Lest We Forget! Who Killed Cock Robin? The U. S. Tariff -History of Coal-Tar Dyes

The Aniline Color, Dyestuff and Chemical Conditions
from
August 1st, 1914,
to
April 1st, 1917.
A series of Addresses and Articles
Compiled by:
I. F. Stone
1917

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"Article in Journal of Industrial & Engineering Chemistry"Dr. Bernhard C. Hesse

In 1914 the textile industry said to the chemists of this country:

"The appeal of the textile industry to the chemist at present is: 'We need dyestuffs, so get busy and make them; don't hem and haw, and make excuses, but get right on the job.'"

Again in 1914 the dye-users said to the chemists of this country: "Users of dyestuffs in quantity are more or less indignant over the fact that manufacturers in this country are dependent upon other countries, and Germany particularly, for the dye supply. They ask: 'Why haven't our chemical companies experimented sufficiently to produce synthetic dyes, pharmaceutical products, essential oils and synthetic perfumes, in the production of which Germany seems to have had almost a monopoly?'

"The users of dyestuffs say that the General Chemical Company, with its cash resources and its extra cash and stock dividends yearly, and other companies in a similar position, ought to have had sufficient initiative to use a portion of their large profits in experimental work, which would have permitted us to manufacture synthetic dyes without recourse to other countries and would not have permitted American manufacturers to suffer severely when imports were checked by the war. They state that the interests of manufacturers of the country should have been placed ahead of large immediate profits and unusual dividend returns to stockholders."

In view of these statements the following excerpts from the official reports of the various tariff commissions and similar committees, from 1882 forward, are not without present-day utility and interest. The views of importers, users, economists and domestic chemical and dye-makers are given quite fully; repetition has been avoided as far as reasonably practicable. For fuller information the complete originals should be consulted.

These excerpts show beyond doubt that practically every argument advanced in 1914 as to why coal tar dyes should therefore have been made in this country, was previously presented to Congress in support of the view that they should be made here.

These excerpts are here presented in the hope that careful study of them by the chemists of this country will pave the way for tariff treatment of coal tar products, inclusive of dyes, on as nearly a fair and equitable economic basis as all the circumstances may require.


REPORT OF THE TARIFF COMMISSION, 1882
LONG BRANCH, N. J., July 26, 1882.
VOL. i PP. 154-6. MR. JOHN CAMPBELL, of New York City, a member of the firm of J. Levinstein, Campbell & Co., manufacturers of aniline dyes, appeared in response to the invitation of the commission and made the following statement:

GENTLEMEN OF THE COMMISSION: We are importers and manufacturers of aniline dyes. We pay from 5 to 300 per cent duty on the different articles which we import. Our goods are used by paper-makers, manufacturers of woolens and other textile materials, and in nearly every class of industrial pursuits. We are the third largest aniline dye importers in this country, and pay annually duties amounting to nearly $100,000 upon the dyes we import. The duty now is 50 cents per pound, and 35 per cent ad valorem upon aniline dyes and colors, by whatever name known. With the exception of four small firms in the United States, who only manufacture two or three colors, out of two or three hundred imported, and who altogether do not employ more than fifty men, these dyes are all imported from Germany, England, France and Switzerland.

As I have said, these colors enter into the consumption of nearly every manufacturer of textile fabrics, paper, leather, silk, ink, matches, soap, printers' and innumerable other trades. They cannot profitably be made in this country for various reasons: First, the raw material is here in only very limited quantities; second, the acids and other chemicals used for making these dyes are not made here; third, the skilled chemists who have grown up with this particular branch of industry are very few and are all engaged in Europe.

In every country in Europe, and even Canada, these goods are upon the free list. There is one dye, wool scarlet, a substitute for cochineal, which bears a duty of 135 per cent, while cochineal, the article it is a substitute for, is admitted free. This means a tax upon every 100 pounds of woolen or worsted yarn, dyed scarlet, of from $1.50 to $2, and to every manufacturer of hosiery (shirts and drawers knitted), 25 cents per dozen of shirts.

This compound duty of 50 cents and 35 per cent is a very unequal tax, as the bulk of the dyes are only worth abroad from 50 to 60 cents per pound, whereas at the time this duty was levied, scarlet dye was unknown, and the dyes then imported were worth from $2.50 to $10 per pound in Europe. I doubt if a single consumer of these dyes would advocate the retention of this portion of the tariff. I am in favor of the free importation of these goods, but still, if a duty be requisite for revenue, then I say make it ad valorem instead of specific and ad valorem, as the SO cents per pound alone means upon some of these dyes 240 per cent duty, while upon others it means only 5 per cent.

I have no means of getting at the exact quantities imported into the United States, but from a list of the imports recorded in the Oil, Paint and Drug Reporter, which I take to be fairly accurate, I find that from January 1, this year, to June 30, there were 532,000 pounds of aniline dyes imported into the city of New York, so that it would not be far from a correct estimate to place this year's imports into the United States at a total of 1,500,000 pounds, paying a duty of $1,500,000. If these goods are placed upon the free list it will go a long way towards enabling American home industries to compete successfully against foreign manufactures in foreign markets.

The three largest importers of these dyes are William Pickhardt & Kuttroff, of New York, agents for the Badische Aniline Company, of Stuttgart, Germany; Lutz & Movius, of New York, agents for Meister, Lucius & Bruning, Hoechst-on-Main, Germany; and ourselves. Our works are at Blackley, near Manchester, England.

These three firms import more than half of all the aniline dyes brought to the United States, while the remaining half are distributed between about twenty other firms.

Aniline dyes, although a manufactured article, are really and substantially, to the American consumer, a raw material. There has been, since the tariff was last framed, quite a revolution in this trade, which has brought them from the category of a luxury to a necessary and essential product, of great importance to the industries previously stated.

All the large carpet manufacturers use these goods, and the tariff is quite unequal. When it was first framed the duty was 30 to 40 per cent, but now the duty is 300 per cent very nearly on some of the articles.


By the PRESIDENT:
Question. Will you please state what the dyes you have referred to are made of, and whether they are manufactured in England any better than we could possibly manufacture them here? - Answer. Aniline dyes are manufactured from coal tar, or gas tar it is called in England. In England they are produced more extensively than here, for one reason that the material is not found in this country in such abundance as it is in England, and for the several other reasons before mentioned. I understand that the coal found in this country does not contain so great a percentage of the light hydrocarbons as the coal found in England, therefore these dyes cannot be made here at such profit. In Germany and France they import their raw materials largely from England. Manchester is the center of production for aniline. There are four large firms engaged in the manufacture in Germany, two in France, and a few in Switzerland. The raw material at our command is not sufficient or cheap enough to enable us to make them at a profit at present, but if the duty is put up pretty high we will erect works and manufacture some of the dyes here ourselves. If the duty is taken off, this branch of industry will remain as it is at present.

Q. I would like to ask you as to the aniline dyes that are made in this country whether their quality is good and whether you are limited to one color? - A. There are three colors made in this country. One is magenta, the raw material for which is imported from England. It is manufactured here and sold at a fair price, but the quality is not such as to enable it to compete with the imported article. The firm which manufactures it is located at Albany, N. Y. I do not think they employ more than about forty men altogether. There are three other concerns, employing a dozen men. That is the extent of the manufacture at present. They do not compete with the foreign goods at all.

Q. What amount of these goods are used by the different manufacturers of colored prints, for example; I mean of these aniline dyes? - A. I cannot tell you exactly the amount the different manufacturers consume, but the quantities imported last year were about 1,200,000 pounds, paying a duty of $1,200,000. These dyes take the place of almost every color. Cochineal has been generally used for dyeing woolen goods, but wool scarlet is used as a substitute for cochineal, which comes in free, while this has to pay 135 per cent duty. They replace also archil and other barks, woods, and extracts used for coloring purposes. This whole trade is yet in its infancy. The blue article that I introduced into this country enters into the manufacture of all the paper used by the New York dailies. It sold then at $4 a pound, and it took the place of ultramarine. All the paper-makers use it. Among the consumers of aniline dyes I might mention the following: All woolen manufacturers, who use it in the manufacture of bed-blankets, horse-blankets, carpets, shirts and drawers, flannels, hosiery, domestic woolen yarns, worsted piece goods, merinos, ladies' opera flannels, wool hats, overcoatings, etc. It is also used in the manufacture of dress goods, both woolen and cotton; ginghams, prints, and cotton yarns. It is also used in all classes of paper manufacture, not only for newspapers, but for paper used for wrapping purposes, for posters, envelopes, and wall paper; also in the manufacture of straw hats, willow and wicker work, leather for chair covers, and for printing inks, especially by all label press printers, and by matchmakers and jute-carpet manufacturers.


LONG BRANCH, N. J., July 26, 1882.
Mr. JOSEPH WHARTON, of Philadelphia, representing the nickel interest, appeared before the commission in response to its invitation and made the following statement:

VOL. I-P. 205. ****** I also know something about aniline dyes, because I was invited to go into that industry, and had occasion to examine it at the time. I declined to go into it because I had so many other kinds of business on hand. The idea that we have not in this country the material for manufacturing aniline dyes is absurd. A small fraction of the waste of our gas-works would make all that the country wants. There is a lack of skill here to produce the dyes, and a certain amount of danger to life in the process of producing them. They are mostly made by the use of arsenic, which makes poisonous compounds, sometimes destroying the lives of healthy workmen, and perhaps destroying the lives of the persons who use aniline-dyed carpets or live in the rooms where the walls are covered with paper colored with aniline. But there is no trouble about the making of aniline dyes in this country. I think it is an industry that should have every measure of encouragement that the Government sees fit to give to other industries. * * * *


LONG BRANCH, N. J., July 26, 1882.
VOL. I-PP. 207-8. Mr. HENRY BOWER, of Philadelphia, made the following statement before the commission in regard to the subject of aniline dyes, in addition to his former statement on the general subject of chemicals, given on the 22nd of July:

I would like to make a short additional statement on the subject of aniline dyes. Some time ago, while this whole question was being discussed in a public way, I received a letter from Mr. H. K. Lansing, the treasurer of the Albany Aniline and Chemical Works, relating to this subject, which I will take the liberty of reading. It was as follows:

ALBANY ANILINE CHEMICAL WORKS, Albany, N. Y., February 8, 1882.
DEAR SIR: We desire to inform you that the manufacture of colors (aniline) commenced in this country, we think, in 1866 by T. & C. Holliday, who subsequently sold out to the Albany Aniline and Chemical Works, a company incorporated in April, 1868, with a capital of $25,000, and increased to $100,000. After expending all their capital on machinery and experiments in the manufacture of fine aniline colors, they reduced the capital to $25,000, and confined their attention to the production of aniline red until about two years ago, when new premises were purchased and some $60,000 expended for machinery. Chemists were brought from Switzerland and England, and we are now engaged in the manufacture of all the fine aniline blues, and expecting ere long to make all the finer colors made in Europe. As an illustration of the benefit the country has derived from our efforts, we can state that large crystals of red were sold in 1868 at $6.50, gold. We now supply the trade with an acknowledged better color at $2.50 per pound. Blues were sold one year ago at $4. Since we commenced making the price has dropped to $2.50. We think we deserve the sympathy and encouragement of the powers that be.
Very respectfully yours,
H. K. LANSING, Treasurer.

I will state that I have notified Mr. Lansing of the hearing that is going on before you, and he will appear in person and make a statement on this subject.

I desire also to add that it appears that in 1880 there were 563,932 pounds of aniline dyes of foreign manufacture, of value, with duty added, $1,600,166.48, entered for consumption, while during the last census year only 80,518 pounds were produced in the United States, in value amounting to $107,282. These figures are the most exemplary that can be given to show the depressing effect on an industry of an unpremeditated reduction of duty. Had the other 50 cents per pound been allowed to remain, the position of aniline dyes would doubtless have been about the same as licorice and borax, and the country would have been independent in this regard. Not only has the reduction of this duty prevented the manufacture from growing, until quite recently, but the danger of having another 50 cents per pound lopped off has naturally aided in hindering it, as one house sank $50,000, another $30,000, to my knowledge, following the reduction.

