Mr. TREADWAY. But you feel that irrespective of that difference you would be put out of business? Mr. WILCOX. Yes, sir. Mr. TREADWAY. Where would the coal be mined, in your judgment, that would take the place of what you are now selling? Mr. WILCOX. I think it would be mined north of the Ohio River. Mr. TREADWAY. Pennsylvania? Mr. WILCOX. Pennsylvania, Ohio, Illinois, and Indiana. Mr. TREADWAY. There would not be any trouble from Illinois if they are put out of business, too? Mr. WILCOX. The gentleman this morning, if I understood him correctly, is from one section of Illinois, that is, the southern section. Mr. TREADWAY. That is a very large coal area, I understand. Mr. WILCOX. Yes, sir; that is the southern section of Illinois. Mr. TREADWAY. The southwestern, is it? Mr. JENKINS. All the south. Mr. TREADWAY. My colleague, Mr. Jenkins, knows the territory out there better than I do. It is a pretty wide area that he was describing this morning. Mr. WILCOX. I realize that; yes, sir. Mr. TREADWAY. How broad an area, including your own, do you think the enactment of this bill would put out of business in the coal fields? Mr. WILCOX. I am not in a position to explain that, Congressman, because my interest is with the few laborers that we have there; and just exactly what effect it would have on the industry as a whole I just do not know. Mr. TREADWAY. We ought to be able to get information, you know. I am as ignorant as can be about any feature of this except paying bills for using some of the coal. That is all I know about the coal industry, the consumer's viewpoint. Do you think this legislation will seriously affect the price of bituminous coal to the consumers north of the Ohio River? Mr. WILCOX. I do not know how much my opinion is worth, but I think it would do it considerably. Mr. TREADWAY. To what extent? Mr. WILCOX. I am not in a position to give you any positive figures. Mr. TREADWAY. Would you say it would increase the price 25 percent to the consumers? Mr. WILCOX. I would be afraid to say any percent, because it would not be based on anything definite, consequently it would not mean anything. Mr. TREADWAY. How are we going to find out about the effect of this bill other than through the testimony that you and others give us? Is there any other industry possible in that area than mining? Mr. WILCOX. That is about all there is there, mining and farming. Mr. TREADWAY. Are these miners good farmers? Could you raise potatoes instead of digging coal? Mr. WILCOX. They would not be very happy at it. It might be that you could get them into that kind of business, with a lot of effort. Mr. TREADWAY. Do you think any of them would apply for any of that land up in Alaska? Mr. WILCOX. I do not expect we would. Mr. VINSON. It is mighty good country down there, is it not? Mr. WILCOX. Fine, Mr. Vinson; fine. Mr. VINSON. What was the wage scale just immediately before N. R. A.? Mr. WILCOX. I think the maximum was $2.50. Mr. VINSON. What was the increase in October 1933? Mr. WILCOX. It went from $2.56 to $4. Mr. VINSON. Did you have another increase in April 1934? Mr. WILCOX. In April 1934? Mr. VINSON. Yes; April. Mr. WILCOX. Let me get the dates right. No. No, sir; we did not. Mr. VINSON. What is your present wage scale? Mr. WILCOX. We have a base of $4 and $3; $3 outside and $4 inside-basic scale. Mr. VINSON. You are speaking of the mine? Mr. WILCOX. Yes, sir. Mr. VINSON. $3 outside the mine? Mr. WILCOX. Yes, sir. Mr. VINSON. And $4 inside? Mr. WILCOX. $4 inside. Mr. VINSON. Is there any difference in your prevailing wage scale and that which was set up under N. R. A.? Mr. WILCOx. No, sir; there is not. Mr. VINSON. What is the prevailing wage scale in Illinois? Mr. WILCOX. I believe it is $5. I am not sure about that. Mr. VINSON. That is just your general understanding? Mr. TREADWAY. Is there any very great use of comparing N. R. A. wage scales, when N. R. A. has been thrown out the door by the Supreme Court decision? Of what use is something that was illegal and unconstitutional, in comparison with present-day conditions? Mr. WILCOX. Of course, we welcomed the N. R. A. very much. We want all we can get. Mr. TREADWAY. Knowing it is not constitutional to set up that sort of a program, you would not approve it in view of the decision of the Court, would you? Mr. WILCOX. I do not think so. Mr. HILL. You would approve the increase in wages, though? Mr. TREADWAY. Yes; of course. Mr. Wilcox. I approve the increase in wages to the very highest extent. As long as there is a differential maintained that will take care of the differential in freight rates between the two territories, we will be sitting all right, we will continue to go along. Mr. HILL. These increases in wages were brought about through the regulation under the N. R. A.; is not that right? Mr. WILCOX. Absolutely; yes, sir. Mr. HILL. That is all. Mr. DOUGHTON. You are talking about the per diem wages? Mr. DOUGHTON. What about your hours? Were there any regular hours under the N. R. A.? Mr. WILCOX. We are working 7 hours. We worked 7 hours under the N. R. A., and are still working 7 hours. Mr. DOUGHTON. And prior to the N. R. A.? Mr. WILCOX. Eight hours. Mr. DOUGHTON. That is all. Mr. VINSON. Did you favor the extension of the N. R. A. for the 2-year period? Mr. WILCOX. Yes, sir. Mr. VINSON. Thank you. Mr. HILL. That is all; thank you very much. We