of workers, simply because they were denied the opportunity to use existing industrial equipment to produce goods.

Today, with the technical progress made since 1929, we could create a national standard of living at least 6 percent above the highest ever reached (in 1929). Yet we deny work to over 12,000,000, maintain nearly 5,000,000, of them in poverty at Government expense, and do nothing for the rest.

We have in America the greatest producing mechanism in the world. Why have we failed to put it to work? Chiefly because we were not permitted by the Judiciary to work out our attempt to discover how this could be done.

Even to suggest such a plan is beyond our scope, but at least a few significant facts could be pointed out, based on rough calculations from available data. To lift production to higher levels an increase in average wage income is necessary. This fact has been clearly shown in such studies as those of the Brookings Institution and the National Survey of Potential Product Capacity." It is also borne out by our experience since 1919, when wage increases have

PER CAPITA PRODUCTION: ACTUAL AND POSSIBLE

Index: 1923-25-100

120

110

100

90

80

70

60

50

40

30

20

1919 1920 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 The shaded area represents actual production per person in the United States; the rising line above shows the production our industries have proved themselves capable of giving us. Depressions have destroyed billions of dollars' worth of wealth. (Source: The chart is taken from Cleveland Trust Company Business Bulletin for February 15, 1936; rising line above added by American Federation of Labor.)

held a definite relation to increases in per capita production as shown on the chart. The first peak of production was in 1920 at index 100; the next peak in 1923, at approximately 105 or 5 percent above 1920 was reached when the average "real" wage in the United States had increased 10 percent above 1920. The 1929 production peak, 10 percent above 1920, was reached when the "real" wage had risen 20 percent above 1920. If we are to continue this progress and if we assume that wages must rise at this same rate in order to lift production, then our present average wage should be 32 percent above 1920 to lift production to the point 16 percent above 1920 which we know is possible for 1936. This means that average wages in the United States should be 13 percent higher than they are today, at the present cost of living. To reach maximum production we must also reemploy the unemployed.

Brookings Study: See The Formation of Capital, by H. G. Moulton and others. National Survey of Potential Product Capacity: See The Chart of Plenty, by Harold Loeb.

These are rough figures, yet they suggest an approach to our greatest economic problem, that of lifting production to the highest point of which our industries are capable, and so putting the unemployed to work creating wealth. Should we not begin with an attempt to discover how a 13-percent wage increase can be achieved?

Mr. DUFFY of New York. Before you leave that, Mr. Green, have you any figure that would represent, under normal conditions, what the employables would be?

Mr. GREEN. Well, it has been so long since we had normal conditions, it is pretty hard, pretty difficult to establish that.

Mr. DUFFY of New York. In reviewing these figures, you must have some estimate in mind.

Mr. GREEN. We have some estimate; yes. I think that, under normal conditions, our unemployed army ran around 1,500,000 people. Mr. WALTER. When you speak of "normal conditions", what year do you refer to, or years?

Mr. GREEN. That is the sort of normal condition such as prevailed between 1920 and 1929, along in that period. There will be a fluctuation, the number will fluctuate, say, between 1,500,000 and 1,800,000. Mr. SUMNERS. How do you get your figures as to who is employed and who is not?

Mr. GREEN. I will be glad to submit that. It is brief, and I will read it:

Our unemployment estimate is based on the census of unemployment taken by the United States Government in 1930, which shows both the number at work and the number unemployed in the United States.

The employment and unemployment figures shown by the census are brought up to date by using United States Government indexes of employment, including those published by the Bureau of Labor Statistics, the United States Department of Agriculture, the United States Department of Commerce, and the Interstate Commerce Commission, and by accounting also for the increase in persons seeking gainful work. In estimating the number seeking work, figures of the Scripps Foundation for Population Research are used.

That is the most reliable authority in the United States on that particular phase of it.

All persons engaged on Government emergency work, including W. P. A., P. W. A., and C. C. C., are counted as unemployed, because they are not engaged in normal industrial work.

The total number of persons employed in January on all Government emergency projects was 3,672,570. (Includes P. W. A., W. P. A., C. C. C., Resettlement, and all projects financed through the $4,000,000,000 appropriation.) Total unemployment, January 1936--

Government emergency employees, January 1936.......

Total

12, 626, 000

3, 672, 570

8, 953, 430

I estimate it is purely an estimation-I estimate that through the efforts of the administration to relieve unemployment since 1933, more than 5,000,000 unemployed have been put back to work.

The unemployment figures that I have just read include all classes-farm, white collar, domestics, and so forth.

It is estimated that the total employed, in all classes, in 1936, this year, was 39,579,000.

Mr. HEALEY. How many do you think are working now on that emergency work?

Mr. GREEN. Three million six hundred and seventy-two thousand five hundred and seventy. Every year we have a large number of young people who have reached adult age, when they, too, are seeking employment. So they must be taken into account, along with the number who are permanently unemployed. I am glad to submit this for the record because it is the method we employ, the most available scientific method. There may be some errors in it, and I am not presenting it as perfect.

Mr. SUMNERS. I am afraid I have led you too far away from the bill, Mr. Green.

Mr. GREEN. I think I am through, so far as I am concerned, on that, unless you wish to ask me some questions.

I will put this statement in for the record, and also our last unemployment report, if you wish.

Mr. HEALEY. We will be glad to have them in the record.

