Senator DOUGLAS. What are the total imports in dollars, dollarwise, of chemicals in this country; do you remember? Mr. HOOKER. The total imports-well, let me see; I cannot give you the figure, but it is approximately $500 million. Senator DOUGLAS. What are the total exports of chemicals? Mr. HOOKER. The total exports, sir, is a very controversial figure, because, as published in any Government publication, they include chemicals and allied products, and you would be amazed how many things can be allied to chemicals, and so you get a great distortion of what we in the chemical industry regard as real chemicals. Senator DOUGLAS. Can you remember what the Department of Commerce figures are on chemicals and allied products? Mr. HOOKER. I think it is approximately three times. Senator DOUGLAS. A billion and a half? Mr. HOOKER. A billion and a half; something of that kind. Mr. HOOKER. I would like to say, sir, it is my recollection, we in the chemical industry would accept approximately $800 million as a reasonably accurate figure of chemicals. Senator DOUGLAS. What are some of these allied products? Mr. HOOKER. The others are allied products. Senator DOUGLAS. What are these allied products? Mr. HOOKER. They are phosphate rock; they are dried blood; there are all sorts of strange things. Senator DOUGLAS. I would imagine that the exportation of dried blood would come to enormous dollar figures. Mr. HOOKER. As I say, these are examples. Senator DOUGLAS. Have you ever prepared an analysis of the billion-and-a-half figure and listing the specific allied-products items that you think are not chemicals and the value of the exports of each of these? Mr. HOOKER. I think that there is in the room one of my associates who has a list of several of those that I could-if you will excuse me a moment. Senator DOUGLAS. Surely. Mr. HOOKER. Here are some of the things, Senator; fertilizer material, such as dried blood; phosphate rock, coke ovens byproducts, pharmaceutical preparations. Senator DOUGLAS. Excuse me; on that pharmaceutical products, aren't they chemicals? Mr. HOOKER. Yes. They are chemicals in a real sense. Senator DOUGLAS. Isn't phosphate really a chemical? Mr. HOOKER. In the form of rock, I would not think so. Herbs, leaves, roots, pigments, paints, varnishes Senator DOUGLAS. Wouldn't you say paints are chemicals? Mr. HOOKER. Closely allied, sir, and this is the confusion, because they throw it into something they call allied products. True, there is no question about it. The oil industry is very closely allied with the chemical industry and, in fact, in many areas it is the chemical industry, but still we talk about oil Senator DOUGLAS. The figures on oil published by the Department of Commerce, though, are separate, are they not? Mr. HOOKER. Yes. There are toilet preparations, turpentine, gums, and other naval stores. Really, none of those things are what I think we here are talking about-the chemical industry. The fact is that we cannot get an exact analysis to answer your question, because the figures simply are not available in an accurate way, sir. Senator DOUGLAS. But, even according to your figures, your exports of what you would classify as chemicals approximately are $800 million? Mr. HOOKER. They are more than Senator DOUGLAS. Sixty percent more? Senator DOUGLAS. Suppose we imposed quotas on chemicals coming from abroad; might not this lead the other nations to impose quotas on chemicals coming from us and, therefore, would we not injure the chemical industry more by that program than we would help them, taking the industry as a whole? Mr. HOOKER. Sír, a great many, I cannot say all, but almost all of the European countries do impose quotas. Senator DOUGLAS. I know, but they might impose more rigorous quotas. Mr. HOOKER. Yes, sir, it is a matter of degree. They might impose more rigorous ones, this is quite true. Senator DOUGLAS. The chemical industry really has me puzzled, because the export figures are greater than the import figures and yet we have these big chemical companies asking for either higher tariffs or more restrictive quotas, and I wondered whether it is only certain branches of the chemical industry who feel this way. Mr. HOOKER. Sir, if I can make some remarks on that, I am reasonably sure that you have listened to enough speeches on this subject to recall that right after the First World War, Wilson himself said that the chemical industry of this country should never find itself again in a position where it was dependent so totally on foreign production, and so there was built into the law a protection for the chemical industry. The chemical industry of the United States is very proud of itself. It does not regard itself as an infant or a weak industry. We are very proud, we are very proud of the contribution we have made as an industry to the security and the strength and the economy of the country. We want to preserve that strength for its usefulness and for its profit. We feel that the trend is wrong. We