comes in, as the foreigner can export to this country profitably at any time, pay the duty, and leave him a profit. In Germany they can export their surplus at an actual manufacturing loss and keep their prices up in the home market. If the duty were removed it can be readily seen what the outcome would be. MEMORANDUM OF SAVING IF DUTY WERE REMOVED AND THE SAVING ACCRUED TO THE PURCHASER. While I do not admit that the removal of the duty on news paper would result in a saving to the publishers of the duty collected, supposing for the sake of argument that it did, an eight-page paper of the Staats Zeitung size, of New York City, of the date of December 3, 1908, as an example, 1,000 copies would weigh 120 pounds. At 2 cents per pound, the cost would be $2.70, or the cost per single copy of 2 mills. The present duty, amounting to $6 per ton, would amount on 1,000 copies to 36 cents, or on a single copy to thirty-six one hundredths of a mill. It takes 8 papers to weigh 1 pound. On the average rural newspapers using a sheet of paper 30 inches by 44 inches, weighing 100 pounds to 1,000 sheets, having a weekly circulation of, say, 1,000 copies or 52,000 copies in a year, the saving would be, if the price were 2 cents per pound, $15.60, or on a single copy three-tenths of a mill. It would take 10 papers of this size to weigh 1 pound. ARTHUR C. HASTINGS. President American Paper and Pulp Association. THE MOUNT TOM SULPHITE PULP COMPANY ASKS RETENTION OF PRESENT DUTY ON ITS PRODUCT. COMMITTEE ON WAYS AND MEANS, BOSTON, December 3, 1908. Washington, D. C. DEAR SIR: The Mount Tom Sulphite Pulp Company manufactures a high grade of bleached sulphite pulp, about 30 tons daily, for fine papers, such as fine book and writing paper, and all its product is sold to mills making such paper and replaces just so much foreign pulp, as our competition is directly with the mills in Sweden, Norway, and Germany. The cost of labor at this plant is double that of the mills referred to above per ton of pulp made; we work our men on three tours in twenty-four hours instead of two tours, as the foreign mills do. We put just the same amount and kind of work in the preparation of our wood as is done in Europe-that is, in barking, boring out knots, cleaning chips, etc.--and where they employ boys, and even girls, we are compelled to employ men, as boys and girls for this kind of work in this country are not to be had or allowed by law. We cook our fiber long hours, putting the same amount and kind of work in washing, screening, bleaching, rescreening, etc., as they do. None of the grade of pulp we manufacture is exported, while a very large amount (43,000 tons in 1897, or 42 per cent of all bleached pulp sold in this country) is imported. From figures already submitted to your committee by the pulp and paper men you will see that this cost of labor enters into every department of our mill, cost of plant per ton capacity, cost of cutting, logging, driving our timber, cost of mill supplies of all kinds, etc. We have been nearly twenty years building up this plant under the most adverse circumstances, and the present tariff does not represent the advantage the foreign mills have over us. If it is taken off or reduced, we believe it would mean the closing down of our plant. We employ from 150 to 175 men, according to the season of the year, at this plant. The plant represents $755,000 invested capital, and we have quite a suburb of Northampton, Mass., dependent on us, with a fine new schoolhouse in which we are educating from 60 to 70 children, mostly of foreign parentage. Yours, truly, CHAS. C. SPRINGER. INTERNATIONAL PAPER COMPANY, NEW YORK CITY, FILES SUPPLEMENTAL BRIEF RELATIVE TO WAGES AND COSTS. NEW YORK, December 19, 1908. Hon. SERENO E. PAYNE, Chairman Committee on Ways and Means, Washington, D. C. DEAR SIR: We desire to supplement the statement in regard to Schedule M, which we submitted to your committee on November 21, with additional data. Wages.-Exhibit A, attached, is a comparison of our regular schedule of wages in force July 1, 1908, with the wages paid in the following Canadian mills: Laurentide Paper Company (Limited), Grand Mere, Quebec. Belgo-Canadian Pulp and Paper Company, Shawinigan Falls, Quebec. St. Raymond Paper Company (Limited), St. Raymond, Quebec. Imperial Paper Mills of Canada (Limited), Sturgeon Falls, Ontario. J. R. Booth, Ottawa, Ontario. This comparison is based on a table of wages, marked "Exhibit B," which gives the wages for each position in each of the six Canadian mills given above, which are the only ones at present making news paper. This data was obtained through a labor organization whose representatives visited each mill and interviewed the various classes of employees. They are ready, if called upon, to make affidavit that the figures are correct to the best of their knowledge and belief. A mere glance is sufficient to show a decided excess in the wages paid by this company over any of the Canadian mills. At the end of Exhibit B, however, is a statement of averages also reduced to a basis of percentages. While these averages are not mathematically strictly correct, because the wages are not weighted by the number of employees in each occupation, yet we believe that the conclusion is sound-that the disparity between our wages and Canadian wages is understated rather than overstated-for the reason that the difference in the wages paid to low-class labor (employed by the hour) is greater than the difference in the wages paid to high-class labor (employed by the week), and the low-class labor being much the more numerous the true percentage of excess wages paid by us would be greater than that shown. It should be further stated that in comparing our schedule with each Canadian mill only the positions or wages are taken into account in our schedule which are given in the schedule of each of the Canadian mills with which comparison is made. It will be seen that the average wages in the International Paper Company paid to those who are employed by the week exceed the corresponding average wages at each mill by the following percentages: 48.7, 36.5, 45.0, 16.6, 17.3, 26.2; and that the average hourly wages of the International Paper Company exceed the corresponding Canadian wages in each mill by the following percentages: 74.4, 58.9, 59.5, 69.4, 55.7, 55.3. For the sake of more readily grasping the difference as a whole, we have averaged the weekly rate for all the Canadian mills and the hourly rate as well, showing that the International Paper Company's weekly wages average 30.6 per cent more than the Canadian mills and that the International Paper Company's hourly wages average 60.5 per cent more than the Canadian mills. Finally, we have averaged these two percentages (weighted by the number of positions) and find that the average schedule of the International Paper Company exceeds the average wages in all the Canadian mills by 57.6 per cent, which, as previously stated, is probably less than the actual true excess. Supposing our wages, however, are only 50 per cent more than the Canadian wages, the difference in the cost of labor in a ton of paper in favor of the Canadian mill would be $2.66, as against $2.50, as stated in our memorandum submitted November 21. We believe that the actual difference is not less than $3. Cost of wood. As nearly as we have been able to ascertain, the Canadian mills pay as follows for rough wood per cord delivered at This confirms our statement previously made that the Canadian mills pay on an average $6 per cord. Freight on paper.