Senator LA FOLLETTE. What is the total amount of the capital stock of your plant? Mr. BARBOUR. The capital employed is somewhere in the neighborhood of two million. Senator LA FOLLETTE. In your own plant? Mr. BARBOUR. In my own plant. Senator LA FOLLETTE. How is that divided as between preferred and common? Mr. BARBOUR. It is common stock. It is closely held by my own family. Senator LA FOLLETTE. What dividends did you pay on that stock in the year 1918? Mr. BARBOUR. I do not know whether we paid a dividend in 1918 or not. Senator LA FOLLETTE. I just selected 1918 as an example. Mr. BARBOUR. I presume we have paid somewhere between 9 and 10 per cent on an average through the last three or four years. Senator LA FOLLETTE. Running from the period affected by the war? Mr. BARBOUR. During the period of the war we did not pay much of anything in dividends. We did not know what was going to happen. Senator LA FOLLETTE. What did you pay last year-1920? Mr. BARBOUR. In 1920 we paid, I think, a dividend that was about equal to 124 per cent; that is, 10 per cent and an extra dividend of 24 per cent. Senator LA FOLLETTE. So that it was about 12 per cent? Mr. BARBOUR. Yes. Senator LA FOLLETTE. Do you know what you are going to pay this year? Mr. BARBOUR. No, sir; we have always worked on a conservative basis. Senator CALDER. Will you make any money this year, Mr. Barbour? Mr. BARBOUR. I question whether we will. Of course, we are doing everything we can to work economically and break even, if possible. Senator CALDER. I will ask that the brief of this concern be printed in the record. The CHAIRMAN. Whose brief, Senator Calder? Senator CALDER. His brief. The CHAIRMAN. That has been ordered. (The brief submitted by Mr. Barbour is printed in full, as follows:) PETITION FOR AMENDMENTS TO SCHEDULE 10, PARAGRAPH 1003, Hon. BOIES PENROSE, DECEMBER 7, 1921. Chairman Finance Committee, United States Senate. HONORED SIR: We herewith beg to submit the identical brief which was submitted to the Ways and Means Committee in January of this year. What was stated then in this brief was the combined consensus of opinion of practically all the jute manufacturers of this country. The conditions to-day do not materially affect anything therein stated. Paragraph 1003 now reads as follows: "Jute yarns or roving, single, coarser than twenty-pound, 2 cents per pound; twenty-pound up to but not including ten-pound, 4 cents per pound; ten-pound up to but not including five-pound, 54 cents per pound; five-pound and finer, 9 cents per pound; jute sliver, 14 cents per pound; twist, twine, and cordage, composed of two or more jute yarns or rovings twisted together, the size of the single yarn or roving of which is coarser than twenty-pound, 34 cents per pound; twenty-pound up to but not including ten-pound, 5 cents per pound; ten pound up to but not including fivepound, 6 cents per pound; five-pound and finer, 11 cents per pound." In conformity with our brief we earnestly request that this paragraph be changed to read as follows: "Jute yarns or roving, single, coarser than twenty-pound, 3 cents per pound: twenty-pound up to but not including ten-pound, 5 cents per pound; ten-pound up to but not including six-pound, 7 cents per pound; six-pound up to but not including four-pound, 9 cents per pound; four-pound and finer, 11 cents per pound; jute sliver, 2 cents per pound: twist, twine, and cordage, composed of two or more jute varus or rovings twisted together, the size of the single yarn or roving of which is coarser than twenty-pound, 5 cents per pound; twenty-pound up to but not including tenpound, 7 cents per pound; ten-pound up to but not including six-pound, 9 cents per pound; six-pound up to but not including four-pound, 11 cents per pound; fourpound and finer, 14 cents per pound." You will see that the proposed bill reduces the number of our groupings from five to four, as well as the specific rates of duty in each group. In our brief the groupings were reduced to the minimum with a view to simplification and any further reduction would tend to great inequalities and make the rates not only inadequate but out of all proportion. For example, take the third group in paragraph 1603 which now goes from tenpound up to but not including five-pound, a range of five full numbers. This is too great a range, as the cost of production in the finer sizes goes up in far greater proportion than the difference of cost in the coarser sizes, and the finer the numb er the greater the difference in the cost, one number with another. We therefore strongly urge that you consider no less than five groupings as proposed in our original brief. We regard the rates in the proposed bill as inadequate and request that you give us the protection which would be afforded by the original rates recommended by us and that the groupings be reinstated in conformity with our original brief. Respectfully submitted. Allentown Spinning Co., Allentown, Pa.; American Manufacturing Co.. BRIEF WITH REFERENCE TO SCHEDULE J, PARAGRAPHS 267, 273, 279, AND 284 AND FREE LIST, PARAGRAPH 497. JUTE AND MANUFACTURES OF. JANUARY 19, 1921. COMMITTEE ON WAYS AND MEANS, House of Representatives. GENTLEMEN: We, the undersigned jute yarn and twine manufacturers of the United States, herein present for your favorable consideration our unanimous suggestions for a protective tariff on the manufactures of jute. Our idea of a protective tariff is one that merely equalizes the difference in wages and costs of production between the