I am informed that the manufacture of aniline dyes in Europe is practically controlled by an English monopoly, which buys a large amount of material for this manufacture in this country, sending it to Germany and Switzerland, where these colors are produced by the poorest paid labor in Europe, and shipped to England and America. Already an extensive English house has made overtures to parties in this country, looking to the control of these products, and thus to deprive us of the raw material after present contracts have expired. I could name other articles of chemical manufacture which are held in about the same prospective condition if the large European combination should succeed in breaking through the barriers of our protective system.


LONG BRANCH, N. J., July 26, 1882.
Mr. EVERETT P. WHEELER, of Nlew York, representing the New York Free Trade Club, appeared before the commission, in response to its invitation, and made the following statement:

VOL. I-P. 223 * * * * I use in illustration of this the facts stated by Mr. Campbell, in regard to aniline dyes. It was shown by him clearly, and I think there is no dispute about that, that the cheapening the cost of production of these goods abroad has not benefited to the extent it ought the parties in this country who use them, because the duty being a fixed one of so much a pound, instead of being based on a sliding scale, the price has been kept up instead of being diminished. And, as a consequence, all of us who use printed goods of any description, or paper of any description, have to pay more in the long run than we otherwise should have done if the manufacturers could have bought a cheaper dyestuff.

P. 229 ***** Why should not, then, the third class of wools, the heavy wools, be put on the free list? That certainly would be a great benefit to the carpet manufacturers of America; and if this other suggestion made by Mr. Campbell to you should be carried out, and these aniline dyes should be put on the free list as well, the production of American carpets would be cheapened to such a degree that they could compete with great success in the South American market and in other markets. The goods we make are good in quality; a great deal of money is expended in designs for them, and I think any one who has examined the American carpets of recent make has been astonished at the amount of taste shown in the designs. * * * *

p. 230. Let me make just one suggestion on the question of dyestuffs. I want to call attention to the census bulletin in regard to the manufacture of chemicals. You will observe in regard to these dyestuffs that they have almost entirely displaced vegetable dyes. The duty in many cases amounts to more than 100 per cent ad valorem. Even if it were possible for us in this country to prohibit for the next ten years the importation of these colors, would it be a wise policy for us to do it, considering the extent to which you have been shown they enter into all manufactured goods? Would it be a wise policy for us to build up a manufactory of aniline dyes in this country when they can be made more cheaply abroad because the raw material is found in a cheaper condition in England? The English coal, as everybody knows, is richer in the hydrocarbons or inflammable matter than our American coal, and it is well known that we do import to some extent English coal to make gas, although the duty on it is a high one. The only objection that has been or could be made in regard to that would be that if we got into a war with some of the European countries we should be at a disadvantage in regard to these colors. I suggest that that is a very contingent and remote disadvantage: that the probabilities of such a war are insignificant. These goods are made not only in England, but in Germany, and if the worst came to the worst, and we were cut off from our European supplies, we could fall back on the vegetable dyes that came from South and Central America before aniline dyes were invented. * * * *

pp. 236-237. In regard to one suggestion which was made, which goes to the whole root of the matter, that it was the object of the Government to lay a tax to enable people to do a business which would be profitable, which otherwise would not be profitable, I will say this: Where that applies to large amounts of money invested, that is one thing; but where it applies to a creating of a new business that is not necessary and that the country can do without, we should pause before committing ourselves to that proposition. If there were an embargo, and we could not import anything, I suppose all sorts of industries would spring up here at once. In regard to the aniline dyes, it was said to be a poisonous business, and the people engaged in it suffered very much on account of the poisonous materials used. If that is so, why should we desire to build up a business of that kind? The gentleman from Albany, Mr. Hendrick, spoke of a 35 per cent ad valorem duty. Certainly, in the present condition of that business, considering the existing rate, I should not contest that proposition, so far as the aniline reds are concerned; I should not oppose, but consider it just to put the duty at that figure. But I should object to keeping all aniline dyes at the rate of 35 per cent so that Mr. Hendrick might be enabled to build up a new business for the purpose of increasing the cost of all articles that are made with those dyes.


LONG BRANCH, N. J., July 27, 1882.
VOL. I-PP. 253-256. Mr. JAMES HENDRICK, president of the Albany Aniline and Chemical Works, Albany, N. Y., appeared before the commission, upon its invitation, and made the following statement:

The history of our business is simply this: In 1866 my attention was called to the manufacture of aniline dyes, and I considered it a legitimate manufacture in this country which ought to be developed. Some gentlemen associated themselves together and we purchased the establishment of T. & C. Holliday, the only establishment of that kind then in this country, and began the manufacture in Albany of this article, putting in at first about $25,000 and subsequently increasing the amount to $100,000. We lost that amount of money and $50,000 additional in the business. In 1872 I took personal charge of the manufacture, and, applying to it practical business principles, found it could be made a success in certain directions. I emasculated everything from the manufacture except the article of "aniline red." We continued the manufacture of aniline red for seven or eight years and made an article, acknowledged by all manufacturers in this country, as well as those who know of it in Europe, to be equal to any thing made abroad. The price of it at that time was $6.50 in gold. We are selling it now at $2.25, and are supplying the manufacturers of New England, and today they are giving us orders for more than we can make of it. As I presume you are all aware, all these aniline colors are made from an oil procured from coal tar the benzole made from coal tar. We have been obliged to import that because of the difficulty of getting it in this country in large enough quantities to distill it. We have been importing all of this oil that we required, but now we are manufacturing it a little. I have in my pocket a sample of aniline oil manufactured from benzole, which is, in turn, manufactured from the residuum of petroleum. I have also a sample of cloth dyed with the various colors that we make ourselves. These dyes we make in our factory, but not in large quantities. We are putting up machinery now which will enable us to manufacture on a larger scale.

The Pacific Mills and other like manufactories in this country express the strongest hope that we shall receive from you the encouragement we are entitled to. In a letter addressed to me within a week by Mr. Saltonstall, the treasurer, he said there were some importers, or the agents of foreign color companies, going through the mills in New England, expecting to get a petition signed in favor of the reduction of the duty on aniline colors, and he said they would have no sympathy from them and cautioned me against them. I have no doubt you will have an application to this effect. I have not come here to tell you what you shall do. I can only point you to the evidence we have of what we have done in our little way toward reducing the price from $6.50 to $2.25, and we propose continuing that warfare. We have not made a large amount of money, and every dollar we have made we have spent in improving the manufacture of these colors, so that the investments we have made from the year 1866 up to the present time have not yielded us 1½ per cent on our money. But we are developing the business we have helped to create and the country is getting a benefit. I will leave you samples of these colors I have referred to.


By Commissioner AMBLER:

Question. As I understand the matter, this is the product you obtain from the residuum of petroleum, and you are still continuing your experiments endeavoring to extend the number of colors to be made? - Answer. Yes, sir.

Q. I do not understand that you now make a multitude of colors, so as to be able to put them on the market? A. Not all of them. We are manufacturing the colors I have exhibited.

Q. From these experiments which you have made you think you can make a variety of colors, and are putting in the machinery now for that purpose? A. Yes, sir.

Q. It has been suggested here that the raw material for making these colors is not obtainable in the United States. Is that the fact, and, if so, what is the cause of it? A. It is a fact, for this reason: That, as I endeavored to explain, the gas tar was not gathered in sufficient quantities in this country to make the benzole, and the expense of distilling benzole into aniline oil has been too large for any party to engage in it. But there are two parties now making benzole, the New York Coal Tar Company and one other, and they are exporting benzole, and we are importing the oil. If we get the oil industry started, as we expect to do, we shall not be dependent on foreigners for our oil, but they will be dependent on us.

Q. Have you taken any steps towards producing this aniline oil? A. Yes, sir; contracts are out for $35,000 worth of apparatus with which to manufacture it, and I have a chemist here from France to superintend the work.

Q. How long have you been making these other colors? I do not mean the aniline red. A. Not more than about two years.

Q. Are there any other firms in the United States engaged in the manufacture of these aniline colors? A. There are three or four, I think. There is the firm of T. & C. Holliday, in Williamsburg, N. Y.; another one in West Virginia, and one in Buffalo, N. Y. Those are the only three I know of; I have heard of others. 73

Q. Up to this time, as I understand you, this has been an unprofitable experiment? A. I cannot say that; but we have been spending a large amount of money.

Q. Have you been able to make aniline red at a profit? A. Yes, sir; we have been making it at a profit, but all the profit we have reinvested. We have upwards of $250,000 invested in the business in buildings and machinery, and this will be the result of the profits for the last ten or twelve years.


By Commissioner KENNER:
Q. Are these colors fast colors? A. They are as fast as colors can be made. All aniline colors are a little fugitive; that is to say, the sun will fade them somewhat. All the red garments you wear are made from them, every one of them. We have everything in this country that is necessary to manufacture aniline dyes. We have brains enough to do it; and I think we are as able to make them as any foreigner is.


By Commissioner AMBLER:
Q. I am requested to inquire of you (and your answer can be given now, or hereafter, in writing) what you would regard as a sufficient duty for the protection of your manufacture? A. My individual opinion would perhaps be of no more value than the opinion of any other person. We do not want to make a great fortune by large protection. 1 think, perhaps, that a fixed duty of $1 per pound would be preferable to the duty of 50 cents per pound and 35 per cent ad valorem.

Q. Would not that operate very unequally in this respect, that some of these colors are very much more expensive to produce than others? A. Yes, sir.

Q. Have you any remedy to propose as to that; that is, can you suggest any mode of making the rates equal? A. No, sir; if I were to suggest a plan I should say let well enough alone; let the business go along until it is better developed, and it will regulate itself by and by. I believe the great curse of the country today is change in these laws; and I think the less we change the tariff, as it affects commercial and manufacturing interests, the better. It is a trite saying, attributed to President Lincoln, that you should never swap horses when crossing a stream. I think that principle should apply in this case, and that when we are trying to develop a business it is not well to change the laws affecting it too often.

Q. It is complained that this is an unequal duty. The only purpose I had in asking the question was to ascertain whether you had anything to suggest which would make it an equal duty; and I now ask you specifically, would an ad valorem duty, at a proper percentage, be a fair duty? A. It would if you could get at the ad valorem; that is the great difficulty. The manufacturers on the other side of the water are exceedingly smart, and they will tamper with colors, and represent one color to be a different color; and the difficulty is in getting competent men who know the value of an article, and will place the true ad valorem on it. I have heard of expensive colors being introduced under a new name in order to get rid of the duty. Therefore, I say the other way is the more equitable method.


By Commissioner GARLAND:
Q. I understood you to say, in regard to the supply of the raw material, that you were importing it from abroad? A. We have imported all the raw material of which we make these colors, and are doing so today.

Q. Is there not enough material in this country, if it was collected properly, to furnish the supply, or what is the difficulty? A. The difficulty has been that it was not profitable to go into that branch of the business. The tar yields J4 to 1 per cent of benzole, both the American and the English tar.

Q. Is the English tar better adapted to the purpose? A. It is one-eighth of 1 per cent richer, that is all. But we think the American tar would be quite as good, the only difficulty is in getting it together and carrying it from one place to another, which would add to the cost of transportation. 75

Q. Then I understand there is enough of that material in this country, but the difficulty is in getting it together? A. Yes, sir. Even if this product of petroleum fails, which I think it will not do, there would be an abundance for our own use and that of Europe besides; I mean of the benzole extracted from tar.


By Commissioner McMAHON:
Q. If it should be decided to apply an exclusively ad valorem duty, what rate would you recommend? A. I think about 35 per cent would be fair; that is my impression about it. I should make as few changes as I could.


By Commissioner UNDERWOOD:
 Q. Would it be possible for you to furnish the commission with a schedule of duties on these different articles which would enable the Government to collect duties without ambiguity and the commission of fraud? A. Not unless you can make men perfectly honest. If we had honest men everywhere, there would be no trouble. There would be no difficulty in enforcing such a schedule in case men did not resort to dishonest practices. In that case I think 35 per cent would be about a fair rate. I think we could live if it were fixed at that figure.


