Mr. MARTIN. Do you know anything about the manufacturing of wearing apparel?

Mr. GUTTERSON. No, sir; I don't, except generally. I am a layman. Mr. MARTIN. You are not making any representation on the legislation then as to its applicability or desirability as it applies to wearing apparel; but a showing that it is not practicable in your branch of the industry.

Mr. GUTTERSON. That is right.

Mr. MARTIN. You may proceed.

Mr. GUITERSON. For further illustration as to why it is impracticable, I want to turn to page 6 of the bill which refers to the percentages of wool which should be used in connection with any wool product.

(b) No trade name, pictorial representation, term, or descriptive name suggesting or implying the presence of wool shall be used in connection with any wool product unless such wool product contains at least 51 per centum by weight of wool in proportion to the total fiber content.

Now, Mr. Chairman, if that were applied to carpets and rugs, as I have generally described their construction and fiber content, let me say that it would be meaningless, since the percentage of wool in the surface of the fabric, which is the pile, in relation to the percentage of jute or cotton has no bearing at all upon the question of the quality of the article.

In other words, we might have 80 percent of wool in comparison to the cotton and jute in one instance and only 50 percent in another instance and it might be that the weave and construction of the one containing only 50 percent would be a better quality than the one containing 80 percent of wool.

Therefore, if we had to conform to this provision it would be entirely misleading to the consumer. It would not represent quality, the essential of qualities in our fabrics. It would be deceptive and that is all I want to say in respect to that.

Mr. Chairman, I think that I have pointed out pretty definitely why our fabric should not be included in this bill. I do not want to take any more time than is necessary; but I would like to answer any questions that may be disturbing the committee on that question. Mr. MARTIN. Did you get any notice of the hearings on the Senate bill, or know that hearings were being held?

Mr. GUTTERSON. I heard the morning of the second day that hearings were being held. I telegraphed down to try to get an appointment and found that the hearings were not going to be continued, and I filed a statement with Senator Schwartz at the time, a copy of which I telegraphed you and asked if you would incorporate in the minutes of this meeting. Senator Schwartz told me he would. include my statement in the hearings of the Senate committee, and I would like to file here with you for the record the same statement which is applicable, that I filed with Senator Schwartz.

Mr. MARTIN. Leave will be granted for you to insert that statement and to revise and correct your remarks. They will be available tomorrow morning, if you should remain over, to look over and correct your remarks tomorrow morning, and extend them, and the same applies to all witnesses who will appear this morning.

68916-38- -15

The reason I asked you about the notice of the hearings, it is obvious that these hearings are very much more voluminous than the Senate hearings. We are having questions raised here, too, that were not raised in those hearings, and I just was rather curious as to why they are so much larger and the attendance is so much larger at these hearings on the bill over here in the House than they were in the Senate.

We thank you very much, Mr. Gutterson, for your statement. Mr. GUTTERSON. Thank you, Mr. Chairman. May I ask leave to have this statement inserted in the record?

Mr. MARTIN. Yes. Just hand it to the reporter. That and any other statement that you have, and then tomorrow you may revise and correct your remarks.

Mr. GUTTERSON. I have got to go back to New York this afternoon. I would like to send down, mail to you, anything further I care to submit on this.

Mr. MARTIN. Very well; mail it to the chairman or the clerk of the committee.

Mr. GUTTERSON. Thank you.

Mr. MARTIN. Thank you, Mr. Gutterson.

The next witness will be Mr. Nathan Goldstein, Merchant Ladies' Garment Association, New York, N. Y.

FOR

STATEMENT BY INSTITUTE OF CARPET MANUFACTURERS OF AMERICA, INC. INCLUSION IN THE MINUTES OF THE PUBLIC HEARING ON SENATE BILL 3502 IN COMPLIANCE WITH THE ADVICES OF SENATOR HARRY A. SCHWARTZ

INSTITUTE OF CARPET MANUFACTURERS OF AMERICA, INC.,
New York, April 21, 1938.

Hon. HARRY A. SCHWARTZ,
United States Senator, Washington, D. C.
DEAR SIR: Members of the Institute of Carpet Manufacturers of America
representing over 80 percent of the wool carpet and rug manufacturers of the
United States are opposed to Senate bill 3502 as now written. We believe there
would be no difference of opinion with our viewpoint by any member of this
industry.

GENERAL FACTS ABOUT THE INDUSTRY AND ITS RELATION TO THE CONSUMER

This industry is a well-established one in this country, being over 100 years old. Its mills are located almost exclusively on the eastern border of the United States and it employs, in normal times, upward of 32,000 workers. They are highly skilled and the weaving of our fabrics is a specialty. The space and type of machinery required for the manufacturing is extensive compared to many other industries and accordingly the capital outlay including that for operation is very substantial.

The above sketch of our industry is presented to indicate that wool carpets and rugs, manufactured for so many generations in this country, are a wellknown and established article among American consumers; that our respective mills have built up their own reputation and brand names with the consuming public and that therefore any legislation affecting the identification or designation of our fabrics, both as to type and method, are of extreme importance not only to ourselves but to the consumer.

