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the most part they are inefficient for at least several months, or sometimes years, until they have had an opportunity to train themselves.

Those are part of the conditions that call for the recognition of what natural law has done through the ages, of wage differentials. So that I always resent that term of suggesting that a man who does not pay as high wages as somebody else is a " chiseler.” The term has been used quite freely here, today—“chiselers.” I want to call your attention, gentlemen, to the fact that there is another species of chiseler in this country, who in my opinion is more odious than even the other, or at least equally so—the chiseler of the Government.

The effect of this bill, it seems to me, would be to establish a sort of a monopoly of chiseling. It would certainly cut out thousands of manufacturing units from any participation in Government patronage. The Government would undoubtedly have to pay more for the price than it gets from the limited few who would be favorably situated for taking these Government orders.

Just last week—and I am speaking out of my heart as a sort of a manufacturer myself. I am the chief executive of a small manufacturing establishment located in one of these towns, employing about 250 people. I will say to you that we are able to operate today only by reason of a Government order that we got last week. We were invited to bid on that order, and we were given about 10 days' notice. We were invited to bid and we bid, and we got the order. A great many others got part of the order. It was a very largę order. As a matter of fact, to be specific, it was woolen blankets. As a matter of fact, there was not a manufacturer in the country who could have handled the entire order. It was for more blankets than anyone could handle. Therefore, they were given an opportunity to bid on any part that each thought that he would be in a position to handle.

Mr. WALTER. How do the prices that you are paying now compare with those that you were paying during the time that the codes were in operation?

Mr. EDGERTON. The prices?
Mr. WALTER. The wages.
Mr. EDGERTON. The wages and our wages are exactly the same.

Mr. WALTER. Then, why are you complaining? How would you be affected ?

Mr. EDGERTON. That is what I am trying to explain. We are conforming to all of the conditions of that code save one, and that is with reference to paying apprentices. Our code required paying apprentices, untrained people, who were there for the purpose of trying to learn to produce something, exactly the same as an employee who had been working there all of his life.

That is the only condition of the code with which we are not now complying. We do not pay them as much.

Mr. HEALEY. How much do you pay them!

Mr. EDGERTON. How much do we pay them? We pay them, I think, $2 a day, 5 days a week.

Mr. RAMSAY. Is it not true that the real objection of your association is that the N. R. A. destroyed part of your differential in the South as to wages compared to those paid in the North? That is why you are really objecting to the N. R. A.?

yes, sir.

Mr. EDGERTON. That is one of the chief objections, I should say;

Mr. Ramsay. I believe you were down at the meeting. Is it not true that you invited the Congressmen there at the Southern States Society that night?

Mr. EDGERTON. Yes.

Mr. RAMSAY. And lambasted the President, Congress, and everybody else?

Mr. EDGERTON. No, sir. I complimented him highly for a great speech he made once.

Mr. RAMSAY. You heard a lumberman there, I believe, state that he denounced the code because it had raised the wages from 81,2 cents an hour to 26 cents. Is that right?

Mr. EDGERTON. I don't recall.
Mr. RAMSAY. You don't recall that?

Mr. EDGERTON. I recall a lumberman speaking, but I was not analyzing what he was saying as he was going along. I was thinking about something else. Of course, he was speaking on his own authority.

Mr. Ramsay. Do you think that our lumber people up here can stand for any differential of that difference, 81/2 cents an hour to 40 or 50 cents an hour?

Mr. EDGERTON. I understand that a lumberman is to follow me, or one sometime during this hearing. I would suggest that he is more familiar with the conditions in the lumber industry than I, and he can answer you more intelligently and satisfactorily than I

can.

Mr. Ramsay. How many hours do your men work on these blankets? What are your hours now?

Mr. EDGERTON. Our hours are 40 hours.
Mr. RAMSAY. Forty hours a week?
Mr. EDGERTON. Forty hours a week.

Mr. RAMSAY. And how much a day? What is your average wage?

