The monthly hours from which these rates were derived were generally in the range of 230 to 250 hours. If the monthly rates as shown in the preceding paragraph are reduced to hourly rates, their low level becomes glaringly obvious. An $80 per month rate drops to the low level of 34 cents if converted to an hourly rate, assuming the number of hours worked per month was 230 or some 53 hours per week. If 250 hours are used as a base, the hourly rate drops to 32 cents. (Source: Monthly Bulletin of Labor Statistics, June 1974. Executive Yuan, China). Additional compensation in all manufacturing (including printing) is estimated to be 15-20% in Taiwan. This addition would, however, not affect the differential between U.S. and Taiwanese wages significantly. Korean wages are reported on a monthly basis, based on "regular employees." In printing and publishing the rate is shown as $74.90 per month for 1973. The number of days worked averaged 25.3 per month. The daily average rate was therefore $2.96, or about 33 cents per hour. By 1975 the pay had risen to $105 per month or $4.32 per day. This would represent some 48 cents per hour. (Source Monthly Statistics of Korea, June 1975, Economic Planning Board, Korea.) The conversion from the Korean won has been made at the rate of 398 won per $1 U.S. for 1973. The report states that an addition from 25-30 percent should be made to the wage rates as reported. However, such an adjustment would still leave the hourly rate of 1973 which was calculated at 33 cents no higher than about 42 cents. The 1975 rate would be lifted to about 61 cents per hour. The areas of such low wages are potential sources for the development of book-printing at low cost. Books so printed could enjoy copyright protection in this country under Universal Copyright Convention. The maintenance of the conditions now in effect in the form of the Manufacturing Clause, assuring manufacture in this country as a condition precedent to the enjoyment of a monopoly in this market, is both legally justified and fair as a quid pro quo to enjoyment of our market, particularly since the duty on imports has already been removed. European wages in the printing trades, though varying substantially among some of the countries, are well above those prevailing in the Far East and Mexico. France and Britain are on the low side. According to the publication, "International Graphic Federation Journal," the standard rates of pay per week for skilled labor in the printing trades were at the level of $62-$64 in Britain, for typographers, lithographers and gravure printers, in 1974. Conversion was at $2.36 to the £. The French rates ranged from $83 to $89, while bookbinders and packagers were at the lower level of $55 per week. The American rate for bookbinders was $150 while the rate for lithographers was $212 and that of gravure printers was $269. Both West Germany and Belgium had higher weekly rates. The Belgian rates ranged from $103 for packaging and $120 for bookbinding to $140 for newspaper offices. From 9% to 14% should be added. Typographers, for example, at $124 received an additional 12% bringing them to about $140. West German rates ranged from $126, average for all trades, to $142 for machine compositors, the highest. Bookbinders, in the highest age and wage group were paid $122. The highest European wages in the printing trades were paid in Norway, Sweden and Switzerland. The Norwegian rates ranged from $143 per week for packaging to $191 for lithographers. The Swedish rates ranged from $119 for bookbinders and packaging to $176 for skilled typographers. Lithographers and gravure printers received $175. The Swiss rates ranged from $169 for packaging to $212 for machine compositors. American rates, however, were still above even the Swiss rates, the highest in Europe, in some of the trades. While some European countries are much nearer to our level of wages than those of the Far East, they nevertheless still leave a considerable gap. What applies to the Far East and Mexico is therefore also applicable to Europe with respect to retention of the Manufacturing Clause, albeit with somewhat lesser force. Mr. KASTENMEIER. Our next witness is Mr. Gerhard Van Arkel, general counsel, International Typographical Union. Mr. Van Arkel has an extensive statement with materials appended to it, which will be received and accepted and printed in full in the record. [The statement of Gerhard Van Arkel follows:] BEFORE THE HOUSE JUDICIARY COMMITTEE; SUBCOMMITTEE ON COPYRIGHT I have previously testified before this Subcommittee. I have re-read my earlier testimony and statement on the subject of the manufacturing clause, and believe that no major changes or additions are required. I have therefore taken the liberty of resubmitting my earlier testimony and statement as my statement to the Subcommittee on this series of hearings. Respectfully, GERHARD P. VAN ARKEL, COPYRIGHT LAW REVISION HOUSE OF REPRESENTATIVES, SUBCOMMITTEE No. 3 OF THE STATEMENT OF GERHARD VAN ARKEL, GENERAL COUNSEL, INTERNATIONAL TYPOGRAPHICAL UNION, ACCOMPANIED BY JOE BAILEY, VICE PRESIDENT, INTERNATIONAL TYPOGRAPHICAL UNION Mr. VAN ARKEL. Mr. Chairman and members of the committee, my name is Gerhard Van Arkel, of the firm of Van Arkel & Kaiser, Washington, D.C. I represent here the International Typographical Union, AFL-CIO, which has long been interested in this subject matter, in support of the Register's recommendation that a manufacturing clause be continued in our copyright law. With me is Mr. Joe Bailey, a vice