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PARAGRAPH 488COPAL GUM.

Mr. RAINEY. And unless we change that law in some way you are going to continue to do that?

Mr. DORIAN. Oh, yes.

Mr. Rainey. And in addition to that you are going to fix a price that will suit you, to the ultimate consumer?

Mr. DORIAN. I do not think I heard that.

Mr. RAINEY. I say, in addition, according to the law you admit that you exercise the right to charge the ultimate consumer so much for the record you make, compel him to pay that, in addition, you do not insist on getting the raw material free?

Mr. DORIAN. We have always gotten the raw materials free. It. is well established that raw material that is used which is not produced in this country, could not be developed in this country, should come in free. That has been so for many years.

Mr. RAINEY. How much do you pay your employees in your establishment ?

Mr. DORIAN. We pay from $1.50 a day to $10 or $20 a day.
Mr. RAINEY. How many children do you employ?
Mr. DORIAN. None.
Mr RAINEY. How many women ?

Mr. DORIAN. We have, in the clerical department, quite a number of them; but in the factory proper we have no women working on machines.

Mr. Rainey. How many men do you pay $20 a day?
Mr. DORIAN. I did not

say

laborers.
Mr. RAINEY. Those are salaries?
Mr. DORIAN. I said we paid from $1.50 a day to $20 a day.
Mr. RainEY. Well, $20 a day?

Mr. DORIAN. Our laborers we pay the same that other factories located in Bridgeport pay.

Mr. RAINEY. Who gets $20 a day?
Mr. DORIAN. The foremen and factory superintendents.
Mr. RAINEY. Those are salaried men ?
Mr. DORIAN. Yes.
Mr. RAINEY. You call those the salaries?

Mr. PAYNE. If you have to pay a duty on these materials imported bere do you see any way of making up for that duty and getting it out of the business unless it comes out of the profit, and if they call for it, it comes out of the

wages s? Mr. DORIAN. It will not come out of the wages; no. deprive a certain per cent of our various laborers of the opportunity to earn any wages.

Mr. PAYNE. Do you think it would hurt your business any by cutting down the duty and putting on this tax on your material, so as to open up the market for foreign competition, taking away part of your market?

Mr. DORIAN. It is certain that it will take away our export market.
Mr. PAYNE. How about your interior market?
Mr. DORIAN. It won't affect that at all.
Mr. PAYNE. Why not?

Mr. DORIAN. Because there is already a tax on imported talking machines.

Mr. PAYNE. I understand that that is to be reduced.

But it may

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PARAGRAPH 488_COPAL GUM. Mr. DORIAN. Well, they might reduce that. I do not know what the purpose of the reduction is.

Mr. PAYNE. Also put a tariff on the material that you put into it.

Mr. DORIAN. We would still be protected by the patent situation, which the Oldfield bill, if it becomes a law, we hope will not affect at all.

Mr. PAYNE. Now, instead of putting that duty on the gum that comes in here that does not seem to do anybody any particular good, they leave that there and cut down the duty on your product, would not that, or would it, give the consumers of the country a chance to get the product cheaper ?

Mr. Dorian. I do not believe it would change the price of the product if they cut the duty down.

Mr. PAYNE. You do not think the ultimate consumer would get it any cheaper ?

Mr. Dorian. I do not, sir; because the price is already established on a very reasonable basis.

Mr. PAYNE. Who would absorb that, you or the middlemen? There would be a difference there. Who would absorb it, you or the middlemen ?

Mr. DORIAN. I do not believe that the Government would get anything

Mr. PAYNE (interposing). Would it get down to the point where
Mr. James (interposing). Let him answer one question at a time.
Mr. PAYNE. Somebody would have to absorb the difference.

Mr. DORIAN. I do not believe there would be any revenue from the talking machines.

Mr. PAYNE. Who would absorb that difference?
Mr. DORIAN. Do what, sir?

Mr. Payne. The difference in the tariff. Suppose the tariff is reduced and they import these goods.

Mr. Dorian. They can not import them.
Mr. PAYNE. They can not import them anyway?
Mr. DORIAN. No.
Mr. PAYNE. Why not?
Mr. DORIAN. Because of the patent situation.
Mr. PAYNE. The patent?
Mr. Dorian. The patent.
Mr. PAYNE. Oh, you don't need any duty, anyway?

