by Mr. Griggs, that the difference between the price of board lumber at the present time and the price ten years ago was $10 a thousand? Mr. ROGERS. I am not taking the maximum price. That is a maximum price for the last two years.

Mr. GRIGGS. I asked you as to the average.

Mr. ROGERS. That is what I understood. I took the maximum and minimum for ten years.

Mr. BOUTELL. The only point I am trying to get at is this: Even with the ultimate consumer getting the full benefit of a $2 reduction, we would still be $8 ahead on account of something besides the tariff over what we were ten or twelve years ago?

Mr. ROGERS. I guess I am rather dense, but I do not quite follow

you.

Mr. BOUTELL. I give this simply for the purpose of illustration: If lumber to-day is selling for $10 a thousand more than it was ten years ago, and we repeal the duty so that the ultimate consumer gets the entire benefit of the reduction of $2, he would still then be up to $8 a thousand more than he was ten years ago.

Mr. ROGERS. Unquestionably. That is simple subtraction-two from ten is eight.

Mr. BOUTELL. But the point is this, that some other factors besides the tariff had to do with the raising of the price of lumber, and that the ultimate consumer is not going to get back to where he was twelve years ago by a reduction.

Mr. ROGERS. He never will. The price of lumber will never go down to where it was ten years ago.

Mr. FORDNEY. If the price of lumber on the Pacific coast is $10 higher than it was twelve years ago, then he must be getting $20 higher than it was then?

Mr. ROGERS. The price of lumber on the coast I do not believe is $10 higher. But the coast is not the only factor. There are other localities that you must consider. I think in Minneapolis it is more than $10 higher.

Mr. FORDNEY. How about the South?

Mr. ROGERS. I am not familiar with the South, and I do not know anything about it.

Mr. FORDNEY. As compared with the whole manufacturing product of lumber in the United States to-day, is Minneapolis only a small portion?

Mr. ROGERS. It does not cut much figure any more.

Mr. FORDNEY. Then that is not a fair statement as to the average? Mr. ROGERS. Not any more than taking the Pacific coast as an average of the whole thing.

Mr. FORDNEY. A very large quantity is cut on the Pacific coast.
Mr. ROGERS. Not as much as in some other districts.

Mr. FORDNEY. Where, for instance?

Mr. ROGERS. In the South.

Mr. FORDNEY. What is the difference in proportion, Mr. Rogers? Mr. ROGERS. In the production?

Mr. FORDNEY. Yes; between the Pacific coast and the South.

Mr. ROGERS. I do not know.

Mr. FORDNEY. But you know that it is greater in the South?
Mr. ROGERS. Yes; I believe it is. Don't you?

Mr. FORDNEY. I do not think it is.

Mr. ROGERS. I am not positive. I would not be positive about that, because I do not know. But I am simply judging by running through my mind the manufacturers that I know in the South.

Mr. CLARK. Isn't it true that white-pine lumber is so high that it has driven people to using sycamore, cottonwood, and other soft woods for inside finishings, that ten or fifteen years ago were considered absolutely worthless?

Mr. ROGERS. There is no question about that in my mind.

Mr. CLARK. You state it as your opinion that lumber will never be as cheap again as it was ten years ago. That grows largely out of the fact that the supply is diminishing, does it not?

Mr. ROGERS. That is the reason.

Mr. CLARK. The price of lumber is driving people to use concrete and other substances in place of white pine in the building of dwelling houses?

Mr. ROGERS. That is our experience; get less lumber business each

year.

Mr. CLARK. Is there a lumber trust, or is there not?

Mr. ROGERS. I do not believe there is.

Mr. CLARK. How does it happen that these men who manufacture keep the prices up to a certain equilibrium all the time? Is that accidental, or is there a scientific reason for it?

Mr. ROGERS. The manufacturer is here and he will answer that question himself.

Mr. CLARK. If you do not want to answer, all right.
Mr. ROGERS. We are buyers.

Mr. Pou. Under which condition do you think the destruction of forests is greater, under high prices or low prices of lumber?

Mr. ROGERS. We are stumpage owners this side of that line. If the price was high we would like to produce that into lumber and get the profit. If our policy would be that of other people, I should say the high price would tend to reduce the amount of available supply. That would reduce the carrying charge on a product when the price gets above a certain point. Then you get your profit if you sell, and you would rather manufacture than carry that investment if you figure that the profits on that investment would be much greater than the profits of manufacture.

Mr. Pou. Which condition do you think would stimulate the free owner, high prices or very low prices?

Mr. ROGERS. When lumber gets down, or when any other commodity gets down below the cost or near the cost of production, the natural tendency is to stop production. I should suppose that would apply to manufacturing lumber as well as anything else.

STATEMENT OF MR. F. B. LYNCH, ST. PAUL, MINN.

Mr. LYNCH. Mr. Chairman and gentlemen of the committee, I am here as an American interested in the upbuilding of the Northwest, where I own large tracts of real estate, as an American interested in the manufacture of lumber in Canada, and as an American who also owns timber in the United States. I believe that the greatest good for the greatest number of people will be helped by the removal of the tariff on lumber coming into this country. Whatever tends to reduce the cost of making homes for our citizens tends to make them better citizens.

I do not think the removal of the duty will reduce the price of lumber which now prevails here. The Canadian manufacturer with his higher cost of production can not sell lumber in the American market to-day any cheaper than the American manufacturer sells it. But if the price of the product should again go up to the point at which it was two years ago and where it was for several years prior to that, a Canadian manufacturer could come into this market and sell his production in competition with the American manufacturer, and greatly to the benefit of the American consumer. It is possible that at the prices which then prevailed he could undersell the American manufacturer.

