The CHAIRMAN. In justice to the Secretary of Agriculture, would it not be fair to him to say that he rather advocated destruction, continuing small, inefficient industries, but he opposed their expansion.

Mr. TREADWAY. Well, possibly I misconstrued a little of what he meant, but in the first place I do not admit the existence of those inefficient small industries. I think they are very efficient, to start with. There I would not agree with the Secretary. And there are other features.

Mr. FARRELL. You could apply the same principle to sick people, why you should put them out of misery without having resort to a hospital or anything else. Sixty percent of the business of this country is done by small manufacturers.

Mr. TREADWAY. And most of them-not most, but a great many of them—are located up in a country that you and I are familiar with?

Mr. FARRELL. Very much so.

Mr. TREADWAY. So that I think you and I are a little nearer in harmony than we are with the Secretary of Agriculture along that line.

Mr. FARRELL. I notice that the Secretary of Agriculture is not in favor of reducing the duty on wheat.

Mr. TREADWAY. I think that is very well put.

Mr. COOPER. What was it he said?

Mr. TREADWAY. Therefore, I think from your first recommendation you still think that we ought to have a duty sufficient to protect American industry and agriculture from destructive foreign competition?

Mr. FARRELL. Exactly.

Mr. TREADWAY. I agree with you fully on that. I do not think that appears in this bill.

Now let us pass on to no. 2, that the flexibility provisions of the tariff act be maintained, embodying a basic controlling formula laid down by Congress, according to which shall be determined the adequate protective level at which individual tariff rates shall be set. You recommend that such an item as that be included in this bill if reported out of this committee with your favorable endorsement, and you do not propose to endorse this bill as written here, and which is now before us, without accepting the recommendations that you are making?

Mr. FARRELL. I draft bills myself.

Mr. HILL. Therefore you think they should be incorporated in the bill. If they are not incorporated in the bill, what would be your opinion of the bill?

Mr. FARRELL. Well, you will have to take-it might be a case of the devil taking the hindmost.

Mr. TREADWAY. We would be the hindmost.

The third item here has to do with the setting up of a tariff adjustment board. I infer from what you have previously said that your organization favored such an adjunct to the Tariff Commission before this bill was brought forward?

Mr. FARRELL. Yes, sir.

Mr. TREADWAY. So that is not a new proposition of yours?
Mr. FARRELL. No, sir; it is not new.

Mr. HILL. And you are offering that, not so much as a comment on this bill as these other first two items. The first two items directly apply to the bill itself.

Mr. FARRELL. They are all necessary, in my opinion.

Mr. TREADWAY. In order to get the thorough support, unanimous support, of the United States Chamber of Commerce, you feel that those three distinct items should be included in any measure reported out of the committee. Therefore am I not right, Mr. Farrell, in reaching the conclusion that, as written, you and your organization do not approve of this bill?

Mr. FARRELL. I would not go so far as that.
Mr. TREADWAY. Not quite that far?

Mr. FARRELL. I would not go as far as that, because the Chamber of Commerce of the United States is made up of a large number of people. There are 1,600 organizations. Some of those organizations have several thousand members. Their total membership is about 600,000, and if it is possible to get a unanimity of opinion among that great number of people, I would not attempt to speak for them. I would rather have presented this report speaking for myself, but I was delegated to cooperate in the preparation of the report and present it, and I have done that to the best of my ability.

Mr. TREADWAY. I think your statement about the 1,500 organizations is well illustrated by these 25 men sitting right here. You cannot get the 25 of us to agree on a good many provisions that are brought before us, and therefore you have got a very much more difficult task, undoubtedly, to get those people to agree. But, nevertheless, by and large, I do not think that your statement here warrants the inference that you are endorsing the bill that we now have before us. Am I correct in that inference?

Mr. FARRELL. Well, partly.

Mr. VINSON. I cannot hear the witness.

Mr. FARRELL. I say partly.

Mr. TREADWAY. Now, let us analyze that a little bit. You are still a believer in the protective principles now in the law?

Mr. FARRELL. Reasonable protection.

Mr. TREADWAY. And one other idea: You are a believer in the retention of the flexible provisions?

