Senator GORE. So, percentagewise, though individuals might be hurt in one instance and helped in another, an increase in parts manufactured by subsidiaries, Canadian subsidiaries of the U.S. automobile concerns and a corresponding decrease in the United States, would not adversely affect the membership in the UAW, would it?

Secretary WIRTZ. I hesitate to answer the question except in terms of the facts which you set out which included some implications about the nature of union representation which I cannot subscribe to, so I would simply have to rest on the basis of the question as I understand it to be that 90 percent of the employees involved in the Canadian subsidiaries are union members. I do not believe the implication of your question follows.

Senator GORE. Well, Mr. Secretary, what implications did you understand by the question? I had not stated any and had not intended any.

Secretary WIRTZ. Well, then in my qualification of my answer, I would have removed-let the answer stand as it was. My point, Senator, is that the United Automobile Workers certainly, like the Secretary of Labor, would not be affected in their attitude toward the issue before us by any disregard of the interests of every single worker as an individual. I just would not deal casually with the dislocation of any particular worker even though I might feel that somebody else had a job as a consequence of it, and that was the point of concern that I felt in hesitating about the answer to your question. Senator GORE. Well, thank you. I am sure all members of organized labor would subscribe to your statement, and I do not think that union leadership was casual or cold. But a substitution for a U.S. parts manufacturer of Canadian subsidiaries of American concerns whose employees are, for the sake of discussion, 90 percent organized, and a corresponding decrease in production in the United States by employees who are 75 to 80 percent union affiliates split among four unions, would not in any way diminish the total UAW membership.

I ask that or state that as a simple matter of arithmetic without implying that the UAW position had been taken on the basis of that. Secretary WIRTZ. The point is, as long as there is an arithmetical point, I have no difficulty with it.

Senator GORE. Now, going to the question of wages, are there significant differences in the wage rate paid in the various provinces in Canada?

Secretary WIRTZ. As between the provinces?

Senator GORE. Yes.

Secretary WIRTZ. I do not have any information that would suggest that difference, but we would be glad to check the record to see whether our information, which is on a Canadian basis, would show any marked differences between the provinces.

Senator GORE. Well, in this instance I would ask you to submit it for the record.

(The information referred to follows:)

TABLE 1.-United States and Canada: Average hourly earnings of production workers in all manufacturing and in motor vehicle and equipment industries, selected months, 1963-65

NOTE. The par value for the Canadian dollar, established in May 1962, is 1.08108 Canadian dollars per U.S. dollar.

Sources: "Employment and Earnings for the United States, 1909-64," Bureau of Labor Statistics, U.S. Department of Labor, December 1964; "Employment and Earnings," August 1965, Bureau of Labor Statistics, U.S. Department of Labor; The Labour Gazette, selected issues, 1964, official journal of the Department of Labor, Canada; "Man-Hours and Hourly Earnings," May 1965, Dominion Bureau of Statistics, Department of Labour, Canada.

Motor vehicle parts and accessories:

Secretary WIRTZ. And the question, to be sure I understand it, is whether there are marked variations, and we are talking about wages among the various Provinces.

Senator GORE. Yes. I was particularly concerned, Mr. Secretary, with the variation in wages in the outer Provinces-well, not particularly outer Provinces, but in areas removed from the DetroitAkron-Great Lakes areas the cities, towns, and communities near the automotive production centers in the United States. I would think there would tend to be less difference in wage rate than there would be, for instance, between a wage rate in Detroit and Toronto or in Ottawa or Montreal.

I may be in error about that, and if you will find that information

Secretary WIRTZ. It sounds reasonable. I would expect there would be some of that, and we will supplement the record to whatever extent it is illuminating to the extent of our information.

Senator GORE. Well, thank you, Mr. Secretary. I am sorry that it has taken so long and that there have been so many interruptions. I believe we have finally, particularly this afternoon, gotten to the kernel of the issue here. I can agree with you that a trade war would be a most undesirable, unwelcome event between the United States and Canada. The undesirability, however, of the event does not always prevent it from occurring, and with a remission of duty scheme Canada started it.

