domestic competition. Every dollar the Nation spends for imports is reflected sooner or later in exports-exports which create jobs and income.

The year 1958 is a critical year for the United States. The European Economic Community just formed presents us with the challenge of whether we will maintain our close relation with that area of the world by the mutual reduction of trade barriers, or whether we will stand by and watch Europeans reduce and eliminate trade barriers among themselves alone. Western Europe is a $5-billion export market for the United States, and we stand in danger of losing a substantial part of that market unless we extend this Trade Agreements Act. The Soviet economic defense presents another challenge. The committee must decide whether the United States is prepared to cooperate closely with the underdeveloped nations of the world and exchange our goods on a freer basis, to our mutual benefit or whether we are prepared to leave the field to the Russians.

I strongly urge the committee to approve H. R. 12591 intact.
Sincerely yours,

Hon. HARRY F. BYRD,

Chairman, Committee on Finance,

Ross CONNELLY.

WINTON LUMBER CO., Minneapolis, Minn., July 1, 1958.

Senate Office Building, Washington, D. C.

SIR: I wish to record my strong support for H. R. 12591, the trade agreements extension bill of 1958, as passed by the House of Representatives and now before your committee.

The provisions of the bill calling for a 5-year period of duration, 25 percent tariff-reducing authority, and retention of full discretion in the hands of the President on escape-clause cases, are absolute minima if the needs of the United States are to be fulfilled in the field of trade legislation.

We are all aware of the time schedule for the European Economic Community; we know that an extension of less than 5 years would not permit us to complete our proposed tariff negotiations with that community. We know, too, that the Soviets have launched a massive economic offensive, having as its purpose the progressive subversion of a large part of the free world.

While this trade agreements extension bill is in no respect a complete response to this offensive, it is an essential element in our economic defense: and certainly none of the alternative proposals involving shorter period of time or lesser authority can possibly make an adequate contribution to this historic challenge. What the Congress does this year with this trade agreements extension will either establish the basis for expanding United States and world trade, with all the economic benefits that would bring, or it will create a climate leading to progressive contraction of trade. We can have no doubt of the seriousness of the effect of that course of our economic growth, on our free-world leadership, and our common security.

May I again urge the committee to approve H. R. 12591 without amendment.

Sincerely,

D. J. WINTON.

STATEMENT OF THE NATIONAL BOARD OF THE YOUNG WOMEN'S CHRISTIAN ASSOCIATION OF THE UNITED STATES OF AMERICA IN SUPPORT OF H. R. 12591, THE TRADE AGREEMENTS EXTENSION BILL, JULY 1, 1958

By Mrs. Paul M. Jones, Vice President, New York, N. Y.

The national board of the Young Women's Christian Association of the United States of America has supported the Reciprocal Trade Agreements Act since 1934. We believe that the issue of freer trade has never been of more critical concern than it is today.

Our trade policies have a direct and continuous bearing on our relations with other nations. As one of the more prosperous members of the free world but also as a nation dependent on others for strategic raw materials, we be lieve that the United States should give leadership in liberalizing trade and placing it on a more secure and sound basis.

It would be unthinkable to return to the state of chaotic conditions prior to 1934 when nations resorted to high tariffs, quotas, and embargoes, which in

We

turn invited the reciprocal raising of trade barriers by other countries, so today it is urgent that we go beyond our policies of recent years during which we extended the Reciprocal Trade Agreements Act for merely 2 or 3 years. cannot afford to risk leaving the initiative in this area to the Communists whose system of grants, gifts, loans, trade, aid, and barter are all bent to a single purpose the reinforcement of Communist power. We must meet this threat in all aspects of our foreign policy, of which one of the most important is trade.

The minimum requirement to bolster the economies of the Western and uncommitted nations and to meet the Communist challenge is an extension of the Trade Agreements Act for at least 5 years, and the retention of the power of the President to negotiate with foreign countries through his authority to reduce tariffs. We oppose further strengthening of the peril point and escape clause provisions, believing that as they stand they afford adequate protection to our domestic industries.

We hope that your committee will report favorably on H. R. 12591, and that you will oppose any attempts at attaching crippling amendments.

