spring buying in several districts. Welded steel pipe again competed in largeline projects. A notable tendency developed in ordering larger sizes of cast-iron pipe, particularly 12 inches and over.

The break in prices in July, 1927, carried over until March, 1928, when producers succeeded in strengthening the Birmingham base quotation. Late in 1928 the Birmingham quotation for the larger sizes had reached the level of the peak in March and April, 1927, at $38. In the last half of 1928 prices were $4 to $5 a ton above the average of the last half of the preceding year."

The production of any commodity is dependent on mass production and the economies which can be derived therefrom, and we believe that the peoples of the United States should benefit in every possible degree from the highly economical production of cast-iron pipe in France, so long as this is not detrimental to the industry in the United States, in a similar manner as the people of France benefit from mass and economical production in the United States of automobiles. At the present time the imports to France of American goods, in dollars and cents, are approximately two and one-half times the imports of French goods to the United States, and it is an admitted economic fact that reciprocity in trade is the only method of insuring payments of debts.

It is true that Pont-a-Mousson foundries were completely destroyed by the German guns and it was only natural that they should be reconstructed in accordance with the most modern practice. This is the main reason why the cost of production in our foundries is less than in most of the American foundries, which are not so up-to-date. Another outstanding reason is, that Pont-aMousson foundries own their coal and iron mines and make their own pig iron, just as American steel makers do. American taxpayers should not be penalized because American cast-iron pipe manufacturers do not conduct their foundries on the most economical basis, from the fact that, not having blast furnaces, they have to purchase their pig iron from the United States, France, England, and Germany, which, being sold at a profit by the furnaces, increases the cost of their production. All cast-iron pipe foundries in the world, with exception of the United States, own their blast furnaces and this applies to British, French, German, Spanish, and Japanese. If the American foundries were producing their own pig iron, this fact alone would prohibit foreign importation.

As a matter of fact, the 20 per cent ad valorem duty, which now exists under paragraph 327, amounts to approximately $4.50 per ton for 6-inch pipe, but it should be borne in mind that, before we are in a competitive position with American foundries, we have to pay the following items: $2 railroad freight from foundry to Antwerp; $4 ocean freight and insurance from Antwerp to Atlantic seaboard; $1 brokerage, inspection, and various other minor charges, making a total of $11.50 per ton, exclusive of sales commissions and wharfage.

If the United States foundries are not in a position to meet competition, which has charges amounting to $11.50 per ton on an average price for 1928 of $37.11, they are surely being operated on a very uneconomical basis. That this is not the case, however, is very clearly evidenced by the earnings of the largest company in the industry, namely, the United States Cast Iron Pipe & Foundry Co., which, in 1927, earned 21.7 per cent on their common stock and are paying dividends at the rate of 10 per cent on that same stock at the end of 1928.

This fact, together with the article above cited from the Iron Trade Review, would indicate that imported competition has very little to do with the marked changes in the price of cast-iron pipe, notwithstanding the remarks of the domestic producers, as to their being at the mercy of European foundries and, furthermore, the paucity of the orders taken by us in 1927 and 1928 would entirely repudiate the statement that "if we want to take an order, we take it."

We take most strenuous exception to the remarks of Mr. Wood, as to our selling pipe in this country at 50 per cent less than the fair market value and would positively state that the books of Pont-a-Mousson foundries have been examined at the instigation of United States manufacturers several times and that, on these occasions, all our records were laid bare to the inspecting officers and that in each instance we were shown to be exporting at a price not less than that at which we were selling at France.

Furthermore, the fact that Pont-a-Mousson foundries export more than 75 per cent of their output is the best proof that they do not practice dumping.

Referring now to Mr. Bacharach's remark, we would point out the following facts: That, whereas the price as shown in the Iron Age for the month of October for American manufacture is $35.60 per ton and that the price, f. o. b. foundry in

France, is $22.91 per ton on 6-inch pipe, we have to add to this, instead of a transportation of $3.40, the following items:

making a total of $37.87 f. o. b. New York yard, which compares with the domestic price of $35.60, or $2.27 higher than the domestic price. This is borne out by the fact that we have never yet been able to secure business in New York City.

