuff-flour, manufactured of tobacco; ground, dry or damp, and pickled, scented, or otherwise, of all descriptions: fifty cents per pound. Tobacco unmanufactured, not specially enumerated or provided for in this act : thirty per centum ad valorem. Schedule G. — Provisions. Animals, live, twenty per centum ad valorem. Beef and pork, one cent per pound. Hams and bacon, two cents per pound. Cheese, four cents per pound. Butter, and substitutes therefor, four cents per pound. Lard, two cents per pound. Wheat, twenty cents per bushel. Rye and barley, fifteen cents per bushel. Barley malt, per bushel of thirty -four pounds, twenty-five cents. Indian corn or maize, ten cents per bushel. Oats, ten cents per bushel. Corn-meal, ten cents per bushel of forty-eight pounds. Oat meal, one cent per pound. Rye-flour, one cent per pound. •Wheat-flour, twenty per centum ad valorem. 62 REPORT OF THE TARIFF COMMISSION. Potato or corn starch, one cent per pound. Rice starch, two and a half cents per pound. Other starch, two and a half cents per pound. Rice, cleaned, two and one-fourth cents per pound. Uncleaned, one and three-fourth cents per pound. Paddy, one and one-fourth cents per pound. Rice-flour, two and one-half cents per pound. Honey, twenty cents per gallon. Hops, eight cents per pound. Milk, preserved or condensed, twenty per centum ad valorem. Fish : Mackerel, one cent per pound. Herrings, pickled or salted, three-quarters of one cent per pound. Salmon, pickled, one cent per pound ; other fish pickled in barrels, one cent per pound. Foreign- caught fish, imported otherwise than in barrels or half bar- rels, whether fresh, smoked, dried, salted, or pickled, not specially enumerated or provided for in this act, fifty cents per hundred pounds. Anchovies and sardines, packed in oil or .otherwise, in tin boxes measuring not more than five inches long, four inches wide, and three and one-half inches deep, ten cents per whole box ; in half boxes, measuring not more than five inches long, four inches wide, and one and five-eighths deep, five cents each; in quarter boxes, measuring not more than four inches and three-quarters long, three and one-half inches wide, and one and a quarter deep, two and one- half cents each ; when imported in any other form, forty per centum ad valorem. Fish preserved in oil, except anchovies and sardines, thirty per centum ad valorem. * Salmon, and all other fish, prepared or ’preserved, and prepared meats of all kinds, not specially enumerated or provided for in this act, twenty -five per centum ad valorem. Pickles and sauces, of all kinds, not otherwise specially enumerated or provided for in this act, thirty -five per centum ad valorem. Potatoes, fifteen cents per bushel of sixty pounds. Yegetables, in their natural state, or in salt or brine, not specially enumerated or provided for in this act, ten per centum ad valorem. Chicory root, ground or un ground, burnt or prepared, three cents per pound. Vinegar, seven and one-half cents per gallon. The standard for vin- egar shall be taken to be that strength which requires thirty-five grains of bicarbonate of potash to neutralize one ounce Troy of vin- egar, and all import duties that may be imposed by law on vinegar imported from foreign countries shall be collected according to this standard. Acorns, and dandelion root, raw or prepared, and all other articles used or intended to be used as coffee, or as substitutes therefor, not specially enumerated or provided for in this act, three cents per pound. Chocolate, prepared or unprepared, two cents per pound. . Cocoa, prepared or manufactured, two cents per pound. Fruits : Currants : Zante or other, one cent per pound. Hates, plums, and prunes, one cent per pound. REPORT OF THE TARIFF COMMISSION. 63 Fruits — C ou ti n ued. Figs, two cents per pound. Oranges, in boxes of capacity not exceeding two and one-half cubic feet, twenty-five cents per box ; in one-half boxes, capacity not ex- ceeding one and one-fourth cubic feet, thirteen cents per half box; in bulk, one dollar and sixty cents per thousand ; in barrels, capa- city not exceeding that of the 196 pounds flour barrel, fifty-five cents per barrel. Lemons, in boxes of capacity not exceeding two and one-half cubic feet, thirty cents per box ; in one-half boxes, capacity not exceed- ing one and one-fourth cubic feet, sixteen cents per half box ; in bulk, two dollars per thousand. Lemons and oranges, in packages, not specially enumerated or pro- vided for in this act, twenty per centum ad valorem. Limes, and grapes, twenty per centum ad valorem. Raisins, two cents per pound. Fruits, preserved in their own juices, and fruit juice, twenty per centum ad valorem. Sweetmeats, and jellies of all kinds, thirty-five per centum and val- orem. Nuts: Almonds, five cents per pound ; shelled, seven and one half cents per pound; filberts, and walnuts, of all kinds, three cents per pound. Peanuts or ground beans, one cent, per pound ; shelled, one undone- half cents per pound. Nuts, of all kinds, shelled or unshelled, not specially enumerated or provided for in this act, two ceuts per pound. Mustard, ground or preserved, in bottles or otherwise, ten cents per pound. ^ Schedule H. — Liquors. Champagne, and all other sparkling wines, in bottles containing each not more than one quart and more than one pint, six dollars per dozen bottles ; containing not more than one pint each, and more than one half pint, three dollars per dozen bottles; containing one half pint each, or less, one dollar and fifty ceuts per dozen bottles ; in bottles containing more than one quart each, in addition to six dollars per dozen bottles, at the rate of two dollars per gallon on the quantity in excess of one quart per bottle. Still wines, in casks, forty cents per gallon; in bottles, one dollar and sixty cents per case of one dozen bottles containing each not more than one quart and more than one pint, or twenty-four bottles con- taing each not more than one pint ; and any excess beyond these quantities found in such bottles shall be subject to a duty of five cents per pint or fractional part thereof; but no separate or addi- tional duty shall be collected on the bottles. Provided, That any wines imported containing more than twenty- four per centum of alcohol, shall be forfeited to the United States : Provided, also, that there shall be no allowance for breakage, leak- age, or damage on wines, liquors, cordials, or distilled spirits. Vermuth, the same duty as on still wines. Wines, brandy, and other spirituous liquors imported in bottles, shall be packed in packages containing not less than one dozen bottles in each package ; and all such bottles, except as specially enumerated or provided for in this act, shall pay an additional duty of three cents for each bottle. 64 REPORT OF THE TARIFF COMMISSION. Brand v, and other spirits manufactured or distilled from grain or other materials and not specially enumerated or provided for in this act, two dollars per proof gallon ; each and every gauge or wine-gallon of measurement shall be counted as at least one proof gallon ; and the standard for determining the proof of brandy and other spirits or liquors of any kind imported shall be the same as that which is defined in the laws relating to internal revenue ; but any brandy or other spirituous liquors imported in casks of less capacity than fourteen gallons shall be forfeited to the United States. On all compounds or preparations of which distilled spirits is a compo- nent part of chief value, not specially enumerated or i)rovided for in this act, there shall be levied a duty not less than that imposed upon distilled spirits. Cordials, liquors, arrack, absinthe, kirschwasser, ratafia, and other similar spirituous beverages or bitters, containing spirits, and not specially enumerated or provided for in this act, two dollars per proof gallon. No lower rate or amount of duty shall be levied, collected, and paid on brandy, spirits, and other spirituous beverages than that fixed by law for the description of first proof ; but it shall be increased in proportion for any greater strength than the strength of first proof; and all imitations of brandy or spirits or wines imported by any names whatever, shall be subject to the highest rate of duty provided for the genuine articles respectively intended to be repre- sented, and in no case less than one dollar per gallon. Bay-rum, or bay- water, whether distilled or compounded, one dollar per gallon of first proof, and in proportion for any greater strength than first-proof. Ale, porter, and beer, in bottles, or jugs of glass, stone, or earthen- ware, thirty-five cents per gallon ; otherwise than in bottles or jugs of glass, stone, or earthenware, twenty cents per gallon. Schedule I. — Cotton and cotton goods. Cotton threads, yarns, warps, warp yarn, for weaving, whether single or advanced beyond the condition of single by twisting two or more single yarns together, whether on beams, or in bundles, skeins, or cops, or in any other form, valued at not exceeding twenty-five cents per pound, seven and a half cents per pound ; valued at over twenty- five cents per pound, and not exceeding forty cents per pound, fif- teen cents per pound; valued at ‘over forty cents per pound, and not exceediug fifty cents per pound, twenty cents per pound ; val- ued at over fifty cents per pound, and not exceeding sixty cents per pound, twenty-five bents per pound ; valued at over sixty cents per pound, and not exceeding seventy cents per pound, thirty cents per pound ; valued at over seventy cents per pound, and not exceeding eighty cents per pound, thirty-six cents per pound ; valued at over eighty cents per pound, fifty per centum ad valorem. Cotton, manufactures of, unbleached, valued at eight cents or less per square yard, three cents per square yard ; valued at over eight cents per square yard, forty per centum ad valorem ; bleached, valued at ten cents or less per square yard, four cents per square yard ; valued at over ten cents per square yard, forty per centum ad valorem : colored, stained, painted, or printed, valued at fifteen cents or less per square yard, six cents per square yard ; valued at over fifteen cents per square yard, forty per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 65 Cotton velvet, cotton laces, gimps, and galloons, cotton shirts and drawers, woven or made on frames, cotton hosiery, cotton braids, in- sertings, laces, trimmings, and all manufactures of cotton not specially enumerated or provided for in this act, forty per centum ad valorem. Spool-thread of cotton, six cents per dozen spools, containing on each spool not exceeding one hundred yards of thread ; exceeding one hundred yardS, for every additional one hundred yards of thread on each spool or fractional part thereof in excess of one hundred yards, six cents per dozen. Schedule J. — Hemp, Jute, and Flax Goods. Flax straw, five dollars per ton. Flax, not hackled or dressed, twenty dollars per ton. Flax, hackled, known as u dressed line,” forty dollars per ton. Tow, of flax or hemp, ten dollars per ton. Hemp, manila, and other like substitutes for hemp, not specially enumerated or provided for in this act, twenty-five dollars per ton. Jute, sunn, sisal grass, and other vegetable substances, not specially enumerated or provided for in this act, and cordage, fifteen dollars per ton. Brown and bleached linens, ducks, canvas, paddings, cot bottoms, diapers, crash, huckabacks, handkerchiefs, lawns, or other manu- factures of flax, jute, or hemp, or of which flax, jute, or hemp shall be the component material of chief value, not specially enu- merated or provided for in this act, thirty-five per centum ad valorem. Flax, hemp, and jute yarns, for carpets, valued at twenty-four cents or less per pound, thirty per centum ad valorem ; valued at above twenty-four cents per pound, thirty-five per centum ad valorem. Flax or linen thread, twine, and pack-thread, and all manufactures of flax, or of which flax shall be the component material of chief value, not specially enumerated or provided for in this act, forty per centum ad valorem. Flax or linen laces and insertings, embroideries, manufactures of linen, if embroidered or tamboured in the loom or otherwise, by machinery or with the needle, or other process, and not specially enumerated or provided for in this act, forty per centum ad va- lorem. Burlaps, not exceeding sixty indhes in width, of flax, jute, or hemp, or of which flax, jute, or hemp, or either of them, shall be the com- ponent material of chief value (except such as may be suitable for bagging for cotton), thirty per centum ad valorem. Oil-cloth foundations, or floor cloth canvas, or burlaps, exceeding sixty inches in width, made of flax, jute, or hemp, or of which flax, jute, or hemp, or either of them, shall be the component material of chief value, forty per centum ad valorem. Gunny cloth, not bagging, valued at ten cents or less per square yard, three cents per pound; valued at over ten cents per square yard, four cents per pound. Bags and bagging, and like manufactures, not specially enumer- ated or provided for in this act (except bagging for cotton), com- posed wholly or in part of flax, hemp, jute, gunny cloth, gunny- bags, or other material, forty per centum ad volorem. H. Mis. 6 5 66 REPORT OF THE TARIFF COMMISSION. Bagging for cotton, or other manufactures not specially enumerated or provided for in this act, suitable to the uses for which cotton bagging is applied, composed in whole or in part of hemp, jute, flax, gunny-bags, gunny-cloth, or other- material, and valued at seven cents or less per square yard, oue and one-half cents per pound ; valued at over seven cents per square yard, two cents per pound. Tarred cables or cordage, three cents per pound. Untarred manila cordage, two and one-lialf cents per pound. All other untarred cordage, three and one-half cents per pound. Seines, six and one-half cents per pound. Sail duck, or canvas for sails, thirty per centum ad volorem. Bussia and other sheetings, of flax or hemp, brown or white, thirty- five per centum ad valorem. All other manufactures of hemp, or of which hemp shall be a compo- nent material of chief value, not specially enumerated or provided for in this act, thirty-five per centum ad valorem. Grass cloth, and other manufactures of jute, ramie, China, and sisal- grass, not specially enumerated or provided for in this act, thirty- five per centum ad valdrem. Schedule K. — Wool and woolens. All wools, hair of the alpaca, goat, and other animals, shall be divided, for the purpose of fixing the duties to be charged thereon, into the three following classes : Class 1, clothing wools. — That is to say, merino, mestiza, metz, or metis wools, or other wools of merino blood, immediate or remote, and wools of like character with any of the preceding, including such as have been heretofore usually imported into the United States from Buenos Ayres, New Zealand, Australia, Cape of Good Hope, Bussia, Great Britain, Canada, and elsewhere, and also in- cluding all wools not hereinafter described or designated in classes 2 and 3. Class 2, combing wools. — That is to say, Leicester, Cotswold, Lincoln- shire, Down combing wools, Canada long wools, or other like comb- ing wools of English blood, and usually known by the terms herein used, and also all hair of the alpaca, goat, and other animals. Class 3, carpet wools and other similar wools — such as Donskoi, native South American, Cordova, Valparaiso, native Smyrna, and includ- ing all such wools of like character as have been heretofore usually imported into the United States from Turkey, Greece, Egypt, Syria, and elsewhere. The duty on wools of all classes which shall be imported washed shall be twice the amount of the duty to which they would be sub- jected if imported unwashed; and the duty on wools of all classes which shall be imported scoured shall be three times the duty to which they would be subjected if imported unwashed. The duty upon wool of the sheep, or hair of the alpaca, goat, and other animals, which shall be imported in any other than ordinary con- dition, as now and heretofore practiced, or which shall be changed in its character or condition for the purpose of evading the duty, or which shall be reduced in value by the admixture of dirt or any other foreign substance, shall be twice the duty to which it would be otherwise subject. REPORT OF THE TARIFF COMMISSION. 67 Wools of the first class, the value whereof at the last port or place whence exported to the United States, excluding charges in such port, shall be thirty cents or less per pound, ten cents per pound. Wools of the same class, the value whereof at the last port or place whence exported to the United States, excluding charges in such port, shall exceed thirty cents per pound, twelve cents per pound . Wools of the second class, and all hair of the alpaca, goat, and other animals, the value whereof, at the last port or place whence ex- ported to the United States, excluding charges in such port, shall be thirty cents or less per pound, ten cents per pound 5 wools of the same class, the value whereof at the last port or place whence ex- ported to the United States, excluding charges in such port, shall exceed thirty cents per pound, twelve cents per pound. Wools of the third class, the value whereof, at the last port or place whence exported to the United States, excluding charges in such port, shall be twelve cents or less per pound, two and a half cents per pound ; wools of the same class, the value whereof, at the last port or place whence exported to the United States, excluding charges in such port, shall exceed twelve cents per pound, five cents per pound. Wools on the skin, the same rates as other wools, the quantity and value to be ascertained under such rules as the Secretary of the Treasury may prescribe. Sheep skins, and Angora goat-skins, raw or manufactured, imported with the wool on, washed or unwashed, thirty per centum ad valorem on the skins alone. Woolen rags, shoddy, mungo, waste, flocks, and all other substitutes for wool, twelve cents per pound. Woolen cloths, woolen .shawls, and all manufactured of wool of every description, made wholly or in part of wool, not specially enum- erated or provided for in this act, valued at not exceeding one dollar per pound, thirty cents per pound, and thirty-five per centum ad valorem; valued at above one dollar per pound, thirty five cents per pound, and in addition thereto forty per centum ad valorem. Flannels, blankets, hats of wool,. knit goods, and all goods made on knitting-frames, balmorals, woolen and worsted yarns, and all man- ufactures of every description, composed wholly or in part of worsted, the hair of the alpaca, goat, or other animals, except such as are composed in part of wool not otherwise provided for in this act, valued at not exceeding thirty cents per pound, eight cents per pound; valued at above thirty cents per pound and not exceed- ing forty cents per pound, twelve cents per pound; valued at above forty cents per pound, and not exceeding sixty cents per pound, eighteen cents per pound; valued at above sixty cents per pound, and not exceeding eighty cents per pound, twenty-four cents per pound ; valued at above eighty cents per pound, and not exceed- ing one dollar per pound, thirty cents per pound; and in addi- tion thereto, upon all the above named articles, thirty-five per centum ad valorem; valued at above one dollar per pound, thirty- five cents per pound, and in addition thereto forty per centum ad valorem. Bunting, twelve cents per square yard, and in addition thereto thirty- five per centum ad valorem. Women’s and children’s dress-goods, coat-linings, Italian cloths, and goods of like description, now and heretofore kuown as worsted stuffs, the warp of which is made w r holly of cotton, linen, ramie, 6 8 REPORT OF THE TARIFF COMMISSION. China grass, or other vegetable materials, or of a combination of them, and the weft of which is made wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, valued at not ex- ceeding twenty cents per square yard, five cents per square yard, and in addition thereto thirty-five per centum ad valorem ; valued at above twenty cents per square yard, seven cents per square yard, and in addition thereto forty per centum ad valorem. Provided , That on all goods weighing four ounces and over per square yard the duty shall be the same as is imposed on woolen shawls, woolen cloths, etc., provided for in this act. Women’s and children’s dress-goods, and coat-linings, not specially enumerated or provided for in this act, the warp or weft of which is made wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, or of a mixture of them, and on all goods of like description, twelve cents per square yard and forty per centum ad valorem. Provided , That all such goods weighing over five ounces per square yard shall pay a duty of thirty-five cents per pound and forty per centum ad valorem. Clothing, ready-made, and wearing apparel of every description, and balmoral skirts and skirting, and goods of similar description, or used for like purposes, composed wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, made up or manu- factured wholly or in part by the tailor, seamstress, or manufacturer, except knit goods, thirty cents per pound, and in addition thereto thirty -five per centum ad valorem. Webbings, gorings,beltings,bindings,braids, galloons, fringes, gimps, cords, cords and tassels, dress-trimmings, head-nets, buttons, or barrel buttons, or buttons of other forms, for tassels or ornaments, wrought by hand or braided by machinery, made of wool, worsted, the hair of the alpaca, goat, or other animals, or of which wool, worsted, the hair of the alpaca, goat, or other animals, is a com- ponent material, thirty cents per pound, and in addition thereto fifty per centum ad valorem. Aubusson, Axminster, and chenille carpets, and carpets woven whole for rooms, forty-five cents per square yard, and in addition thereto thirty-five per centum ad valorem. Saxony, Wilton, and Tournay velvet carpets, wrought by the Jac- quard machine, forty-five cents per square yard, and in addition thereto thirty-five per centum ad valorem. Brussels carpets, wrought by the Jacquard machine, thirty cents per square yard, and in addition thereto thirty-five per centum ad valorem. Patent velvet and tapestry velvet carpets, printed on the warp or otherwise, twenty -five cents per square yard, and in addition thereto thirty-five per centum ad valorem. Tapestry Brussels carpets, printed on the warp or otherwise, twenty cents per square yard, and in addition thereto thirty-five per cen- tum ad valorem. Treble ingrain, three-ply, and worsted chain Venetian carpets, twelve cents per square yard, and in addition thereto thirty five per centum ad valorem. Yarn Venetian, and two-pty ingrain carpets, eight cents per square yard, and in addition thereto thirty-five per centum ad valorem. Druggets and bookings, printed, colored, or otherwise, fifteen cents per square yard, and in addition thereto thirty- five per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 69 Hemp or jute carpeting, six cents per square yard. Carpets and carpentings of wool, flax, or cotton, or parts of either or other material, not otherwise herein specified, forty per centum ad valorem ; and mats, rugs, screens, covers, hassocks, bedsides, and other portions of carpets or carpetings shall be subjected to the rate of duty herein imposed on carpets or carpeting of like character or description; and the duty on all other mats, not exclusively of vegetable material, screens, hassocks, and rugs, shall be forty-five per centum ad valorem. Schedule L. — Silk and silk goods. Silk, particularly manufactured from cocoons, or waste silk, and not further advanced or manufactured than carded or combed silk, fifty cents per pound. Thrown silk, in gum, not more advanced than singles, tram, organ- zine, sewing silk, twist, floss, in the gum, and spun silk, one dollar and fifty cents per pound. Silk threads or yarns, of every discription, purified or dried, two dol- lars and fifty cents per pound. All goods, wares, and merchandise, hot specially enumerated or pro- vided for in this act, made of silk, or of which silk is the com- ponent material of chief value, fifty per centum ad valorem. Schedule M. — Books, papers, etc. Books, periodicals, pamphlets, bound or unbound, and all printed matter not specially enumerated or provided for in this act, en- gravings, bound or unbound, etchings, illustrated books, maps, and charts, fifteen per centum ad valorem. Blank books, bound or unbound, and blank books for press copying, twenty per centum ad valorem. Paper, sized or glued, suitable only for printing paper, twenty per centum ad valorem. Printing paper, unsized, used for books and newspapers exclusively, fifteen per centum ad valorem. Paper, manufactures of, or of which paper is a component material, not specially enumerated or provided for in this act, fifteen per centum ad valorem. Sheathing paper, ten per centum ad valorem. Paper boxes, and all other fancy boxes, thirty-five per centum ad valorem. Paper envelopes, twenty-five per centum ad valorem. Paper-hangings and paper for screens or fire-boards, paper, antiqua- rian, demy, drawing, elephant, foolscap, imperial, letter, note, and all other paper not specially enumerated or provided for in this act, twenty-five per centum ad valorem. Schedule N. — Sundries. Alabaster and spar statuary and ornaments, ten per centum ad va- lorem. Baskets and all other articles composed of grass, osier, palm leaf, whalebone, or willow, or straw, not specially enumerated or pro- vided for in this act, thirty per centum ad valorem. 70 REPORT OF THE TARIFF COMMISSION. Beads, and bead ornaments of all Kinds, except amber, fifty per centum ad valorem. Blacking of all kinds, twenty -five per centum ad valorem. Bladders, manufactures of, twenty-five per centum ad valorem. Bone, horn, ivory, or vegetable ivory, all manufactures of, not spe- cially enumerated or provided for in this act, thirty per centum ad valorem. Bonnets, hats, and hoods for men, women, and children, composed of chip, grass, palm-leaf, willow, or straw, or any other vegetable substance, hair, whalebone, or other material, not specially enu- merated or provided for in this act, thirty per centum ad valorem. Bouillons, or cannetille, metal threads, file, or gespinst, twenty-five per centum ad valorem. Bristles, fifteen cents per pound. Brooms of all kinds, twenty-five per centum ad valorem. Brushes of all kinds, thirty per centum ad valorem. Bulbs and bulbous roots, not medicinal, and not specially enumer- ated or provided for in this act, twenty per centum ad valorem. Burr-stones, manufactured or bound up into mill-stones, twenty per centum ad valorem. Buttons and button-molds, not specially enumerated or provided for in this act, twenty-five per centum ad valorem. Candles and tapers of all kinds, thirty-five per centum ad valorem. Canes and sticks for walking, finished, thirty-five per centum ad valorem $ if unfinished, twenty per centum ad valorem. Card-cases, pocket-books, shell boxes, souvenirs, and all similar ar- ticles, of whatever material composed, and by whatever name known, not specially enumerated or provided for in this act, thirty- five per centum ad valorem. Carriages and parts of, not specially enumerated or provided for in this act, thirty -five per centum ad valorem. Chronometers, box or ship’s, and parts thereof, ten per centum ad valorem. Clocks, and parts of clocks, thirty per centum ad valorem. Coach and harness furniture of all kinds, saddlery, coach and harness hardware, silver-plated, brass, brass-plated, or covered, common, tinned, burnished, or japanned, not specially enumerated or pro- vided for in this act, fifty per centum ad valorem. Coal slack or culm, such as will pass through a half-inch screen, thirty cents per ton of twenty-eight bushels, eighty pounds to the bushel. Coal, bituminous, and shale, fifty cents per ton of twenty-eight bush- els, eighty pounds to the bushel. Coke, twenty per centum ad valorem. Combs of all kinds, thirty per centum ad valorem. Comfits, sweetmeats, or fruits preserved in sugar, brandy, or molasses, not specially enumerated or provided for in this act, thirty per centum ad valorem. Compositions of glass or paste, when not set, ten per centum ad va- lorem. Coral, cut, manufactured, or set, twenty-five per centum ad valorem. Corks and cork bark, manufactured, twenty-five per centum ad va- lorem. Crayons of all kinds, twenty per centum ad valorem. Dice, draughts, chess men, chess balls, and billiard and bagatelle balls, of ivory or bone, fifty per centum ad valorem. Dolls and toys, fifty per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 71 Emery ore, five dollars per ton. Emery grains and emery manufactured, ground, pulverized, or re- fined, one cent per pound. Epaulets, galloons, laces, knots, stars, tassels, and wings, of gold, sil- ver, or other metal, thirty-five per centum ad valorem. Fans of all kinds, except common palm-leaf fans, of whatever mate- rial composed, thirty-five per centum ad valorem. Feathers of all kinds, crude or not dressed, colored or manufactured, twenty-five per centum ad valorem; when dressed, colored, or manu- factured, including dressed and finished birds, for millinery orna- ments, and artificial and ornamental feathers and flowers, or parts thereof, of whatever material composed, for millinery use, not spe- cially enumerated or provided for in this act, fifty per ceutum ad valorem. « Finishing powder, twenty per centum ad valorem. Fire crackers of all kinds, one hundred per centum ad valorem. Floor matting and floor mats, exclusively of vegetable substances, twenty per centum ad valorem. Fulminates, fulminating powders, and all like articles, not specially enumerated or provided for in this act, thirty per centum ad va- lorem. Fur, articles made of, and not specially enumerated or provided for in this act, thirty per centum ad valorem. Gloves, kid or leather, of all descriptions, fifty per centum ad va- lorem. Grease, all not specially enumerated or provided for in this act, ten per centum ad valorem. Grind-stones, rough or unfinished, ten per centum ad valorem ; fin- ished, twenty per centum ad valorem. Gun])owder, and all explosive substances used for mining, blasting, artillery, or sporting purposes, and all fire-works, or parts thereof, not specially enumerated or provided for in this act, thirty per centum ad valorem. Gun-wads, of all descriptions, thirty-five per centum ad valorem. Gutta-percha, manufactured, and all articles of, not specially enume- rated or provided for in this act, thirtv-five per centum ad valorem. H air, human, bracelets, braids, chains, rings, curls, and ringlets, com- posed of hair, or of which hair is the component material of chief value, thirty-five per centum ad valorem. Curled hair, except of hogs, used for beds or mattresses, twenty-five per centum ad valorem. Human hair, raw, uncleaned and not drawn, twenty per centum ad valorem. If clean or drawn, but not manufactured, thirty per centum ad valorem. When manufactured, thirty-five per centum ad valorem. Horse-liair, and hair of all kinds, cleaned or uncleaned, but unman- ufactured, and not specially enumerated or provided for in this act, ten per centum ad valorem. Hair cloth, known as u crinoline cloth,” and all other manufactures of hair not specially enumerated or provided for in this act, thirty per centum ad valorem. Hair cloth, known as “hair seating,” eighteen inches wide or over, thirty cents per square yard ; less than eighteen inches wide, twenty- five cents per square yard. Hair pencils, thirty j)er ceutum ad valorem. 72 REPORT OF THE TARIFF COMMISSION. Hats, &c., materials for. Braids, plaits, flats, laces, trimmings, tis- sues, willow sheets and squares, used for making or ornamenting hats, bonnets, and hoods, composed of straw, chip, grass, palm leaf, willow, hair, whalebone or any (ftlier substance or material, not spe- cially enumerated or provided for in this act, thirty-five per centum ad valorem. Hatters’ furs, not on the skin, and dressed furs on the skin, twenty per centum ad valorem. Hemp seed and rapeseed, and other oil seeds of like character, other than linseed or flaxseed, one quarter of one cent per pound. India-rubber, manufactures of, except manufactures of India-rubber and silk, and manufactures of India-rubber and wool, and articles composed wholly of India-rubber, and not specially enumerated or provided for in this act, twenty -five per centum ad valorem. Inks of all kinds and ink powders, thirty per centum ad valorem. Japanned ware of all kinds, not specially enumerated or provided for in this act, forty per centum ad valorem. Jet, manufactures and imitations of, twenty-five per centum ad va- lorem. Jewelry of all kinds, twenty-five per centum ad valorem. Leather, bend or belting leather, and Spanish or other sole leather, fifteen per centum ad valorem. Calfskins, tanned or untanned, and dressed upper leather of all other kinds, and skins dressed and finished of all kinds not specially enu- merated or provided for in this act, and skins of morocco, finished, twenty per centum ad valorem. Skins for morocco, tanned, but unfinished, ten per centum ad valorem. All manufactures and articles of leather, or of which leather shall be a component part, not specially enumerated or provided for in this* act, thirty per centum ad valorem. Lime, ten per centum ad valorem. Linseed or flaxseed, twenty cents per bushel of fifty-six pounds; but no drawback shall be allowed on oil-cake made from imported seed. Marble of all kinds, in block, rough or squared ; veined marble, sawed, dressed, or otherwise, including marble slabs and marble paving tiles, seventy-five cents per cubic foot. All manufactures of marble not specially enumerated or provided for in this act, fifty per centum ad valorem. Musical instruments of all kinds, twenty five per centum ad valorem. Osier, or willow, prepared for basket-makers’ use, twenty-five per centum ad valorem. Papier-mache, manufactures, articles, and wares of, thirty per centum ad valorem. Pencils of wood, filled with lead or other material (except slate), and pencils of lead, and pencil leads not in wood, thirty-five per centum ad valorem. Percussion caps, forty per centum ad valorem. Philosophical apparatus and instruments, forty per centum ad valo- rem : Provided, that any philosopliical apparatus and instruments imported for the use of any society incorporated for religious pur- poses shall be subject to a duty of only fifteen per centum ad valorem. Pipes, pipe bowls, and all smokers’ articles whatsoever, not specially enumerated or provided for in this act, one hundred per centum ad valorem ; all common pipes of clay not glazed, colored, painted, or tipped, thirty-five per centum ad valorem. REPORT OF THE TARIFF COMMISSION. 73 Plants, trees, shrubs, and vines of all kinds not otherwise provided for, and seeds of all kinds, except medicinal seeds, or seeds not specially enumerated or provided for in this act, twenty per centum ad valorem. Plaster of Paris, when ground or calcined, twenty per centum ad valorem. Playing cards, one hundred per centum ad valorem. Polishing powders of every description, by whatever name known, including Frankfort black, and Berlin, Chinese, fig and wash blue, twenty per centum ad valorem. Precious stones of all kinds, ten per centum ad valorem. Bags, of whatever material composed, and not specially enumerated or provided for in this act, ten per Centum ad valorem. Rattans, and reeds manufactured, but not made up into completed articles, ten per centum ad valorem. Salt, in bags, sacks, barrels, or other packages, ten cents per onehun- dred pounds ; in bulk, six cents per one hundred pounds. Scagliola, and composition tops for tables, or other articles of furni- ture, thirty- five per centum ad valorem. Sealing-wax, twenty per centum ad valorem. Shells, whole or parts of, manufactured, of every description, not spe- cially enumerated or provided for in this act, twenty-five per centum ad valorem. Stones, unmanufactured, or undressed, freestone, granite, sandstone, and all building or monumental stone, except marble, not specially enumerated or provided for in this act, fifteen per centum ad valorem. Strings : all strings of catgut, or any other like material, other than strings for musical instruments, twenty-five per centum ad valorem. Tallow, one cent per pound. Teeth, manufactured, twenty-five tier centum ad valorem. Umbrella and parasol ribs and stretcher, frames, tips, runners, handles, or other parts thereof, when made in whole or chief part of iron, steel, or any other metal, forty per centum ad valorem ; umbrellas, parasols, and shades, when covered with silk or alpaca, fifty per centum ad valorem ; all other umbrellas, forty per centum ad valorem. Umbrellas, parasols, and sunshades, frames and sticks for, finished or unfinished, not specially enumerated or provided for in this act, thirty per centum ad valorem. Waste, all not specially enumerated or provided for in this act, ten per centum ad valorem. Watches, watch-cases, watch- movements, parts of watches, and watch materials, not specially enumerated or provided for in this act, twenty-five per centum ad valorem. Webbing, composed of cotton, fiax, or any other materials not spe- cially enumerated or provided for in this act, thirty-five per centum ad valorem. The Free List. Section 2505. The importation of the following articles shall be exempt from duty : CHEMICALS. Albumen, any form or condition ; lactariue. Aconite, not leaf or bark. Ambergris. 74 REPORT OF THE TARIFF COMMISSION. Annatto, roncou, rocou, or Orleans, and all extracts of. Balm of Gilead. Blood, dried. Bones, crude, not manufactured, burned, calcined, ground, or steamed. Bone-dust and bone-ash for manufacture of phosphates and fertil- izers. Carbon, animal, fit for fertilizing only. Guano and other mineral manures. Manures, unmanufactured and substances, expressly for manure. Musk, crude, in natural pod. Oivit crude. Cochineal. Dyeing or tanning; articles fin a crude state used in dyeing or tan- ning, not specially enumerated or provided for in this act. Fish skins. Hide-cuttings, raw, with or without hair, and all glue stock. Hoofs. Horns, and parts of horns, unmanufactured. Ipecac. Isingglass or fish glue. Leather, old scraps. Leeches. Bennets, raw or prepared. Argal, or Argol, or crude tartar. Asafcetida. Barks, Cinchona, or other barks used in the manufacture of quinia. Brazil paste. Camphor, crude. Cassia, Cassia buds, Cassia Yera, unground. Charcoal. Cinuamon, and chips of, unground. Cloves and clove stems, unground. Cocculus indicus. Cudbear. Curry and curry powder. Cutcb. Divi Divi. Dragon’s blood. Ergot. Gam bier. Ginger root, unground. Indigo and artificial indigo. Iodine, crude. Jalap. Kelp. Lac dye, crude, seed, button, stick, and shell. Lac spirits. Lemon juice and lime juice. Liquorice root, un ground. Litmus, prepared or not prepared. Logwood extracts, and decoctions of extracts, and decoctions of fus- tic and redwood, and extracts of and decoctions of all other dye woods. Mace. Madder, and munjeet or Indian madder, ground or prepared, and extracts of. REPORT OF THE TARIFF COMMISSION. 75 Manna. Myrobolan. Orchil, or orchil liquid. Nutmegs. Nux vomica. Ottar of roses. Salacine. Oils: Almond. Amber, crude and rectified. Ambergris. Anise, or anise seed. Aniline, crude. Aspic, or spike lavender. Bergamot. Cajeput. Carraway. Cassia and cinnamon. Cedrat. Chamomile. Citronella, or lemon grass. Civet. Fennel. Jasmine, or jasamine. Juglandium. Juniper. Lavender. Lemon. Limes. Mace. Neroli, or orange flower. Orange. Palm and cocoanut. Pepper, unground, of all kinds. Pimento, unground. Poppy. Rosemary or anthoss. Sesame or sesame-seed or bene. Thyme or origanum, red or white valerian. Saffron and safflower, and extract of and saffron cake. Selep, or saloup. Storax or styrax. Turmeric. Turpentine, Venice. Yalonia. Vegetable and mineral wax. Wood ashes and lye of, and beet root ashes. Acids used for medicinal, chemical, or manufacturing specially enumerated or provided for in this act. Alizarine, natural or artificial. Agates, unmanufactured. Apatite. Asbestos, unmanufactured. Arsenic. Antimony ore, crude sulphide of. Arsenic, sulphide of, or orpiment. purposes, not 76 REPORT OF THE TARIFF COMMISSION. Arseniate of aniline. Baryta, carbonate or withe rite. Bauxite. Black salts and black tares. Bromine. Cadmium. Calamine. Cerium. Cobalt, as metallic arsenic. Colcotliar, dry, or oxide of iron. Chalk and cliff stone, unmanufactured. Feldspar. Cryolite or kryolith. Iridum. Kieserite. Kyanite or cyanite, and kaiuite. Lime, borate of. Lime, citrate of. Lime, chloride of, or bleaching powder. Magnesium. Magnesite, or native mineral carbonate of magnesia. Manganese, oxide and ore of. Mineral waters, natural. Osmium. Oxidizing paste. Palladium. Paraffine. Phosphate, crude or native, for fertilizing purposes. Potash, muriate of. Plaster of Paris or sulphate of lime, unground. Quinia, sulphate of, salts of, and cinchonidia. Soda, nitrate of or cubic nitrate. Strontia^-oxide of ; and proto-oxide of strontian, and strontianite, or mineral carbonate of strontia. Sulphur, or brimstone Sulphur lac or precipitated. Tripoli. Tincal, or crude borax. Uranium, oxide of, verdigris or subacetate of copper. Drugs, barks, beans, berries, balsams, buds, bulbs, and bulbous roots and excrescences, such as nutgalls, fruits, flowers, dried, fibres ; grains, gums and gum-resins ; herbs, leaves, lichens, mosses, nuts, roots, and stems, spices, vegetables, seeds aromatic, not garden seeds, and seeds of morbid growth ; weeds, woods used expressly for dying, and dried insects — any of the foregoing, of which are not edible and are in a crude state, and not advanced in value or condition by refining, or grinding, or by other process of manufac- ture, and not specially enumerated or provided for in this act. Vaccine virus. Crude minerals, not advanced in value or condition by refining or grinding, or by other process of manufacture, not specially enumer- ated or provided for in this act. SUNDRIES. Aluminium. Amber beads and gum. REPORT OF THE TARIFF COMMISSION. 77 American manufactures of casks, barrels, or carboys, and other ves- sels, and grain bags, the manufacture of the United States, if ex- ported containing American produce, and declaration be made of intent to return the same empty, under such regulations as shall be prescribed by the Secretary of the Treasury. Animals, brought into the United States, temporarily, and for a period not exceeding six mouths, for the purpose of exhibition or competi- tion for prizes offered by any agricultural or racing association ; but a bond shall be first given in accordance with the regulations. Animals, alive, specially imported for breeding purposes, shall be ad- mitted free upon proof thereof satisfactory to the Secretary of the Treasury, and under such regulations as he may prescribe, and teams of animals, including their harness and tackle, actually owned by persons emigrating to the United States with their families from foreign countries, and in actual use for the purpose of such emigra- tion, shall also be admitted free of duty, under such regulations as the Secretary of the Treasury may prescribe. Arrowroot. Articles, the growth, produce and manufacture of the United States, when returned in the same condition as exported ; but proof of the identity of such articles shall be made under regulations to be prescribed by the Secretary of the Treasury, and if such articles were subject to internal tax at the time of exportation such tax shall be proved to have been paid before exportation, and not re- funded. Articles imported for the use of the United States, provided that the price of the same did not include the duty. Bamboo reeds, no further manufactured than cut into suitable lengths for walking sticks or canes, or for sticks for umbrellas, parasols, or sunshades. Bamboo, unmanufactured. Barley, pearled, patent, or hulled. Barrels of American manufacture, exported filled with domestic pe- troleum, and returned empty, under such regulations as the Sec- retary of the Treasury may prescribe, and without requiring the filing of a declaration at time of export of intent to return the same empty. Barrels and grain bags, the manufacture of the United States, when exported filled with American products, or exported empty and re- turned filled with foreign products, may be returned to the United States free of duty, under such rules and regulations as shall be prescribed by the Secretary of the Treasury; and the provisions of this section shall apply to and include sliooks when returned as barrels or boxes as aforesaid. Bed-feathers and downs, and feather-beds. Bells, broken, and bell metal broken and fit only to be remanufact- ured. Bells, old, and bell metal. Birds, stuffed. Birds,, singing and other, and land and water fowls. Bismuth. Bladders, crude, and all integuments of animals not specially enumer- ated or provided for in this act. Bologna sausages. Bolting-cloths. 78 REPORT OF THE TARIFF COMMISSION. Books which shall have been printed and manufactured more than ten years at the date of importation. Books, maps, and chartsimported by authority 6r for use of the United States or for the use of the Library of Congress ; but the duty shall not have been included in the contract or price paid. Books, maps, and charts specially imported, not more than two copies in any one invoice, in good faith, for the use of any society incor- porated or established for philosophical, literary, or religious pur- poses, or for the encouragement of the tine arts, or for the use, or by order, of any college, academy, school, or seminary of learning in the United States. Books, professional, of persons arriving in the United States. Books, household effects, or libraries, or parts of libraries, in use, of persons or families from foreign countries, if used abroad by them not less than one year, and not intended for any other person or persons, nor for sale. Books, by foreign authors, not published in the United States, in sin- gle copies for use, and not for sale. Breccia, in blocks or slabs. Brine. Brazil pebbles for spectacles, and pebbles for spectacles, rough. Bullion, gold and silver. Burgundy pitch. Burr stone, in blocks, rough or unmanufactured, and not bound up in mill-stones. Cabinets of coins, medals, and all other collections of antiquities. Castor or castoreum. Catgut strings, or gut-cord, for musical instruments. Catgut or whip-gut, unmanufactured. Coal, anthracite. Coal, stores of American vessels, but none shall be unloaded. Cobalt, ore of. Cocoa, or cacao, crude, and fiber, leaves, and shells of. Coffee. Coins, gold, silver, and copper. (3oir and coir yarn. Collections of antiquity, specially imported and not for sale. Copper, old, taken from the bottom of American vessels, compelled by marine disaster to repair in foreign ports. Copper, when imported for the United States Mint. Coral, marine, unmanufactured. Cork- wood, or cork-bark, unmanufactured. Cotton. Curling- stones, or quoits. Cuttle-fish bone. Diamonds, rough or uncut, including glaziers’ diamonds. Diamond dust or bort. Dyeing or tanning articles, in a crude state, used in dyeing or tanning,, not specially enumerated or provided for in this act. Eggs. Esparto or Spanish grass, and other grasses, and pulp of, for the man- ufacture of paper. Fans, common palm-leaf. Farina. Fashion plates, engraved on steel or on wood, colored or plain. Felt, adhesive, for sheathing vessels. REPORT OF THE TARIFF COMMISSION. 7 $ Fabrin, in all forms. Fire- wood. Fish, fresh, for immediate consumption. Fish for bait. Flint, flints and ground flint-stones. Fossils. Fruit-plants, tropical and semi-tropical, for the purpose of propagation or cultivation. Fruits, green, ripe, or dried, not specially enumerated or provided for in this act. Furs, undressed. Fur skins of all kinds, not dressed in any manner. Glass, broken pieces, and old glass which cannot be cut for use, and fit only to be remanufactured. Glass plate, or disks, un wrought, for use in the manufactureof optical instruments. Goat skins, raw. Gold beaters’ molds, and gold beaters’ skins. Gold size. Grease, for use as soap-stock only, not specially enumerated or pro- vided for. Gunny bags, and gunny cloth, old or refuse, fit only for remanufact- uring. Gut, and worm gut, manufactured or unmanufactured, for whip and other cord. Guts, salted. Gutta-percha, crude. Hair, horse or cattle, cleaned or uncleaned, drawn or undrawn, but unmanufactured, not specially enumerated or provided for in this act ; of hogs, curled for beds and mattresses, and not fit for bristles. Hide rope. Hides, raw or uncured, whether dry, salted, or pickled, and skins, except sheep-skins with the wool on, Angora goat-skins, raw, with- out the wool, unmanufactured, asses’ skins, raw or unmanufactured. Hones and whetstones. Hop-roots for cultivation. Ice. India-rubber, crude, and milk of. India malacca joints, not further manufactured than cut into suit- able lengths for the manufactures into which they are intended to be converted. Ivory, and vegetable ivory, unmanufactured. Jet, unmanufactured. Joss-stick, or. joss-light. Junk, old. Lava, unmanufactured. Life-boats and life-saving apparatus, specially imported by societies incorporated or established to encourage the saving of human life. Lithographic stones, not engraved. Loadstones. Logs and round unmanufactured timber, not specially enumerated or provided for in this act, and ship-timber. Maccaroni and vermicelli. Magnets. Manuscripts. Marrow, crude. so REPORT OF THE TARIFF COMMISSION. Marsh-mallows* Medals of gold, silver, or copper. Meerschaum, crude or raw. Mica and mica waste. Models of inventions and other improvements in the arts ; but no article or articles shall be deemed a model or improvements which caii be fitted for use. Moss, sea- weeds, and all other vegetable substances used for beds and mattresses. Newspapers and periodicals. Nuts, cocoa, and Brazil or cream. Oakum. Oil-cake. Oil, spermaceti, whale, aud other fish of American fisheries, and all other articles the produce of such fisheries. Olives, green or prepared. Orange and lemon peel, not preserved, candied, or otherwise prepared. Ores, of gold and silver. Palm nuts and palm -nut kernels. Paper stock, crude, of every description, including all grasses, fibers, rags of all kinds, other than wool, waste, shavings, clippings, old paper, rope-ends, waste rope, waste bagging, guuny-bags, gunny- eloth, old or refuse, to be used in making, and fit only to be con- verted into paper, and unfit for any other manufacture, and cotton waste, whether for paper-stock or other purposes. Parchment. Pearl, mother of. Personal and household effects, not merchandise, of citizens of the United States dying abroad. Pewter and britannia metal, old, and fit only to be remanufactured. Philosophical and scientific apparatus, instruments, and preparations, statuary, casts of marble, bronze, alabaster, or plaster of Paris, paintings, drawings, and etchings, specially imported in good faith for the use of any society or institution incorporated or estab- lished for philosophical, educational, scientific, or literary purposes, or encouragement of the fine arts, and not intended for sale. Plants, trees, shrubs, roots, seed-cane, and seeds imported by the Department of Agriculture, or the United States Botanical Garden. Platiua, unmanufactured. Platinum, unmanufactured, and vases, retorts, and other apparatus, vessels, and parts thereof, for chemical uses. Plumbago. Polishing stones. Pulp, dried for paper- makers’ use. Pulu. Pumice and pumice stone. Quills, prepared or unprepared. Railroad ties, of wood. Rattans and reeds, unmanufactured. Regalia and gems, statues, statuary, and specimens of sculpture where specially imported in good faith for the use of any society incorpo- rated or established for philosophical, literary, or religious pur- poses, or for the encouragement of the fine arts, or for the use, or by order of, any college, academy, school, or seminary of learning in the United States. Root flour. , REPORT OF THE TARIFF COMMISSION. 81 Rotten-stone. Sago, sago crude, and sago flour. Saurkraut. Sausage skins. Sea-weed, not otherwise provided for. Seed of the sugar-beet. Shark skins. Shells of every description, not manufactured. Shingle-bolts, not stave-bolts, provided that heading-bolts shall be held and construed to be included under the term stave-bolts. Ship planking,’ and handle bolts. Shrimps, or other shell -fish. Silk, raw, or as reeled from the cocoon, but not doubled, twisted, or advanced in manufacture in any way. Silk cocoons and silk waste. Silk-worms 7 eggs. Skeletons, and other preparations of anatomy. Skins, dried, salted, or pickled. Snails. Soap stocks. Sodium. Sparterre, for making or ornamenting hats. Specimens of natural history, botany, and mineralogy, when imported for cabinets, or as objects of taste or science, and not for sale. Spunk. o Spurs and stilts, used in the manufacture of earthen, stone, or crock- ery ware. Straw, unmanufactured. Sugar of milk. Sweepings of silver and gold. Tamarinds. Tabeoca, cassava, or cassada. Tea. Tea-plants. Teasels. Teeth, unmanufactured. Terra alba, alluminous. Terra japonica. Tin ore, bars, blocks, or pigs, grain or granulated. Tonquin, Tonqua or Tonka beans. Tortoise and other shells, unmanufactured. Turtles. Types, old, and fit only to be remanufactured. Umbrella sticks, crude, to wit, all partridge hair-wood, pimento, orange, myrtle, and all other sticks and canes in the rough, or no further manufactured than cut into lengths suitable for umbrella, parasol, or sunshade sticks or walking-canes. Vellum. Wafers, un medicated. Wearing apparel, in actual use, and other personal effects (not mer- chandise), professional books, implements, instruments, and tools of trade occupation or employment of persons arriving in the United States. But this exemption shall not be construed to in- clude machinery, or other articles imported for use in any manu- facturing establishment, or for sale. Whalebone, unmanufactured. H. Mis. 0 G 82 REPORT OF THE TARIFF COMMISSION. Woods, poplar, or other woods, for the manufacture of paper. Woods, namely, cedar, lignum-vitse, lancewood, ebony, box, grana- dilla, mahogany, rosewood, satinwood, and all cabinet woods, un- manfactured. Works of art, painting, statuary, fountains, and other works of art, the production of American artists. But the fact of such pro- duction must be verified by the certificate of a consul or minister of the United States indorsed upon the written declaration of the artist; paintings, statuary, fountains, and other works of art, im- ported expressly for presentation to the national institutions, or to any State, or to any municipal corporation. Yams, Yeast cakes. Zafter. PROPOSED AMENDMENTS TO STATUTES. Section 2499. There shall be levied, collected, and paid on each and every non -enumerated article which bears a similitude, either in ma- terial, quality, texture, or the use to which it may be applied, to any article enumerated in this title as chargeable with duty, the same rate of duty which is levied and charged on the enumerated article which it most resembles in any of the particulars before mentioned ; and if any non- enumerated article equally resembles two or more enumerated articles on which different rates are chargeable, there shall be levied, collected, and paid on such noil-enumerated article the same rate of duty as is chargeable on the article which it resembles jfhying the highest duty ; and on all articles manufactured from two or more materials the duty shall be assessed at the highest rates at which any of its component parts may be chargeable. Provided , That non-enumerated articles similar in material and quality and texture, and the use to which they may be applied, to articles on the free list, and in the manufacture of which no dutiable materials are used, shall be free. Section 2626. At ports to which there are appointed a collector, na- val officer, and surveyor, it shall be the duty of the naval officer :- First. To receive copies of all manifests and entries, and to verify the final adjustment or liquidation of duties made by the collector. Second. To keep a separate record of such estimates. Third. To countersign all debenture certificates to be granted by the collector. Fourth. To examine the collector’s abstracts of duties, and other ac- counts of receipts, bonds, and expenditures, and certify the same, if found right. Section 2627. At ports to which there are appointed a collector, naval officer, and surveyor it sFall be the duty of the surveyor, who shall be in all cases subject to the direction of the collector: First. To superintend and direct all inspectors, weighers, measurers, and gaugers within his port. Second. To report once in every week to the collector the name or names of all inspectors, weighers, gaugers, or measurers who are ab- sent from or neglect to do their duty. Third. To visit or inspect the vessels which arrive in his port, and make a return in writing every morning to the collector of all vessels which have arrived from foreign ports during the preceding day; speci- fying the names and denominations of the vessels, the masters’ names, from whence arrived, whether laden or in ballast, to what nation belong- ing, and whether the masters thereof have or have not complied with REPORT OF THE TARIFF COMMISSION. 83 the law iii having the required number of manifests of the cargo on board, agreeing in substance with the provisions of law. Fourth. To put on board each of such vessels one or more inspectors immediately after their arrival in port. Fifth. To ascertain the quantities and kinds of distilled spirits im- ported, rating such spirits according to their respective degrees of proof, to be ascertained and reported to him by the appraiser, and as defined by the laws imposing duties on spirits. Sixth. To examine whether the goods imported in any vessel, and the deliveries thereof agreeably to the inspector’s returns, correspond with the permits tor landing the same, and if any error or disagree- ment appears, to report the same to the collector and to the naval offi- cer, if any. Seventh. To superintend the lading for exportation of all goods en- tered for the benefit of any drawback, bounty, or allowance, and exam- ine and report whether the kind, quantity, and quality of the goods so laden on board any vessel for exportation correspond with the entries and permits granted therefor. Eighth. To examine, and from time to time, and particularly on the first Monday of January and July in each year, try the weights, meas- ures, and other instruments used in ascertaining the duties on imports, with standards to be provided by each collector at the public expense for that purpose, and where disagreements or errors are discovered, to report the same to the collector, and to obey and execute such direc- tions as he may receive for correcting the same, agreeably to the stand- ards. Section 2(348. Collectors and surveyors of the collection districts on the northern, northeastern, and northwestern frontiers, are authorized to keep, at their several offices, blank manifests and clearances required for the business of their districts, and to furnish the samefreeof charge to persons desiring to make entries ; said blanks to be furnished at the public expense. Section 2654. There shall be allowed and paid for the use of the collector the following fees : First. For every entrance of any vessel of one hundred tons burden and upward, two dollars and a half. Second. For every clearance of any vessel of one hundred tons bur- den and upward, two dollars and a half. Third. For every entrance of any vessel under the burden of one hundred tons, one dollar and a half. Fourth. For every clearance of any vessel under one hundred tons burden, one dollar and a half. Fifth. For every port entry, two dollars. Sixth. For every entry of merchandise, at any custom-house in the United States, except entries under section twenty-seven hundred and ninety-nine (2799), fifty cents. That section twenty-six hundred and fifty-eight (2658) of the Revised Statutes be and the same is hereby repealed. Section 2770. It shall not be lawful to make entry of any vessel which shall arrive within the United States from any foreign port, or of the cargo on board such vessel, elsewhere than at one of the ports of entry designated in chapter one of this title, nor to unlade the cargo, or any part thereof, elsewhere than at one of the ports of delivery therein designated, except that in cases of cargoes in bulk the collector may, by special permit, allow the same to be unladed at any point in his collection district, to be designated, under the supervision of an in- 84 REPORT OF THE TARIFF COMMISSION. spector of customs, on payment by the importer of the necessary ex- penses of such inspector. Provided , That every port of entry shall be also a port of delivery. This section shall not prevent the master or commander of any vessel from making entry with the collector of any district in which such vessel may be owned, or from which she may have sailed on the voyage from which she shall then have returned. Section 2785. The owner or consignee of any merchandise on board of auy such vessel, or in case of his absence or sickness, his known agent or factor, in his name, shall, within fifteen daj^s after the report of the master to the collector of the district for which such merchan- dise shall be destined, make entry thereof, in writing, with the collec- tor, and shall in such entry specify the name of the vessel and of her master, in which, and the port or place from which such merchandise was imported, the particular marks, numbers, denominations, in ac- cordance with the provisions of section two thousand eight hundred and seventy (2870), and agreeably to the bills of lading and prime cost, including charges of each particular package or parcel whereof the entry shall consist, or, if in bulk, the quantity, quality, and prime cost, including charges thereof, particularly specifying the species of money in which the invoices thereof are made out. Such entry shall be subscribed by the person making it, if the owner or consignee, in his own name, or if another person, in his name as agent or factor, for the owner or consignee. The person making such entry shall also pro- duce to the collector the original invoices of the merchandise, or other documents received in lieu thereof or concerning the same, in the same state in which they were received, with the bills of lading for the same, which invoices shall be signed by the persons in the office of the col- lector who have compared and examined them. Section 2789. Whenever an entry of merchandise is imperfect for want of invoices or bills of lading, or because the merchandise is im- perfectly described therein, or for any other cause, the collector shall take the merchandise into his custody until the quantity, quality, or value thereof, as the case may require, can be ascertained. Section 2795. In order to ascertain what articles ought to be ex- empt from duty as the sea-stores of a vessel, the master shall particu- larly specify the articles in the report or manifest to be by him made, designating them as sea-stores of such vessel ; and in the oath to be taken by such master, on making such report, he shall declare that the articles so specified as sea-stores were truly taken on board as such, and were not intended by way of merchandise or for sale ; whereupon the articles may remain on board free of duty. Provided , That the master may, after taking said oath, sell any part of said sea-stores, not exceeding one hundred dollars in value, in good faith taken on board as such, on entering the same and paying the duties thereon. Section 2799. In order to ascertain what articles ought to be ex- empted as the wearing apparel, personal and household effects, libraries, and parts of libraries in use, professional books, implements, instru- ments, and tools of trade, occupation, or employment, and other personal baggage of persons who arrive in the United States, due entry or decla- ration thereof as of merchandise, but separate and distinct from that of any other merchandise imported from a foreign port, shall be made with the collector of the district in which the articles are intended to be landed, by the owner thereof, or his agent, specifying the persons by whom or for whom such entry is made, and particularizing the several packages and their contents, with their marks and numbers; and the person who shall make the entry or declaration shall take and subscribe REPORT OP THE TARIFF COMMISSION. 85 an oatk before the collector, declaring that the entry subscribed by him, and to which the oath is annexed, contains, to the best of his knowledge and belief, a just and true account of the contents of the several pack- ages mentioned in the entry, specifying the name of the vessel, of her master, and of the port from which she has arrived, and that such pack- ages contain no merchandise whatever other than the articles which are free from duty as specified above; that they are all the property of a person named, who has arrived, or is expected to arrive in the United States within one year, and are not directly or indirectly imported for any other, or intended for sale. Section 2800. Whenever the person making entry of any articles free from duty, as speeified in the preceding section, is not the owner of them he shall give bond with one or more sureties, to the satisfaction of the collector, in a sum equal to- the duties on like articles imported subject to duty, upon the condition that the owner of the articles shall, within one year (but within three months of his arrival in the United States), personally make an oath such as is prescribed in the preceding section. Section 2801. On compliance with the two preceding sections, and not otherwise, a permit shall be granted for landing such articles. But whenever the collector thinks proper he may direct the baggage of any person arriving within the United States to be examined by the sur- veyor of the port, or by an inspector of the customs, who shall make a re- turn of the same, and if any articles are contained therein which in the opinion of the collector ought not to be exempted from duty, due en- try of them shall be made, and the duties thereon paid. Section 2803. Any baggage or personal effects arriving in the United States, in transit to any foreign country, may be delivered by the par- ties having it in charge to the collector of the proper district, to be by him retained, without the payment or exaction of any import duty, or to be forwarded by such collector to the collector of the port of depart- ure, and to be delivered to such parties ou their departure for their for- eign destination, under such rules, regulations, and fees as the Secre- tary of the Treasury may prescribe. Section 2837. All invoices shall be made out in the weights or meas- ures in general use in the country or place in which the goods are pro- cured for importation to the United States, and shall contain a true statement of the actual weights or measures of such merchandise, with- out any respect to the weights or measures of the United States. Section 2838. All invoices of merchandise subject to a duty ad val- orem shall be made out in the currency of the place or country from whence the importation shall be made, and in the currency actually paid therefor, and shall contain a true statement of the actual cost of such merchandise in such foreign currency or currencies, without any respect to the value of the coins of the United States, or of foreign coins by law made current within the United States, in such foreign place or country. Section 2841. Whenever merchandise imported into the United States is entered by invoice, one of the following oaths, according to the nature of the case, shall be administered by the collector of the port, at the time of entry, to the owner, importer, consignee, or agent. Pro- vided , That if any of the invoices or bills of lading of any merchan- dise imported in said v essel, which should otherwise be embraced in said entry, have not been received at the date of the entry, the affidavit may state the fact, and thereupon such merchandise of which the invoices or bills of lading are not produced shall not be included in such entry, but may be entered subsequently. 86 REPORT OF THE TARIFF COMMISSION. Oath of consignee , importer , or agent. I, , do solemnly and truly swear (or affirm) that the in- voice and bill of lading now presented by me to the collector of are the true and only invoice and bill of lading by me received, of all the goods, wares, and merchandise imported in the , whereof is master, from , for account of any person whomsoever, for whom I am authorized to enter the same ; that the said invoice and bill of lading are in the state in which they were actually received by me, and that I do not know nor believe in the existence of any other invoice or bill of lading of the said goods, wares, and merchandise ; that the entry now delivered to the collector contains a just and true account of the said goods, wares, and merchandise, according to the said invoice and bill of lading ; that nothinghas been, on my part, nor, to my knowledge, on the part of any other person, concealed or suppressed, whereby the United States may be defrauded of any part of the duty lawfully due on the said goods, wares, and merchandise ; that the said invoice and the declaration therein are in all respects true, and were made by the person by whom the same purports to have been made, and that if, at anytime hereafter, I discover any error in the said invoice, or in the account now rendered of the said goods, wares, and merchandise, or receive any other invoice of the same, I will immediately make the same known to the collector of this district. And I do further solemnly and truly swear (or affirm) that to the best of my knowledge and belief (insert the name and residence of the owner or owners), is (or are) the owner (or owners) of the goods, wares, and merchandise mentioned in the annexed entry; that the in- voice now produced by me exhibits the actual cost (if purchased) or fair market value (if otherwise obtained) at the time or times, and place or places when or where procured (as the case may be), of the said goods, wares, and merchandise, including all cost for finishing said goods, wares, and merchandise to their present condition, and no other or different dis- count, bounty, or drawback, but such as has been actually allowed on the same. Oath of owner in cases where merchandise has been actually purchased. 1 , do solemnly and truly swear (or affirm) that the en- try now delivered by me to the collector of , contains a just and true account of all the goods, wares, and merchandise imported by or consigned to me, in the , whereof is master, from ; that the invoice which I now produce contains a just and faith- ful account of the actual cost of the said goods, wares, and merchan- dise, including all cost of finishing said goods, wares, and merchandise to their present condition, and no other discount, drawback, or bounty but such as has been actually allowed on the same; that I do not know or believe in the existence of any invoice or bill of lading, other than those now produced by me, and that they are in the state in which I act- ually received them. And I further solemnly and truly swear (or affirm), that 1 have not in the said entry or invoice, concealed or suppressed anything whereby the United States may be defrauded of any part of the duty lawfully due on the said goods, wares, and merchandise; that the said invoice and the declaration thereon are in all respects true, and were made by the person by whom the same purports to have been made, and that if at any time hereafter I discover any error in the said invoice or in the account now produced of the said goods, wares, and merchandise, or receive any other invoice of the same, I will immediately make the same known to the collector of this district. KEPORT OF THE TARIFF COMMISSION. 87 Oath of manufacturer or owner in cases ivhere merchandise has not been actually ‘purchased. I, , do solemnly and truly swear (or affirm) that the entry now delivered by me to the collector of contains a just and true account of all the goods, wares, and merchandise imported by or consigned to me in the , whereof is master, from ; that the said goods, wares, and merchandise were not actually bought by me, or by my agent, in the ordinary mode of bargain and sale, but that, nevertheless, the invoice which 1 now produce contains a just and faithful valuation of the same, at their fair market value, at the time or times, and place or places, when and where procured for my account (or for account of myself or partners) ; that the said invoice contains also a just and faithful account of all the cost for finishing said goods, wares, and merchandise to their present condition, and no other discount, drawback, or bounty but such as has been actually allowed on the said goods, wares, and merchandise ; that the said invoice and the declaration thereon are in all respects true, and were made by the person by wdiom the same purports to have been made; that I do not know nor believe in the existence of any invoice or bill of lading other than those now produced by me, and that they are in the state in which I actually received them. And I do further solemnly and truly swear (or affirm) that I have not in the said entry or invoice concealed or sup- pressed anything whereby the United States may be defrauded of any part of the duty lawfully due on the said goods, wares, and merchandise, and that if at any time hereafter I discover any error in the said invoice, or in the account now produced of the said goods, wares, and merchan- dise, or receive any other invoice of the same, I will immediately make the same known to the collector of this district. Section 2846. Whenever merchandise belongs to the estates of de- ceased persons or of persons insolvent, ftho have assigned the same for the benefit of their creditors, or is consigned to such deceased or insol- vent persons, entry thereof may be made by, and the oaths to invoices administered to, the executors, administrators, or assignees of such per- sons, as the case may be. Section 2853. All invoices of merchandise subject to ad valorem duty, or to any duty based on value, imported from any foreign country, shall be made in triplicate, and signed by the persons owning or ship- ping such merchandise, if the same has actually been purchased, or by the manufacturer or owner thereof, if the same has been procured oth- erwise than by purchase, or by the duly authorized agent of such pur- chaser, manufacturer, or owner. • Section 2854. All such invoices shall, at or before the shipment of the merchandise, be produced to the consul, vice-consul, or commercial agent of the United States in the country of and nearest the place in which the goods were originally procured, for exportation to the United States, for the use 4>f the United States, and shall have indorsed theren, when so procured, a declaration signed by the purchaser, man- ufacturer, owner, or agent, setting forth that the invoice is in all re- spects true; that it contains, if the merchandise mentioned therein is subject to ad valorem duty and was obtained by purchase, a true and full statement of the time when and the place where the same was pur- chased, and the actual cost thereof, and that no discounts, bounties, or drawbacks are contained in the invoice but such as have actually been allowed thereon ; and when obtained in any other manner than pur- chase the actual market value thereof at the time and place when and 88 REPORT OF THE TARIFF COMMISSION. where the same was procured or manufactured ; and that no different invoice of the merchandise mentioned in the invoice so produced has been or will be furnished to any one. If the merchandise was act- ually purchased the declaration shall also contain a statement that the currency in which such invoice is made out is the currency which was actually paid for the merchandise by the purchaser. Section 2857. Whenever, from a change of the destination of any mer- chandise, after the production of the invoice thereof to the consul, vice- consul or commercial agent, or from other cause, the triplicate transmitted to the collector of the port to which such merchandise was originally des- tined is not received at the port where the same actually arrives, and where it is desired to make entry thereof, the merchandise may be ad- mitted to an entry on the execution by the owner, consignee, or agent, of a bond, with sufficient security, in double the amount of duty appar- ently due, conditioned for the payment of the duty which shall be found to be actually due thereon. The collector of the port where such entry shall be made shall immediately notify the consul, vice-consul, or com- mercial agent to whom such invoice lias been produced to transmit to such collector a certified copy thereof, and such consul, vice consul, or commercial agent, shall transmit the same accordingly without delay, and the duty shall not be finally liquidated until such triplicate, or a certified copy thereof, shall have been received. Such liquidation, how- ever, shall not be delayed longer than eighteen months from the time of making such entry. Provided , That the collector may, if satisfied that there is no fraud intended, at his discretion, admit the merchandise to entry and liquidation on the invoice as filed at the time of entry, with- out requiring such triplicate invoice, or bond. Section 2859. The six preceding sections shall not apply to coun- tries where there is no consul, vice-consul, or commercial agent of the United States, and whenever the value of the imported merchandise does not exceed one hundred dollars, the collector may admit it to entry without invoice, if he is satisfied that the importation was made in good faith and without any purpose of defrauding the revenue. Section 2860. Except as allowed in the four preceding sections, and by the act approved June 22, 1874, entitled u An act to amend the cus- toms revenue laws, and to repeal moieties,” no merchandise imported from any foreign place or country shall be admitted to an entry unless the invoice presented in all respects conforms to the requirements of sections twenty-eight hundred and fifty-three, twenty-eight hundred and fifty-four, and twenty-eight hundred and fifty-five, and has thereon the certificate of the consul, vice-consul, or commercial agent in those sections specified, nor unless the invoice is verfied at the time of mak- ing such entry by the oath of the owner or consignee, or of the author- ized agent of the owner or consignee, certifying that the invoice and the declaration thereon are in all respects true, and were made by the per- son by whom the same purports to have been made, nor unless the trip- licate transmitted by the consul, vice-consul, or commercial agent to the collector has been received by him, except as provided in section two thousand eight hundred and fifty-seven. Section 2862 . All consular officers shall require, before certifying any invoice under the provisions of the preceding sections, satisfactory evidence, either by the oath, affirmation, or declaration (according to the forms of law of the country in which the same is made or taken) of the person presenting such invoices that such invoices are correct and true, and were made at the place in which the goods were originally procured for exportation to the United States, which oath, affirmation, ordeclara- REPORT OF THE TARIFF COMMISSION. 89 tion shall be attached to the invoice, and certified by the consul. And in the performance of these duties the consular officers shall be gov- erned by such general or special regulations or instructions as may from time to time be established or given by the Secretary of State. Section 2869. The collector shall, according to the best of his judg- ment or information, make a gross estimate of the amount of the duties on the merchandise to which the entry of any owner or consignee, his factor or agent, shall relate, which estimate shall ^be endorsed upon such entry and signed by the officer making the same. The amount of the estimated duties having been first paid, or secured to be paid, pur- suant to the provisions of this title, the collector shall grant a permit to land the merchandise whereof entry has been made, and then, and not before, it shall be lawful to laud the merchandise. Provided , That the merchandise, after examination thereof by the proper officers, shall be liable for any additional duties found to be due on the final adjust- ment or liquidation thereof, which final adjustment or liquidation shall be verified by the naval officer, if any. Section 2870. All permits shall specify as particularly as may be, agreeably to the bills of lading, the merchandise to be delivered, name- ly, the number and description of the packages, whether trunk, bale, chest, box, case, pipe, hogshead, barrel, keg, or any other packages whatever, with the mark and number of each package, and as far as circumstances will admit, the contents thereof agreeably to the invoices and entry, together with the names of the vessel and master, in which, and the place from whence they were imported; and no merchandise shall be delivered by any inspector or other officer of the customs that does not fully agree with the description thereof in such permit. Pro- vided, That in case of such disagreement resulting from errors in the bills of lading, the merchandise may be sent into general orders store, at the expense of the importing vess&l, unless otherwise ordered by the collec- tor; and provided further that the collector may order delivery thereof when satisfied of the identity of the merchandise. Section 2882. No merchandise brought in any vessel from any for- eign port or place, requiring to be weighed, gauged or measured, in or- der to ascertain the duties thereon, shall without the written consent of the collector be removed from any wharf or place, upon which the same may be landed or put, before the same shall have been so weighed, gauged, or measured, and if spirits, wines, or sugars, before the proof, or quality and quantity thereof is ascertained and marked thereon, by or under the direction of the collector, and if any such merchandise shall be removed from such wharf or place, unless with snch consent of the collector, obtained before the same has been so weighed, gauged, or measured, and if spirits, wines or sugars, before the proof or quality and quantity has been so ascertained and marked, the same shall be forfeited, and may be seized by any officer of the customs or inspection. Section 2885. The officers of inspection of any port where distilled spirits or wines shall be landed shall, upon the landing thereof, and as soon as the casks, vessels, and cases containing the same shall be in- spected, gauged, or measured, brand or otherwise mark in durable characters the several casks, vessels, and cases containing the same, and the marks shall express the number of casks, vessels, or cases, whether of spirits or wines, marked by each officer, respectively, in each year in progressive numbers for each of the articles ; also the port of importation, the name of the vessel, and the surname of the master; also each kind of spirits or wines, for which different rates of duty are or shall be imposed, the number of gallons in each cask or case, and 90 REPORT OF THE TARIFF COMMISSION. the rate of proof, if spirits ; also the name of the surveyor or chief offi- cer of inspection for the port, and the date of importation ; of all which particulars the chief officers of inspection shall keep fair and correct accounts, in hooks to be provided for that purpose, and make return of the same to the surveyor. Section 2887. If any package whatever which has been so reported is wanting and not found on board such vessel, or if the merchandise ou board such vessel does not otherwise agree with the report or mani- fest delivered by the master of any such vessel, in every such case the master shall be liable to a penalty of live hundred dollars, except that if it is made to appear to the satisfaction of the collector, or in case of trial for the penalty to the satisfaction of the court, that no part what- ever of the merchandise of such vessel has been unshipped, landed, or unladen since it was taken on board, except as specified in the report or manifest, and pursuant to permits, or that the disagreement is by accident or mistake, in such case the penalty shall not be inflicted. But in all such cases the master of any vessel shall be required and shall make a post entry or addition to the report or manifest by him delivered of any and all merchandise omitted to be included and re- ported in such manifest, and- it shall not be lawful to grant a permit to unlade any such merchandise so omitted before such post entry or ad- dition to such report or manifest has been made. Section 2898. In estimating the allowance for tare in all chests, boxes, cases, casks, bags, or other envelope or covering of all articles imported liable to pay any duty, where the original invoice is produced and the tare shall be specified therein, the collector, if he sees fit, or the collector and naval officer, if any, if they see fit, may estimate the tare according to such invoice, but otherwise the real tare shall be al- lowed, and may be ascertained under suqh regulations as the Secretary of the Treasury may from time to time prescr ibe, but in no case shall there be any allowance for draff. Section 2900. The owner, consignee, or agent of any merchandise which has been actually purchased, or procured otherwise than by pur- chase, at the time, and not afterward, when he shall produce his original invoice to the collector and make and verify under oath or affirmation his written'entry of his merchandise, may make such addition in the entry to the cost or value given in the invoice as in his opinion may raise the same to the actual market value or wholesale price of such merchandise at the period of exportation to the United States in the principal markets of the country from which the same has been imported, and the col- lector within whose district the same may be imported or entered shall cause such actual value or wholesale price to be appraised, but the duty shall not however be assessed upon an amount less than the invoice or entered value, except in case of mistake or misdescrip- tion of the goods in the invoice, clearly established to the satisfac- tion of the collector, and in all cases where such market value or wholesale price as appraised, estimated, and ascertained under the cus- toms laws of the United States, of any article or articles of imported merchandise subject to ad valorem duty, or to duty based in whole or in part on value, shall exceed the entered value at the custom house (whether such entered value be based on a certified invoice or any other document whatever admitted or received in lieu of such certified in- voice) more than five per centum, and not more than fifteen per centum of the value stated in said entry thereof, then in addition to the duty imposed by law on such article or articles of merchandise there shall be levied, collected, and paid two per centum of such total appraised REPORT OF THE TARIFF COMMISSION. 91 market value or wholesale price thereof for each full or entire one per centum of such additional value above such five per centum, as a penalty for such undervaluation ; and if such appraised value shall exceed said entered value more than fifteen per centum the said entry shall be deemed and held to be presumptively fraudulent, and the collector shall seize such article or articles of merchandise, and proceed as in other cases of forfeiture for violation of the customs laws ; provided that the penalties and forfeiture in this section provided for shall only apply to the particular articles in each invoice which are undervalued; and pro- vided further, that when it shall be made to appear to the collector by satisfactory evidence that the said undervaluation on said entry was caused by a manifest clerical error, or mere mistake, and without any intention to undervalue or defraud, the collector shall so certify to the Secretary of the Treasury, and with such certificate transmit the evi- dence in support thereof, and the Secretary of the Treasury, if fully satisfied that said certificate is sustained by said evidence, and not oth- erwise, may remit said penalty, or may remit said forfeiture at any time before the commencement ot legal proceedings for forfeiture, and not afterwards; and in such legal proceedings the fact of such undervalu- ation shall be presumptive evidence of fraud, and the burden of proof shall be on the claimant to rebut the same, and forfeiture shall be ad- judged unless he shall fully rebut said presumption of fraudulent in- tent by sufficient evidence. Section 2902. It shall be the duty of the appraisers of the United States, and every of them, and every person who shall act as such ap- praiser, or of the collector and naval officer, as the case may be, by all reasonable ways and means in his or their power, to ascertain the proof of distilled spirits imported, rating such spirits according to their re- spective degrees of proof, as defined by the laws imposing duties on spirits; to ascertain the character of imported merchandise, and also to ascertain, estimate, and appraise the true and actual market value and wholesale price, any invoice or affidavit thereto to the contrary not- withstanding, of the merchandise at the time of exportation, and in the principal markets of the country whence the same has been im- ported into the United States, and the number of such goods, parcels, or quantities, and such actual market value or wholesale price of every of them, as the case may require. All such merchandise being manu- factured of wool, or whereof wool shall be a component part, which shall be imported into the United States in an unfinished condition, shall in every such appraisal be estimated to have been at the time of exportation and place whence the same was imported into the United States of as great value as if the same had been entirely finished. That section 29i>7 be, and the same is hereby, repealed. That section 2908 be, and the same is hereby, repealed. Section 2926. All merchandise, of which incomplete entry has been made, or an entry without the specification of particulars, either for want of the original invoice or for any other cause, or which has received damage during the voyage, shall be conveyed to some warehouse or storehouse, to be designated by the collector, in the parcels or packages containing the same, there to remain with due and reasonable care, at the expense and risk of the owner or consignee, under the care of some proper officer, until the particulars, cost, or value, as the case may re- quire, shall have been ascertained either by the exhibition of the origi- nal invoice thereof, or by appraisement, and until the duties thereon shall have been paid or secured to be paid, and a permit granted by the collector for the delivery thereof. 92 REPORT OF THE TARIFF COMMISSION. Section 2927. In respect to articles that have been damaged during the voyage, whether subject to a duty ad valorem, or chargeable with a specific duty, either by number, weight, or measure, the appraisers shall ascertain and certify to what rate or percentage the merchandise is damaged, and the rate or percentage of damage so ascertained and certified shall be deducted from the original amount, subject to a duty ad valorem, or from the acutal or original number, weight, or measure, on which specific duties would have been computed. No allowance, however, for the damage on any merchandise that has been entered, and on which the duties have been paid or secured to be paid, and for which a. permit has been granted to the ow T ner or consignee thereof, and which may, on examining the same, prove to be damaged, shall be made, unless proof to ascertain such damage shall be lodged in the custom-house of the port where such merchandise has been landed, within ten days after the landing of such merchandise: Provided, That no claim for damage shall be received or allowed until after due entry of the merchandise. Se ction 2932. The decision of the respective collectors of customs as to all fees, charges, and exactions of whatever character, other than those relating to the rate and amount of duties to be paid on the tonnage of vessel, or on merchandise, and the costs and charges thereon, claimed by them, or by any of the officers under them in the performance of their official duty, shall be final and conclusive against all persons interested in such fees, charges, or exactions, unless notice that an ap- peal will be taken from such decision to the Secretary of the Treasury shall be given within ten days from the making of such decision, and unless such appeal shall actually be taken within thirty days from the making of such decision ; and the decision of the Secretary of the Treasury shall be final and conclusive upon the matter so appealed unless suit shall be brought for the recovery of such fees, charges, or exactions within the period of ninety days after such decision. No suit shall be maintained in any court for the recovery of any such fees, costs, and charges, alleged to have been erroneously or illegally exacted, until the decision of the Secretary of the Treasury shall have been first had on such appeal, unless such decision of the Secretary shall be delayed more than ninety days from the date of such appeal in case of an entry at any port east of the Rocky Mountains, or more than five months in case of the entry west of those mountains. Section 2939. The collector of the port of New York shall not under any circumstances direct to be sent for examination and appraisement less than one package of every invoice, and one package at least out of every ten packages of merchandise, and a greater number should he, or the appraiser, or any assistant appraiser, deem it necessary. When the Secretary of the Treasury, however, from the character and descrip- tion of any class of merchandise, may be of the opinion that the exami- nation of a less proportion of packages will amply protect the revenue, lie may by regulation direct a less number of packages to be examined. And when from the character of any class of goods it is in his opinion unnecessary to remove the same to the public stores, he may by regu- lation permit their examination for appraisal at such other places as he may direct. Section 3058. All merchandise imported into the United States shall, for the purpose of this title, be deemed and held to be the property of the person to whom the merchandise may be consigned, unless the act- ual ow ner at the time of the original exportation of the same shall make the entry thereof on the bills of lading and invoice for the same. Any REPORT OF THE TARIFF COMMISSION. 93 sale, transfer, or assignment prior to the entry and payment of the du- ties on such merchandise, and the payment of all bonds then due and unsatisfied by the consignee, to the contrary notwithstanding, and the holder of any bill of lading consigned to order and properly indorsed, shall be deemed the consignee thereof. Amend section 9, anti-moiety act, Heyl, p. 151, so as to read: Section 9. That except in the case of personal or household effects, books, tools, or implements accompanying the passenger no importa- tion exceeding one hundred dollars in dutiable value of goods bearing an ad valorem duty, or duty based on value, shall be admitted to entry without the production of a duly certified invoice thereof or the docu- ments to be received in lieu thereof, as specified in sections twenty-seven hundred and eighty -five (2785) and twenty seven hundred and eighty- eight (2788), together with an affidavit made by the owner, importer, or consignee before any officer authorized to administer oaths, showing why it is impracticable to produce such invoice. That section nine (9) of the act approved June 10, 1880, be amended so as to read as follows : Section 9. That no merchandise shall be shipped under the pro- visions of this act after such merchandise shall have been landed fifteen days from the importing vessel, and merchandise not entered within such time shall be sent to a bonded warehouse by the collector as un- claimed, and held until regularly entered and appraised: Provided, That the collector may, when in his judgment it is necessary, with the con- sent of the consignee and at his expense and risk, send any such mer- chandise to ajbonded warehouse at any time after it is landed, subject to the right of transportation under this act within fifteen days of the landing of the same. PROPOSED BILL FOR CUSTOMS COURT. A BILL to create a customs court and provide a better system for the trial of cus- toms revenue cases. Be it enacted by the Senate and House of Representatives of the United States in Congress assembled : Section 1. That a court shall be and is hereby constituted, to be known as the Customs Court of the United States, to consist of a pres- ident judge and two associate judges (at least one of whom shall be a customs expert, and shall have had at least ten years’ experience in the customs service), who shall be appointed and qualified and hold their officesin all respects as the other judges of the courts of the United States. The salary of the president judge shall be dollars, and of each of the associates dollars per year, to be paid in the same manner as the salaries of other judges. Section 2. The jurisdiction of said court shall extend to all questions arising under the laws of the United States imposing customs and ton- nage duties which have heretofore been the subject of protest and ap- peal to the Secretary of the Treasury, and shall include all questions of classification and rates of duty on imported goods, wares, and merchan- dise, and the mode of determining said rates ; and the decision of said court, as to all such matters, shall be final and conclusive. Provided, That on motion filed by either party within thirty days oi the entry of any decision, said court may for cause set aside the judg- ment and grant a rehearing, and the case shall then proceed to a hear- ing and determination in all respects as if said judgment had not been entered. 94 REPORT OF THE TARIFF COMMISSION. Section 3. In addition to the prohibitions of section seven hundred and thirteen (713) of the Revised Statutes, it shall not be lawful for any of said judges to be interested in any way in any importing or mercan- tile business, or engaged or interested in importations of merchandise or property of any description, or to be partners of or interested in business with any importer of such gocds or property. Section 4. Said court shall, so far as the same may be necessary to the exercise of its jurisdiction, have the $ame power as the circuit courts of the United States to issue writs, processes, and subpoenas, and com- pel the attendance of witnesses, issue commissions to take testimony, impose and administer judicial oaths, compel the production of books or writings in the possession of parties, or others, which contain evi- dence as to any matter pending before it, to issue attachments and executions, to enforce its judgments and decrees, to punish by hue and imprisonment for contempts of its authority, and make rules and regu- lations for the transaction of its business, and such powers shall in all respects be subject to the same limitations and restrictions as in the circuit courts. Section 5. All writs, processes, and subpoenas issuing from said court shall be under the seal thereof and signed by its clerk, and bear teste in the name of the president judge of said court. Section fi. The regular sessions of said court shall be held iu the city of New York, in rooms to be furnished for the purpose by the Sec- retary of the Treasury, in or reasonably near to the custom-house in said city, and said court shall be open daily, except Sundays and legal holidays, for the transaction of business ; but the court shall hold at least one session in each year at the city of New Orleans and one ses- sion at the city of San Francisco, and from time to time, as the court may deem it necessary, special sessions may be held at the custom- house of any other port of entry, as the business may require, and the necessary traveling expenses of the judges and clerk shall be paid out of the Treasury of the United States. Section 7. Said court shall appoint a clerk, who shall receive an annual salary of dollars, and no other fees or compensation, and who shall discharge for said court the same duties as are required by law r of the clerks of circuit courts, and such other duties as may be necessary or as the court may direct ,* he shall be qualified and give bond, as is required by law of the clerks of the circuit courts ; shall hold his office during the pleasure of the court, and have charge of its seal and records ; and iu the discharge of his duties shall iu all respects be subject to the same laws as the clerks of said circuit courts. The process of said court shall be served by the marshal of any district to which it may be issued, and may be returned by mail; and said court shall appoint one or more bailiffs, as may be necessary, who shall be paid as the bailiffs in circuit courts. Section 8 . Section two thousand nine hundred and thirty-one (2931) of the Revised Statutes shall be, and is hereby, amended so as to read as follows : Section 2931. On the entry of any vessel, or of any merchandise, the decision of the collector of customs at the port of importation and entry, as to the rate and amount of duties to be paid on the tonnage of such vessel, or on such merchandise, shall be final and conclusive against all persons interested therein, unless the owner, master, commander, or consignee of such vessel, in the case of duties levied on tonnage, or the owner, importer, consignee, or agent, of the merchandise, in the case of duties levied on merchandise, shall, within ten days after public no- REPORT OP THE TARIFF COMMISSION. 95 tice is posted in tbe custom house of the ascertainment and liquidation of the duties on any entry by the proper officers of the customs, as well in cases of merchandise entered in bond as for consumption, give notice of protest, in writing, to the collector on each entry, if dissat- isfied with his decision, setting forth therein, distinctly and spe- cifically. the grounds of his objection thereto (but protests lodged before liquidation shall be void), on the receipt of which the collector shall reconsider the matters complained of, and again decide the same; and on deciding the same, the collector shall notify the importer, his agent, or attorney, in writing, by mail, of his determination thereof, and such determination shall be final and conclusive of such ascertainment and liquidation, unless the importer shall within twenty days of the mailing of such notice of decision appeal therefrom to the customs court, by giving the collector notice of such appeal, and filing with the collector a bond, with sufficient sureties, payable to the United States, in double the amount of all the duties unpaid, if any, and of the costs and charges on such vessel or merchandise as liquidated, conditioned that he will abide by and satisfy the judgment or decree of said customs court on said appeal, and pay all moneys and costs which may be ad- judged against him in said customs court, said bond shall be subject to the approval of the collector, and he may require the sureties thereon to justify in double the amount thereof. Provided , however , That such importer, owner, consignee, or agent, may in such cases, if said merchan- dise is still in the possession of the collector, and there has been no un- dervaluation or fraud in the entry thereof, withdraw said merchandise from entry and export the same, at any time before the time herein fixed for the giving of said bond, and before said bond is filed, if he de- sires to do so; and in that case no duties shall be charged thereon, and said merchandise shall not thereafter be subject to entry; but in case of such withdrawal for export, such importer, owner, consignee, or agent, shall pay all the actual cost and expenses on said entry. Section 9. Upon the filing and approval of said appeal bond, as provided in section twenty-nine hundred and thirty-one (2931) as amended above, the collector shall deliver said merchandise, if any shall remain in his possession, to the importer, owner, consignee, or agent entitled to the same, and shall immediately forward the entry of said goods, and said protest, together with all testimony in his posses- sion in relation to said entry, and all other papers, writings, and sam- ples in any way connected wi f h said entry and liquidation, including the decision of the collector, and a statement ot the liquidation of the duties on said entry, to the clerk of the customs court, who shall there- upon docket the case in the name of the United States against said ap- pellant, and shall carefully file and preserve the papers and samples so transmitted to him; and thereupon said case shall be ready for hearing without the filing of any other pleadings, unless the court shall other- wise direct ; but either party may offer additional testimony by deposi- tion, upon notice, or orally, under such regulations as the court may make in relation thereto. Section 10. On the filing of an appeal in case of an entry of mer- chandise, the court shall cause a notice of the same to be given in some newspaper published at the port of importation, and also in a newspa- per to be designated for that purpose by the court, published and of general circulation in the city of New York, describing the merchan- dise entered, by its usual commercial designation, and such general de- scription as may, in the opinion of the court, be necessary to indicate the character of the merchandise together with the classification thereof, 96 REPORT OF THE TARIFF COMMISSION. and rate of duty thereon, as claimed by the appellant, and also as de- cided by the collector. And persons claiming to have an interest in the questions involved in the case, may, on application, at the discre- tion of the court, be allowed to offer testimony, and be heard in argu- ment therein, by themselves or counsel; but such persons shall pay their own costs and shall not recover the same in any case. Section 11. Each case so transmitted to said court shall be heard and decided as soon as possible, having due regard to a proper consid- eration of the same ; but the decision shall not be deferred more than ninety days from the date of the receipt and docketing of said appeal, unless for cause to be entered on the docket of said court : Provided , That the court shall not lose jurisdiction of said case, nor shall its ju- risdiction be affected in any way by any delay in said decision beyond the said ninety days after the receipt and docketing of said appeal. Section 12. In deciding each case the said court shall determine all matters involved in the appeal, or in any way connected with the entry, and shall determine the rates and amounts of the duties and charges to be paid by reason of the same, and render judgment therefor in favor of the United States and against said appellant, including in said judgment interest on said duties and charges from the date of entry, if entered for consumption, or from the date of the withdrawal of entry for consumption, if originally entered in bond, at the rate of six per centum per annum. If the decision of the collector is affirmed, the judgment shall be for the amount of the duties remaining unpaid as liquidated by the customs officers, with interest as aforesaid, and for the costs of said appeal : and if the decision of the collector is reversed, in whole or in part, then the court shall determine the rates of duties to be charged, and may liquidate the entry accordingly, or refer the same to the proper customs officers, or to the clerk of said court, for liquidation ; and in such case when the said entry has been liquidated by or under the order of the court, it shall render judgment in favor of the United States and against the appellant for the amount due on said entry, with interest as aforesaid ; but if the decision of the collector is wholly reversed, such judgment shall be without costs, in which case the United States shall pay the costs on said appeal; and if the decis- ion of the collector is reversed in part and affirmed in part, the court shall make such order as to costs as it may deem equitable; the judg- ment rendered shall in any case bear interest from the date thereof at the rate of six per cent, per annum, and shall be payable in coin, and execution may issue from said court to the marshal of au 3 r district in the United States, to collect the same at any time after the eutry of said judgment, and suit may be brought and judgment rendered upon said appeal bond iu the proper circuit court (if said judgment is not paid) for the amount of said judgment, costs, and interest. Section 13. Thatsaid court shall cause synopses of its decisions from time to time to be prepared, describing therein the merchandise in- volved by its commercial designation, and such other pertinent descrip- tion as may be necessary to a full understanding of its holdings, and the classification of the same and rates of duties thereon as determined by said court, and all other matters by it decided ; it shall certify said synopses to the Secretary of the Treasury, who shall cause the same to be printed and furnished to the several custom-houses for the use of the revenue officers in the discharge of their duties, and such decisions shall be binding on the several collectors and other revenue officers as to all matters of classification of merchandise, and the duties chargeable thereon, and all other matters so decided in said court; and the hold- REPORT OF THE TARIFF COMMISSION. 97 ings of said court shall be followed in the administration of the customs revenues by all the officers of the government having charge thereof. Section 14. The President shall, by and with the advice and consent of the Senate, appoint a customs attorney, who shall be qualified and give bond and hold his office the same as district attorneys, and receive a salary of dollars per year while holding said office. It shall be his duty to act as the attorney of the United States in all cases pending in the customs court; and while holding said office he shall not be en- gaged in the business of importation, nor in any way interested in such business. The Attorney-General may also, when in his judgment it may be necessary, appoiut other counsel to assist said customs attorney in the discharge of his duties in any case or cases. Section 15. That from and after the taking effect of this act, no col- lector or other officer of the customs shall be in any way liable to any master, owner, commander, or consignee of any vessel, or owner, im- porter, consignee, or agent of any merchandise, or any other person, for or on account of any rulings or holdings as to the tonnage, dues, and charges on said vessel, or the classification of said merchandise, or the duties charged thereon, or the collection of any dues, charges, or duties on or on account of said vessel or merchandise, or any other matter or thing as to which said master, owner, commander, or consignee of such vessel, or owner, importer, consignee, or agent of such merchandise, might under this act be entitled to appeal from the decision of said col- ector to the customs court. Section 16. That sections twenty- nine hundred and thirty-one (2931), three thousand and eleven (3011), three thousand and twelve (3012), three thousand and thirteen (3013) of the Revised Statutes, the first, second, and third sections of the act of March 3, 1875, entitled “An act restricting the refunding of customs duties and prescribing certain regulations of the Treasury Department,” and all other acts and parts of acts inconsistent with the provisions of this act, are hereby repealed; but such repeal shall not affect pending actions or causes of action which have already accrued, nor shall anything in this act contained be construed to prevent the correction by the collector, or by the Sec- retary of the Treasury, of any manifest mistakes or clerical errors in any entry or liquidation, whether for or against the government, at any time within one year of the date of such entry; but the power to cor- rect such mistakes or errors shall still continue to exist as heretofore within said time. H. Mis. 6 7 98 REPORT OF THE TARIFF COMMISSION. © 2 g >5 & I § - I | i i < v 1 019 220 556 799 074 sllslsl t>00 OO Cvj siialsSllilsIg llllllilH 1870. ! 1 cf 00 " g" of ■S'” cf tf S'8&®g§35g!gH ,0 iS Cf cf Cf Iff r-T C- CD iSSI^pi^li :g liiiilsSllilil I £ s s g g wV *' s gig £gg" NOW S353S11SS liliWii TH Iff TH tjT 00 ** < 0 " r-T 00 ' 1111=111 Ssiiiisi |g=-c-g®- S -«-g 21111111 iwilsf ssf *§ i -‘?f s l=lllllSsll2l§SllSI»Isllllla»S2Sl!IS cf i-T iff ■*£ co ^ h to im‘ 10 « oo" « r-T 00" r-T co t-f cfeo“®%fjH saiHs^isssssssssiiaaigggsiisisssEss cf i-T CO 10 CO cf m o'" ri in" r-T «> JO r-T j-H* CO 88888888 Sf”'S“ 38 Sliisss S'-'S- oo-g lls§§l!§lil SsS-'-SS-s'S 83833888888 mmmmM s“‘s“-'Ss-*s lesislsll s giisiiss :i -S'- 8888883 IISl-11 cfwo in oo* llllisP8sS S ■ csTntjTin" in* in wt-" I Hangings r-T i-T in* cf en* m* in* t> | slslall 53 n'nV r^'m* 8888*83 -Tin ,-TtjT 111 iiiiiiil Appendix I. — Table showing the progress of manufactures in each State and Territory of the United States , §c. — Continued. 100 REPORT OF THE TARIFF COMMISSION. 1 siassgiSaSisssisESaiiisfiSfiffKfffWfff 3 S^ ef S"S'°" SVsgsfe" |§ § jMMMmMMmMmmmmmMm 1 $ o' 2, 880, 578 68, 253, 228 81, 924, 555 I 9, 892, 902| 5, 412,102; 2, 447, 969 16, 925, 564 57, 580, 886 42, 803, 469 13, 971, 325 4, 357, 408 37, 931, 240 15, 587, 473 38, 193, 254 41, 735, 157 255, 545, 922 32. 658, 356 3, 373, 172 6, 590, 687 41, 782, 731 8 1 illlllilBp i lC 5c' i-T 00 co* r-T cf o o' : Mt " £^3 S'* CO £ 11 S Ills 111 £51828883 : :§lsitli§§ 1 si rf lift Mi iggiliWi i iSiliHiiiS s' ■>* ^ CM CO 00 CO • ~4 CO Tf CO* l> f-T cvf r*T rH r— i • CM WCOiOH CM : jSS iiiiisgsirisiissiiiiiiiiiiiiisiiiiifi “ |SSs‘53SS|§S^'S"“"S‘| |2£”|S§ Sisisfisiiiiifisiiissisi l - ”§-■§■ s-*"«is SSS®Sa§SS$S^‘2'"^25| S25”SES sisssssesss' CM 'COHOOO!M(Ma5COlO 8 IS 1 fill iSISiSilSsill ‘11 1 1221 tmmmm 50* Cf O' £ S5 “S' S 8 1 £ ^”8 13 " §r ®»»s 111 islslsllss IOH ci S 1 2181 III jlllllWf r-T S cf r-T CO" oo' o' cf ; cf cf CO I>“ ig 5©' r-T cf §8lsii§£i S3 2 38 ~ S3 (M rH lilsgslsg fsssl’llSl' 2?f Sf^S' So* 3~ llilSs^lslillli!sSl!SlS3clsii!s!ii!II of a -ef CO o' r-T CO' Ilf iiliiesili lilllWi SB8H8S8S ifiliii'li oo' o' uscfef o'oo' riiiffiii BPSllls'S ”3 S'"' SS 5 I Sfcg^lffll REPORT OF THE TARIFF COMMISSION. 101 lllllislll smsssiH mmmm eisisif CS h fill Appendix II. Mechanical and manufacturing industries of the United Stales , by specified industries, according to the census 0/I88O. 102 REPORT OF THE TARIFF COMMISSION. REPORT OF THE TARIFF COMMISSION. 103 llSIsIllSIlllsIsesllssillllllSIlllsll&esligllssIlssi -s'g” is ss rH 's- r S" •* s'sf s””" sit'fs "“‘"‘s rt 'n vr s asIlSsilsilssssSsilsIlsIlSlIlslIlllasISslssIsISsllSI rf oo' Of -rjT o oo' — ' rf of oc*of rf c-' oo' rf of of of rf ■*+' III H f— 1 CO t— I COr-IrH r-tH i->. t> 00 r-i L-O 00 * ”1 2 S§1 ssf Cf rf 1 § 'C^COiCCO § Pi oo' of rf uf cf S? O of t—' r-T of i-T o' 'cf cf co of co'rf cf S1s1!I11!11SI!!pI11I!1!111!!!s!!!1I!sIsI!I!!I11I1!s1 oTt^'rO roef of rf oft-' tfrf of cf of oo' o' uf if oo'cf t-‘ rf of of i-T of oo' s li i 2 t 'i 2^ C005 2 ®i l 0 SS®l 50 £l t ' C 0 ^^ ? 1 ^”lS C 0 iiS”«ll § l s ^ 3 s i' DS § 2 ® s i ' rf of rf Appendix II . — Mechanical and manufacturing industries of the United States, cfc . — Continued. 104 REPORT OF THE TARIFF COMMISSION. „ ilillllselsllsslllllllssclillsislls *0 ^ CQ 1 ^ rH rHCQ CO rH CQ CO CO CQ O t— T H g C^T hT tH rH OC 05 00 Materials. lisillisilllllglgllllllllllllllisil slsg!lll»-ll»Sllla8l 3 “lsllls5S g llll *MCO Cf r-TcJlO rH* rH-Tg cf MTJO.f oqa Siii.inp soSuai m pied junonre IlllslllillSlslsI^gsIlIslIllllsssl S5SBIl”-“SSlI§lll§issaislgss|s 3 ||i r4 rH' d M £ W d Cl' © CC r-H~ Average number of bands employed. •qjno.f pan ao.ipnqo 75 1, 872 6 15 8 95 1 ;||g^ H iff : ’nV •eano^ gj OAoqn soxema^ II s i«s ; cf : : jSS53g| :s| jllSI i ! a l»‘ hc^ •eanoi! 91 OAoqn S'-q^It !8Sa8lSsS*!S58SS8ES25 a 8Ji!8S B !i 8 53S3 cT t-T r-T rH rH H cf H* 00 ©" O r-'iaVH ®ON cl 00 «««CO •sjaoni -iI s H ( msa jo aoqainjs[ ms i! si . „ ... «iy§ ® : : ; : *"S j : : s •5-= - -2 : ;5.® • .£ : «|s§ 2 : : x : Sfe-s'g :« : ^a5*2fc t(£ 5 :|s^? ,'S. Effip stall c | :S| iii-rirni rS£ II -J-— M? c «- 1 = r -- : ® ■° = .=A 5*2: £j*g §|2 3 lla^s^-43 5 as §£ 5 § § I J § I l lllf#lllll IfJlil 1 if fill 1 1 REPORT OF THE TARIFF COMMISSION. 105 IllsllalslIsISSISsISglslIISslSIllllllSSIlIslailllHS ^-^••,4 of t-T CO Wl-T HMNMh'n g£r-T r-T r-T O o' to in so" r-T c < •8.IB9i 91 9A0qB SapiJ^ 1 o' cf t* o' cf r-T oo' rf rf cf cf O r-T r-T c4 r-T Cf t~ llslllsIlIlgEglllsIlsSIllllSSsslI Jj 1 t~" cf 00 o' co co ■»*' of o' o' r-T of r-T o' jgT r-T >-1' cf o' co co o' •s^uatu -qsiTOsa jo jaqrunx oo“ o' cf ! ! 1 1 ! 1 . . ! ! • . ! i . . i I i i i . ! i 1 1 . i . r i s E 3 * £ 3 £ l! if &S id REPORT OF THE TARIFF COMMISSION. 109 Essiiiiii lIllWsI S' iSlIlilsi SSlWs'SI ass r«f sllli-gll to ler rf Illllesli lillPlll E^SSgSSS'-' LABOR AND WAGES IN EUROPE AND THE UNITED STATES. While the difference in the cost of labor in European countries and in the United States has been alluded to by a majority of the witnesses, and the higher price of American labor urged as a reason, in almost every case where witnesses have asked for increased rates of duty, it is to be regretted that the evidence taken before the Commission as a whole does not contain more than half a dozen carefully prepared comparisons of wages at home and abroad. This may be due, in part, to the fact ex- pressed by one of England’s most eminent statisticians, that “No one, unless he shall have made the attempt to obtain information as to the rate of wages, can be aware of the difficulties opposed to his success.’ 7 But while fully realizing the obstacles, it must still remain a matter of regret that so many of the most intelligent witnesses entirely neglected to give anything more definite than to say that wages were about fifty per cent, higher in America than Great Britain, and that labor in the other European countries is proportionately lower than in England. A few statements were received from artisans themselves and persons representing them. They, too, fail to furnish any definite information, but here and there a terse statement of some value may be found. For example, it is an undisputed fact that while in all, or nearly all, indus- tries in the United States the workman receives a larger income than his fellow-workmen in Europe, on the other hand his rent, clothing, and possibly his provisions cost him more here. Yet it must be remembered that he lives in a better way and has more of the comforts and luxuries of life, so that in the end, if his surplus earnings are but little in excess of the European, he has worked no harder, is more of a man, and occu- pies a position some grades higher in civilization than the European, or, to quote from the words of a witness : As American labor, owing to various causes, requires aud demands a higher wage to supply its wants, needs, or luxuries — that is, to own a decent house, read books and papers, pay pew rent and doctor’s bills, send his children to school, aud buy good clothing for himself and family — the American manufacturer must pay 100 per cent, higher wages than his foreign competitor, as well as higher taxes and rate of interest. Another witness (testifying about the manufacture of saddlery hard- ware), who lias had experience in bringing over English workmen, said : In order to keep these men in our employment we have to allow them fully as high wages, or higher wages, than they were receiving in England. The reason for this is that the cost of living in this country is much greater. Men who are able to make five shillings a day in England want to make here at least $20 a week. We have men in our employment who make from $27 to $30 a week. The reason for this difference in wages is on account of the scale of living. In England they are content to live on plain food aud ale and cheese, and the families all assist in the labor, while here the children do not want to work — society is different, and they are sent to school — and the larger salaries are based upon these different social conditions. The laborers in this country have to pay more rent, and the cost of living in every way is greater; therefore they must have larger wages. The result is that our goods cost us double the amount as far as the labor is concerned. We had a filer in our establishment who made $27 last week, and lost one day’s work during the week. That same man in England would work for one-half that sum and be fully satisfied with it, because he would be able to live on the same scale with his neighbors. But here he is not satis- fied with lower wages. REPORT OF THE TARIFF COMMISSION. Ill One of the most striking comparative statements of the rates of wages in the United States and in foreign countries, was that given by the manufacturers of cotton thread, which, owing to the fact that they have similar manufactories in each country, and are paying persons working on the same kind of machinery, from information obtained from the counting-houses of two establishments with the same system of book- keeping and covering the same period of time, it may appear upon the face to be very reliable. But when the two locations are taken into consideration, part of the force is destroyed and the whole statement should be qualified on account of the isolated condition of the Paisley manufactories. It must be borne in mind that the Scotch mills draw largely from the country population where there is an excess of females, and their wages- are low, but that when the owners came here they fdanted their facto- ries in large metropolitan centers, like Providence, R. I., and Newark,. N. J.,aud they have to compete in getting their labor (for this nice grade of work in spinning and twisting) with factories that are going into sim- pler work. With us it is a different case. Their statement is truthful enough on the face of it, but it would be unsafe to draw any general conclusions as to the relative cost of labor at hoin6 and abroad from this statement, which applies so particularly to the case it describes. “The fortuitous dispute of an English labor trouble” enabled one wit- ness to present a valuable table in regard to the average earnings for three months for each man engaged in fifteen potteries in England com- pared with the earnings of a similar number of potters at Trenton, N. J. The result of this inquiry (complete tables of which will be found in the testimony) shows that the manufacturers of pottery in the United States were paying a little more than 113 per cent, above the rate paid in Eng- land for the same work. Statistics were presented at Cleveland to show the disparity between the wages paid and the labor cost in this country and abroad in some manufactures of iron, as follows: Classes of labor. England. Pittsburgh. Puddling per ton. . Shingling do Polling in pnddle mill do Rolling and heating, 1 in. x No. 18, hoop do Common labor .• per day. . $1 94 29 29 1 80 56 to 72| $5 50 77 68J 4 80 1 80 to $1 50 It is also shown that while the cost of English and Scotch iron, with- out duty, laid down on the wharf at New York, is $14 to $1G a ton, in- cluding freight, the average cost of labor alone in the manufacture of a ton of charcoal pig iron in this country, as gathered from nineteen re- ports from that number of owners of charcoal furnaces in the United States, was $16.68, divided as follows: Labor in ore, per ton of metal $3 30 Labor in limestone, per ton of metal 35- Labor in transportation and handling to the furnace 1 60 Labor for charcoal 7 40 Labor in smelting 2 35 Labor in transportation and handling of pig iron to nearest market 1 70 Total 16 68 Mr. Marshall, of the Montague Paper Company, Massachusetts, stated that in England machine-tenders were paid in July, 1882, $9 to $10 per 112 REPORT OF THE TARIFF COMMISSION. week $ that girls were at work doing tbe labor we employ men to do, the girls doing for 10 shillings, or $2.40 per week, what we pay men $9 to $10 per week for, and that rag-room and finishing-room girls receive in England $2.50 per week, while our girl help received $5 to $7 per week for the same kind of work. Mr. Stowell stated that rag-engineers re- ceived in England $4.50 per week, and here he paid them $13.50 per week. The following table was submitted to the Commission at Saint Louis, and shows the amount paid per month, in francs, to workmen in glass manufactories: Department. si . o s 'bi W 7; O) C3 m p Casting department : Founders 225 253 500 Skimmers and teamers 150 196 400 Casters 90 135 200 Kiln flrers 95 135 227 Producer flrers 110 140 250 Grinding department : No. 1 135 169 375 325 No. 2 100 146 118 No. 3 80 250 Boys 20 26 100 Smoothing department: No. 1 | 135 169 350 No. 2 100 146 300 No. 3 80 118 250 Boys - 20 34 90 Polishing department : No. 1.. 160 196 400 No. 2 125 157 300 Bovs 20 54 125 Cutting room : Chief 130 196 500 Assistants 120 J 69 375 Blockers 70 118 160 Packers ....... ............ ........ 65 135 250 Emery washer. ......... ........... ... ........ 120 225 400 Crocus burner 120 169 375 Laborers - 55 98- 150 Bricklayers 195 198 500 Carpenters 165 198 325 t The Silk Association showed that they paid their operatives, in addi- tion to receiving less work from them, about 100 per cent, more than the same class of work jieople receives in England ; over 200 per cent, more than in France ; over 300 per cent, more than in Italy, and a still greater percentage than is paid in Germany, as follows : United States. England. . France. Italy. Germany. A female hard- silk winder receives $5 25 5 18 5 00 5 57 5 98 8 00 10 00 8 44 14 15 11 43 7 94 15 00 12 00 9 00 24 71 5 30 12 77 $2 96 $1 40 2 45 2 00 A female hard-silk doubler receives A female spinner receives $1 44 2 10 A male spinner receives A male hard-silk twister receives 3 42 2 00 2 40 3 00 5 40 A female soft-silk winder receives A female warper receives A female weaver, hand-looms, receives 2 28 4 80 $2 72 3 93 3 00 A male weaver, hand-looms, receives A null e weaver, power-looms, receives 5 40 4 38 A female weaver, power-looms, receives A weaver in best ribbons receives 9 60 6 00 (*) A male weaver in dress goods receives 2 73 1 66 A female weaver in dress goods receives A male designer receives .... ..... .. 12 00 A female fringe-maker receives 1 43 3 30 A dyer receives 7 00 Switzerland, $4.50. REPORT OF THE TARIFF COMMISSION. 113 The above comprises all the facts brought out by the testimony on the wage question. A few statements showing the rates of wages paid by the iron ore producers were presented to the Commission after the testimony had closed, and were considered worthy of publication in the appendix, with some statistical exhibits furnished by Special Agent Joseph D. Weeks, who has charge of the labor statistics for the Census Office; also some tables of Carroll D. Wright’s, and, for comparative purposes, a series of tables furnished by Mr. Robert Giffen, chief of the statistical department of the Board of Trade, London, England. This w T as all the information that the Commission thought worthy of publication, and both in the case of Mr. Giffen’s figures and those of Mr. Weeks, the years 1877, 1878, and 1879 are taken. In 1874 Mr. Young, then chief of the Bureau of Statistics, iniblislied a useful volume which he called “Labor in Europe,” and in which he attempted to give not only the wage quotations at home and abroad, but also the prices of commodities. The book is valuable in regard to wage quotations; but when he comes down to the cost of living he bases his results on too small data. Laudable attempts have been made by the State Department to fur- nish information in this line, and in 1878, under Secretary Evarts, a pam- phlet was issued entitled “State of Labor in Europe.” The data for this volume was obtained from the consuls. Some of them took great pains to prepare their returns carefully, while others sent statements of little or no value. The most valuable work that has been done in this line in the United States is that accomplished by the bureau of statistics of Massachusetts, and that now in course of preparation by Mr. Weeks. The bureau of statistics of Massachusetts never publishes statements of wages except as taken from the books of the counting-rooms of the concerns, and involving thousands of operatives. They never publish wages as given to a few persons, or for one part of the State. The advantage of this method, is that if errors occur in any one place, the wide range of in- quiry acts as a check. This is true of the work being conducted by Mr. Weeks, who employed very careful men and sent them to the counting- rooms, and wherever the proprietors could give the wages for a series of years comparisons were made. No such work as this was ever done in England, or, with the exception of the State of Massachusetts, in this country, until it was inaugurated by the superintendent of the tenth census. From the tables which the Commission publishes in the Appendix, as taken from the reports of Mr. Giffen for Great Britain, and those from Mr. Wright’s forthcoming report on the factory system, and those of Mr. Weeks, the Commission draws the general conclusion that in some divisions of cotton manufactures and textile labor the wages in Amer- ica do not greatly exceed those in England, while in other subdivisions they will ran ge — like spin ning, for instance — from 30 to 40 per cent, greater in this country than in Great Britain. As shown, in Paisley, under ex- ceptional circumstances, the difference reaches 113 per cent. These facts demonstrate the absolute folly of undertaking to compare the wages of Great Britain with the wages in this country on the basis of percentages. An examination of the exhibits of Mr. Giffen and Mr. Weeks shows that both in the earthenware and glassware and iron industries the percentage of difference often reaches 100 per cent., and in some cases even more. This, in a less degree, is true in all the building trades, judging from the exhibits of Mr. Giffen, and the general knowledge of H. Mis. 6 8 114 REPORT OF THE TARIFF COMMISSION. the Commission, as no similar tables for the United States were obtainable. The last Congress appointed a committee of its own members to examine into and report upon the subject of wages at home and abroad. This may result in some valuable additions to the statistical information on the subject, and it is to be hoped that, as the wage question so vitally affects the tariff legislation, an effort will be made on the part of Congress to pursue this inquiry still further. The following tables of the wages paid operatives in some of the principal industries in Great Britain were furnished by Mr. Robert Giffen, chief of the statistical department of the board of trade. They are for 1877 and 1878. It is to be regretted that the figures for 1880 or 1881 could not be obtained; but Mr. Giffen assures the Com- mission that wages in England have practically undergone no change since that time : IRON MANUFACTURES. BAR ROLLING. Hours of labor, 66 in Darlington district and 50 in Xortli Staffordshire district. Occupation. Rollers and bloomers * Rollers and bloomer's helpers* Rurnace-men* C utter s-down* .. Heavers-on or hookers Heavers-on or hookers Catchers Straighteners Bolter-down or rougher Coal-wheelers Chargers Pullers-out Bogie-men Saw-man Roll-turners Assistant turners Ash-wheelers Laborers Laborers .SP 8 * men . . j $ .lads and boys.. men . do ... ! do. . . lads and boys. men. . do.. . ..do . do . . . do. . . do. . . do . . . do. .. do do. . . do. . . do . . . .lads and boys.. 92 23 36 35 , 68 45 01 or 36 90 12 2 9 7 6 2 6 6 9 4 4 4 5 35 7 00 6 20 4 98 4 26 II SJ $10 34 8 51 4 86 2 43 3 65 5 41 6 08 3 95 3 34 4 46 5 47 7 78 4 46 3 65 Piece work. REPORT OF THE TARIPF COMMISSION. 115 Iron manufactures —Continued. PUDDLING. Occupation. Puddlers* Puddlers’ underhands Shinglers or hammermen* Shinglers’ helpers Rollers* Forge managers, first grade. .. Forge managers, second grade Stock takers Stock takers Ash and coal wheelers Cinder burners Coal-unloaders Bar drawers Metal breakers and wheelers . Bogie-boys Hammer-drivers Roll-turners Laborers Laborers * Piece work. Darlington. North Stafford- shire. Hours per week. $8 02 $8 14 55 4 14 55 12 20 8 51 55 8 27 4 26 55 13 16 ! 8 51 55 . .do 8 75 55 . . do 6 56 55 5 10 7 29 60 . boys. . 2 33 60 4 38 4 46 60 6 28 4 74 60 4 62 3 95 60 ..do... 1 6 56 6 80 55 . . do . . . 5 83 6 56 55 hoys . . 3 28 2 43 55 3 89 3 65 60 ..do...; 6 20 7 78 55 ..do...! 3 65 3 65 60 boys.. 1 1 62 60 IRON MANUFACTURES IN ENGLAND. l BLAST FURNACE. Hours of labor in Cleveland and Darlington districts, 12 per dag, compensation given bg the dag in Cleveland district and bg the week in Darlington district ; and in North Staffordshire district 63 per week , compensation given bg the week. Keepers Keepers, helpers Chargers Chargers, helpers Slaggers Mine fillers Time fillers Coke fillers — Metal carriers — Rnginemen ...... Weigh man Masons Fitters Smiths •Joiners Boilermen Laborers Apprentices I a t O o men. . do... do... do... do. . . do... do. . . 5 © r=> 03 >> ® 0 ® oi H O 0 $5 95 $6 32 $5 59 $5 34 5 95 4 62 6 08 6 08 6 08 5 83 6 08 7 29 6 56 4 38 5 83 6 08 6 56 4 14 6 08 2 68 3 16 2 92 2 68 8 98 5 83 9 72 9 72 5 34 5 83 5 75 3 16 3 16 6 56 6 32 9 60 9 72 6 32 5 83 5 83 8 50 7 04 7 29 8 50 5 34 5 83 5 59 9 72 5 83 5 34 5 10 4 38 WORSTED MANUFACTURE IN ENGLAND. HOURS OF LABOR, 56 PER WEEK. Wool sorters $7 53 to $8 02 Machine wool-combers do 3 89 to 4 25 Dyers 4 38 to 6 32 Overlookers 7 04 to 8 26 Overlookers’ assistants do.... 2 43 to 5 10 Spinners 2 19 to 2 68 Spinners 2 43 to 2 68 Spinners girls... 97 to 1 46 Weavers 4 38 to 5 34 Weavers 3 41 to 4 14 Reelers 2 92 to 4 14 Drawers 2 43 to 2 68 Packers 4 62 to 5 10 Wool washers 4 14 to 4 62 WAGES PER DAY IN A BLACKBURN COTTON-SPINNING MILL. HOURS OF LABOR, 56 PER WEEK. Spinning Shinners Piecers Creelers Rovers P lubbers Drawers Grinders Blow-room hands Engine drivers Fireman $1 20 to $2 00 1 20 to 1 40 46 to 56 28 to 34 58 to 66 50 to 60 52 to 56 85 to 48 to 85 84 to 2 00 64 to 84 WAGES PER DAY IN AN OLDHAM COTTON-SPINNING MILL. HOURS OF LABOR, 56 PER WEEK. Mule overlookers $1 60 to #2 00 •Carders 1 60 to 2 00 Strippers 88 to 96 Jobbers 88 to 96 Grinders 88 to 96 Drawing and stubbing hands * 65 to 76 Intermediates and roving 62 to 76 Little tenders (full time) 36 Little tenders (half time) 16 118 REPORT OF THE TARIFF COMMISSION. WAGES PER DAY IN AN EAST LANCASHIRE COTTON-WEAVING MILL. HOURS OF LABOR, 56 PER WEEK. Weavers, 3 looms $0 64 to $0 72- Weavers, 4 looms 80 to 96- Weavers, 6 looms 1 20 to 1 44 Weavers, children, half-timers 14 Beamers or warpers .. ... 70 to .90 Winders 50 to 80 Tapers or sizers 1 20 to 1 68 Tacklers or overlookers 1 12 to 1 68 Engine drivers and fireman 96 to 1 68 HOSIERY MANUFACTURE, LEICESTER AND NEIGHBORHOOD. HOURS OF LABOR, 56 PER WEEK — PLAIN, FANCY. Wide frames (hand) men . . Wide frames (power) do*... Circular frames (power) women. . Winding machine (power) do Winding machine (power) men.. Winders (hand) do . . . Sewing machines (power) women.. Seamers (done at home) do Menders do $7 29 to $7 77 7 29 to 7 29' 2 92 to 4 62 3 65 to 3 41 3 65 to 3 90 1 95 to 1 95 2 55 to 2 55 1 95 to 1 95 3 65 to 2 92 LINEN AND FLAX MANUFACTURE IN IRELAND. HOURS OF LABOR, 56 TO 60 PER WEEK. Spinning : Roughers and hecklers Sorters Machine hoys Time spreaders Tow carders Drawers Back winders Rovers Tayers Spinners Piecers Doffers Reelers Overlookers Laborers Mechanics Weaving : Tenters Dressers Weavers Pern or weft winders Spool or warp winders Warpers Drawers in Givers in i Winding masters Cloth passers Cloth tappers Cloth pickers Oilers Mechanics Laborers Bleaching : Bleachers Bleachers Washmill men Iveevemen Fieldman men.. $4 86 do 5 83* boys.. 1 46 . . , women.. 1 70 do. . . 1 76 do... 182 do . . 1 52 do... 1 58 do... 1 70 do — 1 95 do... 1 82 do... 1 34 do... 8 89 1 men.. 8 51 do... 2 92 do . . 8 02 men. . 9 24 do. .. 8 28 women . . 2 80 do... 2 19 do... 2 19 do... 2 92. do... 2 43 girls.. 61 men . . 4 86 do 6 32 do .. 2 92 do... 219 do... 1 95 do... 8 02 do... 292 men.. 5 TO lads and boys.. 1 95 men.. 5 82 do 5 58 do... 5 10 R k PORT OF THE TARIFF COMMISSION. 119 Bleaching : Eugineman... Sewers Store finishers Calenders Bluers. lads and boys. . women .. do. . . men . . do... JUTE MANUFACTURE IN DUNDEE. Spinning : Preparers for spinning Preparers for spinning Spinners Spinners Spinners Twisters Reelers Reelers Reelers Overlookers Laborers Weaving: Winders Warpers Beamers Weavers Weavers Overseers Tenters HOURS OF LABOR, 56 PER WEEK. lads and boys. . women .. do . . . lads and boys. . girls . women . . do. .. lads and boys.. girls . . men . . do . . . women . . do v . men. . women.. girls.. men. . do... LACE MANUFACTURE AT NOTTINGHAM AND NEIGHBORHOOD. $5 82 1 95' 1 70 4 86 3 89 $1 95 2 19 2 55 1 82 1 82 2 80 2 92 1 95 1 34 6 44 3 77 2 86 3 16 5 32 2 80 1 95 5 93 5 82 HOURS NOT GIVEN. Piece-work : Lace Lace-makers Winders Menders Treaders Warpers Designers and draughtsmen Curtain and other classes: Makers For cotton For silk Winders, silk Winders, cotton Menders Treaders, cotton Treaders, silk Warpers Designers and draughtsmen Plain net: Makers, cotton Makers, silk $6 08 to ; £19 44 .. men. . 2 19 to 2 43 .boys. . 4 19 to 2 68 2 19 to 2 68 1 22 to 2 19 4 86 to 7 29 ..do... 9 72 to 23 30 men. .. 7 29 to 19 44 . . do . . . 6 08 to 9 72 ..do... 7 29 to 10 95 .boys.. 2 43 to 3 65 ..do... 1 95 to 2 92 .girls.. 1 95 to 3 89 .boys.. l 46 to 2 43 2 43 to 3 41 7 29 to 9 72 ..do... 14 59 to 29 16 4 86 to 9 62 7 29 to 10 95 EARTHEN AND PORCELAIN MANUFACTURE IN ENGLAND. Clay makers Throwers. . . Throwers . . . Turners Turners Handlers Handlers Earthen- Porce- ware. lain. $4 86 to $7 29 8 02 10 20 2 92 2 92 6 32 to 7 77 2 92 2 92 6 56 to 6 80 2 92 2 92 120 REPORT OF THE TARIFF COMMISSION. Molders . Burnishers Earthen- Porce- ware. lain. . . . men . . $6 80 to $9 72 2 43 2 43 9 72 to 19 44 6 32 to 9 72 2 68 .. . . men . . 7 04 to 9 72 8 74 10 68 ....do... 6 32 7 29 5 83 .. women . . 2 43 .. 1 46 1 46 10 68 to 10 95 do. .. 6 32 9 72 women.. 3 16 3 89 1 22 1 22 . . . men.. 7 53 9 72 . . . boys . . 1 95 2 19 men.. 10 44 9 72 women.. 2 68 2 48 ...girls.. 1 22 1 10 . . . men . . 4 38 .. ... .do... 6 08 to 7 77 . . .boys. . 1 82 1 58 7 29 .. GLASS MANUFACTURE. PIECEWORK. Glass manufacture: Workmen and blowers Serirters and finishers Pot makers Lads and boys — (flass cutting: Glass cutters men. Glass cutters lads and boys . Teazers men. Packers .. -do Birming- Sunder- ham land bottles. bottles. $13 14 S5 83 9 48 6 80 6 56 7 77 1 95 2 07 6 25 75 7 77 5 43 5 59 4 86 BUILDING TRADES— GREAT BRITAIN. HOURS FROM 47 TO 56 PER WEEK. [This table gives compensation per hour.] Foremen Boys and lads Bricklayers Boys and lads Masons Boys and lads House carpenters Plasterers Boys a: Slaters Painters Boys and lads . . Plumbers Boys and lads . Glaziers Boj t s and lads . . Smiths 0 s q l £ ! O § O o a 'o ® fl 19 08 06 (*) 18 05 1 04 16 m 17 15 18 (*> 18 06 05 (*) 16£ 05 04 15 18 16 14 16 (*) 08 05 ! (*) 05 034 18 15 18 16 18 16 18 (*> 18 05 (*> 18 05 04 15 17 15 13 17 ! (*) 17 1 07 H 15 04 034 13 05 j 16 I 14 13 i (*) 15 ! 04 1 (*) 04 03.V 20 16 | 17 ' 15 17 13 15 (*) 15 04 ! (*) 04 02J 17 (*) 18 17 15 1 17 13 15 04 (*) 04 024 14 13 | 15 ; 13 1 (*) 1 05 ! (*) 1 03*1 024 Wages vary; hoys generally commence when 13 years of age at 4 cents per hour, and gradually rise until they icach the general rate. REPORT OF THE TARIFF COMMISSION. 121 Building trades — Great Britain — Continued. London. Northampton. Bolton. Bradford. Liverpool. Aberdeen. Darlington. 'G-as-fitters $0 18 $0 17 $0 13 $0 15 Boys and lads (*) 04 04 02! Bell-hanger 18 13 13 13 Boys and lads (*) 05 03 02| Paper-hangers 17 16 $014 13 13 Boys and lads (*) 05 (*) 03 02! Laborers (when scaffolding or hoisting) 13 $0 12 13 09! 12! Boys and lads (*) 05 Joiners 18 15 18 16 $0 16J 14 16- Boys and lads (*) 08 05 04 (*) 05 03! Laborers (generally) 11| 09 12 12 11 08 Boys and lads (*) 07 (*) 04 * Wages vary; boys generally commence when 13 years of age at 4 cents per hour, and gradually rise until they reach the general rate. The following tables, which were furnished at the request of one of the Commissioners, did not reach the Commission in time to be put in the testimony, and are therefore made part of the appendix: AVERAGE WAGES OF MEN WORKING FOR GLENDON IRON COMPANY TO NOVEMBER 1, 1882. TEN MONTHS. MORRIS COUNTY, NEW JERSEY. Per day. Contracting miners (in drifts and sinks, &c.) $2 00 Miners and laborers 1 50 Engineers 2 00 Blacksmiths 2 25 Carpenters 2 25 Masons 2 75 AVERAGE WAGES OF MEN WORKING IN THE NEW JERSEY MINES. Per day. Machinists $2 50 C bargemen 2 00 Blacksmiths 2 00 Engineer 1 75 Drill-reamer 1 75 Miner 1 50 Numerical classification of men employed in the Chateaugay mines for the months of July , August, and September, 1882. Month. j No. Rate. Month. No. Rate. Month. No. Rate. $2 10 1 60 1 35 1 50 to 2 00 1 25 1 85 1 60 1 72! 1 47! 1 10 3 00 July. August. September. Foreman Strikers Wallopers Laborers, ordinary J Machine men Machine helpers Drill sharpeners Assistants Drill boys Teams 20 190 I 136 : 180 17 59 37 15 22 23 10 2 1 20 15 58 $2 10 1 60 1 35 1 50 to 2 00 1 40 1 85 1 60 1 72J 1 47! 1 10 3 00 2 00 1 00 1 60 1 47! 1 47! Foreman Strikers Wallopers Ordinary laborers j Machine men Machine helpers. . . Drill sharpeners . . . Assistants Drill boys Teams 25 218 142 139 6 61 45 16 21 26 9 $2 10 1 60 1 35 1 50 to 2 00 1 25 1 85 1 60 1 72! 1 47! 1 10 3 00 Foreman Strikers Wallopers Ordinary laborers -j Machine men Machine helpers . . . Drill sharpeners . Assistants Drill boys Teams 29 223 205 151 6 71 48 16 19 28 7 Do Do Do Do Do .. Do... Engineers Firemen Dump men Engineers Firemen Dump men 17 23 1 60 1 47! 1 47! Engineers Firemen Dump men 15 18 73 1 60 1 47! 1 47! 122 REPORT OF THE TARIFF COMMISSION. LAKE SUPERIOR IRON COMPANY. ISHPEMING, MICH. Statement of labor employed, month of October. l l l l l l l 1 2 1 1 23 40 40 34 14 4 13 12 8 26 1L 67 16 11 9 20 10 30 6 18 17 2 11 10 5 4 6 1 2 1 1 1 1 3 4 4 8 67 9 4 1 1 1 4 3 2 18 1 1 1 1 12 8 10 10 1 1 49 s Class of labor. S ^ W -*-> <© a CJC o a a ® § M® F $65 00 $0 75 60*00 1 75 150 00 100 00 125 00 65 00 2 50 2 25 1 90 2 05 1 75 j 2 75 2 50 2 43 2 40 2 34 2 16 | 2 10 1 76 , ( 1 90 1 t0 ( 2 00 2 07 2 10 2 00 2 08 2 08 2 18 2 19 2 20 2 21 2 22 2 25 2 27 2 40 2 55 2 87 3 09 do I do do l Miners (average) do do do do do do _• do do do .. do ! . . . do do do do do Rope splicer 65 00 Ore weigher 1 45 2 25 1 60 2 25 2 00 1 80 1 60 2 00 1 70 1 75 1 60 1 50 1 45 1 25 1 00 ; Ore inspector do | Torch repairer do * do 1 do... Surface men Surface men do do do do do do Pumpman 70 00 do 2 00 1 1 75 | 1 70 2 25 2 75 2 00 do do Carpenters (average) Painter do i Blacksmith 70 00 do 2 75 ' 2 25 j 1 65 2 00 2 23 ! 3 00 2 00 1 80 .. .. do Blacksmith helpers Machinists Diamond drill men Boiler-shop .. do Engineer 1 REPORT OF THE TARIFF COMMISSION 123 ; Lake Superior Iron Company — Continued. & 2 3 'A • Class of labor. u & . It £ k 1 1- SS I $1 spg ; E 1 £ 1 Barn boss $65 00 .. 4 Barn men $1 67 18 Teamsters 1 65 10 Hired teams 2 33 1 Mason 3 ro 4 do 3 25 7 do 3 00 11 Mason helpers 1 50 5 Tipfinet first five • not inolnfied Men employed, 788. Average wages per day, not including salaries of agents, gen- eral manager, the surface superintendent, and book-keeper and paymaster. Amount of pay-roll fdr month of October $42, 792 70- Mi ning supplies 3,849 37 46,642 Ki Add salary of agent and general manager, surface superintendent, book-keeper and paymaster, tools, wagon-car, hay and grain, insurance, taxes, fuel for engines, repairs., special repairs, railroad freights, lake freights, marine insurance, commission on sales. Mining contractors mining ore by the ton, brought forward during drifts and sink- ing winzes and shafts by the foot : Average number employed, 105. Average wages per day, $2.85. Fillers, breaking ore and rock, and filling into cars in the mine, paid by the ton: Average number employed, 61. Average wages per day, $1.97. Miscellaneous labor, being men on surface, cage-tenders, brakemeu, pocket, incline? men, &c. : Average number employed, 115. Average wages per day, $1.56. Number employed, not including office, 611. Average daily wages, $205.50. The above is the force regularly employed in the production of ore. There is, in addition to this, a considerable number of men employed temporarily on new work,., such as new engine-houses, buildings, &c., and loading stock, piles; but above state- ment is sufficient for comparison of wages of the regular working force of the mines.. Republic, Mich., November 20, 1882. Statement of average wages paid by Republic Iron Company. Blacksmiths: Foreman, per month, $85. Smiths, $2.50, $2.40, $2.35 per day. Drill-sharpeners, $2.50 per day. Helpers, $1.60 and $1.70 per day. Average number employed, 21. Average wages per day, $2. Carpenters : Foreman, $70 per month. Carpenters, $2 and $2.25 per day. Average number employed, 14. Average wages per day, $2.08. Teamsters : Double team, $1.70 per day. Switching, one mule or horse, $1.15. Average number employed, 24. Average wages, $1.32. 124 REPORT OF THE TARIFF COMMISSION. Engineers and drum-men : Foreman, $125 per month. Engineers, $2 per day. Drums, $1.80, $1.70. Small portable hoisting engines, run by air, $1.60, $1.50, $1.40. Average number employed, 43. Average wages, $1.83. Blasters: Per month, $75, $72.50, and $70. Average number employed, 3. Average wages per day, $2.79. Machine-shop : Machinists, $3, $2.50, $2.25. Helpers, $2 and $1 per day. Average number employed, 5. Average wages per day, $2.12. Firemen : $1.75 per day. Average number employed, 7. Average wages per day, $1.75. Timbermen : Foremen, $78 per month. Men, $2, $1.90, $1.70. Average number employed, 17. Average, $2. Drilling-machines : Runner, $2.25 per day. Helper, $2 per day. Average number employed, 41. Average wages per day, $2.12. Pit bosses: $2.50 per day. Average number employed, 1G. Miners, $2.25, $2.10, and $2 per day. Average number employed, 139. Average wages per day, $2.04. REPORT OF THE TARIFF COMMISSION. 125 126 REPORT OF THE TARIFF COMMISSION. 2 r 5 = SS 2 ei Zl -si S' 2 K 2 e V . 8,1 ...2 2 ff .2 ~ s !■§ § 55 ^ « S s' s ^ ~ ss o e S - e -2 •51 1 C 1 1 =5* =>. s "fe S’? 5 S', c 8 - s s C>£ to 111 S sT^ -5 §<;o J§ ©s'® 4 - .2 1'S.s © Jr x § I’i 1^1 Hi 1 i P-Ot o h Ph ; mill iiigli ^^S8“SS“ \mm is's^ss , CO t > co io co * llsiSI §3§Wf I si S§g§SfS ] pSlila ?3"ssaes jssssad' fX,^ 1 CO r-t ^slssll Islllfl i-T co in Th co i n £13388 bills'! \ ao oo no co a> *o c- oo 00 JO 00 Statement showing the imports, by countries, of wool (sheep's ) and hair of the alpaca, goat, and other like animals, during the fiscal years 1876 to 1881, both inclusive. REFORT OF THE TARIFF COMMISSION 127 gllssSl O Cl ^ fO WplOO |g?§3|S'!'2 ' C) vf r-T io" of — r co^ to 1 “sIsSS! ssss g’Sggljj ^8 CO ^ llliiilllliil ! rf of rj<' t-“ CO lO ; L 'SS"3" S ^IlslSSlIlIs ! 1 1 pi f a "" i'""'"" f'l t* fff Cg CO i is CO 1111 ci to gllllg ?“l£gS'8 CO- «s lies 1 tmm '■* ! l£5Sf8''g" of _ ^isgsis !?>W plsll*!! -•§- ■sglill-Sl tSS w- ' "S Is 1 II Is i* 11 IS Is II Tfr-r II gfs“ £3 ggf IS II II If SS II 1 1 i |5 !li _ a g|?ll£fS8f1| o< 23 £ o O M Pl, X 02 H < I ISSil •r-T SIS1! 1 SW * sill! iSi'F rH r-T sis!! 1 IsllS g“l¥ sill! 1111 s ' isssa s s se" alsll fiis s ‘ Ills! aoNr-oort I mil i slW s' 00 of of pill i ISis s (N H 1C (M »G CO ASSESS"®" ^ COC5WI- . 3 : *s : :! i j § *e 1 1 i ill : s 2 ; E <5 : •’C'g • 3 . p, • w 3 "o ,d ■ 11 ills ,a 13 0 ^ ! II j H mm 3 0 H £ a- s $ 2 a 8 •;,i & i rt (- Total South America 12,295,095 1,655,698 j 14,556,554 jl, 843, 360 j 18,439,658 j 2, 363, 405 12,087,042 1,329,281 | 26,227,260 3,738,175 j 13,530,996 2, 184, 81 1 ■Statement, showing the imports , by countries, of wool { sheeps ) and hair of the alpaca, goat, and other animals , S 4IISS ISllI I gisSS 1 « 3 gfB 3 s i § I mM gsa§s .$£118 |1!1S fts Cl" CO "ssiis »ils! fill ^ N« 'sr -SsSI Ili'P i Ps retty high we will erect works and manufacture some of the dyes here ourselves. If the duty is taken off', this branch of industry will remain as it is at present. Q. I would like to ask you as to the aniline dyes that are made in this country — whether their quality is good and whether you are limited to one color? — A. There are three colors made in this country. One is magenta , the raw material for which is imported from England. It is manufactured here and sold at a fair price, but the quality is not such as to enable it to compete with the imported article. The firm which manufactures it is located at Albany, N. Y. Ido not think they employ more than about forty men altogether. There are three other concerns, employing a dozen men. That is the extent of the manufac- ture at present. They do not compete with the foreign goods at all. Q. What amount of these goods are used by the different manufact- urers of colored prints, for example ; 1 mean of these aniline dyes ? — A. 156 TARIFF COMMISSION. [ JOHN CAMPBELL. I cannot tell you exactly tlie amount the different manufacturers consume, but the quantities imported last year were about 1,200,000 pounds, pay- ing a duty of $1,200,000. These dyes take the place of almost every color. Cochineal has been generally used for dyeing woolen goods, but wool scarlet is used as a substitute for cochineal , which comes in free, while this has to pay 135 per cent. duty. They replace also archill and other barks, woods, and extracts used for coloring purposes. This whole trade is yet in its infancy. The blue article that 1 introduced into this country enters into the manufacture of all the paper used by the New York dailies. It sold then at $4 a pound, and it took the place of ultra marine. All the paper-makers use it. Among the consumers of aniline dyes I might mention the following : All woolen manufacturers, who use it in the manufacture of bed-blankets, horse-blankets, carpets, shirts and drawers, flannels, hosiery, domestic woolen yarns, worsted piece goods, merinos, ladies’ opera flannels, wool hats, overcoatings, &c. It is also used in the manufacture of dress goods, both woolen and cot- ton; ginghams, prints, and cotton yarns. It is also used in all classes of paper manufacture, not only for newspapers, but for paper used for wrapping purposes, for posters, envelopes, and wall paper; also in the manufacture of straw hats, willow and wicker work, leather for chair covers, and for printing inks, especially by all label press printers, and by matchmakers and jute-carpet manufacturers. HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 157 HENRY F. FRENCH. Long Branch, N. J., Wednesday , July 2(3, 1882. Hon. Henry F. French, Assistant Secretary of the Treasury, ap- peared before the Commission, in response to its invitation, and made tin* following statement : The invitation, Mr. President and Gentlemen of the Commission, which you were kind enough to send me, was so general in its character that I really had no idea what was wanted of me, excepting from the suggestion which came in the telegram, that you wished to advise with me upon the general subject of the customs revenue. Being a some- what old lawyer, as my friend the president can testify, I made a little brief which would guide me and keep me from running away from my subject, upon the importance of simplicity in the arrangement of the tariff; simplicity in the classification, especially with a view to avoid- ing ambiguities of all kinds. A gentleman came into my office not loug since, who was interested in tariff matters, and said he thought it would be an excellent thing to have somebody rewrite the tariff list and make everything plain, so that everybody would understand it alike. That would be an excellent thing to do, but I believe nobody has ever succeeded iu writing any law so plainly but that we needed a pretty large judiciary force to interpret it. And when we consider that the whole judiciary of the world is engaged in the business of the construc- tion of doubtful laws, the importance of making things as plain as pos- sible is apparent. The jurisdiction of the Secretary of the Treasury relates, especially as it is connected with the customs laws, to the matter of classification, and I suppose most of you — all of you who have had any occasion to be concerned with the examination of the tariff law — know what classifi- cation means. The duties of the customs officers are essentially two, the classification of goods and the valuation of goods ; the determina- tion of the particular class under which they are to be assessed, and the appraisal of them with a view to determining their actual value. The classification of goods in the custom-house belongs to the col- lector. By the theory of the law, the collector determines to what class the goods belong, whether iron or steel, whether cotton or w r ool, whether under one particular specification of those articles or another. The valuation of them — the fixing of the price when the class has been ascertained — belongs to the appraiser. The classification is usually made in the appraiser’s office primarily. The appraisers report to the collector what class they understand the goods to belong to, and the collector, not knowing as much of the details as the appraisers, usually accepts their classification, and if the classification is wrong, an appeal goes to the Secretary of the Treasury from the opinion of the collector. The way that is done is this. In the first place a protest is filed with the collector after he classifies the goods. That merely states in a gen- eral way that the importer is dissatisfied with the classification, stating also how the goods have been classified, and how he claims they should be classified. That protest goes to the collector, and we of late have held (what does not seem to have been held before) that upon receiving 158 TARIFF COMMISSION. [HENRY F. FRENCH. that protest, the collector’s duty is to re-examine to see whether he has made tbe mistake which is suggested, and we hope in Yew York in particular that a great many suits will be saved by that second exami- nation. If the collector persists in the classification which he has made, and the importer is dissatisfied, the importer appeals to the Secretary of the Treasury. The papers come to the department addressed to the Secre- tary. They go to what is called the mail -room, which is a kind of docket-room, where all letters sent to the department first go, and are entered on the books. They are then referred to the customs division of the Secretary’s office. The customs division is under my general supervision as Assistant Secretary, the business of the Secretary’s office being divided between two assistants. I have perhaps eight or ten different classes of duties, and among them all matters relating to customs. If it is a mere question of routine, or a question which has been set- tled over and over again, as most of the cases are, the customs division prepares a letter for my signature without any consultation. If, on the other hand, it is a doubtful matter, and a matter which deserves special consideration, the head of that division calls on me, and w e have, in ad- vance of the preparation of any letter, a consultation upon the point ; and if we consider it pretty clear, the letter is prepared lor my signature and sent. If it is a matter that has assumed great importance, as hoop-iron, for instance, I go to the Secretary about it and ask his consideration of it, generally giving him my own impressions. If he is not clear, and thinks proper, he will call on the Solicitor or the Attorney-General for an opinion. Having formed that opinion upon such advice as he gets, he de- cides upon the appeal, whether he will confirm the decision of the col- lector or whether he w ill in any way modify or change it. If he affirms the decision, it stands, unless the importer within a certain time brings a suit in the court. Then the question goes to the court and jury. Per- haps two or three years after the question has arisen in the custom-house it gets to a court and jury. There are no samples thereby which anybody can judge what the goods are, and probably there is nobody on the jury who ever tried such a case, or who can have any possible knowledge about it. The judges in Yew York are skillful, in other places not so experi- enced, and the result is often quite different upon the law and the facts in the different jurisdictions. In Yew r Orleans we get one decision on the classification of an article claiming to be cotton ties. In Yew York or somewdiere else we get a different decision, the court all the time in- structing the jury rightfully that if this is a manufacture of iron — the completed article ready for use — it pays 35 per cent. duty. If it is not a manufactured article in the sense in which the court explains the mat- ter, then it is hoop-iron, and will pay about three times that amount of duty. And the jury, understanding the matter as well as they can, have given various verdicts on these points. We had one case in Yew Orleans w here a jury gave a verdict that the article claimed to be a manufactured article — a cotton-tie — was hoop iron. In the course of three or lour w eeks another case precisely like it came up and was laid before the jury, and in the course of the discussion, if not before the case came on lor trial, the court set aside the verdict of the first jury because they had not been correctly instructed in the law, and put both cases to the same jury, and they found the other way. If you have the “Tariff Indexed” and will follow me along, I will at- tempt to make the subject intelligible. Y"ou might think the question w hether an article is iron or steel might HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 159 be settled without any great difficulty. Yet there was a lawsuit tried within a year in Boston, which occupied six weeks, with the ablest coun- sel that could be procured, and quite an array of them’ on each side. Yotice was given to the iron and steel people at Pittsburgh, who came down in force to defend their view of the matter, which was that the article was steel, and all the experts who could be gathered together in the neighborhood of Boston, and I do not know but everywhere else, on the other side, were there, and swore that it was iron, and after great difficulty and many rulings by the court, which were excepted to, so that the losing party hopes the verdict will be set aside, the jury decided that the article was iron. The difficulties as to the duties on steel arise in this way: At the time the tariff on metals was enacted (in 1804 I believe), there was no steel, as I understand, that was not worth from 7 to 12 cents a pound. Those articles which I sometimes call brevet steel, like Bessemer steel and Martin-Siemens, were not extensively kuown at that time. The specific and ad valorem duties were no doubt intended to be similar, but the change in the value of steel makes them very unequal. At the present time crucible steel is worth 10 to 11 or perhaps 12 cents a pound, and Bessemer steel for rails is worth about 1J cents a pound. You will be able without difficulty to so arrange the duties ad valorem or otherwise that there shall not be the inconsistencies that now exist. I think it is probable, as the general idea seems to run through the tariff, that about 35 per cent, ad valorem was the duty that was conceived to be proper when that tariff was framed upon steel. You will find the duties fixed in the present tariff on steel at from 2J to 3£ cents per pound. See Tariff Indexed, 117. By Commissioner Oliver : Q. Do you mean, when the law was passed, it seemed to be the idea of the law-makers that about 35 per cent, ad valorem would be the proper rate! — A. That seemed to be the rate they put on; 35 to 45 per cent, was put on to manufactured articles. Q. There was a great difference in values at that time, was there not? — A. Yes, sir. Q. At that time gold was worth 200, so that that rate would really be 70 per cent. ? — A. Yes, sir; perhaps so. The duties were payable in gold, I suppose. Q. And the goods were sold for currency ? — A. That is probably so. It is pretty hard to bring these facts together. Commissioner Oliver. Still that makes a very great difference be- tween specific and ad valorem duties. The Witness. But what I speak of particularly is that the price of steel has so greatly fallen since that time by the introduction of new methods of manufacture of steel, that the ad valorem duty on it is very little, while the specific duty remains very high. Controversy arises as to the classification under paragraph 117; “ Steel in ingots, bars, coils, sheets, and steel wire not less than £ of one inch in diameter, valued at 7 cents per pound or less, two cents and one- fourth per pound.” If you put 35 per cent, on that, if steel was worth 7 cents a pound, you would not get anything very different from the specific duty; but you introduce steel worth only 1 J cents a pound and put 35 per cent, duty on that, and it pays very little duty, so that the controversy between the manufact- urers and the importers — those who wish to protect the importation, and those who wish to get it in at a lower rate of duty — is upon the classification, whether as ingots, bars, coils, sheets, &e., or as manufact- 160 TARIFF COMMISSION. [HENRY F. FRENCH. ured steel at 45 per cent., or as u steel in any form not otherwise provided for,’ 7 thirty per cent, ad valorem. (1)1, 120.) I now come to the hoop-iron question. The present tariff is found in paragraphs 79, and 80, as follows: “All band, hoop, and scroll iron from one-half to six inches wide, under one- eighth of an inch in thickness, and not thinner than No. 20 wire-guage, 1^ cents per pound. All band, hoop, and scroll iron thinner than No. 20 wire-guage, If cents per pound. 77 The question in regard to what are called cut hoops and cotton-ties, is whether they come under that classification or under the classification contained in paragraph 146, which is as follows : “Manufactures, articles vessels and wares not otherwise provided for of brass, iron, lead, pewter, and tin or other metal (except gold, silver, platina, copper and steel), or of which either of these metals shall be the component material of chief value, 35 per cent, ad valorem. 77 I think the duty is about three times as much by the classification of these articles as hoop iron as by their classification as a manufactured article. So that you see controversies will exist until the matter is in some way made clear. The history of this hoop-iron controversy is very in- structive. I do not undertake to say whether the Treasury Department has ruled correctly or not. As we have ruled both ways, we must be correct in one or the other instance. I can talk about the two classes, the cut hoops and cotton-ties, together, perhaps, conveniently. The cotton-tie is a piece of hoop-iron 11 feet long, -I think, either with or with- out what is called a buckle riveted to one end. It is a straight piece of iron. Some of them come with a buckle riveted on and the hoop is wrapped around the bale and the end tucked under the loop of the buckle, and that confines it. That kind of a cotton-tie, as long ago as 1867 or 1868, by a verdict of a jury in New Orleans, I think, and by the acquiesence of the Treasury Department and everybody else, was classed as a manufacture of iron at 35 per cent. Tor some reason there was not much controversy in the matter up to about ten years ago. Then the importers began to refine a little upon it. They found that really there was not any need of riveting that buckle, on. It was just exactly as good loose, because they could confine both ends as well as one. So they strung the buckles on at one end and sent the hoops up in packages of 50 with 50 buckles, one on each. Afterwards they found there was no use in stringing them on each, and they strung them together. Then the question came up whether these, not being riveted on and not cortiing under the old rule, should be classed as hoop iron. The hoop-iron people said they should pay the high rate of duty, and the cotton people insisted that the cotton- ties were manufactured articles at 35 per cent. On the question of the cotton-ties the department ruled, finally, that a cotton-tie that had not a buckle riveted on it did not come under the old decision, which was a recognized authority; that it was hoop-iron, and should bear the duty of hoop iron. And that decision stands as the decision of the de- partment, but it stands on a very slippery foundation, because there are people who contend that a cotton-tie is hoop iron, wdiether a buckle is on it or not; others contend that it is a manufactured article. The buckle is used with it; it is merely wrapped around the bale and these ends bent under and it holds. How the question would be settled, if it ever could be settled by the verdict of a jury, I cannot undertake to say. As to cut hoops, 1 do not remember their length. Commissioner Oliver. They are about six to eight feet in length. The Witness. They come in ordinarily, as I understand, with holes punched at one end for rivets, and they are put around the barrel, being HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 161 made of the righf length and the rivet put through the hole. Some of them have holes at both ends, so as to make them shorter or longer, and all that is needed is to bend them around and put rivets in them. The department ruled in the tirst place that this was hoop-iron and should pay duty as such. The case was tried three times in New York (one case, I think, or a series of cases) between the same party and the government. In one of them a verdict Avas rendered for the importer and the verdict was set aside; in the other the jury dis- agreed. In the third case the jury found for the importer that it was a manufactured article subject to the 35 per cent, ad valorem duty. That was in 1878. The question did not loom up so large as it has since loomed up. It Avas examined and sent in the ordinary way to the Attorney-General to know whether he acquiesced in the views of the court and jury ; whether that verdict should be acquiesced in or not; aud it came back with his opinion that we had better acquiesce in the decision and call it a manufactured article, and that decision was published. The importation of this article of hoops was very large. The Standard. Oil Company import a very large amount of them but under the doubt existing there are not as many imported as if the matter were clear. When that decision was made they began to order an immense amount. As to the cotton-ties, there are 30,000 tons of iron for cotton ties used in a year. It seems incredible, but it will give jou a little idea hoAv large the importation would be in cut hoops if the hoops w T ere all imported for the oil companies and other uses. They sent out immense orders, and great pressure was brought to bear on the Treasury Department by the manufacturers, who said that they could not compete with the foreign manufacturers with the. 35 per cent, ad valorem duty, and Secretary Sherman Avas induced, I think, in 1880 (I have not the exact date), to change the ruling. He remitted the matter to the Attorney-General to examine the evidence that was on tile in the trial at New York, who decided that he was not satis- fied with the result of that A^erdict and that it was proper to reA r erse that decision. Mr. Sherman sent a communication to Congress, in which he said that he Avas reconsidering the question, and that if Con- gress did not legislate on the subject before a certain date, which he named, he should reverse the decision of 1878 and declare that cut hoops bore the duty of hoop iron. Congress did not legislate within the time stated, and the Secretary reversed the decision and fixed the duty on cut hoops as upon hoop iron, and’we have many suits now pending upon the question. But the persons who imported under 'the decision of 1878, and who had made enormous importations, came at cnce to the department and to Congress and said, u Why, we Avere misled by this decision of the department and have invested our money, and our merchan- dise is on the way. We are willing to pay the duty fixed by the de- partment when Ave ordered the goods, but we are not willing to pay three times as large an amount, and will not do it.” Congress listened to their complaints and passed an act that all importations of this char- acter made after the decision of 1878, and of goods ordered to arrive before a certain date (I think prospective somewhat), should have their merchandise rated according to the decision of 1878, as a manufaeure of iron, at 35 per cent., and the refund should be made to all who had overpaid that amount in adjustment of their importations of that article and we made large refunds. I only state this in detail to show you how very important a little question of this kind becomes, and how, if it is possible, you will avoid II. Mis. 0 11 162 TARIFF COMMISSION. [HENRY f. french. (and undoubtedly you will), as to all these articles, any ambiguity or uncertainty in the future, and how important it is in general to take a course by which we shall avoid litigation, and the necessity for special legislation to relieve parties from decisions that are, under the circum- stances, onerous or unjust. At the present time cut hoops come in at the rate of duty paid on hoop-iron ; but there is an appeal in every case, and suits are being multiplied ; and by and by there will be a trial, and, from tbe experi- ence we have had, we cannot feel any assurance whatever that the present decision of the department, that the duty on hoop-iron should be imposed upon cut hoops, will be sustained. We have never, I think, got a verdict for the government on that question. Some people say that the New York juries favor the importer. But I do not think there is any more danger from New York juries than from juries in any other portion of the country. They always seem to think it is easier for the government to bear the loss than for the individual to do so ; that it is easier for a large corporation to bear a loss than for an indi- vidual; and all of us who have tried cases before a jury in which a cor- poration is a party, and where, for instance, a man lias lost a limb and has brought suit against them, always fear that the jury will go with the individual rather than with the corporation. I would now like to call the attention of the Commission to the silk tariff, which is found in Schedule H, paragraph 192. That article is all under paragraph 192 now, I believe. I can give you art illustration of the nicety of the questions that come up in the classification there. In the sixth line from the bottom of the section it reads as follows: “On all goods, wares, and merchandise, not otherwise herein provided for, made of silk, or of which silk is the component material of chief value, irre- spective of the classification thereof for duty by or under previous laws, or of their commercial designation, 60 per cent, ad valorem.” It would not occur to you, perhaps, at the first blush, that there was any difficulty in finding out whether silk was the component material of chief value or not, but we have found the utmost difficulty in determining that question. The appraisers and examiners who look at the goods in the first place have great difficulty in determining the actual proportions that enter into it, and to get an analysis where the question runs close. Besides that, there came this question : What do the words u chief value” mean ? To use a political phrase, do they mean a majority or a plurality f Must the article be more than half silk, or must silk be only more than either of the other components, to come under that designation'? That question nobody could settle.* The Commission would bepuzzled here, for I have no doubt that any two of the commissioners would be as likely to disagree as to agree upon this point. This question was sent to the * Attorney-General, and he gave his opinion (which is not binding on any court or jury) that silk was the component material of chief value if there was more silk in it than any other material; and that we under- stand to be the law now, or rather that is the rule of the department on that decision. It an article is not half silk, but has more value of silk than any other component in it, the silk is the component material of chief value. But we had another question running as close as this, and we sent it to the general appraisers, after puzzling our own heads over it. Our own heads do not give us much information as to what goods are made of by inspecting them. We have goods sent to us, and we send them out to experts to find out what they are made of. But this report came from the appraisers. They said , u We have examined these goods, and the question is very close.” It was upon the question covered by the last HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 163 proviso in section 192, as follows : u Provided , That this act shall not apply to goods, wares, or merchandise which have as a component mate rial thereof 25 per centum or over in value of cotton, flax, wool, or worsted.” The question was whether the goods under examination had more than 25 per cent, in value of cotton in them. They said that depended on what kind of cotton was used. If it was Sea Island cotton, there was more than 25 per cent, of cotton in it; but if it was common cot- ton, not so much ; and they said, “ We cannot tell which kind of cotton it is made of; nobody can determine whether it is Sea Island cotton or not.” I do not know that you can avoid just such questions as these, but with a list of these known ambiguities before you in your final making up of a tariff, you can avoid these old questions at any rate, and can prevent any future litigation upon the same point. Xow take the first schedule, which is not a favorite of mine, but it is the first on the list, and is as good an illustration of complexity as there is ; I refer to Schedule A, on page G of the pamphlet from which I am quoting. This is the very first section of the tariff, and I think the reading of that section, or a little portion of it, will illustrate what I mean by complexity as well as any explanation I can give. There are people to whom that schedule is just as clear as the doctrine of election and total depravity, or any of those subjects that are so well defined, but it certainly is not clear to the ordinary mind. Schedule A, cotton and cotton goods, reads as follows : Sec. 2504. On all manufactures of cotton (except jeans, denims, drillings, bed-tick- ings, giugliaras, plaids, cottonades, pantaloon stuff, and goods of like description) not bleached, colored, stained, painted, ox printed, and not exceeding one hundred threads to the square inch, counting the warp and filling, and exceeding in weight five ounces per square yard, five cents per square yard; if bleached, five cents and a half per square yard ; if colored, stained, painted, or printed, five cents and a half per square yard, and, in addition thereto, ten per centum ad valorem. As 1 say, the cotton people understand what that means, and I dare say the custom house officers understand it; but I do not think the knowl- edge extends beyond them. I do not think any of us ever will under- stand it ; I do not think it was intended we should. There is this diffi- culty in this whole cotton schedule, that it does not seem as if it was intended that the ordinary mind should be able to understand it so as to- classify the goods without appeal to a higher authority. In the first place, you must know how many threads there are to the square inch. Well, it is possible to count the threads if you have a powerful micro- scope and good eyes, and to count them correctly, and to determine whether there are 200 or 199 threads, counting both ways. Possibly that could be ascertained by measuring an inch of the cloth exactly and ascer- taining how many threads were contained within an inch. But that is bringing the question down to a very fine point when you get 200 threads to the square inch, and to know whether you get a thread on one or the other side of that number. Still I understand cotton goods are bought and sold by the count, and that is, perhaps, an easy way, or the best way for the cotton people to determine. Then we have, in addition to that, the weight per yard; five ounces per square yard; and then whether it comes within the exception or not; whether one of these dozen things that none of us know much about, is excepted. Further than that, if these things are known that have been referred to, then, whether it can be classed as goods of like description, because that is one of the elements which is provided for in section 4, which says: “On cotton jeans, denims, drillings, bed-tickings, ginghams, plaids, cottonades, TARIFF COMMISSION. [HENRY F. FRENCH. 164 pantaloon staffs, and goods of like description or for similar use. v Here is a chance for dispute, because these words are not in the first sec- tion. We are bound to presume that there is intention in everything that occurs, and that these words were intended to make some dis- tinction, yet it is pretty difficult to see why the clause should be so worded. On this question we have lately had a decision. We had so much difficulty in knowing what “ goods of like description” or “for similar use” were, that we sent the question to the general appraisers. The duty of the general appraisers is to assist the customs officers gen- erally in making their investigations. There are four general appraisers in the United States, and only four, and they are generally stationed at the principal ports. Their business is to assist at reappraisals where there is an appeal, if the importer is not satisfied with the value that is put on his importation by the regular appraisers. In that case he has the right to appeal to a general appraiser arid a merchant appraiser, and one of these four appraisers generally sits at one of the principal ports, and it occupies all his time in the city of New York to assist in these reappraisements. These four men have good salaries, and they are able men. I do not know that we could improve upon them if we were to make new appointments. We asked them to do something to aid us in regard to this doubt we entertained as to whether certain descrip- tions of goods were “goods of like description” or “for similar use.” They went to work and sent us down a few specimens, which I have here in these books. These are not full lines of cottons, as the traders say, but only a few of the various descriptions of goods to illustrate, according to the views of the general appraisers, how these different fabrics should be appraised. There are two books of them, as you will see (exhibit- ing), and they undertook to mark on each one of these, in one way or another, the name of the article, such as denims, pantaloon stuffs, cot- tonades, &c. They went all through these specimens, marking them by the price, &c., and where it did not come under any printed descrip- tion they wrote the designation in pencil. They went through all these and made a s report (it took them a great while to do it), and they-sent in their report. The principle they fixed upon in determining this question, and deciding whether these articles came within the excep- tions or not, was that if the goods were twilled, or if they were made in part of threads, dyed in the thread, colored before weaving, that brought them within the exception. That was pretty intelligible. They could find out, probably, whether the goods were twilled or whether the thread was colored before weaving. But, unfortunately, about the time we received these books and adopted their advice and published it, a case was tried in New York before Judge Shipman, and he instructed the jury that the question was not whether the goods were twilled or whether they were manufactured with thread colored before weaving, but whether one class of goods was for similar use, that is to say, whether one could be substituted for the other, irrespective of the mode of weaving, whether plain or twilled, or whether the thread was colored before weaving. That entirely upset the decision of the department, and those books will have to be made again entirely upon a new basis. When we have done that we shall go to the court and jury again upon any importation where the importer is not satisfied with the classifica- tion, to satisfy the jury whether the goods come within the exception, whether they are for similar use, or are denims, tickings, jeans, or whatever they may be. So that you see wherever , you strike the tariff you find from these refinements, which are wise if they could be understood, that difficulties HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 165 arise with which the custom-house officers and the Treasury Department cannot successfully struggle. We cannot tell what the facts are. We cannot execute the law to the satisfaction of the importer or the manu- facturers, who, of course, are always on the side of protection, and want a higher duty, while the importers want the lower duty, and the depart- ment does not care which prevails if it can find out what the duty ought to be. We shall always have controversies so long as ambiguities of this kind exist in the tariff. You must not think I have exhausted the subject of the difficulties under all these sections that intervene, but/ 1 will now read one portion of section 229. I do not know how long you will care to listen to this kind of talk. I have already occupied ■ good deal of time, and have not yet got through w T ith one page of my notes. But it seems to me that it is profitable to spend some time in considering these points in advance of any attempt to formulate the tariff. Take section 229, on the wool tariff, which says, u all wools, hair of the alpaca, goat, and other like animals,” &c. Your president can tell you in a moment what sort of an animal is like a goat ; but many people cannot. *He has written a learned address on subjects kindred to that, and knows all about it, and if we had his assistance we should have no difficulty in this classification. The President. It would require the writing of a whole book to tell it. The Witness. Well, I have never read any book through that would tell me what a like animal to an alpaca or a goat is. But a curious ques- tion came up recently, within a week or two, on this point. Let me call your attention to the proviso in paragraph 192, which we have been look- ing at. It says : u Provided, That this act shall not apply to goods, wares, or merchandise which have as a component material thereof 25 per centum or over in value of cotton, flax, wool, or worsted.” Now, here we had a fabric that had not any wool in it, but it had the hair of the goat in it, and the question was whether, if the fabric be composed of the hair of the alpaca or the goat, it comes within the pro- viso, or, m other words, whether we are to construe this hair as wool as classified under section 229. If the fabric was all made from the goat, or of wool, it would be easily classified, and probably if it had been thought of, in writing that proviso in section 192, hair would have been included in the proviso. But this was not done, and the question has been presented at one of the custom-houses how that class of goods should be classified. The President. The old Peruvians called the alpaca Peruvian sheep, and in that view their product would be wool. The Witness. But it is not called so in the tariff; it is called hair of the alpaca, and unless we can call it wool, it cannot come under that provision. I do not think any man would be prepared to vote hastily on a question like that, and it is merely an illustration that I happened to think of. I have already intimated that there are experts at the principal cus- tom-houses who are capable of going as much into detail as these sched- ules go as to cotton or wool. At New York, where we collect two-thirds of all the duties that are collected in the United States, we have a large number of officers — about 1,200 officers — who are thoroughly organized. In the appraiser’s office there are divisions, so that one department has charge of the woolen goods, another of silk goods, another of cutlery, and so on, and we have experts who can determine as well as anybody in the country as to these matters. This is also the case in Boston, 166 TARIFF COMMISSION. [HENRY f. french. though there is not so much business, of course, for them as in New York. In Philadelphia also, and Baltimore, and some of the larger ports we are able to have expert officers. An importation may be made into a port where the collector has no such assistants; where he has to act as collector, appraiser, surveyor, and everything else; and under what we call the immediate importation act, goods that come in, say to New York, are forwarded without appraisal to the interior ports in the West, because everybody naturally wants his particular city made a port of entry. So that there is occasion for all this classification and knowledge of value at these ports. But at these ports we cannot have any such experts, for there is not business enough to justify it. Yet all these questions are as likely to come up there as at the city of New York, though not in as large numbers, but we are liable to have just such cases for construction, and, of course, are liable to errors con- stantly, for the less skill there is the more errors will be likely to occur. I have already explained to you how these errors are corrected, or how it is attempted to correct them, and if it is within your jurisdiction, when you report to Congress I hope you will consider whether some- thing better cannot be done with appeals from the collectors of the ports than to send them to the Treasury Department for adjudication. We have no court there; we have no means of examining witnesses, unless they choose to come, and we never swear witnesses. We get ex parte affidavits of all kinds, and everybody knows you can prove anything by ex parte affidavits, and really the Secretary of the Treasury is in no position to determine these questions correctly. A great many of these questions come to me, and I have no special knowledge of the character of the goods unless occasionally, as was the case with hoop-iron and cotton-ties, when I have had my room filled with par- ties interested in having a hearing; and where there has been so much discussion I manage to get a pretty general knowledge of the subject. But in general I can have no special knowledge of steel or cotton goods, and nobody in the department can. It is much better to have some tribunal established where these appeals can go than to.have them all sent to the Treasury Department. The President. I believe you submitted a series of interrogatories to experts in different parts of the country asking their opinion as to what sort of a tribunal should be established for the determination of questions of this kind. Have you received any replies to those inquiries ? The Witness. I should be glad to state how that matter arose. Dur- ing Mr. Sherman’s administration, continuing four years. I was in the department all the time, having come into it under Mr. Morrill’s Secre- taryship. I was impressed with the vast importance of putting an end to these controversies. I think, during the four years in which Mr. Sherman was Secretary, eighteen thousand appeals from the customs officers to determine eighteen thousand cases in which the importers were dissatisfied with the classification came up to the customs di- vision for ns to determine in one way or another. You can, by com- puting, ascertain how many cases that would be every month, every week, and every day; and it was utterly impossible for us to determine them all satisfactorily. The customs division is under the charge of Mr. James, who is a very competent officer, and who has a good corps of clerks and assistants, He and I constitute a board for hearing these questions, and his office is divided in such a way that he has some experts iii regard to some of these articles. But, substan- tially, all these controversies come to my table, and I feel the utter impossibility of determining satisfactorily to myself such a vast amount HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 167 of questions. Of course the determination of some of them in one case covers a large number of cases of a like character. Sometimes a de- cision on a cotton-goods case will determine the question in fifty appeals, and so on. But still there are an immense number of different questions coming up there constantly of a very technical character. The Commission understand already that the Secretary has nothing to do with the appraisal of goods, that is, with the valuation of goods after it is determined under what provision they are to be classified. I have already said that errors of classification come up on appeal to the Secretary, and then suit is brought, if the decision of the Secretary is unsatisfactory to the importer. But the value of the goods, as to what they are worth, &c., is a matter determined by the appraiser’s office. He fixes their value. If that is satisfactory to the collector and the importer, that is the end of it; if it is not, the collector may order a reappraisal if he thinks proper, or the importer, if he is dissatisfied, may claim a reappraisal, and he appeals to what are called merchant appraisers. A merchant appraiser is a man supposed to be skilled in the particular article in question. He is appointed by the collector, and one of the four general appraisers sits with him in the principal ports and decides the value of goods on appeal, and their decision is conclusive. If these two men agree, their decision is final and the ques- tion cannot be carried any further. There is no appeal to the Secretary or to the courts; that is the end of it. If these two appraisers disa- gree, they report their disagreement to the collector, and be decides between them, and his decision is final. Long Branch, N. J., Thursday , July 27, 1882. My remarks yesterday were addressed to the importance of simplicity and the avoiding of complexity in the arrangement of the tariff. With your permission I will pursue the subject a little further. I will state, in the first place, that everybody suffers from these controversies which arise as to customs duties. The importer suffers by being delayed in getting what we call justice; sometimes for three or four years after it can be of any benefit to him. He ‘suffers by being obliged to sell his goods before he knows how much duty he has to pay on them. The consumer suffers because he has to pay on the assumption that the goods pay the largest duty in question, and the manufacturer suffers in various wavs; so that it is desirable that there should be an end of controversy if it is possible. Your president asked me yesterday what sort of a tribunal I would propose to adjust these controversies and bring them to a speedy ter- mination. I would like to postpone answering that question until I have time to consider it a little further. I have not yet considered the matter as much as seems to me necessary, and the papers which have been received relating to the subject are numerous and extensive, and are filed away in Washington. But the Commission will see, witn- out further statements from me, that this subject is a very important one, and that these controversies should be settled by some tribunal, so that a final decision can be speedily reached. This is a matter which I hope the Commission will carefully consider and report upon; but as I have said, I would like to pass over that subject for the present and proceed to suggest in what manner you may avoid complexity and 168 TARIFF COMMISSION. [HENRY F. FRENCH. controversy when you come to formulate a tariff. I would suggest, in the first place, as a general proposition, the avoidance of compound* duties. I know that it is impossible to do that in all cases. The wool tariff is formed throughout with as much care and fairness as possible; but still it would be better in every case where practicable to avoid compound duties. Either make them all ad valorem or all specific, be- cause there is difficulty on both points and you double the difficulty by having a double standard. Take Schedule E. I refer to that rather at random than otherwise. I will call your attention particularly to section 73, in regard to wire, which reads as follows : u Iron wire, bright, coppered, or tinned, drawn and finished, not more than one fourth of an inch in diameter, not less than number sixteen wire gauge, $2 per one hundred pounds, and in ad- dition thereto 15 ppr centum ad valorem ; over number sixteen and not over number twenty-five wire gauge, $3.50 per one hundred pounds, and in addition thereto 15 per centum ad valorem ; over number 16- and not over number twenty-five wire gauge, $3.50 per one hundred pounds, and in addition thereto 15 per centum ad valorem; over or finer than number twenty-five wire gauge, $4 per one hundred pounds, and in ad- dition thereto 15 per centum ad valorem.” It seems to me possible, with regard to an article like that, the manu- facture of it having existed long enough, that there might be such a set- tled value that the duty would be wholly specific or ad valorem. Which rate of duty would be best you will have to consider. But it seems to me that in the majority of instances you could decide upon and fix a rate of duty either specific or ad valorem w hich would answer the same puipose and avoid the chances of error. Under this particular section we have first the question whether it is iron wire or steel wire. In the second place, is it less than sixteen wire gauge ? That is another complexity. I suppose there ik no difficulty in ascertaining that by a gauge. In the next place, what is its value? There comes in the ad valorem question, and it seems to me you might avoid some of these complexities by a little care and by careful consultation in all cases with the manufacturers and dealers in these articles. It is not expected that a person in my position or in your position would be able to take up any one of these schedules and arrange them without careful consul- tation with experts. The same is true with regard to the ariicleof cotton, paragraphs one to six, which I went over yesterday. These are some of the questions which arise under those paragraphs. In the first place, is it cotton ? There we have a chance for controversy not very wide. Again, is it bleached? We have had a controversy about that matter, Avliether or not it w r as bleached ; if not bleached after the cloth was woven, Avas it made of bleached thread? Then again, is it colored or stained? That is another element in the distinctions of the cotton tariff. Then, what is its value in the foreign market from whence it Ava$ imported and where it was produced? I Avill at another tijne consider whether there is any need of going across the ocean to ascertain what is the A^alue of the article. We ought to be able to ascertain what it is valued at here. I will, perhaps, refer to these schedules again with a AieAv of ascertaining how they might be amended in order to simplify them. My second suggestion is, that all ambiguities in language should be avoided, and all loose terms in definition. We had yesterday a refer- ence to some of these terms, such as u goods of like description,” or u goods for similar use.” Those are perfect traps in Avhich to catch law- suits. Every time there will be a dispute as to Avhat goods are goods HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF 169 of like description. What does it mean, similarity of use similarity of structure in the weaving, similarity of materials, or what does it mean? That ambiguity runs through the whole of the cotton tariff. I do not take Schedule A for an illustration, because it is more ambiguous than any of the other schedules. I told you yesterday how the general ap- praisers and the courts had differed as to the definition of the terms “goods of like description,” or u goods for similar use.” Ambiguity often arises by including an article under two different classes, of course unintentionally, but by making them answer both descriptions. I will give you an illustration of that. Take section 68, of the metal tariff*, which says, “bar iron, rolled or hammered,” and going on to describe forty different kinds of iron. Most of the ordi- nary bar iron comes under this section 68, but when you turn to section 70, right beyond, yon find a provision made for “iron bars for railroads or inclined planes, 70 cents per one hundred pounds.” That is a less rate of duty than any on the bar iron. We have had just such a case as this. Bars of iron are imported to be used as a tramway on an inclined plane into some narrow mine, and the importers claim, and we think rightly, that although these bars are exactly like bar iron, and had they been for another use would have been assessed as bar iron, they were bought, and intended for bona fide use on an inclined plane for a railroad, or tramway, and should pay duty as iron bars for railroads. Now such ambiguities as that should not exist. It should not depend on the evidence brought to the customs officers or the Treasury Department as to the use actually intended to be made of an article. That is not the criterion by which we assess duties. Duties are assessed upon the article as it is when it comes into port. The duty is chargeable upon the article when it is imported, and it cannot be affected by the use that is made of it afterwards. A man may import iron for a railway in good faith, and if afterwards by some accident he has not occasion to use it for the use he originally intended, he may make use of it as he would of ordinary bar iron — iron in bars — and he is not liable to be reassessed. The fact that a man imports an article, professing it is to be used for one thing and then uses it for another purpose, might be evidence of fraudulent intent to evade the duty. But if he actually brings the article in in good faith, the question of how he uses it afterwards does not enter into the matter except as tending to show fraud. So that there should be no such dis- tinction. Commissioner McMahon. I understand you to say that you do not want it left the to customs officers to determine the question of what ulti- mate use is to be made of the article imported. But the law itself recog- nizes the question of ultimate use. For instance, take the article of pocket cutlery. It is intended that cutlery of that kind is for pocket use. The same with regard to ladies’ and children’s dress goods. These are well- known commercial terms, adopted on account of the use the articles are in- tended for. You do not mean to say to the Commission that they shall not use commercial or well-known terms simply because the use deter- mines what the article really is, do you? The Witness. No, I do not. But the illustration I gave you makes my meaning clear, I think. Here is an article which is not limited in its use by the terms of the tariff. Perhaps it is iron bars for railroads or inclined planes. I should interpret that, as iron bars suitable for that purpose. I should not say that if they were exactly alike 170 TARIFF COMMISSION. [HENRY F. FRENCH. the decision ought to depend upon evidence as to how they are to be used, because I say that if an article is imported in good faith for that use, and is best calculated for that use, it will be more profit- able for that use than any other. If a man should by any accident or change in his business have occasion to use these things for another purpose, I do not think the department could follow them and reassess them on account of that use. Yet, as a matter of description, as you say, an article intended for children’s wear is supposed to be put to that ultimate use. It is not a question of the intention of the man who im- ports it, only the manifest intention of the manufacturer. The ques- tion is, is it an article manufactured for that purpose? That gives it its character. It is not a question of whether the particular man who imports it imports it for one use or another. He may throw it into the fire Avhen he gets it, or he may make a better use of it than perhaps was intended. Yet the description applies in all these cases. By Commissioner Oliver : Q. Then, in that case, suppose a car-builder should import bars of iron which they use for the side bars of a car, say 20 in every car; they could be declared suitable for inclined planes on railroads. If they came in as car bars, they would come in at a duty of one and a quarter cents a pound, but under the construction you put upon it, if the man intended to bring them in for railroad bars and then used them for car bars, he would be having the advantage of his more honest competi- tor to the extent of half a cent a pound. — A. You are implying by your question that the man is committing fraud in doing it; that he has a fraudulent intention. I said, as a condition of my first statement, that the subsequent use for a different purpose from that professed for the importation, would be evidence tending to show that he had a fraudu- lent intention in his mind at the outset. How far that would affect the question since the decision of the court in the sugar cases, is something I canuot tell. Q. But I understand you to say if they could find a better use for it subsequently, they would have a right to so use it, and the government could not follow them? — A. Yes, sir. Commissioner Oliver. I think that is wrong. The Witness. It may be wrong, but it serves to illustrate the subject on which I am speaking, viz, that such ambiguities in the law should be avoided. Commissioner Oliver. From 1860 to 1870, iron rails were used for railroad purposes. Then they commenced to use steel rails iu England and threw out iron rails, and these iron rails were* shipped over here and brought in at $8 a ton. That is, they got them in as old iron at $8, although the rate of duty is $16 on rails. The Witness. The department has had all these questions before it, and I only refer to them to illustrate the difficulties which arise in set- tling questions of this kind satisfactorily either to ourselves or to any- body else. In regard to this article of scrap-iron, section 114 says : “Wrought scrap iron of every description, $8 per ton; but nothing else shall be deemed scrap-iron except waste or refuse iron that has been in actual use and is fit only to be remanufactured.” Under that provision, the department has held, to the satisfaction of almost everybody, that old rails taken out abroad and brought here, which are not fit to be laid and used in our railways (some of them double-headed rails which could not be used on any American railroad), although they were not wholly worn out, could be brought in as scrap-iron intended to HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 171 be remelted, and might come in at the rate of duty on scrap-iron, although they were good enough to have been used for a long time in England ; but we have held that in a cargo, a large invoice of these old rails, even if there were among them koine rails that could be selected and put into use on a short railroad, or used in repairs, the general invoice should be regarded as scrap iron intended to be remelted, and the fact that a tew of the rails were in a good condition did not change the general character of the invoice. This is as far as we have gone in that direc- tion. But that clause is exceedingly difficult to execute. We had just the case that has been propounded to me, where there was an importa- tion of a larg6 quantity of old rails from Canada. They were taken up, and intended to be used as scrap iron, but they were brought into this country, and one invoice of them was sent down to be laid for a short railway, and a special agent found it out and reported the fact. My recollection is that the rails came in at different times, and one lot of them was actually laid down or strewed along the road for the pur- pose of building a railroad, and it was said that that w r as a fraud, and they were seized, and the question came up before the department, and we did the best we could in regard to the matter. We looked into the subject, and we found that they were old rails, and none of them fit to be put on what would be called a first-class railway, but some were fit to be used for a temporary purpose, for a short line of railway,* and we compromised the matter by allowing them to pay on one invoice (I think there were three invoices altogether) the duty on rails, and on the other two invoices we allowed them to pay the duty on scrap-iron. We did this because we thought it was the best way we could get out of the diffi- culty. Nobody pretended that there was any fraud intended by it, or that there was any intention of using the rails as rails when they were brought in at the price of scrap-iron. But when they came to get them in, they found them better than they expected, and they used a portion of them in the way I have indicated, and to avoid any controversy we made the compromise as stated. That only illustrates the difficulty of executing laws which have in them that sort of ambiguity. I would call your attention, as a third suggestion, to the importance of avoiding impracticable distinctions. Take the article of nickel re- ferred to in paragraph 138, and which is assessable at 30 cents a pound. By paragraph 130, nickel alloyed with copper is assessed at 20 cents a pound. The Commission has already heard Mr. Wharton on this sub- ject, and he is engaged in that manufacture and understands more about it than anybody else in this country, and I have conversed with him fully on all these topics. The importation of nickel alloy began with about one-half copper and one-half nickel, though 1 do not understand that nickel is found combined originally with copper. But at any rate there seemed to have been some article called an alloy of copper with nickel, and it was a recognized article. Afterwards we had an impor- tation of an article containing 95 per cent, of nickel and 5 per cent, of copper. That seemed to be a pretty severe test of the law, and we had it analyzed, and there was no doubt of the proportions of the alloy. There was no doubt, either, that that was an intentional combination, made with reference to the tariff. That question came up about the time that Secretary Windom came into office, although I think it had been discussed before Mr. Sherman. I went through the wjiole matter as carefully as 1 could, but preferred to take the opinion of the Secretary on it, and laid the papers all before him. The Secretary did not decide the matter during his term of office, and when Mr. Folger came in as Secretary the question still remained there. I made a short brief, after 172 TARIFF COMMISSION. [HENRY F. FRENCH. we bad obtained the decision on the sugar question, which seemed to me to have some bearing upon it. Before that, I had the impression that it was a fraudulent evasion of the law, and that the article ought to be assessed as pure nickel at 30 cents a pound. When men deliber- ately took nickel that was pure and put 5 per cent, of copper with it, to make an alloy of nickel lor the purpose of getting it in here at the lower rate of duty which our laws authorized, I thought that was a fraud and we should assess it as pure nickel. But the Supreme Court of the United States decided in the sugar cases that a man might color pure sugar with black molasses in a vacuum pan for the purpose of re- ducing the color below its normal color, and that such sugar might be imported in the United States at a lower rate of duty. Those facts were admitted; that the sugar was of the highest grade and had been colored in that way down to the lowest grade, so as to entitle it to be admitted at the lowest rate of duty. But that was the decision of the Supreme Court of the United States. I made a suggestion to the Secretary on this nickel question, that if that was the law then the nickel men un- doubtedly had the right to take the nickel, melt it up, and put 5 per cent of copper with it, and bring it in here and pay duty on it as an alloy of nickel with copper. And I do not know how we can escape that conclusion. I do not know how we can escape the application of that decision to a great many cases where we were inclined to say that the thing was a palpable fraud on the revenue, and should not be coun- tenanced by the courts or anybody else. You probably have heard of the case that arose, I think, iii Boston, where a party imported a large invoice of lead, but brought it in under the form of statuary — it bearing a less rate of duty. Commissioner McMahon. That occurred in New York, I believe. The Witness. Perhaps so. At any rate a ship load of pig-lead was , imported in the shape of statues of General Washington, Dr. Franklin, and other honest and worthy individuals, and it was entered as statuary. Well, everybody who heard that I think was amazed that such a fraud, or what seemed to be such a fraud, could be recognized as an honest transaction. I never have met anybody who did not at once say that it was such a palpable fraud that any court, or any officer of customs must recognize it as such. Yet, I do not see why, under the decision that has been made with regard to sugar, it was not a perfectly legitimate thing for the parties importing it to do ; and if they had the right to color sugar, to bring it in at a lower rate of duty, where does it differ from the case cited f As the counsel said in the course of his argument in the sugar cases, u Have not the importers the right to adapt their man- ufacture to the American tariff ?” The statute says that sugar of a cer- tain color shall come in at a specified duty; and they claim they had a right to color it, and bring in a high grade of sugar at the rate imposed upon the lower grade of sugar through the process ot coloring. As I remarked, in regard to the article of nickel, the tariff' should not be left in the condition of uncertainty that now exists in regard to this article. The Commission might prepare a tariff placing nickel and nickel* alloy at the rate of 25 or 30 cents a pound, and thus avoid any contro- versy of that kind. It was suggested to me, and 1 suggested it to the Commission yester- day, that there was some revision necessary of paragraphs Nos. 08, 70, and 80, relating to the duty on iron, which put band, hoop, and scroll iron at a different tfkte of duty from bar iron, so that we have cases where it is very difficult to determine whether an article was band iron, or should come in under the other designations. We have had great HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 173 difficulty in determining whether an article of a certain description came in under paragraph 68 as bar iron, or whether it was band iron, as re ferred to in paragraph 80, or whether it was rolled or hammered iron. One way to avoid any difficulty of that sort, is to put the same rate of duty on the whole class of articles, and fix it at 1J, If , or 1J cents a pound. 1 do not hnow but that the rolling of iron thinner makes it cost more ; but iron-men will know all about that. You will find a similar ambiguity in paragraph 43, which reads: On all burlaps and like manufactures of flax, jute, or hemp, or of which flax, jute, or hemp shall be the component material of chief value, excepting such as may be suitable for bagging for cotton, 30 per centum ad valorem. That sentence is full of all sorts of ambiguities. Then in paragraph 44 we have a similar article of goods : Oil-cloth foundations, or floor-cloth, canvas, made of flax, jute, or hemp, or of which flax, jute, or hemp shall be the component material of chief value, 40 per centum ad valorem. A different rate from the other, which is 30 per cent. ; and I under- stand that there is great difficulty in some classes of articles in deter- mining under >yhich of these descriptions the article shall be classed. The same % difficulty arises, also, in the case of carpets. Hemp yarn is taxed at 5 cents a pound. We have had cases where we cannot tell whether the article is hemp yarn or carpet yarn, at these different rates. The drift of all these suggestions is, that before you undertake to formulate the tariff you should raise as many of these questions, or get experts to raise them, and get a list of them, as possible ; eliminate just as many as you can from the tariff which you may finally propose. Again, as to specific and ad valorem rates. I think the only rule that can be given about that is, that in your good judgment you do as you think best as to the particular article under consideration. I do not think that you can say that a specific duty, as a general thing, is better than an ad valorem duty, or the reverse. I do not think you can apply any general rule by which you can avoid any ad valorem duty. The general impression is, that a specific duty is much better than an ad valorem duty ; that it is much more simple, more easily adjusted, and less liable to fraud. But I think that quite doubtful. In the first place the ad va- lorem duty is more equal. Certainly, as to importations, we have in view chiefly their value. We intend to recognize a sort of justice, inde- pendent of the matter of protection, by putting a like and proportion- ate duty on a whole class of similar articles; and, unless there is rea- son for discrimination, we do that. All taxation is really based on value. It would be absurd, for instance, in our State to tax every farm at one rate as a specific duty. It would be easier to say that a farm, or a house, or a horse, should pay the same rate of duty. The day before I came from Washington there came to me a letter from a special agent, who had been in Canada, proposing that every horse should pay a specific rate of duty of, say, $20. That is a very easy way of assessing the duty; but is there any sort of justice in it? Animals imported for breeding purposes come in free, but valuable geldings are imported often worth a thousand dollars each, and it would not be right that a horse of that description should be admitted on the same specific duty as a horse worth only one hundred dollars. I think the special agent who made that recommendation made it in good faith, because he had been troubled to find out how much a horse was actually worth. We have had many controversies upon that question. You would have the same difficulty also with woven goods ; so much 174 TARIFF COMMISSION. [HENRY F. FRENCH. a yard on every yard of silk, so much on every yard of broadcloth, and every fabric of that description. It seems to me that it would not help the matter much to put the duty at so much per yard on cloth worth so much a yard, because there is the same difficulty of the ad valorem ; you have your price to ascertain before you can fix your specific duty. It has the complexity of the compound duty. FOREIGN OR HOME VALUATION. Passing over some notes which I have made in this same direc- tion, I come to the question of foreign values. I think the question whether your Commission should not recommend a home valuation in- stead of a foreign valuation is one of the most important you should consider. By section 2902 of the Bevised Statutes it is provided that — It shall he the duty of the appraisers of the United States, and every of them, and every person who shall act as such appraiser, or of the collector and naval officer, as the case may be, by all reasonable ways and means in his and their power, to ascer- tain, estimate, and appraise the true and actual market value and wholesale price, any invoice or affidavit thereto to the contrary notwithstanding, of the merchandise at the time of exportation, and in the principal markets of the country whence the same has been imported into the United States. Why should we go to India, or to England, or anywhere else, to ascer- tain what the value is or was there, rather than to take the value in the the port of importation, or in the principal markets of the United States, which would be the better term or better method? It seems to me that it is one of the curiosities in the law that such a provision should have existed from 1799 down to the present time ; and I think it only exists now because nobody has really thought it possible to change a thing that has existed so long. People have supposed that there must be some reason that they did not understand, why the foreign value should be found, rather than the home value. That is not the worst, or nearly the worst, of these provisions. Under section 2907 you will find this : In determining the dutiable value of merchandise there shall be added to the cost or to the actual wholesale price, or general market value at the time of exportation in the principal markets of the country from whence the same has been imported into the United States, the cost of transportation, shipment, and transshipment, with ail the expenses included, from the place of growth, production, or manufacture, whether by land or water, to the vessel in which shipment is made to the United States ; the value of the sacks, box, or covering of any kind in which such merchan- dise is contained ; commission at the usual rates, but in no case less than two and a half percentuiA ; and brokerage, export duty, and all other actual or usual charges, for putting up, preparing, and packing for transportation or shipment. All that is added to the price of the goods to make the value. There never was a better illustration, perhaps, of the folly, if I may say so, of maintaining such provisions as these, than is found in what are called the charges and commissions cases, of which you have all read or heard. About twenty -five years ago an unfortunate Secretary of the Treasury ruled that two and a half per cent. (I think that was the sum) might be added in all cases for commissions, whereas the statute pro- vided that the usual commission should be added, and the courts rightly held that the Secretary of the Treasury could not say arbitrarily that two and a half per cent, was the usual commission, when, in fact, 2 per cent, was a more usual commission, and sometimes even a less sum than that. That is only one of the questions, but it was the main ques- tion. Out of that controversy 1,406 suits were brought about the year 1856 ; 776 of these suits were pending in 1877, twenty-one years after the suits were commenced. I had occasion to investigate the subject HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 175 the first year I was in the department, in 1877, and I made a report which was printed. Two million dollars had been paid out before De- cember 14, 1877, in the charges and commissions cases, and the remain- ing suits involved fully that amount ; that is to say, more than that amount was claimed and more was in controversy. And to show you how necessary some dispatch is in any case, and how impossible it is ever to get an end to an old controversy, it is a fact that since those suits were commenced there have been 15 different Secretaries of the Treasury, the duty of each one of whom it was to investigate the charges and commissions cases and know all about them so far as to be familiar with them, make recommendations to Congress, and give instructions to the law officers (the prosecuting officers) how to manage them. There have been 15 Attorneys -General whose duty it was to attend to these suits and, of course, to know the details and complexities of all the questions contained in them. There have been ten United States attor- neys in the southern district of New York, where nearly all of these suits were pending, all since October 4, 1856. Now, all that controversy arose, and still exists, upon the difficulty of executing (upon a little mistake made) the requirements of what are now found in section 2907, and it seems very desirable to avoid any such controversies in the future. That was an excusable error that might readily be made by any Secretary of the Treasury in construing the statute. Under Secretary Sherman the subject was taken up, and he indignantly frowned on the whole class of cases, and said he would not pay them, even if they got judgment, and he laid the matter before Con- gress, and you will find in the appropriation for the years 188U and 1881 that Congress declared that an appropriation to refund customs duties should not be applied to any of the cases known as the charges and commissions cases, without the special authority of the Secretary of the Treasury, and vested him with discretion to compromise these suits in any way that he thought proper, either in court or out of court. Under that arrangement General Curtis (who has become almost as famous of late as a defendant in a suit brought against him for collect- ing assessments for political purposes as he was in leading one of our columns in the assault on Fort Fisher) was appointed agent by Mr. Sherman to take charge of these suits, and to make such arrangements as lie might be able in order to bring them to a compromise. Under his administration the greater part of the suits were settled. I am sorry that I have not had time to examine and ascertain how many suits are now pending. There were 776 suits remaining in 1877, and not many of them were settled until General Curtis undertook this duty. I think perhaps 150 or 200 of them still remain. The greater part of the suits were settled as I have indicated. They found in a great many cases false protests had been filed. A suit cannot be brought unless the impor ter, who thinks he is aggrieved by an assessment of duty, files a protest. It was found on examination that, I think, in the majority the 1,400 cases there were either no protests, or protests that were falsely put upon the record, and which were detected by the form used, which was a printed form. It was ascertained by careful inquiry that the form used was not printed until long after these protests purported to have been made. And the point was made so clear that the coun- sel who had charge of these cases were obliged to concede they could not prove their cases in court, and abandoned them. In some cases, where there appeared to be a just or legal claim, it was found that two suits had been brought on the same cause of action by different attor- neys. Most of the cases were speculative in their character, and the 176 TARIFF COMMISSION. [HENRY F. FRENCH. importers had but little interest in them, and in some cases declared that they did not know they had any such suit pending. All these ir- regularities were discovered upon an investigation by General Curtis, and a large proportion of the suits wei e terminated in that way. Now, is there any reason for ascertaining what the goods cost, and adding these complicated charges and commissions to the cost? Is there any reason in the world why the home valuation should not be the val- uation placed upcn them? Commissioner Ambler. Suppose it is an article entirely imported, and assume that the rate paid is 35 per cent, ad valorem. That, of course, would enter into the price on this side of the water, and your home price would be with the tariff added. That would be adding a tariff on the tariff, as it seems to me; that is, on the rate paid? The Witness. Well, that matter would have to be arranged, of course. Commissioner McMahon. I believe there is another objection urged, that it frequently happens that goods are imported that have no market value here ; something new is manufactured and sent here. What should you do in such a case as that? It is only about twelve or fifteen years since the first Japanese goods were to be found in New York City. Commissioner Ambler. That could be obviated by a special provision to meet those goods. The Witness. There is another practical difficulty. I suppose the members of the Commission are familiar with the fact that large invoices come into New York, notably of silk goods, which are not sold in any other market, except the American market. The factory where they are manufactured is devoted to a certain line of goods, especially made for the American market, and they are not sold abroad, but are con- signed to an agent here, and the price is fixed in the invoice as the con- signor or the consignee wants it, and when they come here there is no for- eign market value. In such cases we have been through the absurdity of trying to ascertain what the goods are worth in a foreign market by finding what they are worth in this market, and adding to that the costs and charges, and so working back from the original value here to ascer- tain the foreign value iu order that we might assess the duties in this country. We have been obliged to do that because there was no foreign value upon those articles. Of course, in all of them, even in Japanese goods, they soon have a market value here, and the value in Japan is not of any particular consequence that I know of. But in every case, if you desire to fix the home value, you have the foreign invoice. It is now nothing but prima facie evidence. The law says that the real value shall be ascertained; so that whatever the invoice says, you can fix the home value by any other means at yore command. Long Branch, N. J., Friday , July 28, 1882. When I closed my remarks yesterday, I was on the subject of home and foreign valuation. I think any person who should be told for the first time that we look abroad in order to find out what duty we should assess upon an imported article, would be very much puzzled to know what reason there could possibly be for so doing, or how we were any better able to find out in that way than we should by sub- mitting to our appraisers the question, what is the article worth on a valuation to be fixed here ? But the answer is very apparent if you HENRY F. FRENCH'. J AMBIGUITIES OF THE TARIFF. 177 look at the condition of things in 1799, when the first enactment of this kind was made. At that time the country was young, and the value of manufactured articles was not known. Imported articles had no fixed value, as they now have, and therefore there was occasion to go abroad to see what the article cost. There was not then, as there is now, communication between the different ports, and there were no opportunities for consultation between officers of the different ports. It was, therefore, necessary to find out what the articles cost. If you look at the old statute you will see that the leading idea was to find what was actually paid for the article, when and where it was purchased, and that was a very fair criterion. A thing sold in a fair market is ordinarily bought and sold at its fair value. And so it was provided that the value should be fixed by the u original invoice,” and the u bill of loading,” as it was called in the old statutes, that is to say, the bill of sale, as I suppose it was — the actual bill of sale that passed from the seller to the buyer. The oath was that this was the original bill of sale or original invoice, and these were the original u bills of load- ing.” It was assumed that the honest transaction would be disclosed, and then it might fairly be taken with such additions as were afterwards made. I think there were no charges or commissions so long ago as that. It was the simple question as to how much the article cost. After a while it was found that the original invoice, as it is still called, was no criterion of value, because it was found that one price could be paid and a different price put in the bill of sale or invoice. And so, many years afterwards, I think not until 1842, authority was given to the appraiser to disregard the invoice and ascertain by every means in his power the true value of the article. He was not limited to the invoice price but was allowed to go about among his neigh- bors and ascertain by any means in his power what the fair value was in the market of the country from which the article was brought. Thus the original idea of assuming that the bill of sale and bill of loading disclosed the true value, and relying upon that, is entirely waived, and no appraiser feels safe for a moment to regard the invoice produced, although sworn to forty times, as showing the true price at which the article was bought and- sold. Undervaluation and fraudu- lent invoices of all kinds occur, so that the reason why the foreign value was taken instead of the home value has entirely disappeared. There is no reason that I can see why the value in the ports of the Uni- ted States upon every article cannot as well be ascertaimed as the for- eign value, and, indeed, much better. What article can be named which the appraisers in one of our ports cannot ascertain the value of, being at liberty to look at the invoice, to examine on oath the importer, to inquiry in every direction what such articles are bought and sold for in this country and other countries. Why can they not ascertain the home value, and why is not that the simplest way Then, as I said yesterday, you get rid of this whole class of charges and commissions, which is an outrage in itself, I was going to say. It is a provision of law that cannot be fairly executed. Invoices come into New York in English, in German, in Spanish, French, and Italian, and all other known languages. The charges and commissions are entered in those various languages, and in the currencies of those countries. You not only have to know foreign languages, but to know foreign moneys — pounds, shillings, pence, francs, ducats, thalers — everything else you can conceive of. Those must all be reduced to American currency in order to be un- derstood. Some of it is depreciated currency, but it all lias to be re- duced to a gold standard before it can be dealt with in the invoices. H. Mis. 0 12 178 TARIFF COMMISSION. [HENRY F. FRENCH. Then, as I read from section 2502 of the Kevised Statutes, if there are general charges upon an invoice containing several descriptions or ar- ticles, the custom-house officers are required to distribute fairly among the different classes of articles this amount of general charges and com- missions, and that, I think I may say, is an impossible thing to do fairly. I do not think any custom-house officer will say that in a com- plicated invoice of that kind he can succeed in administering the law to his own satisfaction. By Commissioner McMahon : Q. As you say, the law provides that the charges shall be distributed pro rata on the different classes of articles, and it sometimes happens that a change of the one-tenth part of a mill , where there are large quantities of goods thrown from one rate of duty to another, will make a very large total difference in the charges upon the different articles'? — A. That is very true, and I think you can get rid of that whole compli- cated matter of charges and commissions, and that it is very desirable that you should do so. It seems to me that is a very great object to be attained, and I think the matter should be made a prominent one in your deliberations in order to elicit any objections that may be made to the change. Let it be understood that the proposition is before the commission to change that important practice. It takes a long time to make any changes, and perhaps Congress is not prepared to adopt any such change. Another matter to which I alluded yesterday was the fact that for- merly most of the goods that were imported were actually bought and sold. They were imported by the buyer, and purchased in the market at a fair and regular price. Now, a great proportion of the goods that come into the market (dress goods, and silk particularly) are consigned. They are not sold before they come to this country, and, as I said yes- terday, in the silks particularly, there are large establishments which manufacture for the American market and sell to one particular Amer- ican dealer. A house in New York will have a line of goods manufact- ured especially for them in France, perhaps in Lyons, and will import all the goods that are manufactured by that house, themselves. They will have no competition in the market. These goods are not sold in the foreign market at all. They have no established price abroad, and the ^question is, How shall they be valued here ? We have to find out how much the goods sell for here, and how much they must cost. The raw material costs so much, the labor so much, and other goods somewhat like them sell for so much. We thus work out the problem, and we assume a foreign price which never did exist, because (as I have said) there is no sale abroad for these goods. By that sort of computation we get at the foreign price. It cannot be done in any other way. As to consigned goods, they are in the same position. xV silk manu- facturer in France who makes a particular kind of goods for this market has an agent in New York to whom all these goods are consigned. They do not sell a yard of them in the open market but send them here on consignment. There is no French value for them by which our statute can be complied with, but it has to be ascertained. The invoice is made up as the law contemplates, but it is made up at the lowest value which the consignors dare to fix for the goods, because if the value were fixed too low they know that it would be raised here. There is, therefore, no sense in retaining this provision for foreign valuation. It is the home valuation, in fact, which should control the duty. Besides the article of silks, gloves are also consigned (a very large HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 179 proportion of them), and so are all fancy articles of women’s dress. We frequently have communications from our special agents on the subject, stating that these goods are undervalued. Investigations are made abroad, and we have hearings here, and have constant controversies on these points. About three years ago our special agents, whose business it is to hunt up frauds of this kind, reported that there must be a great undervaluation in silks, because the silks were selling in New York at a less price than they were selling for in the places where they were man- ufactured. That they proved to the satisfaction of the Treasury Depart- ment. At first we could get no solution of the mystery; but, finally, it was ascertained that in fact the goods were sent here (sold or consigned) and were put on the market at a less price than they could be manufac- tured for. The explanation was that there had been a surplus of that kind of goods in the market (they having been overproduced), and the manufacturers had come to the conclusion that they must clear out their warehouses ; and so they had sent their goods to the New York market to sell for just what they would bring. Now in such cases there is no propriety in going back for three or four years and finding out what goods were sold for abroad at that time. There is no propriety in making these goods pay duty on more than their value in this market when imported. I do not know that, in the course of my remarks as to simplifying the tariff, I have alluded to the number of articles covered by our tariff, and which our customs officers are obliged to understand. It is pretty hard to make a count, because some classes of articles are divided more than others; and two persons making a count of these articles would not perhaps agree as to the number. But we understand that something more than 2,300 articles may fairly be regarded as enumerated in our tariff", while in the English tariff there are but fifty -five. In addition to these there are “goods of like description” and “goods for similar use”; and, in my remarks about the cotton schedule, you will see how nice and specific and particular the knowledge on the part of custom-house offi- cers must be to enable them to execute the law at all. Of course, the general tenor of my discussion has been that you ought to reduce the number of articles by a more general classification, by omitting all the fine-spun distinctions that have meaning to the manufacturers but that cannot be understood by the customs officers in all the ports of the country. It is idle to make such distinctions when they cannot be carried out. Commissioner McMahon. These distinctions are not understood by the manufacturers any more than they are by the importers or the custom house officers. No two experts will agree as to whether an article is “similar ” to another article or not. The experts differ among themselves all the time. The Witness. With these general remarks I will turn to my old friend, the cotton schedule, which 1 took because it was A, and not because I had any particular spite against that schedule more than against any other ; but it is a good one for illustration. Of course the cotton people will not be satisfied with the suggestion that I make; they probably will not be satisfied without distinctions for goods that count 200, 300, or 400 threads to the square inch. They will say (and theoretically they will be right) that one of these articles needs more protection than another. But 1 still think that, in revising this cotton schedule, the greater part of these little distinctions ought to be struck out. I have shown you already that, because of these terms “of like description” 180 TARIFF COMMISSION. [HENRY F. FRENCH. and “for similar use,” the general appraisers and the courts cannot agree at all. The tariff has been in operation for many years, and yet these questions have not been settled. It is idle, therefore, to keep distinctions on the statute-book which cannot be practically executed and so cannot be of any value. I should like to make some suggestion now as to how I think the cot- ton schedule ought to be altered. The first six paragraphs provide for the duties on fabrics woven from cotton. I have gone over this schedule A with the help of Mr. Meredith, one of the general appraisers. I will try to show how these paragraphs can be consolidated and condensed into a very small compass. Of course I will not undertake to suggest how many cents per yard you will put on, or what rate ad valorem, but I will merely suggest a system of classification which seems to me minute enough for such a schedule. The six paragraphs cover about one printed page. The first modification that I will suggest is in refer- ence to the number of threads to the square inch, what is called “count- able cottons.” Cottons are ordered containing so many threads to the square inch. That is a mode in use between buyers and sellers. It is one of the elements in bills of sale and in orders for goods. If you discard that distinction, I think that these six paragraphs may be put into 12 lines. I would strike out the exception about jeans, denims, drillings, &c., and would make it read: On all manufactures of cotton not bleached, colored, stained, painted, or printed, and exceeding in weight 5 ounces to the square yard, so much per square yard. If bleached (and if bleaching is an element of value that is to be taxed), so much per square yard. If colored, stained, or printed, so much per square yard (leaving out the 10 per cent, ad val- orem) ; that is, I would make three grades of cotton cloths — those that are unbleached, those that are bleached, and those that are colored, and I would put upon them the proper rate of duty, either specific or ad valorem. I would not put on both specific and ad valorem if I could possibly avoid it; still, there may be cases where it is unavoidable. The wool schedule has compound duties based on the philosophic prin- ciple that there was a double aspect to the case — the desire to protect, fairly, the wool grower and the wool manufacturer. I do not see any particular object in retaining the compound duties in the cotton sched- ule. The President. There is not the same necessity for the compound duties in the cotton schedule that there is in the wool schedule, because there is no duty on the raw cotton. The Witness. Exactly. Then I want to say — On finer or lighter goods of like description, unbleached, so many cents per square yard. If colored, stained, or printed, so many cents per square yard. Paragraph 3 contains one of the curiosities of the literature of the tariff. It is exactly the same as paragraph 2. It undertakes to dis- criminate between goods exceeding, and goods not exceeding, 200 threads to the square inch, but it actually makes no discrimination. It taxes them both equally — 5J cents per square yard and 20 per cent, ad valorem. And yet even so sharp a man as Appraiser Meredith never noticed that until I pointed it out to him. It is a singular fact that that peculiarity should have so long remained undiscovered. Then I would cancel paragraphs 3, 4, 5, and 0, and instead of them I would add these words : Provided that no cotton goods shall he admitted at a less rate of duty than so much per cent, (say 25) ad valorem. HENRY F. FRENCH. ] AMBIGUITIES OF THE TARIFF. 181 That will take up all the descriptions of cotton fabrics not specified in the first two paragraphs, and will keep the duty up to whatever you con- clude should be the minimum ad valorem rate. The last proviso in the 6th paragraph, “provided further, that no cotton goods having more than 200 threads to the square inch, counting the warp and filling, shall be admitted to a less rate of duty than is provided for goods which are of that number of threads,” has no meaning. Commissioner McMahon. It is construed at the custom-house to mean that whichever rate of duty is the greater shall be paid. The Witness. I know that the general appraisers have recommended that as the construction. The President. r \ hat is Treasury law. The Witness. Yes; that is Treasury law. Talking with Mr. Mere- dith the other day I could not make him understand (what I think you will see at once) that the phrase, as it stands, does not mean anything. He said he thought it had a meaning. But still he wrote the proviso which I have now suggested. If you adopt that, even leaving in all this counting of threads to the square inch (which, perhaps, is well enough), you can put all these six paragraphs into twelve lines. Or if you want to make the schedule still more simple, omit the whole of six paragraphs and insert in lieu of them — Oil all cotton goods, manufactured, valued above 25 cents per square yard, so much per cent. ; on all valued above 16 cents and not above 25, so much per cent. ; and on all valued not above 16 cents, so much per cent. That would cover the whole cotton schedule, from beginning to end. Assuming that the rates are properly adjusted, I do not see why that could not be substituted, substantially, for the existing cotton schedule. And then, if an additional rate is to be put on for coloring, you might say, u on all colored cotton goods, so much per cent.” I should expect, if the commission had cotton manufacturers here, that they would at once criticise this method of making the cotton schedule; but that is what I want them to do. I want to propose something definite. I am working in the direction of simplifying the tariff so that it can be intel- ligently executed. The President. It is very important that your observations should be printed, so that the manufacturers may be able to see them. Commissioner McMahon. Of course it costs more to make an article of 200 threads to the square inch than one of 100 threads; and of course bleached goods cost more than unbleached goods. The present average rate of duty on cotton goods is something like 65 per cent. Assuming that Congress wishes to reduce the duty, why not say at once, in one line, “On all manufactures of cotton, of every description, 50 per cent, ad valorem”? The Witness. I see that Arnold, Constable & Co., of New York, pro- pose 20 per cent. I understand 38£ per cent, to be the average ad valo- rem rate of duty. That is all that 1 have to say on the general subject of simplifying the tariff. I have been making this poor schedule A the victim of my observations, taking it as a text tor my remarks. I have here a few more instances of the controversies about metals, but I do not know that it is worth while to go into that matter, or that it would be worth your while to listen to me. I have already mentioned the controversy as to whether an article should come in under para- graph 68 or under paragraphs 70, 80, or 81, all referring to iron of various kinds ; and whether bars intended for railway or tramway should pay 70 per cent, ad valorem or 1£ cents per pound as bar iron. There is another question on which we have had a great deal of trouble, 182 TARIFF COMMISSION. [URNBY F. FKKNCH. and on wliicli the iron manufacturers have pretty decided views ; that is, when plate iron becomes a “manufacture of iron” liable, under par- agraph 14G, to a duty of 35 per cent, ad valorem. We have had one suit in which it was held by the department that corrugated iron, used for the roofing of the Grand Central Railroad depot in New York, was plate iron, but the Treasury Department was beaten in it, and it was decided by a court and jury that it should come in as a manufacture of iron paying 35 per cent, ad valorem. The department feels bound by that decision. We have had importations of tank-plates — plates of iron for those immense tanks for the storage of petroleum oil. They came in in plates cut to dimensions and punched for riveting, and it was claimed that they should pay duty as manufactures of iron and not as plate iron. The decision of the Secretary of the Treasury was first in favor of their being taxed as manufactures of iron, but, after a good deal of stress on the part of iron manufacturers, that decision was re- versed. We understood that it would nearly ruin Pittsburgh if they were admitted at 35 per cent. We had a long hearing on the subject of car-truck channels — whether they should come in as manufactures of iron or whether they should come in, under paragraph 82, as “ all other descriptions of rolled or hammered iron not otherwise provided for, 1^ cents per pound,” which would be, I suppose, two or three times as much as 35 per cent, ad valorem. We have had another long heariug as to whether “forged-steel axles” for cars should be considered as a manu- factured article of steel, under paragraph 91, paying 45 per cent, ad valorem, or whether it should be regarded as an axle, under paragraph 99, paying 2| cents a pound. Commissioner Oliver. That should have been a plain question. The Witness. It was so plain that the Treasury Department held it under advisement for three months. Commissioner Oliver. If an axle is not an axle, I cannot imagine what else it is. The Witness. But this was the forging for an axle. It was as near an axle as could be made under a trip hammer. Commissioner McMahon. They were invoiced as actual forgings, and we held that they were not axles until they were complete. The Witness. In order to make it a complete axle the end, of course, must be cut off. They had afterwards to be fitted to the hub. They did not require any great alteration in shape. The two things are very much alike, as they lie side by side; but it was a very nice question whether the article was an axle forging or whether it was an axle. To show you how nice a question is concealed under paragraph 91. It reads : All manufactures of steel, or of which steel shall he a component part, not otherwise provided for, 45 per cent, ad valorem. But all articles of steel partially manufact- ured, or of which steel shall he a component part, not otherwise provided for, shall pay the same rate of duty as if wholly manufactured. Now, take the article of steel tire, forged as nearly as you can get it, to go on to a locomotive. It is bent into shape, a complete circle, but it is not finished so that it can be regarded as a locomotive tire, pro- vided for in paragraph 94, and paying 3 cents per pound. Commissioner McMahon. Is it not an unfinished locomotive tire? The Witness. It is a partly manufactured locomotive tire, of steel; and, if not otherwise provided for, it would be so rated. But a loco- motive tire is “ otherwise provided for.” It does not come within the language of this description : “All articles of steel, partially manufact- henry F. french.] AMBIGUITIES OF THE TARIFF. 183 u red, not otherwise provided for.” It is a partially manufactured arti- cle that is provided for. I propose to have the Secretary of the Treasury apply his legal mind to the question, and to apply the principle of the axle decision to this article as not being an article unenumerated, partly manufactured. I am sure that I am adrift on the question. Commissioner Oliver. Why is it not, naturally and clearly, covered on the words, “ or parts thereof” ? The Witness. Because I do not think that Congress had in mind an unfinished piece of steel that might be made into a finished oue. I suppose it had the same idea as when it used the words, “ axles or parts of axles.” Commissioner McMahon. My construction of it is as if it read thus : But all articles of steel partially manufactured, or of which steel shall be a compo- nent part, not otherwise provided for — that is, partially manufactured — shall pay the same rate of duty as if wholly manufactured. Commissioner Ambler. That is my construction of it; and it seems a fair construction, too. Commissioner Kenner. These words might be inserted. The Witness. If the words “not otherwise provided for” were out, there would not be any ambiguity about it. Commissioner Ambler. In that case there might be a double duty, simply because partly manufactured articles are provided for in other parts of the schedule. The Witness : Steel blooms we have not spoken of; that is one of the subjects on which we have never been able to satisfy ourselves. The} 7 are now admitted as manufactured articles, 45 per cent , under the authority of an old decision made in 1867 or 1868. We have got into great diffi- culties through that decision. Undoubtedly it would not be made under the present or recent administrations. But we have adhered to it, and the longer we adhere to it the more difficulty we get into on account of it. If it had not been that there have been at least twenty sessions of Congress since that decision was made, and that Congress has not cor- rected it, and that the trade has conformed to it, the department would have reversed it two or three years ago. We have had the same trouble about steel billets. Steel blooms and steel billets are not named in the tariff; and the question is whether they come under the description of manufactured articles, or under some of these other various descriptions. Commissioner Oliver: Would you not suggest, as a way to avoid troubles in the future, that the omnibus clause be made clear by pro- viding that all articles not otherwise provided for shall be taxed at their value according to the average rate of duty in the preceding section? The Witness. They probably were up to the average rate when the tariff* was made. Commissioner Ambler. That is where the trouble comes. The ad- valorem rate becomes less than the sjiecitic duty. You cannot get along with an ad valorem duty and a specific duty, the one varying and the other fixed. The Witness. That is the great difficulty. Commissioner Ambler. Is not the remedy, evidently, to establish a general system of ad valorem duties? The Witness. I should not have pursued this subject so minutely as I have done, if a suggestion, which came to me from one of the Commis- sioners, had not occurred to myself, that is, to furnish the Commission with a list of all disputed questions — every one in each schedule. That, of course, we can do. If you want to learn of the controversies that have 184 TARIFF COMMISSION. [HENRY F. FRENCH. arisen on the wool schedule, I can refer you to a communication signed by your president, and which is in print. In it he points out twelve instances of controversies arising on the wool schedule. I do not be- lieve there would be any difficulty in making up what would be a very useful and very curious document. It can be done at the Treasury De- partment. Commissioner McMahon. That is the best suggestion that I have heard yet. The Witness. If the idea had suggested itself to me before I came here, I might not have tired the Commission with all this talk. Commissioner Oliver. Your talk has been very instructive and very interesting. Commissioner Kenner. I am in the unfortunate position of having made that suggestion. I had written it roughly in the form of a reso- lution, as follows: Resolved , That the Secretary of the Treasury he requested to assign an expert to prepare a list of the ambig'iious aud complex terms used in the present tariff law, to enable the Tariff Commissioners the more readily to correct the complications and errors resulting from those ambiguities. On motion of Commissioner Oliver, the resolution was referred to a committee, consisting of Messrs. Kenner, McMahon, and Ambler. A CUSTOMS COUKT. Long Branch, K. J., Monday , July 31, 1882. In pursuance of the request of the Commission, I shall make some re- marks this morning bearing upon the importance of organizing some sort of a customs court, some sort of a tribunal for the speedy and conclusive decision of customs cases arising from classification. In the course of my remarks the other day , I mentioned to you how nice the questions arising from classifications are; how very difficult of solution; how numerous are the lawsuits arising from disputes of that character; how, for instance, in charges and commissions cases, there were fourteen hun- dred suits arising upon the construction of a single section of the stat- ute, and most of them from the construction of a single clause of the statute. Kow, if for cases of that kind, there were a tribunal that could decide them, whose decision should be final, you would see that a great number of those suits would be prevented. For iustance, take that class of charges and commissions cases where the Secretary had ordered that 2J per cent, be added for commissions, when the law required that the usual commissions should be charged. The courts held after two or three years that that order was void, and that the Secretary could not order more commissions charged than were usual in any case, so that the assessment of 2J per cent, was illegal. Now, if there had been a tri- bunal that could have settled within a week or a month the first case that arose, there would not have been such an accumulation of cases; there might have been a dozen or twenty in the mean time, but there could not have been fourteen hundred cases saddled on the government. In such cases, if the Secretary affirms the decision of the collector, the remedy of the importer then is to bring a suit at law, and that suit must be carried to the Supreme Court of the United States for final decision. So that, in the ordinary course of things, unless the case is made special and brought forward on the Supreme Court docket, there would proba- bly not be a final decision under three or four years. HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 185 I do uot think there is anybody who will not acknowledge the evil that might be avoided by an earlier decision of such cases, which should be final. Even if the importer gains his suit and has the duty refunded to him, the greater part of it must necessarily be expended in the way of lawyers’ fees and for the payment of other necessary expenses. Very many Secretaries of the Treasury have seen the necessity of some more speedy decision of these cases, and have made recommendations looking to that end in their annual reports. I believe every Secretary has made such a recommendation during the time I have been in the Treasury Department (six years). Congress has not acted upon any of those recommendations. After consultation with the Secretary, a circular was drawn up dated 15th of June, 1881, and signed by Secretary Windom. That circular was written by myself, submitted to him for such amendment as he thought proper, and was sent out to the best experts in the country, to the officers of the principal custom-houses, to the gentlemen at the head of manu- facturing establishments, and to the representatives of different indus- tries, asking them what measures they would suggest to remedy the evil. It was also stated in the circular that it was sent only to experts, and that it was hoped it would not be made public for the present, but that when the answers thereto should have been received from the ex- perts, the Secretary, after considering the various suggestions made, would send out another circular, addressed to importers, chambers of commerce, boards of trade, and the like, throughout the country, giving the result in general of those inquiries, and asking them, as they had the greatest interest in the matter, to make their recommendations. As I said, this circular was dated the 15th of June, and sent out. The President was shot on the 2d of July. We received something like seventy-five or eighty replies, giving very valuable information and sug- gestions upon the points. I took them and collated them, and made a care- ful report to Secretary Windom . But there was not sufficient time. Mr. Windom retired from the office betore he had had time to examine iuto the subject, and a new Secretary came in two weeks before the beginning of the session of Congress. Of course hehad no time to attend to it. The result was that the second circular was never sent ; but a bill embodying what was thought to be the best views contained in the replies to the circular was presented to Congress in January. I take the liberty to ask the secretary to read a portion of this circular, omitting what I have marked. The secretary read as follows : Treasury Department, Office of the Secretary, Washington, D. C., Jane 15, 1881. To : Sir: The present method of deciding disputed questions as to the classification of imported merchandise is very cumbrous, expensive, and unsatisfactory. Classification is made by the collector, and if the importer be dissatisfied, he appeals to the Secretary of the Treasury, and if dissatisfied with his decision, may have a trial by court and jury. Nearly eighteen thousand cases of this hind were presented to this Department during Secretary Sherman’s term. Neither the Secretary nor the court or jury pos- sesses any such expert skill as to render their decision satisfactory. * * * All these, and a thousand like them, are questions of classification which may goto the courts for decision. Of what possible value is the opinion of a jury upon questions of this kind? The dockets of the New York courts, where seven-tenths of the tariff cases arise, are so crowded that trials cannot usually bo obtained in less than two or three years, and some classes, as the “ charges and commissions cases,” have remained undecided nearly twenty years. Long before a suit is ended, the importer has closed the transaction, 186 TARIFF COMMISSION. [HENRY F. FRENCH. and lie gains little advantage if successful in his suit. He fails in the chief object, which is to speedily establish a principle which may govern future imports of the same article, and hundreds of appeals accumulate, only for the benefit of attorneys and speculators. To remedy this expense and delay and to give a speedy, final, and satisfactory de- cision is very desirable. Repeated recommendations to Congress have been made by Secretaries of the Treasury that a special court be established in New York for the trial of customs cases. Such a tribunal might give a more speedy trial to cases in that district, but cases would still be subject to the delay incident to all courts of law, and it is desirable that any measure adopted should be applicable not only to New York, but to the whole country. I respectfully ask your advice as to the best method of accomplishing this, and sug- gest for your consideration the adoption of a system similar to that now in use for the appraisal of goods. The appraisal of goods subject to ad valorem duty has for more than forty years been made by the appraising officers of customs, with an appeal, either to two merchant appraisers or one merchant appraiser and one general appraiser, whose decision, if they agree, is final, with the provision that if they disagree the collector shall decide between them. The decision thus made, if the proceedings be regular, is absolutely conclusive, there beiDg no appeal either to the Secretary or to a court and jury. The question as to the constitutionality of this course need not be considered, as it has been settled affirmatively by the Supreme Court. Mr. Justice Clifford, of that court, has recommended to members of the bar that this method should, by proper legislation, be made to apply as well to classification as to appraisal. Whether this precise method by merchant appraisers, or some modification of it, as by an established board of arbitration, shall be adopted is a question to be considered. The number of general appraisers might be increased so that the board might consist entirely of them; or a special board, composed of merchants, might be constituted in each of the principal cities; or, as now, a board partly of merchants and partly of government officials, may be deemed best. Objection may be made that government officials would be partial to the government in their decisions. But statistics given by General Ketchum, the general appraiser at New York, who has held the largest number of reappraisals, show that in nearly all the cases before him and the merchant appraisers they have agreed in their judgment. For instance, in 347 cases of advancement ujion reappraisals of silks, silk and cotton goods, velvets, and gloves, held iu New York in the sixteen months preceding Septem- ber 17, 1879, the general appraiser and merchant appraiser entirely agreed in 331, and differed only in 1(3 cases. And in all these 16 cases, except five, the merchant appraiser agreed that some advance should be made, and differed with the general appraiser only as to the amount of advance. The proposed system would leave for appeal to the Secretary and to the courts — First. The class of cases in which there is alleged to be some illegality iu the pro- ceedings, as where fraud, error, or mistake is charged in the execution of the duties of the customs officer. Cases of this kind occur where some statutory requirement has not been complied with, as by omission of the proper oath, or omission to examine goods, or an appointment of an improper person as appraiser, or similar unjust and arbitrary exercise of power by the customs officers. Secondly. It might be well to provide some mode by which mere questions of law, which control classification, might be carried to the courts for decision. Whether an old statute is repealed by a new one; when a new statute goes into effect; whether a provision of the Revised Statutes repeals a former statute — these, and many other ques- tions arising upon the construction of statutes, might be in some way referred to the courts. Any reference, however, to the courts is attended with a delay which must, iu the cases referred for their consideration, defeat the main object of the proposed amendment of the law, which is to procure a speedy and conclusive decision of disputed questions. Whether it may not be best to refer to the board of reference the whole matter of law and fact as to the particular entry, leaving them “by all reasonable ways and means iu their power to ascertain, estimate, and appraise,” as provided in section 2900, Revised Statutes, as to the market value, mud conclusively fix the amount of duties to be paid, is worthy of consideration. If this method should be deemed too summary, an appeal from the board to the Secretary upon questions of law might be 'allowed, making the Secretary’s decision thereon final. Again, if in some classes of cases, like those above suggested, the opinion of a court be deemed desirable, the Secretary might be authorized, in his discretion, to refer them to the Supreme Court, or to the Court of Claims, as is now provided in certain cases. Although importers, like all other parties, are inclined to pursue any remedy open to them in the courts to the tribunal of last resort, yet it is believed that the measure proposed will meet the approval of importers in general. It is for their interest, more than for that of anybody else, that they should know, at once and finally, without expensive litigation, what amount of duties are chargeable upon their invoices. HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 187 When this plan has been considered and matured it will he submitted to the cham- bers of commerce and boards of trade, and to importers, and others interested, for their approval . Copies of this letter will be forwarded to a few persons connected with the service, and others deemed to be experts. A free expression of your views as to the expediency of adopting the general idea, and as to any details that may occur to you, as soon as convenient, is requested. Until then it is hoped that the matter will be kept from publication, as a prema- ture discussion will lead to no good result. WILLIAM WINDOM, Secretary. Commissioner McMahon. Will you allow me to comment upon one part of that circular, as to the number of cases — some 1 8 , 000 ? I wish to explain that many of those cases were repetitions; that is, they were simply repeated entries or repeated importations of the same goods. If the collector is in doubt, he decides originally adversely to the im- porter, who submits a protest to the Secretary. If the Secretary sus- tains the collector and decides adversely to the importer, that decision becomes binding upon the collector for all subsequent importations of that article until that decision is reversed by the courts, as was the case in regard to the sugar question. The collector did not in that case favor the construction given by the Secretary, but he had to obey the decision. Consequently there were hundreds of sugar cases on the docket, which go to help make up this large number. That is what I wanted to have understood. The Witness. That is one of the very points in the statement read. The importers are obliged to bring suit after suit in order to protect their rights, if they deem the decision of the Secretary wrong, whereas if a decision could be made conclusively and immediately, there would be no occasion for any great accumulation of cases. I know that this circular was made in perfect good faith, for the in- terest, principally, of the importers. They are the parties who suffer; they are the parties with whom theUnited States has the controversy ; and I desired, and the Secretary desired, that some tribunal should be estab- lished which would relieve the department of the decision of these questions, which we were in no condition to settle properly ; and, in the next place, to give relief to the importer. The gentlemen who have an interest in controversies, who make their living by attending to suits at law and by endeavors to obtain refunds; gentlemen who take suits upon shares (as a great many of them do, called in Washington contingent fees, and considered there perfectly proper, as I presume it is in New York) — those gentlemen immediately arose as one man and said, u Why, this is a new scheme from the Treasury De- partment to wrong the importers.” And the moment the bill was intro- duced by Senator Sherman the scheme was denounced in the New York papers as being a u w scheme of the Treasury, gotten up for the purpose of wronging the importers; whereas, in fact, it was more for their benefit than for that of anybody else; and, instead of being for the purpose of getting more power into the Treasury Department, it was to take from them all the power they had on the subject. They were desirous of getting rid of the controversies, of getting rid of the labor involved in their adjudication. In the discussion that ensued in Congress the whole thing was attributed to some desire to get up some scheme, like the sugar circulars, to wrong the importer in some way, and, in conse- quence, it has not had a fair chance in the discussion. If the subject had remained as it was, perfectly within our control, and we had sent out to the chambers of commerce and importers a circular asking their 188 TARIFF COMMISSION. [lIENEY F. FRENCH. advice, they would have taken it in perfect good faith, and we should have got their advice for some scheme that would benefit them. But, as I said, the whole matter was disturbed by one of those accidents which nobody could prevent, and the difficulty still continues. There are three methods, that were principally suggested in the an- swers made to the circulars, by which these cases could be settled. Oue was to arrange the matter very much as the valuation of goods is set- tled — leave it to the custom-house officers to settle the classification just as they settle the valuation of goods. That was the leading idea, as you will see in the circular. One objection was that, while in New York there is a large number of very able officers from whom a board might be selected, with a merchant appraiser who would be entirely competent to settle such questions, yet in the small x>orts it would be very difficult to find any such officers who would be competent. The importance of having the decision right in the first place, in order to have any binding force, is manifest. For instance, there might come an importation of cotton-ties into New Orleans, or into some small port down South, and the decision there might be that they were to be clas- sified as hoop-iron. If that decision were to be conclusive, it would be a great hardship upon the consumers. On the other hand, if decided to be manufactures of iron, it would be a hardship on those who desired protection. So that that plan was not insisted on. It seems to me it would be hardly safe to say we could find officers in the custom- houses of the ports outside of New York, Boston, Philadelphia, and Baltimore who would be competent to give a conclusive decision. And any tribunal that does not give a final decision is not of any value, be- cause one of the very things we want to avoid is the multiplicity of appeals. On the whole, I am inclined to think that we could not carry out that idea, and if I had prepared another circular on the subject, I should have said so. The next proposition which seemed to have the most support, and the one which I should adopt, if it is deemed expedient, though I am not very urgent on this point, would be the creation of what might be called a customs court, composed partly of experts, and with one or two law- yers of eminence, who should be judges learned in the law, but made up mainly of experts, who should receive salaries of five or six thousand dollars or more per year, and whose appointments should be permanent. That court might sit in New York. But immediately men at the other ports would say, “Why not sit in Boston, or Chicago, or Baltimore'?” and so on. There would be no insuperable objection to having the court constituted with power to sit in different places. It might remove, if necessary, to Boston or Philadelphia. I mention New York as the headquarters, because the larger number of controversies arise there, It would be no greater hardship, however, to send all the cases to New York than it is to send them to Washington, where they now go. Nobody who has made that objection seems to have thought that every- body is obliged to go to the Secretary of the Treasury now with his appeal, and in the end is obliged to go to the Supreme Court at Wash- ington to have a final decision. One of the members of the proposed court might be detailed, when the importance of the cases warranted, to sit at the other ports and collate the facts, collect the evidence, take it in writing, and report it to the full court. In most cases there is no great difficulty after the case has been fairly examined. The difficulty generally arises from misapprehension rather than from settled difference of opinion where the case has been HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 189 examined by competent experts. So that practically there is no great difficulty, in establishing such a court. Such a court would be the very best tribunal for investigating the matter, and its decisions would be final. I would have no appeal whatever to any other court. With all due deference to the Supreme Court of the United States, or to any court higher than the ordinary courts, the opinion of such a court upon a mixed question of law and fact involving such transactions would be better than the opinion of the Supreme Court would be. Such a board of experts, giving their attention wholly to that class of business, would, in a very short time, be regarded by everybody as better able to finally settle such questions than any other tribunal whatever. I do not think there is any difficulty upon that point. Commissioner McMahon. Would you retain the protest? The Witness. I think the value of the protest, if properly regarded, is very great. The importer brings in his goods. They are examined hastily, as they must be, and classified. The appraising officers report to the collector’s office, and the classification is made. The importer says, “You have made a mistake about that, and I want it corrected.” He files his protest, stating the difficulty. Now, I hold, and the depart- ment now holds, that the collector, having received that protest, is not only at liberty but is bound to make a re-examination and see if there has been a mistake. In New York they have officers who can care- fully examine such questions, and if the collector finds that he has made a mistake he will correct it. If that is satisfactory to the importer, that ends it. I would not have the protest disregarded or regarded as a mere matter of form, as it has been in many ports until lately. The courts have said repeatedly, in adjudicating upon the question as to whether a protest was sufficient, that the object of the protest is, in the first place, to enable the collector to correct his mistake, if he has made one ; in the next place, that the importer shall not change his ground when he comes into court; he shall make it so definite as to show the real point of complaint, and shall not afterwards change it when he goes beyond the custom-house or into the courts. Commissioner Underwood. The protest supplies the place of plead- ings in the courts of law, and the party making the protest must be held to the case he makes in his protest. The Witness. That is it; it forms the issue directly. But I merely referred to it because the courts have repeatedly said that one object of having a protest wa's to enable the collector to correct his mistake if he lias made one. The only practical objection to having such a court of arbitrators — if you may call it such — or customs court, is that there would not be busi- ness enough to occupy it. While Congress can appropriate $19,000,000 to the improvement of all the creeks and mud-puddles in the country, when it comes to a question of appropriating $30,000 or $40,000 to settle thousands of controversies, the question of economy at once comes up. They say, “This is going to be an expensive court. Five or six judges with salaries of $5,000 or $0,000 a year each, and the expense of all the attendants upon the court amounts to a great deal.” Economy is always to be considered; but the only question in my mind in that direction is this: Would there be enough business to occupy the time of such a tribunal? If such a court could be constituted whose decision should be final, it would very greatly lessen the number of suits involving the same points, because if you settle the first, the other three thousand or three hun- dred would not arise. And I am not sure that there would be a very large amount of business for such a court. Every time there is an 190 TARIFF COMMISSION. [henry f. french. amendment of the tariff law there is a crop of lawsuits grows out of it. I am trying here to occupy the position I always have occupied in this matter, that of perfect impartiality and a desire to hit upon a scheme that shall best accomplish the two objects of a speedy decision and a right decision. A bill is now pending before Congress to refer this class of appeals to the Court of Claims. The Court of Claims consists of five judges, who try cases without juries ; who practically sit to hear the facts and decide the law. All the evidence is embodied in printed statements. The judges in the first place have to agree upou a statement of facts, and then they decide upon the law. That tribunal now sits only in Washington, and upon inquiry made by the Treasury Department of that court, the judges unanimously signed a statement to the effect that they could, without any doubt, fairly transact all the business that could arise upon these appeals in addition to their present duties. That court has in it one judge (Bichardson) who was Secretary of the Treasury for a time, and previously to that was Assistant Secretary for several years. He has been engaged in the compilation of the statutes, and has published a supplement thereto. He is as learned in that kind of law as any man in the country. The other judges are not perhaps particularly skilled in customs laws; they would not be regarded as experts in any of these cases; but the court is certainly a very respect- able one, and has the confidence of the community. An argument in favor of transferriug the business to that court is, that there would be no new officers to be created, no increase of salaries, no increase of expense of any description. The objection was at once made that the Court of Claims sat only in Washington. This could easily be remedied by providing that the court may, in their discretion, sit in any of the ports of the country. Commissioner Oliver. Either Boston, New York, Philadelphia, or Baltimore. The Witness. Another argument for the Court of Claims is, that the Attorney- General and his officers could attend to the cases in Washing- ton, before the Court of Claims there, and that the United States attor- neys, in the other cities where the trials were held, might attend to the interests of the United States there. I have suggested all the views that occur to me now on this subject. I have no papers here, and have spoken entirely from memory; but I have suggested the various claims of different kinds of tribunals, and it seems to me a very important matter (if my personal opinion is of any value) that, in your final report, you should consider this matter, unless Congress shall before that time have passed the Court of Claims bill, and have made some definite provision on the subject. DUTIES ON SUGAR. Some members of the Commission have asked me to give a littlestate- ment as to the present condition of the sugar question, and I will go on if agreeable. I do not propose to discuss the subject at much length, but, as the question has gone over the present session of Congress (evi- dently for the reason that it is before this Commission), it is very im- portant that you should take some action upon it. I think a fair statement of the condition of things under the law will satisfy you that there is no item of the tariff which more imperatively demands attention than this of the duties on sugar, and I will run it over so that you may have a general idea of how the question stands. Many of you are already familiar with it. HENRY F. FRENCH.] AMBIGUITIES OF THE TAEIFF. 191 Many years ago what is called the Dutch standard of color was adopted for the classification of sugar. The general theory was — and it was correct — that the lighter the color of sugar the purer sugar it was and the more valuable ; and this Dutch standard was based upon that idea — that the value ranged somewhat in proportion to the color. That theory worked very well until the centrifugal process was adopted. A few years ago it was found that sugars were brought into the mar- ket which were very pure, but which were of very dark color, and it was soon ascertained to the satisfaction of the Treasury Department, al- though it was denied by the importers and by the sugar manufacturers, that those sugars were artificially colored for the American market. Commissioner McMahon. And will you add in that statement “and by the customs experts in many cases’ 7 ? The Witness. Not universally. I think they are very nearly all of them now satisfied beyond question that the sugars were artificially col- ored. I think Mr. McMahon will not say that any officer of the custom- house believes that any sugars that tested 98 and rated at No. 7 (the low- est Dutch standard) were not artificially prepared for the American market. It was not denied in the argument of The case by Mr. Evarts. Commissioner McMahon. The sugar experts in the custom-house^ held that there was no introduction of foreign substances. Commissioner Kenner. The experts of New Orleans held a directly opposite opinion — that those sugars were discolored for the American market. Commissioner Ambler. The question is what they were colored with ; molasses is not a foreign substance. Commissioner McMahon. It was a regular process of manufacture, but our customs experts held that there was no introduction of foreign substances. If there had been then it would have been something more than sugar — it would have been sugar and something else. The Witness. The important point is, that about 1878 or 1879, the Dutch standard of color became an entirely inadequate and false stand- ard. It did not do what Congress intended it should do. It did not disclose the true value of sugar for all practical purposes, but was en- tirely misleading and making the high-priced sugars pay only the lowest duty, which was never intended by anybody, and was not defended by anybody. It was intended that it should pay something like an ad va- lorem duty. The department became satisfied that those sugars were artificially colored, as we all think, and as the evidence shows, colored by pumping molasses into the vacuum pan where they were boiling, after they had been reduced to granulated sugar, and which, in the ordinary process, would bring a good deal of it up to 16 Dutch standard; that after it had become sugar, to all intents and purposes, they pumped in black molasses which had been throw r n off by the centrifugal, and which was never used or intended to be used in the manufacture of sugar, any more than so much blacking would be, and which practically never was used for making sugar. That stuff pumped back was just as much, in my view, a foreign substance as if it had been a quantity of blacking pumped back into the vacuum pan, or sent back by the force of suc- tion, and the sugar colored as black as they wanted to make it. Then the sugar w r as passed through the centrifugal without any water to wash it, and was sent here and was said to be, say, No. 7, D. S., and claimed to pay that duty. It was regarded by the department and by near y all the custom-houses as a fraud upon our revenues; or, in other words, the department held that we were bound to regard the true color of the sugar and not the apparent color. The New York custom-house 192 TARIFF COMMISSION. [HENRY F. FRENCH. took the ground that they had a right to do what they chose with the sugar. Commissioner McMahon. Allow me to say that we held also that if it was a fraud, as you say, you should have seized the sugar and for- feited it. The Witness. I do not care particularly about discussing the New York custom-house here. Commissioner McMahon. I do not want you to put the New York custom house in a false position. The Witness. The New York custom-house is just the same to me as any other custom house in the country, and I will protect and defend it and its collectors, with whom I have always had friendly intercourse, as soon as anybody else. I should not have had anything to say about it and did not allude to it until Mr. McMahon thought proper to intro- duce the subject. The responsibility is, of course, upon the Treasury Department. We said this: We had to regard the true color of the sugar. This black sugar ground in a mortar was nearly white ; the color was all on the outside of the grains. We showed it repeatedly before the committees of Congress and everywhere else. We said that was not the true color. If I agree to sell a man a pair of white horses, and bring him a pair of black horses with a coat of whitewash over them, he will not be bound to receive them as white horses. They are not white horses. They are merely a pair of black horses disguised. So we held in regard to the sugar j this apparent color was not the true color, and we contended that we had the right to ascertain the true color, either by pulverizing it in a mortar, or by examining it otherwise, to see what its true color was. We know that in the ordinary processes of manufacturing sugar, color, as I said, is a fair index of purity. These sugars were dark. We tested them by the polariscope and by chemical analysis to find their saccharine strength. We found, for instance, that a sugar that was entered as No. 7 and was darker than any No. 7, would test 98 or 99 per per cent, pure sugar, while the true No. 7, made by the ordinary pro- cess, would only test from 65 to 75. We saw that this was a fraud upon honorable importers who did not care to engage in any trick of that kind, for it is a trick. It was a fraud on the producers of this country who had a right to the protection of the law so long as the law stands. We undertook to look through the disguises and assess the sugar upon its real color and not its apparent color. We never claimed any right to do anything except to assess by the Dutch standard of color. To ascertain that color we removed the disguises either by washing (which we could do at once)— put some in a tumbler and stir it, or put it in a mortar and grind it and bring out the true color ; or, again, test it by the polariscope, and that would disclose exactly what the true character of the sugar was. And now a word as to the polariscope. That we know is a modern instrument, made for ascertaining various matters, and used very gen- erally for ascertaining the value and quality of sugar. It is an instru- ment, I may say, in universal use among all the buyers and sellers of centrifugal sugars, as the test of its value. In the New York Times of this morning 1 find the quotations of the Havana market stated thus : Havana, July 29. — Sugar — The market lias continued inactive for want of sellers, but prices were linn ; molasses sugar, 84° to 87° polarization, G$ © 6£ reals, gold, per arroba; Muscovado, common to fair, (if © 7f reals; centrifugal, 92° to 96° polariza- tion, in boxes and hogsheads, 8f © 9f reals. HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 193 That is in all the reports of prices of sugar in foreign markets. The polariscope is used, as I said, by the buyer. He makes his orders with reference to that test, and the whole trade adopts it as the just criterion of value. It has nothing to do with the Dutch standard. They do not care what the color is. It is the purity of the sugar which they regard. Mr. Kenner knows all about this, and will substantiate what I say about the use of it in this country. I understand that sugar in New Orleans is bought and sold by this test. The polariscope is used uni- versally in the sugar business at the South, and nothing else is used as a test. Gentlemen say in Congress and out of Congress that the polariscope is an instrument that the custom-house folks cannot use; that it is an instrument of fraud, and that the government should not undertake to use it. There has been great objection from some sugar importers to its adoption. The objection does not arise from the fact that the people who deal in sugar do not know that the instrument is universally used as a test, but it arises ordinarily from the want of agreement among the various classes of persons interested in sugar as to how the tariff shall be established. At present the tariff is pretty nearly uniform ; that is, the high sugars may come in, and a good many of them do come in, at a low rate of duty, and that is favorable to a good many persons inter- ested in sugar. I have attended all the meetings, or at least I have generally attended the meetings, of the Ways and Means Committee, when the Treasury was invited to be present, end there lias never been a time when the parties interested in refining sugar and importing it, have tendered to that committee any agreement as to the best mode of classifying sugar. They have been asked to do so repeatedly. When they came before the committee the chairman has said: u This is a legis- lative committee, gentlemen. You are here to help us to legislate. Have you agreed upon any basis upon which you will have sugar clas- sified and the tariff fixed?” And in every instance they have been unable to answer in the affirmative. One gentleman would contend that there should be two rates, those below the No. 13, Dutch standard, and those above No. 13. That would not be a difficult matter to manage. Some of the others have wanted the polariscope used, but they were persons who did not agree with the first class as to how they wanted the duties arranged. It would be a very simple matter to say: Retain the present rates, or reduce them 25 per cent, if you think proper; and it would be a very simple matter to say that the various classes or grades should'be tested by the polariscope; there is no difficulty about executing that at all. An ad valorem duty can be very easily levied and collected. I presume at the present time more people would agree to an ad valorem than any other. There is something about the polariscope that acts like a scare crow upon some people. Two or three years ago there was some doubt whether it was an accurate instrument, but I think now everybody who deals in sugars uses the polariscope as a test. If you assess an ad valo- rem duty the polariscope would be the instrument to ascertain the value of the sugar. It does not make any difference to the department or to anybody else how these duties are arranged. If it is intended to get anything like a graduated scale of duties the polariscope must come in to determine the value. You have two questions before you. One is whether you will raise or lessen the tariff upon sugar, or preserve it as it is. The other is how you will grade it, and how you will ascertain the value of different sugars. My suggestions are intended merely to give you the n. Mis. 0 13 194 TARIFF COMMISSION. [HENRY F. FRENCH. present status of the question, and to make some suggestions as to the proper mode of establishing the tariff upon sugar. Sugar now pays the largest amount of duties upon the schedule. We have not the amount paid for the fiscal year ending June 30, 1882, but for the year ending June 30, 1881, the amount of duty on sugar was $48,000,000. I believe there was something over $50,000,000 this year. Commissioner McMahon. We have it to March, 1882, that is all. The Witness. In 1875 there was a duty of 25 per cent, added to sugar, and there has been a proposition in Congress — which has been decided by the postponement of the bill — to take off 25 per cent., which would be a reduction of 20 per cent., and that would reduce the tariff if it is $50,000,000 to $40,000,000. I have nothing to say upon this point or any other, as to the propriety or impropriety of any such measure; it is not my province ; 1 am not an advocate for anybody, and in fact I do not care about it. My whole mission here is to suggest to the Com- mission the points of difficulty in administering the law so that you may avoid difficulties when you come to make your final report. That is all, Mr. President, I have to submit. Commissioner Boteler. Do I understand you to say that the polari- scope should be relied upon to ascertain the saccharine strength of all sugars The Witness. Yes. I ought to say that when the question of appar- ent color with reference to the assessment of duties by the department went to the Supreme Court, that court decided that the introduction of coloring matter in the way I have suggested — and that was proposed to be proved and expressly relied upon — although it was done to evade the tariff, was not such a fraud as to authorize the Treasury Depart- ment to look at anything but the apparent color of the sugar as it was imported. So that at present any man has a right, in the course of manufacturing his sugar — though not by any process for making the best sugar in the shortest time and cheapest way — to introduce any coloring matter for the very purpose of reducing the duty on sugar, or, as Mr. Evarts expressed it, to meet the American tariff, and the duties cannot be assessed in any way except upon the apparent color. To the opinion of the Supreme Court I bow with profound respect, only reserving the right to agree with the minority, which is, of course, no more disrespectful to the majority than it is disrespectful for the minority of the judges to disagree with the majority. There were two judges who entertained an entirely different view of the matter, and took the ground that the department took upon the subject. They published a dissenting opinion which can be furnished to you with the opinion of the majority; they are published together. I have only to say that with that minority I entirely agree. The law is to be executed precisely as the Supreme Court determined, and I think I will add one statement in that regard. Of course the department is criticized in all directions, and that is all perfectly proper. It has been stated by way of criticism that this deci- sion of the Supreme Court has cost the government an immense amount of money. There is no loss to the government. The government is only refunding the money which was wrongfully taken according to the decision of the Supreme Court. The Treasury has not suffered at all by the process. The importers may have suffered. By reason of the careful attention given in the course of the controversy which arose as to the grading of sugar and the assessment of duties, it appears that the revenue from sugar during the two or three years while that deci- sion of the Treasury Department was in force was increased something HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF 195 like five million dollars by the higher classification in cases where no controversy arose in regard to the use of the polariscope. So that, in fact, after striking a balance in regard to the whole controversy, I think the government has collected several millions more money than if the controversy had not arisen, even after refunding what was declared to have been illegally collected. The statistics upon which I rely are the reports of the special agents. I refer to the actual duties and not the estimated duties. It has been noticed in Congress that there is a differ- ence between the Bureau of Statistics and the figures in the Secretary’s report, and it has been a great puzzle. Commissioner MOMahon. The liquidated duties were much less. The. Witness. That is all, gentlemen, I have to say. Commissioner Oliver. In connection with the matter as to wdiich Judge French has been speaking — the establishment of a tribunal for the adjudication of customs cases — we have had sent to us a communi- cation from Senator Sherman to Judge Richardson, of the Court of Claims, and Judge Richardson’s reply thereto, together with a copy of the bill reported by Senator Morrill which, as I see by a memorandum, includes or covers the Sherman bill. The matter is now r before the Commission, and the correspondence and bill can be read if desired. The President. The papers will be read if there is no objection. Commissioner Oliver then read the following papers : Correspondence in relation to the best method of determining controverted questions in cus- toms-revenue cases. Senate Library Committee, Washington, December 19, 1881. Hon. Wm. A. Richardson, Washington , D. C.: Sir: My experience in tlie Treasury convinced me of the great importance, both to the United States and to private litigants, of the organization of a tribunal to try customs cases, or of transferring jurisdiction in such cases to the Court of Claims. Your experience as Secretary of the Treasury and Assistant Secretary, together with your experience as a judge of the Court of Claims, will enable you to give to Congress important information, both as to the necessity of such a tribunal and the best mode of securing it. Referring to our recent conversation, I respectfully ask you to state in writing your views upon the subject in such form as may be available for use in Congress. Very truly yours, JOHN SHERMAN. Chambers of the Court of Claims, Washington, D. C., December 23, 1881. Hon. John Sherman, United States Senator : My Dear Sir: You do me the honor, in your letter of the 19th instant, of asking me to state in writing my views upon the subject of making some better provision for the hearing and determination of appeals from collectors of customs and other cus- toms officers, in customs-revenue cases, than now exist under the present system. I have thought much on the subject during the past eleven or twelve years. I was convinced, while in the Treasury Department, from my five years’ experience there, as you say you were from your experience as Secretary of the Treasury, that it was of great importance both to the United States and to private litigants that something should be done for the relief of the department, the courts, and the parties interested. Further reflection during the more than seven years that I have been in this court has confirmed that conviction. The existing evils are numerous, and the plan proposed by the bill introduced by you in the Senate affords an easy remedy and complete re- lief. Under the existing system, if an importer is dissatisfied with the rate and amount of duty assessed by a collector upon any importation, ho must, within ninety days, appeal to the Secretary of the Treasury. Practically, such an appeal is to the Treas- ury Department, and is generally heard by the head of the customs division, or an 196 TARIFF COMMISSION. [HENRY f. french. Assistant Secretary, since it would be utterly impossible for the Secretary himself, with all his other numerous and important duties pressing upon him, to give personal attention to the thousands of appeals that reach the department every year from the collectors of customs. If tc-e importer desires a hearing on his appfeal, he must come to Washington with his witnesses, and first submit his case to the Treasury officials. They are executive and not judicial officers, and do not have the same facilities and safeguards for the trial of cases that mark and distinguish the proceedings in courts of justice; the hearing is entirely ex parie. It is always unsatisfactory to try controverted questions of law or fact before executive officers, and none feel the embarrassment more than do those officers themselves. As a general proposition, no one would deny that, as far as practicable, executive officers should be relieved from the duty of determining controversies which involve disputed questions of fact or law. But that the importer must first try his case before executive officers, at considera- ble expense and delay, is perhaps the least of the difficulties to which he may be sub- jected. If he is dissatisfied with the decision of the Treasury Department he may bring his action, within ninety days, against the collector, in the circuit court of the United States, or in a State court, as the case may be. Or, if the department delays a decision beyond ninety days, then he may bring his action without waiting longer for the department to act. To a large extent the courts are thus resorted to, more for the purpose of settling questions of construction of the revenue laws as applied to particular classes of im- portation than to recover back the money paid in the particular cases themselves, in order that importers and domestic manufacturers may know for a certainty to what rate of duty the goods are to be subjected in the future. Speedy trials and uniformity of decisions are. therefore, of the first importance. Under the present system they have neither. It is well known' that the courts in which this class of cases are tried are crowded with business, and are three or four years behind in their dockets, with several thou- sand customs-revenue cases still pending. Then, if either party carries a case to the Supreme Court of the United States after a final hearing and decision in the circuit court, there is another delay of several, often making seven or eight years in all. The several revenue cases decided by the Supreme Court in 1881, and reported in 103 United States Reports, were brought against Chester A. Arthur, now President, when he was collector, upon importations made in 1873, nearly eight years after the impor- tation ; and the Jong delay in those cases was not exceptional. During all this time counsel have to be employed and the taxable cost is accumulating. When the case is finally determined by the court of last resort, the losing party is subjected to a bill of cost frequently greater than the amount of duties which is in controversy. Moreover, after this long delay, the class of goods to which the case relates may no longer be imported in precisely the same condition of manufacture, and the judgment and de- cision finally rendered may therefore be of no benefit as a precedent. But the objec- tions to the present system do not end here. Uncertainty of results, controlled as they may be by technicalities of judicial proceedings in the courts of common law, by the hurry of jury trials, by accidents incident thereto, and by the success which one party or the other may have in obtaining witnesses to appear in open court on the very day of trial. In controversies between individuals the public has no interest, nor have any per- sons any special interest therein besides the litigants themselves. Not so in the customs-revenue cases. In them, all importers and all domestic man- ufacturers of the same articles are deeply interested, as the results, if followed as pre- cedents, directly affect their business. And yet they have little or no means of know- ing what questions are in litigation beyond those which are involved in their own cases in court. Moreover, the general public, who are purchasers and consumers of imported goods, are not only interested in the rate of duties charged, but are among the actual sufferers by the present uncertainty and delay. If the collector exacts the highest rate of duty upon any class of goods, the importer adds it to the cost of the goods, and the con- sumers pay it. If he brings his action to recover back an excess alleged to have been imposed by the collector, and is successful, the amount recovered does not go to the consumers who actually paid it, but to the importer as additional profit. There are a large number of courts in which these actions are brought, and they are in different parts of the country, widely separated. Experience has shown that their decisions are not the same in the different courts on precisely the same questions. Not only that, but instances have occurred in which two cases exactly alike, in the same court, have been submitted to different juries, at the same term, with opposite rcMilts in the verdicts. Often one importer recovers back the money paid by him, while another does not, in cases exactly alike In such cases no principle is settled by the verdict of a jury. Importers and manufacturers in New York are unaware of the cases HENRY F. FRENCH.] AMBIGUITIES OF THE TARIFF. 197 and questions pending in New Orleans and San Francisco, as are tlie importers and manufacturers of every State unaware of the. pending cases in other States; and they may he affected by decisions, if followed as precedents, in cases which they had no control over, and which may have been badly tried and inconsiderately decided. The remedy proposed is simple, inexpensive, and requiring no new organization. It merely transfers the duties, in part, from one set of public officials to other public officials, with no additional cost, and with great reduction in expenses, both to the government and to importers, and at the same time affords relief to the common-law courts, which are overwhelmed with business. It is not all appeals that the parties desire to litigate in the courts. Many of them are unimportant, either in the amount involved or the questions raised. These may well be settled in the Treasury Department, as now.* So your bill proposes to give to parties the option, when taking their appeals, to appeal either to the department or to the Court of Claims. If they appeal to the de- partment, they are to be bound by the decisions there rendered, and no further litiga- tion is to be had thereon. If they have important and complicated questions of fact and of law to be litigated, and desire the judgment of a court thereon, they will appeal directly to the Court of Claims, instead of bringing suit in the circuit court, or in a State court, against the collector. The collector has no interest in the matter, and is merely a nominal defend- ant. The controversies are really with the United States. By the method proposed the cases actually intended for trial in a court of law — cases involving important principles — will be separated from the ordinary appeals, and taken at once to the court for adjudication without the expense and delay of a preliminary hearing in the department ; and thus speedy trials will be had and early adjudication obtained. The Court of Claims is organized for the express purpose of trying cases against the government, or, more properly speaking, in the language of the act of its organiza- tion, “ for the investigation of claims against the United States.” In one of the circu- lar letters issued by you when Secretary of the Treasury, it is thus referred to : “ The Treasury Department is admirably organized to pass upon accruing demands upon the government and upon the accounts of disbursing officers. All its machinery and checks are adapted to this duty, and no serious complaint has been or is likely to he made of the proper discharge of this duty. But when claims long past due are presented upon ex parte evidence to officers who have no means of calling witnesses, no powers to cross-examine them, no modes of testing the sufficiency of testimony or its credibility, none of the safeguards of an open court of justice, the passage of fraudulent claims is unavoidable. Congress has by law provided a Court of Claims, where, within a limited period, all demands founded upon contracts may be pre- sented and openly tried and decided. If this remedy in any case should be insufficient, claimants can appeal to Congress, which may grant either a new trial in the courts, or a re-examination in the departments, or directly furnish such relief as it deems right and proper. The Treasury Department is not a Court of Claims, and the reason for withholding the ordinary powers of such a court became apparent to Congress by actual errors that had occurred.” There can be no doubt that the Court of Claims is peculiarly fitted for the investi- gation and determination of customs-revenue cases. It is composed of live judges whose whole time is devoted to the study and consideration of the statutes and laws of the United States. The judges all sit in each trial, so that the minds of all are brought to the independ- ent consideration of each case and each question raised, and the law expressly requires the concurrence of at least three judges lor the entry of any judgment. The investigations are conducted with great deliberation and thoroughness. There is no jury, and cases are not subject to the accidents and uncertainties of jury trials. Parties are not turned out of court on technicalities which further time would, enable them to remedy, but the court endeavors to have the cases investigated on their merits. All the testimony is taken in writing and printed, and is open to the exami- nation of not only the litigating parties while the cases are in preparation, but to that of all oth6r persons who may be interested in the questions involved. Thus importers and domestic manufacturers could easily know of every pending case affecting their interests, and exactly what testimony was introduced in each. The cases being all in one court, anti all the proceedings being in print, it would not be difficult to keep the run of the whole business. The court, after the trial, draws up carefully-prepared “findings of facts,” and gives an elaborate opinion upon the law. These findings and opinions are printed at once for distribution to persons interested, and are published in volumes of reports for per- * The chamber of commerce bill, which accomplishes the same result, has been sub- stituted, by agreement of all parties concerned, for the Sherman bill, and has been reported by Senator Morrill. 198 TARIFF COMMISSION [HENBY F. FRENCH. manent preservation as precedents. In a short time these reports would contain an invaluable collection of customs-revenue cases which would be certain guides. The decisions being rendered all by the same court there would be uniformity and cer- tainty, which are, above all things, desirable in the administration of the law ; for, as was said by Sir Edward Coke two hundred years ago, u the known certainty of the law is the safety of all.” It may be said that parties from distant parts of the country would be compelled to go a long way to try their cases, but that will prove to be no objection when it is known how the business is conducted in the Court of Claims. Parties and witnesses are not required to appear before the court, and counsel, even, may never be there in person, and yet may conduct their cases from beginning to end. Let us take a case and follow it. An appeal is taken to the Court of Claims from the collector of the port of New York. The appeal may be forwarded to Washington by mail, with a peti- tion setting out the particulars as now required by law ; and it is entered on the docket by the clerk. No fees are to be paid and no costs are taxed from the beginning to the end. Parties go on in New York, or elsewhere, and take the depositions of such witnesses as they wish to examine. This they do at their leisure, from time to time, as opportunity and convenience permit. Each party has an opportunity to cross-ex- amine all the witnesses of the other party. When the claimant has his case prepared to his satisfaction, and the defendants have, iu like manner, put in their evidence — which the claimant has all the time he desires to examine and to answer — he puts the case ou the trial docket by letter to the clerk. The court will, if requested to do so, fix a day for trial according to the wishes of distant counsel, so that they can go to Washington and try their case, or rather argue their case orally with no loss of time. Or counsel can file a printed argument, and so not leave their office at all, and not once go to Washington from the inception to the close of the case. If the claimant’s case is lost, he is not mulcted in a bill of cost, as in courts of com- mon law, and the whole proceedings he will find, whether he wins or loses his case, are attended with far less exxieuse than are ordinary suits at law. If parties should deem it desirable, the court might be required or permitted to sit in New York, Philadelphia, or elsewhere, at stated periods, or in special cases. To the government the plan proposed would be as advantageous as it would be to individuals. The Treasury Department would be relieved from a troublesome class of cases, which often involve its officers in disagreeable controversies and collisions with importers, manufacturers, and others, and subject them to unfair criticisms and unjust imputations. It would save the enormous expense now incurred i.n the trial of cases in different circuit courts of the United States, amounting to more than one hundred thousand dollars a year, and it would bring all the cases into the office of the Attorney-General at Washington, where they would be prepared under the imme- diate supervision of the Attorney-General and his assistants, with the aid of the Soli- citor of the Treasury and other officers of the Treasury Department familiar with the question to be tried. While I am quite sure that the bill which you have introduced, if enacted into a law, would establish an admirable system, which would work easily, inexpensively, and satisfactorily, I am aware that amendments in the details may readily be suggested to meet the different impressions of different persons, and to such it would be well to yield a ready assent, in order that the views of as many persons as possible may be adopted, provided the main features of the bill are not undermined. I am, very respectfully, your obedient servant, WILLIAM A. RICHARDSON. In the Senate of the United States, June 20, 1882. Mr. Morrill, from the Committee on Finance, reported the following bill; which was read the first and second times by unanimous consent. A BILL to provide a better system for the trial of customs-revenue cases. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the appeals provided for by sections 2931 and 2932 of the Re- vised Statutes maybe made by the appellant, at his election, either to the Secretary of the Treasury or to the Court of Claims, to be there proceeded'with, determined, and disposed of as suits against the United States; and so much of said sections as relates to bringing suits for the recovery of duties alleged to have been erroneously or illegally exacted is hereby repealed. Sec. 2. That every appellant to the Court of Claims shall enter his appeal in said court within thirty days after the taking thereof, by filing a petition iu writing against the United States, setting out the facts and giving the name of the importer or im- porters, the description of the merchandise and place from which imported, the uame HENRY F. FRENCH. | AMBIGUITIES OF THE TARIFF. 199 of the vessel or means of importation, the date of the invoice, the date of the entry at the custom-house, the precise amount of duty or moneys claimed to have been exacted in excess, the date of payment thereof, the day and year on which protest was tiled against such exactions, and the date of appeal thereon, and otherwise complying with the rules of said court. Sec. 3. That, except as hereinafter provided, the said Court of Claims shall have the same power, proceed in the same manner, and be governed by the same rules in respect to the mode of hearing, adjudication, and determination of said appeals as it now has in relation to the adjudication of claims against the United States; but said court may make such other and additional rules as may be necessary to save costs and prevent delays in the prosecutions of such appeals. All laws relating to prosecutions of claims against the United States in said court shall apply, as far as applicable, to the prosecutiou, practice, hearing, and determinations of appeals under this act : Pro- vided , That in,the trial of such appeals no person shall be excluded as a witness be^ cause he or she is a party to or interested in the same. Sec. 4. That on motion of the plaintiff in any action now pending against any col- lector of customs or other customs officers in customs-revenue cases, of like kind to those herein described in any circuit court of the United States, said court shall, by order m writing, transfer said case, with all the papers therein, to said Court of Claims, to be proceeded with, heard, determined, and disposed of as an action against the United States in like manner as appeals made directly to said court under this act. Unless such motion shall be made, any such case now pending in the circuit court may be tried and prosecuted to final judgment, notwithstanding the repeal of the statutes applicable thereto by this act. Sec. 5. That the Secretary of the Treasury shall, on request of any appellant, and may on his own motion, by order in writing, transfer to' the Court of Claims any ap- peal heretofore or hereafter made to him in customs-revenue matters of like kind to those herein described, with all the papers and documents filed therein, or certified copies thereof, to be proceeded with under the rules of sa*:d court in the same manner as 1 hough said appeals were taken originally to said court after the passage of this act. Sec. 6. That whenever, within such time as the court shall by general rule pre- scribe, the appellant files a written request therefor, the trial shall be had at New York, Philadelphia, Boston, or Baltimore, in whichever of said ports the case may have originated, and the proceedings thereon shall be as follows : A single judge of said court shall proceed to the port where said case originated, and with two assessors, one to be appointed by the collector of the port and the other by the appellant, shall hear the parties upon oral evidence. The assessors shall take and subscribe an oath that they are not interested in the matter in controversy, nor in the question involved therein, and that they will faith- fully and impartially discharge the duties imposed upon them. Each assessor shall be paid five dollars a day for his services out of the public treasury, upon the certificate of the judge. The judge shall draw up in writing findings of fact, in accordance with the opinion of the majority of the three, and shall add his conclusions of law thereon. The find- ings of fact and conclusions of law thus found shall be filed in the court and judg- ment entered thereon : Provided, That either party may appeal from the conclusions of law by a single judge to the court in banc, and such appeal shall be heard as other cases are heard on questions of law, and judgment shall be entered in accordance with the conclusions of law made by the court. Sec. 7. That a stenographer may be appointed by the court, or by a siugle judge, to reduce the oral testimony to writing, upon his own motion or at the request of either party. Such stenographer shall be allowed a reasonable compensation, to be certi- fied by the court or judge, and paid out of the public treasury. Sec. 8 . That the court may appoint regular terms for the trial of cases by a single judge with assessors, at either of said ports, or may hold special terms therefor, and may sit in banc at either of said ports, as necessity or convenience may require. Rooms for said terms shall be provided in the court-house when practicable, or the court may procure rooms for that purpose when necessary, the expense thereof to be allowed, on the certificate of the court or a single judge, and paid out of the public treasury. Sec. 9. That from any final judgment of the Court of Claims, except when the same is entered upon the conclusions of law by a single judge, t here shall be the same light of appeal, either by the United States or by the claimant, and subject to the same rules and regulations as are prescribed by law for appeals in other cases against the United States from the judgments of said court. Sec. 10. That if no appeal be taken from the judgment and determination of the Court of Claims in cases provided for in this act within the term limited by law for appealing from the judgments of said court, the same shall be final ; and in all cases of final judgments by the Court of Claims, or on appeal by the Supreme Court where the same are affirmed in favor of the claimant, said judgments shall be certified to the 200 TAKIFF COMMISSION. [ftkxry p. frexch. Secretary of the Treasury, and paid as moneyisrefnndednpon the decisions of the Sec- retary of the Treasury in case of the unascertained duties, or duties or other money paid under protest and appeal. In cases where the judgment appealed from by the United States is in favor of the claimant, and the same is affirmed by the Supreme Court, in- terest thereon at the rate of live per centum shall be allowed from the date of its ren- dition iu the Court of Claims, but no interest shall be allowed subsequent to the affirm- ance unless presented for payment to the Secretary of the Treasury within thirty days thereafter. Sec. 11. That the Attorney-General of the United States, by himself or his assist- ants, shall defend the United States against all appeals from customs officers prose- cuted in said court, and on appeal in the Supreme Court, in like manner as he is now by law required to defend the United States, with the same power to interpose therein counter-claims and offsets and defenses for fraud practiced or attempted, and all other legal defenses. s Sec. 1*2. That hereafter no action shall be brought against any collector or other proper officer of the customs in any manner in which an appeal is allowed by this act to the Secretary of the Treasury or to the Court of Claims : and sections 3011 and 3012 are hereby repealed, but such repeal shall not affect pending cases, except as herein- before set out. In sections 1 and 2 of the act of March 3, 1875, chapter 136, the words “circuit or district court of the United States” are stricken out, and the words “ Court of Claims ” are inserted. Joseph Wharton.] NICKEL. 201 JOSEPH WHARTON. Long Branch, N. J., July 26, 1882. Mr. Joseph Wharton, of Philadelphia, representing the nickel in- terest, appeared before the Commission in response to its invitation, and made the following statement : Gentlemen of the Commission : I was unfortunate in not being present to hear the whole of Mr. Wheeler’s statement to you, but lam told that he spoke in regard to nickel as well as on other subjects con- nected with the tariff, and that he stated, among other things, that nickel had been admitted almost duty free until a few years ago, when a duty of 20 cents a pound had been placed upon it, whereupon the price of nickel had promptly doubled. Now that is a gross misstatement of the case. We must hold to facts as a basis for our arguments, and I shall address you on that basis. The facts are that nickel, being an extremely difficult thing to make, was not made in this country, and being considered as a raw material the duty on it remained at 15 per cent, even after I had established its manufacture here. It was only after many very tedious attempts to show the true state of the case to Congress that it was induced to place the duty at 30 cents a pound upon nickel and 20 cents a pound upon alloy of nickel with copper. The effect of that duty was not apparent in any change of price. There was no considerable change of price until the German Government, after the cessation of the war between Germany and France, undertook to adopt nickel alloy coins. The adoption of that system of coinage by Germany raised the European price of nickel from 4 shillings to 20 shillings a pound. I did not take advantage of this increase of price in nickel abroad, and did not charge my customers so high a price as their rivals were paying for nickel in Europe. I repeat, I not only did not add the duty to my price, but I did not charge my customers so high a price as the European manufacturers charged their customers. The high price continued until the German Government fin- ished its coinage ; and that government had to pay double as much for the nickel entering into its coinage (although Germany was, so tar as nickel is concerned, a free-trade country, and is besides the original home of the nickel manufacture) as the American Government had to pay for the nickel in its coinage, although American nickel is protected by 30 cents a pound duty. This shows the falsity of the theory that the duty is always added to the cost of the article. After this great demand for nickel in Germany, on account of the nickel coinage, ceased, a discovery was made in New Caledonia of a nickel ore of greater richness, and easier access to the sea, and better workability than had theretofore been used in this country or Europe; a great flood of these ores came into Europe, and that, combined with the cessation of the German de- mand, put the price down lower than it had ever been before. When that took place there was a very keen demand on the part of the Euro- pean makers of nickel to get possession of this market. They not only resorb'd to all the ordinary means for putting their wares into this market, but they resorted to a curious trick, which I will now explain. The duty, as has been said, was 30 cents a pound upon nickel, while it 202 TARIFF COMMISSION. [JOSEPH WH VRTON. was only 20 cents a pound upon nickel alloyed with copper. This meant that the article to be admitted at 20 cents per pound should be composed one-half of copper and one-half of nickel, or about those proportions. I have a right to say this, because I wrote those words in the law myself, and know just what was meant, and know it was thoroughly explained to the law -makers in both houses of Congress, and that such was the intention of the law. Commercially pure nickel at that time contained about 95 per cent, of nickel, and the alloy of copper with nickel was about half and half. The foreign manufacturers, finding that nickel was reduced in price very much in their home market, and that the possession of this market was extremely desirable to them, experimented on the credulity of our officials and began to make artificial alloys of nickel with copper, with just as much nickel and just as little copper as they could get through the custom-house at this duty of 20 cents a pound. Their experiments resulted in making an alloy of 95 per cent, of nickel and 5 per cent, of copper. They therefore merely replaced the 5 per cent, of worthless matter contained in the commercially pure nickel of the law by 5 per cent, of valuable copper and brought that composition into this country in the disguise of alloy of nickel with copper, and claimed to have it brought in at 20 cents a pound. The New York custom-house officials would not pass it, the case was carried to Washington, and orders came from Washington under a Treasury ruling to admit it at 20 cents duty. I was kept in ignorance of that ruling, and never discovered it until I was informed of the fact by my customers. That fraud or evasion has been maintained ever since. The Treasury officials have never yet been able to convince themselves that they should interfere in this matter in order to protect American manufacturers, and this fraud has continued to go on from that day until the present moment. This is one point for this Commission to adjust. I desire that alloy of nickel with copper shall be placed at 30 cents a pound, the same rate that is placed upon pure nickel. The purpose of the law has been evaded and nullified; the importation of nickel under the disguise of nickel alloy has become greater and greater, and about all the importations now are in that form. My own business is drying up, and I have given orders to stop mining until I see how it is going to end, although I do not propose to go out of tlse business. If I have got to go into the fight I shall try to make it interesting to the parties on the other side. Here is a case where the weakness of our system is shown in the rulings of the Treasury Department on questions open to doubt. *There ought to be some system by which the decisions of the Treasury Department may be more intelligent, and, at the same time, more fixed and less liable to vacillation. My own notion about that matter is that there eventually will be a body in this country with power something akin to the powers vested by the government in the English board of trade, that is to say, a body which shall have absolute control of all these questions of Treasury rulings, and even, perhaps, within narrow limits, have juris- diction of the question of rates. I do not see that otherwise we are going to be on a permanent solid basis in this country in regard to this large class of questions, where law is made by comparatively irre- sponsible Treasury officials, which was never contemplated. They have made law to an extent that is absolutely bewildering, and, I believe, entirely incredible to persons who have never paid attention to the subject. But the worst of it is, that the official-made law has been against the American manufacturer and in favor of the foreign im- JOSEPH WHARTON.] NICKEL. 203 porter or the agent of the foreign importer. The animus of the Treas- ury officials seems to be against the American manufacturer; they seem to think the importers have vested rights and the American manufact- urers have none. I will state to the commission that I have about ' 00 persons employed in this nickel manufacture. If matters remain as they are, this force of laborers will be dismissed and the business will be wound up; and all in order that two or three New York importers can draw commissions upon their importations. If I alone were interested in this matter, I should not urge it upon your attention with so much earnestness, for per- haps it would be a little matter to the government under those circum- stances. But while it is a matter of some indifference to me whether I continue in this business or not, as I am not at all dependent on it, it is of great importance to the persons who are consuming nickel. When Germany was taking and consuming for coinage a large proportion of the nickel of the world, the nickel-consuming industries would have been extinguished in this country if my establishment had not been kept running. But I kept it running, and supplied my customers w ith nickel at a lower price than they could have bought it for in any part of Europe, if there had been no freight or duty to pay. That case may arise again. The French Government has thought of coining nickel, and, although the supplies now are larger, still the conditions might arise where, if American consumers were wholly dependent upon the foreign manufacturer, they might be unable to procure adequate sup- plies. Therefore, I say it is imprudent to the last degree to destroy an American manufacture in order that a few foreign manufacturers may be able to take advantage of some temporary condition of affairs in this country to extend their business. I regard it as a case of waste that can hardly be characterized in too strong words. When a farmer sets out an orchard he expects that orchard to yield him fruit for a great many years. He does not expect that the w hole profit to be gained will return to him in the course of a year or two after the time he plants it. He knows that it is only by great care and nursing and watchfulness, extended over many years, that he can make it profitable, and one great part of that labor consists in keeping out his neighbor’s hogs. It would be a most shocking case of wastefulness on the part of the farmer to allow his wdiole orchard to be cut down, because at one moment it might seem to be cheaper to buy his apples from some one living in an adjoin- ing State. 1 think the same rule applies in regard to the production of any article of agriculture or manufacture, and it applies as w ; ell to nickel. I have nothing more to say about nickel, bitt I would like to speak on other subjects. I would like to say a word or tw r o in regard to cop- per. I am told that the gentleman who j>receded me (Mr. Wheeler) spoke of nickel and copper being made so high by the duties upon them that the articles made from them could not be exported. There he came face to face with another hard fact, which makes his statement seem almost grotesque. I know that large quantities of Lake Superior cop- per are exported every year, and that manufacturers of copper in this countiy, to a very large extent indeed, have been exporting their w ares, particularly in the article of cartridges and the material lor making cartridges. Several of my customers who deal in brass, German silver, and copper have taken contracts for almost countless millions of these cartridges made of copper, and they have been sent to Turkey, Bussia, and France. Then in regard to nickel, 1 have supplied it to some of these same men for making coins for foreign countries. 1 sold large quantities of nickel in Europe at high prices during the years of the 204 TARIFF COMMISSION. [JOSEPH WHARTON. German nickel coinage. Exportation of nickel, therefore, has taken place. I know also that these men have their agents in all parts of the world for selling their German silver goods, which also contain nickel; and they have that outlet. But the measure of utility of a tariff law is not to be taken by the quantity of manufactured goods that can be exported. There is no country in the world that is comparable to this country as a market for manufactured goods. AM the countries in the world, that we could hope to do business with, would not yield us one-tenth part of the business of our own country. The value of our own market, in comparison with all other markets, is the hrst thing to be considered. We must conquer our own market before we can hope to export. If we have here a plenum , the surplus will flow to other countries; but if a vacuum exists here, foreign articles will flow into our country. Take the case of copper. When the Lake Superior mines were opened, we had some small factories of copper which drew their supplies mainly from South America. The ores of Chili and Peru were brought to this country, and in Baltimore, Boston, and New York, there were prosper- ous manufactories of copper ; but they were all trifling compared with the huge production of copper in the Lake Michigan region. I have been in Washington, before committees of Congress, for many years; for at least twenty years I have been there whenever there was a tariff* fight on hand, and I remember when the fight occurred there on copper. At that time the great mining companies of Lake Superior were struggling and doing the best they could to make their way, and the supply of Lake copper was just beginning to be developed in this country. The existing duty upon copper was decided upon, and it is a higher duty perhaps than is necessary now. But the Lake Superior copper produc- tion has increased under it from the very trifling figure of those days to an enormous figure — I do not recall the figures exactly, but it is so great as to fill this country with copper, and almost prevent any impor- tations, not because of the duty being too high, but because of the im- mense production. There is, to be sure, a trifling supply of English- cop- per coming in all the time, but our fostering of our own copper production gives us a great deal of copper to export, and it also gives this country copper of a higher quali ty than any other country has. All the European countries use the old-fashioned smelting processes of extracting copper from ores, and, as a result, all their copper contains impurities and is not fit for the fine uses that the Lake Superior copper is tit for. Mr. John Stuart Mill says that it sometimes happens that the least expensive way in which a country can introduce a new and useful in- dusry is by temporarily taxing itself to support the new manufacture; and he is a good free-trade authority. This happened in the case of the Lake Superior copper, and we have the copper industry now, by virtue of the tariff* law, in the favorable condition of development that 1 have mentioned. I do not undertake to speak for the copper people, although I am the owner of copper land in the Lake Superior region and was president of a company there. I have no doubt you will hear from the metal men in person. Now 1 will say a word in regard to Bessemer steel. 1 am interested in two of the eleven Bessemer steel-rail companies, and know what I am talking about, i know when we were working this manufacture into a condiditiou of substantial prosperity, those who did not utterly fail had a very hard struggle, and received very moderate dividends on the capital invested, and thought themselves fortunate in being able to hold their heads above water. One of the companies I was inteiested in did not make any dividends for seven years. But we survived ; we JOSEPH WHARTON.] NICKEL. 205 put up a lot of new money and kept improving our works, preparatory to taking a new start. I put up about $G00,000 of new money myself to keep one of these concerns going. We kept it going and went with- out dividends, and built up our works and put them on a basis of much greater efficiency than was the case in any part of the world, and now our practice in manufacturing steel is so excellent that the European steel-makers come to us for instruction. Steel. rails are now selling at $:0 or less per ton, and have sold as low as $40 a ton. The transportation of the country has been cheapened by the estab- lishment of these Bessemer steel works. The railroads get steel rails as cheap as they used to get iron rails, and the steel rails last from three to ten times as long as the iron rails, because they are much stronger and harder. Thence, also, the railroad companies can put twice as much weight in a car; instead of using ten-ton cars, they frequently carry as many as twenty tons to the car. There is nothing in the world which, has done so much to cheapen freight for Western farmers, many of whom got their land for almost nothing from the government, and have had all sorts of aid from the government besides — I say nothing has done so much to advance the interest of that class of people as the establishment of these Bessemer-steel works. When the gov- ernment wanted a line of railroad built across the continent, it gave immense amounts of land and money to the promoters of those en- terprises, and, although many people growled at it, we cannot see how these roads could have been built without government aid. An equally great service has been rendered to the country by the estab- lishment of these Bessemer-steel rail factories, and yet it has not cost the government anything, nor has it cost the people of the county any- thing. They have been able to buy their rails cheaper by far than they would have done if these Bessemer-steel rail establishments had not ex- isted. When we began to make them the price was $125 to $130 a ton. The Bethlehem Company had an offer of $100 a ton for a number of thousand tons, and in that time of incipient, and almost experimental, manufacture, we had to decline the order on account of the lowness of the price; but now we are glad to sell these rails for $50, and have sold them as low as $40 a ton. The country has lost nothing, as far as individuals are concerned or as far as the government is con- cerned; on the other hand, the nation has been strengthened by this increase in the building of railroads through every part of the country ; transportation has been cheapened and the products of the West brought to our sea-board, and thereby our country gets the money to pay its foreign debts. 1 also know something about aniline dyes, because I was invited to go into that industry, and had occasion to examine it at the time. I declined to go into it because I had so many other kinds of business on hand. The idea that we have not in this country the material for manu- facturing aniline dyes is absurd. A small fraction of the waste of our gas-works would make all that the country wants. There is a lack of skill here to produce the dyes, and a certain amount of danger to life in the process of producing them. They are mostly made by the use of arsenic, which makes poisonous compounds, sometimes destroying the lives of healthy workmen, and perhaps destroying the lives of the per- sons who use aniline-dyed carpets or live in the rooms where the walls are covered with paper colored with aniline. But there is no trouble about the making of aniline dyes in this country. I think it is an in- dustry that should have every measure of encouragement that the gov- ernment sees lit to give to other industries. The same is the fact in regard to tin plates. There have been several 206 TARIFF COMMISSION. [JOSEPH WHARTON. attempts to establish the manufacture of tin plates, but all have failed, because the people were not patient enough, or had not money enough, and did not keep long enough at the business to establish it. The tin- plate people want government protection of some sort, and nnless they are protected by tariff duties they cannot last very long, although they are ready and anxious to establish the manufacture. 1 know there is considerable feeling in the western part of this State for the estab- lishment of that manufacture, and if the people are allowed they will establish it. There is not the slightest occasion for spending $15,000,000 abroad for tin plates that can be just as well produced in this country. We could keep all that money among us as well as not. But the per- sons who are to be the pioneers to build up this industry justly think it is due to them that they should have whatever measure of protection the government sees fit to give to other persons engaged in other manu- factures. It is not a doubtful result ; the production of tin plates will be a success eventually. In regard to wool I desire to say a word. I have frequently had con- versation with the largest carpet maker in America, Mr. John Dobson, of the firm of John & James Dobson, of Philadelphia. I believe it is a fact that they make more carpets than any American manufacturer — even more than are made in Lowell, Mass. Mr. Dobson is going into the raising of sheep in connection with the production of carpets. He has at present many thousands of sheep in Texas. He does not think it necessary to dry up our wool industry in order that the carpet-men may thrive. He takes the ground that we must have our wool here, and, as I say, he is largely engaged in the growing of wool. I cannot say whether the sort of wool he is growing is the sort that he will consume in his own works. But the greatest manufacturer of carpets in the country is also a believer in the production of American wool, and is doing liis share to accomplish that result. Now as to ad valorem duties. What I said a little while ago as to the effect of the duty on nickel will illustrate the working of the ad valorem duty as compared with the specific duty. If, at the time nickel was selling in England at from 1G to 20 shillings a pound, the duty had been an ad valorem duty of 30 per cent., it would have been about $1.30 a pound upon nickel, at a time when it did not need any duty whatever. The price was so high on the other side that the duty fell away as a useless thing, and this duty, which under the ad valorem system would have been $1.30, would have been totally useless. On the other hand, when the price of nickel on the other side goes down to three shillings a pound, as at present, the same duty of 30 per cent, would be a little over 20 cents a-pound. The result is the duty slides up and down (but exactly the wrong way), and this uncertainty often adds to the price of nickel here and to the difficulty surrounding the consumers of nickel here who are unable to make their calculations for the future. If it was possible to have an ad valorem duty so contrived as to be high when foreign prices are low, and low when foreign prices are high, I think it would be a very good idea. But as the thing works in practice, it is absurd as anything I can think of; 1 mean in its practical workings. I do not say there are no occasions whatever on which an ad valorem duty on a staple article would, under all circumstances, work absurdly. But the necessary outcome of it is that the duty is unduly high at times of prosperity, or what I may call inflation, and unduly low at times of depression, when our people want all the protection that the law gives them. Gentlemen, I do not need to intrude upon your time any further at present. HF.NET BOWSE. ANILINE DYES. 207 HENRY BOWER. Long Branch, N. J., July 26, 1882. Mr. Henry Bower, of Philadelphia, made the following statement before the Commission in regard to the subject of aniline dyes, in addi- tion to his former statement on the general subject of chemicals, given on the 22d of July : I would like to make a short additional statement on the subject of aniline dyes. Some time ago, while this whole question was being dis- cussed in a public way, I received a letter from Mr. H. K. Lansing, the treasurer of the Albany Aniline and Chemical Works, relating to this subject, which I will take the liberty of reading. It was as follows : Albany Aniline Chemical Works, Albany, N. Y., February 8, 1882. Dear Sir: We desire to inform you that the manufacture of colors (aniline) com- menced in this country, we think, in 1866 by T. and C. Holliday, who subsequently old out to the Albany Aniline and Chemical Works, a company incorporated in April, 1868, with a capital of $*i5,000, and increased to $100,000. After expending all their capital on machinery and experiments in the manufacture of fine aniline colors, they reduced the capital to $25,000, and confined their attention to the product of aniline red until about two years ago, when new premises were purchased and some $60,000 expended for machinery. Chemists were brought from Switzerland and England, and we are now engaged in the manufacture of all the fine aniline blues, and expecting ere long to make all the finer colors made in Europe. As an illustration of the benefit the country has derived from our efforts, we can state that large crystals of red were sold in 1868 at $6.50, gold. We now supply the trade with an acknowledged better color at $2.50 per pound. Blues were sold one year ago at $4. Since we commenced making the price has dropped to $2.50. We think we deserve the sympathy and en- couragement of the powers that be. Verv respectfully, yours, H. K. LANSING, Treasurer. I will state that I have notified Mr. Lansing of the hearing that is going on before you, and he will appear in person and make a statement on this subject. I desire also to add that it appears that in 1880 there were 563,932 pounds of aniline dyes of foreign manufacture, of value, with duty added, $1,600,166.48, entered for consumption, while during the last census year only 80,518 pounds were produced in the United States, in value amount- ing to $107,282. These figures are the most exemplary that can be given to show the depressing effect on an industry of an unpremeditated reduction of d^iity. Had the other 50 cents per pound been allowed to remain, the position of aniline dyes would doubtless have been about the same as licorice and borax, and the country would have been inde- pedent in this regard. Not only has the reduction of this duty prevented the manufacture from growing until quite recently, but the danger of having another 50 cents per pound lopped off has naturally aided in hindering it, as one house sank $50,000, another $30,000 to my knowl- edge, following the reduction. I am informed that the manufacture of aniline dyes in Europe is prac- tically controlled by an English monopoly, which buys a large amount 208 TARIFF COMMISSION. [henry bower. of material for this manufacture in this country, sending it to Germany and Switzerland, where these colors are produced by the poorest paid labor in Europe, and shipped to England and America. Already an exten- sive English house has made overtures to parties in this country, looking to the control of these products, and thus to deprive us of the raw mate- rial after present contracts have expired. I could name other articles of chemical manufacture which are held in about the same prospective con- dition if the large European combinations should succeed in breaking through the barriers of our protective system. CHARLES A. STADLER.J MILT. 209 i CHARLES A. STADLER. Long Branch, K J., July 26, 1882. Mr. Charles A. Stadler, secretary of the United States Maltsters’ Association, appeared before the Commission in response to its invita- tion and made the following statement: Gentlemen of the Commission : I desire to state that we import annually from six to ten millions of bushels of Canada barley and Canada malt. The Canada barley being of better quality than that of the United States, and barley being besides an uncertain crop within the States, our consumers cannot do without the Canada supply. Whether the Canada produce is imported either in barley or malt does not affect the import revenue from the same, as the present 20 per cent, ad valorem duty on foreign malt and the specific duty of 15 cents per bushel on foreign barley are nearly equal, the one exceeding the other merely according to the market price of the article. Any differ- ence in favor of malt is wiped out by the lower invoices of the ad valo- rem duty on malt against the specific duty on barley. Under the Canadian reciprocity treaty the duty on malt was 20 per cent, ad valorem, the same as it is now. Barley was free of duty. When that treaty was abolished barley no longer remained free, but a specific duty of 15 cents per bushel was put on it, while the duty on the manufactured article remained the same as when the raw material was free of duty. That was an oversight in legislation, and the source of all the complaints of the maltsters of the United States, as thereby they are prevented from competing successfully with their Canada neighbors. The Canadian Government levies a specific duty of 34 cents on the bushel of American malt, against our 20 per cent, ad valorem on Canada malt. The United States maltsters, unwilling and unable to bear this state of affairs, which with the yearly increasing importation of Canada malt will in the end ruin their business, went, four years ago, before Congress, and asked an increase of duty on foreign malt from 20 per cent, ad valorem to 35 cents specific duty per bushel of 34 pounds. To that the brewers, through the United States Brewers’ Association, ob- jected, and the bill failed. The brewers, however, seeing the injustice done the American maltsters, made (at their annual convention at Bal- timore in June, 18 8) a compromise with them, agreeing on a rate of duty on malt of 25 cents per bushel of 34 pounds. At the present 20 per cent, ad valorem duty, that amount is received by the government whenever the valuation of one bushel of malt in the Canadian market reaches $1.25. The brewers accepted that as a mean, the price of malt running from 90 cents up to $1.70. For that reason the 25 cents duty asked will simply equalize the present duties between malt and barley. H. Mis. 6 14 210 TARIFF COMMISSION. [CHARLES A. 8TADLER. So. for instance, the price of malt at present is $1.30 to $1.50, which, at 20 per cent, ad valorem, gives a duty from 26 to 30 cents per bushel, an increase respectively of one to five cents duty on the 25 cents in the bill. If the bushel of malt cost $1.80, the present ad valorem duty will be 36 cents per bushel ; if $2, 40 cents per bushel. If, on the other hand, the price is less than $1.25, the duty will be correspondingly less than 25 cents per bushel. The brewers were guided in effecting this compromise not merely by the desire to help American maltsters and retain the money for malting Canada barley in this country, but they desired also to have a fixed duty, which gives them more fixed prices. For that reason a cammittee was appointed at the Baltimore Brewers 7 Convention in 1878 to visit Washington and petition Congress. A bill was introduced, and though it passed the Committee of Ways and Means, after full deliberation, it failed to pass the House on account of want of time. In spring, 1880, another bill was introduced, and, after due deliberation in the committee, it passed the House unanimously. Before its passage the brewers met in convention in Buffalo, in June, 1880, when, after a full and lengthy discussion, with but two dissenting votes, adopted a resolution in which they reiterated their adherence to the compromise agreed upon in June, 1878, at Baltimore. Since then the Canadian maltsters, supported by their customers in the United States, have made strong efforts to ignore the almost unani- mous action of the last four brewers’ conventions. But against them stand the bulk of the brewers of the United States as represented through that intelligent body, the United States Brew- ers’ Association. Hence this bill is both advocated by consumers and manufacturers alike. With the permission of the Commission I will read an extract from a report made by B. H. Hinds, special agent of the Treasury Department, dated March 15, 1881: u In Canada there is a malt-tax, and every malt-honse is a bonded warehouse. It appears that, under some regulation of the inland rev- enue authorities, the manufacturer is allowed to withdraw for consump- tion per cent, more than the quantity on which he pays excise duty. * * * (jn so flimsy a pretext as this have the Canadian shippers for years been claiming and receiving discounts of 2J per cent, from the total amounts of their invoices at the various frontier ports. “In the United States such a discount is entirely unknown, so far as I can learn, except New York City ; and I am informed by American maltsters, that on account of this discount from regular prices at New York, malt is always quoted and sold in that market about 2J per cent, in advance < f other markets ; so that even there the allowance is merely nominal, and the purchaser, in fact, receives no benefit from such local custom. “The impropriety, therefore, of allowing it on entries made by foreign shippers is obvious, since the American purchaser does not receive the benefit of this discount. “ From January 1, to September 30, 1880, there were imported into the various frontier ports the following quantities of malt, which were entered and paid duties at the prices and with the allowances indi- cated. In these tables I have reduced all importations to the Ameri- can bushel of 34 pounds, and varied the invoice prices to conform to such standard. I have also for convenience, in cases where the dis- count of 2£ per cent, has been made on the quantity, reduced such CHARLES A. 6T ADLER. ] MALT. 211 allowance to bushels and taken the value of the amount so deducted at the invoice prices : Port. Bushels entered. Dutiable value. Valueless 2\ per cent, commis- sion. Average invoice price. Deduction for dust. Amount of allow- ance for dust. Port Huron 77, 560 $57, 985 $56, 571 Cents. 72.9 Per cent. 2i $1, 515 05 Detroit 34, 284 58, 500 25, 710 25, 084 43, 541 73. 1 None. Buffalo 44, 627 74.5 2i 346 00 Niagara 576, 433 29, 435 443, 511 432, 699 74. 5 2\ 10, 549 87 Oswego 21, 346 20, 820 69.0 2 h 597 00 Cape Vincent 27, 611 18, 777 18, 325 66.4 2| 186 00 Oswegatchie 16, 597 4,698 6, 246 12, 853 3, 758 12, 540 3, 676 4, 958 75. 5 None. Champlain 78. 2 None. Vermont 5, 078 80.0 2i 123 95 831, 364 618, 214 13, 317 87 General average price, 74.36 cents per bushel of thirty-four pounds. “I come now to the question of what was the true market value of the malt imported as per foregoing table —taking into consideration the condition of the Canadian barley market during the season of 1879- 7 80. I am informed by parties who were large purchasers of Canadian bar- ley during the fall and winter of 1879 and the spring of 1880, that the average price of No. 2 Toronto did not, during those months, vary much from 65 cents per bushel. “I should here state that all malt imported into this country from Canada, so far as 1 have been able to learn, is consigned by the Cana- dian manufacturer and owner either to a railroad broker for the pur- pose of entry, or to the party to whom it has been sold. It is univer- sally sold by sample at an agreed price delivered in this country; and the pretense that there are recognized grades in Canadian malt, as most of the invoices would seem to imply from the statement that a particular lot is No. 2 or No. 1, is not warranted by the facts. The largest brewers in Milwaukee, who purchase large quantities of the malt, inform me that they always buy by sample, and know nothing about grades in either American or Canadian malt. I have to state that in October last one of the largest maltsters in Toronto informed me that his prices for malt had been during the season 90 cents per bushel of thirty-six pounds, which was as low as he could afford to sell it. u In the testimony taken before the consuls in Canada, it was shown that during the spring and summer of 1880, while shippers to the United States were invoicing their malt at from 70 to 80 cents per Cana- dian bushel, these witnesses, who were brewers, were paying for the same quality of malt, from 90 to 95 cents per bushel, exclusive of the inland tax. u These several kinds of evidence, coming as they do from such various and independent sources, concurring and corroborating each other in such an unmistakable manner, point irresistibly to the conclusion that a bushel of malt is fairly worth about 25 cents more than a bushel of the barley from which it is made. It will therefore be seen that the estimate submitted by me allows that the small Canadian manufacturer can produce malt nearly three cents per bushel cheaper than the largest and best-equipped American establishments, and even then, the mar- ket value of the malt is shown to be from 21.9 cents to 25.3 cents in 212 TARIFF COMMISSION. [CHAKLES A. STABLER. advance of the average cost of the barley, according as we estimate the manufacturer’s profit at 10 or 15 per cent. “Applying these calculations to the importations from January 1 to September 30, 1880, and reducing the price from 90 cents for 36 pounds to 85 cents to conform to the American bushel of 34 pounds, we find that while the actual market value was 85 cents, the average invoice price, as shown by table, was only 74.3 cents, requiring an advance of more than 14 per cent, to make true market value. It is true that some shipments were not undervalued to this extent; but, on the other hand, many must have been invoiced from 20 to 30 per cent, below their true market value, and I have therefore taken the average percentage. As the value of the importations at the average price per bushel is $618,214, and as this was 14 per cent, less than the true aggregate value, or only 86 per cent, of such correct value, it follows that the full value of these importations must have been $718,853, and that the difference between these amounts, which is $100,639, escaped the payment of the 20 per cent. duty. “I became convinced during the autumn of last year that large and systematic undervaluations were being practiced by the shippers of malt, and I therefore ascertained, in a few cases, the prices at which it had been delivered in this country and the expenses attending the ship- ment. By comparing these with the invoice prices, the percentage of the undervaluation in each shipment could be approximately ascer- tained. I will submit a few instances, by way of illustration: “ 1 James Slater, of London, during the early winter and spring, shipped some 60,000 bushels to the Best and Schlitz Brewing Companies, at Milwaukee, at prices varying from $1.10 to $1.05, and at the close of the season, in August, he disposed of the remainder of the stock at $1. He invoiced this at an average of 75J cents per American bushel, with 2J per cent, discount, which brings it to 73.3 cents. The cost of trans- portation I found to be 7 cents per bushel, which, with duty at 20 per cent, on 73.3 cents, would be 21.92 cents. This added to the invoice price should, in an honest importation, be very nearly the selling, price delivered. It amounts, however, to only 95.2 cents, while the selling price averaged 105. “‘ J. McMillan shipped in May, 1880, 3,500 bushels from Kingston to the Best Brewing Company, of Milwaukee, invoiced at 66^ cents per American bushel. The shipping expenses on this lot were probably 1 cent per bushel more than on Slater’s, so that if his invoice price was a correct one, and included his profit, he could afford to deliver it for about 88 cents. I learned at the brewery, however, that they paid him $1.22j- for the whole lot, and that it was an extraordinarily fine lot of malt made from Bay of Quinte barley, which was worth at least 10 cents per bushel more than Toronto barley.’ “I was informed in Buffalo that one of the Toronto shippers, William D. Matthews & Co., furnished, under a contract, 125,000 bushels of malt, during the season of 1879-’80, to Peter Doelger, a brewer in New York City, at an average of $1.18. Matthews’ entries are made at various ports at the rate of about 73.3 cents for the bushel of thirty- four pounds, including discounts, and, as the expense of shipping can- not exceed 10 cents per bushel, it is evident that the malt is greatly undervalued on the invoices. “There is too sharp a competition among manufacturers of this article to justify the presumption that any unusual advance over regular mar- ket rates was obtained in any of these transactions, and the conclusion CHARLES A. ST ADLER.] MALT. 213 therefore is that the government was defrauded out of a very large amount of duties by means of these undervaluations. 44 1 have already stated that all Canadian malt imported into this country, so far as I can learn, is consigned by the shipper or manu- facturer at a stipulated price, delivered to the purchaser. In this re- spect it bears a close resemblance to consignments made by European manufacturers to their American agents, and it has been found that the temptation to undervalue such goods, being an ad valorem rate of duty, is too strong to be resisted by a large majority of consignors. The fact that these shippers from Canada and the continent of Europe are not required to make oath to the correctness of their invoices before any magistrate having local jurisdiction seems to offer a still further inducement to fraud, since the only oath taken during the course of the importation is by an agent, to whom the goods have been consigned for the purpose of entry, and whose action is, therefore, of the most perfunctory character. 44 It is true that some of the consuls make a pretense of administering oaths as to the correctness of the shipper’s declaration when they cer- tify invoices, but as no record of such oath appears on the invoice or elsewhere, and as an oath taken before a United States consul cannot be recognized in the courts of Canada as a basis for a prosecution for perjury, it does not clearly appear for what purpose this ceremony is performed. 44 1 have in several instances, both at consulates and custom houses, found invoices and entries of malt and barley made on the same day at the same price.” 214 TARIFF COMMISSION. [DE WITT C. WAKD. DE WITT 0. WALD. Long Branch, N. J., July 26, 1882. Mr. De Witt C. Ward, of New York, chairman of the executive committee of the United States Maltsters’ Association, appeared before the Commission, in response to its invitation, and gave the following statement in regard to the malt interest : Gentlemen of the Commission: In relation to the subject of malt, concerning which I appear before you to-day, I desire to state that about four years ago, as malt manufacturers of the State of New York and of the United States, we found ourselves at a great disadvantage in sell- ing our goods. Upon making inquiry as to the cause, we ascertained that by reason of undervaluations, exteusively practiced on the Cana- dian borders, and also by reason of the opportunities that the Canadians had of manufacturing very cheaply indeed, we were at a disadvantage so great that they could undersell us in our own market. I was one of a committee who went to Washington and brought these matters to the attention of Congress. On the 9th September, 1854, what is known as the reciprocity treaty between the United States and Canada was ratified. By that treaty barley and other raw materials intended for consumption in the United States was allowed to be imported free of duty. But the duty of 20 per cent, ad valorem on malt, which was then in force, was suffered to stand unchanged, malt being classed as a manufactured article. In March, 1861, there was an act passed levying a duty of 15 cents per bushel on barley, and a duty on malt of 20 per cent, ad valorem, and this act is still in operation. But from the years U61 to 1866 Canadian barley was exempt from this duty by virtue of the reciprocity treaty, which allowed the raw material to be imported into the United States from Canada, duty free. When, however, that treaty was annulled, in 1866, Canadian barley necessarily became subject to the duty referred to of 15 cents per bushel (malt continuing, as before, subject to an ad-valorem duty of 20 per cent.), and thus ever since 1866 the American maltster lias been com- pelled by the act of his own government to pay 15 cents a bushel more than he did before on every bushel lie imports. At that period the malting business was not of the large extent to which it has since necessarily grown in order to meet the increased con- sumption of malt-liquors. Neither did Canadian maltsters then possess the facilities which they have since acquired for making large quantities of malt for export. Besides, owing to the high and fluctuating prices of grain, as of other commodities during the inflation period, say from 1866 to 1874, the 20 per cent, ad- valorem duty on malt actually amounted to about double what it is now. Thus, for example, in the winter of 1873-’74, when the best Canadian barley was selling in New York as high as $2 per bushel, malt made from such barley was worth say $2 25 to $2.30 per bushel; while, then, the specific duty on barley was 15 cents per bushel, the ad-valorem duty on malt must have come to 45 cents per bushel. When the great fall in prices began to take place there was necessarily a corresponding fall in the duty actually paid on malt. This has lor the DE WITT C. WARD.] MALT. 215 past two or three years (taking” 36 pounds of malt as the equivalent of 48 pounds of barley) seldom amounted to more than from 11 cents to 15 cents per 36 pounds. Thus we have the duty on the raw material, which the American maltsters are to manufacture, higher than the duty on the manufactured article itself. This slate of things has within the last four years been respectfully presented to the notice of the United States Government on several occasions by the American maltsters, but thus far without any effect. It is in the mean time growing more and more plain to them that, unless a speedy change takes place, the large and once prosperous business of malt- ing must soon come to an end in the United States, particularly in New York State, where so large a quantity of malt is made. The maltsters in New York and neighboring States consume yearly from five to seven million bushels of Canadian barley, and to Canada they must always look for the great bulk of their supply. They would prefer to have Canadian barley come in as it did before 1866, duty free. Nor are they able to perceive why an act which, like many others, was made necessary by the exigencies of a great war should still be kept in force, to their great detriment, in these times of peace. But if the present duty of 15 cents per bushel on barley must be main- tained, then they ask for a proportionate specific duty on malt. A spe- cific duty of 35 cents per bushel would fairly represent the difference that existed in reciprocity times. A specific duty bn malt is, moreover, required in order to preserve the proper proportion between the rates of duty on barley and malt and to keep them uniform. It would also evi- dently be the most suitable in this case, since the malt imported from Canada is, and is likely to be, in the main, of a uniform quality. The reasons for placing a higher duty on malt than on barley are sim- ple and obvious. But lew need be presented. They are such as are common to many kinds of manufactures in the United States, where foreign raw materials are used on which a duty has been paid. The American maltsters buy their Canadian barley from the importers of it, who, after having paid duty, freight, and other charges, are, at present prices, obliged to ask an advance of about 50 per cent, on its first cost. Moreover, in turning the barley into malt there is a necessary wastage of about 25 per cent, of the barley, upon which wastage the American maltster has, nevertheless, to pay duty and transportation, all which, of course, increase the cost of the malt. The Canadian, on the other hand, buys his barley at first hand from the farmers, and thereby escapes many charges which his American com- petitor is liable to. Nor is he obliged to pay freight and duty until he lias his manufactured goods ready for sale in the United States. Con- sequently, he requires only about one-half of the capital that an Ameri- can maltster must have tor a business of the same extent. Canadian barley, furthermore, has first to be distributed by the im- porters among the maltsters, and then again by the maltsters among the brewers; but this first distribution the Canadian maltster does not have to pay for, inasmuch as he can buy his barley from farmers at his own door; and as for the second, he usually ships his malt direct from Can- ada to his customers in the United States. American maltsters think that, as most of the large manufacturing in- terests in the United States are protected to a greater or less extent, so as to enhance the cost of materials and the price of labor, it is ex- tremely unjust on the part of our government to pursue a policy so ruinous to the malting business as to permit, as is actually the case, for- 216 TARIFF COMMISSION. [ DE WITT C. WARD. eign maltsters to sell their malt in our own markets, not merely on the same footing with ourselves, but on the payment of a less duty on their manufactures than the American maltster pays on the raw material. Let me call your attention to the fact that Canada protects her malt manufacturers by a duty of 34 cents per bushel, and it does seem only justice that the small protection asked for by the Americans should be granted. By Commissioner McMahon : Question. Would it make a particle of difference one way or the other to the consumer of the beer? — Answer. No, sir. I suppose this Com- mission knows very well about barley malt. Barley malt is to-day worth $1.40 a bushel; 20 per cent, on that is pretty nearly 30 cents a bushel. We ask 25 cents a bushel protection. Even at the worst it could not be more than 3 cents increase. It takes 2J bushels of malt to make a barrel of beer, aud when you divide the 3 cents up on 2J bushels of malt, it would require a microscope to enable you to discover an increase, if it was an increase, to the consumer. We contend it is no increase whatever. It is simply an equalization of duty all round, and 1 think you gentlemen will come to that conclusion when you have fully consid- ered that fact. E. P. WHEELER, j CRUDE MATERIALS. 217 E. P. WHEELER. Long Branch, N. J., July 26, 1882. Mr. Everett P. Wheeler, of New York, representing the New York Free Trade Club, appeared before tbe Commission, in response to its invitation, and made the following statement : Gentlemen of the Commission : I desire to state, in the first place, that we do not wish to present our views on tariff matters to the Com- mission in a theoretical light. We appreciate entirely the observations of your president at the opening of your sessions, that the policy of the country, so far as the Commission is concerned, is settled by the law of its creation, and that what yon are about to undertake is a re- vision of the tariff, and not any radical change in its principal features. We appreciate fully, too, the importance of the suggestions that were made by your president, that in considering this subject attention should be paid to all branches of industry; that it would not be just to dis- criminate in favor of one industry at the expense of another, but that the aim should be to harmonize the operation of the tariff laws and modify them in such a way as to do justise to each industry. What we un- derstand free trade to mean is fair trade; an impartial and equitable system of taxation. It seemed to us and to the gentlemen whom we represent, who are engaged in a great many different industries, some in commerce, some in manufacturing pursuits, and some in other branches of business, that these particular topics that we shall call the attention of the Commission to are perhaps the most obnoxious and more open to criticism than any part of the present tariff. Without going into the whole subject, which is a great one, and in regard to which I am sure you already realize its magnitude and its difficulties, I think I can briefly call your atten- tion to a few points, and suggest what I think will be a practical reform in any revision of the tariff you may choose to adopt. I may say in the beginning, that one object we had in mind in suggesting any changes at all is relief to manufacturing industries and consequently to con- sumers by diminishing or abolishing altogether the duties on raw ma- terials. We appreciate that it is important that this country should be a great manufacturing country, as it is already one of the greatest manufacturing countries in the world. We appreciate, too, that it is very desirable we should have a foreign market for our manufactured product ; that we should not be shut up entirely to the limits of our own American Union. Of course this country does afford us a great market in itself, but in times of depression of business it Avould be a great ad- vantage to manufacturers to be able to dispose of their surplus goods in foreign markets. But if raw materials are heavily taxed, we cannot compete with those countries. In this view of the question, it seems to me it would be desirable to begin a revision of the present tariff sys- tem in this direction. Take, for example, the first of the subjects to which I desire to call your attention, that is, copper. It is almost impossible to enumerate the great variety of articles into the manufacture of which copper en- ters. There is probably not a house in America in which there is not 218 TARIFF COMMISSION. fE. P. WHEELER. some article in wliicb copper is used. It is used in the plumbing, in culinary utensils, in hardware, in everything into wdiich brass enters, as we know; as clocks and gas fixtures; and the labor which enters into the manufacture of these copper goods is, to a great extent, skilled labor, and the goods are of a character which require a large amount of labor in their manufacture. Of course we are all aware that in all manufac- tured goods there are some into which the element of labor enters but little; I mean goods that are easily made, where machinery does the most of the work. There are other articles, however, like those I have just mentioned, which require more labor and skill, and in regard to which the wages bear a larger proportion to the expense of producing the manufactured article than in other directions. I should like to call your attention in the first place to the present duty on copper and copper ore. The duty on copper ore is three cents a pound for each pound of fine copper contained in the ore, graduated according to the richness of the ore itself. The duty on copper ingots amounts to five cents a pound. The copper mining industry in this country exists principally in the State of Michigan. There are, of course, copper mines in Maine, Maryland, and Missouri, and in a few other States, but the great bulk of the business is done in the State of Michigan, so that as it appears from the last census returns, out of 50,655,140 pounds of the product of the copper mines, 45,830,202 pounds were produced in Michigan. The cost of producing the copper thus mined was, in wages, $2,915,103. In making up the statement of the capital employed, the figures are not given of the capital invested. I do not know why the schedules of the census in this regard were made up on a different basis from those in reference to some other indus- tries where the capital invested is treated as the amount in regard to which a return was sought. But in this particular case the capital is stated in various subdivisions. In the first place, the working capi- tal is given, then the value of the plant, then the value of the real estate. I venture to say that in regard to most of these copper mines, the value of the real estate, as stated in these schedules, is very much in excess of its cost. Take, for example, the Calumet and Ilecla mines, the most profitable in the State of Michigan. Undoubtedly the value is what the present owners consider it to be, and not what it cost them, and it is perhaps the value they ought to give. So that in looking at these figures, although they show a large return of the capital invested, and give to the owners the benefit of all the profits that had been applied and realized by the raising of the duty on copper ore and copper ingots, still we find that even on the basis of the present valuation, the profit during the census year amounted to 14 per cent, on the value of the capital invested. Taking the cost of production by adding to the materials and supplies used the amount paid for wages, and then deducting it from the aggregate value of the products of the mine (and I am speaking here, you will observe, of the ore that is mined without reference to the form that it afterward assumes), we find a profit on the capital in its present enhanced value of 14 per cent. It seems to me that this is one of those raw materials in regard to which the duties ought to be very small, if there should be any duty at all imposed. The miners have cheap water transportation. The mines are right on the shores of Lake Superior. To a very large degree the mines are above ground, and the expense of mining is much less than it is in most of the copper mines of Europe. I notice, for example, in the statement of the character of the labor of the persons employed in these mines, that half of them are employed above grouud. And any one E. P. WHEELER.] CRUDE MATERIALS. 219 who has ever visited those mines knows that the operations of mining there are comparatively inexpensive compared with mining in Europe, where they go to a great depth. So that we have in the case of these Michigan mines two very favorable elements: first, cheap production: second, cheap transportation. We say, then, is it just to increase the profits of the capital invested in this business at the expense of the industries of this country engaged in the manufacture of copper and brass goods, and, as a consequence, that they should be taxed for that purpose? It seems to us that this is a manifest injustice, and that it would be no injustice to the mining interests of Michigan if copper ore were put on the free list as it was upon the tariff as it existed before the war. Let me say in this connection, and it shows the effect of changes of duties, that at that time it was very common for vessels engaged in the South American trade to bring copper ore from South American states, especially from Chili, in ballast to New York, and there was a consider- able smelting interest which grew up in New York engaged in the smelt- ing of this ore ; but as soon as the duty was imposed on copper ore, that industry there was entirely destroyed, because the value of the ore was not sufficient to enable them to stand the duty. In point of fact, there is no copper ore of any consequence imported into this country now, or if there is, the amount is infinitesimal. I have the figures here, but they are so small as to practically amount to nothing. The entire value of copper ore imported into this country in the year ending June 30, 1880, amounted to only $165,000, and of copper in ingots only $86,000 ; so that, practically, the operation of the tariff is to give a monopoly of the copper production to the copper mining interests of this country, and it operates as a tax upon all these manufacturers who are engaged in the manufacture of copper and brass goods. So much for the subject of copper. I will state, Mr. President and gentlemen of the commission, that 1 propose to submit to you at a later date, in a printed form, these figures and statistics which I am now stating in. this cursory and conversational way, in order to lay them more conveniently before you. The next subject to which I call the attention of the commission is the subject of nickel. This is also a comparatively crude material which enters very largely into the manufacturing industries of this country, and wdiich, under the tariff as it existed before 1861, was admitted free of duty. In 1870 the duty was increased to its present rate, which is 30 cents a pound. This increase in the tariff on nickel was almost contem- poraneous with the invention of a very ingenious citizen of your own State, Mr. President, Mr. Adams, who, for the first time, discovered a process by which nickel-plating could be cheaply done. Up to that time almost all plated goods that were comparatively cheap in their price were silver-plated. Nickel, while it has not the brilliant luster of silver tarnishes less readily, is more desirable for plating for various purposes, and it is used for almost everything. The railroad-car I rode on this morning in coming here I noticed had nickel- plated arms to the seats. The bicycles we see on our streets are to a considerable extent plated with nickel; the carriages that we use have, many of them, some portion plated with nickel, and so with the harness, and so you may go through every variety of metal work of every quality and description that it is desirable to protect from the weather, and you will find that it is plated with this useful material. Almost the entire production of nickel in this country is from one mine in Pennsylvania, and I am told that the effect of the duty on nickel, 220 TARIFF COMMISSION. [E. P. WHEELER. which is practically a prohibitory one, it being so large as to prevent the profitable importation of the nickel at all, lias been to yield an enor- mous profit to the producer of this article iu Pennsylvania, and there is but one large producer in America. I am informed by the nickel man- ufacturers that the moment the duty was increased to its present figure, without any increase in the cost of production at all, without any increase in wages, without any increase in invested capital, there was an immediate doublingof the price per pound to the nickel-plater, and that that price has been maintained and to some extent increased since that time. To so great an extent has this injustice reached that the Meriden Britannia Company, which is one of the largest consumers of nickel in this country, has been obliged to establish a factory in Cnaada in order to compete for the foreign market. The price of nickel in this country is such, owing to the existing tariff, that it cannot be profit- ably exported, and with all their skilled laborers and understanding of the business (and they make the best, or claim to make the best, plated goods that are made in the world), they cannot sell them in Eng- land, in South America, or on the Continent of Europe, because they have to pay so much for what to them is a raw material. The expense of the manufacture or of the reducing of nickel from the form in which it is found iu the mine is not expensive or difficult. Without going into de- tails as to the method employed to do this, and in regard to which I have brought some memoranda here, I will simply state as the fact that it is not an expensive process, and that there is no reason why the owner of the mine who digs the ore of nickel out of the earth should be protected or benefited, because it is not in any just sense a produc- tion which should be benefited and enriched by imposing what becomes a duty on the purchaser, on the nickel-plater, and on every consumer of nickel goods. It seems to us that a reduction from 30 cents a pound to 5 cents a pound would certainly yield all that the nickel-miners and nickel-smelters of this country can justly claim, and at the same time it would afford a great benefit to all the nickel-platers and cheapen the price of their product largely by enabling them to bring back to America this factory which, owing to our injudicious laws, they have been obliged to transport to Canada. The next topic which I call the attention of the commission to, is the subject of steel rails. This subject has been very much discussed in Congress and out of it. But, with the permission of the Commission, I will state very briefly the way in which the duty on steel rails came to be fixed at the present figure of $28 a ton, or 1J cents a pound. Down to the time when that duty was changed, which was in the latter part of 1870, the price of steel rails in England had been about £11 10s. a ton. The reason why they had been at that figure was manifold. In the first place, the original Bessemer patent, under which for the first time it became possible to make steel rails at all, had not then expired, and Mr. Bessemer received a royalty of 10 shillings a ton for every ton made in England. Under the operation of our patent laws the term of the expiration of his English patent was also the term of the expiration of any American patent that might be obtained. While there have been subsequent patents, and some are still in force, lor particular improvements in the manufacture of all Bessemer steel, substantially this royalty was paid. When that patent expired, of course the production and manufacture was open to all. That, in itself, in the early part of the year 1871, produced a reduction in the price of 10 shillings in the pound, or about $2.50 in the ton. In addition to that, the impetus that was given to the English manufacture of this article E. P. WHEELER.] CRUDE MATERIALS. 221 by taking off this royalty, and the greater scope that was given to the ingenuity of those that were engaged in the manufacture (and I may say the same thing in reference to the cost of production in this country, because our American ingenuity is equal to that of any country in the world, and there have been improvements made here as well as there in the method of production), owing, I say, to these two circumstances com- bined, the taking off of the royalty, and the improved methods of pro- duction, the cost of production was largely reduced. So that the price of steel rails delivered on board the vessel at Liverpool has fallen from £11 10s. a ton in 1889 to £5 5s. a ton at the present time. It fluctuates a little, but it does not vary much from that. It has been £5 10s. a ton within the last year. Roughly speaking, without going into exact details, it is about one-half of what it was in 1869. In this country we have not got the benefit, to any considerable ex- tent, of that reduction in the cost of production, or at least the con- sumers have not, because of this duty on the foreign article which at the present cost of the rail in England, amounts to 100 per cent, ad valorem. At the time the change was made it was not a change in amount. It was only a change from an ad valorem to a specific duty. But the value was such that at the time the duty of 1J cents a pound was put on steel rails, there was no difference in the amount the importer would pay on his importations, and it was not intended there should be any difference. Nobody contended that the duty on steel rails was not sufficient to enable the American manufacturer to compete in the Ameri- can mat ket with the foreign manufacturer. That is the theory of a duty imposed in good faith; that it should enable the American manufacturer to compete in the American market with the foreign manufacturer. When it goes beyond that and gives him a monopoly, then it becomes an injustice to the consumer which no intelligent government ought to tolerate. It did become that in the case of steel rails. There were several years in which we imported no steel rails at all, and it has only been because of the immense increase during the past five years of rail- road building in this country and the wonderful way in which railroads have been extended in Texas and throughout the whole southwestern country, and across the plains, that there has been any importation of steel rails at all. I call your attention, also, to the fact that the expense of these rails enters so largely into the expense of the construction of a railroad that the cost of freight and cost of passage is necessarily very largely enhanced by an increased cost in the construction of the road. A rail- road is a manufacture. The company engaged in building it is a manu- facturer. It is one of the most complicated and difficult productions of modern times. I think it may be said without hesitation that a well- built railroad is one of the most intricate constructions that the inge- nuity of man has ever undertaken. When you consider its lolling- stock and road-bed, its switches, and all the methods of operating it, I think you will agree with me that the business of railroad manufactur- ing deserves very great consideration. And there is not a person in this country who is not personally affected in one way or another by the expense of transportation on railroads. Everybody rides in the cars ; everybody buys that which is transported in the cars ; and there is not a citizen in the United States, from Maine to California and from Minnesota to Florida, who does not to-day pay more in one shape or another for the goods that he uses because of the increased price that railroad companies have been obliged to charge by reason of the in- creased cost of building the roads, owing to this enormous duty of 100 per cent, ad valorem on the rails which compose the road. 222 TARIFF COMMISSION. IE. P. WHEELEB. There is another objection, Mr. President and gentlemen of the Com- mission, to this duty upon steel rails that I desire to call your attention to. The effect of this cheapened production of steel has been to very largely change the use of iron rails to steel rails. So much has the pro- duction of steel been cheapened and improved that it really costs very little more to make a ton of steel rails than it does to make a ton of iron rails; the difference is not very considerable. But our tariff in this respect discriminates against the superior article and in favor of the inferior article. The tariff on iron rails is 70 cents on the hundred pounds, which, as you will perceive, is about half the duty on steel rails. There would seem to be no reason in this discrimination, or at least no good reason why the duty on these two descriptions of articles should not be the same, and I call your attention particularly in that connection to these circumstances* The iron industry of this country certainly prospered between the years 1860 and 1870. Before the duty was put at its present enormous figure on steel rails there was no com- plaint, so far as I am aware. If you compare the products of 1860 and 1870 by the figures contained in the census, you will find that the capi- tal invested had largely increased; that the return on that capital had largely increased; that the number of persons employed had increased, and that the product had increased very largely. So that under this system as it existed during those ten years, which was a system of high duties, the product had very much increased. There was not any just cause of complaint on the part of the iron industry against the tariff duties of the country. Yet this change, so made in the duties simply for the purpose of avoiding frauds in the valuation of imported steel rails, has operated in the way I have mentioned, and largely increased the profits realized by gentlemen who have been engaged in the manu- facture of this particular article, and has very largely increased, in con- sequence, the expense of our roads in the way which I have suggested. I do not care to urge again what very likely many gentlemen here have already read — the facts that were brought to the attention of the public by a litigation before the Orphans’ Court in Pennsylvania, in re- gard to the estate of Mr. J. Edgar Thompson. That did show in a very tangible and precise form the profits that had been realized by the steel-rail manufacturing companies in which Mr. Thompson was a stockholder, and showed that there had been several years during the past decade in which these profits amounted to 77 per cent. Now let us be just. I would not make the duty on steel rails less than the duty on similar articles manufactured of iron ; articles in ref- erence to which the cost of production and the requirements of the whole country are equally useful and important. But it seems to me that there could be no injustice to the steel-producing industry by putting it on the same basis as the iron-producing industry, and making the duty on the superior article of rails the same as that on the other. And 1 say superior in quality, because the superiority in quality is greater, owing to the increased improvements in the production, than the difference in the price; and if we are to have a specific duty at all on either of these articles, it seems to me it should be the more mod- erate one imposed on iron rails. I submit to the consideration of the Commission whether it would not be taking a large view of the subject, in reference to future years and future improvements ; whether it would not be more just to make the duty on steel rails and on iron rails both an ad valorem duty of say 45 per cent., and whether this rate of duty under previous legislation did not yield a sufficient compensation to the steel industries of this country in return for any disadvantages which ep. wheeler.} CRUDE MATERIALS. 