PARAGRAPH 411-SURFACE-COATED PAPER. Cost of cases, ocean freight, etc., 15 cents per ream. Total, $1.86 per ream. Domestic flints sold under the Dingley law at $2 per ream, which left the importer not enough margin to pay his overhead expenses. (c) Proposed duty of 50 per cent ad valorem.-Cost f. o. b. foreign port, $1.06 per ream. Duty $0.53 per ream. Cost of cases, ocean freight, etc., 15 cents per ream. Total, $1.74 per ream. Domestic flints were sold under the Dingley law at $2 per ream and on this basis the importers, after paying 10 per cent for overhead expenses, could just meet the domestic manufacturers on a competitive basis. NO. 3. EMBOSSED SURFACE-COATED PAPERS. The domestic manufacturers slipped into the present tariff under the same duty as the metal-coated papers the words or if embossed or printed," thus throwing this class of goods, which were imported in limited quantities under the Dingley law, into the prohibitive class. The present high duty has absolutely prohibited the importation of embossed papers, for the reason that a surface-coated paper suitable for embossing must weigh 50 per cent heavier than the surface-coated paper which is not embossed. (a) Present tariff of 5 cents per pound and 20 per cent ad valorem.-Cost f. o. b. foreign port $2.75 per ream (basis 480 sheets, size 20 by 24 inches, weighing 31 pounds). Duty $2.10 per ream, equal to 76 per cent. Cost of cases, ocean freight, insurance, cartage, consular fees, customhouse brokerage, etc., 20 cents per ream. Total, $5.05 per ream. Domestic manufacturers sell embossed papers at from $3 to $5 per ream. Foreign importation is prohibited. (b) Dingley tariff of 2 cents per pound and 15 per cent ad valorem.-Cost f. o. b. foreign port $2.75 per ream. Duty $1.19 per ream, equal to 50 per cent. Cost of cases, ocean freight, etc., 20 cents per ream. Total, $4.14 per ream. Domestic manufacturers sold embossed papers at from $3 to $5 per ream. Competition existed only on the highest grades. (c) Proposed tariff of 30 per cent ad valorem.-Cost f. o. b. port $2.75 per ream. Duty $0.83 per ream. Cost of cases, ocean freight, etc., 20 cents per ream. Total, $3.78 per ream. On this basis the importers, after paying overhead expenses amounting to 10 per cent, could meet the domestic manufacturers on a competitive basis, and then only on the higher grades. On the lower grades of embossed papers the importers could not compete even if the duty was entirely removed. NO. 4. METAL-COATED PAPERS. The great bulk of the paper imported under this heading is imitation copper and imitation tin-foil, used for edging paper boxes. Under the Dingley tariff there was some competition between the domestic and foreign goods, but since 1909 the domestic manufacturers have reduced their prices, so that the importers can not now compete with them, even if the duty was reduced to the Dingley tariff rate. It can very easily be seen, therefore, that the importation of these goods is prohibited, and in consequence it has practically ceased. (a) Present duty of 5 cents per pound and 20 per cent ad valorem.-Cost of goods f. o. b. foreign port, $1.65 per ream (basis 480 sheets, size 20 by 24 inches, weighing 19 pounds); duty, $1.28 per ream, equal to 77 per cent; cost of cases, ocean freight, insurance, cartage, consular fees, customhouse brokerage, etc., 15 cents per ream; total, $3.08 per ream. Domestic manufacturers are selling these goods to-day at from $2.67 to $2.81 net per ream. Foreign goods are excluded. (b) Dingley tariff of 3 cents per pound and 20 per cent ad valorem.-Cost of goods f. o. b. foreign port, $1.65 per ream; duty, $0.90 per ream, equal to 54 per cent; cost of cases, ocean freight, etc., 15 cents per ream; total, $2.70 per ream. Domestic goods were sold at $2.67 to $2.81. The importer could not handle these goods and pay his overhead expenses. (c) Proposed tariff of 30 per cent ad valorem.