318 REPORT ON COOPERATION IN AMERICAN EXPORT TRADE.

neers. These foreign engineers naturally adopt certain standards, English
or German or French or Belgian, as the case might be, and when this is done
we have the alternative of either building according to their—Ii. e., European—
standards, which makes it prohibitive for us, or to refuse to build at all, and
zenerally we do not bid. It is only in cases where, like the present, foreign
ouilt or managed railways can not get locomotives elsewhere that they are
willing to accept our standard type of construction. * * *
We supply locomotives to practically all the Chinese railroads operated by
the Government, or by Japan—Japanese engineers—but we have never sold
any locomotives to railways that were built by German, British, Belgian, or
French capital, and operated by foreign engineers. We are not even asked to
tender on them.
x

We must have not only American investments, but we must have American
angineers to manage the railways in South America. The prejudice of foreign
engineers, when away from their own country, is Indescribable, They look
npon any product from any other country than their own as absolutely worthless.
 For instance, to give you an illustration: In Brazil, Mr. Farquhar, who
went down to Brazil some 10 or 12 years ago and succeeded in consolidating and
jeveloping a number of small railways that were partly owned by French,
Belgian, English, and Brazilian companies, and who formed the Brazil Railway
Co., appointed an entire American staff—American managers, American engineers,
 civil and mechanical, etc. And we supplied (I do not mean ourselves;
[ mean manufacturers in the United States) practically all the locomotives,
rolling stock, and other machinery used since that time. Now there has
heen a change in the management, and we shall propobly meet with foreign
competition, unless the former management comes back. American investments,
 in foreign railways, will naturally result in American engineers managing
 such railways; and if they are to establish American standards, then,
naturally, our industries will greatly benefit.

(f) Advantages in Industrial Efficiency.

In speaking of the competition with German and English manufacturers,
 William Gt. Arnold, Juoretany of A. B. Dick Co., Chicago,
[1l.. manufacturers of duplicating machines. said:

Their prices, on account of cheaper manufacture, are considerably lower
chan ours, and, of course, we have to sell as cheaply as we possibly can over
there in order to meet the trade, although within the last year we have pro-Juced
 some new machines and improved our products beyond what theirs is,
and in that way, on quality alone, we have been able to command some business.
S. H. Roberts, secretary-treasurer of the Phoenix Horse Shoe Co.,
Chicago, Ill, said:
Almost invariably we have found that the foreign people want goods put
up in a special way, different from the customs of this country, and where the
hand labor enters very much into it, it is almost impossible for American manufacturers
 to compete with the foreigner because of the cost of labor.
Walter C. Fish, of the General Electric Co., New York City, said:

Of course I do not have to tell you gentlemen of the Commission anything
about the wages paid abroad, or anything about the eompetition we have to
meet on account of foreign labor. * * * There are portions of Europe
fully as efficient as we are and paying one-half the wages.
That brings to my mind the question of not only obtaining foreign trade but
of subsequently retaining it. I haven't the slightest doubt but, with all this
wonderful stimulus which you are giving to the desire to get foreign trade,
that we are going to get more of it, but principally along lines concerning our
natural resources and concerning products dependent upon these natural regources.
 We will also get foreign business principally where the per cent of
labor, so to speak, in the value of the product is comparatively small. Our
start in increasing our foreign business will be along such lines.