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PARAGRAPH 451-LEATHER.

In common with all ordinary American citizens who are consumers we share with you our desire that those in the first group shall no longer be able to create monopolies in this country, protected in the same by tariffs excluding the products of other countries. It is to them the good of the commonwealth demands your attention.

Regarding those composing the second group, producing industries without monopolies, without exclusive control of the raw material of their trade, and having within them all the elements of keen competition which serves at all times to give the greatest service with the minimum living profit, we would ask your most careful consideration in connection with any legislation involving a disturbance of the present low tariffs on their business which would open the way for destructive competition from the low-cost labor of Europe. I am

Í more especially treating of this manufacture of calf leather, in which I am directly interested.

The time is approaching all over the world when the labor cost will be nearer equivalent one country to another. The universal introduction of machinery will call for a more intelligent laborer and a higher-paid laborer abroad as well as at home, for ignorant hands can not compete with intelligently manned machinery. But that time is not yet here, and until it arrives our home labor, with all the ramifications of its needs for the worker, demands so much protection as shall defend them in their present enjoyment of comforts.

It is not necessary in preparing this short statement for your consideration to frame an argument with an endeavor to conceal any method of transacting our business, past or present, or design to deal unfairly with any individual, or to sell cheaply abroad and at the same time maintain high prices at home, or combine in any method, either secret or public, to raise or lower or monopolize any article, raw or manufactured, in our trade. The prosperity of the shoe and leather business rests on the independent and solid foundation laid years ago by the workmen of our craft with honest thrift, unaided by grant, privilege, subvention, or tariff by Government, and it is to-day one of the solitary few monuments of the individual working and independent effort left standing, a beacon rising above the jumble and débris of combinations and trusts.

I am interested in a manufacturing industry that is located in the Middle West.

We require a tariff no higher than is necessary to maintain our industry on a normal basis of moderate profits.

This is always determined by selling prices resulting from a condition of free competition.

The leather industry never has had to contend with an injurious trust or combination.

Leather manufacturers compete freely with one another and have equal opportunity in the purchase of their raw material.

The prices at which they sell under such conditions of free competition should be the basis of any tariff measure enacted for their protection.

But there are conditions entering into the manufacture of leather so entirely different from other industries that it should have special consideration.

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PARAGRAPH 451-LEATHER.

I refer particularly to the sources from which tanners draw their raw material, considering first the domestic supply of raw hides and skins.

In the year 1900 there were in the United States for every 100 inhabitants 83 cattle.

In the year 1912 there were for every 100 inhabitants 61 cattle.

In other words, the supply was one-third greater 12 years ago than it is to-day.

The supply of cattle being one-third greater naturally the annual take-off of hides was one-third greater 12 years ago than it it to-day.

Meanwhile, the demand for leather has greatly increased and tanners have been obliged to go abroad to meet not only a deficiency but also an increased demand.

In the calfskin business at the present time farmers in this country are raising their cattle to secure economic conditions based upon proper methods of farming, and the slaughter of calves has greatly decreased thereby.

Twenty years ago nearly the entire supply of raw calfskins required by tanners in this country were produced at home.

To-day from 70 to 80 per cent of the raw calfskins required by American tanners must be obtained outside of this country.

The largest calfskin tanneries in the world are located in Germany, two especially, those of Heyl and Freudenberg, greatly exceed in their output the largest of our American calfskin tanneries. Their growth, fostered by the paternal system of the German Government, has been the phenomenon of the last 20 years. Their greatest advantages have been, first, their proximity to the largest source of supply of raw skins, namely, the semicivilized steppes of Russia, and secondly, the cheap labor. With these two advantages, they have invaded every market of the world, except America. They drove American

. tanners out of the free-trade market of England, are crowding us out of the few places where we have yet more or less desirable business. Our present moderate duty alone prevents their shipping great quantities of finished leather into the United States. leather in America was largely tanned with bark, we had an advantage in the cheapness of our tanning material, but at the present time the volume of upper leather is tanned with bichromate of potash, which is equally accessible to Europe as well as American tanners. This makes a condition so menacing that the American calfskin tanner feels himself at a great disadvantage. But this is only a part, and the least part, of the danger that threatens the American calfskin tanner.

