PARAGRAPH 201-LUMBER. Are you willing to make the American lumber manufacturers purchase all their supplies, including mills and everything else involved in the cost price of manufacture, in a protected market-for a tariff we must have to support the Government-and compel the American lumberman to sell his lumber in a free-trade market? Are you willing to place the American laboring man on an equality in wages with that of the Hindoo, Japanese, Chinese, and other Asiatic labor? These are questions pertinent to the issues involved. Indeed, Mr. Chairman, I could go on and on, ad infinitum, with argument and evidence in support of my contentions and ply question after question along this line, but I think I have said enough. Upon your shoulders rests a responsibility great and far-reaching in its ramifications, which you must meet and discharge to the satisfaction of 90,000,000 people in guarding their welfare and best interests, or submit to such a rebuke in the near future as is too fresh in the minds of our people to need rehearsing here to-day. I grant you, sir, there is something akin to an insane cry for tariff reduction or readjustment, but I deny that there is any such demand for the repeal of the present meager duty on lumber, such as existed four or five years ago, before the American people realized what was involved by such a step. We therefore submit our case to your keeping, and in making this submission I would have you remember that you are holding in the hollow of your hands the destiny of the second greatest industry in the mightiest country beneath the shining sun of heaven. Move cautiously and act wisely. If the insane and reckless cry for free lumber, to which I have just referred above, is born of a misconception of the real and true situation and justice and equity to both sides, it is up to you as sentinels upon the watchtower and guardians of the public weal to measure out equal and exact justice to all men, and lead those who have been wandering in the wilderness of ignorance into paths of enlightenment. Z. W. WHITEHEAD. LETTER OF CHARLES HILL, NEW YORK, N. Y. Hon. OSCAR Underwood, Chairman Ways and Means Committee, A. C. TUXBURY LUMBER Co., House of Representatives, Washington, D. C. DEAR SIR: The following refers to Schedule D, section 201, of the present tariff law, a revision of which is under consideration by your committee. I understand it to be the policy of the incoming administration, in matters pertaining to tariff, to reduce the existing rates in such instances as they now work unduly to the benefit of the manufacturer and against the interests of our people as a whole. It is my purpose to show that the articles enumerated in the above-mentioned schedule and section can not be so considered. The importations of lumber to this country come chiefly from Canada. In the eastern portion Canada exports chiefly white pine, and in lesser degree spruce and hemlock. In her western Provinces she would export to this country largely fir and cedar products. I am chiefly interested in the competition from the woods exported from the eastern portion. Your attention is first directed to the duty on rough lumber amounting to $1.25 per thousand feet. The ad valorem duty based on the average value of the entire log product figures between 7 and 8 per cent. On approximately one-half of the product, consisting of the higher grades used chiefly for finishing and general house building, the duty would amount to between 2 and 3 per cent ad valorem, and is, therefore, of not much consequence. Its effect is further reduced by the fact that a large percentage of this lumber is manufactured to sizes used in the English market, which Canada has always controlled and to which she has adapted her sizes of manufacture, so that she will not now change and export to this country. On the other 50 per cent or more of the log product, consisting of lumber below merchantable grade, including culls, and used principally for boxing purposes, the duty would amount to something like 10 per cent ad valorem. The amount of protection afforded by this tariff rate on this coarse end of the log product affords a slight protection to the American manufacturer which can be easily justified. The cost of manufacturing logs into lumber is not determined by the quality; that is, it costs approximately the same to manufacture one log as it does another, there being a slight excess of cost, however, in manufacturing the poorer logs. It is a fact that this 50 per cent or more of the coarse end of the log product is sold at a price less than the actual cost of manufacture, Therefore, anything that can be done to PARAGRAPH 201-LUMBER. close up this gap between the actual cost and the actual selling price is of advantage to the manufacturer, and anything that is done to further increase this loss is of serious consequence to the American manufacturer. Without, therefore, going into details and reviewing figures which will probably be submitted to you, it must be obvious that the small protection afforded under the present tariff law applying to the coarser end of the product is abundantly justified and should not be disturbed. The present tariff law provides for an additional rate of duty on dressed lumber. This is distinctly in the interests of American manufacture and labor. On the American side of the Great Lakes a business has been established and conducted for a great many years along the following lines, namely: The rough lumber is shipped into these ports from Canada and graded according to the needs of the consuming trade. It is further developed in manufacture by planing mills and box