STATEMENT FOR PRESENTATION TO THE SENATE COMMITTEE ON FINANCE IN SUPPORT OF H. R. 12591 BY P. G. WINNETT, CHAIRMAN OF THE BOARD, BULLOCK'S, INC. Gentlemen, deeply concerned with the importance of increased two-way trade to the growth of the American economy and with the need for American leadership in easing world tensions before it is too late, I should like to express my support for a 5-year extension of the Trade Agreements Act as proposed in H. R. 12591.

Bullock's together with other leading retail institutions in the United States have exerted much effort in encouraging the importation of salable articles manufactured abroad, having done so not only with the idea of stimulating domestic business but also with the aim of encouraging reciprocal trade.

The premise on which we base our support for a meaningful extension of the Trade Agreements Act without any further weakening amendments is made up of many things, including the following:

Reciprocal trade is not only good business for the American economy; it is also the keystone of a foreign policy designed to foster a world climate in which the American people can best fulfill their aspirations for ever-rising standards of living.

Expanding two-way trade is one of the main bases upon which we and our friends abroad can prosper without artificial Government supports which offer no enduring remedy to economic problems.

A liberal trade policy on the part of the United States, while the basis for the steps that must be taken to reduce the barriers to trade and to economic progress in general, is also a symbol of the role the United States wishes to play in the free world. It symbolizes our national outlook on the desirability of effective cooperation and enduring unity in the society of free nations. It is also a symbol of the dynamic free enterprise system which we like to hold high as an emblem of American economic strength.

The United States has an important stake in it own rapid economic growth as well as in the rapid economic growth of the other nations with which it is associated in the preservation of world peace. Failure to reduce further the barriers that impede trade between our country and the rest of the free world will hurt American industry, agriculture, and labor by increasing the obstacles to expansion of our country's export trade. An expanding economy needs expanding exports. The most important source of dollars for the rest of the world is sales to the American market. Our expanding economy needs and can easily absorb a greater volume of imports, which is also essential if we are to realize in dollars the earnings from the investment of American capital in foreign countries.

The European Common Market is only one example of the many new developments now taking place in the world with which the United States must be in a position to deal, if our economic and political interests are to be preserved and enhanced. We need a foreign trade policy adequately tooled to enable us to take suitable action in the face of these new developments. H. R. 12591, while not in every detail as strong an extension as we would prefer, still in our judgment provides adequate machinery to permit the United States to move quickly and effectively in the field of foreign trade.

We understand that there is considerable doubt in the Senate about the desirability of a 5-year extension, in view of the fact that we have never in the past had an extension for longer than 3 years. We are convinced that a 5-year extension is the minimum if we expect to be effective in meeting the many contingencies to which I have referred, and these include also the Soviet trade offensive against the free world. But I wish to emphasize that a 5-year extension is not a crash program designed to meet an emergency. There is an emergency, but a 5-year extension is undeniably within the capabilities of the American economy and necessary for the kind of stability American firms need in the Nation's foreign trade policy if proper, business-like planning is to be achieved. In view of our own economic strength, and considering the record of 24 years of trade agreements legislation and of the contribution it has made to our Nation's prosperity and security, the United States is ready for a 5-year extension. Anything less would be a sign of weakness.

We urge the Committee on Finance, and the Senate as a whole, to approve the bill as it passed the House of Representatives. To do so, would be more than an important step forward in fostering American prosperity. It would also constitute an important support for American prestige and leadership in a troubled world.

STATEMENT PREPARED FOR THE SENATE FINANCE COMMITTEE RE TRADE AGREEMENT EXTENSION BILL, H. R. 12591, PREPARED BY CARTER C. HIGGINS, PRESIDENT, WORCESTER PRESSED STEEL CO., WORCESTER, MASS.

The company of which I am president and general manager is a small company, employing less than 250 employees at present. We are in the business of making stampings of all kinds of metals, and we also produce a line of small pressure cylinders and, through a subsidiary, Mutual Products Co., Inc., a line of paper punches. As a businessman, I support the reference bill, although I would like to see it stronger.

Although my company is a small company, we are greatly affected by the volume of business done in this country. Many of our customers are beating companies in their fields, and when their products are exported our components go with them.