FUNDAMENTAL DIFFICULTIES IN THE BILL ITSELF

The bill, as presented (S. 3502), might be interpreted to include wool carpets and rugs although it would seem it has been definitely drawn with the problems of other textile fabrics in mind than of carpets and rugs. We are led further to this belief because the provisions of this bill seem to run very parallel with certain proposals for trade practices by certain textile interests before the Federal Trade Commission, which textile manufacturing interests

have definitely recorded themselves with the Commission that they had no intention of including wool carpets and rugs in the type of trade practices proposed.

In the first place our raw materials, wool and jute, which comprise about 80 percent of what goes into our fabric come entirely from foreign sources. This industry has to use a wool which is of such nature that its requirements are not met by the more refined wools produced by the wool growers in this country. This industry from its inception has used foreign wools and, therefore, does not and cannot compete with domestic wools produced for clothing, blankets, and other purposes.

In the second place our industry does not use, to our knowledge, any materials made by the breaking up of any finished fabric or what is popularly known as shoddy. In other words the varieties of wool we use fall into three groupings as wool prepared and used in our fabrics:

(a) What may be termed “virgin wool”; (b) card waste or noils made directly from virgin wool; (c) waste made by breaking down yarn which consists either of virgin wool or card waste or noils from same.

All these categories are of raw wool, and strictly speaking, virgin wool, and are properly so designated since they have never before been made into a fabric subjected to the wear and tear of use and then broken up for rework. То further describe the use of broken-up yarn in the carpet industry, as indicated above, this material, although it would constitute only a small part of the raw material employed, when used, has never been subjected to weaving nor the vicissitudes of unknown and detrimental uses, such as in the case of shoddy or shoddy yarns. On the contrary, although in the process of breaking up the original yarns to secure single fibers the length of the individual staples is diminished, nevertheless the shortened staple still has the qualities of unused wool and cannot be considered in the category of what the bill seems to consider as reclaimed wool, the definition of which would indicate that it includes those textile materials which have reached a finished state. Consequently any variety of wools used in our industry cannot be classified correctly under the designation in this bill-virgin wool and reclaimed wool.

Therefore, we submit that if the identification or labeling laws set forth in this bill are to attach to our fabrics it is essential at the outset that the word "spun" be excluded from paragraphs C and D on page 2 of S. 3502. It would be entirely unjust to our industry and as to the consumer, entirely misleading and misinforming as to our fabrics, if the word "spun" is included in the definition of either virgin wool or reclaimed wool as set forth in the bill.

Moreover, apart from a vital misstatement of fact to the purchaser, imposing a serious and impractical stipulation into our manufacturing operation, if the act, as written, is put into application in respect to the carpet industry there is no question that the cost of many types of carpets and rugs which represent good merchandise would be materially raised to the consumer without any corresponding benefit to the consumer or to the wool grower or to anyone else. It is quite obvious that the bill under question was written in order to prevent the inclusion of shoddy or similar waste materials in a fabric which might subsequently be sold as virgin wool. It is a problem which may be important as to other textile industries, but it has no bearing on the carpet and rug industry. It may be theoretically possible for the carpet manufacturer to use a small percentage of shoddy yarn in the creation of very cheap merchandise and if one can be found who does so, it would be such an isolated case that any attempt to include the carpet and rug industry as a whole in the bill proposed, would perform a serious injustice to the whole industry and actually place our virgin wool, under the present definititon, in the posittion of a possible shoddy material. If the word "spun" is to be retained in said paragraphs mentioned for the purpose of dealing with other textiles, the only logical thing to do both in the fair treatment of the industry and the consumer would be to specifically eliminate the industry from the terms of the act.

With respect to paragraph E of section 5, which provides for complete and accurate records showing the exact fiber content, this might be feasible for our industry provided the word "spun" is eliminated from the definition. Otherwise it would be extremely difficult for the manufacturer to keep an accurate record in the mill of the exact disposal of all the waste material without adding materially to the cost of the manufacture, which in turn would have to be passed on to the consumer without in turn passing on any corresponding gain. With every sympathy for all reasonable attempts to prevent misbranding of fabrics, the impression one gains from the wording in the bill is that it will inevitably result all along the line in high cost to the consumer

and without improving the product. For example, if surplus yarn (which has not gone into any finished fabric) may not be broken up and worked into a fabric, the loss entailed by the removal of this material by manufacturers will force a higher price to the consumer since the carpets and rugs which have been relieved from any use of broken-down yarn will have to absorb the losses. This would not be so bad if the consumer were not really getting his or her money's worth in the light of the fact that these materials (waste and brokendown yarn) are really new and hitherto unused fibers. However, as the facts above indicate the cost to the consumer would be raised with no offsetting advantages.

