PARAGRAPH 571-CANTALOUPES.

a fashionable club for a price probably as high as $25-not because it was worth it, but because it was the only one to be had, and they would pay that price to get it. The average price, however, per crate for cantaloupes from that district is probably not to exceed $3 on the market where it is sold with a freight rate of possibly $1 to $1.20 against it.

Mr. NEEDHAM. How much does the grower get?

Mr. SLATTERY. It depends very much on the conditions some people handle the goods on as to how much they will receive.

I found on my trip to the Imperial Valley last summer that I had to pay $2.50 a crate f. o. b. Imperial Valley in order to get any cantaloupes at all, and I found also later on in the season that some of the growers did not receive anything. I did not happen to handle those.

Mr. DIXON. Do you know anything about any combination between the growers and the sellers in the Middle West?

Mr. SLATTERY. Between whom?

Mr. DIXON. Between the growers of the cantaloupes and the dealers in the Middle West. What you refer to is California?

Mr. SLATTERY. I do not know of any combination of the growers. I have never heard of any that I can recollect at the present time. They have associations in all sections where cantaloupes are grown. Such associations are a necessity in order to enable the individuals to ship collectively in carloads. That is an absolute necessity in order to get the advantage of the carload freight rate. Each individual grower could not ship alone. They have combinations of that character in all sections, practically, where cantaloupes are grown.

Mr. NEEDHAM. Do they have combinations in Indiana and associations in Indiana, the same as in California?

Mr. SLATTERY. I do not think they have them the same as in California; there are not so many grown there nor are they of the same character, and, besides, Indiana is a section where cantaloupes are grown under different conditions than in California. The California cantaloupes are grown entirely under irrigation, and a good cantaloupe can not be raised in a section where it rains during the time the cantaloupe is maturing, and in Indiana, unfortunately, they frequently get too much rain. If they have a dry season they have very good cantaloupes.

JOHN NIX & Co.,

WHOLESALE FRUIT AND PRODUCE COMMISSION MERCHANTS, 220-222 North State Street, Chicago, January 17, 1913.

To the COMMITTEE ON WAYS AND MEANS,

House of Representatives, Washington, D. C.

GENTLEMEN: The undersigned, James L. Slattery, respectfully states unto your honorable committee that he represents John Nix & Co., of New York and Chicago. That they are shippers and receivers of cantaloupes.

That they have contracted to handle cantaloupes grown at Bataques, Lower California, which is situated across the border line from the United States, in Mexico; that the cantaloupes are grown by an American company on land bought and improved by American capital, and cultivated under American supervision, using American skilled labor, and American-made packages and supplies, and the profits come to America.

That he has observed in a produce trade paper recently, to wit, the Kansas City Packer, of November 29, 1912, a notice that an effort would be made to have a duty placed on cantaloupes from Mexico coming into the United States.

PARAGRAPH 571-CANTALOUPES.

That there is no duty on cantaloupes under the present tariff, nor to the best of my information has there ever been any duty on them heretofore.

I respectfully call to the attention of your honorable committee that if a duty were levied upon cantaloupes coming into the United States from Mexico it would not increase the revenue of the United States, but would probibit the importation of these cantaloupes and thus be a great injustice to the American company and capital engaged in growing these cantaloupes as well as to the consumer.

That a duty of this character would tend to increase the high cost of living, notwithstanding that the public are clamoring for a reduction.

That a duty on cantaloupes would be in violation of the platform adopted by the political party which was successful at the last general election, and would therefore not meet with the approval of a vast majority of the citizens of these United States. That it is a matter of general information that the cantaloupe industry in the Imperial Valley, Cal., is controlled by an organization or combination, and that the duty on cantaloupes from Mexico into the United States would tend to foster a monopoly and encourage the creation of organizations in restraint of trade engaged in interstate

commerce.

For these and many other reasons which might be cited, your humble petitioner begs that Schedule G of tariff act of 1909 will not be amended so as to impose a duty on cantaloupes coming into the United States.

Respectfully submitted.

PARAGRAPH 572.

JAMES L. SLATTERY.

Fruit plants, tropical and semitropical, for the purpose of propagation or cultivation.

PARAGRAPH 573.

Furs, undressed.

PARAGRAPH 574.

Fur skin of all kinds not dressed in any manner and not specially provided for in this section.

PARAGRAPH 575.

Gambier.

PARAGRAPH 576.