223 they may be exposed to, and whether it would not be therefore making a more permanent provision. The only objection I know of against an ad valorem duty as opposed to a specific duty is the opportunity it offers for fraudulent under- valuations. But I would suggest that in regard to a staple article like steel and iron rails, dealt in in enormous quantities, and in regard to which no disguise or concealment is possible, there is no reason for specific duty at all. There are some articles undoubtedly which it is comparatively easy to undervalue. Some gentlemen may remember the litigation in regard to the value of champagne. It was shown that there were some brands of that wine made in France for the Ameri- can market which were not sold in France at all, and, therefore, the producers put their own value on them, and it was thought that fraud had arisen, and juries found verdicts against them. But no such case is possible in regard to steel and iron rails. They are exposed to view, and the price is a matter of public notoriety everywhere, and is well known at the custom-house. I suggest therefore that, for the purpose of giving the consumers of this country the fair benefit they ought to, get from an increased cheapness in the cost of production, it would be better to make this duty an ad valorem one. I use in illustration of this the facts stated by Mr. Campbell in regard to aniline dyes. It was shown by him clearly, and I think there is no dispute about that, that the cheapening the cost of production of these goods abroad has not benefited to the extent it ought the parties in this country who use them, because the duty being a fixed one of so much a pound instead of being based on a sliding scale, the price has been kept up instead of being diminished. And, as a consequence, all of us who use printed goods of any description, or paper of any description, have to pay more in the long run than we otherwise should have done if the maufacturers could have bought a cheaper dyestuff. And I would call your attention in that connection to a fallacy that I have often noted in the discussion of these tariff subjects, of minimising, so to speak, the difference in the cost produced by a reduction of duty. For instance, on a pane of window glass 8 by 10 inches it makes only a difference of one-half a cent, for example, and on a sheet of paper it would make perhaps only the difference of one-tenth or one-liundredth of a cent. But these gentlemen who make these statements forget how many pounds of window glass and sheets of paper are used in the course of a year. They forget that in this country we like to live on a more large and liberal scale than in other countries. It has been our boast that the conditions of life in America are such that we use articles of all descriptions with more freedom and liberality than other people in other countries, where the conditions of life are more exacting. But we never can do this unless we reduce the cost of production in small amounts. The difference of half a cent a yard on a cheap print may make all the difference in the ability of the producer in Massachusetts to sell it in South America in competition with a foreign manufacturer. When you find you are selling goods at 5 or 6 cents a yard, then the additional one-half cent a yard is an immense percentage on the cost. 1 hope that will be remembered when statistics of this sort are produced in reference to the very slight benefit that is obtained by a reduction of duty on each particular item, or the slight increase of cost that would be caused by increasing the duty. It may be a slight thing in each particular instance, but when you add the aggregates for a year it makes a very important difference. And one reason, in my judgment, why it is so much more expensive to live in this country than in any 224 TARIFF COMMISSION. [E. P. WHEELER. other country in the world, is because this fact has been lost sight of, and while people have thought that it would not make much difference in any particular instance, or in regard to any particular article, yet when the aggregate of quantities used by a household in the course of a year is ascertained, it is the difference between comfort and discomfort. If I may be pardoned for referring to a familiar illustration on this point I would say that Mr. Micawber summed up the whole question in a very few words when he said in regard to this matter, u income, 20 shillings; expenditures, 20 shillings and 6 pence; result, misery. Income 20 shil- lings; expenditure, 19 shillings and G pence; result, happiness.” It is just that shilling on the right or the wrong side of the ledger that makes the difference between comfort and discomfort in the expenses of a family. It is these little things and this slight reduction or increase of duty that will enter into the expense of many American families and affect their comfort in a very important way. The next topic to which I desire to call your attention is that of wire; and I will speak of that briefly. The operation of the present tariff on wire is beneficial to the manufacturers of that article; that is to say, a great deal of the steel wire that is made in this country is made of wire rods that are imported. The rate on wire rods which are over three- sixteenths of an inch in diameter is only a cent and a quarter a pound, which amounts to about 35 per cent, ad valorem ; whereas, the rate of duty on the finished article is 2J cents a pound and 20 per cent, ad va- lorem ; being, as you see, double duty. I do not object that the wire manufacturers of this country should have a benefit. I do not object that the duty on the manufactured article should be more than that on the rods out of which they draw their wire. It seems to me proper that it should be so. But the difference which practically prohibits the importation of foreign wire, and makes manufacturers here entirely in- dependent of foreign competition, is unreasonable. We all know that steel wire is used, particularly in the W T est, for fences to a very great ex- tent. Large tracts of country in the West, where they cannot use lumber at all, and do not have any stone to build up stone walls, as they do in New England, must be fenced in with fences made of this steel wire. There is much complaint among the western farmers that the tariff is such on steel wire as to unduly increase the profits of the manufacturers of wire. And it seems to those gentlemen, and I confess it seems to me, that if the duty on steel wire were reduced from the present compound duty to two cents a pound it would give to the manufacturers of the article, by the difference between that two cents and the one and a quarter cents a pound on the rods out of which they draw the wire, a sufficient benefit to put them quite on a level with the English manufacturers of wire, and, in fixer, to give them an advantage which perhaps would be proper to compensate them for the increased cost of labor in this country. No doubt there are some expenses to which American manufacturers are put which are greater than the expenses incurred by the foreign manufacturers for the same thing. I think it ought to be considered, however, that there are some expenses which are much less. For instance, land is much cheaper in this country than it is abroad, and, whereas, formerly, the interest on American capital was much higher than abroad, yet, owiug to the accumulation of wealth in this country, it is no longer the case, and the rate of interest on de- mand loans in New York to-day is no higher than it is in London. The next topic to which I desire to call your attention is one which interests us all, and I trust my presentation of it may not be entirely devoid of interest, although I know there is very much in these subjects E. P. WHEELER. | CRUDE MATERIALS. 225 that one may easily be tedious about. The subject is building material. Everybody must live in a house of some kind, whether of stone, wood, or brick. The building industry in this country is an enormous industry, and I think is not often considered as it should be. I have the statistics of that industry, which I have taken from thecensus report, and you will find by looking over the interesting pamphlet published by the Census Bu- reau in regard to the manufactories of cities, that one of the largest manufacturing industries in New York, for example, is that which enters into the construction of a house. You look through the entire list and it is divided up so that the whole effect is not given. But take carpen- try, copper-smithing, plumbing, and the other articles that enter into the building of a house, such as lumber, marble, stonework, gas-fitting, &c., and you will find that a very large percentage of the entire investment of capital, and the entire number of persons employed, are engaged in that particular industry of building and repairing houses. This must of necessity be so in any country, but especially is it so with an in- creasing population like ours. Our buildings are not generally erected as substantially as they are in foreign countries, and need reconstruc- tion more frequently, and, as our wealth increases, our style of living is better, and we pull down our old barns and build new ones. I there- fore call your attention to the degree to which the present tariff in creases the expenses of house building. There is hardly an article that enters into the construction of a house that is not subject to the opera- tion of the present tariff. As you will observe in reference to house building, all these things come under the head of raw material. Every- thing in a house is composed of raw material, on which carpenters, masons, and others, have labored, and the increased cost of material makes the cost of the house greater, the rent of the house greater, and the number to be built less. I had occasion a few years ago to build four houses in the city of New York. I discovered by figuring, that the operation of the duties upon building material was such that I could have built five houses, if there had been no tariff* on any of these things, with the same amount of money it took to build four houses. I should have spent the same amount of money, but I should have spent more of it for labor and less for material. It is a rule that the greater the expense of material the less will be the amount that will go into the wages of the persons who are working upon that material, other things being equal. I do not say that in every instance that is the fact, but take the whole year through and I think you will find it is generally true; that if you diminish the expense of material, you increase the amount expended for wages, and give that much im- petus to the industry of the country, and in that wa} r everybody is benefited, because the wages are spent in buying the products of man- ufacturers and the products of agricultural industry. The interest of the employer and the laborer is identical. When the laborers prosper and get good wages and spend the money they earn, everybod}' pros- pers. There are some of the heavy articles that enter into the construction of a house that we do not import at all. Brick, for example, are subject to a duty of 25 per cent., which duty is in fact a prohibitory one. A bulky article like that cannot be imported at all, with the duty at that rate. It may be that it would not be imported under any circumstances; and I only speak of it in order to call your attention to the fact t hat every- thin g is on the taxed side of the schedule, and not on the free list, that enters into the building of a house. All kinds of lumber used in house- building is taxed at various rates. Hemlock pays one dollar a thousand H. Mis. G 15 226 TARIFF COMMISSION. [E. I\ WHEELER. feet board measure, and a better class of lumber two dollars a thousand feet, and so on. We imported into this country during the last fiscal year lumber of this description to the amount of $6,279,541. It seems to me it might be worth the attention of the Commission to see whether any injustice would be done to the owners of American forests and those engaged in the first stages of that particular industry by repealing the duty on imported lumber. It is well known that our forests are rapidly diminishing, and that the very effect of this tax on the importer of lumber has been to increase the consumption of wood from our own forests, and the result has been to destroy them in many cases where they formerly existed. One of the results of this has been seen in the more continuous, protracted, and severe droughts w e experience during the summer season ; the effect of forests in the country, as is generally conceded, being to increase the rainfall. And I think if there is any- thing on the whole list in regard to which no bounty or benefit to be derived from a tax is found, it is a tax like this. Have we not in this country, in the benefits nature has given us, all the advantages that the owners of saw mills or planing-mills ought to ask, without this tax which makes so much increase in the cost of every house ? Because it is a fact that the difference in price between Canadian lumber and our own is the almost exact equivalent of the duty. I know that in some instances the effect of a duty is not to modify the price ; but I think you w 7 ill find when you come to examine the case that this is where the duty is prohibitory or nearly so. For example, suppose a duty is put at such a figure that it prohibits the importa- tion of a foreign article. Competition springs up in this country, and the effect of that competition is to give us the product at a cheaper price. As was mentioned by Mr. Jones in regard to the chemical in- dustries, where the price in this country was less than the rate of the duty, the effect of the duty is to prohibit the importation, and w*e are lelt entirely, therefore, to the competition between different manufacturers of that article in this country. But I do not think it is just to argue in that way, that the general effect of a duty that is not prohibitory is not .to in- crease prices. Take, for instance, steel rails : the difference between Liverpool and NewYork prices is almost exactly the duty. It is so in the instance of lumber as well, and it is generally so in cases wthere the duty is not a prohibitory oue, although there are a few exceptions. The duty on window 7 glass, which enters so largely into use in a house, varies according to the grade of the glass from a cent and a half to three cents a pound, and the effect of this duty when turned into an ad valo- rem scale is in many instances to prohibit, the importation altogether. In many instances it is almost 100 per cent., I am told. It is as to its effect in one particular that I would like to speak. The effect is the same as it is in regard to the compound duty on wool, that is, it dis- criminates in favor of the more costly and against the cheaper article, and that is a discrimination w hich does not seem to be defensible on prin- ciple. If there was any discrimination to be made, it would seem as though it ought to be made in favor of the cheaper article, used by poorer people and laboring men, who are unable to pay high prices. Yet in reference to glass as well as in reference to w r oolen goods, the tax is higher ad valorem upon the cheap article than it is upon the dear one. Take also the article of hardware, that enters into the construction of houses, and there is a flagrant instance of the injustice of the pres- ent system. The duty on wood screws is from eight to eleven cents a pound, and is in effect entirely prohibitory. That duty, as a matter of E. P. WHEELER.] CRUDE MATERIALS. 227 current history, was imposed at the instance of a manufactory in Provi- dence, the Wood Screw Company, and the effect of it has been to give to that single producer a bounty at the expense of all persons who use iLie article. I do not believe that we should import any considerable amount of English screws if the duty was reduced one-half. 1 am in- clined to think the machinery and skill at the control of the wood screw companies of this country would enable them to compete with foreign manufacturers if there was no duty at all. But I think a duty which gives to the producer a monopoly is not to be justified on any prin- ciple, particularly in an article of such universal necessity as this. There is not a house in America in which there is not a necessity for the use of this article, and I think it is certainly a great injustice to the con- sumers and to the purchasers of the article into which these screws enter as raw material, because that is not to be lost sight of. I think it is very important to be considered in any revision of the tariff. The raw material of one business is the product of another. The expense of the crude ore which is taken out of the earth is ehielly in the labor expended in the digging. And so 1 might enlarge upon this subject, but I think it unnecessary to do so. Without going into details, I should like to call your attention to the duty on lead pipe. That is a prohibitory duty. It is fixed at 2f cents a pound. We imported last year only $17,469 worth of lead pipe. This is an article that is easily manufactured. The lead is melted and put into a c\ linder and forced by a piston through a die which gives the size of the bore and the size of the exterior of the pipe. In order to benefit the lead-pipe makers of America this prohibitory duty has been imposed. A duty of a cent a pound on that pipe would put the manufacturers of lead pipe in a position in which they could compete successfully with t he foreign manufacturer, and at the same time it would reduce the price of lead pipe to every consumer in America, and to that extent benefit every house builder and every man who lives in a house. Again, we come to the subject of the marble used in the mantels of a house. The duty on this article is one of the largest and heaviest of our duties. It has been imposed in order to enable the quarry -men of Ver- mont to keep out foreign competition. I may say, in passing, that I am the owner of shares in a marble quarry in Vermont, and I know in re- gard to this matter from practical experience. The effect has been to give an undue bounty to that particular branch of American industry. Formerly, when this duty was first imposed as many of you are aware, the marble quarrying, the getting out of blocks, was done almost en- tirely by hand. The process is a very simple one. The rock, we will say, is a rough exposed surface like a cliff. The first thing is to clear away this rough surface and you get what is called a floor. The object is to have a smooth and even surface of stone. Formerly a number of mechanics were employed to drill at intervals all over this marble floor nntil it assumed the appearance of a checker-board, the size of the checkers being the size of the blocks. When the corner block had been raised, then they pried under and raised up each block separately. That is mostly done by machinery now, and the result is that the ex- pense of quarrying in Vermont is very slightly in advance of the expense of quarrying in Italy. But I think there are not many businesses in this country in which, under present conditions, the profits are greater than in the working of a good marble quarry in Vermont. Can you say how the effect of this specific duty of so much a foot on marble has operated to increase, unreasonably and unfairly, the profits of those engaged in the quarrying of it ? The cost of production has 228 TARIFF COMMISSION. [E. P. WHEELEB. diminished, bat the duty being a fixed one, and not varying according to the price of the imported article, the consumer does not get the bene- fit of the cheapness of the production as he ought to. I think we should consider what affects the producer and consumer alike, and should en- deavor to adjust these matters on an equitable basis ; therefore, I say, give to the house builders, and the people who live in houses, the benefit of the cheapness that has been brought about in the production of marble. Now, take the manufacture of tin-rooting plates; there the duty is 35 per cent., but these articles are almost entirely imported into this coun- try, and the importation last \ear amounted to $4,149,387. Why should not that duty be reduced ? That is a case where there is no American industry which would be prejudiced by a reduction of the duty, and it would benefit everybody who lives in cities where tin roofs are com- monly used instead of shingle roofs. Another article I desire to call your attention to is that of paint. This article is necessary in the finishing of all houses and in a great- many other ways, and enters into so many different branches of busi- ness that 1 fear I shall not have time to consider it in detail. I will, however, state a few facts in regard to the matter. In regard to red lead, white lead, and whiting, the duty on these three articles which enter so much into all ordinary branches of painting is practically a prohibitory one. The duty on red and white lead is three cents a pound, and the duty on whiting is one cent a pound dry and two cents a pound when ground in ods. We imported last year in red and white leads only $66,828 worth, and of whiting only $8,148 worth. Undoubtedly the amount of capital employed in the manufacture of paint in this country is very large and is burdened by the duty on chemicals, and I expect, you will have special applications from paint men to reduce the duty on the chemicals that enter into the manufacture of paints. On my general theory that the duty on raw material should, as far as pos- sible, be put at a low figure or repealed, I would favor any appli- cation like that. 1 think in that respect the manufacturers of red and white lead in this country deserve consideration, for they are heavily taxed by the duties on chemicals, and perhaps they should re- ceive some equivalent for this. Any duty that is a prohibitory duty and in its operation prevents importation altogether, giving no compe- tition between the American and foreign product in the markets of this country must of necessity be an excessive one. So much for building materials, although a good deal more could be said about that subject. The next topic I desire to call your attention to is an interest with which no one is more familiar than the president of this Commission, and 1 ought to apologize for saying anything at all about it under the cir- cumstances. However, I may be pardoned for saying a few words; and first, I understand that Mr. Constable, of the firm of Arnold, Constable & Co., will appear before you, and will have something to say on this subject. Therefore I will not go into details in regard to it, but I will say this: that the duty on manufactured wool is evidently arranged so as to be less on those wools which we do not produce to any considera- ble extent in this country than it is on those which we do. That certainly carries out the general suggestions I have made in regard to the true theory on which a tariff should be made; atid I suggest, respectfully, to the Commission that it would be a great relief to the carpet industry of this country if the duty on the third class of wools, known as carpet wools, could be abolished altogether. I find from the statistics of the census (Bulletin No. 289) that the carpet industry of this country used, E. P. WHEELER.] CRUDE MATERIALS. 229 during the census year, $34,008,252 worth of foreign wools, and only $2,023,318 worth of domestic wools. It is a matter of universal knowl- edge that the heavy or carpet wools are not grown in this country, and there is no particular likelihood that they ever will be grown in this country. The conditions of our agriculture are such that the growth of that particular kind of wool has not been attempted, and is not likely to be. Wli 5 r should not, then, the third class of wools, the heavy wools, be put on the free list'? That certainly would be a great benefit to the carpet manufacturers of America; and if this other suggestion made by Mr. Campbell to you should be carried out, and these aniline dyes should be put on the free list as well, the production of American carpets would be cheapened to such a degree that they could compete with great success in the South American market and in other markets. The goods we make are good in quality ; a great deal of money is ex- pended in designs for them, and I think any one who has examined the American carpets of recent make has been astonished at the amount of taste shown in the designs. There are many other articles of woolen manufacture in this country into which foreign wool enters to a large extent. In our worsted goods I find that the value of foreign wools used is more than fifteen million dollars, while the value of domestic wools was twenty-five million dol- lars. lint, without interfering at present in the duty on other classes of wools (for I would not go too fastor propose to make haste too rapidly), I have felt very stiongly that the benefit which would be done to the industries of this country by reducing the rates of duty in the directions that I have suggested, would be such that all classes of industry would be benefited, and that those who are included in the duties which are unchanged would find in many respects that it would be beneficial for them to submit to a corresponding reduction. However, I feel the im- portance $nd the complexity of the whole subject. I would not make any sudden or sweeping change if I could. All I would do would be to make changes on principle in the direction I have indicated, and to make them to such an extent that we might fairly test the value of the principle, and see, as I am sure we should, that it was sound, and that its results were beneficial. Now, another illustration in this connection, to show that the sugges- tions I am making are not simply theoretical, but are based on practical experience in this country. Down to the year 1872 there was a duty on hides. We got our hides from South America to a large degree, and made, leather of them. In that year the duty was taken off of hides, and the result was that our manufacturing industry very much increased, and that our exports of leather goods from this country, particularly to South America, have trebled in the ten years since the duty was taken off. Could there be a better illustration of the benefit that accrues to manufacturing industry, and indirectly to all the industries of the country by cheapness of production, and ability to compete in foreign markets, to increase the number of ships to be engaged, and to facilitate thetiafiic? They sell to us because we sell to them. I know that in commerce the direct way in which you pay for foreign goods is not by a direct exchange of commodities. But, take a merchant in South America who wishes to buy American shoes or saddles. He may draw a bill of exchange in payment for those goods, but he will provide for the payment of' them by the shipment of hides or something to this country. In its ultimate analysis it is an exchange of commodities, as all business is. The money that a professional man receives is money that lie receives for his brain labor; but this money he expends in buying the commodities of his clients and others. So that even there, 230 TARIFF COMMISSION. [E. P. WHEELER. when you come to tlie product of the mind, you have an exchange. And so it is in all business, and I think the more you can promote the expor- tation of our manufactured goods, the more we shall diminish our prices in this country, and the more benefit it will be to them as well as to ourselves. There is one other point in regard to the woolen industry — the spe- cific duty, or compound dut\, as it is called, on many kinds of woolen goods. Take clothing, for instance. There is a specific duty of 50 cents a pound, besides an ad valorem duty of 45 per cent. What is the re- sult*? You take a light expensive fabric made out of fine wool, and the duty is comparatively a moderate one. But you take a heavy article that a laboring man would wear, such as a pea jacket or a winter over- coat, and you find that the duty on that is 100 per cent, or more. Take the duty on blankets, on which there is a sliding scale of duty, but which does not sufficiently slide to meet the difficulty I am speaking of. The practical result is that we do not and cannot import the cheap grades of blankets, and we consequently have a heavier tax on the articles that are of prime necessity that we ought, especially in a changeable climate like this, than we have upon articles which are really articles of luxury used by the rich and not by the poor. I would not put any of these on the free list, but I would abolish the compound duty. I would make the whole duty a fair ad valorem duty. Bor my own part, I would suggest, with a great deal of respect to the Commission, that a duty of 50 per cent, ad valorem would be a very beneficial substitute for the present duty. It might increase the duty on some kinds of woolen goods; some of the finer grades would un- doubtedly be increased, but others would be largely diminished, and in regard to these the expense of the American product would be dimin- ished. If you give to the American manufacturers a cheapened pro- duction through a diminution in the duty on dye-stuffs, you enable them to compete in foreign markets, and at the same time to manufacture with just as much advantage as they do now, although the duty should be reduced in the way I have suggested. Let me make just one suggestion on the question of dye-stuffs. I want to call attention to the census bulletin in regard to the manufact- ure of chemicals. You will observe in regard to these dye-stuffs that they have almost entirely displaced the vegetable dyes. The duty in many cases amounts to more than 100 per cent, ad valorem. Even if it were possible for us in this country io prohibit lor the next ten years the importation of these colors, would it be a wise policy for us to do it, considering the extent to which you have been shown they enter into all manufactured goods'? Would it be a wise policy for us to build up a manufactory of aniline dyes in this country when they can be made more cheaply abroad because the raw material is found in a cheaper condition in England *? The English coal, as everybody knows, is richer in the hydro-carbons or inflammable matter than our American coal, and it is well known that we do import to some extent English coal to make gas, although the duty on it is a high one. The only objection that has been or could be made in regard to that would be that it we got into a war with some of the European countries we should be at a disadvantage in regard to these colors. I suggest that that is a very com in gent and remote disadvantage; that the probabilities of such a war are insignificant. These goods are made not only in England, but in Germany, and if the worst came to the worst, and we were cut off from our European supplies, we could fall back on the vegetable dyes that came from South and Central America before aniline dyes were invented. E. P. WHEELER.] CRUDE MATERIALS. 231 July 27, 1882. When I concluded yesterday the subject of the duty on building mate- rial, I had been speaking of the duty on paints. I had not then pre- pared some figures which I made ux> last night in reference to one particular grade of building material which enters so largely into plumbing; that is this matter of lead pipe. The manufacture of that article in this country has increased very largely, and did under the former tariff. In I860 I find that the value of the product of manu- factured lead and of lead pipe amounted to considerably over $3,000,000. In 1870, for the first time, 1 find them divided. Under the former tariff ot 1840 the duty on all manufactures of lead was 20 per cent., which was reduced to 15 xmr cent, in 1857. Yet we find a very marked increase in that period in the growth of the lead-mining interest and lead-manufac- turing interest. At that time lead ore was admitted free of duty, and it was not discovered that the mines of America were not able, even on that basis, to compete with the mines of Europe. In 1801 we had this duty imposed u})on this particular article of lead pipe of 2J cents a pound. That duty is practically prohibitory. The entire imports of all sorts of lead, including i>ii)e, amounted only to $L7,469 in the last fiscal year, and our exports of our domestic products amounted to only $39,710. But the entire product of lead x>ipe in this country ten years ago was over $12,000,000. I have not the figures for this year, but they are larger, for the use of plumbing has increased largely in building. I find, on figuring on the caxntal invested in the business at that time, taking the cost ot labor and material, that the x>rofit on the manufacture of lead j>ix>e m 1870 was about 50 x>er cent, on the capital invested ; and the cost of labor in the manufacture of that article, as I suggested yester- day, forms a very insignificant part of the exx>ense of the manufacture. The product of $12,000,000 and upwards was xnoduced with an expense ot labor of only $115,020, so almost exclusively is it the work of ma- chinery. There would not seem to be any justice in maintaining a x>rohibitory tariff on that very necessary and important article which is used, not simply in houses, but in conveying water from springs to farms and farm buildings in the country. There would seem to be no justice in maintaining a prohibitory duty on that to enable the manufacturers of lead pipe to keep their xnofit over 50 per cent, per annum. The duty under the old tariff was 20 per cent, ad valorem, and I would suggest respectfully to the Commission that, unless some good reason should appear that has not suggested itself to my mind, that would be a very fit rate of duty to restore. The business prospered under it, and while it has no doubt prospered since, yet it does not seem just to tax the entire body of consumers of the country to such an extent for the benefit of this great industry. That brings me to the subject of paint. In regard to that, there is very much that might be said. I will not undertake to say 7 it all, or even a large x>art of it. There are those who are engaged in the manu- facture who ax)i)reciate the details of the business more thoroughly than I do, and who will, no doubt, know in regard to the various ways in which the duty 7 on the materials they use enhances the expense of their production. I only 7 wish to call your attention to the subject of •paints used more particularly in building; that is to say, white and red lead, in order to xioint an argument in reference to the duty on lead ore and pig lead which now exists, and which is also a prohibitory duty. The duty on lead ore is cents, and on pig lead, 2 cents a pound. The x>roduction of lead and zinc x>aints in this country", in 1870, amount TARIFF COMMISSION. [E. 1\ WHEELER. 232 ed to $11,211,047. In 1861 it amounted to $2,574,955. That industry in this country has almost entirely sprung up since 1850. The entire production of paint in America in 1850 was only $77,000. There were only four establishments in the country, and their entire capital was $i3,000. But during those years, from 1850 to 1860, when lead was substantially on the free list, when the duty on pig lead was only 20 per cent, ad valorem, reduced to 15 per cent, in 1857, the business in- creased, as I have suggested, from $77,000 per annum to $2,574,000, an enormous growth. It has kept on increasing ever since. It is a profitable business, and makes an article of universal consumption, without which we cannot get along at all. 1 would suggest in reference to that, also, that if the dut 3 T on lead were reduced in the way I have suggested, that these two particular articles that are made from lead, and are made by comparatively simple processes, that is to say, red lead and white lead (which are those principally used in house painting), would bear a reduction of the duty of 3 cents a pound which now exists, and which is in itself a prohibitory duty. All these lead duties are prohibitory. The importation into this country was nothing substan- tially. The importation of white lead during the fiscal year was only 58,000 pounds, and of red lead 11,000 pounds. That was worth in the foreign market about 5£ cents a pound. A duty of 3 cents a pound is something more than 50 per cent, ad valorem. If the old rate were re- stored, and the reduction I suggest made in the crude article out of which this red paint is manufactured, it seems to me there would be a general benefit to the whole country; that the consumers would be benefited and the manufacturers would not be injured. I next come to the subject of paper; and in regard to that, some benefit has already been done by the putting of rags which are to be used in the manufacture of paper upon the free list; but the effect of that is shown in a very marked and extraordinary increase of the production of paper in this country. It is one of our verj’ prominent and leading industries. But there are two articles which enter very largely into the production and manufacture of paper that are taxed, and one of them is made largely in this country; the other is made here to a very limited extent. The first of these articles is wood pulp. I have not the figures in regard to that article for 1880. It is well known that the manufacture has increased largely since 1870. You will no doubt get the exact figures from the census bulletins, which are so useful, and which are coming out almost every day. But I find in 1870 the value of the wood-pulp product of this country was $4,959,191. The amount expended in wages was $260,419, which was considerably less than 10 per cent, of the product. The capital invested was $2,751,544, and the profit was about 40 per cent, on the capital invested. The duty of 20 per cent, on wood pulp is practically and in effect a prohibitory duty. It gives to the few manufacturers in this country a monopoly, because they have every advantage in themselves over the foreign product, ex- cepting simply in the article of wages, which, as I have shown you, forms so small a percentage of the expense of their business; the large part of the expense is in the material. The price of wood in this country is less than it is in any civilized country in the world except Canada. In Europe their forests have to be watched because they are limited; that is a necessity of their situation. With us, with our great unset- tled districts which nature has covered with pine trees and with all the trees of the forest, we enjoy the benefit, in this respect, of a very cheap material. There would not seem to be any very good reason why, in regard to this particular manufacture, there should be a duty E. P. WHEELER.] CRUDE MATERIALS. 233 which should shut out entirely all competition of the foreign article. I only advert to that, not because 1 suppose the foreign article, if you put wood pulp on the free list, would be largely exported to this coun- try, but it would put manufacturers here in competition with them, and would unquestionably reduce the price of the article made here; and with such profit as that shown by the census returns, there would seem to be no injustice in that. The other article which is very largely used in the manufacture of paper is one which our chemical friends are interested in. I refer to caustic soda. That is largely an article of import; we import a great deal more of that than we make. The imports of soda and its salts during the last fiscal year (and I have not been able from the tables that have been published to separate them) amounted to over $5,000,000. The entire product in this country, as shown by the Census Bulletin, is only $866,560, which is worth about 2^ cents a pound in this market on the average. The duty on caustic soda is 1J cents a pound, which you will perceive is almost 100 per cent, ad valorem, and it is more than 50 per cent, on the home valuation. When you consider that in the manu- facture of paper in this country the product in 1870 had reached over $48,000,000, and has very largely increased since then (though I am not able to give the exact figures, but feel sure that it must amount to at least $70,000,000), it would seem very unjust that all the manufacturers of paper should be taxed to this extent on the caustic soda that they use in order to encourage the manufacture here, winch, with all that discriminating duty existing for twenty years, has only reached the entire figure of $866,000, whereas the imports amount to over $5,000,000, and the industries which use these imports amount to $70,000,000. There is one other subject that was mentioned in the listwdiich I sent to the Commission (and you will observe that 1 am hastening so as not to take up more of your time than is desirable), and it is the last of them I shall call your attention to. It is the article of salt. This, too, is an import on which the duty has been somewhat reduced. Salt was on the free list from 1846 to 1861. The duty was raised in the first year of the war, and raised gradually until it reached 18 cents per hundred pounds on salt in bulk and 24 cents per hundred pounds on salt in sacks and barrels. This has since been reduced to 8 cents a hundred on salt in bulk and 12 cents a hundred on salt in sacks and barrels. Our Ameri- can product for 1880 amounted to $4,817,636. Our imports during the last fiscal year were $2,000,578, making the entire amount of salt used in this country approximately $7,000,000 during that year. The aver- age rate of duty, taking salt in bulk and in bags and barrels, as im- ported, was nearly 50 per cent. — 48.20 per cent. — so that the govern- ment received $1,000,447. Let us now look into the statistics of the salt industry. The first thing that strikes one is, that when this article was on the free list, our facilities for producing the salt were such that the manufacture was done at a profit. I remember, myself, as long ago as 1855, visiting the great salt works in the neighborhood of Syracuse, N. Y., and these manufac- tories were then thriving and vigorous, and making money. It is a fact which deserves to be considered that some grades of salt used largely in curing meats are not produced in this country at all ; Turk’s Island salt and other grades of salt of that description are required lor this purpose. Therefore, it is true to a considerable degree that the foreign article in any case would not compete with the American product, be- cause it is used for different purposes and has a different quality. On the other hand, having considered the duty and the product of this 234 TARIFF COMMISSION. [E. p. wheeler. necessary article, let us consider the question of the industry in which, to a very large extent, foreign salt is used, and to some extent domestic salt as well ; that is, the meat-curing industry, of this country. I did not realize, until I footed up the figures in the Census Bulletin, the enor- mous extent the meat-packing industry of this country has reached. In twelve cities of the United States alone the value of the product of meat packers during the census year was $191,920,345. Chicago leads the list, then comes New York, then Jersey City, then Cincinnati, and the others with lesser numbers ; but that is the aggregate, $191 ,920,345 All these enormous industries are compelled, in a large degree, to rely upon the foreign article of salt. This is a raw material to all intents and purposes; why not restore it to the free list? If we look to the capital invested in this salt business we find that the amount of capi- tal in 1880 was $8,225,740. How much less it is than the other in- dustry which employs the product. The cost of material amounted to $2,071,424 and the labor to $1,256,113, making an aggregate expense of $3,327,537 and the value of the product $4,817,636. So that we have a net product that year of $1,500,000 on an invested capital of $8,000,000 — a profit of about 16 per cent. While that profit is not as large as the lead-pipe people receive, owing to the fact that the duty on salt is more moderate and is not prohibitory, yet I would suggest it is an ample one and gives no cause for complaint, particularly when we consider the low rate of interest that is realized from invested capital now. And I suggest that putting salt on the free list would not deprive the manu- facturers of this country of the market which they enjoy, nor would it throw upon our market foreign salt to displace theirs, because theirs is a different grade and quality of salt, while the foreign salt is used chiefiy for another purpose. Having gone over this list which I suggested in my letter to the Commission, I desire to call attention for one moment, especially in view of the very forcible suggestions of your President, to the other indus- tries of the country. I think it is very important and desirable that while the manufacturing interest should receive its full share of atten- tion; while the skill, ingenuity, and enterprise of the American manu- facturer deserve all possible praise, still there are other industries of even greater importance, and to them some attention should be given. If you will go back through the census returns from the beginning, especially those for the years 1850, 1860, and 1870, as well as the last census, you will find that the agricultural products of this country are greatly in excess of the products of its manufactories. For example, in 1870 we find the cash value of the farms of this country amounted to over $9,000,000,000. The capital invested in manufactories at that time amounted to $2,000,000,000. I find that the products of the agri- cultural industry have gone on increasing, and that the product during the last census year was over $1,000,600,000 — $1,677,813,410 — and that the number of acres on which crops were raised amounted to 132,074,841. I find that the. average product of the nine years from 1870 down to 1879 was $1,420,000,000, and it is a most remarkable fact that the aver- age product per acre during that decade was very uniform indeed. The product per acre last year amounted to $12.70, and the average for the whole ten years varied from that only 26 cents. While the percentage goes up or down a little, yet it is, perhaps, as uniform and stable in its results as it is in any business. Of course the persons employed on these farms and engaged in producing this enormous result have a claim upon the attention of your Commission. Ninety per cent, of our exportation to foreign countries consists of agricultural products, aud E. P WHEELER. 1 CRUDE MATERIALS. 235 it is with the results of these shipments that we paid for all our imports. Perhaps one of the most useful results of the Commission may be this: that the outcry that is unquestionably arising from those engaged in agricultural pursuits for a modification and revision of the tariff will receive an intelligent answer. It is not desirable that this question of the revision of the tariff* should come as a result of a great popular outcry and uprising, because things done on account of such clamor often result in hasty and rashly advised legislation, and do more harm than good. But sitting here calmly, to hear the various manufacturing and other industries of the country as they come before you, you have an opportunity of going into the details and of arriving at results never yet obtained in this country. It is very necessary that you should hear in detail these manufacturers and others, because it is the details of the tariff*, as Assistant Secretary French explained this morning, that affect very greatly the results to be arrived at, and the effect upon business. But I think that you have advantages that no Commission has ever had before, and that you will be able to revise the tariff* and so adjust it that the agricultural interest can be brought in accord with the manufactur- ing interest. While it was a part of the theory of the law creating the Commission that the general tariff* system should not be disturbed, yet, on the other hand, I think that the law creating the Commission was the result of a general feeling that there were inconsistencies in the tariff* that ought to be corrected, which had been the result of special legislation, and that an intelligent and impartial commission would prune, away these inconsistencies and remove these defects and give us a more fair and impartial system. There have been several things said since I have been here, by other gentlemen who have appeared before you, and I have been very much interested in the discussion I have heard, and while I appreciate the la- bor before the Commission and do not desire to occupy any unnecessary time, there have been some things said about which I wish to speak be- fore I close. Let me commence w r ith one of the first topics I began with yesterday ; the subject of nickel. We were all very much interested in what Mr. Wharton told you yesterday on that subject. But he does not admit the fact that I stated yesterday, that the immediate effect of the increase of the duty was to increase the price of the article on which it was imposed. My statement was based upon what I had been told by the manufacturers who use the article, and I shall endeavor to ar- range the matter so that at least one of these gentlemen can come be- fore you and be heard at some future sitting. I do not know that the fact in itself is a matter of very great importance, because, after all, the question in regard to the duty on nickel is simply this : Is it possible, if the duty on nickel were reduced to 20 cents on the pure article as w T ell as on the alloy, to do the business in this country at a profit ? 1 think that statement of the case Mr. Wharton himself would not object to. He told us yesterday that he proposed to close up his works pend- ing the agitation of this question for a modification of the tariff* so as to increase the duty on the alloy and make it the same as on the pure article. But he did not state that the business could not be done here at a profit; he gave you no figures in regard to it. I suppose it is a fact that when the census returns on nickel appear you can answer all these questions, but they have not been answered yet. I could not help being interested by the frankness shown by the manufacturers of quinine who appeared before you to-day. They recog- nize the fact that gentlemen who apply to this Commission or to Con- gress for a modification of the tariff* ought to show what their business 236 TARIFF COMMISSION. [E. P. WHEELER. is. They put themselves in this position : they say substantially to you or to Congress, u Our business is such that we need a change. We ask for a benefit to be derived from legislation,” and if they do that it is no more than just — it is not at all interfering with their private af- fairs — that they should state distinctly and definitely facts in regard to their business, the cost of production, labor, and, material, and all those facts that enter into the management of their business. And I think if Mr. Wharton had gone into those details he would have satis- fied you that if he could not make as much money out of the business with the duty at 20 cents as at 30 cents per pound yet he could continue it profit a bly. There was one statement that Assistant Secretary French made this morning to which I agree, and that is that the duty on alloy of nickel and copper ought to be the same as on the pure article. Whether it was the right thing for the importers to evade the provisions of the statute by mixing a little copper with a good deal of nickel is not a question perhaps worth while to consider now. But it is no more than just to put those two articles on the same basis, as I think any one would concede in the present condition of that manufacture. There was one fact in regard to the nickel business which was not contested, which settles the whole question satisfactorily on another branch of manufacture ; that is the fact that the company I mentioned yesterday, the Meriden Britannia Company, established a factory in Canada in order to be able to supply the foreign market. They must have done that because they could manufacture cheaper there than here. There is no great difference in any particular between the conditions in Canada and this country except in that particular thing. Yet the effect of that difference was sufficient to induce them to go there instead of keeping their works at Meriden, where they have the best facilities for manufacturing that could possibly be obtained. Something was said also by Mr. Wharton about copper; but the only copper export he could cite was cartridges, and I confess I think the argument he drew was rather tenuous. Copper is used as the envelope of cartridges, but cartridges are not exported because they are made of copper. The reason they are exported is because, in the first place, the American fire-arms are the best in the world and they are the only cart- ridges that can be used with American fire-arms, and every country or individual who buys the fire-arms must buy the cartridges to go with them. I do not think that any man can fairly consider cartridges as a manufacture of copper; I do not think any one would claim they were. The entire amount of copper exported in 1880 amounted only to 838,000, so that it cannot be said there is any export business done in copper. Then, in regard to this matter of steel rails, which is undoubtedly a matter of great importance. There was no reason suggested by our very intelligent friend why the duty on steel rails should be more than the duty on iron rails, and it seems io me that that is a fair iest with regard to it. The duty on iron rails is that which I pointed out, and is for the present a fair standard. As I suggested, there is no reason why one should be put at a higher rate than the other. It cannot be denied that the price of steel rails has very much diminished, but that is not owing to the tariff*; it is owing to improvement in methods of production. The price has diminished abroad even more than it has here, and the effect of the large duty of 828 a ton on rails has simply been to prevent that reduction in the cost of production from having its full effect. In regard to one suggestion which was made, which goes to the whole root of the matter, that it was the object of the government to lay a tax E. P. WHEELER.] CRUDE MATERIALS. 237 to enable people to do a business which would be profitable, which other- wise would not be profitable, I will say this : Where that applies to large amounts of money invested, that is one thing; but where it ap- plies to a creating of a new business that is not necessary and that the country can do without, we should pause before committing ourselves to that proposition. If there were an embargo, and we could not import anything, I suppose all sorts of industries would spring up here at once. In regard to the aniline dyes, it was said to be a poisonous business, and the people engaged in it suffered very much on account of the poi- sonous materials used. If that is so, why should we desire to build up a business of that kind*? The gentleman from Albany, Mr. Hendrick, spoke of a 35 per cent, ad valorem duty. Certainly, in the present con- dition of that business, considering the existing rate, I should not con- test that proposition, so far as the aniline reds are concerned ; I should not oppose, but consider it just to put the duty at that figure. But I should object to keeping all aniline dyes at the rate of 35 per cent, so that Mr. Hendrick might be enabled to build up a new business for the purpose of increasing the cost of all articles that are made with those dyes. There are one or two other subjects with which I have had practical familiarity as a lawyer. In the first place, I would like to say that I was a good deal surprised at the suggestion made yesterday, that our custom-house officials generally sympathize with the importers. That is not an impression that prevails in the minds of the importers them- selves or in the minds of their counsel. We may be wrong. The general impression I have observed is, that the custom-house officials sympa- thize with the government, and. that the importers’ chances of success are always better before a judge and jury than when the result depends upon the custom-house officials. I think it is a mistake to say that the custom-house officers sympathize with the importers. If there is any- thing in the suggestion at all it shows as a result that the high rate of duty creates a suspicion in the minds of all parties; the importers do not feel fairly dealt with, and the manufacturers have a somewhat simi- lar feeling. I had thought of suggesting something to the commission in regard to the matter of home valuation that Assistant Secretary French spoke to you about, but I hardly wanted to propose so radical a change. However, since he has introduced the subject, I would say that as the result of some experience in regard to advising with clients, I think it would greatly simplify the whole custom-house business and put it on a fair, equitable basis with all parties, if we were to adopt the home valua- tion as the standard. Of course, this would greatly increase the labors of the commission. It would require the reconstruction of the whole tariff, especially in reference to specific duties, because they bear a different ratio to the foreign valuation from what they would to the American valuation. It would require a large reduction in your ad- valorem duties to keep them at the present rate. Take the duty on steel rails, which is a specific duty. It is about 100 per cent, on the foreign value and 50 per cent, on the American value. You would find their rate on the list would have to be changed, if you adopt that suggestion ; but if you were to undertake the labor I think you would confer a great public benefit. If the duty w T ere put on the basis of American valuation in the end the country would profit by the change. There is one suggestion I have often heard made by importers, ancl I nave seen it tested in cases coming up in the courts, aud that is, the injustice of the present provision in regard to the cost of merclian- 238 TARIFF COMMISSION. [E. P. WHEELER. dise. Mr. French read you a section this morning which requires the appraisers to fix the dutiable value as the market value in the country from which the goods are imported. But then there is a provision in two other sections which modifies that. Section 2854 of the Revised Statutes requires the importer, if he has purchased the goods, to state in his invoice the cost. But section 2900 provides that the duty is not to be assessed on a less value than the invoiced figure. The effect of that is that if a man buys goods abroad and the price goes down he pays still not on the market value, but on the cost to him. But if the price goes up he has to pay on the increased market value. I know of a particular instance where that provision in regard to steel rails operated very unjustly. There were merchants in this country who had bought steel rails at prices they had to pay before the expiration of the Bessemer patent, when the royalty entered into the price of the rails, yet they did not get them actually entered here until after the market rate had gone doAvn a pound to the ton. Notwithstanding that they had to pay duty on the cost of those rails, and it put them at a great disadvantage as against their competitors in this country who had purchased at a lower figure. I would suggest that no harm or injustice could be done to anybody if the provision that the duty should not be assessed at less than the market value should be stricken out of section 2900, so that in all cases the test should be the market value, and if the importer lost on his goods he would get at least a reduction on the amount he had to pay. In regard to specific and ad-valorem duties, I would like to say this: I agree with Judge French that you ought not to have both ad- valorem and specific duties. Compound duties are very injurious indeed. One thing has occurred to me as meeting the objections made to specific duties in cases where you find it necessary to impose them. Suppose a similar provision to that which is found in the tariff on woolen goods were made a general provision, but with somewhat different language. You will find it on page 163 of Heyl’s Digest; that is in reference to iron, and there is a similar provision in regard to wool also. Suppose it was provided in regard to certain specific duties that no article should pay a greater rate of duty than 50 per cent, ad- valorem upon the market value in the ports of the country from which it was exported. 1 mention that as a suggestion. It would equalize to some extent the injustice which has been done in some cases by the continuance of a specific duty when there was a great change in the price of the article, and when, as in two of the instances that have been mentioned, aniline dyes and steel rails, the price had fallen as much as 100 per cent., owing to the cheap- ening of the cost of production, and in which the whole intention of the original act was perverted and changed by reason of the changes in the condition of the business that could not have been foreseen. Nobody can tell to-day how production can be cheapened. Therefore I say, in cases where it is considered expedient and necessary to fix specific du- ties, if you put some limit on the percentage of those duties you would remove great difficulties. In other respects they are desirable, because they are simple, easily fixed and collected. In conclusion, I desire to make this suggestion, and I think it is a matter which must have influenced Congress in passing the law for your creation. In this country we are met with a great surplus. It is very important for the country that that surplus should not continue. Our whole financial system now rests upon our bank system. It is a very good system. It has given us a uniform currency all over the country. We can all probably remember when a bill of a bank in the E. P. WHEELS ii.] CRUDE MATERIALS. 239 city of New York would uot pass current in Northern New England; you could not pass it at all, much less could you pass a Western bank bill. The national bank system has, in my opinion, had the elfect of uniting this country in one union more than any other thing that can possibly be named, in the facility it has given of enabling the bills issued by any one portion to be accepted without question in any other portion of the country. This system of national banks rests entirely on the national debt, and when that national debt will be extinguished, as in the remote future it will be, nobody has suggested any practical or uni form basis on which that currency can rest. Therefore this is a fair subject for consideration when you come to consider, as you will have to consider, the effect of the reduction of the revenues of the country, the effect of putting this or that article on the free list. I think this subject of a surplus is a fair subject for your consideration. I know you are not a legislative body, yet you are an advisory body to a legisla- ture, and you are in a position where you can give advice from an intel- ligent standpoint, and therefore I think it is a matter that can fairly enter into your deliberation when you consider that every article you put on the free list produces to that extent a diminution of the reve- nues and tends to postpone the time when our children will be brought face to face with the question, What are we going to do with our cur- rency and our national bank system ? Do not let us bring that aboot too soon. But it is very important to be considered in reference to this particular matter that a reduction of duty does not always imply a re- duction of revenues. Very often it leads to an increased importation. But every article that is put on the free list is a reduction of revenue and, as a consequence, tends to a reduction of the surplus. I am much obliged to the Commission for the attention with which they have listened to me. By Commissioner Garland: Question. Have you estimated the amount of the reduction contem- plated in your argument ? — Answer. 1 am not able to give you the figures at present, but whenever I have an opportunity to prepare them, 1 will take pleasure in presenting them to the Commission. I intend to pre- pare some tables, and will send copies of them to the Commiseion, and will show in them approximately, as near as I can, what the effect on the revenues will be of the reductions suggested. By Commissioner Underwood : Q. Do you think we ought to retain and continue the internal-revenue system ? — A. I think so. Q. In that case there would not be the same necessity for retaining the jncsent duties on imports. — A. It is my opinion that one of the last things that the country will consent to touch in the way of taxation is the excise duty on whisky and on liquors of every description. Q. Have you taken into consideration the fact that two thirds of all the whisky made is used for manufactuiing purposes l — A. 1 did not suppose the percentage was as large as that. I think a system of draw- backs, like that, for instance, in regard to the article of salt for the curing of fish, ought to be given, and that would meet some of the difficulties, perhaps, of the quinine manufacturers, if it was applied to their industry. By Commissioner Porter: Q. I understood you to say that the profits in the lead business and the paper business were forty to fifty per cent, on the capital invested. Please explain to the commission the method by which you arrive at 240 TARIFF COMMISSION. | E. P. WHEELER. that result. — A. The method I adopted in arriving at that was this: I find from the returns that there was a certain amount of capital invested in the manufacture of lead pipe, $2,054,000 ; and I also find the cost of material which was used in the manufacture during the given year was $9,300,000, and that the cost of labor was $115,000. Adding t he cost of material to the cost of labor it gives, as the expense of running the business during that time, $9,000,000. I find that the valuation of the product was $12,500,000; that was the income. Q. But do you consider that a fair way to estimate the profits? — A. It seems to me that the difference between the income and the outgo gives the net result of the business. Of course, there is an invested capital that ought to have a return. Commissioner Porter. That is the very thing I refer to. Commissioner Ambler. And there should also be considered the question of the wear and tear, and the destruction of the plant. The Witness. Certainly, all those things are to be considered. If you were, for example, to allow ten per cent, as a fair rate of interest on the money invested in manufacturing pursuits, you would have to de- duct that ten per cent, from the net returns as shown in the table, and whatever amount is necessary for wear and tear ought to be deducted. But where the income shows a gain of 50 per cent, upon the the capital as compared with the outgo, there is a great margin to cover all those items. By Commissioner Oliver : Q. I understood you to state that the interest on borrowed capital in this country at the present time was about thq same rate as paid in England, for instance. — A. It is in our commercial centers in the East, but not in the West. Q. You used the expression “in this country.” Commercial paper in England rules from 2J to 3 per cent., while in this country the minimum rate would be about 6 per cent., taking the average rate throughout the country. The published rate of interest in New York is not the real rate of interest. I think that is an error, which I desire to call your attention to. — A. Undoubtedly that particular kind of interest is greater than I have stated. But still the time has been within a year, I think it is so to-day, in New York, when good prime paper has been discounted at 5 per cent. Money can be borrowed on call at 3 per cent., and time loans can be made at 5 per cent., and the rate of interest on bond and mortgage, which seems to me to be the fairest basis for the calculation, is 4 to 4^ per cent.; transactions at 5 percent, are common. I think there has been a similar reduction in the West. I am trustee for prop- erty, and have put out considerable money in the West. I used to get 9 per cent, on Chicago loans, but you cannot get more than G per cent, there now. Going further west, to Minnesota, for instance, on good property you cannot get more than 7 per cent. You do sometimes get more than that, but you have to take less valuable property for security. Q. Would not the average beG percent., makingit twice theamount? — A. Perhaps so. I ought to have guarded my statement a little more in that respect. I had more particularly in my mind the rate of interest on government and call loans, which, I think, is about the same. But it does not approximate so closely in those other particulars you speak of. PHILIP A. BOUR.j ALKALIES. 241 PHILIP A. BOUR. Lonh Branch, N. J., July 26, 1882. Mr. Philip A. Bour, representing the Pennsylvania Salt Manufact- uring Company, appeared before the Commission in response to its invi- tation and made the following statement : Mr. President and Gentlemen of the Commission: In the few moments which I shall consume in addressing the Commission I will en- deavor to state, as concisely as possible, the facts bearing upon the industry which I have the honor of representing, and shall afterwards be happy to answer any question that any member of the Commission may see fit to put to me. The vastness of the chemical industry in this country was brought to your notice a few days ago by the secretary of the Manufacturing Chem- ists 7 Association of the United States, Mr. Henry Bower, of Philadel- phia. The alkali and alum industries are among the largest embraced in the account given you, and I propose to give you some facts and figures connected with them. I might state here that I am associated with probably the largest alkali works in America. Their output of manufactured goods during 1881 amounted to nearly 70,060 tons, and they handled something like 90,000 tons of raw material, besides directly and indirectly they gave support to nearly 5,000 people, and the average wages paid amounted to $45 per month. The working people all have comfortable h#mes, many owning their dwelling houses. Bents average about $5 per month. -Employment is given the year round, and the factory has not been stopped but once in many years, and is constantly being increased in size. Nearly three millions of dollars have been ex- pended, and 30 acres of buildings have been erected, it being found that goods would cost less, the greater the volume of out-turn. The com- bined capacity of the alkali, alum, and acid works of the United States I believe amounts to upwards of 600,000,000 of pounds. Twenty years ago, and before the passage of the present tariff act, it did not amount to 20,000,000 of pounds, the supplies almost exclusively coming from En- gland. Let us compare the prices of some articles extensively used by our people when under little or no duty, with the prices prevailing under a duty equivalent to about 40 per cent, on alum and 60 per cent, on sodas, bicarbonate and caustic, and about 20 per cent, on soda crystals. The price of foreign bicarb of soda with a duty of three-tenths of a cent per pound was 4.8 cents. With a duty of 1J cents per pound the selling price of American bicarbonate of soda, superior in quality to the foreign, is 2J to 2£ cents per pound. Foreign caustic soda, with a duty of one- quarter of a cent per pound, sold at an average of 7£ cents. Now, with a duty of l\ cents per pound, the selling price is 3J cents. The selling price of common alum with no duty was 3J cents per pound. With a duty of six tenths of a cent a pound the selling price is 1£ cents. Soda crystals sold as high as 3 cents with no duty, and sells now at 1 t l cents with a duty of one-quarter cent per pound. America was the best cus- tomer England, France, and Germany had in the alkali trade, and those countries reaped a wonderful harvest prior to our levying duties and pending our construction of works. Desperate efforts have been made to crush the industries here, but it is believed they can stand under the existing tariff. The sacrifices of the English alkali works especially have been very great, and I was informed a few days since by a large alkali-maker there that only two soda factories in England paid, a profit in 1881, and they H. Mis. 6 16 242 TARIFF COMMISSION. (PHILIP A. BOTIR. attribute their reverses to loss of their American trade and the depre- ciation in prices consequent on large surplus production. The prices of American soda and alum have reached very low figures, however, and a change of one-tenth of a cent on any of the articles named would entail loss upon the manufacturers. The alkali tariffis all specific, and pays the government annually a million and a half dollars. Any re- duction would be the means of assisting the foreign factories at the ex- pense of the American factories and a loss of revenue to the govern- ment. There is another point in connection with caustic soda that I would like to call your attention to. When the tariff laws were framed all the caustic arriving in this country was GO- per cent., or standard, and paid 14 cents per pound. To lessen the duty and sea freight, for- eign manufacturers conceived the idea of concentrating and bringiugit up to 75 per cent. This, in reality, brought the duty down to about 1.2 cents per pound. So Avith soda ash. The bulk of the importations formerly tested 48 per cent, standard ; now they test 58 per cent. The real duty, therefore, instead of one-fourth of a cent, is only a fraction over one-fifth cent per pound. Yet, under the tariff of 1872, it provides that natron, or carbonate of soda, should pay one-half cent per pound. Yow, as pure soda ash, or 58° ash is natron, it should pay 4 cent in place of J cent per pound. If the correct interpretation had been given this by the Treasury officials, I firmly believe there would be a dozen soda- ash factories where there is not one in operation to-day in this country. Our total supply, amounting to 140,000 tons annually, is now received from Europe. In case of war, or high freight rates, or short supplies, the price could be run up to high figures, as in the yeai%!865, owing to short shipments, the price jumped from 2.93 cents to 12 cents per pound, a sudden advance of 3094 per cent: thus showing in a striking manner the effect of an entire dependence upon a foreign country for a manu- factured article that must be had at any price. I desire to show you how little glass, soap, and paper would be affected if the duty was increased from a quarter to a half cent per pound. Those articles take the principal portion of the soda ash imported. It would increase the cost of glass about one-sixteenth of a cent per pound'; or, in. other words, an ordinary pane of glass 8 by 10 inches would be in- creased only one-fortieth of a cent. The increase of one-fourth of a cent on soda ash would increase the cost of soap one-twentieth of a cent per pound. It would add only^me- eighth of a cent per pound to the cost of white paper, equivalent to an increase of not more than one-eightieth of a cent on a sheet of paper of the size and weight of the Yew York Times. How lightly the tax bears on these articles I have fully shown, and if the consumer wants a continuance of low prices, which are lower now than ever before, in my opinion, there is no way more sure to accomplish it than by fostering home industries. We invite honorable and fair competition, but when manufacturers abroad say, as oue said to me a short time ago, “We Avill yet make you American manufacturers gnaw your finger ends,” it is quite time we made up our minds to remain at least as independent as we are, and see to it that no backward steps are taken. In conclusion, I would say that we are preparing a schedule of duties on alkali, and shall ask permission to submit the same to you at an early day, accompanied by the necessary reasons we bare to give. If the Commission desires to question me on any branch of this sub- ject, 1 shall be happy to respond to the best of my ability. Commissioner Oliver. We shall probably want to ask you some ques- tions when you present your schedule. CHARLES T. WHITE. J QUININE. 243 CHARLES T. WHITE. Lono Branch, NT. J., July 27, 1882. Mr. Charles T. White, of New York City, representing the chem- ical industry, appeared before the Commission aud made the following statement: Gentlemen: I do not desire to occupy much of your time in speak- ing of our particular industry, as there are other representatives present who can present additional facts that I may overlook. We find our- selves in rather a peculiar position. I am not quite sure that any other industry will come before you under exactly the same conditions as those by which we are surrounded. Ours is a business, as you are perhaps aware, which requires a long time for its establishment, and peculiar fitness in its prosecution, most of the articles in our line being, as is well known, used for medicinal purposes, and therefore the business should be in responsible hands. Consequently we feel that we are enti- tled to a fair share of the privileges and advantages that the country is willing to allot to any of its industries. I think that the records of our establishments, some of them dating as far back as 50 years, will be found to be such in regard to the conduct of the business and the articles presented to the public, particularly as regards this article of quinine, as should gain us the respect and confidence of every one. We find ourselves to-day in this position. In July, 1879, unexpectedly to us (except that we knew that much agitation had been going on in regard to the matter), the duty upon quinine was summarily taken off, a duty of only 20 per cent. This was done just at the close of a session of Congress, when those who were familiar with the facts of the case were not present to explain the matter. The only reason we could ascertain for this was the idea that was urged upon Congress that medicine ought to be made cheaply and furnished cheaply to the people, which was cer- tainly a proper conclusion if it was a just one, but one which would affect many other industries of importance in this country, as few peo- ple of capital and intelligence would go into a business unless they had an idea that there would be a fair remuneration for the work they were to do. This is our position in regard to foreign competition, which has been brought upon us in such a way as to greatly injure our interests. Eu- rope produces a large quantity of quinine, a great proportion of which now comes to this country. The wages we have to pay here are one- third more than the wages paid in Great Britain, and one half more than the wages paid on the continent of Europe. The articles we use in the reduction of the cinchona barks are taxed on an average of 50 per cent., and the general expenses of the management of the business, as you are all well aware, are much above those of Europe. The European manufacturers in the short time they have had since the repeal of the duty have so changed our position that from being the first quinine-producing country in the world, we are now only a third- rate producing country in that article, and this year the amount of foreign quinine which is to come into this country will be nearly, if not quite, one-half of the whole amount that is consumed here. 244 TARIFF COMMISSION. [CHAULES T. WHITE. Then there is another disadvantage under which we labor, and a very important one, too. Formerly we equaled the European manufacturers in the receipt of Cinchona bark. In 1874-’75-’76 we received a& many bales of the bark as they did in Europe. In 1880, following the aboli- tion of the duty, we received only one-third of the amount they received there. It was well known by the shippers of South American barks that the duty was taken off here, and that we could not compete, and they saw the advisability of diverting their shipments of bark from this country to foreign countries, so that in the year following they only sent us one-third of the amount as compared with the amount that Europe received, and in the next year only one fourth of the amount; and as the production of quinine depends on a careful analysis of the bark and the selection from a wide range of barks, we are, therefore, at a serious disadvantage. They have been sending barks of a better value to Eu- rope because the manufacturers there, owing to our open market, were ready to use the higher- grade barks so as to increase their product without having to enlarge their apparatus. Then there is another point which is worthy of notice. These barks were sold here by commission-houses. They received a very considerable amount for themselves and the coun- try in the way of commissions, and large amounts of the receipts were returned to South America in the products of our own country instead of money. A large part of that trade is n<3w being done in Europe. I think that we are entitled to careful consideration at your hands. We ask for nothing but simple justice, and I am happy to say that we have with us to-day such well-known chemical manufacturers as Mr. Rob- bins, of New York, and Mr. Rosengarten, of Philadelphia, both princi- pals of their own establishments and experts in their line, and I hope you will question them in regard to any matter on which you desire in- formation that relates to the business. We ask protection so that we may at least stand on a par with European manufacturers and not be driven out of the business entirely. By Commissioner M’Mahon : Q. What rate of duty do you recommend? — A. One of the gentlemen who has addressed you to-day has said that he was in favor of letting well enough alone. I differ with him, as he represented an industry well- protected, and ours is unprotected. We should be in a position where we can have some slight protection. If we can have all the duties that now exist on the articles we use removed, a 10 p^r cent, protection would be helpful to us. Without the removal of such duties we should have at least 15 per cent.*, and this, 1 think, cannot be considered as an excessive rate of protection. C. A. EOBBINS.] QUININE. 245 C. A. BOBBINS. Long Branch, N. J., July 27, 1882. Mr. C. A. Bobbins, of the firm of McKesson & Bobbins, of New York City, druggists and quinine manufacturers, appeared before the Com- mission and made the following statement: Mr. President and Gentlemen of the Commission : Mr. White has stated our case very well, but I desire to say that Mr. Bosengarten and myself are both here as manufacturers of chemicals, to answer any questions you may be pleased to ask in regard to the details of our busi- ness. In presenting our case in Washington some time ago, we were in- terrogated on these points, and it has occurred to me that perhaps the Commission would like to put some questions to us also, on points it is desired to have developed. What Mr. White has said is entirely correct. Before the removal of this duty we had one factory here that produced more quinine than any other in the world. It must be taken into consideration that the entire production of quinine in the world is in the neighborhood of four million ounces, and that the United States this year will use sixteen hundred thousand ounces. Therefore we use over one-third of the entire produc- tion of the world. We have five factories in this country, some of them small. There are about thirteen in Europe. At the time of the removal of the duty there was a factory in Milan which was doing a considera- ble business, but it was much inferior in its productive capacity to one of our American factories. That factory has consolidated with others now, so that it produces more than one-half of the quinine used in the world^ and practically dictates to us here the x>riee at which we shall sell our quinine, and tells the men here and in Europe the price at which they shall hold their barks. Their method of doing business is, for many reasons, such that they can produce tbeir quinine at about one- half the price that we can produce ours here. The essentials for the manufacture of quinine are practically three. First, the cinchona bark. We grind that bark, and treat it with alkali, which renders the alkaloid soluble, and then we treat it with a liquid to extract it. At present we use South American and East Indian bark; of the East Indian bark we use very little, because of the duty of 10 per cent. That tax comes olf, however, on the 1st of January next. But we shall be very much hampered, because England has spent large sums of money in the establishment of plantations in Ceylon and Jamaica for the cultivation of the cinchona bark. The plantations of Ceylon are estimated to contain 100,000,000 trees. The bark ranges in value from 2 cents to $3.75, and from its external appearance jon could not tell anything more about it than you could about the gold contained in a piece of gold ore. All that bark is sent to England to be sold at pub- lic auction, necessarily, it being owned by the government. Therefore, if we want to compete with those barks, we have to send our private analyst over there to examine them, which is very expensive, while these men in Europe have the bark sent to them, and they return their analysis, and buy accordingly. On our alkalies the tax is 35 to 40 per cent. On our solvents we are taxed also. We use a solvent called fusel oil, which is 246 TARIFF COMMISSION. [C. A. ROBBINS. an alcohol. That is subject to a duty, if we import it, of $2 per gallon. If we do not import it we use the fusel oil that is obtained here. We can buy it in Canada at 18 cents a gallon, or in Europe at the same price ; but we are obliged to pay 35 to 40 cents a gallon for it on account of this duty. So that we are taxed on that article over 100 per cent.; we are taxed on our bark, we are taxed on our alkali, and then we are taxed on our solvents. Then comes the machinery to make it. In my own factory, using 200,000 ounces of quinine a year, we have 32 boilers 18 feet high and 4 feet wide, 32 of smaller dimensions, about 2 miles of pipe, and three engines. These things all go to waste quickly because of the acids which are used in the production, and those are all more expensive than in Europe. We cannot compete upon equal terms with the foreign manufacturer on the present basis. The manufacturer in Europe, before the duty was taken off, had more or less advantage over us, but now that consolidation of which I spoke will control over one-half of the quinine sold in the world, and I think one-third of all the quinine that will be sold to the United States this year will come out of Europe. By Commissioner Ambler : Question. You spoke of the cost of production being doubled. Do you iuean the general cost of production, or are you referring only to wages? — Answer. I mean the general cost of production. If it costs $10 a bale here to work the bark, it would cost only $5 to do the same thing in Europe. It is very much like reducing gold ores. If a bale of the bark contains three per cent, of quinine, it costs no more to get it out than if it contains one-half or one per cent, of quinine. You have got to work so much of the crude material. By Commissioner Underwood : Q. What was the price of quinine by the ounce before this duty was reduced? — A. I have the figures here. In round numbers it was be- tween three and four dollars an ounce. Q. What was the price after the reduction, and what is it now*? — A. The immediate effect of the reduction of the duty on quinine was to ad- vance the price. When the duty was reduced in 1870, the price was ranging from $3.60 to $3.40, and in 1880 the price ranged from $3.25 to $2.25. Q. What is the price now ? — A. The price of quinine is now $2. Q. What would be the effect of an imposition of duty on quinine of 20 per cent, now ? — A. In a general way, I do not think a duty on or off quinine would materially change the price. We are entirely governed by the supply of bark, which is our crude material. Q. Does not the bark come in free of duty now ? — A. The bark from South America comes in free. On the bark that is imported from the East Indies we still pay a duty of 10 per cent., and shall continue to until the 1st of January next. Q. You are manufacturers of quinine, and you still continue the busi- ness? — A. Yes, sir. Q. Do you think the imposition of a duty upon quinine would reduce the price of the quinine that you sell ? — A. No, sir. Q. Would it increase it t — A. 1 say that I do not think that the impo- sition of a duty would have any material effect upon the price to the consumer. Q. Then why do you want it ? — A. Because it would help us in com- peting with the manufacturer abroad. The tacts are, generally, these : C. A. ROBBINS.] QUININE. 247 Tlie foreign manufacturer makes his product for a year at a certain price. He finds that he has a surplus of quinine, and he says, U I cannot sell this quinine here, because I have to supply my customers at a certain price, and I want to send it as far away as I can to sell it.” And he sends it to America, and, as a consequence, we have the surplusage of the quinine manufacturers of all Europe. Q. Is not that true in reference to any other article that is manufac- tured abroad when they get an oversupply ? — A. It is possible. By Commissioner Kenner : Q. What is the amount of capital invested in the manufacture of quinine in the United States, in round figures ? — A. It would be very difficult to answer that question, for this reason: About all the manu- facturers of quinine in the United States are largely engaged in the manufacture of other materials as well ; they manufacture perhaps three hundred other preparations. For the production of 200,000 ounces of quinine (our present stock) our present investment, including the bark we have on hand, is probably worth $150,000. I would like to make one statement in regard to the low prices of bark we have here. Three years ago there was a discovery made in South America of a new district from which a large supply of the cinchona has been obtained. If that new supply had not been discovered, I think that the price of quinine this year would have been between $4 and $5 an ounce. The supply of bark was becoming very low, and, as I say, several large forests were discovered, from which there will probably be obtained at least one hundred thousand bales of bark, which is of a richer variety than the average bark we have known for years. Of course this has had the effect of reducing the price of the bark, because it threw such a large quantity of it upon the market, and 1 think the low price of quinine at present is due more to that fact than to any other. By Commissioner Ambler : Q. Are you able to give us, in a general way, the difference in the cost of the bark in the year 1879 and the present time; that is, the price of it per bale, tor instance? — A. In 1879, the price of the bark varied so much, and the character of the bark was so different, that I could not say, off-hand, what the average price was, but I will take pleasure in sending a written statement which will give you that infor- mation. By Commissioner Kenner: Q. What number of operatives do you suppose are engaged in the manufacture ol quinine in the United States ? — A. Boughly estimated, I should say perhaps 500 persons. Q. What is the largest quantity of quinine ever manufactured in the United States? — A. The largest quantity manufactured in the United States was probably something over a million ounces. That was imme- diately preceding the reduction of the duty. The world’s consumption of quinine has increased very rapidly within the lust live years, and in the United States its consumption has probably increased at least one- third within the last two years. Q. If you could manufacture two hundred thousand ounces of qui- nine upon an investment of $150,000, would it be fair to say that to manufacture a million ounces, the figures would be in about the same proportion? — A. Yes, sir; I think that would be a fair estimate. Beference has been made to the existing condition of aff airs in Europe 248 TAEIFF COMMISSION. [C. A. ROBBIA'S. as regards qninine. There is a very complex state of affairs existing there now. This Cnprea district that has been spoken of is now prac- tically exhausted, and one large firm in London (who were consignees), knowing that this was going to occur, being under large advances for bark, formed a bark syndicate, whereby they have entire control at present of 40,000 bales of this rich Cuprea bark. This forms a large percentage of all the bark existing in the world. There is also what is called a quinine syndicate, but which is really a syndicate of one man controlling different factories. It is for his interest to get all that bark into his own hands. Therefore he says to the owners of the bark : 44 You shall not sell that bark to am body else but to me. If you offer that bark to anybody else, I shall put my prices down.” Within three weeks there came a spurt on some demand from the West, and the price stiff- ened. This gentleman cabled over to his agent here : 44 Supply freely at 2J cents below the market price.” And that is the way he is keep- ing the price down, so that they shall not unload until they unload to bim. Five weeks ago when I was in London, the very appearance of this man on the streets led some people to the conclusion that perhaps the bark and qninine syndicate would come together, and that was suf- ficient to put up the price of quinine one shilling an ounce. Yon can see, therefore, the position that we who are on the outside of this thing are in. By Commissioner Underwood: Q. I would like to ask you whether, notwithstanding these disad- vantages of which you have spoken — this European combination or syndicate, &c. — the price of quinine has not continually declined? — A. Yes, sir ; it has declined ; but about the time the duty on quinine was taken off, this district, of which I have spoken, producing 100,000 bales and over of the richest kind of bark in the market, was discovered. Had that discovery not occurred there is no doubt that quinine would have been very high. We are shorter now of other grades of bark, ex- cept this, than ever before. This was a most unusual thing, and nobody expected such a discovery would be made. My advices are that large sections of the country in South America have been explored to see if there are similar forests, but it is believed that none exist. It is claimed that the tree which produces this quality of bark, is not, strictly speak- ing, the cinchona tree. This accounts for the present low price of quinine. By Commissioner Kenner : Q. It was stated by one of the gentlemen who appeared before us that there has been a large number of trees planted in the island of Jamaica. Was there any bounty given to the people of Jamaica in order to induce them to plant these trees, or was there any preference given to them to induce them to sell the bark to English rather than to American consumers ? — A. The trees were planted by the government at its own expense, and the plantations are being maintained by the government. The bark has to be sent to London, necessarily, to be sold. Wheu I was in Jamaica I tried to make some arrangements to secure a portion of the crop for this country, but I found that it was impossible to do so. I desire also to state that the quinine that sells for 82, is generally in ounce bottles. It costs 8 cents to put it iu the bottles, which makes it $1.92 net. In the present condition of the market, barks cannot be bought in any quantity, except a very few odd lots of bales, possibly, to produce quinine at that price. Bark could be bought four weeks ago QUININE. C. A. ROBBIA'S.] 249 which would make the cost in the neighborhood of $1.81 to manufacture quinine, which we are now selling at $1.92. By Commissioner McMahon : Q. What is the average cost per grain ? — A. It runs from 1 to 2 cents. The general price is 1 J to 2 cents a grain for it. That gives the retailer between $8 and $9 an ounce for quinine which costs $2. By Commissioner Ambler : Q. Are you, then, making it substantially at a loss, at this time? — A. We are not buying bark now. If I were to buy the bark to-day, I should make it at a loss. Q. Why do you continue to make it at a loss ; is it to enable you to carry out your arrangements with your customers? — A. We are manufactur- ing now from the stock of bark that we have had on hand for some time. I went down to South America myself and bought 300,000 pounds of bark, took the risk of shipping it, paid all the expenses of shipment, and at present am using largely that baik. But at present it cannot be bought and manufactured except at a loss. Next week it may change. The present price of bark in New York is caused by this sudden dis- covery of which I spoke. Q. Taking the business for the last year or two, have you been making it at a profit ? — A. Yes, sir; I have been making it at a profit, for the reasons stated. I cannot say what the other manufacturers are doing. Some say that they are not manufacturing it at a profit. The barks come now only from South America and from the East Indies and Jamaica. 250 TARIFF COMMISSION. [S. G. kosengauten. S. G. ROSEYGARTEX. Long Branch, Y. J., July 27, 1882. Mr. S. G. Rosexgarten, of Philadelphia, representing the manufact- urers of quinine, appeared before the Commission and made the follow- ing statement: I do not know that I can say anything in addition to what has been said by the gentlemen who have preceded me. I agree with all that has been said here to day upon the subject, and would be glad to respond to any questions which the Commission may see fit to put to me. There is only one thing in which I differ from Mr. Bobbins, and that is in re- gard to the tariff not making the article any higher. As I understand it, the object of the tariff* is to make the article higher, otherwise there would be no advantage in having a tariff, which I can see. The same principle applies to everything. Our labor is higher, and we cannot possibly obtain labor at the same rate that they do abroad. When I first went into the business nearly the whole of the bark came to Yew York. The Calisaya bark generally came to the house of Alsop & Co., an American house, and Yew York was the headquarters of the bark trade. What we did not buy here was shipped to Europe. Since that time the whole business has been entirely changed. London is now the head- quarters, and the great center of the business, and dictates to the rest of the world ; the bark business is concentrated there. The principal part of the bark is now held by a bark syndicate, the quiuine is held and managed by the European manufacturers, and we are at a great disad- vantage. We coutinue the business because we have been in it for many years and have onr regular customers, and we purpose to carry it on to the extent that suits us. But that is not the true condition for a business of that kind to be in, especially in a great country like ours. In case of a war or a sudden demand we have no reserve upon which we can draw. We have no quinine ourselves in any large quantities, and Powers & Weightman have no large quantity on hand. I do not see how a 10 per cent, duty would be of much benefit to us, because that would not put us on a footing with the European producer. Ten per cent, would just about counterbalance our other disadvantages, and anything beyond that would place us, I suppose, where other industries are. Twenty per cent, seems to me a pretty moderate duty on the manufactured article. That the manufacture of quiuine is essential in this country, I think hardly anybody can deny. Why the duty was taken off it is difficult to see. It was probably done as a political measure, partly because the manu- facturers were the weakest and were attacked first, and were not prop- erly supported by other manufacturers who were not awake to the rea- sons and causes of such action, which was afterwards plainly stated by the free-traders. By Commissioner Oliver: Question. You say that in case of a war there would be no surplus stock on hand in this country from which we could draw our own supply. In 8. G. ROSEN G AIITEX . ] QUININE. 251 that case would not tlie great market for the supply be in London? — An- swer. Yes, sir. If the business was renewed and became profitable, we could carry large stocks of bark, and of quinine too. We have carried large stocks in the past, and the most of the money that has been made in the business has been made by the carrying of these large stocks, bought at prices which we supposed were moderate or low, and then by a change of circumstances and growing scarcity the price went up and we availed ourselves of it. Q. Have you any advantage at all to compensate you for the disad- vantages which have been named? — A. I am glad that you asked me that question, because I desire to state that I do not know of any ad- vantage that we have in this country in the business. Q. Is it not one great advantage that you have a large market which is contiguous? — A. That would be an advantage, of course, if we had a large trade in the article ; but it is not enough to enable us to compete with the foreign manufacturers on the present basis. These foreign pro- ducers have appointed an agent in New York within the last two months to represent them in this country. By Commissioner Kenner: Q. What precise meaning do you attach to the fact that you stated that the bark and quinine business on the other side was managed by a syndicate? Do you mean there is an understanding among the man- ufacturers there to get up what we call in this country a u ring,” so that they can control prices? — A. Yes, sir; and it is more than that; it is a direct combination. The Milan house is directed by a gentleman named Boehringer— a very bold and enterprising man — and he has made combinations with other houses in Europe, and they have bought Pel- letier’s establishment in Paris and converted the business into a stock company, so that the three largest factories in Europe act under one head — the house of Alexander Boehringer. Q. I understand 30U to say that a moderate tariff on quinine, not ex- ceeding 20 per cent., and certainly equal to 10 per cent., is necessary for the continued manufacture of the article in this country? — A. Yes, sir; as a business. We should keep on manufacturing it, of course, under any circumstances, in order to supply our customers; but to make a successful business we must have some protection. You can see from the figures which have been presented to you how the business has fal- len off. Q. What I am trying to elucidate is this, whether, without this duty, you would be disposed to quit the business, or might be compelled to quit it, being undersold by European manufactories which, I under- stand you to say, are being managed and controlled by one party. If 3 011 were compelled to quit the business, would that not be ( putting the American market entirely at the disposal of that European combina- tion f — A. Yes, sir. Q. And would they not then charge us for quinine just what price they thought proper ? — A. I think they would. There might be other things which would come into relation with the business that would prevent their charging too much. There are other European manufact- urers that are not in this syndicate. There is one house in London and another in Brunswick — a large house which does not act with this syn- dicate of united manufacturers. But they practically control and the3 r keep the price down now because it suits them, and when it suits them they will put it up. That is their business, to make money for their stock holders. This Milan house is a stock concern. They have great 252 TARIFF COMMISSION. [ S. G. ROSENGARTEN. advantages in Italy. In addition to liavmg cheap labor, they have a good domestic market and are protected. The Italian tariff is a protect- ive tariff. By Commissioner Oliver : Q. You claim, of course, that the article is a prime necessity for the people, and I suppose we all admit that. Now tell me, in case com- munication should be cut off between this country and Europe, how long it would be, under the present condition of affairs, before the prices would appreciate — how quickly would they appreciate '? — A. In our case we would not have enough to get along from day to day hardly ; certainly not enough to last two weeks. We buy bark as we want it; we cannot do otherwise. Q. How long would it be until you could get a supply of bark from South America in the event of such an interruption of communication between this country and Europe ? — A. We could get it to New Y r ork in two or three weeks from the northern parts of South America. We have in the past carried a supply that would last under the same cir- cumstances four months, but now it would not last more than four weeks at the utmost. I have no hesitation at all in saying that there is no profit in the business under the present existing conditions. One great feature which causes the price of quinine to be kept down is that the European establishments, especially the one at Milan, are selling at a low price for a double purpose. One of their purposes is to drive us out of the business if they can, and the other purpose is to put down the price of bark. They are acting as the bear element now. How long they will act in that way it is impossible to say. By Commissioner Ambler : Q. Does your statement embrace the facts as they have existed for a year or two past, or does it relate only to the present time ? — A. It re- lates to the past two years. Q. Then why do you continue the manufacture of quinine at a loss ? — A. We do not think it a sufficient reason to give up the business because it happens to be bad for a year or two. We are hoping that it will im- prove, and that we may get the duty reimposed on the imported pro- duct. The appointment of a tariff commission is one of the reasons that leads us to hope that the business will be better in the future. JAMES HENDRICK. J ANILINE DYES. 253 JAMES HENJDBICK. Long Branch, N. J., July 27, 1882. Mr. James Hendrick, president of the Albany Aniline and Chemical Works, Albany, N. Y., appeared before the Commission, upon its invita- tion, and made the following statement: The history of our business is simply this. In 1866 my attention was called to the manufacture of aniline dyes, and I considered it a legitimate manufacture in this country which ought to be developed. Some gentlemen associated themselves together and we purchased the establishment of T. and C. Holliday, the only establishment of that kind then in this country, and began the manufacture in Albany of this article, putting in at first about $25,000 and subsequently increasing the amount to $100,000. We lost that amount of money and $50,000 additional in the business. In 1872 I took personal charge of the manufacture, and, applying to it practical business principles, found it could be made a success in certain directions. I emasculated everything from the manu- facture except the article of u aniline red.” We continued the manufact- ure of aniline red for seven or eight years and made an article, ac- knowledged by all manufacturers in this country as well as those who know of it in Europe, to be equal to anything made abroad. The price of it at that time was $6.50 in gold. We are selling it now at $2.25, and are supplying the manufacturers of New England, and to-day they are giving us orders for more than we can make of it. As I presume you are all aware, all these aniline colors are made from an oil procured from coal tar — the benzole made from coal tar. We have been obliged to import that because of the difficulty of getting it in this country in large enough quantities to distill it. We have been importing all of this oil that we required, but now we are manufacturing it a little. I have in my pocket a sample of analine oil manufacturd from benzole, which is, in turn, manufactured from the residuum of petroleum. I have also a sample of cloth dyed with the various colors that we make ourselves. These dyes we make in our factory, but not in large quantities We are putting up machinery now which will enable us to manufacture on a larger scale. The Pacific Mills and other like manufactories in this country ex- press the strongest hope that we shall receive from you the en- couragement we are entitled to. In a letter addressed to me within a week by Mr. Saltonstall, the treasurer, he said there were some im- porters, or the agents of foreign color companies going through the mills in New England, expecting to get a petition signed in favor of the reduction of the duty on aniline colors, and he said they would have no sympathy from them and cautioned me against them. I have no doubt you will have an application to this effect. I have not come here to tell you what you shall do. I can only point you to the evidence we have of what we have done in our little way toward reducing the price from $6.50 to $2.25, and we purpose continuing that warfare. W r e have not made a large amount of money, and every dollar we have made, we have spent in improving the manufacture of these colors, so that the TARIFF COMMISSION. [JAMES HENDRICK. 254 investments we have made from the year 1SG6 up to the present time, have not yielded us 1J per cent, on our money. But we are developing the business we have helped to create and the country is getting a benefit. I will leave you samples of these colors I have referred to. By Commissioner Ambler : Question. As I understand the matter, this is the product you obtain from the residuum of petroleum, and you are still continuing your experi- ments endeavoring to extend the number of colors to be made? — Answer. Yes, sir. Q. I do not understand that you now make a multitude of colors, so as to be able to put them on the market? — A. Not all of them. We are manufacturing the colors I have exhibited. Q. From these experiments which you have made you think you can make a variety of colors, and are putting in the machinery now for that purpose? — A. Yes, sir. Q. It has been suggested here that the raw material for making these colors is not obtainable in the United States. Is that the fact, and, if so, what is the cause of it?— A. It is a fact, for this reason : That, as I en- deavored to explain, the gas-tar was not gathered in sufficient quantities in this country to make the benzole, and the expense of distilling benzole into aniline oil has been too large for any party to engage in it. But there are two parties now making benzole, the Yew York Coal Tar Com- pany and one other, and they are’exporting benzole, and we are import- ing the oil. If we get the oil industry started, as we expect to do, we shall not be dependent on foreigners for our oil, but they will be depend- ent on us. Q. Have you taken any steps towards producing this aniline oil ? — A. Yes, sir ; contracts are out for $35,000 worth of apparatus with which to manufacture it, and I have a chemist here from France to superintend the work. Q. How long have you been making these other colors ; I do not mean the aniline red ? — A. Not more than about two years. Q. Are there any other firms in the United States engaged in. the manufacture of these aniline colors? — A. There are three or four, I think. There is the firm of T. & C. Holliday, in Williamsburg, N. Y., another one in West Virginia, and one in Buffalo, N. Y. Tiiose are the only three I know of; I have heard of others. Q. Up to this time, as I understand you, this has been an unprofitable experiment? — A. I cannot say that; but we have been spending a large amount of money. Q. Have you been able to make aniline red at a profit? — A. Yes, sir; we have been making it at a profit, but all the profit we have reinvested. We have upwards of $250,000 invested in the business in buildings and machinery, and this will be the result of the profits for the last ten or twelve years. By Commissioner Kenner : Q. Are these colors fast colors? — A. They are as fast as colors can be made. All aniline colors are a little fugitive ; that is to say, the sun will fade them somewhat. All the red garments you wear are made from them, every one of them. We have everything in this country that is necessary to manufacture aniline dyes. We have brains enough to do t ; and I think we are as able to make them as any foreigner is. By Commissioner Ambler : Q. I am requested to inquire of you (and your answer can be given JAMES HENDRICK.] ANILINE DYES. 255 now, or hereafter, in writing) what you would regard as a sufficient duty for the protection of your manufacture ? — A. My individual opinion would perhaps be of no more value than the opinion of any other person. We do not want to make a great fortune by large protection. 1 think, perhaps, that a fixed duty of $1 per pound would be preferable to the duty of 50 cents per pound and 35 per cent, ad valorem. Q. Would not that operate very unequally in this respect, that some of these colors are very much more expensive to produce than others ? — A. Yes, sir. Q. Have you any remedy to propose as to that; that is, can you sug- gest any mode of making the rates equal ? — A. No, sir ; if I were to suggest a plan I should say let well enough alone ; let the business go along until it is better developed, and it will regulate itself by and by. I believe the great curse of the country to-day is change in these laws; and I think the less we change the tariff, as it affects commercial and manufacturing interests, the better. It is a trite saying, attributed to President Lincoln, that you should never swap your horses when cross- ing a stream. I think that principle should apply in this case, and that when we are trying to develop a business it is n<^ well to change the laws affecting it too often. Q. It is complained that this is an unequal duty. The only purpose I had in asking the question was to ascertain whether you had anything to suggest which would make it an equal duty; and I now ask you spe- cifically, would an ad valorem duty, at a proper percentage, be a fair duty ? — A. It would if you could get at the ad valorem ; that is the great difficulty. The manufacturers on the other side of the water are exceedingly smart, and they will tamper with colors, and represent one color to be a different color; and the difficulty is in getting competent men w r ho know the value of an article, and will place the true ad valorem on it. I have heard of expensive colors being introduced under a new name in order to get rid of the duty. Therefore, I say the other way is the more equitable method. By Commissioner Garland: Q. 1 understood you to say, in regard to the supply of the raw material, that you were importing it from abroad? — A. We have imported all the raw material of which we make these colors, and are doing so to- day. Q. Is there not enough material in this country, if it was collected properly, to furnish the supply, or what is the difficulty? — A. The diffi- culty bas been that it was not profitable to go into that branch of the business. The tar yields f to 1 per cent, of benzole, both the American and the English tar. Q. Is the English tar better adapted to the purpose? — A. It is one- eighth of 1 per cent, richer, that is all. But we think the American tar would be quite as good, the only difficulty is in getting it together and carrying it from one place to another, which would add the cost of trans- portation. Q. Then I understand there is enough of that material in this country, but the difficulty is in getting it together? — A. Yes, sir. Even if this product of petroleum fails, which I think it will not do, there would be an abundance for our own use and that of Europe besides; I mean of the benzole extracted from tar. By Commissioner McMahon: Q. If it should be decided to apply an exclusively ad valorem duty, what rate would you recommend? — A. I think about 35 per cent, would 256 TARIFF COMMISSION. [JAMES HENDRICK. be fair; that is my impression about it. I should make as few changes as I could. By Commissioner Underwood: Q. Would it be possible for you to furnish the Commission with a schedule of duties on these different articles which would enable the government to collect duties without ambiguity and the commission of fraud ? — A. Not unless you can make men perfectly honest. If we had honest men everywhere, there would be no trouble. There would be no difficulty in enforcing such a schedule in case men did not resort to dishonest practices. In that case I think 35 per cent, would be about a fair rate. I think we could live if it were fixed at that figure. By Commissioner Boteler : Q. You think specific duties are better for the government and for the parties concerned ? — A. Yes, sir. Specific duties I believe in, be- cause they are easily collectible, and men have no disposition to be dis- honest; but with ad valorem duties the temptation to fraud is greater. That is my view of that matter. I will leave you these samples that I have referred tj in my statement, and, if you desire, I will give you any further information I possess, from our books or in any other way. ALEX. E. KURSHEEDT.] EMBROIDERIES. 257 ALEXANDER E. KURSHEEDT. Long Branch, N. J., July 27, 1882. Mr. Alexander E. Kursheedt, of New York, representing the manufacture of neck- wear, laces, embroideries, &c., appeared before the Commission and made the following statement : I desire to make a few personal explanations before proceeding with my statement, in order that the Commission may understand the nature of our business, which is a somewhat special one in this country, although there are many in our line of manufacture, it was stated in the morn- ing papers that we had requested a hearing in behalf of the silk associ- ation. The Silk Association of America is an organized body, and they expect to be heard themselves in due course of time. We expect that we shall harmonize with the views laid before yon by the silk associa- tion in reference to any proposed changes asked by the silk manufact- urers, although there will be, of course, many anomalies arising in regard to several features which will then be presented. I desire also to dis- tinguish in my remarks between the importers, who are the distributing houses as well, and those foreign houses who import, having a house in some city in Europe, and a commission agent representing them here. In speaking of the importers I do not wish to be understood as referring at all to the distributing houses in this country, because they are mer- chants and traders, and are forced to buy where they can buy the cheapest. They will buy foreign or domestic manufactures, and they will give their orders to foreign commission houses if we are unable to compete with them. I only refer, therefore, when I speak of importers, to those houses wtiich are doing business in that way, and desire to say that we are seriously injured by their method of doing business. Of course, in speaking of commission houses and the importers and dealers generally, I refer only to the dry goods and fancy goods trade, and those trades that distribute manufactures of woolen, silk, and cotton goods, and the like. I also wish to speak of raw materials. Articles which are regarded as raw materials by the spinners and weavers, ot course do not include what we consider as raw materials, because we use many articles which have passed through several processes before they reach us, and before they are of any use to us to make the goods which we produce as the finished article. By the President : Question. Is this a preliminary statement that you are going to make, or areyou ready to submit a full statement % — Answer. It is a preliminary statement. To illustrate this matter I will first speak in regard to em- broideries. The term embroidery implies that there must be a founda- tion fabric, and also a thread used by hand or by machine to do the embroidery work. If a fabric pays a duty of 100 per cent., and the embroidery thread pays a duty of 60 per cent., and owing to some am- biguity in the wording of the duty, the imported article is put at 35 per cent., we are entirely shut out from competition. This is an anomaly I wish to speak of hereafter. I desire to exhibit to you now a few sam- ples. Here is an article of ruches. By Commissioner Oliver: Q. Are you manufacturing these goods in this country ? — A. Yes, sir. H. Mis. 6 17 258 TARIFF COMMISSION. [ALEX. E. KURSHEEDT. Q. Where is your factory?— A. We have several factories in New York City. I represent not only our own concern, but other houses in this business as well. This is a material [exhibiting] used in the manu- facture of these ruches. It is of French manufacture, and is made in Lyons. It is all silk, and it comes in paying 60 per cent, ad valorem duty. It is an article which has never been made, and cannot be made, in this country. I have seen and conferred with the principal manu- facturers of silk goods in this country, and they do not intend or desire to make it. It is called crepe lisse. Crepe is one of the principal manu- factures of Lyons, and it is made to the extent of several hundred thou- sand pieces annually. We have to pay a 60 per cent, ad valorem duty upon it, and can only make these ruches for consumption within this country. We cannot do any business with Canada, Mexico, or any of the South American States. The European manufacturers at Notting- ham, in England, and Paris, in France, and other cities monopolize this business, notwithstanding that we have the best machinery in the world with which to manufacture these ruches, because of the fact that we have to pay 60 per cent, duty on the material. The result is that we are limited in selling ruches to our own territory. It is quite a large business in America, there being probably 100 manufacturers or more. Many of our leading dry-goods houses, such as Arnold, Constable & Co., have a manufactory of neck ruches. But, as I say, the distribu- tion is entirely within our own country; whereas, if crepe lisse could be put on the free list, we could make ruchings and other similar articles and export them to every civilized country. I also wish to state that we expect that the silk industry will unite with us in recommending the introduction of crepe lisse, free of duty, the article to be so defined that no other silk material as made, or con- templated to be made, can be included. The details on this point will be embodied in a report of the silk association, which will be presented to you. • By Commissioner McMahon : Question. I understand you to say that you import this article ; that you pay 60 per cent, duty upon it, and that you manufacture a certain completed, finished article out of that material ? — Answer. Yes, sir. Q. Also, that you wish to have a foreign trade in it ? — A. Yes, sir. Q. Why do you not avail yourselves of the benefit of the drawback ? What is to prevent your exporting and having a drawback on this material that you import ? — A. I think the law only provides for such articles as are made entirely of imported material. This article is not wholly manufactured of imported material, because we use American silk in the composition of it. We are also extensive manufacturers of this article [exhibiting], which is known in the trade as u tucking.” The Manchester people take a cloth, which pays 5J cents a square yard duty, or 5*cents unbleached, and make this article, and it is imported at about 35 per cent. duty. Of course, if we use the imported cloth, we have to pay a duty equal to about 100 per cent. Here is a sample of the cloth such as tucking is made out of, which costs in Manchester threepence farthing per yard. If that cloth is 45 inches wide, it costs threepence farthing, which is equal to about 6J cents of our money. The duty on it is 5 cents a square yard, and you have to add which makes the duty 6| cents or nearly 100 per cent. That enables the Manchester people to make thousands of pieces of their cloth with tucking and sell them to our market, and thereby interfere with the cotton interest here as well as our own busi- ness. I think that the duty on the finished article of tucking, instead ALEX. E. KURSHEEDT.] EMBROIDERIES. 259 of coming in as cotton goods not otherwise provided for, at a duty of 35 per cent., should be in the neighborhood of 100 per cent., or the duty on cotton goods should be greatly lessened. If the duties on cotton goods are to remain as they are, we contend that the duty on tuckings should be at least 100 per cent. In this connection I desire to offer the following suggestion: The rate of duty on any finished article imported for sale to the consumer, must not be lower than the rate of duty imposed on the several materials of which such goods are manufactured. I could illustrate this further by showing you samples of other goods that we have attempted to make in this country, and which we are fairly entitled to make for many reasons. I might speak of these now. 1 desire to say that the United States is the great market of the world lor white goods, embroideries and laces; and statistics can be gathered and brought before the Commission to confirm this statement. Switzerland is the ceuter of our white embroidery trade. About two thirds of the Hamburg embroideries made in Switzerland come to this country ; and in Nottingham and Calais, the two centers of the lace manufacture, were it not for the American trade they could do very little business whatever. In the last two months, when the trade in laces fell off, you can see by the Nottingham papers that there has been a perfect stagnation in their trade. This is accounted for very easily when we remember that the American women are tasty, neat, and cleanly, more so than those of any other country in the world, and there is also a gradual distribution of wealth here among the masses, and woman occupies a higher position under our civilization, which puts her above the women of any other country. As a consequence she is able to dress better and to use more material, particularly white material. I wish to say, too, that we have established a great many recognized in- dustries in this country, which are almost unknown in Europe. I have visited different manufacturing centres in Europe, and have often been asked the question, what we do in America with certain goods that are manufactured there especially for us. There are many kinds of goods that are now manufactured abroad that would never have been made there if we had not started the idea in this country, and yet we are crowded out from the manufacturing of them here because of these de- fects in our tariff* system. We are also manufacturers of silk laces to some extent, but we can- not manufacture them on the scale that we would like, because of the duty. Personally, we are satisfied with the duty of 00 per cent, as it is, but would deprecate any reduction. The amount of silk laces consumed is very small compared with cotton laces. The silk laces are matter.*? of fashion, but cotton laces which can be washed are perfectly staple ; and I believe there are some kinds now used that will be in vogue as long as women wear laces. These are samples of silk laces such as we manu- facture [exhibiting]. I have also here some samples of cotton laces which, are made by the same machinery that we use at Nottingham and Calais, but which we cannot manufacture profitably owing to the tariff*. A great business is done in what is known as Nottingham lace curtains. The principal yarn used in their manufacture is a two-ply, 30-cord yarn. It costs ten pence halfpenny in Manchester, which is equal to 21 cents of our money. To it, should be added 10 cents per pound and the 20 per cent, ad valorem duty. The yarns pay GG§ per cent. duty. This article [exhibiting] is a finished article which comes in at 35 per cent, duty. Of course you see how we are placed, and how unjust the dis- crimination is. The staple American cotton costs equally here and in Liverpool — say 12.] cents a pound. Taking the difference between this price and the price of the finished product, it allows only 8J cents for all 260 TARIFF COMMISSION. [ALEX. E. KUB8HEEDT. the labor. Now, in America the cost of the two-ply 30-cord yarn is about 30 cents. That allows 17 cents for the same process that costs there 8J cents, making the cost of labor in this countiy exactly double. I have been among the operatives and working classes in Manchester, and hav- ing seen the effect of the low wages there, I think that the present rate of wages in this country is perfectly fair, and that it would be a calamity to the whole country if the rate should be lowered. So we cannot advise in equity that the duty on yarns, such as they are spinning in this coun- try, should be lessened. But, on the other hand, we do not make any fine yarns in this country, such as are used in the manufacture of these specimens of tine cotton laces which I have here exhibited to the Commis sion, and of course, the duty on them varies from 55 to 75 per cent. We would recommend that all cotton yarns above “ 120” should be admitted free. In recommending that measure we prefer that the Commission should take the testimony of experts ; that is, of our manufacturers. But, so far as we have been able to ascertain ourselves (and we buy yarns both here and abroad and import them for this market), we have never found a concern that spun anything higher than “100,” and that number only to a limited extent. In regard to the importance of the lace manufacture as an industry, without going into any details about it. I must say it is an enormous industry in Europe, both in England and in France. In this country to-day there are only three establishments — two besides ourselves — mak- ing silk laces, and of course, as long as we are restricted to silk laces, we can only do a small business and are not able to develop it. We want to manufacture cotton laces, because then there is no end to the devel- opment of the business. To-day we are forced to import machines from England, where they are made on old patterns, and there is no stimulus to improving them. We ought to make our own machinery here, and we want the duty on machinery kept up so that we can make it in this country, and in that way improve upon the European machines, and make a better quality of goods, for we want to make a better quality, and can make a better quality than the European manufacturer now makes. The subject of embroidery is a pretty large one. Here is a sample of the embroidery made by the Kursheedt Manufacturing Company [ex- hibiting]. This is all silk; of course we cannot touch cotton. I have here also a piece of cotton embroidery. By the President : Question. Is that made by machinery ? — Answer. Yes, sir ; the same machinery, exactly, makes both of these articles. I have here also some embroidered flannel. We use American flannel because, owing to some difficulty in the tariff, notwithstanding the fact that we have protection, they import some article that comes in direct competition. How it is done, we do not know. We use the Ballard-Vale American flannel almost exclusively. I will only show you one or two more samples, and then will close. I have here some slipper patterns that came in under a duty of 35 per cent, notwithstanding they should come in at a duty of 00 per cent. IIow that matter is arranged I do not know. These are of our own manufacture. We commenced making silk-embroidered ties in this country, but the agents of importers saw them and sent our patterns to Europe, and had them imitated there, making them on very tine mulls, and brought them in at 35 per cent. duty. Mull is not made in this country, and the duty it pays is about 100 per cent. ALEXANDER O. JONES. j QUININE* 261 ALEXANDER H. JONES. Long Branch, N. J., July 27, 1882. Mr. Alexander H. Jones, of Philadelphia, Pa., appeared before the Commission and made the following statement : I desire to state that from conversation with members of the Ways and Means Committee and members of the Finance Committee of the Senate, in Washington, and from what I have seen in newspaper arti- cles, I think it is a general impression that the present low price of quinine is due to the removal of the duty upon that article. Almost every one immediately asks the question, What was the price of quinine at the time of the removal of the duty? The answer is, it was $3.40 an ounce. Then the question is asked, What is the price ot quinine now? The answer is $2 an ounce. That is a difference of $1.40 an ounce, and it is immediately assumed that it is the result of the abolition of the duty on quinine. Assuming there is a lowering of price by reason of the taking off of the duty, the removal of the duty itself by no means accounts for that great lowering of price. I have seen quinine selling at a net price of $1.18 an ounce when there was a duty both on the bark and on the quinine, and I have also seen quinine range from six shillings an ounce in London to fifteen or sixteen shillings an ounce when there was no question of duty. The cost of the bark has a great deal to do in regulating the price of quinine, just as the price of wool and cotton regulates the price of woolen and cotton goods. The figures can easily be ascertained. Everybody knows what the price of quinine is to-day, and you can ascertain what it was at the time of the removal of the. duty, it is not a question of argument ; it is a simple matter of fact. The price is lower to-day than it was then. But at the same time I claim that the price would be lower to-day than it was then, leaving the question of duty out of view, by reason of the reduced price of the barks; and Dr. Robbins has explained to you one reason why the price of the bark is lower to-day than it w as some years ago. The reason is the discovery of this large quantity of cinchona bark in the Cuprea district. 1 think it only right and proper that that fact should be taken into considera- tion. Fifty years ago quinine w as sold at $1.50, and I remember myself of quinine selling at $1.18 w hen there was a duty both on the bark and on quinine. Now in relation to the stock of bark and the stock of quinine in this country, in former years we would start out at the beginning of the y ear with a very large amount of quinine, and go on steadily working all through the early winter and spring months, keeping up a good supply with reference to the active demand that always comes on during the sum- mer and fall months. At present, instead of having a large quantity of quinine on hand, and a large amount of the bark every day while the active demand is coming in, we have to take up our letters and examine every one to see what quantity has been ordered, and then we examine and see how much quinine the party has had recently from us (for we cannot supply him with all he asks for), and some days we find we can only fill one fifth of each customer’s order; sometimes it is one-fourth and 262 TARIFF COMMISSION. [ALEXANDER H. JONES. sometimes one half, according to the amount we have on hand ready for shipping, and so we divide it up among our customers in that way. We are not able even to supply all of them with a portion of their orders, but are obliged to drop many of the orders because we cannot till them. This goes on day after day. Instead of having a large supply of qui- nine manufactured and a large supply of bark on hand, we are working from hand to mouth, so to speak, and every day we divide up among our customers what we have to send them. As fast as we make it we put it up for shipment, and it goes out and has to be apportioned among our customers in that way. By the President: Question. Under these circumstances, why is it that these orders are given you for your quinine; why do these parties not buy in the open market? — Answer. We have been in the business for many years, and have a large trade, and I think we have satisfied our customers in our business dealings and they continue to apply to us. Our firm used to handle a great deal of quinine, and the article of American quinine we supplied stood very high indeed. I may say that the American qui- nine always has a preference in this market over the foreign, and when the price is the same sells right along, and at present commands a pre- mium. Formerly we made contracts with our customers to supply them with what they wanted, and were always able to do it. We made our contracts in this way with large houses in the Wost, in the South, and elsewhere. There would be a large house in Saint Louis that might want from 10,000 to 20,000 ounces of quinine within three or four months. Suppose the price was $2 an ounce and they wanted 5,000 ounces a month. If we sent them the first installment the price would be $2 an ounce, and so if the price went up to $2.50 an ounce they got their next installment at $2; but if the price went down to $1.50 they got the benefit from the decline. We have been in business since 1821, and have tried to conduct our business in a fair and honorable way, charg- ing our customers only a fair profit, and of course they are attached to us and have a kindly feeling toward us, besides having the preference for American quinine. By Commissioner Oliver : Q. How did the price of quinine range during the twelve months succeeding the taking off of the duty? — A. Immediately after the tak- ing off of the duty the price went up 10 cents an ounce. It went up from $2.40 to $2.50, and then it worked down again. There is a point I should like to speak of in this connection, and that is, that we are all accustomed to talk about hundred weight and tons, and so on, so that when we speak of the duty on an article sold by the ounce it seems like a large matter, because it is sold by the ounce. But, as I said to you the other day, the average price of quinine, tak- ing the English quinine as the criterion, would be about eight shillings, or $2. Twenty per cent, on $2 is 40 cents; 10 per cent, is 20 cents. There are 437£ grains to an ounce, and the prescriptions run up to, per- haps, 10 grains, or something like that; that is what the consumer buys as a rule. A man might, of course, buy an ounce of quinine at a time the same as he might buy a hogshead of molasses to use, but the fact is he does not buy for consumption in any such quantities. He goes to the retail druggist and he buys a few grains at a time. Now, putting the worst possible construction upon it, that the manu- facturers avail themselves of this 10 or 20 per cent., here is a matter of ALEXANDER H. JONES.] QUININE. 263 20 or 40 cents on 437J grains, so that the consumer is not and cannot be appreciably benefited by the removal or the imposition of a duty on the article. Besides, the government is not benefited at all, while under the old duty it certainly derived more or less of a revenue; but now that the article is on the free-list, there is, of course, no revenue from it. The American manufacturers are producing much less quinine than they did prior to the removal of the duty, and that has tended largely to build up this extensive foreign manufactory in Milan, which is able to supply a very large proportion of the whole product of the world. I think a very important matter to take into consideration is the large quantity of quinine consumed in this country. We are one of the largest consumers of quinine in the world, and I think it is very im- portant that we should be able to produce the necessary supply for our own use, that we should be self-reliant and independent, and if there was a duty imposed upon quinine we would resume our former practice of keeping on hand large stocks of the bark and of the manufactured article, and it would last us for a considerable length of time, even if we were cut off from our foreign supply by a war, or any other cause. By Commissioner McMahon: Q. Do I understand you to say that the average wholesale market price of quinine in this country may be stated in general as $2 an ounce? — A. That is the fair average price; the manufacturers’ price. Q. What is the fair average cost to the manufacturer here of pro- ducing an ounce of quinine? — A. The manufacturers would have to tell you that; very likely Dr. Bobbins could tell you. I am simply giving you the commercial statistics. 1 can simply repeat what I said the other day, that the wholesale dealer sells it at a very small advance of 5 to 10 cents an ounce. 264 TARIFF COMMISSION. [THOMAS 8. HAKKISON. THOMAS. S. HARRISON. Long Branch, N. J., July 28, 1882. Mr. Thomas S. Harrison, of Philadelphia, President of the Manu- facturing Chemists’ Association and manufacturer of chemicals and white lead, appeared before the Commission, in response to its invitation, and made the following statement: I do not propose to occupy the attention of the Commission for any great length of time. You have already very kindly heard two or three members of my association: Mr. Bower, who is secretary of the association ; Mr. Alexander H. Jones, who is chairman of the tariff committee; and one of its members, Mr. Bour. I am here more particu- larly, as the official head of that association, to say to you that what those gentlemen have told you I can confirm, and also to state to you that as soon as it became known to our association that this Commission was to be organized we took immediate steps to put in shape such informa- tion concerning our particular business as might be valuable to you. By the President : Question. Will you please state what the general character of your association is? — Answer. Our association embraces within its member- ship the manufacturers of almost all kinds of chemicals ; chemicals used in textile fabrics; chemicals used for fertilizing purposes; chemicals used for the manufacturing of articles in the arts, such as colors, paints, &c. It embraces under the general title of chemicals, the whole field. We have a large and influential association, embracing in its member- ship almost all parts of the country, and representing, I suppose, in capital, some $30,000,000 or $40,000,000. This association appointed a committee which was representative in its character, not only so far as the country was concerned, but so far as the different shades of opin- ion on the subject ot protection and free trade were concerned. This committee is comjiosed of gentlemen from the cities of New York, Bos- ton, Baltimore, and the West, and they are now busily engaged in pre- paring a schedule, which they hope to make exhaustive, and will pre- sent such facts as we hope will be convincing to you. Therefore, 1 will not at present enter upon the general subject of the tariff on chemicals, but will leave the matter to be carefully prepared and presented to you by this committee at some subsequent date. I have been requested, however, to call your attention to one or two matters of interest in this connection, and one is in regard to the soda interest of the United States. You may, perhaps, be surprised to learn that that branch of business, in the United States, is reduced to almost nothing. It is true there is one large concern, the Pennsylvania Salt Company, that manufacture largely, but I do not think at any great profit ; but that is the only company or firm which may be called manu- facturers of soda in the United States to any extent, and their pros- perity, or whatever you may term it, is due in a measure to the fact that they possess in the raw material an article (kryolite) which is admitted free; they have a monopoly of it in the United States. The other manu- facturers are dependent on salt as a raw material, and while we do not THOMAS S. HARRISON.] CHEMICALS. 2 65 advocate the abolition of the duty on salt, still we think there might be some relief given to us, the manufacturers of soda products, the same as is given to curers of fish ; in other words, that we may have a rebate. This country imports soda products by the hundred thousand tons. The amount of soda used may be regarded almost as an index of the civiliza- tion of a country. It is consumed by the glass manufacturers, and in dozens of the most important trades they use it, and they are too influ- ential and important now to be asked to consent to be taxed largely by an increase of the duty. But if some relief could be afforded that would enable the manufacturers of soda in the United States to do something, and not make us utterly and entirely dependent, as we are now, on foreigners for our supply, it seems to me it would be an act of wisdom to give us that relief. I cannot see how such relief can be afforded in a better way than by giving us a rebate on salt for the amount that is consumed by our industries. The duty on salt now is, 60 to 70 per cent. The duty on soda-ash is aspecific duty. Its ad valo- rem duty is about 15 to 20 ])er cent. It takes two tons of salt to make one ton of soda-ash ; so that it is impossible to manufacture at the present rate of duty. The English take the salt to make sulphate of soda; we mix the salt with sulphuric acid, and the result is muriatic acid; so that it is used for an entirely different purpose. In England they use what here is pur waste. The manufacturers here,£tore the sul- phate of soda away in thousands of tons, while in England they use it to make soda to advantage. There is another matter toVhich I wish to call your attention, and that is the duty on white and pig lead. While we do not think the duties on pig lead are relatively too high, and do not ask a reduction of them, yet they are such that some of the articles manufactured from j)ig lead, owing to the instructions of the Treasury Department, are admitted at a less duty than is paid on the raw material. Take orange mineral that is a manufacture of white lead. Under the construction of the Treasury Department the duty on that is 25 per cent, ad valorem, while the duty on pig lead is 50 per cent. Consequently that industry is dead; there is nothing of it. As I have said, our association will present to the Commission a most carefully-digested schedule of duties, and we ask that you will receive it and give it the consideration which it deserves. The President. Will you please put in a specific form such recom- mendations as you have to make ? The Witness. We will do so. By Commissioner Ambler : Q. How does the Pennsylvania Company get the monopoly of the kryolite? — A. All the kryolite deposits belong to the Danish Govern- ment, and they have made a contract with the Pennsylvania Company for a period of years, and have taken in South America as well as this country in that arrangement. The President. I believe that article is found in Greenland. The Witness. Yes, sir. This company, through its foresight and energy, has built up an industry which is a great credit to the country, and I should be exceedingly sorry to say anything which would in any way detract from the credit they deserve in this respect. But I think the need of the United States in the possession of* the industry is as great or greater than that of any individual. While the Pennsylvania Company has this business, they make at the same time soda-ash and some of the higher products, on which there is a higher duty, which 266 TARIFF COMMISSION. [ THOMAS S. HARRISON. enables them to live. Let me mention another industry, and speak of its success due to protection. In 1855 a Scotch manufacturer sent a foreman to the United States to construct a factory for the production of acetate of lime, which is a very crude product, and is the result of the destructive distillation of wood. You take a cord of wood and put it into a cylinder, and close up both ends, except, in one end, have a small opening for a pipe connected with a worm in a condensing tub ; put a fire underneath, and as a result the fumes of gas are condensed into a liquid called pyroligneous acid. That acid is mixed with lime and dried into a condition to be shipped. A cord of wood produces 1G0 pounds of this material. Wood is worth $12 to $14 a cord in England, while in this country it is worth only from $1.50 to $6 or $7 a cord, depending upon the location. Foreign manufacturers understand that if they can make it in this country, where wood is so cheap, it will be a very great advantage to them. Until lately they possessed that industry almost exclusively, and my firm was a large consumer of that article. We bought, until very lately, all our product abroad. JSow just look at the condition of the industry to-day. Six years ago I do not believe there were produced in the United States 500 tons of the acetate of lime. This year there will be made over 7,500 tons, of which amount over 2,000 tons are shipped to the other side of the water. That industry now con- trols the foreigner, instead of the foreigner controlling it, and that re- sult is due to the steadfast holding up of the duty on the acetate of lime and the great natural advantage this country possesses in the manufacture of that article. I could mention another article where the duty by mistake was put at 20 cents a pound, when the article itself sold for 9 cents a pound. The law makers probably intended to make the duty 20 per cent., and not 20 cents a pound. The immediate effect of that was to put up the price of the article to 45 cents a pound, and several manufacturers started in this country to produce it, until finally, owing to competition, to-day it sells at a lower price than the English manufacturer is paying for it, if you take into consideration the duty which is paid by the American manufacturer on a part of the goods that go into this manu- facture. By Commissioner Oliver: Q. What is that article that you have just referred to ? — A. Pyro- lignate of lead. According to my experience, articles that are over- protected, when there is no necessity to protect them so far as the exist- ence of the manufacture is concerned, may be in the nature of a mo- nopoly for a time, until attention is called to the excessive profits that are made, and then competitors spring up, which brings the price down materially, and the result is simply to increase the manufacture, and in the end to materially decrease the price to the consumer. JOHN W. BRITTON.] CARRIAGES. 267 JOHN W. BRITTON. Long Branch, N. J., July 28, 1882. John W. Britton, representing tlie carriage- manufacturing interest, appeared before the Commission in response to its invitation, and made the following statement: I appear before the Commission to-day to represent simply my own business, and not that of any association or corporation, and 1 shall be happy to give such information as it may be in my power to afford to the Commission. 1 am the president of the National Carriage Builders’ Association, but I am not authorized to appear on their behalf before you. I think, perhaps, there may be members of that association who would not agree with me in all the views which I entertain ; so that I will simply give you my own views upon the matter, as an individual; and I shall endeavor to be brief. I sent to New York a day or two ago, after I was notified by your president to appear before you, for a list or schedule of the articles en- tering into the manufacture of carriages, and the duties they pay, in order that you might understand what I ask for, and the reasons there- for. I have received in reply a list of these articles, which 1 will read with your permission. Schedule of materials used in the construction of carriages, and the import duty thereon. Materials. Specific duty. Ad valorem. Total ad valorem. Lamp metal, mouldings, and articles of brass Per cent. 45 Per cent. 45 Steel springs, tires, pole fixtures ..... ...... 45 45 Varnish and japan 50 cents per gal . . . 25 45 Silks and satins - - 60 60 Laces, worsted 50 cents per lb 70 cents per sq. yd. 50 cents per lb 50 63 W ilton carpets 35 65 W oolen cloths 30 60 to 70 I assume that the commission will not recommend much of a reduc- tion on these articles, and therefore I would say that the carriage man- ufacturers only want to be placed on an equality with their brethren abroad, who have a protection of 45 per cent. We are shut out from foreign markets under fhe present condition of our business. Previous to the enactment of the Morrill tariff, which practically allows carriages to come in free of duty, we had a market for our goods in Cuba and South America; in fact, quite a large one; but to-day we have no de- mand irom those countries, as the French manufacturers can place their goods there for a little more than half of our prices. And, having lost the foreign market, we think that something should be done in order to enable us to supply our own home market. Commissioner McMahon. I think that you are mistaken if you state as a fact that carriages come in free under the present tariff. The Witness. In my establishment we receive and put together a great many foreign carriages. Some of them are n$w, and they are 268 TARIFF COMMISSION. [JOHN W. Bl’ITTOX. sent to our place by the custom-house authorities, and we put them to- gether, so that they may have an examination of them ; we take them out of the boxes and put them together, and the examiner comes to our place and examines them. Many o the carriages that we import are second-hand carriages that have been used within a year, and we are asked to place a value on them. I was a member of the committee who went to Washington to see the Secretary of the Treasury seven years ago on this very business. We found that many of our customers would buy carriages in London or Paris and use them a few times, and then bring them over to this country as personal effects ; and, as a result, there was very severe competition. I believe there was no law to gov- ern that matter, but it grew simply to be the custom. Commissioner McMahon. It was decided by the Secretary of the Treasury, on the 23d of September, 1868, and reaffirmed on the 19th of July, 1871, that carriages could come in free when in use as persoual effects. O 11 the 31st of August, 1872, a decision was made by the Treas- ury Department that such carriages must have been in use abroad for more than one year in order to come in free. Then, in 1876, on the opin- ion of the Attorney-General, they were declared not to be household ef- fects, and since that time they have paid a duty. I would like to ask you if the list to which you have referred was not made up a long time ago ? The Witness. I think it was made up a short time ago. I do not dispute the fact that carriages are brought in here now and pay a duty. Commissioner McMahon. But you stated that they were admitted free of duty just now. The Witness. Yes, when they have been used one year. Commissioner McMahon. That is not so, as a matter of fact. The Witness. Then I stand corrected. But I believe second hand carriages can come in here free of duty. Commissioner McMahon. Any second-hand article — carriages, or any- thing that has been in use — is supposed to be subject to a diminution in value, according to the amount of use; but anything that is dutiable and is valued at more than $100 requires to be invoiced. The Witness. I know there has been a commission appointed by the Treasury Department to fix the value of second-hand carriages where they have been in use only a short time. Of course, such carriages are worth more than $100. What we ask is that you shall give us 45 per cent, protection. By Commissioner Oliver : Question. Would you prefer that the duty on the foreign articles which you consume be reduced ? — Answer. No, sir; I do not ask for that. Q. You prefer, then, that the duty should be increased on the article of carriages ? — A. Yes, sir; that would be satisfactory. 1 desire to add that I was very much interested in the remarks of the gentleman who preceded me (Mr. Thomas S. Harrison), and especially in what he said in regard to the effect of protection. I 11 1858, 1859, and 1860 we im- ported steel tires from Sheffield and paid 16 cents a pound in gold. The price of gold made it so expensive that we had to abandon their use. The Morrill tariff invited the steel makers into competition, and when gold sold for _'80 we bought a better steel ti~e for 21 cents, and to-day, under protection, we can buy a steel tire for 7 cents a pound which we used to pay 16 cents a pound for in 1858. JOHN Sr OANE.] JUTE. 269 JOHN SLOANE. Long Branch, N. J., July 28, 1882. Mr. John Sloane, of the Dolphin Manufacturing Company, Paterson, N. J., appeared before the Commission, in response to its invitation, and. made the following statement: Gentlemen of the Commission: I have come before you, and am willing to answer any questions that you may desire to put to me, or I will make a statement on the subject of the jute manufacturing indus- try, if it is desired. I would suggest, however, that you may be able to elicit the information you want in a shorter way by asking me questions. By Commissioner Kenner: Question. You are familiar, we understand, with the culture and man- ufacture of jute? — Answer. I am somewhat familiar with its culture and manufacture. Q. How many jute manufacturing establishments are there in the United States? — A. Not more than about six or eight, and some of them are very small. Q. Where are they located? — A. One in Brooklyn, N. Y. ; one in New York City; one in Paterson, N. J.; and one or two in Pennsylvania. Q. What amount of capital is supposed to be invested in those facto- ries? — A. Probably in the neighborhood of two million dollars. Q. If raw jute could be furnished by domestic growers in the United States would not the demand for jute be unlimited, so to speak, for cot- ton bagging, &c.? — A. The demand now for jute goods is almost unlim- ited, and the whole question is who shall supply that demand; whether we shall make a portion of these goods or whether they shall all be im- ported. The present duty on the raw material is $15 a ton, which is on the finer grades 24 per cent., and on the commoner grades 35 per cent. Q. Where is the jute culture in the United States carried on most extensively? — A. There have thus far only been experiments made. 1 understand from a friend, who has a plantation in Mississippi, that he has this year planted some 12 or 15 acres as an experiment. Hereto- fore, for a year or two past, there have been only small patches of a quarter of an acre or so planted to see if it would grow. They have demonstrated the fact that the plant can grow, and grow well, and that the climate and soil of America are more favorable for its growth than the climate and soil of India. The whole question, however, arises after the plant is grown. So far there has been no mechanical device sug- gested to cheapen the process of getting the fiber. Jute is a cane, with w ood inside, and the fiber is the inside of the bark. The wdiole question is a question of labor to get that fiber separated and put in merchant- able condition. By hand labor they all confess in this country, wherever it has been tried, that it cannot be done. The lowest-priced labor in the South will not compete with the low-priced labor of India, where from 10 to 15 cents is a fair day ? s wages. Q. Do you know of any one who is experimenting and devoting at- tention to the preparation of machinery which would hackle it or sepa- rate the fiber? — A. I have heard of one or more machines that are either invented or in process of invention by which they hope to overcome that difficulty, and I sincerely hope they will be able to do it. Q. The only difficulty, then, is in preparing it for the manufacture after it is grown?— A. Wholly. 270 TARIFF COMMISSION. (JOHN SLOAJfE. Q. And it can be grown in large quantities and cheaply in this coun- try"? — A. Yes, sir; the cost of the growth or culture of the plant is very much less than that of cotton. This gentleman I spoke of, who lives at Brook Haven, Miss., seems to feel very sanguine of the ultimate success of the growth of the fiber in this country, and I understand that he has engaged some mechanic to test the practicability of a machine that is made, or making, to separate the fiber from the wood. Q. Do you know of any parties in Louisiana who are cultivating jute? — A. I do not know of any one there who is cultivating more than a small patch or so for experiment. We received from New Orleans two or three bales of jute this last winter from a Mr. Jumel, I think, and I presume he is either the cultivator or the agent of the cultivator; he sent it on here to show the quality to us, and we remitted to him the full amount of the value of the same fiber of India growth, and he re- marked that unless some mechanical contrivance was devised, that they could never, at the prices of labor paid, produce jute in ftiis country. Q. How did the sample of jute that he sent you compare with the India jute; favorably or not? — A. One bale was quite as good and fully up to the average quality of the best grade of India jute; the others were only medium. Q. Would a duty upon the raw material have a tendency to develop the culture of jute, or would it simply increase the price of bagging? — A. The duty we have now upon the raw materials I think essential to the possible cultivation of it in this country, lor the time being at least. If the duty is taken off jute entirely, I think no one would make any effort to grow it in this country. Q. The duty is now 29 per cent., I understand. — A. The duty is now $15 per ton, which makes it 29 per cent. To the manufacturer, how- ever, it is considerably more than that, because we pay duty on the waste, which is some 10 per cent, as well. Q. From your knowledge of the character of the jute that you re- ceive and the quality of it, would you advise that the duty remain as it is, or be increased or diminished ? — A. If it is a practical thing to develop the growth of jute in this country, we do not wish to be antag- onistic to that interest. If they succeed in raising the fiber in this country and preparing it for use by such mechanical contrivances as seem to be essential to that end, then we certainly do not wish to throw a straw in the way of that industry, because it will be very large. To give you an instance of the growth of the jute industry throughout the world, I will state that it is not more than sixty years since the first jute was imported into India, and I talked with a man some eight or ten years ago who worked some of the first jute that was ever brought there. Twelve years ago 1,000,000 to 1,200,000 bales was considered a good average crop ; now 2,000,000 to 2,200,000 bales is the crop of India. You can see by that how the industry has developed, and there is hardly a limit to it. Q. What proportion of those two million bales comes to the United States ? — A. About 50,000 bales. Q. Not more than 50,000 bales out of the 2,000,000? — A. No, sir. Q. And the other portion is manufactured in Scotland ? — A. Yes, in Scotland, and on the continent of Europe. Q. The portion that is brought to the United States is made into cot- ton bagging ? — A. No, sir; that is a different thing altogether : that is jute butts, which is a small piece cut irom the bottom of the cane that is much harder and higher colored than the cane. The jute then begins and goes to the top of the cane. The jute-butt question is another large JUTE. JOHN SLOANE.] 271 question. The most of that crop finds its way to this market; but of jute proper there is only about 50,000 bales used in this country. Q. What is the duty on jute butts ? — A. Six dollars a ton. Q. Would you advise any change in that rate of duty? — A. I have no special interest in that matter myself. Q. It is not a question of interest — neither have I ; but we are try- ing to get facts and knowledge on the subject, and as you have practical experience we ask you for your opinion whether the duty should be in- creased or decreased? — A. I can state the facts in regard to the matter which will enable you to decide that question. There is now a con- sumption of over 200,000 bales, of 400 pounds each, in this country, and fully one half of that is put into paper. The refuse, ora portion of this refuse fiber from flax, may possibly be utilized for paper-making. Were it not for that consideration I should recommend that the duty on jute should be taken off. At the same time we have to consider that the jute butt is an interest, and if jute was raised in this country, that is relatively important. Formerly, ten years ago, in Calcutta it was a pos- itive expense to the dealer in jute to get rid ot his butts, and he used to put them away and burn them. Whereas now they get 14 or 15 rupees per bale of 400 pounds. Q. That would increase the cost of bagging used for baling cotton? — A. No, it would not increase it. We have got to have so many yards for every bale of cotton. Q. If we admit jute butts free of duty would it increase or decrease the cost of bagging for baliug cotton? — A. I do not believe it would have any effect at all. The price of gunny bagging is regulated more by the question of supply and demand than cost. Q. If we increase that duty, and it increases the cultivation of jute in this country, could we do that without any increased expense to the cotton interest ? — A. It is very important that the cotton baggiug should be at a low figure, and to day, and for the last three or four years (I can speak within my own personal knowledge of that period) cotton bag- ging has never been so low in cost to the dealer as it has been since bagging has been made in this country. Some ten, fifteen, or twenty years ago this bagging was wholly imported from Calcutta, and then the price was nearly double what it has been since, or within six or seven years, so that the duty upon the butt does not seem to cost the planter or the baler of cotton in the South one penny. Competition in the manufacture of that article has reduced the price very much below what it was before ever a yard of any bagging was made in this coun- try. Q. Dave you seen the bagging made in the manufactory at New Or- leans? — A. I have never seen the manufactory of bagging, but I know there is such a mill there. There are several gunny-bag manufacturers in the South; one at Augusta and Columbus, Ga., one at Charleston, S. C., and one at Richmond, Va. By Commissioner McMahon : Q. I would like to ask one question on the subject of jute butts. The duty has been often changed. In 1861 they paid $5 a ton ; in 1862 they paid $6 a ton ; in 1870 it was enumerated again at $6 a ton; in 1872 it was made free; in 1874 the revised tariff' continued it free; in 1875 the duty of $6 a ton was put on again. Do you know the reason why Con- gress has backed and filled so much on that jute-butt question? — A. No, sir; I do not know. There were certain interests, I presume, which brought influences to bear where they would do the most good. 272 TARIFF COMMISSION. [ K. A. HARTSHORN. E. A. HARTSHORN. Long Branch, N. J., July 28, 1882. Mr. E. A. Hartshorn, of Troy, N. Y., representing the hemp inter- est, appeared before the Commission, upon its invitation, and made the following statement: Gentlemen of the Tariff Commission*: For seventy years flax has been produced in the State of New York, in considerable quanti- ties and of quality quite suitable for nearly all kinds of yarns, threads, and linens. In many sections of nearly all the Northern States flax has been grown and good fiber produced, and we appear before you to day to contradict the statement being publicly made that no flax is being raised in our country except for the seed. One member of our com- mittee, David Kirk, esq., who, on account of ill-health, is not with us to-day, has been a flax merchant in the city of Troy, N. Y., for the past forty-nine years, handling as much as 500 tons of domestic flax annually. The chairman of our committee, Hon. Hiram Sisson, of Eagle Bridge, N. Y., has handled 460,000 pounds of North River flax during the pres- ent season, which represents about half the crop of 1881 grown in the counties of Washington and Rensselaer, State of New York. As a far- mer’s boy, the speaker can assure the Commission that he has a very keen remembrance that flax was one of his father’s staple crops, for he assisted in preparing the soil, sowing the seed, “ pulling” the flax, “whipping” otf the seed, “ spreading ” the flax upon the green meadows, to be retted by the rains and dews, and drawing the flax away to the scutchiug-mill to be cleaned or dressed. I describe the process in detail to convince the Commission that the cultivation of flax involves more labor than any other crop, and, by reason of excessive labor-cost, the American farmer finds it unprofitable to grow flax unless protected by a duty upon imported flax grown where labor is much cheaper. In the East we secure both fiber and seed, but in doing so we may compro- mise the full possibilities of each, but in the West, where flax is grown for the seed, the 500,000 tons of fiber annually wasted could certainly be utilized for paper stock, gunny-cloth, twines, cordage, crash toweling, &c., if a sufficient duty would be placed on foreign stock and foreign goods competing therewith. We therefore earnestly recommend that the duty be increased upon flax not hackled, flax hackled, and flax-tow. Most excellent hemp is being grown in Kentucky and Missouri, and it would be a national ca- lamity to p t a stop to the cultivation of this important fiber; but unless protected by a duty upon foreign hemp, we are certain that, its cultiva- tion would soon cease, and hence we ask that the present duty be main- tained upon hemp and hemp tow. Jute can be grown in the Southern States to advantage, and with the perfection of machinery for cleaning the fiber after it is steeped or retted, the cultivation of jute will become a very large industry in the South. We confidently expect that American genius will soon produce a jute-cleaning machine which will do for jute what the “gin” has done for cotton, and we therefore ask that the present duty upon jute be maintained. E. A. HARTSHORN. J FLAX AND HEMP. 273 We regret to inform you that by reason of an insufficient duty upon flax, hemp, and jute, yarns, twines, threads, and cloths, and especially the finer sorts, the spinning and weaving thereof in our country has as yet hardly commenced. We are sending abroad fully $30,000,000 annually to pay for these goods and enrich foreign nations, which ought to swell the income of our agricultural community, our working classes, and our capitalists, in connection with the production and manufacture of these textiles. Large capitals have been sunk and utterly lost in praise- worthy attempts to weave linens in this country, not because of failure to produce the goods, but because when manufactured the goods could not be sold at cost and profit against goods made abroad by cheaper labor, and entered at a duty insufficient to compensate for the higher labor costs here. We most respectfully call your attention to the fact that all other fabrics, such as cottons, woolens, silks, &c., which have received due protection, and which thereby our people have been able to manufact- ure, have been steadily cheapened in price ; and even such coarser flax, hemp, and jute goods as we have been able to produce here under our present tariff have been greatly reduced in price, while the finer sorts, which we cannot make here on account of insufficient duty to protect our higher cost labor, are not materially cheaper (on a gold basis) than 10 or 15 years ago. We therefore desire the duty to be 50 per cent, ad valorem upon all manufactures of flax, hemp, and jute. We confidently believe that the country at large will scarcely feel the effect of such increase of duty, and we predict that, so soon as the manufacture of these goods shall be fairly established in our country, their cost to the people will be steadily cheapened, and reduced to a much lower price than at present. For seventy years flax-spinning has been carried on in the village of Schaghticoke. People are still living there who worked more than fifty years ago in the old Joy linen mill, occupying the site on which the present cable flax mill now stands. Previous to 1861 skilled hack- lers (men) received $1 per hundred for dressing flax; skilled spinners (women) worked for 50 cents per day, and children (boys and girls) were paid 50 cents per week, boarding themselves. Strong, unskilled men could be obtained at from 50 to 62£ cents per day. But even while pay- ing these low wages the Schaghticoke mill could not compete success- fully with Scotch manufacturers, and actually lost government con- tracts for navy sail-cloth (duck), which they had held many years, be- cause the compensation of the foreign operatives was less than that of Americans in the same line of labor. Flax could then be bought at eight to nine cents per pound, and unbleached shoe and harness threads sold at 50 cents per pound. Since 1861 the wages of hacklers have ad- vanced to about $2 x>er hundred, those of spinners to $1 per day, and those of children to $2.40 per week. Flax now costs 12 to 13 cents per pound. Brown shoe and harness threads, however, have fallen to 30 cents per pound. These facts show that twenty years of tariff protection have resulted in doubling the wages of operatives in the special branches of manufact- ure pursued in the mill at Schaghticoke, added 25 to 30 per cent, to the prices secured by farmers for flax, and cheapened the cost of goods to consumers fully 60 per cent. Suppose protection by tariff were ex- tended to attempts in the direction of producing fine domestic linens, what would be the effect 1 ? One of our correspondents would probably say the prices of such goods would instantly bound upward. The other might reply that the increase would be temporary, and followed by a H. Mis. 6 18 274 TARIFF COMMISSION. l«. A. HAUTSHORN. reduction to figures below those now obtaining, as soon as the new man- ufacture had secured a foothold. Doubtless it will be represented to your honorable Commission that our climate, soil, water (and possibly our intelligence), are unfavorable for the manufacture of linen cloths, but we can assure you that such is not true in fact, and we can fully assure you that labor cost alone pre- vents our people from supplying themselves with domestic flax and hemp, and the products therefrom, home spun, home woven, home bleached, and home dyed. We beg to remind the Commission that flax-growing, spinning, weav- ing, bleaching, &c., in the north of Ireland, from whence comes nearly all our fine linens, was developed under the fostering care of the gov- ernment. Numerous acts of Parliament were passed to encourage this industry. A duty was imposed upon foreign linens, a bounty was paid to the Irish manufacturer for all linen cloth produced, and an additional bounty for all that was exported, and a fine was imposed on all subjects wearing foreign fine linen goods in any part of a garment, and upon manufacturers of flax machinery selling the same for exportation. We have greater confidence in the future possibilities of the linen in- dustry in our country, and only ask for such duty as will enable us to manufacture flax, hemp, and jute goods, and pay for the labor thereon upon an American basis of at least double the wages paid by our com- petitors abroad, which we humbly trust your Commission will recom- mend, and Congress will promptly ratify, confirm, and enact. By Commissioner Kenner : Question. In what do you differ from Mr. Barbour, who has appeared before us in regard to the flax interest ? — Answer. He has stated to the Commission that the finer grade of linens cannot be made in this country for some time to come. Mr. Barbour. Whenever we can grow corn in Ireland, you can make fine linens here. Commissioner Kenner. You differ on the question of climate, then, is that it? The Witness. Yes, sir. My assurance is that the finest linen goods made in the wide world can be fabricated in our country. By Commissioner Oliver : Q. It having been asserted that on account of climatic conditions only the north of Ireland was peculiarly fitted for the manufacture of fine linens, I would like to inquire of you whether there are any large quanti- ties of lineus made in France of extra good quality? — A. Yes, sir. So far as my information extends, I can say to the Commission that when these fine linens began to be made in Ireland, the Irish spinners themselves did not think that they could bleach them and they were sent to Hol- land to be bleached. But later on they found that they could bleach them in Ireland as well as they could in Holland, and now, of course, they are bleached in Ireland, in the north of France, and in Holland. Commissioner Oliver. And in Italy, too, I believe. A. Yes, sir. I may say (and I believe my information is correct) that they are now grass-bleaching fine linens in Ireland in as few weeks as it formerly took months to bleach them in. That is to say, there were no chemicals applied originally, and the dews and the rains really did it all. But now it is largely done by the use of chemicals, without any injury to the fabric, and the goods are out perhaps three or four weeks, or five weeks, instead of as many months, as formerly, and that is my E. A. HARTSHORN.] FLAX AND HEMP. 275 reason for saying that I believe we can make and bleach them in this country. I could show samples of flax yarns spun by my factory and bleached quite white in one day, made very white in two days, and in four days I could show you a sample quite as white as you would de- sire, and yet the fiber is not injured particularly thereby, and you could not detect any trace of chemicals. The thread makers are making bleached goods — half bleached, not full white — all the time in this country, and therefore I believe we can make the fine white linens. By Commissioner McMahon : Q. I understand your committee to say that the silk interest has a pro- tection of 60 per centum, the cotton interest an average of about 65 per centum, while you ask for the manufacturers of flax, jute, and hemp further protection, and that jute is not produced in any considerable quantities in this country. I also understand it to be the admitted fact that raw silk is not produced in this country in any considerable quan- tity. Are not those conditions parallel so far as regards jute, and are not the conditions the same as between flax and hemp and cotton, in a degree, cotton, flax, and hemp being produced from the raw product? Taking this question as the hypothesis, what is the objection to putting flax, jute, and hemp on the free li^t as raw silk and raw cotton are now on the free list? — A. My answer is that it would spoil a magnificent possibility for the American people; that we do not now feel the duty of 15 dollars a ton upon the raw jute, and that we confidently believe that in the near future the culture of jute will be like the cotton culture, a great industry of our country, and that it will be as profi table in the southern tier of States as cotton is. Q. Then you would put a duty on raw cotton, of course ? — A. I would put a duty on raw cotton as it was once put upon it, if we did not grow it now, and if thereby we could make it a grand success in this country; and so, if we can produce the silk in this country, as we are finding out we can, I would put a sufficient duty on it to encourage its culture. By Commissioner Kenner: Q. Are you familiar with the culture of jute? — A. I have never been in India, where it is grown, but I have made it a matter of reading and study for many years, being interested in it. Q. Are you familiar with the culture, or have you seen hemp grow? — A. Yes, sir. Q. Have you ever seen jute grow ? — A. No, sir ; I have not. I could not speak with reference to the cultivation of jute as I could with refer- ence to the cultivation of flax or hemp, because I am perfectly familiar with the latter. Q. If we were to take the duty oft* hemp, would the effect be to drive the home culture out of the market, as some gentlemen assert ? — A. I do not believe the cultivation of hemp would go on for three years under those circumstances. I do not think there would be any hemp raised if you took the $25 a ton duty off of it. In fact, in Missouri it is now almost an extinct industry, and they used to raise thousands of tons of hemp there. Q. What do you predicate that opinion upon ? — A. From the fact that the farmer, paying his hands the wages that obtain in this country, could not get a new dollar for the old one invested. The cultivation of hemp in this country could not exist in competition with the hemp grown in Russia and sent here free of duty. Q. The same reasoning would lead to the same conclusion in regard 276 TARIFF COMMISSION. ftf. A. HARTSHORN. to jute? — A. Yes, sir; I tliink if you put jute on the free list, that the people who are working away with their brains and money on the ma- chinery to manufacture it, or making experiments in the South, would stop at once and say it was of no use, for we cannot compete with Indian labor at the rate of 10 or 15 cents a day. Commissioner Kenner. I do not like to proffer information, because we are seeking it, but I would state as a fact that in the State of Louis- iana I found a gentleman had grown jute to the extent of 25 or 30 acres, equal in appearance and as heavy in weight as any hemp ever grown in the United States. It is ascertained as a fact that the soil and the climate are particularly adapted to the culture of the jute we use. These facts I state unhesitatingly, for they are the actual truth . The Witness. As purchasing agent for our company I have received by mail on different occasions five or six samples of jute — small pieces — grown, some in Florida and in Louisiana, and in other sections of the South, and I can say that uniformly the fiber has pleased me immensely. It has been of a bluish color, and really has the solider qualities of flax or hemp and not the frailty of the Indian jute. The samples that have been shown me look better every way than the Indian jute. Commissioner Boteler. The only trouble is the expense of preparing it; there is no trouble in growing it. WILLIAM LYBLL.J SPINNING MACHINERY 277 WILLIAM LYELL. Long Branch, X. J., July 28, 1882. Mr. William Lyell, of the firm of James & William Lyell, of New York city, representing the manufacture of spinning machinery, ap- peared before the Commission in response to its invitation, and made the following statement: I will state to the Commission that our business is directly the manu- facturing of weaving machinery, but we are also interested in several enterprises looking to the production of jute and cotton fabrics. So far as the duty is concerned, I agree with Mr. Hinde in advocating free lute. We are tariff men all the way through, and our interests are that way. But we are consuming large quantities of jute, probably the most that is spun and woven in this country, and the facts are that on the raw material we are paying a duty of 25 to 30 per cent., while the pro- tection on manufactured articles is only 25 per cent. So that there is a discrimination against our industry here, and we are not only com- peting against the cheap labor of Europe, but the government duties are against us also. I think, if there is a possibility of raising jute in this country, in order to protect the farmer and the manufacturer, there should be a compen- sating tariff. Many persons who are trying to perfect machines for the preparation of jute have been to our manufactory, and have shown us the results of their experiments. Those who have tried to raise jute say that it will be absolutely necessary to have a machine invented for its preparation, in order to make its production profitable. But as yet there has been no device suggested that can prepare the jute after it is grown, to enable us to compete with the cheap hand labor of India. It may be possible to invent such a machine; and if it is possible, then no doubt the product will be raised largely in this country. But in the meantime you will kill the manufacture if you don’t have some protec- tion. I think if the duty on jute was about three-fourths of a cent a pound ou a specific tariff it would be well. Our firm has made, I believe, all the machinery that has been used in this country for the manufacture of this article. If Congress will fix the tariff at a proper rate, we will have many more mills in this country, giving employment to large numbers of people. There are large manufacturers of this article in Dundee, Scotland, and they have grown rich on the profits of the manufacture. Of course we have the cheap labor of Europe to compete with, as we do in all other manufactures; but I think with the proper tariff that we could even overcome that disadvantage. With regard to flax, I know very little about it, although we are, at present, furnishing the machinery for a mill in Wisconsin. I was there last month and found a manufacturer there who gathers his flax and scutches it, and is weaving it. It is a new industry, and I do not know whether it will be able to live or not under the present condition of things. But this manufacturer is going on in an enterprising way, and he assures me that any quantity of the flax can be raised there and gathered in cheaply. I f we had protection, it would improve the quality 278 TARIFF COMMISSION. [WILLIAM LYELL. of the flax, and the farmers would protect the straw as well as look after the seed only. Heretofore they have thrown the straw away as valueless. This same manufacturer showed me some hundreds of tons of it that he had already gathered and was putting through his process of manufacture. By Commissioner Kenner: Question. Has any machine beeu invented looking to the preparing of jute for manufacture, that is to say, separating the wood from the fiber ? — Answer. My brother, who is a practical man, and who has a general acquaintance with that matter, can perhaps inform you better than I can. o JOHN H1NDE.] FLAX. 279 s> JOHN ltiNDE. Long Branch, N. J., July 28, 1882. Mr. John Hinde, of New York City, representing the flax and twine interest, appeared before the Commission, in response to its invitation, and made the following statement: I do not know that I can make any statement to the Commission which would give any facts in addition to those which have been pre- sented by the gentlemen who have preceded me. I indorse the views contained in the statement presented to yon by Mr. Barbour, and the views which other gentlemen have expressed to you orally in regard to this matter. Our company has found great difficulty in regard to the matter of carpet yarns, of which we are large manufacturers. Schedule C, paragraph 50, says that hemp yarn shall pay a duty of 5 cents a pound ; and under that same section, paragraph 41, it says that linen yarns for carpets not exceeding No. 8 Lea, and valued at 24 cents or less per pound, shall pay 30 per centum ad valorem. The construction given by the department at Washington has been, that hemp yarns come under the designation of flax or linen yarns, and instead of paying 5 cents a pound duty, as it seems to us the law was originally intended to provide, it comes in at 30 per cent, ad valorem, paying only really a duty of about 2 cents a pound. It has been so deleterious to our inter- ests that about one-half of our employes are now idle, placing us in about the same relation as the manufacturers who had to abandon the business in consequence of the lowness of the tariff, and the high price of labor which they have to pay, in comparison with the price paid for European labor. We are paying at present in New York City from $6 to $8 a week for spinners, while abroad the Irish and Scotch spinners are paying only 6 to 8 shillings a week for precisely the same labor. So that we are paying as many dollars a week for wages as on the other side they are paying sterling shillings; and, unless we have a protective tariff, something akin to 50 per cent, in place of 35 or 40 in the present tariff, it is almost impossible to compete with foreign importations. It does not seem strange, with this large discrepancy in the price of labor, that the manufacturers who first started the Willim antic Linen Company, at Willimantic, Conn., who went in with new machinery and imported skilled labor to do the work, had to abandon the business. It is true they still retain the name of the Willimantic Linen Company. They make very good crash goods, but their machinery mostly was broken up and abandoned. The same was true with the Sprague Man- ufacturing Company. The present tariff was framed so that they should have their goods almost free of duty, and yet under those favorable conditions the mill was abandoned, and broken up and sold. Such was the case also with the United States Linen Company. But without such a protective tariff as we have advocated here of 50 per cent., I see no hope for the future for the linen industry in this country. Something has been said relative to jute, and I do not know but what my friend, Mr. Lyell, will advocate free jute. And really, looking at it, I do not see why jute should not come in free. There is none being 280 TARIFF COMMISSION. [JOHN HINDE. raised in this country; and yet there is a glorious possibility of it, as Mr. Hartshorn has said. The future may loom up so that the jute may be raised in Louisiana and Florida to a considerable extent, if only American ingenuity would invent a machine to break it up, scutch it, and dress it, the same as they do by manual" labor in India. But that is a long distance ahead, the sambas the line linen industry trade is, for this country. We cannot hope to manufacture fine linens for shirt- ings and collars in this country for many years to come. Yet there is a possibility that in Oregon, flax can be raised equal to the Irish flax; and in Minnesota some flax can be raised almost as good as the Dutch flax; so that in the distant future, linen may be produced here. To do it, however, we shall need protection. Without protection it is utterly impossible to produce these things, and to manufacture these various grades of goods. I do not know that I have any further remarks to make. By Commissioner Botel*er : Question. I understand that the experiments that have already been made in the South show that our lands are very well adapted for the production of j ute in fine quality and large quantities to the acre. W ould it be good policy to admit the article free of duty, and thus, in the infancy of that production, crush out all attempts to raise it hereafter 1 ? — Answer. That is a question which I am hardly prepared to answer. As I say, there is a possibility of its being successfully produced in this country, and I have seen some samples of jute raised in this country much superior to any jute I ever saw that came from India. Q. Do you not think that there is a probability (taking into considera- tion the ingenuity of our people, who have been equal to almost any emergency in devising machines for certain processes) that in the near future some machine maybe devised to prepare this product?— A. Yes, sir; and I think it would be unwise to leave out of view the possibility of the construction of machinery adapted for the cleaning of jute. 1 think it is quite possible that such machinery may be devised; there seems to be almost no limit to the possibilities of machinery. The-man who says the construction of a machine to prepare jute is an impossibility, is behind the age. It does not seem more impossible now to have a machine constructed for the preparation of jute than it did to have a machine constructed for the ginning of cotton before Whitney invented the cotton gin. I think we may calculate upon having a machine as certainly now as they could in the past time anticipate the invention of the cotton gin. Therefore, I say that I do not think it is unreason- able to expect that in the near future we may have such a machine. -HIRAM SISSON.] FLAX. 281 # HIRAM SISSON. Long Branch, N. J., July 28, 1882. Mr. Hiram Sisson, of Eagle Bridge, N. Y., representing the flax- growing industry, appeared before the Commission upon its invitation, and made the following statement : Mr. President and Gentlemen of the Commission: At a conven- tion held in Saratoga on the 19th of July, by the flax, hemp, and jute manufacturers and the flax-growers of the United States, we agreed upon a paper which I ask may be read to you. With your permission it will be read by Mr. Thomas Barbour. (See testimony of Thomas Barbour.) By Commissioner Kenner : Question. What is considered an average good crop of flax to the acre ! — Answer. In New York State 300 pounds to the acre is considered to be a good crop ; perhaps 250 pounds to the acre would be the aver- age. Q. What would that represent in a crude state; what percentage would you throw away ! — A. I think if the straw has been properly retted, it is calculated that a pound of flax can be obtained from every five or six pounds of straw. By Commissioner Boteler: Q. What amount of seed per acre is the usual yield! — A. Eight bushels per acre is considered a fair yield. By the President : Q. Can the seed and flax both be preserved! — A. Yes, sir; they can. By Commissioner Kenner: Q. Without injury to either! — A. Perhaps the fiber is not quite as good as it would be if it was harvested before the seed is matured. But then it is good, so that we consider them both worth saving. By the President : Q. What is the comparative quality of American flax ! — A. It is very good, iudeed. They raise some flax in Ireland that is superior to any that we have in this country. I sell a great deal of flax, and am ac- quainted with many buyers, and I know that they pay a pretty fair price for our flax; that is to say, compared with the cheaper grades of flax raised in Russia and other places. I will tell you what I know about flax in Illinois and Iowa. There they sow their flax for the seed wholly. All they do is to plow the ground, sow their seed and mow the flax with a machine, dry it and put it through a machine that is propelled by horse-power, to knock the seed off, leaving the straw on the field. That would cost to pull the flax and prepare it for market about nine dollars per acre, and then it would cost about five dollars per acre to put the flax (which would have to be done by the hand, separating it carefully) upon the grass and bleach it with the rains or dew. Then they gather it up and bind it in sheaves and take it to the mill. This latter process would cost about five dollars to the acre. It costs three 282 TARIFF COMMISSION. [HIRAM SISSON* dollars to the hundred pounds to scutch the flax. The people of the West cannot sell their flax at a high enough price, labor being so higlq to make it any object for them to cultivate it 5 the price they receive for the flax being: so low after it is scutched. By Commissioner Ambler: Q. You think the average yield, then, would be about 250 pounds to the acre? — A. Yes, sir; in New York State, where I live. I think there is more flax raised — that is, scutched — in New York than in any other State in the Union. Q. Is the yield per acre as great or less in the West than it is in New York State? — A. I think it is as great. Q. You have given, us in a general way, the cost of getting this flax ready for market. What is the product of 250 pounds per acre; that i& to say, what is it worth at the present price, or its market value in the State of New York ? — A. That would depend something upon the quality of it. The larger the growth of the flax the more it will bring per pound. Flax that would yield 250 pounds to the acre might be worth 10 or 11 cents a pound at this time. By Commissioner McMahon: Q. I understand that a very large proportion of the flax fiber is burnt or used for other purposes than for manufacturing? — A. Yes, sir; in the Western States, but not in New York State. Q. How much capital, in round numbers, is invested in the manufact- uring of flax, jute, and hemp fiber to be used in textile fabrics in thi& country? — A. I am not prepared to state. Q. Is there a very considerable amount of capital invested? — A. They are raising a great deal of flax in the West at present, but that is for the seed only. Q. I am not talking about that; but I understand from the paper sub- mitted by your association that you recommend an additional duty on the raw material, rather in the hope of encouraging the growth of the- raw product in this country for the purpose of manufacturing hereafter than for the purpose of protecting an agricultural industry, if I may so call it, which has not attained any considerable magnitude. — A. We are in hopes, if we could get more protection, that this business would in- crease and enlarge. Q. But is it very large now? — A. It is quite large in some sections of the country. Q. What would be the practical effect if Congress should put flax r jute, hemp, tow -flax, &c., on the free list and leave the rates of duty on the manufactured articles from these products about where they are? — A. I think it would drive the growing of flax out of the States; that we could not compete with foreign labor in raising it. Q. I understand that it is grown now principally for the seed, except in New York State? — A. They do that, but they cannot afford to raiso the flax and prepare it for market, because there is no money in it. Q. And it is not raised now* for market except in New York State ? — A. But a duty might help them to do that. Q. That is exactly what I wanted to get at. Now, can you tell me about how much capital is invested in New York State in the produc- tion of the fiber exclusive of the seed for oil? — A. 1 do not know that I could answer that except by saying that within the past year I have handled between four and five hundred thousand pounds of dressed flax. I have sold it to these manufacturers. HIBAM SISSON.] FLAX. 28 a Q. And that flax was produced in the State of New York ? — A. Yes* sir ; produced in the State of New York. Q. What is the value of that flax ? — A. Perhaps that amount would be worth $60,000. Q. And the capital invested in producing that amount of material is how much ? — A. I could not say. The farmer sows it, and then it goes to market, and he gets what he can out of it. Q. But are there not firms exclusively devoted to this industry ? — A. No, sir. By Commissioner Kenner : Q. Is there any mechanical process or invention by which flax is hackled and prepared for the manufacturer ? — A. Mr. Barbour and other members of the committee, I think, could answer that question. By the President : Q. Is there not some gentleman here to-day who is familiar with the subject of jute? — A. Yes, sir; Mr. John Sloan is, I think. By Commissioner Underwood : Q. W T hat kind of soil and climate is best suited for the raising of flax ? — A. I think a rich heavy loam is the best soil, and a cold moist season is very favorable to its development. Q. Are you acquainted with the Blue Ridge country of the United States ? — A. I am not. Q. If the Blue Ridge region abounds in very rich soil and the seasons there are moist, would that not be a suitable country for the raising of flax ? — A. I do not see why it should not be. Q. Humidity is one of the elements of its successful culture? — A. Yes, sir. By the President : Q. What is the advantage of growing flax in case of the failure of other crops 5 is there any advantage in growing flax on account of being able to grow it after another crop has failed ? — A. No, sir ; not in the same season. By Commissioner Garland : Q. The gentleman who preceded you [Mr. Thomas Barbour] men- tioned the fact that some 500,000 tons of this straw was burnt in the Western States. That I presume is burnt because the price does not justify them in sending it to market; is that the case? — A. Yes, sir; I suppose it is. Q. How much enhancement of the imce would be necessary to in- duce the farmers to bring it to market ? — A. That I cannot state. There may be other gentlemen before you who can give you that information. Q. As I understand, the reason it is not used by the manufacturers is, that they can buy the material in other quarters cheaper than they can get it of the farmers of the West. — A. Certainly. Q. Can you tell how much cheaper they can buy it in that way ? — A. I cannot say, because there are so many different grades of flax. I am not very well informed in regard to American flax. Q. How much duty are you asking to be put on imported flax ? — A. The duty is $20 a ton now. We only ask to increase it to $30 a ton. On what is called hackled flax it is now $40 a ton, and we want that increased to $50 a ton. This is a kind of a compromise between the man- ufacturers and the growers of flax. We have already agreed to this arrangement, so that it will give them a little protection and us a little^ 284 TARIFF COMMISSION. [HIRAM SISSON. Q. This increase of duty, $10 a ton, which yon ask, you assume would bring this flax that is now burned, to the manufacturers ? — A. It would be a help in that direction, although it would not be very much help. All the flax that comes in here from foreign countries would, under such an increase of duty, cost the manufacturers a half cent a pound more than it does now. Q. Would they continue to buy and use the foreign article, or would they buy their flax in this country? — A. I think if they were protected in their manufactures then they could afford to buy ours in this coun- try. Q. That is to say, $10 a ton additional duty would enable the manu- facturers to buy American flax to advantage? — A. It would help. We would like to have the duty more, but I don’t know that we can get that done. JAMES LYELL.] SPINNING MACHINERY. 285 JAMES LYELL. Long Branch, K. J., July 28, 1882. Mr. James Lyell, of the firm of James and William Lyell, repre- senting the manufacture of spinning machinery, appeared before the* Commission in response to its invitation, and made the following state- ment : The President. Before proceeding with your statement, I would like to inquire whether you are the inventor of the Lyell loom % — A. 1 am. By Commissioner Kenner : Question. We desire to know if there is any invention likely to be at- tended with success which can be used in the preparation of the raw jute, or jute in its natural condition, so as to separate the wood from the fiber satisfactorily, promptly, and cheaply, in order that it may be used in establishments engaged in the manufacture of this article. — Answer. I have had my attention drawn to that question several times by parties who have been working upon such machines, and have been and seen quite a number of experimental machines. But as yet no one has been able to invent a machine that does the work satisfactorily. There have been a great many machines gotten up for separating the fiber of the South American product, and they have been improving that machinery in the direction of fitting it for the preparation of jute; but they have not been successful as yet. But, as Mr. Hinde says, we do not know what the possibilities in this direction may be ; and, although we have not yet succeeded in perfecting such a machine, I do not know of any good reason why one should not be invented in the future. Most of the jute machines that have been experimented upon have been abandoned as useless. One gentleman I know has spent many thousand dollars on his experiments in this direction ; and it was because of his efforts that jute machinery was allowed to come in free years ago ; that is, on ac- count of the experiments he was then making to construct a machine to clean the jute and ramie with. He carried on his experiments for some time, and spent a great deal of his own and his friends’ money; but dur- ing the last few years he has gone into the chemical manufacturing business and has abandoned the other business. But I feel quite con- fident that if you can grow jute in America some machine will be in- vented to clean it. In the mean time the jute manufacturers are suff ering greatly because the tariff* duties are right dead against them to the figure of 3 to 5 per cent., beside the difference in the price of labor ; and, as a consequence, it has driven several of the jute mills out of existence in this country, and it will drive more of them out of the business if we do not have this tariff question fixed. While 1 would like to protect the farmer, and have him grow jute (because we would rather use American jute than Indian jute), yet at the same time we must be protected in some way or we shall go to the wall. My brother and myself weave more than half of all the jute that is used in this country ; but we have had a hard bat- tle to fight and are still fighting it ; and it yet remains an open question 286 TARIFF COMMISSION. [JAMES LYELL. as to who will go to the wall. We must have protection. Mr. Sloan has received two or three bales of a very good quality of jute from the South, he tells me. But, of course, if the producer has got to clean the jute by hand, he cannot compete with the cheap hand labor of India. In India the process is very simple. They throw the jute in a brook of water and let it soften there, and then strip the outside bark off. When the jute is ready to be baled in India it is not worth more than 2J cents a pound. We cannot do much in America for 2J cents a pound in the way of labor by hand. We must have a machine to do this work, if it is going to be done at all, because they can pick more cotton and make more wages at other industries than they can in this, while the figures remain as low as they are. The tariff is now, and has been for the last few years, on jute yarns, about 5 per cent, against us; that is, we have to pay more duty on the raw material than for the production of the yarns; and burlaps, which is the great article that jute enters into, get about 30 per cent, protection, while our jute is 1 or 2 per cent, against us on that, taking an average of the different grades of jute that we use. If the Commission can in some way arrange matters so that we can look to the future and have a chance to build up the indus- try, I think it would be very advisable. I was born in Scotland, but I am an American at heart, and I would like to see America go forward ; and if we can see a way whereby we can have the jute manufacturers protected, and at the same time look further into the future for the rais- ing of that jute in this country, it would be a very great advantage to all interests. We would like very much to be able to use American jute, and prefer it to that which we have now to import. THOMAS BARBOUR 1 FLAX. 287 THOMAS BARBOUR. Long Branch, Y. J., July 28, 1882. Mr. Thomas Barbour, of the Barbour Flax Spinning Company, of Paterson, jST. J., appeared before the Commission upon its invitation and made the following statement : Gentlemen of the Commission : At a meeting held in Saratoga, N. Y., on the 19th day of July, the flax, hemp, and jute manufacturers and the flax growers of the United States agreed upon a paper to be presented to your body, and with your permission I will read it. To the honorable the Tariff Commission : Gentlemen: The flax and hemp spinners and producers of the United States, as- sembled in convention at Saratoga, July 19, respectfully present the following facts and recommendations for your consideration. Several millions of dollars have been expended by more than fifty flax-spinning mills in an effort to manufacture linen goods in tbe United States, but although cap- ital was not lacking, The American Linen Company, Fall River, Mass., The •Willi- mantic Linen Company, The Uniled States Linen Company, The Sprague Linen Com- pany, and many others, had to abandon the business because the great disparity in cost of labor between European and American necessitated a protection larger than the tariff afforded, so that the present manufactures number about one dozen, and this industry, which England fostered by imposing a duty on foreign linens, paying a bounty on all linen cloth produced, and au additional bounty on all that was exported, may be designated as in its infancy, needing a protection such as was and is accorded to cotton, worsted, and silks. With a uniform duty of 50 per cent, ad valorem on flax, hemp, and jute manufact- ures, an immense impetus would be given to this industry, so that all the coarser fabrics as well as yarns and twines, would be made in this country, spinning the flax, which the farmer now burns to the extent of 500,000 tons annually, or allows to rot as valueless in the field. We recommend that the present duties on the raw and dressed flax and hemp be increased a little, as a protection to the agriculturist and flax-dresser, viz : tow, $15 per ton ; flax, $30, per ton ; hackled, $50 per ton. That Schedule C, paragraph 41, be so amended that where the words “linen yarns” occur, flax-tow yarns to be substituted, and that in place of 35 and 40 per cent, ad valorem, there be a duty of 50 per cent, on all yarns, threads, twines, and woven fabrics made from flax or flax tow, hemp, or jute, and that paragraphs 42 and 43 of Schedule C be also included in the 50 per cent, ad valorem duty. We also ask that Schedule L, class 3, paragraph 257, be so changed that it shall read hemp or jute carpeting, eight cents per square yard, and on all colored or partly colored, manufactured of jute, hemp or flax, or of which these compose the chief part, 8 cents per square yard, except that carpeting, by whatever name known, when made substantially in the same manner as Brussels carpeting, wrought by the Jacquard machine, or printed on the warp or otherwise, after the manner of tapestry carpeting, or tapestry velvet carpetings, or any other kinds of carpeting, shall, in each case, pay the same duty as the carpetings they are made to imitate ; that it shall not be lawful to allow any drawback of duty upon bags made of jute, flax, or hemp, or of which these compose the chief component part, except when exported in the original package. About $30,000,000 spun and woven fabrics, the manufactures of flax, jute, and hemp, are annually imported, and we confidently assert that a large proportion of the above staple goods could be made in this country, giving profitable employment to the skilled labor and also to the farmer, if the reasonable protection we ask for is given to the development of these important manufacturing industries which we rep- resent.* * We annex a memorandum of the present comparative duties: Per cent. Hemp and its products pay an average of about 25 Flax and its products pay an average of about 30 Silk and its products pay an average of about 60 Cotton and its products pay an average of about 65 Wool and its products pay an average of about 85 1 FL 288 TARIFF COMMISSION. [THOMAS BARBOUR. Jute, the raw material, is taxed an average duty of 29 per cent., and the manufact- ured goods a duty of 25 to 30 per cent., so that jute goods are comparatively without protection. HIRAM SISSON, Flax Grower, Eagle Bridge , N. Barbour Flax Spinning Company, Paterson, N. J., THOMAS BARBOUR, Vice-President and Treasurer, The A. H. Hart Company of New York, JOHN HINDE, President, E. A. HARTSHORN, President Cable Flax Mills, Flax and Hemp Spinners, Troy, N. ¥., DAVID KIRK, Flax Merchant, Troy, N. ¥., Per E. A. H., Dolphin Manufacturing Company of Paterson, N. J., JOHN SLOANE, Committee of Flax, Hemp Growers, and Manufacturers. We have made our communication as brief as it is possible to make it, and have, by giving the comparison between the woolen and cot- ton, the silk and other industries, shown that they are protected in the United States under the present tariff to almost double the extent of the protection given to the flax or to the jute interest. We have thought that figures and facts were the strongest arguments we could make before the Commission, and therefore we have presented the table which I have read. All the gentlemen who represent these industries are here, and are prepared to answer any questions you may put to them, or to make any statements you may desire. Commissioner Oliver. I think the gentlemen who have signed this paper which you have read should be commended for the good form in which they have put their statement. It is very concise, and differs in that respect from some other statements that have been made before us. By Commissioner Garland : Question. I would inquire what is the amount of capital invested in the jute and flax industry? — Answer. In round figures, I should say that there are $10,000,000 invested in that industry in the United States. We ourselves have over $1,000,000 invested in it in Paterson, N. J., where we pay a local tax of about $11,000 a year. These local' taxes really should be added in estimating the duty on this article. We have practically got 30 per cent, duty on flax goods, and we have to pay a duty on the raw material as well, so that that would reduce our protec- tion to about 25 per cent. Q. I understand that the interest you represent especially is that of the flax manufacturers ? — A. Yes, sir. Q. What duty do you ask to have imposed ? — A. We want a 50 per cent, duty, and we are willing to pay a slight additional duty on the raw material in order to encourage the growth of flax in America. Flax can be grown in New Jersey, New York, Ohio, Illinois, and in a great many of the Western States in large quantities. By Commissioner McMahon : Q. Is it, as a matter of fact, grown in any considerable quantity in this country ? — A. Yes, sir; it is grown very largely. Q. What proportion of the $10,000,000 invested in this industry in the United States is invested in the growing of the flax ? — A. I did not include that at all in my estimate of $10,000,000. The statement that there are 500,000 tons of fiber burnt iu Ohio, and in the vicinity of Ohio and in Illinois, is within the figures. I should have put it down at nearly double that. All that fiber could be utilized if we were protected in the coarser grades. The flax is raised from the seed, and the seed is '1H0MAS B1RBOUR.] FLAX. 289 converted into oil, and that is exported to England in the form of oil- cake, and they throw away the fiber. In Ireland, where I was born, we throw away the seed and save the fiber. By Commissioner Garland : Q. Where the flax is raised for the purpose of seed is the flax so good; is it not necessary to harvest it early? — A. It is not absolutely necessary. The fiber that is raised in America is a remarkably useful grade of flax; it would make good common towels. Q. What I want to know is whether this flax is valuable for both pur- poses, that is, for the seed and the fiber? — A. Yes, sir; it is. By Commissioner McMahon: Q. How is it in regard to jute; is that grown in any considerable quantity in this country? — A. There is an effort being made to grow jute in Louisiana, and Mr. Sloane will be better able to inform you on that, subject than I am. By Commissioner Oliver: Q. Are not certain conditions absolutely necessary in growing flax successfully; for instance, excessive moisture?— A. Yes, sir. In Ireland we grow better flax than you can in this country, but we do not use American flax for the same purpose that we do Irish flax. We make a great variety of grades and qualities. The American fiber is just as useful for the goods we make out of it as the Irish is for the goods we make out of that, and the price of the American flax does not commence where the imported article begins in cost. Q. About what is the average price of labor per day in your linen factory ? — A. The average per hand is about $5.50 a week. We employ girls from 12 years of age upward to 40 years, and some of them make as much as $10 a week. Children make $3 or $4 a week. A man can make $1.50 to $2 a day. Q. What would be the average price of this same kind of labor in Ireland or France? — A. We pay about twice as much in wages. W r e used to pay about two and a half times as much, but labor has gone up a little on the other side of the water owing to the large emigration to this country, and it has come down a little here. But it is more than double on the average. We have our pay-rolls for our manufactory in Ireland and our pay-rolls for our American manufactory for the same kind of labor side by side, and there is nobody better able to judge of that question than our firm. By the President : Q. Do you manufacture in both countries? — A. Yes, sir ; both in Ire- land and in this country. We have 2,800 hands employed in Ireland and about 1,200 employed in Paterson ; we have about 4,000 workers altogether. By Commissioner Kenner : Q. What does the flax grower consider a good yield per acre of flax? — A. The flax straw yields about 15 per cent, of fiber. Q. How many tons to the acre is considered a good yield ? — A. Mr. Sisson, our chairman, representing that matter, will give you the figures exactly. By the President : Q. I understand that you employ labor in this particular industry both in Ireland and in this country. Have you made any careful comparison II. Mis. (i 19 290 TARIFF COMMISSION. [THOMAS BARBOUR. of the rates of wages paid for labor in each country ! — A. Yes, sir; we have had our factories running here for 14 years. In Ireland we have had them running for a century, and we have carefully compared those matters, not only once but three or four times a year. Q. And then you speak from positive knowledge on that subject! — A. I speak knowingly in the statements I have made on that point. Q Please restate the difference in the rate of wages. — A. The wages we pay in Paterson are more than double what we pay in Belfast, Ire- land, for the same kind of labor. Commissioner Oliver. As you have such a good opportunity of get- ting at these facts correctly, will you please prepare a statement show- ing the difference in the rate of wages and submit it to the Commission at your earliest convenience ! The Witness. I will do so with pleasure. Commissioner Boteler. Will you please include, also, the compara- tive cost of living in each country! The Witness. I will. We have imported a great many workers into this country, but we find that, as a rule, they spend more money in America for rents and for food, they dress far better, and become more extravagant in this country, and do not lay up any more wages than they do in Ireland. But a great deal more money passes through their hands, and the reason they do not accumulate more is, because they live better and dress better than they do in the old country. Before closing my statement I would like to read a letter received from C. A. Ficke, of Davenport, Iowa, as follows: I have about 1,500 acres of flax in this State. Can you suggest to me any use I can make of the straw ? If so, you will greatly oblige, Yours truly. This is a sample of the letters we get every day or two from the West. By Commissioner Kenner: Q. What reply would you address to that inquiry! — A. That if it were scutched it would bring so much per pound. Q. How much! — A. Eleven cents a pound, or some kinds 12 cents a pound. But I would here remark that there are flax growers starting out in Illinois and flax mills in Ohio which were started this last year, and they are sowing a good deal of this coarse fiber. There are as many as three or four to my knowledge in as many different States in the West. By Commissioner Oliver : Q. In making your recommendation in regard to the duties to be im- posed, did you take into consideration the change of any of those duties from ad valorem to specific, or have you suggested whether it could be done or not! — A. Yes, sir; on linen goods we would prefer a specific duty. But there are so many different qualities that it is next to im- possible to have a specific duty applied so as to give a uniform protec- tion on all qualities. And therefore we are willing to make a recom- mendation of 50 per cent, protection duties, and to pay about 15 or 20 per cent, on the raw material. We do not want anything more than is very reasonable. We would prefer ad valorem duties from the fact that they are more simple. Q. In regard to linens, you think it would not be easy to make spe- cific duties which should apply to all cases! — I think not, because there are so many different qualities. Q. Of course you have looked over the present tariff* la w. Are there THOMAS BARBOUR.] FLAX. 291 any items in it in your line of business upon which you could recom- mend a reduction 5 are there any rates of duties which you consider excessive? — A. In regard to bleached or Irish linen, sh rting linen, there is no chance of those goods ever being made in this country at all. Q. Why? — A. Because we cannot bleach them, to start with. They require to be exposed for so many weeks in the atmosphere before you can get the white color, and we have not got the climate here to do that. It needs nice grass and no dust. By Commissioner McMahon : Q. What would be the effect if the raw products you have been talking about were put on the free list ? — A. There would not be a pound of flax raised in the United States for fiber, or a pound of hemp raised in Missouri or Kentucky at all ; it would wipe them out ; Bussian flax would wipe out the American flax. There might be some raised for seed. The farmers out West have always been looking forward to getting something for their fiber; and they have raised seed very often in hopes they would be able to sell their fiber also. Q. I understand they have not raised any fiber, except in New York State, to any considerable extent ? — A. They have raised flax in New Jersey and in Illinois. Q. But I am speaking of the fiber ? — A. No, sir ; but there is fiber raised in New Jersey. Q. In any considerable quantity? — A. Yes, sir. We buy all we can get hold of. Q. The rates of duty you suggest on the raw product are from 20 to 15 per cent. ? — A. Yes, sir ; that is b ased on our getting the 50 per cent, on our goods. Q. And you want fully that on manufactured articles ; what effect is that going to have on the price to the consumer ? — A. If there were mills in this country to make such goods as coarse flax would enter into, the competiton would very soon reduce the price, and the consumer would pay a very low price. Q. Below what it is now ? — A. I should say not much above it. But they would get, in the first place, a better article. There is an immense quantity of goods coming here now that are mixed with jute. They are finished off very high, but they don’t represent what we would call a fair and honest article of linen. There was a flax mill in Paterson fifty years ago, but it went out of existence afterwards. By Commissioner Garland: Q. I understand you to say that jute is mixed with flax in some articles? — A. We use a jute filling to the flax warp in the weaving. Q. Does that make an inferior article to the all-linen goods? — A. Yes, sir; jute has not the strength or durability of flax, although for bagging or burlaps it is as good. Q. Where do you get your jute from? — A. From India altogether, l believe. 292 TARIFF COMMISSION. [ C. N. BOVEE. JR. C. N. BOVEE, Jr. Long Branch, N. J., July 29, 1882. Mr. 0. N. Bovee, jr., of New York, in response to an invitation of the Commission, made the following statement in regard to the duty on foreign newspapers, magazines, and periodicals: The interest which we here represent is that of all the newsdealers of the United States and of the importers of foreign magaziues and periodicals. What we seek is the removal of the duty on unbound newspapers, unbound magazines, and unbound periodicals. It is these, not books, which we seek to have admitted free of all duty. Under the provisions of the Bevised Statutes we are compelled to pay a duty of 25 per cent, ad valorem, while, under the provisions of the postal union treaty, the game matter is admitted through the mails free of all duty. The postal treaty is a treaty between the United States, Great Britain, France, Germany, and other of the principal European nations, by which the transmission of mail matter is facilitated between the dif- ferent countries. Under this treaty all newspapers, magazines, and periodicals are transmitted from one country to the other free of any duty that may be imposed by the laws of the respective countries. Foreign newspaper dealers abroad have taken advantage of the treaty and have distributed through this country circulars setting forth this discrimination in their favor and against the interest of American dealers and offering inducements to secure subscriptions to them in preference to home dealers. They give notice that they can furnish to anybody in the United States foreign newspapers, magazines, and periodicals as soon as issued, free of the 25 per cent, duty whili they would have to pay if procured through American dealers, who have to bring the same matter through the custom-house and to pay this duty on it. The effect, of course, has been to transfer (and this transfer is constantly increasing) the bulk of this trade from American dealers to foreign dealers. In 1880 the mat- ter was presented to Congress. Petitions were sent in from all the principal cities of the United States, and were referred to the Commit- tee on Ways and Means. We appeared before that Committee and made our statement. The committee was unanimous in recommending that foreign newspapers, magazines, and periodicals be put on the free list. The bill failed on account of the non-action of Congress. This spring a bill for the same purpose was introduced in the House, read twice, and referred to the Committee on Ways and Means. We were assured that, if any action were taken by Congress on the tariff, this matter should be attended to ; but, owing to the appointment of this this Commission, nothing was done by Congress on the subject. WILLIAM H. ARNOUX-1 FOREIGN PUBLICATIONS. 293 WILLIAM H. ARNOUX. Long Branch, N. J., July 29, 1882. Mr. Wji. Henry Arnoux, of New York, in response to the invita- tion of the Commission, made the following statement in regard to the duty on foreign newspapers, magazines, and periodicals: We appear here in the rather paradoxical i>osition of asking you to remove the duty on periodicals for the purpose of increasing the revenues of the government. Some illustrations will help the Commission to know the effect of the present condition of things in respect to the reve- nue and postal service. I hold in my hand a copy of a London maga- zine — the Nineteenth Century. It is not republished in this country. The postage on this magazine sent from London to Chicago is 5 cents. Under the j)Ostal treaty, the country where the matter is mailed pockets all the postage. Consequently, the 5 cents postage paid at London by the Chicago subscriber goes to the British Government, and the Ameri- can Government carries the matter entirely free from the time it lands in New York until it is delivered to the subscriber in Chicago. On the other hand the American dealer who buys this magazine as an article of merchandise pays 25 per cent, duty on it. He has it delivered to him in the city of New York. From there he sends it through the mail, paying the postage upon it. The duty on this magazine is 7.02 cents, the freight from London to New York is 1.25 cents, and the freight from New York to Chicago is 1.25 cents. So that the duty and freight together cost the American dealer 10.12 cents, being a little more than double the expense to the party who subscribed for the magazine in London. That is a discrimination entirely hostile to the American dealer. I have here a copy of another periodical — the Saturday Review. The postage from London to a Chicago subscriber is 2 cents, but coming through an American dealer the cost would be : Duty, 2.25 cents ; freight from London to New York, 0.40 cent ; freight from New York to Chicago, 0.40 cent, making 3.05 cents as against 2 cents. In the one case there is a discrimination of 100 per cent, against the American dealer; in the other case, of 50 percent. The effect of this is that in 1879 there were sent by mail into the United States 1,204,500 pounds of foreign newspapers, magazines, and periodicals, an average of 330 bags weekly ; and in 1880 (the latest year of postal statistics) the quantity had increased to 1,947,400 pounds, a weekly average of 535 bags, an increase of 00 per cent, in one year. So much of that 1,947,400 pounds as was not distributed to New York went through the mails of the country, at an expense to the government and without the slightest compensation. *On the other hand, there came of the like matter, by freight, in 1881, 3,314 bales, weighing 040,100 pounds — less than one-third of the quantity that came by mail in 1880. It cost the government for carrying this mail matter $38,948, while the revenue received by the government from the matter brought into port as merchandise was $30,877. Another dis- advantage which the American dealer labors under is that he has to undergo the delay of getting this matter through the custom-house, while that sent by the foreign dealer is forwarded instantly. The for- 294 TAIRFF COMMISSION. [william h. arnoux. eign dealer knows the advantages which he thus has over the American dealer, and he sends out circulars making the fact known. I have here one of those circulars. It is as follows : ENGLISH BOOKS AT ENGLISH PRICES. Books by book post may now be 'mailed to the United States with safety, punctu- ality, and economy. The limit of size for a book-packet addressed from Great Britain to any place in the Universal Postal Union is 24 inches in length and 12 inches in width or depth ; the limitation of weight is 4 pounds ; the postage is one halfpenny for every two ounces if registered, the fee is two-pence. The inquiries of many correspondents are answered by some of the following official publications : [Treasury orders, 1879. Department No. 140.] IMPORTATIONS THROUGH THE MAIL. Treasury Department, Office of the Secretary, Washington, September' 13, 1879. To Collectors of Customs and others : The fourth paragraph of the instructions of the Postmaster- General, dated the 16th of May last, embodied in this department order of the 26tli of May, 1875 (Synopsis 4,027), relative to importations through the mails, reads as follows: “ Unsealed packages received iu the mails from foreign countries, which are found 6n examination by customs officers to contain articles liable to customs dut es, shall be delivered by the postmaster at the exchange office of receipt to the proper officer of the customs for the collection of the duties chargeable thereon, with notice of such delivery to the person addressed. It has been suggested by the Postmaster-General that the following instructions should be abided to the paragraph, viz : “But books received from countries or colonies of the Universal Postal Union, which are found to be dutiable, shall, when addressed to post-offices other than the exchange office of receipt, be promptly transmitted by mail to the addressees, charged with the amounts of customs duties levied thereon, respectively ; which amounts postmasters at the offices of destination will collect of the addressees on their delivery, and remit by first mail thereafter to the collector of customs of the district in which the ex- change post-office of receipt is situated ; and in case of the refusal or neglect of the addressees of such dutiable books to apply for them at the post-office of destination within a period of thirty days from the date of their receipt at said office, and pay the customs duties and any postage charges levied thereon, the postmaster of said office will specially return the same to the collector of customs of the aforementioned dis- trict. “Postmasters are instructed to collect the customs duties on such books forwarded to their offices for delivery to addressees, and promptly remit the sums so collected by them to collectors of the customs, in the manner prescribed by the Secretary of the Treasury ; but the postal revenues are not in any manner to be credited or charged with such duties.” The suggestion meets with the approval of this department, and the instructions contained in the amendment will be observed by officers of the customs. A record of the address and office of destination of each package, and of the amount of duties due thereon, will be kept, and on receipt of the duties, or return of the package, the fact will be recorded. A certificate in the form appended hereto, showing the amount of duties due, will be attached to each package lor the information of t he postmaster, who, in his letter forwarding the duties, should refer to such certificate by mentioning the number, date, amount, and the name of the party addressed, specified therein. Printed blanks will be furnished by the department. This order will take effect on the first proximo. JOHN SHERMAN, Secretary. Duties on Books Imported through the Mail. No. . [Place:] , [Date:] . Postmaster at : You are requested to collect and remit to the collector of customs at , the sum of dollars and cents (duties on the books inclosed in the package), in ac- cordance with the following instructions from the amended regulations of the Post- master-General, and this department, embodied in the Circulars of the Treasury De- partment, dated May 26 and September 13, 1H79. [Signature of the customs officer:] . WILLIAM H. ARNOUX.J FOREIGN PUBLICATIONS. 295 [Circular.] Post-Office Department, Office of the Postmaster-General, Washington, D. C., September 17, 1879. A regulation for tlie collection of customs duties having been agreed upon between the Postmaster-General and the Secretary of the Treasury, in pursuance of the pro- visions of section iv of the act making appropriations for the service of the Post- Office Department for the fiscal year ending June 30, 1880, and for other purposes, for delivery to addresses in the United States of books, subject to customs duly, which are admitted to the international mails, exchanged under the provisions of the Uni- versal Postal Union Convention, It is ordered , That the fourth paragraph of the regulation governing the treatment of dutiable articles received in the mails from foreign countries, adopted by the de- partment under date of 16th May, 1879, be amended by adding thereto the following words : “But books received from countries or colonies of the Universal Postal Union, which are found to be dutiable, shall, when addressed to post-offices other than exchange offices of receipt, be promptly transmitted by mail to the addresses, charged with the amounts of customs duties levied thereon, respectively; which amouuts postmasters at the offices of destination will collect of their addressees on their delivery, and re- mit by first mail thereafter to the collector of the customs of the district in which the post officer of receipt is situated; and in case of the refusal or neglect of addressees of such dutiable books to ajiply for them at the post-office of destination within a per- iod of thirty days from the date of their receipt at said office, and pay the customs duties and any postage charges levied thereon, the postmaster of said office will specially return the same to the collector of the customs of the aforementioned district. “Postmasters are instructed to collect the customs duties on such books, forwarded to their offices for delivery to addressees, and promptly remit the sums collected by them to collectors of the customs in the manner prescribed by the Secretary of the Treasury; but the postal revenues are not in any manner to be credited or charged with such duties.” This order will take effect on the 1st of October, 1879. D. M. KEY, Postmaster- General . [Revised Statutes of the United States, second edition, 1878.1 Sec. 2503. There shall be levied, collected, and paid upon all articles mentioned in the schedules contained in the next section, imported from foreign countries, the rates of duty which are by the schedules respectively prescribed. Sec. 2504. Schedule M. Books, periodicals, pamphlets, blank books, bound or un- bound, and all printed matter, engravings, bound or unbound, illustrated books and papers, and maps and charts, twenty-five per centum ad valorem. Sec. 2505. The importation of the following articles shall be exempt from duty : Books which shall have been printed and manufactured more than twenty years at the date of importation. Books, maps, and charts, specially imported, not more than two copies in any one invoice, in good faith for the use of any society incorporated or established for philo- sophical, literary, or religious purposes, or for the encouragement of the fine arts, or for the use, or by the order, of any college, academy, school, or seminary of learning in the United States. Books, professional, of persons arriving in the United States. Books, household effects, or libraries, or parts of libraries, in use of persons or fami- lies from foreign countries, if used abroad by them. not less than one year, and not in- tended for any other person or persons, not for sale. B. F. STEVENS, American Library and Literary Agent, 4 Trafalgar Square and Charing Cross, London, England. I suppose that this is the only instance on record where our govern- ment has placed itself in an attitude of discriminating against its own citizens and favoring foreigners under a treaty. It being a matter of treaty, it cannot be corrected by any action of Congress by modifying the postal law. That is beyond the power of Congress. The only way to remedy the evil is to place these articles on the free list. We want the Commission to understand that our request does not apply to books. That is a matter of more far-reaching and deeper interest to the com- 296 TARIFF COMMISSION. [WILLIAM H. ARNCVX. m unity, as to liow far American publishers may have the privilege of republishing valuable English books and distributing them throughout this country without competition from English publishers. These mag- azines and periodicals which we ask to have put on the free list are little pamphlets that are never (excepting very few) published in this country. There are a few English magazines, like Blackwood’s, republished here, but the English edition does not circulate here. There come only a few copies oliit for the public libraries and for the printers who republish it. What we ask for applies to matter in respect to which no interest of theUnited States requires any tariff protection. This matter has been so arranged by the Canadian Government that Ameri- can subscriptions for these foreign periodicals may be made in Montreal or any other Canadian city on the same terms as in England, so that American dealers have not only to meet the competition from Europe but also that from Canada. It is a very small matter to the Govern- ment of the United States, but it is a very large matter to the 9,000 periodical dealers who are interested. By Commissioner Porter : Q. Is it not also a fact that a great number of business circulars and advertisements are thus sent through the mails from foreign countries which would not go through the mails if issued by American adver- tisers ? — A. I have not examined that subject. Commissioner Porter. That is so in the case of many English in- dustrial magazines. Very many circulars are put into them which are really not mail matter. The Witness. That is an additional argument against the discrimi- nation which our government is now making against its own citizens. In Canada the duty on these foreign periodicals has been removed within the last three years. The same state of facts had existed there, and the Canadian Government applied the remedy which we now seek by the removal of the duty. By Commissioner McMahon : Q. There is a great mass of advertising matter published abroad in the form of pamphlets, many of which are issued periodically. It is to them that Mr. Porter referred. Would you make any exception as to them ? — A. That, of course, raises another question — whether these pamphlets ought to be required to pay duty. I would have to make some investigation in connection with the postal duty to see whether they come within the purview of the postal treaty. What we ask is a provision putting on the free list unbound newspapers, unbound maga- zines, and unbound periodicals. JOHN D. DIX.] ])RUGS. 297 JOHN D. DIX. Long Branch, N. J.. July 31, 1882. Mr. John D. Dix, of New York, representing the drug and chemical trade, appeared before the committee, and made the following state- ment: I do not come here with any personal axe to grind, but having had forced upon me in 1862 the preparation of a considerable share of the figures of the war tariff in reference to articles in my own trade, besides having had a long experience of 40 years in this business, I thought my views might possibly be of some value to the Commission. You have had here the chemical manufacturers day after day. The gentlemen who have appeared before you are of very high character, and I would take their word on any subject at any time, excepting where they are personally interested, and there, perhaps, their judgment might be warped. I want to say before I go any further, that I have merely taken up a few articles put down in 1862 in our list, to show you what has been done with them since. The temporary tariff* act of July 14, 1862, was enacted solely as a war measure, and not to remain in force longer than the necessities of the case demanded. Let me select a few T articles to show what has been done. Take the article of acetate of lead. It is merely sugar of lead, which is very largely used in manufacturing. We put a duty of 4 cents a pound on it. It has since been raised to 20 cents a pound. At pres- ent it stands 5 cents for brown sugar of lead, and 10 cents for white, which is 150 per cent, upon the price which I last received from Europe. I have not the latest fluctuations, for it has been utterly out of the ques- tion to import it for many years. No revenue, of course, is derived from that. Boracic acid, and crude borax were put upon the temporary tariff at 5 cents per pound. No man in his senses would ever put a duty of that kind upon raw material, except upon an appeal to his patriotism. I find borax is placed at 10 cenis a pound, giving a protection of 5 cents a pound to the manufacturer. Since that time — I do not know when, for I have not had time to look into it — the crude article has been made free ; but the 10 cents a pound has been kept upon the refined article. The gentleman who has made the most money out of that will not ap- pear before you. He came from Germany to New York in 1845, when a young man, to make his fortune. He is a very correct, upright, and honorable gentleman, and he has maintained his position in that respect all the way through. The great bulk of his fortune is made out of a few of these things, notably out of this very article. The next article is citric acid. We put 10 cents a pound upon citric acid, and upon lemon juice from which it is made, 10 per cent. Now^ pass to tartaric acid, which at that time in New York was much used, as it is now, and 20 cents a pound was put on that article, while the crude argol was 6 cents a pound. There has no revenue accrued to the government from any of these. The duty is now 15 cents upon the manufactured article, but the crude argol is free. Gallic acid, made from nut-galls, we jffaced at 50 cents a pound, and 298 TARIFF COMMISSION. [JOHN D. DIX. the not galls free. The duty has since been raised to $1 a pound, and nut galls remain free. Argol, or crude tartar, we placed at 6 cents a pound, and the cream of tartar (a very important article) we placed at 10 cents a pound, i'iinee that time argol has been made free; but the duty of 10 cents a pound on cream of tartar still remains. There is no revenue from that. Commissioner McMahon. Gallic acid, although it was made to pay, in 1862, 50 cents a pound, was raised to $1.50 a pound in 1864. The Witness. That may be. There was a raise on almost every- thing, I believe. At all events, the crude article was free then, and it is free now, the difference being that there was then 50 cents a pound duty on the manufactured article, and now it is $1 a pound. We also put 30 cents a pound on crude camphor, and upon the refined, 40 cents a pound. Now the crude article is free, and the tariff on the refined is 5 cents a pound ; but there is no revenue, because we can export cam- phor from this country as cheaply as they can from Europe. Licorice root, licorice extract, and paste. This is an important arti- cle, or used to be, in the drug trade. It is not now, except in the tobacco manufacture, where it is a very important article as a flavor. We put upon the root 1 cent, and upon the paste 5 cents a pound. In 1864, or some time since 1862, the duty was made 2 cents a pound on licorice, and on the paste, or extract, 10 cents a pound. Now the root is free, and the paste is 10 cents a pound. This is one of those articles that it seems utterly unnatural to manufacture in this country, but fortunes are being made by it. To draw a raw material of such low cost from abroad and manufacture it here is not a natural process, and ought not to be sustained by a heavy protective duty. The root comes largely from Smyrna and from Spain, and a little from Sicily. The cost of bringing the root in that form should be very great compared with the cost of bringing the extract from those countries. The tariff* on that is alto- gether out of character, it strikes me, upon any reasonable basis what- ever. Tobacco manufacturers have said that they can buy their paste more cheaply now than in other times. 1 do not know whether it is true or not. 1 certainly know that the paste they buy is not so -good as it formerly was, and that children in these days hardly know what licorice is. Magnesia, carbonate, and calcined, the carbonate especially, has come to be largely used in this country for the manufacture of dynamite and giant powder. The California company uses a large amount of it. The carbonate pays 6 cents a pound duty, and the calcined 12 ients. I judge there can be ho reasonable ground for any such thing. There is no manufactory in this country, except possibly one started in Brooklyn a little while ago to supply manufacturers wit!» dynamite. We hear nothing about it. I do not know even whether it is a large business or a small one. But, certainly, if it does a large or a small business, the article can be manufactured in this country just as cheaply as it can in Europe, considering the difference in cost in bringing it here — the freights, commissions, &c. Essential oils are important in every respect. They go into the manu- facture of soap and perfumery, and that class of goods. The figures which we submitted in 1862 we supposed were consistent with each other, however unreasonable, looking at it from the standpoint of political economy. The whole was consistent with its parts. Essential oil of almonds, upon which a duty of $1.50 was placed, has been since made free. I think other things ought to be made free if that is free. Anise, caraway, and citronella (soap-makers’ oils), have been made free. JOHN D. DIX.] DRUGS. 299 Cassia, which is another soap-makers’ perfumery, is free. Bergamot, which is merely for perfumery, has also been made free. This was caused to be done by monopolies. I believe I could tell who had a hand in getting it done. It was not done under such a system as you are pur- suing now, trying to make the tariff harmonious in all its parts, but it was a grinding of individual axes, against the positive promise of gentlemen who induced us to do what we did — very foolishly, perhaps, but patriotism appeals strongly to a man under certain circumstances. The oil of cinnamon is almost entirely used in the business of liquor dealers. They flavor liquors with it, and that has been made fr< e. We put $2 a pound duty on it and now it is free. Lemon and orange oils are also in the perfumery line, but they remain as they were, at 50 cents a pound. I only wish to say in regard to these other articles, that if they had made all of them free, there would have been some reason in it. But leaving out anything that was not specially applied for, is an unreason- able mode of procedure. Oil of cubobs, manufactured largely in Phila- delphia, we placed at $1 a pound, and put 10 cents a pound upon cubeb berries, giving them a small protection. The duty is now $1 a pound upon the oil, while the berries are free. Oil of cloves is also manu- factured largely. We placed that at $1, and raw cloves at 15 cents, it not being a product of this country at all, but coming from the East Indies and Zanzibar. The duty has been raised from $ 1 to $2 on oil of cloves, and the raw cloves have been reduced from 15 cents to 5 cents, showing the manipulation of somebody in interest. There are some things in the drug line that will bear a great deal of duty and make very little difference in the price to the consumer. We put opium at $2 a pound, and morphine, which is its alkaloid, at $2 an ounce. There were only two firms in the country who manufactured morphine at that time, and we gave them a protection of from 55 to 90 X>er cent. In Europe to-day, and always, since t lie manufacture of fine chemicals has become a business largely pursued, the price of morphine is less than half the price of opium. I have here the list of Powers & Weiglitman of the first of this month, from which I see that the price of pure morphine on the 1st of July was $5.50 per ounce, while it was $3.75 for the sulphate of morphia. Opium cannot come into this country unless it contains 9 per cent, of pure morphine. From that point it runs up to 14 or 15 per cent. I have seen it at 10 per cent., but that was exceptional. Now, if one hundred pounds of opium yields 9 pounds of morphine, supposing the opium to cost $4 a pound, duty paid, you can see there is considerable chance for sulphate of morphine at $5 75 an ounce making a very handsome profit. They put the pure alkaloid at $5.50, and sulphate of morphine at $3.75. The last price that I received from Edinburg, where there are large manufactories of morphine, was G,s*. (id,; that is about $1.60 in round numbers. I think the price here is very dear in proporiion. Let me say to you that when 1 first became acquainted with Messrs. Powers & Weiglitman, and Mr. Uosengarten, in 1845, they were manufacturers, and 1 do not suppose both together manufactured 100 cases of opium into morphine in a year. 1 believe last year Powers & Weiglitman made 1,500 cases into morphine. There was an immense fortune in that business, and they made it. Mr. Powers died worth probably from $7,000,000 to $10,000,000. 1 now come to a more important article, Peruvian or cinchona bark. We put 25 per cent, duty on that in 1802, and 45 per cent, duty on qui- nine and its other products. Unfortunately, I have not kept that list; but I remember the fact that we went over the list immediately after 300 TARIFF COMMISSION. [JOHN D. DIX. the passage of the act, and found that about 85 per cent, of our figures had been engrafted into the bill. Cinchona bark, that time, paid 25 per cent.; the product of the bark (quinine), 45. Since that time (in 1864, 1 think) the bark has been made free, and 20 per cent, has been kept upon quinine, and 40 per cent, upon the other products of the bark. In the year 1879, as you all know, a popular movement was started and quinine was made free. The members of Congress intended to make every product of Peruvian bark free; that was the intention of the promoters of the bill ; but lawyers are not quite as apt to know about these chemicals as some other people. It they had known that there were other products besides quinine and its salts, they would not have put that particular phrase in which excluded the rest. Quinine is of more importance than all the other products; next in value is cin- chonidia, and on which the duty remains at 40 per cent. ; and of this salt Powers & Weight man have pretty much swept the European market; it has been nearly all absorbed by them. Now, I wish to say a few words in regard to the statements made here the other day by these manufacturing chemists. They complained that everything which they used was taxed. If those gentlemen had been ingenuous and told you all they knew about this matter, I would not have appeared before you to-day to say one word on this subject. I am kindly disposed towards every interest that has any right to exist in this country, and I have not a single word to say against those gentle- men, but 1 was sorry to have my friends, White and Eosengarten, seem by their silence to assent to statements made by others which left er- roneous impre sions on the minds of this Commission in regard to the business ot quinine manufacture. I think that a suggestio falsi is almost as bad as a positive falsehood, and the suppression of a fact is not any better. They talked about fusel-oil. If it was not made a point of importance in their statement, it would be a matter of ridicule. I suppose that you all know that fusel-oil is the oil of corn that escapes from the still as waste; that it is not worth hardly anything; it is only when they can get s me little price for it that they save it. The last time I had an inquiry from abroad, the agent in New York for a Western distillery offered me a car load for 32^ cents a gallon, purified and refined, de- lived in New York. I thought it was very cheap, and think so still. The article itself, even if it is worth saving, can be hardly taken and pu- rified and cleansed at that price, for it is the most wretched rubbish ever attempted to be handled, but, when purified, it becomes fusel-oil, and they find it an excellent solvent for the Peruvian bark. They say they can buy it in Canada for 18 cents a gallon, but the duty of $2 a gallon prevented them from getting it in. Of course it did. They do not say whether it was purified or not. It may have been, for they do worn in Canada very cheaply. They were not pressed with ques- tions on the subject, but I apprehend if they had been it would have been shown that the chemicals and solvents which they require are very small affairs in comparison with the results which they produce. In regard to the capital invested in the plant for the manufacture of quinine, I have no special knowledge. 1 am free to say, gentlemen, that I am speaking only from my general knowledge of such things. Mr. Robbins, in his statement before you on Thursday last, said that they had so many boilers and engines, &c., that their capital invested — and this he said & otto voce — “including bark,” might be $150,000. You were asking him for the capital invested in the plant, and 1 apprehend that putting the crude articles as a jiart of the plant is a little out of JOHN IX BIX. J DRUGS. 301 the way. He said that their capital invested, u including the bark,” was about $150,000. Sometimes they have 30 bales of bark on hand, and sometimes 150 perhaps. In answer to questions by Mr. Kenner, I think, as to what the capital in this country in the plant was for the manufacture of quinine, he left an impression upon your minds that as $150,000 is to 200,000 ounces, so is the capital invested to 1,000,000 ounces, which he said was the product of the country. I think he over- stated the fact; but, nevertheless, I will not dispute it. I do not think it was ingenuous. I do not think it was what he ought to have stated. I do not believe that there is any $150,000 invested in plant for the manu- facture of sulphate of quinine by all of the five manufacturers. Another thing about all these fine chemicals: they use the least labor of any manufacture in the country. There are not 500 men, and I do not believe there are one-third of that number employed in the manufacture of quinine in this country. If they had stated these things as they are, I would not have said one word. I think if he had been carefully questioned, he would have made a very different impres- sion upon your minds. At all events, I would not like to buy the plant in this country for the manufacture of quinine for $150,000 as a specu- lation. If those interested gentlemen were ingenuous, and had been frank to tell you what you desire to know, and need to Know, in order to form an intelligent opinion, it would have simplified the case greatly. Unfortunately, this they did not do, and I doubt if an assurance by this Commission, of a favorable report for a 20 per cent, duty, could draw from any one of those firms an account- current of an average parcel of bark, debiting the cost of bark, labor, solvents, wear and tear of plant, &c., and crediting the actual value of the quickly salable articles of quinine, cinchonidia, &c., and also a.fair estimate of the value of other products. Commissioner Ambler. Are you able to make such an account-cur- rent for us 1 ? We do not care where we get it, provided we get it. The Witness. I cannot give it. I have heard it stated time and again in such shape that I feel I know something about it; but I have no data which would enable me to make such an account-current. Commissioner Ambler. Perhaps if you would give us the result of your knowledge upon the subject it might incite them to come back and give us that information. The Witness. I would be very glad to see them do it. I would never have appeared before you to say one word on this subject if they had done what I supposed they would do — told you the plain facts in regard to the whole matter. Commissioner Ambler. That is what we want to know; and I hoped perhaps you would be able to tell us. The Witness. I am not. I am not a practical chemist. I have talked on this subject with friends on the other side of the water who are en- gaged in this business, and I think I know something about it. I leave with you for your information a table showing the importa- tions of bark in England and France, from 1871 to 1880; also the stocks at London and Paris at the end of each year. This table shows the prices of sulphate of Howard’s quinine in the London market, which is the same in England as the Powers & Weightman in America. You will see that the prices vary very much. When the Russian war began 6.s*. 6(1. was the price of quinine, and then it went up to 16s. By Commissioner Porter: Q. Does it not generally go up during wars? — A. Yes, sir. 302 TARIFF COMMISSION. | JOHN' D. BIX. Q. Almost invariably? — A. Yes, if they continue for any considerable length of time, because the soldiers are exposed, in camping out, to malarial influences. This article of cinchonidia has been used for a few years. I presume many of you know what the different products of the bark are. Several of these are pure alkaloids, and the others are preparations from those alkaloids. You will notice that in my state- ment in regard to the difference between the sulphate of quinine (which is the article generally used) and the pure alkaloid, Powers & Weightman give the prices in ounce vials, on the 1st of July, at $2.10. It is now $2. The pure alkaloid at that time was $3.75 in the same form — one- ounce vials. I believe that there is no business in the world that could so well afford to have its profits cut down as this. By Commissioner Oliver : Q. Do they have a very large profit at $2 per ounce ? — A. I believe at tbe present price of bark they are losing money at $2. Q. Is there a large stock of quinine now held in this country ? — A. There is a large stock for the present demand. There seems to be just at present an unusual freedom from malarial diseases throughout the country. By Commissioner Ambler : Q. Relatively, how does the stock now compare with the stock before 1879? — A. Of course we do not know what the manufacturers carried before 1879. As Mr. Rosengarten stated the other day, they had a sliding scale ot prices, and we know perfectly well that they could afford to carry a good stock. They made a good deal of money. But to-day not one of all tlies6 other manufacturers can tell what the price of quinine will be; they have nothing to say on the subject whatever; Powers & Weightman fix the price. By Commissioner Oliver : Q. You have stated to us that quinine is necessary in case of war. It seems to be required in low countries particularly. In that view do you not think it would be well enough for the government to encourage, to some extent, the manufacture of it in this country so that it can be pro- cured here when needed? — A. Most certainly; I would grant them every possible facility in getting their raw material free. They have told you that there is a duty on bark. There is no more duty on it than there is on rhubarb. There is that differential duty of 10 per cent. So it is in every part of our business. We cannot draw anything from Europe that is grown in the East Indies without paying differential duty. But they suffer nothing by that. There have been growers from Ceylon who would sell Powers & Weightman, or Bosengarten, any quantity they would wish, and guarantee them a certain amount of pure alkaloid in each pound, at a less price on the average than they could buy it for in London. London is the great market of the world, and the price is what you see in that schedule. They do not care to run the risk of buying the bark in Ceylon or Calcutta. The statement which Mr. Rob- bins made about the Jamaica bark going to London is true ; it must go there. I would give the manufacturers every possible chance to make money out of their business; some of them would make money fast, and some not. The bark used to come here very largely, more so than it does now. The reason why it goes to London now (although it costs probably 5 per cent, more, at least 4 per cent, more than to sell it here) is because they can get better prices for the bark there than here. The bark used to come here, and the quinine manufacturers would send and JOHN D. DIX-1 DRUGS. 303 have the brokers get samples and send them on to them for examina- tion and test, and then make their bids. The consequence was — you can put your own construction upon it — that the business went to Lon- don instead of here. It would sometimes lie here twelve months and not be sold. The best would be sent to London and the rest was sacri- ficed here. By Commissioner Ambler: Q. In answer to Mr. Oliver’s question I understood you to say that, in view of the necessity of this product, especially in cases of war, when it might be difficult to get, it was important that the manufacture should be encouraged here, and you suggested — and I think you left the subject by inadvertence before you were done with it, and so I mention it now — the duty on bark and everything else used in the manufacture be taken off. — A. I did on fusd oil and on every other solvent ; and, more- over, I would give them a small percentage of protection besides, not to exceed 5 per cent., on an article like this; that will more than amply re- pay them. Q. I understood you to say that the fusil oil which they use as a sol- vent is so small in cost that it really does not affect the price of the product at all ?— A. Of course everything affects the manufacture. Q. I know; but it is imperceptible. — A. I do not believe there is a perceptible effect. The present high price of bark is the result of a corner in the market. But it is very much like a corner in wheat; it will correct itself speedily. Quinine can be made just as cheaply here as in England, even considering the difference in the price of labor, which is a very small matter, after all, in connection with a thing of so much value. If it was soda-ash it would be different. By Commissioner McMahon : Q. What is the objection to putting a duty of 20 per cent, on quinine ; will it not stand it % — A. It will stop importation utterly. The price of quinine in Europe is equivalent to $1.70 per ounce; in New York we are selling it at $1.87 now. By Commissioner Underwood: Q. To the best of your knowledge, information, and belief, what is the average profit made in this country in manufacturing quinine t — A. There is not any profit if you take bark and quinine at to-day’s prices. It is made at a loss ; I haven’t auy doubt about that at all. The con- dition is a very unusual one just now. 1 would like to say one thing which 1 omitted to say heretofore: that specific duties are not what they are supposed by their advocates to be. They are not always safe. They lead to difficulties, especially in manu- factured articles. When a new article is first brought out, the cost of manufacture is greater than later on when workmen become skil ed and improved methods have been tried, thereby reducing the cost materially. If, as is often the case, a moderate specific duty has been levied on the basis of the high original cost, it becomes prohibitory in time, because improved processes and perhaps home competition have reduced selling prices below the duty. Qhloroform has been named as a case in point. When we put $1 per pound on it the market value was $2.50; now it is 65 cents. There are a few articles besides in our line of business, the duty on which should be stricken off. An important article for manu- facturing pur poses is olive oil. We cannot make a fine quality of cloth by using lard oil ; it is impossible. The duty of 25 cents per gallon on olive oil is against the interests of manufacturers and consumers of 304 TARIFF COMMISSION. [JOHN H. DIX. woolen cloths especially, and of silks and cottons in a leas degree. Bel- gian, French, and English broadcloths are quite firm and softer to the touch than any manufactured here. Another article of inqiortance which should be made free of duty is saltpetre or crude nitrate of potash. It is imported almost exclusively from the East Indies, and used extensively by manufacturers of gunpow- der and chemicals, and by packers of meats, and the public generally. None of the animal oils make such smooth, fine texture as vegetable oils. The duty should be taken oft* common olive oil in the interest of our manufacturers. Salad oil is another matter, but being a luxury, it will bear a 50 per cent. duty. It is the other interest that strikes me as important enough to claim your attention. I could go through a long list of these chemicals that are protected in some way for the benefit of a few manufacturers, but I do not wish to take up the time of the Com- mission. E. L. RANLETT.J REDUCTION OF DUTIES. 305 E. L. RANLETT. Long Branch, N. J., July 31, 1882. Mr. E. L. Ranlett, representing the New Orleans Cotton Exchange and , certain manufactures, appeared before the Commission and made the following statement: I hoped that perhaps the way might be paved by the gentleman who preceded me to a proposition for a reduction in the tariff; but as 1 have the honor to propose a reduction, I will state why and on what basis I do it. I believe it has come to be an accepted fact by the American people that for purposes of revenue the present tariff law yields more than the requirements of the government, and many believe that for purposes of protection (a recognized part of our tariff policy) it has become in cer- tain respects oppressive, in others inadequate and unjustly discrimina- tive; and all this as much from the fact of the vast changes wrought in our great agricultural, commercial, and manufacturing interests during; the last 15 years as from any inherent defect in either the letter of the original law or the principles on which it was founded. I am before you to ask for such changes as will, I trust, obvious, ly benefit a greater number of people than they will distress. And, as a general basis, 1 assume that the revenue will be obtained from such articles produced solely, or in large preponderance, in foreign countries;, and the subject of general consumption in America, and that the excep- tions will be where the raw materials are imported for the purpose of manufacture, and where such manufactures have a position in the com- merce of the world — the exception placing a premium on American labor— as in contradistinction to a duty which has no protective in- fluence and hampers the American maker in placing his product in foreign marts. I hope and believe it will be found that protection means to secure to the pioneers of each section a fair return for the capital and labor 4 , employed, without special detriment to any other class of producers in ! any other section whose claim to American citizenship and protection! is just as good. In short, if a tariff* must exist for revenue, it should!! produce no more than the requirements of the government, and if it beq necessary for protection, it should not largely benefit monopolies, foster 1 sectional feeling, or give a preposterous return for capital invested m the manufacture of the articles so protected. Coming from a section that needs protection, and being a citizen of a country that requires, a revenue, I believe the interests of all are best served where the burden falls fairly on the consumer without regard to locality. In behalf of the New Orleans Cotton Exchange, and the producers of cotton in the South, I ask that the duties on jute butts and iron cotton- ties be abolished. The revenue from iron ties is less than $500,00$ per annum. These are not exact figures; the statistical information; I re- serve the right to supply, because $50,000 or $00,000, in a matter of this - kind, might make considerable difference. The revenue derived from jute used in making bagging is less than $125,000; and on all tlie low- . grade jutes imported, it is less than $1,000,000. As articles producing - H. Mis. G 20 306 TAIRFF COMMISSION. [E. L. RANLETT. revenue, they are, therefore, insignificant; while, as a matter of protec- tion, it susely must be evident that a reduction in the cost of producing an American crop of which a large proportion is exported, is the very acme of tariff reform. The interests opposed to this change I contend are individual, and not even sectional ; for, as a matter of fact, one firm in Pittsburgh can supply the iron ties for the entire Southern crop; and I believe the true principle of the tariff does not contemplate that in- dividual enterprise should be preferred to the general good. No article of American growth has yet been found suitable for the purpose of bal- ing cotton. 1 will state, in this connection, that the cotton exchanges of the South have generally passed resolutions objecting to the use of articles of Ameri- can growth for bagging because it is claimed that they stain the cotton. As a matter of fact, ^ of all the jute used in baling cotton is imported ; which makes protection in that case a farce. The existing law, I am perfectly willing to allow, does not impose a very heavy burden on the planter. As a matter of fact a half million dollars duty is very little to pay from such an interest, if the government requires revenue; but, if it is the policy of the government to cheapen production, no duty should exist on iron ties at all. I have said thus much in behalf of the New Orleans Cotton Exchange. What I shall say in addition will be in behalf of other interests, and I should like to separate my remarks. I shall be happy now to answer any questions that may be asked in regard to what I have said. By Commissioner Garland : Question. What is the average cost of the material used for bagging ? — Answer. Perhaps 8 to 9 or 10 cents a yard for bagging; and 5 cents a pound for the ties. Q. What is the price of cotton per pound ? — A. Twelve cents, appar- ently. Q. Do you mean to say that these cotton-ties, bought at 5 cents per pound, are sold with the cotton at 12 cents ? — A. Yes, sir. Q. Then there is a profit of 7 cents a pound on the cotton -ties ? — A. I will reply exactly as I answered Mr. Windom last year, when I appeared before him: “Does anybody know who pays the tare on an article sold without tare?” Here is an article without tare. Suppos- ing that you bought a bale of cotton weighing 500 pounds gross weight, and the ruling of the exchange is that after the 1st of Jan- uary cotton shall be sold at net weight; would you not get less for the bale of cotton? As a matter of fact cotton brings less on account of that very fact, and therefore the planter does not obtain the benfit to which you allude. That must be manifest to every merchant. By Commissioner Ambler : Q. Is not the price of cotton in this country fixed by the price of cot- ton in Liverpool? — A. Of course. Q. Then do they not strip it of bagging, ties, and everything else?— A. No, sir; not in New Orleans. Q. I am speaking of Liverpool ; do they not strip the cotton, taking off ties and bagging, and weigh it? — A. American cotton is bought in America by agents of English houses in Liverpool. The Liverpool mer ehants have a knowledge of the way cotton is sold in this country, so that when they give an order for one thousand bales, they know it means Avitli the bagging and ties around it (gross weight), and they calculate so much for the packing, and pay so much less. E. L. KAN LETT.] REDUCTION OF DUTIES. 307 Q. So that in Liverpool they pay for the cotton they get; and, although apparently they pay for the bagging and ties, yet in regulating the price here they allow for the bagging and ties? — A. Yes, sir; and the Amer- ican producer loses it; that is the point I wanted to make — that there is no gain to the American producer by reason of the fact I have alluded to. By Commissioner Oliver : Q. Have we not now control of the markets of the world, so far as cotton is concerned ? — A. I suppose so. I am not a cotton man and cannot say. Q. You are speaking for the cotton interest ? — A. I represent the Cot- ton Exchange ; but the controlling influences in the cotton world I have not studied. I assume, from what I have heard, that America certainly has some influence on the markets of the world. Q. In that view, could you not modify your request that cotton ties should come in free? — A. I assume that taxation, not to be oppressive, must be general, and this is only another form of taxation. You might with just as much propriety say, u Put all the revenue that the country requires upon one section. 77 Q. You have shown that this is a tax of only $500,000 ? — A. That is all, and the country does not need it for revenue; if it did, I would say keep it. Q. Has not the article you complain of to-day the least duty put upon it of any article of iron or steel imported into this country? — A. Unques- tionably it has. It is 35 per cent, ad valorem. Q. About $11 per ton? — A. Fourteen dollars. Q. Therefore it is the least of all ? — A. I grant that. Q. And you say that we ought to take even that off? — A. Unques- tionably ; if there are $140,000,000 in duties to come off, it may as well be given to the producers of American crops, and I believe many are in- terested in that principle all over the country as well as the cotton pro- ducers of the South. In behalf of the house I represent, I ask the abolition of the duty on manilla and sisal or Mexican hemp. American manufacturers are using in the aggregate of these two articles three-fourths of the world 7 s pro- duction. Hope is an article of general consumption, alike South, East, North, and West, and a protective tariff on it cannot be considered as operating as a sectional discrimination. There being no article grown in America to take the place of either sisal or manilla, unless the reve- nue is required I believe the abolishment of the duty on these fibers will place a premium on American labor and enable our rope-makers to enter the markets of the world on an equal footing with other countries and without undergoing the vexatious delays and exactions incident to obtaining a rebate on exports under the existing laws. An examina- tion on your part of the information at hand will show that there is noth- ing in America to take the place of either of these two things ; nor can there be. There is every reason for placing the tariff on manilla hemp as low as possible on account of our shipping interests. Sisal also is used very largely in the agricultural interests of the West, and therefore we would like to see the duty upon it made as low as possible. Ma- nilla is used largely in harvesting crops. JLt is important that the har- vest of the Northwest should be gathered as cheaply as the harvest of the South. But, as it is an article of general consumption, it is only fair that it should receive a certain amount of protection when in a manu- factured state. That is all I can say on that point. 308 TARIFF COMMISSION. [E. l. eaxlett. By Commissioner Ambler : Q. Are you engaged in its manufacture in any way ? — A. Yes, sir. By the President : Q. What is the duty on mauilla ? — A. Twenty-five dollars a ton. The whole duty amounts to less than a million of dollars. By Commissioner Garland : Q. Did I understand you to say that we depend for our supply upon other countries altogether? — A. Yes; and as the Americans are going ahead so fast in the excellence of their manufactures it is only fair that they should have an opportunity to put their rope in all the markets of the world ; and, in order to do that, the fewer restrictions placed upon inanilla as a raw material, the better for American producers. I want you to see that I am not inconsistent in asking for a protection on rope and at the same time saying that cotton ties should not be pro- tected. I claim that where an article is of general use, absorbing nearly all the raw material in the world, we should have a chance to take it all and a chance to sell it all when manufactured. Xo rope made any- where else in the world compares with the American manufactured article. If you have no further questions upon this topic I shall proceed to the consideration of argentiferous ores. This subject introduces another phase of the tariff system. Originally the law in its effect combined protection and revenue. Xow it accomplishes neither, in the sense understood by its framers. Lead, for instance, is no longer imported, and the consumers this side of the Mississippi Biver have to pay the entire amount of the protection to the long lines of railroad between them and the points of production, and between the factories east and the points of consumption over the country. Clearly, the consumers can- not be expected to subscribe over $2,000,000 yearly to freight lines in order to sustain the mining interests of the far West. And just as clearly these miners are deserving of some consideration in regard to an article of general consumption. This is one of the cases where there must be a demand for labor produced, equal, or nearly equal, to the amount curtailed. If we admit lead free, we only attain part of our ob- ject. But I believe the admission of argentiferous lead ores, without the present duty of $30 per ton, will act as an equalizer in the alter- native above suggested. Before the development of the huge argen- tiferous deposits of Xe^v Mexico and Colorado, lead could be brought to this country, even under the tariff, and taken as far west as would be indicated by a straight line drawn south from Chicago. Here is a case where $2,000,000 is diverted from the laborer and the capitalist and passed into the hands of railroad corporations. If the protection of railroad corporations was the avowed object of the tariff, or if they were objects of charity, and the people were inclined to sub- scribe $2,500,000 yearly for the payment of interest on their bonds, I would not object. All the lead used in this country comes from the other side of the Mississippi. The greatest consumption is on this side of the river. From $20 to $25 a ton on 110,000 tons is annually paid in railroad freights in order to get it to points of consumption. I question if there is a more difficult phase of this tariff question to consider than this. Certainly the American miners in the far West must have con- sideration, and the manufacturers and consumers are entitled to some consideration also. The dilemma is a serious one. By admitting argentiferous ores (part gold and part silver or copper) E. L. RANLETT.] REDUCTION OF DUTIES. 309 into the United States free of the duty of $30 a ton, we can produce a demand for American labor, secure an influx from Mexico and points in the Southwest ; the lead manufacturers of the Atlantic coast can pro- cure their lead at about an equal price with the same manufacturers in the West, and the consumers in the Southwest and Northwest will pay an equal price for their manufactured article. If I understand the principles of tariff reform correctly, that is about what we are striving for — that no man shall be taxed at the expense of another; that no sec- tion shall pay the expenses of another or receive protection at the ex- pense of another; and that no monopoly shall be protected. I have simply stated my case, and have endeavored to avoid statis* tical references ; they are all of record in the customs department, and can be obtained without trouble. A full discussion of this subject of ores would take more of your time than I care to ask or feel competent to profitably occupy ; but I have no doubt my introduction of the sub- ject will bring forth expression from the interests involved, and thus the matter will be thoroughly ventilated. Gentlemen, I am much obliged to you for according me so prompt a hearing. 310 TARIFF COMMISSION. [DANFORD KNOWLTON. DANFOBD KNOWLTON. Long Branch, N. J., August 1, 1882. Mr. Danford Knowlton, of New York, appeared before the Com- mission and made the following statement : Mr. President and Gentlemen of the Commission : I am happy to appear before you and say a few words on the subject of the duty on sugar. I have no doubt the subject will be ably discussed by others, but I will offer a few remarks, as briefly as possible, and not consume your valuable time. In the first place, I would like to call your attention to the method of manufacturing sugar, as I have seen it in the West Indies and in France. The sugar of commerce may be produced from cane, beet root, or any vegetable that contains saccharine matter. The cane is pressed with very heavy rollers, after which it is mixed with sufficient quicklime to prevent the acidity which it would naturally take from the atmosphere, because it must be worked in a neutral state — neither be acid nor alka- line — in order to give good results. When the lime is applied to this juice, which is generally heated, a scum rises to the top, and, by one process of manufacture, after being removed to some extent in the vat, it is skimmed continually while being boiled in open kettles or pans. The boiling in open kettles requires a heat of from 212° to 240° Fahren- heit. After further boiling crystallization commences and sugar is formed. It is then a mass of sugar crystals and molasses, or other uucrys- tallizable substances which come from the cane, caused by the extreme heat which is applied to it in boiling. If cane is sliced very thin and exposed to the solar heat, or a temperature of about 120°, as it exists in the tropics, the water will be evaporated and very fine white crystals will be formed. But when boiled in the way I speak of, a portion of the saccharine substance is burnt, becomes dark in color, uncrystal lizable, and when sugar is formed it remains mingled with the grains of sugar. The ultimate crystal of sugar, is white, as you will find by washing, and the reason why it is not white when purchased is because of the burnt substance that adheres to the exterior of the crystal, gives color to the sugar of commerce. By another process of manufacture heat is applied, in a deficator and the impurities are thrown to the surface or precipitated to the bottom, and the juice is drawn out comparatively clear. It is then introduced into vacuum-pans, and there it is boiled, in consequence of the removal of the pressure of the atmosphere, at about 140°, subjecting it, as you will see, to only a little more than one-half of the temperature required to evaporate it in the open pans. This is the more modern way of ob- taining sugar. When it is drained out of the vacuum-pan, it has also the same qualities of sugar crystals and molasses mingled, the molasses sometimes by high boiling being rendered almost black or very dark, and partaking somewhat of the nature of caramels. Then, in order to clear the sugar, it is put in the centrifugal machine, which revolves with a rapidity of from 1,200 to 1,400 revolutions per minute, and in that way the molasses is thrown away from the crystals. Bear in mind all the while that the ultimate crystal is white, and you will see very clearly DANFORD KNOWLTON.] SUGAR. 311 that all that is required to render those sugars more or less white in the process of manufacture is more or less perfection in clearing away the exterior coating of the crystal, and that is done by washing with steam or with water, or with a mixture of sugar, sirup, and water, as the case may be. Having ventured thus much on the manufacture of sugar, which you may see will apply in the further course of my remarks, I will say now that I think the evidence that will come before you will be generally in favor of reducing the duty on sugar. I consider the duty on sugar very high. The importers may consider the duty too high, while our Louisiana friends consider perhaps that it is too low. They are entitled to their opinion, and they will undoubtedly give it to you. As an ar- ticle that enters into the consumption of every man, from the cradle to the grave, a tax of between GO and 70 per cent, ad valorem seems to me too high, while silks and many other articles of luxury are not taxed so much. But whether the duty is too high or too low on sugar, does not enter into the question which I shall present to you. The mode of manufacturing sugar by the vacuum-pan and centrifu- gal has been much spoken of as producing sugar better than was antici- pated when the tariff was created. That it is possible in the manufac- ture of sugar to produce a very valuable sugar and still keep it at a low color, is very evident to those who have seen the working of the system, because when these crystals begin to form in the pan at 42° by saccha- rometer the system is to increase those crystals by adding more of the cane-juice or sirup produced by the boiling of the cane, and to continue boiling constantly, increasing the size of the crystal, and in that way you may produce a crystal almost any size you please, like rock candy. The manufacturer has always the ability to make sugar suited to any color you designate in your tariff. He can produce sugars of a very high commercial value at a low color, and that has been complained of in this country. After the enactment of the last tariff I was appointed as one of three gentlemen in New York to inquire into and report upon a proper draw- back to be placed upon sugar. We made inquiries, and procured all the information we could get in this country and in Europe, and endeavored to ascertain the amount of duty which should be given when refined sugars were exported, being the equivalent of duty paid to the govern- ment upon the importation of the raw material from which they were made. In the report which the gentlemen requested me to write, I informed the government of this system of making sugar of a high commercial value at a low color. Nothing came of that. The report was accepted, but no action was ever taken to remedy this defect in our law, which has failed to reach a proper duty on low color and high test sugars. I sug- gested to Mr.Wood, chairman of the Committee on Ways and Means, that by taking another system of grading sugars than the Hutch stand- ard, they could reach those sugars. Following that, Mr. Sherman, Secretary of the Treasury, attempted to enforce the duty on one class of sugar only, based on the polariscope test. That attempt proved abortive. Not so much was the system ob- jected to as the manner in which the attempt was made. Merchants became rather excited when they learned that the Secretary of the Treasury, a mere executive officer of the government, had attempted to supersede the legislation of Congress, and it was objected to on that ground. I have myself objected to it for the same reason, feeling that the power of Congress should not be taken out of its hands, as clearly 312 TARIFF COMMISSION. [DANFORD KN'OWLTOX. confided to it by Article I, section 7, of the Constitution, which says that “all revenue bills must originate in the House of Representa- tives, but the Senate may offer amendments, as on other bills.” We felt that this being a revenue measure should have originated in the House, and not upon the mere ipse dixit of an executive officer of the govern- ment. I brought the first suit instituted in the United States upon that question, and received back the money for overpaid duties. Since that time, the question has been decided by Judge Wallace, in the circuit court, and appealed and decided in Savor of the importers by a full bench of the Supreme Court of the United States, and consequently the merchants receive back the duties overpaid in consequence of that order. I was speaking about the polariscope as a proper test for the duty ou sugar. In consequence of the order of the Secretary only applying that test to one class of sugar, it has never been fairly applied. It has been repudiated by the people, and will be much spoken against undoubtedly before you. The system of grading the duty on different classes of sugar was adopted originally to conform to the then existing opinion of the commercial value ; in other words, under the old system of manufactur- ing sugar it was believed that color was a sufficient guide to value, and therefore the Dutch standard of numbers was arranged in such a man- ner as it was believed would give an ad valorem duty on sugar. But in this latter part of the nineteenth century, we have discovered through scientific investigation, that there are other and better modes of manu- facturing sugar, and to those modes the Dutch standard fails to apply. Consequently, we think that the system having been abandoned by those who deal in sugar and who are supposed to know most about it, as no longer a guide to the value of sugar, it would be just and proper that the government should abandon it, and substitute the system which has been adopted by merchants to determine its commercial value. That system is the use of the polariscope, an invention made in France, an instrument by which the crystallizable quantity of sugar in any given mass may be determined with great accuracy. France has arranged her duty accordingly, and it is applied to-day in all the internal-revenue col- lections on the beet-root sugar, with which France supplies herself, and of which she exports a great deal. And the duty ou that article is levied in France by the polariscope. This system, having been found to be the most accurate in determining the commercial value of sugar, has been adopted by all the intelligent merchants here and in the larger sugar-producing countries in other por- tions of the world. Iinstead of assessing the duty on color, which does not represent the commercial value, the value is fixed to the merchant on the polar iscopic strength of the sugar. For instance, if sugar gives you 95° or 100° by the polariscope, showing that there are so many degrees of crystallizable sugar in the mass, it is worth more than sugar that only makes 75°. In other words, it is worth nearly exactly one-fourth more, and consequently that system has come into daily use, and all our quo- tations of sugar now are made on that basis. To illustrate that, I can show you a weekly circular issued and sent abroad every week, which contains quotations from the brokers, in which you will see that the quality of sugars is given by the polariscopic strength, and the price ranges accordingly, while the Dutch standard is ignored. By Commissioner Kenner : Question. Is the price based on the polariscopic test alone ? — Answer. Almost entirely. For instance, Ko. 7, Dutch standard, will polarize the DANFORD KNOWLTON.] SUGAR. 313 same and perhaps even more than No. 8 or 9, in which case its value is considered to be equal to that of the higher numbers. By Commissioner McMahon : Q. What would you call the standard — 95° or 90° ? — A. There is no standard. Q. What I want is the average. — A. According to the perfection of the manufacture j all the way from 99° down to about 75°. Q. What is the average that comes into this country? — A. Average vacuum-pan and centrifugal sugars will range from 92° to 99°; the larger portion would be about, say, 95° and 96°. By Commissioner Kenner : Q. You are not speaking of sugars used for refining purposes? — A. Those are used very largely. The largest manufacturers use them more or less, and some use them almost entirely, while others use a portion of one kind and a portion of the other. Let me remark here, that refining sugars simply means taking away the color. Take the vacuum-pan centrifugal sugar of 95° or 98° test, and put it in the centrifugal and wash it, and you have white sugar. You only take off that infinitesimal coating on the crystal which is the inevitable result of boiling under a high degree of temperature. As scientific investigation and modern improvements have shown that the Dutch standard of color is no longer a guide to commercial value, is it unreasonable that we should ask the government to adopt, as a standard of duty, that which the merchants have proved to be cor- rect ; that which gives the exact value of sugar, instead of basing it upon an uncertain and erroneous system where color is concerned, when color is no longer a guide to value? In other words, a duty levied upon the polariscopic test is in the first place a specific duty ; in the second place, it is ad valorem, because it is fixed upon the value of sugar by polariscopic strength, which is its value for sweetening, and that value is determined by the polariscope; and, whether it be 75 or 100 per cent., you put upon the article a duty which its sweetening power, its com- mercial value demands, and you put it equally upon all sugars, favoring none and injuring none. I think we should avail ourselves of modern invention to arrange the duty according to what science has determined to be the correct standard of value. Still farther, this is ad valorem upon the value at home. The same principle which I propose to you of assessing duty upon value is already in operation in our tariff. We charge on first-proof liquor so much, and so much on second-proof, third-proof, and fourth proof, accord- ing to their strength. I only propose that that system be applied to sugar, because if you condense into one gallon a value which would exist in a gallon and a half under other circumstances, it is not right that that gallon and a half should pay the same duty per gallon as that which is condensed into smaller compass; and so of sugar. If you get the com- mercial value of a pound of sugar to exceed that of another pound, it is not fair or just that they should pay an equal rate of tax, and I think that point should not be forgotten. Nor should it be forgotten that this is not ad valorem only, but it is also ad valorem on home valuation, be- cause the polariscopic test of sugar to-day is its commercial value. In offering you these suggestions, gentlemen, I propose, first, a fixed or specific duty of 2 cents per pound on all sugar, melado, concentrated melado, concrete, tank bottoms, sirup of sugar cane, or other saccharine sirups. 314 TARIFF COMMISSION. [DANFORD knowlton. By Commissioner McMahon: Q. Not compounded sirups; we have fruit sirups? — A. I mean sugar- producing* sirups. By Commissioner Kenner: Q. You mean sirups producing sugars? — A. Yes. The words “or other saccharine sirups” have always been overlooked in our tariff. It has been a wonder to me that people have not imported beet sirup and manufactured it here. The tariff' says sirup of sugar-cane, but does not mention' sirup from any other saccharine-producing substance. Then, in addition to that, I say a dutiable pound of sugar shall be deemed and declared to be, for the purposes of the act, 100° of crystalli- zable sugar, as shown by direct polarization in the state in which it is imported — not by dry substance. The condition in which it is imported is the condition in which the buyer takes it; consequently the polariscopie strength ot it at that time should be the correct basis for duty. The proposed duty of 2 cents a pound is not altogether a fixed limit. You may make it 3 cents a pound, to please Louisiana, or you may make it 1 cent a pound, to please the consumer of sugar who complains bitterly of the high tariff. I simply take 2 cents a pound as an illustration. In order to illustrate the system, I have made a few figures: 100 pounds sugar avoirdupois polarizing 100°, at 2 cents $2 00 100 pounds sugar avoirdupois polarizing 99°, at j- 0 9 0 - of 2 cents 1 98 100 pounds sugar avoirdupois polarizing 98°, at -nfhosphate rock, and I import guano and everything pertaining to chemical fertilizers. Such statistics are only known to those engaged in the trade. In Charleston, S. C., about 125,000 tons of chemicals are manufactured ; in Wilmington, N. C., in Augusta, Ga., in Atlanta, Ga., and in Chicago, there is a large amount made ; and Baltimore, I suppose, manufactures 150,000 to 200.000 tons ; Philadelphia and Wilmington, Del., manufacture, be- tween them, perhaps 150,000 tons. New England manufactures nearly 100.000 tons ; New York over 100,000 tons. Q. Are there any statements to that effect in any public print? — A. No, sir; they are known to myself from personal contact with large man- ufacturers. Q. Do you xmetend to say that these manufacturers do not make statements to anybody else? — A. I suppose not. In dealing with phos- phate rock I know precisely what the output is. Of course, it is my business to know these facts, because I am engaged in selling the raw material to the manufacturers in England aud in this country. Q. Are you sole agent for the whole South Carolina business? — A. Not at all. Q. How do you know how much other people manufacture? — A. I JOSEPH CAMPBELL. J SULPHUR ORE. 331 may mention to you that the annual production of South Carolina phos- phate is about 350,000 tons per annum ; 150,000 tons of that will be ex- ported to Europe, and 200,000 tons of South Carolina rock are consumed in this country. It is a colossal trade. I came over to this country in 1870, and have been mining in South Carolina. I do not think 50,000 tons were mined in 1870 ; but tcPday we are mining at the rate of 350,000 tons per annum. This phosphate deposit in South Carolina is second to none. It is of medium grade, and is perfect of its kind. The man- ufacture of chemical fertilizers has been quadrupled in a little over a decade, for I do not suppose more than 150,000 tons were manufactured in 1870. By Commissioner Garland : Q. What would be the effect upon the market to import this fertilizer free ?■ — A. It would give it to the farmer cheaper. In England the farmer gets his superphosphate at a price nearly 25 per cent, less than the American farmer. Q. What is the object in the manufacturer asking to have it furnished more cheaply? — A. I do not represent the manufacturer; I represent the seller of the raw materials. Q. You want to increase the consumption of the rock? — A. Yes, sir ; and o# the sulphur ore, because then less rock will go to England, and more will be used here. You understand that the United States holds the key to the situation on the question of artificial fertilization. She alone has the mineral phosphate deposit of the world. Q. What is the present price of these fertilizers ? The Witness. Do you mean the manufacturer’s price? Commissioner Garland; Yes. The Witness. The farmer can go to the manufacturer and buy the superphosphates at a price varying from $20 to $30 per ton. The dealer buys it somewhat cheaper, because be buys in quantity. Q. What is the difference between the price of that manufactured in this country and the imported article? — A. I may explain to you, first, that the price of superphosphates in this country has been unduly depressed by the importation of 80,000 tons from England, so that we are in a peculiar condition. The price ought to be higher in this country ; and if the manufacturer in the United States made his estimate at the minimum price of sulphur ore, then he would be able to take off perhaps 10 to 20 per cent, from the nominal price in his transactions with the dealer — not from the present price, which is too low, I think, owing to the fact that English phosphates can be imported. By Commissioner Boteler : Q. Your idea is that the manufacturer of superphosphates, and con- sequently the consumer also, will be benefited by the introduction free of this sulphur ore? — A. Yes sir. Q. The manufacturer will then be able to sell more cheaply to the con- sumer? — A. Yes; and England, instead of exporting chemical fertilizers to America will receive them from the United States. By Commissioner Underwood : Q. Have you heard of a large deposit of sulphur ore which has been found in Louisiana or Texas? — A. I have not. We frequently hear of new deposits of sulphur. I have heard of deposits of iron pyrites, and copper pyrites, but they are usually so chemically impure as to be unfit for the purpose of acid making. Q. They are using them in Savannah, Ga. ? — A. It is not pure sul- 332 TARIFF COMMISSION. [JOSEPH CAMPBELL phur. They are using Georgia pyrites, but they are using it for the value of the cinder, which contains copper. I do not believe an ore has ever been discovered in this country which could be profitably used for the sake of the sulphur alone. By Commissioner Oliver: • Q. If this sulphur ore were placed on the free list what would it dis- place in this country ? — A. Nothing that I am aware of. By Commissioner Boteler : Q. If sulphur ore came in duty free, would it not displace newly-dis- covered brimstone or sulphur deposits? The Witness. Do you mean pure brimstone, or a mixture? Commissioner Boteler. Not chemically pure brimstone, of course, but very nearly pure. A. I suppose it would ; but I am not aware that any brimstone such as the Sicilian can be found in this country. By Commissioner Kenner : Q. Do you know the purity of Sicilian ore ? — A. It is almost entirely pure. These heavy raw minerals will not bear the cost of transpor- tation. „ . Q. Are not these minerals which are brought from Nevada and Cali- fornia beating the cost of transportation ? — A. That is owing to the gold and the silver in them. These raw products will not bear much trans- portation. We can bring them from Spain and Italy, but if vessels did not bring some such cargo they would have to come to this country empty in order to get the freights of grain to carry back. That is the only reason why we are enabled to import these bulky raw minerals. GASTON L. FEUARDENT.J ANTIQUITIES. 333 GASTON L. FEUARDENT. Long Branch, N. J., August 3, 1882. Mr. Gaston L. Feuardent, of New York, appeared before the Com- mission and made the following statement: Mr. President. Antiquities, until the year 1870, were on the free- list; but an act passed by Congress in that year, intended to enlarge the free list, added a few words which have had the effect, instead of making them all free, to make free such articles only as are specially imported, and are not for sale. In 1877 there was a large collection of antiquities brought into this country. The Treasury Department declared that they were uncondi- tionally free of duty, although they were for sale, because the act of 1870 was intended to enlarge the free list, not to restrict it. But, in 1878, I myself imported a collection of antiquities, whereupon the Treasury Department changed its ruling and declared that if they were imported for sale they must be classified as model objects, and charged duty according to their different materials. In 1882. in a suit brought before Judge Bond in the United States court, he declared that the act of 1870 was meant to enlarge the free list, and that it could not be restricted, so that at present the subject remains in an uncertain state. I beg to present to you the fact that in other countries the exporta- tion of antiquities is prohibited, but never the importation ; it is rather invited. Also, that those few words put in our law, u specially imported, and not for sale,” make, I have to submit, a distinction between antiqui- ties. For instance, a dealer here cannot import antiquities, while every- body else can import every day any amount of them; therefore, the for- eign resident dealer has a great advantage over the dealer in this coun- try, because he can, at any time, send his goods without paying duty, while the resident dealer here, who is responsible for his actions, is charged from 25 to 40 per cent, ad valorem. Of course the collector has to rely, to a great extent, on the honesty of the dealer. If I import an iron weapon made sixteen hundred years ago, that weapon, which can hardly be handled, is charged 25 per cent, duty ad valorem, notwithstanding its great age, just the same as if it had been recently manufactured. I beg to submit that that duty will prevent the importation of desired objects. There is an item not to be found in the tariff ; I refer to objects of collection, by which I mean collections of objects made prior to this century and after the medimval period. They are generally regarded as being imported for the purpose of instruction, and not in the way of competing with our manufactures, and therefore they do not enter into the question of the relations between producer and consumer. It is more a question of the production of human genius addressing itself to human taste. In every other country, however, such articles are free of duty. The third item which I beg to speak in regard to is plastic art. At present, such articles are charged 20 per cent, ad valorem. They can- 334 TARIFF COMMISSION. [GASTON L. FEUARDENT. not be faithfully copied here, and I beg to submit that it is very desir- able that all plaster casts and photographs of such objects should be put upon the free list. By Commissioner McMahon : Q. Whether for sale or not, do you mean ? — A. Whether for sale or not. Gentlemen, I beg to leave on your table an argument written in 1881 by Dr. Holland, on that very subject, which is priuted in Scribner’s Mag- azine. It covers the whole ground, and, with your permission, I will leave it with the Commission. I wish to add that the small duty of 10 per cent, which is now levied on works of art hardly prevents the importation of desired objects, while it does not protect the artist here, as these objects are imported in large quantities. Commissioner McMahon. If the Commission will allow me, I will ex- plain what I think Mr. Feuardent wishes to say. On page 185 of Heyl, at section 1528, it says: ‘‘Cabinets of coins, medals, and all other collections of antiquities,” regardless of their use; and at section 1555, “ collections of antiquity specially imported and not for sale.” Under these two clauses there have been imported large numbers of antiquities for the encouragement of taste and art. The Treasury Department decided, first, that by the term “antiquities” is meant the productions or works of ancient times as contradistinguished from those of recent periods; and, second, that by the term “ all other collections of antiquities,” inasmuch as it is in the same paragraph with “ cabinets of coins and medals,” it means “ all other similar collections of antiquities.” So that, according to that construction, the law would read, “ coins, medals, and all other similar collections of antiquities im- ported and not for sale”; but if imported for sale they pay duty. With reference to the act of June 6, 1878, to which Mr. Feuardent has referred, he Avishes the articles mentioned therein to be admitted free of duty for the encouragement of the arts and science, whether, for sale or not, and wishes to add to that the words “objects of collection,” according to the sense in which they are used in the British Museum. The Witness. Prior to the mediaeval period they are called antiqui- ties, and between that and prior to this century they are called “ objects of collection.” ALONZO M. VITI.] STATUARY. 335 ALONZO M. VITI. Long Branch, N. J., August 3, 1882. Mr. Alonzo M. Viti, of Philadelphia, appeared before the Commis- sion and made the following statement: While expressing to the honorable president and members of the Tariff Commission my thanks for the asked -for interview, I will en deavor to present my views on the present condition of the tariff relat- ing to the duties imposed on marble statuary in as brief and concise a manner as possible. I will not make any remarks regarding the duty on marble in blocks, as that will be argued by other firms engaged in that business. I understand the object of the Tariff Commission is to hear the dif- ferent views of business men of the country, for a continuance of exist- ing duties, or for a reduction of duties. And here, before going any further, I congratulate the country that this Tariff Commission is formed, for a commission composed of gentlemen with sound business views, and not biased one way or the other, is the only means of ever coming to a proper understanding regarding all the vexatious questions the present tariff* causes the importer and the Treasury Department. I will now state that my object in having a hearing before you is not so much to ask for a reduction or change in the rate of duty imposed on statuary, as it is to have an equal duty made for all persons who are engaged in the importation of foreign statuary, so that no' differential duties shall exist between American dealers and sellers of statuary, nor between foreign and American dealers in statuary, especially when the former are entitled under treaty to enter their property at the same rate of duty as Americans. The law imposing duty on statuary says that u the professional pro- ductions of a statuary or of a sculptor only , shall pay 10 per cent . duty.” For years past statues of all kinds in marble paid 10 per cent, duty, but suddenly and without warning to importers the department has con- strued the above law in such a manner as to exclude from the 10 per cent, duty all copies of antique statues, although these copies may have been made by eminent professional sculptors. It appears to me that all statues in marble or stone carved by professional sculptors should be admitted at 10 per cent, duty, for after all an original statue is but a copy in marble from the clay model, and must be done by a professional sculptor. The department, though, has decided that a copy of a statue is not the production of a statuary or sculptor, and is to be considered a manufacture of marble, subject to 50 per cent. duty. It often happens that a sculptor makes a statue in marble, which pleases many art admirers, and the artist gets orders for others. Are not all the statues this artist makes works* of art? You will certainly agree with me that they are all his professional productions as a mod- eler and sculptor. Now, Antonio Canova, one of Italy’s greatest sculptors, made, in the year 1793, his famous group of Love and Psyche reclining, now to be seen in the royal palace of Compiegne, France. Then, in 179G, he re- peated this same group for the Russian Prince Youssauppoff, and as a matter of course this second was a copy. In the year 1805 Canova made the statue of Venus coming from the Bath, now in the Pitti Palace of Florence, Italy. From the same model two other statues 336 o TARIFF COMMISSION. | ALONZO M. VITI. were executed by him, one for the King of Bavaria, the other for the Prince of Canino. Here, therefore, are three statues of the Venus com- ing from the Bath, by that great sculptor, and I think any intelligent mind would pronounce them to be all three works of art, the original one as well as the two copies. What would Canova think were he to rise from his grave and hear that the Secretary of the United States Treasury had decided that copies of works of art were not to be classed as works of art, and therefore that Gan ova’s group of Love and Psyche, made in 1793, and his Venus from the Bath, made in 1805, and which is in the Pitti Palace, were his professional productions ; but that his Love and Psyche, made in 1796 for the Russian Prince Youssauppoff, and his Venus from the Bath, made for the King of Bavaria and the Prince of Canino, were not his professional productions and not works of art, but were manufactures of marble? I think that you will agree with me that all those pieces of statuary made by Canova were works of art, both original and copies. j Art should be encouraged in all its branches, and to exclude copies of antique statues would be injurious, for the reason that the antique is the universally acknowledged instructor of modern art. Now these original antique statues cannot be had ; why not, therefore, allow a copy exe- cuted by a professional sculptor, and which*, perhaps, as far as form and finish go, might be as good as the original, to enter at 10 percent, duty, or the same as all works of art? Would not a fine copy of Canova’s group of Love and Psyche, executed by a noted sculptor, be termed “Love and Psyche, after Canova,” and would it not be a work of art? A copy of a painting pays the same rate of duty as the original. It requires an artist to paint a picture, and it requires an artist to -paint a copy. So it is with statuary. It requires a modeler and a sculptor to execute an original statue, and it requires a sculptor to make a copy. I think Congress intended that all statues in marble and stone should enter at the same rate of duty. But while this sudden, stringent law was construed so as to make all foreign artists pay a duty of 10 and 50 per cent., the department has decided that an American artist can make a model of a figure or group in clay, send it, for instance, to Italy, and get an Italian sculptor to cut in marble from that model a statue, and have it brought here and passed through the custom-house /m? of duty, as the American’s professional production, although it has been cut from foreign marble, in a foreign land, and by a foreign sculptor $ while if, on the contrary, the same Italian artist, who cut the statue in marble for the American artist, makes a model himself and cuts it in marble, he, the Italian sculptor, will have to pay 10 per cent, duty, provided the department is satisfied the statue is an original ; if not, it will pay 50 per cent. I believe the law also allows American artists to send models abroad to be cast in bronze and enter here free of duty, while we, as American importers, would have to pay 35 per cent. duty. If we, as American importers of statuary, send an order to an Italian sculptor for a statue in marble, we would have to pay 10 per cent, or 50 per cent, duty, according to the decision of the department, while American artists can have their statues cut and pay no duty to the government at all. There is no objection to the American artist send- ing his model to a foreigner to get it cut in marble, if he chooses to do so, but let him pay the same rate of duty as other dealers do ; for the artist who makes a model and gets it cut in marble to sell, and not for the love of art alone, is certainly carrying on a business precisely the same as American importers who bring from France and Italy their statues for sale, and are matters of commerce. ALpXZO M. VITI.l STATUARY. 337 Therefore, the present law causes differential duties to exist between American citizens, namely, between the American artist who may have statues carved by a foreigner and the American importer who may im- port from the same foreigner. The decision is also in violation of exist- ing treaties with foreign nations, for those treaties award foreigners the right to enter their products on the same footing as Americans. To make the matter more clear to you, and if I am correct regarding the present law, I will state that, suppose A, who is an American artist, can make a model in this country and send it to B, a sculptor in Italy, to be cut in marble for a certain price. How B, the Italian sculptor, cuts the figure in marble for the American artist. In the meantime B, the Italian sculptor, makes in marble a statue from the model of some Ital- ian sculptor for his own account. We will suppose that B, the Italian sculptor, ships both statues to the United States on the same vessel, viz, the statue he cut for the American artist and the statue he cut for himself. When these two statues arrive here, the one cut for the Ameri- can artist is admitted free of duty as the professional production of the American artist A; but the statue of B, the Italian sculptor, is taxed 50 per cent. duty. I here ask why does the department demand 50 per cent, duty from an Italian or other foreign artist in marble, and allow a copy of an American model made by this same foreign sculptor to come in free of duty, when the foreign sculptor is entitled by existing treaty to enter his property under the same privileges as the American? You may say, gentlemen, that Congress, many years ago, allowed American artists to enter their productions free of duty. That was done by Congress with the understanding that the American artist should reside abroad, and there make his models and cut his statues. At that time the law admitted all statues at 10 per cent, duty 5 consequently it made no difference, as copies as well as originals paid 10 per cent. But lately the words “residing abroad” have been stricken out, thus allow- ing an American artist to make his models here, and then send them to some foreign artist to be cut in marble and brought back here as his professional production. I say, gentlemen, that such laws are more for the encouragement of sham art than for real art. Under the decision of the department, I am under the impression that not only statues can be imported free of duty as productions of Ameri- can artists, but also parts of monuments to which these statues may belong as forming a part, and upon which we, as American importers, would have to pay 50 per cent, duty if we imported them from the same country. I think, gentlemen, that the present law should be changed. I would much prefer to see statuary on the free list. But if that is not advisa- ble, then put a duty of 10 per cent, on all statues, groups, busts, ani- mals, basso and alto relievos, carved from marble, alabaster, or other stone or wood; strike out the clause allowing American artists to im port statues cut by foreigners free of duty; and then the law will be plain and equal for all dealers in statuary, whether foreign or native, There will be no further need for consular certificates declaring that this and that piece of statuary is the professional production of such or such an artist, and it would avoid all the present existing trouble as to whether the statue is original or a copy; for, under the present law, how are appraisers at the custom-house able to decide if a statue is an original or a copy, unless it be of a subject known all over the world? H. Mis. G 22 o 338 TARIFF COMMISSION. [ william b. higbie. WILLIAM S. HIGBIE. Long Branch, 1ST. J., August 3, 1882. Mr. William S. Higbie, of New York, representing the silk hat industry, appeared before the Commission and made the following state- ment: Mr. President and Gentlemen of the Commission: I represent the silk hat manufacturing industry of New York. Having been in that business for the past 27 years, I know something of its vicissitudes. We claim that the duty on hatter’s plush is excessive, insomuch that it discriminates against us. The article cannot be manufactured in this market. It has been tried. Skill and capital have been invested, but it cannot be produced. The article will not stand the intense heat to which it is subjected in this country. We claim that the foreign manu- factured article coming into this country at a duty of GO per cent, in- volves a discrimination against us. Previous to 1861 the duty was 19 per cent., but during the war it was raised from 30 to 50 per cent., and under what they call the u little tariff bill” it was in 1875 raised to 60 per cent. That was the last straw that broke our back. I will give you a few statistics of the average run of our business. Previous to 1860 the association numbered 604 members. During the war a great many of them entered the service, and that reduced the Humber probably one half. In 1865, with the return of peace, our membership increased to 684 in number. From that time it has steadily decreased, until in 1882 it is but 327 — a decrease of 48 per cent, in the membership of the association. In the face of these figures, considering the increase in population, we think we are a diminishing industry, and we attribute it to nothing else than the action of the government in imposing heavy duties through a misconception of the facts and through these ambiguities in the law. At one time, in 1872, we had 106 manufactories in New York alone, but at present there are but 42. By Commissioner Garland: Question. Is the manufacture carried on anywhere else than in New York? — Answer. Oh, yes; in the principal cities of the Union. Q. What is the difference in wages between the time when you had 106 manufactories and at present? — A. The rates are about 25 per cent, and in some cases 50 per cent, less at present. CHARLES BBYCE.] GOLD LEAF. 339 CHARLES BRYCE. Long Branch, N. J., August 4, 1882. Mr. Charles Bryce, of New York, representing the Gold Beaters’ Union, appeared before the Commission and made the following state- ment : Mr. President and Gentlemen of the Tariff Commission: The gentlemen present with me are a committee appointed to represent the journeymen gold-beaters of the United States. Our object is to present to you the condition of our trade, and to show the necessity for an increase in the present tariff on gold-leaf. Under the existing tariff we are obliged to accept wages fully 25 per cent, below the average paid to other skilled mechanics and artisans. There is a great deal of brain-work in connection with our business. Vv^e require no compass or plumb. It requires a number of years to become suffi- ciently skillful to earn fair wages. The business is subject to many un- favorable influences, such as changes of the weather, &c., and we have to study the results. The tools we use are very sensitive, and it re- quires great care in order to produce gold-leaf satisfactory to the con- sumers in this country to-day. At the preseut rate of duty we do not see the slightest chance of bettering our condition, and as the duty is now $1.50 per pack we respectfully ask that you recommend that it should be raised to $2.50 per package of 500 leaves. About four months ago we were receiving about 18 per cent, above what we now receive, but our employers showed us quotations of for- eign leaf, proving that they could import it at lower rates than it could be made for here, and in order to compete with it we were obliged to accept the present rate of wages. As artisans we have to use a degree of intelligence above the average of other mechanics. We present the estimated wages earned at other branches of industry, those who are, like us, employed in cities : Per annum. Bricklayers $600 Painters 550 Carpenters 550 Gold-beaters 432 The average wages of the women employed at our trade is $234 per an- num. Gold leaf is not an article of absolute necessity, although it is ex- tensively used, but may be regarded more as an article of luxury, and should, injustice, be placed in a list where a consumer whose means enable him to enjoy luxuries should be required to pay a duty adequate to protect labor in this country from the effects of ruinous foreign competition. In conclusion, we thank the Commission for the courtesy shown us in our endeavor to preseut our case, and we earnestly hope for favorable consideration. I will state in addition that quotations have recently been received from Germany, from which it would appear that 'gold-leaf can be deliv- ered in this market at $G.42 per pack of 500 leaves, while it costs our manufacturers here to produce it in the same condition $6.45. So you see, gentlemen, that we dare not move to get an increase of wages, be- cause the moment we do we throw the market open to loreign importa- 340 TARIFF COMMISSION. [CHARLES BRYCE, v tion. We think that if we could get an increase in the duty from $1.50 to $2.50 per pack, we might hereafter induce our employers to give us an advance of wages, whereby we could calculate on an average com- pensation of $675 to $700 per annum. But under existing circumstances there is no possibility of getting any advance. We have tried to occupy as brief a time as possible. It is a matter that our brothers throughout the United States are deeply interested in and have taken action upon, and Mr. Hickson, Mr. Ames, and myself were appointed a committee to wait upon you to represent the interests of the gold-beaters of the United States. By Commissioner Underwood : Question. I would like to know about how many people in the United States are engaged in this business ? — Answer. To-day there are about 1,200 people — men, boys, and women. They are employed in Cincin- nati, Philadelphia, Boston, San Francisco, Yew York, Hartford, Conn., and other places that I cannot remember just at present. It is a great hardship on men with families, to have to work for the wages we get, for it is an impossibility to pay an advance rent and have anything left with which to live half decently. We dare not demand any advance, because the moment we make a fight, we know there is nothing left our employers but to import. By Commissioner Kenner : Q. The principal expense attending your business is labor, judging from your remarks 0 ? — A. Labor and the tools. Q. But the principal expense is the labor, and in protecting it you jn’otect it more than you do the capital ? — A. Yes ; that is the principal object at present, and if we could get this increase, which I respectfully ask you gentlemen to recommend, it would be of great benefit to us. By the President : Q. Who are your employers — are they manufacturers ? — A. They are manufacturers. They are gentlemen who have served their time, nearly all of them, at the business. By Commissioner Garland : Q. The duty is now $ 1 .50 per pack of 500 leaves, and you ask an increase of how much 0 ? — A. One dollar more, making $2.50 per pack. Mr. Tho3IAS Hickson, another member of the committee of the Gold Beaters’ Union, also addressed the Commission as follows : One of the gentlemen asked my colleague (Mr. Bryce) a question as to whether the labor or the gold was the principal part of the expense. I believe Mr. Bryce misunderstood the question. The gold itself is by far the largest proportion of the expense. The gold is worth $4.25, and the leaf as it is imported is imported at an advance of about 80 or 90 cents for labor. Here it costs $1.25 for labor.. You can see, gentlemen, that no mechanic can live on an average wages of $432 a year. We ask that the duty may be increased, so that we may get at least as much as other mechanics do, and that is all that we can expect, of course. We think we are entitled to more, but that is all we ask. Commissioner Kenner. The purport of my question was whether the interest to be protected was the money invested in the plant or the labor of the people of the country. Mr. Hickson. It is the labor of the people of the country. WM. A. A. CAR8EY. ] LABOR. 341 WILLIAM A, A. CARSEY. Lono Branch, N. J., August 4, 1882. Mr. William A. A. Oarsey, builder, of New York, and representing the Laborers’ Union, appeared before the Commission, and made the fol- lowing statement : Mr. President and Members oe the Tariff Commission : Gentlemen : I appear before you as a representative of that large class of workingmen who, after a long and bitter experience of the folly or inability of the non-political striking labor union system to obtain the rights or better the condition of the worker, have directed our eiforts and energies to the education of the working classes in the use of the ballot as a cure for the evils of our labor system, its power to remove the cause, as well as cure the effect, and to the discussion of all ques- tions, political, social, and economic, that affect their interests (such as the tariff, the question of all questions to American labor), prior to their peaceful, intelligent, and just settlement by that great power and priv- ilege we possess over the workingmen of all other civilized or uncivilized countries — the ballot. The Independent Labor Party of New York, to which I have the honor to belong, was organized in the year 1874, pursuant to a resolution adopted by the State Trade Assembly at their annual convention of that year, ihat political action was necessary to the salvation of the working classes, and from that time to this we have steadily and persistently labored to that end. We had the pleasure in that line of policy of ap- pearing before the Labor Commission and presenting our views on the labor problem. We also take great pleasure in appearing before your committee to present our side of this great question, and we hope that the wise and unprecedented statesmanship that devised or adopted this new method of solving a problem upon a basis of knowledge that first seeks out the facts as a guide to intelligent action, and that comes to the people to learn their wants and listen to their suggestions on questions of legislation, will not only lead to wise and just action, but act as a great precedent for all future legislation, and will give to our people not alone wise laws, but a truly representative government of the people, by the people, and for the people. As American citizens our interests are bound up in the preservation and perpetuation of our free government and its institutions, as well as in the material prosperity and contentment of our working people, and we appear before you to advocate a broad and liberal policy in the in- terest of all classes ; not one to foster or oppress a special class or spe- cial interests, but one that will foster and protect and build up our in- dustries, develop our resources, perpetuate our institutions, and make us a wealthy, prosperous, self-supporting nation, with ahappy, contented, enlightened, and industrious people; a policy that will foster and develop our system of free schools, free press, free church, and a free ballot, as well as decent homes and well-clad, well-fed people, for upon the material prosperity of our working-people depend not alone the comfort and pros- 342 TARIFF COMMISSION. [WM. A. A. CAUSEY. perity of our great middle and professional classes, but our system of government, our institutions, and the liberties of our whole people. In the interest of all classes we ask for a policy which will protect our own industries, develop, occupy, and fill our home market, foster domestic exchange, shipping, trade, and transportation, to the exclu- sion of all foreign, hostile, competitive interests, and we deprecate and oppose a policy that, under a mask of love of liberty, philanthropy, and humanity, strives to benefit and enrich a few foreign and native ex- changers, and foreign sliip-builders and manufacturers, at the expense of our own people, and at the cost of the loss of our shipping and manu- facturing industries, with its results — the poverty, idleness, and degra- dation of the American workman ; a policy that, by draining our country of its natural wealth, wheat, gold, and other raw material, destroys our own industries, makes us poor and dependent, and if we are to believe the New York city press of to-day, threatens us, in the midst of peace, plenty, and prosperity, with another panic. In the last two weeks the New York press has been filled with statements that the loss of $20,000,000 or $30,000,000 of gold exported to Europe will bring on another panic. Let me call the attention of the Commission to a few facts (not ideas or theories), on which we ask you to base your report. 1st. That we are a rich, prosperous, and self-supporting nation, pos- sessed of all the soil, climate, and natural wealth required for the use and sustenance of all our people ; that we are or could be perfectly in- dependent of all foreign exchange of goods, food, or money, and that our present exchange between the United States and Europe is at the cost and loss of the American people. 2d. That to develop our own resources, make our o^n exchanges, and fill our own markets, would employ all the energies of our people, and would be a better and more profitable trade than. that with pauper nations. 3d. That to eat our own food and manufacture our own goods at any standard of cost or rate of exchange is a wiser and better policy than to employ others to make our goods and eat our food for us, unless we wish to build up an idle aristocracy, with an idle, pauper people. 4th. That the cheapest, best, and fairest exchange of commodities is that which is the nearest and most direct between the producer and consumer ; and, to quote Andrew Jackson, u True statesmanship will place side by side the farm and workshop.” You, gentlemen, are aware that we now make our wooden pails in the woods and send them to New York. The iron manufacturer is going where the ore is. That is the natural logic of events and cannot be stopped. The manufactories must go where the raw material is. I will add, if wise statesmanship will not do so, the logic of events, the bitter war of competition, will do so in the end. 5th. That if exchange with foreign nations is to be our policy, or a necessity, it should be carried on by means of American ships maimed by American seamen, so that the profit of such trade would inure to our own people. 6th. As American labor, owing to various causes, requires and de- mands a higher wage to supply its wants, needs, or luxuries — that is, to own a decent house, read books and papers, pay pew rent and doc- tor’s bills, send his children to school, and buy good clothing for himself and family — the American manufacturer must pay 100 per cent, higher wages than his foreign competitor, as well as higher taxes and rate ot interest. It is a self-evident truth that we must have a tariff of at least 100 per cent, to allow us to compete with foreign manufacturers, or’ WM. A. A. CARSEY.] LABOR. 343 cease to manufacture goods for a competitive market, or else reduce the American to the wage and (its result) the condition of Europeans, or import the pauper laborer to take the place of the American laborer. Therefore, we ask of your Commission — 1st. A tariff on all goods or materials that can be made or produced in this country, not as a means of revenue, but as a policy to protect and employ American labor and develop the resources of the nation, and higli enough to allow a fair profit to the American manufacturer and producer on his capital invested, after paying as high a wage as is required to keep up to a high standard the American laborer. 2d. We favor a liberal policy to develop our own merchant marine. 3d. We oppose the importation of cheap labor as an injury to both employer and workman, and an injury and danger to our government and our institutions. While you are so close to the city of New York, I would suggest that it would be wise for you to pay a visit to Castle Garden and see the character of people brought here with these ideas in their heads, to strike and do nothing but strike. You should also visit the tenement houses on the east side and west side of the city, and see the condition of the working classes there, and then consider whether it is wise to continue to do anything to add to that condition of things in this country. We limit our demands to these three propositions, as we know your Commission is confined in its powers and limited in its report upon this question, and prefer not to embarrass you by demands outside of the limits set you by present conditions in the discussion of the question. We might suggest to your consideration the encouragement of such industries as the culture of silk, to furnish employment to girls and women at their homes, and arbitration and co-operation as a remedy for strikes and labor agitation. We try to be practical, fair, and just, and ask only for what is ad- mitted to be necessary for our own protection by all fair-minded men, and we appeal to you as just and honest men tp give to us this relief, which will not affect or alter, or threaten to overthrow any class or sys- tem, and we will willingly abide by its results, and trust to time and education to alter and amend other evils of our condition. Refuse us this protection, flood the country with cheap goods and cheap labor, and the result will be a war of classes, strikes, riots, and armed rebellion. It is a self-evident fact that men like myself will not submit to be re- duced to the condition of people on the other side of the water. We have been spoiled by the public schools, free press, and the political system of the country, and when we are driven too far, we may just as readily take up our muskets as we did in 1861 for the defense of the country. I have been president of the laborer’s union, a knight of labor, and a socialist, and I know them all thoroughly. I have come to the conclusion that the best way to settle the matter is to bring the workingmen up to the use of the ballot as a means of redress. I have led strikes in New York, and I know by bitter experience that that is a mistake. The leaders of strikes simply drag the workingmen into iso- lated associations that make war upon the capitalist, and the result is that the capitalist makes war upon them. There are a great many men like me in New York who think as 1 do, but who have not the moral courage to express themselves and break loose from their old associa- tions. By the President : Question. Do you represent an organization ? — Answer. Yes, sir. 344 TARIFF COMMISSION. [WM. A. A. CAUSEY. Q. What is its character ? — A. It is composed of the leading trades unions in New York, and we are trying to organize the workingmen politically. We have got in our ranks the presidents of fifteen or twenty organizations. Those men have all learned by experience that this is the only way we can settle these questions, and while I still belong to the Bricklayer’s Union, and work with them as far as I can, I keep telling them that they will find out that they will have to go with us. By Commissioner Garland: Q. Has your organization representatives in all the cities? — A. It has representation all through the State and all through the city of New York, and attempts are making all over the United States to organize. The New York men to-day are in a chaotic condition between the trades- union system and the political system. Most of them are aiming at the same thing, but have not yet come together. Many are Greenback- ers, many are Socialists, but in a year or two they will all be together. C.MENELAS.J JUTE. 345 C. MENELAS. Long Branch, N. J., August 4, 1882. Mr. C. Menelas, of New Orleans, appeared before the Commission and made the following statement in regard to jute: Mr. President : I have the honor to appear here, as a foreigner, to represent, as plainly and briefly as possibly, the subject of the cultiva- tion of jute in this country. I suppose you are all very familiar with the history of jute. It rep- resents an industry whose annual productive value is over $100,000,000. India alone produces the raw material. In 18(30 — I do not go beyond that period — the total export from India was 322,000 bales of 300 pounds each, of which America only took 7,000 bales. I have statistics up to 1879, and the growth has been enormous. In 1868, it was 1,000,000 bales; in 1872, 1,472,000 bales; in 1879 it was 1,600,000 bales; and by this time I suppose it is over 1,750,000 bales. Jute is exx>orted from India to Europe as well as to America. To the total export of jute to Europe you must add the enormous quantity used in India for domestic pur- poses and for the manufacture of such articles as gunny-cloth and gunny- bags, which they send to this country. The use of it in India is immense. Their saltpeter, indigo, rape-seed, and linseed, and many other articles are all more or less covered with gunny-bags or gunny -cloth, so that the total is perfectly enormous. You will perceive that it is of great importance that we should pay attention to this industry and try to introduce it into this continent, especially in the South, where the climate, soil, and everything are favorable to its growth. Last year I think we must have paid over $10,000,000 for jute imported and manufactured, and the consumption is increasing not only in Europe, but in this country as well. It enters into the manufacture of the coarsest as well as the finest fabrics. Scot- land has an increasing demand, and begins to feel anxious in regard to the production of jute, and two or three years ago a company was formed in Dundee for the sole object of sending men to Egypt to try and intro- duce the cultivation of jute there. They succeeded in the production of jute, and sent a few bales of it to Dundee, where it was pronounced excellent. But still they have not there the facility for its production that we have here. As to the growth of jute in this country opinion is divided. Some think it can be grown profitably, and some think it cannot. Professor Waterhouse, of Saint Louis, Mo., has expressed a favorable opinion as to the desirability of jute culture in the South ; and another gentleman, Mr. McAllister, who went to Florida and Louisiana, has expressed the opinion that that industry should be introduced in this country, because everything is favorable. To those statements I have to add, in a few words, my own experience. In 1878 I bought a plantation in Mississippi, and concluded to make an experiment in jute culture. I wrote to the Agricultural Department at Washington about it, and planted one-eiglith of an acre. The land upon which I planted was alluvial, such as is used for corn and cotton. To 346 TARIFF COMMISSION. [C. MENEL\S. my surprise, I saw that crop grow magnificently to perfection. I took some stalks to the Cotton Exchange, in New Orleans, which measured 15 feet high. I induced the commissioner of agriculture of Louisiana and other friends of mine to plant several acres, and I have been through their plantations, and it seems to grow admirably. So there is not the slightest doubt that jute will grow splendidly. I will now show you some samples of jute that I raised on my plan- tation the past year. The first sample I show you is one I had at the exposition at Atlanta, where I submitted it for inspection to Mr. Sloan, a manufacturer, and to others who were dealing in jute. They exam- ined it very carefully, and, except that it was gummy in some places, they said they had not seen anything better, and they told me further that they were prepared to pay as high a price, if it was brought into market, as they paid for jute brought from India. This was prepared in the old style, which is certainly very expensive. We cannot compete with India, where labor is very cheap, so long as the present rate of duty is in force. For 15 cents a day in India you can hire a man to work for 8 or 9 or 10 hours. The object is to find ma- chinery to decorticate the stalk, and there is very little doubt but that we can get it. A gentleman has patented a machine, which has been ex- amined at Washington, and the agricultural papers have a great deal to say on the subject. The patentees are extremely sanguine of success. They tried it at West Point, Virginia, last year, and although the jute was very short and hard in consequence of the extreme drought that had prevailed, still the machine did the work splendidly ; so much so that this year they have offered to contract with farmers to buy their production in a green condition upon their own account. They have a factory built and are ready to do the work. They have about 600 or 700 acres planted this year, in North Carolina and Virginia, and they are very sanguine. I received a letter from Saint Louis yesterday transmitting three samples. Of course this is in a very raw condition, the plant not being ripe yet [exhibiting the samples to the Commission]. In regard to the machine mentioned, I will read from a newspaper slip the following : The Dejjartment of Agriculture has received a magnificent sample of American jute fiber, prepared by a mechanical process from green stems grown in Virginia. It satis- factorily solves the problem that has engaged the attention of the department for ten years, and establishes the fact that India jute can be successfully and profitably grown on American soil. In the language of the Commissioner, “ It is a declaration of our independence from India in the matter of jute, and makes an annual saving to this country of over $10, 000, 000. ” The prepared fiber now on exhibition at the department is pronounced equal in any respect to the foreign fiber, and superior in strength to India fiber. The plant can be successfully grown in any section of the country, "and it is believed farther to the north. A machine has recently been invented in this country for cleaning and preparing the fibers for the market. The inventors intend to operate the machine this season on the James River. The department is distributing a large amount of jute-seed throughout the Southern States. The yield of fiber is about 3,500 pounds to the acre, and the market quotation for the prepared article is 12£ cents per pound. For years jute has been to India a great source of wealth, and there is no reason why it should not be an equal source ol wealth to the United States. After it passes tliis preparatory process tbe jute goes through a chemi- cal process, which produces the whiter article which I now exhibit to you, and this is the finest article I have seen, and will come into immense con- sumption, even in competition with silk fabrics. The extra expense of putting it into this condition will be from 1^ to cents a pound, but once in the market, I believe it will sell for 4 or 5 cents a pound. It may be that this fall we shall find some defects in the working machinery, but, C. MENELAS. ] JUTE. 347 gentlemen, I think injustice will be done to the inventive genius of our people to doubt for a moment that the difficulty will not be remedied. I believe that the question is settled already. The moment the culture of jute is started in the South, then there will be no end to its cultivation, because it is an article that requires very little labor. In four months it grows from the seed to fiber, afterwards it attains such growth that it chokes out the weeds, and then it will take care of itself. After it attains a height of six to twelve inches it grows so rapidly that it kills every other vegetable. It has no enemies, such as insects and worms. I re- member last year, when the drought was so terrible in its effects upon almost everything else, the jute on our plantation was fresh and green. This subject is one of great importance, and I have no doubt will com- mend itself to your consideration. By Commissioner Kenner : Question. You are the pioneer cultivator of jute in the United States, are you not ? — Answer. Jute was raised in this country fifteen or twenty years ago, while I was in India, where I spent ten years. It was not cultivated successfully the first year, and after that it was abandoned. We hope for better results this time. Q. During the ten years you were in India, I presume you saw a great deal of jute cultivation ? — A. Yes; I handled a great deal of jute. Q. And you think that which you raised in Mississippi was equal to any you ever saw in India ? — A. Most undoubtedly ; and I do not hesi- tate to say that in a few years we shall produce here, with intelligent labor, much better jute than India produces. Q. The labor required to produce jute as a cultivated plant is very small, I understand? — A. Extremely small — smaller than for any of the usual crops. The first labor is to plant; there is very little to do after that. Q. Preparing the jute for market requires labor, but you think that will be supplanted to a great extent by the machines to which you have referred ? — A. I have not the slightest doubt of it. The cotton-gin was the offspring of necessity, and some machinery for this purpose will surely be invented. The genius of our country men will come to the res- cue as soon as they see the need of machinery. By Commissioner Garland: Q. Did I understand you to say that jute could be grown successfully in Virginia and West Virginia? — A. Near West Point, Virginia, they have tried it. I believe jute can be raised in Virginia in all the alluvial bottoms. It requires good soil. Q. What amount per acre can be raised? — A. That is a question which will be answered by practical results soon, but I do not hesitate to say that the minimum will be 1,200 to 1,500 pounds of fiber to the acre, and with intelligent labor, we may increase that amount greatly ; I could not venture to say how much. This sample which I now hold in my hand represents the product of seven stalks only, which I cut myself, washed, and then took to the exposition. So you can imagine the enormous yield we will have per acre when it is properly cultivated. Q. Does frost affect it in its early growth? — A. Yes, I think it does. In the South we always try to have our ground ready and plant it as early as possible — usually the first week in April. By Commissioner Underwood: Q. What amount of duty would you recommend to be placed on the manufactured article and upon the raw material? — A. I am not familiar with the duty on the manufactured article. 1 believe it is about $0 a ton 348 TARIFF COMMISSION. [C. MEXJSLA8. on the butts, and about $20 a ton on the jute. I think that if the duty remains as it is, it will be enough for us to start with. By Commissioner Kenner: Q. You have mentioned that the jute you cultivated was free from the inroads of all kinds of insects. Have you ever heard that jute planted in a cotton field will prevent the inroads of the cotton worm, so de- structive to Southern crops? — A. Yes, but I have never made the ex- periment myself, though I have read that in books, especially those em- anating from the Department of Agriculture, and in the writings of such authorities as Professor Waterhouse, of Saint Louis. I am sorry to say I never tried the experiment myself, but the fact that no insect comes near it I think shows that it may do a great deal of good. O. B. SMITH.] PATNTS AND OILS. 349 O. B. SMITH. Long Branch, N. J., August 4, 1882. Mr. O. B. Smith, of the firm of J. Lee Smith & Co., of New York, appeared before the Commission, and made the following statement : Gentlemen of the Tariff Commission: There are few, if any, staple goods of universal use that are so highly taxed by the present tariff as paints. Comprising as they do articles of necessity to every property-holder in the United States, it would seem as if the burden- some duties now levied upon them should be lessened and many of the prohibitory ones be done away with entirely, or at least placed upon a footing which would bring them within the reach of our manufacturers and consumers. Among the many articles that are comprised under this head I would instance a few cases of such flagrant overtaxation, to which I invite your attention. The most important pigment in the paint list is the article of white lead, which, under the present tariff, is taxed 3 cents per pound duty. This article we purchase in England, at a cost of 20s. 4 d. net, packages included, which is equivalent to $4.95 per 112 pounds, or a cost per pound of 4.42 cents, which the English manufacturer receives, against a simi- lar article made in this country, for which the American manufacturer receives 7 cents per pound. The duty on this quantity is 3.36 per cent., giving the American manufacturer a protection of 67.87 per cent. Were it not for this exorbitant duty we could sell this article, with shipping expenses included, at a cost to the consumer of cents per pound. The difference of 1^ cents per pound is what is paid by the consumers in this country on an estimated consumption of 55,000 tons per annum. As a proof that this duty is almost prohibitive, I will state that there was imported for the eleven months ending with May 31, 1882, only 931 tons of English white lead, both dry and in oil, into this country, the value of which was $116,975. It would seem that, taking into consideration the enormous quantity of pig lead produced in this country, and with the best facilities for the manufacture of white lead, that the American manufacturers should be content with a smaller profit than they are realizing at preseut, and I should therefore suggest a rate of duty not exceeding 1J cents per pound, which, adding the cost of freight charges, &c., would be ample protection upon such a neces- sary article. The pigment known as red lead costs in England 16s. Id. net, pack- ages included, equivalent to $3.91 per 112 pounds, or 3.49 cents per pound. Upon this quantity the duty is $3.36, which makes a protection of 85.94 per cent. For the American manufacture of this article 6£ cents per pound is demanded. It is very extensively used in the manu- facture of glassware, for which our manufacturers are endeavoring to find an export outlet, but the difference in t»lie price they are forced to pay for the American product seriously hampers them in competing with the foreign market, as well as for our home trade in fine glassware, which has to be made from a certain production of red lead made only in England. Combined with the importation of litharge, which two pigments are classed together, the total imports for the eleven months 350 TARIFF COMMISSION. [O. B. SMITH. ending May 21, 1882, amount to only 255 tons, of tlie value of $25,079. This article is also very extensively used for the preservation of iron- work, iron vessels’ bottoms, tin roofs, &c. We claim that the duty on this article should not exceed 25 per cent, ad valorem. Litharge is used largely by glass and rubber manufacturers. It costs in England 17s. 7 cl. per 112 pounds net, packages included, equiv- alent to 3.81 cents per pound, on which the duty is 3.36, or a protection of 78.69 per cent, to the American manufacturer. The market price of this product is 6 cents per pound. We would suggest the duty on this be placed at 25 per cent., as it is used almost entirely by manufacturing interests. Paris white is made from English cliffstone, which is admitted free of duty. It costs in England 36s. per ton, or 39 cents per 100 pounds, the duty on which is $1 per 100 pounds, or a protection of 256 per cent. It is used very largely by manufacturers of wall-paper, oil-cloths, in whiten- ing ceilings, &c. The consumption of Paris white amounts to many thou- sand tons per annum. The quantity imported for the eleven months named, including whiting, amounted to only 1,619 tons, of the value of $14,146, on which the government received in duty $36,249.25. As the article of cliffstone, from which this is manufactured, is not found in this country, and the manufacture of it here employs but very few people, we would suggest that the duty be fixed at not over 25 per cent. Wbiting costs in England 20s. per ton, or 21 cents per 100 pounds, the duty on which is 1 cent per pound, or a protection of 476 per cent. It is an article of almost universal consumption, being used extensively by the wall-paper manufacturers, in the manufacture of putty, oil-cloths, and a variety of manufactures. It is made from English cnalk, a sub- stance which is not found in this country, and admitted free of duty. We are not aware of any having been imported for some time, although as the articles of Paris white and whiting are classed together in statis- tics, being very similar, it is difficult to state positively. We would sug- gest that the duty be fixed at 25 per cent. China clay costs in England 21s. per ton, equivalent to $6.56, on which the duty is $5 per ton, or a protection of 76 per cent. It is used by china and porcelain manufacturers, also largely by the paper manufacturers. There are no corresponding grades of china clay found in this country to answer the purpose for which the English china clay is used, and the difference in cost to the china and porcelain manufacturers in this country and those in foreign countries is so great as to place our manu- facturers upon a very unequal footing with their foreign conrpetitors. The preparation of china clay consumes but very little labor, and is therefore of a trifling benefit to the American laborer, whilst our large China and paper manufacturers are forced to pay an unnecessarily high price for their raw material or use the poorer qualities found in this country, which produce a much inferior manufacture of china and paper. We suggest that a duty of 25 per cent., to which^should be added the heavy freights and expenses attendant upon the importation of such a bulky merchandise, would be ample protection for the few persons en- gaged in its production in this country. Linseed oil is worth in England, at present, £25 per ton, equivalent to 40 cefits per gallon, the duty on which is 30 cents, or a protection of 75 per cent. This article is often advanced by speculation and temporary causes to an artificial value, which the consumers are obliged to pay, as the prohibitive duty prevents the importation of the foreign oil which would correct the market. We would suggest that a duty of 15 cents per gallon would be ample protectiflfi to the manufacturers in this country, O. B. SMITH.] PAINTS AND OILS. 351 as, for instance, at the present time the oil is worth in this market 52 cents per gallon, upon which it is supposed they are making a fair profit, and should the price be raised the oil could be landed here for 55 cents per gallon to serve the purpose mentioned betore. By Commissioner Ambler : Question. What is the average price of it? — Answer. The price in August last was 49 cents a gallon. Since that it has been up as high as 05. We bought in July last at 42 cents, and resold it two months afterwards at 52 cents. When there is a little scarcity it will put up the price sometimes as much as 20 cents a gallon, but the duty of 30 cents is so great that we cannot bring in foreign oil. The price ranges in England from 40 to 55 cents a gallon. If they put up the prices to a speculative degree, we could bring in foreign oil. Linseed oil is an article of immense consumption in the oil-cloth trade alone. It is about the most important article which we have, next to petroleum. Venetian red is produced almost entirely in England, and is admitted at a duty of 25 per cent. It is a paint of the most common use, required by all classes of people who use paint at all. There is scarcely a farmer in any section of the country who does not use more or less of it to paint his house, barns, fences, &c. The consumption of it is about 20,000 barrels per annum. We know of only two manufacturers in this coun- try, who produce but a small proportion of the total amount. W r e would suggest, under these circumstances, that it be admitted free of duty. Ochers and ochery earths are taxed at the rate of one-half cent per pound, and are among the most largely used of any class of paints. The qualities found in this country are very poor, and are unsuitable for the uses to which the foreign ochers are put. The low grades found here are used almost entirely by the oil-cloth manufacturers, and are produced so cheaply that no foreign ocher, if admitted free of duty, with heavy expenses upon them for shipping, &c., could compete with it in price. We should, therefore, suggest that they be put on the free list, as they are articles of necessity to the manufacturers and consumers alike. The foregoingare but a few instances of the exorbitant rates of duty charged upon this class of goods, and as fully 75 per cent, of jmints and colors are used for the preservation of wood and iron work, principally in the country, it would seem as if the whole list should be admitted at a low rate of duty, which, in few cases if any, should exceed 25 per cent. We would also call your attention to section 2499 of the Revised Stat- utes of the United States, which has caused much trouble in our partic- ular line of goods. It provides that the duty shall be paid on any non- enumerated article which bears similitude either in material, quality, texture, or the use to which it may be applied, to any article enumerated in this title as chargeable with duty, the same rate of duty which is levied and charged on the enumerated article which it most resembles in any of the above particulars before mentioned, &c. We would rec- ommend that this section be repealed, as it gives rise to endless litiga- tion. By Commissioner Ambler : Q. What would you recommend as a substitute? The mere repeal of the similitude section would perhaps be hardly fair without some other provision in its place. — A. It is easy to make a list from the sta- tistics in the custom-house of these articles in the different lines of busi- ness that are imported, and all that are imported should be put down at a certain rate of duty ; and any article in that line unenumerated could be charged 50 to 75 per cent, ad valorem. 352 TARIFF COMMISSION. [O. B. SMITH. By Commissioner McMahon : Q. You would make a general clause to cover all unenumerated arti- cles, and make that clause specific in its rates'? — A. Yes ; but I would enumerate everything almost that is imported. The article of whiting is taxed 1 cent a pound duty. It is nothing more nor less than chalk ground up and floated off in water and settled in a tub. That in the first tub will be sand, and in the next tub whiting. Any one would see, in following out the line of that manufacture, that it is nothing but pre- pared chalk. That would be plain, and yet prepared chalk is especially enumerated in the tariff at 25 per cent, duty, which would be about £ of a cent a pound, whereas whiting, which is prepared chalk, is charged a cent a pound. During this year a party found some cliff-stone that required no washing. It was brought into this country, and they have been unable to find out whether that article, as imported, is chalk, pre- pared chalk, whiting, or Paris white. If I take the two articles of Paris white and whiting I don’t suppose one gentleman in a thousand could tell the difference. By Commissioner Asibler. Q. There is, however, a commercial difference? — A. Yes, there is; but it is left a good deal to the honor of the seller. -In this case I un- derstand, Appraiser Howard asked him what he did with this article claimed as prepared chalk. He answered that he sold it. He was asked what for, and answered, “ I sold it for Paris white.” That was in favor of the government. But still, it is a very close question whether it was whiting, Paris white, or prepared chalk. And there are those two items there which are really one and the same thing, assessed at J of a cent a pound duty in the one case, and at 1 cent a pound in the other. By Commissioner McMahon. Q. Do you mean to say there is a commercial distinction without a commercial difference? — A. Of course an expert could tell the difference; but it would be only by the superior whiteness of the one article, or by its toughness, and an ordinary person would not be able to tell the dif- ference. Under this section, 2499, orange mineral was charged' a rate of duty of 3 cents per pound. Q. That was by decision. — A. We paid that duty, I suppose, for twenty years, because they said that it most resembles red lead, and under this section we must pay 3 cents a pound. So we paid that duty, I think, for twenty years, and the matter finally came up in suit, and the court decided that it should pay 25 per cent, as a u painter’s color not other- wise provided for.” And we got back under that decision some $2,800. Also section Yo. 2907, which provides for an Additional 2£ per cent, to to be added to the market value of the goods, should be repealed, as it is a petty extortion on the part of the government, and an addition to the duties levied by law, for which there seems to be no right or justice. They add 2£ per cent, to the invoice value, and you have to pay the ad valorem duty in addition, which gives rise to much trouble and loss to to the merchant, and seems to be unjust. By Commissioner Oliver : Q. Would you recommend a specific duty instead of ad valorem ? — A. I would recommend specific duty in all cases where possible. By Commissioner McMahon : Q. Are these staple articles ? — A. Yes, sir. 0. B. SMITH.] PAINTS AND OILS. 353 By Commissioner Oliver : Q. Would it be practicable, and work easily, to assess them by the pound or gallon ? — A. To assess them specifically would be very much better. Q. Then, as I understand you, as a general principle, you are in favor of specific duties, and not ad valorem t — A. Yes ; decidedly. We would also respectfully urge the adoption of the suggestion made by the Assistant Secretary of the Treasury, Hon. H. F. French, a few days since, that a special court of claims be established to have the sole consideration of revenue cases, as the present mode of settling such dis- putes gives rise to much trouble, delay, and expense to the merchant. As an example of the w orking of the present system we would instance the following in our own experience. Section 2505, Article 1554 of the free-list, reads as follows, “Oolcothar, dry, or oxide of iron.” Upon an importation of ours in 1873, the collecter charged us 25 per cent, ad valorem, classifying it as u a painter’s color not otherwise pro- vided for.” Upon appeal to the Hon. Secretary, George S. Boutwell, he decided in our favor that it should be free of duty (decision 1349 of the year 1873). The matter being again agitated, the Hon. Secretary, B. H. Bristow, in a letter of instruction to the collector at Boston, August 21, 1874 (decision No. 1912), defines “colcothar as being a dry oxide of iron produced by chemical action, but not chemically pure, con- taining quantities of lime, sulphuric acid, and sulphate of lime as im- purities.” We continued to import this free until 1876, when the col- lector again charged us 25 per cent. duty. The Secretary, L. M. Mor- rill, again decided in our favor. It then rested until 1880, W'hen Sec- retary John Sherman decided it should pay duty (decision No. 4700). In the spring of 1881, the government adopted a plan of analyzing all importations of colcothar, and at first adopted the standard of 90 per cent, purity to entitle it to free entry. The result being that if it fell below this standard it was charged 25 per cent, duty, although of less commercial value than the pure oxide. As a consequence of this arbitrary ruling against the spirit and intent of the law, we have been forced to pay thousands of dollars in duty upon an article which the law declares shall be free of duty without any standard as to its purity. Since this ruling was established we have had a number of decisions upon importations, sometimes in our favor and sometimes against us, and we could never tell before the liquidation of the entry whether we would be charged duty upon it or not, which uncertainty compelled us a short time since to sue the government to have the matter finally set- tled in the courts, w hich under the present state of the calender may be deferred for perhaps two years, whereas, if we had such a court of claims as proposed, we could arrive at a settlement of the question with comparatively little delay. We had a shipment of oxide by the steamship Itoumania in April, 1881 ; part of it was put in 20 casks, and the rest of it in 50 kegs. They passed the kegs as analyzing over 90 per cent., and the 20 casks from the same pile, according to other analysis, was only 33.3 per cent, oxide. We appealed on that, and the Secretary decided that they had had it ana- lyzed by the government chemist, and we should pay duty. I wrote to the Secretary again and told him it was a mistake, and asked a recon- sideration of the matter. There it rested for tw T o or three months. lie then said they had had it re-tested and found that there was only 33.3 per cent, of oxide, and he must decide against us. I then went up to the appraiser’s office and asked them to turn up their formal sample from that shipment, which they did. They gave me part of that sam IT. Mis. G 23 354 TARIFF COMMISSION. [O. B. SMITH. pie in a sealed bottle, and I took it to a chemist and had it analyzed. The chemist found that it contained 94.G per cent, of oxide. At the same time the custom-house had it sent to their own chemist again, and he analyzed it and found it to contain 94.6 per cent. They then went back on their own sample. They said, a This sample must have got mixed somehow; that is not the same sample.” “But,” I said, “there is the bottle from the same shipment.” I told them to leave it to any good chemist, and we would pay the expense. So they gave it out to another chemist who decided with our chemist, and, after a year, we got our money back. That all consumed much time and cost much trouble. By Commissioner Oliver : Q. Your business is purely importing? — A. Yes, sir. Q. You do not manufacture? — A. No, sir. Q. Do the importers generally favor specific duties ? — A. I think so, undoubtedly. It is a very much easier way to collect duties, and it makes a regular stationary amount to be fixed upon the goods, without regard to value abroad. It is easy of calculation, aud much easier of collection. Q. Do you think it would be possible to assess the duty on the home valuation of goods? — A. I don’t think it would be; that article of white lead to day is worth 8J to 9 cents with duty on. By Commissioner Ambler : Q. Suppose you take the home valuation with duty off? — A. The home valuation here would be 7 cents; but it would be American lead; the English lead is better and would bring more money in this market. Q. The home valuation would be on the article itself without reference to whether it was American or English; that is, the appraiser would ap- praise the article presented at the market price here. If English lead was worth more it would be appraised higher. — A. Then they would have to go upon the same system here that they do in England ; that is, if a merchant is dissatisfied with an appraisement, the government will pay him 10 per cent, and take the goods. But I do not think that would hardly work in this country. Commissioner Ambler. I have heard several say the same thing ; but I have not heard a reason. If the Euglish lead is worth more, say, one-fourth of a cent a pound, of course the appraiser will put that much more on the valuation. Commissioner Oliver. At what it would bring at a trade sale at a commercial center? Commissioner Ambler. That is the idea. I am not desiring to say that I think that ought to be the rule, but it is a question for consider- ation, and it has been pressed upon us by several gentlemen. On the other hand, several gentlemen have said it was impracticable. That ’does not necessarily make it so ; but, if it is impracticable, we want to know it, and the reason why. It would seem that complaints of false valuations and false invoices would be very materially overcome by a specific duty. The Witness. But suppose the merchant is dissatisfied witli the ap praisement ; for instance, if an article is imported into this country that has no value, then what shall the appraiser do ? Commissioner Ambler. Just as he does now with articles that are imported that have no foreign value. There are undoubtedly such O. B. SMITH. J PAINTS AND OILS. 355 articles sold in this market that have no market value in the country from which they are exported. But if it had no value here, I suppose the value at the nearest point of consumption might be the test. The Witness. Then in that way what redress would the merchant have if the value was excessive ? Commissioner Ambler. I do not see why he might not have the same redress under that system as under the present. They could ascertain its value, it seems to me, unless in exceptional cases. As a rule they have both the home and the foreign valuation, and it seems to me that an exceptional case would be perhaps as well met here on the home valuation as upon the foreign. The Witness. That system works very well in England. There if a merchant is dissatisfied the government will take his goods and pay him 10 per cent. If that law was properly hedged around it might do very well. Commissioner Ambler. I called your attention to it, so that you might ascertain and give a definite opinion thereupon, now or hereafter, as to whether it is practicable, and what means should be taken to hedge it around so as to do justice to the government and to the importer. The Witness. In that case a great deal would depend upon the appraiser. The government would have to employ the best men for that business. Commissioner Ambler. My understanding is that, as a rule, apprais- ers now are very efficient men. I do not know what your iudgment is as to that. Commissioner Oliver. Are they not very bright ? The Witness. The appraiser, for instance, passed this lot of pre- pared chalk could not have been very bright. Commissioner Ambler. There are undoubtedly instances of incom- petent men occupying such positions, but our general information is that the appraisers are very competent men. The Witness. I think, as a rule, they are; and under an arrange- ment of that kind they would have to be. Q. Why do you think it easier to take the valuation in Liverpool than here T — A. In the first place, there is an American consul there, who can easily ascertain the valuation of goods in those different ports. It is a very simple matter to ascertain the value of china clay, or white lead, or anything else, and he can certify, as he is now obliged to do by the law, in regard to the value of the goods, whereas in this case it is left to the appraiser here to fix the market value. It would work all right in well-known articles, of course. Q. Would there not be the same difficulty that has been suggested in ascertaining the value of these unknown articles in Liverpool as here? — A. I should not think there would be the same difficulty, because the consul is there on the spot. Q. So is your appraiser here on the spot, also. — A. I know; but in the case of well-known goods coming from foreign countries, any com- petent man ought to be able to tell their market value. Suppose there is a brand-new color made — and they are making such things all the time — and it comes here and looks like vermilion, and also looks like Venetian red, how is he going to tell unless he is an expert ? Q. I am assuming that he is an expert in the business. I do not see that he has any business in the position, if he is not. — A. If they were experts, the law would work very well of course. It would be a good system, if well carried out. 356 TARIFF COMMISSION. [O. B. SMITH. By Commissioner Oliver : Q. How low has white lead been in this country in the last ten years ? — A. About three years ago it was the lowest. Q. How low? — A. It was down then to about 6 cents. There might have been exceptional sales at 5g; but it is now 7 cents, and that is about the normal price of it here. By Commissioner Boteler: Q. You were speaking of yellow ocher, and you recommended that it be made duty free. The reason you gave was that the ockers in this country are very inferior. Do you mean that the grade of the American article is inferior to the foreign ? — A. Oh, very much so. The ochers of this country almost entirely present a greenish appearance, and when they are ground to the necessary fineness for painting, that greenness comes out, and you cannot get the proper shade required in a line class of oil cloths for house-painting, <&c. I have never found a single Ameri- can ocher not subject to that defect, and we have had samples from every little mine everywhere. I always examine those that are sent, to see if they are good; but I have never yet found one that was good. The foreign ochers are sold sometimes as High as 9 or 10 cents a pound, and I know of no ocher in this country that will bring more than a cent a pound. Q. Did you see any American yellow ochers at the Centennial? — A. Ko, sir. Commissioner Boteler. There were some very line specimens there. The Witness. They might look very fine, but when you came to use them practically then their merits would be disclosed. The lowest quality of ocher costs about g of a cent a pound, and then you must add at least g for the very lowest freight and expenses. That would bring it to 1 cent a pound for the poorest quality. By Commissioner Underwood : Q. Have you ever seen any samples of porcelain earth from the State of Georgia ? — A. Yes, sir. Q. How do they rank ? — A. Some are good, but there always seems to be some practical difficulty in getting hold of it. I believe there is one kind that makes very good china, but, as a rule, all the very best china is made from foreign clay. Q. Did you ever have any correspondence with a man in Georgia named Hoff on this subject ? — A. I do not remember. Commissioner Underwood. I have seen some specimens of very fine ware made from his clay. The Witness. Did he turn out any quantity? Commissioner Underwood. He has been shipping some, 1 think, to Connecticut, and perhaps to other places. The Witness. The great mass of pottery is made at Trenton, ET. J., and in Ohio. Sometimes they will find a small vein of clay but it will run out in a little while, and the manufactories have to depend upon foreign clay, and I should think it would be an article that ought to come in free of duty, because, I suppose, 90 per cent, of it is used by the paper man- ufacturers and china and porcelain manufacturers. A great deal of china is imported to this country, and we ought to be able to make it here as well as abroad. ROLAND REDMOND. J LINENS. 357 BOLAND BEDMOND. Long Branch, N. J., August 4, 1882. Mr. Boland Bedmond, of New York, of the firm of William Bedmond & Son, importers of linens, appeared before the Commission and made the following statement : Mr. President. I ascertained on Saturday last that you would like to hear from some manufacturers of shirts and collars, who used Irish linen. I have since received a letter from a very large manufacturer in which he says that they are arranging for a hearing, and I think it would per- haps be well to wait and hear from them. As an importer, 1 will say that I am interested in seeing linens brought in at a low rate, but as those gentlemen are the persons who use the goods, perhaps it would be better for you to hear their arguments rather than mine, as they represent the manufacturers. In Troy, N. Y., alone there are some $7,000,000 worth of shirts and collars made annually, and in all the eastern cities there are about $20,000,000 of these goods made annually. The white linens that they use are not made in this country, and it does not seem probable or possible that they can be. The duty as at present fixed is a direct tax upon the home consumer, besides keeping these manufacturers out of the foreign market. They all tell me that if the duty were less than it is at present they could compete successfully with English goods in the great markets of the world. But Mr. Barbour, and some gentlemen who appeared hereon Friday, are in favor of advanc- ing the duty; so I wrote to you hoping you would hear from the manu- facturers of white linens. By Commissioner Oliver : Question. You are importing largely; what is your opinion in regard to the relative merits of specific and ad valorem duties'? — Answer. It is very hard to tell in our goods, because the values are so variable. For instance, the low goods would have to pay a very much higher per- centage than the higher goods. It is a very difficult question, I think. Q. What is your opinion in regard to home valuation, in contradis- tinction to foreign valuation as under the present law ? — A. I do not understand you exactly. Q. I mean instead of taking the consular certificate as to the value of the goods, to assess them in future according to the prices they are worth in the ports which they reach in this country % — A. I think it would be very difficult to arrange that. Q. Do you manufacture abroad ? — A. No, sir; goods are consigned to us by the manufacturers. I think it would be very difficult to arrive at nny home valuation of the goods. 358 TARIFF COMMISSION. [t. w. house. T. W. HOUSE. Long Branch, H. J., August 8, 1882. Mr. T. W. House, of Houston, Texas, submited the following state- ment: Gentlemen of the Tariff Commission: Being deeply interested in the production of sugar in the State of Texas, I beg leave to submit to your honorable body some facts in regard to the same, and hope that you will grant to that industry the consideration and protection which it deserves. A large area of land in Texas is extremely well adapted to the pro- duction of sugar. The lands are never overflowed and the sugar cane ratoons well for three or four years. The chief area of production is now on the Brazos Biver, where the crop in 1880 was about 6,500,000 pounds, and the total area of land there peculiarly adapted to the production of sugar-cane includes a district of 100 . miles in length by about seven miles in width, or some 400,000 acres, all of which under fair protection against the slave and other low-grade labor of the tropics, will soon come into cultivation in sugar-cane. On the southern part of the Colorado Biver, known as “Old Caney,” there is another sugar district in which considerable sugar was pro- duced before the war, and where the industry is now reviving, with a production in 18S0 of about 1,250,000 pounds. This district, scarcely developed at all, is really as great in extent as the Brazos district, and the two together have the capacity of producing at least one-half enough sugar to supply the entire Union, if only protected sufficiently to cover the increased cost of American labor. In these two districts sugar cane is the only certain crop, the lands not being adapted to any other profitable culture. They are capable of supporting a population of nearly a million of people, and then be no more thickly populated than any well-cultivated section of the country. Under anj' other conditions the population must always remain small, for the reason before stated, the non-adaptation of the lands to other culture. It will not require twenty years to develop the industry to the exvent I suggest, and the enormous resulting trade with the other States would reach hundreds of millions of dollars. All of the supplies used in the industry, such as machinery, implements, tools, oils, belting, harness, &c., and all the articles for general use, such as furniture, woolen and cotton goods, clothing, meats, Ac., come from the other States. To whatever extent this sugar industry is developed, a cor- respondingly increased demand for all these articles will arise, of which the other States of the Union producing them will reap the benefit, and there is now arising a rapidly increasing trade in supplying the sugar plantations with these articles. Our sugars are usually of low grade and our protection is in the main- tenance of a fair minimum duty on sugar, as we get no protection from the higher duties, which only protect the refiner. Any reduction in the duties on the low grades of sugar will inflict incalculable injury upon us. WILLIAM M. BRASHER. ] FLOOR-CLOTH. 359 WILLIAM M. BRASHER. Long Branch, 2L J., August 9, 1882. Mr. William M. Brasher, of Brooklyn, N. Y., representing the man- ufacture of floor oilcloths, made the following statement : I wish to state, preliminarily, that in the year 18G6 there were in this country nine manufacturers of floor oilcloths making the wide goods, while at present (owing to the terrible effects of the present tariff) there are but three of those manufacturers left in the business. I will read a memorial which has been prepared upon this subject, and which gives in a compact form the leading points I desire to present to you : The memorial of the undersigned, manufacturers of floor oilcloths, lignums and linoleums in the United States, respectfully represents — That under the operation of the present tariff of customs duties for- eign floor oilcloths, lignums, and linoleums are brought into injurious competition with the domestic productions, and that the manufacturers here no longer enjoy the measure of protection which they had previous to the changes in the customs duties. They further represent that the materials they use are almost without exception such as have in greater or less degree been changed from the state of raw materials to manufactured articles, and that those of foreign origin are subjected to heavy charges of customs duties, and thereby greatly increasing the cost to us. Also, that all the well-known and conceded arguments for the protec- tion of labor will apply with peculiar force to our productions, it being an article which by the preliminary and final processes has become in an unusual degree removed from the original state of raw materials. By reference to the annexed table it will be seen what the chief arti- cles used in our manufacture are, the customs duties on each of them under the tariff of 1857, and those in force at present : Materials used in manufacturing floor oilcloths, lignums, and linoleums. Articles. Canvas. Linseed oil. Dry white'lead. Red lead and litharge. Whiting. Ocher. Customs duties, 1857 Prices, 1882 15 per cent. 15 per cent 37.76 cents 15 per cent. 3.91 cents 15 per cent. . 3.65 cents 15 per cent, f cent per pound. 1 cent per pound. 266 per cent. 15 per cent. 1 cent per pound, i cent per pound. 66 percent. Customs duties, 1882 Per cent 40 percent. 40 per cent. per gallon. 30 cents per gallon. 79 per cent. per pound. 3 cents per pound. 77 per cent. per pound. 3 cents per pound. 82 per cent.. The table shows the advance in the customs duties upon the materials used is very large, while the advance in customs duties on the manu- factured floor oilcloths, lignums, and linoleums has not reached over 45 tier cent. Labor has advanced about 50 per cent., interest account about 50 per cent., and general expenses about the same ratio. In some cases labor- 360 TARIFF COMMISSION. [WILLIAM M. BB ASHER. ers are demanding advanced prices for tlieir labor, and the present agi- tation of the eight-hour system is likely to have some weight in the future. In view of the above-recited facts, the undersigned believe it to be manifest that in the coming revision of the tariff of customs duties they should be further protected by an advance of the duties on floor oil- cloths, lignums, and linoleums of at least the following rates, viz : To change the duty on those paying 35 per cent, to 50 per cent., and on those paying 45 per cent, to 60 per cent., and also all duties should be removed from the canvas used for the manufacturing of floor oil- cloths, lignums, and linoleums. W. M. Brasher, Chairman. John Lapsley, Wm. Potter, Committee. In 1857 all the duties were ad valorem, at 15 per cent. The percentage on the canvas, which is one of our principal goods at present, is 40 per cent.; on linseed oil, 79 per cent.; on white lead, 77 per cent.; on litharge, 82 per cent. ; on whiting, 266 per cent. ; and on ocher, 66 per cent. These are the principal articles we use. Our protection, on the average, is 30 per cent.; sometimes 35 to 40 per cent. ; depending on the value of the floor oilcloth. But give us free trade, and we can export goods in com- petition with all foreigners. We ask for the removal of the duties on floor-cloth foundations for this reason. The whole amount made in this country is only about $50,000 in value. The duty we pay on raw material will average at least 75 ]3er cent., and all we get at the highest rate of protection is 45 per cent. If we can have the same plane to work on that the English manufacturer has, this country can export millions of dollars’ worth of these goods. We are only shut out of the Chinese market by about 10 cents a yard, and out of the Australian market by about 12 cents a yard. Sweden would consume, and does take from Great Britain at the present time, over a million dollars’ worth of these goods annually, and they ask us nearly every day to send them our goods, as our styles are superior, and they will be used there. The government re- ceives to-day a duty of 40 per cent, on $50,000 worth of goods, but at the same time shuts us out of an export trade which would amount to $2,000,000. You may be surprised to hear, but the fact can be estab- lished, that when, during the war, we shipped our goods to Great Britain, the American manufacturers of floor oilcloth brought from 5d. to Id. sterling more in price than the same weight of goods made in London. I am an American, and feel a pride in thinking that our goods are superior in style to theirs, and they admit the fact. The English manufacturers have been to this country to learn our methods, for they could hardly believe that we could make a superior article until they saw that such was the case. All we have to say is this : We are oppressed and our business is being extinguished, and we shall have to yield. The discrimination against us is from 50 to 60 per cent. If you will give us free trade we can send our goods to any part of the world and do an enormous busi- ness. England now controls this trade. We ship some goods to China, but we cannot sell them at anything like the prices the English can sell their goods. W^e make the best goods in our line in the world to-day T , and the English admit it. In connection with this matter of jute and the relief we ask for, I WILLIAM M. BRASHER.] FLOOR-CLOTH. 361 would state that canvas of a certain width is not made in this country at the present time, and it never has been made, except to a very lim- ited extent. I do not think there is any one now making it in this country. I mean burlaps 6 feet wide. The larger proportion of the goods we manufacture is 8 feet wide and 90 feet long. We ask reliof in regard to this matter of canvas because it is not made here in this country, with the single exception that I have named, where the party has a patent loom, and the extent of their business only amounts to $50,000 a year. By Commissioner Boteler : Question. What is the total value of your manufacture in this coun- try ? — Answer. Our own factory produces from 350,000 to 400,000 yards, and the highest price we receive for our goods is 95 cents a yard. By Commissioner Ambler : Q. What is the total value of all that is produced in the country ? — A. I could not tell you that. By Commissioner Boteler : Q. How many hands do you employ in your establishment? — A. About 200 altogether. By Commissioner Oliver : Q. Would you prefer to have the duty taken off the articles which you consume, or to have the duty made larger on oilcloth? — A. We are willing to accept either. With free trade, I think we could export, and our business would increase, so that there would be $5,000,000 worth of these goods shipped out of this country annually. Q. Are you speaking now simply of oilcloth, or of oilcloth and lino- leum ? — A. I am speaking of both. By Commissioner Garland : Q. When you say that if you had free trade you could export your goods, I suppose you refer to the materials used, and not to the finished cloth also? — A. Yes, sir. It is immaterial to us whether the duty is in- creased on manufactured goods, or taken off on the raw material. If we have to pay a duty on the raw material, give us as much duty on the manufactured goods as will counterbalance that duty. Q. Could you export goods under those circumstances? — A. Yes, sir, largely j I think our business would double in amount — I know it would. We have already received offers from London to supply certain quanti- ties of goods at certain prices, on a gold basis. Q. If you were protected by a duty on manufactured goods which would counterbalance the duty you pay on the raw material, you think that you could export goods ? — A. Yes, sir. If we could get the raw materials we use free of duty, I think we could double our business in a very short time. By Commissioner Porter : Q. In that case, would it not be better for you if you had free trade on all goods?— A. Yes, sir ; it would be better if we had free trade on everything. By Commissioner Ambler : Q. Do you mean to say that, with the advantage which would result from proper protection in furnishing you a market in this country, it would pay you better to compete with the manufacturers of the rest of 362 TARIFF COMMISSION. | WILLIAM M. BRASHER. the world ; that is to say, with free trade, and a domestic and foreign market to supply, you would be better off than you would to simply supply the home market under a sufficient rate of protection? — A. Most decidedly. But of course we should not lose sight of the fact that the government gets a revenue of some kind, and, under those circum- stances, we would accept anything like a fair duty on the manufactured goods coming in here, to counterbalance the duty we pay on the raw material. By the President : Q. In other words, without any duty on the raw material, or any protective duty on your goods, could you compete in this market with the European goods? — A. Yes, sir; and we could compete in the mar- kets of the world. By Commissioner Kenner: Q. Of course you are aware that there is a drawback on all goods exported which are manufactured of foreign materials? — A. Yes, sir; but it would not pay us to attempt to collect that. Q. If you pay a duty on your imported material, and manufacture it into articles and exjiort them, you are entitled to a drawback to the amount of the duty paid on the raw material. — A. Yes ; but that would not give us one cent back. When we sent our goods to England during the war we never received a cent of drawback. Q. Then you did not ask for it, or else your goods were composed of American material. — A. The custom-house officers would not discrimi- nate in our favor at all. We endeavored to get that drawback, and petitioned for it, but never received anything. Q. Did you claim that the goods were made exclusively of imported articles on which a duty had been paid? — A. We did that; but they said we paid the duty in labor; and then again this difficulty came in, that we were then using some of the American canvas made on the patent loom; and that shut us out. Commissioner Kenner. Very well; that was the reason. The law provides that you shall receive a certain drawback for the duty that you pay on the raw material when the manufactured article is made ex- clusively of imported material. But, as you state the case, Ido not see that you were entitled to the drawback. The Witness. We could not swear, in point of fact, whether the goods were made on American or foreign canvas. JOHN LAPSLEY. J FLOOR-CLOTH. 