gave to the President the authority to negotiate in good faith with other m tions for mutually advantageous reduction of tariff and trade barriers, marks a high point in the conduct of international relations. When the great economie treatise of Adam Smith, appearing at the same time as our Declaration of Independence, sounded the death knell of the old theories of the mercantilists the way was opened for the utilization of the channels of international trade as an additional method to enhance the general welfare by international specialization. Prior to that time, it was an accepted and advocated pattern of conduct for each nation to seek to build itself and its "treasure" at the expense of other nations. This pattern involved the use of all manner of restrictions designed to bring about what was called a favorable balance of trade. In simple terms, this meant the maximum balance of "treasure" or gold which could be obtained by exporting more than was imported and demanding the remittance of that balance in gold. That this policy would necessarily involve the uneconomic preduction of many goods in the Nation was admitted and defended. It was also admitted that it would require that less be bought from overseas markets than the free market would allow. Thus it was that all manner of quotas, exclusions, tariffs, and curtailments were advocated as instruments of national policy for this combination would, for each individual nation, increase its sterile stock of what was called treasure. Then came Adam Smith who wrote, not about the maximization of sterile bullion but rather the "wealth" of the Nation.

This wealth was accounted for and measurable by weight, tally, and count to some degree it is true, but its better measure was the "wealth" or well-being of the inhabitants within the state as opposed to the wealth or treasure in the coffers of the king. The achievement of this end, as viewed by Mr. Smith and virtually all economists since he began the school, was to be achieved by the division of labor and the specialization of production. This would enable each producer to give his attention to that field in which he excelled and, by creating more, also exchange that output for more and better things produced by other specialists. The simple validity of this process of free exchange has never been denied.

This is not to say that the principle of the unfettered movement of goods has reigned as an inviolate law although it did come to pass in 19th century England. Mercantilistic thought did not pass quietly into oblivion and it lives strongly in this day, just as it lived even more strongly in 1930. Perhaps the greatest exponent of this doctrine, outside of our own Alexander Hamilton, was Frederich List who wrote and pursuaded at about the same time. His thesis was, and it has suffered no major change just as Smith's has not, that there were sure and peculiar advantages which would accrue to a nation if it protected certain domestic industries such things as necessary infant industries, those which would materially aid in the utilization of available resources and so forth Modern argument is still cast in these old terms. On the one hand, unhampered trade will allow the flowering of the principle of division of labor and specializa tion of production which, operating through a free market, will give the greatest return to the greatest number of citizens. On the other hand, a careful policy of selective protection for vital industries will maximize the welfare of the nation, and thereby its peoples, by avoiding a dangerous and costly dependence upon nations overseas for supplies and materials needed in time of war and prevent various sorts of "economic" wars.

It is, I am sure, too much to hope, that this conflict will ever cease as the exponents of each case seem always to find new ammunition to fire at old targets. However, there always exists the hope that the extremes may be brought inte a workable balance so that the national welfare may suffer less from changes in the pattern of conduct. At this moment, this Nation has a peculiar chance to weigh these issues and come to agreement as to the most useful long term policy. I say it is peculiar, and say it because we stand again at a point of decision. The trade-agreements program, that is negotiation of mutual reductions, bas been our policy since 1934 and under that policy we have reduced many tariffs. Now Congress has been requested by the President to extend this policy for a year while a thorough study is had of our foreign economic policies. I under stand that Congress is to participate in this study and well we should, for ours is the job of determination.

However, this is but a part of the story of why we stand at a point of decision The whole story involves our inheritance of the mantle of leadership of the free nations and the existence in the world of a powerful and unprincipled force dedicated to the conquest, by one means or another, of the nations not now in

ts orbit. The best short summation of the problem is found in the popular logan, "Trade, Not Aid." This slogan is to be worked into a major part of he present cold-war strategy. This is necessary because one great hope of the asters of the Kremlin is that the non-Communist nations will engage in a great rade war which will lead to divisions or war which will enable them to step ito vacuums as they have in the past and absorb other nations. This must be revented at all costs as economic policy, trade policy, military policy, and sychological policy is welded into an instrument which will, in the long run, tymie the aggression of the Communists.

