The great influence of dolls on the lives of young children has always been recognized. Their dolls should breathe the spirit of American character, expression, and dress. These dolls can be produced better by our own American manufacturers.

Dolls are the oldest of all playthings, and have always been characteristic of the country of origin. They have been found in the tombs of ancient Egypt, the catacombs of Rome, and in the Indian mounds and cliff dwellings of the carliest inhabitants of America. They mold the infant minds of future mothers, and should be national rather than alien in design.

We believe, aside from all commercial considerations, that the doll mothered by the American child should be American in every respect-in features, form, costume, and spirit.

The early ideals of the little woman citizen should be directed and influenced by the handiwork of American artisans.

BRIEF OF J. L. AMBERG, PRESIDENT OF THE AMERICAN DOLL AND STUFFED TOYS ASSOCIATION, NEW YORK CITY.

Having just returned to the United States from a three months' business trip to Europe, I wish to lay before the Ways and Means Committee certain information that I have acquired as to conditions abroad which may be of value to the members of the committee in the making of rates in the new tariff bill. I have been a frequent visitor to Europe on business trips, so that I am in a position to judge conditions as compared to those formerly existing, and have gained an acquaintance which permits me to ascertain what is the real truth of the situation.

In all industries Germany is without question the busiest country in Europe. There is less unemployment there than on the Continent or in the British Isles, where it has reached more or less appalling figures, as you can easily judge from statements daily in the press. As a matter of fact, it is frequently stated that there is actually a lack of labor in many industries in Germany. That there is likewise an insufficiency of housing there is no doubt, and this is evidenced by the fact that any German with spare room is compelled by regulation to take in boarders whether the station of the owner be high or low.

In toys particularly, where the industry during the war was much curtailed because of lack of export, the Germans have come back exceedingly strong. With one or two exceptions they seem to have ample raw materials, and although coal seems at times, according to their statements, to be lacking, there seems a great doubt regarding this for the reason that offices and hotels are so warm that at times it seems unbearable. In fact, various big plants and organizations have fixed their quotas for export for 1921, and these large factories we have been shown will easily be able to take care of a very great volume. It is true that they are substituting in a number of cases, such as using sheet metal instead of tin, but on the whole even though not up to prewar standards their merchandise is creditable. On cheaper lines, with a tremendous variation in exchange, which is about 1,400 per cent lower than prewar exchange, there is absolutely no chance for any nation on earth, irrespective of tariff or duty or regulation, outside of clear embargo, to possibly sell normal staple lines in competition.

With the exception at the moment of one quality of mohair plush, they are absolutely self-sufficient in manufacturing or turning out raw material. The German method of dumping or stifling competition was in evidence in Great Britain by the operations of a concern known as Bing Bros., of Nuremburg, a combination of about 20 toy and doll factories-known in Great Britain as the "German octupus.' These people, when they found that alone in plush animals they could not compete decided that the way to break the market was to take over the managing director of one of the best known concerns Farnell's and put him into business for them in London. The very first plush toy they offered was a small size set of dog, cat, and rabbitvery staple items in sale at prices about 33 per cent below the cost of production. This very staple line generally sold from 12 shillings to 13 shillings 6 pence per dozen. This they immediately cut to 75 shillings per gross, or 6 shillings 3 pence per dozen. The writer was assured by one of the most stable manufacturers that this very competitive line cost, without the faintest question, any manufacturer in Great Britain roughly not less than 10 shillings a dozen to make. The plush cost alone was higher than the selling price of this German animal.

In other words, the Germans, knowing that German toys could pretty well drive out most makers in cheap or ordinary toys, decided that the only game to play was to take a line that every store everywhere would have to sell at about 14 shillings, and have the same sold for about half, or 9 pence.

My examples will show clearly how German competition right up to the moment was affecting Britishers, for the reason that I could see it as I traveled through Great Britain. The identical result I know others can show is accruing in the United States. Take, for example now, the toy train business. Germany has always made a great many of these and in models that were exact replicas of British or American railways. During the war two British concerns turned out very creditable lines. It is an open secret that of these two the Whitely Tanzley Co. (Liverpool) decided last month they could not possibly withstand German quotations, and decided it was cheaper to quit toy trains and tin mechanical toys. The other concern, British Metal & Toy Manufacturers (London), is at the moment seriously considering doing the same thing. I happen to know these people well, and for two weeks, with hundreds of buyers about, they sold nothing.