 By Commissioner BOTELER: Q. You think specific duties are better for the Government and for the parties concerned? A. Yes, sir. Specific duties I believe in, because they are easily collectible, and men have no disposition to be dishonest; but with ad valorem duties the temptation to fraud is greater. That is my view of that matter. I will leave you these samples that I have referred to in my statement, and, if you desire, I will give you any further information I possess, from our books or in any other way.


LONG BRANCH, N. J., August 21, 1882.
VOL. I-PP. 565-568. The following communication, regarding duties on aniline dyes and coal tar products, was received from Mr. V. G. BLOEDE, representing the American Aniline Works, of Parkersburg, W. Va.: 76

GENTLEMEN: Having found it impossible, during my recent hurried visit to New York, to accept your invitation to appear in person before your committee, I adopt this method of communicating my views upon some of the matters you now have under consideration.

The firm of Bloede & Rathbone, of which I am a member, is engaged at this point in the manufacture of various chemicals, chiefly such as are used in the dyeing and printing of yarns and textile fabrics. Our firm is also largely interested in the business known as the American Aniline Works, and it is particularly in this line of manufacture that I feel competent to communicate important information to your committee. The production of aniline colors from our native crude materials is a business, the benefits of which seem to me to belong most legitimately to this country, and forms a fitter subject for heavy, even prohibitory, duty than many other branches of trade depending exclusively upon imported crude material. Strange to say, although we have all of the chief crude materials in this country, it is only within the last two or three years that the production of colors exclusively from our native products has been attempted. Prior to this time a few small works had been engaged in the manufacture of a few simple coal tar dyes, but they worked exclusively with a crude material, combined and manipulated by European skill and imported into this country, duty free, in a half finished condition, i. e., in the form of arseniate of aniline. To produce this material, American benzoles and other coal tar products are shipped abroad in a crude state at a heavy expense, manipulated by foreign skill and labor at another heavy expense, and returned to us still as a crude product, but largely enhanced in value. The entire profits of manipulating our own crude material have thus for years been lost to our country. I believe I am correct in stating that the American Aniline Works, which I have the pleasure of representing, was the first concern in the United States which succeeded in producing on a large scale the base used in the manufacture of these colors, *'. e., aniline oil, from the crude coal tar products of our own 77

country, and exclusively by home labor. It is not necessary for me to dwell upon the almost insurmountable difficulties encountered in a new manufacture of this kind in a country totally devoid of skilled labor and experience. It generally means one of three things: first and generally, a total failure; second, the importation of skilled labor from the other side (a class of labor which seldom flourishes under the business conditions here existing), or, as the American Aniline Works have done, the redevelopment, as it were, of the entire process of manufacture by a long series of difficult and costly experiments. One thing that is retarding the utilization of our home products more than anything else is the fact that, by the grossly unjust and arbitrary provisions of some sections of our tariff, aniline oil, and the half finished product known as arseniate of aniline, have been hitherto admitted free of duty, a provision wholly and exclusively to the benefit of the foreign producers. The natural result has been that no American manufacturer could be found willing to devote his time and capital to the development of a branch of industry in which Europe has the advantage of twenty-five years' experience. To insure the utilization of our own coal tar products under the best possible conditions for success, I would most urgently request that your commission recommend a duty to be placed upon the two crude materials named, as well as any others that can be produced here, so as to insure to our country the benefits derived from the consumption of our own coal tar products. In my opinion, had our tariff not been defective in this vital particular, and aniline oil and its compounds had early paid duty, the manufacture of the articles from our own crude coal tar products would have been an assured fact years ago. I believe that our people are fully competent, not only to hold their own against the competition of other nations in any manufacture, but that they are their superiors in many essential particulars. At the same time it is absolutely necessary that a new enterprise of this kind, in order to compete successfully against the products of a quarter of a century of European research and experience, be liberally protected until our own manufacturers have acquired sufficient knowledge and experience to enable them to hold their own against these odds. I would therefore urge that aniline oil, arseniate of aniline, and other salts of the base be protected with a specific duty of from 5 to 10 cents per pound. I would also urge that the duty on the intermediate products, such as nitrobenzole, and binitrobenzole, and its homologues, be maintained. The duty on nitrobenzole is now 2 cents per pound, while binitrobenzole, which is merely nitrobenzole combined with more acid, pays a duty of 20 per cent. I would recommend that the duty upon all nitro compounds of benzole and its homologues be made a uniform one of 10 cents per pound, as in the case of nitrobenzole.

I have carefully examined some of the statements made before your commission, and must say that some of those presented on behalf of the foreign manufacturers are certainly extraordinary misstatements of facts. Mr. John Campbell, for instance, appeared before your commission, and, unless the press misrepresented him, made the remarkable and wholly erroneous statement that a color costing $1 per pound in England would, under the present duties, cost $4 per pound laid down on this side. This is such a very gross misstatement of the facts that I hesitate to believe it was seriously offered to your commission. Such a color as Mr. Campbell speaks of, after payment of all duties, freights, and the like, would cost less than onehalf that sum, say $1.90 per pound. The result of home competition is already so strongly felt in some lines, for instance fuchsine and other reds, as almost to have stopped all importations, and it is my opinion that within a short space of time these colors can be made as cheaply in the United States as in any country of Europe. This is the direct result of protection and the stimulation of home enterprise, and there is no reason whatever why, within ten years, or even a much shorter period, if we are only able to avail ourselves, by means of a liberal protection, of our domestic wealth in crude material, all other coal tar colors should not be in the same position.

Whatever course your committee may take as regards the older chemical industries of this country, I would urge that the aniline branch be liberally protected at least for a few years. As before stated, it is an industry so new that up to two years ago not one pound of the base used in the manufacture of these colors was made in the United States.

A great deal has been said, and with much force, upon the nature of the duties imposed on aniline dyes, and the injustice resulting therefrom. A duty like the present one, of 50 cents per pound and 35 per cent ad valorem, I believe to be wholly wrong. It annually deprives our Government of thousands of dollars of legitimate revenue, and entails an enormous and unnecessary expense in collection. Many of the manufacturers on the other side have resident partners here, and it is the general impression that an enormous amount of color finds its way into this country under the ad valorem system at a very great undervaluation. That this system of collecting duties at least opens the way to a great deal of fraud will be seen at a glance by your commission, when I state that the various aniline blues, for instance, range in price from $2 to $15 and $20 per pound. The difference is not one of strength, but only of purity and quality of shade, some high-priced colors being actually weaker in point of strength than others of a low price. These colors are sold under arbitrary names and marks, such as B, BB, etc., up to 5 B or 6 B. Now, suppose an unprincipled person wishes to undersell his competitor, all that he has to do is to mark his 5 B, or 6 B, or other mark, worth, say, $12 per pound, down to B or BB, worth, say, $3; the result is the evasion on his part of 35 per cent duty on $9 of each pound of this color, or the enormous sum of $3.15 on every pound. It is utterly impossible for the largest corps of experts the Government can command so to test the samples as to make such frauds impossible. The interests of the Government, the consumer, and the honest dealer, require a change of this system to one of specific duty, or so much per pound of color. The average value of the aniline dyes imported into this country we will say is $6 per pound. Under the 80 present system, such a color would pay a duty of $2.60 per pound, and I would recommend that a uniform duty of from $1.50 to $2 per pound be imposed upon all aniline dyes of whatsoever name or quality. While it is true that such duty would be prohibitory as regards the cheaper grades, the answer to this is, that such dyes can and are already produced in this country at a price to exclude, or almost exclude importation, even under the present system of duty. By adopting a specific duty a large expense would be saved the Government in the collection of the duties, a larger revenue would result, the consumer would be largely benefited by the higher grade of the colors, and honesty on the part of the importer would be insured, as it would necessarily break up the system of undervaluation, or cost invoicing, adopted by many of the European manufacturers having resident partners on this side. Should an ad valorem duty be continued, I would urge your committee to move a Congressional investigation having for its object the breaking up of the system now in vogue for the evasion of duty.

Some efforts have been made to show that the present rate of duty on these dyes is very onerous to the consumer and the public; such is not the case, however, for two reasons: first, because the branches of business consuming them are themselves protected by almost prohibitory duties, and lastly and chiefly, because the quantity of dye used per pound of cloth or yarn is almost infinitesimal. Taking the case of fuchsine, for instance, a color costing only $2 per pound, but four or five ounces are required for every 100 pounds of carpet-chain; this means a tax through present duties of only 3 or 4 cents on an average size rag carpet. The fact is that while a removal of the duties would deprive the Government of a large revenue, and kill the home industry outright, no one class, except the foreign manufacturer, would be benefited. This was shown a few years ago in the case of artificial alizarine. By the assistance of the consumers the duty was removed from this article, ever since which time the said consumers have to pay about as much again for the article as their foreign competitors, and the large revenue that would have resulted to our people by a duty was absorbed by the foreign manufacturers and their agents. It is therefore desirable that neither the Government nor the consumer be again inveigled into such action on behalf of a wholly foreign industry.

Before closing I would call the attention of your committee to the fact that, owing to the vitality the American aniline manufacture is beginning to show in the last year or two, the foreign manufacturers of these dyes have combined for a concerted action, and are making extraordinary efforts looking to the repeal of the duties and the killing of this promising industry. Among other devices adopted, is the one of obtaining signatures to petitions among the consumers of these dyes, asking for a repeal of the duties. These petitions have been gotten up by the New York representatives of a large foreign corporation, and are being extensively circulated for signatures. I state this so that when such petitions are presented it will be understood that they are not the sentiments of the American consumers of these dyes, who, as far as my knowledge enables me to speak, are universally in favor of and willing to pay their quota towards the successful introduction of this manufacture in the United States. The actual disposition of the largest consumers of the anilines is fairly represented by the following sentence in a letter recently received by me from one of these consumers: "The representatives of a large European aniline works are making a great push to have the duties on anilines reduced. I inclose you their circular which they are sending to all the manufacturers to obtain signatures. What do you as a manufacturer think of it, and what would you propose? We can stand it as it is, and, having all the protection we need on our manufactures, are willing to give all that is required to others."

I have the honor of remaining,
Very truly yours, V. G. BLOEDE.
Parkersburg, W. Va., August 10, 1882.


BOSTON, MASS., August 24, 1882.
VOL. I-PP. 661-663. Mr. HENRY A. GOULD, of Boston, refiner of camphor and manufacturer of aniline dyes, addressed the commission as follows: * * * *

I hope that the commission will be able to recommend a reduction of the duty upon aniline colors. The duty now, as you well know x is 50 cents a pound specific duty, and 35 cents a pound ad valorem. I represent a house in Germany, with a capital of $10,000,000 or $12,000,000, and we sell the goods in the original package in this country. I have reason to know that the duty is so high that it leads, in the first place, to corruption and misrepresentation of goods brought into this country. Without desiring to make any definite statement, I may say that I feel that goods are, owing to this high duty, often brought in on a wrong valuation in many respects. The argument on this question has been gone over before you very fully by Mr. Campbell, but I may say, in brief, that a duty of 20 or 25 per cent would answer all the purpose of protection, as I have instanced in regard to the matter of camphor, and would help the manufacturer, without being a burden on the manufacturer of textile articles. I paid a visit to South America last summer, and while there could see the reason why they imported their goods from England rather than from this country. The 3 or 4 per cent which is added on to the cost of American goods by reason of this heavy duty on the raw materials used in their manufacture is the cause of it. Our house in South America imports hundreds of packages of goods from Manchester and other sections of England that we should import from this country if the prices were lower. Of course, every tax of this kind that is added to the original cost of the goods acts as a prohibition upon trade from this country. We have a house in South America for which we import largely from England. The freights on goods exported from this country to South America are much larger than they are on goods exported from England, and, of course, the percentage of cost for these pigments and colors adds very largely to the cost of the print or the manufactured article.

I think a moderate duty would do away with the tendency to undervalue these colors when they are imported. At the present rate of duty it is certainly a very great temptation to fraud.