president of the International Typographical Union, who does not plan to testify but who will be available to answer any questions which the subcommittee may wish to put to him. I have submitted to the committee a statement setting forth our position on the issues which are involved in this matter. I shall try to summarize, in my presentation here, and I shall try to do it somewhat more briefly than Mr. Frase did yesterday on behalf of the publishers. I hope the members of the committee will understand that I do this out of respect for the time pressures that I know are on this committee, and not because I could not, if I chose, talk as long as Mr. Frase or because we are less interested in this subject matter than he is. I would strongly urge that in considering this problem the thought that should be uppermost in your minds is that we are not talking about free trade. Insofar as the American market today is concerned, there is free trade in books. There is a purely nominal tariff of 3 or 7 percent only. There is no other restriction of any kind imposed by statute, regulation, or otherwise which restricts, in any respect, the number of books that any person, or the type of book which any person, American or foreign, can import into the United States. We have thus absolutely free trade in books. You gentlemen have been considering amending the copyright law, and witness after witness who has appeared before your committee has stressed the obvious fact that the grant of a copyright is the grant of a monopoly. Now I do not have to develop the thesis that monopoly and free trade are at the opposite ends of the pole, and that they are not reconcilable. Our position here is that foreign manufacturers should have the right, which they now have, to have their work performed anywhere in the world by that labor which is most exploited and works under the most degraded conditions, and to import that product into this country without restriction. As I say, that right they now enjoy. Or that they can by American law exclude American manufacturers from the American domestic market under certain reasonable conditions. But we object to their being granted both this unlimited right of importation and an unlimited monopoly of the American market at the end of it. I suggest to the committee that there are only two questions properly before you. The first is, may the Congress impose reasonable conditions on the grant of copyright? The second is, is the manufacturing clause a reasonable condition? Now the first of those need not detain us. Your whole hearings have been directed to the question what kind of conditions should be imposed on the grant of copyright. Who may have a copyright, what does the copyright extend to, who is the infringer, and all the rest of it. This we think is in line with the constitutional power granted to Congress in this field. Now as to the second question, whether or not the manufacturing clause is a reasonable requirement, about 15 years ago the Honorable Sam Bass Warner, who had been a Register of Copyrights and who was a stanch defender of the manufacturing clause, did a very perceptive study of this clause and its origins. He found that at its inception this clause was exactly what we assert it now to be. That is to say, at that time it was an entirely acceptable condition imposed on the grant of a very much desired privilege; namely, the right to have a monopoly of the American market. As he pointed out, this was the method that the Congress adopted to reconcile the interests of the British in obtaining copyright in the United States and the desire of the American public to have English editions under reasonable conditions. Prior to that time, as has been pointed out, there was no protection for foreign nationals in this country and there was no protection for American authors in England. The result was that English titles were pirated in this country generously and that American titles were pirated in Great Britain. A good bit of the coyness that was shown by the witnesses yesterday about the unethical practices, if I can call them that, of American publishers in pirating British titles was quite unnecessary because the British were doing exactly the same thing with our titles. So that the grant of copyright accompanied by the manufacturing clause was the method which the Congress and all other interests chose to impose as a condition on the grant of this very much desired privilege in the United States. It is, of course, difficult to compare wage rates in different countries. In my statement I have made an effort to do so. On page 4 Mr. Fuchs peints out that I neglected to say in the statement that the wage rates there referred to are wage rates of printing trade workers abroad. But those comparisons show that the country which most nearly approximates our wage rates, which is Sweden, has an average wage rate of less than half of ours. I should have mentioned Canada, whose rates are approximately equal to ours. The lowest of them, Belgian women, is only about a tenth of our wage rates. I have not been able to obtain statistics, but we know that wage rates in the Far East and in large parts of South America are below even these levels. So this points up the glaring discrepancies between wage rates abroad and in this country and it illustrates, I think, our basic point that we should not create a condition in which work can be done under the most degraded working conditions anywhere in the world and still have unlimited entry into the United States