President may deny relief after a finding of injury by the Tariff Commission, that at least they are making a contribution to the public welfare.

EXHIBIT A

Mr. RICHARD A. TILDEN,

New York, N. Y.

UNITED STATES TARIFF COMMISSION,

OFFICE OF THE SECRETARY, Washington, D. C., December 7, 1954.

DEAR MR. TILDEN: I have your letter of November 24, 1954, with reference to the President's letter outlining his decision in the spring-clothespin case. You state that the President's conclusions appear to have been based on certain points not covered in the Tariff Commission's report. If the Commission supplied to the President factual data which was not included in its published report, you believe that the domestic industry is entitled to see such data in order to properly evaluate its present position.

The published report of the Commission contains all the data submitted by the Commission to the President in connection with the spring-clothespin investigation.

Sincerely yours,

DONN N. BENT, Secretary.

STATEMENT OF THE UNITED STATES WOOD SCREW SERVICE BUREAU ON BEHALF OF DOMESTIC WOOD SCREW MANUFACTURING INDUSTRY

1. Domestic wood-screw manufacturers believe that revisions should be made in the escape-clause provisions of section 7 of the Trade Agreements Extension Act to assure aid to domestic industries which are seriously injured by imports. (a) Attached hereto are statistics and charts showing serious injury which increased imports have caused domestic wood-screw producers and their employees. This material speaks for itself. Visualize, if you will, what you would consider serious injury to your business or your job had they been similarly adversely affected by imports from Japanese or other foreign firms where labor is paid as low as 20 to 25 cents per hour.

(b) Here are steps which have been taken by the wood-screw industry since 1951 to obtain assistance. No aid has yet been forthcoming:

1. August 15, 1951: United States Wood Screw Service Bureau filed an application with the United States Tariff Commission for a tariff increase and a quota under section 7 of the Trade Agreements Extension Act then in force. Case dismissed December 1951 by United States Tariff Commission without a hearing. No change in tariff rates recommended.

2. April 1, 1952: United States Wood Screw Service Bureau filed second application with the United States Tariff Commission for tariff increase and a quota under section 7 based on further increase of imports since the dismissal of the first application. (See chart attached.) After an investigation and hearing before the United States Tariff Commission, the Commission decided 3 to 1 in March 1953 that no quota aid or increase in tariff rates would be recommended.

3. January 29, 1954: United States Wood Screw Service Bureau filed a third application with the United States Tariff Commission for a quota under section 7 based upon continued further increase of imports since the previous application, higher than anything which had occurred previously in the history of the industry. After a thorough investigation and hearing, three members of the United States Tariff Commission recommended establishment of an import quota and three members dissented, President Eisenhower subsequently refused to follow the recommendations of the Commission and denied relief. (Under provisions of the Trade Agreements Extension Act, a tie vote of Tariff Commissioners, where half of the Commission has recommended relief for the domestic industry, the affirmative recommendation is sent to the President for approval or disapproval.)

4. January 20, 1956: United States Wood Screw Service Bureau filed a fourth application with the United States Tariff Commission for a quota. Inasmuch as imports increased since the previous Tariff Commission investigation, the United States Wood Screw Service Bureau had every expectation that a favorable Tariff Commission recommendation for an import quota would be made.

(NOTE. Throughout the long, time-consuming procedures outlined above, applicant found the Tariff Commission and its personnel able, fair, impartial, and sympathetically helpful. We believe that the Tariff Commission fully recognizes that serious injury is occurring to the domestic wood-screw industry and would again recommend that a quota be established.)

However, based upon the limited aid given in the watch and bicycle industries by the President, and the subsequent hullabaloo both by the freetraders at home and GATT signatory countries abroad that the President, by giving any aid to seriously injured industries, was junking the trade-agreements program, the domestic wood-screw manufacturers decided hope for a favorable decision at the presidential level was very dim at that time, and requested withdrawal of the application on April 6, 1956.

2. Low-labor-cost imports from countries having entirely different standards of living should not be permitted to undermine an established domestic industry such as the wood-screw industry without some reasonable quota restrictions which prevent ruinous flooding of the domestic market and aid in the orderly transition to increasing imports.

(a) Cost differences are so great mere changes in tariff rates will not aid the domestic industry.

(b) The United States reciprocal trade program will be more likely to be advanced by the prompt establishment of reasonable quotas.

(c) With the establishment of reasonable quotas, foreign producers can participate in the domestic business and at the same time not ruin the domestic industry.

(d) Wholesale destruction of domestic industries results in bitter opposition to any reciprocal trade efforts. In opposing H. R. 5550, in a statement to the Ways and Means Committee, the domestic wood-screw industry had the following to say:

"It is a curious fact that persons who have not been seriously injured by lowlabor-cost imports, by losing their jobs or life savings, do not become excited about the injury inflicted by such imports. While many citizens of the business community are fully aware of the intensity of the competitive struggle for business on the home front, if they never have experienced low-labor-cost imports underselling their products by 50 to 100 percent, they are inclined to ignore the situation and take the attitude that 'that is the other fellow's problem.'

