and perhaps even more so, because they can change that from day to day. They can have one policy today and another tomorrow. Mr. REED. Is that true also with the tariffs? Mr. CLAYTON. Their tariffs? Mr. REED. They have a council, order in council in Great Britain, and if they find that some trade is operating detrimentally to them, this council can fix a tariff overnight, can it not? Mr. CLAYTON. I suppose they could, but orders in council in GreatBritain are resorted to very seldom, and so far as I know, almost never in times of peace. Mr. REED. In the event of these agreements, how long do you think it will be before you begin to feel the effect of these changes you propose to make in these various tariff deductions and so forth? Mr. CLAYTON. I think we should begin to feel them very promptly, Mr. Reed. As you know, our exports now have got up to over $10,000,000,000. That is what they were last year. A considerable part of that, of course, was UNRRA shipments, and shipments that were paid for by credits which were granted by the Export-Import Bank, and other agencies, but it is highly important to our economy that we continue those exports if we can. Mr. REED. How much do those exports amount to? UNRRA, for instance, how much is the total? Mr. CLAYTON. Over $1,000,000,000 last year. Mr. REED. How much? Mr. CLAYTON. Over $1,000,000,000 worth last year. Mr. REED. What was the extent of the credit? Mr. CLAYTON. It is impossible to testify to what extent foreign countries used their credits to pay for those imports into their countries, because so often the proceeds of the credits are intermingled with their own resources. As, for example, take the British loan. They drew, I think, last year, about $1,000,000,000. I am not absolutely sure. I think that is about the figure on that loan. To what extent they used that to pay for those imports, I do not know, because they had other dollar resources, of course. Mr. REED. To what extent, for instance, do we finance the exports? Mr. CLAYTON. We just do not know to what extent the foreign countries have done so. We do not know to what extent you could say that the exports were paid for with loans that we made. We know the loans we made all right, but it is not possible to say to what extent the proceeds of those loans were used to pay for our exports. Mr. REED. To what extent do you figure these exports will be paid for by imports from these various countries? Mr. CLAYTON. Well, we know exactly those figures for last year. We imported almost $5,000,000,000 worth of goods. Mr. REED. What was the character of the goods we imported? Mr. CLAYTON. Of all kinds of things. We imported very heavily certain metals and minerals, raw materials of different kinds. We imported a great deal of copper and lead and zine and things of that kind. Mr. REED. Could you give us some idea of the amount of agricultural products that came in? Mr. CLAYTON. I would be glad to do it. There is only one, I can tell you now, only one substantial item, and that was wool. That ran into big figures. Mr. REED. Could you give us approximately the figure? Last year we must have imported at least 700,000,000 pounds of wool, greasy weight, or about $300,000,000. Mr. REED. Have you any idea how much wool we have on hand, imported? Mr. CLAYTON. I understand it is something over 400,000,000 pounds of domestic wool. Is that what you mean? Mr. REED. How much imported wool have we got in this country? Mr. CLAYTON. I do not know. The Government would not have any. Private people would have stocks, but I just do not know what they amount to. But our Government has somewhere between 400,000,000 and 500,000,000 pounds of domestic wool. They are the purchases made by the Commodity Credit Corporation. Mr. REED. I would like to ask a few questions now to refresh my memory. Would you mind giving me the names of the South American countries and the Central American countries that we have agreements with? How many of those are there? Mr. CLAYTON. We have not got a full list, Mr. Reed. If you would give me just a moment, I think we can give you a pretty good list. Mr. REED. I would appreciate it very much. Mr. CLAYTON. This is perhaps not a complete list, but it is the principal ones. Mexico, Brazil, Colombia, Peru, Paraguay, Venezuela, and Argentina. I am sure there are some more. I will get a complete list, Mr. Reed, and insert it in the record. (The list is as follows:) South and Central American Countries with which the United States has concluded Mr. REED. What I want to know, if you can tell me, is to what extent do these countries that you named there depend upon the custom duties to support their governments, to carry on their governments? Mr. CLAYTON. Well, the present system of taxation in most LatinAmerican countries depends, to a considerable extent, on revenue derived from import duties. Mr. REED. Now, in those cases, will you put in a summary under each one of those South American countries, the extent to which they do depend upon custom duties, import duties, for the support of their government? Mr. CLAYTON. Well, if we can get the information. If we have the information here in Washington, I would be glad to get it for you and put it in the record. Mr. REED. Thank you. I would appreciate that, because I would just like to know. (The information is as follows:) Revenues of American Republics, showing total revenues and revenues from customs duties 1 Actual receipts are shown where available. Otherwise budget estimates of anticipated revenues are shown. * 