Consider that the home production of raw calfskins is so inadequate that the American tanner must buy 80 per cent of his raw skins in foreign countries.

And further consider that the greater part of this 80 per cent of the supply of raw skins must pass the doors of the great German tanners before being fairly en route for this country.

Consider also the advantage in purchasing enjoyed by the European tanners and the disadvantage which great distance, brokerage, freights, and all the minor tribute which Europe levies on goods designed for competitors' countries.

When upper

PARAGRAPH 451-LEATHER. Consider carefully what this makes the raw material cost American tanners landed at their tanneries, and then add to this burden the higher wage needed to satisfy the demand of the American workmen, and it will be seen that there is no opportunity for swollen profits for the American tanner.

We are now engaged in a constant struggle with the European tanner to secure in territory which he considers his own sufficient raw skins to satisfy the requirements of our home trade for finished leather. Our only protection in this somewhat unequal struggle is the low tariff which keeps out the European finished product. Internal competition among ourselves keeps the profit at a minimum.

Against the wage scale we make no protest. It is the measure of the cost of living in terms of exchange of services, and the whole fabric must stand together. But it is this great mass of human beings deriving their support from our industry that must be crushed by the pressure of foreign competition, if the small protection our Government now affords us is swept away: German paternalism may maintain the body of German workers in a condition of dull mendicancy, but the American workingman flings aside the proffer of an old-age pittance and asks for space and opportunity to turn his brain and muscle into a just share for himself and his family.

The leather manufacturers of this country are dependent upon imports of raw material from foreign countries to an extent which is now causing most serious consideration of the trade. As many hides are imported from foreign countries as are taken off in the United States by all the Chicago packers combined, and of calfskins 80 per cent of the amount tanned by American tanners are bought in foreign countries and brought to the American tanners to manufacture. This emphatically proves the need of free raw material for the trade uncontrolled by combination of packers and equally accessible to the smallest as well as the largest tanner. This is the condition of the raw material without the addition of American labor to convert it into leather. Consider the present moderate duty swept away and the great market of this country open to the flood of foreignmade leather. The demands of foreign tanners for rawhides would greatly increase in order to enable them to supply this market in addition to the business which they already have, and they will become more determined in their efforts to secure still larger quantities of hides and skins in the world's markets, making it more difficult than now for American tanners to secure their supplies in the world's markets. The fight to secure our share of raw material has forced the market for rawhides and skins beyond all normal records of the past. We may see prices of rawhides and skins and the resulting leather and shoes forced to a still higher and more difficult position. Our supply of raw skins in this country to-day is inadequate and is yearly becoming more and more deficient, and we, therefore, protest against increasing the difficulty of securing such supplies as we require.

The American leather trade is to-day struggling against conditions more difficult and serious than ever before encountered in the history of this country. An increasing home demand for leather in the form of shoes and other products and a gradual but cer

PARAGRAPH 451-LEATHER.

tain diminishing in the supply of raw hides and skins compels us to look to foreign countries for our supplies of raw skins. In these foreign hide markets we meet with determined efforts of the foreigners to retain for their own use their production of hides and skins to cover their own requirements. Open this country to the free imports of foreign-made leather and conceive, if you can, the increased requirements of the foreign tanner for raw hides and consider the position forced upon the American tanner, who would buy hides in the world's markets. Inevitably higher prices must result from such a disturbance of the world's markets, which even now are far removed from that condition of stable equilibrium which is only consistent with the safe and profitable prosecution of any form of protective industry.

Compelled as we are to buy so large a share of our raw material abroad, contending against all the advantages possessed by European tanners because of their local buying organizations and their nearness to the source of supply, it can be seen that we have an excessive cost to pay in order to take this raw material from their territory and bring it to our American tanneries.

