radoan. If you haven't got your name on the list, I suggest you write it on a piece of paper which we will provide for you, and hand it to him and tell him what you want, and whom you are going to testify for.

Next to Carl sits our assistant counsel on the committee, Bynum Hinton.

I wish you would all feel at home and ask any questions you please. We will ask the witness to come up to this chair, if he will. It looks like we are going to have to get some more chairs.

First I see here sitting in the row the president of the Colorado Mining Association, Mr. Harrison S. Cobb.

STATEMENT OF HARRISON S. COBB, PRESIDENT, COLORADO MINING ASSOCIATION

Mr. COBB. Congressman Hill and members of the Select Committee: We people of Colorado are highly honored that you have decided to hold your first hearing here in Denver, the mining capital. We appreciate that you are interested in our problems and will help us work out a solution if we can do that. We want to save your valuable time, and we intend to make these statements brief, factual, constructive, and to the point. May I take this opportunity to remind every witness to make his remarks with that in mind.

We are also glad to have Congressman Hill with us in our home State, and we welcome each member of the committee. We want this brief stay in Denver to be a pleasant experience. If the Colorado Mining Association can do anything to help it to be so, please call

upon us.

Bob Palmer is going to make a general statement about the industry, so I will simply welcome you to Denver.

The CHAIRMAN. Thank you, Mr. Cobb. We are all glad to be here. Is Bob Palmer ready to testify?

STATEMENT OF ROBERT S. PALMER, EXECUTICE VICE PRESIDENT, COLORADO MINING ASSOCIATION, AND MEMBER, NATIONAL COMMITTEE ON LEAD AND ZINC

Mr. PALMER. Mr. Chairman, I present you, sir, with a statement of the production of lead and zinc in the State of Colorado from the beginning until the present, simply to show you that statistics on production of metals are not necessarily conducive to sound conclusions. There are those in the United States today who would attempt to use statistics to show that the mineral reserves of the United States have been exhausted. It is our contention that the dips and curves in production in the lead and zinc industries in the State show conclusively that it is the economic condition of the industry which encourages production or discourages production.

We wish to relate to you, and we think that witnesses will appear before the committee who will show you, that it is a horrible thing to close down a mine. Many times mines are operated at a loss rather than to destroy an entire community and put a lot of men out of work. There will be witnesses at this hearing who come here to show you that entire communities are being destroyed. We were told just yes

terday by the manager of the one smelter that we have in the State that unless the present economic condition in the industry is corrected, that the smelter will have to close, which is the only market that we have for lead in the State of Colorado.

There will be witnesses here, I am told, from Utah, who will relate that unless the situation in zinc is corrected that the smelter at Tooele, Utah, will be unable to reopen.

The point that I wish to make at the beginning of my statement is that this situation is very serious, and if there is anything we can do to help the committee clarify the situation we will do so.

(Data on mine production in Colorado follow :)

Mine production of lead and zinc in Colorado, 1869 through 1952

Mr. PALMER. I have a statement here which I wish the committee to know is not the opinion of the witness, necessarily, but it is a compilation of data which has been sent in to the State agencies, such as the state metal-mining fund, of which I happen to be the executive director, and the State mineral resources board, of which I also happen to be executive director.

Our Governor expressed the desire to appear before this commitmittee. He has expressed a desire of all of the western governors to unite in some program to help the Congress solve this very difficult problem. Unfortunately, I understand that he is in the South today and could not attend this hearing.

The mining industry of the United States welcomes this opportunity to present its case for immediate passage of legislation to the Congress of the United States. In February of this year the industry, under the sponsorship of the Colorado Mining Association, held a nationwide conference in Denver to which were invited representatives not only of all segments of the mining industry but numerous branches of the consuming industries as well. The program which we here sponsor was adopted by unanimous action of those in attendance. Briefly, in the interest of national defense and security, it involves the imposition of a sliding-scale stabilization import tax on zinc and lead. In substance, the plan has been incorporated in the lead and zinc section of the bill introduced in the Congress of the United States by Richard M. Simpson of Pennsylvania, a member of the House Ways and Means Committee. This section recognizes the vital necessity of maintaining a sound, healthy, active lead and zinc industry within the United States in order to meet the requirements of the Nation's industrial plants and to serve its military requirements both in peace and in war.