and a right to exclude American manufacturers from our domestic market as a consequence. Now we have made certain points in this statement which I should like to discuss briefly. In the first place, we would welcome a provision which would exempt Canada particularly from the manufacturing clause. This has a bearing on a good bit of the testimony that was given yesterday, where it was pointed out that there is a lot of friction with the Canadians, and we think that where wage rates are comparable, as they are between Canada and the United States, that there ought to be some provision made, we suggest by way of a Presidential finding, that if another country has wage rates comparable to ours then the provision of the manufacturing clause should not apply. This is particularly significant if you consider the export figures and import figures which Mr. Frase presented to you yesterday. Those figures show an excess of exports from the United States over imports, but about 45 percent of our exports go to Canada, and we import practically nothing from Canada. So that if you take the Canadian figures out of the statistics that Mr. Frase presented to you yesterday, they make a far less one-sided picture than the statistics which he produced would make it appear. By the same token, almost 40 percent of our imports are from Great Britain so that, insofar as Great Britain is concerned, there is hardly any inequality whatsoever. I would just like to add that our concern is not with fair competition. If wage rates are approximately equal in another country, we are confident that American manufacturers and American workers can get along with them. But we think that this is a desirable change to make with respect to the manufacturing clause. We are troubled by the proposal which the Register of Copyrights makes to increase the number of copies from 1,500 to 3,500 that may be imported into this country. This makes it necessary for me to go back into a little more history. The original Copyright Act of 1891, which granted for the first time copyright protection to foreigners in this country, was carried forward with some tightening up in the act of 1909. In 1949 those requirements were, we think, very generously lightened insofar as foreign interests are concerned. The number of books that might be imported was increased from 1 to 1,500. The length of time within which registration was required was increased from 60 days to 6 months, and the period of time in which publication in this country was required was increased from 6 months to 5 years. The unions at that time supported these amendments. They were based on the simple theory that this would enable the foreign manufacturers to test the American market in order to determine whether or not the publication of an American edition was feasible. Those we thought at the time were generous concessions to the interests of foreign manufacturers, and we still think that they were. Now I have not heard from any source any complaint that this number of 1,500 was inadequate for the purposes of testing the market. We recognize, however, that the market has grown. We, therefore, would not object to some modest increase. But the proposal to increase it substantially over 100 percent seems to us misguided, and we believe that no basis has been shown to justify that dramatic increase in the number of copies that might be imported. Now I would like to say a word about the problem of reproduction proofs which was gone into at some length here yesterday. For the members of the committee who were not here, I should state that this problem arises from the fact that in our interpretation the present law requires that in order to meet the conditions of the manufacturing clause, all the work has to be done in this country. Under new methods of printing which have been developed, it is now entirely feasible, however, to have type set abroad and, instead of importing type into the United States, to import into it what I shall call "reproduction proofs"though this covers a multitude of processes, including such things as computer tapes, paper reproductions, and so forth. Instead of importing the type, however, it is easy enough to put on a jet plane a small package containing the reproduction proofs of the type and to introduce them into this country. Now some publishers have taken the position that under present law this practice is lawful. We assert that it is not; that is to say, that loss of copyright follows from the adoption of this practice. We have not been able to bring this to a judicial determination because we have no standing to sue in court. The penalty that is involved, the loss of copyright, is not one that can be directed at us because we do not hold any copyright. We are confident, however, that the matter will be judicially resolved before too long. Mr. Frase yesterday objected that the Congress should not adopt this proposal because it is indefinite, because the Register of Copyright admits he does not know what the present statute means. But I put it to you that daily Congress adopts statutes of which they do not know the precise meaning. You adopt a statute saying that a utility must charge reasonable rates, that a certain transaction must take place in good faith, that a certain act must be done within a reasonable time. There is nothing new or different about the Congress leaving to the courts the job of interpreting statutory language, which is in substance what the Register of Copyrights proposes be done here. The mere fact that