Continuing to amplify the questions following Mr. Wood's brief, we would state very definitely that Mr. Wood can use water transportation in the delivery of his pipe, as instanced recently in Providence, R. I., where he showed a difference in his price of $3 per ton on water delivery, as compared with rail delivery.

Mr. Wood, in answer to question by Mr. Watson, has stated that "it all depends on how much importers are willing to give up of the $35 or $37 or $38 they get in France, in order to get an order in America. They can go anywhere." It has already been shown by Mr. Bacharach that the price in October, which the French manufacturers were securing in France, was $22.91. We would like to mention here that in 1914, Mr. Wood went over to Italy and, in spite of French, Italian, German, and British competition, secured an order for over 30,000 tons, which only the war, which broke out a few weeks later, prevented him from making delivery.

From records shown in the Iron Trade Review issue of January 3, 1929, No. 3 pig iron, in France, averaged in 1928, 442 francs, or $17.33 per metric ton of 2,200 pounds, which is slightly less than the gross ton which is quoted in the same journal at $16 per ton for Southern No. 2 foundry pig, f. o. b. Birmingham, Ala.

Referring now to Mr. Russell's brief, the figures cited by him, in regard to the variation of French prices, may be correct but he intentionally or otherwise omitted to point out that the prices of pipe vary very considerably according to the diameter of the pipe. For example, 4-inch gas pipe is ordinarily sold by American foundries at a price never less than $8 per ton over the price of, say, 30-inch water pipe. The declared value of $18.75, cited in the first paragraph, page 1488, applied to 30-inch and 48-inch pipe, while the price of $26.90 in New York applied to small diameter pipe.

Cast-iron pipe was first made in France and the example of 250 years' life, cited by Mr. Russell, applies to pipe made in that country under Louis XVI, which is still giving good service. This may be one of the reasons why American consumers continue to appreciate French pipe and welcomed its appearance in this country. As pointed out in the criticism of Mr. Wood's statement, it is due to the fact that they make their own pig iron, instead of buying it in the open market, which is simply a question of economical foundry practice.

In the table of declared values per ton, submitted by Mr. Russell, the differences are almost entirely due to different diameters of pipe, as previously mentioned.

Referring now to the examples of fluctuations, we would criticize these as follows: (Mr. Russell's brief printed at p. 1492.)

1. Amarillo, Tex. This was not only competition between two makes of castiron pipe but also included the competition of steel and concrete pipe. The United States Cast Iron Pipe Co., the only one able to fulfill such an important contract of 30-inch pipe, did not seem willing to compete against steel and concrete and quoted a price considerably higher than the prices they were ordinarily quoting at that time.

2. Somerset, Mass. French pipe was only 4 per cent under the American price and secured the order, which would indicate that American consumers think well of the French pipe.

3. Detroit, Mich. In this instance, we secured the contract with only a difference of 1 per cent, which again speaks highly for our product.

4. Warwick, R. I. The price quoted by us was in line with the market at the time the bids were taken and we can intimate that American foundries bid, two weeks prior to this, on a small order of two carloads, a price of $38 per ton, delivered in a near-by locality.

The duties, which Mr. Russell is asking, would, if approved, represent the following figures:

1. A total duty of $12.12 per ton, in the case of 20 per cent ad valorem on the American valuation, at the port of entry, plus one-fourth cent per pound.

2. Ten dollars and sixty-eight cents per ton in the case of 30 per cent ad valorem.

Figured on an American price of $35.60 delivered New York.

3. Fifteen dollars per ton in case of foreign valuation being retained.

The wide difference between these three rates would indicate that the American manufacturers are not very well informed as to the protection they claim they require to check the very meager import of French pipe into the United States. The above rates would represent an increase of from 250 per cent to nearly 400 per cent on the existing rates. Needless to say, that would absolutely prohibit the import of cast iron pipe and the American taxpayers would very soon experience a revival of the high prices, which prevailed before the appearance of French pipe into this market.