factories. This business is of large volume and vast importance and the disturbance of it would result in financial loss to vested interests as well as to the mechanics employed by these mills and factories. The effect of removal of the duty would be that Canadian manufacturers would establish planing mills in connection with their sawmills and ship direct to the consuming trade in this country, thus cutting out entirely the line of American business above referred to. The advantages that the Canadian manufacturer in this line has over the American manufacturer are as follows: First. Canadian labor is cheaper than American labor. Second. The cost of construction of planing mills and box factories at the sawmills where the labor is cheap and the lumber is cheap is much less than such cost in Amer ican ports. Third. The direct shipments by rail to the American consumers would be facilitated by the reduction in weight of the lumber on account of dressing it in the planing mills, and the amount of duty which the Canadian now pays would be retained by him, so that the two points would work out to a great advantage to the Canadian as compared with the selling to the manufacturing trade as above referred to. The ultimate result, therefore, in my opinion, would be, first, a loss in revenue to the American Government; second, practically the elimination of the planing mills and box factories on the American side now dependent on Canadian lumber in the rough, with the consequent loss to the country of the labor now employed; third, absolutely no advantage to the consumer in this country, as the Canadian manufacturer would not reduce his prices, but would take to his own profit the duty now imposed upon him. I can not too strongly urge upon you the necessity for retaining the present rates, which have been reduced repeatedly and which are now down to the very minimum. Yours, truly, CHAS. HILL. VIEWS OF A. C. DUTTON, SPRINGFIELD, MASS. Hon. OSCAR UNDERWOOD, A. C. DUTTON LUMBER CO,. Springfield, Mass., January 3, 1913. Chairman Committee on Ways and Means, Washington, D. C. DEAR SIR: I am a Republican, and my business is lumber. I have been engaged in the wholesaling and jobbing of lumber for 25 years. My wholesale business at present, and for the last 10 years, is largely in (say at least 75 per cent) the cedar and fir products of the State of Washington. I am also interested, as a manufacturer, in the firm of John Fenderson & Co. (Inc.), of Sayabec, Quebec, whose production is white-cedar shingles and spruce lumber. I wish to state that I have been connected with the lumber business for 30 years as retailer, wholesaler, and manufacturer, and that owing to the tremendous amount of traveling that I have always done, feel that I am thoroughly conversant with the situation of the trade from coast to coast and from North to South. I wish to further state that I feel that I am public spirited enough to tell the truth as I see it, irrespective of my own interests. I believe the best policy for the general good of our country is absolute free trade in lumber, lath, shingles, clapboards, firs, posts, poles, and pulpwood. First. We are using up our own forests so rapidly that a policy of conservation is certainly demanded. It is surely inconsistent for our National Government to encourage the more rapid cutting away of our own forests by a tariff which tends to reduce the volume of lumber and forest products which we bring in from Canada and Mexico, PARAGRAPH 201-LUMBER. when at the same time many of our States are spending vast sums to acquire forest lands which are needed to protect our water and power supplies, as well as the future lumber supplies. Second. Generally speaking, our large forest areas are to-day held in strong hands and by large operators. This tendency is growing all the time and means constantly increasing prices of forest products. The result of taking off the tariff entirely will not be a slump in present prices, but will result in a retarded upward tendency to future stumpage prices and therefore to future lumber prices. Third. The owners of timberlands are the people who are at present benefited by the tariff, not the sawmill operators, for it is the price the timberland owner places upon his standing timber, or so-called stumpage, to the sawmill operator that fixes the price the latter has to charge for his product in order to get a profit. Of course in many sections of the country the timberland is owned by the people who operate the mills; in other sections the reverse is true. In my opinion, taking off the tariff will not reduce the wages paid to sawmill labor, at least at present, for the mills of the country are now, as a rule, overloaded with business and way behind the demand, and are unable to get sufficient labor to operate to desired capacity. Fourth. Any immediate influx of lumber to any great extent from Canada or Mexico is out of the question. The commercial activity and development of Canada is so great that stocks of lumber in that country are at present noticeable only by their scarcity. As to Mexico, conditions there are unsettled, and all trade is badly hampered, so that the present time is peculiarly propitious for tariff removal, figuring to allow the lumber producers of this country an opportunity for such readjustment to any tariff change as is always desirable. Further, in this connection I wish to state that in this country the timber resources of Canada are greatly overestimated, and that the more foresighted Canadians are already advocating the retention of Canadian forest resources for Canada, and in my opinion it will only be a matter of a comparaively