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Foreign trade is vital to the expanding economy of the Chicago area and all of Mid-America. Although it is not possible to determine the exact extent of the total exports of this area under methods used to compile foreign trade statistics, various studies give some indication of its volume. According to the 1954 Census of Manufactures, the Chicago metropolitan area ranked first among metropolitan areas in the production of primary metals, fabricated metals, and nonelectrical machinery; second in foods, electrical machinery, chemicals, printing and publishing, furniture and fixtures, and paper.
The Department of Commerce, conducting an exhaustive research into the impact of foreign trade on various geographical areas of the United States, reports that in Cook County, 1 of the 0 counties in the Chicago metropolitan area, about 461,000 workers participate in the benefit of such trade. About CO percent of all those employed in manufacturing in Cook County are in firms falling into 5 major manufacturing classifications: fabricated metal products, nonelectrical machinery, printing and publishing, food and kindred products, and electrical machinery. The county's proportionate share in United States exports of these 5 groups amounted to over $400 million in 1956. Cook County establishments in these industry groups engage directly in foreign trade, but this is only part of the picture. Many of the county's products are exported as component parts.
According to the 1954 Census of Manufactures, there are over 1,000 establishments in Cook County engaged in producing food and kindred products, employing about 95,000 people. Food and kindred products accounted for more than $1 billion worth of exports nationally in 1956. Cook County's share of these exports is estimated at .$60 million.
Approximately 112,000 persons were employed by 581 Cook County firms in the production of electrical machinery at the time of the Commerce Department survey. In 1956 total United States exports of electrical machinery exceeded $921 million. Computed on a per employee basis, Cook County's proportionate share of these exports is an impressive $102.8 million. The county was responsible for more than one-tenth of the exports of electrical machinery in 1956, on a proportionate share basis.
The Commerce Department survey also shows that 1,571 firms in Cook County producing nonelectrical machinery employ a total of more than 106,000 persons. In 1956 the national total for exports of nonelectrical machinery was nearly $3 billion. Cook County's share, computed on a proportionate basis, is better than $194 million.
In printing and publishing, better than 75,000 persons are employed in Cook County. Nationally, the United States exports printed and published materials valued at close to $100 million. In this field the most important consideration is not export, but import. These industries in Cook County have a large stake in foreign commerce because approximately 80 percent of the newsprint consumed in the United States is imported. These printing and publishing houses are also using inks manufactured with imported dyes and type facings made of imported alloys.
In fabricated metal products there were in 1956, 1,751 firms in Cook County employing about 83,000 persons. The national total for exports of fabricated metal products that year was $443 million. Computed on a per employee basis, this would give Cook County a proportionate share of exports in this classification of nearly $34 million. It is estimated that there are in the Chicago metropolitan area more than 2,000 firms engaged in exporting, including close to 200 export sales organizations, which handle the foreign sales of manufacturers not having their own export divisions.
The Middle West is the source of an estimated 40 percent or more of United States exports, agricultural and manufactured. In an exhaustive export survey which the association is now completing, we mailed approximately 6,000 questionnaires to firms in the States of Illinois, Indiana, Iowa, Nebraska, and Kansas, and parts of Minnesota, Wisconsin, Michigan, Kentucky, Tennessee, Arkansas, Colorado, South Dakota, and Wyoming, believed to be actively engaged or interested in export activity. The geographical area covered in this survey is shown on the questionnaire which is submitted as part of this statement.
Up to the present time, 557 firms have completed or partially filled in and returned the questionnaire. On the basis of such returns, it would appear that 4,500 to 5,000 companies in the area shown are actively engaged in exporting. Of the 557 firms that furnished information,. 521 reported exports in 1956 of 2,967,223 tons, of which 1,766,116 tons were manufactured goods and 1,201,107 tons, agricultural products, coal, minerals, cotton, etc.
Dollar value totaling $873,255,000 was reported by 429 of the 557 firms, all 557 companies had reported both tonnage and dollar value figures, it i.s i servatively estimated that the total tonnage and dollar value of the 1 exports of these firms would be 3,172,226 tons and $1,133,800,000.
A recent survey completed by the United States-Japan Trade Council ports that the 5 States of Illinois, Indiana, Ohio, Michigan, and Wiscoi accounted for $309 million of sales to Japan in 1957. This surpassed all oi regions of the United States.
The growth of import activity in the Chicago metropolitan area in re< years is reflected by the increase in the number of importers, import a?» and brokers in the area. The records of our World Trade Division diw that in 1950 there were 483 such firms and individuals: in 1954, 823; currently more than 1,200. These include manufacturers that import raw terials and comjwnent parts used in the fabrication of their products, wb salers which distribute throughout the area, and retailers such as onr mi department stores, which sell through their own outlets.