are not asking for higher tariffs, we are asking to let them stay where they are long enough to have a really honest opportunity to see what the facts are. Senator DOUGLAS. You are asking for more restrictive quotas, though. Mr. HOOKER. In some cases, yes, where necessary in an emergency. Senator DOUGLAS. If you can export your chemicals abroad and meet foreign competition abroad after paying the shipping costs, why are you afraid of competition here at home from abroad? Mr. HOOKER. I think your statement-there are obvious exceptions to all statements, sir. I can only just give you my own experience in our company. Immediately after the war representatives from Switzerland and from Italy and from France and from England, Germany, came to my door, I live at Niagara Falls, and I opened the price book and said, "Well, we have so much of this," and they bought a great deal of our chemicals. That trade has dried up completely. There is none of it for us. Senator DOUGLAS. What do you manufacture? Mr. HOOKER. We manufacture caustic soda and chlorine; processed chemicals, and then we manufacture detergents, things that go into soap, and go into the manufacture of rayon, go into intermediates for dyestuffs, for bleaching textiles or for dyeing textiles. We have a very substantial plastics division in our company. Mr. HOOKER. Hooker Chemical Corp. Senator FREAR. You also manufacture paradichlorobenzene? Mr. HOOKER. Yes, sir; we do. There is a product-and I may say, sir, if I may, partially in answer to you, Senator, the thing that bothers us, will you gentlemen excuse my back, I don't know quite how I can Senator FREAR. That is quite all right. Mr. HOOKER. The thing that bothers us in the industry is that almost every week, perhaps every day, during the last 2 or 3 years one more product that we in the Hooker Co. have been making, or that somebody in Monsanto or in Du Pont or Dow has been making, has fallen by the wayside because we cannot make it and deliver it at the doorstep of the buyer for as little as our foreign competition is doing. And it is just such attrition that we want to stop. We are still very healthy, as an industry-not right at the moment, we could stand a whale of a lot of orders, but we are not asking for a great deal of sympathy, sir, we are asking for understanding. We are asking Senator DOUGLAS. You want something more substantial than sympathy, don't you? Mr. HOOKER. Yes, sir. Senator DOUGLAS. I mean sympathy is pleasant emotionally but it is not of much aid economically? Mr. HOOKER. Yes, that is right. We are just trying, if we can, to be let alone under present conditions long enough to see if under these conditions we can continue to exist as a Senator DOUGLAS. Are you afraid more of what may happen to you in the future than you feel injured by what has happened to you to date? Mr. HOOKER. We know Senator DOUGLAS. Is it the future that you fear rather than the present? Mr. HOOKER. It is the present-the present has not been extremely serious it has been serious. You know to the fellow who has lost his job, it is a depression, but to his next-door neighbor, who is working-it is a recession. But some people have been seriously hurt. In our case, because most of our things involve large freight charges, why we have not been so seriously hurt. But our problem, our immediate problem, is that a great many of our chemicals go to the companies who have been hurt, so we are losing our customers in this country. Senator DOUGLAS. Mr. Hooker, I do not want to prolong this too long, but in 1930 because such pleas as this and at a very similar time, because there was high unemployment then, we increased the tariffs and almost immediately in reprisal for our increase in tariffs the European nations increased theirs, and also began to impose quotas. Now, aren't you somewhat afraid that if we were to impose quotas as you wish, and if the Tariff Commission were to impose quotas which you suggest, and, as you suggest, we made it relatively impossible for the President to overrule them, that the net result would be that the foreign countries would then begin to still further restrict the importation of American chemicals and that would hurt the American chemical industry more than you would be helping the chemical industry here by imposing quotas on goods coming from abroad? That is, haven't you more to lose from a tariff or quota war than you have to gain and haven't you more to gain by getting the nations of the world to reduce tariffs and quotas than you have to lose? Mr. HOOKER. Sir, as we have said here, we are not opposed to a truly reciprocal trade agreement. It is our feeling that as it has been administered the results have not been reciprocal for the chemical industry of the United States. Senator DOUGLAS. Can you back that feeling up with facts, sir? Mr. HOOKER. Well, no, I do not think just at this point I can back that up with statements that would be relevant here. But this is perhaps a high degree of emotion but I think