Calendar No. 381 74TH CONGRESS REPORT SENATE 1st Session No. 367, Part 2 THIRTY-HOUR WORK WEEK MINORITY VIEWS OF THE COMMITTEE ON THE JUDICIARY TO ACCOMPANY S. 87 A BILL TO PREVENT THE SHIPMENT IN INTERSTATE COM- MERCE OF CERTAIN ARTICLES AND COMMODITIES, IN CONNECTION WITH WHICH PERSONS ARE EMPLOYED MORE THAN FIVE DAYS PER WEEK OR SIX HOURS PER DAY, AND PRESCRIBING CERTAIN CONDITIONS WITH RESPECT TO PURCHASES AND LOANS BY THE UNITED STATES, AND CODES, AGREEMENTS, AND LICENSES UNDER THE NATIONAL INDUSTRIAL RECOVERY ACT SUBMITTED BY MR. AUSTIN MARCH 13 (calendar day, MARCH 29), 1935.—Ordered to be printed UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON: 1935 CONTENTS Analysis of S. 87— 1. Conflicts with laws of nature and economics......... Economists Code authority members....... ------ Agriculture ------------------------------ Perishable goods.. -------------------------------------- Millers and food manufacturers...........— Retailers ------------------------------ Durable goods industries... Mines----------------------------------... Automotive industries. Manufactures ---------------------------------------- Consumers’ goods. Chemical industry. Trucking. -----------------........------ Publishers and editors....... Exports and imports.... What would help workers...... 2. Incompatible with a free government.......... Labor loses liberty and right of self-government......... Labor loses equality of governmental treatment.... All-powerful boycotting system” Right to work and maintain independence destroyed........ 3. Exercises powers not vested in Congress.. Creates statutory monopoly of labor....... Transforms lawful acts into crimes.......... Imposes unusual punishments, embargoes, boycotts, forfeitures, impairment of contracts, fines, and imprisonments........ Usurps States rights.. Decisions: N. R. A. limitations void Protecting independence of States......... 21, 24 Production, Congress no jurisdiction........ Commerce preexisted Constitution. Manufacturing, mining, not commerce.......... Commodities described cannot be excluded.............. Due process clause violated.......... Conclusion --------------------------.............. III Page 25 Calendar No. 381 REPr. 367 SENATE 74TH CONGRESS Part 2 Ist Session en THIRTY-HOUR WORK WEEK MARCH 13 (calendar day, MARCH 29), 1935.—Ordered to be printed Mr. AUSTIN, from the Committee on the Judiciary, submitted the following MINORITY REPORT (To accompany S. 87) The undersigned have reached the conclusion that S. 87 should not pass because: 1. It is in conflict with laws of nature and of economics; 2. It is incompatible with a free government; 3. It attempts to exercise powers not vested in Congress. Briefly analyzed, the purpose of the bill is to control labor to the extent of limiting the sale of services to not more than 5 days in any week, or to not more than 6 hours in any day. he scope of the bill includes employees (except officers, executives,, and superintendents and their personal and immediate clerical assistants) of any person producing or manufacturing goods in any mine, quarry, mill, cannery, workshop, factory, or manufacturing establishment, situated in the United States. The author of the bill, Senator Black, testified that the bill contem plates the exclusion of agriculture (hearings, p. 14). Nevertheless, the bill includes employees of all producers of agricultural or farm products save those producers who are the original producers and who process for the first sale (sec. 7 (b) p. 6). Senator Black also stated that it included the publishing business the original bill having excluded that business by name and this bill having eliminated that exclusion (hearings, pp. 9-10). An exemption permit with respect to the foregoing class of em- ployees may be granted to “such persons, relieving the employer from the provisions of this Act with reference to such persons (bill, p. 3, lines 15-16.) Such persons” are those who are found by the Secretary of Labor upon satisfactory proof of the existence of special conditions in any industry to be necessary to be employed beyond the statutory limit. Industries are not exempted. THIRTY-HOUR WORK WEEK 2 Subject to the exception above stated, the scope of the bill includes the following: Employees of vendors of articles or commodities sold to the United States or to any department or organization thereof. The ramifica- tions of this phase of the bill reach food, clothing, drugs, toilet articles, paper, paint, bedding, house furniture and furnishings, vehicles, military and naval equipment, construction materials, books, maga- zines, newspapers, office supplies, tools, fuel, and other articles and commodities too numerous to specify herein (sec. 2 (a), p. 3). Employees of any materialman who sells to any contractor for any public work (sec. 2 (b)). Employees of any borrower from any governmental agency who is engaged in the production and manufacturing described in the first section (sec. 3 (a), (b)). Employees of every person who is under a code of fair competition, agreement and license under title I of the National Industrial Re- covery Act (sec. 4 (a), p. 5). The enforcement provisions of the act are unusual: An embargo on transportation in interstate and foreign commerce affecting the shipper, the transporter, and the deliverer. That no article or commodity shall be shipped, transported, or delivered in interstate or foreign commerce, which was produced or manufactured in- any of the establishments described in section 1- which any person- that is to say in which even one person¬ was employed more than 5 days in any week or more than 6 hours in any * * * day: (Sec. 1, p. 3.) A boycott: SEc. 2. (a) No article or commodity shall be purchased by the United States, or any department or organization thereof, from any business enterprise operat- ing contrary to any provision of this Act A limitation of the right to contract: (b) Each contract made with a contractor for any public work shall contain a provision that the contractor will buy no article or commodity to use on or in any public work from any business enterprise violating any of the terms or pro- visions of this Act Disqualification to borrow of any governmental agency: Sec. 3. (a) No governmental agency shall make or renew any loan to any em- in which any person (even one person)* ployer of labor * was employed more than five days in any week or more than six hours in any day. Another limitation of the right to contract: Sec. 3. (b) On and after the effective date of this Act, any such employer of labor who applies for a loan from any such governmental agency shall agree at the time of making application for such loan that so long as he is indebted to the * to work more United States he will not permit any person, except than * * Forfeiture: In the event that there is a violation by any such employer of his agreement, * shall be immedi¬ the full amount of the unpaid principal of the loan ately payable. THIRTY-HOUR WORK WEEK Impairment of contracts: Another violation enforcement provision consists of the arbitrary changing of the essential and vital element of labor provisions contained in all the codes. These were voluntary agreements. SEc. 4. (a) On and after the date this Act takes effect, every code of fair * * * shall contain a condition that the competition, agreement, and license employers covered by such code * * * shall not employ any person, except * * * more than five days, etc. * * * heretofore approved * * * shall be deemed (b) Every such code, to be amended so as to include a provision corresponding to that prescribed in subsection (a) of this section. Fine or imprisonment: SEc. 6. Anv person who violates any of the provisions of this Act, or who fails to comply with any of its requirements, shall upon conviction thereof, be fined not less than 8200, or be imprisoned