Forecasts by responsible governmental and private institutions as to th? lime of waterborne commerce, foreign and domestic, expected to move by St. Lawrence seaway when the project and connecting channels are compli range from 37 to 46 million tons. In metropolitan Chicago, two additir waterway projects—port development in the Lake Calumet area by the < cago Regional Port District, and at the mouth of the Chicago River by city, and the widening of the Sag Channel connecting Lake Calumet with Chicago Sanitary and Ship Canal and the Illinois River—are underway. W In 1 year after completion of the various projects, scheduled for 1962. i estimated that overseas cargo of all types moving through the port of Chit should increase to at least 1,500,000 tons.
We have estimated that within 15 years after the completion of the tl projects mentioned, new investment in industrial-plant facilities will reach billion. Within this same period It is anticipated these new industries will i vide Jobs directly and Indirectly for several hundred thousand workers, inc ing 40000 jobs directly connected with water transportation. The estim therefore, of 1.5 million tons within 5 years after the seaway Is complete believed to be conservative.
All of the present facts and future projections make it clear that the alre Important international commerce of Chicago and the Middle West requires continuance and extension of a foreign economic policy that will result In maintenance and expansion of world trade. The United States consista exports more than It imports. If we are to continue to have an export h ness that provides jobs for millions of United States workers without m» writing Indefinitely, through foreign aid, the difference between our fon sales and our Imports; if we want to bring back to this country, in doll the earnings on investment abroad; we must make it possible for other nati to market in this country raw materials and finished products which we i and want.
Preceding witnesses have presented In detail testimony that renewal of Reciprocal Trade Agreements Act in an effective manner is essential tn, national economic and political interests, that the jobs provided by our e\pt and imports of needed commodities, far outnumber those adversely affect^ the importation of a comparatively small amount of competitive foreign a«
The reciprocal trade agreements program is a basic cornerstone of oar eign economic policy. The Chicago Association of Commerce and Indrw therefore, strongly urges that the act be extended in an effective form. H 12591, providing for a period of 5 years and negotiated, reciprocal duty M tions but with provisions for defense essentiality protection and relief fl undue import competition, should be passed without amendment. This, w lieve, is in the best Interest of not only our members and area but of Uie « United States.
Senator Frear. Mr. Bernard Weitzer, Jewish War Veterans o United States of America.
STATEMENT OF BERNARD WEITZER, NATIONAL LEGISLATIVE DIRECTOR, JEWISH WAR VETERANS OF THE UNITED STATES OF AMERICA
Mr. Weitzer. I have a brief statement here, and I think I can save the committee's time by reading it rapidly rather than to try to comment on it.
Senator Freak. All right, sir.
Mr. Weitzer. As you see from the text of the statement, we are strongly in favor of the passage of the bill you are considering here before your committee.
On behalf of the Jewish War Veterans of the United States of Ajnerica, I am happy, once again, to express appreciation for the opportunity to present to your important committee our views on the Trade Agreements Extension Act which you are now considering.
This time, as on previous occasions, I appear before this committee by the authority of the strongly worded resolution passed by our national convention. The following resolution was passed at our 62d annual national convention:
Whereas, the Reciprocal Trade Agreements Act comes before the Congress for renewal in the 2d session of the 85th Congress; and
Whereas in its functioning through the General Agreement on Tariffs and Trade, this act has proved notably successful in promoting American exports and our foreign trade as a whole and minimizing the frictions and restrictions •which occasionally develop in the course of trade; and
Whereas we have long recognized that the exchange of imports and exports with our friendly world neighbors is an important factor in our own economic and political well-being as well as theirs and moreover contributes to our joint national security, and
Whereas we have regularly supported the reenactment of the Trade Agreements Act as a practical means of facilitating imports which produce the dollar exchange to pay for American exports to these foreign countries, and
Whereas the proposed Organization for Trade Cooperation will make even more productive, the objectives of the reciprocal trade agreements program and the General Agreement on Tariffs and Trade: Now, therefore, be it
Resolved, That the Jewish War Veterans of the United States of America In 62d Annual National Convention assembled at Boston, Mass., August 12-18, 1957, do commend the administration for the manner in which it has conducted the operations of the Reciprocal Trade Agreements Act of 1955 and the negotiations conducted under the General Agreement on Tariffs and Trade, and be it further
Resolved, That we urge the 85th Congress to authorize a renewal of the Trade Agreements Act for a period of not less than 3 years, to include in the legislation authorization for the Organization for Trade Cooperation and to refrain from tariff legislation which interferes with the functioning of the Reciprocal Trade Agreements Act.
The membership of our organization made up of men and women who have served in our Nation's Armed Forces, principally, as citizensoldiers, sailors, and airmen, having largely returned to their civilian pursuits, continue their keen interest in our national security.
They recognize the importance of maintaining our own military strength and that of our allies in deterring war against us by a strong, shrewd, potential enemy—Soviet Russia and its Communist satellites. Our membership is equally aware that the military deterrent must. be matched in strength by a sound productive economy in our own land and in all those lands which have not been sucked into the Communist orbit.
