of the domestic production of all ribbons, the ratio of the value of domestic production to domestic consumption of ribbons other than velvet and plush ribbons is considerably greater than the ratios given above.

Domestic exports.-The American silk-ribbon industry has gained a market Canada and Latin America, mainly because of quick deliveries to the retail trade or because the ribbons were not obtainable from Europe. A considerable increase in exports occurred during the war, largely owing to curtailment of European_competition. Exports were not recorded prior to January, 1922. For the first quarter of 1922 they amounted in value to $175,488, which was 70 per cent more than imports for the same period. 12 In the absence of official American export statistics in previous years, Canadian import figures are a more or less reliable barometer of our export trade. These show imports of "ribbons of all kinds and materials," under "other silk products," valued at $646,424, $1,481,545, $1,595,053, and $868,270 as coming from the United States in the fiscal years ended March 31, 1918, 1919, 1920, and 1921, respectively. The drop in 1921 was a falling off in American trade and not a general decrease in Canadian imports, which were $3,882,360 as compared with $2,844,386 in the previous year. There was some rise in the values received from France and the United Kingdom, but the greatest competitor to American trade was Switzerland, whose 1921 trade with Canada amounted to $1,812,962, over three times that of 1920 and more than twice the imports from the United States in 1921. Imports into Canada from 1910 to 1914 showed a gradual yearly increase from both the United States and Switzerland, in the first case from $106,108 to $160,505 and in the second from $287,567 to $512,504. Ribbon manufacturers consider it improbable that a large export trade will be maintained, because this trade calls only for goods from low-grade silk, such as are not advantageously produced in the United States, and because the European manufacturer caters to the export trade, while the domestic manufacturer offers only such products as he is making for domestic consumption. The fact, however, that ribbons were exported even before the war suggests that the domestic producer is able to manufacture those ribbons most advantageously made in the United States at a cost not far distant from that of his European competitor. Domestic exports in the last few years have been considerably larger than imports.

FOREIGN PRODUCTION.

In Europe, the greater availability and lower wages of skilled labor have allowed the survival of hand production. The same causes also permit the manufacture of elaborate Jacquard designsoften metal thread designs in small quantities to a pattern. Silk ribbons are produced most extensively in France, Germany, and Switzerland. In each of these countries the production is largely concentrated in a single ribbon-producing center: St. Etienne in France, Crefeld in Germany, and Basel in Switzerland.

The output of the French ribbon industry, as indicated by export statistics, has increased considerably since 1913. In 1913 exports of silk and mixed-silk ribbons other than velvet amounted to about

12 See Addenda, p. 58.

$9,000,000,13 and in 1920 to about $36,000,000.14 The exportation of velvet ribbons showed very little increase. According to report 15 the French production for 1921 is below the average and the Swiss industry is proving a strong competitor. Reviewing Swiss export statistics from 1885 to 1920,18 the industry seems rather to have declined than expanded. Considering quantity, the year of greatest exports was 1888; since 1895 there has been a very marked decrease, only slightly bettered during the first three war years. There was a decided slump in 1917-18. The next two years show a recovery equaling 1914 exports in quantity.

The manufacture of ribbons in Switzerland is not entirely a factory industry, some of the work being done in the weavers' homes on hand looms. For this reason there is more variety of product, and more elaborate designs can be worked out in the weaving.

It is not advisable to compare the trade figures of one country with those of another, because quantities, if recorded, are in different units, and exchange has been too variable to convert values to a common basis.

IMPORTS.

Imports for consumption. For the 30-year period, 1891 to 1920, the value of imports of silk ribbons averaged annually $1,382,247, with an average duty of $680,713. The average annual value for the first decade amounted to $1,531,203; for the second, to $2,040,439; and for the third, to $575,099. Because of fluctuations in demand, dependent upon changing fashions, imports from year to year show similar variation, so that the amount imported in any one year is of little significance. Between the fiscal years 1901 and 1903, to cite an extreme instance, the annual import of ribbons increased from $1,913,000 to $4,230,000, and dropped again to $1,673,000 in 1904, a rise and fall in four years of over $2,000,000. For several years labor conditions in the Paterson silk industry had been very much disturbed, and doubtless a shortage of domestic production accounted, in part, for increased imports. Between the fiscal years 1913 and 1915 a similar sudden wave of importation occurred. In 1912 and 1913 strikes had depleted the stocks of the domestic industry. In 1913 ribbons came into fashion, especially the elaborate styles most commonly imported. The rapidly rising demand reached an abnormal height in 1914, the annual report of the Silk Association of America saying, "It is unlikely that ever in the history of the American ribbon business have so many looms been operating as during the first nine months of 1914."