By the PRESIDENT:
Q. How much does the duty on aniline colors affect the price of the ordinary American prints, for instance?
A. I am not prepared to answer that question exactly: but I know that we have very carefully prepared tables showing the cost of prints imported from Manchester and the cost of prints and other colored goods made in this country, and the difference is considerable; and, of course, as you can see, every additional tax on the manufacturer adds to the cost of the manufactured article. A duty of 25 per cent would answer all the purposes of protecting the American manufacture of aniline colors, as I have instanced in the case of camphor, without adding as heavy a tax to the user of aniline colors. As Mr. Campbell has said, there are from one to two million pounds of colors, representing millions of dollars in value, imported annually into the country, but yet the business is in its infancy. I imported in 1866 the first aniline colors ever brought into this country.

 Q. What colors were they?
 A. They were blues and reds. I had very hard work to dispose of my first consignment of 1,000 pounds; it took me nearly six months to do it. But in the next six months I sold from $50,000 to $75,000 worth, and the business has increased very rapidly ever since. I am satisfied we cannot manufacture these dyes in this country as well as they can abroad, unless there is a change in the prices of labor and in other particulars. In Germany laborers are paid from 60 cents to $1.12, while the same laborers in this country receive from $1.50 to $2.50 a day. Alcohol is very cheap in Germany, while here it is loaded down with taxes. Nitric acid there is cheap, while here it commands a very high price per ton. And so I might go through the whole catalogue and name the elements that enter into the production of these colors. I should be very glad to see them made in this country, and even as an im
84

porter would readily submit to a fair rate of protection in order to develop that industry. There are only three or four companies in this country manufacturing these colors, and with every advantage of protection they have kept the price up as high as the tariff would allow them to, and made the manufacturers pay a royal price for their colors, and the textile manufacture has not been benefited by it, and they never have been able to make one or two of the last colors. My house, in Germany, manufactures some two hundred colors, while such concerns as the one in Albany, the one in Buffalo, and one or two in Philadelphia, manufacture only one or two colors. There are a dozen companies in Europe having a capital of from $12,000,000 to $15,000,000, some of them; even the smallest of them have at least a million dollars capital, and in that way they can manufacture to very great advantage. I am speaking now of aniline colors, without reference to alizarine, for that is a monopoly under a patent.

Q. Is the price of alizarine due to the high tariff?
A. No, sir; it is a free article; it is due to the control by one house of the patent under which it is made; it is a monopoly. We represent a manufacturing house in Austria which makes it, but we are prohibited selling it in this country, under a decision given by Judge Lowell. The decision is regarded in Europe as unsound, but nevertheless we have to abide by it.

Q. How much lower are the European users able to buy this alizarine than American users? A. I could not answer that question, because since we were enjoined from selling the article I have not followed the price of it. I only know that after the decision of Judge Lowell the manufacturers here raised their price over 100 per cent in a very few months.


The PRESIDENT. I wanted to bring out the fact that the high price of alizarine, one of the most important of the aniline colors, is not due to the tariff.

THE WITNESS. A specific duty in one sense would be an unjust one because of the fact that the colors are valued at different prices. A low ad valorem duty of 20 to 25 per cent, it seems to me, would answer every purpose and protect the American manufacturer. As it is now the profits all go into the pockets of these few manufacturers. A reduction of the duty would reduce the price to the consumer, and enable him to produce the better article which is made abroad. I suppose there are some things that we cannot make in this country, which we shall have to let other people in other countries make for us.


BUFFALO, N. Y., August 30, 1882.
VOL. I-PP. 749-750. Mr. J. F. SCHOELLKOPF, JR., of Buffalo, manufacturer of aniline dyes, addresses the commission as follows:

GENTLEMEN: In addition to my communication of July 27, 1882, I desire to call your attention to the following circumstances: Coal tar is procured from bituminous coal; benzole, the raw material for aniline oil, is gained from coal tar by distillation. Now, benzole pays a duty of 40 cents per gallon, whereas aniline oil comes in free. These facts certainly must have been misrepresented at the time the present tariff was framed, for it is evident that if the raw material, benzole, is protected, the manufactured article, aniline oil, is justly entitled to the same privilege. Aniline oil, which is used directly for printing black (on cotton), cannot be manufactured as cheaply here as in Europe, owing to higher labor and high prices for acids (sulfuric and nitric acids) used in its manufacture.

I have learned that New York and Boston parties are circulating a petition among the larger consumers of aniline dyes, with the intention of reducing the duty on such dyes to 25 per cent ad valorem only. This would leave domestic manufacturers virtually without protection. We must have an absolute protection, and this can be realized only by a specific duty. I would suggest the raising of the specific duty 25 or 50 cents per pound and dropping the ad valorem duty altogether. This would enable home manufacturers to compete with foreign producers.

By Commissioner AMBLER:
Q. Would not that operate inequitably by reason of the fact that there is a great difference in these dyes? Some of them, I understand, are cheap and others are expensive.
A. Yes, sir.

Q. How do they range in price?
 A. From $1 to $5 per pound; the principal colors.

 Q. I would suggest that a specific duty per pound, to afford any protection at all on the $5 article, would be too much on the cheaper article.
 A. But as I mentioned in my former communication, if we have protection, the domestic competition will reduce the price to a proper level. There are only five manufacturers of aniline dyes in the United States at the present time.

 Q. Is it not a fact that any rate that operated as a protection on the $5 article would amount to a prohibition on the article that costs $1?
 A. It does not seem so, for they are still importing fuchsine, which is a color worth from $2 to $2.50 a pound.

 Q. Did you mention any specific amount of duty per pound which you think would be proper?
 A. Yes, sir; the rate of duty now is 50 cents a pound, and 35 per cent ad valorem, and I suggest dropping the ad valorem rate and raising the specific rate 25 or 50 cents per pound.

 Q. You mean, raise it 25 or 50 cents above the present duty of 50 cents?
 A. Yes, sir.

  Q. That would amount to a duty of 100 per cent on $1 dyes, and a duty of 20 per cent on $5 dyes? A. Yes, sir; but, as I mentionel in my former communication, under these ad valorem duties imported dyes are liable to be undervalued.
 
  Q. Are they generally undervalued?
  A. I do not know, but I think they are because it cannot very well be detected. I suggest this high duty in order to give the home manufacturers a start. After five or ten years it would not matter if the duty were taken off; but we must have a large protection to enable us to start. When I was in Europe this spring I was told that if the duty was not taken off in this country the manufacturers there would start establishments in this country, so that we would have plenty of competition.
 
 
  By the PRESIDENT:
  Q. Will you please repeat that statement; do you say that the foreign manufacturers themselves would begin the manufacture in this country?
  A. Yes, sir. The president of the largest manufactory in Europe, the Badische Aniline Factory, at Mannheim, told me personally that if the duty was not taken off they would be obliged to start factories over here. I think that shows that the price today in this country is as cheap as it can be.
 
  Q. How many dyes does that establishment now make?
  A. They make almost all the known colors. Dyes can be made here, in time, as cheaply as in Europe; but we must have a chance to start the business.
 
 
  NEW YORK, October 7, 1882.
  VOL. I-PP. 1960-1962. The following communication from Mr. A. KLIPSTEIN, of New York, in regard to the duties on dyestuffs and chemicals, was ordered to be printed:
 
  I would recommend putting upon the free list every dyestuff and chemical used in dyeing, calico printing, etc., and every chemical used in making paper, soap, and glass, in bleaching and other industries. These articles may be fairly classed as raw materials for the use of these industries. If these various industries could get their dyestuffs and chemicals free, the saving to them would be so considerable that they would be upon a much better footing for competing with the foreign manufacturers, and it would lead to a large increase of the export trade in their products. * * * * *

Aniline dyes and colors should be made free. They pay now the enormous duty of 35 per cent ad valorem and 50 cents per pound. At the time the tariff was framed these colors were comparatively little known, and their importance not recognized. Their price was at that time very high, and the 50 cents per pound specific duty was not felt so much. Since then great progress has been made in the manufacture of these dyes, the prices have been very considerably reduced, and large quantities are used.

The difference in duty which our print works, woolen mills, dyers, etc., have to pay is in many instances very considerable, many mills using large quantities, and the saving would amount to each of them to many thousand dollars per year.

The duty on the lower-priced colors, in consequence of the 50 cents per pound specific duty, amounts to 130 per cent. Notwithstanding this enormous duty, there is only a very small quantity (comparatively) of aniline colors made in this country, and the industry has made no progress here in twenty years. This is owing to many circumstances.

 What is made at Albany, N. Y., and at some other small factories in the United States, is only the first stage, viz., fuchsine (red). The higher class of colors are not produced, and it is not likely that they will be made of good enough quality.

 It is not just that large industries (like the cotton, woolen, silk, calico printing, etc.) should be taxed heavily to support these small factories.

 Other dyestuffs and chemicals are used in dyeing, calico printing, etc. some of these are already on the free list, while others are taxed for no apparent reason. It does not appear, for instance, reasonable that such articles as archil and extract of archil, cudbear or extract of cudbear should be free of duty while the following articles are taxed; for if a high enough duty was imposed on the above, no doubt they would also be made here. * * * * * * *

  Through these tariff restrictions our manufacturers of textiles, etc., are prevented from using to advantage many articles like carmines, lakes, and other special preparations for calico printing, etc., which their competitors in Europe can employ.
 
  Madder lake is taxed 25 per cent, but on the other hand extract of madder is free; naphthalene yellow and naphthalene brown pay 35 per cent and 50 cents per pound, as aniline colors, under the similitude clause, although they are not aniline colors, not any more than other products now assimilated to aniline colors and paying the same duty.
 
  If every article used in dyeing and calico printing were put on the free list, this would do away at once with the many vexatious difficulties resulting in appeals to the Secretary and in lawsuits, which are caused by the present complicated state of the tariff.
 
 
PHILADELPHIA, PA., October 16, 1882.
The following report of Mr. GEO. C. TICHENOR, special agent of the Treasury Department, addressed to the Secretary of the Treasury, in regard to importations of foreign goods, having been referred to the commission for its information, was ordered to be printed:

VOL. I-PP. 2486-2488. PAINTS AND DYES ANILINE DYES AND COLORS (1350 Heyl). Like the preceding provision, concerning "statuary," this one has provoked much discussion and controversy; has been variously construed by customs officers; has resulted in lawsuits, and has caused the department a vast amount of trouble and vexation. The tariff act of June 30, 1864, provided that "aniline dyes" should pay duty at $1 per pound and 35 per cent ad valorem. At the period of the passage of this act the industry devoted to the production of these dyes was in its infancy and had scarcely developed beyond an experimental state. The products were then derived exclusively, I believe, from a single hydrocarbon resulting from the distillation of coal tar, then exceedingly expensive, and which was called aniline a mere arbitrary and accidental name, which owes its origin to the circumstance that its coloring principle was, I believe, first discovered by a Portuguese chemist, through the destructive distillation of indigo, which is known as "anil" in the language of Portugal. At that time (1864) these so-called aniline dyes were enormously expensive, had not entered into general use in the arts of dyeing and printing, and it was not thought that the high rate of duty would burthen our textile industries or be at all generally felt. It was also, probably, the intention to encourage and foster the production of these dyes in this country. It should also be borne in mind that we were then in the midst of the war period, and were legislating to increase our revenues. Dyes that were then worth in Europe say $30 per pound are now scarcely worth $3. So that at that time the specific rate of $1 per pound was a comparative trifling matter.

The act of July 14, 1870, fixed the duty on "aniline dyes and colors, by whatever name known," at 50 cents per pound and 35 per cent ad valorem. Although great progress in the industry had been made by this time, and the cost and price of the dyes had been much reduced, they were still of high price, were being produced from the same source, and had not come into general use. Efforts had also begun to be made to build up the industry in this country, and the protective idea was in consequence perpetuated in the new act.

