had a multiple rate, could be 21 pesetas per dollar. In other words, you see, you can cheapen your currency for whatever goods you want to ship to this country.

I have not gone into the technical details of this bill because I am not a lawyer, but I am expressing how the industry I represent feels about this bill.

Senator KERR. You are telling us what you believe to be the practical results of it if it were enacted.

Mr. DAILEY. That is right.

Senator KERR. All right, Mr. Dailey, we thank you for your appearance and thank you for what you have said.

Mr. DAILEY. Thank you, sir.

Senator KERR. Mr. Martin? All right, Mr. Martin.

STATEMENT OF ROBERT F. MARTIN, EXECUTIVE SECRETARY, VITRIFIED CHINA ASSOCIATION

Mr. MARTIN. Mr. Chairman, I am Robert F. Martin, executive secretary of the Vitrified China Association, 517 Wyatt Building, Washington, D. C.

Yesterday, a representative of the Staffordshire Potters of England appeared before you to demand that foreign value be included in section 13 of H. R. 5505 or that "the bill should be defeated and the existing law left in its present form."

Such a drastic demand from foreign sources as to how we shall administer our tariff is rather unusual and calls for careful examination.

1. Difficulties of determining foreign value under conditions such as exist in the case of English china at present were one of the reasons for eliminating this value from the provisions in this bill in the attempt to simplify administration.

*

In support of the present foreign value the Staffordshire Potters claim that it is "feasible * * simple, and direct, namely the price at which these products are offered for home consumption in the United Kingdom."

Here are the actual conditions under which it is claimed that this method is feasible. For some years now the British Government has prohibited the sale of decorated china in the United Kingdom. Over 99 percent of United States imports of Staffordshire china are decorated. Just how the foreign-value price can be feasibly, simply, and directly determined by obtaining the price at which it is offered for home consumption in the United Kingdom, when such sale is prohibited by law, is indeed a mystery.

2. It being in practice impossible to determine the foreign value reasonably in this case, the door is left open for just the sort of juggling that section 13 of this bill is trying to eliminate. Some of the exclusive United States importers are branches of the Staffordshire firms. With no sales of the exported patterns made in the United Kingdom on which it check, it is possible for them to ship to the United States branches at a very low value, in consequence pay a very low ad valorem duty, and take the mark-up and profit in the United States. The elimination of foreign value would, at least in part, close this door and simplify administration.

3. The recent erection of drastic trade barriers by Australia has caused a situated described by the London Economist of April 19, 1952, as follows:

The size of the import cuts and the speed with which they have been imposed mean that British manufacturers are left with appreciable stocks of specially designed pottery that cannot be diverted to other export markets, in spite of the Government exhortations to do so. It seems, therefore, as if the home market may at last obtain a release of decorated pottery in the form of these frustrated exports; even so, some members of the industry are doubtful of its ability to absorb more than a limited quantity.

My reason for mentioning this is so that you will know that any relaxation in the ban on sale of decorated china in England in the near future is for a special limited purpose and would not include the china covered in the discussion under item 1 above.

I would like to add in this connection, I call your attention to the confirmation in general of the situation I have described specifically in the case of decorated china from the United Kingdom by a previous witness with wide experience as a customs attorney dealing with this matter, Mr. Coburn, who said, and I quote:

Many of the delays which have occurred have, as has been pointed out, been due to the difficulties of ascertaining a market value in the country of exportation, that is, a so-called foreign value. With removal of foreign value as a basis of dutiable value and the other changes in the proposed section 13 calculated to simplify the determination of a proper dutiable value of imported merchandise, no reason would exist any longer for the interminable delays which now occur in obtaining appraisement action.

In conclusion I submit that the claim of the witness for the Staffordshire potters that

the repeal of foreign value would result in leaving the appraisement of our products up in the air

is contrary to the fact, that I have shown that this is properly descriptive of the situation as it is now under foreign value, which the Staffordshire potters desire continued, and I respectfully suggest that their demand that section 13 be amended as they desire or the entire bill be killed, is without merit and that it be rejected.

Senator KERR. May I ask now specifically what your recommendation is?

Mr. MARTIN. Our recommendation is that the bill be passed without the inclusion of the foreign value, which is now eliminated under the present form of the bill, sir. That has been eliminated under the present form of the bill.

