Today, as a result of special privileges accorded labor, there is no incentive whatsoever for labor leadership to be anything but arbitrary. There is nothing, other than inarticulate public opinion, to restrain extreme or even lawless conduct. The employer, the natural agency to balance extreme proposals, has been stripped of any effective means of dealing with his employees when their leaders present fantastic and impossible demands.

Therefore, the point, as we see it now, is simply this: Is Congress going to accord labor still greater privileges and permit it to levy taxes which will add a tremendous burden to the living costs of the many to benefit a favored few?

We cannot believe that Congress will permit any person or group of persons to so usurp the traditional functions of democratic government.

In conclusion, I would like to second the points that Mr. Robertson, Mr. Smith, and Mr. Burke brought out so well-that the National Labor Relations Act itself appears to ban such payments.

Yet, what do we get? Nothing from the administration. There is nothing left for us to do but to urge you to pass adequate legislation that will bar now and bar forever what can turn out to be the greatest imposition ever devised on the American public.

And I think you will be doing a real and lasting service to the American people if you take that position.

I want to thank the committee for the opportunity to present my

statement.

Mr. GOODWIN. Mr. Chairman, I cannot resist the temptation to call to your attention that Mr. Mosher and I were a little while ago neighbors in one of the prettiest little cities of Massachusetts.

I have been a humble citizen, as a member of the Massachusetts Legislature, and later on in Congress, while Mr. Mosher has gone on to peaks of industrial life. Melrose, Mass., is very proud of Ira Mosher.

Mr. WEAVER. We are very glad to have this statement from you today.

Mr. WEAVER. Mr. William K. Jackson, president, United States Chamber of Commerce.

STATEMENT OF WILLIAM K. JACKSON, PRESIDENT, UNITED STATES CHAMBER OF COMMERCE

Mr. JACKSON. Mr. Chairman and gentlemen of the committee, my name is William K. Jackson. I am from Boston, Mass., and I am appearing here today as president of the Chamber of Commerce of the United States.

As you know, that organization has 2,300 chambers of commerce and trade organizations scattered throughout the United States. In those organizations there are about 950,000 members.

In addition to that, we have about 16,000 individual members who take an active part in the chamber's work.

On behalf of the chamber, I am here to support the general purposes of H. R. 6259, introduced by Mr. Robertson, and also the companion bill introduced by Mr. Howard Smith, both of Virginia. These bills are designed to make unlawful the exacting of royalties by unions.

I do not care to go into the technical question of whether or not such exactions are already outlawed by the National Labor Relations Act. I think there might be enough question about that-certainly I think there is to justify the enactment of legislation putting that question beyond any possibility of doubt.

We support this legislation because we believe that royalty exactions should be outlawed, for these reasons:

1. They constitute in effect the levying of a tribute by unions simply because they have the necessary strength to make the exactions. These tributes inevitably would increase the cost of production and bring about higher prices to the consumer; but, entirely apart from that, they are wrong in principle and should be prevented.

2. Where the exactions take the form of royalties upon production, the arrangement goes outside the accepted purposes of collective bargaining, which purposes are to deal with wages, hours, and working conditions, and they therefore set up a new and artificial advantage to union membership at the cost of the employer and of the public.

3. If the precedent is established, such royalty exactions could become universal in their applications; and they might be extended to any purpose desired by labor leaders.

We submitted this matter on April 5, 1945, to a vote of all the chambers of commerce and trade associations in the membership of the National Chamber. In making that submittal, we directed attention to a bill that had been introduced by Senator Bailey-S. 754-the essential provisions of which are in agreement with the provisions of Mr. Robertson's bill.

At that time we made this statement to our membership:

Recently there has been a startling instance of the exaction by a labor leader and union, as against a business enterprise, of a royalty per unit on sound recording in the musical field, and since then a similar exaction has been sought per ton-unit by labor leaders as to coal production as against the operators in that industry.

These exactions are not wages but extra going to union leaders or into union treasuries or trusts and not going to the employees direct or subject to their direct control.

