PARAGRAPH 474-PHOTOGRAPHIC PLATES. The import of films in the raw state is negligible at the present time, my firm being one of the largest importers; the imports for the year ending June 30, 1912, were $75,328, while the exports for the 10 months ending October, 1912, were $5,106,756. The Eastman Kodak Co. has $6,165,700 preferred 6 per cent cumulative stock, regularly paying dividends, and outstanding common stock in the amount of $19,512,300. On December 31, 1911, it had a surplus of $12,186,288, an increase of almost $2,000,000 over 1910, and a reserve for depreciation, etc., of $6,413,102, an increase of about one-half million over 1910; both figures are now on the increase. It had total assets on December 31, 1911, of $46,556,920, an increase of about $4,000,000 over 1910. Its dividends on the common stock started at the rate of 21 per cent per annum in 1902, the first year of its present organization, increasing each year up to the panic year of 1907, when 20 per cent was paid. They reached their climax in 1911, when 42 per cent was paid, and thus far in 1913 12 per cent has been declared; in 1912 approximately 40 per cent was paid. We import photographic and moving-picture films for the reason that we can not buy them in America. The Eastman Kodak Co. refuses point blank to sell us anything, because we will not carry their goods exclusively. Shall this powerful corporation be aided in the substantial monopoly of the photographic business of this country, which it now has, by a continuation of a tariff of 25 per cent on its principal product, furnishing in 1911 at least 50 per cent of its net profits of $11,649,263 (57.81 per cent applicable to dividends upon its common stock), out of which it paid in that year dividends of $8, 174,847, or 421 per cent on its common stock? Even in the panic year of 1907, when its control of the entire business was not as complete as it now is, its earnings showed 34.95 per cent applicable to the common stock of about $20,000,000. PHOTOGRAPHIC PLATES. The present duty of 25 per cent ad valorem on photographic plates under section 474 should be reduced to 10 per cent ad valorem. The situation in dry plates is very similar to that in films in this country, although the control of the Eastman Kodak Co. over plates is not as complete as over films, nor is their restrictive policy enforced as ruthlessly. There are two independent American factories making dry plates, the Cramer Dry Plate Co. and the Hammer Dry Plate Co., both of St. Louis, Mo., who together manufacture, estimatedly, about 20 per cent of the American output, the balance going to Eastman. We estimate the sale of the American-made dry plates in this country at $5,000,000 and the imports at less than $100,000; the Department of Commerce and Labor gives no separate figures as to the imports of dry plates. We append hereto a calculation based on 240 dozen 8 by 10 dry plates, which we use as a unit. From this calculation it will appear that, taking into consideration all the factors confronting the American producer (excluding the item of difference in cost of labor between here and abroad, which is a negligible percentage of the total cost), a duty not to exceed 6 per cent will equalize the duties paid by the American manufacturer upon the imported raw material used in the process of manufacture. We submit that a duty of 10 per cent ad valorem is amply sufficient to protect the American manufacturer and will compensate him for any difference in the cost of labor that may exist between the United States and abroad. In point of fact, the American manufacturer requires no protection, as photographic dry plates of American manufacture are sold at lower prices in the United States than those at which the European manufacturer sells them abroad. F. Ernest Cramer, an American manufacturer, on January 30, 1913, stated before this committee (Schedule N., Book No. 23, p. 4447) that it cost 53 cents a dozen to make a 5 by 7 plate in America, while English plates are sold in this country at 50 cents a dozen. Both of these statements are incorrect; all of the plates made in this country can be manufactured at less than 50 cents for a 5 by 7 size; they cost from 40 to 45 cents to manufacture; the ordinary net wholesale prices of plates in this country are approximately as follows for a 5 by 7 size: Stanley plate, $0.49; Standard, $0.58; Hammer, $0.55; Cramer plate, $0.56. My firm is the principal importer of English plates and our price is 58 cents a dozen for 5 by 7. No English