Duties are assessed on foreign values (lower values), and, compared, are as follows:

Plains: Lowest rate, 23.53 per cent, to highest rate, 49.24 per cent (ad valorem equivalent). Fancies: Lowest rate, 35.35 per cent, to highest rate, 68.4 per cent (ad valorem equivalent).

2 By lack of provision for this class.

NOTE.-Colored yarn goods are of a class not requiring any special added finishing costs. This class of goods bears the highest range of labor costs and conversion costs as established by the Tariff Board.

WILLIAM M. BUTLER, 77 FRANKLIN STREET, BOSTON, MASS. [Submitted May 29, 1913.]

The COMMITTEE ON FINANCE OF THE SENATE.

GENTLEMEN: Availing myself of the privilege accorded by the subcommittee of the Finance Committee of the Senate, I herein state certain considerations of vital importance in connection with the pending tariff bill as it relates to duties on cotton yarns and cotton cloth.

This statement is made especially with reference to the fine-yarns and fine-goods manufacturing business carried on in New Bedford, Mass., and has to do chiefly with the tariff on fine yarns and fine. gray cloth.

The prosperity of these mills, and indeed the community itself, is vitally concerned with the treatment of the tariff on fine goods and fine yarns, inasmuch as New Bedford is the largest center in this country for these goods.

New Bedford is a community of approximately 100,000 people. It has 25 mill corporations with plants having approximately 3,000,000 spindles and 55,000 looms. These mills employ from 25,000 to 30,000 people and represent a stockholding interest divided among 10,000 stockholders, and the whole community is dependent upon the prosperity of this fine-goods industry.

SCOPE OF THE BRIEF.

I do not favor the use of ad valorem rates alone in the framing of a tariff on cotton manufactures, and I have subsequently in this brief stated my objection to ad valorem rates and my arguments in favor of specific duties. I will not, however, attempt at this time to suggest a system of specific rates. If your honorable committee sees fit to make this structural change in the proposed legislation, I will be very glad to cooperate. It is my purpose, while not disturbing the structure of the proposed Schedule I in the Underwood bill, to suggest changes in classification and rates affecting yarns of 60's and over, and also fabrics containing these yarns. The framers of the Under

wood bill have not given sufficient weight to the fundamental distinction existing between the production of coarse cotton yarns and fabrics, on the one hand, and the production of fine cotton yarns and fabrics, on the other. I propose to emphasize and explain this distinction and to recommend such rates as are supported by the facts and figures found in the Tariff Board's report on Schedule I.

Inasmuch as the Tariff Board's report is the only available report whose impartiality is unchallenged, this brief is based upon it, and it is written to show that the board's report justifies the rates which I suggest. The rates which I recommend do not reflect my personal views as to what is required to maintain the industry in a prosperous condition, and if I were stating my own opinion, based on my experience, I would recommend rates substantially higher. This brief is written simply to meet a demand for a statement of what the rates on fine yarns and fine goods should be according to the findings of the Tariff Board.

ARRANGEMENT OF THE SCHEDULE.

The Underwood schedule is so arranged that the duty is fixed with reference to the number of yarns as yarn or in the cloth. This arrangement creates many difficulties in giving to the different branches of manufacture the consideration they deserve. For instance, certain numbers of yarns are used for the manufacture of print cloth; certain numbers of yarns, and some of them the same as used for print cloth, are used in the manufacture of ginghams, and in numberless ways this method of arrangement creates difficulties which are unavoidable.

Some attempt is made on numbers below 60's to consider some of these difficulties, but above 60's there is little, if any, appreciation of the fine yarns and fine goods manufacture.

It can be safely stated that the great proportion of the fine yarns and fine goods manufacture during the normal condition of business is represented by numbers between 60's and 99's, and yet these 40 numbers, comprising the entire group, are given by the pending bill only 20 per cent on all kinds of yarns, whether in singles, combed, plied, dyed, bleached, or mercerized, and 224 per cent on cloth, both plain and fancy, however expensive the yarn or labor entering into the manufacture.

It is extremely important that this group of 40 numbers should be broken up into at least four groups of 10 numbers each.

INCREASE IN COST.

Actual mill figures show that the production of cotton yarns per spindle decreases rapidly between number 60's and 100's. The production per spindle at number 100's is approximately 50 per cent less than at number 60's. In this same operation the labor cost increases over 100 per cent. This fact is not recognized by the proposed bill, which places a flat ad valorem rate of 20 per cent on fine yarns of 60's to 99's, and a flat ad valorem rate of 221 per cent on all cloths containing yarns of 60's to 99's. The per cent of the advance in cost is greater than the per cent of advance in price between 60's and 99's, and therefore the increased cost is not taken care of by a flat ad

Duties are assessed on foreign values (lower values), and, compared, are as follows:

Plains: Lowest rate, 23.53 per cent, to highest rate, 49.24 per cent (ad valorem equivalent). Fancies: Lowest rate, 35.35 per cent, to highest rate, 68.4 per cent (ad valorem equivalent).

2 By lack of prevision for this class.

This class of

NOTE.-Colored yarn goods are of a class not requiring any special added finishing costs. goods bears the highest range of labor costs and conversion costs as established by the Tariff Board.

WILLIAM M. BUTLER, 77 FRANKLIN STREET, BOSTON, MASS.
[Submitted May 29, 1913.]

The COMMITTEE ON FINANCE OF THE SENATE.

GENTLEMEN: Availing myself of the privilege accorded by the subcommittee of the Finance Committee of the Senate, I herein state certain considerations of vital importance in connection with the pending tariff bill as it relates to duties on cotton yarns and cotton cloth.