363 JOHN LAPSLEY. Lono Branch, N. J., August 9, 1882. Mr. John Lapsley, representing D. Powers & Son, of Lansingburg, N. Y., manufacturers of floor oilcloth, made the following statement : The facts in regard to the condition of our business as affected by the tariff are simply these : The articles used in the manufacture of floor oilcloths were, in the present tariff*, made to pay a very heavy rate of duty, for the reason that at the time the law was passed the govern- ment needed a very large revenue, and at that time these goods would stand it. Of course, Cougress did not take into consideration our inter- ests as manufacturers at all, as they did in many other cases, and there- fore these duties, which are all very heavy, have been, as it were, a dead weight on our trade. In the prosperous times of the war, and immedi- ately succeeding the war, we did not feel these burdens very much; but now when we are coming down to very small margins and there is a keen competition existing, so much so that we are shut out entirely from all the markets of the world where we formerly had a trade, we find that the tariff law has a very injurious effect upon our business. We therefore bring this matter to your notice, hoping that this injustice may be rectified and you may be able to recommend such relief as will be just and fair, and at the same time give to our business the needed protection. It would occupy too much of your time to-day to go into details and state all we should like in regard to the workings of our business. But we desire to lay the principal facts before you so that you may act upon this matter with full knowledge. I think the Commis- sion will see the iujustice of taxing so heavily these materials which we are obliged to use, thereby enhancing the cost of the domestic as well as of the imported article, because the domestic manufacture is gov- erned entirely by the prices of the foreign manufacturers. If we could get free raw materials, or anything approaching it, we could compete with other nations in supplying the markets of the world. This is what we ask your Commission to do for us. By Commissioner Oliver : Question. Do you include in your statement linoleum ? — Answer. Yes, sir. All these fabrics are made in this country, to a limited extent; but they are handicapped by these high duties on our raw materials. Q. It has been stated that a number of oilcloth manufacturers have gone out of the business. Has not that partly been caused by the fact that there was a large increase in the production of lipoleum in this country? — A. No, sir; not at all. That particular branch of business — the “wide goods” branch — has been injured by the importation of the foreign article. The English goods have come in here in competition with ours, and have taken the place, to a very great extent, of the do- mestic goods, so much so that these concerns have given up the business. They were wealthy business concerns, the most of them ; but at the pres- ent time Mr. Brasher and ourselves, and one or two others, comprise all the manufacturers of wide goods in this country. The rest of the de- mand is sui^plied by the foreign article of English manufactured goods, 364 TARIFF COMMISSION. [JOHN LAFSLEY. and of course they can compete with us so long as our foundations — the raw materials — are taxed to this enormous degree, and the manufactured article only to a limited exti nt. By Commissioner Ambler : Q. What is the cloth used as the foundation in the manufacture of your goods made from? — A. It is made from jute, and therefore I sup- pose that we really ought to commence with free jute, so that our man- ufacturers here can manufacture this foundation to the same advantage that the English manufacturer can. We have to pay 30 per cent, duty on jute. It is a very bulky article, and the foundations are not practi- cally made here at all. One concern has a patent loom whereby they can weave these goods better than anybody else, and they have a lim- ited trade in that direction. But, with that exception, nobody attempts to make the article at all. The total amount of capital invested in the manufacture of floor oil- cloth in this country, as far as we can ascertain, is about $6,000,000. The manufactured article is all consumed in this country, with the ex- ception of a few exportations to Cuba, Mexico, and occasionally to the East Indies. We have sent our goods frequently to Hong-Kong and Yokohama, but these were peculiar styles which we make, and for which the people there are willing to give the extra prices that we ask on accouut of their style and the superiority of the goods. But the busi- ness in that direction is so small that it is hardly worth speaking about. We had a fair trade with Cuba and Mexico; but at present there is only a small export trade, and that is gradually drying up. I would state, in reference to this export trade, that this article is used all over the world, particularly in the South American market, and Great Britain has the entire control of that trade. What little trade we had abroad arose on account of our peculiar styles of goods; but we are shut out from those markets now by the higher price we are compelled to charge, and one reason why we are compelled to ask a higher price has already been stated; that is, we are handicapped by these very high duties on the raw materials. By Commissioner Kenner : Q. Are you not also handicapped by the fact that freights from Great Britain to the South American ports are lower than from the United States to the South American ports? — A. Yes, to some extent; but the price is the chief difficulty in the way; that is the principal thing. By Commissioner Garland : Q. What is the amount of capital invested in this manufacture in the United States? — A. It must be somewhere about four or five million dollars. Q. What number of operatives are employed in the United States in the business? — A. I have never investigated that subject. I believe Mr. Brasher has all those figures. Our business has declined now so that we only manufacture a very cheap, common article, such as is not made in foreign countries at all, and which sells for a very low price. The quantity which we manufacture of course is much larger, but the value is less. THADDEUS FIRTH. | MUSICAL INSTRUMENTS. 365 THADDEUS FIRTH. Long Branch, N. J., August 9, 1882. Mr. Thaddeus Firth, of Maspeth, NT. Y., manufacturer of musical nstruments, appeared before the Commission and made the following statement : Though the industry for which I appear, that of small musical mer- chandise, particularly flutes, fifes, clarionets, flageolets, &c., may seem insignificant, such would not have been the case had it received protection at a proper time. Not many years since, when music in this country was in its infancy, the instruments named were in higher favor than the piano-forte, and might have remained so had they received sim- ilar protection to that which nature in our trying climate has afforded the makers of that instrument (foreign pianos will not stand the cli- matic influences of this country), and given employment to great num- bers of people. Your attention is directed to the piano industry to show what might have been done for the one herein advocated, by pro- tection. The reasons I have to give for the proposed change in the tariff are, first, that it would enable American manufacturers to successfully com- pete with foreigners, give employment to a large number of people, and induce the emigration of a superior class of mechanics ; second, as the manufacture of musical goods requires peculiar skill and knowledge of materials in order to combine and suitably put them together, it is an aid in advancing other manufacturing. Many manufacturers of fine work, either of wood or metal or wood and metal combined, have ob- tained valuable knowledge from musical instrument makers. Third, as the superiority of the American piano has caused advancement in music, so the superiority of other instruments (all American instruments being superior to foreign) will lead to a further advancement of that science. Fourth, the practice of music is healthful, particularly on wind instru- ments, as it strengthens the lungs and invigorates the system. How shall we encourage their manufacture ? Only by placing the business on a footing with foreign goods, either by a permanent pro- tective tariff until the market is restored or by free trade on all imported articles. Any half-way revenue tariff is ruinous. As a proof that protection would answer, attention is directed not only to the instance of natural protection afforded to the piano trade, but to the time when gold was 200 percent, premium and over. Duties were payable in gold, and therefore increased the tariff that percentage. Asa consequence, manufacturers of many articles enjoyed a prosperity such as they never can hope for again short of prohibitory tariff, and the credit for this prosperity was, and is now, wrongfully attributed to the greenback currency. When this prosperity ended by gold return- ing to par, and the business revulsion of 1873, the demand for luxuries ceased. Mechanics in our line sought other employment, and some of them, being Germans, returned to their own country, and have now the same facilities that we have. Consequently, we can no longer com- 366 TARIFF COMMISSION. [THADDEUS FIRTH. pete with foreign goods, as foreigners are using our own inventions, with lower wages, to deprive us of our own market ; and there is not at the present time a regularly organized factory operating in the coun- try. Such, 1 am informed, has been the fate of many industries, and the highest protection therefore is required to restore to us the market of our country in many things. Should we regain it again in our line for a few years, the superiority of our goods, with the improved facilities that an increased business would warrant, would enable us to retain the market with but little or no protection. Therefore, for my business, give me either a protective tariff or free trade; and, much as a general free trade policy is to be deprecated, it would in my opinion be far better than a revenue tariff which would cause high prices, and, as a consequence, high wages, without a market either at home or abroad, whilst free trade might afford a possible chance for a market of the world. Hence, if we are to have the great- est general prosperity, such as we once had through the indirect tariff which gold afforded, it must be through protection. If a strictly revenue policy is adopted, much of American manufac- turing will be destroyed and the prices of foreign articles will be increased ; for the obvious reason that revenue is only obtained when imports are admitted, and when such is the case American manufacturing is pro- portionately decreased, and foreigners demand higher prices when not held in check by American competition. If a strictly free trade policy is adopted, our mechanics will be reduced to the level of the labor of Europe, and though we would have a doubt- ful chance in the market of the world, it would not be so desirable as a certain market at home. If a protective policy is inaugurated on all goods susceptible of being manufactured in this country, you restore to the country numerous industries driven from us by force of circumstances, create others equally important, induce the best emigration, obtain sufficient revenue from goods that cannot be produced here, and reduce prices by home competition, until we can successfully compete in the market of the world. By the President : Question. Do I understand you that the manufacture of musical in- struments like these flutes and clarionets is not continued at present in this country? — Answer. They are manufactured only to a very limited extent. The Germans have the same facilities that we had formerly in the manufacture. I have superior facilities now for their manufacture, and, if I had the market for a year or two, I could compete with the German manufacturers successfully. But I need protection, for a time at any rate, to enable me to regain the market. The difficulty of man- ufacturing small instruments like these is greater than you would prob- ably suppose. You might send me the most capable machinist that you could find, and I would give him all the necessary tools to manufacture them, and he would not be able to make one of them unless he had previous experience in this line of manufacture. JOSEPH W. GREEN.] ELASTIC FABRICS. 367 JOSEPH W. GREEK. Long Branch, K. J., August 9, 1882. Mr. Joseph W. Green, Jr., treasurer of the Glendale Elastic Fabric Company, of East Hampton, Mass., representing the manufacture of elastic fabrics, made the following statement : The goods we manufacture are elastic fabrics, and consist of such articles as elastic goring or webbing for boots, shoes, and other pur- poses, suspender webbing, suspenders, narrow elastic woven fabrics, such as loom webs, car webs, &c. They are union goods. One kind is pomposed of silk, cotton, and rubber, another of cotton and rubber, and another of wool, worsted, mohair or similar yarns, cotton and rub- ber. These three kinds of stock run through all the fabrics in all the different varieties. The present rates of duties on these classes of goods are as follows : On elastic goring or webbing for boots, shoes, and other purposes, com- posed of cotton and rubber, 35 per cent, ad valorem ; on the same goods, composed of silk, cotton, and rubber, 50 per cent, ad valorem ; on the same goods, composed of wool, worsted, mohair, or similar yarns, cot- ton, and rubber, 50 cents per pound and 50 per cent, ad valorem ; on elastic cords, braids, and narrow elastic woven fabrics composed of cot- ton and rubber, 35 per cent, ad valorem ; on elastic cords, braids, and narrow elastic woven fabrics composed of silk, cotton, and rubber, 50 per cent, ad valorem ; on elastic braces, suspenders, suspender webbing com- posed of cotton and rubber, 35 per cent, ad valorem ; on the same goods composed of silk, cotton, and rubber, 50 per cent, ad valorem ; on the same, composed of wool, worsted, mohair or similar yarns, cotton and rubber, 50 per cent, ad valorem and 35 cents per pound. Our industry has been in a specially precarious position from the ambiguous terms used to specify or not to specify our goods in the pres- ent tariff. And as a result, ours has been a very fertile field for sharp or shrewd lawyers desiring to build up a profit for themselves and im- porters of foreign fabrics by instituting proceedings against the govern- ment, causing decisions to be made reducing duties and allowing draw- backs or refunds bn no less than three of our fabrics, viz, suspender webbing, silk, cotton, and rubber shoe webbing, and wool or worsted, cotton, and rubber, owing to the vague wording of clauses in the tariff*. Our industry has been built up on the protection named. But wliat we desire is a relative protection now in proportion to other goods made of similar materials. At various times during the last few years there have been importers who have protested against the rate of duties charged, and lawyers who have worked in their interest have carried the cases through the regular process to enable them to obtain what they considered their law- ful rights. First, they have been referred to the appraiser, then to the Secretary of the Treasury; and in each case it was decided in favor of the government, and we finally have carried the cases into the courts. Some of the cases have been decided in the lower courts against us, and some for us. Of three notable cases, the first was in regard to sus- 368 TARIFF COMMISSION. [JOSEPH W. GREEN. pencler webbing, which case came up in New York City. That was not a case of ours, but, at all events, it was decided finally in the Supreme Court of the United States that the goods should come in at a 35 per cent, duty, whereas before they had paid a duty of 50 per cent. Our own individual case, the first one, was in regard to union webbing, spoken of here as shoe goring, or webbing, in which the article of chief value was silk. There were also cotton and rubber in the goods. In the lower court, which was the district court in Boston, Judge Lowell decided in favor of the government and against the manufacturers. That case was carried to the Supreme Court of the United States, and there the judgment was reversed. The last case which we had was a case of worsted webbing, or goring, on which our protection is 50 cents a pound and 50 per cent, ad valorem. The ground that the importers and their counsel took was that the goods should be admitted at 35 per cent, duty, instead of 50 per cent. In that case, which came up in the United States district court in Boston, under the same judge (Judge Lowell), he decided against the government and in favor of the manu- facturers; vffiereas in the former case he decided in favor of the gov- ernment. That case is now carried up to the Supreme Court. It has not yet come up before the Supreme Court, and I presume that it will not at present. But the difference there is quite marked. It amounts to fully 20 cents a yard, and if the case is successful it would of course ruin our industry completely in that particular branch of the business. But the point which I want specially to make is, that we have no com- plaint to make or fault to find about the rate of duty under which we have been protected, and we are perfectly willing to stand any reduc- tion which is in proportion to reductions made in other directions. All we ask is that we shall be put on the same footing with others, and that we shall know exactly what our status is. We want our case to be stated so clearly in the new tariff that there can be no doubt, when the question comes up, as to what the rate is. The difficulty seems to have been that our goods were not mentioned clearly and fully in the original tariff', or in the revision in 1875. I suppose there was a reason for that. In the first place, the goods have not been manufactured a great many years. This is comparatively a new industry, although it has grown very materially during the last eight or ten years. Yet, when the tariff under which the duties have been charged was first in force, our industry was a very small one, and it is not strange that we should have been partially overlooked. We have been classed in with “web- bing,” which may mean a great many different things. That word “webbing” has always been the word on which the doubt has seemed to exist as to just what it meant, as to whether it should include shoe goring or not. We call it in our business, and have always called it, goring, because it is used for a gore in the shoe, and it seems to us that it is a much more proper name for it than to call it webbing, which may mean almost anything. By the President : Question. Have you with you a piece of the fabric of which you are speaking? — Answer. Yes, sir, I have; and I will show it to the Com- mission at the close of my statement. We do not ask any addition in the rate of protection to that upon which we started our industry, and on the faith of which we put our capital into the business. Q. In short, you want the rates of duty maintained which were under- stood to exist at the time when you commenced your business ? — A. Yes, sir. JOSEPH W. GREEN.] ELASTIC FABRICS. 369 Q. Your case is something like the case of the knit-goods manufact- urers, is it not? — A. Yes, sir 5 it is very similar to the knit-goods case. By Commissioner Garland : Q. Will you please furnish us with the technical terms that you pre- fer to have employed in the tariff in designating the articles you manu- facture? — A. Yes, sir; I will give the Commission a memorandum on that point. There has been great difficulty owing to the ambiguous terms used in respect to webbing. I really do not know what the com- mercial name properly is. The manufacturers of elastic shoe webbing in Leicester, England, call this “elastic webbing.” There is a firm of T. W. Hodges & Sons in England who call themselves “elastic-webbing manufacturers,” and the great bulk of the manufactures which they have exported to this country, in years past, has been elastic shoe goring, or webbing. By the President : Q. Can you state the extent of this manufacture in this country gen- erally? — A. Including the item of shoe goring, I should say it would amount to at least $500,000; and including the suspender webbing and suspenders, it would be very much larger. The industry altogether is a very large one. H. Mis. 6 24 370 TARIFF COMMISSION. [8. 8. SARGENT. S. S. SABGENT. Long Branch, N. J., August 10, 1882. Mr. S. S. Sargent, of Newark, N. J., representing the Sargent Man- ufacturing Company, manufacturers of saddlery hardware, made the following statement: Gentlemen of the Tariff Commission : I heartily indorse what has been said on the subject of duties on saddlery hardware by the gentlemen who have preceded me. Our company does not manu- facture the same class of goods manufactured by other factories rep- resented by the gentlemen who have spoken to you, for the simple reason that we found the profit was so small in the commoner lines of goods that we gave up that branch of the business. Formerly we did manufacture some of these goods, but the prices became reduced to such a point that we concluded to abandon their manufacture, and we have to-day a large stock of some of these goods which we are hold- ing, hoping that prices may advance so that we can dispose of them. If we sold them at the prices ruling to-day, we should have to sell them at cost or a trifle under cost. If any change at all is made in the tariff, I should recommend that the present rate be advanced at least 5 or 10 per cent., for the reason that on the class of goods made by the company which I represent, hand labor is employed to a very large ex- tent. They are the finer grades of goods, and the difference in the price of labor here and abroad is so great that if the present rate of duty was reduced the foreign manufacturers could bring their goods in here and undersell us without difficulty. They do so now to a certain extent, but if the duty should be reduced, the importations would be largely increased. So that I wish to be recorded as requesting an advance rather than a reduction in the present tariff. D. MCKEEVER.] DRY GOODS. 371 D. McKEEVEE. Long Branch, IT. J., August 10, 1882. Mr. D. McKeever, of New York, importer of dry goods, made tiie following statement: My object in appearing before the Commission this morning is not so much to offer suggestions in regard to reductions in the tariff* on the goods we are interested in, as to request that you will endeavor to have more equitable rates of duty imposed; that you will endeavor to remove many of the absurdities and ambiguities that exist in the present tariff*. We feel, although we are importers, that the American manufacturer is en- titled to a certain amount of protection, that is, to fair protection. We think that he should have his raw materials free as far as he possibly can get them, and that the difference in wages between the two countries should be offset by giving him a fair protection. We import cotton goods, stuff* goods, and woolens. As tar as cotton goods are concerned, it is a general impression that they pay a duty of 85 per cent. But the cotton-goods section of the tariff is one of the most ambiguous of any of the provisions of the tariff act. The rates are various, running from 25 to 100 per cent, on manufactures of cotton. The present rates are both ad valorem and specific, separate and together. We would sug- gest that the duty on cotton cloths be changed so as to make any man- ufacture of cotton, or of which cotton is the component part of chief value, 35 per cent, ad valorem. We think that if the American manu- facturer got his material free, that would offset the difference in wages between the two countries. At present the duty on linens is 30, 35, and 40 per cent. If a manu- facture of cotton has a little linen in it, it only pays at present 40 per cent., whereas if it was all cotton it would make tbe duty close on to 100 per cent. We think that the whole thiug should read that all manufac- tures of cotton and flax should pay one uniform rate of duty of 35 per cent, ad valorem. We are also interested in stuff goods, known more familiarly as dress goods, alpacas, and materials for ladies, and chiklreifs dress goods. The present rate of duties on these goods is exorbitant, and prohibitory in very many instances. We think that if the American manufacturer can receive his dye stuffs and his raw materials free, which he is cer- tainly entitled to, that would be in itself a great protection. According to my experience, if the American manufacturer can receive his wools, dye-stuffs, and everything that goes into his manufacture, free, a rate of 35 or 40 per cent, would be a fair and equitable rate of duty. The rates at present, consisting of ad valorem and specific duties, affect very inju- riously all the lower grades of goods, that is to say, goods such as the mechanic or the farmer and workingman needs. Such goods have to pay a duty of 80 to 100 per cent., whereas the finer grades, which he cannot afford to touch, would not pay a duty equal to 40 or 50 per cent. So that if the rates were all made uniform it would equalize the matter and be fairer towards all parties. We are also interested in the importation of manufactured w r oolens. I suppose the gentlemen of the Commission are all aware that the duties 372 TARIFF COMMISSION. [D. MCKEE VER. on woolen goods are very heavy, for the reason that they are ad valorem and specific, the specific rates being 50 cents a pound, which keeps out all the lower grades of woolens. The importers have to pay a rather high duty on the goods, but 1 think 175 to 200 percent, protection is more than the manufacturers in this country should ask. We do not see why any workingman or farmer cannot get his heavy, cheap stuff in at 40 to 50 per cent., which is about the rate that is paid for the higher quality of goods that we use. We suggest that the specific rate be stricken off the manufacture of woolens and an ad valorem duty put upon them. in regard to the subject of specific duties rather than ad valorem duties, as far as our experience enables us to judge, we think that the specific rates should be removed altogether. A specific rate is not a fair rate of duty; that is to say; it discriminates against the poorer consumer. Any specific rates of duty imposed must necessarily op- press the poorer classes who use the coarser grades of goods. It has been claimed, I know, that a specific rate of duty has a tendency to pre- vent frauds upon the revenue, but it is my opinion that if a custom- house examiner can be induced to shut his eyes to the fact as to whether an article cost 10 or 20 francs, he can also be induced to shut his eyes to the fact as to whether it weighs 10 or 20 pounds, or as to the number of yards contained in the package. If the duty is assessed on goods by the yard, they can easily be undervalued by a misstate- ment of the quantity. So that specific rates are really injurious to the lower grades of goods, ox>pressive to the workingman and farmer, and should, we think, be removed. By Commissioner Underwood: Question. I understand that your business is that of an importer? — Answer. Yes, sir; we are importers of dry goods. Q. You are not concerned in any manufacturing establishment? — A. Ho, sir. Q. I would like to inquire of you in regard to the subject of home and foreign valuations. Do you think that the home valuation or tbe foreign valuation is the proper standard of assessing duties? — A. If I may be permitted to state it strongly, I would say there is no such thing as a home valuation, that is if you mean by that the American valua- tion, and there can never be such a thing as an American valuation. We import goods to-day that cost us 26 cents, including the duty, aud we call that the American valuation, aud we try to sell them at 27 cents. Our neighbor, who may be overstocked with these goods and who has other reasons for selling, will offer these same goods at, say, 22J cents, or even a lower price. How can we get the true American valuation under these circumstances ? Such a thing does not exist. By Commissioner Ambler : Q. Would there not be, possibly, the same variation in values abroad that occurs here ; that is to say, may not a manufacturer there be over- stocked, and as a consequence sell out at much less than the cost price ? — A. No, sir. Our experience shows that the English manufacturer con- ducts his business on a different basis from the American manufacturer. In the first place, he has more of a market to supply; that is to say, he has the world before him, and he does not consequently become over- stocked so readily as his American brother. If the American manu- facturer had the raw materials he would not be overstocked so much either. D. MCKEE VER.] DRY GOODS. 373 By Commissioner Kenner: Q. The manufacturer in Europe sends an agent here and he consigns his goods to that agent. He has a monopoly of the manufacture of that particular class of goods, and when he consigns them to that agent, he puts any value that he sees proper on them, and we never can get behind that valuation, because there is no one but the man who sends them here to fix the price, and he fixes the price to suit his own pur- poses. Does not that condition of things exist? — A. Yes, sir, it does to a certain extent in regard to certain articles, particularly in regard to kid gloves. But so far as that is concerned, if the examiner here is a proper officer, he can tell the value of those goods in comparison with other goods that are coming in here that are not exactly consigned by this special man. Take the article of kid gloves ; if a kid glove impor- tation comes here, it is of a certain quality, consigned by this man to his agent. The examiner has dozens of invoices of other gloves, prop- erly invoiced, of equal value, and he can, according to his own judg- ment, put a proper value on these goods. Q. We cannot predicate legislation on the fact that the officer is not an honest man. We always take the ground that the inspector is honest, no matter what system we adopt. If you leave the man to put the value on his goods, he will necessarily put them at the lowest possi- ble value, in order to pay a less amount of duty upon them. Of course the foreign manufacturer would be in a position to exercise that right of putting his own value on the goods. — A. You are quite right in sup- posing that the manufacturer will put his goods in at the lowest possi- ble valuation ; but it is the duty of the government officers to see that the manufacturers do not put their goods in at too low a rate. By Commissioner Garland : Q. Do you mean to say that you think the government officers are able to detect every attempt at undervaluation? — A. That would be rather a broad assertion, if I should say that they detected every at- tempt, but I think there are very few cases of undervaluation that the government officers do not look after and investigate. I do not know whether it would be in the province of your Commission, or whether it would have anything to do in the formation of a tariff bill, but there is one fact in connection with the matter of the inspection of these goods by custom-house officers in New York that I may be allowed to refer to, and that is, that, as a rule, these men are decidedly underpaid. We think that if the government would pay these men proper salaries for their services, there would be very much less danger of importers getting in their goods at an undervaluation. It seems almost absurd for the government to appoint men to these responsible positions, where there is so much at stake, and yet give them such paltry salaries as they receive. 1 think the usual salary paid to these expert officers is only about $2,500 a year. Q. Then I understand you that it is your opinion that there are very few successful attempts at undervaluation ? — A. That is so, according to my experience. Of course I have no official information upon that subject, but am only speaking of what I have heard and seen of such things, when I say that I think there are not many successful attempts at undervaluation. By Commissioner Oliver : Q. Are you aware whether the importers in your line in New York have ever made complaint that a different valuation is put on goods im- 374 TARIFF COMMISSION. [D. MCK.EEVEU. ported at different ports ; that is to say, that one value is put upon them at the port of New York, another at the port of Boston, another at Bal- timore, Philadelphia, Chicago, and other places? — A. Yes, sir; there was a question of that kind came up a few years ago in regard to cotton Italians. We were paying at that time a rate of duty equal to about 00 per cent., and we understood that they were admitted into Chicago at 35 per cent, ad valorem. Q. But I am speaking of cases where the duty is fixed, and you are alluding to cases where it comes in on the question of classification. I am speaking of cases where there is no question about the classification of the goods, but only in regard to valuation? — A. I could not answer that, except to say that I have never heard of anything of that kind. By Commissioner McMahon: Q. Is it not the general understanding that it is for the interest of every reputable importer to assist, to the best of his ability, the govern- ment officers in detecting frauds in regard to the valuation of goods; is it not to their interest as importers? — A. Most decidedly it is to their interest. If we import goods on which we pay according to the invoice 100 cents on the dollar, and 50 cents duty, it is our interest to see that nobody else can get the same class of goods in at a total cost of $1.25. Commissioner Oliver. My question was directed to that same point; that it is your interest to see that the valuation on goods imported by other parties is the same as on goods imported by yourself, whether the valuation is placed upon them in Baltimore, or Charleston, or New York. — A. Yes, sir; it is for our interest to see that that is done. SAMUEL T. SNOW.] METAL SHEATHING. 375 SAMUEL T. SNOW. Long Branch, N. J., August 10, 1882. Mr. Samuel T. Snow, of Boston, Mass., treasurer of the Revere Copper Company, made the following statement : In presenting our case, which concerns the yellow-metal manulacturers alone, we desire first of all to have it distinctly understood that we do not in any way propose to disturb any other interest whatever. We do not appear as high protectionists, or for the purpose of advocating protec- tion in the least, nor, on the other hand, as favoring free trade — neither one nor the other policy — but simply and solely to urge, as we have never for a moment in the past ten years ceased doing, that a palpable error and gross incongruity in the present tariff may be corrected. And we have a right to expect that it will be, as every committee before whom the matter has been brought, and every individual member of Congress also, has acknowledged the wrong, and promised that, when- ever an opportunity were presented in any adjustment of duties, this should certainly be set right. And now, more than any other body, this Commission should present the subject in its true light. We assume, of coarse, that the Commission understand the mixture of which yellow metal is the product. It consists finally of six parts ot copper and four parts of spelter. A larger proportion of spelter is necessarily used to provide for the inevitable wastage which takes place in the process. By the act of June 6, 1872, section 10, it was provided that certain enumerated materials, including “ copper and composition metal,” neces- sary for the construction and equipment of vessels built in the United States for the purpose of being employed in the foreign trade, could be used in bond without the payment of any duty thereon ; and, further, that all articles of foreign production needed for the repair of American vessels engaged exclusively in foreign trade might also be so used. At the same time a duty of 3 to 5 cents per pound on copper, accord- ing to condition, and of 1J cents per pound on spelter was allowed to remain, and has been unchanged since. The Treasury Department ruled that “ copper” in the act meant copper in any form required, and that u composition metal” must also be under- stood as meaning “yellow metal ” in any form wanted by the ship- builder. The department also ruled that it was intended to permit vessels repairing under this act to engage in the trade between the Atlantic and Pacific ports of the United States, as had been allowed for new vessels, and accordingly that was done. These rulings were legal- ized by section 5 of the act of February 8, 1875. We make no special mention of copper manufactures, because their use for vessels is now so exceedingly rare. The use of yellow metal has almost universally supplanted the use of copper. In the first place, it never was intended that anything more than the raw materials should be admitted free of duty for these purposes. By turning to Mr. Lynch’s committee’s report on this very’ subject, made to the Forty-first Congress, second session, Doc. II. R. No. 28, it will be found that the committee took that ground clearly and distinctly, and 376 TARIFF COMMISSION. [SAMUEL T. SNOW. proposed as the method to revive the interest of American tonnage that a drawback on raw materials so imported and used should be allowed. And the bill introduced by it at that time begins with the same enume- ration as the one finally passed, excepting only that the word “ copper” was afterward added. It will be observed, too, that in this last act “ lum- ber, timber, hemp, manila, copper, and composition metal” are all alike raw material. Lumber does not mean finished work, timber does not mean a completed vessel, hemp and manila do not mean cordage, nor do copper and composition metal mean sheathing or bar any more than any other lorm of their manufacture. When anything more than the raw material was intended it was so stated, as, for instance, “ iron and steel rods, bars, spikes, nails, and bolts,” in the same enumeration. And it has always seemed to us that the Treasury Department, instead of being prompt to rule against the manufacturer in this country, should have rather leaned the other way ; and, further, should have decided, if looking for intentions at all, that in the second part of the act “articles of foreign production” were also only raw materials. To be consistent with the purpose originally manifest, and with the clear reading of the first part, no manufactured article should have been used. This position, so far as the intention was concerned, is fully stated in a report made by Mr. Frye, from the Ways and Means Committee, to the Forty-sixth Congress, second session, Report No. 1261, in which this subject is thus set forth : “ The purpose of this bill is to correct an incongruity in the existing tariff laws, whereby a manufactured article, yellow-metal sheathing, is admitted free of duty, while the raw materials composing it, copper and spelter, are required to pay a duty. The effect of the piesent law is a discrimination against our own citizens engaged in the manufacture of sheathing metal, and in favor of the foreign manufacturer. This result, which is in conflict with the spirit of the existing laws, comes from an oversight in legislation, and which your committee believe was never intended. It has not been the purpose of Congress to make our mar- kets free to the foreign manufacturers, and tax those in this country en- gaged in the same industry with a duty upon the raw materials neces- sarily entering into the product. A competition of this kind, created by law, is unfair to our citizens, and could end only in the destruction of their manufacturing enterprises. “ The provisions of law which work this hardship, and which are sought by this bill to be remedied, are found in Revised Statutes, sections 23 13 and 2514, which were enacted June 6, 1872, and a part of section 5 of the act of February 8, 1875 (Forty-third Congress, second session, ch. 36, sec. 5). “A brief historical statement of this legislation will explain how the error occurred which is now sought to be corrected. “On the 17th of February, 1870, a special committee on the causes of the reduction of American tonnage reported to the House that one remedy was ‘the remission of the duties imposed upon the rate material entering into the construction of vessels and steamers, limiting the amount to the minimum of duties per ton collected on the material re- quired for certain classes of vessels, and where American iron is used in the construction of iron vessels, an amount per ton equivalent to the duties on a like amount of imported raw materials, limiting the amount to be paid.’ The bill offered by the committee provided ‘that upon all imported lumber, timber, hemp, manila, and composition metal, and upon iron not advanced beyond plates, rod, bars, and bolts, which may be used or wrought up into the construction of steam or sail vessels, * * # METAL SHEATHING. SAMUEL T. SNOW.] 377 drawbacks shall be allowed # * * equal to the duties which may have been paid on such materials. 7 “ This bill and the suggestions of the committee obviously were intended to protect manufacturers, while at the same time the shipping interests were aided. The bill carefully limited the right of drawback on metals to ‘ composition metal, 7 and ‘iron not advanced, 7 &c., to a completed manufacture. ‘Composition metal 7 was a phrase defining a compound of copper and zinc, well known by ship builders, and distinct from yellow metal or its manufactures, which were also well known. The report of the committee was based upon testimony from merchants and ship- builders. “The act of June 6, 1872, entitled an act ‘to reduce duties on imports and internal taxes, 7 was the first enactment which embodied the above- mentioned bill. In the section of the act which provides for the draw- back, the words used, when the bill passed the House, were ‘lumber, timber, hemp, manila, iron, and steel not advanced beyond rods, bars, bolts, copper , and composition metal. 1 In the Finance Committee of the Senate, or in the conference committee, the words ‘not advanced be- yond 7 were stricken out and ‘spikes and nails 7 inserted. These articles, either raw r materials or partly manufactured articles, could be used in the construction and equipment of vessels employed in the foreign trade, including trade between Atlantic and Pacific ports. The next section provides that all articles of foreign production needed for the repair of American vessels engaged exclusively in the foreign trade may receive the drawback. “This bill shows that the purpose of Congress was to give drawbacks on metal tMinanufactured (or not completely manufactured) and on raw materials; especially does this appear when we notice that the word ‘plates, 7 which was in the first bill, is omitted, as if that were a too far advanced state of manufacture of iron and steel to allow the draw- back upon. “It was proposed at the time of the original legislation on this subject to grant further privileges to vessels engaged exclusively in the foreign trade, extending drawbacks to ships’ stores, &c., but Congress was con- servative and sought to save domestic manufacturers from unnecessary discrimination in favor of foreign manufacturers. “The act of 1872, fairly interpreted, did little injury to the sheathing manufacturers. The Treasury Department, however, had given various interpretations to the phrase ‘composition metal, 7 and in some instances had decided that under this phrase, in cases of the equipment, construc- tion, or repairs of American vessels, yellow-metal sheathing should be allowed the drawback. At the request of the Treasury Department, the act of 1875 was passed which gave a legislative definition of yellow sheathing metal for the purposes of revenue. It did more than this by providing a drawback for the manufactured yellow metal, putting it in the same category as raw materials , and by its terms making the duty higher than ever on the manufactured articles. This drawback is al- lowed in the construction, equipment, or repair of vessels built in the United States employed in foreign trade, including the trade between the Atlantic and Pacific ports, without the two months 7 limitation in the act of 1872, thereby cutting off any faint possibility of finding a market for this industry. “Your committee recommend the passage of the accompanying bill as a substitute for the bill referred, which, if passed, will correct the evil now existing in the positive discrimination made against the American manufacturer in favor of the European manufacturer, and which w ill, it 378 TARIFF COMMISSION. [SAMUEL T. SKOW. is believed, transfer to this country the manufacture of raw materials now manufactured in Europe. The drawback allowed on the raw mate- rials which are used will give the purchasers the same advantages they now have in price and quality of the manufactured articles. If copper and spelter were furnished to our manufacturers free of duty, they could make and sell yellow-metal sheathing to vessels engaged iu foreign trade as cheaply as the English sheathing can be furnished here, even after the allowance of the drawback which is now granted to the Eng- lish sheathing.” No one ever asked, nor was it ever proposed as at all necessary, that vessels repairing should have any such peculiar privileges. The object of the whole movement from its very inception was to encourage sliip- building in this country, and with this we are in the fullest possible sympathy. We are ready to assent to almost anything, however it may affect us, likely in the least to increase the facilities for building vessels here, and to put ship builders in as good a position here as anywhere else in the world; giving them all their materials for construction and equipment, manufactured even, if it m ust be*o, absolutely free. But when once a vessel has been constructed and equipped, when ready to com- pete with any others iu ail parts of the world, then she should take her chances with them. We fail to see any reason why she should have her supplies cheaper than if in the coastwise trade, or cheaper than a foreigner if making repairs here. No foreigner can use anything in bond under these laws. No foreigner can in that way supply his own vessel, but he may come here and furnish an American vessel with sheathing copper or sheathing metal, or bars, provided the article is of foreign manufacture, free ot duty, whi n we cannot. If that is really intended, then it is simply a law to protect foreign manufacturers against home manufacturers in our own market. Practically, then, we have been deprived of our business in this direction excepting for coastwise vessels and for foreigners thrown upon our shores in distress. When a vessel has been constructed and equipped, fostered and en- couraged thereto by special legislation, must she for all time thereafter be subsidized to keep her afloat*? Are we ready to acknowledge that, possessing the ship, we are unable to compete successfully with other flags lor the carrying trade open to all alike ? If so the fault is not here but elsewhere. The remedy has already been sufficiently indicated. Not by removing the duties on copper and spelter, which, however, would be a complete and, to us, satisfactory cure, as then we could successfully compete with any foreign manufactures therefrom, anti could reduce tbe prices of our manufactured articles not only to vessels engaged iu the foreign trade but to all others as well; nor by depriving ship builders of the advan- tages they now possess under the present laws. As said at the outset, we antagonize neither one interest nor the other. But by restoring the act to the form given it at first, so that the raw materials from which our manufactures are made may be manufactured and used in bond for the construction and equipment of vessels; not permitting the foreign manu- factured article to be used in bond, and not including their use even of the raw material for repair at all, and putting it in such unmistakable terms that it cannot again be perverte . by the Treasury Department, whose tender mercies toward us have been cruel in the extreme. But if our condition is so deplorable and desperate that our vessels cannot be sailed in an open and equal competition with others, then, too, the raw materials alone should be used in bond. SAMUEL T. SNOW.] METAL SHEATHING. 379 The Commission will not certainly fail to appreciate the claim that, so long as the same end can be reached by the use of raw materials in bond, the admission of the foreign manufactured articles free of duty is a wrong incapable of justification, and we are sure of having shown that it was never so intended. By Commissioner Ambler : Question. Will you please put in writing the precise form of change in the tariff which you desire ? — Answer. I will do so. Commissioner McMahon. I understand your position to be this: that if you manufacture these goods out of the raw material you are allowed a drawback on them ? The Witness. We import no copper into this country, and we im- port no spelter, or substantially none. All the copper that is used in this country is mined here, and all the spelter substantially that is used is obtained in this country. So far as copper is concerned, we go a step beyond that. We produce some years more than we can sell, and, for the purpose of adjusting the market so that the duty on imported copper can be availed of, a certain portion of our production is shipped abroad at any price it can bring, so that the quantity to be disposed of here is reduced to the requirements of the market, the price of which can be kept up to the point made by the addition of the duty on the importa- tions, if any are made. So that in fact we do not import any copper or any spelter. Q. You make yellow sheathing and yellow-metal bolts fit for ship- building use out of domestic materials? — A. Yes, sir; a certain quantity of yellow metal for ship building is imported as a manufactured article under this law. Now we want to have that imported in the raw mate- rial, and have the copper and the spelter imported and manufactured and used in bond. There is no provision for that. By the President : Q. What is yellow metal composed of? — A. Ultimately of six parts of copper and four parts of spelter. There is a larger proportion of spelter used in the composition, for there is a large wastage in it in the pro cess of manufacture ; but the result is as I have stated. By Commissioner Oliver : Q. You want the raw material as well as the finished article imported in bond? — A. We do not wish the finished article here at all; we want to make it ourselves; we want the manufacturing of it here. Q. Out of our own product? — A. No; out of the foreign product. It is brought in manufactured now. We want the raw material to be brought in and manufactured and used in bond. Now it is simply used in bond, but not manufactured. By Commissioner Garland: Q. YVliat effect would that have upon the price of the manufactured article in this country? — A. The price would be the same as the foreign article is now. We can take the imported copper and spelter free of duty and can furnish the manufactured article as low as the English manufactured article is sold. I may add that when this business was commenced in 1843 there was no duty either on the raw material or on the manufactured article, and we built the business up without any protection. But we were importing then copper and spelter with- out paying any duty on them. Under those conditions we built up the business and secured the markets for this country. We did more 380 TARIFF COMMISSION. [SAMUEL T. SNOW. than that; we supplied some other markets of the world. For instance, we used to ship bars and sheathing metal to China and Chili in large quantities and compete with the English manufactured article there. Give us the raw material to-day, without the payment of duty, and we will do the same thing again — not immediately, but in a very short time we can do it. We have done more than that. We came very neaT doing a very handsome thing in our line of business, although we did not quite succeed, owing to circumstances which we could not control. We sold a suit of metal to be taken from Boston and put upon a vessel at Liver- pool at the price at which the English metal was sold in Liverpool. We made that agreemeut ; but at the last moment it was found that the ves- sel did not require it. If she had we would have taken our metal and carried it to Liverpool and put it on the vessel at the same price the English were selling their metal for there. By Commissioner Kenner : Q. When did you do that; under the present tariff? — A. No, sir; it was before there was any duty on either copper or spelter. By Commissioner Garland: Q. To enable you to do that did you not furnish the material at a cheaper rate than you would ordinarily furnish it in this country? — A. No, sir. When Muntz’ metal was first patented, of course it was sent into this market, because previous to that time they were selling copper sheathing for vessels, and it immediately took the place of copper in the market. We had to drive that out. We did not succeed immediately, but after a while we did succeed in driving it out completely, and we secured this market for our material and went on with its manufacture. We also supjdied markets elsewhere which had before been supplied by England, and came very near, as I have stated, sending the metal to England to be used there in the repair of this vessel. JOSEPH BALDWIN.} SADDLERY HARDWARE. 381 JOSEPH BALDWIN. Long Branch, N. J., August 10, 1882. Mr. Joseph Baldwin, of Newark, N. J., of tlie firm of Joseph Bald- win & Co., manufacturers of saddlery hardware, made the following statement: I represent one of the oldest firms engaged in the manufacture of saddlery hardware in this country. Our specialty is the manufacture of fine goods, principally wrought goods of a fine grade; but we find many difficulties in tbe way of their manufacture. The manufacture of fine goods of this descriptiou was only commenced in this country a few years ago. Formerly we could not attempt their manufacture, but since the present tariff has been in operation we have been able to manufact- ure certain kinds of these goods. We sent to England and got the best workmen we could find ; and, in order to keep these men in our employment, we have to allow them fully as high wages, or higher wages than they were receiving in England. The reason for this is that the cost of living in this country is much greater. Men who are able to make five shillings a day in England want to make here at least $20 a week. We have men in our employment who make from $27 to $30 a week. The reason for this difference in wages is on account of the scale of living. In England they are content to live on plain food and ale and cheese, and the families all assist in the labor, while here the children do not want to work — society is different, and they are sent to school; and the larger salaries are based upon these different social conditions. The laborers in this country have to pay more rent, and the cost of living in every way is greater; therefore they must have larger wages. The result is that our goods cost us double the amount as far as the labor is concerned. We had a filer in our establishment who made $27 last week, and lost one day’s work during the week. That same man in England would work for one-half that sum and be fully satisfied with it, because he would be able to live on the same scale with his neighbors. But here he is not satisfied with lower wages. There is another element which outers into this matter, and that is that in England they can finish these goods better than we can, and for this reason : that the father, the grandfather, and the great-grandfather have followed a certain line of business, and workmen are consequently, as a rule, more expert, owing to the fact that they and their ancestors have been so long engaged in the same business. It is so with most other trades. Take a chain-maker or a bit-maker, and you will find that all his ancestors have been chain-makers or bit-makers. We have a bit- maker in our factory who earns $30 a week, and I found, upon inquiry, that for several generations all his family had been in that same line of business. This man will not work for the same amount that he would work for in England, for, as I have said, the cost of living and all the other conditions require that he should receive a higher rate of wages. Not only is the rate of wages higher, but the cost of material and every- thing is greater in this country. If I should go to the man I have spoken of and say to him, “You were only receiving $10 a week wages in 382 TARIFF COMMISSION. [JOSEPH BALDWIN. England, and you should work at that rate for us,” he would prefer to go back to England, where he could live at a reduced rate, rather than to try and live here on the same wages. Mr. Gwinnell spoke about the importation of goods from abroad. On certain styles of goods we are compelled to ask just double the price they can be imported for from England. One of the largest importers in this country, of fine articles in our line, used to buy of us hundreds of dollars worth of goods, and said to me not long since that he would like to continue to buy his goods of us, but that he had visited England last year, and found that he could buy at a much cheaper price, and, con- sequently, he imports nearly all his goods at present. In this country we manufacture many new styles of goods, but I have discovered that a new article is not in the market two months before it is imitated in England and imported to this country. This importer of whom I have spoken, for instance, will take an improved bit and send it to the manu- facturers in England, and they will imitate it and send it back here, and under the present tariff we cannot begin to compete with them to save our lives. Any gentleman present can buy certain articles in our line in New York which have been imported from England, 10 per cent, cheaper than we can manufacture them. These dealers would prefer to buy of American manufacturers, but they cannot do it because of the difference in price. I think this importer has spent fully $20,000 within the last year in purchasing imported goods; whereas formerly he spent $99 out of every $100 in New York City in purchasing American goods. You may ask why this is so. We have skilled workmen, but the condi- ditions of labor are different. Abroad, the whole family labors, while here it is not the custom to do so. The employes are not willing to live under the same conditions that they do abroad. In this country every laboring man wants to live lixe a gentleman, while abroad he does not have any such expectation. If I should offer to give a man $15 a week for his labor, he would not work, although it would be a higher rate of wages than lie was receiving abroad. We have men coming to us to- day — harness-makers — and they say to us, “We would like to have you make us bits and stamp them ‘Daniels’”. Why do they do this? Because, although the goods are made in this country, and they are satisfied with them, yet they want the stamp of a foreign manufacturer upon them. This is a great drawback to our business. M. S. KERRIGAN.] MOROCCO, 383 M. S. KEEEIGAN. Long Branch, N. J., August 10, 1882. Mr. M. S. Kerrigan, of New York, chairman of the executive com- mittee of the Morocco Manufacturers’ National Exchange, made the fol- lowing statement : Mr. President and Gentlemen of the Tariff Commission: The executive committee of the Morocco Manufacturers’ National Ex- change, being the duly authorized representatives of the morocco man- ufacturing interest of the United States, respectfully ask your consider- ation of the following facts in relation to our interest as affected by the present tariff. Under the act of 1872, entitled “An act to reduce the duties on im- ports and internal taxes,” occurs this paragraph : On bend or belting leather and on Spanish or other leather, 15 per centum ad valo- rem. On calf-skins , fanned, or tanned and finished, 25 per centum ad valorem. On up- per leather of all other kinds, not herein otherwise provided for, 20 per centum ad valorem. On all skins for morocco, tanned, hut unfinished, 10 per centum ad valorem. The exceptional character of this discrimination between tanned and finished morocco will be apparent to any one who will examine the schedule of duties upon other kinds of leather. While we acknowledge that the manufacturers of calf-skins are en- titled to protection equally with us, we see no just reason' why a dis- crimination should be made against us, as the extent of business and number of establishments and hands employed in each industry is nearly equal, morocco predominating about 10 per cent. We claim and request that the duty on “goat and sheet) skins, tanned, or tanned and finished,” be placed at the same rate as now levied on calf-skins, viz: 25 per cent, ad valorem ; and that “on all skins for morocco, tanned but unfinished, the duty also be placed at 25 per cent, ad valorem.” There are about one hundred and twenty -five establishments engaged in the manufacture of goat and sheep skins into morocco leather in this country, employing a capital of about $10,000,000, giving employment to about 12,000 operatives, and the value of whose combined produc- tion amounts to over $30,000,000 annually. Since the passage of the act of 1872, which reduced the duty on all skins for morocco tanned, but unfinished, to 10 per cent., the imports of these skins into this country have increased between 400 and 500 per cent., as shown by the records of the Bureau of Statistics. A very large proportion of these skins for morocco tanned, but unfinished, probably 95 per cent., is brought here from the East Indies, where they are tanned very cheaply with native gambier. The raw stock goes into the hands of English capitalists in Calcutta and Madras, who have built large factories employing Sepoy labor, which is among the cheapest known, averaging for this class of labor only 10 cents per day. These skins, as brought here tanned, are for many purposes virtually finished, and for any purpose for which they are used here require but little labor. A comparison of the rates of wages in tue United States with those paid in Great Britain, France, and Germany, prepared by Hon. Josej)h Nimmo, jr., and read last spring before the Senate committee, 384 TARIFF ■ COMMISSION. [M. 8. KKItRIGAN. shows that leather dressers or finishers are paid 35^ per cent, more in the United States than in Great Britain, 66| more per cent, than in France, and 93§ per cent, more than in Germany. East India produces the largest number of goats of any country in the world, as shown by the accompanying diagram of the “Live Stock of the World,” compiled from the latest census of the various countries by Mr. Noreross, of the Shoe and Leather Reporter. It is considered as accurate as any compilation of the kind can be; it is there shown that the production in India of goats is 20,000,000, an excess over any other country of 13,500,000. The present duty upon these skins, tanned by the cheap labor of India, is so low that, notwithstanding the raw skins are free, there is more profit to the Calcutta merchants to export to this country the skins tanned. A serious additional injury is caused to our trade by the fact that the inferior or rejected skins are sent here, the best being selected for tan- ning in India. Consequent upon such selection the quality, of India goods sent to this country in the raw state has been so poor for the past few years that in many cases they have been almost worthless to those manufacturers who buy the raw skins and convert them into the finished goat and kid morocco, which are such important materials in the man- ufacture of ladies’ and children’s shoes in this country. In conclusion, we ask that the clause in the law be made to read: “On calf, goat, and sheep skius, tanned, or tanned and dressed, and on all skins for morocco tanned, but unfinished, 25 per cent, ad valorem. ARCHIBALD M. HOWtt.J METAL SHEATHING. 385 ARCHIBALD M. HOWE. Long Branch, K J., August 10, 1882. Mr. Archibald M. Howe, of Boston, Mass., attorney for the yellow- metal sheathing manufacturers, made the following statement: Gentlemen of the Commission : I desire to make a brief prelimi- nary statement in introducing the representatives of the yellow-metal sheathing manufacturers. This industry is confined- to the common wealth of Massachusetts, so far as I have been able to learn. There are but four corporations which make this product. It is a compound of copper and spelter, composed of six parts of copper and four parts of spelter, and it is used, I believe, almost exclusively on the bottoms of vessels. This product originated with a Mr. Muntz, an Englishman, some forty years ago, and very shortly after his compound had been successful in England the manufacture of it was begun in this country , and without any protection whatever. Our manufacturers did a good business in yellow-metal sheathing for about twenty to twenty-five years. Of course our business is dependent largely on the shipping- interest, therefore we have to come before you, stating, as briefly as we may, our connection and relation to ship-builders and ship-owners. The law which alfects our case seriously, and which has led us to come before you, and before Congress for the last ten years (for we have appeared there before the Committee on Ways and Means and various other committees since 1872), is a portion of the tariff act of June, 1872, which resulted from the investigation of navigation interests by Hon. John Lynch’s Congressional committee, which made their report in Eebruary, 1870. That act was subsequently interpreted by the United States Treasury Department to our disadvantage, and, as we believe, contrary to the intention of the law. The Treasury Department ruling- becoming a law by the act of February, 1875, placed our product on the list of articles to be taxed a definite sum, and the result is being taxed very heavily, and also being discriminated against by this law of 1872, which was in behalf of the shipbuilder, and which allowed the remission of duties on these particular articles, we are placed between two fires. My client, Mr. Samuel T. Snow, the treasurer of the Revere Copper Com- pany, who has this matter very much at heart and is thoroughly familiar with it, will speak more in detail than I can. We merely ask you to con- sider our case as one that neither affects the question of a high protective tariff or a low protective tariff* or free trade. W e merely wish to be put in the same category with every other material that is used in ship building, as we view it, and as Mr. Lynch’s committee viewed it. As far as our interests are concerned we think that legislation can be had which will give us proper protection without interfering with the interests of any other manufacturer. I have had personal conferences with members of the Forty-sixth Congress at various times, and also with gentlemen H. Mis. 6 25 386 TARIFF COMMISSION. f ARCHIBALD Jl. HOWIt. representing the Lake Superior mining interests and Maine interests, and know their views upon these questions, and that they do not oppose our claim. The bill we presented to the House was projected upon it and passed through the efforts of Mr. Frye, of Maine, who, as the Com- mission well know, is interested in shipbuilding. So that we feel that we come here as business men having no contest with anybody, but occu- pying a position where we can claim the same protection as is now given to the producers of other materials used in the construction of ships. SAMUEL BRACE.] SADDLERY HARDWARE. 387 * SAMUEL BBACE. Long Branch, N. J., August 10, 1882. Air. Samuel Brace, representing the firm of O. B. North & Go., of New Haven, Conn., manufacturers of saddlery hardware, made the following statement : The time given us for preparation since the notice reached us of your willingness to hear our statements has been very short, and we have not access in New Haven to the statistics that it would be desirable for us to lay before you. But I will occupy a few moments in stating such facts as occur to me on this subject. One thing is quite certain, that the amount invested in the manufacture of saddlery hardware in this coun try is large. The business represents a capital of many millions of dol- lars, and necessarily we employ a large number of workmen. Our in- vestments in this business have been wholly made because of the pro- tection we have received under the present tariff. A large portion of the money now employed in the manufacture of our goods has been invested during the last few years, in consequence of the continuance of the pre- sent tariff, and under the abiding faith we have had that it would still be maintained. Our confidence in the continuance or increase of these tariff duties has been so great that we have not hesitated to invest money sufficient to enable us to supply the wants of our own country in this department. At the same time, as already stated by Mr. Litchford, the margin of profit is very close indeed, owing to the importation of these goods from abroad. This importation continues at the present time, and I think the only reason why it has not increased of late is that foreign manufacturers have been led to believe that the policy of this govern- ment was to protect the interests of the manufacturers here. Although it might be to the advantage of English manufacturers, even under the present tariff, to flood this country with their goods in the belief that they could overcome and drive out the manufacturers here, they have not been led to do it because they believe the policy of this government is to protect our home industries. Let our tariff decline even five per cent., or let the English and Germans see that there is a tendency to- wards free trade, and immediately they would perceive that it was a wise investment for them to put their goods into this country, even at cost price, until they could control the market and shut up our manu- factories here and prevent competition. The 35 per cent, duty at present existing on imported goods does not represent the actual difference in the price of labor and wages paid in England and America. Statistics on this subject can be best obtained from those who have practical knowledge of the work done in the shops. A foreman whom we had emjdoyed a number of years, and who was quite familiar with our business, had occasion to take employment in a factory in England. He became very thoroughly conversant with their operations there, and he tells me that the work on these goods is done by workmen in English factories at a price so much lower than the price paid here, that it is equivalent to the amount of duty imposed on the imported article. Further than that, a number of the articles supplied by our trade are 388 TARIFF COMMISSION. [SAMUEL BRACE. made in England by people who live in garrets. Our goods do not require complicated machinery in their manufacture. We have many machines, but they are simple and cheap in construction, and the English laborer can have these little machines in his garret and put his wife and his children of eight or ten years of age to work on these goods. A very large share of the work is done in that way. In this country the conditions of labor are different. Instead of put- ting children at work in manufactories, as is done in England, they are sent to school. This is one of the reasons why the Englishman can manufacture at a much lower price than we in this country can. It is utterly impossible for us to attempt to compete with such labor as they employ. It is my opinion that even a slight reduction in the present tariff on the goods imported in our line would result in closing the most of our factories. There is another consideration besides. Sot only is the price of American labor higher, but our money is more valuable ; interest on money in this country is much greater than in England, and it is in greater demand. So that our investment of money is made at a sacrifice in the rate of interest, because the rate here is so much higher than it is there. The manufacturers have, of course, been protected under the present tariff, to a considerable extent, and the business has been built up and our money has been mostly invested in it within the last few years. But, on the other hand, have the people who use the articles we make suffered in any way? It is a very common belief that if this 35 per cent, tariff was taken off the foreign article the har- ness maker of this country would get his trimmings 35 per cent, cheaper than he does now. But if we look at the history of tariff legislation, we shall see that that is not to be expected. Before the present tariff was adopted, and when the duties were lower than they are now, English goods were sold in this country at a vastly higher price than they are selling for to-day. The effect of a higher tariff has not been to increase the price of these goods to the consumer. They are delivered to the harness -maker in all parts of the United States to-day cheaper than ever before. The pres- ent tariff, although it gives us a close margin on which to compete with the English manufacturer, has not been such as to euable our manufact- urers to produce their goods at a high profit. The profit on saddlery hardware to-day in this country is less than it is on any other class of manufactured iron goods, and the home competition is so close and severe that there is no danger that any tariff will cause the prices of these goods to be any higher than they should be. All the skill and ingenuity of active, earnest manufacturers in this country, who are engaged in this line of business, is in the direction of a reduction of price, and these goods are put on the market to-day at a mere nominal profit to the man- ufacturer. So that no one is suffering in any respect on account of the present tariff, while, on the other hand, it would be very easy for this Commission, by recommending a reduction in the tariff on our goods, to blot us out of existence effectually $ and the moment the English man- ufacturers saw a tendency in that direction they would have every mo- tive to induce them to put their goods here at even the cost price. There is another fact to be taken into consideration, and that is, that the freight from England on these goods is very light. They are brought in sailing vessels, and they can deliver them in New Orleans cheaper than we can our own goods. It is only at a few ports in the immediate vicinity of our manufacture that we have any advantage over the English manufacturer in the matter of freight. SAMUEL BRACE.] SADDLERY HARDWARE. 389 By Commissioner Garland: Question. What is the number of factories engaged in the manu- facure of saddlery hardware in this country? — Answer. 'That is a diffi- cult question to answer. There are quite a number of manufacturers of general hardware who have taken different articles belonging to saddlery hardware and added them to their stock. The number of fac- tories engaged exclusively in manufacturing saddlery hardware, I pre- sume, is 50 or 60 altogether. That is rather an estimate of my own, however, than actual knowledge. Q. What amount of capital is invested in the business, according to the best information you have? — A. At a rough estimate, I should say in the neighborhood of $10,000,000, possibly more. .There is more capital actually invested in the business than is represented by the manufacturers of these goods. Q. Can you give me an idea of the number of operatives employed in your business? — A. 1 should not be able to give you the number with a sufficient degree of accuracy to make it of value to you. 31)0 TARIFF COMMISSION. f IfF.N'RY HERRMANN. HENRY HERRMANN. Long Branch, N. J., August 10, 1882. Mr. Henry Herrmann, of the lirm of H. Herrmann, Sternbach & Co., of New York , importers of dry goods, made the following statement: I desire to state that I have been engaged in the importation of dry goods to this country for nearly a third of a century, and I think I can say that I know from practical experience the difficulties under which the government and the importers labor. I heard the question asked by one of tlie*Commissioners to-day, as to whether there is a difference in the valuation of the same goods at different ports. I can state from my own knowledge that there is such a difference. I know that goods have been imported into Milwaukee and Cincinnati, that have only paid a duty of 35 per cent., while we have paid in New York on the same class of goods a duty of nearly 90 to 100 per cent. By Commissioner Ambler : Question. Do you mean by that that the goods were wrongly classi- fied? — Answer. They were not classified at all; they were put under the 35 per cent, clause. I know these facts that I have stated from my own personal knowledge. I think these internal ports should be done away with, and that there would be less fraud if they were abolished. There is less fraud attempted in Philadelphia, New York, and Baltimore, than in these interior centers, where appraisers are ap- pointed who do not know the difference between cotton and silk, or linens and wool; that is to say, they have no actual experience in those matters. If the Commission desire to ask me any questions in regard to this matter I shall be happy to answer them. JOHN L. GWIN'NELL.J SADDLERY HARDWARE. 391 JOHN L. GWINNELL. Long Branch, N. J., August 10, 1882. Mr. John L. Gwinnell, representing Peter Hayden, of New York, manufacturer of saddlery hardware, made the following statement : I occupy a somewhat different position from the gentlemen who have already addressed you on this subject, in this respect. We are importers as well as manufacturers of saddlery hardware. If we consulted simply our own personal interests, so far as our Newark manufactory is con cerned, we should be in favor of abolishing or lowering the present tariff on these imported goods, because we could make more money by im- porting the goods than we could by manufacturing them, in case the tariff should be removed or reduced, for it would open a very wide door, and the business of importation would be largely increased in this country. But our interest does not lie that way, properly considered, because this particular factory represents only a minimum part of our business. We have manufactories at Auburn, N. Y., Columbus, Ohio, Newark, N. J., and are interested in factories at other places as well ; and the house I represent feels that its interest would be subserved if the present tariff should stand where it is to-day, for the reasons as- signed, and for other reasons which could be mentioned. As remarked by Mr. Brace, the present tariff, although regarded by some persons as too high upon our class of goods, has not had the effect of increasing the price of the manufactured article in this country. I think I am safe in saying that the goods we manufacture were never sold at so low a price or presented to the public at so cheap a rate as at the present time, without exception, not even when the tariff was much lower than it is to-day. You may ask how that can be so. The answer is, simply because the cost of manufacturing the goods has been greatly lessened by the introduction of machinery, and the great competition which exists between the manufacturers in this country has tended greatly to lower the selling price. Competition is so close that it has really driven out all the profit there is in the business, so that at present, with the low prices prevailing, the interest on the capital in- vested is very small indeed. Our experience leads us to this conclusion, that if the tariff* was low- ered we could import largely many kinds of goods in our line which now we are prohibited from importing, owing to the existing tariff. The principal goods imported to-day are specialties. The American manu- facturer is endeavoring, as rapidly as he can, to produce these special- ties here, and we are gradually learning to manufacture some goods of that kind. But the moment we have our tariff lowered, if it should be lowered, we should be unable to continue that. I might, if it would not occupy too much of your time, give you one single item as an illus- tration of what the general result would be. Every gentleman present knows, probably, what a harness-buckle is ; he has seen it upon harnesses. If we introduce to-day a brass harness-buckle made in England, the price, with the duty added and the expenses of importation, would make it cost us about $2.40 per gross to lay it down in America. The Arneri can manufacturer last year, when we received what we supposed was a 392 TARIFF COMMISSION. [JOHN L. GWINNELL. fair compensation for our labor, and nothing but a fair compensation, presented these same goods to the trade at $3.30 a gross. But with only a fair profit to the American manufacturer, the importer was able, as you see at a glance, to import them and undersell us. To-day we are" selling these goods at less than $3.30, so as to keep the importer out of our market if we can. I could illustrate this subject still further by giving you facts in re- gard to the manufacture of a bit. We could go to work to-day and make what we would call a common polished bit, and lay it down in this market, with the present existing duty, for $2.59 per dozen. With a fair profit, and only a living profit, we are forced to ask the trade for the same bit $2.89. We are not getting $2.89 to-day, because we desire to prevent the importation of these goods and are selling them at a lower figure. But the inference I wish to draw from this is, that if you lower the tariff it enables the foreign manufacturer to import the article at a still lower price, and thus prevents the American manufacturer, who can hardly sustain himself under the present tariff, from being able to sustain himself at all. Last year, when there was a boom in the prices of all kinds of metal, the prices of saddlery hardware goods went up, and the English im- porters began to bring in goods in much larger quantities than had been done for years. A large variety of articles in our line were imported into this country. The article of roller buckles, used largely in the West and South in the manufacture of harness, would afford another illustration of this sub- ject. We imported roller buckles largely last year, because the advance in iron and other materials was such that the saddlery-hardware trade put prices up and made a much better profit, I believe, than they were able to make before or since, owing to the competition which exists. As I have said, the lowering of the duty would open the door very widely to the importation of all classes of English goods. Some 10 or 15 years ago there was a very great change made in the styles of saddlery-hard- ware manufactures. New styles were introduced, and this gave us, for the time being, a good market. At present all these new styles, upon which we spent so much money and time, hoping to be able to make a little money from them, are imitated by the English manufacturers, and they are able to produce many of them to-day at prices which cannot be competed with in this country. To-day there are large quantities of English goods being imported into this country. The English manu- facturers are sending out their traveling agents all through the United States, endeavoring to increase their business. There is one concern — Messrs. Owen & Co., of Birmingham — which within the last three months has sent an agent to this country, who will visit all our leading cities from New York to San Francisco, and he is offering these same goods very cheaply indeed — many of them at prices much lower than we are able to offer them to the trade. * I might relate another instance showing just what the foreign manu- facturer is attempting to do in this country. A newspaper was sent to me from Elmira, N. Y., and in it I found an article, filling a quarter of a page or so, in which it was stated that Weeden & Son, harness makers at Elmira, had a large quantity of saddlery goods on hand, which the public were invited to examine, imported from Messrs. Fair- banks & Co.’s manufactory at Walsall, England. Fairbanks & Co. have an office in Montreal, Canada, and for two or three months in the year their agents come to New York to dispose of their goods; and when they find they cannot sell to the New York trade, they travel through- JOiLN L. GW1NNELL.] SADDLERY HARDWARE. 393 out the State selling to the smaller customers. So that to-day these importers’ names are better known among the retail trade than the names of our own manufacturers. I think when the Commission comes to consider all the interests in- volved, and notices the present depressed condition of the trade, it will be convinced that it would be an error to lower the present tariff on these goods. Nevertheless, I think the tariff might be, to a certain extent, equalized. For instance, the duty on general saddlery hardware is 35 per cent. On specialties, such as steel bits, and a variety of goods in the steel line, it is 40 per cent. You will find that serge lias to pay a duty of 45 to 50 per cent. Some items like these might possibly be equalized somewhat ; but taking the duty as a whole, I think it would be very severe on the manufacturers to put it even 5 per cent, below the present rate. These bits 1 have referred to, paying 35 per cent, duty, cost $2.59 to make and put upon the market here ; and if you make the duty 25 per cent, they could be imported for $2.31 per dozen. There is just one single item that I wish to refer to in addition to what I have already said, as it shows one of the advantages that the English market has over ours. During the last year there were about 20,000 pounds of copper sent out of this country by the copper mines, at a price about 5 cents a pound less than we can go in the market and buy it for to-day. It was sent over to England with the positive understanding that it should not be brought back here again in that form. This gave them an advantage of 5 cents a pound on the material they used ^ and it went into articles of brass which they made out of this copper. Again, nickel is used very largely by manufacturers of saddlery hardware. We make many nickel-plated goods. Every bit of nickel that comes into this country has a 30 per cent, duty added to it; consequently Wharton & Co., of Philadelphia, make us pay a pretty good price for the nickel we require in our manufacture. We do not complain of these duties; but it is one of the elements that tend to make our manufactures more expensive, and the carrying on of the business more difficult. We are less able, also, to maintain our competition against the prices that the English manufacturers can produce their goods for. By Commissioner Oliver : Question. Would it be possible to make the duties on this class of goods specific rather than ad valorem? — Answer. I think that would be a very difficult matter. The articles used in the manufacture of saddlery hardware are almost infinite in their number and character. Our business is a comparatively small one compared with some other lines of manufacture in this country, but the articles we use are divided up into a great variety of kinds. It would take this Commission a great while to enumerate them all and fix a duty for each article, even if it had any inclination to undertake such a labor. By Commissioner Garland : Q. Is it your opinion, based on experience, that imported goods are improperly invoiced by the importer? — A. fhave never seen anything to indicate that goods are improperly invoiced; I do not think there is any cause to suspect the importers of undervaluing their goods. 394 TARIFF COMMISSION, [ JOejIAH L1TCHFORP. JOSIAH LTTCHFORD. Lono Branch, N. J., August 10, 1882. Mr. Josiah Litchford, of Buffalo, New York, manufacturer of sad dlery hardware, made the following* statement : Gentlemen of the Tariff Commission : I do not feel prepared to present the claims of the saddlery -hard ware manufacturers to the Com- mission to-day, as the notice given me was very brief and I had not sufficient time for preparation. But I may say in general, that the gen- tlemen with me to-day represent a very large proportion of the manu- facturers of saddlery hardware in the country at the present time. We feel a deep interest in the subject of the tariff, because we have suffered very much in the past from unwise tariff legislation, as we think. I can remember, as a boy, when almost all the saddlery hardware used in this country was imported from England. Even castings were shipped in the rough from England and finished up in this country. But that has ended, and at the present time the importing of English goods has been reduced, owing to the present tariff duties. Yet a large proportion of the goods in our line of business, called common goods, would, no doubt, if even a slight reduction in the present tariff were made, be brought into this country in very great quantities from abroad. / We represent here to day the manufacturers of saddlery hardware. We employ among us a great many workmen who are dependent for their daily bread on the employment we give them in the production of these goods, and we should regard it as a very great misfortune to our business if the present tariff was reduced even five per cent., because it would cause an increase in the importation of foreign goods, our business would be reduced, and a large number of our workmen thrown out of employment. There are in this country a large number of importers whose business it is to import these goods. They buy them from English manufacturers, bring them into New York, Saint Louis, New Orleans, and Cincinnati, and sell them in competition with the goods we manufacture. That is done very largely. If there should be even a slight reduction in the present tariff, of course these goods would be imported to a much greater extent than they are at the present time. I think I speak the unanimous sentiment of all the parties engaged in this branch of business when I say that we desire no change to be made in the present tariff on our class of manufactures, or if there should be a change made, that it should be in the direction of a higher tariff. As I have stated, I do not feel prepared to enter into this sub- ject as fully as I could wish, because 1 have not with me the facts which 1 think necessary to present to your consideration, but I trust that some of the other gentlemen who are with me can present these facts to you more in detail than I have been able to do. L F. JUDD.] SADDLERY HARDWARE. 395 L. F. JUDD. Long Branch, N. J., August 10, 1882. Mr. L. F. Judd, of the iirm of North & Judd, New Britain, Conn., manufacturers of saddlery hardware, made the following* statement : 1 simply desire to say that a year or two ago, happening to he in Eng- land, as a manufacturer of saddlery hardware (which has been my bus- iness for years) I naturally looked into the business as it was carried on there, and in Germany, France, and other countries. While in Eng- land I went to Walsall, which is the great center of the manufacture of saddlery hardware, and having letters of introduction to the largest manufacturers and exporters of these goods I had all the necessary facilities for examining into their manufacture. The manufacturers showed me through their establishments, and almost the first article that I picked up after I went into one of them was a rein-snap, made by North & Co., and called the Andrews rein-snap. I said to them, u Where did you get this V 7 They said, u We have sent one of our men to New York to pick up these things, and whenever there is anything new invented he sends us a sample of it and we make a similar article in this country. We are going to fill Canada with these goods ; we are not going to let your people sell to the Canadians.” I found imitated goods there which had been produced at our factory not six months before. They had procured them through their agent, imitated them, and were going to send them into this country. I in- vestigated their methods of manufacture, and came to the conclusion that we were the originators of most of the improvements made in machinery in this country. These English manufacturers pick up our ideas and send the goods they manufacture into Canada; and if they do not send them into this country we feel quite fortunate. I indorse all that Mr. Gwinnell has said on this subject. We are selling the roller-buckles to-day at a profit of only 3 per cent, on the cost of production. Our factory has made 50,000 gross of them within the last six months, and I do not believe we have made over 3 per cent, on them. If you should take off the small tariff that we now have upon goods in our line, we shall have to stop the manufacture of them, although we have been in this business for forty years. The price of labor is so high in this country that if it were not for a moderate tariff we should not be able to continue the business. 396 TARIFF COMMISSION. [ F. H. CATLIN. F. H. CATLIN. Long Branch, N. J., August 14, 1882. Mr. F. H. Catlin, president of the Northfield Knife Company, North- held, Conn., representing the manufacture of pocket cutlery, made the following statement : I think the gentleman who proceeded me (Mr. Thomas W. Brad- ley) has stated the facts correctly in regard to the difference in the price of cutlery now and ten years ago. Our estimate is that the selling price to-day is fully one-third less than it was ten years ago, and the price is lower than it was twenty-five years ago. He was asked a ques- tion in regard to the gold premium ; whether the price would he less in gold. I have not at present in mind what the amount of premium on gold was in 1872, but I think it was not so large, but that the present price of American pocket cutlery in gold is fully one-third less than it was in 1872. In regard to the figures given in the table presented by us, I will say that they were compiled by the president of our association, Mr. W. F. Kockwell, and that they are taken from actual cost prices, as found on their books on goods of their own manufacture. They have the means and facilities for manufacturing at as low a price as any one in the country. I have been connected with this business about nineteen years, and have been through most of the factories in this country en gaged in this line of business, and my experience is that theirs is the most complete factory in the way of machinery and all the facilities for making goods at low prices. Therefore I think that a statement made from their books is a fairer one than if taken from the books of some other concern where they manufacture on the old plan, but are not able to manufacture as cheaply or economically as Mr. Rockwell’s firm does. We avoided taking our figures from the books of any such firm as that for a basis. By Commissioner McMahon : Question. About how many companies are there in this country en- gaged in the manufacture of pocket cutlery? — Answer. At least twenty- five. Q. How many hands do they employ altogether ? — A. About eighteen hundred. Q. How much money is invested in the plant ? — A. About $1,600,000, as stated in the paper we have presented. Q. That is the amount of capital invested. I want to know how much is invested in the plant, not how much stock you have made. — A. I could not give you that information at present. By Commissioner Porter: Q. Is it not a fact that the annual product of this business is very small compared with the amount of capital invested ? — A. T think it is. I know of no other business in which the annual production is so small in proportion to the capital invested as it is in this. It is a very diffi- cult matter in our business to make the annual production exceed or even equal the capital invested in it, and there are very few companies in this country who have been able to do it, ) EDWARD S. MORRIS.] PALM OIL. 397 EDWARD S. MORRIS. Lonh Branch, N. J., August 14, 1882. Mr. Edward S. Morris, of Philadelphia, resident Liberian consul, addressed the Commission as follows: Gentlemen : Having visited the Christian Republic of Liberia on the west coast of Africa with a view to business in its broadest significa- tion, I think you will be pleased to learn of a new industry I have there inaugurated, viz, the refining of palm oil. I know of no such effort in all Africa. This oil is sent to me in casks for soap-making, and in bot- tles (air-tight) for hospital purposes, as well as for a more perfect soap. No oil is said to have greater healing properties, in cases of wounds and all skin affections, than palm oil. Palm oil is free of duty. Shooks are sent to Liberia, where they are put into casks or hogsheads, to receive the oil. No import duty is charged by the United States uj)on the shooks or casks, but a duty of 30 per cent, is charged upon the bottles. Last year the first importation on record (I believe) of palm oil in bottles was received by me direct from Liberia to the port of New York. I had to pay 30 per cent, duty on the bottles. I did so under protest, and an answer was received by me from the United States Treasury Department at Washington, which you will find printed in “ Synopsis of Decisions,” Nos. 4731 to 5084, p. 206, Treasury Department. You will observe the law as it now stands is substantially as follows: Bottles exported empty and returned empty will be free of import duty under the present statute. All comment is unnecessary, only adding that 1 give Congress credit for appointing a Tariff Commission composed of business men to consider business questions. I have just received from my refinery in Liberia over 7,000 bottles of pure and sweet palm oil. The bottles received by me last year and now were made by Messrs. Whitall & Tatum, of Philadelphia. I am again obliged to pay 30 per cent, duty on American-made bottles, which I do under written protest, useless as it may seem. Continue the present law and I will be driven to England to purchase bottles, and at a price 30 per cent, less than American prices, to say nothing of a weekly transport between England and Liberia. Continue the present law and the United States Government will receive the thanks of bottle-makers in all foreign countries. In the name of bottle and glass manufacturers, I respectfully ask for the present statute to be changed to the end that all American -made bottles shall be free of all duty. If a cask containing palm oil is free of duty, why not an American-made bottle*? By Commissioner Oliver : Question. Are you buying the American-made bottles ? — Answer. Yes, sir. Q. Do they cost you more than the English or French bottles ? — A. Yes, sir. Q. Why, then, do you buy them? — A. Simply because I can get them to Liberia easily in vessels sailing from New York, and I prefer taking the American-made bottles. I think it is better than to get my bottles in England. There they are less in price, and there is communication 398 TARIFF COMMISSION. [EDWAHP S. MORRIS. from England to Liberia almost weekly. But if the duty of 30 per cent, is removed from American-made bottles, I shall continue to get them and send them to my refinery in Liberia. If it remains as it is, it will be cheaper to buy them in England. The collectors of the ports of New York and Philadelphia said they would join me in protesting against paying a duty on American-made bottles. As I have said, if a cask can come in free of duty, why cannot an American bottle? I think it is well to have a duty placed upon bottles made in foreign countries but not on bottles made in America. By Commissioner McMahon : Q. Did you know when you sent out your American-made empty bot- tles that there would be a duty on them on their return? — A. Not when I made my first consignment, but I did when I made my second con- signment. Q. Did you know when you made your second consignment that you could get bottles cheaper from England? — A. I did; but I hoped that the protest, that the collector of the port asked me to write, would be listened to, and that I would get them in free on my importation of 1882. Q. Paragraph No. 1468 of HeyPs Digest reads : American manufactures of casks, barrels, or carboys and otkei vessels, and grain bags, if exported containing American produce, and declaration be made of intent to return the same empty, under such regulations as shall be prescribed by the Secretary of the Treasury. These are admitted free of duty. They are to be exported containing American produce and to be returned empty. It was held in this case that they were not returned in the same condition as when exported. — A. If I had brought them back empty, having sent them out empty, there would have been no duty upon them, of course. Commissioner Oliver. I believe that petroleum barrels come back free of duty. Commissioner McMahon. Yes ; that is under a special act. Para- graph 1487, HeyPs Digest, says : Barrels of American manufacture, exported filled with domestic petroleum and re- turned empty, under ^ucli regulations as the Secretary of Treasury may pi escribe, and without requiring the filing of a declaration at time of export of intent to return the same empty. They are upon the free list. There has been some mistake in the cod- ification of the law. Commissioner Underwood. A bottle sent out empty and returned empty is admitted free of duty ; but when filled with palm oil, which is free of duty, the bottles are charged with a duty. Commissioner McMahon. That is done under paragraph 953, HeyPs Digest, which reads as follows : Glass bottles or jars filled witli articles not otherwise provided for, thirty per centum ad valorem. Palm oil is otherwise provided for. We held in New York that that clause did not cover anything that was provided for, but they held in Washington that it covered everything that was not provided for in a bottle. Commissioner Garland. It is under a construction of the law, then, rather than a special provision of the law itself. The President. The law does not seem. to be clear. The Witness. Nevertheless, 1 have to pay the duty. The collector of the port said that the simple insertion there of the words “American- made bottles ” would cover the difficulty. WIT. F. ROCKWELL.] POCKET CUTLERY. 399 WILLIAM F. ROCKWELL. Lono Branch, N. J., August 14, 1882. Mr. William F. Rockwell, treasurer of the Miller Brothers Cutlery Company, of Meriden, Conn., and president of the American Pocket Cutlery Association, made the following statement: Our story is not a very long* one, and will not occupy much of your valuable time. At a meeting of the American Pocket Cutlery Association, held in New York, August 2, 1882, it was unanimously agreed to respectfully submit for your consideration such changes in the tariff as our experience suggests as more equitable than the present ad valorem duty of 50 per cent. The average cost of material used by us is 20 per cent, of our production, and the balance, 80 per cent., is made up of labor. Our foreign competition comes from both England and Germany. The work in both foreign countries is done largely on the family plan, the cutlery being simply inspected and packed in the warehouse, the workmen usually furnish ing such power, tools, and supplies as are needed. The variety manu- factured both here and abroad is very large, but we submit a printed statement giving a sufficient example of the cost of the leading grades to illustrate the request that you will investigate the propriety of recommending a specific duty of 50 cents per dozen blades, instruments or erasers, and 30 per cent, ad valorem duty. As many foreign manufacturers have a resident partner in this country, it is obvious and admitted that many goods are invoiced and duty paid at the cost of labor and material, while the profit is added in this country. The amount of goods imported during the last year was about $2,000,000, an increase of 50 per cent, in the last three years. The amount manufactured here was about $1,350,000, an increase of not over 25 per cent, during the same time. While the quality of genuine American goods is almost universally conceded to be far superior to the average German and lower grades of English wares, and perhaps equal to the best imported, still the Ameri- can good name has been greatly compromised by foreign manufacturers of low-grade cutlery adopting American patterns and American names, thus bringing an unfair competition on our cutlery that has made the trade devoid of profit. While we have many specially skilled work- men who can earn much more, the average wages paid by us is $2 per day, and we find it difficult to retain good men at that rate, as other branches of industry offer better remuneration. The average wages paid in England is less than one-half, and in Germany less than one-fourth the amount paid by us for the same class of labor. In the table referred to we have given the cost of material, labor, and inci- dental or factory expenses on American goods. We have deducted 35 per cent, (average duty) from the material on foreign imports. We have estimated English skill at one-half, and German labor at one-fourth the rate of our own. I have had printed a statement embodying these facts, which 1 will be happy to furnish to the Commission. It is signed by myself as president of the American Pocket Cutlery Association, by Mr. F. II. Catlin, president Nortlifield Knife Company, Northfield, Conn., and 400 TARIFF COMMISSION. fcWM. F. ROCKWELL. secretary of the association, and by Mr. Thomas W. Bradley, presi- dent of the New York Knife Company, Walden, N. Y., chairman of our executive committee. The following* table shows the relative cost prices of American, English, and German pocket cutlery, with 50 cents per dozen blades specific, and 20 per cent, ad valorem duty added to the foreign goods : GERMAN. Description. Cost of material. Cost of labor. Duty, 50 cents per dozen blades. Duty, 30 per cent, ad valorem. l Total cost. 4§-inch cap primer, one blade, iron lined, wood covering $0 39 $0 53 $0 50 $0 27 $1 69 4-inch, cap pruner, one blade, iron lined, wood covering 35 47 50 25 1 57 4-inch jack-knife, one blade, iron lined, wood covering 24 32 50 16 1 22 4-inch jack-knife, two blades, iron lined, wood covering 33 45 1 00 23 2 01 3f-inch jack-knife, one blade, iron lined, wood covering 21 30 50 15 1 16 3|-inch jack-knife, two blades, iron lined, wood covering 31 42 1 00 22 1 95 3^-inch jack-knife, one blade, iron lined, wood covering I 19 25 50 13 1 07 3|-inch jack-knife, two blades, iron lined, wood covering 27 I 37 1 00 19 1 83 31-incli jack-knife, one blade, iron lined, wood covering ! 17 24 50 12 1 03 26 35 1 00 18 1 79 3 £ -inch penknife, two blades, brass lined, ivorv or stag covering I 38 52 1 00 27 2 17 24 -inch penknife, three blades, brass lined, ivory or stag covering 1 52 1 70 1 50 37 3 09 24 -inch penknife, four blades, brass lined, ivory or stag covering 61 82 2 00 43 3 86 3-inch penknife, two blades, brass lined, ivory or stag covering I 44 60 1 00 30 2 34 3-inch penknife, three blades, brass lined, ivory or stag covering 58 79 1 50 51 3 38 3-inch penkniie, four blades, brass lined, ivorv or stag covering 68 92 2 00 48 4 08 34 -inch penknife, two blades, brass lined, ivory or stag covering 46 64 1 00 33 2 43 34 -inch penknife, three blades, brass lined, ivory or stag covering 63 85 1 50 44 3 42 3Linch penknife, four blades, brass lined, ivory or stag covering. ...... 72 97 2 00 50 4 19 34-inch penknife, three blades, brass lined, pearl covering 2 26 1 54 1 50 1 14 6 44 34 -inch penknife, four blades, brass lined, pearl covering ! 2 37 1 60 2 00 1 19 7 16 3|-inch penknife, three blades, brass lined, pearl covering 1 2 85 1 94 1 50 1 43 7 72 3|-inch penknife, four blades, brass lined, pearl covering. 2 96 2 j)0 2 00 1 48 8 44 ENGLISH. Description. Cost of material. Cost of labor. Duty, 50 cents per dozen blades. | Duty, 30 per cent, ad valorem. ' Total cost. 4§-inch cap pruner, one blade, iron lined, wood coveiing $0 39 $1 07 $0 50 1 $0 43 $2 39 4-inch cap pruner, one blade, iron lined, wood covering 35 93 50 38 2 16 4-inch jack-knife, one blade, iron lined, wood covering 24 64 50 26 1 64 4-inch jack-knife, two blades, iron lined, wood covering 33 91 1 00 37 2 61 3|-inch jack-knife, one blade, iron lined, wood covering 21 59 50 24 1 54 3| inch jack-knife, two blades, iron lined, wood covering 31 84 1 00 34 2 49 3^-inch jack-knife, one blade, iron lined, wood covei ing 19 50 50 21 1 40 3i-inch jack-knife, two blades, iron lined, wood covering 27 73 1 00 30 2 30 3|-inch jack-knife, one blade, iron lined, wood covering 17 47 50 19 1 33 3i-inch jack-knife, two blades, iron lined, wood covering 26 70 1 00 28 2 24 24 -inch penknife, two blades, brass lined, ivory or stag covering 38 1 04 1 00 42 2 84 2|-incli penknife, three blades, brass lined, ivory or stag covering 1 52 1 41 1 50 58 4 01 L’Lincli penknife, four blades, brass lined, ivory or stag covering 61 1 65 | 2 00 67 4 93 3-inch penknife, two blades, brass lined, ivory or stag covering ; 44 1 20 1 00 49 3 13 3-inch penknife, three blades, brass lined, ivory or stag covering 58 1 59 1 50 65 4 32 3-inch penknife, four blades, brass lined, ivory or stag coveiing 68 1 83 2 00 75 5 26 3§-inch penknife, two blades, brass lined, ivory or stag covering 46 1 28 1 00 52 3 26 3|-inch penknife, three blades, brass lined, ivory or stag covering 63 1 69 1 50 70 4 52 3£-inch penknife, four blades, brass lined, ivory or stag covering 72 1 94 2 00 79 5 45 3l-inck penknife, three blades, brass lined, pearl covering 2 26 I 3 07 1 50 1 60 8 43 3^-inch penknife, four blades, brass lined, pearl covering 2 37 1 3 20 2 00 1 67 9 24 35-inch penknife, three blades, brass lined, pearl covering 2 85 * i 3 87 1 50 2 00 10 22 3§-inch penknife, four blades, brass lined, pearl covering 2 96 4 00 2 00 2 08 11 04 W M. F. ROCKWELL.] POCKET CUTLERY. 401 AMERICAN. Description. Cost of material. 1 Cost of labor. Incidental expenses. i Total cost. ; 4g-ineh cap primer, one blade, iron lined, wood covering 4-inch cap pruner, one blade, iron lined, wood covering! 4-inch jack-knife, one blade, iron lined, wood covering $0 53 47 $2 13 ; 1 87 $0 66 58 $3 32 2 92 32 | 1 28 40 2 00 4-inch iack-knife, two blades, iron lined, wood covering 45 1 82 57 2 84 3§-incti jack-knife, one blade, iron lined, wood covering 29 1 18 37 1 84 3J-inch jack knife, two blades, iron lined, wood covering 42 ! 1 68 53 2 63 3^-inch jack knife, one blade, iron lined, wood covering 25 99 31 1 55 3£-inch jack-knife, two blades, iron lined, wood covering 36 1 46 45 2 27 3J-ineli jack-knife, one blade, iron lined, wood covering 31-inch jack knife, two blades, iron lined, wood covering 23 95 29 1 47 35 1 40 43 2 18 2^-inck penknife, two blades, brass lined, ivory or stag covering 52 1 2 07 65 3 24 2|-inch penknife, three blades, brass lined, ivory or stag covering 70 2 82 88 4 40 2|-inch penknife, four blades, brass lined, ivory or stag covering 82 3 29 1 02 5 13 3-inch penknife, two blades, brass lined, ivory or stag covering 59 2 39 74 3 72 3-inch penknife, three blades, brass lined, ivory or stag covering 79 1 3 17 99 4 95 3-inch penknife, four blades, brass lined, ivory or stag covering 92 ! 3 66 1 14 5 72 3^-inch penknife, two blades, brass lined, ivory or stag covering 63 2 55 79 3 97 3^-inch penknife, three blades, brass lined, ivory or stag covering 85 3 38 1 1 05 5 28 34-inch penknife, four blades, brass lined, ivory or stag covering 97 3 87 ; 1 2i 6 05 34-inch penknife, three blades, brass lined, pearl covering 3 06 6 14 2 30 11 50 3|-inch penknife, four blades, brass lined, pearl covering 3 20 6 40 2 40 12 00 3|-inch penknife, three blades, brass lined, pearl covering 3 86 7 74 i 2 90 14 50 3f-inch penknife, four blades, brass lined, pearl covering 4 00 8 00 i 3 00 15 00 I have also the honor of submitting to you a printed statement on this subject, which is entitled “ pocket cutlery notes,” in which a few addi- tional facts are stated. It says : “The average price of pocket cutlery in this country is one-third less than it was ten years ago. Such companies as have made a moderate profit have done so by selling to the smaller trade, or by combining some other branch of industry with the manufacture of pocket cutlery. “ The sale of American fine knives is greatly disproportionate to the whole amount of pocket cutlery consumed. As the labor account in- creases on fine knives, the difference in cost between American and for- eign goods becomes more apparent. Fifty per cent, ad valorem duty upon wages 75 per cent, less than ours, helps but little to lessen the competition between us. “Our workmen are mostly imported. Necessity compels them to buy cheapest food at home ; opportunity enables them to procure the best in this country. Their relative value to American farmers, whether in this country or in Europe, may be fairly represented by the relative prices of the staple items of consumption which are largely exported, to say nothing of the meat, vegetables, milk, &c., which they buy at good prices. “The prices paid in the New York wholesale markets for leading articles of food are as follows: For export, which the same class use in Eu- rope. Best quality, which our men use here. Flour, per barrel $3 50 18 $9 00 35 Butter, per pound Cheese, per pound 12 20 3 80 9 55 3 80 5 73 II. Mis. 6 26 402 TARIFF COMMISSION. [WM, F. ROCKWELL. u Showing a difference of 250 per cent, to encourage the farmer to raise good products for home consumption, and to favor the immigra- tion of well paid mechanics to consume them.” The following is the name and address of companies engaged in the manufacture of pocket cutlery in the United States, August, 1882 : American Knife Company, Thomaston, Conn. American Shear Company, Hotchkissville, Conn. Canastota Knife Company, Canastota, NT. Y. Canton Cuteery Company, Canton, Ohio. Central City Knife Company, Phoenix, N. Y. Carter & Johnston, Akron, Ohio. Empire Knife Company, West Winsted, Conn. Excelsior Knife Company, Torrington, Conn. Eayetteville Knife Company, Fayetteville, N. Y. Erary Cutlery Company, Bridgeport, Conn. Gardner Manufacturing Company, Shelburne Falls, Mass. Holley Manufacturing Company, Lakeville, Conn. Humason & Beckley Manufacturing Company, New Britain, Conn. John Russell Cutlery Company, Turner’s Falls, Mass. The Miller Bros. Cutlery Company, Meriden, Conn. Naugatuck Cutlery Company, Naugatuck, Conn. New York Knife Company, Walden, N. Y. Northfield Knife Company, Northfield, Conn. Southington Cutlery Company, Southington, Conn. Ulster Knife Company, Ellenville, N. Y. Union Knife Company, Naugatuck, Conn. Walden Knife Company, Walden, N. Y. Waterbury Knife Company, Waterbury, Conn. Waterville Cutlery Company, Waterville, Conn. W r 0LFERTz, C. F., & Company, Allentown, Pa. Beaver Falls Cutlery Company, Beaver Falls, Pa. The amount of capital invested in the business is $1,600,000; the value of goods produced last year was $1,350,000; the number of per- sons employed about 1,800, and the average wages paid per day was $2. I should be glad to answer any questions that any member of the Commission desires to put to me. By Commissioner McMahon : Question. You have stated that many foreign manufacturers have a resident partner in this country, and that goods are invoiced and the duty paid a t the cost of labor and material, and the profit added in this coun- try. Will you give the names of some of those manufacturers ? — An- swer. They have been given to me at different times in a confidential manner. Q. Are they leading manufacturers ? — A. Yes, sir, they are. Q. Are the manufacturers you refer to English manufacturers — Rog- ers & Co.? — A. No, sir; I think not. Q. Or George Wostenhohn? — No, sir. Q. Are they manufacturers who make a good many goods for this market? — A. Yes, sir; they make many goods tor this market. Q. Did the custom house officers, who are bound by their oaths and by the law to appraise goods at the actual wholesale cost or market POCKET CUTLERY. WM. F. ROCKWELL.] 403 value, know this, so far as you are aware ? — A. I never brought it to their attention. Q. Then you assume that they are either ignorant of the fact or derelict in their duty ? — A. I would say that they were ignorant of it. Q. Did you ever hear of a Mr. McMullen, who is in the appraiser’s office at New York ? — A. I have heard of him. These matters of which I have spoken came out in conversation. I have an acquaintance with many German manufacturers, and in conversation these facts have been stated to me in a social way. Q. But you have put that statement here in a printed form. — A. Yes, sir ; I have. The President. Are there any of your associates who desire to address the Commission ? The Witness. I believe so. The President. We want to get all the facts which you desire to present, and as completely as possible. The Witness. I think we have had more trouble with goods made from American patterns sent abroad and stamped with the name of an American manufacturer than from any other source. By Commissioner McMahon: Q. Then, if your trade-marks were protected by act of Congress, the same as the American trade-marks on watches are already protected, would that be protection enough for you? — A. No, sir; and that is not the point under discussion. These foreign manufacturers put the stamp of American manufacturers on their goods, and they are sold as Ameri- can cutlery, and that brings of course a direct competition with German goods which are manufactured to compete with us under American names. Q. Suppose that Congress should prohibit the admission to entry of foreign made cutlery stamped with an American name, would that pro- tect you sufficiently without any other protection except in regard to the matter of undervaluation spoken of in your statement? — A. Prob- ably it would, so far as the undervaluation is concerned. Q. But that is not my question. My question is a double one. If you are first protected against undervaluation by a better appraisement of the wholesale market value, and, secondly, by prohibiting the intro- duction of foreign goods under American names or trade-marks, would that be sufficient to protect you? — A. I think the protection of a specific duty is a better protection, and that a better appraisement can be made under it than under an ad valorem system. I think specific protection in our line of business is much better than ad valorem protection. Q. Do you think an appraising officer can estimate the value of goods any more closely and correctly when they pay a duty of 30 per cent, ad valorem than if they paid a duty of 50 per cent, ad valorem? — A. I do not think any appraising officer can estimate the actual value of cutlery very accurately by looking at it. Q. Can anybody do so? — A. Yes, sir, I think so; if they take it out and examine every parcel, they might. But then they must judge whether it comes from England or not, and put their appraising value on it. By Commissioner Kenner : Q. When you sign this paper as president, do you sign as president of one of these companies or as president of an association having the same object in view? — A. I sign it personally, as a member of the firm of Miller Bros. & Co., and also as president of the American Pocket 404 TARIFF COMMISSION. [WM. F. ROCKWELL. Cutlery Association. The paper was prepared at a meeting of the American Pocket Cutlery Association. Q. As president of that association, and speaking in its behalf, it is presumed that you have information which justifies you in saying that you have a moral conviction that “it is obvious and admitted that many goods are invoiced and duty paid, at the cost of labor and material, while the profit is added in this country.” — A. Yes, sir. Q. Acknowledging that responsibility and speaking for a large num- ber of people, you state that emphatically? — A. Yes, sir; I state it emphatically. I might qualify it with this additional statement. Dur- ing the last two or three years I have had frequent conversations with German manufacturers, men who manufacture goods in Germany and spend part of their time in this country and part in Germany, and they said that it had been done, and was customary. Q. Did they tell you it was done in Germany or did they confine their assertions to a particular country, such as France or England ? — A. They said it was done in Germany and that the other countries did the same. Q. And the parties whom you got that information from impressed your mind with the moral conviction of its truth? — A. Yes, sir; and that was done long before the appointment of this Tariff Commission. By Commissioner Oliver : Q. Why do you recommend that a specific duty be put on blades ; would it not be simpler to make it on the article itself? — A. A specific duty would be more simple on the whole business if we were allowed to figure it out, but it would be cumbersome. The blade is identical in all knives, but the covering, or handle, is different. Some handles are made of pearl and some of cocoa, &c. So that the blade is the only thing by which you can arrive at the true value, for it is a piece of steel by itself and is of identically the same value per blade whether in a one- bladed or four-bladed knife. Q. In adding an ad valorem duty, you get the increased cost of cov- ering and finishing. Suppose the duty was made on so many .dozen knives or instruments? — A. There are combination knives which have a large number of blades. Some knives are made with saws, &c., in them, and that is done to cover them all. Q. It is simply to place the duty upon the article when it is finished and ready for consumption. — A. That could be done, but while it would be just at one end of the line, perhaps it would not be sufficient at the other, or it might be too high in one case. A two-bladed jack-knite might be worth $2.50, while a pearl-handled knife might be worth $G. By Commissioner McMahon: Q. Do you mean that scissors shall pay 50 cents per dozen and 30 per cent, ad valorem duty? — A. Yes; scissors in a knife. We make combination knives with scissors in them and with saws in them, &c. Q. Then you mean per dozen blades, instruments, or erasers in one handle?— Yes, sir; that is the idea. Q. Do you mean by dozens all the different articles that are in one handle ? — A. Yes, sir. Q. If a knife comes in with a spaying blade, saw, an eraser, a nail- cleaner, a tooth-pick, and other articles, and there was a dozen pieces altogether in an instrument of that kind, including the blades, you would charge 50 cents on one dozen of that article complete; is that the idea ? — A. Yes, sir. Q. Suppose an article comes in, and in one handle there is contained a dozen instruments, how much does that pay; 50 cents? — A. Yes, sir; WM. F. ROCKWELL.] POCKET CUTLERY. 405 take a one-bladed knife (all knives are sold by tlie dozen), and it will have one dozen blades in the package, which will be a duty of 50 cents. If it is a two-bladed knife, there would be two dozen blades in a package, and the duty would be $1. If it is a three-bladed knife, there would be three dozen blades in the package, and the duty would be $1.50. In regard to the capital invested in our plant, I would say that our company has as large a plant as any other conrpany interested in the manufacture of pocket cutlery. The firm I represent, the Miller Bros. Cutlery Com pan y, of Meriden, Conn., was started in 1869 or 1870, with the intention of manufacturing pocket cutlery on an improved plan. Mr. Wostenholm himself took $10,000 worth of stock, and there was $100,000 of capital invested, and subsequently $50,000 more was put into the business. They put in improved machinery and continued the business until 1873, when they had to stop, having sunk $400,000 in the business. At that time a party of us bought out the business. The machinery was estimated at $100,000, and the building account stood at $50,000, making a total of $150,000 at that time for the conducting of the business in the making of pocket cutlery. We bought the estab- lishment five or six years ago, a gentleman who was interested with me having ample means to carry it on. Of course we bought the plant at a low figure, and we have put in every known improvement in ma- chinery, and the figures I have submitted are the actual figures that we pay for the manufacture of certain classes of knives. Our books will show the labor and the material employed, and these figures have been collated in the most careful manner from the books of Miller Bros. & Co. I know that the different plants throughout the country have costa large per cent, more than is invested in almost any other business in proportion to the production. Our production is less than $150,000 a year on a plant valued at $200,000. We have spared no expense to make the business a success and to find out if there is any T money to be made in it. So far as the matter of stamping of American names on foreign pocket cutlery is concerned, it is only mentioned here incidentally to show why we need specific protection on cutlery, and not because we are asking to have it prohibited. 406 TARIFF COMMISSION. [THOMAS W. BRADLEY. THOMAS W. BRADLEY. Long Branch, K. J., August 14, 1882. Mr. TnoMAS W. Bradley, president of the iiew York Knife Com- pany, of Walden, Kew York, made the following statement: The principal point to which I desire to call the attention of the Commission is the one in regard to the importing of foreign goods, par- ticularly German goods stamped with American names. By that I do not mean that they import goods stamped with the same name of the firm manufacturing goods in this country, but only with some name akin to it. For instance, I am connected with the Kew York Knife Com- pany, a firm which has been in existence since 1852. We claim to make a good quality of knife, like the English knife, to compete with the Ger- man production. We meet in the market a brand of goods stamped the a Kew England Knife Company.” The inference in the trade is that it is the same class of goods as ours. These goods are German goods of a very cheap class and a jmor quality of steel, but they are put in compe- tition with our steel by reason of the use of the words “Yew England Knife Company,” and the trade infer that they are manufactured in Kew England by American makers. In that way our goods are degraded by reason of the importation from Germany of knives of that description. There are many instances of that kind where different brands are used. We would like to have that business stopped if we could. Take this knife that I hold in my hand. It is an imported German knife of good finish and appearance, and, to the appraiser in Kew York, appears pretty much of equal value with ours; but the difference is in the quality of steel used. The finish is nice and the workmanship fair, but the quality of the knife is not within 25 per cent, of our home-made knife. If you bring in a Wostenholm or a Rogers knife, we know it at once ; there are no better goods made in the world. The aim of the American manufac- turer is to compete with the Rogers and Wostenholm goods. It is an honorable aim, and one that we have endeavored to follow for many years. I have been engaged in the manufacture of cutlery since 1 was eleven years of age. My father before me was in the same business for twenty-five years, and his father was also a cutler. We come directly from Sheffield, the home of the cutlery business, and we undertake to compete with the goods manufactured by Crooks, Wostenholm, and Rog- ers, which everybody acknowledges to be of the very best quality of goods. So far as they are concerned, we can at any time equal them in finish. In material Ave do equal them, because we use the same steel that they use. We import it. But before many years I think we shall be able to use American steel. We are making experiments in that direction at present, and in the common grades of knives use American steel to-day. We are improving all the time, and I think in a few years we shall have American steel equal to the best English steel. Fifteen to twenty years ago all the steel we used for pocket cutlery we imported from Sheffield direct ; but, as I say, we are gradually substituting American steel for the English steel. The name of Wostenholm or Rogers gives the article a reputation which is equal to 25 or 30 per cent, profit over the ordinary manufacture, THOMAS W. BRADLEY.] POCKET CUTLERY. 407 independent of the quality of the goods; that is to say, their name is worth that percentage. But these German goods we cannot compete with. 1 have here a. knife which we sell for $12 a dozen. It cost the New York Knife Company $12.75 a dozen to make it. You may ask why we make it at a loss. We make it and sell it as an advertisement, because if we were not putting this class of goods on the market we could not make a reputation for producing a good quality of goods. At the same time, knives of German manufacture can be put on the market at $10.40 a dozen and give a good profit. The tariff has been our salvation heretofore. The present tariff was framed toward the latter part of the war, and it enabled struggling con- cerns nearly bankrupt, as we were ourselves, to build up the business and make it a profitable industry. At present we employ 200 men in the manu- facture of pocket cutlery, and the whole business was built up during the war at the time when gold was up to $2.88 premium. That fact helped us to build up the industry. But for the last ten or twelve years it has been a very hard struggle for us to make a living out of the business ; it has not been profitable at all. It has been a struggle to come out even and to keep our factories and machinery in a fair state of repair. The reduction of the premium on gold of course reduced our advan- tages under the tariff to that extent. As against the better class of English goods, the present tariff is a good fair protection, but the Ger- man manufacturers, as the tariff stands, can very largely undersell us. As regards the subject of undervaluations, I will say this: VCe have dealings with importers and become socially friendly, and we get points from them as to what is paid by them for labor, &c. We de- rive much information of that kind from gentlemen on the other side of the water. I, myself, was born in Sheffield, and when I visit there I pick up a great deal of information in regard to wages and prices of goods. Besides, we have had to send over for several operatives, and of course they have information on these points also. We are gradu- ally bringing in American youths to learn our business. Some of the best mechanics we have are Americans who have grown up in the bus- iness, and have been engaged in it since they were boys. But it is necessary for us to bring some of our operatives from the old country. In a few years I think we shall outgrow that, as we are now introduc- ing machinery to take the place of hand labor. Our business is a com- plicated one, and it takes several years to learn the different portions of it. If we are fairly assisted by a judicious tariff for eight or ten years, I think we shall obtain a firm footing in this country. By Commissioner McMahon: Question. Did you ever hear of an American manufacturer of pocket cutlery putting on his wares names similar to the names of Eogers and Wostenholm ? — Answer. No, sir; I never knew of such a case. I know of cases where American manufacturers have been asked to do so, but in all cases they have refused. Q. Do you know that there are German goods which come into our market which imitate the better grades of English goods, where they use a deceiving term as to trade marks 1 ? — A. I do not know absolutely of a case. When Mr. Wostenholm was living, he came to this country, about eight years ago, and his principal business at that time was to prosecute a paity who was stamping “Wostenholm & Sons” on some German goods. I do not know who made the goods. Mr. Wostenholm was a guest at our house for a time, and he told me that was his business. Q. Then there was one instance, at least, where the best English 408 TARIFF COMMISSION. [THOMAS W. BRADLEY. manufacturers have to complain of the same thing you complain of? — A. Yes, sir. Q. It has been stated that the price of cutlery is about two thirds what it was ten years ago. Is it not two-thirds less than the gold price? — A. That I cannot answer. Our sales have always been made in currency. Q. Have you ever notified the custom-house officers of your knowl- edge of undervaluations ou the part of importers ? — A. No, sir; because I never have had any personal knowledge which I could supplement by a sworn statement. By Commissioner Kenner : Q. However, you have signed this paper, and in that paper you state as to these undervaluations. Are you satisfied of the correctness of that statement ? — A. I am satisfied of the correctues of it from in- formation derived from the president of our manufacturers’ association. Q. Are you aware of the fact that it is not within our province to recommend any law to Congress preventing the foreigner from stamp- ing his goods with any name that he sees fit to put upon them? You complain that some parties stamp on their knives the words “New En- gland Knife Co.,” which resembles your stamp, the u New York Knife Co.” Ho you suppose Congress could pass a law which would have any effect on that ? — A. I think it would have an effect if Congress should pass such a law, but whether they could do it or not, I couldn’t say. It is done on a grade of goods acknowledged to be of a lower grade than the American manufacture, made over in Germany and coming into this country with a duty not sufficient to bring them up to our price. That is the reason I suggested that a specific duty in connection with an ad valorem duty should be placed on the goods. For instance, a Rogers knife costs $12 a dozen to import to this country, while a German knife of similar appearance can be imported for $8. If the duty was put on, as has been suggested, at 50 cents a dozen blades, the German knife would pay nearer the amount of duty paid on the English knife,* and that would equalize it somewhat. Q. Suppose the inferior German knife was stamped the “New York Manufacturing Co.,” lor instance. Ho you imagine any law of Congress could prevent that being done? — A. No, sir; but I think that if we could get a specific duty it would partly remedy the evil. By Commissioner Oliver: Q. You have stated that Mr. Wostenholm visited this country for the purpose of prosecuting parties who were stamping inferior goods with the name of “Wostenholm & Sons.” You say that you found some goods stamped in that way. Was that done by American manufac- turers ?— A. No, sir. Q. Were the goods made in America? — A. No, sir. Q. Where were they made? — A. 1 think in Germany. Q. Who had been doing this stamping, the importers or the German manufacturers? — A. The German manufacturers, I think. Q. Then it was a similar case to your own which you complain of? — A. Yes, sir. FREDERICK B. HAWLEY.] SCIENTIFIC PROTECTION. 409 FREDERICK B. HAWLEY. Long Branch, N. J., August 14, 1882. Mr. Frederick B. Hawley, of New York, addressed the Commis- sion as follows : Mr. President and Gentlemen of the Tariff Commission: You have been appointed in order that our present tariff laws might receive from you a more discriminating and scientific consideration than could be well given to them by Congress; and you are authorized to submit an advisory report, as to what changes in these laws are just and desirable. Your object is to determine, as nearly as ascertainable facts, and reasoning founded upon such facts, will allow, which of our national industries can be artificially fostered to the benefit, not so much of those engaged in such industries as to the enrichment of our wliole population. 1 do not understand that you are expected to consider the advisa- bility of a protective policy, but rather liow such a policy can be wisely applied. An argument in its favor is not therefore entitled to any special consideration from you, unless it affords economic principles which will aid you in its practical application to the subjects under discussion. The only theoretical principles of interest to you in your corporate capacity are such as are capable of indicating, in each indi- vidual instance, the gain or loss that arises from that special industry being protected. I think you will agree with me that none of the arguments commonly advanced in favor of protection possess the scientific precision that will enable you to properly utilize the statistics at your command. None of them are capable of yielding any formula that can be practically applied to the resolution of the difficult and complicated problems you are expected to solve. Without some such formula, it is impossible for the most critical and accurate investigation to arrive at any but empir- ical results. But the social and economic effects of a protective tariff* are altogether too complicated for empirical results to possess the least value in what is your especial duty, the determination of particular cases. Of all this you are doubtless aware; indeed, two members of your Commission have substantially stated the same to me personally. You will not accuse me therefore of too strong a statement when I affirm that the very first requisite to the success of your efforts is the discov- ery of some such formula, based upon undeniable scientific truth, and its consistent application and use in your investigations. It is because 1 have such a formula to propose to you that I venture to obtrude my views upon your consideration. It is an unpleasant task to do so, because it is an ungraceful, and somewhat immodest, thing for an author to dilate in person upon ideas already published to the world. It is wiser and in better taste for him to let his work speak for itself, in the certainty that, if worthy of it, it will finally win approba- tion and consent. In my case, however, my book has not been published for a sufficient length of time for any decisive verdict to be pronounced upon the principles it contains; and those principles, if correct, are so essential to your success that I hope to be pardoned for any apparent egotism. When it is remembered that ftliat you are appointed to deter- 410 TARIFF COMMISSION. [FREDERICK B. HAWLEY. mine and recommend can only be ascertained with the aid of such a formula as I am about to present to you, and that no other formula has ever been proposed, I have, I hope, established a claim to a very careful consideration of my views, especially as I am able to state that what criticism my treatise has recived has been unexpectedly favorable. I do not propose a full presentation of my argument; that can be found in my book, “Capital and Population,” more fully elaborated than would be possible in the limited time at my command. What I desire to do to-day is to indicate how the economic principles there es- tablished can be applied to the resolution of the special questions that will come before your Commission. It will only be necessary to state here that the economic law I have enunciated is simply this: that there is a persistent tendency for capital to press upon its limits, which are acknowledged by all economists to be population and the state of the arts That is, a community cannot continue its accumulation of capital beyond the amount that can be profitably utilized in the em- ployment of its labor. To allow of any permanent addition to this amount, there must be au increase in the number of laborers, or there must occur a diversion of some of its labor from industries using little to those able to utilize a greater amount of capital, in proportion to the labor employed. For if, without either of these contingencies happen- ing, a further addition is made to capital, i. c., to the funds actively en- gaged in or reserved for productive employment, the competition of such capital lowers the rate of profit ; and as profit is the sole induce- ment to produce, it also lessens the industrial activity, amount of em- ployment, and total production of the nation. It follows from this that any policy which opens up new avenues for investment, by sustaining the rate of profit and the amount of employment and productive effici- ency, allows such accumulations, as the new investments justify, to be saved from the products of labor that would not otherwise have been employed at all. Considered from a national point of view, such ac- cumulations are a saving from what would otherwise be wasted. . The profits which they afford are wholly an addition to national income, when such diversion of industry arises from natural causes. When, however, they are the artificial result of a protective policy, a price is paid for the benefit derived, namely, the additional cost to the consumer of the protected article. This loss to the consumer may be greater, equal to, or less than the gain to the producer. There is no invariable relation between the two sums. The amounts of each can, however, be quite accurately ascertained and compared for each protected industry. Free-traders claim that to ascertain the loss or gain to the commun- ity on any protected article, the money cost at which it could be im- ported must be compared with the money cost at which it is produced and sold at home. It is needless to say that this comparison invariably indicates a loss; and as needless to assert that the principles upon which it is founded ignore the fact that the amount of capital a nation can and will accumulate depends wholly upon the nature and require- ments of its industries. If they are such as will enable a large capital to be profitably employed, there need be no fear but that the capital required will shortly be present to fulfil its mission. Production and accumulation may safely be trusted to go on, as long as the promise or hope of profit remains. This being so, to enable us to determine the loss or gain due to the protection of any specified industry, we have only to compare the im- ported cost of the commodity produced with the money value of tbe agricultural products which the diverted labor might have produced. The result will be an accurate determination of the gain or loss of pro- FREDERICK B. HAWLEY.] SCIENTIFIC PROTECTION. 411 tecting such industry, except as the result is modified by the fact that the money cost of imported commodities, duty free, would have been greater, and the money price of exported commodities lower, under tree trade. This result follows from the action of the economic law known as “The Equation of International Demand,” and is acknowl- edged by all free-traders of any scientific standing, though few of them recognize the importance of the admission. Whatever its influence is, however, it is wholly an addition to the gain, or a subtraction from the loss, due to protection, as ascertained by the above comparison. With this very imperfect statement of the scientific principles in volved, I ask your attention to their practical application, which I will illustrate by an attempt to ascertain the gain or loss that has accrued to the community from the protected industry to the cotton manufact- ure. The first point to be determined for the consideration of this, as for all other protected industries, is the money value of the product of an average day’s work of an ordinary laborer, when employed on the poor- est land that can be profitably cultivated. This product will be divided between the laborer w 7 ho lias produced it and the farmer who has em- ployed him. As the land under consideration bears no rent, none of it goes to the landlord. The laborer’s share is well known, being what is called the price of common day labor. Its average throughout the United States is about $1.25 per day where steady employment is given. As the capital employed in farming, exclusive, of course, of the value of the land, is not very large, an addition of 20 per cent, to the laborer’s wages will perhaps cover the remuneration of the farmer. We cannot be more than a few cents out of the way in assuming that a common agricultural laborer on the average produces a total value of about $1.50 per diem. Turning now to the Census Deport Statistics of Manufactures for various cities, June 1, 1879, to May 31, 1880, let us ascertain what value labor produces in the manufacture of cotton goods. These statistics are not, of course, such as you, with your greater facilities, w ould use, but I have availed myself of them for the purpose of illustration, as being those on which I could most readily lay my hands. They show the results only of such part of the cotton manufact- ure as is carried on in the cities named. As, however, it cannot be supposed that there is any great advantage or disadvantage in city as compared with country factories, the result arrived at through these statistics can differ to no great extent from that obtainable from the statistics of the whole industry. Statistical table of cotton manufacture. N ame of city. Men, sixteen years and over em- ployed. Women, above fifteen years em- ployed. | Children employed. 1 1 H Value of material. Value of products. 1 Boston 64 145 80 $74, 200 $389, 000 $550, 000 Cincinnati 103 275 20 99, 147 298, 405 684, 158 Newark 305 894 155 433, 955 545, 402 1,598,397 Philadelphia 4, 033 5, 541 1,880 3, 440,440 9, 020, 672 16, 349, 238 Providence 524 1, 020 202 420, 242 1, 025, 57 1 2, 004, 788 Sa nt Louis 1 10 171 163 80, 325 318,156 453, 295 New York 140 104 52 96, 704 337, 188 532, 512 5, 279 8, 150 2, 558 4, 657,013 11,940,514 22, 172,418 412 TARIFF COMMISSION. [FREDERICK B. KAWLEY. Employed in agriculture we find that the above labor would have pro- duced the following value: 5,279 men, 300 days, at $1.25 $2, 076, 625 8, 150 women, of whom not over one-quarter would have been productively engaged in agriculture, or 2,038; 300 days, at say two-thirds men’s wages, or 83£ cents 509,400 2,558 male and female children, of whom half or 1,278 would have been em- ployed at say 300 days, at 50 cents 191, 700 2, 777, 824 To this amount are to be added the profits of the farmers, which at 20 cents on the above sum equal 555,565 Also cost of the material used in the cotton manufacture, as above 11, 940, 514 This gives - 15,273,903 as the real cost to the country of the products of the cotton factories in these seven cities, and which products were sold by them for $22,172,418. From this real cost, however, there are several deductions to be made. First. Some of the supplies and materials used by this manufacture are protected, and higher in price on that account. If the protection afforded is wise, as it probably is, this higher price is no detriment to the country, and must be deducted from the real cost. What this really amounts to, can be ascertained by you. I can only estimate it, which I will do at 5 per cent, of the material consumed, which amount will not seem large when it is remembered how considerable a proportion of the cotton yarn woven in Philadelphia is not spun there, but in innumerable small yarn mills scattered throughout the country. At 5 per cent, the amount of this deduction will be $597,025. Second. If the above laborers had been engaged in agriculture, they could only have been employed in the cultivation of poorer lands than those now tilled. And the same is true of all other laborers in protected industries. This w-ould have lowered what economists call the margin of cultivation ; and, as this margin is the only determinant of the money wages of unskilled labor, and the main determinant of real wages, .both money and real wages would have been lowered also. That is, if our leg- islators had allowed the United States to remain as it was, a purely agricultural country, and our population had attained its present num- bers, the laborers now employed in manufacturing could not have found as good land to work upon as the poorest now in use. The land they would have been obliged to cultivate would be more sterile by a very considerable percentage, probably by at least 10 per cent. That is to say, that, supposing the poorest land that can be now cultivated with jrnofit to yield ten bushels to the acre, wages would be lowered to the point at which nine bushels would afford a profit to the farmer. What deduction should be made on this account from the above real cost can only be approximated. The statistics by which it could be accurately ascertained do not exist. I am, however, undoubtedly within the limit, in my assumption that protection has raised the American margin of cultivation 10 per cent, and in deducting $333,339 from above real cost. Third. A further deduction must be made on account of the detri- mental action of the Equation of International Demand upon an agricul- tural country, which result is rectified and perhaps more than rectified by protection. This is a very intricate subject, and I cannot pursue it here. That protection does have this beneficial effect is denied by no one that I know of. What the amount of this effect may be can only be approximated and that not very closely. If we assume that the prices of exportable articles would be 5 per cent, lower, and of imported ar- FREDERICK B. HAWLEY.] SCIENTIFIC PROTECTION. 413 tides (duty unpaid) 5 per cent, higher, under free trade, and that the gross sum of imports and exports were doubled, a gross sum not far perhaps from the real one, could be ascertained, which would express the gross saving to the county afforded by the action of protection upon the Equation of International Demand. I am certainly within the limit in assuming that the proportion of this gross sum that should be cred- ited to the industry we are considering is double that to be attributed to the raising of the margin of cultivation. I will deduct therefore from the total of real cost the sum of $666,678. Fourthly. I have shown in my book that there is a tendency for an agricultural country to borrow a larger proportion of its capital than a manufacturing one. The interest on this excess is a drain upon national income that can be saved by protection. Its amount is uncertain and not verv large. I will subtract, therefore, only the sum of $100,000 from the above figures on this account. Deducting these four sums, which you, with your greater facilities, could approximate much more nearly than I have been able to do, we find that the real cost to the nation of the cotton goods manufactured in these seven cities is only $13,576,761. I think you will agree with me that the more accurate determination of this real cost, that would result from your investigations, would be under rather than over the amount I have obtained. The final step of the process I am advocating remains to be taken. This real cost of $13,576,761 is to be compared with the amount in dol- lars and cents which a similar amount and quality of foreign goods could have been imported for, duty free, during the year from June 1, 1879, to May 31, 1880. The result will show the exact gain to the community of protecting the factories, whose returns I have availed myself of. What this inqiorted cost would have been can be accurately ascertained by you, as the necessary statistics and price-currents are in existence and can be gathered together. In the case of this manufacture, it would not, however, be necessary, as the imported cost is manifestly much greater than the real cost to this country. For, assuming that the cost of the raw material would be the same to England as to ourselves, if that country sold us these goods at their present real cost to ns, she would only have been able, after entirely sacrificing the profits of her manufacturers, to pay the labor which produced the goods $1,636,247, or about 35 per cent, of the sum our manufacturers paid their hands. The cost of the raw material would probably have been somewhat greater to her, as the freight on the cotton imported and the goods exported would more than balance any advantage in the smaller cost of the other materials used. The above figures also indicate that in the year 1879-’80 England should have been able to undersell our cotton manufacturers by over 39 per cent., before we suffered any loss in protecting that industry. I do not know how the prices of cotton goods in England compared with those that obtained in America during that period. I cannot make this comparison, which proper inquiry would enable you to make. As- suming such prices delivered in America to be 19 per cent, lower than ours — and this cannot be far from the truth — the protection of that industry yielded a profit to the community of 20 per cent, of the goods produced. If it be objected here, that the four deductions from real cost I have made partake too much of the unreliability of all estimates, the reply is that they do not greatly affect the final result. Leaving them out entirely, the percentage by which English spinners should undersell 414 TARIFF COMMISSION. [FREDERICK B. HAWLEY. ours only falls from 39 per cent, to 31 per cent. The principles on which these deductions are founded cannot, I think, be intelligently disputed, and their amount is of sufficient importance to be carefully considered and estimated, but they are by no means essential to the formula here presented. Going entirely to one side of the account, the position of an industry that shows a profit independent of them is only strength- ened by bringing them into the calculation. It is only those protected industries, that otherwise show a small balance of loss, that need to lean upon these estimated quantities for justification. If, gentlemen, I shall be able to impress my views upon you suffi- ciently to lead you to adopt the formula carried out in the above illus- tration as your method of investigation, it will become your duty to determine, as accurately as you can, the following general and special facts : GENERAL FACTS. First. The money value at present prices of the product of the yearly labor of a common agricultural laborer employed on lands that pay no rent. Second. The percentage by which that product would probably be reduced by the lowering of our margin of cultivation, that would result if the labor at present employed in protected industries should be ap- plied’ to the cultivation of the soil. Third. The percentage by which the money price of our exportable products would probably be reduced, and the price of our imports be raised, together with the probable increase in the total amount of our foreign trade that would result from our becoming a purely agricultural community. These general facts would apply to your calculations concerning all jHOtected industries. In addition you will need to ascertain for each separate industry that claims protection the following SPECIAL FACTS. First. The amount of labor it employs that in the absence of such em- ployment would be utilized in agriculture. Second. The gross value of the raw material consumed, less the amount of such value due to some of the articles used being protected. Third. At what money cost a similar amount and quality of products could be imported free of duty. Extreme accuracy in ascertaining these facts, however desirable, is by no means essential. All of the larger and most of the smaller branches of industry, now protected by our laws, will show such a balance of profit to the nation as to stop all dispute as to the accuracy of your re- sults. It is only in doubtful cases, in which the interests involved are not large, that greater accuracy than the means of investigation at your command will allow, is called for, and this statistical labor can in great measure supply in the future. You have not the time, of course, to determine the necessary special facts for each separate protected industry ; but you have it in your power to do a much greater thing, namely, to settle, definitely and forever, the principles involved. The rest is matter of detail, which can be safely left to lower and less valuable abilities than yours. You can ascertain by statistics and estimates the general facts involved, and you can ap- ply them to the more important of our industrial interests. Granting FREDERICK B. HAWLEY.] SCIENTIFIC PROTECTION. 415 the correctness of the principles I have laid before yon, they widen and dignify the scope of your labors, and give you the opportunity of ren- dering an inestimable service both to science and to the nation. And now, gentlemen, m closing, let me ask you to notice that a re- port from you, founded upon the assertion that our protected industries allow of a greater accumulation of capitalized wealth than the indus- tries in which our people would be engaged under a free-trade regime, and upon a comparison of what the nation now produces, with what it would produce if it employed its protected artisan labor in agriculture, will commend itself to the common sense of the people, This line of argument can be understood and appreciated by the ordinary as well as by the scientific intellect. It is in your pow er to command the essen- tial facts and statistics. Most of them can be derived from the census reports, and w r here these fail you, they can be supplied by the different trade associations or even by individual manufacturers. The elements of the calculation you will be obliged to estimate are susceptible of ap- proximation sufficiently close to allow of a definite determination in all but a very few r cases. Isolated facts are useless for your purposes. They must be brought into connection to be of value. They can only be brought into connection by the adoption of some method of investi- gation. I am not aware of any other method than the one here advocated that has ever been, or can be, proposed. That the economic principles I have enunciated are thus capable of practical application, is of itself a strong verification of their truth. If, having satisfied yourselves of their validity, you adopt the method of investigation they indicate, you will be able to discriminate justly between the different industrial inter- ests that appear before you; enforcing the claims of those, to aid which will subserve the interests of the community, and answering the clamor of others, whose demands are unreasonable, with a mathematical demon- stration that they should not be granted what they ask. And, lastly, you will settle once and forever the abstract question of free trade and protection, and you will settle it in a manner peculiarly gratifying to the American people, by demonstrating that the instinct which lias guided them in their industrial policy was founded upon scientific truth. 416 TARIFF COMMISSION. [H. veron. H. VERON. Long Branch, N. J., August 15, 1882. Mr. H. Veron, secretary and treasurer of the Brick Enameling Com- pany, of Philadelphia, made the following statement: We are manufacturers of enameled bricks. We take the red pressed brick and enamel it; that is, we enhance its value from $22 a thousand as a red pressed brick to $05 a thousand for enameled edges, $85 a thousand for edge and end brick, and $105 a thousand for flat brick. The articles which we use in this enameling process are all of them chemicals imported into this country. We are now interfered with con- siderably by the importation of an English glazed brick which is brought into the market and sold as enameled brick. I have with me a sample piece of our own manufacture which I had ground off so as to be able to show you the quality of goods which we make. This is one of the five colors we manufacture. This English brick that is imported is nothing but a glazed brick, with thin light colors put on an ordinary fire brick. This brick here [exhibiting] which we manufacture is enameled. If you want to break the enamel you have to break the brick. But you can take these glazed bricks that are imported from England, and pick off the glazing almost with your finger. They manufacture this brick and bring it into this market and profess to sell it at from $85 to $100, and down to $70 or $45 per thousand. Wherever they find us offering our brick in New York or elsewhere, they put the price of their brick down as low as $45. They have no duty to pay except a duty of 20 per cent, on common or fire brick. This is an ornamental brick, entirely, orna- mental; and all the enameling compounds used in it are dutiable goods. What we seek is to get a duty of 40 per cent, at least, the same as is imposed on glazed goods. By Commissioner Oliver: Question. Is the manufacture of this class of goods increasing? — Answer. Yes, sir; the manufacture is increasing, and the article is get- ting to be much better known throughout the whole of the United States. Formerly we were confined in our sales to the East, but now we are get- ting orders from Minnesota and other Western States. Our price for the brick includes their delivery on board the cars ready for shipping. The English bring their bricks into New York harbor and deliver them as low as $45 a thousand. They do not produce a better article, as is frequently the case in imported goods, but they produce an inferior article to our own manufacture. They glaze a fire brick which will absorb all the moisture and frost, and everything of that liind. I am told by experts that under certain variations of heat or cold this Eng- lish brick will burst. By Commissioner Boteler : Q. How many establishments are there in this country for the manu- facture of this kind of enameled brick? — A. Ours is the only one in the United States. Q. Wliat is the amount of capital invested in the business ? — A. It is about $100,000. H. VEBON.] ENAMELED BRICKS. 417 Q. What number of hands do you employ? — A. When we are run- ning our works we employ usually from 30 to 40 hands, depending upon how fast we are running. By Commissioner Oliver : Q. You have had a difficult time in introducing this manufacture, have you not? — A. Yes, sir; we have had a great deal of trouble. By Commissioner Boteler : Q. What is the annual product of your establishment ; how many thousand brick do you produce per annum? — A. We enameled last year between 350,000 and 400,000 bricks. Q. How long has your establishment been in operation? — A. We have been in existence about six years, but we have not been running the whole of that time steadily; only just enough to supply the require- ments of the trade. It has been up -hill work with us. By Commissioner Kenner : Q. Where does the demand for this enameled, brick come from; what parts of the country use it ? — A. It is used in the different States for out- side and inside work. A great many of them are sold in Yew York and Philadelphia. I could show you some large fronts in Philadelphia, 36 to 40 feet wide, where they have been used. There is a five-story build- ing right opposite the Quaker burying-ground where they are used, and the Girard Life Insurance Company on Chestnut street have used them in the front of their building. We have also supplied the Sailors’ Snug Harbor at Staten Island with a number of thousand; they have used 64,000 to 65,000, I think, for inside work. It is an excellent thing for hospitals, and is used also for arches. It is used in the public buildings in Philadelphia for arches. Many people use them for linings to stables. Q. Is it used on account of the increased durability of the brick, or simply on account of its ornamental appearance? — A. Partly on account of the increased durability, because these bricks when once put into a front require no painting or anything of that kind. The rain will wash them off clean, and they absorb no moisture, and will last for a lifetime. Our bricks are more dense than the English brick. Where the English bricks would be crushed by the weight, our bricks would stand the pressure. Ours is the regular red pressed brick. Q. What would be the effect in case of fire ; would they resist the action of fire better than the ordinary brick ? — A. The action of fire directly upon the enamel might have a tendency to crack it in case a building should be burned; but it will stand the same amount of heat that any first-class pressed brick will stand. In the preparation of these bricks they are put through the regular potter’s white heat. By Commissioner Oliver : Q. I understood you to state that the present duty on enameled brick is just the same as it is on common brick? — A. Yes, sir. Q. What are common brick worth to-day per thousand in New York or Philadelphia ? — A. Pressed brick, such as we enamel, are worth $22 a thousand, I believe. Q. What are your enameled brick worth? — A. On edges, $65 per thousand; edge and end, $85; flat, $105. Q. You ask that a higher rate of duty shall be put upon the imported article ; have you made any specific recommendation in our schedule ? — A. Yes, sir; we make a recommendation of 40 per cent., the same duty that is put on glazed goods. H. Mis. 6 27 418 TARIFF COMMISSION. [H. VEBON. Q. Can you make that duty specific instead of ad valorem ; that is to say, by the thousand ; would not that be the better way ? — A. I think it would. By Commissioner McMahon : Q. You make a distinction between glazed brick and enameled brick? — A. Yes, sir. Q. Which costs the most, to enamel a brick or to glaze it? — A. En- ameling costs the most. I am told by our men at the works, who are familiar with the subject, that these English glazed goods are merely washed with the preparation that is put on the bricks. But enameling, as you will observe, is a complete covering to the brick, and is solid. Q. Then your complaint is that these English glazed bricks come in here, and that they are sold and used in the place of your enameled bricks? — A. Yes, sir. Q. Why don’t you glaze bricks, then, instead of enameling them ? — A. Because our customers object to it, and say that it is not a brick which will give satisfaction. Q. Still these English bricks come in here and give satisfaction ; at least they undersell you? — A. These bricks require the test of several years before their quality can be fully ascertained, and no doubt the inferiority of English goods will be discovered before a great while. Q. What is the cost of glazing the common brick ; does it double the cost of the brick? — A. It increases the cost considerably, but I could not say exactly how much at present. Q. Do you know whether it doubles the cost or not? — A. I do not know, but I presume it does. Q. If it does double it, then you get double the duty on a glazed brick that you do on a common brick; that is to say, if it is double the value it makes the duty double? — A. You must recollect, however, that glazed bricks come in and are sold as enameled bricks. Q. But the duty is 20 per cent, on the common brick, and 20 per cent, ad valorem on the glazed brick ; therefore the duty on the glazed brick is double? — A. I do not know what these goods are got through the custom-house for. I endeavored to ascertain the value, but I could not. I can only judge from the prices at which they sell them. Q. You found out that they were admitted at 20 £>er cent, ad valorem duty? — A. The tariff law requires that, but I do not know what the val- uation is that they put on them. I have never made any glazed brick, and therefore I could not state with any positiveness as to the cost of them. But I am told by our men who manufacture them, that the glazed brick are much inferior to our enameled brick. I do not think it is a fair compeition when they can bring in an article, which after a few years’ use will prove to be a much inferior product to ours, undersell us, and do it in a bold and defiant manner. They go to men who are negotiating with us for our brick, and use all sorts of means to undersell us in price, besides making unfair statements in regard to our produc- tions. By the President: Q. Has the glazed brick the same external appearance as the enameled brick? — A. It has a glossy look, but you can see that the substance is not there; it is thin. It is put on white fire brick, a porous article, while our enamel is put on a red clay brick. GEORGE W. JEWETT. ] appraiser’s department, n. y. 419 GEORGE W. JEWETT. LoNGr Branch, N. J., August 15, 1882. Dr. Georg-e W. Jewett, examiner, appraiser’s office, New York custom-house, made the following; statement: I would say generally, in regard to the division with which 1 am con- nected, that of drugs and chemicals, that there are many articles under the head of Sundries, which I think could be stricken out judiciously and included elsewhere. Under the head of Schedule M, Sundries par- agraph 1181, you will notice a variety of acetates charged at different rates of duty. The section provides as follows: Ammonia, twenty-five cents per pound ; baryta, twenty-five, cents per pound; cop- per, ten cents per pound; iron, twenty-five cents per pound; lead, brown, five cents per pound ; white, ten cents per pound ; lime, twenty-five per centum ad valorem ; magnesia, fifty cents per pound; potassa, twenty-five cents per pound; soda, twenty- five cents per pound; strontia, twenty-five cents per pound; zinc, twenty-five cents per pound. I do not know any good reason why these articles should not all be put under one general classification of chemical salts not otherwise provided for at 20 per cent, ad valorem. 1 do not see any use in men- tioning forty articles by name when they could go in one general list, and the matter could be simplified in that way, especially as the amount of duties collected is small. In paragraph 1182 you will see there is a great variety of acids provi- ded for. 1 think you could put all acids under two classes, one of acids used for medicinal purposes, and another class used for manufacturing or chemical purposes, or in the fine arts, making the latter free, or put- ting them at whatever rate you thought proper. I would also like to call your attention to paragraph 1187, alum ; and to paragraph 1188, ammonia. I do not see any reason for mentioning these various articles under different paragraphs, and think it would be well to let them go under the chemical-salt list. They could be classi tied as chemical salts not otherwise provided for. Paragraph 1190, antimony, crude, and regulus of, should be taken in connection with para- graph 1470, which provides for antimony ore and crude sulpliuret of; they should be taken together. Commissioner Kenner. The last paragraph you have quoted from is under the free list. The Witness. Yes, sir. One paragraph says “antimony, crude, and regulus of: ten per centum ad valorem;” and the other paragraph says, “antimony ore, and crude sulphuret of,” free. The distinction we make is, that the crude is the ore as mined from the mine, while the crude antimony of commerce is smelted and brought here in a crude state; and our decision and rulings on this point have been upheld. But 1 think this matter should be simplified by saying “antimony ore, free,” and “crude antimony and regulus of, ten percent.” Make them all free or all dutiable. I have referred you to these sections to show you how they conflict w ith each other ; you can construe them either way. Commissioner McMahon. 1 wish you would go back to paragraph 420 TARIFF COMMISSION. [GEORGE \V. JEWETT. 1188 while you are on that subject. Ammonia under that paragraph is rated at 20 per cent, ad valorem, is it not ? The Witness. Yes, sir. Commissioner McMahon. Now turn to paragraph 1469. It says there, u ammonia, crude, free,” does it not"? The Witness. Yes, sir. In point of fact there is no such thing as crude ammonia ; that is a physical impossibility. It is one of the in- consistencies of the tariff. Section 1203, benzoates, might be changed. It is a matter of very small account ; and so far as the duty is concerned does not amount to anything. Benzoates for medicinal use are charged 40 per cent, under the general clause ; but otherwise, 30 per cent. It is the action of acid on a salt; benzoate of copper, and other kinds. Some of them are used in chemistry, some in the arts, and in laboratories. By the President : Question. Wliat change do you recommend? — Answer. I should leave it out entirely here, because then it would come in under one or the other of the other classes. I am in favor of simplification in the tariff, and 1 would obliterate more than half of these clauses because they are mere repetitions. Section 1262 says, u Drugs, medicinal and other, crude, not otherwise provided for : twenty per centum ad valorem.” Yow, in the free list, section 1594, it is provided as follows : “ Flowers, leaves, plants, roots, barks, and seeds, for medicinal purposes, in a crude state, not other- wise provided for.” The evident intention of this clause was to cover everything in a crude state that belonged to a plant — any part of the plant, from the root to the leaf, which was medicinal — and to have it come in free. But the other section, Yo. 1262, says, u Drugs, medicinal and other, crude, not otherwise provided for: twenty per centum ad valorem.” It seems to me that that could be stricken out very well. For instance, lupuline of hops is neither a bark, a seed, leaf, nor a root. The President. It is a gum. The Witness. Yes, sir ; for certain purposes it may be considered a gum. We pass that at 20 per cent., and yet it is part of a plant. But I think if the whole plant is admitted free, a part of it ought to be ad- mitted free. I have contrasted these two sections to give you an idea of the way they conflict. I would strike out paragraph 1262. Paragraph 1268 relates to rum essence or oil, and bay rum essence or oil, 50 cents an ounce. Compare that with paragraph 1345 which pro- vides for essence of oil of bay leaves at $17.50 per pound. We have got that matter partially adjusted by a decision ; but the law stands there the same. Essential oil and bay-rum oil are the same thing, but the rate of duty is quite different. It seems to me that the duty on cologne water, provided for in paragraph 1268, and other perfumery of which alcohol forms the principal ingredient, and which now pays a duty of $3 a gallon and 50 per centum ad valorem, should be amended in some way. That tax of $3 a gallon was put on alcoholic perfumery at the time when alcohol was paying $3 a gallon duty, in order to prevent fraud in getting it in at 50 per cent, duty as perfumery, and redistilling it to avoid the rate of $3 a gallon on alcohol. That is the reason that rate was put on perfumery. Subsequently the rate on alcohol came down to $2 a gallon, but the rate on perfumery has never been brought down to the rate on alcohol, and I think it ought to be done. Paragraph 1333 relates to u mercurial preparations not otherwise provided for, 20 per centum ad valorem.” There is one mercurial prep- aration, calomel, which is provided for specifically at 30 per centum. C5HORGS w. jf.wrtt.] APPRAISER'S DEPARTMENT, N. Y. 421 I would strike out paragraph 1333, and let the articles named go with the general provision for medicnial salts or chemical preparations aecorb- ing to circumstances. I do not see any good reason why that should be singled out for a smaller rate of duty than is put On other medicinal preparations. Paragraph 1335, mineral kerines, could be done away with ; it is nothing but a chemical salt. One portion of paragraph 1182, acids, I overlooked, and I wish to call your attention to it. You will find in that paragraph that tannic acid pays a duty at the rate of $1 a pound. In paragraph 1434, tannin is provided for at $2 a pound. They are identically the same thing. The correct designation is tannic acid. Paragraph NTo. 1436 provides for tartar emetic at 15 cents per pound. That would properly come under my suggestion of having two general classifications: Chemical salts, 20 per cent . 5 medicinal preparations, 40 per cent., paying 20 or 40 per cent., as might be determined upon. This paragraph could be done away with. Paragraph 1449 provides for white vitriol, or sulphate of zinc, 20 per centum ad valorem. I do not see any good reason why that should be mentioned specifically ; it could come under a general clause, and would simplify the matter very much. The same in regard to blue vitriol. Commissiones McMahon. Is it produced in this country to any con- siderable extent? The Witness. Yes; the most of these articles are produced here. All the fine chemicals used for medicine and in the laboratories and colleges are made in this country. The manufacture of chemicals here has increased wonderfully of late. In regard to the free list, I would say, generally, that there are many articles named under it where it is entirely unnecessary, and there are many repetitions. Por instance, barks and roots are on the free list. But I will first take up the subject of acids, in paragraph 1454, which provides for “all acids of every description used for chemical and man- ufacturing purposes.” The class of acids I spoke of under paragraph 1182 provides for “all other acids of every description used for me- dicinal purposes or in the fine arts.” I would leave out the words “ or in the fine arts,” because that properly comes under the chemical and manufacturing clause, and make both free, or both 10 per cent., accord- ing to circumstances. Paragraph 1455 provides for aconite root, leaf, and bark. That ought to be left out, as it is provided for under the general clause 1594. Para- graph 1460 provides for alkanet root; that should be left out. Para- graphs 1460 to 1470 should be left out, in my judgment, because they are all covered by the general provisions under paragraph 1594. Commissioner Oliver. Your aim is simplicity. You have been working at this matter and you understand it clearly. But it might be some other official would not understand it as well as you do, and in that event would it not be well to leave in these articles by name instead of putting them all under the general clause as you suggest? Commissioner McMahon. They are not important articles, as I un- derstand ; they are well-known medicinal roots. The Witness. It is not left to my judgment whether they are for medicinal purposes or not; the decisions of the Treasury Department decide that. The regulation is that all articles recognized in the phar- macopiasof France, Great Britain, and the United States are medicinal, our judgment to the contrary notwithstanding. I might say that a certain article was not medicinal, but if the book says it is, I am bound to recognize that authority. 422 TARIFF COMMISSION. [GEORGE W. JEWETT. Commissioner McMahon. The United States Dispensatory, for in stance, is an acknowledged medical work. In that yon will find ten thousand roots and herbs not mentioned in the tariff at all, which are covered by this general clause. I understand the witness to ask the use of singling out, here and there, from this large list a dozen or two articles, and putting them down in the tariff by name, and then cover ing the rest up by general clause. Commissioner Oliver. That was the reason why I made the inquiry of the witness; to ascertain if there was any reason for their insertion in the tariff. The Witness. Even if that was not the regulation of the depart men t, neither Dr. Headley nor myself would have any option in the mat' ter; we should be governed by the standard authority. I do not think any man would be likely to set up his ipse dixit against such high author- ity as that. Whenever there is a new plant discovered, it is analyzed by scientists, and if they decide it has any active or useful principle in medicine it is entered in the book. We have every edition of the Dis- pensatory as it is published. Xew plants are discovered in different parts of the world, and these are afterwards recognized as medicinal. Ten or twenty years ago we knew nothing about them. But I do not see any use in taking out a dozen or two of these articles from the Dis- pensatory when one general clause would cover them all. Section 1594 provides for “ flowers, leaves, plants, roots, barks, and seeds for medicinal purposes, in a crude state, not otherwise provided for.” Right under that is digitalis leaves. Paragraph 1494 provides for belladonna root and leaf, and paragraph 1502 for bitter apples, colo- cynth, and coloquintida. There is no use that I can see in mentioning those articles separately, for they would all come in under the general clause. Therefore I would strike those paragraphs out. I would, also strike out paragraph 1524, buchu leaves. I do not know what the idea was in making calamine free (paragraph 1530). If there is a point in making it free I do not know what it is, and if it is dutiable it .should come in as a chemical salt. Paragraph 1532, cantharides is properly in there, because it is spe- cifically mentioned. Chamomile flowers, in paragraph 1539, I would strike out. 1 would also strike out China root in paragraph 1541. It is covered by the clause relating to sarsaparilla root. I would also strike out paragraph 1543, cinchona root, and paragraph 1548, coculus indicus. Paragraph 1556 relates to colt’s-foot, the crude product. That comes under the dutiable clause of crude drugs, paying 20 per cent., and should be stricken out. Paragraphs 1557, 1558, 1559 ought to be stricken out; so should paragraphs 1567 and 1582. Paragraph 1583, ergot, should come in under crude products. I would also like to em- phasize a little what 1 said in regard to paragraph 1594, which is ‘‘flow- ers, leaves, plants, roots, barks, and seeds for medicinal purposes, in a crude state, not otherwise provided for.” I believe it was the intention of the law makers to make every plant and part of a plant used for medicine, in the crude or natural state in wliicli it is gathered, free of duty; but it fails to have that effect entirely, as I instanced in the case of lupuline. I would put in a clause covering plants or parts of plants, or something of that sort, so that pollen would be a part of the plant, and under that construction of the law it would admit lupuline. 1 would also strike out paragraphs 1599, galanga; 1601, gentian root; 1603, ginseng root. Ginger root, under paragraph 1602, I have noth ing to do with in my division. Hellebore root, paragraph 1617; para- graph 1626, hyoscyamus; paragraph 1629, Indian hemp; and paragraph GEORGE W. JEWETT.] 423 appraiser’s department, n. y. 1633, ipecac ; I would strike all of these out. Paragraph 1635, orris root, I would leave in. Paragraph 1639, jalap, is a root and is covered by the clause relating to roots. Commissioner McMahon. As the law stands now, ipecac and jalap are covered in the powdered form. By putting them under paragraph 1594, they would only be covered in a crude form. The Witness. Yes; but we object greatly to the importation of pow- dered drugs in bulk. No man can tell about a powdered drug whether it is pure and fit to be used for medicine or not. All physicians object to the use of powered drugs where it is possible to avoid it. If the matter was left absolutely to me I would not allow one particle of powdered drugs to come into this country. If manufacturers in this country try to adulterate them, the government could take some steps to prevent it; at any rate, I would prevent it as far as I could by preventing powdered drugs coming into the market. There are certain drugs which have an active principle, and it is only by a chemical analysis that you can determine whether they possess that or not. There is no active princi- ple in rhubarb, and you can test it in many ways. But to import drugs in a powdered state in bulk I do not think would be ’well. By Commissioner Oliver : Q. Why would it not be well to put a duty on powdered drugs and let the other drugs come in free % — A. There is a special law regulating the importation of drugs, which provides that no article of that kind shall come into this country unless it comes up to a certain standard of purity, and where there is no standard, as in the case of a root, it must be as perfect as possible. If it is old or moldy, or anything of that kind, it is not allowed to come in. If opium falls under 9 per cent, of morphia it is not allowed to enter. In regard to powdered ipecac, no man can tell whether it is half ipecac and half some other root, from the appearance of the powder ; but you have to get a very fine chemical analysis of it to find the alkaloid representing it. There is but little in- troduced, and that is put up by standard chemists on the other side who have a high reputation, and whose name stands as well as Powers and Weightman do with us in this country. I would also recommend the striking out of paragraph 1667, marsh- mallows, and paragraph 1668, matico leaf. Peruvian bark, paragraph 1705, comes under a general head. Paragraph 1720, quassia wood or bitter wood; that would properly come in under the general provision if paragraph 1494 was amended so as to read “ plants or parts of plants.” But as it is I should leave it in. Bhubarb, paragraph 1 729, 1 would strike out, and also paragraph 1731, rose-leaves. By Commissioner McMahon: Q. Are rose-leaves necessarily medicinal leaves'? — A. No, sir; there are some things recognized as medicines which may be used for other purposes. Opium is a purely medicinal preparation, but it is used in smoking ; but that does not alter the fact that it is medicinal in its gen- eral use. Q. Would not rose-leaves be recognized as the basis for perfumery % — A. Not necessarily. I would also recommend the striking out of the following paragraphs: 1738, salep; 1740, sarsaparilla, crude; 1741,sassa fras bark and root; paragraph 1748, senna, in leaves; paragraph 1762, squills; paragraph 1763, staves-acre. The latter article is a crude plant; of course the other clause I have referred to covers that. I think that is about all that I have to recommend, except that I desire to say again 424 tariff commission. [GEORGE W. JEWETT. that there is a great deal of repetition, and many articles are designated which should he covered by one general designation. By Commissioner Porter : Q. I want to ask one question. What do you think of the feasibility of making a special chemical schedule under the head of chemicals and oils, instead of putting all chemicals under the head of sundries'? — A. I think that would be a very excellent idea. I think there should be a separate schedule, the same as there is for hardware and other goods, instead of putting all these things in promiscuously. At present the im- portation of chemicals is large, and there is an immense variety of them. Chemistry is the basis of all manufactures, and every manufacturer of any importance has to have an active chemist in his establishment as a part of his regular force. The application of chemistry to the arts and manufactures is constantly increasing. I think it would be well to have a general list or schedule of the chemical preparations, and it might include as well the medicinal preparations. Sometimes an article is imported by the barrel instead of by the ounce, to be used in medicine, and it is recognized as a medicine notwithstanding its bulk. Of course we cannot follow an article and see what ultimate use is made of it. Glauber salts may be used for a horse, or in a laboratory to produce some other chemical. Q. Do you know why chemicals were put in under the head of sun- dries 1 — A. I do not. Q. Or why there was not a chemical schedule in the present law ? — A. I do not know why it was not done. Commissioner Oliver. You have been over the free list and have suggested a great many articles that might be omitted from it. Some people think that the free list ought to be enlarged, but your sugges- tions are the other way and tend to limit it. The Witness. I do not mean to recommend that the clauses should be thrown out entirely, but to strike them out of the list where they are named, and put them under a general clause in the free list which will cover them all. Commissioner Oliver. I understand that, but I was going to ask if, as a practical man, acquainted with this matter, you would give us a list of articles now dutied that it does not pay to collect a duty upon, keep- ing in view of course such articles as cannot well be produced in this country, and which do not need protection, and also those which can be produced and need protection. I agree with you that it would be well to take out these articles and include them under a general clause. The Witness. As far as articles of chemistry are concerned, I do not think there is an article produced in Europe that cannot be pro- duced here, and the majority of articles of this kind are produced here to-day. Of course they cannot be produced as cheaply here as in Eu- rope, on account of the greater price paid for labor. But there are a large number of articles which could be thrown into the free list where the small amount of money collected does not pay for the trouble of col- lecting it ; and if the amount produced in this country is small, of course the duty does not protect any industry at home. Commissioner Oliver. Will you make a list of such articles of that kind as you think could be put upon the free list ? The Witness. I will look over the list, and will suggest such articles as I think could be put on the free list advantageously. 08CAR HAMMERSTEIN.] SUMATRA TOBACCO. 425 OSCAR HAMMERSTEIN. Long Branch, N. J., August 15, 1882. Mr. Oscar Hammerstein, of New York, editor of the United States Tobacco Journal, made the following statement: I desire to engage the attention of the Commission for a few moments while I speak upon a most important subject. The leaf-tobacco trade of the country has been brought to a standstill during the past six months, owing to the continually increasing importation of Sumatra tobacco. This tobacco first made its appearance in the United States about two years ago. It had never been used before, and it sprung into favor, first gradually, and then very rapidly, so much so that its im- portation has become enormously great, and the tobacco-culture indus- try of this country is threatened with almost entire destruction. I do not give you this merely as my opinion, but I have the facts to prove it. The American tobacco trade is utterly at a standstill, owing to this continued importation. The tobacco is imported in large quantities, because of its superiority to our home tobacco. The importation of this tobacco began to assume importance in July, 1880. At that time the importation amounted to about 12,000 pounds per month, while during the month of July, 1882, it amounted to 147,224 pounds — a most enor- mous increase. It might be well for me to state here that 4 pounds of Sumatra tobacco is considered equal to an average of about 12 pounds of home tobacco. If a manufacturer of cigars uses 4 pounds of Sumatra tobacco, he can cover 1,000 cigars with it as well as if he used 12 pounds of the tobacco raised in this country, in Pennsylvania, Connecticut, Ohio, and other States. The cost of Sumatra tobacco in the market averages from $1. to $1.20 per pound. Four pounds of Sumatra tobacco at $1.20 makes $4.80. Twelve pounds of tobacco raised in this country, at 50 cents a pound, amounts to $6, so that, in point of fact, the tobacco raised in Sumatra is a great deal cheaper than the tobacco raised in this country. Besides that, it is equal to the finest Havana tobacco; indeed it is a great deal better than Havana tobacco for wrapping pur- poses. A cigar wrapped with Sumatra tobacco, since it has become known, will bring ten times as high a price as a cigar wrapped with tobacco grown in this country. Now let me show you the amount this country loses on the sale of tobacco. Up to about two years ago our exportation of home tobacco was 50,000 to 00,000 pounds a year. Other countries formerly in the habit of using our tobacco began to use these fine qualities of Sumatra, tobacco and stopped buying ours. The exportation of seed-leaf tobacco has almost entirely ceased. At this time of the year, formerly, the mar- ket was always bare of old tobacco. This year we have the stock of nearly 20,000 cases on hand, and the new tobacco which was raised last year is lying almost entirely neglected by the manufacturers of cigars in this country on account of their preferring to use the Sumatra tobacco. The increase in the importation of this tobacco is continuing steadily, in the fiscal year ended 1881 the importation only amounted to 179,002 pounds, but in the fiscal year ended 1882 it amounted to 774,715 pounds, 42 G TARIFF COMMISSION. flOSCAR HAMMER8TELV. an increase ot several thousand per cent. In no month since the impor tation of this tobacco began has there been anything like the amount imported that there was during the last month, the importation reach- ing 147,000 pounds. There are about fifty packers of tobacco in this country who buy to- bacco from the farmers, and of this number about fifteen of them repre- sent firms in Antwerp, Amsterdam, and other European cities, and while they formerly bought American tobaccos they seem to have come to the conclusion that the tobaccos grown here are not of much value, so far as the making of good cigars is concerned, compared with the Sumatra tobacco. There is another thing I would like to draw your attention to. The Sumatra tobacco pays the additional duty of 10 per cent, which is im- posed on all goods brought from west of the Cape of Good Hope. Con- gress at its last session abolished that 10 per cent, duty, and the result is, in effect, to offer a premium on the importation of Sumatra tobacco. The reduction of this 10 per cent, duty alone lias aided very much in deciding manufacturers to import this tobacco. Instead of raising the duty, for some mysterious reason (I suppose Congress was not suffi- ciently informed, otherwise it would not have been done), they reduce the duty and open the doors for still greater importation, and, as a result, the destruction of the culture of home tobacco. I have put in the schedule handed me a statement in figures, and if any of the members of the Commission desire to interrogate me 1 am perfectly willing to answer their questions. I have stated in the sched- ule that the additional duty on Sumatra tobacco should be at least 35 cents per pound and 50 per cent, ad valorem, or a full duty of $1 a pound. That would be the very lowest estimate, because even then it would only make it come up to the present cost of tobacco in this country. In my judgment, there should be a still higher increase than 50 per cent. I have explained the matter as fully as I can in the schedule which you gave me. I could not, of course, state what the government would re-j ceive in the way of additional duty on account of the increased impor- tation. i It is impossible to predicate the exact amount of increase in value of imports of Sumatra and other East India tobaccos, since the importations first began to attract attention about July, 1880. Since that time there has been a steady and rapid increase in the amount of Sumatra tobacco imported. It has been estimated that the East India product can be worked advantageously as a wrapper for cigars in the proportion of 4 pounds per thousand cigars, as against 12 to 20 pounds of American tobacco required to make a thousand cigars. The amount of American tobacco required to manufacture 1,000 cigars varies from 12 to 20 pounds, while the quality of Sumatra tobacco is so fine that the manufacturer does not require over 4 pounds of it to make 1,000 cigars. It is all leaf. When a manufacturer buys American tobacco he never knows whether it will take 12 or 20 pounds to make 1,000 cigars, but in the case of Sumatra tobacco he knows exactly how far it will go. I am not interested in the manufacture of cigars or tobacco. My only interest in the subject is, that I am the editor of a tobacco journal, and that is the reason why 1 have taken the liberty of bringing this matter before you. I have no business interests which will be affected by any action which you may take in regard to the duty on Sumatra tobacco. Sumatra and other East India tobacco, is a rich, oily product of fine appearance. It is a beautiful tobacco, finer than Havana tobacco, and brings in the lS T ew York market the average price of $1 to $1.20 a OSCAR HAMMKKSTRIN.l SUMATRA TOBACCO. 427 pound, while American wrappers of the best quality only bring from 35 to 50 cents a pound. As 1 have already stated, 4 pounds of Sumatra tobacco at $1.20 makes $4.80, while 15 pounds of the best American to- bacco at 50 cents makes $7.50, taking the highest market prices in each case; thus making a discrimination in favor of Sumatra tobacco of $2.70 a thousand. There is not a manufacturer in this country who, after he has seen Sumatra tobacco, will not stop using the Pennsylvania, Connecticut, Ohio, and other American tobaccos. Several meetings have already been held by the growers of tobacco in regard to this sub- ject. One was held in Lancaster County, Pennsylvania, and the Farmers’ Club of Syracuse, IN. Y., I understand, will hold a meeting next week. They are getting up petitions to Congress for an increase of duty on this tobacco. The tobacco trade in New York is divided very much on this subject, and that is the reason why none of the gentlemen who are specially interested in the business have appeared before you. There is a great profit in the use of Sumatra tobacco, it being sold now in such large quantities, and as a consequence the price of the home tobacco which is now growing has been forced down to a very low figure, so low that, if there is no stop made to the importation of Sumatra tobacco, buy- ers will certainly have a very good chance to get American tobacco from the farmers at a very low price, because there is no sale for it at present except for exportation at the low rate of 3, 4, or 5 cents a pound. By Commissioner Kenner : Question. Would you not accomplish your purpose if the internal- revenue tax was taken off of American manufactured tobacco ? — Answer. No, sir; that would not accomplish anything in this direction. Q. Why not? — A. Because the importation would still continue. Q. But would not the abolition of the internal-revenue tax equalize the price in such a manner as to enable the American grower to compete bet- ter with the Sumatra tobacco than he could under a simple increase the duty? — A. No, sir; not at all. Commissioner McMahon. There is no internal-revenue tax on leaf tobacco ; it is only on manufactured tobacco, and the internal-revenue tax is the same on cigars, whether made of foreign or domestic tobacco. By Commissioner Kenner : Q. Then it would not beany assistance to you at all if the internal - revenue tax should be removed ? — A. No, sir : none whatever. It would be a great assistance to the tobacco trade if that could be done, but 1 do not suppose that tax will be removed. Q. What is the capacity of Sumatra to produce tobacco? — A. It is estimated that the crop of this year will amount to between 80,000 and 100,000 bales, of 175 pounds to the bale ; and 175 pounds of Sumatra tobacco is equal to about 000 pounds of American tobacco. Commissioner Oliver. But only for certain purposes. The Witness. Yes, certainly, for fine cigars. It is only on the fine tobaccos that the grower makes anything. He does not make anything out of the poorer grades of tobacco. So that every bale of Sumatra tobacco that comes into this country takes the place of 000 pounds of our own tobacco, and throws that amount upon the market. This is getting to be a very serious subject indeed. By Commissioner McMahon: Q. Do I understand you to say that better cigars can be made from Sumatra tobacco than can possibly be made from American tobacco?— A. Yes, sir. 428 TARIFF COMMISSION. [OSCAR HAMEERSTKlNr. Q. Then if a duty should be put on Sumatra tobacco sufficient to make the cost of 1,000 cigars made from it the same as if made of Ameri- can tobacco, you think the tobacco manufacturers would still prefer the Sumatra tobacco at the same price? — A. Yes, sir. Q. Then what do you want done; do you want the duty put up so high that it will prohibit the importation of Sumatra tobacco ? — A. Yes ; I would like to see the duty put at such a figure as to stop importation. Q. Then, on that same principle, it being conceded that the Eogers and Wostenholm cutlery is better than American cutlery, and French artificial flowers being superior to American artificial flowers, your gen- eral idea would be to prohibit the importation of anything of a better class than the American product; is that your idea? — A. Yo, sir; I haven't said that at all. Tobacco is not a manufactured article. It is a raw material which we grow in this country. Q. But we don’t grow as good tobacco as the Sumatra! tobacco, do we? — A. Yes, we do; but it is not as rich and acceptable in appearance as the Sumatra tobacco. By the President : Q. Is this Sumatra tobacco used ouly for making the wrappers? — A. Yes; that is the only use made of it. Q. So that the matter of appearance is one of great importance? — A. Yes, sir ; as all smokers know, the appearance of a cigar is nearly every- thing. By Commissioner Oliver : Q. Do you say that this Sumatra tobacco is as good as the Cuban leaf tobacco ? — A. Yes ; it is better in appearance. The Havana to- bacco is coarse and has a reddish look, while the Sumatra tobacco is silky, oily, glossy, and thin. There is not the quality in the Sumatra tobacco that there is in the Havana tobacco, but it is the style and appear- ance; it makes a beautiful -looking cigar. Havana tobacco is brought to this country owing to its fine quality. We do not import Havana wrappers at all, or only in such small quantities as hardly to amount to anything, because the Havana wrappers are not as good looking. That is a point I desire to impress upon you — that while this Sumatra to- bacco is not better in quality than our home tobacco, yet its appearance is so taking that every manufacturer can sell it better than he can any of the home tobaccos. By Commissioner Boteler : Q. Do you say that the Sumatra tobacco is not better in quality than our American tobacco ? — A. It is not. It is only superior in ap- pearance. Any one can see the difference at a glance. By Commissioner Kenner : Q. What rate of duty would you recommend to be put on Sumatra tobacco? — A. I would say about 35 cents per pound and 50 per cent, ad valorem. By Commissioner Oliver: Q. Why do you not recommend a specific duty by the pound; is it not better to have a duty by the pound? — A. Yes, sir; that would be still better. By Commissioner Underwood: Q. Your idea, then, is to put a duty on it of about 70 cents a pound? — A. My idea is to have the duty about 50 per cent, ad valorem. Q. That would make it about 70 cents a pound. — A. Yes, sir. It is worth from 8 1 to $1.20 a pound in market. If the duty was made 50 OSCAK HAMMEKSTK1N.] SUMATRA TOBACCO. 429 per cent, ad valorem, that would make the cost of it about $1.75, which would only then equalize it with our own production in cost. But even with that duty upon it, it would still be preferred for the very finest class of goods. By Commissioner Garland : Q. What is this tobacco worth in the European markets where it is purchased ? — A. The price ranges from 40 to 80 cents a pound, accord- ing to the quality. The darker the color the higher it is in i>rice. By Commissioner Underwood: Q. What part of the United States produces tobacco suitable for wrappers for cigars ? — A. Pennsylvania produces the best, then Con necticut, then Wisconsin, New York, and then Ohio. By Commissioner Kenner : Q. Maryland, Virginia, and Kentucky tobaccos are not so good for wrappers, you think? — A. No, sir; they are not used for wrappers at all. By Commissioner Underwood: Q. Did you ever buy any Florida tobacco for wrappers? — A. They used to buy that many years ago, but they stopped it ; it did not pay them. The people in Florida do not seem to understand the culture of tobacco, therefore they have not raised it to any extent. By Commissioner Kenner : Q. Have you any idea of the amount of tobacco that Sumatra can or would produce? — A. Sumatra grows about 80,000 bales, equal to 14,000,000 pounds. The Dutch Government controls Sumatra tobacco in its passage from grower to dealer, buying it from the growers on the Island of Sumatra and selling by subscription in Amsterdam to the highest bidder. These subscriptions or sales occur periodically. The imports into this port since July, 1880 (about which time the importa- tion began to assume some importance), was as follows: Quantity. 1 Value. 1880. 1 Pounds. 12, 126 87, 848 4, 926 17, 347 41, 493 2,077 25 92 3,121 14 18, 804 41, 730 $9, 713 28, 507 3, 168 12, 438 31, 454 13, 845 7 2,- 154 5 12, 693 • 26, 856 August September October November December 1881. j anuary ... . February March April June Total for the fiscal year 1880-’81 179, 602 140, 865 1881. J uly 65, 1 58 28, 352 78, 570 118,312 90,772 59, 178 42, 955 62.886 52,956 33,798 96,730 i 45,048 39, 057 18, 925 52, 343 72, 229 51,438 42, 510 26, 869 38, 603 31, 658 21, 424 59, 503 27, 759 August - September October November December 1882. January February March April May June Total 774,715 i 482, 318 430 TARIFF COMMISSION. [OSCAU HAMMERSTE1N. Aii increase of $341,453 during the fiscal year of 1881-82 over 1880-81. The present fiscal year commences with the enormous importations during July, 1882, of 147,224 pounds; value, $80,943. Taking 175 pounds as average weight per hale, the amount imported in bales during fiscal year ending June 30, 1882, is 4,426 bales. It is estimated that if the increase in importations is continued proportion- ately, at the end of ten years it will amount to 25.000 bales, K. E. HASTINGS. ] GOLD LEAF. 431 R. E. HASTINGS. Long Branch, N. J., August 15, 1882. Mr. R. E. Hastings, of the firm of Hastings & Co., of Philadelphia, gold-leaf manufacturers, made the following statement : I understand from the published reports, that the Commission has given a hearing to parties asking for a re-arrangement of the duty on gold leaf, and as a manufacturer of that product I appear before you to state a few facts relative to the business. Lt has been stated in the newspapers that the general understanding is that the Tariff Commis sion will recommend the lowering of certain duties on imported goods, I understand that the journeymen of our business have asked you to put the tariff on gold leaf at w T hat I would call an exorbitant rate. Goods now selling for $7 pay a duty of $1.50 per package of 500 leaves. I do not come to advocate the raising of the present duties ; I think that is unnecessary. But, at the same time, I do not think the duty should be lowered, as it is now only sufficient to give us a fair protec tion. Should you recommend an increase of the duty to $2.50 per package of 500 leaves, which 1 hear the journeymen have asked, the duty would then be $2.50 on goods which would be sold for $7, and we are very much afraid that would create a disarrangement in the busi ness and lead to smuggling, for it would give a profit of 40 per cent, to the smuggler of these goods. We have, we think, all the protection that is necessary to carry on our business with a fair profit, but we do not think we could stand a reduction, even to a limited extent. We pay the men employed in our business about the same rate of wages that most mechanics earn, and we give them steady work. We appre hend that if you were to grant the request made by the journeymen that the effect would be to disarrange the whole business, and in the end be of no advantage to them. These are my ideas gained from ex- perience as a member of a large firm engaged in this business. I do not know that the employes are paid as large wages as they ought to receive ; they are not paid as high a rate of wages as they would re- ceive if there was no internal competition. They seem to think that if the rate of duty is increased it would give them an increase of wages, forgetting the fact of internal competition, and forgetting that it is this internal competition which has put the rate of wages below what could be given them if there was only a fair rate of duty. As I have said, if the rate of duty is increased to the figure recommended by the parties who have appeared before you, it will have a tendency to cause these goods to be smuggled, because the profits would be very large. I wish to impress upon the Commission, however, the fact that we have not at present any more protection than we need. I think if there was any lowering in the rate of duty, it would have a tendency to reduce the rate of wages and throw many of our operatives out of employment. By Commissioner Kenner : Question. What wages do you pay ? — Answer. A journeyman gold- beater makes, and we are now paying, about $13.50 a week. Some re- ceive more and some less, according to their capacity. It is all piece- 432 TARIFF COMMISSION. [R. E. HASTINGS. work. 1 think the journeymen must have lost sight of the fact that if the duty they ask for, which forms so large a proportion of the selling- price, was put on the goods, it would he such an inducement, that the goods would be smuggled into the country. There is now but little gold leaf imported. The statistics for the last year show, however, a large importation of gold leaf; but that was owing to troubles in the trade which threatened the production, and that amount was brought in to make up for that lack of production in this country. It was owing to the long lock-out or strike that these goods were imported to fill up the gap, and the minute the strike was over the importation ceased. By Commissioner Boteler : Q. The gold-beaters asked for an increase of the duty per package to $2.50, when now it is only $1.50. Do you think the present rates are sufficient to protect the manufacturer ? — A. I think they are. The gold- beaters have forgotten that the consumers’ rights are to be considered. I base my arguments on these facts, that the manufacturers are not now paying the rate of wages that they could pay if they fully availed themselves of the $1.50 duty. What the manufacturers now get $5 for, they could get $6 for, and still protect themselves against the present duty. But the idea of the gold-beaters seems to be that, if the duty was raised to $2.50, it would run their wages up. They overlook the tact that the business could yield them $6, but does not, on account of internal competition. I hold that where they go beyond the point of protection that internal competition gives them, it will interfere with the consumption, and therefore the rates of wages will be lowered at once. Those goods which sell now for $7 could be imported to-day for about $6.70, and if you should put an additional 5 per cent, duty on the goods, it would make them go above the selling price to day, and it would not in the end yield the workman any benefit. L. MCMULLEN.] appraiser’s department, n. y. 433 L. MCMULLEN. Long Branch, N. J., August 15, 1882. Mr. L. McMullen, examiner, appraiser’s department, New York, ap- peared before tlie Commission and made the following statement : I will begin my statement by taking up and commenting upon the schedule relating to metals (Schedule E). The first paragraph, No. 988, is, “Iron in pigs:- seven dollars per ton.” That paragraph does not require any alteration. The next paragraph relates to bar iron, rolled or hammered. I would suggest that the items in that paragraph be placed at one rate of duty, say, at a medium rate of a cent and a quar- ter to a cent and a half per pound, and that the last words, “and none of the above iron shall pay a less rate of duty than thirty-five per cen- tum ad valorem,” be stricken out. Commissioner Kenner. Before we go any further in the examination of these custom-house officers, I would request the Commission to con- sider whether, when experts are discussing the phraseology of the classi- fications, it is proper for them to give estimates of rates and duties. I do not think that is within the province of these witnesses. I make this suggestion so that we may know how to proceed. Commissioner McMahon. I understood Mr. McMullen to advise a medium rate of duty. Commissioner Oliver. And a simplification of the classification. The Witness. I was simply expressing what I meant by simplifica- tion of the schedule. This bar iron runs into an ad valorem rate of duty. It would be much simpler to have one rate of duty for bar iron, and then, if it is deemed advisable, another rate of duty for sheet iron and hoop iron, and group them in another paragraph. By Commissioner Oliver : Question. What difficulties have you had as regards the paragraph you have cited ? — Answer. There has been no trouble except that aris- ing from having three or four classifications instead of one for all bar iron with one rate of duty, whatever that rate might be. Q. You do not object to the descriptive part? — A. Not at all. Q. Could you extend the language of it in any way ? — A. No j it is very good and comprehensive. Tbe latter part of the clause runs into the higher grade of Swedes iron, and very little of that pays the ad valo- rem duty of 35 per cent. I next pass on to “iron bars for railroads or inclined planes.” That stands by itself, and does not require any alteration. The next para- graph is “boiler and other plate iron.” That is the same. The next paragraph is in regard to iron wire, on which there is a specific and ad valorem duty. I think it would be well to do away with that compound duty. The same remark applies to steel wire. I do not see why the same amount of duty could not be assessed by having a simple specific rate and not a compound rate, both specific and ad valorem. “Bound iron in coils,” in the next paragraph, stands very well as it is. Sheet iron and band, hoop, and scroll iron are mentioned in three or four dif- H. Mis. 6 28 434 TARIFF COMMISSION. [L. MCMU1LEN. lerent paragraphs. I would have them grouped in one paragraph, with the lowest rate of duty at 1J cents and the highest If cents. Q. Do you suggest that because you have had trouble in determin- ing the classification ? — A. Not on that ground, but on account of the immense amount of work required in classifying the invoices. By Commisoioner Oliver : Q. As a general rule, ad valorem duties are placed upon the higher priced goods, and those which are more troublesome to make and take care of, or to raise. The common varieties of goods are of course the heaviest and the easiest handled, and usually there are ten times the quantity used of them. I judge the object of making the tariff read in that way was to combine to some extent the ad valorem and the specific rates? — A. You mean the provisions relating to the fineness of the gauge ? Yes. I merely throw out these suggestions and do not know whether they could be adopted. I think it would be very desirable if they could be grouped in fewer classifications. There are classes of hand saws which have a compound duty on them that might as well be under a general head, at an ad valorem rate of duty. Commissioner McMahon. It is about three times as much work to classify an invoice, both for the importer and for the custom-house officials in that way. But the jwactical difficulty is in the weighing. These articles pay by weight, and they pay three separate rates of duty, by weight, grade and gauge, and the difficulty comes in separating this iron on the dock and getting it properly weighed. The goods that should pay the rate of If cents will be weighed with goods that ought to pay 1J cents, and they will get mixed up, and the importers are con- stantly complaining that the weights are not right. If one uniform rate was adopted, it would do away with much annoyance and complaint on the part of the importer. The Witness. Sections 1004,1005, and 1006 relate to hand saws, back saws, and files. I think those paragraphs might be done away with, be- cause the importation of these articles is very small indeed, and they could all be covered by the paragraph covering the manufactures of steel, Commissioner Oliver. That would bring the duty in as an ad' valo- rem duty. The Witness. Yes, sir ; I may say that a hand saw is seldom, if ever, imported now. That is not because of the high rate of duty, but it is on account of the progress that has been made in this country in cheap- ening the production and improving the quality of these goods. The same is true in regard to files ; there are hardly any imported, so that it would be hardly worth while to keep all the different classifications there together and enumerate these different articles that could be just as well covered by the paragraph relating to the manufactures of steel. By Commissioner Oliver : Q. Could they be covered in that way by making the duty a specific one? — A. Yes, sir; you might make it a specific duty of so much a dozen, for instance, on hand saws, or so much a pound on files. The present rate of duty on files is six to ten cents a pound, and thirty per centum ad valorem. I think the rate of duty might be fixed at a spe- cific rate per pound, and do away altogether with the ad valorem. The American files can be produced much cheaper than the European man- ufacturers can export them, because we have in this country many new machines for cutting the files which has greatly lessened the cost of jiro- duction. L. MCMULLEN.] appraiser’s department, n. y. 435 Q. You passed over section 904 in regard to wire, without comment- ing upon it. To follow out your idea of simplifying the tariff by enu- merating similar articles under one head, I would make this sugges- tion: Iron wire is fast passing out of use. It is used less and less. Some is used for telegraphic purposes, but for scarcely anything else. Would it not be simplifying matters to say “iron and steel wire” so much? — A. Yes, sir ; and I will say in that connection that there should be a blend- ing of all these wire and steel manufactures. Take a piece of ma- chinery under the present law. Where a piece of machinery is valued at three thousand pounds sterling, and it happens that there is in that machinery only about eighteen shillings worth of steel, that small amount of steel controls the duty. There should be a way of having iron and steel manufacturers pay the same rate of duty. There is no conclusive way of finding out whether an article is composed of steel or any portion of steel, without destroying the article to see. Q. You would make the terms synonymous, then? — A. Yes, sir. Q. Then in section 994, you suggest the wiping out of the compound duty? — A. Yes, sir. Q. Your suggestion is, that no matter what the article may be, it should pay so much a pound? — A. Yes, sir; your idea is a good one, to blend the two together, iron and steel. Q. Did you have much trouble in regard to this matter of the gauge of wire?— A. No, sir. Q. The gauge is easier ascertained, I suppose, in regard to wire than it is in regard to sheet iron? — A. Yes, sir. It is not the trouble to the inspector that I am talking about ; but my suggestions are in the way of simplifying these classifications where I think the same result may be arrived at; that is, the same amount of money collected as duty that is collected now. We do not often get any goods coming in under that iron-wire clause that are less than 16- wire gauge. Immediately after that law was passed we had some wire that was larger than that, and we had to bring it in at 35 per cent, ad valorem as a manufacture not otherwise provided for, for it was not provided for then, and is not now. Q. That is one of the largest articles of importation now? — A. Yes, sir. Q. What have you to say in regard to these sections, 999 to 1001 in- clusive, in regard to band, hoop, and scrap-iron ; how lias that worked practically? — A. It works the same as the provision for bar-iron does. I think it would be well to group them together in one category. I would put hoop, scroll, and sheet iron all together in one paragraph. 1 think the whole matter could be so simplified that it would not give rise to objections as to particular classifications under the laws; we would get clear of that. Q. Here is the item of sword-blades; wliat have you to say in regard to that? — A. They are coming in all the time. I suppose that item is well enough, and does not need to be disturbed. English and German sword-blades are coming in constantly. Q. What do you say in regard to paragraph 1007, “pen knives, jack knives, and pocket knives of all kinds: fifty per centum ad valorem”? — A. I would not recommend any change in that classification ; there is nothing there that needs to be changed except, perhaps, the rate of duty. Q. We had this subject before the Commission yesterday. The pocket- cutlery manufacturers made an argument before us. — A. The suggestion of the cutlery men that the rate of duty should be 50 cents a dozen 436 TARIFF COMMISSION. [L. MCMULLEN. would, if carried into effect, make the law prohibitory in its effects on the cheaper kinds so far as the foreign article is coucerned. There are only two resident manufacturers of foreign goods in this country, Wosten- holm and Rogers, and ther*goods are invoiced to merchants generally at the same price at which they are consigned to their agents. Q. How about the importations from Germany? — A. There are no resident agents of German cutlery here. By Commissioner Kenner : Q. How do you ascertain the fact that there are no resident agents of the German manufacturers here? — A. I have never heard of any. Q. Could not a man be in the business and receive goods as an agent without its being known to the public? — A. Not very well, because if he is in the business he gets to be known among the trade as the agent of the party ; you hear of it from one or another. I come now to para- graph 1011, iron squares ; that could very well come under the general head of manufactures of iron. By Commissioner Garland : Q. Are there any steel squares imported ? — A. No, sir ; there are none imported at all. Commissioner Kenner. I notice that under this section it says, “iron squares marked on one side: three cents per pound, and in addi- tion thereto thirty per centum ad valorem ; on other squares of iron or steel: six cents per pound and thirty per centum ad valorem.” If we should unite these under one classification at a medium rate of duty, how would it affect the rate of duty ? One description of iron squares is three cents a pound and the other is six cents a pound. There must have been some object when this tariff was framed why that distinction was made. If you obliterate that distinction by making them all at one rate of duty, of course it simplifies the matter, and the officer’s duty is simpler. But is there not a tendency in that way to entirely derange the whole system on which duties are predicated, if there is any system on which they are predicated at all? Commissioner McMahon. Mr. McMullen says that they are no longer imported, and therefore he wants to obliterate that section and rele- gate these articles into the sections providing for general subjects. Commissioner Kenner. I am not discussing the question of simpli- fication, but it is really changing the basis on which the whole tariff system is founded, if there is any system about it, aud if it is not mere haphazard and guesswork on the part of the framers of the tariff. The Witness. There never has been a steel square imported under that law. Commissioner Kenner. Perhaps it is because the rate of duty is prohibitory. The Witness. No, sir; I think that steel squares may be called an American institution. I think we can make and ship them to the other side at a fair profit. Commissioner Kenner. Then I do not understand the theory on which this iron schedule was framed. Commissioner Oliver. At the time this act was passed, these goods were all made in New England. In the old days they worked by hand ; now they work by machinery, and the best gauge in the world, which is called the Birmingham gauge, is made in New England. The duty was so high that it gave the market for these goods to the American manu- facturer, and as a result the Americans are making the best goods at the present time. The manufacturers might suggest a rate that would l. mcmullen. J APPRAISER’S DEPARTMENT, N. Y. 437 cover the whole class, iron and steel, so much a pound or dozen, and double the duty. By Commissioner McMahon : Q. If these articles were relegated to the general clauses, ’would they be imported ? — A. Ho, sir. Q. It is only wiping out an unnecessary part of the taritf, then, as I understand you ? — A. Yes, sir. Commissioner Oliver. I will state, in answer to Mr. Kenner’s in- quiry, that an iron square before it is marked is an article of very little value. It is worth so much a pound for the material, and the labor that has been put into it does not amount to much ; all the labor in the work is caused by the marking and the accuracy with which it has to be marked. The idea was to double the duty on iron squares where they are marked on both sides, and that distinction was made to get an in- creased duty. * Commissioner Garland. And to protect the laborer. The Witness. Yes, sir. By Commissioner Underwood: Q. I would like to ask the witness this question. If the duty was entirely taken off, would they not begin to import the goods at once? — A. Ho, sir; they would not, because the manufacture has grown in this country to such an extent that I think both iron and steel can be ex- ported to foreign countries. American manufactures of steel have been sold even in Sheffield, the great seat of the steel industries of England. The next section is 1012, which is as follows: “All manufactures of steel or of which steel shall be a component part not otherwise provided for: forty-five per centum ad valorem.” That ought to be altered ; it ought to be “ the component part of chief value.” I believe I instanced the case of a piece of machinery where the value of the ma- chine was £3,000, and the value of the steel in it was 18s., but the steel controlled the classification and it came in at 45 per cent., steel being a component part of the machine. If you will turn to section 1067 you will see that it says “manufactures, articles, vessels, and wares not otherwise provided for, of brass, iron, lead, pewter, and tin or other metal (except gold, silver, platina, copper, and steel), or of which either of these metals shall be the component material of chief value, thirty-five per centum ad valorem.” I would take out all those words that are in parentheses and have all under one rate of duty. Commissioner Oliver. And include the words steel? The Witness. Yes, sir. Commissioner Oliver. And do without the whole of those excep- tions ? The Witness. Y r es, sir. I would like to make a suggestion, also, in regard to other manufactures. I will instance machinery again, com- posed of iron and steel and glass. Leave out the steel and it is com- posed of iron and glass, and glass being a component part would change the duty. Glass should come in at the same rate ad valorem as iron and steel. Commissioner McMahon. There is the same phraseology about glass that there is about steel ; that is, instead of saying all manufactures of which glass shall be a component material of chief value, it says all manufactures of which glass is a component material. If it is made of steel and glass, and steel is the component material, the duty is 45 per 438 TARIFF COMMISSION. [L. MCMULLEN. cent., and where glass is the component material it is 40 per cent. They conflict with one another all the time. The Witness. In regard to all manufactured articles where the article is composed of different materials and at present pays a different rate of duty, they should be grouped together at one ad valorem rate of duty. Of course an exception could be made in the act for articles not other- wise provided for, and they could be brought in afterwards and par- ticularized. I think that is done in the case of wool. No matter how small a portion of wool there may be in an article, it is controlling, be- cause it forms a portion of the article. The next section is No. 1013, steel railway bars. There is no trouble about that. The next section, No. 1014, is railway bars made in part of steel. Commissioner Oliver. They are not coming in now. The Witness. No, and we have not had any for many years. Commissioner Oliver. Under this same paragraph it says: u And metal converted, cast or made from iron by the Bessemer or pneumatic process, of whatever form or description, shall be classed as steel;” what do you say in regard to that provision? The Witness. That had better remain as it is, because there are peo- pie who call it Bessemer metal. Commissioner Oliver. It will be necessary for us to have a definition of steel or iron in some way, I think. The Witness. Yes, that should be done. They have tried to do that in England. They held a convention there, but they could not fix on a standard of what should be called steel. They grouped the different grades of steel from the lowest carbon where the metal could be called steel, upward, but they came to no determination at all. The next paragraph is No. 1015, u locomotive tires or parts thereof.” That does not need to be disturbed. Paragraph 1010 contains a class of articles which have been taken from one tariff to another, and at present the paragraph does not mean anything. It says : u Mill-irons and mill-cranks of wrought iron, and wrought iron for ships, steam-engines, and locomotives, or parts thereof, weighing each 25 pounds or more, 2 cents per pound.” There is never any application made of that para- graph at all. It comes in either as a manufacture of iron or steel, accord- ing to the article of machinery that it professes to be. Commissioner McMahon. You would abolish that altogether, then? The Witness. 1 think so. The next item is in regard to anvils and iron cables or cable-chains. Anvils might be left at a specificrate, and the cables might be merged into chains, ar d there might be one rate of duty at 2£ or 3 cents a pound, and 35 per cent, ad valorem. Commissioner Oliver. There is fully a difference of 50 per cent, in value. The first item of chains is worth 4 or 5 cents a pound, while the other items would not be worth much over one-half that amount. The Witness. You could abolish every thing in paragraph 1017 except in regard to anvils. The next paragraph I call attention to is paragraph 1019, anchors or parts thereof; and the next paragraph, 1020, is blacksmiths’ hammers and sledges. Those are all specific duties. By Commissioner McMahon: Q. As a matter of fact, are any anchors imported at all into this country? — A. No, sir; none whatever. In regard to the item of black- smiths’ hammers and sledges, that is all right, and need not be disturbed. The next paragraph, 1021, relates to wrought-iron railroad-chairs, and wrought-iron nuts and washers, ready punched ; and the next para- l. MCMULLEN.] APPRAISER^ DEPARTMENT, N. Y. 439 graph, 1022, relates to bed-screws and wrought-iron hinges. There are no bed-screws imported, and very few wrought-iron hinges. Commissioner McMahon. But nuts and washers are imported ? The Witness. Not a great many. The next item I call attention to is paragraph 1024, which relates to steam, gas, and water tubes and Hues of wrought iron. There are very few of these articles imported. Paragraph 1025 relates to cut nails and spikes. I think it would be well to leave that item out. Commissioner Garland. You omitted to speak of paragraph 1023, wrought board-nails, spikes, rivets, and bolts. The Witness. I do not think that paragraph need be disturbed. Commissioner McMahon. Would you leave in bolts at 2J cents when nuts are only 2 cents'? That question came up some time ago in a case where the nuts were on the bolts, and it was difficult to know what to do. Commissioner Oliver. The nut lost its name when it was on the bolt, and came in as part of the bolt. I think the two should be put together. The Witness. In regard to steam, gas, and water tubes and flues of wrought iron, in paragraph 1024, 1 do not think anything need be done. There are none imported, except some of the better quality of goods. Commissioner Garland. You would suggest that they go in with the general clause ? The Witness. Yes, sir; cut nails and spikes ought to be left off alto- gether, I think. There is a question about horseshoe nails, contained in the next paragraph. None of them are imported into this country. Commissioner Kenner. That may be owing to the excessive duty of 5 cents a pound. The Witness. No, sir ; the progress made in this country in the manu- facture of horseshoe nails is such that they will never be imported again. Commissioner Oliver. They export them from Boston to South America. The Witness. Yes; I think they had better go in the general column of manufactures, and so also cut tacks, brads, and sprigs. All those have been left over from former tariffs, and have been added to without any particular reason. The next paragraph, No. 1028, relates to wood- screws. I do not suggest any alterations in that. They are not im- ported, except at certain times when there is an advance in the price in this market. The next paragraph relates to screws of any other metal than iron, and all other screws of iron except wood-screws. They would come in under the general clause at 35 per cent. Commissioner McMahon. Yes, if we wipe this out, they would fall under that clause very naturally. The Witness. The next clause relates to u vessels of cast iron, not otherwise provided for,” and on andirons, sadirons, tailors’ and hatters’ irons, stoves and stove-plates, of cast iron. These things are all made in this country successfully, and they might go under the general clause. Cast iron pipes, referred to in section 1031, I do not think any of them are imported. Section 1032 refers to cast-iron butts and hinges. None of them are imported into this country, and the}' never will be again. They could go under the general clause. Hollow ware, glazed or tinned, in paragraph 1033, at 3J cents a pound. There is very little imported of that, and it might go under the general clause of manufac- tures of iron. The next section is 1034, cast scrap-iron of every de- 440 TARIFF COMMISSION. [L. MCMULLEN. scription, and 1035, wrought scrap-iron of every description, $8 a ton. This same paragraph provides, “but nothing shall be deemed scrap-iron except waste or refuse iron that has been in actual use and is fit only to be remanufactured.” 1 think that ought to be shut out. Commissioner McMahon. You mean that tbe clippings from new iron should be classed as scrap iron ? The Witness. Yes, sir. Commissioner McMahon. Would you keep up the distinction be- tween cast scrap iron and wrought scrap iron ? The Witness. No, sir, I would not. Commissioner Oliver. Do you think this proviso in paragraph 1035 should be stricken out? The Witness. Yes, sir, I do. Commissioner McMahon. There is no such clause as that in regard to scrap steel. Commissioner Oliver. That is no reason why there should not be one. It is a fact that axes have been put in with scrap iron, and the trip crossing the ocean gave them a rusty appearance, and after they had been passed as scrap iron they were selected out and used for axes. The Witness. That would not be scrap iron, according to my judg- ment ; it would be fit for use. I was referring to these short clippings, not more than two or three inches long. Commissioner Oliver. But for axes they would be longer. Let me explain that point, and see if you will change your opinion. The duty on Swedes bars are what ? The Witness. A cent a pound. Commissioner Oliver. A very large business is done in that article; it is the basis for all the cast steel made in this country. The duty on Swedes bars is one cent a pound, and it is imported largely, and the government derives a large revenue from it. Coming in the shape of bars, it pays a duty of one cent a pound. If you wipe this qualifying clause away it would come in as scrap iron. The trouble would be here : They cannot use Swedes bars until they cut it up. If it was not for the trouble in transporting, they would have it all cut up abroad ; but they do not want to shovel it ; they want to transport it in bars. If you wipe out that qualifying clause you will have no more Swedes bars imported. It will not interfere with any great industry in this country, because it is a peculiar iron, as you know. The Witness. Very well, then, an exception could be made to cover that difficulty. Commissioner Oliver. The exception is made as the matter stands. The Witness. Supposing boiler panellings come in as scrap iron ; take the punchings of these steamers that come m here. Commissioner Oliver. That is surely scrap iron. The Witness. But they cannot come in now under the law as scrap iron. Commissioner McMahon. It must be iron that has been in actual use. The section says “ wrought scrap iron of every description”; and adds, “ but nothing shall be deemed scrap iron except waste or refuse iron that has been in actual use.” Perhaps that difficulty could be covered by making the section read, “ wrought iron and scrap iron of every kind ; but nothing shall be deemed scrap iron except waste or refuse iron.” Commissioner Kenner. It might simplify the matter and render it easier to handle, but it actually changes the whole character of the sentence; the meaning of the whole sentence as to actual use. L. MCMULLEN.] APPRAISERS DEPARTMENT, N. Y. 441 Commissioner Garland. Would you recommend the retention of these words, “ and fit only to be remanufactured 77 ? Commissioner McMahon. That would be a contradiction in terms, because an article that has not been manufactured could not be re- manufactured. Commissioner Oliver. That could be covered by another clause saying that punchings and waste iron from new work shall bedutied as scrap iron. The Witness. The next section is No. 103G, “all other castings of iron not otherwise provided for, thirty per centum ad valorem. 77 That could come in under the general clause. The next section, No. 1037, is taggers 7 iron. I think I would let that go under the general clause. It pays a duty of 30 per centum ad valorem. Commissioner McMahon. Would you leave that paragraph as it is? The Witness. Yes; perhaps. Commissioner Oliver. That comes in under tin plates. Commissioner McMahon. Why should not that pay the same rate as sheet iron or tin plates ? Commissioner Oliver. There is a difference between tin plates and plates that have been tinned, and taggers 7 iron should come in as the same. That could be brought in under a specific duty very well, could it not? The Witness. Yes, sir; and it would be well to do that. We used to have a certain size of taggers iron, but now it is made a larger size, and the question comes up as to whether it is taggers iron or not. It is kindred to tin plates when tinned; that is the correct idea about it. Paragraph 1038 relates to steel in ingots, bars, coils, sheets, and steel wire. That ought to pay one rate of duty. It now pays 2J cents a pound, 3 cents, and 3J cents a pound, and 10 per centum ad valorem. There is very little of it that comes in at the highest rate of duty. If there was a middle rate of duty established, it would take in steel in ingots, bars, coils, or any other form. Commissioner McMahon. Would you not put in blooms there, too? The Witness. “Or any other form 77 would bring that in. Commissioner McMahon. You would interpolate the words “or any other form, not otherwise provided for , 77 would you? The Witness. Yes, sir. Paragraph 1039 provides for steel wire. We have already spoken of grouping that with iron wire at one specific rate of duty. Paragraph 1040 relates to steel, commercially known as crinoline, corset, and hat steel wire. I think that had better go with the manufacture of steel; there is but little of it imported. Paragraph 1041 provides for steel in any form not otherwise provided for. That would come in in the previous section of steel in ingots or bars, or in any other form. Commissioner McMahon. What about the proviso to section 1041 : “ Provided , That no allowance or reduction of duties for partial loss or damage shall be hereafter made in consequence of rust of iron or steel, or upon the manufactures of iron or steel, except on polished Russia sheet iron ; 77 would you retain that? The Witness. No, sir; I would not. Commissioner McMahon. You would allow damage for rust the same as you would any other damage, if you allow for damage at all? The Witness. Yes, sir; and that I suppose would be a very serious question. Paragraph 1042 relates to cross-cut saws. The same amount of duty is applied to these as is applied to hand-saws. There is nothing of the kind imported; they are made in this country, and they never 442 TARIFF COMMISSION. [L. MCMULLEN. will be imported here. We not only make the saws here, but we make the steel cheaper than they can make it on the other side at any time. Paragraph 1043 relates to mill, pit, and drag saws. That might come under the general clause. Paragraph 1044 relates to lead in sheet, pipes, or shot at 2f cents per pound. That might come in under gen- eral manufactures. There has been no lead or lead pipe imported for many years, and the shot is all made in this country. Commissioner McMahon. If it were relegated to the general clause, the importation would not begin. The Witness. Ho, sir. Lead ore, in paragraph 1045, is all right, and so is lead in pigs and bars, in paragraph 1046. Commissioner Oliver. If that is all right, why not put it in section 1044 with lead in sheets ? Commissioner McMahon. I do not see the necessity of putting it in any section, if the article is never imported. Commissioner Oliver. The reason why it is not imported is because the duties are too high. Commissioner McMahon. But now the manufactures of this country are so far improved that these articles will never be imported, and that relegates them to the general clause. It does not take the duty off from them at all. The Witness. Paragraphs 1047 and 1048 are all right ; there is nothing to be said about them. They relate to zinc and spelter. The President. Does the word “tutenegue” remain in use; is it a recognized word? The Witness. Yes sir; it has come down from one tariff to another. The President. Is it a name known in the arts? The Witness. Yes, sir. Commissioner Oliver. Spelter is quite a large item. The Witness. Yes, sir; I presume that is all right at that rate of duty. Paragraph 1050 relates to tin plates. That is provided for in another section of the law, and 1 have nothing to say about it. Para- graph 1051 relates to iron and tin plates galvanized, or coated with any metal by electric batteries. I suppose that had better remain in as it is, and so also paragraph 1052, which follows. Commissioner McMahon. What is the reason of the distinction; why should one pay 2 and the other 2J cents a pound? The Witness. I suppose that relates somewhat to the manufacture of the article in this country; I do not know exactly. Commissioner Oliver. You say that you think paragraph 1051 should remain as it is. Does such an article come into this country as a tin plate galvanized or coated with any metal by electric batteries; what would it be coated with ; is it an iron plate tinned ? The intention of the makers of that law was that it should be solid tin plates. The tin of commerce is an iron plated tin, but the law says “ coated with metal.” There never have been any tin plates coated with metal known in this country. Commissioner McMahon. It might be left “ iron galvanized or coated with any metal,” &c. Commissioner Oliver. I think it should read “iron plates tinned.” Commissioner McMahon. But those are provided for in the act of 1875, right above, in section 1050. What is the difference between taggers’ tin and taggers’ iron? The Witness. Taggers’ iron is not tin. Taggers’ tin assimilates to a tin plate in the thinness and smoothness of it. Y r ou take taggers’ iron and tin it and then it is taggers’ tin. 1 think paragraph 1051 is L. MCMULLEN.] 443 appraiser's department, n y. intended to relate simply to galvanized iron, and probably it had better remain as it is. If you take out the words u and tin ,” leave it “iron plates galvanized,” &c., it would be well. Next we come to the copper clause, No. 1053, “copper imported in the form of ores, three cents on each pound of fine copper contained therein.” That is a very hard law to collect a duty under. A party brings a lot of ore here, and we have to find out how much copper there is in it. Commissioner Oliver. Do you have to analyze it? The Witness. Yes, sir; the custom-house officers analyze it, the importer analyzes it, and then there is another analysis. It is very hard to get the percentage of copper in pure ore. Commissioner McMahon. In one case we had five different analyses of one lot of ore, and the result was different in each case. The Witness. I do not know how that could be overcome, unless by decreasing the amount of duty so much per pound. Commissioner Oliver. That is a question which deserves careful con- sideration, and should be carefully looked into. The Witness. I would like to speak right here in regard to iron ore, before I forget it. Iron ore ought to be on the free l-st, because these hematite ores are imported; but if they are not on the free list, there ought to be a specific duty of about forty cents a ton, which would yield the duty now received at the rate of 20 per cent, ad valorem. We ex- perience a great deal of difficulty in regard to market values, and the fixing of an ad valorem rate of duty. The market is so far away, in Spain and Africa, and there is a good deal of deception going on, and we do not always know the parties who bring in the ore ; so it is very difficult to fix a satisfactory market value upon it. Commissioner Oliver. JDo you assess the value now on the unit of iron ? The Witness. We used to ; but now we get the metallic value of the ore, which is the best way, I think. The Bethlehem Iron Company, made a contract for ore containing 55 per cent, of metallic iron, and in one lot which I inspected I tried to get 48, per cent, but could not get it. I was satisfied that there was 55 per cent., there, but I could not find it. I hope you will bear that in mind; it is a matter which should be considered. A specific duty on the raw material of about 40 cents a ton would pay about the same rate as 20 per cent, ad valorem. Commissioner Oliver. You mean to weigh it by the ton, the same as you would sugar or pig iron ? The Witness. Yes, sir. Commissioner Oliver. Can you make any further suggestions in regard to section 1053, copper? The Witness. No, sir; there is not so much of it coming in now. The ore which we have had has been, a great deal of it, silver ore. At present they are smelting ore in New Jersey, opposite New York; but there is not a large quantity of it coming into this country, and I hardly know what suggestions to make about pure copper, or how you would get at the rate of duty which would be equivalent to the present rate of duty. Commissioner McMahon. What do you say in regard to regulus of copper ? We had some trouble years ago in regard to that black copper ; there was difficulty in ascertaining the fine copper that was contained in the black copper. What do you say also in regard to copper in plates, bars, ingots, and pigs? The Witness. Very little of that comes into this country; in fact it is exported to the other side. Perhaps this 5 cents a pound duty may 444 TARIFF COMMISSION. [L. MCMULLEN. be tbe cause of its not being imported ; but I know as a fact that it is not imported. We used to have a large quantity of the regains of copper coming from South America, but we do not have any at all now. Perhaps it would be well to let that remain as it is. Commissioner Garland. Do you think the regulus of copper fails to be brought in on account of the high tariff ? The Witness. I suppose it is excluded on the ground that the duty is too high. The next section is No. 1059, nickel, at 30 cents a pound. I want to refer to that in connection with paragraph 10G0, nickel oxide and alloy of nickel with copper. I think that alloy of nickel with cop- per at 20 cents a pound should be stricken out, and all nickel should pay 30 cents a pound duty. Commissioner Oliver. You have trouble now, I suppose, when they bring it in mixed ? The Witness. We pass it now where it contains 97 per cent, of nickel and 3 per cent, of copper, and that makes the difference between the 20 cents and the 30 cents a pound duty, under a decision of the department. Commissioner McMahon. How about sheathing or yellow metal; does any of that come into this country? The Witness. Yes, sir ; sheathing metal comes here all the time. Commissioner McMahon. What do you say about that; is that a proper rate of duty; do they not avoid that rate of duty by evading the description indicated? Why not make yellow metal pay one rate of duty, and done with it. I understand that the importers avoid the duty by reducing or increasing the size of their sheets to get over the classification contained in the law. The Witness. You think it should be admitted at one rate of duty without any qualification? Commissioner McMahon. Y r es; that is my idea. The Witness. Well, that would do, perhaps. In regard to para- graph 10G0, the alloy of nickel with copper, I believe that subject is well understood by the Commission. Paragraph 1061 relates to gold-leaf. I think that paragraph had better remain as it is. Paragraph 10G2 re- lates to “argentine, albata, or German silver, unmanufactured, 35 per centum ad valorem.” That ought to go with the iron and steel. There is a class of German silver in it which forms part of the articles manufact- ured of it, which changes the rate of duty; that is, the argentine unman- ufactured does not come in except in sheets, which the department de- cided was unmanufactured, so that that can go in the general class of manufactures of metal. Commissioner McMahon. It would not come under the general class of manufactures of metal; but the department has decided that sh ets of metal are not manufactures. You would wipe that out altogether. The Witness. Yes, sir; I would. I would also strike out “brass in bars or pigs and old brass, fit only to be remanufactured at 15 per centum ad valorem” (paragraph 1063). Commissioner McMahon. Why should not old brass pay the same rate as old copper ? Ti le Witness. I think it ought to. Commissioner McMahon. We frequently have old brass and old copper coming in together in the same bag or barrel, and we have great difficulty in satisfying the importers in regard to it, as one pays a rate of 15 per cent, ad valorem, and the other 3 or 4 cents a pound. The Witness. There is old composition metal, and a composition of brass and copper, and old copper, and they all ought to pay the same L. mcmcllen. J APPRAISER^ DEPARTMENT, N. Y. 445 rate of duty. The next paragraph is number 10G4, Dutch and bronze metal in leaf. Commissioner McMahon. Why not put in the words “composition metal,” and make them pay the same rate as for gold and silver leaf al- so much a package of so many leaves ; or is it easier to fix the value? The Witness. Composition metal ought to be in there somewhere. I think I would let the paragraph remain as it is, at 10 per cent., and put in composition metal. Commissioner McMahon. Where would you put in the words “com- position metal;” would you put them in after the words “Dutch metal”? The Witness. Yes, 1 would; it is an imitation of gold. Commissioner Garland. You would have it read, then, “Dutch and bronze and composition metal”? The Witness. No, sir. Dutch and bronze metal is 10 per centum, and composition metal ought to pay 35 per centum, because an imita- tion of gold-leaf is much more expensive than the Dutch metal. Para- graph 1065 relates to articles made of gold, silver, German silver, and platina, and also paragraph 1066 to silver plated metal. Commissioner McMahon. You would strike that out (sec. 1065) and let it go to the section below? The Witness. Yes; and the next one, “silver-plated metal in sheets or other form.” The last clause is number 1068, “metals, unmanufact- ured, not otherwise provided for, 20 per centum ad valorem.” I do not think I would do anything with that. I would leave it as it is. Commissioner McMahon. That closes the sections. The Witness. Yes, sir. I would like to say something in regard to the charges and commissions. That is a very annoying thing in regard to the invoices. It is very difficult to locate the charges on inland goods, particularly as the department lias decided that the charges appertain to the frontier of the country where the goods come from. If the commissions and charges could be included in the dutiable value of the merchandise, it would be a good thing. Commissioner Oliver. Have you any idea what the average per- centage would be? The Witness. That depends upon the bulkiness of the goods. Commissioner McMahon. Under a decision of the department, if goods are made in an interior country, say in Switzerland, the charges accrue up to the frontier of Switzerland. The President. It would diminish the protection, would it not, to strike out the provision for charges and commissions? The Witness. Yes; but then you could increase the rate of duty. Commissioner Oliver. How would it do to say that a certain per- centage should be added in all cases in lieu of an addition for charges and commissions ? What would be the effect of that on these fine French goods, and on the common goods brought from Sheffield? The Witness. It would not be at all burdensome. It would depend upon whether the goods brought from Sheffield were fine or ordinary cutlery. How it would affect the French goods I do not know. I think it would be better to abandon the items altogether, or add a charge for them to the duty. Commissioner Oliver. The 2 J per cent, which is allowed now is under a ruling of the Treasury Department, is it not ? The Witness. No, sir; the law provides for that. Commissioner McMahon. The law provides that there shall be charges added, and then on that gross sum the law provides that a commission shall be added, not less than per centum. * 446 TARIFF COMMISSION. [L. MCMULLEN. Commissioner Oliver. Some people might object to the change of the duty. It has always been conceded that the matter should be figured on; that is to say, if the government is imposing a duty of 30 per cent., it is supposed to mean that amount of duty on the cost of the goods at the shipping point. I think it would be a good idea to abolish all charges and commissions and make a general charge of 5 per cent, to cover them, and add it to the duty. The Witness. Do you mean 5 per cent, to include both the commis- sions and charges? Commissioner Oliver. Yes; to include everything. What do you think would be the effect of that ? The Witness. I think that would work very well. Commissioner Oliver. Would not that in fact make the rate of duty about the same it is now ? The Witness. I think so. Commissioner McMahon. Would not 5 per cent, be more than the present average on merchandise in general, or above the present aver- age, including commissions? Do the charges, as a rule, amount to as much as the commission ? The Witness. Yo, sir; I think not. Commissioner McMahon. I think 3 per cent., would about cover the present charges and commissions, as they average. Commissioner Oliver. These items are burdensome now, especially in small lots and mixed packages, are they not ? The Witness. Yes, sir. Commissioner Oliver. On heavy lots and large invoices the charges, counting by percentage, would not be so heavy or so troublesome ? The Witness. Yo, sir. Commissioner Oliver. What is your opinion as to the practicability of making a home valuation instead of a foreign valuation? The Witness. I do not think that would operate as well. I do not think you could fix the home values as siyely as you can the foreign values. Commissioner Boteler. What do you think of the proposition to put spices on the free list ? The Witness. I do not think I am competent to give an opinion on that subject, as they do not come in my division. By Commissioner Garland: Q. What has been your experience as to the reliability of the invoices received; do you often find it necessary to change the valuation found in the invoices ; in other words, is there an attempt to evade the duty by under-invoicing? — A. Yes, sir; there are attempts at times of that kind. Q. Are those instances rare ? — A. We are constantly advancing val- ues, because of the advance in the value of merchandise. Take iron ore as an example. There are times when we advance nearly all the in- voices, when there has been an advance in the foreign market, where contracts have been made previous 1o the advance. Q. But my inquiry intended to cover the idea of whether these invoices were purposely made low to escape the payment of the full duty ? — A. ]S o, sir ; Ido not think they are, as a rule. Of course there are attempts to defraud the government in that way sometimes ; but I don’t think it is of frequent occurrence. By Commissioner Oliver : Q. Do you think from your experience (and you have had a great deal L. MCMULLEN.] 447 appraiser’s department, n. y. in this direction) that our consuls abroad make any attempt to be exact in certifying invoices ? — A. No, sir ; I do not think they do, as a rule. I do not think the consuls are of much aid to us here. Q. Do they certify the invoices just as they are offered, without at- tempting to ascertain the market prices ? — A. I presume not; but still they are not of much assistance to us in determining the value. By the President : Q. Have there not been cases where consuls have looked into the ques- tion of the market price, and certified from personal examination as to the value of the goods? There was a Mr. Abbott, at Sheffield, Eng- land, whom I think took special pains to attend to that matter ; do you recollect him ? — A. Yes, sir ; I do. Mr. Abbott was a very good consul indeed, and was on the alert all the time. My recollection of his work is very pleasant ; I know that on several occasions he aided mein getting information abroad that I could not otherwise have obtained. By Commissioner McMahon : Q. But such instances on the part of consuls are rare in your ex- perience ? — A. Yes, sir ; they are. 448 TARIFF COMMISSION. [W. S. HEADLEY. W. S. HEADLEY. Long Branch, N. J., August 15, 1882. Dr. W. S. Headley, assistant appraiser in the New York custom-house, upon the request of the Commission, made the following statement : It was suggested to me that I should note down a few points which have arisen in the line of my duties as appraiser of drugs and chemicals, and I have done so in regard to some articles, and in regard to certain gen- eral clauses of the law which affect my division as well as others. The first thing that suggested itself to my mind was the importance of mak- ing duties specific in all possible cases, instead of ad valorem. Commissioner Oliver, You recommend that duties in all cases be made specific instead of ad valorem? Before passing to other subjects, will you please give some reasons for that? The Witness. In the first place, specific duties lead to less compli- cation in the assessment of duties, and, in the second place, the im- porters and others who are interested understand just exactly where they stand. Under the ad valorem rate of duties importers sometimes do not know whether they are going to pay a certain rate of duty on an article, or twice as much. We are adding to the market value of goods every day on half of the invoices that come to us. If the duties were specific, it would not make any difference whether these goods were invoiced at one price or another. Commissioner Oliver. How do you add the market value; what process do you adopt ? The Witness. Sometimes articles come to us invoiced at, say, 30 francs per kilogram, and we make them 40 francs. It is very difficult to determine what the market value is so far away from the European market, and the information we receive is not always of the most satis- factory character. Sometimes perhaps we add enough, and sometimes not. Sometimes we add too much, perhaps, in order to make the market value. We act according to the best of our information ; according to the best opportunities we have of determining the market value. An appraiser in New York cannot tell what the market value of an article may be in Birmingham, Antwerp, Bremen, or some other remote place, and so we go through a process of consulting other invoices and getting such information as we can from them, making notations of value from them in our memorandum books, and that assists us in determining the market value of the invoice. Yet, at the same time, the value thus ar- rived at may not be enough to cover the market value at that precise period, or it may be more than enough. Changes in the price of the articles may have taken place since the date of previous invoices, so that our judgment in regard to the value at that time may not be cor- rect. If the duties were specific, it would not make any difference. An article that is dutiable at so much a pound, pays the same amount whether it costs 4s or 10s. For these reasons I would advocate specific duties. There are cases where you cannot make the duties specific, and then, of course, they lia\«e to be ad valorem. But I would make them specific in all possible cases. An importer or manufacturer, in order to succeed in his business, with the facilities before him, will some- times present an article that will commend itself to the trade as being superior in quality to the usual article of that class, and yet, at the same W. S. HEADLEY.] 449 appraiser’s department, n. y. time, it is produced in sucli a manner that it does not cost him one-half as much as the same article would cost when produced in another way. These matters come before us for decision. For instance, take a dye which cost« 2s. 6d. a kilogram ; it will dye as well as an article that costs 4 s. 6d. a kilogram and give the same shade and brilliancy. In that case it would appear to be invoiced too low. This manufacturer, by a new process, has produced this color so that he can offer it at a lower price, and it is not a matter of market value at all, because it maybe that the article will command all that it is really worth. But we are bound to bring it up to the standard article which we had before, and which has cost so much more. By pursuing that course, it seems to me we are placing a bar on the production of the most choice articles that a man of sagacity and experience can produce. But if a specific duty is put on it would not make any difference how much or how little the price of it was. Commissioner Oliver. Before you leave that branch of the subject, I would like to make one other inquiry. Most of the articles in the chemical line concerning which you have had experience can be assessed at a specific duty, can they not? The Witness. In my judgment most of the articles can. Chemicals, as a rule, are bought and sold by the pound, and a duty can be assessed just as well by the pound as any other way. They are also bought and sold by the kilogram and by the gallon. Of course there are excep- tions, but a very large proportion of the articles that come through my division are bought and sold by weight or measure, and a specific duty could be easily assessed. By Commissioner Oliver : Question. Do the articles that come in under your division fluctuate in value to any considerable extent? — Answer. Yes, sir ; there is more or less fluctuation on most of the articles that come in my division. I would be in favor of striking out all compound rates of duties. There are quite a number of articles that I could speak of in this connection. Perfumery pays so much a gallon, and also so much ad valorem. Var- nish also pays so much a pound, and so much ad valorem. By Commissioner Garland : Q. Why would you recommend the omitting of the compound duty; merely as a convenience in assessing the duty? — A. Yes, sir; chiefly as a convenience; and I see no good reason why duties should be compound duties. Take, for instance, the article of perfumery. Lubin’s extracts pay a duty of $3 a gallon and 50 per cent, ad valorem. I see no reason why the same amount of duty might not be assessed and collected by making it specific at so much a gallon, leaving off the 50 per cent, ad valorem. The ad valorem rate of duty, I think, stimulates people to per- petrate fraud in undervaluation of invoices, hoping that the appraiser will not detect them in so doing. I have noted another clause to which I would call your attention, and that is section 2499 of the tariff laws, which we generally call the u similitude” clause. There are three clauses to that section, the last one of which seems to be a trap intended to catch everything not included before. It says: u On all articles manufactured from two or more materials, the duty shall be assessed at the highest rates at which any of its component parts may be chargeable.” That may be a clause which would apply to textile fabrics appropriately; but as a general clause I object to it, because it applies to every other article as well as to textile fabrics. It may be suited very well to certain textile H. Mis. 6 29 450 TARIFF COMMISSION. [W. S. HEADLEY. fabrics and articles of import ; but as it stands here now, it is a gen- eral provision which applies to all imported goods. I would make it a specific provision for articles to which it would appropriately apply. Another clause which I have noted here in my memorandum is Xo. 983 (Heyl), which is as follows: “On all compounds or preparations of which distilled spirits is a component part of chief value, there shall be levied a duty not less than that imposed upon distilled spirits.” I would suggest that that be amended so as to read, “ except such preparations as are known to be and are recognized as medicinal preparations.” As it now stands it is liable to be applied to all medicinal wines and tinctures, and other medicinal preparations. It is very broad and sweeping in- deed. By Commissioner McMahon: Q. What do you mean when you use the words “such preparations as are known to be and are recognized as medicinal preparations”? Do you mean such as are commercially so known? — A. Yes, sir; commer- cially known or designated. Commissioner Oliver. Some people regard bitters as medicinal prep- arations. Commissioner McMahon. Bitters are specially enumerated. The Witness. Bitters are not medicinal preparations. Commissioner Oliver. Some people think they are, however. But under the suggestion you make, they could bring in a decoction of rum and a little tansy bark as a medicinal preparation, could they not? The Witness. I think not. But there is not a tincture in any drug store of which the basis is not distilled spirits. Commissioner Oliver. Patent medicines and so-called bitters could be made abroad and brought into this country under such a provision. The Witness. Under that provision, as it now stands, the rate of duty is $2 a gallon to be assessed on all medicinal wines, the wine of colehicum, the wine of ipecac, and all those medicinal wines, as well as the tinctures known and recognized as medicinal preparations. We do not so classify them. I wrote a report two weeks ago on medi- cinal wine where the duty which we assessed on it of 40 per cent, was changed at San Francisco to $2 a gallon. It was a medicinal wine im- ported by the Chinese, and admitted to be used for medicinal purposes arid not as a beverage. W^e had it analyzed by a chemist, and found that the medicinal property it contained had entirely disqualified it for use as a beverage; it was purely and unmistakably a medicinal prepara- tion. Yet, in San Francisco, under that clause, they put the duty at $2 a gallon. That occurred not ten days ago. We do not so classify here; but our classification was questioned there, and it went before the de- partment, and the question has not yet been decided. Another annotation I have made here is in regard to section 953, as follows : “Glass bottles or jars filled with articles not otherwise provided for, 30 per centum ad valorem.” That should be construed to mean glass bottles or jars filled with “articles not otherwise provided for,” not “glass bottles ” not otherwise provided for, but “ articles” not other- wise provided for. By Commissioner Kenner: Q. You mean the words “not otherwise provided for” should be ap- plied to the contents of the bottles and not to the bottles themselves? — A. Yes, sir ; that is the way it should be applied. 1 would amend that so as to read “except such as are the usual envelope for the mercban- W. b. HEADLEY.] appraiser’s department, n. y. 451 dise contained, if the same is contained in the price of the goods and not charged separately on the invoice.” Commissioner McMahon. Would it not be better to wipe that clause out altogether; in operation it is an insignificant one, is it not? The Witness. It amounts to a good deal if you take mineral waters and articles of that class. I should not object to having it stricken out entirely, but I do object to it as it now stands and is construed. Commissioner Oliver. It is nothing but a package. Commissioner McMahon. It makes the appraiser examine and ap- praise separately an article which is not charged for separately. He has to examine it; and, in an invoice amounting to $10,000, the duties on them will not be $100, or perhaps not even $50. The Witness. When that decision was first made it was made to cover goods that paid an ad valorem rate of duty, such as Lubin’s ex- tracts and chemicals contained in two drachm bottles. We had to go over the goods and put a value on each of these bottles so as to make out the rate of duty. I understand that suggestions in regard to the rates of duties are not desired by the Commission, and, therefore, I will not say anything on that point. I would strike out all charges and commissions. Duties are assessed upon merchandise, and the charges and commissions are claimed to be necessary expenses. So a man’s trip to Europe to purchase the goods is a necessary expense, and a great many other things are necessary expenses in connection with that purchase which would affect the value of the merchandise. But it seems to me that the same amount of duty could be collected if, for instance, a specific rate of duty per pound were fixed on an article with the commissions and charges added. I see no rea- son why, if the charges in the aggregate amount to 2 per cent., 2 J per cent., or 3 per cent., we might not add those amounts to the rate per pound and make it a part of the duty, and let these charges and commissions go; that is to say, make the rate of duty sufficiently large to cover the charges and commissions. I am adding charges every day to invoices where I do not know that any charges were ever paid ; I mean shipping charges. That is done under a decison of the department. I believe in some cases the goods were delivered free on board, and yet on every invoice which comes before me, where it does not say u free on board,” I must put shipping charges, whether I think the shipping charges were ever paid or not. And, as I look at it, it is a premium on falsify- ing the invoices. Many merchants put “ free on board ” on to get rid of adding charges if real charges have been paid. It strikes me that the same amount of duty might be collected and the revenue protected just as well by adding a little more to the rate of duty and leaving out the commissions and charges. Men can state such and such items to be charges when they have really paid other charges. By Commissioner Oliver: Q. You think it would be feasible to fix upon a rate of 2£, 3, 4, or 5 per cent., or whatever rate is settled upon (a fair rate), and add it to the duty in lieu of all charges and commissions? — A. Yes, sir; that would do; add such a per cent, to every invoice. By the President : Q. Can you form any general estimate as to the amount which the charges add to the duty? — A. No, sir; I cannot. I have not given the matter any thought. The commission usually paid is 2J per cent. I 452 TARIFF COMMISSION. [W. S. HEADLEY* think 3 per cent, will cover all charges and commissions, allowing the ordinary commission to remain at 2J per cent. The 2J per cent, com- mission's a rather arbitrary rate, I believe. Commissioner McMahon. You mean the law is arbitrary, of course* The Witness. I have no doubt that 2£ per cent, commission has fre- quently been put on an invoice when no commission has been paid; at the same time the law requires that a 2J per cent, commission shall go on. These are the main points that have occurred to me in the limited time I have had at my disposal since I was notified that you desired to have me appear before you. I have made notes in regard to rates of duty, but I suppose the Commission do not desire me to state in regard to that. By Commissioner McMahon: Q. How many articles are there passed in your division which are of such small value or quantity that they might be put upon the free list without much loss of revenue, comparatively ; or, can the free list be enlarged materially or considerably by any articles passed by your division, without much reduction in the revenue ? — A. I could not answer that question now without first refreshing my memory by looking over the schedule. Commissioner McMahon. I am of the opinion that that could be done. A great many things come under your division on which a duty is charged, where the total revenue received does not amount to very much. W. B. HOT'I.J WORSTED DRESS GOODS. 453 W. B. HOYT. Long Branch, X. J., August 16, 1882. Mr. W. B. Hoyt, assistant appraiser, fifth division, appraiser’s de- partment, New York, made the following statement : I have charge of the division in the appraiser’s department through which are passed gloves, worsted dress goods, artificial flowers, knit goods, and articles of that character. I come before you supposing the Commission desire to make inquiries of me in regard to the line of goods under my charge, rather than to submit any voluntary statement of my own. There are inconsistencies and incongruities in the tariff in refer- ence to various lines of goods which come under my supervision. Commissioner Oliver. It is our desire to ascertain from parties com- petent to give us the information everything that is troublesome and wrong in the working of the present tariff, and we should be obliged if you would indicate such conflicting provisions of the law and suggest any remedies that may occur to you. The Witness. Section 1166, of Heyl’s Digest, is the section under which dress goods are provided for. We find, in practical experience, this difficulty, and it has been a very serious difficulty in the past ; it is almost impossible to determine at times what are, strictly speaking, dress goods. There are so many materials manufactured apparently for women’s dresses, which are used by gentlemen, that the line of de- markation between the fabrics made for men’s use and women’s use is very indistinct at times. I have had to submit to the department many s. HOYT. The President. What do you suggest as an amendment to that? The Witness. My suggestion at that time was, that gloves should pay a specific duty. If valued at $4 or less at the port of shipment, they should pay $2 per dozen; if valued at over $4 per dozen, they should pay $3.50 per dozen ; if valued at over $12 per dozen, they should pay $6 der dozen. Commissioner Oliver. Yon would consider that to be merely a sub- stitute for the present ad valorem duties, figured out in that propor- tion? . The Witness. Yes, sir; the difficulties are very great in ascertain- ing the values of kid gloves, especially in the smaller ports of the coun- try, where the examiners have such a varied line of duties to perform that they cannot become experts in specialties. Mr. Leseur has made a specialty of kid gloves, which belong to his department, so that he can distinguish a kid glove from a lamb-skin glove, and that is difficult to do without experience. By Commissioner Kenner : Q. There is one point I wish you to illustrate. In making up the value of an article presented for importation the duties on which are to be paid on the ad valorem principle, the law directs that you shall add charges and commissions. I understand what commissions mean perfectly well, but I desire to know precisely what the word charges covers ? — A. The nature and character of the charges provided for are enumerated in section 2907, Heyl’s Digest, as follows : M The cost of transportation, shipment, and transhipment, with all the expenses in- cluded from the place of growth, production or manufacture, whether by land or water, to the vessel in which shipment is made to the United States ; the value of the sack, box, or covering of any kind in which such merchandise is contained.” Q. Do you consider the cost of transportation from the place of manufacture to the seaport where the goods are shipped as one of the charges ? — A. Yes, sir. Q. You include that item of freight in the charges ? — A. Yes, sir ; All the transportation charges from the place of manufacture to the seaport. If goods, for instance, are purchased at Bradford, England, the charges to the seaport must be added to the invoice. By Commissioner Garland : Q. How do you ascertain the charges from an inland port ?— A. The current prices of transportation are published in England as they are in this country, and by a comparison of the charges in one invoice with the charges made in another invoice this can be ascertained. The cost of making boxes and the cost of transportation are items of value as easily understood as other elements that enter into the value. By the President : Q. And they are all incorporated in the invoice ? — A. They should be ; if they are not we add them. By Commissioner Garland: Q. Do you have occasion to change the charges much? — A. Yes, sir; we frequently have either to change the charges or put them on the invoice. Q. If the charges are not named on the invoice do you accept the invoice as correct? — A. No, sir; no more than we do other values. W. B. HOYT.] WORSTED DRESS GOODS 461 The amount of charges is subject to our appraisement as well as the i ntrinsic value of the articles themselves. Q. Are they often changed? — A. Yes, sir; additions for charges are often made. By Commissioner Oliver : Q. Does not this matter of charges give rise to a great deal of trouble? — A. Yes, sir ; it does. Q. Could you name a percentage as regards the goods coming under your supervision which could be made in lieu of these charges as an addition ? The rate of commission seems to have been settled at 2J per cent. ; what additional percentage would cover the cost of charges? — A. They would vary on the different classes of goods. Q. What would be a proper amount sufficient to protect the import- er and the government and be satisfactory to all parties? — A.* I should say from 1J to 2J per cent, would be a proper figure. Q. You think, from your experience, that that would cover the cost of boxing, freight, and charges, say from Bradford to Liverpool, or to the nearest shipping point? — A. Yes sir; the ordinary charges. But some of the goods in my line are purchased in paper boxes, and the appraisers of these different classes of merchandise know when they are included in the prices of the goods themselves. If you buy a dozen pairs of stockings here in a carton, you pay for the carton when you pay for the stockings and take it with you. Throughout Europe that is the usual way of buying those goods. In England they usually make an additional charge for the carton. Q. Do you notice many goods marked “Free on board”? — Yes sir. Q. There are no charges in such cases, are there? — A. No sir; un- less we conclude it is a doubtful matter. Parties may put F. O. B. on their invoice when the facts do not warrant it, and that is another point we cannot always determine. The percentage of cost would be so small that we could not say that the value is not covered by the invoice, including free on board. Q. Do you know of any matter which has given rise to greater com- plaiut on the part of importers than this matter of charges? — A. It is a matter concerning which numerous complaints have been and are being made. The whole subject is very annoying. It is trifling in amount usually and is not worth the trouble it costs both to the import- ers in getting their invoices through the custom-house and to the custom-house officials. By the President : % You would recommend, then, the adoption of a certain specific per- centage instead of the allowance for charges? — A. Yes, sir, I would; I would recommend an additional 5 per cent, to be put on, to cover all charges and commissions. By Commissioner McMahon: Q. Does not this matter of charges frequently throw goods from one rate of duty into another rate of duty ? — A. Yes, sir, it does. The divid- ing line of 20 cents a square yard on our worsted dress goods is often affected by this little matter of charges. It sometimes happens that goods that will pass at 6 cents per square yard and 35 per cent., if there be forty pieces in a case, will pass at 8 cents per square yard and 40 per cent, if there be only thirty-nine pieces in a case. So that we get two rates of duty on precisely the same class of goods on account of 462 TARIFF COMMISSION. [W. B. HOYT. this trouble we have in the matter of charges. Now, if there was a rate of 5 per cent, or 3 per cent, or any percentage that is thought proper to cover these charges and commissions the importers would not have so much reason to complain. It is not so much because of the amount that complaint is made, but they want some uniform rate; of course, they do not like to pay different rates of duty on the same goods. E. C. LESEUR.] KID GLOVES. 463 E. C. LESEIJB. Long Branch, N. J., Avgust 16, 1882. Mr. E. C. Leseur, examiner, kid glove division, New York custom- house, made the following statement: I would state that* in my judgment, based on four years’ experience in examining leather gloves at the port of New York, the most just and equitable form of duty is an ad valorem rate of duty, providing that certain safeguards are placed around the importation of these goods. For instance, I think the examiner of leather gloves should be allowed to devote his whole time and attention to the matter of gloves, and that all gloves coming into the port of New York should be inspected and appraised. If it is deemed desirable to change the rate of duty on leather gloves, *1 would present for your consideration the following as a basis : I would suggest that upon all leather gloves the foreign market value of which is less than $10 a dozen, a specific duty of $1.50 per dozen and 20 per cent, ad valorem, should be put. On all gloves costing more than $10 or $12 a dozen there should be a duty of $3 per dozen and 20 per cent, ad valorem, and on all lined leather gloves or leather gloves trimmed with fur, a duty of $3 per dozen and 20 per cent, ad valorem. The ad va- lorem duty would be so small that there would be no temptation for manu- facturers or consignors to undervalue their invoices. In my opinion it would bring in an amount of revenue to the government equal to that which is now received. I have kept a record of the quantity of gloves imported into the port of New York for the year 1879. My record shows the number of dozen of kid and lamb skin gloves, for men’s, women’s, and children’s wear, also the invoice value and the appraised value, with the average price per dozen, of kid and lamb skin gloves, and the total num- ber of dozens imported during the calendar year, as follows : KID GLOVES. Number of dozen of men’s gloves 22, 886 Number of dozen of women’s gloves 200, 316 Number of dozen of children’s gloves 4, 065 Invoice value $1, 607, 348 Appraised value 1, 794, 128 Charges and commission, 4 per cent 71,765 Total 1,865,893 Average price per dozen, $8,21. LAMBSKIN GLOVES. Number of dozen of men’s gloves 21, 693 Number of dozen of women’s gloves 329, 856 Number of dozen of children’s gloves 4, 673 Invoice value $1, 421, 896 Appraised value 1, 465, 561 Charges and commission, 4 per cent 58, 622 Total 1,524,183 Average price per dozen, $4.27. Total number of dozen leather gloves imported during 1879 583, 489 Total value $3,390,076 Total duties 1,695,038 Total advance in value by appraiser 230. 445 464 TARIFF COMMISSION. [K. C. I.ESEl’R. I have also in my book a similar record for the year 1881, and for the year 1882 up to the present time, but it is not footed up, and it would take two or three days to condense it in this form. At the pres e-nt time there may be 600,000 dozen gloves imported per annum at the port of New York valued at $3,500,000, on which the present duty would be $1,750,000. If there is a duty imposed of $1.50 a dozen on 600,000 dozen that would be $900,000, and 20 per cent, duty on $3,500,000 would be $700,000, and the extra duty on gloves costing over $10 per dozen and on lined or fur- trimmed gloves would bring the amount up to about the same that we are receiving now at the present rate of duty. By the President : Question. What is your reason for recommending a compound duty t — Answer. Because if it was a purely specific duty it would discrimi- nate in favor of the importers of French gloves and against the importers, of German and Italian gloves. It would have the effect of driving the Italian or lower-grade gloves out of the market, and poor people who desire to live economically would have to pay a larger amount of duty, while those who could afford to pay for fine gloves would not have to pay as much duty in proportion to their value. By Commissioner Garland : Q. I understood you to say at the beginning of your remarks that the present ad valorem duty was the best, in your judgment? — A. Yes, sir; because it bears equally on all grades of goods. Q. You prefer that to a compound duty? — A. Yes, sir; but if it is necessary to make a change in the rate of duty, I would recommend a small ad valorem duty and then a specific duty of, say, $1.50 a dozen. The ad valorem duty would be so small that even if the gloves were undervalued it would not afford one importer any great advantage in competition with other importers. Q. What proportion of the invoices that you pass do you find it nec- essary to raise? — A. We raise a great many; I could not tell you what proportion. Q. Do you raise one-half of them? — A. I do not think we do at pres- ent ; four years ago we did. Q. Do you raise one-quarter of the invoices at the present time? — A. Most of the invoices are raised on entry, the same class of gloves that there was a contest on four years ago. Four years ago an importer would invoice a glove at 17 marks, and it would be advanced to 20 marks per dozen. If under the reappraisement it was placed at 20 marks, he would write to the consignor on the other side and tell him to make the invoice out at 20 marks, so that the invoice would not show any advance, as the gloves would be invoiced at 20 marks. But other houses have for the past four years invoiced their gloves at the same prices that they invoiced them at previous to the time the question came up in regard to their market value; and on entering them the importer adds to the invoice to make up the market value. We have a glove in- voiced to-day at 30 francs per dozen and 26 francs per dozen added, to make the market value on entry by the importers to bring it up to the price that they were appraised at. For instance, take a Swede glove that was entered originally at 20 to 22 francs three or four years ago ; it has been advanced until now they pay duty on 38 francs for the same glove, and on entry they add the difference between 22 and 38, and on the longer gloves they add up to as high as 26 francs per dozen. E. C. LESEUR.] KID GLOVES. 465 By Commissioner Oliver : Q. You say that, personally, you prefer an ad valorem rate of duty! — A. I do. Q. You think that is the fairest way of assessing the duty! — A. Yes, sir, I do, providing the examiner examines all leather gloves which come into port; at present he gets only a part. Q. You are expert in your business, and most of the gloves imported into the country come through the port of New York ; as a result I suppose the very best talent in that line is employed to appraise these goods. But what are they to do in the interior ports, where the importations are small and the appraisers have to examine all classes of goods, not only kid gloves but pig iron, chemicals, and everything else that comes into a port. How can the appraisers at such places tell when an article is undervalued ! — A. In regard to gloves, I may say that very few gloves come into any port except New Y r ork. When new goods, or goods which the appraisers are not familiar with, are brought into interior p>orts, the officials are very apt to send samples of such goods to the New York custom-house for our opinion upon them. Q. Verj- likely they would; but I am speaking of instances where they do not do that. Take the whole country, with its innumerable ports and its continually increasing business ; would not the proper way of collecting duties be to assess a purely specific duty in lieu of these compound duties, so that equal justice could be done to every importer, whether he is a merchant doing business along the banks of the Mississippi River or in New T York City! Can the appraisers all over the country tell about the value of these goods! — A. No, sir; be- cause it is a matter that requires constant study and long experience. In that case a compound duty would be preferable. Q. Cannot a purely specific duty be imposed! — A. No, sir; I do not think it could be with justice to the importer or consumer. The President. Under the present circumstances, as the whole country is interested in this matter, do you prefer the system you re- commend — a compound duty ! The Witness. Yes, sir; 1 do, taking the interests of the whole country into consideration. By Commissioner Garland : Q. I understood you to say that you yourself preferred an ad valorem rate of duty. — A. Yes, sir, I do ; but, taking the matter as it affects the whole country, perhaps a compound duty would be preferable. Q. Then you recommend a compound duty instead of an ad valorem duty, do you ! — A. As it affects the whole country, I do. I do not know anything about the qualifications of the examiners of gloves at other ports, but, as I have said, very few psloves are entered at other ports than New York. I pass upon ten different lines of goods. The inspec- tion of gloves is only a small portion of my duties. Of course at other ports tLe examiners cannot be as expert in this matter as we are at New York, where four-fifths of all the gloves imported into the United States are entered. I recommend that all gloves should be ordered in for examination in the event of an ad valorem duty or a continuation of the present duty, and I will give you my reason for that. For in- stance, an invoice comes here with ten cases of gloves on it, the deputy collector orders one case to be sent to the public store for examina- tion, and the balance (the nine cases) go to the importer’s store. The importer receives his nine cases within a couple of days. In the mean time the other case is received at the public store, and is examined by H. Mis. 6 30 466 TARIFF COMMISSION. [E. C. LESEUR. the examiner, and we will say that, in his judgment, the goods are in- voiced at less than their actual market value. In that case he orders in all the other goods for examination, supposing they must he all under- valued. In the course of twenty-four hours the importer receives a notice that his goods have been ordered to the public store. “But,” he says, “I have not got them; I had to send them to my customers. I have opened the cases and disposed of the bulk of the goods.” What is to be done in such a case as that? There is no certainty that the gloves returned to the public store (often the cases have been opened at the importer’s store and their contents partly disposed of) will fairly represent the original importation. I have ordered goods back to the public store where I was well satisfied that they did not represent the value of the original importation — goods which had apparently been on the importer’s shelves for six months or a year. That is the reason why I recommend that all gloves imported shall be ordered in for examin- ation. By the President : Q. What change in the law would you recommend in order to accom- plish that? — A. Merely that all leather gloves shall be examined and appraised. By Commissioner McMahon : Q. If the appraiser requested the collector to send all the goods to the public store, would it not be done ? — A. Yes, sir ; I suppose it would. I have requested it to be done, and it has been done for a year or more, and then only one case in ten would be ordered in, unless another special request was made by the appraisers. Commissioner McMahon. Then it is a mere matter of internal dis- cipline and regulation. There is no amendment of the law necessary. The Witness. But if all cases were ordered in for examination an ex- examiner of a particular line could examine all those goods. Commissioner McMahon. But still it is a mere matter of internal dis- cipline and regulation. The President. Have you any recommendation to make in regard to other goods? The Witness. No, sir; I have not. Commissioner Oliver. Or in regard to the working of the act relat- ing to gloves or other goods which come under your supervision ; that is, have you noticed any contradiction in the wording of the present law where you could suggest a change? The Witness. No, sir. By Commissioner Garland : Q. Do you examine feathers as well as gloves? — A. Yes, sir. Q. Have you had any trouble of late in that line ? — A. No, sir ; I have not. I examine only crude feathers. By Commissioner Oliver: Q. Would it be possible in your line of goods to put a home valuation instead of a foreign valuation upou them? — A. No, sir; I think not. There is no staple home valuation for goods of this class. GUSTAV SCHWAB.] IMPORTED WOOL. 467 GUSTAV SCHWAB. Long Branch, H. J., August 16, 1882. Mr. Gustav Schwab, of Hew York City, importer of wool, made the following statement : I desire to state to the Commission that my business has made me familiar with the tariff on raw wool. I have imported raw wool for a number of years from all quarters of the world, and have also bought and sold considerable quantities of American or domestic wools. The members of the Commission are probably aware that in every attempt that has been made to revise the tariff by Congress for a number of years, wool has always played a conspicuous part, from which it may be inferred that the wool tariff contains a good many objectionable features. If I were allowed to follow my own convictions, I would make an argument in favor of free wool, and try to show that such a change would be the greatest possible boon to our large woolen industry, while its effect on the wool-growing interest would in no way be destructive. Believing, however, that such an argument would not be acceptable to your body, I propose to confine myself to those features of our present complicated wool tariff which do not affect the principle of protection to our wool growers, and which can be shown to operate to the detriment of our woolen industry, of the honest importer, and of the revenue. By our present tariff all raw wools are divided into three classes, viz, clothing, fine combing, and carpet wools, each class being made subject to a different duty. Experience has proved that this country cannot and does not produce all the necessary qualities, or a sufficient quantity, of either of these three classes, and that our varied industry requires a greater or smalller an- nual supply of foreign wools of all three classes. The effect of the tariff, however, is different on each class, and they have, therefore, to be con- sidered separately. Class I. Clothing wool is subject to a specific and ad valorem duty combined, the specific duty being the main charge j there are two rates, the lower one being applicable to wool, the foreign value of which, ex- clusive of charges, does not exceed 32 cents per pound of unwashed wool, and the higher rate to wool costing over 32 cents. This distinc- tion frequently compels our manufacturers to use a grade of wool inferior to what is really wanted, the latter being placed beyond their reach by the higher duty. On washed wool of this class the rate of duty is doubled, and scoured wool has to pay treble duty. Both washed and scoured wools, which form a large portion of the supplies of European markets, are thereby excluded from our markets, since the double and treble duties exacted by this provision of our tariff far exceed the duty imposed on the unwashed wool, which falls on the scoured wool when cleaned here. Our industry is therefore compelled to rely entirely on a supply of unwashed wool of this class, and to pay transportation charges on 50 to 75 per cent, of impurities contained therein. By far the greater portion of the duty being specific and assessed by 468 TARIFF COMMISSION. [GUSTAV SCHWAB. weight, our tariff discriminates against all heavy and dirty wools, which are made correspondingly cheaper to the European manufacturer, and our manufacturers are compelled to compete exclusively for the lighter classes of foreign wools, though their intrinsic qualities may he, and in fact usually are, inferior to those of the heavy wools. These disadvan- tages would disappear if in the place of our present complicated rates a uniform and simple ad valorem duty were imposed on all tine wool, unwashed, washed, or scoured. As to the proper rate to be imposed, I will only remark, that by far the largest portion of wools produced in the United States, including all California and Texas wool, is of a medium grade, the value of which is already so low that no foreign wools can be imported which can com- pete with them at any rate of duty. As the carcass of the sheep becomes more valuable, the raising of merino sheep grows less and less profit- able; and as our population increases, the present high duties become less and less effective for the protection of tine-wool growers, and very little, if any, depreciation of even fine domestic wool is to be apprehended from a moderate ad valorem rate, say 25 per cent., on all clothing wool. The present duty on Class II, tine combing wool, differs from the duty on clothing wool mainly in this, that washed combing wool is admitted at the same rate as unwashed, and that this class, therefore, is imported exclusively in the washed condition, which places the consumers of this class on a much more favorable footing than that of the manufacturers using clothing wools. There are, however, peculiar provisions, which it is not necessary to specify, that interfere with the easy importation of wool of this class, and which would be removed by making it subject to the same ad valo- rem duty that is recommended for Class I, and by thus removing all distinction between the two classes. Class III. Carpet wools now pay a simple specific duty, graded ac- cording to the foreign first cost or value of the wool, exclusive of charges at the last port or place of shipment, the duty being 3 cents per pound when this first cost does not exceed 12 cents per pound, and 6 cents per pound when the first cost is over 12 cents. I have been informed, and your president probably will confirm the fact, that when these two rates of duty of 3 and 6 cents were proposed, it was assumed that the lower rate would apply exclusively to unwashed carpet wool, while the higher rate would fall only on washed wool of this class. But the law makes no reference to any such distinction, and the first cost is therefore the only criterion by which the rate applicable to carpet wool of any condition is determined. In practice the above-men- tioned expectations of the framers of our wool tariff have proved entirely fallacious, since during the operation of this tariff, various peri- ods have occurred when prices of coarse wools were depressed so low as to allow even the best white washed wools to be bought abroad below 12 cents first cost, and to be entered here at 3 cents duty, while at other times the better grades of unwashed wools were too high in value to be brought in here at 3 cents duty. Aside from the fact that such assessment of duties discriminates against and generally excludes from our markets the numerous half- washed wools of this class, which frequently cost over 12 cents, but are not clean enough to bear the 6 cent duty, this so-called low duty limit has proved a great source of vexation to the importers and their cus- tomers, and has undoubtedly caused more fraud and evasion of duties than any other of the intricate features of our wool tariff. The honest importer is continually prevented from buying abroad wools costing a GUSTAV SCHWAB.] IMPORTED WOOL. 469 little over 12 cents, which his less scrupulous competitor brings in here at 3 cents duty by invoicing the excess of cost over 12 cents under the guise of fictitious charges, and by various other manipulations of a sim- ilar kind. If desired, I should have no difficulty in substantiating this particu- lar part of my statement by further details, and to prove that this assess- ment of varying duties according to the first cost of the article is a most serious error that calls loudly for correction. This evil would be undoubtedly corrected by the imposition of a simple ad valorem duty, which duty would, however, have to be a lower one than is likely to be imposed on wools of Classes I and II, since the present specific duty on carpet wool will be found to average little if anything over 20 per cent, ad valorem. I submit, however, that what is really called for with regard to car- pet wool, Class III, is the abolishment of all duty, and its being placed on the free list, since there is nothing of any consequence in this class of wool produced in the United States. Certainly 90 per cent, of all wool consumed by our carpet mills is of foreign origin, and what little short coarse wool is produced in this country would scarcely be affected by such a change, which on the other hand would enable our carpet industry to compete with its products in foreign markets. I submit that a simple ad valorem duty on wool is capable of being controlled by our appraisers with greater facility than can be d< newith almost any other raw material. In most foreign markets wool is being sold in periodical public sales, and where this is not the case, sales gener- ally are reported in public and private prices current, and the value of any class of wool at any particular time and place is therefore accessi- ble and generally known all over the world. This low-duty limit is really an abominable nuisance. I will give you an instance illustrating it, which has been developed in a suit which is pending at the present time. A large portion of these carpet wools come from Eussia. In Eussia they are bought and washed, and are contracted for, usually between the months of January and August. When we make a contract, we pay the peddler or agent who promises to briug in the wool two-thirds or three-fourths of the value of the wool in cash. But we are unable to fix the price. The price of the wool is fixed at the large fairs which are held in different parts of Eussia in the chief cities and towns, in July, August, and September, and sometimes we have had to fight for the price until October. We have had occasions arise where the wool which we bought and paid for in January, Feb- ruary, and March, was delivered to us in May, washed, and shipped to New York, where it arrived before we knew what the first cost would be. We cannot change that order of business. It is the order of business in Eussia, not only in regard to wools, but in regard to wheat, linseed, and everything. By Commissioner Oliver: Question. If that is the case, and it is so difficult to arrive at the price, why do you advocate an ad valorem duty? — Answer. If it is an ad valorem duty, we know within 20 or 25 per cent, what we have to pay. Q. But you have just been telling us of the difficulty you have in as- certaining the value of the wool you have advanced on. — A. Yes, be- cause the value depends upon whether the duty is 10 or 12 cents. There is the unwashed wool ana the washed wool. The washed wool contains 50 per cent, more wool than the unwashed, according to the bulk. 470 TARIFF COMMISSION. GUSTAV SCHWAB. Q. How would it do to put a duty of 50 per cent, upon every pound of wool? — A. If you could place a certain duty on the unwashed wool, and double the rate on washed wool, that would do. Q. But you have just stated to us that you cannot ascertain the cost of the wool sometimes until months after the time it has been bought. How is it possible for you to take a consular invoice, and assess an ad valorem rate of duty, when you do not know what the wool has cost you until three months after you receive it? — A. There are some kinds of wool sold, cash down, and that establishes the price, but not for the contracts. The consul would have to certify to an invoice at the price of the wool at the time of his making the certificate. Q. 1 do not understand why it is that you should advocate ad valorem duties while you are at the same time explaining to us that in regard to this important article of wool it is impossible for you to ascertain the price of it until long after the time at which you receive it in this coun- try. You recommend that the duties be assessed on the cost, and yet you do not know the cost until two or three months after the goods arrive. — A. But of course you are aware that the ad valorem duties are assessed, not only on the cost, but on the market value. If the cost can- not be obtained when the invoices are made out, the shippers take the market value. Q. I am aware of that; but would it not be better in regard to sugar, wool, and other articles of that class to assess the duties at fixed rates per pound ? — A. But there again comes in the difficulty of dis- tinguishing between the different kinds, and that is the trouble we labor under at present. If you say the duty shall be 3 cents on un- washed carpet wool, and 6 cents on washed carpet wool, what should be done with all the half washed wools ? Commissioner Oliver. Put another price on them. The Witness. Then you would have to have a running scale of duties of 30, 40, or 50 per cent., or else do injustice. But this low-duty limit is the thing which I would like to have abolished. We are now in this condition : Last year the Russian washed wools had to pay G cents duty, and there was no doubt about it ; there was no question raised in regard to the duty. The New York market was not affected at all. But this year the wools have gone down, and the price now being paid on the Black Sea for the unwashed wools is within 2 or 3 per cent, of the low- duty limit when the wool is washed. It is just a question of whether we can bring our wools here costing 12 cents or under, or whether they will enter over 12 cents here as white washed wools. That has disorganized the whole marketfor about4,000 balesof last year’s wool that is still lying on our market. We can sell nothing because we do not know whether the new wools pay 3 or 6 cents duty. If it is 3 cents duty we are all right; if not, we have to lose the rate. It is a variable thing. If I buy wool in Moscow or anywhere in the interior of Russia, it is always sold there packed and ready for shipment. If I buy it there for 14 cents 1 must invoice it at 14 cents, packed; and the few charges and brokers’ commissions of 3 or 4 per cent, are added. That wool, when it comes here, will pay 6 cents duty. Another man buys the same wool offered to me at 14 cents in Russia, and he has it forwarded to Riga, the great port of Russia, and there has it invoiced at 12 cents with 25 j)er cent, charges on it, and brings it in here at 3 cents duty. That is being done all the time, so that 1 cannot buy wools in Moscow. By Commissioner Garland: Q. Would the imposition of an ad valorem duty prevent that? — A. Yes, sir. The aggregate amount of these invoices is correct ; but, as I GUSTAV SCHWAB.] IMPORTED WOOL. 471 have said, they take 1, 2, or 3 cents off the cost of the wool and in- voice it as charges, and the appraiser cannot find it out; he cannot tell whether that is correct or not. Q. I understood you to state that washed wools shrink about 50 per cent. — A. Carpet wools usually do. We lose about 50 per cent, in the washing on these Russian unwashed wools. Q. What do you lose on the washed wools? — A. They shrink from 7 to 12 per cent. Q. How much do the scoured wools shrink? — A. They ought not to shrink any; but they are never imported scoured, because they would have to pay 18 cents duty. When the washed wools go over 7 to 12 per cent, they are called half- washed. Q. In speaking of combing wools, you referred to the fine combing wools; is the clause in the tariff worded in that way? — A. Yes, sir; it says 4< combing wools, viz: . Leicester, Cotswold, Lincolnshire, down combing, Canada long wools, or other like combing wools of English blood,” &c. Q. Those you term fine combing wools? — A. Yes, sir; in contradis- tinction to the fine combing carpet wools. Q. You do not mean, then, the fine merino wools which are combed? — A. No, sir. Q. You have spoken of certain disadvantages surrounding the impor- tation of wool, but I do not think ;you enumerated them; will you please enumerate some of them?— A. I will specify a few that occur to me. These English combing wools are imported here by only a very few manu- facturers, who use them to a large extent and who have their buyers in England. Under the law they are not allowed to buy the wool as it is sold in the English market, where there are a great many portions of the fleeces that they do not want. According to the law they must buy them as they are usually sold in the English market; but that does not suit them, and therefore they have to get up establishments there for sorting the wool and shipping to the United States only that portion which they want. That, strictly speaking, is illegal; some people con- sider it illegal. So that the importer never knows what he can do. A few large manufacturers do that, but the importer is always afraid of doing it. Then another question frequently arises, as to whether Aus- tralian wool should come in under the class of combing wool or under class No. 1 ; whether it can be imported in the usual condition at the simple rate of duty, or whether it has to pay the double rate of duty. There are Australian wools derived from this same class of sheep that the tariff speaks of, that is to say, the Cotswold and the Leicester, pro- ducing these long English luster wools. But when they are produced in Australia, if they are brought from there the importer runs great risk of the custom-house inspector saying to him, “I find a few fleeces of wool in these bales, of merino blood.” That is the difficulty ; and, therefore, we cannot import these combing wmols except from England, where the different classes of wool are kept distinctly separate. Q. Are you acquainted with the mestizo wools? — A. Yes, sir; I im- port a great many of them. They come in under class No. 1. Q. What would these wools pay under your suggested arrangement of 25 per cent.? — A. The value of mestizo wools varies from £9 ster- ling to £11, at Montevideo and at Buenos Ayres, or £8 sterling, for the lowest grade. From 16 to 22 cents is the value of the unwashed wool. Twenty-five per cent, of that would be from 4 to 5 or 5£ cents. They now pay about 12 J cents. Q. What would x>robably be the effect on the production of fine wool 472 TARIFF COMMISSION. [GUSTAV SCHWAB. if the United States should admit these wools at 4J cents? — A. Ido not believe it would have any great effect. Q. Do you mean that they would not be imported? — A. Ok, yes; they would be imported, but it would not have much effect on the price of our domestic fleece wools. It would take the place only of our American fleece wools, but the supply of American domestic fleece wools is already insufficient for the wants of this country. The result would be, we should import a larger quantity of mestizo or Buenos Ayres wools, which are almost excluded by our tariff now, on account of their heavy weight We used to import from 20,000 to 30,000 bales of these wools before the present tariff was enacted; now we only import from 1,000 to 2,000 bales annually. Q. What wool takes the place of that mestizo wool? — A. We use more Australian wools now because they only shrink 54 or 55 per cent. Q. What portion of the fine merino wools used in our manufactures are grown in this country? — A. More than 75 per cent., undoubtedly. Q. Where does the deficiency come from ? — A. From Australia, from the Cape of Good Hope, from the river Plate, and from a few other countries, but not to a great extent. For the last ten years we have imported from Australia from 5,000 to 30,000 bales per annum, accord- ing to the state of the market. Q. What is the average duty paid upon wool ? — A. Upon unwashed wool about 12 to 12^ cents. The duty is 10 cents per pound and 11 per cent, ad valorem, and the ad valorem price in Australia is about 25 cents. That brings it from 12 to 13 cents,, I might say. Cape wools pay from 11J to 12 cents. Q. Have you ever heard of sham or mock sales of wool being held in order to fix the foreign price which importers are obliged to pay for their wools ? — A. Uo, sir ; that could never be done to any extent. A quarter of a penny variation is a very important item in the purchase of wools. All merchants know every day the price of wool at the Cape of Good Hope and in Australia ; the price is telegraphed all over the world. Frauds that could be committed under a regular ad valorem duty would be very small indeed, and, I think, such a duty would do away with a great deal of difficulty. The appraisers now are obliged to have several hundred different samples in every custom-house as standards for them to go by. Commissioner Kenner. You made a statement at the commencement of your remarks to which I wish to call your attention. You said: If I were allowed to follow my own convictions I would make an argument in favor of free wool, and try to show that such a change would be the greatest possible boon to our large woolen industry, while its effect in the wool-growing interest would be in no way destructive. Believing, however, that such an argument would not be accept- able to your body, &c. I would like to know upon what that belief is founded. Why do you think that such an argument in favor of free wool as you speak of would not be acceptable to this body ? The Witness. Because I believe that, as your president told me Commissioner Kenner. I want your answer to that question. You seem to be acting upon a theory, which exists in the minds of some peo- ple, that this Commission is not disposed to treat everybody fairly and squarely; at least I infer that from your argument. The Witness. Oh, no; but I believe this Commission is required to, and is looking at other things connected with the tariff than those that merchants are asking for simply. You have political considerations which surround you. GUSTAV SCHWAB.] IMPORTED WOOL. 473 Commissioner Kenner. Ko, we have not, and you have no authority to say any such thing. You have said that you believe that an argu- ment presented by you advocating free trade would be unaccepted by us. I ask you what you predicate your belief on, and I have a right to put that question to you, because you have made the assertion boldly and unequivocally, so that it goes abroad to the world, and if we submit to it we submit to the assertion that we are disposed to be unjust and un- fair in our consideration of this question. I should like a definite an- swer on this point. The Witness. I did not intend to make any reflections upon the Com- mission, but having been before Congressional committees a number of times in reference to this same subject, and having always found it was of no use to talk about free wool, having always been told that the wool-growing interest would never permit it (and the wool-growing in- terest, as we all know, is very powerful), I was led to take that view of the question. 474 TARIFF COMMISSION. [m. j. cokbett. M. J. CORBETT. Long Branch, NT. J., Avgust 16, 1882. Mr. M. J. Corbett, assistant appraiser, New York custom-house, appeared before tlie Commission and made the following statement: By Commissioner Oliver : Question. Please state what division of the appraiser’s office you are connected with. — Answer. I am examiner of silks and ribbons. Q. How long have you been employed in the custom-house? — A. About twelve years. Q. Will you please indicate to us in what respect, if any, the present tariff laws affecting your department are a source of trouble or annoy- ance? — A. The greatest difficulty we have at all times is to ascertain the market value of goods that are brought into this country. I do not know how that matter could be remedied. I have made it more of a study to try and do well under the laws as they exist than to attempt to devise any new way of assessing duties. By the President: Q. Can you suggest any changes which would be desirable in the mode of classifying the duties imposed upon silk goods? — A. Most of the silks imported are received on consignment. I think perhaps if there was a specific duty imposed on them it would make the collection of the duties much more certain. I regard a specific duty, however, as a rather unjust way of arriving at that result. Still, I think it would be more certain and more uniform, and would enable us to place the same rate of duty on the same goods every time. By Commissioner McMahon : Q. Have not your duties in the silk and ribbon department been con- siderably lightened since the passage of the act of February 8, 1875? — A. Yes, sir; that has been a great relief to us, because all the manufact- tures of silk now come in under one clause. Q. Is’ not the greatest practical difficulty you have to contend with, that of determining the line at which the component material of chief value, or the component material of a certain specified class, is to be fixed? — A. We find it very difficult to do that. Q. What would you suggest as a remedy ? — A. I would suggest that the clause be made a little broader, and include more mixed materials under one rate. For instance, if the article was one where the chief value was silk, let it pay the silk duty; if its chief value was cotton, let it pay the cotton duty. When an article has as its chief value cotton, it is so evident that it is no trouble to distinguish between it and the 25 per cent, goods, which are very difficult to distinguish. Q. Inasmuch as silk is so much more valuable than cotton, whenever an article is cotton it follows as a consequence that there is but little silk in it, does it not? — A. Yes, sir. Q. Then your idea would be, as I understand, to first fix duties as far as possible on the articles that pass your division eo nomine , and then to make a class which will cover mixed materials? — A. Yes, sir; the m. J. CORBETT.] APPRAISER^ DEPARTMENT, N. Y. 475 more simple it can be made the better it will be and the more easily administered. Q. When any question arises as to the component material of chief value, how do you ascertain whether the value is up to a certain stand- ard or not? — A. We separate the component materials and ascertain as nearly as possible the proportions by weight, and estimate the raw ma- terial. Q. Do you often have to subject your goods to analysis? — A. Yes, sir. It requires the services of one man constantly, to analyze our goods, because the law fixes a line of values for component materials, and that difficulty would be obviated by a general sweeping clause. We take the materials as we find them in the article, dyed and finished, and as there has never been any specific instructions in regard to them it is rather an open question in the courts as to the course we should adopt. Q, Are not what are commercially known as silk ribbons, as matter of fact silk and cotton ribbons? — A. Yes, sir; a great many of them ; in the retail trade they would be known as silk ribbons. Among the large buyers, however, it is understood pretty well. Q. Can you suggest a sweeping clause which would take in silk fabrics, such as piece silks and ribbons, which are the principal articles of im- portation; have you any suggestion to make which would include those goods which are bought by the consumer as silk, when in fact they are not composed wholly of silk? — A. I think the “ component material of chief value” clause would do that. Q. That would open up the question of value again. What would be the effect if all silk goods should pay a duty by weight? How would that compare with an ad valorem rate? — A. That would depend, of course, upon the rate of the specific duty which would be applied. Q. Is it not a fact that a great many fabrics of silk are “loaded.” as it is called, with other materials ? — A. Yes, sir; many are weighted fully 100 per cent. By the President : Q. That is confined altogether, I suppose, to black goods? — A. Yes, sir. The 100 per cent, weighting is only on black goods. By Commissioner Garland : Q. Do you mean by that they are all loaded? — A. Yes, sir; they are all more or less loaded. By Commissioner McMahon: Q. What rate of duty per pound would cover the present ad valorem rate of 60 per cent.? — A. On the bulk of the black goods we get, about $3.50 would cover the largest proportion ; and on the colored goods about $4.50; wlfich rates would amount to about 40 and 45 per cent, on the finer goods and fancy silks. Very few silks are purchased abroad now'; they are most all in the hands of the manufacturers’ agents here, and it is very difficult for us to ascertain the market value of the goods. Some of the importers themselves have suggested that they would prefer a specific duty, so that they could know r just how they are situated in that respect, and also know what they had to do. By Commissioner Oliver : Q. Hnder an ad valorem duty the importer is fearful that his competi- tor is getting the advantage of him, is he not? — A. Yes, sir; that is what they fear. One of the largest manufacturers of Europe said that, however honest he might be, the greatest fear he had was that some of 476 TARIFF COMMISSION. [M. J. COKBETT. Ms neighbors would undervalue their goods and get ahead of him in the market. Q. Have you conversed with any importers who have expressed a desire to have specific instead of ad valorem rates of duty? — A. Yes, sir ; a great many of them have expressed that desire to me. By Commissioner Garland : Q. Are they the importers of the higher-priced goods or of goods of the cheaper class ? — A. They are the importers of general merchandise and of all classes of goods. By Commissioner Oliver : Q. Do you hear much complaint from the importers in regard to the matter of charges and commissions? — A. We have not had so much complaint recently in regard to that. Q. Can you name an average rate of percentage which could be added to the regular commission fixed by law which would cover the charges in the line of goods which you have been accustomed to examine ? — A. I think one-half of one per cent, would be a fair average rate. Q. Do you think that one-half of one per cent, would be sufficient? — A. Yes, sir ; that would cover the charges on silks fully. Q. Do you think the trade would be satisfied with a fixed rate of that kind on silk, in lieu of the allowance for charges? — A. Yes, sir; it would be much better, for the reason that as the instructions are now given, when the charges are included in the invoice we are bound to be governed by it unless we can discover a misrepresentation, and it is impossible for anybody to discover a wrongful charge of 40 or 50 francs on a large invoice of goods. Commissioner McMahon. The instructions of the department at Washington are these: That if an invoice states that the charges are included in the prices, that statement is to be accepted unless the appraiser is convinced it is false. The testimony not only of Mr. Cor- bett, but of other custom-house officers, which has been given before the Commission to-day, is to the effect that it is impossible to tell whether such statements are false or not. The Witness. That matter does not trouble us so much now, for the reason that charges are included in the invoice as a rule. By Commissioner Garland : Q. You say it does not trouble you ; do you mean by that, that you do not make any effort to find out whether the item is correct or not ? — A. No, sir; I mean that it is so small in amount that it is impossible to find it out in the different items. EDWARD SHERER.] SUGAR TESTS. 477 ED WALD SHEKEL. Long Branch, N. J., August 16, 1882. Mr. Edward Sherer, chemist in charge of the United States labora- tory at New York, upon the request of the Commission, made the follow- iug statement : I understand the Commission desire me to state my views in regard to the subject of the importation of sugar and the tests applied to ascer- tain its value for the purpose of assessing duties. I will remark, in the first place, that the Dutch standard, as applied to natural sugars, or sugars not subjected to special processes of manufacture for the purpose of giving them a dark color not corresponding to their saccharine strength, is a measure of value, or of saccharine strength, which in accu- racy is second only to the polariscopic test, and has the advantage over the latter in requiring no special expert skill in its use. I am of opinion that the present system of collecting duties upon sugar by the Dutch standard should be supplemented by a provision that will permit the Secretary of the Treasury to determine by chemical analysis or other means the true color, Dutch standard, of sugars the general character of which leads to the assumption that their saccharine strength is in excess of that of the class to which they would, when compared by their color, seem to belong. The gain to the revenue for the year 1880 over 1879 by reason of the importation of sugars of lighter color was $2,067,940, a result due to the Treasury Department order of September 2, 1879. This gain was in addition to that derived from increase of duties collected by the polariscope test, which latter has been refunded to the importers under the Supreme Court decision. The gain for the year 1881 over 1880, by reason of higher classifica- tion, was $1,857,324.10, of which there was paid on polariscope test $708,810.99, and refunded. The gain about which there is no contro- versy was $1,148,513.11. A provision of law empowering the Secretary of the Treasury to de- termine the true color, Dutch standard, of artificially colored sugars, would stop the artificial coloration of raw sugars and restore to the Dutch standard its true character as a measure of saccharine strength or value. In support of this opinion I would call attention to the fact that the number of sugars the grade of which was varied by polariscopic test, under the order of September 2, 1879, diminished greatly under the operation of that order. The system of classification by the Dutch standard possesses the ad- vantage of simplicity in its application over the polariscopic test, and with the provision- 1 have suggested to prevent its falsification no better system for the assessment of substantially ad valorem rates can be de- vised. A change in the direction of simplification might be made by taking Nos. 10, 16, and 20 as the limits of the different classes instead of Nos. 7, 10, 13, 16, and 20 as at present. On the 25th of September, 1880, the Government of Holland issued an edict subjecting sugar recognizably colored to chemical analysis, to 478 TARIF1 COMMISSION. [edward sherer. determine the class to which it should, according to the color standard, belong, retaining the color standard alone for all other sugars. In France, iu 1875, a law was passed providing that where the color of the sugars does not appear to correspond with their effective richness, re- course should be had to polariscopic test for the definite classification of sugars. If it be not considered advisable to place such power in the hands of the department by the enactment of similar laws to that of France and Holland, the simple adoption in the tariff laws of the department order of September 2, 1879, would afford ample protection to the revenue and be entirely just to the importers. The order I refer to is as follows : “All sugars, the apparent color of which as imported is not above No. 7 Dutch standard in color, and which contain over ninety -three per cent, and not over ninety-seven per cent, of crystallizable sugar, in 100 parts of the dry substance, shall be classified as above number seven and not i.bove number ten, Dutch standard. “All sugars, the apparent color of which as imported is not above No. 10 Dutch standard in color, and which contain over ninety-seven per cent, of crystallizable sugar, in one hundred parts of the dry sub- stance, shall be classified as above number ten and not above No. 13 Dutch standard.” In concluding this hurried statement of facts, I will simply refer to one or two authorities on this subject. Dr. Richard von Kaufmann, one of the most eminent European authorities on the subject of the relation of the sugar industry to the customs and internal-revenue laws, says, regarding the Dutch standard: This valuation of colonial sugar by the so-called color standard originated at a time when saccharometry lacked the optical aids to-day in our possession, and one in which sugars of tropical origin alone came under consideration. The necessity was at that time already felt to conduct the purchase of larger quantities of sugar on the basis of a certain normal sample. The Dutch agents and brokers came to a mutual understand- ing, and mixed average samples of the Indian sugars handled in the Dutch market, of which the best, marked No. 20, represented a nearly pure sugar, which was dry, sharply crystallized, and somewhat grayish white in color, while the lowest number represented an average of the darkest-brown sugars. The lowest sort of those that uow appear in commerce is marked No. 6, and represents a dark-brown, soft sugar, rich in sirup. The numbers lying between Nos. 20 and 6 are progressive transitions between these extremes. This in itself, aud under the then existing conditions, not unpractical method was at the time adopted with all the greater readiness for the reason that the need of a method of determining the value of crude sugars of different qualities, resting on the simple indications of the senses, had been equally keenly felt both by the manufact- urers aud the dealers, in the estimation of the commercial value of the article, and the revenue authorities ( fiscus ) for the correct adjustment and apportionment of tax- ation. The introduction of this method is based on the observation that sugar in a pure state is, in itself, throughout white ; on this was founded the theory (annahnie) that the degree of coloration, which could only be caused by the intermixed substances or decomposition products of sugar adhering to the sugar, was to be considered as a measure of the lower value of the sugar. At the same time, as a conversion of the crys - tals to powdered sugar caused the mass to seem less intensely colored than would otherwise be the case, it was sought to perfect the method by testing the sugar as to the sharpness of the graiu, which could be felt by rubbing it between the fingers, and finally it was sought to estimate the degree of dampness of the sugar in order to be able to approximately determine or estimate the amount of water contained therein. The color types, which by this method furnished the principal criterion of the value of the sugar, had originally in the case of colonial sugars a tolerably well justified im- portance, which, however, can no longer be ascribed to them, since technical progress has made it easy for the industry to effect the coloration of raw sugars by artificial means without materially altering the value of its yield in pure sugar (refined sugar) — i. e., ita refinery yield. It is at present not only possible to prepare raw sugars with a lighter color, which shall show a bright luster even iu the last products, without their containing any more pure sugar than the far darker-colored products of other EDWARD SHERER.] SUGAR TESTS. 479 manufactories, but sugars of high percentage are frequently colored dark in order to reduce the tax or duty to which they are liable, without causing them to suffer any reduction of rehnery yield. Dr. Moore, commenting upon this, in his statement relative to the artificial coloring of imported sugars published by the Treasury Depart- ment, says: “ It will be observed that the authority cited defines the Dutch stand- ard as a measure of value and saccharine strength only; the compari- son of the shade of color being one of the principal indications, but supplemented by other tests, having for their object primarily to ascer- tain whether any cause exists that would disturb that relation between color and saccharine strength which the employment of the shade of color as a means of comparison presupposes as an indispensable condi- tion. The theory underlying the Dutch standard is clearly enunciated, and it is that the saccharine strength of raw sugar varies inversely as the intensity of the coloration, and conversely, that the species of color of which alone the Dutch standard takes cognizance is that species of color which* varies inversely as the saccharine strength. That this is the sole sense in which the physical attribute of color is employed as an in- dication in the Dutch standard is clearly shown in the description of the mode of applying it; the precautions as to the feel of the grain, &c., being employed to ascertain if the external or visible color of the sample does, in fact, bear that relation to saccharine strength which alone would permit the application of the Dutch standard by simple visual inspection and comparison. “The Dutch standard is described, not as a series of colored sub- stances, for which a series of strips of colored card-board might with per- fect propriety and vastly greater convenience be substituted,butasaseries of sugars representing different commercial grades, varying progress- ively in saccharine richness from the lowest to the highest percentage of saccharine strength, and which are not compared with the sample to be tested by color alone without careful preliminary tests to make sure that this color bears a definite relation to saccharine strength. Hence, from the first origin of the Dutch standard, and in the country where it originated, and from whom we first learned to use it, it was the cus- tom to use in connection with it the best tests then at hand to make sure that the external color of the sample bore this necessary definite ratio to the saccharine strength. “During the investigation of the question of taxation of sugars by the French ministry of agriculture and commerce, Mr. Peligot, member of the Institute, verificator-in-chief of the assays at the mint, and one of the most eminent chemists of France, testified as follows : “That as an indication of saccharine richness of a sugar he would give the prefer- ence to the shade of color, that is to say, to the types (color standard tr.) over sacchar ometry and chemical analysis, always on the condition that the types he suitably prepared and renewed whenever necessary. It is necessary to reserve the right to have recourse to saccharometry in certain cases as a means of veriiication. In prac- tice for the government the shade of color gives results as exact as possible. “ Concerning the specimens that have been produced of low numbers (color stand- ard tr.), giving a considerable excess (in saccharine strength tr.), they have been made for the needs of the cause; they do not constitute the effect of a new and bona-fide ( loyale ) manufacture, but a means of defrauding the revenue.” “And during the same investigation the representatives of the Agri- cultural Society of France stated: “ In short, one may say that sugar is a docile substance, lending itself to the designs of the manufacturer, who can make of it a white or brown sugar as he pleases. To- day he uses this liberty, thanks to the system of types (color standard tr.), to make a 480 TARIFF COMMISSION. [EDWARD SHERER. sugar of a very high price with a shade of color that corresponds to a strength of only 88 degrees. The sugar is colored with caramel ; this operation is so publicly performed that there exists at Arras a manufactory hearing the sign * caramel for coloring sugar. ,, ■ u The foregoing ex-tracts from the leading authorities in the principal countries of Europe, as well as in the United States, show conclusively that the employment of the indication of color as a means of compari- son for classification rests exclusively on the existence of a definite relation between color and saccharine strength. The operation of classi- fication by color is universally held to be identical with that of classi- fication by saccharine strength. The only color that can be made a basis for classification is hence that species of color that bears a definite relation to saccharine strength ; it is the only species of color that can be measured by any color standard for purposes of classification.” By Commissioner Kenner: Q. What are your precise duties in the custom-house 1 ? — A. My posi- tion is that of chemist in charge of the United States laboratory. My duties have been hitherto mostly in the testing of sugars ; that is my specialty. I have also charge of all the chemical work done at the laboratory, such as chemical analyses made of samples sent by the appraiser’s office to the laboratory ; all that is done either by myself or under my direction. Q. I presume that you have, then, a practical experience in the use ot the polariscope. — A. I have for the last ten years made that a specialty. I have been in charge of the United States laboratory for the last two years. For eight or ten years before that my business was testing sugars for the brokers, importers, and traders in Kew York. Q. You have quoted at length the order of the Secretary of the Treasury of September 2, 1869. During the year or two within which that order was acknowledged as authority from the government to test sugars by the polariscope, what was the result of your testing as com- pared with the testing by the importers ; was it identically the same, or was there a broad difference between the two tests, the government arriving at one result and the importer at another? — A. There was a very slight difference. In many instances the same result exactly was obtained; and the difference, where any existed, of more than one- quarter to one-half per cent, was found to be due to the difference in samples. When comparisons were made, the same result on the same sample was obtained by chemists outside the department as was ob- tained by us. There was a remarkable uniformity in the tests made by the trade and by the government. Q. The difference that existed was caused, not by the difference in the instruments but in the difference of sampling, as I understand you. — A. Yes, sir. The instrument is one of the most exact known to chemical science ; the sugar fairly registers itself — the sugar solution. Q. The point you make, then, is that the slight difference of one-third, one-fourth, or even one-half percent., between yourself as the government agent and the importer’s test made by the polariscope, was due to the difference in sampling, and not to the difference in the instrument? — A. Yes, sir. We found that such was the case wherever there was a varia- tion and we had an opportunity of making an investigation. Q. Then in grading sugar by the eye, which is tfie Dutch standard, that same cause of difference would exist? Of course you aud the im- porter draw samples, and you ask a man to test that by the naked eye. The difference you think between the test of the government and the test of the importer would simply result from the difference in sain- EDWARD SHERER.] SUGAR TESTS. 481 pies? — A. Yes, sir. Differences of opinion frequently arise between tlie importer and the custom-house officers, in classification by the Dutch standard, in that way, by their having different samples. Q. The fact remains, then, that in the Netherlands and in France, where the Dutch standard was first adopted, and where the polariscope was invented, they no longer test by color, but prefer the polariscope. Do you think that it is pretty good evidence that in the country where the polariscope is best known it is regarded as the best test of the quality of the sugar ? — A. Yes, sir. Q. Have you read the-decision of the Supreme Court of the United States on the question of the issuance of this circular by the Treasury Department? — A. Yes, sir. Q. The objection made by the court to that was that the Secretary of the Treasury had assumed to make the law instead of following the law as it existed. It did not effect the question of the value of the polar- iscope as a means of testing the quality of sugar, in preference to the old method of testing it by the naked eye ? — A. I do not understand that the decision reflected at all on the method of testing sugar by the polariscope. Commissioner Kenner. It simply was that the executive department had construed a law different from the intention Congress had in mind when it passed the law. The Witness. Yes, sir $ I so understood it. H. Mis. 6 31 482 TARIFF COMMISSION. [GUSTAV SCHWAB. GUSTAV SCHWAB. Long Branch, N. J., August 16, 1882. Mr. Gustav Schwab of New York City, importer, made tlie following statement : I would like to call the attention of the Commission to the fact that the use of the polariscope is the very best known means of determining the qualities of sugar. It is acknowledged to be very accurate indeed. The differences which have occurred between the importer and the govern- ment in the results of the analyses by the polariscope are caused by the sampling. I happen to have a cargo of muscovado sugars on hand at the present time. When the cargo came in and was landed, our broker, as is the usual custom, had the sugar sampled. These sugars came from a plantation which usually turns out sugars of about 88°— a low grade of sugars. When the samples were drawn by our broker, they Avere immediately sent to the chemist, who analyzed them by the polar- iscope, and we received the report that 300 hogsheads of that sugar only tested 85° and a fraction over. That surprised us very much. The broker also informed us that the refiners, who also draw their own samples and abide by their own tests, only made these hogsheads test 83 per cent. That surprised us still more, and I instructed the broker to send to Brooklyn, where the sugars were, and have them resampled and retested. He did so, and the result was they produced 88 per cent. Now there was a difference of 5 per cent, between our test and the re- finers, test, and 3 per cent, between our own tests. Therefore, I say, the great difficulty in the matter arises from the sampling. It depends upon whether you draw out the samples from the top or the bottom of the hogshead. You can make almost any difference within 5 or 6 per cent., according as you draw the samples from the top or bottom of the hogs- head. That fact ought to be considered by the Commission in recommend- ing the use of the polariscope as a means of testing sugar to determine the rate of duty to be paid. I have been familiar with the subject for many years, and I think from my experience that you can make no better rate of duty on sugars than a simple ad \mlorem rate. The value of sugar is well known throughout the world. No great frauds can be committed on the revenue by the undervaluation of sugars. It is a low- priced article anyway, and if you put an ad valorem duty upon it, what- ever it may be, it will be just to all the different interests, to the refin- ers and to the importers. By Commissioner Kenner : Question. I do not know whether I fully understand your views in regard to the polariscope. Do you accept the polariscope as being as nearly complete and perfect an instrument as can be made to test the value of sugar, provided the same samples can be used in both instances by the government and by the importer? — Answer. Yes, sir. Q. But you say, that in the case you cited, there was a difference of 5° in the different tests made from the same sugars. — A. Yes, sir. Q. Are you not aware that if you draw a sample from the bottom SUGAR. GUSTAV SCHWAB.] 483 of the hogshead and one from the top, that the difference in color as seen by the naked eye will be more than 5° ? A. — Not always. Q. But as a rule? — A. O, yes, of course the color is darker where the sugar is taken from the bottom of the hogslie.ul than if it is taken from the top. Q. Then what we ought to do, would be to provide a proper system of sampling, provided we do not adopt your principle ot the ad valorem duty. But I am not discussing that subject now ; I am only ascertain- ing your views as to the polariscope. If we are able to make proper laws in regard to sampling sugars, you think the polariscope would be as good a test as the naked eye ? — A. Yes sir, as good a test, and a more proper test, because it gives the real value of the sugar more ac- curately. Q. When you buy sugars yourself in your own business, what means do you employ to ascertain the quality 0 ? — A. I never buy anything ex- cept refined sugars. But I sell sugars. Q. I mean when you buy or sell sugars. What does the trade gener- ally use in testing the value of sugars ? — A. The first thing is to have the samples drawn and tested by the polariscope, by some recognized chemist connected with these broker’s offices, who does nothing else but examine sugars. A. Do you know of any low grade sugars passed in New York at all which are not bought or sold by the polariscope test ? — A. I do not believe there are many at this time. Q. Of course the honesty of the sampler is a great protection between the buyer and the seller. If a party goes into the market in New York and trusts to his eye alone in buying sugars, would he not make a sad mistake, and one that you never have made? — A. The refiners have acquired great dexterity in judging of sugars by the touch or the eye. An experienced refiner will come very near the true proportion of sac- charine matter in the sugar by looking at it, or by touch ; the touch is a very important point. Q. The law does not provide for the touch; it only provides for the color. — A. I know it does not, but all the large refiners makes the po- lariscope test of every particle of sugar they buy. They are always in the habit of drawing the samples poorer than our brokers do because it is their interest in crying the sugars down. But that comes out all right in the long run ; and when there is a way of sampling sugars accu- rately, that does not enable them to buy the sugars cheaper. But it is of course to their interest to decry the quality of the sugar. Q. Do you not think that an instrument in use (as you admit the polariscope is), as a tester of sugars between the buyer and the seller all over the civilized world, is an instrument that could be well adopted by the government? — A. Yes, sir, as an instrument, certainly; I think it is a safe instrument to adopt. By Commissioner Oliver: Q. You say you would recommend the imposing of ad valorem in- stead of specific duties? — A. Yes, sir. Q. Will you please give your reason for that? — A. Because they will operate evenly on all classes of sugar. If you put a specific duty of, say. two cents a pound on refined sugars, all the East India sugars will pay one-fourth to one half a cent more duty than the centrifugal sugars from Cuba, because they contain so many more impurities; that is self- evident, I believe. If you make the duty simply a specific duty, what- ever rate it may be, you would discriminate against the low grades of 484 TARIFF COMMISSION. [GUSTAV SCHWAB. sugar and in favor of tlie high grades of sugar. If it is only a differ- ence of one cent in the duty, of course nobody would complain. But the effect would be that you put so much more money into the pockets of the Cuban planters who raise centrifugal sugars, and you make East India sugars comparatively cheaper because they cannot get as much for their sugars as the Cuban planter who pays less duty. Q. Have you considered the liability of undervaluation? — A. Of course there are some little chances of undervaluation, but you must not forget, gentlemen, that at the present time the value of all raw ma- terials is very well known all over the world. We get importations from Manila and other East India countries every day, which have been bought on telegraphic orders, naming the rate, so many pounds sterling per ton free on board. * By Commissioner Kenner: Q. Do they not usually add u polarizing such and such a degree” ? — A. Ko$ they do not guarantee the polarizing; but superior sugar will polarize from 85 to 87 ; extra superior will polarize from 90 to 92. In those foreign countries we cannot buy by the polariscope ; we buy by the classification which is established in every place. In Manila, for instance, there is a certain standard of a cargo; it is always bought in large car- goes. There is a certain standard, which is obliged to be two-thirds of what we call superior sugars, and one-third of ordinary sugars; that is the standard cargo by which they are sold. If the cargo turns out better, it is something extra; if it turns out lower, the sellers have to make an allowance. Q. I suppose you frequently see the Havana price current? — A. Every day at eleven o’clock you have in the sugar exchange the quota- tions. Q. Do you not see occasionally the Havana price current? — A. Yes, sir. Q. Is it not always stated in that price current that the price of sugar, polarizing such a degree, is such a price? — A. I think that is the case in Cuba on centrifugal sugars, but not on muscovado sugars. .This whole matter is governed by the commercial rules which apply at the place from which the sugar comes. By Commissioner McMahon : Q. I understand you to say, if a duty of 2 cents a pound should be put on sugars, it would discriminate against certain kinds of sugars. Suppose the same rate of duty was put upon every pound of crystalliz- able sugar, as determined by the polariscope; would that attain the same object that you aim at in suggesting an ad valorem rate of duty ? — A. It would ; that would be an ad valorem duty essentially. GEORGE W. WEIKEL.] SPICES. 485 * GEORGE W. WEIKEL. Long Branch, K. J., August 16, 1882. Mr. George W. Weikel, of Philadelphia, president of the Weikel and Smith Spice Company, made the following statement: Gentlemen of the Tariff Commission: I have not come here with any set speech or any prepared argument to lay before you, but simply in response to the invitation which was given to me. We have no favors to ask, nor are we dissatisfied with the present condition of things. We have no complaints to make. So far as we are concerned, in the matter of spices and the duties laid upon them, we shall be perfectly satisfied if no changes are made in the present tariff. We would, how- ever, state that if it is considered a wise policy to put spices or any portion of them upon the free list, you should have regard to the dis- tinction that is made between crude spices and ground spices. At present there is a difference probably of 50 per cent. Peppers, for in- stance, pay a duty of 5 cents a pound; prepared or ground pepper of different grades pays a duty of 10 cents a pound. Ginger is on the free list; ground ginger pays a duty of 3 cents a pound. Mustard, which is not strictly speaking a spice, but comes under that head, has different rates of duty upon it ; mustard seed is admitted free, while prepared mustard, which requires considerable labor to put it into mar- ketable shape, pays a duty of 10 cents a pound in bulk and 14 cents a pound put up in tins. I do not know that it is necessary to go over all the articles ; there are but very few, only about a half a dozen, upon which any change would affect our business. We would be perfectly satisfied to have the duties on spices remain as they are, because we think they are not burdensome. The consumer certainly does not feel the burden. There has been no change in the duty on spices for ten years probably, although I am not quite sure of the exact length of time. The collection of the duties and the prices fixed in the market for these things seem to be so well understood that any change might cause a demoralizing effect. I do not know that I have any other sug- gestions to offer. As far as the manufacturers are concerned, I do not know that they are feeling the burden any. The price of pepper to-day is 17 cents a pound and the duty upon it is 5 cents a pound. By the President: Question. The question is whether the consumers would receive a benefit if there was a reduction of duty, or if spices were placed on the free list; would that benefit the consumers or not Answer. I do not believe the consumers would feel it. There are as many pounds of pepper used by consumers in this country as of all the other spices together, and, therefore, pepper may be taken as a sample of the rest. I suppose we manufacture 100 pounds of pepper to every 75 pounds of all the other spices. By Commissioner Garland : Q. What do you mean when you say you manufacture it? — A. 1 mean that we grind it up and put it into portable shape in papers 486 TARIFF COMMISSION. [GEOBGE W. WEIKEL, And tins and glasses for family use. A quarter of a pound of pepper is usually sold at retail for 10 cents. Competition sometimes brings the price down to 8 cents. I suppose a half pound of pepper is as much as the average consumer uses in a year, and for that reason we say that none of the consumers would feel the effect if pepper was put upon the free list or the duty upon it reduced. By Commissioner Kenner : Q. Is the operation of grinding pepper a costly one? — A. No, sir ; it is not costly, but in the case of some other spices the grinding is costly. Q. What kind of a mill do you use to grind spices in ? — A. We use the ordinary burr mill ; the same that is used in grinding corn and flour. It costs from 75 cents to $1 a hundred for grinding, and then there is the packing, and a certain percentage should be added for loss. By Commissioner Garland : Q. What is the percentage of tare allowed? — A. We generally cal- culate about 3 per cent, for tare ; sometimes not so much, depending upon the condition the pepper is in. Other spices cost more for grind- ing ; they cost from 2 to 4 or 5 cents a pound. Take, for instance, cay- enne pepper ; that is a very hard thing to grind, and the process very unpleasant, and then there is not so much demand for it. When we can run a mill and grind from 5,000 to 10,000 pounds of spices without stopping we can, of course, make the cost per hundred pounds much less for grinding than if we only ground 400 or 500 pounds at a time. Q. Do you believe there is a housewife anywhere throughout the Western country who does not grind her own cayenne pepper? — A. Ko, sir ; there is a kind of cayenne pepper, called Jersey pepper, raised in this State, but they find difficulty in grinding it or having it ground. Years ago the millers used to grind it for them, but they have stopped doing that, and it is sometimes sent to us to grind. We ground some last week for a party who lives in Trenton. Q. I suppose the investment required for the process of grinding is simple; these burr mills do not cost a great deal? — A. That depends upon the amount of business a person does. You cannot start a mill by hand; it is necessary to have steam machinery, and one mill will hardly pay a man to run it. We run three or four mills grinding spices. Q. What proportion of the spices brought into this country are man- ufactured? — A. There is considerable ground mustard brought in, but not many ground spices. We seldom come in competition with them. By Commissioner Oliver: Q. If spices were put upon the free list do you think that they would be brought into this country in a manufactured form? — A. I think if the crude and prepared goods were all put on the free list there would be a tendency to bring in manufactured goods. Q. Would the manufacturers, as a rule, like to have the rude goods put upon the free list, and the duty kept on the manufactured arti- cle? — A. I have not heard any expression from any of them upon that subject. I do not know that it would make any difference to us whether they are put on the free list or not. Q. I understood you to say that you preferred that the present rates of duty should be kept on spices. — A. Yes, sir; we prefer that no change should be made. Q. Do you not fear that if a change is made, and any of these items are placed on the free list, the manufactured article will be brought in from abroad? — A. Yes, sir; we think that it would. GEORGE W. WEIKEL.j SPICES. 487 By Commissioner Garland : Q. In your opinion, wliat would be the effect upon the quality of the goods if the foreign manufactured spices were brought in? — A. Ido not think it would have any effect upon the quality. Q. You think that foreigners are no more apt to adulterate spices than parties engaged in the business in this country are? — A, I do not think they would be ; I suppose they are about the same as we are in that respect. By Commissioner Oliver : Q. A suggestion has been made that some of the articles used for adulteration, now on the free list, should have a duty put upon them, as, for instance, almond shells. — A. We do not have occasion to use a single article for adulteration or for mixing that is not raised in this country. Q. Almond shells are not raised in this country. — A. No, sir, and we have never had occasion to use them. We never have used more than a thousand pounds altogether, and that was simply as an experi- ment. We do not have occasion to use anything of that kind which would be imported. Everything we use is the same as on the free list already, because it is not imported. Q. Would there be any difficulty in regard to the importation of ground spices from the fact that they would get stale and unsuitable for use? — A. No, sir; I think not. Of course spices deteriorate, but not rapidly. They will lose their strength in time unless put in air- tight glasses. I do not think they could be brought to this country in this shape unless put up in glasses or tins. 488 TARIFF COMMISSION. [WILLIAM T. RYERSOX. WILLIAM T. BYEBSOH. Long- Branch, H. J., August 17, 1882. Mr. William T. Byerson, of the firm of Byerson & Brown, of Hew York, made the following statement : The present duty on hay is 10 per cent. We claim, as it is a raw ma- terial, that it should be duty free. It is a very bulky article, and of course the further it is transported the greater the expense. It is an article we never call on foreign countries for, unless we have a season of scarcity. In ordinary seasons we raise all that we need in this country. Two years ago we had a short crop, and we had to call on Canada quite largely for hay, and we found the duty of 10 per cent, added very materially to our tax, while it did not benefit the farmers throughout the country, generally, because they depend mostly upon their local trade. Hew York City supplies not only this local trade, but it supplies the South and other sections with hay. I do not think any interest would suffer by removing this present duty of 10 per cent, on hay ; and, if we should be cursed by a bad season again, the community would derive a benefit from the repeal of the present rate. By the President : Question. How would the removal of the duty affect the American growers of hay on our frontier adjoining Canada ? — Answer. They only raise hay for their own use; and in regard to their location on the frontier, the freight would be so heavy from there to He w York (amounting to at least $4 a ton) that I don’t think it would interfere with them at all. By Commissioner Boteler : Q. Are you a farmer ? — A. Ho, sir ; I am consumer only, and I appear here only as a consumer. Q. Your place of business is in Hew York City ? — A. Yes, sir. - By Commissioner Garland : Q. Are you a dealer in hay*? — A. Ho, sir; only a consumer. By Commissioner Porter : Q. What effect would the repeal of this duty have upon other localities besides Hew York 1 ? — A. I do not think it would have any detrimental effect. Take Long Branch, for instance. We are consumers at Long Branch as well as in Hew York. The price of hay at Long Branch does not depend upon the price in Hew York. We are paying $1.20 a hun- dred here, while in Hew York it is only 90 cents a hundred. Q. What effect would it have upon the Western farmers? — A. I do not think it would have any effect. There they raise hay only for their own use. Q. When you speak of the effects on the border, do you mean on the Canadian side or on this side ? — A. I mean on both sides. The only benefit they can derive from shipping hay is when they are near a shipping-point. By Commissioner Garland : Q. What States do you refer to when you speak of the farmers raising hay for their own use only ? — A. I refer to the United States generally. WILLIAM T. RYEltSON.] HAY. 489 I am told that the South looks to New York and Maine for its supply of hay. Q. Do you speak advisedly on that subject? — A. I am so told by people in the trade. Commissioner Underwood. The people in the South do not buy their hay from New York ; they buy it from Ohio, Indiana, Kentucky, and Illinois. Commissioner Garland. It is within my knowledge that thousands of tons of hay are shipped from Illinois to the East and South. The Witness. I was informed this morning by a gentleman in the trade, that the great bulk of the hay shipped to the South comes from New York and Maine ; he is in the room now. Commissioner Underwood. In the small city in which 1 live I never have heard of the use of a bale of hay that came from New York. Our hay comes from Tennessee, Kentucky, Ohio, Indiana, and Illinois. Commissioner Garland. [To the witness.] I think the gentleman who told you that, could only have been partially informed. The Witness. I can only speak from tny knowledge of the trade at New York, and from what I learned from the gentleman who gave me this information this morning. He is in the room, and can be called upon if you desire. Q. You do not vouch for the reliability of his statement ? — A. No, sir; I only appear as a consumer, and am not able to state what the facts in the case are in that respect. By Commissioner Underwood : Q. Do you know how much revenue is derived from the duty on hay ? — A. Ordinarily it amounts to a very trifling sum. Some two years ago we had a very short crop of hay, and then, so I was informed, we imported some 500,000 tons from Canada. But that was an excep- tional year. By Commissioner Garland : Q. What was the average price of that hay ? — A. About $10 a ton in Canada. Q. And it paid a duty of 10 per cent. ? — A. Yes, sir. By Commissioner Boteler : Q. If the duty amounts to little or nothing, why take it off to favor one locality, when all the great agricultural districts are concerned in hay, and the price of it in our markets?' — A. I do not think the agri- cultural districts are interested in the question of the duty ; I think it is only the large centers of trade that are affected by that. Each sec- tion, as a general thing, raises only hay enough to supply its own wants. Commissioner Boteler. I can only speak of my own section — the valley of Virginia. We bale hay and send it off to market, and it is a very important interest with us. Perhaps some of it gets to New York ; I do not know about that. We have indigenous grasses that are very luxuriant in West Virginia; but in the Valley of Virginia a great deal of hay is sent away in bales. It is baled in presses to a very consider- able extent. The Witness. We receive all our hay in that way. Mr. J. A. Frazee, of New York City, dealer in hay, said : Our business is selling hay on commission. We do not have hay enough in this country to supply the wants of the consumers, and we desire to increase its production in every way. 490 TARIFF COMMISSION. [WILLIAM T. RYEKSON. By Commissioner Porter : Q. Where does the most of the hay which you get, come from ? — A. New York furnishes more hay, 1 think, for this market than any other State, and I suppose the State of Maine would come second, and Penn- sylvania third in order. By Commissioner Boteler : Q. You get supplies from Pennsylvania as well as from New York ? — A. Yes, sir; I suppose the hay crop in Pennsylvania pays them more than any other one crop which they raise. By Commissioner Garland : Do you desire the removal of the duty on hay ? — A. No, sir ; we do not; we are middlemen and do not make any recommendation on that point. Q. You are not asking for the abolition of the duty on hay, then? — A. No, sir ; we are not. A. L. SMITH.] appraiser's department, n. y. 491 A. L. SMITH. Long Branch, N. J., August 17, 1882. Mr. A. L. Smith, examiner in the United States appraiser’s Depart- ment, New York, made the following statement: I desire to state to the Commission the difficulty which has arisen quite recently in regard to ascertaining the foreign-market value of Mediterranean fruits. Mr. Sturges has already stated that, owing to the establishment of steamship lines to the Mediterranean ports, the fruit trade has been entirely revolutionized. Oranges and lemons of every possible grade, from the veriest refuse to those of the highest quality, are now brought in immense quantities, and are for the most part consigned by the foreign packers to their agents here, and invoiced at nominal prices. Frequent advances are made upon these goods by the appraiser, but in cases of reappraisement, which are frequent, it is often impossible to prove the foreign -market value, from the fact that there is no knowledge of any cash sales, of corresponding dates, to be obtained from the witnesses called upon to testifyj although these em- brace the entire trade. This is especially true in the case of fruits from Palermo, which are almost universally shipped here on consignment. These goods, also, being of a perishable nature, are necessarily permitted, landed, sold, and dispersed immediately upon their arrival, so that in case of reappraisement they cannot be produced in evidence. Under these circumstances I think it has become an absolute necessity to im- pose a specific duty upon these goods in lieu of the present ad valorem one. This duty should be graduated according to the size of the pack- ages j for example, so much upon boxes not exceeding a certain meas- urement, and a proportionate increase for cases and unusually large boxes. The statistics necessary to formulate this can be obtained at the New York custom-house. Commissioner McMahon. I would suggest to the witness' that he prepare a paper giving details and hand it to the Commission. By Commissioner Oliver : Question. Would it not be better, instead of specifying the size of the boxes, to specify the fruit by the dozen or hundred ? — Answer. I think not. Boxes of the same size contain such different numbers of fruits that all would have to be counted or otherwise estimated. Q. Will not the importers increase the size of the boxes, as in the case of fire crackers ? — A. The size of the box could be definitely specified so that any increase in the present standard sizes would involve a pro- portionate additional duty. Q. Could not the average weight of the box be ascertained and the duty be assessed by weight ? — A. It could, but I think the cubic con- tents of the packages would afford a more convenient and equitable basis for the assessment of duty. Q. Would you not generally prefer a specific to an ad valorem duty ; is it not a better method of collecting the revenue, and would it not bet- ter satisfy the importers ? — A: In cases where a specific duty would operate equitably it is to be preferred. In the case of these fruits, I have no doubt that both the interests of the department and of the im- 492 TARIFF COMMISSION. [A. L. SMITH. porters would be promoted by its adoption, and that the importers would be better satisfied. A suggestion has been made that the duty upon these goods should be assessed upon the home value , but, as they are nearly all sold at auction immediately upon their arrival, this would necessitate liquidation, at the custom-house, upon the auctioneer’s ac- count of sales instead of upon the invoices. For similar reasons I would recommend a specific duty upon West Indies fruits. I would also rec- ommend a specific duty upon soaps, in lieu of the present mixed duty. This would cause the badly adulterated soaps to pay a higher rate than at present. At DAVID C. STURGES. ] APPRAISER^ DEPARTMENT, N. Y. 493 DAVID 0. STURGES. Long Branch, N. J., August 17, 1882. Mr. David 0. Sturges, assistant appraiser in the appraiser’s depart- ment, port of New York, in response to an invitation from the Commis- sion, made the following statement: My division (the tenth), in the appraiser’s department, includes gro- ceries, provisions, wines, cigars, statuary, and furniture. There are, perhaps, in my division, fewer incongruities than in some other divisions. I have not many suggestions to make, except in the direction of a simpli- fication of the tariff and the advocacy of uniform rates of duty upon articles of the same class. The first articles upon my miscellaneous and immethodical notes to which I would call attention are pease, beans, and buckwheat. Pease and beans belong, generically, to the order of seeds, and should be classified under some one of the provisions for seeds; but they are, by a decision of the department, subject to two rates of duty. (1) When they are intended to be consumed as food they are admitted as “vegetables not otherwise provided for” (10 per cent.), and (2) when imported for use as seeds they are charged with the duty im- posed upon agricultural or garden seeds (20 per cent.). Buckwheat be- longs as much to the class of seeds as pease and beans, and is quite as much of a vegetable as either, yet, under the decision of the department, it is not classified as a’ “vegetable not otherwise provided for (10 per cent.),” nor as seed, but as a “ non-enumerated unmanufactured article,” at 10 per cent. duty. I would suggest that one rate of duty be placed upon all seeds, except medicinal seeds. The provisions for “seeds for agricultural purposes ,” &c., as the phraseology of the law is, has led to the decisions of the department which I have just referred to. It seems to me that seeds, excepting strictly medicinal seeds, irrespective of the “purposes” for which they are imported, should be classified at one rate of duty. The next article to which I desire to call attention is olive oil, referred to in paragraph 1344 to 1346 inclusive, “ Heyl’s United States Import Duties.” Olive oil, under the present law, pays a specific duty when “not salad,” of 25 cents a gallon, and when “salad,” $1 per gallon. The practical difficulty we have had in administering that law is just here: that the line between oil “not salad” and “oil salad” is purely imag- inary, and the constant tendency on the part of the importer is to get in the best oil he can at 25 cents, as oil “not salad.” If we were to take the dictum of Judge Blatchford, in a case tried before him, for a guide in the matter of classification of oil, we should have to call in the judge himself to determine the question. He said that oil that might be con- sidered and used as “salad oil” by a poor Italian or Spaniard would not be used by a connoisseur. I suggest, therefore, a uniform rate of duty upon olive oil, either specific or ad valorem, and preferably an ad valo- rem rate. By Commissioner Garland : Question. Would you prefer a specific or ad valorem rate of duty? — Answer. I am in favor of the ad valorem rate of duty, whenever practi- cable, because of its abstract justice. 494 TARIFF C0MM1ISS0N. [DAVID C. STURGES. Q. Are you in favor of it in all cases ? — A. Yes, sir; or with very few exceptions. Q. Do you have any difficulty in arriving at the true value of olive oil?— A. No, sir; I would suggest that a low rate of duty be imposed upon olive oil. I think that what we consume in this country and produce here as “ salad oil,” is relatively poor stuff*. It maintains about the same relation to good olive oil as oleomargarine does to good butter, and I would give it about the same relative consideration. I think about nine-tenths of all the u salad oil” consumed in this country is cotton-seed oil. By Commissioner Kenner : Q. What objection is there to the use of cotton-seed oil? — A. My objection is one of taste, more than anything else. I do not think it makes a fine salad dressing or satisfies the taste as well as the other. Nor do 1 think it so wholesome or so easily digested as olive oil. Q. Did you ever taste the cotton-seed oil? — A. Yes, sir; I have. In Providence, R. I., there is a large establishment mating u salad oil” of pure cotton seed oil. It is not a bad-tasting oil by any means, and perhaps the more obvious differences in the physical properties of the oils are discoverable when you come to make them up into the form of salad dressing. I should think there could be no doubt at all that olive oil is much better for that purpose. Q. Are you able to tell how much pure olive oil is received into the United States? — A. I could hardly approximate that. Perhaps Mr. Examiner Smith could tell you. By the President : Q. Do you call pure olive oil u salad oil”?-*-A. Yes, sir; unless it becomes decomposed and rancid, and then it does not rate as u salad oil,” dutiable at $1 a gallon, but simply as oil ‘‘not salad,” dutiable at 25 cents a gallon. The department has held that the very offensive olive oil extracted from the refuse of the olive, by the process known as the sulphide of carbon process, is entitled to free entry as a u soap stock.” Thus we have, in fact, three classifications of olive oil. By Commissioner Kenner: Q. I desire to know how much olive oil is introduced into this country; but as you cannot answer that question, I will ask you another: Are you aware that all the cotton seed oil of America, except what is manu- factured into salad oil at Providence, R. I., goes to the Mediterranean ports; that is, nine-tenths of it? — A. 1 have heard that there is a large exportation of cotton seed oil to the Mediterranean ports, and that it comes back to us from Marseilles, and other places, mixed with olive or sesame oils. Q. And you think olive oil ought to be assessed at a small rate of duty ?— A. I think it should be assessed at a rate lower than the present rate. Commissioner Kenner. Nine-tenths of all the cotton seed oil made in the United States is sent to Marseilles, Trieste, and other Mediter- ranean ports, and made into olive oil, and there reshipped to the United States. I want to know, if we allow that to be done, why they should not pay a d uty ? The Witness. There might be some difficulty, perhaps, in detecting the adulteration, and we therefore must assume that it is olive oil when imported in forms indicating that it is to be used as salad oil. Commissioner Kenner. My own opinion is that there is no aduitera- DAVID C. STUKGES. 1 appraiser’s department, n. y. 495 tion. I do not think you can detect the cotton seed oil, because it has all the characteristics of the olive oil. It is easily assimilated and com- pounded, and, when compounded, it is returned here, and any one who did not know about it would take the compound or mixture as pure olive oil, and use it as such. Therefore I do not see why it should not pay a duty. The Witness. I am decidedly in favor of the imposition of a duty upon it, and of a duty equal to that imposed upon olive oil. But what- ever rate of duty is imposed, it should be a uniform duty on all kinds of olive oil, or of oils clearly similar thereto. We want to avoid the difficulty of drawing the line between oil that is “ salad oil” and oil that is “not salad.” I simply recommend that one rate of duty be imposed, leaving it to the discretion of the Commission to determine what that rate shall be. It is clear that it must be an ad valorem rate. Commissioner McMahon. As a matter of fact, oils have been passed for years as olive oil at 25 cents a gallon, which have been afterwards used for salad purposes. The Witness. I haven’t a doubt of that. The poorer classes of Ital- ians prefer the second or third pressing to the first. There is a pun- gency and bitter flavor obtained in those grades of the oil to which they are accustomed, and which commends them to the Italians, and they prefer them to the finer oils. By Commissioner Kenner : Q. Your point is, that the use of the word “salad,” inasmuch as it is descriptive, not of the article itself, but rather of the use to which the article is to be put, makes too indefinite a line; you cannot fix it? — A. Yes, sir; I would recommend that the law should read simply “olive oil.” As a matter of practice, all table oils, though mixed, are invari- ably classified as olive oil, “salad,” because they are put up manifestly for that use and for no other. By the President : Q. Is not olive oil used in the manufacture of wool, and in the arts ? — A. Yes, sir. The finest salad oils only can be used for that purpose. That is an additional reason, perhaps, why the duty on olive oil should be reduced. The next thing I desire to call attention to is statuary. There is a great deal of confusion in the law, and a great deal of confusion in the decisions of the department respecting the meaning of that word, and what is intended to be covered by it. I would suggest, simply as a remedy for the whole trouble, that the definition of the word “ statuary” (Heyl, 1349) be stricken from the law, and that the word “ statuary” be left there without qualification. We have had a great deal of trouble about the words “ professional productions ” in that definition. The words were used, apparently, to distinguish professional productions from non-professional productions, or original works from copies, per- haps ; but I never could quite understand what a non-professional pro- duction of an artist is. Commissioner Boteler. It probably means the production of an amateur. The Witness, No, sir. Copies are often productions from the same hand that produces original work. My recommendation is that the defi- nition in the law be stricken out. By Commissioner McMahon: Q. You suggest “ paintings or statuary not otherwise provided for” at 496 TARIFF COMMISSION. [DAVID C. STURGES whatever rate may be decided upon ? — A. Yes, sir; but I should favor the free importation of all works of art. By Commissioner Kenner : Q. Would you include, in the term statuary, that which we see on every tombstone in America, or in every church fa9ade, on every altar, and in almost all of our public buildings'? — A. Statues of whatever kind, when imported for certain purposes and under certain specified conditions, are already entitled to free entry. Q. Do they come in free under the section you have just referred to ? Commissioner McMahon. No; they come in under paragraph 1726, when “ specially imported” for such institutions. Commissioner Oliver. These articles would not be specially imported for grave-yards ? The Witness. Yes, when in the form of or for use as monuments. Grave-yard statuary is statuary, though often of the lower order. Commissioner Kenner. There are thousands of these objects made at home by our own people. The question is whether we will ignore them. The Witness. We haven’t the kind of marble in this country out of which statues for out-of-door use can be wrought. Statuary marble is imported from abroad. The kind of American marble fit for sculpture does not seem to be able to resist the effects of the elements — the frost, rain, heat, and cold. By Commissioner Oliver : Q. Your suggestion, if adopted, would allow all kinds of statuary, including church statuary and ornamental statuary for public buildings, for tombstones and monuments, to be brought in free ? — A. I simply say it should all come in as statuary, at a uniform rate of duty ; but I shoidd favor, as I have said, the free introduction of all works of art. The next item I desire to call your attention to is “ Bologna” sausages. As the law now stands “ Bologna” sausages are admitted free of duty. I would recommend the striking out of the word ‘‘Bologna” and leaving in the word “sausages.” A “Bologna” sausage is, strictly spejaking, a sausage of a particular character, and made originally at Bologna; but it has been imitated and made elsewhere, especially in France. The design of that law was undoubtedly to give our German fellow-citizens free sausages; but, as the law stands at present, it only embarrasses us with an unnecessary definition. Prior to the passage of the law making “Bologna” sausages free, all the German, Italian, and French sausages came in under their proper names, but as soon as the law was passed making “Bologna” sausages free, then all sausages brought in from abroad, from all quarters, were immediately invoiced as “Bologna” sausages. The next item on my notes is “cocoa.” “Prepared cocoa” is charged in the law with a duty of 2 cents a pound, and chocolate with a duty of 5 cents a pound. There is no substantial or definable distinction be- tween the two, and I recommend a uniform rate of duty for these two articles. Q. Are they produced in this country at all, or can they be'? — A. The cocoa bean, from which chocolate and cocoa are produced, is imported. The cocoa manufacturer describes his commodity as chocolate or cocoa, according to his fancy. There is, as I have said, no substantive dis- tinction between the two. I have next to speak of boxes made of American shooks, in which DAVID c. sturges. ] APPRAISERS DEPARTMENT, N. Y. 497 fruits are imported — from the Mediterranean chiefly. The law, as it at present stands, would seem to offer encouragement to fraud. It has been discovered that boxes which are claimed to be made from American shooks have only their tops, bottoms, or sides made of such shooks, while their ends have been made from foreign boards, or vice versa , and it is simply impracticable, where there are several thousands of these boxes arriving almost every day, for any corps of examiners that the appraiser’s department can command, to examine in detail all these boxes to determine whether they are made entirely from American shooks or not. • To admit to free duty boxes made abroad from American shooks would seem to be a violation of the principle which has governed Con- gress heretofore in admitting free of duty “American products” returned to this country. Hitherto, American products returned were entitled to free entry only when returned “in the same condition as when ex- ported.” The American shook comes back to us in the form of boxes, with foreign nails, and made by foreign labor. I would make a dis- tinction between boxes made in America, exported and returned, filled or empty, and boxes made of shooks simply of American production. Q. Would not that whole matter come in under what is called the charges'? — A. No, sir; because in the matter of fruits the immemorial custom has been to make no charges; fruits are always sold by the box or case at a price which includes all charges, even the shipping charges. But when it is claimed that the goods are imported in boxes made of American shooks or in American boxes, then an appraisement is made of the boxes, and the value of the box is deducted from the value of the fruit in making entry. I do not know but what my suggestion might result in checking the exportation of American shooks for that purpose, because I doubt if boxes could be made up and taken out in that form profitably ; it is only when they are in shooks and bundles that they can be exported with profit. That is a matter for the consideration of the Commission. By Commissioner McMahon : Q. You simply say that the present law is impracticable and cannot be executed'? — A. Yes, sir; it cannot be executed with any certainty. The next item to which I desire to call the attention of the Commis- sion is starch. My only suggestion upon that is, that one rate of duty shall be levied upon all starch. It is impossible to distinguish between potato starch and other starches without a microscopic examination, wliich is impracticable. Besides, different kinds of starch may be mixed and mingled together, and it would be impossible to separate them. The advisability of having one rate of duty for starch will, I I think, commend itself at once to the Commission. By the President : Q. Can you tell me the object of having a higher rate of duty on starch which is made of rice 1 ? — A. No, sir; I see no reason for it. By Commissioner Kenner : Q. Is it not a better article? — A. No, sir. I think it would be very difficult to say that one kind of starch is “ better” than another. None of our American starch is made from rice, that I know of. Kings- ford, the largest manufacturer in this country, makes his starch from the cereals chiefly, I think, but starch is also made largely from pota- toes. There is really nothing but a distinction of form between the starches. Q. What is the difference in the market price of the two varieties? — H. Mis. 0 32 4.98 TARIFF COMMISSION. [DAVID C. STUHGES- A. Bice starch is not imported mice in five or ten years, and then only as a private importation. It costs about the same as other starches. By Commissioner Oliver : Q. Is there any large quantity of starch of any variety imported? — A. There is a very considerable quantity of potato starch imported, in one form or another. It is sometimes attempted to be brought in under the name of farina. Some one had the ingenuity to go to Congress some years ago and get a provision inserted in the law for “root flour, ,r whatever that may mean. The first result of that was that arrowroot (provided for eo nomine at 30 per cent.) was admitted free. But that was soon corrected. I would also suggest that where a provision in the law fixes the rate per gallon or per bushel, there should be a defini- tion of the gallon or bushel, and so of the barrel, box, case, &c. Commissioner McMahon. Articles which come in in tin cans cannot be gauged, and so they have to be weighed. The Witness. Yes, sir. Paragraph 985, Heyl, contains two provis- ions for spirits under proof; one provision being that it shall pay not less than spirits of proof; and the other provision being that it shall pay not less than 50 percentum ad valorem. The first in the order of these pro- visions is the latest, in point of fact, in the order of legislation, and I have no doubt that the one was intended to repeal the other. It would be desirable to have but one provision, and I recommend, therefore, that all spirituous liquors under proof be made dutiable as proof at $2 per gallon, if that shall be the rate of duty decided upon. The provision imposing the ad valorem duty of 50 percentum operates only when brandy is “under proof,” and the result is that a very fine old brandy, almost always “ under proof,” is brought to proof in order to avoid the ad valorem duty, and thus all fine old brandy is received. Farina, in paragraph 1585, Heyl, is in the free list, but flour of every kind is re- quired to pay 20 per cent. duty. Either you should make farina pay 20 per cent, duty or admit flour free. Why should curry and “curry pow- ders” be admitted free, and spices be variously provided for at different rates of duty? Why should not all spices pay a uniform rate? There are now almost as many rates as there are spices. They come in com- petition with no domestic industry except, perhaps, in the production of mustard. We cannot grow pepper here, cinnamon, nor all spice, which are imported under these provisions. Q. Could not all unmanufactured or unground spices be admitted free, and all manufactured spices be put at one rate of duty ? — A. That would be a very fair provision. Q. Would you suggest the phrasing of the law, manufactured or ground spices, or what? — A. Ground spices, I think, would cover it. Sauces made of spices are already provided for; and mustard alone, when mixed in pots, is classified as a “ sauce” at 35 per cent. These distinctions in rates of duty might be done away with without any detriment to our industries. Iu paragraph 1597 (HeyPs U. S. Import Duties), you will find a pro- visiou for “fruit-plants, tropical and semi-tropical.” I would suggest the making of a uniform duty on all plants, or let all plants come in free. By Commissioner McMahon: Q. Do you mean all plants, or simply all fruit-plants? — A. I do not know why all plants and all fruit-plants should not be admitted at the same rate, or all be made free. DAVID C. STUBGEb. 1 appraiser’s department, n. y. 499 By the President : Q. Would that not affect our nurserymen? — A. Not any more than it would affect the florist. Q. But it would affect both of them, would it not? — A. Yes, sir; but beneficially, I think, in the long run. Commissioner Kenner. The introduction of plants is generally made for the purpose of enlarging the character and species of the plants. No one can grow plants in Europe and compete with our domestic growers. The President. Rhododendrons and azalias are imported in large quantities from Europe. They are grown in the gardens and nurseries of Europe, and compete with our own productions. I know there are enormous importations of them. I know one gentleman who has intro- duced thousands of them from different ports in Europe. By Commissioner Oliver: Q. Then your suggestion is that the words u tropical and semi-tropi- cal,” in paragraph 1597, should be stricken out? — A. Yes, sir ; all that paragraph or provision. 1 suggest that so as to make the rate uniform. Paragraph No. 1281, in Heyl’s Digest, has a provision for green fruits. By reading that provision you will find that certain fruits are charged with a duty of 10 percentum, while othe rs are charged with a duty of 20 percentum. I see no reason for that distinction. It would simplify the matter very much to put them all at one rate of duty. By Commissioner McMahon : Q. What have you to say about the clause providing for damage or decay, contained in the same paragraph ; is not that a source of a great deal of trouble ; is it not a blind section? — A. That section was adapted to importations as they used to be made in sailing vessels, before the introduction of direct steam transport from the Mediterranean. Commissioner McMahon. The Treasury Department has decided in different ways in regard to that paragraph ; there have been at least four different decisions in regard to it. The Witness. After many decisions, I think the department has at last come to a proper determination of the meaning of the law. But this paragraph allows only for an excess of damage over 25 per centum, and that would not now seem to be just. Under the old system of im- portation, by sailing vessels, it was probably a fact that an average of 25 per cent, of the fruit would be spoiled. The government thought it ought not to allow any abatement of duty on decayed fruit necessarily decayed; that that was a risk properly belonging to the importer or shipper. But since we began to import fruit from the Mediterranean almost exclusively in steam vessels there is a much smaller average per- centage of damage on the voyage. Under existing circumstances 1 think an allowance for damage should be made upon the excess over 10 or 15 per cent. By Commissioner McMahon : Q. Would you not favor instead of that an allowance of a certain per- centage in lieu of damages, the same as the law at present provides for the breakage on bottles ? How would it do to say 10 or 15 or 25 per cent., or whatever rate is agreed upon, as an allowance upon all impor- tations of green fruits in lieu of all damages, and making no further allowance ? — A. While that would simplify the matter at the custom- house it would perhaps work a great injustice to the importer. An im- 500 TARIFF COMMISSION. [DAVID C STURGES. porter getting his fruit in sound condition under the provision you pro- pose would beallowed the damage, while another who had suffered much greater damage than the allowed percentage would cover would not get a proper allowance, and in a single importation it might work the for- tune or ruin of the one or the other importer. Many boxes of fruit are imported which are found to be entirely sound. I do not know that there are any invoices brought in where the whole amount could be said to be sound, though the whole may be nearly sound. Q. Are fruits insured against such damage? — A. Yes, sir; I believe so. Q. Then it is an insurable interest ? — A. Yes, sir. Q. Then an importer need not be ruined if he takes the precaution of insuring his goods ? — A. No, sir; but that would add an item of ex- pense for insurance which they do not incur now, and so, indirectly, in- crease the rate of duty. By Commissioner Oliver : Q. There are a great many chances to be taken into consideration in the shipment of fruit? — A. Yes; it is very much a matter of chance, but not so much so as formerly. Nearly all the fruit sent here is sent on consignment. The next article on my notes is bulbs, mentioned in paragraph No. 1221 of Heyl : “ Bulbous roots not otherwise provided for, 30 per centum ad valorem.” I do not see why bulbs might not be put with plants under section 1388, and pay the same rate of duty — 20 per centum. By Commissioner McMahon : Q. Have you not had the question brought up as to what was a root, and what was a bulb? — A. Yes, sir; especially in reference to u lilies of the valley,” so called. In the catalogues they are put among the liliums , or bulbs, but they are not, strictly speaking, bulbs, and are now classified as plants. I have made a note in my memoranda in regard to apollinaris and other mineral waters, although they do not come in through my divis- ion. I should suggest a simplification of the law by such changes in it as would make its purpose clear. Under paragraph 1672, natural mineral waters are now free. I believe there was an extra-natural amount of carbonic acid gas said to be found in the apollinaris water, and there was some addition made to it of chloride of sodium, or salt. The Secretary of the Treasury was of the opinion that it was not, therefore, made an artificial mineral water, and I agree with him. Mr. Shultz, a manufacturer of imitation or of purely artificial waters, thought that the addition of salt and an assumed artificial introduction of car- bonic acid gas made it “ artificial,” and that it ought to pay duty as such. I would change the law so as to make “ imitations of natural mineral waters, or waters wholly artificial,” chargeable with the duty now chargeable upon artificial waters. Q. You would simply recommend a simplification of the present phraseology of the law? — A. Yes, sir; that is about what it would amount to. At present, jellies pay 50 per cent, duty, and preserves 35 per cent. duty. I see no reason for a discrimination between them. Section 953 (Heyl), relating to u glass bottles, or jars, filled with articles not otherwise provided for,” is a much contested provision. I would suggest a repeal of this provision. 1 think no member of the Commission could read that paragraph without a first impression that the duty was intended to be imposed upon the u articles” with which DAVID C. STURGE6. 1 appraiser’s department, n. y. 501 the bottle was filled; but the department has decided that the duty falls upon the bottle “not otherwise provided for,” and not upon the article that fills it, “not otherwise provided for,” and T believe that is the true construction of the law. By Commissioner Oliver : Q. What would you suggest as an amendment! — A. I would suggest the repeal of this provision which relates to the duties on “ bottles filled with articles.” When articles that pay an ad valorem rate of duty get into bottles, the rate on the bottle is the same as the rate on its con- tents. I suppose it is not the intention of this Commission to depart from the old rule that “free goods make free packages,” and will con- clude that free contents make free bottles. By Commissioner McMahon: Q. What do you recommend in regard to paragraph 954, providing for “ glass bottles or jars filled with sweetmeats or preserves”! — A. I would recommend that that portion of the paragraph be repealed. I would also like to say a word in regard to the subject of charges and commissions. 