TABLE 2.-Vegetables: Monthly shipments from Florida, imports from Cuba and Mexico, and total shipments and imports, November to June, 6-year averages, 1931-32 to 1936-37-Continued 1 Shipments from States other than Florida and imports from countries other than Cuba and Mexico, in carlot equivalents. 2 Less than 2 car. 3 Months of reduced duty on imports from Cuba. 4 Months of reduced duty on lima beans from Cuba. Senator PEPPER. Now, Mr. Chairman, answering the question that you put, I am glad that you made that suggestion. The interesting thing is that that new tomato business that came to the tomato growers of this country did not go to the Florida tomato growers or else it would have been reflected in the figures that I gave here a moment ago, because I gave the total Florida output. Now, Mr. Chairman, I am not here to say that maybe the United States as a whole-maybe other sections of the United States may not have profited by this trade agreement with Cuba, but I am here to say that the trade agreement with Cuba has had a detrimental effect upon the vegetable industry of my State, and I am representing that State and I am protesting to this Committee and to the Congress that the prosperity of the remainder of the United States should not be taken out of the economic hide, as it were, of the vegetable growers of the State of Florida. Senator CONNALLY. How can we rectify that? Have you any amendment, Senator? Senator PEPPER. Well, I will say to the Senator from Texas that I have not a specific amendment, because I have been troubled by this whole problem and troubled in an honest effort after consulting with the departments, to find a way that the detriment in some satisfactory manner could be removed. The same situation exists with respect to competition from Mexico. I think they pay the full tariff that has been prescribed in the Smoot-Hawley Tariff Law. There has been a constant increase in the quantity of those commodities that have come into this country in competition with what is grown in the State of Texas which the Senator so ably represents, and in competition with other tomato-producing areas of this country. What I want to do is to submit to the judgment of this Committee the question as to whether or not we are not willing to formulate as a part of the Trade Agreement Law the principle that there must be some limitation upon the degree of competition that we will allow in the importation of agricultural and horticultural commodities into this country in competition with the production of those commodities. in this country, unless it is a commodity with respect to which there is a scarcity in this country's production. Senator CONNALLY. What would you think of the quota system? Senator PEPPER. I will say to the able Senator from Texas that that is the principle that should be established in this law. Senator CONNALLY. In other words, that they could not increase the volume? Senator PEPPER. I am not so much interested in the amount of the tariff, because it is entirely possible that the tariff may not be the answer to the question, unless there is actually a prohibitory tariff, but I have a feeling, Mr. Chairman, that when the Department entered into this trade agreement with Cuba that they were not aware of the fact that we in Florida, for example, were in substantial or appreciable competition with Cuba in the production of these eight vegetables that are described in that trade agreement. They thought that it was the season when Florida was not producing anything of that character to speak of. Now, I say either that they were wrong in the facts, because I have shown you the figures, or else they deliberately decided that that much competition was not harmful to Florida, or they deliberately determined that even if it were harmful to Florida, it was desirable in the general public interest to let it occur. If an error was the basis of their activity, it ought to be corrected when the facts are disclosed, and if I have been persistent in anything since I have been here, it has been in an effort to disclose those facts to the Departments of our Government. The second day I came to Washington in 1936, I went over to the State Department and I got an interview with the State Department and protested about the trade agreement with Cuba, which has actually been detrimental to the vegetable producers of South Florida, and ever since I have been here I have tried to get a declaration of principle to find which one of those things was the basis of their determination. I say if there is an error of fact, it should be corrected when the error is disclosed. If they determined that this competition was not deterimental to the State of Florida, and we have shown facts, that fact should be taken appropriately into consideration. If they take the position that it is in the general interest that this agreement has been executed and we are going to have to pay the price of it, I protest against discriminating against any segment of this country for the remainder of it. Senator CONNALLY. How could they reduce any tariff without hurting those who produce that particular article in the United States? Senator PEPPER. I think the principle will have to be that unless there is a shortage in production of that commodity in this country so that the public