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We and other photographic manufacturers are now buying precision components abroad in order to compete. Thus we are exporting skilled jobs in what the Munitions Board has termed a critical production area. Products with a lower skilled labor content will be affected eventually, even material and overhead costs are really someone else's direct labor, generally that of suppliers. At present, however, the operations most severely damaged are the small ones which tend to specialize in limited product areas.
Exhibit I shows tariff reductions that have been made in photographic products in recent years, and those which would be permitted under the proposed bill extending the Trade Agreements Act :
Exhibit II shows the value of certain photographic products imported into the United States since 1954. Charts 1 and 2 at the end of this statement show similar information in graph form and illustrate the rapid growth of photographic imports. Note that imports of still cameras above $10 each from Japan in each of the past 3 years have been considerably more than double those of each preceding year :
8, 744 Photo lenses.....
2,356 Motion picture cameras...
871 Photographic films and p
2. 650 Photographic papers....
3. 868 Other products included in photographic categories..
2, 210 Total.
20, 699 Compare the above with the approximate value of Argus sales of 35 mm cameras.--
--- 10, 044
Argus is one of few manufacturers who can say that its major product (the C3 camera) is selling at a price lower than its price 8 years ago, in spite of steadily rising unit costs. We have recently introduced a new model of this C3 camera priced 5-percent below the 1949 price but including a Japanese light meter.
A few years ago 1 of the 2 manufacturers of camera shutters in this country filed an escape-clause action stating that without satisfactory protection its business would disappear. Relief was not granted. Today 90 percent of the shutters used in this country are purchased from abroad. Wollensak has lost its shutter business, including skilled workers and technicians who had 3 to 5 years of training. This resulted in the layoff of between 300 and 400 people in Rochester, and the company was forced to give up its shutter engineering and research along with the shutter production,
Up to 1957, there were 84 escape-clause actions instituted. The Tariff Commission made favorable recommendations in only 26 of these and in only 9 cases were the favorable recommendations approved by the President.
Let me tell you a little more about the type of foreign competition we are facing:
First, it is mechanized to practically the same degree that our industry is mechanized—more efficient production on our part is not the answer.
Secondly, this competition is subsidized by various devices of foreign governments (such as the income-tax reductions allowed Japanese manufacturers of products for export).
Thirdly, there are indications that many photographic products have been dumped on our market at prices even lower than Japanese cost. For further information on this, please see my testimony before the Ways and Means Committee of the House of Representatives, as reported on page 597 through 611 of the Hearing on Renewal of Trade Agreements Act (February 26, 1958).
Fourth, these competitors are also imitators. Let me show you (exhibit III) the Argus PreViewer, originally designed and produced in this country. Compare it with some imitations which have been coming in from Japan during the past 2 years. Not only is the design similar in appearance but many of the detailed manufacturing features are almost identical, and even the display box shows a great similarity to ours. In order to sell it, distributors of one of these viewers describe it as “identical to Argus."
Reciprocity in this industry is a myth. During the past 4 years 130,000 cameras now valued at $6.6 million have been imported from a market completely closed to us-East Germany. Many other countries effectively prevent the import of American cameras. Our export volume has been steadily decreasing. Our only substantial foreign market is in Canada.
While the Japanese can bring any photographic product into the American market in any quantity, Japan discriminates against importation of some important American photographic products in their own home market. One gets the impression that their policy may be to hold down to token levels, or even to prevent completely, the importation into Japan of American photographic products which would seriously compete with their domestic industry. They are nevertheless working with the backing and, according to the Japan Camera Trade News, the financial support of their own Government, to take over as completely as they can entire sections of our American home and export markets.
The same situation prevails in other producing countries. In France and Italy high duties and currency restrictions prevent us from being competitive; we can send only relatively small quantities to Great Britain under the British token import plan, administered in part by our own Department of Commerce. In Belgium we also face serious barriers. Yet on more than one occasion our United States negotiators have granted cuts in United States photographic duties in favor of Belgium while, with the formation of the Benelux Customs Union, we wound up with substantially increased duties in the Netherlands and Luxembourg.