Take the case of rubber balls. Austrian and German goods have absolutely displaced such British articles because, as was shown us by Pickles & Co. (Glasgow), the British balls at to-day's exchange, even delivered at Glasgow, cost just double. There are other lines of toys being sent very freely from Germany to every place in the world, such as composition toys, celluloid goods, and the like. But one of the most interesting of these cases is dolls. We can say as a fact that American dolls to the extent of thirteen to fifteen million dollars (wholesale selling price) were produced in the United States last year. Roughly $10,000,000 worth were produced by about 50 makers, and the hundred other small manufacturers made from three to five million more. Among these, exactly as in Great Britain, are complete lines of fully jointed hard body dolls, as well as kid dolls. I venture to say that the bronze dies and molds, with presses producing these, last fall in the United States cost various manufacturers many hundreds of thousands of dollars. And at the present moment these represent only a very nice mass of metal which might be offered for sale at a very low price unless industrial conditions are changed. The fact is that I saw dolls delivered in Newcastle-on-Tyne of the fully jointed type 24 inches with bisque head at a cost to the British wholesalers of 8 shillings each, or roughly at today's exchange under $1.60. I have just discovered that various American makers quote as lowest jobbing prices the following:

None.

Bisque head (like German), $6.50.
None.

(a) Composition head, $5 each. Bisque head (like German), $6.25. (f) Composition head, $3.75 each. (h) Composition head, $5 each. (b) Composition head, $3.34 each. (c) Composition head, $5.75 each. Bisque head (like German), $5.75. And these prices are f. o. b. factory in United States of America and not delivered, as in England. The American prices for 24-inch dolls cover various qualities, some not nearly so good as the German.

And the British doll manufacturers in a very few months, unless the proposed legislation goes through in Parliament, can be searched for unsuccessfully with a microscope. A few notable ones are still making heroic efforts to manufacture and compete, but there is not the slightest doubt but that this is definitely impossible. Germany is just 14 hours from British port across the North Sea, and manufacturers galore come right over by the hundreds and quote their wares. It was amusing if not heartbreaking to the writer, as well as to a number of natives of Glasgow, to note what happened at the end of January in the Glasgow City Hall. A German manufacturer of dolls by the name of Hachmeister was showing his wares, and by his room all day was streaming the city unemployed coming to collect their pittance. A sad commentary upon conditions. Some of these good people seeking sufficient to buy bread might not have been out of work were it not for German ruinous competition at the moment.

In kid and imitation kid dolls, like in the fully jointed dolls, Germany again has become predominant. Against them there is no opportunity for similar English and American kids to compete. This is due to their low manufacturing cost as well as the depreciation of the mark.

In Great Britain, as was pointed out by Mr. H. O. Roberts, of Roberts Bros., game manufacturers, at Gloucester, England, the importation of German toys for the first six months of 1920 was 120 per cent over the same period of 1914. The figures were dissected for a period of months and it was shown that 1.173,400 dolls had been imported into Great Britain for that period. If that continued at the same rate for the remainder of the year, there were sufficient German dolls imported for every eligible British child to have one. All other games and toys were so largely imported that, just as with American factories, orders were canceled, goods were left on the shelves, and considerable reduction accrued in the staff of business concerns.

As to expenses and cost of production in Germany, I submit the following: As is well known, a mark in the United States or Great Britain to-day is worth about

$0.0175 (13 cents). In other words, it used to be worth 14 times as much. If German costs had advanced 14 times we would be in the same condition as we were in 1914. But have they? All information received from innumerable sources, and compared time after time, would go to prove that the mark, instead of depreciating in Germany to any such extent, is worth about one-fourth or one-third of what it was in prewar days. By that I mean that a mark-which was worth roughly 24 cents-now has purchasing power of about 6 or 8 cents in Germany, whereas when we give them marks in return for merchandise we need only to pay a sum under 2 cents. Here is a very excellent example given to me by Mr. Creighton, of Todd, Cunningham & Petry-very large wholesalers in Scotland. Mr. Creighton left Germany on the 10th of January and spent five days at the Grand Hotel, Nuremburg (one of the very best), and that sojourn, including what is known as "early breakfast," cost him 180 marks, One hundred and eighty marks, as can readily be seen, figured either in shillings or more readily in dollars, is roughly $3.50 for five days' hotel accommodation. Similar accommodation in Great Britian or the United States could not possibly be bought for five times that amount.