The Congress of the United States in our judgment has recognized the principle in the Stockpiling Act (Public Law 520), that "the United States should not place a dangerous and costly dependence upon foreign sources for its metals." The Congress has also investigated at numerous hearings currency fluctuations by foreign governments and is advised as to the effects of these devaluations upon the lead and zinc industries.

Here I would refer the committee to the briefs filed by the Emergency Lead Committee before the United States Tariff Commission, copies of which were sent to all members of the Congress.

Congressman Simpson's bill is designed in substance to save the industry from destruction for, in providing a sliding-scale stabilization import tax on lead and zinc, he proposes to maintain the American standards of living within the mining regions of the Nation. A base price on lead and zinc, upon which the tax is to be determined, is fixed at 152 cents, adjusted periodically by the Bureau of Labor Statistics' index on primary market prices for other than farm and food. It amounts to 1 cent, plus 1 cent per pound for each 1 cent the market price is below the base price. For ores and concentrates imported into the country, the tax would apply in a similar manner but in an amount of seven-tenths of a cent per pound for lead content and six-tenths of a cent for zinc content.

The legislation is not designed to cut off imports of lead and zinc from abroad for it is recognized, both by the mining industry and the consuming metal industries of the United States, that some imports of these metals are needed in ordinary years as well as in times of emergency to supplement domestic production. The legislation wisely provides that no taxes will, therefore, apply when the domestic market price equals or exceeds the adjusted base price of 152 cents per pound which, in fact, is a realization of the cost of production within the United States if we are to maintain the living standards of the American workmen, and in particular the highly skilled miners who produce the lead and zinc in the United States. There will be no restriction of opportunity for foreign lead and zinc to find markets in the United States, nor will the consumer be confronted with shortages such as he faced in the early part of the last year when foreign

prices ranged upward to 222 cents and more for lead and 314 cents for zinc. At that time duties of seven-tenths of a cent on zinc and 1116 cents a pound on lead were suspended under the law which provided that these modest duties would be restored whenever the domestic price dropped below 18 cents for 30 days. The lead and zinc section of the Simpson bill would renew the import tax whenever the price of lead and zinc equals or exceeds the adjusted 151/2-cent base in the domestic market.

The industry, in supporting the provisions of the Simpson bill, believes that they are fair and reasonable and in comparing the base price of 152 cents in the bill with the Government selling prices recently removed of 1912 cents per pound for lead and zinc, it is quite evident that the mining industry is not taking an unfair advantage of the present or any future situation.

The Office of Price Administration and the authorities of the Government fixed those prices, and which prevailed until recently, of 19 and 1912 cents on these metals. But the foreign price, as was indicated here, rose as high as 222 cents for lead abroad, and 311⁄2 cents for zinc.

In presenting the case of the mining industry, it has always been most difficult to present a united viewpoint. There are those whose interest is primarily connected with the smaller segment of our industry and, of course, the larger segment has always been very outspoken and its position has generally been known throughout the Halls of Congress. It is a most fortunate position to be in to present the united position of our industry. As evidence of the unison which exists throughout the United States, your attention is directed to editorials which appeared recently in the leading mining magazines of the Nation.

The Mining World, for example, which is published in San Francisco, in its issue of March 1953, on page 29, stated:

The most important development in the lead and zinc industry in the last 20 years was announced at the Colorado Mining Association's convention in Denver on February 12, 1953. By unanimous agreement, lead and zinc mining and smelting spokesmen, representing every mining district in the United States of America, agreed on a program. The National Emergency Committee on Lead and Zinc, headed by Otto Herres, of Salt Lake City, recommended that in the interest of national defense and security the legislation (here referred to) is needed without delay for preservation of the domestic lead and zinc industry.