The fiscal year 1914 began July 1, 1913, when American ribbon stocks were low and when the vogue for ribbons was beginning to manifest itself. Imports of ribbons, which in the fiscal year 1913 were $596,000, rose, therefore, to $2,146,000. In 1915 the demand for ribbons collapsed. Ribbon production was reported to be the one branch of the silk industry in which there was almost no demand. Prices fell to a low point. Influenced by the high demand of the first nine months of 1914, importers had

18 From official French statistics, francs converted at par.

14 From report of Consul C. Corrigan, Lyon, France, Mar. 29, 1921, converted at 14.50 francs to the dollar. 15 The Textile Mercury, July 2, 1921, p. 24, and Commerce Reports, May 29, 1922, p. 565.

10 Compte Rendu des Travaux de la Chambre de Commerce de Lyon, 1918; figures for 1919 and 1920 from Swiss official trade reports.

placed large orders. As a result, in the fiscal year 1915, which included six months of the calendar year 1914, a much greater quantity was brought into the country than the market could absorb. Evidence of this appears in the excess of general imports (imports by countries) over imports for consumption which indicates that stocks were retained in bonded warehouses. The value so withheld from consumption, however, would not be as great as the differences in these figures would seem to indicate, as certain varieties of ribbons, notably those in chief value of metal threads and those ornamented with embroidery, would be included under general imports, but not under imports for consumption, where they would fall under general classifications of metal-thread and embroidered-silk articles, respectively. This is seen by a comparison over a series of years. From 1914 to 1920, inclusive, the totals given under general imports of silk ribbons have amounted to $6,464,733, whereas imports for consumption during the same years amounted to $3,866,979, a difference of $2,597,754. As so large a proportion of the amount consumed would hardly be allowed to accumulate in warehouses, and as reexports amount to practically nothing, some of this difference may be accounted for by ribbons of the two classes referred to above. Ribbons in chief value of metal threads are dutiable under paragraph 150 and embroidered ribbons under paragraph 358 of the act of 1913. Since 1915 imports for consumption have, despite increased prices, remained low in value. The highest was in 1921, when they were valued at $862,727. A comparison of the amount of the annual imports of ribbons with the condition of the domestic ribbon market, as reported in the annual reports of the Silk Association of America, indicates that in normal years, just as in these years of extraordinary demand, the rise and fall in the amount of imports accords closely with the rise and fall in the domestic demand. On the whole, however, although the domestic demand shows a tendency to rise, the value of imports displays a tendency to decrease.

Imports by_countries.—In 1914, 59 per cent of all imports were supplied by France, 36 per cent by Switzerland, and 3 per cent by Germany; in 1920 the percentages were 78, 13, and 2.8, respectively; in 1921, 64 per cent came from France, 20 per cent from Switzerland, and 11 per cent from Germany. While the proportion of imports supplied by each of the several foreign countries in 1914 was roughly typical of the decade preceding the war, the portion of the imports supplied by France had shown a tendency to increase and those supplied by Germany to decrease. The greatly increased proportion received from Germany in 1921 is difficult to explain except on a basis of depreciated exchange. This theory is substantiated by the low unit value of the German goods, 6 cents per yard as compared with 11 cents for the French and 14 cents for the Swiss.17

Nature of imports.-Imports of silk ribbons are mainly of those required in quantities so small that domestic mills consider it unprofitable to make the frequent changes necessary to hold this

17 In 1918 the proportion of the total imports supplied by Switzerland greatly declined. This drop was explained by the United States consul in Switzerland as being due to an artificial inflation of ribbon prices in Switzerland through an agreement of the merchants in Switzerland regulating prices of sales to England. Though they were willing to make special prices for sale to America, "market value" on which duty is computed was so inflated that the present ad valorem rate proved prohibitive. (Report of United States consul at Basel, June 10, 1918.)

trade. They represent largely extreme novelties, including gold and other metallic effects, as well as the complicated multicolored Jacquard designs. The importation of staple articles practically stopped years ago. Ribbons made in very small amounts, and ribbons of very fancy weave, or with metallic threads, as has been previously explained, require unusually large amounts of hand labor by exceptionally skilled workmen, and are, therefore, not extensively made in the United States. In years of abnormal demand, such as 1903 and 1914, ribbon imports probably contain considerable amounts of staple ribbons comparable with the usual run of domestic manufacture, imported only to supply a temporary shortage. Thus, imports of ribbons are, generally speaking, supplementary to domestic production, and do not compete with it.

