Mr. HASTINGS. You did not say anything about the selling price. Mr. RANDELL. You would have no freight to pay if this was f. o. b.? Mr. HASTINGS. Then we did not get $55.

Mr. RANDELL. How much did you get?

Mr. HASTINGS. Probably $50.

Mr. RANDELL. What is the price?

Mr. HASTINGS. Fifty dollars.

Mr. RANDELL. That would make a difference of about $15?

Mr. HASTINGS. Yes, sir; $7 or $8.

Mr. RANDELL. What was the price a year ago or fifteen months ago?

Mr. HASTINGS. The price was about the same, a little less, if anything, but in the interim it was lower.

Mr. RANDELL. It is higher now than before the panic?

Mr. HASTINGS. It is about the same, a little higher, if anything, than before the panic.

Mr. RANDELL. What caused it to go up?

Mr. HASTINGS. The law of supply and demand.

Mr. RANDELL. What caused it to go down?

Mr. HASTINGS. The same reason.

Mr. RANDELL. There was no demand for it?

Mr. HASTINGS. Exactly.

Mr. RANDELL. I thought that the newspaper people were complaining that they could not get paper unless they paid $10 a ton more for it. Was it the great demand that made it go up $10 a ton?

Mr. HASTINGS. Yes, sir; certainly.

Mr. RANDELL. Where was that demand, in the United States?

Mr. HASTINGS. Yes, sir.

Mr. RANDELL. Was that a sudden demand?

Mr. HASTINGS. It was a gradual, growing demand.

Mr. RANDELL. Was there anything extra in the cost?

Mr. HASTINGS. The cost went up somewhat.

Mr. RANDELL. What was there in the cost of production that made the price of your paper go up?

Mr. HASTINGS. Labor particularly.

Mr. RANDELL. How much higher is your labor now than fifteen months ago?

Mr. HASTINGS. I will not say that there is very much difference in the cost of labor, but when we went from the two-tour to the threetour system then our labor cost went up.

Mr. RANDELL. When was that?

Mr. HASTINGS. In January, 1907.

Mr. RANDELL. You say that there is no understanding throughout the United States or among any of the mills that you know about or in the association which you are president of-that there is no understanding to keep up the price and to have a uniformity of price? Mr. HASTINGS. No, sir.

Mr. RANDELL. Or any division of territory?

Mr. HASTINGS. No, sir.

Mr. RANDELL. Do I understand that you do not know of any such thing or that it does not exist?

Mr. HASTINGS. I do not believe it exists. Our association has nothing to do with it in any event. All the men who make paper do not belong to our association.

Mr. RANDELL. Do you think there is any chance for competition to come in, any reasonable business chance, which would reduce the price of this paper that you say the demand caused to rise, if the tariff remains as it is now?

Mr. HASTINGS. Yes, sir; it has in the past.

Mr. RANDELL. Where?

Mr. HASTINGS. There is one mill in construction in Minnesota with a capacity of 200 tons a day with a promise to the prospective buyers of bonds and stocks that they can within six months or a year double the capacity. That is in the United States under the protective tariff. I do not believe that they could sell the stocks and bonds if you took the tariff off.

Mr. RANDELL. How did you find that out?

Mr. HASTINGS. That is public property; it has been in the papers. Mr. RANDELL. Has it any connection with your mills?

Mr. HASTINGS. No, sir.

Mr. RANDELL. That would be an increase of 400 pounds as against 3,500 pounds a day now?

Mr. HASTINGS. Yes, sir; practically 10 per cent.

Mr. RANDELL. Will that, in your opinion, cause the price to go down?

Mr. HASTINGS. It has always had a lowering effect.

Mr. RANDELL. Do you think that when that mill goes into operation the effect will be to reduce the price $10 a ton?

Mr. HASTINGS. It will have a lowering effect. I will not state any amount, because I do not know. It depends on whether the market absorbs the product.

Mr. RANDELL. Does it cost more to make the paper now?

Mr. HASTINGS. Yes, sir.

Mr. RANDELL. Why? .

Mr. HASTINGS. I have tried to explain that.

Mr. RANDELL. Is the stumpage higher?

Mr. HASTINGS. We have not any stumpage.

Mr. RANDELL. Have you any timber lands?

Mr. HASTINGS. No, sir. We buy the wood. We have a small mill compared with some of the other mills.

Mr. RANDELL. You represent this association, but you only have a few mills yourself?

