TARIFF ACT OF 1929 SPECIAL AND ADMINISTRATIVE PROVISIONS MONDAY, JULY 15, 1929 UNITED STATES SENATE, The committee met pursuant to call at 9.30 a. m. in Room 312, Senate Office Building, Senator Reed Smoot (chairman) presiding. The CHAIRMAN. The hour of 9 o'clock and 30 minutes having arrived the committee will come to order. To-day has been set apart for the consideration of special and administration provisions found on page 388 of the House bill, under title 4. GENERAL STATEMENTS STATEMENT OF CHESTER H. GRAY, WASHINGTON, D. C., REPRESENTING THE AMERICAN FARM BUREAU FEDERATION (The witness was duly sworn by the chairman.) Mr. GRAY. In appearing before you on the administrative and miscellaneous provisions I want to call attention to four topics; and I shall make an effort to be as brief as possible; if I could be uninterrupted I could finish all that I have to say in 15 minutes easily. The CHAIRMAN. I hope that you will not be interrupted. Mr. GRAY. The flexible provision, the Tariff Commission, the general proposition of our colonies, and milling in bond are the four administrative provisions which our membership in the Farm Bureau are interested in. Taking up the flexible provision first, and referring to section 336 of the House bill where it is found, I wish to call attention briefly to our desire in the Farm Bureau that a flexible provision be retained in the forthcoming tariff law. Our membership in the Farm Bureau during the last two years has been more attracted to and interested in the flexible provisions than any other section that even might have included rates. The reason for that is this, Mr. Chairman and members of the committee: During the last two years the farmers have realized that some of their rates were not adequate, and to get the rates raised under the flexible provision, such as the 50 per cent limitation feature, we have been interested before the Tariff Com cherries, maple sirup, maple sugar, butter, milk, cream, fresh tomatoes, canned tomatoes, tomato paste, onions, eggs, and egg products. That shows the wide interest of our people in provisions the rates on their commodities; and that same indication is now and was reflected over on the House side weeks ago in rates on agricultural products by revision. There are two n our membership is well cognizant, of rebuilding rates-the method and the revision method; the first being by the Com the second being by Congress. We must state that the flexible provision as in the act a certain extent, as in the bill, does not allow that ease of chan rates which we desire. In other words, instead of elimina flexible provision we want to make it really true to namein fact; and to make it flexible would like to have incorporate language of the bill that this committee reports, among other these ideas or devices Senator SHORTRIDGE. Addressing yourself to section 336 Mr. GRAY. Yes, sir; section 336 which was section 315 in In section 315 of the act, and not so much so in section 33 bill, too much dependence in gaining flexibility is put upon production. In other words, to get a flexible change in the ra down we have had to prove that the cost of production here cost of production abroad differed enough to justify a 50 or any other percentage of increase or decrease within the cent limitation. The fact of it is that it is difficult sometimes, even in our ov try, to get the cost of production, although that is not supe difficult; and when we go to foreign countries and try to costs of production we are in an almost impossible condition. We want a flexible provision to be so drawn that competit ditions here and abroad shall be more of a determining factor the rate shall be up or down than merely cost of product other words, we want to relegate cost of production very down towards the end of the factors determining rates up or d let competitive conditions be the yardstick as to whether should be increased or should be decreased. Senator REED. Will you describe what you mean by con conditions? Mr. GRAY. Yes. Just merely to state in the law, Senato that competitive conditions should be the determinator yardstick would put the Tariff Commission and everybody interminable difficulty in interpreting that. Competitive co should be defined by some such language as is in our brie will summarize it as follows: When the foreign value plus the duty and transportation lower than the domestic value of a like or similar domesti plus transportation costs, there is one measure to ascertain you have competitive conditions. Another is this. When the price to producers in the 1 competing country plus the duty and transportation cost than the cost to the domestic producers of a like or simila plus transportation cost. much work under the flexible provision as it has had down to and the President can not give his personal attention to those The Tariff Commission, if it should be made a determining subject to review by Congress, of course, as well as a factbody, would have the same powers that these other Federal have in regard to other rates. Does that answer your question? Senator SIMMONS. You would give them the sole contro rate-making as is given the Interstate Commerce Commission Mr. GRAY. A similar power and authority, yes, Senator Sin Senator SIMMONS. Under that control of rates by the Int Commerce Commission we have the highest freight rates to-da we have ever had in our history. Senator SIMMONS. And notwithstanding our experience i particular, you would have us turn over to this commission the to fix rates, giving them the same broad power and finality given to the Interstate Commerce Commission? Mr. GRAY. Yes; but if the Tariff Commission, as is the case i statement relative to the Interstate Commerce Commission, become too much one-sided in its determinations and that one ness is not corrected, the fault then lies with the determining which is the Congress of the United States. Senator SIMMONS. Let me call your attention to another pl the proposition. You would authorize them to investigate a termine which one of the several methods of testing comp should be selected, but you would require them always to mal comparison, for the purpose of determining whether compet there or not, with the selling price in the United States? Mr. GRAY. I believe that is true according to the summary here a while ago. Senator SIMMONS. Regardless of whether that selling price is price or an extravagant and confiscatory or trust-controlled ra Mr. GRAY. May I offer this explanation before you finish question, please? The matter of competition in making the Am selling price might be our safeguard. Senator SIMMONS. Do you not make the American selling without regard to whether it is a fair or just price to the Am people, the absolute standard upon which you are to test this qu of competition? Mr. GRAY. The brief which we filed, Senator Simmons, in of appearance before this committee on valuation, brought up thi question which you have in your inquiry of this moment. I brief we, for the Farm Bureau, took a position in favor of the do basis of valuation which is, as defined then, to ascertain va the domestic wholesale selling price. Senator SIMMONS. But what I want to ask you is, do you w give the commission at the same time you give them the po fix the price of the foreign product, the power to determine w the domestic price is a fair price? Mr. GRAY. Yes. |