few years before Canada will impose an export duty on forest products cut on Crown lands, which is the bulk of Canada's forest resources. Therefore, if the consumers of the United States are ever going to derive any benefit from Canadian lumber, it will have to be soon. The Canadians have been in the past far wiser in their handling of forest resources than we have been in ours. Fifth. Wages at present being paid in the Canadian forests and mills are practically on a parity with wages paid in this country, perhaps slightly less in Canada, but the difference is small. Eastern Canada should be compared with New England and British Columbia with Washington. Sixth. If it is the wish of the Congress to reduce the cost of lumber to the consumer, or rather to retard the further advancement of prices to the consumer as much as possible, for I do not believe the entire abolition of the tariff will at present materially reduce going prices or even hold future prices at the present level--as timber is growing scarcer all the time and the diminishing supply of raw material is bound to increase the ultimate price-then the present extra duties on dressed lumber should be removed. This will hurt a few planing mills located at such points as Newport, Vt.; Burlington, Vt.; Rouses Point, Tonawanda, and Buffalo, N. Y.; but these interests are few and great good to the consuming trade will result. Lumber is bulky and the cost of transportation is materially reduced if the lumber can be dressed at point of origin. In these days of high-speed machines, the actual cost of dressing lumber in any ordinary way, such as to plane one or two sides and match, or to plane four sides, or to match and bead, or to make so-called novelty siding, does not exceed $1 per thousand feet, and many mills are doing the actual work of putting stuff through the machines at half this cost. The point of the matter is that the maintenance of these planing mills at border-line points entails a lot of double work, so far as cost to the consumer is concerned. The manufacturer of the rough sawn boards in Canada, or, in other words, the sawmill, under present conditions has to pile his lumber for seasoning, as the border-line dressing mill will not purchase unseasoned lumber. He then has to take his piles down, inspect, load on trucks, move same to cars, tally, and load. A reasonable figure for doing this work is $1 per 1,000 feet. If there was no extra duty on dressed lumber and the (say Canadian) manufacturer could, therefore, dress the lumber at his mill instead of, as at present, selling his rough lumber to be dressed at border-line points, he could take down his piles, inspect, load onto trucks, move same to dressing machines, dress, tally, and load for a labor cost of about $1.50 per thousand feet. If the present excess tariff on dressed lumber is maintained and, therefore, the present method of border-line dressing at American mills, such American dressing mills are obliged on arrival of lumber to unload, tally, inspect, dress, and reload at a probable cost of $1.50. In other words, the present method of line dressing entails doing tallying, inspecting, and loading twice, namely: Once at original point of PARAGRAPH 201-LUMBER. manufacture of the rough lumber and again at the border-line dressing mill. The consumer has to pay the bills. I contend that this is economic waste, and that while the abolition of the extra duty on dressed lumber will certainly hurt the border-line dressing mills, yet that as these mills are comparatively few the general good demands doing away with the dressed-lumber differentials. Regarding shingles, the Payne tariff law increased the tariff on shingles from 30 cents per thousand to 50 cents per thousand. This increase appears to have been the result of a trade for votes by the administration, as there was absolutely no justification for anything but a reduction in the tariff instead of an increase. The shingle manufacturers of the State of Washington would undoubtedly like all the tariff they can get. There are a few other shingle manufacturers in other sections of the country who would also like a tariff, but practically every farmer and house owner in the United States wishes to buy his shingles as cheap as possible. The cedar timber of Washington is being rapidly cut away. Why put a premium on the more rapid use of this timber by means of a tariff on shingles? Why not allow Canada to supply us with cedar shingles in accord with natural laws? The owners of Washington timber will make money enough to satisfy them reasonably right now-with free shinglesand the supply of Washington cedar will last a little longer. Meantime, the farmers and house owners will not be forced to pay more than present prices which are high enough. The Payne tariff bill reduced the duty on lumber from $2 to $1.25. A corresponding decrease in the duty on shingles would have made the shingle tariff 184 cents per thousand instead of 50 cents as at present. The sawmills and timberland owners of the country are all making money and getting stiff prices for their products. So are the shingle mills. If the tariff is entirely taken off, present prices or profits will not be reduced provided a fair volume of demand still keeps up, for the mills are now way behind their orders and mostly engaged in marking up their price lists. The general effect of absolutely free forest products of all kinds will be, not to decrease present prices, for the laws of supply and demand will govern, and at present the supply is decidedly short, but to prevent as rapid an increase in the price of forest products as will otherwise surely take place. As an object of present interest I inclose a circular sent out to the trade by the Goodyear Lumber Co. These people are in charge of the Bogalusa Lumber Co., the largest mill in Louisiana, and are also producers of Pennsylvania hemlock on a very large scale. This circular was sent to their customers, and may be of interest if they have anything to say relative to free lumber. If I can give you any further information I shall be glad to do so. Yours, truly, A. C. DUTTON. WHY WE THINK YELLOW-PINE PRICES WILL ADVANCE. 