for not more than three months, or both. This penalty runs against others than employers and employees; it strikes shippers, carriers, and deliverers who may or may not know that they are violating the act. All of the foregoing enforcement provisions reach the employee indirectly and tend to curtail his liberty to work and to earn money. The compensation of employees is frozen by section 5, at the pres- ent “daily, weekly, or monthly wage rate.”, unless a change is made according to the bill. The change intended is obviously a reduction, for the bill provides: SEc. 5. On and after the date this Act takes effect, it shall be unlawful for any employer subject to any of the provisions of this Act to reduce, directly indirectly, the daily, weekly, or monthly wage rate in effect on such date with respect to any 00 even one¬ of his employees until a reasonable opportunity has been afforded to his employees, through representatives of their own choosing by a majority vote, to meet with the employer or his representatives and to discuss and consider fully all questions which may arise in connection with the reduction of such wage rate. The obvious discrimination forced upon employees in divers indus- tries varies between those running on the 30-hour, 40-hour, and 50- hour per week basis at the present time, and between those operating under sectional and seasonal differences. 1. Irisiоаииr wии tHLS or NTRen o ECooIS Leaders of thought in economics whose interest is general, opposed the bill, testifying, among other things, as follows: Harold G. Moulton, Brookings Institution, Washington, D. C. (hearings, p. 166): At page 177: Our conclusion simply is that this measure will not only not accomplish any¬ thing for the laborers themselves, those now on the pay rolls, but that it will tend to defeat the very purpose which labor ought to be interested in. Wallace B. Donham, dean of the Graduate School of Business Ad- ministration of Harvard University (hearings, p 165): Advances in labor cost would advance prices and cut profits which are alreadv dangerously low. Advancing prices at the expense of consumers would check buying and create more unemployment. It would run up the cost of living. It would set us back from our goal of a better balance between agricultural and other prices. Cutting profits would remove the leading incentive to hiring more men. THIRTY-HOUR WORK WEEK O. G. Saxon, professor, Yale University, Sheffield scientific school course, “Business operation and relations ; law school course. “Mar¬ keting” (hearings, p. 180): At page 180: * * * To adopt it now would mean more rather than less unemployment, less rather than more real wages, and in the long run longer rather than shorter hours for many people, and a lower, not a higher, standard of living for all. At page 190: Commenting on the 30-hour week, the National Industrial Conference Board study says: At page 191: The result would be: For the employed worker, reduced hours, increased hourly earnings, stationary money income per week, and increased cost of living. For the manufacturer, smaller output per man-hour, increased labor costs per man-hour, increased material costs, and a larger increase in labor costs per unit of product. At page 194: The Brookings Institute says: It should be clear*** that a 30-hour week would involve a simultaneous increase in wage rates and a decrease in productive efficiency. The volume output would be declining at the same time that the payment of wages was increasing. This would result in either bankrupting business or in a rise in prices more rapid than expansion in pay rolls. If the former alternative resulted, we obviously would not have recovery, but rather intensified depression. In the latter alterna- tive the rapid advance in prices would nullify the increased money wages. Wilford I. King, professor of economics, School of Commerce, New York University (hearings, p. 336): At page 337: Unemployment, then, is nothing more or less than the relationship existing between the holding price of the laborer for his labor and the world price at which the supply of labor will be demanded. At page 340: * * * You can have your choice; you can have flexible prices with stable production and full employment, or you can have rigid prices with flexible pro¬ duction and much unemployment. At page 342: * * * If an attempt is made to compel the employer to pay the same wage rate for a 30-hour week as he is now paying for a 40- or 44-hour week, it evidently increases his cost per piece or per article. According to the law of supply and demand, if the cost is increased, he will sell fewer units of the product. That is exactly what has been happening during the last year and a half under the restrictions which have been imposed upon industry. At page 349: When the Government began to put restrictions upon industry, that rapid rise ceased. As soon as the Government began to put restrictions on hours of labor, those restrictions tended to offset the effects of the increasing price level. When we pay out relief in great quantities, that procedure also helps to keep more rigid the wage rates, so that they cannot be adjusted to new levels. There has been no adequate downward adjustment of wage rates. The restrictionists did every- thing they couid, as I see it, to prevent recovery. THIRTY-HOUR WORK WEEK Gus W. Dyer, Vanderbilt University, Nashville, Tenn., representing the Southern Industrial Council (hearings, p. 350): At page 351: * * * The proposed law would bring an unusual hardship on the small industries and on small business concerns in general. ** * To put a burden of 33½-percent extra wage cost on a small factory that has no'reserve, has limited credit, would practically make it impossible to continue in business. * * This bill prohibits men who could support themselves, if free, from accepting employment that would enable them to take care of themselves and preserve their independence. Fred H. Clausen, director of the Chamber of the Commerce of the United States (hearings, p. 433): At page 434: * * * We cannot establish wage rates by Government fiat that are not earned and recovered by the employer who pays them. The wage fund must come from gross income, and not from capital. To the worker, it (the 30-hour bill) says that under the American law you cannot work for others more than 30 hours a week. It definitely limits his earn- ing power without any relation to his health or the betterment of his economic position. Frankly, the program designed to create scarcity of labor will in itself effect increased scarcity of work and not of workers. At page 437: * * * This proposed law will reduce and not increase man-hour employment- At page 438: * * * One of the most objectionable features is the lack of flexibility. Neil Carothers, professor of the College of Business Administration at Lehigh University, as quoted by Professor Saxon (hearings, 183, and exhibits, p. 883). At page 183: This fundamental truth that you cannot help labor by reducing production is the basic fact in this 30-hour-week matter. If the average work week in normal times is 44 hours, then the national dividend is simply the product of 44 hours of labor applied to our land and capital. Cut this work week to 22 hours and you destroy the American standard of living: At page 883 (exhibit): * * * Cut it again to 11 hours and our civilization disappears. Cut it once more to 5½ hours and death sweeps away the population. But, you say this is a proposal to cut to 30 hours. Exactly. It will have the same starvation tendency, but it will not go so far. M. H. Reymond, industrial engineer, representing only himself, the average citizen” (hearings, p. 263): At page 265: *** The principal result of inflating costs, under such circumstances is to close down more businesses and make the unemployment situation worse