Mr. EDGERTON. I cannot tell you that. I know that our minimum wage is the code wage. How it runs on up and what it averages out I do not know.

Mr. Ramsay. What is your average wage for your journeymen? Mr. EDGERTON. How is that?

Mr. Ramsay. For your journeymen, what do you pay? What is your average wage? You ought to know that?

Mr. EDGERTON. For all employees in the plant?
Mr. Ramsay. Your journeymen? What do you pay them?

Mr. EDGERTON. You mean these apprentices that I was talking about?

Mr. RAMSAY. I don't mean apprentices; I mean men who have learned the trade.

Mr. EDGERTON. Oh, men who have learned the trade? I cannot tell you what that is. The minimum is $13 a week, and from there up, but I have not thought to calculate it. Mr. RAMSAY. Well, how far up? Mr. EDGERTON. On up through foreman, up to $40 a week.

I am

Mr. RAMSAY. Men that work in the plant, not the foremen, how much average wage? Or the highest wage? What is your highest wage?

Mr. EDGERTON. I can't tell you that.
Mr. RAMSAY. You are operating the plant ?

Mr. EDGERTON. Yes; but I am not there every day in touch with those details. I am away from there more than I am there. not the manager. I am the chief executive but not the manager. Those are details that I do not go into and I did not know that I came here for that.

Senator Walsh. May I ask one question, Mr. Chairman?

Mr. WALTER. What percentage of this group that you represent bid with the Government?

Mr. EDGERTON. I can't answer that. I am sorry; I can't. I don't know. But I know that a good many of them—I would not attempt to say.

Mr. WALTER. What experience of the entire business done by this group is with the Government?

Mr. EDGERTON. I don't know. I don't know. Senator Walsh. My only purpose is to try to be helpful, Mr. Chairman. I understand you are now living up to the code so far as minimum wages and hours are concerned ?

Mr. EDGERTON. Yes, sir. Senator Walsh. Had your blanket contract been made prior to May 26, you would have solemnly had to agree with the Government that you were complying with all these labor terms!

Mr. EDGERTON. Yes, sir. Senator Walsh. And other terms dealing with credit, dealing with administration, and dealing with other things?

Mr. EDGERTON. Yes, sir. Senator WALSH. Is that true? Mr. EDGERTON. Yes, sir. Senator Walsh. How are you affected by this bill ? Mr. EDGERTON. I will tell you exactly. If this law had been in effect we would never have made a bid on that order to start with, notwithstanding the fact that we were complying. But in the making of a woolen blanket and the packing of it and getting it ready to ship, there are over, I should say, 50 different articles that are used. It would have been necessary for us, as I see it, if we made a bid in good faith with the intention of carrying it out, to have tried to find out whether that manufacturer of labels up in New England was living up to the Government contract or not, or whether he was living up to these specifications or not, and against his prices on labels under those conditions.

We would have had to do that with respect to everything else that entered into the making of that blanket, according to my understanding of this bill. I think for the time we had conducted for that investigation the opportunity for the bid would have passed.

At the price, we might have discovered—the markets are constantly changing—might have discovered from day to day, although this wool dealer in Boston was not a chiseler and would be able to furnish us wool, we might find after we made our contract with the Government that we could get wool cheaper somewhere else; we could not buy wool from him at all; we would have to start the investigation all over again.

Senator Walsh. The bill does not apply to agricultural products.

Mr. EDGERTON. You would regard wool as an agricultural product?

Senator WALSH. Yes, sir.

Mr. EDGERTON. I would like to have that specified in the bill, because I have had to wrestle with our own State government on what an agricultural product is, and they have tried to impose taxes on the basis that it is not an agricultural product. That seems to be susceptible to interpretation.