Under the topic of the bill entitled "Misbranding Goods," section 4, paragraph A, it is stated that no trade name, pictorial representation, etc., implying the presence of wool shall be used in connection with any wool product unless such wool product contains at least 51 percent of weight in proportion to the total fiber content. May we point out that such a designation would be entirely unfair and misleading to the consumer if imposed upon our industry. This paragraph is evidently intended to apply to finished textile products, such as clothing, etc., where the wool content and other possible fibers become a conglomerate and indistinguishable part of the finished product itself in the manufacturing or weaving process. In our fabric the wool goes into the surface or pile of the article and serves an entirely separate purpose from the usual cotton and jute yarns in the base of our fabrics which are materials separate from the wool going into the construction. Therefore, the percentage of wool in comparison to the usual cotton and jute, for instance, in our fabric is not a controlling factor as to quality and any such provision as above referred to would be entirely wrong and misleading and impossible to apply to our fabric in carrying out what we understand is the intent of said paragraph B in connection with the protection of the consumer.

We have not attempted to go over every section of the bill, applying the outstanding principles which we have tried to set forth above. We believe a detailed application is not essential in the light of the fundamental difficulties that this bill at once presents to our industry. We have attempted to give you the chief factors which make the proposed bill entirely inappropriate and unworkable in our industry if the attempt, as indicated, is to give the consumer an honest and fair presentation in order that the consumer may identify not only materials contained in the fabric, but their relative qualities.

IMPORTATIONS

We wish to point out one other viewpoint as to the general objectives of such legislation as is proposed in this bill. It revolves about the fact that while it is proposed to hold American manufacturers to a very strict law and supervision in the way of identifying and labeling merchandise there is no provision at all that importations of similar fabrics from abroad shall contain similar labels and guaranties. In other words it seems from the provisions of the bill that so long as a foreign manufacturer does not brand his goods at all, they may aparently be brought in without being subjected to the regulations to which the American manufacturers are to be put. We respectfully submit that it would almost appear from the phraseology of the bill that the latter has been drawn up in such a way as to actually exempt importations from regulations; and you will note that section 9 refers in two places to guaranties signed by authorities residing in the United States. It appears to us that the bill should certainly not go into effect in any case nor with respect to any domestic industry without first enacting similar protective measures for foreign merchandise. In other words the American consumer is to be protected so far as to what is American manufacture and what the American worker produces, but there is to be no protection of the American consumer against importations from foreign manufacturers and foreign workers. Apart from the American consumer it would seem to us entirely unfair to the competition to which our own workers are put by foreign importations.

CONCLUSION

In the absence of an opportunity to bring out by discussion at hearings the various technical problems involved, in a bill of this nature, we have attempted to give you the most important features which must be taken into consideration, so far as our industry is concerned, in any attempt to identify by labeling the fiber contents of wool carpets and rugs. You should note by the implication

of the comparisons we have made to other textile fabrics that the problem of identification in those is entirely different than for carpets and rugs.

We submit that it is impractical, unjust, and not helpful or instructive for the protection of the consumer to attempt in one bill to cover the identification and labeling of all textiles which may include wool or wool products. We submit that if such a bill covering a wide variety of textile fabrics seems essential it would have to be simple and most general as to the labeling and identification requirements or injustice is bound to ensue both to the manufacturer and the consumer. As the bill stands also it would make it virtually impossible for the manufacturer to comply truthfully, deceive the consumer, increase the cost of our fabrics to the consumer, with no corresponding gain, and bring no advantages to the wool grower in this country.

We submit, therefore, that the bill be given far more consideration in the interest of all concerned.

Respectfully submitted.

INSTITUTE OF CARPET MANUFACTURERS OF AMERICA, INC., BY HERBERT GUNDERSON, President.

STATEMENT OF NATHAN GOLDSTEIN, REPRESENTING THE MERCHANT LADIES' GARMENT ASSOCIATION, NEW YORK, N. Y.

Mr. GOLDSTEIN. Mr. Chairman and gentlemen of the committee: I appear for the Merchant Ladies' Garment Association, which is an association of garment manufacturers of ladies' ready-to-wear in the city of New York.

There will be certain other witnesses in the course of the morning who will represent certain others of the association in the city of New York, the combined membership

Mr. CROSSER (interposing). How do you represent the Merchant Ladies' Garment Assoriation?

Mr. GOLDSTEIN. We are the attorneys for them, Mr. Congressman.; Mr. CROSSER. You are the attorneys for them?

Mr. GOLDSTEIN. Yes, sir.

Mr. WITHROW. Have they a regular organization

Mr. GOLDSTEIN (interposing). They are a trade organization whose purposes are to supervise and represent the membership with respect to their relations with labor and also for fair-trade practices.

Mr. WITHROW. Is it composed in part of representatives of labor? Mr. GOLDSTEIN. It is not, Mr. Congressman. It is composed of employers.

Mr. WITHROW. Of the employers?

Mr. GOLDSTEIN. Of the employers.

Mr. CROSSER. Are you technically informed on the subject?

Mr. GOLDSTEIN. I hope that I am, to some extent, technically informed on the subject; to the extent I am not technically informed on the subject, we will produce witnesses who are.

Together with the other trade associations in the industry who also are represented at this hearing, the membership of the combined associations covers approximately 85 percent in dollar volume of the cloak and suit business done in the entire country.

The views which I am about to express and the views which others of the members of the associations appearing will express represent the considered conclusions of the combined membership. That conclusion was reached only after each member in New York was individually canvassed and the problem presented to them individually.