To maintain that strong productive economy and to complete i national security, the continuation of the reciprocal trade agreeme program is more imperative, today, than ever.
The activities of the states in the Soviet bloc, under Kremlin lei ership, in pushing for expansion of their foreign trade and th economic penetration in the free world, evidence their determinat to compete in that area. Failure to continue our foreign trade poli< as exemplified in the reciprocal trade agreements program wot serve admirably to advance the Communists' trade objectives and undermine our own strength.
As one looks over the figures of our export and import trade di ing the years 1950 through 1957, the flow of products oack and foi is powerful evidence of the profitable returns to ourselves and to nations with whom we have traded. During 1957, our expo mounted to a rate of more than $21 billion, and our imports were the neighborhood of $13 billion.
Roughly, for every $2 of import, there were $3 of exports. F»i their natural resources and other materials plus productive pom of their working people, these foreign lands fashioned the produ which they shipped to us and thereby obtained the dollar exchat which went far to permit them to pay for American products wh| required the work of approximately 4V£ million American citizens
We, in our country, secured goods which in many cases are vital our industry and to our national defense, and which are lacking extremely scarce in our own country. Other items in our impo enabled our people to enjoy some extra satisfaction in their daily livs and to secure more economically what they wanted.
Our own exports provided in other lands, even more important needed goods and materials which are essential to daily life and wh stimulated their industries. Thus our own Nation and all the tions with whom we traded as a consequence of our reciprocal tr agreements program enjoyed the benefits of the type of partner?, from which all benefited and which strengthened all.
This has been particularly important to many of the newly in pendent nations striving for a sound economy in order that their cial and political systems may be stable, and that the pressure? o low per capita income will not make their people easy targets- i Communist propaganda. This factor is weighty, as well, even in 4 industrialized nations of Europe.
The continuing momentous forces promoting our full national i curity, and our world security, generated by the Reciprocal Tra Agreements Act must be maintained. It cannot be expected that this effort for strength, we will not find in the wide expanse of <i industries, occasional small pockets of weakness which are expoS in world trade competition just as the f ree competitive system in d own country has exposed them throughout history during our * vances in technology, in development of new products, and in t changing desires of the consuming public.
The Reciprocal Trade Agreements Act of 1955 broadened the t cape clause procedure to take care of these weaknesses. Yet I ^ you to consider the record of what has happened for, as report by the 9th edition of the United States Tariff Commission, Invert gations Under the Escape Clause of Trade Agreements, reports of February 1958, 86 applications for escape clause action were filii "with the Commission ever since such investigations were provided, as compared with the 59 applications which I discussed with you in January 1955.
Thus, the average number of applications per year during the last 3 years has scarcely changed from those filed in previous years. Some of these investigations have been applied for time and again, and in the past 3 years the Tariff Commission has recommended escape clause action somewhat more frequently than previously, and the President has invoked the escape clause 4 times in the last 3 years as against 5 times in the 6 years prior to 1955.
It is apparent from these figures that provable harm has been done to very few industries under the reciprocal trade agreements program.
H. R. 9505 has been introduced to provide for aid to workers, industrial enterprises, and communities who are injured or threatened with serious injury as the result of imports into the United States. I am confident that your committee, if such a bill is within your province, can work out adequate legislation to take care of real injury.
This would be far better, where necessary, than to sacrifice our national security to the clamor which has been evolved from these very few and relatively insignificant situations. You should not permit such situations to swerve you from continuing the demonstrated benefits which the reciprocal trade agreements program has produced. TVe should not surrender the world, piece by piece, to economic aggression or subversion to any greater degree than we would yield supinely to Soviet military aggression.
In the first case, the stakes would be dollars alone; but in the second, it would be millions of precious lives as well as many, many times more dollars.
I just want to interject here. During wartime, men are called up for service in the armed services and, as you know, millions of men have suffered death and injury in the defense of our country.
We did not hesitate to do that because the national security of the country was involved, and I think the national security of our country is involved today just as much in this trade fight as it ever has been in wartime.
And what the veterans who lost their lives and suffered injury underwent for the security of their country, I think is not too much for some of these industries which may not be able to meet the situation but which, as I have indicated can be provided for through legislation; that ought not to be counted as an obstacle to the continuation of the reciprocal trade agreements program.
There is, presently, a further reason for the passage of H. R. 12591 as a minimum in the extension of the reciprocal trade agreements program as it lias been functioning. Our foreign trade should not be hampered in any way at a time when there are recessionary forces at work in our economy. Not only would such a curtailment damage our own economy, but it would signal to the world that we were obsessed by fear, and fear is frightfully contagious.
Extension of the reciprocal trade agreements program for 5 years would be a signal of courage and a proof of our conviction that as a world leader, our Nation is determined to march ahead.
Your approval of H. R. 12591 will strengthen our national security in the broadest terms, in our domestic well-being, in a productive
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