Senator KERR. Is that all?

Mr. MARTIN. Yes, sir.

Senator KERR. We thank you for your statement.

Mr. MARTIN. Thank you, sir.

Senator KERR. Mr. Pinkussohn?

STATEMENT OF LEWIS A. PINKUSSOHN, JR., ASSISTANT
SECRETARY, CAMILLUS CUTLERY CO.

Mr. PINKUSSOHN. Mr. Chairman, I am Lewis A. Pinkussohn, Jr., assistant secretary of the Camillus Cutlery Co., and I live in New York City.

98600-52-12

I would like to thank you for permission to appear. As you know, Mr. Alfred B. Kastor, the chairman of our board, had intended to appear here before you. Mr. Kastor has not enjoyed the best of health for the past few years and he felt that the effort of a trip to Washington and an appearance before this committee at his age would be too much of a strain.

You will recall the testimony of Mr. Robert N. Kastor when he appeared before you on March 2, 1951, regarding the Trade Agreements Extension Act.

Senator KERR. I remember he brought some samples of cutlery, if I'm not mistaken.

Mr. PINKUSSOHN. That is right, sir; he had plaques on which he had fighting knives and pocket knives.

Senator KERR. That is right.

Mr. PINKUSSOHN. When Mr. Robert N. Kastor testified on March. 2, 1951, Camillus Cutlery Co. was employing 450 people. Then came Torquay-and a reduction in duties, as you Senators know, of 50 percent. This was almost the K. O. for Camillus.

The last payroll report for the week ending April 15, 1952, shows that we have only 317 employees, and if this so-called Simplification Act is passed and the marking proviso is deleted as has been suggested, our employment will be cut another 25 percent within 1 year-and within 3 to 5 years we may be driven out of business. It is to be noted that the town of Camillus, its bank, its property values, are all dependent on the Camillus Cutlery Co., as we are the only industry located there, a small suburb 9 miles west of Syracuse. Also, I would say that the majority of all the cutlery companies are also located in New York State, Pennsylvania, and New England, and so forth.

This remark is not said facetiously.

Mr. Kastor has told me that he has had 46 years of continuous experience in this business, and it is his well-considered opinion that this unfortunate situation will ensue if the marking proviso is deleted.

Senator KERR. If what?

Mr. PINKUSSOHN. If the marking proviso is deleted from our particular section, paragraph 354, dealing with pocket knives, and 355, dealing with household cutlery.

He feels that his opinion is worthy of more respect and attention than the opinion so glibly expressed in the hearings before the Committee on Ways and Means by the Treasury Department, namely, Messrs. John S. Graham, Assistant Secretary, and Philip Nichols, Jr., assistant general counsel.

Senator KERR. You take the position that their lack of experience either in the production and marketing of these items is a matter that should be given consideration in appraising the value of their testimony?

Mr. PINKUSSOHN. Agreed, sir.

Their testimony in our opinion was specious, misleading, and fatuous.

The crux of the matter can be very briefly stated.

It is proposed to delete from paragraph 354 the following and I quote:

Provided further, That all the articles specified in this paragraph, when imported, shall have the name of the maker or purchaser and beneath the same the name

of the country of origin die-sunk conspicuously and indelibly on the shank or tang of at least one or, if practicable, each and every blade thereof.

This exact wording of this proviso has been a part of the Tariff Acts of 1930, 1922, 1913, and 1909.

Its main objective was to prevent deceit and fraud so that the purchaser of pocket knives would know not only the name of the country but also the name of either the maker abroad or the purchaser-and this was itself a guarantee of a certain standard and quality as no maker or purchaser would let his name appear on a corrupt piece of merchandise. That was just common sense.

It is worth while noting that there is not a single manufacturer of cutlery in England, Germany, or Japan of any note or repute who does not understand to the fullest extent these branding requirements. It is only those who would transgress our customs laws who plead ignorance.

I would also like to state that it is no hardship, either abroad or domestically, to put your name or your brand or country of origin on your merchandise. I know of no domestic manufacturer, whether he turns out the most expensive item or the cheapest item, that will turn out any merchandise whatsoever without his name or brand conspicuously die-sunk on the tang.

Senator KERR. You figure if he is so ashamed of it that
Mr. PINKUSSOHN. Something must be wrong with it.

