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PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

Mr. HILL. There are importations every day made by the hide and leather importers, are there not?

Mr. VOGEL. Yes, sir.

Mr. KITCHIN. Is it not a fact that we are exporting sole leather in competition with all the world-England, Germany, and France? Mr. VOGEL. Yes, sir.

Mr. KITCHIN. And we are the biggest exporters of sole leather in the world, are we not?

Mr. VOGEL. Yes, sir.

Mr. KITCHIN. And we import only about a million dollars' worth a year, and export from nine to twelve million dollars' worth a year; is not that a fact?

Mr. VOGEL. Yes, sir.

Mr. KITCHIN. And we are making sole leather as cheaply and selling it here as cheaply as it is sold anywhere in the world, are we not?

Mr. VOGEL. No, sir.

Mr. KITCHIN. And for this nine or ten million dollars' worth of leather we export yearly to foreign countries we are getting a higher price abroad than we are getting at home?

Mr. VOGEL. No, on an average about the same price.

Mr. KITCHIN. So that this tariff on leather amounts to very little one way or another, does it not?

Mr. VOGEL. It depends on what you call "little," of course.

Mr. KITCHIN. That is the profit. But you are paying now threequarters of a cent on your extract and still making it cheaper and selling it cheaper than any people in the world?

Mr. VOGEL. No, sir.

Mr. KITCHIN. So, if you reduce your tariff on your extract here you could get along with free leather all right, could you not? Mr. VOGEL. No, sir; we could not.

Mr. KITCHIN. You are now underselling the world in sole leather with a tariff on this stuff?

Mr. VOGEL. I purposely called your attention to the important fact that since 1911 the imports into this country were very rapidly increasing, as shown by this table which I have submitted to you. Mr. LONGWORTH. They have trebled, have they not?

Mr. VOGEL. Yes, sir; they have trebled in that time.

Mr. KITCHIN. And your exports have grown very rapidly, too?
Mr. VOGEL. No, sir; they have not grown in proportion.

The CHAIRMAN. Gentlemen, we are being called away from the chemical schedule in this hide proposition.

Mr. VOGEL. I was not prepared to argue this question to-day. Mr. PAYNE. I would like to know, in that connection, whether we are exporting sole leather in any quantity?

Mr. VOGEL. We are; yes, sir.

Mr. PAYNE. Is not the most of the leather the fancy leathers, and of a higher grade of manufacture than sole leather?

Mr. VOGEL. We have always exported large quantities of glazed kid from this country.

Mr. KITCHIN. The record shows we exported about $20,000,000 worth of glazed kid last year, and of sole leather over nine millions.

Mr. PAYNE. Is it not a fact that of the higher grades of leather we make the best in the world?

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

Mr. VOGEL. We hope we do.

Mr. PAYNE. We do; that is the reason we are exporting it. Why not have the whole truth?

Mr. KITCHIN. He has told too much about it now.

Mr. JAMES. We do not want to give it all to you at once. [Laughter.]

Mr. LONGWORTH. Do you sell rough leather in Canada?

Mr. VOGEL. We do not.

Mr. LONGWORTH. Not at all?

Mr. VOGEL. Not to my knowledge is any rough leather being sold from this country to Canada.

Mr. LONGWORTH. Do you sell sole leather in Canada?

Mr. VOGEL. No, sir; it is impossible to sell any sole leather in Canada.

Mr. LONGWORTH. Why?

Mr. VOGEL. Because they are evidently able to buy cheaper at home.

Mr. LONGWORTH. Do you sell abroad any leather cheaper than you sell at home?

Mr. VOGEL. No, sir; we do not. We never trade on that basis. Mr. LONGWORTH. You sell abroad cheaper than you do at home? Mr. VOGEL. No, sir.

The CHAIRMAN. I would like to get back to the chemical schedule Mr. Vogel, have you anything further?

Mr. VOGEL. I have nothing further to say. I am very much obliged to you gentlemen for your attention.

STATEMENT OF M. S. ORTH, REPRESENTING MARDEN, ORTH & HASTINGS, BOSTON, MASS., DEALERS IN TANNING EXTRACTS; AND THE BASIC EXTRACT CO., BASIC CITY, VA., MANUFACTURERS OF CHESTNUT EXTRACT.

Mr. ORTH. Mr. Chairman, with reference to Schedule A, paragraph 22, I think that the tariff should be revised downward on materials where the present rates prohibit importation and also on materials used in American factories-raw materials in the sense that they are to be remanufactured.

I think that logical American industries should be moderately protected against cheaper foreign labor, and I believe in tariff for revenue. Changes proposed in the act of 1909: Paragraph 22, to read:

Extracts of nutgalls and of Persian berries, 1 cent per pound; extracts of quebracho, of chestnut wood, and of oak wood, three-eights of 1 cent per pound; extracts of hemlock bark, of sumac, and extracts and decoctions of logwood and other dye woods, extracts of barks and of woods other than dye woods, such as are commonly used for dyeing and tanning, and all extracts of vegetable origin suitable for dyeing, coloring, staining, or tanning, all the foregoing not containing alcohol, not medicinal, and not specially provided for in this act or in the first section of the act cited for amendment, one-eighth of 1 cent per pound.

My reasons for these changes are:

(1) The rates of duty specified in paragraph 22, Schedule A, act of 1909, are practically prohibitive on all tanning extracts except quebracho, preventing or greatly curtailing the importation of foreignmade extracts of foreign-grown woods, barks, acorns, and nuts which do not grow in this country, but which are valuable to and greatly

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

needed by our tanners. A reduction of the rate of duties would greatly increase the importation of these foreign extracts and thereby provide great revenue and help conserve the hemlock and oak bark of of the United States.

