Mr. FORDNEY. The Tobacco Trust was punished for that very same thing, and the Rubber Trust-they have been after the Rubber Trust, but I do not know whether they got them.

Mr. CORDES. My understanding is that if you can prove that I am violating the Sherman Act or discriminating-but I am not discriminating.

Mr. FORDNEY. My dear friend, I do not have to prove it, if you will admit you have an agreement of that kind. The Supreme Court has repeatedly decided that it is an agreement in restraint of trade and therefore is in violation of the Sherman antitrust law.

Mr. CORDES. Has that any relationship to the question of establishing the price of an article or the tariff on it?

Mr. FORDNEY. Your price that you give as a minimum price to the merchant or retail man has nothing to do with the tariff.

Mr. CORDES. That is simply a statement that I was trying to make. I could not see why Mr. Harrison asked the question, because all I was trying to show was that we get the same price here that we are getting elsewhere.

Mr. HARRISON. To turn your thoughts to pleasanter paths-for we do not want to embarrass you, and do not desire to embarrass any person I seriously asked the question about your prices here and in Canada for the reason that you have suggested that a witness this afternoon was mistaken when he said that the prices to the jobbers were cheaper in Canada than in the United States on the prophylactic tooth brush. You have just testified that all the jobbers who were good and you said they were all good-get your tooth brushes at $23.75 a gross. Is that correct?

Mr. CORDES. $23.25; yes, sir.

Mr. HARRISON. $23.25. At what price do you sell them per gross to jobbers in Canada?

Mr. CORDES. We sell the brushes in Canada at $27, I think the price is, and the duty brings the net somewhere in the neighborhood of $21.

Mr. HARRISON. Then $21 in Canada and $23.25 in the United States

Mr. CORDES (interposing). Mr. Harrison, on top of that we have to give the retailer 20 additional brushes; we carry a liability on our books, for every gross we send out, of an additional 20 brushes that the retailer gets, which is another reduction of $3.75.

Mr. HARRISON. The jobber in Canada does not get a discount, does he?

Mr. CORDES. No, sir.

Mr. HARRISON. But your jobbers' price per gross in Canada is $21, counting out the duty?

Mr. CORDES. Yes, sir.

Mr. HARRISON. And it is $23.25 to the good jobbers in the United States?

Mr. CORDES. Yes. But what am I going to do with the other 20 brushes that I have charged against me a liability, that go to the retailer? They are provided for and it is an additional discount. I do not get that in cash.

Mr. HARRISON. But I am not interested, for the purposes of this question, in your activities as a distributing agent; but as a manu

facturer it is a fact that your prophylactic brushes per gross are sold for $23.25 in the United States to jobbers?

Mr. CORDES. Yes.

Mr. HARRISON. And $21 per gross, duty off, to Canadian jobbers? Mr. CORDES. That is right.

Mr. HARRISON. Therefore the witness this afternoon seems to be well informed when he made that statement?

Mr. CORDES. I do not think he was wholly right. I sell them with that other handicap for which you do not give me credit.

Mr. HARRISON. I think in the further process of distribution I can see the point; but just as a manufacturer, selling to the jobber, and assuming that your activities end there, it is true that your price is less to the jobber in Canada than to the jobber in the United States.

Mr. CORDES. Your viewpoint and mine are wholly different. I do not see how it is, because I am basing my statement on the fact that I am not getting the money. I am only getting $19.50 per gross net here. That is all I am getting.

Mr. HARRISON. No; I think you started with $27 per gross as your price, and then the discount to the jobbers brought it down to $23.85? Mr. CORDES. Yes.

Mr. HARRISON. For the purpose of discussing the attitude of the manufacturer toward the tariff, his price to the jobber is the only thing which we are warranted in taking into consideration. We have no right to assume the manufacturers are also their own selling agents and to pursue the brushes through to the retailer.

Mr. CORDES. I do not think that is fair.

Mr. HARRISON. I am not trying you. This is not a court of law and I am not pronouncing judgment on you; but you questioned the accuracy of the statement of a witness, and I think you have yourself proven was accurate in making the statement.

he

Mr. CORDES. So far as he went, but I want to have it accurate as to the rest of the proposition. I only get $19.50 a gross.

Mr. HARRISON. Have you a selling agreement with the retailers?
Mr. CORDES. Yes.