As a matter of information, the following figures are an abstract of statistics published a few weeks ago by the Iron Age:

For your information, we would state that it was in 1924 that we commenced importing cast iron pipe. Respectfully submitted.

THE HERBERT KENNEDY Co. (INC.).

The COMMITTEE ON WAYS AND MEANS,

NEW YORK, January 23, 1929. House of Representatives, Washington, D. C.

SIRS: The Herbert Kennedy Co. has requested us to supplement their brief with the following statement of which we have knowledge from our files of our appearances as counsel in customs matters for the Pont-a-Mousson foundry. Mr. Wood stated at page 1479:

"The protection that we have is 20 per cent on the foreign valuation. The foreign valuation is this: For domestic consumption in France they sell their pipe at about 80 per cent profit. They export their pipe at about 50 per cent less. I believe you can readily see how unbalanced the conditions are."

In addition to the price at which the goods are sold and delivered in the United States Pont-a-Mousson declares upon their consular invoices the price at which they are selling similar pipe in France, and it is so appraised for dutiable purposes by the United States appraiser.

Importations at Charleston on January 12 and March 13, 1926, were advanced in value by the United States appraiser to a higher foreign value than that declared by Pont-a-Mousson upon the consular invoices, and on appeal to the United States Customs Court upon evidence of sales made in France, the court sustained the declarations of Pont-a-Mousson, and reversed the action of the appraiser.

(See Reappraisement Circular No. 11, dated December 17, 1926, publishing reappraisements by the United States Customs Court under Published No. 328, before Justice Fischer. Thirty-inch pipe declared at francs 550, appraised at 650, and 24-inch declared at 575, appraised at 675, reappraised at 550 and 575, all per thousand kilos. Circular obtainable from Superintendent of Documents.) In Mr. Wood's remarks at end of page 1481 in reference to dumping and the Canadian law permitting their officers to open American books and see what they are selling for here and in the statement of the brief filed by Mr. Russell at the bottom of page 1490, and at the top of page 1491, it is stated that they have been unable to obtain from the Treasury Department and other Government agencies information of French costs when it was felt that foreign pipe was being dumped on this market and the inferences made that Pont-a-Mousson did not give information to American customs agents when asked for it.

In this connection we have to state that proceedings were instituted under the antidumping act before the Secretary of the Treasury, presumably upon complaint of American manufacturers, in May, 1925, and after investigation and report by the appraiser at New York to the Secretary of the Treasury, and we understand a report from the American customs agents in France, the Secretary of the Treasury decided that he would not issue a finding of dumping against Pont-a-Mousson under the antidumping act.

Early in 1926 another charge of dumping was made against Pont-a-Mousson, and after investigations made through the United States appraiser at New York, and other ports, and we believe a visit to the Pont-a-Mousson foundry in France in February 1926, or thereabouts, the Secretary of the Treasury, through the Director of Customs (predecessor of Commissioner of Customs) advised us as follows:

"An investigation has been made with reference to this particular shipment and it has been ascertained to the satisfaction of the department that the purchase price of the pipe in question was not less than the foreign market value on the date of purchase, and that there is no basis for any action under the antidumping act so far as this shipment is concerned. The collector of customs at Charleston has been instructed accordingly." (Letter Acting Director of Customs, dated Washington, June 9, 1926.)

It may be that the Treasury Department would not give American manufacturers the facts obtained in the customs investigations made in France and in America of the Pont-a-Mousson business, but Pont-a-Mousson has freely given information to American customs agents in France or in the United States even though we were reliably informed that these charges of dumping and undervaluation were made by American manufacturers and in all probability for the purpose of hindering our importations.

Mr. Kennedy's office has just telephoned to us that the Los Angeles importation at $16.57 foreign value per net ton mentioned in the schedule of Mr. Russell's brief printed at page 1491 is probably an error as Pont-a-Mousson has never declared a value as low as that.

Respectfully submitted.

BROOKS & BROOKS,

Counsel.for Herbert Kennedy Co., also Pont-a-Mousson Foundry.

