Senator KERR. Page 6? Mr. WILKINSON. Page 6 of this booklet, sir, where we have charted the decline. The decline in worsted spindles is now 63 percent instead of the 50 percent there indicated. Senator KERR. And the first one instead of 45 is what? Mr. WILKINSON. Fifty-one percent. Senator KERR. The other is 63? Mr. WILKINSON. The other is 63 percent, and in woolen spindles the decline instead of 53 percent is 57 percent. The decline in worsted combs is now 59 percent instead of 44 percent. Similarly, the production chart on page 7 we find that the figure for 1957 is 29 million linear yards, which represents a production drop of 46 percent instead of the indicated 41 percent. The import figures are given there. I shall not take the time now and impose on the committee by indicating the corrections, but with relation to the question that were raised earlier this morning, I would like to indicate that while our industry has been contracting, the Japanese, one of the newest arrivals and most severe arrivals on the scene have been expanding their physical plant. I will give you the data from our bulletin, which has as its source the Commonwealth Economic Committee, and I will start with the year 1952. Senator KERR. You are going back now to your statement? Mr. WILKINSON. No, sir; I am speaking extemporaneously. Japan in 1952 had 19,775 broadlooms. By 1955 that figure had increased to 24,853 broadlooms. The figure that we have for 1957 is approximately 27,000 broadlooms. The disparity in that figure and figures put in the record earlier this morning I think may be attributed to the fact that in these figures we exclude those looms occupied on the manufacture of carpets, carpet looms. These are the apparel cloth looms. I shall not at this time read in the additional corrections and updating of "Danger Ahead," but I would like to deal with this question of synthetic competition that is constantly brought up when one speaks of the contracting wool textile industry. Some import interests and clothing manufacturers constantly throw this out as the explanation of our difficulty. As an explanation, we think it is quite inadequate. In the first place, there was an increase over the past 10 years of more than 50 million pounds in the use of manmade staple fiber and tow in the spinning of yarns on the woolen and worsted systems for other than carpets and rugs. Senator KERR. Is that pounds of woolen fiber? Mr. WILKINSON. This is the pounds of synthetic fiber which our mills employed. Senator KERR. I thought you said there had been a decrease of 50 million pounds. What was that? Mr. WILKINSON. No; there has been an increase. Senator KERR. An increase? Mr. WILKINSON. There has been an increase over the past 10 years of more than 50 million pounds in the use of man-made staple fiber and tow in the spinning of yarns on the woolen and worsted systems for other than carpet and rugs. Senator CARLSON. Can you give us the figures on carpets? Mr. WILKINSON. I do not have the carpet and rug data, sir. Secondly, this explanation lacks corroboration in the poor business | conditions among the weavers of man-made fiber and silk broadwoven fabrics. The output of broad-woven fabrics wholly or chiefly by weight of man-made and silk fiber or filament yarns during 1956 | was below that of the 7 of the 10 preceding years, and was 13 percent below that of 1950. During the first 9 months of 1957 the rate of output was below that of 1956. Third, in addition to glossing over imports putting all the blame on synthetics ignores numerous other factors such as the effect on wool prices of Government buying and statements of stockpiling during the Korean war. It ignores revolutions in the manufacturing technology, the relocation of the industry and the changes in American living habits. Mr. Stevens, who is your next witness, is involved with all these fibers, and will speak with much more direct authority than I. This booklet, Danger Ahead, involves to a large degree, matters which can be measured and plotted on the basis of past and existing records. What cannot be measured or plotted is the attitudes created in the minds of our members as they listen to the endless propaganda issuing from high Government officials and the various agencies of Government supporting this proposed extension and as they witness its progress through the Congress. From my day-to-day contacts with these people I can assure you the effect is one of deep discouragement leading to the frustration and disillusionment that breeds stagnation or what is worse-liquidation. Until and unless Congress demonstrates a determination to reassert its responsibility in formulation and administration of our foreign trade policy, I predict without hesitation that this trend in liquidation will continue, blighting employment, tax revenues, and in many communities, the main sustaining industry. It is true our association has stood in opposition to this trade agreements program from the start. We have had good reason. We have been keenly sensitive to the inroads foreign nations could make upon our domestic market, practically our sole market, once freed of the preoccupation with preparing for or waging war, or the preoccupation with the filling of the vast vacuum for wool textiles created by the destruction of wars; wars which incidentally, were not averted by this program despite its early supporting slogan, "World Peace Through World Trade." Attempts have been made to discredit our position by contrasting it with the support for the program that has come from so-called heavy industries; but now we see the basic fallacy of this program becoming manifest elsewhere. Revere Copper & Brass, Inc., was reported in the Wall Street Journal on May 12 to be cutting prices "because of imports at quotations sharply below United States prices." Mr. C. A. Macfie, president of the company, is quoted: Labor rates in our mills are 3 to 8 times higher than those of the foreign manufacturerers. This poses a real threat to the domestic copper and brass industry Similarly, Roger M. Blough, chairman of the board, United States. Steel Corp., has reported sharp increases in steel-barbed-wire imports at $40 per ton below comparable domestic wire. Mr. Blough indicated that had this imported barbed wire some 64,000 tons-been made here it would have represented about $6 million additional in American steelworkers' pay envelopes. In short, we would have had the wire, the pay, and the taxes and other collateral benefits, and the employed steelworkers would have been better customers for our industry just as our workers are better customers for the consumer products of these heavy industries— if employed. The General Electric Co. is reported to have come to the belief that rising imports