1 would recommend a return to the law abolishing the duties upon charges and commissions. I can see no reason why a box sent with silks from Lyons should pay 00 per cent,, and another box sent with figs from Smyrna should pay nothing. Boxes are merely vehicles of trade. Commissions are purely imaginary and arbitrary. The statute says that in all cases not less than 2J percent., or the usual commission of the place in which the goods are brought, shall be added to make dutiable value. These commissions are never paid, of course, in cases where goods are consigned; and I presume that in 99 per cent, of the purchases there is no charge incurred for commissions. The goods are purchased by the agent of the merchant who goes to the other side, and you might as well provide that he should render an account to the government of the cost of his voyage, and that at the end of the year the entire sum of the importation should be made up, and that whatever percentage his ex- penses would make upon that sum should be fixed as a dutiable charge. I never could see any justice or equity in charging upon costs that do not exist. Q. Aside from these considerations, is it not a source ot constant an- noyance and trouble, both to the importer and the custom-house officer, in distributing these charges and commissions on different goods and different invoices! — A. Yes, sir, it is. We have nothing to do with that matter in our department except to add them. But the depart- ment has made some remarkable decisions in regard to this matter of charges in the last two or three years. For instance, from time imme- morial, fruits have been bought by the case or box, “free on board,” in- cluding all charges. The department made a rule to the effect that the appraiser should not recognize that existing practice, but should add charges and commissions in all cases where they were not “ specified upon the invoices,” or where the invoices did not claim, in words, that they were “included in the price” of the goods. In other words, to neglect to put “ f. o. b.” on the invoices was punished by a very heavy penalty, which was in the nature of a penalty for not putting charges on the invoices which did not belong there. Commissioner McMahon. The department went further than that. If an invoice was presented and the letters “f. o. b.” were omitted, a subsequent invoice produced with the letters “f. o. b” omitted, and the 502 TARIFF COMMISSION. [DAVID C. STURGES. appraiser attempted to correct it, lie must make a double addition in estimating tlie duty, because the first invoice did not show “f. o. b.” The Witness. I believe that it did go to that extent. But in every report which I have made on such a case I have said, “It is the judg- ment of the expert, in which I concur, that the prices cover the charges.” There has been a modification of that decision, I believe, recently. Commissioner Oliver. But was not the intent originally, in putting charges and commissions on goods dutiable ad valorem, to have the cost the same to all importers? Take, for instance, a house which has an agency in New York, and the manufacturer sends his goods without cost ; they are at no expense at all in regard to the buying. Their goods come in without these charges and commissions really having been incurred. You have referred to cases where you say you have doubt as to whether any charges and commissions were paid. Smaller importing houses are compelled to send their buyers to the other side, and spend money in order to examine the goods, and they are at a cost which the government has heretofore allowed at 2J per cent., as laid down in the statute. If the smaller house spends that money, the larger house with its agent here spends nothing. One house gets the 2^ per cent, commission without having paid it, and they would have a direct advantage if the government did not say that it costs so much money to buy these goods. The average cost of buying goods is 2J per cent., because they have to employ a broker or a buyer on the other side and pay other expenses that everybody knows are connected with the pur- chase of goods. The Witness. If you will just reverse your statement you will be nearer the fact than you are. It is not the large house which paj T s the commission, but the small one. Commissioner Oliver. That is what I said. I say that the small house pays the commission generally. The Witness. Yes; but the larger house sends out its buyer, while the smaller house buys through an agent. It has to pay a small com- mission, but that does not amount to as much in making limited pur- chases as sending a man to Europe. Commissioner Oliver. We all recognize the trouble arising in regard to this matter of charges. The commissions are fixed. Now, suppose the rate of percentage were fixed and added on all goods for charges and commissions, would not that relieve you of all these troubles you have spoken of? — A. There would be less objection to the commission if it was done in that way — by putting a uniform rate of duty on the commissions or on the charges. Q. There is no question but what the invoice is made as low as it is possible to make it? — A. Of course. Q. Then their intention is to add the expenses of packing, freights, commissions to brokers and buyers, telegraphing, and postage, and all these small items that are directly chargeable upon the purchase and sale of goods. If a sum was fixed — a general percentage to cover that — would not that do away with all the trouble ? — A. Supposing an arti- cle is made dutiable at the rate of 100 per cent, ad valorem, and another article at the rate of 25 per cent, ad valorem. That 100 per cent, is charged on the box that brings the goods, and the 25 per cent, is charged in the same way. The two importers are unequally taxed on the charges, because, under the present law, the duty is levied on the charges at the same rate that it is levied on the commodity. I think it would be better to make your rate of duty upon the merchandise cover all that, and dis- regard commissions and charges as separate dutiable elements. pavid c. sturges. ] APPRAISER^ DEPARTMENT, N. Y. 503 By the President : Q. Is that not the very reason for the charges — that they increase practically the rate of duty? — A. They undoubtedly do. and most un- equally. Q. Taking off the charges would diminish, for instance, the protective effect of the duty? — A. Yes, sir; where the duty is designedly “protect- ive.” But all duties are not “protective.” Commissioner Oliver. There is no question about that. The Witness. But if you make your duty with reference to the ex- isting state of things, you can meet that objection. Commissioner Oliver. In regard to silks, if you make a rate of duty on them manufactured in Lyons, and on shawls made in India, in the same way, the transportation would be quite an item. The intent is to ascertain the cost of the goods at the shipping port and to fix a uniform rate. The Witness. I would make that upon the merchandise and not upon the vehicle in which it is brought. Many invoices show the actual charges, and there is no need of resorting to any hypothesis. By Commissioner Oliver : Q. But, on 3 r our principle, if the invoice comes with 2£ or 5 per cent, commission on it, that would have to be deducted from the entry ; in making the entry at the custom-house you would have to deduct it from the entry. I should advocate the addition of 1^ per cent., say, to the present duties, to cover shipping charges. Iu all these cases you would have to take the amount of commissions from every entry. — A. I see no objection in that. If the law were changed, the arbitrary “charges” would be immediately omitted from the invoices, and there would be no need of making the deductions on entry. I will now proceed to enumerate some other articles on which the rate of duty seems to be unequal. Why should tapioca be free and arrow- root be charged a duty of 30 per cent.? I should recommend on all these articles a uniform rate of duty. I would also make a uniform pro- vision for “soap stocks” (paragraph 1758), and “for grease for use as soap stock only,” (paragraph 1G08, Heyl’s Digest). These two provisions seem to cover the same thing. I would make them more explicit by simply providing that “ grease and oil fit for use only as soap stock” should be admitted free. There is another provision for yeast cakes, admitting them iree, while all other kinds of cakes pay 20 per cent, duty. I see no reason for this discrimination. Yams are admitted free, while potatoes pay 15 cents a bushel. I see no reason for yams being admitted free. Mustard, provided for in paragraph 1341, I would put with all other spices. Cleaned rice is provided for under the present- law at 2£ cents a pound, and uncleaued rice at 1J cents a pound, and paddy 1£ cents a pound. A great deal of difficulty has arisen as to “ cleaned rice.” The machinery for cleaning rice in the East Indies is much less perfect than that used in England and in this country. Bice that is bought aud sold as “cleaned rice” in India is not recognized in this market as such, and the India “cleaned rice” comes in here at a lower rate of duty than the English cleaned. There is very little or no difficulty in determining the market value of rice in the various mar- kets; it is so extensively dealt in that a uniform ad valorem duty might be substituted for the present specific rates. Commissioner Kenner. In changing that paragraph the word used should be “hulled” rice instead of “cleaned” rice. It costs precisely three-quarters of a cent to clean rice at Kew Orleans, and the other 504 TARIFF COMMISSION. [DAVID C. 8TURGE&. quarter of a cent is allowed for the manufacturer’s industry. If the word u hulled ” rice could be used instead of “ cleaned ” rice, that would meet the objection, I think. The Witness. Again; why should rye flour pay a duty of 10 per cent, and Indian meal, wheat, and other flours pay a duty of 20 per cent. ? By Commissioner Underwood : Q. Do you notice that there is no provision made for wheat flour at all ? — A. There is none ; therefore it comes under the general provision of unenumerated manufactured articles at 20 per cent. (Heyl, 1810.) Q. Do you know the reason why it was omitted ? — A. I have not the slightest idea. I should suppose that so important an article as flour would certainly not have escaped the attention of Congress. Under the supplementary tariff law, sardines and anchovies, when in boxes of specified sizes, pay so much per box. I think it would be well to put sardines, and all other fish put up and prepared in a manner sim- ilar to sardines, at one rate of duty. I think the duty is very high on sardines. It conflicts with none of our industries here, and I cannot understand why they should be so taxed, except on the theory that they are a luxury. By the President : Q. They are manufactured in Maine very largely. — A. Oh, that is a very different commodity. I think the American sardine is a fish en- tirely unfit to eat. Commissioner Kenner. We have a fish caught on the banks of the Mississippi called sardine, which is caught in large quantities, but it is unfit to put up. The W itness. Peanuts shelled are classified at one rate of duty and various other nuts at various rates of duty, shelled and unshelled. Why not put all nuts shelled at one rate of duty, and add another single rate for unshelled nuts? I would suggest a uniform rate on all candles, and on all materials from which candles are made. At the present, wax candles, paraffine candles, adamantine, and stearine candles are variously provided for at specific rates of duty. I do not see any reason for complicating the law with these various rates. It seems to me that a uniform rate might be made for all these varieties of candles, and another uniform rate for all materials from which candles are made. Paragraphs 1232 and 1233 cover two articles which cannot be sepa- rated, and which are provided for under the name of “chiccory root.”" Paragraph 1232 provides for “chiccory root, ground and unground,” at 1 cent per pound; and paragraph 1233 provides for “chiccory root, burned or prepared,” 5 cents per pound. Chiccory root cannot be ground unless it is burned. Elsewhere, in paragraph 1183, there is a provision for “coffee substitutes” at 3 cents a pound. These consist of acorns, pease, and the refuse of figs, dandelion root, and various other things; while chiccory is introduced here simply for the purpose of adulterating coffee, and I am not disposed to show much mercy to it. I recommend a duty of 3 cents a pound, or the equivalent of that, in ad valorem, on all forms of chiccory. Kow I come to a matter which may involve, perhaps, some discus- sion. There is a provision of law that when merchandise is advanced 10 per centum or more upon its invoice value, that that advance shall carry with it a penal duty of 20 per cent, additional upon tha article ad- vanced. There have been various decisions on that question by the 505 DAVID c. sturges. ] APPRAISER^ DEPARTMENT, N. Y. department. I suppose tlie intention of the law was to advance the duty 20 per cent, on the one article that was advanced; whereas it has- often been spread over a whole invoice, even where the goods were not identical in character, and the other similar articles on the invoice have been charged at their full value. Commissioner Oliver. That has been done as a punishment merely. The Witness. Yes, sir; and that possibility of incurring a penal duty of 20 per cent, for undervaluing merchandise has saved the government millions of dollars in duties ; but it has not been entirely successful in preventing attempts at undervaluation. In my opinion, the law does not go far enough. I would suggest that this penal duty be increased to 40 per cent., more or less, as may seem proper in the opinion of the Commission; and I think it would have an immense restraining influ- ence upon attempts at undervaluation. Following that same line of ^suggestion, I would recommend that all merchandise, where advanced 25 per cent, or more, should be forfeited. I think this severer penalty would be very effective. At present, no goods can be forfeited unless upon proof of the fraudulent intent, and there have been undervalua- tions to the extent of 75 per cent, or more, in which the intent to com- mit fraud could not be legally established. I have had recently an invoice of furniture in my division, invoiced in francs (at 19^- cents), where my advance to make value was more than equal to the substitu- tion of the pound sterling for the franc. It would probably be impos- sible, in a court, to establish the fact, or to establish the “intent,” rather, of fraud in that case, on the part of the importer and the persons im- mediately interested in the merchandise ; and that is the reason why so few cases of that kind have been brought before the courts. The diffi- culty of proving the “intention” of the party to commit the fraud, while the moral evidence is overwhelming and conclusive, has probably de- terred the collector from prosecuting many cases of this kind. I merely make this as a suggestion to the Commission, and think, perhaps, the percentage I have named should be 30 or 40 per cent, instead of 25, to work a forfeiture of the goods ; or there might be a scale carrying with it many different penalties, as, for instance, where the market value is increased 10 per cent, it might be 20 per cent, penal duty, as now; where it is increased 20 per cent, it might be made 30 per cent. ; and so om until you finally reach a point where the undervaluation is of such a character that nothing but forfeiture could properly punish the person who attempted it. By Commissioner Kenner : Q. Do I understand that you wish that that part of the clause refer- ring to fraud should be stricken out entirely, and that these penalties should be inflicted whether the fraud is established or not"? — A. The last provision I proposed was that the forfeiture should be based upon the fact of undervaluation, not the proof of fraudulent intent. The statute should make the undervaluation conclusive of the intent. In paragraphs 1277 and 1278 fire crackers are provided for. When the first of these provisions was made, the fire-cracker of commerce was about 2 inches in length, or less, and was generally put up in packs of 80 crackers to the pack, and 40 packs to the box (a box containing 3,200 crackers), and a specific duty of $1 per box was levied upon them. China is a progressive country as well as our own, and the Chinese are now making fire-crackers of all sizes intermediate between the 2-inch crack- ers of commerce and crackers 9£ to 12 inches long, with proportional diameters; and it has been insisted on the part of some of the importers TARIFF COMMISSION. [DAVID C. STURGES. 506 that 3,200 of these crackers, which cost $4 or $5 a box (of 200 crackers, more or less,) should be admitted at the same duty as the ordinary crackers costing only 75 cents a box. It would seem to be a mere farce to impose such a duty, for it amounts to a very small fraction of 1 per cent, on some of them. I would propose a uniform ad valorem duty on firecrackers. There are various provisions for dried fruits under the names of cur- rants, plums, prunes, raisins, &c. I would suggest a uniform duty on these articles; I would suggest, at any rate, the abolishment of the very absurd distinction between prunes and plums, the one paying 1 cent per pound, and the other 2J cents per pound. The only difference is a technical one. In Europe a prune is a grafted plum, and we only know the difference by the peculiarity of its size, and more especially hv the shape of the pit. A great many persons have imported plums do good faith as prunes, and have had to pay the duty of 2J cents a pound. This is an unreasonable distinction. Before the revision of the law they paid a uniform rate of duty, as I now propose they should do. Furniture is also in my division. I would recommend one rate of duty for furniture ; or, if that does not meet the views of the Commission, I should say furniture, if in part of wool or worsted, any rate which you might agree upon ; and if in part of silk, at any other rate you may agree upon. But, for simplification, I shall say that it would be better to put all furniture at one rate, of whatever material composed. Under the “ little tariff act 7 ’ of 1878, if a chair is upholstered with silk or plush which happens to be of more value than the actual wood or other single material composing the chair, it pays a duty of 60 per centum — the silk being considered of chief value. I have not heard the furniture trade object to the present rate of duty of 35 per cent, on furniture. I think they feel themselves well protected by that rate of duty, and I would make that the uniform rate. I would also suggest that the Commission should very clearly define the meaning of the words “ chief value.” The trouble in the law at pres- ent is that it uses language not definable, or definable differently by everybody who uses it. The words “ chief value” were held at one time by the department to mean that the article of chief value should exceed the value of all the other materials with which it is combined, and with this construction I agree. The department now holds, I believe, that the constituent of “chief value” is only required to exceed any one of the other materials with which it is combined. In a piece of furniture made of silk, flax, worsted, &c., silk might clearly be of a value greater than either of the others, and yet be very far from being the chief value where you take all the others together. By the President : Q. What do you suggest as the proper phraseology ? — A. That the words “chief value” shall be defined; that they shall be held to mean the value in excess of all the other materials, or the aggregate value of all the other materials with which the given material is combined. By Commissioner Garland : Q. That w r ould be in opposition to the present construction of the courts t — A. ]ST>, sir ; not of the courts, but of the department. I think the courts would take the view of the matter which I have suggested. I find in the law a provision for “composition tops” for tables, which might lead to some confusion. I never have seen a “composition top,” and I think it is an obsolete thing. Dried cherries, pears, &c., pay 10 per centum, not being otherwise T>AVII) C. 8TUKGES. | appraiser’s department, n. y. 507 provided for. I do not see why they should not pay the duty charged upon similar articles that are provided for. Why are tamarinds free ? I think no reason exists for it any longer, and they might be put in the general list with other like articles. During the war we were short of lemons, and Mr. Smith suggested to Dr. Bellows that, as lemons were scarce, tamarinds would make an excellent substitute, and many tons were brought in and used by the soldiers in hospitals. They were put in the free list for that reason. We have some difficulty in regard to seeds. I have already spoken of peas and beans. The reason, 1 suppose, that the words “for agri- cultural purposes” are in the provision of the law relating to seeds is because, at that time, there were two other provisions of law relating to seeds, making the duty dependent on the use to which the seeds were put. For instance, seeds imported for manufacturing purposes were free; so were seeds imported for medicinal purposes. But a seed that might be imported for medicinal purposes might also be used for agricultural or garden purposes, or for manufacturing purposes ; and, to make the law consistent, the word “ purposes,” already associated with seeds for manufacturing and medicinal purposes, was also asso- ciated with seeds for agricultural and horticultural purposes. I would not make the law provide for seeds for medicinal purposes, but simply name the seeds that are named in the dispensatories as medicinal seeds, and say these seeds shall be free. Commissioner McMahon. Dr. Jewett, the other evening, advocated exactly the contrary of that : that we should eliminate from the free list all the medicinal seeds, plants, roots, and herbs which are mentioned there eo nomine , and that we embrace them in the general clause pro- viding for medicinal leaves, plants, seeds, and parts of plants. He would use the words simply “ medicinal seeds,” and depend upon the dispensatory to define what they are. The Witness. We have the quince seeds, which are used by the ladies for fixing their bangs ; 99 per cent, is used for this purpose, and the remainder is used for making mucilaginous applications for inflammatory affections of the eyes, and that is the only recognized medicinal use of the quince-seed. Yet quince-seeds were passed for a long time as “medicinal seeds” free. Now the question is whether a so-called “ medicinal seed,” which is used only once in a great while as a medi- cine, shall be admitted free, when 99 per cent, of that seed is used for other purposes. I want the word “purposes” stricken out of the law in all directions ; it would bring about a clearness where there is now nothing but confusion. I also propose a repeal of the similitude clause, qs found in section No. 2499, paragraph 908 of Heyl, as follows : There shall he levied, collected, and paid on each and every non-ennmerated article which hears a similitude either in material, quality, and texture, or the use to which it may he applied, to any article enumerated in this Title as chargeable with duty the same rate of duty which is levied and charged on the enumerated article which it most resembles in any of the particulars before mentioned ; and if any non-enumerated .article equally resembles two or more enumerated articles on which different rates of duty are chargeable, there shall be levied, collected, and paid on such non-enumerated article the same rate of duty as is chargeable on the article which it resembles paying the highest duty, and on all articles manufactured from two or more materials the duty shall be assessed at the highest rates at which any of its component parts may be chargeable. I think there is wisdom enough in Congress to specify the articles on which it is proposed to impose duties, and I think we can make specific provisions of law which will cover pretty much every commodity im- 508 TARIFF COMMISSION. [DAVID C. STL RGBS. ported, and that it is sufficient to have a single residuary clause in the statute, the same as that contained in paragraph 1816, covering all non' enumerated manufactured articles. Fanciful similitudes, and similitudes to similitudes, have been resorted to to fix rates of duty. If the com- modity is definitely specified, there can be no need of a “ similitude” provision. If the present general provision of 20 per cent, for non-enu- merated manufactured articles is not high enough, make it higher. I am incliued to think it would be the part of wisdom to increase that rate to 25 or even 35 per cent. By Commissioner McMahon : Q. 1 understand you to say that on all manufactured articles not hereinbefore otherwise provided for, 35 per cent, ad valorem say, or what- ever rate Congress should agree on, and on all unmanufactured articles not hereinbefore otherwise provided for, you would admit them free? — A. No, sir. Q. It is the raw material ? — A. You still have the privilege of enumer- ating the raw material that you desire to have come in free. If you desire to encourage the importation of raw material, that would do it exactly, and that provision might be omitted altogether, or it could be made free. But you must clearly define what you mean by the words “raw material.” I believe that is all I have to submit to you in the way of specific suggestions on articles coming through my division. I have in reserve a question which I would like to submit for the consideration of the Commission. I would suggest a revision of the present law respecting the reappraisements of merchandise, and this is by far the most im- portant topic introduced this afternoon. Under existing laws we have what we call a “general appraiser” with whom is associated a “mer- chant appraiser,” who, together, constitute a tribunal quasi judicial, to whom appeals may be taken from our determinations of market value. This tribunal is invested with supreme and final jurisdiction of all ques- tions of “ market value.” But market valuations are not the sole issue in tariff laws. Questions of classification are more various and more perplexing. I should propose, if you recommend the continuance of the present form of tribunal for the trial of questions of market value, that you invest that tribunal with the decision of all questions of “ classifica- tion,” which would do away with all appeals to Washington. It would be placing these questions for adjudication before a tribunal which would have access to all the facts, and before whom all the experts could be brought instead of referring them, as now, to the department at Washington. Classifications, under the present laws, involve values to the amount of millions of dollars, and these questions are decided upon appeals taken to the Secretary of the Treasury, with ultimate appeal to the courts. Of course it is impossible for that officer to give his personal attention to all these appeals ; and, if he did, the facts are not accessi- ble to him by which he would be able to form a sound judgment in all cases, or even in a majority of cases. That is my first proposition ; to give to this tribunal, if it is to continue to exist, jurisdiction of both classes of questions — market values and classifications. But 1 would go further than that. I would create, in place of the present system, a tribunal of commerce, which should be able to make, in fact, a judicial in- quiry. This matter involves, on the part of the merchants and of the gov- ernment, millions of dollars in duties, and it would seem to be fair, both to the government and to the merchant, that that inquiry should be made DAVID c. STUBGES. 1 APPRAISER’S DEPARTMENT, N. Y. 509 under all the safeguards which the laws provide in the trial of issues be- tween citizens. That would devolve a very great additional responsibility upon what we now call the general appraiser ; it would vastly increase the amount of his business, and there should be, of course, a proportional com- pensation given for that service. If you make him a judicial officer he should receive compensation commensurate with tbe dignity and import- ance of his services. It is a matter for further consideration whether the right of trial by a jury of experts should be given in such cases; or whether the right of appeal to the district court of the United States should be provided for. I should certainly, with this enlargement and change in the character of the jurisdiction of the general appraiser, repeal that part of the present law which provides for a u merchant appraiser.” By Commissioner Garland : Q. Would you be able to get a competent jury all the time in such cases? — A. Why not in these as in other cases? I believe it is a gen- erally accepted fact that, on the average, we get something like justice from trial by jury. But I think it all important that these two ques- tions should be adjudicated by the same tribunal, and that the right to question witnesses, to sift the grounds of a man’s evidence, to deter- mine his competency and fairness, should be secured both in the inter- est of the government and the appellant merchant. Under the present regulation the merchant whose property is put in issue before the gen- eral apx>raiser is not allowed even to state his case “ argumentatively”: he cannot argue his case or examine a witness as in a court of justice. There is manifestly no “ process of law” in the present jiroceedings, yet, under them, persons may be u deprived” of their “property.” The usual form of proceeding is simply this : A form is made out containing a list of the merchandise under reappraisement. This is handed to the witness. He examines the merchandise, and, it is supposed, puts down what his judgment is as to its value in the foreign market. That paper is then handed to the general appraiser, who must use it as “ evidence” in forming his judgment. There is no provision for cross-examining the witnesses. The character and capacity of a witness cannot be legally challenged or questioned, and the appraisement of one witness, however incompetent, enters into the final judgment with just as much presumptive authority as the appraisement of any other witness, how- ever competent. I think this is a matter so grave in its character and consequences that it requires a great deal of thoughtful consideration, and, in that view, I have deemed it my duty to bring it to the attention of the Commission. Q. I will ask you one general question — whether in your suggestions you have had reference to convenience in administering the law rather than to its effect upon the revenue ? — A. I have had both under con- sideration . It is of very great importance that there should be uniformity in decisions, which there cannot be when decisions are reached through other than judicial methods. Many of my suggestions have reference purely to convenience and uniformity, and tend to simplify the law in its execution. But I think I have not been unmindful of the interests of the revenue in any matter. 510 TARIFF COMMISSION. [WILLIAM KENT- WILLIAM KENT. Lono Branch, N. J., August 17, 1882. Mr. William Kent, assistant appraiser in the silk department of the New York custom house, made the following statement before the Com mission : I will state to the Commission that a few days ago I took up the list of goods passed in my division, and hastily noted a few facts and sug- gestions as they occurred to me at the moment. I will commence my statement by calling the attention of the Commission to the articles in my division which are on the free list. Silkworm eggs, silk cocoons, silk noils, silk waste, silk bolting-cloth, and raw silk as reeled from cocoons, not being doubled or twisted or further advanced in manufacture in any respect, are all on the free list. Commissioner McMahon: Silk noils are free under the decision of the department ; they are not specially provided for in the law. The Witness: Not unless it is silk waste. Tbe next note I have on my memorandum is: “Silk partly manufactured by carding or combing* from cocoons, silk waste, or silk noils.” We assessed the duty on the first goods we received of that sort at GO per cent, as a silk not otherwise provided for. After a controversy and a correspondence with the de- partment lasting over six months they decided these goods should be free. This article (exhibiting) is carded, combed, and put up in pack- ages; the fiber is of the most beautiful quality of silk made of waste silk. All domestic manufacturers who work it up into spun-silk yarn always have claimed that it should bear a small duty. Subsequently we got the same article, but it was drawn down to the size of one’s finger; this was after the department had declared the goods to be free. I declined to pass the goods under 60 per cent, and assessed them as a manufacture of silk not provided for, for the reason that we could not tell how soon they would draw it down to just that size fiom which they could spin it like wool or cotton. This matter was held open about six weeks, and they finally consented to pay the GO per cent, duty. Since then, of course, that article has ceased to be imported. I would suggest for this class of goods a duty of about two-fifths of what would be imposed upon a spun-silk yarn. Commissioner McMahon. Which now pays 35 per cent.? The Witness. Yes, sir. If the rate was retained at 35 per cent, on spun silk, I would suggest 15 per cent, on these goods ; if the rate was made 25 on spun silk, I would suggest 10 per cent, on this. The French name is peigne , meaning a comb. By Commissioner McMahon: Question. If you gave it that French name in the tariff, would that be sufficient to indicate it clearly? — Answer. Yes, sir. It is a sufficient description to call it peigne or combed silk. Then there is the article of silk rags. We occasionally get a small lot of silk rags, the refuse of milliners 7 cuttings. My predecessor classified and rated those as man- ufactures of silk not otherwise provided for. I should have disagreed with him. I should have claimed that they were simply used as covers WILLIAM KENT.] SILKS. 511 for buttons. Not a piece was larger than the palm of my hand, and most of them were smaller. They were mostly black and colored silks, which could be used for no other purpose than for button covers. Q. You would put silk rags, then, under class 20401 — A. Yes, sir. I would make the following recommendation: Silk rags, button covers of every description, and all manufactures of cloth woven or made in pat- terns of such size, shape, or form, or cut in such manner as to be fit for buttons exclusively. By the President : Q. Is that what you recommend as a substitute for the present law! — A. Yes, sir. I recommend that in order to maintain the same rate of duty as on button covers of 10 per centum ad valorem. The next clause of the tariff I call attention to relates to silk and cot- ton hatters’ plush and hat trimmings composed of silk and paper, which now pay a duty of (JO per cent. That is a great wrong. This latter article is intended for the tips and sides of hats; there is the merest particle of silk in the paper and we are obliged to assess GO per cent, duty because it is not otherwise provided for. It should be included in the same category with hatters’ plush. Hatters’ plush may be con- sidered as only a partly-manufactured article. By Commissioner McMahon: Q. Hatters’ plush now pays about 60 per cent., does it not! — A. There are now T about eighteen qualities of hatters’ plush, and they make, per- haps, about six qualities of hats out of it, using the lowest quality for the top of the brim the second quality for the top of the hat, and the best quality for the body or sides of the hat, so that every particle is cut up for that purpose. I would recommend a duty of 20 per cent, on hatters’ plush and hat-linings composed of silk and paper only. I think that would satisfy the hatters. Commissioner Porter: The hatters want the rate fixed at 10 per cent., I believe. By Commissioner McMahon : Q. Is hatters’ plush made in this country at all ? — A. There was an attempt made to manufacture it here about twenty years ago, but it proved an entire failure, and the manufactory which was started was wound up without paying a cent to the stockholders. Commissioner Oliver. It is stated in the schedule which has been filed with the Commission that hatters’ silk plush can be manufactured in this country, and that it is classed by manufacturers as essentially a raw material. The Witness. The next note I have on my memorandum is: “Silk trams, organzine, sewing silk and yarns, or threads of silk of every description.” They should pay one rate of duty. By Commissioner McMahon : Q. You change the phraseology of the present law, do you not 2 — A. I change the phraseology in order to embrace everything that is spun into a yarn or thread. I don’t care whether it is a thrown silk or spun silk made from waste; it should pay but one rate of duty. Q. You include silk threads of all kinds ? — A. Yes, sir; all silk threads, of every name and description. Q. Sewing silk as well? — A. Sewing silk does not require any pro- tection. We have not had 500 pounds come through the appraiser’s office at New York in eight years; it cannot be imported. A sewing- 512 TARIFF COMMISSION. I WILLIAM KENT. silk manufacturer told me within a few weeks that they did not require any duty on sewing silks. I would like to explain this matter here, because I think it is one of some importance. The tariff provision you will find reads, “On spun silk for filling in skeins or cops, 35 per centum ad valorem.” In order to come under that law it has to come out in skeins or in cops. There has been imported recently, within a few months, the same identical thread in all respects except that the ends are tied. They are in 1,000-yard lengths, and are to be used as warps instead of filling, the duty on which is 60 per cent., because it is not otherwise provided for. The consequence is, we do not import one pound of it. A manufacturer of piece goods said to me, “I have no doubt I am paying 50 per cent, profit on every pound I buy, and I am buying large quantities.” I told a manufacturer of spun silk what the party said to me; he smiled and said, “ I guess he is about right. They are paying 50 fter cent, profit on every pound.” Lister & Co., of England, wrote a letter, which was shown to me, offering it at the same price as the spun silk for filling. Then there is the article of cordonnet; if it is dyed black it pays 60 per cent. duty. When not dyed it paid 60 per cent., until we had a cor- respondence with the department, which lasted about six months, and I took the ground that it was strong enough to be used as sewing silk for ready-made clothing, and the department finally decided that it should come in as sewing silk, although it is too poor in quality to be generally used for sewing silk. Therefore, if we follow the decision of the department strictly, the poorer quality that is not strong enough for sewing silk should really go back to the clause for silk not otherwise provided for, at 60 per cent. It is often made of the commonest of waste silk. Q. You recommend now that it should pay the lower rate of duty? — A. Yes, sir; that it should all pay one rate of duty. Dyed cordonnet could not be used as sewing silk because it is very brittle and rotten, and therefore comes under the “not otherwise provided for” clause, duti- able at 60 per cent. There should be no discrimination whatever be- tween any yarn, including tram and organzine, and all other threads or yarns should pay one rate of duty. Silk veils and veilings, worsted veils and veilings, and veilings com- posed of silk and worsted should pay one rate of duty. At present silk and worsted veilings pay a compound duty. There is no reason for it and no sense in it. I am now coming to a class of goods which has given us a great deal of trouble — silk buttons and buttons composed of mixed materials hav- ing silk, wool, worsted, or mohair as a conqmnent material. I do not care what the quality is, but in order to avoid this trouble about classi- fication, resulting in suits in court to recover excess of duties, I should imopose one rate of duty for those goods. Worsted or mohair buttons now pay 50-50. Q. What would you say in regard to section 1168 ? Webbings, beltings, bindings, braids, galloons, fringes, gimps, cords, cords and tas- sels, dress trimmings, head-nets, buttons, or barrel buttons, or buttons of other forms for tassels or ornaments, wrought by hand or braided by machinery, made of wool, worsted, or mohair, or of which wool, worsted, or mohair is a component material: 50 cents per pound, and, in addition thereto, 50 per centum ad valorem. A. Wherever silk or worsted appears, “mohair” ought to be in- cluded. Wherever wool or worsted is connected with the name of an article, “mohair” should be included. Q. All silk and worsted bases, you think, should pay one rate of WILLIAM KENT.] SILKS. 513 duty ? — A. Yes, sir ; even if they have either of these materials as a com- ponent material, I do not care what the quantity may be, in order to simplify matters. I now come to another article — silk laces. I would recommend the following provision in the law: “Silk lace, and all lace having silk, wool, worsted, or mohair as a component material, and beaded lace, whether on a silk, wool, worsted, mohair, flax, or cotton net.” The only way we can ascertain whether the cotton or silk is of chief value in this article (exhibiting) is by taking a piece, weighing it, sending it to the laboratory, having the silk dissolved entirely, then weighing the cotton and estimating the value of the silk and the cotton to ascertain the proportions of value. I claim that in these matters, if there is a particle of wool, silk, worsted, or mohair, it should pay one rate of duty, and not have any “chief value” about it. Lace composed of cotton or flax, or both materials combined, should pay one rate of duty. For instance, here is a mixed article (exhibiting) having a linen thread and a cotton foundation. The face of this is linen, and the little plain thread you see here is cotton. There is no sense in having two rates of duty upon that article, because it is impossible to tell just the chief value or the relative values of the two materials. The linen has heretofore paid 40 and the cotton 35 per cent. I 11 this same connection I may state that we recently had a decision on what is called thread lace. A suit was brought by Field, Leiter & Co., of Chicago, and the case was decided in their favor. It was a case where a torchon lace made of flax, paying a 40 per cent, duty, was brought in as thread lace paying a 30 per cent. duty. It was never known as thread lace any- where, and I undertake to say that the suit would never have gone against the government if it had been tried in the city of New York. 1 have yet to see the first dealer in laces who does not laugh at the idea. There should be no distinction between a lace made of flax or cotton, or the two combined; they should pay one rate of duty. Now we have 30 per cent. 011 thread lace made by hand ; 35 per cent, on thread lace made by machinery ; 35 per cent, on cotton lace made on a machine ; 40 percent. 011 flax or linen lace; and mixed lace pays, according to the value of the prominent material, either 35 or 40 per cent., unless silk, wool, worsted, or mohair is a component material. They should all be included at one rate of duty. I come next to the subject of embroidery, and simply call your atten- tion to Schedule M. We get along very well in that, although, if I had time to study the matter up, I might make some suggestions which would be valuable to you. I simply refer to the matter now. I recommend another amendment in the law, as follows: “Women’s and children’s dress trimmings composed of silk or mixed materials, of which silk, wool, worsted, mohair, or beads is a component part.” To illustrate: Here is a braid and cord with beads in the center (ex- hibiting). That is a film of silk wound around a cotton cord, and is dutiable as a bead ornament at 50 per cent. Here (exhibiting) is a silk wound around a cotton thread; a wooden mold covered with a thin film of silk, or worsted or mohair combined. We have to classify these goods by weight at 50 cents a pound and 50 per cent, ad valorem. There is no reason, right, or justice in it. All the ornaments that I have enumerated in this clause should come in at one rate of duty ; it would save us a vast deal of trouble. The next suggestion I make is this: “Wearing apparel or clothing, reacjy made or partly made, composed of cotton or flax, or both com- H. Mis. 6 33 514 TARIFF COMMISSION. [WILLIAM KENT. bined.” These should all come in at one rate of duty. They now pay 35 per cent, for cotton and 40 per cent, for flax. The next suggestion on my memorandum is: “Wearing apparel or clothing ready made or partly made (except knit goods), composed prin- cipally of silk, wool, worsted or mohair.” That should pay another rate of duty. At present woolen wearing apparel pays 50-40 per cent, and silk pays 00 per cent. Sometimes a woolen dress is trimmed with silk and we cannot tell which is of chief value, the silk or the wool, after the dress is made up. They should pay one rate of duty ; there should be no distinction. The next item I would suggest is the following : “ Silk velvet, and velvet having a few threads of cotton interwoven, will be deemed and taken to be substantially silk velvet.” I call your attention to this, be- cause it will be necessary to protect goods mostly of silk in this way. The Commissioners will probably remember the ribbon case, where the government had to refund say $2,700,000 simply because the manufact- urers put into the selvage one or two threads of cotton, which did not affect the value of the ribbons at all. By the President : Q. Was the cotton put in for the purpose of bringing the goods in at a lower rate of duty t — A. Yes, sir. Commissioner McMahon. It was just one little cotton cord ou the edge. It really improved the ribbon, for it gave it strength and firmness. The Witness. I regret to diverge from my favorite idea of an ad valorem duty by suggesting a pound- weight duty on velvets. We judge of the value by the pound weight. We take a piece of velvet, put it on a scale, and we say that that velvet is worth so many centimes per gram. We ascertain the number of grams and base our price on that valuation. We had occasion lately to advance some velvets from 23 to 30 francs. Pound weight duty could easily be applied to that article. By Commissioner McMahon : Q. What rate of duty per pound would cover the present ad valorem rate of (30 per centum? — A. I am not prepared to say what rate should be put on at present. In regard to silk and cotton velvet, known as a cotton-back velvet, I desire to state that that should be distinguished from those having a few threads thrown in. This should pay another rate of duty per pound. And I might as well state here, while I think of it, that one chief diffi- culty with goods of this description lies in one direction, that is, to ascer- tain the values of the great variety of silk mixed goods. I now come to a slight change which I would recommend: “Uphols- tery goods, composed of silk, or of mixed materials, of which silk, wool, worsted, or mohair is a component material thereof.” That should pay a duty without regard to the quality or value of each material. At present if the worsted in a piece of upholstery goods is over 25 per cent, in value it pays a duty of 50-35 ; if silk is its chief value it will pay a duty of 50 ; if the silk exceeds 75 per cent, in value it would pay a duty of 60 per cent, under the present law. All these goods might with per- fect propriety come under one rate of duty, and then they would be ex- amined in one division. Now worsted goods go to the sixth division, and silk goods come to the third division. They are divided, and yet they appear almost invariably in the same invoices, so that they have to circulate from one division to another for the purpose of classification. Worsted upholstery goods do not attach to my division exclusively, but WILLIAM KENT.] SILKS. 515 'I think it proper to insert a provision as follows : u Upholstery goods com- posed of cotton, flax, jute, grass, hemp, and metal, or either one or more of the materials named, but no silk, wool, or worsted, or mohair.” These should pay one rate of duty. Also, u Cotton or flax cords, galloons, braids, trimmings, tapes, webbings, and banding, or composed of cot- ton and flax combined.” These should pay one rate of duty. Commissioner McMahon. Now a mixed material pays 40 per cent, and a cotton 35 per cent.'? The Witness. Yes, sir. Then I would suggest this paragraph: u Silk or worsted cords, galloons, braids, trimmings, webbings, and band- ings, or mixed materials, silk or worsted being a component material.” These should all pay another rate of duty instead of having a portion pay 50-50 and others at different rates. That is as far as I have been able to go over the list in the limited time which I have had since I was notified that the Commission de- sired to hear a statement from me. I could speak in regard to black silk dress goods, but I have not had time to prepare myself on that point. The President. You can make any suggestions on that point that you may think of at present. The Witness. Black silks are charged from 40 to 200 per cent, in the dyeing; they are “ loaded” or weighted. If a simple compound weight duty was to attach to that article, it would exclude from impor- tation the lower grades of silks, those particularly which are used for trimming dresses; it would exclude them entirely. But if you put on a more moderate rate of duty per pound, with a slight ad valorem duty in addition, it would enlarge the range of silks which could be imported. I am not prepared to state what rate I should suggest, but my present idea would be about $3 per pound, with 15 per cent, ad valorem. I want to avoid square-yard duty if it is possible, for that is a terrible annoy- ance. The manufacturers, of course, will accommodate themselves to the new tariff, and will weight their silks very much less than they do now; but they cannot reduce a poor silk, for the reason that it would not have that body which a woman likes in a silk, but would be soft and flimsy; so that I apprehend that they could not carry the weight- ing of the best black silks below 35 or 40 per cent. By Commissioner Oliver: Q. Supposing a manufacturer should lighten them up and not load them, that would reduce their duty? — A. Yes, sir; but the dye would naturally increase the weight somewhat. The very ingredients of which, the dye is composed give more or less weight. I have seen a silk re- duced from 16 ounces to 12 ounces, and, by dyeing, it was carried back to 60 ounces. But it destroys the fabric — that is, there is no strength to it, and if yon burn it it will flash; it burns more like cotton, and seems to have an ingredient in it like gunpowder. The fiber breaks like cotton. The next subject I come to is silk and cotton serge linings, umbrella and parasol goods, and silk and cotton ribbons. In regard to all these classes of goods I suggest the following provisions: “On all goods com- posed of silk and cotton, silk chif value, not otherwise provided for,” one rate of duty. u On goods composed of silk and cotton, cotton chief value, not otherwise provided for,” another and lower rate of duty. I should like to have some of the members of the Commission see the trouble which we have been under in ascertaining the actual value of two materials in a piece of goods. I have a list here of the suits brought against the government to recover the difference between 60 and 50 per cent, paid on ribbons. 516 TARIFF COMMISSION. [WILLIAM KENT. By Commissioner McMahon: Q. Did every one of these cases have to be decided by the analysis ? — A. Yes, sir. This list includes a great many cases in which the importer claimed the goods contained less than 25 per cent, in value of cotton. These were not analyzed, but the others were, or the most of them. We are obliged to employ one expert who does but little else than analyze these goods. By Commissioner Oliver : Q. The changing of the wording which you recommend would obviate that difficulty? — A. Yes, sir. On that list there is a greater variety in the proportions of silk and cotton in hat. bands than in silk and cotton ribbons. There are over one hundred in that list, but not over two or three in which cotton was the chief value. I have a silk and cotton ar- ticle here, a very excellent article of neck-tie goods, paying 60 per cent., equivalent to $3.53 per pound. I also have here [exhibiting] an article composed entirely of silk. This would pay equal to $6.06 a pound. I do not know that a pound-weight duty could be made to apply to these goods with any justice, they vary so much in quality and amount of silk and cotton. When the Silk Association appear before you they will undoubtedly claim that silks do not pay a duty of over 40 or 45 per cent, at the out- side. I want to state that that may be so with regard to a few things they are not particularly familiar with; but I suppose the fact is, we are passing many silks, colored and black, at 10 per cent, below their value, because we have no means of arriving at the true value. None of the goods are bought ; they are all consigned, and every manufact- urer tries to see how low he dares to invoice these goods with the hope of their passing the custom-house. In regard to these imported silks, I desire to state that I wrote a letter to an agent in London, asking him to submit these very samples to some three or four of the very heaviest buyers of Lyons silks there, and get from them as close a valuation as they could make. I will show you what the result was. The silks that we passed here at 3 francs these experts put at 3 francs 15 centimes, within 5 per cent. The next article which we passed at $4.60 they put at $4.70; the next we passed at $4.60 they put at $4.85; the next that we passed at $5.10 the experts put at $5.10; one that we put at $6.50 the experts put at $6.30; one that we passed at $6.56 they put at $6.60; another we passed at $5.50 they put at $5.50; another we passed at $5.75 they put at $5.80; another we passed at $7.50 they put at $7.80. So that it is not fair for the silk men to claim that we are passing silks at the rate of 40 to 45 percent. There could not be a better test than this was. Still, it does not follow that the goods are not invoiced much lower. While on this subject, I will state that the advances made on invoice values in the third division in 1879 amounted to $949,000, on which the average rate of duty was over 50 per cent. In 1880 the amount was $1,128,000; in 1881 it was $926,000; for the first six months in 1882 it was $641,829, and if it con- tinues at that rate during the season it will be larger than for the year 1880, and will amount probably to $1,200,000. By Commissioner Kenner : Q. What would be the result, as regards the valuation, if these same goods were imported into New Orleans or San Francisco or any other WILLIAM KENT.] SILKS. 517 port in the country? — A. It is my honest opinion that duties are not as well collected in any port in this country as at the port of New York. I do not see how they can be, for the reason that the appraisers do not get enough goods at other places to enable them to become familiar with these complicated fabrics, and I do not see how they can get the experience we have obtained. Q. It is a matter, then, of experience and knowledge of the goods? — A. Yes, sir. There is one other thing I desire to state. In my judg- ment the silk manufacturers of this country are on an extremely firm foundation. They are all making money, the majority of them have be- come wealthy, and some of them have become very wealthy, while silk and cotton mixed goods are not being made in this country to hardly any extent ; that is, I mean the finer fabrics. One factory is making this neck-tie stuff, and they are beginning to make in this country the better quality of mixed materials. My opinion is that these manufact- urers should be protected as much as the manufacturers of the goods composed entirely of silk in order to foster the production in this country of silk mixed goods of which the amount consumed is perfectly enormous. It will reach in dollars and cents more than the silk dress goods will. Enormous quantities are made in Germany. It is something of a new experiment. The cotton yarns which have to be imported bear a pretty high rate of duty, and I hope this Commission will take this fact into consideration in dealing with the subject. By the President : Q. When you say “silk mixed goods,” what class of goods do you refer to ? — A. The goods I speak of are usually of a silk chain and cot- ton weft ; the figure is made of the weft but the chain is of silk. Then, again, we get the thing reversed; we find it with a cotton chain and a- silken weft, where the cotton is of chief value. By Commissioner McMahon : Q. That class of goods, where cotton is the chief value, you would put at a less rate of duty ? — A. Yes, sir. Q. And you would put goods where silk is the chief value, and silk and cotton goods, at the same rate of duty ? — A. I do not say that I would put them at the same rate of duty, but I would i^rotect them equally well. I wish to call attention to section 1300 of Heyl’s Digest, under Sched- ule M, which reads : Hats, &c., materials for braids, plaits, flats, laces, trimmings, tissues, willow sheets and squares used for making or ornamenting hats^ bonnets and hoods composed of straw, chip, grass, palm-leaf, willow, or any other vegetable substance, or of hair whalebone, or other material not otherwise "provided for, 30 per centum ad valorem It so happens that I have before me now a report upon, I suppose, fifty appeals where two or three different lawyers have been engaged, embracing every known substance that goes into the making of a lady’s hat, including silk and cotton ribbons, whether cotton is the chief value or not, and even of silk ribbons. They are making an effort to bring them in at 30 per cent., and I say I do not think that clause should ever have been put into the tariff at all. On one occasion when I made a report on goods appertaining to hat trimmings the department wrote back to know whether cotton was the chief value, although the article was composed of silk and cotton, which led me to think that they had some doubt of the classification of these goods, and whether they should not come in under the 30 per cent, clause. 518 TARIFF COMMISSION. [WILLIAM KENT. The President. The Supreme Court has held (and this is the point on which the famous knit-goods case was argued) that a specific desig- nation in the tariff overrules and controls any general designation. So that a specific designation for hats would control a general designation ; that is, this specific designation would bring it down to 30 per cent. The Witness. If the court decides these goods are dutiable at 30 per cent., it would embrace twenty different articles ; it is a perfect drag- net in which to catch everything used in making or ornamenting hats, &c. L. B. CARHART.] appraiser’s department, n. y. 519 L. B. CARHART. Lonq Branch, N. J., August 18, 1882. Mr. L. B. Carhart, an examiner in tbe appraiser’s department of the New York custom-house, upon the invitation of the Commission, made the following statement : I have supervision of the article of French worsted dress goods. I have been in the appraiser’s department of the custom-house at New York three years, and, previously, in the dry-goods business for more than twenty-five years. The paragraph of the tariff law which relates to my line of goods is found on page 171 of Heyl’s Digest, paragraph 1166, schedule L, wool and woolen goods. The paragraph provides — That on women’s and children’s dress goods, and real or imitation Italian cloth, composed wholly or in part of wool or worsted, the hair of the alpaca, goat, or other like animals, and valued at not exceeding 20 cents per square yard, the duty shall be 6 cents per square yard, and in addition thereto 35 per centum ad valorem ; valued at above 20 cents tbe square yard, 8 cents per square yard, and in addition thereto 40 per centum ad valorem. But on all goods weighing four ounces and over per square yard the duty shall be 50 cents per pound, and in addition thereto 35 per centum ad valorem. Now, I find in my application of this law that it is very difficult to be just to all parties concerned. Of course, it is my effort to do no injus- tice to any man while protecting the interests of the government, for I think it is only in this way that I can do my whole duty. There are two lines of distinction drawn by this law, as you will per- ceive; the principal one, and the most difficult one of application, being that based on value. We have the compound rate of duties here, aud it is in this compound rate, 1 think, that all the defects of the law are to be found. I have asked a clerk to make for me, from a rough diagram which I gave him, this little sheet, which will show more clearly than anything I can say the injustice of the law. If I am right in my opinion, the intention of levying a tariff law is to distribute the burden of taxation among the tax payers in proportion to their ability to pay, as nearly as possible; that is to say, that the rich man shall pay from his riches and the poor man from his scanty means a proportionate share. This idea is absolutely and entirely reversed by this section of the law. I find that the lowest-priced goods which are imported cost in Europe about 8 cents a square yard, and these under this section pay a duty of 6 cents a square yard and 35 per cent, ad valorem, which is equivalent to just 110 per cent, ad valorem. As the value of the goods increases up to 20 cents a square yard, which is the maximum of cost under that provision, the equivalent ad valorem rate of duty diminishes, until at 20 cents a square yard they pay equal to exactly 65 per cent, duty. As soon as the value of the goods crosses this arbitrary line of 20 cents per square yard, which is so intangible that by no possibility that I can conceive of can any man become so expert as that he can discover the difference bet ween goods that are worth 19J cents a square yard and those that are worth 20J cents a square yard, the rate of duty is changed and its ad valorem equivalent advances from 65 per cent, to 80 per cent, by one straight jump, and then from this point, as the value of the goods increases from 20 cents a square yard, the ad valorem rate of duty diminishes until it reaches about 50 per cent. So that I find that the lowest-priced goods pay 110 per cent, duty while 520 TARIFF COMMISSION. Cl. b. carhart. the highest-priced goods pay about 50 per cent. duty. I think this shows that the principle I stated has been absolutely reversed by this section and that the rich man pays the lowest rate of duty, while the poor man pays from his scanty means the highest rate of duty. I see no equitable solution of this difficulty except by the adoption of a plain and simple ad valorem duty. I make no suggestions as to what the rate of duty should be, but I believe that an ad valorem instead of a compound duty would tend, by simplifying the law, to facilitate its en- forcing, would tend very materially and directly to lessen the number of undervaluations and frauds upon the government, and would be just to everybody concerned. By Commissioner Garland : Question. Is it your opinion that an ad valorem duty would lessen the probability of undervaluation ? — Answer. I believe so. That is the opinion I hold, and I will try to demonstrate its soundness by calling attention to some facts which I think will support it. The greatest trouble with the law, and the question which embarrasses me most, is as to that dividing line in the value of goods, whether they are over or under 20 cents a square yard in value. The difference between the two rates of duty at that line, as I have shown, is exactly 15 per cent., which is a large profit for the importer. If one man can succeed in keeping his goods invoiced below that line while his neighbors, who are his competitors, are invoicing theirs above that liue and are paying the higher rate of duty, he has the great advantage at once of a very con- siderable profit in the duty alone. An illustration of this fact is now under my hands at the stores. I have there a reappraisement under consideration by the general appraiser on an appeal from an advance which I made a few weeks ago, and the whole question at issue turns on an advance of from three-quarters of a cent to possibly 2 cents per meter on the different styles of goods. The importer has repeatedly said to me, w hen discussing this advance with him, u I may as well be frank with you ; we should not raise this question if it was merely the duty on the advance, but it affects the rate of duty; that is the great question with us.” I made the addition to the invoices, and the amount of increased duties involved in this one transaction on two or three in- voices is about $3,000, and if my decision shall be sustained, as I have not much doubt that it will be, it will make a difference to that house in their importations for this season of over $10,000, the question be- ing merely whether the goods belong on one side or the other of this 20 per cent. line. A practice has grown up among buyers who go to Eu- rope which illustrates another phase of this question. They go to the manufacturer abroad and say, u I want to buy a line of cashmeres, and shall want 4,000 or 5,000 pieces in all. I want, say, 500 pieces of the lower grades and so on up into the finer goods. What are your prices V’ The negotiation is conducted on the basis of the sale of the w hole line, and if a sale is made it is understood that all goods below a certain count must be at such price as that they shall come into the United States at the low r rate of duty, and the price is made in order to meet the rate of duty, and is not based on the value of the goods, the manu- facturer repaying himself on the finer qualities. But if the purchaser went to buy the low grades on their merits he could not import them at the low rate of duty. The consequence is that the man who goes abroad to buy the lower lines of goods alone, and buys them on their intrinsic value, is compelled to pay the higher rate of duty ; and he who V L. B. CARIIART.] APPRAISER’S DEPARTMENT, N. Y. 521 resorts to this other method of buying his goods succeeds in getting them in at the lower rate of duty. By the President : Q. Are you not aware that the scale of minimurns in the tariff is arranged for the purpose of arranging a specific duty to correspond in a measure to the ad valorem; to correspond to the lower character of the goods; do you understand that to be the object of the scale of mini- mums? — A. I do not fully comprehend your question. Q. You are aware that there are certain rates of duties placed on these goods. Are not' those rates of duty arranged according to the value of the goods, to a certain extent? — A. Perhaps that is true. Q. Are you not aware that that is an objection that applies to all scales of minimum duties and all specific duties; that there is a line where that difficulty occurs and applies to all minimum duties of that character? — A. I shall have to ask to be excused from answering ques- tions as to other lines of goods ; I am confining myself strictly to my own line of goods. Whatever knowledge I have outside of that is of a general character, and I prefer to discuss the one line of goods 1 deal with. As to these goods I ought to have some specific and accurate knowledge, for I have handled them for about thirty years. Q. Here is a schedule of minimum duties scaled to a certain extent to correspond to certain ad valorem rates, and the objection made is an objection which invariably applies to all specific duties of that char- acter, does it not? — A. I suppose so. It is an objection, I suppose, that would lie against the duties that are like these; an objection which lies against all compound duties. By Commissioner McMahon: Q. I understand the witness to say that under this application of com- pound duties the lowest-priced goods pay 110 per cent., while goods of a higher quality pay only 65 per cent, up to a certain point, and above that point 80 per cent., and then, as they go higher up in price, they come back to 50 per cent. The Witness. That is it precisely. The President. My suggestion was that this was a general objection and not a specific one, as applied to this particular paragraph. Commissioner Ambler. 1 do not know that any other goods are graded in the same way that woolen goods are. The President. The scale of minimum duties applies to them. The Witness. The case which I had in hand to-day, and to which I simply refer for illustration, is one as clearly marked as I could possibly make it If I had an invoice made out to order to show a case of under- valuation I could not get a better instance of it, and yet it remains an open question as to whether those goods shall pay a rate of duty that no other importer in the city of New York pays on his goods. In other words, whether one house shall have the exclusive monopoly of import- ing certain goods at the low rate of duty. It is my effort to equalize this matter, and it is an open question whether I shall succeed. If the rate of duty was a simple ad valorem one, it would only remain for the United States Government, having the largest possible interest in the question, an interest extending to what would correspond in the busy season with a merchant’s profit of $50,000 per day — that is the amount of duty the government collects on my line of goods, $40,000 to $50,000 per day — it only remains, I say, for the United States Government to ap- ply its energies to get men who are competent by intelligence and expe- rience to determine as to the value of goods; and, in order to do this, 522 TARIFF COMMISSION. [L. B. CARHART. they have only to go into the market as merchants do and get the best service by paying adequately for it. The government then can be well served, and an equitable ad valorem duty can be applied Avitliout fric- tion, and without serious questions of undervaluation. In regard to this question of values, I have had on a whole case of goods a difference of less than 25 cents on the total cost of a case ; turn the scale and change the rate of duty, and this would all be effected by a slight increase in the rate of freight, or a trifling difference in the cost of a case or package ; such little changes ha\ T e often had that effect. I think if these things are susceptible of correction under the system I have suggested, or an ad valorem rate of duty, they deserve considera- tion. By Commissioner Ambler : Q. What is your experience in regard to the disposition to under- value goods ; what is your idea of the prevalence of attempts at under- valuation ? — A. I should say that about one-half of the goods I handle are consigned ; in other words, they are owned by the manufacturer until they are sold and the proceeds collected here. Of course, the tendency is for the manufacturer to try to get his goods from the cus- tom-house at as low a rate of valuation as possible. I think it not un- fair to presume that they would invoice their goods at 25 per cent, less than they do if they thought they could get them through the custom- house at such prices. In nearly all cases purchased goods, I believe, are invoiced at their actual purchase price ; I but rarely meet with in- stances to the contrary among the large importers. Q. HaA’e you any remedy which you can suggest to prevent under- valuation ? That would be a very important thing if an ad valorem sys- tem was adopted. — A. I know of no remedy except such as I have sug- gested. I think, in regard to the goods that come under my examination, that an experienced man handling the goods can form a reasonably just and accurate estimate of their actual value. But to draw so fine a dis- tinction as that arbitrary line which I have referred to requires is im- practicable. By Commissioner Oliver : Q. Are not all such lines necessarily arbitrary? — A. No, sir; there are some that are mathematical and easily defined. Under this clause which I have referred to, I am enabled to count the number of threads within a quarter of an inch of goods, and it is a mathematical demon- stration as to whether there are ten or ele\ r en of those lines there. If there are ten the value is fixed at one price, and if there are eleven, at another, and so on all the way up. By the President : Q. Have you any practical difficulty in determining the compound duty except in the matter of labor and time expended? — A. No, sir; none whatever, except as to this question of value, although it takes more time to apply such a law than an ad valorem one. Q. But, practically, there is no difficulty in determining the duty ab- solutely. — A. No, sir, it is only a matter of calculation. By Commissioner McMahon: Q. But is not the basis of \ r alue a conflicting one ? — A. Yes, sir, it undoubtedly is ; it varies from one season to another. Q. I do not mean that; I mean is not the basis a conflicting one on the same identical goods. If there are thirty-nine pieces in one case and L. B. CARHAET.] appraiser's department, n. y. 523 orty pieces in another and the charges were the same on the cases, one lot might pay a higher rate of duty than another, might it not 0 ? — A. That might ve*y well happen, and has happened. Q. It is sometimes difficult to fix a basis 0 ? — A. Yes, sir. By Commissioner Ambler : Q. With all the necessary care it seems very difficult to fix a basis, and, as you suggest, it varies. But in answer to the question of the President, yon say that having a basis once established it is a very sim- ple matter of computation ? — A. He spoke simply of the question of classification, as 1 understood it. When we have the invoices before us, the goods not being present, we have only to take the figures as they stand on the invoice and make the classification. Of course, this is merely a question of figures, and we are arbitrarily bound by the fig- ures as they stand on the invoice; we must accept them. In regard to a question of valuation, I have to examine the goods and to determine whether they are worth more than the prices stated in the invoice. If the goods I have examined appear to be correctly valued, and I have nothing to change in the value of them, I assume that the other goods are correct if I know nothing to the contrary, and then I accept the fig- ures as they stand and make the calculation and determine the rate of duty. I understand the question of the President to be whether there was any practical difficulty in making these calculations. Of course there is not. By Commissioner Oliver : Q. I understood you to say that you were in favor of an ad valorem duty ? — A. Yes, sir ; it is my opinion that would be the best way of as- sessing the duty. Q. At the same time you said a moment ago that half of the goods coming through your department came through the hands of agents. — A. Yes, sir. Q. And also that the natural inclination of the importer was to do the best he could for himself, and that there was more of a tendency towards undervaluation when goods were consigned to agents than when they were purchased. — A. Yes, sir. Q. Well, then, one would take it that the only bar, or the surest bar, to protect the government and have uniform duties assessed, would be the watchfulness of the appraiser. — A. I think it must come to that eventually; it depends on that to-day. Q. Then if we quit the compound rate of duty, and rely wholly on the ad valorem, the values will be assessed fairly and equally at all times, provided the appraisers are always faithful and watchful? — A. Yes, sir; and competent and honest. Q. But suppose in time they become lax, would not then the govern- ment be a little better protected with a compound duty? — A. I think the question, as it stands now, depends just as much on the faithfulness and intelligence of the examiner or appraiser as it would under that system at the point which I speak of, which is the essential point under the present law. Q. You are speaking about a particular point, and I am asking you on a general principle. I ask you, as a general principle, whether the valuations would not be more equal throughout the country in the different ports under a specific than under an ad valorem duty ? — A. Yes ; under a specific duty clearly, if we had a specific duty that could be applied with anything like justice. But I think a compound duty is open to all the objections that are brought against it. 524 TARIFF COMMISSION. [L. b. carhart. Q. What is your experience in your department as to the average cost for addition of charges, leaving out commissions, which, I understand, are fixed, the minimum rate beiug, I believe, per cent.? — A. No, sir; not always. It is 3 per cent, in Paris, and outside of Paris 2J per cent. Q. What is the average of commissions on your line of goods? — A. If an importer fails to do it, I always add 3 per cent, to all Paris invoices, and on invoices outside of Paris 2J per cent., for commissions. Q. Can you state the average percentage of charges? — A. I could not, because that is a matter which varies very materially. They have three different ways of shipping goods on the Continent, by slow freight, me- dium freight, or fast freight, and the rates of charges are very different by those different ways. Q. Is not this whole subject of charges and commissions one produc- tive of great complaint and trouble? — A. Yes, sir; I think so. My opinion is that it would be much better to abolish them. Q. Instead of abolishing them would it not be better to establish a uniform rate for commissions and a uniform rate for charges; a fixed rate ? — A. I do not think it would, myself, if you desire my opinion on that subject. Q. Why not? — A. Because it would produce great discontent on the part of the merchants. Q. The rate that would be fixed would be enough to cover the cost of getting the goods from the manufactory to the seaboard. Suppose the rate was the minimum of the cost? — A. The government receives ap- proximately a second sum in the shape of duties on those charges. Q. But then the theory of the law is to get at the cost of the goods at the place of manufacture and the cost of the transportation and ex- penses. — A. An illustration has just occurred to me which I think will be an answer to your question. For instance, I get a consigned invoice, and the manufacturer will write at the bottom of it, “Free on board at Havre.” Now, his merely writing that takes this question out of my control; that is regarded as settling the whole question. Q. That is entirely in the line of my inquiry; that the manufacturer who is smart enough to do that, or who is quick enough to make this agreement to have his goods delivered “free on board,” has the advan- tage of his brother importer who neglects that. — A. He has made no agreement at all; he consigns the goods. The man who owns the goods simply writes on the invoice, “ Free on board at Havre”; be lias made no agreement with anybody. The only difference between us is that you would have a minimum rate and I would wipe out the charge altogether. Commissioner McMahon. I understand the practical difficulty to be this. With such an invoice as Mr. Carhart speaks of, the charge is already there. If the manufacturer can write “ f. o. b.,” he can write in the same way 1 per cent, or 14 per cent, for charges. Suppose that Congress announces that on all invoices there should be added 5 per centum in allowing the charges and commissions, and the manufacturer takes advantage of that by writing the 5 per cent, in allowing the charges and commissions in lieu of prices. Commissioner Oliver. But I would prohibit him from doing that. I would take the consular invoice price as made, or the appraiser’s price at the port of entry, and to all ad valorem duties make an absolute fixed rate for charges and commissions. Commissioner McMahon. Then you will meet this objection. There are many kinds of goods which are only bought and sold in that man- ner; they are delivered “free on board” as an actual tact in the com- merce of nations. Now the manufacturer can and will take advantage L. B. carhabt. 1 APPRAISER^ DEPARTMENT, N. Y. 525 of that by simply invoicing his goods and saying the above price in- cludes 5 per cent, in lieu of charges and commissions. Commissioner Oliver. But we should in this way get rid of this troublesome division of charges and commissions. The Witness. I do not see why you would not get rid of it in the other way just as well. Commissioner Ambler. You can put 5 per cent, on the bill and say it is to cover the charges and commissions, fixing that as an arbitrary amount, or you can add an equivalent to the rate and fix it in that way. Commissioner McMahon. I want to bring out just one point, and that is this: I understand that several of the gentlemen who have recom- mended ad valorem rates as opposed to fixed lines of division in value, say that in the appraisement of goods under ad valorem rates you can ascertain the value of the goods within a certain percentage anywhere from 2 to 10 or 15 per cent. They cannot undervalue so much as this larger percentage, but in fixing an arbitrary fine you are bound to bring the question to so fine a point that it will be impossible for any expert to get exactly at that line. The Witness. Yes, that is so. When I entered the service of the government, some two and a half years ago, I had a different view of this subject, but my experience has changed my opinion. I will simply suggest one other point that has arisen in my division. There is some feeling of discontent with that provision of the law which fixes the date of shipment absolutely as the date when the value shall be determined. There is a feeling of discontent on the part of a good many of the importers with that provision, because they complain that it is a punishment for their investment of their capital in advance, which in my line of goods is an almost absolute necessity ; that it is a punish- ment for their enterprise in purchasing their goods in advance of the time of shipment, and giving the orders the season before, as they are obliged to do to conduct their business successfully. They say that if they take advantage of the market, and subsequently the market ad- vances instead of their getting the benefit of their investment, they are punished for it. By Commissioner Ambler : Q. That is to say, they do not get as much benefit from their invest- ment as they anticipate. They get the benefit of the investment in every way except that they must pay the rate of tariff on the value of goods at the time of the shipment? — A. Yes, sir. I say to them, “You get a portion of the benefit”; but they say , u We are entitled to the whole benefit.” In French cashmeres, for instance, which is a staple article, the largest importers invariably give their orders from three to six months ahead of their time of shipment, the price being fixed at the time of the giving of the order. By Commissioner Oliver : Q. But home valuation would make the rates the same at all times and in all ports, wouldn’t it? — A. I do not believe in a home valuation. By Commissioner Ambler : Q. I observe that most of the custom-house officers are bitterly op- posed to a home valuation ; why is that? — A. With regard to my own case, I can say that I am very closely confined in the store during the busy season, and I do not see how I can know what is going on all over the city of New York while I am at work in the fifth story of a building on Washington street. 526 TARIFF COMMISSION. [L. B. CARHART. Commissioner Garland. How do yon know what is going on in Paris, then ? The Witness. Admirably well, because I get nearly every invoice that comes from Paris to this country of goods in my line. Seventy -five per cent, of all the goods in my line that come into the United States come to the port of New York, and all these invoices pass through my hands. By Commissioner Ambler : Q. If you were appraising goods and fixing their value every day you would have the means of fixing the home valuation'? — A. I have a knowledge of the prices in Paris, which I obtain from the invoices ; but how should I know what the merchants are doing in New York? Q. You would become acquainted with the prices of goods from day to day and know when changes accrued ; you would certainly have some means of knowing. If you are going to take the invoices as being absolutely correct, then, of course, your objection is a, good one. — A. When I have these invoices of purchased goods I see every transaction that occurs, and that, taken together with other facts that come to my knowledge personally, furnishes the basis upon which I estimate the value for the consigned goods. By the President : Q, I understand that you have a very large line of invoices coming in here all the time from importers whose reputation is unimpeachable, and these invoices give you the basis for your judgment of the value of goods of that class. — A. Yes, sir ; they furnish the very best basis. By Commissioner Ambler : Q. Suppose the importer in this country was required to file a state- ment under oath of the value of the goods he received ; would not that be a safe basis to estimate the home values upon ? — A. He would prob- ably give us his asking price. The asking price is not the value. The true value is the price at which the sale is made. Sales are frequently made above and below the market value, and that whole question ot market value is an exceedingly difficult one. My own judgment of the matter is that the proper market value is the price at which a given quality of goods can be purchased in the open market by' a person in good credit. Often we find goods which cost more than the market value, and I sometimes find them purchased under extraordinary con- ditions at prices less than the market value. I have advanced invoices where I thought they had been so purchased, and have insisted oir the advance because I believed them to be charged at less than their true value. I have sometimes to claim in regard to goods invoiced as “jobs” that I cannot recognize them as “job lots,” and claim that they are charged at less than the market value. 1 have to deal not simply with the fact that they are purchased, but with the actual market value of the goods. Of course my action in such a case results in discussion and sometimes in a little bitterness of feeling on the part of the importer. CYRUS A. STEVENS.] appraiser's department, n. y. 527 CYRUS A. STEYENS. Long Branch, N. J., August 18, 1882. Mr. Cyrus A. Stevens, assistant appraiser New York custom-house, in response to the invitation of the Commission, made the following statement : My division includes the appraisement of diamonds, watches, <&c. My assistant appraiser (Mr. Imanuel Auerbach) has covered the ground pretty nearly, and I have not much to say in addition to what he has told you, except in regard to a few points. In one branch of our divis- ion we have had some difficulty ; in regard to bronze statuary. Bronze is provided for specially at 35 per cent. duty. The first copy of a bronze statue, modeled by a practical artist, if it is accompanied by a certificate to that effect, is allowed to come in at 10 per cent. duty. It is first modeled in the clay, then in plaster, and then in the hard metal. Each copy of the hard-metal statue, even when reproduced twenty to fifty times, would be exactly like the first one, and yet we are compelled to pass upon the first one as being the original, and we have to depend upon the certificate of the artist which accompanies it to determine that fact. No expert can tell the difference between the first, second, third, or twentieth copy. But, according to the ruling of the department, that particular one is allowed to come in paying 10 per cent, duty, w hile all the subsequent copies have to pay a duty of 35 per cent. It seems to me that some change should be made by which all should pay 35 per cent. I see no reason for making any distinction. I would not recom- mend that statuary of metal, porcelain, or terra cotta should come in as works of art, as has been suggested. I think they should pay accord- ing to the material. We have also had some difficulty in classification of jewelry, a ques- tion that was determined by a case in court some three or four months ago. Before that time there were some four or five classifications of jewelry; since the decision I have referred to it is all classified at one rate, viz, 25 per cent., with the exception of a certain class of goods. Within a w T eek or two we are called upon to classify brooch buckles, &c., as hat ornaments, according to material, although they have heretofore been decided by the courts to be jew r elry. Some samples were sent from Boston to the Treasury Department, and it was decided there that they should pay duty as hat ornaments. The appraisers at Boston report that they are too light in weight to be worn as jewelry. A brooch is a brooch, in my opinion, no matter how it is used, whether for a pin or on a hat, and therefore should be classified as such. I cannot see the ne- cessity of drawing a distinction. I would also suggest, in cases where appeals are made from our class- ifications, instead of sending such appeals to the department at Wash- ington for determination, that they be sent to the board of general ap- praisers, or that a board of judges should be created with whom the assistant appraisers and examiners can communicate, and who can sit where the articles in question can be irfspected. At present we de- scribe the articles as fully as we can, but the person in the department who passes upon them does not get a real knowledge of what the goods are. This is evidenced by the fact that only two months ago we had a decisiou governing this matter of ornamental jewelry, and now it is 628 TARIFF COMMISSION. [CYRUS A. STEVENS. again confused by a decision in the department subjecting hat orna- ments to the rate of duty provided for the materials of which the article is composed. By Commissioner McMahon : Question. As I understand, you make the point that certain brooches were* first classified at New York according to the material of which they were composed, that a protest was filed and the case went to court, and the court decided that such brooches should pay the duty imposed upon jewelry. Now, the importer in Boston sends a . brooch to the depart- ment in Washington, and it decides that it shall pay according to the material of which it is composed % — Answer. Yes, sir; they wrote from Boston to know how we classified the imitations of jet and iron and the baser metals made into personal ornaments. We answered that we class- ified them under the decision of the court as jewelry. The appraiser there made the report to Washington saying that the goods were of a light and fragile nature, and could not be made use of as jewelry; that they were to be used as bonnet ornaments, although they might be worn by the poorer classes as brooches. Q. What suggestion do you make to avoid such ambiguities in the law ? — A. I would suggest that all ornaments of this kind should be classified as jewelry. Q. How can Congress legislate on an article about which experts dif- fer so widely as to whether it is or not an article of jewelry? — A. I would classify all ornaments of this kind as jewelry. Some of these very articles that were before the court when the decision was made were imitations of jet and steel; they were there for them to decide upon, and they decided they were articles of jewelry. Yet these very same articles were passed upon by the Treasury Department a short time since, and the decision given that they should be rated according to the material of which they were composed. I think we should have a board of officials to whom all such matters should be referred. The board of general appraisers are at the appraiser’s department constantly, and see the goods and know what classifications should be made of them, as well as the application and use to which they are put. Either the general appraisers or a board of judges should be created to deter- mine these questions instead of sending them on to Washington for de- termination. There is another difficulty we have to encounter, and that is in regard to precious stones and imitations thereof, which pay 10 per cent. duty. Imitations of diamonds, topaz, garnets, emeralds, and all precious stone pay 10 per cent. duty. The best imitation we have met with is that of black onyx. It is very hard for any one to distinguish between the real stone and the imitation. The Treasury Department has decided that imitations of onyx shall pay the same rate as imitations of jet, while all the other imitations of precious stones pay a different rate of duty. I would suggest that all imitations of precious stones should pay the same duty. At present we have two classifications as a result of the ruling of the department. We have considerable trouble also in regard to the word “antiquity,” as to what shall be defined as an antiquity. According to the decision of the department, an antiquity is something made previous to the fif- teenth century. It is my opinion that we should embrace the fifteenth and sixteenth centuries, and admit articles made within or previous to that time free. These articles serve as educators to the public taste, and therefore I think there should be no duty placed upon them. A CYRUS A. STEVENS.] APPRAISER'S DEPARTMENT, N. Y. 529 great proportion of the goods entered as antiquities, however, are not genuine antiquities. Our people are deceived very often, so that really few antiquities come in here. I have a vase at the store now which is worth about 50 francs, but the owner had to pay £110 for it. I classified it for duty as an imitation. The number of genuine antiquities which would be admitted would be very limited. I suggest that we admit all antiquities free of duty, whether imported for private use, exhibition, or sale, when made in the fifteenth or sixteenth centuries or previously. By Commissioner Garland: Q. Would not that encourage this very imposition of which you have spoken? — A. No, sir, I think not, for we should assess all these imita- tions for duty. In the case I referred to, the owner of the vase believed he had a genuine antiquity and was not satisfied with my classification, and finally brought General Cesnola in to inspect it, and was not satis- fied with his decision, and then called in Mr. Feuardent, who pronounced it of modern manufacture. By Commissioner Ambler : Q. You suggest as a mode of determining these questions of classifi- cation, that a board of appraisers or a customs court should be created. Is there any reason why the board of appraisers cannot discharge the duty there as well as a court? — A. No, sir; if they were authorized to decide these questions, I think they could do it satisfactorily. I spoke of the board of general appraisers because they go from port to port and are familiar with articles of merchandise, and are perhaps better versed in these matters than any one else. I think it would be better to refer these matters to them rather than to the assistant appraisers or experts, because we have put ourselves on record from the beginning by our classifications. My idea is that a board of general appraisers or a board of judges who are capable of deciding these matters, should be author- ized to determine all these questions instead of sending them to Wash- ington, as is done at present. Q. That would involve the necessity of having a board of judges or appraisers at every port? — A. Yes, sir; if it was determined to create a court, it would. But the matter might be left to the four general ap- praisers who are in existence now. Q. How frequently do these general appraisers visit the different ports? — A. They are with us every month. I suppose General Mere- dith and his associates spend the largest part ot their time at New York. Q. How frequently do they visit the other ports? — A. I do not know. Q. Is it your idea that ultimate classification would be better deter- mined by such a board than by a court? — A. Of course the merchant would have the right to appeal from their decision to the court, as he does from the decision of the Secretary of the Treasury at the present time. Q. What is your idea as to whether such a board could be made an ultimate tribunal for the decision of these matters? — A. I do not think you could create a board which would be the ultimate tribunal. The parties would always have the right to appeal to the courts. Q. Or they would have the right to sue the collector? — A. Yes, sir. Q. What reason exists why classifications should not be made ulti- mately by such a board as that instead of by the Treasury Depart- ment? — A. Here is case in point. I had a lot of goods entered as antiquities by a gentleman in New Y r ork, and according to a decision H. Mis. 6—31: 530 TARIFF COMMISSION. [CYRUS A. STEVENS. of the department defining antiquities, there was only one piece found in the whole lot that was a genuine antiquity, although they were cor- rect copies of the ancients in every way ; I had to classify them according to the material of which they were composed. I bracketed the whole and wrote across, for the benefit of the collector: u These goods are old, and fit only for cabinet use.” But the gentleman had to pay the duties, and he has instituted suit in the courts for the recovery and won. He sued on the ground that these articles were simply for his own private use, as souvenirs for his cabinet. If he had appealed from this classifi- cation of 35 and 45 per cent, to the board of general appraisers, they would probably have sustained me under the present law. Q. And according to the fact you should have been sustained in that case? — A. Yes, sir, according to the facts; and I think the government should treat such things very liberally, because the subject is one within very narrow limits. When you consider that all the museums of for- eign countries are supported by the different governments, and have agents picking up all such articles of antiquity, there is a very small chance for Americans to secure an original antiquity, and as a rule they have to be content with copies. But as educators they are valu- able, and if imported for private cabinets, or public institutions, and not for sale they should be free. DANIEL W. LEE.] appraiser's department, n. y. 531 DANIEL W. LEE. Long Branch, N. J., Avgust 18, 1882. Mr. Daniel W. Lee, examiner, New York custom house, upon the invitation of the Commission, made the following' statement: I think that photographs should be specially provided for. In the law as it now stands they are not provilded for at all. Photographs on paper are classified as assimilating to engravings at 25 per cent, duty ; on porce- lain they pay 50 per cent, duty, and on other materials they are classified as manufactures of those materials, except that on enameled copper plates they are classified as assimilating to paintings at 10 per cent., while they really should all be classified at one rate of duty. If on glass, the duty is 40 per cent. By Commissioner McMahon: Question. So that, practically, photographs pay a duty of 10, 25, 40, 45, and 50 per cent, at present; five rates of duty? — Answer. Yes, sir. Then there is a paragraph providing for brushes and hair pencils, brushes paying a duty of 40 per cent, and hair pencils 35 per cent., while really there is no distinction between the two articles. A hair pencil may be called a small brush. I think they should be classified under one rate of duty. In regard to fashion-plates, I think the law should read : “ Printed from steel, Avood, or other material.” As the law now reads, fashion plates printed from steel or wood are admitted free, but printed in any other way, from any other material, they are required to pay a duty of 25 per cent. If printed from steel they are admitted free, but if printed from engravings on stone they pay a duty of 25 per cent, as printed matter, and yet they are really of the same character of printed matter. Music printed with lines under the present law pays a duty of 20 per cent. I think it should be dutiable as printed matter, it really being printed matter. Cases occur where a book is printed partially with words alone and partially with music printed with lines, and it is difficult to deter- mine whether it should pay duty as printed matter at 25 per cent., or as music printed with lines at 20 per cent. The law in regard to paper reads: “Paper sized, or glued, suitable only for printing paper, 25 per centum ad valorem”; while in paragraph 1371 it says: “Paper, antiquarian, demy, drawing, elephant, foolscap, imperial, letter, and all other paper not otherwise provided for 35 per centum ad valorem.” I think they all ought to be at the same rate of duty; there seems to be no good reason for the different rates of duty. The law as it now stands is virtually prohibitory. 1 would suggest as an amendment, that the paragraph providing for paper should include printing, writing, and drawing papers at one rate of duty. Sheathing paper is provided for at 10 per cent, and paper hangings at 35 per cent. Electrotype plates are not provided for in the law, and they are classified as assimilating to stereotype plates, which pay 25 per cent. I think they should be included by name with stereotype plates. It is very difficult to arrive at the correct dutiable value of these plates for 532 TARIFF COMMISSION. [DANIEL W. LEE. many reasons, and as tlie quantity imported is very small, I think they might all be put on the free list. Photographic albums are not mentioned in the law at all. I think they should be specially provided for. By Commissioner Ambler : Q. How are they now classified? — A. They are classified generally as manufactures of leather and paper, but if silk is the chief value, then they become a manufacture of silk. WILLIAM S. HOYT.] appraiser’s department, n. y. 533 WILLIAM S. HOYT. Long Branch, N. J., August 18, 1882. Mr. William S. Hoyt, examiner in tlie New York custom-house, in response to the invitation of the Commission, made the following state- ment : I have been connected with the appraiser’s department of the New York custom house for the last thirteen years, all of which time, with the exception of about one year, has been spent in the division in which cotton fabrics are examined. These fabrics, as you all know, constitute an extremely varied and complicated class of merchandise. There are made in the fourth division of the appraiser’s department, inclusive of those made upon flax and hemp, about one hundred and . twenty different classifications. I wish to recommend a modification of that portion of the law under der which I am acting, in regard to cotton goods, so that there will be less difficulty in understanding its meaning. I would suggest, simply, that manufacturers of cotton, now classified under a great many different heads, be divided into two separate and distinct classes : First, bleached and unbleached, and, second, colored ; and that all the vast variety of cotton fabrics be put under these two divisions, instead of having thirty or forty different ones as now. By Commissioner McMahon : Question. You recommend an ad valorem rate of duty, do you? — Answer. Yes, sir. Q. About what difference in the ad valorem rates in these two classes of bleached and unbleached and colored, would cover the present rates of duty ? How much difference is there in the ad valorem rate of duty; is there 5 or 10 per cent, between the bleached and unbleached and colored ? If we put two ad valorem rates of duty, one on the first class, as you recommend, and another on the second class, as you recommend* how much should a second rate of duty be higher than the first rate A. About 5 per cent, higher. By Commissioner Porter : Q. That is the difference between the bleached and the colored ?r-A I would put the bleached and unbleached under one class, to cover the present gradations. If the unbleached and bleached are put in one class, and the colored are put in another, 5 per cent, more act valorem on the colored would cover the present rate of duty. By T Commissioner McMahon : Q. What rates will cover about the present average duty on the bleached and unbleached goods f — A. I should say 35 per cent. By r Commissioner Oliver : Q. What are your reasons for recommending the abolition of the pres- ent compound rates of duty ? — A. My r reason is that a compound rate of duty makes the matter very complicated in a great many respects. There is at present a difference in the duty on goods counting under 100 threads to the square inch, on goods between 100 and 200 threads, and on goods over 200 threads. Under these different rates some classes of goods, exceeding 200 threads, are dutiable at 7£ cents per square yard and 15 per cent, ad valorem, until they reach a value that causes 35 per cent, ad valorem to be the higher rate ; which value is about 38 cents per square yard. 534 TARIFF COMMISSION. [WILLIAM 8. HOYT. By Commissioner Porter: Q. Will you please take up Schedule A and begin at section 2504 and give the Commission your idea of the changes which should be made? — A. Paragraph No. 921 reads as follows: On all manufactures of cotton (except jeans, denims, drillings, bed-tickings, ging- liams, plaids, cottonades, pantaloon stuff, and goods of like description) not bleached, colored, stained, painted, or printed, and not exceeding 100 threads to the square inch, counting the warp and tilling, and exceeding in weight five ounces per square yard, 5 cents per square yard; if bleached, 5£ cents per square yard; if colored, stained, painted, or printed, 5^ cents per square yard, and in addition thereto 10 per centum ad valorem. There is a great deal of difficulty in deciding what assimilates to a jean. There are very tine table cloths manufactured in Germany, that in manner of weaving resemble jeans; there are also bed quilts woven in a similar manner, and it is a hard matter to determine at what rate * they are dutiable. Q. Would you suggest that the words “goods of like description’ 7 should be stricken out? — A. Yes, sir; I would. Q. That is the only change which you recommend in that paragraph ? — A. 1 would also recommend that all manufactured cotton fabrics, bleached and unbleached, should pay a duty of 35 per centum ad valorem, or what- ever uniform rate is decided upon, and all manufactured colored cotton fabrics, a duty of 40 per centum; thus making a difference of 5 per cent, between the rates, whatever they may be. I think a difference of 5 per cent, is sufficient, and would bring as much duty to the government as under the present classitications Q. Under these circumstances, you would drop paragraphs 922, 923, 924, aifd 925; there would be no need of these? — A. I don’t think the law should be so framed as to make the rate of duty depend upon the number of threads to the square inch. That has always struck me as a very unjust way of assessing the duty. The next paragraph, regarding jeans, drillings, &c., I should be in favor of striking out. Q. What would be the effect if all the paragraphs from 922 to 927, in- clusive, were stricken out? — A. As regards cotton threads, I am not an expert. Mr. Clark, w T ho will probably come before you, can better ex- plain that matter to you. By the President : Q. You propose an ad valorem rate of duty upon all these goods? — A. Y"es, sir. Q. Are you not aware that the cotton manufacturers of the country have always maintained that the square yard duty w 7 as a very essential thing for their security ? — A. The principal difference it makes to them is in regard to goods costing under 10 cents per square yard, and the larger portion of the goods imported at the present time is composed of fabrics costing from 10 to 25 cents per square yard. The whole bus- iness has altered very much since the time when the tariff laws were framed. By Commissioner McMahon : Q. Suppose the rate of 35 per centum on bleached and unbleached goods, and 40 per centum on colored fabrics of cotton, and 35 per centum on all manufactures of cotton in addition, not otherw ise provided for, were adopted, w ould the American manufacturer be as well protected as he is at present under the present complicated rates, in your judgment? — A. I think he w T ould. By the President : Q. And as well protected as under the present square yard duty ? — WILLIAM 8. HOYT.] appraiser’s department, n. y. 535 A. Yes, I think be would ; and not only that, but I tbink tbe govern- ment would receive quite as much, if not an additional amount of reve- nue. I cannot see any injury that it could possibly do to either party, and I know tliat it would give very great satisfaction to tbe importers to know exactly wliat percentage of duty they would have to pay. By Commissioner Porter: Q. Wbat I gather from your remarks is that you would recommend two ad valorem rates of duty exclusively? — A. Yes, sir; I think that important. Commissioner Porter. I have here a petition signed by all the prin- cipal cotton men of the country, in which they say that specific duties should be re ained in preference to ad valorem duties, wherever practi- cable. In this respect the witness’s statement conflicts with the state- ments of the manufacturers of cotton. By Commissioner McMahon: Q. Is there as much, or nearly as much, difficulty in determining the foreign market value or wholesale price of cotton fabrics as of many other kinds of goods? — A. I do not think, as a general thing, there is as much difficulty. In most cases it is easily determined; but in some classes of goods there is difficulty. Cotton velvets are difficult to ap- praise, owing to the manner in which they are manufactured aud the substance contained in them, and I don’t think the value can be deter- mined by weight, by reason of the difference in superiority of the finish. With that article we constantly have difficulty, and it is a very impor- tant article of importation. I pass at least 100,000 pieces of cotton velvet annually. Within the last five years the importations have in- creased wonderfully, and this year they |)roinise to be heavier than ever before. They are manufactured now so that they resemble silk velvet so nearly that they enter conspicuously into the dress of some of the best people of the United States. By the President: Q. Are they made in this country? — A. Yo, sir; I believe not. I don’t know that any have ever been made here. In other cotton goods there are constantly new things coming up, manufactured in a different way, so that it is difficult to determine their exact value. But we have been able, generally, to ascertain the value by making inquiries of those com- petent to inform us, though of course this method involves a great deal of trouble. There is more difficulty in determining the values of some of these fabrics, especially those manufactured by new processes, than one would suppose, as in many cases the actual value of the material used constitutes but a small portion of the commercial value. Of course there are certain staple articles, especially of British manufacture, the value of which we are able to determine with great certainty. In re- gard to velvets, of course there is a difference of opinion. 1 have ad- vanced large quantities of German velvets. The German manufact- urers claim that they can make them cheaper than the English, and the English manufacturers, on the other hand, claim that the Germans buy their cloths and merely finish them up, which, however, is not the case to any great extent. However, there is considerable difference in cost between German aud English velvets. The German manufacture of velvets is very extensive, and I find great difference of opinion as to values, even among experts, and regarding the products of both coun- tries. I notice by the papers that Assistant Appraiser Kent mentions the weight of silk goods as a test of value. I do not think that the value of cotton goods can be determined by such test. 536 TARIFF COMMISSION. f WILLIAMS. HOYT. By Commissioner Underwood : Q. I notice that in section 2504 it says: u If colored, stained, painted, or printed, 5J cents per square yard ; and in addition thereto 10 per centum ad valorem.” That includes what are commonly called “ prints.* Are there many of those goods imported into this country ? — A. Yes, sir; a great many are imported under the name of cretonnes. Q. What do the invoices accompanying these prints that are brought from England show the general cost of them to be? — A. At present we have none of the article commercially known as prints” imported. When I first entered the appraiser’s department the importation of prints amounted to at least 100,000 pieces a year ; but at present we do not have 300 pieces a year; in fact, we have none at all. The price is very low indeed in comparison with what it used to be. English prints ranged from 17 cents to 32 cents at New York when I first went into the business. These same prints at the present time can be imported at less than one-third that price. American prints of the same quality were 17 cents when I first went into the business, when the tariff was first made, and they have been frequently sold, recently, at 4J cents — equally fine goods. The American prints have driven and in my opinion will continue to drive all English manufactures of the same nature out of the market. By Commissioner Porter : Q. Are we importing any English cretonnes now ? — A. Yes ; we are importing large quantities of them. Q. Are you aware that we manufacture them largely in this country, also ? — A. Yes, sir; 1 know that we manufacture them here, too. Q. And as cheaply as they do in England? — A. Yes, sir; I think we undersell them in some respects. 1 do not think we have the finish and color equal to the foreign article ; but in price we can undersell them. Q. How about the patterns ? Are we not ahead of the English in our designs ? — A. I think our patterns are quite as good as theirs. I think our dyeing of the goods is more permanent than theirs as a gen- eral thing. There are a great many German goods, counting under 100 threads to the square inch, that they have imitated here very well. Within a week I have seen some and could not have told the difference. The German article will cost about 0 cents to lay it down in this coun- try, and I have seen the same goods in American patterns offered at 7^ cents. A German, who has been importing these goods, told me that he would not import any more of them, for he could buy the American manufactures and make a better profit on them. In fact, many New York importers of the lower grades of cotton goods are providing them- selves with stocks from the American manufacturers, instead of from the European markets. By Commissioner Oliver : Q. How long have you been connected with the custom-house in New York ? — A. About thirteen years. Q. Had you experience before that in the dry-goods line ? — A. Yes, sir; I was brought up as a boy in a country store; then went into a jobber’s store in New York, and then into an importer’s store. I have been since 182'J in New York Oity, engaged actively in the importing and jobbing of dry goods, and in passing them through the custom- house. ELLIS CARR.] ENGLISH BISCUITS. 537 ELLIS CARR. Long Branch, N. J., August 18, 1882. Mr. Ellis Carr, representing Messrs. Peek, Erean & Co., of Lon- don, England, manufacturers of biscuits, made the following statement: I desire to say a few words in regard to the trade in English biscuits as distinguished entirely from what is known in this country as crackers. The trade in this article in England is now very extensive. The busi- ness was established about thirty yearsagoand has grown until English biscuits have become practically an article of general household use. I think I may safely say that there is hardly a householder in England who would be ignorant of what a fancy biscuit is, but in this country the use of biscuit has not been so extensive. It is a comparatively new industry, though it has developed considerably within the last few years, not only in Great Britain, but in those European countries where pro- hibitive duties have not prevented their introduction. In some of these countries the consumption has so increased and is increasing that factories have been built there on the English system, thus by competition tending to augment the demand for these goods. Hitherto, as any one may observe, this has not been the case in this country, though there is no reason in our opinion why it should not become so. Referring to the United States schedule of tariffs, based, we believe, on that of March, 1861, we do not find that fancy biscuits are anywhere mentioned, though they pay a duty of 20 per. cent ad valorem, as U unen- umerated manufactured articles.” This, as at present levied, is practi- cally prohibitive, as besides the 20 per cent, on the full value of the invoice, incidental expenses, consul’s fees, &c., make it equal to about 25 per cent. Were the 20 per cent, duty entirely removed, the advan- tage would still remain with home manufacturers on account of the distance and the impossibility of speedy delivery, but the taste and therefore the demand for these articles of luxury has still to be created in the United States, which we believe is to be best done by those who have already an established business in England. We submit that this industry is worthy to be considered as a distinct trade, and the duty, if any, fixed upon consideration of the merits of the case. Europe charges on net value or weight. Charging duty upon packages is a peculiarity of American trade. Our firm employs nearly 2,000 working people. There is another factory of biscuit at Reading, a few miles out of London, employing as many or more people than we do. Some of these factories, I am in a position to state, have invested large sums of money in the business, and I hope you will agree with me that it is an industry worthy of en- couragement, We only desire to be put on a fair footing with other industries in this country, so as to give our business here a chance for development. That, in a word, is my case. Since English biscuits were introduced in Europe, I know of at least six new factories that have been started to manufacture on this princi- ple which we have had to compete with, and which, in spite of a certain amount of duty against us, have increased their trade. At one time these biscuits were as little known on the continent of Europe as they are at present in America. 538 TARIFF COMMISSION. f ELLIS CARR. By Commissioner Garland : Question. I understood you to say that, in your opinion, the taste and demand for these biscuit in this country could be best encouraged by the manufacture of the biscuit in England. — Answer. No, sir; not entirely; either here or in England. I believe we are in a position to start the trade here, and in that way create a demand for them in this country. Q. Why do you not manufacture the biscuit here to start with? — A. That is easily answered. We have a personally conducted business in England. We have not men who have the technical knowledge whom we could send over here. The great difficulty in this country is the cost of wages. The wages are much lower in England than they are in this country. Q. What is the difference in wages? — A. In some instances the wages here are fully fifty per cent, more than is paid in Europe. We would have to pay just about double for labor in this country. By Commissioner Underwood: Q. Is there any other reason except the difference in wages paid why these biscuit might not be manufactured here? — A. None that I know of. I believe they are made here to a certain extent. In 1870 and 1871 we sent £20,000 worth of goods out, but the duties being so high the importation has been greatly reduced. Q. All the material necessary for their manufacture is produced in this country, is it not? — A. No, sir; not all that we use. We buy our flour wherever it is the cheapest. We do not bind ourselves to use Ameri- can flour. We also find difficulty in getting butter here. The mode of packing butter in this country is not so perfect as it is in France, where we get the most of the butter we use. Q. But if you should start a factory in this country all these ingre- dients — butter, flour, and everything else — could be obtained here to enable you to make these biscuit. — A. Yes, sir; there would be no trouble about that. JAMES F. HALL. J 539 appraiser's department, n. y. JAMES F. HALL. Long Branch, N. J., August 18, 1882. Mr. James F. Hall, assistant appraiser, New York custom-house, upon the invitation of the Commission made the following statement: I have been connected with the New York custom-house about fifteen years, and an assistant appraiser twelve. The principal thing I desire to urge upon the Commission is the necessity for getting rid of some of the present inconsistencies and in- congruities in the tariff. I have noted down in a general way some suggestions I would make in that direction, which I will proceed to state. There are so many relations and interests to be considered in connection with the subject of duties that I should hardly feel justified in making auy recommendations except in cases where the inconsist- encies referred to exist. I would suggest that in the revision of the tariff the classification of goods should be made more general. Articles of like character and of the same material should be, as nearly as possible, subject to the same classification. There are many articles of similar character where the rates of duty imposed upon them are widely different, and the assembling of these articles together and putting them under one rate of duty would, I think, tend to simplify the arrangement of the tariff. The tariff law is an arbitrary one, and is not to be argued on any principle of right. But it seems to me there might be a consistency in it which the present tariff' does not possess, as I will exemplify as regards my own division. A large number of the decisions of the department, as well as the decisions of the courts, are founded on commercial designations. A number of the tariff laws refer to commercial designations known at the time of the enact- ment of the laws. But commercial designations change frequently, and that which was a well-known commercial designation at the time the law was framed may not be so to-day. The courts have held that the commercial designation is that known at the time the law was enacted, but this becomes a question of proof, and leads to a great deal of confusion and misunderstanding. I do not know that this matter could be entirely remedied, but I think if the terms of the tariff were made more with reference to the material referred to of which the articles are made, it would perhaps do away with a great deal of that difficulty. By Commissioner McMahon: Question. What do you suggest as a remedy ? — Answer. That the gen- eral terms of the tariff law should relate to the materials of which the articles are manufactured, and that there should be a less number of these commercial designations. General terms, such, for instance, as manu- factures of iron, should include a large number of articles known under commercial name, such as trace chains, halter chains, fence chains, anchors, hammers, sledges, nuts, smashers, bed screws, hinges, railroad chairs, cast-iron butts and hinges, &c., all of which are now specially provided for at varying rates of duty. By Commissioner Oliver : Q. W ill you iff ease give us a further instance of that ? — A. I will try to 540 TARIFF COMMISSION. [JAMES F. HALL. before I am through with my statement ; I do not recall other instances just now. In regard to articles composed of two or three different materials I would suggest that the statute should be so framed that the article should be assessed at the rate of duty assessable on the component material which pays the highest rate of duty. A provision to that effect is already in the law, but if the several parts should be separated in the invoices so as to be readily separable in the assessment of the duty, then the duty should be assessable at the rate chargeable on the several com- ponent materials in the proportion that they enter into the value of the whole. That is the case in machinery now. Under the decision of the department, where steel and iron are separable in this way they pay separate rates of duty. But I suggest that such a provision should be applied to all classes of goods, and be made the ruling princip'e ; that where an article is made of two or more materials that can be readily separated, each material should pay the rate of duty assessable upon it. Thus, an article composed of brass and glass, valued at $20, each material as it enters into the whole manufacture being of equal value under the present rates of duty, would be assessed on manufacture of glass 40 per cent., $10, on the brass 35 per cent., $10, the separate value being stated on the invoice. That would prevent, in a measure, this question of commercial designations governing the classification. When an article is composed of two or more fine materials, the separate values of which are not expressed upon the invoice, then any such ma- terial that is less in value than 5 per cent, of the whole value of the article shall not control the classification. That is to say, when the value of any one material which might pay a very high rate of duty should be insignificant (and the word u insignificant v had better be defined by a certain percentage, say 50), it ought not to control the rate of duty assessable on an article composed of materials that are many times its value and pay a less rate of duty. Under the present law the depart- ment has decided that when a component material paying t he highest rate of duty is insignificant , it shall not control the classification. The term “ insignificant w lias never been defined ; it has varied from 2 or 3 per cent, up to 10 per cent. I think that one or two matters that amounted to 10 per cent, were decided to be insignificant. I should say, if an article contained less than 5 per cent, of a certain material it should not control the classification. It is my opinion that the most just rate of duty is an ad valorem duty; that is, a basis for a just assessment of duty. The value of an article should govern the amount of duty that should be paid to the govern- ment. The simplest form of assessing a duty is, undoubtedly, the specific rate; and the least desirable and most complicated of all is the com- pound duty. There are instances when a compound duty may be neces- sary, but otherwise it is undesirable. In cases where the duty is specific it should be calculated in reference to the ad valolem rate. I mean by that that where values of articles materially change, as is the case with certain steel and iron, and where the duty is specific, the proportion of payment to the government varies very materially. I will note an instance. The duty on steel not otherwise provided for is 30 per cent. ; on manufactures of steel it is 45 per cent. I take it for granted that all steel was intended to come under one or the other of the provisions made for steel not otherwise provided for, and manufactured steel. Of course I do not refer to bar steel, for that is not manufactured; it is only in a condition to be manufactured, though it is not, of course, in a crude state. But I mean everything that is far enough manufactured to designate the purpose for which it was intended. It would seem JAMES F. HALL.] appraiser’s department, n. y. 541 natural that steel of all kinds between these two different classes should pay a rate of duty between 30 and 45 per cent., whereas the change of values in this article briugs many of the materials up as high as 180 per cent. duty. Steel in ingots to-day pays a duty of about 180 per cent. Steel in blooms, provided it is what the department has chosen to name as the commercial term “railway blooms,” which is one degree farther advanced than the ingots, pays 45 per cent, as manufactures of steel not otherwise provided for, for certain sizes, and other sizes pay a duty equal to 180 per cent. This certainly is not just. Q. When the duty was put on ingots and the law was made, the in- gots were hue, cast, crucible steel, but since that time the Bessemer discovery has been made, which has revolutionized the business of the world, and the other steel that you speak of, the railway bloom steel, at 45 per cent., is an eutirely different article, and is imported largely. There are no ingots imported for the reason that the duty, equal to 180 per cent. (2J cents per pound) is prohibitory. — A. I was simply referring to ingots as an illustration. Ingots, blooms, coils, sheets, steel wire, and so on — all these articles have changed in their use. It is the changed character of the article and its value in the market that I want to get at to show the injustice of a specific duty without this duty having any relation to the ad valorem. That is the point I am coming to by de- grees. In regard to iron, the law says that it shall pay certain specific rates of duty, and it is provided that it shall not pay a doty of less than 35 per cent. Frequently the changes in the market require us to classify this iron at 35 per cent, so that the government shall not re- ceive less ad valorem. Why not make a provision that it should not pay more than 45 per ceut. u ? If this principle applied to steel, then blooms and coils and other articles of steel would not show such varied rates of duty, but would vibrate only between the maximum and mini- mum points. I would suggest a provision in the tariff, not only relating specifically to steel, but wherever a rate of duty is specific it should bear its relation to an ad valorem rate. I would like to call the attention of the Commission to this matter. There is, as the Commission are doubtless aware, an open-furnace pro- cess, and much more metal is made by that process than by the Bessemer process. It really has a larger market than the Bessemer, but no one can distinguish the difference in the product, whether made by the Bessemer or the open-furnace process, although the processes are alto- gether different. Although the process converts the iron into an article not strictly steel, yet it is a steel-making process. In the open-furnace a great deal of old waste iron is used. Bessemer metal is, under the statute, classed as steel. The open -process product is not always so classed. Q. Do you not think it would be well to have an exact definition in the law of the different kinds of steel ? — A. Yes, sir. A case has lately been tried in Boston which was decided against the government, wherein certain iron, or steel, made by open-furnace process, and which I claim to be dutiable as steel, under the provision relating to Bessemer steel, was claimed under the carbon test to be iron. It was a very low grade so that you could take horseshoe nails made from it and bend them the same as malleable iron. Still it had passed through a steel-making process, and while it was in fact neither iron nor steel, it could not be said to be iron. The matter does not seem to have been properly brought before the court, for the court decided that it was iron, and that the duty on iron should be paid on it. Had the same product been from a Bes- semer furnace the law would have made it pay the same duty as steel. 542 TARIFF COMMISSION. [JAMES F. HALL. I think that is a difficulty that should he overcome; the test of carbon ought not to be the test whether it is assessable under the provision for iron or steel. I think all these processes ought to be included alike in some general provision so as to make the provisions of the law more definite. Any product of a furnace making a metal further advanced than iron, whether by Bessemer or other process, should be subject to the same classification. That is about all I have to say in regard to the subject of iron and steel. Q. You recommend an ad valorem instead of a specific duty as being more just, as I understand you? — A. Yes, sir; as a general principle I think it is. There are cases when a specific duty would be much more convenient, but if that specific duty could be based so as not to go above or below a certain ad valorem value, then these violent changes in metal and other things could be provided for and the unequal rates in proportion to values that now come from a specific duty would be avoided. Q. Take, for instance, pig iron; do you think that it would be more just to put an ad valorem rate of duty upon that? It is imported from England, Germany, and France, and may come into a dozen different ports in this country and be assessed at a great many different values. It may be appraised at a less rate of duty in San Francisco than in New York. I cannot see why you think that would be a more just rate of duty. — A. The exact values cannot be more easily ascertained under that form of duty, but they can be just as easily ascertained and equal- ized at the different ports as other merchandise. If a certain kind of iron should to-day bring a certain value per ton, and in three months’ time there came a scarcity which doubled its value, as frequently hap- pens, then it would only be paying the same rate of duty when it came into the country at this enhanced value as it would when it was coming in at its initial value. Now, the duty being specific at so much a ton, but not less or more than so much percentage on value, then the gov- ernment would always get a rate of duty somewhere in proportion to value. Q. That is true, but still the government is not always seeking that particular thing. In your department have not the specific duties worked well and without complaint from the importer? — A. Yes, sir; except where they have beeu excessive, as in steel in ingots and certain sizes of steel blooms. It is an easy way to assess duties. Q. You have had very large importations of steel rails, and for a while they could not be produced fast enough in this country. Suppose steel rails had nearly doubled in price, would not an ad valorem duty have been prohibitory? — A. Not to so great an extent as certain blooms and other kinds of steel at the present time, and the foreign and domestic markets would soon equalize that question. I do not advise an ad va- lorem duty ; I only advise that when the article pays a specific duty that the rate in relation to ad valorem shall be between two certain figures. Q. Generally I understand you to recommend ad valorem rather than specific duties. — A. No, sir; I do not in all cases recommend the ad valorem duty, although 1 think the most just way of assessing duty is on the ad valorem principle. Still I do not recommend it to the exclu- sion of other modes. I know there are instances where it is not con- venient to assess it even where it is the most just form of assessing duty. But I do not think there is any justice in the tariff law as a rule; it is an arbitrary thing altogether. The simplest form of duty, which is also a very important consideration in our department, is the specific duty, and the least desirable is the compound, yet they are all necessary.. JAMES F. HALL.] appraiser’s department, n. y. 543 By Commissioner McMahon : Q. Following out your suggestion as to a minimum and maximum limit, do you carry with that suggestion the idea that the maximum limit shall be that rate of duty ad valorem which attaches to the highest fin- ished articles manufactured of the materials of which this article comes, and the minimum shall be that rate of duty which attaches to the lowest and most unfinished forms of the material! — A. I mean it should apply to the specific article which is being appraised. Q. You do not understand my question. A steel in crude form, say scrap steel, pays 30 per cent., and a finished article of steel pays 45 per cent. But here is a steel bar which is not a manufactured article; nei- ther is it a crude article, strictly speaking. Do you advise that the min- imum limit of a steel bar shall not be less than 30 nor more than 45 per cent, on that particular article ! — A. Yes, sir, I do on that article, but not on any other article; not on the scrap steel or on the highly-finished steel. By Commissioner Oliver : Q. Do you have much trouble in regard to the rates of duty on ma- chinery! — A. Not very much, except in this regard: where there is a royalty on the machine it is not always possible for us to know it, but we generally find it out before a long time. Or if it is a new article that we are not acquainted with we are apt to inquire in relation to it from the consul and other sources. But this question does not often arise. By the President : Q. You can speak in regard to any other branch of the subject that you desire! — A. I have a memorandum here which I have made in re- gard to the charges and commissions. We find a great many complaints from Importers in regard to these charges and commissions. I think if the matter could be so arranged that the commission should be always a certain amount, say not less than 2J per cent., that it would obviate a great deal of difficulty. The provision of the statute is now that the usual rate of commission shall be allowed at the place where the article is purchased, not to be less than per cent. The law says not less than 2J per cent. Sometimes it is charged at 5 per cent. If a firm orders from Sheffield cutlery, guns, or anything of that kind, and orders direct from the manufacturer and has dealings with him, they pay usually 2j- per cent, commission, but if the order goes through a commission agent the commission is usually charged at 5 per cent., and in some instances at 7J per cent. Of course those who have to pay the charges and com- missions are dissatisfied and we cannot always tell what rate should be allowed. In cases where the rate is 5 to 7^ per cent., according to cer- tain conditions, we cannot always ascertain those conditions and we may do injustice to the importer. I think the whole ground could be covered without loss to the revenue by providing for a definite rate to be paid for commissions. Q. Could not a conditional duty be paid on the article to include both commissions and charges! — A. Yes, sir; I think it could. Q. What rate would you name for charges in addition to the present duty! — A. I should think from 2 to per cent, in addition would be sufficient, say 2£ per cent, for commissions and 2 to 2£ per cent, for charges. By Commissioner McMahon: Q. Would not 1 per cent, cover the whole matter! — A. Yes, sir; in 544 TARIFF COMMISSION. [JAMES F. HALL. many cases it would. Where goods come from the interior country the charges are only to the border. Perhaps 1 per cent, would be large enough. If goods are sent from Switzerland and shipped through any of the ports of Trance the dutiable charges on it cease at the border. By Commissioner Oliver: Q. Most of our heavy goods which come from Germany are sold “free on board,” are they not ? — A. Yes, sir; nearly all heavy goods are. The decision of the department has chauged these matters frequently. For instance, there is no provision in the law for machinery as machinery. If the different portions of the machinery are separately packed and the value stated in the invoice so that they can be easily specified, then they pay separate rates of duty; if not, then they pay the highest rate of duty imposed on any one of the materials of which it is made. Q. What would you think of a suggestion to put machinery in at an ad valorem rate and charge according to the full value stated in the invoice ? — A. There is this objection to that proposition. Machinery made of different materials, such as iron, steel, &c., pays different rates of duty, but if a general provision was inserted in the law covering machinery, then articles would be imported under that clause and called machinery, even though they were only intended for the paring of ap- ples. The terms would be so changed and distorted that many articles would be brought in contrary to the intention of the law. I think all these things should pay according to the materials they are made of. If steel and iron were to pay the same duty under all circumstances there would be no trouble about machinery. The trouble comes now where they are consolidated together. Take, for instance, a steel ax where the steel is rolled in and is an absolutely component part of the article. In that case the law is positive as regards its paying a duty on steel, because the steel in it cannot be separated from the iron. Q. Would you classify an ax as machinery? — A. No, sir; I would classify it as a manufacture of steel, dutiable as steel under the law. Q. But it is composed of steel and iron? — A. Yes, sir; steel being a component part. Q. You do not think you could suggest a clause that would cover machines and machinery and place an ad valorem duty on them ? — A. No, sir; I think it would complicate rather than simplify the matter to do so. I was for some time at the head of the second division of the appraisers* department, and will state my experience in regard to the matter com- ing under my observation at that time. That division passes jewelry, watches, &c. Jewelry, as hitherto defined under the decision of the department, related to precious metal and jewels, but under the later decisions of the courts it covers all the manufactures of brass, iron, glass, and all those materials that were formerly referred to as mock jewelry wheu used in the form of jewelry. The term “jewelry” and other like terms which are indefinite, on which scarcely two persons agree in their definition, ought not to be used in the text of the tariff. The present law reads, “precious stones and jewelry,” and of these imitations of jewelry are now, under the decision of the courts, classed as jewelry. Diamonds, when separately entered, pay 10 per cent., and manufactures of gold pay 40 percent. ; if the diamonds are gold mounted as jewelry then the whole pays 25 per cent. Manufactures of brass, or iron, or composition metal, of which a large proportion of these goods are composed, pay a duty of 35 per cent.; compositions of glass, not set, pay 10 per cent., and if set 30 per cent. ; and manufactures of glass JAMES F. HALL. | appraiser's department, n. y. 545 40 per cent. The question is whether or not the term u jewelry” should be used when so many interpretations can be placed upon it, or whether these things should be left to pay the duty which is imposed on the mate- rials under the different clauses providing for them. A certain kind of buckle, when worn on the person, is st\ led jewelry ; if on the hat, then a manufacture of brass and glass, at one time paying 25 per cent, at another 35 and 40. If I had time I would speak also in regard to printed matter. Books or printed matter pay at present a duty of 25 per cent But the paper on which they are printed pays 35 per ceut. The full manufactured article therefore pays a less duty than one of the materials of which it is composed. The injustice of that you perceive at once. By Commissioner McMahon : Q. What kind of paper is it that you refer to? — A. It is paper more or less sized. Unsized paper pays 20 per cent. There are very few books, except common ones, that are printed on unsized paper. I also desire to call attention to the duties assessed upon gold and silver ores in combination with other metals, and the products of such ores, unrefined, known as base bullion. Gold and silver ores, as such, are free, as are also the refined products of the same. When, however, these ores are mixed with base metals, such as argentiferous galena, &c., or are reduced into what is known as base bullion, a duty is assessed upon them that is prohibitory ; and they are sent to Wales (England), France, and Germany for treatment, and a valuable industry is thus lost to this country. Heretofore these products have not been large, but since the Mexican Government has removed the prohibition on the export of bullion and ores containing more than a certain low percentage of precious metals, and since the increased development of Central and South American mines, the production has greatly increased, and will continue to in- crease in the near future, so as to make the subject one of importance, and therefore entitling it to your consideration. Many of these mining interests are near to our borders, with present and growing facilities of communication, and the capital and enter- prise by which they are being developed are from American (U. S.) re- sources. Base bullion, under department decision of November 16, 1875 (S. S. 2507), is required to pay duty in accordance with the preponderance of weight and quantity of metal contained in it, and not according to the value of the metals therein contained. This decision was also made to apply to ores by decision of the department of May 2, 1879 ; thus, an argentiferous galena ore, containing 5 per cent, of lead, would be re quired to pay the duty assessable on lead ore, i. e., 1J cents per-pound, $33.00 per ton. although the silver might be many times the most valu able part of the component materials of the ore, but not greater in weight and quantity. The same condition of facts applies to base bull- ion, in which lead being the preponderating substance in weight, a duty of 2 cents per pound would be assessable on the whole weight of material. I recommend that gold and silver ores be continued on the free list; that when these ores are composed of mixed substances, then an assay of the same shall be furnished on entry, or that the percentage' of vari- ous substances be stated upon the invoice; provided the percentage shall exceed five per centum of the weight, bulk, or value of the ore; H. Mis. 6 35 546 TARIFF COMMISSION. [JAMES F. HALE. that when 5 per cent, or more of any base metal shall be contained in ores of gold and silver, then the same shall be separately classified for duty at the respective rate i)rovided therefor, and if less than 5 per cent, in value it shall then be considered as not affecting the rate of duty. I fix the limit at 5 per cent, for the reason that at least this amount in galena ores is required as a flux, and in cupriferous gold ores it is near the limit at which the ores can be treated for the copper at a profit. JOHN DYMOND.] SUGAR CULTURE. 547 JOHN DYMOND. Long Branch, N. J., August 38, 1882. Mr. John Dymond, of New Orleans, La., appeared before the Com- mission and made the following statement: Gentlemen of the Tariff Commission : I beg leave to call your attention to the sugar industry of Louisiana, its past history, its great depression, the special causes inducing the same, its present condition and slow revival, its possibilities in the near future, and the resulting advantages to the country at large. It is a question of vital importance to our State, the sugar industry being its chief support and the one to which its fertile lands are well adapted. It is the almost exclusive support of from 350,000 to 400,000 people, and employs $90,000,000 of capital. The production of sugar in Louisiana began in the early part of the century, and steadily increased until at the outbreak of the war it equaled one-half the consumption of the entire country. With the war and the disorganization of the labor system, the production of sugar in Louis- iana virtually ceased. But 5,000 tons were produced in 1864, and sugars previously selling at 6 cents, and now selling at 6 cents, then sold at 16 cents, the loss of the Louisiana crop thus enhancing the cost of sugar throughout the world. The high prices stimulated the production, which increased to 9,000 tons in 1865, and 20,000 tons in 1866, and 75,000 tons in 1870. During this time the industry was struggling with powerfully opposing influ- ences. The reorganization of the labor system on the basis of free labor, and the peculiar complexity of the sugar industry, made the contest at times seem a doubtful one. However, the general range of prices was good, and the minimum duty on foreigh sugars* was 3 cents per pound, and soon followed every evidence of rapid recuperation. Plantations rose in value ; old fields were replanted and new ones laid out. Now sugar-houses were being erected and large purchases of machinery were being made, and the rapid rehabilitation of the industry seemed to be at hand. Tbe West was looking again to the South for sugar and molas- ses, and hundreds of steamers went laden from Pittsburgh, Cincinnati, Louisville, and Saint Louis, with plantation supplies, including every article known in domestic and mechanical economy, and returned laden with sugar and molasses. Then there fell upon us a blow that was even worse than the war; for it came upon the new industry just rising from the ruin caused by the war. Congress in 1870 reduced the minimum duty on sugar from 3 cents to If cents, and then came a new series of disasters. The crop of 75,000 tons in 1870 was followed by but 64,000 in 1871, 54,000 in 1872, and 45,000 in 1873. During the years 1871, 1872, and 1873 two-thirds of the sugar commission houses in New Orleans became bankrupt, and the valuation of plantation property fell one-half. The ownership of plan- tation property, and commercial relations therewith, injured commercial credit, and general ruin seemed imminent. Louisiana sugars were produced with free labor at good wages, and could not compete successfully with the slave-grown sugars of Cuba, and ’548 TARIFF COMMISSION. [JOHN DYMOXD. with the slave, cooly, Chinese, and peon labor of the tropics, without fair protection against the same. The results of the war were accepted without a murmur. The old laborers were employed as freedmen at the highest wages paid anywhere for agricultural work. The relations be- tween employer and employe were cordial, and not a complaint was heard; when suddenly this political blow was struck at the land, and the lieedman of Louisiana found himself in competition with the slave across the Gulf, and the freedman and his industry were being driven to the wall. In 1875 Congress advanced the duties on sugar 25 per cent., making the minimum 2-fy. Thus was restored only about one-third ot the reduc- tion of 1870. No other leading industry of the land had its protection diminished so nearly one-half as had our sugar industry in 1870, and, as an industrial problem, none other so deserved protection, as it employed freed labor as against slave and cooly labor elsewhere. The minimum duty of 3 cents was 71 percent, greater than the new minimum of 1.75 cents, and the addition of but 25 per cent, of this 71 per cent, did not give adequate relief, as the duty did not then equal the cost of our free labor over that of the slave labor in Cuba, but it afforded considerable relief, and the crop that fell to 45,000 tons in 1873 rose to 110,000 tons in 1880. This moderate increase was, however, disappointing. The domestic sugar industry was one in which Americans formerly took a great pride. The value of foreign sugars consumed in the United States reaching about one hundred millions ot dollars, Louisiana was expected by its production to retain that treasure within our borders, and by the sale of its produce to the other States, and by the purchases from them of equivalent supplies, to thus develop an iuter-State trade of two hun- dred millions of dollars. All this can yet be accomplished, and wise legislation will hasten that result. We are not now protected by the existing minimum duties to the extent of the cost of our free American labor over that of the low forms of labor used in the tropics. By American energy, American in- vention, and American machinery we hope to overcome this disadvan- tage, if the minimum duties remain unchanged. The frequent agitation of the sugar tariff, and the resulting insecurity of the capital invested in sugar production, have prevented that development of our industry that we might fairly have expected. We have millions of acres of land the most fertile in the world, and peculiarly adapted to the production of sugar. This delta of the Mississippi, built of the alluvium of its great valley, is the Holland of the New World, and should and will rival Plolland in its enormous wealth and prosperity. The culture of sugar in Louisiana is as legitimate as that of any other crop in the Union. An average yield of sugar cane per acre, equal to the average of subtropical countries can readily be obtained. Our canes may be slightly less sweet, but we harvest a crop every year, whereas in the tropics it requires from twelve to eighteen months for their plant canes to grow and ripen. We have occasional frosts and Hoods. The latter shall hereafter be better guarded against by our own efforts, and by by those of the general government, as is now contemplated, and the danger from the former will be reduced to a minimum by the increase of capital and the resulting increase of facilities in the industry. I would make the positive statement that there is not a leading crop pro- duced in the United States that averages greater certainty of a fair crop, so far as quantity is concerned, than the sugar crop. The short grain croj^s in the West last year sustain this statement. JOHN DYMOND. SUGAR CULTURE. 549 In considering the sugar industry of Louisiana, the most important factor therein will be found to be human labor. There is no other crop, and scarcely any other leading article in the country, of which the value of the finished produce includes so great a proportion of human labor. The crop of 1880-81 sold for about $22,000,000, and of this about 70 per cent., or $15,500,000, was paid out for human labor and was the chief support of 400,000 people. The supplies that these $15,500,000 paid for were produced in the other States, and there contributed largely to the support of 200,000 or 300,000 more people. Thus the gravity of the case is readily seen. Destroy us by ceasing to protect us against slave and other low-grade labor and you peril the subsistence, stop the pro- gress, and endanger the support of some 700,00a people. I will show wherein we are not now protected to the extent of the dif- ference in cost of American labor as compared with the slave, cooly, Chinese, peon, and other degraded labor of Cuba and the tropics. The Cuban planter pays for his Chinese labor $4 per month, or $48 per year, and the estimated cost of feeding him on rice and jerked beef is 10 cents per day, or $30 per year. Other incidental expenses will make a total of not exceeding $100 per year. How hard their lot is, is shown by the frequent suicides of Chinese laborers in Cuba. 1 heir slave labor, of course, gosts them less. The standard wages in Louisi- ana for first-class field laborers is from 85 cents to $1 per day ; for second- class, 75 cents to 85 cents; for special work, such as ditching, building levees, &c., $1.25 to $1.50; for sugar-house work, $1.25 to $2.50, and extra for night work, and there are furnished the laborer a comfortable house, garden, and firewood. During the harvest season, which con- tinues about ten weeks, or seventy days, the laborer may, at his option, earn 05 cents for working half the night. Ihere is always plenty of work to do, and his employment is constant. Forty-two weeks of ordi- nary labor equal two hundred and fifty-two days, or $252 ; ten weeks’ harvest season, or seventy days, is $70, and seventy half nights, at his option, at 05 cents, is $45, or a total of $;,07 that the unskilled laborer may earn, and thousands of them do it, and this is over three and a half times the cost of the same labor in Cuba. Mechanics and other skilled laborers are paid much higher rates. A careful analysis of our expenses in i>roducing sugar in Louisiana develops the fact that the cost of production is composed of 70 per cent, human labor and 30 percent, supplies, such as feed, oil, coal, tools, implements, and machinery, prin- cipally made of iron. The crop of Louisiana sugar of 1880-’8l averaged about fully fair, and sold at about cents per pound. As in very few instances was any money made that year, we may set down the crop as costing what it sold for, and 70 per cent, of this GJ cents would give 4.55 cents per pound expended for human labor. As labor, as shown before, costs in Louisiana three and a half times as much as in Cuba, the Cuban would pay but two-sevenths of this 4.55 cents expended for human labor in Louisiana, and five-sevenths of it, or 3J cents per pound, is the excess we pay for labor as against their slave and semi-slave labor. Tbe min- imum duty on sugar is 2.19. There have been collected during the past five years on all sugars imported 2.39 cents per pound, or .80 cent per pound less than the additional cost of our labor, per pound of sugar, as compared with the cost of the Cuban’s slave or semi-slave labor. The slaves of Louisiana are gone, and there is not a murmur of discontent thereat. The result is cheerfully accepted, and no one wishes it other- wise; but the lands are there, the freed men are there, the people are all there, and only ask you to protect them against the slave labor across 550 TARIFF COMMISSION. fjOHN DYMOND, tlie Gulf, and then with American energy, invention, aud machinery we shall defy the world to surpass us. The general good of the whole country demands that careful consid- eration should be given to the bearing that the sugar industry of Lou- isiana has upon the other States of the Union. Those engaged in the production of sugar-cane are engaged therein to the almost entire ex- clusion of all other crops, experience having shown this to be the most successful course to follow, the lands being ill adapted to other culture. Therefore all the supplies of every kind used in the industry come from the other States. All of the flour, meal, meats, furniture, dry goods, cloth- ing, boots and shoes, horses, mules, machinery, implements, tools, oils, belting, hardware, wooden ware, and coal, come from the other States, and the entire country seeks Louisiana as a market. In the year 1880-’81 this trade with the other States, based upon our sugar crop, amounted to $44,000,000, the sale of our crop of sugar and molasses to them $22,000,000, and the purchase from them of that quantity of supplies, and had not the duty on sugar been unfairly reduced in 1870 that mter-State trade would now amount to $88,000,000 instead of $44,000,000. To develop such trade Great Britain has ever used subsidies aud protection. She has preserved her home market for herself until production was so cheapened that protection became useless. Certainly this government should care for and protect this existing $44,000,000 and prospective $200,000,000 of trade arising from the sugar lands of Louisiana. All this will apply equally to the sugar lands of Texas, of Florida, and of Southern Georgia. In all those States a beginning has been made. Texas has made considerable progress, and offers an enormous area of excellent sugar land not nearly so well adapted to any other culture. Florida was engaging/considerably in the sugar culture before the war, and is now again resuming it. A little has been done in Geor- gia for many years, and in time the sugar industry can be made a lead- ing one in all these States, and with a hundred millions of people the United States can make all her sugar at home. The sorghum interest of the West is developing aud producing an enormous quantity of mo- lasses, and some sugar, and bidding fairly to become a leading source of sugar supply. Adverse legislation would cripple it, as it would us. As we are such enormous consumers of manufactured articles we have additional claims upon the government for fair protection. We have $10,000,000 invested in machinery alone, and it is demanding con- stant renewal and increase, particularly as new methods supersede the old. We are enormous consumers of Pittsburgh coal. We do not complain of the tariff that excludes us from buying the cheaper foreign machinery, coal, dry goods, &c. We say let us encourage the produc- tion of these goods in the other States of the Union, they taking our produce, which they can’t produce themselves, and we taking theirs. But we do ask that should you conclude to diminish the present insuf- ficient protection on sugars, that you will open to us the foreign markets for those articles we consume, by reducing also the duties thereon. In the matter of the adjustment of the duties on sugar, we would state that the sugar-refining interest of the country, with its enormous capita], rare skill aud continuous work, so cheapens the cost of pro- ducing the better grades of sugar, that we get no protection except what we get on the low grades, and, therefore, we ask that the mini- mum duties be not reduced. In the matter of classing sugars for the levying of duties thereon, it is an undisputed fact admitted by all of those who import, refine, or sell sugars, that all sugars imported for refining , are, without exception, JOHN DYMOND.l SUGAR CULTURE. 55 i bought and sold on their polariscope test as the chief means of deter mining their value. The matter of color in low grades under the pres- ent system of sugar manufacture is of but little importance as a test of the value of sugar. Again, all sugars sold for consumption, whether refined or plantation sugars, are invariably sold on their color. Thus two general methods of determining values are now resorted to, the one for sugars to be refined, the other for sugars going into consump- tion. As at present practically no sugars below No. 13, Dutch standard in color, go into direct consumption, we would respectfully suggest that in classing sugars, for the levying of duties thereon, you class all sugars not above No. 13, Dutch standard in color, by the polariscope, with re- gard to the percentage of cane sugar they contain, and that you class all sugars above No. 13, Dutch standard in color, by the Dutch standard of color. Aside from the universal commercial use of the polariscope in this country, it is the means adopted by the French Government for deter- mining the duties or taxes on sugar there. It is used throughout Europe in determining the condition and value of beet juice while tbe beets are growing and at every process in their subsequent manufac- ture. It is now largely used in Louisiana for the same purposes, i. e ., to determine the condition of sugar cane, and the condition and value of cane juice at each stage of its manufacture into sugar and to deter- mine the condition of sugar cane in respect to its value for preserva- tion for seed. The use of the polariscope in the sugar industry is now universal in all civilized countries, and is universally recognized as the best commercial test of the intrinsic value of sugars. By Commissioner Boteler : Question. Are you a practical sugar planter “l — Answer. Yes, sir; I am. Q. How many years have you been engaged in that business'? — A. Fourteen years. By Commissioner Oliver : Q. What are your reasons for recommending the adoption of two methods of classifying sugars, dividing at No. 13 ? — A. For the reason that all sugars that are imported for refining are imported based on their intrinsic merit, which is determinable only by the polariscope; whereas, all sugars imported to go directly into consumption, or that are produced here to go directly into consumption, are sold to consum ers based upon their color. Therefore, commercially, there are two methods of determining the value of sugars. When they are above No. 13 the usual method is to judge of them by color; and, when below No. 13, the almost exclusive method, in fact you may say the only method, is to determine their value by the polariscope. Q. Then you suggest that the raw, cheap, dark-colored sugars should be tested by the polariscope, and the sugars of commerce — the lighter-colored sugars — should be tested by the eye; by comparison? — A. Some of these sugars imported for refinement are not necessarily raw or cheap. They are too dark to enter into direct consumption, and yet have a high degree of purity. Q. What I mean by raw sugar is, the cheap grades of sugars. — A. As near as the taste of consumers can be determined, sugars under No. 13, Dutch standard, are not taken by them as a rule; therefore those would be the sugars proper to determine as they are determined in the trade. When sugars are above that in color, then they are taken by consumers; 552 TARIFF COMMISSION. [JOHN DYMOXD. such of those goods as are imported go into consumption direct. Their actual value then rests upon their color. By the President : Q. How would you answer the objection which has been made (I ask this for information, although you have partially referred to it ) to sugar culture, that the climate of Louisiana being only a semi-tropical climate, it is an unnatural product or culture, the natural culture of sugar being in a purely tropical country ? — A. I would state that all the facts are just the reverse; the assertion is inaccurate. The culture of sugar-cane in Louisiana has demonstrated the capacity of our soil and climate lor it. The sugar crops are large and almost universally certain, so far as quantity is concerned. It is one of the most certain crops in the Union. But the land there being so peculiarly adapted to sugar culture, other crops are not largely cultivated, and, therefore, when disaster comes, it is widespread in its character. In the West, if the corn crop fails there may be other crops which will counterbalance the loss of the corn crop. There is a diversity of agriculture in the West; whereas, in Lou- isiana, we have an exclusive agriculture. But we hold that our sugar crop is as certain as any one of these Western crops. Q. In other words, you say there is a natural adaptation of the soil to sugar culture in your State ? — A. Yes, sir. Q. It has been asserted by American political economists that the most profitable commerce is not on isothermal lines where there is a com- petition of industries, but across the latitudes where there is a difference in the character of natural products ; how does your industry illustrate that theory ? — A. I think it illustrates it specifically. We produce in our Southern States those articles which are not produced in the lati- tudes north of us, and we take from those latitudes what they produce, their wheat, corn, potatoes, and every merchantable variety of agricul- tural produce, and every kind of manufacture, and we return them sugar and molasses, which they cannot produce and do not produce, though they may in the future from sorghum. By Commissioner Boteler : Q, Sugar-cane being a tropical plant, and having become acclimated in Louisiana, has it not become hardier there than in its native coun- try ? — A. Yes, sir. We find that tropical canes that are brought in do not endure the climate as our old canes do, because the old canes have become acclimated. A large quantity of sugar is produced in Europe, and the difficulties of the culture there, on account of the vicissitu les of the climate, are incomparably greater than ours in Louisiana. Yet they are making a financial success in its culture. By Commissioner Underwood : Q. I would like to ask you a question in regard to the rate of duty. What average rate of duty upon sugar would bring the sugar planter in Louisiana upon an equal plane with the sugar planter in Cuba and other tropical regions? — A. I have investigated the matter with a good deal of care, and it is my opinion that it would take about 3| cents a pound, so far as labor is concerned, to put us on a plane with foreign labor. We are now getting 2J to 2j| cents a pound protection, and that is one reason why our industry has not been developed more rapidly than it has. The point which we desire to urge particularly is, that our present protection is insufficient, and we remonstrate ear- nestly against any reduction of the duty. Q. So I understand ; but it will be our province to recommend a rate JOHN PYMON'P.J SUGAR CULTURE. 553 of duty, and I want to know precisely what specific duty, in your judg- ment, would bring the sugar planter of Louisiana up to the same plane with the sugar planter of Cuba and other tropical regions ? — A. 1 think about 3^ cents a pound. By Commissioner McMahon: Q. Do you mean by that 3^ cents a pound on every pound of crys- tallizable sugar up to and including No. 13? — A. I mean 3| cents a pound, taking the average. Q. You advocate, as I understand, a polariscope test up to and in- cluding No. 13, but not above No. 13. Above No. 13 you suggest the Dutch standard of color test ? — A. Yes, sir. Q. What would be the several rates on that basis of 3J cents a pound ? — A. That is a matter I have not yet investigated, from the fact that we have not considered in Louisiana that we were very seriously interested in it. We are chiefly interested in the average duty collected, the sugar refiners, of course, demanding, on their part, as against the bounty-paid sugars of Europe, a protection to their own industry. We are protected by whatever the average rate of duty is. Q. You suggest two bases of placing duty; that involves, of course, two rates of duty. — A. Yes, sir. By Commissioner Kenner : Q. I would like to ask a question or two to amplify the questions asked by the president of the Commission, as to the effect of the ac- climation of cane. I ask you if we are not introducing every day (and whether you yourself are not introducing) different canes from dif- ferent climates in order to get a cane which is hardier, and which will stand our climate better? — A. Yes, sir; I am at present experimenting with twenty-five varieties of cane. I have one variety that was brought from Japan, which came through the Department of Agriculture a few years ago, and which is said to have the rare merit of being able to re- sist the frost. As to its capacity as a sugar-yielding cane, compared with other canes, 1 am not yet advised, not having experimented with it sufficiently. But in regard to the canes that I planted in the begin- ning of my experiments, and which have acquired a certain growth, I find that during the last three years, under the most adverse conditions, they have stood the climate remarkably well. I am now cultivating some of them. The ribbon caue we have is much better than that in- troduced through the Agricultural Department; it has become accli- mated and is the favorite cane in the South. We have also this ordi- nary red cane, or red bourbon cane, which stands all sorts of weather very well. Q. In speaking of the ribbon cane you say it has become acclimated; do you mean by that, its ability to resist frost has been increased? — A. Yes, sir. Q. if the sugar culture continues long enough, with the experiments being made with newly imported cane, do you or not think we shall eventually get, either by acclimation or importation, a cane that will resist effectually all our frosts, or the ordinary frosts which we get in Louisiana? — A. I believe that we shall eventually have such canes; in fact 1 think we have them now. But there are other canes that we hear of, which ripen within a comparatively short time, — say eight or nine months. If we could get a good cane of that kind, it would be still bet- ter. But independent of that, with just such canes as we have now, our crop is more certain than any one agricultural crop in America in any State where they have the same climatic vicissitudes. 554 TARIFF COMMISSION. [JOHN DYMONP. By Commissioner Oliver : Q. Have you any personal knowledge, or can you give any informa- tion, in regard to this corn sugar or grape sugar — glucose, as it is called? — A. I have some familiarity with it; I have seen it frequently. Q. Do you know whether the competition of that corn sugar, or grape sugar, is felt yet by the Louisiana sugar growers, or whether its growth is extending ? — A. The production of corn sugar is quite extensive, and seems to be increasing. It appears to me to be a legitimate product from corn, and has much legitimate use in the manufacture of candy, and in the manufacture of fruit aud all other sirups. We regard it as an allied industry and a meritorious one, in so far as its produce reaches a legitimate use, and the reverse of that to whatever extent its pro- duce is used illegitimately. But its legitimate use has largely increased. Q. What would you consider the illegitimate use of it ? — A. Its Isale as cane sugar, when it is not cane sugar. FBANK HAY.] APPRAISER S DEPARTMENT, N. Y. 555 FRANK HAY. Lonh Branch, N. J., August 18, 1882. Mr. Frank Hay, an examiner in the appraiser’s department of the New York custom-house, in response to the invitation of the Commis- sion, made the following statement: I beg to submit for your consideration a memorandum showing groups representing the different grades of raw sugars imported into this coun- try, arranged with the view of enabling you to determine what rate of duty paid upon each grade would be equitable to the government, the importer, and the refiner, whose large interests have been built up under the present tariff. The figures in brackets, indicating the rates of duty, have no signifi- cance, except to show the relative proportional differences which, in my judgment, should be observed in framing a new tariff'. Whether the government require twenty, thirty, or forty millions of dollars per year to be collected from raw sugars imported, the percent- age of differences, as shown in the memoranda attached, commencing with the lowest grade of raw sugar, at 1 cent per pound, and ending with sugar above No. 20 Dutch standard, at 3J cents per pound, should be observed. On all melada, concentrated melada, syrup of sugar-cane juice, con- centrated molasses, tank bottoms, and all sugar not above No. 13 Dutch standard in color, and which contains not over 80 per cent, of crystal- lizable sugar [1 cent] per pound. On all sugar not above No. 13 Dutch standard in color, and which contains over 80 and not over 84 per cent, of crystallizable sugar 1 * 1 * cents] per pound ; [1-^ cents] per pound over 84° and not over 88° • cents] per pound over 88° and not over 92°; [l-^ cents] per pound over 92° and not over 96° ; [2 cents] per pound over 9(3° and nor over 100°. Sugar above No. 13 and not above No. 16 Dutch standard [2 cents] per pound. Sugar above No. 16 and not above No. 20 Dutch standard, per pound [3 cents.] Sugar above No. 20, per pound [3J cents.] All sugar candy and confectionery, [50] per cent, ad valorem. Test 80° to 84°: Embraces the low grades East India and South Amer- ican sugars. Test 84° to 88° : Low grades of muscovado sugar and corresponding grades of East India and South American, &c. Test 88° to 92°: The best grades of muscovado and corresponding grades of sugar. Test 92° to 96° : Centrifugals. Test 96° to 99° : Higher grades of centrifugals. SAMPLES. A. — East India and low-grade South American sugars. B. — Good grade of South American sugars. C. — Low and high grade molasses sugars. D. — High-grade molasses sugars. 556 TARIFF COMMISSION. [FRANK HAY. E.— Muscovado sugars, low grade. E. — Muscovado sugars, high grade. G. — Centrifugals, low grade. H. — Centrifugals, high grade. These grades cover nine-tenths of the sugar imported in its raw state. A low grade of East India sugar, for instance, or South American sugar, rating at perhaps 7 or 8 Dutch standard, would come probably within that test of 80° to 84°. The higher grades would come within the 84° to 88° test. Then we come to the best grades, the muscovado sugars, which will range from 88° to 92°; and the lower colors of centrifugal sugar, the very best sugar that is made, unrefined, will come within the 92° to 99° test. The better class of centrifugal, testing from 90° to 98°, will run from No. 9 to 12. We scarcely ever get much sugar above No. 13 ; the amount imported is small. This is a condensed statement of the facts which I propose to submit, as representing our views as to what we regard as equitable, if any change is made in the tarifi*. I might state that under the present tariff all grades of centrifugal sugars pay a less rate of duty than muscovado sugars on the same color. They are made of a high test and low color. They have been manipulating these sugars for years, more particularly since 1875, when the 25 per cent, was put on, and it makes the duty from 15 to 39 per cent. less. That is the very point that Secretary Sher- man tried to correct when he applied a test which was not regarded by the courts as a legal test. By Commissioner Bqteler : Question. I would like to know whether the Dutch have or have not abandoned the test called the Dutch standard of color ! — Answer. I think they have, to a great extent. Q. Not entirely! — A. No, sir. They prepare this Dutch standard for use by other countries, and I judge they use the same standard to some extent themselves. I know that nearly every merchant in New York is provided with a set of the Dutch standards, and it is an ele- ment of value with them. Take a centrifugal sugar, we will say, that in color is No. 7. If it is above No. 7 and not above No. 10, it pays 2 cents duty ; but if nearer No. 10 than No. 7, the merchant or refiner will give more for it. He would take the test and the color both into ac- count when lie bought or sold it, and I think that is the practice all over the world now. But neither test would be conclusive. By Commissioner Oliver : Q. Where do you make the dividing line between the use of the polari- scope and the adopting of the color standard ! — A. At No, 13. Above No. 13 we would regard sugar as partly refined, and very little of it is impoited. Under the present tariff, if the sugar is above No. 10 and not above No. 13, it pays a duty of 2^ cents a pound. Above No. 13 and not above No. 16, it is raised a quarter of a cent. Q. In making your suggestions in regard to the rates of duty, you recommend the classifications of which you have spoken ! — A. Yes, sir. Q. i i ow do you arrive at that recommendation in regard to the figures you have stated here! — A. I base them on the present tarifi' as being equitable in that respect. By Commissioner Kenner: Q. I understand that you use these figures of value merely as an illustration t — A. Acs; I do not base the figures on the actual value of the sugars at all. FRANK HAY.] appraiser’s department, n. y. 557 By Commissioner McMahon : Q. I understood that you were only giving an example of the percent- age you recommend? — A. Yes, sir; I am not assuming to advise any special rate of duty. By Commissioner Oliver : Q. You suggest this as a form of classification ? — A. Yes, sir ; and the difference that is to be observed between different grades, so that the higher grades shall pay proportionately more duty than the lower grades ; that is, when you get above No. 13. Q. How long have you been in the appraiser’s department of the custom-house? — A. Since 1871. By Commissioner Kenner : Q. You have said in your statement that the memoranda which you have submitted, showing the groups representing the different grades of raw sugars imported, are arranged with a view of enabling us to de- termine what rate of duty paid upon each grade would be equitable to the government, the importer, and the refiner? — A. Yes, sir. Q. In that enumeration you do not include the producer at all? — A. No, sir. Q. Did you leave that out purposely or accidentally ? — A. That was left out purposely, for the reason that I did not want to indicate in any way what protection the Louisiana planter should have, or what rates of duties should be imposed upon imported sugars. By Commissioner Oliver : Q. You recommend the use of the polariscope in sugars rating at No. 13 and under? — A. Yes, sir; I do. After the point of No. 13 is passed the tests do not vary much. They would come up pretty nearly to 100 in any event, no matter what the sugar was, particularly if it w r as cen- trifugal sugar, and those sugars should be relatively at a higher rate than the lower grades. Therefore they are left out of the estimate of tests. Q. The difficulties you have had heretofore have been in regard to the lower grades of sugar altogether ? — A. Yes, sir ; the great bulk of the sugar imported into this country is below No. 10 in color. Mr. A. G. Remsen, an examiner in the New York custom-house, who was present, said : Mr. Hay and myself together have prepared the memoranda of rates upon sugar which he has submitted to you. I con- cur in the views expressed by him. By Commissioner McMahon: Question. How long have you been an examiner of sugar in the cus- tom-house? — Answer. About nine years. Q. Have you anything to add to what Mr. Hay has stated in regard to this subject? — A. No, sir; I have not. We consulted with each other before coming here, and he has stated everything that is neces- sary, in my opinion, for the Commission to know which will enable it to come to a proper determination upon the subject. By Commissioner Oliver : Q. You join with Mr. Hay in the recommendations he has made to us ? — A. Yes, sir. 558 TARIFF COMMISSION. [IMANUEL AUERBACH. IMANUEL AUERBACH. Long Branch, N. J., August 18, 1882. Mr. Imanuel Auerbach, assistant appraiser in the New York cus- tom house, upon the invitation of the Commission made the following statement : I have charge of the division relating to paintings, books and all kinds of printed matter, jewelry, diamonds, fancy goods, musical instruments, scientific instruments, and toys. As a matter concerning all divisions of the appraiser’s department, I would call your attention to the ques- tion of charges, which, if a certain nature, form a part of the dutiable value of merchandise. The law provides that such charges must be added to the market price of any merchandise in determining the dutiable value thereof. (Section 2907 of the Revised Statutes.) This section of the law causes many annoyances, and is, at the same time, not produc- tive of large revenue, while it works injustice, inasmuch as additions for certain charges (for freight, coverings, &c.), must be omitted in case the invoice reads, free on board and free of charges for packages. We experience a great difficulty in the matter of determining the charges to be added in making up the dutiable value of goods. I re- member one case where an invoice of Japanese goods could not be liqui- dated for some months because it was impossible to determine a ques- tion in regard to an insurance item on the invoice — whether it meant marine insurance or fire insurance. I take the ground that land insurance or fire insurance, can, under no circumstance, be counted as an element in the determination of the dutiable value of merchandise, as insurance does not enhance the value of the goods, it being only a step taken by the holder of the goods to secure himself against loss in case of destruction by fire or water. Such questions come up from the naval office and the collector’s office frequently, and cause trouble and delay, and I-think all these matters should be prevented by excluding the charges as a part of the dutiable elements of the goods. If this was done it would greatly facilitate the work of clearing invoices. There is another point I would like to call attention to, and that is in regard to the provisions of the act of 1875 regarding silks. I would suggest that the rate of 60 per cent, duty should be made apply to silk fabrics by themselves, and textile fabrics by themselves. I make this suggestion because of the embarrassments we have at all times in regard to miscellaneous goods in our liue otherwise provided for. For instance, fancy goods, dolls, toys, and fans are composed of various materials, and we have difficulty in finding out the proportionate value of silks and other materials which enter into their composition. I believe that if an article is sufficiently provided for in the law it should pay the duty pro- vided for that article without regard to the materials of which it is com- posed. A silk duty, for instance, on a fan is an absurdity. I suppose the act of 1875 was at first con tem [dated to cover textile fabrics, not fancy goods, or dolls, or toys, or anything of that kind, and the appli- cation of that act to such goods seems to me highly improper. Regardingprinted matter — books, pamphlets, periodicals, &c. — I would like to suggest an equalization of the treatment of certain articles with- out regard to the mode of their carriage. The universal postal treaty has prescribed, and it is a law in force at the present time, that books IMANUEL AUERBACH.] 559 appraiser’s department, n. y. without stiff covers, periodicals, magazines, newspapers, and pamphlets shall be admitted freeof duty. Now, the identical same goods, if brought in as a shipment of merchandise on board of a vessel as freight, go to the public stores and are charged at the rate of 25 per cent. There is no consistency in treating the very same article as dutiable in the one case and in the other case as not dutiable. Therefore, I would recom- mend with great earnestness the abolishing of all duties on newspapers, no matter in what way they come into port, and on all periodicals and such books as are provided for in the universal postal treaty. In order to simplify the tariff and bring a variety of articles under a few heads, I would recommend, as a single instance, that dolls and toys should be placed under one head. Dolls at present pay 35 per cent, duty while toys pay fifty per cent., although dolls are toys and are used as playthings for children. I do not see any necessity for a separate provision for dolls, and think it only tends to complicate the tariff laws. Either bring the duty on toys down to 35 per cent, or raise the duty on dolls to 50 per cent. There is really no difference in the two articles. By the President : Question. Are there many manufacturers of toys in this country ? — Answer. There are very few, and dolls are mostly imported. Fifteen- sixteenths of all the dolls and toys in use in this country are imported. I would like to call the attention of the Commission to the provisions of the Revised Statutes in regard to statuary under Schedule M. The law says that paintings and statuary, not otherwise provided for, shall pay 10 per centum ad valorem, but the term statuary shall be understood to include professional productions of a sculptor only. In the ap- plication of this provision of the law there was such a discrepancy for a number of years that the officers of the government, at the present time, are almost in the dark in regard to what they shall do in certain cases. The department has seen fit to define the word u statuary” as the original works of a professional sculptor, and under that ruling we have to decline to admit any statuary, no matter if made by the most re- nowned sculptor, if it is not his original work, and copies are classified as marble at a rate of duty of 50 per cent., or, if alabaster, of 30 per cent., &c. Now, there seems to be no good ground for such a decision. If a sculptor who is certified by a United States consul, or by some other good authority, as a professional artist, makes a copy of any of his works, I think it is just as much a work of art as the first was, and I do not think there is any fairness in the exclusion of the copies. There is one provision in the tariff, paragraph No. 1286, providing for glass plates or disks, uu wrought, for optical instruments, at the rate of 10 per centum ad valorem, while the majority of all articles of glass pay a duty of 40 per cent. There is a case now pending before the de- partment in which the question as to whether glass intended for spec- tacles, which are in one sense optical instruments, if it comes in the shape of unwrought glass, shall pay duty at the rate of 10 per cent. This matter will soon be decided by the department. But in the mean- time, of course, the importers are annoyed by not knowing where they stand, and the officers of the customs are also annoyed. I would sug- gest a change in that provision so as to make it read, “ Glass plates or disks, unwrought, for all optical purposes,” which would cover the case in point. That would bring in unwrought spectacle glasses under that provision. 1 would like to say a word in regard to antiquities, although that is a matter which the expert in our division, Mr. Stevens, will explain TARIFF COMMISSION. [1MANUEL AUERBACH. 5G0 more fully to you. The law provides that collections of antiquities shall he admitted free of duty. The Treasury Department has found no boundary line in the law to define what antiquities are, so that a more or less arbitrary decision as to what should be treated as antiquities must he made. The department has decided, although the trade is prejudiced against it, that antiquities are works which originated before the fifteenth century, so that any articles of antiquity, and artistic arti- cles of a later period, are excluded, if not originated prior to that date. It is claimed by experts in the business that an article originated one or two hundred years ago is just as much antiquity as one which origi- nated before the fifteenth century. The contrary ruling of the depart- ment being somewhat arbitrary, the law should be made so clear that there will be no necessity for an arbitrary decision in the future. The law should state what age the article should attain in order to entitle it to classification as an antiquity. Q. Supposing the line should be placed so as to include all articles made prior to the commencement of the present century? — A. I think it would be well for articles of the eighteenth century. Articles pro- duced before the eighteenth century are seldom articles of ordinary trade or commerce. They are usually bought by lovers of antiquities for their historical value, and not so much as merchandise. In some respects they are educators of the public taste, and therefore 1 do not think that they should be taxed. I do not think the Treasury would suffer much if goods of this class were admitted free of duty. BENJAMIN J. LEVY. ] appraiser’s department, n. y. 561 BENJAMIN J. LEVY. Longi Branch, N. J., August 19, 1882. Mr. Benjamin J. Levy, examiner, eighth division appraiser’s depart- ment, New York, in response to the invitation of the Commission, made the following statement: I think the most important suggestions I can make to the Commission in regard to the tariff will be those tending to do away with its incon- gruities and inconsistencies. I have tried to simplify the work in my department as much as possible, and to avoid the unnecessary delays and consequent dissatisfaction now existing among importers. I think it is of the highest importance to endeavor to simplify the arrangement of the tariff* so that duties may be assessed which will be satisfactory to the importer and just to the government. My particular branch is that of leather and glass. By Commissioner Porter : Q. How long a time have you been in the custom-house % — A. I have been there over twelve years. I have prepared a few suggestions in regard to the duties on leather and glass which I will submit for the consideration of the Commission, as follows: LEATHER. If the duty on leather could be assessed by weight it would simplify the tariff* very materially, but if not by weight, I would suggest arrang- ing the same in four classes, viz : 1st. All raw material, whether dried, wet, salted, or pickled hides or skins, “free.” 2d. Skins tanned but unfinished, also bend, belting, sole leather, wal- rus or other tanned hides, and all skins partially finished, so much per cent, (all one rate). 3d. Dressed and finished skins of all kinds so much per cent, (all one rate). 4th. Manufactures of leather, so much per cent, (all one rate). All pieces or scraps of leather and skins, whether new or old, should be free. Boots and shoes, whether any part is composed of wool or worsted, if the leather is the chief value, should be rated as a manufacture of leather. In section 2504, Schedule M (1319), the word “ morocco” should be omitted. The last clause, viz (1321), should be omitted entirely. GLASS. Schedule B, earth and earthenware (950). All cast glass not polished nor silvered, whether fluted, rolled, rough or ribbed, should pay an ad valorem duty, being the cheapest and commonest kind of glass made, almost a uniform price, by all manufacturers, the value easily ascer- tained, the duties easily assessed, and all would pay the same rate duty here and elsewhere. No weighing, no measurement required. This character of glass is imported in large sheets, and should an ad valorem H. Mis. 6 3G 562 TARIFF COMMISSION. [BENJAMIN J. LEVY. duty be not considered, then one rate of duty per pound for all thick- nesses. This character of glass as at present assessed requires weighing, measuring, and unnecessary detail which the above suggestions would avoid without any detriment to the revenue. 1st. (948). All unpolished cylinder, . crown, and common window- glass, whether white, colored, enameled, ground, fluted or corrugated, and whether flat or bent, the duties to be assessed, viz, three brackets. A. Single thick . — On all sizes not exceeding 40 united inches (16 by 24) a stated price per box on what is commercially known as a 50-foot box, and twice as much on what is commercially known as a 100-foot box. 2d. On all sizes exceeding 40 united inches and not over 80 united inches (50 by 30), a stated price per box on what is commercially known as a 50-foot box, and twice as much on what is commercially known as a 100-foot box. 3d. On all sizes above 80 united inches a stated price per box on what is commercially known as a 50-foot box, and twice as much on what is commercially known as a 100-foot box. B. 1J single. — Thick, commonly called one-half double, same division of brackets as above, the duty to be one-half more than single thick. These brackets would make a more equal division the way the sizes are now made. The duty should be per box and not per pound, as that is the way glass is bought and sold. Over 2,000 different sizes are made, few of which make exactly 50 or 100 square feet, but a number of lights are put in the boxes according to the size, which approximate as near as possible to that number of square feet, some more, some are less than 50 or 100 square feet ; the purchase and sale are the same, however, whether un- der or over the exact number of square feet. As an example, to show how unequal the present assessment of duties works, take a box of 50 square feet, say 36 by 50, and a box 36 by 54 ; each contains four lights (both bought and sold at the same price, whether on foreign or domestic price list) ; the one is assessed on exactly on 50 square feet, the other on 54 square feet. The glass as now assessed is weighed, and as it differs in weight from 49 to 55 pounds for 50 square feet for single thick and half as much more for half double, a second or extra duty is assessed on all weighing over 50 pounds for 50 square feet, and a third or extra duty is assessed on all glass containing more than 50 square feet, which varies from 40 to 60 square feet per box according to size of lights. The amount of labor required in measuring, counting, and weighing, the risk in handling, the breakage incurred, the destruction of the orig- inal package, which affects the sale of the package opened, the extra excess of duties now imposed, viz, from 7 to 10 per cent, in addition to the original duty assessed, because the box has over 50 square feet, or because the box weighs more than 50 pounds, although the importer pays nor receives no more for his box, the trouble in liquidating, the work imposed on those capable of liquidating these invoices, the time it takes, the delay, which is months and months before the same is liquidated and the importer called upon to pay the excess ascertained, requires but little foresight to see that the duties can be properly as- sessed by adopting the suggestions I have made. The government would be protected and justice done the importer. The duties would be as- sessed the same at all the ports, and all assessed alike, which is not done at present. Each box of single thick should be branded single thick, and each box of one-half double glass be branded double thick. BENJAMIN J. LEVY. ] appraiser’s department, n. y. 563 449. Polished cylinder and crown glass. 1st. On all plates not exceeding 3 square feet, the duty to be so much per square foot. 2d. On all plates exceeding 3 square feet, and not exceeding 5 square feet, the duty to be per square foot. 3d. On all plates exceeding 5 square feet, the duty to be per square foot. This glass is limited in size on account of being thin, and the above suggestions would be more simple and correspond more to the cost. 951. Cast polished plate glass unsilvered, whether flat or bent or beveled. 1st. On all plates not exceeding 2 square feet, the duty to be — per square foot. 2d. On all plates over 2 square feet, and not over 5 square feet, the duty to be per square foot. 3d. On all plates over 5 square feet, and not over 10 square feet, the duty to be per square foot. 4th. On all plates over 10 square feet, the duty to be per square foot. 952. Silvered looking-glass plates, or cast polished plate glass silvered, whether plain or beveled. 1st. On all plates not exceeding 2 square feet, the duty to be per square foot. 2d. On all plates over 2 square feet, and not over 5 square feet, the duty to be per square foot. 3d. On all plates over 5 square feet, and not over 10 square feet, the duty to be per square foot. 4th. On all glass over 10 square feet, the duty to be per square foot. In lieu of the present mode of assessing damage on breakage of glass, a percentage should be allowed on each invoice, say from 2 to 3J per cent. Optical glass plates and disks unwrought, and glass for spectacles in the rough, should be 20 per cent. 564 TARIFF COMMISSION. J. L. MANY.] J. L. MANY. Long Branch, N". J., August 21, 1882. Mr. J. L. Many, of New York, a rice broker, appeared, and made the following statement : The proportion of producers to consumers of rice in this country is amazingly small; a few thousand of the one, to the many millions of the other. Now, I advocate no reduction or alteration in the duty on cleaned foreign rices, but I most emphatically do advocate absolute freedom from all duty on all foreign rices in the rough or paddy state, for the following reasons : First. Because it would be the greatest amount of good to the great- est number of people. Second. Because I do not believe it would injure the rice interest at the South, but would rather stimulate a larger production at a smaller price. A planter told me last summer that an average price of 3J cents per pound would be profitable. We have been paying an average price this year of to 7 cents per pound. Third. It would create a new industry, or rather largely increase an old one, which in England is one of the largest, the milling interest. A few figures will show its importance : Great Britain imported, in 1881, 407,877 tons of rice ; she exported to North America (Canada, United States, and Mexico), 12,898 tons; to the West Indies, 59,199 tons; and to South American ports, 14,375 tons. There is raised in the United States a total product of about 40,000 tons. By having no duty on rough rice we would be able to supply the West Indies, Mexico, Canada, and South America, because our process of milling is superior to the German and English. We get a larger percentage of whole rice from the rough, with a better color and style ; that is, from the same quality of rough rice we make a style of cleaned that would be bought in preference. It would give us direct cargoes from the Asiatic rice countries, thereby insuring for shippers of home manufactures cargoes back, the lack of which I be- lieve has been detrimental to the development of our export trade. A trade with South America and the West Indies of 70,000 tons per year would certainly support American lines of transportation to those coun- tries without the aid of subsidies. Fourth. It would most assuredly increase the production at the South. The facts prove it. Before the war the duty was from nothing to 1 cent per pound; and while I cannot speak from positive knowledge, still my impression is, the lower the duty the larger the production. At that time we exported thousands of tons of domestic rice, instead of import- ing the foreign. The average price was then about 4 cents per pound ; in exceptional years as low as 2 cents, and as high as 7 cents ; but grow- ers were fully satisfied with the average prices. We certainly can raise rice as cheap now as before 1860 ; we do cotton. Fifth. It would make cheap rice, which is equally desirable with cheap wheat and cheap corn. V. G. BLOEDE.] ANILINE DYES. 565 V. G. BLOEDE. Long Branch, N. J., August 21, 1882. The following communication, regarding duties on aniline dyes and coal-tar products, was received from Mr. V. G. Bloede, representing the American Aniline Works of Parkersburg, W. Va. : Gentlemen: Having found it impossible, during my recent hurried visit to New York, to accept your invitation to appear in person before your committee, I adopt this method of communicating my views upon some of the matters you now have under consideration. The firm of Bloede & Rathbone, of which I am a member, is engaged at this point in the manufacture of various chemicals, chiefly such as are used in the dyeing and printing of yarns and textile fabrics. Our firm is also largely interested in the business known as the American Aniline Works, and it is particularly in this line of manufacture that I feel competent to communicate important information to your committee. The production of aniline colors from our native crude materials is a business the benefits of which seem to me to belong most legitimately to this country, and forms a fitter subject for heavy, even prohibitory, duty than many other branches of trade dej)ending exclusively upon imported crude material. Strange to say, although we have all of the chief crude materials in this country, it is only within the last two or three years that the production of colors exclusively from our native products has been attempted. Prior to this time a few small works had been engaged in the manufacture of a few simple coal-tar dyes, but they worked exclusively with a crude material, combined and manipulated by European skill and imported into this country, duty free, in a half finished condition, i. c., in the form of arseniate o<£ aniline. To pro- duce this material, American benzoles and other coal-tar products are shipped abroad in a crude state at a heavy expense, manipulated by foreign skill and labor at another heavy expense, and returned to us still as a crude product, but largely enhanced in value. The entire profits of manipulating our own crude material have thus for years been lost to our country. I believe I am correct in stating that the American Aniline Works, which I have 'the pleasure of representing, was the first concern in the United States which suc- ceeded in producing on a large scale the base used in the manufacture of these colors, i. e ., aniline oil, from the crude coal-tar products of our own country, and exclusively by home labor. It is not necessary for me to dwell upon the almost insurmountable difficulties encountered in a new manufacture of this kind in a country totally devoid of skilled labor and experience. It generally means one of three things : first and generally, a total failure; second, the importation of skilled labor from the other side (a class of labor which seldom flourishes under the busi- ness conditions here existing), or, as the American Aniline Works have done, the redevelopment , as it were, of the entire process of manufacture by a long series of difficult and costly experiments. One thing that is retarding the utilization of our home products more than anything else is the fact that, by the grossly unjust and arbitrary provisions of some sections of our tariff, aniline oil, and the half finished product known as arseniate of aniline, have been hitherto admitted free of duty; a pro- 566 TARIFF COMMISSION. [V. G. BLOEDE. vision wholly and exclusively to the benefit of the foreign producers. The natural result has been that no American manufacturer could be found willing to devote his time and capital to the development of a branch of industry in which Europe has the advantage of twenty-five years’ experience. To insure the utilization of our own coal-tar pro- ducts under the best possible conditions for success, I would most ur- gently request that your Commission recommend a duty to be placed upon the two crude materials named, as well as any others that can be produced here, so as to insure to our country the benefits derived from the consumption of our own coal-tar products. In my opinion, had our tariff not been defective in this vital particular, and aniline oil and its compounds had early paid duty, the manufacture of the articles from our own crude coal-tar products would have been an assured fact years ago. I believe that our people are fully competent, not only to hold their own against the competition of other nations in any manufacture, but that they are their superiors in many essential particulars. At the same time it is absolutely necessary that a new enterprise of this kind, in order to compete successfully against the products of a quarter of a century of European research and experience, be liberally protected until our own manufacturers have acquired sufficient knowledge and experience to enable them to hold their own against these odds. I would therefore urge that aniline oil, arseniate of aniline, and other salts of the base be protected with a specific duty of from five to ten cents per pound. I would also urge that the duty on the intermediate products, such as nitro-benzole, and binitro-benzole, and its homo- logues, be maintained. The duty on nitro-benzole is now two cents per pound, while binitro-benzole, which is merely nitro-benzole combined with more acid, pays a duty of 20 per cent. I would recommend that the duty upon all nitro compounds of benzole and its homologues be made a uniform one of 10 cents per pound, as in the case of nitro-ben- zole. I have carefully examined some of the statements made before your Commission, and must say that some of those presented on behalf of the foreign manufacturers are certainly extraordinary misstatements of facts. Mr. John Campbell, for instance, appeared before your Commission, and, unless the press misrepresented him, made the remarkable and wholly erroneous statement that a color costing $1 per pound in England w 7 ould, under the present duties, cost $4 j)er pound laid down on this side This is such a very gross misstatement of the facts that I hesitate to believe it was seriously offered to your Commission. Such a color as Mr. Campbell speaks of, after payment of all duties, freights, and the like, would cost less than one-half that sum ; say $1.90 per pound. The result of home competition is already so strongly felt in some lines, for instance fuchsine and other reds, as almost to have stopped all impor- tation, and it is my opinion that within a short space of time these colors can be made as cheaply in the United States as in any country of Europe. This is the direct result of protection and the stimulation of home enter- prise, and there is no reason whatever why, within ten years, or even a much shorter period, if we are only able to avail ourselves, by means of a liberal protection of our domestic wealth in crude material, all other coal-tar colors should not be in the same position. Whatever course your committee may take as regards the older chemi- cal industries of this country, I would urge that the aniline branch be liberally protected at least for a few years. As before stated, it is an industry so new that up to two years ago not one pound of the base used in the manufacture of these colors was made in the United States. V. G. BLOEDF..] ANILINE DYES. 567 A great deal lias been said, and with much force, upon the nature of the duties imposed on aniline dyes, and the injustice resulting therefrom. A duty like the present one, of 50 cents per pound and 35 per cent, ad valorem, I believe to be wholly wrong. It annually deprives our gov- ernment of thousands of dollars of legitimate revenue, and entails an enormous and unnecessary expense in collection. Many of the manu- facturers on the other side have resident partners here, and it is the general impression that an enormous amount of color finds its way into this country under the ad valorem system at a very great undervaluation. That this system of collecting duties at least opens the way toagreat deal of fraud will be seen at a glance by your Commission, when I state that the various aniline blues, for instance, range in price from $2 to $15 and $20 per pound. The difference is not one of strength, but only of purity and quality of shade, some high-priced colors being actually weaker in point of strength than others of a low price. These colors are sold under ar- bitrary names and marks, such as B, BB, &c., up to 5 B or G B. Kow, suppose an unprincipled person wishes to undersell his competitor, all that he has to do is to mark his 5 B, or f> B, or other mark, worth, say, $12 per pound, down to B or BB, worth, say, $3; the result is the evasion on his part of 35 per cent, duty on $9 of each pound of this color, or the enormous sum of $3.15 on every pound. It is utterly impossible for the largest corps of experts the government can command to so test the samples as to make such frauds impossible. The interests of the gov- ernment, the consumer, and the honest dealer, require a change of this system to one of specific duty, or so much per pound of color. The aver- age value of the aniline dyes imported into this country we will say is $6 per pound. Under the present system, such a color would pay a duty of $2.60 per pound, and I would recommend that a uniform duty of from $1.50 to $2 per pound be imposed upon all aniline dyes of what- soever name or quality. While it is true that such duty would be pro- hibitory as regards the cheaper grades, the answer to this is, that such dyes can and are already produced in this country at a price to exclude, or almost exclude importation, even under the present system of duty. By adopting a specific duty a large expense would be saved the govern- ment in the collection of the duties, a larger revenue would result, the consumer would be largely benefited by the higher grade of the colors, and honesty on the part of the importer would be insured, as it would necessarily break up the system of undervaluation, or cost invoicing, adopted by many of the European manufacturers having resident part- ners on this side. Should an ad valorem duty be continued, I would urge your committee to move a Congressional investigation having for its object the breaking up of the systems now in vogue for the evasion of duty. Some efforts have been made to show that the present rate of duty on these dyes is very onerous to the consumer and the public ; such is not the case, however, for two reasons : first, because the branches of business consuming them are themselves protected by almost prohibi- tory duties, and, lastly and chiefly, because the quantity of dye used per pound of cloth or yarn is almost infinitesimal. Taking the ca^e of fuchsine, for instance, a color costing only $2 per pound, but four or five ounces are required for every 100 pounds of carpet-chain ; this means a tax through present duties of only 3 or 4 cents on an average size rag carpet. The fact is that while a removal of the duties would de- prive the government of a large revenue, and kill the home industry outright, no one class, except the foreign manufacturer, would be bene- fited. This was shown a few years ago in the case of artificial alizarine. 568 TARIFF COMMISSION. [V. G. BLOEDE. By the assistance of the consumers the duty was removed from this article, ever since which time the said consumers have to pay about again as much for the article as their foreign competitors, and the large revenue that would have resulted to our people by a duty was absorbed by the foreign manufacturers and their agents. It is therefore desir- able that neither the government nor the consumer be again inveigled into such action on behalf of a wholly foreign industry. Before closing I would call the attention of your committee to the fact that, owing to the vitality the American aniline manufacture is begin- ning to show in the last year or two, the foreign manufacturers of these dyes have combined for a concerted action, and are making extraor- dinary efforts looking to the repeal of the duties and the killing of this promising industry. Among other devices adopted, is the one of ob- taining signatures to petitions among the consumers of these dyes, ask- ing for a repeal of the duties. These petitions have been gotten up by the New York representatives of a large foreign corporation, and are be- ing extensively circulated for signatures. I state this so that when such petitions are presented, it will be understood that they are not the sen- timents of the American consumers of these dyes, who, as far as my knowledge enables me to speak, are universally in favor of and willing to pay their quota towards the successful introduction of this manufact- ure in the United States. The actual disposition of the largest con- sumers of the anilines is fairly represented by the following sentence in a letter recently received by me from one of these consumers: “The representatives of a large European aniline works are making a great push to have the duties on anilines reduced. I inclose you their circu- lar which they are sending to all the manufacturers to obtain signatures. What do you as a manufacturer think of it, and what would you pro- pose! We can stand it as it is, and, having all the protection we need on our manufactures, are willing to give all that is required to others.” I have the honor of remaining, very truly, yours, Y. G. BLOEDE. Parkersburg, W. Va., Aug. 10, 1882. ALFRED EARNSHAW.] IRON ORE. 569 i ALFRED EABESHAW. Long Branch, N. J., August 21, 1882. Mr. Alfred Earnshaw, of Philadelphia, an importer of iron ore, appeared before the Commission and made the following statement: In asking that foreign iron ore be put on the free list, I do not find any fault with the present duty of 20 per cent, ad valorem, as being in any way excessive or oppressive per se 1 but I claim that under existing circumstances any duty at all is a misapplication of the true principle of protection. Iron ore is not mentioned in the present tariff, but it comes in under one of the drag-net clauses, as a “ crude mineral substance not otherwise provided for,” at 20 per cent, ad valorem. Under no circumstances whatever should this present duty of 20 per cent, ad valorem be al- lowed to remain ; and if a duty be imposed at all it should be specific. The endless trouble and confusion that has been caused by this ques- tion of u free on board value” on the date of a vessel’s sailing from the other side has so thoroughly wearied the government employes and all importers that I can confidently say they will, one and all, join in re- questing that the duty be made specific. I desire to be understood as speaking of the importation of iron ore and manganiferous iron ore into this country from abroad without any reference to the consideration of a u tariff for revenue,” and as being myself a believer in true protection, and with an earnest desire to do all I can to have the iron and steel industries of this country thoroughly and intelligently protected. I ask that iron ore and manganiferous iron ore be admitted free of duty, as one means of protection to the iron and steel trades. The present duty on iron ore, although not averaging more than 50 cents per ton, is a very important factor in limiting the amount that is yearly brought here. The price of foreign iron ore in this country is mainly dependent upon the price of ocean freight, and that is directly influenced by the amount of tonnage required. There are a certain limited number of vessels available for bringing iron ore, which must either take it or come out here in ballast, and with these vessels a small quantity of iron ore can be brought here at a very low cost. If you exceed that quantity, you create competition, and raise the price of ocean freight, not only on the small excess but on the whole quantity. The more you increase the quantity the higher you raise the freight ; and there is a point beyond which the quantity cannot be in- creased, excepting by paying full ocean freights, which are simply pro- hibitory. The removal of this 2s. per ton (50 cents) average duty would not af- fect the price of foreign ore here at all. It would simply be swallowed up in increased ocean freight, on account of the increased quantity of tonnage that would be required. On the other hand, supposing the present duty on ore were doubled, so as to average $1 per ton, instead of 50 cents per ton, as it is now, it would not stop the whole business. It would simply take 2s. per ton 570 TARIFF COMMISSION. | ALFRED EARN8HAW. from the average freight that is now paid, and thus materially reduce the number of tons brought here. Let me state here that it is a common fallacy to believe that foreign ore is only brought to this country as ballast, without paying ocean freight. The average freight for 1880 was 12$., for 1881, 14$., and for this year I think it will be about the same. The effect of an importation of iron ore, double the present amount (twice 500,000 tons), would be a direct decrease of 250,000 tons in the importation of Bessemer pig iron, without taking into account the native ore used with the foreign as a mixture, and any decrease in the amount of ore imported will act directly to reciprocally increase the amount of pig iron imported for Bessemer purposes. If you stop the importation of foreign ores altogether, it will not in- crease directly by one iota the price of native ore ; and it will not cause the mining of one ton more ore in this country, simply because to-day every ton of good ore that can be mined here is being mined without any regard to foreign ore at all, but, as I show hereafter, it will render useless many thousand tons of native ore now used as a mixture in the furnace with foreign ores. The importation of foreign ore is merely an adjunct of the steel busi- ness, and must be so considered. It has nothing whatever to do with the general iron business of the country. It is the outcome of the enor- mous increase of the manufacture of steel in this country during the last five years, and it is coincident with, and has kept steady pace with, the increased importation of foreign pig iron for Bessemer purposes. America requires to-day, for yearly consumption in her steel mills, roughly speaking, 2,000,000 tons of pig iron, of which not less than one- fifth (400,000 tons) is, and must be, imported, unless you can increase the manufacture of Bessemer pig iron in this country. These 400,000 tons are imported chiefly from England, and are a part of her surplus manufacture, and these foreign 400,000 tons to-day abso- lutely control the price of the 1,600,000 tons of native steel pig iron. When I ask, therefore, that you place iron ore on the free list I only ask that you give the iron makers in this country the chance of driving out of our market the surplus production of England. England is chiefly dependent upon the Spanish and African ores for her supply of Bessemer pig iron ; and in the present state of the trade, to impose any duty on these ores here, is simply offering to England that amount of premium to keep many of her furnaces running while our furnaces here are legislated out of blast. The chief, and I believe only, objection to free importation of iron ore that you will hear made, is, that duty on these ores will act as an incentive to search for and discover new deposits of Bessemer ores in this country. This is a sentimental fallacy, and no foundation in truth whatever. There is not to-day in this country any industry that pays such enormous profits as the mining of good Bessemer ore deposits when in any reasonable quantity, and for confirmation of the state- ment I appeal to the share list, where the quotations of Lake Superior mines are shown, and where to-day can be seen twenty -five dollar shares quoted at $300, and also to the last transaction in these mines, where a company with a total capital of $100,000 sold a moiety of their possessions for $1,800,000 and asked $5,000,000 for the remainder. The search for Bessemer ore is being actively pressed, and it will be kept up. The various steel companies alone have, of my own knowl- edge, spent, during the last three years, over $1,000,000 in what has been chiefly fruitless search for available deposits of Bessemer ore. It ALFRED EARNBHAW. 1 IRON ORE. 571 would not stimulate the search in the slightest to have foreign ore ex- cluded from this country, unless you also exclude Bessemer pig iron ; because, as I have explained, foreign Bessemer pig iron governs the price of native pig iron, and through it governs the price of foreign ore, or, more correctly speaking, fixes a limit beyond which it cannot ad- vance. Stop this ore from coming, and you simply increase the impor- tation of foreign pig iron, and you do not aid or assist American ore in the slightest. To stop the importation of foreign ore, and leave for- eign pig iron alone, is like watching the spigot and letting the cask leak at the bung. You will be asked to believe that these statements of mine are not so, and the effect that high protection on wool, spool cotton, and the steel-rail trade itself, has had upon the development of those industries will be cited to you as proof to the contrary of my statement. The cases are not analogous. Man can control the production of wool, spool cotton, and steel rails, but man cannot control the phosphorus in iron ore, nor change the location of a deposit. Man, in this case, is helpless. He can, by legislation, prevent the importation of low phosphorous ores, but he cannot create an ounce of it. Foreign ore is imported here chiefly because it is so low in phospho- rus, and a large amount of native ore is now used as a mixture in the furnace, that without it it would not be available for Bessemer purposes at all. It is not because foreign ore is cheap that it is used, but because it is low in phosphorus. This is a point I cannot too strongly impress upon you. The mining of Bessemer ore in this country has wonderfully increased within the last few years, but it has not kept pace with the demand. The new discoveries of ores have almost altogether been in the West. East of the Alleghanies the discoveries have been small and isolated. The West is well supplied with ore, and does not require any legisla- tion to protect its interests. Inland freight alone is quite sufficient. The East has almost no Bessemer ore to depend upon, and it is here that foreign ore finds its chief market. The ground here in Pennsylvania and New Jersey has been so thoroughly searched that I do not think any premium could stimulate discovery to the point of finding a large deposit available for Bessemer wants. Our looks and inquiries have to be to the South, and we do not find Bessemer ore in quantity before we reach North Carolina. The haul- age is too great to allow of any ore being brought from there except in entirely exceptional cases. The remedy, I suppose, looks simple; put a high tariff on ore and then the Eastern furnaces can afford to pay for the very long haulage, and Southern ore will be used instead of foreign. This simple remedy, however, will not work, because the steel men nat- urally will buy their iron in the cheapest market, and if it pays them better to buy foreign pig, they will do it, and rather let their furnaces stand idle, and so give Southern ores the go-by. A better way of util- izing these Southern ores is to stimulate the production of Bessemer pig. The exact mode in which to most efficiently stimulate this indus- try in the South is a very open question, and I do not propose to enter upon it now. I will simply say that an increase in the duty on foreign ore will not do it, but that if a higher value of ore in this country is all that is re- quired this can be at once brought about by increasing the duty on pig iron. Let me, however, be distinctly understood as not advocating any ad- 572 TARIFF COMMISSION. f ALFRED EARNSHAW. vance in the duty on pig iron. I am merely stating wliat would be one of the effects of such an increase. There is splendid fuel, and not too far away from these good ores, and sooner or later, with higher duty or without, the pig iron must be made right there and then shipped to Pennsylvania. Pig iron will stand the heavy haulage, but ore will not. But you may ask, would not a higher duty on pig and free ore tend greatly to increase the importation of foreign ore? Certainly it would, but the increased importation would be at a considerably advanced price, on account of the increased ocean freight that would have to be paid. The matter balances so well that, practically, as I have already shown, foreign ore can have no influence on, and never has influenced, the price at all of either native pig iron or native ore. Every dollar of increased duty would be added directly to the price of pig iron, because foreign pig controls the price in this country. Furthermore, the furnace men would get none of it, because the poor and rapacious ore men would raise their prices to correspond, and so swallow the whole of it. The furnace men are to-day the slaves of the ore men, and so they must remain until the supply of good ore exceeds or equals the demand. I trust I have made my meaning plain and that I am reasonably in- telligible. What I have tried to show is — First. That a prohibitory duty on ore would not affect the price of native ore. Second. That the removal of all duty would not affect the price of native ore. Third. That a prohibitory duty on ore would materially increase the importation of Bessemer pig iron. Fourth. That free ore would decrease materially the importation of pig iron. Fifth. That an increased duty on pig iron would decrease the impor- tation of pig iron. Sixth. A higher duty on pig iron would stimulate the development of Southern ore beds and the erection of furnaces South. Seventh. The higher duty on pig iron would greatly increase the' price of ore; and I may go farther and say — Eighth. That the development of the Southern iron business on any large scale would jiermanently reduce the price of Bessemer pig iron and Bessemer ore in this country. Protection to native labor is secured in foreign ores by the ocean freight, say not less than $3 per ton, which it has to pay before it gets here, an amount certainly in excess of the ordinary expenses of mining Bessemer ore per ton in this country. I have drawn up a table showing the amount of protection that, in- cluding ocean freight, the present tariff offers to ore and pig iron. Ocean freight. Tariff. Total. Rfisspmfir iron nrft _ . Per cent. 150 Per cent. 20 Per cent. 170 Spiegeleisen ore 90 20 50 no 70 Bessemer pig iron 20 20 per cent. Spiegel 10 25 35 Of course, I am aware that some people who are interested will claim that ocean freight is not protection, that it is only a natural advantage, and that they have a right to protection as well. Protection for native ALFRED EARNSIIAW.J IRON ORE. 573 ore, when to-day the ore necessary for making a ton of pig iron is worth in Pittsburgh $4 more than a ton of the best Barrow pig free on board at Barrow; and $7 per ton duty, leaves, therefore, $3 per ton to cover the cost of fuel, labor, limestone, interest on capital, and profit? And where would the furnace owners be without the further protection of three dollars per ton ocean freight? It is this exceeding high price of ore that forces the cost at furnace of simple pig iron sufficient to make a ton of Bessemer steel rails, to a higher figure in Pittsburg to-day than the cost of a ton of English steel rails on wharf at New York, duty unpaid. You must remember that when iron began to be first an important industry in this country, it naturally located as near fuel as possible in the manufacturing States where its market existed, and where it had moderate facilities for transportation to that market. What is the con- sequence? Not ten per cent, of the furnaces in this country have both fuel and ore within reasonable distance. Some have fuel, and some have ore, but rare indeed are the furnaces that have them both. The average absolute cost of manufacture in America of common pig iron is $20, and in England it is $10. There are furnaces, however, in America that are, and have been for years, making pig iron at not over $13 per ton. It is perhaps needless to say that both fuel and mineral are quite handy in all these cases. American labor is not the chief element of cost in making pig iron that re- quires protection. It is against natural disadvantages that protection is required. Strong protection on pig iron is an absolute necessity , for with- out it nine- tenths of all American furnaces would be forced out of blast. Increase the duty so that it is prohibitory, and by the laws of natural trade the price will gradually fall, for home production will be felt, and a survival of the fittest will gradually and naturally follow. Lower the duty, and new enterprises would be discouraged, capital would take alarm and seek other channels for investment, the badly situated fur- naces would be immediately forced out of blast, and trade would languish, and the market be Hooded with foreign pig. Our workmen would be compelled to seek other trades, and in two or three years the accrued benefits of years of wise legislation would be dissipated and dispersed to the winds. Apart from this question of iron ore is the importation of manganifer- ous iron ore, used in the manufacture of Spiegeleisen, an article of abso- lute necessity in the manufacture of Bessemer steel. There are no known deposits of suitable ore in quantity in this country, and the exceedingly small quantity of Spiegel now manufactured here is smelted chiefly from foreign ores. No harm can possibly be done to anybody, and by remov- ing the duty the manufacture may at least have some encouragement to transfer itself from Europe to this country. The importation of Spiegeleisen amounts to about 150,000 tons per annum. Finally, I would ask you to remember that the importation of foreign ore is a trade that brings large numbers of ships to our shores, and that it decreases the rate of freight at which these ships can afford to carry grain to Europe. That it gives a large back freight to the railroad com- panies, and reduces the cost of their haulage on grain, &c., from the West to the seaboard. That it induces the use of large quantities of native ores as a mixture that could not otherwise be used, and that, being manufactured here into pig iron, it pays large wages to our work- men and consumes a large amount of our fuel. And, most important consideration of all, it prevents the importation of an equivalent amount 574 TARIFF COMMISSION. [ALFRED EARNSHAW. of foreign pig iron, and accomplishes all this without being injurious in the slightest to a single ore mine in America. By Commissioner Kenner: Question. Are you a manufacturer! — Answer. No, sir; I am inter- ested in native mines, but my business is chiefly the importation of iron ore. Q. Do you purchase the iron ore abroad and import it, or do you re- ceive it on consignment % — A. I purchase it abroad, and ship it here. Occasionally I receive some on consignment. By Commissioner Oliver: Q. When did the importation of European ores in large quantities begin! — A. In the second half of 1879, 1 think, it began to be a business. That is the time when the material increase in the business was first felt. Before that we did not import, I think, more than about 100,000 tons or 150,000 tons a year ; but in the latter part of 1879 the business was fully trebled. Q. What were the importations for 1879, 1880, and 1881 ! — A. In 1879 the importation amounted to about 300,000 tons; in 1880, 1 think it was nearly 500,000 tons; and in 1881, about 700,000 tons. This year the importation will probably be under 500,000 tons. Q. The importation in 1882 was reduced by the high freights, I sup- pose! — A. Yes; the freights have been almost prohibitory. Q. Where do these ores generally come from ! — A. Erom the Mediter- ranean, from the southern part of Spain, from the north of Africa, from the island of Elba, a small quantity from the north of Spain, and also some from England, the Cumberland red hematite, but only in very small quantities. Q. Are the deposits in those regions generally near the water ! — A. Y es ; most of them are on the coast line. They lie generally, 1 suppose, from two to a dozen miles back from the coast. Q. How do they average in yield of iron! — A. The leaner ores are not brought here. The ores that are imported average perhaps 53 or 54 per cent. Some of them, of course, are richer, and some leaner; they sometimes go below 50, and sometimes above 58 per cent. Q. About what has been the average rate for those ores “free on board”! — A. Of course, some are much more expensive than others; but the average rate would not exceed, I think, $2 a ton “ free on board.” Q. Is that about the rate upon which the duties have been assessed ! — A. That is about the average. Some ores, of course, are considerably cheaper, and some much higher. But take, for instance, the barrow pig, which is a fair criterion of the whole, the price of that iron to-day is not more than $1.50 or $1.75 “free on board.” Q. The 20 per cent, duty has averaged about how much during the last three years! — A. I think the exact average has been 56 cents. Q. The statement which you have made does not touch the point whether the importers of ore would prefer a specific duty of so much a ton. — A. I think I stated in the commencement of my paper that under no circumstances should the duty be anything but specific. Q. Have you generally had trouble in getting ores through the custom- house! — A. Yes; endless trouble. I think I have between twenty and thirty suits with the government now pending on the question of valua- tion. The law requires the importer to state the value in the market ot the particular country on the day of the ship’s sailing. If the ore comes in a sailing vessel, that day maybe two or three months back, and, deal- ing with an article that is so cheap that almost any advauce at all may ALFRED EARN8HAW.] IRON ORE. 575 be more than 10 per cent., and where such an advance carries a penalty, it is almost impossible for two men to sit down and agree upon an exact price for the article on any particular day. Of course, the government officers want to get as much duty as they can out of it, and we want to get as near the real price as we can, and the whole question becomes wearisome and burdensome to the last degree. Q. I suppose your importations have been principally at the three great ports? — A. Yes. Baltimore leads, New York is second, and Phila- delphia next. Q. Has there been uniformity in the appraisement at the different ports? — A. No. I have had no difficulty at all in Philadelphia or Balti- more. All my trouble has been in New York. Q. Does much ore come in from Canada? — A. I think the statistics show about 50,000 tons last year imported from Canada, and that amount will gradually increase. Q. You have not imported any from that region? — A. No; that is out of my line. Q. Are all the ores that have been imported what are called Besse- mer ores; are they low enough in phosphorus to be so classed? — A. You may say they are. There has been an infinitesimal percentage of other ores; but most of the importations have been of Bessemer ore. Q. Are the mines from which the deposits now being imported are obtained, mainly new mines? — A. Oh, no. They are deposits from which England has drawn for the last fifteen or twenty years. Of course, new deposits are being discovered all the time; but there have been mines in the same districts for years and years. By the President : Q. That Elba mine is of great antiquity, is it not? — A. Yes, the Elba mines were undoubtedly worked by the Bomans. By Commissioner Oliver : Q. Labor must be very cheap and the facilities very good to enable those people to put ores on board vessels for $1.75. — A. No, not necessa- rily, when you come to consider the matter in detail. In the first place, the government owns the mineral; the possessor of the land does not. The government owns the mineral, and fixes a tax of about 3 cents a ton, which is all the royalty there is to pay. Therefore this $1.75 or $2 a ton represents nearly all labor, because the mineral has cost little or nothing. Now, there is hardly a mine in America where ore cannot be handled at $2 a ton. The miners in the Lake region can handle it at that rate. By Commissioner Ambler : Q. Are they able to put ores “free on board” at Marquette at $2 a ton ? — A. Yes. They will tell you that they are not, but if they will produce their cost-sheets you will see that it costs them less. If that were not so, they would not be able to pay such dividends as they do pay, and $25 shares would not be worth $300. 576 TARIFF COMMISSION. [THOMAS MACKELLAR. THOMAS MacKELLAB, Long Branch, N. J., August 2 1, 1882. Mr. Thomas MacKellar, of Philadelphia, representing the type- founding industry, made the following statement: There are about thirty type foundries in the United States, represent- ing a production of some $2,000,000 a year. These foundries are in dif- ferent parts of the country — in the East, in the West, and in the North- west; but there are none farther south than Bichmond, the nature of the business being such that it requires a cooler climate than they have in the South. In 1796 the first type foundry in America was established in Philadelphia, and that establishment is in existence to-day. Until that time the printers of this country were wholly dependent on foreign type founders. Type, as you gentlemen are probably aware, is of many sizes, beginning with brilliant , which is so excessively small that it takes about 4,200 letters to weigh a pound, and gradually increasing in size up to the largest type. Nonpareil is a middle-size type, such as is used mostly in newspapers, and I will speak of it as representing type generally. In 1812 nonpareil type sold in London at $1.80 per pound. In the same year, in Philadelphia, the same type sold at $1.75 per pound, 5 cents less than the English price. In 1827 the price was down to $1.20; in 1866 it went down to 84 cents; and in 1882 the price is 58 cents a pound. This shoVs how much the printers of America are in- debted for cheap type to American type founders. Nevertheless, Con- gress at every session is beset with petitions for free type. Those petitions are nearly always gotten up in the interest of foreign type founders. One of the most outrageous instances of this kind was a petition gotten up by a foreigner in California. It was sent to editors all over the country, accompanied by envelopes already addressed, and copies of that petition were sent into Congress at the rate of 300 or 400 a day. The petition was a tissue of lies from beginning to end ; but many country printers, good, honest men, signed it, not knowing whether its statements were true or false. We have now a protection of 25 per cent, ad valorem duty on all foreign type. Type metal is a composition, made of lead, tin, antimony, and copper, in certain proportions. The lead pays a duty of 2 cents per pound, the copper a duty of 5 cents per pound; tin comes in free; but antimony pays a duty of 10 per cent, ad valorem. Brass is used quite extensively in connec- tion with our business, and the duty on it is 25 per cent, ad valorem; and on our iron castings there is a duty of 30 per cent, ad valorem. We are thus handicapped by a heavy tax upon the raw materials which enter into the composition of type, or into the composition of our ma- chines, and to offset all these disadvantages we have simply a duty 25 per cent, ad valorem upon foreign type. If the duties were removed from all our raw materials, so that we could meet the foreign manufact- urers on a fair footing, we would not fear their competition, although we pay 45 per cent, higher wages than are paid in England, and bring our tin and antimony from England; but if the present duty on our raw materials is to be continued, then we claim that the protection which we now enjoy ought to be continued. THOMAS MACKELLAB.] TYPE-FOUNDING. 577 In London, at the present time, the price of the type which we sell for 58 cents is two shillings and fourpence, about 56 cents ; so you can see that the American type founders are not oppressing the American printers very much. Yet, notwithstanding the facts I have stated, and notwithstanding this duty of 25 per cent, ad valorem, we find difficulty in keeping out English type. You may think this a strange statement, in view of the fact that we sell our type here at almost the same price at which the English founders sell theirs at home, but I will explain. To get up a font of type requires the employment of a punch cutter at very high wages, from $30 to $50 per week. He cuts each of the differ- ent letters on the end of a piece of steel, and the letters all have to harmonize in the lightness of the lines, in the heaviness of the lines, in height and breadth and all dimensions, so as to get a good effect in your print. The work has to be very exact. No watch making can compare with it j in fact, there is hardly any work that can compare with it in the degree of accuracy that is required. We have the most delicate files and gauges, and other tools, that can be made, so as to get everything as exact as possible. The first step, as I have said, is to cut the letter on the end of a piece of steel. Then that steel is hardened and driven right into a matrix, as if it were printed there. That is delicately filed up and tested, so that all the letters will agree when they are put in the casting. Then the molds and casting machines must be just as accurate as clockwork. Now, it is evident that all these appliances are very ex- pensive; but when you have once provided yourself with them you can do a great deal of work with that one plant. The English manufact- urers take that view. They say, u We have these matrices and punches and molds all on hand,” and they regard them as free of cost; so they make a lot of this nonpariel type and sell it very low — away below our price. They take nothing into account but the costof the labor, the metal, and the profit. Then two or three printers go and buy this English type at this low figure, and make affidavit that they have bought it in Eugland at that figure; and so the price is fixed so low that they can afford to pay the duty. We have had to fight them in this matter for years. I went before committees of the House of Representatives and of the Senate in regard to the matter, and before Secretary Bristow and Secretary Sherman, and we succeeded in convincing those officers of the facts of the case. We succeeded also in fastening the fraud upon parties in California, and they were mulcted about $3,000. Afterwards, however, they got an appraiser out there from Boston and had the matter decided in their favor before we had time to get a statement of the English market prices. As soon as the question was brought to my attention, I wrote to the Hon. John Welch, our minister, to send me the English founders’ prices, and he did so as quickly as possible ; but it was too late. The appraiser closed up the question and admitted the foreign type at the fraudulent valuation, and so I believe the matter stands to this day. Now, the type founders of this country ask nothing except that the duty upon foreign type shall be made specific instead of ad valorem. Type, as I have said, increases in size by successive steps, and there are a great many different varieties ; but I think they might all be put into three classes : type of one class paying a duty of, say, 10 cents ; another class, 12 cents; and another, 14 cents. Unless something of this kind is done it will be impossible to prevent fraud. I have been before the appraisers in the New York custom-house and explained the matter, and have convinced them, so that the importation of English type through that custom-house has been stopped. But 1 could not go to California to meet the question there. 1 now ask this Cominis- H. Mis. 6 37 578 TARIFF COMMISSION. I THOMAS MACKELLAR. sion to help us in our effort to have the law honestly administered for the protection of this important business. Unless that can be done, I do not think we can compete with this imported type. It is true that we might cut down the wages of our workmen, but we do not wish to do that. We wish to give them fair wages, so that they can live com- fortably. Theirs is skilled labor and ought to be well paid. If the duty were taken off, and type were put on the free list, as some parties propose, then we might close our foundries, except for one thing, namely, that our ornamental type is patented as fast as it appears, which pre- vents foreigners from sending imitations of it into this country. If the Commission visit Philadelphia, I shall be pleased to take the members through our foundry, which is the largest of the kind in America, and the most varied in the world ; and I think such a visit would give you gentlemen a better idea than you can get in any other way of the diffi- culty of establishing such a business, and the wisdom of cherishing it when it is established. Ity Commissioner Ambler : Q. You suggest three rates of duty: cannot you arrange it so that one rate will cover all ? — A. That might be done, but not very easily ; because the difference between the two extremes is so great. This bril- liant type, of which I have spoken, is so small that it takes about 4,200 letters to make a pound, while at the other extreme it does not take one hundred letters to make a pound, and then one kind of type is much cheaper than the other. When the late Hon. Fernando Wood framed his tariff bill there was a rate fixed for type, but, of course, that bill failed to become a law. By Commissioner Oliver : Q. Was the rate in the Wood bill satisfactory to the type founders ? — A. Yes, sir. Commissioner Ambler. It seems to me that if three separate duties so near together as 10, 12, and 14 cents, would be satisfactory, there ought not to be much difficulty in fixing upon a single rate which would cover the whole. The Witness. Perhaps not; and I will look into the matter more closely. Commissioner Ambler. Please do so; and when you submit your schedule, fixing three classes of type with corresponding rates of duty, I wish you would give us, if you can, at the same time, an additional proposition naming one rate which would be satisfactory. The Witness. As I have said, that might perhaps be done; but I fear that a rate fixed in that way would be prohibitory for a certain class of type. If we should fix on the middle rate, it would be prohibitory upon the extremes, because of the differences in size and price. MERRITT WICKHAM. ) appraiser's department, n. y. 579 MERRITT WICKHAM. Long Branch, N. J., August 21, 1882. Mr. Merritt Wickham, an examiner of merchandise in the New York custom-house, appeared and made the following statement: I am an examiner of merchandise received at the port of New York. Carpets, furs, hair of all kinds, bristles, baskets, and all the raw textile materials, except wool, are in my department. I have been engaged as an examiner some twenty years. Commissioner Oliver (in the chair). You may proceed in your own way to indicate any inconsistencies which you think exist in the present tariff upon the articles that come within your department, and to make any suggestions which you think worthy of the attention of the Com- mission. The Witness. I will begin with carpets: The average price of two- ply ingrain carpet is from 2s. 3d. to 2s. 6d., and the duty upon that is about 60 per cent. Three-ply carpet pays 17 cents per square yard and 65 per cent, ad valorem, and the average price is 3s. 3d. to 3s. 6d., with the ordinary discount; that makes that carpet pay about 65 per cent. Tapestry carpet pays 28 cents per square yard and 35 per cent, ad valorem, and the average price is from 2s. to 2s. 2d. sterling; which makes a high rate of duty. These figures are for 27-inch carpet. The average price of velvet carpet is 3s. 6d. to 3s. lOd. sterling for running yard of 27 inches, and it pays 40 cents and 35 per cent. Wilton carpet pays 70 cents per square yard and 35 per cent, ad valorem on the 27- inch running yard. While Axminster carpet, at from od. and 6d. to 8s., average price, pays 50 per cent. Now, the inconsistencies of that tariff are obvious. A poor man buying a two-ply ingrain carpet pays a higher percentage of duty than a man buying an Axminster carpet; for the duty on a two-ply carpet is about 60 per cent., while on the Axminster it is only 50 per cent. By Commissioner Garland : Question. Do you find any difficulty in levying the present duties? — Answer. No, sir ; the duties are very simple. I only speak of these facts to call your attention to the inconsistencies of the tariff. There are no tapestries imported, very few body Brussels, very few or no Wil- tons, no velvets, and no Axminsters. The carpets that are principally imported now are oriental whole carpets, and though I have now as many invoices for Sloane as I had ten years ago, yet where I would have one hundred bales of carpet on one invoice at that time, I have now two or three or four instead. There have been no tapestries im- ported for the last two years. Now, a specific duty could be easily levied upon each make of carpets. The prices of these carpets vary very little, so that the percentage would not be changed if you put a specific duty upon them at so much a square yard for each make of carpet, and it could be so regulated as to make it about the same as the ad valorem duty. The carpet trade is in the hands of a class of people about whose character there can be no question. I have never had any trouble so far as qualities and prices are concerned, and in all my experience I do not think I have advanced carpets more than ten 580 TARIFF COMMISSION. [MEKRITT WICKHAM. times, and those were cases where some outside parties had imported them. Mattings are all paying a specific duty. We get some mattings from Bombay, but only very few. The Ki-ya mats are all made in this coun- try, as the duty is prohibitory. There is another matter that ought to be regulated. We have estab- lished an arbitrary line of distinction between the carpet and the rug. When I was in Boston several years ago the question was asked me, what is a rug and what is a carpet. Whole carpets pay 50 per cent. aLd wool rugs pay 45 per cent. duty. This question was raised, and as 100 square feet makes a very fair-sized room, I suggested to the ap- praisers at Boston and Philadelphia that that should be the standard. Some of them thought it was too much and some thought it was very fair, and we finally agreed upon 100 square feet for a “carpet,” and the department approved of our decision, and since that time that has been the standard. Everything under that is a “rug,” which makes a differ- ence of 5 per cent, in the rate of duty. These rugs pay now the duties of their respective makes of carpet, but they could be brought in under a specific duty. In relation to furs, there has been a good deal of controversy as to what constitutes a fur skin. There are skins, the issue of a sheep raised for furriers, purposes, like the Caricoo, the Persiana and others. A skin of that kind which would be worth $3 for the wool or fur, would not be worth six cents for the pelt. Sealskins with the fur on are worth from 65 to 150 British shillings, while with the fur off they are worth only 20 British shillings a dozen. For this reason there has been a good deal of controversy in relation to what constitutes a fur skin, and we have had a great many sheepskins brought in with the wool on. They are dressed with the wool on, and the consequence is that the wool is good for noth- ing. They are imported largely for trimmings for cloaks and garments of different kinds, and under a ruling of the department they were taken out of the fur class and put into a higher scale of duty. In that connection I would suggest that all leather and all skins of every name and nature, whether mentioned in that connection or not, be fixed at one rate of duty. My idea is that there are too many classes of goods and too many rates of duty in our tariff, and that it could be simplified very materially by having many less rates of duty. Fur skins of all descriptions, not dressed in any manner are free. They take those skins and trim them, and then they are brought here and recut by American machinery, and they make what is known as short fur, felt fur. Those, as I have said, come in free. Then there is another class that come in at 20 per cent., simply because they have been dressed, although they are used for the same purposes. They are put into a little machine and cut fine, and the fur is blown out of them and is used with other furs in making felt, !Now I would suggest that pieces of fur skins, whether dressed or undressed, for recutting into hatters, furs, should all pay the same duty. I see no way of putting a specific duty on furs under any circum- stances, because the skins range in value from 5 cents up to $50 apiece ; a squirrel skin is worth 10 cents, while a sable skin is worth $100. Then there is an article known as isple. It comes from Mexico. It is used for making cheap brushes, scrubbing brushes and the like. It is the product of the cactus. Sisal grass for matting pays a duty of $15 a ton, although it is the same species of goods. Manilla hemp is not pro- duced in this country. It is imported for cordage. It comes in compe- tition with nothing raised in this country that I know of. All the MERRITT WIC K H AM . ] appraiser's department, n. y. 581 hemps differ but slightly in their prices, and consequently may be left under a specific duty at whatever rate maybe determined upon; but dressed flax ranges from 7 pence to 24 pence sterling and pays a duty of $40 a ton. You see, therefore, that a poor man has to pay a large rate of duty on cheap flax, while the wealthy man pays no more on high priced goods, and that seems to me an unfair rule. By Commissioner Oliver : Q. How would you make a dividing line? — A. I have no suggestions to make on that point. Q. Could these goods be assorted and divided satisfactorily? — A. That is a rather vexed question. I have been thinking of it for the last week, and I don’t see any way of arranging it, but you can see that the rates of duty are very unequal. There is another article which comes here that has been causing a good deal of trouble, and lias caused us, perhaps, to do injustice to some parties. I mean baskets. They do not belong to my department, but I have had charge of them for a number of years. Baskets came in various shapes and forms, and now they are getting to trim them, and the department sometime ago made a rule that baskets trimmed and lined with worsted should pay a certain rate of duty. About six months ago a gentleman had the courage to sue the government, and he beat them on that point. The court decided that they must exhaust the basket before they could levy any other rate of duty. But when you come to silk linings, the department has decided that we must charge 60 per cent, upon them, provided the silk is the chief value, and I defy any man, in most cases, to tell whether the silk is the chief value or not. Now my suggestion would be to have two classes of baskets, one con- sisting of baskets lined or trimmed with silk and paying one rate of duty, and all other baskets coming in at another rate. Q. W ould it not be better to say that all baskets lined or trimmed with silk worsted should pay a certain rate, and that all baskets trimmed with other material should pay another rate ? Are they not sometimes trimmed with other material ? — A . They trim them with cotton and with jute. But silk, you know, pays 60 per cent., and therefore if I were to make the law myself, I should provide that baskets of whatever mate- rial should pay one rate of duty, but if there was to be any discrimination, and if it was thought desirable to have silk-lined baskets pay more than others, the duty should be specific. In baskets trimmed with worsted, the worsted is so insignificant in value that it would be hardly worth while to make any discrimination between a basket so trimmed and the clean basket, because cotton pays the same rate of duty. Bristles are another article that come in from Russia and Germany. That is a very exten- sive trade. Now bristles vary in price from 75 cents to $9 a pound, and I do not know how you are going to make proper discrimination. By Commissioner Ambler : Q. That, I suppose, is a case in which an ad valorem duty would be better, according to your judgment? — A. Yes, sir. By Commissioner Porter : Q. You could see the way out with an ad valorem duty? — A. Yes; but vith a specific duty I cannot see the way out. Very few high- priced bristles come here ; but bristles do range in price from 75 cents up, and they all pay a duty of 15 cents. By Commissioner Kenner : Q. Is sisal in your department ?— A. It is ; it pays $15 a ton. 582 TARIFF COMMISSION. [MERRITT WICKHAM. Q. Wliat does it come in competition with ? — A. Nothing that I know of in this country. Q. Why could not sisal and manila be put into the free list ? — A. I should say they ought to be. They do not compete with anything that is produced here. Some hemps, perhaps the Eussian and Italian hemps, come in competition with our own, but there is no sisal raised in this country, and no manila that I know of. My individual opinion has always been that raw materials that do not come in competition with our borne products should be admitted free. There are certain raw ma- terials which do come in competition with our home products, and they, of course, ought to pay duty ; but my idea in regard to the tariff, based upon many years of experience, is that we should have fewer classes of goods and fewer rates of duty, and that where a manufacture has been thoroughly established in this country, the tariff should be regulated simply with the view to equalize the difference in the price of labor here and abroad. By Commissioner Oliver : Q. Do you have any trouble with the item of “charges” in your de- partment?— A. Carpets are “free on board.” The European manufact- urers deliver their goods on shipboard. Q. What commission is charged? — A. 2J per cent, on English goods; 3 per cent, on French. Q. Do you think a uniform fixed rate for both charges and commis- sions would give less trouble and more satisfaction ? — A. My idea is that inland charges should be abolished. Q. Can you name a rate that would cover the line of goods that you have had experience with ? — A. I think that perhaps a rate of 3 per cent, would do ; or an addition of 1 or 1J per cent, to the regular com- mission of the country. It is a difficult matter to get at the charges exactly, and I should be inclined to recommend a uniform rate. Q. Would you recommend a uniform rate for commissions? — A. It would simplify the business very materially. About one half pay com- mission and the other half do not. R. BLAKELEY.] SORGHUM. 583 E. BLAKELEY. Long Branch, 1ST. J., August 21, 1882. The following communication in relation to the duties upon sugar and sugar sirups, was received from Mr. E. Blakeley, of Saint Paul, Minn., and ordered to be printed : Gentlemen : Supposing that it is the purpose of your Commission to hear what may be said in relation to the bearings a tariff may have upon the industries of the country, as well as to raise the means for sup- port of the government, I am induced to present to you a few thoughts on the subject of the production of sugar and sugar sirup, for the con- sumption of the people of this country, and my object is to induce the Commission, so far as I may, to protect this new industry by the adjust- ment of the rates of duties upon the imports of sugar and sirups from other or foreign countries, in competition with our own. As is well known to all, the effort to make sugar and sirups from sor- ghum has had a varied and mostly an unsuccessful existence for twenty years or more, and the most sanguine had about given up the strife against the adverse experiences attending all such new enterprises. Some five years ago, in spite of all former experiences and against every rule for making sugar, an old sorghum boiler’s sirups turned to sugar in his barrels in his cellar, and thus, in spite of all the ignorance, charlatanism, bogus professors, and patent rights for making sugar from sorghum which had been used for over twenty years to present this re- sult, nature has finally asserted herself and, against all hope, produced a few hundred pounds of sugar, which has again induced the enterpris- ing people of this Northwest to give it another trial, and with such suc- cess that the Commissioner of Agriculture of the United States felt com- pelled to give the matter his personal attention, and it finally has chal- lenged the attention of the “Academy of Natural Sciences,” who, at the request of the Commissioner of Agriculture, took up the work of the chemist of the Agricultural Department and reported the same to a com- mittee of the most eminent scientists in the country, who have given the last two years’ work a careful investigation, and have unanimously agreed that this plant stands next, if not equal, to the sugarcane of the tropics as a sugar-producing plant. This report has not yet been printed. During the past five years the produce of sirup from this plant has constantly increased, and now amounts to some millions of gallons per year, which is being sold by the merchants, wholesale and retail, for gen- eral consumption, and machinery is now being introduced that will make yields in sugar that will astonish even those the most sanguine and best informed on the subject ; but those who engage in this new enterprise must feel that they are to have the care and sympathy of this govern- ment for the development of this promising and, if successful, great in- dustry. Unfortunately there are only very few persons who have as yet at- tempted to produce sugar, from this source, as the machinery that is used in making sirup is not calculated to make sugar. I am the only 584 TARIFF COMMISSION. [R. BLAKELEY. one in this State that has expended the money necessary to put up the machinery to make sugar, and have made only what may be called an experiment, but I have made some twelve thousand pounds of sugar, which was sold at the factory for 9 cents per pound, and the sirup for 50 cents per gallon. I have inclosed herewith a sample of this sugar. This is not a selected sample ; it is taken from the produce of the mill without extra handling or care, but is a true sample commercially. I may be somewhat presumptuous in venturing an oxnnion upon this subject when addressing a commission selected for their great and varied intelligence and experience on the subject submitted to them j still, I feel justified in saying that if the government shall by legislation foster the production of these now indispensable articles of daily consumption by the people, the near future will justify and approve the action. I am sorry that I am unable to present you something more convinc- ing upon this subject, but the scarcity of material is owing to the new and undeveloped condition of the industry, and I have not thought I would be justified in taking too much of your time by attempting to dis- play any great information on the subject, as that, in my opinion, would be out of place before you, but I simply hope, by this communication, to induce you to give it a favorable consideration. Respectfully, Saint Paul, Minn., August 9, 1882. R. BLAKELEY. STEPHEN BKOWN. ] LEATHER. 585 STEPHEN BROWN. Lono Branch, N. J., August 21, 1882. Mr. Stephen Brown, of New York, a broker in leather and hides, ap- peared before the commission, and made the following statement : The duties now levied on leather, say 10 per cent., 15, 20, 25, and 35, according to description, appear very inconsistent. The imports of leather for 1881 amounted in value to $5,651,272. The aggregate duty paid was $1,219,805. The largest item of import was tanned and finished calf, amounting to $2,365,672, which, at 25 per cent, duty, paid $591,418. Sole leather paid $1,259 only on an import of $8,398 at 15 per cent, duty. It would seem quite unnecessary to have more than two classes in lay- ing a duty on leather. The great advantage which tanners of sole leather in America have over all the countries of Europe in cheap bark has enabled us to sell for export a large amount of sole leather besides, a con- siderable quantity of upper leather. The exports of leather from the port of New York alone in 1881, amounted in value to $5,375,760, and from other ports there was enough to make a total of more than $7,000,000. This export of American leather, which is composed largely of hemlock-tanned sides, has, within the past ten years, greatly increased ; for in 1871 the amount was barely $1,000,000. Whatever advantage a tariff may have been to American tanners in the past, it would seem probable that it has outlived its usefulness. Tanners in Europe regard with alarm this augmented demand on the part of manufacturers of shoes and other goods made of American leather, and complain that while America requires a duty on the goods that they produce she inundates their own markets with an article they cannot compete with. The German Government responded to the clamors of tanners some three years since, and put a duty on foreign leather equal to 6 cents per pound, or about 25 per cent. France protects her tanners ostensibly for the same reason, and English tanners are begging for the same protection, but claim that if they could sell us their goods on equal terms, that is, “free of duty,” many articles they make could at at times be sold here and the trade be more “fair.” The shoe manufacturers of England and of Switzerland have every- thing they use free of duty, and they sell their shoes in great quantity to Brazil, to the countries bordering on the Mediterranean, to Mexico, and all parts of the Spanish Main of South America and adjacent islands. This is an immense trade, and there is no reason why the shoemakers and artisans of the United States should not be competing successfully for it. But that cannot take place while a duty so large and so intri- cate exists on foreign-tanned leather. We make excellent upper leather of many grades, and sell a deal of it abroad, but many kinds of foreign- made leather (it would be tedious to enumerate them) areneeded in mak- ing leather goods for export, which come too expensive to our manufact- urers to purchase abroad, and which are not required for home use j so that our exports of boots and shoes are as yet scarcely worthy of men- tion. 586 TARIFF COMMISSION. [STEPHEN BBOWX. In consultation with leading tanners making their headquarters in New York, I have found that there is scarcely one who does not express himself in favor of absolute free trade in leather. A confirmation of this assertion, if desired by this Commission, could be readily obtained by the signatures to such a statement of the principal well-known large leather houses in what is known as the u swamp” section of that city. If the requirements of government for revenue would be deemed so imperative as to need the duties that might be obtained from the impor- tation of leather goods, it would seem that a uniform duty of 10 per cent, would reach that case, as the various duties now imposed are vex- atious to those interested in handling foreign leather on both sides of the Atlantic. The leather trade and tanners of America are strong enough to feel indifferent to foreign competition, and generous enough to their brethren in the craft all over the world to meet them on equal grounds, and all the most extensive tanners in America, whether at the seaboard or in the great wilderness tracts (where they are the pioneers), would hail with pleasure such a revision of the tariff as would make leather free of duty, or at least reduce the duty to the lowest rate that the interest of the people would permit. They believe that the more free the inter- change the greater would be the volume of our exports, and feel sure that instead of the country relying eutirely on its exports of cotton and food products to keep up the balance of trade with foreign countries, it would be better to enable our citizens to avail themselves of the raw ma- terial of other countries as well as of such manufactured articles as are auxiliary to their operations. They would then be put in position to add to the volume of exports, as our tanners are now doing, and thereby consume at home our food products. Switzerland has many tanners, and they are prosperous ; but Switzer- land would have no work for her great army of shoemakers if a duty on leather products in America and other countries was prohibitory instead of those products being free. We can never compete with Europe in supplying Mexico and South America with shoes for their growing nations while we impose a high duty on material and invite Germany and France, and perhaps England, to put discriminating imports on our leather. Shoemaking in every land becomes an important source of employ- ment for surplus population when agriculture and kindred occupations change their base. It has been so in New England; it is becoming so in other sections. The tanners of America would aid it, and they have material and bark enough to sole and to half-sole all creation. They have capital, enterprise, and ample intelligence, and, like all good citi- zens, do not ask to be assisted to grow rich by the shield of a protective tariff. They do not believe that intelligent labor can be performed cheaper elsewhere than in America, but many articles which are not yet introduced into this country to any extent would greatly facilitate shoes being pro- duced suitable for export, and the goods that are made here would also enter largely into those manufactures. The idea of the present period is that the American people should be intrusted with the utmost freedom, having at the same time laws strong enough to shield society from any recoil of its outburst. There is no element of freedom that we can give to the next generation of Americans which they will so gratefully accept and applaud as the legacy of free trade. Our export trade in sole leather is very important. I have been en- gaged in it for twenty years ; indeed, I was the pioneer in it, and 1 feel a strong interest that it should continue to prosper. STEPHEN BROWN.] LEATHER. 587 By the President : Question. What are the peculiar advantages of American tanners in the possession of hemlock bark? — Answer. We have bark so much cheaper than they have in any part of Europe that in that respect they cannot begin to compete with us. We have it generally at $4 a ton, and $5 a ton is perhaps as high as any of the great tanners in this country pay for it, while in Europe it costs five or six times as much. By Commissioner Boteler: Q. Has the Shoe and Leather Association ever taken any action in this matter? — A. I am not aware that the association ever made any statement on the subject, but probably they will send a representative before your Commission when you go to Boston. You have in that as- sociation a combined interest, the shoe interest and the leather interest. The shoe men, of course, would like to have their leather as cheap as possible, while the tanners in some sections of the country might pos- sibly feel that they needed some protection. I am not aware, however, of any tanner who asks any favor in the way of protection. The only article of leather imported largely now is French calfskin. This in- tricate duty of 10, 15, 20, 25, and 35 per cent, is very embarrassing, and even the custom-house appraisers find it so. I think it would be worth while, therefore, for this Commission, if the duty must be continued, to recommend that it be made uniform. There is no reason why the duties should be so various ux>on goods of slightly different grades. Q. I understand you to say that the tanning industry has been brought to such perfection here that you think it can now compete with the Euro- pean tanners? — A. Yes, sir; I think we can compete in all tanning goods. There are goods made in Vienna that must be still imported, because nobody in America attempts to make Vienna leather or Russia leather, although we do make some kind of an imitation of Russia leather. By Commissioner Ambler : Q. You suggested two rates, but afterwards in your paper you named only one. Assuming that we make two rates, I should like to have you suggest what those rates should be. — A. I think there is no object at all in having a duty on sole leather. We only collected $1,200 last year from the duty on sole leather on a 15 tier cent, basis, and I do not see what the object is in continuing that duty. Q. Then you suggest that sole leather should be free? Please give us the next grade of duty that you propose? — A. I am so thoroughly a free trade man that I hardly dare name even 10 per cent.; but that would seem to me to be ample. Q. Then your suggestion is, sole leather free, and 10 per cent, duty on other leathers? — A. Yes, sir; that would seem to be about right. Q. What are the grades of leather? — A. We imported last year $2,365,000 worth of tanned calf, and of other upper leather, $2,881,000. On tanned calf the charge is 25 per cent. ; on bend and sole leather it is 15 per cent., but we import none of that; and on morocco the rate now is 10 per cent. The principal duties collected were upon tanned calf and what is generally known as upper leather. Of patent leather we import very little ; the duty on that is 35 per cent. 1 am filling orders from Europe all the time for large quantities of carriage leather. They have just learned there what American leather is. Our leather is tanned with bark, while in England, owing to the high price of bark, they have been compelled to use bichromate of potash and other chemicals, which do not make so good a leather as ours. Twenty years ago we exported 588 TARIFF COMMISSION. [STEPHEN BROWN. no leather, but now the trade is very extensive. It was started in 1859, but the war coming on soon after broke it up. In 1870, however, it revived, and it has since grown largely, so that it is now a very im- portant item of export. There are few manufactures in America that have grown as fast, and it is probable the business will increase largely in the future, because we have the hemlock forests to supply the bark. Q. How is it as to oak-tanned leather? Do we stand as well on that as on leather tanned by the use of hemlock bark? — A. In Pennsylvania there is a great deal of oak leather made, but the home demand has been sufficient to use all that is made. There is considerable demand for it in Europe, but we do not sell it cheap enough. We make an ex- cellent article of oak leather in Pennsylvania, but the English have such a talent for imitating it by using a little oak and a large quantity of chemicals, that we cannot go into that market. "Neither have we so much oak bark in America as we have hemlock bark. I do not think we shall do a very great business in exporting any leather except hem- lock-tanned sole leather, and even as to that, foreign countries are threat- ening us with an embargo on our exports of leather, because, as they say, we make no concessions to them. By Commissioner Kenner : Q. Has any government in Europe up to this time retaliated upon us because of our duty on foreign leather? — A. Yes, sir; Germany did so three years ago. Q. What duty did she put on sole leather? — A. About six cents a pound. By Commissioner Oliver : Q. Has there not grown up quite a business in extracting and con- centrating the essence of the hemlock bark and shipping it abroad? — A. Yes, sir, a very large business. Q. When did that begin? — A. I think it has been going on more or less for fifteen years. They are shipping a great deal from Canada now, and also a good deal from this country — from Pennsylvania. Q. Do they ship it also in the form of ground bark? — A. They do that to some extent, but they have a system of extracting the tanning material by evaporation — quite an ingenious process — making a liquid very sim- ilar in appearance to molasses. They claim to get the strength of a ton of bark in an ordinary barrel of the liquid. Q. Does that liquid answer the purpose of tanning as well as the bark, or is there a special advantage in using the bark itself ? — A. State- ments on that subject are very contradictory. Our tanners say that the liquid is not so good as the bark itself, but in England many tanners use it, and they claim that it is just as good. I have not any positive opinion on the subject myself. I think that for many kinds of leather the liquid is as good, but for solid, hard leather, I do not think it is so good as the bark. That is my impression from information that I have received. Q. Still it will be quite an advantage to foreign tanners if they are able to obtain this extract, which can be readily and cheaply trans- ported? — A. Oh, yes, and they have used it very largely. They were using it very extensively three or four j^ears ago, but for the last year or two they have used less of it, because they have been attempting to work other chemicals. The result is that they make their leather soft, and when it gets wet it is just like cloth ; and the more they use those chemicals instead of bark, the more of our sole leather we shall be able to sell in their markets. STEPHEN BKOWN.] LEATHER. 589 By the President : Q. Is not the hemlock bark tanning industry almost entirely a North- ern industry'? — A. Yes, sir. Still, there is a great deal of good tanning done in the Southern States with what they call their chestnut oak. They make a very excellent leather in the South, but they do not make as solid a leather as is made with hemlock bark ; in fact, the Southern people use the hemlock-bark sole leather almost entirely, and I am told by. tanners who have establishments in the Southern States that the bark is already becoming quite expensive. Commissioner Botelee. There are vast forests of it still untouched in West Virginia; the only difficulty in the way of its use being the cost of transportation. Very large tanneries have been established within the last few years in the Southern States. Within the last year one has been established in the Luray Valley, where they are using oak bark, and making excellent leather; and in fact that portion of the South never has depended on the North for its leather, but has used the oak leather. By Commissioner Garland : Q. I understood you to say that Germany had levied a duty upon our leather by way of retaliation for our tariff on leather; I should like to know your reason for that statement. How do you know the fact'? — A. Well, I never conversed with Bismarck on the subject, but I understood that the German tariff was retaliatory ; that the German tanners clam- ored about it, and petitioned the Beichstag to protect their leather, and that they succeeded in getting the desired protection. Q. You made the statement without qualification, and I simply de- sired to know the basis on which you made it. — A. I suppose there may be some question as to whether that statement could be exactly proved or not; but we read in the Eurojiean free-trade journals statements that America is sending a great deal of leather over there, and that they ought to retaliate. 590 TARIFF COMMISSION. [WILLIAM LYALL. WILLIAM LYALL. Long Branch, N. J., August 22, 1882. Mr. William Lyall, a manufacturer of jute, appeared and submitted the following statement of changes in the existing tariff on jute manufact- ures, recommended by the Dolphin Manufacturing Company, by John ♦Sloan, Paterson, N. J. ; Planet Mills, by Buchanan & Lyall, Brooklyn, N. Y. ; Finley & Schlicliter, Lambertville, N. J.; Chelsea Jute Mills, New York City; Peter Bentley, Jersey City, N. J.; J. & W. Lyall, New York City: Present tariff designation, Present rate of duty. Proposed rate. Reasons for the change. Burlaps made of jute Bags m ade of j ute Colored or partly colored jute manufactures. Jute yarns Abolishment of the draw- back on jute goods after use here. Canvas, paddings, cot bottoms, crash, hop sacking, and webbing made of jute. Oilcloth foundation or floor-cloth canvas made of jute. Bagging made of jute, except gunny bagging. Russia and other sheet- ing. component parts of jute. Carpets made of jute Articles made of jute, or of which jute shall com- pose the chief article in quantity, not other- wise provided for, ex- cept such as shall be suitable for bagging for cotton. 30 per cent, ad valorem 40 per cent, ad valorem . 30 per cent, ad valorem . 25 per cent, ad valorem . 3^ mills per ounce See Schedule A. do See Schedule B. 8 cents per square yard . See Schedule C. 3J cents per pound See Schedule I). See Schedule E. 35 per cent, ad valorem . 40 per cent, ad valorem . .do. 35 per cent, ad valorem . 8 cents per square yard . 30 per cent, ad valorem . The same as proposed upon burlaps, 3| mills per ounce. .do .do .do 8 cents per square yard not weighing over 24 ounces, and 3 mills for each additional ounce, but that carpet made after the manner of making Brussels tap- estry, tapestry velvet, or any other kind of carpet, shall be duti- able the same as the carpet made in the same manner. 50 per cent, ad valorem . They are a similar or better class of goods to burlaps and should be dutiable at the same rate. It is a similar or better class of goods to bur- laps and should be dutiable at same rate. It is the same class of goods as burlaps and should be dutiable at the same rate. Do. See Schedule E. Because there is not suf- ficient protection now to maintain the jute in- dustries which pay a duty of fully 30 per cent, on the raw jute. Raw jute, 105 rupees or $46.72 per ton; United States duty on same $15 or 32 per cent. Schedule A. The reasons for the changes proposed are — First. Because the jute interest under the existing tariff is not remu- nerative, and consequently requires additional protection. Second. Because there is a tariff of $15 per ton or 30 per cent, on the WILLIAM LYALL.] JUTE. 591 raw material here, and free jute in Scotland, while our labor is about double. Third. Because the tariff should be specific to insure uniformity. To illustrate, in 1872 burlaps was worth one cent per ounce, now it is only worth one-half cent per ounce ; thus the duty has been reduced to one- half what it was originally. Fourth. Because the Secretary of the Treasury and the Supreme Court of the United States, in Gumming v. Arthur (91 U. S. Sup. Ct. Bep., 362), defined oilcloth foundations dutiable now at 40 per cent, ad valo- rem to be only that class of jute fabric which has 24 porters or thread to the square inch ; the result is that all the foundations for oilcloth now imported and used in this country are called burlaps and are duti- able as such, not having 24 porters or threads to the square inch. Schedule B. The reason for the proposed change is, that bags which have been used abroad, and known as second-hand bags, are purchased at very low prices and sent here and sold. The tariff being upon the value of the goods at the point of shipment makes the protection entirely inadequate. Schedule C. The reason for the proposed change is, that there is a class of novel- ties in jute goods being manufactured, which are of the same grade and style of manufacture as jute carpetings, which are not provided for specifically in the present tariff, and therefore come under the general provision, and are thus dutiable at 30 per cent, ad valorem ; this change will place these novelties under the same protection which jute carpet- ings have. Schedule D. The reason for the proposed change is to put the duty at about what it was when the present rate was fixed, and to make it specific that it may be uniform. In 1872 the price of yarn was 13 cents per pound ; now it is worth only 7 cents. Schedule E. The reason for abolishing the drawback is that the importer of bur- laps is allowed under the existing law to sew it into a bag, sell it to the miller here, and after it has been exported obtain a drawback of the entire duty less one per centum. The effect of this is best shown by the following advertisement and correspondence: [Advertisement. ] EXPORT FLOUR SACKS, BURLAP, BRAN SACKS, WOOL SACKS, OIL-CAKE BAGS, HAM BAGS, ETC. Morison, Anderson & Buchart, Dundee, Scotland, Manufacturers of all kinds of Jute Goods, Have established a branch house in Minneapolis for the manufacture and sale of their products. Exporters of flour will receive from them rebate of duty on all bags exported. Bags printed in the best possible style. Apply for samples, prices, and particulars to J. P. THOMPSON, Manager, 214 and 216 First avenue S., Minneapolis. 592 TARIFF COMMISSION. [WILLIAM LYALL. [Letters.] Minneapolis, Minn., March 29, 1882. Dear Sir : Yours of the 18th to Mr. Campbell received. We do not know what the matter is with oar export trade. Can you tell? Ogden has left for Saint Louis. A new man has taken his place here. Your name- sake is still here, but not handling Morrison’s branch house of Dundee, Scotland, sax. Mr. Thompson is doing business here, and is taking the persimmons because he makes a low price on the sax and then pays us 2 cents rebate, according to weight of sack, collecting it himself afterwards. As to orders, would say that we are still in favor of the seamless sack, made by the Chelsea Jute Mills, New York City ; still consider them the best, and are glad we can go to headquarters to buy them and get quality guar- anteed. We should preferto buy when we want them and not carry a stock, which we dislike, as we have no warehouse. We shall be glad to see you here, and if you can arrange to keep a stock shall be glad to give you a share of our patronage. Yours truly, CHAS. A. PILLSBURY & CO. L. M. Ballard, Care Chelsea Jute Mills, Twenty-fourth street and Thirteenth avenue, New York City. Kankakee, III., May 13, 1882. Gents ; Yours, no date, received. Until recently we have been using Dundee bags 29 x 40, but now we are using a bag made in Saint Louis from burlap, 11 oz., 32 x 40, which is a better size for our cake. A good many mills in the West are changing to this size, and for our style of cake it will no doubt be the popular bag. If you can make 32 x 40 bags in your seamless goods we would be pleased to have sample and price. The advantage in use of a burlap bag made in this country is that we can ob- tain a custom rebate of about 2 cents each when the cake is exported. Yours, truly, M. BAILEY & CO. Chelsea Jute Mills, New Yorlc. Schedule F. The reasons for the proposed changes are that weight constitutes value to a great extent, and that heavy carpets should pay more than light ones. Also, that the method of manufacture should be considered ; for example, the ordinary j ute carpet, the only one which was known in this country and in Europe at the time the tariff upon it was fixed, is worth in this market about 25 cents per yard ; since that time the Scotch manufacturer has used jute successfully in the manufacture of Brussels and other styles of carpets, and is enabled to dispose of his Brussels carpets here at about 50 cents per yard, because the custon department has ruled that the style of manufacture does not alone make the carpet, but the article used has standing in determining it, and thus the foreign manufacture is driving out a large part of the trade in ordinary jute carpets. J. Q. HOWARD.] HOME VALUATIONS. 593 J. Q. HOWARD. Long Branch, N. J., August 22, 1882. The following letter of Mr. J. Q. Howard, appraiser at the port of New York, was ordered to be printed: Port of New York, Appraiser’s Office, May 14, 1880. Sir: Respectfully referring to department letter of May 5, requesting a report em- bodying my views upon the bill now pending before the House Committee on Ways and Means, in relation to the collection of the revenue from customs, and for other pur- poses, I have the honor to say that the bill in question contemplates a radical and fundamental change in the basis for the collection of ad valorem duties. The bill is constructed on the theory that the market value of merchandise in the principal markets of the United States, at the time of entry, can be more easily and more accurately ascertained than the market value of such merchandise at the time and place of shipment. Where goods are procured by actual purchase abroad, the evidence of foreign market value afforded by a bona fide purchase and sale of the identical goods shipped, would seem to be better evidence of their value than that based on opinions as to what such goods could, would, or should sell for in the dooiestic market, before they are either offered for sale or sold. If merchandise is procured otherwise than by purchase abroad, we have the cost of manufacture, among oth r elements, to aid in arriving at market value. By a comparison of invoices of like merchandise from the same foreign district, or port, our experts are able to equalize valuations on invoices and raise the prices upon the invoice of the dishonest shipper to the standard of the prices on the invoice of the honest exporter. The prices current, constant correspondence, and the assistance furnished by consular officers, have, of late years, lessened the difficulties of approximating closely to the foreign market value of all merchandise shipped from other ports of the world. So far as the home market value of staple goods is concerned, it would not perhaps be very difficult to keep pace with the gradual fluctuations in the prices of shell goods in the principal market of the United States. Many lines of fancy goods vary in market value in this market, not only from day to day, but from hour to hour. The amount in duty paid by one merchant, who enters goods in the morning, would be greater or less than the amount paid on the same goods entered by another merchant in the afternoon. No two merchants would be likely to agree as to what the market value of any particular article was on any given day. On the question of percentage of damage on damaged merchandise, the best mer- chant experts at this port have varied from 2 to 40 per cent. Their opinions would, of course, vary as to market value. By whose opinion is our expert to be governed? Is he to leave his desk and go on the street to learn the market value of each new lot of goods, covered by each one of the ninety invoices which he sometimes passes in a single day, or must each examiner be furnished with a messenger to be sent hourly to ascertain market value? When an undeniably new fabric is imported, what is the market value of that fabric at this port? And how can that market value be ascer- tained before the fabric is either seen by the importer or sold? There are certain lines of merchandise that are controlled in this market by three or four houses. The market value would be whatever those few firms chose to make it. If such goods were taken to the account of the government to be sold at auction, the price at which they would sell would often be controlled by two or three houses, and where the importation was very large, in many instances by a single house. In fact, it seems not only probable, but reasonably certain, that if such a bill as the one proposed should go into effect, the price of merchandise sold by the collector at auction would be in many instances absolutely controlled by ring combinations for the purpose of forcing the collector to sell the merchandise at rates far below the true market value. In appraising merchandise, we are required to consult the principal markets, not the principal market of the United States, in order to determine market values. This would seem to require the appraiser not only to be informed in regard to the market value of thousands of articles of merchandise in the New York market, but also their value in Philadelphia, Baltimore, and Boston. How is the market value of goods at the other ports to be obtained on the day when a thousand invoices are received, the num- ber of invoices passed by this department reaching as high as 30,000 in a single month ? The market value of almost all merchandise varies, more or less, at different ports. If less at the smaller ports, a less amount of duty will, of course, be j>aid by impor - ers at those ports; consequently injustice would be done importers at the larger ports. The efforts of one merchant to undersell another at different ports, or at the same port, cause home market values to bo a constantly varying and fluctu- ating thing. This is especially true of articles, the sale of which depends upon the H. Mis. 6 38 594 TARIFF COMMISSION. £r. Q. HOWARD. varying tastes and fashions of people of fashion. These market values of most goods vary with the seasons. Woolen goods are often imported in August; for which there is no market value until the following fall or winter. Importers would he likely to import goods at the time when their market value is the lowest; that is to say, when summer goods would be imported in winter, when there is little or no market for them, and winter goods imported in midsummer. Many lines of goods, such as carriages and furniture, and wearing-apparel, both old and new, are not sold at the ports where imported, and consequently have no fixed market value there. >■ The difficulty in obtaining the domestic market value of most kinds of merchandise is illustrated by green fruits. Almost all kinds of green fruit are sold at this port, at auction, and the market value in this market is what it brings at auction, which can- not be ascertained until the auction is over and the accounts are settled. In the case of all perishable goods, undervaluations, on the part of the importer, of from 10 to 30 per cent, would be perfectly safe, because no prudent collector would assume the risk of selling oranges and bananas, daily deteriorating in value, ten days after importa- tion, when they might not be worth more than one-tenth what they were worth on the day of importation. When articles are imported in a crude or unfinished condition, they are of little or no value, except to those for whom they are imported. Of this class are portions of machinery and patented articles. We are now receiving, for example, importations of kid gloves, cut and made especially for the “ Foster fastening,” which is applied here. These gloves are useless to the general trade, in the condition in which they are imported, and the patentees are the only parties who can put them in marketable condition. They would not have, under the law proposed, any dutiable value, as they have no market value in the condition in which they are imported. The interminable calculations that would be necessary to arrive at the exact home value of merchandise, less the duty imposed upon it by our present tariff, present in- superable objections to the first section of the bill under consideration. This difficulty will be apparent in the case of an invoice of dress goods, varying in quality and width, a portion being 21 inches wide, worth 20^ cents per yard ; some 24 inches wide, worth 32 cents per yards ; and a part 27 inches wide, worth 16 cents per yard. The duties upon this class of goods are, “if not exceeding 20 cents per square yard,” 6 cents per squareyard, and in addition thereto 35 percentum ad valorem ; valued at above 20 cents per square yard, 8 cents per square yard, and in addition thereto 40 per centum ad valorem. The same difficulties exist in relation to cotton goods, metals, wools, and woolens, and all other articles subject to a mixed rate of duty. An increased clerical force, with mathematical ability of the highest order, would not prevent aggravating delays in the classification of such merchandise. If the main principle embodied in the first section of the “ proposed bill ” is unsound, the remaiuing sections of the bill fall with it, and need not be at length discussed. Section 2, I may say, however, re-enacts one of the worst features of the existing law, a law which no district attorney has had the audacity to enforce in the United States, and which is practically a “dead letter.” Section 16 of the bill sounds like the production of an inspirational medium, so de- void is it of the practical, equitable, common-sense elements which should control a government in dealing with its citizens. It is a sound principle that a man should not be compelled to pay a duty or tax upon what he never receives. What he receives in an absolutely worthless condition, he does not in any proper sense receive at all. The government, therefore, should not add to the calamity of a loss of merchandise the infliction of a tax upon the merchandise lost. Under this section, if an importer receives 100 cases of oranges, 40 of which are rotten and worthless; or 100 cases of window glass, the glass in 45 of which cases is broken and worthless, a rebate of duty should be refused on this worthless merchandise, which, in reality, has never been imported, unless the importer abandons all his goods to the government. There is a manifest inconsistency between section 16 and section 12 of this bill, for the reason that it is immaterial to the merchant where his goods are destroyed, whether on the voyage of importation, or after the voyage ended ; the fact of their destruction being the only material point in the case. In conclusion, let me say that section 14, which provides for the abolition of petty fees, is the only section of the bill which meets with the hearty approval of all the principal officers in this department. The exaction of petty fees, which involves au additional tax on imports, and a tax, also, upon goods free by law, is an annoyance and au abuse which ought to be speedily removed. With great respect, your obedient servant, J. Q. HOWARD, Appraiser. Hon. John Sherman, Secretary of the Treasury, Washington, D. C. H. 0. HOUGHTON.] AMERICAN PUBLICATIONS. 595 H. O. HOUGHTON". Boston, Mass., August 22, 1882. Mr. H. O. Houghton, of the firm of Houghton, Mifflin & Co., pub- lishers, Boston, Mass., submitted the following statement: I merely desire to say that I trust the tariff on books will not be changed, unless from an ad valorem to a specific duty. If this can be done, and the rates properly adjusted, it would be a great gain in the way of preventing improper entries. The reasons why I think the duty is low enough now, and that it would be a great injury to our business to have it reduced, are the fol- lowing: In making the stereotype plates of a book, I took occasion some years ago to estimate carefully the proportion of manual labor to the whole cost of the manufactured product, and my recollection is that it was 90 per cent of the whole cost of the plates ; and I think I could demonstrate readily that I made no substantial error in that estimate. Labor of the kind employed in this business when I was in England, in 1864, was about one-third of what we then paid for it here. I did not make so careful an investigation last, year, when I was abroad again, but from what I made I should judge that labor employed in the man- ufacture of books was about half the cost in England of what it is in this country. In machinery we equal, if we do not in some respects ex- cel, the English, and if there were not so large an element of hand- labor in the production of books in this country we should be able to get on with a less tariff. Everything that enters into the manufacture of a book, and in that respect is raw material, is subjected to a higher or as high a duty as manufactured books, viz, paper, boards, and cloth. The latter, notwith- standing the high duty now fixed upon it, is chiefly imported, as the manufacturers in this country have never been able successfully to com- pete with the foreign manufacturer. There is another, and to my mind a more important, reason why the duty on manufactured books should be maintained, and that is, that authors are likely to reside at the centers of the manufacture of books. If the duty were removed, the manufacture of books for this market would largely be in Germany and in England. This would compel the residence of even American authors, to a very large extent, abroad. We all know how much any person is influenced by the locality in which he resides, and this fact cannot fail to show itself in the character of the books written by such authors. The readers of books in this country are very largely young persons, and our institutions, both political and religious, and our modes of thought are radically different from those abroad. The effect, therefore, of removing this duty would be, prim arily, the manufacture of American books abroad; secondarily, their teaching principles of politics and religion and modes of thought alien to the theory of our institutions. To show what the effect of a high duty on the article of paper, which enters so largely into the production of a book, has been, I beg to call your attention to the fact that ordinary book paper before the war was 596 TARIFF COMMISSION. [H. O. HOUGHTON. 12J cents per pound, and in the early part of the war the duty was from 25 to 35 per cent. ; notwithstanding which fact, a good deal of paper was imported at that time. However, the duty has effectually protected the manufacture of paper here, and the result now is that we have a better quality of paper than is made in England, and the price of or- dinary book paper which was 12 J cents in I860 is now 7 J to 10, so that the consumers have largely derived the advantage of the extreme pro- tection, if you please to call it so, of paper-makers. J. U. SARGENT.] REDUCTION OF DUTIES. 597 J. B. SARGENT. Long Branch, N. J., August 22, 1882. Mr. J. B. Sargent, of New Haven, Conn., a manufacturer of shelf hardware, appeared and made the following statement: Gentlemen : An active business experience of nearly forty years, thirty of which have been occupied in manufacturing, a fair actual acquaintance with, and knowledge of, the natural resources of this country and of most of the countries of Europe, an examination and comparison of the methods of the United States and European manu- facturers and their respective facilities, advantages, and disadvantages, has convinced me that the United States of America is fully capable of taking and maintaining an independent position as a manufacturing nation, and that her manufacturers, if left to fight their own battles against all comers, in a free-trade field, need no protection whatever against foreign manufacturers. The fact that they are nov able to sell, to some little extent, their manufactured goods in neutral countries against the competition of the manufacturers of Europe, is evidence of what they might do if relieved of the incubus of an enormous customs tax on the foreign raw materials they use, and the correspondingly high price of American raw mate- rials that they are compelled to use. Under our tariff system, which is called “the protective system,” an attempt is made from time to time to adjust the duty on the various articles of foreign manufacture to conform to the supposed necessities of the American manufacturer of similar articles, and as the duty on one article is raised to meet the necessities, or more likely to protect the ignorance and unthrift of the American manufacturer, other manufac- turers, imagining that the cost of making their own goods, or the cost of the living of themselves and their employes has been increased by this advance in the tariff, combine and obtain an advance in the tariff on the classes of goods made by them. Then the producers of the raw material think there is an opportunity for them. to get the duty on their products raised (the order of proceed- ings is sometimes reversed), and so the figures have climbed upward, by a step here and another there, and then a good pull altogether, till we have built a tariff wall around us that not only keeps nearly all foreign raw material and manufactured goods out of the country, but keeps nearly all of our manufactured goods at home, and so circum- scribes our market, dwarfs American commerce, and suppresses nearly all possible material for commerce, except the products of our soil that may be wanted abroad. Is it not time now that we all take a few long steps downward — nearer terra firma — and get into a condition to have a foreign commerce? This country is so rich in fertile lands, on which can be cheaply raised all kinds of produce necessary for the sustenance of man and beast, and all the raw materials necessary for clothing, it is so rich in the ores of all the useful metals and in the coal to convert them, that surely no product of the soil, nor of animals supported on the product of the soil, nor mineral 598 TARIFF COMMISSION. [J. B. 8 ARGENT. ore, nor metal from tlie ore, can need the protection of a revenue tariff. These raw materials are placed by a kind Providence almost in the pro- ducer’s hands, and fortunate should they esteem themselves who have, at so little cost, become the owners of the fertile lands and rich mines from which these raw materials are so easily obtained. The workingman certainly needs no protection on his labor, provided he can get his food and clothing and all the articles that enter into the subsistence of himself and family free from the high prices influenced or induced by a high tariff, and even if he does need protection he cannot get it, because if the laborer tries to make a “ corner” in the price of labor, importations of foreign labor come in without limit and duty free. There is n# revenue tariff to protect the wages of the mechanic, the clerk, and the workingman. With raw materials free of duty, labor free of duty, and freights and other expenses on a free- trade basis, the manufacturer will need no pro- tective tariff, but, I am sure, can not only hold all he ought to hold of the home market but obtain a large share of the foreign markets. It is true that with free trade some unhealthy manufacturing plants, where an unwise attempt has been made to manufacture some particular article that can be manufactured in this country only at great disadvan- tage, or that can be manufactured in some other country under great and peculiar advantages, must wilt; but it is better for the country that the few such schemes unwisely projected should fail than that all the people should forever be taxed to support those manufacturing establishments that must inevitaby be operated at a great disadvantage as compared with similar establishments under more favoring circumstances in other countries. No one country should try to produce and manufacture •everything it needs. If that were possible and were carried into effect, there would be no commerce and no peaceful inter-communication among nations and peoples. Since the decline in prices in and following the “ panic” of 1873, when the price of raw materials went down with the price of manufactured goods, manufacturers needed no protection till the later advance in raw materials. Following that “panic” the exports of manufactured goods became quite important in amount and fairly profitable to the manufac- turers till the beginning of the “corner” in iron, called the “boom,” When, by the manipulations of the iron men combined with the specu- lators, protected and aided by a high tariff*, a “corner” was made in iron, running up the price here to more than twice the price in Europe, and To nearly three times the average price in that market. Other raw ma- terials and merchandise, and the cost of living, fell into line in this •country, and as a-consequence the exportation of manufactured goods almost ceased. By combinations and division of business among the producers of pig iron, bar iron, steel, and other metal products, by lock-outs and fomen- tations of protracted strikes, and by the help of a tariff of from 50 to 250 per cent., all the metals and the immediate products of metals that are produced in this country are nearly twice as high here as in Europe. How can it be expected that American manufacturers should be able to sell their goods in foreign countries when their raw materials costs so much more than their English and German competitors pay for the same The present fictitious prices of pig and bar iron in this country enable plants that are worked 1 ) 3 ' old expensive processes, and with machinery all out of date, to make large profits, and those establishments for the production of pig iron, bar iron, steel, and copper, that have good J. B. S ARGENT.] REDUCTION OF DUTIES. 599 modern improvements, pile np immense and illegitimate gains out of the productive energy of the country and the people, who are enslaved, in this respect, by the present protective tariff. With the price of American copper in this country five cents per pound higher than in England and Germany, how can the American manufacturer of brass goods export them in competition with English and German manufacturers? There was a short time when American manufacturers could buy American copper in London at the London market-price and import it, free of duty, as a product of the United States, and in original pack- ages, but the protected copper miners and smelters discovered the plan, and European consumption must now be guaranteed by the foreign buyer of American copper as a part of the bargain. And so the Amer- ican manufacturer is protected five cents per pound out of pocket on what is used in this country, and he is substantially estopped from manufacturing copper or brass goods for export. The immigration into the United States is so large, and is so largely composed of mechanics, either skilled or unskilled, and of laborers, who rapidly become, first unskilled and then skilled mechanics, and crowd into factories, that it is important to make employment for them by an increase of manufactures. There is already a surplus of manu- facturing establishments in most branches, if confined to the wants of the home market at the necessarily prevailing present high prices, based on protected raw materials : and but little export business can be done, except in a few novelties and specialties, in competition with foreign manufacturers using duty-free raw materials. We should contrive some way in which to reduce prices, not only for export, but for consumers in the United States. A reduction of prices would largely increase consumption at home and for export, would employ a largely increased number of mechanics, laborers, agents, and clerks, and would immensely increase the con- sumption of raw materials. Prices being lower in all departments, the producers of raw material would be able, not only to make a legitimate percentage of profit, but, as I believe, would in the aggregate make larger permanent gains than under a high protective system. A sudden change from a high tariff to free trade would be likely to unsettle prices so suddenly as to create commercial disturbance, al- though the country at large, and all companies, firms, and individuals not burdened with debt, would be as rich with prices low as with prices high ; for it is the amount of property that indicates a country’s or an individual’s wealth, and not the temporary or fictitious valuation of it measured by the fictitious valuation of other property. A house that shelters the family of the workingman shelters his family exactly as well at a low solid valuation as at a high fictitious valuation, and his taxes are likely to be less. The manufacturer’s plant will produce quite as many goods at alow valuation of the plant as at a high valua- tion, and if low cost of production and low selling prices increase de- mand, as is the law of business, then he will have need to increase his plant and employ more labor. Therefore, to the end that manufactures may be increased, that the de- mand for American raw materials may be increased, and that skilled, unskilled, and common labor may be fully and permanently employed, and the cost of subsistence of all classes reduced, I respectfully ask you to recommend to Congress that the tariff laws be so amended that (excepting articles which, if of United States production, would pay an excise or internal- revenue duty) nothing shall pay a duty of over 25 600 TARIFF COMMISSION. [J. B. SARGENT. per cent, on the value at the last place of export, and that the tariff on all articles not now paying so much as 25 per cent, shall remain as now ; provided, however, that after the amount of duty shall have been as- sessed on the imported merchandise at the proper rate as above stated, and the account made up for the respective classes (if at more than one rate of duty), a sum equal to the legitimate, proper, and actual freight paid, or to be paid, on said merchandise Irom the foreign ship- ping port to the United States port of landing, shall be deducted from the sum of the duties, and the importer shall pay the remainder only ; and provided further, that nothing in this amendment shall release the importer from paying the customary and lawful charges, fees, and costs as heretofore. I am aware that under this provision very coarse articles of raw ma- terial, such as iron ore, would be duty free, as they ought to be. I am also aware that the coarser the article, and the nearer to the condition of crude raw material, or in other words the less the labor upon the article the nearer the free list. But in this way, the avowed object of a protective tariff', the protection of American labor, would be more nearly gained, as the further advanced the article is by the hand of la- bor the greater is the percentage of the value of the labor m the arti- cle over the percentage of the value when taken in its crude condition from nature. The freight to this country from the place of production in the foreign country is all the protection that should be asked for articles of raw material produced here. There can be no difficulty in arriving at the correct amount of freight from a foreign port, as the customary rate is usually well known. It may be sworn to, and a consul’s certificate may be required as in the valuation of the merchandise at a foreign port of shipment. Until the cost of raw materials and manufactured goods in the United States can be reduced, all attempts to build up a respectable United States commercial marine will be futile. Under existing circumstances, it is folly to talk of steamship lines running direct between the United States and Australia, between the United States and South America, or between the United States and any other purely agricultural country. We might buy the steamships in Europe, but we cannot furnish the outward cargo of manufactured goods. Under existing circumstances, Europe must furnish the outward cargo to be exchanged for the wools, hides, woods, gums, coffees, and other agricultural products of those countries, bring to the United States what of those products are needed here, and take in exchange American agricultural produce for Europe. Very few United States manufactured goods enter into this commerce, and the few that do must go via Europe. The starting point in the circular or triangular trip must be the free-trade or low-tariff country that can fur- nish the manufactured goods at the requisite price. By Commissioner Kenner : Question. You have stated that certain manufactured articles are being exported from the United States; can you enumerate those arti- cles? — Answer. We exported quite a large variety of hardware at one time, even to Germany and to England — builders’ hardware. Q. Also textile fabrics? — A. I am not so familiar with those. I am a manufacturer of shelf hardware. I employ under my own supervision in that business fully 1,500 hands, and I have to meet as severe a com- petition, probably, as exists in any line from the manufacturers in Bir- mingham and in Germany. J. B. SAKGENT.] REDUCTION OF DUTIES. 601 Q. Has there ever been a time since you began manufacturing those articles when they were not more or less protected by our tariff? — A. They have been protected more or less all the time. Q. Could you have attained the excellence you have attained in the manufacture of those articles, which enables you to ship them to Europe in competition with manufacturers there, if there had not been a pro- tective tariff? — A. lam inclined to think we could. Whenever there has been a high tariff on the raw materials, that has been an injury to the trade. Q. But my question is whether you would have been able, without any protection from the time you started up to the present day, to have attained such excellence in the manufacture of those articles as to have been enabled to ship them profitably to a European market? — A. That is a very difficult question to answer. My own opinion, however, is that we should have begun to export earlier than we have done. Q. Then you think that you would have prospered more without a tariff than with one? — A. I think we should, with free trade in the raw materials at the same time. Q. You have laid down the proposition here that no nation ought to desire or try to manufacture everything it needs ? — A. Yes. Q. Do you think that remark applicable to the United States, where we have every variety of climate and soil, extending north and south from Maine to Texas, and east and west from ocean to ocean? W r ith such a vast and varied territory and such great variety of soil and climate, why should we not desire to make everything we want ; and does jour proposition really apply to this country? — A. I think it does apply to the United States, for this reason : There are a great many articles which enter into commerce which, if made in every country, must be made in so small quantities as to be made at a great disadvan- tage. At the same time, there are in each nation peculiar advantages for the manufacture of certain articles, so that some articles can be made in almost every country cheaper than in any other. The manu- facture of crockery ware and pottery, for example, may be carried on, perhaps, to better advantage in New Jersey than in other places where the raw material is not so easily obtained, or where fuel is higher in price. Commissioner Kenner. I am asking these questions for information, because your point is a new one to me. I have been an agriculturist all my life ; I have always been told that it was better to make every- thing I required for consumption than to buy it ; and, therefore, I sup- posed that your proposition was not applicable to a country like ours. I can understand how it would be true of Switzerland or Portugal, or any other small country of limited extent and resources, but I do not see how it applies here. The Witness. It is a law of business, well known among manufac- turers, that, no matter how large the plant of any one manufacturer may be, it is better for them to subdivide the work among them and give to each manufacturer the making of a particular class of goods. The brass mills make brass and nothing else. It is better that all manufacturers should confine themselves to one branch, or to a few branches of manufacture, provided there is business enough of that kind to be done. It is better, even, that manufacturers should buy partially manufactured supplies from some neighboring manufacturer, or even from another country, rather than try to make everything themselves. Commissioner Kenner. Yes j I understand that principle. I know 602 TARIFF COMMISSION. |J. B. SARGENT. that it is better for a man to buy his shoes than to attempt to make them, if he is a professional man, or if his trade is that of a tailor ; but the question here is whether we had better buy from a neighbor or from a distant party in a foreign land. You have said that the manufactures of the North would be able to exist on their own basis without any tariff protection, but do you think the same is true of the manufactures of the South, which are merely beginning? The Witness. I did not say the manufactures of the North; I said the manufactures of the country. Commissioner Kenxer. Well, that means, practically, the manu- factures of the North, for it is only at the North that manufacturing has been established to any great extent up to this time. The Witness. The manufactures of the South need protection, if they need any at all, not against European manufacturers, but against the manufacturers of the North. The manufacturers of the North will be very much severer competitors with the manufacturers of the South than those of Europe ever can be. Commissioner Ambler. Why ? The Witness. For the reason that we are nearer to the customers of the Southern manufacturer than any European manufacturer is; we can supply them quicker; we can keep informed of the wants of the Southern consumer, and adapt our manufactures to those wants very much more easily and quickly than the manufacturers of Europe can possibly do. Commissioner Ambler. Are we commercially nearer the South than Europe is? Of course we are nearer as to time and as to miles, but are we in fact commercially nearer? Are freights less, or more, be- tween Europe and the bulk of our Southern country than between the Eorth and the same region? The Witness. They certainly would be less between the North and the South if we had free trade in ships. Commissioner Ambler. Why? The Witness. Because the voyage from New York to Charleston or Savannah, or the voyage down the Mississippi Biver from Pittsburgh or Saint Louis, is very much safer, quicker, and cheaper than the voyage from Europe. Commissioner Ambler. That is to say, certain favored points in the North are nearer to the South. The Witness. Those are the points from which the South would be likely to draw its supples. The manufacturers of the North, let me say, would be glad to see manufacturing establishments grow up in the South. There is no feeling of rivalry among Northern manufacturers toward the manufacturers of the South — certainly none in the branch that I am engaged in, nor, I think, generally; because everything in the South, or in the West, that tends to increase the industries, and the popula ion and the wealth of those portions of the country, necessarily increases their demand for our manufactured goods. Commissioner Ambler. I understood you to say that the real cause of your being unable to compete with the world in your particular line of goods is, in your judgment, the tariff on raw materials. The Witness. That is the cause in part. Another cause is the higher price of labor in this country, caused by the higher cost of living. Commisioner Ambler. You say “ caused by the higher cost of living.” Do you mean by that a higher cost for the same grade of living. The Witness. I think so. J. B. SARGENT.! REDUCTION OF DUTIES. 603 Commissioner Ambler. Is it not a fact that our working people gen- erally live much better than working people in European countries? The Witness. Well, I cannot admit that tlie workingmen of this coun- try universally live better than the workingmen of Europe. Commissioner Ambler. That would be, perhaps, asking too much. I did not say universally, X said generally. The Witness. Well, I have been a good deal among the working classes of England and Germany, and although in some respects they live more poorly than our working people, still, in all that are by them esteemed the necessaries and comforts of life, they do live generally as well as the workingmen of this country. Commisioner Ambler. You say 11 by them esteemed the necessaries.” I do not quite catch your idea. The Witness. For instance, they do not care for carpets over there, as our working people do. Commisioner Avibler. They don’t care for meat over there, either, as our workingmen do. The Witness. No. Commissioner Kenner. Do you mean that they do care for it, or that they do not get it? The Witness. They do not get it. Commissioner Kenner. Don’t you suppose that the workingmen of Europe would like to get meat if they could ? The Witness. Well, they do get it, but they are more economical in the consumption of meat than our people. Commissioner Kenner. Is not that economy forced upon them ? The Witness. I don’t know whether it is or not, but such has been the habit of the people there from time immemorial. Even in agricul- tural countries in Europe, among the peasantry, where there are no manu- factures, meats are scarce and higher than they are here, and so are all kinds of animals — horses for instance. That is, perhaps, largely due to the devastation produced by European wars and the vast number of animals used by the standing armies of Europe. Commissioner Oliver. You say you are engaged in manufacturing hardware largely in New Haven? The Witness. Yes, sir. Commissioner Oliver. You originally imported such goods at New York, I believe ? The Witness. No, sir; we have scarcely ever imported anything. We have dealt always in American manufactures. Commissioner Oliver. You have spoken of American manufacturers, when prices were low, exporting goods to England ; don’t you consider that the reason they were able to export those lines of goods was that we had better mechanics and better machinery in this country, and that the reason we had better machinery was because the necessity for it existed here on account of the higher price of labor? The Witness. I have no doubt that in most lines of manufacture we have better machinery. Commissioner Oliver. The average European wages does not exceed 50 or GO or 75 cents a day, so that the necessity for improved machinery is much less there than it is here; but in this country, where the price of labor is so high, the necessity for improved machinery was found to exist, and you New England people created it, did you not? The Witness. We have created a good deal of it. Commissioner Oliver. With labor as cheap as it is in Germany, one or two marks a day, or as cheap as it is in England, two shillings or 604 TARIFF COMMISSION. [J. B. SARGENT. two shillings and a half, would the improved machinery that you now possess have been created? The Witness. I think it would. I think, in the first place, that the composite character of the people of the United States has had a great deal to do with that matter. Commissioner Oliver. But was not the great incentive to the rapid improvement of machinery the high price of labor? Was not that the main inducement, originally, to incur the expense of making such im- provements? The Witness. It is due to competition not only with Europe but among ourselves. It is the interest of every manufacturer, and always will be, to improve his machinery. Commissioner Oliver. Was it not the possession of this improved machinery, together with originality of design, which enabled you to export those lines of builders’ hardware of which you have spoken? The Witness. In part. Commissioner Oliver. Did you not find that when you did export those goods the European manufacturers began imitating them? The Witness. Not very much. They do take up our patterns some- times and imitate them. Commissioner Oliver. As a manufacturer you favor a gradual re- duction of duties to 15 or 20 per cent. You are manufacturing in Con- necticut ; now is not your labor there very much cheaper than it is in- land, in Cleveland or Chicago, for example? The Witness. I don’t tbink it is. Commissioner Oliver. Don’t you get advantage of the cheaper labor as it comes to the seaboard ? The Witness. I think not. Commissioner Oliver. It is the general opinion throughout the coun- try that labor is lower near the seaboard than it is in the interiqr, on ac- count of the great yearly supply from immigration. The Witness. I do not think it is lower here. A very large propor- tion of the immigration goes immediately to the West. Commissioner Oliver. But you have the first chance at it. Is not the average rate of wages lower in New Haven than it is in Cleveland, Cincinnati, or Saint Louis, which are all hardware manufacturing points ? The Witness. I think not. It is our experience that of the work- men who go out there many soon return to the East, saying that they cannot do as well in the West as in the East. I have often had such instances among my own men. Commissioner Oliver. Cleveland, Columbus, Cincinnati, and Saint Louis are all hardware manufacturing points, and are pretty fairly situ- ated for the business, are they not? The Witness. They are. Commissioner Oliver. If your large factory was located at either of these points, or at any other point west of the Alleghany Mountains, would you advocate this reduction of duties which you now advocate? The Witness. I certainly should. Commissioner Oliver. Would not the reduction which you advocate give you in Connecticut the advantage of cheaper foreign pig iron, and cheaper coal from the British provinces (getting it on tide- water), and is not that the main reason why the manufacturers on tide- water desire the duty on crude materials reduced ? The Witness. I hardly think that there is any foreign coal used in this country. Commissioner Oliver. I only used coal as an illustration. My point J. B. SARGENT.] REDUCTION OF DUTIES. 605 is that the interest of the manufacturer on tide-water is to have the duties on crude materials decreased, so that he can have the advantage of buying his materials abroad. The Witness. I have no doubt that benefit would accrue to the west- ern manufacturer, as well as to the eastern, from the proposed change, for the reason that pig iron or other raw material coming in here would have its influence upon the prices of raw materials further west. Then, too, the freight from the seaboard to the West is very light.- Commissioner Oliver. And the freight from England or Germany to New England is very light. The Witness. The freight on pig iron has been from $2.50 to $3 for several months. Commissioner Oliver. This last year has been an exception, on ac- count of the short crop, but the average freight has not been over six or eight shillings. Is not that the fact? The Witness. It varies, of course. Comnfissioner Oliver. Following out your argument, would you pro- pose that the duties on general hardware be taken off? The Witness. I would make a level rate of 25 per cent, ou everything, of whatever nature, that is now taxed at that rate or above it, and allow from that duty the freight from the foreign point of shipment to the United States. Commissioner Oliver. There is no doubt that the price of labor in the manufacturing districts of Germany to-day does not rise above 2 marks, that is, about 50 cents, and it is lower still in Belgium and France. Now t , what I want to get at is this : Yre you prepared to-day to come down and leave only the margin of 15 or 20 per cent, between that cheap European labor and the prices which you pay to-day, which I judge will average about three times as much? I speak, of course, of adult labor, not of boys or girls. The Witness. I certainly am prepared to do it, and I should welcome the change. From our experience in exporting such goods as we can export in competition with the European manufacturers, I am fully con- vinced that we can export very largely under a system of absolute free trade. Commissioner Oliver. Of what extent are those European markets for your line of goods, compared with our home market? The Witness. We have the markets of Southern Europe — the Med- iterranean countries. Commissioner Oliver. But do they compare at all in extent with the markets of our own Western States? The WTtness. They are not so much. Commissioner Oliver. Is it not a fact that your firm lias been very successful in originating novel and handsome designs for hardware? The Witness. We have not been specially so. Commissioner Oliver. That is your general reputation, I think. The Witness. We have not been sleeping, of course, but there are others who have done quite as well in that respect. Commissioner Oliver. You have made great improvements in your line of manufactures, and so have found a market for your goods, but what effect would the radical change which you wish have upon the bulk of the hardware manufacturers along the seaboard? The Witness. I think they would generally be more benefited by the low price of raw material than we would be. Commissioner Oliver. Eventually perhaps they would, but would there not be an interim in which they would have great trouble? 606 TARIFF COMMISSION. [J. B. SARGENT. The Witness. I think not. Commissioner Oliver. Would there not be an interim between the ‘‘evening up” of the low wages' abroad and our comparatively high wages here? The Witness. I think that a reduction of duties to 25 per cent, on everything, including manufactured goods and raw material, less the freights, would have an immediate effect to cut down the profits of the manufacturers to some extent, and then gradually, as the price of liv- ing would be reduced, it would have the effect to reduce the price of labor; but that would be no disadvantage to the laborer, and I think it would be a vast benefit to the great consuming masses of this country, the farmer, the clerk, the professional man, the retired capitalist, widows and orphans, and all who live upon interest. Commissioner Ambler. It would undoubtedly be an advantage to everybody who lives upon a fixed income to buy his labor and every- thing else in the cheapest market he could find. Professional gentle- men we can perhaps afford to let take care of themselves while we look after the interests of the others. Now, are you able to give us any idea of the proportion which the raw material which you use in your manufac- tures bears in cost to the labor that you put upon it? The Witness. It varies so much that I should be timid about giving any figures of that kind. Commissioner Ambler. Perhaps until you are prepared to give fig- ures upon that subject there may be some liability to mistake as to what is the real trouble in the case — whether it is owing to the high wages that you pay or the cost of material — may there not? The Witness. Well, sir, without being able to go into details just now, I can only say that I am perfectly satisfied as to where the trouble is, and I am fully convinced that the price of labor would drop with the price of goods, and at the same time the cost of living would be re- duced. Commissioner Ambler. In other words, you would contemplate be- ing able to keep up your competition with foreign manufacturers, first, by a reduction of the cost of raw material, and, second, by a corre- sponding reduction of the price of labor. The Witness. Labor and all expenses. Commissioner Ambler. Well, “all expenses” is labor, in point of fact, is it not? It may be clerical, or it may be mechanical, labor, but it is still labor. The Witness. Yes. Commissioner Ambler. Then I am right in saying that you would expect to be able to compete in the markets of the world, first, by a re- duction in the cost of your raw materials, and, next, by a reduction in the cost of your labor. Now I understand you to say that that would be merely a nominal reduction to the laborer, because the cost of living would also be reduced. The Witness. Yes. Commissioner Ambler. You have had the advantage of seeing the laborers in portions of Europe; is it not a fact that, as a rule, the American laborer is better housed and has more comforts than the E u ropean laborer ? The Witness. I should hardly say that he has. The tenement houses of England are better than those of New York, and the houses occupied by the working classes of Europe are usually better than the houses of our working people; uot so “fancy” on the outside, but more solid, aud they rent lower. J. B. SABGENT.] REDUCTION OF DUTIES. 6 07 Commissioner Ambler. Do I understand you to say that your ex- perience leads you to the conclusion that, as a rule, the houses of the laboring classes in England are as good as, or better than, the houses of the laboring classes in this country 1 ? The Witness. In the manufacturing districts I think they are. Commissioner Ambler. Take the American manufacturing district which you are particularly acquainted with; how are the working people of New Haven housed as compared with the working people of Birmingham and Sheffield, for instance 1 ? The Witness. They are housed very differently, but no more com- fortably, I think. Commissioner Ambler. Which are the more expensively housed? I am speaking not about nominal but about actual cost. The Witness. As a rule the house itself, the building, is better in England, for it is usually built of brick, and here it is usually a cheap wooden structure, often two or three stories high, with a dozen or twenty families in the one house. Commissioner Ambler. Yes; in our larger cities there is often a duplication of tenants in the same house; but is there not the same state of things in Europe? The Witness. Not to the same extent. The houses there are usually smaller. Commissioner Ambler. Passing now from the house, the building itself, state, if you please, which is better furnished on an average, the American or the foreign workingman’s house. The Witness. The houses are better furnished in this country among the well-to-do classes. Commissioner Ambler. I am speaking of mechanics generally, of the man who makes his living by some sort of manual labor, and I in- clude in my question not only the skilled mechanic but unskilled laborer also. I want to get at a general average. The Witness. I think that on a general average the furniture of such houses in this country is better than the furniture of such houses abroad. Commissioner Ambler. I understood you to say awhile ago that you thought that foreign workingmen lived about as well as American workingmen. The Witness. Yes. Commissioner Ambler. According to your experience and observa- tion, what is the food of the ordinary laboring classes in England, for example ? The Witness. Of course my experience of their food is not very ex- tensive. Commissioner Ambler. I do not speak alone of your personal expe- rience; I want to get at your knowledge upon that subject, however obtained. The Witness. I am aware that foreign working people do not eat so much meat as Americans do, and neither do the wealthy classes. The midday meal all over England is a slice of cold corned beef or roast beef, with bread, and a mug of beer — no vegetables ; and it is the same among the working classes. Commissioner Ambler. Do you mean to say that among the working classes of England the midday meal generally includes meat? The Witness. I know that it does often, but it is not the habit of English workingmen, or employers either, to have such a variety of food as we have iu this country. They have no such variety of vege- 608 TARIFF COMMISSION. [J. B. SARGEXT. tables. Even at a first-class hotel there, you get perhaps two vegetables, while here you may get a dozen. Commissioner Ambler. In short, then, the working classes here do in fact live better than the working classes abroad, do they not? The Witness. Well, if the eating of more meat is living better, which I doubt, they do live better here than in Europe. Commissioner Ambler. You have stated that our working people have an advantage as to meat and vegetables, and you have failed to mention in what respect the workiug people of European countries live better than ours. Please give us that information now. The WYtness. It is a question whether the variety of food that the American laborer or the American citizen, whether laborer or employer, is in the habit of eating is any better for him than the less variety which satisfies the foreigner. There is no doubt that the English working- man has fewer vegetables than the American has. England is not so prolific in vegetables as this country is. Commissioner Ambler. And if it were, the rate of wages paid to an English workingman would not permit him to buy them? The Witness. I don’t see much difference in that respect. Commissioner Ambler. We will pass now to another question. Taking the families of workingmen in both countries, which are best clothed ? The Witness. I don’t think there is very much difference in respect to that. English workingmen wear less showy clothing than our work- ingmen do, but their clothing is quite as substantial. Commissioner Ambler. Yes, they run to substantials over there; but I am asking not only about the English workingman himself, but about his family also. The Witness. It is true, I think, that very much more money is spent here in dress than is spent there. Commissioner Ambler. Very much more, even in proportion to the wages paid and the cost of clothing, is there not? The Witness. Yes, I think so. Commissioner Ambler. In which country have the working people the best opportunities for education? The Witness. The opportunities for education in England are -quite as good as here. The national schools of England are as good as our common schools, and in England they have compulsory education to a greater extent than we have it in this country. Commissioner Ambler. Perhaps that is because there is more neces- sity for it. I mean that the necessities of the workingman’s family there compel him to put his children to work younger than such children are put to work here, so that the government is compelled to interfere and compel the English workingman to send his children to school. Is not that the fact ? The Witness. I do not think it is. The tendency of parents every- where is to set their children at work at too early an age. We have compulsory education in Connecticut. We are not allowed to employ children under 14 years of age unless they have been at school at least three months during the year. That law was found necessary, because, owing, probably, to the carelessness of well-meaning employers, and the desire of parents to get some income from the labor of their children, they have been in the habit of setting them to work too young. It would appear, therefore, that the same necessity for compulsory educa- tion exists in this country as in England. Commissioner Ambler. And to as great an extent? J. B. SARGENT. J REDUCTION OF DUTIES. 609 Tlie Witness. I think so. We find very few people illiterate to the extent of being unable to read and write among the foreign laborers,, except among the Italians. There are very few such among the Ger- mans and English. Commissioner Ambler. The comparison that we have been endeavor- ing to make so far has been between this country and England. The Witness. Well, I think that as a rule the same is true of Ger- many. Commissioner Ambler. How is it as to France? The Witness. In France the people use more wine. They take their vegetable food in liquid state there. Commissioner Ambler. How is it as to Italy ? The Witness. There they live not so much on meats as upon soups, vegetables, and oils. Commissioner Ambler. Then as I get your idea in a general way, it is that the European workingman is quite as well off as the American workingman ? The Witness. I would not say that the European workingman is in all respects as well off* as the American workingman ; but I do not think that the difference is the result of free trade in Europe. Commissioner Ambler. Let us get the facts before we undertake to reason upon them. In what respect is the European workingman not so well off as the American workingman? The Witness. Well, he certainly does not live in all respects as well as the workingman lives in this country. That is true, however, more in regard to what are not considered essentials there, or even here — it applies more to unnecessary expenses — luxuries they may perhaps be called. Commissioner Ambler. Then the European workingman has fewer luxuries than the American ? The Witness. Yes; I think he has. Commissioner Ambler. Do you think it is desirable that the Amer- ican workingman’s luxuries should be curtailed? The Witness. I do not think it is desirable, and I do not think they would be curtailed by the change I propose. Commissioner Ambler. Then while you think that, as a general rule, the European workingman is as well off as the American with re- gard to the substantial of life, we are agreed that the workingman here has some advantage in the way of luxuries. Now, which accumu- lates most to provide for old age and its necessities, the English or the American workingman ? The Witness. I am not sufficiently informed in respect to that to be able to make any statement. Commissioner Ambler. Take New England, where you are ac- quainted. Is it a fact that the savings banks and the other institu- tions demonstrate to your mind that working people there make better provision for their future by savings than they do abroad ? The Witness. I presume so. Commissioner Ambler. Now we have got two things settled in re- spect to these people. First, our American workingmen live at least as well in regard to necessities, and they have more luxuries than the English workingman ; and, second, notwithstanding this increased ex- penditure, they save more for old age. These facts being so, does it not necessarily follow that the American working-man is better off than the English working-man? H. Mis. 6 39 610 TARIFF COMMISSION. [J. B. SABGENT. The Witness. Of course he is better off under all those circum- stances. Commissioner Ambler. And do you think it desirable that our work- ing people should be brought down to the plane that the English work- ers occupy ? The Witness. I desire to keep the workingman here in as good a condition as possible. Commissioner Ambler. That is to say, you, like every other respect- able and wellmeaning citizen, desire that the American workingman shall be as well off as he can be consistently with carrying on the busi- ness of the country. Now, with these differences which you admit do exist in favor of the American workman, do you think it possible to reduce his wages to the same actual value as the wages of the working classes in Europe, and at the same time to preserve to him the advan- tages that he now possesses ? The Witness. 1 think it is possible. Commissioner Ambler. Suppose that his wages have been brought down until they are upon exactly the same basis of actual value as the wages of the English workman, will not the result of the expenditure of those wages be precisely the same here as in England? When the wages of the American workman reach the same actual value as the English workingman’s wages, can he spend them so as to get more for them here than can be got for the same wages in England? The Witness. He would get more here than there with the same wages? Commissioner Ambler. Why ? The Witness. Because the wages of the workingman in this country are controlled, not by the protective tariff, and not altogether by the demand for labor in the factories, but by the rate of wages that the man can get or earn on our cheap lands. It is that which controls the price of labor in this country, and which will control it until our lands become as dear as those of Europe. So long as the products of the soil of this country can be raised on land costing not more than from $10 to $20 an acre, while the products of the soil in England aud Germany are raised on land costing five or ten times as much, the products which can be raised so cheaply in this country will necessarily be cheaper and more common among working people here than in England. But that is not due to the protective tariff, and it is not owing to the tariff that wages are higher here than in Europe. It is owing to our cheap and prolific soil. It is due also largely to the fact that this country does not take the products of the soil, the animals, and the vegetables and the grain from the laboring man and convert them to the uses of a standing army. We are apt to think that the wages of workingmen in this country are governed altogether by the tariff*, but it really has noth- ing to do with them. Commissioner Ambler. That statement opens up a new field for in- quiry, but it does not answer my question at all. I agree with you that our high wages are not caused entirely by the tariff*. I will not stop now to discuss the other questions which your remarks involve, but you have not even suggested an answer to my question. That question was this: If you reduce the prices of American labor to the same actual rate in value as the wages of the English workingmen, how will it be possible for the American workingman to expend the same amount of money in actual value and to get more for it? The Witness. 1 intended to say that the workingman can spend his J. B. SARGENT.] REDUCTION OF DUTIES. 611 wages to more advantage in tliis country, owing to the. fact that our fertile lands make the cost of living lower than in other countries. Commissioner Ambler. That is to say, the advantage, and the only advantage that the American workingman would have in the case which you put, would be that he might buy certain portions of his living cheaper, his breadstuffs, and his meat, and his vegetables. That is the extent of your proposition'? The Witness. That is the extent of it. Commissioner Ambler. Do you think that margin would cover the difference between the prices of labor in the two countries'? The Witness. I think it would. The actual difference between the wages of the workingmen of this country, and the workingmen of Europe is really quite small; although when accumulated and piled up in savings banks, the many littles become large. Under a system of free trade, the workingman on the land gets what he can for his labor on the soil, and whenever the workingman in the factory can do bet- ter by working on the soil, he does that and earns his living in that way instead of in the factory; and the manufacturer must always pay at least as much wages as the man could earn at agricultural labor, and probably a little more, in order to induce him to go into the factory; for I suppose that, in a natural condition, man prefers to work upon the soil rather than in the shop. I say, therefore, that the wages that a man can earn upon the soil of our cheap lands determines the rate of wages that must be paid by our manufacturers, and, in my opinion, the agri- cultural laborer should not be taxed in any way to support, at a higher rate of wages, the laborer in the factory. Commissioner Ambler. Undoubtedly he should not without receiv- ing some compensation. The Witness. Another point which I have not yet mentioned, and which illustrates the desirableness of free trade, is the advantage of having foreign markets, and a variety of foreign markets. This is an important point. The manufacturer in this country who confines him- self to one or two customers is liable to lose one of them and thereby to lose an outlet for half his goods, and it may take him a long time to find a new one. The manufacturers of this country who are confined to the market of this country have only one customer, and may in a time of serious depression find themselves without any; but if we had customers in all the nations of the earth we would not be restricted to any one market. Commissioner Oliver. In your opinion, would not the State of Illi- nois consume more of the line of goods that you manufacture than all Great Britain and Germany combined ? The Witness. Not at all. The home trade of England is very large, and the home trade of Germany is large also. We of course cater now to the wants of our home market. As we have no other market, we must not only supply the wants of our friends in Illinois and else- where at home, but we must try to increase them — as we do. Commissioner Ambler. Is it not a fact that, with all the hardships of the tariff which have been bearing upon you and upon this country generally, America is the best market in the world, in proportion to its population, for the goods which you manufacture'? The Witness. 1 suppose it is a fact beyond question that the fifty millions of people in the United States consume more manufactured goods than any other fifty millions of people on the face of the earth ; but that is not due, in my opinion, to a protective tariff. Commissioner Ambler. I did not ask that. I wish to make another 612 TARIFF COMMISSION. |J. B. SARGENT. inquiry. Is it not a fact that population increases in this country in a considerably greater ratio than the manufactures which are to supply that population ? The Witness. I don’t think it is. Commissioner Porter. During the last ten years, for instance, has it not been so? The Witness. In my own special branches the increase has been very large during the last ten years. I should say that within that time I have doubled my capacity for manufacturing. Commissioner Ambler. And at the same time that you have doubled your capacity you still keep the home market? The Witness. Yes ; we still keep the home market. J. II. BREWER. 1 POTTERY MANUFACTURES. 613 J. H. BREWER. Long Branch, N. J., August 22, 1882. Mr. J. H. Brewer, of Trenton, N. J., appeared before the Commis- sion, and, on behalf of the pottery manufacturers of the United States, made the following argument. Gentlemen : We are here representing the manufacturers of white and decorated crockery and china ware of the United States. We are delegated by this industry to present their argument for your fair and deliberate consideration. We are manufacturers of crockery, and have been thoroughly conversant with the business ever since the industry first blossomed into a commercial success, in 1863, under the incidental and accidental protection afforded by the gold premium; and just here we assert that our industry, practically, has never had any adequate protection since the gold premium receded and gold and paper money resumed their healthy relations. We take it to be unnecessary to argue the abstract question of protection. We conclude it to be the policy of this civil commission, in pursuance of the manifest wishes of the gov- ernment, to protect, absolutely protect, all industries needing the aid of tariff laws. ORIGIN AND PRESENT STATUS OF THE INDUSTRY. There was a pottery in South Carolina as early as 1765; established, as were the potteries of to-day, by English potters. At that time W edg- wood wrote to Sir William Meradith : This trade to our colonies we are apprehensive of losing in a few years. They are establishing a new pot-works in South Carolina. They have every material there, equal, if not superior, to our own. Here, then, we have had unused in the earth for over a century, in the State of South Carolina, as indeed we have in almost every State, simply for want of government protection, the prolific germs of an art at once useful and ornamental. The other attempts to manufacture white ware, at Philadelphia, Ben- nington, Vt., Jersey City, Greenpoint, East Liverpool, Trenton, and other places at different times, from 1765 to 1863, always resulted in puny and sickly ventures; neither quality nor quantity of goods being worth mentioning. Not so to-day. The value of white ware alone, made and to be made in the United States, in 1882, I estimate will amount to $5,299,140; capital invested, $5,076,000; wages, $2,387,000; material, $2,028, 950; employing about 7,000 hands. This industry is distributed throughout the United States, as fol- lows : © ^ • || © © S o ort foreign workmen to teach these details. Commissioner Boteler. Do you not think it would be a great benefit J. H. BREWER.] POTTERY MANUFACTURES. 627 to your manufacturers of pottery aud to the community to have con- nected with the normal school of your State an art department, to teach such things ? Mr. Laughlin. It certainly would. Mr. Brewer. That would be only following the lead of England and France in this respect. The managers of our decorative departments have graduated from some of the art schools in England, and have after- wards learned the art of decorating. Mr. Laughlin. We have to take the conditions as they exist. We have not got those art schools, so we have to offer foreign artists ex- traordinary inducements in order to persuade them to come here. Commissioner Oliver. Whatis the ordinary raw material — the clay — worth in its crude state when it reaches your factory? Mr. Brewer. The china clay is washed before it comes to us. It is worth from $15 to $17 a ton. Commissioner Oliver. What is the royalty that is paid for it in the ground ? Mr. Brewer. Fifty cents. Commissioner Oliver. Then the difference between 50 cents and $17 is for labor and transportation? Mr. Brewer. Yes, and profit. Our commoner New Jersey clay costs $0 to $8. And now, gentlemen, let me impress finally upon you the necessity of protecting the pottery industry as much as tbe most favored industry. No person at all familiar with the process of making pottery wares will say that this request is unfair or unreasonable. Having then, as we believe, a better case than any other American industry, we ask a duty equal to the most favored. Having reduced, by our competition, the prices of English wares 65 per cent, to consumers ; having millions of capital invested and thou- sands of operatives employed, as before mentioned in detail; having all the materials and advantages necessary to the development of this great industry, if adequately protected ; having an industry where 90 per cent, of the cost of production consists of labor ; having labor over 100 per cent, higher than those competing for this market; having an industry overlooked in the formation of the tariff* of 1861, because of its insignificance at that time ; having au industry created wholly by the gold premium of former years; let us make the conditions of this industry in the United States equal to the conditions abroad; let us place this industry in the class of American industries requiring the highest rate of duty. This done, and we will manufacture, in ten years, $20,000,000 of pot- tery, both china and earthenware, plain and decorated, cheaper than we would otherwise obtain them, and that, too, by American workmen, on American soil, from American material. Exhibit 1. Regular Assorted Crate W. G. sold in 1852. 4 4 6 4 6 24 dozen W. G. plates, 4, 5, 6, 7, 8, $19 20 $0.55 $0.65 $0.80 $0.90 $1.00 i i 1 i i 1 i 2£ dozen W. G. dishes, 8, 9, 10, 11, 12, 14, 16, 10 75 $2.25 $3.00 $3.75 $4.50 $6.00 $7.50 $10.50 628 TARIFF COMMISSION. [J, H. BREWER. £ £ £ £ £ 2£ dozen W. G. bakers, 6, 7, 8, 9, 10, $10 12 $2.25 $3,00 $4.00 $5.00 $6.00 £ £ £ 1 dozen W. G. covered dishes, 8, 9, 10, 9 00 $7.50 $9.00 $10.50 £ dozen W. G. sauce tureens, complete, at $10.50 1 75 £ dozen W. G. sauce boats, at $2.50 1 25 £ dozen W. G. pickles, at $2.25 1 13 £ dozen W. G. covered butters and drainers, at $7.50 2 50 £ £ £ 1 dozen W. G. teapots, sugars, creams, 3 48 $0.40 $0.30 $0.17 1 gross W. G. teas, unhandled . 5 00 £ gross W. G. teas, handled, at $6.50 3 25 £ gross W. G. coffees, handled, at $9.00 4 50 £ gross W. G. coffees, unhandled, at $6.50 3 25 £ £ £ 2 dozen W. G. jugs, 30, 24, 12, 6, 8 62 $2.50 $3.50 $4.50 $6.75 £ dozen W. G. ewers and basins, 9\s at $10.50 „ 3 50 £ dozen W. G. covered chambers, 9’s, at $10.50 3 50 £ 1 £ 2 dozen W. G. bowls, 24, 30, 36, 2 50 $1.50 $1.25 $1 2 2 £ dozen W. G. covered soaps, covered trays 2 00 $0.50 $0.50 95 30 Exhibit 2. Regular Assorted Crate W. G. sold in 1864. 4 4 6 4 6 24 dozen plates, 4, 5, 6, 7, 8, $43 75 $1.25 $1.50 $1.87 $2.00 $2.25 £££££££ 2£ dozen dishes, 8, 9, 10, 11, 12, 14, 16, 24 50 $4.50 $6.00 $7.50 $12.00 $13.50 $18.00 $24.00 £ £ £ £ £ 2£ dozen bakers, 6, 7, 8, 9 10, 19 50 $4.50 $6.00 $7.50 $9.00 $12.00 £ £ £ 1 dozen covered dishes, 8, 9, 10, 19 50 $16.50 $18.00 $24.00 £ dozen sauce tureens, complete, at $21.00 3 50 £ dozen sauce boats, at $7.50 3 75 £ dozen pickles, at $4.50 2 25 £ dozen covered butters, at $15.00 5 00 £ £ £ 1 dozen teapots, sugars, creams ._ 9 00 $1.00 $0.87 $0.38 1 gross teas, unhandled 12 00 £ gross teas, handled, at $13.50 6 75 £ gross coffees, handled, at $21.00 10 50 £ gross coffees, unbundled, at $18.00 9 00 J. H. bkeweb.] POTTERY MANUFACTURES. 629 £ £ £ £ 2 dozen jugs, 30, 24, 12, 6 - $15 75 $4.50 $6.00 $9.00 $12.00 £ dozen ewers and basins, 9’s, at $30.00 10 50 £ 1 £ 2 dozen bowls, 24, 30, 36, 6 00 $4.00 $3.00 $2.00 2 2 £ dozen covered soaps, covered trays 4 00 $1.00 $1.00 £ dozen oovered chambers, 9’s, at $18.00 * 6 00 210 75 Exhibit 3. Regular Assorted Crate W. G. sold in 1872. 4 4 6 4 6 24 dozen plates, 4, 5, 6, 7, 8, $27 80 $0.90 $1.05 $1.15 $1.25 $1.35 £ £ £ £ £ £ £ 2£ dozen dishes, 8, 9, 10, 11, 12, 14, 16, 17 66 $4.50 $5.50 $6.50 $7.80 $9.00 $12.00 $16.00 £ £ £ £ £ 2£ dozen bakers, 6, 7, 8, 9, 10, 15 30 $4.00 $5.00 $6.00 $7.20 $8.40 £ £ £ 1 dozen covered dishes, 8, 9, 10, 16 13 $14.40 $16.00 $18.00 £ dozen sauce tureens, complete, at $16.20 2 70 £ dozen sauce boats, at $4. 50 v 2 25 £ dozen pickles, at $3.00 - 1 50 £ dozen covered butters, at $9. 00 3 00 £ £ £ 1 dozen teapots, sugars, creams, 5 64 $0.60 $0.56 $0.25 1 gross teas, unhand led, at $7.00 7 00 £ gross teas, handled, at $9.00 4 50 £ gross coffees, handled, at $11.00 5 50 £ gross coffees, unhandled, at $9.00 4 50 £ £ £ £ 2 dozen jugs, 30, 24, 12, 6, 12 50 $3.75 $5.25 $7.00 $9.00 £ dozen ewers and basins, 9’s, at $16.80 5 60 * £ l £ 2 dozen bowls, 24, 30, 36, 4 50 $2.75 $2.25 $1.75 2 2 £ dozen covered soaps, covered trays, 3 00 $0.75 $0.75 £ dozen covered chambers, 9’s, at $12.00 4 00 630 TARIFF COMMISSION. [J. H. BREWER. Exhibit 4. Regular Assorted Crate W. G. sold in 1875. 4 4 6 4 6 24 dozen plates, 4, 5, 6, 7, 8, $26 20 |0.85 $0.95 $1.10 $1.15 $1.30 £ £ £ £ £ £ l 2 % dozen dishes, 8, 9, 10, 11, 12, 14, 16 15 21 $3.00 $3.50 $4.50 $6.75 $9.00 $12.00 $14.00 ' £ £ £ £ £ 2£ dozen bakers, 6, 7, 8, 9, 10, 13 25 $2.50 $4.00 $5.50 $9.50 $8.00 £ £ £ 1 dozen covered dishes, 8, 9, 10, 13 83 $12.00 $13.50 $16.00 £ dozen sance tureens, complete, at $13.50 2 25 £ dozen sance boats, at $4.00 2 00 £ dozen pickles, at $2.50 1 25 £ dozen covered butters, at $8.40 2 80 £ £ £ 1 dozen teapots, sugars, creams - 5 00 $0.55 $0.50 $0.20 1 gross teas, unhandled 7 20 £ gross teas, handled, at $8.40 4 20 £ gross coffees, handled, at $10.50 5 25 £ gross coffees, unhandled, at $8.40 4 20 £ £ £ £ 2 dozen jugs, 30, 24, 12, 6, 12 50 $3.75 $5.25 $7.00 $9.00 £ dozen ewers and basins, 9’s, at $15.00 5 00 £ 1 £ 2 dozen bowls, 24, 30, 36, 3 87 $2.25 $2.00 $1.50 £ dozen covered chambers, 9’s, at $9.60 3 20 2 2 £ dozen covered soaps, covered trays 2 40 $0.60 $0.60 129 61 Exhibit 5. Regular Assorted Crate W. G. sold in 1877. $110 10. Exhibit 6. Regular Assorted Crate, either English or American, W. G. sold in 1882. $27 60 11 78 24 dozen plates, 2£ dozen dishes, 4 4 6 4 6 4, 5, 6, 7, 8, ).80 $0.90 $1.10 $1.30 $1.50 £ £ £ £ £ 8, 9, 10, 11, 12, £ 14, £ 16, $2.00 $2.50 $3.60 $4.75 $6.30 $9.00 $14.40 j. h. brewer.] POTTERY MANUFACTURES. 631 £ £ £ £ £ 2 £ dozen bakers, 6, 7, 8, 9, 10, $9 02 $1.75 $2.40 $3.50 $4.00 $5.80 £ £ £ 1 dozen covered dishes, 8, 9, 10, 6 67 $9.00 $10.00 $11.00 £ dozen sauce tureens, complete, at $13.50 2 25 £ dozen sauce boats, at $3.20 1 GO £ dozen pickles, No. 2, at $3.00 1 50 £ dozen covered butters, at $7.00 2 33 £ £ £ 1 dozen teapots, sugars, creams 5 09 $0.58£ $0.48 $0.21 1 gross teas, unhandled 8 50 £ gross teas, handled, at $10.00 5 00 £ gross coffees, handled, at $12.00 6 00 £ gross coffees, unhandled, at $10 5 00 £ £ £ £ 2 dozen jugs, 30, 24, 12, 6, 9 30 $2.50 $3.00 $5.10 $8.00 £ dozen ewers and basins, 9’s, at $16.50 5 50 £ dozen covered chambers, 9’s, at $10.25 3 42 £ 1 £ 2 dozen bowls, 24, 30, 36 3 05 $1.85 $1.50 $1.25 2 2 £ dozen covered soaps, covered trays 2 16 $0.54 $0.54 115 77 Less 50 per cent, (regular discount) 57 88 57 89 632 TARIFF COMMISSION. [JAMES M. CONSTABLE. JAMES M. CONSTABLE. Long Branch, N. J., August 22, 1882. Mr. James M. Constable, of New York, importer and dealer in dry goods, appeared before the committee and made the following statement : I wish to speak for the manufacturer, the importer, and the poorer classes of this country. For the manufacturer 1 want wool and raw material of every kind free of duty. Our trouble in this country to-day is that we can manufacture more than we can wear, and until we have freer raw materials we can never be exporters. We are eating each other up. We require access to foreign markets. My impression is that for the last twentv years the wool growers have not been bene- fited by the tax on foreign wools. I think that if an accurate estimate be made of the gold value of wool for the last twenty years and its gold value prior to the war, it will be found that wools have been cheaper for the last twenty years than before that time. One of the largest manufacturers in this country told me, not long since, that with free wool and free raw materials generally he did not want any tariff at all. I wish to speak also for the merchants. They want a lower tariff, simple and plain. Under the present system, when a merchant sees a sample of goods he does not know what the duty is to be. In cotton goods, particularly, even the experts at the custom house are often puzzled. I waut to speak, too, lor the poorer classes of the country, these fifty millions of people who have been taxed for the last ten years 20 or JO or 40 per cent, more than they ought to have been taxed. If I had my way, I would abandon the present tariff altogether, which is filled with inconsistencies and absurdities of every kind. The tariff of 1844, made by Kobert J. Walker, was the best and fairest tariff ever made jn this country. I have brought with me here a statement of the tariff which I would recommend on dry goods, which I will read to the Commission, and afterward I shall be glad to answer any questions that may be put, as well as I can. 1 begin with cotton goods, of which we are large im- porters. The average duty on cotton goods to day is from 33} to some- thing like 40 per cent., the majority of cotton goods paying about 35 per cent. Some four years ago 10 per cent, was taken off tbe entire tariff, and none of the cotton manufacturers objected. They found they could get along very well with such a tariff. What 1 propose is that the tariff' on every description of cotton goods, including clothing in whole or in part made up, should be 20 per cent, ad valorem. On linens the present duty is from 35 to 40 per cent, ad valorem. I would advocate a duty of 25 per cent, on all manufactures of linen, flax, jute, hemp, or when mixed with cotton, including clothing in part or wholly made up. That would bring the duty only a trifle less than it was four years ago. On dress goods for women and children, and flannels composed wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, or silk, costing 15 cents or under per square yard, 0 eeuts per square yard and 10 per cent, ad valorem. On such goods costing over 25 cents per square yard, 8 cents per square yard and 10 per cent, ad valorem. I here advocate a double duty, because I think it is more just to the JAMES M. CONSTAHLE.] DRY GOODS. 633 poor man; and a custom-house examiner told me not long since that if it were not for the square-yard duty on German goods the government would not have got any duty on them at all. There is also another clause in the present tariff which is very objectionable, that if the fabric weighs over four ounces to the square yard it shall pay a pound weight duty in addition to the 35 per cent. That provision shuts out a great many coarse, comfortable, warm articles with which women and children might be clothed. Upon all other dress goods of whatever description, not otherwise provided for, composed wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, such as braid, bindings, fringes, cords, tassels, embroideries, wools and worsteds, laces, inser tings, shirts, draw- ers, hosiery, clothing in whole or in part made up, and all articles known as small wares, I should recommend a duty of 25 per cent, ad valorem. These small articles cannot be covered in any other way; but, under the present tariff, to collect an ad valorem duty honestly is impossible. Under-invoicing is carried on to such a great extent that the honest American importer has no chance against the foreign man- ufacturer. I come now to wool and worsted fabrics. In the present tariff, the discrimination between wool and worsted, as to where one begins and the other ends, is very difficult to make, and therefore I think they should pay the same rate of duty. The attempt to distinguish between them leads to great complications, and the most expert examiners are frequently puzzled to know which class to put certain goods in. Upon such goods, consisting of cloths, cassi- meres, shawls, table covers, and all other articles that can be measured, not otherwise provided for, composed wholly or in part of wool or worsted, or when mixed with materials of less value, I should levy a duty of *50 cents per square yard and 10 per cent, ad valorem. The present duty is 35 per cent, and 50 cents per pound. Now the pound- weight duty is very objectionable, because the heavy woolens of the winter have to pay a heavier proportionate duty than the woolens of the spring, although the latter may cost precisely the same. For this reason the square-yard duty is more equitable. I come now to blankets. Under the present tariff, not a pair of blank- ets nor a yard of llannel is imported. Why should these fifty millions of people, composed chiefly, of course, of the poorer classes, be deprived of the opportunity of buying these articles in the lowest market merely to support some twenty or thirty manufacturers'? I should propose a tariff* upon blankets composed wholly or in part of wool or worsted, or when mixed with a material of less value — valued at 50 cents per pound or uuder — 25 cents per pound and 10 per cent, ad valorem; valued at over 50 cents per pound, 35 cents per pound and 10 per cent, ad valorem. In this suggested tariff I have made a small ad valorem duty almost throughout. Compound duties are generally very objectionable, but the 10 per cent, is evenly collected by the government, and there can- not be much cheating in it, while if the duty was 60 per cent, there would be a great deal of cheating. On silks, satins, and velvets the present duty is about 60 per cent., but the appraisers calculate that they do not get much over 40 per cent. I noticed that Mr. Kent, one of the examiners, stated the other day that he thought they did collect more thaii that at present, and I think the custom-house is better managed now than ever before; but you know that only one case of goods in ten goes to the custom-house, and the other nine may be greatly under-invoiced. The duty that 1 should propose on *uch goods is, on all piece silks, satins, and velvets, of which 634 TARIFF COMMISSION. [JAMES M. CONSTABLE. silk is the component material of chief value, weighing one ounce or over per square yard, $3.50 per pound and 10 per cent, ad valorem; and on all piece silks, or of which silk is the component of chief value, weighing less than one ounce per square yard, such as marcelines, gauzes, crapes, and such like articles, a duty of 35 per cent, ad valorem. I have said “one ounce” because that is about as low as a dress silk, or silk by the yard, can be worn; and I have put in another 10 per cent, for this reason: a silk costing 5 francs, with an ad valorem duty of 10 per cent., would be half a franc additional. A silk costing 15 or 20 francs will not weigh much more than a silk costing 5 francs, but if it is a 20-franc silk, then, under this proposed duty, instead of half a franc the government gets 2 francs upon it, so that the rich pay a larger proportion of duty than they otherwise would do. I want to keep all these goods in one class, to have all silks, as far as possible, pay one duty; and the same with all woolens, all linens, and all cottons, so as to simplify the tariff. On all manufactures made of silk commercially known as waste I propose a duty of 25 per cent, ad valorem. This waste silk is not really more valuable than cotton, but it goes into a great many articles, being used for filling, as it were. On mixed fabrics the warp or weft being all silk, or nearly so, the other portions of the fabric being of less value, as wool, worsted, or cotton, if commercially known as silks, I would levy a duty $3.50 per pound. There are a great many silks with cotton mixed in that are not in- tended to wear long; so I add that if commercially known as dress- goods they shall pay a duty of 8 cents per square yard and 20 per cent, ad valorem. I prefer to put on an ad valorem duty here rather than to increase the specific duty. There are a great many bombazines, henri- etta cloths, &c., imported, having the weft usually silk and the warp wool or some other material, and these being more costly than all-wool goods I have put a larger rate of duty upon them. I come now to gloves. This is an article which, perhaps, causes more controversy at the custom house than any other. Gloves are made of so many different materials, kid, lamb, goat, some being short and some long, some being lined and some nnlined, that there is great difficulty in collecting the present duty. My firm, who have been large importers of gloves, have been driven out *of the trade; we cannot import kid gloves any longer. A great many systems have been pro- posed, some suggesting a small ad valorem and others a specific duty up to a certain size of glove, a certain specific duty for sizes suitable for men, and another specific duty for sizes suitable for women, because the sizes suitable for men are more costly. That, however, would lead to difficulty. I think the easiest way is to levy an ad valorem duty of 25 per cent, on all kinds of gloves, and 1 think that duty could be col- lected. By Commissioner Oliver : Question. Why would it not be better to have a duty of so much per pair? — Answer. Well, you see some gloves come of different lengths. 1 have considered the matter a good deal, and it seems to me that an ad valorem duty would be the more just of the two. Q. Is there no way that you would recommend of imposing a duty by the dozen t — A. There is no way. I have thought the matter over as well as I could, and I should be very glad indeed to have some way devised of meeting the present difficulty, because we wish to import kid gloves again. JAMES M. CONSTABLE ] DRY GOODS. 635 I pass now to carpets. Under the present tariff Axminster carpets, the most expensive imported, cost from seven shillings to eight shillings a yard, and pay 50 per cent. duty. A Wilton carpet, worth in the English market 20 per cent, less, pays 90 per cent. duty. The reason of that inconsistency is this : When the present tariff was instituted there were no Axminster carpets made in this country, but there were Wiltons, so the manufacturers got this enormous duty imposed upon Wiltons in their own interest. Now that is a case where a specific duty would come in very well. I should propose on Wilton and Axminster carpets a duty of 70 cents per square yard ; on Brussels and velvets 60 cents per square yard; on tapestry Brussels, 30 cents per square yard; ingrains, 20 cents per square yard; druggets, printed or colored, 20 cents per square yard ; oil-cloths and linoleum, 25 cents per square yard ; whole 'carpets made in one piece, rugs and mats of whatever size, 30 per cent. The duty on rugs and mats now under 100 square feet is 45 per cent., and above that 50 per cent. I should recommend a duty on the whole of them of 30 per cent. Then, with free wool and free dye-stuffs we can sell carpets to Canada, a market which is now wholly in English hands. Duties should not be charged on commissions, shipping charges, or packing cases. All petty charges at the custom-house for oaths, per- mits, &c., should be abolished. Consular certificates and the furnishing of samples to the consul should be done away with, as he generally knows nothing about goods, and it puts the importer to a great deal of trouble, expense, and delay. Samples of value should be assessed, and duty paid on them at the appraiser’s store. Entries should be passed the same day they are left at the custom-house, and should be liquidated in thirty days; which liquidation should be final unless for clerical error or fraud. It takes us now four months to have our entries liquidated. We may enter our goods at a certain rate, and, in consequence of the complications of the tariff, it may be found that they should pay some other rate of duty, and although we may have sold our goods at a price based upon the rate at which we entered them, yet we find ourselves mulcted for 10 or 15 per cent, more, so that we sell the goods at a loss. The place of business of my firm is now three miles from the custom- house, and we are obliged to go down there almost every business day in the year, and you gentlemen are perhaps aware how much time is consumed in traveling six miles by stage in the city of New York. We must be at the custom-house two or three hours a day, and the presence of one of the firm is necessary ; a clerk will not do. There- fore I think there ought to be notaries public stationed at convenient points where merchants could go and have their invoices sworn to. Finally, I would provide that all articles known as dry goods should not pay a duty of over 40 per cent. I spoke awhile ago of ladies’ dress goods and the objection to a weight duty. My firm imported some dress goods which cost seven pence, that is, 14 cents, a yard. The agreement with the manufacturer was that they should weigh less than 4 ounces a square yard, but they did weigh a little more; so instead of the duty being 65 or 66 per cent., it was 119 per cent. That is, a duty of 119 per cent, was levied on goods suitable for the wives and children of mechanics and the laboring classes. Again, we imported some woolens ; the government said that tbey were woolens, but we did not believe it, and they took a microscope and inspected the goods to find whether there was any wool in them. Those goods cost 46 cents a yard, and, by using the microscope, the government became satisfied 636 TARIFF COMMISSION. [JAMES M. CONSTABLE. that there was some wool in them, and the duty was 220 per cent, on that common article, suitable for poor men’s wear. By Commissioner Garland: Q. You have emphasized t he disadvantages under which yon labor, resulting from the practice of undervaluation ; what do you suggest as a remedy for that ? — A. Nothing but lower duties. Q. No penalty? — A. Yes; I would recommend seizure. The penalty now is 20 per cent., I believe, where the under-invoicing amounts to 30 per cent.; but under-invoicing cannot be stopped, in my opinion, unless by seizure. By Commissioner Oliver : Q. You think, then, that confiscation is the only thing that will stop it? — A. I do. By Commissioner Garland: Q. Have you any means of estimating the percentage of under-in- voices that are detected? — A. None at all. Q. From a remark which you made awhile ago I infer that very few such cases are detected? — A. 1 presume that a great many of them are not detected. Out of ten cases of goods, you know only one goes to the custom-house for examination. The other nine go unexamined. Q. Yet is it not the fact that if the tenth case is found to be under- valued, the other nine cases are recalled ?— A. Yes, if they are all of the same kind ; but we frequently get fifty or seventy or one hundred cases of goods by one vessel; and our business is such that there may be perhaps only two duplicates in the whole lot, because we are general dealers and general importers of everything we sell. By Commissioner Ambler: Q. But are not the custom-house officers just as likely to happen upon a case in which fraud is attempted as upon any other? — A. Undoubt- edly. Q. And on an average, would not that matter be likely to equalize itself? — A. It is a well-known fact that consigned goods are all under- invoiced to some extent. Q. If that is a well-known fact, why is it not rectified at the custom- house? — A. There comes in the difficulty. An invoice is put up by the appraiser. The importer demands a reappraisement, and a merchant is called in as judge; I am frequently called to act in that capacity my- self. Testimony is produced by the government and also by the im- porter, but the importer’s friends are usually in attendance, and, under- invoicing themselves, they naturally value the goods at somewhat less than their proper value, and the government as a rule is defeated. Q. As 1 understand you, the main trouble as to under-invoicing is on consigned goods ? — A. Yes. I do not believe that a case of goods actu- ally owned was ever under-invoiced. Q. That difficulty, then, might perhaps be overcome by making con- signees ineligible as appraisers ? — A. Where would you go for apprais- ers, then ? Q. Why not take actual importers ? — A. Oh, they can be counted on your fingers. Nearly all the goods imported into this country are im- ported by foreign houses. Q. That is to say foreign houses have found it profi table to establish branches in New York, to whom their goods are consigned, because in that way they can usually get them in on a lower invoice ? — A. Yes. JAMES M. CONSTABLE.] DRY GOODS. 637 The majority of the importers are foreigners, cousins or brothers or nephews of the European manufacturer ; they come here and set up as importers; they do no duty as citizens; they do not become citizens; but they get rich and they take their money away with them. I don’t know a single foreign importer who has remained a citizen of this country. Commissioner McMahon. Citizens alone are eligible as merchant appraisers. The Witness. The only solution of the difficulty is a lower tariff. By Commissioner Oliver. Do all these troubles in regard to under- valuation arise upon goods dutied under the ad valorem rate? — A. Not entirely. When you come to dress goods there is a mixed duty. Q. You say that these difficulties nearly all arise from the ad valorem duty, but nevertheless you recommend ad valorem duties only? — A. No; I recommend in nearly every instance a compound duty, but if I had the making of the tariff* I would make it in two lines — I would make all raw materials free, and I would impose a duty of 25 per cent, on all im- ported manufactured articles. Q. But would you not say that where it is possible, specific duties should be levied, in order to avoid the trouble you have described? — A. Yes, where that is possible I would favor it, but a specified duty would be very unfair towards the poorer classes. The rich people would be the gainers by it. Take silks, for example. Q. Do the poor people wear silks ? — A. Yes, they do wear cheap silks, and where the duty is only specific, as I said before, a 5-franc silk would pay as much duty as a 20-franc silk. Q. You have spoken several times of the interests of the poor in connec- tion with this part of the tariff; now, is it not a fact that the goods which cover the majority and nearly all of the poorer people of this country are made in this country? — A. We, with some half dozen other houses in New York, and others in all the large cities, have been importing these low-priced dress goods for poor people’s wear. Q. I do not speak of dress goods. I am not certain that I understand exactly what you mean by u poor people” in this connection, because it is pretty difficult to associate the idea of poverty with silks; but is it not true that nearly all the really poor people throughout this country wear American goods? — A. There is no doubt about it. Q. A person is not very poor, generally, who can wear Lyons silks, even at 5 francs a yard? — A. But they do. By Commissioner Garland : Q. Have you ever given any thought to the plan of putting a home valuation upon these importations so as to avoid the evils of under- invoicing? — A. That would be almost impossible. The home valua- tion to-day may be one thing and to-morrow it may be entirely different. To give you an exemplification of that, some seven or eight years ago there was a large printed fabric, called the Dolly Yarden, which was quite popularfor a time. We imported some of those goods that cost us $1.35 in gold. We kept them about three months, and we sold them — two cases — at 25 cents, and the man returned one of them, saying that he had bought only one. That, of course, was au extreme case of fluctua- tion ; but it shows how difficult it would be to carry out the plan of home valuation. Q. But that change occurred three months after you had received the goods? — A. Yes; but still it shows how quick those changes are. We paid full duty on those goods, and we did not get half the duty back. 638 TARIFF COMMISSION. [JAMES M. CONSTABLE. Q. What were those goods worth when they arrived ? — A. There was a turn in the market while they were on the way, so that we could not sell them at anything like cost. Q. In that case home valuation would have been an advantage to you ? — A. No ; because, although the merchant would know the fact of the change in the market, the appraisers would not have accepted it. The present tariff calls for the value at the place of export. Now, the chief port of export for French goods is Havre, and the people in Havre know little or nothing about the value of the goods that are shipped there. Q. But I understood you to say awhile ago that the foreign values are certified to by our consuls, who also know nothing about them. — A. Yes ; that is the fact. Q. Would it not be just as well, then, if the values were certified to by somebody on this side ? — A. The government would be just as well off if they were not certified to at all. By Commissioner Ambler : Q. Undoubtedly great inconvenience may result, as in the case which you have given us as an illustration ; but I would like to know whether the plan of home valuation would not be practicable, at least as to staples? — A. The home valuation depends very much upon supply and demand. By Commissioner McMahon: Q. Does not the foreign value also depend upon supply and demand ? — A. The foreign markets are more stable than ours. Goods are made more to order there. We have to order our goods six months ahead, but the home merchant can keep along with the home market. Then, too, there is not the same sudden changing of fashions there that we have here. An article may be merchantable there for three or four or five years, while here it may hold the market for only a month or two. By Commissioner Ambler: Q. We recognize the fact that in regard to French goods, for instance, there is no foreign market value fixed, except that of Havre; but, tak- ing staple goods generally, I suppose there is a well-recognized market value for those? — A. Yes; certain staple cottons, linens, hosiery, and black silks. Black silks are staples, but fancy and colored silks are not. A piece of colored silk may be in great demand to-day, and in a month there may be no demand for it at all. Q. But, as a merchant you are compelled to fix a home value when you put the goods on your shelves? — A. Of course. Q. And is not that the real home value? — A. To us it is. Q. And would not the aggregate of transactions of that kind make the home value? — A. It would, to some extent. Q. As to staples, then, would it be a particle more difficult to ascer- tain the home value on the day of the arrival than to find the value at Havre f — A. Of course, as between the two valuations — one at the port of entry and the other at Havre — it would be very much better to have the valuation at the port of entry, New York, for instance, for goods coming in there; but still, as I have already said, the rapid changes that take place in our markets make that a very difficult matter to deal with. Q. That is quite true ; but would it not be safer for a merchant to pay his duty on imported goods at the home valuation on the day of their arrival?— A. That is a very difficult question to answer. The matter is a difficult one to arrange satisfactorily. JAMES M. CONSTABLE.] DRY GOODS. 639 Q. You buy goods perhaps three mouths before you get them, and you take the risk of the market changes. From the time of shipment to the time of arrival there is a risk of the goods going out of fashion ; but on the day when they reach New York they either have or have not a market, and if they have a market they have a market value? — A. Yes, sir. Q. Then would it not place you in a safer and more business-like po- sition if you could pay the duty upon the home value on that day ? — A. I think it would. %Q. I jet us go a step farther. The importer usually knows the value of the goods that he imports, does he not ? — A. If he owns them he does. Q. Now, would you not be safer in having an invoice of the home value filed in the custom-house on the day of the arrival, and would not that also afford a greater protection to the government than an in- voice made some time before on the valuation at Havre, in view of the fact that such foreign valuation is certified by a consul who usually knows nothing about the matter? — A. Well, I hardly think it would. Q. The day you get these goods you put them on your shelves and mark a price upon them? — A. Yes, sir. Q. And that is, for all your purposes, the market price of those goods? — A. Yes. Q. That being so, what is to hinder you from invoicing your goods when received at the custom house just the same as you invoice them for yourself a few days later when you put them on your shelves?— A. Well, we must have our invoices from the other side, and they must show the actual foreign market value of the goods. If the home val- uation plan were adopted and we thought the goods were not worth what they cost, we should then have the privilege of reducing our invoice. Q. Yes; but if, on the other hand, the goods had increased in value in the mean time., you would be bound to increase your invoices? — A. Yes; a great many importers do raise their invoices now, because they are satisfied they are too low. Q. That is because of the time that has elapsed between giving the order and the shipment? — A. No; but because the importer thinks the goods have been consigned too low. Q. But if he is the actual purchaser of the goods, they are consigned at the price he pays, are they not? — A. Yes; if he is the actual pur- chaser. Q. Now, assuming that the importer has an opportunity to look at his foreign invoices and to get all the information he can on the subject, don’t you think that with a system requiring him to invoice his goods according to his judgment of their value here on the day of their ar- rival, we could ordinarily obtain a more accurate knowledge of the real value of the goods for the purpose of assessing the duty, than under the present system? — A. But here is the difficulty. Our goods come along fifty or sixty cases by a ship; we have not seen the goods, and we don’t know what they are, so that we would be unable to put any value on them. Q. You could at least put the foreign valuation upon them, subject to revision ? — A. That would be the original invoice value. Q. Yes; but if you knew that that class of goods had in the mean time advanced or receded in value in the market, you could correct the invoice accordingly? — A. But we rarely see the same goods twice. We cater for the popular demand; we try to get the newest things, and we very rarely want the same goods two seasons in succession. 640 TARIFF COMMISSION. [JAMES M. CONSTABLE. By Commissioner Oliver : Q. You import large quantities of made-up goods, do you not? — A. Very few of those. Q. I mean different styles of fabrics, changing from year to year? — A. Yes. Q. Abroad the invoice is made out at about the cost and the profit ? — A. Yes; we buy the goods from the manufacturers, and we suppose they make a profit. Q. Those goods are expected to arrive here on the eve of the opening season for that line of goods; now, generally, would not their value ^)e increased ten or twenty per cent, if you had them here at just the right time? — A. Yo; there would be no such difference as that. Q. Well, there would be a great difference? — A. Yo; because every- thing that we import we propose to have at the proper season. Q. But my point is this : you may have an invoice of twenty thousand dollars’ worth of goods for which there is a demand, and if they should arrive at the right moment when there are not many others in the market, would not an honest appraisement, upon the home valuation plan, bring those goods up perhaps 20 or 40 per cent? — A. Yo. Q. You gave us an illustration of a change in the market in the other direction, in the case of the Dolly Vardens that you spoke of? — A. Yes; but even when those goods were in the market there was only a small profit on them, and they had to be sold quickly, because it was supposed that the market would not last long, and it did not. At the time those goods first came, however, they did sell quickly and at rather better than the ordinary profit. Q. Then you think there would be a difference of only ten, fifteen, or twenty per cent, between a valuation made abroad and one made here? — A. There would not be that difference. By Commissioner Ambler : Q. I do not think that home valuation could be adopted in every case, but I certainly do think that it might be in many instances. Take gloves, for example. You say you have been driven out of the market as importers of kid gloves by the frauds that are perpetrated in that business. Yow, as to an article of standard value like kid gloves, would there be any trouble in imposing a home valuation? — A. Yes, sir; it would be very difficult for the examiners, and they are the peo- ple to establish the home valuation. Q. But the examiner would have precisely the same facilities that he has now, if the importer was required to furnish a sworn statement as to the value of the goods on the day of their arrival, and at the same time to furnish the invoice and all the information he could on the subject. With such a rule as that, what difficulty would there be in providing for the home valuation of such goods as kid gloves, for in- stance ? — A. It would then depend wholly upon how competent the examiner was to fix a value upon the article. Q. It depends now upon that, does it not? — A. Kid gloves are ex- tremely deceptive as to their quality, and you could hardly get two men to agree upon the value of a lot of them. Q. But does not precisely the same difficulty arise whether the valu- ation is a foreign or a domestic one? — A. Yes, I suppose it does. Q. Then your suggestion does not seem to furnish a reason for oppos- ing the change in that case. It seems to me that with a staple article like kid gloves, the invoice being furnished, a statement ot the home value being furnished, an opportunity given for examination, and } ou JAMES M. CONSTABLE.] DRY GOODS. 