 Within the twelve years past far greater progress has been made in this industry in Europe than in all previous time. In addition to reducing the cost of production and selling price of the original aniline dyes proper to a fabulous extent, and thereby vastly extending their use, a vast field of new and useful dyes have been produced from naphthalene and other coal tar derivatives, which, coming from a cheaper source than aniline, have been produced at still diminished cost, and have come into quite general use as substitutes for many of the old vegetable and other organic dyes, including cochineal, logwood, and indigo, while madder has been almost entirely supplanted by a dye called alizarine, produced from anthracine; this latter dye having been originally classified as a manufactured article not otherwise provided for at 20 per cent ad valorem, the other newly-discovered dyes, produced from other coal tar derivatives than aniline, were entered and largely passed under the same classification as alizarine, which also led to entering many colors mainly produced from aniline at the same rate of duty, while others again were entered and passed as paints, etc. The department's attention having been brought quite fully to the subject, it was held in numerous decisions that dyes or colors produced from derivatives of coal tar other than aniline were subject to duty as "aniline dyes and colors," in accordance with the provisions of Section 2499, Revised Statutes, from which decisions and assessment of duties numerous appeals have been taken, and some suits brought for the recovery of duties in excess of 20 per cent.

 Alizarine, so-called, was taken out of the controversy by the act of February 8, 1875, by being placed on the "free list" with "madder and munjeet," which it had largely superseded. All these coal tar dyes are familiarly commercially known as aniline dyes, or aniline colors, and I can see no reason for putting alizarine on the free list that would not apply both to its older and younger associates, a number of which pay duty in excess of their actual cost in the country of production. I think no candid man who understands the subject will contend for a moment but that all of these dyes, "by whatever name known/' coming from any of the series of coal tar hydrocarbons, should be subject to the same rate of duty so long as they remain dutiable; they all come from the same parent source, take the same place substantially in the arts, and are used for the same purposes; those being for coloring silks, woolens, cottons, jute, flax, leather, and other substances, as well as for the manufacture of different colored writing and printing inks, artists' and painters' colors, etc., in which manufactures they are in the nature of raw materials. It requires expert knowledge of the very highest order, aided by most exhaustive chemical analysis, to determine whether one of these dyestuffs, as imported, comes from aniline, naphthalene, or some coal tar product; so that they should all be included under one and the same head in the tariff. I incline to think a provision in substance as follows would meet the case, vis.: "All paints, dyes and colors, produced in whole or in part from coal tar or its derivatives." This, it will be seen, would include some articles, notably alizarine and picric acid, now on the free list, and hence would admit of a large reduction in the rate of duty without decreasing the aggregate amount of duty derived from dyestuffs. And since all these dyestuffs enter into the same uses as the large number of organic dyes and coloring matters now on the free list there is apparently no good reason why the latter should not, as well as the former, pay duty.

 The experience of the last eighteen years has, I regret to say, shown that a high protective duty has not resulted in the building up of anything worthy of the name of an aniline color industry in this country, notwithstanding it is understood that there is an abundance of the raw materials here, and aniline oil and arseniate of aniline have been admitted free of duty. There are, to be sure, a few small concerns making certain classes of colors, but these employ so few people and produce such limited quantities of dyes as hardly to amount to an industry worth protecting at the expense, at least, of burthening and crippling the vast industries devoted to the manufacture of textile fabrics, as well as to putting a tax upon the consumers of such fabrics.

 Having, after much inquiry and experience, ascertained beyond question that aniline dyes imported into the country have been largely undervalued, and that it is practically impossible to prevent such undervaluation so long as they are subject to an ad valorem duty high enough to present any inducement of consequence for undervaluing, I am convinced that it would be advisable to retain the specific feature with an ad valorem rate sufficient only to serve as an equalizer, and not to exceed 15 per cent. I have thought that 25 cents per pound and 15 per cent ad valorem would be as high a rate as could be asked for purposes of protection. This would amount to near 40 per cent on a very liberal proportion of the dyes most used, and to about 60 per cent upon some of them.

I was informed while in Europe that the use of arsenic in the manufacture of all coal tar dyes had been prohibited by the German government, and perhaps by others, not only on account of the danger to the life and health of those engaged in their production, but also to those who wear garments and live in rooms where the carpets, curtains, and papered walls have been dyed or printed with such arsenic colors.


REVISION OF THE TARIFF HEARINGS BEFORE THE COMMITTEE ON WAYS AND MEANS, 1889-90
NEW YORK, December 10, 1888.
PP. 393-398. The Subcommittee on the Tariff of the Senate Committee on Finance:

The undersigned manufacturers of coal tar dyes beg leave to present the following statement with regard to the tariff bill now under discussion:

The great difference in the cost of raw material, both imported and domestic, and the still greater difference in the price of labor between here and Europe, makes it impossible for the home manufacturers to successfully compete with those of Europe, even if the duty of 35 per cent be actually paid.

Annexed schedule will show clearly the disadvantages under which we labor.

We also submit a statement of one of the largest factories in Europe showing their consumption of raw materials and products for one year, thus illustrating the importance of this industry for the United States, if fully developed by a protective policy.

In order to give the domestic manufacturer a safer protection, to enforce a strictly honest entry of values, and to insure the importation of the best quality of goods only, we suggest that a specific, or at least a partly specific duty be imposed.

To overcome the apparent difficulty of equalizing the duty on the various priced goods more justly, we propose to separate coal tar dyes into two classes, which can easily be distinguished, and which would also separate the highpriced colors from the cheaper ones, viz.:


 COAL TAR DYES AND ACIDS OR BASES OF COAL TAR DYES

Class I - Azo colors, picric acid, and naphthol yellow, 25 per cent ad valorem and 10 cents per pound gross weight.

Class II -  Non-azo colors, 25 per cent ad valorem and 25 cents per pound gross weight.

Our authority for this classification is the list of coal tar dyes as compiled by Gustave Schultz and Paul Julius, and published by R. Gaertner, at Berlin, in the year 1888.

This book not only gives the scientific and trade names, but also a description of the outward appearance of all coal tar colors and their action when treated with certain named re-agents, thus clearly establishing the identity of the respective dyes.

Very respectfully,
 ALBANY ANILINE COMPANY.
 SCHOELLKOPF ANILINE AND CHEMICAL COMPANY.
  HELLER & MERZ.
  HUDSON RIVER ANILINE COLOR WORKS.
 
We also beg to call your attention to the following: Under "paragraph 974" aniline oil is free. We would suggest to strike out the words "aniline oil" and insert the words "commercial aniline oils." All aniline oils are mixtures of several products, but the law as it now stands is liable to be misconstrued by the custom-house officials.


SCHEDULE SHOWING THE CONSUMPTION OF RAW MATERIAL AND PRODUCTS FOR THE YEAR 1887-'88, BY FARBWERKE, VORM. "MEISTER, LUCIUS AND BRUENING," AT HOECHST-ON-THE-MAIN
- Long tons
Coal 64,230
Coal-tar products 3,624
Caustic soda 2,112
Different potash salts 350
Soda 1,610
Nitrate of soda 1,905
Pyrites 12,661
Iron borings 1,503
Methylated and ethylated spirits 309
Various chemical products 1,635
Rock salt 10,518
Lime 4,312

Should this factory be located in the United States 93 per cent of the above material would have to be produced in our country, 2 per cent nitrate of soda would come from South America, and of the remaining 5 per cent, consisting of "coal tar" and various chemical products, a large part, if not the whole, would be manufactured in America.

To ship the manufactured products of above factory the following packages were used:
Casks 25,310
Tins 1,962,000
Bottles 803,200
Cases 25,310

The effect on the carrying of such an establishment can well be imagined.

This house was founded in 1863, and commenced operations with one 3 horse-power steam engine and 7 employees, which have been increased in the comparatively short time of twenty-five years to 1,840 horse-power and 2,062 employees.


SCHEDULE SHOWING EFFECT OF THE PROPOSED CHANGE OF DUTY ON THE PRICE OF THE MOST IMPORTANT COLORS NOW ON THE MARKET

CLASS I Azo colors, etc. | Cost in Europe Cents  | 35% Cents | 25% and 10c. per lb. Cents
Orange Y  | 22  |  29.7  |  37.5
Orange R  | 25  | 33.75  | 41.25
Orange No. 4  | 60  | 81.5  | 85
Metanil yellow  | 75  | 101.25  |  103.75
Chrysoidine  | 40 | 54  | 60
Bismarck brown  | 72 | 97.2  |  100
Scarlet 2 R  | 27 | 36.35 | 43.25
Scarlet 3 R  | 34,5 |  46.57 |  52.1
Fast red  | 22 | 29.7  |  37.5
Crocein scarlet  | 47 | 63.5 | 68.75
Benzo-purpurine 4 B  | 100 | 135 |  135
Chrysamine R  | 100 | 135 |  135
Hessian purple  | 100 | 135 |  135
Hessian yellow  | 100 | 135 |  135
- |  824.5 | 1113.52 | 1169.10

Cost in Europe, 100 per cent.
Present duty cost in United States, 135 per cent.
Proposed duty cost in United States, 142 per cent.


CLASS II - Non-azo colors. | Cost in Europe  | 35%  | 25% and 25c. per lb.
Auramine  | $2.00  | $2.70  | $2.75
Victoria green  | 0.72  | 0.972  | 1.15
Acid green  | 1.00  | 1.35  | 1.50
Victoria blue  | 1.40  | 1.89  | 2.00
Fuchsine  | 0.84  | 1.13  | 1.30
Violet crystals  | 1.67  | 2.25  | 2.34
Violet 3 B  | 0.80  | 1.08  | 1.25
Cotton blue 5 B | 2.90  | 3.91  | 3.875
Cotton blue B  | 1.50  | 2.02  | 2.125
Methyiene blue  | 2.11  | 2.85  | 2.89
Eosine |  1.25  | 1.635  | 1.81
Erythrosine  | 3.00  | 4.05  | 4.00
Rhodamine  | 5.00  | 6.75  | 6.50
... | 24.19  | 32.637  | 33.49

Cost in Europe, 100 per cent.
Present duty cost in United States, 135 per cent.
Proposed duty cost in United States, 138.4 per cent.
(142 + 138.4) / 2 = 140.2.
140.2 - 135.0 = 5.2.
-"- Average higher duty under proposed duty = 5.2 per cent.

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VIEWS OF FRED. KOEHLER WASHINGTON,
D. C, December 13, 1888.
The Subcommittee on the Tariff of the Senate Committee on Finance:
Mr. Pickhardt, in his statement regarding the manufacture of aniline colors in this country, having alluded to myself to sustain his assertion of the impossibility to make said dyes here, I beg leave to submit the following:

I was employed as chemist in the largest aniline color factory in Germany and in the world from 1874 to 1883, and as such have had in my hands and am familiar with the manufacture of all aniline colors known up to that date. I subsequently was engaged for over five years in the aniline color manufactory in this country, and I therefore believe myself more competent to judge about the possibility or impossibility of making colors here than Mr. Pickhardt. This gentleman having never been a manufacturer of coal tar dyes himself, can only express the views of his friends in Germany about this matter or possibly the views they wish to impress upon your committee. If they really are convinced that aniline colors never can be profitably produced here, why are they not willing to let the American manufacturers die a natural death instead of trying to kill them quickly by having the duty removed, trying it even to the point of raising money among the German aniline color manufacturers for that purpose? I, for my part, am firmly convinced that aniline colors can and will be made here, and, as a matter of fact, about 20 per cent of the home consumption are actually made here.

I am further convinced that had the duty not been lowered in 1883 not one pound of aniline color would be imported today.

It is true we did not succeed nearly as well as I expected, but that does not prove the impossibility to succeed finally. In the light of my knowledge of the circumstances under which this industry exists here and abroad, I find the reasons for its slow progress here chiefly as follows:

(1) In the very large difference in wages. An ordinary laborer in German aniline factories receives at the utmost 58 cents for eleven hours' work, while we must pay from $1.25 to $1.75 for ten hours.

(2) In the large difference in the cost of raw material.

(3) In the difficulty we have in selling our goods. There are now about twenty agents of foreign manufacturers established in this country, who until recently have had practically the whole market, and whom we must undersell materially in order to procure any share of the market. In conclusion, I would reiterate my statement that it is my firm belief that coal tar colors can be made here, and it rests wholly with your honorable body to make the industry prosper or die out by tariff legislation.

Respectfully, FREDERICK KOEHLER.