1. Probable advance in freight rates. 2. Mill stocks generally are not over 30 per cent of what they were a year ago. 3. The demand is 200 per cent to 300 per cent greater. 4. Extreme scarcity of labor and partial victory by the timber workers and sawmill operatives organization will result in higher wages or a strike. 5. Continued pronounced car shortage, which will doubtless extend well into the new year by reason of the generally improved business conditions. 6. Excessive demand by car and railroad companies generally by reason of the immense amount of equipment orders and necessity on the part of railroads to keep up the maintenance which has been more or less neglected during the lean years through which we have just passed. 7. Scarcity of coastwise vessels with prevailing high rates will result in greater activity in securing export business, and which is freely offered. By reason of the desirability of export cutting, when a mill acquires the habit, it results in interior and coastwise business being less attractive. 8. Our Canadian neighbors are encountering a wonderful era of prosperity and there are many plans now being completed which will call for a very large amount of timber for Government docks, railroads, and canal work. 9. Talk of possible reduction in prices by reason of any possible change in the tariff, reducing or removing entirely the duty on lumber from Canada, is buncombe, as the accessible supply is closely held at high figures by the Canadian Government and, furthermore, the supply is inadequate to the present demand in Canada, resulting in large importations from this country. GOODYEAR LUMBER CO., 950 Ellicott Square, Buffalo, N. Y. PARAGRAPH 202-BRIAR ROOT, ETC. RESOLUTION OF THE BUFFALO LUMBER EXCHANGE. Mr. M. E. PREISCH, Buffalo, N. Y. BUFFALO, N. Y., January 11, 1913. DEAR SIR: At a regular meeting of the Buffalo Lumber Exchange, held this day, you were appointed a delegate to attend a meeting of the congressional committee on the lumber schedule tariff, which is to be held on Monday, January 13, at Washington, D. C., and to advocate free rough lumber, lath, and shingles, and also an ad valorem duty on lumber when dressed, as per resolution which I hand you herewith. JNO. S. TYLER, Secretary. At a regular meeting of the Buffalo Lumber Exchange, held at the chamber of commerce this day, the following resolution was adopted: 66 'Resolved, That it is for the interest of the lumber trade and of the public in general, that lumber in the rough, also shingles and lath, be admitted into the United States free of duty, and that there be an ad valorem duty on lumber when dressed." JNO. S. TYLER, Secretary. PARAGRAPH 202. Briar root of briar wood, ivy or laurel root, and similar wood unmanufactured, or not further advanced than cut into blocks suitable for the articles into which they are intended to be converted, fifteen per centum ad valorem. BRIAR ROOT, ETC. BRIEF OF WM. DEMUTH & CO., NEW YORK, N. Y. COMMITTEE ON WAYS AND MEANS, House of Representatives, Washington, D. C. WM. DEMUTH & Co., SIRS: Permit us to call your attention to item No. 202, Schedule D, briar root or briar wood, a raw material which was taken from the free list and subjected to a duty of 15 per cent ad valorem under the tariff law of 1909. This material was taken from the free list and made dutiable at the solicitation of the American producers of ivy or laurel root (which in appearance is similar to imported briar wood) as a protection to their product. We have always contended that the domestic wood can not be used as a substitute for imported wood in the manufacture of pipes, because of the fact of its fiber being of a nature that will not withstand the intense heat of burning tobacco, the pipe, in consequence, burning out much more readily. This contention has been upheld and the fallacy of the intended protection to the producers of ivy or laurel wood has been proven by the fact that since the enactment of the present tariff law the consumption of the domestic wood has not increased one iota. It is self-evident, therefore, that the duty on imported briar wood as a protection to the American industry is not consistent. As a matter of fact, it is a discrimination in favor of the foreign manufacturer of pipes as against the American manufacturer of pipes, the foreign manufacturer having already, under the present rate of duty on finished smokers' articles, made sufficient inroads upon the commerce of the American manufacturer before the duty had been imposed upon the briar wood. We therefore respectfully submit that imported briar wood or briar root be returned to the free list. Respectfully, yours, WM. DEMUTH & Co., OBJECT TO DUTY ON BRIAR ROOT. MANHATTAN BRIAR PIPE Co., Jersey City, N. J., January 6, 1913. Mr. EUGENE F. KINKEAD, Member of Congress, Ninth District of New Jersey, Washington, D. C. DEAR SIR: We are interested in paragraph 202, Schedule D, which imposes a duty of 15 per cent on briar root. We have been informed that the object of putting on this duty was to encourage the use of laurel root grown in North Carolina and Tennessee. We endeavored to conform |