there is a high degree of fact also that could be supported. Senator Douglas, I would be very glad if you could produce the facts. Mr. HOOKER. I would be delighted to attempt to. Senator DOUGLAS. In a supplemental memorandum. Mr. HOOKER. To supplement that statement for the record, if you would like to have it. Senator DOUGLAS. May I ask if there is a representative of the State Department present? I wonder if we could ask the State Department to submit a memorandum if they have not already done so, on the concessions which they believe they have obtained from foreign countries under the reciprocal trade agreements. Senator FREAR. Does the Senator from Illinois desire the Chairman to request such information? Senator DOUGLAS. I would like to have him do so if he can do so. Senator BENNETT. Is the Senator referring to chemicals specifically? Senator DOUGLAS. Not only chemicals but other commodities in general because the same charge comes up from time to time the reciprocal trade program is not reciprocal, that under it we make concessions but do not obtain corresponding concessions from other countries, and I would appreciate it very much if we could have a tabular presentation of the concessions which the State Department believes we have obtained from abroad together with the concessions which we have made, so that we can bring it out of the realm of emotion on either side into the field of fact. Mr. HOOKER. I would rather, sir, have an opportunity to get some facts Senator DOUGLAS. Yes, I understand. Mr. HOOKER (continuing). Than to try to give Senator DOUGLAS. I hope, Mr. Chairman, that Mr. Hooker will be free to submit such a memorandum and it will be printed in the record at the conclusion of his remarks this morning. Mr. HOOKER. I would be very happy to do so if I have your per mission. Senator FREAR. You may do so. (The information is as follows:) SYNTHETIC ORGANIC CHEMICAL MANUFACTURERS ASSOCIATION Re hearings, H. R. 12591. Hon. HARRY F. BYRD, Chairman, Senate Committee on Finance, Senate Office Building, Washington, D. C. OF THE UNITED STATES, New York, N. Y., July 2, 1958. DEAR MR. BYRD: In accordance with the request of Senator Douglas, made of Mr. R. W. Hooker, president of this association, at hearings on the above bill on June 27, 1958, there is enclosed a supplemental memorandum on behalf of the association pertaining to the point that the administration of the trade-agreements program has not been truly reciprocal insofar as the synthetic organic chemical industry is concerned. Yours very truly, S. STEWART GRAFF, Secretary. SUPPLEMENTAL MEMORANDUM H. R. 12591, TO THE SENATE COMMITTEE ON FINANCE IN RESPONSE TO A REQUEST TO A REQUEST FROM SENATOR PAUL DOUGLAS, OF ILLINOIS On June 27, 1958, Mr. R. W. Hooker, president of the Synthetic Organic Chemical Manufacturers Association, appeared before this committee and during his testimony was interrogated by Senator Douglas, of Illinois. In response to a question, Mr. Hooker stated, in effect, that the association is not opposed to a truly reciprocal trade-agreements program, but that it feels the administration of the present program has not produced reciprocal results for the organic chemical industry of the United States. Senator Douglas requested that this opinion be supported by a statement of facts (transcript, pp. 1266-1267). The organic chemical industry of the United States has found it increasingly difficult to export many of its products. In some instances, foreign countries which formerly were export markets have practiced numerous devices to restrict organic chemical imports or to establish absolute embargoes. Many countries of the world, including the Soviet, are establishing or expanding their organic chemical industries. These efforts are governmentally encouraged to provide these nations with equipment and know-how, which is essential to the conduct of modern warfare of either an offensive or defensive character. Just as the United States after World War I deemed it a prudent national policy to foster and encourage the development of a strong organic chemical industry in the United States, today the United Kingdom, Soviet Russia, Italy, India, West Germany, and other nations are following the policy so vigorously suggested to the Congress by President Woodrow Wilson. It is almost impossible to introduce certain synthetic organic chemicals and chemical products into Italian commerce. Aside from its conventional importlicensing system, which may be administered unequally, a wide variety of restrictive devices outside the field of tariffs are employed. For example, a completely effective embargo has been imposed in Italy barring the sale of certain American-made organic dyes and intermediates. In order to import these products into Italy it is necessary for the American exporter to disclose the complete chemical structural formula of each product. Such disclosure of unpatented information would reveal carefully guarded trade secrets to the private import |