(William Green, president of the American Federation of Labor, issued the following statement on unemployment:)

Unemployment increased more in January 1936 than in any other January for the last 5 years, according to the estimate of the American Federation of Labor. Between December 1935 and January 1936 unemployment rose from 11,397,000 to 12,626,000, an increase of 1,229,000. Unemployment always rises in January, but last year the increase was only 699,000 and the last time there has been an increase approaching that of this year was in January 1931, when 1,328,000 were added to the unemployed.

To lose ground to such an extent at this time is nothing short of tragic. For the last 3 months employment has been gaining, and by December 1935 there were 1,554,000 more persons at work than in December 1934. By January this figure had dropped by over 500,000 and the gain over last year was only 1,023,000.

How much of this employment loss is due to lengthening of work hours it is not yet possible to tell. It seems probable that longer hours have been an important factor, for records covering the months of July to December 1935 show that the work-week in industry generally has been lengthened by 3 hours and that as a consequence more than 1,000,000 possible jobs were lost. Undoubtedly this movement to lengthen hours instead of employing men, which followed termination of N. R. A., has continued into January and accounts in part for the present situation. This point is further discussed in the American Federationist for March.

Another important factor was the slackening of manufacturing operations in January this year. When industry operates without control every decline in operations means a loss of thousands of jobs. Manufacturing industries this year laid off 130,000 while in January 1935 they took on 13,000. In retail trade lay-offs following the Christmas season affected 50,000 more persons this year than last. In agriculture the fall layoffs appear to have cost 68,000 more jobs this year.

The fact that we thus lost ground in a number of industries in January, following as it does the loss of over a million possible jobs in the last half of 1935 augurs ill for the future. It indicates that industry is making no determined effort to put the unemployed to work and is quite willing to shirk all responsibility for them. Under such conditions even the continuing production gains we hope for this spring will do little to restore the millions of jobs needed.

Trade-union figures for the first part of February indicated, that in unions at least, a slight improvement is already occurring in anticipation of spring. Unemployment, as shown by our weighted figure, decreased from 17.2 percent of the membership in January to 16.7 percent in the first part of February; part-time work also decreased from 22 to 21 percent of the membership. This gain is small indeed compared to the number without work.

Of the 12,626,000 unemployed in January. 3,524.000 had work under the W. P. A. program and 148 259 were employed by P. W. A. Figures are not yet available to show the number receiving direct relief.

58539-ser. 12, pt. 2-36--18

The Federation unemployment estimates are covered in the following tables. Table 1 gives yearly averages for 1929 through 1935; table 2 shows monthly unemployment from 1933 to date, together with the trade-union part-time and weighted unemployment figures.

Mr. GREEN. Now, just summing up, in conclusion, I tried to present the facts and information which I have submitted, in support of this proposed legislation. I cannot conceive of any piece of legislation now pending in Congress that is more meritorous, more humane, and more greatly needed, from our economic and social point of view, than this bill. It will have a profound effect upon economic conditions in private industry; it will help wonderfully to elevate and build up and raise the standard of life and living among

the workers of the Nation; it will strike the most direct and damaging blow at the sweatshops that could be struck by any other process or any other way.

So far as the sweatshop is concerned, in producing the goods for the Government, it will eliminate it; and it makes me shudder to think that our Government, the great model employer, is engaged in buying goods from those employers operating sweatshops, home work, and the children of the Nation; and if there is any one employer in this country who should be prevented from doing that, it is our Government, because all of us contribute somewhat to the purchase of these goods and the maintenance of these sweatshop conditions.

I most heartily urge upon the Congress the enactment of this measure into law.

Mr. DUFFEY of Ohio. May I ask you a question, Mr. Green?
Mr. GREEN. Yes, sir.

Mr. DUFFEY of Ohio. It will be a hypothetical question, and I am quite certain that, from your experience as a member of the legislature in Ohio and in the high position which you occupy, that you are qualified as as expert:

Let us assume that the disposition is to carry into effect the meritorious objects of this legislation; let us also assume that commercial industry has a fear, whether it grows out of the depression, or selfishness, or any other cause or complication which might arise, if this bill, which is limited to Government contracts, should be enacted; let us assume, further, that the bill can be amended by having a general contractor-we will say the lowest and most responsible bidder-stipulate by an obligation in the contract that he, and all subcontractors under him, will not directly or indirectly employ child labor, convict labor, or permit home work; and limit this legislation, at this time, to the general contractor and those three conditions governing all subcontractors; and assuming, further, that for the present, the maximum wages and minimum hours would be held in abeyance, on the theory that time and experience on great universal legislation is necessary; and let you have the cornerstone or foundation of the objective of the bill in that simplified form; what do you say as to it being the solution of the present problem before us?

Mr. GREEN. Well, I would only regard it as a partial solution. Mr. DUFFEY of Ohio. It would be a long step in the right direction?

Mr. GREEN. Yes; but I should feel that it would be a very, very great mistake for the Congress to go that far without going the balance of the way and establishing minimum rates of pay that these employers must meet, and maximum hours, if they are going to get Government business. This simply says to him, "You do the thing that is fair and just in order to get this business."

Mr. DUFFEY of Ohio. In other words, if you go part of the way, you might as well go all of the way?

Mr. GREEN. All of the way in that respect, at least.

Mr. DUFFEY of Ohio. Let us assume, as a matter of fact, that we find ourselves up against such resistance or opposition that we cannot go all the way, then we can take a long step in the right direction-would you rather take that step?