Mr. HASTINGS. Only one mill.

Mr. RANDELL. Do you think that if the revenue was increased by lowering this tariff that it would injure your business?

Mr. HASTINGS. Yes, sir; it would.

Mr. RANDELL. Suppose we cut the tariff in two, what effect would that have?

Mr. HASTINGS. Three dollars a ton is more than a mill of our class has made on an average in ten, fifteen, or twenty years.

The CHAIRMAN. Are you a practical paper manufacturer?

Mr. HASTINGS. Yes, sir; I think I am, sometimes.

The CHAIRMAN. You claim that a duty equivalent to about 15 per cent is necessary for the protection of the American manufacturer? Mr. HASTINGS. Yes, sir; I do.

The CHAIRMAN. I want you to give me the facts, showing why that duty is necessary.

Mr. HASTINGS. In written shape, you mean?

The CHAIRMAN. I would like to have them "right off the bat " and now.

Mr. HASTINGS. I would rather give you that data a little later than to give it in such shape that I might be picked to pieces here. The CHAIRMAN. You are not prepared to give it now?

Mr. HASTINGS. I would rather not. I would rather submit it to the committee.

The CHAIRMAN. Have you that information in written shape now? Mr. HASTINGS. No, sir."

The CHAIRMAN. You will put it in a brief and file it with the committee?

Mr. HASTINGS. Yes, sir.

The CHAIRMAN. As far as I am concerned, I am more interested in that question than any other. I want to know why the protection is

necessary.

Mr. HASTINGS. I will be very glad to give you that information. In a general way I have stated that in this brief which I will file, but if we are going to get into a tariff argument I do not want to stand up here and be picked to pieces by gentlemen who know more about it than I do.

Mr. CLARK. Do you really think that there is anybody in this room who knows more about the paper business than you do?

Mr. HASTINGS. I think you know more about the tariff.

Mr. CLARK. In a general way that may be, but you have a particular part of the tariff to talk about that you know more about than I do.

The CHAIRMAN. Is there anyone here to give that information?

Mr. HASTINGS. Yes, sir; a gentlemen will follow me who can give that information.

Mr. GRIGGS. The importations of print paper last year are given 21,123,254 pounds, value, $596,819, and the duty paid $96.000. The exportations, you understand, which we have been discussing here, were 120,090,056 pounds, with a value of $3,514,281. Will you tell me why it is that we are able to export in competition with the foreign concerns?

Mr. HASTINGS. Is that pounds?

Mr. CLARK. Dollars.

Mr. HASTINGS. Under what heading is that?

Mr. GRIGGS. "Exportations of printing paper.”

Mr. CLARK. It is a government document.

Mr. HASTINGS. I know that I have never run across such figures and such a discrepancy; I do not understand it.

Mr. GRIGGS. You can not explain that?

Mr. HASTINGS. No, sir.

Mr. GRIGGS. We sent 48.000.000 pounds to the United Kingdom; 18,000,000 pounds to Japan; 12,000,000 pounds to Argentina; 6,000,000 pounds to Canada, the place you seem to be so much afraid of; 8.000.000 pounds to Australia, Tasmania, and New Zealand; 6,000,000 to Chile; 7.000.000 to Cuba, and more than a million pounds to Uruguay and Mexico each. Do you not think that pretty well covers the world?

Mr. HASTINGS. Yes, sir. I think we would cover the whole world if you would give us more protection.

Mr. GRIGGS. Do you not think that you have covered it pretty well now?

Mr. HASTINGS. We are doing very well, but we could do better. We have lots of nerve; the trouble is we have not enough money.

Mr. CLARK. The chairman asked you about the various items that made up this cost so that you required this 15 per cent duty to enable you to come out as you have come out; whether that is in the hole or not, I will not undertake to say now. That is one phase of this matter. Another one is that the Treasury is running behind at the rate of about $12,000,000 a month

The CHAIRMAN (interrupting). You have not the latest information. The condition has improved.

Mr. CLARK. If it has improved, I am glad of it.

The CHAIRMAN. Business is improving.

Mr. CLARK. Business has not improved except in the newspapers. The CHAIRMAN. We will soon have a surplus.

Mr. CLARK. There is a large deficiency in the revenues; whether it is as large as I stated or as little as the chairman makes it, does not make any difference. We have got to make up that deficiency somewhere. That is one of the functions of this committee. Do you not think that the paper manufacturers in the United States ought to be willing to stand their part of whatever hardship it is to raise this deficiency in the revenues like everybody else has to stand their part? What do you say, as an American citizen?

