Mr. Chairman, I appreciate the committee permitting me to appear to urge your favorable consideration and report on S. 1285. This bill, vital to the national security, if we are to have faith in the judgment of Dr. Wernher von Braun, is a measure of bipartisan support seldom accorded any proposal before the Congress.

One of the sponsors is the distinguished minority leader, Mr. Dirksen of Illinois. Another is the distinguished chairman of this committee, my able colleague from Montana. Another is the distinguished Senator from Colorado, Mr. Allott, a member of this committee. Still another is another from Kentucky, Mr. Morton, whose name is being prominently mentioned as the next chairman of the Republican National Committee.

I wish to add I am, too, a cosponsor and Montana is one of the leading States in the Nation in the production of fluorspar when our domestic mines are operating. Today in Montana the fluorspar industry is closed down tight, and some 350 fluorspar miners are out of work. The national security not only is to a degree threatened by this shutdown of the industry in Montana and other States, but in addition, the economy of the State is seriously affected.

In reading the provisions of the bill, I looked for possible flaws in it that might engender opposition, but was unable to find anything upon which it would appear to me reasonable opposition could be based. The barter provision protects completely the interest of the foreign producer who, in the past, has been supplying most of our fluorspar needs, and operation of the bill will result in reducing our tremendous stocks of surplus agricultural products.

An American industry now closed down except for the operation of one or possibly two captive mines will go back into production, giving employment to miners who have been on the relief rolls since January 1 of this year if S. 1285 is enacted into law.

The rights and interests of the consumer will be enhanced through assurance of stability of production and prices. The approach to the fluorspar problem as contained in S. 1285 closely approximates, as my distinguished colleague, the chairman of the House Committee on Interior and Insular Affairs, has already stated, in many ways the National Sugar Act which has operated so successfully throughout the years.

The approach in general is in line with the administration's oil import quota proclamation, and its lead and zinc import quota proclamation, both of which were patriotically designed and are working in the interest of national security.

Mr. Chairman, I assure you and the committee that I shall use all my best efforts to help bring about prompt floor consideration of this important bill when and if it is reported out of this committee.

The CHAIRMAN. Thank you, Senator Mansfield, for your very excellent statement. I am sure it will be helpful to the committee when we come to consider the bill and we will rely on you to cooperate with us during the course of its study.

Senator MANSFIELD. I will do my best.

The CHAIRMAN. I would like to ask if Senator Allott would make any comments.

STATEMENT OF HON. GORDON ALLOTT, A U.S. SENATOR FROM THE STATE OF COLORADO

Senator ALLOTT. Yes. Before the distinguished Assistant Majority Leader leaves the room I would like to express to him my appreciation for the fine statement he has just made and also for his support of this legislation.

His interest in the mining industry of this country is well known and I cannot recall one time in the last few years when issues of this nature have come upon the floor of the Senate that he has not avidly supported the miner's cause.

I think, along with the chairman of this committee, he can be named as one of the people who has most avidly fought for the rights of the mining industry of this country.

Senator MANSFIELD. I wish to thank the distinguished Senator from Colorado and to assure him as a former mucker and miner, we have a fight in the basic interests of a well-rounded domestic mining industry.

The CHAIRMAN. Thank you. I wish to join my colleague in complimenting the Senator from Colorado for his statement and assure him we will work hard to accomplish what is sought by this legislation.

Senator ALLOTT. Thank you, Mr. Chairman.

I am pleased to be able to present my views on S. 1285 to this distinguished committee. I should like to compliment the chairman upon his action in scheduling this early hearing as soon, I believe, as was possible after allowing time for agency reports. I know that you, Mr. Chairman, along with the other members of this committee, share my concern for the well-being of our domestic mining industry.

Certainly the precedent for this legislation, as contained in the legislation for sugar, has worked well. Although this legislation differs in some respects from the legislation for sugar, without which we would probably not have a domestic sugar industry, the principle of sharing our domestic market with our foreign friends is the basis for both the Sugar Act and this bill.

