CTP41921 96 "To Foster the Trade and Welfare of New York” GREATER NEW YORK Bulletin of The MERCHANTS' ASSOCIATION of New York VOL. X NEW YORK, MONDAY, OCTOBER 17, 1921 No. 37 Fight for Foreign Trading Zones Is Renewed The Merchants' Association, Which First Originated the Idea of Establishing Free Zones in the United States, Endorses the Free Zone Bill Introduced in Congress by Senator Wesley Jones, of Washington, and Will Work for Its Enactment The Merchants' Association, both on its own account and as one of the members of the National Free Zone Association, is renewing its fight for the establishment of Foreign Trading Zones in the ports of the United States. Senator Jones' Bill Approved In pursuance of this plan, Mr. S. C. Mead, on behalf of The Association, has written the following letter to United States Senator Wesley Jones, Washington, in support of the Free Zone bill which he has introduced in Congress: "The Merchants' Association of New York is in favor of the enactment of S 2391, the bill introduced by you authorizing the inauguration and operation of Foreign Trading Zones in the ports of entry of the United States. The Association believes that the enactment of this bill in its present form is desirable, even though manufacturing in the Foreign Trading Zones is not specifically authorized. Foreign Trade Committee Acted "The Merchants' Association of New York will be glad to lend all possible assistance in your efforts to secure this legislation. We would appreciate a letter from you telling us the status of the measure and what we can do to aid in bringing about its enactment. Any suggestion you may send to us will be cordially appreciated." Will Meet in Rome The Council of the International Chamber of Commerce sitting in Paris has adopted the practice of the United States Chamber of Commerce for submitting questions at issue to a referendum of subsidiary organizations. ↓ The Administrative Commission, of which Mr. Frederick P. Keppel, Administrative Commissioner of the United States Chamber of Commerce in France, is the American member, was instructed, on the suggestion of Mr. Edward A. Filene of Boston, to prepare the questions and suggest the procedure for the first referendum. The next Congress of the International Chamber will be held in Rome in the middle of September, 1922. An Executive Commission of fifteen members was constituted under the amendment to the constitution of the Chamber adopted at the annual Congress of the Chamber in London last June. M. Clementel of France is Chairman of the Executive Commission, and Mr. J. H. Fahey of Boston is the member for the United States. Spain and the South American members combined on one representative. Merchants' Association of New York approve this bill in its present form and that it give all proper support to efforts being undertaken looking toward its enactment. Senator Jones has announced his intention of bringing about the enactment of his bill as an amendment to the pending Fordney tariff bill, which is now before the Senate Finance Committee. Senator Jones' Bill Provisions and Application of the Free Zone Measure An analysis and explanation of the Foreign Trade Zone bill introduced by Senator Jones, of Washington, have been made by Mr. Henry M. Robinson, formerly Commissioner of the United States Shipping Board and now a banker in Los Angeles. First Proposed by This Association The Merchants' Association first proposed the establishment of Free Zones in the ports of the United States for the promotion of foreign trade. It sent a representative to Europe to study the operation of Free Zones there and, upon his return, submitted his report to a This letter was written after The As-referendum of its members which resociation's Committee on Foreign Trade, sulted in a declaration favoring Free of which Mr. Lucius R. Eastman, is Zones by a large majority of the memChairman, had given careful study to bers voting. the Jones bill. The Committee voted Other commercial organizations, parunanimously to recommend that The ticularly those of New Orleans and San PROVISIONS OF SENATOR JONES' FREE ZONE BILL Francisco, became interested and The the profits of our merchants and the, greatly modified, unless some method is National Free Zone Association was earnings of American labor, itself. formed in the offices of The Merchants' Several bills have been introduced to carry out the free zone idea and Mr. Robinson's speech, which was delivered before the American Bankers' Association, in annual convention in Los Angeles, was devoted to Senator Jones's bill which, as amended, does not provide for manufacturing in Free Zones. What the Bill Does devised that will permit a world trade of merchandise in and out of our imWhy Exporting Is Necessary portant ports of entry without the de"There is appearing from time to lays and expense attendant on our prestime in certain publications the sugges-ent methods of operation. tion that most of our products are con- "It is true that under the present law sumed at home and that only about one- imported merchandise may be impoundseventh is