plates are sold in this country at 50 cents a dozen for the 5 by 7 size. PARAGRAPH 474-PHOTOGRAPHIC PLATES. As soon as Mr. Cramer finished testifying, I went out to a retail store in Washington and bought a dozen American-made 5 by 7 plates for 55 cents and annex receipted bill. How could they be sold retail for 55 cents if the American cost of production were 53 cents? The statements of Mr. Cramer as to lantern-slide plates are likewise erroneous. He says, at page 4447 of the record: "The 31 by 4 lantern-slide plates, English make, are sold at 22 cents a dozen in this country, whereas it costs us about 27 cents a dozen to manufacture." This is not true. The English lantern-slide plate mentioned by Mr. Cramer is sold by us in America to large consumers for 27 cents a dozen, whereas Mr. Cramer sells the same plates for 25 cents a dozen and other American manufacturers sell them as low as 21 cents. Mr. Cramer and his family have been in the dry-plate business for over 30 years and were the pioneers in this country; it is ridiculous to suppose (as he stated before this committee) that the English makers can sell plates in this country at 6 per cent below Mr. Cramer's manufacturing cost, without putting him and the other manufacturing companies out of business. Yet Mr. Cramer has done a large and profitable business for over 30 years and is prospering to-day. We respectfully ask that the duty on dry plates be reduced from 25 per cent ad valorem to 10 per cent ad valorem, and that photographic films "not developed or exposed" be placed on the free list. Respectfully submitted. G. C. GENNERT. Calculation of the percentage of excess cost of production to American manufacturer due to duty and freight of imported materials, based upon a batch of 240 dozen 8 by 10 dry plates, a quantity formerly used as a unit and called an 'emulsion." 240 dozen plates at $2.40 per dozen, list, are worth..... Less 45 per cent discount... Net selling price.... $576.00 259. 20 316.80 This quantity requires 8 pounds of imported gelatin and 16 cases of 100 square feet each of imported glass, as there are 15 dozen 8 by 10 sheets of glass in a box of 100 square feet. The duty on 8 pounds of gelatin at 60 cents per pound, cost in Europe, at 15 cents per pound and 20 per cent ad valorem, is as follows: 8X15 cents=$1.20+20 per cent of $4.80=96 cents, total. $2.16 The duty on 16 cases of glass-1,600 square feet at 13 cents per pound (1,664 pounds net weight).......... 22.88 Total duty on imported material.. 25.04 Less saving to American manufacturer in freight as follows (freight on glass being much cheaper than freight on dry plates): Pounds. A 100-foot case of glass (15 dozen 8 by 10 sheets) weighs packed Resulting in a saving of freight to the American manufacturer of..... 5. 18 And making his duties, less his saving in freight, which is equal to about 6 per cent on the net selling price... 19.86 PARAGRAPH 474-PHOTOGRAPHIC PLATES. TESTIMONY OF F. ERNEST CRAMER, ON BEHALF OF THE G. CRAMER DRY PLATE CO., OF ST. LOUIS, MO. The witness was duly sworn by the chairman. Mr. CRAMER. Mr. Chairman and gentlemen of the committee, I am appearing in behalf of the photographic dry plate industry, an industry which is contributing considerable toward the revenues of the Government in the shape of duty on window glass, of which we import hundreds of thousands of boxes a year, on which the duty ranges from $1.10 up to $3.50 per case, and also on thousands of cases of gelatin, on which the duty averages about $40 a case. Notwithstanding the fact that neither one of these articles is made in this country, there was an increase of almost 50 per cent in the duty on window glass in the Payne-Aldrich bill as compared with the Wilson bill, and about 40 per cent on gelatin in the PayneAldrich bill as compared with the Wilson bill. However, we realize the fact that it requires a certain amount of revenue to run the Government, and we are willing to have the duty, although it is really exorbitant on these two articles, remain as it is, provided this committee will rectify an injustice which was done to us in having the duty on the finished product, on the dry plates, reduced from 40 per cent to 25 per cent, the result of which has been that English plates have been brought into this country in large quantities and are competing with American plates to a very large extent. Take the 5 by 7 size, which is the standard, as an example; they cost us about 53 cents a dozen to make. English plates a e sold here in this country at 50 