Mr. FARRELL. Absolutely. That is most important.

Mr. TREADWAY. So I feel that I am justified in saying

The CHAIRMAN (interposing). The bill speaks for itself. Of course, the flexible provision and the negotiation of trade agreements could not both obtain in the same principle. One would be in conflict with the other. The amendment proposes that the flexible provisions remain in the law as to those countries with which this Government does not negotiate agreements.

Mr. TREADWAY. I would like to hear that read, that amendment that you have suggested. It has been referred to many times. I have never seen it.

The CHAIRMAN. I gave it to Secretary Hull. I do not have a copy of it now.

Mr. TREADWAY. All right.

The CHAIRMAN. Mr. Farrell, I have been very much interested in your statement, some of it very strongly endorsing certain provisions of the bill. If I correctly understood the position of the witness, it in

part supports the bill; in other respects it favors enlarging the bill in some respects, broadening the bill, but taking the bill as it is now, I am undecided in my mind as to the position of the witness, and if he speaks for the United States Chamber of Commerce, as he is speaking, if the bill must be taken as it is, with the amendment suggested today, under the present conditions, the present emergency, with the present President of the United States, would you favor or oppose the bill?

Mr. FARRELL. Well, I would favor the bill with the inclusion of those suggestions that I made, those three suggestions.

The CHAIRMAN. Suppose those three suggestions are not accepted? One suggestion was, if I understand it, that it not apply to those countries with which the United States does not have favorable trade treaties, favorite nation treaties. Is that right?

Mr. FARRELL. Yes.

The CHAIRMAN. The other was that the President be given authority to deal with the free list, place articles on the free list; also the dutiable list, transfer articles from the dutiable list to the free list; then the other was that the Board be set up to advise the President. Supposing neither of those provisions should be inserted in the bill, under the present emergency would you be in favor of or opposed to the bill?

Mr. FARRELL. As it stands? As the bill is written?

The CHAIRMAN. Yes.

Mr. FARRELL. No, sir.

The CHAIRMAN. That makes it clear.

Mr. VINSON. Now, Mr. Farrell, you said something, as I understood, that after the reciprocal trade agreements had been reached, they then went back to the parliament of the particular country. Is that correct?

Mr. FARRELL. Yes.

Mr. VINSON. Now, that does not occur with Canada.

Mr. FARRELL. Only when the parliament is not in session.
Mr. VINSON. Nor with British India nor Hungary.

Mr. FARRELL. When the Parliament is not in session.

Mr. VINSON. It does not occur in Canada, as I understand it, and British India and Hungary. In England it goes back to the Parliament for 28 days, and if no act on it be taken, then the agreement would become final.

Mr. FARRELL. You will probably recall that I only mentioned Canada and Great Britain. Now, if Parliament is not in session, then the Premier acts, but if Parliament is in session, then he has to refer it to Parliament before he can promulgate the order in council.

Mr. VINSON. I believe that the authority upon which I make this statement is correct; that is, that in Canada, British India, and Hungary, all that is necessary to make final the agreement is the notification to the Parliament without any action by the Parliament. Mr. FARRELL. Where do you get this information from?

Mr. VINSON. I am getting it authoritatively from the Department of Commerce.

Mr. FARRELL. Well, that ought to be correct.

Mr. VINSON. I certainly believe it is.

Mr. FARRELL. But I tell you, I have been affected myself by the action of an order in council in a business that I have a financial interest in that was closed over night. Now, when that went back for confirmation the whole thing was reopened again because Parliament was in session; but when Parliament is not in session in England and in Canada, then the Premier has plenary power.

Mr. VINSON. Mr. Farrell, do I understand that the Chamber of Commerce had a referendum upon this question?

Mr. FARRELL. A resolution in annual meeting.

Mr. VINSON. With what result?

Mr. FARRELL. Well, tremendously in favor of the resolution as incorporated.

Mr. VINSON. That is, the resolution that is found on the outside page of the document you presented to us, which contains so much interesting information, headed "Reciprocal tariff negotiations"? Mr. FARRELL. Yes.