Glass enamel, white, for watch and clock dials. PARAGRAPH 577.

Glass plates or disks, rough-cut or unwrought, for use in the manufacture of optical instruments, spectacles, and eyeglasses, and suitable only for such use: Provided, however, That such disks exceeding eight inches in diameter may be polished sufficiently to enable the character of the glass to be determined.

PARAGRAPH 578.

Grasses and fibers: Istle or Tampico fiber, jute, jute butts, manila, sisal grass, sunn, and all other textile grasses or fibrous vegetable substances, not dressed or manufactured in any manner, and not specially provided for in this section.

PARAGRAPH 579.

Gold beaters' molds and gold beaters' skins.

PARAGRAPH 580-GREASES AND OILS.

PARAGRAPH 580.

Grease, fats, vegetable tallow, and oils (excepting fish oils), such as are commonly used in soap making or in wire drawing, or for stuffing or dressing leather, and which are fit only for such uses, and not specially provided for in this section.

GREASES AND OILS.

TESTIMONY OF C. P. GULICK, TREASURER OF THE NATIONAL RED OIL & SOAP CO., OF NEWARK, N. J.

The witness was duly sworn by the chairman.

Mr. GULICK. I have already submitted a brief on the subject, gentlemen, but I think there may be some further explanations necessary. I invite your attention to paragraph 580 of the free list:

Grease, fats, vegetable tallow, and oils (excepting fish oils), such as are commonly used in soap making or in wire drawing, or for stuffing or dressing leather, and which are fit only for such uses, and not specially provided for in this section.

We are manufacturers of sulphonated oils of all kinds, but are particularly interested in sulphonated oils for the leather trade. During the past few years the demand for sulphonated oils has increased several fold because of their peculiar adaptability to the tanning industry. The best oils for tanning purposes are those made from cod, fish, etc. There is practically an unlimited market for these sulphonated oils, but the American manufacturer is working under a most severe handicap in the form of an improper tariff. At the present time, under paragraph 40 of the act of 1909, we are obliged to pay a duty of 8 cents per gallon on all fish oils; while the sulphonated fish oils are coming into our ports in large quantities under the free list, paragraph 580.

The largest importations are coming from England where there is no tax levied on these raw oils. England moreover enjoys the benefits of cheaper labor and chemicals than we do, although it is not our intention to make a point of this. There are a large number of manufacturers in the United States who are struggling to meet this foreign competition, but our high duty on these raw oils practically guarantees the business to our foreign competitors. I can not believe it is the intention of our Government to foster such a manifestly unfair situation as this.

On that point I wish to say that the sulphonated oil business is conducted along highly competitive lines. There is a large number of manufacturers in the United States who are making and selling sulphonated oils. The prices, in view of the duty on sulphonated oils, could not be raised to the purchaser, for the simple reason that sulphonated oil must bear a certain relation to the raw oil of which it is made. Furthermore, competition would keep the level down still further, and there is no possibility of a monopoly being created. We believe that it was not the intention of the Payne Act of 1909 to protect this situation: in other words, to protect the foreign manufacturer to the disadvantage of the American manufacturer.

During the year 1911 the Government made an unsuccessful attempt to levy duty on one of these imported products through the customs appraiser at Boston. The Government sought to levy a 30 per cent ad valorem duty under paragraph 32, as a grease "used in

PARAGRAPH 580-GREASES AND OILS.

processes of softening, dyeing, and finishing." The importer, however, maintained his case and continued to bring the commodity in free under paragraph 580. The appraiser at Boston, after investigating the product, reported as follows:

"The analysis of the substance shows it to be a sulphonated oil containing, about, moisture 17 per cent, mineral oil 27 per cent, free fatty acids 45 per cent, degras former 5 per cent, and sulphuric oxide 3 per cent. The odor indicates the presence of cod oil, and would point to a sulphonated cod or fish oil."

This and similar products made abroad compete very seriously with American manufacturers of sulphonated cod and fish oils, and the Government is rightly entitled to any revenue that might accrue from import tax on such commodities.

Here is a point I would like to change in my brief. I state in the brief that during the year 1911, but I mean in one year starting at a point in 1911 and ending in 1912. We have estimated that one of these products alone was imported during the year 1911 to the extent of about 20,000 barrels. Averaging about 400 pounds per barrel, this would mean a total of 8,000,000 pounds, which should have borne a duty correlative with that on raw cod, or fish oils, which, expressed on a pound basis of 1 cent per pound, would have resulted in a revenue to the Government of $80,000. As these oils weigh approximately 8 pounds to the gallon, but are always sold on a basis of pounds, we would suggest that a specific duty of 1 cent per pound be placed on them, which would make their duty commensurate with that on cod, whale, and other fish oils.