Mr. HASTINGS. I say that we are paying our part.

Mr. CLARK. But you are not doing anything, according to these figures that Mr. Griggs has just read to you, because there has only been contributed $196,000.

Mr. HASTINGS. I do not understand that. In the first place, if we import $20,000,000 worth of paper on a basis of 15 per cent, I do not understand why it would not be over $196,000.

Mr. CLARK. If it is over $300,000, that is a small amount. You are not willing to stand any reduction in the tariff, according to your present attitude.

Mr. HASTINGS. We say that we are standing something now; we are standing it on the materials that go into the manufacture of paper. Mr. CLARK. What is the difference between the American price of your paper and the foreign price-$10 a ton?

Mr. HASTINGS. No, sir; I do not think it is.

Mr. CLARK. Do you not sell the same paper which you sell to the American consumer at $55 and $60 a ton in Europe at $15 and $50 a ton?

Mr. HASTINGS. No, sir.

Mr. CLARK. Now, as a matter of fact, do you export paper?

Mr. HASTINGS. I have in the past, but not of late years.

Mr. CLARK. What is the difference between the selling price in Europe of American news paper and the selling price in America? Mr. HASTINGS. I do not think there is any difference.

Mr. CLARK. Do you want to stand on that question?

Mr. HASTINGS. I do, as far as the American paper is concerned.
Mr. CLARK. According to your figures, you make a net profit of

$8 on every ton of paper you manufacture?

Mr. HASTINGS. We do to-day, but not yesterday.

The CHAIRMAN. You are making more than a year ago?

Mr. HASTINGS. No, sir.

Mr. CLARK. Then the panic has not hurt you a particle?

Mr. HASTINGS. I do not know how you can say that.

Mr. CLARK. If you are making as much profit now as then? Mr. HASTINGS. How about six months ago; you make a big jump in a year?

Mr. CLARK. We have been measuring things here by common consent by the year.

Mr. HASTINGS. But the question has been put to me what it was to-day and nothing was said about what it was six months ago.

Mr. CLARK. How much profit were you making on a ton of paper a year ago?

Mr. HASTINGS. About the same amount.

Mr. CLARK. And how much about six months ago?

Mr. HASTINGS. We were selling paper six months ago at 2 cents. Mr. CLARK. How much is that a ton?

Mr. HASTINGS. Forty-five dollars.

Mr. CLARK. And it was $55 a year ago?

Mr. HASTINGS. Fifty dollars to $55. Of course there are different grades.

Mr. CLARK. I know.

Mr. HASTINGS. The price is $2.50, or $50 a ton, for something that Mr. Norris might use in the Times and $55 for the same paper to some little fellow out in Squeedunk, the difference in the price being the actual difference in the cost.

Mr. CLARK. The fellow out in Squeedunk would be considered a retail buyer?

Mr. HASTINGS. It costs us more to produce the paper and put it up in bundles and wrap it.

Mr. CLARK. That is practically the retail trade; that would not be the case with Mr. Norris?

Mr. HASTINGS. If Mr. Norris was to say that he wanted his paper all in sheets and bundles we would charge him $5 more.

Mr. CLARK. I am trying to get some information, although it is pretty hard to do.

Mr. HASTINGS. I want to set myself right. I am perfectly willing to answer all the questions I can, Mr. Clark.

Mr. CLARK. You got $55 a ton practically a year ago?

Mr. HASTINGS. Yes, sir.

Mr. CLARK. And you got $45 six months ago?

Mr. HASTINGS. Yes, sir; and it has gone up to $55 again.

Mr. CLARK. What made it go up?

Mr. HASTINGS. The law of supply and demand.

Mr. CLARK. There is not any more demand for news paper now than

six months ago?

Mr. HASTINGS. There is less being made.

Mr. CLARK. How did that happen?

Mr. HASTINGS. God shut off the rain in most parts of the country.

Mr. CLARK. You did not have any drought in the East.

Mr. HASTINGS. Yes, sir; a very serious one.

Mr. RANDELL. Your mill is located at Niagara Falls?

Mr. HASTINGS. Yes, sir.

Mr. CLARK. Was there any scarcity of water at Niagara Falls? Mr. HASTINGS. That is the reason we are making a little profit.