available for export, and, ed in bonded warehouses and withdrawn hence, that our foreign trade is a rela- for transhipment, or may be impoundtively unimportant factor in our na-ed, withdrawn and manufactured and tional prosperity. then transshipped in foreign trade with "Accepting these figures as true, a drawback of the customs paid. This economists generally agree that a sur- plan was intended to meet the needs of plus is the controlling factor. Is it not, world trade, but is nearly inoperative therefore, reasonable to assume that it and utterly fails of accomplishing the is the backing up of our manufactured main purpose, in that the time conAfter pointing out that the Jones bill, surplus and our inability to sell abroad sumed in vessel delays and in the unas now amended, provides necessary that has brought about our unemploy- winding of red-tape militates against machinery for the creation of foreign trade zones in, or adjacent to, American "Since the beginning, any nation that ports of entry, and authorizes the Sechas engaged, with any appreciable deretary of Commerce to grant to States, gree of success, in international communicipalities and their legal subdivimerce has been either on a free trade sions the privilege of establishing such basis, or has maintained one or more zones, Mr. Robinson summarized the provisions of the bill, and pointed out that, whereas, under the terms of the For National Defense bill, both foreign and domestic mer"For years, however, we, as a Nation, chandise may be brought into a Free have maintained a high tariff, and most Zone and there be broken up, assem- of the time a very high protective tariff, bled, mixed with foreign or domestic and, for half a century our flag has been merchandise or otherwise manipulated a comparative rarity upon the seven for re-export, direct manufacturing, as such, may not be carried on within the proposed districts-this in order to meet ment situation? Free Ports or Free Zones. seas. such an operation. Would Minimize Port Delays "If it be true that the cost of operation of our merchant ships is to be greater than that of the important competing nations, some method must be devised to balance that cost, and the greatest waste in the shipping business is loss of time in ports, due to the administration of complex laws and regulations-regulations, within the provinces of many different departments. "In other words, the elimination of port delays would be of tremendous economic advantage, for it is recognized "Came the Great War, and demon- that successful ship operation depends, the wishes of interior communities and strated beyond cavil the need for the to a great degree, on keeping the ship to allay their fears as to seaboard manufacturing competition. No Payment Required "Under the terms of this act," he con tinued, "no duty is to be applied to merchandise delivered from ship to wharf within a free zone unless some part, or all, of it is taken out for domestic consumption, at which time it will pass through the Customs House and be subject to regular duty. time protect our own domestic markets from a flood of cheaply manufactured European and Asiatic goods. maintenance of a merchant fleet, if, in "The Great War also demonstrated nations and their dependence at sea. "A Free Zone would permit the prompt unloading of a ship within the boundaries of the Zone without any of the long delays that grow out of the Customs regulations. If any part of the upon cargo is intended for domestic consumption, this merchandise will be passed "Since the maintenance of a merchant from the Zone through the Customs fleet is obviously predicated on world House instead of holding the ship until trade, it is evident that a high pro- all the merchandise is checked and custective tariff, world trade, the mainte-toms paid. nance of a merchant fleet with the financial and commercial accompaniments of those operations, are incon Cost of Operation "It is to be recognized that ships "In other words, we may, within certain districts within our ports of entry, be a free trade nation and at the same sistent, but experiences of European other than those under our flag will nations show conclusively that a modi- have the same advantage in our ports. fication of this inconsistency can be but it is fair to assume that ships under brought about without definite injury to our own flag, through a period of time, "It is axiomatic that, for the protec- the principles involved in a protective will touch more often at our ports than tion of the American manufacturer, a tariff. method must be provided for the maintenance of a merchant marine which Protection and Foreign Trade ships under other flags, and, to that extent, at least, there would be a factor for improvement in the cost of the operation of American vessels. will carry abroad the surplus of Ameri- "In fact, if the feeling continues to can manufactured goods; otherwise, grow that we should engage in world "Another great advantage in the these goods must continue to back up trade and maintain a merchant fleet, operation of our marine would be the upon