will adjourn until 10 o'clock tomorrow morning. (Thereupon, at 4:20 p. m., the subcommittee adjourned until tomorrow, Wednesday, June 26, 1935, at 10 a. m.) STABILIZATION OF BITUMINOUS COAL MINING INDUSTRY WEDNESDAY, JUNE 26, 1935 HOUSE OF REPRESENTATIVES, SUBCOMMITTEE OF THE COMMITTEE ON WAYS AND MEANS, Washington, D. C. The subcommittee met at 10 a. m., Hon. Samuel B. Hill (chairman) presiding. Mr. HILL. The committee will come to order. Mr. Francis is the first witness this morning. Will you give to the reporter your full name, your residence, and state whom you represent? STATEMENT OF JAMES D. FRANCIS, HUNTINGTON, W. Va., PRESIDENT ISLAND CREEK COAL CO., AND POND CREEK POCAHONTAS CO., REPRESENTING THE COMMITTEE IN OPPOSITION TO THE GUFFEY-SNYDER COAL BILL Mr. FRANCIS. Mr. Chairman, my name is James D. Francis; my residence is Huntington, W. Va. I am appearing as president of the Island Creek Coal Co., and the Pond Creek Pocahontas Co., and on behalf of the committee in opposition to the bill. Mr. Chairman and gentlemen of the committee, in appearing here in opposition to this bill, I am going to address myself almost entirely to some of the practical phases of this bill from the marketing and organization standpoint. But I want to say in the beginning that in my opinion this bill is throughout unconstitutional and contrary to sound public policy. The legal phases of this bill have been covered by other witnesses. Without going into them in detail, I believe that the bill, if challenged in the courts, will be found to be unconstitutional in its tax provisions, in its interference with interstate commerce, its labor provisions, and the fact that it violates, in my opinion, both the fifth and the tenth amendments to the Constitution. It is not sound from the public standpoint, it is against sound public policy in attempting to set up a monopoly in a necessary and essential product, in a necessity of life, for the benefit of the producers and employees in the coal business, at the expense of the Nation generally. Even if the bill were constitutional, and were not, as I believe it is, against sound public policy, it is economically unsound because it attempts to set up an organization for the production and marketing of coal which is wholly unsound and unworkable, from an economic standpoint, and which would decrease the use of coal, and decrease, likewise, the number of men employed in the production, transportation and handling of coal. Coal has no natural monopoly as a source of heat, light, and energy. Twenty years ago it supplied 72.7 percent of the total heat, light, and energy of the entire country. In 1918 the production in this country amounted to 579,000,000 tons, representing 72.3 percent of the total national.demand for heat, light, and energy. Last year, in 1934, there was produced 358,000,000 tons, so that bituminous coal only supplied 46.3 percent of the demand for heat, light, and energy. Mr. VINSON. Do you think that is a fair comparison, Mr. Francis, taking the production in a war year? Mr. FRANCIS. The war year was a high year, but the percentage in the war year, Mr. Vinson, you will note, is just practically the same, the percentage in 1914 being 72.7 percent, and 72.3 percent in the war year. The energy, heat, and light load has gone upward in this country, while the coal production has gone down. Mr. VINSON. I was speaking particularly of the total tonnage. Mr. FRANCIS. That is a high year; that is an abnormally high year; 500,000,000 tons is a good big year. Mr. VINSON. Let us come down to that. What is the average bituminous tonnage annually, say, over the last 10 or 15 years? I think that would be a better criterion. Mr. FRANCIS. For 15 years I would say there is an average of 500,000,000 tons. Mr. VINSON. Would it average that much? Mr. FRANCIS. Yes. Mr. VINSON. We were told yesterday Mr. FRANCIS. Last year. Mr. VINSON (Continuing). That in 1 year it was 310,000,000 tons and in another year it was below 350,000,000 tons, as I recall. Mr. FRANCIS. The years 1932, 1933, and 1934 have been low years. Mr. VINSON. Could you put a statement in your remarks showing the annual production of bituminous coal by the year, for the past 15 years? Mr. FRANCIS. I will be very glad to file that and put it in the record. The point I desire to make in that connection is that but for the substitution of oil, natural gas, and hydroelectric power, and the fact that we have put in higher percentage units of consumption, where you take less coal to do the same work, we would have in the year 1934, if we had produced at the same rate, 72 percent, as we did in 1918, or as we did 20 years ago-and if coal had stood in the same position as it did for many years, we would last year have produced 500,000,000 tons, the point being that but for the high delivery price of coal and the use of substitures, coal would have stayed up above the average of 500,000,000 tons, and not descended to the low valley of 330,000,000 tons. Mr. TREADWAY. May I ask the witness, in that connection, this question. Referring to the reduction in the use of coal, on account of the substitutes to which you are now referring, such as oil, natural gas, and hydroelectric power, do you think that the reduction in quantity has anything to do with the clause in this bill looking to the purchase of coal lands by the Government? |