I appear before your committee on behalf of an organization now in its 10th year, which believes that a sustained U.S. policy of freer international trade-seeking lower trade barriers throughout the free world community and opposing efforts to impose new restrictions on the movement of goods in international commerce is the trade policy best calculated to advance the national interest. We have always been strong advocates of the trade agreements legislation, and last year we strongly supported the Trade Expansion Act.

Senator COTTON. Mr. Steinberg, if you don't object to a brief interruption, would you, for the purpose of the record, be willing to give us a little more information about your organization.

You say you are the chief economist for the Committee for a National Trade Policy and appear on behalf of an organization in its 10th year?

Mr. STEINBERG. Which is the Committee for a National Trade Policy. I am appearing on behalf of the committee.

Senator PASTORE. That committee consists of representatives of some segment of the trade?

Mr. STEINBERG. No particular sector of trade, sir, but rather a group of businessmen, primarily businessmen, but also including many people who contribute to the committee because they believe in a policy of freer international trade. But our board of directors consists almost entirely of businessmen, and I could not identify them as being in exports or imports or any other particular sector of the economy. They are businessmen who, for a wide variety of reasons, believe that freer trade policies are in the national interest.

Senator COTTON. What is the membership of your organization? Mr. STEINBERG. Well, I don't know the entire number of contributors. We do not have members as such. We are a corporation, we have a board of directors, and there are some 35 members of the board, but there is a much larger number of individuals and organizations who cooperate with the committee and contribute to the extent that they can. There is no membership as such.

Senator COTTON. You understand, of course, that my questions do not imply anything improper about your organization. I was just curious to know who they are and where their interests lie.

Would you have any objection to filing as a part of your testimony the names and addresses of your directors?

Mr. STEINBERG. Not at all, sir.

In fact, I was going to bring a letterhead with me, and I forgot to do so.

Senator COTTON. I think that would be of interest to the committee and that does not indicate the slightest reflection on your organization. Mr. STEINBERG. I understand, sir. I will provide that.

(The matter referred to is as follows:)

COMMITTEE FOR A NATIONAL TRADE POLICY, INC.

BOARD OF DIRECTORS

Carl J. Gilbert, chairman, the Gillette Co., Chairman, CNTP.

E. A. Locke, Jr., president, Union Tank Car Co., vice chairman, CNTP.
Cecil Morgan, executive assistant to the chairman, Standard Oil Co. (New
Jersey), vice chairman, CNTP.

Charles P. Taft, Taft & Lavercombe, general counsel, CNTP.

John W. Hight, executive director, CNTP.

William L. Batt, Delray Beach, Fla.

S. D. Bechtel, chairman, Bechtel Corp.

Robert S. Benjamin, chairman, United Artists Corp.

William Benton, chairman, Encyclopaedia Britannica, Inc.

Barry Bingham, president and editor in chief, Courier-Journal & Louisville Times.

H. G. Bixby, president, Ex-Cell-O Corp.

Edward E. Booher, president, McGraw-Hill Book Co., Inc.

Harry A. Bullis, director, General Mills, Inc.

Thomas D. Cabot, chairman, Cabot, Corp.

Truman W. Collins, president, Collins Pine Co.
Philip Cortney, president, Coty, Inc.

John F. Fennelly, Glore, Forgan & Co.

Lamar Fleming, Jr., director, Anderson, Clayton & Co.

J. Peter Grace, president, W. R. Grace & Co.

Courtlandt S. Gross, chairman, Lockheed Aircraft Corp.

H. J. Heinz, II, chairman, H. J. Heinz Co.

Christian A. Herter, Jr., general manager, Government Relations Department, Socony-Mobil Oil Co.

R. W. MacDonald, vice president and director, Burroughs Corp.

Allen W. Merrell, vice president, Ford Motor Co.

Elmer F. Pierson, chairman, The Vendo Co.

W. J. Schieffelin, Jr., honorary chairman, Schieffelin & Co.

James S. Schramm, executive vice president, J. S. Schramm Co.

Adolph P. Schuman, president, Lilli Ann Corp.

A. B. Sparboe, vice president, Pillsbury Co.

Ralph I. Straus, director, R. H. Macy & Co., Inc.

Sidney A. Swensrud, Ligonier, Pa.

A. Thomas Taylor, chairman, International Packers, Ltd.

G. J. Ticoulat, Sr., vice president, Crown Zellerbach Corp.

Thomas J. Watson, Jr., chairman, International Business Machines Corp.
W. H. Wheeler, Jr., chairman, Pitney-Bowes, Inc.

Brayton Wilbur, president, Wilber-Ellis Co.

David J. Winton, president, Winton Lumber Co.

J. D. Zellerbach, chairman, Crown Zellerbach Corp.

John W. Hight, executive director.

Louis C. Krauthoff, II, director of financial and public relations.

David J. Steinberg, chief economist.

Senator NORRIS COTTON,

Committee on Commerce,

U.S. Senate, Washington, D.C.

WASHINGTON, D.C., May 24, 1963.

DEAR SENATOR COTTON: In response to the request you made during my testimony at the hearings of your committee on the problems of the textile industry, I am identifying the members of the board of directors of the Committee for a National Trade Policy. Their names appear on this letterhead.

You asked me whether any members of our board were importers or exporters. I responded that it was possible that one or two might be. I assume you meant import firms or export firms as such. On reviewing the composition of our board, I find that there are two who are engaged in the import-export business as such. There are other members of the board who import certain products and export certain products as part of their overall operations as manufacturers. There are still others for whom imports and exports have negligible and in some cases no importance to their activities. As I indicated during our colloquy, the directors of our committee have one purpose in mind in associating themselves with this kind of organization, and that is to support a national trade policy that serves the basic interests of the Nation as a whole.

