PARAGRAPH 427-BUTTONS.

BRIEF SUBMITTED BY SENECA BUTTON CO., POUGHKEEPSIE, N. Y.

To the WAYS AND MEANS COMMITTEE,

House of Representatives, Washington, D. C.:

The vegetable ivory button industry has a pathetic history. It secured a slight foothold in this country in the seventies, but was largely wiped out of existence during the period of 1884 to 1889. Under the McKinley tariff the industry again got a slight foothold, only to be ruined by the Wilson tariff. In 1897 we once more established, and we now face with great fear the mere possibility of any change in the present duty. All the above has been so because labor is such a tremendous percentage of our cost. An industry where labor and salaries is 75 per cent as against raw material 25 per cent is absolutely in need of consideration as against foreign labor. Twice, by not adequately recognizing this fact, changes in the tariff have ruined the industry.

Since the early history of this business in the sixties, we do not know of one single man who has made a fortune in the manufacture of ivory buttons. Indeed we can put this much stronger; we know of only one man engaged in the business who eventually got out of it with-let us say, a dollar.

All this simply tells you that the business has been a competitive one. The consumer has benefited and the American workman has been paid American wages.

The American industry has always, at all periods, been controlled by foreign competition as it is to-day. We submit you below figures taken from your Government records.

FOREIGN COMPETITION IN VEGETABLE IVORY BUTTONS UNDER PRESENT TARIFF. Importations of vegetable ivory buttons by years.

Vegetable ivory buttons are made from vegetable ivory nuts. The nuts are entered free from duty. The production of buttons is of course related to the importations of nuts. Importation of ivory nuts.—1900, 8,036 tons; 1905, 9,844 tons; 1912, 11,538 tons. The census of 1900 and 1905 gave the number of gross of ivory buttons produced and also the value thereof for each period, but the census of 1910 considered the subject of buttons as a whole and gave no data as to the vegetable ivory button industry. Value of ivory buttons produced in the United States.

Ivory buttons made in this country are in large measure sold to consumers direct. Hence importations should be figured in part at price to consumer. The importations for 1912 were in value $143,418 as above. Add to this, say, 40 per cent to put same on a parity with American production as sold and we have the value of imports as $200,785, or about 13 per cent of the American production as estimated above. The above, however, tells you only a very small part of the story.

The importations are not greater because we have been constantly threatened by the increasing foreign importations, as shown by your records, and have made prices to meet the foreigners even at loss to ourselves.

PARAGRAPH 427-BUTTONS.

Let us state this more strongly. The importations of vegetable ivory buttons would probably have been two or three times greater than they are, except for the fact that we have sold such large quantities at figures way below cost. The returns on the industry indicate this to you. Our books and records will absolutely prove the fact to you.

Furthermore, wherever you find any industry under such extreme competitive conditions as ours you know that many goods are sold below cost for volume, and, obviously, goods sold at such low figures take the place of goods that would come in from Europe made by cheap labor.

It is obvious to you from the foregoing that we do not and can not export any ivory buttons.

We contend that it would be eminently unfair to reduce the tariff rate on our product when we are continually striving to better the conditions under which our employees work and to shorten the hours of labor. From October 1, 1912, the working hours of women, girls, and of boys under 18 years of age were reduced in the State of New York to 54 hours per week. These hours granted now by us to both men and women serve to increase our costs.

The ivory-button factories in this country work 54 hours per week. Our foreign competitors work 60 hours per week.

As further evidence of the very sharp competition in the ivory-button industry, there have been a number of failures in the past few years. Gentlemen, we earnestly beg of you to let us alone. Respectfully submitted.

SENECA BUTTON CO.,
J. C. DENNEY, Secretary.

BRIEF SUBMITTED BY M. TURKELTAUB & SON, NEW YORK CITY.

We come before you as importers, jobbers, and manufacturers of buttons. We import and job between two and three times as many buttons as we manufacture.

We refer to Schedule N, paragraph 427, dealing with vegetable-ivory buttons. In order that you may determine the proper duty on vegetable ivory buttons, we present the following facts for your consideration:

Vegetable ivory buttons are used on the better grades of clothing; on the cheaper grades of clothing there are used composition buttons, metal buttons, and hornoid buttons.

No matter how low the price of buttons may be, the consumption will not increase, owing to the fact that buttons are manufacturers' supplies and manufacturers of clothing will not consume any more than they require to sew on the clothing that they manufacture.

The present profit to the manufacturer, owing to the very keen competition that exists, is very little about 2 cents per gross on the average. We know this from the manufacturing end of our business, and under these conditions manufacturers can hardly make a living profit.

We suggest that you allow the present specific and ad valorem duty to remain, as it is hard even for an expert to determine the exact value of a vegetable-ivory button, which is made in different qualities-various goods looking alike, but costing much more to produce. For instance, a 90-cent button can very easily be brought in as a 50-cent button, and an appraiser can not distinguish between them.

If the present duty on vegetable ivory buttons shall be reduced, it is our humble opinion that under conditions now prevailing the industry in this country will be ruined. The consumer will not profit one penny, as the individual cost to a person is comparatively little, but a few cents on a suit of clothes. The foreign trusts in the ivory-button business of Europe will be enriched.

