6. Reduction of United States exports would lead to contraction in the output of some United States plants and to a decrease in the employment of labor now producing for sale abroad. Nevertheless, the United States ought to be able to deal with these ill effects in such a way as to insure that they would not be serious or permanent. 7. Acceptance of increased imports would compel some United States industries to adapt themselves to sharper competition, and in some cases would lead to smaller profits, reduced activity, or business failure. This consequence would not be a compelling argument against accepting increased imports. Greater rather than less competition is conducive to more efficient production and is in line with a fundamental premise of the American business system. 8. It should not be a guiding principle of United States trade policy to reduce import duties only if this does not damage domestic producers. The welfare of the United States economy as a whole should normally govern, rather than the welfare of individual producers. 9. We [68 percent of the respondents-editor] do not know of any United States producer who, since World War II, has been damaged by a competing foreign product in the United States domestic market. 10. The maintenance of United States exports at a high level is so important to the well-being of the United States as to warrant acceptance of increased imports, if necessary at the expense of injury to some of our domestic producers. The interdependence of the United States and the rest of the free world in matters of trade, as in other respects, is self-evident. 11. Increased imports resulting from reduced tariffs would benefit United States consumers by making available a wider variety of foreign-manufactured goods at lower prices. 12. The objective of a free world market rather than one characterized by governmental interventions in the form of import restrictions and subsidization of foreign customers should be the permanent base of United States foreigntrade policy. The CHAIRMAN. Mr. Preston G. Woolf, president, American Beverage & Supply Corp., Indianapolis, Ind. STATEMENT OF PRESTON G. WOOLF, PRESIDENT OF THE AMERI CAN BEVERAGE & SUPPLY CORP., INDIANAPOLIS, IND. Mr. WOOLF. Mr. Chairman and members of the committee, I wish to thank you for this opportunity to appear before you to express our views on the extension of the Reciprocal Trade Agreements Act. I wish to speak in support of the extension of this act. Our concern has been actively engaged in international trade for many years and our thoughts on the matter are shared, I am sure, by hundreds of other similar firms and industries located within our country. We happen to be located in Indianapolis, Ind., and I can assure you that this typical midwestern city is keenly sensitive to the pulse on international business and political relationships. A drop in the trade and purchasing power of a neighboring country, such as for instance, Venezuela, will be quickly felt in employment and profits of our business in Indianapolis. If this situation is multiplied by the hundreds of other similar firms throughout the United States who are also doing business with many other countries, a serious national downward trend in employment and profits could result within a short time. We consider Venezuela to be an outstanding example of the future world conditions which are within the grasp of your committee to chart and control. It is well known that about 90 percent of Venezuela's income is derived from the sale of petroleum products to the United States. Likewise it is known that the exports from the United States to Venezuela amount to approximately one-half billion dollars per year. The dollars which we pay to Venezuela for her oil, quickly come back to us in payment for the thousands of types of goods and products which our Nation sends to this sister nation. All of Venezuela's purchases from us create a vast demand for agricultural and manufactured products within the United States, which create tens of thousands of jobs in our country; the resulting wealth which is created, is a source of tax collections for our National Treasury. For many years I have traveled as an American businessman throughout Latin America and Venezuela. I have called upon hundreds of business people, both large and small in practically every town in Venezuela. These people represent a cross section of the citizens of Venezuela. These people consider the United States to be a friend and a "business partner." They know that we hold their economic stability within our fingers. More important they are individually and collectively worried about our fluctuating national foreign policy, or lack of policy. Many times I have heard them describe our Nation as "a great and powerful ship, but without a rudder." Naturally our uncertainty as to a national foreign policy has been an ideal subject to be enlarged upon by our enemies, of whom we have many. I have seen many forces at work in Venezuela to undermine our position there. I am sure that should we cast this sister nation asunder economically that we would soon awake to find communism entrenched across the Caribbean. Venezuela is an outstanding example of democracy at work in Latin America. If we knowingly lose our foothold in Venezuela, other Latin countries could fall away like the leaves in the autumn. Remember this for the records. A job, some security, and a hope for a better future is what the men on the street in Venezuela and every nation want. It is even true of us within the States. Yet, it is we who have