We are very much interested in anything that affects the total unit volume of our customers and business in general. The more that is sold, whether it is sold in this country or across our borders, the better our business will tend to be. In this connection, I would make two points. The value of international trade is larger with lower trade barriers. The figures cited showing a comparatively lower average rate of duty on our imports is not a measure of the small interference of present tariffs with international trade. It is merely indicative of the size of the hurdle that goods made abroad can jump. If three-quarters of our imports were duty free, and 25 percent could pass 100 percent ad valorem barrier, the average duty would be 25 percent. This would not indicate that existing barriers were 25 percent barriers. Maybe an equivalent total amount of imports is being kept out by the 100 percent rate.

People in other countries would like to buy the goods, into which our components go, if they had the dollars to buy them with, and I would prefer they get these dollars by free exchange rather than by our making gifts to them of which my company has to pay its share. They are hindered from getting these dollars by import regulations and tariffs, and if our great country is to be in a reasonable bargaining position, the administration should have power to reduce tariffs to maximalize international trade.

The second point, I feel pertinent, is that international trade is a two-way street with benefits for both the importer and exporter. Therefore, additional imports are countered by additional exports. I am not as despondent as some about the inefficiency of American industry and its inability to meet foreign competition despite substantially lower wage rates in some countries. Wages do not necessarily determine costs. We could never afford to have Chinese coolies receiving a few cents a day transporting our goods on their backs out of our plant. The trend of international trade, and the "dollar shortage” does not indicate inefficiency on our part. We are in a competitive business and are well aware how competition keeps us on our toes, how we have to shift to cost-saving methods, and how our customers show a benefit if they can buy good quality stampings from our competitors. These benefits would be taken away if our competitor's products were taxed and ours were not.

We would be greatly handicapped in what we could buy if we could not select the most efficient supplier.

The principal point I want to make at this time, however, is that if we could import another billion dollars, I am convinced that we will export a like amount, and a few dollars of this will show up in my company's orders for stampings which become parts of typewriters, machine tools, ball bearings, or one of many other products produced by our customers.

Now when we come to our costs, even a small company is affected by price levels of such imports as nickle, aluminum, various ores, heavy oil, and so forth. The cost of these items are already so high in relationship to what our customers and the American consuming public is willing to pay that we are most severely pinched. The same is true of each of our employees who are pinched by the present high-cost of living. There isn't a doubt in the world that some of these items would trend lower if it were not for tariff barriers. I can't see it any other way than that a vote against this extension, or for more limiting amendments, is a vote for higher cost of living, and a vote for higher cost for my company. How we can cover these costs may not be of direct interest to you good committee members, but is, I assure you, a great source of worry to me and to my company.

We, in small business, cannot retain Washington representatives to see that we can charge more for our metal stampings, or whatever we produce, because part of our competition is cut off. That you don't hear from us is not an indication that we do not bleed if tariffs raise the costs of what we have to buy, and what our employees have to buy.

The political realities of today require considerable latitude be granted to whatever administration is in power to do the best they can to keep our costs down to maximalize the demand for our materials. This situation is constantly changing. The Communist countries are more and more tending to try to disrupt world markets. They throw their buying power into making purchases at high prices to try to raise the prices we Americans must pay. They try to dump materials like aluminum in sufficient quantity at costs below fair costs to upset established export relations. The only solution I can see to this is that we have a maximum of flexibility to do what must be done. I am not a free trader; I am opposed to dumping. I recognize the importance of customs and duties as income to the Government of the United States. I would hope that we would see a gradual reduction of tariffs which would allow time for other companies to adjust to apparent situations. Because of rapid changes, we all are aware of, I think we must rely on administrative discretion as provided in this bill which would be enabled to plan its action across a period of years and develop peaceful relationships with foreign countries at the same time as providing for maximum trade and reasonable cost levels.

I believe the passage of this bill will increase the size of the market for American products. I believe its passage will serve as a check to inflation. I believe also in the provision for as much flexibility as possible, not to be exercised capriciously, upsetting the best laid plans, but in order to face political realities as the occasion demands.

I urge the extension be for 5 years. A shorter period is inadequate for planning, because I expect the Russian economic competition will be more marked a year from now than it is today; and, the longer the period we have to meet it, the better.