Since the ending of World War II, this Nation has engaged in a historic policy f help for battered nations so that once proud nations could rebuild from the shes of total war. We have dedicated billions to this cause and thus far, have revented the further encroachment of communistic imperialism except in areas here force was a factor. We have however, passed the point where we can ontinue to pour out treasure for the upkeep of free nations. We have, on the ontrary, come to the point of the slogan, where what is needed is trade and not id. The war-shattered economies of Europe have been rebuilt for both former ›e and wartime ally and now these economies must move into the markets of the orld and exchange one type of goods for another, exchange what they produce ›r that which they cannot produce. We are all aware that much of this exlange process before the war flowed from Europe to areas now under Communist omination and from those nations to Europe. No longer is this an advantage > the free nations for most of them are participants, to some degree, in the rst united effort against aggression. It has been determined by free people at no longer will small aggressive ventures be allowed to grow into great and rrible wars and so it is that we fight in far-off Korea, not for territory but for n idea and for a means of preserving freedom elsewhere.

And so it is that we have a choice; a choice between a continuation of taxreated gifts to Europe and the Far East to sustain their economies in the absence f normal trade channels, or a pattern of trade which will enable them, one with nother, to produce and exchange and sustain themselves by their own resources. f we fail to provide a trade pattern for our ally Japan to replace the prewar attern of trade with what is now Red China, then we can either pick up the ib with tax dollars or watch the inevitable forces of economic life turn her to ade with this part of the communistic empire while other free nations fight on the field. This we cannot do. Our resources and our tax sources are not > inexhaustible that we can drain them forever without return. We cannot lways export the fruit of our soil, the product of our mine and well, the sweat f our labor, and the funds of our taxpayer, without bringing upon ourselves a ype of bankruptcy, a bankruptcy of resource.

Thus it is that we must sit down as Americans and decide which way we are O go. We must do this from a national point of view and this achievement alone ill require the best that is in us. Too often in the past we have made these ecisions on the basis of an agglomeration of smaller viewpoints. The stakes re now too high for this. The view must be national, must be that which, while urting some, will nonetheless maximize the gain to all.

In this connection, I find myself in support of section 13 of H. R. 4294 which ill be decried by many as a sectional interest. This I will not necessarily deny ut I shall try to put it into context. This is the section or provision which stablished a sliding scale or equalization import fee on lead and zinc, both netals which are necessary in peace and vital in war. I spoke of a national ́iewpoint, one which would insure a maximum return to the citizens generally. have not strayed from this path even though it might be possible to achieve hese ends by other means. What is sought by this provision is simply a means vhich will insure a minimum of production of lead and zinc within the confines of this Nation. Does this have an importance to the general welfare? I think t does.

We live in an uncertain world in which war, total war, may come without iny warning. That war must be fought with raw materials, with factories as well as with men. If, in the short run, in the pursuit of the desirable tenet of Duying in the least expensive market, we thereby cause the closing of primary mines all over this Nation, then we have "paid too much for our whistle" for we will have lost more than the mines alone. We will have dissipated the highly skilled labor force, the technical and managerial know-how, we will have allowed mine shafts to flood, to cave in, the mining communities to close down, the equipment to rust, and the whole going concern to die. Any businessman,

miner or not, can tell you the value of "going concern." Any businessman wil pay more for an operation which is "going," which has a skilled staff, a clientele, accumulated know-how and the many components of a concern other than its mere fixtures, stock and buildings.