This statement is made especially with reference to the fine-yarns and fine-goods manufacturing business carried on in New Bedford, Mass., and has to do chiefly with the tariff on fine yarns and fine gray cloth.

The prosperity of these mills, and indeed the community itself, is vitally concerned with the treatment of the tariff on fine goods and fine yarns, inasmuch as New Bedford is the largest center in this country for these goods.

New Bedford is a community of approximately 100,000 people. It has 25 mill corporations with plants having approximately 3,000,000 spindles and 55,000 looms. These mills employ from 25,000 to 30,000 people and represent a stockholding interest divided among 10,000 stockholders, and the whole community is dependent upon the prosperity of this fine-goods industry.

SCOPE OF THE BRIEF.

I do not favor the use of ad valorem rates alone in the framing of a tariff on cotton manufactures, and I have subsequently in this brief stated my objection to ad valorem rates and my arguments in favor of specific duties. I will not, however, attempt at this time to suggest a system of specific rates. If your honorable committee sees fit to make this structural change in the proposed legislation, I will be very glad to cooperate. It is my purpose, while not disturbing the structure of the proposed Schedule I in the Underwood bill, to suggest changes in classification and rates affecting yarns of 60's and over, and also fabrics containing these yarns. The framers of the Under

wood bill have not given sufficient weight to the fundamental distinction existing between the production of coarse cotton yarns and fabrics, on the one hand, and the production of fine cotton yarns and fabrics, on the other. I propose to emphasize and explain this distinction and to recommend such rates as are supported by the facts and figures found in the Tariff Board's report on Schedule I.

Inasmuch as the Tariff Board's report is the only available report whose impartiality is unchallenged, this brief is based upon it, and it is written to show that the board's report justifies the rates which I suggest. The rates which I recommend do not reflect my personal views as to what is required to maintain the industry in a prosperous condition, and if I were stating my own opinion, based on my experience, I would recommend rates substantially higher. This brief is written simply to meet a demand for a statement of what the rates on fine yarns and fine goods should be according to the findings of the Tariff Board.

ARRANGEMENT OF THE SCHEDULE.

The Underwood schedule is so arranged that the duty is fixed with reference to the number of yarns as yarn or in the cloth. This arrangement creates many difficulties in giving to the different branches of manufacture the consideration they deserve. For instance, certain numbers of yarns are used for the manufacture of print cloth; certain numbers of yarns, and some of them the same as used for print cloth, are used in the manufacture of ginghams, and in numberless ways this method of arrangement creates difficulties which are unavoidable.

Some attempt is made on numbers below 60's to consider some of these difficulties, but above 60's there is little, if any, appreciation of the fine yarns and fine goods manufacture.

It can be safely stated that the great proportion of the fine yarns and fine goods manufacture during the normal condition of business is represented by numbers between 60's and 99's, and yet these 40 numbers, comprising the entire group, are given by the pending bill only 20 per cent on all kinds of yarns, whether in singles, combed, plied, dyed, bleached, or mercerized, and 22 per cent on cloth, both plain and fancy, however expensive the yarn or labor entering into the manufacture.

It is extremely important that this group of 40 numbers should be broken up into at least four groups of 10 numbers each.

INCREASE IN COST.

Actual mill figures show that the production of cotton yarns per spindle decreases rapidly between number 60's and 100's. The production per spindle at number 100's is approximately 50 per cent less than at number 60's. In this same operation the labor cost increases over 100 per cent. This fact is not recognized by the proposed bill, which places a flat ad valorem rate of 20 per cent on fine yarns of 60's to 99's, and a flat ad valorem rate of 224 per cent on all cloths containing yarns of 60's to 99's. The per cent of the advance in cost is greater than the per cent of advance in price between 60's and 99's, and therefore the increased cost is not taken care of by a flat ad

1

valorem rate. The counts between 60's and 99's should be divided into four classes and an advance of 24 per cent be made to the duty for each group in order to provide for the rapidly increasing cost and the decreased production. All the tariff bills since 1883 have recognized this principle. (Cf. Tariff Board's report on Schedule I, p. 475.) The accompanying chart shows clearly not only that there is a rapid rise in cost as the yarn becomes finer, but also that the rise is more rapid in the United States than in England. The difference in cost becomes greater as the yarn becomes finer. This of itself would prove that a flat ad valorem rate on yarns of 60's to 99's is not according to the Tariff Board's report, and this is similarly true of cloth containing yarn of 60's to 99's. A flat rate would only take care of the difference in cost if the rise in cost was the same degree in each country. Since the American cost rises more rapidly, a rising ad valorem is absolutely necessary.

FINE GOODS.

The production of fine yarns and fine goods is a comparatively small percentage of the total production of cotton yarns and fabrics in the United States. The making of these goods requires more equipment and skill and involves more risk than the making of coarser goods. In the manufacture of them the foreign manufacturer, with generations of experience back of him and his laborers, has a great advantage over the American manufacturer. The American fine-goods industry deserves the consideration of your honorable committee because it is a new and higher phase of the textile art, struggling to establish itself against the competition of a long-established industry abroad. Unless higher rates than in the Underwood bill are given, the development of this part of the industry will be arrested, if not destroyed. Fine and fancy cotton goods are not a necessity of the great majority of the American people. A high rate on them could therefore be justified on the ground that they are luxuries.

If such rates are placed on the products of this industry as will enable it to become established, domestic competition will regulate prices and the consumer will be benefited; whereas such rates as are found in the proposed Underwood bill would tend to eliminate the American fine goods from the market and to leave the market to the importer of foreign goods. The importer's tag will, then, be used to raise the price and the foreign producer will thrive at the expense of the American consumer.

YARNS.

The following rates are proposed for cotton yarns above No. 60's