within our power to decide the economic fate of many of these good people and allies throughout the world. We feel that today our Nation is at the cross roads in our foreign economic policy. We believe that your committee has within its hands one of the most important responsibilities ever to be entrusted to a congressional committee. Our economic relations with other nations can and unquestionably will determine the economic and political stability of the free world. As the leader in the free family of nations we are responsible for the strength and unity of our sister nations. Whenever we fail in this tremendous responsibility the Soviets will be quick to step into any weakened nations to exploit our mistakes and lack of vision. Nothing would please and gratify the Communists more thoroughly than for us to stifle free world trade. A dynamic, expanding American economy with a high level of production and employment and a vigorous broad trade with the free world allies will create a strong family of nations, a secure bulwark against communism. If we wish to prevent the realization of the Soviet hopes for a broken and bankrupt world, we must realize that we cannot exist as an isolated paradise when surrounded by massed misery and despair. The age of our insulation from world-leadership responsibility is past and it is now our duty to posterity to prevent world economic and political disintegration by strong and bold steps to assure free-world trade. No longer can we return to hiding behind protective high tariffs without soon suffering the holocaust of the witches brew of our own making. We cannot seriously consider reversing the trend of the past two decades and again raise trade barriers to the goods and services of our friends, without quickly and surely suffering the consequences. Our Nation has lived well for 2 years under the present Trade Agreements Act, and today we enjoy a high level of productivity and employment. It is the wise and logical course that we do not depart from the legislation which has served so well our national welfare. No changes should be contemplated until the entire subject has been carefully studied by a commission of the President's choice. The decisions which we as a nation make, and which your committee in particular make, have far-reaching consequences. Perhaps never before in history has the course of future events been within the hands and responsibility of so few. The capricious clamor and demands of a few self-centered groups within our country should only be viewed and weighed in the true perspective of the welfare of the whole-our own total economy and the economy and political wellbeing of our allied nations. Therefore, Mr. Chairman, in closing, it is my sincere suggestion and recommendation that no change be made in the existing Trade Agreements Act, and that it be retained unimpaired in the period that lies ahead, until a Presidential commission studies this very broad situation. Not only does our own economic health, but the health and security of the free world depend upon your actions. The historians. of the future will have good reason to refer to your decisions. The CHAIRMAN. Mr. Louis Marbe Cohn of New York? He apparently is not present. His statement if filed with the committee will be inserted in the record at this point. (The statement was not filed.) The CHAIRMAN. Mr. Frank P. Lyons, director, National Government's Advisors, Tampa 6, Fla.? Mr. Lyons has apparently left. His statement will be inserted in the record at this point. (The statement referred to follows:) NATIONS SIMPLY UNORGANIZED GROUPS OF SMALL PEOPLE-WHOM ARE WE DEFENDING? NEW YORK, N. Y., May 18, 1953. Re: H. R. 4294 (opposed to trade agreements). Chairman, Committee on Ways and Means, DEAR CONGRESSMAN: Favor "reciprocal barter free exchange," of subsidies materials for needs. Favor "world credit and debt free exchange bank"; selfsustaining for trade. After arranging to appear before your committee on May 19, visited your hearings and listened to a very dull and stupid defense of the coal industry versus oil imports, with two of your members asleep and I would also if remained over 10 minutes. If the coal barons and labor barons want markets for employment, production and distribution of coal, let them by collective bargaining fight with one another until the price of coal delivered to the people is much cheaper than oil. As 32604-53-122 simple as that. Same refers to all materials for markets, sales and trade not difficult to obtain. Guidance available; cost nil. After 20 years of more pay for less hours, less dollar value for higher costs by Federal debt and taxed subsidies, defended and supported by war, destruction of lives, property and enslavement of people at home and aboad for employment, votes, profits, taxes, we have taxed ourselves out of purchasing power and normal values to distribute and consume our production. Not difficult to reverse. If our Republican administration balanced budget is more important that the lives and destiny of our people, country, and Government, there is nothing you or I can do to balance our budget. To cure ignorance and stupidity, we must rise above the mentality level that creates, defends and maintains it. In other words, cut taxes now regardless. Why not? Guidance available-cost nil. The Hoover boom was created by selling our people worthless foreign securities. The Democrats prosperity created by taxed money, taxed subsidies, taxed gifts, taxed destruction, taxed gold, taxed Federal debt, taxed survival facilities; everyone collecting taxes from one