Now, this is something which is important not because it might happen but because it has happened already. The Small Business Committee will soon return from a series of hearings in the West. The record of those hearings will be replete with the almost criminal record of the closing of lead and zine mines all over the Nation because of a depressed price structure. For the most part, this depressed price structure is the outgrowth of a great increase in supplies brought about by the pull of demand which followed, as usual, the demands of the Korean war and of defense generally. The same old bust is following the boom. The short-run fluctuation is killing the long-run goose that must lay the eggs in far-off tomorrows as well as today. I shudder to cotemplate the prospect of a war's demand for lead and zinc (not to mention a whole host of other metals and minerals) if we allow the current depressed situation to become "normal." It could mean little but ruin.

It is my personal opinion that this necessary production of at least a minimum of vital metals and minerals from safe domestic sources could be met in ways having less impact on this national trade policy. However, this is the only amelioriative legislation actively being considered by the Congress or by the administration so far as I am able to determine. The national welfare in a defense period demands some action and this 1 support as one sure way, and perhaps as well, a way which will create pressure for alternative plans.

I should like to mention these alternatives, of which there are four, and in order of my preference. First, a program of incentive benefits which would bring the market price to parity just as this import fee will do. Second, the first failing of adoption, then a direct and open subsidy to achieve parity. Third, a program similar to the commodity credit operation of the farm parity support program with loans and other aids, and last, all else failing, a pure tariff of such magnitude as would insure a going domestic mining industry.

I wish to close by again emphatically pointing out that I am talking here out of a firm conviction that the national good must have first consideration in our time as we seek, with other free nations, to find common ground for the long pull against aggressive communism. I am not talking from a partisan point of view either as to party or as to industry for I know only too well that this testimony will not create friends in partisan quarters. Such is not my purpose. If we are to demonstrate that the free way is superior to alll others then we must do just that and forswear the luxury of sectionalism or emotionalism. If we fail we may well find that we have failed to preserve freedom and without freedom, what advantage exists in anything, even life itself?

Mr. DINGELL. Mr. Aspinall, I know how jealously you regard that Colorado terrain. Is this a part of your tribe here, all these witnesses?

Mr. ASPINALL. Not all of these witnesses are mine, but I own a great many of them.

Mr. DINGELL. But you will take them under your wing?

Mr. ASPINALL. Absolutely, Mr. Dingell.

The CHAIRMAN. We thank you very much for your appearance and your statement.

The next witness will be the Honorable William A. Dawson, of Utah.

Is Mr. Dawson in the room?

(No response.)

The CHAIRMAN. The next witness before us will be the Honorable Ed Edmondson, of Oklahoma.

Of course, we know you and are glad to see you here. If you will just give your name and the capacity in which you appear, we wil be glad to hear you.

STATEMENT OF HON. ED EDMONDSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF OKLAHOMA

Mr. EDMONDSON. Ed Edmondson, Member of Congress from the Second District of Oklahoma.

I appreciate very much this opportunity to appear in behalf of the lead and zinc provisions of the Simpson bill.

I would like to begin by making a correction in a preliminary report on zinc in Oklahoma which I filed with the chairman of this committee back in April. At that time I gave to this committee figures on importation of zinc into this country, quoting from Representative Metcalf's figures that there were 450,000 tons of zinc imported nto this country in 1952. The latest figures, however, of the United States Tariff Commission have just become available to me, and they show that zinc imports for 1952 amounted to a total of 699,000 tons, of which 599,000 tons were duty-free.

Exports, on the other hand, amounted to 62,000 tons during that ear, leaving an import balance of 637,000 tons, which came in in

1952.

I think that I can reiterate even more strongly the conclusion in hat report which I supplied to the committee earlier, that this trenendous import figure must have had a decisive effect upon the great. reak in zinc prices which took place in June of 1952, when the price on zinc began its downward slide which has not stopped up to this ime.

There were seven conclusions pointed out in this earlier report, which I think should be emphasized in connection with the near lisaster conditions that prevail in the tristate mining area.