641 gentlemen who do import watching each other closely and watching those whom yon might think disposed to act dishonestly — it seems to me that with all these means of getting at the value, a more just and equitable home valuation might be made than under the present sys- tem 1 ? — A. Well, I think the home valuation would be probably quite as just as the foreign valuation in a majority of cases. Q . And as to the articles upon which it could be properly made ? — A. Yes, of course. The following is the proposed tariff on dry goods submitted by Mr. Constable: COTTON GOODS. On all manufactures of cotton of every description, including cloth- ing in whole or part made up, a duty of twenty per cent, ad valorem. LINEN GOODS. On all manufactures of whatever description, composed of flax, hemp, or jute, or when mixed with cotton, including clothing, in whole or part made up, a duty of 25 per cent, ad valorem. DRESS GOODS. Women’s and children’s dress goods and flannels, composed wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, or silk, costing twenty-five cents or under per square yard, six cents per square yard and ten per cent, ad valorem. Costing over twenty-five cents per square yard, eight cents per square yard and ten per cent, ad valorem. All other goods of whatever description, not otherwise provided for, composed wholly or in part of wool, worsted, the hair of the alpaca, goat, or other animals, such as braids, bindings, fringes, cords, tassels, embroideries, wools and worsteds, laces, insertings, shirts, drawers, hosiery, clothing in whole or part made up, and all articles known as small wares, a duty of twenty-five per cent, ad valorem. WOOL AND WORSTED FABRICS. Cloths, cassimeres, shawls, table covers, and all other articles that can be measured, not otherwise provided for, composed wholly or in part of wool or worsted, or when mixed with materials of less value, a duty of fifty cents per square yard and ten per cent, ad valorem. BLANKETS. Composed wholly or in part of wool or worsted, or when mixed with a material of less value, valued at fifty cents per pound or under, twenty- five cents per pound and ten per cent, ad valorem. Valued over fifty cents per pound, thirty-five cents per pound and ten per cent, ad valorem. SILKS, SATINS, AND VELVETS. On all piece silks, satins, and velvets, of which silk is the component material of chief value, weighing one ounce or over per square yard, shall pay a duty of three dollars and a half per pound and ten per cent, ad valorem. H. Mis. 6 41 642 TARIFF COMMISSION. [JAMES M. CONSTABLE. On all piece silks, or of which silk is the component of chief value, weigh- ing less than one ounce per square yard, such as marcelines, gauzes, crapes, and such like articles, shall pay a duty of thirty-five per cent, ad valorem. Kibbons, ribbon velvets, clothing in whole or part made up, trim- mings, bindings, braids, galoons, gloves, mitts, hosiery, drawers, shirts, laces, and all other articles of silk not otherwise provided for, or of which silk is the component of chief value, a duty of thirty- five per cent, ad valorem. All manufactures made of silk, commercially known as waste, shall pay a duty of twenty-five per cent, ad valorem. Mixed fabrics, the warp or weft being all silk or nearly so, the other portions of the fabric being of less value, as wool, worsted, or cotton, if commercially known as silks, to pay a duty of three dollars and a half per pound. If commercially known as dress goods, to pay a duty of eight cents per square yard and 20 per cent, ad valorem. GLOVES. Gloves made of kid, leather, lined or unlined, of whatever size or description, a duty of 25 per cent, ad valorem. CARPETINGS. Wilton and Axminster carpets, seventy cents per square yard. Brussels and velvets, fifty cents per square yard. Tapestry Brussels, thirty cents per square yard. Ingrains, twenty cents per square yard. Druggets, printed or colored, twenty cents per square yard. Oil cloths and linoleum, twenty-five cents per square yard. Whole carpets made in one piece, rugs aud mats of whatever size, thirty per cent. Duties should not be charged on commissions, shipping charges, pack- ing cases; all petty charges at custom-house for oaths, permits, &c., should be abolished. Consular certificates and the furnishing of samples to him should be done away with, as the consul knows nothing about goods, and it puts the importer to a great deal of expense, trouble, and delay. Samples of value should be assessed and duty paid on same at the appraiser’s store; entries should be passed the same day they are left at the custom-house, and should be liquidated in thirty days, which liquidation should be final, unless for clerical error or fraud. Public notaries qualified to take oaths should be appointed in different parts of the large cities, where merchants might swear to invoices. Articles known as dry goods should not pay a duty of over 40 per cent. ROBERT K. darrah.] APPRAISERS DEPARTMENT, BOSTON. 643 ROBERT K. DARRAH. Boston, Mass., August 24, 1882. Mr. Robert K. Darrah, principal appraiser, Boston custom-house, appeared before the Commission and was interrogated as follows: By the President : Question. How long have you been an appraiser in the custom- house? — Answer. I have been in that office twenty years. Q. What division do you have charge of? — A. Of dry goods. Q. Have you ever considered or formed any opinion in regard to the subject of home valuation?-- A. I never had the matter brought to my attention until I saw a statement in some of the newspapers. My im- pression is that home valuation would not be practicable. I think we can get at the foreign values of merchandize much better. We can take the invoices of the importers and the certificates of the consuls, and arrive at a pretty correct determination of the value of the goods. But I think an attempt to ascertain the home valuation would not be so successful. It would have to be made up from the opinions of an infi- nite number of dealers, and I believe there would be no uniformity what- ever as a result. There would be no two cities where the home valua- tion would be the same, and the values would vary at different ports. Q. Have you ever considered the subject of the creation of a customs tribunal to decide the different subjects that are now forwarded to the department at Washington for decision? — A. Yes, sir. Q. Have you ever made any communication in regard to that sub- ect? — A. Yes, sir; at the request of the Treasury Department I wrote them a communication about a year and a half ago. Q. Will you please state the substance of that communication and give us your present views of the matter? — A. I think it would be a very great advantage to have such a tribunal. The only objection 1 can see to it would be that the appointments of the judges might be made for political reasons, and the best men might not be selected. I think the members of the court should receive appointments for life like judges on the Supreme bench, and if the appointments are made with care such a tribunal would be of the greatest possible value. There should be such a salary also attached to the office as would allow the government to select persons of the highest character and greatest ex- perience. Q. Would you provide for any appeal from that tribunal? — A. No, sir. Q. What has been the class of questions causing the most difficulty in the custom-house here; have they not been questions in regard to the classification of goods ? — A. Yes, sir ; almost entirely, and those questions are continually arising under the present tariff', which is now nearly twenty years old. Sometimes I have been compelled to write a report on these questions nearly every day in the week, whenever new articles are imported for the first time. Q. Do you think that such a tribunal as the one spoken of could take up these questions of classification and settle them satisfactorily to all parties? — A. I think so. A judge who could give his sole attention to these questions would be apt to be very competent, and ought to be able to give a proper decision. These questions come up incidentally 644 TARIFF COMMISSION. [ROBERT K. DARRAH. in other courts, in regard to an infinite variety of subjects. I have a man in mind, who lives in New York, who has been connected with the custom-house service a long time, whose judgment would be almost ab- solute on all these questions, and if such a man could be selected, and appointed for life, having an independent position, his decisions would be very reliable. By Commissioner Ambler : Q. What is your opinion as to the location of such a tribunal; must it necessarily be located at one point, or travel to the different ports? — A. I think it should be located at one point, at New York, for instance, for that is the greatest port of entry in the country. Q. You think appeals could be conveniently heard and determined there without much loss of time? — A. Yes, sir; with less loss of time than anywhere else. New York receives seven times the amount of im- portations that Boston receives. I believe New York comes first, Bos- ton second, and Philadelphia third, then Baltimore, in the order of the amount of importations. By the President: Q. As an appraiser of dry goods you have had occasion to deal with textile goods on which there is a compound duty. Can you tell me whether there is any practical or inherent difficulty in the administra- tion of a compound duty ? — A. It would be much preferable, I think, to have specific duties on everything where the domestic interests of the country would allow it, but I do not think it is possible to get an act of that kind passed. I think it would be of the greatest importance if we could have a specific duty on silk. That is an article on which there has been the greatest frauds. Ninety-nine one hundredths of all the silk consumed in this country is imported into the port of New York for the reason that it is consigned there to agents of the manufacturers. The manufacturer at Lyons sends them to liis agent for very obvious reasons. Messrs. C. M. Hovey & Co , of this city, a large importing firm of experience, have told me that they could not go to Lyons with the gold in their hands and buy these goods as cheaply as they could to get them of the importer’s agent in this country. As soon as they- found out that they were from Boston they would tell them that they must buy from their agents in New York. This is done so as to prevent two kinds of invoices from appearing. The department made a strenuous effort, which was successful to a large degree, to ferret out these decep- tions and frauds. But I know the frauds exist to-day, and have ex- isted for years, and that these goods are undervalued from 30 to 40 per cent. Another advantage which would arise from having a specific duty; it would throw out these dreadfully poisonous substances which they put into silks to make them weigh. Silk in its pure state is one of the longest-lived fabrics in the world; it has been found in the Pyra mids. But these compounds that they put in to make them weigh are very poisonous, and where the silk is rubbed at all it will turn to a lighter color, and the silk also breaks and falls to pieces ; whereas with- out these added substances silks would last for years. If there was a pound-duty it would be largely equal to the present ad valorem duty. They would not pay for that weight, so that our wives and daughters could get pure silks and the goods would also come into the country at their proper values. By Commissioner Ambler : Q. If we were to make the entire duty a pound-duty, would it not operate very severely upon the low grades of silks? — A. Perhaps on robert k. darkah.1 APPRAISER’S DEPARTMENT, BOSTON. 645 certain kinds of silk yon would have to put an ad valorem rate of duty to try to equalize it. If I liad the supreme power I would put a specific duty on silks of so much a pound, and I think it would be of benefit to the consumers. The immense bulk of the importations of silk into the country consists of dress silks ; these thin gossamer silks form a very inconsiderable quantity. Q. You think such a duty would greatly improve the quality of the goods'? — A. Yes, sir; immensely. I do not know of but one quality of black silk (and that is of the highest grade, and very few people can pay the price that is asked for it) that is not weighted ; only one. The prac- tice of weighting silks is almost universal, and the silks really are not worth half so much with these poisonous compounds added to them. By the President : Q. Is it a fact that silks coming into this country are weighted more particularly ? — A. Yes, sir. I am told that the silks imported for Amer- ican use are especially weighted. By Commissioner Ambler : Q. What is the material used to weight them ? — A. I do not know what it is, but it is very poisonous. By the President : Q. Are there any further points on which you desire to speak? — A. I have had no list of subjects on which to speak, but I am ready to answer any interrogatories that may be put to me. By Commissioner Kenner : Q. You appear to be very conversant with the question of appraise- ments and foreign values, and you have expressed a very positive opin- ion against the suggestion to ascertain the domestic or home valuatiou. As I understand, the foreign valuation as ascertained at the Boston custom-house is based upon the invoices sent with the goods and the consular certificates attached. — A. Yes, sir; but that is not final; that is ouly one of the elements. Q. The freights and charges on the goods are also included, and on this basis, as I understand it, the foreign valuation is ascertained ? — A. Yes, sir. Q. You rely upon the consular certificate to some extent ? — A. Yes, sir ; but we do not rely ujion it wholly. Q. You then virtually have nothing but the invoices, the charges, and the inland freight. Could you not obtain that information in this country as to the value of the goods better than you can get it from abroad? — A. Ko, sir; I think not. We never accept the representa- tions of the invoices as being conclusive or final in regard to a matter with which we are unacquainted. When a new article comes in for appraise- ment we suspend examination and do not report upon it until we have availed ourselves of all the means at our command by conversing with people better informed than ourselves to ascertain the value. In regard to articles of current importation we have the means of com- paring one invoice with another, and in that way we can arrive at a pretty correct determination of the value of the goods. If an article is largely imported we know at once the value of the goods because we have had so many invoices to examine. We also have the prices-cur- rent and can see any variation in the prices of goods of these staple articles of importation in Manchester, Bradford, Liverpool, &c. By consulting these prices-current and making a comparison of a large 646 TARIFF COMMISSION. [ROBERT K. DARRAH. number of invokes we ascertain the value very accurately. If we had to depend on the opinions of merchants at home here I do not think we could arrive at a satisfactory conclusion, or feel sure that we had ascer- tained the true value in the sense that we feel that we have ascertained the foreign value. Q. From your long service in the custom-house, and your marked ex- perience in estimating imported goods, do you not think that you could obtain that information from the buyer as well as from the seller of these goods? The seller lives two or three thousand miles away and you do not know the character of the man, and you have admitted that there is a system adopted by manufacturers of sending their goods to agents in this country for disposal. Taking all these things into consideration, do you not think you could ascertain the value of the goods as well on this side of the water as you can, at present, their value abroad? — A. I do not think we could. Whenever an article comes into the custom- house with which we are wholly unacquainted, we inquire of parties who have had experience in that line of goods, and, as we are in constant consultation with buyers and on intimate terms with large importers, necessarily, we have the benefit of their experience, and (without open- ing up the business of one merchant to another) we are able to arrive at a very accurate conclusion in regard to the value. Q. I do not think I made myself understood. Can you not get that same information from home dealers that you now get from the im- porters ? Why could you not get that same information from the resi- dent dealer in this country that you now get from the importer and purchaser of the article? — A. My experience is that the appraisers know more about the value of these articles by reason of their compari- sons of invoices and their other means of information than anybody, ex- cept the largest importers themselves, and as we meet them constantly in our business we have the benefit of their advice also as to the foreign values of these goods. Q. Would not that same thing occur if you were brought into the same relations with the dealers in those articles at home? — A. I do not think so. If the dutiable value was based upon the home valuation we should have to confer with an infinite number of people to ascertain the home value of the goods, and I think it would be a very confusing proceeding; I do not think it would be so safe or practicable a method of arriving at the value as under the present system. By Commissioner Ambler : Q. As I understand, your principal source of information in regard to the values of goods is derived from these different foreign invoices ? — A. Yes, sir. Q. Suppose that each importer was required to value his goods on a home basis. Would not this large number of valuations of the goods afford you the same means of determining what the value was as the present foreign valuation ? — A. I do not think it would. Q. It would become a business necessity on the part of these gentle- men to give you that information ? — A. Still, I do not think there would be any uniformity of values. Prices change considerably, and there is a variation of 8 or 10 per cent, in prices between Chicago and Boston in one line of goods. I suppose we should be compelled to assess the value of the articles at the time of their arrival in this country ; and on that very day there might be a great demand at Cincinnati, Omaha, or other parts of the country for certain classes of goods, and it would cause a large per cent, of difference in price at those different places. 647 ROBERT K. darrah.J APPRAISER’S DEPARTMENT, BOSTON. Q. As I understand you, one great difficulty you experience in ascer- taining the relative value is on account of the fraudulent invoices ac- companying these importations. As to those invoices you have no means of determining just the value except such as you have suggested, which is by consultation with the importers. Why would you not be able to arrive at a valuation of all goods by the same method of consul- tation with the buyers of the goods in this country ?-—. A. We could not rely wholly upon that; we should have to go to a hundred people here and there, and to me it would seem to cause a babel of confusion. We have one great advantage at present in regard to ascertaining the true value of goods, by being able to send to New York and compare the prices with invoices received there from different ports on the same article. Q. And in the case I put, you could compare the same values on dif- ferent articles put on them by the importer, instead of relying upon the value put upon them by the exporter, could you not? — A. I say yes to your question, but I do not think it would have the same value to us. At present we have before us transactions done on a large scale between large sellers in France and England and importers in this country, and by comparing the invoices we arrive at a satisfactory result. But, as you suggest, we should have to go about and get the opinions of a large number of dealers from the retailers up. Q. I understand that these invoices do not always represent actual business transactions ; that a large portion of the goods are consigned. — A. I have been in the appraiser’s office here twenty years, and ac- cording to my experience there are few instances of fraudulent valua- tions in cases where the goods are really purchased. The frauds have been very large in New York in regard to silks, and they are all con- signed. Whenever a new invoice turns up — a consigned invoice — it generally arrests our attention and we scan it very carefully. In my long experience I have never known but few invoices that were fraud- ulent when the goods were actually purchased. Q. But in regard to the other class of invoices, where goods are sent on consignment, you admit that they are largely fraudulent, and that there is considerable undervaluation? — A. Yes, sir; but I understand that those cases are very small, proportionately, to the whole importa- tion of goods at the port of New York. Q. After all, you are compelled to depend on your own opinion ; you cannot take the invoice, and you are compelled to rely upon your own opinion as to the value. Do you think you have better means of get- ting the correct value at the point of exportation than at the point where the goods are received ? — A. I think so ; because we can have communication with the importers of that class of goods, and the result leads to uniformity at all the ports. Q. But under a system of home valuation would you not acquire in your business the same facility in determining the value from the in- formation you obtain here as you have now in ascertaining the foreign valuation ? — A. I have no doubt that we could adopt measures that would enable us to get along under such a system ; but I think the present system is the best. By Commissioner Kenner : Q. Of course you are aware that there are a number of inland ports of entry scattered throughout the United States, established by act of Congress? — A. Yes, sir. Q. A witness before us has testified to a fact of this kind : that he 648 TARIFF COMMISSION. [ROBERT K. DARRAH. and another party had imported goods, I think dry goods, and he shipped his goods to New York, while the other party shipped his to Chicago. He stated that the party who shipped the goods to Chicago was enabled, by the difference in the Chicago appraisement from the New York appraisement, to pay so much less duty that he reshipped the goods to New York, and was able to undersell the party who had received the goods at New York. I can understand that you, with your long familiarity with the subject, can make a correct estimate or ap- praisement of goods coming from Europe ; but the appraiser at Chicago perhaps knows but little of the value of these goods, and would put a different value on them. Do you not think the foreign appraisement or valuation in a case like that comes in very unfavorably i — A. 1 do not know why it would more than any other. If the appraiser at Chi- cago is an incompetent person he might be just as incompetent in en- deavoring to ascertain the home value as he is in ascertaining the for- eign value. Q. The appraiser at Chicago, not having so much experience, is nat- urally apt to be more incompetent, and the importer will ship his goods to Chicago in preference to New York or Boston for that reason. In the seaports where these goods are constantly arriving the appraiser is more competent to determine their value than an appraiser who lives in the interior, is he not ? — A. Yes, sir. B. C. CLARK.] OAKUM. G49 B. C. CLARK. Boston, Mass., August 24, 1882. Mr. B. C. Clark, of Boston, treasurer of the Pearson Cordage Com- pany, and agent of the Boston Oakum Company, made the following statement : I have the honor to present to the Commission, in behalf of the manu- facturers of oakum of the United States, a petition signed by 90 per cent, of interest of the manufacturers, and I will state that all the rest of them would probably have signed the petition had there been time to send it to them for their signature. We have the honor to request that a duty of one cent per pound may be imposed upon foreign oakum, for the following reasons: Pirst. That the wages paid in the United States are from 50 to 70 per cent, higher than are paid to the same class of laborers in England and other foreign countries. Second. That it is therefore impossible for us to compete with the foreign oakum, and our business is rapidly being destroyed and rendered unprofitable. Third. That the cordage manufacturers are protected by a duty on rope, and the same reason exists why our industry, which is of a smaller nature, should be en- couraged. Fourth. The foreign manufacturers can now take American machinery, brand their goods as American oakum, and send them here in foreign vessels at a nominal freight, and undersell us. Fifth. Upon the good quality of oakum depends valuable lives and large amounts of property, and unless the industry is encouraged, the quality will deteri- orate and poor oakum be used. I will now read the petition to which I have referred in my statement. It is as follows : u To the honorable Tariff Commission : “ The undersigned, manufacturers of oakum in the United States, beg most respectfully to request that a duty of one cent per pound may be im- posed upon foreign oakum, and that the raw material, viz, the junk from which it is manufactured, may continue to be admitted free of duty. “We have a large amount of capital invested in the business, and a large number of operatives, to whom we pay from 50 per cent, to 70 per cent, more wages than are paid to the same class of laborers in England and other foreign countries. Under these circumstances it is impossible for us to compete with the foreign goods, and our business is rapidly being- destroyed and rendered unprofitable. We think we can rightfully claim the same protection as is accorded to the cordage manufacturers, who are and have always been protected by a duty on rope. The result has been that the cordage manufactured in this country is universally con- ceded to be the best in the world. If the foreign manufacturers can take our machinery from this country and brand their goods as American oakum and send them here in foreign vessels at a nominal freight, and undersell us in our own market, we submit that our case is clearly enti- tled to consideration. As conclusive proof that this is not imaginary on our part, we quote from a recent printed circular of the Anglo-Amer- 650 TARIFF COMMISSION. [B. C. CLARK. ican Rope & Oakum Company, 12 Hop wood street, Liverpool, England, wliicli lias been sent broadcast over this country. ‘ American manufac- turers cannot continue selling at the reduced prices, whilst we can do so right along. Advantages : first, England is the cheapest market for raw material and labor ; second, our machinery is American, and process of manufacture the same ; third, we lay ourselves out specially for manu- facturing American oakum.’ We use their exact words, and it seems to us that they support our case in the strongest manner. On the score of humanity, we feel that our vessels on the sea and on the lakes should have the oakum which is best, for valuable lives and large amounts of property may and often do depend for safety upon the quality of the article we manufacture. “Sewall, Day & Co. “Boston Oakum Co., by B. C. Clark, Trustee. “H. L. Alden. “Geo. Stratford, by A. J. Stratford “B. Mills Sons. “W. O. Davey & Sons.” CHARLES L. HIGGINS.] CAUSTIC SODA. 651 CHARLES L. HIGGINS. Boston, Mass., August 24, 1882. The following comm imication from Mr. Charles L. Higgins, of New York, in regard to the duty on caustic soda, was read and ordered to be printed. The attention of the Commission is called to the following facts re- lating to the duty on caustic soda : Under the act of July 30, 1846 (see U. S. S tat.' at L., p. 42), “ caustic soda ” was not mentioned by name (eo nomine ); “ soda ash ” was so men- tioned in Schedule G of that act, and was dutiable at 10 per cent, ad valorem. As “ caustic soda ” more nearly resembled soda ash than any other article mentioned in the tariff act, either in material, quality, texture or the use to which it was put or might be put, it was legally dutiable at the same duty as “ soda ash,” viz, 10 per cent, ad valorem. The reason for this I will state under the observations here to be made concerning the act of 1857. The act of 1846 was passed to relieve the country from the debt incurred by the Mexican war, and duties were made very high. Mouey flowed very freely into the Treasury ; in fact there was so much, as will be seen by the debates in Congress from 1856-’57, that many feared that all the money of the country would find its way into the United States Treasury, and the country at large be- come bankrupt. To avert such apprehended evil, the act of 1846 was amended by that of 1857, and duties were largely reduced on fully 90 per cent, of articles mentioned in the act of 1846. Articles in Schedules A and B, by act of 1846, 100 and 40 per cent, ad valorem respectively, were reduced to 30 per cent, ad valorem ; those in Schedule C, by act 1846, 30 per cent.; by act 1857, to 24 per cent, ad valorem; those in Schedule I (1846), 25 per cent., in 1857, to 19 per cent, ad valorem ; those in Schedule E (1846), 20 per cent., in 1857 to 15 per cent, ad valorem ; those in Schedule F (1846), 15 tier cent., in 1857 to 12 per cent, ad va- lorem; those in Schedule G (1846), 10 per cent., in 1857 to 8 percent, ad valorem ; those in Schedule H (1846), 5 per cent., in 1857 to 4 per cent, ad valorem. Very many articles were made free. Under the act of March 3, 3857, amending the act of 1846 (see 11 U. S. Stat. at L., p. 192), “ caustic soda ” was not mentioned by name (eo nomine ); “ soda ash” was transferred to Schedule H, and was dutiable at 4 per cent, ad valorem. “ Caustic soda ” was held, in the case of Gam- ble vs. Mason (7 American Law Register, p. 178), to assimilate by virtue of the similitude act of 1842, in use, &c., to “ soda ash,” and was there- fore dutiable at 4 per cent, ad valorem. As the phraseology in the act of 1846, was in the act of 1846 as amended by the act of 1857, the rea- soning in Gamble vs. Mason applies to the act of 1846, and the legal duty on “ caustic soda ” under the act of 1846 was therefore the same as “soda ash” as stated above. From 1857 to March, 1861, the duty on “ caustic soda” was 4 per cent, ad valorem. March 2, 1861, a new tariff was passed. “ Caustic soda ” was not mentioned by name. “Soda ash” was free of duty. In my opinion “ caustic soda ” was dutiable at 20 per cent, ad valorem. The Treasury Department, I understand, have held that under this act it was still dutiable at 4 per cent, ad valorem. Be this as it may, this act con- tinued in force until August 5, 1861, only. 652 TARIFF COMMISSION. | CHARLES L. HIGGINS. August 5, 1861 (see U. S. Stat. at L., p. 292), was passed a tariff for the purpose of carrying on the war against the rebellious States of the South. In this act “ caustic soda ” was specifically named ( eo nomine ), and by section 1 thereof was made dutiable at 1 cent per pound. July 14, 1862 (see 12 Stat. at L., p. 543), the duty on u caustic soda ” was by the seventh section thereof increased one-half cent per pound, making it in all 1J cents per pound — the government needing, in conse- quence of the great war expenses, still further income than it derived from the act of 1861 and other sources. This duty of 1J cents per pound on u caustic soda” (war duty) is still continued (see Schedule M, U. S. Eevised Statutes, approved June 22, 1874). The foregoing facts show that the excessive duty on u caustic soda” was devised as a war measure, and as the amount of American “ caus- tic soda” used in the manufacture of soap is very small, it actually pre- vents the American manufacturer of soaps competing with those of for- eign countries, where there is no duty on “ caustic soda.” I take the liberty of sending you one of these circulars that you may be prepared to make such a statement of facts before the commission that they will be convinced of the injustice of the present tariff on u caustic soda ” and the advantages that would be derived by the public generally by having u caustic soda ” at least placed on the free list when used in the manufacture of soap. Yours respectfully, New York, August 23, 1882. Chas. L. Higgins. ELISHA P. WHITEHEAD.] AMERICAN WATCHES. 653 ELISHA P. WHITEHEAD. Boston, Mass., August 24, 1882. Mr. Elisha P. Whitehead, secretary of the Elgin National Watch Company, made the following statement: I desire to say a word in regard to the inequality existing in the duty on crude material and manufactured goods. Take this crude enamel used by watchmakers, and it is listed at 40 per cent. duty. Take sheet copper, and it is listed at 45 per cent. Take glass, which figures in a watch. The glass itself is rated at 40 per cent., and yet coming through on a watch it is listed at 25 per cent., so that the foreign manufacturer has an ad- vantage over the American manufacturer on these articles. The foreign watches coming through at a duty of 25 per cent, leaves a difference of 15 or 20 per cent, that the American manufacturer is paying more than the foreign manufacturer on the same articles, making a tax of over 10 cents on each watch. We have buildings already under construction, where the roof is now being put on, which will give us a capacity of making between 2,000 and 2,500 watches a day. Mr. Robbins informs me that the capacity of his company is about 1,000 watches a day, at present, and with the additional buildings that are being erected it will be much more. So that taking this 10 cent tax on each watch that the Americans are paying it amounts to $300 or $400 a day tax that we have to pay before we get on an equality with the foreign manufacturer. If the tax on watches and watch cases was increased to 40 per cent, it would put us on a footing with the foreign manufacturer and give us a better chance for competition. By Commissioner Kenner: Question. What proportion of the labor performed in your establish- ment is hand labor? — Answer. Scarcely any hand labor is used in the manufacture of a watch. By Commissioner Porter : Q. Are you not now selling American watches abroad?— A. Yes, sir. By Commissioner Boteler: Q. If the duty which you ask for was recommended, are you sure that the prices of watches would be correspondingly reduced ? — A. No, sir ; because the taking off of 10 percent, on jewels alone is a small reduction. Q. But would it not cheapen the making of a w T atch to that extent ; would you not be able to sell the watch that much cheaper to the pur- chaser? — A. No, sir 5 it would have no perceptible effect upon the price. Q. If you got your materials that much cheaper I should think it would enable you to sell watches cheaper than you do now ? — A. The reduction is so small that it would hardly figure any in the retail price of a watch. The principal cost, of course, is in the labor. The Walt- ham Company employs about 2,000 men, and we employ about 1,600 men at present. Q. You can now compete successfully with the European makers of watches, can you not? — A. Yes, sir ; in certain grades of watches we can. Q. In the ordinary grades of watches you can compete. The repre- sentative of the Swiss Government at the Centennial Exhibition, I 654 TARIFF COMMISSION. [ELISHA P. WHITEHEAD. believe, made a report to bis government that there would have to be a very severe competition for the market with the American watch makers. — A. Yes, sir; that is true. At that time, however, they had but little machinery employed in Switzerland in the manufacture of watches. It has been their boast, heretofore, that watches could not be made by machinery. But since the Centennial Exposition they seem to have changed their ideas, and now they claim to have the best machinery in the world. I know from observation made during a recent visit to Switzerland that they are making a desperate effort to regain their trade. By the President : Q. Has not the successful manufacture of American watches been largely caused by the introduction of interchangeable parts in watches ? — A. Yes, sir. Q. That was a peculiarity of the American system of manufacture"? — A. Yes, sir. Q. Has that system been introduced abroad ? — A. It has only recently been put in operation to any extent. By Commissioner Ambler : Q. What class of watches do you export? — A. They are all of a low grade at present. Q. What is the extent of the exportation ? — A. Mr. Bobbins has a much larger export trade than we have. Our trade is mostly confined to the United States. GKNEGE B. CLARK.] OPTICAL GLASS. 655 GEORGE B. CLARK. Boston, Mass., August 24, 1882. Mr. George B. Clark, of Cainbridgeport, Mass., of the firm of Alvan Clark & Sons, optical-glass manufacturers, addressed the Com- mission as follows: I desire to present to the Commission some reasons why the duty on optical glass should be taken off. Schools, colleges, and scientific in- stitutions import instruments and material of almost every kind, free of duty 5 whereas, when they desire us to import a large piece of glass and manufacture it for them for optical purposes, we have to pay a duty of 10 per cent.; that is, if we import it ourselves. These institutions, however, can import it free of duty. So that we make arrangements with them to import glass in the rough, and they turn it over to us and we work it up for them. The result is that the government is getting but little revenue from that 10 per cent, duty, and such glass really comes in free; but it subjects these institutions and ourselves, as well as the custom-house officers, to considerable annoyance. The chief cost of this optical glass is in the labor put upon the raw material. If we paid duty on all the glass we import for these institutions the government would not derive more than $100 a year in the way of revenue from it, and we are doing more probably of this kind of work than is done by all the rest of the manufacturers of optical glasses in this country. I do not suppose the government would get, all told, from all the glass imported for this purpose into the LTnited States, a revenue of over $400 or $500 a year. By the President : Question. To whom are the glasses you manufacture sold? — Answer. To schools and colleges all over the country, and we also send some of them to Europe. We are making at present a large 30-inch glass for the Russian Government. The value of a glass of that kind would be about $32,000. When we contracted to make that glass we thought we could get the material in under the clause providing for its free im- portation for the use of schools and colleges, but afterwards we found that the law was so worded that it included only schools and colleges in the United States, and the custom-house officers could not admit it free of duty. We finally wrote to the Russian minister, and a few days afterwards there came an order from the Secretary of the Treasury ad- mitting it free. Several times we have had little delays of that kind, but in almost every case we get the glass in free. Still we have difficulty at the custom-house oftentimes, because some of the customs officers take one view of the matter and some another. Q. What would be, the value of the raw material out of which you manufactured this optical glass you spoke of for the use of the Rus- sian Government ? — A. When we got it, it would hardly come under the designation of raw material. It was worth about $ 6,000 in the form we got it. Such glass has to go through a different form of manufact- ure from the ordinary glass, and there is a great deal of work put upon it. This optical glass is prepared especially for the purpose. When we get it we do not know its actual value. It occasionally happens that such glass is defective, and then we return it and they furnish another 656 TARIFF COMMISSION. [GEORGE B. CLARK. piece. Half of the value is paying for the guarantee. The most of the glass that we use is sent to us unwarranted, and a great deal of it is not lit for use except the small pieces we get out of it, and we lay it aside until we have a call for work to which it is suitable. Perhaps these small pieces are selected out of a 25-pound box of glass, costing a dollar a pound, making the cost, in Paris, $25, and then there is 50 per cent, to be added for insurance and freight, making the total cost about $35. If such a piece of glass was sent to us guaranteed it would cost us probably two or three hundred dollars. The sum of the whole matter is, that the government is getting no revenue from this article, or at least only a very few hundred dollars annually, and the law as it exists at present subjects ourselves and the custom-house officers to a great deal of annoyance. KOYAL E. BOBBINS.] AMERICAN WATCHES. 657 EOYAL E. ROBBINS. Boston, Mass., August 24, 1882. Mr. Royal E. Robbins, treasurer of the American Watch Company of Waltham, Mass., addressed the Commission as follows: I have prepared a statement setting forth our views on the subject of the duty on watches, which has been signed by Mr. Elisha P. White- head, secretary of the Elgin National Watch Company, and myself, which I will read. As manufacturers of watches we beg leave to represent: 1. That the duty on watches, watch movements, and gold and silver and other cases, namely, 25 per cent., is too small. Little argument is needed to enforce this statement. Watches are articles of luxury as well as of use, and as such should pay at least the average charge on articles of personal use or ornament, which it is obvious they do not pay. The reason no higher rate has heretofore been imposed is that being small and valuable they are liable to be smuggled, and it has been asserted that on this account as much revenue can be collected at the present rate as at any higher one. This, we believe, is untrue at the present time, however it might have been twenty years ago, when watches were twice their present price and the custom-house officials less vigilant. It will be asserted that the watch companies have thriven in spite of a low tariff. We reply that more companies have failed than have succeeded, and that the others have had no exceptionally prosper- ous history. Dividends for the last ten years will not average 8 per cent, in any of the companies, and these are earned only by the unstinted use of capital and labor-saving machinery. It is notorious that foreign labor in watchmaking is paid at less than half our rates, and that their supplies and materials are proportionately cheap. We submit that the articles above enumerated should be assessed at 40 per cent. 2. We ask that watch jewels, now rated at 10 per cent., be made free. Watch jewels are made of precious stones and imported, generally, in an unfinished state, by all the watch companies, to supply deficiences in their own jewel shops, and as such are raw material, entitled, on prin- ciple, to favor. The chief claim, however, for abolition of these duties is that being so very diminutive and so costly they are extremely liable to be smuggled, and, in fact, are smuggled in a finished state by the irresponsible trade. Investigation would probably reveal the fact that but few jewels are entered at the customs except by the large watch companies. And yet a very considerable trade is done in these goods of foreign make. A thousand dollars’ worth of jewels could easily be carried in a vest pocket or inclosed in a letter. We would like to show samples of these goods. 3. White and colored enamel, we submit, should also be put on the free list. This article, the composition of which is not accurately known in this country, is an opaque, vitreous substance, ueither porcelain nor glass, but partaking of the qualities of both, as it is made of similar minerals and chemicals, and is used solely in the manufacture of watch dials. Specimens are herewith shown. You will see that the article cannot be used in any other way than as a material in other manufacture. The H. Mis. 6 42 658 TARIFF COMMISSION. [ROYAL E. ROBBINS. duty at present exacted is 40 per cent., under a Treasury decision which, in the absence of specific classification in the tariff, orders it to pay that rate under paragraph stated at 954, page 161, “HeyPs United States Import Duties.” This is a case where raw materials are charged 15 per cent, more than the articles into which they are to be converted. The Treasury decision seems to us to be a strained and improper con- struction. We suppose the value of jewels annually imported by the watch com- panies only to be $100,000, and the value of enamel about $15,000. There is no industry established in this country to object to the aboli- tion of these duties. By Commissioner Ambler: Question. What proportion of the watches made by your establish- ment are exported? — Answer. We think we sell about one-third of our product in foreign countries. Our largest customer is Great Britain, and through Great Britain, the English colonies, although we have a great deal of direct trade with Australia, New Zealand, Japan, and South America, and we are beginning to trade with Mexico and the West Indies, the Cape of Good Hope, and the East Indies. We sell in London alone about £10,000 worth a month, either for consumption in Great Britain or for distribution to some of her colonies whose trade she controls. Q. Substantially, yours is the only American watch company that does an export trade? — A. The Elgin Watch Company has an export trade to a certain extent, but I believe our company does the largest business abroad. By Commissioner Porter : Question. Your export does not consist of the very lowest grade of watches? — Answer. Oh, no, sir. Q. The lowest grade of watches are made in Switzerland, I believe? — A. Yes, sir. We do not make any watches which are as cheap as the lowest Swiss grades. The average grade of our sales in England would be about as high, perhaps, as in this country. They do not take the very highest grades, because their insular prejudices are in favor of their own manufactures when it comes to that class of goods. But it is sur- prising how many watches of American manufacture are sold in the large towns in the north of England. Q. How long have you been exporting watches to England? — A. About eight years. By Commissioner Garland: Question. What portion of the material used in the manufacture of your watches is imported? — A. Not two per cent. We import nothing but a certain proportion of our jewels, in an unfinished state. We have a large jewelry shop, employing more than 100 people, finishing jewels, but we cannot make enough, because we have not room for that purpose, and the deficiency we import in a certain stage of manufacture and fin- ish them in this country to put into our watches. Apart from jewels there is no other imported article, except a few main-springs and this article of enamel, which some companies import, which enters into the manufacture of our watches. Q. Do you not get a rebate on some of these articles when you export your watches? — A. No, sir; we do not. They are so thoroughly incor- porated into the watches that it is impossible to indicate them. ROYAL E. ROEDINS.] AMERICAN WATCHES. 059 By the President : Q. Are there any jewels made in this country ? — A. Not a thousand dollars’ worth, except at these large establishments. There is nothing we import in a finished condition for use in our factories 5 not one article. By Commissioner Ambler : Q. Do you make the highest grade of watches? — A. Yes, sir. Q. Do you make chronometers? — A. No, sir; we do not. We do not believe in the chronometer escapement for a pocket watch, so that we have not made them. 660 TARIFF COMMISSION. {CHARLES P. LAUEIAT. CHARLES P. LAUEIAT. Boston, Mass., August 24, 1882. Mr. Charles P. Lauriat, of Boston, manufacturer of gold leaf, made the following statement: The tariff on gold leaf at the present time is such that persons em- ployed in the business, at the present wages paid, are barely able to earn a decent living. A few years ago the tariff on gold leaf was re- duced and most of the workmen were thrown out of business, and the industry was nearly destroyed. At present the wages paid are small, and if the tariff on gold leaf was reduced the business would be entirely broken up. That is all I care to say. I just wanted to make a short statement to that effect. By Commissioner Porter : Question. You think the duty is high enough now ; you would not advocate the making of it any higher? — Answer. As I say, our work- men are able at present to make just a fair living, but if the duty is re- duced they cannot do even that. The gold-leaf trade in this country is a very small one, and the rate of duty would not make a great deal of difference to the government, but it would affect us very badly. Q. About how many men are employed in the business? — A. In Mas- sachusetts about 25 men only, and in !New York a little over 100 men. There are not over 300 in the whole country. By Commissioner Garland : Q. What are the average wages paid ? — A. From $12 to $18 a week. The best workmen make $18 a week, on the average, and the poorest about $12. They work by the piece altogether. HENRY A. GOULD. J CAMPHOR AND ANILINE DYES. GGL HENRY A. GOULD. Boston, Mass., August 24, 1882. Mr. Henry A. Gould, of Boston, refiner of camphor and manu- facturer of aniline dyes, addressed the Commission as follows: As a refiner of crude camphor, representing two refineries, which have been in existence respectively fifty-eight and twenty-two years, I re- spectfully protest against any reduction of the existing small duty of 3 cents per pound on refined camphor, which acts as a protection to the American refiners without in any way being a burden to the consumer. My reasons are these : The capital required to be invested is large, being obliged to purchase the crude article by the cargo in China or Japan, in order to enable us to purchase it at a price that will enable us to refine without loss, a single invoice being an investment of from $40,000 to $50,000, and the profit rarely exceeds 5 per cent., except in those rare contingencies of short supplies, epidemics, &c. We are only en- abled to make even this profit by handling the article with most minute care in subdivision of labor, and economy in labor-saving appliances. We pay for labor in this country double the price that is required in Europe, and other elements which enter into the manufacture are of in- creased cost, and, as before said, the very moderate protective duty of 3 cents per pound simply protects the American refiner against being- overpowered by the imports from Europe until such time as the country grows to such a point as the labor and other charges in this country shall be equal to those in Europe. There are about some 15,000 packages imported each year of about the import value of $300,000, and there are seven or eight refiners in the United States, it being a business requiring long apprenticeship to do the refining properly. It is rarely that an employe after being in this business leaves his avocation, and some in our employ have been with us from 30 to 40 years. This is one of the industries in which the duty is not a heavy charge, which oppresses the consumer and goes into the pocket of the manufac- turer, but is simply a safeguard to protect the industry from extinguish- ment. By Commissioner McMahon : Question. What is the percentage ? — Answer. Three cents per pound is about 10 per cent, of the cost price. I have no personal ownership of these refineries ; but the parties engaged in this business have been in it for a long time, and if the tariff was taken off they would have to abandon the industry which they have been for many years building up. I hope that the Commission will be able to recommend a reduction of the duty upon aniline colors. The duty now, as you well know, is 50 cents a pound, specific duty, and 35 cents a pound ad valorem. I repre- rent a house in Germany, with a capital of $10,000,000 or $12,000,000, and we sell the goods in the original package in this country. I have reason to know that the duty is so high that it leads, in the first place, to corruption and misrepresentation of goods brought into this country. Without desiring to make any definite statement, I may say that I feel that goods are, owing to this high duty, often brought in on a wrong- valuation in many respects. The argument on this question has been 662 TARIFF COMMISSION. [HEXBY A. GOULD. gone over before you very fully by Mr. Campbell, but I may say, in brief, that a duty of 20 or 25 per cent, would answer all the purposes of pro- tection, as I have instanced in regard to the matter of camphor, and would help the manufacturer, without being a burden on the manufact- urer of textile articles. I paid a visit to South America last summer, and while there could see the reason why they imported their goods from England rather than from this country. The 3 or 4 per cent, which is added on to the cost of American goods by reason of this heavy duty on the raw materials used in their manufacture is the cause of it. Our house in South America imports hundreds of packages of goods from Manchester and other sections of England that we should import from this country if the prices were lower. Of course^ every tax of this kind that is added to the original cost ot the goods acts as a prohibition upon trade from this country. We have a house in South America for which we import largely from England. The freights on goods exported from this country to South America are much larger than they are on goods exported from England, and, of course, the percentage of cost for these pigments and colors add very largely to the cost of the print or the man- ufactured article. I think a moderate duty would do away with the tendency to undervalue these colors when they are imported. At the present rate of duty it is certainly a very great temptation to fraud. By the President : Q. How much does the duty on aniline colors affect the price of the ordinary American prints, for instance ? — A. I am not prepared to an- swer that question exactly ; but I know that we have very carefully prepared tables showing the cost of prints imported from Manchester and the cost of prints and other colored goods made in this country, and the difference is considerable ; and, of course, as you can see, every additional tax on the manufacturer adds to the cost of the manufactured article. A duty of 25 per cent, would answer all the purposes of pro- tecting the American manufacture of aniline colors, as I have instanced in the case of camphor, without adding as heavy a tax to the user of aniline colors. As Mr. Campbell has said, there are from one to two million pounds of colors, representing millions of dollars in value, im- ported annually into the country, but yet the business is in its infancy. I imported in 1866 the first aniline colors ever brought into this country. Q. What colors were they ? — A. They were blues and reds. I had very hard work to dispose of my first consignment of 1,000 pounds ; it took me nearly six months to do it But in the next six months I sold from 850,000 to $75,000 worth, and the business has increased very rapidly ever since. I am satisfied we cannot manufacture these dies in this country as well as they can abroad, unless there is a change in the prices of labor and in other particulars. In Germany laborers are paid from 60 cents to $1.12 a day, while the same laborers in this country receive from $1.50 to $2.50 a day. Alcohol is very cheap in Germany, while here it is loaded down with taxes. Nitric acid there is cheap, while here it com- mands a very high price per ton. And so I might go through the whole catalogue and name the elements that enter into the production of these colors. I should be very glad to see them made in this country, and even as an importer would readily submit to a fair rate of protection in order to develop that industry. There are only three or four companies in this country manufacturing these colors, and with every advantage of protection they have kept the price up as high as the tariff would allow them to, and made the manufacturers pay a royal price for their colors, and the textile manufacture has not been benefited by it, and HENRY A. GOULD.] CAMPHOR AND ANILINE DYES. G63 they never have been able to mate one or two of the last colors. My house, in Germany, manufactures some two hundred colors, while such concerns as the one in Albany, the one at Buffalo, and one or two in Philadelphia only manufacture one or two colors. There are a dozen companies in Europe having a capital of from $12,000,000 to $15,000,000, some of them ; even the smallest of them have at least a million dollars capital, and in that way they can manufacture to very great advantage. I am speaking now of aniline colors, without referring to alizarine, for that is a monopoly under a patent. Q. Is the price of alizarine due to the high tariff? — A, Ho, sir; it is a free article; it is due to the control by one house of the patent under which it is made; it is a monopoly. We represent a manufacturing house in Austria which makes it, but we are prohibited selling it in this country, under a decision given by Judge Lowell. The decision is re- garded in Europe as unsound, but nevertheless we have to abide by it. Q. How much lower are the European users able to buy this alizarine than American users are? — A. I could not answer that question, be- cause since we were enjoined from selling the article I have not followed the price of it. I only know that after the decision of Judge Lowell the manufacturers here raised their price over 100 per cent, in a very few months. The President. I wanted to bring out the fact that the high price of alizarine, one of the most important of the aniline colors, is not due to the tariff. The Witness. A specific duty in one sense would be an unjust one because of the fact that the colors are valued at different prices. A low ad valorem duty of 20 or 25 per cent., it seems to me, would answer every purpose and protect the American manufacturer. As it is now the profits all go into the pockets of these few manufacturers. A re- duction of the duty would reduce the price to the consumer, and enable him to procure the better article which is made abroad. I suppose there are some things that we cannot make in this country, which we shall have to let other people in other countries make for us. 664 TARIFF COMMISSION. [JOHN G. BROWN. JOHN G. BROWN. Boston, Mass., August 24, 1882. Mr. John G. Brown,, of Boston, importer of iron and steel, addressed the Commission as follows : The present duty on bar iron is, in my opinion, unjust in regard to the matter of classification. While the cost of different classes of iron and the cost of importation is the same, the duty on certain classes is very excessive. For instance, on bar iron, rolled or hammered, comprising flats not less than one inch or more than six inches wide, nor less than three-eighths of an inch or more than two inches thick, on rounds not less than three fourths of an inch nor more than two inches in diame- ter, and on squares not less than three-fourths of an inch nor more than two inches square, the duty is one cent a pound ; while on bar-iron, rolled or hammered, comprising flats less than three-eighths of an inch or more than two inches thick, or less than one inch or more than six inches wide, and on rounds less than three-fourths of an inch or more than two inches in diameter, and on squares less than three-fourths of an inch or more than two inches square, the duty is one cent and a half per pound. I think that is excessive and unjust to the importer. I would recom- mend one uniform rate of duty for all manufactured iron, like bar, band, loop, scroll, oval, half-oval, beveled, &c., &c., to come under the head of bar iron, naming all the different kinds and putting them in at one uniform rate of duty instead of having so many of these classifications. By the President : Question. Are you a manufacturer of iron? — Answer. No, sir; I am an importer. By Commissioner Kenner : Q. What rate of duty would you recommend % — A. A uniform rate of three fourths of a cent a pound by weight. I think one uniform rate would do away with all the conflict that arises on account of the rates of these different sizes. We have to be very particular at the custom- house in regard to the size. By Commissioner Porter : Q. It would also remove many of the difficulties which have been presented to us ? — A. Yes, sir. I think a specific rate is better than an ad valorem rate, and I would recommend one specific rate to be placed on all sizes of iron which come under the head of scroll iron or that description of iron. 8. F. GATES.] SHIP-BUILDING. 665 S. F. GATES. Boston, Mass., August 24, 1882. Mr. S. F. Gates, of Cambridg'eport, Mass., appeared before the Com- mission, and made the following statement : Gentlemen of the Tariff Commission: 1 desire to say a few words in regard to the effect of the tariff upon ship-building. The Con- stitution of the United States, section 0, declares, among other things, that “No tax or duty shall be laid on articles exported from any S.tate.” This, you may say, has nothing to do with the tariff, or your duty as commissioners. But I shall endeavor to show you that the tariff* has a very great influence on the cost of the material used for building ships, particularly iron steamships, if built and owned by citizens of the United States and engaged m foreign trade. The duty on iron, forgings, paint, copper, &c., adds to the price of the material if produced within the United States. Pig iron pays a duty of $7 per ton. In Montreal, Canada, several years ago, and per- haps now, there was but little difference in price between Scotch pig iron and American pig iron; that is to say, American pig iron has been sold in Canada in competition for about the same price. If so, it must have been exported from this country less the duty. If this same pig iron, plates, angle iron, rivets, &c., is put into a ship owned by a citi- zen of the United States, she must be built at an increased cost, and when this American-built ship goes to Liverpool she is valued no higher than if made of the same kind of material produced in England. After she leaves tlie shores of the United States and comes in competition with the foreign-built ship, she shrinks in value, probably 10 or 15 per cent, in comparison with the prices paid elsewhere outside of the United States. With this condition of the tariff it will be impossible for us to build ships or steamships of iron for our foreign trade. What is wanted is an opportunity to purchase our own American ma- terial as cheaply as the English can purchase their material. We pay the maker his price, and our government pays or returns to the ship- builder just the amount of duty that is paid on every article that enters into the building of a ship. With the exception of the increased cost of labor in ship building in this country, the American ship owner can then build a ship at pretty nearly the same cost as his foreign rival. The fact is, we cannot build an iron steamship in competition with foreign builders unless the gov- ernment in some way equalizes the cost of the material used in the building. Free trade for the United States is entirely out of the question; a tariff more or less protective must be maintained. When our present tariff system was adopted nothing but wooden ships were built; there was no expectation that iron would be made use of as it is for steam- ships. A tariff system encouraging exports of manufacturers is deserv- ing the attention of the Commission. Commissioner Ambler. What did you say was the difference in the cost of building a vessel here and abroad? — Answer. It costs about 10 to 15 per cent, more in this country, I think. 666 TARIFF COMMISSION. #[CIIARLES TORREY. CHARLES TORREY. Boston, Mass., August 25, 1882. Mr. Charles Torrey, of Boston, importer of marble, appeared be- fore tbe Commission and made the following statement: I have a short statement to make in regard to the duty upon im- ported marble and the manner in which the existing law is executed. The duty on ordinary Italian marble is 20 per cent, ad valorem and 50 cents per cubic foot. This mixed duty we find a continual source of controversy between the importers and the government. It is de- manded that ordinary Italian marble shall be classed as first, second, and third qualities, and that the value of each quality shall not be be- low the sum fixed by the appraisers, no matter at what price it may be bought, which we consider unjust and unlawful. The classification of quality, as invoiced, is also frequently ques- tioned, although it is admitted by the appraisers that it is not possible to judge of qualities correctly, and that no two persons will classify a cargo alike. We contend that it is not possible to fix the true quality of block marble after it is pointed and prepared for shipment. The only persons who can fix the quality with any degree of accuracy are those who see the blocks before they are pointed, just as they are thrown from the quarry. Under the present method of assessing the ad valorem duty the importer is never safe and cannot tell to what ex- pense he may be subjected by the government, though he try never so hard to comply with the regulations and demands of the officers, the law to the contrary notwithstanding. To avoid this contention and to simplify the whole matter, we recom- mend that the duty on all marble be made wholly specific. The import- ers will then understand their position and no injustice will be done to any party. We believe that all the appraisers who have had any ex- perience in this matter will join us in this recommendation. The duty under the existing tariff as assessed and collected on white ordinary Italian marble in blocks amounts to about 75 cents per cubic foot, it must be admitted that this is an immense duty and much higher than it should be for the general welfare and protection of our native pro- ductions. Should the duty be fixed at 50 cents per cubic foot, it would undoubt- edly benefit the marble business generally, afford ample protection to our native productions, while the aggregate amount of revenue would fully equal the sum now collected. I have had this statement signed by Messrs. Bouker Torrey & Co. ; Torreys & Co. ; A. Wentworth Roberts & Co.; and Chas. E. Hall & Co., importers of marble, doing business in Boston. As I have said, if the duty can be changed to a wholly spe- cific duty, it will obviate all this trouble of which we complain, and settle these difficult questions which are continually arising. N. P. HAMLIN.] SUGAR REFINING. 66 7 N. P. HAMLIN. Boston, Mass., August 25, 1882. Mr. N. P. Hamlin, president of the Boston Sugar Refining Company, addressed the Commission as follows : Gentlemen : The undersigned, importers and refiners of sugar, strongly recommend such revision of the present duty on sugar as will prevent the discrimination now operative in favor of certain grades. The existing tariff has given a stimulus to foreign planters to produce a sugar which shall have a high saccharine strength and low color, and, as the law now provides for collection of duty by color only, such sugars (which are in reality semi refined; are being imported in constantly in- creasing quantities. It is for the interest of the importer aud the consumer alike that this discrimination should not exist, and of the several remedies which have been proposed for overcoming the difficulty, we recommend that known as the 11 Boston plan.” Briefly, this provides for the collection of duty on all raw sugars up to 13 Dutch standard in color, on a basis of polar- iscope test, each degree of advance above a standard, say 75°, being ac- companied by 5 cents per 100 pounds increased duty. Raw sugars above 13 Dutch standard in color, and not above 10 Dutch standard, should pay 3£ cents per pound, and those above 16 Dutch standard, and not above 20 Dutch standard, 4 cents per pound, while refined sugars should pay 4J cents per pound. We further strongly recommend such reduction of the present duty as will materially reduce the price of the manufactured article to the consumer, and also prevent the adulteration, which is sure to increase under a high rate of duty. Boston Sugar Refining Company, By N. P. Hamlin, President. Bay State Sugar Refining Company, By E. F. Atkins, President . By Commissioner Kenner : Question. The plan adopted in Boston to test the value of sugars is based upon the jmlariscopic test ? — Answer. Yes, sir. Q. Therefore you recommend that the government shall use the polar- iscope as the method best known to you of testing the value of sugars in order to fix the rate of duty ? — A.. Yes, sir. Q. That you consider the basis of the Boston plan ? — A. Yes, sir. Q. Do all the Boston refiners agree to your recommendations'? — A. I speak only for the refinery^ I represent and one other. But the Boston refiners do not object to the polariscopic test as I understand it. Some prefer an ad valorem sy T stem, but my preference is for the polariscopic test. Q. Do you know anything in regard to the effects of the Hawaiian treaty'? — A. No, sir; only what I have heard and read. I had a con- versation with Mr. Carter, the prime minister of the Hawaiian Islands, and he confirmed the statement made a short time ago by Mr. Have- 668 TARIFF COMMISSION. (N. P. HAMLIN. meyer, that the amount of goods imported from the United States was very small as compared with those imported from other places ; that the amount of machinery purchased in the United States was small, and that the most of their orders went to England. Q. He stated that the Hawaiian sugar-planters generally used Eng- lish machinery instead of American machinery I — A. Yes, sir ; so he informed me. Q„ And that notwithstanding the advantages we supposed we were giving them by allowing them to import their sugars free of duty into this country 1 — A. Yes, sir. By the President : Q. So that, practically, the Hawaiian treaty is not a reciprocity treaty ? —A. No, sir; it is not. By Commissioner Kenner : Q. The “reciprocity” is all on the one side A. Yes, sir; so he ad- mitted to me. t. w. brown.] BUILDERS 7 HARDWARE. 669 T. W. BROWN. Boston, Mass., August 25, 1882. Mr. T. W. Brown, president of tlie Standard Manufacturing Com- pany of Boston, addressed the Commission as follows: Five years ago, in 1877, when the hardware business was much de- pressed, I went to England almost on purpose to see why it was that we could ship hardware to England. Mr. J. B. Sargent, who is one of the largest manufacturers of hardware in the world, and who employs a large number of men, ships a great many goods to all parts of the world as well as to England. I have been shipping goods for the last five years right into the center of the hardware manufacturing industry of England. There is nothing on our list of manufacturers of hardware except pocket cutlery and table cutlery that the English can ship here in competition with our own manufactures; they will continue to ship those articles here under any rate of duty. Therefore I do not see why everything in the nature of builders 7 hardware should not be put on the free list, because we shall always be able to ship those goods abroad. Even the commonest kinds of goods are shipped there in large quanti- ties; goods in which the principal labor is molding. The laborers in England are all controlled by their “unions,” and cannot do a full day’s work, as they can here. I went there in 1878 with the intention of com- mencing business in Birmingham, but I found so many obstacles in the way that I abandoned the attempt. I found even with the best ma- chinery we could not get men to operate it; they would not under the rules of the union work on piece-work or with machinery. The mold- ing machines which are used all through this country they will not use there. Birmingham, a city of nearly 400,000 inhabitants, does not pro- duce as many goods in the line of builders’ hardware as smaller places in the country do, because the men there will not work more than five days in a week, and therefore do not accomplish what they do here. Horseshoe nails are being daily shipped to England now. The iron of which they are made comes from Sweden. Whether or not these ship- ments are made at a profit, I do not know. I know that common board- nails are shipped there in large quantities. At first they were sent there as an experiment, but our nails made by machinery are so much superior that we continue to sell them there at a profit. All the iron- mongers’ gazettes published in England favor the use of American ma- chinery, and they are adopting it gradually, and copying us. We do not copy any of the English goods, but they copy our axes and shovels and all our farming tools, which are made largely in Michigan, at the Ohio State prison, and in Jackson, and shipped even to Bussia. Many mowing-machines are shipped to France, paying 2 cents a pound duty on the case and its contents. By Commissioner Ambler : Question. Are they still shipping abroad ? — Answer. Yes, sir. Our hay-forks, shovels, and farming tools, generally made in the West, are far superior to anything made elsewhere. I visited all these interests in Birmingham and Sheffield, and spent considerable time in investiga- ting the reason why it was that we could compete with the world in these goods. I found they were trying to copy our axes, but they have not doue it yet, and it is my opinion that they will not be able to do it so long as their labor remains as it does. Many of their workers live in attics. They take in their work each day to be examined. Saturday 670 TARIFF COMMISSION. [T W. BROYfN. they get their pay, and they make a holiday of Sunday and Monday. Very few work on Monday. They are far behind our own laboring classes, and do not aspire to anything beyond managing to live along from one week’s end to another. I do not see any reason for putting a protective duty upon builders’ hardware, and I think if the duty on pig iron was taken off it would make a difference of one-half on our ship- ments. The pig iron they use there is not of as good quality as that we use here. We formerly used one-third Scotch and two-thirds American iron, now we use all American iron for fine work, and of the large amount of iron brought to this country two years ago, when prices were up so high, there are many thousand tons still on hand to-day. It was of so poor a quality that it was not used, and it was sold at a loss. If pig iron is brought in here free it would help the Western people in get- ting cheaper mowing-machines and cheaper wire fences. There is no reason why iron in Pennsylvania should not be as cheap or cheaper than it is in England. The same conditions in Pennsylvania and in Connecticut would make it as cheap. But monopolists govern that mat- ter, and they allow the men to work only a portion of the year. The coal interests combine with the iron interests on these points. England is not, as is generally supposed, a free-trade country. Noth- ing goes in there that does not pay a specific duty. A box of clothes- pins that can be bought in this market at from 35 to 50 cents has to pay town dues amounting to 9 cents, and wharfage dues, amounting to 4J cents. That duty amounts to a great many millions of dollars a year ; it is a town duty, and the tax goes towards keeping the streets in repair. I think something of the kind ought to be adopted in this country. It would greatly help the city of New York in the paving of its streets. We might establish a system of town dues to be assessed on Euglish goods. Everything going across to England from Ireland pays a town duty as well as a wharfage fee. I have with me a book on the subject of town duties, which I brought from England, showing the duties levied in the city of Liverpool, and I suppose it is the same in other towns and cities. The city corporations receive an immense amount of money in this way, and their docks and wharves are kept in first class condition. I think a barrel of apples that only costs a dollar here has to pay a town duty of 80 per cent, before it goes to the store. By Commissioner Ambler: Q. The manufacture of builders’ hardware in England, then, is sub- stantially a manufacture employing hand labor? — A. Yes, sir; there are no large manufacturers, as in this country, except the cutlery man- ufacturers at Sheffield. A. The people work there by the piece? — A. Yes, sir; they bring their goods down in a basket and take their money, and if the goods are not accepted they take them home again. The laboring man there is kept down to a certain grade, and hardly ever rises above it. Q. You say the trades-unions limit the amount of work which the laborers are allowed to perform ? — A. Yes, sir; they are controlled prac- tically by these organizations. The man generally follows the same busi- ness that his father and his grandfather followed, and as a result he has not much desire to change his condition. Q. When you state that there are but few large manufacturers there, of course you refer to manufacturers of the particular line of goods of which you are speaking? — A. Yes, sir. Of course, the iron interest has large rolling-mills, but as a rule they have not the large factories devoted to special industries that we have in this country. OSCAE C. MLLEB.] BORDER DUTIES. 671 OSCAR C. MILLER. Boston, Mass., August 25, 1882. Mr. Oscar C. Miller, of the firm of Prouty & Miller, of Newport, Vt., addressed the Commission as tollows : I represent a firm in Newport, Vt., engaged in the manufacture of lumber from spruce and hemlock timber. We get our production from Vermont and Canada. We also have mills in Canada. Our interests are on both sides of the line. If the duty on lumber is allowed to re- main as it is, our interests on this side of the line will be protected, and if the duty is taken off our business in Canada will be benefited, so that, I think, under the circumstances we can claim to speak without prejudice. It is my conviction, however, that the principle of placing a duty on lumber is wrong, for this reason : Our government (as well as private individuals and corporations) is doing all it can to protect our forests and to encourage the growth of timber. The government, I understand, gives sections of land in the West to persons who will set out a given number of trees under what is called, I believe, the tim- ber-culture act. We are all aware of the immense destruction of timber throughout the country, and therefore it seems to me very jmor policy, practically speaking, to put a heavy duty on lumber imported from a foreign country, which comes in here and helps us preserve what timber we have left. The amount of timber, ties, &c., that Is being brought over, and would be brought over, from Canada is immense. I could tell you of the destruction of Canada forests going on at present at the rate of tens of thousands of acres. Hemlock timber is cut down every year just for the bark alone, and the timber is left to lie on the ground and rot. Of course, as you are aware, hemlock and spruce is a cheap article of lumber; there is no heavy valuation put upon it. When you come to reckon the duties, the cost of manufacture and transportation, it makes a cheap lumber in our New Englaud markets, where our trade is very good. I think we should protect our forests in every possible way, and by admitting lumber free of duty the effect will be largely in that direction. I have a number of other topics I should like to speak upon. For instance, take the article of hay, which, at present, pays an ad valorem duty of 10 per cent. I think all duties should be, as far as possible, made specific. I think the duty on hay should be so much per ton, and at a less rate than at present. If the duty was put at $3 a ton — at that specific rate — it would save us all a great deal of annoyance. To illus- trate. Take hay that is grown in the Sorel district — half way between Montreal and Quebec; the very best quality of hay is raised there and sent into the New England market. It is also a competing point for the Boston trade. You can ship hay from there by water or by two or three different lines of railway; so that you can bring the hay for $2 or $3 a ton freight less than from some other points. Where there is no competition in transportation lines it would cost at least $4 a ton to de- liver such hay in Boston. Its ad valorem duty makes the rate imposed upon hay a very fluctuating one, while if there was simply a specific duty it could be more easily computed. There are many reasons why 1 think a specific duty should be placed on all articles imported across 6 72 TARIFF COMMISSION. [OSCAR C. MILLER. the border. If a specific duty was placed upon horses the result would be that you would get the best horses, and they would keep the poorest at home. I also think it would be very advisable to have all duties based upon home valuations ; I mean the value of goods when landed on our shores. I also desire to speak on the subject of granite. I know there were some large granite quarries on our lake, and when the duty was put upon granite they were abandoned, and they are lying idle there to-day. The placing of the duty just stopped the work, and they are not used at all now. I think the duty is about $2 per ton actual weight, and granite is too abundant to enable them to work the quarry with any profit. Another point I would like to speak of, is the matter of consular fees and government fees of all kinds. There is not a gentleman in this room who can tell me to-day what it will cost to go to Canada and buy a horse that costs a hundred dollars there and bring him in on this side of the line; they might study the question some time too. There is a long string of fees that have to be paid, and you never know when you get through with them. The duty on horses at present is 20 per cent. If 20 per cent, does not give the government a large enough revenue, it ought to make it 25 or 50 per cent., and not have a long string of fees attached, amounting to from $5 to $10. The consuls are the biggest nuisance in the whole business combined; it is a perfect outrage on im- porters. Perhaps I am putting that rather strong, but I do regard it as a great nuisance for a very small affair. There has been a. change in the practice up there in regard to the consular business. Everything is left discretionary with the collectors, and they use their discretion in regard to small articles without regard to the consular certificate. The consular agents up there were not getting as large fees as they thought we ought to pay them probably, and the rates seem to have been changed. I do not understand that the government derives any benefit in the way of a revenue from their fees, but I just raise the inquiry. In regard to the item of slabs — we call them waste, and are glad to get rid of them and get enough for them to pay for loading them on the cars — their valuation is $8 a car-load, and they are taken at a very cheap rate to the Saint Albans limekilns and used for burning lime. You first have to pay $3 fees on a car-load of these slabs, or $2.50 if you make out your own papers. Then you have to pay for the manifest 35 cents — 25 cents for the writing and 10 cents for the blank ; and when you get along a little further and make your entry, you have got to pay another 00 cents for that, and you never know when you have got through paying fees. I want the rates stated in such a way that folks can understand them. They are complicated, and no one who is not in the ring knows about them. It is quite a trade to learn them, and they ought to be abolished. For instance, for these small pieces of paper, which they call blanks, they charge 10 cents apiece. Those, we under- stand, are perquisites which go to the government officers. We have to use three blanks each time, and pay 30 cents for them. That is all wrong, although the government allows people to furnish their own blanks in case they are printed in due form according to the rules and regulations. Still, if you should furnish your own blanks they might pick out some little technicality, so that you would have to buy their blanks and pay for them. Another thing; with us on the border transactions are small in amount. They are seldom large transactions at any time. They run anywhere OSCAR C. MILLER.] BORDER DUTIES. G73 from a dollar up. There are more transactions of less than a hundred dollars than over it. For instance, we ship considerable lumber. Lum- ber from our Canada mills averages about $75 a car-load. That lumber is shipped in small lots, of a car-load at a time, to different points all over New England. We have to go through the same operation to get one car-load of lumber through as we would to bring through $10,000 worth of stuff. There is another point that comes right in here. Our railroads bring this stuff over to suit their own convenience. If we started three cars together, and they would keep them together until we got them across the line to the custom-house, we could enter them all three at one time, and the fees would be the same on all three. But the chances are more than equal that before we get them home they get those cars divided, and if they do we have to pay on each separate entry of each one as they come in on separate trains. We run a great many logs up there by rail. They are all free goods, and the valuation would be from $8 to $15 a car-load. Then, we are subjected to these everlasting string of fees all the way through, which, if the government received the benefit of them, 1 should feel different about. Of course, the government does, to a certain extent, get the benefit ; but I want you gentlemen to recom- mend the government to pass a law that our duty shall be so much, and have an entry fee of just so much, and have it so that people can under- stand it, so that a man has not got to educate himself up for years to know what it is going to cost him. We are situated differently from people on the sea-coast. There we are neighbors among each other, and the transactions are small neighborhood transactions. The farms join, and a man will perhaps own a farm on both sides of the line, and that causes a great deal of trouble. Speaking of this consul business, they have divided up these consuls. They give them a certain amount of territory ; sometimes there are two consuls in the same township. An instance came under my observation a few days ago. A man went up to Montreal and went around in the country and bought a car-load of horses, and got them loaded and ready to come to this side, and went to the consul for a certificate. The consul asked him where he bought them. He said some at Three Fivers and some at other places, and the consul said, “I cannot give you a certifi- cate, only for those you have bought here. You can goto Three Fivers and get a certificate for what you bought there.” The result was that that man had to spend two days trying to get certificates to start his car-load of horses. These consuls don’t know anything about the valua- tion. They are the greatest nuisance of anything we have to contend with. By Commissioner Kenner: Question. Are these American consuls or English consuls, that you are speaking of ? — Answer. American consuls, appointed by our govern- ment to reside at different points in Canada. Q. Are they generally men who understand the subjects spoken of in the certificates which they sign; do they know much about it? — A. I don’t think they do; I never knew one to go and look at the property in my life. They always take your statement for it. Q. They sign the certificate blindly? — A. Yes, sir; I have seen piles of certificates that were signed in blank and left to be filled out at your own convenience. I have seen certificates signed in the custom-house on this side and left there for people to make their own entries, and they fill them right out there. H. Mis. 6 43 674 TARIFF COMMISSION. [OSCAR C. MILLER. Q. Who fills them up? — A. The party making the application, usually, or he gets some one to do it. By Commissioner Boteler: Q. Did you ever make a representation of your grievances to the State Department? — A. No, sir. Q. Do you not think it would be well for you to do so?— A. I under- stand that is a part of the State Department, and these consuls are all proteges of theirs, and perhaps it is for their interest to keep them in office. By Commissioner Kenner : Q. What would be the objection to putting horses on the free list? — A. I know of no objection to it ; I do not think it would hurt the interests of our farmers there. Q. You advocate a change from an ad valorem to a specific duty? — A. Yes, sir; that is my opinion every time. Q. Have you any idea how many horses are imported from Canada into the United States? — A. No, sir; I have no data to tell. By Commissioner Boteler: Q. Do your American neighbors raise many horses? — A. We don’t go into it extensively; it is all done in a small way. But of course, we raise a great many horses there. Farming is a leading interest in Vermont. Q. Do you think the farmers would be glad to have Canadian horses come in free? — A. I think they would, for this reason. Our farmers don’t make a speciality of raising horses; we don’t raise horses for market. Q. They would be glad to have cheaper horses to do their work with? — A. I think they buy as many horses as they raise for their own use, taking them on the average. By Commissioner Kenner : Q, How would it do to say all horses and cattle of all kinds imported for breeding purposes should be admitted free of duty ? — A. I think they are now, if they are imported strictly for breeding purpos'es. Q. What would prevent your getting hold of one of these blank cer- tificates and filling it up and stat ing that the horses you imported were for breeding purposes? — A. Nothing, only the oath you take; some people might have scruples on that point. Q. Do they generally have scruples in regard to custom house oaths in your part of the country? — A. Well, we don’t any more than we are obliged to. By Commissioner Porter: Q. Do you think it would be for the interest of farmers to have hay come in free; do you see any reason why it should come in free? — A. I hardly think it would be advisable to bring it in free. Q. Why not? — A. For the reason that we have got to raise hay and raise duties, and I don’t know why hay should not help pay the duties as well as other things, although hay is not sold in our vicinity except in small quantities for shipment. DAVID TOWNSEND.] SUGAR. 675 DAVID TOWNSEND. Boston, Mass., August 25, 1882. Mr. David Townsend, treasurer of the Continental Sugar Befining Company of Boston, addressed the Commission as follows: The views which I have to present to the Commission are not materially different from those presented by Captain Thomas, of the Standard Sugar Befinery, but they are not perhaps as fully elaborated as his statement was. I can make my statement in a few words. On the question of duties on sugar, we beg respectfully to represent that we desire the lowest rate of duty consistent with the necessities of the revenue and a due regard to home interests. We beg to call your attention to the fact that the present assessment of 25 per cent, in ad- dition ro specific rates on sugar was enacted under an emergency re- quiring temporary increase of revenue, and not as an equitable read- justment of duties. The treaty with the Sandwich Islands admits the rapidly increasing product of those islands (now estimated at 70,000,000 pounds) dutyfree. The great bulk of those sugars goes to the Pacific coast, and from thence to the Western markets, affording a discrimination in favor of refiners and consumers at those points of about 2.55 of a cent per pound. We further beg leave to present the following as our views upon the proper mode of assessing duty: First, we recommend an ad valorem rate of duty; but, if the polariscope is to be employed, we recommend the plan proposed February 13, 1878, signed and approved by the merchants and refiners of this city generally, on that date, viz, fixing a specific rate upon all sugar not above No. 13 Dutch standard in color, testing by polariscope not above 75 degrees, and increasing five one- hundredths of a cent for each polariscopic degree above that; also fix- ing a specific rate upon all sugar above No. 13, and not above No. 10, Dutch standard in color; a still higher rate upon all sugar above No. 10, and not above No. 20, Dutch standard in color; and a still higher rate upon all sugar above No. 20, Dutch standard, and all refined sugars. It has always seemed to me that an ad valorem rate of duty at fixed rates on sugar would be preferable. There seems to be a difference of opinion, however, on that point, and I merely offer the suggestion. By Commissioner Kenner : Question. Are you an importer as well as a refiner of sugar? — Answer. Yes, sir ; we import some on our own account. Q. You assent to the statement which has been made, that the test by polariscope is the best way of determining the values of sugar ? — A. My own preference would be for an ad valorem duty, if it is a duty upon the valuation at the time of purchase which is capable of being proved after- ward. The polariscope is used in commercial transactions very largely, although I think it is open to many objections. Yet, if a test of that kind is used at all, I think it is the best at hand. Q. Is not that test used when you buy sugars on the Island of Cuba ? — A. Yes, sir ; it is, very generally. 676 TARIFF COMMISSION. [DAVID TOWNSEND. Q. Do you use it yourself? — A. I think it is uniformly used in all purchases that are made. Q. Can you give any reason why the government should not use the same test for its own purposes ? — A. The only reason is, the large volume of sugar to be appraised by the government. These damp sugars must be tested at different times. If a sample of a damp sugar is kept in an office for an hour in a heated place the result of the test will vary. That is one of the objections to the use of the polariscope — that they cannot draw their sugars to-day and test them immediately as a man who is buying and selling sugar does. Q. Is not that caused by the manner of sampling? — A. No, sir; not necessarily. Q. If you draw a sample of sugar at ten o’clock to-day, and the gov- ernment draws a sample at the same time, and immediately both samples are tested, both being taken from the same part of the box, bag, or hogshead, the polariscope test will be the same in each case, will it not? — A. It ought to be, very nearly. Q. The result would be more accurate than with any other system that could be used? — A. Yes, sir, I think so; provided always that samples are drawn from the same packages and tested at the same time. Q. Do you know of any method by which you can have samples drawn so as to do full justice to the importer and to the government? If so, please state what system you would like to have your samples drawn under. — A. In regard to the muscovado sugars imported here, one part of the hogsheads contains a different grade of sugar than another, and the merchant in sampling sugars aims to get a proportion of the better grade and lower grade, and mixes the two together and tests them. That is his plan in buying and selling. Q. Would you recommend that the government samples be drawn in such a manner as that to arrive at the full average of the sugar con- tained in the package from which the samples are drawn ?*— A. That would seem to me to be a pretty hard thing to do. Q. With such a system as that, and by using the polariscope, would you not get fully arid definitely the value of the sugar?— A. Yes, sir; provided the sugar was tested immediately on its receipt. Q. Of course, I mean under the same circumstances. What is the proportion of refined sugar which you make to the aggregate amount made throughout the United States? — A. I am not prepared to answer the question at present, although I should be glad to give you the infor- mation if I had it. Q. You have alluded to the importation of sugars free of duty under a treaty ; you refer, of course, to our treaty with the Sandwich Islands ? — A. Yes, sir. Q. Do you consider that the government or the community at large derives any advantage from that treaty? — A. No, sir; on the contrary, I consider it a great disadvantage to the government and to the com- munity at large; it is a great injustice to the government. The Sand- wich Islands are increasing their product of sugar every year, and the sugar they send us comes in free of duty. It is certainly an unfair dis- crimination, when sugar from one point may be brought into the United States free of duty and when brought from another point it has to pay from 2J to 2J cents a pound duty. I had some experience in dealing with the West, but my agent there has written me that I need not send any more sugar; that the dealers on the Pacific coast are selling sugar much lower, and they will get their sugars from them. DAVID TOWNSEND.] SUGAR. 677 Q. You think it is a manifest injustice to the importer and refiner on the Atlantic slope*? — A. Yes, sir; and not only that, but it is a mani- fest injustice to the people of the country. Something would seem to be wrong when you can go to Kansas City, for instance, and buy sugar at a less price than you can buy it in Boston. Q. Do you know whether or not the consumer on the Pacific slope is benefited in proportion to the injury done people living on the At- lantic coast*? — A. 1 am not prepared to say; but my impression is the refiner on the Pacific coast gets a greater advantage out of it than the consumer does. Q. What is the price of sugar in San Francisco to the consumer as compared with the price of sugar here ; or does the consumer on the Pacific coast derive an advantage corresponding to the loss to the gov- ernment and the injury to the people of the Eastern States*? — A. My impression is that the consumer does not derive much benefit, but the refiner of San Francisco can work to a very great advantage. A house may make 2,000 barrels a day, and have a market for 1,000 barrels at home, and send the surplus to Kansas City and sell it for a cent a pound less than they could buy it thefe, and yet make a good profit. It is a system of discrimination which allows a man to import his sugar free and distribute it at a low price, while at other points he has to pay a high duty on the same article. Q. I have seen it stated in the public prints (and I want to verify the truth or falsity of the statement) that sugars are being delivered to the consumers in San Francisco, owing to freight combinations or other causes, at a higher price, or at the same price asked in this city ; do you know anything about that *? — A. I have been informed that such is the case, although I am not fully advised. Q. If that is the case, the general consumer gets no benefit from hav- ing these sugars imported tree*? — A. No, sir; but the refiner has an ad- vantage by being able to ship to the East the surplus over and above the amount required in San Francisco, dispose of it at a lower price than it could be sold for in Boston, and yet derive a profit. It seems to me that is discriminating in favor of the refiners at particular points of the country. Q. Have you any idea of the general sentiment of the sugar dealers and refiners of the Atlantic coast on this subject? — A. So far as I have heard, it has been uniformly considered that it was an unjust measure, and a discrimination against us. Q. The importers and refiners of the Atlantic coast regard it as an injury inflicted upon their business? — A. Yes, sir; I have heard it spoken of repeatedly in that way. Q. That is the general sentiment, is it? — A. I think it is. Q. Do you know of any one who is informed on that subject who can speak from the card as to the ultimate consequences of these peculiar importations? — A. No, sir; I do not know of any one in this section of the country who is specially informed in regard to the facts, and, of course, the refiners in San Francisco would not be likely to state them freely; they keep their own counsel. The rates of freight from this part of the country to San Francisco have been so arranged as to make it impossible for us to export sugar there, although 1 am told the rates this way are very much lower. I have had no occasion to verify this statement, because I have not imported sugar from San Francisco. Q. It is very important to know whether there is a discrimination made in favor of the Pacific coast; that is to say, whether you pay 678 TARIFF COMMISSION. [DAVID TOWNSEND. higher rates of freight to San Francisco than you do from San Fran- cisco? — A. Not very long ago a favorable rate of freight was proposed to the Boston and New York refiners for sending their sugar to San Francisco, but very soon afterward that rate was withdrawn, and we supposed it was through the influence of some one on the Pacific coast. Q. You are aware that there is such a discrimination ?— A. Yes, sir; I am. F. A. WYMAN.] HEMLOCK EXTRACT. 679 F. A. WYMAN. Boston, Mass., August 25, 1882. Mr. F. A. Wyman, of Boston, appeared before the Commission and made the following statement : Hemlock extract is the product obtained by grinding and leaching hemlock bark and reducing the liquor to about the consistency of sirup or molasses by evaporation either in vacuo or openly, as you would boil down maple sap to make maple sugar. Upon this article there is at present a duty of 20 per cent. Cutch or gainbier, a similar material for tanning, is free. The extract is chiefly used for tanning and a small proportion for dye stuffs. The tanning material of this country is fast becoming used up, and it has already become a serious question with the shoe, boot, and leather trade as to where they can get their supplies. W^e run four extract works in the United States and five in New Bruns- wick and Canada. To show you the quantity of bark used, I can remark that last year we peeled over 150,000 cords of hemlock bark, or enough to make a pile 4 feet high and 4 feet wide that would reach from Boston to New York. We tan 750,000 hides per year in the United States, making 1,500,000 sides of hemlock sole leather. We export large quantities of hemlock sole leather, a great deal more than w T ould be made by the extract that we import, but, unfortunately for us, we cannot put ear-marks upon our extract, so as to be able to get a drawback of duties on exportation. We find in England, and, indeed, upon the Continent, that we have to compete with Australian leather, the leather tanned in Australia being of a cheaper grade than that tanned in England, and competing with or against American hemlock-tanned sole leather. The hemlock tree has to be cut down to obtain the bark, and in a great many instances the log is left to rot upon the ground. With the present great destruction of our forests all means should be used to save timber. We find that logs that we allowed to rot ten years ago would to day have a value for lumber. I have tried for seme years to obtain data to enable me to approximate the quantity of hemlock bark in the world, and when Mr. Sargent issued the last Forestry Bulletin I wrote him asking his authority for the statements regarding hemlock timber therein con- tained, and in reply he intimates that, he does not feel satisfied that he has obtained the correct estimates thereupon, but the tanners of Penn- sylvania are becoming alarmed at the great quantity of bark used each year. There is no duty on hemlock bark, and the only reason we reduce it to extract is simply to save in the matter of transportation. We do not refine it in any way, but simply reduce the bulk of a cord of bark. Cheaper extract means cheaper leather, and consequently cheaper boots and shoes. With cheaper material we can compete in the South Amer- ican markets as against the European manufacturers of boots and shoes. By making the extract we are enabled to use bark that would otherwise be inaccessible. We own and control at least 1,500,000 acres of hemlock forests in the United States and Canada and New Brunswick. By Commissioner McMahon: Question. When the hemlock extract was first imported in 1872 it was then decided by the Secretary of the Treasury, it being a new article, that it should pay twenty per centum duty. That was ten years ago. Have you since then made any application to Congress for the remis- sion of the duty? — Answer. Yes, sir; there was a strong movement made last winter in regard to it. Q. But nothing was done until after nine years had passed ? — A. I 680 TARIFF COMMISSION. [F. A. WYMAN. do not know, in regard to that, whether there was any action taken upon the subject before. Q. Did you make any movement in that direction at the time the tariff laws were revised or codified"? — A. I do not think any movement was made. The following are some of the reasons for removing the duty on the extract of hemlock bark : The business of manufacturing the extract of hemlock bark is carried on chiefly in Canada. This extract is used for the tanning of leather. For the past five or six years the tanners of this country have found it difficult to procure the bark necessary to carry on their manufacture, the forests in many parts of the country having been cleared of hem- lock trees. The result was that manufactories for the making of hem- lock extract were established in Canada, where bark is plenty. The tanner is thus saved the labor and expense of making his own extract, and is also saved the expense of importing the bark in bulk — a barrel of extract containing the strength of from a cord and a half to two and a half cords of bark. The price of bark has advanced within the year from $8 to 812.50 a cord. As bark is so important an element in mak- ing leather, it will be seen that on it largely depends cheap leather and cheap boots and shoes. The government has seen fit to put an import duty of 20 per cent, on this extract. This protects only an inconsiderable interest — the owners of hemlock lands, who are holding them for speculative purposes, and a few extract works in this country, and it discriminates against the proprietors of more than 5,000 tanneries, who represent one of the most important industries in the country. The government reaps no benefit from this tax, the revenue from it being less than 010,000. The tax, however, prevents our tanners from receiving the benefit of a cheap tanning material, as most of the Canadian-made extract now goes to Europe, where it is used for the inakiug of a cheap leather, which com- petes with our own product, and where it is admitted free. As an indication ot the importance this question of cheap bark is as- suming, it may be stated that the tanners of this country use 1,250,000 cords of bark a year. An acre of hemlock land will yield about seven cords of bark. It thus takes every year upwards of 178,000 acres of land to supply bark to the tanneries. As only nine States produce hem- lock bark, it can be seen why the supply is becoming so rapidly ex- hausted. It ought to be understood that to get the bark the tree must be cut down, and a tree cannot be replaced in less than from 15 to 20 years. The Canadian Government, in view of the increasing importations of bark into this country, are agitating the question of putting an export duty of at least 20 per cent, on bark. The bark itself has been im- ported largely because it was admitted free of duty, while the extract pays the duty complained of. The question here suggests itself: “ Why protect the owners of hemlock lands against the makers of the extract of bark, which would cheapen leather, when they are not protected, and do not ask protection, against foreign bark, which is coming here simply because our own trees have been used up?” The tax is as illogical as it is a burden to a great industry. A memorial has been presented to Congress, signed by most of the leading tanners of the country. Nearly if not all would have signed it had there been an opportunity to present it to them. They ask that this duty of 20 per cent on the extract of hemlock be removed, be- cause it protects very few, if it does anybody; produces an inconsidera- ble revenue, and is a grievous burden to all who in any way use leather. B. JOY JEFFRIES.] SCIENTIFIC PUBLICATIONS. 081 B. JOY JEFFRIES. Boston, Mass., August 25, 1882. Dr. B. Joy Jeffries, of Boston, addressed the Commission as fol- lows : I desire to call the attention of the Commission to some points in connection with the tariff, concerning which I feel a personal interest. I would suggest the propriety of putting on the free list books printed in foreign countries which are presented to people living in this country. I have myself received several books and distributed them to gentlemen living in Europe free of expense to them, and when they in return have kindly sent me their own productions they have been, and are, under the law, stopped in the post-office and sent to the custom-house, where a duty has been levied upon them, which I have had to pay. These books were presentation copies sent to me by the authors or publishers abroad. Of course the number of such books coming into the country must be very small, and the revenue cannot be a heavy one to the gov- ernment. 1 respectfully suggest that all such books should be put upon the free list, as they are not sent here for sale or for fepublication. I am also personally interested in the subject of color-blindness, and have devoted some time and attention to the investigation of that matter as it affects the employes of railroads and ocean steamers. I have occasion to import different kinds of apparatus for testing color-blindness, and have been presented with some instruments adapted to this purpose, by gen- tlemen living in Europe. These instruments were sent to me solely for my own use and not for sale. If Harvard University desires to import scientific instruments for its own use they are admitted free, but if I desire to import similar instruments for scientific use I have to pay a duty on them. If I should go abroad and bring them home with me they would come in free of duty, but if I buy them, or they are sent to me as a present, I must pay the duty. I beg to suggest that persons engaged in scientific work are frequently unable to pay such a tax, and the duty for that reason is sometimes felt to be very onerous. Usually, these scientific instruments are of a kind that cannot be made in this country. For instance, one was sent me from Sweden, and I used it to determine the proportion of color-blindness at the Naval Academy at Annapolis. That instrument was copied there and a duplicate made. I had to pay from 40 to 50 per cent, duty on its importation. I think all such instruments should be put on the free list. The government does not collect a very large amount from the duties imposed upon them, as they are rarely imported. I present these points for your considera- tion, and shall be happy to answer any inquiries which may be addressed to me on this point. By Commissioner Garland : Question. What, in your opinion, would be the effect of putting these instruments and books upon the freelist; would it increase the number brought to this country ? — Answer. It would ; the number would be likely to increase considerably. I have, within a short time, received a book which was sent to me from Germany, and which came through the cus- tom-house. If that book could come in free of duty it would be sent to several persons in this country, and I should translate it for publication G82 TARIFF COMMISSION. fu. JOY JEFFRIES. for the benefit of the publishers and the readers. This duty operates as a cheek on the importation of books of a scientific character. This book is at present being discussed in Eugland, and its author has writ- ten me in regard to having it published in this country. If it could have been distributed to the heads of colleges and others in this coun- try free, it would have attracted attention, and I should now be en- gaged in making a translation of it for publication. Of course we want to protect our own manufacturers in every way, but instruments of this class are seldom made in this country. By the President : Q. How would you distinguish between instruments intended for scientific uses and engineering instruments intended for ordinary busi- ness purposes, such as theodolites, of which there are a large number used in this country? — A. I would make the law read so as to cover instruments not made in this country. If it is a new apparatus I would admit it free of duty, and make the law read in such a way that the moment it is produced in this country and is offered for sale, its free im- portation would be stopped. That would protect the manufacturers in this country. By Commissioner Kenner : Q. You have referred to the subject of color-blindness. Ho you know what percentage of color-blindness there is in the country ? — A. I have myself examined 36,000 persons with a view of determining that ques- tion, and I have found 4 per cent, of males are color-blind. It is con- genital. I have also examined 1,400 females, and of this number I have only found 12 persons who were affected by color-blindness. WILLIAM J. CUTLER.] IMPORTED DRUGS. 683 WILLIAM J. CUTLER. Boston, Mass., August 25, 1882. Mr. William J. Cutler, of the firm of Cutler Brothers & Co., of Boston, importers and wholesale druggists, made the following state- ment: I have very few words to say to the Commission, but I have thought it my duty to lay before you a list of articles in our line of business on which the present duty seems to be excessively heavy and virtually prohibitory. The articles I refer to are as follows : Cream of tartar per pouDd Citric acid do.. Chloroform do.. Ethereal preparations do . . Ethers not otherwise provided for do.. Morphine per ounce Oil cloves - per pound Oil croton do.. Oil cubebs do.. Oil bay-leaves do.. Santonine do.. Strychnine per ounce Tannic acid per pound Tannin do . . Sugar of lead do.. Iodine resublimed do.. Iodide of potash, or do . . Hydriodate of potash do.. Essential oils, not otherwise provided for per cent Chemical medicinal preparations do Medicinal extracts do $0 10 10 1 00 1 00 1 00 1 00 2 00 1 00 1 00 17 50 3 00 1 00 1 00 2 00 10 75 75 75 50 40 40 Quinine is now free; we should recommend 10 per cent. duty. We are in favor of protection so far as necessary to enable the American manufacturer to fairly compete with the foreign manufacturer, aud no further, and think that all foreign and domestic crude articles used in manufacturing should be made free. There are many other small arti- cles which we have not enumerated. You can readily see that the high rate of duty on oil of bay is a great temptation to smuggling. It may be that the Commission will not think that the duties on all these articles is excessive; but 1 have reason to know that they have been so excessive that it has prevented the drug manufacturers of the United States having any competition from abroad. We are not able to import many of these articles in consequence of the excessive duty, and I desire to emphasize that fact. I also submit a list showing the present rate of duty on certain arti- 684 TARIFF COMMISSION. [WILLIAM J. CUTLEU. cles, and the rate we suggest in case a change in these duties is recom- mended by the Commission. Present tariff designation or commercial name of article. Present rate of duty. Proposed rate of duty. Acitate of lead, white Acid, citric Oream of tartar Chemical preparations, medicinal Chloroform Ethers not otherwise provided for (alcohol to be free) Ethereal preparations not otherwise provided for (al- cohol to be free) Extracts, medicinal, not otherwise provided for Iodine, resublimed Morphine Oils: Essential, not otherwise provided for Bay -leaves Cloves Croton Cubebs Lemon (while burgamot is free) Potash, iodide or hydriodate Quinine (with alcohol free) Santouine Strychnine Tannic acid, and Tannin, the same thing 10 cents per pound. . do ....do 40 per cent $1 per pound do do 40 per cent 75 cents per pound. . $1 per ounce 50 per cent $17 50 per pound $2 per pound $1 ner pound do 50 cents per pound. . 75 cents per pound. . i Eree I $3 per pound $1 per pound do $2 per pound Crude articles , when free. 20 per cent. Do. Do. Do. Do. Do. Do. • Do. Do. Eree ; opium 10 per cent. 30 per cent. Do. Fiee; cloves 30 per cent. 30 jier cent. Eree. 20 per cent. 10 per cent. 20 per cent. Do! Do. Pyrethrum roseum, or cinerarisefolium, called by the French, Per- sian chamomiles, or insect flowers, are charged 10 per cent., as not otherwise provided for, when they should be free, under u medicinal natural flowers” or under u dried natural flowers occasionally used as a medicine, but when powdered mainly as an insecticide, under the name of insect powder. We have imported this year 60,000 pounds. H O. HAVEMEYER J SUGAR REFINING. 685 H. O. HAVEMEYER. Boston, Mass., August 25, 1882. Mr. H. O. Havemeyer, of the firm of Havemeyers & Elder, sugar refiners, New York City, addressed the Commission as follows : Gentlemen. I desire to make a brief statement of the points to be considered in regulating the sugar tariff. And first, as showing the importance of the subject, I will state that in 1881, sugar (including molasses and melado) paid $48,000,000 of the $194,000,000 of total revenue from duties. The refiners of tbe United States represent an invested capital of $35,000,000, and employ about 10,000 work men of various grades. Handling, transportation, wharfage, storage, and dealing in sugar affect large interests. Of the entire 50,000,000 of population it may be affirmed that every one is a consumer of sugar, or would be if by appropriate legislation the price can be brought within his means. Objects to be attained.— A suitable system for imposing duties upon articles which must be obtained from abroad should recognize principles of justice and fairness, and should have for its objects the equitable protection and promotion of American industry, the reduction of price so as to reach the means of all classes, and the consequent encouragement of consumption, increase of revenue from duties, and benefit to all inter- ests concerned. Uniform rate of duty . — The effect of a uniform rate would be to exclude cheaper grades, to reduce the volume and value of importation, thus lessening the amount of revenue, and to promote refining at the place of production, to theinjury of American refineries, which can refine sugar at the lowest price, and thus to curtail the number of consumers, with manifest injustice to those of lesser means who compose the large mass of the population. A uniform rate of duty is a misnomer. It means the taxing of lower class sugars at a rate two or three times as great as higher grades. It is condemned by the argument which is put forward in its favor — that. American importers are dishonest, and that the government can only find knaves for its service; that inconsequence a sugar tariff cannot be arranged according to the merits of the subject. In regard to the rate of duty, in some practical way it should be made to correspond with the value of the article. The ad valorem principle is that which is most just, and which the interssts of all concerned re- quire so far as it is practicable. Can a system of specific duties be gradu- ated so far as to fall as nearly as may be equally and justly upon all classes of sugar, and be administered without difficulty ? All difficulty will be obviated if the government, in framing legisla- tion, will take lessons from the methods employed under similar circum- stances by those engaged in the business, who have been taught by experience. Sugars differ in quality and value. Dealers have been compelled to find a convenient, practical, and reliable test for determining quality. The course invariably pursued, and with sure results, is, for sugars above No. 13, Dutch standard, to apply the color test, and for all other sugars to use the polariscope. 686 TARIFF COMMISSION. [H. O. HAVEMKYER. Sugar is a close article, a small fraction of a cent making or prevent- ing a transaction. A test which meets the needs of the trade should answer all the purposes of the government. As regards the proper system of duty, several plans have been sug- gested. First. The Boston plan. Impose a duty, say, of 1.75 cents per pound on all sugars not above No. 13, Dutch standard in color, and testing by the polariscope not above 75° in saccharine strength, and add five one-hundredths of a cent, or five cents a hundred pounds, for each ad- ditional degree of saccharine strength, as indicated by the polariscope. Sugars increase in value at the rate of about one-eighth of a cent per pound for each degree of saccharine strength. Assume that the duty will be at least 40 per cent.; 40 per cent, upon J cent per pound = y^. Sugars above No. 13, Dutch standard, are considered as refined ; they are sold, and should be assessed, only by color. They should be put in groups, say first group, Nos. 13 to 16 ; second, Nos. 16 to 20 ; third, over No. 20 ; and assessed at specific rates, say 3£ cents a pound for the first, 4 cents for the second, and 4J cents a pound for the third group. Second. The same as the first for sugars over No. 13, Dutch standard, but sugars below that standard divide into groups according to sac- charine strength, as determined by the polariscope; say all sugars un- der 75° to be classed in one group; 75°, to and including 82°, in a second group ; 83°, to and including 87°, in a third group ; 88°, to and including 92°, in a fourth group ; and 93° and upwards in a fifth group ; a specific duty of, say, If cents per pound to be assessed upon the first group, 2.1 cents per pound upon the second group, and to be increased 25 cents a hundred pounds for each successive group. Third. Detain the present classification, but put in class Nos. 10 to 13, Dutch standard, all sugars which by the polariscope test above 93° of saccharine strength. Each of these plans has its advocates. The first is most appropriate. It, in effect, imposes a specific duty, modified in a measure so as to ad- just the amount of duty to value. One word as to the matter of refining in bond. No sugar tariff is ad- equate which does not make suitable provision for refining in bond. Then, without injury to any interests, American capital and labor, to a large amount, are benefited; and not only in refining, but for transpor- tation, handling, storage, wharfage, mercantile transactions, and the like. In addition to a system of drawbacks, a safe and secure arrange- ment should be made for bonding refineries, permitting sugars to be refined without preliminary payment of duty when desired, providing for the return of a drawback on exportations where a dutj T upon im- portation has been paid; and providing, further, that the products of refineries may be withdrawn from the bond for consumption upon pay- ment then of the same duties upon such products as under the law would be required upon their importation. A system of drawbacks is liable to lead to differences with the gov- ernment. This paralyzes transactions. The difficulty will be obviated by giving the option to refine in bond. An exact and practical system, binding both upon the government and upon the refiner, will enable the latter to proceed without being deterred by fear of differences about the administration of the law. By Commissioner Kenner: Question. Your business is that of a refiner, I understand? — Answer. Yes, sir. H. 0. ITAVEMEYER.] SUGAR REFINING. 687 Q. Are you a practical refiner? — A. To some extent. Q. You understand the business of refining thoroughly ? — A. Yes, sir ; I think so. Q. You also import sugars largely? — A. Yes, sir. Q. Do you import for sale? — A. No, sir; not as a general thing, but we have sold sugars of our own importation and would sell them if we found it better to sell than to refine them. Q. In importing sugars, how do you test them? — A. By the polari- scope. Q. Do you use that test exclusively? — A. Almost exclusively. Color bas some weight with us in the purchase of sugar. Q. Is there any reason, so far as you know, why the government should not use the polariscope in making its test of sugar ? — A. No, sir; I know of no reason why it should not. In fact, our experience in re - gard to government tests by the polariscope, during Secretary Sher- man’s administration of the Treasury Department, established to our satisfaction the fact of its ability to determine the saccharine strength of sugar. Q. When the government test by the polaroscope was applied to your sugar, did it vary materially from your own test of the same sugar? — A. No, sir. Q. Did it vary at all? — A. Well, perhaps sometimes, one-half per cent., and then a resampling generally resulted in an approximate test. Q. When you buy sugars in any of the sugar-producing-countries, and they are delivered to you in New York, and found to be not of the qual- ity they were represented to be when purchased, in other words, when you buy sugars in Cuba, suxiposing they will test 94°, and upon receiv- ing them here you find they test only 92° or 93°, in settling your ac- count with your vendor, what . is your rule for a reduction ; what allowance is made ? — A. On centrifugal sugars it is one-tenth of a cent a pound. Q. And on other sugars; muscovado sugars? — A. It is about one- eighth of a cent a pound. Q. That is 12 J cents a hundred ? — A. Yes, sir. Q. If you make a reduction of 12J cents for every hundred pounds for one degree difference in the xiolariscope test, would the government be safe in making a reduction of 5 cents a hundred pounds for each degree of difference ; would it be fair for the government to say to the importer, “We will allow a reduction of 5 £>er cent, on every hundred pounds for each change of one degree in the polariscoxie test?” — A. The custom of the trade has establishhd the rate at one-eighth of a cent a pound. The duty is not based on any such custom. It is based on an assessment of the same rate ad valorem on the difference in the value of the sugar. Sugars here and in foreign countries are worth the difference of one- eighth of a cent a x>ound for every degree of test above or below. Q. You spoke of classifying sugars in groups. Can we not classify sugars by the polariscox>e and not by the group? If we take as a basis 75° by the i>olariscope, and a duty of 1.50, couldn’t you add 5 cents a hundred for every degree of difference instead of classifying by groups? — A. l r es, sir; undoubtedly. Q. You see no objection to that system ? — A. Not at all. Q. You say that in the trade you increase or diminish 12£ cents a hun- dred for each point of the imlariscope ? — A. Yes, sir. Q. If you can do that, will not the government be asking very little when it asks an increase of 5 cents a hundred on each degree of differ- ence as shown by the x^olariscope ? — A. Yes, sir. 688 TARIFF COMMISSION. [H. 0. HAVEMEYEU. By Commissioner McMahon : Q. Would not precisely the same object be gained in a more simple and direct manner by a fixed rate on every pound of crystal! izable sugar up to and including No. 13 ; wouldn't that be your first plan? — A. How are you going to determine that ? Q. You say that sugar should be tested exclusively by the polariscope up to and including No. 13, and above that by the Dutch standard of color. Assuming that to be correct, I say is’nt this a more simple and correct method of collecting the duty than the method proposed by you which proposes a number of rates. Why not have one fixed rate for every pound of crystallizable sugar as determined by the polariscope up to and including No. 13 ? — A. The percentage of saccharine strength in some sugars is not worth as much as it is in others. A sugar testing 100° sometimes has four times the value as sugar that another sugar has only testing 50°. When I speak of sugar, 1 speak of the commercial article of sugar. One kind of sugar contains 70 per cent, and another 99 per cent, of sugar. The 99-per-cent, sugar is what is known in com- merce as the pure sugar, and is worth three times as much as the pure sugar in molasses or lower sugar, on account of the economy in refining it. Q. Then the polariscope is the best means of testing the value ? — A. Yes, sir; in sugars testing over 75°. Q. But notin sugars below that? — A. No, sir. The ad valorem sys- tem pure and simple is the proper system, but the tendency of legisla- tion is always towards specific rates. 1 know of no system approxi- mating the ad valorem system more nearly than the polariscope inregard to sugars over 75°. The Dutch standard does not apply to those sugars, but the polariscope steps in and defines the proper class on the ad valorem principle. By Commissioner Kenner: Q. Is not the polariscope generally used in England in determining the true value of sugars? — A. Yes, sir. Q. Is it not also used in determining their value in France? — A. Yes, sir; and in Germany, Russia, and Austria. Q. And even in Holland, where the Dutch standard was established? — A. Yes, sir. Q. Does not the Government of France use the polariscope as a proper test of the value of sugars in levying its duties and allowing drawbacks ?— A. Yes, sir ; I believe it does. Q. Now I desire to ask you a question, which you need not answer unless you desire to. How large is your own business as compared with the total business of refining sugars in the United States? What pro- portion of the refined sugars of the United States are made in the re- fineries in which you are interested? — A. I do not object to answering the question. I should think we make about one-third of the sugars that are refined in this country. Q. What is your x>rincipal objection to the system of drawback at present existing? — A. That it is within the discretion of the Secretary of the Treasury to fix the amount of the drawback. Q. You think that is an unsafe power to lodge in the hands of any one man ? — A. I do. I think a man’s business ought to be under his own control, and only subject to the laws properly enacted to cover it. Q. How would you avoid that difficulty ; by advocating refining in bond? — A. Yes, sir. Q. What do you suggest in regard to that matter ; have you any system to recommend? — A. I have not examined the laws, but I should H. O. HAVEMEYEU.] SUGAR REFINING. 689 say that the same laws that at present apply to other bonded ware- houses should be made to apply to sugar refineries. I do not see why the Government of the United States should not put its own citizens on the same footing with the citizens of other countries. If sugars are made in Cuba, why should not they be made in Brooklyn and brought in subject to the same duties? That is all we ask. Q. in other words, you ask the government to establish for the re- finer a private bonded warehouse? — A. We would like to refine under the general law relating , to bonded warehouses. As I say, I am not perfectly familiar with that law; but the same system which applies to bonded warehouses where merchandise is imported and then withdrawn would do very well. Q. That is to say, the sugar after being placed in the bonded ware- house passes from your control to the control of the refiner ? — A. Yes, sir; subject to the control ot the government official in charge. Q. You would take the sugar and carry it to your refiner and then go through the regular process of refining? — A. Yes, sir. Q. Of course it would not be under the observation of the govern- ment officer while you were doing that, would it? — A. Yes, sir. Q. Would he know the amount of sugar that was placed in the re- finery, and could he keep trace of it ? — A. Yes, sir. He knows now' when sugars are brought from Cuba, when they are entered, and where they are stored. Q. But when it was withdrawn, after the process of refining, would he be able to follow it ? — A. Yes, sir ; he would have to know it or he w r ould not allow it to pass. He would know all about it, because any system adopted would restrict that refiner to bonded sugars, of course. Q. Then you would have one of your sugar houses devoted exclu- sively to the manufacture of bouded sugar? — A. Undoubtedly; there would be no way of determining the matter otherwise. Q. Could a refiner, then, who has but one sugar house where he is carrying on his usual business of refining under this system, refine su- gars and get the drawback on them ; I mean under this system you propose of bonded warehouses ? — A. Under the system I propose of refining in bond, it would be independent of the present system. I do not see why the government should not allow me to refine in bond in- dependently. I do not see why the government should not pay a draw- back on duty-paid sugar equivalent to the amount of duty paid. The two kinds of sugar could not be worked together in the same refinery at the same time. Q. Then you would have both systems prevailing ; the present sys- tem, leaving it to the discretion of the Secretary of the Treasury to determine the drawback where the party made both classes of sugar for home and for foreign consumption, and then have a bonded ware- house under a proper system for refining sugar in bond ; leaving it to the option of the refiner ? — A. Yes, sir. I do not advocate the allow- ing of the Secretary of the Treasury to fix a drawback upon sugar at all. But in justice to those refiners who, having refined duty-paid su- gars, wish to export them, there should be some provision for a suit- able drawback. I do not believe in giving that discretion to the Secre- tary of the Treasury ; I think it should be fixed by statute. What we desire is to work independently of the Secretary of the Treasury. Q. And in order to do that, a party must have a sugar-house devoted exclusively, for the time being at least, to refining sugars for export? — A. Yes, sir, or for importation under the laws of the United States. In refining in bond, we might only want to export a certain percentage ot H. Mis. 6 14 690 TARIFF COMMISSION. H. O. HAVEMKYER. our products and to import into the United States for consumption the balance. Of course we want a drawback ou that which we export, and we only want such duties as foreign sugars are subject to on the amount we import from our refinery; the amount we withdraw, in other words, for home consumption. Q. And you do not want the duty on that amount you withdraw for exportation to be fixed by the Secretary of the Treasury; you do not want that left to his discretion'? — A. No, sir. All sugars withdrawn for consumption pay a duty. The Secretary of the Treasury in his discre- tion fixes the amount of the drawback paid on sugars exported, which is presumed to be equivalent to the amount of duty paid. Of course the other sugars go right into direct consumption, having paid the duty originally. Q. Then what you want is the present system and the bonded system both to prevail? — A. Yes, sir ; but not in one refinery at the same time. Commissioner McMahon. You want two systems. You want the present system for one class of sugars, and you want an additional sys- tem for refining in bond without the payment of duty unless the product is put on the home market. You also want the present system modified by statute, fixing the amount of drawback instead of leaving it to the discretion of the Secretary. The Witness. I think that would be better. By Commissioner Ambler: Q. Do you regard the polariscopic test as an absolute measure of the value of sugar? — A. Not the absolute test, but as nearly a correct test as any system I know of. Q. The polariscope, I understand, does not test sugar at all when it gets below 75° ? — A. I have never seen sugar under 75° tested by it. Q. But whenever it is crystallizable sugar, the use of the polariscope is the proper method of testing it? — A. Yes, sir; for all sugar over 75°. Q. You say you never have heard of any test made with it less than 75° ? — A. I have heard of concrete, a sort of sugar and molasses, being tested in England. That, however, never comes here. Q. You would have a lower rate on molasses and melada in propor- tion to the amount of sugar found in it? — A. Yes, sir. Q. Is there not in this molasses and melada a residuum that is of con- siderable commercial value? — A. Yes, sir. I have not said anything about what the duty on molasses ought to be. however. Q. I understand that your mode of estimating the value above 75° by the polariscopic test covers all the sugars, so far as you know? — A. Yes, sir; it covers all the sugars, not regarding melada or molasses as sugar. The essence of my principle is the value, and molasses should be assessed proportionately to sugar; the same ad valorem or specified rate should apply so as to conform to that principle. Q. Your idea is, then, that below 75° per cent, it should be so graded as to pay on the foreign commercial value and not on its value as con- taining so much sugar? — A. Yes, sir. The houses in molasses-produc- ing countries have a way of determining that ratio which might be of value in determining the mode of assessing it. Q. Are you able to give us that mode of determining the value f — A. No, sir ; I could not. That matter is within the i>ro vince of those houses which deal in molasses. Q. Who could give us that information ? — A. I suppose Mr. Bartol, of Philadelphia, could give you that information, or the firm of D. H. H. O. HAVEMEYER.] SUGAR REFINING. 691 Howell & Co., of New York, or any of the half a dozen molasses-boiling houses I could name. Q. You understand that some of them will appear before the Commis- sion l — A. I do. By Commissioner Kenner: Q. If a man were to come to you in New York and offer you tank-bot- toms, the sirup of sugar-cane, concentrated melada or concrete for sale, would you not, in case you thought it advantageous to buy it, test what- ever lie offered you by the polariscope? — A. I think I should use that test as an auxiliary means of ascertaining its value. By Commissioner Garland: Q. You say that you would like to see the rate of drawbacks fixed by statute? — A. Yes, sir. Q. I understood you to say subsequently that you did not believe any statute could be made to cover it? — A. I do not see why the govern- ment in its legislative capacity, with the same data before it that the Secretary of the Treasury has, should leave it in such a way that the Secretary of the Treasury can fix one rate to-day and change it to a dif- ferent rate to morrow. If the rate was established by statute we could work at least a year without interruption, but when it is established by the Secretary of the Treasury, we cannot work sometimes more than one or two days before there is a change. If the matter was fixed by statute it would have more stability. I would rather work under an unequal system, if it was only stable, than to work under one that was lair but subject to constant change. By Commissioner Kenner : Q. When you made the statement as to the proportion of sugar that your house refined, what was the aggregate of the amount upon which you based that calculation ? — A. One billion six hundred million pounds, or eight hundred thousand tons of sugar. I desire to say a word or two in regard to the Hawaiian treaty, if the Commission will allow me. The price of sugar in California is regulated by the price of sugar in New York, plus the freight from New York to San Francisco. We have made many attempts to supply the San Fran- cisco market with sugar, but the monopoly there keeps the price to the New York figures, plus the freight. The object of the passage of the Ha- waiian treaty was to establish commercial intercourse between this coun- try and the Hawaiian Islands, but the statistics show that the remission of duties on the importation from the Hawaiian Islands amounts in value to just double the importations to these islands from this country. The duties on the sugars which have been imported alone amount to double the value of the total exportations to that island, so that no benefit accrues to the consumer here at all, and the sugar- planters in the Ha- waiian Islands get all the benefit. We think it is an outrage, and that the treaty should be abrogated. By Commissioner Porter : Q. You think that- no benefit has accrued to either the consumer here or in San Francisco ? — A. No, sir; to neither. All such discriminations accrue to the producing country ; never to the consuming country. 692 TARIFF COMMISSION. [HOWE & FRENCH. HOWE & FRENCH. Boston, Mass., August 25, 1882. The following communication from Messrs. Howe & French, of Bos- ton, Mass., was read and ordered to be printed: We beg to call the attention of the Commission to a difference exist- ing at present between the Internal Revenue and Treasury Departments touching the item of shellac varnish. Shellac varnish is simply gum shellac dissolved in alcohol, and comes in under the tariff at 50 cents per gallon and 25 per cent. duty. Parties in Canada buy alcohol here in bond, transport it to Canada, and mix it with shellac in a bonded warehouse there under a special license given by the Canadian Government. Thus manufactured, and having paid no tariff or tax to the Canadian Government, this varnish is shipped all over this country and sold 30 to 40 cents per gallon lower than it can be manufactured here. Last year the customs officers seized a large quantity, and brought the matter before the Secretary of the Treasury for decision. The officers held that in reckoning the cost of shellac var- nish, alcohol should be taken at what it was selling for in Canada, and not at what it was worth in a bonded warehouse there. They further held that this w5s a preparation or compound of which distilled spirits roas the component part of chief value, and consequently should pay the tariff on distilled spirits. (See article 594 in tariff. ) If we are correctly informed, the Treasury Department ruled that inas- much as this was imported under the name of varnish, and was com- mercially recognized as a varnish, it should come in under the tariff specifically set upon it. Alcohol to-day costs consumers all over the country $2.10 to $2.15 per gallon. Your Commission will readily see how it affects the interest of manufacturers here when foreigners can buy our alcohol, tax off, under the regulations of the Revenue Department, carry it home, manufacture it, and bring it in under our tariff, so that they can sell it 40 cents below the price any varnish-maker in this country can produce it at. Your Commission might reasonably consider whether, under certain circumstances, it may not be profitable to foreigners to manufacture this varnish in quantities, so large that it might be an inducement to precip- itate the gum, and sell the distilled spirits remaining in open competi- tion with that selling here and paying the tax. If the gum were cheap enough, as it has been in days gone by, we think this might confront our officials. We think your Commission can obtain from the files of the Treasury Department the correspondence touching this matter a year or more ago. We have to suggest that you propose that shellac varnish and all other varnish manufactured from distilled spirits shall be subject to a tariff no less than that of distilled spirits. We will add that the consumption of this article reaches some thou- sands of barrels per year. We are, respectfully, Boston, Mass., August 25, 1882. Howe & French. JAMES B THOMAS.] SUGAR REFINING. 693 JAMES B. THOMAS. Boston, Mass., Avgust 25, 1882. Mr. James B. Thomas, president of the Standard Sugar Kefining Company of Boston, addressed the Commission as follows : Gentlemen : As importers and refiners of sugar, we ask for a tariff that will not discriminate against the importation of low grades of sugar. The present tariff favors the importation of high- testing sugars, that are partially refined at the place of production, and prevents the importation of a large amount of sugar produced in the East Indies and elsewhere, which, being of very low grade, cannot be imported into the United States while the present discriminating duty exists. We believe the ad valorem principle the most practical and just way of assessing duties, and it, therefore, is our first choice. Our next choice is what is known as the Boston plan, which was recommended by Boston importers and refiners generally, in 1878, which, in effect, is nearly ad valorem, and is as follows: On all tank bottoms, concretes, sirups of sugar-cane juice, melado, concentrated melado, concentrated molasses, and on all raw sugars not above No. 13 Dutch standard in color, testing by the polariscope not above 75 degrees, 1.50 cents per pound, with an addition of five one- hundredths of a cent for each and every degree or fractional part of a degree above 75°. On all sugars above No. 13 Dutch staudard in color, and not above No. 16 Dutch standard in color, 3 cents per pound. On all sugars above No. 16 Dutch standard in color, and not above No. 20 Dutch staudard in color, 3J cents per pound. On all sugars above No. 20 Dutch standard in color, and on all re- fined sugars, 4J cents per pound. On molasses, testing by the polariscope not above 56°, 5 cents per gallon. On molasses, testing by the polariscope above 56°, 10 cents per gal- lon. The above rates would reduce, on the average, the present exorbitant duties only about twenty-five cents per one hundred pounds. We would favor such a reduction as would be consistent with the needs, of the gov- ernment, the business of the country, and the benefit of the consumer. By Commissioner Kenner : Question. Do you represent the refiners and importers of sugar ? — Answer. We are importers and refiners. Q. You mean that you import on your own account? — A. Yes, sir. Q. You do not receive goods on consignment ? — A. No, sir. We im- port on our own account the most of our sugars, and we buy some here. Q. Do you advocate the polariscopie test on all sugars below No. 13 Dutch standard, as the test of the quality of the sugar ? — A. Yes, sir. Q. I would like some information on the question of drawbacks. Do you think the law on the subject of drawbacks could be so construed as to be adapted to the bonded warehouse system ? One of the wit- nesses has stated that the law on the subject of drawbacks leaves too much discretion in the hands of the Secretary of the Treasury in deter- mining the amounts of drawback which he would like to see placed on 694 TARIFF COMMISSION. [JAMES B. THOMAS. sugars and other imported articles. To avoid putting that power and discretion in the hands of the Secretary of the Treasury it was sug- gested that it might be proper to adopt a system of bonded warehouses where sugar might be placed and refined in bond. — A. I think it would be a difficult matter for refiners to refine in bond ; I do not know how that could be done. We should be compelled to have custom-house officers present during the refining process, and that would be very troublesome and expensive. Commissioner Kenner. I think perhaps it would be well to recall the gentleman who made that statement this morning (Mr. H. O. Have- ineyer), and have him repeat, in your presence, his system of refining in bond, so that you could state after hearing it whether you think it would suit the refiners of Boston. Mr. H. O. Havemeyer repeated his statement as follows : u One word as to the matter of refining in bond. No sugar tariff is adequate which does not make suitable provision for refining in bond. Then, without injury to any interests, American capital and labor, to a large amount, are benefited ; and not only in refining, but for transpor- tation, handling, storage, wharfage, mercantile transactions, and the like. In addition to a system of drawbacks, a safe and secure arrange- ment should be made for bonding refineries, permitting sugars to be refined without preliminary payment of duty when desired, providing for the return of a drawback on exportations where a duty upon im- portation has been paid ; and providing, further, that the products of refineries may be withdrawn from the bond for consumption upon pay- ment t hen of the same duties upon such products as under the law would be required upon their importation. “ A system of drawbacks is liable to lead to differences with the gov- ernment. This paralyzes transactions. The difficulty will be obviated by giving the option to refine in bond. An exact and practical system, binding both upon the government and upon the refiner, will enable the latter to proceed without being deterred by fear of differences about the administration of the law.” Mr. Havemeyer. — Bonded warehouses now exist with great advan- tage to the American people, and I do not see why the same, system could not be be applied to refining sugar in bond for the benefit of those who feel disposed to avail themselves of it. There would be nothing compulsory about it. Q. [To the Witness.] Bo you think that a refiner could refine sugars under the system described by Mr. Havemeyer? — A. I have not had time to think much upon that subject, but I cannot see any great advan- tage in it at present, though I may change my mind when I have given the subject fuller consideration. Mr. Havemeyer has probably consid- ered the matter very carefully, and I should like an opportunity to do the same. Q. Are you in the habit of exporting sugars to any extent so that your attention would be called to such a system? — A. Not a great deal during the last year. We have in some years exported largely, how- ever. Q. You understand that the system of drawbacks, particularly as ap- plicable to sugars, is a very important one, and the Commission are en- deavoring to ascertain what modification of that system should be con- sidered by them. They are well aware of the responsibility thrown upon the Secretary of the Treasury, who acts as arbiter in the case and fixes the rate of drawback. That, of course, places very great power in the hands of the Secretary, and that is the reason I ask this question. We JAMES B. THOMAS.] SUGAR REFINING. G95 want to get at the best system possible for the allowance of drawbacks on sugars. Can you state what is the amount of sugar that you refine in proportion to the aggregate amount refined in the United States ?■ — A. I could not, without going into calculations which would occupy some time. I can tell you how much our company refines. We have a capacity for melting 600,000 pounds of sugar a day. We do not always run to our fullest capacity, but the average toe year around would, per* haps, be a half a million or 550,000 pounds a day. By Commissioner Ambler: Q. Making your annual product how much? Or give us the decrease in meltage. — A. We ought to allow about 3 or 4 per cent, for meltage, depending upon the quality of the sugar. 1 have had some facilities in regard to ascertaining the prices of sugar in California. The prices in San Francisco on all grades, from yellow sugars up to the best white sugars, run from 1J to 2§ cents a pound higher than the consumer has to pay here ; the consumer there has to pay about that percentage more than he does here on the aver- age. It is a monopoly there and they are now extending their business. They sell what they can in California at an exorbitant price — between two and three cents a pound more than we get here — and the surplus they ship east to Kansas City and Saint Louis, and probably they will ship it as far east as Chicago before long. The production of the Sand- wich Islands is increasing very fast, from 10,000,000 pounds a few years ago to 70,000,000 this year, and probably 80,000,000 pounds will be the next crop. I was in San Francisco in the early times when we received but very little sugar there; perhaps we would receive in San Francisco 3,000,000 or 4,000,000 pounds of a low grade of yellow sugar. It is only within a few years that we have begun to import the higher grades. They are making much higher grades of sugar there by reason of the process of refining than in former years. The monopoly is a very great one. They discriminate against wholesale dealers in sugar whenever they please. If the dealers import sugar from the Atlantic States these men refuse to sell them their sugar. They compel them to pay their own prices there, or otherwise they will not sell to them. Of course, getting their raw sugars cheaply, and receiving a large price for them, it makes it very hard for us to meet them half-way across the continent and compete with them in the selling of their surplus, which they can afiord to sell at almost any price. By Commissioner Kenner : Q. I understand you to say positively and unequivocally that the price of sugar sold to the consumer at San Francisco, and on the Pacific coast, is from 1J to 2f cents higher than the price that the consumer on this side gets his sugar for? — A. Yes, sir; that is the case, and it has been for the last two or three years. Q. And there has been an inordinate increase of sugar imported from the Sandwich Islands? — A. Yes, sir. Q. Is this owing to the fact of an increase in the cultivation of cane and the manufacture of sugar, or does it arise from commercial rela- tions with China, Java, and Japan, or is it introduced under this Ha- waiian treaty? — A. They are working in the United States to better ad- vantage than formerly, and also extending the fields of production very fast in the Sandwich Islands. Labor is cheap there, and the principal refiner in San Francisco is a large owner of sugar estates in the Sand- wich Islands. 69 6 TARIFF COMMISSION. [JAMES B. THOMAS. Q. The labor of the Sandwich Islands consists principally of Chinese and coolies from the English colonies ? — A. Yes, sir. Q. What is the rate paid for that kind of labor ? — A. I do not recol- lect now, but I know it is cheap ; it must be, necessarily. Q. You spoke of a monopoly ; what do you mean precisely when you use that word ? — A. There are only two or three refiners in San Fran- cisco or on the Pacific coast, and I believe only one in Oregon, and they can fix their prices and get just what they choose to ask. Q. Then the prices to the consumer have not been lowered on ac- count of the Hawaiian treaty ? — A. No, sir ; not at all. By the President : Q. You have been a resident of California? — A. Yes, sir. Q. Are you aware of any efforts having been made in California to manufacture sugar from the beet root? — A. Yes, sir. Q. What has been the effect of the Hawaiian treaty upon that man- ufacture ? — A. It has been very much depressed in consequence of it, and a great many have abandoned the business. A good deal of money was put into that industry some years ago, but I do not think anyone made much from it; still some are trying to manufacture it now. Q. Had these parties you refer to any prosperity before this treaty was made ? — A. They had hardly got fairly under way at that time. Q. Do you know whether the public sentiment in California is that that industry was checked by the operation of the Hawaiian treaty ? — A. Yes, sir ; that is the general impression ; that the industry was very much checked. In 1880 the importation of sugar into the United States from the Sandwich Islands amounted to 64,301,365 pounds. In 1881 the imports amounted to 88,438,000 pounds, showing a great increase over the previous year. By the President : Q. Is the area of sugar production in the Sandwich Islands capable of being enlarged ? — A. Yes, sir ; they can enlarge it to a great extent. In conclusion 1 will submit a table showing the relative prices of re- fined sugars in San Francisco and New York, as follows : CRUSHED. San Francisco. New York. Difference. 1882. Anpnst, 8 $0 12J m 12! 1-a $0 09 1 09 1 09& m 09§ 09! 09! $0 02J 022 9 10 02$ 12 025 15 12! 12! 12! oaf 00 16 17 03 CUBES. 1882. A n mi at, 8 . 12! 12! 09! 03 10 09* 09! 09! 09! 03 12 12! 12! 12! 12! 03 15 03 16 03 17 09! 03 JAMBS B. THOMAS.] SUGAR REFINING. 697 POWDERED. 1 San Francisco. New York. Difference. 1882. August 8 12| 32J 12| 12! 12! 12! 09! to 09§ 09£ 09£ to 09§ 09! to 09! 09! to 09! 09! to 09! 03! to 03! 03J 10 12 03J to 03! 03| to 03! 03! to 03! 03§ to 03! 15 16 17 GRANULATED. 1882. August 8 32 09! 09 02! 02f! 10 12 12 12 09! 09! 09 T 3 S to 09! 09! 02! 15 32 02f 02!! to 02! 02! 16 12 17 12 FINE POWDERED. 1882. August 8 13J 09! 09| 03! 02! 17 13! Tlie San Francisco prices are taken from the San Francisco Trade Review, and the New York prices are taken from Coombs 7 New York Market Report. We find the prices of sirups in San Francisco to be 80 per cent, higher than here. 698 TARIFF COMMISSION. [JOHN G. WEBSTER. JOHN G. WEBSTEB. Boston, Mass., August 25, 1882. The following communication from Mr. John G. Webster was read and ordered to be printed: To the honorable Commission on Revision of the Tariff: Your attention is respectfully requested to the article of mustard oil, or fixed oil of mustard, which is rated by the present existing tariff at 25 cents per gallon. This rate of duty protects no interest in this coun- try, as the amount manufactured here is very small; in fact, the use for the oil heretofore has been very limited. As to its importation, the statistics for 1879 and 1880 show r none brought into any port of the United States. In 1881 there was entered but four-tenths of a gallon, which paid a duty amounting to 10 cents. The first two quarters of the present year show no imports. Back of 1879 we could not readily get access to statistics. Large quantities of the oil could be used for mill purposes in combi- nation with other oils if it could be landed at a less price, and we would therefore respectfully represenst that a duty of 10 cents per gallon would insure to the government a handsome revenue, which it does uot s at present rate of duty, enjoy. John G. Websier. Boston, Mass., August 25, 1882. ARTHUR WILLIAMS ET AL.] SALTPETER. 699 ARTHUR WILLIAMS. Boston, Mass., August 25, 1882. Mr. Arthur Williams, of Boston, president of tbe Oriental Powder Mills, addressed the Commission as follows : We are engaged in the manufacture of powder and converted salt- peter. I desire to state that three-fourths of the gunpowder made in this country is made from nitrate of soda, which is imported from South America free of duty. If you abolish the duty on saltpeter it does not stimulate the importation at all. As we have shown in the paper which will be read by Mr. Chandler, this industry gives employment to a large number of people in this country. The consumption of nitrate of soda will still continue, for this reason : That it costs about 50 per cent, less than saltpeter even if the tariff is taken off. The price of nitrate of soda is about cents a pound, while the price ot salpeter is 6 cents a pound. Assuming that you make saltpeter free, and the price is one cent a pound less, we will have saltpeter costing 5 cents, as against nitrate of soda costing 2.J cents, and the cheaper article makes a better article of powder for blasting purposes. About three-fourths of the powder used in this country is used for blasting purposes. There is but a very small portion of powder used as ammunition. The finer grades of gunpowder are made from Calcutta saltpeter and from the converted salt- peter. There is a large capital invested at present in the industry, and we should regard it as almost a total annihilation of our interests, to say nothing of its national effects, if the duty should be removed. We are entirely independent of England now for our supply of this article. Our government has in years past appropriated as much as $100,000 a year in the preparation of refined saltpeter, and it has large quantities of the article deposited for future use. But the amount the government has at its disposal is not more than one year’s average importation, and if we should get into war with a foreign power we should have to use *this converted niter. That is the whole story as far as our business is concerned. I do not think there is any necessity for making a change. Our business has been conducted on this basis for many years, and there seems to be no complaint from any source in regard to the present tariff. We do not interfere with any other industry in the country, and our business will certainly be destroyed if saltpeter is admitted free. By Commissioner Ambler : Question. It lias been stated to us that there is a large amount of capital invested in the business. Can you tell us about what the total amount is ? — Answer. I think about half a million dollars is in- vested in this industry to-day, in factories and stock; perhaps more. My own company is a large producer, and we are only doing a fair busi- ness as it is, with our present protection. We do not come here asking that the duty on saltpeter shall be increased; we shall be perfectly sat- isfied if it remains as it is. Q. The crude nitrate of potash is worth as imiiorted here, paying duty, about 6 cents a pound? — A. Yes, sir; and we get about Gf cents a pound for the material after it has been refined from the crude mate- rial. We make pure nitrate of potash, the same as it comes from India. Q. You get for your refined nitrate of potash cents a pound and 700 TARIFF COMMISSION. [ARTHUR WILLIAMS ET AL. it is tlie chemical equivalent of the pure nitrate of potash ? — A. Yes, sir. It is put up in barrels for shipping and is about the equivalent of the crude saltpeter at 6 cents a pound. By the President: Q. Where do you get your potash from ? — A. From the continent of Europe. Q. In what form does it come ? — A. In crystals. It is a mealy sub- stance and is shipped in bags, the same as nitrate of soda, which is a manufactured product. The two articles combined make the present nitrate of potash. Mr. Alfred B. Chandler, attorney at law, Boston, said: I appear here in the interest of certain corporations engaged in the manufacture of converted saltpeter, to enter a protest against a sug- gestion made to the Commissiou yesterday for the removal of the duty on crude saltpeter. The protest, which has been prepared by the manu- facturers whom I represent, reads as follows : To the Commissioners appointed to consider a revision of the tariff : — The undersigned, manufacturers of converted saltpeter, in behalf of themselves and others, respectfully protest against any reduction of the tariff on crude or on refined saltpeter, for the following among other reasons : The capital invested in the manufacture of converted saltpeter in the United States is very large. To make imported saltpeter free would close up every domestic fac- tory of converted saltpeter in the country. The British Government control the entire exportation of crude salt- peter (nitrate of potash) in the world. It is in the power of that gov- ernment to prohibit the exportation of this saltpeter to the United States, a power already twice exercised in the past twenty-seven years, once during the Crimean war and once since. To close the domestic factories of converted saltpeter, and to so put this country in the power of Great Britain, is certainly unadvisable ; therefore no reduction should be made of the tariff on crude or on re- fined saltpeter. ORIENTAL POWDER MILLS, By ARTHUR WILLIAMS, President . Boston, Mass., August 25, 1882. I would like to say a few words in explanation of this protest. As you may know, the natural saltpeter of the world is found almost en- tirely on the plains of India, and it is controlled by the English Gov- ernment. The duty on that saltpeter is one cent a pound. This natural saltpeter goes in the market by the name of Calcutta saltpeter, or, more commonly, crude saltpeter. Within the last quarter of a century in this country there has been developed the manufacture of what is com- mercially known as u converted saltpeter.” This converted saltpeter, as distinguished from the crude saltpeter of India, is composed of nitrate of soda, which is imported from Chili free of duty. That nitrate of soda is then compounded with muriate of potash, and the chemical product of the two is nitrate of potash, or what we call in the market here u con- verted saltpeter.” The business of manufacturing this converted salt- ARTHUR WILLIAMS ET AL.J SALTPETER. 701 peter is very large in this country. It is used in the manufacture of the liner grades of gunpowder. It is also very largely employed in pack- ing meats and provisions, an industry which, as we all know, is very extensive in the United States. This home industry, this manufacture of converted saltpeter, is a well-established business in several of the States of the Union, and I understand that the aggregate capital employed is very large. The proposition which was submitted here yesterday to have the tariff, on the crude saltpeter of India removed, would have this effect on the home manufacturers of converted saltpeter: It would make the crude saltpeter free, and would ultimately close up all the home manufactures of converted saltpeter. Now, if these home industries are of necessity to be closed up in this way, the result, as we look at it, is inevitable, that this country will be dependent on England for its saltpeter ; and England, as is well known, has twice in my lifetime — once, as this pro- test shows, in the Crimean war — forbidden the exportation of saltpeter from India to this country and to other countries. It is perfectly plain, then, without any further elaboration, that if you close the home in- dustry of the manufacture of converted saltpeter by taking off the tariff*, you might put this country i n a very awkward position. The two points, then, which I wish to cover by these few words are these : To remove the tariff on the crude saltpeter of India will, first, close the factories now devoted to the production of converted saltpeter here; and, second, which is a matter of national importance, will subject the United States to the caprice and will of Great Britain for the introduction of the salt- peter supply. These two reasons are amply sufficient, as it seems to us, to induce the Commission to recommend that no change whatever in the present tariff on saltpeter shall be made. 702 TARIFF COMMISSION. [EDWIN F. ATKINS. EDWIN F. ATKINS. Boston, Mass., August 25, 1882. Mr. Edwin F. Atkins, of Boston, representing the sugar-importing interest, addressed the Commission as follows : 1 desire to present to the Commission a document which has been signed by all the sugar importers in Boston. With your permission I will read the paper at length: “ The undersigned, sugar importers of Boston, recommend a reduc- tion in the duties on raw sugars : u 1. Because it will give the consumer his refined sugars at lower prices, increase the consumption, and thereby benefit both the importer and refiner. “ 2. Because we believe a cheaper sugar would check its adulteration with glucose, which at times has been so largely carried on by middle- men or mixers. u 3. Because it would remove the principal reason of Spain in keep- ing her high rates of duty on provisions, and induce a reduction on her part, opening a large market for our exports, and turning Cuba to this country for her supplies now so largely purchased iu Europe. “E. Atkins & CO. “Willett, Hamlin & Co. “Dana Bros. “Benj. Burgen & Sons. “ Whitney, Kirtland & Co. “Alf. Winsor & Son. “Kufus C. Cushman & Co. “Chas. V. Porter & Co.’ I * * * * * 7 I also desire to make a few remarks on this subject, giving my own personal views. What I now say is on my own responsibility. The argument of the Louisiana planters iu favor of a high rate of duty is that they need it as a protection against the slave labor of Cuba. I beg your attention to the following figures : The number of slaves nowin Cuba is about 180,000 ; this includes men and women ; by no means are all of this number employed in the raising of sugar, very many being engaged in the tobacco interests, others as laborers in the cities, and a large proportion are house servants. Under the existing laws of Spain the slaves of Cuba will be freed during the next four years, a proportion each year. Each slave has a right to buy himself at a price fixed by the government, a price which, the present year, amounts to $200, and reduces $50 per year as their time of servitude draws to a close. The law compels their owners to pay to each able-bodied male $3 per month, and to each female $2, besides furnishing food and clothing. The old negroes and the younger ones, although free, must be cared for by the owners, so it can be readily un- derstood that two hands have to be fed for every able-bodied slave. Calculating the cost of food and clothing at $7 per month, a figure which I have found to be only a reasonable one, gives us $L4 per month ; add to this average wages of $2.50 and it makes $10.50 per month as the nominal cost of present slave labor in Cuba, leaving out of the calcnla- EDWIN F. ATKINS.] IMPORTED SUGAR. 703 tion loss of time from sickness and other causes, when all expenses, ex- cept the $2.50 wages, must run on. Free labor in Cuba ranges from $17 to $27 per month ; we may say $22 is a fair average rate. The employer furnishes food at a cost of $10 per month; this gives a rate of $32 per month as the cost of free labor in Cuba. The Louisiana planters are paying from 85 cents per day for hoe hands to $1.50 for more skilled labor, the laborers furnishing their own food and clothing ; if we calculate an average rate of $1.25 per day for the working days of the month we find a total cost of $32.50. Considering that tbe Louisiana planter pays a day 7 s wages only for a day’s work, I contend that the average monthly cost of labor in Louisiana is but lit- tle in excess of cost of same in Cuba, and that the Louisiana planter, while entitled to all due consideration, should not expect the consumers to protect him to the extent of the present duty, amounting to some $45,000,000 to $50,000,000, or 250 per cent, of his whole crop. By Commissioner Kenner : Question. What is tbe nature of your business'? — Answer. We are sugar importers and commission merchants, and bankers in the Island of Cuba. Q. Do you import on your own account 1 ? — A. We receive sugar mostly on consignment. Q. Then you represent the foreign producer of sugar ? — A. Yes, sir, somewhat. Q. Have you imported largely on your own account ? — A. Yes, sir. Q. When you import do you test the sugars by the Dutch standard or by the polariscope ?— A. By the polariscope. That is the only method we use. Q. Do you know of any reason why the polariscope should not be used by the United States Government in testing sugar as well as by individuals in their private transactions? — A. I do not, provided we get a reasonably low rate of duty. Q. Does the use of the polariscope depend upon the rate of duty at all ? — A. It does in this way : the higher the rate of duty the more objec- tion there would be to the assessment, because ot the difference in rating sugar from one degree to another ; it is more of a temptation to fraud, and the harder it is to collect a fair duty. Q. You mean the higher the duty the greater the temptation to fraud ? — A. Yes, sir. Q. Would not the use of the polariscope lead to the proper classifica- tion of sugar, whether that sugar was worth five or ten cents a pound ? — A. Yes, sir ; I think it would show the gradations in sugar as fairly as any means that could be adopted. Q. You see no objection to its being used by the government, then, as well as by the individual dealers in sugar — the buyers and the sellers? — A. I do not. Q. Of course, you recollect the time when, under Secretary Sher- man’s order, all sugar imported was tested by tbe polariscope. What was the difference between the test made by the government and that made bv the importer, as a rule; was there any marked difference be- tween the two tests ? — A. The tests were made on a different basis. Tbe government test was made on tbe dry test, and the importers’ on the contents of the hogshead, which would, of course, give the differ- ence in tbe moisture of the samples of the sugar. Q. Of course; but the dry test being fixed as a rule, both parties 704 TARIFF COMMISSION. [EDWIN F. ATKINS. would be compelled to use that dry test, would they not?— A. Both parties are not compelled to, but the government is compelled to, ac- cording to the Secretary’s regulation. Q. I mean when an individual called on the government officer to test sugar by the dry test, was not the importer compelled to use the polariscope on the same basis ? — A. Yes, sir ; if he wished to check the test of the government appraiser. Q. Are you interested in the refining of sugar at all?— A. Yes, sir; but I come here to represent the importers principally. Q. In selling sugars to the importers, the sale, I believe, is usually made by the polariscopic test, and if the test is not equal to what it is said to be at the place where the sugar is purchased, what deduction is made for each degree it falls below the standard? — A. It is customary to allow on centrifugal sugar one-tenth and on muscovado sugar one- eighth to one-tenth per cent. Q. It is never less than one-tenth? — A. No, sir; not on centrifugal sugar. Q. And on muscovado it is one-eighth percent.? — A. That is accord- ing to the agreement; but the customary rate is one-tenth. I have bought both ways. In regard to centrifugals, it is the general custom to make an allowance of one-tenth per cent.; of course, I speak of the Boston custbm. Q. You do not speak of the New York usage? — A. No, sir; Idonot. Q. What proportion of the total amount of sugar refined in the United States is refined by the house with which you are connected ? — A. 1 have not the figures of the total refining capacity of the United States, and Therefore could not tell you. I can give you the capacity of our own house. Q. What is the capacity of your own house?— A. We have a capa- city of melting 300,000 pounds of raw sugars per day, or a little in ex- cess of that. Q. You cannot say what proportion that is to the aggregate amount refined in the United States? — A. I should not like to make any wide statement ; I should prefer to figure at it. WILLIAM AMORY. ] PORTLAND CEMENT. 705 WILLIAM AMOEY. Boston, Mass., August 26, 1882. Mr. William Amory, Jr., manufacturer of Portland cement, ad- dressed the Commission as follows : I noticed in the public prints that a few days ago an importer of for- eign cement appeared before the Commission at Long Branch aud as- serted that Portland cement could not be made in this country because no chalk existed here. I appear here for the purpose of proving by documents, which I shall submit on the subject of Portland cement, thait in the manufacture of it chalk is not necessary, nor is it used largely in the manufacture of such cement. I have here, first, the writ- ten statement of Mr. Crane, our superintendent, which I will read, as follows : New York, August 24, 1882. To the Tariff Commission : It having been represented to your honorable Commission, that “Portland cement ,y is not and cannot be manufactured in this country, I beg to state that I am the su- perintendent of a Portland cement manufactory, and have been engaged in the manufacture of Portland cement in this country for several years. Also, that the product of our manufactory has been pronounced by users and experts superior to the English manufacture, and equal to the German or French product. Also, that Portland cement is manufactured from either chalk and clay, or limestone and clay — the best cements of Germany and France being manufactured from limestone and clay — and that there are extensive deposits of limestone and clay in this country eminently suited for the manufacture of a superior quality of Portland cement. Appended hereto is the chemical analysis of Portland cement manufactured in England, in Germany, and this country, showing the articles to be similar in all es- sential features. Portland cement manufactured in this country was exhibited at the Philadelphia Centennial Exhibition, and was awarded a front rank by General Q. A. Gillmore, in his report on that class. A large amount of money has been expended in developing this industry, and man- ufacturers have to contend against false statements of importers, as well as the cheap labor of European countries, but, with improved machinery and reasonable protec- tion, this industry should become one of great importance in this country. At least 500,000 barrels are now annually imported from England, Germany, France, and Sweden, paying a lower tariff than most of the products of manufacture which have become well established in this country, and are in no need of protection. Sixty per cent, ad valorem would be a reasonable tariff, and would help protect the home in- dustry from the attacks of foreign manufacturers, who resort to every unfair means to prevent its development. Such tariff would also be in the interest of our natural cement manufactories, who represent a great and important industry, and would not increase the cost to consumers. Until recently the importers have had the monopoly of the United States market, and their prices have been arbitrary. With increased production here the cost of manufacture can be considerably reduced. I would be pleased to appear before your honorable Commission and give testi- mony as to this industry, and the advantage to be derived from its development, which may be greatly aided by a reasonable but protective tariff. Very respectfully, H. Mis. 6 45 T. T. CRANE. 706 TARIFF COMMISSION. [WILLIAM AMORY. Chemical analysis of Portland cements. Component parts. English. German. Wallkill. Lime 59.06 24 07 6. 92 3.41 57.1 23.2 9.2 5.12 59. 43 24.10 8. 13 Silica Alumina ( )xide iron Peroxide iron - 5. 17 1. 72 0. 85 ? 0. 34 > Injurious 0. 45 Magnesia ... 0.82 0. 73 ? 0. 87 J : 2.85 1.32 0. 58? 0. 70 J | 0.64 1.90 Potash Sulphate lime Carbonic acid Sand, &c 1.47 100. 20 99. 76 100. 19 I desire to call attention to this chemical analysis of the component parts of Portland cement made in this country, England, and Germanj^, showing that they are almost identically the same. In regard to the matter of the tariff charge of 20 per cent, ad valorem now imposed on the importation of Portland cement, presuming that a tariff' for revenue will be approved by the people, I would respectfully ask your board to recommend that this duty may be increased. Under- standing that an importer of Portland cement has appeared before you to advocate a reduction of this duty on the ground that this article is not made in this country, and cannot be, because chalk, a chief compo- nent in its manufacture, has nowhere been found, I would say in answer that the best Portland cements are made without chalk. One of the principal manufacturers in England, viz, at Rugby, making upw T ardsof 250,000 barrels per annum, and selling all his product at home because of its superior quality, uses no chalk. In France, Germany, and Swe- den, Portland cement is generally made of limestone and clay. It may be made of a variety of stone containing the requisite chemical proper- ties in correct proportions, or of limestone and clay, or of chalk and clay. One manufacturer in this country, using stone alone, is now-success- fully producing a good quality of Portland cement. A manufacturing establishment in ISTew York has proved that a variety of limestone and clay, conveniently located, exists there in inexhaustible quantities, and they are making from it a Portland cement in considerable quantity, which has proved beyond all question that their materials are suitable for a cement equal to the best imported English brands. It is probable that deposits of lime and clay suitable for this product will be found in every State. In England the manufacture of Portland cement was started in 1829, but with little success, till in 1859 the engineers on the London Drainage Works introduced its use on a large scale. In twenty -three years its manufacture there has increased from almost nothing to 5,000,000 bar- rels per annum. In Germany, in a much shorter time, it has increased to 5,000,000 barrels, and in France, Sweden, Russia, and other European countries to about as much more. If in those countries already possessing lime, Roman., and other cements similar to our Rosendale cement, fifteen millions of barrels have been made and used per annum, surely in this country there must be a similar want and pressing need. The high price at which Portland cement w T as at first introduced prevented its adoption for building till lately, and the importation has increased in the last four years from very little to about 500,000 barrels. The price WILUAM AMORY.] PORTLAND CEMENT. 707 has fallen from $7 to $3. At this or at a lower price the introduction is likely to be* rapid. At a higher price in New York this cement can- not be used in the West because of the added cost for distant delivery. Should the duty of 20 per cent, be taken off, it is improbable that the foreigner would sell lower on a market where he finds no home competition. Should the duty be increased, he is not likely to sell at higher prices, because this would limit a sale which at $3 returns large profit. The Western manufacturer has increased protection in the added freights. With the protection of a reasonable tariff, it is probable that in a few years Portland cement will be made in large quantities in every part of the Union. With increased protection, this industry must shortly have immense proportions. With or without protection, we must increase our use of Portland ce- ment, because we must find other materials for construction as substi- tutes for wood, now so rapidly diminishing in every State. Shall we send our gold to Europe in increasing streams to pay for millions of bar- rels of cement, for freights, insurance, and for profits to the foreigner ? Will it not be better for all interests that this new enterprise shall be assured a certain protection for a few years, and until if shall become well established and able to resist the attacks of the wealthy and pow- erful manufacturers of Europe, and to supply the wants of this country at prices far less than at present. The mysteries thrown about the manufacture of Portland cement abroad have now been brushed away. The methods are simple, easily understood, and open to all. Suitable materials have not hitherto been found because they have not been sought. Immense quarries of lime- stone and deposits of clay exist in nearly every State. Suitable vari- eties of both, in convenient situations for development, will doubtless soon be found and worked. Remembering how other industries have been protected in their in- fancy, and that this policy of our government has proved to be for the greatest good of the greatest number, I would ask you seriously to con- sider whether you cannot advocate a higher duty. I would further ask that the importation of Portland cement clinker, sent to this country to be ground and made into cement, be made subject to the same duty. By Commissioner Boteler : Question. Where are your works located ? — Answer. Temporarily at Carthage Landing, on the Hudson River. The principal works are at South Rondout, on the Walkill River. Q. There is a great deal of natural cement made there ? — A. Yes, sir $ 1,500,000 barrels of cement are made in that neighborhood every year, and we think an increase in the tariff would protect that industry also. Q. Have you any idea what the manufacturers in Ulster county, New York, produce ? — A. No, sir, I have not. I have only been informed that their product amounts to 1,500,000 barrels a year. Q. That is the Roseudale cement ? — A. Yes, sir. Our product is made entirely without chalk, which really does not exist in this country. This is made entirely of stone and without any clay, the chemical prop- erties all being contained in the stone cement which is dug out of the ground, and which is mixed according to a chemical analysis so as to produce the proper proportions. Q. Why is it that the Portland cement commands so much larger a price than any other American cement u ? — A. At the present prices, all 708 TARIFF COMMISSION. [WILLIAM AMORY. tlie manufacturers of Portland cement will tell you tliat it is much cheaper than any other kind of cement. Q. Do you say that Portland cement is cheaper? — A. Yes, sir-; in ultimate results to the user. In using Kosendale cement, for instance, it may be necessary to make one part of sand and one part of cement, while with this Portland cement it is only necessary to use one part of cement to three parts of sand, which reduces the cost, and the result is a stronger mixture, of greater binding power wherever it is used. Q. You say that one-third of the Portland cement and two-thirds of sand produces the same result that equal portions of sand and the Kosendale cement produce ? — A. I said one-fourth of the Portland cement and three-fourths of sand. It makes a stronger cement and is decidedly cheaper, a fact that is well recognized by experts. I do not wish in any way to criticise the Rosendale cement, because its use is vastly extended in preference to the use of lime and water, and there is no doubt that the demand will always continue. By Commissioner Ambler : Q. You say the Portland cement is also more certain in its results than natural Cement ? — A. Yes, sir ; the natural cement is made out of seams of rocks brought from different parts, and after a chemical an- alysis has been made, these component parts are mixed together so as to produce a certain result. Q. Is not that mixture found in the natural seam? — A. No, sir; it is not. Q. Do I understand you that the manufacture of Portland cement is a commercial success at present? — A. Yes, sir; our establishment has been running now a year and a half. It was established temporarily in an old flour mill, as we did not care to venture too far in buying costly machinery and buildings until we demonstrated the fact of its being a very good product. It has stood the highest tests to which it has been subjected, and it is universally approved by constructors, wherever it has been used, and there has been quite a demand for it for use in im- portant public works. The Scranton Steel Works, a company that is putting in the largest steel-rolling machinery in the world, have used it lately. They commenced to build on a quicksand in which they have had to sink 900 barrels of our cement. They would not have used it. of course, unless they had thoroughly examined as to its quality. We re- ceived an order yesterday for 100 barrels from a constructor on the W r est Side Railroad who had used 50 barrels previously within a fort- night, showing that he regarded our cement as the best and cheapest for his purpose. Q. Are there any other points where the Portland cement is made in this country besides those you have named? — A. I understand it has been manufactured in a careless and slovenly way at a point near Port- land, or further down the coast ; I do not remember the name of the place. I understand also that it has been manufactured on the Ohio River near Cincinnati; that large quarries of suitable limestone exist in that locality and also in Kentucky and in Maine. We all know that limestone exists almost everywhere. By Commissioner Boteler : Q. Is it manufactured on the Potomac River ? — A. I do not know whether it is or not. There is a Louisville company making limestone cement. Portland cement is entirely different from the natural stone cement. EDWIN S. BARRETT.] GOAT AND SHEEP SKINS. 709 EDWIN S. BARRETT. Boston, Mass., August 26, 1882. Mr. Edwin S. Barrett, of the firm of Edmands & Barrett, of Bos- ton, dealers in foreign goat and sheep skins, addressed the Commission as follows: I wish to speak to the Commission in regard to the repeal of the duty on East India tanned goat and sheep skins. I represent the importers of skins, and have here with me two gentlemen who represent the man- ufacturers of East India tanned skins, as well as one representing the shoe interest. The facts are these: Hindostan has a yearly product of 20,000,000 goat skins and about the same quantity of sheep skins. The sheep skins, to which we shall particularly allude, are what are called hair sheep, being a mongrel, or what might seem to be a crqss between a sheep, and a goat, although they are a distinctive breed, and their hair, or wool, is of little or no value, but their skins are tough and of a lasting quality, nearly as good as a goat skin, and far superior for shoe purposes to the wool-sheep skinsof any country. Of this 40,000,000 goat and sheep skins, all the hair sheep are tanned in India, and the larger part of the goat skins; the balance of the goat skins, some 6,000 bales, say 3,000,000 skins, are shipped to the United States, and known as East India raw skins. About an equal quantity, say 6,000 bales, or 3,000,000 skins, are shipped to this country after being tanned in India, and known as East India tanned skins; so, in one sense, the contest comes between duty or no duty on this 3,000,000 raw goat skins, untanned, against the 3,000,000 tanned goat skins tanned in India. There are no raw sheep skins (hair) shipped from India. So that this product of 40,000,000 skins will stand as follows, taking the last three years as a basis: Skins. Raw goat skins shipped to the United States 3, 000, 000 Tanned goat skins shipped to the United States 3, 000, 000 Tanned sheep skins shipped to the United States 3, 000, 000 Shipped to Europe, or absorbed in India for the wants of its own people. 31, 000, 000 Total 40,000,000 There are no raw skins sent to Europe, so that what Europe receives are in the tanned state. We are not referring in any way to wool-sheep skius. These skins are shipped from Madras, Bombay, and Calcutta, lirincipally from Madras, by steamers through the Suez Canal to London, with an average passage of sixty days from Madras to New York or Boston. Now, gentlemen, let us refer to the value of these East India goat and sheep skins, both raw and tanned. The 3,000,000 raw goat skins would average to cost 40 cents each, or $1,200,000; the 3,000,000 tanned goat skins would cost an average of 65 cents, with present 10 per cent, duty paid, or, say, $1,900,000 ; the 3,000,000 tanned sheep skins would average to cost, with the 10 percent, duty paid, 55 cents each, or $1,250,000; so the aggregate value of the tanned skins from India represents a value of $3,150,000 against an import of raw goat skins of the value of $ 1 , 200 , 000 . Now, here is the case in a nutshell: There are in the United States 710 TARIFF COMMISSION. [EDWIN S. BARRETT. about one hundred and twenty-five morocco manufacturers; about twenty-five of this number manufacture to a considerable extent in their factories these raw East India goat skins; there are fifty, or double this number, who manufacture the India tanned skins to a greater or less extent; some manufacture them altogether, and others use both India tanned skins, and also tan the raw skins, raw skins from other coun- tries as well as from India, and the remaining fifty manufacturers use Mexican, South American, and skins from other countries besides India. These twenty-five manufacturers of raw East India goat skins have prospered on the average better than any other branch of the leather manufacturing industry ; in fact, this is true of the whole morocco trade. These twenty-five manufacturers, seeing the rapid growth of the trade and manufacture of India tanned skins, which has already out- stripped their business, seek to retard it, possibly destroy it, by an in- crease of duties. A business of $1,200,000 per annum, still as large in volume as ever known, seeks to kill out a business of $3,150,000 per annum ; but the simple fact is, gentlemen, that the day for importing raw goat skins from India has gone by, for the reason that the produ- cers had rather sell their skins green to the home tanners than take the risk of drying and curing them for the United States; in fact, the United States is the only country that takes the raw skins away from India at all, every other country preferring to buy them tanned. An- other reason is, that India raw skins are double the cost of what they were twenty-live years ago, caused by the increased demand for morocco all over the world, particularly the United States, and being a low grade of skins the advance has been greater than in any other kinds; lienee the greater difficulty these twenty five India raw goat manufacturers experience in getting large profits; but, under any circumstances, duty or no duty, we cannot see how the importation of raw India goat skins is likely to increase. After long experience manufacturers find it safer to buy the skins already tanned, as for the past few years the quality of the tanned skins is much better relatively than the raw goods, and then the risk of tanning is always great, and has been particularly the case of late years, many manufacturers having suffered losses as high as 50 per cent, on certain invoices. Here is rather an interesting fact : Some dozen years or more ago the duty on tanned skins was 20 nr 25 per cent., and the National Morocco Exchange petitioned Congress to take off the duty or reduce it, and the duty was finally brought down to 10 per cent., where it is to-day. A few manufacturers wish it raised 25 per cent., making 35 percent., but only a few. The president of the National Morocco Exchange manufactures in his factory nothing but India tanned skins, and is in favor of removing the existing 10 per cent, duty; and this is the feeling among a large num- ber of the morocco manufacturers. Now let us look at the place this India morocco fills in the great leather industry : The United States j>roduce a very few goat skins, not enough to be worth considering. Our neighbor Mexico, x>roduces the best and highest grades. South and Central America, Curacoa, and Bio Hache produce high-priced skins, while large quantities are brought here from Europe, Asia, and Africa, all superior to East India skins, and representing in the total a yearly value of $10,000,000. Now, is it worth while to protect $1,200,000 worth of low-grade skins from India, or raise the existing duty, on a business which from the rapid growth of the morocco trade, and other circumstances which I have mentioned, must relatively decline? The comparative cost of labor between our country and India and EDWIN S BARRETT.] GOAT AND SHEEP SKINS. 711 Europe is in this case a matter of small moment One educated Amer- ican workman will do as much in a day as ten indolent East Indian laborers, or twice as much as the poorer paid European workman, and as citizens and men there is no comparison, and for this reason they receive liberal compensation. Now, let us see, gentlemen, who wear the India tanned goat and sheep skin shoe. The fashion of the day, and likely to be a permanent one among the female population of the country, is for a neat, serviceable button or lace boot; intact, women and children throughout the land demand and wear this for a best boot beyond any other kind. Now, boots from East India skins, of really excellent quality, can be bought at from $2 to $5 per pair, while those from the finer grades of morocco will cost from $5 to $12 per pair, and the great middling and poorer classes cannot afford to buy the higher priced article; and if ihe duty is raised 25 per cent, on India tanned skins, up goes the cost of every pair of shoes made from this leather, and all for the benefit of twenty-five wealthy morocco manufacturers, and against the protest of fifty other equally wealthy manufacturers of India tanned skins. The India tanned goat and sheep skins, after partially retanning here, make such hand- some and durable shoes that our wives and daughters think they are get- ting French kid when they purchase them, and even the best judges being unable to detect the India tanned skins from the higher cost Curagoa or South American, when made into a shoe, while our shoes for style, durability, and cheapness are unequaled in the world, thanks to the inventive genius and improved machinery of our artisans. Let us look for a moment, on broad and general principles, and see who wishes the repeal of the existing duty of 10 per cent, on these East India tanned skins. Every head of a family, every widow, every orphan, every person who wears a boot upon their feet, every boot and shoe manufacturer from one end of this broad land to the other; and I be- lieve, Mr. Chairman and gentlemen, if ever this question of duty comes before Congress, the representatives of fifty millions of people will sweep away this duty of 10 per cent. These twenty-five manufacturers, before alluded to, ask for an addi tional duty of 15 to 25 per cent, on these skins, which already pay 10 per cent.; if they cannot get 25 per cent, they will take what they can get. Thus, with the utmost selfishness and greed, they seek to fasten upon the great middling and poorer classes a large additional cost for their boots or shoes from India leather. We claim, Mr. President, that they need no protection whatever; they are prosperous now and will continue to prosper if this 10 per cent, duty is repealed. They are sub- ject to the changes in business, or to the wants and tastes of the people, the same as all branches of business, particularly in manufactures. If East India skins are not profitable, they can buy other kinds ; there is always a large variety to choose from. Manufacturers of East India tanned skins have built large factories and filled them with machinery, and employ large numbers of workmen, thinking very properly that the existing duty of 10 per cent, would be retained or repealed, knowing well that the sentiment of the country was against any increase of the duty, particularly on raw or unfinished goods. Mr. President and gentlemen of the Tariff Commission, we most re- spectfully ask that you make a favorable report on our petition for the repeal of the existing duty on India tanned goat and sheep skins. Mr. Ira S. Franklin and Mr. Marcus Beebe, of Boston, who were 712 TARIFF COMMISSION. [EDWIN S. BARRETT. present during the hearing, stated that they indorsed the views ex- pressed by Mr. Barrett in every respect. Mr. Franklin said : As a manufacturer of East India tanned goat and sheep skins, I desire to state to the Commission that an increase of the duty from 15 to 25 per cent, would throw me out of business en- tirely. By Commissioner Garland: Question. Do these skins come here tanned"? — Answer. Yes, sir. Q. What is meant, th£n, by raw skins'? — A. Skins taken from the ani- mal and dried with the hair on. Q. Do you import any skins in that condition"? — A. No, sir; I make a specialty of working in tanned goat and sheep skins; working them into morocco of different kinds. By Commissioner McMahon : Q. Do you agree to the statement made by Mr. Barrett that it would make a considerable difference to the consumer in price? — A. Yes, sir; a vast difference. Q. How many skins does it take to make a pair of lady’s boots'? — A. It only takes a portion of one skin; about one-third to one- fourth of a whole skin will make one pair of boots. The sizes of skins vary. Q. What is the average price for that skin in India in the raw state % — A. It is 40 to 65 cents for tanned skins. Q. What is the rate of duty that you recommend now? — A. Thirty- five per cent. By Commissioner Garland: Q. It was stated that this East India product is cheaper than that obtained at any other point? — A. Yes, sir. Q. Why is that? — A. Because it is of a poorer grade. It has the lower price of an inferior skin. By Commissioner Porter: Q. So that practically it does not interfere with anything produced in this country? — A. No, sir; it does not. But there is nothing pro- duced in this country to make a shoe that will equal it in appearance for the price, although it cannot compare with the French skins in du- rability. A. E. DENISON.] POTATO STARCH. 713 A. E. DENISON. - Boston, Mass., August 26, 1882. Mr. A. E. Denison, attorney at law, Boston, Mass., on behalf of the potato-starch manufacturers of the United States, made the following statement : I represent about one hundred and twenty manufacturers of potato starch in the United States, who have signed a petition which 1 shall submit to you at the close of my statement of our case. I fliay as well state at the outset that what we desire the Commission to recommend to Congress is, that the duty on potato starch shall be increased from 1 cent per pound and 20 per cent, ad valorem, the present rate, to 2 cents per pound specific duty, and also to place the same duty on farina, dex- trine, and gum substitute. This request is based upon the following con- siderations : By the census of 1870 there were in the United States 195 establish- ments engaged in the manufacture of starch, employing 2,072 hands; with capital invested of $2,741,000; paying in wages, $900,719; with value of material, $3,884,909, and value of product, $5,994,422. Of these establishments, 72 were in the State of New York and 66 in New Hampshire, and the statistics respecting them were as follows: New York. New Hampshire. Establishments 72 1, 348 $1, 895, 375 776, 855 2, 929, 018 4, 678, 413 66 294 $246, 200 233, 381 308. 695 405, 242 Capital . Material Product The statistics for New York include the extensive corn-starch manu- factories of Kingsford and Duryea, embracing a large proportion of the capital invested, wages paid, and material and products. The statis- tics for New Hampshire fairly represent the industry in the United States for the year 1870. In the year 1870 the production of potatoes in the United States was 143,337,473 bushels, and of this amount there were raised in — Maine New Hampshire Vermont New York Bushels. 7 , 771,363 4 , 515,419 5 , 157, 428 28 , 547 , 593 A total of 45,991,803 bushels in these four States, or nearly one third of the entire crop for that year. The statistics of the census of 1880 are not yet available, but careful 714 TARIFF COMMISSION. [A. E. DENISON. observers, men long engaged in the business, are of the opinion that at the present time there are not over 175 potato-starch establishments in active operation, with a capital invested not exceeding $2,000,000, and located almost entirely in the States of Maine, New Hampshire, Ver- mont, and New York. It may fairly be claimed to be a New England industry. By reason of unfair discrimination in the laws regulating the tariff, the industry has made no progress in the past ten years. The great competitor in this market for potato starch is Germany. In fact, the greater proportion of potato starch and its products imported into this country comes from Germany, where potatoes are raised in such immense quantities that in 1876 the product of green starch was 91,000,000 pounds and of dry starch was 11,000,000 pounds. There, immense sections of the country are planted with potatoes; the 3 r are tended by women and children almost entirely, and when harvested are stored in iiflmense pits or silos. From these pits the good potatoes are marketed, while the small and refuse ones go to the factory to be manu- factured into starch and grape sugar. By reason of the temperate climate and the facilities for storing the material in pits, the German factories are enabled to run the year round. In this country, you will readily understand that it is impossible to store potatoes in large quanti- ties in the States where the potato-starch industry is carried on, by reason of the cold climate and the great and disproportionate expense, and, therefore, the season of running starch factories is limited to the time from harvesting to the middle of December, a period of not over two to three months in each year. To a proper understanding of the subject, you will please consider that starch is one of the most extensively diffused and one of the most useful ingredients contained in plants, and, when separated from the fibrin or cellulose containing it, has a very wide application in every- day life. While all plants contain starch to a greater or less extent, the number which contain it in sufficient quantities to manufacture is lim- ited, both in Europe and America, to potatoes, wheat, rice, and corn. It is used for multifarious purposes, such as the sizing of paper; large quantities in the manufacture of paper, and also in the manufacture of textile fabrics; powdering in metal foundries in place of powdered charcoal; in the production of whiskies, brandies, beer, and ale; in house- hold for laundry purposes, &c. In these and various other ways potato starch is used in greater quantities than any other because of its cheap ness. With reference to its chemical nature, it belongs to the hydrates of carbon or to that group of organic bodies which, besides carbon, contain hydrogen and oxygen in such proportions that they could form water when combined with each other, and in this group of hydrates is found fibrin or cellulose, starch, dextrine, cane sugar, grape sugar, &c. In its elementary composition, starch is composed of twelve equivalents of carbon, ten equivalents of hydrogen, ten equivalents of oxygen, and hence the chemical formula CcHmOs. A distinguishing characteristic of starch is its insolubility in cold water. Prior to 1810 Arabian and Senegal gums were alone used in finishing calicoes. In that year, owing to the continental blockade, Arabian gum was unusually scarce and high in the European market, and calico printers began to cast about for a substitute. By accident Bouillon Lagrange made the important discovery that starch, when slightly roasted, acquired the property of solubility in cold water, producing a mucilaginous or gum-like liquid. The discovery was immediately util- ized with gratifying results, and the torrified or roasted starch has held A. E. DENISON. J POTATO STARCH. 715 its place as a substitute for the more expensive Arabian and Senegal gums to the present time. Since this discovery by Lagrange various experiments and investigations have been made by various chemists, and various methods of roasting or burning or transforming starch have been tried. In 1833 Biot and Persoz, chemists, were experimenting with this roasted starch, and made the discovery that when polarized light is passed through a solution of it the plane of polarization is turned to the right instead of to the left, as in solutions of Arabian gum, and hence gave to it the name, which it has since borne, “dextrine,” from the latin dexter , right. In commerce this substance is known by a variety of names, such as British gum, a name given to it by calico printers, referring to its discovery, roasted starch, starch gum, gum sub- stitute, fruit gum, and other names. But by what ever name it is known, to whatever use it is put, or by whatever means it is produced, whether by roasting in pans, by boiling in kettles with acids, or by the action of diastase, dextrine is always composed of the same elementary bodies/and always corresponds to the chemical formula O 6 H 10 O 5 , and is of pre- cisely the same composition as starch, despite the various physical modi- fications in which it occurs. They all mean such preparations as have been obtained by the artificial transformation of starch. The uses of dextrine are manifold, and constantly increasing, on ac- count of its inexpensiveness as compared with Arabian and Senegal gums. Among its principal applications may be mentioned its use in the art of printing cloth, for thickening and preparing mordants for fast colors, and generally for the finishing and stiffening of textiles. It is also used in the production of colored and tinted papers, for gumming envelopes, postage-stamps, and labels. It is a necessary ingredient in the brewing of beer, and, in general, its uses as well as its composition are identical with starch, from which it is derived. By the statutes of the United States, § 2504, Schedule M, the duty imposed upon starch made of potatoes or corn is 1 cent per pound and 20 per cent, ad valorem, while by a strange inconsistency this slight pro- tection which is given to our own farmers and manufacturers is prac- tically nullified by admitting dextrine at 20 per cent, duty, and gum substitute 10 per cent. duty. You must seethe injustice and absurdity of these provisions of the statute at once, and we ask you to remedy the injustice as far as it lies in your power to do. We ask, what it seems fair to expect, that a specific duty of not less than two cents per pound be laid upon starch, dextrine, gum substitute, or by whatever name transformed starch may be called. Such a duty would be for the benefit of the manufacturer, the producer, and consumer. First. As to the manufacturer. It may be stated that no potato starch is exported from this country*, all exports under the name of starch being corn starch for domestic uses. The average consumption of potato starch and its products in the United States is from 8,000 to 10,000 tons, and of this amount from 1,800 to 2,000 tons, or nearly one-fourth, is imported. The average price of potato starch for the past five years in the Boston and New York markets, as found by a careful compilation of prices by a large and well-known manufacturing house, has been 4- L % cents per pound, while for the five years preceding it was 5^-J cents per pound. The price has been gradually declining from year to year until the present year it is higher, owing to the almost total failure of the potato crop for 1881. This decline in prices is owing almost entirely to the foreign supply, and the importation of the products of starch under the name of dextrine, gum substitute, roasted or burnt starch, &c. In order that 716 TARIFF COMMISSION. [A. E. DENISON. any margin of profit at all be realized by manufacturers at current prices for the past five years, farmers have been obliged to sell their crops at from 25 to 30 cents per bushel to the manufacturer, andthisprice is as low as the farmer can go and realize any thing for his crop. An examination of the report of the Department of Agriculture for the year 1880 shows that in Maine the average price of potatoes per bushel for that year was 48 cents, in New Hampshire 44 cents, in Vermont 42 cents, and in New York 42 cents, while in every other State in the Union except Iowa and Minnesota the price ranged from 58 cents to $1.29 per bushel. At these prices it would be impossible for our manufacturers to even pay for the potatoes with the starch, saying nothing about wages, freights, &c., hence they are obliged to move away from market centers and locate in places where land and labor are cheap, where the cost of production is reduced to a minimum ; and it will be found, when the census of 1880 is published, that Northern New York and Aroostook County, in Maine, are the great starch manufacturing regions of this country. It takes 250 bushels of potatoes to manufacture a ton of starch, and at 25 cents per bushel, a low price, is $02.50 as first cost of material. Add to this the estimated cost of manufacture, for wages, packing, freights, insur- ance, commissions, &c., $22, and we have as cost per ton $84.50 ; at av- erage price per pound, 4^- cents, $88.33, showing average profit per ton of $3.83. This means, with consumption of 8,000 tons, a total yearly profit to our one hundred and seventy- five manufactures of $30,640 on an invested capital of $2,000,000. As the foreign importations run the price lower and lower, farmers refuse to plant, and the result will be that our manufacturers must eventually abandon the trade, sell their facto- ries for what they can get, pocket the loss, and leave consumers to the mercy of the foreign trade. With the protection that is asked, a fair profit and only a fair profit can be realized. Second. Such a duty would benefit the farmer and consumer. The consumer of starch and its products cannot be materially affected, because Arabian and Senegal gums are at hand and the foreign manu- facturer stands ready to step in and supply the market at a minimum of profit. In any event the price of starch cannot largely be affected by the increase of duty proposed, not more than one half a cent per pound or about $10 per ton, and this disadvantage, if you choose to call it so, is more than offset by the advantages accruing to the farmer and con- sumer of the potato as an article of food. Starch factories insure a good plant of potatoes in the locality where they are located, and give to the farmers a double chance for a good price for his crop — first, at the factory ; and, second, for ordinary consumption. If marketable potatoes are high, of course he markets the best and the factory takes the refuse. If low, he can haul his crop to the starch factory and always obtain a fair cash price. Farmers are a conservative class, and in the locality of these factories would never think of taking the chance of a large plant on the uncertainty of the market alone. This industry has been in a large measure the making of Aroostook County, in Maine, and the presence of its twenty-five potato-starch fac- tories insures every year a large plant, a prolific yield, and a large sur- plus for our markets, greater by far than any other section of New England produces. The same is true of the northern counties in New York ; and in the States where this industry is followed to any great extent you will find that the average market i^rice of potatoes is the lowest. As the direct result of the presence of potato-starch factories in New England, domestic consumers, the poor in our large cities, and the op- A. 1£. DENISON.] POTATO STARCH. 717 eratives in our manufacturing towns can buy this important article of food cheaper than they otherwise could, and are directly interested in the protection of this industry. In the town of Caribou, Me., in the year 1880, there was raised a surplus of 250,000 bushels of potatoes, and of this large amount the starch factory consumed 100,000 bushels, 100.000 bushels were marketed, and the balance were left on the farmers* hands, because the factory could not use them to advantage. The pro- prietor of the factory there writes that “if there was no factory there that town would not raise 25,000 bushels of potatoes to take the chance of a shipping market.” What is true of Caribou is true of every town where a starch factory is located. Take away the duty on starch and its products, and Germany, New Brunswick, and Canada will wipe out every factory in this country in two years. Increase the duty and put the American manufacturer on a level with his foreign competitors and enable him to make a fair profit on his investment, and the benefit accrues not alone to him, but to the farmer and the consumer as well. The figures in relation to the cost price of starch were furnished to me by Mr. Eustis, of the firm of Eustis & Aldrich, from his books, and the entries on this subject extend over a period of more than ten years. By Commissioner Porter : Question. Do I understand you to say that this industry has de- creased 1 ?— Answer. I have made the statement that it has made no progress in the last three years. I think you will find by the census re- port s that it has decreased. If you go through Northern Vermont and New Hampshire you will find the starch factories abandoned, and the business has been driven to Aroostook County, Maine. The following petition has been signed by about one hundred and twenty manufacturers of potato starch, and they have commissioned me to present it to you. They say — “We, the undersigned manufacturers of potato starch, respectfully present the following statement of facts: “There are in this country about two hundred potato-starch factories, employing a capital of about $2,000,000, and producing from 8,000 to 12.000 tons of starch per annum. Many of these factories are unable to run at present because of the low price consequent upon the importation from Europe of farina, potato starch, flour dextrine, and gum substitute. The manufacture in this country can only be followed during two or three months of the year. The manufacturers, as a rule, are in moder- ate circumstances, the business never having been more than reasonably profi table. “The farmers in the vicinity depend upon the starch factories for a market for their potatoes, this being their chief cash outlet. Under the existing tariff the duty on potato starch is 1 cent per pound and 20 per cent, ad valorem, while farina is on the free list. In England potato- starch is known, and is always invoiced, as farina; and, as a matter of fact, potato starch (in large lots) has been imported from Europe under the name of farina, and has been so entered and passed as free goods at the custom-houses of New York, Philadelphia, and Boston. The fraudulent imports would have seriously damaged the interests of starch makers but for their timely detection and for prompt representa- tions to the Treasury Department, which led to the collection of duties and penalties. “ Roasted-potato starch is known as dextrine, also as gum substitute. The duty on the former is 20 per cent., and the latter pays 10 per cent, ad valorem. These two being practically one, it is not reasonable that 718 TARIFF COMMISSION. [A. E DEXISON'. so important a product of potato starch should be admitted at a rate of duty so much lower than on starch itself. a The rate of duty on starch, other than corn and potato, is 3 cents per pound and 20 per cent, ad valorem. A fair protection of the potato- starch industry demands that the duty should not be less than 2 cents per pound $ and that dextrine and gum substitutes, which are made from potato starch by roasting, should be subject to at least as much duty as starch itself.” Mr. A. S. Etjstis, of the firm of Eustis & Aldrich, Boston, Mass., said: I can indorse and confirm all that Mr. Denison has stated. I am en- gaged in the manufacture of potato starch in the State of Maine, and have a practical acquaintance with the business. I have two factories that cost me $10,000, which I would be willing to sell for $100 apiece, for they cannot be used in the present condition of the business. 1 tried to run one of them last year, and lost money in the attempt. We had to import some potatoes from Ireland last winter on account of the scarcity of potatoes in this country. But our great trouble is caused by the importation of potato starch f rom abroad. We cannot compete with the foreign manufacturers unless we have a higher protective duty. We only run our factories a few months in the year. But Mr. Denison has stated the case so fully that I need not enlarge upon the subject. FRANK M. AMES.] SUGAR CULTURE. 719 FRANK M. AMES. Boston, Mass., August 26, 1882. Mr. Frank M. Ames, of Canton, Mass., addressed the Commission as follows: I represent the sugar interest of Louisiana. We are so unfortunate as to own some 10,000 or 11,000 acres of land opposite the city of New Orleans. Thirty-five hundred acres of this land were cultivated for sugar before the war. We have only cultivated about 1,300 acres for this purpose; and 200 to 300 acres have been cultivated for rice a por- tion of the time. We commenced the cultivation of the land in 1872, and have paid for labor and supplies $735,330, and for new construction and improvements about $51,370, making a total of $806,700, or $80,670 on an average each year. Five hundred and six thousand dollars have been paid for labor in cultivating and taking off the crops, and probably $50,000 more for labor in and about the premises that is not shown in the labor of cultivation, making about $556,000, or $55,600 each year. We have made 10,043,164 pounds of sugar, or an average of 1,004,316 pounds each year. The molasses made averages about one sixth in value of the whole crop. This would show that the sugar has cost us an average of 6.72 cents per pound. About 70 per cent, of the cost has been for labor, and 30 per cent, for supplies. This would show that the cost for labor has been 4.61 cents, and for coal, wood, grain, mules, and repairs to ma- chinery, &c., 2.01 cents per pound. The average wages, including taking off the crop, will average over $1.25 per day, to which must be added house-rent, fuel, &c., for which no charge is made. If we are correctly informed, the cooly and slave labor of Cuba and other sugar countries will not exceed 40 cents per day. Parties esti- mate it as less than 30 cents. This would show that the cost of labor in Louisiana is from three to four times greater than the average cost in other sugar districts; or while our labor costs 4.6 cents per pound, it costs but 1.15 to 1£ cents in other districts. If these data are correct, it will be seen why sugar-making in Louisiana has not been profitable to the planter, while it is profitable to the producer in other countries. The difference in cost of labor is from 3.1 to 3.45 cents, while the duty will average about 2.45 cents per pound. Theie are some 350,000 to 400,000 people in Louisiana alone who are directly dependent on the sugar interest for support, and the supplies for these people are mostly produced in the Northern States. Probably 700,0ti0 people are supported by this industry. The average value of the sugar crop of Louisiana for the past five years has been about $15,000,000. If the duty were put to where it was prior to the advance of 25 per cent, in 1875, it would, in my opinion, be fatal to the sugar, sorghum, and maple-sugar industry of the United States. The sugar lands of Louisiana are not adapted to the cultivation of other crops, being too far south for cotton, corn, or wheat, and if the cultivation of sugar is abandoned, I know of no crop that could be suc- cessfully cultivated on these lands. The sugar crop is as sure as any other crop in the United States, 720 TARIFF COMMISSION. [FRANK M. AMES. as the experience of the past year has proved. Perhaps if the duty were removed from every article imported, the planter might hold his own, hut so long as the wage paid to the American laborer is so much greater than paid in any other country, it must be protected against the slave and pauper labor of those countries. The constant agitation of the tariff question prevents the intelligent expenditure of money by the Southern sugar planter. The money he has spent for improvement has been from necessity and in order to sgcure the growing crop. Could he have had the assurance that the duty now levied on sugar would have remained as long as it has, he would have been in much better condition to-day, as he would have made improve- ments that would have been durable and lasting, instead of make shifts for immediate and temporary advantage. With improved machinery he would have been able to extract more juice from the corn and make better sugar from that juice. If he could be assured that the present duty would remain for 5 years, he would be warranted in making permanent improvements, and in 10 years he would be in a condition that would secure him against loss, even though the duty were reduced 50 to 75 per cent. Another disadvantage the planter has had to contend with is the floods poured down from the rivers of the North. Now that the general government is about to undertake to control tliose floods, he will be in a better condition than before. The present duty is such that with slight change and the use of the polariscope, and the honest collection of the duty, the planter will be able to secure a reasonable profit, although not half that made by many manufacturing or farming interests of the northern section of the United States. I have here a statement showing the cost of cultivation, taken from our books, from 1872 to 1881, inclusive, as follows : Labor, wages paid $506,307 Supplies and repairs 249, 023 Improvements and new construction. 51, 370 806, 700 Sugar made pounds . . 10, 043, 146 Average cost of crop, yearly $80, 670 Average yield of sugar, yearly pounds.. 1,004,314 Labor as above is about G2J per cent, of cost of crop, to which should be added 6 or 7 per cent., which is covered in the items of supplies, re- pairs, improvements, and new construction given above. By Commissioner Kenner: Question. Do you reside in Massachusetts the principal part of your time, or your whole time? — Answer. I am in Louisiana about two months in the year. Q. How long have you been cultivating sugar in Louisiana? — A. I commenced making it there in 1872. Q. Did you ever cultivate sugar on any of the islands, or in any for eign country? — A. No, sir. Q. These figures that you have given us are taken from your books, and therefore are absolutely correct? — A. Yes, sir. Q. Did you make sugar good enough to ship to Boston? — A. Yes, sir ; in small quantities. I shipped it for my own use, and also my sugar is being used by one of the sugar refiners in this city, Q. Do you mean being used for consumption ? — A. Yes, sir, for con- sumption. The color of my sugar is not equal to that of refined sugar, and FRANK M. AME8.J SUGAR CULTURE. 721 it will not sell for the price of refined sugar, although actually there is more saccharine strength in it, and the same amount goes further than the same amount of refined sugar. Q. From your knowledge of the cultivation of sugar in Louisiana, do you think that with proper protection that State would make enough, sugar to supply the wants of the people of the United States f — A. I cannot say that it would make enough, but I think it would make nearly all that is required in this country. Louisiana, Alabama, Mississippi, and Texas could make more than the amount required in the United States. Q. You allude to the polariscope in your statement ; do you recom- mend its use by the government ? — A. Yes, sir. Q. On what is that recommendation based; your knowledge of the polariscope, or from hearsay V — A. It is based on my own knowledge of its working. Q. Do you use it on your own plantation ? — A. Yes, sir ; for testing the juices and the products of the juices, from the time we take the saccharine matter from the cane until the sugar is made, in order to get the richness of it and to be able to locate the best quality of cane. Q. Is this sugar, of which you have iiroduced a sample, the same that is used by the refiners ? — No, sir ; this is a finer grade, although it is taken from the same sugars. This sugar that I have here has gone through a granulator. It has not been refined, but it has been put through a granulator. I have with me a letter from the superintendent of the refinery in regard to this sugar, which I will read : Boston, Mass., January 17, 1882. Mr. F. M. Ames, Canton^ Mass,: Dear Sir : Yours of yesterday is at hand. The sugar you sent to be dried was better this year than last, not being quite so gummy, there- fore working better in the granulators. The polarization of this last lot was 98.4 ; moisture 1.4, making dry polarization or exponent to be 99.8, which is very good. There will be no bill for granulating, as what lumps and tailings from granulator there are, which are not of much use to you, will amply repay us for whatever expense we have been to. I remain yours, truly, J. H. WEBSTER. The granulator is a revolving cylinder containing a steam drum, which makes it very hot and takes the moisture from the sugar. The sugar loses 1 per cent, in that process. This sugar is being used by a num- ber of people in this city in their households. Mr. Peabody, of the firm of Peabody & Co., told me within a week that it is the best sugar he had ever had in his house ; they like it better than any sugar they have ever had. It is absolutely pure so far as it is possible to make it pure with- out putting it through a refinery. H. Mis. 6 46 722 TARIFF COMMISSION. [C, NORWOOD & SON, 0. NOBWOOD & SON. Boston, Mass., August 26, 1882. The following communication from Messrs. 0. Norwood & Son, of Boston, in regard to the duty upon isinglass, was ordered to be printed: We, the undersigned, manufacturers in the United States of “ ribbon isinglass ” from “fish sounds or bladders,” respectfully represent that we have invested in our business a capital of about $800,000, and employ, during that part of the year when the weather permits the operation of our works, about 250 men. The “ fish sounds or bladders” used by us are rarely used, and have but small value except for the purpose of our manufacture ; consequently all persons engaged in the fisheries are interested in its continuance. The manufacture of such isinglass is of comparative late date. In 1872 only about $150,000 was invested in it in this country. At the above date, when the present tariff law was enacted making such “ isinglass” free, there were no manufactories of any importance in foreign countries, and none of it was imported into this country. During the past three years, however, several manufactories have been organized and put in operation in Europe. The fisheries of Norway and Sweden afford an ample supply of the crude “sounds or bladders” at a low price. This, coupled with cheap labor and admission into this country free, has enabled the foreign makers of “isinglass,” through their agents in this country, to bring it here, within the past two years, and put it upon the market at a price per pound nearly as low as we pay for the crude “ sounds or bladders.” This is ruinous to our business. If it continues with its natural growth arising from the above advantages in the hands of the foreign maker, it will be impossible for us to continue our manufacture except at a loss. We therefore respectfully ask that in the tariff bill (the preparation of which has been intrusted by Congress to you) you will provide for “ ribbon isinglass” at a rate of duty which will enable us to continue the manufacture of such merchandise in this country without suffering a loss thereby ; and respectfully suggest the rate to be 40 per cent, ad valorem, or its equivalent, a specific duty of 30 cents per pound. There is a large shrinkage or waste in the manufacture, and the sug- gested rate of duty will be only sufficient to enable us to compete with the foreign maker in our markets. Inasmuch as our own fisheries have not, at times, produced sufficient of the crude article to supply our wants, it has been necessary for us to buy in foreign markets (the British provinces mainly). We would there- fore ask that “fish sounds or bladders unmanufactured” shall be in- cluded in the “ free list.” Should any more detailed statement or particular facts pertaining to this matter be desired by you, we shall be pleased to furnish the same upon being advised thereof. C. Norwood & Son. Howe & French. Haskins Brothers. m Boring Grimes. TIICMAS G. KICK. | appraiser’s department, boston. 723 THOMAS G. RICE. Boston, Mass., August 26, 1882. Mr. Thomas G. Rice, examiner, appraiser’s office, Boston custom- house, appeared before the Commission and was interrogated as follows: By Commissioner Garland: Question. I would like to inquire what your experience has been in regard to the matter of undervaluations when an ad valorem duty is paid. Have you met with instances where you considered that the goods had been purposely undervalued abroad in order to escape the payment of duty here? — Answer. Yes, sir ; I have had my suspicions very strongly aroused in that direction, but I have met with difficulty in obtaining sufficient evidence to sustain them. I have no doubt that the duty on wool is evaded. By Commissioner Ambler : Q. Could you suggest any method of collecting such duties, which would restrict this evil? — A. It seems to me that if you reduce the specific and increase the ad valorem duty, without having any di- vision line, you would secure uniformity, and also I think protect the revenue even more than it is protected under the present tariff, for the reason that the percentage of the value would be so slight that the in- ducement would not be as strong as now to undervalue. Take third- class wools, costing 12 cents a pound. We have invoices coming in here where the value is placed at cents a pound. The man does not live who can estimate within of a cent a pound what the value of wool is. If you make a tariff without any of those divisions in it, I think it will greatly obviate or do away with the trouble I have spoken of. Q. Would it not be better to make an absolutely ad valorem duty and take the value of the goods in this country as the basis? — A. No, sir ; I do not agree with you as to taking the value of the goods here. Q. Is not their value here as easily ascertained? — A. No, sir ; I think not. I think that system would be open to other objections also. Q. What other objections ? — A. In the first place, there are differ- ences in the rates of freight in bringing the goods to this country. Fur- thermore, these importers are wide awake and up in the times, and if they wanted to evade the duty they would ascertain at what port the value of wool, or afty other article, would be likely to be lowest, and their shipments would go there largely. I suppose, also, that in foreign countries they are on the lookout to fiud a market for their manufact- ures. Supposing they offered a drawback for such merchandise as was exported; they might make their drawback equal to the duty on the goods imported here, and then the goods are brought here in competi- tion with us. I believe the matter of home valuation was tried in this country and found not to be practicable. Q. When was it tried here? — A. I think you will find that the act of 1779 provided for it. I have not read the law carefully, but I infer that it provided for a home valuation ; that when merchandise paid only 5 per cent, ad valorem, the value of that merchandise should be taken at the place of importation. That continued up to 1795, and then they assessed the duty on the foreign value at the place of expor- 724 TARIFF COMMISSION. | THOMAS G. KICK. tation. That continued until 1833, and then they assessed the home valuation until 1842. Since that time we have rated the goods at their value iu the principal markets of the country from whence they are im- ported. By the President : Q. Have you ever considered the subject of the creation of a customs court? — A. Yes, sir; I have. Q. Have you ever made a statement of your views on that subject to the Secretary of the Treasury? — A. Yes, sir; I wrote to him concern- ing it. Q. Can you give in substance your views? — A. I stated to him that my opinion was that a tribunal or board of arbitration consisting of five persons should be appointed, with headquarters at New York City. They should be appointed by the President, to hold office for life or during good behavior, and they should receive a salary commensurate with the services performed. Monthly meetings of the board should be held. Hearings might be had at the different places where these judges resided, and evidence might be taken and submitted to the whole board in writing at the next meeting. If such a system was adopted, a just conclusion would be arrived at with much more dispatch than under the present system, and ninety-nine times out of a hundred the decision would be more correct and give more satisfaction to the im- porter, besides saving numberless suits and much litigation. By Commissioner Garland : Q. You have referred to this dividing line, which is 32 cents in the the wool tariff’. Is there any considerable amount of wool imported valued above 32 cents? — A. No, sir; but I think anyone will readily see that a division of that kind shuts out a large amount of wool that might come here. Take South American wool, for instance, and some qualities of the Cape wool. The specific duty on them would be the same as on the finest Australian wool. Suppose Buenos Ayres wool costs 18 cents a pound and Australian wool 24 cents a pound, there would be a difference of six cents, and the ad valorem would be the only difference in the duty you would have to pay, and the Australian wool is much more valuable. By the President : Q. Your proposition is to lower the specific duty and increase the ad valorem duty? — A. Yes, sir; and have no dividing line. Q. To apply that principle to all?— A. Yes, sir. By Commissioner Garland : • Q. Your impression is that that would increase the importation of the lower-priced wools? — A. Yes, sir; the removing of that dividing line would have that effect. Q. And not only that, but, adopting your suggestion, would it not di minish the specific duty and increase the ad valorem duty?— A. I don’t know whether that would affect it or not. I do not make a recommendation to reduce the duty on wool; I merely suggest this as a proper method. Q. But you do suggest that the specific duty be decreased and the ad valorem duty increased? — A. Yes, sir. Q. What effect would that have on the importation of wool? — A. As to the quantity of wool imported, I do not think it would affect it at all, but I think it would secure the government against evasions of the xhomas g. bice. APPRAISER^ DEPARTMENT, BOSTON. 725 duty which uow exist. The inducement would be much less to under- value than it is now. Q. What is the character of the wool in regard to which these evasions are practiced ? — A. I should say it was principally the fine third class carpet-wools. By the President : Q. Supposing the duties were made specific, say 2 cents a pound on the unwashed and three to four cents on the washed wools; would that have the effect of taking away that dividing line ? I mean, supposing a specific duty was put on carpet wools and double the duty was put on washed wools? — A. I think that would prevent fraud, for it would not make any difference what it cost ; they would have to pay a specific duty at so much a pound without regard to the cost. By Commissioner Garland : Q. Have you met, in the performance of your duties, with any wools of the third class that should be rated above that class? — A. No, sir; the tariff provides for wools of merino blood, immediate or remote, and sometimes w r e have a question as to whether there is any merino blood in the importation or not! I do not know of any attempts that have been made to enter first or second class wools as third-class wools, by mixing them. By the President : Q. Is there any difficulty in carrying into practical execution the present classification of wools? — A. No, sir; I do not find any. Of course we have questions arise, as I have stated, to determine which an expert has to be called upon, but I do not know of any other tariff we could have, so far as that matter is concerned, which could be more easily executed than this. By Commissioner Garland : Q. At present it is a mere question of judgment between the ap- praiser and the importer. — A. Yes, sir; it is a question of judgment, of course, and we have to decide from the samples that are before us. 726 TARIFF COMMISSION. [EDWIN G. ANGELL. EDWIN G. ANGELL. Boston. Mass., August 26, 1882. Mr. Edwin G. Anoell, president of tlie American Screw Company, Providence, R. I., addressed the Commission as follows : Gentlemen : The tariff approved June 30, 1864, reads as follows : On screws, commonly called wood screws, two inches or over in length, eight cents per pound; less than two inches in length, eleven cents per pound. On screws of any other metal than iron, and all other screws of iron except wood screws, thirty-five per centum ad valorem. There are upon the usual wood-screw list one hundred and eighty- live standard sizes that may be imported into this country by the man- ufacturers of Canada, England, France, or Germany, said sizes rang- ing in length from J inch to 6 inches, and in diameter from No. 0 to No. 30 screw gauge. The present tariff being specific bears very unequally upon different portions of the list, the ^-inch No. 0 screw costing more than twenty times per pound that of the lf-inch No. 24 screw, paying the same duty, viz, 11 cents per pound. While, therefore, the first mentioned must be manufactured at a loss (when duty paid upon rods is considered), the latter is over protected, and those who claim that there is too much protection on screws usually base their arguments upon these and similar goods, ignoring entirely the other and major portion of the list. Most of the iron from which screws are made must of necessity come from England or Germany, and in manufacturing screws from it there is a waste in weight of about 40 per cent. The duty on this raw material (wire rods in coils) is $28 tier ton (1J cents per pound), and this, with the usual ship ping expenses added, is equivalent to an advance of from 75 to 80 per cent, (varying according to charges in the price of rods) on the cost to the foreign manufacturers of wood screws, with whom we have to compete. (See calculations annexed.) While this material for the screw-makers’ consumption has a protec- tion as stated, viz, from 75 to 80 per cent., the protection on screws made from it under existing tariff, as shown by custom-house returns, ranges from 40 to 50 per cent. On account of the large waste resulting from forming the heads and threads of wood screws, somewhat more than 2 cents per pound of the protection under present tariff is offset by the duty paid on raw material. Under a threatened removal or reduction of the duties on screws, we felt compelled to transfer a considerable portion of our machinery to Dundas, Ontario, where we have a supply of nearly free raw material, and have prepared to manufacture for the American market, in event of a reduction in duties on screws, unaccompanied by a corresponding reduction on wire rods. Some few wire rods rolled in the United States are used for making screws, but they are largely manufactured from foreign wrought iron, imported scrap, paying a duty of $8 per ton, and in its conversion into rods there is a considerable waste. Screws are also, to a small extent, made from Bessemer steel, but the nature of this material is such that we have never succeeded in using it with advantage, although we can buy it at much less price than iron, and this experience has been confirmed by the foreign screw man- WOOD SCREWS. BDWLN G. ANGELL.] 727 ufacturers. There is now double the quantity of screw machinery in the United States than can be successfully employed. The following table shows the cost of iron-wire rods in coils to the American manufacturers of wood screws : ENGLISH RODS. One ton rods (invoice price) £8 10s, at $4.85 currency, cost to English manu- facturers $41 23 Expenses to American consumers : £ s. d. Shipping charges 2 6 Commission, 2f per cent, on £8 10s 4 3 Freight 15 0 1 1 9 at $4.85.. $5 27 Duties, If cents per pound, 2,240 pounds 28 00 33 27 Cost to American manufacturers 74 50 Expense 80.7 per cent, advance on English cost. GERMAN RODS. Cost to German manufacturers $41 87 Expenses to American consumers: Freight, Rotterdam to New York $3 25 Duties 28 00 Shipping charges 85 32 10 Cost to American manufacturers in New York, per ton 73 97 Expenses 76.7 per cent, advance on German cost. In former years we used very largely a rod made from scrap iron for screw cutting, but the scrap has deteriorated in quality so that we cannot possibly use it. There are no puddle rods made in this country although the attempt has been made to manufacture them several times. Mr. A. S. Hewitt has tried it several times at his factories, and the peo- ple in East Boston have tried it, but not successfully. Therefore we have been obliged to get them from England and Germany more and more, until at present we import substantially all our material. For- merly we used the scrap, but this was so poor that we had to give up the attempt. I gave an order for 1,200 tons yesterday in Germany. Our consumption is large. There is a rod made by Mr. Hewitt of scrap sunk in a charcoal fire, but it is too high priced for ordinary use. We import our goods largely from Sweden. The only iron we buy in this country, and that is in small quantities, is this charcoal scrap iron. We get that in Pennsylvania and pay a very high price for it. The Penn- sylvania iron is of the best quality we know, but the price is two and a half times what we pay in Germany, and there is only a very limited product at that. By Commissioner Garland : Question. Have you a plant in Canada? — Answer. Yes, sir. Q. When was that established? — A. In 1875, 1 believe. We then had iron, duty free. There was a duty imposed of 5 per cent., but we were relieved of that by order of council, and I think we shall have that same favor extended to us again after a while. The present duty is 10 per cent. They gave us the highest duty on screws that they put on 728 TARIFF COMMISSION. [EDWIN G. ANGELL. any advanced manufacture, but the market is a very limited one, and we should not have gone there for that alone. By the President : Q. Your industry was formerly protected by patents, was it not? — A. Down to the year 1850 we had a pretty hard time of it. There have been, since 1815, 80 different enterprises started for the manufacture of screws, and I venture to say there are not five to-day who can get their capital back. There are 14 of us at work to-day; but I will guarantee to supply the wants of the market with our own mills. In 1849 the gimlet pointed screw was reintroduced. It was not a new article as is generally supposed; it was an old European product revived. The first machinery used in this country for making screws was only adapted to making the blunt point with dies. Abroad they were made with a chisel on the old French hand machine. That was made an automatic machine, and in 1849 the gimlet-point screw was brought forward. Meanwhile there had been so little success in screw making that there were but three companies left and they reaped the harvest. In I860 the three or four remaining companies consolidated and formed the present American Screw Company. For five years we had the benefit of patents on our automatic machinery, but since that time we have had no patents to protect us. Q. The patents have expired, have they ? — A. Yes, sir; they expired in 1864. But following the war we had this period of prosperity, and made a good deal of money. There is some misapprehension in regard to the profit made in our business, from the fact that we pay our divi- dends on a nominal capital, and our reserve was twice what our capital was. Our present capital represents nearly all we have in the business. H. HOWARD. ] JEWELRY. 729 H. HOWARD. Boston, Mass., August 26, 1882. Mr. H. Howard, of the firm of Howard & Scherrieble, of Providence, R. I., manufacturers of sleeve and collar buttons, addressed the Com- mission as follows : I am not asking for an increase of duty on the articles we manufact- ure. Our principal desire is to extend our foreign trade, or rather to get some foreign trade ; aud 1 think that is more important to us than increasing the duty on our productions. The duty on jewelry is 25 per cent., and on precious stones, so called, 10 per cent. Diamonds also pay the same rate of 10 per cent. The reason for placing the duty on diamonds so low was because of the facility with which they might be smuggled through in case the duty was too high. The articles we use in addi- tion to gold, silver, and brass are precious stones, which only pay a duty of 10 per cent., while jewelry itself pays a duty of 25 per cent. I do not think the jewelers of the United States have complained because the duty was no higher than it is. As an illustration of the fact that they have gotten along very well with the duty at the present rate, I might refer to the American watch industry, which has been built up to enormous proportions — the proprietors having made themselves mill- ionaires, and the business having attained such proportions that the importation of Swiss watches has almost entirely ceased. I can speak personally and feelingly on that subject, because I was one of the im- porters who was driven out of the business in that way. I was engaged in the business five years, and lost money in it, and left it for the man- ufacturing business. The American Watch Company, the Elgin Watch Company, and kin- dred companies have almost entirely monopolized the business in this country on a duty of 25 per cent. They have been protected that much and no more. What we desire is a foreign trade, so that we can keep our factory running the entire year. At present we have only eight months’ business. The average wages while the men are at work are about $12 a week for adults, although our last pay-roll showed an aver- age rate of from $8 to $9 per week per head. But there were a consid- erable number of boys and girls on the roll, so that the average may be smaller. The average of adult jewelers now get only about $2 a day. It is an art that should be paid well for. A man is required to be a better artisan to make jewelry and articles of that description than where he has only to work upon iron or any other of the heavier metals. By the President : Question. Are you a manufacturer of jewelry ; that is to say, have you a factory ? — Answer. Yes, sir. We have a factory and employ 84 hands. I have here a letter, received from our agent in South America, in which he says: “Inclosed we hand you a letter received by the way of Eng- land.” I do not know of any better text to illustrate my subject than that; the idea that we have to do our business in South America by the way of England is enough to stop our export trade. Jewelry is a non-es- sential, and by itself it cannot penetrate foreign countries ; we can only follow in the wake of the heavier and more necessary materials. When we can export large quantities of cotton cloth, hardware, &c., then we can 730 TARIFF COMMISSION. [H. HOWARD. hope to export some jewelry. But until that time arrives we cannot hope to extend our business to foreign countries, and until we do that we cannot keep our men at work the entire year; consequently, it reduces our men’s wages to about 89 a week, taking the whole year round; whereas, if we could give them work the entire year, we could pay them eonsiderably more. The highest wages we pay now is about $3 a day, .and the lowest about 83 per week. There are too many persons engaged in this manufacture at present to afford any great profit, unless we can have a foreign market to export our goods to; and I see no chance for a foreign market unless we can so extend our commercial facilties as to have direct steamship lines between this country and the ports we want to reach. As I have said, our foreign representative in South America has to send his letters to us by the way of England. In general, I would say that the manufacturers of jewelry are doing reasonably well, and are not asking for any increase of duty; in fact, when duties on other goods are reduced to the rate paid on jewelry, namely, 25 per cent., we shall be satisfied to take 5 cents lower duty than we have now. We would rather have some of these high duties on woolen goods reduced to our own standard than to have our duties increased. I do not think it would help us at all to have our duties in- oreased ; on the contrary, I think it would defeat what we are looking after — the creation of a foreign market, so that we can dispose of our surplus productions. If we could sell one-quarter of our production to foreign countries, and not be confined simply to this country for our market, we could employ at least 100 hands during the whole year. We commenced the business employing 85 hands. We reduced the number to 60, and so on, till last year we only employed 30 hands ; we eould find no employment for the rest of them. The result is, a large number of hands every year are unemployed, and at least a quarter of the time nearly all of them are out of work ; and we see no way to im- prove this condition of things but by obtaining foreign trade ; and we see no way of obtaining foreign trade unless our ports are open to buy and sell more freely than is the case now, which would give us a chance to exchange our commodities. The old Yankee privilege of swapping is denied to us. We think it is unfair. We could keep our men at work and pay them better wages under a different state of affiars. Wages have increased very little, while the cost of living has increased very much. I have a memorandum here which was handed to me by a gentleman this morning, which shows the following advance in prices : Cost of living. Articles. 1856. 1882. Flour Steak Potatoes . . . Butter Sugar Rent $5 00 to $6 00 .... 12 to 18 ! 50 to 75 .... 15 to 17 . . . . 6 to 8 .... 1200 $9 00 to $9 50 30 to 35 1 25 to 1 40 35 to 60 10 to 11 20 00 Wages have not increased anything like that. A man in 1856 could support his family better on 8600 a year than he can now on $1,200 a year; and I think the additional expense is caused by the immense pro- tective tariff which we have in this country. Q. Yon have a factory giving employment to 84 persons! — A. Yes, JEWELRY. H. HOWARD. ] 731 sir; we do not employ 84 bands except during the busy season, lasting about eight months in the year. Q. Where are your goods sold? — A. In this market almost entirely. We have made an effort for a foreign market, but have not succeeded yet in exporting. Q. What class of jewelry do you make? — A. Sleeve and collar but- tons almost exclusively. Q. Is your market increasing in this country? — A. I presume our market is increasing ; I have no doubt about that. Q. You say the article you manufacture is a superfluity? — A. Yes, sir $ it is a superfluity and not a necessity. People would not buy sleeve buttons if they wanted bread or clothes. Q. What are the average prices received for your goods ? — A. They run very low — from $4.50 a dozen pair up to $15 a dozen pair, or say from 37£ cents to $1.25 per pair. Q. What class of people are your customers ?< — A. The middle and working classes principally. 732 TARIFF COMMISSION. [AAEON WILLIAMS, AARON WILLIAMS. Rochester, N. Y., August 29, 1882. The following communication from Rev. Aaron Williams, in regard to the duty upon foreign Bibles, was read and ordered to be printed : To the members of the Tariff Commission : Gentlemen : Some time ago a petition signed by many of the clergy, merchants, bankers, and other citizens in this city and State, praying for the abrogation of the duty of 25 per cent, ad valorem, now charged on all foreign Bibles, was presented to the honorable Senate and House of Representatives in Congress assembled. Being informed that the said petition is now before the Tariff Com- mission, appointed by the President of the United States, we hereby take the liberty to express an earnest hope, that after due consideration of the said petition, the Commissioners will heartily recommend Con- gress to admit into the United States the Bible, and any and every part thereof, and in every form and language whatsoever, free from duty. This great boon will certainly promote the sale of the Bible ; the dis- tribution of the Bible; the study of the Bible; and the influence of the Bible ; and thus, contributing to the social, the commercial, and the moral welfare of the people of this great land and republic. All who have signed the petition, together with many more who have not had the opportunity of doing so, will rejoice to know that the Tariff Commission have used their great influence toward securing the privi- lege sought. This petition has been the subject of favorable discussion at the meet- ings of the denominational clergy of this city ; and it has received the recognition of the local press. Other papers also have taken up the question, and thus the public have become well acquainted with its merits. With confidence, we assure the Tariff Commission that the idea of a free Bible has met with almost universal approbation in every mind to whom the question is presented. On behalf of the petitioners, Aaron Williams, Secretary. San Francisco, Cal., August 21, 1882. The following is a copy of the petition referred to : To the honorable Senate and House of Representatives in Congress assembled: The undersigned petitioners, citizens of the State of California, beg leave to show That the present revenue laws impose a duty of 25 per cent., ad valorem, on the im portation of the Bible into the United States. That the Bible is printed and bound and sold in other countries at a price from 50 to 75 per cent, cheaper than in the United States. That in common with the great majority of the citizens of our republic, your petit- ioners believe that the social, commercial, and moral welfare of our people will been- chanced by the cheap distribution of the Bible among all classes. That no citizen can desire, or ought to have, the protection of the government for pecuniary profit by the manufacture or sale of the Bible. That the Government of the United States cannot desire to realize a revenue from the importation, or distribution, or sale of the Bible. Wherefore, your petitioners pray that the revenue laws of the United States may be amended, so that the Bible, and any and every part thereof, and in whatever form and language, may be admitted free from duty. PATRICK BARRY.] PLANTS. 733 PATRICK BARRY. Rochester, N. Y., August 29, 1882. Mr. Patrick Barry, of tlie firm of Ellwanger & Barry, of Rochester, addressed the Commission as follows : My statement will occupy but a very short time. I inteuded when I heard that the Commission would visit Rochester to invite several of the leading nurserymen of the country to meet here and agree upon a statement to be submitted to the Commission; but the time at my dis- posal was so short that I found it impossible to do so. Therefore my present statement is an individual one, and embodies merely my own views. We respectfully recommend that all duties on living trees and plants imported from foreign countries be abolished, for the following and other reasons : 1st. The value of such importations is so small that no considerable revenue is derived from it. What little there is must be mostly con- sumed by the expense of collecting. 2d. American nurserymen need no protection. They have nothing to fear from foreign competition. They can grow almost all sorts of trees and plants in demand in this country cheaper and better than they can be grown in any part of Europe. The prices of fruit trees and a great many ornamental trees and plants are at this time, and have been for many years, lower in American than in European catalogues. There are certain articles that can be grown in Europe better and cheaper than in this country, and it would be advantageous to Ameri- can nurserymen and to the American planter to have them imported free of duty. The amount of the duty is not a very great burden, but the delay which its collection causes frequently results in the death of the plants, and the importer pays duty and expenses on worthless prop- erty and suffers serious disappointment besides. The great objection to the working of the present system is the delay and expense in getting goods through the custom-house on these small matters. I have here a memorandum of our importations of last spring. They were very small, much smaller than they have been in twenty years. We import articles from Belgium, France, England, and Scot- land. Altogether there were eight different importations, all small in amount. The total amount was $2,748, on which the duty, at 20 per cent., amounted to $545.60. There were other custom-house expenses amounting to $67.50, making a total of custom-house expenses on this $2,748 of $613.10. These articles were nearly all new varieties of plants. There are certain kinds of plants and trees originated abroad which we import into this country to be propagated and then sold by the nurserymen. There are also some articles, such as seedling trees, which grow better in the climate of England, France, than they do here. These are the only articles imported by nurserymen. They amount to very little in value, and the country would be benefited to have them brought in free. But our great objection has been the delay that is caused in the custom-house on articles that should be shipped right through and reach here in a short time. 784 TARIFF COMMISSION. [PATRICK BARRY, By Commissioner McMahon : Question. Does this item of $67.50, to which yon have referred, in- clude the custom brokerage? — Answer. Yes, sir. Q. That is not properly a custom-house expense ; the broker is your agent. The brokerage would be the same on other things. — A. The most of the items I have referred to are caused by the collection of the custom-house duties. Q. I mean it costs just as much for passing an entry in the custom- house, whether there is a duty on the goods passed or not. If that item includes brokerage it is not a necessary part of custom-house expenses- — A. I can tell you just what it includes. [Reading.] “ Custom-house fees, bond, owner’s oath, and brokerage;” these are the items. Q. What is the total amount of the charge for brokerage ? — A. The brokerage is $4 ; the custom-house fees were $1.40. Q. That $4 was paid to your custom-house broker and not to the cus- tom-house. You say that if these goods could be shipped right through it would save delay? — A. Yes, sir. Q. Is there any reason why they cannot be shipped right through under the immediate transportation act ; have you ever had any goods arrive here in that way ? — A. No, sir ; I tried to get them here in that way but could not succeed. We understood that this was a port of entry and the duties could be paid here ; but the goods were not forwarded and could not be. The only time when we tried to have our goods come direct to Rochester was when they were sent to the store-house in New York and kept for about a month. Q. Do you know the reason why they were kept there so long ? — A. No, sir, 1 could not tell you the reason for it. Q. Was it not owing to your failure to have the proper papers? — A. No, sir; we had all our papers and everything, the consul’s certificate and all, attached. Q. Did this occur at the New York custom-house? — A. Yes, sir. We have been importing goods for forty years and we know what is required to be done-in order to secure the passage of goods quickly. Q. Do not some of the merchants of Rochester import goods directly to this city and pay their duties here ? — A. I do not know ; I think they do, but they are duties on goods not so perishable and it does not mat- ter whether they lie over a week or two in New York or not, and they make no particular complaint about it, I suppose, if they do. But trees and plants are perishable, and we have tried in every way in our power to get our goods sent through without detention, but we find that to be utterly impossible. Q. Do you think if they were put on the free list that would help the matter ? — A. Yes, sir ; we think so, because the custom-house officials have always claimed that the assessment of the duties was the cause of delay. Q. That is to say, the brokers have always urged that as the cause? — A. Yes, sir ; and we think it is true, because they are honorable men, discharging their duties to their clients, and it is to their interest to facilitate matters. Commissioner McMahon. It takes just as long to pass an entry of free goods through the custom-house as of dutiable goods, especially where it is a simple duty of twenty per cent. It does not take much longer to write down the word “ free ’’ than it does to write down the words “20 per centum.’’ I do not see where there would be any ad- vantage in that respect. All the goods have to be examined and in PATRICK RA1UIY.] PLANTS. 735 spected just the same, to see whether they are free goods or not, or whether they are subject t© a rate of duty. The Witness. If we could get our goods through the custom-house rapidly we should not care about the amount of duty so much. Commissioner McMahon. But I do not understand why the question whether they are free or dutiable goods should affect the matter of rapid transmission through the custom-house. By Commissioner Underwood : Q. What would be the effect on the consumer — the purchaser — if the duty was taken off these goods ? — A. I do not think it would affect the price of the article to any extent. If their importation could be facili- tated it perhaps might make a difference. In that way the price might be reduced. Q. What is the total amount of dutiable plants and trees imported annually into the several parts of the United States ? — A. I could not say. I do not think the amount is very large. Our own imports some years have amounted to $5,000 or $10,000, but this last year or two they have been very light. I do not suppose the importation of trees and plants into this country would amount altogether to a million dollars, or perhaps not half of that sum. Q. If it amounted to a million of dollars the duty would be $200,000, and to make them free would be to take from the government just that amount of revenue l — A. The government does not get all the duty. It costs a great deal of it to collect it, does it not ? Commissioner Underwood. No, not very much of it. By the President : Q. Is there not a class of plants grown abroad which are not grown so largely in this country ; Dutch bulbs, for instance? — A. Yes, sir; but they do not come under the head of green plants ; they come under the head of seeds. The seedmen will probably speak in their own in- terest before the commission. Q. Take what are called the American plants, the rhododendrons, &c. ; are they not imported largely from abroad % — A. Yes, sir ; they are imported somewhat, but not extensively. There may be a few gen- tlemen living in New York, Philadelphia, and Boston who import a few, but the nurserymen do not import many. Mr. Parsons, a nurseryman of Long Island, grows and propagates these rhododendrons. I have received a letter from him saying that he hopes the tariff law will be amended imposing a duty of 50 per cent., instead of 20 per cent., on the foreign article. That is simply because he grows a class of plants which are imported in competition with him. But I think the nurserymen of the country generally would be in favor of having trees and plants admitted free, especially if it would result in getting rid of these vexa- tious delays at the custom-house. One of your commissioners has said that the delays are not caused by the assessment of the duty. I have always had the impression that was the cause of it, but I may be mis- taken. Commissioner McMahon. I gave you a reason for my statement. I say it does not take any longer to compute a 20 per cent, duty than it does to write the word u free” on the invoice, and that is the only differ- ence between the two. The operation of the law is precisely the same. And more than that, at all custom-houses, by order of the Treasury 736 TARIFF COMMISSION. [PATRICK BARRY. Department, perishable goods have the preference over other goods in passing. The Witness. I am glad to know that is so, but it does not accord at all with our experience. Whenever we have written to the custom-house officials about it the answer has always been that they knew of no such order ; that one man’s goods were the same as another’s to them. I think perishable goods ought to have precedence. T. L HENLY.J FLAX. 737 T. L. HENLY. Rochester, N. Y., August 29, 1882. The following paper, received from Mr. T. L. Henly, of the French- town (N. J.) Flax Works, was read and ordered to be printed: In reply to Messrs. Finlaysou, Bonsfield & Co.’s statements in regard to the admission of flax fiber into this country free of duty, we desire to state a few facts. The statement has been made: 1st. “That flax is not grown in America to any extent ior textile manufacturing purposes.” Answer. To admit foreign flax, duty free, would preclude its being grown at all in those parts of the country where the fiber really is good enough for textile manufacturing purposes. In this portion of New Jersey flax fiber sells at an average of 10 cents per pound. It costs about 8J cents to prepare it for market, so that the profit is not large ; but it pays the farmer better than any other crop, whether he sells his straw to the manufacturer or works it up himself, and the money value thereof is thus kept in the country, in place of enriching other nations at our cost. 2d. “ That linen manufacturing does not receive encouragement by having the raw material grown at home, and would therefore not de- velop, but cease to exist unless supplied from abroad.” Answer. How can this be if plenty of material were forthcoming in this country ? If the flax industry is properly encouraged it will event- ually rival the cotton trade in magnitude and importance, for there is a far wider area in this country suitable for flax than there is for cotton, and linen goods, if cheap enough, will always take the lead for general purposes. 3rd. “That, the development of manufacturing is the only means of encouraging the production of superior flax.” Answer. True, by the foreigner ; but why kill a trade we can build up at home, in the production of flax fiber of medium quality, to insure this? 4th. “That the manufacturing of linen can best be encouraged by the introduction of raw material free of duty.” Answer. True. But the manufacturing of flax fiber will be injured in proportion. 5th. “That a handsome profit could be realized by proper treatment out of straw now destroyed.” Answer. Not so, if converted into fiber for textile manufacturing pur- poses. With a bounty, such as this State confers, it will pay ; but with- out this, flax straw, as produced out West, is only fit, when converted, for stuffing chairs and sofas. 6th. “That the quality of flax fiber is so dependent on favorable conditions of soil, water, and climate, that it is questionable if any one country can produce the entire range of qualities necessary for the manu- facture of linen threads and fine linen.” Answer. True; but why kill a trade that can be done, because it can- not do impossibilities ? 8th. “ That under the most favorable circumstances it must take many years before the best results could be obtained, and that linen manu- facturers must have quality at any cost.” H. Mis. G 17 738 TARIFF COMMISSION. {T. l. hexly. Answer. True. But this is no argument, to my thinking, why foreign flax produced by cheap labor should be admitted duty free to the cer- tain ruin of a very important industry in this country. The manufact- urer of linen can well afford to pay a duty on the finest descriptions of flax, and the higher value of such would stimulate the production of it over here, which is by no means an impossibility, but depends in a very great measure, although not entirely, upon the extra care and labor be- stowed upon it. America will eventually export flax largely if due en- couragement be given to the grower, beside supplying her home manu- facturers with nearly all they may require. HIRA1I SIBLEY. 1 SEEDS. 739 HIRAM SIBLEY. Rochester, N. Y., August 29, 1882. Mr. Hiram Sibley, of Rochester, nurseryman, addressed the Com- mission as follows : Gentlemen of the Tariff Commission : As a certain firm of seedsmen have addressed you, advocating an increase to 100 per cent, of the duty on imported seeds, we beg leave to submit : First. That there are probably less than one hundred persons who make a business of growing seeds in the United States, and that the wages of the one or two thousand employes of the seed-growers and seed -dealers are in no way influenced by either a high or low tariif on imported seeds, as they are not grown to any considerable extent in America. Second. The assertion that seeds in Europe are grown by pauper la- bor is a mistake, as the most skilled farm workmen of Europe are em- ployed by the seed-growers, and the work is done as a rule more care- fully and better than in this country. The assertion that the home industry is “ capable of supplying in a superior form all the wants of the country, with the exception of a few unimportant articles,” is incor- rect. Climate has an important influence on the development of seeds, and many kinds cannot be grown to perfection in this country ; further, it is almost impossible to get farmers to grow seeds, even of the varie- ties which may be grown to perfection in the varied climate of the States. All vegetable seeds, with the exception of beet, carrot, lettuce, onion, parsnip, and turnip, are grown in greater perfection in Europe, and hence more for the interests of American farmers ; and the same is true of all flower seeds. Third. The assertion that the climate of Europe is more favorable to the production of seed is true; but from the above statement of facts this is evidently an argument against, rather than for, a high tariff, as it is in the interests of American farmers and not prejudicial to Ameri- can seed-growers. Fourth. The assertion that American grown seeds, by reason of their acclimation, are better adapted to American needs and are preferred by American cultivators, is a mistake, except in case of the varieties above mentioned. Therefore we advocate, in the interests of American farmers and seed- dealers, the abolition of import duties on all flower seeds and all vege- table seeds except beet, carrot, lettuce, onion, parsnip, and turnip, upon which there is no objection to a low tariff of 10 to 20 per cent. We assert that it is not right to impose a high tax upon seven million seed users for the benefit of one hundred seed-growers. The policy of a tariff upon imported seeds seems at war with the policy of the government, which now distributes seeds of food crops freely among growers. Again, the present discrimination against cer- tain grains for seed in favor of grains for food is unjust; if any dif- ference is made it should be in favor of the seed, according to the present policy of the government, which admits live-stock for breeding purposes duty free. I am ready now to answer any questions that the members of the 740 TARIFF COMMISSION. [Hill AM b I BLEY. Commission may desire to ask in explanation of these matters. I am a very large farmer, and may possibly say something of the farming interest generally, but I do not propose to detain you with a set speech. Of course, this matter of agricultural productions involves very large interests and is somewhat complicated. By the President : Question. If there are any points which require further elucidation you are liberty to state them. — Answer. We make a point in regard to the general policy which the government has seen fit to adopt in the free distribution of valuable seeds. The government is spending a large amount of money in this way. The duty imposed upon seeds is very much larger where the seed is valuable and imported for propagation than where it is used for consumption. It seems very strange that while the government is spending so much money trying to introduce valuable seeds in this country it should turn around and assess twice the duty on the same article used for seed that it assesses on it when used for con- sumption. For instance, the English have developed very valuable varieties of pease. The duty on pease is 20 per cent, when used for seed, but when used for consumption it is only 10 per cent. And a conflict is all the time arising between the government and the importer as to whether seeds are to be used as seeds or for consumption. We import seeds for both purposes. We import a valuable seed, and when we find it is not worth as much as we expected, then we sell it for consumption. We have imported seeds and paid a duty of 20 per cent, upon them, and have afterwards sold them for consumption. The government in carry- ing out this policy has provided that the seeds distributed by the De- partment of Agriculture shall be sent free through the post-office. The government buys seeds from us, puts them in packages, and sends them free through the post-office. But when we want to send seeds through the post-office we are forced to send them to Canada, pay a 10 or 20 per cent, duty to get them in there, and then put them into their post-office to send them 50 miles from here. The seedsmen of this town now send through the mail valuable seeds to their customers 50 miles from here, and they can send them with profit to Canada, pay the duty of 20 per cent., pay the postage in Canada, and get them sent to their customers 50 miles from here cheaper than they can mail them here. That may be a subject for you to examine in connection with the transmission of goods through the mails. I mention it as one of the absurdities growing out of the tariff question. Certainly it is within your province, and, I sup- pose, consistent with your wishes, to make the policy of the government harmonize on these questions. The government is a large customer of ours and buys large quantities of seeds from us on which we have to pay a heavy duty, and then they distribute those seeds free through the post-office to people all over the United States. Q. About what quantity of land do you devote to the growing of seeds for propagation % — A. I have over 3,000 acres devoted to that business. I grow more seeds probably than anybody else in the country. My land is mainly and largely devoted to the growing of field seeds, grasses, and pease. My farms are located in Illinois, Michigan, and New York. By Commissioner Garland : Q. You advocate that all grains and seeds be put upon the free list! — A. Yes, sir; I would not say that seeds of all kinds should be placed on the free list. We have excepted certain seeds that are not grown by the American farmer. We see no special object in taxing the consumer, HIRAM SIBLEY.] SEEDS. 741 unless that tax is to operate favorably upon the American grower. The tax on such seeds as will not grow with profit here had better be abolished in the interest of the consumer. Q. You grow pease extensively? — A. Yes, sir 5 very largely. By Commissioner Boteler : Q. You do not object to the policy which the government has adopted of distributing gratuitously these seeds, do you? — A. Yo, sir; I think that it is of the first importance to the farmer that he should have good seed, and that it is for the interest of the government ai$o. But it seems to me that the present tariff on seeds is at war with that policy which the government has adopted in the distribution of seeds. 742 TARIFF COMMISSION. |H. C. ROBERTS. H. 0. ROBERTS. Rochester, N. Y., August 29, 1882. The following communication from Mr. H. 0. Roberts, president of the Charlotte Iron Works, was read and ordered to be printed: To the members of the Tariff Commission : We desire to call your especial attention to the duty on foreign iron ore, which is 20 per cent, ad valorem. Should it not be placed on the free list ? 1st. It is raw material in the most crude form. The government, to protect our forests, has placed telegraph poles, railroad ties, and saw- logs on the free list, all of which can be reproduced, but iron ore cannot be reproduced, and is an irreparable loss to any country exporting it. 2d. Our native ores are very lean, averaging only about 38 per cent., and largely impregnated with phosphorous, and when used alone, make a rather cold short iron, unfit for foundry use. To remedy this we are obliged to use a mixture of better grade ores. 3d. Lake Superior ore being so far distant, the cost of transportation prohibits its use, and Champlain ore, as a rule, contains too much phos- phorous. 4th. Canada ore fully answers our purpose, being perfectly free from sulphur and phosphorous ; but the duty prevents the use of it, except in small quantities. 5th. At present the Bessemer rail mills in Eastern Pennsylvania and New York are importing Bessemer pig. If this ore was on the free list we could compete successfully for this trade. 6th. The ore cast in a ton of consumable iron, worth averaging $50 per ton, is only from $8 to $10, the balance of cost being mostly labor. Therefore, would it not be for the general welfare to let the raw material in free ? Very respectfully, H. C. Roberts, President . L. STRAUS &. 80N8.] POTTERY AND GLASSWARE. 743 L. STRAUS & SONS. Buffalo, N. Y., August , 30, 1882. The following communication from Messrs. L. Straus & Sons, of New York City, importers of china, pottery, and glassware, was read and ordered to be printed : To the honorable Tariff Commission : Gentlemen: In compliance with your circular dated Washington, July 11, 1882, we herewith beg to return to you the blank which you forwarded to us, duly filled out as requested. A committee, represent- ing our line of business having arranged to appear before you, we desire to submit, in addition to their statements, the following points: One of the main objects we had in view in our suggestions as to a change in the present tariff of goods in our line was to have an uniform one, in so far as to remove all possible conflict of opinion as to whether the goods come in under one rate of duty or under another. These questions frequently arise, and have been erroneously decided by the examiners here in compelling the payment of duty on an article as china which the trade was convinced was not china, as well as other similar unpleasantnesses, which can be avoided by a uniform tariff. In addition to this reduction in the rates of duty, as we suggest, we would ask the entire abrogation of duty on packing expenses, inland freights, commissions, &c., which on these lines aggregate particularly onerous. Take, for instance, the lower grades of white and printed earth- enware, majolica and Bohemian glassware, which nominally pay a duty of 40 per cent. ; the actual duty on the goods themselves is in reality from 70 to 80 per cent. On many articles the present duties are in fact pro- hibitive, and, unless reduced, might as well be 100 as 35 to 40 per cent., if it be not the object to have a prohibitive tariff. By a simple study of statistical figures as to the amount of earthenware that is being import- ed, whether in number of packages or in value, compared with what was imported 10 years ago, an erroneous conclusion is arrived at. Then fully 95 per cent, of all importations of earthenware consisted of plain or white ware, but since then home manufacturers grew up to produce the goods for less than they possibly could be imported at, and importers, finding a large portion of their business gradually slipping away, natur- ally sought another channel to make good this loss. This has, in a great measure, been the means of the introduction into this country of colored earthenware, known as printed ware and majolica, and if it were not for this change in the character of the business and the importations being confined to the same class of goods as were im ported 10 years ago, the importations of earthenware from Great Britain, which, in round numbers, were something over 100,000 packages then, and are about the same now, would probably not reach 50,000 packages, or less than half, with a corresponding decline in value; the falling off being attributable entirely to that class of goods which are manufactured in this country at less price than they could possibly be imported for. To those who are familiar with the trade and come in contact with American manufacturers, it must be apparent how profitable American potting must be under the present protection when it is observed that in many cases the money was supplied at the start by capitalists, who 744 TARIFF COMMISSION. [L. STEAUS & SONS. only had in view the aim of making good returns on their investment and placed it in the hands of practical potters, who, in most instances, have, through the enormous profits, been enabled to pay off and buy out the original capitalists, and are capitalists themselves to-day. The absence of statistical figures prevents our placing these facts in a tabu- lated form ; but they are facts which are patent to every one who comes in contact with the manufacturers in question. If there are any exceptions to this rule, the exceptions are certainly as few as they are under any general rule. In fact, there is no class of business men or manufacturers where so large a percentage of those engaged have been successful and so small a percentage have been un- successful. If properly investigated it will become apparent that those of the latter category either did not give their entire attention to the business or they were not experienced potters, but were led to launch therein from the lucrative returns they so amassed. Every experienced potter who associated himself with a man who un- derstood the routine and the rules of business, a man possessed of only the ordinary sagacity required of a business man, has been successful; and it seems preposterous for an industry which has been built up and wliich has thrown off such large profits under the present tariff, where i t had to encounter the difficulties and the intricacies of a new under- taking and to grapple with the mysterious freaks of nature in the mix- ing of chemicals and clays, should now, after all these obstacles have been surmounted and reduced to a science, come forward for additional protection, where, if we understood it aright, the creation of your hon- orable commission was prompted by the aim to investigate what reduc- tions are in order, because the tariff worked injuriously and was a war tariff, and hence oppressive in many respects. Very respectfully, L. Straus & Sons. New York, August 26, 1882. Present tariff designation or commercial name of article. Earthenware China, white China, decorated Glassware, plain and pressed Glassware, cut, colored, and decorated Parian statuary Bisque and chiua statuary © c3 * £ s a> 3 o' 3 © © © o® £ £ Per cent. Per cent. 40 30 45 30 50 30 35 25 40 25 45 10 50 10 W. N. J0NE8.] SUMAC. 745 W. N. JONES. Buffalo, N. Y., August 30, 1882. The following communication from Mr. W. N. Jones, of Petersburg, Va., secretary of the Sumac Manufacturers’ Association of Virginia, was read and ordered to be printed : The Honorable Tariff Commission : In behalf of the Sumac Manufacturers’ Association of Virginia, I beg to respectfully submit herewith, for the consideration of your honora- ble Commission : 1st. A petition recently made to Congress by said association, asking an increased duty on 11 Sicily sumac, and its extract,” and on u tanned .sheep and goat skins ” 2d. Some statistics and other information, which I have been enabled hurriedly to get together. We trust it will be the pleasure of the Commission to carefully con- sider this subject, and recommend sugh relief as they, in their wisdom, may devise. We would prefer a specific tax on imported sumac of twenty -dollars per ton, in lieu of an ad valorem tariff. In the matter of u East India tanned goat and sheep skins,” we beg to second the movement that the Morocco Manufacturers’ Association have already made in that matter beiore your Commission. If it should be the pleasure of your Commission to hear further argu- ment in this connection, our association will appoint a delegate to ap- pear before your honorable body. Very respectfully, W. N. Jones, Secretary Sumac Manufacturers ’ Association. Petersburg, Va., August 28, 1882. To the Honorable Committees of Finance of the Senate and House of Representatives of the United States: We. the sumac grinders of America — which are mostly confined to Virginia — do most respectfully call your attention to the following prin- ciples, in the regulation of our tariff, which, in general, we think are true, and as to our particular business we A mow to be facts: The grinding of sumac in this country was induced by the war. The war so increased our currency (greenbacks) as to act as a heavy duty on foreign sumac. Of course the foreign article had to be sold for gold value, which caused it to bring a large price in greenbacks, thus giving home industry a chance. The energy and enterprise of our people availed themselves of this opportunity ; and just here let us say, that the idea of monopoly is a mere fallacious one, for no one party can monopolize a business in this coun- try, with all its capital and enterprise. On the other hand, by en- couraging home manufactures, prices have been materially decreased by competition among ourselves. We think this is a statistical fact in regard to iron; and more recently, the silk manufacturers of this country have greatly reduced the price of a good article, under a very heavy duty, which they could not have done had there not been, from the necessities of the war, a heavy duty placed upon silk, which justified 746 TARIFF COMMISSION. [W. N. JONES* the investing of the capital necessary for the u plant”; also the want of experience, which has to be paid for as readily as the very “ plant’ 7 itself. Now, in regard to the business of sumac grinding. The imported ar- ticle was worth more before and daring the war than it has been since* because the country was depending entirely upon the foreign article ; they could ask us what they pleased, and we had no alternative but to pay ifc. Now, while their article in some respects is better than ours — because they can afford by their cheap labor to cultivate it and give more attention to the manipulation of it, &c. — we have been able by su- perior skill and industry to produce an article that will in a great degree substitute it for nearly half its cost, while we have to pay from three to four times as much for labor. Seeing this, the foreign article has been gradually reduced in price* until it has become almost impossible for us to maintain our trade: and we ask a x^rotective tariff on foreign sumac and tanned sheex) and goat skins for the good, we think all must admit, of the whole country, insomuch that labor is honorable and should be well paid in this country of free and equal rights to all, and not brought into competition with the oppressed and x^auper labor of Europe, and recently, more par- ticularly, with that of China and East India generally, to wit : Whereas sheep and goat skinsb are admitted into this country with twenty per cent, less duty without the wool on them — has induced the practice of foreign tannage in the rough, which greatly curtails the con- sumption of our sumac, as they are only finished up here, this, with other causes stated, has reduced the value of our goods in the market fully fifty x>er cent. Therefore we most respectfully ask that a greater duty be levied upon tanned skins — goat as well as sheep — for English caxu- talists are really tanning goat skins in British India by clieax) cooly labor, and sending them here to comx>ete with our well-paid labor. Labor is the foundation of'all wealth, and should be honored and pro- tected. All we ask is singly to equalize labor, and that in part only, for we can accomplish more than any other people, under similar cir- . cumstances, but cannot afford to x>ay $1 a day lor labor which can be obtained in China for at most 10 cents, and compete with foreign goods. Furthermore, we ask an increased duty on sumac and extract of sumac imported into this country, for the reason above given — mainly the differ- ence in labor between Southern Eurox>e and the Sicilian Island (from the latter of which most of our importations of ground sumac and ex- tract come) and America. This will enable us to better x>erfect our article, and to pay afair and remunerative price for the crude leaves, which are gathered solely by the poorer classes of country x>eople, who can barely subsist at the x>rices now £>aid for gathering. This has become the more necessary since the equalization of gold and currency, which has deprived us of the x^rotection that this difference really afforded. The grinding of leaf sumac in Virginia has grown from the insignifi- cant business of about 100 tons per annum, in 1865, to the very consider- able business of about 8,000 tons in 1881, which represented $240,000 X^aid directly to the i>oorer classes of people in Virginia, consisting for the most x>art of thousands of colored x^eople, which is their princixml support; and this amount of money is kept in this country, which other- wise would be exported to pay for foreign labor, to the neglect of our own industries. We have made our statement in general terms, and partly in supple- ment to the more full and statistical address which the morocco manu- facturers will submit to your consideration — but not less impressive we W. N. JONES.] SUMAC. 747 trust — for the principles generally will apply to all home manufacturers when they come into competition with foreign importations. Hoping you may appreciate the merits of our humble petition, we are, gentlemen, most respectfully yours — Wm. T. King, Richmond, Va. J. G. Hurcamp, Fredericksburg, Ya. German Smith, Winchester, Va. J. D. Shotwell & Co., Manches- ter, Ya. W. N. Smith, Columbia, Ya. Warner Moore, Richmond, Ya. Martin Bros. & Baker, Man- chester, Ya. W. N. Jones, & Co., Petersburg, Va. Chiles & Levy, Louisa Court- House, Ya. J. M. Williams, Petersburg, Ya. R. J. Young, Richmond, Ya. E. Rosenthal, Alexandria, Ya. W. W. Boswell & Co., Lunen- burg, Ya. Epes & Kelly, Bellenfonte, Not- toway County, Ya. Lynchburg Mfg. Co., Lynch- burg, Ya. Macafee & Bro., Front Royal, Ya. Jno. H. Bryant & Co., Rich- mond, Ya. December, 1881 . The following extracts are taken from the Shoe and Leather Reporter^ SUMAC. This article comes principally from Sicily. It is used in tanning morocco leather, and, to some extent, in dye-works. The American sumac, with which this comes in competition, is grown and ground principally in Virginia, and the product there is 8,000 tons, or 17,920,000 pounds, a year. The duty on foreign sumac is 10 per cent. The importations were, for — Years. j Pounds. Value. 1881 13, 667, 892 21, 895, 670 12, 981, 675 15, 068, 581 $409, 400 588, 911 394, 631 508, 427 1880 1879 1878 Tanned goat and sheep skins (tanned, but not finished) pay a duty of 10 per cent. These skins are tanned in Madras with gambier, &c., where labor costs only 8 cents a day, or in Marseilles with French sumac, and where labor costs 75 to 80 cents a day, and come in at half the tariff put on the finished article. Morocco manufacturers aver this is detrimental to their interests. The value and duties of tanned skins were,, for — Years. Value. Duties. 1881 $1, 101, 249 00 1, 991, 546 00 393, 676 00 378, 094 70 $110, 124 90 199, 154 60 39, 367 60 37, 809 47 1880 . ... 1879 1878 Upper leather of all kinds, morocco, calf, kid, finished sheepskins, and such goods, pay a duty of 20 per cent. French and German glazed kid is the principal leather imported under this head, about two-thirds of the amount being of this description. The value and duties were, for — 1881 1880 1879 1878 Years. Value. $2, 633, 795 31 2, 617, 717 15 1, 590, 020 85 1, 554, 373 74 Duties. $526, 759 06- 523, 543 43 318, 004 17 j 310, 874 74 748 TARIFF COMMISSION. [W. N. JONE-* , All leather and skins tanned, not otherwise specified, pay 25 per cent. duty. It is hard to tell what kinds of leather this can refer to, hut the custom-house officers seem to find some each year. The value of such, and duties paid, were, for — Years. Value. Duties. 1881 $16, 540 18 19, 647 84 15, 633 06 24, 723 64 $4, 135 03 4,911 96 3, 908 27 6, 180 91 1880 1879 1878. DISCRIMINATING DUTY REPEALED. The following discriminating duty in the tariff has been repealed by Congress: “Sec. 2501. There shall be levied, collected, and paid on all goods, wares, and merchandise of the growth or produce of the countries east of the Gape of Good Hope (except wool, raw cotton, and raw silk, as reeled from the cocoon, or not further ad- vanced than tram, thrown, or organzine), when imported from places west of the Cape of Good Hope, a duty of ten per centum ad valorem in addition to the duties imposed on any such articles when imported directly from the place or places of their growth or production/’ The President approved the act to repeal this section May 4. Its immediate effect on our trade will be to reduce the cost of tanned goods from the East Indies purchased in London for the American markets. These have hitherto paid 20 per cent. It will also be likely to affect our direct trade with Calcutta and Madras, as the tanned skins will be purchased selected at, the London trade sales, and brought in here for the same duty as though imported direct. Statistics of imports of sumac into the United States. [In pounds, and gross value at place of export.] Years. 1 Quantity. Value. 1866 Pounds. 13, 500, 000 10, 634, 342 $355, 198 494, 251 536, 085 572, 578 418, 919 420, 823 383, 570 463, 780 511, 941 533, 713 024, 169 736, 390 508. 247 1867 1868 1869 . . 11, 468, 509 9, 634, 367 10, 141, 787 10, 028, 912 . 13, 160, 114 16, 718, 678 16, 542, 548 17, 642, 960 21, 430, 641 15, 068, 581 12, 981, 675 1870 . 1871 1872 1873 1874 . 1875 1876 1877 1878 1879 . 394, 681 588,911 409, 400 1880 21,895,670 1 13,667,892 ' 1881 J. F. SCHOELLKOPF. ] ANILINE DYES. 74 $ J. F. SCHOELLKOPF. Buffalo, N. Y., August 30, 1882. Mr. J. F. Schoellkopf, jr., of Buffalo, manufacturer of aniline (lyes, addressed the Commission as follows : Gentlemen: In addition to my communication of July 27, 1882, I desire to call your attention to the following circumstances : Coal tar is procured from bituminous coal ; benzole, the raw material for aniline oil, is gained from coal tar by distillation. Now, benzole pays a duty of 40 cents per gallon, whereas aniline oil comes in free. These facts certainly must have been misrepresented at the time the present tariff was framed, for it is evident that if the raw material, benzole, is pro- tected, the manufactured article, aniline oil, is justly entitled to the same privilege. Aniline oil, which is used directly for printing black (on cotton), cannot be manufactured as cheaply here as in Europe, owing to higher labor and high prices for acids (sulphuric and nitric acids) used in its manufacture. I have learned that New York and Boston parties are circulating a pe- tition among the larger consumers of anilinedyes, with the intention of reducing the duty on such dies to 25 per cent, ad valorem only. This would leave domestic manufacturers virtually without protection. We must have an absolute protection, and this can only be realized by a specific duty. I would suggest the raising of the specific duty 25 or 50 cents per pound and dropping the ad valorem duty altogether. This would enable home manufacturers to compete with foreign producers. By Commissioner Ambler : Question. Would not that operate inequitably by reason of the fact that there is a great difference in these dyes? Some of them, I under- stand, are cheap and others are expensive. — Answer. Yes, sir. Q. How do they range in price? — A. From $1 to $5 per pound ; the principal colors. Q. I would suggest that a specific duty per pound, to afford any pro- tection at all on the $5 article would be too much on the cheaper arti- cle. — A. But, as I mentioned in my former communication, if we have protection, the domestic competition will reduce the price to a proper level. There are only five manufacturers of aniline dyes in the United States at the present time. Q. Is it not a fact that any rate that operated as a protection on the $5 article would amount to a prohibition on the article that costs $1? — A. It does not seem so, for they are still importing fuchsine, which is a color worth from $2 to $2.50 a pound. Q. Did you mention any specific amount of duty per pound which you think would be proper? — A. Yes, sir ; the rate of duty now is 50 cents a pound, and 35 per cent, ad valorem, and I suggest dropping the ad valorem rate and raising the specific rate 25 or 50 cents per pound. Q. You mean, raise it 25 or 50 cents above the present duty of 50 cents ? — A. Yes, sir. Q. That would amount to a duty of 100 per cent, on $1 dyes, and a duty of 20 per cent, on $5 dyes ? — A. Yes, sir ; but, as I mentioned in my former communication, under these ad valorem duties imported dyes are liable to be undervalued. 750 TARIFF COMMISSION. f J. F. SCHOELLKOPF. Q. Are they generally undervalued ? — A. I do not know, but I think they are, because it cannot very well be detected. I suggest this high duty in order to give the home manufacturers a start. After five or ten years it would not matter if the duty were taken off $ but we must have a large protection to enable us to start. When I was in Europe this spring I was told that if the duty was not taken off in this country the manufacturers there would start establishments in this country, so that we would have plenty of competition. By the President : Q. Will you please repeat that statement ; do you say that the foreign manufacturers themselves would begin the manufacture in this country ? — A. Yes, sir. The president of the largest manufactory in Europe, the Badische Aniline Factory, at Mannheim, told me personally that if the duty was not taken off they would be obliged to start factories over here. I think that shows that the price to-day in this country is as cheap as it can be. Q. How many dyes does that establishment now make 1 ? — A. They make almost all the known colors. Dyes can be made here, in time, as cheaply as in Europe ; but we must have a chance to start the business. ■C. G. VOLTZ.l MALT AND BARLEY. 751 C. G. YOLTZ. Buffalo, N. Y., August 30, 1882. Mr. 0. G. Voltz, of the firm of C. G. & J. S. Voltz, maltsters, of Buf- falo, ST. Y., made the following statement : While mainly agreeing with Mr. Manning and the committee of malt- sters in the views they have presented to the Commission, I differ wdth them materially as to the method of reaching the degree of protection for which we ask. The compromise measure of 25 cents per bushel, it is true, has been adopted by the Brewers 7 Association of the United States. The maltsters, as we now stand, are being discriminated against as manufacturers, especially when barley is low in price, as it will turn out to be during the present season. But the brewers of the United States are now petitioning for the removal of the duty on barley, claiming that they are laboring at a very great disadvantage, as the law now stands. Beer has become a staple article of use for the laboring class, and a luxury for the professional man ; and I believe by reducing the price of the material entering into the manufacture of beer it will be made of better quality than is always the case at present. Inferior materials are be- ing used extensively, to the detriment of the health of the people, and I believe it is against the interest of the government to uphold a high tariff' on malt and barley, for the reason that it restricts their importa- tion. The West has an excess of five million bushels of barley more than last year. This barley is of low value, and with a high tariff the importation of barley and malt from Canada will cease, and the govern- ment revenues will suffer. That being the case, I believe it is for the interest of the government to reduce by 50 per cent, the specific duty on barley. Our own State is a large producer of barley. The West is increasing its acreage and quality of barley, and I believe unless the duty on barley is reduced at least 50 per cent, it will eventually restrict and prohibit the importation of both barley and malt. Although the brewers have compromised on this measure, yet they are opposed to an increase of duty on malt. Beer is being taxed excessively, to the extent of a cent a pound on the malt that enters into its manufacture. The brewer has a hard struggle, and endeavors to get along by substituting a poorer article of beer. Therefore, I think it is for the interest of the public and the government that the material used should be brought down to the lowest limit of cost. As to the protection for the farmer, this duty of 15 cents, with the expenses of brewing, the barley, the freight, wastage, &c., is equal to an average protection of 22 cents to the farmer. But it does not protect the farmer, for the reason that New York State produces equally as good barley, although Canadian barley has a better reputation than the barley raised in this State. I think the barley produced in New York State is equally as good, while a great deal of the Canadian barley is positively inferior in quality. By the President. Question. Do you remember the effect of the reciprocity treaty ? — Answer. Yes, sir. Q. Under the reciprocity treaty barley was admitted free? — A. Yes, sir. Q. Then a duty was imposed after the repeal of that treaty ; what 752 TARIFF COMMISSION. fC. G. VOLTZ. was the effect on the price ? — A. During the war, when gold was at a high premium, that did not affect us ; at an ad valorem duty we were still in a condition to compete with the Canadians. Q. Has it not been asserted by Canadian statesmen, in the discussion of the subject, that the Canadians paid the duty ; have you heard that asserted? — A. With a large crop here, they suffer; but when it is a scarce article, we pay for their barley and help enrich the Canadian farmer. In the past, in our own State, barley has not been cultivated to the extent it is now. By Commissioner Underwood : Q. Do you say that a duty of 15 per cent, a bushel on barley is no protection to the farmer ? —A. It is a protection, locally considered, with the freight and other expenses added. At Buffalo here it is equal to about 2 cents; but I claim that the farmer is not being benefited to that extent. Q. Why not ? — A. Because the State barley that enters into consump- tion is as good as Canadian barley, and yet we pay a lower price, be- cause the Canadian barley issupposed to be better, although unjustly so. Q. How does it acquire that reputation, then ? — A. Through the malt- sters, who have a monopoly in this country. Q. And they are asking for protection? — A. Yes, sir; as manufact- urers and tax-payers. By Commissioner Boteler : Q. You have been engaged for sometime in this business? — A. Yes, sir; as salesman and maltster for twenty years. Q. You consider yourself a good judge of barley, I suppose ? — A. Yes, sir. Q. And you make the statement that the American barley raised in New York is equal to that which is raised in Canada ? — A. Yes, sir ; in some years it is. JEROME JONES. J EARTHENWARE. 753 JEEOME JONES. Buffalo, N. Y., August 30, 1882. Mr. Jerome Jones, of the firm of Jones, McDuffee & Stratton, of Boston, Mass., importers and dealers in pottery, addressed the Commis- sion as follows : I have been an importer and dealer in pottery goods for twenty-nine years continuously, and am familiar both with the imported goods and also with the American ware, as we deal largely in both. Our house is one of a dozen houses in Boston that do business in that line. The facts in the case, so far as I understand them, have been so thoroughly given to the Commission by Mr. Wright that I hardly know what 1 can say in addition. I have examined the figures submitted by Mr. Wright, and heard the statement made by him, and I do not believe there has been a word said to which I cannot subscribe, or even swear, to its accuracy. One of the Commission has referred to the fact that there is a dis- crepancy between the statements made before the Commission previous to this time on this subject and those made to-day. I think those dis- crepancies may come honestly from misunderstanding each other. It has occurred to me since I have been here that there is an explanation which can be given on that point. You will all remember that the pre- mium on gold went up during the war to such an extent that every thing assumed a fictitious value. I have no doubt that if any one could get hold of the prices-current in 1866, when gold was at a premium of 175 to 200, and work upon those figures and compare them with the selling prices to-day, this great difference could be accounted for ; it would ac- count, perhaps, for the immense percentage of difference. I can see no fairer way if you are going to make a comparison of values, than to take the gold dollar as a standard of value. If you have any other standard, you have to go into many figures and get lost in the calcula- tion. I believe this firmly, and it is a conviction of mine that if the tariff' on earthenware was reduced the consumption would be largely in- creased, and where now the poorer classes have to use tin plates, tin cups, and the cheax^est kind of utensils, as well as broken plates, cups, and saucers, they would then be able to use better ware, have a more comfortable home, and would be largely benefited in their surround- ings. At present the American product is brought up in price as near to the tariff as it can be, as is always the case. I have heard it stated that where a combination can be made competition ceases, and just so high as the duty is on crockery ware, so the American product is brought up to that figure. Therefore, if you reduce the duty on earthenware to where it was prior to the war, you will increase its consumption, enable the masses of the people to use a better quality of earthenware, and the revenue of the country will not be materially diminished. If you reduce the duty on earthenware it will bring the American manufact- urer to study the economies of the business; he will prosper, the dealer will prosper, the community will get better ware, and no one will be compelled to use the tin dishes and cheap ware which the poorer man seems now compelled to use. H. Mis. 6 18 754 TARIFF COMMISSION. [JEROME JONES. By the President : Question. I am aware of the very large scale upon which you carry on your business in Boston, and of the very prominent position that your house holds. I will therefore ask you this question : Has there been any improvement in the production of manufactures of American goods ?■ — Answer. Yes, decidedly. The manufacturers began at almost nothing in 1860, and they have now very respectable manufactories in New Jer- sey, East Liverpool, and Baltimore, as well as in several other places. They are making a great deal of ware, and all these centers are adding kilns to their plant, and so far as I know are prospering. Q. What is the quality of their ware? — A. The quality of their ware to-day has not attained in most of the potteries what you would call a reliable standard. The trouble has been, so far as I have been able to judge, in regard to the matter of crazing. Some potters have been able to entirely overcome that defect, and I think all have steadily improved. By Commissioner Boteler : Q. How long have these American potteries been in existence? — A. The manufacture of yellow or Kockingham ware commenced somewhere about the year 1850. That portion of the business has increased from that time until the present, so that now we are not importing any of that ware at all ; the tariff duty prohibits it. Q. These American wares have approximated to the English stand- ard and have nearly reached it, and have grown up under the encour- agement given them by the tariff, have they not ? — A. Yes, sir. Q. Then if they cannot successfully compete with the foreign ware by reason of a low duty they will have to go out of the business, and the people will be entirely at the mercy of foreign manufacturers ? — A. I think a duty of 30 per cent, will enable every kiln burning to-day to continue in the business and prosper. The geographical protection and a 30 per cent, duty would give them an enormous protection, larger than that enjoyed by any kind of merchandise I know of, unless it be silks or liquors. Q. But that is not the question; that is a question between the im- porter and the producer. My question was, if they could not continue that busiuess, as they say, without a larger tariff, we would then be en- tirely at the mercy of the foreign manufacturer? — A. Of course, if they could not continue in the business we would have to be dependent ou the foreign manufacturer. Q. And in that event we should have to pay even higher prices than we are now paying? — A. We must bear in mind that already our manu- facturers have progressed so that not a crate of yellow Kockingham ware comes into this country ; the tariff' is entirely prohibitory. From what I have learned by talking with English and American potters, I have no doubt that with a 30 per cent, duty, together with the geograph- ical protection, the manufacturers of potteries in this country can suc- ceed and prosper. By Commissioner Ambler : Q. I understand you to say that there is not to-day any importation of yellow Kockingham ware into the country ? — A. I do not know of a crate coming into this country, whereas large quantities were heretofore imported. Q. What is the difference in the price of that ware now and in 1860? — A. I do not think there is a variation of 5 per cent. Q. Do you know the relative pi ices in England between the years JEROME JONES. 1 EARTHENWARE. 755 1850 and 1860 and now ? — A. I think the price is higher in England now than it was then, and a little lower in this country than it was then ; about 5 per cent, lower. Q. I understand 3 011 to agree to the statement that the white ware is actually higher now ; that it costs more now to import white ware than it did between the years 1850 and I860, and your own idea is that the difference may be accounted for by the fact that the former witnesses took the prices existing during the war, when gold was at a high pre- mium'? — A. Yes, sir; that is the only possible way in which I think they could make the increase. 1 agree with Mr. Wright in that respect, that there has been an increase in the price of foreign ware. Q. Are you able to give us the price of wares, relatively, to the re- tail dealer then and now ? — A. The figures that I went over before I left home were only in regard to sales to smaller country buyers, and I could not find that the prices are any cheaper now than then. I account for the ware costing more now by the fact that railway transportation and the commercial traveler system have reduced the prices on all sorts of merchandise; the competition is greater. Every large house sends out its commercial travelers to compete against each other, which was not the case twenty years ago. Q. Whatever the reason is, you agree that the ware is now as cheap, or perhaps a shade cheaper, than it was in the period between 1850 and 1860? — A. I should say on the seaboard it was about the same. Q. But is it a fact in the same time the prices in Staffordshire have increased? — A. Yes, sir; they have increased. By Commissioner Underwood : Q. Suppose it was desired to put the American manufacturer on an equality with the foreign manufacturer; do you think the rate of duty recommended by Mr. Wright would do that? — A. I think it would give him 35 per cent, geographical protection, and 30 j)er cent, tariff pro- tection. Q. Admitting that, would it put him on a plane of equality with the foreign manufacturer? — A. It would give the American manufacturer a great advantage. By Commissioner Ambler : Q. Is it a fact that at present, at Trenton or at other points where these manufactories are located, the business is prosperous? — A. So far as I know, it is. I have heard of but two failures in the last year. There have been fewer failures than in almost any other manufacturing business in the United States. I only know that the American potters who want to sell us goods comj^ete against one another with just the same apparent zeal that the English manufacturers do, and I hear of no more complaints from the one than from the other. I have no reason to suppose that there is less money being made by the American than by the English potters. By the President : Q. Is there a combination among the American manufacturers? — A. Most of the time there has been a combination amongst them; whether that exists to day or not I do not know. I know they have a protective association, and in selling their goods to us they have intimated that they can give a 3 per cent, discount for cash, but have added that they did not want anything said about it, for it would make trouble. There- fore, 1 suppose, there must have been some understanding of that kind among them. 756 TARIFF COMMISSION. [JEROME JONEB. Q. Have you observed anything of the kind among the English pot- ters! — A. I have no evidence of it. If they make the price any better than the regular rates they do not seem to make any secret of it. By Commissioner Ambler : Q. Are goods generally brought to Boston on consignment, or are they purchased! — A. I think 90 per cent, of the goods coming to Boston are actually purchased. Q. Your house purchases the goods you deal in!— Yes, sir, entirely; we have no consignments whatever. B. B. GLENNY. J POTTERY MANUFACTURES. 757 B. B. GLENNY. Buffalo, Y. Y., August 30, 1882. Mr. B. B. Glenny, of the firm of W. H. Glenny & Co., of Buffalo, N. Y., importers and dealers in pottery, addressed the Commission as fol- lows : I am a member of a firm which has been existence since 1840. I have been myself actively engaged in this business for fifteen years, and have visited most of the potteries in this country and in England, and am acquainted with their methods of doing business. While I have not prepared any special data on this subject, I have gone over Mr. Wright’s figures carefully, and want to state that they are thoroughly in accord with our own experience, and I desire in every way to corroborate what he has said. In relation to the potteries of this country, I will say that we heard nothing about their having such a hard time until this question of duty came up. They gave every evidence of prosperity before that time. There have been new kilns erected, and more are being erected to-day; and in every way, so far as we can judge from visiting the factories, they aiv in a prosperous condition. {Some firms in our line of business have abandoned the importing of English goods, and gone into the man- ufacture of American goods of late years, with full knowledge of all the questions that are at issue. Generally speaking, I believe that the re- duction proposed to 30 per cent., and the reduction that would be fur- ther made by having no duty on packages or inland charges, would result in a benefit to the American manufacturer. By Commissioner Ambler : Question. How would it result in an advantage to the American manufacturer? — Answer. Immediately after the war, and during the war, the high tariff and the high rate of premium on gold, stimulated the manufacture of pottery in this country to an unhealthy degree, and I think the business would be benefitted under the proposed reduction, because it would tend to drive out certain factories that are not carrying on the manufacture in a business-like way ; and the other factories would be free from that competition. Q. It would give a better opportunity for the application of the doc- trine of the u survival of the fittest,” I suppose ? — A. The point is that there are people engaged in the business of manufacturing pottery who do not have the necessary skill or training in the business to enable them to do it with credit, and they are dragging along an existence which should be terminated ; and the reduction proposed would lead to that result, and I think the whole trade would be benefited. For a year or two there might be afalling off in production, but the final result would be advantageous. There are potteries established in this country doing a good business, under proper conditions, and such a reduction of duty would not interfere with them seriously. Q. The pottery business is comparatively a new industry in this country f — A. Yes, sir ; it is. Q. Are you able to indicate these potteries that, in your judgment, are not carried on with proper skill? — A. No , sir; and I should not feel at liberty to indicate them if I could. 758 TARIFF COMMISSION. [B. B. G LENNY. Q. And you are not able to indicate them either? — A. No, sir. Q. Your business consists in selling to the retail trade? — A. Yes, sir. Q. Can you give us the price paid by the retail merchants for white granite goods, for instance ; say the average price from 1850 to 1860 ? — A. I cannot do that ; I did not go into the business myself until 1867. Q. What was the price of those goods then ? — A. The price then was more than it is now. There has been a reduction in prices since I have been in the business ; there was a high gold premium at that time. Q. After the gold premium ceased, was there still a reduction in price? — A. Yes, sir ; there has been some reduction since, but it is immaterial in amount, and I cannot state the figures. Q. Was there a continual reduction from 1878 until within the last three or four years? — A. Y r es, sir. Q. Yon agree with Mr. Wright, that there has been an increase in the foreign price for the same goods by the addition of 10 per cent, to their price lists? — A. Yes, sir. Q. As a fact, then, foreign goods cost more now than they did when you went into business? — A. No, sir; foreign goods do not cost more now than they did in 1867. There was a heavy premium on gold at that time, and the cost of goods was greater than at iiresent. Q. All you know is that in a general way there has been a continual reduction in the prices? — A. Yes, sir; that is within a few years. My remembrance of the business does not go back before the war. Q. You only speak of your knowledge of the business since 1867. — A. Yes, sir. Mr. Abram French, of the firm of Abram French & Co., Boston, Mass., importers of earthen and china ware, said: I concur in the views expressed by Mr. Wright and Mr. Glenny in regard to the rates of duties which should be imposed upon imported earthenware, and I have nothing to add to their statements, except that I desire to call the attention of the Commission to the importance of the business done by the importers of earthen and china ware in the United States. Nearly all our larger cities have houses engaged in the importation and distribution of earthenware. These houses distribute as large an amount of earthenware goods as the manufacturers of Trenton do; and therefore I think they are entitled to as much consider- ation. We sell some American goods, but the majority of the goods which we sell are imported. We think we are deserving of equal con- sideration with the potters, and all we ask is reasonable protection of our interests. By the President : Q. Can you give an estimate of the amount of business done in Boston in your line? — A. I think the importers there distribute goods amount- ing to two and a half million dollars a year. New York distributes a. large amount; Buffalo and Chicago a very large amount. I cannot give yon any figures that would be accurate, but I think the amount of goods distributed must be larger than those made by all the pottery manufacturers in the United States. WILLIAM R. WRIGHT. J EARTHENWARE. 759 WILLIAM R. WRIGHT. Buffalo, N. Y., August 30, 1882. Mr. William R. Wright, of Philadelphia, Pa., president of “the As- sociation of Dealers in Pottery in the United States,’’ addressed the Commission as follows : I represent the Association of Dealers in Pottery of the United States, and have the honor to be president of that association. It is an organi- zation formed for the purpose of gathering facts, and placing this whole matter of the tariff on earthenware before your body. The present duty on all earthen, stone, or crockery ware, white, glazed, edged, painted, dipped, cream-colored, or printed, composed of earthy or mineral substances, and not otherwise provided for, is 40 per cent. We propose that the duty shall be reduced to 30 per cent. On China, porcelain, and parian ware, gilded, ornamented, or decorated in any manner, the present duty is 50 per cent. We propose that it shall be reduced to 40 per cent. On China, porcelain, and parian ware, plain white, and not decorated in any manner, the present duty is 45 per cent. We propose that it shall be reduced to 35 per cent. According to the law, at present, duty is assessed on packages, inland freight, and ship- ping charges, with 2J per cent, commission in making up the dutiable value. We propose that no duty shall be assessed thereon. We esti- mate that the revenue will not be materially changed, as the increased consumption will offset the reduction in the rates and mode of assess- ment. Our reasons for proposing these changes are as follows : Because a 40 per cent, duty on earthenware as now assessed is an actual duty of 50 per cent, on the goods, and affords a protection of 85 to 90 per cent, to the American manufacturers. Because earthenware is an article of necessity for the comfort and convenience of the masses of the people, which they should be enabled to purchase cheaply. Because the present highly protective rate of duty on pottery ware limits consumption and makes an article of necessity a luxury to the masses of people. Because the present duty is a war duty, and the necessity for its im- position has passed. Because a lower rate of duty would cause an increased consumption, and would not seriously reduce the revenue. Because the importation and distribution of pottery is as legitimate a business as is its manufacture here, and the interests of those engaged in it as worthy of consideration. Because these highly protective rates of duty on pottery ware benefit the manufacturers only, and are a detriment to the workmen employed in the business. Because, by assessing duty as at present on packages, inland freight, and shipping charges, an onerous and unjust discrimination is made against the lower giade of goods which are consumed by the masses. Because, with the proposed reduction, there will remain ample pro- tection to the American manufacturers, and they will share the increased consumption and be able to furnish more steady employment for their workmen. 760 TARIFF COMMISSION. [WILIIAM R. WRIGHT. Because, until American manufacturers and artisans cease to rely upon government aid for the advancement of their industries they will never be able to show r what their genius can achieve. In regard to the first reason, “Because a 40 per cent, duty on earth- enware as now assessed is an actual duty of 50 per cent, on the goods, and affords a protection of 85 to 90 per cent, to the American manu- facturers,” I would say that I have taken 100 crates of earthenware as at present imported, and I have figured them carefully at the discounts current to day, and I obtain the following result: A . — Calculations on one hundred crates earthenware , being a fair average of the goods as imported. [Same assortment as on B.] If bought in 1882 under a 40 per cent, tariff they net the foreign manufacturer $3,019 Geographical protection : Per cent. Packages, stra w, packing, iron bands, ,000, at 6 per cent 18 f Marine freight, 5,500 teet, at 10s. aud 10 per cent 362 12 1, 035 34 Tariff protection : Total cost of goods on shipboard $3, 671 Commission, 2-j per cent 92 3,763 Duty, 40 per cent 1, 505 50 Customs fees, entry, oaths, and brokers, 30 cents per package . 30 1 1,535 51 Total cost and protection at seaboard 5,589 85 The inland manufacturers are still further protected by railroad freight and break- age. The gross price list has been advanced and the discount reduced since the tariff was 24 per cent. B. — One hundred crates same goods. (Same assortment, &c., as on A.] If bought in 1857 to 1861, under a 24 per cent, tariff, they would have netted the foreign manufacturer Geographical protection : Packages, straw packing $259 Inland freight, shipping charges, &c 156 Marine insurance, certificates, &c.* 60 Interest, ninty days, on $3,000* 45 Ocean freight, by sail, 5,500, at 7 s. and 5 per cent 243 Tariff protection : Total cost of goods on ship $2, 949 Commission, 2-J per cent 73 $2, 534 763 3, 022 Duty, 24 per cent 725 Custom fees, entry, oaths, and broker’s fees, 30 cents per package 30 755 Total cost under 24 per cent, tariff at seaboard 4, 052 * Goods coming by sail, both interest and insurance higher. WILLIAM R. WRIGHT.] EARTHENWARE. 761 . C. — Calculation showing what would he duty paid and protection afforded under proposed tariff. Cost of goods at foreign market $3, 019 Geographical protection : Per cent. Packages, straw, &e $397 13 Inland freight, &c 204 Of Marine insurance, certitiaates, &c 54 l| Interest, thirty days, on $3,600, at 6 per cent 18 $ Marine freight, 5,500 feet, at 10s. and 10 per cent 362 12 1,035 34 Tariff protection : Cost of goods $3, 019 Proposed duty 30 per cent 906 30 Custom fees, oaths, &c 30 1 936 31 Total cost and protection 4, 990 65 Under 24 per cent tariff, foreign manufacturers netted $2,534. To-day, under present tariff, they would cost here, duty paid, $5,589, being an advance of, say, 116 per cent. Under proposed tariff they would cost, say, $4,990, being an advance of 96 per cent. So that, adding to the tariff protection the geographical protection which the American manufacturers enjoy, and which is a protection that cannot be changed, we find that they have protection to-day of between 85 and 90 per cent, on their wares. I propose to speak next to the reason that “ The present duty is a war duty, and the necessity for its imposition has passed.” The tariff’ on these goods from 1857 to 1861 was 24 per cent. In 1861 it was raised to 25 per cent, and remained there for about a year. In 186*2, the government finding large sums of money necessary for the prosecution of the war, Congress passed an act entitled “ An act increasing tem- porarily the duties on imports, and for other purposes.” Under this act, in which the word u temporarily” is used, the tariff on earthenware was increased from 25 to 35 per cent. In 1864, under our internal-rev- enue laws, domestic manufacturers were taxed 5 per cent, on their pro- duct, and, to make things even, the tariff on earthenware was increased 5 per cent, gross, or from 35 to 40 per cent. This was in 1864. It has remained from that day to this at 40 per cent., notwithstanding the fact that all the increase above 25 per cent, was eminently a war increase, and was so stated at the time. It was evidently not the intention of Congress that this increase should be permanent, for they used word “ temporarily ” in the act. Soon after the war the domestic manufacturers had this internal revenue tax of 5 per cent, removed. So that I can safely claim that all of the tariff above 25 per cent, on earthenware was a was* measure only, and was passed as, and was intended when it was passed to be, a temporary measure, to be repealed when the necessity which called it into existence had passed away. I next propose to speak on this head: “By assessing duty as at present on packages, inland freight, and shipping charges, an onerous and unjust discrimination is made against the lower grade of goods which are consumed by the masses.” The price of packages in Staffordshire, England, where the great bulk of the foreign goods come from, varies but slightly in accordance with the grade of the goods ; in other words, on very cheap goods used 762 TARIFF COMMISSION. [WILLIAM R. WRIGHT. by the very poorest class of people, the packages are not more than 10 per cent, lower than the prices of the higher grades of goods. Conse- quently the transportation expenses are exactly the same on one grade of goods as on the other. Goods brought to this country are charged by measurement — so much per ton of forty cubic feet. Therefore the poor man’s goods, when they reach this country, have paid a protection on the packages and charges of freight a much higher percentage than the man who uses the better class of goods pays. In that way we feel that the law requiring a duty to be laid on packages and charges is an unjust discrimination against the laboring classes of the country. The price of packages abroad — I may say, owing to the scarcity of wood there, which is getting year by year more scarce, and the high price of straw — has increased very materially since the tariff was 24 per cent. The price of packages and straw in all the manufacturing centers abroad is 33 to 50 per cent, higher than it was when the tariff was 24 per cent. Besides that, we require a better and stronger kind of pack- age. We require the manufacturers to put two iron bauds around each crate and to seal the hogsheads to prevent robberies on the way, which adds very much to their cost. I propose next to speak to this reason: u Because these highly pro- tective rates of duty on pottery ware benefit the manufacturers only, and are a detriment to the workmen employed in the business.” That applies, so far as I know, only to pottery ware ; it is not intended to be a general statement. But I am to confine my remarks entirely to the subject I have under discussion. And in regard to that I would say that, in all the arguments adduced to support the pottery manu- facturer’s claim for an increase in the rates of duty on pottery, much prominence is given to the enhanced rate of wages they have to pay as compared to what is paid in England. This is simply to say that they are doing business in the United States, where a highly protective policy makes a nominally high rate of wages an absolute necessity. But when the actual condition of pottery artisans and laborers in the two countries is fairly weighed, we find that the higher cost of labor in the United States is more than compensated by the higher rate of protec- tion afforded under the present rates of duty, and the manner in which the duty is assessed. In a complicated manufacture like that of pottery, with its numerous branches, any tabulated statement of the prices pai d for labor would be of but little value to any but those who are familiar with the techni- calities and details of the business, and it would be out of place to occupy your time with such intricate statements. As bearing on this question of labor, it may be stated here that the English pottery operative is better paid, and lives in more comfort, than the average of English workmen, and we are assured on competent authority that wages in the Staffordshire potteries have increased 40 per cent, during the last thirty years, while the rate of taxation and the cost of living have been much decreased. With the most sincere desire to get at the facts in regard to the con- dition of labor at our home potteries we have found it difficult to get the desired information. We gather, however, the following facts : The price of labor was only increased 10 per cent during the war, when the gold premium ruled so high and manufacturers, by their own statements, were reaping rich harvests of profit. Shortly after the war this increase was taken off, and now wages of Trenton pottery operatives are lower than they were before the war, when the duty was only 24 per cent. It is the opinion of intelligent pottery operatives that an increase in WILLIAM R. WRIGHT.] EARTHENWARE. 7Gb the rate of duty would not result in any increase of wages, and they aver that the petition which they sent to Congress in March, 1878, and of which the following is a copy, fairly expresses their views at the present time : “ To the Senate and House of Representatives : “We, the operative potters of the city of Trenton, being convinced by experience that a high rate of duty on crockery-ware yields no benefit financially to the workingman, aud is inimical to his interests in its effects in increasing the price of living generally, respectfully peti- tion your honorable bodies for such a revision of the tariff as will reduce the rates on crockery to a revenue basis. “We respectfully submit that the only plea upon which a high pro- tective tariff can be justified, is that it enables the manufacturer to pay better wages to the laborer than he receives in European countries, and that the artisan thus shares in the benefit of a higher price which pro- tection allows the manufacturer to obtain. This not being the case, a tariff* levied in the name of ‘‘protection to American industry ’ is a false pretense and a delusion. ‘fit is highly injurious to the workingman when his fair share of its benefits are withheld and all its benefits are appropriated by the manu- facturer, because it strengthens the task master 1 , while its indirect results being to increase the price of all necessaries, it weakens the task-doer. “ In its practical operation it is monopoly for the benefit of the few at the expense of the many. “ Such being our experience, and believing that, with the exception of the privileged few, who reap its fruit, a high tariff entails disadvan- tages for which it offers no compensation, we respectfully ask for such a reduction as will destroy monopoly and encourage healthy competition and your petitioners will, as in duty bound, ever pray, &c.” The statement so persistently made by the home potters, in their peti- tion to Congress and elsewhere, that 90 per cent, of the whole cost of production is labor is misleading, and is a sort of conjuring with figures. The facts are that 45 per cent, is the average paid by pottery manufact- urers in the shape of wages on the amount of their production. To reckon the labor needed to produce the necessary materials, fuel, trans- portation, &c., is deceiving and conveys an entirely erroneous impression. With all the pottery manufacturers’ concern for their workmen, they lose no opportunity to reduce their wages, nor do they hesitate to bring out foreign labor, when it siv's them to do so, and, high protectionists as they are, do not object to the importation of foreign labor on free- trade principles. I propose now to speak to this reason : u Because, with the proposed reduction, there w 11 remain ample protection to the American manu- facturer, and they will share the increased consumption and be able to furnish more steady employment for their workmen.” The proposed reduction will still leave a protection to the manufact- urer of earthenware in America of G7> to 70 per cent., as compared with the 85 to 90 per cent, they now enjoy, which, taking into consideration the advance in the list and reduction in discounts since the tariff was 24 per cent., will afford them a protection of over 90 per cent, on prices obtained by the foreign manufacturers during the period of the 24 per cent, tariff. I will occupy but a very few minutes more of your time. The gentle- men who have appeared before the Ways and Means Committee and 764 TARIFF COMMISSION. [WILLIAM E. WRIGHT. before your honorable body have constantly made complaints of a com- bination among the foreign manufacturers to keep up or depress the price of earthenware with a view to influencing this market. I have visited the leading maikets of Europe almost every year for the last fifteen years, and I have failed to find the slightest combination as re- gards prices there among them. There is no class of men I have ever met among whom the competition is so eager or who are so jealous of each other as the manufacturing potters of Great Britain ; and as to there being any combination among those potters, or between them and the dealers on this side, it is entirely out of the question. I call your attention to the fact that in the remarks you have heard on this subject there has been no mention of the fact of the gross price being advanced 10 per cent, in 1872, nor of the fact of the discount being 10 per cent, less to-day, and therefore the cost 20 per cent, higher than it was under the 24 per cent, duty ; in other words, foreign manufacturers get 18 to 20 per cent, more for their goods now than they did under the 24 per cent, tariff. That I do not say is applicable to other for- eign goods, but it certainly is to earthenware. On the contrary, all the arguments we have heard from the other side of the question have tended to create the impression that the foreign manufacturers have greatly reduced their selling prices since the tariff was changed from 24 to 40 per cent. We desire to challenge that statement. We have heard it intimated that a scheme for specific duties would be promulgated. We think it is impracticable ; but if such a plan can be discovered we shall consider it a very valuable discovery. In conclusion, gentlemen, I hope that I have been able to impress you with the fact that earthenware is one of the most heavily-protected arti- cles of prime necessity that comes into the country at the present time; that it is one of those articles in which the poorer classes of the people are perhaps as deeply interested as in almost any other. We have not gone before Congress and asked for this reduction. As soon as this Com- mission was created we considered that the proper place to make our appeal was here, and we did not go before Congress or the Ways and Means Committee. Our opponents chose a different course. They went before the Ways and Means Committee, after your confirmation by the Senate, and tried in the expiring days of the Forty-seventh Congress to get a bill rushed through increasing the duties on earthenware 50 per cent. In other words, raising it from 40 to 60 per cent. ; and it struck us as being the more inexcusable to slight this Commission from the fact that instead of corning out and saying, “This is a bill to increase duties on earthenware,” it was entitled “An act to correct decisions and simplify the tariff on china and earthen ware”. I respectfully refer the Commission to the House of Representatives bill No. 6713, introduced by Hon. Mr. Brewer (himself a master potter) July 3, read twice, and referred to the Committee on Ways and Means, of which I have a copy. By Commissioner Kenner : Question. You object to the rate of duty, and first to the commissions and charges on the packages. Do you object in any way to the classi- fication under the tariff of the articles that you speak of? Is the classifi- cation in the present tariff satisfactory to you ? — Answer. The classifica- tion as it stands in the tariff to-day, is, I thiuk, about correct. By Commissioner Ambler: Q. I would like to make a few inquires based upon Tie difference in the statements made by yourself and those made before us by Mr. Brewer WILLIAM R. WRIGHT.] EARTHENWARE. 765 and others. And first let me ask you this : You speak of this matter of geographical protection and you have given us the rates ; are you able to give us the items of the geographical protection on an average crate of ware? — A. Yes, sir. Q. Well, take an average crate and tell us what it is. — A. The geo- graphical protection, as I have made it out here, is on 100 crates. In the first place, the cost of the packing — straw and package on that 100 crates — amounts to about $400, or about 13 per cent. Q. That is to say, about $4 a crate ? — A. Yes, sir. Of course, when the goods come here, we have to pay 40 per cent, duty, which brings it up to nearly $6. Q. Is that a matter within your own knowledge, or do you get it by hearsay? — A. That is a statement within my own knowledge, from daily experience in the business for twenty years. Q. Are you now engaged in this business?— A. Yes, sir; and have been for twenty years -past. Q. What is the next item of cost ? — A. The next item is inland freight and shipping charges from the potteries down to the sea port, and the expenses in the sea port, which amounts. to $2.05, or about 6§ per cent. So that the cost of the package, the inland freight, and shipping charges altogether amount to about 20 per cent, of the value of the wares on the average invoice. On very cheap wares it is much more, and on high-priced wares less. But I am taking an average 100 freights as they are cousumed in the country to day, and that is a fair average statement. The next item is consul’s fees. They are small, to be sure, and amount to one-half or five-eighths of 1 per cent, on the value of the earthenware imported. The next item is marine insurance. Q. What is the rate paid for marine insurance ? — A. I suppose 1 per cent, would be a fair rate. Perhaps in winter it is higher, while it is sometimes less in summer; but we estimate it the year round at 1 per cent, as a fair rate. The next item is the interest on the goods from the time we have to pay for them, which is when the goods are made, to the time when we can land them on these shores. I have taken a very small average of thirty days. It takes a week or ten days generally to get the goods packed and sent down to the port of shipment. The average ocean steamer will not bring them over in less than fifteen days, and before we can get them into our store in a condition for dis- tributing, thirty days are consumed altogether. The next item is ocean freight on these 100 crates, which amounts to $3.00 a crate. I have taken a very low rate of ocean freight. The rate ruling during the past twelve months has been 12s. Gd., and 10 per cent, for forty cubic feet. But I have taken a lower rate than that so as to be within the actual facts, and so that if I am called upon to prove any of my statements I can convince you that I have confined myself within the facts and have not gone beyond them. Ocean freight is assessed by measurement, forty cubic feet counting a ton, and on steamers it is always customary to add 10 per cent, to that for primage. My house is largely interested in steamships, and I am thoroughly conversant with this matter of freight, and the rate I have given yon of $3.60 for freight is a very fair rate. We have the management of the only American line of steamers crossing the Atlantic, and we have a thorough knowledge of these rates of ocean transportation. Q. That makes how much? — A. That makes $1,035, geographical protection. Q. These, then, are the items, all included, in what you call geo- graphical protection? — A. Yes, sir; $1,035 per 100 crates. 766 TARIFF COMMISSION. [WILLIAM R. WRIGHT. Q. That does not include the duty? — A. No, sir; the duty is the next item. The duty on these goo :1s is 51 per cent, on the value of the goods, in reality, because to the 40 per cent, duty must be added 11 per cent, as duty on the packages, and charges and commissions. Q. Is not that the same whether it is American or English manufact- ure ; I mean the duty on the packages '? — A. I am very glad you asked me that question, for I omitted to touch on that subject. We consider the packages are a proper geographical protection for this reason, that in this country our domestic manufacturers get back a large proportion of their packages as “empties.” The consumer merely pays the freight and returns the package, and the price of the package is deducted on a large proportion of the goods. Another large proportion of the goods are packed in car-loads, in bulk, without any packages, and the cost of packages is saved. They are shipped in that way by cars which are loaded right alongside of the packing-rooms of the potters, and they are shipped 1,000 to 1,200 miles away ; carry perfectly well and get there without any cost for packages whatever. Q. What class of goods are those? — A. The class of goods that we are asking a reduction from 40 to 30 per cent, on — earthenware. Q. There is no expense for packing, then, except the straw? — A. No, sir; the only goods packed that way in past years were what we call stoneware ; they have always been packed in that manner. But they are now packing common ware and white granite ware that way. They pack them in East Liverpool and ship them to points in the West. Q. Do they also ship them in that way from Trenton? — A. I do not know what the fact is in regard to the Trenton potters, but the dealers in the West who buy their goods at East Liverpool have them shipped in this way. I have no direct knowledge of its being done at Trenton, although 1 have not any doubt that it is done there. I know that in regard to the goods they sell in Philadelphia and the neighboring cities, the consumer pays nothing for the package, but ships it right back and deducts the amount. They only charge $2 and $2.50 in Trenton for the packages, and if a man chooses to keep his package and make a turkey, coop of it, he can do so. But I can assure you that a foreign package cannot be imported that does not cost between $5 and $G, and nearer $6 than $5 ; the charges and duty on it bring it to that. Q. That is the charge at which the package is put in there, with the duty added? — A. They are charged so many shillings a package, and that is all we pay directly for the packages. But when we come to get that sterling charge here and pay 40 per cent, duty on it, it costs us be- tween $5 and $6. Then there is another point in regard to these pack- ages; they only cost the manufacturer here a tithe of what they cost abroad. In the first place, wood is very much cheaper in this country, while it is one of the dearest things they have in England, and the rn’an- ufacturer here can buy sugar hogsheads and different kinds of packages at a nominal price. As for the straw, I need hardly say to a Western man that it is more abundant in this country than Great Britain. Oat- straw is especially high in England. It is nearly all brought from the Continent to Great Britain, and the charge for it there is something enormous. Therefore, the foreign packages must, of necessity, cost very much more than the domestic packages. And in regard to the way in which they pack their goods in this country, getting the “empties” back and getting the goods in car-loads, I think we are perfectly entitled to consider that, too, as a geographical protection. Q. You mentioned Philadelphia as a point from which they were re- turned. — A. Yes, sir; from Philadelphia, New York, Baltimore, and WILLIAM R. WRIGHT.] EARTHENWARE. 767 neighboring cities. I suppose if the Trenton manufacturer sells his goods in New Orleans or Chicago, the freight would prevent the ship- ping back of the empty package; but there is an offset to that. I have made no mention in my remarks of any breakage on foreign goods. There is a breakage on foreign goods, before they land in this country, and it is considered not excessive to estimate the amount of breakage at 5 per cent. That 5 or 3 per cent, breakage on goods will considerably more than offset any u empties” that may not be returned, and leave us a clear right to claim the entire cost of the foreign package as a geo graphical protection. We believe we are fairly entitled to consider the foreign packages as entirely a geographical protection. Q. But there is also a breakage on domestic packages? — A. So there is on foreign goods after they reach this country. 1 am speaking about the breakage of the goods before th^y land on our shores. Of course, in handling them in foreign countries before they reach shipboard some breakage occurs, and after they are aboard the ship the motion of the vessel at sea causes considerable breakage. After they are landed, I grant you, the domestic manufacturer runs the same risk as to breakage as do imported goods. Q. Is the percentage of breakage greater or less on the foreign or domestic goods? — A. That is a difficult question to answer, because we cannot separate the breakage before it reaches this country from the breakage after it reaches tliis country. But I am satisfied that the breakage is about the same on goods after they reach this country, where they are shipped to different points. There is a difference in the lines of transportation. Some of them handle goods carefully, and some smash them. Domestic manufacturers find the same difficulty. Q. I do not know that I fully understood you; but I gathered the idea from your remarks that foreign potters were really as well paid as those in this country ? — A. I did not say so. Q. I was not quite sure that I understood you, and that is the reason I called your attention to it. — A. My idea on that subject, as far as I ha ve been able to get at the facts, is that they pay higher wages in this country than abroad. Q. About what is the difference in jiercentage? — A. I should say that where they pay $1 abroad, the same man for doing the same work in this country would earn $1.45 to $1.50. Q. You think that is the extent of the difference ?— A. I think that is a full allowance. Q. The testimony we have heard on the subject would indicate that the percentage was much larger. — A. We have gone very" carefully into that matter, and, as far as we can ascertain, the foreign manufact- urer gets his labor, in making the same article, at about that difference of percentage. I am not speaking of wages by the day or week, but of the rate paid per dozen. Take the article' of plates, that cost $1.50 in Trenton to make, and the foreign manufacturer would have to pay about $1 for the same work, or 33^ per cent. less. The difference be- tween the Staffordshire price and the American price is about 33^ per cent, in favor of the Staffordshire manufacturer. Q. Your idea is that that is more than counterbalanced in the enhanced price that the workman has to pay for what he eats and wears? — A. That is our idea, and it is shared by the workmen here, as shown by the petition which I have read to you. Q. Do you know whether it is a fact or not that the American work- men, say those at Trenton, live better than they do on the other side of the water? — A. 1 have heard it stated as a fact. My knowledge of how 768 TARIFF COMMISSION. [WILLIAM R. WRIGHT. the workmen live in Trenton is exceedingly limited. But from what I have seen of them, I think the potters in Staffordshire, who are cer- tainly the best paid artisans in Great Britain, live as well as they do in this country. In other words, I believe that $1 a day wages in Eng- land enables a workman to live as well as $1.50 wages in this country does. Q. Do I understand you that in point of fact the price of goods sold in Staffordshire has increased since 1859? — A. Yes, sir; between 15 and 20 per cent. Q. We have been led to suppose differently from statements indicating there was a reduction. — A. There has been no reduction. Goods have never been as cheap as they were between 1857 and 1801, when the tariff' was 24 per cent., and are not as cheap to-day by 18 to 20 per cent. Q. As I understood from Mr. Brewer’s statement, there is a scale or list by which sales are made? — A. Yes, sir. Q. And 1 understand you that that scale has been increased ? — A. Yes, sir; fully 10 per cent. Q. When was it increased? — A. In 1872. Q. What was the rate of discount from the scale in 1859? — A. The rate of discount on common goods was 37J percent, on one kind and 40 per cent, on the other. Q. What is it now? — A. On the cheapest goods I have heard of, 30 per cent. On the bulk of our goods we are getting 27 £ per cent., while during the 24 per cent tariff we got a discount of 37 h to 40 per cent, on the same goods. I am speaking of common goods, known as C O goods. They are under the 40 per cent, class. Q. Does the same rate run through the scale, that is, on the higher- priced goods? — A. On the higher-priced goods there is a difference, but it is not so marked as on these goods. The higher-priced goods are dearer now than then, but not as much dearer as the lower grades of goods. Q. Could you give us the percentage? — A. I could figure it out in a minute or two. I will state it in general terms. The higher priced goods, that is, white granite ware, is about 5 per cent, higher than the same goods would have been between 1*57 and 1861. Q. You speak of the price to the importer?— A. Yes, sir; I speak of the price the manufacturer gets for his goods. Q. Are you able to tell us what the comparative jirices are to the retail dealer then and now ? — A. Only from hearsay ; I have not any knowledge on that point. Q. If you have a business knowledge, or are able to give an approx- imate statement, I would be glad to have it. — A. I should suppose that the prices at the sea port or place of importation would be the only cri- terion, because during the 24 per cent, tariff the transportation to the interior was very different from what it is now, and would show a different result. I suppose the difference there to the retailer is about the same as the difference is to the manufacturer abroad — about 15 or 20 per cent. Q. And that difference an increase? — A. Yes, sir. Q. The statement was made to us that there was a large reduction, and we wanted to understand how that was. — A. We directly contradict that statement, and challenge it. Q. You say that instead of a reduction there has been an actual rise ? — A. I know of my own knowledge that the manufacturer is getting from 18 to 20 per cent, more for his goods to-day than he was under the 24 j er cent, tariff'. I think the statement that was made by the other side re- WILLIAM R. WRIGHT.] EARTHENWARE. 769 ferred to the price of goods when gold was up to 200 or 300 per cent., and not to the 24 per cent, tariff. Q. The gentleman seemed to give us the price both before, during, and since the war. The claim, as I understand, was made distinctly that there had been this decrease, and I think he gave us what was termed the scale then and the price list then and the discounts, although I may be mistaken. — A. If the gentleman made that statement he was entirely mistaken in his figures. By Commissioner Underwood : Q. I understand that you are an importer and not a manufacturer of these goods? — A. Yes, sir; I am not a manufacturer; but I understood that you wished to hear both sides of the question. Commissioner Underwood. So we do, and we have heard both sides. The Witness. There is one point I omitted to speak upon, and that is the duty the government got under the 24 per cent, tariff and the duty it gets under the 40 per cent, tariff. On these 100 European crates the government to-day collects $1,484. Under the 24 per cent, tariff, at the prices then current, the government only collected $725, showing that the government to-day under a 40 per cent, tariff is getting a little more than double what it did under a 24 per cent, tariff. In other words, it is getting more now than if the tariff was 48 per cent, at the time when it was 24 per cent., and the difference between those figures is the duty on the increased value of the goods imported — the same goods. By Commissioner Ambler : Q. Is this class of goods generally purchased abroad or consigned ? — A. All I know of are purchased abroad. We purchase all our own goods, and I think these gentlemen who will follow me purchase all theirs. I mention this fact to show the great increase of protection that is now enjoyed. H. Mis. 6 49 770 TARIFF COMMISSION. [D. LANDRETH. D. LANDRETH. Buffalo, N. Y., August 30, 1882. The following communication from Messrs. D. Landreth & Sons, of Philadelphia, Pa., was read and ordered to be printed : To the Commission on Tariff Revision : The undersigned respectfully represent that they are growers or pro- ducers of and dealers in seeds of garden vegetables, and in the produc- tion of which many persons are engaged. The competition in the sale of seeds induces many who are not pro- ducers, but dealers merely, to cheapen prices, which they are enabled to do by importations from Europe at much less cost, the 20 per cent, duty of the present taritf being added, than the article can be produced for in the United States. We beg leave to request by the Commission a consideration of the subject in the light of these facts : First. The industry in this country requires the use probably of 30,000 acres of land, and gives employment to thousands of people both in the fields and in workshops and offices. Second. That the pauper labor of Europe comes in direct competition with a home industry capable of supplying, in a superior form, all the wants of the country, with the exception of a few unimportant articles. Third. That the humid climate of the seed-growing section of Europe, by enabling the production of a larger yield per acre than can be grown here (at the same time, however, producing seed of less vital power), is an additional factor to that of wages in cheapening the cost of the foreign article. Fourth. That American grown seeds, by reason of their acclimatiza- tion, are better adapted to the American climate than the foreign, and are preferred by all cultivators of experience ; they are also purer in qual- ity, being grown by more intelligent people. Fifth. It is impossible to detect any difference by inspection in the quality of the seeds of the foreign and American grown article, which fact permits the sale of the foreign as American, and which can be and is done at a less price than the latter can be produced. And we therefore urge that the rate of duty of the present tariff is inadequate as a protection to an important American industry, and that the Commission recommend an increase to a rate of 100 per cent. D. Landreth & Sons. Philadelphia, Pa., August 12, 1882. JOHN B. MANNING.] MALT. 771 JOHN B. MANNING. Buffalo, N. Y., August 30, 1882. Mr. John B. Manning, of Buffalo, addressed the Commission as fol- lows : I would state that at a meeting held by the maltsters of the city of Buffalo recently a committee, consisting of Messrs. Daniels, Crafts, and myself, were requested and instructed to appear before you and submit certain facts which we think will convince you that more injustice is being done to our industry, which is one of the largest in this country, than is suffered by any other important interest, by reason of the pres- ent duty on malt as compared with the duty on barley. We submit the following statement of our case: The undersigned maltsters and brewers of the city of Buffalo, N. Y., do most respectfully call your attention to the following facts : During the existence of the reciprocity treaty malt was subject to a duty of 20 per cent, ad valorem, the same as now, while barley was ad- mitted free. When that treaty terminated, in 18GG, a duty of 15 cents per bushel was placed on barley, and the duty on malt, through an oversight on the part of our government, was allowed to remain un- changed. The result of this is that many times during the past few years the Canadian maltsters have entered and paid duty on their manu- factured article at a less cost per bushel than the American maltster has been obliged to pay on the raw material, barley. As the law stands now it practically discriminates against the home manufacturer and in favor of the foreign. Surely the framers of the new law never contemplated such a state of things. The maltsters of this country, after bearing this injustice for a number of years, petitioned Congress to redress their grievance, and had a bill introduced in 1878 to change the duty on malt from 20 per cent, ad valorem to 35 cents specific. This met with opposition from some brew- ers. The result was that a conference was held in the city of New York during the winter of 1878, composed of the executive committee of the United States Brewer’s Assbciation and a number of prominent malt- sters, and a compromise was effected, viz, 25 cents per bushel specific. The action of the executive committee of the brewers was ratified and confirmed without a dissenting voice at the United States brewers’ con- gress, held in the city of Baltimore in 1878, and a committee was ap- pointed of five of their number to act with a committee of five malt- sters, with instructions to repair to Washington and urge the passage of a bill changing the duty to 25 cents per bushel specific. Owing to the late stage of the session, the bill was not reported by the committee. After the compromise was agreed upon, the only opposition manifested to the bill came from Canadian maltsters and commission men who sold their malt on this side, together with the very few brewers who buy their malt of Canadians. At the United States brewers’ congress, held in this city in the mouth of May, 1880, the question was again brought up, and again the con- gress reaffirmed its former action, with only two dissenting votes (both buyers of Canadian malt), and also at the United States brewers’ con- gress held in the city of Chicago last summer. The compromise bill passed the House of Representatives in the month of June, 1880, unan- imously, was sent to the Senate, referred to the Finance Committee, and by said committee reported favorably ; but, owing to the late stage of the session, it failed to pass. 772 TARIFF COMMISSION. JOHN B. MANNING. The friends of the measure, finding that many brewers, through mis- apprehension, had been induced to unite with a few brewers who pur- chase Canadian malt in remonstrating against the bill, deemed it ad- visable to have the bill recommitted for the purpose of affording an opportunity to all interested parties to discuss its merits and to show to those brewers who are not familiar with the subject that in this matter the brewers and the maltsters of this country have a joint interest. This for the following reasons : First. It is a compromise measure between the brewers and maltsters, and they are honorably bound to support it, not only on the ground of fairness, but that their interests are so closely identified with each other that what seriously affects the one must of necessity affect the other. Second. It is the interest of the maltster, as well as that of the bre wer, to further and protect the brewing interests, which he certainly would do by promoting the proposed change in the duty on malt, for now a very few brewers, probably not to exceed 20 out of 3,300 in the United States, get their supply of malt from Canada; and with what result to the trade at large? Those 20 are enabled to buy their malt for cash (the Canada maltster invariably sells for cash) at 10 to 15 cents per bushel less than their neighbors, and, as a result, they are enabled to undersell them. Unhealthy competition follows, bringing ruin and disaster in its wake. If this change is effected, it will only place our maltsters on an equality with the Canadian, as he buys his barley direct from the farmer, while our maltsters are obliged to buy Canada barley after it has passed through several hands, and the cost is thereby enhanced from 5 to 8 cents per bushel. The cost of labor and living is less in Canada than in this country, and consequently the cost of manufacturing less, al- together amounting from 10 to 12 cents per bushel in favor of the Can- ada maltster, while the change asks for only about 7 cents per bushel advance on the average duty paid for a number of years, as conceded by its opponents. Thus you will see that Canada maltsters would still be able to compete with the home manufacturer; but, as there are some 350 maltsters in this country, it would seem that there was sufficient competition to protect our brewing interests without seeking it from abroad. Third. As American manufacturers, we are entitled to protection from our government as well as other manufacturers and interests. The brewer is protected by a prohibitory duty , viz, 20 cents per gal- lon on beer in barrels or casks, and 35 cents per gallon in bottles, amount- ing to $6.20 per barrel. The farmer is protected by a duty of 15 cents on barley, and the hop-grower 8 cents per pound on hops. In the face of these facts, does it not seem strange that men have the assurance to claim that u the maltsters of this country would become monopolists by this change of duty? Prices would be raised, which would either ruinously cut down the brewers’ profits or force them to make inferior beer.” Why, if the whole increase of duty as proposed should be paid by the brewers, it would be only 14 cents per barrel ; less than a half cent per gallon to the brewer buying Canadian malt; and, for the reason set forth above, the only effect it would have on the brewers at large would be to place them on an equality with their more wealthy competitors, thereby helping the poor and struggling brewer. But any one at all familiar with the effect of the tariff on barley knows very well that the duty of 15 per cent, is virtually paid by the Canadian farmers ; so would the increased duty on malt be paid, not by the consumer on this side, but by the manufacturer who exports it to this country. And why ? For the simple reason that Canada has JOHN B. MANNING.] MALT. 773 no market for either its surplus barley or malt but this country, and when sent here it must be governed by the market values on this side. The maltsters of this country unanimously ask that the duty on malt be changed to 25 cents per bushel of 34 pounds ; the brewers of this city all favor it ; our board of trade on three different occasions passed reso- lutions urging our Senators and Representatives in Congress to use their influence to secure said change, and the largest and most prominent brewers in our country have lately petitioned Congress in favor of it. The Secretary of the Treasury and the custom-house officers alon g our frontier ask for its passage, knowing full well that it will not diminish the revenue of our country, but, on the contrary, would increase the rev- enue by preventing undervaluation and fraud, such as has been perpe- trated during the last five years. In this connection we append an extract of report made by B. H. Hinds, special agent Treasury Department, Washington, D. C., March 15, 1881. In Canada there is a malt tax, and every malt-house is a bonded ware- house. It appears that, under some regulation of the inland revenue authorities, the manufacturer is allowed to withdraw for consumption 2 % per cent, more than the quantity on which he pays excise duty. On so flimsy a pretext as this have the Canadian shippers for years been claiming and receiving discounts of per cent, from the total amounts of their invoices at the various frontier ports. In the United States such a discount is entirely unknown, so far as I c&n learn, except in New York city ; and I am informed by American maltsters that, on account of this discount from regular prices at New York, malt is always quoted and sold in that market about 2J per cent, in advance of other markets ; so that even there the allowance is merely nominal, and the purchaser, iu fact, receives no benefit from such local custom. The impropriety, therefore, of allowing it on entries made by foreign shipers is obvious, since the American purchaser does not receive the benefit of this discount. From January 1 to September 30, 1880, there were imported into the various frontier ports the following quantities of malt, which were entered and paid duties at the prices and with the allowances indicated. In these tables I have reduced all importations to the American bushel of 34 pounds, and varied the invoice prices to conform to such standard. I have also, for convenience, in cases where the discount of 2 J per cent, has been made on the quantity, reduced such allowance to bushels and taken the value of the amount so deducted at the invoice prices: Port. Bushels entered. Dutiable value. Value, less 2\ per cent, commission. Average invoice price. Deduction for dust. Amount of allow- ance for dust. Port Huron 77, 560 $57, 985 $56, 571 Cents. 72.9 Per cent. 2h $1, 515 05 Detroit 34, 284 58, 500 25, 710 44, 627 25, 084 43, 541 73. 1 N one. Buifalo 74.5 2J 346 00 Niagara 576, 433 443, 511 432, 699 74.5 2h 10, 549 87 Oswego 29, 435 21, 346 20, 820 69.0 2* 597 00 Cape Vincent 27, 611 18, 777 18, 325 66.4 2i 186 00 Oswegatohie 16, 597 12, 853 3, 758 5, 078 12, 540 3, 676 4, 958 75. 5 None. Champlain 4, 698 6, 246 78.2 None. 2| Vermont 80.0 123 95 831, 364 618, 214 13, 317 87 General average price, 74.36 cents per bushel of 34 pounds. 774 TARIFF COMMISSION. [JOHN B. MANNING. I come now to the question of what was the true market value of the malt imported, as per foregoing table, taking into consideration the condi- tion of the Canadian barley market during the season of 1879-’80. 1 am informed by parties who were large purchasers of Canadian barley dur- ing the fall and winter of 1879 and the spring of 1880 that the average price of No. 2 Toronto did not, during those months, vary much from 65 cents per bushel. I should here state that all malt imported into this country from Can- ada, so far as I have been able to learn, is consigned by the Canadian manufacturer and owner either to a railroad broker for the purpose of entry, or to the party to whom it has been sold. It is universally sold by sample, at an agreed price delivered in this country; and the pre- tense that there are recognized grades in Canadian malt, as most of the invoices would seem to imply from the statement that a particular lot is No. 2 or No. 1, is not warranted by the facts. The largest brewers in Milwaukee, who purchase large quantities of the malt, inform me that they always buy by sample, and know noth- ing about grades in either American or Canadian malt. I have to state that in October last one of the largest maltsters in Toronto informed me that his prices for malt had been during the sea- son 90 cents per bushel of 36 pounds, which was as low as he could af- ford to sell it. In the testimony taken before the consuls in Canada it was shown that during the spring and summer of 1880, while shippers to the United States were invoicing their malt at from 70 to 80 cents per Canadian bushel, these witnesses, who were brewers, were paying for the same quality of malt from 90 to 95 cents per bushel, exclusive of the inland tax. These several kinds of evidence, coming as they do from such various and independent sources, concurring and corroborating each other in such an unmistakable manner, point irresistibly to the conclusion that a bushel of malt is fairly worth about 25 cents more than a bushel of the barley from which it is made. It will therefore be seen that the esti- mate submitted by me allows that the small Canadian manufacturer can produce malt nearly 3 cents per bushel cheaper than the largest and best-equipped American establishments, and even then the market value of the malt is shown to be from 21.9 cents to 25.3 cents in advance of the average cost of the barley, according as we estimate the manufact- urer’s profit at 10 or 15 per cent. Applying these calculations to the importations from January 1 to September 30, 1880, and reducing the price from 90 cents for 36 pounds to 85 cents, to conform to the American bushel of 34 pounds, we find that while the actual market value was 85 cents, the average invoice price, as shown by table, was only 74.3 cents, requiring an advance of more than 14 per cent, to make the true market value. It is true that some shipments were not undervalued to this extent ; but, on the other hand, many must have been invoiced from 20 to 30 per cent, below their true market value, and I have therefore taken the average percentage. As the value of the importations at the average price per bushel is $618,214, and as this was 14 per cent, less than the true aggregate value, or only 86 per cent, of such correct value, it follows that the full value of these importations must have been $718,853, and that the difference between these amounts, which is $100,639, escaped the payment of the 20 per cent. duty. I became convinced during the autumn of last year that large and JOHN B. MANNING.] MALT. 775 systematic undervaluations were being practiced by the shippers of malt, and I therefore ascertained, in a few cases, the prices at which it had been delivered in this country and the expenses attending the ship- ment. By comparing these with the invoice prices, the percentage of the undervaluation in each shipment could be approximately ascertained. I will submit a few instances by way of illustration : James Slater, of London, during the early winter and spring, shipped some 60,000 bushels to the Best and Schlitz Brewing Companies at Mil- waukee at prices varying from $1.10 to $1.05, and at the close of the season, in August, he disposed of the remainder of the stock a*t $1. He invoiced this at an average of 75-J cents per American bushel, with 2J per cent, discount, which brings it to 73.3 cents. The cost of trans- portation I found to be seven cents per bushel, which, with duty at 20 per cent, on 73.3 cents, would be 21.92 cents. This, added to the invoice price, should, in an honest importation, be very nearly the selling price delivered. It amounts, however, to only 95.2 cents, while the selling price averaged $1.05. J. McMillan shipped in May, 1880, 3,500 bushels from Kingston to the Best Brewing Company of Milwaukee, invoiced at 66^ cents per American bushel. The shipping expenses on this lot were probably 1 cent per bushel more than on Slater’s ; so that if his invoice price was a correct one, and included his profit, he could afford to deliver it for about 88 cents. I learned at the brewery, however, that they paid him $1.22J cents for the whole lot, and that it was an extraordinarily fine lot of malt, made from Bay of Quinte barley, which was worth at least 10 cents per bushel more than Toronto barley. I was informed in Buffalo that one of the Toronto shippers, William D. Matthews & Co., furnished, under contract, 125,000 bushels of malt during the season of 1879-’80 to Peter Doelger, a brewer in New York city, at an average of $1.18. Matthews’s entries are made at various ports at the rate of about 73.3 cents for the bushel of 34 pounds, includ- ing discounts, and as the expense of shipping cannot exceed 10 cents per bushel, it is evident that the malt is greatly undervalued on the in- voices. There is too sharp a competition among manufacturers of this article to justify the presumption that any unusual advance over regular market rates was obtained in any of these transactions, and the conclusion therefore is that the government was defrauded out of a very large amount of duties by means of these undervaluations. I have already stated that all Canadian malt imported into this coun- try, so far as I can learn, is consigned by the shipper or manufacturer at a stipulated price delivered to the purchaser. In this respect it bears a close resemblance to consignments made by European manufacturers to their American agents, and it has been found that the temptation to undervalue such goods, being an ad valorem rate of duty, is too strong to be resisted by a large majority of consignors. The fact that these shippers from Canada and the continent of Europe are not required to make oath to the correctness of their invoices before any magistrate having local jurisdiction seems to offer a still further in- ducement to fraud, since the only oath taken during the course of the importation is by an agent, to whom the goods have been consigned for the purpose of entry, and whose action is, therefore, of the most perfunctory character. It is true that some of the consuls make a pretense of administering oaths as to the correctness of the shipper’s declaration when they certify 776 TARIFF COMMISSION. [JOHN B. MANNING. invoices, but as no record of such oath appears on the invoice or else- where, and as an oath taken before a United States consul cannot be recognized in the courts of Canada as a basis for a prosecution for perjury, it does not clearly appear for what purpose this ceremony is performed. I have in several instances, both at consulates and custom-houses, found invoices and entries of malt and barley made on the same day at the same price. B. H. HINDS, Special Agent of the Treasury Department , Washington , D. G. March 15, 1881. The importation of malt in 1875 was 141,487 bushels ; 1876, 286,930; 1877, 314,139; 1878, 552,656; 1879, 537,995; 1880, 1,023,447; 1881, I, 128,089. The consumption of malt last year in the United States was about 36,000,000 bushels. Such being the facts, we leave you to judge how many years, ac- cording to the above rates of increase within the past six years — from 144,478 bushels in 1875 to 1,128,689 bushels in 1881 — it will be before our entire maltiug interest is destroyed or forced to locate in Canada, in case this evil is not remedied. By changing the duty to 25 cents per bushel specific undervaluation and fraud will be prevented and American revenue will be increased, American industries will be fostered and benefited, and American labor and capital will be protected. Buffalo, August 30, 1882. John B. Manning, Maltster. White & Crafts, Maltsters. Schaefer Brothers, Maltsters. Daniels & Polly, Maltsters. Solomon Scheu, Maltster. Charles G. Curtiss, Maltster. Frank A. Sears, Maltster. Thomas Clark, Maltster. Fischer Bros. & Co., Maltsters. McLeish Bros., Maltsters. Edwin Gilbert, Maltster. Henry Diehl, Maltster. Joel Wheeler & Co., Maltsters. C. G. & J. S. Voltz, Maltsters. John Kam, Maltster. A. M. Marsh, Maltster. J. O. Meyer, Maltster. Th. Kleinschmidt, Maltster. Peter Lehr, Maltster. A. McPherson & Co., Maltsters. Meidenbauer & Co., Maltsters. Chas. Schaeffer, Maltster. John M. Weigand, Maltster. Jacob Weppner, Maltster. Tuthill & Berriman, Maltsters. Albert Zeegele, Brewer. Jos. L. Haberstro, Brewer. Gerhard Lang, Brewer. J. Schuessler, Brewer. George Rochevot, Brewer. F. X. Kaltenbach, Brewer. Charles Gerber, Brewer. Jacob Scheu, Brewer. W. W. Sloan, Brewer. Geo. Boos, Brewer. A. Gieman, Brewer. David Haas, Brewer. Magnus Beck, Brewer. Buffalo Co-operative Brew- ing Co. F. Diskel, Brewer. M. Heinold, Brewer. Jost Brewing Co. E. Schleucher, Brewer. Moffat & Service, Brewers. John M. Luippold, Brewer. Julius Binz, Brewer. Alois Schaeffer, Brewer. J. F. Schanzlin, Brewer. Philip Schneider, Brewer. John Schuyler, Brewer. Wm. Voetsch, Brewer. Christian Weyand, Brewer. John Karn, Brewer. J. F. Kuhn, Brewer. JO UN B. MANNING.] MALT. 777 I remember reading a report of one of the meetings of this Commis- sion held at Long Branch, in which it was stated that the question was asked of the maltsters who appeared before you there whether any change in the duty on malt would not enhance the cost of the beer to the consumer and be an additional burden upon the brewer. I think we have answered this question so fully in the statement we have made that there is nothing left to be said, and that the figures we have sub- mitted will establish the truth of our assertions. 778 TARIFF COMMISSION. [PIERCE & ROBERTSON. PIERCE & ROBERTSON. Buffalo, N. Y., August 30, 1880. The following communication from Messrs. J. H. Pierce & Robert- son, importers of earthenware, Boston, Mass., was read and ordered printed : To the Board of Tariff Commissioners : Gentlemen : In view of the consideration now being given by your honorable body to the subject of the tariff on earthenware, and the fact that it has been claimed by the advocates of an increase in the rate on that class of goods that they arenow being sold at less rates than be- fore the war, under a tariff of 24 per cent., we beg to state that an ex- amination into the matter shows that the cost of those classes of the goods that are used by the great mass of the community is now at least fifteen or twenty per cent, higher than it was in 1859 and 1860. We therefore believe that a reduction of the rate of duty to 25 per cent, is highly important as a measure of relief to the public, of far greater proportions than any detriment which could thereby be caused to the interests of any particular class or locality. The writer having succeeded to a business in this line of goods es- tablished by his father in 1827, and having himself been actively and personally engaged in it for twenty-five years, we feel that we may fairly claim a practical knowledge of the subject, as well as facilities for mak- ing a comparison of prices at the periods under discussion. Very respectfully, yours, J. H. Pierce & Robertson. Boston, Mass., August 18, 1882. WM. C. J. HALL.] WORSTED GOODS. 779 WILLIAM C. J. HALL. Buffalo, K Y. } August 30, 1882. Mr. Will am. 0. J. Hall, of Jamestown, H. Y., manufacturer of worsted dress goods, made the following statement: I represent an industry which may be considered a peculiar one, classed under the head of the worsted dress-goods industry. My own firm, and the Broi'dhead Worsted Mills, of Jamestown, have an invest- ment of about half a million dollars in the business, and employ di- rectly about 700 people, indirectly giving employment to a large num- ber of others. We are particularly affected by proposed changes in the tariff in this way : There is a demand for goods manufactured after French rather than English modes at present. That involves a change in our machinery. If it is though c wise to remove the present tariff on these goods, it is certainly a very critical moment in the history of our trade to do it. Without the protection of the tariff our industry would be entirely wiped out of existence. Our business is a comparatively new one, the oldest mill not having been in operation more than ten years, and, of course, we are now struggling with obstacles incident to the transferring of an enterprise from a foreign country to our own. If England required protection for one hundred and seventy -five years to develop its manufactures, we certainly need protection for a few years to enable us to manufacture these goods, if it is the wish of the govern- ment to develop this class of manufactures. By the President : Question. You say that a change in the process of manufacture has taken place; what change do you refer to? — Answer. It is a change from the manufacture of what may be called a hard, stiff class of goods with a luster, to goods made entirely without luster, and of a thin, soft ma- terial. Q. Is not that a change which is going on all over the world, in England and everywhere? — A. Yes, sir; but the English are somewhat- in advance of us in this respect. Q. What kind of wool are these hard goods made from ? — A. All luster goods are made from Scotch wools, Lincolnshires, and the Eng- lish blooded wools; wools derived from the merino breeds. Q. Hoes it require much more labor and expense to manufacture this new class of goods ? — A. Yes, sir ; considerably more. Q. Is not the manulacture of these soft merino goods a very large in- dustry in France ? — A. Yes, sir; and it has been for a long period. Q. Are these staple goods; that is, have they been imported regularly from year to year since they were first made? — A. Yes, sir. Q. Have you the raw material in this country from which to manu- facture these goods ? — A. Yes, sir ; it is found here ; that is to say, the country is capable of growing it ; but the farmers need the encourage- ment of manufacture to lead them into the growing of it. Q. Is it a kind of wool that can be grown here more profitably than any other ? — A. It can be grown in larger flocks than any other. This country is better adapted to the growth of it. Q. Have you ever seen any of the Virginia wools from the Pan Han- dle? — A. Yes, sir. 780 TARIFF COMMISSION. [WM. C. J. HALL. Q. Can you state anything of the value of those wools'? — A. Yes, sir; they are of the kind suitable to this manufacture; and the same may be said of the wools brought from contiguous parts of Ohio, on the other side of the Ohio River. Our sources of supply lie in that direction. By Commissioner Boteler : Q. Do you know of any better wools in this country than those grown in the Pan Handle region of Pennsylvania? — A. I could hardly say. We get small lots of better wools ; but when we come to large quan- tities we do not find them any better. By the President : Q. I suppose you are aware that there are several establishments in France, employing as many as 10,000 hands, engaged in this manufact- ure? — A. I know that there are large establishments there, but I could not state the number of hands employed. Q. Is not this a class of goods in which there is less change on ac- count of the fashions; are they not staple and permanent in their char- acter? — A. Yes, sir; they are staple goods. We make goods of a dif- ferent character also, where the styles frequently change. If w r e could have a sufficient protection on these goods there would spring up a large manufacture of them; or if we knew what the policy of the govern- ment was going to be, so that we could depend upon a return for our outlay, we should feel more like investing large sums of money in the business, and not be acting in the dark. By Commissioner Underwood : Q. What is the present rate of duty on these goods ? — A. The general duty is, first, for goods valued under 20 cents a yard, 6 cents per square yard and 35 per cent, ad valorem ; for goods valued higher, 8 cents per square yard and 40 per cent, ad valorem, and goods weighing 4 ounces or over, per square yard, 50 cents per pound and 35 per cent, ad valorem, I believe. By the President : Q. Is it not important that the duty, whatever it may be, should be stable and not fluctuating ; is that not more important to you than the rate of duty itself? — A. Yes, sir; far more so; that is the great point in the matter. It is this uncertainty that is damaging our trade so much. By Commissioner Underwood : Q. If the present rate of duty were simplified and properly classified, would that be a sufficient protection to enable the American manufact- urer to compete with the foreign manufacturer ? — A. Yes, sir ; but it would be no more than sufficient ; it would not give him a chance for the rapid accumulation of a surplus. The finer grades of cloth need more protection, because the question of labor comes in there. By Commissioner McMahon : Q. What is the average protection which you have at the rates you have named; is it equal to 75 per cent.? — A. I should hardly think it was as much as that. Q. Is it over 70 percent. ? — A. I could not say. By the President : Q. Is it practically more than 35 per cent? — A. Yes, sir; it is, of course. We suffer under this ad valorem duty by reason of undervalu- . WORSTED GOODS. WM. C. J. HALL.] 781 ations. That affects all the manufacturers throughout the United States. By Commissioner McMahon : Q. Is it a difficult matter to decide what the value of the article you manufacture is 1 ? — A. Yes, sir; I have often deceived men who have made these goods by changing the tickets attached to them, and they could not tell withiu five cents a yard the actual value ; which shows that an appraiser is very likely to be misled. Q. What was the value of the article you refer to per yard ? — A. I am referring to goods worth from 50 to 75 cents a yard. The appraiser himself is liable to be misled, even if he is a skilled man in the busi- ness. Q. What specific rate of duty would you recommend ? — A. That is a question I should like to have time to consider and give a written an- swer to. I will submit a written statement in regard to that matter. 782 TARIFF COMMISSION. [JASPER S. YOUNGS. JASPEE S. YOUNGS. Buffalo, N. Y., August 30, 1882. Mr. Jasper S. Youngs, of Buffalo, secretary of the Williams ville Quicklime Company, addressed the Commission as follows : Our firm is interested in the manufacture and sale of quicklime, an article which you may say is one of local interest; but we have compe- tition from Canada to such an extent that we cannot manufacture our goods and receive enough from their sale to pay us for their cost. There are several reasons for this. One reason is, labor is cheaper in Canada, and wood can be procured there at a lower rate. Besides, the taxes we pay in this country are greatly in excess of those paid in conducting the same business in Canada. Our quarries are assessed at from $1,000 to $1,200 an acre here, while in Canada the land can be bought for from $75 to $100 an acre. Therefore we ask for a reasonable rate of duty which will protect us in our business. It is a lo3al business almost en- tirely. Our trade does not extend over 100 miles from Buffalo, and we ship our goods within that radius. This is an article manufactured largely for home consumption, and not for transportation to any great distance, and we are obliged to come in direct competition with lime which is brought over from Canada. I think we should have a specific duty of about 25 cents a barrel on our lime, and $5 per cord on lime- stone to enable us to come into the market even-handed with the Cana- dian lime. By Commissioner Ambler: Question. What is your lime worth a barrel here? — Answer. We are contracting this season to deliver lime for 80 cents a barrel of 240 pounds. Q. You now have a protection of 10 per cent.? — A. Yes, sir; which amounts to about 5 cents a barrel, as I understand from the custom- house officers. By Commissioner McMahon: Q. Lime is worth 50 cents a barrel in Canada as against 80 cents here; is that your statement? — A. I do not know what they rate it at there. I understand the duties and costs connected with it amount to about 5 cents a barrel. Q. How much of it is imported from Canada? — A. I could not say. Our business has fallen off very considerably. In 1873 and 1874 we handled about 80,000 barrels; but the importations from Canada began at that time, and have been quite extensive, so that our business has run down to 30,000 barrels a year. This year we will probably manufatture 45,000 or 50,000 barrels. By Commissioner Boteler: Q. The prices which you have named are those charged for the article in bulk? — A. Yes, sir. We are paying $20 a hundred for second-hand barrels ; we could not afford to pack the lime in new barrels at the pres- ent price we receive for it. WILLIAM R. N0RCR0S8, J EARTHENWARE. 783 WILLIAM R. NORCROSS. Buffalo, K Y., August 30, 1882. Mr. William R. Norcross, of the firm of Norcross, Mellen & Co., of Boston, Mass., importers and dealers in earthenware, addressed the Commission as follows : Mr. Wright has gone into the subject of the tariff on pottery so exten- sively and has so exhausted the subject that I think it is hardly neces- sary for me to say much in addition. I have, however, made a few notes in regard to this general subject, from which I will briefly address the Commission. In June last the Hon. J. H. Brewer, manufacturer of earthenware, and United States Representative from the city of Trenton, H. J., gave his testimony before the Committee of Ways and Means on the existing tariff as applied to earthenware, which testimony is calculated to con- vey an erroneous impression to the minds of those who are not familiar with the facts ; and, inasmuch as he represents the sentiments of Tren- ton manufacturers (as far as we can learn), we propose to review the line of argument adopted by him on the occasion referred to, with the hope of bringing light out of the darkness in which he leaves the subject. Mr. Brewer represents protection to American manufacturers in 186G as follows: He takes the sum of $100, deducts English discounts, 20, 5, and 5, $27.80, leaving a net cost of $72.20. The duties on $72.20 is $28.90, which he simply calls protection without further comment, leaving us to infer that $28.90 represents protection on the sum of $100. But the actual protection, by his own showing, is 45 J per cent., because by the existing tariff laws we are required not only to add packages, charges, and commissions, but also to pay duties on these items: Say.... .... $100 00 English discounts, 20, 5, and 5 27 80 Net cost 72 20 Add packages, per cent, gross . 5 25 Add charges, 2f per cent, gross 2 62 Add 2 % per cent, commissions on $80.07 2 00 82 07 We use Mr. Brewer’s discounts, 20, 5, and 5, not recognizing them as correct, even in a year when the demand was an abnormal one. Forty per cent, duties is $32.80, or 45 J per cent, on net cost of goods in Staffordshire. Add to this amount the packages and charges, $7.87, and we have a protection of $40.67, equal to 56J per cent, on net cost of goods. Mr. Brewer also states that for the year 1882 the protection on $100 is reduced to the insignificant sum of $15.32. Say, one hundred dollars $100 00 Deduct English discounts, 57|, 5, and 5 61 63 38 37 Duties on $38.37 at 40 per cent, are $15.32. 784 TARIFF COMMISSION. [WILLIAM R. NORCROSS. Let us present this case as it now exists : Say, one hundred dollars $100 00 English discounts, 57£, 5, and 5 61 63 Net cost ' 38 37 Packages, 5£ per cent, gross 5 25 Charges, 2§ per cent, gross . 