interest requires that there be a larger volume of that commodity, we should not allow any substantial quantity of that commodity to come into this country at a time, at least, when it is being produced by the producers of this country. If we do that, you cannot avoid the logical conclusion that a part of the prosperity that we reap from that policy comes from a part of our own people, and we might just as well say that we are going to take a part of the wealth of Texas and appropriate it to the benefit of New York or Michigan as to carry out the principle that has that inevitable effect. So that, what I want to address myself to is the hope that the Committee can formulate some appropriate policy that will be appropriate not only to such an agreement as that between the United States and Cuba, but will be appropriate to a situation like that between the United States and Mexico, or even the United States and some of the other off-shore areas, so that there will be some principle that will determine the degree to which we will allow competition with what we produce in this country. I am perfectly willing to make it into a general principle of the law directing the Department of Agriculture, for example, to determine whether or not in the period that it is imposed that imports of agricultural or horticultural products will be allowed in this country when there is not a substantial competition from domestic producers. If there is, then limit the quantity that may come in. If there is not-it may come in at an off season as far as our own domestic producers are concerned-and if so, well and good. Nobody can have any objection to that, but we ought not to allow the gates of this country to be opened to a flood of agricultural or horticultural commodities when our people at home here are trying their best to find a market for what they are growing in the commodities of this character. I realize that the time of the committee is limited, and I apologize for not, perhaps, giving the committee more light upon this subject. I have preferred to present the principle to the committee rather than any particular language for an amendment, but I do earnestly urge upon the committee that it will take proper counsel and that it will at least put into this trade-agreements law the principle that shall determine the degree to which and the circumstances under which agricultural or horticultural commodities may be allowed to come into this country at a time and under circumstances which will put them into competition with the production of the commodities of that character by the producers of this country. I thank the chairman. The CHAIRMAN. We all can attest the fact, Senator, that you have been diligent about this matter. I am interested deeply, and of course Senator Connally is too, because I was raised in a town that raises and sends out about 150 carloads in the season into the market, and our trouble has been with the Canadian situation, and I think that this committee has done a great work in reducing the tariff on tomatoes and some other vegetables in the Canadian agreement. Of course, it is a hard and delicate situation did not hurt Canada Senator CONNALLY (interposing). That did because they do not raise any tomatoes. The CHAIRMAN. They have hothouses. Senator BROWN. They raise a good many tomatoes in Ontario in July and August. The CHAIRMAN. The trouble is that they come in and glut the market at one time. Texas tomatoes may come in at the same time as Mississippi, but Florida's comes in a little earlier than Texas, except the lower part, I think. Senator BROWN. How do you compare 19 million pounds of tomatoes shipped into Canada from the United States to 6,000 cars of tomatoes coming in from Cuba here? How do they compare? I am unable to translate the pounds into cars. Senator PEPPER. Frankly, I don't know. I am sorry that I cannot tell you. Senator BROWN. In other words, do the tomatoes that we ship to Canada substantially equal the carloads that we get from Cuba? Senator PEPPER. Senator, I am sorry that I cannot answer that question. I know only that the statistics indicate here that, Florida at least, has not been getting any new market in Canada or our production would have been increased. I will try to get that information for the Senator. (It is later stated that there are 20,000 to 30,000 pounds of tomatoes to a carload.) Senator PEPPER. The Chairman spoke a moment ago very effectively about this question of glutting. Here is what happens to Florida. The way the Cubans ship into the New York market, and that is the one that we are primarily interested in, of course, is by shipboard, naturally. A shipload of tomatoes, for example, will come into the New York market, on, I think, Monday, Wednesday, and Friday. A particular shipload of tomatoes, we will say, comes in to New York on Monday. The market is glutted. Meantime, our carloads of tomatoes come dribbling in from Florida. On Tuesday, the produce dealers in New York say, "There is no use to load up today; there is going to be another ship in here from Cuba tomorrow.' Then on Thursday they say the same thing, "There will be another Cuban ship in here tomorrow." And Friday afternoon and Saturday they will say, "We will go over the week end and wait for another Cuban ship on Monday." I approached