If produced in the United States at wages three times as great as covered by the inventory on an inventory consisting of 75 per cent labor and 25 per cent merchandise stock, the laid-down value of the $1,000 inventory is:

Merchandise stock

Labor

Total present laid-down value, American manufacture_____

$250 2,250

2,500

If a tariff of 75 per cent, as proposed, prevailed, the conditions would be as follows:

On an inventory of $1,000, where the labor value is 50 per cent of the total, the laid-down value of $1,000 inventory is $1,275.

If produced in the United States, at wages three times as great as covered by the inventory value, consisting of 50 per cent labor and 50 per cent merchandise stock, the laid-down value of the $1,000 inventory is:

Merchandise stock..
Labor

Total present laid-down value, American manufacture__

$500 1,500

2,000

If a tariff of 75 per cent prevailed, the total laid-down value of the $1,000 inventory would be $1,775.

Illustration No. 3.

On an inventory of $1,000, where the labor value is 25 per cent of the total, the laid-down value of $1,000 inventory is $1,275.

If produced in the United States at wages three times as great as covered by the inventory, value on an inventory consisting of 25 per cent labor and 75 per cent merchandise stock, the laid-down value of the $1,000 inventory is:

If a tariff of 75 per cent prevailed, the total present laid-down value on this inventory would be $1,775.

Conclusion.

From the above tables it is apparent that with a tariff of 75 per cent the merchandise stock values of the average inventory would have to be in excess of one-half of the total inventory before the American manufacturer would be able to deliver the goods at a price equal to the price quoted by the foreign manufacturer.

WILLIAM PARKER CUTTER, REPRESENTING THE BOOK-BUYING COMMITTEE OF THE AMERICAN LIBRARY ASSOCIATION, ASKS THAT THERE BE NO CHANGE IN BOOK SCHEDULES.

SATURDAY, November 21, 1908.

The CHAIRMAN. Do you want to submit something now, or to complete what has been said?

Mr. CUTTER. I want to be heard in opposition to any change in the free list of books, in behalf of libraries.

The CHAIRMAN. Have you a printed brief?

Mr. CUTTER. No, sir; but I have some remarks in notes here.
The CHAIRMAN. A written or a printed brief?

Mr. CUTTER. I have a written brief. I will be very glad to submit this in written form and to read only one or two extracts from it, with your permission.

There are two reasons why I wish, on behalf of the libraries of this country, to protest against any curtailment of the privilege of importation free of duty books for public libraries. The first is that such action as I suggest is for the good of the whole people of the United States. The institutions to be benefited are such as have been established solely for the intellectual uplifting of our race. They are not institutions conducted for profit, but on the contrary they are often hampered for funds, and their usefulness is impaired by a lack of financial resources.

The other point is in regard to protection for the American printer. which I believe is the basis of the argument of the printer for removing that privilege from the free list. I have brought some figures here from my own library, from my own experience, in which I have attempted to estimate the amount of protection that would be accorded to the American printer by the putting books that we import free on the dutiable list. During the last fiscal year the total importations were about six and one-half millions of dollars, or about 2.7 per cent of the total books in the country produced or imported. The duties from importations were about 1.4 per cent of the total. The wages paid for the production of the articles were $49,000,000. or about 20 per cent of the value of the finished, manufactured, or printed article. The wage cost of the imported article if printed in the United States, therefore, would on this basis be 20 per cent of the cost of the manufacture, which is about 25 per cent of the publisher's wholesale price, or would be 5 per cent of the importation. value. That is the wage value of the books that we buy. On the duty-free importations it would be $168,759, whereas the duty, if paid, would be $843,795. In other words, our friends, the printers. are asking the public institutions of this country to tax themselves $25 for every $5 of protection.

As I have already pointed out to you, public libraries are importing only about a quarter of a million dollars of books currently printed. from all sources, per annum, and of these only $100,000 worth, those printed in English, would probably be printed in this country. I took my bills for the last four years and checked off those which by any

possibility would be ever printed in this country commercially. These would cost the manufacturer $20,000, and the wage-earner's share would be $5,000. I submit it is not right to ask this committee to change that item in the free list so that 188,000 printers could get $5,000.

Mr. CRUMPACKER. Do you know of anyone advocating the imposition of a duty on foreign books imported for public libraries?

Mr. CUTTER. I understood from the newspaper reports that such a thing would be advocated before the committee. (See p. 1062, where New York Typothetæ advocate this.)

The CHAIRMAN. What paragraph is that?

Mr. CUTTER. 503.

The CHAIRMAN. The contention is simply with reference to rebound books, is it not?

Mr. CUTTER. No, sir; but I can speak of that subject also.

The CHAIRMAN. The complaint is made that the public libraries are taking advantage of this paragraph to have books rebound in Europe and brought in here in order to save the expense on binding?

Mr. CUTTER. No, sir; I am doing that myself. That is not the reason. We can not get the work done in this country as well. We have tried.

The CHAIRMAN. But that is the complaint, and that is what you are contending against?

Mr. CUTTER. Yes, sir; I am contending against that complaint simply because we have tried, gentlemen, to get that work done, and can not have it done as well here.

Mr. GAINES. That work is what?

Mr. CUTTER. Rebinding books, so that they can be circulated from 100 to 150 times. We have not been able to have it done satisfactorily here.

Mr. GAINES. What peculiar character of binding is that which can not be done in this country?

Mr. CUTTER. We can not make the binders understand what we want. It is a different kind of binding. A man has a method of sewing which is not used by anyone else in this country.

Mr. BOUTELL. What would be the effect of admitting free all books of foreign authors printed abroad, and in ordinary binding?