COMMITTEE ON WAYS AND MEANS,

NEW YORK, January 24, 1919.

House of Representatives, Washington, D. C.

SIRS: Supplementing our brief mailed to you yesterday, we have to-day learned that in a report to the Secretary of the Treasury, dated November 16, 1926, by Assistant United States Attaché M. C. Camboa, approved by United States Customs Attaché in Charge at Paris S. E. Armstrong, it is stated that the customs attaché visited the head office at Nancy, France, of the Pont-a-Mousson Foundry on November 4 for the purpose of obtaining information requested by American customs officials and interviewed Commercial Director Thomas who was "very willing" to open all the books and records of his company to the customs agent, and the sales and other particulars obtained from these books not only were verified by the customs agent from the sales books, but, in addition, copies of the invoices were given to him by Director Thomas and he verified and checked those from their books of record.

This would seem to completely refute the inference of Mr. Wood's remarks at the end of page 1481 of the tariff hearings, that the Pont-a-Mousson Foundry would not give any information to American customs agents, especially as the agent who made this report stated that the officials were "very willing" to open their books and records to him.

Please insert this in the final print of the tariff hearings under paragraph 327, together with the briefs forwarded to you by us yesterday.

Respectfully,

34120-29-VOL 3, SCHED 3- -22

BROOKS & BROOKS, Attorneys for Herbert Kennedy Co.

SPROCKET CHAINS

[Par. 329]

STATEMENT OF CHARLES PIEZ, CHICAGO, ILL., REPRESENTING THE SPROCKET-CHAIN MANUFACTURERS

Mr. PIEZ. Mr. Chairman and gentlemen, I should like to say that we have filed a brief, and I merely want to emphasize some of the points made in the brief.

The particular section to which I refer is paragraph 329, relating to sprocket chains.

Sprocket chains are classified as sprocket and machine chains of iron and steel and parts thereof. We suggest, in order to avoid a misunderstanding, that that title be changed to sprocket chains made of iron or steel, or a combination of the two, used exclusively for the transportation of power, and parts of such chains.

There is no such chain known in the sprocket wheel art as machine chains, and I think that there must have been a mistake when that title was chosen.

I represent 11 sprocket-chain manufacturers who make sprocket chains and nothing else. These are the chains that engage with toothed wheels for the transmission of power.

I represent the following companies in this presentation, making exclusively sprocket chains: Morse Chain Co., Ithaca, N. Y.; Diamond Chain Co., Indianapolis, Ind.; Whitney Manufacturing Co., Hartford, Conn.; Baldwin Chain Co., Worcester, Mass.; Duckworth Chain Co., Springfield, Mass.; Ramsey Chain Co:, Albany, N. Y. The above companies make class A chains.

The Jeffrey Manufacturing Co., Columbus, Ohio; Chain Belt Co., Milwaukee, Wis.; Webster Manufacturing Co., Chicago, Ill.; Michigan Sprocket Chain Co., Detroit, Mich.

The above make class B chains.

The Link Belt Co., Chicago and Indianapolis, makes about half class A and half class B chains.

These groups represent an investment of about twenty-two or twenty-three million dollars and employ about 6,500 men in their chain-making and sprocket-wheel-making departments.

The present paragraph 329, covers all chains from the three-eights and one-half inch pitch-by the way, I have got several samples. That is a half-inch pitch chain. That is a chain of the same pitch [indicating] of the silent chain type. That classification is broad enough to include not only those chains but the chains of 12 and 18 inch pitch with an ultimate strength of about 300,000 pounds as a maximum. We submit that that classification is entirely too broad, because there is no common denominator of wages and materials that refers to all of these types and sizes of chains. We therefore suggest that sprocket chains for the purpose of the imposition of duties shall be divided into two classes: Class A, those of 2-inch pitch and under, either of the silent or the roller chain type-both types are represented by the samples submitted-made up of more than three parts per pitch; that is, per individual link; and Class B chains, made up of malleable iron, steel, or a combination of both, covering chains not included in class A.