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contracts, and those who do take it will have to raise their prices sufficiently to take care of the contingencies of a strait-jacket that is poured around him; and the probable result is, the thing we are afraid of, is that some other bright young man may discover the idea that the Government should go into the manufacturing business itself and make all of its own furniture. They started out to do it with mattresses. It was not much of a program, to be sure. They were only going to make 2,000,000 mattresses, which is onethird of the total market. It does not amount to much, would not interfere much with the manufacturers.

There is no end to that particular thing. The further that you go with it the less industry is able to bear the burden of taxation, the less incomes there are to be taxed, the less industry is able to take the punishment; and by the same token, just like the vicious circle of taking a drug, you have got to have more and more Government factories producing more and more of the products, and you are killing off the very people on whom you want to lean. A lot of us want to recover.

Worse than that—in this bill there was one good feature, and that was that in the event the Government set up a plant it would have to meet the same conditions that a private plant had to meet. That has been wiped out, and Uncle Sam will acquire private factories, under this bill as it now stands, to meet certain standards of hours and wages, but Uncle Sam can do exactly as he pleases when it comes to providing hours and wages. At least that provision ought to be put back.

Now, here is another thing; after all, this is a much bigger thing, a more vital thing, than simply whether or not a particular bill, which would be a sore and a pest and a thorn in the side, shall be passed. I don't care much whether this bill is passed or not from a long-time point of view, because it cannot work.

Labor would not even benefit by it. Whenever I want to get a good laugh I think of a bill like this being of any help to labor, or even the Wagner bill. Labor was, in fact, better off when it fought its own battles and stopped getting itself into a trend toward the point where legislation of Congress would tell it what it could do. The moment that labor starts to monkey with Government and get Government to fight its battles it begins to get itself into a position where subsequently it does not dare fight, because it is going to have to take the dictates of Government, precisely as has happened in Russia and in Germany.

If labor are smart-and they are not; they are just as stupid as a lot of industrialists—if labor were smart, they would not want much help and would not ask for it. They would fight their own battles. They don't need them for collective bargaining. They fought their battles pretty well in the past, and they were getting along pretty well in the past, and if it had not been for the efforts, the stupid efforts, for recovery we would probably be a good deal closer to it right now.

Here is your choice, as I see it: You have got to choose whether you want Government industry in competition with American private industry or whether you want to see business work its way out by laws that cannot be violated. I know there are a lot of cheap soap-box orators that get up and talk about all kinds of schemes for using the fruits of honest business for building up a business run by Government and all that sort of thing. Why, in the last few years conducting your business so as to make a profit and be able to meet pay rolls and have something left to show for it all has become so unpopular that individual business men are absolutely discouraged from attempting to play fair, as though it were something disgraceful for a man to make a profit, as though it were something disgraceful for a man to run his business so that when he is all through he has something left over.

Ye gods! When you think back but a few years ago, when men in this country were not women, as some of them now are, when they were men, when the plumbing was out of doors, when they fought their own battles, when they didn't ask God or President Roosevelt or General Johnson or anybody else to provide the next meal, but when men said, "All I want is a chance", and if he couldn't get it he took it

Mr. WALTER. Do you still believe that prosperity is just around the corner ?

Mr. HAAKE. Why, man alive! Prosperity is begging to get inbegging to get in!' I tell you candidly, and I know what I am talking about. I happen to have been an economist, head of a department, and I learned a lot more since I tried to apply some of the things than I ever knew when I read the books and wrote about it. I know, and I believe that you know, that there is enough stored up demand right now-think of it—the postponed demand for all sorts of commodities for the past 4 or 5 years. In building alone there is enough to keep the building industry going for several years. In furniture we can keep our plants going for 5 or 6 years, just to catch up with the demand. And so we can take industry after industry.

