Mr. KING. Would you answer one question, please?

I meant to put it to Mr. Stein and the other gentlemen. I feel I should put it to one of you before you left. Does it not quite simply come down to this: H. R. 1 and the existing law is not so much the enemy you are attacking. The executive departments have not acted and performed promptly, as the law allows them to, to relieve the situation that we fully realize exists in this industry and in others? Mr. TORBERT. I think that is it. As Congressmen have told me, Congressmen of this present session, the intent was that the escape clause would be enforced. They said it is not the trouble with the escape clause so much as it is with the administration.

I do believe, though, that the recommendationse made here today, appeared as I have said here in my statement, that it should be withdrawn from the President and perhaps placed in the hands of a reconstituted Tariff Commission.

The CHAIRMAN. We thank you, Mr. Torbert.

The next witness is Mr. E. L. Wheatley, first vice president, International Brotherhood of Operative Potters.

For the record, give your name, address, and the capacity in which

you appear.

STATEMENT OF E. L. WHEATLEY, FIRST VICE PRESIDENT, INTERNATIONAL BROTHERHOOD OF OPERATIVE POTTERS

Mr. WHEATLEY. E. L. Wheatley, first vice president, International Brotherhood of Operative Potters, 215 Broad Street Bank Building, Trenton, N, J.

The CHAIRMAN. I understand, Mr. Wheatley, you are to present the statement of Mr. Frank Hull, the president of your union?

Mr. WHEATLEY. That is correct, Mr. Chairman.

The CHAIRMAN. You are recognized and may proceed with your statement without interruption.

Mr. WHEATLEY. Mr. Chairman, since I am substituting for Mr. Hull who is absent on doctor's orders, I would like to confirm what has been compiled in this statement of facts, that the organization I represent is an old line craft potters union with approximately 33,000 members at the present time, who, in each convention as far back as I can remember, and I am going back about 25 of the years, have always authorized their international executive officers to oppose any bill at any time that will bring in another dozen of ware that will potentially destroy a job opportunity for the potters or, for that matter any other American working craftsman.

I might add that in these 33,000 members, to the best of my knowledge there is not a Commie that I know of or heard of as being affiliated with a communistic outfit. I have never heard of even a parlor pink. This is not in any statistic I do not believe, that you can get your eyes on today or me either. One of the old-line potteries folded up in Trenton and was sold December 10. That is the Scammell China Co. that had been making, in my estimation, one of the finest lines of chinaware in the world. There are now approximately 200 more potters, with the average age of about 50, on the scrap heap and on the unemployment rolls in Trenton, along with approximately 12 to 15 hundred other potters in Mercer County, due to the unemploy

ment and the shutting off of production of artware, novelties, and other similar potteries.

I just want to state that out of those 33,000, we know of no Commies, but we are wondering how many Commies are involved in some of these imports that are coming in, or that may even come in under any lowering of the bars.

This is a brief presented before the Ways and Means Committee, in behalf of the International Brotherhood of Operative Potters, American Federation of Labor, East Liverpool, Ohio, by Frank Hull, president, International Brotherhood of Operative Potters, AFL, East Liverpool, Ohio, January 1955:

The International Brotherhood of Operative Potters, an affiliate of the American Federation of Labor, represents the great majority of the workers in the American dinnerware and chinaware industry. The principal purpose of this brief is to place ourselves on record in opposition to any negotiations with Japan or other countries looking toward reduction of the existing tariff rates on the items covered by paragraphs 210-211 and 212 of the Tariff Act of 1930.

The views of the International Brotherhood of Operative Potters are reflected in the following statement that was made by the executive council of the American Federation of Labor in its report to the 1953 A. F. of L. convention:

We cannot look on with indifference when our wage and labor standards are undermined by competition from abroad that derives its advantages from low wages and inferior working conditions * * *

Where tariff rates have been reduced to a point below which unfair competition sets in, a workable remedy should be available to the workers and industries injured thereby.

The statement adds that:

At the same time we recognize the need of a maximum of foreign trade that can be carried on without destroying the standards that have been so laboriously built up through our efforts of many years.

The unfair price competition that results from comparative lowwage scales paid in the pottery industries in the principal countries that export pottery to the United States, speaks for itself and needs no explanation in face of the following data compiled by the Division of Foreign Labor Conditions of the United States Department of Labor.

(The table referred to follows:)

Average hourly wages in the pottery or ceramic industries, United States and foreign countries

In the pottery industry in the United States wages represent about 65 percent of the total cost of production. Mechanization in the American dinnerware and chinaware industry, by the very nature of the product manufactured has its severe limitations peculiar to the pottery industry. However, most of the operating employees in our industry are pieceworkers and receive wages only for that which they produce, and a very large part of their weekly take-home pay, representing increases since 1900, have been the result of increased production.

I am receiving demands daily from the general membership of the International Brotherhood of Operative Potters demanding wage increases consistent with the wage increase potters established on a national basis in 1953 and 1954 which we have been unable to bring to our people to this date.

We are wondering if the proponents of H. R. 1 are prepared to present to the American pottery worker, whom I have the honor to represent, a program that will make up his pay deficiencies by 30 percent and alleviate the distress our people are suffering at this time from foreign competition.

I repeat again, the American pottery worker is a pieceworker and not a drone. The worker has extended himself by increasing his daily production to the limit. Under present production standards, in the event of further lowering of the tariff, it will undoubtedly result in increased unfair competition and survival of the industry will certainly be placed in jeopardy, and the pottery workers will be thrown on the scrap heap to the advantage of the importer and not to the advantage of the American purchasing public because the wage differential between the American pottery worker and the foreign pottery worker are not reflected in retail sale prices.