2 62 Commission on $46.24, 2£ per cent 1 13 47 37 Duties at 40 per cent, are $18.95, or 49J per cent. If we add pack- ages and charges, we have a protection of $26.82, equal to 70 per cent, on net cost of goods. We now beg leave to submit a statement of the cost and charges of a small invoice of white graniteware recently imported and passed through the custom-house by our firm : Gross amount of 23 crates white granite ware..... £372 7s. 9 d. Deduct 57-£, 5, and 5 229 11 0 Net amount in Staffordshire 142 16 9 =$695 11 Crates and straw, 17s 19 11 0 Charges, 8s. Qd 9 15 6 Certificate 15 0 172 18 3 = 841 48 Duties, 40 per cent 344 91 Insurance, 5£ per £, at £ per cent c 7 12 Freight and w harfage, at 10 per cent 90 09 Truckage and labor, at 1 per cent 23 00 Interest, &c 8 41 1,315 01 Actual cost of goods landed in Boston, $1,315.01; showing an excess of $619 over the original cost; equal to 92 per cent, advance on net cost of goods in Staffordshire, England. In some cases the difference is still greater, but we take this single instance, feeling assured it would be sufficient to satisfy you of the enormous tax we are subjecting our people to, in our efforts to protect home manufactures. You- are, no doubt, aware that earthenware (especially the lower grades) is largely consumed by the poorer classes, whose very existence, in a great meas- ure, depends on the protecting arm of the United States Government. It therefore seems to us highly proper that this class of goods should be put in the hands of the consumers at the lowest possible cost; and we would respectfully, but urgently, recommend a reduction of the pres- ent burdensome tax to 25 per cent. If earthenware does not rank as high as many other productions, it is nevertheless an article of house- hold necessity, and every housekeeper in the land is directly interested. By Commissioner Ambler: Question. Do I understand that the present rate of discount is 57 J, 5, and 5? — Answer. Yes, sir; that is the rate I have taken as represent- ing an ordinary crate of goods in this country. Q. What was the rate for the last three or four years before the war ? — A. I think it did not vary materially from these rates. I have not gone into the figures on those points. Q. Were you in business at that time? — A. Yes, sir; I have been in business ever since 1840. Q. You are not aware what the discounts were at that time? — A. I could not give you the figures. The paper which has been submitted WILLIAM R. N0RCR06S.1 EARTHENWARE. 785 by Mr. Wriglit covers the whole ground, and I did not deem it neces- sary to go into further details. Q. The reason I wanted your views upon the subject was, because of the great discrepancy in the statements that have been made to us. — A. My impression is that the discounts did not vary materially just prior to the war from those prevailing at the present day, except on some kinds of goods. Q. Are you able to tell us what the rates were about the time that we resumed specie payment? — A. The rates of discount, I think, were some- what less than at present; they had not recovered from the effects of the war. Q. You are not able to give us the discounts for any particular year? — A. No, sir. Q. What do you know about the increase of the price lists? — A. I know it to be a fact that the English price lists have been increased. Q. Are you able to tell us the relative price to the retail dealer be- fore the war and now? — A. I am not prepared to answer that question. Before I left home I made some figures upon that subject, and I am pre- pared to state here, with some degree of confidence, that goods at the present day are being sold at a higher price than they were in 1800 under the 24 per cent, tariff. I have a firm conviction that goods are being sold now to the consumer at a considerably higher price than they were prior to the war. Q. So that it would be your impression that the rate was somewhat higher now, or has been for the last three or four years than it was be- tween 1850 and 1860? — A. Yes, sir. Q. But that is a mere impression ; you are unable to give us any figures ? — A. Yes, sir. By the President : Q. Do you say the prices in Staffordshire are higher also ? — A. Yes, sir ; of course they are higher too. Q. Have you ever dealt in American pottery ? — A. Yes, sir ; to some extent. Q. What is the character of the American goods as compared with the English goods? — Y. They do not rank as high as those made in England ; they are not as reliable. The chief defect is in the u crazing,’ 7 as we call it. By Commissioner Ambler : Q. It has been stated to us that that defect had been overcome, and that the goods were now as free from crazing as English goods are. — A. I have heardthat statement made, and also have heard the state- ment made, by persons perfectly competent to pass judgment, that, owing to the peculiar character of the materials used here, that was almost an insurmountable objection to the American goods, and they doubted' whether the defect could ever be effectually overcome. I merely state that from hearsay, although it was told me by persons I think perfectly competent to express an intelligent opinion. By the President : Q. Your most important commercial transactions are in foreign goods ? — A. Yes, sir. H. Mis. 6 50 786 TARIFF COMMISSION. [WILLIAM WILSON. WILLIAM WILSON. Cleveland, Ohio, August 31, 1882. Mr. William Wilson, of Cleveland, representing the Wilson & Hughes Stone Company, addressed the Commission as follows : Gentlemen : I desire to make a very short statement in regard to our interest, which is that of producers of building stone and grindstones. The Cleveland stone companies desire that you shall recommend to Congress that the present duty on stone should remain as it is, viz, $1.50 per ton of 13 cubic feet, block stone, specific duty, and $2 per ton of 13 cubic feet on grindstones, specific duty. There are about 45,000 tons of grindstone manufactured in this part of Ohio, about 6,000 feet of building or block stone, and 100,000 feet of sawed stone. The amount of money paid per month to laborers is about $45,000. We ask a continuance of the present rate of duty, and we think it is just and equitable to all concerned. By the President : Question. What wages do you pay your hands ? — Answer. From $1.50 to $2.75 a day, according to the grade of the labor. Since Nova Scotia became attached to Canada our trade with Canada has been cut off by competition to the extent of $2 a ton, because that stone comes in duty free from Nova Scotia. Our building stone is used in Boston, Philadel- phia, New York, and other places; it is a pure sandstone. Q. Your competitor is Nova Scotia? — A. Yes, sir; in our Canadian trade. By Commissioner McMahon: Q. What is the price per ton asked for stone at the present time ? — A. The prices vary from $12 to $14 or $15 a ton at the quarries. Mr. L. Haldeman, of the Ohio Building and Grindstone Company, said: We prepare about 25,000 tons of the manufactured article of grind- stone, and from 400,000 to 500,000 cubic feet of building stone per an- num. I agree with the gentleman who has preceded me in everything he has said. I have no additional remarks to make except to say that free trade would result in a discrimination against tlm American pro- ducts and against the American laborer. The present rate of duty is $2 a ton, and the price of grindstone varies. The present price is $2 a ton. We sell about 2,000 tons of stone a year to Canada ; but the Ca- nadians come in competition with us in our Eastern and other trade with about 8,000 tons of their manufactured product. HERMAN FRASCH.] SODA ASH. 787 HERMAN FRASCH. Cleveland, Ohio, August 31, 1882. Mr. Herman Frasch, of the American Chemical Works, at Bay City, Mich., made the following statement : Our reason for coming before you is, that we feel we should receive a protection to our industry in the way of a duty on imported soda ash which will counterbalance the high wages we are paying in this coun- try for our labor. We have to employ in our business skilled labor- ers, and pay them much higher salaries than they would receive for the same work in Europe. Although we have the same facilities here that manufacturers abroad have for the production of our goods, yet, as far as the price of labor is concerned, we are at a disadvantage. We have to pay five or six times the price here that the same labor can be ob- tained for in Europe. Our facilities in other respects are about the same. Coal is a little higher here, but salt we get at about the same price as abroad. We have to use brine, as we have no rock salt, and brine contains impurities which makes our process somewhat more ex- pensive than it is abroad. This process that we are working under is what is called the “ ammonia process,” where no sulphuric acid is em- ployed. Lime, ammonia, coal, and brine are the only materials that we consume in our manufacture. By the President : Question. Do you think it is possible, under a wise protection, to ex- tend this manufacture so that all the soda ash used in this country can be produced here'? — Answer. That is our ambition. Our works at present do not contain more than one-tenth of the capacity that we hope in time to build up. We do not want to experiment on too large a scale, and have gone into the business in a moderate way at first. We want to increase the product of our manufacture, and with enlarged facili- ties we can easily manufacture the whole product that the country re- quires. We have the necessary materials to enable us to do it. For the last few years we have expended a great deal of money in making necessary experiments. In England, France, and Germany they use rock salt, which contaius but very small quantities of the earthy chlo- rides which have to be removed to make a good salt — chloride of mag- nesium and chloride of calcium. As we have no rock salt in this coun- try we have to use brine, which contains other impurities. By Commissioner Garland : Q. Is this process of which you speak one peculiar to your own estab- lishment? — A. Yes, sir; it is one which we have reached by experiment. Q. You have the monopoly of it, then? — A. Yes, sir; as far as this particular process is concerned ; but the ammonia process, as such, is carried on in two factories in Europe. On account of our having to use brine instead of rock salt, we had to make some changes in the pro- cess in this country. The ammonia process is not a monopoly. Q. No one but yourselves can manufacture under your process ? — A. No, sir; but there are other forms of the ammonia process which can be used by any one. 788 TARIFF COMMISSION. [HERMAN FRASCH. By Commissioner Underwood: Q. Are you aware that there are large deposits of rock salt in Louis- ana and Texas? — A. Yes, sir; I am ; but it is necessary for us to locate our factory where we can get cheap supplies of coal and lime, and the high price of labor in the South makes it almost impossible for us to manu- facture there at a profit. We have an advantage in being located on the lakes where there is water communication, because we can get our coal and lime cheaply. It would be an advantage to us if we could use the rock salt which is found in Louisiana, but the other disadvantages of manufacturing there would counterbalance that advantage. Q. Are you satisfied with the present rate of duty ? — A. Yes, sir ; we are. Q. Do you think it is sufficient, or more than enough, to put the manufacturers here on the same plane with the manufacturers of Europe? — A. It does not give us any advantage, and we are not really on an equal footing with them ; but we are satisfied with the duty as it is, although an increase would be very welcome to us on account of the high prices which we have to pay for labor. We have to employ super- intendents and chemists at veiy high salaries, while abroad such ser- vices can be bad for one quarter of what we pay. That is an item in regard to wliich Europeans have a great advantage over us. I suppose the time will come when we will be able to dispense with any protec- tion ; but for the present we think that we ought to receive a fair rate of protection. By the President : Q. It has been stated to us that the European manufacturer has a very great advantage in his business where the employment of skilled chemical labor is required. — A. Yes, sir. Abroad, in Germany and France, a great many young men have adopted chemistry as a profes- sion, and they are willing for a small sum to work in these factories where their chemical knowledge can be made available; in some cases they are willing to act as volunteers and work without salary for the sake of the experience they gain. This is not the case in this country, and we find great difficulty in obtaining persons who have the neces- sary skill to adapt them to our business. By Commissioner Oliver: Q. Is it not a fact that in many of the large manufacturing establish- ments in Germany there are as many chemists employed in the labora- tory as there are clerks in the office? — A. Yes, sir; that, is the fact to a very great extent. There is hardly a manufacturing establishment abroad that is not guided in its work by the advice of one or two ex- perienced chemists, while in this country such services are not deemed essential in many instances. L. H AVIIITE ] SUGAR OF MILK. 789 i L. H. WITTE. Cleveland Ohio, August 31, 1882. Mr. L. H. Witte, of Cleveland Ohio, addressed the Commission as follows : I desire to state that the article called sugar of milk or lactin (not to be confounded with ordinary sugar) is one that ought to be made in this country ; that it can and will be made under a protective tariff of, say, 20 cents per pound. The imports of this article (see Treasury De- partment Document No. 45, Bureau of Statistics, page 68) for year end- ing June, 1878, were $16,008; for the year ending June 30, 1879, $22,861; for the year ending June 30, 1880, $25,430; which, although small, shows an increase in the yearly consumption. It is largely used in the manufacture of pepsin, it being a necessary article to grind up the pepsin. It is also used for a variety of other purposes. The article imported is always of doubtful or uncertain qual- ity. In this country it can be made of best quality to a certainty that can always be depended upon. This is owing to small cheese factories in Europe, each producing a quality peculiar to the factory. In this country cheese factories are large. The article is made by clarifying the whey of a cheese factory by boil- ing it down to the crystallizing point. This apparently simple process requires skill that can be only obtained by much loss of time and money. After this skill is well acquired the article can be made at a small cost, so small that it can be exported to a large amount. In 1876 I was told by one of the firm of Roethlisberger & Gerber, importers of the article, at 144 Chambers street, New York, that the advancing price of this article was due not so much to the increasing demand as to the growing scarcity of fuel. I therefore conducted ex- periments, erected buildings, purchased apparatus, all at an expense of $8,000, and am about ready to commence the manufacture of the article. But here I am met by a discouraging decline in the price eqyivalent to 21 cents per pound already. In my opinion, with an import duty of 20 or 25 cents per pound, in the course of five or six years the necessity of importing the article will not only cease, but that the exports will amount to fully half of the foreign consumption, which is believed to be ten times the home con- sumption. By Commissioner Kenner : Question. What is this preparation which you speak of made from?— Answer. It is made by clarifying the whey of a cheese factory by bod- ing it down to the crystallizing point. Q. It is only used for mechanical purposes? — A. Yes, sir; it is not a medicine. The largest quantity is used for making pepsin. It is ground up with it, and makes it soft and not liable to cake. Q. It is soluble? — A. It is, in eight or ten parts of water. By Commissioner Garland: Q. Is it used in the adulteration of articles for medicinal use ? — A. 790 TARIFF COMMISSION. [L. H. WHITE. No, sir; it is too expensive lor that purpose. Its chief object is to mix with powders to keep them in a powdered state. By Commissioner Underwood: Q. Why do you call it sugar of milk? Is there any sugar in it? — A. No, sir; that was the name given to it some years ago, on the same principle that we speak of sugar of lead. If you make a strong solu- tion of it you can detect a little sweetness in the solution. JOSEPH D. WEEKS.] HOOP IKON. 791 # JOSEPH D. WEEKS. Cleveland, Ohio, August 31, 1882. Mr. Joseph D. Weeks, of Pittsburgh, Pa., addressed the Commis- sion as follows: Mr. President and Gentlemen of the Tariff Commission: On behalf of the hoop-iron manufacturers of the country we respectfully ask from you favorable action on the two propositions that we here- with submit relative to the duties on hoop iron. We ask — First. Such rates of duty on hoop, band, scroll, and other similar iron as shall be fair and equitable, shall bear a proper relation to the duties on other classes of iron, and afford sufficient protection to the labor and capital employed in their manufacture. Second. Such action as shall secure the collection of that rate of duty not only upon these irons in one of their forms, but upon all forms, and shall also prevent the importation of any real or pretended manufact- ure of these irons at the same or less rate of duty than that imposed on hoop iron, using the term u hoop iron’’ to include all these classes of iron. We submit for your consideration and ask the adoption of the follow- ing schedule of duties on hoop, band, scroll, and other similar iron: $ — . On all hoop, band, scroll, or other iron, without reference to length, and by whatever nai ^ called, 8 inches or less in width, not thinner than No. 10, wire gauge, If cents per pound; thinner than No. 10, wire gauge, and not thinner than No. 17, wire gauge, If cents per pound; thinner than No. 17, wire gauge, If cents per pound. These are virtually the present rates. The gauges and widths have been changed somewhat to suit the present conditions of manufacture, and to afford a better and more reasonable classiti cation. Less than these rates will not afford adequate protection, and should not be consid- ered. Few, if any, of the operations of iron-making require so much or so highly skilled labor as the manufacture of hoop iron, and in none is the disparity between the wages paid and the labor cost in this country and abroad greater. As showing this disparity in a few of the rates of wages paid the la- bor in hoop mills in this country and in England, we give the following table : Classes of labor. England. Pittsburgh. Puddling per ton.. Shingling do... Rolling in puddle mill do... Rolling and heating, 1 inch x No. 18, hoop do. . . Common labor per day.. $1 94 0 29 0 29 1 80 $0 56 to 0 72| $5 50 0 77 0 68| 4 80 $1 30 to 1 50 A comparison of these wages rates will show the necessity to labor of the protection afforded by the rates of duty named above, if labor is to continue to receive the wages now paid. To show, however, the necessity of these rates of duty to all interested, we call your attention to the following statement of the average selling 792 TARIFF COMMISSION. [JOSEPH D. WEEKS. price of this iron in England, its cost laid down in this country, and a comparison of this with American-made iron: * Hoop iron. Cost in England. Average freight and expenses. Duty at 35 per cent. Cost laid down in any United States port. Present cost at American mills. Cost of English iron at r.ites of duty on hoop iron. Not thinner than $28 16 1 1 r $9 86 $40 52 $53 76 $58 66 No. 10. 1 Thinner than No. 29 38 1 ! 10 28 42 16 57 28 65 48 10, and not thin- ^ $2 oO s ner than No. 17. 1 1 i Thinner than No. 31 60 1 06 45 16 62 72 73 30 17. to 43 56 J ' i to 15 25 to 61 31 to 82 82 to 85 26 As to the collection of these duties. — Experience with the present tariff law has shown it to be of vital importance to the welfare and prosperity of this industry that the law contain a provision that will make it certain that the rates of duty prescribed shall be collected. The ingenuity displayed in the attempts, sometimes successful, at oth- ers not (more frequently successful than not,) under the present law, to import hoop iron at less rates of duty than provided, has been unceas- ing, and these attempts form a most remarkable chapter in the history of tariff decisions. A simple change of name has been by importers deemed sufficient to take hoop iron out of the category of. hoop iron and entitle it to admission at a lower rate of duty. Cutting it to speci- fied lengths, punching one or more holes in it, flaring or splaying it, stringing on or riveting buckles to it, painting it, adding stu^s or rivets ; all of these, sometimes singly and sometimes with two or more in com- bination, have been done to hoop iron, and then a lower rate of duty claimed. Certainly every piece of iron that can properly come under the classes of iron mentioned in this statement should pay the rate of duty provided. This is a proposition that admits of no discussion. . We claim that it is equally clear that all manufactures or articles made from these irons should not only pay the same but a higher rate of duty than the article from which they are made. This is the underly- ing principle of all tariff legislation. The nearer to crude or raw mate- rials, the less duty; the more advanced, the more labor that has been employed, the higher duty. This, it seems to us, is so evident that we need not argue it. We therefore ask that the following proviso be at- tached to the rates of duty above mentioned: Provided , That all articles, wh ther wholly or partially manufactured, made from the hoop, band, scroll, or other irons provided for in this section, or of which said hoop, band, scroll, or other iron shall be the material of chief value, shall pay one- quarter of one cent per pound more duty than that provided in this section for the iron from which they are made, or which shall be such material of chief value. The chief effect of this provision at the present time will be to prevent the importation of hoop iron for barrels and for baling purposes at less traes of duty than those imposed upon hoop iron. As the original use to which hoop iron was put was for hooping bar- rels, tubs, buckets, &c., it certainly should require no argument to show that iron for these purposes should pay the hoop-iron duty. If it has been somewhat manipulated to fit it for the barrel, it is more definitely HOOP IRON. JOSEPH D. WEEKS.] 793 hoop iron, and should pay above the ordinary hoop iron an additional duty to compensate for the extra labor. As to hoop iron for baling purposes. Strips of hoop iron, painted or not, sometimes with a buckle riveted and sometimes with it loosely at- tached, are used to a large extent, some 30,000 to 40,000 tons yearly, for baling wool, rags, old paper, excelsior, cotton, &c. These are some- times called cotton ties, baling ties, cotton-bale ties, strips for baling, &c. They were first made in quantities in this country in 1858, but did not come into general use until after the war. These u ties n were made under patents, and the trade controlled exclusively for years by one company — the American Cotton Tie Company — which prevented by purchase or suits at law any one from interfering with their monopoly, and most of the cotton ties used up to 1876 were furnished by this com- pany and were of foreign iron, the profits, we are credibly informed, being enormous. I am informed that the American Cotton Tie Com- pany made about $8,000,000 before their patent expired. By Commissioner Kenner : Question. In what length of time? — Answer. In about 'fourteen years, I think. In 1876, at great risk, some American manufacturers determined to begin their manufacture. Suits and injunctions failing to stop them, the price of ties fell at once from 6| cents per pound in 1875 to 5^ cents per pound in 1376. In 1877 more American ties were made, and the price fell to 4 cents, the Cotton Tie Company purchasing a portion of their. supply in this country. Here the price remained for two years, when* the Cotton Tie Company determined to drive out competition by using English-made ties, imported under Treasury decisions at 35 j)er cent, ad valorem, instead of at the hoop-iron duty of 1J cents, and it accordingly purchased in England ties enough to very nearly bale the whole cotton crop of 1881, and put them on the market at 3 cents a pound, a price which drove the American ties out of the market. The importation of these ties at 35 per cent, ad valorem we claim to be a clear evasion not only of the spirit but of the letter of the law, as they are only hoop iron used for baling purposes, and are no more en- titled to be admitted at less than hoop-iron duties than is hoop iron for any other purpose. It is to make this impossible that we ask the adop- tion of the above proviso. It is asserted that this duty is a hardship to the cotton planter. This we deny emphatically. The planter buys these ties at the price of iron and sells them at the price of cotton, and makes on them the difference between these two prices. It requires 11 pounds of ties to a bale of cotton. The crop for 1880 was 6,605,000 bales, which would require 72,655,000 pounds of ties. The average price of ties was 3.7 ; cents of cotton, 11.34 cents. This is a profit of, say, 7J, cents a pound, or $5,449,125 on the crop. It is certainly no hardship to ask, in view of this, that the duty on hoop iron be collected from these ties. If it is answered that these ties are regarded as tare, and reduce really the price of cotton, we deny it. No tare is deducted, and the cotton is worth more with the ties than without. They reduce the size of the bale, permit a large increase of weight per bale, increase the carrying capacity of vessels, and reduce the cost of carriage. With them insurance can be effected at a veiy much less rate than it could be with the rope tie. In a word, baled with this hoop iron the cotton sells for more than it would baled with any of the other devices known, 794 TARIFF COMMISSION. [JOSEPH D. WEEKS. and it is no hardship to ask that an article on which there is a profit of over 200 per cent, should pay the duty asked above. As showing the present and proposed rates of duty, we submit the following: PRESENT RATES OF DUTY. [Note. — T he numbering of the paragraphs is that of the “Indexed Tariff,” published by the Treasury Department.] 78. All band, hoop, and scroll iron, from one-half to six inches in width, not thin- ner than one-eighth of an inch : one and one-fourth cents per pound. 79. All band, hoop, and scroll iron, from one-half to six inches wide, under one- eighth of an inch in thickness, and not thinner than No. 20, wire gauge: one and one-half cents per pound. 80. All band, hoop, and scroll iron thin- ner than No. 20, wire gauge : one and three- fourths cents per pound. NOT OTHERWISE PROVIDED CLAUSE. 146. Manufactures, articles, vessels, and wares not otherwise provided for, of brass, iron, lead, pewter, and tin, or other metal f except gold, silver, platina, copper, and steel), or of which either of these metals shall be the component rqaterial of chief value : thirty-five per centum ad valorem. By Commissioner Underwood : Q. You say m your statement that u It is asserted that this duty is a hardship to the cotton planter.” Is not that the universal complaint in the country where cotton is raised? — A. I have no doubt it is. Q. Then you do not think the cotton planter has sufficient intelligence to understand his interests? — A. That does not necessarily follow. I think the cotton planter may understand that it is his interest to get it for nothing, if he can, and then sell it as high as he can. Q. You understand that the cotton planter buys these ties at the price of iron and sells them at the price of cotton? — A. Yes, sir. Q. Did you ever sell any cotton yourself? — A. No, sir. Q. Do you not know that the cotton, when it reaches the Liverpool and Manchester markets, is stripped entirely naked before it is sold ? — A. That may be. 1 understand there is an allowance of G per cent, for tare made in Liverpool on the cotton, and that is largely the cost of the bagging. Q. And they do not include the iron at all. — A. That may be true, but my point is this : That with the cotton ties on, the bale of cotton is worth more than it is with them off*. A great deal of cotton is carried from different ports of this country, and the weight of the bale can be increased by the use of the iron cotton-tie — increased from .150 to 450 pounds of cotton to the bale, with a consequent reduction in the cost of freight by reason of the use of that tie, and the bale is worth more than it would be with the old rope tie, which would not allow of so many bales of cotton to the cargo. Q. Then you deny that cotton can be compressed with a rope instead of an iron tie? — A. No, sir; I do not. But I deny that with the rope tie the cotton can be put in as small a compass as with the iron tie. PROPOSED RATES OF DUTY. $ — . On all hoop, band, scroll, or other iron, without reference to length, and by whatever name called, eight inches or less in width, not thinner than No. 10, wire gauge : one cent and one-fourth per pound ; thinner than No. 10, wire gauge, and not thinner than No. 17, wire gauge : one cent and one-half per pound ; thinner than No. 17, wire gauge: one cent and three-fourths per pound: Provided , That all articles, whether wholly or partially manufactured, made from the hoop, band, scroll, or other irons provided for in this section, or of which said hoop, band, scroll, or other iron shall be the material of chief value, shall pay oue-quarter of one cent per pound more duty than that provided in this section for the iron from which they are made, or which shall be such material of chief value. JOSEPH D. WEEKS.] HOOP IRON. 795 Q. Have you any facts to prove that? — A. It is simply the statement made to me by parties living in the South. Commmissioner Underwood. I live in the South, and have been ac- quainted with the process of cultivating and baling cotton ever since the time they baled it in the old round bale. 1 have seen it in all its forms, and I am here to state that cotton can be compressed as well with a cotton rope as with an iron tie. The Witness. I do not deny that it can be compressed as well. My point is that you can compress the bale closer and put more cotton into the same space with an iron tie than with a rope tie. Another state- ment I wish to make is, that there has been considerable inquiry as to whether these ties could not be made of steel, in order that the compres- sion could be carried to a still greater extent. Q. Have you ever been connected with the manufacture of cotton? — A. Yes, sir; I was in Lowell, Mass., some years ago. Q. That was before they compressed cotton in this way ? — A. Yes, sir ; it was before they used the iron tie. Q. I suppose you are aware that the compressing of cotton injures the staple when it is compressed to a certain degree ; it sells for a lower price in consequence of the very hard compression it has received than it otherwise would. But I deny th^t you cannot compress with a rope a given number of pounds of cotton as well as with an iron tie, and put the cotton in the same space, using a cotton rope instead of an iron tie? — A. That is not according to the representations made to the iron manu- facturers by parties who use the ties. Commissioner Underwood. I have raised cotton, and have had it compr.essed and packed in every form, and 1 think I understand some- thing about it. It is for the benefit, then, of the cotton planter that you insist upon this duty? The Witness. No, sir; we insist that when the cotton planter gets this increased amount for his cotton, he ought not to find fault with us about the duty. Q. Can you produce a solitary case where the cotton planter ever got any pay for his ties in England ? — A. The cotton planter does not sell his cotton in England ; he sells it to his factor. Commissioner Underwood. Of course there is a middleman here who buys cotton for merchants in France, England, or Germany, and who fixes the price with reference to what he can get for it abroad, or what he is authorized to give for it, and tare is deducted on all of it. Now, I want to know if your proposition is, that the cotton tie is sold by the cotton planter as cotton, and that he gets the same price for the tie that he does for the cotton ; in other words, if he pays 4 cents a pound for cotton ties, does he get 6 cents a pound for them and make a profit? — A. I mean to say that when that bale is weighed the cotton ties are weighed with it. The weight of the cotton ties on a bale is about 11 pounds, I believe, on the average, and w hen be sells that cotton he sells 11 pounds of iron ties and gets paid for it at the same price that he gets for his cotton. Thai is my proposition. Q. Your proposition is, that the man who sells the cotton here sells it without deducting for the tie, and that it is all weighed. But are you not aware that the price of cotton in this country is regulated by the price of cotton in Europe ? — A. Yes, sir. Q. If they buy the cotton in Europe and strip it naked when the cot- ton buyer here ships it, is there not an allowance made for the bagging and ties? — A. Yes, sir; there is an allowance of 6 percent. That is the statement I got from the Memphis Cotton Exchange. 796 TARIFF COMMISSION. [JOSEPH D. WEEKS. Commissioner Underwood. I am speaking of what I know. There are 110,000 bales of cotton sold annually in the little town in Georgia where I live, and we understand distinctly that the price of cotton there is fixed by the price of cotton in Europe, and that whenever we get the cotton to Europe it is stripped and the deduction is made for the bag- ging and ties both. We are not to be made to believe in our country that the cotton planter makes 6 cents a pound upon the cotton ties that he buys. The Witness. But we still insist that he does; that he would not get so much for his cotton without that tie as with it on, and if that tie enables him to get the cotton to market cheaper than he did formerly, then he gets the benefit of that. The old proposition is that the man who goes to market has to pay for getting there, and the cotton planter has to go to market, and if he reduces his cost of getting there by the use of the iron tie, even though thej T strip it off in England, then he gets the benefit of it. Why in the world do they insist on having iron ties? Commissioner Underwood. Because they are more convenient. The Witness. Our point is that if it is more convenient and reduces the cost of carriage, enabling the planter to go to market cheaper than before, he should not object to paying the duty that, we believe, the law has laid down that he should pay. Commissioner Underwood. There is where we disagree. I say he does not make anything. The Witness. All we ask is that the law shall be enforced; and for years it has not been enforced. Commissioner Underwood. On that point you are entirely correct; I want it enforced. The Witness. I do not see why a man who wants a piece of hoop iron to put around a bale of cotton should have it at a less rate of duty than the man who wants a piece of hoop iron to put around a barrel or a pump log. Why is the cotton planter of the South entitled to his cot- ton tie at a less rate of duty than the lumberman or the pump-maker, or the man in Kentucky who wants it to put around whisky barrels ? I do not see why the cotton iff anter is entitled to a less rate of duty than those men. Commissioner Underwood. I am not claiming any such thing as that. The Witness. I understand that Mr. Banlett, who appeared before the Commission, made such a claim. Commissioner Underwood. There are 0,000,000 bales of cotton raised in the Southern States ; cotton is a great agricultural interest there; and some of us believe that the agricultural interest of the coun- try is entitled to some consideration as well as the manufacturing in- terest. The Witness. We do not doubt that. Commissioner Underwood. Both of them ought to be properly and judiciously treated. It is my judgment that this great interest, which concerns about ten States of the Union, and is the great business in which they are engaged, ought not to be depressed by protective du- ties that are unnecessary. I am willing to put you precisely on an equal plane with all manufacturers of cotton ties in Europe ; I am will- ing to do that. But the whole South differs from you as to the point that we buy the tie at 4 cents a pound and sell it for 6 cents a pound. There is a different opinion throughout the whole South on that sub- ject. JOSEPH D. WEEKS.] HOOP IRON. 797 The Witness. I, of course, agree with you that the agricultural in- terest of this country should be protected, and I think it should be pro- tected very largely. I think the duty of 15 cents a bushel on potatoes is a protection, and that hay, corn, wheat, butter, cheese, and oats are all well protected. But let me ask you this question: If you bale cot- ton with a rope tie, can you get insurance on it"? Commissioner Underwood. Yes, we can. The Witness. The associations of underwriters in New Orleans do not insure cotton baled with the rope tie. Commissioner Underwood. I do not know about that. I do not believe there is a particle of difference ; there is no reason why there should be. A bale of cotton is as easily set on fire when it is bound with an iron tie as when it is bound with a rope tie. The Witness. My understanding is that during a great fire at New Orleans, which occurred some time between 1860 and 1870, a large amount of cotton was destroyed. The cotton was baled with rope ties which burned off; the cotton was thrown out and the fire got at it. After that time the underwriters of Sew Orleans refused to insure cotton un- less it was baled with iron ties. Commissioner Underwood. I do not know anything about that. There is no reason, however, why the cotton tie would be more advan- tageous to us, while it necessarily enhances the price of cotton. There is no reason why it should intertere with the great principle of supply and demand. The Witness. These cotton ties add 11 pounds weight to the bale. We simply ask that the hoop iron duty be collected upon that, at what- ever rate the duty may be fixed. Commissioner Underwood. I am not discussing the question as to what amount of duty ought to be put on hoop iron ; I am challenging your statement that it is beneficial to the cotton planter, and that he derives a profit from the tie which he buys at 4 cents a pound and sells at 10 cents a pound. The Witness. The rate the past year has been 3 cents a pound. My statements are based on what I consider reliable information. I have reports here from large factors in the South. There is one thing more 1 desire to say. Hoop iron of course should relatively bear the same rate of duty as that imposed on other kinds of iron. Because of the demand of the South or any other part of the country it should not be brought in at a less rate of duty than the iron out of which it is made. That is the theory of all tariff laws. Before hoop iron is made it is first in the form of bar iron, varying in size according to the size of the hoop iron to be made from it. Whatever the duty on bar iron may be, there should be an additional duty on hoop iron to compensate for the additional labor in making it hoop iron. Its manufacture requires the most skilled and highest paid labor about a rolling-mill. By Commissioner Oliver : Q. I understand that what you desire is to have hoop iron put upon the same plane as the other manufactures of iron 1 — A. Yes, sir; that is it exactly. Q. Do you know of any other kind of imported manufactured iron except cotton ties which is rated at an ad valorem duty; are not all the duties on manufactured iron specific except on this article ? — A. Yes, sir; except where there are evasions of the law similar to this. 798 TARIFF COMMISSION. [JOSEPH D. WEEKS. Under the clause i( not otherwise provided for, 35 per cent, ad valorem” there is an immense amount of iron brought in. Q. But not in large items of 20,000 or 30,000 tons, are there? — A. No, sir; not of iron. Q. What is the lowest rate of duty imposed upon iron? — A. On finished iron, one cent a pound. Q. What is the rate at which this hoop iron is imported? — A. From 1J to 1J cents per pound. Bailroad iron pays a duty of 70 cents a hun- dred pounds. The average rate of duty is $14.41 for all sizes of hoop iron brought in under this section. Q. Are these cotton ties made abroad, in England, manufactured gen- erally by the importers ; 1 mean, the finished cotton ties? — A. They are made abroad by the importers and invoiced by them. Q. How are they put up? — A. At a uniform weight of 56 pounds to the bundle. Q. The point you make is that the bar iron out of which they are made is dutied at one cent, and hoop iron at 14 cents, while they are dutied at a little over half a cent? — A. Yes, sir; we want the duty fixed collected. By the President : Q. As I understand you, the present rates of duty, which you have stated, were intended to give you the protection you required? — A. That is what we understand. Q. But the present construction of the law is under a decision of the Treasury Department? — A. Yes, sir. Q. And that is what yon object to? — A. Yes, sir; we object to that. The case has been tried in the lower courts once or twice, but has not yet reached the Supreme Court of the United States. The same judge sitting in the court below in the same case has given two absolutely different charges to the jury, and the jury have given two absolutely different verdicts in regard to the matter. JOSEPH B. MEHIAM.] SODA ASH. 799 JOSEPH B. MERIAM. Cleveland, Ohio, August 31, 1882. Mr. Joseph B. Meriam, of Cleveland, Ohio, vice-president of the American Chemical Company, of Bay City, Mich., made the following statement : Gentlemen: We desire to call your attention to the fact that the American Chemical Company, incorporated, with a capital of $400,000, has been for the last two years constructing works for the manufacture of refined alkali or soda ash, and other kindred products derived from the salt wells of Michigan, by a process never before used in this country or elsewhere. The fact that 200,000 tons of soda ash alone were im- ported into this country annually promised us a large market in case we could successfully compete with these foreign goods both in quality and price. We were aware that foreign manufacturers were placing these goods in our market at cost or less than cost, and that the present tariff of £ of a cent per pound is the lowest known in our commercial history; yet we were hopeful and ambitious, by the aid of certain im- provements in applied science, to be successful in the competition. We felt safe in relying upon the continuance of the present rate of tariff, if not upon its increase. We anticipate still greater sacrifices on the part of our foreign competiors, in order to hold their market here and prevent the development of this industry upon this side of the Atlantic. A reasonable protective duty on this class of goods for a few years will give us such experience, we believe, as will enable us to supply our home market without protection. We have an abundance of the crude mate- rial, abundance of fuel, and our flowing tide of immigration will give us plenty of labor. A revolution in alkali manufacture is going on in Eu- rope, whereby the adoption of new and improved processes is rendering useless the extensive plant of very large and long-established factories. There is no reason why the manufacture may not be maintained as successfully here as there, if reasonable encouragement be given at first. There never has been a time in the history of our country so favorable for planting this industry here as now, when the old works are being either broken up or rebuilt. One is already being transplanted to this country and located at Syracuse, N. Y. Without entering upon any argument or going further into details, allow us to urge the importance of encouraging the manufacture of soda products in this country by continuing at least the present tariff, if not by increasing it. We do not feel, gentlemen, as if there was any necessity for asking any further protection than that now existing under the preseut law. We feel competent to meet foreign competition under the present rate of duty. Of course we would much rather have the duty advanced than decreased. Our business requires the investment of considerable capital, with the usual risk attending such investments; but we are hopeful of ultimate success. We have succeeded in making a merchantable prod- uct, and we are now only looking for further capacity to place our goods in sufficient quantities upon the market. We think that this is an important industry for the country, inasmuch as there is a very large home consumption, and we are confident that our process will be a sue- 800 TARIFF COMMISSION. [JOSEPH B. MERIAM. cessful one. Under the old process sulphuric acid was used, but under our process ammonia takes its place. By the President : Question. Has this country not an advantage over foreign countries in this manufacture, as regards the supply of raw material? — Answer. Yes, sir ; it has. Q. How do you get your ammonia? — A. That we can manufacture here. We have a process for manufacturing it more economically than has been done heretofore. We have equal facilities for manufacturing that article that any other country has. The business in undergoing a revolution on account of the introduction of the ammonia process in the place of the sulphuric acid process. Q. Have you any idea of the quantity of soda ash used in this country ? — A. I think the amount is- about 200,000 tons. Taking the weekly reports of importations at the custom-house, I judge that we import about 600 tons a day. By Commissioner Oliver : Q. Where does the supply come from ? — A. Largely from England ; almost exclusively. Our factory is the only one that manufactures soda ash in this country. By the President: Q. Soda ash was formerly manufactured here, was it not ? — A. Yes, sir; it was manufactured from cryolite by the Pennsylvania Salt Com- pany for a time; but it was not a successful manufacture. There have been several other attempts made to manufacture it here, but they have not succeeded. Ours is really the first factory that has succeeded iq making it successfully. C. A. GRASSELLI.] SULPHUR. 801 C. A. GBASSELLI. Cleveland, Ohio, August 31, 1882. Mr. C. A. Grasselli, of the firm of E. Grasselli & Sons, Cleveland, Ohio, appeared before the Commission, and was interrogated as follows: By the President : Question. Do you confirm the statement, in regard to sulphur, made by Mr. Daniel Myers, who preceded you ? — Answer. Yes, sir; I do. By Commissioner McMahon: Q. Do you import sulphur ? — A. Yes, sir ; we have been importing it for many years. Q. Have you imported this particular kind of ore of which Mr. Myers has spoken 1 ? — A. We do not import any sulphur ores. It is the sulphur that contains from 95 to 98 per cent, that we import. Q. Do you import that as crude sulphur? — A. Yes, sir; we do. Q. Is that sulphur afterwards refined here ? — A. No, sir ; that under- goes no refining here; it is refined in Sicily. Q. Then you import as crude sulphur a refined sulphur, do you ? — A. We import as crude sulphur an article that runs from 95 to 98 per cent. Q. I understand you to say that it is refined in Sicily? — A. Yes, sir; and it is imported in the form of blocks. It is similar to coal in appear- ance. It is refined in Sicily because they have not any sulphur in a native state of* that degree of purity. Q. You are aware that there is a duty of $10 per ton on refined sul- phur? — A. Yes, sir; on flour of sulphur. Q. And that crude sulphur is free of duty ? — A. Yes, sir. Q. Do you invoice this as crude sulphur? — A. We buy it as crude sulphur. Q. Do you enter it at the custom-house as crude sulphur ? — A. It pays no duty ; it enters free. Q. You describe it in your invoices, and in your entries at the custom- house, do you not? — A. It is sold in New York as best seconds and best thirds. By Commissioner Kenner : Q. But you say it is dug out of the earth with a purity of 20 per cent. ? — A. Yes, sir. Q. And you introduce it with a purity of from 95 to 98 per cent., and still call it crude ore? — A. Yes, sir; we buy it as such. Q. What do you mean by buying it? — A. We do not import it our- selves. By Commissioner McMahon : Q. You said when you began your statement that you did import it, and that you had imported it for years. — A. We buy it from brokers in New York. I did not understand the question. By Commissioner Kenner : Q. These parties who do import it sell it to you as crude sulphur of 95 to 98 per cent, purity ? — A. Yes, sir. Q. When 100 per cent, would be the absolute purity of the article ? — A. Yes, sir. Q. And you get within 2 per cent, of absolute purity, although it H. Mis. 6 51 802 TARIFF COMMISSION. [c. A. GRASSKLT.I. is dug out of the sulphur caves of Sicily with only a purity of about 20 per cent, ?• — A. Yes, sir. By Commissioner McMahon : Q. Have you always had the same belief about this being refined, and not crude ? — A. Yes, sir. Q. You have always considered it as refined ? — A. Yes, sir. Q. Then you did not some years ago join with the other parties in- terested in the trade in advocating the theory that this was crude sul- phur? — A. No, sir. Q. Do you know that the government did collect a duty on the article for some time ? — A. Yes, sir; there was a duty at one time of $6 per ton upon it. Q,. Do you know that it paid a duty of $10 a ton as refined sulphur ? — A. Yes, sir ; on refined sulphur, which is known as the floui of sulphur. But the duty on what is now entered as crude sulphur was $6 a ton. Q. I am aware of that ; but there was also a duty of $10 a ton on sulphur ? — A. Yes, sir. Q. Do you personally know whether there were ever any suits brought in regard to that duty? — A. I do not. GEORGE H. ELY.] LAKE SUPERIOR IRON ORE. 803 GEORGE H. ELY. Cleveland, Ohio, August 31 , 1882 . Mr. George H. Ely, of Cleveland, representing the Lake Superior iron-ore interest, addressed the Commission as follows: Gentlemen of the Tariff Commission : It affords us special gratification, as representatives of the Lake Superior iron-ore interest, to lay before you, here at Cleveland, some facts and considerations re- specting it. Cleveland fostered and promoted the early development of that region, and ever since has in large degree directed and controlled its production and trade. From our position on the lakes, and our relations to inland coal dis- tricts, this and our adjacent harbors are the entrepots and the distribu- ting points for the largest portion of the Lake Superior ore product. Here also, naturally, are the headquarters of several of the large ore corporations and sales agents. It is well, therefore, that the relations of this production and trade to importations of foreign ores should be considered here, where such relations are vital. At this moment, in advance of conference with the representatives of the other principal ore districts of the country, which we expect pres- ently to obtain, we defer discussion as to details respecting duties. All such representatives, however, stand upon the common ground of the necessity for such a rate, and such a form of laying it as will adequately and fully protect the capital and labor employed in the business. And this, not only in justice to that capital and that labor, but in the interest also of the iron manufactures of the country absolutely dependent upon it. The necessity for this and the justice of it will appear, we believe, from a fair consideration of the history and the existing condition of the business. It must be observed at the outset that, while many of the blast furnaces and mills of the country themselves mine a portion, at least, of the ore they consume in the immediate neighborhood of their plant, others, and a larger number, depend upon an ore supply from a distance, greater or less; an advantage being also gained by mixing the richer and purer ores, or ores of special chemical constituents, of one district with those of another of less value. Hence the mining and transportation of iron ore has become to a large extent a separate and an independent department of the iron trade of the country. The Lake Superior iron region is the farthest removed of any other from the great centers of manufacture; at the same time, it is the largest produ- cer of our most valuable ores. In its early history it lay in distant iso- lation, far to the northward of the great movement of population into the West. • To begin the development of that region at a time when our iron manufacturers were struggling against the ruinous competition of the foreign article, and when the world was iucredulous as to the real value of these deposits, required a courage and faith that thoroughly deserved reward. The difficulties encountered were enormous; years passed be- fore the business, including railroad and water transportation to market, could be put upon any r stable foundation. Shipments of ore began on 804 TARIFF COMMISSION. [GEORGE H. ELY. a small scale from Marquette in 1852, but the total quantity shipped in the ensuing five years was only 86,319 tons. From 1853 to 1857 Then, from 1857 to 1862 From 1862 to 1867 From 1867 to 1872 From 1872 to 1877 ...... From 1877 to 1881 Tons. 86, 319 346, 013 1, 064, 754 3, 288, 614 4, 983, 426 7, 873, 317 Total shipment 17, 642, 443 The very large increase during the last five years is mainly due to the development of the Menominee ore district, which began in 1877. Its shipments to the close of 1881 have been 1,705,067 tons. The total contribution of Lake Superior ore then to the iron trade of the country to the close of last year, produced by fifty-six different corporations, has been 17,642,443 tons, having a market value of $138,592,275; the product of 1882 will bring the grand aggregate up to 20,000,000 tons. These ores embrace a wide range of quality, and of adaptation to a great variety of special as well as general uses. While the product of some of the best mines yields 66 to 70 per cent, of iron, the average yield of ali may be estimated at 62 to 63 per cent. Of the total pig-iron manufacture of the United States in 1881 — 4,141,254 tons then — 35 per cent, was made from the 2,336,335 tons of ore sent from Lake Superior into the trade of the country in 1881. Allow us, gentlemen, to direct your attention to the means and acces- sories of this business, and to the capital and labor that are represented in the mining, moving by railroad to the lakes for shipment, vessel transportation through the lakes and rivers, and, finally, in the move- ment by rail from the lower-lake harbors to the furnaces, widely scat- tered through the Central and Western States, where it is reduced, this enormous product of industry in this single department of ore produc- tion. The capital employed in mining is estimated to be — In the Marquette district $33,000, 000 In the Menominee district 18, 000, 000 Total 51,000,000 Marquette district employs 9,000 men; Menominee district, 5,000 men; both mining districts support 50,000 people. There are three railroads leading from the mines to the ports of shipment, Marquette, Escanaba, and Saint Ignace. The Marquette, Houghton and Ontona- gon road, and the Chicago and Northwestern (Peninsular Division), have been in operation many years, with costly dock equipments at Marquette and Escanaba. The Detroit, Mackinaw and Marquette road has recently been put in operation to Saint Ignace. The capital now in use iu the ore business by the Marquette, Houghton and Ontonagon Railroad is $4,500,000 In the Chicago and Northwestern (Peninsular Division) 6, 000, 000 In the Detroit, Mackinaw and Marquette Railroad 2, 825, 000 13, 325, 000 The capital in the movement upon the lakes by vessels and steamers, on the basis of the ore production of 1881, is estimated at $6,000,000. Leaving out of view the capital of railroads employed in this business, leading inland from harbors on Lake Michigan, and also the expend- itures of the government on the Saint Mary’s River largely in this be- GEORGE H. ELY.] LAKE SUPERIOR IRON ORE. 805 half, we will add to the above results the ore business of four of the roads only leading inland to the furnaces from the harbors of Cleveland, Ashtabula, and Erie : The New York, Pennsylvania and Ohio Railroad uses capital inthisbusi ness $1,212,000 The Cleveland and Pittsburgh Railroad 2, 048, 000 The Ashtabula, Youngstown and Pittsburgh Railroad 1, 241, 002 The Erie and Pittsburgh Railroad 651, 237 5, 152, 839 RECAPITULATION. Mining $51, 000, 000 Railroad transportation above 13, 325, 000 Lake transportation 6, 000, 000 Railroad transportation below 5, 152, 839 75, 477, 839 Here, then, gentlemen, in various departments dependent upon each other, but organized to the single end of utilizing the mineral deposits of the Northwest for the necessities of American iron manufactures, is the vast aggregate of $75,477,839 of capital ; and it is permanently invested. Withdrawal of it in other directions is impossible. It will either live and prosper, or it will perish where it now is. It has reached its pres- ent magnitude only through slow accretions. The early seed was planted thirty years ago in a wilderness. It has come to fruitage at last, as in many another instance of material development on a grand scale, with the usual alternations of success and failure,, and with the usual con- comitants of individual loss and disaster. But what of the labor employed From the nature of the business, the mining and transportation of a product in which value is greatly disproportioned to the tonnage involved, the labor permanently em- ployed is proportionally larger. From the first tap of the drill and the first stroke of the pick in the mine, to the charge at the tunnel-head, all is labor. But these thousands of men toiling below are American citizens, and they are paid accordingly. Their wages are represented by the comfortable homes, in thriving villages, at every group of mines in the forest; and where schools and churches and the other appliances and necessities of a higher civilization reveal the contrast between the position of labor here and in Europe. So it is along the whole line; in the railroad and dock service above, on the vessels and in the ship- yards from which they are launched, and throughout the shops by which they are equipped with machinery, on the docks at the lower-lake harbors, and in the second rail service to the furnace, all is intelligent labor. Much of it is skilled labor, and throughout the whole there is an absolute inter-dependence. When we reflect a moment upon the significance of this vast combination of capital and labor to agriculture and to mechanical skill and science in the consumption of their pro- ducts, we see that inter-dependence extends around the entire circle of human industries and binds them together. It is clear that we go far below the production of pig iron for the foundation of our iron manufacture. Its real raw material, of course, is the inert mass as it lies in the depths of the earth before the touch of labor has lifted it into another realm; before labor and capital have passed it on through the glowing fires by which, step by step, it is transmuted into the highest forms that science and art can dictate for |GEOKGE H. ELY, 806 TARIFF COMMISSION. the uses of civilized society. The ores of iron, then, underlying and supporting, as they do, our entire manufacturing system, need, in jus- tice, not only to the labor and capital employed in their production, but as absolutely essential to the maintenance and continued expansion of the manufacture thorough protection against foreign ores ; and they need this on precisely the same grounds and for the identical reasons that every dictate of justice and national policy grants it to the manufacturer of iron in its higher forms. The manufacturers buy our ores. Individ- uals among them may, for special reasons, be willing to deny us the protection equivalent to wbat they receive in the line of their own pro duct ion. The iron manufacturers of the country, as a class, thoroughly com- prehend the relations of this subject. They understand the fatal con- sequences of discouraging the home production, and how disastrous would be any reliance upon a foreign supply. Over and over again in our commercial history has that experiment been tried in relation to- finished products along the whole range of iron manufacture; but it ended always in disaster, until as a nation we were forced to adopt an American policy. The world knows, and we know, the magnificent results of this twenty years of consistent and unchanging policy of protection to American industry. !No, our manufacturers do not wish a repetition of such ex periments, and least of all with the article which underlies their entire business, and of which they required and used, in 1881, nearly 8,000,000 tons. They will be unwilling to sanction a policy which will discour age and retard the home production. They know that, on theother hand, every possible encouragement should be given it, if any adequate pro vision is to be made for the necessary and inevitable enlargement of the manufacture, to keep pace with our advance in population. Allow me here, gentlemen, to correct some very erroneous impressions in regard to the profits of Lake Superior ore mining. It would be absurd, of course, to look at this subject from the single standpoint of the history of a few highly prosperous mines. Out of the fifty-six mines now shipping ore from the Marquette and Menominee districts, there may be ten that can be so characterized. About one- half of this number have only reached this condition after many years of uncertainty and great risk of capital, during which time, and while annually sending large quantities of ore to market, there was never a dollar of dividends. These facts were so well known that manufact- urers steadily refused to risk their capital there, even in a business trib- utary and essential to their own. One mine, after sending to market 500,000 tons without earnings, closed its business. After the so-called “highly prosperous” mines there are a few more which, at present xirices of ore, are making fair earnings ; while for the remainder in the business, profit, as it generally is in new mining ven- tures, is entirely a question of the future. Their chances are as good as those of their xiredecessors, but all must depend u])on the quality and the extent of the deposits to be develoxmd, of course, by time and capital. It must be borne in mind that the conditions here are differ- ent in many particulars from those governing deposits of coal and methods of mining it. But I need not enlarge upon this topic. The facts alluded to have all come under my own observation, and some of them within my own experience. Wherever inordinate profits have been realized they have been due to exceptional and temporary causes. But the tendency has been always to reinvestment in the same business, with the unfailing GEORGE H. ELY.] LAKE SUPERIOR IRON ORE. 807 result of increase of production to the ultimate advantage of the trade. But, to return: it is sometimes argued in defense of low duties on foreign ores that there is an insufficient supply at home of certain qualities required for the Bessemer pig iron manufacture, and especially of manganiferous ores needed for spiegeleisen. If this were true un- der an extraordinary and unexpected demand, it is true no longer when the development of our ore industries in different parts of the country has shown an abundant supply of all that is required for the Bessemer manufacture. No argument, therefore, can possibly be urged for low duties based upon this assumed necessity. Every chemical constituent of Bessemer iron is here, not only in abundant supply, but favorably distributed. The importation of foreign ores hitherto has been principally from Spanish and Mediterranean ports. They were: In 1879,284,141 tons $681,467 In 1880, 493,408 tons I, 436, 809 In 1881, 782,887 tons 2, 222, 652 Upon these figures a very high authority upon this subject most justly remarks : Like the statistics of our imports of iron and steel in the last three years, the above table of our imports of iron ore in three years must be ;in eyesore to every patriotic American. That this country, with all its wealth of iron ore, and its splendid trans- portation facilities, should have imported in these three years over one and one-half million tons of iron ore, paying for it over four million dollars, is a remarkable fact upon which the next generation of American iron and steel manufacturers will look with astonishment. The Spanish ores, composing the largest portion of the importation of last year, were entered for duty at the average only of 7 s.; paying, at 20 per cent, ad valorem, about 35 cents per ton. This small sum, then, is all that stands between the labor of a country that admittedly stands at the foot of the scale among civilized nations and the labor of the United States. Finally, gentlemen of the Commission, permit me to suggest a few obvious conclusions growing out of this discussion. The present condition of the iron trade of this country thoroughly justifies the policy of protection under which it has grown to its enor- mous proportions. This trade now underlies our entire industrial and financial system, and its relations to the highest interests of the nation will never be less important and controlling than they are to-day. That policy must be continued. The principles, however, on which it is founded apply to the ores of iron precisely as they do to the finished products of iron, only the argument is stronger. Reliance upon foreign importations is out of the question. Home production, then, should receive every possible encouragement. Monop- oly in an article of inexhaustible supply over the entire continent is impossible. The capital and labor employed in it should be allowed, without det- riment from foreign sources, to work out, upon our own soil, the neces- sary and the never-failing result of competition — the cheapening of the product and its reaching the consumer at the lowest possible cost. In that direction only is safety and cheap iron. By Commissioner Oliver : Question. What recommendation do you make? — Answer. When I commenced my statement, I referred, perhaps not sufficiently in detail, to the fact that our appearance before you was rather unexpected, and 808 TARIFF COMMISSION. f GEORGE H. ELY. that we intended before presenting our case to you to have a conference with representatives of the other iron-ore districts of the country. We have not had that conference. In justice to them, I think we should have a conference before naming the precise rate of duty which we think should be levied. I shall be happy to lay the result of that conference before the Commission. Q. Are there any ores imported from Canada now? — A. Very few. The principal competition with our own ores comes from Europe. How- ever, there is every prospect, in fact I may say a certainty, that the railroad now contemplated to connect at Sault Ste. Marie with the Northern Pacific Railroad, along the southern shore of Lake Superior, will greatly tend to develop this ore region. I understand also that the Canada Pacific Railroad intends to build its road eastward from Win- nipeg around the north shore of Lake Sujierior, and, if they do, it will in all probability open up a large extent of iron-ore territory there. As far as my individual opinions go, without a comparison of views with my brothers in the trade, I apprehend that within the next ten years our principal competition will come from that direction. Now, it is sim- ply a question whether the policy of this nation shall develop territory, create wealth, and enlarge population on this side of the border, or whether all these elements shall go to the other side. Q. I believe you have stated that ores from the Mediterranean were entered or appraised at about 7 s. ? — A. Yes, sir; that is the average of last year. Q. What would be the cost of these ores in Canada to day at any of the mines that, have been developed there; how low could they enter their ores to bring them over the border? — A. I am uninformed on that point. The trade has been so small hitherto that very little attention has been paid to it. I have been shown within a few days analyses of ore lying in a forest over there which can be laid down at our lake ports at a ridiculously low price. But, as you are aware, we have a little defense on this side in the fact that a large portion of the ores from Canada are refractory. Q. The ores from the Mediterranean are very rich, are they not ? — A. I understand the average yield of Mediterranean ores, as they are landed in this country, is not above 55 per cent. They are low in phosphorus, and are suited in that particular to the manufacture of Bessemer iron. Q. Do you not think that the large amount imported of these ores was caused by the low freights which ruled in 1879 and 1880 ? — A. I omitted to allude to that ; but the amount imported grew to the propor- tions it did, in my opinion, almost exclusively from cheapness of trans- portation as return cargoes of oil and grain freights. When we have a large exportation of chreals and a large exportation of oil, the price of the return freights is merely nominal. Q. Do you think they would have imported them if the Bessemer ores had not been placed at such a high figure ? — A. 1 think for a period of about two years, during which there was an entirely abnormal condition of the iron trade of the country, when there was a demand for railway construction all over the continent, and when our mills were pressed to their utmost capacity to supply that demand, and only Bessemer iron could be used — under that abnormal demand the production of Besse- mer ore was insufficient to meet the demand. Under that condition of J things, of course the Bessemer iron manufacturers looked everywhere abroad for supplies. Q. Do you think ores could be brought from the Mediterranean with george h. ely.] LAKE SUPERIOR IRON ORE. 809 profit when the price of Bessemer ore at Cleveland is $8 a ton ? — A. They would not come right into this district. Q. I mean into any district? — A. I could not say. We do not know how low the foreign producer of ore can furnish his product. By Commissioner McMahon : Q. What is the cost of labor in getting this Lake Superior ore out of the mine? — A. Mr. Van Dyke represents the mining interests in the Menominee region, and also in the Marquette region, and he can prob- ably answer that question. By Commissioner Porter : Q. Under the new tariff laws adopted in Canada, would the labor in Canada be very much lower than iu this country ? — A. That depends altogether, in my opinion, upon the extent to which they adhere to the policy adopted by the Dominion Government within the last two years. I doubt very much, from my reading and information, whether the pres- ent policy over there is a permanent one. Q. At the present rate of tariff is there a very great difference in the cost of labor in Canada and in this country? — A. I think there is. Q. Are wages much lower there ? — A. I cannot give you a compari- son ; but the price of labor generally is lower in Canada than here. I have no statistics with me on that point, how T ever. We did not prepare ourselves on that particular subject. Within the last few years there have been very small importations of Canada ores here. I think the competition as to prices of labor a few years hence will depend very much pn the policy of the Dominion Government — as to whether it is a permanent policy or not. By Commissioner Boteler: Q. Have you had your attention drawn to the belt of iron ores along the James River, in Virginia? — A. No, sir; I have not. Q. Or to any of the other beds further south? — A. I am somewhat familiar with the deposits in Alabama. I think many of these develop- ments in Virginia have been quite recent. They would be pretty badly off, however, in the James River district, unless there was a strong pro- tection from foreign ores, for there they would have the necessity of relying upon railroad transportation inland; and that is the complicated system under which we are putting Lake Superior ores into the trade. Q. I understand from your argument that you are perfectly satisfied, from your knowledge of the iron deposit of the country, that there are ample supplies in this country, of the best varieties, to supply the iron manufacturers with what they require in their business? — A. I have no doubt of it whatever. Q. And you think if we admit the foreign ores free it would be dis- astrous to that protection, and consequently injurious to the iron man- ufacturers, compelling them to depend on foreign ores? — A. Yes, sir; certainly. Iron ore mining in the Lake Superior region, in a great many cases, has had indefinite results for years. Y ou put a hundred thousand dollars into a mine there (and I could name a dozen such cases; I have stocks of mines in my safe which represent a total loss of capital) and expand the production of iron under great risk of capital ; and to keep up the production of iron, in order to meet the necessities of the iron manufacturers of this country, taking into view the certainty of the im- mense enlargement of that manufacture, it is absolutely necessary that there should be a strong and thorough protection, so that the people will be encouraged to go and plant their money, as I have done, in mines 810 TARIFF COMMISSION. [GEOBUE H. ELY. which are entirely fruitless in results. But this production of iron ore can never be developed except through such a process. By Commissioner Underwood : Q. What portion of Alabama do you refer to in speaking of tlii& very rich non ore that is found there"? — A. I refer to the Birmingham district, so called, and to two or three other districts near there. 1 understand that there are very large supplies of ore in Northern Ala bama, and in portions of Tennessee, and that the production is growing to large proportions. Commissioner Underwood. It is a fact that we are shipping iron ore now from Northwestern Georgia to Terre Haute, Ind. The Witness. I understand that is so. Three or four years ago an agent of some of those mines came up with samples of ore and with an analysis, and asked my opinion of the practicability of sending those ores into the Mahoning district here in Northern Ohio. But to my mind the low yield of those ores and the charges for transportation would prevent their coming here to any extent. MAXWELL WOODHULL.] AGRICULTURAL xMACHINERY. 811 MAXWELL WOODHULL. Cleveland, Ohio, August 31, 1882. Mr. Maxwell Woodiiull, of Fargo, Dakota, submitted the follow- ing statement in regard to the removal of the duty on steam plowing machinery : For some time past the great need of the western couutry has been a cheap method of breakiug and backsetting the prairie sod, and afterward of plowing and cultivating the land. Under existing methods, during the current year, the cost of breaking and backsetting has ranged from $4.50 an acre to $7 an acre, and as the land cau only be reduced to a condition of cultivability from its wild state by both breaking and back- setting, which operations consume a whole season, throwing seeding into the next year, it will be readily seen that the cost of getting land ready for a crop is very great and serves as an addition equal to an average of $5 per acre to the first cost of the land, beside the usual cost of preparatory cultivation for a crop. To reduce this cost, and also to reduce the cost of plowing, an experiment has been made this summer in Dakota with a steam plow, and the result has been watched with great interest by all who are owners or cultivators of land in the Territory. Heretofore no farmer has quite felt able to iucur the expense of importing an outfit, and the manufacturers of steam plowing machin- ery in England, who have been written to on the subject, have not been willing, in view of the high duty, to risk an importation upon the chance of introducing their machinery into the Northwest. But this summer a gentleman has had the courage to bring to the Northwest a steam plowing machine, and has done such work with it that there is reai^on to believe that the cost of breaking, backsetting, and plowing can be re- duced at least one-half upon present rates, which is equivalent to a bonus to wheat-growers of from $2.50 to $3 per acre upon the cost of their land by its use. The English have expended large sums of money in experiments in respect to this class of machinery, and to-day turn out the best steam plows which are manufactured. Indeed it is quite within bounds to say that, practically, they turn out the only steam plowing machinery which amounts to anything. If we would avail ourselves, therefore, of their experiments ; if we would save from $2 to $3 per acre on the cost of land to the farmers of the Northwest; if we would create a home de- mand for such machinery, so that in time our own manufacturers shall have occasion to take up the manufacture of this class of machinery, we should remove the duty from such machinery, which is now in effect prohibitory. To secure to home manufacturers an occasion to manufacture such machines, we must make a home market for them. At present there is no such home demand, for as much as our farmers would like to have their plowing done by machinery, they are prevented from investing in such machines, because, first, they do not know how they will work, and, second, because of their first great cost with the duty added. The trial of the steam plow this year in Dakota, although a successful experi- ment, is but yet an experiment. A great deal about it has yet to be 812 TARIFF COMMISSION. | MAXWELL WOODHULL. learned by our farmers, and before we can say with certainty that the steam plow is suited to our peculiar needs there must be more work done with it. Should the duty be removed, I think there is reason to believe that this summer’s experiment will be continued on a larger scale, and that, should such experiments also prove successful, the result would be a demand for quite a number of steam plows for immediate use in the Northwest. Then the history of the steam thresher will be repeated, and neighborhood organizations throughout the country will be made for the purchase and employment of steam plows. In the joint interest, therefore, of the producer and consumer of grain; of the owners of realty in the Northwest ; and in the interest of the American manufacturer as well, I hope the duty may be removed. I have been requested to submit to you a petition on this subject, and beg to call your attention to the fact that it is signed by some of the largest farmers and landholders in the Northwest. The petition reads as follows : To the honorable Tariff Commission : The undersigned, in the interest of agriculture, respectfully call your attention to the importance of making trial of the application of steam power to the plowing of the land ; and to that end request that you recommend the suspension, for a period of five years, of all tariff duties upon steam plowing machinery and tackle. Dated, Fargo, Dak., July, 1882. Signed by Oliver Dalrymple and twenty-four others, farmers and landholders. Commissioner Kenner. There is a steam plow being used in Louis- iana in the cultivation of the cane-fields, which was made by Fowler & Co., of Leeds, England. The cost of this plow was about $14,000, and the duty was 35 to 45 per cent., a very serious matter. Con- gress, in 1872, passed a law allowing steam machinery for plowing pur- poses to be introduced free of duty for two years. This term having now expired, I understand that this gentleman applies simply for the renewal of that freedom from duty. This steam plow in Louisiana has been found to operate with great satisfaction. THOMA0 H. WELLS. J HOOP IRON. 813 THOMAS H. WELLS. Cleveland, Ohio, August 31, 1882. Mr. Thomas H. Wells, representing the Youngstown (Ohio) Bolling Mills, made the following statement: The branch of the iron business known as the manufacture of hoop iron for some reason or other has been unfairly dealt with by the govern- ment for the last few years, and that part of the business known as the u cotton -tie” manufacture has been unusually interfered with. The de- cisions of the Treasury Department and the courts have made it very difficult during the last three or four yearsfor manufacturers to carry on that business with any degree of success. Since the recent ruling of the department there have been no cotton ties at all made in the United States. The question is, whether that particular manufacture shall be dealt with under the tariff laws in such a way that it will not be de- stroyed. 1 am not here to make a speech on this subject, but I will illustrate it by stating a few facts. It seems to me that the law itself is clear enough. The manufactur- ers, as a rule, feel satisfied that the tariff law on hoop iron is all right, but this particular branch of the iron manufacture has been tampered with injudiciously. It is perfectly proper that this question should be raised and discussed here. There has been a discrimination against the manufacturer of this article, and he feels precisely as the member of a. family does who finds himself turned out of his house and home without reason while the other members of the family are left to enjoy the priv- ileges of the house. We find many other branches of manufacture, much less perfect in the output and not so fine in the production, pro- tected, and the mill owner is fairly prosperous. The honest mill owner who makes a finer article finds, however, that he has no protection, and ultimately, as the case is now in this specialty, his machinery is still, his people idle, and you see no outward evidence of industry whatever. It is a melancholy fact, but I could take you within sixty- six miles of this city and show you a large amount of capital invested, with all the appliances necessary to carry on this business, where the work has ceased and the buildings are entirely vacant. Their business is destroyed, and naturally the persons who are engaged in that particular branch of in- dustry feel almost vindictive toward the officers of the government for permitting this state of affairs to exist. You must recollect that at the time the tariff law was passed this was a comparatively new busi- ness, or, at all events, the articles on which the tariff was to be applied were new to some extent, and the different branches of the business were not thoroughly understood by the average Congressman. I have always had the greatest respect for the Congress which framed this law in 1861. I can see that they did wonders with the amount of information they had within their reach. You would be surprised as disinterested per- sons to see how nearly they came to describing the articles on which the taxes were placed. Therefore I would say that the law itself ap- pears clear enough to us, but there is a loophole in it, and, by a deter- mined perversion of the meaning of the language used, this particular '814 TARIFF COMMISSION. [THOMAS H. WELLS. branch of manufacture has been nearly destroyed. The law says all hoop -iron shall pay a certain rate. I will read the paragraph : All band, hoop, and scroll iron from one-half to six inches wide, under one-eighth of an inch in thickness and not thinner than number twenty, wire gauge, 1| cents per pound. That is the quotation from the law. That covers a large number of widths and thicknesses, as everybody here knows. There is the general statement in the law which fixes it at 1J cents a pound, and then for sizes smaller it fixes it at If cents a pound. Then there is a clause in the law which says : Manufactures, articles, vessels, and wares, not otherwise provided for, of brass, iron, lead, pewter, tin, or other metal (except gold, silver, platina, copper, and steel), or of which either of these metals shall be the component material of chief value, thirty- five per centum ad valorem. Now, no man could possibly suppose that a piece of iron as long as this table, and from an inch to an inch and a half in width, known to every man, woman, and child who ever heard of it to be hoop iron, be- cause it has a hole punched in the end of it, becomes a manufacture “ not otherwise provided for.” I will not ask you to say it is a silly thing, but is it not the greatest outrage on common sense, and can any ordi- nary man give a reason why the punching of that hole in it should change its name % But under that clause these goods are imported. What is the result ? The result is that the rulings of the Treasury De- partment have varied continuously. I would like to read two or three quotations from authority, that you may understand why we feel so strongly in regard to this matter. I have with me a copy of a very im- portant letter prepared by a committee of hoop-iron manufacturers last year, and addressed to Hon. Mr. Windoin, Secretary of the Treas- ury, in the hope of obtaining redress, which summarizes this whole matter, and with the consent of the Commission I will read it. It is as follows : “To the Hon. William Windom, “ Secretary of the Treasury : “ Sir : We would most respectfully represent that an important branch of the iron industry of the United States, known as the hoop iron and cotton-tie manufacture, is at present in a deplorable condition; that rolling mills which employed thousands of operatives directly, and many more thousands indirectly, in the production of these specialties in the iron business are at a stand-still from being unable to compete with foreign manufacturers for the supply of their products in the American markets. This stagnation has reference mainly to the manufacture of cotton ties, for which, year after year, there is an increasing demand in the United States, but which the iron workers of this country cannot supply because of the competition of English manufacturers, who can undersell in consequence of existing rulings of the Treasury Department as to rates of duty. These rulings are contrary, as we believe, to the spirit and intent of the tatiff laws which were made for the protection of American labor. “It would be ungenerous and unwise to trouble the Secretary of the Treasury with our grievances at this time, unless we believed it to be in his power and according to his inclination to redress or relieve them when fairly laid before him. To this end we ask your attention to Rev. Stat., 2d ed., pp. 465, 467. THOMAS H. WELLS.] HOOr IRON. 815 “The clauses affecting the subject are more particularly these: “1st. All baDd, hoop, and scroll iron from one-half to six inches wide, under one- eighth of an inch in thickness and not thinner than number twenty, wire gauge, one and one-half cents per pound. “2d. Manufactures, articles, vessels, and wares, not otherwise provided for, of brass, iron, lead, pewter, and tin or other metal (except gold, silver, platina, copper, and steel), or of which either of these metals shall be a component material of chief value, thirty-five per centum ad valorem. “On the latter clause has all manner of ingenuity been centered to bring hoop iron, by every subterfuge and evasion, into the United States from Europe at the ad valorem instead of the specific duty. Evasions have been practiced more or less successfully on all classes of iron and steel manufacture, but on none has contrivance been more per- sistently applied than on hoop iron, in the case of cotton ties particu- larly. “The subject has been discussed before the Treasury Department frequently during the last few years, by the importer on one side and the manufacturer on the other, and with varied results. A synopsis of these cases and results may now properly be presented to you, and as briefly as possible. “Up to December, 1878, specific duty of one and one-fourth to one and three-fourth cents per pound was paid on hoop iron, according to size. Some time previous to this, importers introduced hoop iron cut to specific lengths and with holes or a hole punched in one end, claim- ing to pay the ad valorem duty as an 4 article of manufacture not other- wise provided for.’ Suits had been brought at New Orleans and New York in the lower courts, at earlier periods, to determine rates of duty in particular cases, and verdicts in favor of the ad valorem duty ren- dered. 'Through a misconception, afterward acknowledged by the At- torney-General, no appeal was taken to the higher courts. The courts and juries in the places named were imbued with free-trade principles. In consequence of these decisions, or for other reasons, the Treasury Department issued in substance the following order: “December 21, 1878. — Order 3824. Hoop iron cut into lengths, and holes punched therein, shall be admitted at 35 per cent, ad valorem, instead of one and one-half cents per pound, as previously rated. 44 On a remonstrance by the manufacturers — “April 17, 1880, Order 4496 states that Order 3824 is reconsidered, and that the de- partment is satisfied that cutting and punching with more or less holes does not re- move the hoop iron from the category of hoop iron in Schedule E of Revised Statutes, and specific duty shall be collected, and that the previous decision, 3824, was in viola- tion of law. 44 This last decision is evidently in accord with the purpose of the tariff' law, and covers importations of hoop iron for barrels, cotton ties, and other articles which by slight advance toward manufacture, at a most trifling cost for labor, had been introduced into this country from abroad at the ad valorem instead of the specific duty. 44 But the foreign manufacturer of cotton ties, with continued perse- verence, still attempted to evade the law by further contrivances. “A cotton tie is about 11 feet long, fastened around the bale by a buckle at the ends — a sample of which is herewith presented. Cutting hoop iron into these lengths was resorted to, and buckles strung on an occasional tie, so as to characterize 30 lengths, with buckles so strung and tied together, as a manufactured ‘bundle of cotton ties.’ On ap- plication to admit these cotton ties at ad valorem rates, the Treasury Department, by Order 4550, May 17, 1880, decided adversely, and classed them as hoop iron at specific duty. SI 6 TARIFF COMMISSION. [THOMAS 11. WELLS. “ So far these late decisions of the department sustain the American manufacturer by reversing the former ruling of 1878. “In consequence of that ruling in favor of ad valorem duty, importa- tions had increased, and large orders in 1879 and early in 1880 were said to be placed in England for barrel-hoop iron and cotton ties. To relieve the importer who had purchased abroad in good faith previous to late decisions, the Secretary of the Treasury caused a resolution to be passed by Congress, June 14, 1880, providing that all contracts of a bona fide character for this class of iron made abroad before March 12, 1880, shall be admitted at 35 percent, ad valorem; so, an order, 4577, June 16, 1880, to this effect was issued; and in answer to inquiry by the collector of customs, New York, on the same subject : “Order 4580, June 17, 1880, was issued to same effect, and affirming tlie doctrine that between hoop iron imported for barrels or cotton ties there was ‘ no substantial difference.’ “Before this time cotton ties were imported in bundles, as before stated ; but, determined to evade the law, the foreign manufacturer now rivets the buckles, formerly shipped loose, to one end of the tie, although such fastening is of no value to the tie, not necessary, never before used, and rather a disadvantage than otherwise. On discovering this new effort to establish a cotton tie as an article of manufacture not other- wise provided for, to be admitted at ad valorem instead of specific duty, an American manufacturer inquired of the Treasury Department as to how it would be classed; whereupon Order 4589, June 26, 1880, was issued, making it dutiable at 35 per cent, ad valorem. “This decision, so contrary to the spirit of other late rulings, if per- sisted in, will utterly destroy, as it has already seriously affected, this important branch of the iron industry of the United States. [The prophecy here made is fully realized. No cotton ties have been made in the United States since, nor can they be.] “It is no discredit to the framers of the tariff law of 1864 that they did not provide specifically against all possible attempts to evade it, par- ticularly as the spirit of protection to American labor is so clearly set forth in its provisions. Doubtless it was thought that unforeseen cases, as they arose, would be easily determined by the intent and purpose of the law. Clearly the revenue from the more advanced manufacture was to equal or exceed that on the cruder commodity, with less labor applied to its production, of which the manufactured article is composed. This principle pervades all the tariff laws, and in an especial manner those relating to iron, steel, and other metals ; the basis of the principle being protection to labor as well as capital. This view is sustained in Revised Statutes, p. 465, where manufactures of steel, &c., shall pay a duty of 45 per cent, ad valorem : “But all articles of steel partially manufactured, or of which steel shall be a compo- nent part, not otherwise provided for, shall pay the same rate of duty as if wholly manufactured. “Apply this to the cotton-tie case. The cost of hoop iron, of which cotton ties are made, is, in England, say $40 per ton of 2,240 pounds; the cost of riveting buckles on the same is about $1 per ton. On this last expendituie of labor the claim of manufacture is set up. If sus- tained, the ad valorem duty per ton would only amount to $14.35; but if not sustained, the specific duty is $33.60 per gross ton. There is no reason, which the ordinary mind can perceive, why this inconsiderable amount of labor should defeat the intention of the tariff' law and destroy the business in this country. THOMAS H. WELLS.] HOOP IRON. 817 “ Evasions of the law will still be attempted in this and every other department of iron manufacture, for which there is no remedy equal to a decided position taken by the present administration of the Treasury Department, which will not only prevent the recurrence of these subter- fuges, but give that permanent encouragement to American labor which meets with more universal approval by the people than ever before since the formation of the government. u We do not desire to criticise dosely or to censure unjustly certain late constructions of the law. We desire redress. Our condition is serious. Already we are at bay. Our mills and workshops are threatened with disaster. Last year’s trade was materially lessened and damaged by importation of cut hoops and cotton ties. This year’s business is uncer- tain, if not hopeless. No cotton ties will be manufactured in this coun- try this year or hereafter under present rulings. No dealer dare buy his supply from the American manufacturer, because importation will surely commence unless speedy relief is granted. No manufacturer can make a cotton tie without certain loss as the tariff law is now interpre- ted. And while American labor is thrown idle, not even the American consumer is sure of the benefit of lower prices, for the importer has the trade in his own hands, for the present at least. “ Although this branch of iron industry started hopefully, with capital invested under the supposed protection of the tariff laws, as the rulings now stand it must prepare to be wiped out from American enterprise ; and its mills, at a great loss, must be converted into other branches of the iron business, producing thereby unnecessary competition and ulti- mate disaster to what otherwise would be a fairly remunerative business. Immediate relief is necessary and most earnestly requested. “ We* may appear to be importunate, but it is hard to be passive. At this time of y ear, in the past, a large number of rolling mills in the dif- ferent States had commenced to make cotton ties for the coming crop ; this year not one has ventured to start. We feel discouraged. Our workmen are discontented, particularly as the loss of trade comes so soon after promise of protection to American labor, which carried their votes successfully for the adminstration. Justice demands and good policy advises that speedy action be taken to place this industry on a proper footing of equal protection with other branches of iron and steel manufacture ; a protection fully intended, and expressed with as much precision in the tariff law of 18(14 as the condition and knowledge of the business at that time enabled its framers to make it. a Attached is a list of the hoop-iron and cotton-tie manufacturers who make this appeal. All the iron and steel workers of the United States are in sympathy, and await with much confidence such action by you as will speedily restore this branch of the iron business to a prosperous condition among the industries of the country. “ By making all cotton ties chargeable with a duty of one and one-half cents per pound you will accomplish this most desirable end, and cause justice to be done. “Very respectfully, “THOMAS H. WELLS, “ Chairman Committee of Hoop-iron Manufacturers. “ Youngstown, Ohio, March 24, 1881.” This letter covers the whole matter, and therefore I need not occupy your time any further, unless some member of the Commission desires to interrogate me upon the subject. H. Mis. 6 52 818 TARIFF COMMISSION. [THOMAS H. WELLS. By Commissioner Kenner : Question. Is it not for the interest of the cotton planter that the American manufacturer should supply at least a portion of these articles in competition with the foreign manufacturer? — Answer. Of course everybody who has a personal or direct interest in the manufacture would be benefited by it. Q. I ask you if you think it is to the interest of the cotton planter that the American manufacturer should make cotton ties as well as the English manufacturer? — A. Yes, sir ; I think it is. Q. Allusion has been made to the importation of cotton ties through what is known as the American Cotton Tie Company. That company was under whose control, do you know ? — A. Mr. McComb seemed to be the representative man. Q. It was stated by Mr. Weeks that the representative man of that company made eight millions of dollars within a period of fourteen years ; do you know anything aboutthat fact ? — A. I do not ; but he was re- garded as a very wealthy man. Q. Do you think if the duty had remained at cents a pound as the regular rate upon hoop iron, having no reference to cotton ties at all, Mr. McComb would have made as much money as that ; in other words, if Mr. McComb had had to meet the competition of American manufac- turers when he was purchasing English iron and selling it to us for cot- ton ties, could he have made as much money ? — A. American competi- tion would undoubtedly have brought the price of the article down to its true value. Q. Would he have made as much money in this country if he had had no com petition ? — A. I can scarcely answer that question. Q. Out of whom did Mr. McComb make this eight millions of dol- lars? — A. Undoubtedly out of those who baled the cotton. Q. Did he make it out of the English manufacturer? — A. He made it chiefly because there was no competition in the business. Q. If he did not make his money out of the English manufacturer, he made it out of the American cotton planter; did he not? — A. Yes, sir. By Commissioner Underwood : Q. Can you give an approximate estimate of the amount of American products exported to Europe annually? — A. No, sir; I cannot. Q. Does not the value of the cotton alone exported from the United States amount to more than two hundred million dollars per annum? — A. Probably it does. Q. Would it not probably amount to as much as three hundred mill- ion dollars per annum ? — A. Very likely it would. CHARLES H. FITCH.] PROTECTION OF LABOR. 819 CHARLES H. FITCH. Cleveland, Ohio, August 31, 1882. The following communication from Mr. Charles H. Fitch, of New Haven, Conn., on the subject of the protection of labor, was read and ordered to be printed : To the members of the Tariff Commission : The undersigned, a special agent of the census of 1880, has from the first had confidence in the work of the Tariff Commission, and believes that great benefit to the country will result from its scientific conclu- sions. He begs leave to present very briefly a few items of testimony relative to some matters which have been brought before the Commis- sion. I. Farm labor and capital are now substantially pro- tected. — It is a mistake to suppose that the protection of an article can go exclusively to the laborer in its manufacture. Researches, to which 1 have been led by my census work, show that its highest relative ben- efits go to unskilled labor on products which have no duty. I cite a single instance: In 1816, farm labor in New York State cost from $3 to $8 a month, average, say, 22 cents a day. (My authority is James S. Brisbin.) In 1816, journeymen in machining and gun-making trades were paid $1 a day. .Now farm labor costs $12 to $25 a month, average, say, 74 cents a day. Skilled craftsmen in machine shops are paid $2 to $3, average $2.50 a day. Thus while wages have gone up by once and a half in the u protected” work, they have gone up by nearly twice and a half in the low skilled u unprotected” farm labor. The reason is simple. Manu- facturers bargain for labor without reference to the tariff. The estab- lishment of an important industry makes a great draft for men. These are drawn from the unskilled classes and a general elevation of wages has followed, but the farm laborer, who complains of a duty on dry goods which is nearly eaten away by American competition, is really well pro- tected. The farm owner is also given an advantage, for he advances prices to pay for his high-priced labor, and while calico has gone down to one-fifth, nails to one-third, wool blankets from one-half to one-third, and so on of the prices in 1816, farm produce has advanced from two or three to six fold in jirice. Also, I have shown in my census reports (in processof publication) that one man now raises three to five times the farm produce raised by one man forty or fifty years ago, and this immense gain to millions has been effected by a few thousand mechanics making improved American farm machinery under patent and tariff protection. II. Iron-workers’ wages are not low. — Prominent free-traders are quoting $1.17 as the average rate of wages of an iron-worker per day on authority of the census reports. This untenable average is cal- culated from the stated number of operatives and stated wages paid. I believe the reduced number of operatives on a full-time basis hourly and yearly to be as much as 15 per cent, less than the nominal average returned. The reason of the overstatement is threefold. The numbers are roughly averaged and returned by proprietors, who are not disposed to belittle the forces in their mills; no provision is made for stoppages, short time, or short-handed running less than one month, on the sched- 820 TARIFF COMMISSION. [CHAKLE6 H. FITCH. ules, and the times averaged for large and small concerns alike slightly distort the average per operative. The result is a sort of statistical anamorphosis which Mr. D. A. Wells takes as the true figure. The cen- sus, however, provides for this very matter by a special canvass of skilled and unskilled wages, which average $2.59 and $1.24 respectively. It would follow from the false average, $1.17, that there must be less than no skilled men among the iron-workers, a reductio ad absurdum. III. Protection ultimately makes cheap capital in special productive facilities.— The gains of capitalists in protected indus- tries, requiring expensive plants, are offset by an unrequited contribu- tion to the wealth of the country. So long as advantage is offered, en- terprising men crowd in to get the benefit. They build special machinery, erect buildings, and establish special facilities from which they derive only a temporary large profit, for at the first setback of overproduction these facilities go upon the market at a fraction of their cost, and be- come as truly a contribution to national wealth as is a gold mine or a canal, being in fact cheap tools for labor. IV. The best protection of labor is the encouragement of THE INDUSTRY WHICH DRAWS MOST LARGELY UPON LABOR. — Com- mon, and indeed all labor is advantaged by the protection of the indus- try which draws much labor from other callings, and employs many men foT* the product or service. Shipbuilding and shipping are such indus- tries. The latter cannot well be protected by tariff, but best by bounty or remission of taxes. Two or three words on this point : Labor cannot be protected when there is a glut of labor, nor producers when there is a glut of product. In 1874, the panic commencing in 1872 had reached its maximum effect on the prices of labor. Skilled mechanics were working at 75 cents a day, and note the effect — farm labor became cheap- ened, and in 1874 shipbuilding rose suddenly to an amount exceeded only in two years before (1855 and 1856), in the history of the nation. Then better wages began to prevail, labor was drawn into other work, and shipbuilding fell away with the same amazing rapidity with which it had risen. To establish a shipping such as that of England, would require over 200,000 able-bodied men. Take such an army from the trades, and labor would be able to assert itself for a while to come. V. Present protection is not as great as supposed. — Our large factories cannot easily be pushed to the wall by foreign competi- tion, because their superior facilities, established under a protective stimulus, render them formidable in any competition. The English workman is not made of India rubber. England has not the labor to supply this country adequately with manufactured goods, and in many arts her productive capacity per operative is away below ours. Under the tariff' she can occasionally shove off a surplus of overproduction upon us in articles, a steady drain for which would bring free-trade prices close up to protected prices. When we can crowd 100,000 Eng- lish sailors off the sea, then, and not till then, will England have 100,000 additional men to pit against our makers of iron, hardware, and cutlery. American protection has given the laborer higher intelligence and self-assertive power, has varied his comforts, and has often doubled, trebled, quadrupled, or more, the capability of a man to produce actual wealth. These benefits are beginning to be reflected upon foreign labor. We have seen the best fruits of the protective system, but our orange may not be sucked entirely dry. While an industry is growing, a de- gree of protection for it benefits all labor, but when it ceases to grow, overproduction occurs, and then the best protection that labor can have in that direction is free trade. CHARLES H. FITCH.] PROTECTION OF LABOR. 821 I doubt not that the Commission, in wise discrimination, will vastly better the present system, ease where it galls, and make provision for a more symmetrical national development. It will be a great historical work. I should not presume to advise gentlemen of so much greater experience than myself, but as I see that you are submitting to counsel from the wise and the otherwise, I have made bold to place forcibly before you the foregoing pertinent facts, which stand at variance with the repre- sentatives of some of your witnesses. Very respectfully, New Haven, Conn., August 24, 1882. Charles H. Fitch. 822 TARIFF COMMISSION. [JOHX H. VAN DYKE. JOHN H. VAN DYKE. Cleveland, Ohio, August 31, 1882. Mr. John H. Van Dyke, of Milwaukee, Wis., made the following statement : One of the Commissioners asked the question of Mr. Ely [see state- ment of George H. Ely] as to the average cost of labor per ton for get- ting our Lake Superior ore from the mine. I do not think that that question could be answered. You would not find two mines where the cost would be anything like the same. Take a mine which produces 360,000 tons a year. We have to estimate the cost of timber used in the mine, the cost of transportation, hauling, and other items, and it would be a very difficult matter to tell until the end of the year what the actual expense was. We operate one mine where the expenditure will exceed the product this year. We have endeavored to get at the per- centage of cost ourselves, but I do not suppose we can answer that ques- tion with any approach to accuracy. By Commissioner McMahon : Question. What is the relative proportion of the daily wages of the American miner as compared with the European or the Spanish miner? — Answer. I do not suppose that the Spanish laborer gets one-fifth the wages the American laborer does. Q. You think the American gets five times as much wages as the Spaniard? — A. Yes, sir. I have been told that these Spanish miners receive about 20 cents a day; but I cannot make that statement author- itatively. Q. Then, if it was thought desirable to impose a specific duty of so much a ton on iron ore instead of the present ad valorem rate, it would have to be computed on that basis in order to get the proper protection, would it not? — A. Yes, sir; I suppose so; that would be one of the items. Q. What other items would enter into the calculation? — A. The con- dition of the mine. They are mining in the Spanish mines very largely on the surface; and the condition of the mine, and the necessary ex- penses to work it would be an element; also the fuel. This year for running our mines the fuel will cost us $50,000, whereas in surface mining this expenditure would not be necessary. By the President : Q. All these mines require timbering? — A. Yes, sir; some more and some less. We get a monthly report of the labor at our different mines, and have attempted to get at an average cost per ton ; but, until the end of the year, we cannot make up the average, for the expenses of the different months are not uniform. By Commissioner Ambler : Q. Could you give us the average for last year? — A. My impression is that the average last year was about $2.50 per ton for labor-cost at the mine. Q. What is the average daily wages which you pay the miners? — A. We pay $1.40 to ordinary day laborers, and the wages increase ac- cording to the grade of the workmen until the captains get $4,000 or $5,000 a year, and the superintendents a large sum. A great deal of the JOHN H. VAN DYKE.] IRON ORE. 823 ore is contracted for at so much a ton, and sometimes they make high wages, and sometimes not. By Commissioner Boteler: Q. What other expenses do you charge yourself with besides the labor in mining? — A. There is the item for cropping, which is a very consid- erable item, and for timbering. In this mining business, we have also to keep up our work of explorations a year in advance of the mining, otherwise we could not keep up with our contracts for ore. We cannot make contracts for ore unless we have the ore in band. We must have our mines sufficiently developed, and the slopes must be of sufficient size so that we can get at the product. By Commissioner McMahon : Q. Does the mining interest recommend an increase or reduction in the present rate of duty, or are you satisfied with the tariff as it stands? — A. We think the iron-ore interest has been pretty much overlooked. The present tariff gives us hardly any protection at all, when you con- sider the manner in which the duties are paid on foreign ores. We meet foreign ores at Pittsburgh, Johnstown, Harrisburg, and Bethlehem; our ores are almost entirely shut out. I think the entire purchase of the Johnstown mills last year was 400,000 tons of ore, and that was all foreign ore except about 75,000 tons. By Commissioner Oliver : Q. Did not that condition of things arise, in the beginning, from the law of supply and demand, which makes value ? Under the extraor- dinary impetus given to the business, for a period of about two years, were n'ot the prices of ore fixed by the mining companies in this coun- try possibly too high ? — A. We did not advance our prices a dollar. Q. Besides, the railroads were charging for carrying ore from here to the points you name (say 160 miles) as much, or nearly as much, as they did for carrying it from tidewater to the same point ; twice the distance. Had not that something to do with it? — A. Yes, sir. Q. The point which I wish to make is, that this foreign trade, of which you complain, has been stimulated by bad management on this side ? — A. I think it arose from this fact: that these vessels taking our grain and oil to the Mediterranean ports could bring the ores back at a very low rate of freight; and, having once started that business, they are keeping it up. Q. But is it not a fact that the railroads charged on your ore twice as much for the same distance as they did on the foreign ores ? — A. Yes, sir; 1 think that is so. Q. And at the same time, under that peculiar demand, your people went possibly a little further than they should have done in putting prices too high? — A. Our company did not; we refused to do it. I told them it was a mistake. But many of the companies did that. By Commissioner Kenner : Q. In answer to a question put to you by Commissioner McMahon as to whether you wished a reduction or increase of duties, or whether they should be left as they are, you replied that the duties now paid were virtually no protection to you; what do you mean by that? — A. I mean that the duties being ad valorem, the manner in which these foreign ores are invoiced makes the average duty a very low rate, say about 35 cents a ton. A dollar a ton on ore would be much below the corresponding duty now imposed on pig iron. Pig iron now pays a duty of $7 a ton, and it sells for $21 a ton; the duty being one-third of the value. I do 824 TARIFF COMMISSION. [JOHN H. VAN DYKE. not think the manufacturer has any reason to complain; the protection is all on one side. Q. Why is it that foreign ores are assessed so low? — A. Because of the low price of labor abroad, and the low water- freight. They have water transportation abroad all the way to the seaboard. Q. Is it dependent at all on the fact that the invoices are made out lower than they ought to be?— A. I think so. Q. Is it not also dependent on the fact that the ores are not bought by our people, but are consigned to agents? — A. Yes, sir; I think it is. Q. Then we should change the form of duty? — A. Yes, sir ; I think it ought to be a specific duty ; that is the only way we can meet the foreign competition. By Commissioner Boteler : Q. What specific duty do you think should be placed on foreign ore? — A. My own judgment is that anything less than a dollar a ton would not afford us any protection. The New Jersey people want more; 1 met some of them at the New York tariff' convention. What amount of duty would protect us from the Canadian ores, I do not know. The ore deposits in Canada, through which this new road is to be projected, I am informed are very large. By Commissioner Kenner : Q. To what extent would the interest of the consumer be injured by a duty of $L a ton on imported ores? — A. I do not think they would be affected a particle. I think competition would keep down the prices. Every locality along Lake Superior, on the ore belts, is being explored and developed ; and so in regard to other parts of the country. By Commissioner Garland : Q. Would you make this a specific duty without reference to the value of the ore? — A. That question has been discussed, but we have arrived at no decision upon it. A great many things would have to be consid- ered in that connection. We have a great many ores in the Lake Supe- rior region that could be used profitably for the general market, which are lower in metallic iron. But at present, with the high rates of trans- portation, we do not treat them as shipping ores. We cannot ship any- thing under 50 per cent. Q. Is not that the case with foreign ores ? — A. No ; they have to meet the standard we ship here. They run from 55 to 62. Q. That is what 1 mean. Would you levy a specific duty, at so much a ton, without reference to the value of these ores ? In other words, would you require No. 55 to pay as much as No. 62? — A. No. 55 will command about the same price, on account of the other ingredients. Q. Then it is about the same value? — A. Yes, sir; about the same value. Take these 55 Spanish ores, very low in phosphorus, and they command almost the same price in the market that the higher metallic ores do. Commissioner Oliver. They are more easily smelted, and are lower in silica. Q. Then a specific duty would be as equitable as an ad valorem duty? — A. Yes, sir; that is the view we take of it. By Commissioner Oliver : Q. Do you know the rate on the Canadian ores that were largely im- ported twelve or thirteen years ago ? — A. I do not. There has not been enough imported here to attract our attention to them. T. ARMSTRONG.] CHEMICALS. 825 T. ARMSTRONG. Cleveland, Ohio, August 31, 1882. The following remarks on the tariff by Mr. T. Armstrong, of Phila- delphia, Pa., were read and ordered printed : Mr. President and Gentlemen of the Commission : The follow- ing points and suggestions are made on behalf of the Pennsylvania Salt Company : In 18G0 the total value of goods manufactured in this country, according to the United States census, was $1,885,861,676; in 1870, $4,232,325,442. The compilation of the statistics of manufactures is not yet sufficiently advanced to give the results for 1880;. but from an estimate made by the Superintendent of the Census, the aggregate for 1880 will probably exceed $6,000,000,000, and yet I believe this an underestimate, from the fact that some of the leading articles, such as iron and steel, chemicals, dry goods, paper, &c., have increased several hundred per cent, in place of 124 per cent., the ratio taken. I venture the assertion, that we have become the greatest manufacturing coun- try, as well as the most prosperous, on the globe, and none will question that this marvelous condition of things was wrought by the tariff. Another point of importance lies in the fact that nearly all classes of staple manufactures are 25 to 50 per cent, lower than before the tariff, and upwards of 90 per cent, of all we manufacture is consumed here. 1 do not believe there is a consumer of dutiable articles in the country, if correctly informed of all the facts, but would be entirely in accord with the recommendation of manufacturers, and ask a continuance of the duties tor their own protection. There are many who would overthrow the entire system of custom- house taxation, just because they think the principle is wrong. If civ- ilization was the same everywhere, and labor and all other things were equal, that view, somewhat modified, might be correct. But under all the circumstances, with our present system simplified and adjusted and made clear and intelligible to everybody, it would, in my opinion, be the means of establishing our prosperity on a solid and enduring basis. I would respectfully ask the Commission to consider in this connection whether it would not be a wise measure to urge a limit, say ten years, as the life of the proposed new tariff. Nothing unsettles and embar- rasses the business community so much as the constant agitation of the tariff. It is not simply a question of $130,000,000 of revenue; it is whether hundreds of millions of capital shall be destroyed, or labor degraded and placed on a footing with that abroad. With these preliminary remarks, I desire to present some information respecting heavy chemicals. The first on my list is alum. The history of alum dates back to a remote antiquity ; but it was reserved for this country and generation to produce a strictly pure sulphate of alumina for commercial purposes. The employment of alum in medicine and the arts is very extensive. It is used largely in dyeing. It is added to the size in the manufacture of paper to prevent decomposition, also to bookbinders’ paste for a similar purpose. It is used in the tanning of leather, and is applied in the printing baths of photographers. It is used in sugar refining and in the manufacture of pigments called lakes. It is used in the coloring of morocco. When added to tallow it makes it harder. Water can be purified by means of alum. Fire-proof safes 826 TARIFF COMMISSION. [J. ARMSTRONG. are lined with a mixture of alum and sulphate of lime. Its principal use, however, is in the manufacture of paper. One-half of the annual consumption of alum in the United States is in the manufacture of paper, about 35,000 tons being used for that purpose. Quite all our supply was imported before the tariff, and cost from 75 to 100 per cent, above present prices. Very little foreign alum comes in now. The average price of alum here is 1.75 cents; in Europe, 1.35 cents. The duty is .60 per cent. It will be observed that afte*r paying duty, sea freight, insur- ance, and commission, the price abroad must be cut largely in order to sell here. We respectfully ask for a continuance of the present duty, as the cost of manufacturing approximates the selling price closely. Next on my list is hydrate alumina, alum clay, bauxite, halloysite oi kaolin. Recently very large deposits of alum, earths, and impure hydrates of alumina have been found in several of the States. They are being exten- sively used for alum and other purposes, and with a duty of $5 per ton, we can successfully compete with foreign clays and alumina. Caustic soda is used by soap-makers, manufacturers of wood pulp, and almost uni- versally used by farmers and many others in making their own soap ; it being put up in pound packages for convenience. Enough was sold in this form in 1881 to make 65,000 tons of hard soap, costing only cents a pound. The Pennsylvania Salt Company was the first to intro- duce it as an article of commerce in 1851; since then its manufacture and sale have become enormous; about 15 percent, of the consumption in this country is made here. The cost to manufacture it exceeds the selling price by 10 per cent. The selling price is 3.20 cents per pound. In England it is 2.08 cents. The duty is cents; adding sea ireiglit and other expenses, the equivalent price here would be 3| cents instead of 3.20 cents. But the competition here keeps the price down. We would recommend a duty of 1.J cents per pound for 60 per cent, caustic, and 2 cents per pound for all tests above 60 per cent. The price of caustic before the tariff was 120 per cent, above the present price. Labor and fuel enter very largely in the cost of this article. Any check on its manufacture here would at once advance the price. Bicarb, soda, directly and indirectly is universally used. Glass- makers, brewers, baking powder and soda-water manufacturers, and the majority of the families in the land, use it in some form. The price be- fore the tariff was 92 per cent, above the price now, with a duty equal to 70 per cent, on 2.10 cents, the present price in England. The price here is 2J cents, a difference of only cents per pound in excess of the price abroad, notwithstanding their low labor. The duty is 1J cents, and we request its continuance. The enormous production and competition among ourselves in sal- soda or crystal soda has brought the price down from 3 cents before the tariff to 1.1 cents, a reduction equal to 63 per cent., or before the tariff it cost 172 per cent, above the present price. There is little if any mar- gin of profit in this article. The price in England is tliree-fourths of a cent per pound; sea freights, duty, commission, and insurance added would bring it up to 1.2 cents in New York, whereas it is selling at 1.1 cents. The duty is one-fourth ; we ask that it be increased to one-half cent per pound. Soda ash is used in the manufacture of soap, glass, and paper — essen- tials of civilization. We use about 275,000,000 pounds annually, and there is only one factory in operation in this country, making about 1 per cent, of what we require. Salt, limestone, coal, and sulphur are the principal ingredients in this manufacture, and should be found near each other to produee soda ash at a minimum cost. We have salt, lime- J. ARMSTRONG.] CHEMICALS. 827 stone, and coal in close proximity, and the deposits of pyrites in New Hampshire, Vermont, Missouri, the Labe Superior regions, Virginia, Tennessee, and many other States, offer vast supplies of low grade ores, rich in sulphur. It is my firm belief, gentlemen, that with a duty of one-half cent per pound on 48 per cent., and 1 cent per pound on all tests above that, we can compete with the alkali works of Eugland. And there is no reason why, as in all the cases I have stated above, the con- sumer in the course of a few years should not reap the benefit of com- petition among ourselves, and obtain his supply far below the present cost. The duty is one-fourth cent per pound, equivalent to only 15 per cent, ou the price of soda ash as quoted in Liverpool on the 28th of July. Sulphuric acid or oil vitriol is the most important of all the acids, as by its aid nearly all the others are produced. Its manufacture has in- creased nearly 1,000 per cent, in the past ten years, it is extensively used in refining crude petroleum, and in the manufacture of fertilizers. We ask a continuance of the duty of 1 cent per pound. In 1866 the price was 5 cents per pound, to-day it is 1J cents, another striking illus- tration of what competition among ourselves has done. Kryolith is a soda ore and is found only on the west coast of Green- land. It is a monstrous rock 600 feet long by 200 feet in width and over 100 feet in depth, and, in a pure state, contains about 76 per cent, of soda. It is brought here at enormous expense, vessels being built expressly for the trade. Navigation being very hazardous, sometimes vessels are caught in the ice, and it is several months before they suc- ceed in getting out. About $1,000,000 have been invested in plant to work it, but the price of soda has declined, so that per se it pays only 3 per cent, on the capital. W e ask that kryolith be continued on the free list. There -is a term frequently used in the tariff, to wit, “ Articles not above enumerated or not otherwise provided for.” I would suggest the following amendment: “Articles received under a name not stated in the tariff must state the component parts thereof.” It might occur that by changing the name the custom duties would be evaded or reduced materially. There is one more subject that is indelibly marked by the influence of the tariff, that I respectfully call your attention to. I refer to the education of children of the working classes and the masses generally. I consider this of vastly more importance than the pruning of the tariff* or the change of a decimal fraction at the custom-house. The rock upon which this fabric of government will stand is the education and culture of the masses, and I hold that without liberal wages, thereby giving the people an opportunity to send their children to school, the desired end cannot be attained. Liberal wages and a liberal tariff have a strong affinity for each other and go hand in hand together. In our own factory we have a school with an average attendance of four hundred scholars, children of the factory hands. Do you think, gentle- men, this would be the case if labor was on a par with that of Europe ? And this particular illustration is only one of the thousands of a simi- lar nature that exist in this country to-day. 828 TARIFF COMMISSION. [DAKIEL MYEIiS. DANIEL MYEBS. Cleveland, Ohio, August 31, 1882. Mr. Daniel Myers, of Cleveland, of the firm of Benton, Myers & Co., wholesale druggists, addressed the Commission as follows : Mr. President and Gentlemen oe the Committee : I desire to briefly submit a few facts in behalf of the sulphur interests of this country. The Commission may already be aware of the immense deposits of sulphur discovered in Utah during the past few years, besides other mines still further west. One of these Utah deposits, containing several million tons, has been owned by a company of leading business men of this city for some ten years, but, owing to the fact that refined sulphur is allowed to come in duty free as crude or natural sulphur, this im- mense deposit of mineral has been wholly neglected. The imports were, last year, in round numbers 200,000 tons. The custom-house statistics show an annual increase in the importations of about 20 per cent. The duty of $0 per ton on crude sulphur, imposed during the war, was re- moved under the representation and belief that there were no deposits in this country to develop j hence the removal of the duty on crude met with no opposition. The duty still remains on refined sulphur of $10 per ton, and on flour of sulphur of $20 per ton and 15 per cent, ad valorem. The purest of the crude or natural sulphur mined in Sicily does not average 20 per cent, pure sulphur, and yet the article imported as crude or natural sulphur averages over 95 per cent. These facts are sufficient to prove that the article imported as u crude v or natural sulphur has undergone a process of refining, and is in fact refined sulphur, and not crude or natural sulphur. No importer who is at all familiar with Sicily sulphur will for a mo- ment claim that it does not undergo a process of refining before ship- ping to this country. If it is wise and for the interest of our country to allow refined sul- phur to come in duty free as crude sulphur, then would it not be even wiser and of far greater benefit to our country to admit “ pig v iron as iron ore? If it is wise to place a duty on pig iron to cover the difference be- tween labor in this country and labor in Europe, should not the same rule apply to sulphur as well ? If the duty of $6 is restored, capital will not feel timid to proceed at once to operate the well-known mines in Utah, containing millions of tons. With such protection, American enterprise in a few years will drive foreign sulphur from our market, and the millions which are now paid to foreigners for sulphur and to foreign ship-owners for freight would be distributed in our own country among American business men, American laborers, and American rail- roads. The quantity now consumed in this country, if mined at home, would give employment to hundreds of laborers, and would require a train to transport it of over sixty cars a day for each working day in the year. The restoring of the duty would not be in the interest of a monopoly, but in the interest of the country at large. I can point out on the map at least twenty mines in Utah alone owned DANIEL MYERS.] SULPHUR. 829 by different companies and individuals. Judging from the purity and the immense quantity contained in these mines it is only fair to presume that our enterprising business men will make such progress in develop- ing this product to such an extent as to become a competitor in the markets of the world and give the chemical industry cheaper sulphur than they now obtain from Sicily. Nowhere in the history of the world have deposits been found to compare with the mines in Utah in purity and extent. By Commissioner Kenner : Question. You spoke of the purity of the sulphur of Utah Territory? — Answer. Yes, sir. Q. What practical test does it show fresh from the mines ? — A. It averages 65 per cent. The average of what we had shipped to us was about 65 per cent. Q. What is the extent of the pockets to which you allude ? — A. At the mine I refer to, the deposit covers some 40 acres. We have sunk shafts in the mine 35 feet deep through solid sulphur. On the larger part of this 40 acres the deposit comes to the surface, and the balance is covered with a thin layer of earth from a few inches to twelve inches thick. Q. Were these specimens showing 65 per cent, taken from one mine or from a number of mines ? — A. From one mine — from shafts sunk in different parts of the 40 acres. Q. Where is that mine located ? — A. It is 175 miles south of Salt Lake City, Utah. By' Commissioner Garland : Q. How do you propose to get this material transported ? — A. The Union Pacific Railroad runs within twenty miles of us, and they have offered to build us a spur. The Denver and Rio Grande Road are now building a branch to us. The construction agent informed me that the road would be done this year, but it will not probably be finished before next year. This will give us competing lines. By Commissioner Kenner : Q. What do you estimate that sulphur to be worth at the mine ? — A. It is a question of transportation and refining ; we cannot tell at jjresent. Q. You never have shipped any of it at all ? — A. No, sir. Q. And there is no price fixed at which it could be shipped from the mine? — A. The price that the importers pay to import it would be the only price that could be fixed. We would have to compete with Sicily sulphur ore $ and, as the duty now stands, that averages from $25 to $40 per ton. Q. The sulphur in Sicily averages not over 20 degrees of purity ? — A. Yes, sir. Q. Does not all the sulphur and brimstone shipped from Sicily under- go a preparation before it is shipped? — A. Yes, sir; it is all refined be- fore shipping. There is none shipped crude into this country, to my knowledge. Q. How, then, can they claim the duty on it as crude material, and avoid the duty on prepared or manufactured sulphur ? Has that fact been brought under the notice of the officials ? — A. Yes, sir ; the matter was contested by the chemical industry at a time when there was no one to fight the other side of the question, and they obtained a decision in 830 TARIFF COMMISSION. [DANIEL MYERS. their favor. I believe the customs department at one time did under- take to collect a duty on that ground ; but it was fought by the chemi- cal industry of the country ; and under the belief that there was no sul- phur ore in this country, they have always succeeded in bringing sul- phur ore in duty free. Q. Is it too late for your company, which owns this valuable deposit, to contest that question even now ? — A. It might not be ; but it seems a simpler way to have a law passed defining the matter clearly. We might have the same battle to fight over every few years. By Commissioner Garland : Q. As I understand, you have not developed these mines at all ? — A. We have been doing work on these mines for ten years. Q. What is the.expense of mining this ore per ton? — A. The mining would cost no more than mining clay, because it is right on the surface. Q. What are the principal items of expense in getting that sulphur to market t — A. The transportation would be the principal item, and the refining another item. By Commissioner Kenner : Q. What is the cost of refining ? — A. From $5 to $10 a ton. We shall have to put up refineries there on the ground. Q. Have you made any calculation as to what would be the cost of erecting refineries there ? — A. It would cost $100,000 to go into the bus- iness as extensively as the refiners of New York have gone into it. By the President : Q. What is the process ? — A. Melting in the retorts, and condensing. By Commissioner Kenner : Q. How many tons would a plant that cost $100,000 refine per an- num ? — A. I would say not over 20,000 tons a year of the flour of sul- phur ; that is the finest quality. BICHARD HAWLEY.] FREE TRADE. 831 RICHARD HAWLEY. Detroit, Mich., September 1, 1882. Mr. Richard Hawley, of Detroit, made an argument before the Commission in behalf of reciprocity and a tariff for free trade or rev- enue — representing (he said) not any particular business, but the busi- ness of the country as a whole. He said : I undertake to show that in the decade from 1850 to 1860, under a tariff' for revenue and under the reciprocity treaty for six years, the country had a prosperity unequaled in its history, and a greater gain in materii 1 wealth, in the value of its real and personal property, than it has known in any other decade. I hope, subsequently, to show that the last decade of high protection yielded the smallest gain to the country, and was, as a whole, most unsatisfactory in results. First, in regard to reciprocity. We had from 1854 to 1864-5 a re- ciprocity treaty with Canada. It included all raw products. About six of the ten years, from 1850 to 1860, were under the rule of that treaty, and added, of course, to the unprecedented prosperity of that decade. We in this city and neighborhood are more intimately con- nected with trade relations with Canada than any other part of the country. This city had a nice trade with Canada. In 1860 we sold to Windsor (to be distributed from there) dutiable goods to the extent of $180,000*; and one of our most esteemed citizens and business men said to the late Senator Chandler that the worst thing which he had ever done for the city of Detroit was in opposing that reciprocity treaty. Under that treaty we sent immense quantities of goods to Canada — corn, for instance. One firm here dealt very extensively with Canada in corn. A gentleman from Lucan, on the line of the Grand Trunk Railway (Mr. Stanley), said to me recently that in that little town they used to get from forty to fifty car-loads of corn in the course of the year, where they now only get two or three car-loads. The direct effect of the abolition of the treaty on the city of Detroit has been to depre- ciate very greatly real estate lying between Jefferson avenue and the river, and between the Milwaukee and the Michigan Central Railroad depots. A gentleman who has his business real estate and his business on the northeastern corner of Woodward avenue and Atwater street (Mr. Eaton) estimates his loss in property and business at 30 per cent. I talked yesterday with a former city assessor, who said that after the abrogation of the reciprocity treaty, and for several years in succes- sion, the value of property in that part of the city was put down 10 per cent., and he thinks that 30 per cent, is but a fair estimate of the depre- ciation. Its abrogation was unfortunate. Another gentleman, a man- ufacturer of this city, said to me in conversation within a week that the benefits which the city of Detroit ought to have from its trade with Canada would be equal to half of those derived from its trade with the rest of the State. There are very many commodities that are, under the existing state of things, virtually cut off from us, and which we want very much here, in order to fill out the measure of our prosperity. Take, for instance, building-stone. I am informed that we have but a single quarry within a reasonable distance of Detroit. That, and the fact that there is a duty 832 TARIFF COMMISSION. [RICHARD HAWLET. of $1.50 per ton, makes toise stone excessively high here. Nearly oppo- site where this quarry is there is a quarry over the Canadian line. If we could get this raw product as we used to get it, we should save from $6 to $7 on toise stone which now costs $18. This is of immense importance to builders and everybody who wants to build a house. We claim that this reciprocity treaty assisted materially in tilling out the large and unprecedented measure of the prosperity and gain in the decade from 1850 to 1860. You are perhaps aware of the reciprocity treaty. In 1864 we had here a large commercial convention represent- ing the business interests of this country. One of the topics of chief interest was, whether we should revise and renew this reciprocity treaty or should give a year’s notice (under its provisions) to abrogate it. The question was discussed pro and con. Mr. James S. Joy was chair- man of the reciprocity committee in that convention. A sort of com- promise was reached. It was that notice should be given to terminate the treaty, and that the government should be requested to negotiate a new treaty. A new treaty was negotiated, under the auspices of Mr. Pish, on the part of our government, and by Mr. George Brown and some other gentlemen on the part of the Canadian Government. That new treaty came before the Senate, where it was discussed, and where it met both with opposition and approval. Final action was positioned until another session, and the result of the whole matter was that the neAv reciprocity treaty was not confirmed. And we have been left sub- ject to the opposing tariffs of the two governments, which almost virtu- ally cut off trade and intercourse. During the pendency of the discussion in the Senate I visited many of the citizens of Detroit, and the result was that a petition of the very strongest character went from Detroit to Washington in favor of a re- newal of the reciprocity treaty. There are very few business interests that were not represented among the signers of that petition. Even among the lumbermen and gentlemen interested in pine lands I found only one or two who did not sign it. One of the largest pine-land own- ers in Michigan (or possibly in the United States) was cordially in favor of it. I know that there is a lumber interest in this country which stren- uously opposed the renewal of the treaty. The Commission can judge, however, whether there is any good reason for such opposition. These gentlemen knew that they did well under the reciprocity treaty in the lumber business. Under it saw-logs came in free; and very many of our lumbermen, who do not own pine lands, had the privilege of getting saw-logs from across the lakes free of duty, which was very much in their interest. By Commissioner Oliver: Question. Your argument is, that from 1850 to 1860, under free trade, the country was more prosperous than it was from 1870 to 1880"? — Answer. Far more prosperous. In regard to the decade from 1870 to 1880 I may remark that, while some of our industries have been over- stimulated, or, at least, have been very highly stimulated, others have dwindled. Our ocean merchant marine has still further dwindled. That was one of the industries which nourished most highly in the dec- ade to which I have already called attention. In the last three years of that decade we built 600,000 tors of ocean shipping; and that indus- try was at the summit of its prosperity at the close of the decade. In the last decade it has still further dwindled. Our shipbuilders claim that they have not had a fair opportunity to show how they could re- KICHAHD HAWLEY. 1 FREE TRADE. oo gain their old position in this matter if the conditions were fair. There is an industry of iron-shipbuilding in this city and at Wyandotte; and, in talking recently with the secretary of that company, he said to me, “Give us our materials for shipbuilding under freedrade conditions, let us get them as reasonably as we can, and we ask no defense against the incoming of foreign-built ships. We are perfectly willing to meet the shipbuilders of the Clyde.” After the termination of the decade from 1850 to 1800 the iron industry in this country was very much stimulated by the enactment of the Morrill tariff, which put the duty on pig iron at $9 a ton. While that stimulated excessively the establishment ot blast furnaces it worked very hard on those industries that used pig- iron as a raw material. Mr. Willard Pope wrote, in a note which I had the honor to receive, an expression of that fact. He is one of the civil engineers in the Detroit Bridge and Iron Works. He said: In our industry we should be employing ten men where we are now employing- one, if it were not for the excessive cost of pig iron caused by that tariff. Let this illus- trate how many edges there are to the so-called sword of protection, and how it slashes into honest industry at every turn. This is a very good illustration of the effect of a protective tariff*. While a few industries, for a time (and only for a time), make undue profits, other industries, which use their products as raw material, suffer and are sometimes extinguished. There was an agricultural-implement manufactory established at Wyandotte. It failed, and most of the money invested in it was lost. If they had been able to get their raw materials at fair competitive prices that industry would probably have been flourishing to-day. I beg leave to show the effect of this system on highly -protected in- dustry. Take the pig-iron industry as an example. As I said before, the tariff* was put up so high on pig iron that blast furnaces sprung up all over the United States. They over produced so much that pig- iron is said to have been sold under the hammer, in some instances, at $8 a ton; and nearly one-half of this large number of furnaces closed up, and the men employed in them were turned adrift and had to avail themselves of any opportunity for other kinds of labor, for which they were not fitted, many of them not finding any work to do, and having to tramp from State to State. Secretary Evarts said that there were four or five hundred of these furnaces out of blast, and hundreds of millions of dollars lying idle, and the men who had been employed in these furnaces were in the most unfortunate condition. This great reac- tion in the last decade was undoubtedly one great cause of so much diminution of the aggregate gain to the country. And so of other industries. That is the way that high protection works. Gentlemen, we waut a better foundation for the industries of this country than what Daniel Webster called “government patronage.” He said, more than fifty years ago, that that was a poor foundation to build business interests upon, and that the time had even then come when all that intelligence and industry could ask for was fair play and an open field. Under this high protective system, gentlemen, the country has failed to make any such percentage of gain as it made in the decade from 1 850 to 1860. In the mean time our labor-saving machinery has gone on improving, which is one reason why we should have gone higher. The crops were just as good in the latter decade as in the former one. And yet the reports from the Bureau of Statistics in Washington give us but the meager gain in the decade from 1870 to 1880 of 33 per cent., against that of per cent, in the decade from 1850 to 1880. It may H. Mis. 6 53 834 TARIFF COMMISSION. [EICHAKD HAWLEY. be said that from 1870 to 1880 we paid $400,000,000, more or less, of the public debt, and a very large amount of interest upon the public debt. But the answer to that is, that if all that money had been paid abroad, and if it had gone out of the country, that would make a differ- ence which would bring the aggregate gain for the decade up to 41 per cent. But a part of it was paid to our own citizens — probably more than one-half — and it shows again in other forms of wealth. But, allow- ing for the whole amount paid on the public debt, we have still but an aggregate gain for the decade of 1870 to 1880 of 41 per cent. — less than one-third of the gain in the decade from 1850 to 1860. Commissioner Porter. Did you take into consideration the value of the slaves, which was included under the head of “personal property” in the decade from 1850 to 1860, and was not included in the decade from 1870 to 1880? That was a very important item. The witness admitted that that item should have been allowed for, but he subsequently withdrew the admission, remarking that the slaves had obtained their freedom before the opening of the latter decade. He continued : Gentlemen, you have, in brief, my argument. Let me call your atten- tion now to the gain from 1830 to 1840 under a tariff that was mainly protective. It was only 53 per cent. In the next decade, from 1840 to 1850, under a half-and-half revenue tariff and protective tariff (but more of a revenue tariff than in the preceding decade) the gain was 80 per cent. From 1850 to 1860 (an entirely revenue-tariff decade) our gain ran up to 136 J per cent. This progress in the increase of national wealth under a revenue tariff, as compared with the retrogression in the decade under a highly protective tariff, is untouched by the question of slave property, and 1 beg that it will receive that consideration from the Commission which 1 know that it will receive from the country. Commissioner Porter. The abolition of slavery reduced the valua tion of personal property in the decade from 1860 to 1870. That should be taken into consideration. Another matter to be taken into consider- tion is the coming down from a paper basis to a gold basis. The Witness. I am not aware that our paper money did not main- tain as favorable relations to a specie basis in 1870 as in 1880. ■ SHELDON G. kkllogg.] RECIPROCITY TREATY WITH CANADA. 835 SHELDON G. KELLOGG. Detroit, Mich., September 1 , 1882. Mr. Sheldon G. Kellogg, of Detroit, made the following statement on the subject of a reciprocity treaty with Canada: 1 am in favor of our government commencing negotiations with the Canadian Government for a reciprocity treaty. As a citizen of Detroit, interested in its present and its future, I think that reciprocity with Canada would be of the greatest advantage to this city. It only re- quires one to take a pencil and to draw a circle with a radius of a hun- dred miles around this city to understand how intimately connected it is with the adjacent portions of Ontario, and how isolated this city is without such connection. The adjacent points in Ontario are as inti- mately connected with our manufacturing and business interests as the adjacent portions of Michigan; and it does not seem right to a large majority of our business men that there should be, practically, a Chinese wall between this city and Canada. Some objections can certainly be urged against a reciprocity treaty. In the first place, it can be said that the relations between Canada and the United States, and between Ontario and Michigan, are very dif- ferent from the relations between Indiana and Illinois, because different legislatures make their respective laws. But it is only necessary to re- ply to that by saying that we had a reciprocity treaty up to 1866, and that, according to as high an authority as Secretary Chase, it was ol advantage to both countries ; and that, under that treaty, the trade be- tween the United States and Canada was as great as the aggregate trade between the United States and Austria, Bussia, Prussia, Sweden, and Portugal. The Canadians have already adopted a very high tariff, and they may not be willing to enter into a reciprocity treaty. But it must be remembered that we drove the Canadians away before they refused to have trade intercourse with us. If the Commissioners had time to talk with people on the other side of the border, in the neigh- borhood of Detroit, they would understand that there is a strong senti- ment there in favor of reciprocal commercial relations ; and that, if our government was to commence negotiations, it is extremely probable that the Canadian Government would meet us half way. I will state a few points to show why I believe that such a treaty would be of great benefit to the city of Detroit. Pirst, as to commer- cial interests Detroit is beautifully situated, and very attractive. Already large excursion parties come here almost every week from London, Chatham, Saint Thomas, and other places in Canada; and there is nothing to prevent our merchants having almost as large a trade with Ontario as with Michigan except the anti-commercial wall which sep- arates us. Then, as to manufacturing interests, Canada is naturally a market for a large portion of our manufactured products. A gentleman connected with our youngest industry — the Detroit Bronze Company — told me recently that if it were not for the duty which Canada had put on bronze his company would sell near;ly as much bronze in Canada as in the United States, but that the duty is so high that it is practically impossible to find a market there for the bronze. 836 TARIFF COMMISSION. | SHELDON G. KELLOGG. With regard to the people at large. We require a great deal of what Canada produces. Our car companies make use of certain qualities of lumber that can only be obtained from Canada; and if it was possible to get that raw material without duty it is highly probable that we should not have witnessed the spectacle that was seen here last winter when from two to four hundred hands were discharged because there was not work enough for them at the car works. Of course other elements enter into the problem. We need a foreign market for our cars; but with our present prices it is almost impossible to compete with the makers in Europe. ~Now as to stone. Why should the people of Detroit be com- pelled to pay so much higher for the stone used in building the founda- tions of their houses than they would have to pay under a system of free exchange? An objection to reciprocity is interposed on the part of the lumber interest; but that objection can be answered in this way: The rapidity with which our forests are being destroyed for the sake of the lumber is a shame; and it is certain that sooner or later that evil will be put a stop to. It is an absolute necessity that a certain amount of territory shall be covered with forests; and yet our forests are being destroyed for the benefit of a few men who are interested in lumber, and to the dis- advantage of the great majority of people who need cheap lumber. With regard to the growth of the city and the price of real estate here. Why should Detroit be left in the condition of the Rhine towns in the Middle Ages, and be prohibited from having the commercial relations most natural to it? Why should not Detroit be allowed to have the privileges which the Hanse towns had, and to trade with Canada in thefreest possible manner? The citizens of Detroit have not asked much from this Com- mission. Various industries have been represented before the Commission . Some have demanded higher duties on certain things, and some have spoken in favor of free trade. It seems to me that the city of Detroit has a right to ask that this Commission shall give careful consideration to the iso lated position which Detroit occupies. Many of our leading citizens become enthusiastic as they describe the blessings to Detroit that would result from our having a bridge or a tunnel across the Detroit River. But one day (kind fortune hasten it!) there will be universal rejoicing over the union between Ontario and Michigan, and over the assumption by our beautiful and beloved city of its rightful position as the commercial metropolis of the two allied states. CEOtlGr. W. MOORE.] CHARCOAL PIG IRON. 837 GEORGE W. MOORE. Detroit, Alien., September 1, 1882. Air. George W. AIoore, of Detroit, manufacturer of charcoal pig iron at Leland, Alich., made the following statement : Mr. President and Gentlemen of the Commission: The ap- pointment of this Commission is something of a new departure in the business of legislation, which frequently depends largely on inspira- tion for its origin, to intuitions for its progress, and to accident for its results. The last Congress, for some inscrutable reason, deemed a little information an essential element in the business of tariff revision. I wish to give to-day a few of the facts relating to the manufacture of charcoal pig iron 7 which will show something of its relation to the tariff upon it. There is to-day but a very small margin, and in some locations no margin, left as a profit to the manufacturer of charcoal pig iron, after paying the current price for ore, labor, and transportation. Practically, about the only interest that the manufacturers now have in the tariff upon this iron is to enable them to continue to do business and to pay the wages for labor which are now being paid. Of course, if any substan- tial reduction in the price of labor becomes necessary, the workingmen will not easily or at once submit to it ; but a considerable period of dis- satisfaction, and of hardship, poverty, and strikes, must ensue before they will accommodate themselves to the altered condition of things. This means idle workmen, idle furnaces, idle capital, and poor markets for farmers in the neighborhood of furnaces. Largely reduced earnings means largely reduced consumption, and a suspension of prosperity, more or less extended. These results must follow from the removal, or any substantial reduction, of the present tariff, as a necessary conse- quence. The fact is, that more money is paid for the labor which enters into charcoal pig iron, from mine to market, than the entire cost of British iron laid down on the wharves at New York, and this a few statistics conclusively show. Commissioner AIcMahon. Including or excluding duty ? The Witness. Excluding duty and excluding commissions and ex- penses of handling in New York — the mere cost and the freight. In other words, with charcoal iron, with its present prices, labor receives about all the benefit that is afforded by whatever of protection there is in the tariff*. Near the close of 1881 1 took the trouble to address to a number of the owners of charcoal furnaces a blank form, asking them to report to me the rates of wages paid to the different classes of labor, and the actual cost for labor in the manufacture of a ton of charcoal pig iron, from the ore in the mine to the nearest general market. I received ten reports from furnaces and mines located in New York, Michigan, Georgia, Maine, Alabama, Tennessee, Pennsylvania, and Virginia. These returns show the following as the average rates of wages paid for the different classes of labor, viz : Miners’ wages, per day $1 79 Laborers 1 45 838 TARIFF COMMISSION. [georoe w. Jaoonte. Teamsters $1 60 Choppers 1 28 Charcoal burners 1 83 Founders 2 80 Assistants or keepers 1 68 it is difficult to make precise comparison of these with the labor rates in England, but it can be made sufficiently precise for all practical pur- poses. The London Engineer, something more than a year ago, stated that the average wages of miners (colliers) was from 2,9. 8d. (56 cents) to 3 s. (73 cents) per day; that in Lanarkshire the miners were getting paid 1.9. lOd. (44 cents) per day, and gave the earnings of spike makers as 1.9. C>d. (37 cents). In an arbitration between puddlers and manufacturers in England, a little more than a year ago, the basis agreed upon was 8s. Gd. ($2.12) ; the Pittsburgh rate at the same time was $5.50. Mr. Oasson, the manager of the Earl of Dudley’s Staffordshire iron works, said to a reporter of the Pittsburgh Commercial Gazette: We can manufacture iron at just one-half of your cost, so far as the price of labor is concerned. I find that your rates of wages are about exactly double what we have to pay. From the consular reports made to the Department of State in 1878, it appears that the rate of wages to laborers in England was 83 cents per day, and to agricultural laborers 60 cents per day. In making com- parisons in these rates of wages, it should not be forgotten that the great staples which are the necessaries of life, and upon which the British workmen must depend, are largely exported from this country to Eng- land, and the costs of transportation to the seaboard, of middle men, of transportation across the water, and the cost of middle-men and dis- tribution there, must be added to the price the American workman has to pay for the same necessaries at home. As shown by the latest market quotations, the cost of English or Scotch iron, without duty, laid down on the wharf in New York, is from $14 to $16 per ton, including freight. The following is a statement of the average cost of labor alone in the manufacture of a ton of charcoal pig iron in this country, as gathered from the nineteen reports above referred to : Labor in ore, per ton of metal $3 30 Labor in limestone per ton of metal 35 Labor in transportation and handling to the furnace 1 60 Labor for charcoal 7 40 Labor in smelting 2 33 Labor in transportation and handling of pig iron to nearest market 1 70 Total $16 68 This does not include the cost of management, superintendence, cleri- cal labor, or labor in repairs, but simply manual labor. Two dollars per ton additional would be a moderate estimate of this cost. That this cost of making English pig iron is not underestimated we have the excellent authority of Abram S. Hewitt, of New York, in his report in the Paris Exposition on iron and steel, he stated: “In the Cleveland district, in England, the entire cost, including labor, of making a ton of pig iron was 40.9. or $9.68.” And that the protective tariff, so georoe w MOORE.] CHARCOAL PIG IRON. 839 called, benefits the American workman was concisely stated in tlie Lon- don Mining Journal of June 26, 1880, as follows: If the tariff permits the American iron-master to sell to local consumers at $10 per ton higher than before, the full proportion of that $10 must be paid to the workmen, and the British iron-master in all markets, except the American, is benefited to the extent of the extra wages paid in America. It is the province of this Commission, as I understand it, to gather the facts upon which Congressional action is expected to be based. This involves an intelligent consideration of who is to be affected by changes to be made. It is evident that, unless the margin of profit is considera- bly increased in the manufacture of pig iron, any reduction of the price caused by a reduced tariff or other cause must be followed either by depriving the workman of labor, or lowering his wages. If a reduction of tariff upon charcoal pig iron is made, a reduction in the price of labor must be made, or the furnaces closed, for the reason that manufacturers will not run their business at a loss. It is strongly recommended that no changes be advised. That is the universal thought of every manufacturer of charcoal pig-iron in the United States, certainly so far as I know them. If it is expected that the Commission will pass its judgment upon the past general policy of this government in protecting its industries while collecting its revenues, we can say for Michigan that, under the present tariff, or with it, or in spite of it, we have advanced in a score of years from backwoods poverty and rudeness to a condition of the highest prosperity. The State stands to-day first in the production of iron ore; first in the production of charcoal pig-iron ; first in the production of copper; first in the production of salt ; first in the i>roduction of lumber ; first in the value per acre of agricultural products ; first in average amount of wheat pro- duced per acre planted ; and the sum total of her agricultural products annually — the best evidence of her general prosperity — equals the pro- ductions of precious metals in the United States, while her vessel tonnage is greater than that of any other State away from the seaboard. Feeling that this progress is measurably due to the encouragement of our industries, and believing that it has been of much benefit and little injury, the people of this State will doubtless be willing to have the policy continued under which these results have been achieved. In addition to the work which the manufacture of charcoal iron fur- nishes, it developes the country in which it is located. I undertake to say that there is no business whatever that can be compared to it in the way of opening up and developing a new country for agricult- ural purposes. At the time of the erection of the particular furnace with which I am connected, the lands in the neighborhood were in a wild condition. The erection of our furnace was a new start there. We bought it, already erected, about three years ago. There were, perhaps, one hundred inhabitants in the village, and two hundred more in the surrounding townships. Since that time the population of the village and townships has increased to nearly a thousand, a large proportion of which is dependent, directly or indirectly, on the work done at that blast furnace and on the labor employed in connec- tion with it. We have paid out in wages during the last two and a half years more than $200,000, which sum has beeu distributed at that point, and we have paid for transportation somewhere from $50,000 to $60,000, which has gone to develop, increase, and pay for transportation facilities on the Jakes and railroads. The value of the iron ore which we have 840 TARIFF COMMISSION 1 . | GEORGE W. MOORE. used has not been far from $200,000, and the total value of the pig iron made there (turning the rawest kind of raw material, iron ore, into a manufactured product, pig iron) has not been far from $700,000. The farming community around there thas prospered, and we have been the means of bringing into cultivation from 2-J to 3 square miles of land in that neighborhood. All of this has only been made possible by the fact that we have had but little to dread from foreign competition on account of the tariff, which placed a bar between it and that industry. That bar now stands between our activity and its cessation. Its cessation, which means the depriving 250 workmen, at least, of employment, and the depriving of 700 or 800 people of their means of subsistence. The President. It was my misfortune to have been a practical char- coal iron manufacturer in 1818. I knew the conditions of its manufact- ure at that time, and therefore I wish to ask you a few questions. Can you tell me what the production of a charcoal-iron furnace was in 1848 or 1850 ? The Witness. When it was running, it was all the way from nothing to ten tons a day. Question. What is the product of your furnace now ? — Answer. The furnace which we are running averages 30 or 37 tons a day. It has run from 30 to 42J tons, the latter being the highest point reached. It is a 0-foot 6-inch furnace. Q. Of course a charcoal-iron furnace must be located in the midst of forest lands. What is the cost of clearing apiece of forest land in your country? — A. It is extremely difficult to state what is usually the cost to the farmer. The land Is usually cleared by putting in time when the farmer is not doing anything else. Then he burns the wood upon the land, so that the wood is of no possible benefit to him, but rather an injury to the land in some cases. Anywhere from five to ten dollars an acre would be a low enough estimate of the cost of clearing the land and fitting it for cultivation. Afterwards the stumping of the land is a very costly operation. Q. And when the land is cleared for charcoal-iron furnaces, it is cleared with profit to the farmer? — A. Yes. The furnace utilizes the timber which would otherwise be destroyed. The farmer has to get rid of the timber, and he has to burn it in order to make use of the land at all. Charcoal furnaces utilize all his timber. A person going to buy a farm in the neighborhood of a charcoal furnace knows that he can dis- pose of all the charcoal that he can produce. There is not a charcoal furnace in the State of Michigan that has a surplus of wood. Q. What advantages do charcoal furnaces furnish to farmers in the way of transportation and the employment of teams? — A. We have furnished to the surrounding farmers a market for every dollar’s worth of their produce, and, in the matter of transportation, we have opened u]> roads to their farms. Q. Do you give employment to the farmers in the transportation of ore? — A. We have been short of labor all the time in that respect. We have had to take it from here and from other places. In other words, there is not in our district a man willing to do a fair day’s work who cannot have, and has not had during the past two and a half years, his hands full of work at remunerative wages. Q. What is the value of charcoal iron as compared with other irons? — A. The charcoal iron is preferred on account of its freedom from sul- phur and other injurious elements. It is apt to be softer and better, and is peculiarly adapted to the manufacture of fine qualities of mal- leable iron, of Bessemer steel, of car wheels, boiler plates, &c. The GEORGE W MOORE. | CHARCOAL PIG IRON. 841 charcoal hammered iron of the West is regarded as the best that can be had ior the manufacture of boilers, where peculiar strength is required. We are producing in the State of Michigan 183,000 tons of charcoal iron a year, more than double the quantity produced either by Pennsylvania or Ohio. By Commissioner Underwood: Q. From the ore in the ground to the turning out of the iron at the furnace, what is the proportion of labor to material ? — A. The propor- tion of labor is at least 75 per cent. Q. From your knowledge of the business and from the calculations which you have made (the present duty on pig iron being $7 a ton), is that duty necessary to bring up the American producer of pig iron to an equality with the foreign producer of pig iron in consequence of the lower rates of wages in Europe? — A. Unquestionably. At least $7 a ton goes into labor here more than goes into labor in England. A. If that duty were removed, and if you had to compete with for- eign pig iron, would it not be necessary for you to reduce the wages paid by you to the extent of $7 a ton? Where would the loss fall — on the laborer or on the manufacturer ? — A. The manufacturer could not stand that reduction, and would have to shut up shop unless the laborer was willing to stand it. Q. What proportion of the $7 would be a loss to the laborer? — A. The loss to the laborer would necessarily come pretty close to the $7 a ton. I have no hesitation in saying that the laborer would lose all of it — I mean, with iron at its present price. If iron should go up, or ore go down, or transportation go down, of course the loss to the laborer would not be so much. The price of labor would be in a general ratio with the other elements entering into the cost. In other words, the la- bor of the country gets its full share of the profits. By Commissioner Kenner : Q. What effect on your industry would the readoption of the Cana- dian reciprocity treaty have? — A. That subject I have not consid- ered. But I can say generally that here, in the State of Michigan, we should have no reason to fear it. There are but one or two furnaces manufacturing any kind of pig-iron in Canada at present. What might be developed there I cannot say. Some mines of iron ore are being dis- covered in the neighborhood of Toronto and around Georgian Bay, which may change materially the present aspect of business. The general impression, however, would be that the less the present condition of af- fairs is disturbed, the better for all concerned — at least in the United States. That, perhaps, would be a general answer to the question. Q. Would the readoption of the reciprocity treaty be beneficial or ad- verse ; what are the chances ? — A. I should regard it, on the whole, as adverse, unless the matter of iron ore was made the subject of recipro- city. That would undoubtedly benefit the American manufacturers of charcoal pig iron, for the reason that it would probably result in a re- duction (more or less) of the price of ore which we are now compelled to pay to the ore companies in the northern part of the State. That feat- ure of the reciprocity treaty would probably be something of a benefit to us. But otherwise, and speaking generally, I should say that the charcoal iron interest would be averse to having any substantial change made in the tariff, either by the readoption of the reciprocity treatv with Canada or otherwise. <842 TARIFF COMMISSION. [GEORGE W. MOORE. By Commissioner Oliver : Q. I understand from your statement that you would like to have the duty retained on pig- iron, but that it would help you to have the duty taken off iron ore ? — A. As a matter of business, I have no doubt that if the ad valorem duty of 20 per cent, were removed from the iron ores discovered in Canada, the charcoal pig-iron manufacturers ou this side would get the benefit of it. At the same time we might lose in other ways, and probably would. Unquestionably a reduction in the price of ore would benefit us. I cannot see it in any other way. We should be glad, of course, to get ore as low as possible. But taking a larger view of the question, I believe in America for Americans. I believe most thoroughly in the principles of the protection of our industry. And no worthy citizen would ask to have any action taken that would injure any considerable number of people. DANIEL C. ROBBINS. 1 DRUGS AND CHEMICALS. 843 DANIEL C. DOBBINS. Detroit, Mich., September 1, 1882. Mr. Daniel C. Dobbins, of the firm of McKesson & Dobbins, im- porters of drugs, &c., Philadelphia, Pa., submitted the following state- ment: Being a member of the revenue reform committee of the New York Chamber of Commerce, I have thus far hesitated to appear before your honorable body, the more so because our chairman, Mr. Jackson S. Schultz, informed me, some time since, that our committee would, no doubt, at some proper time, appear before you. But being extensively engaged as importers and dealers in drugs and chemicals, as well as in the manufacture of important chemicals, which includes the making of quinine and other cinchona salts, under the firm name of McKesson & Dobbins, I have considered that it was due to your Commission, and to the trade, that we should respond to your kind invitation, and present our views of required reforms in duty rates, at least. When Mr. David A. Wells was in the Treasury Department, in 1869, the drug tariff list was carefully overhauled and largely set aright, in adding a* very extensive collection of crude articles to the free list; and hence there are at present but few crude articles, in our very widely ex- tended business, to be added to the free list. The most important subject to be considered, as we view the situation, is the proper reduction upon protected chemicals. I have looked over the list of the drug and chemical trade pretty carefully and conserva- tively, using Heyl’s Digest, and beg to submit as my opinion that alto- gether too much importance has been attached to specific duties, as a substitute for ad valorem rates. The very worst abuses that exist in our protective list are in the specific form. For numerous very excellent reasons all revenue duties should be, as a rule, specific; and all pro- tective duties should be ad valorem. Our government statistics show that the average annual import quan- tity of all articles varies but little, while prices vary greatly, not infre- quently more than 100 per centum ; and hence, while specific duties are in themselves preferable for the government and the honest importer, the government can much more surely rely upon a stated revenue from specific than ad valorem rates. On the other hand, all protective duties, as a rule, should be ad valorem, because all protective duties in the interest cf commerce, and in the general interest of the country, should be reduced to the lowest sufficient limit for proper protection ; and with the lowest necessary duties the manufacturer cannot afford to accept a specific basis. For example: Quinine salts vary not infrequently from $1.50 to $3.50 per ounce, and as 10 per centum is considered to lie the lowest limit for adequate protection, the manufacturer cannot afford to take a specific duty of 15 cents per ounce in case of an advance to $3.50 per ounce, as the advance would reduce his protection to about 4 per centum. Quinine has frequently touched $4 per ounce. 844 TARIFF COMMISSION. [DANIEL C. ROBBINS. Furthermore, the question before the country of revenue duties is always a simple one, of more or less revenue, to be determined by the need of the government and the quantity of import of any particular article. While disputes about adequate protection can only be properly measured by Congress in general, and by the country at large, through the ad valorem system, experience has proved that ad valorem rates within a low limit of 10 per centum, and perhaps 20 or 25 per centum, are not specially objectionable, while it is dangerous to apply very high ad valorem rates, because such rates tend to promote undervaluation and fraud in the entries of merchandise. JOHN BURT.l MICHIGAN IRON ORE. 845 JOHN BURT. Detroit, Mich., September 1, 1882. Mr. John Burt, of Detroit, made the following argument in favor of changing the ad valorem rates of duty on imported iron ore to specific rates : Gentlemen of the Tariff Commission : The large production of iron ore from the Lake Superior district of Michigan connects our State intimately with the iron and steel industry all over the country. In 1880 the ore beds of that district yielded nearly 2,000,000 tons, or about one- fourth of the total consumption of the United States. The problem is to so adjust the duty on this product as not to em- barrass the iron industry, and yet guard against the cheap labor of other lands and the low valuations of foreign ore imported (which lessens, of course, the revenue of our government from customs duties), and thus allow the development of our great mineral resources, the employment of home labor, and the safe investment of the large capital needed. As our market is mainly in the West, reaching into Western Penn- sylvania aud New York, we can compete in that market with foreign ores better than ore producers in the East can compete with such ores in their market, but we want such duties as shall be fair to all. Our market eastward is narrowed by foreign competition, imported ores coming in under low valuation and largely supplanting ours in and about Pittsburgh and as far east as Cambria County. We have also a growing competition with our Canadian neighbors, their ore depos- its being on water courses just across the lakes, their labor some 30 per cent, cheaper than ours, and their taxes less. The imports of Canadian ore have increased from 3,900 tons in 1879 to 43,000 tons in 1881, or more than tenfold in three years. During the same time, the total importations (including Canada ores) grew from 150,821 tons to 721,073 tous, or fourfold, and are expected to reach nearly 700,000 tons in 1882, when full reports are made. Spa in sent us 263,500 tons, and the French possessions in and near Africa 111,345 tons ; labor in these countries being less than half what we pay on Lake Superior, and valuation for ad valorem duty being but about $2.50 per ton. The demand from Bessemer steel makers for ores free from phospho- rus and of a high grade has tended to keep the price of such ores at our mines up to a point that doubtless pays a few companies that have unusual facilities a fair profit on their investments, but meanwhile lower grades not free from phosporous are sold lower, and pay but little profit. The large companies own their beds or mines, while smaller producers usually pay a royalty to the owners. The wages of some thousands of workmen in our Lake Superior mines will average $2 per day, or from 30 to 150 per cent, above Canadian and Spanish labor of the same kind, audit is this labor which gives its prod- uct its main value, the raw commodity showing a small portion of profit. In view of these facts, the present ad valorem duty on imported iron ore should be made specific, and such duty, if made 80 to 100 cents per gross ton, would be equitable to pig-iron producers, and other iron workers in fair proportion to present duties on products like theirs, and 846 TARIFF COMMISSION. [JOHN BURT. be more just, as well as more sure than the present duty to pay a fair revenue. These statements and suggestions will apply to the Wisconsin ore in- terests as well as to our own ; and all is respectfully submitted for your consideration, and for comparison with other statements which may be made by ore producers and by iron and steel workers. Our wish and aim is to have such adjustment of duties on ores and iron and steel as may be just to all, and may recognize the close relation and mutual in- ter- dependence of these branches of what is really one great industry, working to a common end. u Live and let live” is the tit motto for us all. By Commissioner Kenner : Question. What would you recommend as the duty on iron ore?— Answer. Eighty cents or a dollar a ton. Q. What effect would the readoption of the reciprocity treaty with Canada have on your industry? — A. The probable effect would be to lessen the price of iron ore in the market, to some extent; to what ex- tent I cannot say. The cost of mining, and the cost of labor of all kinds is much less in Canada than on this side of the lakes. The only real effect would be that produced by this difference in wages. Q. You think that the effect would be injurious? — A. Yes; I think it would be very injurious to the general interests on this side. By Commissioner Porter: Q. Have you any statistics as to the difference in wages for the last two years ? — A. I have not come here provided with detailed statistics on the subject. I made my statement from general observation. And my statement is corroborated every day even by our free-trade papers. Wood can be had 011 the other side for $3 a cord which on this side costs $5 a cord. Mr. Hawley referred this morning to the difference in the price of stone. Its cost here is no doubt much greater than it is there on account of the extra price of labor here in quarrying it. In fact, the Canadians are constantly coming over here, especially in the upper portions of the State (the iron districts), on account of their being better paid for their work. By Commissioner Garland : Q. I understand you to recommend a specific duty on iron ore. — A. Yes, sir. Q. Without any reference to the value of the ores ? — A. I should say from 80 cents to a dollar. Q. Do you mean that the rate should vary according to the value of the ore? — A. Yes, sir. Q. Then it would be an ad valorem duty ? — A. That is very true. By Commissioner Oliver : Q. What is your opinion as to the sentiment of the people of Detroit in reference to the reciprocity treaty with Canada? — A. The sentiment is generally adverse. Q. You spoke of labor being lower in Canada than here; the condi- tions being similar. Are they as prosperous, and are values as high, on the other side as on this side? — A. They do not seem to me to be nearly as prosperous. Q. Do people often go from this side to the other side to go into business? — A. Ko ; but people come from the other side over here. Very few go from here to the other side except to have their residence there, "While they do busiuess here. Living is cheaper on the other side. JOHN BURT, j MICHIGAN IKON ORE. 847 Q. (Jan you give an idea of the average value, per ton, of ore in the S A 01 ' 6 T rn en0Ugh “ P^rns to pass the Bessemer requiie ment . A. The average value of Bessemer ore at present, and for the It thaTpricS 8 ’ 18 1 * t0n m the gr0und - The consumers compete for it By Commissioner Boteler: _ Q. Does its value depend on the amount of metallic iron contained in the PennsyllCaTre con~ “free 6 from" to o-foentlTnTh^lJtr^" 8 ° f Steeh ° tber ° reS are worth fr0IU ^ By Commissioner McMahon: Q. Would a specific duty of so much per ton for every ton of metallic klni ofo e Je* 0f A f0 T ery , 8 r S t0n) -’ be a fair test of value of the different kind of oie,— A. It would approximate much closer, but it would not be exactly equal, because it costs more to assimilate and to put into pig iron saar* of rich ° re - More fuei ra By Commissioner Oliver : shSmlHlrVetsi^" 01 " 6 tbe al,a ' ySiS ° f 6Ver >’ carg ° every Q. Do you not find from your experience that it is very difficult to Tlfe a, ‘ exact ana, ysis of iron ore?— A. Yes; it is utterly impossible The ores iuu so uneven that it is impossible to get the same grades and 1 O ThV r° re ? 0Q ! th ? same mi “ e two years m succession y. Ihen 1 understand you to recommend from 80 cents to a dollar a A T 0 !' “ commerciall .V called ore, by weight, not by unit of irorJ A. I do not see any other mode of reaching it but a specific duty. By Commissioner Underwood : undervaluation ?— a[ Yes, slr.^ & ^ W ° Uld prevent a11 *»ud» by ores ? effeCt ° f ** "° L ' ld be the importation of better classes of i Q- ^ndthatit would be a benefit to our people?— A. It would be a irttaasa x co c^ ^ **** 848 TARIFF COMMISSION. [WILLIAM T. JENNINGS. WILLIAM T. JENNINGS. Detroit, Mich., September 1, 1882. Mr. William T. Jenning-s, manufacturer of clothing, spoke on the subject of that industry. He said : From my long experience in the clothing business I can speak of it with great confidence. Fifty years ago I realized a large fortune from it, in New York City. Fire, flood, and rascality took away my fortune, and now I sympathize with the makers of clothing. When I see pantaloons made for $1.50 a dozen, vests for $1 or $1.50, and coats for 75 cents apiece, I cannot refrain from expressing indignation. An erroneous im- pression is abroad that, in consequence of the tariff, the workingman is paying too much for his clothing. There never was a time, within sixty years past, when clothing was so low. A man pays from $35 to $50 for a suit of clothes, made to measure, and the color is there til! the clothes are worn out. But a suit of ready-made clothes, costing from $18 to $20, made in imitation of the foreign article, is the dearest suit that the workingman can wear. The color fades out before he has worn the clothes thirty days. The only relief for the poor, down-trodden working men and women is to open the markets of the world to them. The style and character of American-made garments will obtain preference over any other manufacture. I never saw an English ready-made gar ment that I would buy. Give us the markets of the world and we fear nothing. The prices for making clothing in Toronto and Montreal are higher than in this city. I do feel for the poor working men and wo- men. All that I have to say is that the markets of the world is the thing that is wanted. THOMAS D. HAWLEY. MALT AND BARLEY. 849 THOMAS D. HAWLEY. Detroit, Mich., {September 1, 1882. Mr. Thomas D. Hawley, of Detroit, secretary and treasurer of the Hawley Malt Company, and a member of the executive committee of the National Association of Maltsters, made the following- statement : We feel that the present tariff has done great injustice to us maltsters of Detroit. I have been in the business since 1860. In 1860 we were sell- ing about 70,000 bushels of malt, most of it at home. We had some little outside trade in the States — in Ohio, Indiana, and perhaps Pennsylva- nia. At that time barley came into this country from Canada free (under the reciprocity treaty), and there was a duty of 20 per cent, on malt. At that time, therefore, there was no malt imported into this country from Canada, and there were no malt houses in Canada except a very small one at Galt. Under that state of things, with our barley coming in free and with a duty of 20 tier cent, on malt, our malt business in Detroit grew very rapidly. It reached its highest point in 1868, when it had gone up from 70.000 bushels to 96,000 bushels. But about that time the reciprocity treaty was terminated, and a duty of 15 cents a bushel was put on barley, while no change was made in the duty on malt. From that time our business began to decline, and malt houses began to spring up in Canada. Now malt houses all over Canada are exporting malt into this country, because most of the time this 20 per cent, duty on malt was less than the duty of 15 cents a bushel on barley. The Canadians, therefore, made malt at an advantage, and could actually send their malt into this country at less duty than we had to pay on the raw ma- terial. Of course, under these circumstances, we could not compete with Canada in shipping malt to Philadelphia, New York, Baltimore, Washington, and various Eastern places. One year I bought Cana- dian malt myself, paying 72 cents in Canada for a bushel of 36 pounds (our bushel being only 34 pounds), and a little over 13 cents a bushel for duty (20 per cent.). So that I could actually buy the manufactured article and pay less duty on it than I had to pay on the raw material — the barley. I have not bought malt for a good many years, but I have been buying Canadian barley every year since 1860. The greater number of years malt has been imported into this coun- try at less rates of duty than we had to pay on the raw material. Con- sequently, the malting trade of Detroit, so far as shipping malt is con- cerned, has declined. Where we used to ship hundreds of thousands of bushels to the various Eastern States, we now do no shipping trade of any extent. But malt houses have grown up all over Canada. There is a large one at Windsor, right across the river, a large one in Chatham, a large one in Toronto, in Guelph, in Aurora, in Galt, in Dundas, and at almost every prominent point where there is a good barley country. They ship their malt into this country and j>ay less duty upon it than we pay upon the raw material. This is an anomaly in the tariff which ought to be corrected. Under it our shipping trade declined at least 100.000 bushels from 1868 to the present time. Under any true adjust- ment of the tariff Detroit could be manufacturing hundreds of thou- H. Mis. 6 54 850 TARIFF COMMISSION. [THOMAS D. HAWLEY. sands of bushels of malt, and supplying the Easter barley is the best barley that is raised east of the Rocky Mountains. A Ou m fcount of the coXssof the climate the Canadian barley is gen- era% beavTer and generally brighter in color, and produces a superior e TcalV“he h atteSn°ofthe Commission to the fact that Jj^e^acase 3SX CyajSfK zzsxz >»“ to * trade. By Commissioner Underwood : . Question. Is not barley raised to a great extent in Ohio and hew York!— -Answer. Yes; New York is the greatest barley-growing State i* 1 O^Istheie an y reason why barley should not be raised of as good quaiity on the southern side of the lakes as on the northern side .—A. a* wit ;i i i< the reason! — A. The reason is a climatic one. Q. Does not the region of country between Lake Michigan and Lake Huron and the northwestern part of Michigan, enjoy the same cli mate as Canada A. To a certain extent the climate is similar And yet there must be a difference. Whether they have more moisture in Canada than here, or whether the soil is different I cannot saj y i tmtcS to think that there are differences in the .soil on ^oun of a greater proportion of lime in certain localities of Canada. That has something to do with the superior quality of their barley. , . Q Is it not more an opinion than a fact that the Canadian ba y superior to ours?- A. No, sir. It is a matter that is snswp table oi ac- cnrate demonstration, and it is determined every another m nL P oo p rew if* he brews one day malt from State barley , ana anornei Tv brews malt from Canadian barley, and weighs his product he finds & unfformly he gets 5 per cent, more malt from the Canadian barley. Q. Do you state that as a fact?— A. 1 do. ,. f . | Q. What is the malt used for?-A. Ninety-nine per cent, of ff is used for the making of beer-lager beer-and ale, and all kinds ot malt liq Q 0r Do you recommend that the duty be taken off barley, or increased on malt!— X. It makes no difference to us. We want the thing adjusted If you leave the 15 cents a bushel duty on barley we wantt.e duty on malt raised ; or, if you take off the 15 cuts duty on barley we are sat- . isfied with the present duty on malt. By Commissioner Porter : . Q. How would it be if the duty were taken off both ?— A. I think that , we here in Detroit could stand it. By Commissioner Underwood: O If the duty on malt were raised to 25 cents a bushel, vroul ^ suffice l — A. Yes; if you gave us a difference of tween barley and malt we would be satisfied with that. At the present W things have somewhat altered in Canada They used to haveqmte an advantage of us in the price of labor and other items. To-day I think they pay the same wages in ourbusinessthatwe pay. Q. If both barley and malt were free, wouid not that prevent 1 raising of barley in New York and Ohio .—A. No, sir, I do nl* it would. mOMAS D. IIAWLEY.] MALT AND BARLEY. 851 Q. Would not all maltsters seek the superior article of •barley? — A. Yes; but there are some lands in the State of New York that are pecu- liarly adapted for the raising of barley — that are better adapted for bar- ley than for other grains— and those lands will be always used for the raising of barley. The same is true in Canada. In many cases in Can- ada they grow inferior barley, but the general average in Canada is ahead of our general average. Wherever we have, on this side, supe- rior land for the raising of barley, barley will continue to be raised there. We have some such land here on Lake Michigan and near Port Huron where they raise as fine barley as in Canada. Q. Why not buy that barley"? — A. We do buy it; but of course the quantity is limited. They do not raise more than a couple of hundred thousands of bushels of barley. In Canada they raise 12,000,000 bush- els of barley. Q. How many million bushels of barley are consumed in this coun- try ? — A. The production of beer and ale in this country now is about 16.000. 000 barrels, and the usual estimate is 2J bushels to a barrel. That would make 40,000,000 bushels of barley. I think, however, that the estimate is somewh^ high. I do not think that more than 36,000,000 bushels of barley are used. Q. Then there are 36,000,000 bushels of barley consumed every year in the United States in the making of beer? -A. Yes; of which only 1.000. 000 bushels come from Canada. But that 1,000,000 hits us at De- troit and Buffalo more than it hits malsters at other places. 852 TARIFI COMMISSION. [CLARK CORNWELL. CLARK CORNWELL. Detroit, Mich., September 1, 1882. Mr. Clark Cornwell, of Ypsilanti, Mich., paper manufacturer, made a statement to the Commission in connection with his business. He said that soda ash was largely used in the manufacture of paper; that all the raw materials for making soda ash (such as salt, sulphur, coal, &c.) were found in Michigan, and that he had works in the city of Jack- son where a large quantity of it was made. He found, however, that he could not compete with the English market, because the English wages were not more than half of the wages paid here, and because the coal cost more here than in England. In regard to salt, both countries were about on an equality. The present duty on soda ash was $5 a ton. It would cost from half a million to a million dollars to create a good, nice plant for making soda ash profitably. He thought that with a duty of ten or fifteen dollars a ton (in order to givA a company the chance to establish soda ash works) this country would be, in ten years, inde- pendent of England for the supply of soda ash, because the machinery that would be introduced into the business would more than equalize the difference in the price of labor. But the great trouble was to get capital invested in the business. Salt, sulphur, coal, and all raw mate- rial were within easy reach of the works in which he was interested in Jackson. The freight from Liverpool was so small that the English soda ash could be brought here cheaper than it could be made here. As to the manufacture of paper, in which the witness was also inter- ested, one drawback to its being carried on profitably was the compara- tively high price of labor here as against England. Another drawback was in the item of soda ash, which enters largely into the manufacture of paper, and which has to be imported, while the foreign paper man- ufacturer makes his own soda ash on the spot ; and another drawback was in the matter of patents — almost every piece of machinery used in the business being patented, and wood pulp being patented. Commissioner Garland. Do you propose to have a patent law passed to protect your interests % This Commission has nothing to do with patents. The Witness. I am aware of that. What we want to be protected against is foreign manufactures. The patent is a bigger drawback in most cases than the tariff. If we were on the other side of the border we would have no such drawbacks as patents. The royalty on wood pulp is 810 a ton, and if there was no patent upon it we could manufacture it ourselves. 6. P. COMFORT.] PHOTOGRAPHS. 853 G. F. COMFORT. Detroit, Mich., September 1, 1882. Prof. G. F. Comfort, of Syracuse University, New York, submitted the following statement : I desire to draw the attention of the Commission to one inconsistency in the present tariff laws with reference to importations for the use of literary institutions. At present books and works of art for such insti- tutions are admitted free of duty, but photographs are liable to a heavy duty. As photographs of buildings, statuary, paintings, and other works of art are now largely used in all schools of art, and are valuable in all institutions of learning, I would respectfully suggest that photographs be placed on the free list when imported for institutions of learning, the same as books and works of art, among which the Treasury De- partment at Washington rules that photographs are not included. 854 T4RIFF COMMISSION. [ DENIS T. BTAjN. DEEPS T. EYAE. Detroit, Mich., September 1, 1882. Mr. Denis T. Eyan, of Detroit, made the following statement: I am engaged with my brother in the manufacture of knit goods. We employ about 600 hands. The existing duties are 50 per cent, on wool, and 35 per cent, on knit goods. We would like to have the for- mer duty abolished, and the latter cut down to 17 J per cent. As it is now our only market is in this country. We cannot send goods into Canada at all. If the duty on wool were removed the article which we now sell at $4 we could sell at $3, and we could then find a market in Ontario, Quebec, and Manitoba. We are able to meet competition in the particular class of goods that we make, and we do not ask any pro- tection or any favor except to be allowed to buy our yarn and stuff in the cheapest market. And we are willing to give to other people the same privileges that we ask for ourselves. k The President. You want no protection on your goods ? The Witness. We would like from 15 to 17£ per cent, on goods and let the wool come in free. The President. Why should not the wool-grower have protection as well as you ? The Witness. We are satisfied to let the goods come in free of duty, if we can have the wool also free. AQUILA JONfiS. I STEEL AND IRON RAILS. 855 AQUILA JONES. Indianapolis, Ind., September 2, 1882. Mr. Aquila Jones, representing the Indianapolis Rolling Mills, ad- dressed the Commission as follows : Onr mills were established in 1857 for making iron rails, and have been running almost continuously ever since. We have managed all the while to pay our debts, and have made some money, but not much. Up to the present time we have made only iron rails, but we are now arranging to make steel rails from blooms. By Commissioner Oliver : Question. The present duty on iron rails is $15.75 a ton?— Answer Yes, sir. Q. Can that duty be reduced with safety to your interests ?— A. It can- not. E very time that the price of rails drops we lose money. We have not made money this year. Sometimes we make money, and then again we lose it. Last year we made money; this year we iose money. We are arranging, as I said, to make steel rails from blooms, but at present prices we could not do so, if we had our mill ready, and make money. Q. What reason can you give for that?— A. Prices of rails are too low. Steel rails are only worth $45 a ton, and we have to pay $36 for blooms m New York, and pay the freight on them to our mills. Q. What are iron rails worth?— A. We are trying to get $42 for them, but we cannot always get it. We have had to sell them at a loss. Q. Where is your market, mainly ?— A. The railroads coming in here give us mainly all the work that we have to do. We are making rails to-day to go to Holly Springs, Miss. • 9,1 l b nX do the wa £ es whic h y° u P a y compare with the wages paid in the States east of you— Pennsylvania, for example ?— A. I think our wages are a little higher than theirs. At any rate, we have had no trouble with our laborers. Things have gone on without a jar in our mills, but I think we are paying rather more than we ought to pay. We could not get our wages down without trouble. Q. Ho you mean to roll steel rails from blooms, or to put up convert- ers?— A. We have arranged our building to put up converters, but fbr the time being we thought we would restrict ourselves to making rails from blooms. Q. The reason of your not making money; is it not because iron rails are not used any more?— A. There has not been much demand for iron rails lately, but the price that we have to pay for the old rails is too hi«h compared with the price that we get for the new rails. Q. You have been holding to the making of an article which is not wanted Iron rails have become obsolete.— A. There is a demand for !ron rails, but the price is too low. There is hardly a day that we have not offers for rails, but we cannot afford to make them at the prices Q. Why do railroad companies use iron rails at $42 when thev can f n teel 8 $ 45 •— A - 1 do not kn ow that I can answer that question to the satisfaction of everybody, but there are some railroad men who rails ^ 0n a nrotection, potteries would spring up almost everywhere, and every piece of ware used for the rich or the poor man’s table could be made here — the fine as well as the common ware. By Commissioner Boteler : Q. You think, although it would be to your present interest to have this restrictive duty on the raw material removed, yet in the long run it would be detrimental to your interest? — A. Yes, sir. Q. It would make us dependent on the foreign producer? — A. Yes, sir. Q. And the foreigner, taking advantage of that and having us in his power, would put up the price of his material? — A. Yes, sir; as they have always done and will do to-morrow if they have an opportunity. I think it would be wrong in principle to legislate in such a way that our mines here would be closed up and we should be left entirely dependent upon the foreign production. In Missouri we own a flint bank 50 feet high of decomposed flint. Then we own another clay bank where we have dug through tbe clay for G4 feet and have not got to the bottom. How deep it is we do not know, but I think if we should allow this material to lie there and throw ourselves into the hands of our enemies, the foreign producers, it would be suicidal. GEORGE SCOTT.] EARTHENWARE. 871 GEORGE SCOTT. Cincinnati, Ohio, September 4, 1882. Mr. George Scott, of Cincinnati, manufacturer of pottery, made the following statement: I have been engaged in carrying on a pottery in Cincinnati ever since 1845, and have had a great deal of experience in all branches of the business. There are certain classes of goods that will craze or there must be a change in their color ; for instance, yellow ware, if it gets a hard burning that will prevent it from crazing, will not be yellow ware any more, but a kind of a blue-tinted ware. If you burn it hard to get that blue tint, it will not craze anywhere. But there is always more or less crazed ware, and must of necessity be. Certain parts of the kiln cannot get enough heat to prevent their crazing. But with a proper mixture of various bodies of ware, such as white granite, C.C.’s, stone porcelain, china, &c., with a proper attention to mixing and sufficient fire, there will not be a great deal of crazing, although there is always a liability of having some portion of the ware crazed. I do not believe there is a manufacturer in the world who can conscientiously say that he has never had crazed ware. All manufacturers have more or less crazed ware. In the West, here, we have been able to make better goods than they have in the East, on account of the materials used. The Western materials, as a rule, are much finer than those used in the East, and we are not liable to have much crazed ware in Cin- cinnati and East Liverpool for that reason. I have been manufacturing white granite and C.C. goods four years last August. It has been cus- tomary with all potters to a\low a reduction for crazed ware, and the jobbers and dealers have been in the habit of getting crazed ware for nothing, not allowing anything for it, while at the same time they would sell it to their customers. I adopted a different course in this respect. I did not think it was honest that it should be sold to the people if it was not paid for by the jobber, and I made a rule that I would not guar- antee or warrant my ware not to craze; but I said to them: “Gentle- men, if you buy my ware and it crazes on your hands, I will take it back at my cost. It shall cost you nothing for freight either way.” With that understanding, and working under that rule, I have never paid one dollar during the four years for crazed ware. I have never had but three dozen ice-cream dishes and one punch bowl returned to me on that account during the whole four years. You can make inquiry anywhere in the country, and people will tell you that my ware stands as good as any they have ever seen. There has been a great deal of ware made in this country by people whom I call amateur potters. When the potters were getting high prices for their goods, during the war, of course it stimulated the business, and capitalists went into it, thinking there was a bonanza in the business, and employed what I call amateur potters to manage the business for them. Of course, they met w ith great losses, and turned out some very poor work and over-burned goods, because they did not have the skill necessary to conduct business. But those who understand the business, probably, have not suffered so much from crazed ware as inexperienced persons have. 872 TARIFF COMMISSION. [GEORGE SCOTT. By Commissioner Porter : Question. How many years have you been interested in the pottery business ! — Answer. I have been engaged in the business in Cincinnati since 1845. Q. Is it a fact that during the last thirty years wages in England have increased 40 per cent, in the potteries ! — A. No, sir. Q. Would you consider that statement the truth, so far as your observation is concerned ! — A. I know positively that they have not, and I should consider such a statement as very incorrect. Q. Should you also say that during the corresponding time wages in this country have decreased 30 per cent. ; what would you think of such a statement! — A. I know they have not decreased that much. Before the war the wages paid in Cincinnati were $1.25 a day; when the war commenced, wages paid in x>otteries never went up as high as they did in other branches of business, because at that time it was done on a very small scale. The pottery industry was not developed hardly in 1860. There was but one pottery in the United States then, which, I believe, was making white ware, and was situated at Jersey City. There were quite a number of yellow-ware potteries in existence up to that time throughout the country, but the yellow-ware business, although it requires skill to conduct it, is different from the manufacture of white ware. When the war commenced and the premium on gold went up, it gave more or less stimulus to the business and they got very good prices for their work, and wages went up in a corresponding degree. Q. You are quite sure that the wages did not decrease during that period ! — A. Yes, sir ; and they have only decreased about 10 per cent, since the war. Q. Were the wages paid the workmen in potteries higher in 1858 or 1859 than they are now! — A. No, sir; not so high. We were paying $1.25 then, and we are paying $2.25 to $2.50 now. Q. Then the statement made that wages in the pottery business have decreased since the war is not correct ! — A. No, sir ; it is not correct. At one time during the war, when gold was very high, wages increased to $2.50 and $3, and since then there has been a decrease of 10 per cent, only from that highest period. Q. Speaking from your experience as a manufacturer for over thirty years, you feel quite sure that wages have not increased in England 40 per cent, during the period of time spoken of! — A. No, sir; they have increased a little, but they have not increased 40 percent.; 1 am willing to swear to that. 1 get letters from my relatives who live near the Staffordshire potteries, and I have visits from them. One paid me a visit last year, and in that way I know what the prices are there. I have imported fourteen workmen from there in the last two years, and 1 know what they were getting paid in Staffordsire. W. S. SAMPSON, JR.] EARTHENWARE. 873 W. S. SAMPSON, Jr. Cincinnati, Ohio, September 4, 1882. Mr. W. S. Sampson, Jr., of Cincinnati, Ohio, secretary and treasurer of the Tempest, Brockmann and Sampson Pottery Company, made the following statement : Gentlemen: Being connected with a business for which, unfortu- nately, the protection afforded by the jiresent tariff is utterly inadequate, we desire in a few words to present our reasons why a higher duty should be imposed. First, in our business, machinery can be used to but a very limited extent, labor being the chief part of the cost of production, or, say, over 90 per cent. The materials used are valueless for any pur- pose until labor is applied, and for that labor we pay more than double the price that England, our principal competitor, does tor work of like character. All the material used by us with the exception of not over one- quarter of one per cent, is the product of American sldll and labor. Work- ing potters in this country are paid no more, and in many cases less, than is paid to those employed in other branches of skilled labor, but unless the present duty is increased their wages must be reduced, de- grading and not elevating labor — a change for which the people are not prepared, and which we would be very sorry to see. Our industry would never have obtained a footing in the United States had it not been that the high prices of gold during the rebellion afforded additional protection, and also that there was a demand at remunerative prices for all that could be produced, even that which would now be thrown upon the dump pile finding ready sale. Had this state of things continued, no change would have been necessary and none would have been asked. That the increase of duties would be borne by the foreign producer is proved by the fact that our wares, with the present duties of 40 per cent., are lower than they were before the war, with a 24 per cent. duty. To us the ad valorem system, holding out, as it does, a premium to fraud, is disastrous. For instance, into the port of Cincinnati, in the year 1878, 2,972 crates of earthenware were imported, dwindling down to 1,078 crates in 1881 and to 230 crates in the first three months of the present year, and this not because fewer goods have been imported, for the reverse is the case, but for the reason given by a prominent im- porter and jobber that they could buy cheaper from manufacturers’ agents in New York City, notwithstanding the brokerage and other ex- penses there, from whicli they would be relieved wlieu goods are im- ported direct, by reason of being able to give these matters their personal attention. The amount of seconds and thirds turned out in any estab- lished pottery should not exceed at the outside 25 per cent., yet of all the earthenware imported into the country, the per cent, of firsts is nom- inal. There is evidently a screw loose somewhere. To guard against the evils resulting from this state of things we should deem a mixed specific and ad valorem duty necessary, the ad valorem principle being employed only to an extent sufficient to rectify any injustice resulting from the heavier duties that might be imposed upon the cheaper and bulkier grades of ware if a purely specific duty only were used. 874 TARIFF COMMISSION. [W. S. SAMPSON, JE. With additional protection, and the feeling that the interest would not be liable to be disturbed at any and every session of Congress, our industry would be firmly established ; improvements in the manufacture of our wares and in the manipulation of the raw material would greatly cheapen the product, and the consumer would thus be benefited. Without this, we shall be driven to the wall ; the foreign producers will have a clear field, and as there are not any philanthropists in business at least, you can see that they will speedily strive to replenish their pockets, re- duced by the competition of American potters. If the Commission desires to ask any questions concerning the prac- tical workings of the business, our Mr. Tempest is present and will be happy to reply to them. W. G. UYNDMAN.j SHEET-IRON ROOFING. 875 W. G. HINDMAN. Cincinnati, Ohio, September, 4 , 1882. Mr. W. G. Hyndman, of the firm of W. G. Hyndman & Co., of Cin- cinnati, Ohio, manufacturers of sheet-iron roofing, made the following statement: Gentlemen : As manufacturers of sheet-iron roofing, a purely Ameri- can industry, consuming thousands of tons of home-made sheet iron annually, we daily meet ruinous competition from tin roofing made from tin plates which are manufactured altogether in England. This ruinous competition is due solely to the fact that the present tariff laws discriminate very materially in favor of tin plates (iron plates tinned) as against other classes of sheet iron. This discrimination has already killed the tin-plate industry of this country, and will eventually ruin the rapidly-growing manufacture of sheet iron into roofing unless relief is speedily procured. 1 therefore beg leave to call your attention to the following unjust discriminations of the present tariff* laws : First. Tin plates are admitted at a rate of 1.1 cents per pound, with- out regard to value, all grades being classed as tin plates. Sheet iron has three classes : No. 20 wire gauge and under, 1J cents per pound ; over No. 20, and not above No. 25, 1£ cents per pound; over No. 25, If cents per pouud. Second. The sheet iron from w T hich tin plate is made, being of lighter gauge than No. 25, would, if imported as sheet iron, pay a duty of If cents per pound ; but notwithstanding the fact that these sheets are coated with tin, and their value thereby doubled, they are admitted at a duty of 1.1 cents per pound, or 65 cents per 100 pounds less than common sheet iron of the same thickness and one-half the value. Third. Tin plates worth in Liverpool cents per pound, pay a duty of 1.1 cents per pound or 24 per cent, ad valorem ; while sheet iron, worth in Liverpool 2f cents per pound, pays a duty of If cents per pound or 77 per cent, ad valorem ; that is, common sheet iron pays more than three times the duty on tin plates. Fourth. Galvanized sheet iron, which is nothing more than black sheet iron coated with zinc, pays a duty of 2J cents per pound, while tin plate, black sheet iron coated with tin, pays a duty of only 1.1 cents per pound ; being a discrimination iu favor of an article coated with tin, in preiereuce to one coated with zinc, of 1.4 cents per pound. Fifth. Sheet-iron roofing, worth in Liverpool $3 per 100 pounds, is ad- mitted into this country (under the “not otherwise provided for” clause) at a rate of 35 per cent, ad valorem or $1.05 per 100 pounds, while the sheet iron from which it is made, if imported, would pay a duty of $1.75 per 100 pounds, making a difference of 70 cents per 100 pounds in favor of manufacturing in Liverpool. There was imported into this country, for the year ending June, 1881, (see report Bureau of Statistics), 190,000 tons of tin plate, every pound of which could have been made in this country. Block tin being im- ported free of duty, there has been established in this country several large rolling-mills for the manufacture of tin plates; but these, after a long struggle for existence, have been compelled to close on account of 876 TARIFF COMMISSION. \ [W. G. HYNDMAN. the inadequate protection afforded them, and thus millions of dollars which might have been spent in labor in this country have gone to Eng- land. On the other hand, the manufacture of galvanized iron, under the present tariff, being properly protected (duty cents per pound), has grown to immense proportions, and the importation in 1881 was re- duced to 180 tons. In view of these facts, we believe that all sheet iron, tin plate, gal- vanized iron, and all manufactured articles of which these are the com- ponent j>arts of chief value, should pay a uniform ad valorem rate of duty, and such rate should be high enough to properly remunerate both laborers and manufacturers. I hope these points may have your earnest consideration, and that your report may embody a recommendation for the correction of these discriminations and the establishing of a uniform ad valorem rate of duty on all the articles mentioned. By Commissioner Oliver: Question. Your recommendation is that a uniform ad valorem rate of duty be imposed? — Answer. Yes, sir; because we think there is no other way of establishing a fair rate of duty. Q. Could not a specific duty of so much a pound, ranging from a low rate for the common iron to a higher rate for the better quality and the tinned, be imposed? — A. Yes, sir; that could be done, I suppose. Q. You state that roofing iron is made in Liverpool and brought to this country. Has there been much of that imported, and if so, for how long a time? — A. A firm of this city have moved their machinery to England, and they are manufacturing this year probably from 350,000 to 400,000 tons, which they are now importing here under the 35 per cent, ad valorem rate. Q. That makes the duty about 1 cent a pound? — A. About $1.05 a hundred pounds, while the sheet iron from which it is made pays a duty of $1.75 a hundred. Q. This firm take the English iron and finish it in Liverpool? — A. Yes, sir. Q. How much work is put on it there? — A. It costs 50 to 75 cents a hundred pounds to make it there. Q. Do you include in that the corrugated iron? — A. Yes, sir; that is included. Q. And the manufacturers here send to Liverpool and have it made and bring in the finished article at an ad valorem rate of 35 per cent., making the duty about 1 cent a pound, when the material out of which roofing-iron is made would pay what rate of duty? — A. The sheet iron from which it is made pays If cents a pound duty. Q* The effect of that is to make the rate lower on the finished article that you are making, than on the material of which it is made? — A. Yes, sir. This party I spoke of has sent circulars out through the coun- try offering to sell the manufactured iron at about 55 cents a square of 80 pounds, or less than the manufacturers can make itvlor here. Cin- cinnati uses perhaps 0,000 or 7,000 tons of sheet iron, for this purpose alone each year. Q. Is the practice of putting on iron roofs increasing? — A. Yes, sir; it is increasing. I have been in the business for the last seven years. The first year we used about 50 tons of sheet iron, but for the last year the amount of iron used in Cincinnati for roofing purposes must be some- where in the neighborhood of 12,000 or 15,000 tons. \Y. G. HYNDMAN-1 SHEET-IRON ROOFING. 877 By Commissioner Kenner: Q. This iron roofing that you refer to is the plain iron roofing, with- out any additional preparation to increase its durability? — A. We take the plain iron and it is trimmed straight on the edges ; the edges are then turned up and it is painted with linseed oil and iron-ore paint as a cover, and packed and shipped. Q. There is no other preparation of it except being painted in the way you have mentioned? — A. The edges are crimped also. Q. But I mean, is anything else done to add to its durability? — A. Ho, sir; the durability of the iron is secured by the use of this iron-ore paint, which is mixed with the linseed oil. Q. How long has that description of roofing been known to last? — A. I know an instance in Madison, Iowa, where it has been on for 30 years and is still good. It has been repainted, of course. By the President : Q. It is painted with ocher or oxide of iron? — A. Yes, sir. By Commissioner KenTSer: Q. Does it require to be painted frequently? — A. As often as you would paint a tin roof — every three or four years. Q. Is it liable to be affected by the heat of the sun or by cold ; the heat of the sun expanding it and the cold contracting it? — A. Ho, sir; that is obviated by the crimping. It is not like tin, which is soldered together. The iron is loose, and where it laps together it is allowed to give. Q. What is the cost of a roof of that kind per square? — A. It is now selling at the factory at from $4.75 to $5 a square. Q. What is the cost of putting it on? — A. Twenty-five to 50 cents, according to the description of the roof. Q. Then the total cost is not over $6 a square when it is put on? — A. No, sir. By Commissioner Oliver : Q. What number iron do you generally use ?— A. Ho. 26 gauge, usu- ally. Q. Isn’t that rather light? — A. Yes, sir; that is a light iron, but that is commonly used. For warehouses and such places we use heavier- iron. By Commissioner McMahon: Q. The same differences have existed since the passage of the original act of 1864, between iron in sheets and iron when painted in sheets. The duty now on tinned iron is less than the duty on the sheets of which the tin plates are made. Has that been the case all the time? — A. If I understand the matter, when the law was first framed it contemplated 2J cents a pound duty — the original tariff law — and that duty was col- lected for some time. Then there was a decision from the Secretary of the Treasury which reduced the rate to 1-^ cents per pound by plac- ing a comma mark between the words “tin” and “ plates.” That existed until February, 1875, when Congress passed a law making tin plates pay a duty of 1-^ cents a pound. I think the original law contem- plated a duty of 2J cents a pound on tin plates. Commissioner McMahon. That decision you refer to was made July 22, 1864, and that held until the 6th of June, 1872, when tin plates, sheets, &c., were made to pay an ad valorem duty of fift< en per centum. Then, in 1875, they were put at 1^ cents a pound. So that your com- 878 TARIFF COMMISSION. [W. G. HYNDMAJS. plaint, it seems to me, must have gone back to 1872, ten years ago. Did you oppose the passage of this act of 1875? — A. No, sir; I had nothing to do with the iron-roofing business at that time. Commissioner Oliver. The point you make is that you cannot see the reason for putting tin plates at l^ cents a pound duty, and putting the iron out of which they are made at If cents a pound ? The Witness. Yes, sir. Commissioner McMahon. I understand that perfectly ; but Congress had all those facts before it at the time. Tin plates were paying a duty of fifteen per centum ad valorem in 1872, and the iron of which the tin is made was paying the same rate of duty that it now pays of 1J and If cents a pound. Then Congress took up tin plates in a special act and put them at T^ cents a pound, or at the lowest rate of duty then put on iron. Were the tin-plate manufacturers in existence at the date of the passage of the act of 1875 ? — A. Yes, sir ; I think so. Q. Do you know if they placed their case before Congress ? — A. I think so. I have been so informed. SCOTT & CO.] SHEET-IRON ROOFING. 879 SCOTT & CO. Cincinnati, Ohio, September 5, 1882. Messrs. Scott & Co., of Cincinnati, manufacturers of sheet-iron roof- ing, submitted the following statement in regard to specific duties on black and galvanized sheet iron, tin plates, &c. : Gentlemen of the Tariff Commission: Referring to the report of the Treasury Department, of home consumption and imports on im- ported merchandise entered for consumption in the United States, with rates of duty and amounts of duty collected for the fiscal year ending June 30, 1881, prepared by Joseph Mmmo,jr., Chief of the Bureau of Statistics, Washington, D. C., the following comparisons of specific and ad valorem duties appear: Galvanized sheet iron, 2J cents per pound specific, about 44 per cent, ad valorem. Tinned sheet-iron plates, commercially known as tin plates, 1.1 cents per pound specific, about 28 per cent, ad valorem. Black taggers’ sheet iron (rolled almost as thin as paper), 30 per cent, ad valorem. Black sheet iron, No. 26 gauge, If cents per pound spe- cific, equal to about 51 per cent, ad valorem. These importations of black sheet iron referred to are made up chiefly of the higher grades, the common grades of greatest consumption being almost excluded, as the tariff on that class of material approximates 80 per cent, ad valorem. Comparison of prices at the average dutiable talue on black sheet-iron importations for 1881 being $3.40 per 100 pounds, and common sheet being worth at the same time about $2 per 100 pounds, shows clearly that but little of the lower grades has been imported for the reasons assigned. Importations ending June 30, 1881, of black sheet iron thinner than No. 25, amounted to less than 500 tons at If cents per pound duty, and importations of tin plates about 190,000 tons, fully one-half of which is used for tin roofing. We take No. 26 gauge for comparison as the gauge for practical use, that is nearest to the lighter (No. 32) gauge of tin plate, which discriminates in favor of the latter, as the lighter gauges are more expensive. Pig iron is assessed at $7 per ton, equal to 34 per cent, ad valorem. Tin plates, or tinned sheet-iron plates, are therefore admitted not only at the lowest ad valorem rate, but likewise at the lowest specific rate, excepting pig iron. It is the most costly material, and involves a higher proportionate expenditure of labor, in all its details, than all other grades of sheet iron mentioned. The sheet iron forming its component part of chief value is, principally, a high grade of charcoal iron of the lighter and more expensive gauges, and, taken in connection with the supplemental process of tinning and handling in small sheets, represents a maximum of labor production at the lowest rate of duty as compared with other sheet iron. Tin plate being the highest-priced article and the most expensive in its production pays 16 per cent, less duty than galvanized sheet iron; 2 per cent, less duty than black taggers’; 6 per cent, less duty than pig iron of common quality ; 23 per cent, less duty than high-priced No. 26 black sheet iron, and about 52 per cent, less duty than common sheet iron of general use for stove pipes, stove fur- 880 TARIFF COMMISSION. [SCOTT & CO. nishing, roofing and siding of buildings, &e. Sheet iron of the grade and quality used in the manufacture of sheet-iron roofing and siding, under our present specific duty, can be imported only in limited quan- tities and at rare intervals, as the specific duty of If cents per pound increases the ad valorem rate to nearly 80 per cent. The manufacturing interest of sheet-iron roofing is thus brought to compete with tin roofing made from charcoal sheet-iron tinned plates, known to commerce as u tin plates,” which is directly aided and fostered by legislation in the payment of 50 per cent, less duties than common black sheet iron that forms the basis of sheet-iron roofing. The aid of the government is thus invoked to create a monopoly of tin roofing, to the destruction of a healthy competition, and in the prostration of an important manu- facturing industry, which could hold its own if the same ad valorem or specific duties proportionate to cost of production applied to both. Tin roofing (the product of tin plates or tinned iron plates) is the foreign article. Sheet-iron roofing is the home article, and legislation is and has been directed for more than twenty years toward the de- struction of sheet-iron roofing industries by building up a monopoly in tin roofing. We have been sometimes met by the suggestion that this duty on tin plates does not affect general interests, and more especially the interest of its own manufacture in the United States ; that it is not made in this country to any considerable extent, and is not one of our pro- ducts. In considering this view the fact is lost sight of that the com- ponent part of chief value of tin plates is sheet iron ; that it is only sheet iron coated with tin ; its basis is sheet iron, which cannot be made in the United States, as it is permitted to enter the country under the guise of tin plates. Is it a matter of surprise and conjecture that the manufacture of tin plates is not entered into more largely in America when the manufacture of sheet iron that forms their basis cannot be made on account of discriminating duties'? The tariff largely regulates prices of labor. When labor conforms to a level of 75 to 80 per cent, on common sheet iron, it cannot be profit- ably employed in the manufacture of a higher rate of sheet iron (re- quiring more labor) at 50 per cent, less duty. As the duty regulates prices of labor, it must therefore be conclusive that when fixed on the higher rate it prevents production at the lower rate. Equalize the duty on each in proportion to value and cost, and the manufacture of tin plates or tinned-iron plates will become one of our large industries. Tin ore can be imported here as cheaply as in Great Britain. As heretofore stated, tinned iron plates, known on the market as* tin plates, being largely used for roofing, appear as our most formidable competitor, against which we cannot contend with equal show for suc- cess. We meet it in opposition everywhere, and if not supported by an unequalized tariff, but placed ou the same equal plane with us, we could meet tin roofing successfully and favor the public with a cheaper and better material for roofing purposes. Tin plates, such as used for loot- ing purposes, are now dutiable at one and one-tenth of a cent per pound, ranging from 17 to 22 per cent, ad valorem, based on prices of material obtained in Staffordshire, England (as hereinafter shown), during 1881, while common sheet iron at the same time was assessed at 77 per cent, ad valorem on 1^ cents per pound specific duty. In reference to duty on tin plate, note IleyPs Tariff, schedule of duties, page 70, referring to clause 1050, page 1G0, also clause 788, page 129, also page 59, clause 335, wherein the latter clause refers to the interpretation at the bottom of the page, ruling that tin plates must be galvanized before a duty of 2i cents per pound shall prevail, thus providing for their admission at scorr & co.l SHEET-IRON ROOFING. 881 1.1 cents per pound, whereas common sheet iron (a much less expensive material) is assessed If cents per pound — a direct interpretation in favor of one industry to the detriment and injury of another. We refer you now to the following prices received during December, 1881, from Staffordshire, on tin plates and common sheet iron, which is a fair criterion of comparative prices and which will obtain generally: Large-sized sheets of tin plate-s, No. 20 gauge (size and gauge of com- mon iron that we use for roofing), are quoted at 30 shillings per cwt., 112 pounds, equaling $0.51 per 100 pounds; at the present duty of 1^ cents per pound on tin plate, the ad valorem would be about 17 per cent. ; at 2£ cents per pound, 39 per cent, ad valorem. I. C. charcoal is quoted at 25 shillings per box (120 pounds), duty 22 per cent, ad valorem at 1^ cents per pound, and 50 per cent, ad valorem at 2J cents per pound. At the time named, common sheet iron, such as we use, could be ob- tained in Great Britain at $2.25 per 100 pounds, duty If cents per pound, 77 per cent, ad valorem. Transportation to central points like Pittsburgh and Cincinnati, 25 per cent, additional, increasing the cost to more than 100 per cent, over European prices. You will please note that tin plate, at 1-iV cents per pound duty, is admitted at from 58 per cent, to 00 per cent, less ad valorem, and at 2J cents per pound duty at from 27 per cent, to 35 per cent, less ad valorem duty than common sheet iron. We desire to add that the foregoing estimates are based only on the reports of the Bureau of Statistics, which shows, according to importations, that galvanized iron comes in on a 44 per cent, ad valorem rate. This estimate will not thoroughly apply to the facts at issue. Galvanized iron in Great Britain is now quoted from $2.84 to $4.42 per 100 pouuds, lowest to best quality. The ad valorem rate on a specific basis of 2J Gents per pound would rate from 56 to 87 per cent., averaging 72 per cent., being in excess of the rate charged on tin plate nearly 50 per cent. When labor strike curtails production at home to that extent as to force us to buy in the foreign market, we are met by the difference in duty alluded to, which operates disastrously against our business. Last season the five months’ strike in this vicinity (Cincinnati) was severe upon us, and now the great labor strike at Pittsburgh threatens results even more serious, forcing up prices to a prohibitory point, as compared to plate and tin roofing. We therefore request your honorable body to institute a comparison of ad valorem and specific rates as reported by the Bureau of Statistics, showing the relative application of duties the different classes of sheet and other iron bear to each other, and the percentage of taxation in proportion to value and labor expended as well as the relative prices we have named. Common grades of sheet iron, with a minimum of labor in their production, having the greatest consumptive demand, are met by unjust and burdensome legislation, which prevents the same opportu- nities for importation and foreign comiietition in supply that are granted to the higher grades as named, with the maximum of labor attached, by the disproportionate application of duties. These evils can only be eradicated by changing from a specific to the same ad valorem rate, or- determining the specific rates by the average dutiable value on all. It has been urged that frauds will occur under ad valorem methods; that false values and invoices will be made under sworn statements* thus depriving the governmentof revenue. This argument is far-fetched. It is well known that the law bears strongly on this point, and the pen- alty of confiscation, and perhaps imprisonment, for its violation is suffi- cient to deter any from adopting a course so hazardous. However much they might feel inclined, the prospect of gain is so small that such views H. Mis. 6 56 882 TARIFF COMMISSION. [SCOTT & CO. will not be entertained. Besides, the co operation of the foreign ship- pers will be required in swearing to false invoices (simply for the sake of a little gain to another), to which they will not become parties. Custom-house officials are able and efficient experts, and no great de- parture on values can escape their detection ; and should ad valorem methods require greater care on the part of the custom-house officials, it is not to be considered in connection with the great benefits that will be bestowed on the various industries by adopting them. We note a revision of the tariff is contemplated, and request your honorable body to report on all classes of sheet iron, embracing tin plates, galvanized sheet iron, black taggers’, &c., black sheet iron of all qualities and gauges, the same ad valorem rate of percentage that may be agreed upon as the basis of revenue taxation. As sheet-iron roofing manufacturers and others, we especially petition you to recommend that discriminating duties, which favor tin plate against black sheet iron, be removed. But should it be deemed advisable to continue specific duties on sheet iron, galvanized iron, tin plates, &c., we ask that specific rates may be so adjusted as to apply according to the value of the material and cost of labor and production, taking as a basis the same ad valorem rates on an average value of imports during the past three years and equal- izing the specific rates accordingly. Taking for computation tin plate at an average rate of 28 per cent, ad valorem, or cents per pound 5 specific and common black sheet iron a+ an average rate of 80 per cent, ad valorem, or If cents per pound specific for No. 26 (tin plate being about No. 32, a lighter and more expensive gauge), the equalization of specific rates should either raise the duty on tin plate to over 3 cents per pound specific, to equalize it with the iron at If cents per pound, or lower the duty on common black sheet iron to six-tenths of a cent per pound specific, to equalize it with tin plates at 1 ^ cents per pound. Scott & Co., Cincinnati. W. G. Hyndman & Co., Cincinnati. Porter Iron Roofing Co., Cincinnati. Eureka Iron Roofing Co., Cincinnati. Corrugating Iron Co., Cincinnati. Garry Iron Roofing Co., Cleveland, Ohio. T. C. Snyder & Co., Canton, Ohio. Edward E. Scribner, Saint Paul, Minn. Winslow Car Roofing Co., Cleveland, Ohio. JAMES II . LAWS.] LOUISIANA SUGAR. 883 JAMES H. LAWS. Cincinnati, Ohio, September 5, 1882. Mr. James H. Laws, of the firm of James H. Laws & Co., wholesale grocers and commission merchants, Cincinnati, Ohio, made the follow- ing statement: I desire to state that any change in the tariff which materially inter- feres with the production or distribution of the sugar of Louisiana will materially affect the interests of the entire South and West. It is a well- known fact that the raising of sugar-cane in Louisiana is an industry which needs all the encouragement we can give it, as there are but a very few months in the year when the crop can be grown and gathered ; and during that time its culture is often interfered with by changes in the weather, and the inability to command sufficient labor at the neces- sary time. So that if any obstruction is placed in the way of its culti- vation by interfering with the present tariff, and the price to be ob- tained is reduced, it would be impossible to raise a crop of sugar in Louisiana, or anywhere else in the South. At least one-third of the amount realized from the sugar crop of Louisiana is returned to the South in the form of machinery made at the North, while two-thirds of the amount is expended in labor. If there should be an interference by reason of tariff legislation with the conditions now existing, there is no other agricultural product that could be substituted in the place of sugar in those sections, especially in Louisiana, and the result would be that 200,000 or more people would be thrown out of employment; the sugar interest would be abandoned, and it would be a great loss, not only to the Southern States, but to the West, from which the South draws its supplies of food and machinery. We in the West and South- west, who have devoted ourselves to the handling of raw sugars, hope there will be no such interference, but that the Louisiana sugar interest may be carefully guarded and encouraged in any changes that the Com- mission ma^ recommend in the tariff laws. By Commissioner Kenner : Question. I believe you represent the grocers 7 interest, although I do not see your name attached to the papers which have been submitted. — Answer. I represent that interest. Q. Your business is that of wholesale grocer and handler of these products ? — A. Yes, sir. By Commissioner Oliver: Q. I would like to know what the feeling is among the business men of this city in regard to any radical changes in the present tariff laws; as to whether they are in favor of any radical changes in the revision of the tariff? — A. I think I may safely say that the general sentiment is that there should be no material interference with the present tariff laws in any respect. We have adapted ourselves to the rates of pro- tection we now enjoy, and think they had better remain as they are at present. 884 TARIFF COMMISSION. [JAMES H. LAWS. By the President : Q. What would be the effect of a material reduction of the tariff upon the stocks of goods which you have on hand? — A. That would depend very much upon the time of year, as regards the article of sugar. At the present time our stocks of sugar are very low. I am speaking wholly with reference to the grocery trade and the handlers and dis- tributers of groceries, and I think it is their desire that no radical changes should be made in the tariff. GEOKGE II. MCKEE.] HEMP, 885 GEORGE R. McKEE. Cincinnati, Ohio, September 5, 1882. Mr. George R. McKee, attorney-at-law, representing the Ken- tucky River Mills, of Frankfort, Ky., made the following statement : I desire to say a few words in regard to the duties on manila, sisal, and hemp. I do not come here as the representative of any particular class of manufacturers ; but I desire to make a statement of one or two facts within my own knowledge in regard to these articles. You are perhaps aware that the area devoted to the cultivation of hemp is lim- ited in this country, and one reason why I should like to see a perma- nent duty put on these articles is, so that the manufacturer of hemp in Kentucky, where I reside, can know with more certainty what the price of these products will be. The prices at present are variable. The farmer or the planter cannot raise the article at a profit if the price is less than $5 a hundredweight. It very frequently goes below that price, and again it gets up to a very high price, so that the manufac- turers cannot use it to advantage in competition with manila or sisal hemp. I am connected with a small manufactory in Kentucky which makes what is called binding twine, used for binding wheat and other grain. It is a new industry in the country. By Commissioner Oliver : Question. This binding twine takes the place of wire ? — Answer. Yes, sir j it is a substitute for wire, and it is manufactured of manila and also of hemp. The difficulty we encounter is in the variation of the tariff rates of duty. If there was a fixed duty on these articles of manila and sisal it would regulate, of course, the price of hemp. When- ever the price of hemp exceeds $7 or $8 a hundredweight it cannot come in competition with the manila or sisal. It can come in competition witli it if the price is between $5 and $G a hundredweight; $6 would be about the normal price for hemp. There is another view also to be taken of the case. If the duty on these articles was made perma- nent, the price of hemp would be more stable, the farmer would de- vote his time more exclusively to the cultivation of it, and would not change his crops so often. When it goes below $5, the farmer would not raise it at all, except for the fact that it is an article calculated to clear the ground for other crops ; it clears it of all extraneous sub- stances. In that way he is often induced to sow and raise hemp when he would not do it for the profit he gets from its sale. The cost of labor necessary to raise it is to some extent increased, and taking into consideration the cost of sowing the hemp, the price of the seed, the price of cutting it and preparing it for market, you can see that $5 will barely pay him to cultivate it. There is one other view of the case that might be taken. There was a process invented some years ago for what we call “rotting”; that is, detaching the fiber from the stalk. In Kentucky we mostly rot it by spreading it out and letting it lie on the ground until the rain or snow detaches the fiber. There was a process invented some years ago by which this could all be done by steam. Hemp is a cumbersome article, 886 TARIFF COMMISSION. [GEORGE R. MCKEE. and will not bear the expense of transportation in its natural condition. If there was such a duty placed upon the imported article as would in- sure the farmer a permanent price, it would be a great advantage to our country. I hope the Commission will excuse me for making these crude re- marks, for I have had no time for preparation, and I shall ask permis- sion to file a supplementary written statement. By Commissioner Kenner: Q. Do you know whether sisal or manila are grown in this country at all? — A. No sir. I think sisal is grown in Yucatan, principally; I do not think it is grown in the United States. Q. Do you know whether the attempt to grow it has ever been made here? — A. I do not think it has. Q. The general effect of the introduction of these two articles of sisal and manila into this country would be, probably, to destroy the culti- vation of hemp altogether ? — A. No, sir ; I do not think it would de- stroy it altogether, but it would have the effect of unsettling the prices so that the farmer would have no inducement to permanently devote himself to the cultivation of hemp ; and as the cultivation became more and more limited, of course the manufacturer would be dependent upon the foreign supply instead of being able to rely upon the home produc- tion. The binding twine which we manufacture is not made from manila mixed with sisal, but of hemp exclusively. By Commissioner Oliver : Q. I believe you are from Kentucky ? — A. Yes, sir. Q. Does Kentucky produce a large amount of hemp ? — A. Yes, sir ; I believe as much or more than any other State in the Union. Q. More than Missouri ? — A. I think it does. There is but one other manufactory of any note of the kind I speak of in this country except our own, and that is located in Pennsylvania, not far from Pittsburgh. The industry is in its infancy. Q. Is this twine you speak of superseding the use of wire for bind- ing? — A. Yes, sir. It has been found that the wire used for binding- mixes with the straw and unfits it for use as food for animals. That was one of the principal reasons for discontinuing the use of wire. By Commissioner Porter : Q. Do you know how much hemp is grown in the United States ? — A. I am not prepared to give the statistics at the present time. Q. You do not know the value of the product or the amount of the yield ? — A. No, sir ; I do not. SAMUEL R. REED.] PROTECTION AND THE WORKMAN. 887 SAMUEL ROCKWELL EEED. * Cincinnati, Ohio, September 5, 1882. Mr. Samuel Bockwell Reed, of Cincinnati, addressed the Coin mission as follows: I liave the honor to present, briefly, a view of the relation of the work- man to a protective tariff. I assume it to be granted that the object of a protective tariff is to add to the price of the home article the amount of the duty, in consid- eration of higher wages to American workmen. As labor is the chief element of cost in all production, and as skilled labor is higher than unskilled, it is plain that the protective duty must be in ratio to the degree and quality of the labor. If a protective duty be laid on materials, then a higher duty in pro- portion to the greater amount and higher skill of the work must be laid on the articles made from such materials, in order to give the man ufacturer his fair protection. The protective duty does not begin to work to the manufacturer until it has risen above the duty on materials. Thus, if the duty on materials be 20 per cent, and on manufactures 30 per cent., the real protective duty to the manufacturer is 10 per cent., although it sounds like 30. If 20 per cent, be a judicious tariff on materials, 10 percent, is an insig- nificant protection on manufactures; yet on top of the other it sounds like the large protection of 30 per cent. If the duty on the product be twice as high as on materials, still it makes no allowance for the greater amount and higher quality of the labor. If the duty on materials is 20 per cent., and on products 50 per cent., then the manufacturer’s protection is 30 per cent., and the allowance for the greater amount and higher skill of the work, over that in crude materials, is 10 per cent. This does not seem large, yet by this the protective duty has got up to 50 per cent., which does seem large. When a protective tariff founds itself on a duty on materials, it be- comes at this one step a tariff of high range. If, for example, 30 per cent, be deemed a judicious tariff on materials such as iron, steel, copper, lead, tin, leather, wool, wood, dyes, chemicals, and so on, it is plain that accord- ing to this ratio a compensating and fair protection on the articles pro- duced from these materials, and requiring a higher degree and kind of labor, must be as high as 70 per cent. And this high rate allows only 10 per cent, protection for the greater amount and higher skill of the work on the manufactured article. This is the main principle of a pro- tective tariff, and this gives an idea of the way in which a tariff of high duties may be so wrongly adjusted as to work the reverse of protectively, and to stimulate instead of restrict importations of manufactured goods. It is rational that the manufacturer should desire free trade in mate- rials ; but he has to consent to give compensation for his own protec- tion, in protective duties on materials. If he gives more, in effect, than he gets, he suffers by the protective tariff. The primary object of a protective tariff is not to get a revenue from imports, but to keep out the foreign article, and to enable our manufact- 888 TARIFF COMMISSION. [SAMUEL R. REED. nrers to add to tlieir prices the amount of the duty aud of the charges of importation. The object is to make high prices to the consumer of our manufactures, in order to pay high wages. But the fact that the work- man is the consumer of our manufactures makes necessary, in framing a judicious tariff, to consider its operation on him. They make an error who theorize upon the idea that people are divided into producers and consumers. The producers are the consumers. In general, workmen consume to the full amount of their wages. The most thrifty save but a narrow margin. And their consumption is in the thing^vhose price is raised by protection. Our protective tariff has continually grown, and it now reaches directly or indirectly all the articles of the workman’s consumption. In general, the duties are higher ou the fabrics of common use than on those of finer texture. Bread and meat form but a small part of the family expenditure; but if we deny that the producer of these and of other home articles of food gets higher prices because of protection, we concede that the protective tariff robs the farmer in making him pay protection prices and giving him no compensation. The workman pays the high prices laid on home and imported articles by protective duties. If he gets higher wages by protection, on the one hand, he lays them out, on the other hand, in the higher prices which protection gives to all that lie consumes. If the higher wages are equivalent to the higher cost of living, the workman comes out even. If the increase of wages is greater than in the cost of consumption, then the workman gains by protection. If the increase of wages by protection is greater than the protective duty, then the manufacturer loses by protection. If the protective tariff increases the cost of consumption more than it raises wages, then the workman loses by protection. Among these practicabilities, it is quite practicable that — to use the cant phrase — protection may not protect, even with an extreme height of duties. It is also quite practicable that its unequal raising of home prices may unwholesomely stimulate importations. Our country is. not unacquainted with these untoward workings of a protective tariff. This gives au idea that a protective tariff is a very complex affair, which can- not be dispatched unthinkingly, off-hand, by the catch words of “free trade” or “tariff for revenue only,” nor even by an intelligent concep- tion of general principles, without knowledge of business details, and that even the most fervent belief in the beneficence of protection may^ not of itself qualify a man to frame a tariff which will work protectively. It shows also that when we lay a tariff on materials, the whole struct- ure of protection on manufactures must be put on top of that, and that this necessarily r brings it to high figures. But whatever the benefit of protection in the home market, the fact that its object is to increase the cost of production of manufactured goods limits their market to our own country. It cuts off our manu- factures from the markets of the world, and this limitation restricts also their consumption of the materials which we produce, as well as of such as we do not produce. This is, and must continue to be, its operation ; for it is not to be sup- posed that the outcome of protection is to be free-trade wages, to enable us to compete with British manufacturers in foreign markets. Two-thirds or three-quarters of the people of the world are in such a state as to offer a market for the products of the skilled labor and labor- saving machinery of civilization. The American people have great me- SAMUEL It. REED.] PROTECTION AND THE WORKMAN. 889 chanical genius and aptitude, and if they do not possess their share of this held, it is a subject for the investigation of statesmen. If, besides this, we but partly possess our own market with the products of labor- saving machinery, the need of inquiry is the greater. We must also accept the benefit of the high prices of protection, at the cost of the extinction of the shipping industry in all the free car- rying trade. As to the simple-minded remedy of free importation of ships, which many recommend as the way to restore our shipping, the same high wages and high cost of consumption which make us unable to build ships in competition with the British, would make us unable to run them if we had imported them free. And free trade in ships would give up our coast trade to foreign-built ships, and all the ship- building which is now created by that large trade. Is not all this a counsel of moderation in the rates of a protective tariff, as well as of care and discrimination in their adjustment i Does it not counsel a reduction in the number of articles embraced in the tariff', and in general a release of materials, and a pretty liberal con- struction of the somewhat indefinite term, materials'? Does it not counsel in general a return toward the tariff' as it was before it was crudely made a drag-net under the pressure of war expenses and cur- rency inflation ? The policy of protection professes to consider in chief the workman. The workman is the consumer of the articles whose price is raised by protection. There is much reason for a thorough investigation and reform of the tariff'; but great and sudden changes should be avoided, even if they are certainly in the right direction ; for they all disturb business and revenue. The enormous amount of our importation of manufactured goods, particularly of the goods of universal consumption, and of labor-saving machinery, which should be made in our country, although we have a tariff* greatly higher and more comprehensive than the fathers of the American system ever thought of; the circumstance that the higher the duty the greater the apparent need of the manufactures for more; the shrinking of our exports of manufactures, and their altogether in- significant proportions, in comparison with the enormous expansion of those of Great Britain in the last twenty years; the extinction of our ocean shipping; the general discontent of workmen; the small balance which high prices on all that he has to buy leaves to the farmer; these and other symptoms, in .the face of that which is supposed to be a high protective tariff, suggest that something is radically wrong. Perhaps the tariff is not all. Perhaps currency inflation is doing its share of disturbance. But there is enough to make the belief that there is not before the American people so important an affair as that which this Commission is investigating. 800 TARIFF COMMISSION. [JAMES S. BURDSAL. JAMES S. BURDSAL. Cincinnati, Ohio, September 5, 1882. Mr. James S. Burdsal, of Cincinnati, president of the Western Wholesale Drug Association, made the following statement: Gentlemen of the Tariff Commission: I desire to state that the Western Wholesale Drug Association at its annual meeting held in Cin- cinnati, Ohio, November 9 and 10, 1881, unanimously passed the follow- ing resolution : “ That it is the sense of this association that Congress should levy a duty of 10 per cent, on all salts of quinine.” The views of the association were briefly these: That the trade would be better protected in the uniform prices of these goods if our home manufacturers should have a small protective duty as against duties on crude materials, and cheap labor in Europe; that as France and Italy lay a tax on these articles and protect their manufacturers, it would be manifestly unjust to admit their quinine into this country free; that if the removal of the duty on quinine was intended to cheapen the price, it has not had that effect; and if the government by the removal of duties seeks to cheapen the prices, the same rule should be applied to, and all duties should be removed from cotton, silks, woolens, potteries, pig iron, and other home productions. If the policy of our government is to afford a small protection and foster home manufactures, it should not discriminate against any particular interest and favor others. JAMES M. GLENN.] SUGAR, MOLASSES, AND RICE. 891 JAMES M. GLENN. Cincinnati, Ohio, September 5, 1882. Mr. James M. Glenn, representing the Grocers’ Association of Cin- cinnati, made the following statement: Gentlemen: A committee, consisting of Mr. L. C. Keever, I). A. White, and myself, was appointed by the Grocers’ Association of this city to present to the Commission the views of the trade on the ques- tion of duties on sugar, molasses, and rice. We beg leave to submit a few statements of fact which we believe will be indorsed by a majority of dealers in the entire West. The interests of the great West are identi- cal with those of Louisiana, Texas, Florida, South Carolina, and Georgia, where these staples are produced, on these important questions, because of the large and steadily increasing commercial interchange in all branches between these two sections. With an increase in the produc- tion of these important staples, under the fostering stimulation of a protective tariff, there comes in return a largely increased demand for, and consumption of, Western produce of every kind, provisions, manu- factures, and coal. Our great lines of water and railroad transporta- tion are also largely benefited by the resulting increased carrying trade •in this inter State commerce. The sections named have the capacity to produce sufficient of these great necessary staples to supply the en- tire West, if not the whole country, and a continuation of a wise and liberal policy of protection must so rapidly develop and increase the pro- duction, as in a few years to establish, permanently, sources of vast wealth in sections unfitted for other agricultural purposes, and from which the entire country must reap large benefits, besides rendering us independent of a foreign supply, thereby relieving us of the present large annual drain incurred for their importation. By this means we not only keep the money now paid for a foreign supply at home, but also vastly promote the prosperity of the sections by the enlargement of their mutual commercial exchange of commodities. We believe it to be the duty of the government to continue to fully protect these great industries, now struggling to recover from the dis- asters of war; and we further believe that it will be immensely to the benefit of the entire country that they be re established on a more en- larged and prosperous basis than heretofore. Our own city owes her early welfare and rapid growth largely to her profitable commercial in- tercourse with the once wealthy South, and especially with Louisiana, and her merchants look forward to an early return of this former valu- able traffic with Louisiana under the rapid development of her sugar and rice interests, whicli must soon occur with a continuation of the protection to which she is justly entitled. We therefore strongly urge that no change be made in the duties on these articles which will afford less protection than is now extended to them, the present tariff* giving no more protection than is actually neces- sary to encourage their production and stimulate their increase. We unhesitatingly venture the opinion that the agricultural people of the Mississippi Valley are in warm sympathy with the development of these great Southern industries, fully appreciating as they do, the 892 TARIFF COMMISSION. (JAMBS M. GLENN. advantages to be derived from the establishment of large permanent home markets for their products, and that they will earnestly unite with other Western interests in a cordial approval of a continuation of the present policy of protection. We also call your attention to the fact that the production of sugars and sirups from corn and sorghum cane is now becoming an important and widely spread interest in the West and Northwest, and one that will readily commend itself to you as an additional argument in favor of the continuance of a liberal and wise policy of protection to these staples. In the event of any modification of the present tariff on sugar, we would suggest that the rate on Nos. 14, 15, and 16 should not, as now, be scaled so high above refining grades as to exclude them, but that the scale of the duty should be so graded as to allow their importation at a fair advance over the rates fixed on refining grades. We would further earnestly recommend the addition of the polari scope in deter- mining the intrinsic saccharine value of all refining grades, that high test sugars under low colors may no longer be admitted at the same rates as low test sugars of corresponding colors. By Commissioner Kenner : Question. As I understand, you represent exclusively the dealers in groceries; you do not represent manufacturers of any kind, do you? — Answer. No, sir; we represent a mercantile association known as the Grocers’ Association of Cincinnati. It comprises the leading grocery dealers of our city. Q. In no sense are you connected with manufactures of any kind ? — A. No, sir. Q. You do not represent the sugar refiners of the country, or any in- terest of that kind ? — A. No, sir ; only the Grocers’ Association of this city. Q. What is the largest quantity of sugar that has ever been imported from New Orleans to Cincinnati, so far as you know? — A. Before the war that was a very important trade to Cincinnati. The entire sugar trade of Cincinnati, and of this section of country, was with the State of Louisiana. We had no Eastern sugar trade before the war, and that is the reason why this section feels such a deep interest in the restora- tion of this Louisiana trade. I have some statistics with me on this sub- ject, showing the receipts of sugar and molasses at this port from the State of Louisiana for the years named, as follows: Years. Hogsheads of sugar. Barrels of sugar. Barrels of molasses. 1845-’46 13, 710 49, 229 64, 461 58, 885 4, 956 24, 001 25, 441 28, 359 36, 510 115, 112 1852 ’53 1853-54 1858-’59 116, 193 We did not know any other sugar in those days than Louisiana sugar. Q. How did you pay for all this sugar and molasses ; in money, or in goods? — A. We paid for it directly in money; but indirectly we paid for it in Western supplies. Before the war the money that we paid to Louisiana for this sugar and molasses gra vitated back here. Louisiana was a very good customer of the West, and the merchant who paid the Louisiana planter money for his sugar, molasses, and rice, received it back again here for supplies which he furnished him. We sold them JAMES M. GLENN. ] SUGAR, MOLASSES, AND RICE. 893 pork, corn, and other articles of consumption, and all our grocery houses were busy loading boats with produce of every kind to ship to the planters ; so that in the course of a year a large amount of this money came back to us. We also sold a large amount of machinery to the planters to be used in Louisiana. Q. Have you any idea of the number of steamboats employed in this business? — A. No, sir; I have not. Q. How long does it take a boat to make a round trip from Cincinnati to New Orleans? — A. From 25 to 28 days, allowing time in loading and unloading in each port. Q. One boat will make four, five, or six trips a year, then? — A. Yes, sir. During an active business season, sometimes we would load a boat a day, carrying from 800 to 1,000 tons freight to New Orleans, and three or four boats a week was not an uncommon thing during the business sea- son, which lasted usually from September until May or June. We now are able to load three boats a week here, and to bring back three boats a week, while not long ago it was hard to get one cargo a week; which shows that, the freight is increasing. I understand that the steamboat interest will appear before the Commission, and they can probably give you some information on this point. I think that every member of our association feels the importance of impressing upon the Commission the fact that this Louisiana shipping trade is a great interest to be developed. We get Carolina rice here, and have done a large business in it; but since the rice interest has grown up in Louisiana, this particular section, on the Ohio and Mississippi River, gets its supply mostly from Louisiana, and it was a source of great prosperity to us before and up to the time of the war. We feel deeply interested in encouraging and developing this interest, hoping that it may bring back that prosperity to us in a larger fold. I think I speak the sentiment of every grocery merchant connected with our Grocers’ Association when I make this statement. Commissioner Underwood. I know it to be a fact, but I want it to appear on the record, that the rice that is made on both sides of the Savannah River, Georgia, is classed and called Carolina rice. The Witness. Yes; it is. There is no grade of rice here known as Georgia rice. We only know two kinds of rice — Carolina and Louis- iana. We have been in the habit of buying rice in Savannah as well as in Charleston, but when it goes to other markets it all goes under the head of Carolina or Louisiana rice. 894 TARIFF COMMISSION. [e. w. COLE. C. W. COLE. Cincinnati, Ohio, September 5, 1882. The following statement, giving reasons why a specific duty should be levied upon lava gas tips and slate pencils, was submitted by Mr. C. W. Cole, president of the Anchor Soap-stone Company, of Cincinnati, and. ordered to be printed: Gentlemen of the Tariff Commission: Nearly all the lava gas tips and slate pencils used in the United Sta tes are manufactured in Ger- many. This is the case, not because these goods cannot be manufact- ured in this country, equal or better in quality, but because of the starvation prices paid for labor in Germany, and the absence of a suffi- ciently high tariff to enable American manufacturers to compete with them. A specific duty of say $2.50 per gross, and 40 per cent, ad valorem additional on lava gas tips, and say $1.50 per thousand specific, and 40 per cent, additional ad valorem on slate pencils, would make no appre- ciable difference in the cost of these goods to the consumer, but w 7 ould foster the American industries, and enable the manufacturers of these goods to pay remunerative wages to employes and, at the same time, successfully compete with German manufacturers. For many years it was thought that the only material out of which lava gas tips could be made was to be found in Bavaria, and conse- quently these tips were all imported into this country, costing from $4 to $5 per gross. A few years ago, however, the material from which they are made was discovered in large quantities in North Carolina and other Southern States, and their manufacture was begun in this country. In a very short time the price of the imported tips was reduced, until now they can be imported at a cost of 75 cents per gross or less, after paying an ad-valorem duty of 40 per cent. A specific duty of say $2.50 per gross, in addition to the 40 per cent, ad valorem now imposed, would not only build up manufactories of these goods in this country which would afford remunerative wages to many employes, but would make valuable the soap-stone mines in the South- ern States which are at present without value. It need hardly be mentioned that such a duty would not add two cents apiece to the price of lava gas tips, and would not add the weight of a feather to the burden of the consumer. What has been said above in reference to lava gas tips applies in equal force to the manufacture of slate pencils. A few years ago slate pencils, when imported from Germany, cost from $2 to $3 per thousand. Several factories were started in this country, when the price of slate pencils was reduced until they can now be imported at from 00 cents to $1 per thousand, after paying a duty of 40 per cent, ad valorem. The low price paid for labor in Germany — fsee “State of Labor in Europe, 1878,” published by Congress] — is the reason for this. A specific duty of say $1.50 per thousand, and in addition 40 per cent, ad valorerp, would stimulate the manufacture of slate pencils in this country, and as now the consumer would get his slate pencils at a cent apiece, or even as low as two for a cent. American manufacturers will not be able, for many years at least, if ever, to supply the demand for lava gas tips and slate pencils, so that the additional duties suggested on these goods would largely increase the revenues of the government. M. V. DALY.] SUGAR, MOLLASSES, AND RICE. 895 M. V. DALY. Cincinnati, Ohio, September 5, 1882. Mr. M. V. Daly, of Cincinnati, Ohio, representing the Southern Trans- portation Line of Steamboats, made the following statement : A committee has been appointed to represent the steamboat interest of this city, as regards the trade between New Orleans and Cincinnati ; and, as a member of that committee, I desire to present my views to the Commission in regard especially to the tariff upon sugar, molasses, rice, and minor articles which we carry largely. We are in favor of a moderate tariff. We carry freights from the month of November until March ; and almost two-thirds of our cargoes from New Orleans to Cin- cinnati are composed of molasses, sugar, and rice. We think if there is free trade in tli ese articles, if the sugar that is raised in Cuba and those other slave-growing countries is allowed to come in competition with the products of the Southern States, it will have a very injurious effect indeed upon the whole South and Southwest. At present in the East they have almost a monopoly. They have large sugar refineries and manufactories in Boston for making rum from molasses. They have vessels built especially for carrying the molasses in bulk. If the pro- duction of sugar and these other crops in the South is interfered with, it will entirely destroy our business and transportation. We represent the only line of steamers running from Cincinnati to New Orleans. Oc- casionally there may be a stray outside boat, but not in regular com- petition. We have ten or eleven fine palatial steamboats, which carry from 1,200 to 1,500 tons each, and we make eight or nine trips each sea- son, laden with these products. In return we take down the manufact- ures of the Northwest. This is a great manufacturing city. We trans- port the furniture that is made here ; we take down a great deal of the hardware which we get from Pittsburgh ; we reship it here on our boats. We also transport the meats of Cincinnati, and the products of the Ohio River from Evansville, Mount yernon, Paducah, and so on. We also take large quantities of nails and glass from Pittsburgh, reship them here under a system of pro-rating, they carrying them about 500 miles, and we carrying them the balance of about 1,500 miles, and di- viding the rate into three parts, they taking one- third, and we two- thirds, which allows them a little more than their share for the actual mileage. The successful prosecution of our business depends upon the freight which we get on our return trips. We can possibly get a trip down that will nearly pay expenses, for, as you must all know, running a steam- boat is a very expensive thing. Our boats average from $6,500 to $9,000 atrip expenses, and that is all cash paid out; we do not get anything on credit; it is all cash. We not only must get enough to pay our ex- penses, but we must also get a return for interest on capital invested, or steamboats must cease to be. We carry large quantities of glassware from Pittsburgh, also immense quantities of nails for the South ; and we get this freight because we can carry it cheaper than the railroads can. The whole question is one of cheapness. We carry many passengers 896 TARIFF COMMISSION. fM. V. DALY also. We take a passenger from here to New Orleans on an excursion trip, allow him to stay two or three days in New Orleans, keep him on the boat, give him as good fare as he can get in a hotel, and bring him back to Cincinnati, a trip occupying twenty -three to twenty-five days’ time, and all we charge him for it is $40, or about $1.60 a day. Why do we do it ? Because we have to feed a crew of fifty to sixty men on board, and when we cook for these men we can provide for an additional number without much extra expense. In that way we are enabled to pay the expense of feeding our crews. All the Western boats feedtheir own crews. We have not a single sugar refinery in this city. They tried to estab- lish two factories here at one time, but they soon abandoned the busi- ness, because they could not compete with the great factories in the East. I know of only one sugar refinery in the West, and that is at Saint Louis. You are all aware that these sugars have to be refined after they are brought here. Take the different varieties of low-class sugars, and they are all sent to New York to be refined; they could not be used before refining, for they are as black as ink. We have no refinery here, and there is no refinery in New Orleans, and they have to go to New York. It would be unjust to Western interests particularly, to allow free trade in these foreign goods, besides destroying our sugar planters down in Louisiana, who consume the products which are sent to them from this portion of the country. Those planters are all depending on being able to get a marketable price for their sugar to enable them to pay for the necessaries of life which they consume. If you allow im- ported sugar to come in competition, the result will be that the price of their sugar will fall to such a figure that it will not pay them to culti- vate it at the present rate of wages, and their plantations will again become waste, as many of them are to-day, and it will inflict a deadly blow upon that industry in the South. I think I have said all that is necessary to be said on this point. I have tried to condense my ideas so that you can understand the position we assume. The point which we make is that it would be a great injury to the transportation business, of the West and South especially, to have free trade in sugar. It would bring the planters of the South in direct competition with the slave labor of Cuba, and not alone that, but it would divert the trade to New York and Boston, where it would be monopolized by large capitalists, and, as a consequence, we would be entirely prostrated, and the cultivation of sugar in the South would be abandoned. I thank you for your attention. By Commissioner Porter : Question. As I understand you, the interest which you represent desires that no change shall be made in the existing rates of duty upon sugar and other productions of the South ? — Answer. Yes, sir ; we want no change. Mr. Vincent Shenkel, of Covington, Ky., also representing the Southern Transportation Line, said : 1 think the gentleman is mistaken ; we want a change. The Cuban sugar comes in now artificially colored, so that it will pass at a lower rate of duty. We want the duty placed at such a rate that it will pro- tect these sugar planters in Louisiana. At the present time one-third of the plantations there are lying idle ; they are not raising sugar, and we want to protect these people so that they can raise sugar there again. M. V. DALY.] SUGAR, MOLASSES, AND RICE. 897 By Commissioner Porter : Question. That is to say, you want the present tariff laws enforced ? — Answer. Yes, sir ; have the present rates of duty enforced, or put the rates a little higher. In regard to this matter of coloring the sugar, I understand it is done wholly for the purpose of evading the law and bringing in foreign sugar at a lower price. By Commissioner Underwood : Q. You want the present duty maintained, and a system devised that will tax the sugar, not by its color, but by its saccharine strength ? — A. That is what we want, exactly. H. Mis. 6 — -57 898 TARIFF COMMISSION. [JOHN L. PFAU. JOHN L. PFAU. Cincinnati, Ohio, September' 5, 1882. Mr. John L. Pfau, of the Globe Rolling Mill Company, of Cincinnati? Ohio, made the following statement: In regard to the subject of iron roofing, I will state that as long as tin stood at a high price in England, the manufacturers of iron roofing (those who took sheet iron and painted and crimped it) were not brought in competition with the article of tin very much, because the price in England for a number of years was quite high. But for the last few years the price has ruled so low that, as Mr. Hyndman says, tin with the lower tariff on it can be imported cheaper than iron can be painted and prepared in this country. With the 35 per centum ad valorem duty on the iron painted, they can also introduce it cheaper than it can be made in this country, as Mr. Scott, as I am told, is doing. He consumes about seven hundred tons of sheet iron a year. This industry has grown very rapidly from a consumption of three hundred tons in 1870 to nearly ten thousand tons per annum for the last few years. It has received a check, however, during the last two years, by reason of tin being made as cheaply as iron. By Commissioner McMahon : Question. You account for the present condition of affairs in this business by the changes in the relative prices of the two articles? — Answer. Yes, sir. Q. And therefore you think to maintain a fixed standard or ratio of proportion between the two it will be necessary to place a purely ad valorem duty on both classes of articles'? — A. No, sir; I do not say that. I am not wedded to either one or the other form of duty ; but 1 say a relative proportion of duty should be imposed on tin as compared with iron. Iron roofing manufacturers are discriminated against by the duties upon tin, unless the iron is allowed to come in this country under a much lower tariff; and even iron can be imported under the 35 per cent, ad valorem duty at less than it can be manufactured for, because the duty will be much less on the manufactured article than on the raw material. As long as there was a gold premium it added that much to the tariff; but now, under the ad valorem duty, they can import pre- l>ared sheet iron ready to put on roofs cheaper than it can be made by the manufacturer, by reason of the fact that the 35 per cent, ad valorem duty makes the duty (30 cents a hundred on the one article, where it is $1.75 on the other. This importing of sheet iron has only been com- menced recently, as I understand. JOHN L. PFAU.] IRON. 899 JOHN L. PFAU. Cincinnati, Ohio, September 5, 1882. Mr. John L. Pfau, secretary of the Covington and Newport Polling Mills, addressed the Commission as follows : Mr. John Mitchell and myself, who appear before you in a represent- ative capacity, represent eight rolling mills, located in the neighborhood of Cincinnati, employing from 4,000 to 4,500 men. The action we take in this matter is unanimously approved by the rolling-mill proprietors. We have prepared the following statement of our case : At a meeting of the rolling-mill proprietors of Newport and Covington, in the State of Kentucky, and Cincinnati, Ohio, representing eight mills now in operation, employing 3,500 workmen, it was the unanimous sense of the meeting that it would be unwise and injurious to the iron interest of the United States to have the tariff on any kind of iron re- duced at present, especially on rolled iron, such as bar, sheet, plate, hoop, angle, and other shape irons, as through the system of u protec- tion” to American industries the production of manufactured and pig iron has been increased fully a hundred per cent, since the year 1870, which leads us to hope that by the year 1890 ours will be the nation hav- ing the largest production of iron in the world, should not action in the way of a reduction of the tariff on iron take place, which would greatly reduce our present production. England for some years past has been paying her iron workmen on an average 40 per cent, of the amount paid iron workmen in the United States west of the Alleghany Mountains. This, coupled with accumulated capital and cheap money in commercial circles, and easy and cheap connections by rail and water with sources of supply of raw material, will enable England to undersell us in the markets of the world for some years to come. On the contrary, continuing our protective- policy will, we believe, enable by us holding out inducements to expend the profits of our works in new and costly machinery and appliances, to reduce the number of days 7 labor required to produce a ton of manufact- ured rolled iron to the minimum, and pay liberal wages to our workmen. Aided by the development of new and cheap railroad transportation it will give us access to the yet comparatively inaccessible iron-ore beds of Virginia, North Carolina, Georgia, Alabama, and Tennessee, especially to those of northwest North Carolina, with its inexhaustible beds of black magnetic iron ore, the best in the world, as well as northern Georgia, north- ern Alabama, and eastern Tennessee with its cheaper grades of iron ores and cheap fuel, and when adequate railroad facilities are secured, which, however, will take some years yet, it will assist largely in placing us in the line of competition with the iron markets of the world. For these reasons we are opposed to the reduction of the tariff on iron for some years to come, and believe a very decided expression in that direction by your honorable board to Congress, and the latter 7 s approval, would greatly hasten the further development of the iron industries of the United States. 900 TARIFF COMMISSION. [JOHN L. PFAU. But should any changes be deemed necessary, we submit the follow- ing proposed rates of duty on plate, sheet, and taggers’ iron : PROPOSED RATES OF DUTY ON PLATE, SHEET, AND TAGGERS’ IRON. Boiler or other plate iron and sheet iron, common or black, not thinner than No. 25, wire gauge, one cent and one-half per ponnd. Thinner than No. 25, wire gauge, and not thinner than No. 29, wire guage, one cent and three-fourths per pound. Thinner than No. 29, wire guage, and all iron known commercially as taggers’ iron, whether put up in boxes or bundles, two cents and one-half per pound. Kussia, polished, or glanced sheet iron, or sheet iron by whatever name designated, polished by a hammering process, three cents per pound. Sheet iron by whatever name designated, which has been pickled or cleaned by acid, or by any other material or process, or which is cold or single rolled, or polished or smoothed by rolling, or by any other proc- ess not herein described, without reference to the degree of polish, shall pay one-half cent per pound more than the corresponding gauges of common or black sheet iron. PROPOSED PROVISION FOR MANUFACTURES OF PLATE AND SHEET IRON. All shapes and blanks made of sheet and plate or other rolled iron, and all manufactures of sheet or plate or other rolled iron, and all articles made of sheet or plate iron, or of which sheet and plate or other rolled iron shall be the component material of chief value, whether wholly or partially manufactured, shall pay no less rate of duty than is imposed on the sheet or plate or other rolled iron from which they are made. PROPOSED PROVISION FOR TIN PLATES. Sheets or plates of iron, or sheets or plates of steel or taggers’ iron, galvanized or coated with tin or lead, or a mixture of tin or lead or other metal by the dipping or any other process, shall pay a duty of one cent more per pound than the duty on the respective gauges of the sheets or plates of iron, or the sheets or plates of steel, or the tag- gers’ iron, which have been thus galvanized or coated. PROPOSED RUST OR DAMAGE CLAUSE. No allowance or reduction of duties for partial loss or damage shall be made upon any description of iron, or upon any manufactures of iron, or upon any article of iron partially manufactured, in consequence of rust. In conclusion, we desire to say that a reduction in the tariff on iron, means reducing the wages of our skilled and other workmen, and de- priving them of the comforts necessary for a pleasant home, and the means to suitably educate their children; all of which we believe every American workman should be possessed of. We do not wish to see the wages of our workmen placed on a par with the underpaid semi-pauper labor of England and Belgium. JOHN L. PFAU.] IRON. 901 By Commissioner Kenner: Question. It has been stated that iron manufacturers in the interior, say at Cincinnati and Chicago, being so far removed from the seaboard, are protected by the freights, and could stand a reduction in the duty, because of the fact that the freight on iron from the seaboard to the in- terior is a protection to them. What have you to say about that? — Answer. It might within a very short radius of Cincinnati be a pro- tection to the extent of the difference of freight from England to that point, and from Cincinnati to that point. On the other hand, when you take our entire coast country from Baltimore to Florida, and around to Corpus Christi, at every point from Baltimore to Corpus Christi the English importers would have an advantage of from tep to fifteen cents against us 5 that is to say, they would be better off on account of freights, to the extent of 10 cents a hundred on an average, than we would be, shipping to the same point. Of course in Texas the discrimination against us in the matter of freights would be 20 or 30 cents a hundred, while in Baltimore it would be perhaps only from 5 to 10 cents in their favor, and in Bichmond about the same, perhaps, or a little more, while down in Charleston it would be, say, 15 cents in their favor. The fur- ther south you go the more it would be in their favor, with the exception of New Orleans, where I suppose it would be only about 10 cents a hun- dred in their favor, because that is a leading point of communication with Cincinnati by the direct river line. At Chicago, in the summer months, it would be about on a par with direct importations. Parties are now importing iron to interior ports. I saw an invoice of No. 27 iron at Hibbard & Spencer’s office. They showed me the freight cost and figured it up at $1.17 ; and that was purchased three or four months ago. They probably made it a little less than we would make it to-day, because that iron was imported perhaps in May, before any of the labor troubles occurring here could have induced them to take such steps. They certainly must have ordered it by the middle of June. I 11 Buffalo, Chi- cago, and Milwaukee, I think the freights overland by rail would be practically the same as on iron imported from England, unless there was a great cutting in rates, which, of course, is not a normal condition of trade. But on the entire coast-line, the English would have the ad- vantage over the American rolling mills in the matter of freight, ex- cept, of course, as regards a few rolling mills located at Philadelphia. At present our sources of supply are very widely separated. At Pitts- burgh they pay $11 a ton for ore brought from the uppermost part of Michigan. They take the ore from the mine, ship it by rail and boat to Cleveland, and then put it on the cars and ship it to Pitts- burgh. That is over a thousand miles in distance, and it is very costly transportation. 902 TARIFF COMMISSION. [GEORGE STRIBLEY. GEORGE STRIBLEY. Cincinnati, Ohio, September 5, 1882. Mr. George Stribley, of the firm of Stribley & Co., of Cincinnati, Ohio, manufacturers of ladies’ shoes, addressed the Commission as follows : • Gentlemen: As the morocco manufacturers of this country are ac- tively laboring to advance the duties on tanned and finished goat and sheep skins, the boot and shoe manufacturers of the United States who handle these articles find their interests imperiled on account of the inadequate supply of finished material, and a consequent necessary advance in the price of boots and shoes to the consumer. The larger portion of ladies’, misses’, and children’s shoes made in the United States are manufactured from what is known as morocco and kid, which are made from goat skins, the greater portion of which are imported in a dry state and are here manufactured into kid and morocco stock at factories located at Philadelphia, Wilmington, New- ark, Brooklyn, Baltimore, Boston and its vicinity. These skins, which come to us in a dry state, are free from duty, and as there is no com- mercial value attached to the goats except for their milk or meat when fresh, and their skins, they do not receive the usual care with herds- men to cause them to breed and multiply; hence their skins do not and will not increase in quantity in proportion to the increasing demand for them. Within the last ten years the prices of these skins in New York mar- ket in first hands have advanced, for Mexicans, from 40 cents to 57J cents per pound; South American, from 35 cents to 56 cents a pound; Ouracoa and Rio Hacha, from 38 cents to 60 cents per pound; Patna (East India), from 25 cents to 45 cents a skin; Mochas, from 20 cents to 45 cents per pound, and others correspondingly. During the past three years, prices of finished skins from first-class manufacturers have advanced as follows : At this time, in 1879, best Cura- coa and Rio Hacha kid were worth 34 cents a square foot, and the same stock brings now 42 cents ; Macha kids, 26 cents, now 32 cents ; fair selec- tion of Patnas, 17 cents, now 24 cents ; best Tampico pebble, 22 cents, now 27 cents ; Cape pebbles, 20 cents, and are now worth 24 cents. This comparison of prices is made on standard kinds of skins from manufac- turers who are noted for uniformity of selection, and who have continued to use standard goods. It is a well-known fact that as prices advance the selections become poorer, and consequently the intrinsic advance is very much more than it appears in figures. Large quantities of fine kids are imported from France, upon which there is a duty of 20 per cent., and as there is no possible substitute for this kind of stock in the United States it should come free of duty. Duriugthe last few years a trade in East India tanned sheep and goat skins has sprung up, upon which a duty of 10 per cent, is paid, and which amounts at this time annually to three million goat skins and only a little less in sheep skins. These skins have also advanced in value in GOAT AND SHEEP SKINS. GEORGE 6STRIBLEY.] 903 a ratio with the raw material both in the hands of importers, and with manufacturers who finish them into kid and morocco. The chief supplies are as follows per annum : From Mexico, one million skins 5 South America, one-half million; Curacoa and Rio Hacha, one and a half million; Patnas (East India), four million; Mocha, two mil- lion ; Cape Good Hope, Russia, and other places, four million. The market is constantly bare of both raw and finished skins, and the importer and manufacturer find no difficulty in disposing of all their goods at full value. The product or source of supply being continually kept drained by an excessive demand, as shown, there cannot possibly be any important increase in the importation of raw skins. For these various reasons assigned, I deem it unjust to the shoe trade and detrimental to the people at large to impose a duty on either tanned or finished kid or goat stock. Better by far take the present tariff off from both, and thus afford an opportunity to boot and shoe manufac- turers to work up our surplus sole leather, which we now sell to Europe to the extent of ten million dollars per annum, and thus home manu- facturers will have the privilege of making shoes for our neighbors in Mexico, Central America, South America, and the adjoining islands, instead of furnishing the material to Great Britain, France, and Ger- many, and in this manner assisting foreign manufacturers to supply these countries with nearly all their boots and shoes. My reason for coming before you is this: that the manufacturers of raw skins — that is, skins brought into this country with the hair on — have been urging on Congress an increased duty on tanned skins, which are brought mainly from the East Indies, and as the supply of these raw skins is not in proportion to the demand, I think it would be impru- dent to increase the cost on tanned skins. Some few years ago, when there was a duty on the importing of hides and skins, the duty was taken off hides and skins in the raw state, as a compromise, and a duty amounting to one-half was left on tanned skins. Now the manufacturers of the Eastern States ask that the duty on these tanned skins shall be made equal to the duty on finished stock. I think that is unnecessary. A short time since, in asocial conversation with a large manufacturer of goat skins, when the question of tanned and raw skins and the duties upon them was under discussion, he said : If they will gh r e us tanned skins duty free, we can very well afford to compete with European manufacturers of morocco, and will be willing that the duty shall be taken off all finished skius. By Commissioner Porter : Question. Do you know of any interest which would be particularly injured by putting skins on the free list? — Answer. No, sir; I do not. Q. You do not see any reason why that should not be done? — A. I do not; because all the supplies of raw skins which can be procured are in active demand, and the price, as I have said, is constantly increasing. Q. Is it not a fact that we have the largest single manufactories of boots and shoes in the world; is not one in New England the largest manufactory in the world ? — A. I think the Batchelor factory, at North Brookfield, Mass., is the largest factory in the world. They would not be affected at all. They manufacture boots and shoes and use domestic material entirely ; and since the duty has been taken off raw hides the tanning of leather has increased so much that they export a large quantity, and I see no good reason why, if we had cheaper upper mate- rial, we could not make up the goods needed for export. In fact, the export of shoes made of domestic leather now is in excess of the import 904 TARIFF COMMISSION. [GEOKGE stbibley. of shoes made of fine leather. If we had fine leathers cheaper, we conld create an export trade in those goods. We have the sole leather, which is an important item, and which mnst go into every kind of shoe, in better supply and in better quality than any other country. Q. Is it not a fact that the United Sta tes to-day makes in several grades of shoes the very best article for the money paid, taking into considera- tion the quality of the stock put into it? — A. Yes, sir,* I think that is so. Some four or five years ago I made a trip through Europe and examined the manufactories of boots and shoes there. The machinery which they use is American machinery, with scarcely an exception. Their method of using those machines in all kinds of shoe factories was not equal to ours. And while our wages are much higher, we can produce nicer goods than they can, at the same cost for labor. By Commissioner McMahon: Q. Are these East Indian tanned skins used as imported, or are they dressed and finished before using? — A. They are taken off the animals in the interior of India, where they have tanning material in abundance, and are tanned there and are shipped here in a tanned state. They are here taken by the morocco manufacturers and dressed and finished before they are used. Q. Then, so far as that is concerned, they are a raw material when they come here; they are not used at all as they are imported ? — A. Oh, no, sir; not at all. J. B. MITCHELL.] DRY GOODS. 905 J. B. MITCHEL. Cincinnati, Ohio, September 5, 1882. Mr. J. B. Mitchel, of the firm of J. W. Luhn & Co., Cincinnati, Ohio, importers of merchandise, addressed the Commission as follows: I am not in any way connected with the manufacture of productions of any kind. Our firm has been in the importing business ever since this city was made a port of entry. Importations here are increasing because of the facilities we have enjoyed since that time. Many in- stances have come under our observation showing the present complica- tion of the tariff laws. Our importations are, of course, limited in num- ber; but within that limited number so many changes have been caused in the tariff laws in regard to the duties on our special class of goods, by the decisions of appraisers and rulings of the department, that I judge, if the same proportion holds good throughout all classes of importations, a large portion of the force of government employes connected with the customs service must have their time almost wholly taken up in acting simply as experts. I have made a note of some of the points which I wish to present to the Commission, and I will give them to you as I have noted them down. . The duties on certain articles which we import are so complicated as to have caused many and contrary rulings and decisions, as well as much annoyance and loss to importers. Numbers of decisions on these and similar articles have appeared to the importers to be against the evident intent of the law; and after vexatious and protracted litigation many such decisions have been reversed. On many of these questions the importers have been unanimous in their interpretation of the in- tent and meaning of the law as against the decision of the appraisers. I will briefly call attention to some of these articles, all of which we are engaged in importing and selling; and I presume any importer of any other class of goods can enumerate a similar, if not larger, proportion of disputed articles. In Italian cloths and mohair serges, used for lining in clothing, three classifications exist. Those under 4 ounces per square yard and under 20 cents per square yard pay 6 cents per square yard and 35 per cent, ad valorem. Those under 4 ounces and over 20 cents per square yard pay 8 cents per square yard and 40 per cent, ad valorem. Those over 4 ounces pay 50 cents per pound and 35 per cent, ad va- lorem. On account of these different classes of the same goods, it was decided some years ago that all figured Italian cloths, &c., should pay the high- est rate, as dress goods. Thousands and even hundreds of thousands of dollars were recovered from the government by importers who pro- tested against paying these rates, after months and even years of costly and vexatious litigation. I would suggest that all this class of goods pay one rate of duty. In one lot of goods imported by ourselves, all costing under 20 cents per square yard, part were colored and part were black. The portions which were finished in colors were slightly heavier than the blacks, from the 906 TARIFF COMMISSION. |J. B. MITCHELL. nature of the dye and finish. The blacks weighed just under 4 ounces, and the colors a shade over 4 ounces per square yard. Consequently our black goods cost us 31 cents per yard and our colored ones over 38 cents, because of this slight accidental difference in finishing two por- tions of the same goods. In cottons, for many years, and until something over a year ago, silesias were passed at 5£ cents per square yard and 20 per cent, ad valorem, if dyed, printed, or colored. Now they are classified along with tickings, &c., and pay 6J cents per square yard and 15 per cent, ad valorem. All importers of these goods are paying the new rate under protest, well convinced that on a hearing of the question the United States courts will reverse the decision of the department. Many of these goods are printed and are used for linings in clothings, and often the same pat- tern is printed both on the twilled silesias and on plain woven cottons, the latter paying the lower rate and the former the higher rate of duty, both being used for the same purposes and not differing in any manner from each other, except as to a slight difference in the set of the loom. In manufactures composed of silk and cotton several rates of duty are collected, from 35 per cent, to 00 per cent, ad valorem, the different rates depending solely on the proportions of the two materials. In these goods when the silk is under 25 per cent, in value the rate is as cottons. When the silk is over 25 per cent, and under 50 per cent, the rate is 35 per cent, ad valorem. When the silk is over 50 per cent, and under 75 per cent, the rate is 50 per cent. When the silk in over 75 per cent, the rate is 60 per cent. On account of the difficulty of deter- mining the actual proportions many disagreements arise between the importers and the appraisers- It is impossible for the most expert ex- aminer to be conversant with the various grades of the silk and cotton yarns in all the manufactories of the world, much less to keep informed of the various and unequal fluctuations in the market values of these materials. So two honest appraisers of the same port may differ on these goods, and it is still more possible for appraisers at different ports to differ. Many such cases of difference have arisen, giving the mer- chant in one city a great advantage over his competitor in another city. An examination by you of thousands of decisions and rulings of the department, on file in the appraisers’ offices, will forcibly illustrate the complications and difficulties arising constantly on account both of the ambiguities of the law, as well as the impossibility of the appraiser de- termining the exact proportions of the value in many mixed goods. I would, therefore, respectfully suggest that if your Commission make no recommendation for any other changes in the tariff, that you will meet the wishes of all classes of citizens, in any way connected directly or indirectly with the collection or payment of duties, by recommend- ing such changes as will simplify the classification of goods for duties. Such changes could be made as would materially reduce the cost to the government of collecting those duties without much reduction in the aggregate amount ; and at the same time relieve the importers and man- ufacturers of much annoy auce, uncertainty, and loss. It will no doubt have become quite plain to you by your present ex- amination of the subject that no radical change in the tariff, such as a large reduction or increase, or total abolition of duties, either on raw ma- terials or manufactured articles, will meet the wishes of all interests or fail to arouse the most decided and vehement opposition of some classes. The very fact that all material must pass through many stages of prep- aration and manipulation before arriving at the condition of a complete manufacture, makes it difficult to define or distinguish raw material and J. B. MITCHELL.] DRY GOODS. 907 manufactures. What is one man’s completed manufacture is another’s raw material, such as iron in all shapes, yarns, leather, and hunhreds of other articles. If such a simplification of the tariff laws can be effected by your Com- mission, while many interested classes will not have obtained all and just what they wanted, all classes will be gratified that some real good has been done by making plain, simple, and certain the laws affecting so largely their mercantile and manufacturing interests. By Commissioner Kenner : Question. Do you reside in Cincinnati ? — Answer. Yes, sir. Q. Are imports made directly to your custom-house here ? — A. Yes, sir. They come in bond to Cincinnati, and the duties are collected here. Q. And all these rulings, to which you have referred, have occurred in the Cincinnati custom-house ? — A. No, sir, not all ; they are rulings made in New York by the board of general appraisers, and by the de- partment at Washington. Any decision made in New York or Wash- ington with reference to an article affects all custom-houses through- out the country. Q,. As a rule, do you find that the appraisements made by the ap- praisers here, agree with the appraisements made at the custom- house in New York? — A. Their rulings are identical, because they are guided by orders from the department. Their opinions in regard to the classification of goods, however, 1 find are different. Q. Then I will inquire of you as to the classification. We have been told by importers elsewhere, that they have known goods to be im- ported into Chicago, classified and appraised there, the duties paid, and then returned to New York and sold at a larger profit than if they had originally been appraised at New York. Do you know anything about that? — A. I believe such cases occurred some years ago. Q. Did you ever know of such a thing occurring with regard to the custom-house here ? — A. No, sir. I have heard of cases of that kind occurring at the Chicago custom-house, and they easily could occur, as I explained, in regard to silk and cotton goods. The classification rests solely on the judgment of the appraiser as to the proportion of the two parts of silk and cotton. An appraiser here at the Cincinnati custom-house might think certain goods should pay a duty of 35 per cent., while in New York they might classify the same goods as subject to a duty of 50 per cent. We have imported goods, and they have been passed here at 35 per cent, (that was some years ago, before the matter got into its present shape), when I found out afterwards that the goods in New York were raised from 35 per cent, on the entry of the merchant to 50 per cent, on the decision of the appraiser. That of course depends on the judgment of the appraiser himself as to the value of the com- ponent parts. No statement is made in an invoice as to the value of the two different materials. Q. In importing, do you purchase your goods abroad $ or are you agents for foreign manufacturers? — A. We purchase our goods abroad entirely; but we find a great many articles are sold here by agents of the manufacturer at such a low price that we cannot afford to import them. That is a matter which 1 brought to the attention of a former commission, sitting in New York City at one time. I laid the matter before them, but nothing ever came from it as a result of the recommendation of the commission. That is a matter with which a great many merchants have found fault. I find that in some classes of goods we are unable to go to the foreign market and buy the goods and 908 TARIFF COMMISSION. [J. B. MITCHELL. bring them here as cheaply as we can buy them of the manufacturer’s agent, because the goods are consigned to the agent at prices we can- not buy them for abroad. By Commissioner Oliver: Q. That would only atfect you where goods come in under an ad va- lorem duty? — A. Of course. Take this matter of linings. We can- not buy them in Germany and import them as cheaply as we can buy them in New York from the manufacturer’s agent. Whether that is caused by actual undervaluation of the goods or not, I would dislike to say. There is certainly some good reason for it; but a reason I never have been able to discover. Q. In the custom-house here, are invoices, as they appear, generally ac- cepted ? — A. Undoubtedly. I do not know of any case in our experience where an invoice has been questioned in any degree at all. Q. You think that is the custom in regard to all goods imported at Cincinnati ? — A. I think with most of them it is; in our line, I am sure it is. There are very few houses here importing; our imports are lim- ited, in comparison with those of the Eastern cities. What the fact is in regard to the importation of spirits I cannot say; but I have heard of an instance in which the difference of duty was so great as to be some- thing over $7,000 on an estimated duty of $500. The instance occurred in the custom-house here where a lot of cherry juice was imported and entered, and the duty amounted, on the merchant’s estimate, to some- thing over $500, while the appraiser estimated tke duties at over $ 8 , 000 . By Commissioner Kenner : Q. That is a very wide margin ; how do you account for it? — A. Fruit juices pay a duty of 25 per cent, ad valorem. I do not know the exact duty paid on spirits; but I know they pay a very much higher duty. This cherry juice contained over 50 per cent, of alcohol — not by the hydrometer at all, as the appraiser tells me the hydrometer shows none in these fruit juices; but, by distillation, they got over half the quantity of pure alcohol. By Commissioner Oliver : Q. Beturning now to the point upon which I was questioning you : You say it is the custom generally at the Cincinnati custom-house to accept the consular invoice as entered by the merchant ? — A. Yes, sir. Q. And that they rarely go back of the invoice and make an appraise- ment of the goods ? — A. They always examine the goods. Q. Yes, of course ; but I mean that they rarely change or increase the value of the invoice? — A. I don’t know of a case of changing the value represented in the invoice ; it may have occurred, but I never heard of it. In fact, unless the examiner was a universal expert, he could not question the invoice. Unless he found two invoices from the same party on the other side of the water, of the same identical goods, at different prices, he would know nothing about it. There can be no such thing, of course, as a universal expert. Q. Do you know that it is the practice in the New York custom-house to frequently change the values appearing on the invoice? — A. Yes, sir; I know that. In New York there is so much business that an examiner has one class of goods only to examine. He has silk goods to examine, or sugars to examine ; in fact there are dozens of men engaged in the examination of sugars alone. Each man has a specific class of goods under his supervision ; while here, one examiner examines and J. B. MITCHELL.] DRY GOODS. 909 appraises all varieties of goods. Of course, a man who devotes his whole time to the examination of one class of goods will become more conver- sant with the value of those goods than he will if he examines many different kinds ; and in New York, besides, they have many more invoices to compare with each other, on account of the larger number of impor- tations. I understand that the appraisers in New York have a great many undervaluations and disputed valuations to contend with ; but that their difficulty chiefly is in regard to the classification of the goods. Q. But here, you say, it is the custom of the examiner to accept the consular invoice, and to charge the duties on that without question? — A. Yes, sir; I think so. And perhaps this is the reason: All impor- tations to Cincinnati, I expect, without exception, are purchased goods actually bought on the other side. In New York, a large proportion of the goods are received on consignment to agencies, upon which they pay the duties, and then sell the goods, and the price is not based upon the invoice at all, but is fixed by the manufacturer. He says to the agent in New York , 11 Sell the goods at such a price, United States cur- rency, pay the duties out of it, take your commission, interest, storage, and freight out, and return me the difference.” That is the way it is done. The invoice does not represent the payment for the goods at all. 910 TARIFF COMMISSION. [TORBITT & CASTLEMAN. TOEBITT & CASTLEMAN ET AL. Louisville, Ky., September 6 , 1882. The following communication from the wholesale grocers of Louis- ville, Ky., in regard to the duties on sugar, molasses, and rice, was read and ordered to be printed : To the United States Tariff Commission : Gentlemen: The undersigned, wholesale grocers of the city, beg to express their concurrence in the views of the Grocers Association of Cincinnati, as set forth in the paper presented to your honorable body on the 5th instant by their committee, on the question of the duties ou sugar, molasses, and rice. We think it highly important to the general welfare of the people of the Ohio and Mississippi Valley to foster these interests in our Southern States, and respectfully urge that no change be made in the duties on these articles. Very respectfully, Munell, Cabell & Co. Stege & Belling. Overbacker, Gilmore & Co. A. Enngelhard. Goddard & Co. TORBITT & CASTLEMAN. Morn, Brunaker & Co. W. E. Grimtead & Co. Otter & Co. Allen, Atherton & Co. MATTHEW O’DOHEKTY.] PROTECTION. 911 MATTHEW O’DOHERTY. Louisville, Ky., Wednesday , September G, 1882. Mr. Matthew O’Doherty, of Louisville, representing the Irish- Amercan Republican Club, appeared before the Commission and made the following statement: Mr. President and Members of the Tariff Commission : I will state that the club or organization that I represent is not a manufact- uring company, as you can see from its name. It is composed almost exclusively of workingmen, and the only reason we have for offering these suggestions is this: That we have had experience both here and in countries where free trade prevails. We, the committee appointed from the Irish Republican Club of this city, in pursuance of the instructions given us, and with a view of ren- dering you, and through you our common country, all the aid we can afford in the investigation of the all-important question of tariff*, re- spectfully beg leave to submit that many, if not all of us, know by act- ual experience the effect which iree trade and what is called protective tariff have upon the social condition of the masses of the people in countries where one or other of these systems prevails. With this ex- perience to guide us, we would be false to our duty as citizens of this republic did we fail to declare ourselves unalterably in favor of high protective tariff. We submit the following as the result of our experi- ence and observation : 1st. That the essential fact to be remembered in considering the pres- ent tariff laws, and lying at their very base, is, that the social condition of the masses of European workingmen is far inferior to that of Amer- ican workingmen. 2d. That free trade, or any material reduction of the present tariff, would necessarily force American workingmen into competition with European workingmen, and that such competition could only be suc- cessfully maintained by forcing American workingmen into the social degradation of their European competitors. This, in our opinion, would mean the enslavement of American labor, the pauperizing of American workingmen, the transfer of the children of American work- ingmen from the school to the factory, and of their wives and daughters from their homes to the workshop ; all of which would result in divid- ing the people of this country into two classes — paupers and aristocrats — and make a mockery of the maxim which declares ours to be a u gov- ernment of the people and for the people.” By Commissioner Kenner : Question. From what country have the members of your club come ? — Answer. They are nearly all Irishmen. Q. And therefore you speak in the name of the English operatives as well as the Irish? — A. Yes, sir. Q. When you make the comparison you make it between the English and the Irish on the one hand, and the Americans on the other? — A. Yes, sir. Q. There are no French or German members of your club? — A. Ko, sir. 912 TARIFF COMMISSION. [MATTEW O’DOHERTY. By Commissioner McMahon: Q. How many members have you in your organization?— A. One hundred and fifty. By the President : Q. All residents of Louisville? — A. Yes, sir. By Commissioner Boteler: Q. How long has your club been in existence? — A. I think about two ears. GOLDSBOROUGH ROBINSON.] ALCOHOL. 913 GOLDSBOROUGH ROBINSON. Louisville, Ky., September 6, 1882. Mr. Goldsborough Robinson, of Louisville, secretary and treas- urer of the Louisville Leaf Tobacco Company, appeared before the Com- mission and made the following statement: Mr. President and Members of the Tariff Commission: As the industrial interests of over fifty millions of people, through their representatives, pass in review before you, the thought must strike you painfully at times that it is impossible to so adjust the revenue laws of the country that all interests will be served and none injured. I have the pleasure of presenting for your consideration a proposition in which every citizen of the United States, no matter how humble, is interested, and yet by the favorable consideration of which every citizen may be benefited. 1 refer to the use of alcohol, without tax , in arts and manufactures. It may be urged at the outset that this is a question not of tariff, but of internal revenue. I reply that this question will affect your consideration of the adjustment of the tariff in many directions, and that it has already been brought before your honorable body by Mr. Bower, of Philadelphia, by Mr. Meyer, of Cleveland, and that Mr. Hewitt, of New York, introduced a resolution, during the session of Congress just adjourned, “that alcohol for use in manufactures should be placed upon the free list.” It is true that, in a discussion afterwards with Mr. Kelley, he ad- mitted that “this was crudely expressed,” but that he did desire to see some system provided which would grant manufacturers of this country alcohol free of duty. It will be impossible for you to consider fairly the tariff question without gathering some fiicts and making some recommendations in regard to its relation to internal revenue. As to the importance of this matter, the use of alcohol is necessary in almost every art and manufacture] and our present system of laws cramps our industries in hundreds of ways, unappreciated until the matter is investigated. We are the more injured in this matter from the fact that both Eng- land and Germany allow their manufacturers alcohol free of duty] and this forces the consideration of the tax on alcohol whenever you con- sider how our revenue laws may be so adjusted as to protect our in- dustries. If you will remember that in every foundry in this country alcohol is consumed in the varnish of the patterns, that it forms a necessary and considerable part of the expense account of the piano manufacturer, the sewing-machine manufacturer, the furniture manufacturer, the carpet and oilcloth makers, the painter, the plumber, and the druggist; you will see at once how it enters into every industrial pursuit, au d p ow absolutely necessary it is that our people should have its use, as a raw material, free of any tax. Many interests have appeared before you, urging action that they might be protected; but this interest asks at your hands not protec- tion, but that it may not be burdened by a prohibitory, unjust, and ex- cessive taxation. H. Mis. 6 58 914 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. Upon the best authority that can be gathered, as was brought forth in several hearings before the Committee on Ways and Means of the Forty-seventh Congress, the consumption of alcohol, prior to the levy- ing of the internal revenue tax, in arts and manufactures was 35 per cent, of its total production in this country. It is now estimated at 5 per cent., so that, although this tax is so injurious in so many ways, it is so excessive as to be almost prohibitory, and the government derives from it only some three millions revenue per annum. I do not think the statute books of any nation can show a taxation as injurious and as useless. The great injury done our industries by levying a tax on so necessary an article as alcohol has forced itself strongly upon all our best think- ers who have interested themselves in revenue legislation ; and there is no stronger argument for the necessity of this Commission than that Congress after Congress has adjourned without remedying this evil. During its last session Mr. Hewitt introduced his resolution before mentioned. Mr. Kelley, of Pennsylvania, stated that “this tax is re- tarding our manufacturing progress and restricting our exports,” and that “the relief our farmers, manufacturers, and consumers should have is an immediate reduction and the earliest practicable repeal of the last vestige of this oppressive and restrictive tax.” The Hon. Ben- jamin Butterworth, of Ohio, in an argument before the Committee on Ways and Means, on this subject, spoke as follows: It is well known that the rate of tax on distilled spirits was fixed with reference to the fact that spirits are deemed to he a luxury, and it was regarded as a tax upon one of the luxuries. But it will not be claimed that alcohol used iu the arts and for in- dustrial pursuits can he classed as a luxury, nor would it as such he a proper subject of taxation; hence it appears to me that the rule which would impose a tax upon luxuries would not include within its terms or spirit such product of the still which is used solely for industrial purposes ; and, while adhering to the spirit which prompted the enactment of the present law, we should, as a matter of public policy, freely per- mit the withdrawal of alcohol for use in industrial pusuits. And Mr. Willis, of Kentucky, urging the same measure, said : Let us not, with a Treasury full to overflowing, extort further tribute from either science, commerce, or industry; but rather, by wise and beneficent legislation, widen their operations and extend their usefulness. And yet, with this expression of opinion from the leading minds of the two great political parties of this country, and the example of both England and Germany — our great commercial rivals — before them, the Forty-seventh Congress adjourned without granting any measure of relief. Mr. Bower, of Philadelphia, urged upon you the necessity of adding the alcohol tax to your tariff duty on every article imported into the manufacture of which alcohol entered. This proposition is impracticable upon its face, for you cannot determine the amount of alcohol neces- sarily used, and it would be most wretched public policy, tor it urges that because our people suffer from an excessive taxation through in- ternal-revenue laws that you attempt to make the wrong right by add- ing excessive duties to the tariff. There is an easier and better way. It is, to repeal the internal-revenue tax. I think it will be evident to your minds, without further argu- ment, that this alcohol tax upon industry should be removed. The question remains for you to consider how best it can be done. There are but two practicable methods. One, the enactment of such a bill as that introduced by Mr. Willis, of Kentucky (H. R. 5082), during the last session of Congress, and which I append, marked A; and the other, the total abolition of the whole system of internal-revenue taxation. GOLDSBOEOUGH ROBINSON.] ALCOHOL. 915 In regard to the Willis bill, I append, marked B, a full report of the evidence taken before the Committee on Ways and Means, which evi- dence demonstrates, conclusively, the feasibility of the measure. As to the internal-revenue system, Mr. Carlisle, in his great free- trade speech opposing the law authorizing the appointment of this Commis- sion said that it would be impossible to consider questions of tariff without also considering questions of expenditure and income; and thus far I agree with him. If the Commission is organized for the purpose of protecting our in- dustries without regard to revenue, then you must let the whole ques- tion of revenue go. But if it is organized for the purpose of raising revenue for the support of the government and at the same time of protecting our industries, then you must consider the questions which relate to revenue, which is already coming in at the rate of $150,000,000 annually. Now, if this honorable Commission, in considering these questions, shall be able to devise such a system of tariff revenue as shall enable them to recommend the entire abolition of the internal-revenue system, they will be entitled to the lasting gratitude of the whole country. Such a measure will relieve us of the support of four thousand agents of this department, whose unproductive labor costs annually some $5,000,000. It will free our federal courts from thousands of cases which cost the people millions of dollars in expense and loss of time, by witnesses and principals, in cases involving petty infractions of un- known laws and regulations. It will prevent the wounding and killing of over a hundred men annually, whose lives are lost in enforcing laws utterly opposed to the habits of thought and traditions of our people. In conclusion, a certain class of thinkers have heralded this Commis- sion to the world as appointed for the sole purpose of perpetuating and increasing the burdens of the people. It would be a noble answer to this charge if, through measures devised by your wisdom, the people are re- lieved from the system of surveillance, vexatious suits, and useless man- slaughter entailed by this remnant of the war’s miseries called “internal- revenue taxation.” The alcohol question, involving almost every industrial pursuit of our country, and regarded as so grave in England as to be provided for by a special system of laws and regulations, will force you to face this problem, and, in the words ol Mr. Hewitt, of New York, “public senti- ment demands the utter abolition of this whole system,” “the utter and absolute repeal of these internal and infernal taxes.” I deal very lightly with the bill H. R. 5082, because, as a single item of internal-revenue taxation, I did not know that the Commission would care to go into it to any great extent. My remarks apply to the whole subject of internal revenue more especially. By Commissioner Boteler : Question. About what amount of alcohol is used in the arts? — Answer. That was brought out in that hearing before the Committee on Ways and Means, a report of which I have marked B. Before the war about 35 per cent, of all that was consumed was used in the arts and the man- ufactures in this country. But since the war and since the levying of this tax (which almost prohibits its use) it is only about 5 per cent. Powers & Weightman, of Philadelphia, formerly used alcohol largety in the manufacture of quinine. Now they use fusel oil, a poisonous substance. All the inventive genius of this country has been endeavoring for twenty years to find a substitute for alcohol as a solvent. Germany and Eng- land, our great manufacturing rivals, have it free. 916 TARIFF COMMISSION. [GOLDSBOEOUGH ROBINSON. By the President : Q. Are any of these substances used as solvents, complete solvents? — A. Alcohol seems to be a solvent for almost every vegetable growth. Among the substitutes, however, something may be found which is a solvent for one thing, but not for others. Alcohol is nature’s great gift in that direction. By Commissioner Underwood: Q. If alcohol and spirits containing alcohol are admitted duty free, would not that have the effect to destroy the distilleries and do away with the internal-revenue system, so far as it applies thereto? — A. It would, I think, be impracticable to admit it free of duty and then have an internal-revenue duty; and it seems to me that as this Commission is brought into contact with the internal-revenue question, it might recommend the total abolition of that internal-revenue tax. It would be a perfectly legitimate proposition, however, to tax foreign alcohol and allow our own to be made free. Q. Do you think such a measure is needed? — A. Yes, sir, I do; and for this reason, that the distillers last year lost some $300,000 in a pool in exporting alcohol, although they paid no duty. The production was injured to that extent. Q. But would the country be injured? — A. That is all abstract ques- tion of political economy with which I am not now concerned. In regard to Mr. Willis’s bill (H. B. 5082), 1 want to state that I am very familiar with the practical working of the internal-revenue laws from their inception to this time, and I believe that the provisions of that bill, if enacted into a law, can be easily and thoroughly carried out; although I want to state, in perfect candor, that the Commissioner of Internal Be venue is opposed to it. When we go to Congress advocating any measure, we go before the Committee on Ways and Means, the members of which are more or less influenced by local considerations. It is a great boon to the country, in my opinion, that the industrial interests of the country can now come before this body of men gathered from different parts of the coun- try, who are not too largely influenced by local questions or by their hopes and fears in regard to an election to the next Congress. Appendix A. [Forty-seventh Congress, first session.] In the House of Representatives, March 13, 1882. Mr. Willis introduced tlie following bill: A BILL to authorize the withdrawal from distillery warehouse, without tax, of alcohol and other spirits to be used in industrial pursuits. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled , That the Secretary of the Treasury shall giant permission to any firm, individual, or corporation to withdraw from bond alcohol or any spirit contain- ing alcohol, and subject to internal-revenue tax, in specific quantities of not less than three hundred proof-gallons, without the payment of the internal-revenue tax on the same, or on the spirits from which it may have been distilled, for the sole purpose of use in industrial pursuits : Provided , That such spirits shall either first have been mixed with one-ninth of their bulk of methyl or wood alcohol of equal proof strength, under such rules and regulations as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury shall adopt, or that where such spirits shall be with- drawn for use in tobacco factories, or such other industrial pursuits as shall entail their complete destruction so they cannot be recovered by any x>rocess of distillation, said withdrawal and use shall be under such rules and regulations as to bond, stamps, GOLDSBORO UGH ROBINSON, J ALCOHOL. 917 and keeping of books with government supervision as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, shall adopt: And provided further, That any person who shall sell, use, or willfully permit the use of spirits with- drawn under this act for any other purpose than that specified herein shall, for each offense, be fined not less than five hundred nor more than five thousand dollars, and be imprisoned for not less than six months nor more than two years : And provided f uriher, That any violation of the rules and regulations made by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, in conformity with this act, shall be x>unislied by a fine of not less than fifty nor more than one hundred dollars for each offense. Appendix B. WITHDRAWAL OF ALCOHOL WITHOUT TAX TO BE USED IN INDUSTRIAL PURSUITS. Committee on Ways and Means, March 30, 1882, Remarks of Mr. G. Robinson , of Kentucky. Mr. Goldsborough. Robinson, of Louisville, Ky., secretary and treasurer of the Louisville Leaf-Tobacco Company, addressed the committee: Mr. Robinson said: Judge, with your consent, I will read the bill itself. Shall I? The Chairman (Mr. Kelley). Go on as you think best. Mr. Robinson reads H. R. No. 5082, and then proceeds: To the Hon. William D. Kelley and the members of the Committee on Ways and Means: Gentlemen: In considering the “ Willis bill,” which grants the use of spirits in in- dustrial pursuits without tax, there can be but two questions involved: First. Is the object of the bill good public policy? * Second. Are its provisions such as to attain this object, and that without permit- ting fraud upon the revenue ? Alcohol is nature’s great solvent, and is required in nearly all industrial pursuits. In this use it is as absolute a necessity as machinery or a paint brush, and in taxing it we tax a product of our own industry, and through it lay a burden upon our own manufacturers. The tax is so excessive as to be almost prohibitory, and our people are placed at great disadvantage in competition with those of foreign countries who have free alcohol. No government, wisely conducted, will levy excessive taxation on its own industries. This principle is so well established that machinery is in many cities exempt from local taxation. On that point I have listened with a great deal of interest to the debates in the House, and I find that even those who are called free traders did admit and did urge some measure showing some spirit of protection toward our industries, and I am astonished that I should have to stand here to-day, not merely in behalf of protection to our industries, but that an actual blow should not be leveled at our industries, that they should not be positively injured by unwise laws. The only justification of the extreme tax on spirits (it is six times their value) is t he popular belief that they are harmful luxuries and should therefore bear the burden; but this justification fails utterly where spirits are used in manufactures, in the prep- aration of drugs, as a burning fluid, and in all the common wants of the people. This tax being almost prohibitory, every shift has been adopted to escape its burden ; ben- zine (dangerous always) is substituted as a burning fluid, and fusel oil (a poison) as a solvent. All inventions leading in the direction of a use of alcohol are barred. It has great bleaching powers, and might be employed with advantage on textile fabrics, but its cost prevents any experiment in this direction. For nearly twenty long years, the most progressive years in the world’s history, the American people have been prac- tically deprived of the use of this great solvent. Its absolute necessity in scientific pursuits has been admitted, and colleges have been granted, by special enactment, its use without tax, but no provision has been made for that army of humble laborers in the scientific fields, to whose efforts all our great inventions are due, and who have no access to college laboratories. The constantly increasing surplus in the Treasury, the impossibility of applying that surplus to our debt, except by buying bonds at an extravagant premium, forces the conviction on all minds that taxation must be reduced. 918 TARIFF COMMISSION. [GO LDSBO ROUGH ROBIXSOX. What is more reasonable than that this reduction should take place in that direc- tion which will encourage industries, and remove from the burden which the people carry those points of friction which gall and irritate more than the weight of the bur- den itself? The people have made no complaint of the tax on matches, and who will thank the representatives of the people for its removal. But for many years, petition after petition has come to this committee-room for relief from this alcohol tax on industry. I just note a little instance of that. The plumber goes out and buys a box of matches, the tax on which is only two cents. But he is obliged to get a pint of alcohol, and he pays on that a tax of some thirty cents. It bears so unevenly and highly on that side that he feels that the government is robbing him. The Chairman. You say he pays thirty cents tax? Mr. Robinson. He pays about thirty cents for the alcohol, or twenty-two cents tax. There can be no relief granted which will accomplish so much with so little cost to the revenue, for it must be borne in mind always that it is not only the amount paid but the practical prohibition which is burdensome. Before the war it was estimated that one-third of the spirits p oduced were consumed in industrial pursuits; now the most careful estimates made by parties in a position to know are that only one-twen- tieth of the amount produced is consumed in arts and manufactures. Relief granted, therefore, from this oppressive and prohibitory tax upon a necessity will only reduce the revenue some three millions of dollars (one-twentieth of sixty millions, the total amount collected on spirits), but will aid the industries of the country in many times that amount. For authority for estimate see note appended. There can be no question as to the good policy, indeed, more than that, as to the necessity of the passage of this measure, provided it can be done with safety to the revenue, and it will be found on examination that this bill provides absolutely for this safety. In considering this part of the subject it should be remembered that the general feeling of fear of fraud upon the revenue has been engendered by the difficulties which occurred in enforcing the laws during and immediately after the war, and we are apt to overlook the fact that those laws are now easily and thoroughly executed. At that time the people were in a state of turmoil, and the foundations of society seemed broken up; now order has regained its sway, and the convictions which followed each other with such rapidity in the United States courts have taught a wholesome fear of the United States laws. It should also be remembered in considering this question of possible fraud that no law and no government supervision can hold the people so closely that they can- not commit fraud, but that the laws are enforced by the good moral sense of the great majority of the people, and by the fear of the penalties on the part of the evil disposed. Now, in considering this question, also consider the fact that any manufacturer can take his tobacco out of the back door without paying the tax, and can refill stamped packages and sell them again. That any retail druggist in Washington or in any other city can make all the alcohol that he wants; but why do they not do it? The government has no record of these druggists. They do not want to, because the great bulk of the American people want to obey the laws. They won’t run the risk of the penitentiary. Our immense internal-revenue tax is collected practically without fraud, by the use of four simple provisions in our laws ; they are — the giving of bonds, the use of stamps, the menace of a penalty, and reasonable government supervision. With these safe- guards highly taxed articles are allowed to enter every avenue of trade, and to be transported through every part of this vast country. Now, if the government can, by these simple means, enforce the collection of one hundred and thirty-five millions of dollars per annum of internal revenue, it can cer- tainly, with the greatest safety, remit to the people this tax of three millions on their industries by the use of the same provisions. You will observe that the bill provides for two classes of use, one that of spirits first adulterated with methyl or wood alcohol, and the other for its use pure in such man- ufacturing processes only as shall entail its ultimate entire destruction, so tha t it shall not leave the factory in any form from which it might be recovered by distillation. Under this first provision the manufacturers of Great Britain have been supplied with free spirits for over twenty years, and this adulteration with methyl has been found a practical method of preventing any fraudulent use. Methylated spirits under this bill would be the common and popular use of alcohol by individuals, and in the smaller and more numerous industrial pursuits, and this use, as proven by experience, would be abundantly protected. The second use provided for in those manufactures requiring pure spirits would be under the regulations of the Commissioner; and this use can be as carefully guarded, and by the same means, as the sale and use of spirits and tobacco now are. The regulations necessary to this end the bill leaves wisely to the discretion of the GOLDSBOROUGH ROBINSON'.] ALCOHOL. 919 Commissioner. He can best meet the exigencies of the trade, or any necessity for the prevention of fraud, and under its provisions he has ample power to accomplish either. To sum the whole matter up, this tax is opposed to every principle of good public policy, to every dictate of sound business sense, to the kuown principles which should govern the levying of taxes, and to the customs wisely pursued by our commercial rivals. The government has no need of the revenue derived, and the people pray for relief. This relief can be readily given by means well known and already in practical use iu Great Britain and under the revenue laws of our own country. The question is, gentlemen, will you grant it? Now, if I can answer any questions, I will be glad to do so. Mr. Randall. Do you believe, Mr. Robinson, that if we should exempt spirits that shall be used iu industrial pursuits that it will occasion the going back to the former rate of consumption of alcohol for these industrial purposes, as it existed before the war, to wit, 33 per ceut., from what it is now, 5 per cent. ? Mr. Robinson. I do not think, sir, it would, for this reason : it was used as a burn- ing fluid then. Now they use benzine for that purpose. Iu a Dew industry the mo- ment a manufacturer is called upon to use alcohol he has to quit; and it v\ ouid be a number of years before other uses would be found to increase it. Mr. Randall. Then you do not think it would increase for some years, as the use of benzine is iu the way now? It would if it would destroy the use as applied iu the industries of fusel oil, because that is a poison. Mr. Robinson. I understand the use of fusel oil is kept very quiet ; but I under- stand there is a good deal of it has come into play since the disuse of alcohol. Mr. Randall. Then you do not wish to express any opinion ou that? Mr. Robinson. I do not wish to make any expression of opinion on what I have no positive knowledge of. Mr. Randall. Then you clealrly believe that this change and exemption of alcohol used iu the industrial pursuits would provide a new purchaser of spirits in this country ? Mr. Robinson. In a great many directions at once, and in a great many directions in the course of time. You see if you deprived tbe people of the use of a thing for twenty years, they will only gradually increase the use of it when it is free again. * Mr. Randall. Then if we exempt alcohol for the purpose, indicated in this bill, or whisky rather, from taxation, is there any necessity for the use of what is called wood alcohol? Mr. Robinson. There would be a necessity under the provisions of this bill. Mr. Randall. Yes, I know ; but this bill allows for the use of pure alcohol. Mr. Robinson. No ; 10 per ceut. of the mixture is methyl. Mr. Randall. And you state that the alcohol can never be got back. Mr. Robinson. No, sir; it cannot. Mr. Randall. If we were to exempt spirits and alcohol for industrial purposes it would not be necessary at all to use that 10 per cent, of wood alcohol, would it? Mr. Robinson. Yes, sir; it would be necessary for all common uses. Mr. Randall. I do not quite make myself understood — whether these purposes for industry iu the United States — whether they would necessarily have to use the wood alcohol in them. Mr. Robinson. Underthis law they would be obliged to use the wood alcohol. Mr. Randall. That is what I want to get at. Then why need we mention anything about the mixture of wood alcohol? Mr. Robinson. If you let the people generally have pure alcohol they could use it for drink I they might use it in place of the taxed article. Mr. Errett. Why does the bill provide that the alcohol be adulterated with methyl ? Do you think that 10 per cent, is a protection for the government ? Mr. Robinson. It has been proved by the English Government, who have had it in use for twenty years. . Tbe Chairman. Mr. Robinson, is it true that the English Government, and I think also the German Government, have allowed the use of alcohol otherwise than methy- lated — otherwise than as this bill provides ? Mr. Robinson. No, sir; I think not; but I tbink the American people ought to take oue step in advance. The English Government, in order to collect a tax on to- bacco, do not allow the people to grow their tobacco at all. But we have been able to collect a tax and yet allow the people to grow tobacco. We provide iu this bill for pure alcohol to be used only in certain processes where it is destroyed, under the rules and regulations of the Commissioner of Internal Revenue. Mr. Kasson. Give us an illustration of where that pure alcohol — unmethylated — might be used and who will use it. Mr. Robinson. All the tobacco factories would use it, all large chemical establish- ments, like Powers & Weightman, of Philadelphia, would use it. . Mr. Kasson. How about the smaller manufactories ? 920 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. Mr. Robinson. Any small manufacturer or druggist might use it. Mr. Kasson. How do you propose the government shall secure itself in all these cases? I do not speak now of great factories ; I speak of the general business. Mr. Robinson. I will speak of the small druggist who wants 300 gallons of pure alcohol for use in a direction where it would be completely destroyed. He would make application through his collector to the Commissioner of Internal Revenue for per- mission to withdraw that 300 gallons of alcohol, and he would file, with good security, a hond for double the tax on the alcohol as indicated, and get it without paying any tax on it. He would get his alcohol and formal permission for the use of it, and take it to his drug store. Now, then, he is in the same position that the tobacco manufacturer is who has to use the tobacco only in certain ways. And we will suppose that the Commissioner has ruled that he must make, under oath, a monthly return similar to that of the tobacco manufacturer, showing the date on which that alcohol was withdrawn, the purposes for which it was used, &c., when and how it was con- sumed, with such other proof as the Commissioner might require; and when that proof was made, the Commissioner would surrender and cancel the bond. Mr. Kasson. The government would rely on the oath — the real security is the oath? I want to get at where the real security comes to us — upon the character of the proof. Mr. Robinson. And the character of the use also. The man cannot go up there and just swear alone. Mr. Kasson. I know; but he swears to these details? Mr. Robinson. Yes, sir. Mr. Kasson. In other words, the Commissioner depends upon the oath as to the use of the alcohol ? Mr. Robinson. Precisely. Mr. Kasson. What I want to get at is the ultimate security for faithful compliance with the provisions of the law. Mr. Robinson. Mr. Kasson, as a matter of comparison, though, any retail drug- gist in Washington can make his own alcohol. They can all do it, but they do not. Mr. Kasson. I only wanted to get the details. Mr. Robinson. The ultimate security of the government would be his oath — his statement of how and when used; the reasonableness of that statement, and the fact of the government official going to that man’s place of business at any time and see- ing his books would give government inspection to see about all his operations. Mr. Kasson. As to the question asked by Mr. Randall, I suppose you do not feel inclined to give an opinion as to the use of fusel oil. Mr. Robinson. I cannot give you a positive answer. My opinion would be just this: that the use of fusel oil has come in since the high tax on alcohol ; so I believe that if the tax is put back to the old standard the use of fusel oil would go out. Mr. Kasson. As I understand it, you only think that this can be takeu out of bond without tax, wlwn 10 per cent, of wood-alcohol is put with it? Could that mixture be used for perfumeries, medicines, &c. ? Mr. Robinson. No, sir; that class of medicines that go out into the country with alcohol in them must have the pure alcohol. There can be no provision made in any bill that can be drawn to exempt it, because that alcohol can be recovered. Mr. Errett. How are you going to prevent fraud? Mr. Robinson. There canuot be fraud under the provisions of this bill; it is im- possible. Mr. Errett. Can he withdraw as a manufacturer for export ? Mr. Robinson. Yes, sir ; but not for sale. Mr. Errett. No exemption for its sale in this country? Mr. Robinson. No, sir. Mr. Randall. Mr. Robinson, on page 8 of the table from which you read is given the estimate for the production of whisky at 90,400,000 gallons, and it gives the detail of the purposes for which it has been used. Mr. Robinson. That was furnished by the Census Bureau, from figures of 1860. Mr. Randall. I did not know what year you referred to; but I was going to make this remark. Mr. Robinson. That was before the war. Mr. Randall. Now, the whisky imported last year, according to the figures you will have from the census report, was 15,921,482 gallons of spirits. Have you any means of giving us the figures for 1880, in like manner as given for 1860 ? Mr. Robinson. No, sir; and those figures cannot be obtained in Washington. I got them from men acquainted with the business. It was as near as I could get it. Mr. Kasson. How far would this principle for methylated spirits alone operate — near about what proportion of the mixture used would result from methylated spirits alone ? Mr. Robinson. I suppose about one half. There are no figures on this subject, un- fortunately, Mr. Kasson. Then we have, say, for the use of methylated spirits. Now, GOLDSBOROUGH ROBINSON. | ALCOHOL. 921 suppose we go a step further and grant its use where we have already government su- pervision of it, in tobacco manufacture. That would be about -fij, making with the other tV Now, if we embrace all the other uses it may he applicable to, being the other -nj, my object was to see how far we could accomplish the general results by adopting the well-known methods of methylated spirits, and extending them to pure spirits in establishments where we have government supervision. The Chairman. It is due, Mr. Robinson, that I should state that I have interro- gated the heads of several large establishments who are immense consumers of alcohol, but now use fusel oil and other solvents, as to the passage of a bill like this, and the responses I get are uniformly to the effect that, having petitioned Congress from year to year to give them free spirits in the arts and failed to obtain it, they have now adopted other machinery and processes. They have resorted to other methods, and would be slow to return to the use of spirits, except in the introductiou of new branches for the substitution of worn out machinery, if alcohol were free ; so that I doubt whether there would be anything like so large a consumption of methylated spirits as the gentleman may think. Mr. Robinson. I wish to read an extract from a letter of Messrs. Powers & Weight- man, of Philadelphia, on the point that Judge Kelley makes: “Our views have not changed since we had the pleasure of meeting you at our office. While we would gladly avail ourselves of free alcohol, provided it could be employed without government espionage, and cleared of all official restrictions, interference, and surveillance, we are not at all desirous of subjecting our affairs to the inspection of any one not connected with the business in which we formerly used more alcohol than we do now. The high price, due to the tax, forced us to adopt other solvents, to some extent, and obliged us to change our process, &c., to conform with the altered condi- tion of affairs. It would be no object to change again, unless we were allowed to use spirits, as we did before the war, the same as any other merchandise owned by us. J ’ Mr. Weightman gave me another reason when I was there. They are an honorable, old, and wealthy firm, too well known to require praise at my hands to this commit- tee. They say they have never been in the habit of giving bonds. If they give bonds they have to ask people to go on their bonds, and then they have to go on other peo- ple’s bonds. . Mr. Randall. They would rather go on the cash basis? The Chairman. Yes. When they can show a $21,000 spirit-tax receipt; they got one from the United States marshal. Mr. Randall. Have you ever made an estimate of the amount that would be ex- empted under the provisions of this bill ? Mr. Robinson. The nearest I can make it, sir, is about 5 per cent. Mr. Randall. You say that it is $3,000,000 ? Mr. Robinson. Yes, sir ; and a little over. Mr. Haskall. Is the preparation you take the British preparation ? Mr. Robinson. Yes, sir. Mr. Haskell. I went over and smelled that on the table. I am not very skilled at such things; but it strikes me that that would be used outside of the arts. The odor is not particularly obnoxious. I wanted to ask if the proportion of -g- could not be made f? Mr. Robinson. Mr. Kelley pronounces methyl the skunk of the spirits. It would only make it that much more disagreeable. Mr. Haskell. The English have no temptation to make improper use of spirits, have they ? Mr. Robinson. I think the tax there is much higher than ours. The Chairman. You have in your room plenty of methyl and fusel oil, and you will probably find that it is not particularly agreeable. . Mr. Robinson. I want to leave with your reporter a copy of the Oil, Paint, and Drug Reporter, published in New York. It represents the trade of all the United States, and it lias a most urgent editorial in favor of this bill, in its last Issue (March 22 ). The Chairman. The reporter will include that editorial in the report of these pro- ceedings. Following is the editorial referred to : THE ALCOHOL TAX. The following is the text of a bill introduced in the House last week by Congress- man Willis, of Kentucky: Be it enacted by the Senate and House of Representatives of the United States of America in Conyress assembled , That the Secretary of the Treasury shall grant permission to any firm, individual, or corporation to withdraw alcohol, or any spirit containing alcohol, and subject to internal-revenue tax, in specified quantities of not less than three hun- dred proof gallons, without the payment of the internal-revenue tax on the same or 922 TARIFF COMMISSION. [GOLDSBOBOUGH ROBIXSOX. on the spirits from which it may have been distilled, for the sole purpose of use in in- dustrial pursuits. Provided, That such spirits shall either first have been mixed with one-ninth of their bulk of methyl or wood-alcohol of equal proof strength, under such rules and regulations as the Commissioner of Internal Revenue, with the approval of the Sec- retary of the Treasury, shall adopt, or that where such spirits shall be withdrawn lor use in tobacco factories, or such other industrial pursuits as shall entail their com- plete destruction so that they cannot be recovered by any process of distillation ; said withdrawal and use shall be under such rules and regulations as to bond, stamps, and keeping of books with government supervision as the Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, shall adopt. And provided farther, That any person who shall sell, use, or willfully permit the use of spirits withdrawn under this act for any other purpose than that specified herein, shall, for each offense, be fined not less than five hundred nor more than five thousand dollars, and be imprisoned for not less than six months nor more than two years. And provided f urther, That any violation of the rules and regulations made by the Commissioner of Internal Revenue, with the approval of the Secretary of the Treas- ury, in conformity with this act, shall be punished by a fine of not less than fifty nor more than one hundred dollars for each offense. The relief for which this bill provides has long been contended for by this journal. Taxing distilled spirits used in manufactures is to the last degree exorbitant and un- necessary, and is as burdensome to the people as would be a tax upon the grain from which it is produced. Hundreds of manufactures, now in a nourishing condition, and which are vitally essential to our national prosperity, could not exist were it not for this useful material which enters into their processes, or products, aud a tax upon it therefore becomes one upon the very substance of the community. An offspring of war legislation at a time when it was necessary to swell the revenue of the country by every means in the power of the government, it has since been continued under a mistaken system of economy which taxes the present generation for the benefit of pos- terity. It has been pleaded on the part of the government that the tax was necessary to the speedy reduction of the public debt, but the fallacy of this claim is readily ap- parent. The loss of the amount collected from alcohol might be counterbalanced by an increased protection to American industries in the shape of import duties upon articles of luxury which would not affect the great mass of the people. It is mani- festly unfair, for the purpose of saving the interest upon a certain amount of bonds, annually to draw trom the pockets of the laboring classes an amount of tax upon the essentials of their daily subsistence equal to both principal and interest of these bonds, especially in view of the fact that not we, but our survivors, are to reap the benefit of this drain upon our pockets. The political economy of this question in- volves too many subtleties to be discussed at length here, but it may be sufficient only to say that opinions as to the advisability of reducing the national debt to a merely nominal point differ as widely as upon most other questions of a kindred character, and in view of this contrariety of opinion the abrogation of the tax upon alcohol used for manufacturing purposes could certainly not meet with a degree of opposition from the people which would make it a serious step for Congress to undertake, even if the amount so withdrawn from the revenues were not raised by some other method. It is probable that the opposition to such a measure would and does come from a wholly different source, namely, the office-holding class, who would see ki the taking off of this tax a large amount of patronage and political power removed from their grasp. The influence of this class with Congress is too well known to be ignored, and can only be overcome by the strenuous efforts of the people themselves. Our repre- sentatives must be made to understand that it is the general desire of the community that they no longer be required to pay a tax upon a domestic product which is fully as essential to their comfortable existence as the bread which they eat. We are desir- ous of seeing this proposed bill become a law, and feel assured that the manufacturing industries we represent are in full sympathy with us in this matter. We therefore call upon all who feel an interest to exert their influence with their respective Representa- tives to secure its passage. A powerful movement in this direction may reasonably hope to overcome the efforts of the lobby, which will certainly be put in active opera- tion to defeat it. Let the friends of the bill now come to its support, and such influ- ence as this journal is able to exert will be cheerfully accorded the enterprise. Mr. Butterworth said: Mr. Chairman, I came with my friend Robinson to bear my testimony in favor of the measure under consideration ; but I doubt if I can add anything to what he has already said, and said so admirably. It is well known that the rate of tax on distilled spirits was fixed with reference to the fact that spirits are deemed to be a luxury, and it was regarded as a tax upon one of the luxuries. But it will not be claimed that alcohol used in the arts and for indus- G0LDSB0R0UGH ROBINSON. J ALCOHOL. 923 trial pursuits can be classed as a luxury, nor would it as sueli be a proper subject of taxation; hence it appears to me that the rule which would impose a tax upon luxu- ries would not include within its terms or spirit such product of the still, which is used solely for industrial purposes ; and, while adhering to the spirit which prompted the enactment of the present law, we should, as a matter of public policy, freely per- mit the withdrawal of alcohol for use in industrial pursuits. The Chairman (Mr. Kelley). Will you permit me to ask if the manufacture of alco- hol might not be counted among the industries upon which we ought not to impose a tax? Mr. Bijtterworth. I agree that it is an industry, but it does not follow because we were compelled under the stress of public necessity to tax what my friend is pleased to term an industry that we shall not remove a part of that tax because we are unable to remove it all. In the main, there has been no disposition to complain of the tax upon distilled spirits, in view of the fact that it has been regarded as a tax upon a luxury to the extent to Avhich it was used for drinking purposes, but I feel assured that if the entire product of our stills had been used, or was used in the arts, and for industrial pursuits, no such taxation would have been tolerated, for then it would indeed have been tax- ing our industries. The object of the measure now under consideration is to tax the luxury, but to remove it from our industries. The Chairman. Why, one bushel of corn will carry four in the form of alcohol. Mr. Butterworth. I will not discuss that with my friend, although I would will- ingly do it at another time. The point he makes is that the internal-revenue tax should be removed altogether. It must occur to my honorable friend that, if it is bad as a whole, it is bad in every part, and I submit to him that he ought not to hesitate to correct the evil, even as to a part. It must be clear to this committee that alcohol used in the arts and industries is not used as a luxury, and whatever reason there may exist for abolishing the entire revenue tax on distilled spirits, that same reason applies with greater force to taxing that part of the product of our stills which is used as an element in industries. The honorable Mr. Chairman complains that even this measure might work a hardship in some direction. I have to say in reply to that-, that if it is expected that I can suggest a measure, which shall, while accomplishing good, work no inconvenience to any one, 1 readily submit that I cannot do it. The divine hand alone can trace a law that will accom- plish that. It is impossible to suggest a measure, which shall meet the wants of all men in one direction, aud yet produce no attrition* in any quarter. All taxation is a hardship upon those who have to pay it. Our purpose is to render that hardship as little onerous as possible. While this measure does not look to making drinking easy, it does not make manufacturing hard. As to the practicability of making this law without opening the doop to fraud, I am thoroughly satisfied. Those of you who are and have been familiar with the provisions of the internal-revenue law, know that that law has been so perfected, and is so administered as to render the commission of fraud almost out of the question, and it seems almost impossible to commit fraud without being detected sooner or later. Each withdrawal of alcohol under regulations prescribed would designate the pre- cise object and purpose for which the alcohol so withdrawn is to be applied or used. So that the quantity and use would be distinctly knowm, and the trade as well as the officers of the government would know, with reasonable certainty, whether the product of the alcohol bore a proper proportion to the quantity of alcohol used, just as in the tobacco trade the manufacturer makes a return not only of the quantity of tobacco pro- duced and used, but of othermaterials. Now, it is well known to the trade and to the officers of the government about what the product of a tobacco factory ought to be, when the quantity of material purchasedis known. So with officers of the government, in de- termining whether frauds are attempted by the manufacturers of tobacco, they do not rely solely upon the oath of the manufacturer, but the whole of the material used in the product of the manufactured article is taken into account, and they are enabled thus to determine with great accuracy whether the amount produced bears a proper ratio to f he material used. So in this case. And beyond that this bill provides that for certain uses the alcohol should be adulterated, so that while it would still be tit for the pur- poses intended, it would, nevertheless, be unfit for drinking purposes. The Commissioner of Internal Revenue will, I am sure, explain to you that he ap- prehends no danger in the direction of frauds upon the revenue, that he will be abun- dantly able to prescribe rules aud regulations which shall place it practically beyond the power of parties to commit frauds without detection. The penalty for fraud is so great"., the certainty of detection so probable, and the profits resulting from the com- mission of frauds so insignificant, that there is hardly any probability of its commis- sion. 924 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. If may be said that I represent a district largely interested in tlie manufacture of distilled spirits. So I do ; and for that reason am familiar with that industry ; with its relation to the general legislation of the country ; with its needs and requirements, and the opportunities which ought to be afforded for its healthful growth ; and I only ask for that industry the fair protection and consideration which is accorded to others. ******* Mr. Errett. So far as tobacco is concerned, you apply it to that. How is it when it comes to druggists, who object to the examination of their books by the officers of the government, ? Mr. Bvtterworth. In reference to that, I have only to say that so far as any ex- amination of books is necessary to ascertain whether frauds have been committed, permission could not la wfully be refused. If such firms as my friend refers to in Phil- adelphia are pleased to place themselves in an attitude of posing above and outside of the law they may abstain from availing themselves of the provisions of this bill. The regulations prescribed by the Treasury Department to secure the government against fraud would work no hardship upon any honest industry or business. I desire to add, that it is generally conceded that a reduction in the amount of in- ternal revenue collected is not only entirely practicable, but desirable; and it appears that the reduction growing out of the removal of the burdens from the various indus- tries using alcohol would reduce the revenue not to exceed three or four millions at the outside. It seems to me that every consideration of public policy demands that this bill should speedily become a law. Mr. Willis. Mr. Chairman, in reply to the question of Mr. Errett as to the number of pursuits which would be benefited by this bill, I would state that my information is that twenty or thirty different and important branches of industry would be benefi- cially atfected by it. Take, for instance, two industries that were cited by you, Mr. Chairman, when this bill was before the subcommittee — that of the carpet manu- facturer and the plumber. Both of these require alcohol, and this high tax of $1.80 per gallon enters into and forms a part of the cost of the work which is paid by the consumer. The Chairman. Unhappily the carpet men could not use methylated spirits. Mr. Willis. I think you will find upon inquiry that they can ; but whether that be true or not does not affect the proposition as to other equally important trades. I am not prepared, however, here and now to give a list of these trades, but before the consideration of the bill is concluded by the committee I will, with its permission, submit a st atement as to the number and character of the arts and manufactures which now use alcohol or would use it except for the present exorbitant tax. And in this connection let me suggest that in many medicinal preparations where alcohol should be used various substitutes — and these often deleterious to health — have taken its place. If, therefore, this bill will secure to us purer drugs, would not that fact alone be sufficient to insure its passage? What higher duty is there upon us as Representatives than to promote and protect the health of the people? What subject to-day is exciting more discussion than the adulteration of our drugs and of our food ? If we can remove all temptation, so far as the use of pure spirits is concerned, to employ injurious or poisonous substitutes, ought we not do it, and do it promptly ? Will any gentleman upon this committee admit, for instance, that fusel oil is a proper ingredient in the manufacture of quinine? It has been stated by a gentleman who addressed this committee a few weeks ago upon another subject that since the removal of the duty on quinine fusel oil was used in its preparation, and that he knew it because he supplied it for that purpose. He further stated that he for that reason had quit using quinine. The Chairman. That gentleman is mistaken. Mr. Willis. I do not pretend to assert that such is the fact, and am glad to know that he was mistaken. Mr. Haskell. I was told by a druggist that there was not a particle of fusel oil in quinine. Mr. Willis. I accept the correction most cheerfully ; but. however it may be with quinine, we know that in the manufacture of varnish and numerous other articles alcohol has been supplanted by substitutes by no means as satisfactory to the manu- facturer or the cousumer. But passing from that point, I submit toyou, Mr. Chairman, that the principle of this bill has already been formally approved by this committee. What is that principle? It is that spirits shall be taxed only when used as a luxury. How fiave you recognized that principle ? By unanimously reporting a bill for tlie abolition of all taxes upon proprietary medicines, except where there was 20 per cent, of alcohol. The Chairman. That provision is not in the bill. Air. Willis. I have not seen the bill, and was, then, misinformed. But if that pro- vision is not in it the recognition of the principle is only the stronger. The committee GOLDSBOROUGH ROBINSON ] ALCOHOL. 925 Las tLen declared that the whole duty shall be abolished regardless of the percent of alcohol. It has so declared because these proprietary medicines— especially to the p 00r — ar e a necessity. If this were absolutely true, then the use of alcohol in the arts and manufactures, and the use of alcohol as a constituent part of many proprietary medicines, would be on the same footing, and both would be equally entitled to exemp- tion from duty. But the use of alcohol in the industrial pursuits is purely a necessity and never a luxury, while its use in very manj of the proprietary medicines is not as a medicine but as a beverage. Is it not a well known fact that a large percent ol the so-called “ tonic bitters, 77 “ elixirs vjtse, 77 &c., &c., are but thin disguises for the pure “juice of the corn, 77 and are bought and drunk by many who have conscientious scruples against the “ straight 77 article ? To this extent, therefore, this committee has gone beyond the exemptions of this bill. If the war tax is to be removed from alcoholic proprietary medicines, why not remove it from the arts and manufactures'? But, sir. not only will the arts and manufactures be benefited, but the passage of this bill will also help the great farming interests of the country. Before the war, when alcohol was free, the statistics show that 33 per cent, of all the alcohol used was for industrial purposes. Since the war, or since the imposition of this tax, it has been driven from its former and legitimate uses, and now it is estimated that only 5 per cent, is so used. We have seen how the manufacturer and consumer have suffered by the substitution of other solvents and iugredients. Let us inquire how the agriculturist may be benefited by its reintroduction. The Chairman. How is that? Mr. Willis. By increasing the demand for his grain. You put back alcohol in its old place in the arts and manufacturing and you compel our distilleries to increase their production. From the last report of the Commissioner of Internal Revenue I find that there was used for distilling during the fiscal year ended June 30, 1881, of corn 23,109,000 bushels; of rye, 4,030,000 bushels; and of barley, 2,579,000 bushels. It is well known that a large part of the corn thus used is of an inferior and unmar- ketable quality. Much of it, if not taken by the distiller, would rot in the granary. If you create new uses for alcohol, or restore it to its former uses by making it free of duty, as this bill provides, there would be an immediate increase in its production, and a corresponding benefit to our farming interests. I am the more encouraged to hope for favorable action on this bill, because since I appeared before the subcommittee its scope has been enlarged, so that the objection then urged that it benefited only one branch of business — the manufacturing of tobacco — does not exist, since the bill, as now presented, embraces all industrial pursuits. Moreover, your committee, since then, has, by its action, declared two things: First, that the present revenue was entirely too large and should be reduced. You declared this by presenting a bill reducing the tax on whisky from 90 to 50 cents per gallon, and also reducing the tax on tobacco, beer, &c. The amount of these reduc- tions per annum was somewhere in the neighborhood of $70,000,000. The subsequent judgment of the committee was that these reductions on tobacco and whisky should not be made. Why this change of opinion? Was it not largely due to the opinion that the public sentiment of the country would not justify the removal or reduction of tax upon articles of luxury, such as whisky and tobacco, unaccompanied by any reduction of the duties on the necessaries of life? I am not here to discuss the pro- priety of this committee’s final action on this subject. I accept it, however, as con- clusive upon this Congress. What then follows? Your committee have decided that sixty or seventy million of internal-revenue taxes should be removed, and you have decided that you will not remove them from beer, whisky, or tobacco. Where, then, or upon what subjects, shall this reduction be made? You have partly answered that question by presenting the bill to which I have already alluded, removing the duty on bank deposits, proprietary medicines, reducing the charge for licenses of retail deal- ers of whisky, &c. But it appears that the very largest sum that will be derived from these various sources would not exceed thirty million dollars, which is not one-half of the amount which the committee has decided should be taken off. Where, then, will you make up these thirty or thirty -five million? Where can it be done with more justice and with greater advantage to the whole country than by giving free alcohol to the arts and manufactures? The whole amount of revenue which would thus be taken off, according to the best estimates which have been presented to me, would not exceed three and one-half million dollars. The increased production of al- cohol that might result from the passage of the bill would not decrease the amount now used as a beverage. The tax upon spirits would still yield its sixty or seventy millions of dollars per annum, increasing yearly with our increasing population and foreign demand. What objection, then, can be presented to the bill? Will it be con- tended that it opens the door to fraud? Mr. Errett. The point that I want to make is, that you will here confine this ad- vantage to the tobacco manufacturers; or, if it extends to all interests, speak of it. Unless you adopt a very expanded system of inspection it cannot be made to work, and we have got to provide for that. We have a check upon the tobacco manufact- 926 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. urer, but this lets in every paint shop, every plumber shop, and every druggist, every manufacturer of paints and chemicals. Mr. Willis. The bill provides for the withdrawal of free alcohol by two classes of consumers. The first class embraces all those industrial pursuits where the use of such spirits “entails their complete destruction, so that they cannot be recovered by any process of distillation.” This class includes the manufacturer of tobacco. The second class embraces those industrial pursuits who can use and do use for their pur- poses alcohol which is not perfectly pure, and which do not involve the complete de- struction of the spirits. As to one portion, and the largest one, of the first class, the manufacturer of tobacco is, as this committee well knows, already under the com- plete surveillance of the government. The most cursory examination of the existing rules and regulations will show this. The percent, of industries other than tobacco which require pure alcohol is, as shown by Mr. Robinson, exceedingly small. The same regulations now in force as to tobacco manufacturing, or other equally efficient regulations, can be applied to this first class of industries. Mr. K assoist. I want to ask whether, under your bill, the Secretary of the Treasury would confine the benefits of free alcohol withdrawn to concerns that used a certain amount per month? Mr. Willis. There is no limit as to amount fixed by the bill, but the bill is broadly drawn, so that any regulation that he adopts becomes a part of the bill. Mr. Kasson. The use of pure spirits in establishments are now under governmental supervision ; and when they are to be used in the industries the question is whether we can reach them under the provisions of the bill. Mr. Willis. The withdrawal of such spirits without duty is authorized by the bill, but the method of withdrawal, the place where, the person by whom, the conditions upon which the withdrawal shall be made are left to the Commissioner of Internal Revenue. If any manufacturer is unwilling to submit to the rules and regulations which may, under the bill, be prescribed, he will not be permitted to withdraw the alcohol without tax. If the Commissioner finds that he cannot make such rules as will protect the government this bill will be inoperative. I do not doubt, however, but that proper rules can be made by that officer. I have said that this committee has already indorsed the principle of this bill. Our statute books bear witness to two instances in which the same principle has been al- ready embodied into laws. “Free alcohol” is now and very properly allowed to “any manufacturer of medicines, preparations, compositions, perfumeries, cosmetics, cor- dials, and other liquors for export.” (Supplement Revised Statutes, p. 533.) This withdrawal is “under such regulations and requirements as to stamps, bonds, and other security as shall be prescribed by the Commissioner of Interual Revenue.” The execution of the bill I am now considering is confided to the same officer, and with equally liberal discretion. If he has been successful in administering this “free al- cohol” law in one instance why question his ability in the other? Is there not the same room for fraud in both cases? In this connection, as suggesting the means of executing this bill, I call attention to Revised Statutes, section 3433. But, Mr. Chairman, as your committee is well aware, an act was passed February 21, 1873 (Revised Statutes, section 3297), which further recognizes the principle of this bill by authorizing the withdrawal of alcohol in specified quantities, “without pay- ment of the internal tax on the same,” for scientific purposes. At first this privilege was accorded only to an “incorporated or chartered scientific institution or college,” but subsequetly, on May 3, 1880, it was extended to such institutions even when un- incorporated. How is the government protected against fraud here? Simply by a “bond for double the amount of the tax on the alcohol to be withdrawn”; and the only penalty for using such alcohol for other purpose is the payment of double tax on the whole amount withdrawn. Here, then, we have twice passed laws giving “ free spirits ” Will any one say that these laws have not been an advantage to our commerce and to our people? But while we, lor some reason yet to be explained, and with a willful disregard of our best interests that is lamentable, have given to our people “free spirits” in only these two instances, our rivals in trade, Germany and England, have for many years extended the same relief to all. As far back as June 26, 1855, England has had upon her statute books “An act to allow spirits of wine to be used duty free in the arts and manufactures.” (Chapter 38, 18 and 19 Victoria.) The law has approved itself there ; it has fostered the arts and sciences, and been a “very present help” to the great in- dustrial interests of the United Kingdom. Why should we not adopt its principles and give its benefits to our own people? It' the tax on spirits is to remain, let it be upon them as a beverage, as a luxury, not as a necessity. Let us not, with a Treasury full to overflowing, extort further tribute from either science, commerce, or industry, but rather, by wise and beneficent legislation, let us widen their operations and extend their usefulness. I thank you, Mr. Chairman and gentlemen of the committee, for the privilege of offering these hasty suggestions, and for the courteous attention which you have given them. GOLDSBORO UGH ROBINSON. J ALCOHOL. 927 WITHDRAWAL OF ALCOHOL WITHOUT TAX — (H. R. 5082.) Statement of Hon. Green B. Baum, Commissioner of Internal Revenue. Washington, April 4, 1882. The committee having under consideration H. E. 5082, to permit the withdrawal without tax of alcohol and proof spirits for use in the industrial arts — Hon. Green B. Eaum, Commissioner of Internal Eevenue, appeared by invitation, and made the following statement : Mr. Chairman and Gentlemen ; This bill provides for the removal of spirits mixed with wood alcohol to be used in manufactures, and also for the withdrawal of spirits to be used by manufacturers who are unable to use methylated spirits. I think that every person recognizes Ihe importance of cheapening all the materials that enter into manufactures in this country, especially where the raw material — as you would class alcohol when introduced into manufactures — is produced from other important products of our country whose value would be iucre,ased by the increase of its con- sumption. The difficulty to be encountered in the passage of this bill (H. E. 5082) is to make provision against these spirits that are allowed to be withdrawn for use in the arts and manufactures from entering into consumption as potable articles in com- petition with tax-paid spirits. Mr. Kasson. Please state that again. Commissioner Eaum. I say the important question to be considered here is whether you can arrange for alcohol to be introduced into the manufactures and arts with- out at the same time opening the door to fraud and to its diversion from those legitimate uses to the ordinary use as a beverage, in competition with tax-paid goods. The only legislation, as far as I have any information upon the subject, that you can draw upon for instruction is the act of 1855, passed by the British Parliament, which authorized the mixing of methyl or wood alcohol with spirits to be used in the arts. Mr. Errett. Hid that allow any withdrawal except of mixed spirits? Commissioner Eaum. No, sir ; it did not. Now, the experience in England has been that the use of methylated spirits has increased from 290,000 gallons in 1867 to 1,500,000 gallons at this time. Mr. Eandall. From what authority do you quote those figures? Commissioner Eaum. The figures I have here are from a pamphlet entitled “The Whisky Problem”; but that pamphlet quotes in turn from the authenticated reports of the British revenue department, and gives the figures for a series of years, running from 1868 to 1875. Mr Eandall. Please incorporate those figures in your statement. Commissioner Eaum. I will do so, and I will endeavor to get the latest data. Mr. Kasson. You have not verified that statement by consulting the original returns. Commissioner Eaum. No ; but I will do so.* I have no doubt as to the correctness of the figures, but I will verify them for the satisfaction of the committee. Soon after the passage of this act of- Parliament, the tax upon distilled spirits was raised to ten shillings upon the imperial gallon at 57. proof, this being equivalent to a tax of $1.78 per gallon proof spirits, United States standard. This high tax stimulated the ingenuity of chemists, and a method was discovered of separating methyl from alcohol, and entirely deodorizing the alcohol so as to restore it. I have no doubt of the ability of manufacturers to entirely remove methyl from alcohol. I will state the reason why I am satisfied this can be done. Alcohol vaporizes at from 175° to 180° Fahr., while wood-naphtha, or methyl, which is much more volatile, vaporizes at 144° Fahr. It is upon this principle of the difference of sjiecific gravity and the difference in the degree of heat necessary to vaporize the various articles that are found in high wines that the distillers are able by the continuous process of distillation to separate alcohol from fusel oil, leaving the oil behind, fusel oil being of greater specific gravity, and vaporizing at a very much higher degree of temper- ature ; so that methylating alcohol as a means of preventing its purification and use in the ordinary lines of trade where tax-paid alcohol would be required, I think would prove a failure. That is my judgment, from the examination I have given the subject. I think this question will have to be examined simply from the stand- point of using the pure alcohol and allowing it to enter into the consumption of the country in the way of manufacturers and arts free of tax. I have before me the English act of 1855. It is a very elaborate act, and makes provision for something very much like our system of distillation, licensing the business of methylating spirits and providing for the establishment of warehouses where this business shall be done. The methylated spirits that are now put upon the market in England, however, are subjected to the same scrutiny and supervision as the ordinary spirits of commerce. [* For verification, see table at page 21.] 928 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. It is important to consider the number of persons who would be authorized to with- draw alcohol free of tax under this bill. We had last year in operation in the United States 1,240 grain distilleries, 7 molasses distilleries, and 3,963 fruit distilleries, so that the total number of distilleries operated and from which methylated spirits might bepnt upon the market under this bill would be 5,272. Those distilleries, of course, are scat- tered all over the United States. The English act provides not only for the withdra wal of methylated spirits from distillery warehouses, but also authorizes the establishment of warehouses for the purpose of methylating spirits. It is very difficult, as was said in a j)amphlet that was read to you the other day, to get at facts where there are no absolute data to be had, and I am very frank to say that I have been groping my way into the facts c f this question as best I could. I endeavored to obtain from the Census Bureau the latest data as to the number of persons supposed to use alcohol in manufactures, but their figures are not in condition to be used. The manufacturers of tobacco are especially spoken of in this bill as a class who would be authorized to use alcohol free of tax. There are 949 of those. Dealers in leaf-tobacco would also be authorized to use alcohol. There are 3,618 of them; and there are 5 retail dealers ; in all, 4,672. From the best information I can obtain I would say that there are 1,321 manufact- urers of perfumery, chemicals, and patent medicmes in this country, and 22,579 drug- gists ; so that there would be 28,572 persons of these classes who would be authorized to withdraw alcohol free of tax, upon a bond, and dispose of it without supervision. Then there are 3,640 photographers; 110,660 painters and varnishers. I do not know how many hat manufacturers there are, but there are 16,412 hatters, who now use about one gallon of alcohol to every hundred silk hats manufactured. Mr. Errett. How many plumbers are there ? Commissioner Raum. I have not the figures as to the number of plumbers. The Chairman. Or the jewelers? Commissioner Raum. No, sir. Mr. Errett. The case of the plumbers would be a good illustration. Commissioner Raum. I am only giving a few of the persons who would be author- ized to use alcohol in this way under the provisions of this bill. This makes an ag- gregate of 159,284 persons who would be authorized to use alcohol in one shape or another under this bill. In the enactment and enforcement of a tax law there are certain elements of human nature that have to be taken into account. We all understand that the general pub- lic and the courts do not attach that degree of moral turpitude to the act of defraud- ing the government out of its taxes that they attach to picking a man’s pocket or robbing a man on the roadside. That is a fact, and it is an element that has to be considered in legislation. But here is a very much more important element, in my j udgment. In respect to acts of this kind, the mere fact of the consciousness of wrong- doing does not deter a man from defrauding the government nearly so much as the fear of detection. A man will carry a burden of fraud in his bosom without very much compunction of conscience if lie has no special apprehension of beffig detected. Now, I know that this bill is very liberal in conferring upon certain officers discre- tionary power to look after and supervise and superintend and inspect, and all that, but I would like to know whether Congress would be willing to pass a law to multi- ply storekeepers and inspectors in sufficient number to examine the 160,000 additional places where these articles would be permitted to be used if this bill should become a law. Our tax is about one-half the English tax ; theirs is $1.78 per gallon, United States standard, while ours is 90 cents ; so that so far as the English manufacturers are concerned, who use tax-paid alcohol, they would be under very much greater dis- abilities than the American manufacturers. The Chairman. On proof spirits or alcohol? Commissioner Raum. Ou proof spirits, the equivalent of our article, which pays 90 cents. So that articles produced in England for export to this country, into which alcohol enters as a constituent, would meet our manufactures at a disadvantage of 88 cents on each gallon of alcohol entering into the manufactured article, which, I think, would be very much to our advantage. It seems to me that if, after a careful examination of the question of the relations which alcohol sustains to our manufactures, it is found that its use has been greatly discouraged by the present tax, to the prejudice of manufacturiug interests, it would be better to reduce the tax ou distilled spirits to a point which would stimulate the use of alcohol in manufactures, and thereby maintain the amount of tax collected from this source, rather than to provide for the withdrawal and use of alcohol in bond without government supervision, or to establish such supervision by the ap- pointment of numerous storekeepers to take charge of the alcohol and to see that it is properly used, which would enable the manufacturers to use the article without su- pervision, and without serious impediment or prejudice to their business. I am inclined to think, from the data that have been presented to me, that the amount of GOLDSBOROUGH ROBINSON.] ALCOHOL. 