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REMARKS ON MR. WILLIAM PICKHARDT'S TESTIMONY GIVEN BEFORE THE SUBCOMMITTEE ON THE TARIFF OF THE SENATE COMMITTEE ON FINANCE, DECEMBER 5 AND 6, 1888

Mr. Pickhardt does not contradict our statement that he charged $1 per pound over the European price. We are informed by the defendants in the suit that the patent had two years longer to run when the adverse court decision came, and other alizarine importers stated that Mr. Pickhardt could have had the patent two years longer if he had permitted the defendants and one or two others to share in the profits.

Page 8, b, line 8 Anthracene was formerly made here and could be made here again.

Line 16 The coal tar produced here is practically the same as that produced in London.

Page 9, b, line 9 Considerable coal tar products are made in this country -and used for coal tar dyes and other purposes in spite of Mr. Pickhardt' s decisive "No."

Page 12, line 15 How can the woolen mills of Rhode Island be retarded when the duty on the whole importation of coal tar dyes used for cotton, wool, silk, paper, jute, lake colors, etc., only amounts to $400,000 per year? On all these articles the quantity of color used can not average 1 pound of dye to 100 pounds of material.

Page 13, line 8 - If Mr. Pickhardt calls the stuff the New York Coal Tar Company distills benzine, he tries to mislead. He must know this is commercial benzole 50 and 90 per cent used in the manufacture of coal tar products. In fact, these are the standard grades produced by coal tar distillers for the trade.

Line 13 On a previous page Mr. Pickhardt describes the process of distillation very minutely, and here he does not know what comes off first.

Page 14, line 17 - Mr. Pickhardt says that his factory was only making 10 per cent on their capital. For the last four years they declared dividends of from 12½ to 25 per cent after deducting large amounts for wear and tear, reserves, etc. His statement that an aniline factory would be useless for any other purpose is absolutely true. Mr. Pickhardt's statement that all azo dyes are made from naphthole and naphthalene and the aniline colors from aniline is incorrect and shows how very little he understands of the real nature of coal tar dyes. The very first azo color discovered amidoazo benzole is a pure aniline color and contains not a trace of naphthole or naphthalene. The true characteristic of an azo dye is the fact that it contains the azo group N-N.

Page 15, line 10 -  If the patent has nothing to do with the price it is singular that alizarine red should have dropped $1 per pound as soon as the patent was practically declared void, page 7.

Page 19, line 9 -  Mr. Pickhardt's assertion that transportation from London to New York is as low as from London to Germany is not correct. It costs three times as much to New York as to Cologne on the Rhine.

Page 21, line 20 -  It is singular that Mr. Pickhardt can not state the difference in price of soluble and insoluble alizarine blue, as he imports and sells both. We protest against putting the alizarine colors on the free list. These colors, with free alizarine red, can be produced here as well as any of the coal tar colors.

Page 5, c, last line -  The Buffalo people never tried to sell their factory to Mr. Pickhardt or anybody else. The reason why the industry did not develop is because the duty was lowered in 1883 but not because we can not get the proper help.

Page 7, c - The reasons for the decline in prices of aniline colors are, first, cheaper raw material; second, improved methods and principally on account of the enormously increased output. Farbwerke, Meister, L. and M. produced in 1863, 10 to 14 pounds of magenta per day; in 1873 they produced 770 pounds per day. 100

Mr. Pickhardt's reply to Mr. Randall's letter  -  In 1883 Heller & Merz's ultramarine factory was about the third largest in the world and probably furnished 10 per cent of the world's consumption. The labor in aniline factories in the United States ranges from $1.25 to $1.75 per day for ordinary laborers.

We estimate the production of aniline dyes in the United States at 500,000 pounds, and the value at $500,000.

Mr. Pickhardt's statement regarding the number of men employed in this industry is probably correct. In this connection we may say that the Buffalo factory employed over 100 men before the last reduction in duty. They now employ about one-half that number.

The production of aniline colors in Germany last year was in round numbers 13,000,000 pounds. Of this, oneninth is exported to the United States. Seven-eighths of the entire output is exported.

The following is a pretty complete list of coal tar dye factories in Europe: Germany, 18 factories; England, 6 factories; France, 6 factories; Switzerland, 6 factories.

It would be very desirable to have free alcohol, but for many purposes it should be free from admixtures such as methyl alcohol, camphor oil, etc.

Page - 14 There is a decided difference between dyewood and coal tar colors. The first named are products of agriculture, while the latter are wholly manufactured articles.

Page  - 18 Mr. Pickhardt says here that in 1872, when he contemplated starting an ultramarine factory, nobody else had thought of it up to that time. He seems to have forgotten that he bought ultramarine from Heller & Merz several years before the date mentioned.

Pages 19 and 20 -  Not everybody seemed to have been of Mr. Pickhardt's opinion regarding the foolishness of starting an aniline factory here. As late as 1882 the general manager of Mr. Pickhardt's factory told Dr. Koehler that he considered America a good field for that industry then and he would come over himself if he had been younger. He told Dr. Koehler he did not consider the Americans crazy enough to lower the duty. Another authority on this subject is G. Schultz, who, in his book on coal tar dyes, edition of 1882, says: "The tar in Russia and especially in America is developing. The latter country may soon be a serious competitor in this line to Europe."

Page 22 Mr. Pickhardt evidently wishes to convey the impression that our raw material is almost finished color. This is not the case by any means, as Mr. Pickhardt knows. With the exception of a few of the very largest, all the European factories buy their material in the same state as we do.

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SCHEDULE SHOWING THE PRINCIPAL RAW MATERIALS USED IN AMERICAN COAL-TAR DYE FACTORIES, AND THEIR PRICES HERE AND ABROAD

... | Price per pound in Europe  |  -"- United States
Sulfuric acid 66°  | $ 0.45  | $ 0.95
Nitric acid 40° |  4.75  | 5.50
Muriatic acid  20°  | 0.30 |  1.10
Aniline oil for blue |  16.33  | 18.00
Aniline oil for red |  15.00 |  16.50
Toluidine |  15.00 |  19.50
Nitrobenzole  | 14.70 |  18.00
Binitrotoluol  |  14.70  | 18.00
Bichromate of soda |  7.00 |  9.50
Salt  |  0.10 |  0.25
Naphthole |  14.40 |  18.00
Nitrite soda |  5.77 |  7.72
Alkali, 58 per cent |  1.10 |  1.40
Iron borings  | 0.50 |  0.75
Caustic soda, 74 per cent  | 1.74  | 2.84
Labor per week |  4.04  | 10.00
Total |  $115.88  | $148.01

The above list shows that we have to pay for our raw material and labor on an average 28 per cent more than it costs on the other side. If it is further considered that we are obliged to undersell imported dyes from 5 to 10 per cent, that our plant costs at least twice as much, the higher interest on capital and insurance, on plant and wear and tear of same, and the difference in scientific and clerical help, it will be plain to everybody that 35 per cent, even if fully collected, is an entirely inadequate protection. This assertion is borne out by the schedules given above, showing the different costs of a few of the principal colors in this country and abroad.

All of above calculations do not include salaries for chemists and office help, insurance on plant, interest on capital invested, etc., all of which items form a large part of the cost of the finished product, and cost at least twice as much here as they do in Europe.

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TARIFF HEARINGS BEFORE THE COMMITTEE ON WAYS AND MEANS, 1896-7
MONDAY, December 28, 1896.
PP. 57-61. Mr. SCHOELLKOPF submitted the following paper:

COMMITTEE ON WAYS AND MEANS, Washington, D. C.:

The undersigned coal tar dye manufacturers of the United States respectfully submit that the following changes be made in the present tariff law:

Paragraph 14, which reads as follows: "Coal tar colors or dyes, by whatever name known, and not specially provided for in this act, 25 per cent ad valorem," should be changed to read as follows:

"Coal tar colors and dyes of every description not specially exempted by name, 35 per cent ad valorem."

The change in phraseology increases the clearness of the paragraph, and the increase in duty to 35 per cent is absolutely necessary to put the industry on a footing which will enable it to compete successfully with the foreign makers.

Article 443: "Coal tar, crude, and all preparations except medicinal coal tar preparations and products of coal tar, not colors or dyes, not specially provided for in this act, free."

This article should be changed to read as follows:
"Coal tar and all products and preparations of coal tar, not colors or dyes, except medicinal coal tar preparations and such other coal tar products and preparations which are specially exempted by name, free."

This phraseology makes the paragraph much clearer without, in any way, changing its meaning, and will avoid differences of opinion as to where certain products belong.

Article 368, which reads as follows: "Alizarine, natural and artificial, and all alizarine colors and dyes, free," should be changed to read as follows: "Alizarine, natural and artificial, free."

This is the way the paragraph stood in the act of 1883, and there is no reason whatever why alizarine colors, which are nothing more nor less than coal tar colors, should be put on the free list any more than any other class of coal tar colors.

The tariff of 1890 left the domestic coal tar dye manufacturers in a very unfortunate position, with the duty of 35 per cent on the colors and 20 per cent on coal tar preparations, which constitute a large percentage of the raw material for the colors. This, in addition to the higher prices we are compelled to pay for labor and other domestic chemicals, precluded any real progress of the American manufacturers in their struggle against the aggressive competition of the well-equipped German factories. The Wilson bill placed the coal tar preparations on the free list, but by reducing the duty on the colors to 25 per cent did not improve the position of the domestic makers. We feel confident that the slight increase asked for, which makes the rate what it was under the tariff act of 1883 and 1890, will enable us, with the experience we have gained under adverse circumstances and with the great domestic progress in scientific chemistry, to successfully compete against the imported goods and in time supply the home market.

THE HELLER & MERZ Co., Henry Merz, Treasurer.
THE SCHOELLKOPF ANILINE AND CHEMICAL Co., By J. F. Schoellkopf, Jr.
HUDSON RIVER ANILINE COLOR WORKS, Louis S. Waldman, President.

THE CHAIRMAN. What is the extent of this industry of coal-tar colors in this country?

 Mr. SCHOELLKOPF. There are three plants with an aggregate capital of about a million dollars.

The CHAIRMAN. And how many employees?

Mr. SCHOELLKOPF. About 150 direct. Of course, the coal-tar dye industry is very large, in fact the largest consumer of crude chemicals, such as acids, etc., and in that way gives employment to a large number of hands indirectly. 105


The CHAIRMAN. About what proportion of the consumption of this country is produced here now?

Mr. SCHOELLKOPF. I would say about 20 to 25 per cent.

The CHAIRMAN. I see that the imports last year amounted to about $3,000,000.

Mr. SCHOELLKOPF. Well, I think that includes the alizarine red, also, as well.

The CHAIRMAN. It includes all dutiable coal-tar colors?

Mr. SCHOELLKOPF. Yes; I think that alizarine colors, which are coal-tar colors, of course, are included in that.

The CHAIRMAN. I presume so.

Mr. SCHOELLKOPF. I would like to mention that in this percentage I was not referring to alizarine red, which is on the free list now and always has been on the free list.

The CHAIRMAN. Are alizarine colors made in this country?

Mr. SCHOELLKOPF. They are not at present. They are on the free list at present and, of course, can not be made here. They could be made.

The CHAIRMAN. No attempt has been made to make them?

Mr. SCHOELLKOPF. They could be made.

The CHAIRMAN. Are there any special difficulties in the manufacture of these colors in this country?

Mr. SCHOELLKOPF. There are not now.

The CHAIRMAN. Growing out of the technical education which is required?

Mr. SCHOELLKOPF. That used to be the case formerly, but, of course, as I have stated in my paper, we have overcome these difficulties and are in a fair shape to capture the home market if we are sufficiently protected; and aside from the coal-tar products, which are on the free list, we consume vast quantities of other chemicals which are made in this country and can not be imported, such as acids, etc.

The CHAIRMAN. There is a great difference in the value of these materials?

Mr. SCHOELLKOPF. Yes, sir.

The CHAIRMAN. Therefore an ad valorem duty, perhaps, could be applied better than a specific duty could be applied?

Mr. SCHOELLKOPF. It would be rather difficult to apply a specific duty.

The CHAIRMAN. The prices ranging from what to what?

