Senator MANSFIELD. That is all, Mr. Chairman. Senator HICKENLOOPER. Mr. Carl F. Oechsle, Deputy Assistant STATEMENT OF CARL F. OECHSLE, DEPUTY ASSISTANT SECRETARY FOR DOMESTIC AFFAIRS, DEPARTMENT OF COMMERCE, ACCOMPANIED BY NATHAN OSTROFF, ASSISTANT GENERAL COUNSEL. DEPARTMENT OF COMMERCE Mr. OECHSLE. Mr. Chairman and members of the committee, I appreciate very much your invitation to state the views of the Department of Commerce on the Universal Copyright Convention and S. 2559, a bill which would amend our copyright laws in conformity with it, both of which we recommend for your favorable consideration. Other witnesses from the executive branch of the Government and from industry and the copyright bar are better able than I am to explain the technical deficiencies in the present situation of American literary, musical, and artistic property abroad, and also to give you the important political, social, and moral reasons justifying the changes here proposed. I should like, therefore, to confine my brief remarks to the economic and commercial considerations involved. ECONOMIC AND COMMERCIAL CONSIDERATIONS While the primary economic interest in obtaining effective international copyright protection would seem to be that of the creative individual himself, economic and commercial benefits also are derived therefrom by the owners and employees in the industries which produce and distribute their work-such as book, magazine, and music publishing, and radio, television, and motion pictures. All of these professions and industries will benefit commercially by the adoption of this convention and the enactment of this implementing legislation. There is a large actual and potential market abroad for literary, musical, and artistic property of American authors and composers. While we now enjoy a relatively large volume of such business, it rests on an unsteady, if not flimsy, base for lack of United States participation in a satisfactory international system of copyright protection which the convention would provide. I have had prepared, for your information, as an attachment to this statement, complete statistical data on exports and imports of English-language books and printed matter for the past 4 years. There is also attached a statement relating to income received from the rental of American motion pictures abroad. I call to your attention, particularly, that the interest in exports alone includes almost $25 million annually of book exports, an equally large amount of exports of periodicals, and almost $200 million of rental income from foreign showings of American motion pictures. There are no official data with respect to royalties earned from the performance abroad of American-copyrighted music, or the sale of performance and reproduction rights of American-copyrighted books and plays. However, unofficial trade estimates with regard to these items are that they amount to about $5 million annually. BOOK EXPORTS NOW EXCEED IMPORTS Our situation in this respect was quite different at the time of the enactment of the so-called manufacturing clause in our copyright law as a protective device for our domestic industry. We were then importing about twice as much as we exported of printed books, and such imports were quite substantial in relation to the productive capacity of our then infant printing and publishing industries. Since then, the industry has grown tremendously, as have also exports and imports of its products. But exports of books now far exceed imports, and imports represent only about 2 percent by value of domestic production. This is also no longer an infant industry-it now ranks eighth, in value of output, among the 21 manufacturing industries. There is, moreover, considerable apprehension in the American publishing industry that unless there is more effective reciprocity on copyright, United States authors and publishers might well lose even the slight international protection they now have. In such event, the loss to the American printing and binding industries would be very substantial, since the foreign market for books and magazines produced in this country would not only be curtailed, but a large volume of printing now done here might well be transferred abroad. SUPPORT FOR CONVENTION AND LEGISLATION The proposed copyright convention and this bill, which is necessary and intended to implement it, have the support not only of the book, music, and magazine publishers, but also of radio, television, and motion-picture interests, as well as of individual, and groups of, authors, playwrights, songwriters, composers, and artists. In addition, the house of delegates of the American Bar Association recently took favorable action on this subject. And, of particular significance is the fact that the Book Manufacturers' Institute has withdrawn its earlier opposition to these proposals. BASIS OF OPPOSITION TO LEGISLATION We are not unaware of the opposite views of certain printingtrades unions and of some segments of the printing industry. They fear possibly increased competition of foreign book imports as a result of the one substantive change in our copyright law that is here involved-the modification of the manufacturing clause. Under present law, a foreign author writing a book in the English language must print and bind it, that is, manufacture it in the United States in order to obtain the complete protection of our law. It is obvious that if such provisions were contained in the laws of other countries, the loss to the United States would be very great, since as I have pointed out we are a far greater exporter than importer of printed works in the English language. S. 2559 would modify our copyright law so as to preserve the manufacturing requirement for all works written by our own citizens, which of course is no unreasonable burden, but to relieve foreign authors of nations signing the convention from such requirement. We believe there is little, if any, possibility of this change resulting in harmful competition; and that it would certainly be more than offset by the benefits from increased exports. ADVANTAGES OF BOOK MANUFACTURING IN UNITED STATES It should be noted in