But I was attempting to give that concrete illustration of what would seem to me to be the natural effect of this bill. I feel that comparatively few, if any-very few—of the smaller manufactures of this country, whether they are in the South or North or whereand the most of them are in the rural areas of the country, the vast majority are in the rural areas of this country—and they are not in a position for the most part to be running down here to Washington and hiring lawyers to come down here to look after their trips, making trips across the country and spending all that money to protect their interests. That is one of the great costs that the small manufacturer of this country today is not prepared to bear in connection with legislation involving his interests. That was one of the great objections to N. R. A. They were constantly having hearings and filing exceptions and ordering people up here to Washington at a tremendous expense to try to look after their interests. But the small manufacturers are not in a position to do that and certainly not now, in our part of the country, where they have been going out of business by the dozens—by the dozens, both before and since N. R. A. ceased to operate, and we are operating in the hope that that is the thing that will soon stop and that our manufacturers in the smaller areas of this country, the smaller manufacturer of this country, will have an equal chance on this Government business, and I do not believe they will have anything like an equal chance under this law. The business of the Government would drift into the hands of the few who would be in a position, whether they took advantage of it or not, to chisel the Government far more than any of the others have ever chiseled any of the employers of this country.

The CHAIRMAN. Your 15 minutes is up, but you have been interrupted a little bit.

Mr. EDGERTON. That is all right. That is about the substance of what I want to say, Mr. Chairman.

The CHAIRMAN. We could squeeze you out a couple of more minutes if you want it.

Mr. EDGERTON. I don't know as I think of anything at the moment. I would like to say, I am sure if I had those two minutes to think I could have thought of a good deal more to say.

The CHAIRMAN. Well, you made a good speech. Maybe you better stop before you spoil it.

STATEMENT OF R. C. FULBRIGHT, HOUSTON, TEX.

Mr. FULBRIGHT. Mr. Chairman and gentlemen of the Committee, my name is R. C. Fulbright. I live at Houston, Tex. I appear here representing

(Discussion off the record as to time of recessing and reconvening.)

The CHAIRMAN. Go ahead, Mr. Fulbright. When we adjourn this evening we will adjourn to meet at 10 o'clock tomorrow morning.

Mr. FULBRIGHT. I appear here representing certain lumber and cotton interests. First I desire to say just a few words with respect to the Cotton Merchants Association and the groups of cotton-handling associations with respect to the exemption in section 12 of the bill before you for consideraion.

Section 12 provides that the act shall not apply to agricultural or farm products processed for first sale by the original producer, nor to loans made by governmental agencies to associations of producers such as the cooperative associations.

We have no objection to the provisions of section 12 with that exemption, but we do respectfully urge that this committee make that exemption apply to farm products generally, at least to cotton generally, as we are only interested in cotton.

In the first place, your cotton processed for the first time may be the cotton that is ginned. We do not know what that means. It may not even be ginned by the original producer. The original producer does not process cotton generally except to have it ginned.

The CHAIRMAN. You think taking the seed out and bailing it may be processing?

Mr. FULBRIGHT. That is about the only way the original producer would ever process cotton that I can see.

Mr. CHANDLER. It certainly is ginned for the first sale.

Mr. FULBRIGHT. Yes. In the second place, that cotton must be carried through compress operations, it must be stored, and today something over 5 millions of the cotton in this country, the great bulk of it, either belongs to the Government or the Government has 12-cent loans on it, which amounts to the same thing, as you cannot sell it for 12 cents.

Mr. CHANDLER. Mr. Fulbright, right there, that cotton that the Government owns or has a 12-cent loan on is stored in warehouses. Do you understand that the warehouses now would have to meet the requirements of this law?

Mr. FULBRIGHT. Not only the warehouses but the persons that supply the material or product for the warehouses, everything that they use.

Now bear in mind that the National Industrial Recovery Act did not apply to the farmers, the production of agricultural products.

Senator Walsh. Pardon me; that is why it was not in the original bill, because it did not apply to the farmers and it was assumed that the President would apply the same Executive order to this bill, using the latitude granted him in section 6. This amendment was put in on the floor of the Senate.

Mr. FULBRIGHT. We have no objection whatever to the amendment, but the point we make is that to single out the cooperatives who are

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