-Cost of goods f. o. b. foreign port, $1.65 per ream; duty, $0.50 per ream; cost of cases, ocean freight, etc., 15 cents per ream; total, $2.30 per ream. Domestic goods are selling to-day at $2.67 to $2.81 net per ream. Adding 10 per cent (which is a conservative estimate-it is actually about 20 per cent) for overhead expenses, leaves the importers a chance to meet domestic manufacturers on a competitive basis. The surface-coated paper which is used most largely in what is called enameled book or wood-cut paper. These goods are not imported, for the reason that they can be made cheaper in this country than in foreign countries, and there would need be no duty at all on this class of goods. However, we are putting it on the ad valorem PARAGRAPH 411-SURFACE-COATED PAPER. basis of 50 per cent, which certainly need cause no worry to any American manufacturer. According to the decennial census taken in 1910 there was manufactured in this country during the year 1909 coated paper of all kinds aggregating 104,200 tons. During that same year there was imported, according to the statistics of the customhouse, 3,098 tons. The importation under the most favorable year of the Dingley law, namely, year ending June 30, 1907, was 4,132 tons, and at least 690 tons of this was a class of paper which is not made in this country at all, so that it will be seen that under the worst possible view that can be taken of the Dingley tariff out of 107,298 tons consumed here there were 104,200 tons manufactured in this country, and only 3,098 tons imported in the year 1909. Under a tariff law made wholly ad valorem, as we propose, we estimate a consumption of 110,000 tons, of which 100,000 tons would be manufactured in this country, and 10,000 tons, or one-tenth of the consumption, imported, and all domestic manufacturers would still do a good business, over $1,000,000 added to the income of the Government and another $1,000,000 saved to the great consuming public. The importations for the year ending June 30, 1909, were 6,195,302 pounds, and for the year ending June 30, 1912, were 4,549,317 pounds, a decrease of 1,645,985 pounds. The customhouse statistics are as follows: According to the figures of the eight domestic manufacturers (see tariff hearings, 60th Cong., vol. 6, p. 6099), the item of labor in America is 21.8 per cent of the total cost, and the item of labor in Europe is 9 per cent of the cost. A cablegram January 13, 1913, sent us from the largest mill in Europe, states that their labor cost on a ream of flint paper is 15 per cent, and on embossed papers and metal-coated papers it is 10 per cent. However, taking the domestic manufacturer's own figures, the result is as follows on one ream of paper: To get the above table we have taken the American flint papers at $2.25 per ream, 21.8 per cent of which is 49 cents, and subtracted the European labor cost, namely, 9 per cent of their price, which equals 10 cents per ream, and the result is 39 cents excess per ream paid American labor on flint papers. On embossed papers we take an average cost of $4 per ream, 21.8 per cent of which equals 87 cents per ream, the American labor cost. Subtracting the European labor cost, namely, 9 per cent on $2.75, equaling 25 cents per ream, and we have 62 cents per ream excess paid American labor. On metal-coated paper, take the American cost at $2.50 per ream, 21.8 per cent equals 55 cents labor cost. Subtracting ($1.65 at 9 per cent) 15 cents European labor cost, we have 40 cents per ream excess labor cost per ream. PARAGRAPH 411-SURFACE-COATED PAPER. SUMMARY. We ask that all duties on surface-coated papers be placed on an ad valorem basis. We ask that surface-coated papers be separately classified as herein before enumerated, so that hereafter the statistics regarding importations may be of value in adjusting rates. We ask that we, as importers, may have a fair opportunity to compete with domestic manufacturers after allowing for the cheaper labor cost of Europe. We ask, if the duty on the raw materials used by the domestic manufacturers is reduced by this proposed new tariff act, that a corresponding reduction be made from the ad valorem rates we have suggested, so that the basis of competition may be maintained. We ask that the duty on surface-coated paper for covering paper boxes, which is raw material for 2,000 paper-box manufacturers in this country, be taken out of the prohibitive class and placed on a competitive basis, thus saving over $2,000,000 annually to the American consumer, namely, $1,000,000 direct in the lower price of his goods, at the same time adding $1,000,000 to the income of the Government. We ask for an immediate downward revision so that the American public may have the choice of purchasing either foreign or domestic papers without being penalized by an excessively high price in the event that it may wish