929 spirits which now enters into manufactures is not as great as I at one time supposed it to he. Mr. Randall. You are not speaking now of tobacco alone ; you are speaking in a comprehensive sense. Commissioner Raum. In a comprehensive sense. There has been a great deal written and said in regard to the amount of spirits per capita that is used in the United States. Mr. Wells, you will remember, dealt with this subject in his report, after a careful ex- amination of the question. He came to the conclusion in 1866 that the probable con- sumption was close upon a gallon and a half per capita. If we are using anything near that quantity now, evidently there is none left for the manufacturers. We have fifty millions of people, and last year the whole quantity withdrawn, tax paid, was only sixty-seven million gallons, so that some of us did not use our proper proportion. [Laughter.] It is, no doubt, known to the committee that prior to 1860 or 1861 the most important industry that consumed alcohol was the manufacture of buring fluid. Mr. Butterworth. You have been calling the attention of the committee, Mr. Commissioner, to the legislation in England upon this subject, and to the English ex- perience. Now, is it not true, notwithstanding the fact that the temptation to fraud in the direction suggested by you is a hundred per cent, greater in England than it would be here under the operation of this bill, if it were a law, that they have not found any occasion in England to modify or change their law? Commissioner Raum. They do not allow pure spirits to go upon the market with- out the payment of tax; only the methylated spirits, and there is only about a mill- ion and a half gallons of that used per annum. Mr. Kasson. Did I understand you rightly, Mr. Commissioner, as saying that the bill introduced by Mr. Willis provided for the use of untaxed spirits by one hundred and fifty-odd thousand — whatever your figures were? I find that the bill introduced by him is limited to the consumption of spirits in the manufacture of tobacco. Mr. Goldsborough Robinson. That is the first bill. Mr. Kasson. Then there is another bill which proposes to extend the privilege ? Mr. Robinson. Yes, sir. Mr. Kasson. I was not aware of that. Mr. Dunnell. The Commissioner is talking about the second bill. Commissioner Raum. Let us see the exact phraseology of this bill: “ Where such spirits shall be withdrawn for use in tobacco factories, or such other industrial pur- suits as shall entail their complete destruction, so that they cannot be recovered by any process of distillation.” I think that language, u other industrial pursuits,” would include everything. Now, as to the amount of spirits that entered into the manufacture of burning fluid before the tax of 1862 was imposed; it was unquestionably very large. There were two reasons which contributed to destroy that industry ; one, the discovery of coal oil, and the other the imposition of the tax upon distilled spirits. In 1867 the amount of coal oil brought to taxation was 25,750,000 gallons. That was for the consumption in this country. Mr. Randall. When was that tax repealed ? Commissioner Raum. In July, 1868. Burning fluid was made of four parts of alco- hol and one part of camphene. If it was used as extensively as coal oil it would have taken, say, about twenty million gallons of alcohol to have produced the necessary amount of burning fluid required for use in 1867. I, of course, see the necessity of cheapening all the materials that enter into our manufactures, especially of articles for foreign exportation, and I take the liberty of speaking to a question that is germane to the subject before you, namely, the manu- facture of tobacco for exportation. It has been the policy of the government to en- courage the manufacture of articles for exportation, and to try to cheapen those prod- ucts, and it seems to me that it would he quite a relief and an encouragement to that indu^ry if Congress should authorize the establishment of export tobacco manufac- tories, and allow those manufacturers to withdraw, without the payment of tax, spirits, sugar, and licorice for use in their business, just as the manufacturing ware- houses, which are established for the manufacture of perfumery, cordials, &c., are allowed to do. Mr. Randall. How would you do that, by a rebate or refund on the goods actually exported ? Commissioner Raum. I do not think it necessary to give any refund. There are not very many of those manufacturing warehouses, and I presume there would not bo very many export tobacco factories established. I would let them withdraw the alcohol free of tax upon the execution of proper bonds. Mr. Randall. But you would watch to see that that alcohol, so withdrawn without paying tax, was all consumed in the manufacture of tobacco for exportation ? Commissioner Raum. Yes; these establishments would not manufacture it for any other purpose. They would be in charge of a storekeeper just like the manufacturing H. Mis. 6 59 930 TARIFF COMMISSION. [GOLDSBOROUGH ROBINSON. warehouses in New York and other places which manufacture perfumery and cordials for exportation. Mr. Errett. Would it he possible to guard the use of whisky, even by tobacconists alone, for home consumption, and not for export? Mr. Kasson. Please answer also the question whether the provisions of this bill would not meet the case which Mr. Errett suggests? Mr. Errett. I am asking whether it would be possible to guard it as well in one case as in the other, and with the same machinery? Commissioner Kaum. Yes; with the same machinery; and it is only a question of machinery. There is no doubt about being able to make arrangements for the great leading industries if you choose to do it, but the question in my mind is whether you are prepared to say that we shall have a great swarm of additional officers stationed all over the United States, and paid out of the Treasury, for looking after this business. Mr. Errett. It would require a storekeeper to each tobacco factory, would it not? Commissioner Raum. I should think so, where they withdrew any considerable quantity. The Chairman. It would not be a step in the direction of civil service reform to so legislate as to require the creation of the additional officers to whom you refer. Commissioner Raum. No ; and I sta.te very frankly that from my standpoint I would not be disposed to recommend legislation that would largely increase the number of internal-reveuue officers throughout the United States. i The Chairman. My question was intended to be whether this bill would not do that to a very great extent. Commissioner Raum. I think it would. Of course where industries are of such great importance as to justify that it ought to be done. In the case of the proposed export tobacco manufacturers I think it would be very wise to do so. We exported last year something like ten million pounds of tobacco. Now, if you could double that by re- ducing the cost of manufacture (and I know that our tobacco manufacturers complain that the Canadian manufacturers are crowding them very much in consequence of the cost of the materials here), that would be a very good thing to do. Mr. Kasson. And for that class of manufacturers the present means of supervision would be substantially sufficient, would it not? Commissioner Raum. Yes; it would require some additional legislation, but you could provide for that. The Chairman. And additional force, would it not? Commissioner Raum. No great additional force. I do not think there would be a dozen export manufacturers altogether. Mr. Butterworth. I wish to call the attention of the Commissioner to this point. Of course in the case of each withdrawal for any purpose the object and purpose of that withdrawal would be stated in the bond and in the jiaper hied for the withdrawal ? Commissioner Raum. Yes. Mr. Butterworth. If, for instance, a plumber should hie an application to with- draw a certain amount of alcohol, the object for which that was withdrawn would be stated, would it not? Commissioner Raum. Yes. Mr. Butterworth. Now, is it not a fact that the amount of alcohol that could be illegitimately used in each one of these callings is dehnitely known, or could be as- certained, and is it not also true that a retail druggist, for instance, if he withdrew alcohol for any legitimate purpose, and afterwards undertook to compound it for use as a beverage, would run the risk of detection, not only so far as regards the amount withdrawn, if that was improper or excessive with reference to the nature and extent of his business, but also the risk of detection by his clerks and other persons about his establishment who would have knowledge of his changing the character of that spirits? Therefore, would not every offender in each case be running the risk for the sake of a few cents of going to the penitentiary and paying a heavy fine? Hav« you not in this, as in other branches of business, the means of determining, with reason- able accuracy, whether the alcohol is really used for the purpose for which it is with- drawn? In other words, you have stated that there are 150,000 persons who would be authorized, if this bill were a law, to withdraw this alcohol for some purpose. Now, the amount that might properly be used by each one of those persons in each of those classes is well known to all others in the same trade or manufacture, and might be well known to the collector of internal revenue; and if there was any diversion of that alcohol to other and illegitimate jmrposes not only would there be the chance of detection in the establishment itself, but also the additional risk of detection by rea- son of iho quantity withdrawn being out of proportion to the purpose for which it purported to have been withdrawn. Commissioner Raum. Suppose we take the case of druggists. They are a very numerous class all over the United States. I presume that the observation and in- formation of members of this committee would coincide with my own to the effect that it is the opinion of a great many well-meaning people that many druggists abuse GOLDSBORO UGH ROBINSON.! ALCOHOL. 931 their privilege, and often sell spirits to be used as a beverage in vio’ation of local laws. Now, suppose you should pass this bill authorizing druggists to withdraw distilled spirits, and a druggist should make the necessary application and tile the required bond, and withdraw, say, five barrels of whisky, and have it transported to his establishment, is there any way, unless you have a storekeeper, and a store-room secured by a government lock, by which you can tell how the druggist will dispose of that five barrels of spirits? I think not, and if a saloon-keeper in the same block, with a back yard communicating with that of the druggists, should be in collusion with the druggist, I think they could use those spirits illegitimately without diffi- culty. You must remember that the temptation would be great for the commission of such fraud; the tax is, say, $36 per barrel. Mr. Hubbell. I think you would find a good many of the druggists and saloon- keepers running their concerns on joint accounts. Commissioner Raum. That is my impression. Human nature is very much the same now, I presume, that it was in 1868. Before the passage of the act of .July 20, 1868, which introduced the system of paying taxes upon spirits by stamps, the tax was two dollars per gallon, and the government received taxes upon 14,132,322 gal- lons. The very next year after the introduction of the system of paying the tax by stamps placed upon the heads of the barrels, the government received taxes upon 53,103,507 gallons. It does not stand to reason that 41,000,000 gallons of spirits more were used in 1869 than in 1868. I thinly the difference is accounted for by the fact that the government not having had proper supervision over the manufacture and sale of spirits in 1868, and having imposed a large tax upon the article, the tempta- tion to defraud was so great that the manufacturers did not bring all the spirits pro- duced to taxation. An opportunity to save the tax of 90 cents a gallon would be a great temptation, and it strikes me that if you should pass this bill you would multi- ply places and opportunities for the perpetration of fraud. I have no question that a very large number of well-meaning men all over the country would withdraw spir- its and conscientiously account for them, but I think that very many others would make this law an occasion for defrauding the government, and in a little while would make it so odious that Congress would be called upon to repeal it. I intend, if the committee think well of it, to address letters to all the collectors of internal revenue in the United States, directing them to make inquiry of the various manufacturers who would probably use alcohol, and to endeavor to ascertain what quantity they now use, what quantities they would use if the tax were reduced to 50 cents, and what quantities they would use if the tax were taken off altogether. I believe I can have that information in the course of twenty days, and, while I would not suggest any postponement on that account, if the committee think well of the suggestion, I will try to get the information. I do not know how the committee may feel, but I feel that I am groping in the dark on this subject. Mr. Dunnell. Do the same objections hold against the first bill introduced by Mr. Willis that hold against the second ? Commissioner Raum. Do you mean in reference to tobacco manufacturers? Mr. Dunnell. Yes. Commissioner Raum. I think the more limited a bill of this kind is the less objec- tionable it is. I spoke to that question one evening here, simply upon principle, if the privilege were confined solely to manufacturers of tobacco and not to dealers it would bring it within certain manageable limits. If you provided at once for a storekeeper it would bring it within such limits that it could be handled without any difficulty at all. If this bill were arranged so that all establishments that desired to withdraw alcohol to the extent of, say, a thousand gallons, or so as to warrant the employment of a storekeeper, where the establishments were of sufficient importance to warrant it, I would say that there would be no difficulty in arranging the machin- ery to carry this bill into operation without danger of fraud. Mr. Dunnell. Do the words “this bill,” which you have just used, apply to the bill in relation to tobacco manufacturers? Commissioner Raum. They apply to either. The Chairman. Might it not be regarded as invidious to grant that privilege to one single industry? Might it not be looked upon as somewhat in the nature of special legislation ? Commissioner Raum. That is the point I made here about a month ago, that others would seem to have an equal right with the tobacco manufacturers in this matter, and that those who were manufacturing articles of prime necessity would seem per- haps to stand upon even higher ground, tobacco being regarded as one of the luxuries of life. The Chairman. And one of the bete noirs of America — a thing that ought to be taxed out of existence and use. Commissioner Raum. Now I am frank to say, upon a line of thought which yon, Mr. Chairman, suggested before the committee was called to order, that if you can legislate so as to increase the manufacture of alcohol, it will be in the interest of the 932 TARIFF COMMISSION. COOLDSBOROUGH ROBINSON. agriculturist, because if you can increase the use of alcohol, in the arts and manufact- ures, say 20,000,000 gallons, that means a market for 5,000,000 bushels of grain, aud I will be very glad if a line of legislation could be entered upon that would result in that way. But it seems to me that you should take hold of it in a proper way at the start, aud not allow this alcohol to be scattered all over the United States in the hands of a great many people without any supervision. You should confine it to places where there are storekeepers, and in that way the law could be carried into effect without any difficulty at all. The Chairman. The conversation to which the Commissioner has just referred was one in which I called his attention to statistics in his own report showing the fact that we collected tax on no more gallons of alcohol or on scarcely any more in 1881 than in 1870, the high tax having driven people to the use of non-agricultural substi- tutes for the natural and most potent solvent, that produced from our grain; and sug- gested that this was operating therefore as a detriment to the grain growers of the country. Mr. Errett. What do you say, Mr. Chairman, as to the suggestion of the Com- missioner in regard to sending out for statistics? The Chairman. I should like to have it done. The Chairman put the question whether the Commissioner should be requested to procure the statistics, as suggested by him, and it was unanimously agreed to. Mr. Goldsborough Robinson. I desire to call attention to one matter of authority. The Commissioner’s first statement, upon which he settled this whole methyl spirit question, was based on the idea that this methyl could be recovered by distillation. In the United States Dispensatory (p. 1700) I find the following: “The British Parliament, wishing to encourage the use of alcohol in the arts, but not as a beverage, passed an act, in 1855, allowing it to be used duty free, provided it be mixed with at least one-ninth of its bulk of pyroxylic spirit, which renders it unfit for drinking, but does not spoil it for use in the arts. This mixture is called methylated spirits, and is now employed extensively in Great Britain by hatters, brass-founders, and cabinet-makers for dissolving shellac and other resinous substances, and by manu- facturing chemists for making ether, chloroform, and sweet spirits of niter. From the purification of pyroxylic spirit already referred to, so as to deprive it of offensive taste, it has been supposed that the intended operation of the British revenue laws might be evaded ; but in opposition to this idea it is asserted that the purifying process is too expensive, on the large scale, to render it available for the purpose.” The process here referred to is very troublesome, and, as previously given in the Dispensatory, involves the use of lime, chloride of calcium, &c., and not by any pro- cess of distillation. That law has been in operation in England, as Mr. Butterworth stated, for twenty- five or thirty years, and the British people have seen no reason to repeal it. It has been of very great benefit to their arts and manufactures. It is impossible by any process of distillation — contrary to what the Commissioner seems to believe — to sepa- rate these spirits. They are both alcohols, and the distillation that passes over one will pass over the other. You can no more separate them by distillation than you can separate a gallon of Chicago alcohol from a gallon of Cincinnati alcohol after they have been once mixed together. Now, this whole methyl question has been disposed of by the Commissioner upon the assumption that they might be separated, but the fact is that they have not been and cannot be practically separated. Still further, I do not think any supposition that the American people are less law- abiding, less easily controlled, or less willing to obey laws passed by their own legis- lature than the English people will pass current here. So that this methyl question cannot be disposed of upon the ground of the probability of fraud. The Commissioner further says that some 28,000 people may avail themselves of this law. I say more than that ; I say that some 40,000,000 of people may avail themselves of this law, be- cause it provides that any firm, individual, or corporation can come forward and ask for this alcohol free of tax. But does this committee suppose for a moment that 40,000,000 of American people are coming forward to ask for an opportunity to defraud the revenue? No! Each man must state in his application, subject to the approval of the Commissioner or the collector, the exact uses to which he desires to put the alcohol, and the Commissioner can impose such stringent regulations that no person can use it for fraudulent purposes without ultimate detection. Some six or eight tenths of the whole use under this law would be methylated spir- its, and no argument can hold against that use, which has been tried successfully in England for thirty years. The use of pure alcohol would be limited to a few lines of manufacturing establishments, with large investments and large plant, and do you suppose any of the large manufacturers will take the chance of going to the peniten- tiary by attempting to violate this law ? The whole matter is placed right in the grasp of our own officers by the provisions of the law. It is no excuse to give the people for its non-passage that a law proposed for their benefit opens the gate to fraud. All revenue laws open the gate to fraud. The tariff law opens a gate to fraud by GOLDSBO ROUGH ROBINSON.] ALCOHOL. 933 offering an inducement to smuggle. Now, the government has been able to collect from the people immense sums of money by the use of four simple provisions, as pre- viously stated, and I ask you, gentlemen, as one of the people, whether some benefit may not now be given to the people, to their arts and manufactures, by the use of the same means. The Commissioner has well stated how great the advantage resulting from the passage of this law would be to our manufactures and agriculture, and I ap- peal to you to give us the benefit of this proposed legislation. Commissioner Raum. In reply to Mr. Robinson’s remarks, I would like to call the committee’s attention to “Reports of U. S. Revenue Commissioner, 1865-’C.” I read from page 186, as follows : ‘ 1 In order to ascertain whether a similar provision of law would be desirable in the United States, the commission have caused a quantity of methylated spirits to be pre- pared, and have also procured samples of the mixture from Great Britain, and have submitted the same for trial to the representatives of various industrial pursuits in which alcohol is extensively used. The judgment of these persons, as rendered to the commission, has been unfavorable to the use of ‘ methylated spirits,’ and induces a be- lief that even if the government were to authorize its preparation and sale, duty free, its application and use in the United States would not be very extensive. The com- mission are confirmed in this view, moreover, by the returns of the board of commis- sioners of inland revenue of Great Britain, which show that the maximum amount of methylated spirits ever used in that country in any one year has never equaled one million of gallons. “ Thereis, however, a more serious objection to the introduction and use of methylated spirits in the United States than that above presented; which is, that within a very recent period the advance in the science of chemistry has been such as to allow of the complete purification and deodorization of spirits impregnated with wood-naphtha ; so that the British authorities have been obliged during the last year to subject the manufacture and subsequent use of methylic alcohol to the same restrictions as are im- posed upon the manufacture of distilled spirits.” Iu verification of the figures submitted by Commissioner Raum, the following table is submitted bv the Commissioner: Statement of the quantities of spirits methylated in the United Kingdom of Great Britain and Ireland during each of the fiscal years ended March 31, from 1857 to 1881. 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 1874 1875 1876 1877 1878 1879 1880 1881 Number of gallons of spirits methylated. 209, 252, 336, 460, 538, 632, 748, 863, 933, 998, 928, 854, 885, 977, 1 , 002 , 1, 086, 1,071, 1, 099, 1, 180, 1, 262, 1, 3"3, 1, 344, 1,428, 1, 601, 1, 762, 75, 628 48 759 209, 693 252, 520 336, 409 460, 067 538, 969 632, 227 748, 163 863, 747 933, 647 998, 372 928, 672 854, 842 885, 958 977, 469 1, 002, 298 1, 086, 671 1, 071, 949 1, 099, 699 1, 180, 055 1, 262, 734 1, 373, 366 1, 424, 040 1,477, 371 1,601,877 1, 762, 659 Reference to reports from which these figures are taken. From table on page 11 of the report of the commissioners of ^inland revenue, on the duties under their management, for the years 1856 to 1869, inclusive. Volume II. London, 1870. J From 14th report (p. 10) of the commissioners of inland revenue. > From 15th report (p. 10) of the commissioners of inland rev- ) enue. From 17th report (p. 8) of the commissioners of inland revenue. ? From 18th report (p. 8) of the commissioners of inland rev- 5 enue. From 1 9th report (p. 14) of the commissioners of inland revenue. From 20threport (p. 10) ofthe commissioners of inland revenue. ) From 22d report (p. 9) of the commissioners of inland reve- ) nue. ) From 24th report (p. 7) of the commissioners of inland reve- 5 nue. [GOLDSBOEOUGH ROBINSON. 934 TARIFF COMMISSION. The Chairman submitted the following letter, to be made a part of these minutes: “New York, March 17, 1882. ‘ ‘ House Committee on Ways and Means : “ Gentlemen : We use from fifteen to twenty barrels alcohol per month. We ought to use fifty barrels with tax reduced. We are obliged to export alcohol to Saint Thomas and make crude material and import same back. By so doing we are able to hold a portion of trade; but if we were to pay present price of alcohol in States we could not do business, even with 40 per cent duty on blasting caps, which is in force. Germany sends most all that is used here. “Yours, respectfully, “Metallic Cap Company. “H. S. CHAPMAN.’ 7 Adjourned. Hon. Wm. D. Kelley and members of the Committee on Ways and Means: Gentlemen: The honorable Commissioner of Internal Revenue based his argu- ment against the Willis bill, made before you on April 4, on the ground of his fear of the fraudulent use of spirits withdrawn free of tax under that bill and his opposition to the appointment of the immense number of additional revenue officers which might be required. He gave his reasons for this fear of fraud : In the statement that a great number of people might withdraw alcohol under this bill. In his belief that methylated spirits might be subjected to a process of distillation which would free it from methyl and Teuder it fit for use as a beverage. In his belief with the old Prophet Jeremiah that human nature generally was deceitful above all things and desperately wicked and that this bill would ofier a temptation and open a gate to fraud not already offered and not already opened. He illustrated his fears in a supposed case of how a retail druggist might apply for five barrels of Kentucky whisky and sell it for drinks or pass it through his back yard to a saloon keeper for sale for that purpose. Now what are the facts in the case and what are reasonable deductions from the same? This bill provides : 1 . For the use free of tax in industrial pursuits of spirits mixed with methyl ac- cording to the English standard. 2. For the use of pure spirits in those manufacturing processes only which shall destroy them so that they cannot be recovered, and this use is to be guarded by the giving of bonds, keeping of books, and government supervision. This bill provides still further that the sale, use, or willful permission of use of spirits withdrawn under it for any other purpose than industrial pursuits shall be punished with the usual severe penalties of the revenue laws. The Hon. Ben. Butterworth, as a revenue lawyer of experience, bore testimony be- fore you that this law opened no gate to fraud not already wide open. The revenue laws already in existence offer the temptation to fraud, by taxing proof spirits $36 per barrel, and I propose to prove clearly that these laws offer much easier methods for fraud, and that without acceptance by the people, than any which can be offered under the operations of the Willis bill, and when this proof is made, I respect- fully submit the proposition, that this cry of probable fraud, so easily raised, should and ought to be forever dismissed from the consideration of this subject. Now for the proof. Let us test the question with the retail druggists and chemists. They number, according to the honorable Commissioner’s estimate, about twenty- eight thousand in the United States, and have been selected by him as a class which would be peculiarly tempted and have especial advantages for fraud under this bill. The production of spirits by the fermentation and distillation of saccharine matter is one of the simplest processes known to chemistry, and is familiar to every druggist — nearly every druggist has a still. On their shelves are cans and jars filled with spirits upon which there are no stamps or brand to prove any payment of tax, or iden- tify the place of production. They can easily produce, with these stills, by a simple process, proof spirits, at a cost of 18 to 30 cents per gallon ; they are now paying $1.15 for them. This process can be carried on in a back or attic room, apparently almost without risk of detection, and yet there is no record of any appreciable fraud by this class of men. (For detail proof, see note A.) The people are either more honest or stand in greater fear of the penalty than the Commissioner believes. Under the Willis bill these druggists would either have to attempt the practically im- possible illicit distillation of methylated spirits (see note B), or else, to obtain pure spirits, would have to file a bond for double the tax on the spirits withdraw^ make application stating a manufacturing process which would destroy, and then furnish ALCOHOL. GOLDSBOROUGH ROBINSON.] 935 proof showing such destruction and the reasonable ground thereof; they would also he required to keep proper hooks of detail. Do thieves notify officers of their intention to steal ? This law presupposes ordinary common sense on the part of revenue officers, and could a retail druggist state in his application any reasonable manufacturing pro- cess necessary to his business which would destroy five barrels of Kentucky whisky, or could he furnish proof of such destruction? I might multiply examples, but this class of men, so numerous, and selected by the Commissioner himself, furnishes abundant proof of the statement that fraud is more easy under the present laws than it could possibly be under any provision of the Willis bill. Our revenue laws are enforced by the honesty of the great mass of our people, and because the evil-disposed are held in check by the fear of the penalty and the certainty of ultimate detection through the betrayal of friends, servants, or clerks, or through the jealousy of trade. The second ground of the Commissioner’s objection, the employment of additional officers, is, I think, thrown in as a suggestion, without his having given the subject much consideration. What are the facts ? The methylated spirits are to be mixed under the supervision of government officers, in bonded distillery warehouses. These officers are already there, and their duties are to watch and not to work. The pure spirits are to be withdrawn by application and bond through the collector, and their use will be subject to examination by himself or his deputy. These officers already exist. Supervision over the sale of spirits throughout the United States is already exer- cised by officers already appointed. In conclusion, it will be more apparent the more this subject is considered, that this bill gives greater security to the revenue than the laws which are now enforced; that it involves no bad public policy, but, on the con- trary, is a measure due to the people, and one which, if enacted, will meet with al- most universal approbation. I cannot close, Mr. Chairman, without offering to yourself and to the members of the committee my most earnest thanks for the kind consideration which you and they have shown me; a consideration which is, I know, due to the desire to thoroughly investigate the needs and interests of the people, and yet which has been very grati- fying and helpful to me, who appeared before you without experience and sustained only by that strength which comes from a sincere belief in the justice and right of the cause advocated. GOLDSBOROUGH ROBINSON. Note A. The following letter from a practical chemist and druggist of high standing shows that druggists already have stills, and that they can easily produce spirits at a cost of 18 cents per gallon if they -were willing to violate the law, but cannot practically, by any process, render methylated spirits fit for use as a beverage : Louisville, Ky., April 10, 1882. Mr. Goldsborough Robinson: Dear Sir: In answer to your inquiries, I would say that almost all the retail drug- gists and apothecaries have small stills, which they use for recovering alcohol from the percolate obtained in making fluid extracts, preparing distilled water, &c. In regard to the costs of manufacturing spirits in a small way: For the past two years I have been employed as chemist for the Newcomb-Buchannan Company, and have been constantly making experiments, and have been rarely able to obtain as good results in a large way, in the distillery, as I have in my experi- mental laboratory, in a small way, where I have never produced below 3.85 gallons, and from selected grain 5.11 gallons to the bushel of 56 xiounds of grain. Any apothecary could, in his laboratory, produce on an average four gallons of proof spirits from the same amount of grain, counting the extra cost of £uel, labor, and the average cost of grain. He could probably produce spirits at a profit at 18 cents per gallon. If manufactured from sugar, the cost would be greater, probably from 30 to 32 cents, but the labor less and no slops to be gotten rid of. In regard to methylated spirits, I should regard the separation of 10 per cent, of wood alcohol from grain alcohol, so that it could be used as a beverage, as practically impossible, and entirely so, except at several times the value of the alcohol obtained, and, even then, there would remain an exceedingly unpleasant odor in the grain alcohol from the acetate of methyl, which is always contained in larger proportions in commercial wood alcohol, from which it can be freed only by uniting with chloride 936 TARIFF COMMISSION. GOLDSBOROUGH ROBINSON. of calcium, driving off the acetate by heat, dissolving in water, and distilling. This acetate unites readily with grain spirits, and does not vaporize when so united, at a temperature lower than the boiling point of alcohol. Very truly, yours, J. P. BARNUM, Analytical Chemist. Mayor’s Office, Louisville, April 11, 1882. This is to certify that J. P. Barnum is a chemist in this city, of good standing, and ©f more than ordinary capacity. CHARLES D. JACOB, Mayor. Note B ; The following extract from the latest British revenue returns is furnished by Mr. Hill, statistician of the State Department, and the note shows the satisfaction which this legislation gives after a trial of nearly thirty years : QUANTITIES METHYLATED (BRITISH SPIRITS). Years. England. Scotland. Ireland. United Kingdom. 1880 Gallons. 1, 113, 529 1, 225, 439 Gallons. 472,868 517,182 Gallons. 15, 48a 20, 038 Gallons. 1, 601, 877 1, 762, 659 1881 Increase 111, 910 44,814 4, 558 160, 780 Note. — This return is reported satisfactory. Each year shows a steady increase from extended and developed use of methylated spirit in art and manufactory and for domestic use. N. T. DE PAUW.] PLATE GLASS. 937 N. T. DE PAUW. Louisville, Ky., September 6, 1882. N. T. De Pauw, plate-glass manufacturer, of New Albany, Ind., ap- peared before the Commission and made the following statement : My father, W. C. De Pauw, is the proprietor of our plate, window, and fruit-jar glass works, and I am his manager. He expects to present a written statement to the Commission, but it has not yet been prepared. While in New York I received a telegram from the secretary of the Com- mission stating that he would like an interview with me. I have not had time to prepare any formal statement, as I only arrived in the city one hour ago, and have not even had time to go to my office, but shall be glad to answer any questions in relation to the business that the mem- bers of the Commission may see fit to ask. The product of our business this year will be over $1,000,000. There was something over $1,300,000 invested up to 1879. January 1, 1879, there was an invoice taken, and we learned that our losses up to that time had been nearly $600,000. Since then, however, we have lost money only one year. The business has been gradually growing, and it is now paying a small profit. The profits were and are mostly made on window glass and fruit jars, but little on plate, and on all have never reached 8 per cent, in any year. The capital my father has now invested in the works is, say, $1,250,000. It is a business that requires a great deal of capital, and it is difficult to put it in a paying shape, though we have been gradually approaching that point, and we think it no longer a problem. By Commissioner Porter : Question. Since you started the manufacture of plate glass has the price of that article increased or decreased ? — Answer. The price of some sizes is only one- third of what it was when we started, and that of others only one-half. In no case is the price over one-half. Q. How many hands do you employ? — A. In the neighborhood of 1 , 000 . Q. You manufacture practically all the plate glass manufactured in this country ? — A. No, sir. I presume we manufacture about two-thirds of all the plate glass in the United States. With reference to the tariff upon plate glass, I can say that while we have been manufacturing it for the last ten or eleven years, the importations during that time have been increasing also, the reason of which is that the glass has become so cheap (in comparison with what it was formally) in consequence of the manu- facture of it in this country. By Commissioner Boteler : Q. Are you satisfied with the present rate of duty ? — A. We are sat- isfied with the duty upon the large sizes, which is four-fifths or 80 per cent, of our product, but not upon the small, say, one-fifth. I think my father’s idea is to ask an advance of the rate of duty on small glass. By Commissioner Porter : Q. Have you any schedule showing the prices paid for labor ? — A. I have one comparing the prices of labor here with the prices for labor in .938 TARIFF COMMISSION. [N. T. DE PAUW. England. The comparison I made from the consular reports published in 1879, but, as I said before, I have not had time to go to my office, and haven’t it with me. My father, in his travels abroad, has procured mem- oranda of the wages paid in France, Belgium, and Germany, and he proposes to lay that whole schedule before you. Q. The prices have been procured directly from the manufacturers? — A. Yes ; at least he has it in definite and authentic shape. From what the men tell me who are in our employ the wages paid in England, as per the consular reports above referred to, are given there from 33 to 50 per cent, more than are really paid. We pay from two to four times as much as is paid in Europe for the same class of labor. Our industry is just in this shape: Being a new industry, we have been obliged to import men who have understood the business in order to build it up in this country. If a reduction should be made in the tariff, the only chance for us would be in reducing our labor, every thing else being on the lowest possible basis. We are getting our materials as cheaply now as possible. Q. Would the labor stand any reduction? — A. We think not. You can see the difference between this and any regularly established indus- try old enough to have taught Americans the art or skill. Q. About how old is your industry? — A. Between eleven and twelve years. Ten years ago there was practically no plate glass manufactured in this country. It had been attempted at several points, but it had always resulted in failure. By the President : Q. What are the raw materials of which plate glass is made? — A. Sand, soda-ash, and lime. Q. Have you any peculiar advantages in your situation with reference to sand? — A. Yes, sir; we have, we think, very peculiar advantages; we have two sand banks within 10 to 19 miles of our works, and the sand is of peculiar excellence for our purposes. We can get it to our works cheaply ; and we get our lime more cheaply, I presume, than any other manufactory in the country. Q. Is it absolutely pure? — A. Yot absolutely pure theoretically', but practically it is, containing over 99 per cent, silica. Q. What is your grinding material? — A. In the first place it is sharp sand from the river, and then we finish with powdered emery stone. We can get the sand from the river as cheaply as it can be procured anywhere in the world, for we have a steamboat with patent machinery that digs it, washes it, and screens it all, and then brings it to our dock. Our emery stone we have to import, as all plate-glass manufacturers have to do, from Turkey and Smyrna. Q. How does tbe duty on emery affect you? — A. The amount of em- ery stone we use is so small that it is merely nominal. Q. And how with reference to soda-ash? — A. That is where the duty affects us very strongly. We use about $100,000 worth of soda ash annually, and the duty 1 think is about 20 per cent. We have attempted the manufacture of it ourselves, and it has also been tried by others once or twice, but never with any financial success in this country. The reason is the high cost of sulphur in this country. We have to get it from the same sources as the English and French, and, of course, they get it much more cheaply than we do, they being much nearer the sul- phur mines. By Commissioner Porter : Q. In brief, what do you consider the advantages of your location ? — N T. DE PAUW.] PLATE GLASS. 939 A. I consider that there is no better location to be found in the United States. Q. Explain why. — A. In the first place. New Albany is a healthy and desirable place to live; farm and garden products are abundant and cheap. We get our mixed sand as cheaply as it can be procured any- where else, and lime and grindings and much more cheaply; we can get our soda-ash as cheaply as it can be procured at any point in the West. By the President : Q. How are the advantages in regard to transportation ? — A. Very good. The location is most excellent; in fact my father took nearly three or four years to investigate different localities, and visited quite a number of places for that purpose, intending, if he could find a better place, to move the glass-works there, but he was unable to find any that he thought so good. By Commissioner McMahon : Q. You think the present rates on the smaller sizes are not adequate to protect the manufacturer, as I understand; can you suggest any sim- plification of the present rates of duty *? — A. I presume I could by a little study. Q. There are some twenty-odd different rates of duty on window and plate glass. — A. I think the duty could be very much simplified, but any suggestion of that kind I should prefer to give in writing. Q. Are the prices of foreign plate glass easily determined t — A. If your question refers to the selling price in this country, yes. Q. Is there a probability of undervaluation as compared with other merchandise ? — A. In plate glass there is very little probability of that, because the duty is specific. Q. I am assuming that it is an ad valorem duty. — A. You take plate glass as large as that table and cut it into three or four pieces, and they put them together without a fraction of an inch loss, and yet it would not be worth within 25 per cent, as much as the whole piece was. It would be very easy for an importer to put a large plate glass in a box and say that it was small plate glass, and value it as so many lights of small glass. He could have the same weight and the same number of square feet of glass, and yet there would be a diminution of twenty -five to fifty per cent, in the price of glass. Q. Suppose it to be examined, then what % — A. You could not ex- amine every package ; it wmuld cost too much, and the risk of breakage by handling is too great. Q. Is it not examined now % — A. No, sir ; not on the dock. Q. What I want to get at is this : Is the price so fixed that an expert can determine within a very small percentage the foreign market value of plate glass % — A. Really, so far as the foreign market value is con- cerned I can hardly answer the question. I am not familiar enough with it. I presume father can answer it, and probably will. I will make a note of that, and when he submits his written statement he will refer to it. By Commissioner Oliver : Q. Are not the largest dealers in plate glass in New York the agents of branch houses of English or French manufacturers ? — A. Yes, sir ; the two largest are. The most of the plate glass sold in New York is manufactured by the London and Manchester Company, and is sold through its agent, J. A. Waller. Q. Then, if a change is made in duty from specific to ad valorem, the 940 [N. t. de pauw. TARIFF COMMISSION. English manufacturer would be making the bills to his branch houses in iNew York ? — A. He would be making bills to his own agent. So it is with the French. I presume four-fifths of the plate glass imported into New York comes to French and English agents. Q. Your competitors, then, are nearly all the agents of French and English houses % — A. You may say that this is practically the case, it is so near it. Q. It is stated that on account of the cost of transportation and breakage you have a large incidental protection. — A. That does not amount to anything. I do not believe the breakage in our business in shipping from here to San Francisco would amount to one-half of one per cent, a year. We do not have one glass out of a thousand broken in transit after it is packed. Q. Can you state about what proportion of your product is raw ma- terial and what is labor*? — A. No, sir, I cannot; but if you have a copy of the advance sheets of the census report, that will show it; that was prepared by Hon. Joseph D. Weeks from data prepared by my father and myself very carefully. Q. What would be the effect on your business of a reduction of the duty, say of 25 per cent. ? — A. It would stop us. Q. You speak of being well situated as to facilities for getting raw material for the manufacture of plate glass. About what would be the average price for coal *? Fuel, as I understand, is a large item of cost in the manufacture of glass. — A. Yes, sir; in our business we have always up to this year used Pittsburgh coal. We have to pay about the price that is paid by large consumers of Pittsburgh coal, with an addition of about one and a half cents per bushel. There is a new railroad completed from the coal mines of Indiana to New Albany that will work quite a revolution in this matter, we think, and enable us to have our coal as cheaply as any place in or about Pittsburgh. Of course it is hardly as good as the Pittsburgh coal, but it will answer our pur- poses. Q. Has this plate glass you make been used in this country for large mirrors? — A. Yes; we made a specialty of mirrors one year, the -year after we lost so much money, thinking probably there was a chance to recover some of it in that branch of business. That year our mirror glass was almost as good as the French, and no one but an expert could tell the difference between ours and the French article. In the restau- rant of the Palmer House in Chicago every mirror is made of our glass except one. Originally they were all made of ours, but one was broken and replaced by foreign glass. The glass is divided into two grades in Europe. First, they make a finished article of plate glass without prac- tically any defects, which is for silvering ; the second grade, for glazing, is for windows. Mirror plate is worth considerably more money than the other kind, and requires costlier material to produce it. By Commissioner Boteler : Q. You say a reduction of the duty would stop your plate-glass works. There are very few such manufactories in the country, as I understand. — A. There is one at Jeffersonville, Ind., one at Crystal City, near Saint Louis, and another one being erected near Pittsburgh, and our two works, making five altogether. Q. What would be the consequence to the consumers of a reduction of duty ? — A. I presume for a year or two, probably, plate glass would be cheaper, and then it would probably go back to the old figures, for this reason : The foreign manufacturers would put it down to drive us all N. T. DE TAUW.] PLATE GLASS. 941 out of the business. Every one who is engaged in manufacturing rec- ognizes the fact that nothing depreciates so rapidly as manufacturing machinery when not in use. Three years would put our factories in such shape that it would cost nearly half their value to put them in order again. Of course if they did not put up the price we would have no assurance in the world but what they would drop prices on us again, hence no one would risk capital to put in order and start up the aban- doned works, and the foreigners would again have the monopoly they enjoyed for so long. Q. You spoke of foreign competition ; can you give us any idea of the number and extent of plate-glass manufactories in Europe? — A. I have those figures all at our office. To the best of my recollection the product in Europe (England and France both) is about 500,000 feet per week, which would make 26,000,000 feet of plate glass per year. No man can make a success of it in Europe or America unless he goes into it on a large scale. I do not think there are more than three or four factories in operation in all England. I do not know how many factor- ies there are in France. They are all under one head and belong prac- tically to one company. In Belgium they are probably the same. I do not think, the world over, there are over twenty factories of plate glass. Q. The number is not so great but that they could easily control the market by a combination ? — A. The fact is that all grades of French plate glass are controlled by a syndicate to-day, represented in New York by Mr. Miguel Aleo. Q. So that supposing three or four plate-glass manufactories in this country could control it, we should not be very much better off? — A. They could not put it above a certain figure. Plate glass cannot go any higher than it is to-day, and I think it never will be any higher if the tariff is left as it is to-day as long as American factories exist. 942 TARIFF COMMISSION. [ROBERT H. COWDERY. ROBERT II. COWDERY. Chicago, III., September 7, 1882. Robert H. Cowdery, druggist, representing the Druggists 7 Associ- ation of Chicago, appeared before the Commission and made the fol- lowing statement : To the manufacturer the question u Shall quinine be retaxed ? 77 is one easily answered, for the reason that it will be a benefit to him financi- ally. His answer is, therefore, affirmative; and for so answering no reasonable person can condemn him. With him it is a matter of busi- ness, and, harm who it may, he will have it reimposed if possible. By the public and the retail dealer this question is, however, an- swered in the negative. Their reasons are the same as the manufact- urers — selfish. We have, therefore, two distinct divisions : The affirma- tive, who are active, belligerent, and determined. The negative, quiescent and passive. In deciding the probability of success between two such divisions, the wiser man would naturally choose the active and determined side, though less in number than his more numerous but passive oppo- nent. The manufacturer may be expected to use as much energy as would the retail merchant, if he saw a chance by which, through an act of Con- gress, his competitors could be stopped from competing with him because of an extra profit (income tax) being guaranteed to him. The best argument presented by the manufacturer is that a tax is now' imposed on the bark, without which he cannot produce quinine. I believe, if I am right about that, that the tax on bark has been repealed, to take effect next January. To an ordinary person it would seem to be the better plan to first try to have this tax removed, and after an effort in that direction had failed then the argument would have greater force. That a resolution for the abolition of the tax on bark could have. been passed at the meeting of the Western Wholesale Drug Association was the case; and, further, that it was opposed by a representative of the manufacturers. By this I am led to believe that the abolition of the tax upon barks is not desired by the manufacturer in this country. Eor, with no tax on bark or quinine, the plan of freezing out the importer would not work as satisfactorily to the American producer as it does when quinine is taxed. I will say that, as far as I am informed, the tax upon bark has been the chief reason asserted by the manufacturer why quinine should be taxed ; that, together with the fact that the consumer has not been bene- fited by the reduction in the tax on quinine. The possibility of having the tax on alcohol used for manufacturing abolished, and admitting that it cannot be, I still fail to see where the great hardship is ; for alcohol used in the manufacture of quinine is not destroyed, but can be, and undoubtedly is, recovered by distillation and used over and over. Furthermore, alcohol is not used to any extent in the manufacture of quinine, fusel oil taking its place almost entirely. We are told that if the tax on quinine is removed, so should it be on pig-iron, cotton, silks, or anything else. This is, to some extent, true; but, as this involves the v 7 hole subject of protection and free trade, I must be pardoned for not entertaining it here, as I have to deal with one subject now, and that is quinine. ROBERT 1L COWDERY.] QUININE. 943 Another argument advanced is, that the consumer has not been bene- fited. Each retail dealer is the best judge of that, lor when quinine was under a protective tariff, 2 cents a grain was the ordinary price, and now, without tariff, the consumer obtains it at 1J cents a grain. It is to the retail dealer, who distributes to the consumer, that the greatest injustice will be done. His prices have been made in accord- ance with the lowest price of quinine, and, though quinine has advanced, he gets no more from the consumer than before. I mean by that, that in March, this year, quinine was at the lowest price I have ever seen it in the trade. It was then worth about $1.80 to $1.90, and our prices were made in accordance with those prices. It has since advanced about 60 cents, and the retailer gets no more for it now than before, when the wholesale price was $1.90. Small as it may seem to the manufacturer, it is a burden that is not borne contentedly, and he feels that each rise of fifty cents is so much taken from his legitimate profits by the manufacturer. To be sure, the remedy is in their hands, to some extent — to raise the retail price; but had the manufacturer ever stood behind the counter, lie would know full well the endless trouble that a rise in price of quinine produces upon the unfortunate retail dealer; so much so that be prefers to pocket his loss and keep the old price. All the other arguments that I have seen advanced on the side of the manufacturer have savored of demanded sympathy for the manufact- urer. When sympathy is demanded for the manufacturer against the best interest of the general public, such demands should go unanswered. 31uch has been written in the attempt to prove to the public that a reimposition of the tax would not raise the price of quinine. Seemingly in forgetfulness of this position they use such arguments as the failure of Messrs. Ohas. T. White & Co. as reasons why quinine should be taxed. Why it should save them, unless they can sell their quinine at a higher price, I cannot see. That it is their intent to make money for themselves no one has a doubt; and, if so, it must be at the expense of die pharmacists of this country, as well as the general public. The retail trade have but just recovered from the tumble in price from nearly four dollars to the present price of $1.90 to $2. Their prices have just been graded to this last price, when they are con- fronted with the impending ten per cent, ad valorem. It is even as- serted that the removal of the duty has not materially lessened the price of quinine. To be sure, quinine advanced immediately after the removal of the duty, and the retail trade was flooded with plausibly-worded circulars, proving conclusively that a mistake had been made in abolishing the duty, and advocating an immediate return to the old regime . But the foreign manufacturer has had time to manufacture and send across the water his production, and note the change: Quinine is worth to-day only half what it could be bought for then. Now we hear on every hand that this decline is due to an entirely different cause, a new source of supply has been discovered, and there is no telling where prices will go to; but as this new scheme develops, and the wires are laid for a reimposition of duty, reports are circulated that this new source is failing and will not last long — in fact, it is “a pocket” which, when exhausted, will be of no further use. Now, my reasons for believing that my position is correct is that these stories do not hang together. Again, I do not believe in a won- 944 TARIFF COMMISSION. [ROBERT H. COWDERY. clerful new source one minute, and in a “pocket” the next — in fact, I have no faitli in the “ pocket” theory at all. I would prefer to take the chances of an open market ; and it be- hooves us to look to it that quinine is not again the means of putting millions of money into the pockets of one firm at the expense of the pub- lic, and to our detriment. It is a notorious fact that during the period that quinine was pro- tected by a 20 per cent, duty, the individual members of the firm of Powers & Weigh tin an made millions of dollars out of the manufacture of quinine, and it must be clear to the people that these millions were made up by contributions over and above the commercial value of the quinine. The inference is clearly legitimate that Messrs. Powers & Weight- man, and their one or two American competitors, would desire to main- tain the duty, and that the other sixty million of citizens would wish it abolished. In the protection days the manufacturers contracted with the whole- sale druggists to supply them at a certain maximum figure, guarantee- ing to give them any advantage which might occur in the market. In plain language, the makers shared some portion of their profits with the dealers. This they intimate they will do again if the latter will help them to a reimposition of a protective duty; hence, the action of the Wholesale Druggists’ Association, resolving that the tax should be re- imposed. Furthermore, as proved by experience, American quinine obtains an advance of from five to ten per cent, over foreigu, a fair protection of itself. The statement that American manufacturers would be bank- rupted by free quinine is met by Mr. J. S. Moore, who states that u there has not been a year that Messrs. Powers & Weightman produced so much quinine as in the year 1881, and, as a whole, there has been more quinine produced in the United States than ever before,” and challenges them to say he is not correct, and as the statement has not been contra- dicted to this day, it is fair to assume that it is correct. A natural inquiry is, why do the retail trade oppose the reimpositio of a tax on quinine? I am of the opinion that they do so, first, because quinine is at best so high that a reduction in price is of considerable benefit to them in satisfying customers ; second, that having reduced the price to meet the present conditions of trade, they are opposed to an arbitrary rise in price, which will necessitate a rearrangement of retail prices; third, they believe the principle wrong, that the many should be taxed for the benefit of the few; fourth, they do not believe the manufacturers would be injured more than the loss of the extra profit which the tariff would enable them to make ; fifth, they believe all the manufacturers would survive, and produce as much quinine with- out as with a duty, the only difference being the extent to which their greed was satisfied, a legitimate profit being assured in either case. As to the question of whether the consumer has been benefited or not, I have copied several letters which I have received, and which I will read : Mr. William Dale, of Chicago, says: I can see no reason wliy the tax on quinine should he reimposed. The consumer does not want it, the retail pharmacist does not desire it, and the only persons known to favor its reimposition are the manufacturers, and they only for their own gain, not ours. After considering the great fortunes made by the manufacturers on quinine with the tax on, I am not in favor of again taxing quinine in order that they may make a still greater profit. I fail to see where the injustice is in having quinine duty free. My customers get their quinine 25 per cent, cheaper now than when quinine was taxed for the benefit of the manufacturer and at my customers’ expense. ROBERT H. CO WDERY.] QUININE. 945 As Mr. Buck is here in person, I will not read the letter which I have here from him. He can speak for himself. Hr. H\ che, of the firm of H. R. Hyche & Co., says : I am in favor of keeping quinine duty free. The price has been materially reduced to the consumer, and no one who understands what he is talking of would make state- ments to the contrary were he properly informed. This reduced price to the consumer is directly due to the reduced price to us, as compared to the price when tbe duty was on. I see no injustice in not retaxing quinine. I do see an injustice to the whole nation when quinine is taxed. N. Gray Bartlett, professor of chemistry, doing business on the corner of Indiana avenue and Twenty-second street, says : I stamp all such statements as false, as far as I am concerned. I sell quinine 25 per cent, less than when the duty was on in 1879. The attempted reimposition of the tax I would regard as a fraud on the community. J. H. Wilson, retail dealer, doing business at Michigan avenue and Twenty-second street, says: I have sold quinine 25 per cent, less than my price in 1879, when the tax was on, and have done so since it touched $1.90. 1 have not raised it since this advance of 50 and 00 cents an ounce. I regard it an injustice to raise the price when we have just made our prices uniform to the consumer. Mr. Forsyth, of Forsyth & Co., says : We are selling quinine cheaper to-day than we ever sold it before. The reason is that the duty being off we can buy cheaper than we could when it was on. It would be a great injustice to us to reimpose the tax, and I have no sympathy to waste on the wealthy manufacturers of quinine. Messrs. Manville & Foote, retail dealers, corner of Wabash avenue and Twenty-second street^ say : We sell quinine cheaper by 25 per cent, than we did when the tax was on. The reason is that we can buy quinine cheaper with the tax off than in 1879, when the tax was on. We have not raised our price since the time when quinine was $1.90, and would regard it an injustice to reimpose the tax. The people do get the benefit of the decline, and this decline is due to an open market. In order to test this question still further, the wholesale trade were called upon. Mr. Peter Van Schaack, of the firm of Van Schaack, ►Ste- venson & Co., said : Although the manufacturers say so, I can see no reason, except sympathy, why a reimposition of the tax on quinine should be had. It was with.tliis feeling of sympa- thy for the manufacturer that I voted for the resolution at the meeting of the Western Wholesale Drug Association. Personally, I feel that the tax should not, be reimposed, and, candidly, I can tell you that I do not believe the tax will be reimposed. The whole people are against it, and the manufacturers are the only ones who desire it to be reimposed. As to the consumer not being benefited, every retail dealer knows better than that. Mr. Thomas Lord and Mr. G. W. Stantenburg, of the firm of Lord, Stantenburg & Co., were seen, and in reply said they did not believe the public were benefited ; that retail dealers charged the same amount for prescriptions containing quinine, regardless of the prices they paid for the quinine, and the public were not benefited. They did not believe that if the price was to vary from $1 to $10 that this would be true; but where the amount entering in the prescription was so small as to make a difference in cost of five cents or less, they believed the price to the consumer would not be changed; but in all cases where the amount made a difference in cost of ten cents or more, they had no doubt that the consumer obtained the benefit, and in sale of ounce quantities the consumer would get the benefit of the decline. H. Mis. 0 GO 946 TARIFF COMMISSION. [EOBEET H. COWDEBY. Mr. Plummer, of the firm of Morrison, Plummer & Co., said : I do not believe the price of quinine has been reduced to the consumer, but I do not know anything about it. I never buy it, and have not talked to the trade. Mr. O. F. Fuller, of the firm of Fuller & Fuller, said : I know that the price of quinine has been reduced to the consumer, because I have taken pains to inquire of druggists who came into this store, and the reduction ranges from 25 to 40 per cent, less than before. I thought this was true before I asked them, for the reason that druggists are commercial men and are too shrewd to maintain their price through a heavy decline such as quinine has experienced since 1879, when the tax was on. You wish to know my ideas of tariff as applied to quinine. They are the same as were held by Daniel Robbins, of the firm of McKesson & Robbins, before he went into the manufacture of quinine. He now argues the other way. Peoria, Tex. We write to say that we oppose the tax on quinine. Our customers get their qui- nine 25 per cent, cheaper than they did four years ago. Manufacturers who state that the price has not been reduced to the consumer, have not informed themselves as to the facts in the case, or else they make the statement knowing it to be false. Respectfully, CARMICHAEL & PORTER. Half -Moon Bay, Cal. I do emphatically say that I am not in favor of a reimposition of the tax on quinine , or any other necessity of the poor classes. Tax luxuries for the purpose of lowering taxes on articles for common use, is my motto. The price has certainly been reduced to the consumer. If those who assert that the consumer has received no benefit from the reduction in the price of quinine were retailers, they would see the folly of their position in the matter. Mixtures containing much quinine are necessarily so high, at best, that wo are glad to avail ourselves of any reduction in price, so that we can avoid complaints of high charges ; so the reduction helps us, in a measure. Respectfully, yours, CHAS. C. WALKER. Lipan, Tex. Quinine has been materially reduced in price since the duty has been taken off, and I am opposed to any tax or duty on quinine. Respectfully, yours, GEO. A. MORRISS, Druggist. Cleveland, Ohio. Dear Sir: I write to say that I do not favor an import duty on quinine. It has been sold at a lower price by about one-third since free of duty. P. J. SPENZER. Neola, Iowa. Dear Sir : The price of quinine has certainly been reduced to the consumer. I think, however, that to give American manufacturers a fair and equal chance that the duty on the bark should be abolished. Truly, yours, C. S. ROBBINS. N. B. — If the tax on bark is not abolished, I think there should be a tax on quinine. C. S. R. Chicago, III. Dear Sir: The statement that quinine has not been reduced to the consumer is without foundation in fact. e. k. mcpherson, pu. g. ROBERT H. COWDERY.] QUININE. 947 Mitchell, Ind. Dear Sir: All druggists in this section of the State agree that the price of qui- nine has been greatly reduced to' them and their patrons. The consumers have been greatly benefited, and would deplore any act of Congress looking to the retaxation of the precious drug. Let well enough alone, is our advice to Congress, and the manu- facturers of quinine will take care of themselves, without imposing the 25 per cent, now saved to the toiling masses by the late reduction. Duty-free quinine is what the people want. J. T. BIGGS. Little Rock, Ark. Dear Sir : If there be such a thing as a u Solid South” it is, I think, on the quinine question. I know of no druggist who favors reimposing the tax on quinine. It is claiming too much and placing too little an estimate on the honesty of druggists to maintain that quinine is not cheaper to the consumer since the removal of the tax. Whenever there is a reduction in the wholesale price there is likewise a reduction in the retail price, at least in this city, and the consumer generally knows the price of such a staple article as quinine, at least in ounce, eighth, or sixteenth vials. Yours, truly, T. J. DRAPER, Druggist. Minnekaune, Wis. Dear Sir : I think it would be a blessing for the poorer class of people if the duty was taken off of both quinine and cinchona bark, thus lowering the price. Yours, truly, JNO. J. HUBLEY. Colburn, Tippecanoe Co., Ind. Dear Sir : I regard the tax on quinine as unjust to the American citizens, and if the nation must have an income tax it should get it from somewhere else than suffering humanity. Yours, &c., C. W. CRIDER, M. D. Salinas, Cal. Dear Sir : I am opposed to the reimposition of the tax on quinine. E. K. ADAMS. Elmo, Tex. Dear Sir : I wish to say that I am emphatically opposed to the reimposition of the tax on quinine. I can say, candidly, the cheaper I buy quinine the cheaper my customers get it, whether they want it by the ounce, drachm, or in prescriptions. Yours, &c., M. H. STRAIN. Here, gentlemen, is a list of the druggists who are disinclined to see the tax on quinine reimposed, and the list represents all upon whom we were able to call : Chicago, September 26, 1882. To the honorable members of the Tariff Commission, meeting in Chicago September 7, 8, and 9, 1882: The following druggists of the city of Chicago hereby most earnestly protest against the reimposition of a tax on quinine, for the following reasons : 1st. The retailer is now able to purchase in an open market at much less price than if the tariff was in force. 2d. The price of quinine has been reduced to the consumer 33£ per cent, since the repeal of the tariff. 948 TARIFF COMMISSION. [ROBERT H. COWDERY. 3d. The class benefited by this reduction m price are persons needing protection from the government more than tbe wealthy manufacturer. 4th. The fact that manufacturers have since the repeal of this tariff increased their capacity for production, shows that quinine can be made at a profit when duty free, 5th. It is one of the most important medicines used for the alleviation of humai suffering and the cure of disease, and therefore ought to be free from duty. Signed by — B. Van Buren, 1248 W. Madison street. H. S. Maynard, 626 W. Lake street. A. S. Stoddard, 756 W. Lake street. R. T. Sill, 628 W. Lake street. H. A. Hinckley, 756 Lake street. C. B. Wilson, 785 W. Madison street. Jno. B. Jones, 731 W. Madison street. R. M. Barber, 636 W. Madison street. F. A. Morrell, 690 W. Madison street. George H. Hall, 894 W. Lake street. R. R. Hunton, 777 W. Van Buren street. H. D. Garvin, M. D.,748 W. Van Buren street. G. W. Tucker, 296 Ogden avenue. J. H. Beareroft & Co., 884 W. Madison st. George H. White, 826 Madison street. Jas. C. Moody, 722 W. Lake street. C. H. Wilcox, 833 and 835 W. Lake street. Herman F. Kraft, 641 W. Madison street. L. Schreiber & Co., 482 W. Lake street. Chas. Hegemanu,298 W. Lake street. Ilartwig & Ritter, 180 W. Madison street. Chas. F. Hart wig, 426 Milwaukee avenue. R. H. Hatzfeld, 56 W. Randolph street. E. A. Holroyd, 1014 W. Lake street. Laux & Woltmann, 869 and 504 North Clark street- List & Uhlerdorf, 2506 State street. II. Hantan, 156 W. Randolph street. Reuter & Co., 168 S. Halsted street. Robt. E. Storey, 183 W. Madison street* H. Schroeder, 453 Milwaukee avenue. A. C. Brandecke, 468 W. Chicago avenue. A. A. Woods, 478 W. Indiana street. Geo. L. Corke, 372 W. Indiana street. Wilhelm Bodemanu, 239 State street. Geo. P. Martin, 271 N. Clark street, cor Chestnut. Adolf G. Vogeler, 445 N. Clark street. Andrew Scherer, 381 Division street. F. Liese, 451 Larrabee street. Buck & Ravner, cor. State & Madison street, and 117 South Clark street. Robert H. Cawdrey, 527 State street. Clark Brothers, 511 State street. Chas. C. Fredigke, 472 S. State street. Smith & Hogey, 441 S. State street. A. C. Welirli. Hugo W. C. Martin, 358 State street. Edwin J. Painter, 1401 State street. John Parsons, 1409 Wabash avenue. J. W. Triman, 522 Wabash avenue. G. C. Moore, 519 Wabash avenue. C. C. Cullins, 324 State street. Wm. Dougherty. Charles Kotzenberg, Union Stock Yards. Eberts’ Pharmacy, 584 State street. C. M. Weinberger, 219 Wells street. Jos. F. Brabrook, 160 W. Harrison street. William Jauncey, 310 and 312 W. Indiana si T*00 1 Rich’d C. Knox, 561 W. Twelfth street. James M. Kiskley & Co., 134 S. Halsted street. H. H. McPherson, 530 W. Indiana street. John C. Henderson, 951 Lake street, and 1049 Madison street. L. K. Waldron, 189 Randolph street. A. C. Vanderburgh & Co., 83 Randolph street. J. S. Jacobus, N. E. Cor. Indiana avenue and Thirty-first street. By Commissioner Garland : Question. I understand you that when the duty was taken off the retail price was reduced 25 per cent. ? — Answer. Yes, sir. Q. What is the common retail price of quinine now ? — A. It is about 1A cents per grain, in small quantities. Q. What per cent, of profit is that on the present price of quinine ? — A. Something like 100 per cent., for small quantities. There is in that a certain amount of loss, of course ; but when it is sold in ounce or half- once quantities the advance is only about twenty-five cents on the half ounce. Q. If a duty of 10 per cent, were added, as asked by the manufact- urers, what would the profit be then, selling at the same price as now l — A. That would depend upon whether the 10 jier cent, only was added. Q. I am supposing that that amount only was added ? — A. In that case it would sell, as near as I can guess at it, at about 180 per cent. By Commissioner Underwood : Q. How many quinine manufacuturers are there in this country? — A. Three. Q. It has been stated to us that Powers & Weightman control the prices of quinine ; what is your opinion about that ? — A. That is one ROBERT H. COWDEEY.] QUININE. 949 great objection we have to asking the tariff on it, for the reason that when quinine is taxed it virtually gives to Powers & Weightman the control of it, so that when they find an importer receiving quinine in this country quinine comes down so that the importer cannot sell it at a profit. Immediately that there is none imported, Powers & Weight- man raise the prices. Q. Do Bosengarten and others follow Powers & Weightman in raising the prices'?— A. Their prices have been identical for the last twelve years, so far as I have known. Q. In other words, when Powers & Weightman take snuff, Bosen- garten & Co. sneeze ? — A. Yes, sir. By Commissioner Porter : Q. There is not more than about a million dollars invested in that, is there ? — A. It would be pretty hard for me, as retail dealer, to say what it is. Taking the statements of the manufacturers, there is a good deal more than that; but, as I know of no manufacturer of it who is a retailer, I should think it was entirely unnecessary for that amount of capital to be invested in two or three houses. We have no way of tell- ing, however, except by their own statements. Q. We are informed that there are only about three hundred people engaged in its manufacture. — A. I think they estimate it themselves at not more than three hundred persons, workmen and all. In that same connection, I would state that one party who has been most active in it is not a manufacturer in the true sense of the term; lie is only a bottler. By Commissioner Oliver : Q. Is it true that there is a syndicate abroad who control the sale of the article'? — A. We have very much to be thankful for that this summer, at least, we were without a protective tariff on quinine, owing to the syndicate in London and New York holding almost entire con- trol of it. Q. Then there is a syndicate abroad manufacturing quinine 1 — A. No, sir; they were the syndicate holding the bark. The syndicate in New York were holding quinine. I will not say, because I do not know the fact, whether the two syndicates were acting in unison or not ; but, so far as I know, they were not. If I understand the drift of your ques- tion, it was as to whether there was a syndicate in the Old World that were ready and willing, if opportunity offered, to crush the manufacturer here. I am willing to state that I do not believe there is. I have the state- ment of Mr. Morrison here, who is in favor of the reimposition of the tax. He states that from selfish motives — he makes no bones of it — he can make more money. He said they had tried tbeir best, and were ready to take the inevitable, and that was, meeting Powers & Weightman on a square basis. Q. It is stated that a concern in Italy, at Milan, and Howard & Co., of London, and a French company, are now in the hands of one or two parties, who have pressed the prices here to drive out the xlmerican manufacturers. Do you know anything about that*? — A. I know that the Howard Company, I believe it is called, have consolidated with two others, which makes a company that produces as much, almost, as Pow- ers & Weightman and our other manufacturers do here. That is my impression. Q. As to quality, which is the best, or is there any difference between the foreign article and the American? — A. Dp to last August I had the idea that the German quinine, particularly, was inferior to ours manu- factured in this country. Last August, however, from being thrown 950 TARIFF COMMISSION. [ROBERT H. COWDERY. into communication with a person in Milwaukee who had spent con- siderable time on the subject of the adulteration of, or inferior, quinine, and who is a member of the druggists’ association of Wisconsin, I was convinced that the German is as good ours, and even better, to this ex- tent : that while ours contained a larger amount of moisture, the foreign contains less, making it proportionately so much the better. It was welcome news to me. Q. Is it not the impression among physicians that the American qui- nine is the best? — A. Yes 5 and that was the opinion among the phar- maceutists also. Q. The demands of our market may have caused them to improve the quality of the article? — A. I do not think so. It is generally true that the larger the demand the lower the quality. Q. Are not our people more critical, and do they not want better goods ? — A. Quinine is peculiarly hard to determine as to its quality, and it is not every retail druggist that can do it; and there are not nearly so many physicians who are able to analyze it and determine it for themselves as there are among pharmaceutists. There may possi- bly have been an improvement in the foreign quinine, coming through the feeling of the druggists here, that it was inferior, and they may have taken particular care to send over a good article in order to over- come that prejudice on our part. GEOliGB BUCK.] QUININE. 951 GEORGE BUCK. Chicago, III., September 7, 1882. Mr. George Buck, of the firm of Buck & Rayner, druggists, of Chicago, appeared before the Commission and made the following state- ment: I have not come prepared to make any statement to the Commission; I was requested to be here to answer questions only; but I would like to correct one remark that Mr. Cowdery made. One of the Commis- sioners asked him how much he charged on bark, and he answered cents a grain. He knows just as well as I do that that is for quantities of less than ten grains. I said I had not expected to make any statement here, because it was not asked of me, but that I was only asked to be here to answer ques- tions. But I wish to state briefly that on this question of free trade and protection, I lived in England myself the first 25 years of my life, and I think if you are going to have protection, for gracious’ sake leave quinine alone; don’t compare it with pig iron, because millions of people are benefited by quinine while very few are specially benefited by pig iron. I am afraid those who make the statement that the consum- er does not get the benefit of a reduction state what is not true. The consumer does get a benefit. We pay $2.25 an ounce for quinine, and we sell to any man who comes to us, at 50 cents a drachm; that would be a little over $3.50 an ounce. If he wants to buy an ounce, we always charge him a profit of 50 cents an ounce, and we charge him 75 cents an ounce more when we have to weigh out a drachm for him. We think we should be paid for our labor, but not at the rate of 190 per cent., according to that lie that has been circulated in Congress. I was sorry to hear Mr. Cowdery state that that was our price. It is not so at all. Gentlemen, I think I have said, enough. By Commissioner Ambler : Question. What was the price per drachm, say in 1879 ? — Answer. We have charged a dollar a drachm; then it cost, I think, about $4.50. We have reduced it to 85 cents and 75 cents, and now it is 50 cents. Q. Say in 1879, just before the duty was taken oft', what was ihe cur- rent price ? — A. If you can tell me what we paid for it I can answer ; but without that I cannot tell. (A Bystander. Three dollars and fifty cents.) Q. Do I understand you that the reduction from $3.50 to $1.90 was occasioned by the removal of the 20 per cent, duty t — A. 1 do not know that; but I have no doubt it had something to do with it. Q. Then I do not understand you to attribute that to the removal ? — A. I have no doubt it had a great deal to do with it; whether it has all I do not know. It may have been partly owing to the manipulation of speculators, and by one house in this country, in order to affect the price. I think that affects the price a great deal more than the duty affects it. If you destroy competition you will have a very important factor in the price. Q. How does it destroy competition ? — A. Because it would not pay to make it. 952 TARIFF COMMISSION. [GEORGE BUCK. Q. You can pay the 20 per cent, and still it would leave a very con- siderable margin? — A. In answer to that I must point you to the ex- perience of dealers ever since the duty has been off. We all know that the foreign article has been brought into this country in enormous quan- tities ; prior to that, when the duty was on, we did not have it. Q. If Powers & Weightman, and Eosengarten & Co., who were then substantially the only makers of quinine in tbe country, had put it at $3.50 an ounce, and it was being produced in Great Britain so that it could be sold at $1.80, they could still have had a pretty good margin; does it not seem so to you ? — A. No, sir; I only point to experience. Q. It is said, on one hand, that the reduction in the price of quinine has been on account of the discovery of extensive deposits or supplies of bark, and that there has been just as marked a reduction in Europe as here. As a matter of course, the reduction in Europe would not be occasioned by the taking off' of our tariff, I suppose. Or, if it affected the prices there at all, it would raise them, because they could export their quinine to this country and sell it here. Now, if that is the fact — and per- haps you can tell me whether it is or not — if it is the fact that the prices in Europe in the leadiug markets have been reduced to the same extent as here, it would seem as if there was some other reason for it than the abolition or reduction of the duty here ? — A. As I said before, quinine is a peculiar article in some respects; it is like wheat; you can never tell whether a certain price is a legitimate price, because it is speculated in by dealers and manufacturers. But, as a general principle, imposing a duty which can only benefit less than a thousand people cannot be very good. Q. If it does not benefit anybody but the producer, clearly you are right; but the question is whether it does or does not. — A. I do not see how it does it by saying that the consumer don’t get the benefit of it. Q. I am not speaking of that now. It is a fact that on both sides of the water the manufacture of quinine is now substantially monopo- lized ? — A. I do not know that. Q. Do you know whether it is a fact, as claimed by gentlemen who represent the opposite side, that the firm in Milan, Howard & Go., of London, and Pelletier, in France, make substantially all the quinine in Europe? — A. No, sir. I know of other makers, but I have no doubt that they make the largest part. Q. Pelletier’s establishment is a large one, and it is claimed that they absorb the other establishments. — A. I do not know whether that is so or not. Q. Suppose it to be a fact that those houses make substantially all the quinine that is made there, and that they have combined (which is also claimed), so that in substance it is in their hands; then it would seem to be desirable that there should be competition on this side of the water, if possible"? — A. I do not understand that that is the state of things at all. Q. I do not say that it is. I am only telling you what is claimed to be the fact by the other side of the house; I know nothing about it. — A. I should have grave doubts whether it is true. Q. I thought perhaps you might be advised as to whether these state- ments are correct or not that have been made to us, and for that reason I ask. — A. I do not see why Congress should protect the American man- ufacturers and the public not get the benefit of competition. I defy anybody to prove that it directly benefits more than 1,000 people in the United States. Q. You seem to overlook the fact that I am not trying to prove any- GEORGE BUCK.] QUININE. 953 thing, or assuming anything as of my own knowledge on the subject. I absolutely know nothing about it except as you and other gentlemen come here as witnesses from time to time and make these different state- ments to us. I want to know if these things had occurred to you, and if they had been taken into consideration in the opinion you have ex- pressed. I wanted to know whether you knew them to be true, and what effect, if they were true, that w r ould have upon your judgment. It is quite probable you are right in your view that quinine ought to be kept where it is — on the free list. — A. I try to state the facts. Q. I understand you are not advised. — A. Yes, sir ; I am advised. I am advised that the position you take is not the true position. Q. I beg your pardon. What position did I take *? — A. You assumed that there were three manufacturers Q. I beg pardon ; I assumed nothing. I said such statements had been made to us. I expressly declared to you that I did not know. I do not want you to charge me with making an assumption, when 1 tell you that I do not know whether they are true or not ; and I wanted to know if you knew. — A. I told you we had used other quinine. Q. I understand ; but at the same time, you said you did not know whether these gentlemen who had made these statements were or were not correct in saying that those three houses named, if they combined, would have a substantial monopoly ? — A. I think your question led to a great deal more. Q. I said that if by their combination they could crowd out the little concerns in Europe, and also crowd out the American producers, what would the effect be of such a combination in reference to quinine*? — A. If your premises are not correct, am I not to correct you ? Commissioner Ambler. Certainly. The Witness. I think your premises are wholly incorrect, because there are manufacturers in Europe besides those you name, and I am not informed of the syndicate you speak of, and therefore do not know about that; but I do know that your premises are not correct. Q. The question was not whether there were other manufacturers, but whether there were such combinations as we have been told existed*? — A. I am not informed about that. By Commissioner Oliver : Q. What was the effect on quinine six months or immediately after taking off the duty *? — A. Speaking from memory, it went down, and then advanced. As I stated a moment ago, quinine is a good deal like wheat ; you can’t tell about the prices. By Commissioner McMahon : Q. The retail price, or wholesale, or both ? — A. The retail price has always been governed by what we pay for it. By Commissioner Oliver : Q. You give no reason, then, for the advance in price after taking off the duty? — A. No, sir. 1 have my own ideas of it, but I might be in- correct about that. I think that the manufacturers’ operations have tended to advance the price; it would be very easy for them to do it; it is easy for them to control the market, and there is no doubt but that is done both here and in Europe. It will always be speculated in ; it is an easy thiug to speculate in. Mr. Bobert Cowdery was permitted to reply to Mr. Buck as fol- lows: I think, if I remember, the tax was not actually removed until, say, 954 TARIFF COMMISSION. f GEORGE BUCK. the 1st of July, 1879. The price of quinine did advance immediately alter the action of Congress, stating that it should be taken off only at that time. But I have always thought that that advance was simply in consequence of the action of Powers & Weightman, for then came circulars from them urging the retailers to make every endeavor to have the import duty reiinposed. At the time that the duty was actually taken off it was worth $3.50, and the next day after the 1st of July it was still worth $3.50, and so it remained during the whole month of July ; but in August the price ran down to $3.10, aud it has been com- ing down continually from that day to this. In December, 1881, it was down to $1.90, so that ever since Powers & Weightman gave up the idea of the retailers helping them to secure a reimposition of the tax, it has actually been on the downward tendency. J. A. WHITTIEK ET AL.] LUMBER. 955 J. A. WHITTIER, ET AL. Chicago, September 7, 1882. Mr. J. A. Whittier, of East Saginaw, Micli., president of the Sagi- naw Board of Trade, appeared (with other gentlemen representing the lumber interests of Michigan) before the Commission and made the fol- lowing statement : Mr. President : I preface what I have to say by stating that we are a delegation from Saginaw, chosen by the Saginaw Board of Trade. We have consulted the lumbermen there, and we think we represent the con- ditions of the lumbermen’s business in Michigan correctly, so that there will be no difference of opinion among the lumbermen in any part of our State ; and, further, we think that the representations we make give a fair statement of the lumber business of the entire Northwest. A brief statement of the condition and magnitude of the lumber in- dustry of Michigan is necessary to a clear understanding of our reasons for asking that the present moderate duty on lumber be retained. The total product of Michigan in 1881 was estimated by our lumber journals as follows, and this estimate agrees very nearly with the cen- sus report : Feet. Upper Peninsula 450, 000, 000 The Saginaw Valley 1, Oil, 000, 000 The Lake Huron shore 320, 000, 000 Lake Michigan shore : White Lake 120, 000, 000 Manistee 225, 000, 000 Ludington 120, 000, 000 Muskegon 632, 500, 000 Grand Haven and Spring Lake 191, 000, 000 Miscellaneous 75, 000, 000 Interior mills : Chicago and West Michigan railroads 65, 000, 000 Grand Rapids and Indiana Railroad 196, 000, 000 Detroit, Lansing, and Northern 84, 000, 000 Michigan Central Railroad (Mackinaw and Bay City division) 85, 000, 000 Flint and Pere Marquette Railroad 145, 000, 000 Miscellaneous 200, 000, 000 Total feet 3, 919, 500, 000 To be rather below than above the fact, we will call this total 3,850,000,000 feet, and this is sawed lumber alone, exclusive of shingles, lath, staves, hewed timber, and hard wood, worth several millions. It is safe to say that our total forest product this year is worth over $60,000,000. CAPITAL INVESTED. To manufacture this product, capital must be invested as follows : Mill property $30, 000, 000 Tools, teams, sleds, booms and apparatus, &c., floating investment esti- mated at $2.50 per M feet of lumber produced 10, 000, 000 Total 40, 000, 000 The large investments in pine lands, counting many millions, are not included in this estimate. 956 TARIFF COMMISSION. [J. A. WHITTIER ET AL. MEN EMPLOYED — WAGES. Twenty-one thousand men in saw-mills, average wages $2 per day, or, daily, $42,000. * Thirty-five thousand men in forest camps, logging, &c., at $1.75 per day, a daily pay of $61,250. This estimate is rather below the fact, as the pay-rolls of several large mills in Saginaw for the past few months average $2.05 to $2.10 per day. The mill men are employed 200 days in the year ; the men in lumber camps 150 days, on an average. This will give total yearly wages as follows : In saw-mills, 21,000 men, 200 (lays $8,400,000 In lumber camps, 35,000 men, 150 days 9, 185, 000 Total 17,585,500 The standing pine tree jn the forest is the raw material, and for that a round sum is paid, and the conversion of that raw material into lum- ber is by the sturdy axe stroke and the solid day’s work of this army of men, at the cost above given for wages. Estimate the thousands of men employed on cars and vessels in transporting this lumber, and you add over $4,000,000 to the yearly wages paid. Careful estimates lead to the conclusion that the lumber industry of our State pays the farmers for food for man and beast over $6,000,000 yearly, and the mechanic and manufacturers some $4,000,000, thus illustrating the mutual benefit and interdependence of these industries. COST OF MAKING LUMBER. Our estimate of the cost of manufacture is based on Saginaw Yalley business, and may fairly apply to our State. Our level country, many streams, along lake coasts, railroads, and large mills, with best ma- chinery, make expenses as small as anywhere. Calling two miles and a half an average distance from water or rail for hauling logs, we give : Cutting and getting logs to water, per M $3 75 Driving to booms 75 Boom age and delivery to mills 100 Sawing 2 50 Inspecting, scaling, and commissions 50 Stumpage 4 50 Shrinkage, loss, insurance, and incidentals 50 Total cost 13 50 The average price received would be : 25 per cent, culls, at $8.. $2 00 72 per cent, common, at $16 11 52 3 per cent, uppers, at $35 1 05 Total 14 57 This leaves a margin of $1.07 per M. for the making, or a trifle over half the duty, and this is the estimate in a year of good business, far better than the average. The lumber product of Wisconsin and Minnesota is about equal to that of Michigan, and these three States furnish about one-third of the total of the United States. J. A. WHITTIER ET AL.] LUMBER. 957 SOUTHERN PINE. The United States census report of 1880 gives 230,000,000,000 feet of standing pine in the South and Southwest; as the utilizing of these val- uable forests is just beginning, whatever in business or legislation affects the lumber market will reach and affect these. If we take in the whole lumber industry of the United States we shall find 9,000 men working in mills, and 135,000 in forests, with yearly wages of $80,000,000; capital invested in mills and apparatus, $180,000,000; a total yearly product of $230,000,000 in value ; and the farmers in re- ceipt of $30,000,000 yearly for food of men and animals. CANADIAN TIMBER. Along our borders, with only the river and lakes between, are the pine forests and mills of Canada. Great tracts of pine land in that coun- try are held by the government as “land limits” or “ berths,” and the right to cut timber on them is sold at auction. The buyer pays no taxes, but a yearly ground rent of $2 to $10 per square mile “crown dues ” on what timber he cuts and such bonus in cash as he may bid at the sale. Inl874 “The LumberTrade” journal inBoston gives the costof stump- age or standing trees, including the “bonus” and “crown dues.” at about 75 cents per thousand feet. It is more to-day. These “land limits” are from 10 to 50 miles square. In the Georgian Bay region in Decem- ber, 1881, at an auction sale, 1,281 square miles were sold, the bonus and royalty on which would make the stumpage cost $1.75 per thousand feet on timber actually cut. Lands in private hands sell somewhat higher, but this system keeps prices much below ours, and vast tracts are held by these lumbermen. James Little, of Montreal, for instance, is said to own some 400 square miles of these “limits.” In case of for- est fires, the lumberman only loses his moderate bonus paid for the priv- ilege of cutting the timber, but the loss by fire falls on the government ; not on him. A Canadian statement in 1872 puts the area of pine lands north of the Saint Lawrence at 287,000 square miles. Not only does that government sell these land limits low, and run its own risk of fires, but it builds slides, booms, and bridges. A report of the minister of pub- lic works gives a list of seventy-one stations on the Ottawa Biver and its branches, where government has built 5,000 feet of canals, 7,000 feet of slides, 62,000 feet of booms, thousands of feet of bridges, houses for keepers, &c., spending large sums for the benefit of lumbermen. Canadian labor is about 30 per cent, lower in lumbering than here. In the Toronto Globe, Hon. J. C. Miller says, in 1880, that “3,000 men are employed in Muskoka and Parry Sound at average wages under $15 per month and board, while in the Michigan camps the average exceeds $20.” At this rate the Michigan lumbermen receive $4,500,000 yearly more than Canadians would get for the same labor at home; and there- fore thousands of them come to our camps and mills for better pay, and many remain here as good citizens. Canadian labor at home is not over $6 per M feet of lumber, while $8.50 would be a low estimate with us. Stumpage is from $3 to $5, and over, per M with us ; in Canada from $1 to $2. J. C. Miller writes to the Toronto Globe, “ Stumpage on the standing timber that sells readily in Michigan for $5 is hardly salable here for $2.” It will be noticed that the difference either in labor or stumpage is 958 TARIFF COMMISSION. fj. A. WHITTIER ET AL. greater than tlie duty of $2 per thousand feet. This stumpage, or price of pine lands, is not speculative or stock jobbing, but is constantly paid when the timber is to be cut immediately. A Michigan pine-land owner gives his taxes as 15 cents per acre, or $96 per square mile; more than ten times the ground rent paid for a Canada land limit. The Canadian Government excludes settlers from the limits they sell, that they may have less risks from forest fires. Ours encourages settlers in our forests, and so increases that risk, which the land owner alone bears. When our government can furnish pine lands on such easy terms, as- sume the losses by fire, and build us booms and bridges, as that of Can- ada does, free trade in lumber might be nearer just ; but to grant ben- efits to foreigners who bear no burden here and few at home, and who are thus favored by their own government, would be flagrant injustice. If we are to have free trale let our government give us such aid and benefit as that of Canada does to her lumbermen, and thus make us equal. The difference in wages is quite equal to the duty, but we have no power or wish to bring our wages down to the Canadian level. FOREST FIRES. The risk increases as the country is settled. Probably $8,000,000 per year would not more than cover the value of pine timber burned over in Michigan, and the scorched forest must be cut down or it is worth- less. This makes it difficult to keep back the cutting of our lumber; and it is desirable to hold back the too great influx from Canada, that their great forests may be our timber preserve for use when ours are gone. Experience under reciprocity and its free trade with Canada showed that prices of lumber were not greatly affected, as our large supply had strongest influence on values, but our Canadian neighbors could flood our market greatly to our injury. SALT AND LUMBER. The making of salt, in which Michigan is now the leading State, is interlinked with lumber, so that the existence and prosperity of one vitally affects the other. These statements we believe, and know, indeed, from some consulta- tion, will meet the views of lumbermen in Muskegon and other large producing districts. The duty on lumber is but 10 to 15 per cent., one of the most mod- erate in our tariff*. It pays a revenue of about $1,000,000 yearly, helps to keep up wages, does not affect the price to anything like its amount, gives a large home market to the farmers, is some partial compensation to balance the favor the Canadian Government gives to their lumber industry, and therefore we ask respectfully that you recommend the present customs duties on lumber of all kinds. 1 append some letters from mill-owners in Saginaw, showing the wages of lumbermen, prices of lumber, &c.: Office, Saginaw, Mich., September 6 , 1882 . Mr. Ezra Rust: Dear Sir : In reply to your request, we find that our accounts show that the aver- age wages paid our men at Zilwaukie Mill fior labor in handling and sawing logs and lumber is $2.06 per day per man. Respectfully, RUST, EATON & CO., J. A. WHITTIER ET AL.J LUMBER. 959 . East Saginaw, Mich., September 5, 1882. Hon. J. A. Whittin, President Board of Trade, East Saginaw, Mich. : Dear Sir ; In my judgment, the standing price of Michigan is worth on the stump from $3 to $5 per M feet, board measure, according to location and quality. Yours, truly, WM. L. WEBBER. East Saginaw, September 6, 1882. To the Committee to meet Tariff Commission : Gentlemen : The average wages paid the men per day in our employ, manufactur- ing lumber, is $2.10 each. Yours, respectfully, &c., SANBORN & BLISS. East Saginaw, Mich., September 6, 1882. To Board of Trade, East Saginaw, Mich. : Gentlemen : In the manufacture of lumber at our mill we are paying the following wages, which show an average of $2.07 per day, viz : 2 men, at $4 $8 00 6 men, at 3 18 00 18 men, at 2 36 00 22 men, at 1.75 38 50 4 men, at 1.87 £ 7 50 2 men, at 2.25 4 50 2 men, at 2.37£ 4 75 2 men, at 2.12-J 4 25 1 man, at 2.50 2 50 1 man, at 1.62£ 1 62 1 ihan, at 1 1 00 61 126 52 Average 2 07 Yours, truly, CHAS. MERRILL & CO. If you desire to know anything more in relation to Canada lands, Mr. Hill, who is one of our delegation, has attended sales and is thoroughly familiar with their style and manner of doing business. By Commissioner Ambler : Q. Do you represent the salt interests of the Saginaw Valley, as well as the lumber interests? — A. Yes; last year we made 2,700,000 barrels, and this year the expectation is that it will exceed 3,000,000 barrels. Q. Do you know at what price salt is furnished? — A. It is sold there at 70 cents a barrel, net ; 280 pounds to the barrel. Q. That includes the package ? — A. Yes, sir ; and some sells in bulk at 25 cents less. Q. How does that compare with prices of salt in other salt-producing districts ? — A. That is about the price salt is selling at in Syracuse, as I understand. By Commissioner Boteler : Q. Could you submit to any reduction of duty on lumber ? — A. It would give a large influx of Canada lumber. Perhaps this year it might not affect us very much, because the demand is in excess of the supply, and has been this year, but there are times when the supply is in excess of the demand, and then if Canada lumber was allowed to come in to flood our market it would have a tendency to reduce our prices very much. 960 TARIFF COMMISSION. [J. A. WHITT TER ET AL. By Commissioner Kenner: Q. Did I understand you to say that the price of sawed lumber at your mills is $13 a thousand on an average? — A. No, sir; we reported that at $8, $16, and $35 for three different qualities. The average is $14.57; $13.50 for the average standing tree and its manufacture into lumber. Q. What does it cost to deliver it at the mill? — A. That is a difficult question to answer, as well as a difficult thing to get at, in relation to these percentages. There is a large amount of timber that does not come up to that average. Formerly we selected what we took off the land, but now we take it all. Norway scantling joists we make a con- siderable quantity of, and that is selling at $10 to $10.50 per thousand feet. Q. I understand you to say that your lumber in the log, delivered at the mill, costs you an average of $13 per thousand? — A. No, that is the lumber. Q. What do the logs cost delivered at the mill ? — A. Sawing is about $2.50; that would reduce it to about $11; and there are some other items there that would perhaps reduce it to an average of about $9.50 to $10. The logs stand near or remote, and they are of better or imorer quality, and the price of them depends upon those things. We tried to establish an average. Q. The principal item in the cost is manual labor and hauling, is it not? — A. This statement as to the cost of lumber at the mill compre- hends $4.50 stumpage, and it comprehends $2.50 sawing, and then there is the insurance, inspection of the lumber, &c., that come in as an ex- panse, which make it come up to $13.50. Discount $2.50, and it makes $11. There is another dollar that could be discounted for inspection, shrinkage, &c., which would bring it down to $10. I should think $10 would be just about what the average would be worth. I know there is a lot of three million feet, and I have thought, on inspection, that that is just about what it would be worth, and a party has offered $10 for it. By Commissioner Garland : Q. Are not those pine lands generally owned by the lumber manu- facturers ? — A. Yes, many of them are, but there is a large amount of pine lands owned by outsiders who are not manufacturers. Q. Does the timber upon those lands run uniformly ? — A. No ; some of it is small sap timber, some clean Norway, and some pine. Q. I notice in your estimate that one-third of the cost of your timber is accounted for as stumpage ; is not that too high a proportion ? — A. No, I think not. Q. Are the mills not owned by the men who make the lumber, as a rule ? — A. There are many mill-owners that own tracts of pine, none of them very large tracts. Some of the largest land-owners are not mill- owners at all. In Muskegon the rule is for the mill men to buy their logs, and very few of them own tracts of pine. The Saginaw mill men more generally have more or less pine. By Commissioner Kenner : Q. What do you mean by the word “stumpage v ? — A. The value of the tree as it stands in the woods. Q. And in computing that value, you estimate the average value of the trees ? — A. Yes, sir. Q. Are your trees worth $4.50 on the stump ? — A. Yes, taking that as the average quality that we have adopted. J, A. WHITTIEU ET AL.] LUMBER. 961 Q. Putting the stumpage at $4.50 and the value of your logs at the mill at $10, that makes $5.50 for the labor of bringing it to the mill — the transportation, cutting, &c. ? — A. Yes, the rest of it would be labor and pro tit. Q. How many trees will a man cut in a day ? — A. That depends upon his strength and whether the timber is large or small. The crews work interchangeably on chopping and sawing. Probably a half crew of live men would chop 100 to 125 logs a day. Most of the lumbermen have their teams, and do more or less of their lumbering themselves. We cut about twenty million feet a year. We hire our men and put in our own timber. By Commissioner Garland : Q. Ho you put the land in cultivation after the timber is cut off ? — A. That depends a little. If it is pine, mixed with other growth, the land is apt to be a little better, and will bear cultivation. Large tracts of that kind of land in the center of the State are now settled up, but up on the eastern side of the State the land is low, sandy, and of black growth. We have considerable land that we would be glad to have somebody give us $1 an acre for. We do not like settlers very near us for awhile, on account of the dangers of fire When they are clearing their lands they have to start their fires, which are apt to spread. By Commissioner Kenner : Q. How many trees do you cut per acre ? — A. From 10,000 to 12,000, although there is considerable difference in different localities. We have some small timber that cuts remarkably well. There is not much to reject, and it runs from 14,000 to 15,000. We consider that a good yield. Q. You say five men cut 125 trees a day ; could those men remove all those trees off* of an acre of land in a day ? — A. This timber I am speak- ing of would run about eight logs to the thousand feet. Q. The trees are small, as a rule ? — A. Those that I am speaking of are. Q. What is the largest yield you have ever known per thousand feet ? — A. The largest trees are most all cut off in our country. I would not say positively, but my impression is that I knew one tree that cut between 4,000 and 5,000 feet. Q. Is that the largest tree you ever heard of? — A. That is the largest tree I ever saw, but 1 have no positive recollection about it. The com- pany I speak of handle about 5,000 feet of logs, and the average stock that runs through there is about eight logs to the thousand feet. Ten thousand to the acre is pretty good land. In buying a tract of land you will get considerable land that has nothing on it. By Commissioner Garland : Q. I understood you to place 10,000 as the lowest limit ? — A. Oh, no, I did not intend that, because in buying sometimes you will get 40 or 80 acres that will have enough timber on one end to make it profitable, while there is nothing on the other end but a swamp. Q. I understood you to place 10,000 as the lower limit and 15,000 as the upper? — A. Oh, no, I did not mean that. Q. What is the land worth on an average? — A. Timber land does not, as a rule, go by the acre. A man offers a lot of pine lands, and the person to whom it is offered inspects it and estimates the value of the logs upon it according to the quality of the timber, distance from the river, expense of driving it into the boom, &c. It is a pretty hard Mis. 6 61 962 TARIFF COMMISSION. [J. A. WHITTIER ET AL. thing to generalize these things, to give a person not pretty well ac- quainted with the business a clear idea of it. Q. Do I understand you that those sales are based upon an estimate of $4.50 a thousand for the lumber? — A. We should consider that an average price of land — average in locality, quality, distance of hauling, and expense of driving. I bought a little lot not a great while ago where it was mixed, where two trees would be standing together in one place and one in another, so that I never could induce anybody to buy the piece. It was objectionable because of the small quantity of tim- ber. We paid $3.50 for it. We have to estimate now for everything that we get. By Commissioner Porter : Q. I understand you to recommend the Commission that the duties on lumber remain just as they are. Have you any suggestion to make to the Commission in regard to the simplification of the schedule ? — A. I don’t know that I have. Perhaps Mr. Hill or Mr. Es tab rook might have a little information to give you on that point, but I am not familiar enough with that subject to enable me to talk about it. By Commissioner Oliver : Q. It has been stated to the Commission by some parties that it would be wise policy to take off the duty on Canadian lumber, so as to consume that and preserve our own, for the reason that we are fast consuming our own stock. — A. The answer to that would be that the preservation of ours is an impossibility. The settlers go in among our timber and the fire follows the settlers. Our Michigan woods are filled with settlers wherever they can get in, and they are crowding in at all points. Wherever a man has finished his little tract of pine, he will sell out for what he can get, and settlers will come in. Q. Does that difficulty exist in Canada ? — A. It seems not, from the statement that I read here that was furnished by Mr. Hill ; he was over there. It seems that the policy of the government there is to keep set- tlers out. If pine lies 12 months after it is burned over, the grubs get into it and bore it so that it is practically valueless. Logs are sometimes left on the skids in the winter for want of snow, and very often those logs are very materially injured by grubs. I have seen many thousand feet thrown out for that reason. Q. You advance the proposition, then, that if we do not use the lum- ber it will be consumed in time by fires ? — A. The owners would prob- ably cut it and put it on the market without much regard to its quality. Large tracts are burned over every year. Mr. Bust informed me a short time ago that out of seven camps he had in the woods last year, five of them were in burnt timber. By the President : Q. What is the character of your timber ? l r ou speak of it as pine ; is there any other growth ? — A. We make a specialty in our report of pine timber. That includes Norway. Q. You have no spruce nor hemlock ? — A. Hemlock is there, but it is of no account. We leave the hemlock and it dies very soon after a fire. It takes less fire than most any other kind of timber to kill it. The hemlock is soon gone after a fire. Nearly all the pumpkin pines have disappeared. This large lot I speak of was of that class; it is a very small pine. Q. Do you take any pains to preserve the young pine for future use? — A. No, sir. J. A. WHITTIER ET AL.j LUMBER. 963 By Commissioner Ambler : Q. When pine is taken off the land, pine does not grow again ? — A. As a rule it does not come after the fire. Mr. Ezra Bust, of Saginaw City (another member of the delegation from the Saginaw Board of Trade), said : I might, perhaps, say a little more in regard to destruction by fire than Mr. Whittier stated. In the lower peninsula of Michigan almost every township, if not every township, has settlers, and the proximity of high- ways and railroads cause destruction of the timber by fire. I do not think in the lower peninsula there is any tract of timber now standing but what is threatened with fire from settlers, railroads, and highways, and in most all parts of the State they are suffering daily from fire. Farmers are taking the precaution to clear their land adjacent to pine timber. But, without any great forest fires, there is a constant waste by these fires from the settlers, and, as stated by Mr. Whittier in regard to some camps that I had — and I presume that is the rule all over the State — I was compelled to put in five camps last year to save the timber from total destruction. There is a grub that enters the old timber and bores it through and through so that it is not marketable, and we have to follow up the fire by lumbering in order to save it. That is one of the greatest difficulties we have now. Q. Did you put those five camps on your own land? — A. Yes, sir; on my own land and that of my associates. Q. In that case, could you not check this disposition on the part of others to fire the land ? — A. No. Q. Your tract is not large enough ? — A. No, and nowhere in our State is that the case. In Canada they own these large tracts and exclude the settlers. They do not sell small tracts to parties. They reserve a township or more. In Michigan there are 16 distinct pieces of laud, of 40 acres each, in each section that any individual may buy from the government. So one buys a tract of 40 acres here and another «of 80 acres there, and no one owns large tracts exclusively of every one else. I do not know of any township in Michigan where large tracts are held by any one person. It is held by different lumbermen, by farmers, by homesteaders and pre-emptors ; they are all mixed in through the entire State inthat way. There is no township in the State that is not so situated. It is impossible to exclude the settlers and impossible to exclude any parties who set fire to the woods. We are helpless in that respect. Q. How many men do you send into each camp f — A. They vary from twenty to seventy or eighty men, just according to the amount of timber burned in that locality. Q. Then the aggregate number of men in your five camps amounted to how many"? — A. Perhaps one hundred men altogether in the five camps. They were small camps. I had one camp where there was no fire. Q. How long does this timber last before it becomes infested by the grubs after the fire? — A. If it burns along in November, it may not spoil that winter, but will stand there uutil the next May before they begin to bore; but we have to lumber it within a year after it burns. Q. Then you have about a year in which to get the lumber out ? — A. Sometimes. 1 am not so familiar with the habits of these worms, but I TARIFF COMMISSION. [J. A. WHITTIER ET AL. 964 think it is about May or June that the grabs work ; 1 don’t know but it is September ; I won’t be positive. Immediately after the timber is killed they begin, if it is in the season when they work. In winter the grubs don’t work. After they are once in the timber they do not cease until they have spoiled it. Q. As a rule, do not these fires occur after a dry spell in the summer time ? — A. In Canada and other parts of the country they have large fires, and occasionally with us we have what we call a tremendous burn- ing over a great territory, but as a rule we have the fires in the summer, when we have a dry spell 5 sometimes it is in the spring when we have a drought. Q. But those droughts usually come in the summer time? — A. Yes, sir. Q. Therefore, as a rule, you have from the early summer until the following winter? — A. We have to take it oft* the same year. Our fires are generally different from the fires in Canada. They have large fires burning over large tracts occasionally, but with us the farmers clear alongside of our timber, perhaps two or three sides of a single tract, and they build fires to burn their brush-heaps, and the fire will then crawl into our timber and destroy part of a lot on one side and some- times on another, and if we do not go to work to lumber it, it will dwindle away until we have but little left. The fires come upon us stealthily many times, and a great deal of timber is destroyed when there is no noise made about it. I didn’t have any fires last year that I considered amounted to anything, but when I came to examine last fall, I found that in five places it was burned so that I was obliged to put camps in to save it. I think that is the case generally through our country. There are fires going on slowly and steadily all the time, and the destruction is very great — much more so than people are aware of. Q. Will those grabs destroy the timber in one season, or does it re- quire two or more ? — A. Sometimes a fire will run through a tract of timber and kill a part of it outright and injure the balance so that it will die the following season ; but if it has killed a part of the timber, the grubs will begin right away to work, and of course you are obliged to cut the whole. Mr. Arthur Hill, of East Saginaw (another member of the Sagi- naw lumber delegation), next addressed the Commission, as follows : There is one part of this subject that it has been thought best I should say something upon. The present duty of $2 a thousand on lumber has the effect, in the end, of increasing the cutting capacity of our pine lands from 30 to 40 per cent., I can safely say, so that the owner of the land is benefited by that increase, and so is the country at large. To show this, it is only necessary to show the effect of the tariff on the pine that is produced from winter to winter. The tariff does not affect the price in this country of the better grades of lumber, owing entirely to the fact that in Canada the limits are first run over by men who make boards and who get logs suitable for deal. This product is made entirely for export to England, where there is always a demand for it, sometimes such a demand that in Saginaw we have made deals to send to England. As a consequence, the pines which they have left are of the coarser kinds, and it is with these grades that we have to compete in the Eastern markets. When we can put our coarser grades into the Eastern market we cut our land clean, and when .T. A. WHITTIER ET AL.] LUMBER. 965 we cannot we do not; that is all there is about it. In case we cannot cut our coarser grades profitably, the lumberman goes into the woods and simply cuts the cleaner part of the trees, and the small timber is left as food for the fires and decay. This last year that grade of lum- ber was put on our market and it did not bring $9 a thousand. There was over 350,000,000 feet, and it brought us there in Saginaw over $3,000,000. At least 35 per cent, of it was that grade of lumber, and it produced not more than $9 a thousand. The actual expense, not counting stumpage, is about $8 a thousand. That leaves us a small margin of $1 clear profit. I say the duty on lumber simply hits those grades, and we stand at a great disadvantage in Saginaw. The great- est supply of these coarser grades which goes to Albany and the East- ern markets, is derived from the Ottawa district and the Trent district. They put their Ottawa lumber into Albany for about $1.50 per thou- sand less than we do. The difference in prices between Saginaw and Buffalo always just about corresponds with the freight from the Ottawa region to Albany ; that is to say, it costs about as much to put lumber from Ottawa to Albany as from Buffalo to Albany. So that we stand at great disadvantage in case they put the prices down and still have the market. In 1875 we could not afford to produce that lumber at all. It takes a favorable combination of circumstances to make it profitable for us. We have to have a fair price for lumber and low canal and water freights. It happens at the present time that we have all three. There is a fair price on the coarser grades, and there is low freight be- tween Saginaw and Buffalo, and the consequence is we aie able to put that lumber into Albany at a less rate than we ever were before, and it simply leaves that margin which represents stumpage and to pay for labor at $1 a thousand. The estimates of the amount of pine in this country have seemed to vary with the years. It would appear now, to look over the amount of pine to cut, that there is just as much as there was seven or eight years ago. Pine-land estimaters are often taken to task on the ground that they did not give a correct estimate in times past. In Saginaw there are some tracts of land which, in 1875, they estimated to cut a certain amount from, which to-day it is estimated will cut 50 per cent, more, because it is felt that that much more can be cut provided the same favorable conditions remain ; and we hope they will. The reason is be- cause the coarse pine comes in. Since coarse lumber began to come in at a fair price a large amount of it is sent to the Eastern market to make boot and shoe boxes, and that is supplied to a great extent from Sagi- naw, where it used to be entirely left out. That uses up the property. It is not like putting it into a house, where it stands for fifty years; but it is gone, burned up and destroyed. It comes right to this point, that as long as we can put that lumber to that use we are so much better off and the country is so much better off by that amount, and we preserve our forests. If we do not, it re- mains there in the woods, and since we have been able to get the market price we have gone back to those old cuts. Much of the timber in those old cuts has been destroyed, owing to the fires and decay, and to the fact that if you leave a certain amount of pine it is only standing there ready to be destroyed by the wind, because the sustaining forces of the roots are not sufficient to stem the rush of air, and it falls down and decays. I can safely say that we lose at least 80 per cent, of the timber that we left seven or eight years ago. So that there is that much that is an actual dead loss to everything. 966 TARIFF COMMISSION. [J. A. WHITTIER ET AL. By Commissioner Porter : Question. Speaking of the estimates of the value of timber, do you believe that the estimates of Professor Sargent, in regard to pine lands especially, are reliable ? — Answer. I only know in reference to our own country. I think it is a very fair estimate of what there is. Q. You have seen that? — A. Yes. He estimates now that it would leave about 5,000,000,000 feet in Saginaw. As it becomes more scarce and valuable we cut more. We see that everywhere. His estimate was about 7,000,000,000 two years ago, and about 2,000,000,000 has been cut off since. Q. You say you have cut 2,000,000,000 since Sargent’s estimate ? — A. The estimates we made in June, 1880, of the winter of 1880-’81 and the winter of 1881-’82, were that we have cut about 2,000,000,000. By Commissioner Garland : Q. At that rate you would expect to exhaust the timber in five years? — A. We would if we cut at the present rate, but if we do not cut any more from the land than the estimate. As the timber becomes very scarce we cut everything that has two ends to it. We are doing that, as we look at it now. But in Massachusetts they will put in a piece four inches in diameter. We are not cutting as close as that. By Commissioner Porter : Q. You are familiar with Schedule K in the Bevised Statutes in refer- ence to wood ? — A. I cannot say that T am. It was suggested that I should make suggestions in regard to the revision of that schedule, but I cannot. I think a specific duty would be right. By Commissioner Garland : Q. I understood you to say that the lower grade of timber would be cut out entirely ; how can it affect the higher grades ? — A. I do not think it would affect the higher grades of lumber ; they do not compete. By Commissioner Kenner : Q. You used the word “ deal” in connection with the Canada lumber ; what is the meaning of the word “deal”? — A. There are certain kinds of plank that are cut three inches thick and not always of uniform width ; it is very clear of knots, and it is made for export. It is a class of lumber three inches thick, generally sawed to be sent to England to be there sawed to any thickness they desire. Q. It is sawed to that thickness so that it can be handled more easily on board vessels ? — A. Yes, sir. They take off the slab and leave a wany corner where the bark is left on or just scraped off. By Commissioner Oliver : Q. How does the rate of freight compare between the lumber-pro- ducing districts of Canada and the Saginaw country, say to Cleveland? You made a comparison of freight to Albany. — A. Our rates of freight are very nearly the same. Our main competition in our part of the State is at Albany, in those coarser grades, because it goes to the other cities from there for the purpose of making boxes, as I say. Q. Does Canada skip to any extent to Chicago and Milwaukee ? — A. No, sir ; there was practically none received here last year. Q. Is the lumber in Canada more easily accessible to water ?— A. Yes ; it has not been removed to any extent from the water-courses. Men usually cut their timber near streams. Q. What is the average difference between labor in Canada and J. A. WHITTIER ET AL.J LUMBER. 967 here? — A. It is about 30 per cent, there below our Michigan labor. I have taken a comparison all along the line, and I should say it is just about that. Q. I suppose in that condition of affairs, then, that labor does not leave Michigan and go to Canada ? — A. No, sir. Q. But the reverse is the case ? — A. Yes, sir ; a great many of those men come in to labor for us, and remain and make good settlers. They are hardy, industrious men, and settle down as farmers. Mr. John S. Estabrook, vice-president of the Saginaw Board of Trade (and another member of the delegation from Saginaw), said: Mr. President : There has been something said here in regard to settlers and the manner in which our State was being settled up, as a reason why we could not possibly prevent the spread of fires. On that point, perhaps, I might say one or two words. It is absolutely impos- sible for us to protect our forests from fires, as they do in Canada. I do not speak from personal knowledge, but from observation and informa- tion. In Canada, in many cases where limits are bought, if there is an accident of that kind, the government makes provision for the pur- chaser. The increase of population of the State of Michigan from 1870 to 1880 was something over 300,000. But 4£ per cent, of that was in the five southern tiers of counties which never had any pine. The balance of the increase is largely from what was fifteen years ago our best pine country; showing conclusively that the settlement follows the pine and follows it closely. In some of the counties where some of our best pineries stand to-day, the increase is over 50 per cent, since 1870. This shows that it is not in our power to prevent it, and I do not know that it is our policy to do so. I don’t know but we want the foreigners to come here. They come largely from Canada and they make good citi- zens, and I do not know that it is policy for this couutry to attempt to keep them back merely to preserve the forests. I know that the in- crease in population in certain counties, which in 1870 were the largest lumber counties in the State, has been 118 per cent, over ten years ago. I am positive of what I say, because in making up our apportionment I had occasion to investigate it very closely; the northern portion of the lower peninsula, more particularly, and that is where the great increase in population has been. By Commissioner Oliver : Question. You say that the immigrants in Michigan come largely from Canada? — Answer. A good many; not all, by any means. Our labor in our pine forests is from Canada to a considerable extent. A great many of them become farmers, but not anything like a large pro- portion of our immigration comes from Canada. A great many come from the New England States and a great many from across the water. 968 TARIFF COMMISSION. [PARKER EARLE. PARKER EARLE. Chicago, III., September 8, 1882. Mr. Parker Earle, of Cobden, 111., representing a committee of the Mississippi Valley Horticultural Society, made the following state- ment : Mr. President : I shall ask your time but a few moments, as the in- terests which we come here to present are much less iu volume and in figures which they exhibit than those which you have been listening to; but you will perhaps indulge us, in view of the fact that you, gentle- men, and all of us, consume a much greater volume of fruits during the year than you do of iron and paper, and especially of wood pulp. Our society, which I am deputed to represent here to-day, attempts to pre- sent the interests of some 15 or 16 States of the Mississippi Valley; all very productive iu fruits, vegetables, and other horticultural products. The point we call your attention to is that relating to the duty on fruits in the tariff between this country and the British Provinces. The subject came up betore our society, which has been in session here in Chicago, in the form of a resolution yesterday, moved by J. C. Plumb, of Wisconsin, and seconded by Mr. Charles W. Garfield, of Michigan, and voted unanimously, the resolution being to this effect: That it is the sense of this Mississippi Valley Horticultural Society that there should he absolute free trade in horticultural products of domestic growth between the United States and the British Possessions. And that the president and secretary of this society be requested to present this matter to the United States Tariff Commission, now in session in Chicago, and to urge the use of their influence to forward this end. Kow, we say nothing about the tariff* on foreign fruits that are im- ported. We are interested in the American tariff imposed upon fruits of Canadian production, which are imported to a considerable extent into this country, and in the Canadian tariff which is imposed upon fruits exported from this country to Canada. Of course, that question is one which is connected with this in an indirect manner. I understand, gentlemen, that the situation is this: That we were working under a reciprocity treaty for twelve years, from 1854 to 1866, that treaty being terminable by either of the governments upon notice, and that it was terminated by this government giving notice in 1866. Under that treaty the trade in all these goods between the Canadian provinces and the States was very large, and under that treaty it began to be built up, and it has continued to grow even since the imposition of duties. The wish of the Canadian provinces is to have free trade con- tinued, I am told by many gentlemen living on that side connected with the fruit trade, but the Canadian Government has imposed a heavier treaty than that which our government imposes upon the same class of fruits, somewhat, perhaps, in a spirit of retaliation against our Govern- ment. The duties on fruits average about 20 per cent, against the fruits of America. X am told that if our government should release these duties against Canadian products, it would very soon follow that the Canadian Government would release duties on their side, which would again establish free trade in these articles, and thereby result to the great convenience of all persons engaged in the production of fruit on both sides. PARKER EARLE. J FRUITS. 969 The amount of this traffic is not very heavy, it is true ; not nearly as much as it would be but for the embarrassments connected with the col- lection of duties. I have had no time to get figures, and I do not know but it would be impossible to get exact statistics of the amount which we export or import. I am told by gentlemen on South Water street, Chicago, this morning, who are importers of apples, plums, and other fruits from Canada in such seasons as favor their importation, that the amount extends to some 300 or 400 car-loads in the matter of apples some falls. There is one house on that street that imported a few years ago some 10,000 or 12,000 barrels — a pretty large item for a single house. This trade depends upon the season. When the fruits are compara- tively light on this side, we wish to import from Canada, if they have had a good fruit crop there, and it is for the welfare of our people that such importation should be as free as possible. And we are constantly exporting, from the commencement of the season in the Gulf States, the early fruits and vegetables all up through the valley of the Mississippi until they begin to ripen at home, berries, pears, peaches, apples, &c. That traffic is becoming considerable, and, as I say, this exportation will be relieved from embarrassment very soon after this government takes action to make the importation from Canada free of duty. Hence, we quote these two things as affectiug both the Canadian people and ours, and the freedom and profit of trade between the two. It is not a question of protection to anybody in this case. It is quite different from most of the interests that are presented before you. There is nobody asking for this protection and nobody is receiving it. For instance, the gentlemen in Canada who may be growing tomatoes or strawberries are not protected in their interests, because there is a duty of 40 cents a bushel on tomatoes and 2 cents a quart on strawberries, and 20 per cent, ad valorem on peaches or pears, or other American fruits, and because at the time the fruits are taken from America into Canada they have no fruits to bring into their own market. As soon as their products appear in the season our fruits seek no market there ; hence their interests are not promoted by this tariff. We do not bring apples from Canada to any extent, for we have an abundance of apples on this side of the line, and the freight charges are quite heavy and the expenses attending it, so that there is no reason why it should be done. The fruit-raisers do not feel that they are protected, but rather that the whole question is involved in embarrassments and inconveniences on account of the existence of duties on the other side. Hence, we ask your influence to procure the abolition of a system of protection which, I think, in this case, does not protect, and of the tariff which exists for revenue only, and a very small revenue, to be sure, for either government. Our own government certainly does not need it, and I presume the Canadian Government could get along very comfort- ably without it. I can see no reason why this traffic should be embar- rassed and hindered in its development for the sake of a small revenue derived on either side, where no interest is fostered by the alleged pro- tection given. There are many inconveniences attending the trade in fruits, growing- out of the imposition of these duties, whether the fruit goes toward Canada or comes here. One of the committee, Mr. Hagar, had a case to state which illustrated this statement very forcibly, but he was com- pelled to leave the city a short time ago. You will see how many in- conveniences and very serious losses are liable to result from the delays which often occur in the passage of fruits from the one country to the other, on account of the imposition of duties. In the case of Mr. Hagar 970 TARIFF COMMISSION. [PARKER EARLE. I here were two car-loads of apples sent to his house in Chicago at a time when they were quite valuable two years ago, and they were de- layed twenty or thirty days in Detroit because some one in the custom- house there supposed that the valuation (it was an ad valorem duty) was too small, and no means were taken to correct this valuation until nearly a month had elapsed. By Commissioner Kenner : Question. And the apples were all rotten? — Answer. In this case they were not all rotten, though they might have been under other cir- cumstances. But a penalty of $100 was exacted by some official of the custom-house there before the apples could be forwarded. Q. Your general idea is that fruits of all kinds in a natural state should be on the free list? — A. That is our wish. Fruits, vegetables, plants, nursery trees — our resolution embraces all horticultural prod- ucts. By the President : Q. As applied to Canada only? — A. Yes; I am not undertaking to talk about tropical fruits. Commissioner Kenner. Tropical fruits are produced in the South, and they ought to come in just the same. The Witness. Personally, I agree with you, but our committee were instructed only to represent the particular interest which concerns do- mestic-fruit growers. OTTO YOUNG.] WATCHES. 971 # OTTO YOUNG. Chicago, III., September 8, 1882. Mr. Otto Young, wholesale jeweler, representing the Chicago Jew- elers Association, submitted the following statement: Gentlemen of the Tariff Commission : The committee before you, consisting of Otto Young, N. Matson, Benj. Allen, and H. F. Hahn, appointed at the regular monthly meeting, Sep- tember 5, 1882, to represent the Chicago Jewelers’ Association, whose membership embraces the leading jobbers, importers, and manufacturers of watches, jewelry, watch materials, &c., of the Northwest, beg leave to submit the following views and statements for your consideration. It is their belief that the dut^now levied upon watches, watch move- ments, and cases is too low, and they respectfully ask that you will rec- ommend an increase of duty upon those manufactures to 40 per cent, ad valorem, for the following reasons : The foreign production of these goods sent to this country is mostly of the poorest quality, and being manufactured by the cheapest of labor, at rates of wages far below those paid for similar labor in this country, and entirely insufficient to enable American workmen to support their fam- ilies and to educate their children and rear them in a proper manner to enable them to become intelligent and self-respecting citizens. We are desirous of protecting his interests, and wish to encourage the invest- ment of capital in these branches of industry, in order that establish- ments now existing may be strengthened and the several industries extended in our country. The su£>erior quality of the American watches fully justifies us in mak- ing this appeal in behalf of this class of skilled labor and capitalists who have invested their means in these branches of industry. The history of American watch manufacturers shows that of all the companies established but few are in existence to-day, and that there are but one or two which have paid anything as earnings to the original stockholders. Many of these companies have been sold out, or changed hands repeatedly, so that it is only by the constant use of highly-im- proved mechanism- and a very large production which has enabled any establishment to exist. Fully nine-tenths of the cost of a watch is expended in labor, and at the present time we estimate the number of artisans employed in this industry in the neighborhood of 12,000. We ask that the duty of 10 cents upon watch jewels unset be removed, and that they be put upon the free list. Inquiries at the ports of entry will show that the watch factories are paying almost, if not all, the amount of duties collected upon watch jewels. On account of the small size of each, the unprincipled importer is able to smuggle them in and successfully evade the payment of duties. The amount of watch jewels imported into the United States varies from $100,000 to $150,000 per annum. We ask that the duty upon watch-dial enamel be removed ; that it be put upon the free list, as there is no industry in the United States whose interest it will affect. lTie secret of enamel-making is unknown in this country, and although attempts have been made to manufacture it by persons having worked it successfully in other countries, yet all 972 TARIFF COMMISSION. [OTTO YOUNG. attempts so far have failed. By a decision of the Secretary of the Treasury the tariff imposed is 40 per cent., whereas we believe it should properly be classed under the list of gl^s, old or broken, in pieces, which cannot be cut for use and fit only to be remanufactured free : this truly represents the condition of enamel received in this country, i. e., broken and only fit to be remanufactured. The amount imported during the year does not exceed $15,000. We might here direct your attention to the inequality existing between enamel in the crude, entered at 40 per cent., while dials made of it on sheets of copper, whose tariff is 45 per cent., come through completed at but 25 per cent., thereby burdening the factories with this additional amount. As importers and dealers in watches and all materials connected with the watch industry, we are interested above all things in maintaining a steady condition of healthy and permanent prosperity, and in prevent- ing financial panics, which carry ruin to business men and manufacturers alike, and bring dire distress to the laboring classes. To realize this beneficent end we believe the statesmen of the country will find no agency more potential than by adopting wise measures to strengthen every branch of manufacturing industry now established, and to create and build up every new industry that can be naturalized and built up in our country. OTTO YOUNG, Chairman. N. MATSON. BENJ. ALLEK H. E. HAHN. By the President : Question. Your firm are purchasers of watches? — Answer. We are jobbers and importers of watches. We import Swiss watches, and are jobbers of American watches. We prefer to push American goods, not because there is any difference in the profits we can make upon them, but American watches are much more satisfactory to handle. In get ting our goods from Europe they may not give satisfaction at all, and we do not know half the time what we are getting. American manu- facturers are making some styles of watches to-day in order to compete with Swiss goods, in which they are actually losing money ; and we think that interest should be more protected than it is, especially as nine-tenths of the intrinsic value of a watch movement is labor. In Switzerland they have children from ten to twelve years of age at work on watch materials, instead of keeping them at school. That is not the case in this country, where so many parts of the watch are made by machinery. Whole families in Germany work in the watch business at home from ten to fourteen hours a day. We do not wish our laborers here to be obliged to do anything of that kind, and therefore we ask this increase in the tariff. JOHN G. WILSON.] IMMEDIATE TRANSPORTATION. 973 4 JOHN G. WILSON. Chicago, III., September 8, 1882. Mr. John G. Wilson, of the firm of G. W. Sheldon & Co., custom- house brokers, Chicago, appeared before the committee and made the fol- lowing statement : At the request of many of the importers of this city, whom I have the honor to represent, I beg to submit the following suggestions, looking to the enlargement and simplification of the statutes governing what is known as “immediate transportation” — a subject which lies at the bot- tom and is the very life-blood of all importation at ports of entry other than those on the sea-coast. 1. It is suggested that section 2 of the act of Congress of June 10, 1880, be so amended as to not require an entry of merchandise to be made at the port of first arrival on goods destined for interior ports. 2. It is suggested that section 9 of the act of Congress of June 10, 1880, be so amended as to allow the privileges of immediate transporta- tion at any time within thirty days after merchandise shall have been landed, instead of within ten, as is now the law. 3. ‘ It is suggested that section 1 of the act of June 10, 1880, be amended so as to confer the privilege of immediate transportation on articles “in bulk,” now excluded by the terms of the said section. A bill (H. E. 5976) was introduced in the last session of Congress looking to this reform, but failed to receive attention. I would like to add that the reason for bringing this question before this Commission is that in the reports that were telegraphed in regard to its meeting at Long Branch there was a very severe attack made on immediate transportation by a New York merchant. I know nothing of that gentleman, of course; he may be of the highest reputation and very sincere, but I do not hesitate to say that nine times out of ten such a cry is one of dishonesty. The attempt to concentrate all that busi- ness at New York is what they are alter, and thereby to afford oppor- tunities for fraud. We have had a long and bitter fight out here for immediate transportation, and we do not like to see any attacks on it. We are sure the various ports of entry like Milwaukee, Chicago, and Cincinnati afford standards of comparison by which the government can see that its duties are being collected properly. We have our sample office here in the appraiser’s store, and if goods are brought in at a lower value here than in New York, the samples can be compared and the value arrived at. The wituess then submitted and read the following communication: Chicago, September 8 , 1882. Hon. John L. Hayes, Chairman Tariff Commission : Sir: At the request of many of the importers of this city, whom I have the honor to represent, I beg to submit the following suggestions looking to the simplification of the statutes governing the recovery of duties alleged to have been erroneously exacted. TARIFF COMMISSION [JOHN G. WILSON. 974 It is suggested tliat section 2931 of the Revised Statutes of June 22, 1874, he so amended that a protest addressed to the collector at any time within thirty days after the liquidation of duties shall he sufficient to protect the rights of the importer and to give him standing in the courts, if the collector or the Secretary of the Treasury shall decide that in their opinion the protest is groundless ; and that after such decis- ion a single test suit brought in the courts shall be sufficient to decide the merits of any question involved. I have the honor to remain, sir, very respectfully, JOHN G. WILSON. WELLINGTON SMITH ET AL.] PAPER. 975 WELLINGTON SMITH ET AL. Chicago, III., September 8, 1882. The first business of the day was devoted to the consideration of the paper interest, and there were present as representatives of that in- dustry Mr. Wellington Smith, of the Lee Paper Manufactory, of Lee, Mass., J. A. French, of Three Rivers, Mich., Hon. W. H. Stowell, of Appleton, Wis., and Mr. 0. O. Chapin, of Springfield, Mass. Mr. Wellington Smith, being introduced, spoke as follows: Gentlemen: We have in this country an association called the American Paper Makers’ Association, which had its annual meeting at Saratoga in the latter part of July. At that meeting it was thought best to appoint a committee to represent that industry before this com- mission in order that you might have information regarding our in- dustry, what had been accomplished, and its present condition. We do not appear before you asking for any favors or any changes in the tariff. We simply wish to show what has been accomplished under the present tariff, the country’s, growth, development of business, and the reduction of the price of paper. The first thing I would like is to have our secretary, Mr. Chapin, of Springfield, read a written report which he has. Mr. C. O. Chapin, of Springfield, Mass., was here introduced to the commission and read the following paper : In the schedule of the present tariff, paper is divided into four gen- eral classes, each of which is charged with a different rate of duty, viz : Sheathing paper, 10 per cent, ad valorem ; printing paper, unsized, used for books and newspapers exclusively, 20 per cent, ad valorem; all paper sized or glued, suitable, only for printing i>aper, 25 per cent, ad va- lorem ; all paper n. o. p., including writing paper, 35 percent, ad valorem. The average rate of duty on all dutiable imports for the past fifteen years has been nearly 45 per cent, or times that on unsized print paper; or a percentage of duty 125 per cent, greater than that charged on unsized printing x>aper, 80 per cent, greater than on sized or glued printing paper, and 30 per cent, greater than on all other paper and manufact- ures of paper, including writing paper, &c. The law as it stands there- fore seems to make an unfair discrimination against the manufacture of paper, which, from being one of the best-protected industries through all the changes in the tariff from 1824 to 1846 (during which term of years printing paper bore a duty of 10 cents per pound and writing paper a duty of 15 cents to 17 cents per pound), has become one of the least protected of all of the great industries of the country. The cost of plant necessary for making paper and the capital necessary for carry- ing on the business are greater in proportion to the value of the product than in most kinds of manufactures. In the building of a paper mill large quantities of heavy timber, of lumber, of brick, cement, and lime, are necessary, as the machinery is ponderous and powerful, requiring heavy foundations and settings, and even then the buildings and machinery require renewal every ten to fifteen years. The machinery in its construction calls for great outlay for iron, steel, brass, and copper. All these materials are u protected.” The following table, made up from the census reports of 1870, shows comparative facts in regard to capital and value of products of some of our leading industries. •976 TARIFF COMMISSION. [WELLINGTON SMITH ET AL. This list could be largely extended, but it is sufficient to show the disadvantages in this regard, appertaining to the paper manufacture as compared with other branches of manufacture. In manufacturing, motive power, whether derived from steam or water, is an important item, aud the production capacity per horse power em- ployed in the different kinds of industry becomes of interest. The value of product per horse-power employed is less in paper making than in most of our industries of equal importance, as per census reports for 1870. The following is the product per each horse-power employed in the industries stated : Leather $3, 972 Iron 1, 530 Cotton goods 1,210 Woolen goods 1,777 Food preparation 1, 020 Steam engines and boilers 3, 596 Furniture 2, 665 Cotton and woolen machinery 2, 246 Paper 928 In view of such a presentation of facts, it is difficult to account for the slight protection granted to the paper industry as compared with other home manufactures which require less capital and power for a given value of product, and which consume a smaller amount of the products of protected home industries and of dutiable imported mate rials. Having seen how American paper-making stands related in the mat- ter of protection to home industries in general, it is pertinent to inquire what are the facts in regard to its relations to foreign competition in its own particular product. The following is a list of articles largely used in the manufacture of paper, many of which are imported, and all of which are subject to duty, viz : Alum and aluminous coke, 60 cents per 100 pounds, or equal to 35 to 48 per cent. Aniline colors, 50 cents per pound and 35 per cent, ad valorem. Caustic soda, 1J cents per pound, or equals 35 to 50 per cent, ad valo- rem. Sal soda, \ cent per pound, or equal to 15 to 25 per cent, ad valorem. Soda ash, ^ cent per pound, or equal to 10 to 30 per cent, ad valorem. Bituminous coal, 75 cents per ton, or equal to 25 to 40 per cent, ad valorem. Canvas (cotton), 40 to 50 per cent, ad valorem. Glue, 20 per cent, ad valorem. Starch, 1 cent per pound and 20 per cent., or equal to 40 to 50 per cent., ad valorem. Rosin, 20 per cent, ad valorem. Wires, 35 per cent, ad valorem. Felts, 67 per cent, ad valorem. Lime, 10 per cent, ad valorem. Oil, 35 to 40 per cent, ad valorem. Terra alba, 20 per cent, ad valorem. Clay, $5 per ton. Boards, $1 to $2 per M. All iron, steel, brass, copper, and other metals used in making or re- pairing machinery or buildings. WELLINGTON SMITH ET AL.] PAPER. 977 It is estimated that paper-mills can be built in Europe at one-half the cost of similar establishments in this country. In the matter of labor we pay our mill hands from 200 to 300 per cent, more wages per hand than is paid abroad for the same sort of labor. A prominent paper manufacturer of Great Britain said that if he paid the wages which our paper manufacturers did he could make no money. In a mill in France, where a comparison of wages was made with those paid here, it was found that 3 francs, or 60 cents per day, was the com- mon price for the average workman. The cost of labor here is from 20 to 40 per cent, of the cost of the manufactured article. The cost of freight on paper to seaport markets from the mills in this country is frequently much greater than the freight would be from Europe to the same ports. The rates of interest here are from 50 to 75 per cent, higher than in Europe, and interest is no insignificant item in the pros- ecution of paper manufacturing. It is sometimes said that rags being free of duty, paper should therefore be admitted at a low rate of duty. It is true that rags are admitted into this country, as into all other countries, free of duty, but many countries from which we bring them charge an export duty which is more than an equivalent to any reason- able import duty. Germany is considering the expediency of prohibit- ing the exportation of rags, and Turkey has virtually prohibited it. The export duty on rags from Italy, from whence comes a large proportion of rags used in the manufacture of writing paper, is so great that it amounts to over one cent per pound on every pound of paper made from them. No other equally important imported article is charged with an export duty. The raw material for many other large industries is im- ported free. Hides, and tanners’ crude materials for converting them into leather, are free ; so are India rubber, gutta-percha, cotton, plum- bago, argols, tin, raw silk, soap stock, &c. The manufactured products of these free materials are protected by a much higher average rate of duty than paper. Imported leather goods are charged with a duty of from 25 to 50 per cent., rubber goods from 30 to 60 per cent., plumbago goods from 50 to 60 per cent., soap 47 per cent., products of argols from 10 to 40 per cent., manufactures of tin 20 to 35 per cent., manufactures of silk 30 to 60 per cent. It will be seen, therefore, that other home industries with raw materi- als free are treated with greater consideration in making up our tariff than the paper industry. Some of the European countries escaped these export duties by reciprocity treaties, and all have the advantage of cheaper freight from countries exporting rags. No demand for a reduction in the tariff on paper has been made for years save by a few newspaper publishers who, taking advantage of an exceptional condition of the market in the fall of 1879, for which con- dition the paper manufacturers were in no way responsible, clamored for free printing paper. As the duty on paper suitable for their use was but 20 per cent., an easy way out of their temporary troubles would have been to import paper. But the imports of printing paper for the year ending June 30, 1880 (which time covered the rise and fall of the boom), were but $75,936, dropping to $55,329 for the year ending June 30, 1881, and to-day, taking quality into consideration, news paper is but a shade higher in this country than the average European price, and the average standard of quality is much higherin this country than in Europe. The above shows that home competition will insure reasonable prices for home consumption, and that the outcry against paper-makers was un- just and uncalled for. Had the newspaj>ers had their way they would now be paying higher prices for their paper, as the building of mills H. Mis. 6 62 978 TARIFF COMMISSION. [WELLINGTON 6MI1H ET AL. would have ceased and the trade been generally demoralized from threatened imports of foreign surplus papers. During the agitation of the question of the repeal or reduction of the duty on paper, agents of foreign manufacturers were offering their goods here at less than their prices to home customers. A small surplus of paper thrown upon the market is sufficient to break prices to a greater degree than is possible with most other manufactured goods. The consumption of paper cannot be forced by small reduction of price, as is the case with many other goods. No newspaper-publisher will print 12,000 copies of his paper if his subscription-list is but 10,000, simply because his printing paper costs him one- half cent or 1 cent per pound less. No book-publisher will publish an edition of 5,000 copies of any book when 3,000 copies is all the market will take, because paper is 1 cent lower in price. No person, because he can buy five sheets of note paper for a cent instead of four sheets for a cent, will increase his correspondence 25 per cent. While the imports of printing paper which bears the lowest rate of duty have decreased, the importation of writing papers bearing the highest rate of duty have increased. The imports of writing paper have increased from $8,944 in 1877 to $40,778 in 1881 — over 4£ times. These imported writing papers are mostly if not entirely of a high grade of paper — fancy note papers, &c., which are in the nature of luxuries. If the duty were even higher, there would still be a demand for them and if the duty were reduced the sale of them would scarcely be increased. Steadiness in prices is desired by the manufacturer and his customers but this can never be assured when frequent changes are made in legis- lation affecting the manufacturer, or when such changes are impending. No stability to trade and manufacture can be looked for when the mar- ket is liable to be disturbed by an influx of foreign goods imported at a low valuation and a low rate of duty. Recognizing the desirability of steadiness and stability, the paper- manufacturers of this country are content to abide by the tariff* as it is, rather than unsettle the business by asking for any increase of duty to make them on a par with other industries; and at the same time they are confident that home competition will continue to furnish all the paper demanded here at reasonable prices. They believe that the best interests of the country, so far as their industry is concerned, affecting both the manufacturer and his customers, will be best served by pre- serving the present rates of duty. I have a letter here, which I will read, from a practical paper-maker who has been abroad, and who was bred in the business. He is now treasurer and general agent of a large paper-manufacturing association in Massachusetts, which manufactures 15 tons of paper per day. [Treasurer’s office, Montague Paper Company, George E. Marshall, treasurer.] Turner’s Falls, Mass., September 4, 1882. Dear Sir: I regret very much that I was out of town when you visited our mills last Saturday. I visited some of the largest mills in England this summer, and could not fail to observe many advantages the English paper-manufacturer has over the American. In one very large mill, running twelve machines, their coal costs but C«., or about $1.50 per ton. Our coal costs nearly four times as much. The tine Leemore clays which costs the American manufacturer $26 to $23 per ton, are laid down at the mills in England at about $8.50 per ton. And I will here remark that English papers contain double the amount of clay found in American papers. All chemicals used in the manufacture of papers are cheaper in England than here. The regular pay of machine-tenders is $8 to $9 per week, while here we pay from $15 to $20 per week. WELLINGTON SMITH ET AL.] PAPER. 1)79 In the English paper-mills I saw girls filling the boilers with stock, and tending the stock-cutting, and cleaning machinery — considered in this country to be the most dis- agreeable and unhealthy work about the mill and always performed by men; theso girls received 10s., or .$2.40, per week for doing the work that we pay men $9 to $10 per week. I saw girls assisting about the rag-engines, doing the work that we employ men to do, the girls working in the rag room and finishing rooms receiving about $2.50 per week for doing the work that we pay from $5 tp $7 per week. Notwithstanding allth is the publishers of newspapers and books in England pay nearly or quite as much for their paper as American publishers using a similar quality of paper. The publishers of the large daily papers of England pay about 5-£ cents per pound for their paper, and sell their papers at Id., or 2 cents per copy. Here the publishers of the largest daily papers are paying from 5f to 6£ cents per pound for their paper, and sell at from 3 to 5 cents per copy. As there are from eight to ten copies in a pound of the printing paper used, the publishers here charge the dear people who buy their printed wares from 8 to 24 cents more per pound of printed paper than the English publishers charge. Yours truly, GEO. E. MARSHALL. C. O. Chapin, Esq., Chicago , III. A manufacturer of Great Britain was dining with me less than two years ago, and I referred to this matter of labor and said to him, “ We have had a man in our employ who learned his trade in your mill — a machine- tender. He has now gone from us and has charge of a department in one of the mills at Holyoke.” He said beknew him. I said, u What did you pay him, he being a first-class workman?” He said: “ We paid him $7 a week, aud if the out-put of the machine was so much more than the regular stint, he could earn a half dollar a week more, or $7.50 a week, which was the extent.” Said I, u Our regular pay to this man was $3.50 per day or $21 per week.” And further, I said, “ What sized house do suph men as he have with you?” He said, “We house our employes well,” and naming the man he said: “He would have a house that had three rooms and a closet.” Said I, u The man had with us a house containing a parlor, bed-room, sitting-room, dining-room, kitchen, a back kitchen, a cellar under all but the back kitchen, and three good chambers, closets and buttery, and a good big garden plat.” ne said, u If we paid him that much we would not make any money at all.” In regard to the French prices, I sent a young man to France a year or more ago to put up an apparatus, in which I am interested, in a mill in France, and the report which he made is that the wages there paid are three francs or GO cents a day. That I know is correct. In regard to coal, I will say that Mr. Marshall’s statement is true, be- cause I know that in our own case, perhaps forty miles from him, our coal costs us $6 a ton, and the coal which Mr. Smith uses costs $6 a ton. Saying nothing about his using steam made from coal for power, it would make a difference of $18,000 a year just on one item. The present law has too much verbiage in its specifications. It speci- fies numbers of sizes of paper rather than qualities, as, for instance, it says, the duty on paper, on demy paper, antiquarian, imperial, and royal, and specifies the numbers of papers as though they were the kind of paper rather than sizes of the same quality. If, in making up a new tariff, this should happen to occur to you, you might cut off a good many of these things, which simply lumber up the present tariff law and con- fuse it. By Commissioner Oliver : Question. Could you not make a recommendation of changes in the verbiage which you think would be desirable ? — Answer. Yes, sir; I can do that more at my leisure. I might take the present tariff and strike out some of those things. Q In your statement you named certain materials used in paper-mak- ing and the rates of duty charged on them. Can you state what propor- 980 TARIFF COMMISSION. [WELLINGTON SMITH ET AL. tion of the cost of paper these articles would be? — A. The percentage of the use of those various items varies with the kind of paper made. Q. I mean an average. — A. For instance, take caustic soda or soda-ash — those who make the cheaper grades of paper use the stronger chemicals much more than the makers of fine paper. There is no average, be- cause hardly any two mills make exactly the same kind of paper. I can give you the percentage of my own mill which makes a fine writing paper, and we do not use so much chemicals there as are used in the paper made by my friend Smith. Q. Take any print paper, for instance, what proportion would these materials that are imported bear to the cost? — A. I do not make that grade of paper, and have never made it a particular study. I do not know whether the other members of the committee moke that paper and would be able to tell, or not. Mr. Wellington Smith. From one-half cent to one cent per pound. Commissioner Oliver. The idea is, whether, if these articles are put upon the free list, you could stand the reduction in duty. Mr. Chapin. My idea about the duty is this: At certain times there is a surplus of paper made, and we want to keep that surplus from coming in to disturb our market and unsettle prices, and demoralize things generally. It takes, as I remarked, but a very small percentage of surplus to put down the prices of the entire product of any industry. If, for instance, there is made in Holyoke 100 tons of fine paper per day, and the normal demand takes that amount, with the exception of, per- haps, one or two months in the year, and during those one or two months paper accumulates in the hands of the manufacturers, when the busy season comes they get rid of it. Now, if there should be thrown upon the market, instead of 100 tons per day, 105 tons per day, the price would be reduced on the whole output, so that the manufact- urers would not get as much for the 105 tons as they would for 90 tons if the market had been kept in its normal condition. The overproduc- tion depreciates the price to a very much greater extent than the per centage of surplus. By Mr. Oliver : Q. What is the price of print paper? — A. The price of common news- paper, as Mr. Marshall states, is 5f, or 54 to cents; and the price in Europe, he said, was 5J, I think. By Commissioner McMahon: Q. Can you tell me the reason why sized paper should be 5 per cent, more than unsized paper, used in the manufacture of books and papers ? — A. Sized paper requires more labor to finish it. Q. Do they ever size paper in this country that has been imported unsized. — A. I have never known it to be done. Q. Is it a fact that it is often difficult to determine whether a paper is sized or not ? — A. No, sir ; I don’t think it is very difficult, generally speaking. It certainly is not in the highest sized paper. Q. I am speaking of printing paper only. We have had papers im- ported into New York that were claimed by the importers to be un- sized, but which, on the part of the government, were claimed to be sized? — A. I suppose an analysis would show it at any rate. By Commissioner Kenner: Q. You mention the expense of the paper establishment, and you gave an interesting account of the difference in prices between here and Europe. I would like to have you state what proporton of that ex- pense is labor f — A. 1 stated from 20 to 40 per cent, (according to the kind of paper) is labor. WELLINGTON SMITH ET AL.] PAPER. 981 Q. Do you mean that, in manufacturing paper, from 20 to 40 per cent, of your output goes into the hands of the workmen? — A. From 20 to 40 per cent, of the cost of paper goes to the laborer. Q. You mention, also, the cost of the plant of a paper establishment, and you drew a comparison between that industry and various other industries in the country. You mentioned the buildings, the materials of which they were made, the foundations of the machinery, which had to be heavy, as the machinery was ponderous. In making your estimates of the value of other leading products, did you include the same material and the same items as in your statement of the cost of the plant of a paper establishment? — A. The buildings for other establishments require, of course, timber, brick, and all that, but not to the same extent as in paper establishments. The foundations for our paper-engines have to be heavy, and the machines have to be very strong. The timbers in the buildings are very heavy. I also stated that, heavy and expensive as they were, they had to be renewed every ten or fifteen years. Not so with the buildings for the manufacture of woolens and the like. Q. I want to get at the fact whether, in making up the estimate of the cost of the plant of other leading manufactures, you included the build- ings and machinery as well as in your own ? — A. The table which I made up was taken from the census reports, which stated the amount of capital invested. Q. Was your own also taken from the census returns, or did you not put in your own estimate of the buildings ? — A . I j ust took all the returns I read from the census reports. Q. Your own also? — A. My own included. Q. They are all, then, on the same footing? — A. Yes, sir; I took a few from Evans’s publication, and some of the others from a book issued by the go vernm ent — Heyl’s Digest. Those two books don’t agree exactly in their statements, but the discrepancy is accounted for in this way: In Heyl, he takes certain kinds of paper and classes them together, while in Evans they are classed in a different way; but taking them all together they would probably foot up about the same. I took them all from official sources. Q. Your statistics came from the same sources in drawing your com- parison? — A. Oh, yes, sir; certainly. By the President : Q. As I understand you, your idea is that one of the most important things in connection with your industry is to be relieved against the surplus you mentioned? — A. Yes, sir; as a general thing we can com- mand the market in this country. Mr. Wellington Smith, again addressing the Commission, spoke as follows : Our secretary has given us the main facts in relation to this matter in a way that I think you can understand, but I wish to refer to the dif- ference in prices of paper, which has been alluded to by one of the Com- mission. You all know that in this country if there is any money in any business, it is not a great while before others get into it. The result has been that there has been a large increase in the growth of all our industries, paper included. I have here a table showing the daily capac- ity of the paper mills of the United States, as reported by the manufact- urers for insertion in the seventh edition of Lockwood’s Directory of the Paper Trade for 1881. This gives it by States, showing that the total production of paper is about 2,000 tons per day. 982 TARIFF COMMISSION [WELLINGTON SMITH ET AL- Table showing the daily capacity in pounds of the paper mills of the United Slates now run- ning, as reported hy the manufacturers for insertion in the seventh edition of Lockwood's Directory of the Paper Trade , 1881 (a). [Submitted to the third annual convention of the American Paper Makers’ Association, by Howard Lockwood, publisher Paper Trade Journal. 1 States. Binders’ board. it) .9 o <0 t? ® a o o M Building, roofing, sheathing. cS O Chemical fiber (c). Collar. Colored (d). 1, 000 12, 500 1,000 90, 700 47, 000 3, 000 7, 900 24, 000 32, 000 2, 000 1,500 32, 000 86, 000 44, 500 289, 200 46, 400 7, 000 30, 300 1,500 3, 000 1, 000 6, 000 2,000 23, 300 500 12, 090 6,000 3, 000 1, 500 10, 500 8, 000 2, 000 34, 000 2, 000 3, 000 Massachusetts 6, 000 18, 500 30, 000 5,500 23, 50l 4, OOv Minnesota Missouri Nebraska 10, 000 52, 800 8, 500 202, 900 5,100 108, 500 500 191, 400 2, 000 200 9,250 200 28, 000 2, 500 2, 000 39, 500 New Hampshire .... 1,000 ' 49,320 1,500 2, 000 1, 500 4, 000 70, 000 1, 400 I 6, 80C 8, 700 1, 100 16, 000 New J ersey ......... 6, 000 5, 500 1,500 3, 000 New York .... 8, 000 North Carolina, Ohio 6, 000 2, 000 37, 300 Oregon Pennsylvania 32, 000 31, 000 6, 000 2, 000 47, 000 1, 500 Rhode Island South Carolina Tennessee 1, 000 Utah Vermont ...... 4, 000 3, 000 22, 500 ; Virginia 1,000 West Virginia . . . 1, 500 1 Wisconsin ;;;;;;;; 30, 000 2, 000 Totals 124,120 11,500 |l, 390, 050 153,800 41, 000 199, 500 14, 000 111,900 States. £ § d 1 jfi 1 & CS © t during the riots. In that case they were simply treated as if they had been warehoused at New York or Philadelphia. The re- sult would have been the same. The government does not require the duties in such a case, where the loss can be proved. There are also damages allowed here now, and our western importer receives the benefit of the damages that occur between New York and Chicago ; but the amount of that is only a few hundred dollars in a 1014 TARIFF COMMISSION. | JOHN HITT. whole year. Our goods seem to get here in pretty good order, accord- ing to the return of the appraiser. I was asked one question to-day by Commissioner McMahon — whether I ever knew any considerable line of goods being received here, the duties upon them collected here, and then the goods being placed upon a car and sent back to New York and sold at a profit ; which, I suppose, is one form of saying that the duties were not collected properly here, and that the appraiser probably did not know enough to detect it. The appraiser is a very honest gentleman, and very capable. We have had the same appraiser here for ten years. He is a very careful man, to the extent of his knowledge, and will do the very best he can. There was one importerof cloths here who paid probably $80,000 duty. Hegotalong pretty well for a year, and then we found that he had commenced ship- ping goods to New York and San Francisco to sell just as fast as he paid duties here. lie was duly watched, and in the course of two or three weeks he was in the county jail. If all the undervaluing men were put there, I think some, of your jails in the East would be pretty full. This man, we found, had been committing frauds upon the government, and had not paid for some months. We ascertained the facts, but even then were unable to make good our charge of undervaluation. Ordi- narily 1 think we have collected the duties very well. Q. It has been stated that on account of the interior ports not hav- ing appraisers for each department — not having expert appraisers, you might term them — goods are brought in at a lower valuation. — A. That is very plausible on its face; but we have our appraiser here who has been in office nearly ten years, as I say, and was a man of very decided ability when he went there. The first assistant has been nearly eight years in office, and the third assistant has probably only had about three years 7 experience. While we will not claim anything but a good fair average, it is to be recollected that they send samples of their goods to New York, Boston, and Philadelphia cons' antly, every week, and thus have the benefit of the experience of the Eastern offices. It takes only a little over 24 hours 7 ' time now to send them' there. Q. Is it the law, or does a regulation of the Treasury Department re- quire them to send, samples of goods; or is it merely the custom ? — A. It is just the custom. This opportunity of having the benefit of the ex- perience of the Eastern appraisers is of great importance, and Mr. Ham indulges in it very freely indeed. He holds goods here for weeks in order to get returns from Eastern appraisers, and there is no reason why he should not have the benefit of their experience inside of a week, upon any line of goods. And for that reason I wish to say it is not so wonder- ful that there should be a very fair appraiser’s office here. It is so strict an office that we have a great number of importers here who do not im- port a dollar’s worth of goods into Chicago, they tell us because they can make better terms at the Eastern offices; they say our appraiser is too rigid, especially on damages. I could uame three or lour leading houses that pay perhaps over half a million dollars in New York on account of not being able to secure proper damages here under the law, as they say, because the views of our appraiser here are very rigid in regard to that, while in New York they have experience, and allow much more liberal damages. I intimate no impropriety at the New York office; but it is simply the fact that all that business has been closed up here on account of the appraiser’s strictness. All kinds of silks, silk ribbons, &c., have been closed up a number of years ago. They do not come here any more, as stated by Mr. Field. THADDEUS DEAN ET AL. ] LUMBER. 1015 THADDEUS DEAN ET AL. Chicago, III., September 9, 1882. Mr. Thaddeus Dean, of Chicago, dealer in lumber, addressed the Commission as follows: I am not a manufacturer, and that is what brings me here to-day. I have no special interest to represent, and I might say that at this moment I am in the philanthropy business, which does not pay directly. The manufacturers had a meeting before you day before yesterday. Unfortunately I had not the pleasure of being present, and a report, which I presume to be a correct one, published in the Inter-Ocean yes- terday, has been placed in my hands, which I have looked over within the limited time I have had. In that I see nothing to change the opinion that I have entertained for some years — not the opinion of the free-trader generally, for I have never been accused of being a free-trader ; but as applied to the lumber question, I am most decidedly a free- trader. I think there is no reason under God’s heavens why the duty of $2 should be placed upon lumber from the Dominion of Canada. I can see many reasons why there should be no duty. As claimed by the manufacturers who appeared before you the other day, there appears to be now standing in the States of Michigan and Wisconsin a stock of logs or stumpage that will last, say, about ten years. I think that agrees with the general estimates that are made. It would seem somewhat alarming if we are to be deprived of lumber ten years hence, and I think it would be in the line of prudence to draw from other sources, if we have them at command. That argu- ment has been used before. The committee that were before you yes- terday have already suggested that it might be well, if we are so rapidly getting out of stock, to draw our supplies from our neighbors for awhile, and to impoverish them rather than ourselves. Now there is a good deal of argument in that. If we had but ten years’ supply of provisions on hand, we would be lookmg out for something for our children to eat in the years to follow that. I am not, however, in full sympathy with the idea that there is but ten years’ supply of lumber on hand ; still, there is a good deal of force in it. The stock is growing rapidly less, that is very evident, and these trees that do stand are fast being ac- quired by a very few men. I think it is estimated that something like one hundred men now own a large majority of the trees standing upon our soil. Their power is getting to be a little dangerous, as it appears to me, and as it would appear by the rapid advance of stumpage. I can remember when I first went into the lumber business in this city some fifteen years ago, that stumpage was generally estimated at 50 cents a thousand, and that paid the large stump owner considerable of a profit. His land only cost him from $1.25 to $2.50 an acre, and I da not think that, under those circumstances, he is entitled to too much consideration. He has a good profit even at 50 cents a thousand stump- age. But if the stumpage of the Northwest is gradually gathered into a few hands, they have the power to form combinations and under- standings that have the effect to bull up the price of lumber. The operations of these manufacturers, who all appear to run in one groove, have been advancing the price of lumber the last two or three years out of proportion to former years. 1016 TARIFF COMMISSION. [THADDEUS DEAN ET AD. I took occasion last evening to gather from my books some statistics of the cost of lumber for the last ten of fifteen years, and I have it ac- curately extended. I have been a lumber buyer in this market, and have probably bought during that time not less than 10,000,000 feet of lumber, and from that to 25,000,000. There are other dealers here who are similarly situated. You will understand that Chicago does a busi- ness exceeding 2,000,000,000 per year, making it by far the largest market on the globe for the sale of lumber, and over one-half of the gentlemen doing business here do not own a single acre of stumpage. They buy from the manufacturers and stump owners that appeared before you daj before yesterday. I notice that prior to the fire, up to October 9, 1871, lor that year lumber had cost me — and my neighbors as well, for we buy side by side — $14.46 per thousand feet. I notice in the estimate of the Saginaw gentlemen they figure the absolute cost of lumber at $13.50 to the manufacturer. As the transportation from Saginaw here is some- times $2 or $3 per thousand — 1 have paid as high $4 — you will see that they have been doing business at a tremendous loss, 1 fear, and that is the reason they are so wealthy now, I presume. The great fire in Chicago necessarily had an effect upon the value of lumber. It had the more effect because lumber was not one of those items upon which a rebate was allowed. You will remember that when the world was weeping for our impoverished condition after the fire Con- gress passed a law giving us a rebate upon glass, iron, and everything else in the way of building materials in order to facilitate the rebuilding of Chicago. The lumber interest, however, would not submit to that rebate, and this is the effect of it : Lumber for 1872, following the fire, cost us $16.80 per thousand feet. That was the average cost the whole year. So you see that the lumber manufacturers and the stump owners were benefited to the extent of about $2.50 a thousand in consequence of the Chicago fire. If the duty had been off, or if the rebate had been allowed, they would ouly have been benefited to the extent of 50 cents ; but, as it was, they made a good deal of money out of the Chicago fire. For the year 1873, immediately following the fire, the average cost of lumber was $12.72, a falling off, you see, of over $4 a thousand. Things were beginning to regulate themselves. In 1875 it was $11.68, a falling off of another dollar per thousand. Now, we strike the proper medium of trade, I presume, without the disturbing element of the Chicago fire. In 1876 it was $9.67, Saginaw losing a tremendous sight of money, you see. I don’t know how they can exist at all. In 1877 it was $9.73. In 1878 it was $9.66. In 1879 it was $9.50. These figures I can verify by oath to any extent. But now, gentle- men, this is what I wanted to call your attention to especially. In 1880 a little boom started, and the stumpage, being reduced to a small amount, could be easily handled, and an advance was made to $11.63 on the average. In 1881 it was still growing, and reached $13.92. In 1882, so far, my lumber lias cost me between $14 and $15 a thou- sand. That is the direction it has taken. It is in consequence of the manip- ulation of the stumpage. I can see no earthly reason why the Ameri- can interest should have any protection. Only in one thing, trom my standpoint, do 1 see that it applies. I believe that we can produce corn, pork, and beaus in Illinois, and those are the things that enter into the TH ADI.'lCUs? l'KAN ET AL. ] LUMBER. 1017 lumber business. The labor question I leave outside entirely, for I have no faith in it at all. I do not see why a Canadian should work for $10 a month when he could pass over an imaginary line into the United States and get $20 a month. I believe that the laborer upon the Cana- dian side is paid equal to our laborer here, and I can see no sense in anything else, and I object to the proposition that he is not paid as well, unless it may be that provisions would cost less in Canada than they do here. And as I have before remarked, pork, corn, and beans are the power that run the lumber business. Now, I believe that the cost of pork, corn, and beans in the States of Illinois, Michigan, and Wisconsin cannot far exceed the cost of the same articles in Canada. They may be able to raise beans up there a little cheaper ; I don’t know how that is. But against that there exists this consideration : That the Canadian has to pay anywhere from a dollar up more for taking his lumber to market than the American does, and the freight, as I understand, from Georgian Bay to Buffalo at the present time is about $3 a thousand, while the freight from Saginaw is about $2. There is a dollar against them; for Saginaw could not get lumber in this direction over these Broad prairies, where so much lumber is used, for less than $2 a thou- sand. There must be a margin at least of $2 a thousand against them in the delivery of lumber to our section here. Then the manufacturer of lumber in Michigan has other advantages in- cident to his manufacture. He can utilize the offal, the worthless prod- uct, so to speak, of his saw logs. He utilizes his sawdust and he sells his slab for tire wood. And, I understand, there has recently been dis- covered a process by which whisky is made from sawdust, and when that ultimatum is reached the manufacturer of lumber will be solid indeed. Having, then, the advantage of a revenue from his offal, and the advantage of from $L to $3 in the delivery of lumber, I cannot for the life of me see why he should be further protected by the advantage of $2 duty. Taking for granted the estimate made by the Saginaw gentleman, as published in the Inter-Ocean, that the expense of the manufacture of lumber is $13.50 per thousand — and, of course, I question his figures all the way through — you will see that he admits that, after paying a stumpage tax of $1.50, he still has a profit of $1.07, with which he has acknowledged himself satisfied. Now let us throw off this $2 duty and give him only a stumpage of $2.50. According to late estimates which are credited by the manufacturers, there stands now upon the Peninsula, reckoning from Ludington east to the Saginaw Valley, an average of 5,000 feet of fine timber on each acre of ground. Giving him a stump- age tax of $2.50 would still pay him $12.50 an acre for every acre of that ground, even if it is pine barrens. Hence he would receive $2.50 for each thousand of stumpage. By Commissioner Botelee : Question. Your argument seems to have a local application. You are aware that there are vast forests of lumber in other parts of America? — Answer. In the South and in California. Q. And that this matter of the tariff affects the whole country, and is not confined to any particular locality. — A. Of course, it cannot be claimed to affect the Pacific coast at this time ; but the quality of lumber produced in the South has a use that the products of Canada would not interfere with. The southern pine is all of a hard nature, while the Canada pine is soft. 1018 TARIFF COMMISSION. [THADDEUS DEAN ET AL, Q. Is the pine of the Middle States, for instance, of West Virginia (if it may be considered a middle State), of that character? — A. That is my understanding of it. I am not well informed, but I should judge, even if they were not — I conclude they are, however— there would be a local demand that this would never interfere with at all. We ship a great deal of lumber south from here, and even buy Canada lumber and pay duty on it, to ship it south. I do not see how that could affect the question. Q. The shipments from West Virginia are made over the whole country, even to France. They shij) a great deal of lumber to Europe from the mountains of West Virginia, though practically the timber there is un- touched. It is only recently that the lumber happens to be utilized, in consequence of increased facilities of transportation, but it is now be- coming an important interest. The timber is found to be of excellent quality and of great variety, not only the pine but the hard timber. If you throw down the barriers entirely, it will affect the interests there, besides depriving the country of a source of revenue. — A. You see what advantage they would naturally have, any way, over the Cana- dian. There is an immense territory. We ship lumber largely to Texas, and there is a large Kentucky demand. By Commissioner Underwood : Q. What part of Texas do you send lumber to? — A. We ship it largely to San Antonio, for instance, and also to Dallas largely. Q. Are you aware that one-half of the States of South and North Car- olina and Georgia, and nearly all of Florida and part of Alabama, is a pine forest? — A. I have gained a little information on that subject. Q. Do you know that they are now shipping large quantities from Georgia to Cincinnati and Louisville? — A. Yes, and they are shipping some here. Q. Is it not a very fine quality of lumber? — A. For special purposes it is; it takes a place that neither the Canada lumber nor the Michigan lumber can supply. That is the point. Q. Because it is of superior quality, durability, and strength ? — A. For certain purposes, yes, sir. Q. Now the States of Georgia, Sofith Carolina, and North Carolina have been settled for more than one hundred years, and yet they have been making turpentine and tar during all that time. Are you aware that there is hardly any perceptible damage done to the forests there as yet? — A. Hardly an inroad made upon them. I understand there is a great deal of timber there. Q. Do you know that the governments of Bussia and Prussia send to Georgia to get their pine there to make the masts of their vessels? — A. Yes, I know it is excellent for that purpose likewise. Q. They are the largest, straightest, and strongest heart pines in the world. — A. Yes, but it occupies a different place, as I remarked before. It supplies a necessity that we cannot supply with our pine. It is good for masts, for floors, and for some finishing purposes, and in this city where, notwithstanding we have this duty to pay, we draw upon the South now and will continue to do so more and more, as people build better houses. Q. For what purpose is the pine used that you take from here to Texas and the South? — A. It is used for putting up cheap houses. 1 don’t know why it should be shipped in that direction. I should think that the material that is raised down there would do about as well if the industry was there to work up the business. THADDEUS DEAN ET AL. ] LUMBER. 1019 Q. Precisely; if they had the same energy and industry, and the same means of transportation that you have here, would it not do as well? — A. I dare say it would take the place very largely of what we ship there, and I do not see why not almost entirely. Q. Of what particular advantage would it be, or could it be, to the American people to remove the duty? — A. It would hell) us to develop the Northwest; it would let out that Canada lumber. Q. Is there not a geographical protection on the American side that would in effect prohibit the introduction of foreign lumber? The Witness. How do you mean? Commissioner Underwood. I mean this: I mean the cost of trans- portation to get the lumber v from the Dominion of Canada into the American ports or cities. The Witness. They bring it now very largely, notwithstanding the duty. Q. If they do, what is the trouble? — A. The trouble is, that with this duty off* if would throw them more nearly on a par with our own man- ufacturers here. It would allow us to reach that timber we need at a fair price and help to develop the Northwest. You will see by the ar- gument of the manufacturers themselves, when fast running out of stock, that some day we will have to go to Canada and beg for that timber, and give them perhaps $10 to $20 per thousand. I say let us have it to day, and reserve our own a little until our railroads reach the tail end of our own limits, which they are fast doing. Q. If you will penetrate the pine forests of the South with your sys- tem of railroads and cheap transportation, which can be done, you will then get much finer fields for the lumber interest than the Canadian, and thus keep it in our own country. — A. The South does not appear to develop very rapidly, for they let us furnish them a great amount of lumber. Q. Perhaps you are laboring under a mistake. The South is devel- oping very rapidly. We were unable to crawl for a time, but now we have got so we can stand alone and walk, and we will walk. — A. I hope they are developing, for there is plenty of room. By Commissioner Kenner: Q. You stated just now that you had shipped lumber from here to San Antonio ; by what route did you get it there ? — A. There is one gentle- man here largely interested in the lumber business who ships there, and it usually goes % the way of the Missouri, Kansas and Texas Railroad, and through Saint Louis and over the Iron Mountain Railroad. Q. If you ship by that route to San Antonio, you pass through an almost unlimited territory of forests ? — A. Yes. The southern pine will not do for all purposes. The floor of this room and the joists could be made of it, but it will not do for the finer work. And we now receive lumber back from the South. Q. Where from? — A. We receive lumber from Tennessee. I have within a few days received lumber from there. Q. What part of Tennessee? — A. White oak from Nashville. I dare say I am receiving some to-day. I know I have got some on the way. Q. Did you ever use cypress lumber? — A. Cypress does not come here. We have the long-leaf pine and some black-walnut. Q. What is the character of the lumber you receive from Tennessee; what do you call it? — A. This lumber I am receiving to-day I think is a quality called box-boards. I presume it enters into the manufacture of 1020 TARIFF COMMISSION. [TUADDEU8 DEAN ETAL. wagons. It is a fine lumber, without knots. It is brought here because it is a grade peculiarly suited for that purpose. Q. Is not box- boards the term applied to the manufactured article? — A. We call the tree poplar. Q. Do you get poplar from Tennessee ?— A. Yes, sir. Q. Do you get black- walnut from Tennessee? — A. Yes, sir. Q. Is not black- walnut about the only lumber you do get from Ten- nessee ? — A. I say we get this poplar for box-boards. Q. Black- walnut is used in the manufacture of furniture. You do not pretend to build houses of it. Do you know that cypress is the best lumber in the world for building purposes, for durability ; that it will take a hard finish, and is useful for other purposes, even for furniture ? — A. I do not. Q. Are you aware that there are five or six million acres in Louisiana entirely and exclusively covered with it, which in time will develop into the greatest lumber region in the world, and furnish finer timber than you can ship to San Antonio ? Better timber cannot be found on the face of the earth, and in quantities to suit you. — A. It would seem a little unreasonable that we should cut off our forests here ; it is eating up our own bread, expecting to beg it of somebody else. By Commissioner Garland : Q. In the prices of Chicago lumber, as you quoted them, you indicated a yearly increase of about $2 to $2.50, as I recollect. — A. I gave you the facts. Q. That I understand. Did lumber advance correspondingly in Can- ada during that period ? — A. Probably not correspondingly, but it must have advanced considerably in Canada. Q. Can you explain why, when lumber advanced in this market $2.50 with only $2 duty, that Canada lumber did not come in here at that time? — A. They could not so suddenly prepare for the condition that existed. Canada, trammeled with this $2 duty, is now in the back- ground, They have not shown as much zeal in opening up their streams and in extending their manufactures, as I understand, in consequence of being so trammeled. Hence the American manufacturer, knowing the extent of their stock and knowing our own, can advance the price and sustain it, Canada not being capable of furnishing large quantities at short notice. I should say that would be the answer to the question. Q. Do you know the price of stumpage in Canada ? — A. I am some- what informed about the price of stumpage. Q, What is it at this time? — A. I believe the cost to be about $1.25 to the party enjoying the stumpage. He pays the government tax and he pays for the limit, and as I understand, it amounts in the aggregate to about $1.25. I am not closely informed about it. Q. Is there a Canadian tariff affecting the introduction of American lumber into Canada? — A. We ship lumber there, but I have no infor- mation upon that point. Q. Do you argue for the taking off of the duty on lumber here for the purpose of introducing Canadian lumber, irrespective of the duty on American lumber in Canada? — A. Certainly; for we have no lumber to send to Canada. THADDEL'S DEAN KT AL. 1 LUMBER. * 1021 Mr. A. G. Van Sciiaick, of the firm of Ludington, Welles & Van Schaick, Menominee, Wis., dealers in lumber, said: Mr. President and Gentlemen : 1 appear before you this morning as a substitute for a gentleman who was to appear, but who has been unable to do so ; consequently, what 1 may say to you will perhaps be like that of my friend who has spoken to you this morning — more of a selfish character than of a general nature. I represent an association of lumber manufacturers of forty years standing. I have been myself twenty-nine years connected with that house, and during that time I have had the opportunity of seeing the effect of the reciprocity treaty upon the western lumber business. I believe there are three things that enter into the consideration of tariff measures: first, the revenue for the government; second, the interest of the manufacturers of lumber, and third, the interest of the consumer of lumber. Those are the vital points, as I understand, which you are to examine. I take an entirely different view from my friend Dean, as to the effect of the removal of the tariff upon lumber. I sympathize wholly with the Saginaw report. I believe that it has been honestly made, and I believe as you enter further into this matter you will justify that re- port. But I believe this : that tbe moment you remove the duty from Canadian lumber, the dealers will go to Canada and buy their stumpage. Why? Because this market takes our lumber faster than we can make it. I, myself, have never reached the limit of distribution. Mr. Dean’s interest is selfish, and mine is selfish ; but the interests of the consumer are to be considered as well as the interests of the man- ufacturers who have invested their capital. If I understand, there is an export duty on logs of $1, and the moment you remove that duty Canada will require a price that will make it equal to the price at Saginaw and Green Bay, or other parts of Michigan and Minnesota. That is a propo- sition which I believe you cannot ignore. That is the strongest argument I shall make before you to-day. Next, Mr. President, let us consider the interests of the consumer. I will take the manufacturer last. The selfish interests should come last. What would the consumer of lumber gain in the State of Illinois were you to reduce the price of lumber to-day to $2 ? Seventy-five thousand men are employed in the manufacture of that lumber, and for every million feet twelve men are constantly employed. So that for the fifty millions produced we employ 600 men. Two hundred and forty are employed in Chicago ; 80 on the lakes, and the balance at the mills. What do the consumers lose, the moment you remove the duty? They lose the support of 75,000 men. What next ? You put them in agricult- ure as competitors in the tillage of the soil. I saw it stated last year that 77,000 men had come from Canada to this country to procure labor. Why? Because it is better paid. But remove this manufacture to Canada, and then what? Labor will advance there. I will say, Mr. President, that of the $14 that Mr. Dean states is paid out for lumber, almost all goes for labor, provisions, and freight. The prosperity of the West to day is largely aided by tbe manufacture of seven billions and abalf of lumber; tliirtv-six millions of tbat pine bas been burned since last March, and in ten years there would not be a vestige of pine in Minnesota, Michigan, and Wisconsin, from the effect of forest fires, which destroy four times as much as they did ten years ago. Mr. H. W. Sage, of Michigan, stated on the 5th of September, 1875, in this city, that for every thousand feet cut on the lower peninsula, 1022 TARIFF COMMISSION. [THADDEUS DEAN ET AL. four thousaud was devoured by fire. I believe he was rightat that time. Afterwards the forest fires were very great. Let me say to you that Canada has not the lumber that Mr. Dean thinks it has. The impression is that there are vast forests in Colling- wood and other places, the lumber from which will seek this market. It does not exist, I tell you. A million and a half was all the export from the Dominion last year. I can bring you a gentleman in this city who explored a tract, and he told me that there was not an average of fifteen hundred to an acre. The timber does not exist. On the Ottawa River, 200 miles above its mouth, the forests commence, and if Mr. Dean or any man expects to get it to Ottawa through the shoals and rapids, and compete with American lumber, he will be grayer-headed than any gentleman in this room before he sees it. The consumer is the man who should come before you to-day, and not Mr. Dean, who is here in the interest of philanthropy, as he said. First, I come in the interest of the manufacturers of the West, and I stand up here and say that they are entitled to a support, to a certain extent. If they were loading this country down with lumber they would not be entitled to it. But what is the fact? Mr. Dean says the prices dwindled down gradually. Why? The panic did it; it was because com was selling for 30 cents instead of 70 cents; wheat for 80 cents instead of $1.25. It was simply impossible to pass through a panic where everything was -entirely out of joint, aud expect lumber to sell at a profit. But Mr. Dean does not state that during the last three years the ad- vance in wages was at least 30 per cent. There was an advance in everything we consume, and lumber is simply made up of provisions and labor. My point is this: Remove the duty in the United States, and give the Dominion of Canada that increase, and they would not sell their lumber at the present prices. Mr. A. Soper, of the firm of Soper, Pond & Co., of Chicago, lumber dealers, said : I can say briefly that I indorse heartily the argument and statement of facts made by Mr. Dean this morning, and I think before many months have passed we shall show you that we have a large Tol lowing among the lumber dealers and consumers throughout the West. The question of the difference between the yellow pine of the South and the white pine of the North has been discussed, and I should like to have our secretary called for the purpose of giving you information upon that point. Mr. G. W. Hotchkiss, secretary of the Lumbermen’s Exchange, of Chicago, said : There has been some question asked upon which, perchance, I may be able to give you some information. There is a great deal of timber in West Virginia, and there is a small proportion of it of a similar char- acter to our timber in Michigan, Wisconsin, Minnesota, aud Canada, but the proportion is infinitesimal. From extensive research in that di- rection, I am prepared to say that there is nothing in the State of West Virginia which would affect one way or the other the supply of lumber THADDEUS DEAN ET AL. J LUMBER. 1023 which we recognize as the lumber of the Northwest. We have here in the States of Michigan, Wisconsin, and Minnesota, and in the provinces of Canada, what you would better know as the w hite pine, a soft pine which is valuable for linishing. It is strong in texture, easily trans- ported, and is fitted for all kinds of finishing work. It is free from tur- pentine and resin, which are the very qualifications which make the Southern pine most valuable. Let me correct here a statement of the Michigan delegation who placed the Southern resources at 89,000,000,000. The census report places it at 232.000. 000.000. There is an immense supply there. But of the South- ern timber for the last half century there has been shipped to the North- ern country the black walnut, for furniture, the maple, and the oak. Vast quantities of Southern oak and ash are brought here. Of the Southern pine our receipts here last season were something over 10,000,000 feet, from Tennessee, Georgia, Mississippi, and Alabama. There has recently been established in the city here a yard for the exclusive sale of Southern pine lumber from Brookhaven, Miss. But when you come to compare Southern lumber with Northern, you will find that it com- pares with that part of our lumber which we know as Norway pine. That is w orth about $2 a thousand less than white pine, and is unsuited for all the finishing uses for which white piue is used. I was very glad to see in the Inter-Ocean the question propounded to Mr. Bust in regard to the census. Some gentleman asked him what the opinion was in regard to the census report on timber. I have had an intimate acquaintance with the making of these reports of the North- west, and I was glad to see that Mr. Bust was prepared to affirm the practical correctness of those for Michigan. I wish to say to you that those for Minnesota and Wisconsin ^ere made by the most practical lumbermen of those States, calling to their aid the assistance of great numbers of lumbermen. We consume in the city of Chicago anaverage annually of 2,000,000,000 feet. When I say “consume,” I mean that the Chicago trade receives about 2,000,000,000 feet. This is distributed through the Northwest. The production of Michigan is not far from 5,000,000 a year $ the pro- duction of Minnesota and Wisconsin is perhaps two-thirds as much. You may place the production of white-pine lumber in the Northwest at about 8,000,000 feet. This is, as Mr. Sargeant says, exclusive of cities not having 8,000 inhabitants. You may drop out 50 per cent, from the estimate and boil the whole thing down, and you will have a demand for every man, woman, and child in the United States of 300 feet of white pine lumber each year. The consumption of white pine in the United States for the last year was about 18,700,000,000 feet. The consumption for the present year, as I recollect the figures, is 20,700,000,000 feet. The aggregate demand for white pine lumber between 1880 and 1890, based upon the average increase of population as it is shown to be in the decade from 1870 to 1880, will be an aggregate of 210,000,000,000 feet of lumber. Mr. Little, of Montreal, in some letters which appeared in connec- tion with the census, placed the entire stock of lumber of Canada at 10.000. 000.009. I think it will be somewhere from 50,000,000,000 to 75.000. 000.000. feet. The acting commissioner of crown lands for Onta- rio, who was acting commissioner four years ago, informed me this sum- mer that the present standing pine of the Province of Ontario was not far from 35,000,000,000. Mr. Little, in his estimates of the standing pine of Ontario, placed it at about one-half of the total production of the province, excepting Newfoundland and New Brunswick • so that, 1024 TARIFF COMMISSION. [THADDEUS DEAN ET AL, taking the same proportion of his estimate and taking what I consider the more reliable statement of the crown-land commissioner, it will give a production of 50,000,000,000 for the Province of Canada. By Commissioner Boteler : Question. The idea of a gentleman who preceded you was to remove entirely the duty upon all lumber, which would enable ns to get white pine free of duty, and possibly at a less cost, although there is a very strong argument why it would not be obtained at a less cost. If that idea is carried out and the reduction made, what would be the effect upon all other lumber'? Would it not affect lumber dealers disastrously'? — Answer. I am not prepared to give an opinion as to what the effect would be. Any opinion I should give would be too crude; and, in the position I occupy, I would prefer to make my statement of facts, which may enable others to base argument upon them. By Commissioner Kenner : Q. How long, at the present rate of consumption, do you think the white- pine lumber of the States you mention will last '?— A. The census esti- mates are 81,000,000,000 for the production of the three principal white- pine producing States, which woukl be about ten years’ supply from the time those estimates *vere made, the production of those States being not far from 8,000,000,000 per year. There is another thought in connection with that : There has been a great deal said about the lowness of these estimates, but I would like to say that the production to-day is greater than the limit of the esti- mate twenty years ago. I was a lumberman in Michigan ten years on the south shore of Lake Erie. At that time a prophecy was made that the lumber of Michigan would be exhausted in ten years. We then had a vast unknown country to the north of us ; but the country that was known, estimated and prophesied upon, has been exhausted, aud was exhausted within the time mentioned. The estimates at that time were made upon trees 14 and 20 inches in diameter; nobody thought of cut- ting a tree 12 inches in diameter. But the estimates now are based upon trees 8 inches in diameter — the babies and saplings. I do not speak of this matter any farther than to show that our forests are being : denuded very rapidly. We are taking the hoop-poles and leaving nothing what- ever for the future. Q. When you denude a forest of its natural growth of trees, what is the character of the trees which succeed those that are cut down ? — A. In Michigan the growth is principally an undergrowth of blackberry, in which comes up a poplar, a worthless shrub that never attains any great size. In some localities scrub-oaks grow up, but not of commercial value. Wherever the pine is cleaned out, that which is left perishes. The pine is like an Indian, and cannot bear civilization. In thirty years’ experience I have never found a locality where a large propor- tion of the smaller timber was left to grow that it did not die within a very few years, if, on the contrary, a thinning-out process is under- taken in the dense forest, it will thrive many years. The moment that settlers come in and civilization and smoke come in contact with those trees, they perish. Q. The tree which grows when the original tree is cut down in my coun- try is the scrub-oak; but let me suggest that it does not come from con- tact with civilization, but arises from the effect of the great law of na- ture, which requires a rotation of crops. If you cut out a scrub oak some other tree will grow, because nature requires some other growth,. THADDEUS DEAN ET AL. ] LUMBER. 1025 aD(I provides the food for some other plant. — A. I consent. That is the case, undoubtedly. Q. You ship lumber from here to the South'? — A. Yes; we have very large shipments to all parts of the South. Some of our lumber-dealers here in the city have yards established in Southern Missouri, Southern Arkansas, and the Indian Territory, and some, I think, in Texas. There comes up the difference between yellow pine and white pine. The white pine is adapted to all finishing purposes. It can be used where you desire to paint. Some of the Southern pine can be painted ; but we do not recognize it as a timber that will retain paint and make a handsome finish. Norway pine is a bastard, short-leaved pine, like the pine of the South, only a little more so; as much poorer than the short-leaved pine of the South as that is poorer than the white pine. Q. With the increase of population in the South, which must result from the railroads being rapidly built there and the introduction of ma- chinery, saw mills will come. Will not that cause lumber to be pro- duced largely in that section, and thus check the removals of the vast quantity you speak of 1 ? — A. That will depend upon the course the rail- road companies take more than upon the government; the government has nothing to do with it. There would be a very much larger con- sumption of Southern timber in the North were it not for the prohibitory tariff of the railroad. By Commissioner Boteler: Q. But you send Northern timber to the South ? — A. Yes ; but it is all sent by weight. I had an estimate from a gentleman who has shipped a large quantity at the rate of 2,240 pounds to the ton, whereas they call 2,000 pounds a ton. That makes a great difference in the freight. By Commissioner Porter : Q. Have you any statistics showing the effect of putting on the tariff of 1807 on lumber between the United States and Canada "? — A. With- out giving any opinion, I can state that at tire time the reciprocity treaty was in force, from 1855 to 1866, 1 was engaged in the purchase of lumber in Canada for the Albany market. I bought on an average at that time ten to eleven million feet per year of what we called u uppers.” W 7 hen I went to Canada in 1851 I bought that lumber at 7 and 14 — 14 for the best article ; and when I left there in 1860 we were paying 28 and 14, just double. By Commissioner Garland : Q. What was the effect upon the prices on this side ? — A. Of course the prices on this side increased in proportion to the increased price there; but I never attributed it so much to the reciprocity treaty as to the growth of the country. By the President: Q. I would ask you, if you are an expert in forestry, if there is any Southern wood which is a partial substitute for the white pine "? — A. The cypress would make a very good substitute for pine for many pur- poses. Poplar or wliitewood is of very great value in everything con- nected with wagon-making — for wagon-bodies and for finishing. 1 will say that there is not a shingle made to day equal to the cypress shingle; but we cannot get them up here on account of the freight. Poplar is very easily worked, and that is also one of the great advantages of white pine. White pine can be applied to outside uses where poplar and yellow pine cannot be. What I term the white wood is the tulip H. Mis. 6 65 1026 TARIFF COMMISSION. [THADDEUS DEAN ET AL. tree ; it is known in the different parts of the country by that cogno- men. By Commissioner Underwood : Q. Why is the freight so heavy on cypress timber ? — A. The towing is the greatest expense. Cypress is a heavy wood. You have got to kill it and let it stand a year before you can float it. I have been in Florida where they have girdled their trees and let them stand 18 months. It also grows where horses and cattle cannot get it out. They have to wait for the rise of the water to have it floated out. There is so much expense attending it that this will preclude it being brought to the .North. Mr. D. R. Holt, of Chicago, of the firm of D. R. Holt & Co., lumber manufacturers of Oconto, Wis., said: My mission here, gentlemen, is simply as a member of a committee to report the action of the manufacturers who met the manufacturers from Saginaw the other day. W e went over their report with them, compared our figures with theirs, and decided that it was unnecessary for us to do anything ; that there certainly was nothing to subtract from what they said, and that we could indorse what they have given you. We thought that would be the wisest way to make our report. It might be that in some instances we could have enlarged upon their figures. In the case of our own establishment, our figures would be larger than theirs. We are in Wisconsin, however, and they in Michigan. Some parts of Wisconsin would work a reduction of our figures. So that on the whole we considered it a fair statement of the lumber interest. You have all the figures before you, as I understand, and in as good shape as we could put them, or as we care to put them. By the President : Question. Your business is in Wisconsin ? — Answer. Our mills are in Wisconsin, but we have a business office here. I might say that as a rule the manufacturers are not the men who handle this lumber in Chicago. A good many manufacturers are dealers here, but their in- terests are scattered about, and we are not as compact as the manufact- urers even in Chicago. GEORGE W. MURRAY.] BULBS, ETC. 1027 GEORGE W. MURRAY. Chicago, III., September 9, 1882. Mr. George W. Murray, of Chicago, addressed the Commission as follows : Mr. President: It is at the suggestion of Mr. J. C. Vaughan that I appear before you in the interest of all people in the United States, without any exception; and what recommendations I have to make are not against any interest, financial or manufacturing, in the country, but are simply in favor of an increased sale and increased use of a class of material that tends to elevate and refine the people. I wish to call the attention of this honorable Commission to three lines of merchandise largely imported by the house with which I am connected, that of J. C. Vaughan, Chicago, and ask you to recommend in your forthcoming report a large reduction if not the entire abolish- ment of tariff upon them. 1 refer to, first, bulbs; second, French colored moss; and, third, bou- quet papers. These are all used by florists, and the bulbs not only by them, but by all classes interested in the culture of flowers and plants about their homes. I need not state that these bulbs are in the nature or perform the office of seeds, from which are grown flowering plants. Their use in forcing or hot houses to supply the holiday and general winter trade in cut flowers, and for home and park adornment throughout the spring months, is becoming more extensive every year. The trade in them has- grown annually of late about 33^ per cent, in this city, and our trade is small compared with that of the Eastern cities. There is no duty upon the importation of works of art produced by Americans abroad, and only 10 per cent, upon those of foreigners. In this we see a reasonable provision in favor of artists of this country. But were it not true that Congress wished to encourage the develop- ment of native talent, I think you will agree with me in believing that, for the culture and refinement that fine paintings, sculpture, and other works of art stimulate, Congress would not be unwise in abolishing duty thereon entirely. Let me ask you, then, to view this homely bulb as a work of art. Ho one will dispute that when the plant is grown and the bud has opened that there is a thing that possesses the maximum of beauty and the element in art most sought by the artist — truth to nature. The bulb is a work of art in the dark that ne^ds only the warmth of the sun or the green-house to make it visible and exert its never-failing refining influ- ence. These are surely good reasons for reducing the tariff upon bulbs from the present high rate — 30 per cent. — 10 per cent, more than upon seeds and 20 per Cent, more than upon foreigners’ art productions. Another and strictly business feature of the bulb trade is that these bulbs, so largely imported, cannot be grown in this country, as the elder Thorburn, Prince, Parsons, and others, all noted seedsmen, did testify, the experience of the first-named casting him not less than $100,000 at Queen’s, Long Island. If, then, there is no industry in this country to protect, which is a fact, there can be no tenable grounds in this age, when culture and refine- ment are so widely sought, for the continuance of 30 per cent, duty upon hyacinth, tulip, crocus, narcissus, and Lillium caudidum bulbs. The second matter to which I wish to direct your attention is the ex- 1028 TARIFF COMMISSION. [GEORGE W. MURE AY. travagant tax upon French moss. There is no firm in America that manufactures it, and, besides the moss used is not to be found anywhere in this country. Dried flowers are entered free, while this moss that is used with them in decorating and in floral pieces is charged half its value for admission There seems to be in this case, as in the former, an un- reasonable discrimination against that which affects for its good the better side of our natures. Thirdly, and lastly, there is an ad valorem tax of 35 per cent, upon bouquet papers — something not manufactured in the United States at all, and this being the fact there is no room to doubt that the tariff upon them should be greatly reduced. They are used to protect bouquets from drying and from soiling the clothes or furniture with which they may be brought in contact, as well for ornament. “ Bulbs cannot be grown in this country.” That is a statement I am authorized to make. My father-in-law, who has been in the culture either directly about his own home, or indirectly, for over thirty years, says there has been a total failure on the part of everybody who has at- tempted it. By Commissioner Oliver : Question. How many thousand dollars’ worth do you import every year ? — Answer. The firm with which I am connected does not import probably to exceed $10,000 or $15,000 worth a year ; but I am not speak- iug in the interest of that firm particularly, I am speaking in the inter- est of the common good of everybody in the country. By Commissioner Underwood : Q. Are you not mistaken in supposing that moss is taxed ? Under what name is it taxed ? — A. This colored moss is taxed 50 per cent. It is a dyed material, and I speak of it as not having been manufactured. Q. Iceland and other mosses are on the free list; under what head does this come ? — A. Moss dyed for making artificial flowers, I presume. There is some dispute between the importers and the appraisers in the matter of duty upon this particular moss. It is not used in making flowers ; it is used in making floral pieces, but still they attach this 50 per cent duty. The income of our firm, and probably of any firm in the United States, will not be materially increased by the reduction of the tariff; but the welfare of the people at large will be improved, and that is the only point I have to make. Q. You say there is no bouquet paper made in this country? — A. That is my understanding. Q. Is there any reason why it should not be? — A. I cannot see any reason why it should not be. Q. Could we not dye that moss here? — A. That probably could be dyed in this country. I do not question that. Q. Then if the crude moss is free, ought not our own people to be encouraged to dye it? — A. I must confess that in the matter of bouquet papers and moss I have not very much to say; I only gave a few words to them; still they are, for the time being, taxed without any benefit to the people. By Commissioner Garland: Q. Would the reduction benefit the people? — A. It ought to be re- duced; but, as there is a great deal of competition in the business, I make no particular point on that. In the matter of bulbs, however, I want to insist that that is important, because that touches a side that every educated reasonable man will sympathize with. 6. CORNING JUDD ET AL.J REVISION OF THE TARIFF. 1029 S. CORNING JUDD ET AL. Chicago, III., September 9, 1882. Mr. S. Corning Judd, chairman of a subcommittee of the Iroquois Club, of Chicago (the subcommittee being composed of A. T. Seeberger, E. O. Brown, and S. S. Gregory), made the following statement: I desire to say that the subcommittee of the committee of the Iroquois Club are here this afternoon for the purpose of presenting only a few facts, and recalling some which have been presented to the Com- mission, and of course with which they are familiar in a general way, without regard to any particular industry or any particular interest. The club is composed, I might say, of judges, professional men, mer- chants, and representatives of various other businesses in this city and vicinity. On last Tuesday night, at a meeting of the club, it was suggested that, inasmuch as certain interests might not be properly represented before this Commission, and inasmuch as the club has a very definite theory with respect to a protective tariff, a committee should be appointed to appear before you and submit some facts which are particularly local and having reference also to the local interests of which Ghicago is the great center in the West. This committee was constituted with ex-Senator Trumbull as chairman. He has been ab- sent .from the city, and, finding himself so overwhelmed with business that he was unable to attend, he took it upon himself to appoint a sub- committee, ot which I have the honor to be the chairman. This sub- committee have had very little time to gather such details as they would be glad to present ; but, inasmuch as we understood that the Commis- sion would not remain here longer than to-day, they have had to throw their facts together hurriedly, and, such as they are, I present them. I regret that there has not been more time ; but without further comment, I will submit what the subcommittee have prepared for the considera- tion of this Commission : To the honorable the Tariff Commission : The Iroquois Club, of Chicago, desire us in their name briefly to lay before your body the views of the club on the subject of tariff revision. It is opposed to the system and theory of protective duties, and be- lieves that the tariff should be revised with reference to the revenue to be derived therefrom, and with reference to that only; and we think it peculiarly appropriate that such a representation should be laid before you here in the great center of a vast agricultural population. Here in the West, as in the East, this Commission has met many indi- viduals and delegations appearing before it to ask for new or higher protective duties. We have failed in following the report of these ap- peals to see that anything has been urged in such cases as to the inter- ests of the consumers of the manufactured articles for which the pro- tective duties or the artificial price is asked. Nor have we noticed that, where higher duties on raw materials were asked for, any consideration was given by those who asked them to the fact that no similar increase of tariff even on the manufactured article could prevent such increase of the raw material from shutting the markets of the world to the makers of the manufactured article. 1030 TARIFF COMMISSION. [S. CORNING JUDD ET AL. In every case, and it perhaps is natural that it should he so, these in- dividuals and delegations appear before this Commission in the barest selfishness, without a thought or care for any man’s interest but their own. We do not appear before you as the representative of any par- ticular interest or industry but as citizens of this great metropolis of the West, with a just pride in her vast achievements and present prom- ises, we ask that you should remember in making your report that it is the desire of a portion, and as we believe a large majority, of her people that all duties based upon the protective theory shall be abol- ished, to be replaced only by duties levied for revenue alone. The men who think thus are in the main unorganized and without the incentive to appear before this body which combination gives. That which is everybody’s business is nobody’s business, and thus the consumer asks for no hearing, while the manufacturer argues his case with persistency and ingenuity. We cannot, of course, attempt to place before your Commission at this time a detailed argument of an exhaustive and scientific nature on commercial freedom generally and its advantages. With such arguments you are familiar, and will give them doubtless such weight as you may think proper. We desire to suggest only certain facts which have a direct bearing on the subject of protective duiies with relation to the peculiar interests of this section. The object and the effect of protective duties is to raise the price of the articles protected. The manufacturer may, in ar- gument, persistently deny that protective duties raise the price of goods, but his answer to a proposal to take oft* the duty on the protected article is always, u The removal of the duty will enable the foreign manufact- urer to undersell me.” The effect of the increase in price must be disadvantageous to the consumer, unless there be countervailing advan- tages. Such an advantage is claimed by the protectionist to exist in the enhanced wages of labor in these protected industries. We deny that such result occurs ; but, granting that it does, we ask this Commission to remember, as bearing upon the interests of tbe great agricultural country of which Chicago is the emporium, that allowing the largest estimates of persons engaged as workmen or employes of these manufacturing interests of the United States, they amount to but 3,000,000 as against the total of 7,000,000 engaged in agricultural pur- suits, 3,000,000 in professional and personal service, and 1,500,000 in trade and transportation. These calculations are made on the basis of the census returns. Under this most liberal estimate of those employed in connection with protected industries, 11,500,000 workers are engaged in entirely unprotected industries against 3,000,000 who are employed in those which are protected. A farmer is, however, told that protective duties on manufactured articles benefit him by giving a home market for his goods. With ref- erence to this proposition we call the attention of the Commission to the following facts : Chicago is the greatest of grain and provision markets. In 1881 an aggregate estimate of the agricultural products shipped from this city showed them to be of the value of $340,075,000. The experience of the trade in Chicago, therefore, must be valuable, and the time has never come when any combination of circumstances or of capital has been able to prevent for any considerable length of time the price of these products in Chicago from following tbe markets of London and Liver- pool. In the London and Liverpool markets the farmer aud farm laborer, for whom we speak, without the advantage of any tariff protection 8. CORNING JUDD ET AL.] REVISION OF THE TARIFF. 1031 whatever, enters into competition with the most illy-paid labor of the world — with the u fellahs” of Egypt, the lowest caste of India, and the lately enfranchised serfs of Russia. He is obliged to do this with the price of all his farm machinery, with the necessaries of life, and of transportation to the seaboard and across the ocean enhanced by pro- tective duties. We submit that the tariff needs in this instance decisive revision. We also ask the attention of the Commission on this question of a home market for the farmer to the following facts : In I860 the agri- cultural products of the United States exported were $295,000,000, or about 79 per cent, of the whole amount of the exports. In 1870, $391,000,000, or 79 per cent, of the whole amount. In 1880, $080,000,000, or 83^ per cent, of the whole amount. In 1881, $730, 000, 000, or about 83 per cent, of the whole amount. An increased home market does not seem, in the light of this expe- rience in prices and the growth of foreign demand, a necessity for the farmer worth his paying 25 per cent, additional on all domestic goods by him purchased. Again, we ask the consideration of these statistics from Mr. Spofford’s American Almanac. The prices obtained by the unprotected farmers of the Northwest for great staples, in I860 and 1880, under a revenue tariff and a protective tariff respectively, compare as follows: 1860. 1880. Flour, per barrel Wheat do $0 64 to $0 95 4 25 to 5 50 37 to 47 1 35 to 1 70 $0 48£ to $0 61 3 75 to 5 75 36 to 49 1 03 to 1 59 Products of protected industries compare as follows : 1860. 1880. Bar iron Scotch pig iron Leather $41 00 to $44 00 20 00 to 27 00 22 to 32 $50 00 to $85 00 21 00 to 35 00 23 to 31 Salt (Liverpool market) per sack 68 to 1 15 1 20 to 2 50 This furnishes, it seems to us, a suggestive commentary upon the theory of the benefit to the farmer from protective duties on the home market theory. We ask the Commission also to consider these facts. The nine prin- cipal manufacturing States — Maine, New Hampshire, Vermont, Massa- chusetts, Connecticut, Rhode Island, New York, Pennsylvania, and New Jersey — in 1850 possessed $3,130,989,857, or 43 per cent, of our national wealth. In 1860, the decade having been one of a low tariff, compara- tively speaking, they possessed of the national wealth $5,591,607,424, which was only, however, 34 per cent, of the whole. They had increased the sum of their wealth 78 percent. During the same time the agricul- tural States of Ohio, Indiana, Illinois, Iowa, Michigan, and Oregon in- creased their wealth 127 per cent. From 1860 to 1870, the decade having been one of high protection, the former nine manufacturing States had increased their wealth from over $5,000,000,000 to almost $15,000,000,000, constituting 50 per cent, of our national wealth. The increase was 173 per cent. In the same decade the agricultural States last mentioned increased their aggregate wealth only 64 per cent. 1032 TARIFF COMMISSION. 6. CORNING JUDD ET AL. Iii the light of facts like these comments upon the interest of the ag- ricultural section of the country in relation to the tariff seem needless- We believe that, with protective duties swept away, the aggregate in. crease in wealth would not only be as great but vastly greater, and it would be equitably and advantageously distributed over our common country. The Commission may be told by persons appealing for protective du- ties that Chicago has become a great manufacturing center, and can no longer be considered as leagued wholly in interest with the farmers of the West. We hope it will also be remembered, at the same time, that these manufactures are to a very great extent, such as the meat packing and canning industry, the boot and shoe industry, and other unpro- tected industries which, in spite of being forced to pay tribute to the protected interests, have healthily and steadily grown without govern- mental or official interference to their present vast proportions. By Commissioner McMahon: Question. Bid I understand you to say there that boots and shoes are not protected? — Answer. That is what it says here. I did not pre- pare this report. Commissioner McMahon. There is a duty of 35 per cent. The Witness. If that is true the statement ought to be corrected. Many protective duties were imposed at their present rate during the war, when the necessities of taxation had caused the imposition of similar internal-revenue excise on the same articles when manufactured here. Such protective duties were then proper and legitimate taxes, but the internal-revenue excise has been done away with while the tariff* duties remain. It is earnestly hoped, we believe, by a majority of the American people and by a vast majority of the thinking and enlightened classes of this section, that the labors of this Commission will result in a scientific re- vision of the tariff*, which will correct its present bitter injustice to the masses of the people. There is another phase of this question which we would suggest to your honorable body, although it perhaps may not be contemplated that your report should embrace any discussion upon such question. The only taxation for which warrant is found in the Constitution is such as produces income for the government. A tariff*, so far as it is protective, operates to redistribute a portion of the wealth of the country, taking from the many to give to the few. It seems to us that any legislation having this for its object, however specious the plea upon which it may be urged, is beyond the power of Congress and outside of the Constitution. Mr. Justice Miller, deliver- ing the opinion of the Supreme Court of the United States in the case of Loan Association v. Topeka (20 Wallace, 655), says: To lay with one hand the power of the government on the property of the citizen, and with the other to bestow it upon favored individuals to aid private enterprises and build up private fortunes, is none the less a robbery because it is done under the forms of law and is called taxation. This is not legislat ion. It is a decree under legis- lative forms. Kespectfully submitted. S. CORNING JUDD, Chairman , Su hcom m ittee. E. O. BROWN. A. F. SEEBURGER. S. S. GREGORY. S. CORNING JUDD ET AL.J REVISION OF THE TARIFF. 1033 Chicago, September 9, 1882. The statistics above submitted are largely taken from Spofford’s American Almanac, and can be verified. By Commissioner Kenner : Q. You made a remark about the consumption of the country. I am a large consumer of coru, and a large consumer of flour and oats. Now, sir, you have compared the year 1800 with the year 1880 Had you taken 1882 as your basis of comparison, you would have found the prices for this season are increased not less than twofold, and in many cases threefold. — A. That may be true. Q. If the article in 1880 being lower than it was in 1800 be a proof that the farmer is not protected but is injured, why should not the price of 1882 prove the very reverse'? — A. Because of varying circumstances or conditions. Q. In other words, the price of the article does not depend upon the tariff? — A. Not altogether. As I understand it — although I am not go- ing into an argument — the facilities in the way of manufactures may have a very decided influence. But, if the tariff be removed from the articles, it seems to me it stands to reason that the price would be that much less. But, still, as I said, I do not want to make any argument upon that proposition. I am not here for that purpose. We are now dealing generally with specific items in reference to entire decades. Q. 1890 and 1880 ought not to be a test. — A. I am not a dealer in grain and products, and as to the details of prices 1 could not answer your question, and could not give the causes for the changes of p rices. By Commissioner Oliver : Q. You make a comparison between I860 and 1880 ? — A. The decades. Q. Have you taken into consideration the greater volume of money in 1880, which, of course, makes all values higher? — A. We have got these facts, and ask that deductions be made from them. I say to the Commission, as 1 said in the outset, that I did not prepare the paper. As to what Mr. Gregory and the other gentlemen had in their minds, I do not know. Q. The price of labor in Chicago to-day is about $1.50, as I under- stand, and the price of labor abroad is less than one-half that amount — and there is no one, I suppose, who will contradict that assertion. Seventy-five cents would be a very high price. Would you expect that the prices of labor here and abroad would even up, under your ideas, and get nearer together — the price abroad going up, and that here com- ing down ? — A. I am not prepared to say that without taking into con- sideration all the surrounding circumstances. I coniess that that is a branch which I haven’t inquired into. I have been in politics but very little, and that is a question bearing upon details. Q. You recommend the abolition of all these duties, as I understand ? — A. No, sir ; we recommend such a revision of the tariff as shall operate in its objects and effects to produce revenue or income to the govern- ment, and not operate for the purpose of protecting a few to the exclu- sion of the many. Q. What specific recommendation do you make? — A. I make none, because I have not had that under consideration. By Commissioner Ambler : Q. Is the club which you represent a social club? — A. It is social and political also, it may be said. 1034 TARIFF COMMISSION. [S. CORNING JUDD ET AL. S. S. Gregory, another member of the subcommittee of the Iroquois Club, made the following statement : By Commissioner Porter : Question. Are you secretary of this club? — Answer. No, sir; I am a committee-man. Q. You are the author of the paper that Mr. Judd has read to us ? — A. I avow responsibility for all the figures. Q. I understand you to base your figures upon the census reports of the wealth of the country, and nothing else. That is to say, that the census shows that the wealth of the country in 1850 was so much, and the total wealth in 1860 was so much. Now, do you understand that those estimates of wealth are simply based upon the assessed valuation of property? — A. No, sir; they are not, clearly. Q. Do you know that they are not? — A. Yes, sir. Q. Will you explain? — A. I am not familiar with the details; but the bureau of statistics took the returns of the census made by the officers gathering the census returns, and on that basis (and perhaps they have some other sources of information) the bureau of statistics has made the estimate, not upon the assessed valuation, but the real or actual valuation. Q. Are you aware of the fact that the enumerators of the census have never attempted to deal with the wealth of the country? — A. No, sir; I am not. I am aware that the census returns contain what they call assessed valuation. Commissioner Porter. I have myself made estimates of the wealth of the country for this year, and I wish to correct you. There are no official reports except the census reports, and they cannot be based upon anything except the assessed valuation. For instance, here in Chicago personal property is not assessed at more than one-fifth of its value, and it would be unsafe to make any estimate of the growth of the wealth of the country from those returns, unless you take into consideration the great number of other elements, which have been marked out by Edward Atkinson, and others perhaps, and those statements show the fluctuations that occur. I make this statement because several gentlemen have come before the Commission who have based their estimates of the growth of the wealth of the country on those returns. It is a fallacy. The Witness. I would ask you if you materially disagree with that estimate of the actual wealth of the country? Commissioner Porter. Certainly. The Witness. I concede at once that those are estimates, and are not entitled to the weight that accurate figures would be, of course. By Commissioner Ambler: Q. Let me inquire whether it is not the fact that in the older, longer- settled States the tax duplicates more nearly, as a rule, represent the wealth of the country than in the newer Western States? — A. That is a question of individual judgment. I should say that that is true in the East perhaps, and through some sections of tbe West; but there are communities in the West where the Western element so strongly predominates that the estimates of wealth are probably too large. Q. I was speaking of them as a general rule. Is it not the rule that in the more sparsely-settled regions more property escapes taxation than in the older portions? — A. I should say so as to personalty, but with realty the contrary is true. In Chicago persons who have had large amounts of personal property have been assessed to within a very inconsiderable fraction of its true value. 8. CORNING JUDD ET AL.] REVISION OF THE TARIFF. 1035 By Commissioner Porter : Q. Personal property in the Eastern States is more liable to be as- sessed ? — A. More liable to escape assessment in great cities like this, New York, and Boston, and places where there are large accumulations of wealth. By Commissioner Underwood : Q. You are here representing the agricultural interests. I want you to let us know what it is that the agriculturist consumes that you think is taxed too high, and what it is that he produces that you think ought to be protected. — A. As Mr. Judd says, that is a question for careful consideration by a body of experts. Q. How can we consider it unless we get information? — A. I would mention woolen goods; I think they are too high. Woolens, iron, and other articles are taxed upon a protective basis. I think the farmer and consumer in the West, and all over the country, will have very little to complain of when the only trouble shall be that these duties are unwisely levied, but upon a right principle. The impression now is that they are levied upon a wrong principle. Q. What is the duty upon woolens ?— A. I have examined the matter very hurriedly, and have not brought the accurate figures with me. If I remember correctly, there is both a specific and ad valorem duty, and I think that those duties should be reduced ; but this would be a matter of adjustment and experiment. It should be ascertained how the largest amount of revenue could be produced from woolen goods. That would be a matter of experiment. Q. What is it that is too high ? — A. I say that the duty is. There are three classes of woolen goods, I believe. Q. What is the duty that you complain of? — A. There is a specific duty on the first, and I have forgotten the exact details. I say that all those duties are too high, probably. Q. What are they ? — A. I have read them over, but I can’t carry the entire customs act of this country in my head. Q. I want you to let me know what the duty is, and what you think it ought to be, upon the three classes, and then that will give us a chance to do what you think is right, if we agree with you. — A. I would not venture to suggest that to the Commission ; but if they should announce that they would adopt that basis, of course we could very readily secure a committee of experts to do it. By Commissioner Boteler : Q. Notwithstanding these high duties on woolens, to which you refer, did you ever know the ordinary woolen cloths worn in this country to be as cheap as they are now ? — A. As a matter of personal experience 1 do not think that my clothes are cheap at present. That is the only opportunity I have of judging. I am not a dealer in clothing. I would say, undoubtedly, there has been a shrinkage in prices ‘since the war, owing to the contraction of currency and the reduction to a gold basis ; but I am not aware that those goods are specially cheaper, and they are not so cheap as they are in Canada and abroad generally; I know that incidentally, and I do not see that an American ought to pay any more for his clothes than an Englishman or a Frenchman. Q. In your paper I think you stated, if I heard it correctly, that the Constitution does not warrant the levying of duties for the encourage- ment or protection of American manufacturers? — A. We suggest that view; yes. Q. Are you aware that the very second law which was passed by the 103G TARIFI COMMISSION. [S. CORKING JUDD ET AL. first Congress that met after the adoption of the Constitution (in which were members to the convention that framed the Constitution) passed an act partly for the encouragement and protection of domestic manu- factures? — A. I believe there was some such legislation at an early stage. Q. Are you aware also of the further fact that there has been no ad- ministration, from Washington to the present time, but has given its adherence to laws looking to protection of domestic manufactures? — A. I am well aware in a general way of what you say, that ail adminis- trations have concurred in that construction of the Constitution; but, as an original question, it occurred to me that the remarks of Judge Miller were certainly worthy of consideration. By Commissioner Ambler: Q. Is it an original question after one hundred years of our national life? — A. Perhaps it ought to be treated as such. By Commissioner Boteler : Q. Is it true that we know better what is meant by the Constitution, after one hundred years, than those who were contemporaries of the framers of the Constitution ? — A. I do not think that necessarily fol- lows. We know a great many things that were not known or dreamed of one hundred years ago. The frame-work of our government has been essentially altered since that time. Q. I speak of an instrument that existed nearly one hundred years ago — the Constitution — and to which you have referred, and I ask whether you think we are better qualified to construe that instrument than the men who made it? — A. Personally, I should say not, of course; but, so far as the query applies to the statesmen and jurists of this day, I should say that they are equally as competent to construe it as men of that age of equal capacity. By Commissioner Ambler : Q. That is to say, you think the statesmen of this day know better than the statesmen of 1789? — A. Not necessarily ; though it is a familiar principle of law that the testimony of a legislator as to the intent of the legislature is never admissible on the construction of a statute. Q. I have not even claimed that it is, but contemporary legislation is always admissible, I suppose, as indicating its intent. — A. It is fre- quently considered. I desire to make one statement in reference to boots and shoes. The statement was made that that industry is protected to the extent of 35 per cent., I think. I suppose that refers to the tariff on manufactured leather not otherwise specified* I desire to explain for the benefit of the Commission what we meant by saying that the boot and shoe in- dustry was not protected; that the value of the goods imported under that head was $018,471, for the year 1881, and that the duties on those goods amounted to a little over one-third of that sum ; and that there are plenty of firms in Chicago alone that manufacture much more than all those manufactures of leather not otherwise specified that were im- ported. So that it is a matter of the utmost indifference to the boot and shoe men whether the tariff is kept up or not. Q. Hoes not that indicate that they are overprotected, and that there is, in substance, a prohibitory duty ? — A. Not at all. Q. That is the ordinary argument. — A. That depends. We have here a protection of 20 cents upon a bushel of wheat, and it might as well pay $5 a bushel or 5 cents ; it has no more to do with the course 8. CORNING JUDD ET AL. ] REVISION OF THE TARIFF. 1037 of trade in the wheat centers and with the manner in which wheat is distributed to the world than the whistling of the wind. And so it is with the protection to boots and shoes. I believe we can make boots and shoes more cheaply here than anywhere else. By Commissioner Garland : Q. The question in regard to wool was left in a rather unsatisfactory condition. I understand you are representing the agricultural inter- ests here ? — A. No, sir. Q. I thought you were speaking for the farmers. — A. We speak for this section of the country, as we understand. Q. Speaking for the farmers, do you state that the present duty on wool, in the opinion of the farmers, is too high ? — A. If 1 were to state my judgment of the opinion of the farmers of this State, Wisconsin, Iowa, and Minnesota, from what little I know upon the subject, I should say that it is their opinion in a general way. Q. Speaking for them, you ought to know just what they claim. — A. No, sir. I do not claim anything of the kind. I say that is a ques- tion of experiment. I cannot express myself any differently. Q. Do you know what the present duty on wool is ? — A. As I said, I believe there are three classes of manufactured wools upon which there is a duty of 10 and 12 cents specific, and some ad valorem duty. Q. Ten cents a pound and 11 per cent, ad valorem you think is too high l — A. Of course, as I said, I cannot answer any such questions. I say it is just so much too high as it tends to keep out foreign wool, or woolen manufactures that could be more cheaply sold here than ours. Q. How much more wool is consumed here than is raised here ? — A. I cannot answer that. I cannot furnish these statistics when I am on my feet. 1038 TARIFF COMMISSION. [O. A. BISHOP. O. A. BISHOP. Chicago, III., September 9, 1882. Mr. O. A. Bishop, of Chicago, an iron-worker, representing the Knights of Labor Association, gave his views to the Commission as fol- lows : Mr. President: I have been chosen to represent the labor element, at least a large portion of the organized labor element in Chicago, to your honorable body. Of course we represent here the other side of the tariff question. When 1 say u the other side of the tariff* question,” I mean the side on which the laboring men are interested, and not the side upon which monopolists are mostly interested. I shall have but one or two recommendations to make; and to preface my remarks, I might state, as an indication of the general feeling, that when the motion was made in my organization to prepare for a hearing before this Commission, there was a motion made to lay it on the table, and the argument was made that it is no use to appear before that Com- mission, for they have paid no attention to our wants in Congress, and they certainly will not pay any attention to our wants here. I argued that we were citizens of this Republic, and that this Commission was our servant, and that we had as much right to appear before this Com- mission as the greatest manufacturer in the land. The motion to lay on the table was voted down, and I was instructed to appear before you, and I hurriedly drew up these few remarks. Of course they are not grammatically arranged, for I have never had but three months’ school- ing in my life. I was born in this city, and this paper was written, I will state, at my work bench. It covers the ground according to our views. The statements are of a general character. We also are pleased that this Commission has been appointed, for we believe that in order to obtain correct legislation, the legislator should ascertain the wants of the people. The paper which I have prepared is as follows: u Gentlemen: I have been chosen by a labor organization of this city to represent them before your honorable body. We believe that correct ideas should precede all legislation, and we are pleased that your Commission has been appointed. “And feeling that false economic principles, antagonistic to the wel- fare of the wage-working and producing classes, would be urged by the great manufacturers and would-be monopolists of important industries by basing their arguments on the hollow assumption that to protect them by a high tariff* would be to protect the wage-worker, i. e., they would be enabled to pay higher wages — that this is a base delusion and a snare to catch the votes and good will of those who toil in facto- ries at high-pressure speed, ten to twelve hours per day, and are paid just enough to keep them at the forge and furnace from day to day, while they get the wages back in high rents, &c., ignoring the great economic law of competition that governs the wages of the laborer as well as his product under our unjust industrial system. “It must be evident to the average mind that to prohibit the product of the poorly-paid and landlord-ridden worker of the old world from entering our country, and not to prohibit the importation of the cheap O. A. BISHOP.] THE LABOR ELEMENT. 1039 laborer, is a great injustice to the producers of wealth here, and is equivalent to saying to us that the masters shall have free trade in what they want and no competition in the markets for their goods or wares, which they control by powerful associations (trade unions) which re- quire large deposits of cash as a guarantee that they will not undersell or overpay the wages agreed upon by the association, but they may im- port as many workers as they choose to intensify the competition for a chance to work, well knowing that the same law governs in both cases. The most destitute man works the cheapest, and his wages will, in a measure, be the standard for all, and the more competitors of this class the lower the wages and the greater the profits of the employers. “ I will cite one or two cases in point. Some four years ago the glass- blowers were receiving $1.50 per box for making glass, and a good journeyman could make from $175*to $225 per month (none too much, considering the average life of a glass-blower is only nine years). They had a strong union; every man and boy was protected by it. They had a large treasury and could prevent competition amongst themselves. But in an evil hour their employers discovered that they could use the steamships which the workingman’s genius and energy had perfected, to whip him into the traces of slavish toil. They saw over in Belgium a lot of idle glass-blowers. The high tariff had shutout their wares from our market, and the expense to briug a man over here was only $28. They immediately sent an agent over, and he made contracts for their labor for three years at 50 cents per box, and transportation to and from this country at the expiration of their term of service. Three hundred such coolies were brought over and landed at New Albany, Ind., and with- out warning the American worker was given the mean alternative of discharge or 00 cents per box — a reduction of 200 per cent. They very indignantly refused. The foreigners were put at work in their places. The citizens of New Albany refused to deal with or board them, and the masters were forced to build a house for them and furnish them whisky, tobacco, and stale bread and beef, charging to their account u on the truck-pay plan.” Thus the masters gained the large tariff tax and $1 per box reduction in wages. “That is how protection protected the American laborer. Of course it was a good thing for the masters, but grievous outrage upon the in- dustrious American worker who had to sacrifice his trade and seek other means of life; and the man that built a house paid as much for his glass as ever. I could cite a parallel case at Saint Louis, in the iron trade. u This being the case, where unscrupulous employers are disposed to take advantage of it, you must admit that it will work disastrously to the wage-workers. And in another way it works ill to us, and to the emigrant likewise. In a conversation I. had not long ago with a journey- man hatter, he said : “Our hat factories at home (Birmingham, England) are all closed up and have been so long that the grass has grown in the factory streets. I saw that nearly all of the hats sold there were made in the United States, and, reasoning logically, I came to the conclusion that trade was brisk in America, and I would go there. I scraped to- gether cash enough to pay my fare out to Connecticut, where a large factory was located, and applied for work, ouly to be told that they did not employ many men, mostly girls and boys, and machines; a girl at $4 per week could make more hat-bodies in a day with a machine thau could ten men by hand a few years ago. And to my horror I realized my situation; my seven years’ apprenticeship was wasted; my trade, which I had made such a sacrifice to acquire, was lost, and I could 1040 TARIFF COMMISSION. [O. A. BISHOP. see but one way for us to get the trade back to my home, and that was to invent more perfect tools and employ our little babies to tend them.’ 7 This man is a type of thousands who come to this country thinking trade is good, and, after finding they can’t get work at their trade at any price, drift into other occupations already overstocked, and thus, by their competition, reduce the general average of wages of all classes; and low wages means less consumption and less production, each react- ing upon the other in turn with a downward tendency, ending in a financial panic, filling the country with bankrupt merchants, manufact- urers, farmers, and idle wage-worker ( i . e.) tramps; and after a period of misery and suffering, an equilibrium is established and then we re- peat the process. And it is high time that statesmen turn their atten- tion to adjusting the industrial system of production and distribution more in harmony with the development of machinery and various other discoveries, instead of quarreling over the tariff questions and the spoils of office. If not, I fear the masses in their blind condition will rise like Sampson of old and destroy their temple. And even now he must be deaf who hears not the mutterings of the distant storm. “But this will suffice to show how shallow are the claims of the pro- tectionists in this age of wonderful development, when steamships, railroads, telegraphs, and telephones have brought the nations of the old world to our very doors, and can at a moment’s notice pour their idle millions into our factories to compete with us for the right to live, thus causing strikes, lock-outs, riots, and discord everywhere, which, unless checked by wise legislation, will swell into revolution and an- archy; and to prevent this will be the work of great, noble, self-sacri- ficing men. “We believe that all tariff should be abolished and absolute free trade be the rule, because it is a form of monopoly and prevents the masses from utilizing the resources of life free and unrestricted, and will be the means of delaying the era of co-operative industries, which must, in my humble opinion, be the next step in civilization. “Again, this form of monopoly works a great wrong to others than factory and mill operatives; namely, it withholds from the operative the just share of his product, and he is not able to exchange with the farmer for the produce of the land, and has to go without many of the necessities and some of the luxuries; and the farmer, not being able to readily sell his produce near home, seeks a distant market, pays usuri- ous freight rates and sells cheap, and in return pays the manufacturer his doubly-protected price for iron, glass, coal, salt, lumber, and cutlery, and the only satisfaction he receives when lie complains is to be told, “O/q we must protect home industries” ; and as a proof that they have been protected well he sees that Messrs. Brown, Jones, and Smith have each made $100,000 this year without an hour’s toil — more than one hundred farmers have made by fourteen hours’ hard work each day for a year — a condition manifestly unjust, and a thing that cannot long continue without causing trouble. “ What we most desire is liberty. It has been the watchword for ages in the past, and will be until all men recognize the equality of all men of all climes to the free use of the natural forces of nature, and his right, as the fish in the sea, to make his home in any part thereof. And we believe to abolish all forms of monopoly, whether national, state, cor- porate, or individual, will be to take one long step toward that “most perfect government, in which an injury to one is the concern of all.” “ It was stated yesterday by the lumber interest that they had paid in wages to 50,000 workers $17,000,000. Truly a large sum, but if divided O. A. BISHOP.] THE LABOR ELEMENT. 1041 b.y 5G,000 it gives to each worker the insignificent sum, for a year’s hard toil, amid snow and ice in winter ; and malarial fever in summer, $304, with whicli to clothe, feed, and educate himself and family, while the few employers cleared, by their own figures, nearly $4,000,000 net, and still have $40,000,000 worth of mills and tools on hand. Why should they not wish a continuance of the monopoly when it pays so well ? And your attention is called to the action of the Lumberman’s Exchange (a trade union). The other day they met and raised the price of all grades of lumber $1.50 per thousand ; which, if made general on the 3,910,500,000, will increase the profits to $8,000,000 — a very mild species of robbery.” I was a few years ago a high-tariff man ; but after giving this ques- tion some study from the standpoint of the wage-worker, I came to the conclusion that protection failed to protect me, in the fact that 1 find my wages to-day are no greater than they were in panic times. In panic times I was paid $2.50 a day, and that is all I can get now. My house- rent is 60 per cent, greater to-day than it was then, and everything I have to purchase is higher priced than, then, with a few exceptions. I find that the coal I consumed last year was nearly three times as high as what I bought in the panic times. I also discovered that there were thousands of men idle in the mining towns, and clamoring for bread ; and yet a few men could meet in their back office and put up the price of coal to $9 at my door. These questions are now before the pe'ople — whether or not the nation can give special privileges to a few men to enrich themselves at the expense of the many. The labor organization I represent is a powerful and growing one. It is not a political organization yet. It has a platform, and in order to carry out that platform it must take political action. But, I assure you*, if it ever does grow large enough to take political action there will be a change made, so that our men can be put upon a level with other men. By Commissioner Boteler : Question. Prefacing my question with the assertion of belief that the man who does not work is not respectable, I ask this : If by a reduction of the tariff, or by the abolition of the tariff, we have free trade, the result of which, as we are assured by those who are in business throughout the country, will be to close the manufactories and make us dependent upon foreign countries for all we consume, do you think that the working- men of the country would be benefited by such a change as that? — An- swer. I will answer your question in this way : As wage- workers it don’t make any difference to us who gets our services — whether they are in Europe, in New York, or Albany. Q. But as I go through the manufactories of this wonderful city and see the workingmen employed — seeing them certainly better lodged than in any other part of the world — and then contemplate the contin- gency of these places being closed, as many of them were several years ago, and the workingmen thrown out of employment — and the most pitiful object in the world is a man seeking work and not being able to find it — do you think that condition would be a good one for this coun- try ? — A. No, sir; neither do I think that the abolition of the tariff would work a condition of that kind, because there are certain economical laws that lie at the base of this thiug that regulate it, and no legisla- tion can change it. It is a natural law, and so long as that condition exists, so long will we have the extremes of the Vanderbilt on one hand and the beggar on the other. Q. Do you think there is any natural law to induce a man to go into H. Mis. 6 66 1042 TARIFF COMMISSION. [O. A. BISHOP. manufacturing and invest liis capital unless it is profitable ? — A. In the first place, to induce a man to go into manufacturing there must be a demand for the wares he may be able to manufacture. Kow, that de- mand is made by the wants of the millions. Q. Then you desire to see no demand foi articles of American manu- facture? — A. I desire to see a greater demand. If $150 was put into my pocket now, and I was instructed to buy a piano, there would be a demand for a piano. By reducing the wages you reduce the consump- tion, and if you reduce the consumption you reduce the production, and that in turn throws others out of employment who are no longer con- sumers, and the tendency is to panic, as I stated in my paper. But re- verse the operation, and you set the mills humming. Give to each em- ploye all that he produces, and then he will be unable to consume all that every other employe produces, and hence he will be constantly coming in contact with new wants, and those new wants will have to be supplied. To-day the reverse is the condition. Commissioner Boteler. Every man in this land has the right to go where he pleases, to engage in whatever business he chooses, to farm or to labor in any way, and to have the results of that which he produces. He can get his lauds free; they cost him nothing. All that he has to do is to work upon that land, and he certainly has a right to ail the production of that land. He can work lor himself if he has a trade ; and if he can sell the product of his handicraft there is certainly nothing to prevent him enjoying all that he produces. The Witness. Well, sir, I admit that a man can go where he pleases in this country ; that is, if he has got the wherewithal to go ; but if he is situated as I am, with a family of eight, and trying to keep the family together, and get money enough to go West and find a farm, he will live a good many years before he will get out of the city. I have not been outside of the city of Chicago more than five miles in three years, and I am not a drinking man myself, and I don’t see any way I can get out without leaving my family. To tell me that there is a farm in the West for me is simply a mockery. I can’t go there. There was a wise measure introduced into Congress, three or four years ago, that would have enabled me and millions of others to go upon the land that belongs to us j but there were a few men there who were too wise to pass it. t R. BLAKESBY.] SORGHUM. 1043 R. BLAKESBY. Chicago, III., September 9, 1882. Mr. R. Blakesby, of Saint Paul, Minn., made the following state- ment: Gentlemen: I think I sent a paper to the Commission since its organization, which embraces mainly the heads of what I would say if I were prepared with a written paper on the subject. I come rather to answer questions than to make suggestions. The sorghum interest of our country is a new one. It is only, I may say, about five years old, and what has been developed has been against all preconceived notions in regard to it, against all experience, and against the judgment of our most scientific men. Notwithstanding, it has finally found an indorsement by men of science, men of practical skill, and has finally been considerably developed in our State. Our common farmers are making a very large amount of sirup, which is sold at about 40 cents a gallon. It is sold by wholesale in very considerable quantities. As a matter of course, we shall improve upon what we have had so far, because it requires some skill as well as practical knowledge and labor to grow the cane and manufacture the sirup. Our common farmers are not educated to the making of sugar. By the open-pan process of making sugar a very considerable degree of heat is necessary — from 240° to 245° F. That degree of heat destroys the sugar very rapidly, or inverts it, as we term it. A very large amount is virtually converted into glucose. Hence the common prac- tice of making our sirups and attempting to make sugar has not suc- ceeded. It is very often the case that persons enter into an industry with a little confidence, but soon find themselves at a standstill. Some of my neighbors had attempted the experiment of making sugar, but became a little disheartened from their experience with insufficient ma- chinery and other troubles, and I was finally appealed to, as having some confidence in it, to take hold of the venture, and did so. I have spent a little money for the last two years in attempting to prove the fact that sugar can be made from sorghum that would polarize from 9 to 15 per cent, of saccharine matter. Now, while I have done that, I do not speak of it except to illustrate the fact. It has not been successfully done, because the cane was not properly and successfully grown. Yet I have succeeded in making about 12 gallons of sirup from a ton of cane, and about 5 pounds of sugar from a gallon of sirup. It is altogether against the skill of these persons that that has been done ; it is in the face of our better judgment as to what we ought to have done; but it has challenged our admiration and our confidence in its final success. It is necessary that this industry shall have the kind consideration of the government, and, if it has, it will induce an investment of capital, not only by those of us who know it best, but by many others who know something about the sugar culture or manufacture. In a little experiment I made, with what I regarded as a necessity for making the experiment (steam vacuum pan, bone, and coal filtration for refining the sugar), with a poorly grown crop I succeeded in making, a year ago, five pounds of sugar to the gallon of sirup. This last year I 1044 TARIFF COMMISSION. [k. blakesby. had a very badly grown crop, and I did not attempt to crystallize the sirup. I should probably have made more this year, but got tired of waiting. 1 had to keep up steam in order to keep crystallizing it, and I finally dried out what sugar we had. We had 7,000 pounds of sugar, of which I have a specimen here, which I would be glad to show to the Commission, if they desire to see it. The industry has been the subject of but short experience, and has not resulted in anything like a commercial success. It still remains in the experimental stage, you may say. There has been sugar made by the farmer, but only a pound or two to the gallon, and it has not been made as it should be. The success so far does not justify anybody to expect anything but sirup. Last year in our State we had 7,700 acres of cane. This year there are between 8,000 and 9,000 acres. The cane, properly ground, ought to run on an average 125 gallons of sirup to the acre. That is, as a matter of course, as the farmers make it in open pans or in Cook’s evaporator, a poor yield compared with what it ought to be. The sirup that I made and sent to the market I got 30 cents a gallon for. It is exactly the counterpart of what used to be called the sugar-house syrups which we bought in Saint Louis ; I am very well acquainted with the process of making that. The only trouble is that' it is a new thing, and people are all afraid that there is something wrong about it. It requires no chemicals in its manufacture, but only the necessary skill and experience. My friends rather doubted my ability to make sugar from cornstalks, as they termed it. By Commissioner Garland : Question. Do you give the yield of 125 gallons to the acre as an aver- age ? — Answer. That should be an average of good cane properly grown. It may be grown more successfully, and more could be produced. It is rather an unpleasant thing to introduce to the attention of a commission like this, because it is only an experiment. It has only been experi- mented upon for a few years, and, I may say almost, that I am the only one who has succeeded in making sugar in my State from sorghum. I am the only one who has had a vacuum pan in which to make it. Large quantities of sorghum are made up into sirup in Kansas, Illinois,’ Wis- consin, and Minnesota ; but I do not know of anybody who has made merchantable sugar in any quantity except ourselves. By Commissioner Boteler : Q. From your experience, what amount per acre can be produced? — A. I will give you the limited amount of cane that grows per acre: we call it ten tons of cane to the acre. That ought to produce 120 gallons of sirup, weighing about 12 pounds to the gallon, and from 12 pounds of sirup we ought to get 5 pounds of sugar, if it is good cane and has been properly worked, leaving 7 pounds of sirup to be sold by whole- sale at about 50 cents a gallon. That involves, as a matter of course, a little more machinery and a little more care m manipulation than is commonly used in Louisiana. Louisiana people simply go through their process without a vacuum pan, and almost all of them, if I recollect, without the bone. But, K 1 am rightly informed, hardly any of them get sugar that will rate as high as this. I sent a specimen of this sugar to the Agricultural Department and asked them to return me a chemical analysis of it. They returned me a certified analysis that this sugar polarized 96 per cent. That is about as good as most any sugar we get nowadays, except granulated sugar. If I understand, the usual pro- duct is about 85 per cent.; I may be a little below the mark. R. BLAKESBY.] SORGHUM. 1045 Q. What is the best variety of cane? — A. We grow the thick-grow- ing cane, the Early Amber, because our season is short. I regret ex- ceedingly that the report of the Academy of Natural Sciences has not been printed, because it was the united opinion of the entire Academy that this stands next to the ribbon cane of Louisiana as a sugar pro- ducer; but on account of a little difference between the Commissioner and a committee of members of the Academy, it has not yet been printed. That is the opinion of men of the highest science in the country, and men who have given this subject some attention. Dr. Moore, an emi- nent chemist, laughed at us at first, but he has had to acknowledge that it is a sugar-producing plant. The doctor questioned whether we could make it for commercial purposes, but he has become convinced now that we can do it commercially, and he is, I believe, one of the best author- ities we have in the United States on sugar. By Commissioner Porter : Q. What is the relative cost of this sugar — for instance, that which polarizes so highly — compared with that made from sugar cane % — A. That is one of those things I could not possibly answer, for this reason: W T e have been making expensive experiments. Still, I regard it as practicable to make it a success. I think it is ample to insure that that industry shall be developed as the people acquire experience and skill; it is not everybody who can make it; and when it is once developed it will require its present protection to sustain it. By Commissioner Boteler : Q. Do you regard the present protection essential? — A. Oh, yes. I do not think it would be judicious to remove it. To make it a commer- cial success the person must grow the cane himself. He must be on the plantation. With 500 acres of land, the necessary apparatus to grind it and evaporate it, it can be made successful. Commissioner Porter. There have been a great many experiments in the last few years among farmers, and they may have produced a low grade of sugar ; I know in Minnesota and even in Iowa and other States they have been experimenting, and I suppose the farmers can produce a lower grade of sugar than this. The Witness. In the opeu-pan evaporation, when it is boiled down to about 12 pounds weight, it involves from 242° to 245° of heat, as I said in the early part of my remarks. Anything above 240° destroys the sugar, and the last five minutes that we boil destroys more sugar than is left. When our cane has been gathered properly, and we get a good man to boil it, he may get all the sugar in the sirup, a pound to two pounds to the gallon, but not often. But with the vacuum-pan process we ought to get whatever sugar there is, because we don’t destroy anything by our work. In our vacuum-pan process, after the sugar is reduced to about 25° saccharometer test — it has a large quantity of water at that time — we then pass it through the bone and coal. It then goes to the vacuum pan, and in that way never gets over about 140° of heat, and still that reduces the sirup. Q. Is the sugar being made by persons for their own use in the West at present ? — A. The open-pan process defeats the making of sugar, simply because it requires such a high degree of heat, which inverts and makes glucose of it instead of sugar. Every particle of glucose will defeat another particle of sugar and cause it to fail to crystallize. If one-half of it is glucose it will not crystallize at all. Q. That is your explanation of its failure ?— A. Yes, sir. 1046 TARIFF COMMISSION. [R. blakesby. By Commissioner Kenner : Q. Have you tlie proper machinery? — A. Yes. Q. How far is your place from Saint Paul ? — A. Forty miles, T sup- pose. I thiuk, perhaps, we have some authority for saying that the cli- mate of Minnesota develops saccharine matter more successfully than many other localities further south. It is my impression that it does. I believe our cane product^will polarize higher .than those of Illinois, Iowa, or Missouri. Still, I have not been'hble to test that successfully, for the reason that I have not been able to get their canes in season. Q. I understood you to say that this season there would be between 8,000 and 9,000 acres of this sorghum cultivated in Minnesota, and the reason why the most of this is not converted into sugar is from defects in machinery, and not from defects in the cane? — A. From defects in the machinery mainly — machinery and skill. The process which they use is not adapted to making sugar. Q. Will these 8,000 or 9,000 acres be converted into sirup? — A. Yes, sir; and it is all sold to the merchants. For instance, my neighbors make, by what is called Cook’s evaporator, sometimes as much as 50 barrels of sirup. Our principal wholesale men in Saint Paul buy that sirup clean, 40 or 50 barrels at a time, and they have always sold it to their customers. Q. What does the Cook evaporator cost? — A. From $200 to $500, according to the size. There are different sizes. Perhaps some may cost less than that. Q. To your knowledge, has any one failed to produce sirup out of sorghum? — A. Ko; there is no question about that. The only question is about the quality of it, and that depends largely upon the skill of the man who handles it, and upon the machinery. Q. Are you satisfied, after three years’ experience in the manufact- ure, that enough sugar can be made for home consumption ? — A. Yes, sir; I have no doubt of it. I have expressed that opinion to every one in conventions at home repeatedly. We have established that beyond question, I tl£nk. Q. Do you think, if the Western peoiffe would plant this sorghum and prepare the right kind of machinery for converting it into , sugar, that it can be done as profitably as to raise wheat and sell it and then take the money and buy sugar? — A. To grow an acre of this cane will cost as much as to grow an acre of corn. You are familiar with that. Q. Ko morel — A. Ko more; probably hardly as much altogether. It ought to be ground and worked by steam. Fuel to some extent ought to be the ground cane. I am convinced that I can raise fuel enough from the cane to work it, thus avoiding expense for fuel. As to the manipulation and the interest on investment of capital, I am sure that there is no question; it is going to make sugar, not only for ourselves, but for our neighbors and almost anybody. I want you all to understand that this is a commercial article, and 1 now show you some that was taken out of a quantity that I sold at 9 cents a pound, without furnishing the cask to put it in. Q. What would Louisiana sugar of about the same quality cost? — A. About 10 cents. I could have sold 100,000 pounds, if I had had it, just as well as what 1 did sell. Q. Are you sufficiently satisfied with your own success in its manu- facture ? — A. At this time it is entirely impracticable to work my fac- tory. There was a great deal of enthusiasm among my neighbors, and they were all going to grow cane and support this institution, but they R. 1JLAKESBY.] SORGHUM 1047 got scared a little at first, and I found difficulty in getting them to grow it and bring it in. The factory is in a town, and it was brought to me last year some 4 or 5 miles by fifty different persons. I wanted somebody to grow me 200 acres of this cane,, but 1 could not get it done, and so I said, “ Gentlemen, 1 think I must close up this establishment this year and let it stand, as I can’t get the cane here.” I succeeded, you understand, after an experiment by other parties who had lost confi- dence, and, against that experience and want of confidence on the part of others, we did succeed in making some sugar, very successfully, as I thought. Q. What sort of machinery do you use in making that sugar? — A. It is virtually the plant that was gotten up by the farmers in the first place. A very considerable amount of money was spent — I don’t know how much — and they got in debt and then told me, “If you will take this off our hands we will give you what we have spent.” It has cost me about $18,000. Commissioner Kenner. It must be very costly. The Witness. Well, it has cost too much money because it came from different localities and at an expense which would probably attend an effort to put up machinery complete and clean. It is capable of work- ing about 200 acres. It is perhaps not so complete as if a person skilled in this industry was to start out to make a plant to work the cane in time to come. By Commissioner Porter : Q. Do I understand you to say that this sugar is actually being sold? — A. I only mean that it has been manufactured commercially. Q. There is none of it for sale? — A. No; it has all been sold and eaten. There was only 7,000 pounds made. It was simply an experi- ment. Q. And that is the end of it?— A. We did not make enough to be talked about. The institution will be moved from where it is now to somewhere else ; it is only waiting. By Commissioner Ambler : Q. If I understand you, your present plant has the capacity of about 2,000 tons of cane a year ? — A. Yes, sir. Q. How many pounds of sugar would that make?— A. About 600 pounds of sugar to the acre, according to our experience ; but I do not think that is as successful as it ought to be. If we get men to work it who understand the business, there will be no trouble about it. By Commissioner Boteler: Q. I have seen some statements emanating from the Department of Agriculture in regard to making sugar from corn. Have you had any experience in that direction ? — A. No, sir ; the time that corn will bear working is so short in Minnesota that it would hardly be worth the effort. I think probably the statements that have been made are cor- rect, but it is hardly a practical industry. This cane may be worked with us, according to the ordinary season, for about forty-five to fifty days. 1048 TARIFF COMMISSION. [MARSHALL FIELD. MARSHALL FIELD. Chicago, III., September 9, 1882. Mr. Marshall Field, of the firm of Marshall Field & Co., importers of dry goods, Chicago, submitted the following statement: Gentlemen : I take pleasure in submitting to you some general views on the tariff question, together with some more specific ideas relating to the business in which I am engaged. I am for a liberal tariff, as I believe in encouraging home manufact- ures and home labor in every reasonable way. I am convinced, how- ever, that the present tariff is too high, not only for the good of the people, but for the good of the manufacturer. It should be reduced and thoroughly revised and simplified. As it stands it is unreasonable and unscientific, and is constantly defeating the very objects for which it has been framed. To illustrate my meaning : With a lower duty on articles of luxury, such as silks, velvets, ribbons, laces, kid gloves, fine shawls, and similar merchandise, not only would the government receive a greater revenue, but the American manufacturer would receive a better protection, as it would largely tend to prevent undervaluation and smuggling, and place the import business in this class of goods where it has never been — on an honest basis. To-day it is almost entirely in the hands of French- men and Germans, mostly aliens, and agents of foreign principals, and men who have no interest whatever in this country, save to make their fortunes in it, and then return to make their residence in Europe. An American merchant cannot go to the foreign markets and buy these goods for importation at the ruling foreign prices except at a ruinous loss. They are delivered in the United States to the agents I have men- tioned only in prices in American money, which is done to avoid estab- lishing a foreign market value. This is a business very hard to detect, and the American Government, with all the forces at its command, in the shape of consuls and special agents, has been unable to break it up. The temptation to undervaluation is of course the enormous duty, which insures a correspondingly large gain. I have spoken of a line of goods in which I have had personal experience. Doubtless the same state of affair* exists in other branches of trade. . I believe there should be a large reduction in the duty on all raw materials. I would not tax raw wool more than 15 per cent. This would make 35 to 40 per cent, a reasonable tax on manufactured woolen goods, such as carpets. I could not recommend a duty of over 25 per cent, on all manufactures of cotton and linen, nor over 35 to 40 per cent, on any manufactures of wool. Silks, velvets, ribbons, and laces manufact- ured from pure silk should pay about 35 per cent. ; and on piece silks and satins I recommend a specific duty by the pound weight that would yield an average rate of 35 to 40 per cent. 1 also recommend a specific duty by the dozeu pairs on kid gloves, and 1 suggest $3 per dozen as a fair rate, that would amply protect the cheap grades manufactured in this country, but would be reasonable on the finer grades, which we do not make at all. I am of opinion that the duty should be entirely abolished on all pack- ing charges, shipping charges, brokerages, aud commissions. In other MARSHALL FIELD.] DRY GOODS. 1 049 words, I believe that the dutiable value should be the wholesale price of the goods at the actual market i u which they are purchased. The compul- sory addition of these petty charges yields no considerable revenue, and entails incessant annoyance on the importer. For the same reason I recommend the abolition of all fees in connection with the payment of duties, and the privilege of making a general warehouse bond, instead of an individual bond on every consignment that is warehoused. I recommend the entire abolition of all mixed duties. Let the rate on an article be either specific or ad valorem, but do not mix them. The present classification of silks, cottons, and wools is remarkably involved. It should be simplified. In conclusion, I think the day is not far distant when all raw materials should be absolutely free, and that still further reductions on manufactured articles than those I have indicated, should be made, and these views are in no spirit of hostility to the manufacturer, but directly the oppo- site. Our tariff restricts American manufacturers almost entirely to the home market. With our cheap lands and cheap food, a steadily decreas- ing tariff would enable us to compete successfully with England for the trade of other countries, where she now has practically supreme coutrol, and where she will have as long as our present tariff laws are main- tained. By Commissioner Porter : Question. Would it meet your views if a uniform rate were made as charges and commissions? — Answer. No; I should recommend abol- ishing it entirely. Q. Would it not meet your views to have a uniform rate for both charges and commissions, and let that rate be universal ? Would not that simplify matters to some extent ?• — A. That would be an improvement over the present system, but I do not think the government needs rev- enue enough to make it pay at all. It is a great deal of annoyance and bother with very little revenue derived from it. Q. There is a certain expense in transporting goods from the sea- board, as well, as the inspection, &c., and you know better than I do that it would amount to a certain percentage. If that percentage was fixed bylaw, would it not be better? — A. Now there are no expenses other than the freight and office expeuses, if the business has been conducted properly. I would recommend its abolition entirely. Q. Do you think it practicable, instead of taking the consular invoice for the valuation, to have a home valuation, say, made in New York? — A. No sir; I do not think it is. By Commissioner Oliver: Q. Have you had any cause to complain of these valuations in different ports of entry, for instance, with the valuation of silks, or any item of • foreign dry goods? — A. No, sir. Q. Do you find that the appraisement is uniform generally? — A. So far as our knowledge goes, yes, sir. I cannot illustrate it better than to say this: that we have our offices in good shape in Manchester, England, and in Paris, and we buy nothing except for money; we have no bankers’ credits or anything of the kind. We have twenty-six departments, one department of silks and velvets, known as department 4. Our parties who manufacture silks and velvets hold between $400,000 and $500,000. Out of that $10,940 comes through our own office in England, and not a dollar of it from France or Germany. All of the balance, or nearly 1050 TARIFF COMMISSION. [MARSHALL FIELD. half a million dollars, comes through these sources I speak of. Many of these goods were ordered six months, and they are either here or over there, but billed to us in American money and delivered in New York to their agent, and their agent delivers them to us in New York. Q. They do their own importing, then; they invoice to themselves? — A. Yes; substantially. Q. Do they invoice at the prices you agree to pay them? — A. We know nothing about that ; we pay in American money. By Commissioner McMahon : Q. Is it not, with the means which the government has at its command for making investigations through special agents, and other inquiries, almost impossible to prove undervaluation? — A. Yes. The proof of the whole thing is the statement I make to you now about our own affairs, that I cannot purchase, and for live years we haven’t purchased, silks abroad, unless some special patterns. Q. As the head of one of the largest dry goods firms in your State, will you please tell us whether you are the agent for any particular manufacturers in this country or elsewhere ? — A. W e are not the agents of any manufacturer of silks; we are for one line only ; that is kid gloves. Q Can any other firm purchase kid gloves in this section of the country of that manufacture besides yourself? — A. No, sir; we are interested in the fabric, you might say. Q. Is not that a common practice throughout the civilized world ? — A. Yes ; I don’t deny that. Q. Is there anything that you can recommend for this assumed valu- ation (for it is not a true one, and you agree with me in that) other than the imposition of a specific duty? — A. No; I believe that is the real remedy. Q. We have had it repeatedly testified before us that there is an enormous undervaluation. I will say, in addition, that we have also had testimony that about one-third of the invoices passing through the New York custom-house, in certain kinds of goods, are advanced from time to time. Have you, in your business experience as an importer, known of excessive undervaluation ? — A. I cannot say that I have that I can prove. Q. Would you assume it to be a fact that because you can go into a store or shop and buy an article more cheaply of a man who is agent of that article, and therefore who alone can sell it, than a similar article can be purchased elsewhere therefore he is selling to you at a loss or that he is dishonest? — A. It may be conclusive that he invoiced them below the market value. I believe it thoroughly, if it continues from year to year. Q. The same kind of goods and the same value ? — A. Yes, sir. Q. Are there any other means, than by comparison with other goods, of determining the value? — A. No, sir; with reference to the question of kid glove.^ that Commissioner McMahon speaks of, we are the agents for one kina. They are all stamped on the other side. They are the three-button goods, which are invoiced at 57 francs, and nothing but what is stamped with the manufacturer’s name do we sell. The largest importer in this county, agent for another glove, gets out a certain quantity with the name of the manufacturer and calls them “ firsts,” and pays the same we do, 57 francs, but he gets out the great majority of those goods unstamped and calls them “ seconds” and “thirds.” When they come into this Country they are restamped, but I have never heard of any “thirds” being sold in this country. There are “ seconds” sold. DRY GOODS. MARSHALL FIELD.] 1051 I think a duty of so much per dozen might stop that business, and that it would be a great protection to the American manufacturer. By Commissioner Ambler : Q. Do you know the difference in the invoice price of these u seconds” and “ thirds” ? — A. The “ firsts” are invoiced at 57 francs, the u seconds” at 43 francs; I cannot say what the “thirds” are invoiced at, but I believe over 37 francs. I would not state that positively, however. Q. Sojnehow none of them seem to be below “ seconds.” — A. After they get here they improve in quality very much. By Commissioner Kenner : Q. The effect of the sea air, I suppose? — A. Yes, sir. By Commissioner McMahon : Q. We have had recommended an extension of the ten days under the immediate transportation act to thirty. Do you favor that ? — A. Most decidedly. Q. Why ? — A. Because it gives a chance to save expense. It does not favor us personally ; but I think it ought to be done. If the im- porter is short of an invoice, or the goocls are shipped before the in- voice, it makes a good deal of bother. I see no reason why the interior ports should not have the same consideration that sea-ports have. But for myself I do not care, although I think for the good of the many it should be changed. Q. He also recommended that the ten-day limit for the publication of notice of liquidation be extended to thirty. Do you favor that ? — A. I should think so. I do not see any objection to it. Q. Have you ever heard of any case where goods imported to Chicago under the immediate transportation act were reshipped to New York and sold at a profit ? — A.. No, sir. By Commissioner Oliver : Q. I understand that your house is the largest dry-goods establish- ment in the country outside of New York. Am I right iu that ? — A. I presume you are, and there is only one in New York that is ahead. Q. I understand you to say that although you have a regularly or- ganized house, both in England and in France, and although your house is in the markets of England, France, and Germany, where you can personally select and buy goods, after you select and buy them and pay for them, then it is impossible for you to import them. — A. On the class of goods I speak of, we can bring them here if we pay for them. This season we have had no trouble that I know of in regard to cashmeres. There has been great trouble in French goods, and when real laces were worn a few years ago. They have been out of fashion a few years, but they are coming back again, and I expect to hear the same story again. Anything that pays 60 per cent, duty, even the fine character of goods, is subject to the same trouble most of the time. Q. You recommend specific instead of ad valorem duties? — A. Yes; but I recommend a lower tariff. Q. Do you think it practicable to have specific duties, on silks, say ? — A. Yes; and make it per pound, too — duty by weight, and then the people would get better value for their money. Q. At your leisure, as soon as possible, will you make a recommenda- tion of changes from ad valorem to specific duty, and designate the line of goods that you are acquainted with? — A. Now, you strike a very difficult thing, and a thing that requires a great deal of time. 1052 TARIFF COMMISSION. [MARSHALL FIELD. Q. But you are the man who has the experience. — A. I should not want anything else to do for about the next six months to go into that. Q. That is true; but from the trouble you have told us there is in your business, is there anything of more importance to yon, and men like you, than that ? — A. I grant that that is true. It is of vast importance to us, to manufacturers, and to the whole country. Q. Then I think we are right in requesting that you help us ? — A. 1 should not like to promise. I will assist anybody as far as I can; but as to taking the responsibility of anything of the sort, I could not do it. There is no end to it, as you all know, if you get started. A. H. REEVES.] GOLD LEAF. 1053 A. H. REEVES. Chicago, III., September 9, 1882. Mr. A. H. Reeyes, of Chicago, gold-leaf manufacturer, addressed the Commission as follows : I speak in the interest of increased protection on gold leaf. The duty is not sufficient to protect our employes. We have reduced the wages within the past four months about $2 a week, so that our employes can scarcely get a livelihood out of it, and it is now right down to the cost of importation. 1 understand the case has been presented to you in the Eastern cities, but we also wish to have Chicago represented. We are young men from the Eastern cities, have some 100 or 125 employes, and it is very difficult for them to make a living in the gold and silver leaf business. It was intimated to me that one manufacturer in Philadelphia objected to an increase of duty, because it would iucite people to smuggle. I think the argument is very weak. We are speaking simply in the in- terest of toiling men and women. Our employes are about equally divided between male and female help. The present duty is $1.50 per jmckage of 500 leaves, 3§ inches square. The purity of the commodity is 23 carats fine. It cannot be adulter- ated either for or against, so that, as far as quality is concerned, one country has no benefit over another whatever, either in quantity or in the size of the leaves. It is just a matter of labor, no matter how much is produced. It is simply as between European labor and American labor. On the schedule it is marked at $1.50 per jjackage. We would like it increased 50 cents a package, equivalent to about 9 or 10 per cent. By Commissioner Garland : Question. What proportion of the price of gold leaf is represented by the labor? — Answer. Nearly 40 per cent. In England they are work- ing for about 45 or 50 per cent, of what they are here; and in Germany about 65 per cent, cheaper. By Commissioner Ambler : Q. When you say 65 per cent., do you mean the price of labor here is 65 per cent, below, or 35 per cent, below ? Answer. [By Mr. H. Horn.] The price of labor there is 35 cents on the dollar of what we pay here. We cannot get a genteel boy to go into our employ; there is not sufficient incentive. I do not consider it fair on my part to ask a boy to learn the trade. Q. I understand that you followed the same business in Germany? — A. Yes, sir. Mr. A. H. Reeyes. They can place the material cheaper in New York with the duty on than we can produce it. To meet that, our em- ployes, the gold-beaters, have been reduced for the last six months in their wages from $2 to $3 a week. There has been a large advance in the prices of what they consume and what they wear, as well as in the rentals of houses they live in. 1054 TARIFF COMMISSION. [A H. reeves. Mr. lleeves then submitted the following paper: Chicago, September 9, 1882. To the honorable Tariff Commission : Gentlemen : The undersigned, manufacturers of gold and silver leaf of the city of Chicago, respectfully ask the members of this Commission to advocate an advance of the duty on gold leaf of 50 cents per package of 500 leaves, and in regard to silver leaf we would suggest to make no alteratiou, hut leave the duty as it is. We recommend this advance of duty for the following reasons: In the production of gold leaf the labor represents 33 per cent, of the marked sale price, and in silver leaf 50 per cent., and as labor is in England 50 per cent, lower and in Germany about 65 per cent, lower than in the United States, we need this tariff to enable us to pay our workmen living wages. Very respectfully, A. H. PEEVES. H. HORN. JULIUS HESS. JOHN W. HINTON. ] BARLEY, FLAX, ETC. 1055 JOHN W. HINTON. Milwaukee, Wis., September 11, 1882. John W. Hinton, of Milwaukee, appeared before the Commission and stated as follows : Mr. President and Gentlemen: You are in a city as much de- pendent upon a judicious tariff as any city in the Union, from the fact that our geographical position precludes the possibility of our ever be- coming a mercantile or (in the common acceptance of the term) a com- mercial city of any magnitude. Scarcely any better evidence of that can be given than by referring to a gentleman no longer living, but whose name will go down to posterity highly honored and gratefully cherished in connection with the great industries of the Northwest — iron and lumber — a man second to none that this or any other country ever produced. Mr. E. B. Ward, of Michigan, was the founder of what we call here the Bay View Iron Works, to which you gentlemen have been invited to make a trip some time during the day. At his unfor- tunate death we had just a taste of the rich feast in store for us by the prospective developments of other manufactures, had he lived to carry them out. It does not become me to say anything about iron. You will have that matter presented to you by men who know all about it. But I mention this simply to show that here we are largely dependent upon a judicious tariff. THE BARLEY QUESTION AND THE FARMERS. Lately the question has arisen among our farmers as to the peculiar relations between the duty upon barley and the duty upon barley malt, and I find that it is taking such a hold on the farmers in a number of places in this State suitable for the growth of b,arley that they have already prepared petitions to be sent to their members of Congress, and in one part of the State, where there is a large Republican majority, they have concluded to run a Democratic member because he has thoroughly taken hold of the barley question, which is a serious matter for those farmers. Now, while in no sense speaking for the brewers of Milwaukee, who are perfectly competent to speak for themselves, it is perhaps well enough to remind you that they paid last year over $800,000 to the gov- ernment as duty upon beer which they sold. They have been some- what plain, as 1 am told, in their expressions in favor of a lower duty upon barley, and they have had to some extent the support of several of our papers, very wrongfully, under the impression that Wisconsin could not raise good barley. They claimed that barley should come in from Canada free, and the brewers claim that if they could get it free beer would be much cheaper. I give you this fact as oue very promi- nent, and one that is being discussed to a great extent among the farmers of Wisconsin at this time. I doubt whether any person repre- senting the agricultural interests solely will appear before you in this citj r , and so I have taken the liberty of stating those facts to you. 105G TARIFF COMMISSION. [JOHN \V. HINTON. THE FLAX AND JUTE QUESTION. Now, gentlemen, there is another thing in which Milwaukee is par- ticularly interested. Within the last three months — I will say four months to be positively sure — there have been several gentlemen visit- ing Milwaukee. They were much delighted with its locality and per- fectly satisfied with the peaceable, quiet character of its laborers gen- erally. Perhaps almost two-thirds of this city is German. They are a very peaceable, industrious, and provident class of people. Those gen- tlemen came here for the purpose, if possible, of utilizing the immense amount of flax straw which is annually burned as perfectly useless. I think in Racine, which is the second city in population in the State, and the first in manufactures, if we omit the iron works which are on the out- side of Milwaukee, there is quite an amount of flax straw used, but only for stuffing mattresses and cushions for railroad-car seats, and I think I am right in stating that Racine is the only place in this State where it is utilized to any extent. We all know that every year there are 150,000 to 160,000, and in some years 200,000, tons of flax straw burned in Iowa alone. Now, these gentlemen came and conversed with a great many farmers and others. They state that if there was a higher duty upon jute, then this great product of flax straw could be utilized, and would be the means of establishing manufactures in the Northwest for the making of the coarser kinds of bagging, suitable for cotton bales, bags for roots, and the like. In conversing the other day with a gentleman here, who runs the only bag factory that we have in the city, he told me that the great difficulty he has to contend with is that every now and then he comes very near committing perjury and stands in some fear of an officer appearing to arrest him because he has to swear that the bags are made of burlaps that have paid duty. He has to make affida- vit to what is termed a drawback certificate, and, as he said, he thought it was a kind of grab game to get a little money back out of the Treas- ury of the United States. The proprietor and foreman of flour and bag factories have to severally swear “that the flour bags described in the within entry were manufactured at (blank) wholly from burlaps of the growth and production of a foreign country, imported, and on which the duties have been paid, as in said entry stated, to the best of our knowledge and belief.” He told me that those affidavits were made without absolute certainty as to the truthfulness in every particular. The flour and other manufacturers should have the right to buy their bags here, made out of material raised here by free labor, instead of by the Hindoos, who work for from 7 to 12 cents a day. That gentleman said to me that nothing would benefit the business more than for others to come here to Milwaukee and to establish similar factories, but at present they have to import all the material to make export bags from, which necessitates the carrying of an unusual quantity of stock, while at the seaboard the foreign manufacturer carries the stock in bond, and allows the bag manufacturers to draw the material as required for daily use. GLASS FACTORIES. There is another little thing. We have down in Bay View three glass factories. Two have been consolidated into one lately. The complaint from one gentleman who recently sold out there was this : That the duty upon the bottles — I am only giving you his statement — was virtually higher than upon soda ash, which is the principal material of any value entering into the manufacture of glass, and he gave that as one reason JOHN W. HINTON.] BARLEY, FLAX, ETC. 1057 why lie sold his works. Upon further inquiry I found that they had about 120,000 to, I think, 150,000 gross of beer bottles left on hand, which they could not sell except at a dead loss, owing to the terrible competition of glass bottles made in Germany. The beer-bottling busi- ness in this city is marvelous. You will see sometimes four or five cars loaded with nothing but packages of bottled beer. It goes to Texas, to Mexico, to Cuba and the other West India Islands, and I do not know where it does not go. Of course they use an immense number of bot- tles, and if the duty was higher upon soda ash it would serve to en- courage the manufacture of soda ash in this country, for I believe there is none made here. Or if it was taken oft* entirely and a higher duty placed upon bottles there would be some show here at least. (You will observe that I confine my remarks to local matters entirely.) It cer- tainly would induce many more bottle factories to start here, or would surely make the present establishments more profitable. There is still one other little thing which is somewhat peculiar and may be of interest. I have within the last four months incidentally gone around to over thirty drug stores, and have obtained positive proof that the retail price of quinine has not varied one cent for ten years. MILWAUKEE AS A MANUFACTURING CITY. I do not wish to detain you with any lengthy harangue, but as I said at first, you will find no city more dependent upon a judicious tariff than Milwaukee. We have labor here unlimited and of the most peaceable and provident character. We have a few large factories here of differ- ent kinds; for instance, the willow works. Wages here have remained steady, and with the exception of the cigar strike we have rarely had any trouble. We had a sort of a half-way strike down at Bay View, but the men went into it reluctantly and only in obedience to the de- mands of an association to which they were attached. They have great confidence in the president of that company, whom some of you gentle- men may know, because he asserted at the great meeting of the iron aud steel manufacturers of 1878 that the true aim of the tariff was not to benefit the manufacturers alone, but that it was to share its benefits with the quarriers of stone, the miners of coal, and the diggers of iron ore, and all who labored; that it was to be like the dew of heaven, to fall on and bless every one that labored. For this reason we have got down there a very peaceable, quiet, well disposed neighborhood, where 1,700 men are employed in the iron works alone, and often $90,000 paid out monthly for labor. After a residence of over thirty-nine years in Wisconsin, most of the time in Milwaukee, I can assure you that you can find no other city in the United States where for seven successive election days not a solitary riot has occurred, and in four of them not a single man has been arrested for disorderly conduct. Our people are of that character who live by their labor. There are more working men in Milwaukee owning their own homes proportionately to the population than in any other city in the world. By Commissioner Underwood: Question. Is this country well suited to the production of barley? — Answer. I only judge, as I said, from what I have heard from the brew- ers and farmers. As I understand it, the brewers very much prefer barley that has not been discolored by exjmsure to the air. All of the barley, or nearly all, laised in this State is sold here. If the barley is discolored by exposure to the air it discolors the beer and affects its H. Mis. G G7 1058 TARIFF COMMISSION. [JOHN W. HINTON. sale. I think that is the only objection to the barley grown in this country. Q. Then you would suggest that barley be protected ? — A. Yes. sir ; decidedly, and I am sure that I am uttering the voice of every farmer in Wisconsin. I have no hesitation in saying that. Q. Do you think that this great agricultural region of the Northwest could raise as much barley as would be needed in this country ? — A. There is no question about it. Q. We have had it stated before us that perhaps your barley is of an inferior quality to the Canadian barley. I have my own views upon that subject; but I wanted to know whether you can grow it in suffi- cient quantity ? — A. I do not wish to take up your time, but I will tell you what was told me by a gentleman ; I would not like to disclose his name. He told me that with labor so much cheaper in Canada the facilities were such that it is only quite recently that they had started a malt establishment here and in Chicago. There is an aversion on the part of the American farmers to raise barley. It is unpleasant to han- dle. The Canadian farmers do not seem to be so thin-skinned, and they handle it to better advantage. The Scotchmen in this country who have been familiar with the raising of it seem to understand it bet- ter. But this gentleman told me that whenever he could get Wiscon- sin barley that was clear and not discolored by exposure to the air he would as soon have it as any barley ever raised. Q. It only requires a little more care in handling ? — A. That is what he says. By Commissioner McMahon : Q. Is this discoloration owing to any difference in the climate of Can- ada and that of this section, or to the manipulation of the crop ? — A. I really don’t know. Q. Is it handled more promptly there? — A. I have heard that ex- plained in this way: The Canadian farmer, owing to the claim that is made that the Canadian barley is better than the American barley, and to insure a market in the United States, has paid more attention to raising it and harvesting it quickly. Now t , this gentleman, to whom I have referred, stated that if the barley in this State was harvested with the same care that it is in Canada (that is, giving it the preference over other grains, because it is liable to discoloration from exposure), he thought the barley raised here equally as good. I do not know that of my own knowledge. MILWAUKEE AS A WHEAT MARKET. By the President : Q. What is the position of Milwaukee as a center for the distribution of wheat, or what has it been, compared with other cities here or abroad ? — A. Milwaukee for several years was the greatest wheat mar- ket in the world, very largely surpassing even Odessa ; but within a few years Chicago seems to have taken a good deal of it from us. And dur- ing the time that Milwaukee was that great and all-absorbing wheat market — I say this of my own knowledge — it was next to impossible to get anybody to turn his attention to manufactures in this city. And I think I am stating a fact well known to other gentlemen in Milwau- kee, that as the wheat market has declined manufacturing has in- creased. Q. I have heard the statement made, I do not know where, that great JOHN W. HINTON.] BAELEY, FLAX, ETC. 1059 as Milwaukee was as a wheat market, the manufactures of Milwaukee were more important or contributed more to the growth and support of the city than the total wheat trade? — A. That is unquestionably so, from the fact that a mere handful of men are engaged in wheat, while large numbers are engaged in manufactures. The president of the Chicago, Milwaukee and Saint Paul Railroad, whom we hear spoken of as the richest single banker in the Union, is largely interested in Mil- waukee. He has built two very elegant buildings, which you will see bye and bye; and I heard from his own lips that when the presidency of that road was tendered to him he would accept it upon no other condi tion than that Milwaukee should not be asked for a single cent, nor should the road do anything to injure Milwaukee, and through his individual efforts, as 1 understand, it is that those huge railway works in the Me- nomonee Valley, employing perhaps, all told, 1,400 or 1,500 men, have been erected. So that, in speaking of whether the wheat business has bene- fited Milwaukee as much as manufacturing, you have to divide that question. Very much of what I have just stated was due to the per- sonal efforts of Mr. Mitchell to benefit the city in which he lives, and you are perhaps aware that he was prominent as a signer of the remon- strance against the reduction of the duty on steel rails, and if my mem- ory is right, I think every railroad in the United States, except those more or less influenced by British capital, was also against it. It takes 72.000 to 74,000 cars to draw the material to the Bay View works and to draw the manufactured product from them every year. The trinity of these works together, in South Chicago, North Chicago, and at Bay View, require about 410,000 cars to draw the material to the mills and to draw the manufactured articles from them. Q. In other words, railroads are more benefited by the business which the manufacturers give them than they could be by having the duty taken off steel rails, &c? — A. Unquestionably, from the fact that those 410.000 cars could empty Iowa and Minnesota in a little while of their agricultural products, if kept running. Iron and steel and other indus- trial works are kept running the year round, while grain is only moved in a part of the season. By Commissioner Boteler : Q. You say you have lived here how long ? — A. I have been in the United States nearly forty-five years, and I have lived in this State thirty -nine .years last June. Q. Of course you are familiar with the growth of the State and its character. I have been very much impressed with what I have seen in these lakeside cities of the Northwest, and with the flourishing appear- ance of the farms on the route we have come. From your knowledge of this country and its products, do you attribute any considerable degree of the prosperity of this region to the present tariff law? — A. Yes, sir, 1 do, without any hesitation whatever. Q. In what degree ? — A. I cannot specify the degree. Racine, as I said, is the second city in population in the State and the first in man- ufactures, if we exclude the iron manufactories upon our southern limits. Now, the two villages of Kenosha and Racine grew for years not at all. They were emphatically dead until manufactures started. There is one manufactory there that pays from $2,500 to $3,000 per year for postage stamps alone, and has between 700 and 800 agencies established all over the States (J. I. Case & Co.). They have the largest thrashing-machine works in the world, employing 700 persons. There are other large man- ufactories there. The inhabitants of those places are all consumers and 1060 TARIFF COMMISSION. [JOHN W. HINTON. not producers. Yon can see the mechanics leaving off work a little earlier on Saturday, and you see their wives wheeling the babies around in the best baby-carriages that are made. They have the idea, and they live up to it, that a mechanic’s child has a right to ride in as good a car- riage as any other man’s child. They are great consumers of bread, po- tatoes, vegetables, meat, and everything else the farmers raise. They are great consumers of the best of everything. At Milwaukee we have about 135,000 inhabitants ; that is, I suppose, as near as it can begot at, and they are non-producers, but are all consumers of food. Q. Your idea is that the agricultural interest is benefited by the es- tablishment of manufactures 1? — A. Unquestionably. Q. You have such easy access to Canada, would it not be a great ad- vantage to have the barriers broken down in order to get the products of Canada at a cheaper rate than now?— A. No, sir; not a bit of it. With the tariff* off, Canada can feed all the Eastern manufacturing States. In 1881 Canada sent us $1,200,000 worth of eggs alone. There is no tariff on eggs, it is true, but from the fact that other things have a tariff* on them, our trade here is very large. We ship to the East an immense amount of flour, potatoes, meat, and all other agricultural pro- ducts. Q. From what you say, you do not believe that we should put our- selves entirely within the control of any foreign power in regard to our trade ? — A. No, sir ; I believe America was made for the Americans. That was the idea I had when I came to this country, and I cling to it yet. I thank you, gentlemen, for the opportunity of placing before you a few ideas as to how Milwaukee and Wisconsin are benefited by the tariff*. CUSTOMS LAWS. 1061 A. W. HALL. Milwaukee, Wis., September 11, 1882. Mr. A. W. Hall, collector of the port of Milwaukee, made the follow- ing statement: I did not come before you for the purpose of making any suggestions, but merely called to state what is being done here in Milwaukee. Of course, if 1 were to suggest anything, my suggestions, as collector of this port, would be iu the line of a practical enforcement of the tariff laws. The only points that occur to me without any previous thought on the subject are with reference to a simplification of the laws as they now exist, so far as their practical enforcement is concerned. For instance, the question of mixed goods should have consideration. These matters have all been thoroughly considered and discussed many a time, I pre- sume, before the Commission. The questions of component materials, chief value, &c., whether goods are of silk, cotton, or worsted, or partly of glass, ought to be considered, and also whether some simplification of the present law cannot be devised. That is about the only thought that occurs to me now. The question of extending the time for immediate transportation from the east to the west might, perhaps, be worthy of thought, and it has been suggested, I see, that the ten-day limit be extended to thirty. So far as we are concerned here, we have had no practical difficulty, and there have been no complaints here. The ten days, so far as I kuow, have been all that our importers here have been disposed to require. By Commissioner McMahon : Question. We have had quite general testimony from customs experts and from importers that the addition of charges and commissions is a source of annoyance to both the government and the merchant. What is your experience ? — Answer. That is our experience here. It has been a great deal of annoyance, and a great many times merchants have been unable to say, because they do not know, what the charges are from the place of purchase to the place of shipment, and the law, as it stands, en- tails quite a severe penalty if those charges are not embraced in the entry. Very often, unwittingly, importers are led into incurring penal- ties by some entirely unintentional oversight. I should think the law might be changed iu that respect. The revenue derived from duty on those charges is very slight, and it costs more to collect it than it is worth. I should be in favor of abolishing the whole thing. Let a man pay on wliat his goods cost him, and do away with all fictitious costs and charges. Q. Have you had any complaints on the part of the merchants here that their failure to protest or appeal in time has been owing to igno- rance of the date of notice of liquidation ? — A. Yes, sir. Q. Would you recommend, then, that the time for protest be limited to a certain date from the receipt of notice of liquidation by the im- porter, as in the case of advanced value, for instance 1 ? There the mer- chant has twenty -four hours from the date of receipt of notice to make appraisement. Would you recommend a corresponding notice from the date of receipt of notice of liquidation "? — A. Yes, I would. The date of 1062 TARIFF COMMISSION. [A. W. HALL. notice of liquidation is supposed to be the date that the notice is posted in the custom-house. Q. I mean to say the date of receipt of notice making it obligatory on the collector to issue notice of liquid atiou to the importer, just as lie is now obliged to issue notice of advanced value to the importer ? — A. Yes ; I think that liquidation should be an actual notice brought home directly to the importer, instead of it being, as it now is, a notice posted up in the custom-house. I think it should be mailed to him. Q. We have had it recommended to us that, in consequence of the varied decisions of the Treasury Department and the mass of work cast upon it from the different sections of the country, at a place where they cannot be practically familiar with merchandise, instead of the appeal being taken to the Secretary of the Treasury, an appeal be had to a board or court of experts to be located, say, at New York City, and that their decision as to classification be final and conclusive. What is your judgment of such a suggestion as that? The Witness. Without any appeal to the Secretary of the Treasury whatever ? Commissioner McMahon. Yes; that is to say, that if the protest shall be lodged within, say, ten days, after the date of the receipt of the notice by the importer of the liquidation, the collector shall entertain and act upon that protest. Of course, if he acts favorably to the importer, that is the end of it; if adversely, however, then the importer shall appeal to this board of experts. A. I think that would be a good idea. I had not thought of that before. Q. What is your idea of doing away with all the petty fees? — A. I should be decidedly in favor of that. Q. What is your idea in regard to allowing a man to give a general bond, either store bond or wharf bond or warehousing bond, up to the amount in which his sureties justify, without subjecting him to the giving of separate bonds for every separate importation ? — A. I should think it would be perfectly safe. I should think it would be sufficient to have one general bond to cover all transactions. Q. Do you see any objection to doing away altogether with consular certificates upon goods which are free of duty, or which are subject to specific duties only ? — A. None at all. I cannot see any necessity of consular certificates in such cases. Q. Whether for immediate transportation or not ? — A. No. Where it is a question of value, that is the only case in which I can see any reason for consular certificates. Q. Can you suggest any better method than that now made lawful for reappraisement? It has been said that complaint has been made by importers that the merchant appraiser, being appointed by the col- lector, and assuming the duties of general appraiser (and the merchant appraiser being often a manufacturer), the importer has not a fair chance. Can you suggest any fairer method of conducting the appraisement ? — A. No; we have very few reappraisemeuts here; but in theory I can- not see any improvement on that. So far as the practice goes, I know very little about it. Q. It has been suggested that the collector appoint one merchant, the importer select another, and those two select a third, and that the three should decide the matter. — A. That might do. By Commissioner Ampler : Q. On this question of charges and the inconvenience of adjustment, A. \V. HALL.] CUSTOMS LAWS. 1063 &e., to which you have referred, could not that he readily remedied by adopting a given rate to cover charges"? The Witness. A. uniform rate ? Commissioner Ambler. Yes. The Witness. In the way of a percentage ? Commissioner Ambler. Yes. The Witness. Possibly. Q. At present, for instance, the commissions are substantially settled that way ; that is, it is not less than 2 and I suppose it is never more. — A. Oh, yes; it is frequently more. Q. Suppose you should adopt some given percentage to cover the in- land freights and general charges that are now made, would not that relieve the difficulty you complain of in the adjustment and distribution of the charges ? — A. If it would be possible to do it, but I cannot see that it is practicable. It would have to depend upon the distance, would it not, that the goods are carried inlaud ? Commissioner Ambler. Of course it would have to be to some ex- tent arbitrary, but could not a rate be fixed that would be substantially equitable 1 The Witness. So much per mile? Commissioner Ambler. Oh, no ; so much as a general percentage to cover all duties and charges, including commissions and everything else. The Witness. In that case your charges would be the same for 10 miles that they would be for 100 miles. Commissioner Ambler. Certainly, and you have to adopt an average rate*. Your proposition, as I understand your answer to Mr. McMahon, is to do away with the charges entirely as a subject-matter of duty. A. Yes. Q. In that event, as a matter of course, you would give an advantage to the farther importer; that is, taking the present system as a stand- ard. Now, ascertaining some equitable percentage that would cover the average of those charges, there would be no inconvenience in the use of that plan in the custom-house, would there ? — A. None at all, practically. Q. So that it would relieve the difficulty you have suggested"? — A. Yes. Q. Your only objection would be that it might perhaps operate in- equitably because of the difference in the charges for inland freights "? — A. Yes. Q. Are you able to give us anything like an idea as to what the range of difference in those charges would be in collections at this port ? — A. No, I am not. By Commissioner Underwood : Q. I understand you to say that you are in favor of abolishing these charges and commissions, and you gave as a reason that it was incon- venient, and cost more than the amount collected. — A. It was fees I I spoke of that cost more to collect than they came to. Q. My idea is that the force of the custom-house collects the duties, and that these commissions and charges for transportation are added to the price of the goods and to the duties laid upon the price of the goods ? — A. Yes. Q. Is there any particular sum paid for the collecting of the duty upon the 2£ per cent, and the charges ? — A. Not for that particular ob- ject, no; but it requires, of course, more clerical help in the custom- house. 1064 TARIFF COMMISSION. [A. W. HALL. Q. Do you think it would diminish the number of employes in the custom-house ? — A. I think so. Q. If the commissions are 2J per cent, and the charges equal that, making 5 per cent., would not that amount to 5 per cent, of the whole duties collected under the tariff 1 ? — A. Oh, no. Q. Why not ? — A. It would amount to 5 per cent, on the goods which pay ad valorem duty. Q. Or a compound duty ; it would either be an ad valorem duty or a compound? — A. Yes. Q. Now, what proportion do they bear to the dutiable goods imported into the United States ? — A. I don’t know. Q. You are the collector; what is it here? — A. I should think it was fully one-half. Q. And that would reduce it to per cent, upon the amount of rev- enue derived ? — A. Yes. Q. About what sum would that be? — A. I am not prepared to say. Q. What is the sum that it costs the government to collect the duties on imports ? What is the whole revenue raised at present ? — A. I think it is about 3 per cent. Q. If it was 2J upon half of it, it would amount to a considerable sum, I presume; there are 1,200 officers in the custom-house in Yew York ? — A. I don’t know that any statement has ever been made. I haven’t seen any. By Commissioner Ambler: Q. The additional expense of collecting a fixed rate of charges and com- missions would be nothing ? — A. Nothing. By Commissioner McMahon : Q. The practical difficulty, as I understand you, is in the distribution of the charges, which vary? — A. Yes, sir; they vary through the different portions of an invoice. Q. The addition of the commissions is a simple matter ; it is the dis- tribution of the charges ? — A. Yes, sir. By Commissioner Ambler : Q. As I understand, that would be entirely relieved by fixing the percentage? — A. Oh, yes ; if it could be certain, it would be a great re- lief and would be a practical help to the custom-house officers. By Commissioner McMahon : Q. And a certainty to the importer as well ? — A. Yes. Q. Have you any experience here in the seizure of goods? — A. Some- what. Q. Have you been able to convict anybody of wilful intent to defraud since the passage of the anti-moiety act of June, 1874 ? — A. No. Q. Would you recommend the abolition of that section ? — A. I would, most decidedly. Q. Would you recommend a recurrence to the old practice of giving the informer a certain percentage ? — A. I think I would. Q. Provided the law remains as it is — that the duty shall attach to the actual charges — would you recommend the abolition of that section in the anti-moiety act which provides for the duplication of the omitted charges, or would you let it remain as it is ? Have you had any cases in which you do not double, and other cases in which you do double under the ruling of the Attorney-General ? — A. Yes; we have had. I do not a. w. HALL.1 CUSTOMS LAWS. 3065 think I would be in favor of retaining that. I think I would recom- mend the abolition of that 100 per cent, penalty. Q. Suppose the law remains as it is in regard to the taking of an ap- peal to the Secretary of the Treasury, would you recommend that it be made a matter of law rather than regulation that the collector be obliged to decide upon a protest? — A. Yes, I would. Q. The Supreme Court hasdecided that a withdrawal is a liquidation ; have you experienced any difficulty in ascertaining the proper rate of duty under protest, in consequence of that decision? — A. No; 1 have had no experience. By Commissioner Oliver: Q,. Have you had to reappraise many invoices of goods, or do you generally find the consular invoices correct? — A. We have quite fre- quently made advances on consular invoices. Q. Are you in the habit of sending samples to, or getting informa- tion from, the larger custom-houses, say New York and Boston, in re- gard to values, and also in regard to fabrics ? — A. No, sir; in regard to fabrics we usually get samples from the consuls. Under the present law they send samples with the invoices. Q. It has been stated to the Commission that goods have been im- ported into the western ports (not Milwaukee) and then reshipped for sale to New York. Have you beard of any such cases? — A. No; I have never heard of any such case here. Q. The idea would be that the the consular invoices are more readily accepted in some western ports at prices much lower than they would be in Boston, New York, or Philadelphia. The Witness. What class of goods ? Commissioner Oliver. I think the items were cloth goods and kid gloves. A. We have very few importations of kid gloves at this port. Q. Is business increasing under the immediate-transportation act ? — A. It is; there was about 20 per cent, more last year than the previous year. Q. Are any of your importers in Milwaukee agents, so far as you know, for houses abroad ? A. No, I do not know of any. Commissioner Oliver. I will suggest to the collector that, in look- ing over the law, if he can suggest any changes, he advise us. The Witness. I shall be very glad to do so. 1066 TARIFF COMMISSION. [D. W. BLANCHARD. D. W. BLANCHABD. Milwaukee, Wis., September 11, 1882. D. W. Blanchard, president of the Box Biver Iron Company, resid- ing in Milwaukee, addressed the Commission as follows : I want to say a word in reference to what Mr. Hinton has stated about barley. There are a number of farmers who live near me who have brought in barley to the beer makers in Milwaukee. A few days ago one of them told me that he had about 500 bushels of barley on his farm, a sample of which he had brought in to one of the brewers here, who looked at it and said to him, “Mr. Brown, you did not raise such barley as that, did you?” Mr. Brown replied, “Yes, I have got it at home put up safe.” The brewer said to him, “Then don’t you go any- where else with your barley, but bring it to me. It is the best barley I have ever seen in Wisconsin or anywhere else. I want the whole of it.” I would like to mention also that I am interested in the manufacture of pig iron, and have been for twelve years, at Napier, Wis., although it is not very profitable at present. We should feel very bad, however, if the tariff should be touched. We think it ought to remain as it is. One gentleman was telling me about manufacturing iron in the Southern States. Perhaps -they do not need the tariff there so much as we do in the North. We still want it kept on. Within a circle of ten miles radius we have four furnaces, which are all in full blast at the present time. By the President : Question. Are you making pig iron ? — Answer. Yes, sir. Q. Are you in favor of retaining the present duty on pig iron ? — A. I am entirely so, and I think the majority of all our people are, up that way. 1 think it would bring the poor people in this part of the country to pretty short quarters if that was taken off. Q. What coal do you use? — A. We are using charcoal. All the fur- naces up in that section use charcoal. In the Lake Superior region they use charcoal. I think it would be very detrimental to this part of the country if the tariff should be taken off. M. A. FULTON.] 1067 WOOL, IRON, AND STEEL. M. A. FULTON. Saint Paul, Minn., September 13, 1882. Mr. M. A. Fulton, of Hudson, Wis., late a country merchant, made the following statement: If I correctly understand the situation, it is for the interest of the wool-growers of the United States (and especially of such of them as have comparatively small flocks of sheep in connection with other farm- ing) to have the duty on foreign wools entirely removed. As to the relative prices I may possibly be mistaken, but, as I under- stand, the wool-growers between the Alleghenies and the Missouri do not receive higher prices at Cincinnati, Chicago, and Saint Louis than are paid at Sydney, Port Philip, Cape Town, and Auckland. The prices at Boston and New York for Ohio and Pennsylvania wools do not seem to be higher than the prices at London and Montreal for the same grades of wool. The duty on flannels, blankets, cassimeres, and all fabrics of wool, or partly of wool and partly of cotton, and weighing over four ounces to the square yard, ought, in my opinion, to be greatly reduced, say down to 10 per cent. It ought not to be true that in Canada, England, Bel- gium, or France as much of heavy woolen fabrics of like quality can be purchased for $10 as in the United States for $14 to $15. I do not of my own knowledge know that such a difference in prices exists, but have been so informed. Possibly the recent tariff legislation of Canada has had the effect to raise the price of woolen fabrics in that country. A good way, perhaps the best, to determine the difference as between, say, Saint Paul and Montreal would be for this Commission to ascertain from the wholesale dealers in each of the two cities, by comparison, the cost prices to them of like qualities and weights of cassimeres, blankets, and flannels. THE TARIFF AS IT AFFECTS FOREIGN COMMERCE. Without foreign commerce the American producer of corn, wheat, cotton, butter, beef, and petroleum would have almost as good as no market at all. Those commodities, when exported, mainly find their markets in the ports of the north of Europe, where they meet and compete with the products of In’dia, Egypt, Australia, Russia, and Canada. Vessels which sail from this country laden with American products quite frequently come back in ballast, thus compelling the American producer to pay double freights, or, in other words, to pay the expense both ways of the trips across the ocean. Sometimes the vessels are laden on their return from Europe with some such commodity as salt, bleaching powder, &c., which, it is alleged, is then frequently sold by the vessel agents at cost, without charge for ocean freights, and sometimes for less than cost. The case seems to be somewhat nearly reversed in the case of American trade with Brazil and other South American states, with China, Japan, and the Philippine Islands, with the West India Islands and East Indies and the Mediterranean ports. The United States buy 1068 TARIFF COMMISSION. [M. A. FULTON. yearly vast quantities of the products of these countries, and we have to pay them, it is said, about a hundred millions of dollars in specie each year, the vessels engaged in that trade carrying back from this country comparatively little either of raAv product or manufactured goods, England, Germany, France, Belgium, and Holland supplying them with goods at less prices than the United States. The same vessels which bring the products of South America to this country quite frequently take cargoes of grain or cotton from this country to Europe, and from thence are loaded for South America. Our very high tariff excludes the competition of foreign goods to so great an extent as to have a tendency to make American manufacturers careless and neg- ligent. It is a serious question whether they are keeping up with the im- provements of the last decades, and whether they are not making poor goods; just as rich physicians and merchants in any county would be tempted to render poor service and charge high prices if they had succeeded in obtaining a law that any physician or merchant in another county should pay a tariff of 75 cents on each dollar earned from business with the people of the county occupied by the rich physicians and merchants. THE TARIFF ON IRON AND STEEL RAILS. I have heard the statement made that the duty on iron and steel rail- way bars added nearly $2,000 to the cost of each mile of railway con- structed in the United States. Keeping in view the annual interest and the addition caused by the tariff' to the cost of renewals, they to- gether must be equivalent to a yearly tax of about $300 a mile, to be paid by the people who patronize the railway's. The people of the upper valleys of the Mississippi and Missouri have a rich soil, have had bountiful harvests, and in recent years have been feeding the partly famine-stricken continent of Europe, and they can just now bear heavy taxation ; but the apparent return of an era of good crops in Europe and probable diminished export demand, and Tower prices for American grain and meats, make it a pertinent question as to whether the tariff on iron and steel ought not to be reduced. My judgment is that such reduction should be made. By Commissioner Garland: Question. You start, I believe, with the proposition that it would be to the interest of wool-growers to remove the tariff on wool. Are you a wool-grower ? — Answer. No, sir. Q. Do you represent wool-growers? — A. No, sir; I only judge from the prices. Q. You are not speaking by authority of the wool-growers? — A. No, sir. Q You stated further that the price of wool in Australia and the Philippine Islands was about as high as here. — A. I stated that I un- derstood it was as high in those countries as in Cincinnati, Saint Louis, and Chicago. Q. How did you obtain that information ? — A. In various ways. I have to judge from quotations in pounds, shillings, and pence com- pared with our quotations. I confess I did not see quotations from those colonies, but I saw the London quotations. Almost every week some New York paper has a wool sale from London. Q. Those wools are brought to this country? — A. To a certain extent. M. A. FULTON.] WOOL, IKON, AND STEEL. 1060 Q. Explain how they are brought here if they are sold as high in those countries as here? — A. I suppose for carpets and some of those things. I do not understand those things. Q. The liner wools I speak of. — A. I confess that I do not understand how they do it, but I only state what I know to be the fact. Q. I was trying to get at your sources of information. — A. I happen to have clipped out of different papers the quotations in London and New York. You, being posted in the business, can tell better than I can; but as near as I can judge the quotations for colonial wools in London to-day are fully as high, if not higher, than they are in Boston and New York for those cheap grades of wools. Q. Possibly I do not understand what you mean by colonial wools. — A. Australian and Cape Colony wools; they are not fine wools. Q. Australian wools are not fine wools? — A. Not very many of them. As I understand the question, there are a great many poor and cheap wools in Australia and New Zealand, as well as some good wools. It is a good deal as it is in this country ; they have various grades of wool and they are largely exported to England. I wish to be understood as saying that those wools sell in England for a series of years at as high or higher prices, according to quality, than the same grades of wool bring right here in the United States. Q,. You are doubtless familiar with the classification of wools under our present tariff. What class do you refer to, second or third ? — A. To the various qualities as they come off the sheeps 7 backs. Q. As they are classified under the tariff? — A. I do not know any- thing about the tariff; I never looked at it. Q. I understand you to say you do not know anything about the tariff? — A. Not definitely. I have a sort of a general idea that a great many farmers think the wool tariff protects them, but I am of the opin- ion that it does not protect them at all. As I understand it, they do not get any better prices at our seaboard markets than in Montreal or London, right along. I do not know that to be true, but I believe it to be. By Commissioner Boteler : Q. Do you think they could get better prices by admitting Canadian, South American, and Australian wools free? — A. I do not know whether they would or not, but 500 men want to buy woolen blankets to where there is one wool-grower. I think it would not affect the price. By Commissioner Garland : Q. I am not certain that I understand you or that we understand each other, as to the class of wools you referred to. What is the tariff paid on the colonial wools you referred to? — A. I do not know what tariff our government charges upon them. Q. Still, you think it charges too much? — A. I think it ought to go off absolutely and clean. If this country is going to be a manufactur- ing country, we do not want a tax upon such raw material as that, any- how; and I think, too, it would be in the interest of the wool-grower to have it taken off. Q. Please explain why. — A. Because wools now, with the tariff to protect them, as I say, do not bring any more in Boston or New York than in London or Montreal. That does not make it absolutely certain that with ihe tariff off it would reduce prices, but I think it is pretty clear that it would. Besides, the ordinary small farmer has, perhaps, from ten to thirty or forty sheep, and this high tariff on wools and woolen goods costs him, perhaps, more than his whole fleece from his flock brings. 1070 TARIFF COMMISSION. [M. A. FUI-TON. Q. Do you mean by that that you do not believe that the tariff on wool adds to the price of wool in this country? — A. I think it does not. Q. What disadvantage is it, then ? — A. It is a disadvantage to this extent: that so far as those foreign wools would enter into the manufact- ure of any of our woolen fabrics, it might possibly enable them to be manufactured cheaper. Of course, I confess that I may be in error, but I state it as a fact that I have been watching for years and I do not understand the prices of wools in this country. By Commissioner Boteler: Q. What interest do you represent? — A. None at all. Q. Are you not in wool manufactures? — A. No, sir. I own some farms and I am largely mixed up in business with an almost exclusively farming population. I live in a country village with some small manu- facturing industries, and generally those people would like to get things in as fair a shape as they can; they do not feel like playing smash with anybody, but they think the government is getting too much money, and they would like to have the tariff reduced. W. H. DOYLE.] J BOOKS. 1071 W. H. DOYLE. Saint Paul, Minn., September 13, 1882. Mr. W. H. Doyle, with Hoxsie & Jagger, wholesale merchants of Saint Paul, made the following statement : Books are first mentioned in the United States Statutes at Large as subject to a duty in the general tariff act of 1842, vol. 5, page 557. The provision in the tariff of 1780, that “all articles imported not herein enumerated shall pay a duty of 5 per cent, ad valorem,” would of course apply to books, but this cannot be considered a protective duty. Evi- dently the Congress of 1789 was of the opinion that the book industry did not need much fostering to aid its gradual development. Amid all the changes which the tariff underwent from 1789 to 1842, the great iu crease of duties in the strong protective tariff of 1810, amid the struggles of a large family of infant industries to see which could get the most protection, the necessity of the American book trade having pro- tection does not seem to have been recognized. This fact is significant. It proves one of two things : either that our publishers prior to 1842 did not ask for protection, or, if they did, Congress did not think it necessary to give it. In 1810 Albert Gallatin, Secretary of the Treasury, made a report in which he stated that about a dozen different industries were firmly es- tablished, and among those were the manufacture of printing types and the book industry. " In the tariff act of 1842 the duty on books printed in the English language was fixed at 30 cents a pound ; on books in foreign languages, except Latin and Greek, 5 cents per volume — Latin and Greek books 15 cents a pound. To the proviso in this section of the tariff I wish to call particular attention. It is as follows : That whenever the importer shall prove to the satisfaction of the collector when the goods are entered that any such book has been printed and published abroad more than one year, and not republished in this country, or has been printed and published abroad more than live years before such importation, then and in such cases said books shall be admitted at one-half the above rates of duty. Congress here apparently recognized the self-evident fact that a duty on books not republished in this country is no protection to the Amer- ican publisher. In the revenue tariff of 1846 the duty on books was reduced to 10 per cent, ad valorem. In the act of May 1, 1861, it was fixed at 15 per cent, ad valorem. In 1864, during the darkest period of the civil war, when the government was trying to obtain money by every means in its power, the duty on books was raised to 25 per cent, ad valorem, the present rate of duty. In 1871 the value of books published in the United States was esti- mated at $40,000,000. I have no data of the value of books published iu England the same year, but in 1876 it was estimated at $4,270,000. In 1876 we imported books from England to the value of $940,000, and exported to England $93,000 worth of books. I leel confident in stat- ing that, if we had any way of verifying it, we would find that fully two- thirds of the books we import are not republished in the United States. With Canada and other British possessions we have a large export trade in books. The book industry from its very nature is one which cannot be bene 1072 TARIFF COMMISSION. [W. H. DOYLE. fited very much by a protective tariff. No matter how high the duty is on a foreign book, unless this book is republished in the United States there is no protection afforded by that duty. It can be said that a high duty encourages the republication of foreign books. Perhaps if does in a very few cases, but the principal element which determines an Ameri- can publisher whether or not to republish a foreign book is the reputa- tion of its author in the United States, and the circulation it would prob- ably have. A protective tariff on books is asked for on the ground that books are produced in Europe cheaper than in this country. As few books are printed here in any language but the English, I will only consider the relative cost of books in England and the United States. I admit that England ought to be able to produce books possibly a little cheaper than we can ; but I deny that the price of books in England is lower or even as low as in the United States. The reason is that the English pub- lishers, aware that the price of a book depends largely on the number of copies printed, charge enormously high prices because they do not expect a large circulation, or because they prefer to sell a small num- ber of copies of a book at high prices rather than a large number at low prices. They object to bringing out cheap editions, beeanse it would in- jure their interest in the more costly edition. On the other hand, American publishers long ago found that there are three classes of book-buyers in the United States: those who buy books for the sake of the binding; those who buy books to read them, and only want a binding of ordinary durability ; and, lastly, those who also buy books to read them, but whose financial condition makes it necessary for them to buy as cheaply as they can. A book that will find readers in these three classes will be published in three editions, varying in prices. The character and tastes of the people are what determines the suc- cess of the book industry in any country. The only trie way to foster and encourage the book industry of this or any other country is to fos- ter and encourage the cause of education. This is the best protection which any government can give the book industry. This our general government has done, and so have all the States. Justin proportion as education is diffused the love of knowledge and the love of books in- crease. The school teachers of the United States do more to encourage our book industry than our protective tariff. Those interested in the book trade, instead of asking for protection, ought rather ask that no impediments be offered to the progress of popular education, as it is this which creates the demand for books. I do not appear here as the representative of any particular interest, unless it be the interest of those who believe that there should not be an import duty on anything which aids the general diffusion of useful knowl- edge, and who ask that all strictly moral books be put on the free list. The general diffusion of useful knowledge is one of the most important means to increase the prosperity of the nation and to prevent pauperism and crime. I believe it is to the interest of every citizen that the price of books shall be as low as possible, in order that they may be within the reach of the most destitute. It has been well said that the books are the friends of the friendless, and that the library is the home of the homeless. For the knowledge that comes from true books I claim no more than it is fairly entitled to. I am aware that genius and learning are often found in the lowest places. I claim only this, that, other things being equal, the man who has the largest amount of resources has the least temptation. W. H. DOYLE.] BOOKS. 1073 If the history of the protective tariff of our country is studied, it will be seen that it owes its origin to a desire to encourage our industries. It will also be found that as learning increases new industries are added. It is one of the inevitable consequences which results from the enact- ment of a protective tariff that it generally comes to pass that the tariff will be so enlarged as to take in nearly everything. Industries which would need protection, and which in nine cases out of ten are not bene- fited thereby, nevertheless ask for it, if, for no other reason, that it confers additional honor and dignity to have it put under the protection of Con- gress. The manufacturer hears his protected neighbors talking about their infant industries, and also hears the cry how kind and considerate Congress is towards them, and suddenly he discovers that his is an in- fant industry, and forthwith he rushes off to Washington and implores the Committee on Ways and Means to give his poor little infant some protection, or otherwise it will perish. Competition always has been, and always will be, disagreeable to those who are affected by it; and whether that competition is great or small the aversion seems to be the same. This seems to be the reason why the American book trade asks ptotection against foreign goods. It has almost come to the pass in the United States that every industry but the agricultural seems to have a vested right to enjoy the benefit of a protective tariff. Some of our manufacturers are getting so that they don’t ask it as a privilege, but demand it as a right, claiming that they are public benefactors and that instead of our grumbling on account of their being protected, we ought rather to thank them for sacrificing themselves to the public good by engaging in industries which are so unprofitable that the people of the United States must contribute to their support through the instrumentality of a protective tariff. I understand that one publisher has appeared before you, but he does not ask an increase of duty. He simply asks you to recommend that the present duty of 25 per cent, ad valorem be allowed to remain, and he and his fellow publishers will struggle along with their poverty and try to compete with the pauper labor of England. We are told that it is necessary to pay a duty of 25 per cent, on books in order that our ow r n authors may be encouraged ; that it is better for us t o develop the book industry and thus do away with the necessity of importing books. Would it not have been better for the people of the United States if Congress had prohibited the works of Shakespeare and Bacon from be- ing imported, for the reason that it would be better that they should not have these works, in order that they might be encouraged to pro- duce similar poets and philosophers ? It seems to me that so far as the protection is concerned, American books and newspapers stand on the same footing. If it were a duty to protect American newspapers, and a citizens of Saint Paul were to ask for its removal, he would be informed that our newspapers could not possibly exist without protection ; that citizens of Saint Paul would sub- scribe for English papers because they are cheaper; that they would advertise in them because the rates would be lower; that they would keep themselves posted on Saint Paul. markets through English sources ; and our great daily would have to cease for want of patronage, because it could not compete with English newspapers. There are plenty of other articles that can be taxed with more bene- ficial effect on the country. Good literature, at least, ought to be al- lowed to enter our country free. Of course the general government has. the power to put a high duty on literature; it also has the power ta impose internal -revenue taxes on schools, educational institutions,, and H. Mis. G G8 1074 TARIFF COMMISSION. fW. H. DOYLE. on American printed books ; it lias the power to require booksellers to pay a high license, and it has the power to make the diffusion of knowl- edge as difficult as possible, and the money derived from these sources could be used to build jails and penitentiaries. Gentlemen of the Commission, I feel as if I could talk a week about these internal taxes on books,, and still have something to say, but I have taxed your patience long enough. I simply desired to call your attention to it in order that you may give it that consideration which its importance deserves. I think you will find the question the least complex of any that has been presented so far. By Commissioner Underwood : Question. You seem to have studied the tariff on books. I find upon the free list now, according to Heyl’s Digest — All books which shall have been printed more than twenty years ; books, maps, and charts imported by authority for the use of the United States, or for the use of the Library of Congress. * * * Books, maps, and charts specially imported, not more than two copies in any one invoice, in good faith, for the use of any society incorpo- rated or established for philosophical, literary, or religious purposes, or for the encour- agement of the tine arts, or for the use or by the order of any college, academy, school, or seminary of learning in the United States ; books, professional, of persons arriving in the United States; books, household effects, or libraries, or parts of libraries in the use of persons or families from foreign countries, if used abroad by them not less than one year, and not intended for any other person or persons, or for sale. I understand that your proposition is to put all books on the free list? — Answer. Yes, sir; I am fully aware of those provisions you have read. Q. If you propose to put all books on the free list, that would include every publication in Europe? — A. It would. Q. Including the works of Huxley, Darwin, and Herbert Spencer ? — A. Yes, sir. Q. Do you think that that kind of literature ought to be encouraged in the United States by putting it on the free list ? — A. I do. I would state further that if Congress would only provide for books in private libraries, then I would not object ; they provide for every other kind of library but the private library. By Commissioner Porter : Q. Is it not the fact that the works of Huxley, Darwin, and Herbert Spencer can be bought here at probably one-twentieth of their cost in Europe ? — A. I know they are published by D. Appleton & Co. Q. Reprints, I mean? — A. Yes; they are reprints. I think the prices of D. Appletbn & Co. for reprints are as low as possible — lower than in England. But the question is about those books that are not repub- lished in this country. How are you going to get them cheap ? If every English publisher would publish every book that is wanted in this country, we would not grumble about the tariff. It may be urged on this Commission that if you put books on the free list, you should also put paper on the free list. 1 have the statement of Senator War- ner Miller, of New York, to the effect that, owing to the success of the paper industry in this country, the price of print paper is almost, not quite, as low in the United States as in England. I have a copy of his speech here, and can show it to you if you desire. J. B. 6AVB0RN.] INDUSTRIES OF MINNESOTA. 1075 J. B. SAKBORK Saint Paul, Minn., September 13, 1882. Mr. J. B. Sanborn, president of the Chamber of Commerce of Saint Paul, made the following statement : I was not deputed to make any statement before the Commission, and certainly have no desire to represent any particular interest in the country. I have furnished to the president of the Commission the re- port of our commissioner of statistics for the State, which will show the character and the extent of our productions, and the industry in which our population is engaged ; also, the report of the Chamber of Commerce of Saint Paul, which shows the character and extent of our manufact- ures in this city and the character and extent of the business of the city, and indicates in some measure the present population and growth of the city. It is, perhaps, not improper for me to state in a general way what you will all conclude upon looking over these statistics and gaining a knowl- edge of our industries and business — that, perhaps, no people in the country are less benefited directly by the practical effects of the tariff than the citizens of Minnesota. But it is so difficult for a government like ours to determine what the interests of one State are, taken in eonnec- tiop with others, that, of course, it is extremely difficult to determine the true policy to be adopted by the government. The question is what are the great interests of all the States when considered together ? Of course, every year our manufactures become greater, and our industries are growing up, which, if the present policy of the government is contin- ued, will require the continuance of protection. I think there is no healthy public sentiment in this State in favor of prostrating those great indus- tries which have been fostered, and which have grown up under the protective care of the government, but the general belief is that the present tariff is higher than is necessary to furnish sufficient revenue to defray all the expenses of the government, and higher than is neces- sary to afford adequate protection to those industries which have been fostered and have grown up under the present system and under the protecting care of the United States. The times are most prosperous, and no one, I imagine, could favor and sustain a radical measure which would chapge all this. Of course, the greatest wisdom is required to prolong this period of prosperity that we are now in, which is, perhaps, prosperous beyond precedent in the history of the country. I did not contemplate making any remarks to the Commission, but simply desired to call your attention to what I deemed to be our true interests, so that they may have the proper weight with you in making up the great balance which is to govern the Commission in making its recommendation to Congress, as to what the interest of all the States requires. By Commissioner Oliver : Question. I did not get exactly the full force of your recommendation. As I understand it, your opinion is that the sentiment of the people of this section would be against any very radical change? — Answer. Against any changes so radical as to prostrate existing industries. 1076 TARIFF COMMISSION. fj. B. S 4.NBOKN. Q. At the same time you believe that the tariff generally on all arti- cles is too high, and the people of this section would be in favor of a re- duction? — A. That is, speaking generally; I would not say all articles and be literally construed. There may be articles where possibly the duty is too low, even now. Of course, I have not given that considera- tion to the great number of articles ; I believe there are 1,300 or 1,400 on the list. Of course, there may be articles not sufficiently taxed ; but, generally speaking, more revenue is raised than is necessary, and more protection is given to certain industries than those industries require at this time. That is the precise position. By the President : Q. How many persons are employed in your city in manufactures? — A. Eight thousand last year ; this year probably 10,000. Q. What is your population? — A. Our population is estimated by the most conservative at 65,000, and by the men who have prepared the directory at 75,000. We have 30,000 names in our directory, and estimating the population at 2J for each name would give us a popula- tion of 75,000. The growth of the city for the last two years is unprece- dented in this country. It has been very rapid. The banks of the city this year will sell about $80,000,000 exchange. By Commissioner Garland : Q. What are your principal manufactures ? — A. Agricultural imple- ments is one of the largest industries; also, boots and shoes, clothing, and almost all articles. On page 10 of the report of the Chamber of Commerce is a table showing how the list is made up. The following is the statement above referred to : Statement of the manufactures of Saint Paul for the year ending December 31, 1881. Kinds of business. Agricultural implements Awnings and tents Blacksmith and wheel wrighting Bookbinding Boots and shoes Boxes Bread and bakery products Brewers and maitsters Brick and tile making Brooms and brashes Carpet- weaving (rag) Carriages and wagons Cigars Clothing, men’s Clothing, women’s Coffee, spices, and baking-powder Confectionery Cooperage Dentistry, mechanical Drugs and medicines Dyeing and cleaning Florists Flour and grist milling Foundry and machine shops Furniture and upholstery Furs, dressed Iron, architectural Jewelry and watch making Laundry ing I Lithographing, stereotyping, and electro- j t-VPing ' I 2 2 30 5 56 6 20 12 5 4 4 13 32 56 70 3 10 6 16 11 4 17 5 2 19 13 *1 31 1 7 1 2 *1 1 5 3 I 03 <0 rS Increase over 1880. 1 Value of products. Increase over 1880. 375 50 $800, 000 $200, 000 31 7 93, 000 50, 500 178 40 90, 665 21, 665 71 19 71, 546 20, 400 479 70 813, 450 127, 000 47 9 63, 200 14, 700 98 8 202, 600 67, 500 139 20 638, 498 140, 261 122 , 63 80, 400 26, 200 31 i 5 46, 550 5, 550 6 1, 500 ! 300 197 26 1 354,500 62, 500 221 73 408,918 | 83, 737 718 151 992, 902 206, 675 114 40 157, 000 54, 000 96 23 | 417, 000 153, 000 71 • 14 169, 500 91, 300 39 2 38, 000 3, 000 22 5 41, 350 2, 935 45 5 161,400 44, 700 8 7, 300 1, 850 23 3 24, 000 4,000 64 5 1, 006, 906 379, 200 258 87 417, 800 118, 800 155 43 427, 000 11, 100 35 46, 200 2, 000 58 12 97, 500 26, 500 46 2 55, 800 9, 360 152 51 59, 264 16, 984 52 6 1 68, 359 1, 850 7 I Decrease. J. 15. SANBORN. 1 INDUSTRIES OF MINNESOTA. 1077 Statement of the manufactures of Saint Paul, $'C. — Continued. Kinds of business. Number of es- tablishments. Increase over 1880. Number of em- ployes. o ® © ai vs a oo © .-1 t- o P Value of products. Increase over 1880. 4 1 14 4 $14, 000 33, 050 $1, 500 4,000 11, 650 721, 050 8 1 22 2 Marble and stone cutting 12 1 106 10 107, 000 2, 315, 777 83, 000 22, 458 315, 300 50, 450 367, 320 130, 300 847, 850 951, 376 196, 440 257, 500 1, 261, 900 35, 000 Masonry contracting and building 69 12 1, 880 67 693 Millinery and lace goods 9 2 13 . 17, 000 5, 979 Mineral waters 5 23 2 Paintin 0- and papering 28 5 202 43 71, 700 Photographing 9 29 1 9, 425 Plastering and stucco work 21 3 247 62 108, 000 54, 000 212, 012 119, 546 Plumbing, steam and gas fitting 10 1 119 32 Printing and publishing 23 4 640 126 Railway repairs and car-builders 4 500 Saddlery and harness 12 1 103 23 36, 050 108, 500 176, 300 10, 000 Sash, doors, and planed lumber 10 3 245 138 Slaughtering, meat-packing 51 10 207 36 Shirts 5 1 55 10 Stair-building 3 15 11, 800 2, 500 56, 800 24, 700 Steel, iron, brass, and boiler works 8 1 112 40 247, 606 120, 377 850, 923 Tin, copper, and sheet iron 20 2 109 31 Unclassified* 30 3 291 54 144, 458 Total 792 125 8, 937 2, 159 16, 071, 535 3, 859, 387 * “Unclassified” includes taxidermist, gas-light company, optician, linseed-oil company, artificial limbs, soap company, terra cotta works, abattoir, metal and ivory turner, repair shop, hoopskirts and corsets, fireworks, boat builders, fish packing, mustard factory, organ builder, insect-powder manu- factory, hair-work, regalia, show cases, type foundry, steam-power furnishers, can factory, sewer -pipe manufactory, wire- works, brush-makers, gent’s furnishing, toys, trunks, and valises. Q. Does it state the amount of capital invested? — A. I do not think it is stated there. The amount of capital is very large. I should hardly dare trust my own judgment, not being a manufacturer, as to the amount. I think this year the amount of capital invested in man- ufacturing will be nearly $4,000,000 over last year, and last year it was $4,000,000 over the preceding year. The principal articles produced in this State are lumber and wool. I imagine that the parties interested in those productions would be opposed to any reduction in the tariff on either wool or lumber; but I represent neither interest. They no doubt will appear before you at Minneapolis — the lumber interest particularly. Minneapolis is the great city for manufacturing lumber. Q. Do I understand you that the other industries (agricultural im- plements, boots and shoes) favor any reduction ? — A. They do not take interest enough in it to appear before the Commission. There is a belief, whether intelligent or not, that the iron they use is protected beyond what is necessary. Whether that is an intelligent conclusion I do not know. Q. Do you state that as your belief or as the belief of others ? — A. I do not think I have talked with the manufacturers. I should not want to state that it is the view of those who use. the iron and put it into the machinery ; but I think it is the view of those who buy the machinery and use it. By the President : Q. What class of agricultural implements are manufactured here ? — A. Plows, separators (thrashers we call them here), mowers, and reapers. Q. Is it a matter of great convenience to the farmers of this country to have their agricultural implements made at their very doors?-— A. A 1078 TARIFF COMMISSION. [J. B. SANBORN'. great convenience, and a vast saving. It is impossible to carry on ag- riculture as it is carried on now without this machinery. Q. And without it being here in their very midst? — A. Yes, sir. A man with two or three boys now will do more than 40 men would have been able to do on a farm in New England thirty years ago; will har- vest more and get it to market than ten times that number. Q. Then it is your opinion that the agriculture of the country has been benefited by the manufactures? — A. Vastly — the agriculture of this section at least; how it has affected New England I cannot speak advisedly. By Commissioner Oliver : Q. I should like to ask how far you are here from the Canadian border? — A. I cannot give the precise number of miles; by the Mani- toba Bailroad to Pembina I should say approximately about 205 or 207 miles. Q. Please state the nature of your trade with the British possessions north. — A. The goods that go into that country very largely go through in bond from Canada or from the British possessions somewhere, and the traffic that comes from there is mostly, at this time, wheat. There has been such a large population going into that country that nearly everything that is produced there is required for home consumption. I do not think that the amount of wheat that has come out of that country up to this time would amount to much — would hardly reach the millions, perhaps. Yet that is the trade that will be carried on, and it will be in the purchase of agricultural productions and the furnishing of such supplies as we can furnish cheaper than they can be elsewhere. I have no doubt we do furnish them their agricultural machinery at this time. Clothing, I have no doubt, is very much cheaper there than on this side of the line, on account of tbe tariff. People can go there and buy clothing to advantage, and ship it from Canada through the United States in bond. I am reminded by one of our citizens, Mr. Humphrey, that there is one subject that is agitating the people here a little, and that is the drawback upon wheat imported from the British possessions, which has been al- lowed by the Secretary of the Treasury under a general law. Our farmers have found a great deal of fault with it, and it has raised quite a storm in the State against the whole tariff system. The farmers claim that if there is to be protection, they ought to be protected to that extent, and say that the tariff should stand as it is now ; that the drawback should not be allowed ; that they should not be allowed to sell us wheat and have it manufactured in competition with the wheat in Minnesota. Of course our millers take the opposite view. There has been considera- ble feeling in the State. But there are two sides to the question. The farmers claim that they should be protected and that that law should be enforced literally, while the millers are on the other side of the question. By Commissioner Garland : Q. What amount of wheat lias been imported? — A. I cannot give the statistics. I spoke of it as being considerable, basing my statement on the statement of Colonel Gray, president of the Duluth Elevator Com- pany, in which he stated that he did not think there had been exceed- ing 300,000 or 400,000 bushels that had gone through it up to this time. It is unquestionably the feeling of the English statesmen that they can raise wheat in that country in competition to the United States, and use what they want, and thereby save the purchasing of that produc- J. H. SAXBORN.J INDUSTRIES OF MINNESOTA. 1079 tion from the people of the United States. It is a point deserving of consideration by the Commission, and I have no doubt that all our pro- ducers are feeling a very decided conviction that the tariff should stand upon wheat. By Commissioner Oliver : Q. How would they be fixed in regard to freighting it to the seaboard by the new Pacific road? — A. It would be as cheap, or cheaper, when their line reaches the mouth of Pigeon River or the navigable waters of Lake Superior, which would enable the wheat of all those northern re- gions to reach all parts of the globe without breaking bulk. They can transport in the same bottoms from Lake Superior to Liverpool or Lon- don, or any portion of the globe, if necessary. There will be only 200 or 300 miles of railroad transportation necessary. Q. What is the impression here in regard to the wheat-producing country in the North British possessions !■ — A. The impression here is that it is vast. A. As great as that of Minnesota ? — A. Yes, sir ; I think so. I think the impression is here that they can raise more wheat, perhaps not bet- ter or more per acre ; but there is a vast area capable of producing wheat. By Commissioner Underwood: Q. Do you think the protection afforded to the manufactures of agri- cultural implements enhances the prices of those manufactures? — A. That is going pretty deeply into the tariff question, and I should prefer not to answer. 1 understand something about the tariff question, and I know that it is very complicated. You can hardly select one item and ask a question upon that and have it answered intelligently. Q. Have you any reason to believe that the agriculturists of this country desire the protective duty upon agricultural implements to con- tinue ? — A. I must answer that question in this way. I do not think that those who use the agricultural implements feel themselves compe- tent to judge as to whether or not the abolition of protection would re- duce the cost of the production. They are governed solely, of course, by self-interest. u Charity begins at home,” and that is the first law of nature. If they believed that they could procure the im piemen ts cheaper if the tariff was removed, they would favor its removal, unless they saw that, taking the whole question into consideration, it would be to their disadvantage. Q. You said there was a general sentiment in the country in favor of retaining this protection ; not, perhaps, to so great an extent as it now exists, but to a considerable extent. — A. I did not mean to be so under- stood. Q. I want to know if that sentiment exists among the agricultural classes, or do you derive it from the manufacturing classes? — A. I in- tended to speak for all classes, so far as I know what their sentiment is. Q. Then my question recurs : Have you any well-founded reason to believe that the agriculturists desire the continuance of protective du- ties ? — A. If I answer the question categorically, I shall say u no.” By Commissioner Kenner : Q. Have you ever heard any of the farmers object to it? — A. I have heard the expression from all classes that the duty is higher than the conditions of these times require, in their belief; that what they pur- chase for consumption they should get cheaper, and what they have to 1080 TARIFF COMMISSION. [J. B. SANBORN. sell, of course, they want to get the highest price they can in a foreign market, as a rule. The foreign market controls the price of production very largely, and anythingthat disturbs the general industries will pro- duce prostration, which is against the interest of all classes. All intel- ligent men concede that the tariff question is a very complicated one, and considerate men express themselves very cautiously in regard to it. By Commissioner Garland : Q. Is it not the tact that the largest proportion of these implements is covered by letters-patent ? — A. There are none that I know of in which there are not patent rights for some portion of the machinery. Q. Is it not a fact that these prices which the public complain of re- sult more from the protection afforded by the patent law than from the tariff law ? — A. Of course they think they are affected by both ; and then there is another item that enters into the account very largely, and that is that the agricultural people buy upon credit of six to eight months, and that increases the prices. The high prices of agricultural machinery are brought about by three or four things; one is the patents on various portions of the machinery ; no doubt the protective tariff is another element, and they all combine to make these implements very costly. ALFItED WEIGHT.] PERFUMERY. 1081 ALFRED WRIGHT. Saint Raul, Minn., September 13, 1882. Mr. Alfred Wright, of Rochester, N. Y., manufacturer of per- fumery, addressed the Commission as follows: Mr. President: I happened to be passing through Saint Paul this morning on my way to Chicago, and having failed to meet the Commis- sion in Rochester, I wish to make my statement here. I am a manufacturer of perfumery and an importer of materials used in its manufacture, and I simply wish to call the attention of the Com- mission to the fact that we are paying more duty on raw materials than the manufactured goods pay. For instance, there are many articles classed in the tariff as pomades; I do not know that the number is spe- cific in any way, but the odors of flowers, notably roses, jasmines, and the orange flowers are obtained and preserved by macerating the petals in spirits, and that process is repeated until the pomade becomes of sufficient strength for manufacture, as No. 24 or 30. There are always numbers used, but they are used mostly in cosmetics, &c. They are then filled in cans. In my own case I import them in ten-kilogram cans, but the trade generally in this country is supplied by five-kilogram cans. I take the flowers and macerate them in spirits and afterward dissolve oil in the spirits, and it is ready for the combination in the vari- ous odors that go to make up any handkerchief extract. On this we pay 50 per cent. We also pay a duty equal to one-half of the commission, which is rated at 2J per cent. Two and a half per cent, is what we are usually taxed, but we pay no commission, and I know of several manu- facturers who do not pay any. That brings it up to about 51^ per cent. There is also another element; that is, our medium for cologne is de- odorized alcohol. Upon that we pay an excise indirectly. Our com- petitors, the French manufacturers, have an allowance made of about 8 per cent, for evaporation, while we have no allowances for that. In the English market the goods of the London manufacturers, who are to a considerable extent our competitors, are all manufactured in bond ; they receive the raw material or spirits free of all duty. In London they have to pay an excise on spirits and some duty on some essential oils. On essential oils we pay a duty. I have a considerable reputation for manufacturing handkerchief extracts. We have to pay very much higher prices for materials than are paid in London. I should not have taken up your time except for the possibility that other manufacturers want the duty retained on their goods, and we want it retained on ours. But if you make any reduction I want you to understand that the duty should be taken off the raw materials that are not produced in this country. Those materials cannot be manufact- 1082 TARIFF COMMISSION. [ALFRED WRIGHT. ured here until a whole generation of women and children are edu- cated to pick flowers for the meager compensation they receive in the south of France. By the President : Question. Will you make a list of the pomades that are not made here? — Answer. There are no pomades made in this country, and I should have added that those pomades I speak of are not used for the hair. Q. What I understand by pomade is the oil used for carrying the scent. — A. Yes. The oil of jasmine cannot be distilled ; pretty much all our oils pay 50 per cent. ABEAM 8 HEWITT.] IRON AND STEEL. 1083 ABRAM S. HEWITT. Saint Paul, Minn., September 13, 1882. Hon. Abram S. Hewitt, of New York city, being in Saint Paul on private business, and having been requested by the Commission to address them as an expert in the manufacture of iron and steel, spoke as follows : Mr. President, I suppose that if the Government of the United States did not need a revenue for its support, the question of framing a tariff would never have come up. I suppose it originated in the neces- sity of the government for revenue. I suppose the question of protec- tion is absolutely incidental. A tax for revenue undoubtedly adds to the price of the article which is imported, and is so far unquestionably a protection to any industry that may grow up in that line of business, whatever it may be. Hence it is impossible to consider the question of tariff, even from the revenue point of view, without considering the effect of the tariff upon the industries of the country, and, whether we like it or not, incidental protection must result from a tariff for reve- nue. You are therefore brought always to consider the question of protection and the effect of the duty upon each class of products upon which you impose a duty. When you do that, you are brought to con- sider the question at what point you will begin to protect ; in other words, whether the duty you propose is protective or obstructive ; whether it is protective or destructive. For instauce, you may arrange your duties upon raw materials in such a way that it will be absolutely impossible to carry on the business of manipulating the raw materials and producing useful forms. That is protective to the raw material and destructive to the manufactured article. Nevertheless, it is a revenue duty, because the raw material may come in for some uses and would pay a revenue to the government. Iu selecting a basis for revenue I suppose an intelligent Commis- sioner or statesman is bound to consider the effect of the duty imposed. If he finds that the duty on the manufactured product is less than on the raw material, he will undoubtedly raise it on the manufactured product. Particularly should he be careful, and should the Commission be careful, iu considering the question of imposing upon raw materials duties that are not protective, that is to say, not needed for protection. That brings me to the question of iron ore. Iron ore is an earth. There is no labor involved except in digging it out. Our competitors are three thousand miles away. The Ireight on iron ore is greater than the whole cost of digging it out in this country and putting it upon cars or boats. I state this deliberately, for I have heard it said that iron ore came here in ballast. I want to say that 100 tons or 500 tons possibly may have come in ballast at some time or other, but it is not true absolutely that it comes here in ballast. It comes as a cargo, and generally as an exclusive cargo, ships being chartered for the exclusive purpose of bringing it. And in my experi- ence I have never known a charter-party under 15 shillings per ton from Africa or Spain; that is, about $3.50. If there is competition anywhere it must be on the coast; in other words, those on the coast are the ones who ought to complain. Those in the interior are protected by the addi- tional freight. I am a miner of iron ore in New Jersey, Pennsylvania, 1084 TARIFF COMMISSION. [ABRAM S. HEWITT New York, Michigan, Tennessee, and Alabama. I believe that state- ment covers the States in which I am interested in mining iron ore. I am told that the Lake Superior men ask for a duty upon iron ore. The freight upon iron ore from the coast to Chicago and Cleveland (which are the great markets for Lake Superior ore, though some of it is car- ried to Pittsburgh) — the freight alone is greater than the cost of mining iron ore at Lake Superior, and the freight thence to Chicago. Of course I cannot understand that protection is needed in any such case ; and in New Jersey, where I am a miner of magnetic ores on a large scale, and in Pennsylvania, there is not a pound of ore — and I mine at least 100,000 tons a year — that is not put on the cars for less money than the freight from Africa and Spain to New York. The duty that is put upon these ores is necessarily added to the price to the consumer. These foreign ores come into this country because they are necessary for the purpose of mixing with our ores. Their cost, therefore, goes into the cost of the article and is paid by the consumer. The government gets a revenue which it does not need. You would not be here to-day except lor the surplus revenue which we do not want. A tax is put upon iron ore, which cannot compete with the American ore for the reason I have given to you, and you put a burden upon the consumer which is purely and absolutely unnecessary. The reason wby this foreign ore comes in is because it is low in phosphorus, while most of the American ores, I am sorry to say, have a little too much phosphorus in them to make a good steel. Every ton of foreign iron ore that comes here makes a market for a ton of American ore that otherwise would not be used, and does not reduce the price, because our ore is already sold for half the money that foreign iron ore costs laid down here. You reduce prices when you have competition, but here the thing is sold at higher rates, and therefore it does not reduce the price of American ore, but by enlarging the market for it gives us a better price. There are no conceivable circumstances under which I think a duty should be placed upon American ores, nor is it of any conceivable bene- fit to any earthly interest. On the contrary, it is a positive damage to retain it. I do not import any foreign iron ore ; I do not use any. I use my own ore, but 1 simply deal with the question as a matter of public concern, in which the consumer can be benefited without injury to the producer. Commissioner Ambler. As I understand your argument, it amounts to this : that the present or any proposed tariff upon foreign iron ore is a mere revenue tariff, and that, in your judgment, it is not a proper subject for the imposition of a tariff. Mr. Hewitt. For the reason that it impairs our ability to produce a manufactured article at a low cost. I have no hesitation in putting a revenue on any article, if the government needs the revenue, but the revenue should be got, as far as possible, from such articles as would not obstruct the growth of American manufactures. I believe this country is to be the greatest manufacturing country, and I want to make the growth of manufactures as easy and rapid as possible. I would there- fore take off the duty on iron ore because it is simply an obstruction to the growth of some kinds of business. To take it oft' is protective in the sense that it removes an obstruction. As to the doctrine of protection for the sake of protection I may entertain different views. I am against obstruction where it is not necessary, whether I am in favor of protection or not. Commissioner Oliver. You will acknowledge, I think, that the ARRAM S. HEWITT. | IRON AND STEEL. 1085 400,000 or 500,000 tons of iron ore that comes into this country — you may say all of it — has been used in 'making Bessemer-steel rails. Mr. Hewitt. The great bulk of it. Mr. Oliver. And the concerns that have been using this iron ore on which there is a duty are the large Bessemer-steel concerns of the sea- board ; is not that so ? Mr. Hewitt. Yes, I suppose so. I believe it has gone mainly to Bethlehem, Cambria, and some to Pittsburgh ; I do not know whether any has gone to Cleveland or Chicago ; I think not. Commissioner Oliver. Steel rails have been exceptional, and the profits enormous beyond that of any other manufactured article in this country ? Mr. Hewitt. I have never known of any such profits in connection with any business with which I have had anything to do. Commissioner Oliver. So that upon this ore the duty has been paid by these large Bessemer-steel concerns called monopolies. Mr. Hewitt. The Bessemer steel concerns and all other concerns are mere intermadiaries between the producer and the consumer; the more cheaply they get their articles the more cheaply will the consumer get his. Commissioner Oliver. I think you will acknowledge that they rarely pay any attention to that. Mr. Hewitt. They are governed by the law of supply and demand. The current rate is a question of demand and supply, but the average rate is based upon the fair cost of production. In other words, if a man dc^s not get his profits on an average he stops his works, and if he does get his profits he continues to run. If you mean to say that the money has been paid by these various steel works into the Treasury, it is true ; but that has come to an end. These steel works are now able to produce steel rails in excess of the demand, and therefore the burden will be taken from the consumer by taking the duty off the iron ore. They are competing with each other now for the first time. Commissioner Oliver. You will concede that labor is lower in Can- ada, for instance, than it is with us. Mr. Hewitt. Certainly, and it is lower in Great Britain than it is in Canada ; and it is lower in France than in England, and lower in Bel- gium than in France. Commissioner Oliver. There are very large deposits of rich ores in Canada, and those are the only ones that will bear transportation. Mr. Hewitt. Certainly, and I want it to come in free as soon as possible. Commissioner Oliver. Would it not be fair to admit the argument that the ore producers made to us some days ago — that the small dif- ference between the cost of labor in Canada and this country is influ- enced by what is termed the protective policy of the government, and to that extent it should have a nominal protection of 50 or 75 cents? Mr. Hewitt. I do not want a nominal protection of 75 cents on ma- terial that originally costs $1 a ton. Commissioner Oliver. Nominally, labor is worth 20 cents a day on the Mediterranean. Mr. Hewitt. So much the better for us, for that does not reduce the value of American labor a particle. I tell you it does not, because the freight alone is more than it costs me to dig my ore and pay $1.50 a day, and therefore it does not reduce the price of labor. Commissioner Oliver. I understood you to say that these foreign ores were necessary to mix with yours ? 1086 TARIFF COMMISSION. [ABRAM S. HEWITT. Mr. Hewitt. Certainly they are. Commissioner Oliver. Then you do not compete with those ores? Mr. Hewitt. I said distinctly and plainly that there is no compe- tition with them. Nobody competes, because the freight on these ores is more than the cost of digging the American ores and putting them on board a boat or cars. Commissioner Oliver. Does not the freight generally average from 5s. to 9s.? Mr. Hewitt. I beg your pardon. I controvert it. Fifteen shillings is the price. I contradict it absolutely, and want it to go upon the record. Commissioner Oliver. That is a matter very easily settled. Mr. Hewitt. Certainly, and therefore I contradict it so positively. It is from 15s. to 20s., and very often 20s. Commissioner Oliver. In 1879 I know of my own knowledge that ore was brought at from 5s. to 8s. Mr. Hewitt. Where from ? Commissioner Oliver. From the Spanish ports. Mr. Hewitt. I do not contradict anything you know of your own knowledge. I merely say that such a thing never came to my knowl- edge. Commissioner Oliver. At the same time, last year was exceptional I am speaking of the importation of these ores now. Mr. Hewitt. I brought the first cargo of Spanish ores myself, and paid 22s. I never heard of 5s. or 8s. being paid. The Anchor Line run- ning to the Mediterranean may take it in as ballast or take it free, but this trade last year ran up to about 700,000 or 800,000 tons, and of course that ends the ballast question. Anybody can see that 5s. to 8s. would not pay any vessel to bring it from Spain or Africa to New York. Commissioner Oliver. I am speaking of sailing vessels. Mr. Hewitt. It has ceased to be a matter of sailing vessels. It is mostly done by steam. There are some sailing vessels engaged in it. There are not only the ores, but there is scrap iron, scrap steel, scrap cast iron — three forms in which iron comes in. The manufacture of these articles is not a business. The whole world is engaged in making scrap, but nobody pursues it for a livelihood. It is the result of the friction of civilized life, and therefore you protect no industry by putting a duty upon scrap materials, upon waste products generally, and I speak more particularly, now, of iron. You may get revenue by this means, but if you find that the imposition of a duty interferes with the progress of business and hinders manufacture, then it is an unwise thing to put a duty upon it. Scrap iron is subject to a duty of $8 a ton, cast iron $6, and old railroad iron $8. I would have them free just as I would iron ore. I would make them free because they would cheapen the cost of the manufactured product to the consumer, because they would very much enlarge the business of this country. At present The scrap accu- mulated in the West Indies and South America is shipped to England, where it enters free and is manufactured and sold there. But if this $8 a ton duty were removed, a very large proportion of it, if not the whole of it, would come to this country, and we should be able to do this manu- facturing, whereas it is now done somewhere else. It would therefore enlarge the area of labor and give employment to more men. That is one side. On the other side, you will be told that it will interfere, not with the manufacture of scrap iron, for there is no such thing voluntarily, but with the manufacture of pig iron, with which scrap iron comes into com- ABIIAM 8. HEWITT.] IRON AND STEEL. 