The American pottery worker is a highly skilled craftsman. He serves a long apprenticeship of 2 and 3 years at less rate of pay than journeyman rates. He makes a real sacrifice in attaining his journeyman trade status. His average age is 50 years. Were he given an opportunity in other industries, which is not the case, readjustments would be questionable. Therefore, his only future prospect under the provisions of H. R. 1 is to swell the ranks of the unemployed.

If the proponents of the vicious H. R. 1 would dare to be so brazen as to attempt in the face of past history to prove without question the advantage of this proposed measure to any industry confronted with unfair competition and low-wage nations the bill would not be quite so bitter. However, as it affects the American pottery operative, disaster is bound to be the end result, and if and when our Government whittles away all protection, which has been continued since the early thirty's, the ultimate will be the elimination of the American dinnerware industry and the American pottery market will be a battleground for the foreign pottery manufacturers which will in no way tend to improve the economy of the foreign pottery worker. The fact of the matter is his standard of living will be further depressed unless our Government establishes price selling standards in the American pottery market for the foreign pottery manufacturer, the possibility of which is nil.

There is no doubt that the American producer could compete successfully if he could pay his employees the same level of wage that prevails in Japan and in Europe.

To reduce the duty in the face of these facts would have the effect of the Government throwing its weight against collective bargaining and minimum wage laws, for tariff reductions would undermine both.

An example of this unfair price competition is contained in the findings of the United States Tariff Commission in its report to the President last June on the household china tableware investigation. A pertinent extract from the report is as follows:

The rate of duty necessary to equalize the United States and Japanese costs of production of medium-grade chinaware is 284 percent ad valorem based on foreign value and 15 cents per dozen separate pieces.

Imports of pottery have increased very sharply since the end of World War II. The Japanese pottery industry has been rebuilt and rehabilitated and offers very serious and injurious competition, based on the wide wage differential already referred to.

The following table shows the rising tide of these imports since 1946 supplied principally by Japan, Germany, Italy, and the United Kingdom:

Thus, imports since 1946 have increased $22 million, the greater part since 1949 coming from Japan.

With this trend of increased imports domestic pottery producers are virtually at the mercy of low-priced imports, particularly in the present-day buyer's market as distinguished from the previous seller's market. Obviously under these circumstances a remedy is needed if the industry is to survive and to maintain a minimum level of employment.

As pointed out by the Tariff Commission, the present tariff is grossly inadequate for the protection of a reasonable level of employment at fair wages. However, an increase in the tariff rates would not have the desired effect. In order to bring about something approaching competitive parity, the rates would have to be raised to a point of apparent exorbitance.

Under these circumstances, we believe that an import quota would afford a better remedy. A quota adjusted to the market condition would insure a maximum of imports with a minimum of injury. Foreign exporters would then participate in any expansion of the domestic market but would also partake of any substantial shrinkage of the market.

Such quotas would help to dissipate the fear that low-priced pottery imports will continue to increase and take the market. This fear retards production and depresses employment. It also depresses the market. Altogether this fear upsets the healthy confidence that leads to industrial expansion and to greater employment and sustained business activity. That such fear is fully justified is borne out by the sharp upward trend in imports since the war. If the tariff is not raised and more so if it is lowered there will be no limit to imports other than existing producing facilities abroad; and these may be further expanded, as they have been since the war.

We recognize the international implications of the dollar gap and believe that it should be eliminated if that can be done without visiting distress and destruction upon our own industries. We do not accept the concept that American industries should be sacrificed on the altar of economic appeasement.

An Associated Press item from Tokyo dated November 26, 1954, indicates that Japan's foreign exchange plight is not as serious as it formerly was. The news item says that Japan's foreign trade balance has improved. Reserves are nearing $1 billion as compared with $781 million only 5 or 6 months ago.

We feel strongly, in view of the foregoing, that the items classified under paragraphs 210, 211, and 212 of the Tariff Act of 1930 should be excluded from the list of items to be negotiated with Japan on a multilateral basis under GATT.

If these items are nevertheless to be negotiated, the negotiations should be on a bilateral basis with Japan. In such a bilateral agreement, any necessary quantitative import quotas could be established as a species of stop-loss provision.

The CHAIRMAN. Does that complete your statement, Mr. Wheatley? Mr. WHEATLEY. It does.

The CHAIRMAN. We thank you for your appearance and the information you have given the committee.

Mr. Reed will inquire.

Mr. REED. Mr. Wheatley, I was quite impressed with your statement that the average age of the men in your union is 50 years. Is there some difficulty about the work? Why is that average 50 years? Does it just happen so or are there some hazards in the work?

Mr. WHEATLEY. Well, it is the old saying of "Once a potter, always a potter." They go through the training.

By the way, I want to confirm to the best of our knowledge what the other speakers have said, the speakers of the industry. We have a very fine labor-management relationship in this industry and have had it for many years.

The fact that the unemployment list is not higher in the towns where the potteries are situated is the fact that we have a division of work clause down to an impractical point rather than start knocking off the people by seniority the minute they are going to lose an hour a week. That is why he is carried along, probably, for many years over other industries. He will get a division of work where he would have probably been on the scrap heap or would have gone into something else long ago.

Mr. REED. What I noticed was if that is the average age of the workers in the pottery business, they cannot accumulate a great confidence ahead and be thrown out of work when they are 40. It is difficult for them to go into something else; is it not? Is this not a specialized business?

Mr. WHEATLEY. That is right. You see, they get old dividing work. Maybe they should have gone out someplace else. But a potter finds that he is a highly skilled handworker with his hands, and it is pretty hard for him to fit into some of these mass-production industries, especially when he hits 40 or 45.

Mr. REED. That is the point. That is what I had in mind. It is rather a difficult situation at that age. At the age of 50, he has to