this thing originally with a view to trying to get the producers in Florida and the producers in Cuba to come to some sort of an intelligent understanding so that they would ship their products so as not to glut the market. However, the way it works out in practice is that in the first place, Cuba is producing tomatoes cheaper than we; secondly, they have a very fine commodity, and thirdly, it goes into the market in tremendous quantities all at one time. The inevitable effects are depressing and result in the glutting of the market to which our people are trying to get access. Mr. Chairman, you have been very kind. The CHAIRMAN. The figures show that for the four seasons before the Cuban agreement was made, the price average was 3.8, and that on the four seasons since the agreement has been made, the price has increased to 4.3. Senator PEPPER. That probably is true, Mr. Chairman. The CHAIRMAN. That is only as to prices. Senator PEPPER. Yes; that is as to prices. That is part of the general spread in prices, you know, that has been going on since 1932 and 1933. I thank the committee, and I will just say this in conclusion, Mr. Chairman; I believe the people of this country would not complain, and in fact would appreciate our Government working out any kind of bargaining by which we can exchange the products that we do not need for some products with some other people that they do not need, or if we can supplement their economy with excess from ours, and supplement ours with excess from theirs. However, we must, in my opinion, define and limit the degree of competition with our local people if we are not going to provoke from the country a very determined and eventually successful remonstrance against the whole bargaining idea. Therefore, as a friend of this administration and as a friend of the trade-agreements law, which in the long run in general has done much good, I hope the committee will find some means of alleviating and removing these points of conflict so that that remonstrance will not come in the future. Senator BROWN. The Cuban treaty was the first treaty? Senator PEPPER. Yes, sir. Senator BROWN. When did that become effective? Senator PEPPER. In the seasons 1934-35 for the first time. Senator BROWN. It is subject now to the six months' termination? Senator PEPPER. That is right. Senator BROWN. It would seem to me if I were a member of the committee of the State Department that handles this matter that I would be convinced by your argument-I think you have made a splendid argument. You have, I take it, presented that argument fully to the State Department and have gotten no relief? Senator PEPPER. I have repeatedly presented it to the State Department, and the Department of Agriculture, and they have been just as courteous and gracious and considerate as they could be in listening to me, but they simply have a different idea about the subject. Senator BROWN. You cannot get any relief there? Senator PEPPER. That is right. As I told a gentleman this morning, it reminded me of the story I heard about Lord Hastings, in which Lord Elton, Hastings' counsel, would continue to make objections to questions, and the Lords would solemnly rise and go out into another room and decide on the objection and come back and sit down and rule. After the case had continued for several years, some wag remarked, "The court moves, but the case stands still." The CHAIRMAN. Thank you very much. The committee has received a letter from the Undersecretary of Commerce, Mr. Noble of the Department of Commerce, expressing the vital interest of that Department in this trade agreements program and giving its unqualified approval to the extension of this program. That communication will be inserted in the record, without objection. (The letter is as follows:) Hon. PAT HARRISON, Chairman, Committee on Finance, DEPARTMENT OF COMMERCE, OFFICE OF THE SECRETARY, United States Senate, Washington, D. C. MY DEAR MR. CHAIRMAN: As the Government agency specifically charged by the Congress with the responsibility for promoting business, both domestic and foreign, the Department of Commerce is vitally interested in the reciprocal trade agreements program. Not only has the Department actively participated in the formulation and negotiation of the 22 agreements concluded under the authority of the act of 1934, as extended, but through its constant and intimate contact with the various branches of American business, it has found itself in an exceptional position to appraise their practical results. A careful analysis of the evidence that has been assembled by this Department, whether from private sources or through its own exhaustive studies, points to the definite conclusion that trade agreements have made a notable contribution to the well-being and prosperity of our country. As the artificial barriers that were so seriously obstructing its development have been gradually lowered through the negotiation of trade agreements, a progressive revival has taken place in our foreign trade, the value of which rose from $3,125,000,000 in 1933, the last year before the Trade Agreements Act was approved, to $5,496,000,000 in 1939. This revival has constituted a very important factor in broadening and stimulating our domestic markets and in providing increased purchasing power and employment. |