Mr. HARRISON. And they get a discount if they are good?
Mr. CORDES. Yes, sir.

Mr. HARRISON. And it is pretty ironclad arrangement you have, is it not?

Mr. CORDES. No; it maintains a minimum selling price of 25 cents, to which we were forced to come down in competition with foreign manufacturers. They made it impossible to sell the brush beyond that. Twenty-five cents if the retail price. We say to them, "If you do not sell at less than 25 cents, we have to stand for that other 20 brushes," and it makes the brushes net us $19.50 a gross, and you can not figure it any other way.

Mr. HAMMOND. Do I understand the brushes are worth $23.75 a

gross?

Mr. CORDES. Yes, sir.

Mr. HAMMOND. And you sell to the American jobber for $27 and then you hand him $3.75 in brushes?

Mr. CORDES. Yes, sir.

Mr. HAMMOND. You sell to the Canadian for $21, and you hand him 20 brushes?

Mr. CORDES. No, sir.

Mr. HAMMOND. How do you get down to $19.50?

Mr. CORDES. Because we go to the retail dealer in the United States and hand him 20 brushes. I think that is very clear.

Mr. HARRISON. Do you give 20 brushes to your customers too? Mr. CORDES. Hardly.

Mr. HAMMOND. Then you turn back 20 brushes to the wholesaler and you turn to the wholesaler 20 more brushes for the retailer?

Mr. CORDES. No; we send the brushes to the retailer himself. He sends us a certificate found in every box of brushes, and when that certificate comes to us we send him the brushes for it. The jobber does not have anything to do with that distribution of the retailer's 20 brushes.

Mr. HAMMOND. That makes the $19.50 you really get out of these brushes sold in the United States?

Mr. CORDES. Yes, sir.

Mr. HAMMOND. You sell the same brush for $21 in Canada?
Mr. CORDES. Yes, sir.

Mr. HAMMOND. Do you return any brushes to the Canadian jobber?
Mr. CORDES. What do you mean by returning them?

Mr. HAMMOND. Do you distribute these 20 brushes among the Canadian jobbers?

Mr. CORDES. No; we do not.

Mr. HAMMOND. So there are no certificates in the boxes you sell in Canada?

Mr. CORDES. No, sir.

Mr. HAMMOND. Then, according to your statement, you get $19.50 for brushes sold in the United States and $21 in Canada?

Mr. CORDES. Yes, sir; that is right. That was what I was going to say. The gentleman said, "In the neighborhood of $20 or $21. I claim we sell them the same practically the world over.

Mr. HULL. I do not understand exactly about this trade agreement. Does this extend to other rival businesses here and elsewhere? Do they maintain the minimum price?

Mr. CORDES. What do you mean by other businesses?

Mr. HULL. Other rival businesses. I understood you to say a moment ago that you were obliged to fix this on account of the action, I think you said, of the foreign trade.

Mr. CORDES. Í say, fix the retail price.

Mr. HULL. Do they fix the retail price in other countries?

Mr. CORDES. I do not know about that. I do not think so. We have no jurisdiction over them, and do not try to have. In fact, we do not have any jurisdiction over any of them. If a retailer does not want to sign this agreement, and does not want to keep up the prices, he can do as he pleases. He can give the brushes away.

Mr. HULL. Do other concerns, engaged in the business of manufacturing, fix the same retail price?

Mr. CORDES. I think there are such in various lines; yes.
Mr. HULL. Does that extend generally over this country?

Mr. CORDES. I think so; yes, sir.

Mr. HULL. Is that through an understanding among you and other

Mr. CORDES. Absolutely not.

Mr. HULL. Each one has proceeded separately to arrange the same trade agreements, so as to limit the retail price at 25 cents?

Mr. CORDES. As it affects their own particular line of business; certainly.

Mr. HULL. Well, the price limit of 25 cents which they fix, I suppose, is upon a similar article in quality and merit, is it not?

Mr. CORDES. As far as I know. I do not know of any other article in our particular line. Please remember, so far as toothbrushes are concerned, there are only a few made in this country. Our company and the Rubberset Co., of Newark, N. J., and the Celluloid Co., of New York, I think, are the only American toothbrush manufacturers. Mr. PALMER. How long have you been making toothbrushes? Mr. CORDES. About 20 years.

Mr. PALMER. The Prophylactic brush?

Mr. CORDES. Yes, sir.