By the same logic the principle of royalty exaction could be applied to an infinite number of service and commodity units in other lines of activity, all at the expense of the consuming public and with possible disaster to our national economy. Such exactions, if tolerated, would represent in effect a scheme of private taxation-a scheme in which the "taxes" would be levied, collected, and used, not by government but by private individuals.

That is what we said to our organizations at that time. They voted by a very large and overwhelming majority to approve this type of legislation which would outlaw these exactions.

This position which was taken in this referendum again came up before the annual meeting of the United States Chamber of Commerce at Atlantic City last week, and they passed this resolution:

Enforced payments by employers to labor organizations in the nature of a tax levy or royalty upon production may infringe the taxing power of the State, increase the cost of production, impede commerce, and foster private unregulated monopoly. Legislation to prohibit such payments and the acceptance of such payments by a labor organization should be enacted.

That was a resolution passed last week by our organization.

We favor this legislation because we believe that royalty agreements of the kind against which the legislation is aimed are not in the public

interest. The kind of levy upon industry proposed by certain union leaders is simply an exaction for the interest of a limited group chargeable to the expense of all.

We are aware that various arrangements are now in effect under which employers pay certain sums to unions for sick and health benefits. I am not going to discuss the origin of these plans, nor the extent to which they have been exacted by the unions, adopted as subterfuges under wage stabilization, or passed on to the public in the form of increased prices by the employer.

I am aware that to date some of the demands for such royalties have been accompanied by pledges that they would be used for providing hospital services and sick benefits for union members. Actually, the funds so raised would be entrusted to labor organizations to be used at their discretion, and they might be made to serve any other purpose which the union leaders decided upon.

So far as hospital services and sick benefits are concerned, the chamber of commerce is on record, by referendum vote of its members, in favor of adequate health-insurance programs, to be developed by employers and to provide benefits for employees either through group insurance, group hospitalization, and medical care plans, or through soundly organized plans for self-insurance. We have urged employers to make adequate provision for such plans, as part of the normal social obligation that devolves upon modern industrial operation.

But for a union or any other body to exact payments from industry for these or any other purposes, through the machinery of collective bargaining is wrong in principle, and ought to be prevented by law. That is all I have, Mr. Chairman.

Mr. WEAVER. Thank you very much, Mr. Jackson.

Mr. Tyre Taylor, general counsel, Southern States Industrial Council, will be the next witness.

STATEMENT OF TYRE TAYLOR, GENERAL COUNSEL,

SOUTHERN STATES INDUSTRIAL COUNCIL

Mr. TAYLOR. Mr. Chairman and gentlemen of the committee, my name is Tyre Taylor. I appear here as general counsel, and on behalf of the Southern States Industrial Council, which is an organization of manufacturers, natural resource industries and all forms of transportation in the 16 Southern States from Maryland to Texas, inclusive.

The Southern States Industrial Council of course favors the immediate enactment of legislation to prohibit the extortion of tribute or royalties by private organizations.

On principles so broad and fundamental as to constitute the very foundation of our system of government, we believe that no private group should have the power to levy taxes.

Under the Constitutions of the United States and the various States, only Congress and the State legislatures have the power to levy and collect taxes, while in the case of Congress, all bills for raising revenue must originate in the House of Representatives.

The reason for this is plain. The power to tax is the power to destroy and the framers of our Federal and State Constitutions felt

that such power should be entrusted only to the elected representatives of the people.

Therefore, to say that we favor the pending legislation is about like saying we favor the supremacy of government-representative of and responsible to all the people-over any private group or that we oppose the clothing of any private group with the attributes of sovereignty.

We do not believe that Petrillo or Lewis should be permitted to levy taxes any more than they should be permitted to coin money, or raise armies, or declare war, or grant letters of marque and reprisal, or regulate interstate and foreign commerce.

But while it is a strange and frightening commentary on the present state of the Nation that any private individual or private organization-however drunk with power-should presume to challenge these principles, the fact is that they are challenging them and getting away with it. For example: Under the notorious decision of the Supreme Court of the United States in the Teamsters' case, members of labor organizations may engage with impunity in what one member of the Court accurately characterized as common-law robbery.