than it otherwise would have been. At page 266: * * * To the extent that this bill contemplates higher wages per hour, it would cause lower wages per week by forcing a further contraction of business enterprise, or, what amounts to the same thing, by preventing a normal reexpan- sion of business enterprise. To the extent that this bill may contemplate reducing THIRTY-HOUR WORK WEEK hours without raising wages per hour, it would involve a lower standard of living, being in effect a bill for placing the entire burden of unemployment relief upon workers who now have jobs, which I am sure is not the intention. submit that no matter how it is interpreted, the present 30-hour-week bill would actually retard recovery from unemployment and actually reduce the standard of living of labor. * * I believe that our first concern should be to cure the existing unem¬ ployment, which requires either reducing costs, until these are again in balance with existing prices, or increasing prices until these are again in balance with existing costs. Victor Selden Clark, consultant in economics of the Library of Congress; paper on “Machines and Employment in History” read before the convention of American Historical Society, held in Wash- ington, D. C., December 1934 (hearings, p. 303): At page 303: Poverty and enforced or habitual idleness are therefore an ancient evil. They are We do not know positively not peculiar to what we call our “industrial system. whether that evil has been aggravated or the reverse by the advent of machines. At page 307: Distrust of the machine may be instinctive in the human race. “In the sweat of thy face shalt thou eat bread” still seems to some an ethical injunction. We need have no fear, however, that the human race will ever entirely escape that beneficent fate. Machinery may take over the task of physical production even beyond the prophecies of those who threaten us with a disastrously mechanized civilization. But our wants are protean. In all likelihood they will continue to outstrip the possibilities of the machine in the future as they have in the past, and our hands will never be idle for lack of useful things to do. ANOTHER DISTINCT CLASS OF WITNESSES OPPOSING THE BILL CONSISTED OF THE FOLLOWING MEMBERS OF CODE AUTHORITY, OR OF THE IN- DUSTRIAL ADVISORY BOARD OF N. R. A. AT ONE TIME OR ANOTHER Ralph E. Flanders, president, Jones & Lamson Machine Co., Springfield, Vt., member of the Industrial Advisory Board of the National Recovery Administration from November 1933 to March 1934 (hearings, p. 388). This witness was a sufficiently reliable authority to be cited by the author of the bill (hearings, p. 8) and by the expert witness called in rebuttal, W. Jett Lauck, who characterized the witness as one of the foremost men in his profession” (hearings, p. 448): At page 389: * * * A recovery, to be real, must be expressed in terms of an increase in the production and distribution of goods and services. A further shortening of hours cannot possibly produce such an increase; a further shortening would obviously produce a decrease. It would be a deathblow to recovery. At page 390: A general raising of hourly wage rates at this time will be reflected in raised * * * prices for goods and services. As a matter of fact, we have had price rises which ate up wage increases, thus preventing an increase in demand from the workers. * * * The attempt at an artificial balancing of price and wage changes leaves large blocks of purchasing power with a net loss, salaried men, for instance, * * and farmer * * * There is nothing in this to give any encouragement to recovery in the industries where recovery is most needed. The capital-goods industries can only be revived by the hope of profit in the industries they serve. Until that revives, the remaining mass of unemployment will continue to distress those who suffer under it, and to perplex and concern the rest of us. THIRTY-HOUR WORK WEEK At page 391: An understanding of the profit system shows that its success in serving the mass of people depends on profit. To permit the recovery of business, the in- crease of employment, the expansion of purchasing power, the broader produc- tion and distribution of goods, there must be a reasonable hope of profit. We can stabilize on any level. We sink to a low level if profit is threatened. The 30- hour week is a proposal to stabilize on a low level. The whole population rises to a higher level if business profit is not merely permitted, but encouraged, and if production is allowed to increase. At page 394: Summing up, the workers’ interests will be served by 1. Abandonment of the wage and hours policy of bill S. 87. 2. Abandonment by labor of corresponding wage and hour policies which retard recovery and reemployment. 3. Abandonment by industry of the search for profit by way of less production and higher prices, and a return to normal profit and business expansion through increased production and lower prices. 4. Acceptance by business of overtime wage policies which will distribute an increased sum in wages as the demand for workers rises above the level of the 40 hours per week. 5. Active protection of true business profit by Government for the sake of reemployment, increased pay rolls, and increased governmental income. 6. Confining repressive measures to the limiting of profit from speculative inflation, which destroys purchasing power, produces unemployment, and gener- ates an unendurable burden of debt. Walter Mitchell, Jr., secretary of Code Authority of the Furniture Manufacturers’ Industry, Washington, D. C. (hearings, p. 118): At page 124: * * * It should be remembered that a 25-percent reduction in hours from the 40-hour base in most of the codes to the proposed 30-hour base constitutes a 33-percent increase in the hourly wage rate At page 125: * * * The real reason why industry wants flexibility is that equipment is geared in most industries to normal requirements. Seasonal peaks have always been absorbed by longer hours of operation, and slacks have been met by part- time operations. Permanent workers need the extra funds earned during these peaks in order to tide them over the slack period. Robert E. Wood, president Sears, Roebuck & Co., under consid- eration for adviser to the President on relief measures (p. 307): At page 307: In thelong-term view I think that perhaps my children will see a 30-hour week; just as we came down from 59 to 50 and from 50 to 48 and from 48 to 40, I think we will eventually see 30. We may see lower than that. But you are taking a terrible risk if you do this now. You are going too fast. You have got to wait until machine production is better than it is today. At page 308: I am opposing this bill not from the standpoint of my own firm. If other merchants go to 30 hours I can go to 30 hours and hold my end up, but I am oppos¬ ing it from the standpoint of the citizens and what I think will endanger my customers. At page 309: Neither is there any reason to believe that reduction from the present 8-hour day for 5 days per week, to a 6-hour day for 5 days, would result in any material increase in efficiency by the individual worker. At page 310: As a practical business man, a merchant who comes into direct and intimate contact with the buying public, the thing that gives me the greatest concern in this 30-hour-week proposal is the practical certainty that it would result in a THIRTY-HOUR WORK WEEK tremendous buyers’ strike. This would, of course, be followed by a closing of factories and the discharge of employees. In my opinion, the net effect of adopt- ing the Black bill would be that within 6 months we would find fewer people at work than today. The statements of a prominent labor leader before this committee to the effect that the adoption of the 30-hour week would raise prices only 3 to 3½ percent, despite the 33½ percent theoretical rise in labor costs involved in most industries, will hardly be taken seriously by this committee, I trust. Other data in that same statement completely refute that assertion. This very serious error results from the fact that they have inadvertently computed the increased labor cost on only one step in the process of transforming the raw material into the finished product sold and delivered to a point where the consumer can use it. Robert West, Danville, Va., representing the Cotton Textile Code Authority (hearings, p. 416): At page 417: ** * * The inflexible and arbitrary provision for a maximum 6-hour day and a maximum 30-hour week permitted to be worked, is not the answer to the problem of unemployment, and if made a law, will quite likely work incalculable harm to those already engaged in gainful occupation, with very little, if any, (compensation advantage to the unemployed. At page 420: * * * Basically, the bill proposes to penalize 6,500,000 wage earners in the manufacturing industries for the possibility of reemploying the 700,000 during * * the hours given up by the 6,500,000. * * * The bill necessitates an increase in labor costs of 33½ percent, which must be passed on to the consuming public since no earnings have been available to absorb this increase in costs. Furthermore, the bill necessitates a singularly futile increase in costs because those who cause this increase do not receive an increase in their own income. At page 422: * * * This is not a bill to relieve unemployment to any great extent, but rather a bill which will result in decreasing production and limiting the individual workman’s capacity to earn. The net effect of the efforts of Government industry, labor and agriculture for shorter hours, higher hourly rates, and curtailment in production of foodstuffs is making itself manifest in the form of rising prices of what the workman has to buy. This proposal to further reduce the maximum hours permitted to be worked means higher costs and prices with no increase in the ability to pay. While it is the hourly rate that determines cost of manufacturing, it is the weekly pay envelop which pays the butcher and the grocery man, but the value to the worker of that pay envelop is dependent on the prices he has to pay. The cur- rent proposal for the shorter work week forestalls the opportunity of providing the necessary income because it raises costs without providing a compensating It accelerates increase in income to meet the rising prices occasioned. the necessity of expenditure and deprives him of his opportunity to earn more At page 423: There is a rising remonstrance on the part of wage earners at arbitrary measures which restrict their ability to cope with the rising costs of living. Every proposal seems destined to raise the price of what the worker has to buy, at the same time ** * The bill will aggra¬ fettering his opportunity to increase his income. vate the difficulty. Ward Cheney, chairman Code Authority for the Velvet Industry (hearings, p. 467): At page 467: * * * We are faced with the problem of being able to run mills at peak production during only 3 months. THIRTY-HOUR WORK WEEK At page 468: It would be difficult to establish an increased shift to occupy looms with the available skill. George H. Williams, chairman Code Authority, Candy Manufac- turing Industry (hearings, p. 329): At page 329: A 30-hour-work week applied to the candy manufacturing industry would cause: (1) Reduction in employment. (2) elimination of many of the smaller units now operating in the smaller cities and towns, and (3) transfer of business from the smaller to the larger units of the industry AGRICULTURE WOULD BEAR A LARGE PART OF THE BURDEN OF THE COST AND PRODUCERS OF AGRICULTURAL PRODUCTS AND OTHER PERISHABLE GOODS WOULD BE UNABLE TO CONFORM TO THE LAW, ACCORDING TO THE FOLLOWING WITNESSES Mr. Flanders (supra) at page 390: * * * This bill, if enacted, will in fact destroy the progress which the farmer has made hitherto in coming into balance with the industrial population. Mr. Wood (supra) at page 308: * * * I think you will see that this bill will cause quite an economic upset and I can see every time the relation between farm and city gets out of proportion how your farm buying drops down, and that throws the factory worker out of employment. J. F. Kolb, director of industrial relations, National Metal Trades Association (hearings, p. 324): At page 325: Our 30,000,000 farm population would be confronted with higher prices for all commodities purchased. This increase in the disparity between the prices of manufactured products and agricultural products would seriously affect sales of manufactured products as well as the farmer’s real earnings and no doubt ultimately would increase our unemployment burden. At page 326: It goes without saying that it is the duty of the Nation to prevent want among the unemployed. But to seek this end by a compulsory reduction of the hours of work, which would freeze the possible volume of production below the level required to give all the people the abundance they desire, is as short-sighted as it is lacking in understanding. At page 437: *** increased labor expenses amounting to 33½ percent will be reflected in prices to farmers for their needed equipment that are 20 percent in excess of the present level. W. A. Wentworth, secretary dairy industry committee, composed of representatives from International Association of Milk Dealers, International Association of Ice Cream Manufacturers, American Association of Creamery Butter Manufacturers, National Cheese Institute, Evaporated Milk Association, and Dry Milk Institute (hearings, p. 398): At page 400: The establishments engaged in this industry number as follows: Fluid-milk distribution, 55,000, of which 8,400 are dealers in pasteurized milk and 46,600 are producers engaged in processing for first sale. There are 4,505 butter- manufacturing plants, 3,432 cheese-manufacturing plants, 3,702 ice-cream- manufacturing plants, and 460 evaporated- and dry-milk-manufacturing plants. THIRTY-HOUR WORK WEEK 10 At page 401: * * * Milk is produced by 26,062,000 dairy cows, distributed in all of the States. At page 402: In the fluid-milk industry 22 percent of the total sales dollar went into pay roll in 1929 while in 1933 it had increased to 29 percent. In the other branches of the industry approximately the same increase prevails with the figures ranging from 25 to 32 percent of the sales dollar at the present time. At page 403: A 30-hour week or a 6-hour day or even the provisions of section 1 which author- izes the Secretary of Labor to issue exemptions would place upon an administra¬- tive branch of the Government the practical necessity of waiving the provisions of the act or to impose a hardship and a discrimination which would defeat the purposes of the act by throwing the handling of these products into the hands of producers who are exempt from the act or establishments which are engaged solely in intrastate business. At page 404: * * * To impose any additional cost upon this industry, which is almost a direct link between the farmer and the consumer, can only do one of two things. It would either increase the price to the consumer or decrease the price to the farmer. A. M. Loomis, representing the American Association of Creamery 11/0 Butter Manufacturers (hearings, p. 112): At page 113: A 30-hour week and a 6-hour day, we are convinced, cannot successfully be applied to these manufactured products, because of practical considerations which cannot be changed by law. When the milk and cream reach the creamery or cheese factory they must be promptly taken care of. They cannot be carried over until the next day, because at this stage deterioration is rapid. At page 114: * * * The products must be handled to a finish or they might spoil or