to purchase any foreign paper. Respectfully submitted. CHARLES W. WILLIAMS & Co., By CHARLES W. WILLIAMS. SUPPLEMENTAL BRIEF OF CHARLES W. WILLIAMS & CO. Hon. OSCAR W. UNDERWOOD, Chairman Committee on Ways and Means, House of Representatives, Washington, D. C. NEW YORK, January 27, 1913. DEAR SIR: We wish to supplement our brief of January 17, 1913, by stating that we fail, after looking through the brief submitted by the 10 domestic manufacturers of glazed papers to find any facts controverting our figures. In looking over their figures for selling expense, namely, 54 cents per ream for domestic manufacturers to 34 cents for the foreign manufacturer, they do not include the large selling expense incurred by foreign manufacturers when selling in this country. In fact, the figures should read the other way round, as it takes 8 to 10 weeks after an order is taken for foreign goods before they can be delivered; also the importer is obliged to carry enormous stocks, whereas the domestic manufacturer can fill an order in one to two weeks. Also, the figures as regards wages are incorrect, as they put down excessive wages for themselves and put down the wages of the foreign labor at 34, 43, and 48 cents, etc., whereas the facts are that the domestic mills employ considerable female help, whereas the foreign mills do not employ female help at any price, and the male help receives at the lowest 90 cents per day. Lest, however, the domestic manufacturers in some subsequent brief may, through more exaggerated statements, try to pursuade you to keep up this present prohibitive duty, we trust you will call upon us to substantiate our figures, which we hold ourselves in readiness to do, and will show bills upon bills to prove every word and figure already given you. We do not agree with the nine importers who signed Mr. Herman Staber's brief that papers with coated surface or surfaces, n. s. p. f., should go as low as 35 per cent; we want to see the domestic manufacturers compete. If this duty is 50 per cent it will be about right, but if higher than 50 per cent importers can not compete. Neither do we agree with the Charles Beck Co. that paper coated with metal or its solutions should go as low as 20 per cent, but it should not be more than 30 per cent. We want to see this Democratic administration a success and do not want to see too radical a change. We have tried in our figures to be absolutely fair and impartial to both foreign and domestic manufacturers. If too low a duty is assessed, the domestic manufacturers can not compete, and if too high a figure is named the foreign manufacturer can not compete. Give us a competitive duty and thus benefit the con sumer. PARAGRAPH 411-SURFACE-COATED PAPER. In our brief we overlooked a paper listed under the surface-coated papers n. s. p. f., at 5 cents per pound, which in value is equal to about half of the importations in this class, namely, patented simplex and duplex paper for printing decalcomanias. Of this paper there was imported during the year ending June 30, 1912, about $150,000 worth. This is the paper which is used largely by the Meyercord Co., and which is mentioned in the brief of the National Association of Employing Lithographers, they asking to have it put on the free list. It figures to-day at cents per poundabout 44 per cent ad valorem. (See their brief on decalcomania transfer prints.) For the purpose of accurate statistics we petition that this paper be taken out of the class of "paper with coated surface or surfaces n. s. p. f." and either put on the free list, or, if a duty is levied, that it be an ad valorem duty and specially enumerated by itself. We will be glad to be of any service to the committee in order to make a fair and just tariff bill that will not shut down or seriously injure domestic manufacturers, but one that will broaden and widen them and one that will put a stop to "protection run mad"; that will give us competitive instead of prohibitive duties; that will reduce the cost of living to everybody and will make this country more than ever democratic equal rights to all and special privileges to none. Yours, very truly, CHARLES W. WILLIAMS & Co. By CHARLES W. WILLIAMS. TESTIMONY OF GEORGE H. TOMPKINS, REPRESENTING NATIONAL FEDERATION OF PAPER BOX MANUFACTURERS' ASSOCIATIONS. The witness is duly sworn by the chairman. Mr. TOMPKINS. I wish to file a