Mr. JENNINGS. Mr. Taylor, the House has twice passed on that. It is now in a frigid condition on a block of ice in another body. You do not need to argue that with us. Most of the members of this committee voted for that bill. It is over there.

I am wondering now what will become of this measure, if we should pass it.

Mr. TAYLOR. Mr. Chairman and gentlemen of the committee, there is one basic issue involved here as we seee it, and that is whether effective restraint, safeguards or curbs should be placed on these organizations which are now in a position to challenge the very supremacy of the Government itself.

I have that argument here in about four pages. I will be glad to submit it to the record if you do not want to hear it. But we would like to make to the committee what we regard as the basic argument in support of this pending legislation.

Mr. JENNINGS. I did not mean to interrupt you. That just came to my mind.

Mr. WEAVER. We would be happy to have you put it in the record because we want to study the record.

Mr. JENNINGS. Any particular point you would like to emphasize, we would be glad to have it.

Mr. TAYLOR. I would like to emphasize, and I do not think it is sufficiently emphasized, the extent to which these private organizations fostered, aided and abetted by Government, have set themselves up into virtual dictatorship over the American people, and that is the issue that was involved in the Case bill. It is the issue that is involved in this bill, and that is the argument that we would like to make in support of it.

Mr. WEAVER. If you wish, Mr. Taylor, we would be glad to hear you. We are, of course, anxious to get the fundamental questions involved in this legislation.

Mr. TAYLOR. Unions may starve and freeze people by paralyzing all forms of transportation, or by refusing to mine coal.

The Bill of Rights affords the public no protection against them. Former Assistant Attorney General Thurman Arnold-who is certainly no enemy of the workingman-put the whole matter succinctly before this very committee.

"There is," he said, "No right in the farmer which labor is bound to respect; there is no right in the consumer which labor is bound to respect; and the independent businessman has no right which labor is bound to respect. In other words, labor's pressure on these groups is independent of any law whatever. It is entirely up to the will of the particular union.""

Among the rights of man which they can, and do, deny is the right to work-without which the right to life itself may be reduced to a mockery.

They did not hesitate to interrupt essential production during the time when this Nation was engaged in the most desperate war in its entire history.

Now that the war is over, they can, and do, stall reconversion, thereby not only inviting a disastrous inflation, but rendering it well-nigh inescapable.

A union of Federal Government employees-all of whom, presumably, have taken an oath to uphold and defend the Constitution of the United States-brazenly acknowledges its paramount allegiance to the Soviet Union.

The unions-particularly the CIO, operating through the PAC, may, and do, set a price on Congressmen. In this connection I would like to read a brief excerpt from a recent article in the Dallas Morning News. It was written by Lynn W. Landrum, one of the paper's columnists.

If the CIO takes $6,000,000 out of the pay envelopes of American workers to have a monetary say about who goes to Congress, what have you to say about it here in the Dallas congressional district? If Sidney Hillman, who probably never saw Dallas, decides to send $60,000 to $100,000 here to assure the election of a man who agrees to vote in Congress as Sidney Hillman and his PAC say vote on each of 17 stated matters, he can do it, and he will do it.

Such is the sinister and ruthless superpower which-aided and abetted by the Government itself-has grown to such proportions that it not only holds millions of workers in the bondage of what one union paper characterized as the "yellow-dog contract in reverse," but—as in the case of the current coal strike, to menace the security, the personal security of every man, woman, and child in the United States.

The issue presented by the pending bills-and before these by the Case bill which this House, to its everlasting credit, had the guts to pass-is whether the dictatorial power of these private groups shall be curbed-or whether they shall be permitted to fasten their rule on the people of this country permanently.

We would never think of conferring on Government a power that could be used to strangle the industrial and commercial life of the Nation. If any President attempted to do to the people of the United States what John L. Lewis is now doing he would be promptly impeached, and probably his sanity would be questioned.

We would never tolerate the exercise of such arbitrary power over the lives of the American people by the church, or by the National Association of Manufacturers, or by the chambers of commerce, or