Senator KERR (continuing). That maybe we ought to look on it with some caution?

Mr. PINKUSSOHN. That was the original reason, I believe, for putting the marking proviso on the statute books in the customs law of 1909.

In conclusion, we wish to state that we are not against bona fide simplification of customs administration and procedures. We are, however, definitely opposed to section 3 of the bill which does not simplify but which repeals the special marking requirements for cutlery in paragraphs 354 and 355 and vitally affects the livelihood of American cutlery workers. I ask that the letter which Mr. Alfred B. Kastor wrote to each Member of the Senate, dated April 15, 1952, be made a part of the record without my taking the time of your committee to read it.

Senator KERR. Very well.

Mr. PINKUSSOHN. That is all I have, sir.

Senator KERR. Are you familiar with section 11 of the proposed bill?

Mr. PINKUSSOHN. No, sir; I am not.

Senator KERR. Which raises the $1 exemption in existing law to $10 on merchandise received from a foreign country by mail?

Mr. PINKUSSOHN. I am not familiar with it, sir.

Senator KERR. I would think maybe you would have some concern with that section.

Mr. PINKUSSOHN. No, sir; we do not.

Senator KERR. All right, Mr. Pinkussohn.

Mr. PINKUSSOHN. We thank you.

(The letter previously referred to, from Mr. Alfred B. Kastor, is as follows:)

CAMILLUS CUTLERY CO.

Camillus, N. Y.

NEW YORK, N. Y., April 15, 1952.

Under the guise of a bill to simplify customs administration and procedures, H. R. 5505 has been passed by the House. This omnibus bill is a misnomer. It would in fact destroy the tariff regulations that created the strength of the cutlery industry.

Because this bill is now before the Senate this letter is sent to you.

One of the chief objections to the bill is its repeal marking provisions that have been in the tariff law for 30 years. This is not simplification but destruction. The marking requirements specify that the maker's or importer's name along with the country of origin must be indelibly die-sunk on the tangs of all knife blades. This information protects the consumer. It accords with the principle of honest labeling of merchandise which began with the Pure Food and Drug Act and has extended to the Wool Products Labeling Act.

This information for the consumer also protects the domestic manufacturer in marketing goods of superior quality. If it is allowed to be rubber-stamped or lightly etched, it can be easily removed and a deceit will be practiced on the consumer. Is this simplification?

The bill goes further. It would eliminate the name of the foreign manufacturer or the importer and thus deprive the purchaser of a guaranty of redress in the case of inferior merchandise. Yes, this is simplification with a vengeance. The cutlery industry of this country is a creation of the Tariff Act of 1890. The marking provisos came as the studious result of years of experience and thought. They were embodied in the Tariff Act of 1909, retained in the tariff of 1913, again in the tariff of 1922, and again in the tariff of 1930. Under these laws the industry has lived and grown, developing techniques that enabled it to stand alongside other essential industries and produce large quantities of war material such as essential pocket knives, surgical knives, and fixed-blade fighting knives at the beginning of World War II.

Even now the ideas that stemmed from the Torquay conference and slashed cutlery duties 50 percent have resulted in a flood of imports from Japan, Germany, etc., and caused grave unemployment in the cutlery towns of America. The new proposal would wipe out this reduced production and make them ghost towns in a few years.

And yet, when this bill was reported by the House Ways and Means Committee, it was spuriously described as “entirely procedural in nature."

There is time to stop this last blow of destruction. If some customs procedures need to be improved, let them be studied carefully, after the elections. Let us not be hoodwinked by the false face of vicious legislation.

Very truly yours,

CAMILLUS CUTLERY Co.,
ALFRED B. KASTOR,

Chairman of the Board.

Senator KERR. Mr. Mercer, sit right down and make yourself comfortable.

STATEMENT OF WALTER J. MERCER, PRESIDENT, HUDSON

SHIPPING CO., INC.

Mr. MERCER. Mr. Chairman, my name is Walter J. Mercer. I am president of the Hudson Shiping Co., Inc., customhouse brokers and foreign freight forwarders, and I am a director in the American Chamber of Commerce for Trade With Italy, Inc., for whom I am now making this statement.

I have already submitted a statement which I would request to be incorporated in the record.

Senator KERR. Very well.

Mr. MERCER. This is in connection with some oral remarks I will make now.