Mr. DORIAN. We don't need any help at all as to the American market. I am here trying to help the committee to avoid spoiling our export trade.

Mr. PAYNE. Then I am in favor of putting it on the free list.
Mr. Hill. Do you use shellac and varnish for making films?

Mr. Dorian. We do not make films; we make nothing but talking machines.

Mr. HILL. What do you call them?
Mr. DORIAN. We call them records; disks.
Mr. HILL. You use it in making your machines
Mr. DORIAN. We do not use varnish.

Mr. Hill. You do not use it in making disks, but it is used in the sewing-machine industry, and by you in making your tables and stands and things of that kind?

PARAGRAPH 488_COPAL GUM.

Mr. DORIAN. Yes. Mr. Hill. I will consider this proposition, a typewriter put on the free list and a cent a pound put on gum shellac or gum copal which is used, and duties added to their raw material, would it not compel something of a scaling of wages in those establishments ?

Mr. DORIAN. Either that, or if it was an article which would permit of augmentation of the price it would be in the augmentation of the price, but if that were not possible there must then be either a reduction in the quality or a reduction in the price of labor.

Mr. Hill. The adoption of this system of putting duties on noncompetitive raw material at the same time that heavy reductions are made on the finished product must necessitate a reorganization of all those industries where these raw materials are used.

Mr. DORIAN. I think so, sir. Mr. Hill. And where can that come in except in the reduction of labor ?

Mr. DORIAN. That is where it would be found first. It means that if this same policy were carried out with respect to all of the different items entering into the tariff schedule that we would be legislating in favor of our competitors, and discriminating against our own citizens. That is the way this proposition appeals to me.

Mr. HARRISON. Mr. Dorian, do you believe that it would be possible for the manufacturers to pay this tax out of their profits, out of their present profits? Mr. DORIAN. Do you mean out of their profits? Mr. HARRISON. Yes; that you could out of your profits. Mr. Dorian. Yes; if the cost of production is not increased thereby:

Mr. HARRISON. Do you believe in the manufacturers of the United States paying their share of the tariff taxes ?

Mr. DORIAN. I believe most of them do. I know we do.
The CHAIRMAN. How much are your profits?
Mr. DORIAN. We pay 7 per cent dividends.
The CHAIRMAN. How much is that on your stock annually?

Mr. DORIAN. I would rather not state that in a public meeting of this kind.

The CHAIRMAN. On how much do you pay 7 per cent? How much stock have you got?

Mr. KITCHIN. How much is the capital stock of your company-this corporation ?

Mr. DORIAN. Its authorized capital is $10,000,000.

The CHAIRMAN. Capitalized at $10,000,000 and pays 7 per cent dividends?

Mr. Dorian. The authorized capital stock of the company is $10,000,000. Of this authorized capital stock, however, but $4,723,180 has been issued, viz: Common, $2,627,550; preferred, $2,095,630; total, $4,723,180. The company has paid dividends of 7 per cent, but on its preferred stock only. The bonded indebtedness of the company is about $1,350,000.

The CHAIRMAN. If we leave this tax on, how much of this raw material are you going to buy, or do you buy now?

Mr. DORIAN. I would figure that this would make a difference to us of $15,000 to $25,000 a year.

PARAGRAPH 488—COPAL GUM. The CHAIRMAN. In other words, we are about to tax you, if we put this into effect, about $25,000 a year for your industry and you pay $700,000 in dividends. You can easily pay that $25,000 tax without any

Mr. DORIAN (interposing). You mean can we, Mr. Underwood, if the tax is imposed? We can pay it.

Mr. Rainey. How much money have you got invested in your land and buildings ?

Mr. Dorian. In the land and buildings ?
Mr. RAINEY. Yes, sir.
Mr. DORIAN. We have got a factory there that covers an entire
block of ground.

Mr. RAINEY. How much did it cost you?
Mr. DORIAN. I could not tell you that.
Mr. RAINEY. Have you no idea what it cost to build that building ?
Mr. Dorian. I could not give you that information.

Mr. KITCHIN. Maybe you can give this information: You have got $10,000,000 capital stock. How much money was actually paid in for that $10,000,000? If you do not want to tell, that is all right.