(2) Paragraph 22 is too complex in its specifications, causing unnecessary work for the collectors and appraisers. House bill 20182, paragraph 31, is much simpler. It would seem unnecessary for the collector or appraiser to have to determine whether an extract was made from the root or wood or bark or fruit of a tree.

(3) These reduced duties would hurt no one in the United States, except one or possibly two quebracho extract manufacturers, located in Connecticut and New York, and their business is too illogical to endure. It requires three or four tons of quebracho wood to produce one ton of quebracho extract. This quebracho wood grows in the interior of South America and has to be transported to New York and Connecticut if it is to be made into extract by these two factories. The freight on a ton of wood from South America to New York is as much as it is on a ton of extract. This freight is about $3.50 to $4 per ton. Consequently these factories are handicapped to the extent of $7 to $12 a ton of extract compared with the factories in South America. In addition to this handicap the American labor is 50 to 100 per cent higher than the South American labor. Obviously, therefore, the business is an illegal one and it is not fair to the American tanner to make him pay a high duty (amounting to $547,850.24 in 1912) to protect these two American factories.

These reduced duties would benefit many: First, the American tanning industry (comprising some 600 tanneries), than which industry there is none in the United States which requires such a large cash outlay, such a long process of manufacture, with as great risks of no profits and as little chance for a large profit. Second, the Government, by increased revenue. Third, the 20 or 30 chestnut extract manufacturers of the United States. They would be benefited by an increased consumption of and a greater demand for their chestnut extract. This increased consumption would be brought about by the fact that the greater the quantity of imported extracts that are used the greater the quantity of chestnut extracts used. One is not a substitute for the other, but together they are substitutes for oak and hemlock barks. The best proof of this contention is the fact that the Canadian tanners, who have free extracts of all kinds, and cheaper barks than the United States tanners, use large quantities of chestnut extract from the United States, which costs them more than it costs our tanners because the freight rates are higher. They use these large quantities of chestnut extract in spite of the fact that their quebracho extract costs them three-fourths cent per pound less than it costs the American tanners and their other imported extracts cost them from 15 to 30 per cent less. This proves conclusively that the imported extracts are used with chestnut extract and that if we increase the use of imported extracts we will increase the use of chestnut extract proportionately.

I have suggested three-eighths cent per pound on quebracho extract instead of a lower rate, because I think that just as much would be imported at three-eighths cent as at a lower rate, and the revenue derived would be greater.

78959°-VOL 1-13- -13

PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

I have suggested three-eighths cent per pound on chestnut wood and oak wood extracts instead of a lower rate merely to protect the American chestnut extract manufacturers against a dumping of Italian and Saxonian chestnut and oak extracts onto this market at times of depression in those countries. Such a condition might never arise, but inasmuch as no chestnut extract is imported into this country under ordinary conditions, and inasmuch as the American chestnut extract industry is a worthy one and very beneficial to the mountainous sections of our Southern States, where its factories are located, I think it should be protected against such a possible condition.

To show the necessity of these lower rates of duties, the apparent benefits to be derived from them by the American tanners, and the increased revenue they would furnish to the Government, I give below three tables.

(1) The quantity and value of domestic barks consumed in the United States in the years 1900 and 1909 (the Department of Agriculture informed me that no record has been kept since 1909) and the quantity and value of tanning extracts consumed in the United States in the years 1900 and 1909.

(2) The quantity and duties collected thereon of tanning extracts imported into the United States during the year ending June 30, 1909 (the last year under the Dingley tariff) and the year ending June 30, 1912.

(3) My estimate of the probable importations and revenues therefrom under the duties proposed by me in this brief for the year ending June 30, 1915, compared with the importations and the revenue therefrom for the year ending June 30, 1912, under the Payne-Aldrich bill.

TABLE 1.-Tanning materials consumed in the United States.

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PARAGRAPH 22-DYEING OR TANNING EXTRACTS.

Compared with 1900, the quantity consumed in 1909 of domestic barks decreased 36 per cent.

Compared with 1900, the quantity consumed in 1909 of domestic extracts increased 592 per cent.

Compared with 1900, the quantity consumed in 1909 of imported extracts increased 1,420 per cent.

This shows that imported extracts are absolutely necessary for the preservation of our tanning industry.

TABLE 2.-Duties collected on tanning extracts imported during years ending June 30, 1912, and June 30, 1909.

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Quantity imported, 1912, 25 per cent less than in 1909; duties collected, 1912, 5 per cent greater than in 1909; quantity quebracho, 1912, 25 per cent less than in 1909; duties on quebracho, 1912, 10 per cent greater than in 1909; quantity other extracts, 1912, 26 per cent less than in 1909; duties on other extracts, 1912, 31 per cent less than in 1909; quebracho in 1912, 90.66 per cent of total quantity and 91.24 per cent of total duty collected; quebracho in 1909, 90.49 per cent of total quantity and 86.70 per cent of total duty collected.

This proves that the higher rates charged under the Payne-Aldrich bill on tanning extracts prohibited the importation of some extracts and greatly restricted the importation of others. And, in the meantime, the chestnut extract manufacturing business of the United States has been poorer than ever before-a less active demand and with smaller profits.

TABLE 3.-Estimated importations for year ending June 15, 1915, of tanning extracts and revenue therefrom under rates proposed in this brief, compared with the importations and revenue for year ending June 30, 1912.

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