another for employment, wars, destruction, less work for more pay, votes and profits by taxing we defend. Why not stop such financial intrigue, religious fanaticism, political bribery, and military stupidity the cause for all wars. Guidance available; cost nil. On my return to Tampa, my home, may I stop to thank you for your courageous demand to cut taxes now. If insulting those opposed will help, I am at your service. With my kindest regards. Sincerely yours, FRANK P. LYONS. The CHAIRMAN. Mr. George J. Burger, vice president, National Federation of Independent Business, Washington, D. C. Mr. Burger, if you will just give your name and the capacity in which you appear, we will be glad to hear from you. STATEMENT OF GEORGE J. BURGER, VICE PRESIDENT IN CHARGE, WASHINGTON OFFICE, NATIONAL FEDERATION OF INDEPENDENT BUSINESS, WASHINGTON, D. C. Mr. BURGER. I am George J. Burger, vice president, National Federation of Independent Business, Inc., Washington Building, Washington, D. C. The Federation is a nonprofit organization representing independent and small-business men, and professional men, from all parts of the country in all lines of endeavor. It is supported solely by these independent, small-business and professional people. It has the largest individual, directly supporting, membership of any business organization in the Nation. Our members determine our position on all issues directly, by vote through our publication, the Mandate. It is important to know how this voting system works. The Federation regularly furnishes its members with copies of the Mandate which list various issues of importance. Brief argument is made for and against each issue. There is a tear-off ballot which members can sign and on which they indicate whether they are for or against the issues. When a member has marked and signed his ballot, he tears it off and sends it to a local businessman-colleague serving as a Federation district chairman. The chairman collates and tabulates the ballots received. He sends one copy of the tabulation, together with the signed voted ballots, directly to the Congressman who represents the businessman. He sends another to Federation headquarters, where a national tabulation is prepared. The tabulation is presented in the following Mandate. A majority vote determines the Federation position on each issue. To preserve the representative character of the Federation, each member is allowed only one vote. During the past 4 years, our members have voted four times on the general subject of control of international trade. Here are the results of those votes: In the Mandate No. 158 (May 1949), 84 percent of our members voted for a bill proposing that Congress investigate the execution of international trade agreements, to determine whether and how these agreements were damaging domestic independent business. In the Mandate No. 163 (November 1949), 69 percent of our members voted for action by Congress to limit foreign oil imports when they interfere with or damage operations of our domestic independent oil men. In the Mandate No. 169 (April 1950), 80 percent of our members voted for a bill proposing that Congress make a redetermination of the "peril point" provision of our tariff laws, with a view to giving domestic independent business better protection against low-cost imports from foreign nations. In the mandate No. 193 (April 1953), 66 percent of our members voted against a bill proposing the elimination of all tariffs on foreign-built cars, trucks, buses, and parts. We are appearing before you today, on the basis of this policy determination, to support any and all legislation which furnishes the protection sought in these votes. Let me make some points clear: First, federation member operations are almost entirely, if not entirely, confined to the domestic market. Our small, independent business and professional man members are certainly affected for the better or for the worse by what goes on in international trade. But they do not have plants or facilities in foreign nations, to take advantage of any moves which might make shipments into the United States easier or more profitable, at the expense of, and to the damage of, domestic producers and sellers. Second, our members agree that sound foreign trade is vital to our national and to the international welfare. They realize that with the world as sharply dividend and tightly compartmented as it is today, the United States must trade in order to help maintain the free world's strength against the Communist foe. They question, however, the wisdom and value of any policy or enactment which would continue to, or would commence to, undermine the strength and vigor of our own independent, free competitive enterprise system. After all, they believe that few question the plain fact that free, competitive, independent smaller enterprisers are the backbone of our Nation, and that the well-being of the free world depends to a very great degree on the well-being of our economy. Third, our members want it known that in seeking these protections they are not asking any competitive advantage over those who would ship from abroad into our markets. To the contrary, all they ask is some assurance of equality of opportunity with foreign producers. They ask if there is, under a free trade set-up, any equality of opportunity when our domestic enterprisers are tied to a Federal minimum wage scale of $30 a week, while foreign producers have wage scales running down to $5 a week. They ask if there is any equality of opportunity, for instance, in the auto-parts industry when our |