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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

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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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the requests of this great industry to refrain from disturbing the present adjustment of the trade, lest the balance now so closely adjusted be disturbed and an issue be forced upon the trade involving a contest with labor and a resulting check to the present distribution of the income of the business in which the wages of labor have their full and generous portion.

The leather trade does not ask for a tariff against importations that will enable them to pile up great profits in a single year. The industry with but few exceptions is made up of individual concerns competing keenly with each other and at every point maintaining the place only by the strictest economy in manufacture and strenuous efforts to keep the good will and trade of their customers. The large concerns have become large because of the excellence of their product and their fitness to stand the hardest competition. It is clear that there are no swollen profits to be attacked and that there is no article of human needs made and sold at less margin of profit.

I have, therefore, endeavored to show, first, that the raw material of the leather trade, namely, raw hides and skins, now free of duty, is freely open to purchase of all in the trade and not controlled by any trust or combination to the detriment of outsiders; second, that this free raw material is converted into leather and shoes with the greatest economy and distributed by manufacturers at a margin of profit made small by the keenest competition; third, that there are no economies in production practiced by foreigners which we can not meet, except labor cost; fourth, that the removal of the present protection would nearly equal the labor cost of manufacture.

The position of the shoe and leather industry is, therefore, unique among all other protective industries, buying its raw materials in competition with all the world, paying the cost of carriage of raw material that is imported to their factories, manufacturing at the great economy, and selling at prices which show small margin.

This great industry is not piling up profits behind a wall of protection, but, on the other hand, asks only for the maintenance of a nominal duty in order to be able to meet world competition in every item except labor cost. A withdrawal of this small protection would find no place to reduce the cost except to cut down the compensation of the laborer. If the difference in the labor cost of leather and shoes is compared with the difference of the cost of living in Europe and America, it would be found that the removal of the duty would compel American laborers to subsist on less than the European cost, and in passing, might we suggest that considering the reduction of tariff, the labor item in relation to the cost, that item should be the basis of protection, and when this is determined as a basis, then the methods of collecting the necessary revenue, and after that nothing additional should be either asked or enacted. If shoe and leather workmen are to be clean, comfortable, well housed, well washed, and well fed, then the labor item in the cost of production of shoes and leather can not be reduced, and it is the only one which could be attacked in the event of the competition of free foreign imports.

The CHAIRMAN. Mr. Clarke, what is the value of the raw skin at the customhouse?

Mr. CLARKE. That depends.

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The CHAIRMAN. I mean the average.

Mr. CLARKE. Raw calfskins, which go into light leathers, green salted skins weigh about 8 pounds, as I stated. When you go into the heavier leathers, they weigh anywhere from 10 to 12 pounds. The CHAIRMAN. What is the value at the customhouse?

Mr. CLARKE. Those skins are worth from $1.75 up to $2.50, depending upon their weight.

The CHAIRMAN. What is the value of those same skins if they come in here tanned?

Mr. CLARKE. A skin which is worth about $1.60 in the raw state would be worth about between $2 and $2.25 tanned and finished. The CHAIRMAN. Then, when the Payne committee took the duty off of hides and reduced your duty from 20 per cent to 15 per cent, they really gave you additional protection?

Mr. CLARKE. Calfskins have always been free. The duty was taken off from hides, but not calfskins.

The CHAIRMAN. You are right about that. That is, they were free by reason of the interpretation of the board and not by the act of Congress. They held that hides did not mean calfskins.

I notice that the amount of importations has fallen off in the last year or two; 1910 it was $278,000; 1911, $194,000; 1912, $129,000; and the census of 1910 gave your total production of calfskins, tanned and dressed in this country, as valued at $42,000,000. You have only a competitive rate at present of about one-fourth of 1 per

cent.

Mr. CLARKE. You are referring to the importation of foreign skins? The CHAIRMAN. The importation of foreign skins, as compared with the American production.

Mr. CLARKE. Yes, sir.

The CHAIRMAN. The rate of duty is practically prohibitive.

Mr. CLARKE. The 15 per cent is practically prohibitive, but a very slight differential of 1, 2, 3, 4, or 5 per cent would change that to a competitive basis at once.

The CHAIRMAN. You think 5 per cent would bring it to a competitive basis?

Mr. CLARKE. Yes, sir; I do.

The CHAIRMAN. Would allow as much as 4 or 5 per cent of importations?

Mr. CLARKE. Sir?

The CHAIRMAN. Would allow as much as 4 or 5 per cent of importations?

Mr. CLARKE. That is a question no one can answer, because there are so many other influences affecting the ebb and flow of merchandise than mere tariff. Tariff alone never either raised or depressed any raw material that I know anything about.

The CHAIRMAN. I am talking about the dressed hide now.

Mr. CLARKE. Well, the dressed hides follow the cost of the raw material. The great forces or tides that swing back and forth in the raw material occur entirely aside from all tariff items which may be introduced. That was seen when so much was said about having cheaper shoes if you took the duty off of hides, and at the time it occurred to me that that was a fallacy. The prices of

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shoes in this country will depend on the cost, the cost depends on the demand and supply of leather the world over, and the tariff is simply a differential, and these tides swing up and down entirely independent of the tariff. It has been a curious coincidence that regarding the war tariff of the Civil War, when it was enacted, at 15 per cent, it was said that hides would not be worth taking off in this country if you took the tariff off. It was taken off and hides immediately commenced to advance. Precisely the same condition ensued when the duty was taken off some few years ago. After the duty was taken off the prices commenced to advance. They never have gone back to the place they were in the nineties.

Mr. HULL. The farmer has not got anything to do with keeping the duty off of hides?

Mr. CLARKE. No, sir.

Mr. HULL. As a matter of fact, the real advantage of it was in equalizing the cost of raw material between the competing buyers? Mr. CLARKE. Precisely. The American tanner went to South America to buy his hides, competed with the European tanner. If he had had an additional 15 per cent to pay after he had bought them in that competition, he was not a free bidder in the world's market, but you take that away, free competition ensued, and the price went up with such a powerful bidder as the American buyer. Mr. HARRISON. Has there not been a very largely increased consumption of leather all over the world in the last few years?

Mr. CLARKE. Yes, there has; and at the same time the economic law has been proven that as countries become more settled the ratio of cattle or hide-bearing animals rather decreases to the number of inhabitants.

Mr. HARRISON. Did more advanced agriculture have anything to do with it?

Mr. CLARKE. There is one little machine used in western America called the milk separator, which enables the farmer to separate the cream from the milk and to feed the skimmed milk to the calves, and in that way a great many more calves are raised, whereas the great reservoir of hides, where we are all to-day, Europe and America, struggling to get our calfskins, is semicivilized Russia, where the poor peasants live, who kill their calves almost as soon as they are born. As Russia becomes more and more civilized the amount of calfskins we can get there will be less, and the fight will be more intense.

Mr. HARRISON. Suppose that leather went on the free list, as some kinds of leather did in the free-list bill that was vetoed by the President, would you then have any recommendation to make concerning tanning extracts?

Mr. CLARKE. Well, it would seem to me rather obvious that with leather on the free list, everything that goes into it, that makes up the composition ought to be equally free.

Mr. HARRISON. How large a proportion of the cost of production of leather would the tanning extracts be?

Mr. CLARKE. What class of leather would you say? Sole leather or calfskin?

Mr. HARRISON. Yes; on rough or sole leather?