I do not like to see the United States take a powder and then give in even further and yet claim that there is some victory involved. It seems to me a rather ignominious performance. The law required countervailing duties, and the law was not obeyed, and this is advanced in my opinion as a substitute for action which was and still is legally required. I do not wish to foreclose any comment on your part, but this concludes my questioning.

Secretary WIRTZ. My comment would be very limited. First I do have for the record now the figure which either you or Senator Hartke requested as to the increase in U.S. employment, increase in employment in the U.S. automobile industry between June 1964 and June 1965. That figure is 112,000. From January of this year to June employment increased by 43,000 workers. I would suggest that that figure, probably like the Canadian figure which was referred to, has a high seasonal factor in it, so that there would be some question as to how far it could be relied on, but that was the information that was requested, and the increase this year from January to June was 43,000.

No closing comment. I have complete respect not only for the position that has been taken but for the identification of the difference and would not mean to open up any additional discussion but only to make clear that the basis of the testimony of the administration here has been so largely in terms which you fairly referred to as comparison of the situation with what it would be absent an agreement and the kind of legislation to which we here refer, and I mean only to summarize what has already been stated as the position that we do feel quite candidly, quite sincerely, and quite strongly, Mr. Chairman and members of the committee, that the development of an international trade policy in the pattern of the agreement and in

the pattern of the legislation before the Senate is imperative to the future welfare of the industry, both in Canada and in the United States, and if I summarize in terms of understatement, it will be only on the basis of everything which we have said having been already stated in the record.

Thank you very much.

Senator GORE. Thank you very much.

Excuse me just a minute. We have an honest disagreement. I hold this an improvident and unwise agreement, and I shall oppose it on the floor of the Senate.

Senator LONG. Mr. Secretary, let me just briefly spell out for the record the case for this as I see it and see if it fits, in view of the fact there have been a number of statements made and to some extent speeches made against this measure during the course of these hearings.

As I understand it, we have-how big is our trade surplus with Canada, Tom-I was just trying to see what our trade surplus with Canada is.

Secretary WIRTZ. About $550,000 to $575,000.

Senator LONG. Here is a statement our committee has, that we have, as I understand it, a favorable balance in goods and services with Canada in 1964 of $1,183 million. Now, that is a favorable balance that we have. Of that, almost half of it is in automobiles and automobile parts of which we export about $593 million and they export us in 1964 $64 million, so that accounts for about 50 percent of our favorable trade balance with Canada.

As I understand it, that is being made up by American loans to Canada and by American investments in Canada. Now, minus those I should think Canada would have a very serious problem.

Now, further it is my understanding that Canada, just as other countries are doing, has a right, if she wants to, to impose tariffs or impose these stipulations that these automobiles be made principally in Canada to the extent she could shut off that $523 million favorable balance that we have with that country. Is that not what other countries are doing? Is not Brazil doing that as her automobile industry grows?

Secretary WIRTZ. That is correct.

Senator LONG. In other words, she is stating that they be entirely made or 90 percent Brazilian made.

Secretary WIRTZ. That is correct.

Senator LONG. If we undertake countermeasures against Canada as she moves in to protect her domestic automobile industry and this develops into a trade war between the two countries, in view of the fact that we have a favorable balance of about $1,180 million of a gross trade-let us say of a trade that works out to about $4 billion, somewhere about, $4.5 billion on U.S. exports-would it not in fact be that if we engage in this kind of a cutthroat activity where we retaliate and then Canada retaliates and we retaliate again, that if all trade was shut down between the two countries while both countries would lose, we would be by far the larger loser?

Secretary WIRTZ. Ten to one.

Senator LONG. Yes. In this particular item we figure to lose 10 to 1. It is not fair to recognize that Canada is in position-I be