Why isn't it done? For the simplest reason in the world. If you or I had $50,000 and someone said to me “Will you invest that $50,000 in business and put a lot of people to work”, and at the same time tell me “ You can't make any profit. We are going to tax you to death. You are a disreputable person. You have got to do this and got to do that ”, I would say, “ Oh, heck-what's the

And so would you . Now, my last word is simply this, that I do not think that the bill could possibly work. I think that Congress could wisely—if I may have the temerity to offer this suggestion--that Congress could wisely consider the advisability of putting business somewhat more on its own and put up to business the responsibility of getting back into activity, instead of trying to help it in spite of itself.

I thank you, sir.

The CHAIRMAN. We have got to get along here. It occurs to me that it would be very well for those who have amendments to suggest to the bill to be grouped. One or two gentlemen have spoken to me about it. Mr. Kane, I believe, is here and he asked for 3 minutes. These people get so enthused over their own eloquence that it is hard to stop. I know all about it, because I have the same trouble, but we are going to have to limit them now.

Mr. MICHENER. Mr. Chairman, may the speakers limit themselves to the bill?

use.

The CHAIRMAN. That is right. We do not want any oratory. We would like to have a statement of your position and whatever facts you have to present. Just tell us about it.

STATEMENT OF DONALD KANE, REPRESENTING NATIONAL

COOPERATIVE MILK PRODUCERS FEDERATION

Mr. KANE. Mr. Chairman, I represent the National Cooperative Milk Producers Federation and National Cooperative Council, having a membership of approximately 1,250,000 farmers engaged in the cooperative marketing of agricultural products and the cooperative buying of farm supplies.

The Senate placed in the bill a section 12, which will be found on page 20, with the consent of Chairman Walsh, of the Senate committee. I merely want to say that it has been our understanding that certain private interests are desirous of being exempted and are trying to attach their exemptions onto this farm exemption. We have no objection to any exemptions that Congress may see fit to grant to any private interests, but we do not want it attached to our exemption, or we do not want our exemption taken out and a new exemption written in to cover more people.

The CHAIRMAN. You want to be exempt, but you do not want anybody else exempt; is that the idea?

Mr. KANE. No, no; that is not it, Congressman. We do not care who is exempted, but we think the exemptions ought to be set up separately. That is, we have an agricultural exemption here, and if there be any other exemptions let them be put in separate sections and not included in agricultural exemptions.

The CHAIRMAX. We will take care of that. I thought you had an amendment.

Mr. KANE. I have one amendment. The CHAIRMAN. You better get to it. Mr. KANE. Section 12 exempts loans made by the Farm Credit Administration, but it fails to exempt loans made to farmers by the Commodity Credit Corporation, and we would like to have added at the end of line 19 on page 20 after the words “ Farm Credit Administration ” the following: " and the Commodity Credit Corporation.”

The CHAIRMAN. All right, sir; we will consider that.

Mr. DUFFY of New York. Does that come under the Farm Credit Administration?

Mr. KANE. There is counsel here, Mr. Chairman, who are more familiar with the operation of the Commodity Credit Corporation, and if they will be permitted a few minutes

The CHAIRMAN. Not now. We will talk to them privately. We have got to get along. Now, who else has an amendment to submit?

STATEMENT OF BURT L. KNOWLES, REPRESENTING ASSOCIATED

GENERAL CONTRACTORS OF AMERICA, WASHINGTON, D. C.

Mr. KNOWLES. Mr. Chairman, my name is B. L. Knowles. I am a general contractor from Massachusetts, representing the Associated General Contractors of America.

Yesterday you asked two or three of the witnesses a question which I would like to answer. You asked the question if it was not desir

able to have a measure passed which would eliminate irresponsible bidding from chiselers. I think that is substantially your question. The answer from the general contractors' point of view is unqualifiedly in the affirmative, and if this measure will do it we are for it.

The unscrupulous bidder, the unintelligent bidder, and the chiseler have been the ruin of the construction business for many years, and whatever will eliminate that practice is highly to be desired, of course.

Mr. RobsIon. Would it interrupt you to ask a question ?
Mr. KNOWLES. Certainly not.

Mr. Robsion. You mentioned that you ought to eliminate the unintelligent bidder. Would this bill reach that?