The average laborer or clerk receives roughly 1,000 marks a month. But this is very little indeed, because in dollars with which we buy merchandise from Germany actually this laborer only makes about $4 a week. Besides, he is certainly not overpaid from his own point of view since a pair of shoes cost 500 to 600 marks and a suit of clothes from 1,500 to 2,000 marks.

There is not the faintest doubt in the mind of anyone who has traveled large towns as well as villages in Europe that the standard of living everywhere in Europe is very far inferior to our own. You will note that the average German worker to-day makes $4 a week. You may likewise be interested in learning that the British manufacturers are at the moment up in arms at the new board of trade regulations going into effect this very month, February, 1921. These stipulate that no boy or girl of 16 years old may be employed for less than £1 a week ($3.92 to-day). The writer was told by a number of established manufacturers that such a wage would work considerable hardship upon them since they have been paying new help 10 or 15 shillings a week. Compare the wages which a boy or girl starts at to-day in our line. They are not offered in the poorest and cheapest establishments less than $10 or $12 a week. As a matter of fact, last year in the doll business green boys and girls were taken on regularly by a dozen manufacturers at $14 a week, but in Great Britain-to give them every benefit-they were not paying more than 15 shillings or $3 a week at the same time.

It may properly be said that the cost of living is less, and in some ways it certainly is, although rents and food are just about as high there at the present time as they are here. Certainly the disproportion is enormous after considering everything, and is accounted for partially by their lack of ambition, to which must be added their standard of living so far below ours.

Because of untoward conditions in Germany, the purchases of toys and luxuries are very meager and our German friends are playing the old game of letting the rest of the world buy their merchandise. In this particular, I respectfully call your attention to a very remarkable fact. We are being rankly discriminated against by Germany in that they have an absolute embargo upon all toys and fancy goods against not only America but the rest of the world. They are very anxious to have us buy their goods, although they will not buy ours. Are we going to sit by and permit this to happen? Of course, as far as our exporting to Germany is concerned, we have a chance best represented by a large cipher.

Germany has placed an export duty upon her products, and part of this duty is immediately remitted to "deserving" industries for advertising or subsidizing where competition is diflicuit. It is stated that this subsidy for the toy industry will run into billions of marks. Manufacturers have been ordered not to make or ship certain commodities, so that others might be exported. For example, although there is a definite need for those who buy German dolls for parts or heads for repair, I discovered that at the present time, irrespective of price, these would not be sold. The theory, more particularly as espoused by Bing Bros. at Birmingham, England, was that they could compel people at present to buy complete dolls instead.

I can speak with absolute authority upon another phase of the British protection situation. Please note this carefully. În confidence I am glad to point out that the new bill, which is being reported February 15 to Parliament for action by Mr. Arthur (the head of the British Board of Trade), as it affects toys, has been passed on by the leader of the British toy industry, Mr. W. B. Tattersall, editor of the Toy and Fancy Goods Trader and vice president of the British Toy Association. Just two weeks ago a sketch of the final draft of the bill was shown to me, and it is as follows:

"In order to protect the British industry and make up for the disparity of exchange, Great Britain is unwilling to figure the mark roughly at 1 penny (less than 2 cents), but insists upon figuring it, in case it should be lower, at 24 pence (roughly 5 cents). In other words, when German exchange remains under 5 cents for a mark, the difference between 5 cents and the actual exchange (to-day 2 cents) must be paid to the British Government in the shape of an import duty.'

It is recognized, therefore, that actually under conditions as existing at the present time there will be within a month, I am assured, duty calculated at 150 per cent (the difference between a 2-cent mark and a 5-cent mark). Of course if the mark becomes more valuable, and as it approaches 5 cents in value, the duty becomes less but in effect the status of the cost to toy dealers is absolutely the same. This bill is called "Bill for purpose of stabilizing exchange for protection of British key industries," among which toys have been included. (The actual bill to be reported, which is assured of passing, calls for, in English money, a parity of marks amounting to 100 to the pound instead of about 240 to the pound, which is the present rate of exchange in Great Britain.]

The toy and doll industry is asking for a duty of 60 per cent. Of course this is done in the hope of better times and greater parity of exchange. At the present moment, under present exchange rates, the duty that is asked would be absolutely ineffective. We are making a conservative request, so that when times are less out of joint we may have a proper fighting chance for our industry to live. It is disheartening to have buyers for American stores go abroad and come back, as some have already, and tell us that they have "entirely finished with toy purchases. It is disheartening to note that 58 left recently for Germany on the steamer Lapland. We can only hope that we may get a proper opportunity, not to push one or two rag specialties, as we had to do in 1914, against German competition, but that we may have a real chance to compete on even terms in the American market with our foreign competitors; that there may be opportunity given to the toy industry to exist and to develop and to have the child life of America stimulated and educated by American-made dolls.