One hundred raw calfskins which we buy in Europe weigh 800 pounds, upon which we have to pay the freight and expenses to land them in our American tanneries.

The German tanner taking these raw skins from his immediate neighborhood can tan them and finish them, by which process their weight is reduced, so that 100 finished calfskins weigh only a little over 100 pounds, on which the European tanner would pay the freight, or, in other words, he would ship the finished product on a freight basis of one-eighth of the weight of the raw material.

The opportunity of obtaining our supply of raw material was given us when the duty was taken off hides.

This saved the trade from the unfair competition of the large packers, many of whom are now tanning their own take-off.

We wish this free import of the raw material to continue, but we need a moderate tariff against foreign leathers not only to offset the expense of freight on raw hides and skins to this market but also to make up the differential in the labor cost between foreign and home produced leather.

For the purpose of revenue and at the same time placing the American tanners on a competitive basis with the European tanners, I should propose a duty of 10 per cent instead of 15 per cent as it now stands.

We ask the retention of the small duty on leather for the benefit of the great body of proprietors of moderate capital who now, having their raw material free and equally accessible to all, have freedom of opportunity unsurpassed in any other great industry, an industry where small beginnings still having a chance to prosper and grow, have resulted in individual industry and individual ability, an industry that never has had and does not ask for any favors nor monopoly, but only such slight protection as shall enable them to give their employees a wage such as will maintain contentment and prosperity for the workmen as well as for the employer. No governmental favoritism in the shape of an extravagant tariff is asked for. This

PARAGRAPH 451-LEATHER.

is neither a giant monopoly demanding favors or an infant industry begging for help. It is the army of producers of a human necessity presenting its just claim for such protection as will enable it to continue to pay a fair wage to its humblest wage earner.

It has been asked why free raw material did not bring about lower priced shoes, or, in other words, why shoes have cost more since the repeal of the hide tariff. Well, let us compare our local market to an estuary, cut from the ocean of the world's markets. The world-wide markets rise and fall like the tides of the ocean, whether the local market is cut off by a tariff wall or not. Remove the wall and the tides of the ocean roll on and rise and fall from influences world-wide. These influences have been at work since the duty on hides was removed, and will continue to ebb and flow, reducing to a level home and foreign prices.

We are not averse to subscribing to a tariff for revenue only. Looking back to the period from 1812 to 1862 we note that internal revenue was an unconsidered item, and after allowing for all the revenue very moderate methods may derive from a great accumulation of wealth, from excessive incomes, and from all luxuries, there will still remain a deficit of several hundred million dollars to be provided for by wise and equitable tariff, a tariff that should be wisely and not abruptly reduced as other sources of governmental income may develop. We submit that taking the present average of duty on dutiable articles of 40 per cent and the present duty on shoes and leather of 15 per cent, the shoe trade have been reduced in protection offered them to the lowest terms of a nominal duty. While there are other products to which attention had better be bestowed, we are committed to the forms of the tariff, but they should be equitable; we are committed to withdraw the protection that swells the profits of a few and collects tribute from the many; but the leather trade is not of this sort, and we ask your careful consideration of our request for the maintenance of a moderate duty for the present at least until it can be demonstrated that this great industry can without injury sustain a further reduction.

No organized lobby has ever pushed the claims of this great industry for assistance. Working in separate localities and with no solidarity of organization, they appear before you only when it seems imperative for their existence to lay before you facts which should be a basis for your decision.

To withdraw the slight differential which now checks the inflow of foreign leather will precipitate a labor contest within the trade. In no other item can costs of manufacturing be reduced. This means a destructive conflict and in the end a denial to the laborer of a fair share of the product, which we wish definitely to avoid. There is every reason to believe that the year 1913 will see the United States established as the greatest of the world powers, greatest in commerce as well as in other respects, and as the shoe and leather trade is one of the great industries of the country, having now the advantage of free raw material and equal opportunity for all to secure it, and as this trade has within it no monopolies or combinations taking swollen profits from the consumer, but is composed of individual concerns working on legitimate margins, we ask your careful consideration of

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