Mr. HARDY. Yes; I am familiar with the McKenna Metal Co. Senator MALONE. Are you familiar with the position that he took in the House in his testimony?

Mr. HARDY. Yes; I am.

Senator MALONE. In other words, he did not want a bonus for his production. He had shut down his mine when he could get the metal cheaper from a foreign source than he could produce. Then he did not want a tariff or a bonus. But when it went above that price of the foreign nation, he operated his mine.

You are familiar with all this business; are you not?

Mr. HARDY. Yes, sir.

As I recall, Mr. McKenna opposed the additional purchases to the stockpile on the basis that the stockpile levels were too high. I believe, in substance, that was his testimony.

Senator MALONE. The facts are that he was buying his metal at a foreign price and was selling his metal to the stockpile as long as he produced when the Malone-Aspinall Act was in operation.

Mr. HARDY. Apparently the economics of the situation favored that. Senator MALONE. Do you not think that the same economics will apply if you go into a program that is practically the same, in effect? Mr. HARDY. I do not follow your reasoning on that, sir.

Senator MALONE. What difference do you think there would be in appropriating money for a bonus to keep our own people in production and in a fixed price for a stockpile? What difference do you think there is in principle?

Mr. HARDY. I envision quite a difference in the principle. In the case of the domestic stabilization plan, we are supporting a sale into commercial channels.

In the other instance that you have pointed out, it was purely a purchase type of program.

Senator MALONE. It is necessary to make the sale before they could collect the difference?

Mr. HARDY. That is right.

Senator MALONE. Now I will ask you the question, since it seems you will answer here: Suppose it is offered to the consumer-any of these metals and the world price is whatever it happens to be at the time; do you think that consumer have the gumption to see if they would lower their foreign price before he made the domestic purchase?

Mr. HARDY. Senator, I think, historically the commerce of metals. follows well-established and defined patterns, such as the normal quoted price and things like that. I think those are the procedures that would govern.

Senator MALONE. I would merely call your attention that for 24 years we have been juggling this thing around under a free-trade basis and none of those principles have governed. I do not think you have any idea that they have. That is the reason you are trying to get a new formula, and the new formula, in my opinion-and I want to go on record now—will not work any better than the other.

The reason I am going to join in this bill is because you have recognized publicly that in order to keep a domestic industry going-note, I say a domestic industry-that industry has to have in some manner the difference of the world cost of production and the world price and the domestic cost made up through either a bonus or payment of some kind, a fixed price or a tariff. You have recognized that principle.

I do not expect you to answer what you would like to have done on these minerals. But there are 5,000 other products that are in the same position, machine tools, and so on, and they are going out of business.

Now, are you familiar with a bill or the principle that the State Department has advocated continually and may pass someday, that the taxpayers would put up the money to retrain workingmen for another industry that was put out of business through the imports of lower cost products.

Mr. HARDY. I am not familiar with such legislation.
Senator MALONE. Would you mind looking it up?

Mr. HARDY. I Would be happy to, sir.

Senator MALONE. It has been before Congress now ever since you have been here. I think it is going to be necessary to pass it if we keep this up.

How many minerals are there in your bill?

Mr. HARDY. There are five minerals included in the stabilization plan.

Senator MALONE. That does not include copper?

Mr. HARDY. That includes copper.

Senator MALONE. Then would you mind computing for the record the difference in the cost of the end product, say like tungsten or lead or zinc or columbium-tantalum, fluorspar, that your bonus plan would make in the end product? In other words, if your bonus is $18 on lead or whatever it is-maybe on tungsten, I am not trying to quote any one of them particularly-whatever you make up in each case, would you prepare a table that would show us in general the difference in cost of the end product of the metal that enters into the manufacture?

Mr. HARDY. I would be very happy to do that, Senator Malone. Senator MALONE. I think you will find it hard to define in the end product.

Now, I would like, Mr. Chairman, to introduce into the record, since we have talked about bauxite and aluminum for a little while, a table on the production and imports for consumption and percent, 1955-56, of aluminum metric tons.

Senator BIBLE. The table will be introduced at this point in the record.

NOTE.-Imports include: Metal and alloys, crude plates, sheets, bars, etc., scrap.

Senator MALONE. The same with bauxite, metric tons, production,
imports for domestic consumption, for 1955-56.

Senator BIBLE. This will likewise be made a part of the record.

Senator MALONE. I want to say that something has been said about Russia. We are making a report that I hope will be published this year. It is part of an Eastern Hemisphere report under a Senate resolution.

I visited some Russian plants where bauxite and aluminum and various raw materials are used. I am just about to say to you that if you think you are going to compete with the Russian price on anything, I think you are going to cost the taxpayers an awful lot of money. But you can protect the American market. Russia could not get here any more than anybody else if you took the profit out of the low-cost labor at the water's edge like article I, section 8, of the Constitution directs you to do. It gives the legislative branch the machinery to do it.

Then I think you have a chance to compete with anybody for your own market. Americans then would compete for their own market.

We had an Assistant Secretary of Interior in here that made the statement that he thought they had to maintain a plan long enough to determine who was going to be in business here. Under the plan that we always used for 150 years, competing for the American market, when it was saturated, if it ever was, then the less efficient went out of business naturally, did they not?

Mr. HARDY. That is right.

Senator MALONE. Is that not a pretty good system?

Mr. HARDY. That is one of the foundations of the free enterprise system, Senator.

Senator MALONE. Thank you.

Senator BIBLE. Thank you, Senator Malone.

Mr. Secretary, may I again thank you for your patience and the help you have given this committee, and likewise tell your very able

staff.

Senator MALONE. Will you include in the record here, too, the percentage distribution from the different countries?

Senator BIBLE. This table will be filed with the committee for reference purposes.

Senator MALONE. Before recessing, may I join in congratulating the Secretary. He is the first one that broke through the White House barrier and figureed out that you had to have a tariff or bonus to stay in business in this country.

Senator BIBLE. The meeting and hearing will be in room 224, at 10 o'clock tomorrow morning.

(Thereupon, at 1 p. m., the committee recessed, to reconvene at 10 a. m., Friday, June 20, 1958, in room 224.)