the language may have some ambiguities-we insist there is no ambiguity-that the present statute clearly outlaws this practice, we think this is no valid reason why the Congress should not leave this matter to later judicial determination, and we are confident what the outcome of such litigation would be. Now I shall only briefly mention the fact that, while we have our types of violent disagreement with the publishers, we do support their position on fair use. We think that the copyright law should not be repealed in effect by granting a right to any person to make as many copies by whatever means he chooses of a copyrighted work. If I could, I would like to make a few comments about the testimony you heard here yesterday. As I understood the thrust of the testimony yesterday, it was directed at two points. The first is that the repeal of the manufacturing clause would not make a bit of difference to anybody. We were told that British book manufacturers had said they didn't care whether it remained on the books or was repealed. We were told this could not affect the interests of the printing trades workers or the American manufacturers. In short, one was left with the impression that the committee was wasting its time in considering this subject matter because it made no difference to anybody. On the other hand, we were assured that the retention of the manufacturing clause was stifling scholarship, that it was crippling the publishing industry, that it was a horrendous offense against morals and against society. We were told that the publishers did not object practically, they merely objected in principle to the manufacturing clause. As Senator Jim Watson, of Indiana, used to be fond of saying, "There are times when every politician must rise above principle," and this is one case where the publishers have in fact risen above principle. I think they don't care any more about money than I do about my right eye. I think that quite clearly their effort is to have the opportunity to search around the world to find where the work can be done most cheaply and hence most profitably to them. But I think, of particular significance, Mr. Frase, in testifying for the book publishers, did a little boasting about how right he was in 1954 when he stated that the repeal of the manufacturing clause as to works produced by foreign authors in the English language would have no effect on the market, and he rather intimated that we were very stupid at that time in thinking that it might make a difference. He had a lot of statistics to prove how right he was and how wrong we were. Now I do not know whether you have copies of his statement, but if you will look at page 19, there appears there a table which shows the comparative volume of trade books in English, imported and manufactured in the United States in 1953, 1958, and 1964. If you will look at the column headed "Percent of total copies," the 1954 amendment applied, as I have stated, only to books in English of foreign authorship. If you look on the first line under "Imported," you will see that in 1953 the percentage is 1.8 percent. That in 1958 it was 3.5 percent, or just about 100 percent more. That in 1964 it was 4.8 percent. That is, in a period of less than 10 years there has been a 250-percent rise, approximately, in the number of books of foreign authorship in English imported into this country. I will leave it to the members of this committee to say whether or not a 250percent increase is or is not a dramatic increase and whether or not those figures support Mr. Frase's contention that the repeal of this clause in this respect would make no difference or whether they support our contention, made at that time, that it could and would have an economic impact. What I have not done, but perhaps some attention ought to be given to it, the percentage of books in English by foreign authors is, as these figures show, a relatively small percentage of the total books manufactured and imported into the United States. But if you take a rise of 250 percent in less than 10 years or of about 25 percent a year, extrapolate that over another 10 or 20 years, you will get to some really dramatic figures. And if you apply those same percentages, then, to the total book manufacturing industry in the United States which would, of course, be affected by the total repeal of the clause, then I think you will see some very dramatic impact indeed on the American book manufacturing industry. So that we insist that Mr. Frase's figures, far from supporting his assertion that the manufacturing clause will make no difference, are clearly belied by the figures that he himself has produced and that his accuracy as a prophet can be highly questioned in the light of the kind of testimony which he gave in 1954 which he repeated here yesterday. Now we were also told yesterday that we are stifling scholarship by asking for the retention of the manufacturing clause. Now, cross my heart and hope to die, I am not against scholarship, and neither is the ITU. We are all for it. You will recall in the testimony you have heard about the way in which publishers are stifling scholarship because of their insistence on fair use provisions in the copyright laws. That scholarship ought to be assisted by giving an unlimited right of copying. You have beard the publishers' anguished reply that they should not be asked to subsidize scholarship by giving them free books, that libraries and scholars and universities and so forth ought to pay the full price of their books. |