be reduced from the grade or quality required for human consumption to a much less valuable product usable only for poultry or stock feed, involving heavy * losses. * * * No method is known to the industry that would overcome the com- pelling necessity of finishing each day’s operations on all of the produets on hand. * * * The handling of these products requires the utmost care, not only from the standpoint of quality but also from that of sanitation, and the pres¬ ervation of those important nourishing health-producing elements possessed by * butter and also by cheese At page 115: In connection with the proposed hour-limitation measure, the purpose of which is to increase employment and to establish double shifts, it is for me to show that this cannot be done with the dairy products I have described. * * * They (trained men) are not in existence in the numbers required to man the creameries and cheese factories with double shifts and to fulfill the re- sponsibilities connected with such work, which involves not alone economics but also human health, in preparing these important, highly perishable foods. (Referring to other testimony on the necessity of educated persons for this work.) At page 116: The phrase “the original producer” includes farmers who make their own butter and cheese on the farm but also farm cooperatives. The bill would create an extremely bad competitive THIRTY-HOUR WORK WEEK 11 situation between the farm cooperatives and the larger bulk of the industry Myrick D. Harding, representing the Illinois Manufacturers’ Asso- ciation, Meat Packing Industry (hearings, p. 136): This testimony tends to show the impossibility of making the pro- posed 30-hour week law conform to the laws of nature affecting perishable products. At page 136: We are very much like the canneries. When vegetables are ripe, they must be canned; when fruit is ripe, it must be canned. It is much the same way with our products. At page 137: The work is seasonal by seasons and seasonal by days of the week, At page 138: A table is shown of receipts of livestock at seven principal markets in November 1934 proving the irregularity of receipts and fluctuations in the necessity of labor. At page 139: The perishability of livestock and of fresh meat discussed. The necessity of prompt marketing as well as prompt slaughtering, packing, manufacturing, and refrigerating. At page 141: The injury repercusses upon the farmer because the meat-packing industry is really the marketing agent of the former. * * * It has long been conceded that the selling price of meats determines the price which the farmer receives for his livestock. The time elapsing between the purchase of the live animal and the sale of the finished product is so short as to be reflected back in the current buying price. It follows, therefore, that whatever expense a short working day would entail on the packing industry (and it would cost the industry as a whole many millions of dollars) would to that extent depress the prices paid the farmers for their livestock. At page 142: The bill would produce unfair competition and dis¬ crimination against the interstate packer and in favor of the intra- state packer. Limiting the outlet of livestock producers by restricting the operations of or closing interstate packing plants affects grain and hay farmers. At page 150: ** * Beef and mutton and pork commence to deteriorate the minute the animal is slaughtered. Deterioration sets in right away, and it is just a question of time until it gets to the point where you cannot eat it. At page 153: * * * We must have a flexible week. We must have elasticity. We simply cannot function in any other way. If we are to be put on a rigid week, it would simply mean that when that number of hours is up, bingo! We have to stop work. * * * For instance, in the manufacture of sausage, when a man starts on that job he must finish it. If a man starts to make a certain kind of sausage, he can’t stop in the middle any more than a baker can stop making dough and let somebody else take his place. * * * * They would not know how far the process had gone. At page 154: We have 36 weeks a year in which we cannot work more than 40 hours, 8 weeks in which we cannot work more than 48 hours, and 8 weeks in which we cannot work more than 53 hours. That was given us at that time for the same reasons that I am bringing up here, that we can’t operate on a rigid week. You see, we are not dealing in ingots of steel or metal, or anything of that kind. Our product is all perishable. We have a very large number of different processes through which our products must pass. THIRTY-HOUR WORK WEEK 12 Henry Stude, American Bakers Association (hearings, p. 480): At page 482: The rigidity of a 30-hour week would work a particular hardship on the baking industry. Baking is a domestic art. As such it is characterized by waiting time, by slow, careful handling of ingredients, by special skill—by a thousand and one baking peculiarities and delays. When the dough is once mixed it must go through its schedule of fermentation, proofing, baking, cooling. It cannot be stopped and started. It cannot be delayed or accelerated. The baking industry deals in a perishable food.** The baking industry consists of approximately 32,000 units. Between 20,000 and 25,000 are small local retail enterprises employing two or three people. Upon the passage of this bill these enterprises would immediately discharge their two or three employees, convert their business into family affairs, doing their own work, thus immediately defeat the purpose of the bill. AGRICULTURAL INJURY WOULD BE SUFFERED, ALSO, FROM THE RE¬ STRICTIVE EFFECTS OF THE LAW UPON MILLERS BECAUSE MILLING COMPANIES DEPEND LARGELY UPON THE PURCHASE OF GRAIN FROM THE FARMER The farmer’s hours are not and cannot be regulated. He brings in his wheat when convenient. Carl F. Dietz, the wheat-flour milling industry (hearings, p. 313): At page 317: * * * The movement is seasonal and usually for 2 to 3 months, or there- abouts, almost unlimited service is necessary. The rest of the year the elevator men, while on the job, have no really arduous tasks. It would be impossible to find men in these small communities with knowledge of wheat, grades, values, and binning for a few weeks’ work in the year. * * * That immediately affects the prices and it affects the purchases related to those particular areas. It varies very widely and very uncertainly. * * * Any restriction as to running time in a case of that sort would, of course, be disastrous. If we had a 30-hour week and a 6-hour day a man would be per- mitted to operate 5 days. That mill is called upon to operate for 6 and 7 days. It would have no way of operating. It cannot carry a stand-by crew in order to have it jump in and operate the sixth day. At page 316: A reduction to 30 hours maximum per week would make it utterly impossible in this industry for the operatives to actually get their 1,560 hours (in a year) and it would probably mean an average work week of 25 hours or less instead of 30. At page 319: We are trying to work to a 40-hour week, but the men are averaging more nearly 32 to 35 hours. The export business, as I have already indicated, is very much shrunken, and any further burden on the milling industry would just about seal its doom. There is no way we know of that we can possibly hope to compete with Canada and Australia if we have any further burdens put upon us. The inevitable result of reduced consumption (from higher cost and prices) would increase the number and use of wheat substitutes with a further unhappy effect upon the wheat farmer and the piling up of greater surpluses. The testimony of other millers to the probable deflection of con- sumption of food products to lower priced foods will be found- At page 326: G. W. Partridge, secretary, Association