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“The exact number of members belonging to the Socialist trades-unions at the end of 1908 was 1,831,731. of whom 138,443 were women. There are two other important federations of trades-unions which are not of a political character, namely, the Hirsh-Duncker Federation numbering 105,558 members, and the Christian trades-unions comprising 264,519 members.

“ In direct opposition to the trades-unions are the associations of employers. There were at the beginning of 1909 no fewer than 127 of these associations with a total membership of 159,304 employers, giving employment to 3,648,679 workers. They are, however, not so well oragnized as the trades-unions and up till the present they have not formed a central federation.


“Work books, once carried by all workers, are now confined to minors and domestics. In them are inscribed the name of the owner, place and date of birth, date of starting and quitting an employ, and nature of the occupation. In the case of minors under 16 the book also contains the name and domicile of the father or guardian. An employer may not write his opinion of the abilities of the worker or the reason for leaving in the book, either favorable or unfavorable.


“The workers' welfare is well watched over in the workshops. Factory inspectors are at all times empowered to visit factories where 10 men and over are employed, and in trades regarded as unhealthy even where a smaller number of persons are engaged. In many factories where the work is of a dirty nature shower baths are provided, together with wardrobes for the men's outdoor clothing, for it is customary in Germany for the workman to change his outer clothing entirely before he starts work. This is one of the reasons why the workingmen, in whatever trade, present such a clean, neat, and well-to-do appearance in the streets.

“ It is a very rare thing for a worker to be accorded a vacation with his wages in a German factory, but of late years some firms have introduced the system and there is some likelihood of its spreading throughout the country, as the grant has tended to create more satisfaction with the conditions of labor where it has been introduced. The German workman has been badly off, indeed, in this respect, for he does not have a Saturday half holiday.


“ The family life of the working people is on the most modest scale. They are usually contended with their lot in life, and do not share in the hunt after excitement and extravagance. Temperate to a remarkable degree, they delight to stay at home and enjoy the company of their wives and children and join with them in simple home amusements.

“ The extraordinary thrift of the working classes-men and women-is shown by the savings banks' returns, which give a total of over 19,000,000 small depositors, who have £642,600,000 to their credit, all of which is guaranteed by the municipalities.


“Although small incomes are the rule everywhere throughout Germany, there is a considerable number of persons who are in receipt of incomes which may be considered as placing them in very comfortable positions. According to the income tax returns for 1908, there were in Prussia alone no fewer than 17,957 persons enjoying an annual income of between £1,500 and £5,000, a body of 3,796 persons who had over £5,000, 190 with from £25,000 to £50,000, and 77 with more than £50,000 a year.


“Among the principal industries are those connected with coal, Iron, and steel.

" Owing to the immense richness in coal of the Ruhr, the Saar, and the Upper Silesian districts, the iron and steel industries of Germany have concentrated

there and have made such enormous progress that they now employ over 2,000,000 hands. Three works alone, the Krupp, the Phoenix, and the Gelsenkirchen companies give employment to over 150,000 people.

"Coal mining is a great industry, employing about 1,000,000 workers. The State takes part in it to a considerable extent. Of the total of 143,168,300 tons of coal mined in 1907 throughout Germany the State took out 10,693,000.


"The Government mines in the Star district employ 51,000 miners and officlals whose families number over 200,000. Forty per cent of the men possess their own cottages ; 31 per cent live with their parents; the remainder live in surrounding villages. The mines are models of organization and are situated in the center of artificially cultivated forests which belong to the State.

" In the Rhenish Westphalian coal district, which 30 years ago was almost undeveloped and only provided work for thousands, towns have sprung up, and hundreds of thousands are now employed. Everywhere can be seen slack heaps resembling miniature mountain ranges and flaming chimneys of iron and steel works.

"The production of pig iron has increased rapidly since 1900, when 8,521,000 tons were produced. In 1907, 13,046,000 were produced, but this total fell off to 11,814,000 in 1908, owing to the trade crisis which affected the whole world.

“Machinery construction forms a very important branch of German industry, employing over 600,000 persons.

