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would dismantle the long-term national policy on which it has staked its investment and its skilled employees their livelihood.

At the present time, much emphasis is being laid on the need for steady national growth in investment, employment, and production. The theme is common in Government, economic, and business circles. If this bill becomes law, however, the soft fiber industry must make it very clear that it can offer no contribution to this expansion. It is idle to expect new investment, improvement, or growth in an industry that may learn any morning that its major products are on a list of proposed tariff concessions, and that the outcome may well be the halving, at least, of its tariff protection. No prudent financial advisor will look favorably on such a situation. If the powers contemplated in section 201 of the proposed bill are enacted into law, their mere existence will be sufficient to stifle all development in the U.S. soft fiber industry. We are sure that our industry is not the only one in such a case.

A very strong argument can be made, in fact, for the setting of a definite period, within which the United States would undertake to refrain from further changes in tariffs that are protective in character. Such a stabilization of the position would stimulate new investment and new growth in the industries to which such protection is vital. It would be a significant contribution to the national requirement for expansion.

It may be argued that the bill provides for an adjustment to lower tariffs, by spreading out their reduction over a period of time (sec. 243). This, we submit, is an illusion. If industries dependent on tariff protection will cease to expand when they are merely under the continuous threat of tariff reduction, as we contend, the prospect of definite market attrition, even when spread over 5 years, will be still more stultifying.

Over and above its opposition to the general purpose of this legislation, the soft fiber industry must express its great concern over certain specific parts of it. In section 221(a) there is a very significant reference to "articles or categories of articles." There is no definition, however, of the term "categories." It would appear, therefore, that for trade agreement negotiations, groupings of articles may be contrived that may suit the ideas of other countries but have no relation to economic facts in the United States. Arbitrary standard reductions in the duties applicable to all the articles in such artificial categories will be completely inequitable, and will display no consideration whatever for established U.S. industries.

Here again, the soft fiber industry can produce supporting evidence from its own experience. For at least 50 years, going back to the tariff of 1913, the national policy with respect to tariffs on jute yarns has differed from that applied to the major jute woven fabrics. The domestic industry produces specialized jute yarns, which are primarily intermediate materials for other industries, under tariff protection. The principal woven fabrics of jute are, however, the various kinds of burlap, the end use of which is very largely connected with agriculture and its products. It has not been the policy of this country in the last half century to foster the production of burlap, and the duties levied on it have been small and to be regarded merely as revenue raisers. It follows that a "category" plausibly made up of jute manufactures, and subjected to negotiation as such, would combine two sets of items entirely different in character and in their relation to domestic industry. A similar situation prevails in the flax section of the soft fiber industry. The manufacture of flax yarns of the kind used in industrial threads and allied products (some of which have considerable importance to the defense services) has been encouraged in this country by tariff protection for many years. Some flax fabrics are similarly situated. A considerable volume of other fabrics and of finished articles, of types which are not produced in this country in significant quantities, enter the United States at low rates of duty. If the latter items are put together with flax yarns and threads to furnish a "flax category," negotiations on an entity constructed in such an arbitrary manner will ruin the domestic flax spinning industry, which is already shrunken as a result of tariff concessions that have been made in earlier years; and they will carry down with it the domestic industry that maintains the weaving of certain flax specialities.

It is true that section 221(b) speaks of investigations. It also refers to "industries" and "to occurrence on a widespread basis in the industry"; and it fails to define the world "industry." It would be quite possible, therefore, to investigate the effect of any particular tariff reduction on an industry so widely defined that the effect could not be distinguished, while in actual fact the impact

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of the tariff reduction on particular companies was completely disastrous. It is relevant, we believe, that in title III of the bill, which speaks in sections 301, 305, and 303 of relief for industries, there is, nevertheless, no definition of the word "industry" and there is emphasis again (in sec. 305) on the criteria for relief which must appear "on a widespread basis in the industry." In consequence the criteria for relief found in subsection (a) of that section may well be applied to an "industry" set up on so wide a basis that they fail to signal any substantial effect on it. Yet within that industrial complex some well recognized and traditionally established subgroup may be in danger of extinction. All these provisions, which emphasize the width of the industrial sector that must come under consideration when the effects of tariff reduction are being investigated, must cause the greatest apprehension to individual companies, whose identities can well be submerged and whose interests can be damaged irreparably, if they are to be regarded arbitrarily as parts of "categories" which have no relation to the historic development of U.S. industry. We urge, therefore, that if renewed powers for trade negotiation are granted to the President, they should be so drawn that the negotiations affecting an established and identifiable industry are clearly defined, and that the procedures for investigation either by the Tariff Commission or by any other body are directed to the effect of reductions on such an industry.