of Operative Millers, Kansas City. At page 327: Fred R. Rowe, the Michigan State Millers Association, Portland, Mich. THIRTY-HOUR WORK WEEK 13 Charles Wesley Dunn, Associated Grocery Manufacturers America, Inc. (hearings, p. 476): In addition to the direct injury to employees of manufacturers, wholesalers, and retailers of groceries the evidence tends to further show the injury reflected upon agri- culture. At page 477: * * * Moreover such wide-spread increases in prices will discourage buying by the general public and may, indeed, result in such general discontent with currently rising prices as to bring on a buyers’ strike. The food manufacturing industry and other industries engaged in the process- ing of agricultural products would suffer especially adverse effects if this bill were to become law. The Agricultural Adjustment Administration is bending every effort to bring about parity between the price the farmer receives for his product and the price he pays for the things he buys. The effect of the Black bill would be to offset in large measure the results thus far achieved, to necessi- tate higher processing taxes, and to increase the price the consumer must pay for food and clothing. The fundamental vice in this bill is that it seeks to cure unemployment by reducing production rather than increasing it, in the mistaken belief that pur- chasing power can thus be increased. The exact contrary is true. Mr. Wood (supra): As an incident of the depressive effect upon the retail business shown by the president of Sears, Roebuck & Co., the injury to farmers was illustrated as follows: At page 310. * * * We have seen numerous instances within the past 2 years where prices of an article have risen so fast as to run into a buyers’ strike. This was true in cotton goods last year. It was true of automobiles in the early months of 1934, and it has been true with numerous other specific items of merchandise. In such cases, prices have had to be forced down, even to the no-profit level, before goods could again be moved in volume. In our own case, selling largely to farmers, villagers, and workingmen, there would be no increase in income with which to buy these higher-priced goods. Farmers certainly would have no more money to spend because of the 30-hour law. On the contrary, the parity between agricultural prices and city prices, * * * would again be thrown out of balance and the interchange of goods disrupted. Villagers who depend mainly upon the farmer for their income would have less money to spend*** Rivers Peterson on behalf of the Retailers National Council (200,000 retail stores located in every State in the Union with an annual volume in excess of §10,000,000,000) (hearings, p. 443): The injury to the consumer was a special point of this testimony. (See table of probable increases in retail prices on p. 444. The difficulty, if not, indeed, impossibility of enforcement of such a law was pointed out at page 445, and the especial burden on the farmer is mentioned as follows: At page 444: * * * So they are necessarily going to pass this increased cost on to the consumer; and since a large part of that merchandise is purchased by the farming trade, we think perhaps it would fall especially heavy on them. Fixing the money wages at present rates, while cutting the hours of work, will amount to the same thing as establishing new and minimum wage rates. One of the inevitable results of such statutory action will be to freeze all weekly incomes at this new arbitrary level. The minimum rates will become the maxi¬ mum rates. Thus higher-grade employees will be penalized under this system. S. Rept. 367, 74-1—2 THIRTY-HOUR WORK WEEK 14 At page 445: * * * The retail codes have made provision for various work-weeks of from 40, 44, 48, to 56 hours and at the same time they have provided for a number of conditions and exemptions in which additional hours of certain classes of workers are needed in the retail trades. The Black bill provides no elasticity whatever. It drastically requires the adoption of a 30-hour-work week without regard to the wide differences in trading habits found throughout the country or to the wide differences necessary among the various trades and among stores differently situated among the various trades. * * * An increase in the failure rate of retail establishments would obvi- ously throw an increasing number of employees out of work. Such unemploy- ment would probably counterbalance any increase in employment among con- cerns still able to continue under its provisions. A. J. Hettinger, Jr., representing the Durable Goods Industries Committee (hearings, p. 423): At page 427: * * * This bill, if enacted, would ask the farmer, who finds it difficult to make a living on 60 hours of work a week, to support the industrial worker on 30 hours a week. THEILARGEST POOL OF UNEMPLOYMENT IS IN THE DURABLE-GOODS INDUSTRIES The evidence tends to show that the great depression in these industries woúld be frozen at the present levels if it were not made worse by the proposed 30-hour law. A. J. Hettinger, Jr., executive secretary of the Durable Goods Industries Committee (created at the express request of the United States Government) (hearings, p. 423): At page 424: This depression, now entering its sixth year, has become a durable-goods goods is 11 percent below that of depression. The production of consumers' 1929; but the output of durable goods, in spite of the outpouring of Public Works Administration expenditures by the billion, remains 47½ percent below the predepression totals. Put back to work those men who have produced the durable goods of this Nation and you have done more than reemploy the 4,874,000 jobless men who constitute the largest group of the idle. You have started to restore the ravages of the depression and to rebuild America. At page 427: The real indictment of this 30-hour bill is equally strong, whether based on social or economic consequences.*** » Written throughout the bill, though never specifically stated, is the blunt, tacit assumption that labor is a tangible, inanimate commodity, interchangeable as spare parts in a bank of machines, and capable of being shipped at commodity rates from one part of the country to another. This is a cruel and unreal assump¬ tion. Unless this bill, by some process of alchemy not yet known to man, can transform the idle freight-car builder from New York State into a skilled operative in a rayon plant in Tennessee, the worker in a cast-iron pipe factory in Birming- ham into a machinist in Cincinnati, or a sawmill operative into a chemical workei on the Atlantic seaboard, it fails in even the vital phase of the mere mechanics of reemployment. At page 428: The remedy to unemployment is not the Black 30-hour bill, which would Reemployment must be created where merely add a new series of dislocations. unemployment exists—and that is chiefly in the durable-goods industries. Du- rable goods are long-term commitments, involving heavy initial capital expendi¬ THIRTY-HOUR WORK WEEK 15 tures which can be recouped only by income derived through a period of years. The essence of such commitments is confidence extending beyond the immediate future. Without such confidence, stagnation in these industries is inevitable. The Black 30-hour bill would intensify the stagnation that exists today. It would vitiate such gains in durable-goods employment and production as will restore industrial equilibrium. Restored industrial equilibrium is vital to widened markets for agricultural products, and the achievement of equilibrium between agriculture and industry. Thus runs the sequence of reemployment and recovery At page 430: Present costs which have failed to move goods and to create employment must be reduced to levels that will move goods and provide employment. To that end industry is devoting its every effort. The 30-hour week simply will not provide labor in these industries with a decent living wage, and permit costs and prices at which buyers will purchase their products—it is the one sure way to achieve continued depression. At page 431: The conclusions of the report of the Committee to the President under date of May 14, 1934, are set forth at pages 431 and 432. The Black 30-hour bill meets none of what we believe to be the essentials of reemployment and sound recovery. J. F. Kolb, director of industrial relations, National Metal Trades Association (hearings, p. 324): At page 325t * * * The average American workman does not want a shorter working week; in fact, most of them are eager to work more hours than employers could supply, so their weekly pay checks would be adequate for family needs. On the contrary, we should emphasize that this country needs more production at lowei prices instead of less at higher prices, which would be the certain result of a sharp * * Effects upon various reduction of hours without reduced earnings.