One of the essential strengths of our entire economy is the vitality and diversification of our industry. While no clear cut lines of demarcation can be drawn without overlapping, the submissions made to the Commission indicate that our industry falls into three broad classes.
The first class is that type of industry, generally referred to, with more or less inaccuracy, as the mass production industries in which for various reasons, methods or processes, size of markets, machinery, or other causes, unit labor costs are generally low here as compared with other countries and little or no problem exists with respect to imports.
The second class is one in which machinery and production facilities, generally speaking, are identical or at least similar here and abroad.
In some of these the same number of man-hours goes into a unit of goods here and abroad; in others the use of labor is less efficient abroad than here and there may be other offsetting cost factors. Whether or not imports may be seriously damaging is dependent on factors which vary industry by industry, but in at least some of these the labor factor is the controlling element.
The third class is the so-called handicraft type where machinery is a minor element. Here quite obviously, with labor the major cost, imports can be not merely serious but destructive to the domestic industry without a tariff.
Yet all three classes or types of industry are a necessary part of our total economy, and in all of their variations they must pay wages generally in harmony with the general level of wages throughout the country. We would not have it otherwise; and we do not wish it to happen that the wage level in the third class and in some of the second class should be determined or seriously affected by the wage levels abroad in competitive industries.
What we have said does not single out an industry or industries for specific recommendation, but should make clear that a policy of gradualness and close consideration of the effects of action already taken is in the national interest at this time.
It should further be quite clear that we do not believe that unilateral action by the United States will solve the world's trade problems. Beyond that, however, we do not intend by this portion of our report to indicate that we believe the foregoing actions should be taken regardless of actions by other countries. On the contrary, it is our belief that actions by the United States such as we have outlined should so far as possible be taken contemporaneously with and related to action abroad toward conditions that will permit trade to move and to be balanced multilaterally as in the past. During the 3-year period above specified we should give consideration as to how far other countries have gone with corrective actions which they alone can take.