Mr. SCHOELLKOPF. Running from 20 to 25 cents a pound up to $15 a pound. Mr. McMiLLiN. What will be the value of the product which will be affected by the change of from 25 per cent ad valorem to 35 per cent?

Mr. SCHOELLKOPF. You mean the value at present of the products of this country? Mr. McMiLLiN. Yes, sir.

Mr. SCHOELLKOPF. I should say about $600,000 or $700,000. Mr. McMiLLiN. And the present duty being 25 per cent, 10 per cent added to that is an increase of more than 20 per cent of the present rate. That would be a difference of between $100,000 and $200,000 added to the value of that product?

Mr. SCHOELLKOPF. I doubt very much whether it would add that much to the direct cost at the present time. We are not really able to compete at all, and while we are selling our colors we are not making anything on them, and we can not possibly make anything on them, and it is not so much we ask an increased duty to increase our prices greatly but simply to be better able to compete. It is not so much we want to increase the prices one or two hundred thousand dollars, but if we can increase our production we can produce cheaper if we are sure of this market, but if we must compete against twenty-five or thirty importers in New York, each one of whom represents a large manufacturing establishment on the other side, we must compete on even their terms and we must expect to get our proportion of the business which will be about 5 or 10 per cent, because this is our only market, and we can not manufacture on a sufficiently large scale to produce cheaply.

Mr. McMiLLiN. How many hands does your concern employ?

Mr. SCHOELLKOPF. We employ at the present between 60 and 70 hands. Mr. McMiLLiN. And there are three concerns, representing the business of this country, I believe you stated, who employ about 150 hands?

Mr. SCHOELLKOPF. Some gentleman here can state that better than I can.

The CHAIRMAN. From what source of supply is crude tar product obtained the residuum of the manufacture of gas?

Mr. SCHOELLKOPF. Yes, sir.

The CHAIRMAN. It comes from no other source in commercial quantities. Is is a by-product of the manufacture of gas?

Mr. SCHOELLKOPF. Yes, sir.

The CHAIRMAN. Has the supply of coal tar of this country been diminished by the extensive manufacture of water gas instead of coal gas?

Mr. SCHOELLKOPF. It has.

The CHAIRMAN. Is the supply insufficient in this country?

Mr. SCHOELLKOPF. The raw materials we use are an intermediate product between coal tar and coal-tar colors. There are certain products of coal tar which are intermediate, and those are the products which we use. Mr. McMiLLiN. Is any considerable portion of this raw material imported?

Mr. SCHOELLKOPF. A very considerable proportion. Mr. McMiLLiN. But you get your raw material free?

Mr. SCHOELLKOPF. Yes, sir. Mr. McMiLLiN. You do not seek to add a duty to that? Mr. SCHOELLKOPF, No, sir; we do not. In fact, we could not.

The CHAIRMAN. The reason is there is an insufficient supply of the by-product?

Mr. SCHOELLKOPF. That is one reason. Of course, we could not get along without a duty on colors. We would have to have an additional duty on colors if we put an additional duty on the raw material.

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ANILINE COLORS AND DYESTUFFS

STATEMENT OF F. E. ATTEAUX & Co., OF BOSTON, MASS.
BOSTON, MASS., January 9, 1897.

COMMITTEE ON WAYS AND MEANS:
We beg leave to present in brief our reasons for requesting that a duty be placed upon all colors commercially known as alizarine colors, with the exception of true chemical alizarine. We are domestic manufacturers of so-called alizarine colors and dyestuffs, and have our works at South Boston, Mass. Our plant there is valued at about $75,000. We have been in this business a number of years, and are manufacturing a line of colors which come into competition with the so-called alizarine colors which are imported to this country. In the last ten years we have spent over $20,000 experimenting, and we are now able to make a considerable number of colors which do the work of the imported colors. We feel that we are entitled to consideration and that our interests ought to be considered by your committee in framing this bill.

BENEFITS THE DOMESTIC CONSUMER
In 1890, when we commenced to manufacture the color which we call alizarine violet, and which took the place of the foreign alizarine violet, the imported color was sold in this market at 75 cents a pound. Today it is being sold at 28 cents a pound, and the reduction has been largely due to our competition. We make in the same way alizarine green, so called, and this comes in competition with the imported veridine, or coeruline. The importers were selling this color at that time at about 48 cents a pound. Today, largely in consequence of our being able to manufacture a similarcolor, the price has fallen to 25 cents a pound. These are only two instances of cases which may be amplified to show your committee what has been the effect of our presence as manufacturers in this market. In addition to these two colors we are now manufacturing five other so-called alizarine colors, to wit, Blue B., Blue G. S., Blue R., Brown O., and Brown R. These colors come into competition with and take the place of imported alizarine blue and brown. The foreign colors are patented, as is well known, and the prices charged here and abroad for the same article have greatly varied, at the expense of the American consumer.

It is well known to the coal-tar color trade that prior to 1888 a certain firm of importers in this country was charging $1.25 per pound for alizarine which was sold all over Europe at 25 cents. As long as we are not able to produce these colors, the complete control of the market will enable the foreigner to charge a price without reference to the cost, and based entirely upon the needs of the consumer and his inability to obtain the color from any other source. In this connection, we beg leave to refer your committee to the statements made and testimony taken July 7, 1888, before the subcommittee on the tariff of the Senate Committee on Finance, and printed on page 268.

The fact that the imported colors are patented does not make it impossible for us, under equal conditions, to compete with these articles, as we have been able in the past and expect in the future to make colors which will do the work of the imported colors and not infringe upon their patent rights. If we can do this, it will be seen that it will be of large benefit to the domestic consumer, as the patent has been in the past the means of keeping up the prices artificially in this country. As soon as we have been able to make a color that did the work of a foreign color we have found that the importers have been compelled to bring their prices down and to sell at or below our price; and this price of ours being based upon the cost of manufacture has given the consumer the benefit of a large reduction in the artificially sustained price.

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DUTY ON RAW MATERIAL AND NOT ON THE MANUFACTURED ARTICLE

In our industry we are confronted with conditions imposed by the tariff which are a reversal of the usual methods of protection. We are paying 25 per cent duty on the articles which we import and use as the material for making our colors. We are compelled to sell the colors which we manufacture in competition with the so-called alizarine colors which are entered without duty by the importers. We use at present as our raw material imperial blue, chrome orange, and naphthol yellow, and on these we pay at the custom-house 25 per cent duty as coal-tar colors.

In addition to this, it may be stated that our labor costs at least double that of Europe, we paying $1.50 a day while the same class of labor can be had there at 75 cents a day. As we have heretofore stated, this is a direct reversal of the theory of protection of a new industry, and we feel that if we are compelled to pay a duty of 25 per cent for that which enters into our complete product, the article which is not manufactured and with which we are now competing should pay at least the same rate of duty * * *

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TARIFF HEARINGS BEFORE THE COMMITTEE ON WAYS AND MEANS, 1908-1909

WEDNESDAY, November 11, 1908.
VOL. i PP. 128-130. Mr. SCHOELLKOPF. I represent the Schoellkopf, Hartford, Hanna Company, of Buffalo, N. Y., and the Heller & Merz Company, of Newark, N. J. I have prepared a short brief, which I will read.
 (Reads:)

BUFFALO, N. Y., November 9, 1908.
 Hon. SERENO E. PAYNE, Chairman Ways and Means Committee.

DEAR SIR: The undersigned respectfully request that at the impending revision of the tariff the minimum duty on coal-tar colors and dyes be increased from 30 per cent to 40 per cent ad valorem, and that all coal-tar products and preparations not colors or dyes used in the manufacture of these dyes be placed on the free list.

In submitting this request we do so with the understanding that it is the intention of Congress so to adjust import duties as to give the domestic manufacturer adequate protection against his foreign rival; or, in other words, the duties imposed shall cover the difference in cost of the article protected when made in America as against the same article when made abroad.

In asking for free entry of all coal-tar products and preparations used in the manufacture of coal-tar colors, no American industry will be injured, as these articles are not made in the United States, nor can they be manufactured profitably under existing conditions.

In order to prove that our demands, as outlined above, are not unreasonable we have prepared the following tables:
Table A - Showing cost of coal-tar dye plant in America and Germany, designed for a yearly output of 3,000,000 pounds; also showing the cost for depreciation on buildings and wear and tear on machinery and interest on investment.

Table B -  Showing number of employees required and their salaries for such a plant in America and Germany.

Table C  -  Showing material required to produce 3,000,000 pounds of color and cost of same under present tariff; also under tariff as proposed by us; also cost of same material in Germany.

Table D -  Showing comparative cost of 3,000,000 pounds of color when produced in Germany; also cost when produced under present tariff; also cost when produced under tariff as proposed by us.

By referring to Table D it appears that taking the cost of colors in Germany at 100 per cent, the same colors cost to produce in America under the present tariff 144.1 per cent, and in case all coal-tar preparations should be admitted free, the cost would still be over 134.4 per cent. That our figures are correct is positively proven by two highly significant facts.

First. These same colors are now being imported from Germany and sold in this market for less than it costs us to produce them, even omitting charges for depreciation and interest on investment.

Second. By the fact that German manufacturers do not manufacture in the United States because, as people high in authority state openly, they can manufacture the colors in Germany and lay them down in the United States, with duty of 30 per cent and manufacturer's profit added, at a lower price than they could manufacture the same colors in America.

By referring again to the same table it appears that under the proposed tariff the cost of colors would be only 35 per cent higher than the same colors when made in Germany, while we are asking for a duty of 40 per cent. It should be borne in mind, however, that in the first place the American manufacturer, in order to secure the home market, must be in a position to under-sell the importer, and in the second place, the foreign manufacturer, when driven to it, will always assume part of the duty himself. The result would be that with a duty of 40 per cent the American manufacturer could not hope to realize more than 30 per cent in excess of what the same goods are sold for in Germany, and probably considerably less. In any event, therefore, even with a 40 per cent duty, the American manufacturer would have to content himself with a considerably smaller profit than his German rival.

Since the present tariff went into effect American coaltar dye manufacturers have striven strenuously to capture the home market, and while they have succeeded in increasing very materially their output, they have done so at no profit to themselves. Whenever the domestic production of any one color increased sufficiently to interfere seriously with the sale of the imported product, the foreign manufacturers dropped prices to a point that compelled the American manufacturer to sell at cost or even lower.

On the other hand, colors not made in America and controlled by the foreign manufacturers, either through patents or combinations, were not only not reduced, but in many instances actually increased in price. Eliminate American competition, and prices, even with a reduced duty, will rise and not fall. We refer to such products as alizarines, aniline salt, aniline oil, beta napthol, etc., which during the past few years have been advanced from 15 to 20 per cent, although the cost of production has not risen.

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TABLE A SHOWING COST OF COAL-TAR DYE PLANT DESIGNED FOR A YEARLY OUTPUT OF 3,000,000 POUNDS; ALSO SHOWING THE COST OF DEPRECIATION OF BUILDINGS AND WEAR AND TEAR ON MACHINERY, ETC.

Cost of plant in | U. S. | Germany
For land  | $50,000  | $50,000
For buildings  | 100,000 | 60,000
For machinery, tools, etc.  |  380,000 | 250,000
For working capital  |   500,000 | 350,000
 Total cost of plant  | 1,030,000  | 710,000

Depreciation on buildings, 5 per cent | 5,000 | 3,000
Wear and tear on machinery, etc., 10 per cent  | 38,000  | 25,000
10 per cent Interest on investment, 6 per cent  | 61,800 | 42,600
... | 104,800  | 70,600

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TABLE B EMPLOYEES NEEDED FOR A COAL-TAR DYE PLANT WITH A YEARLY CAPACITY OF 3,000,000 LBS.