Mr. PALMER. Was that a patented brush?

Mr. CORDES. It was. The patent has expired.

Mr. PALMER. The patent was on the method of making it?

Mr. CORDES. The construction of the bristle head.

Mr. PALMER. The back?

Mr. CORDES. The serration of the bristles, Mr. Congressman.
Mr. PALMER. That patent has expired?

Mr. CORDES. Yes, sir.

Mr. PALMER. Where is the plant located?
Mr. CORDES. Florence, Mass.

Mr. PALMER. How large a plant is it?

Mr. CORDES. We employ about 500 people, but we make other things besides toothbrushes. We make hairbrushes, clothes brushes, military brushes, toilet sets, and hand mirrors.

Mr. PALMER. You make them all in your factory, do you?
Mr. CORDES. Yes; we make them all in our factory.

Mr. PALMER. Do you not send some of them out?

Mr. CORDES. Yes; we send out some.

Mr. PALMER. Then, you do not make them all in your factory?

Mr. CORDES. What I mean is, a few toothbrushes we do not make

in the factory. We do not draw the bristles in the factory. Ninetyfive per cent of our goods are made in the factory, however.

Mr. PALMER. And where are the other 5 per cent made?

Mr. CORDES. A few in the homes.

Mr. PALMER. By what kind of labor?

Mr. CORDES. By women.

Mr. PALMER. And children?

Mr. CORDES. No, sir.

Mr. PALMER. Is it not a fact that the manufacture of these prophylactic toothbrushes in the homes of the poorer classes in your neighborhood has come to be something of a scandal-the employment of child labor?

Mr. CORDES. No, sir; it is not, sir.

Mr. PALMER. You do not do much of that?

Mr. CORDES. NO; I say its becoming a scandal is not true.

Mr. PALMER. Well, it is a fact that there has been much criticism of it, is it not?

Mr. CORDES. No, sir; I do not know of any criticism.

Mr. PALMER. You do not?

Mr. CORDES. No, sir; I do not see why there should be. If there would be, I would know it. I happen to be the president of the Society for the Prevention of Cruelty to Children in my city.

Mr. PALMER. Perhaps that is the reason there is no criticism.

Mr. CORDES. No; I do not think so. The position is honorary and I think if anything was the matter, the agent would call my attention to it pretty quickly.

Mr. PALMER. I am not meaning to cast any reflection

Mr. CORDES (interposing). I am very glad you asked that question, because I want to state the exact facts. Some of the women who do that work in our city are from the best families in Northampton and Florence. They come to our factory in carriages, and get the goods. They want this work for a little pin money. It is a very small item. Mr. PALMER. Do they return the goods to you in automobiles? Mr. CORDES. They sure do.

Mr. PALMER. They do?

Mr. CORDES. Yes, sir.

Mr. PALMER. How about these other manufacturers of toothbrushes; are their methods the same as yours?

Mr. CORDES. As far as I know.

Mr. PALMER. The other two companies

Mr. CORDES (interposing). The Newark company, I think, do so as well.

Mr. PALMER. They send some of them out to the homes?
Mr. CORDES. I think so.

Mr. PALMER. Where they are worked upon by children-some of them?

Mr. CORDES. I do not know anything about that, Mr. Congressman, except our particular case. I could not tell you.

Mr. PALMER. Have you been a prosperous concern in the last 20 years?

Mr. CORDES. Why, fairly so.

Mr. PALMER. Have you made as much return on your capital as you feel you are entitled to?

Mr. CORDES. I think we have; yes. It has been decreasing right along.

Mr. PALMER. It has been decreasing?

Mr. CORDES. Yes; a little bit; not a great deal.

Mr. PALMER. Has your product increased or decreased?

Mr. CORDES. The product has increased a little. The cost of manufacturing has increased; labor is higher and materials are higher.

Mr. PALMER. Well, what are you asking for here? The retention of the present duty?

Mr. CORDES. Yes.

Mr. PALMER. You want the same duty to remain?

Mr. CORDES. Yes. Why, we think the brush industry, as an industry, is not protected under the present circumstances. We think the duty should be 50 per cent.

Mr. PALMER. You want it raised?

Mr. CORDES. Yes.

Mr. PALMER. What do you want to accomplish by that?

Mr. CORDES. Well, I think if we could have the duty raised to equalize the difference in the cost of labor between Japan and this country it would help us a great deal.