Book tariff testimony

U.S. Trade Representative
Hearings on proposed tariffs
Washington, D.C.
June 19, 2019
Testimony by George Dick
Four Colour Print Group

I have been helping publishers manufacture books in China since I founded my company in 1985. I broker printing between Chinese printing companies and US book publishers. Because I buy the freight to transport the books from China to the USA, I am officially the “importer of record”, and as such the burden of paying the tariff would fall upon my company. In turn, I must add the cost of the tariff to the invoice presented to the book publishers after I deliver the books to their warehouse, or as the case may be; to their garage.

The cost of these tariffs will be devastaing to the book publishing industry – and hardest hit would be the market sector known as “trade” book publishers. Trade books are those traditionally sold through bookstores (as opposed to textbooks distributed by school systems.)  Trade books are sold across America by thousands of small privately-owned bookshops in every city – as well as on the internet directly by publishers and of course, by Amazon.

I estimate that 90% of all children’s picture books are printed in China – many by large publishers from which you have already heard. But there are hundreds of other small publishers scattered across every corner of America that compete in the same marketplace. These are my customers. Artbooks, photography books, guidebooks, cookbooks, graphic novels, instructional books, educational books, you name it, all would be affected. Other market segments such as academic, medical and scientific books that are printed in full color would also be damaged. 20% of the business that my company handles are books published by University Presses from every state of the Union; some have already closed due to financial difficulties and this would only worsen the problem.

Book publishers and printers operate on very thin profit margins, so this tariff cannot be absorbed by either. And since books are very price sensitive, it would be very difficult for publishers to raise the cost of their books to cover the cost of the tariff. Some book prices would double since many publishers use a formula to set retail prices at 5X their cost.

Ultimately, the effect of the Chinese tariffs would be to severely curtail the publishing activities of trade book publishers. This would cause fewer books to be published, jobs lost at both publishing companies and in your neighborhood bookstores, less choice for parents who wish to read their children a bedtime story, and higher prices for anyone who wishes to educate and enjoy themselves reading a printed book.  Do you really wish to make Americans dumber and more bored?

I would also like to add further my opinion as to this entire idiotic trade war, described by President Trump as “good for America” and “easy to win”.  A trade war, like most all other wars, creates massive collateral damage that politicians don’t consider or care about. I will tell you having traveled to China regularly for over 30 years, that neither China nor Chinese people are the “enemy.” The printers I represent in China are owned by hard-working, risk-taking entrepreneurs, and the workers in these factories cherish their jobs.  Chinese people LOVE Americans, and they treat us with the deepest courtesy and respect. China is our friend.

It is completely ignorant to believe that Americans will be better off because of tariffs. That some manufacturing jobs, including those in the printing industry, are now located in lower wage countries like China is not a bad thing for America – it is a good thing. I can tell you that many of these jobs are mind-numbingly repetitive, exacting a serious physical toll, and we are fortunate that we have foreign workers to handle them for us.

But do not cry for nor criticize China, as low-wage labor is a necessary step in a country’s economic development, the same as we in America went through in the early 20th century. Luckily, we can now devote our resources to the more intellectual and better paying tasks of creating the content for books, designing and illustrating them to be useful and appealing, and to distributing them widely and inexpensively for the enjoyment and education all.  This is wonder and glory of free trade.

Best of all, free trade confers benefits to all parties and peoples involved. Americans benefit by having access to beautiful books at low cost; our Chinese friends benefit with increased employment, rising wages, and business expansion. We need no government authority to help us or tell us to do this; we only ask that no government authority prevent us from conducting our business.

To think stopping trade with China will bring jobs back to the USA is folly. Already book printing orders are being shifted to Korea, Vietnam, and India. We cannot afford, nor do we want, to force the return of low-wage, dead-end manufacturing jobs here in the USA. We are all made richer by free trade with China, and I implore you, Congress, and the President to stop this self-destructive foolishness.

Thank you.

George Dick
President
Four Colour Print Group
2410 Frankfort Avenue
Louisville, KY 40206

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George Dick's book tariff testimony for USTR

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