1087 petition. To that I answer that pig iron, is used just in proportion as you can use scrap iron. Scrap iron is not much used alone. It is in some cases used without admixture, but, as a rule, it is more economical to use scrap iron with puddled iron from pig. Therefore I do not think it would narrow the market for pig iron. But whether it would tend to narrow or enlarge it, I would still make it free, because I think that the manufacture of pig iron at the present rate of duty could stand perfectly well any competition that might come from scrap, although I do not think it would be of any moment, as I have said. The introduction of iron ore free would, in my judgment, enable us to reduce the duty on pig iron to some extent. I think if we made scrap free we might bring pig dow T n certainly to $6 and preserve the relation which now exists between the two. I do not think pig iron would be damaged. I want to note here that I am a consumer of scrap iron to a very considerable extent. I do not want my position misunderstood. The whole amount, I think, does not exceed 20,000 tons a year certainly. While my firm are personally the makers of about 50,000 tons of pig iron in a year, we are interested in making 50,000 more. In other words, I have a personal interest in the manufacture of 100,000 tons a year, and, as a pig-iron maker, I am in favor of scrap iron being free, and I believe I shall gain ; but whether I do or not, I believe the country will gain, and I earnestly urge upon the Commission to recommend that it be made free. Charles E. Smith, at one time president of the Philadelphia and Beading Bailroad, made a strong report in favor of making it free, but the report was met by a howl of condemnation from one end of Penn- sylvania to the other, and Congress was frightened and the duty was left on, very greatly to the detriment of Pennsylvania. Of course, if you report in favor of it, you will probably be met with the same amoitut of condemnation, and I put this in evidence, that I take part of the re- sponsibility on my own shoulders if I can. Those are the main points in regard to iron. In regard to steel : I suppose everybody admits that the duty upon steel is out of all reason. It was a very proper duty at the time it was imposed. It was equivalent to an ad valorem duty of about 30 per cent., and did not represent the real difference in the cost of labor ; but in the progress of things and the development of business, it has now got to be a duty of about 100 per cent., and there is no justification for it from any point of view. N The duty has now ceased to be a revenue duty, and the domestic price has now got to be below the foreign, and the government is not able to get the full benefit of the duty of $28. My own standard for fixing the duties is, as far as possible, to equate the t>rice of labor between the competing countries. You can only conduct busi- ness by imjmsiug such a rate of duty as will compensate for the difler- ence in the cost of labor. My own figures are, somewhere from $12 to $15 will be adequate for the steel-rail business. My own opinion is $14 per ton should be the duty imposed upon steel. If you remove the duty upon iron ore, of course you have given them an additional bene- faction. If you reduce the duty on pig iron by $1 or $2 a ton, then you will give them an additional benefaction. You ask w 7 hy I would reduce it at all; if the duty has ceased to be protective, what is the use of bringing it down ? I answer this : That the consumer wants protection when there is an active demand and high prices. Therefore, when i>rices begin to go up, if the consumers can go abroad and buy steel subject to a duty of $14 instead of $28, they are protected to that extent. As $14 is ail that is needed, I want to give the consumer the benefit of the other $14 no longer necessary. I want the lowest rate of duty which you can 1088 TARIFF COMMISSION. [ATJRAM S. IIEWITT. adopt to give tlie government adequate revenue, and the existing indus tries the protection which they need in bad times; that is to say, the difference between the rate of wages in foreign countries and the rate here. And I will say always, under all circumstances, it should be the lowest rate of duty that can be imposed with due regard to the Treasury and to the existing industries of the country, and not the highest. Commissioner Ambler. In the case of steel rails that would be about 50 per cent, duty? Mr. Hewitt. The present price of foreign rails is about $28 ; it would be about 50 per cent., and that is as much as I can figure it out for the difference in -the rate of wages. Steel is produced by human labor ; there is so little that is not that it is very difficult to estimate it. But in 100 tons I doubt whether 5 per cent, consists of things that have gone out in the wear and tear. But the steel business differs from the iron in this : We have been able to apply machinery to all the pro- cesses of its manufacture ; it is almost automatic. The quantity of la- bor is only about $5 a ton, whereas, in old times, if we got off with $15 a ton on iron we thought we were doing well. I should think that, as a rule, the actual labor for converting pig into iron or steel is about one- third of the quantity necessary for the production of iron. The whole process is a machine process. The men are used for attending machin- ery instead of manipulating., Of course in rolling there is an applica- tion of physical force to some extent, but even that is very nearly auto- matic now. Commissioner Ambler. Do you desire to say anything else in refer- ence to any other class of iron ? Mr. Hewitt. I am ready to answer any questions as to other classes of iron. Commissioner Oliver. In regard to pig iron, do you take into con- sideration that there was a half million tons of pig iron imported last year ? Mr. Hewitt. Yes, to make Bessemer steel. Commissioner Oliver. At the present prices of steel rails will there be that great quantity or a proportionate quantity imported this year ? Mr. Hewitt. There will be, unless we learn to make Bessemer pig iron. They must get pig iron from some quarter. We make it on Lake Superior from Lake Superior ores. Increase that product and you will cease to import the other. Commissioner Oliver. I do not see that it is a very good way to keep from making it by reducing the duty on it. Mr. Hewitt. We reduce it by domestic competition. I am inter- ested in three blast furnaces on Lake Superior, and that region is alone capable of supplying not only this country, but of supplying the whole world with pig iron. It is a mere question of putting capital there. Commissioner Ambler. Is it not a fact that the Iron Mountain ores are good Bessemer ores ? Mr. Hewitt. They are good ; but they contain silica, and it is more expensive to flux it out. The Lake Superior are the more desirable ores, but you cannot make steel from the other. We have on Lake Cham- plain large deposits, and more is being found every day ; and in New Jersey, where we supposed we had none, we are getting out large quan- tities of Bessemer ore. Commissioner Ambler. The reason I made the suggestion was be- cause I so understood you. Mr. Hewitt. No, sir; we are mining some Bessemer ores to-day in the Eastern States, but not enough to supply the demand. If we could, ABRAM S. HEWITT.] IRON AND STEEL. 1089 there would not be a pound imported. We sell American ores, and can afford to sell them at a less rate because we have not this enormous freight to pay. In regard to the duty on iron, it is a pretty complicated question. There are some branches of the iron business very inadequately pro- tected, so to speak, by the taritf as it stands to-day, while there are others very much over-protected. The only way to deal with that is to take each article by itself. Take off* whatever impediments are in the way of production. Take the case of cotton- ties, about which there has been an outcry. The duty there is not in proportion to the duty upon other branches of iron manufacture ; it is exceptionally low ; but if you take the duty of $8 a ton otf of scrap iron you will enable hoop iron to be made at three-quarters of a cent a pound cheaper than it can be made now by anybody, and that is equivalent to the duty on cotton -ties. In every department you will find little peculiarities which an intelligent man will point out. Take wire, for example, which is used in making barbed-wire fence. The farmer is the great consumer of that article. The government gets $8 into the Treasury, which the consumer lias to pay ; the manufacturer of barbed wire does not get it. At present, if it was not for the patent upon the article, the manufacture of barbed wire would be under very favorable conditions indeed, because steel rod comes in at 30 per cent, duty at present. You cannot make a ton of American steel wire except it is in competition with the foreign. Hence, they imported 60,000 tons of steel rods this year at a very much lower rate than they could be produced here. Commissioner Oliver. It was stated in Chicago that there were 150,000 tons imported. Mr. Hewitt. My information is 60,000, and I got the information from a person who imports rods. Our works are at Trenton. At that place we have been making wire for thirty years, and have a really wonderful mill, where we roll 40 tons a day. We are importing our steel-wire rods from Germany and Belgium and England, and drawing the wire in Trenton and sending it out to the farmers. You naturally say, “ Don’t you want the duty raised on wire rods?” u No,” I answer. u I don’t want you to put on that $8 a ton, which is equivalent to say- ing that I shall not make wire from scrap,” and that is what you do by the present tariff. Commissioner Ambler. That $8 a ton is on scrap iron! Mr. Hewitt. Also on steel scrap, and if I can have scrap steel free I can melt it down and make my wire of it. The duty upon steel is an ad valorem duty, and that upon iron is a specific duty. Commissioner Oliver. The duty on cotton-ties, I should judge, has not averaged over $11 a ton. Mr. Hewitt. I cannot give you the figures. Commissioner Oliver. Would you deem it consistent to suggest that the duty on steel rails be made $14 and the duty on cotton-ties be left at $11. Mr. Hewitt. No. Wliat I say about cotton-ties is this: The duty on cotton-ties should not be less than the material from which they are made. If I find that that duty is not enough, then I will come to the Commission with a good face and say that duty is not sufficient to enable us to make them. But so long as there is an artificial impediment in the way I cannot come with a good face. I would make things bear relations to each other, and for that reason it would be necessary to take up the schedule in detail and consider each question by itself, bearing always in mind the principle that the duty must be kept off the raw material in H. Mis. 6—69 1090 TARIFF COMMISSION. [ABRAM S. HEWITT. every form, and only put upon the manufactured products at the point where they can be affected by the maintenance of some existing duties. Commissioner Kenner. How many tons of scrap iron are introduced into the United States? Mr. Hewitt. It is a very considerable amount, and varies from year to year. I should think, in round numbers, it must be as much as 200,000 tons a year at times. Commissioner Kenner. Be kind enough to inform us what is the amount received in England. Mr. Hewitt. Ko; I cannot without looking at the tables. They get a great deal of their scrap iron from South America and Cuba. Commissioner Kenner. Can you not form any opinion as to the amount received in France or Germany? Mr. Hewitt. The amount received is large. Great Britain is an enormous exporter of scrap iron. For instance, we get most of our old rails from Great Britain, and we are able to pay better prices for them than they can get there. They came over here for a long time to be rerolled into American rails, and I have seen thousands of tons of it on the Pacific Railroad, where they were required to use American rails. They last about two or three years. Those on the Pacific road have all been renewed since by steel rails. Commissioner Kenner. If we admit scrap iron, to what extent would it affect the iron interest ? Mr. Hewitt. Ko man can predict what the effect would be; but a great deal more would come in than now. I should think it would double the present importation. In my judgment, however, it would not hurt the iron interest at all; I think it would help the iron interest. Commissioner Porter. Three hundred and fifty-one thousand tons of scrap iron, including old rails, is the amount that was imported. Commissioner Kenner. You think it would double that quantity? Mr. Hewitt. I think we should import a great deal more, and it would enable a great many things to be done that are not done now. For instance, when rails were coming in the fish-plates would come in from the other side, but with cheap scrap we would supply our own fish- plates for our own rails. The relations of things change from year to year. The fundamental principle is that the more cheaply you can de- liver your manufactured article to the consumer of the article the bet- ter. That doeh not change. Commissioner Oliver. That is, provided you have the raw material yourself. Mr. Hewitt. If you could get it cheaper yourself the consumer would get it cheaper. My own idea in regard to the mode of assessing duties is that under all circumstances duties should have reference to value. Values change very much. Ad valorem duties open the way to great frauds. They have been the source of great frauds under the present tariff. It is always an open question to a man how he should invoice, and unfortunately our law requires three different standards of invoices on the other side, and the law punishes him for making his choice. I think the judgment of the custom-house officers, merchants, and everybody is in favor of specific duties. The new French tariff is almost entirely specific; very little ad valorem. And I think nearly all tariffs now are specific. The question is to accomplish the ad valorem principle with a specific application, which is desirable. My own view is that the market value of the pres- ent day should be taken as the basis — the average market value of the last three years — which is the basis I laid down in my speech; that you ABRAM S. HEWITT.] IRON AND STEEL, 1091 should convert the ad valorem rate into the specific on that basis. That would do for the present, but values will continue to change. It I had the making of the law myself I would require the Treasury De- partment every year to drop out one year and put in the last preced- ing year, always taking the average of three years, and then publish the schedule. They ought to give at least six months’ notice of it in advance. But always collect the duty specifically, and always impose it on the ad valorem principle. I believe that would work. Commissioner Ambler. That remark would apply to other articles which may properly be made the subject of specific duty as well as iron. Mr. Hewitt. I think it the fundamental principle that underlies the whole thing. Commissioner Ambler. Of course it could not be universally applied. Mr. Hewitt. We have mixed duties to-day, and they are very much complained of and are open to great objections; but there are some things in regard to which it seems almost impossible to adopt any other system, unless the suggestion I make is adopted, of taking the average value year by year and making the schedule correspond. Take wire, for instance, one of the most difficult things to deal with. Wire is of all sizes, from the fineness of a hair up to the thickness of your finger, and they depend upon their size for their price ; the smaller the wire the higher the price. There cannot be a specific duty upon each number; No. 40 is the limit. That would be very intricate and very much in de- tail, but by adopting a basis of duty which applies to the large numbers, and putting an ad valorem rate in addition as you come down in the size, you make it very easy. That is one of the cases where the mixed system would be good. There are one or two other articles, such as silk goods, for instance, where the same principle would apply. Commissioner Oliver. I did not clearly understand how the changes of those three years would be made. Mr. Hewitt. Begin by taking the last three fiscal years and ascer- taining the average prices for those years. Then you have a basis of value. Upon that we will assume you have a duty of 35 per cent. Multiply it by 35 and get the specific rate which you impose upon that article. Next year you will have entered into a new period. You then drop off the first of the three years and add the then present year, and again take the a\erage in the same way. That would be an aver- age changing from year to year slightly. This difficulty about steel blooms would not have happened if the duty upon them had been ad valorem ; in that case it would have accommodated itself to the market. Commissioner Oliver. Would it not give too much power to the Treasury Department? Mr. Hewitt. It does not give any power. They have nothing to do but to set a clerk to figure up the average; it is automatic. Commissioner Porter. Would it not entail a very large amount of labor ? Mr. Hewitt. No, sir; not as much as now in making up the books. Suppose you have 4,000 articles in the tariff. You make this computa- tion. The average price is given now by Nimino’s computation for three years. The fluctuation is by the year, and the average price is on the three-year basis. Commissioner Porter. Nothing would be stationary. Mr. Hewitt. Year by year there would be fluctuations, but six months’ notice should be given by the Treasury. Iu other words, if the computation is made on the 1st of January in one year, it should take effect on the 1st of July. 1092 TARIFF COMMISSION. [ABRAM 8. HEWITT. Of coarse I do not want to enter into a general discussion of the tariff question. That is a matter which I reserve for another sphere. My object in accepting your invitation was to give you the practical information which my own business has furnished me. Commissioner Oliver. In your judgment, is it not absolutely neces- sary that the law be revised and changed? Mr. Hewitt. I have done little else for six years but press upon the public and Congress the absolute and indispensable necessity of it. I have been the advocate of it in Congress and out. I believe that the tariff* is very crude, badly constructed, very unfitted to the needs of the American people at this time, and ought to be revised, and revised in the interest of reform. As I said before, there ought to be the lowest possible rate of revenue so as not to interfere with the interests of any substantial business. Personally, I would go much farther. If I had the making of laws I would never have any tariff. We are where we are as the result of legislation which has lasted one hundred years, with hundreds of millions of capital invested in what are called protected industries and hundreds of thousands of people employed — people who cannot be turned out of employment. Therefore you must take into consideration all these interests. Upon some of them there are very much higher duties than seem reasonable. There are some interests that will die even with duties of 60 to 70 per cent., but there are some others that will flourish with duties equivalent to 20 per cent. The census returns enable you to see how some parts of the United States are wronged by the tariff*. Do not let these wrongs grow. In the mean time, take the road of reform and follow it as far as you can without injuring any part of the country, but always travel in the direction of lower duties, because if you do not, the stream will over- flow some day and carry all before it into a common ruin. The cost of production is now made too dear, by legislation, to endure permanently. C. C. STURTEVANT.] WHEAT AND FLOUR. 1093 C. 0. STURTEVANT. Minneapolis, Minn., September 14, 1882. C. C. Sturtevant, secretary of the Minneapolis Board of Trade, addressed the Commission as follows: The two great interests which have built up our city and this neigh- borhood have been the lumber, originally, and the dour mills. The manufacture of dour to day is probably the largest manufacture in the Northwest. The first mills (that are now standing) were built in 1860. In that year there were shipments of dour from here of 30,000 barrels. The shipments continued to increase until in 1873 they amounted to 585,000 barrels ; in 1881 it was 3,142,974 barrels. In that year we used about 16,000,000 bushels of wheat, which was about 2,000,000 more than the entire receipts of wheat in Chicago that year. Our receipts were 17,000,000 bushels, and 16,500,000 were manufactured into dour here. There was no dour imported until 1878, and we had no foreign trade at all until 1878. In 1878 one of our millers went abroad for the pur- pose of trying to introduce Minnesota dour into England alone. He spent a whole year there, until he had some shipped there and tried. But the result was that during that year 109,183 barrels were shipped. It was of medium grades of bakers’ dour. There was none of our fine dour exported that year. The trade was extended, and was mainly the first year to Liverpool, Glasgow, and London ; Brazil took a little. The next year it was extended to the Continent, and next year still farther, until nearly every port in Europe took our dour, and several shipments were made to Alexandria, in Egypt. Now, that trade has been built up by the energy and enterprise of one of our millers by going and staying right there until he could get the dour introduced. To-day there is not a line of steamers going to Europe that has not its agent here for the purpose of enabling us to ship it with greater convenience. Then comes in an incidental question in regard to the tariff. Mani- toba is now raising immense quantities of wheat, and the quality of it is much better than ours. We have samples here that were raised 500 miles northwest of Winnipeg, and are superior to any samples in Min- nesota. There is a duty of 20 cents on every bushel of wheat that is brought into this country to grind from Manitoba or any other foreign country. There has been a ruling of the Secretary of the Treasury that where dour is manufactured exclusively from imported wheat there is a rebate of 90 per cent, of 75 cents on each barrel of dour exported. That was found altogether inadequate. Various experiments have shown that it takes about 4 bushels and 40 to 50 pounds of this north- ern wheat to make a barrel of dour. During this winter or spring the Secretary of the Treasury has made another ruling, by which he gives us 90 per cent, of about 1)0 cents. Before we had 67 cents rebate on Manitoba wheat or dour; now we have 80^- by the present ruling of the Treasury Department on each barrel of dour, and it saves the miller a vast amount of expense and annoyance. The wheat has to be subject to the inspection of the Treasury agent from the time it crosses the line until it is exported, and we cannot get the rebate until it has been out of port a certain length of time. The question has been agi- tated whether or not we might not have free wheat from the British 1094 TARIFF COMMISSION. [C. C. BTUBTKVANT. provinces to this country to grind. Of course it will he said that it would be putting their wheat in competition with our American wheat. But then it strikes me — and I think investigation will prove — that it would make no difference with the foreign demand for our American wheat. The wheat raised there, if it is not put into flour, will go abroad and supply the foreign markets in the barrel. Now the ques- tion is (inasmuch as they must have just so much of our wheat and no more), whether or not if it comes here and our people grind it and re- tain the offal here and then ship that flour abroad the farmer will be in- jured by it. That is a question for others to decide. My own impres- sion is that they would not. The foreign markets will take no more wheat than they want. Great Britain will take wheat raised in its own colonies before it will take ours. Another matter, in regard to our trade with Manitoba in manufactures and the trade generally with Manitoba: They have recently put a very heavy duty upon all American goods taken into that country. We have a very large number of manufacturers here who had a very profitable and good trade with Manitoba previous to that tariff placed upon our goods. For instance, the agricultural implements used there were almost exclusively of American manufacture. We had a large trade in agri- cultural implements, in furniture, and machinery of all kinds, but we have virtually lost it. They impose a duty of 35 per cent, on furniture, which, of course, virtually excludes our goods. Some claim that that w as put on as a retaliatory measure as against our twenty cents a bushel on their wheat coming here. The Northwest is very much interested in that question. This is their natural place for trade. From time im- memorial their business has been done here almost exclusively. Of course, some of it will probably be diverted by the Canada Pacific Railroad, but as the interests of the Canada Pacific and the Manitoba road (which comes here) are practically identical, they are striving to draw that trade this way. I can give you some figures in regard to our general manufactures. Last year there was manufactured within our city limits hereof lumber 234,245,000 feet, besides shingles, lath, and other material. Of mis- cellaneous manufactures, largely of farm machinery and other machinery, furniture, and builders’ materials and things of that kind, the total value was, say, $14,872,000 in 1880, showing a gradual increase. I would say here, in regard to flour, that the capacity of our mills now is a little over 25,000 barrels daily, and of that flour we expect this year to export about one-half. By Mr. Boteler : Question. Recognizing the necessity of your mills to draw their sup- plies from a more extended area, 1 cannot understand why that can be an advantage to the agricultural community of this country. — Answer. I do not think it would be to the advantage of the wheat grower, but I do claim that it w r ould be no disadvantage ; and if it brings money and business here, or manufactures, or anything else, and does not take from the profits of tbe agriculturist, it is a benefit to the w r hole. My argu- ment is this: Foreign countries want 200, 000, 000 bushels of wheat or its product, flour; Canada or the British provinces raise 100,000,000 of that and send it unmanufactured to Europe. Of course they only want 100,- 000,000 more from here. If that 100,000,000, which is going there at any rate, was brought here and manufactured and then went there, they would not require one bushel less from this country. c. c. stcrtev ant . ] WHEAT AND FLOUR. 1095 Mr. Botelee. That is a strange presumption, tliat England will re quire that amount regularly. The Witness. Foreign countries do not buy any more breadstuffs than they require. They buy that from the country where they can buy it cheapest, and England takes the largest portion. They always take what is raised in their own provinces before they take ours from here. The Canadian provinces have no other market than a foreign market for their wheat, unless they bring it here, and they cannot afford to do it with the duty on. Last year England alone took about half as much as it did the year before; they did not need it, and if they do not need it they are not going to buy it. Q. What is the capacity of your, mills'? — A. They can easily make 25,000 barrels per day ; that is their capacity. The smallest mill has a capacity of 225 barrels a day. Q. Is there not wheat enough raised here in this region to supply them ? — A. Usually, when there is a good crop, but last year there was not half enough. Q. When there is not a good crop, of course the price of wheat is en- hanced and will just about pay the additional duty upon the supplies, will it not? — A. We always raise a good deal more wheat than we can consume at home. If that wheat goes to Europe, of course it reduces the price of wheat there, and the price is reduced here. We do not make the price of wheat here, Europe makes it — only sometimes the board of trade of Chicago makes it, as they did in July and August. But ordi- narily and regularly the price in Liverpool regulates the price here. .We do not ship any wheat to Europe; we ship Hour. By Commissioner Garland: Q. The rebate under the recent ruling of the Secretary of the Treasury practically makes free trade, does it not? — A. It is 90 per cent, of the duty paid that is returned, leaving 10 per cent, of the duty for the government. By Commissioner Ambler: Q. It is nine-tenths of 20 cents that is returned ? — A. That is two cents a bushel for the government; we do not get any rebate on the offal. By Commissioner Garland: Q. Do you not get a rebate on all flour? — A. It takes about 4 bushels and 3 pecks to make a barrel of flour — call it 5 for short; 20 cents a bushel on 5 bushels would be $1; but you only get that 90 cents. It is about 3 cents a bushel when you come down to it actually. By Commissioner Kenner : Q. Do you recollect when the duty of 20 cents was laid on wheat ? — A. I do not. Q. It was in March, 1861. Since that time the country has improved very remarkably, and there has been no complaint among the consumers. You state, however, that your trade is falling off between here and Manitoba. — A. Yes, sir. Q. As you cannot furnish the furniture and agricultural implements to them, on account of their tariff, will not the consequence be that the manufacturers will go there and make it there ? — A. I think it will event- ually Q. Do you think it wise policy in us to let the Canadians furnish us 1096 TARIFF COMMISSION, [C. C. STURTEVAKT, with furniture, &c .? — A. By no means. T would not have the duty taken off the wheat unless they would take it off" of our articles. Q. We have no control over the Canadian Government. This Com- mission can only propose legislation to Congress. The Canadians saw great prosperity on one side of the line where there was protection, and great depreciation on the other where there was free trade ; and now that they have adopted our policy shall we change ours ? — A. Prac- tically we had free trade with Canada until within the last three years. Q. Do you think that the adoption of the policy of protection by the Canadian Government is the result of the fact that the disposition on the part of the people for annexation was developing so rapidly that they had to adopt our policy in order to prevent, the increase of that feeling? — A. The Canadians have virtually cut loose from the old country. Some of them are very strongly in favor of reducing their tariff; they say it is injuring their northwest. I think the sentiment in Manitoba is decidedly in favor of nearly free trade between us and themselves, and I think it is growing, and will be a power there within a very short time, too. Q. The adoption by them of a protective policy injures us, there is no doubt about that. How it can injure us and injure them I do not understand. — A. They are paying 35 per cent, more for goods on account of that tariff, because the class of agricultural implements that they re- quire in the northwest are not manufactured in Canada. Those that have been shipped there are entirely inadequate for the work to be done, and they have had to come here and get plows, &c. Some of our largest manufacturers that have had that trade, and been putting their goods there and preventing manufactures there, have been sending their goods there without any profit, or none worth naming, and they have had to pay that 35 per cent. It is so with furniture aud everything. Those people have to pay a price clear above what they ought, and that is where it injures that country; it retards the settlement of that country. Q. That may be all very true, but shall we adopt their former policy of free trade since they have adopted the policy of protection, .and thereby have our section become depressed while theirs becomes pros- perous? — A. No, sir; as far as that is concerned, I am in favor of a reciprocity treaty and free trade between us and those provinces. Q. We cannot consider the question of a reciprocity treaty between us and Canada, nor can we consider the question of what the Govern- ment of Canada is going to do. Are you aware by what majority the protective policy was adopted in their Parliament ? — A. No, sir. Q. Are you aware that at the time when the Canadian tariff was adopted very little was said in the Canadian Parliament about the revenue ? — A. I am aware of it, and I am aware that the people were very much incensed at it. Q. We cau only judge of the people by their representatives in Par- liament. — A. Their representatives are very different from ours here. Q. You think that the flour manufacturers of Minneapolis are not satisfied wfitli the drawback which is allowed, when the law expressly states that the drawback allowed upon all foreign exportations of arti- cles manufactured in the United States exclusively from material ob- tained out of the United States shall be the same as the duty paid, less 10 per cent, for the expenses of the government. You get the offal, Ac., whir 1 ' is probably equal to the 10 per cent., and practically that reimburses you all you pay for governmental purposes. Do you think c. c. stubtevant.] WHEAT AND FLOUR. 1007 the flour manufacturers are not satisfied with that condition of things ? — A. We pay a duty on all offal ; we don’t get any of that back. Q. Is it not worth something to you ? — A. It is worth something, but it is not worth 20 per cent. — what we pay for it. By Commissioner Underwood: Q. I want to know by what line you export this flour? — A. We ex- port it by nearly every line leading out of New York, Boston, Balti- more, Philadelphia, and some by the way of New Orleans. Q. You send it over the railroad lines ? — A. Yes, sir. Q. You do not send any by water ? — A. We send by the way of Duluth. Q. What proportion ? — A. In the summer season, while the lakes are all open, we send from one-fourth to one-fifth that way, I think. By Commissioner Garland : Q. Do I understand that this grinding of Canadian wheat is pursued only when you cannot get wheat in this country? — A. Only when we have run short of wheat, so far. There was no Canadian wheat ground until the short crop of 1881. Q. Then in the event of a good crop in this country, this question cuts no figure at all ? — A. Probably not $ but still they have a better crop than we have. Q. I either did not get your meaning clearly or I do not agree with your reasoning. Might it not be that the free importation of this wheat would give the millers or the buyers of wheat at this point a little ad- vantage in this way • that they could say to the farmers : “We will 'give you so much for wheat, and if you do not choose to take it, we have plenty of wheat that we can get on the other side of the line, and will let you wait until you will take our price”? — A. Possibly it might. Q. Has such an argument been used? — A. Not at all. There is a great deal more wheat that comes from south of us than we raise here. Por instance, at this time we are receiving quite large shipments every day from Kansas. The Kansas harvest is much earlier than ours. Q. That would more likely unfavorably influence the Kansas wheat- raisers than the Canadian? — A. I think not. By the President : Q. Is there any superiority in your flour ? — A. Yes. Q. What is it? — A. It is in its strength. All this hard Northern wheat makes better flour, and the farther north the better. You may take a given quantity of our flour here, made from this hard wheat, and measure the water necessary to make it into dough suitable for baking, and you may take the same number of pounds of Southern wheat or winter wheat (the softer wheat raised farther south) and take the same quantity of water and put into it, and it is just about the consistency of paste used in pasting paper. The bakers state that the flour from the hard Minnesota or Northern wheat will make 20 per cent, more bread in size of loaf, in weight, and in use than the same flour from farther south. That flour was taken to Liverpool and London and left with the bakers and they were told to try it. Q. Then your flour will be likely to be received there in competition with flour from the Black Sea ? — A. Yes, sir. Q. Is there any advantage in your mode of grinding? — A. It gives the flour a better color, and they get more from a bushel of wheat. By Commissioner Porter: Q. Are there any statistics by which we can find out where the wheat 1098 TARIFF COMMISSION. (C. C. BTURTE V ANT. comes from*? Have you any board of trade reports on that point? — A. We have been prohibited, so far, by the railroads from giving au account in our reports of the amount coming in by the different roads. There has been a jealousy among the railroads here, and before we could get the daily receipts and shipments from the different roads we were obliged to pledge ourselves to mass them, without stating in de- tail what came in over each road. Q. Be kind enough to indicate by the map the region of country from which you draw your supplies of wheat here, so far as your knowledge goes. — A. We get some little from Manitoba; some is found as far north on the northern frontier as Bismarck — there is none beyond that — and then coming down the Missouri River we get more wheat, but the qual- ity does not suit. We get some in the vicinity of Sioux City and above, and then across in Dakota; some from Northern Iowa; but the bulk of our wheat that we grind now comes from Central and Northern Minne- sota and Dakota; wehave a little brought from Northwestern Wisconsin. Q. And occasionally, you s y, from as far south as Kansas ? — A. Yes, sir; but that is only when our stock is exhausted here that we go out- side of that range for wheat. Now this year this State is going to have a little over 40,000,000 bushels of wheat, which will be an increase of 8,000,000 or 10,000,000 over last year. A great deal of the wheat from Southern Minnesota goes to Chicago and Milwaukee. Q. What is Dakota going to give you this year ? — A. Probably from 10,000,000 to 12,000,000 bushels. Q. You will get most all of it ? — A. No ; we will get a good deal of it, but a good deal of it goes to Duluth and Buffalo. The Buffalo millers are, all through that section of the country along the Northern Pacific, buying it up. We will probably not get over half of it. We get some wheat from Southern Dakota by the Northwestern road and those other roads, but not a great deal. By Commissioner Ambler : Q. How far north of this does the wheat-growing country extend? — A. I suppose, from the best information I can get and from samples of wheat that have been brought here, it extends at least 1,000 miles northwest ol here, and the best wheat there is grown in that country. By Commissioner Porter: Q. Have you any idea of the product at the present time of the Mani- toba wheat region; have you any statistics? — A. No; I think they claim that they are going to have in that whole province from 15,000,000 to 18,000,000 bushels. Their wheat goes down the Northern Pacific to Dnlutli, and is shipped in bond through to Montreal and to Europe. There are bonded warehouses at Duluth, and the Manitoba road runs bonded cars. That wheat goes to Europe by the way of the lakes and the Saint Lawrence. By Commissioner Oliver : Q. Previous to last year they did not produce more wheat than they consumed, did they? — Yes, sir; they produced some more; we have had some of it here. It is only within the last two or three years that there has been any to export. They have some mills in Manitoba, but they are not very good. I knew the exact amount of it that went through Duluth in bond last year, but it has slipped my mind. What- ever surplus they have goes to Europe in some shape. WILLIAM W. FOIWBLL.l GENERAL VIEWS 1099 WILLIAM W. FOLWELL. Minneapolis, Minn., September 14, 1882. William W. Folwell, president of the University of Minnesota, appeared before the Commission and made the following statement: Mr. President: I did not expect to have the pleasure of saying any- thing in the presence of this Commission. I did hope, however, to at- tend the discussions before the Commission, because I am much inter- ested in the general question of protection and free trade. 1 am a free- trader; that is to say, I believe that free trade is the ideal condition of commerce and of industry, and that this ideal condition maybe realized at some time on this planet, in some Utopia yet to be. Men ought to live together as brethren and ought to desire the welfare of each other, whether as nations or as individuals. But unfortunately we live in this nineteenth century, and the principal business of men is cutting each others’ throats, either physically or financially. And so long as this condition of things continues I am, as I say, ideally and theoretically a free-trader, while practically a protectionist. I think we Americans must do as other peoples do, that is, we must protect our industries, or some of them, from injurious competition on the part of other nations who do not desire our prosperity. ’ Believing then that w T e must protect our industries, it seems to me that we must be careful how we do it. There is such a thing as under- taking to protect everybody and not protecting anybody. We do not want to be in the condition of the old man and his five sons who traded coats all day and at the end had each his own coat. We can only pro- tect particular industries in my opinion, at the expense of other indus- tries in general. If we attempt a general scheme of protecting all call- ings, of course, the whole thing will be a failure. Then it comes down to special protection of a few industries. The great mass of industries do not need protection, but will take care of themselves. I am heartily in favor of taking care especially of infant industries, which need to be cared for until such time as they can get along on their own feet. As protection cannot be made universal, neither can it last forever. It must come to an end. Every protective system should look not to its perpetuation but to its own extinction. It should work out its ends and leave all industries at length to take care of themselves. And right here I might say, as I have already been requested to, what occurs to me about how our western people feel in regard to the tariff. So far as I have been able to observe, they do not care a great deal about the matter. They have not much interest and have not much information upon the subject. Our business is so exclusively and overwhelmingly agricultural that our attention has not been drawn to the subject of protecting manufacturers. It is difficult to get any po- litical party to put a protection plank in its platform, and if they do it at all, it is done in deference to tradition more than because they really desire the extension or the perpetuation of a protective policy. I concede, then, that protection is, in our time, essential; but I insist that comparatively few industries must be protected; and that protec- tion must look forward to the time when it can be dispensed with. I do not believe, to speak frankly and plainly, that the people of the Mis- 1100 TARIFF COMMISSION. [WILLIAM W. FOLWELL. sissippi Valley, which is going to control the whole policy of this coun- try, will carry protection indefinitely. So that if I were called upon to legislate I would endeavor to formulate a scheme that would, within a reasonable time, come to an end. The indefinite continuation of a tariff* presupposes the means of spending unlimited money. The pres- ent state of things will not always last; we shall pay the national debt, and then what shall we do with the immense income resulting from an indefinite tariff ? Even now the high-tariff men are urging the abolition of the internal revenue in order to give room for increased revenue from duties on imports. I do not think of anything more at the moment, but I should be very glad, if I can do so, to answer any questions which may be put to me. By Commissioner Kenner: Question. You advise us not to have general protection, meaning thereby to select special industries, particularly those that are termed infant industries. I understand that to be one of the suggestions you make? — Answer. In substance. Q. Some parts of our country are very old and others very new, and the surrounding circumstances of different localities are quite varied. We do not find infant industries in every locality. For instance, the cotton industry in the South is nn infant industry compared with the cotton industry in the Eastern States. In the East they have arrived as nearly at a state of perfection as possible. They have arrived at the full English standard of perfection in machinery, while in the Southern States you will find that manufactures are just beginning to grow — not out of their swaddling clothes yet. How, then, can we protect the in- fant industries of the Southern States when the same law must govern the Southern States as governs the Eastern States? Can you suggest any method? — A. Ho, sir; I do not think I can suggest any method which would be general. I look upon this whole business of protection as a practical business. The men charged with framing a system must sit down together and figure it out the best they can under the circum- stances. What I am insisting on is this, that if we attempt to protect every industry in the whole range of manufactures and agriculture,' the effort will defeat itself. I see the point you make, but I have nothing to suggest in a general way, because when a commission sit down to make their recommendations they must do just what they can. The outcome must be just what this commission shall vote, and not what theorists would have. By Commissioner Oliver : Q. You speak of a gradual reduction of duty so that eventually we would work to a point where it might be called free trade. Have you taken into consideration the fact that the nearer we approach that posi- tion the lower we reduce the wages of what are called the working peo- ple? — A. I think that is correct in certain particulars. Q. 1 mean generally. — A. I am not sure about it in general, but I think in certain particulars a case can be made up. The wages of labor depend so much upon movements of population that I do not think a tariff can regulate labor very much. It is oidy one of the elements. I do not believe that any tariff Congress shall make in consequence of your recommendations will really help the laboring classes permanently. That depends so much upon emigration. Q. Have we not attracted that emigration for the reason that we have rich lands and high-priced labor? — A. I think we have; chiefly, though, because of our rich lands. The price of labor depends so much upon WILLIAM W. FOLWELL.] GENERAL VIEWS. 1101 other considerations than that of the tariff on goods that I would not be willing to admit that the resuff of free trade would be a reduction of the price of labor. We are asked now to protect labor. I have lately seen a resolution of a labor association asking that $100 a head be put upon laborers imported into this country, and I do not see but there is some reason in that. Q. It has been suggested to us that the duties on heavy products might be taken off or materially reduced and thereby lower the price of those heavy goods from abroad. In that case these men who now pop- ulate the cities would at once come into competition with the wheat-pro- ducers and corn producers. — A. That is going upon the assumption that the abolition of duties is the abolition of manufactures. I do not ex- pect general free trade in our time. I think it ought to be at least a century working out, and I would not think it necessary to assume that unlimited free trade would be necessarily accompanied by a reduction of wages. Q. You speak of the surplus money that the government would be possessed of after the debt shall have been paid. Do you not think that articles that are not produced in this country should be put on the free list and then there would be no surplus revenue? — A. When you come to that, this Commission is so much better informed than I am that I dislike to venture any opinion. I dare say it might be the case. I think that very likely, especially when the amount of revenue therefrom should be very small. By Commissioner Kenner: Q. There are two theories of raising revenue: by excise duties, and duties on imports. Your idea is that internal revenue would be prefer- able to the duties on imports? — A. 1 take a very practical view of gov- ernment. I assume that there is a general science of political economy; that there are certain general principled which are inductions from facts observable to all countries; that this science presupposes absolute free- dom to consume, to produce, to exchange, and to travel. This is a very fine theory for the class-room and the study. The teacher can analyze it and teach it. The trouble is that it does not specially apply to this country or to any particular country. There is then an additional sci- ence of national economy, and the business of national economists is to apply the principles of political economy to the exigencies of their times and countries as far as possible. The same is true of moral philosophy. The moralist will tell you you must not kill anybody, and yet you may kill thousands upon thousands for state reasons. The political econ- omist suggests that you must not interfere with anybody’s industry ; that everybody must be allowed to produce and consume as he pleases; but the national economist will come forward and say, abolish this in- dustry entirely, check this one, and give that one a new direction, and will justify himself upon considerations of public policy. In that way I escape from the difficulties into which I think many political economists fall. The ideal conditions of mankind must be adapted as they can be to particular times and particular nations. By Commissioner Ambler : Q. So that political economy, in its largest sense, will not be available until we reach that Utopia you mentioned? — A. I would not like to an- swer yes. Nobody denies that moral philosophy is a valuable science, spite of the universal prevalence of immorality. Commissioner Ambler. I said available in its largest sense ; I did not mean that it would be of no use. 1102 TARIFF COMMISSION. [WILLIAM W. FOLWELL, By the President: Q. Do you hold in practice that national interests override and over- rule general theoretical questions? — A. Certainly. You business men must sit together, and the outcome must be the result of your votes, and not of your theories. By Commissioner Boteler: Q. Your idea is that in the present exigencies of the country, where a certain amount of revenue must be raised, it is better to be raised by duty, and that we should select certain industries to be protected in that way? — A. Certainly; I agree to that. I think it would be a great wrong to abolish the present tariff suddenly. It should be perpetuated for a generation or two, because of vested interests. By Commissioner Kenner: Q. You did not intimate whether you thought that these revenues ought to be raised from imports, in preference to excise duties ? — A. The honest way to support the government would be for every man to put his hand in his pocket and pay his share of direct taxation. I think, however, considering the habits, feelings, and conditions of our people, that the revenue from imports is, on the whole, the more desirable method. We do not take kindly to excises in this country, though I think we stand taxation upon luxury pretty well. A tax of 2 cents upon every bank check is a tax which makes us angry every time we write a check. By Commissioner Boteler: Q. You do not think the people like the idea of a man coming around annually to collect the amount of revenue necessary ? — A. I do not think they do, and yet I wish they did. Q. Which do you think would be the more desirable, that the tax- gatherer should go from place to place to collect taxes, or that it should be taken from them without their being conscious of it, so to speak? — - A. As an abstract question I would think it. far more desirable to pay openly and honestly, and then every man would know what he paid. Q. But you are now speaking of practical business. From a business point of view is it not a great deal easier and would not the people tolerate it more readily and be happier under it, to raise it when they are not conscious of it, rather than to have to put their hands in their pockets and pay it over to the tax-gatherer? — A. I answer yes to that, meaning that they would be far better satisfied. As to whether they ought to be satisfied, I am in doubt. Indirect taxation is the resort of tyrants and demagogues whether they are aristocrats or democrats. I think for the present we had better go on collecting duties under the present arrangement and then let us all agitate and persuade one another that the better way is to abolish the duties on imports and let each man walk up and pay. Q. Do you not think that the present generation had better relegate that matter to the future ? — A. 1 think I do, since you force the question upon me. By Commissioner Kenner : Q. As a teacher of political economy, I take it for granted that you have observed the action of what are termed the civilized nations of the earth in the matter of raising the revenue, because that is one of the great factors in political economy which is to be studied and understood. Now, have you noticed that among the nations of the earth of which WILLIAM W. FOLWELL.] GENERAL VIEWS. 1103 you know anything, there has been a great disposition to return to what is called the protective doctrine? In England, where everything is as much on the free-trade principle as possible, the great revenues of the government are raised by the income tax, which is the direct taxation you referred to. Have you not noticed that in England there have been large meetings in some of the manufacturing districts, which were very clamorous a year ago for free trade in corn, &c., and they are now asking for fair trade, no longer calling it free trade; that the English colonists in Canada have actually caused the adoption of a protective policy by a ; arge vote in their parliament ; that France has refused to renew the reciproc- ity treaty between France and England, which was based on the idea that the products of one country should be admitted free of duty into the other; that in Germany, one of tha most prosperous countries in the world, Prince Bismarck has advised the adoption of the protective principle ; and that the same thing is occurring in almost all the enlight- ened nations of the earth; have you not noticed that the tendency has been in that direction ? — A. One must be very careful in making induc- tions. I have observed with interest the facts to which you refer. I have looked upon the matter in this way : The old policy of Europe was protective, as instanced by the British corn laws. Adam Smith’s “ Wealth of Nations” started the free-trade ball rolling. This system went to unpractical extremes, and there is now a reaction against it. The tide has set back of late years against that immense free trade wave which spread over Europe a generation or two ago. But I shall not be surprised if, in the course of the next generation, there shall be another corresponding reaction. Q. Then your idea would be that in political economy, as in everything else, the maximum should be in medio tutissimus ibis ; that we shall keep a happy medium and not get too much on either side? — A. And I would add this: That it is a matter of observation that the growing feeling in the West is that the tariff must come to an end; that it cannot last for- ever. By Commissioner Boteler : Q. Does not that feeling exist more particularly along the Canadian frontier ? — A. I am not sure that it does, and yet I do not know. The editor of our representative newspaper here, the Pioneer Press, is theo- retically a free trader, but is a man of sense and judgment, and he speaks for a very large constituency. Q. You spoke, in the early part of your remarks, of the people not being well acquainted with this tariff* question, and that it has not been dis- cussed during the present generation. Do you not think that there is a great deal ot* ignorance upon that subject, extending even to our public men, because of not having had an opportunity to become enlightened upon it ? — A. I am sure of it. Q. You know the average politician is not much given to books; he has not much time to devote to them. I speak of the average politician; of course there are statesmen in every community. As there has been no general discussion of the tariff* question, do you not think there is much ignorance upon the subject? — A. I am sure there is. I discover that as a teacher. I had a class of young men and women before me this mprning, and I asked them, “ What news did you see in the morning paper?” Some answered that they had seen accounts of a battle in Egypt. I said, “ Did you not see the news that the Tariff* Commission had arrived in Minneapolis?” and I asked them what the Tariff* Com- 1104 TARIFF COMMISSION. [WILLIAM W. FOLWELL. mission was, and not one of the seventeen or eighteen knew, and yet they are intelligent young people. Q. How old were they? — A. I should think perhaps twenty years old, on the average. They are young people picked up from all over the State. Commissioner Garland. That would bear out the idea that the press reflects the sentiments of the people. The Witness. 1 did not throw that out; I said the editor of the Pioneer Press had a Prge constituency. It is true we are ignorant of the whole business in the West. I do not suppose you would be able to find five men in this State, outside of the lawyers, who have ever read the tariff statutes. STEPHEN CLEMENT.] IRON AND STEEL. 1105 STEPHEN CLEMENT. Milwaukee, Wis., September 11, 1882. Mr. Stephen Clement, of Milwaukee, treasurer of the North Chi- cago Bolling Mill Company, made the following statement: The representative iron men in this State are now in convention at Cresson Springs, some distance from Pittsburgh, on the Pennsylvania Bailroad, and our interests will be attended to, and the action taken by that convention will be presented to this Commission. Our company employs between 5,000 and 6,000 men, all told, in the different departments of making steel and iron rails, bar iron, &c. There are about 1.500 men in this city on our pay-rolls. We pay for labor in this city from $60,000 to $90,000 a month ; averaging about $80,000 per month. By Commissioner McMahon : Question. Can you tell us when you will probably present that report to us that is now being prepared at Cresson? — Answer. No, sir; I can- not ; but I suppose very soon. By the President : Q. Are those persons, who are employed, all men ? — A. They are all males, but there are some boys. Q. How many persons do you calculate you support? — A. I should say between 4,000 and 6,000 people in Milwaukee. H. Mis. 6— — 70 1106 TARIFF COMMISSION. [WILLIAM SALTER. WILLIAM SALTER. Des Moines, Iowa, September 15, 1882. The following communication from Mr. William Salter, of Bur- lington, was read and ordered to be printed : To the honorable Tariff Commission : Gentlemen: I beg leave to submit to your candid consideration the question of the expediency of placing books upon the “free list.’ 7 The taxation of knowledge is especially objectionable among a people whose political institutions rest upon their general intelligence. It is a singu- lar anomaly to put a tax of 25 per cent, upon new books, or those printed within twenty years, while old books come in free; as though anti- quated and effete learning were best for our people, and we should be made to pay dearly for the latest knowledge. Would it not be more worthy an enlightened government to place no restriction upon the im- portation of books fresh from foreign centers of intelligence? For somewhat similar reasons I submit that the duty upon writing and printing paper should be reduced. Permit me to add that as an agricultural State the interests of the people of Iowa call for a low tariff* upon all articles that enter into the substance and manufacture of things that they use and wear. Our farmers and their families do as much hard work, and labor as many hours, and contribute as much to the wealth of the nation as the people in any of the manufacturing districts. The tariff for the support of the government should be made to rest no more heavily upon them than upon others. Trusting that your deliberations will result in causing the blessings and the burdens of the government to rest equally upon all who enjoy and share them, I have the honor to be, your obedient servant, Wm. Salter. Burlington, Iowa, September 14, 1882. HENRY J. PHILPOTT.] FREE TRADE. 1107 HENRY J. PHILPOTT. Des Moines, Iowa, September 15, 1882. Henry J. Philpott, of Des Moines, representing the Iowa State Free Trade League, stated to the Commission as follows: On behalf of the Iowa State Free Trade League, I beg leave to sub- mit to your consideration a summary of facts and opinions bearing on the question of tariff revision. As a preface to the important facts which I shall present, allow me to say that the league which I represent, and which has now about fifty active branches in the State of Iowa, has de- clared in a platform, adopted at one of its regular meetings, that any tariff at all must be a disturbing element in some line or lines of busi- ness ; and that the only tax on imports which should ever be tolerated by a free people is a tariff for revenue only. A tariff solely for revenue, with all incidentally protective features carefully avoided so far as possible, is entirely consistent with our definition of free trade, as it is with that of every political economist the world over, so far as I am able to learn. And I have to say that no revision of the tariff which does not look to free trade, thus defined, as its end and object, will be satisfactory either to me individually, or to theleague I have the honor to -represent. We are unalterably opposed to any avoidable law, or any avoidable feature of any law, which gives one private citizen of this free country power to levy taxes on another. I have to say, further, that as private citizens and taxpayers the mem- bers of this league are entirely willing and abundantly able to bear their full share in the support of the government, and that they are able and willing further to bear the burden of letting the protected industries down easy. We demand, specifically, that no sudden and violent revision of the tariff shall be made, even in the effort to reach free trade. We demand that the first reduction shall take effect not later than July 1, 1883, and that the free trade point be reached not earlier than July 1, 1887, nor later than July 1, 1890, and that after that period no tax shall be levied on any foreign article the like of which shall be produced within the United States to the value of over $1,000,000 in the last census year, except where the domestic article is correspondingly taxed, or if necessary for revenue, on a few articles of luxury. We demand that the taxes on domestic and foreign liquors and tobacco remain, together with other existing internal taxes, in order to make the neces- sity for tariff taxes as small as possible. Believing that all tariff taxes are a disturbing element in the lines of business they affect, we desire to see the dutiable list reduced to the minimum and the free list cor- respondingly increased, so that as many as jjossible of the industries of this country shall rest on the solid bed-rock basis of human freedom and unfettered commerce. We do not desire to engage in any business founded on an odious tax, and we are shocked and mortified that any- body in this region of boundless resources should desire it. We are sur- prised beyond measure that any one should say that high taxes are necessary to prosperity, or even conducive to it. Especially are we utterly astonished that any one who knows the natural resources of this country should charge that its fortunate possessors in a condition of freedom would be unable to keep pace with overcrowded and army- ridden Europe in the race for wealth and high wages. We flatly deny 1108 'Alt IFF COMMISSION. [HENRY J. PHILPOTT. this imputation against the enterprise and good sense and integrity of the American people, and we unhesitatingly charge that it is made in the interest of men who seek to profit, and do immensely profit, by the delusion. We are not ignorant of the relative prices of foreign and American goods. We know to a certainty that by far the greater part of the goods that Western people have to buy are enormously dearer here than in other countries, while by far the greater part of what they have to sell is worth much more abroad than at home. We pay $24 for a carpet that should sell here for $1G; $17 for a lady’s dress that should cost us not over $10 ; the same for the stuff for a suit of clothing ; the same for a shawl ; $9 for a pair ol blankets worth $4.50 ; 50 cents a yard for flannels that sell, where we sell the bulk of our surplus, for less than 25 cents ; $4 for a hat that should cost not over $2.50 ; $1 for a calico dress worth 70 cents ; $3 for a bolt of muslin that might be worth $2 ; 5 cents for a spool of thread that would sell at a better profit without the duty for 3 cents ; $1.10, on an average, for every dollar’s worth of iron aud steel we buy; $14 for a set of dishes that by right ought not to cost us more than $10; and correspondingly high prices for a thousand of the other necessities of our every-day life; and we get but 10 pounds of sugar for $1, where we should get 10. These are not inferences. They are facts familiar to many of us, and known to all. They are shown by market quotations and by actual purchases. A wagon-load of wheat worth $30 in Iowa is worth $45 in Liverpool ; but a suit of clothes worth $45 here is worth from $15 to $20 there. In other words, ten bushels of Iowa wheat will buy as good a suit of clothes in Liver- pool as forty-five bushels will buy in Iowa, not in all kinds of goods, but in many kinds. The folly of such legislation must be apparent at a glance. Its injustice is so broad and deep that no words of mine could add to its weight. But I want to say that I rejoice that I am one of the self-supporting payers of these outrageous taxes, and not one of the miserable mendicants who profit by them. As a matter of fact I may state that circumstances once compelled me, while traveling in the wilds of Iowa, to live for a week on corn-bread and buttermilk. As a matter of opinion allow me to say that I would prefer to live in that way the rest of my life rather than live on the proceeds of a u pro- tected” industry, and thus be a charge upon my industrious and self- supporting fellow-citizens. The man who feels that he would be ruined by the commercial freedom of his fellow -citizens has my profound sym- pathy. But, above all, I pity the workingman who thinks he is a public charge, and that he would be ruined if thrown upon his own resources, but who in fact supports himself and is forced by law to give away his hard earnings to his employer and other ^protected” paupers. If he would lift up his head and proudly say it, the workingman is not a pau- per. He is self supporting. According to Carroll D. Wright, chief of the bureau of statistics of Massachusetts, he has suffered a diminution of 10 per cent, in the purchasing power of his wages since 18G0. Pro- tection is a sacrifice, and not a gain to him. Like the farmer, he is taxed to support somebody else. Of course, that somebody else pretends that he is the author of all the farmer’s and the workingman’s prosperity. I never knew a cheat that didn’t pretend that he was giving two dollars for one. But I think the sublimest cheat on record is the man who tries to cheat God Almighty out of the credit of making this a good country to live in; and who pretends that what God has done in the way of piling up mountains of iron, silver, and gold, filling the bowels of the earth with salt, copper, coal, and petroleum, and covering its surface lIENltY J. PHILPOTT. ] FREE TRADE. 1109 for centuries with rich vegetable mould, and watering it with mighty lakes and rivers, and planting boundless forests — that all this would do the farmer and the workingman no good uuless they were taxed with a tax sucb as no other people ever submitted to. I think brass ought to be placed on the free list. We Western people have some peculiarities which may be of interest to your Commission. One is that we are very devout, and that we thank God, and not Morrill, nor his tariff, for all the good that comes to us. Another is that each county takes care of its own poor who are not able to take care of themselves, and instead of shutting them up in a factory it puts them oua u poor-farm.” These facts will account for the hard work and worry it has taken to get some testimony in favor of high tariff p resented at this meeting. They may also account for the fact that when a protectionist editor in this city builds railroads he goes to Wales for his rails. I am sure they help to account for that growth of tree-trade sentiment in the West which has called this Commission here, and which compelled four members of Cougress from this State to vote against its creation at the risk of offending their party. I have been requested by a number of leading business men of Des Moines, not members of the Free Trade League, to say that they are opposed to paying anybody to engage in a losing business. They want everybody in the United States to be occupied in business that pays, and they emphatically don’t want to be robbed in order to make some other man’s business pay. They would much rather that the man whose busiuess don’t pay without their gratuitous help would seek some better employment. If he can’t find it in this country let him go where he can. They are willing to let him down easy, if he has got so accustomed to alms that he can’t live without them, but they want him to begin in a very few years to run his business without their help, and if he can’t make it anything but a losing business let him stop when his own capi- tal is exhausted. Then if he can’t make his living here, and can’t get to a country where he can make his living, they are willing to contrib- ute freely to his support, provided a due account is rendered of the manner in which their contributions are expended, and provided he is content to live on the rations furnished to ordinary paupers. I have also a statement that was prepared ou behalf of the Iowa State Free Trade League by Mr. Charles E. Russell, of Davenport, who intended to be here, but has been kept away by sickness. This state- ment coutains some very interesting facts from flour manufacturers in Rock Island, Moline, and Davenport. The President. Read it. Mr. Philpott then read as follows : CHARLES E. RUSSELL’S STATEMENT. I would first observe that the census of 1880 compared with that of 1870 offers some very striking instances of the total absence of any be- neficent result to the people of Iowa from the protective tariff* that should not be passed by in silence; among these examples I note — First. Under a so-called protective duty of nearly 100 per cent., the woolen mills operated in Iowa have been diminished in number from eighty five in 1870 to forty in 1880. Second. In 1870 there were within the borders of Iowa fifty-five estab- lish inerts engaged in the manufacture of agricultural implements. If there be any industry in the world which ought to flourish in Iowa, it is the making of agricultural machinery. That industry has been “pro- 1110 TARIFF COMMISSION. [HBNltY J. PHILPQTT. tected” by a duty of 30 per cent. In 1880 the census shows that we still have in this State fifty-five implement makers, as iu 1870. But lookiug a little further we fiud eveu more instructive facts. In 1870 these implement factories paid $182,138 in wages to 552 hands, or an average of $328 a year to each employe. In 1880 they paid $235,380 to 653 hands, or an average of $236 to each employe. Third. In 1870 there were 545 establishments engaged in the manu- facture of lumber, employing 3,563 hands and paying $1,668,244 in wages, or an average of $467 to each employe. In 1880, under the operations of a so-called protective duty of $3 a thousand feet, the num- ber of establishments had sunk to 321, paying $905,962 to 5,747 em- ployes, or an average of $171 a year to each employe. Western manufacturers do not wish any protection on their products. Mr. B. D. Buford, president of the Buford Plow Company, Bock Island, 111., a well-known firm of twenty-six years’ standing, that last year manufactured a product valued at $1,009,000, says: There is not one article that we make or one interest of ours in the world that is in the least degree benefited by the tariff. On the contrary, almost everything that we buy is enhanced iu value by the present tariff, and of course our customers, in turn, have to pay more for what they buy of us. Almost every manufacturer iu the West labors under this disadvantage. We ship considerable amounts of our products abroad where they have to compete with foreign makers. IJere the disadvantage is even more severely felt. In New Zealand, where we are now shipping our goods, we come into direct competition with makers who are not hampered with these duties. We formerly did a remunerative business in Manitoba, but the Canadian Government has stopped that by placing a retaliating duty upon our products. Elsewhere we are com- pelled to enter the field and fight hampered by increased cost of materials, caused by the duties upon iron and steel. Every consumer has to ultimately pay the enhanced cost simply as a bonus for something called protection. The country would be better off without it. Mr. Lucius Wells, formerly manager for Deere & Co., Moline, 111., who made 97,000 plows in 1881, says that the cost of every implement turned out by this house is enhanced from 15 to 25 per cent, by the present tariff, with no compensating benefit. These two great agricultural works afford some valuable statistics from which to figure. Deere & Go . — This company occupies a total floor-room area of eight and three-eighths acres. Hands employed 800 Tons of steel used annually 1, 800 Tons bar and pig iron used annually 4, 300 Tons malleable iron used annually 450 F«et oak and ash lumber used annually 2,000,000 Tons Pennsylvania coal and coke used annually 2, 500 Tons grindstones used annually 1, 100 Tons emery used annually 30 Barrels oil varnish used annually 300 Plows made annually 97, 000 The Moline Plow Company uses every year — Tons wrought iron 2, 000 Tons pig iron 750 Tous steel 1,000 No foreign steel is used in any of these establishments. Mr. Piiilpott. We have not evolved these figures and comparisons out of our inner consciousness. There are a great many Iowa people like mysUf who were born here, and a great many have never been out- side of the United States; but there are others who have been. Many HENRY J. PHILPOTT. ] FREE TRADE 1111 of us have made purchases outside of the United States, and I want to say that the figures presented in that paper for the articles named are all very low. 1 have never yet seen a suit of outside clothing — and I have seen a great number of them and have always been particular to inquire the prices — which could be got in America for twice the price of the foreign article. I have at my house dress-goods which can be bought and are bought every day in Bradford, England, for 10 or 12 cents a yard, that I cannot get here in Des Moines for less than 25 or 30 cents. That is a cheap article of dress-goods, of course. I have bought Scotch lawns that can be bought every day at 10 cents a yard in Scotland, that cannot be bought in Des Moines for less than 15 cents a yard. I know, too, that the Des Moines Railroad Company bought Welsh rails laid down in New Orleans last year — and I give as my authority Mr. F. M. Hubbell, of the Des Moines and Northwestern Railroad — before the duty was paid, at $32.32 per ton, that would have cost in this country $48. They also bought 100 miles of rail at Springfield, 111., for which they paid $50 a ton. Steel rails, as a rule, cost from $25 to $28 a ton more in the United States than English rails do laid down in New York ex duty. On steel blooms the English price is £4 12 s. 6d. to £4 15s. The American prices are quoted at $37. The foreign price is about $23 for the English long ton, or about $20 for the American short ton, or about one cent a pound, while the American price of $37 is nearer two cents a pound. These market quotations come to us every week in the Iron Age and in the American Manufacturer, and we cannot ignore them. I have before me the r( port of Albert D. Shaw, American consul at Manchester, England, which has been published in the American Pro- tectionist, in which he makes a comparison between the wages paid here and abroad. And, by the way, the rates of wages paid in wool and cotton manufactories, according to the statistics of Carroll D. Wright, of Massachusetts, vary but little between Massachusetts and the various manufacturing cities of England. But lie gives the retail prices of x>ro visions, and among them he quotes sugar at 5 to 8 cents a pound, while our Des Moines merchants sell it to day without any profit at all — and they all claim at a real loss, and I think. probably the claim is correct — at 9 to 11 cents. The result of that is not only to make sugar cost more to us, but to cause the adulteration of our sugar with glucose and other pernicious substances which will injure the health of the people; so that we dare not even buy our children the candy we should like them to have. I believe that sugar is one of the prime necessities, one of the essentials. On the other hand, while these products that we Western people are compelled to buy because we can- not produce them, are so much higher here than they are where we sell five limes as much of our products as we do to all the unprotected and protected manufacturers of America, our products show an altogether different phase. I find that in Des Moines wheat is quoted at 70 to 80 cents a bushel; I did not have time to find out what the average figure is. Corn is quoted in Des Moines at 55 to 00 cents a bushel. I find the Liverpool quotations to be, the lowest figure for spring wheat 8s. 6d. per cental, about $ 1.22J per bushel, against 80 cents here — a difference of 50 per cent, and a little more. So that, as I stated, $30 worth of wheat here would bring $45 in Liverpool to-day. I note that corn quoted at 55 to 60 cents in Des Moines is quoted at 6s. lid. in Liverpool £>er cental, which would make it about $1 a bushel — a difference of more than 40 per cent. It comes very near being double in Liverpool what it is here, and I know that it is often more than that, when, as for the last few 1112 TARIFF COMMISSION. [HENRY J. PHII.POTT. years, we are compelled to sell our corn for 25 cents here, it is worth 75 there. And if we exchange it here for products of English manufac- ture on which the freight ought to be almost nothing, we are compelled to take one-third as much as we should get for it without the duty. So that a bushel of corn buys only one-ninth as much in Iowa as the same bushel buys in Liverpool in very many kinds of goods that we are com- pelled to use every day. I could verify many of those prices, but do not think it is necessary. It is certainly familiar enough to any one who knows anything at all about this question. By Commissioner Boteler : Question. It seems, from the general tenor of your remarks, that you believe it to be desirable that the people of the Western States should go to foreign countries for their supplies'? — Answer. Not at all. I do not think it is necessary for them at all. Their resources will enable them to make everything for themselves which it will not abundantly pay them to buy abroad rather than make. The man who is truly inde- pendent is he who has plenty to buy with and can buy cheaply where- ever he has to buy it. That is my idea of American independence. Q. How do you propose to bring that about — by having every farmer produce corn, wheat, and oats to send abroad, or to vary the indus- try ? — A. Whichever pays the American people the best. I am willing, gentlemen, to trust the judgment of the American people themselves in that matter. If it pays them better to plow, and sow, and reap, and mow, then I demand, as a private citizen, the right to do that for myself and everyone who thinks so. Q. Do you not think it better for the farmer to have the industries of the country varied so that those who are engaged in other occupa- tions may consume the class of articles which he produces'? — A. The very fact that it is better will cause it to be so in every community. If it pays the farmer better to till the soil at home, he will always do so. Q. Is it not better to have as many customers as possible near at hand for the farmer, those customers being engaged in occupations of a varied character? — A. Certainly. Q. Then do you not think it worth while to encourage manufactures in a farming community? — A. I certainly think it is beneficial to en- courage them, but not at the expense of the farmer or at the expense of anybody else. Encourage them all alike. 1 am for encouraging manu- factures in the United States. I would encourage them by taking off as soon as possible every possible duty from the raw materials and giving them the world for a market, and thus relieve our shipping from the injurious burdens that have always rested upon it, and, in fact, open our ports to all other peoples, and thus prevail upon them to open their ports to us. If we open our ports and allow our farmers to amass the wealth that they would under those circumstances, capital will soon be here in great abundance, to enable our manufacturers with cheap capital, abundant resources, even by paying high wages, to compete in the markets of the world. We export reapers, plows, and manufactures of various kinds. This system hinders our manufactures here in the West, and compels us to depend upon the manufactures of Pennsylvania and other States a thousand miles away. It does not matter to us whether our tribute goes to Pennsylvania or to Europe. So far as we are con- cerned, I will say it is better to have manufactures at home, but it does not concern us a particle to have them in Pennsylvania or Massachu- setts. HENRY J. RHILPOTT. ] FREE TRADE. 1113 Q. Would it not do much more good to have manufactures in Penn- sylvania and Massachusetts than in Manchester ? — A. I admit that it is a magnificent thing to have them in Pennsylvania. Q. Whatever benefits one portion of our country must necessarily benefit all the rest? — A. Not if one portion of the country is developed at the expense of the other portion. Q. If all the ports of the world were open, then perhaps there might be some inducement for us to be equally liberal; but, inasmuch as all other nations have protected their industries and closed their ports when it was to their advantage, it would be a piece of philauthropy which could hardly be expected of us to open our ports while theirs are closed. — A. Still not so much philanthropy as it is to take from Iowa to support Pennsylvania. By Commissioner Garland : Q. If I understood you, you used the expression that you were one who was willing to let down these industries. What did you mean by that? — A. I mean the protected industries, of which we have almost none in this State, but which are located, part of them, in Chicago. Q. You do not get my meaning, probably. I want to know what you mean by letting them down; do you mean by that, that they would be damaged by your policy? — A. No, sir; their prices would certainly come down. Q. You did not say “prices”; you said “protected indutries.” — A. I said, “ letting them down easy.” Q. I want to understand what you meant; whether you meant to say they had to come down under your policy? — A. Oh, no; we do not wish to stop a single factory in the United States, or a single protected industry. Q. Do you expect them to come down when your idea is adopted ? — A. We expect them to come to free-trade p rices ; that is all. Q. You expect prices to come down, but not industries? — A. That is it. I wish to go on record as saying that that is what I mean — that they come down in their prices; and also, many of them, I think, will come down in their profits. Q. You say in your printed statement that “they are able and willing further to bear the burden ot letting the protected industries down easy”; you do not say “ prices” there. — A. Very well; that is a figura- tive expression. They are now in an inflated condition. They sell their products at inflated prices, and the figurative expression of “ letting them down easy ” simply means removing duties gradually, so as not to injure anybody’s business unnecessarily, still bearing the burden and paying more than we feel we ought. Q. Why do you not adopt a policy, then, of letting them down at once? — A. We do not want to tear them down. If we cannot live in an atmosphere of commercial freedom, then I say, for myself, and 1 know I represent the sentiments of thousands of i>eople in Iowa, let them come down, and the quicker the better. Q. I understand you ; now you make yourself clear. — A. That is the meaning, exactly. By Commissioner Oliver : Q. Did you refer to iron rails at $48 delivered at New Orleans ? — A. I referred to iron rails. Q. Do you remember the price of steel rails before the present duty was put on?— A. It was $50.34, I think. 1114 TARIFF COMMISSION. [HENRY J. PHILrOTT. Q. I mean the price steel rails were selling at in this country in the year when the present tariff of $28 was put on ? — A. I do not remember the price. Q. It was $150 when the present duty was put on, when the Vander- bilts were buying for the New York Central. In Chicago, we saw the best works there in the world. Illinois there comes well up to Pennsyl- vania in quantity, and sells the steel rails at $45 a ton. Would you not acknowledge that as an instance where protection induces capital to build these works and induces the manufacturers to gradually bring the prices down to this low basis we all wish ? — A. I would not. Q. Protection did not do that?— A. Protection did not decrease the price of steel rails one penny. Q. Next to steel rails, what is the article most generally used in Iowa which the farmer pays for right out of his own pocket? Is it not fenc- ing?— A. Probably so, to-day. Q. Do you know the price of barbed wire for fencing to-day in Des Moines? — A. I do not know that I can give the price of barbed wire. (A Bystander. It is from 8 to 9 cents.) Q. Do you know the duty on steel rods, out of which this wire is made? — A. Forty-five cents, I think. Q. It is 30 per cent., or about $11 a ton. There is no fence-wire used in Iowa except that which is made from foreign rods. There is no arti- cle of iron or steel that is rated so low except only scrap and pig iron ; do you know that fact? — A. I think there is no other. Q. Therefore, under the present law, the lowest article that comes in — an article that the people of Iowa use the most of all — is the highest- in-iced article that they have to buy. Is not that so? — A. The duty, however, on wire is 2£ cents and 20 per cent. The farmer does not buy the rods. Q. The wire-drawers buy it? — A. The farmers do not buy it. They buy wire, and the duty on that is 2-J cents and 20 per cent., and it aver- aged about 76 per cent, in 1881, according to the Report on Commerce and Navigation. They do not import it because the duty is so high that it is prohibitory. Q. An increase in the quantity of wheat produced would make the price of wheat lower, would it not? — A. Somewhat lower. Q. Suppose all the 3,000,000 or 4,000,000 people now engaged in mills and factories were thrown on the market as laborers and producers of wheat and corn. — A. I deny that that lias any relevancy whatever, be- cause I deny that they would be converted into farmers. Q. Then 1 leave that. The average price of wages in Germany and England ranges lrom two to three shillings per day, and that, of course, is what makes cheap iron, because iron is nothing but labor. Then what would reduce our labor would raise theirs, would it not? — A. Not neces- sarily. Q. You thiuk, then, that we would be able to get cheap iron, and at the same time maintain the fair wages that the laborer is now getting throughout the country? — A. 1 do. I deny that protection has reduced the price of steel rails. I claim that certain inventions achieved by Henry Bessemer, an Englishman, and by Gilchrist and Thomas, of England, have cheapened the manufacture from $200 or $300 a ton in England to $24 there to-day. The necessary result of that has been that they are cheapened from $150 in America (or $200 or $300 at one time) to the rate they bear now, perhaps $45 or $47. But, note that it has reduced the price twice as much in England as it has in this country. HENKY J. PHI1.P0TT. J FREE TRADE. 1115 By Commissioner Ambler: Q. Do I understand you to speak of this reduction as resulting from the inventions of Bessemer and the others you speak of"? — A. Yes. Q. Is it a fact that there were any steel rails until Bessemer made his invention? Was there ever a steel rail laid until after that? — A. Not that I know of. The effect, though, is the same, because we had to use iron rails before. Q. That will not, then, account for the reduction? — A. Constant new inventions have done it. Q. What new invention has there been that has substantially re- duced the price of steel rails since the original invention of Bessemer? — A. I am not a steel-rail manufacturer. Q. I am not, either. I understand, though, that there have been some patents that have worked an improvement in the quality of the article, and perhaps there may be some — although I am not advised of that — that may have caused a reduction. My understanding, however, is that the Bessemer process of making steel is substantially now what it was when Bessemer’s patents were obtained, and 1 therefore am inclined to doubt the idea which you suggest, that the reduction has been occasioned on account of the patents. — A. My information is that the course of invention has been constant ever since the first Bessemer process was introduced. Q. There has been an improvement in quality, as I understand it. Do I understand you to have the idea that we would have the present production in steel rails, or iron in any form, in this country to-day if we had nothing in the way of tariff to induce it ? — A. I should not say very positively that we would have had as much, but I think we should have had a large proportion, sufficient i'or our necessities — quite as much as we ueeded. Q. That is to say, you mean that we have been using too much? — A. I do not mean to say that that would have been necessarily sufficient for all our home use. We do not need the manufacture so much as we do the iron itself. We would have had all the iron and all the furnaces that we really needed. Q. Let us see if that is so. We have had comparatively low tariffs in this country. The period between 1850 and 1880 has been mentioned as a time when the tariff was very low. Was there not a considerable increase in the iron production of the country during that ten years? — A. Nothing like it has been since, I freely admit. Q. I say, was there not a considerable increase? — A. My memory is that there was not any very great increase. Q. Then came the war and the high tariff and we had an enormous in- crease? — A. Certainly. Q. Is it not apparent from the statement I have made just now, and in which you agree, that there was a large increase in the productive capacity of this country in iron as a consequence of the high price of gold and the tariff of 1861? — A. I think very likely that those were all causes. Q. Do you know of any other cause? — A. The building of the Pa- cific Railroad, and the increased demand for iron in this country prob- ably had something to do with it. That was a great railroad. Q. The building of a great railroad like the Pacific Railroad, and con- sequent increased demand, would always have a tendency to increase the price. It is one of the rules, I think, that we all recognize as gov- erning the commerce of the world, that supply and demand have cer 1116 TARIFF COMMISSION. [HENRY J. PHILrOTT. tain relations to each other, and that, given a small production and a large demand, you always have high prices. You assent to that? — A. Certainly. Q. If in point of fact — and that seems to be the debatable question — we had not had in the United States a very large increase of produc- tion (which some people say is attributable to the tariff, and you would say is not attributable to it), would there have been, in your judgment, such a production as would have kept pace with the demand, or would there not/? — A. There would have been in the whole world together. Q. Where would it have been? — A. In England, Wales, Germany, and other countries. Q. Their capacity would reach far enough ? — A. To furnish what we lacked of it. Q. That is to say, England and Wales would have been our source of supply, instead of Pennsylvania? — x\. No; that is not my statement. 1 say if Pennsylvania had failed to supply us, England and Wales would have made up the deficit. Q. In case of war, supposing England, Wales, and Germany were sub- stantially our base of supplies instead of Pennsylvania as you suggest; in your judgment, as an economical man, would it be a good thing for ns, or for the world, to depend upon a single source of supply for an absolute necessity like that? — A. I think not. Q. I am not one of those people who regard the tariff as an un mixed blessing, by any means ; but is it not barely possible that, while there has been an increase of price to us on account of the tariff, there has been a larger supply resulting, and that, to some extent, the decrease in the price of steel rails, for instance, is attributable to that ? — A. I am inclined to thiuk not very strongly. Q. If, in point of fact, the effect of the tariff is simply to exaggerate prices, and there is no present or prospective benefit, I quite agree with you that we should not have any ; but 1 am inclined to think that there may be a factor that you do not fully take into consideration. — A. Even if admitted, it is so vague, so far in the future, so far away, compared with the hard-earned dollars that the Iowa people have had to pay for that luxury, that I do not like to indulge in that kind of speculation. Q. I will tell you, as a matter of information that has been given to us in relation to another product — and so far as I have heard both sides of the case, there was no difference upon that subject — that up to 18(53 or 1864 there was no crockery made in this country, except only what is known as the yellow or Rockingham ware, and then we commenced making it, and now we make about half the supply of the country. From 1850 to 1860 every person who has spoken on the subject agrees that the cost of crockery was higher in this country than it is to-day. — A. I do not uoubt it at all. Q. Everybody, at the same time, agrees to another proposition: that it is higher in England to day than it was then; and there is no ques- tion about that, because the English potters say so, and the importers say so, as I understand it. That question is free from any considera- tion about patents or anything of the kind. Now, can you account for the decrease in the cost in any other way than the way 1 have sug- gested? — A. We still buy large quantities of foreign pottery. Q. About one-half. — A. I would like to make a statement in connec- tion with this matter of comparison of prices. The question has been brought up here as to the relative prices of steel rails, pottery, and other articles during the low-tariff period of 1850 to 1860 and the present period. I would like to give some figures made by the editor of the HENRY J. PHILPOTT.] FREE TRADE. 1117 Baltimore Journal of Commerce and the Manufacturers’ Eecord; and I know that they are very nearly accurate, because I had looked them up previously. The figures are in regard to the prices of farm products. 1 find that for the period of 1846 to 1860 — which covers the low- tariff period — the average value of wheat realized on what was exported was $1.34 a bushel. If we take the low-tariff period of 1850 to 1860, the showing would be still higher. But taking the low-tariff period before that, it was 98 cents a bushel. By Commissioner Garland: Q. What market are you quoting? — A. It is the returns furnished by the public documents from the Bureau of Statistics, taken from custom- house returns. Q. The Liverpool market or the New York market?— A. I do not think it is stated. Q. The matter of transportation comes in for consideration. — A. I presume it is the New York market. By Commissioner Oliver : Q. Give us, at the same time, the prices here in Iowa. — A. We West- ern farmers claim that the railroads have done a great deal for us. They have given us constantly nearer and nearer New York prices for our products. I suppose I am quoting the New York prices; they are fur- nished by the custom-house. By Commissioner McMahon: Q. The custom-house furnishes two prices, the export and import. — A. It is the export prices. The amount exported is given and the value exported, and from that, by division, is deduced the average price for the year. The average price for those fifteen years was $1.34 a bushel. Now, by the same returns for the last seven years, during two or three of which gold was at a premium, the price was $1.18. By Commissioner Oliver: Q. Would that not be more than you pay, by the difference in trans- portation ? — A. I think probably it would, but I want to know now whether the tariff has reduced that. Q. 1 dare say that the freight on every bushel of wheat taken from Des Moines to New York is one-third to-day of what it was fifteen years ago. — A. I can see how that might give the Iowa farmer a better price. Q. That is not the question. You are making a comparison between the two periods, and we want it intelligently. — A. I am quoting the New York prices. Q. Then give us the Iowa prices. — A. I am not able to give the figures here in Iowa, but I can say this : that my recollection is, and I heard a gentleman here in Des Moines say it the other day, also, that corn was higher in Iowa from 1850 to 1860 than it has been for the last ten years. By Commissioner Ambler : Q. It is not troublesome to account for that. That was the period of the settlement of the State, when the settlers were using it. You had a direct home market for every bushel raised in that time. — A. I am per- fectly willing to admit that it was something else besides the tariff that cheapened steel rails, and something else that has done everything for this country. 1118 TARIFF COMMISSION. [HENRY J. PHILPOTT. By Commissioner Oliver : Q. You are well-posted in this matter and appear to have studied it up. What country in the world, next to the United' States, has been the most prosperous, in your judgment, during the past ten years? — A. I should unhesitatingly say England. Q. More so than France ? — A. 1 think so. Q. Have you paid any attention to the statistics of the payment of the French debt after France had gone through the war with Germany? — A. I have, but that is no indication. A tyrannical government can raise almost any amount of money. Q. Has England in the last ten years paid a dollar of her debt ? — A. I doubt it. Q. Has it not been steadily increasing its debt? — A. I do not doubt it. Q. Has not France been reducing her debt? — A. I do not doubt it. Q. England is absolutely free trade? — A. Not absolutely free trade, but England is free trade as we demand that this country shall be. Q. Are you acquainted with the fact that the French tariff is even higher than ours? — A. No, 1 do not know that the French tariff is higher. Q. Have you paid any attention to the condition of Canada for the last ten or fifteen years ? — A. Some little. Q. Are not wages very much lower in Canada than they are here? — A. I presume that they are as low. Q. Had not Canada what might be called free trade, only a nominal duty of 10 to 15 per cent, during the last ten years, up to last year ?— A. Last year or the year before. Q. Have they not now in Canada, without any opposition, come very nearly adopting the protective policy of the United States, by putting a duty of 25 to 45 per cent, on everything? — A. Nothing like the protect- ive policy of the United States. I call attention to that fact in my statement, that that has been done as a retaliatory measure. By Commissioner Garland : Q. Why do you say retaliatory ? — A. We put up a wall against them, and they retaliated. Q. There was a country rich in land and rich in all the resources that our northern country is rich in. — A. I deny that. Q. There is no doubt about it. We all know that they are rich in minerals, lumber, and land. It was stated to us in Saint Paul that they had lands extraordinary in quality and products. Would you recommend in this gradual abolition of duties a taking off of the duty of 20 cents a bushel on wheat ? — A. I would recommend taking off every duty at once from every agricultural product that is grown iu this part of the country, with the exception of wool, and I would that, except that it would create a disturbance. In 1890 I would take it off of every agricultural product, and I would have the farmers of Iowa solid with me. Q. We are told that there is a section 500 miles above Minnesota com- peting with us in wheat raising, and the farmers want 20 per cent, duty put on. — A. Our views are against that. Q. Then you would recommend that 20 cents a bushel on wheat should come off, thus allowing that wheat raised in Manitoba to compete with ours ? — A. Yes. During the last year of the low tariff, according to the statistics of the government, the immigration from Canada was about 30,000 to 31,000. During the first year of the high tariff it was 99,000, HENRY J, PHILPOTT.l FREE TRADE. 1119 and the next year it was also high, showing that the tariff did not stop immigration, and did not tend that way, but that, if it had any effect upon it whatever, it greatly increased it. By Commissioner Ambler : Q. Are you able to give us the year you speak of? — A. Probably it was the fiscal year of 1879 or 1880, or 1881, but I will not be certain as to the exact year. Q. As to this business of retaliation, they seem to have kept even with England and with us; were they retaliating on England? They had a general tariff, I understand, and it seems to me that it is hardly to be supposed that they are retaliating on all the world on account of our injuries to them. — A. Yet, that is just the policy that we are trying to adopt here — put up a tariff against all the world, to fight against England. That is the intent of the present tariff, and all arguments are predicated against England. Every protectionist paper in America raises the cry that we are in an irrepressible conflict with England. By the way, England takes live times as much of our products as all the States east of the Pennsylvania line, yet England is the country we are trying to fight by shooting at the entire world. If we can do that, Can- ada can certainly retaliate against us. Q. I beg pardon; this is your fight, not mine. — A. I am not fighting it, but I wish to say that the price of corn for fifteen years, ending in 1855, was 74 cents; the price for the fifteen years covered by frve trade .was 72 cents. The export price for the last seven years was 56 cents. Commissioner Oliver. Knowing the difference in freights, it is pos- itively unfair to make that statement. We all know that the rates of transportation have been reduced from one-third to one-fourth since 1860. Bailroads are compelled to haul more cheaply. By Commissioner Boteler : Q. Do you think, by throwing down the barrier of 20 cents a bushel on wheat, that the Iowa farmer would be benefited and get better pri- ces? — A. It would make about as much difference to him as when two clouds meet in the sky two thousand feet above him, because the Amer- ican farmers have to sell this year 250,000,000 bushels of wheat abroad. Q. Are not the farmers selling a great deal of wheat to these big mil- lers, the Washburns and others, in Minneapolis? — A. On the contrary, we buy Miuneapolis flour here. Q. Do they not sell it to them ? — A. I think not in this part of Iowa. In the northern part of Iowa undoubtedly they do. Q. If the barrier was put down and the millers there could get their wheat more cheaply, as they certainly could do, because prices are lower in Canada than here, would that benefit the farmers of any part of Iowa? — A. As I said before, 1 do not think the reduction of that par- ticular duty would benefit the farmers of Iowa a particle. It would only be giving a small sop to Cerberus. I beg the Commission to re- member that it has been proved here at this meeting that tariffs reduce the prices of articles instead of increasing them. I infer from that, that that tariff of 20 per cent, is what makes wheat so cheap here in Iowa. If that be a proper inference, as it must be from the argument, I should say that the removal By Commissioner Ambler: Q. Do I understand you to say that that would be a proper inference from the argument? — A. Most certainly. 1120 TARIFF COMMISSION. [HEXRY J. PH1LPOTT. Q. Which argument was it? — A. The argument made in the case of pottery, and also in the case of steel rails. Q. That is to say, you apply an argument made with reference to an industry just starting to an industry such as the raising of wheat, in which there is a very large capital already invested"? — A. And yet each new wheat-field is an industry just started. Commissioner Ambler. Of course it is. The Witness. I have seen it stated, and do not doubt it, that we have never produced more than wheat enough to seed our good wheat lands for one year. The wheat industry in this country is yet in its infancy. Q. Where has it grown to years of discretion"? — A. I should say in Germany it had, and in England; but this country being such a large country, its infants are pretty good sized. By Commissioner Underwood: A. T do not want you to understand, from any question I ask, that I am making an argument against any theory you propose. I merely want to get at precisely what your views are. You say in your direct state- ment, U I have to say further that as private citizens and tax-payers the members of this league are entirely willing and abundantly able to bear their full share in the support of the government.” How do you propose, when free trade is reached, to raise the revenue necessary to defray the expenses of the government economically administered ? — A. By a tax on liquors about equal to the present tax. Q. You further recommend “that the taxes on domestic and foreign liquors and tobacco remain, together with other existing internal rev- enue taxes, in order to make the necessity for tariff taxes as small as possible.” Do you think the present internal revenue raised from those articles would be sufficient to pay the expenses of the government eco- nomically administered, and pay off* the public debt during the time re- quired by the exigencies of the country "? — A. I am inclined to think they would hardly do it. Q. Now, tell me how you would get the balance? — A. I would levy a tax, of course, upon foreign liquors and tobacco to countervail the ex- cise tax. Q. That is already levied. Do you think the tax is sufficient ? — A. I rather doubt it. Q. Do you believe, and do you advocate the levying of a tax upon a particular industry in the country that is not general throughout the United States? For instance, I illustrate with tobacco. Tobacco is not raised in all the United States. Do you think it is fair to make a tax upon the products of a few particular States and allow the products of other States to be free from taxation ? — A. We are willing to balance that with our alcohol. Q. Do you think that the manufacture of alcohol is advantageous to this country ? — A. I do not see how that has any relevancy. Q. I say that, because if there should arise in this country a public sentiment that would prohibit the manufacture of alcohol we would have nothing upon which the taxes we expect to get could be raised. — A. Then we would have to look elsewhere. Q. That is what I am coming to. Do you propose to levy a tax of so much a bushel on wheat ? — A. No, sir. Q. Do you propose to levy a tax upon corn ? — A. No, sir. Q. Do you propose to levy it upon cotton? — A. No, sir. Q. What do you propose to put it on — the windows of the houses ? — A. It is on there now. HKN'UY J. PIIILPOTT. J FREE TRADE. 1121 Q. Do you propose to tax the light of heaven ? — A. That is already taxed. Q. How is that taxed? — A. There is an average tax of about 50 per cent, on window glass. Q. We can get light without window glass. — A. We do not like to in this part of the country. The man who raises the product is not the man who bears the taxes ; it is the man who consumes who pays tbe taxes. Q. What product of the State of Iowa do you consume upon which a tax is levied ? — A. Wool is one small item. Q. The Government of the United States only taxes foreign wool, and not Iowa wool. — A. Very well ; but then, according to the argu- ments that have been produced by members of the Commission — Q. I deny that I am making any argument; I am after information, and that is all. Do you propose to dispense with the revenue by duties on imports l — A. As far as possible. Q. Your demands are that the tariff should be gradually reduced until we reach free trade, and then, you say, you are willing to tax some of the luxuries. Do you regard tea and coffee as luxuries ? — A. No. Q. Do you propose to tax them ? — A. That is a practical question for Congress to decide. Q. I want to find out what the Free Trade League is for? — A. The Free Trade League has never framed a complete tariff. Q. Congress has never done so yet. — A. I suppose your Commission will. Q. I doubt that. You do not expect us in five months to do what Congress has failed to do for one hundred years. You Avould give 11 s credit for more talents than I think any nine men in the United States have, if you expect us to do that. — A. And you expect the Iowa State Free Trade League to do that very thing. Q. Oh, no ; I want to know how you propose to raise money ? — A. As I said, the Free Trade League has never framed a tariff, and for that reason I cannot be certain how far I represent the sentiments of that Free Trade League in stating whether I believe such and such a duty should be placed upon articles. But I will say for myself, personally, that there are a number of articles on the free list which I think might yield some revenue, and I think tea and coffee are among the number ,* but I would have the duties on tea and coffee quite low, for the reason that they are used probably in larger quantities by the poorer classes of people than by the wealthy. But I would put a low duty on some- thing that everybody uses, because I do not believe there is a workman in the United States that would not want to contribute his share of the taxes like a man to support the government. Q. You have not formulated in your own mind the ways and means to raise the revenue for the government, and you do not know that the Free Trade League has done so up to this time ? I squarely and fairly want it if you have done so. — A. I have stated for the Free Trade League that we are willing to be taxed on a few articles of luxury. Q. But you do not state what they are. What is the definition of luxury? — A. There are some of the finer kinds of silks, for instance, some wines and brandies that might bear a high duty ; diamonds, gems, and jewels ; and there are fancy articles that come to this State to-day that might be taxed 50 per cent. Q. The duty is now so high upon diamonds that three-fourths of those that come to the country are smuggled in, and if you make it any higher it will increase the amount of smuggling. — A. The duty on diamonds is H. Mis. G 71 1122 TARIFF COMMISSION. [henry j. philpott. 10 per cent., and if that encourages smuggling I should like to know what 30 per cent, on some kinds of cloth will do. Q. You are proposing to tax tobacco because you think people ought not to chew, I presume? — A. No; that is not the reason, specially. Q. You know that tobacco is not raised in every State in this Union? — A. I know that it is consumed in every State, and that the consumer invariably pays the taxes. Q. That is so sometimes, but not always. Now, if you have got a well-defined way of raising revenue, in your own mind, which is better than by raising it by duties upon imports, it is fair to let us have it. — A. If this government were economically administered as it should be, $80,000,000, or, at the outside, $100,000,000 is quite sufficient for that pur- pose, and that could be raised by moderate taxation. After reaching what I should call the free-trade period, I should be perfectly willing to pay taxes on tea and coffee, not too high, and on the finer kinds of silks, fine wines, brandies, particularly such as we import, and to be taxed on fancy articles of various kinds. If the people had free trade and were allowed to have the prosperity that free trade would give them, the taxation we could put upon articles of consumption would not be at all burdensome, and yet, at the same time, we could raise the $80,000,000 or $100,000,000 necessary to run the government. You understand my position now. Q. I do. What amount of imports do you think would come into this country under your schedule necessary to raise the $100,000,000 ?— A. I should think by the year 1890, if we reach free trade at that time, we could easily have $1,500,000,000 of imports. Q. What amount of exports ? — A. About the same ; it would nearly always balance. Q. Of what would it be composed ? — A . We would send many things of iron to Brazil, such as plows and agricultural machinery, as we do now to Australia. We would send alcohol and many articles of that kind to Europe; and cotton goods to China and Japan; and we would con- quer that East India and China trade. Q. Have we any ships with which to carry it ? — A. We would g'et the articles transported some way; we would do just as we have to do un- der the present system — we would wait for Johnny Bull. Q. Do you know why we have no trade with Brazil to-day? — A. On account of the tariff*. Q. No, sir; it is the navigation and shipping laws and the fact that we have no Navy and no marine. — A. I am willing to admit that to a certain extent; but if we have free trade all those obstacles will be re- moved, and if this great people of 50,000,000, with their unbounded re- sources, which have been saved for them by their Creator for at least 0.000 years, need ships in order to conquer the commerce of the world, they will get them. I have that much faith in them. To say that the 50,000,000 of American people, of whom I am one and one of the poor- est (that is, one of the weakest), are not able to take care of themselves in a free-for-all race, is a thing that I utterly deny. Q. What do you think would become of this country if our imports exceeded our exports in twenty years? — A. I think it would move grandly on. Q. You think a farmer who buys more than he sells will get rich ? — A. I think that a farmer who takes in more than he puts out will get rich. Our income is our export, so far as our foreign trade is concerned. HENRY J. PHILPOTT.] FREE TRADE. 1123 Mr. Philpott afterwards further stated to the Commission as fol- lows : I wish to make a statement in regard to the amount of wheat exported from this country. I would like to have it go on the records of this Commission as it actually is. It can be found in the reports of the Bu- reau of Statistics. I will refer you to the place where you can find it, and also give you the facts as they are. In the year 1879 there were produced in the United States about 498,000,000 bushels of wheat. According to the report of the Bureau of Statistics for 1880, and according to the difierent reports, from 36 to 40 per cent, of that was exported. That is one of our agricultural pro- ducts in which we are particularly interested. I have seen it stated that it was 40 per cent., and again I have seen it stated at 36 ; and I am not sure but I have seen it stated as low as 34 per cent. The wheat crop produced in 1879 will appear in the record of exports for 1880. By Commissioner Oliver : Question. Was not 1879 an exceptional year? — Answer. The propor- tion was rather large that year. Q. Do you think last year that we exported one-half of the amount we exported in 1880 ? — A. No ; I think not ; but I would also say that last year was exceptionally low, while the preceding year was excep- tionally high. For the present year I have seen a number of estimates. The Agricultural Department, I think, estimates the present crop at .five hundred millions ; and I have seem estimates all the way from that up to six hundred millions ; but I am willing to put it at five hundred millions. By Commissioner Boteler: Q. Suppose you mention what was exported before 1879, to make the statement complete? — A. In the year 1850 about one-third of one per cent, of the crop, if I mistake not, was exported. In 1860, something over two per cent, of the crop was exported. In 1870, it seems to me, that there was 14 per cent. ; but I will not be positive of that. In 1880 it is variously estimated, as I said, but not lower than 34 per cent. So that the proportion of our crop for which we depend upon the foreign market has maintained a constant and very rapid growth for the last thirty years or more. By Commissioner Oliver : Q. Then, when there was what we might call free trade, about 1850, we only exported about 2 per cent, of the wheat crop, and when we had high protection in 1880 we were able to export 34 per cent, of our wheat ? — A. If you wish to put it in that way, that we did do ; and that was partly because we were compelled to, and partly because we produced so much more of it. However, the export was increasing, and it in- creased as rapidly, perhaps, under free trade as it did under protection. Q. Not from the statement you made of 1850 to 1860. — A. Allow me to make the statement I have here, taken from the Manufacturers 7 Becord, of Baltimore, which that paper got from the government reports. In the five years ending 1845, the amount of wheat exported was about $3,000,000, and the flour $34,000,000, in round numbers. In the next five years, ending 1850, $12,801,000 worth, or something over four times as much wheat, and $82,000,000 worth of grain, and twice as much flour exported. I would also state that for the five-year period, ending with the end of the high tariff, it had to sell at 98 cents, although we only 1124 TARIFF COMMISSION. [HENRY j. philpott. exported one-fourth as much; whereas during the five-year period in which we had low tariff we sold four times as much wheat and got $1.25 for it. The same is true of corn. Under our low tariff we exported 3,474,109 bushels in the five years ending 1845, and in the five years ending 1850 (the first five years of low tariff) we exported over 42,000,000 bushels, or nearly fourteen times as much. This question has not been discussed fairly. It is not fair to take the present year, what we call a u boom,” and compare it with any single year in the past. The only fair way is to take a whole, long series of years and base the average upon that. Commissioner Oliver. We take your own statement. Don’t say we are not taking it fairly. The Witness. I beg pardon of the Commission. The Commission is not unfair, but the matter that has been put before the Commission in that way has been stated unfairly. So far as that is concerned, I am perfectly willing to admit and have admitted to the Commission that 1879 was an exceptional year. What I want is to get this matter be- fore this Commission just exactly as it is; I would not misrepresent anything. In 1882 we exported 43,148,000 bushels, just a little less than we did in the five years ending 1845, showing that our export of corn is con- stantly increasing. And in 1880 we exported 98,000,000 bushels of corn, twice as much as we did in the other five years. In 1881, 91,000,000 bushels. In the five years ending 1870 we only exported 47,000,000 bushels. So that it shows that pur dependence on foreign markets for our products is constantly increasing, in spite of all that can be done by building up our protected manufactures. But what I wanted to call your attention to particularly, was that we have produced this year and year before last about 500,000,000 bushels of wheat. We retained for home consumption, according to the Bureau of Statistics (I think the report is given for September, 1881; it is one of the quarterly reports for that year sometime), a little less than 300,000,000 bushels. It is estimated in that article from the Baltimore Manufacturers’ Record that we will consume about 300,000,000 bushels this year at home, and we will be obliged then to sell 200,000,000 abroad. Now, remember that of that 300,000,000 bushels we consume at home, 50,000,000 bushels will be required for seed to sow 37,000,000 acres. Every farmer here knows that it takes 50 bushels of wheat to sow 37 acres, taking tall wheat, and that is rather a low estimate. Mr. Guinnell. That is rather low. They put on about two bushels to the acre now. Mr. Philpott. I want to make this statement fair, even at the risk of making it against myself. We will allow 50,000,000 bushels for seed, then that leaves 250,000,000 bushels to be eaten. Now, the farmers of this country themselves constitute more than half the population of the United States, and it is very natural to infer that they consume at least one half of the wheat. That leaves 125,000,000 bushels for the farmers to eat. The manufacturing, mechanical, and mining population of the country is about one-fifth of it; one-fifth of 250,000,000 bushels which is left to be eaten is 50,000,000 bushels. So that the manufacturing, me- chanical, and mining population of the whole United States consume less of our wheat than we are compelled to sow for seed, and only one fourth part as much as we are compelled to find a market for abroad. Commissioner Oliver. Please do not understand that because you are not interrupted we are assenting to what you say. It would pro- long the session too much if I were to interrupt you. HENRY J. PHILPOTT.] FREE TRADE. 1125 The Witness. I would refer you to the census of 1880, when it is out. The part exported must be about 200,000,000 bushels, or about four times as much as is consumed by the entire mining, mechanical, and manufacturing population. Of course the mechanical part of the popu- lation is not at all protected. I lived in this country in what are called free-trade times, and I never knew a farmer who got his horse shod in England, or who had his house built there, or had it plastered or glazed there, or had his cellar dug there, or his cistern walled, or his well. I therefore consider that those classes of occupations cannot possibly be protected by the tariff; that we would still need the wells without the tariff, still be compelled to get them dug, as well as our cisterns and cellars, and that we would not get it done abroad. I make that as a fair statement. I shall take Commissioner Oliver’s word for it that no one will interrupt me now if he objects to it, but I wish it to go on the record that I make this statement. I think it is not fair to assume a case that we are going to lose all our home market. If every manufact- uring establishment in the United States, every blacksmith shop and everything of that kind were shut up, and that many people would just simply stop buying our wheat, we could only lose a market for 50,000,000 bushels, and we lost fifty million bushels and more by a short crop last year. Our crop last year lacked over 100,000,000 bushels of being as large as the crop of the year before, and that would be a bigger loss to us than the entire market of every manufacturing, mechanical, and mining man in the country. I think I have made that statement so that it will go on record as I conceive it actually to be. By Commissioner Ambler : Q. Can you tell me what the aggregate of the agricultural products in the United States is? — A. The agricultural products last year were about $3,000,000,000. Q. Now, will you tell me, outside of wheat, corn, and pork, what the amount of exports may be % — A. About two-thirds of the cotton was exported. Q. You include that in your $3,000,000,000 ? — A. Yes, sir. Commissioner Ambler. The estimate is too low. The Witness. I have the agricultural report of 1880, giving the census report on agriculture, and it only foots up $2,000,000,000. Q. I see by this report you have handed me that there was exported nearly 92,000,000 bushels of Indian corn in 1881. What proportion does that bear to the corn crop of the country? — A. About 0 per cent. Q. Of oats there were 402,000 bushels exported ; what proportion does that bear? — A. That would only be quite a small proportion. 1 would like to state that the total agricultural product footed up in the census of 1870 $2,440,000,000 worth. That was on a paper basis, when gold was at a premium, so those were inflated prices. In 1880 the prices were quite low. The winter before that there was more corn burned for fuel in this State than was ever burned before, and it was very low in price; it was hardly worth gathering in many parts of the State. A great deal of it was left out in the field and wasted, partly because it was a bad time to gather it. But I have figured up the product of beef and pork in the year 1880, and added it to the statement of the Agri- cultural Department. I cannot possibly find more than $3,000,000,000 worth. And, remembering that there were inflated values in 1870, I should say that was about right. During that year we exported 1126 TARIFF COMMISSION. [HEXEY j. philpott. $737,000,000 worth of agricultural products, as shown by the custom- house returns. That would be almost one-fourth, and 1 think it is safe to say that instead of having a home market — that home market we make ourselves when we eat what we produce — instead of having a home market of 90 per cent, and exporting 10 per cent., it would be safer to say that we export 25 per cent, and have a home market of 75 per cent. The farmers consume half of the rest and the manufacturers 15 per cent, of the whole. Commissioner Underwood. I want it to be known that about $300,000,000 of the export was cotton. S J. LOUGHRAN.] IRON AND STEEL. 1127 S. J. LOUGHRAN. Des Moines, Iowa, September 15, 1882. Mr. S. J. Loughran, editor and proprietor of the State Journal, and by occupation an engine-maker and founder, made the following state- ment : Having been appointed to prepare a statement of the views and in- terests of the iron and steel workers of this city upon the subjects of your investigation, I have conferred with the proprietors of all the boiler- shops and foundries, in whose name the following is submitted : There is not much imported iron or steel used in this city. Four of the five foundries use a little Scotch pig, in all not more than six car- loads a year. Two or three kinds of “America- Scotch ” are used in small quantities. Strong foundry iron is obtaiued from Lake Superior, Ohio, Tennessee, and Missouri. American boiler plate and American flues only are used by our boiler- makers. They say the English plate and flue is inferior in quality, and for that reason they will not use it. They complain that American plate is not always equal to the stamp, and they desire that Congress make a more stringent law for the safety of boiler users. Only American bar iron is used here. Common English is much in- ferior to common American iron, and we find that the best is the cheapest. English tool steel is used by some. W ithin two or three years we have been getting American tool steel that is equal to the English, which is fast displacing the imported article. American machinery steel is taking the place of iron in the construc- tion of machinery. The quality is excellent, and the competition among American manufacturers has reduced the price as low as that of supe- rior iron. The price of tool steel has also been reduced by American manufacturers. American steel, equal to English, is now sold 15 per cent, lower than the English. We appreciate the fact that a protective tariff has improved the quality and reduced the cost of iron and steel in all their forms. We also be- lieve that a continuation and perpetuation of the protective policy will encourage capital and skill to greater developments, resulting in more improved quality and reduction ot cost. The cost of iron and steel can be reduced permanently only by American competition and free trade at home — not with foreign nations. By free trade at home we mean the absence of all obstructing combinations of capital or labor, and direct, cheap transportation. Admitting the necessity of a reduction of the tariff on some articles, we dread the result of any reduction that would close mines or mills j for although the effects would be first felt in Eastern States, the disas- trous wave would reach every hearth and home in Iowa, as after the panic of ’73. A diminished market for the produce of Iowa farms would deprive Iowa farmers of that surplus cash with which they built houses, barns, and fences, and purchased implements, machinery, and more acres. A tidal wave of tramps would again sweep over our fair land, impover- ished for want of employment and demoralized by poverty. The disastrous results of depression following the panic are instructive. Some manufacturers were forced by the competition to reduce the grade of their iron. Boiler-makers had difficulty in obtaining from the man- 1128 TARIFF COMMISSION. [S. J. LOUGHRAN. nfacturers, previously and since reliable, such iron as they could safely warrant to the purchasers. Thus were the lives and property of some jeopardized by a forced economy. Then, aud always, the rule holds good, that poor pay secures poor service. Some of our farmers have had experience in this line, which should not be forgotten. About ten years ago there was an organization of farmers known as the Grange. At that time agricultural implements and machinery were high. The farmers vowed utter extermination to the manufacturers and their agents ; not considering that it was a vicious credit system which made the goods cost so much. They appointed purchasers and agencies, and, of course, bought cheap machinery and sold it cheap to the Grangers. Some of their reapers and mowers lasted one year ; some two or three. When some parts failed it was found impossible to obtain repairs ; the cheap manufacturers could not be found, or the agents had become tired of their agencies. It was a dear lesson to many, aud one that all should heed. Should Congress heed the clamor of a few one-idea and inexperienced 211 en to open the ports for free admission to such machinery and imple- ments as heartless or ignorant importers may choose to oixler, the re- sult will be much more disastrous to the farmers of Iowa. European methods and implements are utterly unsuited to the wants of this country, and their mechanics are too self-satisfied to learn from Ameri- cans. I do not underrate the farmers of the United Kingdom. A Scotchman will grow more wheat on one acre of his cold and storm- beaten isle than an American will grow on three acres of Iowa’s choicest soil ; but he does it at an expense of animal power — strong men and Clydesdale horses — much greater than Iowa farmers can afford. Should England send us a plow possessing merits, some cute Yankee will make another so much superior that farmers cannot afford to use the imported implement if they should get it for nothing. Tim demand and uses for iron and steel increase much faster than population or occupied territory. Unless the supply keeps pace with the demand, the prices will be unnaturally high. Unless capitalists have assurance that money invested in iron or steel works is as safe as money invested in land they will not embark in the iron or steel busi- ness. Therefore it would be wisdom itself to remove all apprehensions by the adoption of a permanent policy of protection. Make iron-mills stock as safe as government bonds, and it will sell as fast as 4 per cents. Then we will have cheap iron and plenty of it. By the President : Question. You have a practical knowledge of the statements you make in regard to the qualities of American machinery and American iron? — Answer. Yes, sir. J. B. GRINNELL.] FLAX, WOOL, ETC. 1129 J. B. GRINNELL. Des Moines, Iowa, September 15, 1882. Hon. J. B. Grinnell, of Grinnell, Iowa, stated as follows : Mr. President and Gentlemen of the Commission: As a citizen of the State, in the absence of any formal welcome by the authorities of this the capital city of the State, I will say, for one, that I am very happy to see the honorable Commission here, representing all por- tions of the United States and so many industries. I have attended three conventions that were called for the purpose of inaugurating what we call the Tariff Commission. I was favorable to that Commis- sion. I made three long journeys for promoting the organization of that Commission. I made a promise to a certain gentleman connected with the flax interest of the country and the hind interest, that when the Commission came to this city I would appear before them. I made a further promise to certain farmers, numbering twenty or thirty in one place and fifteen or twenty in another, that I would present the matter of flax-raising and the embarrassments under which it is now carried on in this State, and ask relief before this Commission. I have no prepared speech. The notes I have I have made since I came into the room, expecting that the Board of Trade and others here would occupy the whole of the time and that I would have until to-morrow to prepare what I purpose to say. I say, gentlemen, preliminarily to the particular remarks I wish to make, that I am a farmer. It is true, I have had varied occupations within the last twenty-eight years, more from necessity than from inclination. But my interests are solely with the agriculturists, as land owner, settler in this State, and farmer, taking up a large tract of land, having con- tinued on it lor the last twenty -eight years, and having operated farms in different counties in the various branches of agriculture. I am very glad you have just been listening to a free-trader. I am a protectionist. I am a tariff man from association, from conviction, from principle, and from interest. I dissent, however, entirely from all of his allegations in regard to the opinions of the farmers. I have a wide ac- quaintance with farmers all over the State, and I do not know of an intelligent, progressive farmer, that uses the best tools, that has the best barns, that raises horses whose necks “ are clothed with thunder,” and who has the best opportunities for gaining information, who is a free-trader; and I claim an extensive acquaintance. I will say frankly, without disrespect to the gentleman who has occupied your time, that I do not know of a person who entertains his opinion. 1 understand free-trade leagues are formed. That is all very well. You can go into a town anywhere and can hear the argument made that a suit of clothes can be got for $12 abroad that cost $25 here. But you go out among those who believe in reciprocity, and who believe that we cannot keep and sell both, that we cannot both have the highest market and the cheapest goods at the same time, and that we have a government to support, and they Like no stock, as far as I know, in that assertion. I will say furthermore, that you come to a State of educa- tion. Our schools are as free as the air and water. Our colleges are well patronized, and I do not know of a president or professor of any 1130 TARIFF COMMISSION. [J. B. GRIXXELL. college in the State of Iowa — and there are some twelve or fifteen col- leges here — that is a free-trader. I do not utter this to impair in any degree the force of the gentleman’s statement. I only wish to give it as a matter of public sentiment. It is my conviction that there is com- paratively no free- trade sentiment in the State of Iowa. And, gentlemeu, we are now 1,700,000 people in this State, which is but thirty-eight years of age, and but little more than one-third of our acres are under cultivation. We are passing the great rudimentary period. We are just having time to send our boys to college and our girls to seminaries. We have a railroad system. We are starting our manufactures. This is a city of manufactures of about 30,000 inhabi- tants, and what would it be but for the fact that 5,000 people in the city of Des Moines are connected with manufactures ? I tell you there is no industrious people, there is no enterprising, ambitious city in the State of Iowa that does not encourage these manufactures. That is the spirit that animates all the towns. When capital comes here to build manufactories it is told: You shall come free of taxation; you shall have this water-power free; you shall have this real estate free. The fact is there is a constant strife, from Keokuk, the watchful fox in the southeastern corner of the State, to the northwest corner, and so on throughout the State, as to who shall be ahead in manufactures. I can appeal to every gentleman here, to Senator Wright, who has been all over the State as a judge, and who knows men from every part, to bear me out in the assertion that it is the ambition of the people of the State to become a manufacturing State. Look at our farm products. The oats raised in the State to-day are selling in this market at 30 to 35 cents a bushel. Corn is selling at 00 cents a bushel. Cattle, such as I raise, well fed, are worth now from $4 to $7 per hundred, live weight, on foot. Now, of course, these facts show that the gentleman to whom you have listened so patiently, and who is a free-trader, is mistaken entirely in the facts in regard to the farmers. He conceals — he has a right to for the sake of his argument — the fact which I present before you, that there are 1,700,000 people in this State, which is rapidly increasing in population and in every industry of which I can speak, where there are prosperous times, high prices, and crops reasonably good. The doctrine of the people of this State is the same doctrine that has been proclaimed by Jackson, by Greeley, by Clay, by Republicans and Whigs, and by all the statesmen that I have read of or heard of from the lOundation of this government to the present time. That is my inividual opinion, which I think it proper to state, and is not given without some means of knowledge. It is a biased opinion, I grant, because that is a sentiment which has grown with my growth, and it has taken possession of me and grown from year to year more firmly, that the only way in which the State of Iowa can become a man- ufacturing State is that we shall have some of the benefits of a tariff. Though not agreeing in politics with Senator Voorliees, of Indiana, I am in entire accord with an utterance of his in a conversation with me not long since, when he said that “This government must be main- tained ; we have the pensioners to pa , ; we have the general expenses of tlie government, and they cannot be raised by direct taxation alone. No politician in Indiana or out of it could live twenty-four hours advo- cating a direct taxation, and 1 am for Indiana, with God’s help, having her share, and therefore I am for a tariff.” I agree distinctly with that eminent gentleman in that respect, and that is the position in the State of Iowa to-day, of all parties. I was told by a soldier, a lame man, leaning on his cane, who had slept J. B. GRINJfELL.] FLAX, WOOL, ETC. 1131 in prison in the South, and is now drawing a pension of only $8 per month, “With free trade, where would be the pensioners? I do not believe that the pensioners of the country would be paid on a free-trade basis’’; and I was in hopes the learned gentleman who has been advocating free trade to you this afternoon would refer to that matter and answer how we could be expected to meet the hundreds of millions required for the pension pay-roll. I say that 1 am for a tarilf to carry the pension- ers. I am for a tariff to support the government. I am for a tariff that the State of Iowa may get the most she can out of it. 1 will state another fact. In the history of manufactures, especially in new countries, they gravitate towards cheap food, coal measures, and water power. We have all three of those ingredients. We have the best corn State in the Union, and have raised more corn thau we shall need. We have corn to supply the wants of five millions of people. That is waiting to be consumed, to be used in the still. We have water power. The Des Moines River, which is dammed by the government, lias water power enough to turn all the spindles that can be brought into our State. The largest streams have abundance of water power. Now, as a citizen of the State, I desire that manufactures may grav- itate to us. I desire that this Commission, if it represents the citizens of Iowa — I do not mean the editors ; I deny that a man who sits in his office can represent the masses of the people with their flocks and their herds — I desire that this Commission shall say that the people of Iowa want a tariff, and that that State shall receive its just proportion and no more ; that this tariff shall be so framed that betore some of as shall sleep in the grave we shall know that Iowa is as celebrated for being a manufacturing State as it is now tor its remarkable agricultural pro- ductions. And that I believe will be in the near future. That which we have felt the want of we have attained in a remarka- ble degree; that is, cheap money. I am happy to announce that any man with good property and good security cau borrow money to an in- definite amount in this State at from (3 to 8 per cent., whereas in years previous it was from 8 to 12 per cent. Of course that goes to show the marked prosperity of the people. Money is the most sensitive of all commodities, and this goes to show how good is our security. With this cheap money our manufactures are coming up. This capital city will, be the center of the manufacturing industries of the State. Money is concentrating here. Here is an abundance of coal, here is an abun- dance of water power, here is a great agricultural basin and plenty of timber, and all that goes to make up a rich and prosperous place. It is enough that I should say — not- by way of repetition, but as a mat- ter of fact — that the agriculturists of this State are prosperous. They are happy, and when any gentleman, I care not what his profession, seeks to enforce upon me the conviction that I am burdened by low prices for my products and by high prices for that which is necessary for me and my family, I beg leave to call his attention to this fact, that now clothing and the necessaries of life in a family are indigenous. They may be produced in our own couutry, and cost 50 per cent, less now than they did 12 to 15 years ago. I make that declaration, and opposed to that 1 make this statement: that the products of this State to-day — wheat, oats, corn, barley, live animals — are now 60 per cent, above what they were in the time of low tariff, 50 per cent, in our favor as purchasers, and 60 per cent, in our favor as sellers. I make that declaration from a careful comparison of facts. I am quoting Iowa prices. I do not quote New York prices or Liver- pool prices — only I agree with the Commissioner when he pushed my 1132 TARIFF COMMISSION. [J. B. GRIXNELL. friend Philpott to know whether he was taking into account the freight. This I know, having been connected in a small way with railroads and railroad managers, that the cost of transportation from the city of Des Moines, or from Grinnell, where I live, to New York, is now just exactly 74 per cent, less than it was fifteen years ago. I have wagoned grain, by my employes, and I know that before the railroads came we wagoned grain 40 miles and received 40 cents a bushel for it. The first few years of my residence in the State wheat rarely brought more than 60 cents a bushel. Last year and the year previous it was almost double that. Those facts are the best statement I can make in regard to our produc- tions. What we purchase costs us less, and what we sell brings us more. But that is not all. The purchasers of our lands, by reason of the numerous railroads and cheap freights from New York, New England, Ohio, and Illinois, are willing to pay more. Of course this is a prohibition State, I am bound to say. I am bound to tell the whole truth if I can in the short time allotted to me. By the prohibition amendment to the constitution of the State the saloon has no legal existence in Iowa to-day. I do not wish to burden you with any threats in regard to your drinks at all, but if you get any here you will get them illegally. The landed interests of the State are very prosperous. City lots and farm lands have advanced at least 20 per cent, in the last three years. I know that to be a fact, and that is the testimony of real estate agents in the city of Des Moines and in the country. The newer sections of Iowa — the north and northwest, equal to fifteen millions of acres, or an area of the size of all New England, save Maine — have land well adapted to flax culture. It can be sown as the first crop, and to prepare foul land for corn, and before the time for corn planting. The seed now only is used for oil, and the flax straw is burned, involv- ing the waste of fiber, which should be utilized by factories for towel- ing, bags, rope, and twine. Under a higher tariff on jute, or jute butts, rope was made aud the tow was sent eastward. These competitors are Indian products with little substance, and they are now fraudulently used in heavy cloth, carpets, and for burlaps. It seems the duty of the government to prevent this imposition and encourage the use of the flax fiber. Tow of flax is now only $10 a ton. Some farmers think it should be $20 a ton. Flaxseed has 20 cents a bushel in way of quotation. It might be increased to 30 cents. If these rates would involve dearer oil to the consumer, it would be only temporary, since the use of the fiber would lessen the cost of the seed. Millions of acres are available for flax, and a strong competi- tion would arise, if the fiber found a market. The farmers invite the honorable Commission to keep out a free article and encourage the use of that which has real value. No farmer can dispense with bags, ropes, and twine, and the substitute of the self grain-binder, where one man by machinery performs the labor of six with twine, creates such a demand that I estimate that the next year one million of dollars will be required for grain twine alone. The good we seek is most apparent in a natural attraction of a new manufacturing industry towards our cheap food, ample coal measures, and water-power, furnishing employment for thousands of our farmers now idle in the winter, and utilizing a valuable fiber now supplanted by poor goods made on foreign soil. We trust in Congress for legislation which may avert this waste and be in the interest of a sound financial policy, aiding Iowa in her march to eminence in manufacturing and to J. B. GRINXELL.] FLAX, WOOL, ETC. 1133 tlie liigli rank as a fabricator which she now holds as the leading agri- cultural State of the Union, though not one-half her domain is utilized. Her lands were never selling so rapidly and at such high prices as now, under the stimulus of railway building, the growing prohibition senti- ment, and the promise of an adjusted tariff at your hands as the pledge of a stable and beneficent policy in the interest of all classes. When I advocate a tariff*, I appeal to the facts of history to show that competition has brought us lower articles. It has brought us cheaper cloth than this w^orld ever knew. It has brought us cheaper farming utensils than were ever heard of. It has brought us Bessemer steel at $40 a ton, which formerly cost from $150 to $160 a ton. Therefore, I say, put this tariff upon flaxseed and upon jute butts, and you encour- age one-third of this State. You encourage the people that are to dwell upon fifteen millions of acres of fertile soil to enter upon flax culture, and they will so compete that we will in the end have cheaper oil than now. What else shall we have? If it is said that bagging will be higher for handling the grain, I answer that it will be better, as much better as linen is better than cotton — with all deference to the honorable Com- missioner from the State of Georgia. We know that linen in the history of the world is preferred to cotton. The bagging would be better, the toweling would be better, and this linen which would go into the manu- facture of carpets in place of jute butts would have a value, whereas 1 he jute butt, as it is beaten up and picked after the manner of shoddy, has little value. We shall encourage and build up a new industry and save for the farmer. We shall then establish these bagging factories, which will be found wherever there is water power and fuel, and it will prove to be a boon wherever there is water and an abundance of coal. These manufactures will spring up all over the Northwest, and that is one of the beauties, gentlemen, of the protective tariff that we wish to have exhibited here. I beg leave to call the attention of the Commission to the fact that one of the great drawbacks to agriculture in this country is that in the winter the farmer has nothing to do. He works hard six or eight months in the year, and the balance of the time he is at rest. But if he had some employment of this kind, he could utilize his time after the crops are gathered and the frost has come. If we had flax manufactories, we could make our own bags, our own linen cloth, our own ropes, and whatever could be made from this flax fabric. That is my idea of manu- facturing. It is my idea of the tariff*, and it is my idea of the province of this Commission, to give us in the State of Iowa, the youngest of the States, comparatively, on the frontier, although boasting of rich soil, and favorable climate, and industrious people, some of the benefits that grow out of this tariff*. Judge C. C. Cole has called my attention to the fact that there is a colony called Amana in the southern part of the State, where they make their own flax. I have used the towels they make; the flax is grown there, rotted there, and manufactured on their own soil. I call that true independence. And I want to say in regard to Cedar Eapids that they have considerable encouragement there. Tney have used their fiber there in connection with paper making to some extent. I would be very glad to accompany this Commission upon a visit to the Amana community, where they could see one of the most prosperous communi- ties in this State — a community that lives on the tariff principle strictly. The consumer and producer are neighbors. The boys and girls work in the winter as well as in the summer. One more fact in connection with this. It has come to pass that the 1134 TARIFF COMMISSION. [J. B. GBINNELL. methods of farming have entirely changed in this State. When I came here 20 years ago, it was the bnsiuess of six men to bind after a reaper that threw the grain down, and that w r as hard work. Then another man set up the grain. What has come to pass now ? The header takes off the top of the grain, as you may have seen it in Manitoba. The header is about to do away with all this labor of men bending over and making a band of the straw to bind the grain. It is done now by the self-binder, and by the use of these self-binders one man who drives the machine can cut 15 acres a day. At first, with these self-biuders, they utilized wire. But that was found to be destructive to cattle when they came to consume the straw, and it was also injurious to the thrashing machines ; so they now use twine. Where does that twine come from and what is its cost? That twine will cost the people of the State of Iowa next year not less than one million dollars for binding wheat and oats. It must come from Connecticut or New Jersey, and it costs 25 cents an acre for that twine used in binding. If you will recommend that jute butts and, perhaps, fiber should be subject to a higher duty, and a little more duty upon oil, we shall be able to establish manufact- ures for linen, for ropes, and for different articles necessary for our farm- ers in tying up their grain, and you will have caused them to expend among themselves one million dollars which now goes to other States to make rope or to make twine necessary to bind their grain. You will have caused the flax to be saved and not to be burned. I present that as a new feature of economy. I present it as a political economist, as a social economist, as that which we shall demand of our representatives. I know, and I think I can confidently say, that any rejmrt of this Com- mission, or any other, to receive their sanction, must be an encourage- ment to the flax growers that are found over nearly one-half of this State, to the end that w’e may make our own bags for grain, our own ropes, and our own twine, and that the home industry may be used in these wastes, where now the prairie produce is swept away by the prairie fires. By Commissioner Oliver : Question. Is flax now raised here only for the seed ? — Answer. Only for the seed, with rare exceptions. Q. You mention that Amana community. I suppose they have cheap labor. — A. Yes, sir ; the women and everybody work. Q. Can you approximate the quantity that is raised in the State of Iowa? — A. It is not far from 15,000,000 bushels. I will give the exact figures and the number of acres hereafter. Q. And after using the seed the remainder is burned or destroyed? — A. Yes, sir. Q. If you had cheaper labor you could utilize it now, could you not? — A. Oh, yes; but we cannot compete with the labor abroad. Q. How much more would you want the present duty increased to be able to make a home market ? — A. I want $30 a ton on jute butts, which I call a fraud ; I want 30 per cent, more on flaxseed. Q. Where would you have to seek a market for this article ? — A. Among our own people ; 1,700,000 people would use this rope and twine. It is in every store, on every farm. Every farmer lias to have bags, and we would go to making ticking and the coarser cloths. Mr. C. C. Cole. Senator Allison suggested that they could not have time to rot it. He spoke of the fact that the acreage of the State is about equal to that of wheat and its yield is about the same. It is a more certain crop; it is more cheaply harvested, and as cheaply J. B. GRINNELL.] FLAX, WOOL, ETC. # 1135 marketed, or more so. The fiber is good, and with labor they would take it and break it up without rotting it ; and Senator Allison remarked that it had been sent to some manufacturer in Illinois and made into very coarse burlaps, used for wrapping the coarser woolen goods, and it might be that more protection, or some further invention in respect to it, might convert it into a much more desirable and valuable material. Commissioner Oliver. The rotting process requires plenty of water? Mr. Cole. And time. Mr. Grinnell. I should have stated that our climate is such that flax will rot from the time it ripens until winter. It will rot sufficiently in an ordinary season so that it can be hatcheled and utilized. After the statement of Mr. L. W. Goode, Hon. J. B. Grinnell further stated as follows : I made my statement in a general way, but I think with authority. My friend Goode may be entirely correct in what he says about two members of Congress having been called upon to make free-trade speeches, as he understands. But I will offer as a premium to purchase a suit of clothes for every person in the room who will produce a free-trade speech made by either of the members named. Mr. Goode. There is a free-trade speech from Mr. Far well in the Marengo Messenger. Mr. Grinnell. Have you the speech here ? Mr. Goode. I have not ; but it was a speech that our Free Trade League would call free trade. Mr. Grinnell. I find the term “free trade” applies to many varie- ties. I know that Mr. Farwell was a Whig, and I have heard him ex- press as strong tariff' sentiments as I have ever heard by anybody in my acquaintance with public men. I will state in that connection, that there was a very prominent free-trade organ in his district, to wit, the Davenport Gazette, edited by a man of marked ability, a resident of this State nearly thirty years, English born. But the paper could not survive under its free-trade principles, and Mr. Russell has retired, and the leading paper in that district now is an outspoken tariff' commission paper. It advocates the tariff' commission and at the same time the tariff ; and I am not in the habit of making the acquaintance of members of Con- gress who go against the leading daily paper in their district. The only prominent free-trade paper in the State of Iowa that I ever was ac- quainted with has changed to a tariff paper within the last four to six weeks. But in regard to Mr. McCoid’s district, I simply wish to state that the daily press (The Hawkeye and the Gate City) are both tariff' papers. The other matter I wish to allude to is in regard to paper. Flax fiber enters quite largely now into the manufacture of the finer kinds of paper. I talked with a gentleman who had been before you, Mr. Wellington Smith, I think his name is, and he said he wished to see this industry stimulated, because they could use the flax fiber in their better kinds of paper; that it gave a better finish. And that is another reason why we wish to see the flax industry encouraged here. Another fact is that we are competing with the world under this tariff. The facts show that we export paper in competition with Great Britain to South America, Australia, and other countries. And it is no small amount. The reason why the gentleman here did not buy his paper in Canada was because it was an inferior article. He could not bring it here unless he wished to expose an inferior article. I give these facts only in justification of what I said, that a judicious tariff always pays, 1136 TARIFF COMMISSION. [J. B. GEIXNELL. as it lias done in regard to railroad iron, printing machinery, spades and shovels, and agricultural machinery ; else we could not compete with the old world with its cheaper labor, lower money, and organized capi- tal. 1 believe that is demonstrated. I remember one bill that I paid for my paper six or seven years ago of 9 cents a pound, and another at 9J. I am told that it can be bought now for 5g or 6. I mention this fact, occurring under my own observation, to show that as a reader of news- papers — I am supposed to have thirty or forty coming to my house, so my wife says — I do not wish any change in the tariff on print-paper. It is low enough, and if you will keep it where it is we will make paper here in Des Moines, using our water-power, and we can compete with the world and get good prices, and remunerate labor. On September 16 Mr. Grinnell added the following further state- ment: I beg leave to make a statement in regard to the sheep interest re- ferred to by Mr. Gue. I can say that I have been a great sheep man in the matter of bringing them in, although I am not one who has made the money. I have brought more sheep into the State of Iowa than any five men. The occasion of the decline of the sheep industry may be stated thus: The war stimulated wool-growing immensely in this State. I sold my wool several years at 75 cents to $1.05 a pound. I was in the habit of sending it to David Dows, an eminent commission merchant in New York, and he sent me a draft for $10,000 for my wool for a single season. At the close of the war everybody was anxious to have a con- tract, and clothing and everything of the kind accumulated greatly. Sheep then began to decline in price, and wool also. At that juncture there was a remarkable revival in the stock business. A great many of our sheep became diseased by being brought together in large quan- tities, and also on account of the introduction of disease from Ohio. Michigan, and other States. The people who had my sheep out on shares — I had at that time six or seven thousand — said to me, “You won’t compel us to keep these sheep now, when we can get $6 for pork and cattle"?” I said if they desired to do so to bring them back, and they brought them back, and they changed their occupation to the raising of cattle and pork, and I transferred those sheep to Colorado. The last thousand I had 1 sent to Colorado, and I saw their descendants last winter there in Arizona, New Mexico, and California. The dogs, low prices of wool, and the cessation of the war, together with the fact that another industry promised larger returns, were the causes of the decline in the wool business. In that connection I will state that, of my own knowledge of the facts, there never was in the history of this country so much wool produced as there is to-day, and never of so good quality, according to the testi- mony of every one, so far as I know. Also that the cloth, such as I and most men wear, was never so cheap by 10 to 20 per cent, as it is on this 16th of September, 1882. I give that as the testimony of the manu- facturers of woolen goods. 1 believe it is a fact, from my own purchases and from my observation of sales. I will give an illustration: At the tariff meeting held in the city of New York some of the gentlemen ex- patiated on the high price of clothing. There arose in the convention a Pennsylvania gentleman, and said: U I am here as a standing illus- tration that the statements made by the gentleman are not true. I am not good looking, but I am well dressed. I have on a suit of clothes that 1 have worn in Europe, Asia, Africa, and America for the last nine J. B. GKINNELL.] FLAX, WOOL, ETC. 1137 mouths, and that suit only cost me $15, aud it is good for several mouths yet.” (A Bystander. Where did he buy them?) Mr. Grinnell. In the city of New York. And I will say that I saw in Chicago a better suit of clothes than I am in the habit of wearing, for the same price. I do not mean to say they were made by a mer- chant tailor. A man in my employ said he had a suit of clothes that he bought for $13, and he looked well enough to go to a wedding. I will say that the protective tariff, in my judgment, has stimulated the wool industry in this country in competition with that of South America, Australia, and the Cape of Good Hope, so that we have more sheep than ever, and more wool and of better quality ; and we have cheaper clothing and wear better clothes than we have ever done in this country for thirty years. H. Mis. (J 72 1138 TARIFF COMMISSION. [H, A. KOBLE. H. A. NOBLE. Des Moines, Iowa, September 15, 1882. The following communication from H. A. Noble, representing the Baker Manufacturing Company, of Des Moines, Iowa, was read and ordered to be printed : To the honorable Tariff Commission : Gentlemen: As far as the manufacture of barbed wire in this State is concerned, I will state that it is generally conceded that the State of Iowa consumes more barbed wire than any other State in the Union, Illinois alone, perhaps, excepted, although many doubt that the latter State is the largest consumer. There are manufactured in this State, according to the best informa- tion we can get, about 10,000 tons of barbed wire per annum, besides a large amount through the State on hand machines, which, o;i account of operating without license from the parties claiming to own the various patents, both on machines to manufacture the wire and the barbs of various devices put on the wire, they manufacture with as little pub- licity as possible, making it very difficult to form any correct estimate of their production. We, however, think we are safe in estimating that not less than 12,000 tons of wire are barbed in this State per year, and more than that consumed. The wire used for making this barbed wire is all steel wire, and pro- cured from wire-drawing mills that are located, with the exception of Saint Louis, Cleveland, and Chicago, in the Eastern States and Penn- sylvania, and are drawing the wire mostly from German rods. These foreign rods are classed under the ruling of the Treasury Department at a rate of duty that is generally satisfactory. We understand that the steel manufacturers and wire mills ask that the ruling of the Treasury Department be overruled by Congress, so that the duty on foreign rods will be greatly advanced. AYe think that such an advance would be against the interest of the W estern agri- cultural States, who are the principal consumers of barbed wire, as an advance of, say, one cent per pound only on 12,000 tons of barbed wire consumed in Iowa alone, would be $240,000, which would be a tax on the consumers mostly, which, in our judgment, would be unnecessary to give good protection to the steel interests of this country. In the matter of wages paid to employes in the barbed- wire factories in this State, from our own experience and careful inquiry of other manufacturers, we should say that the average wages per day for each laborer was $1.75. Respectfully, yours, Des Moines, Iowa, September 15, 1882. H. A. Noble, L. W. GOODB.J PAPER. 1139 L. W. GOODE. Des Moines, Iowa, (September 15, 1882. L. W. Goode, editor of the Iowa State Leader, stated as follows: I was appointed on one of the committees by the board of trade of this city to appear before this Commission, and the suggestion was made that I should speak more particularly as regards print-paper, aud generally upon the subject of paper. I have spent some little time going over the city in company with Mr. W. E. Andrews, of the West- ern Newspaper Union, for the purpose of investigating the subject. We discovered that we have the third largest house in the United States dealing in wall-paper. They are handling over a million and a quarter pounds of wall-paper annually. I have not the figures exactly at command as to the rate of duty on that, but my impression is that it is perhaps from 30 to 35 per cent. The annual value handled by that house is about $170,000, I am told. In print-paper the amount handled here is somewhere in the neigh- borhood of 100,100 pounds per month, and that is a low estimate. It will run over that, to 160,000 pounds sometimes. The duty on that is 20 per cent. Now, so far as I am concerned, 1 have no personal grievance in regard to the tariff, because I pay it to the manufacturer and charge it to the man to whom I sell the paper. The only thing I could urge here would be, if the tariff was taken oft*, I could furnish the paper that much more cheaply. The scope of the print-paper of course is a limited one, and I do not care to dilate upon it at any length. The Western Newspaper Union, which furnishes patent insides for small papers all over the Western country, have their main office here, and a branch office in Kansas, another at Saint Paul, and another at Detroit, and perhaps two or three other offices. This matter affects them even more than it does us, or fully as much, because papers that they sup- ply with their insides are usually small concerns, and are scattered over a wider range of country perhaps even than the Leader goes over. I had hoped that Mr. Andrews would be here. I gave him rather the statis- tical department, and I expected to supplement Mr. Philpott’s state- ment. If the Commission have no objection, I would like to add a few facts to those given by Mr. Philpott. Iowa prices have been compared with New York prices here this af- ternoon. I think it will strike every member of the Commission that it is eminently fair to use the New York prices, for this reason. The Iowa prices, as has been suggested by one gentleman, have been liable to fluctuations on account of freight. When Mr. Grinnell was on the stand, he remarked that prices were very much higher a few years ago than now, for the reason that there were then no railroads. This State stands to-day about number six in the United States with railroads, and we can get freights from New York very low. The price of our corn, oats, cattle, and pork is all regulated by the Liverpool prices ; at least, that is the position taken by the free-trader, and I think business men gen- erally admit that. If that be so, the only price that can be taken as a criterion is the New York price. That price is not liable to fluctuation 1140 TARIFF COMMISSION. [L. VV. GOODE. like ours, because if the Liverpool price governs the Iowa price, then the Iowa price is always the Liverpool price less cost of freight from here to Liverpool. Mr. Grinnell also made a general sweeping statement here, that there were very few farmers in this State interested in free trade. Of course that is a glittering generality. I don’t know that I could attack it specifically. I could, however, demonstrate in a very short time to mem- bers of the Commission that we have any quantity of free-trade farmers all over the State. I think it is only necessary to call the attention of the Commission to the fact that four of our Iowa members of Congress voted against the creation of this Commission to demonstrate it ; also that Mr. McCoid, who was nominated a short time ago, explained his vote on this Commission and made a iree-trade speech. Mr. Farwell also made a free-trade speech. Politicians are pretty good indices of the state of public feeling, and when you find them beginning to trim their sails upon any subject, you may know that they have at least a respectable amount of public sentiment to back them. I had intended to attach to my remarks a few letters from some of our prominent farmers, to give the Commission some idea in regard to the character of free-trade agitation, but I don’t know thar I care to go into that now at any lengh. As one of the officers of the league, I have had to a certain extent a good deal to do with detail work, and have been with Mr. Philpott a great deal, and am ready to answer any ques- tions in regard to our work through the State and the West. By Commissioner Oliver : Question. You are speaking of paper particularly, being interested in that subject; you have stated that the duty does not make very much difference to you; that you simply add the duty to the price of the paper and charge it over to the consumer. If this 20 per cent, was taken off, the consumer would get it that much more cheaply? — Answer. A large per cent, of it. Q. Can you tell me what is the price of your print-paper in any cen- ter of the West — the average price for the last six months in Chicago, for instance ? — A. The average price is lower than it has been for two years. It is in the neighborhood of 85,75 to 86. Q. It has been stated to us on excellent authority that it is just ex- actly the same price in England and in America. If the price of print- paper is the same, I would like to understand how taking off the duty of 20 per cent, would help either you or your customer. — A. It might not just at the present time ; it is certainly of no benefit. I will state for the benefit of the Commission that Mr. Andrews informed me to-day — and I expected him to make the statement himself — that some time ago he made an attempt to get his paper in Canada, and that he found that he could lay his paper down and pay the duty on it cheaper than he could buy it in the United States. By Commissioner Aalbler : Q. What was the then price of paper here ? — A. My impression is, about 7 cents. By Commissioner McMahon : Q. Was that paper to be got from Canada the same quality to be ob- tained here? — A. I understood so. Q. Do you know what amount of paper in value is used in the United States in the course of the year ? — A. I never made a computation, Q. Have you any idea of it? — A. No, sir. h. W. nOODE-1 PAPER. 1141 Q. Do you think it runs into millions ? — A. I presume it is a very large amount. Q. Do you know what amount is imported into this country? — A. I understood a small sum. I have no definite figures on it. Q. Do you think taking off this duty of 20 per cent, would, if not im- mediately, in time, inure to the benefit of the subscriber who pays from 3 to 5 cents a copy ? — A. 1 think possibly he might not get the benefit of all of it. Q. The statistics here for the last three years show that paper used for books and newspapers in 1879 was $660 worth; that in 1880 there was $1,000 worth ; and 1881, $59,000 worth, imported into the United States. When you come to distribute that among consumers of paper (the readers) it would make very little difference. — A. It probably would not if the tariff is still retained on wood pulp. Q. Whether it is or not, I suppose you will admit that $60,000 distrib- uted among the fifty millions will not make a very large difference ? — A. No, sir. By Commissioner Oliver : Q. You have reiterated the remark of Mr. Philpott, given here to-day, in regard to New York quotations of wheat. Do you not consider it very unfair, when the rate of freight 20 years ago was at least a dollar per hun- dred from this point to New York, to give to us a comparison of the prices of wheat upon that basis ? — A. 1 say the New York quotation is the only quotation you can make, for the very reason you give — that the varia- tion in freight makes it exceedingly unfair to take the rates in any one of the States, especially when you take into account the fact that one of our Western States settles up very rapidly when the railroads begin to come into it. You must have some permanent place where the fluctu- ation is not perceptible. That place naturally is New York, the great shipping port. Q. And you give it to us as an argument that we should reduce du- ties, because in 1855, for instance, wheat was worth $1.50, and at an- other period, between 1870 and 1880, it was worth 80 cents, when one- half of that difference is made up on account of the excessive freight rates. With only one railroad at that time the freight rate must have been excessive, and the farmer at that time did not get half the price in Iowa or Illinois that he does to-day ? — A. The price was regulated in Liverpool. Q. The question is what the Illinois or Iowa man got for his wheat in 1855 and 1875, without any reference to Liverpool.— A. I contend that it is unfair to take the prices here in Iowa. I think the only price that you can take that is at all suitable in regard to the exports of this country, is the New York price. You might say in that connection that the ocean freights fluctuate to a certain extent, and that would have its effect upon the Liverpool price. The New York price is governed by the Liverpool price. By Commissioner Ambler : Q. Is that a statement of the whole truth? I know it is very com- monly said, but, after all, is it true that Liverpool regulates the prices ? — A. I think it is substantially true. Q. Is not this the fact, that the price is regulated by the entire sup- ply and the entire demand, and that Liverpool, instead of making the price, is merely the place where the prices are made ? — A. That is so, and when I use the term “Liverpool fixing the price,” I mean that the price there governs the price in New York and Chicago. 1142 TARIFF COMMISSION. [l. W. GOODE. Q. That may be so, but, after all, does not the supply of wheat iu New York and Chicago, and all over the world, make the price at Liver- pool ? — A. It is regulated by the law of supply and demand. Q. And all there is iu this idea of Liverpool fixing the price is because that is the greatest market ? — A. Certainly. Q. So, after all, Liverpool makes no prices ; but, on the other hand, the law of supply and demand makes prices, and Liverpool is merely the place of registration ? — A. Certainly. Our Iowa shippers scan very carefully the Chicago market and govern their action accordingly. Q. Then it is because it does regulate the entire market that you go there ? — A. Certainly. Q. It seems to me that it is hardly fair to say that Liverpool makes the price when you and I agree perfectly that it is the aggregate sup- ply and demand that make the price ? — A. You might state it that way. Q. What proportion of the wheat, for instance, in this country, or, in general terms, of the agricultural products of this country, finds a foreign market at all ? — A. I believe it is less than 10 per cent. ; I can- not tell exactly, offhand. Q. In England they do not buy any wheat from us except what they need. We cannot possibly supply any more wheat to Great Britain than her shortage amounts to. In fact, we cannot supply that much. If that was our only market and we had our present production, would it be worth anything here? — A. Yes, sir; it would be worth the price that our dealers could afford to pay and ship to Liverpool. Q. The moment you had filled Liverpool up, how much would they take from you?— A. We do not supply them with their shortage. Q. But suppose you have supplied their shortage, then what ? Of course you would have to supply the shortage in competition with the Black Sea. — A. Mr. Philpott tells me that we export about 40 per cent, of our agricultural products. I have not the figures. Q. Suppose it is 40 per cent. Then if we had the other 60 per cent, demand rubbed out, where would we be? — A. Just as I said before; it would depend altogether upon what our shippers should send to Liver- pool and sell it for. Q. But if they do not want it there? — A. We have got that market and have to be governed by it. Q. That is to say, if the 60 per cent, was put upon the market, the result would necessarily be a glut and a reduction in the price of wheat. — A. It would have the effect to lower the prices. Q. Yerv materially? — A. It would wipe out the whole market en- tirely. Q. The price here in Iowa would probably come down one-half, would it not ?— A. I never estimated it. Q. It turns out, then, that the home demand, as well as the foreign demand, makes the price. That is correct, is it not ? — A. I assent to it. Of course, we have a demand at times when we have very little wheat to export. Very naturally, when that condition of affairs arises the price of wheat goes up. Our export is the safety-valve to let off the surplus. By Commissioner McMahon : Q. In such a state of the case, I understand you that the whole de- mand is the first factor, and that the Liverpool demand is the second ? — A. It is always the first in any country. Q. What did I understand you to say about wood pulp ? — A. I re- ferred to it but once, referring to the importation of paper having any r,. W. coodj!.! PAPER. 1143 appreciable effect. I mentioned the fact that there was a duty on wood pulp, and if that was not abolished it would, of course, have its effect upon the price of print paper. Q. Do you know how much wood pulp there has been imported?— A. No, sir; I have never gone into the statistics at all. Q. But you still think it has an effect upon the price of paper?— A. Yes, sir. Q. You do not know the amount of print paper used ? — A. I cannot give it. Q. Statistics show that there was $152.80 paid in 1879 on pulp ; $1,001.50 in 1880, and $3,017.40 in 1881. — A. I will state that my idea of the effect of the tariff is not governed at all by the importations. The fact that there is a tariff* must affect the prices. For example, two years ago our mills had on hand about 250,000 tons of paper. Paper was very low. An order was issued commanding the mills to run on reduced time, and some, perhaps, quit altogether until their supply was reduced. The price was then run up until papers in this Western country were forced to pay 9 cents a pound in Chicago. 1 contend that that condition of affairs could not happen under free trade, because the moment the attempt was made to increase the price by an effort of that kind an opportunity would be given for bringing in foreigu goods. Q. You say it does not affect the increase ; does it affect the decrease of prices ? — A. It did affect the increase of prices in that case. Q. On a basis of 20 per cent, duty it could not afford to be imported, as I understand you, between the prices of 5 cents and 9 cents a pound? — A. I don’t know that it was 5. I mean 5.75 and 6. Q. Twenty per cent, of 0 does not bring it to 9. So 1 do not see how that would affect the tariff*; do you? Mathematically 20 per cent, on 6 cents does not bring it up to 9. — A. Certainly not. 1144 TARIFF COMMISSION. [J. S. ANDERSON. J. S. ANDEESON. Des Moines, Iowa, September 16, 1882. Mr. J. S. Anderson, pork packer, of Des Moines, addressed the Com- mission as follows : I want to give you some facts : The total number of bogs packed in Iowa is approximated at about 1,000,000 bead. Tbe amount of salt used is about 16 pounds per bead, making 16,000,000 pounds, of wbicb about one-tbird is foreign salt, making about 5,500,000 pounds of foreign salt used at an average cost of 70 cents per hundred, or at a cost of $38,500. Domestic salt used, 10,500,000 pounds, at a cost of, say, 37J cents per hundred, making $39,375. By Commissioner Ambler : Question. You use tbe foreign salt; that, of course, answers tbe pur- pose? — Answer. Yes, sir. I might say that those who pack in this country for tbe foreign market use foreign salt, and those who pack for tbe domestic market use tbe domestic salt. Q. Those packing for foreign market have a drawback, I suppose?— A. I could not say. We pack particularly for tbe domestic trade and sue domestic salt. These are tbe approximate figures of tbe product. G. W. AV. WERUM. 1 FLAX. 1145 G. W. W. WEKUM. I)es Moines, Iowa, September 10 , 1882 . Mr. G. W. W. Werum, of Des Moines, addressed the Commission as follows: I will say on behalf of the linseed-oil business that I think you will find all those engaged in its manufacture west of the Alleghany Mount- ains are in favor of leaving the duty as it is ; they do not wish it in- creased or lowered. East of the Alleghany Mountains I think they are in favor of putting linseed oil upon the free list, for the reason that they work largely upon foreign seed, and, of course, their interest is to have linseed oil upon the free list ; whereas west of the mountains, where we work American seed, we are in favor of the duty, and are perfectly well satisfied with the duty as it is. The business has so adjusted itself to the present duty that it gives perfect satisfaction. I came to this country and here engaged in the flax-fiber business, building a mill in this city. I was sent here by a syndicate of flax-fiber men in Ohio, with a view to test the quality of the fiber of this section of the country, in contem plation of building spinning-mills in Des Moines. 1 came here and built a mill, and found that the fiber was as good as we had in the country ; the quality was perfectly satisfactory. We ran the mill the first year at a profit. At that time there was a duty on foreign fiber. Before I went into the second year’s business the ar- ticle of jute was discovered and commenced to be imported, and the owners of all the spinning-mills of this country, finding that they could get jute butts cheaper than they could get flax fiber, became free-traders, whereas before that they were protective men. They began to want free jute. The consequence was that there was an influence brought to bear upon Congress that put flax and jute butts upon the free list, and that shut us all up. We now have two sets of machinery that have been lying idle for years. I am not now interested in the fiber business, except indirectly. I should be perfectly satisfied if there was a duty upon foreign fiber about equal to the duty upon other gcods. It would be one of the largest businesses in the United States, and would employ as many people as any business in the country. I have experimented with jute to some extent myself, and have satis- fied myself that it cannot be raised in this climate ; it is too cold. But I am fully satisfied, from my experiments, that it can be raised in the South, and I believe B would be found to be as profitable as any crop which they raise ; and if it had a duty put upon it about equal to that of other goods, it would also help the flax-fiber business North. I have no suggestions; but I think if you will examine you will find the manufactures of jute fiber are almost at the head of our list of im- portations, and yet there is no country in the world that can produce it better than this, but it cannot be produced here if it has to carry the weight of this duty upon its shoulders. I am satisfied in my own mind that if there was a duty levied upon all imported articles you would find that the fiber business, both jute and flax, would become one of the largest in the country ; but it must have a protection that would put it upon an equal footing with the others. The idea of $6 a ton upon imported jute amounts to nothing. I found that flax-seed had a pro- 1146 TARIFF COMMISSION. TO. W. W. WERTTM. tection and the flax-seed business was getting larger and larger every year. The consequence is that the same mill we had for fiber we turned into a linseed-oil factory, and are working it for that to-day. I have given the matter a good deal of study, and I speak more for the parties who want to engage in the business than for myself. I know the position they are in. Of course they are weak financially. But, still, I think if this protective tariff is levied upon imported articles, upon patriotic principles, if that is done for the benefit of the American people, it ought to be upon this, which, I think, is a business that is en- titled to protection just as much as any other business. According to the old saying, man is selfish, and those who have come before you have their own stories to tell according to their individual interests ; and you probably feel a good deal like the man who went to the Cen- tennial, who said afterward that the thing was all in a mist so that he could hardly tell what he did see and hear. You, however, want facts and figures, and those are the only things you can refer to, so that a speech like I am making will do you little good. There is no better country in the world for the production of flax fiber than Iowa. It is particularly adapted to it. And I will say further, that if there is ever a manufacturing interest built up in the Western country, they must get their raw material from the surface of the soil. We have no coal of any consequence. There is nothing that will supply the raw material so well as flax fiber. The same way in the South, though they have cotton there. But I will say here that the great bulk of coarse fiber used for making bags for cotton is made from this foreign jute, and they could raise the jute and manufacture it in the South. They are one of the largest consumers of jute. There is no business that would benefit the South more than the jute business, and I think protection should be put upon it for the benefit of the South, if not for the benefit of the flax interest in the North, but undoubtedly it would benefit both classes. By Commissioner Oliver: Question. Why can you not manufacture these different articles now? — Answer. Simply for the reason that the spinner can buy the jute butt cheaper than he can make flax tow, and for that reason alone. If a man is manufacturing tow, and has to j>ay protective tariff prices for labor, it will shut him up every time. Q. Then, the reason is because your labor is too high? — A. The labor is too high for the price we get for the goods. There is no question about the raw material ; there are thousands of tons coming to us here, and if labor were as low as it is abroad we could do one of the best businesses in the country. Q. Then, what you want is protection to just the amount of difference in the labor? — A. Yes; just to put it on an equal footing; that is all it requires. W. E. ANDREWS.] PAPER. 1147 W. E. ANDREWS. Des Moines, Iowa, September 16, 1882. Mr. W. E. Andrews, of the Western Newspaper Union, addressed the Commission as follows : I have been requested, as one of the largest consumers of print paper in the West, to give my views regarding the tariff on paper, and its effects. I had made no preparation to do so until scarcely an hour since, so that what I have to say will necessarily be somewhat crude and brief. The Western Newspaper Union, of which 1 am manager, uses over 125,000 pounds of print paper each month at its different offices, including, besides its principal office here, branch offices at Detroit, Omaha, and Kansas City. We supply what are known as ready-printed or auxiliary sheets to over five hundred imblishers in the West, located principally in Iowa, Nebraska, Kansas, Missouri, and Michigan. 1 will say simply that at the present time I do not consider the tariff on paper a burden, either to our company or our customers, or to any one, for the reason that the manufacturers of print paper, those of the West as well as of the East, are producing a better quality of paper for the same money than the Canadian paper makers. Of the quality of goods and the condition of the paper market in countries more remote 1 am not at present advised. While I admit that just now the tariff on paper is no burden to the consumer, yet I am emphatically of the opiuion that there is no necessity for a tariff at all, and that its abolition would be of practical benefit to the consumers of paper. A good many cogent reasons can probably be given why the tariff should be taken off from paper and the items which enter prominently into its manufacture, but there are two in particular that occur to me just now. First. The tariff becomes a disturbing element in the paper trade, be- cause of the fact that it enables the paper makers to more easily manip- ulate the market. For instance, during the years of 1879 and 1880 the price of paper was low. In the summer of 1880 we were able to buy No. 1 print for 6 cents per pound. The supply of paper in the country was very large. The paper makers met in convention and agreed to run on half time, which they had a right to do, but when the supply on hand had been reduced nearly two-thirds they made the next move on the board, which was to put up its price, and with a vengeance. Paper went from 6 cents to 9 cents per pound almost instantly, and was held there firmly for over six months, until the return of summer and decrease of demand, together with overproduction, broke the back of the combination, and paper gradually declined until it is now back again to the old price, ranging from 5J to 7 cents per pound. Had it not been for the fact that we happened to have time contracts at a reason- able rate, the cost of the paper used by us in the first half of 1881 would have been an average of over 50 per cent, greater than for the corres- ponding period of 1880. And we would then have been compelled, dur- ing that time, to have charged our ready -print customers an aggregate excess of over $25,000 for the six months’ supply. Now, I submit that but for the tariff the paper makers would not be able to force the market in such a way and to such an extent as I have described. Second. The non-necessity and inconsistency of the tariff is shown by 1148 TARIFF COMMISSION. [w. it. ANDREWS. the fact that our papers makers are at this time shipping paper to Canada and other foreign countries, and actually paying entrance duty on some of their shipments. The manufacture of print paper in America has now reached that stage when it is able to stand alone and requires no protection by way of tariff. Our Congressman, Mr. Kasson, admits that the duty should be taken off* rags, and I understand that rags for manufacture of paper are free. Why not go farther and take it from wood pulp, which now enters very largely into the manufacture of print paper? 1 hope and believe that a thorough examination of this ques- tion will result in a recommendation by this committee to the Congress that paper, as well as rags and pulp, be added to the free list. I would say byway of excuse for saying so much of what might seem a personal nature, that I intended it only by way of illustration. I had considerable correspondence during the time of the great in- crease of the price in print paper, two years ago, with Canadian paper makers, and learned that I could obtain i^aper at that time, delivered in Des Moines, at a rate of about 60 cents a hundred, I think it was. That . was cheaper than I could obtain the same grade of paper for in the market here at that time. But personally I did not need to use it at that time. If the combination had continued a sufficient length of time 1 should x>robably have had occasion to do so. B. F. GUE.] REDUCTION OF DUTIES. 1149 B. F. GUE. Des Moines, Iowa, September 16, 1882. Hon. B. F. Gue, editor of the Iowa Homestead, addressed the Com- mission as follows: Gentlemen of the Tariff Commission : I have been requested to present to you some facts showing the bearing our tariff laws have on Western agriculture. Having been educated in the school of high “ pro- tection,” as taught by the New York Tribune, which I have read for more than thirty years, and trying to reconcile its teachings with West- ern farm interests during the twenty-two years that I have been en- gaged in farming on Iowa soil, I have often been puzzled to know where, when, and how Western farmers are benefited by a protective tariff. I have observed that in the Mississippi Valley during the thirty years that I have lived in it, the production of wheat, corn, oats, rye, barley, hay, flax-seed, cattle, hogs, horses, sheep, beef, and wool, is the great and overshadowing business of this part of the country. I find in our own State by referring to the last auditor’s report (page 75), a table showing the number and value of the live stock of Iowa from 1867 to 1881, a period of fifteen years. From this I learn that in 1867 we had 686,109 head of cattle, and in 1881 we had 1,962,992, an increase in fifteen years of 1,276,883, or nearly 200 per cent., while the value has increased in the same period more than $12,000,000, or 150 per cent. The number of horses in 1867 was 343,693, which was increased in 1881 to 706,546, a gain in numbers of more than 100 per cent. The number of swine in 1867 was 776,412, which in 1881 had increased to the enormous number of 2,219,402, or about 200 per cent. In the season of 1880-’81 there were packed in Iowa 648,316 hogs, for which Iowa farmers received $7,406,298. How many more were sent alive to Eastern markets I cannot learn, but the number was very large. Of grain produced in 1881 it may be said that the crops of all kinds were the lightest per acre that they have been since 1868. Still we find that of wheat we produced 17,400,000 bushels, valued at $18,270,000. Of corn we had about 200,000,000 of bushels, valued at $86,000,000. Of oats we had 50,000,000 bushels, valued at $17,000,000. Of barley we had 3,290,000 bushels, valued at $2,204,000. Of potatoes we had 6,000,000 bushels, valued at $7,000,000. Of hay we had 3,247,900 tons, valued at $21,000,000. Adding the product of flax, rye, and sweet potatoes, these grain and vegetable productions reach a total value of $157,822,503 in the year 1881, which gave us the smallest crops that we have harvested, for the area planted, during a period of thirteen years. And in this year of partial failure we sent by rail to Eastern markets 53,000,000 bushels of corn, 10,500,000 bushels of wheat, 13,000,000 bushels of oats, 1,600,000 bushels of barley, 760,000 bushels of rye, and 210,000 bushels of pota- toes, besides large amounts sent to Southern and Western markets, of which we have no exact record. Our dairy products have increased as our wheat production has di- minished. In 1870 our exports of butter and cheese were valued at $592,229. In 1881 they had grown to $20,000,000. Without enumerat- ing all of our vast agricultural productions, enough has been given to 1150 TARIFF COMMISSION. [E. F. (iUE. show that in these is the bulk of our wealth and resources. And al- though trade, transportation, manufactures, banking and other indus- tries give employment to thousands of our citizens and furnish uses for millions of capital, still agriculture must for all time to come, remain the chief occupation of our people. Our soil of unsurpassed fertility, our geographical position midway between the rocky hills of New Eng- land and the arid plains and barren peaks of the Kocky Mountains, one the great manufacturing center, the other the home of the precious metals, Iowa with its wonderful grain, meat, fruit, and vegetable pro- ducing capacity, must forever largely hell) to feed the artisans and miners of the new as well as the old world. The assessed value of the improved and unimproved farming lands of Iowa for 1881, as shown by the auditor, is $241,968,396. The actual value of these lands, the real market value , is well known to be fully 40 per cent, more than the assessed value. This would give us as the true value of Iowa farm lands in rouod numbers, $338,000,000. When we add to this the true value of the live stock on the farms for the same year, estimated at $130,000,000, the fences, buildings, tools, and imple- ments, estimated at $220,000,000, we have a grand total of capital in- vested iu Iowa farm property amounting to $688,000,000. All other property of the State as reported to the auditor, including merchandise, railroads, banks, town lots, factories and their products, mining property, gold, silver, and greenbacks, household furniture, libraries, and newspapers, making a liberal allowance for low assess- ments, amounts to less than $150,000,000, or less than one-quarter of the value invested in agricultural lands, stock, and fixtures. According to that census we had, in 1880, 6,720 manufacturing estab- lishments employing 39,863 hands, with a capital of $31,409,470, working up $46,220,419 worth of raw material into $70,271,877 worth of pro- ducts. Ten years ago the total manufactured product was $46,534,322. Twenty years ago the product was $13,719,325. It will be seen by the above figures that the entire amount of capital employed in manufacturing in Iowa, after 20 years of the highest pro tection known in the history of our State, is less than one-twentieth of that employed in agriculture ; and that the number of persons employed in manufactures is but one-forty-sixth part of our population. I am not in favor of taxing the 1,585,000 of our citizens engaged in all other industries for the purpose of increasing the profits of 39,863 employed in manufacturing. Now, let us see how the present tariff affects our Iowa people. The only classes directly benefited by its protective features are the 13 percent, employed in mining and manufacturing and the few farmers who grow wool. First, let us see how the tariff has affected Iowa wool-growers. In 1867 we had in this State 1,354,608 sheep. In 1881, after a period of fifteen years of our greatest gain in population, wealth, and productive capacity, with a climate and soil particularly adapted to sheep-raising and wool-growing, we are humiliated to learn that our flocks had dwindled down to 436,561 head — a loss of 918,077 in fifteen years — an average loss to the State of more than 60,000 a year. Estimating the average value of sheep at $3 per head, our State has suffered a loss of $2,754,231 since 1867 in the partial destruction of our flocks during that period ; while our population has increased more than half a million, and the live stock of other classes had made an average increase of more than 160 per cent. Every thoughtful person will inquire why it is that in a State as well adapted to sheep-raising and wool-growing as to the pro- B. F. GUE.] REDUCTION OF DUTIES 1151 duction of horses, cattle, and swine, these latter industries flourish in a most remarkable degree, while wool-growing has declined, until at the last enumeration the total value of sheep had dwindled down to one-quarter of what it was fifteen years before. We find by examina- tiou of our tariff legislation that in 1867 (the very year when wool grow- ing in Iowa had reached its greatest production) the wool-growers and woolen manufacturers of the country, or a portion of them, came to the conclusion that some more tariff would greatly increase the pros- perity of their respective interests ; and Congress at that time, being in the same way of thinking, increased, at the request of the representa- tives of these two branches of domestic industry, the duties on the im- portation of wool and woolens to a degree unprecedented in our former tariff experience ; the duties on wool, other than cheap carpet wools, rang- ing from 37 to 110 percent., and on woolens from 40 to 150 per cent, and upwards, the heaviest duties being imposed on the cheapest woolens, adapted to meet the wants of the poor, and the lightest on the more expensive fabrics demanded by the rich. That tariff has now been in operation fifteen years, and we have seen in the above figures from official sources how disastrous its effects have been on Iowa wool-grow- ers. David A. Wells, who was Commissioner of Internal Be venue under President Lincoln, says of its effects upon the country at large : 1. The American wool grower has received on the average during this period a smaller price for his product than under the low tariff of 1857, when wools costing less than 20 cents per pound were admitted free of duty, and all wools costing above that paid but 24 per cent, ad valorem. In fact, for extended periods under the exist- ing tariff, American wools have touched lower prices than ha ve ever been experienced since the woolen manufacture of the country generally ceased to be a household in- dustry ; the wools receiving the least protection commanding the highest prices. 2. The number of sheep owned anil quantity of wool produced east of the Rocky Mountains has largely and continually diminished. 3. The business of manufacturing woolens in the United States under the existing tariff has paid a smaller percentage of profit on the capital invested than any other leading branch of domestic industry. 4. The American people, during the same period, have paid higher prices for their woolen clothing than the people of any other nation, their compeers in wealth and civilization. 5. In place of the existing tariff rendering the country more independent of foreign nations in respect to its supply of wool and woolens (as it was confidently affirmed it would be), the exact reverse has occurred, the importation of foreign wools during the year 1880 having been in excess of 128,000,000 pounds, as compared with 24,000,000 pounds in 1868 and 48,000,000 in 1878; while during the same year (1880) the United States bought of foreign countries manufactured products of wool to the value of $33,613,000. On the other hand, the United States sold during this same year to for- eign countries wool of domestic production to the extent of only 191,551 pounds, and manufactures of wool to the value of only $216,576 ! Now let us see who in Iowa has been benefited by this disastrous at- tempt to protect the woolen industry. Has it been the owners of Iowa woolen mills'? By turning to the official records we find that in 1867, when this increase of tariff duties on wool was made, we had in Iowa 89 woolen factories. After fifteen years of protection, with our immense increase in wealth and x>opula- tion, we find but forty of these factories in existence, the other 49 hav- ing disappeared with the 918,000 sheep that were during the same period protected out of existence in one State. On cattle, swine, and horses, rye, oats, and corn, butter, hay, and beef, wherein protection cuts no figure, as we can produce them cheaper than any other nation on earth, our State has made enormous gains, showing that farmers have suc- ceeded far better with the products undisturbed by protection than with the solitary one that Congress sought to protect for them. If our wool growers and manufacturers are not benefited by the 1152 TARIFF COMMISSION. [B. f. gue. tariff, wlio in the West is? I have consulted many manufacturers of iron products and have yet to find one in the West who shows that tariff protection is of any benefit to him. In our city we have several firms manufacturing barb wire and farm implements. Upon inquiry at one of the largest of these factories, owned by Given & Carpenter, they informed me that they derive no benefit from protective duties, as they simply tax the increased cost of the material up to the purchaser of their implements. D. B. Buford, of Bock Island, one of the most extensive and success- ful plow makers in the world, says : There is not one article that we make, or one interest of ours in the world, that is in the least degree benefited by the tariff. On the contrary, almost everything that we buy is enhanced in value by the present tariff, and of course our customers, in turn, have to pay more for what they buy of us. Almost every manufacturer in the West labors under this disadvantage. We ship large amounts of our products abroad where they have to compete with foreign makers. Here the disadvantage is even more severely felt. In New Zeland, where we are now shipping our goods, we come into direct competition with makers who are not hampered with these duties. We formerly did a remunerative business in Manitoba, but the Canadian Government has stopped that by placing a retaliating duty upon our products. Elsewhere we are compelled to enter the field and fight, hampered by increased cost of materials caused by the duties upon iron and steel. Every consumer has to ultimately pay the enhanced cost simply as a bonus for something called protection. The country would be better off without it. Mr. Lucius Wells, formerly manager of Deere & Co., Moline, 111., who made 97,900 plows in 1881, says that the cost of every implement turned out by this house is enhanced from 15 to 25 per cent, by the present tariff, with no compensating benefit. Charles E. Bussell, of Davenport, says : In 1870 there were within the borders or Iowa fifty-five establishments engaged in the manufacture of agricultural implements. If there be any industry in the world which ought to flourish in Iowa it is the making of agricultural machinery. That in- dustry has been “ protected” by a duty of 30 per cent. In 1880, the census shows that we still have in this State fifty-five implement makers, as in 1870. But looking a little further we find even more instructive facts. In 1870 these implement factories paid $182,138 in wages to 552 hands, or an average of $328 a year to each employ^. In 1880 they paid $235,380 to 663 hands, or an average of $236 to each employ 6. In 1870 there were 545 establishments engaged in the manufacture of lumber, em- ploying 3,563 hands, and paying $1,666,214 in wages, or an average of $467 to each employ A In 1880, under the operations of a so-called protective duty of $3 a thousand feet, the number of establishments had sunk to 321, paying $905,962 to 5,747 employes, or an average of $171 a year to each employ A Thus, in the West, no one discovered yet appears to be benefited by so-called protection. But if no benefit has accrued to Iowa factories or farmers from the high tariff' of 18G1 and 1867, how has it affected farmers in other respects ? It is estimated that the farmers of Iowa buy annually for use on their farms 25,000 plows. We learn from Given & Carpenter, plow makers of this city, that in the iron-beam plows there is used 58 pounds of steel, the duty on which is 2J cents a pound, making the tax on each plow $1.30. On a sulky plow the tariff tax is $1.37. The tax on a hay rake would be $1.10, and so on through the whole list of farm implements. On the 25,000 plows purchased annually by Iowa farmers the aggregate tax would be about $27,000. When we add a proportionate tax to every article of farm implements in which steel is used, we find the annual tax on Iowa farmers is a very large sum. When we add to these taxes the tariff duties of 95 per cent, on our ilannel goods, 57 per cent, on our coats, 95 per cent, on hats, 45 per cent, on our towels, 50 per cent, on our dishes, 35 per cent, on knives and B. F. GUE.J KEDUCTION OF DUTIES. 1153 forks, 68 per cent, on sugar, 69 per cent, on salt, 59 per cent, on glass, 25 per cent, on harness, 25 per cent, on books, 57 per cent, on carpets, 100 per cent, on blankets, 20 per cent, on lumber, 40 per cent, on fence wire, and similar taxes on scores of other necessaries of life used by every family in Iowa, the aggregate tariff taxation becomes immense. While these tariff bills were pending, our late distinguished Senator, Hon. James W. Grimes, in a speech in the Senate of the United States, made a vigorous fight for his constituents, in which he said: I will not consent to tax the farmers of my State upon the iron they use, for the benefit of Pennsylvania, and upon their jack-knives for the benefit of Connecticut and Massachusetts, and upon their woolens for the benefit of New England, and then add to that a tax upon tea and coffee and sugar, the necessaries of every man’s house. I am in favor of a revenue tariff. That is legitimate and proper; but the moment the government undertakes to go beyond that, and take money from my pocket, or take the profit of my labor, for the benefit of the Senator from Vermont, that moment the gov- ernment transcends its obligation audits duty. After the passage of the bill, our great Senator, in a letter to a friend, used the following language : You may rely on the truth of what I say when I tell you that there were not three men in the Senate whose honest convictions were for the bill. They voted for it by a sort of coercion ; one because wool was in it, another because iron was in it, and another because a drawback on ship materials, &c., but all condemning it as an en- tirety. No such combinations were ever formed before to secure the passage of a bill. Large sums of money were raised by the parties interested, and used as you can well imagine how. . If there is anything I try to stand up for on all occasions, it is fair play, and I con- fess I was irritated when I saw all these combinations to put money in the pockets of the manufacturers at the expense of the consumers, who are not here. As the bill stands it would increase the cost of all of the necessaries of life, except food, 50 per cent. Salt is raised by the bill from 176 to 240 per cent, ad valorem, jeans 100 per cent., steel 100 per cent., machinery 70 per cent. On top of all this, silks 65 per cent., and blank- ets, necessary to keep us warm, 144 — comforts of the most expensive description, such as the rich only buy, 50 per cent., and poor comforts, for the poorer people, 90 per cent. Lumber to build a house to shelter a family or to fence a field, $2 per M, whilst ship- timber, spars, cordage, iron, and copper, for vessels propelled by sail, are free. I cannot, in justice to the people I in part represent, refrain from de- manding that these heavy war taxes shall be reduced. The government does not need the proceeds of such oppressive taxation. We learn from official sources that the revenue derived from last year’s taxes will ex- ceed the legitimate requirements of the government by more than $150,000,000, and this after having created 1,500 new offices and clerk- ships, with aggregate salaries of more than $2,000,000 annually, having appropriated nearly $19,000,000 for improving rivers, harbors, creeks, fish-ponds, and digging canals which will be frozen over just when the crops are ready to be moved, and other unnecessary appropriations. Why should not the heavy taxes on the necessaries of life be reduced to the full amount of this $150,000,000 of surplus revenue? We do not want a dollar of tax taken off banks, patent medicines, perfumery, whisky, or tobacco ; the users of these luxuries can well afford to pay them. But in behalf of more than a million and a half of laboring men of moderate means in Iowa, who cannot afford to support stockholders of wealthy corporations at Saratoga in the summer, and at Paris in the winter, I ask you, gentlemen of the Commission, to recommend a sweep- ing reduction of tariff taxes on all the necessaries of life that are now taxed. The farmers, mechanics, merchants, and laboring men and women of the West ask for no government aid in tariffs or subsidies to help them make money. Our industrious, enterprising, hardy, and self-reliant peo- H. Mis. 6 73 1154 TARIFF COMMISSION. [B. F. GUE. pie are abundantly able to support themselves and pay their own way, and out of their boundless energy and resources they will cheerfully pay their full and just share of all legitimate expenses of their National Gov- ernment without complaint. But when the stockholders of New Eng- land cotton mills, woolen factories, carpet and cutlery establishments, or of the iron and rolling mills of Pennsylvania, or the wood-pulp mills or salt wells of New York, or the lumber regions of Michigan, or the sugar mills of Louisiana ask the government to levy a tax upon the moderate earnings of our farmers to add to their dividends money never earned, we firmly and emphatically protest. The business that must be supported by the taxation of laboring men, or sustained by subsidies forced out of unwilling tax-payers, ought to fail, and the cor- poration that has not the ability to succeed with healthy competition ought not to exist. The pension-roll is already large enough without adding the great army of manufacturers to it. The healthy doctrine of the u survival of the fittest’ 7 may just as well be applied to iron, cotton, and wood-pulp manufacturers as to the uncivilized races and newspa- pers. We have had too many subsidies for a true Republican government already. Railroads have under that policy absorbed millions of acres of the people’s public lands; steamships have taken theirs in cash; rivers and harbors, creeks and cranberry marshes have claimed their share; iron mills and shoddy mills, Woolen mill sand cotton mills, starch mills and quinine mills are all clamoring for subsidies.” Where it will end, no man can tell. In the name of common honesty, in the cause of justice and equal rights, we ask you, gentlemen of the Commission, to recommend a reform in which this odious practice of robbing one citi- zen to enrich another may be at once and forever ended. In the views I have here expressed, I believe 1 represent the senti- ment and desires of more than three-quarters of the farmers of Iowa. By Commissioner Boteler : Question. In West Virginia the number of sheep has increased, and the wool interest has become quite important. In correspondence with prominent men of the sheep industry, they urge me to try to prevent any reduction of the duty on wool, saying that it would be utterly ruinous to their now growing interest. From the figures you present, I do not think that the world’s history will show greater prosperity in so short a time than in this State of Iowa % — Answer. We think so. Q. That has grown up under this present tariff almost entirely, has it not ? — A. But you will recollect that where this greatest increase in prosperity has been is where we get no possible benefit from the tariff, because it is where we can produce cheaper products than in any other part of the globe. Q. That is a matter of opinion. Notwithstanding this tariff, this State has grown and her prosperity is marvelous. — A. Yes ; I will adopt that u notwithstanding the tariff.” Q. Is it not a fair inference that the tariff has had something to do with this prosperity % — A. One of the greatest factors in our prosperity has been the agricultural products, which the tariff has not affected ; while upon w r ool, which has been affected, the tariff has been most dis- astrous. Q. In levying a tariff for revenue, you do not believe it is right or proper to afford such incidental protection as would give encouragement to an industry % — A. Any tariff is protection, so far as the amount of the tariff on that article is concerned. I believe that a fairly adjusted revenue tariff, reduced down to a sufficient amount on the necessaries B. F. GUE>. 1 REDUCTION OF DUTIES. 1155 of life and luxuries to give us a sufficient revenue to pay the interest on the public debt and reduce it as fast as it becomes due, and to pay all legitimate expenses of the government, would be submitted to cheerfully by every citizen of the West. Q. In laying that tariff for revenue (to enable the government to pay its debts, and all that), do you, or do you not, think that it is the duty of the gentlemen who make the laws to discriminate, wherever they have the opportunity to do so, in favor of American industries as against those of other countries ? In other words, do you not think that the American legislators should legislate for Americans and not for for- eigners ; that they should not permit the American citizens to be de- pendent upon foreigners in any contingency possibly ? — A. You have asked several questions. I will take them up as I remember them. As 1 say, any tariff is a protective tariff to a certain extent ; to the amount of the increased cost of the article over and above the cost of a foreign article, freight taken out. I think that is a fair proposition. I have no objection to that kind of a tariff ; I am in favor of it. By Commissioner Ambler : Q. Do I understand you to say in that statement that the entire amount of duty levied from time to time goes to enhance the price of an article ? — A. I have not given you any such statement. Q. You gave, for instance, on plow steel 2J cents a pound as the tax. — A. Yes ; I gave that as given to me by manufacturers in this .city. Q. You figured out from that that there was $27,000 of additional cost to plows by reason of that 2^ cents. Is that $27,000 the precise amount, or is it stated approximately? — A. It is just about the precise amount. I give the statement of Given & Carpenter as to the fact. Q. Do you think it is the fact that the cost is increased by the amount of the tariff? — A. I have no means of knowing, as I am not a manu- facturer. Q. I mean generally ? — A. I have no means of knowing. Q. One of the most protected articles in this country is steel rails, I believe, is it not ? — A. I think that was discussed yesterday pretty fully, and that statement I believe was made. Q. Do you know what the present price of English steel rails is ? — A. I do not. Q. We were assured by Mr. Abram S. Hewitt, who is, I think, good authority, that it was $28 a ton. — A. Let me suggest to the Commission that I am willing to answer any questions that I can; but I understand that the object of calling witnesses here is to get what they know about a matter, and not to present to them arguments on the part of the Commission. Am I correct? Commissioner Ambler. It is with reference to the particular thing, as I understood you a moment ago. The Witness. Was not that all discussed yesterday fully? Commissioner Ambler. No, sir. The subject I am upon now was not referred to yesterday. The Witness. Then I would suggest that you refer to British statis- tics to get those facts, as they are much more reliable than I can give. If I had them I would give them to you willingly. Don’t you think that is fair ? Commissioner Ambler. Yes; it is quite fair. You speak as to salt. That is one of the things you enumerated. 1156 TARIFF COMMISSION. (b. f. gue. The Witness. I gave the statement of Senator Grimes in his speech in Congress. Q. It may have been true then, and it may be true now. You would hardly deny that it is a fact that home competition has reduced the price of salt so that it is less than it was before the passage of this tariff act, and less than the foreign price?— A. You are talking upon a subject that I am not posted upon, so far as foreign prices are concerned. Commissioner Ambler. I understood your suggestion to be that that is one of the things you are heavily taxed upon, and I happen to think differently. The Witness. There is a high tariff* on salt, is there not ? Commissioner Ambler. Eight cents a hundred. The Witness. What is it for, if it is not for protection ? Commissioner Ambler. It is undoubtedly for protection and for rev- enue. The point I want to get at is as to whether there is not a cheap- ening by increasing competition at home ? The Witness. I think there is. Q. I am not saying that what we have now is proper protection, but the effect of proper protection is to enhance the price in the first in- stance. — A. I understand that it is. I understand that the object of pro- tection is to enable our manufacturers to charge more for an article than they could if it came in competition with others ; that is, to give them a monopoly of the business against foreign competition. Q. That is, to give to those who choose to go into the business in this country a monopoly against foreign competition. — A. Yes. Q. That being true, primarily, it stimulates production in this coun- try on the particular thing, assuming that it is a thing that we may properly produce here. — A. I should think so. Q. And then comes the other end of the proposition, that is to say, that home competition has a tendency to reduce the prices ; is that a fact ? — A. Yes, if the competition is lively enough. Q. It gets lively enough if the subject of it can be profitably pro- duced in the country, and protection is ample. — A. It does, except the producers make a combination, as they generally do, to keep up the prices. Q. As I understand your argument, the effect of it is that the entire tendency of the tariff for all time is to enhance the prices ? — A. Yes, sir. Q. There is, as I suppose you know, a different school of politics or- ganized, who think that in the end it compensates by increasing and stimulating industry. — A. Yes ; I have read that argument. The JSTew York Tribune is of that opinion, and I have read it for thirty years. When I first began to read it the argument was this, and this almost entirely : That we only want protection for our industries w T hile they are in their infancy and are not able to compete with Great Britain. I have been watching to see when those infant industries would be willing to run alone ; not simply able, but willing to run alone. I haven’t yet seen one of them that has reached that period where it is willing to run alone without protection. Q. That may be the case, but let us go one step further. Is it a fact that, generally, so far as articles covered by this tariff are concerned, since its enactment there has been a great decrease in prices ? — A. I think that there has been a great fluctuation in prices. Q. Is it a fact that, generally speaking, it has resulted in a decrease? • — A. On some productions. Q. Is it your opinion that it is general ? — A. 1 am not well enough REDUCTION OF DUTIES. b. p . oute.l 115 ? posted in all the industries of the country to say whether it has been or not. I think it has been in some. Q. Taking the entire scope of the country, is it certain that there would be the same general reduction if the tariff had not been passed? — A. No one could tell what would have happened under another state of affairs. Q. And for that reason we are still in the realm of argument upon the subject. — A. I admit it. Q. Is it your judgment that there ought to be a radical reduction of the tariff* generally at this time? — A. That is my opinion. Q. Have you to such an extent dwelt upon the subject that you could give us your idea as to what that reduction should be? — A. No, I can- not; I am not an expert in the tariff*. Q. Is it your judgment that there ought to be a tariff* upon manu factored articles sufficient to compensate for the difference between the w^ages of other countries and the wages of this? — A. That is a question that would lead to a long argument, because it would be necessary to discuss the whole ground. Q. I just wanted to know the extent to which you and other gentle- men representing this Iowa Free-Trade League would go. — A. No, sir; I represent the farmers of Iowa, and not the Free-Trade l eague. I publish the only weekly agricultural paper in the State. Q. I want to get your ideas as a representative man upon the sub- ject, if* you can give them ; but, if you do not feel willing to give an ’opinion upon the subject, of course I will not press it. — A. When we come to the intricacies of the tariff*, I do not consider myself competent to discuss them, because it is a fearfully and wonderfully made docu- ment, one that I have never been able to understand, and I have never seen two protectionists who agreed upon it. By Commissioner Underwood : Q. The tariff on calico is cents a square yard, and upon other cot- ton goods, such as pillow-casing, sheetings, &c., it is about the same. You can buy calico to-day in the city of New York for 3£ or 4 cents. Has not the protection on that class of goods reduced the price by stim- ulating competition in this country? — A. That is probably a subject upon which there would be a wide difference of opinion, and it would take perhaps a week for us to go over the whole ground of discussion. You gentlemen have your decided views upon that question, and I am not here to controvert them, other than by presenting my views. Q. You ought to know about calico matters. The Witness. In what respect? Commissioner Underwood. You should know the tariff and the prices. The Witness. I think there are hundreds of articles enumerated in the tariff act, the figures of which I could not keep in my head. But you gentlemen have those figures before you, without getting my evi- dence. Q. Did you ever know calico and bleached goods as cheap as they are now ? — A. I never did. By Commissioner Oliver : Q. Your statement in regard to the decrease of the wool growing in Iowa is an extraordinary one. I cannot understand, with a duty of 10 cents a pound put upon an article, and the home market limited, why the Iowa farmer should quit wool growing. I would like to ask if there is not some other reason. — A. I am not able to answer that question. 1158 TARIFF COMMISSION. fB. F. OUf.. When I first came to the State I engaged in wool growing. That was in 1852. I sold my wool that year in Chicago at 40 cents a pound. I think that is much higher than the average price of wool has been since; but I was not able to make the business as profitable as I wished, and 1 abandoned it after a few years. Other people have continued in the business; but a great majority of those who were in the business have abandoned it, as shown by the census. I w r as as much surprised as any one in reading those facts, although I was aware that there had been an immense falling off in sheep raising and w 7 ool in this country. Q. Your statement is really an extraordinary one. There is no ques- tion as to its being correct, and for that reason I wanted to know if there was not some other cause for it than the effect of the tariff*. In the county adjoining where I live, which was a great wool-growing county, they introduced mining, and dogs came along with that class of popula- tion, and the sheep were gradually lessened in eight or ten years. Is there any such reason in Iowa ? — A. I can give you the history of the dog law. I happened to be a member of the legislature when that ques- tion was prominently before it for a number of years. From 1852, the time I came to the State, up to 1862, the dog law was just what it is to-day. In 1862 we passed a stringent dog law for protecting sheep. But as the owners of dogs were in a very large majority over the own- ers of sheep, they brought pressure enough to bear upon the extra ses- sion of the legislature — which was held for the purpose of raising men and money to carry on the war — to repeal that law before it had been in operation six months. With the exception of that six months, when that law was in operation, we have had precisely the same dog law — the same encouragement of dogs from 1852 to 1882 — and it is this : We protect dogs by a protective tariff*. Of course it is not a general protective tariff*, but a State protective tariff. We discriminate against sheep by taxing all our sheep in the hands of farmers, or wherever they can be found, while all dogs we exempt from taxation. Q. Is it not a fact that the farmers of Iowa had about that time a great wool-growing craze; that they thought the country was better adapted for wool than anything else ; and that afterwards they quit raising sheep and turned their attention to wheat, and then again after- wards found that Iowa was better fitted for corn and grazing f — A. I was farming all those years. The diminution of sheep was a gradual process. It had reached its highest point in 1866 and 1867. In 1865 there were a great many sheep, and there were a great many for ten years after that, probably; but in 1867, without any cause that I can see except the tariff, there came the turning point. How the tariff affected it I am unable to say, but in that very year it was a fact, as shown by the records, that our sheep interest began to decline, and con- tinued to decline until about three years ago. Since then it has been gaining slightly. The lowest point was reached three years ago, l think. Q. You speak of representing a million and a half of laboring men. One of the gentlemen who has appeared before us here stated that the laborer in this country was paid from $1.75 to $3 a day. Is that about your view? — A. That, I think, is the wages generally paid in towns and in factories, that is, $1.75 for unskilled labor. In the country farmers have hired their help for several years on an average of about $18 to $20 a month, with board, which would perhaps amount to $12 more. But there is this difference: the farmer’s help is paid for rainy days and all, and day laborers are only paid for the time they actually work. Q. Ho you know about the rate of wages paid in Germany and in England ? There is a large emigration from those countries. — A. I have n. F. frUE.] REDUCTION OF DUTIES. 1159 read such conflicting statements in regard to that from the different ad- vocates of free trade and of a protective tariff tMt the only way to come at that is to refer to the official statistics, and 1 haven’t those before me. In giving testimony before this body I do not like to guess at it. Q. We want the expression of the views of the people of this section particularly, and therefore that is the reason I desire to ask you the question as to whether the men who labor in this section of the country would advocate such changes in the present tariff laws as would reduce the rate paid for labor in this country and increase it abroad, because that would be the natural turn of affairs if our trade was turned over there. The wages would rise there and be reduced here until an equilibrium would be established between the two. Now, are your peo- ple fully prepared for that ? — A. You have stated a theory that is dis- puted by some, and upon that theory I am not prepared to say in how much of it you are absolutely correct, and in how much of it there may be some honest difference of opinion. It would involve the discussion of the entire tariff question, and I think we haven’t time to go into that to-day. By Commissioner Underwood : Q. Would you advise us to take the official statements? — A. I would, certainly; but I do not suppose you need that advice from me. Q. I wanted to know whether you had confidence in them. — A. I cer- tainly have; I have confidence in all facts. By the President : Q. You state the fact of the decline in sheep husbandry in Iowa as a proof of the malign influence of a protective tariff* upon that. — A. Per- haps I would not make as unqualified a statement as that. Q. That inference is drawn from the tenor of your statement. — A. That is an inference due to the fact, but I do not say that it is due alone to that. Q. With your statement of the fact of the decline of sheep husbandry in Iowa I entirely agree. I also state that the fact is the same in Ohio and many other leading States. I also agree with you that the decline commenced about 1807. Are you not aware that there has been a transference of the sheep husbandry from those States into other re- gions? — A. There has been a great increase in the sheep-keeping in- dustry in some of the extreme Western States within the past three or four years. Q. And that has come from a transference of the flocks from Ohio, Illinois, and other States into the States of Colorado and Texas. — A. There has been such a change. Q. And, of course, to accomplish that transference there has been a sale of sheep, and, consequently, a loss of sheep in those States; but that loss of sheep to those States has not been so great a calamity, after all. — A. So far as I recollect, in relation to this sheep industry, it has grown up in those Western States within the past five years largely. It does not extend back anywhere near to 1867. Q. Are you aware that there are now in this country something like 51.000. 000 sheep, as shown by the census ? — A. I haven’t seen the census of 1880. Q. And are you aware that in 1860 there was produced nearly 60,000,000 pounds of wool, according to the census returns, and that on the same rate of increase for the present year the production would be very nearly 3.000. 000.000 ? — A. I haven’t seen these statements. We have been very much provoked at the delay in receiving the census returns. 1160 TARIFF COMMISSION. fl?. F. OFF. Q. You speak of a decrease having takeu place in 18G7. Are you aware that in 1866, or about that time, there was an enormous falling off in the demand for woolen goods, owing to the end of the war ; that the previous demand for woolen goods had tended to stimulate sheep industry in the southern hemisphere ; that upon the restoration of cotton culture in the South there was an immediate throwing back upon the world of the whole of the wool products, and that there were enormous importations of wool from the southern hemisphere into the United States ? — A. So I have understood. Q. Are you not aware that that unprecedented increase had a de- moralizing effect upon sheep husbandry ? — A. It certainly had upon the price of wool. Q. Are you not aware that the law of 1867 was made upon solicita- tion to arrest such au effect as that ? — A. I stated that it was made at the request of sheep farmers and wool manufacturers. By Commissioner McMahon : Q. When you speak of hats being taxed 90 per cent., do you refer to wool hats ? — A. I cannot tell you just the figures. I got that statement from a publication, and I submitted it to a gentleman to compare it with the tariff list, and he said it was substantially correct ; but there are so many grades of cloth of which coats are made, and so many grades of hats and various articles, that one sum will not represent a fair average of the protective duties. Q. I will say, for your information, that 95 per cent, is the duty on wool hats. You say 100 per cent, on blankets ; that is, of course, wool blankets ? — A. I suppose so. Q. You say in your printed direct statement, “ Now, let us see how the present tariff affects our Iowa people. The only classes directly benefited by its protective features are the 13 per cent, employed in mining and manufacturing and the few farmers who grow wool.” — A. In setting that up they have omitted the words “it is claimed,” and in the hurry I did not stop to correct it. It should read, “ It is claimed that the only classes directly benefited,” &c. I am not able to say how they are; but a good many protectionists do claim that. I make that explanation in justice to myself and you. Q. I find by the official records that the total importation of wool blankets in 1879 was something over $1,400 worth, in 1880 something- over $1,200 worth, in 1881 $1,954 worth — practically no importation at all of wool blankets. Now, do I understand you that the farmer of Iowa who uses a domestic blanket is taxed 100 per cent, on that? — A. He is ; the manufacturer takes advantage of it and raises his prices to correspond. Q. I do not know what you mean by that. — A. Suppose you are a woolen manufacturer, and there is a tariff put upon blankets for your protection. You are very likely, no matter what the cost may be, to take advantage of that protection, and charge me, if I want to buy it, just as much as you can under that tariff protection. Q. Unless I am something more than human, am I not pretty sure to do it ? — A. You are sure to do it. Q. Especially when there are substantially no importations of the kind ? — A. Yes. If you get the tariff so nearly prohibitory that it pre- vents competition entirely, then, of course, you and your companions have a very great advantage of us who are using them, and you can put your price up to correspond with the actual value that the government has legislated into your hands. reduction of DUTIES. 1161 Q. Whatever be the cause, if there is practically no importation, then there is no competition ; it is a home competition ? — A. No. Q. Then, in all human probability, the manufacturer and the producer will get the advantage of that extra tax 0 ?-— A. The manufacturer; not the producer. Q. I understand .you that, if there be a certain kind of iron ore pro- duced here, and there is no importation of that kind of iron ore, the producer taxes the farmer just so much when it enters into his agri- cultural implements ? — A. I think it does, if the tariff allows him to ; I think he would be very likely to do it. I think that is what the tariff is for. Of course, a deduction would be made of the freight that it would cost to bring it over from foreign countries. Q. The farmer is not protected ? — A. It is claimed that he is protected in the wool business ; but 1 haven’t been able to see it. Q. The fact remains that the prices have gone down on these very articles of hats, blankets, &c. — A. I am glad to hear it. 1 have not discovered it in purchasing. Probably our merchants don’t give us the benefit of it. Q. What I want to get at is just this, that the tariff imposes a duty of 20 cents on wheat, 1 cent a pound on beef and pork, 2 cents on hams and bacon, and 4 cents on cheese, and so on. You say that that is no protection at all ? : — A*. Nq benefit to us here in the Mississippi Valley. If we have to pay it, it is a burden to us. Q. The consumer who uses the wheat, corn, and barley does not have to pay any tax ? — A. If he uses it in this country he does not. We are very heavy exporters of these products I have mentioned, while the woolen goods and the cotton goods are not produced to any great ex- tent in our country. We have to buy them from other places. Q. I have just shown you that not $4,000 worth of blankets were im- ported in three years. We imported 12,000 bushels of wheat in 1870, 39,000 in 1880, and 10,000 in 1881. — A. That does not affect us here, because we have an immense surplus here to send out of the country. Q. This is a fair comparison of the wheat import and export between the manufacture and importation of these manufactured articles. — A. It is a question of locality. By the President : Q. Do you suppose that the competition between 500 woolen mills of this country, where blankets can be made with ease and facility, does not decrease prices ? — A. If there was no combination. Q. Do you think it possible that there can be a combination, since they are so scattered? — A. I think it is very possible. It seems that they have an association of producers of pig iron, which lately held a meeting somewhere in the East, and they proposed to control the price of that product. In their meeting they would not admit any one unless he was a producer of pig iron, and they were universally in favor of adding $2 a ton to the duty. If that recommendation is followed, we would have to pay that. The men interested in making these arti- cles are generally the men who are interested in the sale of them, and they want bigger prices in the market. By Commissioner Boteler : Q. If it is wrong for those gentlemen to combine, is it right for these men here to form these leagues? — A. If they combine to take some- thing from their neighbors, it is wrong. It depends upon what the in- terests are. If they are illegitimate interests, and taxes are forced upon the Western people, then it is wrong. 1162 TARIFF COMMISSION. [JOHN B. ALLEY. JOHN B. ALLEY. Des Moines, Iowa, September 1G, 1882. Hon. John B. Alley, of Lynn, Mass., appeared before the Commis- sion by request, and made the following statement: Mr. President and Gentlemen : As you all know, the city of Lynn is proverbial for being at the head of the great manufacturing in- dustry of boots and shoes, particularly ladies’ shoes. Lynn has been distinguished as the shoemaking town of the country, 1 suppose, for more than one hundred years. The commencement of the shoe business there dates back something over one hundred and fifty years. It had progressed considerably at a very early period, when they imported a very celebrated shoemaker by the name of Dagger from England in 1750. He brought a great many apprentices with him, and consequently the business began to improve. It continued to improve gradually un- der the old colonial government. In 1783, at the conclusion of the Revo- lutionary war, the business was very much depressed, and it continued so depressed from that time to the adoption of the Constitution of the United States; and in fact until a protective tariff was enacted in 1791. A respectable man, who was largely instrumental in obtaining the pas- sage of this first protective tariff act — I believe it was the first — during Washington’s administration in 1791, or thereabouts, told me that from the conclusion of the Revolutionary war until the passage of that tariff act he worked for his board. He had to get his clothes the best way he could. In those days he said their living was very meager; they lived chiefly upon bean porridge and brown bread, and had meat once a week where he boarded. During those several years he worked con- tinuously for his board. A young man, perhaps I might say one of the most enterprising, one of the most talented and intellectual young men that Lynn ever produced — I say this from recollection of his own statement which I heard him make to my mother — said that in 1787 (the year the convention was sitting in Philadelphia) he went to Philadel- phia and went to work at shoemaking. He carried letters to a very distinguished quaker merchant, Mr. Zachariah Collins, of Philadelphia (who was a native of Lynn, and I believe brought up there, and had a great many relatives there), and spoke to him of the Lynn shoemakers; and, finally, Mr. Collins helped him to commence the shoe business on a large scale, for those times, in Philadelphia, obtaining his shoes from Lynn. After two or three years, finding that the business of Lynn was so depressed, and that after the war had closed great quantities of shoes were imported from England and Prance, though mostly from England, they found that the business could not be maintained with any degree of profit, as the foreign manufacturer was able to compete successfully with their productions. Mr. Collins, who was on intimate terms with leading members of Congress, told the young man that he would advise him to make an effort to get protection upon shoes, and thereby pro- mote the shoe interest. Lynn at that time had become noted through- out the country as being a great shoe town. I remember reading a let- ter, written by General Washington, stating that in his tour through New England in the fall of 1789 he found Lynn the great shoe town of the country. So that you see one hundred years ago it was regarded as JOHN B. ALLEY. J BOOTS AND SHOES. 1163 the great shoe place of the country. Mr. Breed was the name of the young man. He suggested to Mr. Collins that, as he (Mr. Collins) was on intimate terms with leading men, and a gentleman of wealth and en- tertaining finely, lie would like to have him invite some of the leading members of Congress to talk over this matter at dinner, and have him there. This Mr. Collins did. 1 remember him telling this to me, and among others, Mr. Madison, subsequently President of the United States, who at that time was engaged to a young quaker girl in Phila- delphia — Dolly Madison, as she is known in history — and whom he after- wards married. This young girl (afterwards Dolly Madison) was a friend of this young Breed, and also a friend of the Collins family. Mr. Madison was invited to dinner. I do not remember who the other geusts were. So they talked it over, and Mr. Madison said to Mr. Breed, u If you will get up a petition and have it signed numerously in the town of Lynn, and send it to the Massachusetts legislature, and the legislature will petition Congress for a tariff act sufficient to protet the shoe interests of the country, that will be the best course, and we will promise our influence in getting it through. So that course was pursued. This gentleman whom I first mentioned, one of the most in- telligent and respectable citizens of Lynn in after life — he was then a young man and particular friend of this Mr. Breed — told me the story; that he got a letter from Mr. Breed, and Mr. Breed related the circum- stances and inclosed a petition in due form, which he took around and got signed very numerously, and sent it to the legislature of Massa- chusetts, and that legislature petitioned Congress, and Congress en- acted the law. I rather think it was the first protective tariff law that was passed by Congress. You may, perhaps, know, Mr. President? The President. Yes; it was. Mr. Alley. That law was sufficiently protective to exclude all the common work from England and all other European countries ; and the consequence was that it gave an impetus to the trade of Lynn, and other shore towns grew up subsequently; but Lynn was the principal town. And they soon began to extend their traffic by sending their shoes to all parts of the country. So that nearly all the shoes that were con- sumed in three or four years after that in Philadelphia and in the adja- cent country, of ladies’ manufacture, were furnished exclusively from Lynn, and very little was made in Philadelphia at that time. Iu a few years the trade began to increase, not only in quantity, but also in quality, very much, until at the present day the boot and shoe and leather interest of this country exceeds altogether that of any other productive interest of the country. And now they are enabled by in- ventions in machinery and the progress of the arts in manufacturing to compete with the world, and very few shoes are imported. Some shoes are imported now of the very finest quality, and I suppose that would be the case no matter what tariff you should put on, because there are a great many fools in America, as well as in all other parts of the world, who think anything of foreign manufacture which they wear must be better, necessarily, as well as more stylish and fashionable. Conse- quently, there are shoes and boots imported from France and England to-day ; not many from England, hut some few from France. But so far as the general manufacture of shoes is concerned, they can manu- facture as cheaply in Lynn, and do manufacture better goods than they do on the other side, altogether superior to England. Now, in regard to the manufacture of leather : We have got so within a few years that we are able to export leather extensively to all the coun- tries of Europe, and we can compete with the world in the manufacture 1164 Tariff commission. [JOHN B. ALLEY. of leather, with the exception of some portions of upper leather, such as goat skins and manufactured morocco. Some of the finer qualities are still imported from abroad, and some of the finer qualities of calf skin are imported. The calf skin and goat skin interest has actually been terribly depressed in consequence of importations. The ordinary leather or the sole-leather we can manufacture better and cheaper, and we now send large quantities of leather abroad to nearly all the European coun- tries — Germany, England, France, and Switzerland. I am a manufac- turer of sole-leather. My house is in Boston. I am also a manufacturer of upper leather, splits, and boot leather, and that class of goods. We send a great deal of it now to Liverpool, and from there it is sent to various other countries in Europe, and they are beginning to cry out about it now very loudly. I saw something some time ago that was written by Bismarck about it, suggesting that some action ought to be taken by the German Government to prevent this vast importation of leather. I think Bismarck rather favored protection, though he was not very strong upon it. That, Mr. President and gentlemen, is the history of the shoe inter- est, as I understand it. I presume there is no one living at the present time who remembers all about the passage of that act and what occa- sioned it; and I only remember it from having lived quite a long period, some sixty-five years, and from the fact that this Mr. Breed was an in- timate friend of our family, and I heard him talk it over with my mother. Being a boy, I remembered it. Most of our family ha ve passed away, but I am left to tell this story, Mr. President. By the President : Question. Can you tell me whether it is understood or generally known that the women and children of America are the best shod of any people in the world? — Answer. That is said to be the case. We probably manufacture better shoes — that is my judgment about it — than are made in Europe. I have been in Europe a number of times, and of course naturally felt interested in looking after other manufacturers in my line, and my judgment is that we, as a people, are better shod. I forgot to mention one fact: The shoe interest, from 1791, perhaps for fifty years, really needed protection, and grew up under a protective tariff ; and I regard its present condition and prosperity in every respect ascribable in a very great degree to the fact that a protective tariff has been in operation for the most of the time for the first fifty years of the government. W. W. WHITMEfi.] FREE TRADE. 1165 W. W. WITMER. Des Moines, Iowa, September 16 , 1882 . Mr. W. W. Witmer, of Des Moines, manufacturer of brass patented articles, addressed the Commission as follows : Mr. President and Gentlemen of the Commission : I am one ol the members of a committee appointed by our Iowa Free Trade League. 1 was requested to make a statement here, and I want to apologize in- formally in the beginning for not having statistics, for just one reason, that we determined at too late a day to appear before the Commission. So that to make a complete argument and use figures, it was entirely too late. But I want to state what I believe to be the views, not only of the Free Trade League, but of many gentlemen, and particularly of many farmers in Iowa, and they would also apply to the West, as I think. In the beginning we undertook to call ourselves free traders. We dis- cussed the matter thoroughly, and we agreed that we would never apologize for calling ourselves free traders ; we are such, particularly as against protection. That is to say, if we had perfect equality or free trade, if there was no favor shown under the laws to one man as against another, then our views of free trade would be largely accomplished. We want liberty. We want the same opportunity for trade, for ex- change with Australia, Brazil, Germany, France, and England as we have with Pennsylvania and Massachusetts. In taking this position I am not unmindful of the fact that we are more nearly related to our friends in the East. I myself came from Pennsylvania and have friends and relatives there; but we cannot understand how, under our system of government, we should be taxed in any form for the benefit of friends and relatives in Pennsylvania or New England. That, I think, is the broad ground taken by the Iowa free traders. We believe that a purely revenue tariff means free trade. We do not demand that the custom house shall be abolished or burned down. We do not demand that duties shall at once cease on all articles of im- port. On the other hand, we are perfectly willing to support the gov- ernment by a duty on imports, so long as a policy looking toward free trade is inaugurated, and that to come just as soon as the government can stand it. Now, upon that point I want to refer to a topic that came up yester- day. What do we wish? what do we propose? I speak for myself, and I believe I speak the sentiments of our league not only, but those who are our friends, and I believe they are the large majority in this community. We believe that the internal -revenue tax should be main- tained in preference to any protective duty, matches possibly excepted. We believe next to that that the duties upon tobacco and all manufact- urers of tobacco and alcohol should be maintained, so as to make the tax upon the articles themselves equal, whether they come from foreign countries or from this country. Next to that, we believe that a low duty should be imposed upon coffee and tea. Next to that, we believe that there are a great many small articles of supplies which are dispensed with, particularly by the laboring classes. 1166 TARIFF COMMISSION. [W. W. W1TMER. They are dispensed with, with or without duty, aud they could bear a small duty. Next to that we could bear a tax upon wools, or manufactures of wool, because so long as there was no discrimination it would be regarded by us as not being a protective tariff. We believe that a list of twenty- five to thirty articles might be se- lected on which a duty might be imposed, which would furnish a suffi- cient revenue. Or the list might be increased, if necessary. Then we believe, next to that, that the expenses of the government, as they are known, should be reduced. A free trader, as I understand, necessarily looks for economy in all branches of the government. For illustration, the free traders, to a man, are opposed to the river and harbor bill, or anything that belongs to it — that is, the excesses of it. We recognize that some things in it are proper. We believe that the indebtedness of the government might be reduced more gradually than it is; that the revenue which is used now need not be so large by a very large percentage; and therefore that many protective duties at least could be removed. Then, after a number of years, taking the time given by my friend Mr. Philpott yesterday, whether it be a shorter or a longer time, when we reach a point where the necessities still exist for the imposition of duties upon imports, and we find that protective duties are necessary, rather than impose a duty for the purpose of protecting one man as against another, then I say personally, and I believe it to be the opinion of the farmers, particularly, the general masses, including the farmers and merchants alike in this section of the country, that they would rather submit to an income tax, and I believe it to be f&irer by far than a protective duty. Now, that much in general for the Free Trade League, and that is all. Specifically, I want to say that I am interested somewhat in real estate in the city of Des Moines. Last year I purchased an old hotel in the city. I made repairs upon it, amounting to about $10,000 or $12,000. It had to be refurnished, and I found some difficulty in getting a ten- ant, but the chief difficulty was in finding a man who had sufficient capital to furnish it. The house in past years had not been in excellent condition, and had no reputation to go on. I wanted nothing but a first-class man, and nothing but first-class furniture in the house. I finally found a man who furnished it and put into it about $10,000 to $12,000 worth of furniture. Now, without going into details, I want to say simply that if that furniture has cost more by reason of the duty which is levied upon the articles, it will be beyond really what I would wish to acknowledge for myself; but, making some considerable allow- ance, adopting methods and rules which I have been accustomed to adopt when engaged in newspaper work here, I think it is safe to say that that furniture cost the man who put it there at least $2,000 to $2,500 more than it ought to have cost, or than it would have cost if he had been at liberty to buy his furniture abroad and import it at the usual expense of freight, without paying the duty. The usual items, of course, are carpets, linen goods, table-ware, dishes, bedding, and the like; and, in fixing up, paint, oil, colors, &c. Now, adopt the same rule, say, for the house in which this Commission sits, and the expense would be about $5,000 for one complete outfit. The Commission may not have thought of it, but I have the testimony of gentlemen engaged in the business, and have made some inquiry for myself in regard to my own house, and 1 find that such articles as sheets, pillow-casing, towels, &c., must be renovated about once every year ; VV. W. WITMER.] FREE TRADE. 1167 carpets, about every three years ; dishes, about every six months ; and general bedding, about every five years ; and that will apply to the fur- niture ; plated ware, such as you find on the tables, probably about once every two or three years ; stoves, ranges, or furnaces, about every five years. Adopting a very liberal policy, it may be safe to say that the furniture in this house must be renewed every five years. If that be true, then this house, according to the rule which I have adopted, pays a tax in the shape of duty of $5,000 every five years. Now, take the four leading hotels in this city, and it will aggregate a sum of $12,500 to $15,000. If this is extravagant, make any reduction we please, it makes no difference as to the argument which I desire to draw from it ; but it is a tax with no benefits ; and with the most serious objection of all, that is, your host does not enjoy the pleasure of having a tax receipt. It is a tax equal to all the municipal, school, and State taxes which he has to pay during the same time; but for those he gets a receipt; for this he does not. That is the real objection to the pro- tective tariff upon imports. Now, we will concede, for the sake of the argument, that the duty does not go to the amount I have indicated ; but we still say that if it is any per cent, of that, there are no corresponding benefits. Somebody else is benefited. The host does not pay it at all; the guests pay. This Commission pays 25 to 50 cents a day more per man on account, not only of the furniture, but the help, shoes, hats, clothes, &c. There is just one other item to which I want to refer. About two years ago I was engaged in newspaper business, and a pressman in- vented a newspaper folder. Other gentlemen with myself undertook to engage in the manufacture of it. Last year we purchased a small foundry, machinery, &c., to the extent of about $7,000 or $8,000, and we have been at work ever since at that. Now, here is a small industry; there is nothing in the world anywhere in competition with us. There is but one machine that comes anywhere near being in competition with us, and that is located at Erie, Penn. It is a machine just calculated to do the same work; an invention which was made at nearly the same time ours was. I want to call the attention of this Commission to this fact: that in this instance we are employing the same class of labor which is employed by locomotive works, engine works, or factories working in iron. Everything we buy in the shape of iron, steel, copper, or brass is taxed. I have endeavored to find an argument by 7 Avhich this infant in- dustry can be encouraged under a protective duty. We are paying a tax to others ; but here is a little factory, which is destined to grow to a large one, taxed all the time on every tool and everything we use, in some form or other, at some percentage ; and yet this is a factory the like of which you will find in almost every town in the West. You will find in the valley over here just such little factories all around. We are kept down, held back, and bothered by 7 the expense we are put to in hiring our help, high rates of living, high prices of tools, high prices of machinery, high prices of materials which enter into the manufacture of that machine. Now, as a free-trader, or as anything else, 1 have never been able to find any man who is able to explain that particular situation. By Commissioner Oliver : Question. Are you still manufacturing? — Answer. Yes, sir. Q. What kind of goods? — A, Nothing but a folder; we are doing a little brass work. 1168 TARIFF COMMISSION. [VV. W. WITHER. Q. What wages do you pay? — A, We pay from $1.75 — I think that is the lowest for unskilled labor — to $3 a day. Q. Can you tell me what wages would be paid in England or Germany to the same class of labor? — A. I have a little Englishman working in my shop, who has told me repeatedly, and I can tell you now, what his views are upon the question itself— — Commissioner Oliver. We do not want his views. The Witness. No, of course not 5 but I say that by way of explain- ing what I may say. He says that skilled labor, such as he claims to be able to give, is paid just as much in England as here ; that he has made higher wages there than here; that he was better appreciated, to use his own language. Q. You do not believe that they pay in England $1.75 to $3 for that class of labor? — A. Yes, Ido. Q. Do you not know that it would not average one-third? — A. I will not argue the question. Commissioner Oliver. It is a matter of fact very easily ascertained. The Witness. If it is, I have looked for it, but have not been able to ascertain. Q. Do you not think you ought to have some little fair proportionate protection against the products made by this labor, which is only paid one- third of what you are compelled to pay? — A. No, sir; I do not. I would like to answer a little further than that upon that point. I do not want to make any argument. I would deem it but fair if the man from whom I buy my steel, my brass, my copper, enjoys protection or benefits under the law, that the government should as well tell me that I should enjoy a protection against the State of Pennsylvania, for I feel very much that competition, and it is the only competition I do feel. I cannot see any difference between myself here and my competitor in Pennsylvania. If I had my business in Pennsylvania I would have a good fortune. By Commissioner Underwood : Q. You complain of the price you paid for furniture. Have you ever, in the history of your life, known furniture as low in price as it is now ? — A. Well, I cannot speak as to that, because I have not investigated it. I think I can say as to wooden furniture, such as bedsteads, that they are probably cheaper than I have ever known ; but I believe it might be cheaper still. And I might say, as to that class of furniture, that I do not conceive that we have any very great advantage to gain from free trade. Q. Have you ever known carpets as cheap as they are now ? — A. Yes, sir ; I only know by experience at home. Q. Let us know what quality and when ? — A. I cannot tell you; I shall have to be excused when I have no specific information. Q. The testimony we have indicates that they are now manufactured at less cost and cheaper than they have ever been before, in the city of Philadelphia and elsewhere. — A. I have no doubt of that. Q. Have you ever known pottery as cheap as it is ? — A. I have known it to be cheaper abroad. Q. Do you not know that it is higher abroad now than it was fifteen or twenty years ago ? — A. I do not know that as a fact. Q. You stated in part of your statement that you wanted to enjoy the same free trade with foreign markets that you do with Pennsylvania and Massachusetts. You could not do that without abolishing all the duties upon imports, and you say that rather than have duties upon imports, you would prefer the income tax ? — A. Yes, sir. w. w. witmer.1 FREE TRADE. 1169 Q. Are you aware that an income tax has been tried in this country? — A. Yes, sir. Q. Do .you not see some impracticability in that? — A. I do not. Q. Does it not throw the burden of the government upon the men who honestly give in their incomes, and work favorably to those who fail to honestly return their incomes ? — A. I agree to that. Q. Is that a satisfactory mode of raising revenue? — A. I cannot answer it by yes or no. It is very unsatisfactory when it is not necessary. At home, the assessor comes around and he looks at my pocket and he sees a gold watch. My neighbor has his watch in a bureau drawer, and the assessor does not see it. I have no notes and mortgages to return. My neighbor makes it very convenient to exchange his notes and mortgages for government bonds about the same time the assessor comes round, or into greenbacks, or sends them off. His conscience is a little elastic, and he is not very rich that day. The same difficulty which you refer to in regard to the income tax applies precisely as to the jewelry, notes, mortgages, and other things of that character. Now, if it is possible to get anything like a fair report upon the one, it should be upon the other. A man who will swear that he has an income less than the law would tax, when iniact it is greater, would swear also that he had no notes and mortgages, if he had them. Q. The duties upon imports do not involve notes and mortgages; that is, under your State system. — A. I understand. I say if it was possible for the State to do so, then it is certainly possible for the United States to do so. Q. Do you not know that it is not possible for the State to get accurate information upon those things? — A. I do; and yet it tries it. Q. But it always fails. — A. Of course it is difficult ; but I very naturally incline to ask the question whether you may not abolish the personal tax, as indicating the policy? If one is objectionable, the other is. Q. Do you know that if the duties on imports were abolished, the part that the State of Iowa would have to pay to the general gov- ernment is about $9,000,000? — A. No, sir; I believe it would be more, but if that, or half of it, I object to it as the free-trader objects to it. Q. How would you get the $9,000,000? — A. I have indicated that. Q. Yes; you have indicated that you would still collect that by du- ties upon imports and upon specific articles. — A. Yes; largely. Q. And, among others, you specified wool. Do you not know that wool is now taxed? — A. Yes; but I would not tax it so high. Q. What rate would you propose upon wool and woolen goods in preference to the one that now exists ? — A. I believe a 10 or 15 per cent, duty upon wool would yield a pretty large revenue; and, if imposed alike upon wool and woolen goods, it would answer the free-trader’s idea of free trade. Q. How much importation of wool, woolen goods, and tea and coffee (those are the articles you specified) would it require, at the rate you propose, to raise the amount of revenue necessary to carry on the gov- ernment and pay the debt and the pensioners ? — A. I cannot answer that. Q. Would it not greatly exceed the whole amount of our exports? — A. No; I think not. Q. Do you believe that it is for the best interests of the country that the imports should exceed the exports? — A. I have no objection what- ever. That suggests the balance of trade. II. Mis. 0 74 1170 TARIFF COMMISSION. [CHARLES A. M’XAIR. CHABLES A. McNAIB. Saint Louis, Mo., September 18, 1882. Mr. Charles A. McNair, of Saint Louis, representing the Missouri Furnace Company, made the following statement: I am an iron manufacturer of Saint Louis. I do not propose to make a tariff speech, but I desire to say that the iron manufacturers of the United States have just had a convention at Cresson, Pa., and have appointed committees to represent the iron interest before this Commis- sion. I have simply come to say to you that our interests here require that we should have the protection that we have now under the laws. We cannot sustain ourselves as manufacturers of iron if the protection which we now enjoy is removed. There is a large amount of money invested in these interests in this city, all of which would be lost or destroyed if the protection were removed. As a manufacturer here in Saint Louis, I would be very glad to answer any questions that the Commission may put to me. By Commissioner Oliver: Question. How many blast-furnaces have you in Saint Louis and the immediate neighborhood ! — Answer. We have ten in Saint Louis. Q. Are they all running! — A. No, sir; there are only four running to-day and two of those will stop very soon. Q. All modern furnaces! — A. They have all been built since 1870, and some of them since 1874. Q. Only four out of the ten are running! — A. Yes, sir. We had six running up to a short time ago. Q. To what do you attribute the fact that you are only running a little over one-third of your capacity! — A. It is chiefly because the market is not as good as it was. There is not the same demand for pig-iron that there was six months ago. Most of the furnaces that were in operation were making iron for use in Bessemer mills. The Bessemer mills are not running as strongly as they were; they are not taking as much iron as they were. That is the chief reason; there is no profit in tne business. Q. What do you recommend in regard to the matter of rates! — A. I leave that entirely to the convention ; I do not wish to express any opinion on that subject. As one of the manufacturers of Saint Louis I desire to put myself on record as very strongly in favor of protection. It is not necessary, I sux)pose, for me to give my reasons; the Commis- sional ready understand what they are. ARCHIBALD MEANS.] SPELTER AND ZINC. 1171 AKCHIBALD MEANS. Saint Louis, Mo., September 18, 1882. Mr. Archibald Means, of Peru, 111., manager of the Illinois Zinc Company, addressed the Commission as follows : Gentlemen: The spelter and zinc interest which we represent, is comparatively a new business in the West, which has developed in the last fifteen years, and mostly in the last seven years, in the State of Illi- nois, Missouri, and Kansas. Commercially, zinc in slabs and plates is known as spelter, and when rolled into sheets is known on the market as sheet zinc. For several years, in the beginning of the development of this industry, much of the spelter was produced from zinc ores that had been thrown out as debris from the lead mines in Wisconsin, Illinois, and Missouri, and from surface deposits of ore, and consequently at a low cost per ton ; the lead and zinc ores being associated in nearly all these mining districts. We are not aware that the condition of the manufacture of spelter has been presented to Congress, and we are glad to have an opportunity of presenting the facts to you, and beg your consideration of them, in the direction of a lurther development of this industry. ’ We make the following estimate of the production of spelter for the year ending August 31, 1882, viz : Tons. In Illinois 15, 500 In Missouri 6,675 In Kansas 4,250 Total Avestern Tlie importation of foreign spelter in last fiscal year, as given by New York Metal Report, was 26, 425 11, 346 Total western and imported 37, 771 The capacity of the thirteen western manufactories at the present time is carefully estimated, viz : Tons. In Illinois.. In Missouri In Kansas . . 17,000 13, 200 9, 050 Total 39,250 The present capacity for production is therefore fully adequate to sup- ply this market. The estimated production of Europe for the year 1881 was 203,000 tons. The business on the continent is mainly carried on by large com- panies, some of which annually produce a larger amount of spelter than all the western manufactories, viz, in Illinois, Missouri, and Kansas. For some years past these foreign companies have been controlled by a combination, which is styled a syndicate, the object of which is to pro- tect their interests and supply their own market at a paying price to them. The result of this combination has been to maintain the price at home, while their surplus product was largely placed on this mar- ket, as the exhibit herewith will show, to the amount of 11,346 tons for the fiscal year ending June 30, 1882, against 2,085 tons for the pre- vious year, thus rendering the business fluctuating and uncertain. 1172 TAR I FF COMMISSION. [ARCHIBALD MEANS. Against this combination of foreign capital and cheap labor, we re- spectfully ask for an increase of duty on spelter and sheet zinc. The duty on spelter now is 1J cents per pound, and on sheet zinc 2J cents per pound, which seems obviously too low, and not in proportion to the duties on other articles in proportion to the cost. On bar iron, for instance, the duty averages about cents per pound, the duty on standard sizes being 1 cent per pound, which, with iron at 2J cents per pound, is more than 40 per cent, of its value. Steel ingots, which are worth less than spelter, pay a duty of 2-| cents per pound. Apply these duties to spelter at 5J cents value, and sheet zinc at 6f cents value, and we should have a duty of 2J cents per pound on spelter, and 2f cents on sheet zinc. The mining for zinc ores is now an independent branch of the business, and all the smelting companies purchase the ores they consume from the miners. As the demand for ores has increased the cost of the ores has largely increased, because of the increased expense of mining ; the cost of the ore to the smelting companies being fully three-fifths of the cost of the manufactured spelter. We will also state that the wages now paid our employes are lower than is paid in this country to the same class of skilled labor in other manufactories. Our product is largely consumed by manufacturers in more advanced articles of manufacture in the eastern and central States, and the trans- portation is paid by us to meet the price of the foreign article. The present rate from Saint Louis to New York is $7 per ton, and from South- west Missouri and Kansas 60 cents per 100, which is nearly one-half of the present duty on the foreign spelter. The process of the manufacture of spelter is by distillation, and a large number of men are employed for the amount of out-put. A block of eight furnaces whose average out-put would be 8 tons daily, employs 125 men, it requiring a greater amount of labor to the ton than any other metal except gold, silver, and copper. The number of men employed in these States, independent of those engaged in mining ore and coal, is about 3,000 men, and the value of the manufactured product annually about $4,000,000. In view of the conditions herein presented, the higher cost for mining zinc ores, the low cost of labor employed in this business, and the un- equal and inadequate duty now levied as compared with other articles of manufacture, we think we can ask with confidence that you will give our petition favorable consideration for an increase of duty on spelter to 2^ cents per pound and on sheet zinc to 2f cents per pound. By Commissioner Oliver: Question. What is the present price of American spelter? — Answer. It ranges from $5.25 to $5.40 at the present time. New York is the commercial center, and in speaking of the price of spelter, of course I speak of the price of it there. Q. What is the price of foreign spelter in New York ?— A. About $5.25, or it has been about that price. Q. Is there any difference in the quality of the two? — A. There is some difference in the quality of spelter. The eastern manufacturers, in the States of Pennsylvania and New Jersey, make an article of spelter which is superior to ours. It is a pure article of spelter, but it cannot be produced and sold at our prices. We are selling spelter at 5J cents, while their price is 8£ or 9 cents. It brings this higher price on account of its purity, and is used for many purposes for which the common ARCHIBALD MEANS.] SPLLTER AND ZINC. 1173 western spelter cannot be used. Some of the manufacturers prefer for- eign spelter for various reasons ; it seems to us because of their preju- dice in favor of it more than anything* else. I do not see that there is difference enough in the quality to make the difference in the price. Some kinds contain more lead than others. Foreign spelter is not free from lead. Q. I asked the question to elicit the fact whether after all it was not more a matter of prejudice. A great many people think foreign arti- cles of all kinds are better than domestic articles. If you should get the higher rate of duty for which you ask, would there not still be a certain proportion of foreign spelter brought into the country ? — A. I hardly think there would be. Some of the merchants on the seaboard will buy foreign spelter and zinc for the reason that they can export it, or it can go into articles of export, and they get a rebate for so much of it as enters into the manufactured article. To that extent those who export will want to buy the foreign article to get that rebate. Q. They buy it of foreigners and put it in with some of their articles and get enough per cent, rebate in sending it off to other countries to make it profitable to them ? — A. Yes, sir. Q. Has not the development of this interest in the three States you have named, Illinois, Missouri, and Kansas, been greater than in all the other States of the Union combined? — A. Yes, sir. There is a great deal of ore in Wisconsin, Illinois, Tennessee, Arkansas, and Missouri. Q. When was this duty of 1J cent on spelter and 2J on zinc imposed ? — A. I think it was about 1861. Q. Did not the protection given by this duty have a tendency to in- crease the production in this country very largely? — A. Yes, sir; I suppose that is true to a large extent. Q. Did you not build your factories and reach this large production under the protection that the law gave you fifteen years ago ? — A. Yes, sir; certainly. We have been living under the laws as they are. But there are certain conditions which are changed since the development of the industry. In other words, ores cost us to-day 100 per cent, more than they did ten years ago, and previous to that time they cost still Jess. The reason for chat is, that in the beginning of this industry much of the spelter was produced from zinc ores that had been thrown out as debris from the old mines in Wisconsin, Illinois, and Missouri, and that was collected at a mere nominal cost of a few dollars per ton. In 1872 I paid about $7.50 a ton, while to-day some grades of ore bring $22 a ton. Latterly much of the shallow mining has been done. Now we have a different condition of things surrounding our industry. The mining interest has developed, and it is now a matter of the actual cost of labor, so that the ores themselves are costing a great deal more to mine. We expected that the mining interest would be here to represent their views in this matter, and therefore I have not referred to them in my remarks. Q. How lias the business attained such large proportions? — A. It has been carried on in a desultory way. There have been as many as five, while now there are only two establishments in our country. In Saint Louis there are three concerns, one of which has suspended opera- tions. Some of them have suspended on account of the low price of spelter. By Commissioner Underwood : Q. What is the extent of the deposits of ore ; are they large or small ? — A. The ore deposits seem to be in pockets or nests or running in ter- 1174 TARIFF COMMISSION. [ARCHIBALD MEANS. races. Sometimes a pocket is quite large, and it will be mined in paying quantities, and then gradually drop down until it does not pay the ex- pense of taking it out. It is not regular. Q. Does it run in veins or lodes ? — A. Some in veins. So far as Southwestern Missouri is concerned, I do not think it can be said to be a vein ; it seems to be in areas. Q. Has the value of these ore-beds increased or enhanced in price ? — A. Ore lands have. Q. Has not the raising of the price of the ore by the owners of the mines had more to do with the price of spelter than Ifhe cost of the labor necessary to get the ore? — A. No; I think not. I should have been glad if the mining interests had been here to-day to state the facts in regard to their business. They claim that the wages of labor is inadequate; that is, that the men do not get fair wages. The prospecting is done by men who lease a lot of, say, 200 feet square in some cases, from the min- ing company, and they pay a royalty, such a proportion of the ores which they may mine or get out of that piece of ground. Q. How much is that ; what is the average worth? — A. It varies in different places. It is usually one-eighth, or 12£ per cent, given to the owner of the land. By Commissioner Garland : Q. I understand you to ask an advance of this duty from 1J to 2J cents ? — A. Yes, sir. Q. What do you expect would be the effect of that on the price of the article? — A. It will do just this: it will leave the competition largely be- tween the producers of spelter at home, and the business will not be sub- ject to the interposition of the dealers in the foreign article. That is the object in view; simply to let the American manufacturer supply it and take his chances. By Commissioner Underwood: Q. You think there would be no danger of a syndicate here? — A. No, sir. By Commissioner Garland : Q. Would it advance the price of spelter in this country? — A. No, sir; I think not, materially. Q. Would it not be possible, on account of the few persons engaged in the business, to make a combination rather than to provoke competi- tion? — A. No, sir; I think not. I have had some experience in that matter in past years, endeavoring to protect ourselves here. We have never asked any legislation on the subject. We have endeavored sev- eral times, but have failed always, to get a combination that would do us any good. Whatever arrangement w T as made would be temporary and not permanent. ADOLPHUS MEIEK-1 FREE TRADE. 1175 ADOLPHUS MEIEE. Saint Louis, Mo., September 18, 1882. Mr. Adolphus Meier, of the firm of Adolphus Meier & Co., of Saint Louis, addressed the Commission as follows : Gentlemen: I notice from the daily journals, referring to the pro- ceedings had before your body, that all testimony and information is re- ceived, be it in favor of higher or lower duties than those existing at present, or of retaining the present tariff. The large mass of information collected in this way is awakening more interest in the tariff question among the people generally, and the daily proceedings, as published by the press of the country, place this informa- tion within the reach of every citizen who feels an interest in the prog- ress and welfare of the people of the United States. Having been engaged in mercantile and manufacturing pursuits in this city since 1837, we have, in this period of forty-five years, witnessed the changes produced by tariff legislation and by burdensome iuternal- revenue laws on the general trade of the country, and we wish to sub- mit our views on this subject to your body, and to point out what we deem is demanded and imperatively necessary to be done at the present time. Our business, during the forty-five years mentioned above, has been jobbers and importers of foreign and domestic hardware for thirty-five years; exporters of leaf tobacco for forty years; interested as managers and stockholders in the manufacture of cotton goods, pig iron, and rail- road iron for periods ranging from ten to thirty-five years. Without referring to the past, and to the necessity existing at the time to call into life our exorbitant and unwise tariff for the purpose of raising an immense revenue to pay war expenses, or to the questionable advan- tage the present tariff may have had in creating artificially an enormous industry by the rapid erection of numerous factories and workshops, we will limit our remarks to the present condition of the question, to the prospects of the future, and to the influence the present import duties may have on the general prosperity of the country at large. We claim that the present import duties, being collected from nearly every article of luxury and necessity imported into this country, are the cause of the high cost of living, and, consequently, of the high prices of labor, and that this enhances the cost of manufacturing iu this country, so that our own people, who are practically the only consumers of our manufactured goods, have to pay this extra cost — a tax on their daily wants. The revenue the present tariff produces is mostly paid by the sons of toil — the tillers of the ground, the miners, mechanics, artisans, and laborers — while the men of wealth contribute but a small percentage of the revenue, by the consumption of articles of daily ne- cessity, so that the effect is to make the rich richer and the poor poorer. The high cost of manufacturing in this country, as caused by the present tariff, prevents the people of the United States from competing with other nations less favorably situated for the export trade in manu- factured goods to foreign countries, prevents us from re-establishing a merchant marine that in ante : bellum days was. the admiration of tbe world, makes us pay large amounts of money tor freight to foreign capi- 1176 TARIFF COMMISSION. f ADOLPHUS MEIER. talists, and leaves us only raw products for export to liquidate our balances. If the great commercial and manufacturing countries of the Old World cannot dispose of a part of the product of their workshops to this country to keep their own labor employed, it follows that they cannot take from us our surplus grain and provisions, excepting at such low prices that it may mean ruin to the American farmer, who is taxed through the tariff on every article he wears, eats, or uses. The demand by some manufacturers for a still higher tariff we look upon as a sign of the times, and it clearly illustrates that in many brandies of manufacturing there is no profit, and therefore it is natural for some manufacturers to demand more protection, under the belief that such a change will insure them better profits 5 but they are either ignorant of the fact that every additional protection means a corre- sponding advanced price for labor and materials, or they have no faith in the stability of the present system, and ask for an increase of duties in the hope of receiving, as speedily as possible, profits large enough to pay for their investments. So far as the future of our industries is concerned, we cannot take a hopeful view of their condition, if the present high and discriminating tariff is kept 011 the statute book. While the population of the United States is growing at a more rapid rate than that of any other civilized country, the consuming power of the people may be equal to the pro- duction of manufactured commodities, but a time will come when a slower annual increase in population takes place, owing to a restricted or diminished immigration ; in the event of which, the continuous excess of production, compared to any possible consumptive demand, will make itself felt, as has already been the case in the period of time from 1873 to 1879, and it was only the remarkable coincidence that three crop failures occurred successively in most European countries, while we were blessed with superabundance, that enabled us to dispose of our surplus food products at such remunerative prices as to restore a temporary equilibrium between the demand and supply of manufactured goods. But one partial failure of the crops in this country last year immedi- ately brought about a similar condition of affairs as existed prior to 1879, to wit, overproduction of nearly all kinds of manufactured goods, a falling market for them, but a high market for labor and materials. There is a want of elasticity to our manufacturing trade that makes itself felt at once upon the occurrence of any slight disaster ; we cannot get relief from foreign trade in such times, and we immediately choke on our own overproduction. Hence, we should build up our foreign commerce in exports, but that can only be done gradually; and it will be necessary to reduce duties to a point that will enable us to manufacture at a lower cost than can be done at present. We cannot see that the working man is in any way protected by the present tariff', for his cost of living is increased even in a larger ratio than his wages; and if wages remain very high for a few years it causes an influx of European surplus labor, which of course will be employed in some manner, and labor, being an article of demand and supply, as any other commodity, we may see labor decline by oversupply, goods, wares, and merchandise selling below cost on account of overproduction, aud yet the cost of living, such as rent, food, and fuel, kept up to a point that will prevent any savings out of the earnings of the working classes ; aud where there are no. savings there is no accumulation of capital. In reference to the question, what influence the tariff' has on the gen- ADOLPHUS MEIER. J FREE TRADE. 1177 eral prosperity of the country at large, I have partially touched on this point in my previous remarks 5 hut I may add that the United States are not adding to their national wealth in each decade as much as they would if the tariff was reformed to a more just, equitable, and less bur- densome basis. The superior skill of the American artisan and mechanic, the constant anxiety and work of the American farmer, is not being properly compen- sated, notwithstanding apparently remunerative wages. Values of a good many things are inflated, and the savings of the working people, if they have any, can only be invested in securities or real estate at an inflated value, thus making a return in the shape of interest on such investments, even at a low rate, very problematical, and involving the risk of a partial loss of capital, when values are fixed on a lower basis, under any subsequent reduction of our tariff or internal- revenue taxes. We will not dwell at length upon the burden entailed upon the peo- ple by the internal-revenue taxes, especially the tax on bank deposits, being virtually a tax on capital, nor will we argue the detrimental in- fluence of high local taxes or consider the threatening danger arising to the manufacturer byre-establishing a silver dollar of 87 ^ cents’ value in gold, and their continued coinage, notwithstanding the reluctance of the people to use this coin ; but these influences certainly add to the evil effects of the present tariff. We predict that if the present high tariff is maintained, and perhaps even increased on some articles an industrial crisis will become inevit- able, and it will be the most severe and trying calamity the country has ever had, for it will throw thousands and thousands of workingmen out of employment, close our mills, mines, and workshops, destroy credit and confidence, and particularly will it impoverish the man who works for his daily labor. In our business of cotton manufacturing, we are free to say, we need no tariff of any kind; we know we can compete with any country in this branch if we are allowed to purchase our machinery where it is the cheapest; and if cotton mills could be erected in this country at as low, or nearly as low, a cost as they are in Europe the United States would very soon acquire a large share of the trade in cotton goods to foreign countries, and spin and weave the bulk of its own cotton crop, instead of exporting nearly three-fourths of our annual raw material. So far as we are interested in the manufacture of pig iron, we think this article could stand a reduction in the tariff to about $2 or $3 per ton, while for manufactured iron and steel a very material reduction of the duties seems to us as necessary. We ask for free admission of iron ore, as that will reduce the value of it here and enable steel and rail manufact- urers to use American steel for their rails, instead of importing foreign steel blooms, the latter being imported at a considerable less rate of duty than steel rails, which pay nearly 100 per cent, on first cost — all of which is very injurious to the manufacturers of pig iron in this country. The United States have inexhaustible deposits of ores and fuel, and, under ordinary expenses for labor, coal, and freight, and a materally reduced cost of plant, the furnaces and iron mills of this country could, we think, compete with their European rivals in all our home markets, and possibly also in South America, Mexico, and the West India Isl- ands. If it needs a protection, such as we now suffer under, to sustain the iron and steel business of this country, where the raw material is in such abundance, there must be something radically wrong if iron ores can be imported cheaj)er than they can be got here. 1178 TARIFF COMMISSION. [ADOLPHU3 MEIER. While we emphatically believe that every country with as many natural resources and advantages as this country possesses must be more prosperous under free trade and low prices, as against burden- some protection and high prices, we cannot urge a sudden change of policy, as this would tend to greatly unsettle values and possibly might produce disaster. We favor for tariff reform the following plan : I. A large reduction in the number of articles to be taxed. II. Absolutely free trade in all raw materials that this country is capable of producing. III. A very moderate tariff, say 10 to 15 per cent., on all articles par- tially manufactured. IV. A general reduction of the tariff on manufactured goods at the rate of about 20 per cent, per annum, until the average tax does not exceed 25 per cent, on the value of the imports of this class. V. A full taxation on imports of all articles that this country cannot produce, such as coffee, tea, indigo, silks, coco, rubber, drugs, and all articles of luxury. VI. Free trade in books and works of art. VII. Specific duties, whenever practical, as there is less room for false entries. VIII. Abolishment of custom-houses when they are not necessary. Whenever a settled and defined policy has been at work on this question for a few years, under a reform similar to above, we believe there will be a rebound in our prosperity, such as the world has never before witnessed. We believe the present tariff prevents the annual production of wealth from being properly distributed among the mass of the people ; whenever this is cured — and the tariff, as it now exists, is the great obstacle to the cure — the pulse of trade will quicken, a new start will be made, and another great step will be taken by this nation to the front rank of all nations, in the peaceful rivalry of that commercial and industrial supremacy that is within our grasp. By Commissioner Oliver : Question. Your suggestions are somewhat radical in their character, and 1 will ask you a few questions in regard to them. You are in busi- ness here in Saint Louis, are you? — Answer. Yes, sir; we are engage.- in business here; have a trade throughout the West, and also an export trade. Q. I will ask you, as a business man, this question: If we were to adopt your recommendations, do you not think the result would be, for a time at least, serious trouble? — A. No, sir. Q You think the adoption of what you recommend would not inter- fere with business ; that the business of the country would go along smoothly, easily, and quietly ; and there would be no jerk or strain ? — A- I think it would have no influence whatever upon business. I provide for a gradual diminution of duties on manufactured goods. I do n ot recom mend a sudden change, such as taking the duty entirely off articles now paying 40 or 45 per cent., but I would recommend a reduction, say, to 25 per cent., and in that way have the change gradual. Q. As I understand your suggestions, the plan you recommend would require a series of years before it could be fully carried out? — A. I pro- vide for a gradual reduction, continuing over a period of three, four, or five years. Q. As a business man, do you not think that the American people ADOLPHUS MEIER. J FREE TRADE. 1179 would be apt to discount at once, and quickly, any action such as you propose; and would not that, of itself, cause a great deal of trouble throughout the country? — A. That might be the case for a time; but if you change the tariff in any respect they will do the same thing. We are subject to more radical changes in this country than in any other part of the world — changes in weather, changes in crops, overflows, &c. — and yet we adapt ourselves readily to the situation. I intended my remarks to apply principally to the subject of cotton manufacturing, a business with which I have been connected for twenty years. We are also interested in rolling-mills. So far as cotton manufacturing goes, having tried this tariff for twenty years, and finding that we only export 3 per cent, of our goods against 97 per cent, of goods received from for- eign countries, any one can see that we are not getting ahead as we ought to. Q. When you went into business, twenty years ago, what was the price of the common print or calico that is usually sold? — A. From 7 $ to 8 cents. Q. What is the price of it now? — A. From 6J to 7 cents. Q. Is not that reduction in price a great advantage to the consumer in this country ? — A. Yes, sir. Q. Would you not attribute that result to protection, at least to some extent ? — A. No, sir ; I attribute that result certainly to the fact that in every manufacturing business the methods are gradually improving, and owing to the improvements iu machinery the manufacturers are enabled to produce cheaply, although the cost of labor may be tempo- rarily higher. We could produce goods still cheaper and get more of the world’s trade if we had not such high taxes to pay for our materials and labor. Q. Do you think these improvements in machinery would have been made, or that the capitalists of New England would have advanced their money to put into these enterprises, if they had not had some pro- tection in the way of a duty placed on the foreign articles, iu that way giving them the benefit of the home market ? — A. If we go back to that, I admit that high protection, for the time being, may be a benefit. Q. That is it exactly ; didn’t it have the effect of inducing these peo- ple to invest their capital and develop these industries ? — A. Yes, sir. Q. But you think the time for protection has gone by so far as cotton goods are concerned ? — A. Yes, sir. Q. Still we have developed that i ndustry under the protective system, and now sell the cheapest prints in the world. Do you not think the same policy should be applied to other manufactures ? — A. I do not admit that we make the cheapest prints in the world. I know that American prints are exported to Asia and Africa, where there is a large consumption of those goods, at a difference only in value of from 15 to 20 per cent., but that is done to keep our factories going. Our home consumers are paying 20 per cent, more for the same goods. Q. The recommendation you make is that the revenue, which you acknowledge must be raised in some way, should be raised by placing a duty upon articles not produced in this country? — A. Eaw materials, I said. 1 favor a revenue upon all raw materials which we are not capable of producing. Q. You recommend the raising of our revenue in that way? — A. Yes, sir. Those articles that we can produce we ought to tax, and those we cannot produce ought to be admitted free. Q. You recommend also a duty on tea and coffee ? — A. Yes, sir. Q. Of course we must look to the interests of the people in this mat- 1180 TARIFF COMMISSION. [ADOLPH OS METER. ter. Do you think it a wise political policy to tax an article that is consumed in every household in the country — an article that the labor- ing men of the country use ? — A. We are taxing the laboring men on everything now, and if we tax them only on coffee and tea and a few things of that kind they will be better oft than at present. Coffee and tea were on the tax list at one time. Q. Yes ; but that was done as a war measure. — A. Yes, and it was taken off' as a political measure to satisfy the people. The mass of the people do not understand these questions, and perhaps they never will thoroughly understand them. Q. I ask you as a business man if it would be wise to tax tea and coffee ? — A. I think it would. Q. Then you would also object to the policy of taking the taxes off spices and other foreign productions? — A. I would be in favor of taxing coffee 10 cents a pound and tea 20 cents a pound, and of placing a tax upon all articles of luxury. Q. That is to say, you believe in placing a direct taxation ujion the people ? — A. Yes, sir, as nearly as possible ; that is the point. By Commissioner Kenner : Q. I presume you are well aware of the fact that in that section of the country known as the South the people are starting on a career of manufacturing, particularly the manufacturing of cotton goods. What effect would your suggestions, if carried out to their legitimate conse- quences, have upon these small factories in the South ? — A. I think they would be more prosperous than they are at present. Q. But you stated just now, in regard to the manufacturing industries of the North, that the tariff was found advantageous to those industries. If such was the fact, then if the North required protection in order to start its factories, why would a change of that system affect the South advantageously ? - A. Whether the tariff is the direct and only cause of that prosperity of the Northern cotton manufacturers is hard to de- termine. 1 say that the Southern manufacturer now could not reap the same benefit, because competition is already closer, and if free trade was established he would get his labor, machinery, and everything of that kind at a lower cost than now in competing for his home own market. Q. You think, then, the strugglinginfantfactories of the South would be benefited by free trade? — A. Yes, sir, because I am well aware that many of those factories are not profitable at present. Q. You cannot deny that the manufacturers themselves think they have advantages from the tariff system? — A. Some of them think so. Q. The most of them think so, do they not ? — A. I think many of the intelligent manufacturers now are beginning to change their ideas on that subject. . Q. Do you not think the majority of the manufacturers understand their own interests ? The most of them who appear before us recom- mend the maintaining of the present system. Therefore itis safe to pre- sume that they think it is advantageous to them, because they advo- cate it. — A. 1 have no doubt they do, but I see many manufacturers who think it is a burden, and that they are not getting any benefit from it. Q. In the beginning of our manufacturing industries we stood in a cer- tain relation to the manufacturing industries of England. They were in their full strength and ours were in their infancy. Is not that the fact now with regard to the Southern factories ; do they not stand now in the same relation to the Northern factories that the Northern men did towards the English when the present tariff system was adopted? — ADOLPHUS MEIER-l FREE TRADE. 1181 A. No, sir ; the Southern manufacturer has many advantages which would offset any free trade-policy. Q. I think the South stands in the same relation to the factories of the North now that the factories of the North did towards England then. At that time the English people were very anxious that we should not levy this tariff, and said it was not necessary. Can you not imagine that the cotton manufacturer at the North who sees the advan- tages that would accrue to the manufacturer of the South under the present system, would say that he no longer needed a tariff in order to check the development of these Southern factories? — A. No, sir; I do not think there is any such feeling. Q. You think he is too good a man to have any such feeling ? — A. No, sir, I do not think that; but I do not think it would be for his interest. The South can sustain itself in cotton manufacturing either with a mod- erate duty or free trade. Q. You advocate the reimposition of the tax on coffee. Are you aware that it is a system of government adopted in many countries outside of the United States, particularly those that produce tropical plants, to impose an export duty on goods just in proportion as the American government reduces the import duty upon all articles which they make or which are the natural growth of the country ? — A. I am aware of that. Q. I)o you not realize the fact which has always occurred, that when certain articles of this description are imported free, the foreign gov- ernment immediately places an export duty on those articles, and the American public are made to pay as high or a higher price for those tropical goods when they come in as they did when the duty was im- posed by our owi# government? — A. Whenever a country places an export duty on its products the people of that country pay the duty. Q. Are you aware of the fact that for many years alter the import duty on coffee was removed our people paid a higher price per pound for it than they did during the existence of a moderate duty upon it? — A. Yes, sir; I know that; but Commissioner Kenner. That is a conceded fact, but I do not care to enter into any discussion in regard to it. By Commissioner Underwood : Q. Do you say that prints or calicoes are manufactured in Europe cheaper than they are in America? — A. Yes, sir. Q. What is the difference in the price? — A. I am not so familiar with the details of that matter. There is a difference in their width. The English prints are 36 inches wide and ours are only 21 inches wide. But the cost of the gray cloth and of the common cloths made of cot- ton, such as the great mass of the people in the East Indies and China use, are always cheaper in England than here. We are getting some export trade for our goods, because the quality of our cloth is superior to that manufactured in Europe, and they will always take a certain percentage of American goods on account of their better quality. But we cannot manufacture these goods cheap enough to command that trade. Our export of cotton goods last year amounted to $13,000,000, while the export of cotton goods from Europe amounted to $395,000,000. By Commissioner Porter : Q. Do you mean Europe or Great Britain? — A. I mean Great Brit- ain, France, Germany, and Belgium; Great Britain especially. Q. Are we not manufacturing prints in this country at 5J cents a 1182 TARIFF COMMISSION. [ADOLPHUS MEIER. yard? — A. They may he selling some at that price. I doubt whether they are manufacturing them at that price. By Commissioner Underwood : Q. Are you acquainted with the wholesale j) rices of these goods in New York City? — A. i am not familiar with the colored goods, but I am fa- miliar with the plain white goods. Q. My impression is that they are selling them at 4 cents a yard.- — A. They are not standard grades of goods, then, because they are worth now 6^- cents, and in some instances 7 cents, and there is no money made on them at that price. Q. I know that in some small places they are selling at from 4 to 6 cents a yard. — A. These goods are frequently sold at a less price than the cost of manufacture, in order to create a trade. Sometimes a country will sell goods very low indeed because of certain conditions of trade. The tailure of our crops last year had a tendency to curtail the consump- tion and bring down the price of goods. With a large export trade to Europe prices will rise, but the tariff will not have any influence in that case. So far as the prices are concerned, the standard make of prints is about 6| cents, with about 5 per cent, off for the trade. Owing to the high tariff there is a large additional cost for the colors used in the man- ufacture of these goods. By Commissioner Boteler : Q. Yon say that you are in favor of the abolition of all duties upon raw materials not produced in this country, and subsequently you said you were in favor of the introduction of iron ores free of duty.— A. Yes, sir; that is a raw material. ^ Q. But it is produced in this country not only in large quantities but in every variety. — A. If I wanted to enumerate every article that could be produced here and in other countries I would have to go through the whole list. 1 mean that in a general sense. Q. H ave we not every variety of iron ores in this country? — A. Yes, sir; I think we have. Q. And are they notin great abundance? — A. Yes, sir. Q. Do you think it is good policy to develop these resources of our country? — A. I think it is. Q. Do you think it would tend to develop these resources if the iron ore from the Mediterranean and from Europe was introduced here free of duty? — A. I think it would. Q. In what way? Please explain. — A. Because many of these ores make very good mixtures with our own ores. Q. Do not the different varieties of our own ores do that also? — A. Not altogether, as I understand. I think a competition with foreign countries would be a great benefit to the development of our manufact- ures. Q. You know the fact, I suppose, that English ore is brought in as ballast? — A. Yes, sir; in some instances. Q. And your idea is that that should be encouraged? — A. I do not think it would follow that if we had free trade, or even a moderate tariff, ships would come out in ballast at all. Q. There are portions of this country, particularly my own State of West Virginia, where we are beginning to discover and develop our wounderful natural resources, particularly of iron and coal. They are at present infant industries. Do you think it would be well to check them? — A. 1 do not admit that they would be checked. On the con- ADOLPHUS MEIER.] FREE TRADE. 1183 trary, I think they would be encouraged. If you have such wonderful resources of coal and iron, you ought to get along with small protection. Q. Do you think it would be well for us to have to depend upon for- eign countries for these essentials? — A. No, sir. I think under free trade we would soon assume a similar position to France and Great Britain. Whenever locomotives are scarce in England they buy them in France, and vice versa . They exchange their commodities all the time, and we would do the same thing. Q. You know how the present condition of English trade has been attained I — A. Yes, sir; I do ; but we cannot compare English past his- tory with our own. If you want to go into all that detail, you will have to investigate every county in the State to see what its natural resources are. Q. Then it is your idea that it would be an advantage to our ore pro- ducers to have the European ores brought in free of duty ? — A. No, sir; 1 do not say that. I say anything that brings down the cost of production and labor is beneficial, and if the tariff is the instrument that keeps it up, it would be a benefit to the American people to have it abolished, for the cost of living is in the same ratio. By Commissioner Kenner : Q. What do you call raw material? — A. I call raw material every- thing that is produced directly out of the ground. Q. Is corn a raw material? — A. Yes, sir. Everything in which no .manufacturing process has taken place is a raw material. Q. Is pig iron a raw material ? — A. No, sir ; it is a partially manu- factured article. Q. Is not ore a partially manufactured article? — A. No, sir. Q. What gives the value to the ore? — A. The cost of raising it out of the ground. Q. Is not that the cost of the manufactured article, and the cost of the labor which digs it up? — A. I regard everything that is produced in its natural state without any mechanical process as a raw material. Q. Of course iron ore in the ground is a raw material, but when you dig it up and send it to foreign countries is it still a raw material? — A. Yes, sir. Q. Under what head would you put the cost of digging, and shipping, and freight, &c.? — A. Those are items that simply add to the cost of it. I do not call it a manufactured article. The article itself undergoes no change any more than if you take corn and ship it to Liverpool; it is still a raw material. Q. You count the labor of making the corn, and taking the ore out of the ground, as nothing? — A. Oh, no, sir. I do not say that. Q. Is not the raw material of one man the basis of the manufacture of another? — A. I call every article a raw material that lias not changed its character by mechanical manipulation. Q. You think the ores from Spain or Africa, which are developed at a cost of labor at from 12 to 15 or 20 cents a day, should be admitted into this country on an equal footing with the ores produced in America with the cost of labor at, say, $1.50 a day ? — A. Y r es, sir; and I think we would soon adjust our mod(?s of transportation so that with the cost of bringing the ore in, and the increased demand for it, they could not compete with us, and they would not bring it in. Q. Who would suffer while you were adjusting these matters? — A. I do not think anybody at all would suffer. Q. Not if the price of labor was brought down in this country to an 1184 TARIFF COMMISSION. [ADOLHIIUS MEIER. average of 20 cents a day, as it is in Africa or Spain'? — A. You assume that it will be brought down, a fact which I do not admit. I do not admit that our labor would have to come down to 20 cents a day. Per- haps we might raise up the price of their labor to $1 a day. We do not know what the effect will be until we try. I am not afraid of their com- petition. I believe every country enjoys certain natural advantages, and that these things will all adjust themselves properly. Q. You think the cotton manufacturers of the South, with their prox- imity to the cotton fields and their saving of transportation, would have an advantage more than compensating for a tariff upon their manufact- ures? — A. Yes, sir. By Commissioner Oliver : Q. You spoke of the interchange of commodities abroad, and in- stanced the case of France and England. Which of the two countries named do you consider has been the most prosperous for the last ten or twelve years ? — A. I think England is a more prosperous country than France. Q. And makes more money? — A. That is hard to determine. But England has shown that with three successive crop failures, and with the disadvantage of having to carry on great wars in the east, it cm maintain a good state of prosperity. Whereas if the prosperity of France is looked into it will be found that it is mostly on the outside, and is not a genuine prosperity. Q. But there is no interchange in the way you have named, because the tariff of France is higher proportionately and on the average than our own tariff*. — A. I know it is on some things, but not as a rule. Q. It is on everything that you have named. — A. But they have a reciprocity treaty there which we have not. Commissioner Porter. That has been repealed. The Witness. But I am speaking of the time when that treaty was in existence. Whenever there was a scarcity in England they could import from France, and vice versa. In regard to the paying oft' of the French war debt, although France has paid it to Germany, yet the debt is still owing among themselves. Commissioner Oliver. They have abandoned the reciprocity treaty and have become protectionists. E. A. HITCHCOCK.] STEEL AND GLASS. 1185 E. A. HITCHCOCK. * Saint Louis, Mo., September 18, 1882. Mr. E. A. Hitchcock, of Saint Louis, addressed the Commission as follows : In regard to the ma tter of the tariff on steel, I would state tha t I returned yesterday morning from the iron and steel convention, which has been held at Cressou, Pa., some account of the proceedings of which you doubt- less have seen in the papers. As that convention appointed a committee consisting of two members representing each of the various interests of ore, steel, and iron, both in the raw and manufactured state, and as that committee will report to you when you return East, I do not think it would be proper forme to anticipate here the results of the deliberations of that convention. But perhaps I may say generally, with respect to the eleven large steel mills of the country, one of which is located in this city, that the conditions surrounding them are somewhat different, and they ought not all to be put upon the same basis. Those in Cleveland, Joliet, and in this city are differently situated from those in Pennsylva- nia and New York. I say this because a great hue aud cry has been raised all over the country at the bugbear of steel rails and pig iron, and the manufacturers of Pennsylvania are pointed at as great monop- olists. This may or may not be true; they will defend themselves at the proper time. But the Western mills desire the full protection that will be asked for in the report that will be submitted to you by that committee. We say it is a question of labor and protection to the laboring man. The company I represent has three departments: iron, ore, and manufactured articles of steel. We employ 3,000 men, ami manufacture only steel. We have no accessories. We have no other enterprises connected with the business from which we can derive a profit, and when the steel industry is, as at present, most extraordinarily depressed, even with the protection that is asked for now, there is no money in the iron business. However, that matter will be submitted to you by this committee appointed at our convention. What we desire above all things in Missouri is immigration, and we cannot get that immigration into this State unless we properly develop all the resources of the State so as to furnish employment to the immi- grants. It will not do for our farmer friends to say that they will take all that labor and develop, the agricultural resources of the State. The State will only prosper as all its resources are developed, and labor is employed in that development. We want that labor to develop the State, and the manufacturers to assist m supporting that labor, and w r e must have it, particularly in connection with our large iron interests. The gentleman who has just addressed you [Mr. Adolphus Meier] rec- ommended the abolishment of the duty on ore. Ko State in the coun- try except Michigan is so favorably situated as Missouri iu respect to ore deposits. Yet I am told by Mr. Ely, who represents the ore section of that State, that out of fifty millions of capital invested, there are but very few companies paying any dividends at all; three-fourths of that capital has paid no dividends for years. We want that ore interest protected in this State, and indirectly we want pig iron protected, be- ll. Mis. (i 75 1186 TARIFF COMMISSION. [E. A HITCHCOCK. cause we want labor to come in here and develop the interests of this great State of Missouri. That is all I have to say about iron and steel. Coming to the matter of plate glass, I would say that it was not the intention of the Plate Glass Company to make any representations to the Commission at all on the matter of the duty on plate glass. We desire that the duty should remain as it is. It is a new industry. There are but three or four factories in the United States, and they have been struggling along for the last ten years, and it is only within a few years that any of them have made a profit, and that has been so small that if you distribute it over the number of years that they have been engaged in the manufacture of plate glass, it amounts to almost nothing. In the future, under the protecting influences which the government has heretofore extended, it certainly will prosper, and the day will come when we can afford to stand alone without any protection, and when that day comes we shall not ask for any protection. I will submit for your information some statistics, prepared in 1878, which cover the whole ground, and give an unanswerable reason why this young industry should be protected. The statistics have not materially changed since they were prepared; but one point is not included, viz, a table showing the difference in the price of labor (for three fourths of the cost of the man- ufacture of plate glass is represented by labor), which proves that we pay in this country, as compared with England, Belgium, and France, all the way from two to four and five hundred per cent, increased wages. We cannot compete with those countries unless we are protected to some extent. To my mind one of the most important matters connected with this new industry is the fact that we are educating at these two or three factories skilled men, who will be required in the other factories which will ultimately be established in this country. I regard it as a training school, and as exceedingly valuable, looking at it in that aspect. As the American people are notoriously a people in favor of education and do not begrudge being taxed for educational purposes, I think in that view alone, if for no other, we should receive a reasonable protection. When you analyze these reports you will find that the American people are taxed less than two cents per capita as regards this manufacture of plate glass. I believe they are willing to pay even more than that if they are satisfied that the result will ultimately be that the new manu- factories which will spring up will be supplied with skilled labor now being educated in our own factories. I believe in time we can make all the glass that is needed in this country. We do not want foreigners to come here and pay from $25,000 to $40,000 a year in office expenses and take the balance of the profit back to Europe, but we want to keep the balance of profit in this country. I look upon our present efforts as being in the direction of educating skilled men that the country must have within a few years in this branch of the business. By Commissioner Porter : Question. The manufacture of plate glass began in this country how long ago? — Answer. I think 1870 was the beginning of it. Q. How much plate glass is manufactured now in this country? — A. At the end of this year, when our improvements are completed, we shall have a capacity of 2,000,000 feet, or about one-half of the con- sumption of the United States. The importation ranges from two to four millions, depending on the price of other building material. This spring, in New York, everything whs so high that building stopped to some extent, and then the price declined. The establishment of these E. A. HITCHCOCK. | STEEL AND GLASS. 1187 plate-glass factories in this country has reduced the cost to the con- sumer from $2.50 to $1 a foot on plate glass. We have accomplished that for the consumer within the last ten years. I have glass in my own house that was put in twenty years ago, which cost $2.50 a foot on the average, and I should be very glad to supply that same quality of glass for several years to come to any parties desiring it for $1 a foot. The moment that the duty on plate glass is reduced these manufacturers will be crippled, and the foreign manufacturers will return to the policy that prevailed before the American factories were started. They will see this statement of mine no doubt, and will deny it, but it is a fact that can be proven. Combinations were made in England, France, and Bel- gium before the American manufactories were started, and they agreed not to sell to America except at a certain i>rice, and we were at their mercy. At present they cannot combine against us, because the Amer- ican manufacturers have refused to go into the combination. As long as American factories are in existence, they will hold in check all such combinations that the foreign importers may try to make, and any ar- rangements that they may make will be like ropes of sand. But, destroy these factories and you will have the prices back again where they were before the war. Q. Plate glass is mostly imported from Great Britain and France ? — A. Mostly from Belgium and France. The most extensive works are in France. If the present protection is only continued for a few years longer, I think there is no doubt that the American manufacturers will be able to furnish all the glass needed in this country, and at a price much cheaper than it can be furnished from Europe. That time has not arrived, but I think it will come soon. Plate glass is quite dif- ferent from sheet glass. In sheet glass there are uniform sizes, but that is not the case with plate glass because there are no two windows in different buildings where plate glass is used, that are uniformly alike. Besides, the expense and risk of handling the plate glass is greater. It frequently comes in sizes of 10 by 12 or 15 feet, and there is great risk of breakage, and men are often dangerously injured by unavoidable accidents occurring in the handling of such large pieces of brittle mate- rial. There is also quite a waste in the cutting of it. These are a few of the reasons, I believe, why we are entitled to the protection we ask. Q. Owing to the extraordinary difficulty of making this glass, is it not a fact that its manufacture must be carried on upon a large scale ? — A. Yes, sir. The French Government not only protects its manufact- urers of plate glass by a protective duty, but it gave them a subsidy for years until the manufacture was firmly established. We do not ask for any such subsidy in this country ; all we ask is for a reasonable protection. It has been stated that the duty on plate glass is equal to 100 per cent. That is not in accordance with the facts. It varies, ac- cording to the size of the plate, from 2J cents a square foot up to 50 cents a square foot. From statistics furnished by Mr. Mm mo it is shown that from 1870 to 1881, covering a period of from ten to twelve years, there were twenty-six million dollars’ worth of plate glass im- ported, on which there was a duty paid of thirteen million dollars, show- ing that the average duty of those years was about 50 per cent., while the average rate of duty on all articles running through the tariff* is about 35 per cent. Here is a young industry which may be regarded a training school, and although it is a luxury in one sense, and not a necessity, yet I think it is an industry that the people of the country are willing to protect when, as the figures show, the cost per capita is less than 2 cents. W T e 1188 TARIFF COMMISSION. fE. A. HITCHCOCK. have spent thousands of dollars in bringing shilled workmen from Europe to this country, and we desire now to train our American boys and educate them so that when these other factories get to work they will be able to draw upon this supply of skilled workmen without having to send abroad for them. By Commissioner Botelek : Q. What amount of capital is invested in this country in the manu- facture of plate glass? — A. 1 think, now, about two and a half to three million dollars. I am glad you asked that question, because I can tell you what the experience of our own factory has been. I took charge of it in 1875. It had been started by Mr. Ward at Detroit because of the large deposit of sand which was obtained near the factory. About $500,00*0 was invested in the business. That company failed and was sold out, and a company was reorganized, and the capital invested now represents about a million dollars. We expect to put in half as much more before we can reach that degree of profit which will put us in the condition of a regular paying business. We made 7 per cent, last year as the result of seven years’ work, or at the rate of 1 per cent, per an- num. I merely state these facts in reply to the absurd stories which have been circulated in regard to the enormous profits connected with the manufacture. Q. What number of operatives do you employ? — A. We own about 700 acres of land, upon which we have erected houses for our opera- tives, and we have quite a little village. We do notallow any liquor to be sold in the village, and we control all those matters ourselves. We have about 500 operatives and a population of about 1,200 people in the village. We believe that we are doing a good work for the peo- ple themselves while we are trying to make money for our stockholders. Q. About what number of operatives are employed in this manufact- ure throughout the country? — A. I suppose about 1,500 to 2,000 opera- tives are engaged in the manufacture of plate glass. This is a new in- dustry, which looks small compared with other industries. By Commissioner Oliver : Q. When did you establish your steel works here ? — A. About seven or eight years ago. It developed first into a furnace, then into an iron mill, and then into a steel-rail mill. Q. Has your investment been remunerative? — A. No, sir; it has not been remunerative. The works at one time failed and had to be re- organized. During the latter part of last year they were reorganized on the basis of consolidation, taking in the whole property. Q. Do the peojile of this section generally believe the location a good one for manufacturing steel rails? — A. Yes, sir; provided the duty is not reduced to such an extent as to let the foreign rails come into Gal- veston, New Oi leans, and other places in the Southwest. If they do, it will place us at a very great disadvantage. By Commissioner McMahon : Q. I understand you to recommend that the duties on plate glass shall remain as they are ? — A. Yes, sir. Q. I believe there are some 37 rates of duties on glass ; are all those different rates of duties necessary, or can you suggest any way of sim- plifying them? — A. No, sir, I cannot. Ido not think the duties should be changed at all. It is not fair to charge the same rate on small glass as it is on large plates. E. A. HITCHCOCK.] STEEL AND GLASS. 1189 By Commissioner Boteler : Q. The duties vary according to the size of the plate? — A. Yes, sir. Of course on the large plates the risk is greater, and that fact was con- sidered by the glass-men in developing a scale varying according to the size of the plate. By Commissioner McMahon : Q. Are not the prices of plate glass so well known that there would be little or no danger of undervaluation if the rate were ad valorem instead of specific, or is the contrary the fact ? — A. I think it would be a great mistake to change the duty from a specific to an ad valorem one, and that it would open the door to undervaluations. Q. You regard the present complicated system, then, as a necessity, do you? — A. Yes, sir; those practically eugaged in the business find rliat there are rarely complications. The glass is all invoiced on the other side, and the sizes are designated, and the schedule shows what the duty is. I have never understood that there was any trouble arising from the classification as to size. The quality is all the same. Q. I have heard it said that it took two or three men three or four days to go over oue invoice of plate glass. — Q. That may be so in indi- vidual cases where it is necessary to be very particular. The table I have left with you is made up in francs. It was prepared by our man- ager, who was the leading manager in one of the largest English plate- glass factories near London. He was employed by Hr. Siemens for a long time, and in that way he had access to the Belgian and French factories. I will vouch for the correctness of his figures. By Commissioner Porter : Q. When the duty on plate glass was imposed, was it intended for protection ? — A. No, sir ; it was a revenue duty, and was put on before there were any American factories started at all. Q. Is the use of this plate glass increasing in this country ? — A. The demand is growing steadily. I think the ratio is about 25 per cent, per annum. The price has been reduced from $2.50 a foot to $1 a foot as a result of the establishment of these American manufactories. By Commissioner McMahon : Q. I do not understand your last statement, although I believe you made it once before. You say the price is now $1 a foot? — A. Yes, sir ; it averages that; it is much less on smaller sizes. Q. Does the value depend on the size of the plate; when you say it is worth $1 a foot, what do you mean? — A. I mean that is the average price of it. If we can average during the 12 months of the year $1 a foot for glass, we are entirely satisfied, but before the American fac- tories were started the average price, taking the large and small glass together, was $2.50 a foot. Q. Is that average price the fair test of the prosperity of the in- dustry? — A. I think so. Q. Why would it not, then, be a fair test for the duty — an average rate? — A. I say that the average rate of duty is 50 per cent, ad valorem, but the difficulty would be to fix any scale covering the different sizes to make a fair average. Q. Could you not take the statistics of the custom-houses for the last three or four years and ascertain the average per foot? — A. I do not think you could handle this business the same as some others, because it is in its infancy, and you do not know what the future will develop. 115)0 TARIFF COMMISSION. [E. A. HITCHCOCK. Many houses are now being built where plate glass is being used where formerly only the ordinary glass was used. By the President: Q. What class of people may be considered as the consumers of plate glass? — A. There is no special class, its use is becoming quite general in dwelling-houses, especially in the more expensive class of buildings. Q. But there is a growing demand for it, as 1 understand you, for use in the smaller buildings l — A. Yes, sir,* the price has been reduced so that now it is in demand for smaller buildings as well as those of a more expensive character. The following is the table referred to in my statement: Statement showing the amount paid per month, in francs, to workmen in glass manufactories. Department. Prance, Ger- many, and Belgium. England. United States. Casting department : Founders 225 253 500 Skimmers and teamers 150 196 400 Casters .... 90 135 200 Kiln flrers - ... 95 135 227 Producer flrers 110 140 250 Grinding department : No. J 135 169 375 No. 2 100 146 325 No. 3 80 118 250 Boys - 20 26 100 Smoothing department: No. 1 135 169 350 No. 2 100 116 300 No 3 80 118 250 Boys 20 34 90 Polishing department: No. 1 160 196 400 No. 2 125 157 300 Boys 20 54 125 Cutting room : Chief 130 196 1 500 Assistants 120 169 375 Blockers 70 118 160 Packers 65 135 250 Emery washer ...... ......... 120 225 400 Crocus burner. ....... ..... 120 169 375 Eafiorers _ _ 55 98 150 Bricklay ers 195 398 500 Carpenters 165 198 325 Crystal City, Mo., September 15, 1882. JOSEPH E. WARE. J CLAY. 1191 JOSEPH E. WARE. Saint Louis, Mo., September 18, 1882. Mr. Joseph E. Ware, representing the clay interests of Saint Louis, addressed the Commission as follows : I desire to state that the government several years ago put a duty upon the following kinds of clay, viz., fire-brick ; pipes, common or white clay; pipes, colored clay; pipes, bowls; tiles, draining, paving, and rooting; unwrought pipe or fire clay; China clay or kaoline; clay, pre- pared, and clay resembling kaoline for paper makers. Since the duty was put on the articles named, many people have expended large sums in constructing works in Missouri, Illinois, and many other States of this Union, for the purpose of working fire clays, &e., in various shapes, so that at this time, although the clay business and manufacture is but in its infancy, yet much good has resulted to thousands of the laboring classes of our extended country. From the statistics published, it can be shown that many of the articles named are imported into the United States on a large scale, which, not- withstanding the duty imposed by the general government, gives the importers control of a large portion of the Union. This being a large and extensive country, much of our business has to be done by rail, giving the English, German, and other manufacturers an advantage over us in bringing their goods to our large cities by water, which en- ables them to sell at a less price than we can possibly afford to. If the duty is taken off of the articles named, the European competition will soon run us out, but if the duty is retained, we hope to see manufact- ures from clay increased in nearly every State in the Union. To claim that the future magnitude of the fire-clay feature of their industry is to be great and important is but a logical inference from the vastness of the quantities of clay and coal which the Missouri coal measures contain, the most valuable beds being within this city of Saint Louis, and in proper connection with excellent, workable veins of coal. While expressing regret that circumstances have operated to retard success in the line of white-ware pottery, notwithstanding such a pro- fusion of material therefor, and with choice fuel in the most central point of distribution in this Union, it is pleasing to say that the manu- facture of refractory materials in this State has become well established for its age, and the reputation of the raw, washed, or finished products is all that can be desired ; and by reason of the extent of the business thousands of workmen, with their dependent families, obtain comfort- able livelihood. The capital engaged in this branch of industry is large, and its safety almost entirely depends upon tlie sufficiency of protection given by Congress against the interference of importers of like products from countries where wages are three-fourths lower than those paid in Amer- ica. With the skill and expertness of the present day, and the mechanical facilities adapted to the work, the losses of the experimental stage have nearly ceased, and in the line of present production, embracing silica, brick, washed and burnt clay, tiles, chimney-pots, sewer-pipes, fire bricks, gas-retorts, glass pots, &c., there is a widening field of consump- 1192 TARIFF COMMISSION. [JOSEPH E. WAKE. tion with a fairly -earned reputation. Heretofore no unfriendly or un- fair means have been practiced to the disparagement of others ; even foreign competitors have found only fair treatment. But to be able to continue to advance as we think the trade invites us, tampering with established principles and guarantees for protection should not be attempted so long as the present disparity in workmen’s wages exists between this country and Europe. With the tariff as now rated and under which classifications are ar- ranged we are generally satisfied, excepting that the ad valorem duties upon manufactured articles of our line, and certain articles which are clearly part manufactured goods, there is opportunity, we think, for the introduction of, say, for instance, fire-brick, at less duty by two-thirds than the duty that would be collected on the raw clay entering therein. One thousand pressed fire-brick weighs over 3 tons — say 3 tons. Into the composition of 1,000 such bricks there enter 2 tons of clay and at least 1 ton of grog or silica. The duty on 3 tons of raw foreign mate- rial thus used, at $5 a ton, is $15, while upon a thousand of foreign-made brick, even if valued at the price of Saint-Louis-made fire-brick, the ad valorem duty of 20 per cent, is but $5. Therefore, through this ine- quality of duty, for every 1,000 fire-brick which an importer brings in, there is a gain of $10 in the 3 tons of clay which are in the manufact- ured condition. Nearly the same inequality affects gas-retorts and glass pots, &c., at 25 per cent. By putting such articles under the head “other earthen, stone, or crockery ware,” w hich are rated at 40 per cent., the equalization will be nearly fair. We would also request that the duty on such part-manufactured articles as burnt or washed clay be placed at $7 per ton. This arrangement will correct the appa- rent oversight and a great inequality be obliterated. We therefore respectfully ask favorable action on these important points. The importation of foreign clay into the United States increases. During the fiscal years 1879, 1880, and 1881, the quantity of clay im- ported of the sorts mentioned was 53,943 tons; the values and duty paid thereon show that $5 a ton was the assessed value; as instance the imports for 1881 as a ratio for previous years, being 19,598 tons, with duties $97,468.98, on a total valuation or $193,405.98. The disproportion between the wages of clay miners and workers in Europe and the United States is so great that any lowering of the duty of $5 a ton on unwrought clay will be detrimental to the interest of the industry at large and a lessening of the earnings and comforts of the wmrkmen. We respectfully solicit the privilege to stand on record as unfavorable to any lowering change in the duty on strictly raw clays, and ask atten- tion to the inequality and low classification of certain other articles which are shown. This statement of our case has been signed by eight firms in this city, viz, Messrs. Evans & Howard; Christy Fire-Clay Company; Parker, Bussell & Co.; S. Mitchell & Sons; Saint Louis Stone- Ware Company; Laclede Fire-Brick Manufacturing Company; Missouri Fire-Brick Com- pany ; Charles E. Bradley & Co. We call your especial attention to the facts presented. DAVID H. MASON.] SALT. 1193 DAVID n. MASON. Saint Louis, Mo., September 18, 1882. Mr. David H. Mason, of Chicago, 111., representing the Michigan Salt Association, addressed the Commission as follows : Mr. President and Gentlemen of the Commission: Those who are hostile to the continuance of the duties on salt have spread so many misrepresentations and absolutely false statements about the salt in- dustry in the United States, that an impression has been created on the uninformed public mind that excessive, and even enormous, protection has been granted in the tariff to the manufacturers. On the contrary, adequate defense against encroachment from foreign competition has not been granted by Congress, at any time, from the beginning of the Union until now. Even the highest duty was , symbolically , no more than a three-rail fence around a farm ; sufficient to mark the boundary line, but not enough to keep out trespassers. For instance, when, in 1813 to 1830, the duty ou imported salt was 20 cents per bushel, and when the bulk of our domestic supply was derived from the saline resources in New York, that State levied a home tax of 12J cents per bushel for the .use of the brine. Deducting that tax from the import duty, only 7 J cents a bushel was left to represent whatever there was of protective force in the tariff, reckoned as a net influence. As, in those days, the prices of both American and foreign salt fluctuated in our market, one year with another, more than 7J cents per bushel, the duty was, in its shield- ing effect, our typical three-rail fence. In 1830 the duty was reduced to 15 cents per bushel, leaving to be falsely called protection only 2 J cents above the State tax. In 1832 the duty was further reduced to 10 cents per bushel, but the local tax of New York remained unchanged. Then our home producers had to meet foreign competition in their native market under a clear disadvantage of 2^ cents per bushel, which was a legisla- tive discrimination against them to that amount. In 1834 the State tax was reduced to 0 cents; but the duty, under the compromise measure of 1833, going into effect January 1, 1834, had fallen by that time to 9.4 cents per bushel. The difference of 3.4 cents was not in any sense a protection to the New York manufacturers against foreign aggression. 4>y 1841, under the sliding scale of tariff* reductions, jieriodically declin- ing toward 20 percent, ad valorem, as the highest rate finally allowable, as provided for in the compromise measure aforesaid, the import duty had further fallen 7.6 cents per bushel, or to an amount only 1.6 cents above the State tax. Next came the high protective tariff of 1842, which, however, omitted to protect salt, the rate levied on the imported article being only 8 cents per bushel, while the State tax continued at 6 cents, leaving only 2 cents as a margin for protection. After four and one-third years under the duty of 8 cents, followed the tariff* of 1846, going into effect December 1 of the same year, and fixing the duty ou salt at 20 per cent, ad valorem, equal, during the period of its continuance to a specific rate of only 2.43 cents per bushel on a gen- eral average. Almost simultaneously with this reduction of the import charge, New York reduced her tax to 1 cent per bushel, at which figure it has remained ever since; consequently, so long as the tariff* of 1846 was in force, or 10 years and 7 months, the New York manufacturers, who then produced the bulk of our domestic salt, had only the mockery 1194 TARIFF COMMISSION, [DAVID H. MASON. of protection contained in the excess of 1.43 cents of import duty over the State tax. Then came the act of 1857 further diminishing the tariff rate to 15 per cent, ad valorem. This rate lasted three years and nine months. Taking the average for that time, it was equivalent to a specific duty of 1.58 cents per bushel, leaving for protection, if any- body can venture to call it such, not quite three-fifths of a cent per bushel after the amount of the State tax was deducted. The act of March 2, 1861, going into effect April 1 following, created, for the first time, a distinction in the tariff between salt in packages and salt in bulk, imposing on the former a duty of 6 cents per 100 pounds, equal to 3.36 cents per standard bushel of 56 pounds, and on the latter a duty of 4 cents per 100 pounds, equal to 2.24 cents per standard bushel. By the act of August 5, 1861, going into effect from and after its pas- sage, these rates were respectively increased to 18 and 12 cents per 100 pounds, relatively equal to 10.08 cents and 6.72 cents per bushel. By the act of July 14, 1862, going into effect August 1 following, the duties were further raised to 24 cents per 100 pounds in packages, equal to 13.44 cents per bushel, and to 18 cents per 100 pounds in bulk, equal to 10.08 cents per bushel. Here was a greater reach toward tariff pro- tection to salt than ever before in our history. But the duties were di- rectly negatived in part by the internal-revenue tax of 4 cents per 100 pounds of home-made salt. By the act of June 6, 1872, going into effect August 1 following, the duties on salt were reduced to 12 cents per 100 pounds in packages, equal to 6.72 cents per bushel, and to 8 cents per 100 pounds in bulk, equal to 4.48 cents per bushel. Since then these rates have remained unchanged. From that date, with much injury to such part of the home industry as is most exposed to foreign encroachment, and with strained competition imposed upon the other part, the importations have been on the increase, mainly from England. In fiscal year 1881 these imports amounted to 1,100,510,401 pounds, equal to 10,651,971 standard bushels, being a quantity far greater than ever before in our history, in any one year. Considering that the manufacture of salt in the United States never has been granted more than incidental protection, that an immense capital is invested in the business, and that competition from abroad is becoming sharper, we submit that any reduction of the duties at this time would be both impolitic and unjust. WHY THE AMERICAN SALT INDUSTRY IS NOT MORE WIDELY DE- VELOPED. The resources of the United States for the manufacture of salt are both inexhaustible and generally diffused. This industry might flourish in the South no less than in the North, the whole people in both sections being amply and cheaply supplied with the home product ; but the con- ditions of the business are such as to warn capitalists against venturing their money. When, during the war, the South was driven by the blockades other ports to seek salt from. her own territory, three thou- sand men were employed at Grand Saline, in Texas, in making this es- sential article. Their process and appliances were of the crudest, hum- blest, and cheapest description ; yet the brine there, which is better than that in Michigan, although the latter is exceptionally good, was so free from natural impurities that the salt produced was of excellent quality. So soon, however, as peace came, foreign salt poured in and destroyed the incipient manufacture at Grand Saline. 1 u Louisiana there are immense beds of mineral salt, lying near the surface, and of remarkably good DAVID H. MASON.] SALT. 1195 quality ; but these resources must remain a buried treasure, reserved for future generations, unless such a change takes place in the circum- stances of foreign competition as will safely warrant the large expend- iture for machinery and other accessories requisite to make the salines available as a productive investment. Many cargoes of salt are sent to this country in ballast, so that in these cases the cost of ocean trans- portation is wiped out, and the alien producer is virtually located at the landings in our harbors. As regards the salt industry, many bitter experiences have taught the lesson of caution. The shores of the past in this business are dotted with wrecks. There is always the danger ahead of free trade in salt, or a ruinous reduction of the duties, and those who otherwise would embark their capital in developing the saline resources in various parts of the United States are withheld by the fear and risk of unfriendly legislation. Trained salt makers have looked over the ground in the South, and have admired the remarkable natural capacity of that sec- tion for the manufacture, but they have gone away with the firm con- viction that the hazard to investments, in the present state of foreign competition, far outbalances the local advantages. If a sufficiently protective tariff on salt could be assured for one or two decades, the salines of the South, as well as of the West, would be quickly utilized, and only a few years would elapse before the home-made salt would be so abundant as to crowd out the foreign article, as to cheapen the price beyond precedent in our market, and as to create a surplus which would be exported. Had it not be^n for the wise policy adopted by the State government of Michigan, the probability is that the saline resources there would have been very scantily developed, if at all, to-day; for the tariff has not afforded such a measure of protection as, in itself, to set on foot the many works now in operation. The legislature of 1S59, for the pur- pose of inducing capitalists to embark in the manufacture of salt, passed a law declaring that there should be paid trom the State treasury, as a bounty , to every individual, company, or corporation, on and after pro- ducing 5,000 bushels of salt, the sum of ten cents for each and every b ushel of salt manufactured under the act from water obtained by boring wells in Michigan. At once capital rushed into the business. The tariff on imported salt was then 15 per cent, ad valorem, equal to an average specific rate of scarcely 1.6 cents per bushel, warning rather than en- couraging capitalists to invest their means in making salt; but the separate and independent action by the State of Michigan in behalf of the development of its own salines produced an immediate impulse toward the manufacture. When the census of 1860 was taken, 2,360 bushels had been realized, as a beginning, by works which had been in operation only ten days. Last inspection year, ending November 30, 1881, the production amounted to 13,751,495 bushels. The quality of this salt ranks second to none in this or any other country. But for this timely and wise legislation on the part of the State, the prices of salt, under the disturbing influences of our civil war, must have gone much higher than the figures actually reached. By so con- siderable an increase of the home supply, in an entirely new quarter, as soon took place, the upward movement of prices was restrained and the consumer benefited. It is true that the said law did not long re- main upon the Michigan statute book, for its continuance to date would have bankrupted the State treasury ; but it undoubtedly was the parent cause of the extraordinary development of the salt resources, which is now expanding so rapidly. A like experiment in the South would be apt to lead to a like result there. 1196 TARIFF COMMISSION. [DAVID H. MASON. EXTENT OF THE FOREIGN COMPETITION WHICH WE ENCOUNTER. It has been charged by speakers and writers, in every form of repeti- tion, that the salt manufacturers possess a monopoly, and that the duties on salt are so excessively high as to amount to virtual prohibi- tion. The utter falsity of these allegations can be seen in the statis- tics of imported salt given below, covering a long series of fiscal years, the pounds in the official reports being reduced to equivalent bushels of 5(3 pounds each, as more in accord with the commercial usage in this country. Import entries of salt under the duty of 24 cents per 100 pounds in packages , and 18 cents per l00 pounds in bulk. Years ending June 30 — Bushels. Invoice values. Average per bushel. 1863 10, 800, 189 8, 126, 565 7, 319, 092fJ 11,411,780#* 8, 534, 268f g 11, 134, 495i§ 10, 574, 794 13, 340, 2583-| 11, 388, 440/ s 11, 032, 226# g 723, 277-ff $1, 021, 550 812 651 758, 467 1, 093, 900 1, 019, 596 1, 383, 087 1, 268, 891 1, 442, 835 1,254,001 1,214,747 61, 865 $0 09. 459 10. 000 10. 363 09. 586 11. 947 12. 422 11. 999 10. 816 11. Oil 11.011 08. 553 1864 1865 1866 1868 1869 1870 1871 1872 July 1872 Totals - 104, 385, 387|g 10, 352, 270 11, 331, 590 1, 123, 794 0 10. 856 Annual average Import entries of salt under the duty of 12 cents per 100 pounds in packages , and of 8 cents per 100 pounds in bulk. Years ending June 30 — Bushels. Invoice values. ! Average per busheL 11 months 1873 * . . ................... 13, 174, 469| | 16, 595, 9563g 14, 735, 320£§ 15, 483, 703fg 16, 093, 033|| 15, 367, 6644 g 16, 189, 559 S 8 S 17, 213, 762-lf 19, 651, 971f § 15, 103, 141H $1, 721, 319 2,339,311 1, *07, 587 1, 773, 445 1, 659, 521 1,632,865 $0 13. 066 14. 096 ]874 1875 12. 267 1876 11. 454 1877 10. 312 1878 10. 625 1879 1,776,741 10. 975 1880 1,837,432 ! 10. 674 1881 2,090,578 1, 673, 515 10. 638 1882 11. 081 Totals ................. ...... 159, 608, 5c4# s 16, 115, 050 18,312,314 | 0 11. 473 Annual average .......... ............ ........... 1, 846, 620 * July, 1872, the first month of fiscal year 1873, was nnder the higher duties. These two comparative tables tell an unvarnished tale of the extent of the foreign competition which we have to encounter in our home market. Alter the reduction of the duties in 1872, the importations at once rose, freshet-like, and never since in anj T one year have fallen so low as the highest quantity imported under the previous duties ; for- eigners now furnish several millions more bushels of salt to consumers in the United States than were requisite for the entire home supply forty- two years ago, and in fiscal year 1881 within 1,33G,054 bushels of as much as was requisite for the entire home supply thirty-two years ago. Such a state of things evidences the exact contrary of monopoly and of prohibitory duties. A monopoly of the salt manufacture would not DAVID H. MASON.] SALT. 1197 be possible. STo considerable portion of this country is destitute of the crude material of salt. These native resources need only proper devel- opment to be able to supply the whole United States for a period of time beyond which human calculations do not extend. The present salt manu- facturers could not by any possibility own or control these enormous, inexhaustible, widespread, various resources. If it is true, as it is rep- resented to be, and as it has been represented in many newspapers, that exorbitant profits are made in the business, why do not American capital- ists hasten to enter such an alluring field of investment which promises such rich returns f Still, we do not see any rush to be first in securing the glittering prize in the wheel of fortune as is always the case when large profits are certain. Were the fact as alleged, the home production of salt would soon be on such an extensive scale as to leave no room for a single bushel of the imported article. Almost every element of cost in production, particularly wages, which embody the bulk of the cost, is far higher in the United States than in England, tbe chief source of our imported salt. Any lowering of the present tariff would place us at a still greater disadvantage as regards the foreign competition which we are compelled to encounter upon our own soils. PROGRESS AND VICISSITUDES OF THE SALT INDUSTRY. A retrospect of the salt industry in the United States, covering six census periods, will exhibit in a full and clear light the fact that tbe home manufacture little more than kept pace with the numerical ad- vance of the country, while the supply from abroad rapidly increased per capita, until the inauguration of the protective system in 1861 , since which date the development has been at a rate much faster than that of population. The growth of domestic production, of importation, and of home consumption, at decennial periods, contrasted, is given in the following tables: YEAR 1830. Source of supply. Year ended — Bushels. Values. Average per bushel. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Domestic salt retained May 31 Sept. 30 Sept. 30 Sept 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 4, 444, 929 47, 488 $935, 173 22, 978 $0 21. 039 48. 387 4, 397, 441 912, 195 20. 744 5, 374, 046 101, 866 671, 979 20, 064 12. 504 19. 696 5, 272, 180 651, 915 12. 365 4, 397, 441 5, 272, 180 912, 195 651, 915 Foreign salt retained Total retained ... 9, 669, 621 1, 564, 110 1198 TARIFF COMMISSION. [david h. mason- TEAR 1840. Source of supply. Tear ended — Bushels. Values. Average per bushel. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Domestic salt retained - . May 31 Sept, 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 Sept. 30 6, 179, 174 92, 145 $1, 235, 835 42, 246 $0 20. 000 45. 847 6, 087, 029 1,193,589 19. 609 8, 183, 203 31, 999 1, 015, 426 11, 524 12. 409 36. 017 8, 151, 204 1,003,901 12. 316 6, 087, 029 8, 151, 204 1, 193, 589 1, 003, 901 Foreign salt retained Total retained ...... 14, 238, 233 2, 197, 490 TEAR 1850. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Domestic salt retained ... May 31 June 30 June 30 June 30 June 30 June 30 June 30 June 30 9, 763, 840 319, 175 $2, 222, 745 75, 103 $0 22. 765 23. 530 9, 444, 665 2, 147, 642 22. 739 11, 224, 185 31, 046 1, 237, 186 9, 668 11. 023 31. 141 11, 193, 139 1, 227, 518 10. 969 9, 444, 665 11,193,139 2, 147, 642 1, 227, 518 Foreign salt retained Total retained 20, 637, 804 3, 375, 160 TEAR 1860. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Domestic salt retained May 31 June 30 June 30 June 30 June 30 June 30 June 30 June 30 12,717,198 475, 445 | $2, 289, 504 129, 717 $0 18. 003 ' 27. 283 12,241,753 1 2, 159, 787 17. 643 14, 094, 227 126, 167 1,431,140 28, 933 0 10. 154 22. 932 13, 9G8, 060 1, 402, 207 10. 039 12, 241, 753 13, 968, 060 2, 159, 787 1, 402, 207 Foreign salt retained Total retained 26, 209, 813 3, 561, 994 TEAR 1870. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Domestic salt retained Foreign salt retained Total retained May 31 June 30 17, 606, 105 298, 142 $4, 818, 229 119, 582 $0 27. 838 40. 109 June 30 17, 307, 963 4, 698, 647 27. 147 June 30 June 39 13, 340, 25 234, 780| g 1, 442, 835 42, 714 10. 816 18. 193 June 30 13, 105, 477gg 1, 400, 121 10. 683 June 30 Juno 30 17, 307, 963 13, 105, 477gg 4, 698, 647 1, 400, 121 30, 413, 440gg 6, 098, 768 Average prices of imported salt per bushel are those in the foreign ports of departure. DAVID H. MASON.] SALT. 1199 YEAR 1880. Source of supply. Year ended — Bushels. Values. Average per bushel. Produced in United States Exports of domestic salt Retained in United States Imported into United States* Exports of foreign salt Retained in United States Tlnmeatie an It, retained May 31 June 30 June 30 June 30 June 30 June 30 June 30 June 30 29, 800, 298 22, 179 $4, 817, 636 6 , 613 $0 16. 502 29. 816 29, 778, 119 4, 811, 023 16. 156 17, 213, 762ft 118, 399ft 1, 837, 432 8 , 861 10. 674 7.484 17, 095, 363»f 1,828, 571 10. 696 29,778,119 17, 095, 363^1 4, 8 1 1,023 1, 8 ^ 8 , 571 Foreign salt retained ................. Total retained 46, 873,482ff 6 , 639, 594 * Average prices of imported salt per bushel are those in the foreign ports of departure. Let it be noticed, contrasting one decennial date witli another, that the average census value per bushel of home-made salt has declined largely in the end, though in a fluctuating way, the fall between 1830 and 1880 amounting to 4.537 cents, that representing the movement toward greater cheapness of product realized by the American salt manufacturers after half a century of vicissitudes without merited pro- tection in the tariff. The exceptionally high home price in 1870 was 'due to the inflation of nearly all prices left as a heritage from our civil war, a range of dearness which involved all the elements of cost in pro- duction, and swelled the outlay at every step and turn of the business. These profoundly disturbing influences were swept away by the panic of 1873, aud by the subsequent loug period of hard times. Industry has been adjusted to the altered conditions, and the natural tendency of price of salt to the minimum consistent with fair profit may be ex- pected to continue, unless interrupted by unfriendly legislation, as the industrial surroundings are favorable to such a result. Let it be also noticed that the average foreign invoice value jier bushel of salt had declined only a trifle at the end of fifty years, the value having been 113.504 cents in 1830, and 10.684 cents in 1880, a de- crease of no more than 1.83 cents per bushel, or 2.707 cents less than the fall in the price of domestic salt in the same time. Indeed, the average foreign invoice value was 10.151 cents per bushel in 1860, or fifty-two hundredths of a cent less than in 1880, so that w r e are paying foreign producers a higher average price than w r e did twenty two years ago. Any further cheapness of salt, as regards permanency, must, consequently, be looked for in the circumstances v 7 hich will accompany a greater development of the home manufacture, which, with every passing year, is becoming more scientific, more economic, and, in the aggregate, more productive. The proportion which the home supply has borne to the foreign and to the total supply retained for consumption, is presented in the fol- lowing series of comparative exhibits : 1200 TARIFF COMMISSION. [DAVID H. MASON. Retained salt measured per capita. Year. Source of supply. Pounds. 1 Census population. Pounds per capita. 1830 246, 256, 696 295,242,080 12, 806, 020 12,866,020 19. 1401 22. 9474 1830 1840 541, 498, 776 12, 866, 020 42. 0875 340, 873, 624 456, 467, 424 17, 069, 453 17, 069, 453 19. 9698 26. 7418 1840 1850 Total salt retained 797, 341,048 17, 069, 453 46.7116 Domestic salt retained 52 ,901,240 626, 815, 784 23, 191,876 23, 191, 876 22. 8054 27. 0274 1850 . Foreign salt retained I860 Total salt retained 1, 155, 717, 024 23,191,876 ! 49. 8328 Domestic salt retained 685, 538, 168 782,211,360 31, 443, 321 31, 443, 321 21. > 023 24. 8769 I860 Foreign salt retained Total salt retained 1, 467, 749, 528 31,443, 321 46. 6792 1870 Domestic salt retained 969, 245, 928 733, 906, 752 38, 558, 371 38, 558, 371 25. 1371 19. 0337 1870 Foreign salt retained 1880 Total salt retained 1, 703, 152, 680 38, 558, 371 44. 1708 Domestic salt retained ...... 1, 667, 574, 664 957, 340, 341 50, 155, 783 50, 155, 783 33. 2479 19. 0873 1880 Foreign salt retained Total salt retained ........ 2, 624, 915, 005 50, 155, 783 52. 3352 Here it appears that the supply of domestic salt increased 14.1078 pounds per capita, or 73.708 per cent.; that the supply of foreign salt diminished 3.8601 pounds per capita, or 20.223 per cent. ; and that the total supply of salt augmented 10.2477 pounds per capita, or 24.349 per cent., in the fifty years between 1830 and 1880. In 1830 the supply of for- eign salt was 3.8073 pounds per capita in excess of the domestic; in 1840 this excess had grown to 6.772 pounds; in 1850 it had declined to an excess of 4.222 pounds ; and, in 1860 it had further declined to an excess of 3.0746 pounds ; but, in 1870, the supply of domestic salt was 6.1034 pounds per capita in excess of the foreign ; and, in 1880, this domestic excess had increased to 14.1606 pounds. At the close of the half cen- tury the source of supply had been almost exactly reversed, the domestic manufacturers furnishing 19.1401 pounds per capita in 1830, and the for- eigners 19.0873 pounds in 1880. The total supply of salt was 3.1536 pounds less per capita in 1860 than it was in 1850. In 1870 the total supply of salt had further diminished 2.5084 pounds per capita. Let it be observed in this case that the domestic supply had increased 3.3348 pounds per capita, while the foreign supply had declined 5.8432 pounds per capita, compared with the quantities in 1860. It is apparent, therefore, that the shrinkage in aggregate supply was not due to the shrinkage in the domestic production, for that ex- ceeded all precedent. The true reason of decrease is to be found in the fact that the South, which had always depended mainly on foreign salt for its consumption, had been impoverished by the recent civil war, and was forced to pinched economy in all directions, so that the people in that section did not take salt from abroad to their former extent. Thus, in the fiscal year ended June 30, 1860, the importation of salt at Southern jiorts amouuted to 7,447,147 bushels; but, in the fiscal year ended June 30, 1870, to only 3,959,372 bushels. The difference between the importations in these two years is 3,487,775 bushels, and this quan- tity, distributed equally among all the inhabitants in all the Southern DAVID II. MASON.] SALT. 1201 States, as enumerated in the census of 1870, amounts to 14.537 pounds per capita, or distributed equally among all the people in the United States in L870 amounts to 5.0054 pounds per capita, which is not much less than the decline pointed out in the supply of foreign salt for the whole country. As, however, the South recuperated its resources, it took more foreign salt, the quantity imported at Southern ports in the fiscal year ending June 30, 1880, amounting to 5,034,877 bushels. This was In addition to domestic salt, which now finds a constantly enlarging consumption in some parts of the South. Attention is invited to the fact that the per capita supply of foreign salt in 1880 was very little greater than in 1870, showing an almost sta- tionary ratio of the foreign supply in the American market, the domes- tic supply meanwhile advancing by strides. This proportionate condi- tion of the supply, so favorable to the domestic manufacture, is the real reason which prompts the incessant attacks against the tariff on salt. Those persons, whether at home or abroad, who are directly in- terested in importations into the United States, have been diligent in seeking either repeal or reduction of the duties on salt, as a means of obtaining easier and larger access for the foreign article, to the decrease of the national revenue and to the injury of the native industry; this,, too, when the only reasonable hope of cheaper salt appears in the ex- pansion and improvement of the domestic supply. If any change at all is to be made in the tariff on salt, it should be in the direction of the protective policy, because that policy, while minimizing the destruc- tive manifestations of foreign rivalry, secures the maximum amount of wholesome competition; for, if the tariff be too much reduced, foreign competition, flooding according to its own pleasure, will iirostrate and ruin our home establishments, whereupon all the competition left will be that between foreigners for the possession of our market; but, on again raising the tariff barrier to the protective point, domestic industry will revive, and competition be increased by that between our domestic producers, and by that between them and their foreign rivals, thus in- suring a threefold competition, moving in legitimate channels, and act- ing with the maximum of combined force to cheapen prices to consum- ers. Considering that the salt manufacturers have, at this time, little more than the incidental protection involved in the general prosperity due to the protection granted to a wide range of other industries, by which the productive and purchasing powers of the toiling millions have been greatly increased, any reduction of the duties on salt would be a damaging blow at competition, and, through that, at the future cheap- ness of this indispensable article. GROWTH OF THE MICHIGAN SALT MANUFACTURE. To the rapid development of the saline resources in Michigan is due the unprecedented increase which has taken place in the total per cap- ita supply of domestic salt since 1860. This noteworthy fact is clearly established by the statistical exhibit which follows : H. Miss 76 1202 TARIFF COMMISSION. [DAVID H. MASON. Domestic salt production — Detailed total product in census years. Year. Sources of supply. 1860. 1860. 1860. 1860. 1860 Salt production in New York Salt production in Virginia and West Virginia Salt production in Ohio Salt production in Michigan Salt production in all other parts of United States . . Total 1870. 1870 1870. 1870 1870. Salt production in New York Salt production in Virginia and West Virginia Salt production in Ohio Salt production in Michigan Salt production in all other parts of United States . - Total 1880. 1880 1880. 1880 1880. Salt, production in New York Salt production in Virginia and West Virginia . . Salt production in Ohio Salt production in Michigan Salt production in all other parts of United States . Total Pounds. Census population. Pounds per capita. 421, 194, 760 31, 443, 321 13. 3954 116, 284, 728 31, 443, 321 3. 6982 97, 619, 200 31, 443, 321 3. 1046 132, 160 31,443,821 .004T 76, 932, 240 31, 443, 321 2. 4467 712, 163, 088 31,443,321 22. 6491 278, 752, 320 38, 558, 371 T. 2293 259, 605, 528 38, 558, 371 6. 7328 162, 324, 344 38, 558, 371 4. 2098 222, 953, 696 38, 558, 371 5. 7823 62, 305, 992 38, 558, 371 1. 6159 985, 941, 880 38, 558, 371 25. 5701 489, 899, 368 50, 155, 783 9. 7674 173, 898, 648 50, 155, 783 3. 4672 148, 416, 856 50, 155, 783 2. 9591 695, 849, 560 50, 155, 783 13. 8738 160, 752, 256 50, 155, 783 3. 2051 1, 668, 816, 688 50, 15i>, 783 33. 2726 Let it be noticed that at every specified source of supply except Mich- igan the quantity of salt produced in 1860 either suffered a dec line in 1870 and then an increase in 1880, or else augmented in 1870 and de- clined in 1880 ; and that it afforded a lower — sometimes a much lower — per capita amount in 1880 than in 1860, save the aggregate produced in the scattered parts of the Union, where the manufacture, in each indi- vidual case, is on a small scale. Only in Michigan has there been, during the past twenty-two years, anything like a steady and large in- crease of product. In inspection year ended November 30, 1881, the quantity of salt produced exceeded the quantity produced in census year 1880 by 1,325,610 bushels, and the quantity in the present inspection year promises to be greater still. The detailed statement given below shows the very rapid growth of the manufacture. Total annual salt production in Michigan measured per capita. Years. Barrels. Equivalent bushels. Equivalent pounds. Population June 1, each year. Pounds per capita. 1860 4, 000 20, 000 1, 120, 000 31, 443, 321 . 03562 1861 125, 000 625, 000 35, 000, 000 32, 064, 000 1. 09157 1862 243, 000 1, 215, 000 68, 040, 000 32, 704, 000 2. 08048 1863 466, 356 2, 331, 780 130, 579, 680 33, 365, 000 3. 91367 1864 529, 073 2, 645, 365 148, 140, 440 34, 046, 000 4. 35118 1865 477, 200 2, 386, 000 133, 616, 000 34, 748, 000 3. 84529 1866 407, 077 2, 035, 385 113, 981,560 35, 469, 000 3. 21355 1867 474, 721 2, 373, 605 132, 921, 880 36,211,000 3. 67076 1868 555, 690 2, 778, 450 155, 593, 200 36, 973, 000 4. 20829 1869 561, 288 2, 806, 440 157, 160, 640 37, 756, 000 4. 16253 1870 621, 352 3, 106, 760 173, 978, 560 38, 558, 371 4. 51283 1871 728, 175 3, 640, 875 203, 889, 000 39, 555, 000 5. 15457 1872 724, 481 3, 622, 405 202, 854, 680 40, 604, 000 4. 99593 1873 823, 346 4,116,730 230, 536, 880 41,704,000 5. 52793 1874 1, 026, 979 5, 134, 895 287, 554, 120 42, 856, 000 6. 70978 1875 1,081, 865 5, 409, 325 302, 922, 200 44, 060, 000 6. 87528 1876 1, 462, 729 7, 313, 645 409, 564, 120 45,316,000 9. 03796 1877 1, 660, 997 8, 304, 985 465, 079, 160 46,624,000 ! 9. 97510 1878 1, 855, 884 9, 279, 420 519, 647, 520 47, 983, 000 10. 82983 1879 2, 058, 040 10, 290, 200 576, 251, 200 49, 395, 000 11.66618 1880 2, 676, 588 13, 382, 940 749, 444, 640 50, 155, 783 14. 94234 1881 , 2, 750, 299 13, 751, 495 770, 083, 720 51, 402, 000 14. 96412 Total 21, 314, 140 106, 570, 700 5, 967, 959, 200 883, 052, 475 6. 75833 Note. — State inspection of salt in Michigan began with 1869, the inspection year ending November 30. The statement of population for 1860, 1870. and 1880 is by census enumeration, and for the othe. years from estimates prepared by Prof. E. 11. Elliott, of Che Treasury Department of the United Statesr DAVID II. MASON.] SALT. 1203 As the manufacture has expanded improvements in processes have been introduced, experience has been accumulated, greater skill has been ac- quired, and wider markets have been secured, the quality of the salt has become better, and the price at which the product could be afforded has declined. A continuance of this development offers the only solid basis for realizing thepurest article and the utmost cheapness. Dependence upon foreign sources of supply holds out no such promise. These views are made manifest by the following exhibit, in which, for the sake of the com- parison, pounds of salt imported in packages for our home consumption are reduced to equivalent barrels of 280 pounds each, the average foreign invoice value per barrel is calculated, and the annual average price of actual sales of fine salt per barrel, from the Michigan works, during the last fourteen years is given in contrast : Per barrel, prices of imported and of Michigan salt compared. Tear ending June 30 — Pounds re- duced to barrels. Invoice values. Average per barrel. Michigan fine salt, average per barrel. 1868 1, 101, 593 $915,546 51 $0 83. Ill $1 85 1869 1, 062, 081 895, 272 13 84. 294 1 58 1870 1, 030, 283 797, 194 08 77. 376 1 32 1871 1, 014, 264 800, 454 49 78. 920 1 46 1872 922, 260 788, 893 38 85. 539 1 46 1873 1, 212, 479 1,254,817 67 1 03.492 1 37 1874 1, 279, 912 1, 452, 160 74 1 13.458 1 19 1875 1,138,118 1, 200, 541 36 1 05. 485 1 10 1876 1, 183, 093 1, 153, 479 80 97. 497 1 05 1877 1, 282, 163 1,059,941 12 82. 668 85 1878 1, 257, 536 1, 062, 995 47 84. 530 85 1879 1,340, 309 1, 150, 018 49 85. 082 1 03 1880 1, 432, 038 1, 180, 082 42 82. 406 76. 33 1881 1, 473, 008 1, 242, 542 55 84. 354 87. 80 Total 16, 729, 137 14, 953, 940 21 0 89.389 Note. — The prices of imported salt are in fiscal years ending June 30, and of Michigan salt in in- spection years ending November 30. Here it appears that, while the foreign price of imported salt in pack- ages was rapidly advancing, the price of the Michigan article was as rapidly receding. Although the drop in the foreign price, caused by the growth and vigor of our home competition for the possession of the market, has been very marked since 1874, the pressure of American rivalry has apparently brought about the lowest figures likely to be conceded abroad; for these figures stand at very much the same as in 1868 and 1869. Any legislation which would break the growing force of the American competition against the foreigner would be sure to strengthen the latter and enable him to exact higher prices. The tend- ency to cheaper salt, now in operation, can be maintained only by maintaining those circumstances which strengthen the power of Ameri- can competition. The principal reason why the Michigan salt manufacturer has been able to expand so fast, lies in the fact that it is dovetailed with the Michigan lumber interest. These two interests are interdependent, and help each other. By using the waste of saw-logs, including the saw dust for fuel; by working up the best of the slabs into barrel staves and headings, and by utilizing the waste steam of the saw-mills, the salt manufacturers in Michigan have advantages in cheapening the cost of 1204 TARIFF COMMISSION. [DAVID II. MASON. production not possessed by any other part of this country, for nowhere else can the lumber and the salt manufactures be carried on side by side in this manner. But the rapid disappearance of our lumber forests give warning that this peculiar advantage may not be ours for very many more years. When it shall be gone, we shall be more seriously con- fronted by foreign competition than we are to-day, even should the salt duties be undisturbed, and then we may have to surrender one outpost after another in the American market, and retire within narrowing bound- aries before the invading onset of English salt, as is now the case with the salt industry in New York. We submit that, with this contingency in plain sight, nothing should be done by Congress to repress or weaken the progress at present being made by the Michigan manufacture. SALT NOT CHEAPENED BY REDUCING THE DUTIES. A very erroneous belief is prevalant that a reduction of thQ tariff on salt would cheapen the article to consumers, whereas every time in our history when the tariff on salt has been reduced the prices have ad- vanced, except under the tariff of 1857, soon after the passage of which occurred the memorable panic of that year, followed by a heavy decline in the prices of almost every kind of commodities. An instructive lesson may be learned from the last instance. In 1872 Congress reduced from 24 down to 12 cents per 100 pounds the duty on salt in bags, sacks, barrels, or other packages, and from 18 down to 8 cents per 100 pounds on salt in bulk. The following comparative statements, compiled from the statistical record, show that the foreign prices of both classes of salt advanced a considerable part of the duties removed. As salt in packages comprises by far most of the salt manufactured in the United States, that sort is chosen for the purpose of illustration : SALT IMPORTED FOR HOME CONSUMPTION AT DUTY OF 24 CENTS PER 100 POUNDS. Years ending June 30 — Pounds. Foreign invoice values. Invoice val- ues per 100 pounds. • Duty collected. 1868 1869 1870 1871 1872 July, 1872 Totals 308, 446, 080 297, 382, 750 288, 479, 287 283, 993, 799 258, 232, 807 5, 028, 432 $915, 546 51 895, 272 13 797, 194 08 800, 454 49 788, 893 38 16, 022 40 $0 29. 683 30. 105 27. 634 28. 185 30. 549 31. 864 $740, 270 59 713, 718 60 692, 350 31 681, 585 16 619, 758 77 12, 068 23 1, 441, 563, 155 4, 213, 382 99 29. 228 3, 459, 751 66 SALT IMPORTED FOR HOME CONSUMPTION AT DUTY OF 12 CENTS PER 100 POUNDS. 1873* 334, 465, 685 $1, 238, 795 27 $0 37. 038 $401, 358 72 1874 358, 375, 496 1, 452, 160 74 40. 523 430, 050 49 1875 318, 673, 091 1, 200, 541 36 37. 673 382, 407 65 1876 331, 266, 140 1, 153, 479 80 34. 823 397, 519 23 Totals 1, 342, 780,412 5, 044, 977 17 37. 571 1, 611, 336 09 1877 359, 005, 742 1, 059, 941 12 29. 522 430, 806 79 1878 352, 109, 963 1, 062, 995 47 30. 190 422, 531 98 1876 375, 286, 472 1, 150, 018 49 30. 644 450, 343 74 1880 400, 970, 531 1, 180, 082 42 29. 431 481, 164 55 1881 412, 442, 291 1, 242, 542 55 30. 126 494, 930 73 Totals 3, 242, 595, 411 10, 740, 557 22 33. 123 3, 891, 113 88 * Eleven months, from July 31, 1872, to July 1, 1873. DAVID H. MASON.] SALT. 1205 The reduced duty went into operation August 1, 1872. Let it be noticed that the foreign producers, who always take whatever profit circumstances will permit them to get, put up their prices immediately after the passage of the bill, in June, 1872, reducing the duties on salt, the invoice price, even in July, 1872, under the old duty, being advanced over 1J cents per 100 pounds; in fiscal year 1873, very nearly 6J cents above what it was in fiscal year 1872; in fiscal year 1874, about 10 cents; in fiscal year 1875, over 7 cents ; and in fiscal year 1870, over 4J cents. In 47 months after the reduction of the duty took effect, the average increase in the foreign invoice value amounted to 8.343 cents per 100 pounds, or to more than two-thirds of the duty taken off. Practically considered, therefore, the reduction of duty deprived the government during that period of $1,611,336.09 of revenue, and legis- lated $1,120,281.69 of that sum into the pockets of the foreign manu- facturers of salt, to whom the legislation by Congress was an enabling act to that extent by the enlargement of competitive powers which it conferred upon our alien rivals. Comparing the whole period ending in 1881 with the one ending with July, 1872, it appears that the foreign- ers increased their invoice prices an average of 3.895 cents per 100 pounds, or by nearly one fourth of the duty taken off, so that, in the aggregate, the government lost $3,891,113.88 of revenue from salt in packages alone, and the salt makers pocketed the sum of $1,262,990.91; consequently, the legislation in 1872, advocated and framed in the in- terests of cheap salt, was virtually a movement to enable the foreign manufacturers to charge more for their salt, at the expense of the na- tional revenue, of the American consumer, and of our domestic pro- ducers. Thus was the object of reducing the duties completely frus- trated by the, practical result, and would be again, should the duties be further reduced, or should they be repealed. The rise in the prices attracted attention and was felt everywhere in this country. On (his subject the report of the Hew York Chamber of Commerce for the commercial year ending April 30, 1873, said : The reduction of duty on foreign salt has not had that effect upon the price of salt which was anticipated by those who advocated the passage of the act. The cost of both fine and ground salt is higher than it was before the duty was reduced, and the importation of fine salt has fallen off slightly from that of 1871. EXPERIENCE OF THIS COUNTRY WITH FREE TRADE IN SALT. By the act of March 3, 1807, the duty of 20 cents per bushel was repealed, to take effect January 1, 1808, from which date, until the act of July 29, 1813, reimposing the duty of 20 cents per bushel went into operation, salt was admitted free through our custom-houses. Contrary to general expectation, the prices of salt advanced, instead of receding, during this experiment with unrestricted commerce in the article. Its manufacture in this country was so injuriously affected by the aggressive foreign competition that many works either abandoned or greatly re- duced their production. Development of the industry was not only crippled, it actually retrograded, as may be fully learned by consulting the annals of those times. Bishop’s History of American Manufactures, speaking of the year 1809, says: The domestic manufacture of salt in the United States had not for several years kept pace with the increase of population. At the Indiana or Wabash saline, where rlie cost of manufacture did not exceed seventy-five cents per bushel, the market price of salt had not been less than two dollars a bushel, the quantity being short of the ^demand. 1206 TARIFF COMMISSION. [DAVID II. MASON. And, again : The quantity in the country was considered very inadequate to the supply of the year. When the war of 1812 arrived, the foreign supply was cut off — the main sources from which we had derived salt having been England, our enemy, and her colonies — and we were left almost wholly dependent upon the scanty quantities made by the few establishments not driven out of business by foreign rivalry. Here is what “The Committee on Salt” had to say on the subject, in their report to “ The National Con- vention for the Protection of American Interests,” convened in New York April 5, 1841 : During the last war with Great Britain, this article was sold in quantity in more than one of our States at four dollars per bushel, when, had there then existed in those States proper establishments for making it from sea-water, it might have been supplied as low as thirty-five cents per bushel ; thus, under the then state of things, one year’s supply was equal to eleven years under the other; or, during three years of such a war, the cost of supply might equal that of thirty-three years. That is the way we secured cheap salt by absolute free trade in the article. The cost of the tax at four dollars per bushel must have greatly exceeded what would have been the cost to consumers proceeding from a strictly protective duty, continued long enough to build up a salt industry at home always adequate to the home supply, even admitting as true the false and vicious notion that a duty on any import is a tax upon the home-made no less than upon the foreign commodity. . The true tests of the excellence or the folly of any system are its results, when carried fully into operation. These confirm sound theories, however fallacious they may appear on a superficial view, and set the seal of condemnation upon bad ones, no matter how plausible an aspect they wear on paper. Free trade in salt having utterly failed in practice to give cheaper salt to American consumers after a fair trial of its effi- cacy, extending over about six consecutive years, it would be flying in the face of adverse experience to try the ruinous experiment over again, with any expectation of thereby reducing prices in the Ameri- can market. THE DAIRY INTEREST’S DEMAND FOR FREE SALT. For a number of years the Butter, Cheese, and Egg Association has been accustomed, at its annual meeting, to pass resolutions demanding that the kind of salt used by its members be placed on the free list. It is urged, in justification of this demand, that — The dairy interest of this country requires large importations of foreign dairy salt for the successful manufacture of products, large quantities of which are taken by the country this salt is imported from, and which country charges no tariff on their im- ports of American butter and cheese, but admits the same duty free. This plea, however, is without any real fo: ce when it is considered that, as experience shows, neither reduction nor repeal of duty leads to cheaper prices, but to greater dearness; that the home-made dairy salt, as proved many times by chemical analysis and by practical trials, is fully equal in quality to the imported article, as well as lower in price; that the exports of American butter have vastly increased under the duty which is the subject of complaint; and that the salt used in preparing butter for market, whether at home or abroad, is bought at the price of salt and sold at the price of butter, so that the butter-maker nets an enormous profit upon the salt. Thus is the proposed abolition of the DAVID II. MASON.] SALT. 1207 salt duty indefensible, even from the dairymen’s point of view. About 0 pounds ot salt, costing not to exceed 9 cents, are required to season and pack 100 pounds of butter, according to many authorities. Now, this salt is sold as if so much butter, at prices ranging from 18 to 45 cents per pound, according to quality of product. In this way from $1.08 to $2.70 is netted for the G pounds of salt used. Should not the dairymen be content with several thousand per cent, profit on the salt they sell with their butter ? Moreover, the duty on the imported salt has not interfered with our exports of butter, as will be seen by the fol- lowing statement compiled from the official records : Domestic exports of butter. 1857 1858 1859 1860 1861 1862 1863 1864 1865 1866 1867 1868 1869 1870 1871 1872 1873 1874 1875 1876 1877 1878 1879 1880 1881 1882 Totals. Years ending June 30 — Pounds. Invoice Average values. per pound. 3, 141, 592 3, 082, 117 4, 572, 065 7. 640, 914 15, 531, 381 26, 691,257 35, 172, 415 20, 895, 435 21, 559, 892 3, 806, 835 4, 912, 355 2, 071, 873 1, 324, 332 2, 019, 288 3, 965, 043 7, 746, 261 4, 518, 844 4, 367, 983 6, 360, 827 4,644,894 21, 527, 242 21, 837, 117 38,248, 016 39, 236, 658 31, 560, 500 14, 794, 305 351, 229, 431 $593, 084 541, 863 750, 911 1, 144, 321 2, 355, 985 4, 164, 344 6, 733, 743 6, 140, 031 7, 292, 715 1, 267, 851 1, 184, 367 582, 745 484, 094 592, 229 853, 096 1, 498, 812 952, 919 1, 092, 381 1, 506, 996 1, 109, 496 4, 424, 616 3, 931, 822 5, 421,205 6, 690, 687 6, 256, 024 2, 864, 570 70, 430, 907 $0 18. 875 17. 581 16. 424 14. 976 15. 169 15. 602 19. 145 29. 385 33. 825 33. 305 24. 119 28. 126 36. 554 29. 329 21. 515 19. 359 21. 088 25. 009 23. 692 23. 886 20. 559 18. 005 14. 174 17. 052 19. 822 19. 363 20. 053 To one who carefully and understanding^ studies these statistics, it must be apparent that the general rule which has governed the expor- tations of butter is that they were largest when the prices were lowest to the foreign purchaser. It is true that both quantities and prices rapidly advanced after June 30, 1862; but these exceptionally high prices were greenback, not gold, values, and they do not represent the actual cost to the buyers abroad. Foreign exchange was sold in the American market at the price of gold, and this premium sometimes re- duced the value of the exported butter, measured in metallic money, to half of the greenback figures, so that, while the apparent price was very high, it really was very low to the foreign purchaser. So long as the gold premium continued, this cheapening effect was realized by the English, who were then and are now the chief European consumers of American butter, they taking annually the great bulk of our exports of that article. It should be noticed in this connection that in fiscal year I860, when the average export price suddenly rose to more than 3GJ cents per pound, the quantity exported fell to the lowest figures in all the twenty-six years given iu the table, although, the premium on gold in that fiscal year never rose above 50 per cent., and most of the time fluctuated between 34 and 45, thus significantly confirming the 1208 TARIFF COMMISSION. [DAVID H. MASON. general rule that exportations have been largest when prices have been lowest to the foreigner, no matter what the tariff on salt. The instantaneous decline in the exports, after fiscal year 1865, was due to the close of the civil war, by which hundreds of thousands of sol- diers were returned permanently to their homes, where they immensely increased, through their suddenly added consumption, the domestic demand for butter, thereby vastly diminishing the surplus which had been accustomed to seek a foreign market. It was only after the dairy interest had been widely developed by the multiplication of creameries, a new excess created, and prices considerably reduced, that exports were resumed on an extensive scale. It will be impossible for the most ingenious scrutiny to discover any adverse influence exerted upon the butter industry by the duties on salt. Under the tariff of 1857, when the average duty on every kind of salt was equivalent to only 1.58383 cents per bushel, the total quantity of butter exported in the five years of that period did not equal the quan- tity exported in the single fiscal year 1863, when the duty on salt used for dairy purposes was dutied 24 cents per 100 pounds, except in the month of July, 1862 — the first of that fiscal year — when the duty was 18 cents per 100 pounds. In the fifteen years under the tariffs of 1846 and 1847, when the custom-house charges on imported salt were the lowest in our entire history, 66,118,096 pounds of domestic butter were exported from the United States; in the 10 years and 1 month, when the duty on dairy salt was 18 cents per 100 pounds for 1 month, and 24 cents per 100 pounds for the rest of the time, 104,031,946 pounds of butter were exported; and in 9 years and 11 months, clown to the close of June 30, 1882, under the present duty of 12 cents per 100 pounds of salt, 186,538,169 pounds of butter were exported. It is plain, therefore, that the dairy interest has no just ground of complaint against the salt duty. Consider- ing that such rapidily augmenting quantities of butter can be sent abroad to be sold away from the shelter of our tariff, successfully compet- ing with all foreign rivals, and that the domestic production of butter is protected by an import duty of 4 cents per pound, the clamor of the dairymen against the salt duty as injurious to their industry is seen to be without an atom of substantial foundation. THE SALT DUTIES NO BURDEN TO THE FARMER. A false cry raised some years ago, and constantly reiterated ever smee, is that, before our civil war, the Western farmer could buy with one bushel of wheat in the Chicago market one barrel of salt, but that, under the present duties, lie must pay out two bushels of wheat to get the barrel of salt, being taxed one bushel of wheat on account of the tariff, to be paid to the salt manufacturers as a bounty to support their business. This' unfounded, yet mischievous, allegation is easily dis- proved by a reference to the prices current. Below are the highest monthly prices of spring wheat and of American tine salt in two of the years when the tariff on salt was the lowest ever imposed by Congress. These prices are copied from the annual reviews of the tiade and com- merce of Chicago, as published in pamphlet form at the time by the Chicago Daily Press and Tribune, the quantity of wheat required to pay for a barrel of salt being calculated from these data. DAVID H. MASON.] SALT. 1209 Purchasing power of wheat for salt, when the salt duty was 1.58383 cents per husliel. 1857. .January . . February . March April May June July August . . . September October... November December Spring wheat, highest per bushel. Fine salt, highest per barrel. Bushels of wheat for barrel of salt. 1858. Spring wheat, highest per bushel. Fine salt, highest per barrel. Bushels of wheat for barrel of salt. $0 87 $1 95 2. 2414 January $0 57 $1 90 3. 3333 90 2 00 2. 2222 February 57 1 90 1 3.3333 91 2 06 2. 2637 March 61 l 90 3. 1148 88 2 06 2. 3409 April 62 1 90 3.0645 1 10 1 90 1. 7273 May 65 1 70 2.6154 1 25 2 00 1. 6000 June 65 1 60 1 2.4614 1 27 (*) July 68 1 55 2. 2794 1 14 1 75 1. 5351 August 72 1 47 2. 0417 96 1 85 1. 9271 September 88 1 48 1. 6818 77 1 85 2. 4026 October 88 1 55 1.7614 69 1 90 2. 7536 November 75 1 50 2.0000 54 2 00 3. 7037 December 70 1 60 2.2857 * No quotation given for salt in July 1857. In most significant and convincing contrast is the following statement, compiled and calculated from prices published in the last two annual re- ports of the Chicago Board of Trade — a body which had not been organ- - ized at the time of the above figures. The prices given are, in every case, the highest for cash. Purchasing power of wheat for salt, when the salt duty was 12 cents per 100 pounds.* January . . February . March April May J line July August . . . September October . . . November December. o © 11 SI c£ . a t A bC ft to - 5 to Bushels of wheat for barrel of salt. 1881. %% fcJD'f .9 ® ®> to