United States and foreign countries irrespective of the cost of raw material. Experience has taught us that within reasonable limits the variation of wages in this country and abroad is in substantially the same ratio. The difference in cost of manufacture varies with the time and amount of labor necessary for manufacture. It requires more time and labor to produce a pound of fine yarn or twine than a coarse one, directly in proportion to its size. We, therefore. require a straight specific rate of tariff to cover this difference in wages and cost of production as an ad valorem tariff would be based, not only upon wages, etc., but also upon the cost of raw material, which should not be considered in the question of equalizing the difference in wages and cost of production. We believe the changes suggested hereafter afford only the proper and necessary protection for our industry The proposed change in paragraph 267 is from an ad valorem rate of duty to a specific basis. Al 1. Raw jute is grown only in India, with the exception of a very small percentage in China. It is the cheapest fiber known. The manufactured products are necessary, innumerable, and indispensable for the commerce of the United States. Every package of medium bulk is tied up with jute twine. The post office alone uses approximately 2,500,000 pounds annually. Every bale is covered with jute burlap. We estimate jute yarn is the foundation of 80 per cent of the carpets, rugs, oilcloths, and linoleums manufactured in this country. It is used by the electrical companies as insulation for all their cables and by fuse manufacturers to protect fuse. Normally 300.000 pounds of jute twines are used daily in the distribution of merchandise in this country. 2. Calcutta, India, and Dundee, Scotland, are the sources of competition for the manufacturers in this country. The wages to-day in Calcutta average $1.70 per week, and in one mill employing 4,306 hands the pay of the white superintendent and his assistants is greater than the total pay roll of the native operatives. The mills run 13 hours per day and, allowing for the greater efficiency of American labor, it only requires one and one-half hand in India to equal the production of one operative in the United States. We have already experienced new competition in yarns from Calcutta, whose principal jute manufacture hitherto has been burlap. During the last four years, due to war conditions, the jute mills in India have increased 30 per cent, so that to-day they have a capacity for the manufacture of burlap that would more than supply the world and are now running short time. As yarn is the foundation of burlap, under normal conditions they will naturally turn to increasing very materially their exports of yarn and twine. 3. Dundee has up to the present time been the principal source of competition. Their wages and cost of production are about one-half those of the United States, but if a duty is made to equalize the Indian cost of production it will automatically take care of competition from Dundee. 4. The term "pound" and not "lea" is the correct one to use for describing the size of jute yarn. The term "lea" is only used in the flax and hemp spinning trade, and, although it is perfectly practical to convert the jute term describing the size of yarn into the flax term, it is unusual. We therefore suggest that the tariff, in so far as it embraces jute yarns and twines in Schedule J. should be worded in the accepted terms and trade language. 5. Paragraph 267 now reads: "Single yarns made of jute, not finer than five lea or number, 15 per centum ad valorem; if finer than five lea or number and yarns made of jute not otherwise specially provided for in this section, 20 per centum ad valorem." In place of paragraph 267 we propose a straight specific tariff as follows: Jute sliver, 2 cents per pound net weight; single yarns or roving made of jute, the size of which is 4 pounds and finer, 11 cents per pound net weight; over 4 pounds to and including 6 pounds, 9 cents per pound net weight; over 6 pounds to and including 10 pounds, 7 cents per pound net weight; over 10 pounds to and including 20 pounds. 5 cents per pound net weight; coarser than 20 pounds, 3 cents per pound net weight; twines, cordage, or twist of two or more plies made of jute yarn or roving, the size of the individual plies of which is 4 pounds and finer, 14 cents per pound net weight; over 4 pounds to and including 6 pounds, 11 cents per pound net weight; over 6 pounds to and including 10 pounds. 9 cents per pound net weight; over 10 pounds to and including 20 pounds, 7 cents per pound net weight; coarser than 20 pounds, 5 cents per pound net weight. Paragraph 273 now reads: 'Carpets, carpeting, mats, and rugs made of flax, hemp, jute, or other vegetable fiber (except cotton), 30 per centum ad valorem." In place of this we propose a straight specific tariff, as follows: Carpets, carpeting, mats, and rugs made of flax, hemp, jute, or other vegetable fiber (except cotton), 12 cents per pound. Paragraph 279 now reads: "Plain woven fabrics of single jute yarns, by whatever name known, bleached, dyed, colored, stained, painted, printed, or rendered noninflammable by any process, 10 per centum ad valorem." In place of this wording, we propose the following: "Plain woven fabrics of single jute yarn, by whatever name known (except all fabrics known or used as carpets, carpeting, mats, and rugs), bleached, dyed, colored, stained, painted, printed, or rendered noninflammable by