* economic classes (of the N. R. A. codes) indicate the workers’ real wages would be appreciably reduced by the rise in commodity prices which would compel adoption of a lower standard of living. If the 30-hour bill was applied indiscriminately to employees working 43 hours and others working 23 hours it would obviously be unfair to either or both so far as application of wage rates was involved. At page 326: Employment in industry is possible only as their products can be sold. Goods can be sold only on the basis of prices that create demand. The prices of products are based on costs, both direct and indirect, represented by labor in materials and supplies used in manufacture, because every manufacturer is a buyer, fabricator, and seller. The manufacturer must indemnify himself for these higher costs by charging higher prices. Present costs which have prevented sales and increased unemployment must be reduced so our products and prices will induce buying. The results of a 30-hour week with no increase or decrease in production of manufacturing industries probably would produce the following results: For the unemployed workers: Restoration to employment of some of their number, perhaps 20 to 30 percent. For the employed workers: Reduced hours, increased hourly earnings. Sta- Reduced real wage. tionary money income per week. Increased cost of living. Increased labor cost For the manufacturers: Smaller output per man-hour. per man-hour. Larger increase in labor cost per unit of product. Reduced sales. It goes without saying that it is the duty of the Nation to prevent want among the unemployed. But to seek this end by a compulsory reduction of the hours of work, which would freeze the possible volume of production below the level required to give all the people the abundance they desire, is as short-sighted as it is lacking in understanding. THIRTY-HOUR WORK WEEK 16 FOLLOWING WITNESSES GAVE TESTIMONY EQUALLY AS PROBATIVE AS THE FOREGOING TENDING TO SHOW THE DAMAGING EFFECT OF THE PROPOSED LAW UPON THE INDUSTRIES SET AGAINST THEIR NAMES Pages are stated for quick reference. At page 157: John D. Battle, executive secretary, National Coal Association, Bituminous Mining Industry. At page 362: Julian D. Conover, secretary, American Mining Congress. At page 368: Lewis C. Madiera, III, executive director, Anthracite Institute, Anthracite Producing Coal Industry. At page 370: W. L. Haehnlen, chairman of board of the Tonopah Mining Co. of Nevada. At page 371: A. E. Bendelari, president, Eagle-Picher Mining & Smelting Co., lead and zinc At page 372: Charles M. Seymour, metal miners and smelters, Tennessee, Missouri, Kansas, and Oklahoma. At page 385: Edward J. Harding, Associated General Contractors of America, Inc. At page 472: James L. Davidson, secretary, Alabama Mining Institute. At page 477: George J. Earl, Jr., New York and New Jersey branch of the National Metal Trades Association. At page 258: James W. Hook, president the Geometric Tool Co., New Haven, Conn. At page 381: Charles R. Hook, president the American Rolling Mill Co., Middletown, Ohio. At page 405: Walter S. Tower, secretary, American Iron and Steel Institute. AUTOMOBILE MANUFACTURERS AND OTHER MANUFACTURERS OF A GREAT VARIETY OF PRODUCTS EXPRESS THE OPINION THAT THE BILL COULD NOT BE ENFORCED; THAT IT WOULD BE DESTRUCTIVE OF LABOR, OF CAPITAL, AND OF LAND, USED IN THE BROAD SENSE OF MATERIALS They pointed to increased costs, increased prices, increased sales resistance, decreased market, reduced output and production, increased unemployment, reduced purchasing power, and increased real wages. They testified that it would tend to mediocrity and lower levels of skill and labor, block the movement of economic law, and bring a penalty for it; they pointed out that the bill ignores the strain that individual industries are now suffering, assumes that all separate industries are equally prosperous, and that they are competent to bear the extraordinary burden of reduced hours without reduced pay. Their testimony tends to show that the bill would not work as a relief measure because of its tendency to create idle industries and throw workmen upon relief rolls. Also, that it would not work as as a recovery measure because of its tendency to paralyze industry that is unable to find capital with which to carry the added load. The effect of their testimony was that the bill would lower the standard of living generally. 17 THIRTY-HOUR WORK WEEK We point to statements as follows: At page 298: Robert C. Graham, vice president of Graham-Paige Motors Corporation, representing the Automobile Manufacturers Association. At page 356: Jack E. G. Frost, assistant to the president of the National Automobile Dealers’ Association. At page 375: Sidney E. Cornelius, manager the Manufacturers Association of Hartford County, Hartford, Conn. At page 377: A. L. Viles, president and general manager of the Rubber Manufacturers Association, Inc. At page 461: F. C. Jones, president National Electrical Manufac- turers Association. At page 474: J. M. Manley, commissioner, Industrial Association of Cincinnati. At page 482: Manufacturers’ Association of Connecticut, Inc. At page 483: John W. O’Leary, president Machinery and Allied Products Institute. MANUFACTURERS OF BOXES AND OF TOYS TESTIFIED TO THE SAME GENERAL INCREASE IN LABOR COSTS OF 33½ PERCENT, AND TO PROBABLE REDUCTION IN THE VOLUME OF PRODUCTION At page 155: R. W. Darnell, Chicago Paper Box Manufacturers’ Association. At page 320: Norman G. Hough, president and general manager National Lime Association. At page 330: J. E. Cuff, vice president American Flyer Manufac- turing Co., a toy industry. At page 416: W. A. Coventry, president Toy Manufacturers of the United States of America, Inc. At page 466: C. D. Hudson, manager National Wooden Box Association. THE CONSUMERS-GOODS INDUSTRIES COMMITTEE SUBMITTED A BRIEF IN OPPOSITION TO THE BILL, TO BE FOUND AS FOLLOWS At page 409: Industries represented and list of dislocations, cost burdens, and other injuries. At page 410: Conditions varying widely between different indus- tries impossible to regulate by horizontal, universal rule. At page 411: Financial incapacity of industry to adjust itself to the 30-hour week. At page 412: Effects of price increase resulting from wage in- creases. At page 415: Would promote strikes. See also pamphlet by Roscoe C. Edlund, in behalf of the Consumers Goods Industries Committee. The Manufacturing Chemists’ Association, represented by James J. Riley, president Barium Reduction Corporation, South Charleston, W. Va. (hearings, p. 334): Developed the peculiar inability of this industry to comply with the 30-hour bill. At page 335: It is not feasible to maintain a sufficient staff or a sufficient inventory for any emergency. Many operations of the chemical industry