this connection that several factors operate to make book manufacturing more advantageous and profitable in this country than abroad in spite of wage differentials. For the large editions normally required for the American market, our mass methods make the cost of production comparable or lower than in the United Kingdom and Canada, the other two principal countries publishing in English. Even with the manufacturing requirement removed, most foreignauthored books for general sale in this country are likely to be produced here for reasons of economy and such other reasons as closeness to source of supply, minimum shipping delays, and avoidance of other items of expense, such as insurance and tariffs. There is also for consideration the advantage to be derived from the close association of domestic publishers with the channels of book distribution. One of the large publishers of magazines and books advises us that the number of books which would come into the country as a result of the changes here proposed would be a mere trickle and would offer insignificant competition to books published and manufactured here. Only about 1 percent of the books now manufactured would be even potentially affected. And book printing is itself only a tiny fraction of all printing. But even this tiny percentage of printing would not necessarily be affected. Nothing in the present manufacturing clause requires older books not under copyright, or plays, music, and books in other languages to be printed here. Yet such works sold here are nearly all printed here, simply because it is often cheaper and always more convenient and efficient. Almost certainly the copies sold in the United States of popular current foreign books in English would continue to be printed here for exactly the same reason. To sum up-we believe this convention and the necessary implementing legislation will not injure anyone-and will benefit our creative citizens and the industries and their employees who reproduce their works, by strengthening our growing foreign markets for literary, musical and artistic products. We, therefore, commend them to you. (The tables above referred to are as follows:) United States imports and exports of English-language books and total printed 1 Data cover selected books, including pamphlets and music in books and sheets, printed in English language as designated in schedule A statistical classification of imports; they exclude books printed wholly or chiefly in languages other than English, bocks imported for use of the U. S. Government, Bibles and testaments and prayer books. 2 Data cover books, including text books, dictionaries, yearbooks, and other books as designated in schedule B statistical classification of exports; they exclude Bibles and Testaments, and music in books and sheets. Source: Prepared by Economic Analysis Division, Bureau of Foreign Commerce, from basic data of the Bureau of Census, Department of Commerce. Source: Balance of Payments Division, Office of Business Economics, Department of Commerce. Senator HICKENLOOPER. Thank you very much, Mr. Oechsle. You ran under your time by a minute and a half, and I am very grateful. Senator FULBRIGHT. I have one question. Senator HICKENLOOPER. Senator Fulbright. IMPORT AND EXPORT FIGURE Senator FULBRIGHT. The figures in your table indicate a larger disparity between exports and imports than I thought. It is $81 million in exports of printed material as against $19 million. We have been told there were $25 million of exports. Did you mean just the book figures? Mr. OECHSLE. Just the book figures. Senator FULBRIGHT. What does the rest consist of? Mr. OECHSLE. Periodicals, printed matter. Senator FULBRIGHT. This is the material in which the printers should be interested. Mr. OECHSLE. That is right. Senator FULBRIGHT. This gives a little clearer picture of the relative. value of the exports and imports in which the unions should be interested. Mr. OECHSLE. Absolutely. Senator FULBRIGHT. So the overall figure is $81 million in exports, in round numbers, against $19 million in imports of printed matter; is that correct? Mr. OECHSLE. That is correct-for 1953. Senator FULBRIGHT. So, it is far more than 2 to 1. IMPORTATION OF FOREIGN FILMS Senator FULBRIGHT. The other question I wanted to ask you on your second table. Can you explain why the United States payments between 1951 and 1952 were more than half? What did we do to exclude foreign motion pictures? Did we put an embargo on them? Mr. OSTROFF. We are not entirely sure, but we would assume that just less movies were produced in that period. Senator FULBRIGHT. It is a very dramatic change, from $11 million in 1951 to $4 million in 1952. Mr. OSTROFF. It might have very well been that some of the movies were left over from the war period and were still coming in. Senator FULBRIGHT. During that same period our exports increased from $160 million to $167 million. Mr. OSTROFF. They have been increasing, because the dollar situation has been improving abroad. Senator FULBRIGHT. What I wonder is whether this very dramatic decrease in movie imports into the United States was due to an embargo by our movie houses. I understand most of our movie houses would not permit a foreign film to be shown. Mr. OECHSLE. I don't know. It is possible that someone else may be able to answer that later. Senator HICKENLOOPER. Senator Mansfield, do you have any questions? TARIFFS ON IMPORTS AND EXPORTS Senator MANSFIELD. Just one question. Is there a tariff on books, films, music, and plays? Mr. OECHSLE. Yes, there is. Senator MANSFIELD. Could you give the committee the figures showing the extent of that tariff? Mr. OECHSLE. We will be glad to present them to you. Senator MANSFIELD. And other related printed material? Mr. OECHSLE. Yes, sir. Senator FULBRIGHT. Can you indicate approximately what it is? Mr. OSTROFF. Ten percent ad valorem. Senator HICKENLOOPER. Do other countries have tariffs on the imports of our books? Mr. OSTROFF. We would have to check that. I do not know. Senator HICKENLOOPER. If you can, give us the information on the comparative tariffs of other countries that affect our country? Thank you very much. |