PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. last year made a profit sufficient to pay 7 per cent on preferred and 3 per cent on common stock. We are an incorporation. There is an instrument maker in Indianapolis who is a very scientific man, a man of wonderful genius, and he has devised many instruments at the suggestion of the medical profession, and I was talking to him in Chicago not long ago, and I said, "Mr. Schmidt, what do you make out of your business?" "Well," he says, "I have a whole lot of fun, because it is a work that I like, but after I had paid my rent and my men last year my average salary was $18 a week." Now, we could go on indefinitely. Dr. Kelley, of Johns Hopkins, for instance, has invented and designed many instruments that have been made in this country, and after they become enormously popular they have been taken by the German manufacturers and duplicated and sold at a less price than we could afford to make them, and some of these instruments we have had to discontinue making on that account. One other instrument that stands out is a needle holder. There was a needle holder invented in New York that possibly is the best needle holder that was ever made. The needle holder was copied by the German manufacturers, and although it was imported in this country against the duty, it is no longer a profitable article to make, and so we feel in view of these facts that it would work a hardship on us if the hospitals could import, duty free, because, as we heard yesterday, a young doctor serves as an interne in the hospital after he has graduated; the older doctor from whom he takes instructions is on the board of directors and knows about what the hospital pays for things. Now the situation is this: That when one of our representatives goes to that doctor and asks him to pay $1.50 for a speculum that the duty had been paid on, and he knows that the hospital has been buying it for 95 cents, it puts us at a disadvantage. Now, when you say the hospitals do not sell instruments, or when that claim is made, it is an unfair statement; for instance, clinical thermometers are sold to nurses for 35 cents each, and they cost wholesale about 28 cents. Now, after the nurse who has served her time goes out into general practice, she can not understand why she has to pay 75 cents for the thermometer. And I could cite other cases if you cared to take the time. Another case that comes up is in the operating tables. Now, when the statement is made that the foreign countries are far advanced in surgical cases, I think it is distance that lends enchantment. It is a fact that the best operating tables are designed in this country and are copied abroad. For illustration, there is an operation necessary to lift a person up in such a position [illustrating]. Now, the patient is brought in and laid upon the towel, two assistants lift up the towel, and the little bench is slid under him. In America we turn a wheel and raise the patient a fraction of an inch at a time and place him in position. Another point is the X-ray business. Now, the medical profession criticized the X ray very severely when it came out, even after it had received the indorsement of such men as Mr. Edison. I know that the first X-ray outfit put in a hospital was put there on consignment, and it took considerable salesmanship on the part of the surgical-instrument men to induce hospitals to put in the X-ray outfit. They now PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. find they are of great service, and it appears the Germans can manufacture these outfits cheaper than we can in this country, and if the duty was repealed it would hurt the electrical surgical side of our business tremendously. Mr. RAINEY. In connection with the general schedule I would like to print into the volume the statistics as to certain New England mills, issued by Hawes, Tewksbury & Co., members of the Boston Stock Exchange, in a circular of November, 1912, the last circular they have issued in connection with the woolen schedule. I would like to print in the record an analysis of the report on Farr Alpaca, Holyoke, Mass., woolen mills, the first woolen mill report for 1912 to make its appearance, which appeared in the Springfield (Mass.) Daily Republican of Thursday, January 28. And in connnection with the metal schedule, I would like to print in the record a letter addressed to me by Mr. George J. Gruen, a large manufacturer, of Cincinnati, Ohio, asking for a hearing at some time after the 5th of February, which, of course, can not be granted, but inasmuch as his letter contains much valuable information on this subject, I want to ask permission to print it in the record. And also I would like to print in the record the brief on the Parker rates submitted by Mr. Parker in connection with the cotton schedule, which is being prepared by Mr. Edward B. Shipley, of 49 Leonard Street, New York, an importer and commission merchant who appeared before us. The CHAIRMAN. We will be glad to grant this privilege. Hon. OSCAR W. UNDERWOOD, WASHINGTON, D. C., February 1, 1913. Chairman Committee on Ways and Means, Washington, D. C. RESPECTED SIR: We wish to