In Montpelier, and Waterbury, Vt., there are now about 125 persons employed in the manufacture of spring clothespins, and the industry has grown from the manufacture of a few hundred gross annually to nearly a half million gross, the output during 1920. Its growth has been especially rapid in the past six years, and it should continue to develop, as spring clothespins are coming in for more general use, not only as clothespins, but also in the manufacture of other articles, principally garment hangers. A great many are used by photographers, and a large number are used for paper clips, a large number are used in automobiles for hanging up hats,

etc.

Mr. GARNER. What is the total consumption in the United States in a year?

Mr. DEMERITT. Well, we have, as I said-we manufacture about a half a million gross.

Mr. GARNER. That is just your firm?

Mr. DEMERITT. That is the firms at Montpelier and Waterbury. Now, these other firms of which I speak, at Troy, N. Y., and Chicago, and the one in West Virginia, what their output is I do not know just how much.

Mr. GARNER. That is the total consumption in the United States? Mr. DEMERITT. Yes; at the present time; why, I should say that at the beginning there was made one or two hundred thousand gross, and it might be as high as six or seven hundred thousand now, which are made in the United States, or which were made during the past

year.

Mr. GARNER. Have you a patent on it?

Mr. DEMERITT. There was a patent on the United States clothespin. Then, we had a patent on the Holdfast clothespin. To-day those patents have run out, so now there is no patent on the spring clothespin. Now, as I say, so far as the Vermont manufacturers are concerned, we think there is no great difference in the total costs. We figure the cost per gross as follows:

I am unable to give the comparative costs of the foreign spring pins. The cost of the wood in the foregoing schedule is based upon a price of $40 per thousand for hardwood lumber.

The best information we have regarding the selling price of foreign pins is the report of Walter H. Shoales, American consul at Guttenburg, Sweden, under date of December 22, 1919, as follows:

Among the cheapest of Swedish manufacturers is the wooden clothespin of the wire-clasp type. This article, which is of world-wide distribution, also finds its way into the American market in large quantities. Its cheapness has hitherto prevented American manufacturers from competing despite the present high freight charges to the United States.

The following shows their selling price, cost, duty, and freight to New York, with present rate of exchange:

We do not contend that unfair practices have been directed against domestic manufacturers, but a similar result has obtained. Before the war large quantities of spring clothespins were sent to New York, they being included with other merchandise for the purpose, it is said, of making full cargoes, and on this account a very low freight rate was enjoyed by the foreign manufacturers. These pins were consigned to an agent in New York and sold by him at a price much less than our actual cost.

SOURCE OF IMPORTS AND PRICES AT WHICH OFFERED.

Nearly all the spring clothespins imported into this country come from Norway and Sweden. Spring pins are made in Germany, but compara.vely few have come to the United States. Before the war large quantities were coming from Norway and Sweden and were sold in at least one instance for 18 cents per gross. The price more generally quoted and at which large quantities were sold was 21 cents per gross c. i. f. New York, duty paid. At that time our own. costs were never less than 25 cents per gross, at factory, and had the war not intervened all domestic manufacturers of spring clothespins would have been forced out of business.

CHANGES IN DUTIES RECOMMENDED AND REASONS FOR SUCH RECOM

MENDATIONS.

Under our present tariff the rate of duty is 15 per cent ad valorem. We recommend a specific duty of 20 cents per gross. At present prices an ad valorem duty of 40 per cent would be a reasonable protection, but at prewar costs a 40 per cent ad valorem would still have allowed the foreign pin to be sold in America at about our actual

cost.

As already noted, the war saved our industry. During the past few months quotations are again being made by Norway and Sweden manufacturers, which, with the payment of the present rate of duty before noted, are considerably under our costs. The exchange rate very much in their favor; the cost of ocean freight is no more

is

than our rate to New York City, which is at present 69 cents per hundredweight.

While no doubt their manufacturing costs have increased since the war, the fact remains that foreign manufacturers can do business on a much smaller profit than the domestic manufacturers, as their overhead and private expenses can not in any way be compared to those existing in America. It is for the purpose of equalizing this difference that we seek protection. Under present conditions we are not able to compete for the spring clothespin business in the markets of the world, but we do feel that we should be protected in our home market. The keen competition among our now several manufacturers in the United States will regulate our price and at the same time tend to rapidly increase the use of spring clothespins.

SUGGESTED CHANGES IN PHRASEOLOGY IN THE EXISTING LAW.

We can find no mention of "clothespins" in the present tariff act. We recommend that "spring clothespins made from wood and wire" be specifically named under schedule "Wood and manufac tures of," or under schedule "Metal and manufactures of."

The CHAIRMAN. What are the goods selling for per gross?

Mr. DEMERITT. Well, at the present time our pins are selling for 70 cents a gross. Now, before the war, when we were having this competition, we sold as low as 25 cents a gross. Our actual cost per gross of pins was as low as 25 cents a gross, or our actual cost; but, of course, the foreign pins were coming in at 21 and 22 cents and naturally they were taking our market, although they could not get it all at once. As I say, the war came along and stopped the importation of foreign spring clothespins.

The CHAIRMAN. What were your costs before the war?

Mr. DEMERITT. Well, our cost never was less than 25 cents. The foreign pins were offered at 21 and 22 cents per gross.

Now, the war came along and stopped that importation and then, of course, we had the market and our business grew very rapidly, and has grown very rapidly during the last 5 or 6 years.

The CHAIRMAN. At what price are they offered now?