In addition to its misgivings concerning the concept of industry identification embodied in title III, the soft fiber industry considers the specific criteria to be applied unduly restrictive, when compared with the "escape clause" provisions of the present law. Section 7(a) of the Trade Agreement Extension Act of 1951, as amended, calls for an investigation of serious injury or a threat of serious injury, to the industry producing products akin to those being imported. This affords the possibility of relief when an industry is threatened with injury but before the damage has been irreparable. Section 305(a) of the proposed law would require imports to cause or immediately threaten, on a widespread basis, significant idling of facilities, prolonged inability to operate at a profit and unemployment or underemployment of workers. Section 305 (b) requires, further, that efforts must be made "in an industry" to mitigate such damaging conditions, and that such efforts must have been found to be unsuccessful, before relief can be sought. The coupling of these two criteria in sequence means that an industry will be beyond help, for all practical purposes, before any assistance can be granted.

The soft fiber industry has questioned whether its opinion on the complex relief provisions of this bill would be an effective contribution to the discussion, recognizing its own relatively small size. It has decided not to enter into the kind of detailed exposition which can be, and undoubtedly will be, made more cogently by larger trade organizations. It desires to conclude this statement, however, by stressing one fundamental opinion, which is, that the proposed measure is in its entirety a dangerous inversion of the procedures natural and proper to a free enterprise system.

The early national policy of that system, as it is established in the United States, was to foster industrial development by tariff protection. The continuance of that protection has been given the salutary accompaniment of intense internal competition. The result, which is the phenomenal economic and physical development of this country, speaks for itself. The United States enjoys the most advanced economic well-being to be seen in the world today. While the country has been attaining this enviable state, however, its wage rates expressed in terms of currency have drawn away from those obtaining in other countries of comparable industrial development. As a consequence, U.S. industries, however efficient, which operate without the benefit of important natural advantages need continuing tariff protection for their wage levels. Their situation in this respect is seen, in the light of history, to be the most natural result imaginable of the country's long-term policy. The bill seeks to overturn such industries by removing their protection, and then to salvage their remnants by measures which include counseling, technical assistance, loans of public funds, complex tax adjustments, and other devices. Economic mechanisms operating freely, smoothly, and competitively within a gigantic free enterprise system are to be wrecked and then painfully rehabilitated by complicated governmental procedures. Their specialized knowledge and capacity is to be rendered useless and is to be replaced by the well-meant but demonstrably less efficient ministrations of bureaucratic departments. To do this is to substitute

central planning for free enterprise and to adopt systems which this country has already repudiated. To call the entire scheme an inversion of America's basic policy is not, we submit, an exaggeration. The soft fiber industry opposes H.R. 9900 accordingly.

Mr. KING. Mr. Booher? Will you identify yourself for the record? STATEMENT OF EDWARD E. BOOHER, PRESIDENT, MCGRAW-HILL BOOK CO., ALSO IN BEHALF OF THE AMERICAN TEXTBOOK PUBLISHERS INSTITUTE AND THE AMERICAN BOOK PUBLISHERS COUNCIL

Mr. BOOHER. Thank you, Mr. Chairman and gentlemen.

My name is Edward E. Booher. I am president of the McGrawHill Book Co., America's largest publisher of books in science, engineering, and technology. I represent not only my own company, but the American Textbook Publishers Institute, of which I am the immediate past president, and the American Book Publishers Council, of which my company is an active member. The members of these two organizations, the ATPI and the ABPC, publish over 95 percent of the books produced in the United States, and, of course, a like percentage of books exported.

My own company is a very large exporter of books and only last week was honored by being chosen as 1 of the 10 organizations in the United States to receive from President Kennedy the new "E for Export" award being sponsored by the Department of Commerce in recognition of outstanding effort and success in exporting U.S. products or services. We are the only book publisher so honored. My views also represent those of Franklin Publications, a nonprofit organization of which I am a director, devoted to the publication of American books in foreign countries in the language of those countries.

The production and consumption of books in the United States is the largest in the free world, by far. In 1960, the most recent year for which complete statistics are available, we produced well over 1 billion copies of books at a dollar value of over $1.1 billion. This is in excess of twice the dollar volume in 1952.

The growth of book export has been even more rapid during this same period. Before World War II, the United States was a negligible factor in world book trade. We are now second only to the United Kingdom and are pressing for first place. In 1960, U.S. book exports were just over $80 million, while those of the United Kingdom were about $84 million. In 1952 our exports were about $30 million. In other words, our book exports have grown 250 percent in 8

years.

Our book imports subject to duties have also grown, but at a much lower level. In 1952 they amounted to approximately $6 million. In 1960 they were about $16 million, or about one-fifth our book exports and a little over 1 percent of the total domestic production of books.