cents a dozen. The 34 by 4 lantern slides, English make, are sold at 22 cents a dozen in this country, whereas it costs us about 27 cents a dozen to manufacture. You gentlemen can therefore readily appreciate the fact that we are placed at a marked disadvantage in trying to compete with foreign goods. All we ask is that the committee rectify this injustice which has been done us. I do not know that I have anything else to say, Mr. Chairman. I know that your time is valuable and I do not want to trespass. The CHAIRMAN. You have covered all these points in your brief? Mr. CRAMER. I will do so. How soon do you want to have the brief? The CHAIRMAN. To have it printed in the record-and it is better to have it printed in the record—you should file it by Saturday. If it is not printed in the record we are apt to overlook it. Mr. CRAMER. The only reason I am not prepared to file that brief now is because I want to get the exact amount of imports of the English plates, showing how they have increased since the PayneAldrich bill was enacted, and in order to do that I will have to go to New York and get the information right from the customshouse. The CHAIRMAN. Furnish it to the clerk of the committee by Saturday and it will go in the record. Mr. CRAMER. Yes, sir. I am very much obliged. PARAGRAPH 474-PHOTOGRAPHIC PLATES. Hon. OSCAR W. UNDERWOOD, Chairman, Committee on Ways and Means, NEW YORK, January 13, 1913. House of Representatives, Washington, D. C. DEAR SIR: Confirming the argument made by myself before your honorable committee yesterday afternoon, and in compliance with your request to file a brief embodying my statements to you, I respectfully submit the following facts bearing on the question of the duty levied by the United States Government on foreign dry plates, under the Payne-Aldrich tariff: Taking the 5 by 7 plate, which is the standard size, as an illustration, the figures show that the English plates of this size are being billed at a list price of 3 shillings, or 72 cents per dozen. From this the dealer receives a discount of 50 per cent, making the net price 36 cents per dozen. Adding to his the ad valorem duty of 25 per cent fixed by the present tariff bill, brings the price to the dealer at 45 cents per dozen, enabling him to sell these plates at 50 cents per dozen, whereas our actual cost on the same size is 53 cents per dozen, this being due to the fact that we are obliged to pay heavy duties on our raw materials, such as glass and gelatin, neither of which is made in this country, and due to the further fact that the wages paid in England amount to only 25 per cent of those which are paid in America for the same class of work. You can therefore readily appreciate the fact that the difference between the price at which 5 by 7 English plates are sold in this country, namely, 50 cents per dozen, and the price of 58 cents, which is our selling price, discriminates largely against the American manufacturer. As a further evidence of the inroads which are being made on our business by the foreign plates, I desire to submit the following figures, which I obtained this morning from the collector of customs in New York. You will note that same show a constant increase in the amount of English plates imported into this country during the last five years. Every dollar of sales represented by the foreign plate means just that much less revenue for the American manufacturers, who are supporting this Government by contributing largely to its tariff in the shape of duty on raw materials, corporation tax, and other items, and therefore claim your protection against goods of foreign manufacture. I tried this morning to find out the exact price at which the English plates were being imported into this country, but was unable to get this information from the appraiser here on the ground that this was confidential and that he could not impart it to me except by your directions. The importers here also refused to give me this information. I therefore immediately wired you asking for this authority, so as to enable me to embody an accurate statement of the importation of foreign plates in this brief. Up to the present time I have received no reply from you to this message, and therefore can not wait any longer in as much as you asked to have this information by to-morrow. However, I have every reason to believe that the information contained above is accurate. Mr. Higgins, the local appraiser, promised to write you, giving you the full data, which you will have doubtlessly