Mr. CUTTER. It would be the best thing, sir, I think, for the people of this country, speaking from the intellectual standpoint, that could be. It would make books very much cheaper.

Mr. BOUTELL. Have you figured out that it would be a great loss to anybody?

Mr. CUTTER. I do think it would.

Mr. CRUMPACKER. Would it not affect the interests of prirters in this country?

Mr. CUTTER. Yes, sir; I do think it would. It would much more seriously affect publishers, who are only middlemen selling manufactured articles.

WILLIAM PARKER CUTTER, REPRESENTING AMERICAN LIBRARY ASSOCIATION, ASKS THAT THERE BE NO CURTAILMENT OF DUTY-FREE IMPORTATIONS OF BOOKS.

WASHINGTON, D. C., November 21, 1908.

COMMITTEE ON WAYS AND MEANS,

Washington, D. C.

Mr. Chairman and gentlemen of the committee, I appear before you as the representative of the American Library Association, an organization having 2,000 members, and the only organization which can speak for the libraries of this country. I may say, therefore, that I am here to speak for 6,000 libraries, containing 60,000,000 volumes, adding yearly 3,000,000 volumes, and expending yearly $10,000,000. Through these libraries, I may fairly claim to represent a majority of the reading public in the United States.

I am here to protest against any curtailment of the privilege of . duty-free importation which these institutions have enjoyed for so many years. I am here to advocate the inclusion in any bill you may recommend of a clause or paragraph similar to that in the existing law, allowing of duty-free importation of printed matter for the use of such libraries, educational institutions, and societies, and would suggest, if any amendment is made of existing law, such amendment should be in the line of extending the privilege rather than of curtailing it.

There are two reasons why I urge your committee to this action. The first is fundamental. It is because such action as I suggest is for the good of the whole people of the United States; the institutions to be benefited are such as have been established solely for the intellectual uplifting of our race; they are not institutions conducted for commercial profit, but, on the contrary, are often hampered for funds and their usefulness impaired by lack of financial resources. Any help that can be given to them by this Government is helping the education of the citizen, on whose intelligence our prosperity as a nation and a republic must depend.

And, statements to the contrary notwithstanding, the loss of revenue to the Government is slight compared with the benefit conferred. The total imports of books and other printed matter into the ports of the United States during the fiscal year ended July 30 was valued at $6,541,309, and of this material, $3,379,182 was imported free of duty. The material allowed free entry is of three classes. First, books wholly in foreign languages; second, books in English which have been printed twenty years; third, books imported for the use of the United States, the Library of Congress, and for use by libraries, educational institutions, and societies of a literary and scientific character. It is my opinion that the importation of books in foreign languages and of books printed previous to 1888 make up 90 per cent of the total of duty-free importations. I may be wrong, but that is my impression after fifteen years' experience. I can confidently say that the total importation of new books in English by libraries does not exceed a quarter million dollars per year. On these, the duty would amount to about $62,500.

Now, as to the protection for the American workman, for we all want to protect him, if we do no great wrong to other interests.

Of the total imports of books during the past fiscal year, $3,379,182 were admitted free of duty. Under the existing law, three classes of books may be imported duty free: Books in foreign languages, books which have been printed twenty years, books for libraries and educational institutions. Neither of the first two classes would naturally be printed to any great extent by American workmen, and there would, from the protective standpoint, be no reason for putting a duty on them. Of books printed in the English language since 1888, libraries and public institutions are the sole duty-free importers. I do not believe, after fifteen years' experience, that of these over a quarter of million dollars' worth are imported every year. Of these, from their very nature, few would be reprinted in this country. I do not believe that $100,000 worth would be so reprinted. The cost of manufacturing a book is about 20 per cent of its net selling price, and the cost of the labor involved is little more than 5

per cent. According to the census of 1905 (Bulletin 79, published in 1907), the total product of the book and job printing establishments in this country was $233,230,842. The total importations were $6,451,309, or 2.76 per cent of the total books in the country. The duty-free importations were about 1.4 per cent of the total. The wages paid for the production of these articles in the United States were $49,061,030, or about 20 per cent of the value of the printed article. The wage cost of the imported article, if printed in the United States, therefore, would on, this basis be 20 per cent of the cost of the manufacture, which is about 25 per cent of the publisher's wholesale price, or would be 5 per cent of the importation value. On the duty-free importations it would be $168,759, whereas the duty, if paid, would be $843.795. In other words, our friends the printers are asking the public institutions of this country to tax themselves $25 for every $5 of protection. As I have already pointed out. to you, public libraries are importing only about a quarter of a million dollars of English books currently printed, and of these only $100,000 worth would probably be printed in this country. These would cost to manufacture $25,000, and the wage-earners' share of this would be $5,000. It is to afford this protection that you are asked to tax the educational institutions of this country.

Who gets the protection if the printer, binder, and color printer does not? Let me point out that the duty of 25 per cent is greater than the cost of manufacture of the book in this country. It is over 100 per cent of the cost of manufacture. Who is protected? As usual, the middleman. The publisher pays only 2 or 3 per cent of his selling price in greater wages for American workmen, and wishes to pocket the other 20 or more per cent himself.

As I have above stated, the duty that would be levied on new English books imported by libraries would amount, on those books that would be reprinted in this country, to $25,000. Were this the only result of abolishing the privilege of free entry, I should be less insistent on having that privilege retained. But it is the smallest part of the result.

The true inwardness of the arguments for doing away with free importation lies in an attempt on the part of a few firms in New York City to gain for themselves an absolute control of the price at