I would like to take this opportunity to reiterate and I hope my testimony made this clear-that I am by no means minimizing the difficulties, in certain cases serious, experienced by the textile industry as a whole and each of its three major sectors in particular. It is vitally important that the basic problems of this and every other industry be met head on in a constructive and responsible way. The methods used to cope with these problems should be designed to deal constructively with the real problems found to exist, without compromising the interest of the Nation as a whole. In fact, if we deal constructively with industry problems, the interest of the Nation will indeed be advanced.

It is essential that the real strengths and weaknesses of the textile industry and each of its major sectors be thoroughly and objectively analyzed in order that a sound and responsible judgment may be made as to the extent to which Government help is needed and the precise form it should take. It could then be determined whether the trade restrictions which the industry is so vigorously seeking are indispensable to a soundly based program of adjustment and growth in this essential U.S. industry, and if found to be indispensable, exactly what forms of restriction should be established. It should be clearly understood that whatever restrictions are established should be for a temporary period during which a vigorous effort is made to solve the real problems of the industry, looking toward the elimination of the restrictions as soon as possible.

As I said during my testimony, I am not attacking the textile industry. I consider myself a friend of the textile industry, for many reasons including the personal one of owning stock in one of its major companies. It is essential that we as a Nation show the whole world including ourselves that we mean business in our advocacy of a vigorous policy of freer international trade. Again may I say that, as we cope constructively with the basic problems of the textile industry and every other industry, we shall be strengthening our national ability to make the most of the opportunities which freer international trade opens up, and cope effectively with whatever problems may follow in the wake of such a policy.

It was a great pleasure for me to return to the Senate Commerce Committee, where I spent so many interesting and rewarding months in 1960-61, and to engage in what I think was a useful exchange of views with you and Senator Pastore.

I hope that this entire letter will be placed in the record of your hearings. A copy is being sent to Senator Pastore.

With best wishes.

Sincerely,

DAVID J. STEINBERG,
Chief Economist.

Mr. STEINBERG. We believe the strength of the U.S. position in the councils of nations depends heavily on the credibility of the policies we espouse. In trade policy, this means that the United States should approach the international trade negotiations with an impressive negotiating position-one that reflects both the capabilities of the American economy and the determination of the United States to lead the rest of the world in another major step of trade liberalization. Trade policy credibility also calls for the rejecting of efforts to restrict trade, either within or outside the Trade Expansion Act, unless such restriction is clearly indispensable to a soundly based effort to adjust to a serious problem for which import competition is in large part responsible. The criteria to be used in determining both the seriousness of an industry problem and the extent to which imports are a major cause must be acceptable criteria of sound professional analysis, not political criteria based on pressure and the needs of political advantage.

The facts of a particular industry situation must be thoroughly explained for all to see. The rise of imports in relation to domestic sales or production reveals little beyond indicating that imports and the import ratio had increased. They invite attention to the effect of such import expansion on the domestic industry, but these import statistics themselves represent no acceptable criteria of market disruption. Disruption or injury can be determined only in terms of the effects of growing import competition on the industry, or of what is clearly likely to happen to the domestic industry in the absence of remedial action. Plant liquidations as such are not acceptable criteria of such impact.

The reasons for plant liquidation must be determined, and the real reasons are often not what company spokesmen claim. There is an easy and politically useful propensity to blame imports as the cause.

lways been a cause, but trade, either by export It would be the disrupd, and the consequences the number of plants ion in the industry; it stry has been changing better able to cope with petition that is sure to

y-whatever the extent ion has a stake in the e measured in terms as nited as the needs of a Olutions must be found prise and Government; about eventual progress action must be construccope with the real probt the expense of the nas of those who short-run who are most active in

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basic solutions to many has spoken out on this We did it most recently I for import restrictions mmerce Committee held lustry's quest for import I has so far been successreal effort to understand the lumber industry has istration, but from two onal Trade Policy is one

s, to its credit, provided nxieties, and the needs of Congress and the public, nd whether and to what help relieve a particular

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slugged in Sunane Magneet early in 1961-I am not satkramment baš socdorted a thorough, obiective I pros of the moongrica and the weaknesses of the textile industry Le muge goremment policies (Federal, State, and local) Szeptsam to the wing whatever serious problems are found. With cuties, va mold we more clearly whether trade restrictions are JAPSET DNA dw, what form they should take.

Your emme Las proposed remedies for textile industry probn addition to the advocacy of trade restriction. Our commitas uns ref pemposed constructive Government policies designed to be textile industry, and many of our proposals are identi12. to those which you have advocated-for example, those regarding termination, elimination of two-price cotton, and the need for more end benter research. What we have proposed with respect to the dustry is really part of our committee's overall interest in the need to strengthen the American economy so that it may both etalize to the fullest on the opportunities which freer trade opens up and cope successfully with the problems of import competition which may also follow in the wake of such a trade policy.

It seems to us that something as drastic as trade restriction, with the price we would have to pay in terms of our foreign and domestic economic objectives and the creditibility of our policy position abroad. must require as a precondition a judgment that nothing effective can be done for the industry concerned-and done on time-unless this action is taken. Assuming this precondition, it also requires as a second precondition a determination, clear for all to understand, that the period during which such trade restrictions remain in effect will be a period during which vigorous steps will be taken, through all the private and governmental instrumentalities available, to achieve a successful adjustment to the problems of foreign competition so as to make unnecessary as early as possible the continuation of those restrictions. We submit that the strengths and weaknesses of the textile industry have not been thoroughly and objectively evaluated to the extent that we fully understand the forms and scope of the constructive action that must be taken, and the extent to which trade restriction is

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