any process, 10 per centum ad valorem." Paragraph 284 now reading "All woven articles, finished or unfinished, and all manufactures of flax, hemp, ramie, or other vegetable fiber, or of which these sub stances, or any of them, is the component material of chief value, not specially provided for in this section, 35 per centum ad valorem," should be retained as it is. Paragraph 497 (free list) reading "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," should be retained as it is. 6. The consumption of jute by the manufacturers in this country amounts to 220,000,000 pounds annually. A comparison between the above specific rates and the ad valorem rates ruling in the past is not possible unless in each instance the value of the product is known or taken at one fixed time. The price of the basic size (14-pound yarn) has varied all the way from 10 to 35 cents per pound, and if the comparison is based on an average of these prices it would not quite equal 25 per cent ad valorem duty. 7. The decline in foreign exchange has worked to our disadvantage, but we believe that in due time this will right itself, and therefore need not be considered by your committee. Capital invested in the United States.. $60, 000, 000 10,000 Rates of wages, common labor, per day: India, 20 cents; Dundee, $1.50; United States, $3. Skilled trades in same proportion. The manufactures of jute produced in this country were found to be essential during the war. Without the ma hinery and organizations existing when war commenced it would have been much more difficult, if not impossible, to move supplies in and from this country. Allentown Spinning Co., Allentown, Pa., J. E. Barbour, president; Amer- The CHAIRMAN. The committee will now proceed to hear from Mr. Percy D. Elliott, representing the Granite Linen Co., Wortendyke, N. J. Is Mr. Elliott present? If not, the committee will hear Mr. C. H. Carlson, representing the Falconer Towel Co., Falconer, N. Y. There appears to be no response. Mr. A. R. Foster, representing the Niagara Textile Co., Lockport, N. Y. Is Mr. Foster here? Mr. FOSTER. Yes. The CHAIRMAN. Mr. Foster, we shall be glad to hear your views. STATEMENT OF MR. A. R. FOSTER, REPRESENTING THE NIAGARA TEXTILE CO., LOCKPORT, N. Y. The CHAIRMAN. What is your occupation, Mr. Foster? Mr. FOSTER. I am secretary-treasurer of the Niagara Textile Co. The CHAIRMAN. You are located where ? Mr. FOSTER. Lockport, N. Y. The CHAIRMAN. What product do you chiefly turn out? Mr. FOSTER. We manufacture towels, napkins, etc., for home use, hotel use, railroad use, and for institutions, etc. The CHAIRMAN. How many men do you employ? Mr. FOSTER. We employ at the present time about 225, sir. The CHAIRMAN. That is the maximum number? The CHAIRMAN. Will you proceed to state your views to the committee? Mr. FOSTER. I have a very short statement. Senator LA FOLLETTE. How much is that below normal? Mr. FOSTER. It is pretty hard to say how much normal would be. We speeded up during the war on account of special conditions. Senator LA FOLLETTE. How old an institution are you? Mr. FOSTER. Twenty years. Senator LA FOLLETTE. About how many men did you employ in 1913? Mr. FOSTER. Probably 150 or 175. The CHAIRMAN. Are you running on full time now? M. FOSTER. We are running on a 50-hour schedule. Mr. FOSTER. I have a very short brief that I would like to file. I would like to bring some points to your attention. The CHAIRMAN. If you will file the brief and bring the attention of the committee to any matter particularly, it will receive careful consideration. Mr. FOSTER. I shall be pleased to do that. The CHAIRMAN. You may go on. Mr. FOSTER. This regards schedule 10 particularly, although we are interested in 9 as well. It covers paragraphs 1004, 1009, and 1013. To give a concrete example of how the new rates on linen yarns would affect us, we cite 14's bleached weft yarn, assuming that the American valuation at the port of entry has been determined at 48 cents per pound, which is about to-day's price. The Fordney bill calls for the following in the way of duties: 8 cents plus 3 cents plus 5 cents, a total of 16 cents per pound, which is a 333 per cent duty. However, if the price of this yarn receded to the prewar price of 20 cents per pound, the rate of duty under the Fordney bill would be 80 per cent. What we believe would be for the best interests of the country is to give merchandise at a reasonable price, so that it will be used in large quantities and also produce as much revenue as possible. We believe that both the raw material, as we call it, that is, linen yarns, and the woven fabric made from these yarns, should be both on the same basis; that is, ad valorem, not specific on one and ad valorem on the other. Senator WATSON. What basis? What do you recommend? Mr. FOSTER. We prefer to have an ad valorem duty, and not to have the yarns on one basis as a specific, as put in, and the finished product on the ad valorem basis. Senator WATSON. An ad valorem duty of how much? Mr. FOSTER. We want a differential of 25 per cent as between the gray yarn, the raw product, as we call it, and the finished product. Senator LA FOLLETTE. You do not manufacture the yarns? Mr. FOSTER. No, sir; we import the gray yarn. What we want is a reasonable protection, so that our mills can compete with foreign labor. We should have a differential of not less than 25 per cent. At the present time all linen towels and napkins are being brought into this country at very near the prices that we can make similar |