Foreign trade, as we know all too well, cannot be a one-way street. Our domestic consuming industries must be assured of an adequate supply of raw materials at reasonable prices if we are to meet the needs of our ultimate consumers both here and abroad. By the same token, our foreign customers must be able to sell in our markets some of their products if they are to remain customers of our manufacturing industries.

I think, Mr. Chairman, this is too often forgotten. This is certainly a two-way street.

In the minerals field we are not, with possibly one exceptionmolybdenum—an exporting Nation. Our national demands for minerals are such that if a reasonable price structure on minerals is to be maintained we must have imports of minerals. We cannot supply at reasonable prices all of our domestic requirements for minerals from domestic sources.

For emergency purposes we have obtained a stockpile of critical and strategic minerals and materials, but the question of national security from the standpoint of availability of minerals is not the primary purpose of the legislation presently under consideration by this committee. That problem, I hope, has been met.

The primary purpose of the legislation under consideration, as I visualize it, is to determine whether it is possible to find a formula which might be adapted to other minerals, that will permit a sharing of our domestic minerals market between domestic fluorspar producers and the producers of fluorspar abroad, one which will permit an orderly development of our own fluorspar industry and at the same time permit our foreign friends to expand their production at a somewhat higher rate than our own and, keeping in mind at all times the necessity for maintaining a stable price structure for the domestic consuming fluorspar industries.

For a number of years there has been a growing need for legislation to provide for a national minerals policy. This need has been recognized by the present administration, as well as past administrations. The need is even more essential now, particularly if we are to maintain a domestic minerals industry.

Within the framework of authority which the Congress has delegated to the executive branch of the Government there is not sufficient authority given to the Tariff Commission or the Office of Civil and Defense Mobilization to treat with the whole aspect of the problem. Each is restricted, and perhaps properly so, in its powers.

Only the Congress, in my opinion, can properly consider the broad problem and provide an equitable solution. Incidentally, I believe it is important that Congress establish, in general terms, the policy that we need, and intend to protect, a healthy mining industry.

My bill, S. 1537, would do that and I hope this committee will soon take up that bill, also. Within that framework, specific action programs like this one for fluorspar would be a great deal more meaningful.

If I may digress for just a moment, Mr. Chairman, I know that the Chair is fully aware of my own thoughts on this matter. Within S. 1537, which I am sure the committee will consider this spring, if such a bill is passed and we do declare by Congress that it is the intent of the Congress to maintain an economic and stable mining industry, then not only this particular piece of legislation, but other pieces of legislation implementing that will be much more meaningful in the future, and we will be providing a guidepost for the direction in which we hope to proceed.

Fluorspar was selected because certain factors were present in the fluorspar industry which made it more adaptable perhaps to the formula provided in S. 1285 that could be found in any other domestic mineral industry. To begin with, it is a small industry. The total value of domestically produced fluorspar and imports in 1957 was approximately $25 million. The relationship of the price of fluorspar to the end products such as steel, aluminum, freon gas, atomic energy, et cetera, is significant.

Yet is it absolutely essential. The principal consuming nation is our country. We can produce more than half of our domestic requirements; in fact, during the past two wars we produced the greater

portion of our requirements. Only a small number of foreign countries produce fluorspar and each of those have but a small number of producers. Consumption of fluorspar is increasing in this country at an extremely rapid rate and every measure we use indicates that this rate of increase in consumption will accelerate rapidly.

With those basic factors in mind it is now necessary to consider this table of domestic production, imports, and consumption for the years 1950-57:

In view of the foregoing table, it is surely apparent that with the cessation of Government purchases of fluorspar, via Public Law 733, which expired on December 31, 1958, for acid-grade fluorspar and defense stockpile purchases of metallurgical-grade fluorspar which ceased at the same time, the foreign producers can handily supply our domestic fluorspar requirements.