Developments have shown that the reciprocal trade agreements program has become mainly a device to place the United States as nearly on a free-trade basis as possible. One major exception is the United States market for agricultural products, which is of great interest to many foreign producing conntries. Yet, instead of freely opening up our home markets to importation which would seriously compete with our own agriculture, we wisely, I think, safeguard them by duties and in some instances by severe quota limitations.
The photographic industry's peacetime skilled labor force, maintained at a satisfactory level, would be sufficient only to provide the essential nucleus of key workers for an expanded wartime production of photographic products as well as in the making of precision nonphotographic products which this industry is counted upon to produce (height finders and rangefinders in applications not suited to electronic equipment, fire-control devices, timers, proximity fuses, etc.).
If "reciprocal" trade is necessary to preserve world peace, then no price is too great to pay for it. If it should not wholly succeed in its purpose, however. whom will our country call on for essential photographic and optical products? World War II provided the impetus for the growth of the optical industry in Japan. It is ironic that we must suffer today to help develop and expand their industry. We should gravely question the wisdom of a procedure which results in transferring our strategically important industry and our critical skilled jobs to foreign countries.
In the interest of maintaining tariff reductions on a selective, gradual and moderate basis, we believe that safeguards should be imposed to prevent further reduction of tariffs which have already been reduced more than "moderately." We believe that more attention should be given to provisions for restoration of adequate tariffs where they are inadequate now, and to provisions for quotas in those segments of the industry where tariffs alone will not suffice. I know you will give these matters serious consideration.
Mr. DETWEILER. My name is Joseph Detweiler. I am employed by Sylvania Electric Products, Inc., as vice president and general manager of the Argus Cameras division and I am here on behalf of Argus.
Our organization is representative of the still camera industry in the United States. We make still cameras, slide and motion-picture projectors and we sell meters, viewers, and other photographic accessories.
We are not opposed in general to reciprocal trade as a principle, but we do object to the way it has been administered and we object specifically to H. R. 12591 because this could be damaging to us, to the photographic industry, to our 900 employees, to our suppliers and others who are indirectly involved, and this could also be damaging to the country, because our industry is one which is vital to the national defense.
We were the first American manufacturers of 35-millimeter cameras, but today there are hundreds of foreign 35-millimeter cameras being sold on this market. These come primarily from countries with standards of living considerably lower than that in the United States.
The wage rate in the photographic industry in Japan, for example, is about 10 percent of ours. The average wage of men employed there is about 25 cents an hour compared to $2.50 in our industry, in Ann Arbor, Mich. The wage rate of females employed in Japan in the photographic industry is about half of that, half of the 25 cents.
Yet we are forced to compete on an equal footing with this kind of competition. One way we can compete is to buy components abroad.
That we are doing, and in doing so, we are exporting skilled jobs in a critical producing area.
Would you please look at exhibit 1 in my statement, which shows the 1930 rate of duty on various major divisions of photographic equipment, how that rate has changed to the present day, and what further reductions would be possible under the provisions of H. R. 12591.
The category with which I am most concerned, personally, is the second category, still cameras valued at $10 or more, which has now been reduced 25 percent and could be reduced under 12591 to a total of 4334 percent less than the 1930 rate.
The other categories all could be reduced under the bill to an eren greater degree from the 1930 rate.
Now how does this affect us? Would you please look at exhibit 2 which shows the growth of imports in this industry!
The items again with which I am most concerned are shown there at the beginning of the exhibit, still cameras valued at more than $10 each and I hare shown the amounts coming in from various countries.
You will see that the major source of these imports are East Germany, West Germany, and Japan. Please note that the total imports from West Germanr in 1957 constituted $9,250,000, those from Japan constituted $6,037,000, but that in each of the last 3 years those imports from Japan had doubled. It doesn't take much figuring to me what can happen to our industry in a few more years of growth of imports at that rate.
Please corepare the figures at the bottom of the page showing the approximate value of Argus sales of 35-millimeter cameras in these