In 1884 to 1889 and in 1893 to 1897, when the tariff on vegetable ivory buttons was reduced, it practically put every manufacturer of this class of goods out of business. Under the present tariff European manufacturers can successfully compete with American manufacturers even to a larger extent than they do. Were the tariff changed, however, even slightly, it would allow them to sell certain kinds that they can not now sell. This additional incentive will lead them to make efforts that they are not now making.

Manufacturing is but a part of our business, and were the tariff reduced it would not affect us as much as it would were we manufacturers exclusively. If a change in the tariff is made, we could dismantle our plant and buy our goods exclusively in different centers of Europe, especially Italy, where the proportion of labor is so much less than it is in the United States; and we would, therefore, be able to remain in the business and sell our merchandise at a profit by successfully underselling American manufacturers of vegetable-ivory buttons.

PARAGRAPH 427-BUTTONS.

We also wish to state that one of our prime motives for submitting this brief for your consideration is the fact that we have been petitioned by many of our employees in the manufacturing end of our business, who have gone through the previous tariff change on vegetable-ivory buttons, and know the hardships they would have to endure should Congress decide to reduce the tariff, and they therefore join with me in asking you to let the present duty remain as it is and allow the industry in this country to live. Respectfully submitted.

M. TURKELTAUB & SON, By NATHAN TURKELTAUB.

STATEMENT BY CONSOLIDATED BUTTON CO.

CONSOLIDATED BUTTON CO.,
January 30, 1913.

The WAYS AND MEANS COMMITTEE OF THE HOUSE OF REPRESENTATIVES. Mr. CHAIRMAN AND GENTLEMEN OF THE COMMITTEE: We contend that the present rate of duty on vegetable ivory buttons should not be changed, and we have no fear, being in possession of the facts that govern this industry, that your committee will recommend any alteration in the rates now existing. The reason for our confidence in this opinion is that your committee are endeavoring to revise the tariff on a basis of equity and justice to all interested therein.

The present contemplated revision of the tariff is to be a Democratic revision, therefore, the Democratic Party, through its leaders, having at all times stated that no industry need fear that it will not be adequately protected by means of the tariff when it can be shown that said industry is in no way monopolistic or is conducting its business by means of combinations or trade restraint and is not making unreasonable profits through the fact that they are protected by the tariff. If we may assume that the Democratic Party have made the above assertions, we respectfully submit that they must have had in mind the conditions which now prevail in the manufacturing of vegetable ivory buttons.

We beg to submit the following facts:

1. In our industry there has not been and there is not now existing any combination. Keen competition has at all times and does now prevail, and the business can in no wise be considered a monopoly from any viewpoint.

2. The returns on actual capital invested are and have been much below 5 per cent per annum.

3. Sixty-five per cent of the cost of manufacturing in this country is paid to labor, as against 25 and 30 per cent paid to labor in foreign countries.

4. Skilled labor in this country makes from $16 to $20 per week, whereas skilled labor in foreign countries makes from $4 to $8 per week.

Unskilled labor in this country receives $5 to $12 per week, and unskilled labor in foreign countries $2 to $4 per week.

5. When viewing the conditions stated above, it will be clearly and easily seen that should the specific duty be reduced to any extent whatsoever the manufacturers of vegetable ivory buttons in this country would have to discontinue business or reduce their wage scale to a basis of the rates existing in foreign countries. Therefore, it is clearly and easily understood that were the manufacturers to so reduce the wage scale to anything nearly as low as the foreign wage scale, their employees would be compelled to seek employment in other branches of trade, and as there is an overabundance of labor now offering in almost every other industry, the effect of any such reduction would be that the present laborers employed in the manufacture of vegetable ivory buttons (and especially those who have spent years to become skilled therein) would be thrown out of employment, with a sparse chance of obtaining employment

elsewhere.

6. One of our principal arguments why the present specific duty should be maintained is that were the Government to collect duties on an ad valorem basis it would be the means of false valuations creeping into foreign invoices, as it is very difficult for even an expert to tell the value of a gross of vegetable ivory buttons, when comparing one grade which is supposed to be a cheap variety against another grade which is supposed to be an expensive variety; consequently the specific duty obviates definitely the chance of undervaluation by foreign competitors.

DEVELOPMENT OF RECENT FOREIGN COMPETITION.

A new menace has arisen in our industry within the past few years, that is, that we have to compete with Italian manufacturers, and when considering that our import

PARAGRAPH 427-BUTTONS.

factor is labor, the slightest change in the present rate of duty would cause an influx of importations into this country from Italy, where the labor rates prevailing are the cheapest in Europe. The business of the world has always followed cheap labor, and it is only within the last three to five years that Italy has become the center of the button industry, the factories there being located in small towns where labor is the very cheapest. They are, therefore, able to ship goods all over the world.

Germany, once a large factor in the button business, is no longer so to-day, and it is a known fact that one German manufacturer, probably the most prominent, in order to keep in the business, recently placed a single order in Italy for 175,000 gross of ivory buttons, despite the fact that Germany is supposedly protected by a tariff. The wage scale in Italian ivory button factories is from 20 to 25 per cent of those existing in the United States. Good authority for this statement can easily be obtained.