TARIFF HISTORY.

Previous to 1909, no specific provision for silk ribbons was made in the tariff. There was much litigation concerning the dutiable classification of silk ribbons, which in one line of cases involving large refunds to importers were held to come within the tariff designation for trimmings, but later, under the act of 1897, they were classified as manufactures of silk not specially provided for when not commercially known as trimmings. In 1909 ribbons were specifically provided for under about the same description as is used in the act of 1913, and made subject to a duty of 50 per cent. Since 1913 they have paid a duty of 45 per cent. In the fiscal year 1914, the year in which the tariff act of 1913 went into effect, imports of ribbons, as has been previously explained, increased to a figure several times that of the preceding year. However, subsequent to the fiscal year 1914, imports have been exceptionally small, and in the first three months of the fiscal year 1914, when the former tariff was still in force and when it was known that the lower duty would become operative in the last nine months of the year, more goods were imported and entered for consumption, than had been imported and entered for consumption in the preceding year. Owing to these facts and to the sharp wave of extraordinary demand prevailing in 1913 and 1914, which has been previously discussed, the large import of 1914 can not be considered a result of the lower tariff of 1913.

COMPETITIVE CONDITIONS.

The domestic producer faces no great competitive disadvantage in regard to procuring machinery, or the cotton yarn and thrown silk from which most ribbons are made, but must pay more for the spun silk used for ribbons of cheaper grades. As a whole, he suffers little disadvantage in procuring materials or equipment. The product is for the most part well standardized. The method of production allows extensive use of machinery and is well suited to domestic conditions. The industry, however, requires comparatively skilled labor in almost every process, and the domestic producer has considerable disadvantage in the smaller supply and higher price of skilled labor in the United States as compared with Europe.

The competitive position of the domestic and Euporean producer is different, moreover, in regard to the production of different sorts

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of ribbons. In producing ribbons of standard weave from high-grade materials, the competitive position of the domestic producer is strongest, for these ribbons permit of the most machine manipulation, involve the employment of the least highly skilled labor, and represent the lowest labor cost per unit of output. Such ribbons are extensively made in the United States and practically none are imported. Even before the war there were some exports of this type of goods. The competitive position of the domestic producer is less strong in regard to the production of ribbons made from low-grade raw silk, even of standard weave, for the machinery can not be run at such high speed, and, as has been explained, the labor cost per unit of production is greatly increased when low-grade silk is used. Therefore it does not pay the domestic producer in the same proportion to manufacture ribbons from low-grade raw material.

Finally, in the production of ribbons demanded in small quantities, of ribbons of complicated weave, of ribbons made with tinsel or metal thread, and of ribbons made on hand looms, the competitive position of the domestic producer is weakest. The production of such ribbons requires not only an exceedingly large labor cost in proportion to total cost, but the employment of very highly skilled labor. They are not extensively produced in America, and the most extreme types could not be profitably produced here without a much higher degree of protection. They form almost the entire import, which is therefore not competitive with domestic production.

The ribbon industry is a branch of the silk industry which is of long standing and which is fully developed. The duties levied in recent years have prevented importation, except of the sorts of ribbons which domestic production is not well suited to handle, and of ribbons needed to supply a shortage of domestic production in years of swollen domestic demand. In normal years domestic production supplies the entire domestic consumption of ribbons advantageously made in America. The growth of the domestic industry is therefore mainly dependent upon the further growth of the domestic demand and the extension of the small export trade which has developed, rather than upon elimination of European competition.

TARIFF CONSIDERATIONS.

The variety of ribbons is so great, and the ribbon import so largely composed of specialties which can not be adequately covered by specific duties, unless those duties be based upon an unduly minute and technical classification, that specific duties on ribbons have generally been thought impracticable. Any specific duty would need to be reinforced by an ad valorem minimum rate clause to provide for articles with special factors of value which a specific duty could not take into account, and as few ribbons are imported except specialties, most of the import would consist of goods that would come within that clause. On this account, although the tariff act of 1909 imposed specific duties on most manufactures of silk, ribbons were made subject to an ad valorem duty.'

18

18 In a communication to the Tariff Commission (May, 1919) one of the leading men in the silk industry said: “An ad valorem duty was placed on ribbons in the tariff of 1909 when almost all other duties were specific, because of the difficulty of preparing a specific classification which would take into account the varieties in the 'ligne' (width) of ribbons as well as the variations in quality, fineness, weave, and other characteristics. An ad valorem duty was also chosen because it was found difficult to get ribbon producers to come to an agreement as to what would be satisfactory.'