Another leading mining publication, the Engineering and Mining Journal, published in New York City, in its March editorial found on page 71, states in part as follows:

Here I would like to make this observation for the committee that this is the first time in my experience of 15 years that the Engineering and Mining Journal has ever reflected the sentiment of the smaller segment of the mining industry.

We also endorse the stand taken recently by the emergency committee of zinc producers at the Colorado Mining Association meetings in Denver. With unusual unity, these producers, large and small, joined in calling for a sliding-scale import tax to be levied on imported lead and zinc whenever the domestic prices of these metals should fall below certain agreed-upon base prices.

We approve the basic elements of this plan because we believe it comes nearer an equitable solution of a serious industry problem than any other suggestion we've heard.

On the first place, it is useless to talk about free trade among nations, as it exists among the United States, because the political and economic imbalances 84376-53-2

among nations are far too great. North Dakota and Arizona can trade wheat and copper freely and easily because politically, financially, economically they are about equals. There are very few pairs of countries in the world one could site as similar examples. To strike all the world's tariffs off the books and then shout that trade has been freed, would be as foolish as to release the brakes on a car whose gas tank was dry and expect it to leap ahead up a hill. The world's currencies have to be strengthened, its standards of living built up; there has, in short, to be gas in the tank before the car can move.

United States lead and zinc miners have been victims of mistaken government policies in the United States, England, France, and elsewhere. When the United States piled its stockpile program on top of surging civilian and military demands, the other nations took fright and bought metals frantically, fearing our huge buying power would divert the world's metal to the United States.

Big stockpiles, some built with United States funds, thereupon accumulated in Europe. It is reported, for example, that 200,000 tons of zinc remains in Europe to be disposed of. Finding they had bought vastly more than they could use, the European governments began to dispose of this metal, at about the time, unfortunately, when United States markets began to waiver.

The editorial, therefore, explains that not only were Americans subjected to the dumping processes of foreign governments which destroyed our mining economy, but we have also been forced to compete with international cartels which dump their ill-gotten products on our markets at any prices they may see fit to sell them and force American industry, regardless of size, out of business for we cannot possibly compete with foreign government cartels.

The editorial then continues with the following language:

This is trade, of a sort, but it is doubtful if it can be called free. The slidingscale import tax is aimed only at requiring imports to come into this country on a basis fair to American producers. It is not aimed at blocking imports. In closing, the editorial reads as follows:

As a matter of simple justice to American producers and to foreign producers as well, we would like to see the sliding-scale import tax tried. We commend its authors, and we commend the willingness of the several segments of the domestic industry to yield some part of their special interests for the sake of getting together in unified support of this program.

Another leading mining publication, the Mining and Contracting Review, in an aditorial in its March issue, says in part:

An impressive start toward unity was made in Denver when the nationwide national committee on zinc-lead legislation came to unanimous agreement on the necessity for a lead-zinc equalization tax to preserve the domestic industry.

Thus it can be seen not only the industry, but the editors of all of the leading mining magazines of the Nation are in total sympathy with the program. The logic of the approach is more particularly set out in a scientific article prepared by Dr. T. S. Lovering before the Geological Society of America, which was published in its bulletin of February 1953. The reason presented in this excellent paper is quite distinctive in that it is quite different from the haphazard guessing contest entered into by certain unfortunate worldwide theorists who engage in the preparation of Presidential reports, such as the so-called Paley report and the more recently published report by the Public Advisory Board for Mutual Security, signed by D. W. Bell, a Washington banker. The full text of the excellent presentation by Dr. Lovering cannot be given at this hearing, but the following is given as an indication of the excellence of this paper.

It would give a predictable basis for wage negotiation. It would give assurance of fair returns for long-range development programs in the mineral industry, and thus do much to take care of the time lag in the development of mines.