There are several factors that account for this great expansion of U.S. book exports. The United States now leads the world in many fields of endeavor and scholarship, and our books in science, engineering, medicine, management, and education reflect the advanced state of these arts and professions in our country. The English language

has also become the leading language for purposes of higher education and the exchange of information at the professional level. These factors quickly help satisfy the great desire for technical advancement, for education, and for rapid economic development throughout the world. And trade barriers and exchange restrictions on books have been substantially reduced.

The bill before you, if enacted in its present form, would probably result in the virtual elimination of U.S. duties on books. Under section 202 of the bill, all import duties of 5 percent ad valorem or less could be negotiated down to zero. The principal U.S. duty in this field-applicable to books in the English language by foreign authors is now 5 percent and scheduled to be reduced to 3 percent in two steps under the international agreements recently announced by the President.

The only significant book tariff higher than 5 percent is that on books in the English language by American authors, which is now 9 percent and scheduled to go down to 7 percent within 2 years. It is entirely conceivable that this duty might also be eliminated under section 211 of the bill, the so-called 80-percent provision. This would almost certainly happen if Great Britain and four other European countries join the European Economic Community. The category into which books fall for purposes of section 211 under the Standard International Trade Classification is 892, "Printed Matter."

Thus under the bill before you, probably all U.S. duties on books would be eliminated before long, and we would strongly support such a move. The present duties are too low to have any real protective function and only serve as a threat to the generally favorable position we occupy throughout the world with reference to import duties and restrictions on the books exported by the United States. In view of the very favorable export position we occupy, we cannot afford to permit tariffs in this country to provide the excuse for retaliatory measures on the part of the countires to whom we sell throughout the world. But, not only is our rapidly growing book export business an important economic factor to the publishers of this country. Beyond this, we believe strongly that book exports serve our national political and cultural interests as well, and that as a nation we have everything to gain by the freest possible international trade in books. In brief, on the international scene, our books have seminal importance that far outruns their value as export products:

They serve as vehicles of philosophical, cultural, social, and political understanding among all nations.

They serve as basic tools for the development of human resources through education and training.

They serve as implements for the development of economic resources through the improvement of agriculture, commerce, and industry.

They are pioneers and conditioners of markets for the export of other U.S. products and services. "Trade follows the books."

Most important of all, perhaps, our books are a powerful means for keeping English as the lingua franca of the free world.

Although we strongly support H.R. 9900, I should like also to recommend to the committee another pending legislative measure that

would assist in accomplishing the aforementioned objectives so far as books are concerned. This is the so-called Florence agreement on the importation of educational, scientific, and cultural materials, which the United States has signed and which was approved by the Senate as a treaty in 1960.

A draft bill to implement this treaty was sent to the Congress last August and was referred to your committee. The agreement eliminates tariff duties on a reciprocal basis as among the signatory countries (now numbering some 40) on books, music, periodicals, newspapers, maps, and a variety of other educational materials.

In most of these categories the U.S. duties are very low or nonexistent. The agreement also contains some provisions tending to reduce exchange restrictions on these same materials. We would very much like to see the United States adhere to the agreement at the earliest possible date, and this view is shared by a large number of other organizations in the fields of science, education, and music. In conclusion permit me to say we hope very strongly that H.R. 9900 will be passed and that your committee will also approve and encourage the passage of the enabling legislation for the Florence

agreement.

Thank you very much.

Mr. KING. Thank you, Mr. Booher.

Are there questions?

Mr. Curtis will inquire.

Mr. CURTIS. I just wonder, inasmuch as you feel this way, if books could be put on the free list now. You don't need H.R. 9900. Is there anyone in the industry who wants this tariff?

Mr. BOOHER. I am sorry, Mr. Curtis.

Mr. CURTIS. Why has not the tariff on books been removed long before now if you and other publishers feel this way about it? They could be put on the free list. You don't need this legislation. Is there someone in the industry who feels differently than you do about it?

Mr. BOOHER. I think some of the people in the printing trades may feel differently, yes.

Mr. CURTIS. That is what I didn't know because this is the first testimony we have had in this area. Certainly your company, and I presume other companies, feel this way about it. I am just surprised that we have any tariff at all in this business. Some 60 percent of our items in trade are out of the tariff area, on the free list. It just seems to me you would have been moving to get this on the free list before now.

It could be on there now without this legislation.

Mr. BOOHER. I think if the publishing industry would go along with us it would be, if our wishes were carried out. I don't represent the position of all members of the printing industry, the printing trades.

Mr. CURTIS. In other words, you do feel that there are some people in here that feel differently and would object if this were put on the free list?

Mr. BOOHER. I am not sure of that at the moment. I think a number of those individuals will support this particular legislation.

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