-When under examination, the writer stated that the difference in freight rates to our market from our mills and from Canadian mills, respectively, did not amount to very much and was negligible compared with the difference in the cost of wood and labor. The following table shows approximately the average rate paid by us during 1907 to reach the cities enumerated, also the minimum rate from the Canadian mill to the same points, rates being per 100 pounds on carload lots: We estimate that this gives us an advantage on all of our business. of only about 75 cents per ton. Exhibit C gives the rates from each of our principal news mills to the above-named cities. Exhibit D gives the rates from each of the Canadian mills to the same points. PER CENT OF NEWS PAPER MADE BY INTERNATIONAL PAPER COMPANY. Exhibit E is a list of the mills making news paper in the East and Exhibit F a list of those in the West, which show that the International Paper Company makes only about 44 per cent of the "news" made in the East and only 33 per cent of that made in the whole country. PHYSICAL CONDITION OF ITS MILLS AT TIME OF ORGANIZATION OF INTERNATIONAL PAPER COMPANY. In spite of general and specific refutations in the past, nevertheless representations have been made to your committee that the International Paper Company was composed at the time of its organization of a collection of inefficient and dilapidated plants. While we apprehend that your committee is more concerned with present conditions than those of ten years ago, we deny absolutely this claim and assert that the statements which have been presented in support of it are practically without exception exaggerated, distorted, and false. At the time the International Paper Company was organized, while it did not take in all of the "news" mills, the properties it purchased represented the most efficient plants at that time in exist When it is considered that the manufacture of news paper in the United States exceeded in quantity that manufactured in any other country in the world, and that the individual plants were larger and many of them better than any plants in the world, and that news paper was then sold in the United States more cheaply than in any other market, it is absurd to claim that there could be a consolidation of two-thirds or three-quarters of the existing plants without such consolidation being of a high grade of efficiency as to its physical 'condition. As an illustration of the falsity of the statements recently made to you, we quote the following: An allowance of nearly $8,000,000 was made for a mill (Glens Falls), one-half of which might better be located upon Boston Common or in New York City. Five years previous the stock capital of that concern had been $300,000. This same statement was made before the Committee on the Judiciary in its hearings on Lilley resolution, No. 243, in 1904, and a specific answer was made thereto, which is as follows: The total capitalization of the Glens Falls Paper Mill Company issued and paid up was considerably more than $3,000,000, instead of $300,000, as stated. But the capitalization did not by any means cover the whole amount of money invested. The original Glens Falls Paper Company was organized and began business in the year 1864. It was owned and controlled by a few individuals who were directly interested in and connected with the management of the property, and who were more interested in building up a large and valuable manufacturing plant than they were in paying dividends. Consequently, they devoted the greater part of the earnings for many years to the enlargement and extension of the plant, the acquisition of woodlands, and other property necessary for their purposes. In this way, prior to the formation of the International Paper Company, the Glens Falls Company had acquired and built up a valuable and successful plant and property, a large part of which was provided for out of earnings for which no capitalization had ever been issued. This property included, among others, the following: 1. Paper mill at Glens Falls, making paper and ground wood pulp, with the use of its own very valuable developed water power on the Hudson River at that point. 2. Mills at Fort Edward, making paper, ground wood and sulphite pulp, with the use of its own very valuable water power on the Hudson River at that point. 3. Undeveloped water power on the Hudson River and other property above Glens Falls. 4. A great undeveloped water power with 250 feet head on the Saranac River at Cadyville. 5. 62,990 acres of woodland in the Adirondacks tributary to said mills, and also a large amount of woodland in Canada held under Canadian permits. 6. A fine water-power of about 100 feet head, partly developed, on the Lamoille River, in Vermont, since utilized by the erection by the International Paper Company of a pulp mill. 7. A valuable undeveloped water power with a head of over 65 feet on the Lamoille River, in Vermont. The plants above mentioned, purchased from the Glens Falls Company, have an aggregate capacity of over 300 tons of paper per day. For the plants and property so purchased the International Paper Company paid, in its securities, about $6,000,000, instead of $8,000,000, as stated, and we confidently believe that the properties enumerated are worth more than the amount paid for them. STATE OF NEW YORK, City and County of New York, 88; Frederick H. Parks, being duly sworn, deposes and says that he is the first vicepresident of the International Paper Company; that he has read the foregoing statements, and that the allegations contained in the same are true to the best of his knowledge and belief. Sworn to before me this 21st day of April, 1904. [SEAL.] Certificate filed in New York County. FREDERICK H. PARKS. E. W. KENNEDY, Notary Public, Kings County. |