In most of the above towns the manufacture of clothespins constitutes the major if not the only, industry, and a large percentage of the employables in such towns are actively employed in the production of clothespins. Any reduction in the production of spring clothespins will create a very serious unemployment problem in such towns.

One very striking example of what can happen in such a small town when the principal industry in the town ceases operation is the case of Strong, Maine. In December 1947 the plant operated by the Forster Manufacturing Co. in Strong, which plant manufactured clothespins as well as a number of other wood products, burned down. At the time Strong had a population of approximately 800 individuals and a very large percentage of the employables worked in the Forster Manufacturing Co.'s plant. As a result of the fire, and the fact that the only other industry in the area could not afford employment to additional people, a large percentage of the population of Strong was forced to go on the relief rolls. At the present time the Forster Manufacturing Co. is constructing a new plant in Strong for the purpose of manufacturing clothespins, and it is anticipated that the situation there will be alleviated when construction has been completed and operations begin.

8. Most of the wood used in the manufacture of spring clothespins is purchased from farmers who have small wood lots. The balance is cut from stumpage owned or leased by the manufacturers or by contractors. The farmers, in most cases, are entirely dependent upon the sale of wood from their wood lots for their livelihoods. In a great many cases the only "hard money" these farmers see is the money they receive for such wood.

For example, in one New England State the average dollar value of wood purchased from farmers for production of clothespins is $506,000 annually. This amount is paid, as the purchase price of wood, to approximately 850 farmers. Obviously any curtailment of the production of spring clothespins will work an extreme hardship on these farmers. Moreover, 366 men are now actively employed by the clothespin manufacturers in such State alone for the purpose of cutting wood on stumpage owned or leased by the manufacturers. These men also will suffer through any reduction in the production of spring clothespins.

9. As heretofore noted, imported spring clothespins are currently being sold in the United States at prices ranging from 47% to 65 cents per gross, which prices include the present import duty of 10 cents per gross. The net amount received by the foreign manufacturers is from 371⁄2 to 55 cents per gross, less shipping costs, brokerage fees, etc. Even though the entire domestic market for spring clothespins were turned over to such foreign manufacturers, their gross receipts would not exceed $2,000,000 annually.

The interests of the above-listed manufacturers, all of whom are old wellestablished companies, and of the large number of employees, farmers, et al. who are dependent upon the domestic spring clothespin industry, should not be endangered merely to enable foreign manufacturers to share in such a small volume of business. The present rate of production of spring clothespins in the United States is more than sufficient to satisfy the entire domestic market, and any substantial reduction in such rate of production will necessarily create unemployment with its attendant problems. If foreign manufacturers are permitted to continue shipping spring clothespins to the United States, even at the present rate, a drastic cut in domestic production will soon be necessary.

CONCLUSION

In view of the existing differential between domestic manufacturing costs and the prices charged for foreign spring clothespins in the United States, the domestic industry cannot long survive without increased tariff protection. The 20 cents per gross rate established by the Tariff Act of 1930 is inadequate to afford such protection and early consideration should be given to an increase in this rate. Certainly the existing concessions to Mexico and Sweden should be eliminated at the earliest possible opportunity, and no further concessions should be granted. RICHARD A. TILDEN,

Attorney for the Demeritt Co., Diamond Match Co., E-F-D Division,
Forster Manufacturing Co., Inc., Munising Wood Products Co., Inc.,
National Clothes Pin Co., Inc., Penley Eros., the Wallace Corp.

The CHAIRMAN. The next witness is Mr. Brown.

Senator BREWSTER. I wanted to ask Senator Malone about the oil situation.

The CHAIRMAN. Senator, we have been thoroughly over the oil matter, and we had a half day here on oil.

I

Senator BREWSTER. On the Middle East situation?

The CHAIRMAN. Yes; they covered all of that.

Senator BREWSTER. All right, I will not ask any further questions. I have not been able to be here.

am sorry

The CHAIRMAN. It is in the record, and you were not able to be here, but we had a large number of witnesses.

Senator BREWSTER. All right, sir.

The CHAIRMAN. Mr. Brown, you may come around, please, sir. Let me make an inquiry: Has any study been made by the Tariff Commission of the imports of clothespins to which reference has been made?

Senator MARTIN. We have pending before us an application under the escape clause with respect to spring clothespins.

The CHAIRMAN. You have an application on that now?

Senator MARTIN. Yes. The Commission has not taken any decision as to whether a formal investigation will be made.

The CHAIRMAN. I thought you had perhaps made some recent study of the imports, but that perhaps answers the question that I had in mind, if there is a pending application.

