Foreign selling prices of hammered chain, compared with American common coil chain

Comparative wage schedule paid foreign and American union chain makers for

The foregoing arguments and exhibits being actual facts, all of which can be verified, are, we believe, the strongest arguments that can be made for an entirely new schedule on chain to be included in the new tariff schedule which is being prepared, being based on actual costs of manufacture abroad as against the costs of the American manufacturer.

Exhibit A is figured out, as shown thereen, based on foreign selling prices plus the proposed duty to be levied under the new revision. We appeal to your honorable committee that in view of the foregoing you will insert in your proposed revision of tariff to be submitted to the new Congress and urge the passage of the proposed chain schedule as annexed, which schedule is submitted in accordance with the request of your honorable chairman, Mr. S. E. Payne, to the undersigned when appearing before your committee on November 27, 1908.

Signed in behalf of the chain manufacturers of the United States: LEBANON CHAIN WORKS,

H. F. MATTERN, Vice-President.
WOODHOUSE CHAIN WORKS,
Trenton, N. J.,

THOS. T. WOODHOUSE.

PROPOSED SCHEDULE.

Chain or chains, of all kinds, made of iron or steel not less than 2 inches in diameter, seven-eighths cent per pound, but no chain of any description of these sizes shall pay a lower rate of duty than 30 per cent ad valorem.

Chain or chains, of all kinds, made of iron or steel less than 2 inches, but not less than thirteen-sixteenths of an inch diameter, 1 cent per pound, but no chain or chains of any description of these diameters shall pay a lower rate of duty than 40 per cent.

Chain or chains, of all kinds, made of iron or steel less than thirteen-sixteenths of an inch, but not less than thirteen thirty-seconds of an inch in diameter, 14 cents per pound, but no chain or chains of any description of these diameters shall pay a lower rate of duty than 60 per cent ad valorem.

Chain or chains, of all kinds, made of iron or steel less than thirteen thirty-seconds of an inch, but not less than one-fourth inch in diameter, 2 cents per pound, but no chain or chains of any description of these diameters shall pay a lower rate of duty than 60 per cent ad valorem.

Chain or chains, of all kinds, made of iron or steel less than onefourth inch in diameter, containing not more than 12 links per foot, 3 cents per pound, but no chain or chains of any description of these diameters and length of link shall pay a lower rate of duty than 60 per cent ad valorem.

Chain or chains, of all kinds, made of iron or steel less than onefourth inch in diameter, containing more than 12 links per foot, 5 cents per pound, but no chain or chains of any description of these sizes and length of link shall pay a lower rate of duty than 90 per cent ad valorem.

LEBANON CHAIN WORKS,
H. F. MATTERN,

Secretary and Treasurer.

STATEMENT OF THOS. T. WOODHOUSE, TRENTON, N. J., RELATIVE TO GERMAN PATTERN COIL AND HALTER CHAINS.

FRIDAY, November 27, 1908.

The CHAIRMAN. Whom do you represent, Mr. Woodhouse? Mr. WOODHOUSE. I represent the Woodhouse Chain Works, of Trenton, N. J.

The CHAIRMAN. Very well; you may proceed with your statement. Mr. WOODHOUSE. Mr. Chairman and gentlemen of the committee, what Mr. Mattern has been talking about principally has been handmade chain, which is a high-grade chain, and in which we are vitally interested as well, but principally I am here to represent what are called German pattern coil and halter chains, of which we make a considerable quantity, or have in the past. Last year we made very little, and I notice by the reports of the Treasury that the importations have increased considerably over 1907-yes, considerably; almost 60 per cent. The chain business is a peculiar one, and you can not consider it as a whole. The total valuation of all the manufacturers of this country is not a fair guide to consult on tariff matters. For instance, our factory is considered almost technically a specialty factory-that is, they make small special chains for all kinds of purposes. We have made in the past, and have educated our workmen up to the making of these small-sized chains, and they can not reverse themselves and go back to the making of heavy chains with profit either to themselves or the factory for which they work. For instance, on less than five-sixteenths-inch chain there was imported during the year 1907-8, on which there was a specific duty levied, a quantity amounting to 186,806 pounds, making a valuation of about $10,000, on which the duties levied were about $5,604. On chain of those sizes, on which there is 45 per cent levied, there was a total of 579,000 pounds imported, of a foreign valuation of $45,000, of a total New York valuation of $65,000-sufficient in that one item to keep a factory of our size working steadily.

Mr. GRIGGS. I happened to be out of the room for a moment when you went on the witness stand. I would like to interrupt you at this point long enough to inquire whether your company is making any money?

Mr. WOODHOUSE. Not this year.

Mr. GRIGGS. How about last year?

Mr. WOODHOUSE. We made some money last year and in 1906.
Mr. GRIGGS. All right, sir; go ahead. I am not astonished.
Mr. WOODHOUSE. No; I do not suppose you are, sir.

I have here, Mr. Chairman and gentlemen, a copy of the English prices, where the f. o. b. Liverpool price is compared with our market prices, which I will submit later in a brief, if the committee so desire. I not only have the copy, but I have the original quotations, some of which I bought a year and a half ago. For instance, on hand-made chain, to which our previous witness referred, on half-inch chain, the American wages are $3.12 a hundred pounds, while the English wages, a copy of which I have, are $1.36 per 100 pounds. But in that cost of wages the English chain maker must include his cost of fuel and factory expense, while the wages we pay are net to the workman. There are no expenses whatever that our workman has to pay out of the $3.12. Now, as a comparison on this same half-inch chain, our

prices delivered in New York City to-day are $8.70 per hundred pounds, while I can import it from England and pay the duty and all expenses for $6.18 per hundred pounds, a difference against the American manufacturer of $2.52 per hundred pounds.