The first of these is the fact that a majority of the mines normally perated in this area and engaged in zinc and lead mining are now hut down. One of the witnesses appearing from the tristate area. vill give to this committee the very latest figures showing the great xtent of this shutdown, and showing also the fact, as pointed out n the second conclusion of this report, that several thousands of ainers and mill workers have been thrown into unemployment or intother lines of work.

The third conclusion in that report deserves emphasizing again, ecause it is a condition that is creating near depression conditions. n this area, and that is that the miners remaining on the job have een their hourly pay drop an average of 472 cents in the last 6 or months. That means that the purchasing power of these minersvho still are on the job is declining rapidly in a period when we are ot seeing any comparative decline in prices of the things that they ave to buy.

The fourth of these conclusions is the fact that there is a terriffic ost of pumping which is being taxed upon these mines that are not ven operating today, estimated at figures that I have heard anywhererom $90,000 to a quarter of a million dollars over a year's period, or the cost of power alone to carry on this pumping in these shutlown mines.

I think it should be emphasized to the committee that the value of hese tristate mines which are in danger of being flooded unless omething is done to return them into production, cannot be measured

in terms of quantitative production alone, because this Prime Western ore has highly specialized uses in industry, and that makes this region doubly important to our industrial picture.

The sixth point I have brought out in this report and would like to emphasize again is that lead, which is an essential to defense in this atomic age, can only be mined efficiently in this area as a byproduct of zinc, and if we flood these zinc mines we are going to lose those valuable lead ores, also.

Finally, the importance of this area to America's war potential is something that cannot be overemphasized. I think if we permit the loss of these valuable lead and zinc ores in this critical time in world affairs, we certainly are risking grave danger to America's war effort in the event we do become involved in an all-out shooting war. Mr. Chairman, I will not take further time of the committee, excep to appeal to this committee to give careful consideration to the testimony of Mr. Childress and of Mr. Kaiser, who are fresh from the scene and can give to this committee the very latest figures on this picture.

I would also like to ask permission of the committee to place in the record a letter which I received only yesterday from the President of the United States, in which he agreed with me that there was a very serious situation there, and that something would necessarily have to be done to take care of it if it was possible to work out some feasible plan to do it.

The CHAIRMAN. Without objection, that letter may be included 25 part of your testimony. Would you like to include any of the doct ments you have there as a part of the permanent record?

Mr. EDMONDSON. I think that this report has already been made available to the committee. I would like to ask permission that t be placed in the record of the hearing.

The CHAIRMAN. Without objection, it is so ordered. (The report and letter referred to follow :)

PRELIMINARY REPORT ON ZINC IN OKLAHOMA, BY REPRESENTATIVE ED EDMONDSON, SECOND DISTRICT, OKLAHOMA

Conditions in Oklahoma's zinc mining area-an important portion of the vital tristate mining region which at one time supplied 60 percent of America's zie production-must be rated crucial on the basis of a preliminary survey just completed.

At stake is an integral part of an industry which is definitely critical in any all-out war effort by our Nation. The importance of zinc in the manufacture of automobiles, guns. and ammunition—and the resulting importance of safe guarding and maintaining our domestic zinc supply-cannot be overemphasized in any objective valuation of America's wartime strength.

Several months ago, I began to receive danger signals from the industry in Oklahoma's Second District. Due to steadily declining zinc and lead pries (lead rating as an important byproduct of zinc mines in the tristate region increasing numbers of mines and mills were shut down by their operators.

In late March, I received the alarming report that 60 percent of the smal mines in the tristate area had been shut down throwing more than 4,000 mines millworkers and employees of related businesses out of work.

On March 30, these reports were personally relayed to President Eisenhower. who expressed deep concern over the problem and asked for more detailed infor mation, as well as recommendations from the industry..

The Easter recess of Congress afforded an opportunity to return to Oklah 'for a firsthand survey of the zinc and lead situation in the northeastern secti of the State, adjoining the Kansas and Missouri zones of the tristate region. On April 10, at Miami, and April 11, at Muskogee, I talked with large numbers