corrected brief in the place of the one I filed with the clerk previous to this time. Mr. DIXON. Hand it to the clerk. Mr. TOMPKINS. I represent, as secretary, the National Federation of Paper Box Manufacturers, which comprises three territorial organizations of manufacturers, covering the Western, Central, and New England States. I shall endeavor to make my argument rather short. I do not believe it requires very much argument on our proposition. Another reason is, Mr. Charles W. Williams, in his statement made and brief filed this morning, has practically covered our case. The present tariff law provides as follows: SEC. 411. Papers with coated surface or surfaces, not specially provided for in this section, 5 cents per pound; if wholly or partly covered with metal or its solutions (except as hereinafter provided) or with gelatine or flock, or if embossed or printed, 5 cents per pound and 20 per centum ad valorem; * * * We ask that the tariff act be amended by making a rate on surface coated paper not specially provided for of 50 per centum ad valorem; if wholly or partly covered with metal or its solutions or with gelatin or flock, or if embossed or printed 30 per centum ad valorem. By amending section 411 to read as follows: Papers with coated surface or surfaces not specially provided for in this section 50 per centum ad valorem; if wholly or partly covered with metal or its solutions of with gelatin or flock, or if embossed or printed, 30 per centum ad valorem; * * * Our organization represents the paper box manufacturers of the United States who use these papers as raw materials. We are not opposed to a duty that will equalize the cost of production between the foreign and domestic paper manufacturers, but PARAGRAPH 411-SURFACE-COATED PAPER. do not feel that we should be compelled to pay prices based on a tariff in excess of the difference in cost of manufacture. At the time of the consideration of the Payne Act by Congress we protested against any increase in the duty, and the Finance Committee of the Senate restored the Dingley rates in the bill. The bill as finally passed, however, increased the rates over those contained. in the Dingley law by 100 per cent. The fact that the Senate committee complied with our request at that time we feel is almost conclusive as to the reasonableness of our position. At that time we predicted that if the duty was increased the prices on domestic friction papers which are not imported would be raised by the American manufacturers, and that prediction has come true, as not only were the prices on imported papers raised in consequence of the duty, but we are advised by our members that the American manufacturers have increased prices on domestic friction papers, in some cases as much as 25 cents per ream. As to the cost of manufacture of these papers, the domestic manufacturers in their statement (see tariff hearing, 60th Cong., vol. 6, p. 6099) stated that the item of labor in Europe is 9 per cent of the cost. Taking the figures the following table shows the result figured on 1 ream of paper: To get the above table, we have taken the American flint papers at $2.25 per ream, 21.8 per cent of which is 49 cents, and subtracted the European labor cost-namely, 9 per cent of their price, which equals 10 cents per ream, and the result is 39 cents excess per ream paid American labor on flint papers. On embossed papers we take an average cost of $4 per ream, 21.8 per cent of which equals 87 cents per ream, the American labor cost. Subtracting the European labor cost-namely, 9 per cent on $2.75-equaling 25 cents per ream excess paid American labor. On metal-coated paper, take the American cost at $2.50 per ream, 21.8 per cent equals 55 cents labor cost. Subtracting ($1.65 at 9 per cent) 15 cents European labor cost, we have 40 cents per ream excess labor cost per ream. We are informed by the importers that the labor cost of the European mill on a ream of flint papers is 15 per cent instead of 9 per cent, and on embossed papers 10 per cent instead of 9 per cent, which would make the comparison even more favorable to our contention. As to the revenue, we understand from the imports, it decreased over a million and a half pounds in 1912 from what they were in 1909. We believe that if a reasonable duty is placed on these papers the imports will be materially increased and the revenue of the Govern |