This is even more apparent when you consider that the figures for 1958 provided by Robert B. McDougal, commodity specialist, U.S. Bureau of Mines, indicate that 390,000 tons of imported fluorspar was valued at $9,750,000 while 322,000 tons of domestically produced fluorspar was valued at $15,800,000. Obviously, from a price standpoint, the domestic producers are in a position where they must succumb to import competition unless remedial legislation is provided. What then is the solution to this problem? Shall we permit the sacrifice of the domestic fluorspar industry in order to provide markets for foreign fluorspar? I cannot believe that is an appropriate solution. I might say I cannot believe it is an appropriate solution even in view of the stockpiling that we had under Public Law 733.

Neither do I think that anyone would propose an embargo on imports of fluorspar; that, too, would be unthinkable. Should we again send them to the Tariff Commission, where they have been twice, and were refused admittance a third time, but where they could only receive a recommendation for an increase in tariff?

Such a recommendation, taken to the maximum, would be ineffective, as would a quota or a combination of both tariffs and quotas applicable only to acid-grade fluorspar. Metallurgical-grade fluorspar, though destroyed as an industry, first is not eligible for an escape-clause investigation because there has been no reduction in the statutory rate of duty as there has been on acid-grade fluorspar.

Furthermore, such permissible recommendations would impose hardship abroad which should, I feel, be avoided if at all possible. Furthermore, no consumer protection could be recommended by the Tariff Commission. What then do we do?

I feel that we should, as proposed in S. 1285, seek a solution that will permit a reasonable amount of domestic production of fluorspar. Last year the Secretary of the Interior proposed to support domestic production at a level of 185,000 tons per year of acid-grade fluorspar.

The domestic industry protests that this is a little short and I am inclined to agree.

The 200,000 tons provided in S. 1285 is not unreasonable. The Secretary advised that metallurgical-grade fluorspar production at the then rate of 126,000 tons per year was at a satisfactory level. As I recall it, the domestic industry raised no objection to that figure.

Furthermore, I am quite certain that the production figures for both grades of fluorspar from domestic sources had been determined by the Secretary of the Interior to be sufficient to meet the requirements of the mobilization base.

Notwithstanding this, we must look to the foreign producer. For the most part, mill capacity, which is the determining factor in fluorspar production, has been financed abroad either directly or indirectly by the U.S. Government. Perhaps the request to expand and the assistance to make it possible came too early. I do not propose to make that an issue. It happened.

Now, what is the best way to minimize the effect of that action on the domestic fluorspar producer? In S. 1285 I propose that we take the most favorable 3 years for foreign producers and average the imports for those years which are 1956, 1957 and 1958. We then deduct the permissible imports under S. 1285 and direct Commodity Credit Corporation to absorb the surplus, if there be any, by barter. At the same time we give the foreign producer 75 percent of each year's increase in consumption of fluorspar by domestic consumers until barter becomes unnecessary. Thereafter, the foreign producer of fluorspar receives 60 percent of each year's increase in domestic consumption of fluorspar.

Consequently, through the action of S. 1285, we have created no injury abroad, no necessity or justification for our foreign friends to demand compensatory reductions in other tariffs before GATT, as they could, in the event of a Tariff Commission or OCDM unilateral

action.

So finally we reach the problem of the consumer, usually thought of and referred to in terms of the buyer. But here we have more than just a problem of protection on prices for the ultimate consumer or buyer.

I have already pointed out that in particular fields and areas in which fluorspar is used, it is a relatively insignificant part of the total product.

We have also to be absolutely certain that there is at all times available to the initial consumer of fluorspar, the manufacturer, an adequate supply of fluorspar at a reasonable price. If we failed in this, the results of our proposed action could be disastrous-considering the multitude of major industries completely dependent upon fluorspar.

How then has this contingency been met-both as to the adequacy of supply of fluorspar and reasonableness of price?

First, as to supply. We have in S. 1285 authorized the Secretary of the Interior to increase the permissible amounts of fluorspar to be imported at any time-not just on an annual basis-if it is needed by consumers. I cannot conceive of any reason why, considering the discretion given the Secretary of the Interior to make rules and regulations for the implementation of this bill, that there should ever be a shortage of fluorspar.