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"The electrical industry has spread to immense proportions and the companies connected with it possess vast resources and employ many thousands of men. They are at the present moment formed into three great trusts, which have eliminated the disastrous competition carried on by the host of smaller concerns before the economic crisis that occurred at the beginning of this country.

“The principal object aimed at by the trade, now that the municipalities bave universally adopted the electric-lighting system and the tramways have all been transformed into electric lines, is the electrification of the great main lines of railway, nearly all of which are in the possession of the various States of the Empire.

"On numbers of the shorter and secondary lines electricity has been introduced and has proved very practical and economical in working. Railway engiDeers say that the cost of electrification is soon paid for by the diminution of the working force necessary, as the motors do not require so much cleansing, damage to forests by fire is avoided, whereby thousands of pounds yearly are saved; there is no smoke from locomotives to injure crops, a far smaller quantity of coal is necessary to develop the electricity than to run separate steam locomotives, and thus space and buildings are saved.


“Chemistry, in which over 90,000 persons are employed, has had its home in Germany since the beginning of the Christian era, and the Germans seem to have been among the first to discover the value of the natural treasures in the shape of mineral and vegetable salts, although owing to the diversions of the nation the chemical industry was not properly developed until later than in England. At the present moment Germany possesses practically a monopoly in the production of potash salts, so useful for fertilization purposes. Over £5,000,000 worth of these salts are utilized annually in Germany in the cultivation of the soil and enormous quantities are exported. In the manufacture of pharmaceutical preparations and smelling salts also Germany takes a leading part. In the past quarter of a century more discoveries have been made in chemistry than in any other branch of science, and with her natural resources and highly trained chemical specialists Germany promises to keep her lead in this respect

A NEW TRADE, “One branch of manufacture, which is entirely new to Germany, has made enormous strides since its introduction. In very recent years Saxony has won a place in the manufacture of tulle which is causing considerable uneasiness in

other countries. In the vicinity of Plauen and Chemnitz factories have sprung up like mushrooms. Twenty years ago not a yard of tulle was made in the German Empire. Now 1,100 tulle frames turn out £2,000,000 worth annually, and more are being erected. The machines for the industry are also being constructed in the neighborhood, and it is said that the spools and shuttles, the secret of manufacturing which has hitherto been in English bands, has now beer. discovered, and that in future the whole trade will be entirely independent.

“OTHER BRANCHES. “One of the most important glass works in the world is to be found in Jena, where 55 tons of optical glasses of all kinds alone are made yearly and exported over the entire world, including telescopic lenses up to 4 feet in diameter. Over 1,200 workers are employed.

“Other great branches of industry are quarrying, employing 317,000; the woodworking trades, in which over 200,000 people are engaged; the clothing trade, employing 220,000; and printing, which occupies considerably over 100,000 people, without taking into consideration the bookbinding and other branches connected with it.


“In the eastern provinces of Germany progress has not been so rapid as in other districts, owing to the lack of coal and iron, but in spite of this rather unfavorable position strong efforts are continually being made to establish industries there. The utilization of the water power of rivers, with which the east is well provided, promises to change the aspect of these hitherto purely agricultural provinces, which will then be able to participate more freely in the timber trades, in brickmaking, papermaking, and the textile trades. The Emperor gave an impetus to the industrial movement of the east by his speech at the opening of the Danzig Technical High School, when he said: 'If the eastern provinces, owing to their position and natural conditions, are less adapted to industrial development than other parts of the Empire, yet techni. cal knowledge will be able to replace in many instances what nature has failed to provide.'


“ Germany shares with England and the United States the honor of the lead in inventiveness. It is, however, notable that very few inventions are brought to the front by the working classes. This is, according to people who have studied the subject in various countries, to be traced to the fact that the German artisans work longer hours and so have less time to devote to exercising their inventive genius. In technical inventions Germany is well to the front. To take one branch alone, in one year no fewer than 1,500 patents were applied for in Germany for inventions connected with electricity.

“ It is not only in the systematic organization of their industries that the Germans have made great progress, but also in the way of bringing their wares to market.