Mr. KNOWLES. I don't suppose that any bill can prevent a man from being a consummate idiot, but it would help him a lot after he had been stung a few times.

Mr. Robsion. He gets that anyhow, without an act of Congress, doesn't he-he gets stung?

Mr. KNOWLES. He is apt to, yes; in the long run. This might facilitate or speed up the process, however.

During the last presidential administrationThe CHAIRMAN. Pardon me; do you have a specific amendment to offer?

Mr. KNOWLES. I have, yes.
The CHAIRMAN. Let us have it.

Mr. KNOWLES. Very well. I was just leading to it, because it is a matter of history.

The CHAIRMAN. Yes, sir. Well, cut out the history and let us have the amendment.

Mr. KNOWLES. All right. The Associated General Contractors of America, representing the general contractors of the United States who are organized to express their opinions through a national association, ask that this committee give serious consideration to putting back into this bill the provision which makes this act apply to governmental agencies in competition with private enterprise.

This bill, as reported to the Senate by Senator Walsh, Senator from my own home State, contained a section 10, which reads as follows:

The provisions of this act shall apply to governmental agencies in competition with private enterprise for contracts described in this act.

This section was stricken from the bill on the floor of the Senate. The record of the discussions would indicate that the Senators who opposed this provision were under the impression that it would place a serious handicap on the Government departments, particularly the shipyards.

We desire to call the attention of this committee to the fact that section 6 of the bill provides the President with the express authority to make exceptions in specific cases.

It is obviously just and appropriate to require governmental departments to comply with the same provisions as are required of contractors under this act, and if such compliance with this act should create an unreasonable requirement of the Government or place it at a disadvantage, then the President has the power to make the necessary exceptions.

We hereby request this committee to give serious consideration to place section 10 back in the bill.

The CHAIRMAN. Thank you. Any other suggested amendments?

Now then, we are going to hear from those who are the proponents of the bill, who favor the bill. I don't know whether we have a list of them or not. Mr. Myles is in favor of the bill. We will hear you now, please, sir.

Mr. MYLES. All right.

The CHAIRMAN. Mr. Myles, excuse me just a minute. What became of that gentleman who wanted to come here from Chicago and sent a lot of telegrams?

Mr. ADAIR. Mr. Chairman, he called and said he had missed his train.

The CHAIRMAN. I thought he was going to take a flying machine. Anyhow he is not here.

STATEMENT OF JAMES M. MYLES, CHAIRMAN BUILDING TRADES

DEPARTMENT, AMERICAN FEDERATION OF LABOR

Mr. MYLES. Mr. Chairman, my name is James M. Myles.
The CHAIRMAN. Whom do you represent?

Mr. Myles. I am vice president of the Operative Plasterers' and Cement Finishers' International Association and chairman of the Building Trades Department of the A. F. of L. I am speaking for the building trades. You have other names in here, too; Mr. Hushing and others.

This bill (S. 3055) makes clear that all Government contracts must be awarded to firms that observe the minimum wages, the maximum hours and labor standards which were originally provided for in codes of fair competition for trades or industries under the National Industrial Recovery Act.

The decision of the Supreme Court in declaring the codes unconstitutional was a terrific blow to labor. Particularly to the construction crafts was this true, because many of the codes were consummated through voluntary agreements and understandings between associations of employers and employees within the various subdivisions of the construction industry. This was true of the Operative Plasterers' and Cement Finishers International Association, which I represent. Our association has enjoyed with our employers collective bargaining agreements and understandings for the past 70 years.

When the voluntary collective bargaining agreements for the plastering and lathing industry, which included minimum hourly rates of pay and maximum hours of work and labor standards, were presented to the National Recovery Administration, these agreements became a Code of Fair Competition for the Plastering and Lathing Industry, composed of modelers, model makers, shop hands, plasterers, and lathers.

During the consummation of this code collective bargaining agreements were expiring in various localities throughout the counéry. The renewals of these agreements were held in abeyance pending approval of our code and the setting up of proper rules and regulations to govern agreements within the respective regions. Very few of these regional agreements had been approved when the Supreme

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