protest against the duty-free entry of surgical instruments, apparatus, etc., by hospitals for the following reasons: First. There are employed in our factory more than 200 American instrument makers, the majority of whom receive from $18 to $28.50 a week. Second. We are one of over 200 surgical instrument makers, these various makers employing at actual manufacturing from 4 men upward. Third. We wish further to protest against the brief of George F. Clover, superintendent of St. Luke's Hospital, New York, because of its unfairness, who claims that high-grade surgical instruments can not be manufactured in this country. This is a misrepresentation of the facts because it is a well-known fact that instruments of the very best quality are made in the United States and used by our most skilled surgeons. Fourth. The Department of Commerce and Labor some months ago refused to issue certificates of accuracy on foreign-manufactured fever thermometers because the variations were too great for actual use. Respectfully submitted. THE RANDALL FAICHNEY Co., TESTIMONY OF CHARLES J. PILLING, REPRESENTING MESSRS. G. P. PILLING & SONS CO., OF PHILADELPHIA, PA. Mr. PILLING. This is paragraph 650. It is incorrectly stated in the calendar. As seen from the standpoint of a manufacturer of surgical instruments, a double blow and a most dangerous one is aimed at the surgical-instrument industry of this country. PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. Not only is it proposed to reduce the tariff on surgical instruments from 45 to 25 per cent, but an attempt, we understand, is also being made to admit surgical instruments to hospitals free of duty. If this double blow is landed, the surgical instrument mechanics and employers of this country will be turned out of business. It is a well-known fact that hospitals use more than one-half (probably two-thirds) of the surgical instruments that are sold, because in these advanced times practically all surgical operations are performed in hospitals. To show how unjust the request for free duty is, the writer has within the last few days communicated with the St. Luke's Hospital of New York, the superintendent of which, I understand, is to appear before you to request free duty on surgical instruments for hospitals. While communicating with the St. Luke's Hospital I found that the patients in the free ward are charged $10.50 per week. On January 16, 1913, every private room (there are 65 private rooms in St. Luke's Hospital) was occupied, and there was a waiting list. A few days ago the only private room in St. Luke's Hospital available was $10 per day or $70 per week. Terms: Payable two weeks in advance; only two rooms on each floor as low as $24.50 per week; others at $35, $49, and $84 per week. In addition to the charge for the private rooms, there are also extra charges, as follows: For private nurse, which means two nurses, one night and one day nurse, $28 each, $56 per week. There is also a charge for each nurse's board. We do not know the exact figures; but in other hospitals it ranges from $7 to $12 per week. Also, the patient is charged for the nurse's laundry. There is an additional charge for use of the operating room of $10 each operation. There is an additional charge for the assistant who gives the ether of $5 to $10 per operation. Charge of ambulance, $5 to $10; also, for open fire, $1 per day; telephone (5-cent calls), 10 cents each. Then there is another charge for each time the resident physician visits the patient of $3 per visit. Please note this charge of $3 paid by the patient for each visit of the resident physician. The resident physician is one just graduated from a medical college, who is very anxious to serve one year in hospitals for the experience. A very few receive $25 to $50 per month. These resident physicians can make many calls in the private rooms in the course of a day. Let us say 10 calls per day, which would mean 300 calls per month, or $900 for this service. Who gets the difference between $40 or $50 salary and the $900 collected? Up to this time we have not spoken about the fee of the surgeon, which we all know is by private arrangement from $50 to $5,000, and in some extreme instances up to $10,000. 78959°-VOL 6—13—13 PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. Let us look around and see if there are other sources of revenue, and in order to do so I will read an extract from a letter received from another hospital on January 24, 1913: NEW YORK ORTHOPEDIC DISPENSARY AND HOSPITAL, Received your last letter, but the catalogue wanted was for brass handles, as we have a machine shop and make our own instruments. Please note that this is from the New York Orthopedic Dispensary and Hospital. This is no exception, because in other cities some hospitals have their workshops for making surgical needs. There is a hospital in a near-by city containing 50 private rooms, ranging from $25 to $110 per week. It is reported that in this hospital one of the many surgeons does enough operating on private patients to keep busy an average of 20 nurses. This hospital also has a shop of its own making surgical appliances. What chance would the