Milford chronicle., 1915-09-17
SALES OF AMERICAN PRODUCTS
ABROAD gives OUR LABOR WORK

Washington, Sept. Il, Special Core,
spondence) The reason why domes-
tic manufacturers should market their
products abroad occasionally at a price
even somewhat less than the cost OF
manufacturing, seems absolutely bevond
the mental grasp of the average Demo-
craft said prominent authority on our
foreign trade recently. when the pres
ert Seer etary Of Commerce, Mr.. Redfeld
was in Congress, during the discussion
of the so-called 'pop-gun' tariff bills in
troduced by Mr.. Underwood for the pur-
pose of recording the veto of then Presi-
dent Taft, he led the attack on this fea-
ture of price reduction, and this attitude
OF the Democracy was crystalized in the
Baltimore platform, which declared
among other things, that articles enter
ing into competition with articles of Ameri-
can manufacture which are sold abroad
more cheaply than at home should be put
on the free list. a"
The only time this selling policy is
adopted in this country is when a surplus
is produced which cannot be marketed at
home, in which case it may be sold abroad
at whatever price can be obtained for it
and thus labor and capital are kept en-
ployed, even though there is a cut in
profits. But in Germany this dumping
policy is a regular part of the German /
campaign to sell products at dumping |
prices in order not merely to get rid of |
odd lot or surplus stocks, but more |
broadly, to keep their factories running !
at zoo per cent efficiency, thus reducing |
the unit cost to a minimum. While |
England is the pioneer in this dumping
movement, Germany is to-day its chief |
exponent The handicap to domestic
factories employing American workmen
by reason of difference of cost, elimina-
ton of all profits, and often inferior
quality of the foreign article, must be
experienced to be appreciated.
As concrete example of how a cut
price sale of surplus American stocks
would work to our advantage. take the
manufacture of shoes, the average pro
INT on which, IN all the factories of the
United States, is from seven to eight
cents pair, when running at full capac-
ity. Now, if the manufacturer ran his
factory at full capacity three. fourths of
the time and shut down one fourth of
the time, his profit would be cents
pair but if he sold three fourths of his
output at full price, and the rest at cost,
abroad, he would make cents a pair on
his total output. If he manufacturers
j ,OOO, 600 pairs of shoes a year when run
ming at full capacity his profits for the
year at cents would be $50, 900. If he J
ran full capacity, but sold one-fourth his I
product at cost, his profit would be 500
OOO. But if he ran three fourths of the S
time at full capacity, and shut down his
factory one-fourth of the time, his profit g
would be S22, 500, i. e.. 5 cents on 750,- $
600 pairs of shoes.
1t IS plain to be seen, therefore, that
ne could afford to run his factory at full L
selling one-fourth of the output 9
At loss of IS cents a pair, and still come 4
)ut at the end of the year with the same
net proht that he would get if he ran his o
factory three-fOurths of the time at its
III! capacity and shut down for the re- I
nainder of the year, to sav nothing of p
he TACT that he would keep his labor or
together aud on the payroll. y
nd his capital employed. In addition K
o that, where he gets into a foreign j.
narke; with his product he makes lust
nat much progress in eliminating for NJ
ign competitors b
But the trade restrictions which in "a
vtably accompany a Democratic Admin
'tration result i'll the American manu- W
icturer fighting a losing battle to retain
IS own home market. The extent to 'e
hich that home market is lost, when oil
lie prohibitions of war do not intervene.
a matter of common knowledge to WI
very student of import statistics under =,
ee trade or tariff for-revenue law. Once IN
eace IS declared abroad, Germany, from us
ie ramparts of her high tariff wall, will us
us with great masses of manu-
ctured products now accumulating en- e.
thin her boundaries. She will take uo
II pay in raw materials with which to
ntnue her trade war upon US. Ne III
Administration can meet that on
nation consistently with its past record. ma