our own markets and thereby re- as a necessary corollary, the principle fact that so-called 'triangular voyages duce the earnings of our manufacturers, of protection must, of necessity, be could be made and cargoes moved to THIS ASSOCIATION on rail terminals already overloaded, DIRECTORS ELECT ENDORSES JONES BILL and would result in an uneconomic our ports, only a part of which would FOURTEEN MEMBERS Leading Houses and Firms Are "In other words, a fairly general distribution of these Free Zones should be advantageous to the whole people and not of unfair profit to a limited number. "Another thing, it is only through the ACTION TAKEN LAST THURSDAY adoption of a Free Zone policy that the protectionist, the ship operator and the foreign trader can meet on common bill is attempting to do is to carry out ground, and really all that the Jones scientifically what we are now doing most unscientifically through our bonded warehouses." "The problem of American ships has been that, while we have merchandise for export shipment, only too often it is necessary for the ships to return in ballast. The British, a free trade nation, on the other hand, until recently have been able to fill their unoccupied space in their outward bound ships with coal for foreign countries, and for bunkering, returning with cargoes of commodities from foreign countries-cargoes partly for home consumption and partly for transhipment to other countriestranshipments made without any regulatory practices that result in serious Events Secured for New York City delays. This, too, because of Free Port Zones, was equally true in the case of Germany before the war. Favored by Shipping Men NEW CONVENTIONS During September During the month of September the National Association of Brass Manu- "The establishment of Free Zones for America has been under discussion for many years. Shipping men, naturally, have been strongly in favor of it. They take the position that the principal advantage to the merchant ships is the New York Wholesale Grocers' Associability to bring in full cargoes, or atation, February, 1922. least larger cargoes than present condiNational Association of Men's Straw tions allow, the bulk of which will be Hat Manufacturers of America, March, for transhipment in American bottoms to other ports in connection with shipments of domestic merchandise. "Should the Jones bill become law, our protection principle will be conserved, because, otherwise, the belief that we should engage in foreign trade may, in the course of time, result in a marked modification of our tariff laws, and this may not be necessary if we can maintain our foreign trade and our merchant marine through the medium of these Free Zones. 1922. American Guild of Banjoists, Man- Catholic Benevolent Legion, New The following persons, firms and corporations were elected to membership in The Merchants' Association by the Board of Directors last Thursday: Alban, John A., and Company, Incorporated, Mr. J. A. Alban, Treasurer, 48 New Bowery-Importers of Food Products. Atwater and Clarke, Mr. Roger H. Clarke, 56 Wall Street-Lawyers. Choate, Larocque and Mitchell, Mr. Joseph Larocque, 40-42 Wall StreetLawyers. Cohen, Cole and Weiss, Mr. Arthur J. Cohen, 61 Broadway-Lawyers. Haines Brothers Corporation, Mr. Frederick W. Haines, President, 533 Fulton Street, Brooklyn-Tailors to the Trade. Kossovsky, Mr. Wolf, 267 BoweryGlassware and Enameled ware. Landau, Joseph, Company, Mr. Joseph Landau, 119 West Twenty-third StreetManufacturers of Petticoats and Bloom ers. Maltz and Schutzberger, Mr. Jack J. Maltz, 626 Broadway-Jobbers Millinery. Monowatt Electric Import Company, Incorporated, Mr. Paul F. Altschul, President, 336 Canal Street-Jobbers of Electrical Supplies. Nicols, George, and Company, Mr. William H. Doremus, 212 Fifth Avenue -Mill Agents, Carpets and Rugs. Patterson, Mr. Charles E., Vice-President, General Electric Company, 120 Broadway-Electric Apparatus. Roe, Mr. Murray H., Hafner-Roe National Association of Retail Clothiers, September, 1922. National Association of Men's Ap- Realty Company, 147 East Eighty-sixth parel Clubs, September, 1922. Knights of Pythias, Supreme Lodge, Convention Changes Applies to All Ports "Originally the propaganda for Foreign Trade Zones, free from Customs duty, was limited in its discussion to about three ports on the Atlantic Coast and one or two on the Pacific. The bill as presented, however, contemplates the possibility of the establishment of For- The Convention Bureau of The Mereign Trade Zones in each of the impor- chants' Association announces the foltant ports of entry. This is a great lowing changes in the list of October stride in the right direction, for, if all conventions published in the September of this foreign transshipment were to 26th issue of "Greater New York": be done in the ports of New York, Phil- Volunteers of America, Directors' adelphia and New Orleans, and in only Meeting, listed October 17, postponed to one or two ports on the Pacific, the October 24. congestion of traffic to and from these Automobile Salon, listed October 17, ports would