8 months. Mr. REED. Now, maybe you have the answer now? Mr. REED. Now, give me a little summary of each of the South American countries, showing the number of items on which they reduced their tariff under the trade agreements. Mr. CLAYTON. Yes, sir. Mr. REED. And the summary of those rates that were simply frozen, not changed. Mr. CLAYTON. We will do that. Mr. REED. And I would ask you to give me, if you could, that information, because I think it is around $5,000,000,000 from 1937-38 that 60 countries, all told, collected from imports out of a total budget of $25,000,000,000 in custom duties to carry on their respective governments. Mr. CLAYTON. What was that? Mr. REED. Maybe my figure is way off, but I thought you would have those figures. Mr. CLAYTON. We will get them for you. Mr. REED. I just wondered if the tariffs were lowered so that we took away some of those import duties from those countries that they require to support their government. How do we make that up, that loss to them? Is it in loans or just how? Mr. CLAYTON. They have other means, of course, of collecting their taxation. Chile, for example, imposes a very heavy tax on the production and exportation of things like copper and nitrates, and some countries have export taxes as well as import, and it is expected that if they reduce their tariffs on imports, their exports should increase materially, and they will get greater taxes from the exports. Mr. REED. And if we took too much of their money by getting concessions out of them or reductions of the duties on their imports, then they would have to make it up by imposing higher export duties on such of those articles that are coming into our trade here, and of course we would have to pay that extra tax, would we not? Mr. CLAYTON. No, sir, that tax is charged in the country of origin. of the exports and is paid by the exporter, and he is very seldom able to add it to the price because of competition with other countries. And also if they reduce their taxes on imports, in other words, their tariffs, they should obtain a larger volume of imports so that they would collect the reduced tax on a larger volume of goods and in a considerable measure make it up in that way. Mr. REED. Well, I would like to have all of the information that you have along the lines that I have questioned you for the record. What manufactured items exported are most likely to be affected by the trade agreements? Mr. CLAYTON. Oh, there is a vast volume of things, Mr. Reed. It would be difficult to tell. Things like automobiles, refrigerators, radios, office machines, business machines, and all kinds. There would be a great volume of commodities. But the class of exports that is more vitally involved in this whole program is agricultural. We exported last year over $3,000,000,000 worth of agricultural products. Mr. REED. Pardon me right there, Mr. Clayton. I am very much interested in that. Will you tell me, so far as you can, just what the character of those agricultural products were? Mr. CLAYTON. Yes, sir. Mr. REED. Was cotton one of them? Mr. CLAYTON. Cotton is one of them. The principal one is what, or let us call it grain, because wheat and corn and rye and oats are all in there. And tobacco, if I remember correctly, accounted for over $400,000,000. Dairy products and eggs accounted for $450,000,000. The biggest one, as I say, was grain. We expect to produce in the United States this year,1,200,000,000 bushels of wheat alone, and we can only eat half of it. Mr. REED. How much of those exports are being paid for by the United States? Mr. CLAYTON. Well, as I said a moment ago, if I remember correctly UNRRA shipped about $1,000,000,000 worth of goods from the United States last year approximately. And, of course, that was a United States contribution and then we made some loans, of course, and to some extent, the proceeds of those credits were used to pay for those exports, but just to what extent, I cannot say. Mr. REED. If you have it, will you put in the amount of the loans? Mr. CLAYTON. Well, to have something that is comprehensive, I would not only have to put in the amount of the loans, but I would have to put in the amount that the countries drew in 1946 on the loans. You understand, many of these credits are made and not utilized maybe, for two or three years. I would be glad to put in the loans that the Export-Import Bank made in 1946, and as near as I can get it, the amount that was drawn on those loans by the borrower. (The information is as follows:) Summary of loans and authorizations of Export-Import Bank during 1946 1 The obligor is not in every case the Government of the country named. Source: Export-Import Bank of Washington, third semiannual report to Congress for the period JulyDecember 1946. Mr. REED. To what extent have you paid a subsidy to get rid of, some of the agricultural products that you have sent abroad? Mr. CLAYTON. The only subsidy I think we paid in 1946 was on cotton and that was, roughly, 15 percent. Roughly 15 percent of the value. Mr. REED. About how much would that be? Mr. CLAYTON. Well, I think that the cotton exports came to between $450,000,000 and $500,000,000, so that we probably paid a subsidy of $60,000,000 or $65,000 000 on cotton exports. Mr. REED. Could you tell me, Mr. Clayton, why those exports were so large, cotton and wheat? Mr. CLAYTON. The cotton exports were small as compared with prewar. The wheat exports or grain exports were large because the countries of Europe which bought most of the grain had droughts and |