Mr. DEMERITT. As far as I can state, the lowest quotation that I have heard is 48 cents a gross. Mr. Walter H. Sholes, who is the American consul at Guttenburg, Sweden, under date of December 22, 1919, states "Among the cheapest of Swedish manufactures is the wooden clothespin of the wire-clasp type. This article, which is of world-wide distribution, also finds its way into the American market in large quantities. This has hitherto prevented American manufacturers from competing despite the present high freight charges to the United States. He states that they are being offered for 45.7 cents per gross. The lowest quotation that I have known is 48 cents, at which they are being offered.

Now, as I say, 20 cents per gross would protect us regardless of the price of the product. If the price of the product here, and everything else, goes down as it was before the war so that they could be bought at 16 cents, say, why, 40 per cent would not give us very reasonable protection, but at prewar cost, 40 per cent ad valorem would still allow the foreign pin to be sold in America at our actual cost, but 20 cents a gross, I believe, would protect us whether the

price is low or whether it is high. That is the reason we are asking for a duty of 20 cents a gross, and we trust that you will take this into consideration.

The CHAIRMAN. Mr. Demeritt, your time has expired.

Mr. GARNER. Can you give us the amount of imports that are coming into this country; do you give that in your brief?

Mr. DEMERITT. No; I do not. I do not know the amount that is coming in. Very large quantities came in before the war. Now, since the war, to my knowledge, but very few have come in to this country. They are just beginning to come in.

Mr. GARNER. You know that there are two classes of people who are appearing here, those who really know of importations and those who are scared that we are going to have importations. I wanted you to say just which one of those you come under.

Mr. DEMERITT. We know that there were large quantities coming in before the war. We are now just getting quotations, and, of course, naturally, we expect them to come in again.

Mr. GARNER. Then you are basing your request on the conditions which existed before the war?

Mr. DEMERITT. Yes.

The CHAIRMAN. You have a brief?

Mr. DEMERITT. I have filed a brief.

The CHAIRMAN. The next gentleman is Mr. Fred Buck.

STATEMENT OF MR. FRED BUCK, REPRESENTING LUFKIN RULE CO., SAGINAW, MICH.

The CHAIRMAN. Mr. Buck, give your full name, the interests you represent, and your address to the reporter.

Mr. Buck. Fred Buck, Lufkin Rule Co., Saginaw, Mich. I represent a company that manufactures exclusively rules, measuring tape, and other articles in measuring instruments.

We try to have a complete line to meet our customers' requirements. The CHAIRMAN. Mr. Buck, as the witnesses have been limited to 10 minutes, and I do not think there are any other parties representing the industry that you represent, and as we do not have a long list to-day, if you can not conclude in 10 minutes, we will try to give you a little more time.

Mr. OLDFIELD. What paragraph are you interested in?

Mr. DEMERITT. Paragraph No. 176 of the schedule.

Mr. BUCK. As I was going to say, in order to lead up to what I am going to say, I was going to tell you, on account of our desire to have all classes of goods in our line, we employ probably normally 1,000 people in this industry and the folding wood rule is the particular thing I am interested in this morning.

Mr. OLDFIELD. What?

Mr. Buck. Folding wood rules which come under paragraph 176 of the 1913 tariff, at 15 per cent ad valorem.

These rules were originated, you might say, in Germany. They are imported largely from Germany. In fact the Germans controlled this market in brief. Until 1910 there was only manufactured this class of rules in this country by a few people, and they were, like ourselves, making these rules at a very small margin for the reason that they wanted them in their line.

The sales of these rules have increased in the United States in the last 10 or 15 years, and they are displacing the old fashioned box wood carpenters' rules very largely.

Our manufacturers were not able, perhaps, to get more than 25 per cent of the business, and I doubt whether they had over 20 per cent of the business, and the only reason we were able to get that was the we had a complete line, which made the marketing of them easier for them than would have been for the German manufacturer, but we were obliged to sell them at a very low price as we handled many dozens of these rules, and did not feel that we could make them to advantage against the German manufacturer. In the year 1910 I personally was in Germany and made arrangements and started a small factory there at Leipsig. I found the conditions there very favorable. Labor was very cheap. We employed some girls who earned $2 to $3 a week, working by the hour or by piece work, and the men not over $1 a day.

A foreman which we engaged to supervise the work, we paid him to begin with 120 marks. Later we raised his pay to 140 marks. We gave him $35 a month instead of $30. And, the methods were efficient and we began to import these rules, for sale, into the United States, taking the whole output of this factory at prices named on these rules which allowed a small profit for the German factory. We were able to bring those in here and compete with American manufacturers and in the case at point, a little less, because we could bring them in and still make a small profit.

This was under the tariff of 1909, when these goods were paying 35 per cent duty. This went along until 1913 when the act was changed and the tariff lowered to 15 per cent which made it all the more easy for us to market these rules against the American manufacturers. And, I guess we quoted at least 10 per cent lower prices than they did.

The war came on in 1914 and, of course, we were absolutely cut off from our supply from the German factory.

Mr. GARNER. Do you still own it?

Mr. Buck. No; we do not. It was a sort of a working arrangement and that was disposed of in 1913 with an agreement that we should take all of the goods from them. We did not get our money out entirely. There was something like $2,500 still due, which we charged off several years ago.

Mr. GARNER. Then, you own no property in Germany?

Mr. Buck. No; we own no property in Germany at the present time, I am glad to say.

We found it necessary, having worked up this business to the point we did to still manufacture these goods, or to manufacture and sell them. The result was that we developed entirely a new department. We employ in that one department something over 200 people.

We have had no foreign competition because the Germans were actually cut off and were put out of the market, and I want to say right here that no other country produces them except Germany, with the possible exception of Austria, which is practically the same thing, at the present time.

Well, I was going to say that the cost of these goods is very largely labor. I would estimate that about 60 per cent of the cost is the