place an additional burden to be held November 27-December 4. Street-Real Estate and Auctioneers. Schwartz and Ehrenreich, Mr. Max J. Schwartz, 115 West Twenty-seventh Street Manufacturers of Evening Dresses. Wilson, O. C. and K. R., Mr. Percy R. Wilson, Treasurer, 78 Dey Street Ship Chandlery. FARM LANDS IN NEW YORK The farm area of New York State was 23,750,000 in 1880. It is now approximately 22,000,000 acres. Asks for Sales Tax but Condemns Smoot Bill This Association Renews Its Demand for a Federal Tax on Sales to Take the Place of Onerous Taxes on Business, but Finds That the Sales Tax Amendment Urged by the Utah Senator Would Lead to Complications-Other Tax Features V The Merchants' Association renews "We recommend that this be op- | manufacture into clothing. That part its advocacy of the Sales Tax in approv- posed." ing a report made to its Board of Directors last Thursday on pending Federal tax legislation by the Committee on Taxation and Public Revenue, of which Mr. Henry Ives Cobb is Chair man. Report of the Committee The report of the Committee, as presented to the Directors, was as follows: "We report as follows on various details of taxation: I Amendments Proposed by Senator Smoot "The Merchants' Association of New of the product which follows the first channel would be subject to taxation when sold by the textile manufacturer; that part which follows the second channel would not be subject to taxation at that point but only after final conversion and sale. "It would be practically impossible for the manufacture of cloth to ascertain the channel through which his product would be distributed; how then could textiles be taxed in accordance with the Smoot amendments? Steel and Iron "I. The simplification and equalization of taxation involving the abolition of a large number of miscellaneous taxes and the consolidation of taxation into a "The case of steel or iron is still few main sources of revenue with sub- more difficult. It is impossible to follow stantial equality of application to all all the ramifications of their distribution classes. or frequent conversions in form, and as "2. Immediate repeal of the excess a result, a large part of the production profits tax. would escape taxation. Taxation of Foreign Traders "The Foreign Trade Committee has requested that The Association approve and support new provisions of the Revenue Bill (Sec. 200, Subdivs. 4 and 5) which define the terms 'Foreign Trader' "3. Repeal of the war taxes on busiand 'Foreign Trade Corporation' and ness and the substitution of a sales tax makes taxable only their gross income at a low rate on all business transactions from sources within the United Statees to replace revenue lost by repeal and (Sec. 213 (c)) as determined under the shrinkage. provisions of Sec. 217. "These provisions and exemptions have been concurred in by both the Senate and the House Committees. "We recommend that they be approved and supported by The Association." II Charitable Contributions by Corporations "The House voted to allow corporations to deduct from their net incomes, charitable gifts in the aggregate not exceeding 5 per cent of such net income. The Senate Committee rejected this provision. "We recommend that The Association advocate its restoration." III Proposal to Tax Bill-Boards and Signs "We recommend that no action be taken." IV Pledge Not Fulfilled "Similar conditions obtain in very many industries; and because of them it would be practically impossible to make any safe forecast of the amount of revenue derivable from so confused and uncertain a source. "It would be most unwise to abandon "The bills now pending in Congress definite and dependable sources of revedo not accomplish any of these pur-nue for other sources whose extent and poses despite the pledge of the Repub- yield are indeterminable. lican party prior to the election to simplify and equalize the taxing system. Complications Would Result "Senator Smoot's proposals concur "Endless complexities of administrawith those of The Association as to the tion would necessarily arise from the repeal of war taxes, and the consolida- conditions outlined, and complication tion of taxation into a few main sources instead of simplification would result. of revenue. He does not, however, pro- "The Smoot amendments will not carry pose a sales tax upon all business trans-out the policy approved by the Directors. actions, but only upon a limited class In place of substituting a universal and of business transactions, namely, a tax simple tax for a number of taxes, Senaof 3 per cent 'upon every commodity manufactured or produced when sold, leased, or licensed for consumption or use without further process of manufacture.' Impossible to Distinguish tor Smoot proposes a tax which is neither universal nor simple, but on the contrary is restricted, complicated, and obscure, and of very uncertain revenueproducing capacity. "For these reasons, while we com"In our opinion the difficulties of dis-mend the repeals proposed by Senator tinguishing between commodities sold Smoot, we cannot approve the form of We believe for