Without our knowing it and without the industry in any way at all being notified, industrial diamonds were taken off the list in October before most of these purchases were made by the industrial diamond industry. We were not notified and didn't know anything about it until January. The result was that there is now in the hands of the industrial diamond industry some $25 million to $30 million worth of industrial diamonds. ODM said that bort, crushing bort which is one of the things that industrial diamond importers handle, is in terribly short supply. All of the industries in the country are crying for bort at this time. We cannot get the bort. The reason we cannot get it is because you cannot buy bort from the English syndicate unless at the same time you buy toolstones, which are the other industrial diamonds, and we cannot buy toolstones because now we have an oversupply of toolstones because the Government, without letting us know, shut down on the industrial diamond bartering. Thank you, gentlemen. The CHAIRMAN. Mr. Sverdlik. STATEMENT OF IRVING SVERDLIK, SECRETARY, CALABRIAN CO., INC. Mr. SVERDLIK. I am Irving Sverdlik, secretary-treasurer of the Calabrian Co. We were privileged to testify before the subcommittee of this committee about 2 weeks ago. We wish to associate ourselves with and endorse the comments of Mr. Chambers with respect to the testimony here today and to this barter program. We have placed a statement in the record of the subcommittee here and we are sure that all of the information submitted is available to this full committee. We would like possibly about 4 or 5 minutes to make a few brief additional comments. We are most impressed by the fact that the grain trade rather unanimously, which appeared before the various committees investigating this subject, seems to believe and state, first, that net exports are increased by the barter program as it has been operating, which is directly contrary to Mr. Berger's testimony as I understand it. Secondly, the grain trade apparently is unable to participate in the program as described by the revised press release of May 28, 1957. We have had the experience of looking into potential new barter transactions and have found it impossible. We find it impossible because the grain exporters, and as I understand it there are about six of them who do most of the substantial grain exporting out of the United States, seem unable to take the risk and to designate in advance substantially what item of agricultural produce they must export in substantial quantities in the future designating a country in advance of any known business for that commodity in that country. We are told repeatedly by the grain people that they just can't do that. They cannot put their necks out in effect on a few million dollars worth of a certain commodity to go to a certain country within a certain period. That is what, as we understand the regulations, they now require. We would like to mention in passing, with respect to one reference which I believe Mr. Simpson made to the complexity of dealing in barter with the Department of Agriculture now-it is true the contracts have been complex. However, a billion dollars worth of business has been done and we have found it is possible to work with the barter and stockpiling divisions in working on quite a few of those contracts. On the other hand, the Government, in attempting to negotiate so-called direct barter, which is a government-to-government transaction rather than a normal trade channel transaction, seems to have run into insuperable difficulties. We understand they have been able to complete three over the course of many years. We think that this experience indicates that the program as it has worked in the past several years has been far more effective and sound and in the interest of the country than any revision in the nature of direct barter which is an extremely difficult and rare transaction and does not operate through normal business channels but operates on a government-to-government basis essentially. We also would like to state we do not feel the interest factor is a major issue. We think it is in the interest of the Government. If the Government feels the interest factor should be reduced or modified we raise no substantial objection to it here. Thank you very much. The CHAIRMAN. Do you have a statement? Mr. CHARLES COGLIANDRO. No, sir. Mr. Chambers and Mr. Sverdlik said everything I wanted to say. I do want to say this, though, Mr. Chairman: Agriculture here. seems to want to reduce this complex business, which is a foreign business, to simple formulas, and it just won't work. Foreign business is very intricate. When we talk of cash sales we are not talking of cash sales but we are talking about exchanging goods, and as Mr. Poage said we are essentially bartering from country to country, and this is where this has to work. The CHAIRMAN. Thank you very much for your statements, gentlemen. We appreciate your interest. The HOUSE is in session so the committee will stand adjourned subject to call. (The committee adjourned at 12:10 p. m.) X JURISDICTION OF PACKERS AND STOCKYARDS ACT HEARINGS BEFORE THE COMMITTEE ON AGRICULTURE HOUSE OF REPRESENTATIVES EIGHTY-FIFTH CONGRESS FIRST SESSION ON H. R. 7743 and H. R. 8536 JULY 9, 10, 11, 12, 15, 31, AND AUGUST 1, 1957 Printed for the use of the Committee on Agriculture Serial FF UNITED STATES WASHINGTON: 1957 |