of heavy electrical-power equipment pose a threat to national security and should be curbed under the national defense clause. Gentlemen, we suggest these are but portents of more to come if we continue to expand the paradox of our domestic and foreign trade policies. Further, we reject the proposition that the resolution of this paradox lies in so-called "trade adjustment" proposals which encompass some form of Government aid in retraining workers, in relocating industries, in modernizing plants or methods, or even direct subsidies. Such largesse by Government is not only in many ways undesirable and impracticable but also would be self-defeating. They serve only to highlight the basic contradition in our trade policies. Who gains, for example, if we say to the world, "send us your wool textiles," cut our tariffs for this purpose, and then in turn subsidize our domestic wool textile industry so as not to be displaced by imports in our own market? Are we to believe our foreign friends will not see through, will not resent, this kind of sham? Of course they will. They have, in fact. For example, there was immediate reaction to the administration's minerals subsidy plan-both abroad and at home. Said Britain's Mining Journal: If the scheme offers a subsidy which is a potential threat to the trade of another country, it will almost certainly be a contravention of the General Agreement on Trade and Tariffs (GATT). At home, R. S. Reynolds, Jr., president of Reynolds Metals Co., asserted the metal-subsidy proposal discriminated against aluminum. Now, we understand, aluminum is to be included if the metals-subsidy plan goes through. We must protect competitive American industries from unfair lowwage competition from abroad by more realistic tariff policies. If we continue to make insincere gestures toward free trade, in a world not ready for free trade, cutting tariffs and then subsidizing affected industries, we will be forced to abandon our American enterprise system. The United States has twice served as the arsenal of democracy. If we are to serve the cause of a just and lasting peace we must preserve our strength here. We cannot do this by exporting our essential industries. 27629-58-pt. 2—18 Further, should we socialize these industries to preserve them, has not the battle already been lost? General objections: This bill has not been clearly represented. It is referred to as a "5 year" extension. Actually, if I understand the language, the tariff reducing authority it would extend can be used up in 3 years. What then? If the past be prelude, then you will be confronted with demands for additional tariff-cutting authority prior to the end of the 5-year period when the bait is all gone. On the other hand, should world events defer the immediate utilization of this tariff-cutting authority, the President could, immediately prior to June 30, 1963, enter into agreements that could have 5 years to run, making this measure potentially effective for 10 years. On both counts we deem this measure unwise. Commencing July 8 before a special Senate Interstate and Foreign Commerce subcommittee it will be the Senate's purpose to conduct a full and complete study of all factors affecting commerce and production in the textile industry of the United States. In this connection Senator Norris Cotton of New Hampshire has said: As a Nation, we simply cannot afford to let this basic industry perish. Senator John O. Pastore of Rhode Island has described the basic purpose of the investigation: to analyze the cause of the decline of the American textile industry and consider possible cures. Further, Senator Cotton has said: *** the industry cannot be cured in a single stroke. Gentlemen, the greatest malaise affecting the wool-textile industry in general is the lack of confidence in our foreign-trade policy as charted in the bill before you. Deal effectively with this measure by recapturing your constitutional authority over our foreign-trade policy; give us reasonable expectation of fair foreign competition, and the effect will be singular-and to the national benefit. (Exhibits A, B, and C are as follows:) EXHIBIT A JUNE 1958 DATA ON "50 PERCENT CONTRACTION IN THE WOOL TEXTILE INDUSTRYDANGER AHEAD" Page 5. "Where the industry is located": As of December 1957 the distribution is as follows: New England, 44 percent; South, 32 percent; Middle Atlantic, 18 percent; North Central, 5 percent; West, 1 percent. Page 6. "Machinery loss over 50 percent since 1946": The 1946 and 1955 figures as charted are repeated here with the addition of the years 1956 and 1957. Page 7. "Cloth production, employment drop sharply": The 1946 and 1956 figures as charted are repeated here with the addition of 1957: Million linear yards 604 359 329 1946_ 1956. 1957 Production drops 46 percent. Pages 8 and 9: "Wool textile imports hit United States from East and West". Page 8: Page 9: "Imports of woven wool cloth jump 673 percent to 32,235,000 yards in 11 years. 1957 main sources Britain_ Japan. Italy. France Page 10. Loss $26,836,000 in 1954. Page 11. "The threat to national security" : 1957 broadlooms, 18,400; lost capacity, 20,600. 1957 total production: 317 millions of linear yards. EXHIBIT B [Emphasis added] EXECUTIVE OFFICE OF THE PRESIDENT, Yards 15, 600, 000 7, 800, 000 3, 800, 000 1, 300, 000 Office of the Director, Washington, D. C., January 6, 1958. Mr. EDWIN WILKINSON, National Association of Wool Manufacturers, New York, N. Y. DEAR MR. WILKINSON: On March 14, 1956, your association requested the Director of the Office of Defense Mobilization "to investigate or reappraise what the petitioners consider to be the threat to national security presented by wool textile imports, within the meaning of section 7 of the Trade Agreements Extension Act of 1955." Accordingly, investigations were set in motion and included, on June 3–4, 1957, public hearings on your petition. Since that time, additional and more current information has been sought and obtained, other agencies of the Government have been consulted and an analysis has been made of all the evidence available. This review and analysis have been directed at the material presented, and at the various viewpoints expressed, as well as at other pertinent factual data. It should be noted, however, in conformity with the legal responsibilities of the Director of the Office of Defense Mobilization, that our study has been confined to the national security implications of the imports in question in relation to the domestic wool textile industry. We accept the general premise you stated that "past experience in national emergencies has established beyond reasonable doubt that an adequate wool tertile industry is essential to national security." At the same time, past mobili |