Mr. GLASS. To a considerable extent, yes.

Mr. EBERHARTER. So, they gave you the impression that this was somewhat of a body of experts.

Mr. GLASS. I would go along with that.

Mr. EBERHARTER. But you still think the Congress as so constituted, could pass on each individual industry?

Mr. GLASS. No, I would not ask you to, and I would not subject you to the burden of detail. I would merely ask you to examine principles and rules on matters of principle and policy.

Mr. EBERHARTER. The tanning industry was very profitable during the war period, was it not?

Mr. GLASS. Profitable in relation only to its visible record of unprofitability in the last 20 years; not profitable in relation to earnings by other industries.

Mr. EBERHARTER. What is its profit position since VJ-day, pretty good?

Mr. GLASS. Some sectors of the industry are right now doing well, for example, the producers of glove and garment leather; the producers of shearling, certain other types of leathers, are in the doldrums today. Producers of your sole leathers are not doing so well; producers of upper leathers are doing relatively well.

Mr. EBERHARTER. Is the tanning industry contemplating sending representatives to the Geneva conference during the process of these negotiations?

Mr. GLASS. We are not. We thought it would be desirable, but we noticed that in the press statements and releases, the conference proceedings are to be secret, and lobbyists and other representatives of industry are not to be encouraged, and not wishing to be in the position of a lobbyist at Geneva we are not intending to be represented there.

Mr. EBERHARTER. I think that was a wise decision. Thank you very much, Mr. Glass.

Mr. CURTIS. I happen to come from a State which produces and finishes more cattle than any other State in the United States. Do you favor a reasonable protection on hides to the end that American cattle raisers might have a reasonable price for their hides?

Mr. GLASS. I am trying, sir, to frame an answer as diplomatically as I can. We have always avoided taking any position since 1930 on the hide tariff, that is, the 10 percent duty on hides, which was subsequently reduced to 5 percent. Inasmuch as the present duty is only 5 percent, we cannot help but feel that it has had very little effect insofar as prices are concerned. In the end we have always been an importing Nation. We would have to import hides regardless of the duty prevailing.

For that reason, we cannot help but feel that the question of the duty on hides does not have any great significance so far as price is concerned.

Mr. CURTIS. It is true that in years gone by American farmers have shipped a hide to some buyer in hides, maybe direct to a tanner, and have failed to get the cost of its transportation, and have been billed for the freight that was in excess of the sales price of the hide. That is not a wholesome thing in the economy, nor is it fair.

Mr. GLASS. That happened in 1932 when the price of hides was 31⁄2 cents a pound in certain grades. Well, that would hardly pay for the cost of transportation and so forth. But the same thing was

true of livestock and leather, and I recall that a lot of shoes had to be produced and sold ultimately at prices not sufficient to return the cost of production. In other words, it was a phenomenon.

Mr. MARTIN. I understood Mr. Cooper to ask a question a moment ago whether or not quotas were included in reciprocal trade agreements, and I just wanted to know whether by that Mr. Cooper was implying that they are an essential part of trade agreements.

Mr. COOPER. Do you want to ask me a question? I can tell you that quotas and classifications and all those things, are included in trade agreements.

Mr. MARTIN. They are an essential part of them.

Mr. COOPER. They are part of the trade agreement that is worked out with the other country.

Mr. MARTIN. I asked very much the same question of Mr. Clayton the other day, and after he had admitted that some quota systems would be approved, Mr. Clayton went on with this statement, and I quote him from page 283 of the hearings, part one:

The intent is to get away from quota systems as much as possible. As I have explained before, Mr. Martin, a quota system has almost uniformly been substituted by foreign countries as a means of regulating their imports for the tariff system. We in this country generally give the tariff system that, but foreign countries have gone into the quota system and exchange control system a good deal, which is much more effective as a means of eliminating imports, and thus destroying foreign trade than the tariff system. Now, our main objective here in the ITO is to try to get away from that quota system and to use the tariff system again.

I just wanted to make that point to keep you from relying too much upon the quota system as your future remedy for any ills that may come your way.

Mr. GRANT. Mr. Chairman, I want to congratulate Mr. Glass on his most excellent statement, but I have no questions.

Mr. HOLMES. No questions, Mr. Chairman.

Mr. REED. Mr. Glass, I want to compliment you on your very clear statement with reference to your views on this trade agreement program, and I want to ask you now if you have any exhibits which

you wish to have go into the record.

Mr. GLASS. I have left those with the clerk of the committee for the distribution to the committee.

Mr. REED. I examined a very informative table

Mr. GLASS. If we may submit that for the record, sir.
Mr. REED. That is not in your main statement, is it?

Mr. GLASS. No, sir.