Hon. HARRY FLOOD BYRD,

Chairman, Committee on Finance,

H. J. HEINZ Co., Pittsburgh, Pa., July 2, 1958.

Senate Office Building, Washington, D. C.

MY DEAR SENATOR BYRD: May I express my strong support for the bill, H. R. 12591, Trade Agreements Extension Act of 1958. I urge the committee to approve this bill as passed by the House of Representatives, without further amendment. A 5-year period of extension is the minimum necessary this year, if the reciprocal trade agreements program is to adequately serve our Nation. That historic development, the European Economic Community, has adopted a time schedule for the first phase of its internal tariff reductions and for establishing a common external tariff, of 4 to 5 years. As the United States State Department spokesmen have indicated, the necessary preliminary work and the actual negotiations to follow will require a full 5-year grant of authority to the

President. A 3-year extension would expire precisely in the middle of these projected negotiations, and whether they could continue would depend upon a further extension of the program by the Congress at that time. Clearly, this would create a wholly unsatisfactory bargaining position for the United States; and there is real doubt that we would even begin negotiations under those circumstances.

Equally important with the 5-year extension is the 25 percent tariff reducing authority contained in H. R. 12591. The European community will reduce its internal tariffs 30 percent over this period of time, and if we are to enjoy approximate equality for our exports to the European market, we must be able to reduce our tariffs by at least that 25 percent. Western Europe is the most important single market for our Nation's exports, and it is of critical importance to the future of our foreign trade that we maintain our present position in that

area.

The Soviet economic drive toward underdeveloped countries is another development which has reached serious proportions in the last year or two. In the face of this offensive one of our major economic defenses will be our willingness to accept on a reasonably liberal basis imports from these underdeveloped countries-imports not only of essential raw materials but of the whole range of goods which these countries export, and upon which depends their foreign exchange position. Obviously, unless we are prepared to cooperate closely with these countries in satisfying their basic needs, their governments will be under heavy pressure to entertain the prospect of close relations with the Soviet bloc.

Finally, an adequate trade agreements extension is essential for our own economic welfare and growth. Expanding foreign trade is one of the major elements in an expanding United States economy. We cannot hope to increase our standards of living and provide jobs for the annual increase in our working population unless we are prepared to provide the economic climate for trade expansion.

The writer has had some direct experience as an adviser to the United States delegation to the GATT. I have become convinced that the Trade Agreements Act provides a workable and vital instrument for the achievement of our foreign economic objectives. From my own observation the negotiations under the GATT have been conducted by the American representatives with great care and with full regard to the interests of American industry, labor, and agriculture. This has been a sound program for some 24 years, and we cannot now afford to renounce it by adopting a 1958 extension which is neither adequate to our current needs nor expressive of the policy we wish to pursue. In my opinion, amendments to this bill, which would provide for only 1-, or 2-, or 3-year extensions; 5-, or 10-, or 15-percent tariff reducing authority; or drastic limitations on the President's discretions in escape-clause cases, will have the effect of making the legislation essentially meaningless. An extension of that kind would continue the program in name only.

May I, therefore, again urge the committee to recommend to the Senate approval of H. R. 12591 without amendment.

Sincerely,

HENRY J. HEINZ II, President.

STATEMENT BEFORE SENATE FINANCE COMMITTEE IN SUPPORT OF EXTENSION OF THE TRADE AGREEMENTS ACT BY LAMAR FLEMING, JR., HOUSTON, TEX.

My name is Lamar Fleming, Jr. I am a resident of Houston, Tex. I am chairman of the board of Anderson, Clayton & Co., a corporation whose principal business is dealing in cotton in this country and abroad, ginning, and seed crushing.

I served on the Commission on Foreign Economic Policy (Randall Commission) as Vice Chairman, and I attended the session to revise the General Agreement on Tariffs and Trade as an adviser to the United States delegation in 1954–55. Judgment of the merits of a trade policy for the United States must be in terms of the welfare of the American people, of present and future generations. For this purpose, I believe we can define welfare as achievement of the fundamental human desires for material well-being and personal freedom.

The civilized man recognizes that there are limits beyond which unbridled personal freedom becomes infringement on the freedom and well-being of others. and he submits, therefore, to reasonable restraints, imposed by his own sense of good manners and the laws of society. He recognizes, also, that a great deal