...  | United  States Rate | United States Amount | Germany Rate | Germany Amount
1 general manager  | $10,000 | $10,000 | $5,000  | $5,000
2 head chemists | 5,000 | 10,000 | 2,500 | 5,000
4 chemists | 1,500 | 6,000 | 1,000 | 4,000
1 chemist | 1,300 | 1,300 | 800 | 800
1 chemist  | 900 | 900 | 600 | 600
3 dyers  | 1,144 | 3,432 | 390 | 1,170
1 helper  | 468 | 468 | 160 | 160
1 helper | 213 | 312 | 135 | 135
2 boys  | 208 | 416 | 78 | 156
1 head bookkeeper  | 2,500 | 2,500 | 1,200 | 1,200
1 clerk  | 1,800 | 1,800 | 900 | 900
1 clerk  | 1,200 | 1,200 | 600 | 600
3 clerks  | 900 | 2,700 | 450 | 1,350
1 clerk  | 780 | 780 | 350 | 350
2 boys  | 500 | 1,000 | 250 | 500
1 telephone operator | 364 | 364 | 160 | 160
1 superintendent  | 1,560 | 1,560 | 750 | 750
1 shipping clerk  | 1,200 | 1,200 | 450 | 450
2 engineers  | 1,040 | 2,080 | 520 | 1,040
6 firemen  | 780 | 4,680 | 390 | 2,340
2 watchmen  | 728 | 1,456 | 390 | 780
2 teamsters  | 624 | 1,248 | 390 | 780
4 carpenters  | 780 | 3,120 | 390 | 1,500
2 machinists  | 936 | 1,872 | 468 | 936
2 blacksmiths  | 676 | 1,352 | 468 | 936
4 helpers  | 624 | 2,496 | 260 | 1,040
10 foremen  | 718 | 7,180 | 390 | 3,900
83 laborers  | 540 | 44,820 | 300 | 24,900
TOTAL  | 116,236  | -  | 61,493  | -


TABLE C MATERIAL REQUIRED FOR 3,000,000 LBS. OF COAL-TAR DYES AND COST OF SAME
Chemicals Used  | Quantities in lbs.  | Cost in US under Present tariff  | Cost in US under Proposed tariff  | Cost in Germany
Nitrate soda  | 385,803  | $29,899.74  | 29,899.74  | $23,919.79
Muriatic acid  | 1,369,125  | 10,268.43  | 10,268.43  | 8,214.74
Sulfuric acid  | 122,814  | 409.38  | 409.38  | 327.50
Carbonate soda  | 790,875  | 7,592.40  | 7,592.40  | 6,073.92
Caustic soda  | 111,942  | 2,417.94  | 2,417.94  | 1,934.35
Common salt  | 3,371,280  | 5,899.74  | 5,899.74  | 4,719.79
Sulfide sodium  | 4,800  | 65.61  | 65.61  | 52.49
Ammonia 26°  | 2,880  | 144.00  | 144.00  | 115.20
Monothyl alpha naphthylamine  | 4,437  | 1,668.30  | 1,387.89  | ,110.31
Aniline oil  | 139,041  | 16,128.75  | 16,128.75  | 12,903.00
Paranitroaniline  | 68,445  | 16,426.80  | 13,680.00  | 10,951.20
H-acid  | 593,145  | 206,414.46  | 172,605.21  | 138,084.17
Alpha naphthylamine  | 54,270  | 4,205.94  | 4,205.94  | 3,364.75
R-salt  | 29,295  | 4,247.79  | 3,544.71  | 2,835.77
Amido-G salt  | 35,910  | 9,605.91  | 7,989.96  | 6,391.96
Freund's acid  | 9,630  | 1,661.16  | 1,396.35  | 1,117.08
Cleve acid  | 4,032  | 695.52  | 584.64  | 467.71
Gamma acid  | 12,420  | 5,464.80  | 4,558.14  | 3,646.51
Salicylic acid  | 18,720  | 4,867.20  | 2,822.97  | 2,258.38
A B Sp Sa  | 47,952  | 5,591.19  | 5,072.22  | 4,057.78
A A Tm Ba  | 19,908  | 4,411.62  | 4,081.14  | 3,264.91
A A Bm Ba  | 104,625  | 22,965.18  | 21,228.09  | 16,982.47
A A Tm S  | 23,400  | 7,317.18  | 5,974.02  | 4,779.22
Tolidine  | 25,740  | 8,494.20  | 8,494.20  | 6,795.36
Benzidine  |  218,340  | 66,047.85  | 66,047.85  | 52,838.28



TOTAL 7,568,889 442,911.09 396,508.32 317,206.64 TABLE D COST OF PRODUCING 3,000,000 LBS. OF COAL-TAR DYES


Materials, labor, fuel, etc.  | When made in United States under present tariff | When made in United States under proposed tariff  | When made in Germany
Materials  |  $442,911.09  | $396,508.32 | $317,206.6
Fuel  | 20,250.00 |  20,250.00  | 4 27,000.00
Labor  |  116,236.00 |  116,236.00 |  61,493.00
Interest on investment  | 61,800.00  |  61,800.00  |  42,600.00
Depreciation of plant  |  43,000.00  |  43,000.00 |  28,000.00
Taxes, fire insurance, and incidentals  | 8,000.00 | 8,000.00 |  4,000.00
... |  692,197.09 | 645,784.32  | 480,299.64
Per cent.  |  144.1  |  134.4  |  100



TABLE E

PRESENT WORDING
Sec. 15 Coal-tar dyes or colors, not specially provided for in this act, 30 per cent ad valorem; all other products or preparations of coal tar, not colors or dyes and not medicinal, not specially provided for in this act, 20 per cent ad valorem

Sec. 469 - Alizarin, natural or artificial, and dyes derived from alizarin or from anthracin.

Sec. 524 Coal tar, crude, pitch of coal tar, and products of coal tar  known as dead or creosote oil, benzol, toluol, naphthalin, xylol, phenol, ere sol, xylidin, toluidine, cumidin, binitrotoluol, binitrobenzol, bendidin, tolidin, dianisidine, naphthol, naphthlyamin, diphenylamin, benzaldehyde, benzyl chloride, resorcin, nitrobenzol, and nitrotoluol; all the foregoing not medicinal and not colors or dyes.

Sec. 580 Indigo.

NEW WORDING SUGGESTED
Coal-tar dyes or colors, not specially provided for in this act, 40 per cent ad valorem.

No change suggested

Coal tar, crude, and all products or preparations of coal tar, not colors or dyes and not medicinal, not specially provided for in this act.

No change suggested.

In conclusion, we beg to state that the figures and tables contained in this document are taken from our books, and represent actual conditions, and if desired we are prepared to prove the correctness of same in every particular.

On a separate sheet annexed hereto, marked Table E, we suggest the wording of the sections in the tariff which we desire to have changed.

Respectfully submitted,
SCHOELLKOPF, HARTFORD & HANNA COMPANY,
THE HELLER & MERZ COMPANY.
p. 143. NEW YORK, November 20, 1908.
Hon. SERENO E. PAYNE,
Chairman Committee on Ways and Means,
House of Representatives.

At a meeting of the firms interested in and dealing in "coal-tar colors or dyes" and "coal-tar products not colors or dyes, not otherwise specially provided for," held here to-day, the following resolution was unanimously adopted:

Resolved, That we, the undersigned, protest against any increase in the duties on coal-tar colors or dyes, by whatever name known, or coal-tar products not colors or dyes, not otherwise specially provided for, and request an opportunity to be heard individually at such time and place as is convenient to the committee of Congress.
H. A. METZ & Co., H. A. Metz, President.
CASSELLA COLOR COMPANY, G. W. J. Matheson.
BADISCHE COMPANY, Adolf Kuttroff, President.
FARBENFABRIKEN OF ELBERFELD COMPANY, Y. Rellmerling, President.
A. KLIPSTEIN & Co., G. O. Klipstein, Treasurer.
BERLIN ANILINE WORKS, E. O. Patz, Second V ice-President.
GEIGY ANILINE AND EXTRACT COMPANY, Alfred Kiiblein, Vice-President.
WALTER F. SYKES & Co., Jno. A. McGuire, Attorney.
GEISENHEIMER & Co.
C. BISCHOFF & Co.
KALLE & Co. (incorporated), Wm. Junker, Secretary. p. 146.

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MEMORIAL AND PROTEST IN OPPOSITION TO ANY ADVANCE IN DUTIES ON COAL-TAR COLORS AND DYES

WASHINGTON, D. C, December 20, 1908.
COMMITTEE ON WAYS AND MEANS,
Washington, D. C.

GENTLEMEN: Your memorialists, cotton manufacturers, consumers of coal-tar dyes for the coloring of various cotton fabrics (the largest consuming industry of coal-tar dyes in the country) respectfully submit:

First. We desire to protest against any advance in the rates of duty on coal-tar dyes or colors under Section 15 of the present tariff on the ground that such advance would

(a) Increase the cost of manufacturing colored cotton goods in the United States.

(b) Increase the price to the consumer in the United States.

(c) In the case of export trade an advance in the cost of any of our raw materials adds to our burden and minimizes our opportunity to compete with foreign cotton manufacturers in foreign markets.

Second. We further petition that, for the same reasons, alizarines and dyes derived from alizarin and anthracene, as well as indigo, be left upon the free list, and that no change be made in the following schedules now on the free list:

Section 468. Alizarin, natural or artificial, and dyes derived from alizarine or from anthracene.

Section 580. Indigo (meaning vegetable and synthetic).

Very respectfully,
AMOSKEAG MFG. Co., F. C. Dumaine, Treasurer, Manchester,
N. H. HAMILTON MFG. Co., Franklin D. William, Assistant Treasurer, Lowell, Mass.
PACIFIC MILLS, Edwin F. Greene, Treasurer, Lawrence, Mass.
MASSACHUSETTS COTTON MILLS, Edward Lovering, Treasurer, Lowell, Mass.
MERRIMACK MFG. Co., Herbert Lyman, Treasurer, Lowell, Mass.
COCHECO MFG. Co., H. DeF. Lockwood, Treasurer, Dover, N. H.
AMERICAN PRINTING Co., B. H. Borden, Treasurer, Fall River, Mass.
THE UNITED STATES FINISHING Co., J. H. Wright, President, New York.
 THE APPONAUG Co., J. H. Wright, President, Apponaug, R. I.
 GARNER & Co., Oscar Hutley, Vice-President, Pleasant Valley, N. Y.
 PASSAIC PRINT WORKS, Edward E. Poor, Treasurer, Passaic, N. J.
ARNOLD PRINT WORKS, W. A. Gallup, Treasurer, North Adams, Mass.
WINDSOR PRINT WORKS, D. A. Russell, General Manager, North Adams, Mass.
RENFREW MFG. Co., Ira S. Ball, Assistant Treasurer, Adams, Mass.
QUEEN DYEING Co., B. J. Horton, Treasurer, Providence, R. I. S. H.
GREENE & SONS CORPORATION, Francis W. Greene, Treasurer, Riverpoint, R. I.
 THE ASPINOOK Co., L. Johnson, Treasurer, Jewett City, Conn. 118

The hearings of 1913 both before the Committee on Ways and Means and the Senate Finance Committee were of the same general tenor as the statements just given.

The duties on coal-tar dyes in the different tariff revisions were:
1864 Anilin dyes, $1.00 per Ib. and 35 per cent.
 1870 Anilin dyes, 50c. per Ib. and 35 per cent.
 1883 Anilin dyes, 35 per cent.
 Alizarin, free.
 Anilin oil and saults, free.
 Indigo, free.
 1890 Same as 1883, with alizarin dyes added to Free List.
 1894 Coal-tar dyes, 25 per cent.
  Alizarin dyes and indigo, free.
  Anilin oil and salt, free.
 1897 Coal-tar dyes, 30 per cent.
 Alizarin dyes and indigo, free.
 Anilin oil and salt, free.
 1909 Same as 1897.
 1913 Alizarin and alizarin dyes, free.
 Indigo and indigo dyes, free.
 Anilin oil and salts, toluidin, xylidin, etc., 10 per cent.
  Coal-tar dyes, 30 per cent.
   Carbazol dyes, free.

 It is therefore clear, in the light of the above tariffenactments, that the preceding arguments of dye-users against suitable tariff-enactments on coal-tar dyes so as to enable their manufacture in this country, were more persuasive with Congress than the arguments of domestic dye and chemical makers on behalf of such favorable tariff enactments.

 Will the awakening of the American public since August, 1914, alter this situation?