TARIFF COMMISSION RECOGNIZES PLIGHT OF DOMESTIC INDUSTRY

"I have represented the domestic wood-screw industry before the United States Tariff Commission on three different occasions in an effort to secure tariff or quota relief on imports of low-labor-cost wood screws. In this case tariff rates have been cut 50 percent by GATT from the duties established by Congress in the Tariff Act of 1930. At first, even the Tariff Commission appeared not to realize the serious injury inflicted upon small wood-screw manufacturers and workers in their plants scattered about the country. However, in the third petition by the domestic industry to the Tariff Commission, help came in the form of a recommendation by three of the Tariff Commissioners that an import quota be established. However, when the case was reviewed by the President and the executive branch of the Government, representing the views of the State and other Departments, the affirmative recommendation of the Tariff Commission was turned down. In fact, there was intimation that the White House would not consider under any circumstances utilizing import quotas on manufactured goods.

DANGER OF REMEDIAL AGENCIES TOO FAR REMOVED FROM SCENE OF TROUBLE

"This position has been taken even though section 1 of the Trade Agreements Act, as passed by Congress, provides for imposition of quotas if the Tariff Commission makes the appropriate findings. Those far removed from the scene of the inquiry of low-labor-cost imports quickly assume that the injury is minor and that they need not worry about it. A world organization, even an administrative one, obviously would follow a similar position. It soon would develop rigidities, redtape, and complex rules which would make the possibility of relief far more difficult than now is encountered on the domestic scene.

ONLY ONE AVENUE OF RELIEF

"The attitude of the executive branch of the Government appears to be one of ignoring the serious injury being inflicted upon domestic manufacturers and their

workers by low-labor-cost imports. There is only one avenue of assistance remaining, and that is through Members of Congress. Congressmen, who are close to their constituents, and who come from districts where employees have been laid off and where companies have lost to imports as much as half of their markets, have been quick to sense the injustice of this situation. They will not permit goods manufactured by Japanese labor, at 20 cents per hour, to undermine our domestic industries where the standard of living, wages, and other costs are far higher. We lay off our own $1.90-an-hour workers and substitute in their place foreign workers at one-third to one-tenth that wage.

GOVERNMENT AGENCIES FAR FROM DOMESTIC PLANTS

"The executive branch of the Government and the State Department in Washington are far removed from the injuries occurring to the smaller domestic industries. Even in the general business and labor-union field, as well as in Government, there is a tendency to ignore the trouble of others as long as one's 'own ox is not being gored.' However, when the injury hits home and the grave injustice of the unequal labor-cost conditions in the various countries are seen at first hand, then the possibility of aid begins to filter through to those in position to give it. Membership of the United States even in an administrative organization, as it is purported the OTC will be, further removes the possibility of a fair hearing or understanding of a domestic industry's import problem.

"For Congress to accept membership in the OTC and delegate some of its tariffmaking powers to a complicated and far-off organization with little or no reason to have the interest of our citizens at heart, would be most unfortunate. Under such circumstances, the top-level executive committee of the Organization for Trade Cooperation would continue to take an inflexible position, as GATT and our State Department already have done, that all tariffs and trade restrictions should be done away with and no relief provided under any circumstances. This policy would become frozen and efforts of our citizens to help themselves would be useless.

"Small industries, in an effort to obtain assistance, have travel and other difficulties trying to confer even with the many-membered Trade Agreements Committee in Washington and with other executive branch personnel. Membership by the United States in a world organization would greatly accentuate this difficulty. In fact, the obtaining of any help whatever appears impossible.”

3. Domestic wood screw manufacturers have been seriously injured by failure of sellers of imported wood screws to label boxes, packages and containers identifying the merchandise as imported.

(a) Under Treasury Department Customs Bureau Regulations, (see sec. 304 of the Tariff Act of 1930, as amended, 19 U. S. C. 1304) all cartons, boxes, kegs, etc., containing imported products must be marked with the name of the country of origin when the material is actually imported into the United States.

(b) However, when domestic importers, jobbers, and other resellers receive the merchandise in their warehouses in the United States, the screws are repackaged in boxes, cartons, packages, kegs, etc., without any marking to indicate that the goods are imported or the name of their country of origin.

(c) Furthermore, domestic importers, jobbers, wholesalers and other resellers also commingle imported screws with domestic screws in cartons, packages, boxes, etc., which have no marking to indicate that some of the screws are imported.

(d) As happens in most cases, domestic importers import the "heart of the line" items and expect United States' manufacturers to supply the slower selling sizes in unprofitably small quantities. The imported screws are then commingled with domestic screws without any attempt made to label those that are imported. (e) Within the past year, the United States Wood Screw Service Bureau attempted to have the Treasury Department's Customs Bureau regulations amended to require marking of individual screws. Although this is entirely practicable, this request was denied.

4. The domestic wood-screw industry suggests the following changes and additions to the present trade and tariff laws:

(a) Amend the Trade Agreements Extension Act to provide that decisions of the United States Tariff Commission under section 7 recommending relief to a domestic industry be final and controlling.

(b) Clarify section 7 of the Trade Agreements Extension Act by stating that quota relief is a proper instrument of aiding a seriously injured industry. Present section 7 appears to be clear on this point, but as there has been so much free-trade propaganda against quotas, some Government personnel seem