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

yes, sir.

can.

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, 812 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

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.

wage?

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

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. I am 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 engaged in the sale of cotton in all the markets of the world and give them the exemptions on it and leave the cotton merchants and the cotton handlers subject to it creates an undue preference and discrimination between the competing classes.

The CHAIRMAN. You take the position that probably if the merchant should tender a bale of cotton, for instance, to a manufacturer who was producing something for the Government, somewhere down the line there would have to be a check-up to see whether or not, in the making of the ties and bagging and the operation of the compress and gin, the requirements of the Government were complied with?

Mr. FULBRIGHT. Yes, and I will go further than that. For example, we have the Export and Import Bank, an institution owned by the Government, formed during this period for the very laudible purpose of encouraging and assisting in financing exports of our surplus commodities. This is available to us cotton merchants and cotton cooperatives, and we have been selling in the various European countries. Through the activities of the bank we are greatly facilitated in doing it. It is a splendid thing.

Now the cooperatives may avail themselves of that, and yet when the cotton merchant goes to avail himself of that he has to go back and find out whether that cotton was produced by somebody who complied with the code or whether the bagging was produced by someone who complied with the code. There is a minfest discrimination there. It seems to me that the matter is so obvious that if you are going to exclude the farm products you have to exclude the handler or the merchant dealing with the farm products and you have done that with the associations of producers, who, by the way, have their own merchandising organizations and they are day to day in competition with the other merchants.

I have therefore suggested an amendment here which I believe would be broad enough to comprehend all that is in the section, which, if the committee thinks otherwise, may simply be submitted as an addition to section 12. I will read it and submit a copy to the reporter.

Nothing in this act shall be construed to apply to any contract for the purchase, financing, or handling of agricultural or farm commodities or the products thereof in such form as they are customarily marketed, or to loans made to those engaged in the marketing or handling of such commodities or products.

It is my opinion that that langauge is broad enough to include any cooperatives, but if the committee does not think so they may simply add the langauge to the language of section 12 as it now is.

Senator WALSH. I don't think there is any objection to that, according to the reading of the amendment. The only purpose is to reach the processes of the manufacturers and not to affect the producer.

Mr. FULBRIGHT. I thank the Senator. I may say that I had informally discussed this with the Chairman of the House Committee on Agriculture, and he expressed himself as thinking that it would be desirable.

Mr. DUFFEY (New York). Is that offered as a substitute?

Mr. FULBRIGHT. I think it is sufficiently broad to be a substitute. The committee may judge of that.

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