Mr. UNDERWOOD. With reference to that imported article, let me ask you where you buy it?

Mr. WOODHOUSE. Where in England?

Mr. UNDERWOOD. Yes.

Mr. WOODHOUSE. I can give a dozen houses, but I will give the two where I made purchases personally. I have quotations from Fellows Brothers, Cradley Heath, England, under date of October 11, 1907Mr. UNDERWOOD. That is per hundred pounds?

Mr. WOODHOUSE. I have figured it out on the basis of a hundred pounds.

Mr. UNDERWOOD. What did you pay per hundred pounds at the foreign purchasers in England?

Mr. WOODHOUSE. On half inch?

Mr. UNDERWOOD. Yes; the quotation you have given of $6.18 there?

Mr. WOODHOUSE. The English price f. o. b. Liverpool is $4.12 for 100 pounds, or 19 shillings and 3 pence for 112 pounds, or $4.12 for 100 pounds.

Mr. UNDERWOOD. What is the freight rate to New York?

Mr. WOODHOUSE. The freight rate I could not give as to the specific amount, but it is very small, I presume not over 25 cents a hundred pounds.

Mr. UNDERWOOD. That would make $4.37?

Mr. WOODHOUSE. Yes, sir.

Mr. UNDERWOOD. The difference is the tariff?

Mr. WOODHOUSE. The difference is the tariff. I have found by actual importation that the 45 per cent ad valorem duty, together with the total expenses, is about 50 per cent of the English cost price f. o. b. Liverpool.

Mr. UNDERWOOD. You say the cost price on that same chain in your factory was $8.70?

Mr. WOODHOUSE. No; that is our selling price.

Mr. UNDERWOOD. What is your cost price?

Mr. WOODHOUSE. I do not have that here, but it would not give us over 10 per cent profit.

Mr. UNDERWOOD. We are going to try to ascertain these facts from other sources if you do not have them. We may make mistakes unless you can give them to us accurately.

Mr. WOODHOUSE. If I assert to you we make 10 per cent profit, you can easily get the cost price.

Mr. UNDERWOOD. You make the calculation then and state the cost price.

Mr. WOODHOUSE. The cost price on that class would be $7.83. Mr. BONYNGE. Is it fair to put their selling price against your cost price?

Mr. WOODHOUSE. You have the selling price in both cases and not the cost price.

Mr. BONYNGE. But in the questions which are being argued, they are putting the selling price with a profit to the foreign manufac turers against the cost price of the American manufacturers, where

it should be cost price against cost price, or selling price against selling price, in order to make a fair distinction.

Mr. WOODHOUSE. The result would not be any different. The result would show exactly the same figures whether you took the cost price in each case or the selling price.

Mr. BONYNGE. But not the same if you took the cost price in one case and the selling price in another case.

Mr. WOODHOUSE. I am taking the selling price in both cases. Mr. UNDERWOOD. I do not agree with you about that, because I think your cost price is going to compete with their selling price in New York, with freight added, and that is where the competition comes in. Above that you get a profit. That is what we are going to try to ascertain how much profit you ought to get. If we give you a tariff equal to expenses, etc., above the foreign selling price f. o. b. Liverpool and your selling price, will that meet your needs? Mr. WOODHOUSE. If the committee do just exactly what you intimate, I have no fear about where the tariff will be put.

Mr. UNDERWOOD. You think that will be a satisfactory basis?
Mr. WOODHOUSE. Absolutely so.

Mr. UNDERWOOD. You do not ask a prohibitive tariff?

Mr. WOODHOUSE. No, sir; I do not. I would like to have a protective tariff where we can compete on even terms at least.

Mr. UNDERWOOD. Have you filed any figures showing the selling price abroad, with freight added, and your cost price here?

Mr. WOODHOUSE. I have not the cost price. I have the selling price here of the American and the English chains f. o. b. New York.

Mr. UNDERWOOD. You say that the difference between your cost price and your selling price is about 10 per cent?

Mr. WOODHOUSE. Yes, sir; about 10 per cent.

Mr. UNDERWOOD. We can calculate that safely?

Mr. WOODHOUSE. Yes, sir; very safely. That is the price of handmade chains so far as I have gone.

Mr. UNDERWOOD. What is the percentage of labor cost in that?
Mr. WOODHOUSE. In handmade chains?

Mr. UNDERWOOD. Yes.

Mr. WOODHOUSE. It would be at least 70 per cent-70 to 80 per cent additional on small sizes.

Mr. UNDERWOOD. Seventy or 80 per cent?

Mr. WOODHOUSE. Yes, sir; as the chain makers' wages run. There are other labor costs, nonproductive labor, that would enter into it. In German-pattern coil and halter chains we are largely interested, because our men are trained to make the small-sized chains and can not with profit to themselves or to the manufacturer change from the small sizes to the large sizes. On these German-pattern coil and halter chains we are asking for a higher tariff on the 2-0 sizes and smaller. On 18 links per foot, 2-0, which is three-sixteenths size wire and weighs 38 pounds to the hundred feet, the American selling price is $5.80 per hundred feet, while the import price, which gives a profit to the importer, is $5.27 per hundred feet, a difference against the American manufacturer on that one size of 53 cents a hundred feet. On the smaller sizes the differences as you go down are greater. On 1-0 the American selling price is $6.18 against the import price of $5.06, and on No. 2, which is nearly one-eighth inch wire, the Amer

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