We are not against free trade. In fact, free trade would be entirely satisfactoty as far as our business is concerned, but when our tariff law discriminates so flagrantly against the American manufacturers in favor of our foreign competitors, we believe we are entirely justified in asking for this consideration, which we now pray for at your hands. In that connection I want to say this-that we are not asking for protection. I do not want to be misunderstood. But we are asking that our Government shall not protect the English, the French, or the German manufacturer. We are not asking for a duty on our finished product to protect us against any conditions of labor or conditions of improved manufacture abroad. We are perfectly willing to cope with that problem. We are simply asking that a tariff be put on sulphonated oils commensurate with that on the raw oils which now bear a tariff

Mr. FORDNEY (interposing). Why do you want that, then, if you do not want protection?

Mr. GULICK. I would just as leave have free trade absolutely, but my raw materials now bear a specific duty of 8 cents per gallon. Mr. HILL. And you do not want to start with that handicap? Mr. GULICK. No, sir. I am perfectly willing to meet the proposition on a free trade basis.

Mr. FORDNEY. Do I understand there is a duty on your raw material?

Mr. GULICK. Yes, sir; a specific duty of 8 cents per gallon.
Mr. FORDNEY. And free trade on your finished product?

Mr. GULICK. Yes, sir; absolutely. That is my position. I do not believe that it was the intention of the act of 1909 to bring about such

PARAGRAPH 580-GREASES AND OILS.

a condition as this, but that came about through a very simple error; the fact that these oils have come into almost universal use since that act was adopted changes the entire complexion of the case.

Mr. HILL. There was really no such oil made then?

Mr. GULICK. It was being exploited at that time simply in an experimental way. From a revenue standpoint the present law has the tendency of diverting raw oils to foreign countries where there are no duties in force, where they are then manufactured into finished products and shipped to the United States free of duty, thereby paying no revenue to our Government and seriously damaging our home industry. I beg to submit to you gentlemen on that point that oil can be taken to England, where there is no duty on it, manufactured into a finished product, and simply because the form of the oil is changed, it can be shipped into the United States and evade the duty. It absolutely defeats the Democratic principle of revenue, because the raw material, instead of coming into this country and paying a duty, goes to England, and it defeats the Republican priciple of protection. Therefore, I submit, we are entitled to consideration on that account. I have a cablegram in my hands from England, dated January 25, quoting the price on cod oil in England. The market value there to-day is 8 cents per gallon lower than the American market price, and that gives the English manufacturers an advantage of 8 cents per gallon, or on a pound basis 1 cent per pound. Now, we ask for a specific duty on a pound basis on this commodity for the simple reason that it is sold that way. We would, therefore, ask that a separate paragraph be drafted into the proposed tariff bill providing that "All sulphonated, soluble, or emulsifiable oils and greases, compounds or mixtures of same, not specially provided for in this act, 1 cent per pound." My reason for asking that is because of the clause providing for a duty, an ad valorem duty, on turkey red oils and alizarine assistants, which are related to this class of goods, although manufactured from a different base. We believe a specific tax would be preferable, as it would then neutralize the specific tax on seal, herring, whale, and other fish oils. It would also simplify the appraisement, as it is very difficult to recognize the fundamental raw oils in a sulphonated oil, except by a very careful chemical analysis.

In closing I beg to say that we would be very willing to have the duty remain off these products, providing our raw oils, now taxed under paragraph 40, were allowed free entry, but at all events we trust you will give this matter the consideration it deserves, and at least levy a tax commensurate with that on raw materials.

Mr. HARRISON. What sort of an ad valorem equivalent would 1 cent a pound be on the soluble oils and greases?

Mr. GULICK. The ad valorem equivalent?

Mr. HARRISON. Yes. It is pretty hard to answer, I suppose, but the rate we selected was 15 per cent for our basket clause.

Mr. GULICK. You are speaking of the clause relating to sulphonated, soluble or emulsifiable oils, etc.?

Mr. HARRISON. That is one of them, but there is a clause covering those not provided for. Would it raise the duty to adopt the rate you propose? It is pretty hard to answer, I suppose.