received by the time this letter reaches you. The Canadian Government has established the following duty on dry plates, according to Schedule A, Item 659 of the Canadian tariff; 20 per cent on the English plates, which list at 72 cents per dozen in the 5 by 7 size and are billed at 50 per cent off to the dealer, making the total to the dealer 43 cents per dozen, whereas the American plates are billed at discounts of 35 and 10 per cent off the list price of $1.10 for the 5 by 7 size, making 65 cents, on which the Canadian importer is obliged to pay a duty of 30 per cent ad valorem, amounting to 19 cents, which, added to the price at which the plates are billed to him, brings the cost up to 84 cents per dozen, as compared with 43 cents, the price of the English plates, or almost twice as much. You can therefore see that the Canadian Government is protecting the English manufacturers PARAGRAPH 474-PHOTOGRAPHIC PLATES. as against the American manufacturers. In fact the difference in duty has practically killed the sale for American plates in Canada. In view of the facts stated above, and as a representative of the dry-plate interests in this country, I would respectfully suggest that the new tariff on dry plates be placed at 50 per cent ad valorem instead of 25 per cent as heretofore. Even at this rate we will still be at a disadvantage as compared with the English plate, but the difference will not be near as great as it is now. Submitting the above to your careful consideration and thanking you for the courtesy extended to me by your honorable committee, I remain, Respectfully yours, Hon. OSCAR W. UNDERWOOD, Chairman Committee on Ways and Means, F. ERNEST CRAMER. ST. LOUIS, MO., February 7, 1913. House of Representatives, Washington, D. C. DEAR SIR: Referring to the letter which I wrote you on January 31 from our New York office, and also my brief, which was prepared at the same time, I desire to say that I am just in receipt of information from Mr. F. A. Higgins, the appraiser at the port of New York, in which he advises me that the wholesale foreign market value of 7 by 5 photographic plates is 2s. 9d. per dozen less 40 and 5 per cent discount. This would make the net cost of these plates, after adding the 25 per cent ad valorem duty, amount to 47 cents per dozen to the importer, instead of 45 cents per dozen as I mentioned in my brief. The information which I embodied in my brief was based on the knowledge which was at my command at that time, and having now received the correct figures, I would respectfully ask that the change be made in my brief, so as to have the net price of the dealer show 47 cents per dozen on the 7 by 5 size instead of 45 cents. With the exception of this slight correction, I see no reason to make any other change in the brief which was mailed you on January 31. Yours, very truly, F. ERNEST CRAMER. TREASURY DEPARTMENT, The CHAIRMAN COMMITTEE ON WAYS AND MEANS, SIR: I beg to state that Mr. F. Ernest Cramer, vice president of the G. Cramer Dry Plate Co., St. Louis, Mo., called upon me to-day, stating that he had appeared before your committee on the 30th instant, and that he had been requested by the committee to ascertain for it the foreign market value of photographic dry plates, size 7 by 5 inches, and also the foreign market value of lantern slides. I explained to Mr. Cramer that under the practice and restrictions of this office I was unable to furnish him the foreign market value of these goods as imported through this office, but that the information would be sent direct to the committee for such use as it deems proper. I therefore have to advise that the present wholesale foreign market value of 7 by 5 photographic dry plates is 2 shillings 9 pence per dozen, less 40 and 5 per cent discount. These goods come from England. The foreign market value of lantern slides, also from England, is 1 shilling per dozen, with 40 and 24 per cent discount. Respectfully, F. A. HIGGINS, Appraiser. THE RAW FILM SUPPLY CO., NEW YORK, N. Y., CONCERNING TARIFF ON MOVING-PICTURE FILMS. The COMMITTEE ON WAYS AND MEANS, NEW YORK, N. Y., January 29, 1913. House of Representatives, Washington, D. C. GENTLEMEN: We would respectfully ask this committee to consider the question of the tariff on the importation of raw film used for the manufacture of moving pictures. As an importer of this article we pay a duty of 25 per cent on the value, and this amount we charge to all the manufacturers of moving-picture films who are buying the film they require from us. |