(The document referred to is as follows:)

LEATHER; A BASIC UNITED STATES INDUSTRY BECAUSE 140 MILLION AMERICANS WEAR SHOES

Foreign hides and skins are vital to the tanning industry. Over 75 million hides and skins must be imported to maintain production of leather and to keep Americans in shoes.

The United States is the world's largest buyer of hides and skins, spending about $75,000,000 a year in foreign markets. It has imported and requires millions of cattle hides, calfskins, goatskins, sheepskins, and other types of hides and skins.

For more than a generation Americans have consumed more than three pairs of shoes per capita each year. This standard of living was made possible by the largest tanning industry in the world, with plants in 30 States, employment of 50,000 wage earners, an annual pay roll of $125,000,000, annual output exceeding $550,000,000.

The industry, in order to supply 140 million people with footwear and other leather goods, tans over 125 million hides and skins a year. To tan these hides and skins American tanners buy from areas all over the earth more than $10,000,000 worth of foreign tanning materials annually.

Of the total leather produced each year, 85 percent is used in the manufacture of shoes; 15 percent is used for all other leather goods.

The raw material needs of the United States tanning industry are supplied in part by domestic resources, but a large proportion always has been and must be imported. Unless foreign hides and skins continue to be available, the consumption of leather shoes in the United States cannot be maintained at essential levels. Leather is a vital military requirement. During the past war military needs took a substantial portion of all leather produced in this country. A strong domestic tanning industry is essential for America. This is impossible unless foreign hides and skins continue to be available to American tanners.

In the following pages the sources of United States hide and skin imports abroad are shown by countries. The character of United States trade relations with all these countries and the importance given to maintaining access to raw materials by the United States tanning industry are vital issues.

e-number of

Where our foreign cattle hides come from-annual imports, by sourceof hides, average, 1937-41

Where our foreign calfkins and kips come from-annual imports, by source-number

Where our foreign calfkins and kips come from—annual imports, by source—number of skins, average, 1937-41-Continued

Australia

New Zealand..

Total Oceania.......

British East Africa....

310, 000

559, 000

869, 000

283, 000

87,000

Union of South Africa....
Ethiopia....

Other Africa....

Total Africa.....

Total....

9, 000

25, 000

404, 000

3, 168, 000

Where our foreign goat and kid skins come from-annual imports, by sourcenumber of skins, average, 1937-41

Russia

Other Europe...

Total, Europe..........

Argentina

68, 000 1,050, 000

1, 118, 000

2, 329, 000 4, 074, 000 1, 380, 000

Brazil..

Mexico...

Venezuela.

758, 000

Peru..

733, 000

Haiti.

309, 000

Where our sheep and lamb skins and cabrettas come from—annual imports, by source—

Where our sheep and lamb skins and cabrettas come from—annual imports, by sourcenumber of skins, average, 1937-41-Continued

India..

Iran.

Arabia

Other Asia...

Total Asia...

Australia

New Zealand.

132, 000

41, 000

184, 000

237, 000

594, 000

1, 827, 000 11, 027, 000

SOME OF THE INDUSTRIAL PRODUCTS FOR WHICH LEATHER IS THE RAW MATERIAL

Consumer goods

Shoes, boots, gloves, garments, belts, work clothes, pocketbooks, luggage, wallets, furniture and automotive upholstery, harness and saddlery, athletic goods. Industrial materials

Transmission belting, textile rollers, buffers, aprons, mechanical products, gas meters, washers, gaskets and hydraulic equipment, straps, safety belts, lacing. Military articles

Boots, shoes, gloves, jackets, signal and instrument cases, safety belts, helmet linings, aviators' clothing, recoil mechanisms, scabbards, holsters.

(Source: Tanners' Council of America, New York 7, N. Y.)

Mr. JENKINS. I would like to ask this gentleman one other question and have it appear in connection with his statement. You were asked with reference to your appearance before the Committee on Reciprocity Information-let us get the mechanics of just how these hearings are conducted. As I understand it, you are called in before a committee?

Mr. GLASS. Yes, sir.

Mr. JENKINS. Is that a panel or just a one-man committee?

Mr. GLASS. It is a panel consisting of representatives of several departments who form the Committee on Reciprocity Informationthe Tariff Commission, War, Navy, Commerce, and State.

Mr. JENKINS. You know that that committee does not dictate the policy of the department that makes the trade agreements.

Mr. GLASS. We appreciate that fully; yes, we understand that the committee represents a sort of information-seeking body, and I have no hesitation in saying that as an information-seeking body they gave us completely fair treatment, and it was fully and completely patient with our presentation.

Mr. JENKINS. Yes. But, as I say, they just act as sort of an auxiliary committee that permits you to present your case, and will not have anything else to do but to give you courteous treatment. They have no right to dictate the policy and they do not indicate to you that they dictate the policy, and after you make the presentation you do not know what goes on behind the scenes.