Senator MARTIN. The Commission is also confronted with the question of a peril-point finding on clothespins in connection with negotiations.

Senator BREWSTER. If you do publish your findings on March 5, those will be included?

Senator MARTIN. Spring clothespins are included in the March 5 requirement.

The CHAIRMAN. All right, Mr. Brown, we will proceed.

Is there any statement you wish to make preliminary in regard to the particular subjects that have been discussed before the committee?

STATEMENT OF WINTHROP G. BROWN, DIRECTOR, OFFICE OF INTERNATIONAL TRADE POLICY, DEPARTMENT OF STATE

Resumed

Mr. BROWN. No, sir.

The CHAIRMAN. I believe that you put in yesterday a statement regarding the imports of wool; did you not?

Mr. BROWN. I testified yesterday on the watch question that Sena

tor Lucas had in mind.

The CHAIRMAN. Well, Senator Millikin, you wish to ask Mr. Brown questions, unless there is a preliminary statement that you wish to make, Mr. Brown.

Mr. BROWN. No, sir. I am appearing to answer the questions that members of the committee have in mind.

Senator MILLIKIN. Mr. Brown, yesterday you discussed the watch business. What is the State Department doing or contemplating doing about the fur business?

Mr. BROWN. We have no plans with respect to the fur business, as far as I know.

Senator MILLIKIN. The matter is not under study in the State Department?

Mr. BROWN. No, sir.

Senator MILLIKIN. You are not contemplating trying to reach any kind of agreement with countries that produce fur, and which are bringing into this country what appears to be excessive quantities?

Mr. BROWN. We have no request of any kind from the fur industry, and have not had for a long time, Senator.

Senator MILLIKIN. You would be receptive to representations from the fur industry?

Mr. BROWN. We always are.

Senator MILLIKIN. And if representations were made, and assuming that you felt favorably inclined, at least in a prima facie way, what would be your procedure in trying to relieve the situation?

Mr. BROWN. It would depend entirely on what furs they were. What the tariff situation was and whether they were in an agreement or not. What country was involved and what the facts of a particular situation were.

Senator MILLIKIN. Whatever the factual showings were, they would affect your viewpoint as to precise procedures, and possibly escapes

if there are escape provisions, and if there are not adequate escape provisions, as to what might be accomplished by negotiation?

Mr. BROWN. Yes. It would make a difference, for example, whether the fur was on the free list or not, as to what the legal authority of the President would be.

If it was on the free list, he would not be able even on recommendation of the Tariff Commission to change the duty. So the legal basis of authority differs with different facts.

Senator MILLIKIN. Has that free list become involved, or does anyone know what part of the fur items are on the free list?

Mr. MARTIN (Edwin G. Martin, Tariff Commission). All undressed furs are on the free list except silver fox. That included the platinum series. They are the only dutiable undressed furs.

Senator MILLIKIN. Has that free list been bound in any of your reciprocal trade agreements?

Mr. BROWN. I think some of them have.

Senator MILLIKIN. If they have been bound, and passing the question as to whether additional legislation is needed outside of the reciprocal trades system, then there are provisions in some of the reciprocal trade agreements for relief against the binding?

Mr. BROWN. Yes.

Senator MILLIKIN. Basically, there is a prohibition, is there not, against the President putting something in or taking something out of the free list; am I correct in that?

Mr. BROWN. Yes, sir.

Senator MILLIKIN. Even after you went through that first step, you would have a basic question of law, or a basic question as to whether the law should be amended?

Mr. BROWN. That is correct.

Senator MILLIKIN. And as to that you would have to determine, I assume, whether to recommend such a change according to all the facts of the case.

Mr. BROWN. Yes, the trade agreements organization or the departments concerned would hear the story and decide what kind of a recommendation should be made.

Senator MILLIKIN. To put it another way, so far as these free list items are concerned in the fur business, or in any other business, that would take a law of the Congress for it to be changed?

Mr. BROWN. Either a law of Congress or an agreement with the other country.

In the case of fox furs, at one time we did negotiate an agreement with the Canadians for a limitation of their imports to this country. Senator MILLIKIN. Now, as to the fish industry, is the State Department doing anything about that?

Mr. BROWN. No, sir.

Senator MILLIKIN. Or carrying on any negotiations with anyone? Mr. BROWN. No, sir.

Senator MILLIKIN. Any intention to do so at the present time? Mr. BROWN. No, sir. I take it that you are referring to fillets. That is included in the "General Agreement on Tariffs and Trade,' and the escape clause procedure is available if the industry cares to invoke it. They have not approached us on the subject.

Senator MILLIKIN. You have not been approached?