STATEMENT OF MR. J. L. AMBERG, REPRESENTING LEO SCHLESINGER & CO., 64-68 WOOSTER STREET, NEW YORK

CITY.

The CHAIRMAN. Mr. Amberg, state your full name.
Mr. AMBERG. My name if Joshua L. Amberg.

The CHAIRMAN. What company are you associated with, or firm? Mr. AMBERG. I am representing here to-day, as a manufacturer, Leo Schlesinger & Co.

The CHAIRMAN. Where is that company located?

Mr. AMBERG. At 64 to 68 Wooster Street, New York City.

The CHAIRMAN. Are you here as an attorney or a manufacturer? Mr. AMBERG. If you please, I am here definitely as a manufacturer. I am personally a manufacturer of toys.

The CHAIRMAN. You are associated with the firm of Schlesinger & Co. ?

Mr. AMBERG. I am.

The CHAIRMAN. Proceed briefly in your own way to state to the committee what relief you want.

Mr. AMBERG. I was not going to talk on toys and dolls, in which I have had an experience of my own lifetime. I am just back from abroad, and I have tried in my small way to study conditions to the best of my ability as they obtain both here and in foreign countries, as affected by German competition primarily.

What we want, Mr. Chairman, is the disparity of exchange feature in that bill retained. That is your question; that is my answer. Senator SMOOT. The 663 per cent proviso here goes beyond that. The balance of section 25 preserves that parity, if that is what you

want.

44121-21-PT 2- 4

Mr. AMBERG. The parity of 24 cents on the original value of the mark, is it not?

Senator SMOOт. But, when we put in the 663 this parity is not maintained, but five times the parity.

Mr. AMBERG. You mean instead of one and a half, it will be 8 cents?

Senator SMOOT. Instead of one and a half it will be 8 cents.

Mr. AMBERG. If you please, that is what we think we would require.

Senator SMOOT. Why do you require it?

Mr. AMBERG. If you will give me a few minutes, I will try to tell

you.

Senator SMOOT. You are asking for a parity, and then when we give you a parity you want five times the amount.

Mr. AMBERG. No; I want the possibility of getting away from the disparity between exchange value and the purchasing power of the mark in Germany and here. That is what I mean by "parity," a parity in purchasing power and not parity of one and a half cents, or one and two thirds of the actual mark.

In the first place, on this parity proposition, the parity that we require an opportunity to compete with Germany, which we can do when the mark costs one and a half, and when we pay one and a half, approximately, for it. I would like to show, if I can-and this is exactly on the subject-how this works out in the matter of toy and metal goods. The present duty on toys is 35 per cent. A mark at 14 cents, or, let us say, for simplicity, 100 marks for a dozen, will bring it to $1.50. I happen to agree entirely with the importers when they say it costs $3, or 3 cents a mark, to land that in the United States. I quote one of the very largest importers by name, Bing Bros., of Nuremberg and New York, who are German importers. Mr. Bing says that if we bring into effect this section, this disparity of exchange we want the exchange section of this bill-that the change of 3 cents a mark landed cost, one and a half over there, 3 cents delivered here will bring it up to about 5 cents landed. That is very readily arrived at. One and a half a mark, with 35 per cent duty, brings the duty, together with the landing charges, as I say, up to another 14 cents. If you make it five times that, Senator, in accordance with the provisions of the bill, or 8 cents per mark, it will bring, instead of 35 per cent, 175 per cent duty on toys. In other words, there will be an extra duty at the present valuation that we require of 140 per cent, or 1 or 2 cents. That is, 3 cents landed ordinarily, and 2.1 brings it up to a little over 5 cents. For the sake of argument, I want to agree with the importer who says it costs from 5 to 10 cents.

I can show you a toy purchased in the city of Washington in a department store this morning to prove this point. Take a mark at 6 cents, which is about what it is worth under the bill proposed and passed by the House. This trumpet [exhibiting metal toy to the committee] cost this morning in a department store in this city 10 cents. This trumpet would ordinarily cost this department store from $6 to $9 a gross. They sell at $14.40. A trumpet like this from Leo Schlesinger is to-day purchased for $19.50 a gross against possibly $9.