JAPAN.

This is the latest nation to engage in the manufacturing of buttons, and quoting from the report of the Chamber of Commerce at Yokohama, Japan, we find that there are located in one city of Japan (Osaka) 75 button factories. These Japanese factories have representatives and are selling goods to-day in Europe, and we are credibly informed that the Italian manufacturer is now complaining of this Japanese competition. We have not contemplated herein to file any statistical conditions in reference to the industry of vegetable ivory buttons, as other manufacturers in this line, we understand, have fully covered this ground; therefore, were we also to do likewise, it would make the data in the case unnecessarily voluminous.

In closing we have the honor to contend that our position in this matter is founded on absolute facts, not on any questionable theory.

Respectfully,

CONSOLIDATED BUTTON CO., By C. O. THOMPSON, President.

BRIEF SUBMITTED BY ADOLPH WEICHT, OF ADOLPH WEICHT & SONS, PHILADELPHIA, PA. The WAYS AND MEANS COMMITTEE,

House of Representatives:

I respectfully petition, on behalf of our company, that the present tariff Schedule N, paragraph 427, on vegetable-ivory buttons, be allowed to remain unchanged.

LABOR.

I have been engaged in the manufacture in this country since 1884, with the exception of a period of time during which a low tariff prevented my making this class of goods.

I am well acquainted with the vegetable-ivory business of Austria. I have within the past two years visited Austria and have investigated conditions personally. I respectfully submit the following table, showing the difference between wages here as compared with those in Austria:

These figures speak for themselves.

I can further state that wages in Italy are below those paid in Austria.

Respectfully,

ADOLPH WEICHT, Sr.

PARAGRAPH 427-BUTTONS.

STATEMENT BY L. FRAISSINET, OF HOBOKEN, N. J., REGARDING VEGETABLE-IVORY

BUTTONS.

The WAYS AND MEANS COMMITTEE,
House of Representatives, Washington, D. C.

HOBOKEN, N. J., January 28, 1913.

GENTLEMEN: The retention of the present tariff on ivory buttons is of very great importance to that industry. and any departure from the established schedule is surely going to work great harm and probably cause the closing of many factories. My argument is based not only on the well-known lower cost of production abroad, owing to lower wages and lower other standards, which directly or indirectly affect manufacturers, but very strongly on the fact that the button industry is to-day as never before subjected to the keenest kind of competition, so that prices obtained by manufacturers are lower now than they were at any time in recent years. On the other hand, the price of raw material (ivory nuts imported from Central and South America) is higher and labor costs, if not greater, are certainly no less.

Ivory buttons are sold at extremely low prices. There being an abundance made, the manufacturer in many cases is practically compelled to accept not what he should receive as his due for his investment and his hard work but merely what he is offered. The situation in fact can be summed up in four words, namely, "Too many goods made," hence ridiculously low prices.

This industry has developed very considerably under the present tariff, but it has come to that point where it is a question often, whether the selling price is not too close to or even under the cost price.

It is certain that the cost of buttons on a suit of clothes is a mere trifle, and I submit that a lower rate of duty could only benefit the importers and the clothing manufacturers. Admittedly, the consumer no matter what the buttons on his clothes cost will pay the same price for the suit.

Lastly, the button industry is one in which exists an entire absence of agreement or combinations and in which competition of an excessive nature has held sway to this day without interruption.

Therefore, in justice to the situation that industry is entitled and should be allowed to continue undisturbed. (Signed) L. FRAISSINET, President the Button Machinery Co.

Respectfully,

BRIEF OF FEDERAL BUTTON Co.-VEGETABLE-IVORY BUTTONS.

We ask you to continue the present duty on vegetable-ivory buttons, namely, threefourths of 1 cent per line per gross and 15 per cent ad valorem.

The difference in price between the various classes of ivory buttons is per se not great. Prices do vary, according to the circumstances and conditions under which the buttons are made and sold. However, there is a uniform and regular variation in all classes and under all conditions as between ivory buttons of different sizes.

PRESENT SPECIFIC FUNDAMENTALLY AD VALOREM IN ITS NATURE.

The specific portion of the present duty is three-fourths of 1 cent per line per gross. Permit us to explain: A line is one-fortieth of an inch-a sleeve button is 20 lines in size that is to say, twenty-fortieths, or one-half, an inch in diameter. The specific here (three-fourths of 1 cent per line) would be obviously 15 cents per gross. A coat button is 30 lines in size (three-fourths of an inch in diameter). The specific here would thus be 22.5 cents per gross.

Let us make this clear. The specific portion of the present duty recognizes the difference in value between the various buttons we make as to size, and in about the right proportion. It is thus fundamentally and to this extent, in its nature an ad valorem duty. In addition we then have the 15 per cent straight ad valorem to take care of other variations in price.

It is essential for us in competition with the foreigner to know what duty he is going to pay. We must have a duty in part specific.

Under the present precarious condition of the industry-earning 2.73 per cent per annum on actual capital-any change in the present duty either as to amount or as to its nature will prove ruinous.

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