American manufacturer have with hospitals making part of their instruments and importing free of duty the balance? Still another, having over 70 private rooms, at from $28 to $150 per week, plus extras. In Philadelphia a certain hospital takes only charity patients, but they have an annex in another part of the city for which they refused $3,000,000 (on which no taxes are paid or never have been paid). This annex has several hundred rooms for private patients only, from whom they receive from $25 to $60 per week. What is a hospital, and how many are there? The census report states that there are nearly 5,000. The late medical directory gives, however, 8,000. The word "hospital" is so indefinite that it is absolutely impossible to draw the line as to where private practice stops and hospital practice begins. It is a well-known fact that private practice in hospitals results in princely incomes to the surgeons and practitioners associated with the different hospitals. While it is true that there are many so-called charity cases treated free, it is also true that the physicians themselves have formed committees in their societies to fight the so-called hospital abuse, because many of these charity patients are able to pay. As late as January 13, 1913, I believe, Mr. Underwood is quoted as saying (Philadelphia North American, Jan. 14, 1913): Where there is a large percentage of imports we do not want to cut the rates. We are desirous, however, of cutting the rates where there is not competition and no revenue. Surely the surgical-instrument business has competition of the keenest kind, when more than one-half of the surgical instruments now used in this country are imported. If you reduce the tariff, your revenue is decreased; and if instruments for hospitals are admitted free of duty, the manufacturer in America can not stay in business. Surely when it reaches the point that hospitals are running their own surgical-instrument shops and PARAGRAPH 650-SURGICAL INSTRUMENTS, ETC. where other hospitals have a waiting list for private rooms that cost $70 a week, not mentioning the other extras, it would be most unfair to place instruments on the free list. I have here a sworn statement from a surgical-instrument maker, who learned his trade in Germany. He received no wages while learning his trade, but, on the contrary, his father paid 100 marks per year so he could learn it. After he learned his trade and became a man, he worked in Germany, Holland, France, and England, earning from $3.12 per week to $10 per week. In this country boys are paid from $4 to $9 per week while learn ing, and when they become journeymen instrument makers they earn more than double the amount of the German mechanics in the same line. The majority of cost of instruments is labor. Why should the tariff on surgical instruments be reduced to 25 per cent; and, furthermore, why should hospitals who are doing a very large and profitable business be entitled to free duty? Probably you will say that surgical instruments are in the omnibus clause and many of the articles in that clause must be reduced in duty. Surgical instruments are now under clause 199, along with silverware, steam rollers, fishhooks with feathers, aeroplanes, brass beds, metal statuary, antique armor, old cannons, etc. How absurd_to classify an instrument for delicate eye operations with a steam roller or an aeroplane. Perhaps aeroplanes and steam rollers should enter at 25 per cent duty, but certainly not surgical instruments, because so easily classified they should be at least at the cutlery standard, for as a matter of fact a large percentage of the imported surgical instruments come right from the cutlery district of Germany. Surgical instruments of special design are continually and quickly needed for operations meaning life or death. If our surgical industries are crippled our factories can not be operated, and if not operated the American surgeon will be dreadfully handicapped. How about our Army and Navy? This is of grave importance. We should consider the relation of surgical instruments to the Army and Navy in time of war. If American makers of surgical instruments are forced out of business and the supply of instruments from abroad is cut off, our Army and Navy would be in a most embarrassing position. Foreign importations would be prevented by the enemy, and at such times surgical instruments are as necessary and important as ammunition. Finally, we ask that you do not reduce the tariff of surgical instruments to conform to steam rollers, old cannons, brass beds, and antique armor. Also, we ask that hospitals be not allowed duty free, or any other unfair class legislation. Gentlemen, I have shown you some prices private patients are paying in these hospitals. St. Luke's, which we have been talking about, a few days ago had a waiting list for patients; another day the cheapest room you could get there was $10 a day. Where does all that money go to? These institutions are conducted for the profit of the surgeon who comes in and operates. We are very much in earnest about this. The hospitals use more than one-half of the instruments that are consumed now, and if they |