Mr. VINSON. It has been some time since that was presented for the record. As I see that, your body, after the referendum to which you referred, went on record in May 1933 for a vigorous foreign commercial policy with reference to the safeguarding and advancing of foreign trade?

Mr. FARRELL. Yes. I wrote that.

Mr. VINSON. You wrote it?

Mr. FARRELL. Yes.

Mr. VINSON. And you further state that the present economic structure in its relation to world conditions, call for the most careful scrutiny of existing policies?

Mr. FARRELL. Correct.

Mr. VINSON. And further, keeping in mind always reasonable protection for American industry, your organization went on record that this Government should have power to initiate reciprocal tariff arrangements with foreign countries, where such bargaining would be clearly in our national interest?

Mr. FARRELL. Yes, sir.

Mr. VINSON. You kept in mind your advocacy of the flexible tariff provision, and suggested that such trade arrangements would be complementary to the existing flexible tariff policy?

Mr. FARRELL. Right.

Mr. VINSON. Now, I ask you if there is anything in this resolution adopted in May, 1933, that carries the three suggestions you made to the committee today, so far as the details are concerned?

Mr. FARRELL. Well, these resolutions are the resolutions of the chamber of commerce, the executive committee of 50.

Mr. VINSON. The executive committee of 50. Then whose recommendations come to us today, the recommendations of the executive committee of 50 or your personal views with reference to the three changes or amendments suggested in this hearing?

Mr. FARRELL. I am not testifying here to my personal views; I am appearing here as a representative of the Chamber of Commerce of the United States.

Mr. VINSON. When were the recommendations proposed by you prepared?

Mr. FARRELL. Which recommendations?

Mr. VINSON. The three suggested amendments.

Mr. FARRELL. They were prepared, I think, on the 2d of March. Mr. VINSON. On the 2d of March of this year?

Mr. FARRELL. They were prepared the day that we got the information that the bill was introduced.

Mr. VINSON. The day that you heard that this bill had been introduced?

Mr. FARRELL. Yes.

Mr. VINSON. Was the amendment which you have suggested considered by the executive council of 50?

Mr. FARRELL. Yes.

Mr. VINSON. In what way?

Mr. FARRELL. It was discussed and adopted.

Mr. VINSON. By the executive council of 50?

Mr. FARRELL. Yes, sir.

Mr. VINSON. How did you get them together?

Mr. FARRELL. We had our quarterly meeting on the 1st, 2d, and 3d of March, in Washington, at the Chamber of Commerce. It was on the agenda, put on the agenda.

Mr. VINSON. At that time you did not understand that the committee proposed the amendment in regard to 336, which is the flexible tariff provision making it only inoperative against articles dealt with in foreign trade agreements?

Mr. FARRELL. No; I learned that a few days afterward. In fact, I was not quite sure about it until Chairman Doughton told me this afternoon about it.

Mr. VINSON. As I understand it, on the question of taking this bill as is, with the proposed amendment directed at the flexible provisions with which you are in accord, you would not favor this power to initiate and execute reciprocal trade agreements?

Mr. FARRELL. I do not understand that question. I do not understand what you are intending to convey.

Mr. VINSON. I am simply asking if I understood you, if you had to say yes or no on H.R. 8430 with the amendment which was read, either read or explained to you by the chairman, which merely affects the flexible provision and makes it inapplicable to commodities affected by foreign trade agreements; now, if you had to vote it up or down, what is your position?

Mr. FARRELL. I would not vote for it.

Mr. VINSON. You would vote it down?

Mr. FARRELL. Yes; because I still insist that it is necessary in order to safeguard the situation of the business of this country, to have some consideration by the Congress in delegating all of these powers.

Mr. VINSON. Now, had the executive council of 50 given any consideration to the amendment which you bring to us today, back there in May 1933, when they adopted this resolution?

Mr. FARRELL. I do not recall.

Mr. KNUTSON. Mr. Farrell, you have repeatedly stated that you want section 336 retained in this legislation, the flexible provision? Mr. FARRELL. Yes; I would like to have it.

Mr. KNUTSON. You think this bill is very flexible, rubberlike! You could do most anything under it in the way of tariff making?