Mr. Dorian. I do not think the committee is entitled to any such information as that.

Mr. KITCHIN. What?

Mr. DORIAN. I do not think the committee is entitled to that information.

Mr. KITCHIN. I just wanted to know.

Mr. Dorian. I do not care to make a statement of that kind. I do not think the gentlemen of the committee have a right to ask questions of that kind.

Mr. JAMES. You stated to Mr. Payne that you did not think the tariff rates fixed in this bill passed by the House would cause any reduction of wages. Is that right?

Mr. DORIAN. I do not think I said so, sir. You must have misunderstood me. Perhaps I misunderstood Mr. Payne.

Mr. James. That is my understanding, that you stated it would not cause any reduction in wages at all.

Mr. DORIAN. I did not understand the question.

Mr. James. Because you are already protected in this case by patents.

Mr. DORIAN. I remember saying to Mr. Payne that labor would be the first to feel any reduction that would take place.

Mr. JAMES. You said that to Mr. Hill.
Mr. DORIAN. To one of these gentlemen.

Mr. James. That is the gentleman over there [indicating Mr. Hill), the end man.

Mr. RAINEY. How much money have you got invested in machinery

Mr. DORIAN. If these are material questions I could get that information and give it to you personally.

Mr. Rainey. I want to know. Have you any objection to answering?

Mr. Dorian. We have a big factory there, employing 1,500 workmen, and it is full of machinery.

Mr. RAINEY. Is it not true you have not got as much as $300,000 invested in your manufacturing plant?

PARAGRAPH 488—COPAL GUM.

Mr. DORIAN. All of that.
Mr. RAINEY. Any more than that?
Mr. DORIAN. I would not undertake to tell you off-hand.

Mr. RAINEY. Is it not true that you have not got as much as $500,000? Mr. DORIAN. It is a big concern.

Mr. RAINEY. Outside of your patents which you hold at a certain value, are you sure you have got as much as $500,000 ?

Mr. DORIAN. I will tell you what I will do, sir. I will take pleasure in sending you our last and our next annual statement.

Mr. RAINEY. I do not care for that. This is a public hearing, and we are trying to get at the facts, and what the Government thinks you are entitled to.

Mr. SHACKLEFORD. Have you a bonded indebtedness ?
Mr. DORIAN. Yes, sir.
Mr. SHACKLEFORD. Will you state how much?
Mr. DORIAN. A bonded indebtedness of over a million dollars.
Mr. SHACKLEFORD. Over a million ?

Mr. DORIAN. Yes, sir. The company was authorized to issue bonds at $2,000,000. They have not issued the full amount. This company is 25 years old, sir, organized in the city of Washington.

Mr. KITCHIN. The original issue of stock was $10,000,000 ?
Mr. DORIAN. No, sir.

Mr. KITCHiN. Of course you understand when you gentlemen come here and ask us for a tariff so that you can pay a reasonable dividend on your capital stock, we have a right to know how much of it is represented by money and how much is mere paper.

Mr. DORIAN. With all due respect to the committee, I do not think you have a right to ask a question of that kind.

Mr. KITCHIN. If you ask us to give you a tariff which will pay a dividend on your capital stock, then we have a right to ask how much is the real capital stock with the water out.

Mr. DORIAN. I think I have made it very clear to the committee that if this duty were imposed it would not put my company out of business. It might induce the company to switch a portion of its manufacturing from one factory to another.

Mr. JAMES. Whether this tariff rate that is now under discussion is paid by taking $25,000 out of your $700,000 dividends, or whether it is paid by increasing the price of the article you sell, these articles are not necessities; they are luxuries, are they not?

Mr. Dorian. Well, they might be so considered, but most people look upon them as necessities, the same as they do on any other musical instrument.

Mr. James. Any other amusement?

Mr. Dorian. They are considered more as music. They are now looked upon as musical instruments--instruction. People buy them to instruct their children in music and a musical education.

Mr. Hill. Mr. Dorian, this whole series of questions seems to be based on the theory that you are a very large consumer of these two articles.

Mr. DORIAN. Yes.

Mr. Hill. As a matter of fact, compared to the total consumption of the United States, you are a very small consumer?

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