“The commercial German is among the leaders of his kind. He is more to be thanked for Germany's prosperity than is the industrial, for he has gone all over the world and sought markets for the goods. He finds no trouble too great when he is seeking openings for trade. He learns the languages, customs, and coinage of the various countries, and by placing his goods before the foreigners in their own language and figures he often secures orders where others fail.

"Two small examples of the German readiness to meet the wishes of customers: The egg cups imported into India at one time all came from Great Britain. The Indian eggs are, however, very small, and the egg cups did not fill. A German traveler noticed this small item and got his firm to make smaller egg cups and export them there. All the trade is now in German hands.

“ In Africa the scissors imported from Sheffield were found to be rather dangerous weapons to place in the hands of the natives owing to their sharp points. The Solingen Steel Works sent a lot of round-pointed scissors out, which found favor, and now Germany has captured the whole market. Respectfully,


WASHINGTON, D. C., January 30, 1913. Hon. OSCAR W. UNDERWOOD,

Ways and Means Committee, Washington, D. C. Sir: Possibly you may have noticed that a large number of men fail to respond when their names are called at the hearings. Several of them have told me that they were influenced in so doing by what they gathered as to the intentions of the committee. Your statements to the effect that the committee must look solely to the revenue needs of the Government, and that you purpose to establish a competitive tariff have been quoted frequently by the men who have withdrawn from the program because as as they said, “What is the use if their mind is already made up?

I regret that the men seemed to feel that the presentation of the facts and arguments as they understand them is of no avail. Personally, I can not see how the statements made by so many manufacturers in regard to the danger of foreign competition should fail to impress any body of earnest men. The testimony in relation to your hat, given last evening, illuminates the whole situation. Here was an article landed in this country duty paid for $1.10. You paid $5 for it. No reduction in the duty will affect that retail price. Should the bat be landed here for $0.90 or $1 the smiling clerk in the retail store would ask you $5 for it. The clamor against the manufacturers is wholly unfounded, and the claims of bringing about a reduction in the cost of living by reducing the tariff are equally wide of the mark. A reduction of the tariff will bring more foreign competition, and the impossibility of restricting that competition within what the chairman calls “reasonable" limits is more apparent to the manufacturers than it seems to be to the committee. A duty low enough to let in 10 per cent of the foreign-made goods pressing for sale in the export market will let in all that is available for our market. It is as impossible to stop the importation at a reasonable amount as it would be to stop the inflow of the ocean if the dikes of Holland, which hold the sea in reasonable control, were removed. We have prospered under a tariff policy which restricts importations. That prosperity will be seriously affected by a tariff policy which encourages importations.

The leading wool manufacturing countries of Europe had, in 1907, a surplus for export amounting in value to $309,000,000. Our total production of the manufactures of wool, for the corresponding period, would be less than $400,000,000. With a "competitive tarifi” which is low enough to allow the importation of foreign-made woolen goods, how it is possible to prevent the importation of the entire European surplus suitable for our market? A duty low enough to allow part of the European exports to enter our market will let in all that is available for export. The American manufacturer does not need to lose 100 per cent of his business to close his mill. If he loses 25 per cent or 50 per cent he can not run his mill at a profit, and is as inevitably forced to close as though he lost all his business.

The exigencies of the Government never have required and never should require the destruction of Amercan industries in order that revenue may be raised on goods, wares, and merchandise imported from foreign countries.

Permit me to assure the chairman that only the kindest comments have been made on his conduct of the hearings. By his fairness, courtesy, and patience he has added to his large circle of admirers. Respectfully,

Tuomas 0. MARVIN, Secretary Home Market Club, Boston.

The Chairman and Members of the Ways and Means Committee:

A special commissioner of the United States who spent a year in Europe reports as a result of his investigations that the sale abroad of American products at a lower price than at home is very rarely the case. After repeated inquiries among foreign jobbers and retailers, he learned that the American wholesale price plus the freight, duty, if any, other expenses, and a small profit established the selling price to the consumer. The American manufacturer does not obtain, as a rule, large profits on his export business. Foreign trade extension is a tedious and expensive undertaking and a foreign market for our goods is obtained, he declared, not because our goods are sold more cheaply, but because they are better than similar articles of European make, or are novelties, or appeal to a special class of consumers.