consumption and those subject to sales tax which he offers. Proposed Tax on Hotel Rooms further manufacture are so great as to that if a sales tax be adopted, it should "Sec. 907 (a), added by the Senate be practically insuperable. For apply at a low rate to all transfers." Finance Committee prescribes a tax of ample textile products are in part dis10 per cent on hotel charges in excess tributed to ultimate consumers in the of $5 per day per room if for one person, or $8 per day if for more nan one person, ex The Directors approved the report. after full discussion, excepting the reform in which they leave the mills; and ommendation under III that no action in part to other manufacturers for fur- be taken on the proposal to tax billther processes of conversion. such as boards, which was not approved. Praise for Merchants' Association's 1921 Record Other Commercial Organizations, Both in New York City and Outside, Express Their Admiration for Its Work and Methods in Acknowledging Receipt of the Year Book Just Issued-Find Useful Information in "Greater New York" Following are extracts from letters from other commercial organizations acknowledging receipt of The Merchants' Association's Year Book for 1921: Finds Useful Information Andalusia Chamber of Commerce, Andalusia, Alabama: "We greatly enjoy reading your annual reports. Al30 'Greater New York.' Both contain lots of useful and valuable information to a Commercial Secretary." The Enid Chamber of Commerce, Enid, Oklahoma: "Your Book is very valuable to us in that it is constantly in use as a reference book among our merchants." Bangor Chamber of Commerce, Bangor, Maine: "We regard this as one of the most valuable year books in our library, and we frequently turn to it for information." New Rochelle Chamber of Commerce, New Rochelle, New York: "'Greater New York' particularly valuable to us and mail to us. The writer has person- Wisconsin: "Greater New York' conbecause we are 'almost' a part of New ally and frequently received many valu- tains much valuable information-valuYork City, and we believe some day able subjects from both your annual able anywhere, uplifting to any man." we will be a part thereof." report and weekly bulletin." Board of Trade, St. Augustine, FlorGriffin and Spalding County Board ida: "Many New Yorkers visit St. Auof Trade, Griffin, Georgia: "We esteem gustine every winter, and many of our 'Greater New York' the best publication residents visit New York every summer, of its character in the country. We have so find the Year Book useful as a refergained inspiration and new views in ence. The weekly publication is helpful many topics from its pages and some in many ways." times pay you the compliment of disagreeing with you." Compressed Gas Manufacturers' Association, Incorporated, New York City: "The Year Book is up to your usual standard, which could not be higher." Chamber of Commerce, Incorporated, Hamlet, North Carolina: "We fellows in the small places not only get ideas from reading what is being done in the larger cities, but inspiration." The Chicago Association of Commerce, Chicago, Illinois: "The Year Book has just come to hand. I wish to take this opportunity to compliment you on a very high-class publication." Gets New Ideas Hannibal Chamber of Carefully Read Troy Chamber of Commerce, Troy, Gets "Authentic Information" New York: "No publication is more Denison Chamber of Commerce, Deni- carefully read than 'Greater New York;' son, Texas: "We find your weekly pub- the Year Book is used chiefly as a referlication, also your Year Book, both inter- ence volume." esting and instructive. From these pubChamber of Commerce, lications we get authentic information Aberdeen, Washington: "These publi that is useful." Aberdeen a cations are read with much interest and New Bedford Board of Commerce, are given Commerce, our valuable place in Hannibal, Missouri: "I received copy New Bedford, Massachusetts: "We are library." of your Year Book, and have gone over pleased to acknowledge receipt of your Albuquerque Chamber of Commerce, it enough to know I will find some new Year Book for 1921. We look forward Albuquerque, New Mexico: "We have ideas and information which will be each year to receiving this report, which found your publication 'Greater New helpful to us in our little organization always contains much valuable informa- York' of much interest and look forward each week for its appearance. The Year Book is of much interest and help to our members and citizens of Albuquerque, in Hannibal." tion." who consult it almost daily." Grand Rapids Association of Com- Lebanon Chamber of Commerce, Lebmerce, Grand Rapids, Michigan: "We anon, Pennsylvania: "We appreciate inhave received these reports for several deed the opportunity of receiving your years and are always interested in them. publications, since they always contain Furthermore, we are specially interested much valuable information on many in the weekly bulletin which you publish propositions, not only which affect us New York" may be had for sixty-five cents. Special "binders" or covers for "Greater |