I am not well enough posted on lumber conditions on this side of the line to give much information concerning the cost of lumber here. I can tell you a good deal of the cost of production, the cost of stumpage, the cost of erecting sawmills and of operating them, and the price of labor on the other side of the line. I am now and have been for several years past one of the principal owners of two of the largest mills in western Canada, namely, the Red Deer Lumber Company, at Barrows, Saskatchewan, in the spruce district, and of the Elk Lumber Company, at Fernie, British Columbia, in what is known as the mountain district in British Columbia. Each of these mills has a capacity of about 35,000,000 feet per annum. Each of these mills, with their planing mills, yards, logging equipment, and other necessary improvements, cost us about $100,000. This is exclusive of the cost of our standing timber.

I have been told by men who own similar mills on this side that their plants and equipment here cost about $250,000. The difference in cost is accounted for by the tariff charged by the Canadian government on the American machinery with which our mills are equipped, the high freight rates which we have had to pay on this machinery, the high cost of labor which prevails there, and the lack of efficiency of the Canadian mechanic as compared with the American mechanic.

Our logs at the Red Deer mill, where we are sawing spruce exclusively, cost us at the mill $7 per thousand. Our stumpage at this mill, together with the royalties paid to the Canadian government, costs us about $3 per thousand. At the Elk mill, where we saw cedar, fir, and spruce, our logs cost us $6 per thousand. Our stumpage at this mill, together with the royalties paid to the government, costs us $1.50 per thousand. Our cost of manufacturing, including the cost of surfacing, piling, loading, selling, insurance, interest, and taxes at each point is about the same, viz, $5 per thousand.

We employ no oriental labor in any capacity or place. Most of our employees are Americans. All of our highly skilled employees, including our manager and superintendents, learned their trades or business on this side of the line. They went to Canada for us because we were willing to pay them higher wages than they were receiving here. We were willing to pay these wages because these men were more efficient workmen than we could get on the other side and would do more and better work than the Canadian workmen. They were cheaper for us than Canadian workmen at lower wages, but were no more efficient than the thousands of American workmen employed on this side in American mills, and who, I believe, receive lower wages than we are paying these men.

Mr. LYNCH. I have a statement here showing the average wages paid at the mills of the Elk River Company, at Fernie, British Columbia, and of the Red Deer Lumber Company, at Barrows, Saskatchewan. Perhaps you would not care to have me read this table, and if not, I will pass that and continue my statement.

The CHAIRMAN. Do you mean wages by the day, hour, or how?
Mr. LYNCH. By the day.

The CHAIRMAN. State the number of hours.

Mr. LYNCH. Based upon ten hours a day.

The CHAIRMAN. And how many days in a week?

Mr. LYNCH. Six days in a week.

The CHAIRMAN. No half holidays?

Mr. LYNCH. No half holidays.

The CHAIRMAN. You have not a statement of the wages paid in the American mills, have you?

Mr. LYNCH. I have not; no, sir. I will file this statement.

Mr. GAINES. How long is the statement?

Mr. LYNCH. It is somewhat less than a page.

The CHAIRMAN. I think perhaps you had better read it.

Mr. LYNCH (reads):

Average wages paid at the mills of the Elk Lumber Company, at Fernie, British Columbia, and of the Red Deer Lumber Company, at Barroirs, Saskatchewan, for the years 1903 to 1907, inclusive,

During the same period the same mills have paid wages to their men in the woods, they doing all of their own work and doing no logging through contractors.

The superintendent receives $1,600 to $2,000 per annum.

All men working in the bush are paid so much per month and their board. The figures given above for their day labor is the amount which they would receive per day, figuring twenty-six working days to the month and adding the cost of their board, averaged in nine different camps, to the daily wage paid to them.

The CHAIRMAN. Have you any extra copies of that statement? Mr. LYNCH. I have none with me, but I can furnish you some. The CHAIRMAN. If you will kindly let me have the statement, I will have some copies made for use of the members of the committee. Mr. FORDNEY. How do those wages compare with the wages paid now?

Mr. LYNCH. Those are the same wages that we are paying now. Those are the figures up to July 1, 1908.

I do not think that the wages which we pay are much, if any, higher than those paid by our Canadian competitors. Our scale may be higher in some instances, but it is made up by the increased efficiency of the workmen we employ. I think these wages are higher than those paid by most American plants and are only equaled by a very few of the best inland empire mills.

In the matter of stumpage and its cost on the Canadian side, I would say that it varies greatly, as it does on this side, according to its nearness to market, the facility with which it can be logged, the character of the timber, and the danger of fire. All of the timber in Canada, however, carries a minimum royalty to the government of 50 cents per thousand, board measure (this is equal to about 70 cents per thousand, log scale), and from that up to $6 per thousand in royalty in some of the eastern provinces. In British Columbia the prevailing royalties are 50 and 60 cents per thousand. To these royalties, to find the cost of stumpage, must be added the bonus which is paid to the Dominion government when the license to cut the timber was issued by the government, and which amounts, according to the competition which prevailed when the timber was sold by the government, to from 15 cents to $2 per thousand. This bonus is paid to the government in cash when the timber is sold, while the royalty is paid to the government when the timber is sawed. We also pay a royalty to the government on all of our by-product-, including lath and shingles.