Our manufacturers, protected in their home market by a reasonable tariff on imports, have succeeded in building up a foreign trade which now amounts to over a billion dollars annually in value of products sold. And this has been accomplished because of the superior quality of our goods, quick deliveries, and better selling methods. For these reasons the price of our goods in foreign markets has been maintained on the same level as at home and only a small percentage of our exports is sold abroad at a lower price than they are here.

The report of the industrial commission contained a tabulation of 416 replies to the question of selling abroad at a lower price than at home. A great majority of the answers showed that prices are no lower abroad than they are for domestic consumers, and a considerable number indicate that they are higher. In cases where a portion of the goods were sold abroad lower than at home the following reasons were given:

“Cash payments and large purchases in the foreign trade, whereas the domestic trade is based on credits and small purchases."

“The drawback or rebate of the tariff on imported raw material of goods manufactured for export."

“To overcome the tariff of other countries."
“To secure new markets."
“To hold a market against new competitors."

“To clear out surplus stock or to prevent a shutdown and increased cost of production, by keeping mills running and men employed.”

"To get rid of samples and out-of-date goods.
“Because the expense of selling and advertising is less abroad than at home.”


The fact that the expense of selling and advertising is much less in foreign countries than it is here has an important bearing on the price at which goods reach the consumer. In Great Britain and throughout Europe a great deal of the retail business is carried on in buildings which are both the store and the home of the merchant and the conduct of the business is a family affair, clerk hire and other expenses being reduced to a minimum. Rents are cheap and a small profit suffices. Many of the normal and legitimate expenses of American stores are eliminated and all the processes of distribution are carried on much cheaper than in this country.

The recent report of the tariff board on cotton manufactures gives some interesting illustrations of the difference in the cost of distribution in England and the United States. The report shows that the price at American mills of many of the coarser grades of cotton goods is as low as or lower than the mill price in England, yet the retail price is much higher in this country than in England, Thus one fabric which sells at the mills in the United States at 84 cents a yard will be jobbed at ll cents and sold at retail at 15 cents. The identical fabric in England would sell at the mill for the same price, 84 cents, be jobbed at 91 cents, and retail at 131 cents. A fabric selling at our mills at 12 cents would be jobbed at 164 cents and reach the consumer at 25 cents. The same fabric with the same mill price in England would be jobbed at 14 cents and reach the consumer at 19 cents.

The mill price is the same in both countries, but because of higher costs of distribution, larger salaries to clerks, more expensive advertising, larger rents, and a wider margin of profit, goods, the manufacturer's price of which is the same, reach the consumer here at a higher price than they do abroad. And some people foolishly blame the manufacturer for “the high cost of living."

A retail store in London might purchase from an American mill these cotton fabrics which sell at our mills as low as they do in England, and, because of cheap trans-Atlantic freight and low cost of distribution, offer these goods for sale on its counters several cents a yard cheaper than they can be bought for here; but that proves that the retailer abroad is satisfied with less profit, not that our manufacturers sell their goods for a less price to foreign than they do to domestic customers.


In 1909 the products of our mills and factories were valued at $20,672,000,000. Our exports of manufactures that year amounted in value to $671,416,000. In other words, 96.8 per cent of our manufactured products was sold to the American people, in the American market, the greatest market in the world, and only 3.2 per cent was sold in foreign countrios.

Hon. James T. McCleary, while a member of Congress from Minnesota, related some of his experiences abroad while investigating the claim that our goods are sold there at a lower price than at home. He said: “Practically without exception I found the prices of American goods higher everywhere in Europe than in the United States." In Scotland he found a McCormick binder offered for sale for $95. A new McCormick binder was selling in Minnesota at that time at about $120. On investigation he found that the binder was of a model then 4 years old in the United States and that it could be bought in Minnesota for $85.

This incident is typical of many such instances where it is claimed that our products are sold abroad more cheaply than at home. Either the article is unsalable here

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