are continuous and in a multitude of delicate chemical operations—such as finishing an obstinate nitro- THIRTY-HOUR WORK WEEK 18 glycerine charge—it is essential that a single skilled operator complete a given operation. The American Trucking Associations, Inc. (hearings, p. 468): Opposed the bill and asserted that it would protect an unfair competi- tive condition with rail and water carriers, as well as between em- ployers and those who own and operate their own trucks. PUBLISHERS' AND EDITORS' OPPOSITION TO THE BILL WAS PRESENTED AS FOLLOWS BHII. At page 439: Harry B. Rutledge, managing director National Edi¬ torial Association, also secretary of the Code Authority of the Graphic Arts Code ** * A recent survey made by the graphic arts coordinating committee shows only 35 percent of the towns reporting a sufficient number of skilled work- men to operate the local plants on a 30-hour basis. At page 440: The Graphic Arts Code presents an extremely compli- cated problem for its authorities owing to the classified wage scale, the differentials governed by both volume of business and population of the cities, as well as by the publication of a newspaper in the plant, and to place the entire printing industry on a 30-hour-week basis and try to make the required adjustments would hopelessly confuse code administration if not make it utterly impossible. It would plunge the industry into a chaos from which it would require years to recover. At page 441: * * * A 30-hour week under these conditions means smaller and poorer newspapers, with closing their office doors their only alternative. At page 252: Guy L. Harrington, National Publishers Association, (200 of the leading periodicals or magazines of the United States, hav- ing a total combined circulation of approximately 50,000,000 of indi- vidual copies monthly): At page 253: The immediate effect of this bill would be to suddenly increase costs to a point impossible of absorption. Many magazines would be placed on a losing basis, all unnecessary employees would be eliminated, and drastic attempts would be taken to speed up the output of those already employed. Those publishers who could not meet the increased cost would, if unable to negotiate loans, be forced into bankruptcy. At page 256: * * * There are certain operations in some branches of printing that would be impossible of performance under a 30-hour week. In many operations in printing as well as in industry in general, a 30-hour week would entail a large percentage increase in unproductive time. At page 258: A 30-hour week means a reduction of at least 40 percent, probably more, in our national production of the year 1929, which was then 8665 per capita. Would this Nation be self-sustaining on a per capita production of $400 per year? Obviously it would not if present living standards were maintained. Harder work, more work, longer hours, not shorter hours, increased production, saving and thrift only will lead to prosperity. Thus and thus only may we meet our obligations and become self-sustaining. Harvey J. Kelly, the American Newspaper Publishers’ Association (more than 400 publishers of daily newspapers throughout the United 19 THIRTY-HOUR WORK WEEK States) (hearings, p. 276): A strong argument was presented for special exemption of the newspaper-publishing industry based on the fact that it has the highest level of sustained employment experienced. At page 281: It should be remembered that a newspaper cannot, in the absence of revenue business, shut down like a manufacturing concern or a commercial print shop. A newspaper must serve its readers. It is like a train which must make its run whether or not it has revenue passengers aboard. At page 284: Here will be found a statement of restrictive rules and regulations of unions rendering it impossible to operate on a 6-hour basis because of inherent difficulties in regard to news and advertising. At page 285: The act would inevitably result in decreased employment in the newspaper¬ publishing industry. At page 295: We predict that if it becomes a law, hundreds of thousands of man-hours of now available employment in this industry will cease to exist because of the number of daily newspapers which cannot survive and because of the number of editions which, of necessity, will be discontinued. MANY OF THE FOREGOING WITNESSES GAVE EVIDENCE TENDING TO SHOW THE NECESSARY CURTAILMENT OF EXPORTS AND INCREASE OF IMPORTS, WITH CONSEQUENT REDUCTION OF WORKERS IN DO¬ MESTIC ENTERPRISES WHICH THE 30-HOUR BILL WOULD CAUSE We point to only a few of them as typical: At page 396: Ralph E. Flanders, president Jones & Lamson Machine Co., Springfield, Vt.: Owing to the fact that our type of industry, which is a capital-goods industry has had practically no demand in this country for vears, we have been forced to cultivate our foreign markets to the limit of our ability, and have been sustained by them. The employment that our men had has been nearly 75 percent on account of foreign orders in the last 4 years, and any increase in the cost of those goods at that time, and at the present time, would make a very serious difficulty in the way of our continuing to sell abroad. The situation at the present time is more nearly on a cost basis of comparison of prices than it has ever been before. The proposals would call for a one-third increase in the wage rate. That would mean one-third increase in labor cost to us, because the 40-hour week is already so low compared to what workers are used to that they are fresh at the end of the day. That is, there is no advantage, such as we have had in time past, in going from 60 hours a week, as I used to work when I was a boy, down to 50 hours a week, whereby you got in a larger number of fresh hours a day and increased the output. The men are now fresh at 40 hours. There would be no increase in output. There would be an added 33½ percent in wage rate, which in our case would make directly a certain increase of about 12 to 15 percent in cost, and, indirectly, as 1 described, a much larger one because everything we buy would be correspondingly increased in cost. At page 413: The Consumers’ Goods Industries Committee: Effect on foreign trade.—Again the Government is struggling to promote our foreign trade. This bill would practically exclude us from the export markets of the world. How could we compete with Japan—or even Europe? Moreover, it would seriously hamper the domestic producer in competition with the importer. The tariffs have been established with a view to equalizing labor costs and protecting the American manufacturer against cheaper labor abroad. This tariff equalization would no longer be effective if labor costs to 20 THIRTY-HOUR WORK WEEK the American manufacturer were arbitrarily, by Government fiat, suddenly increased one-third. This country is already Japan’s largest customer—larger even than China—with 400,000,000 people, or India with 300,000,000. It is true that the Connery bill in the House pretends to make provision to equalize this disadvantage, but the means suggested would be utterly ineffective to that end. I. THE BILL IS INCOMPATIBLE WITH A FREE GOVERNMENT It is contrary to natural right. The pursuit of happiness, which involves freedom to exercise one’s spirit, intelligence, and skill, was one of the natural rights proclaimed in the Declaration of Independence. Another natural right is equality of treatment by government. The bill would curtail the liberty of workers to sell their services, to increase their productivity, to improve their standard of living; whereas, it would leave unhampered by its direct prohibitions “officers, executives, and superintendents and their personal and immediate clerical assistants. The bill is in direct contradiction of the American theory of Gov- ernment: We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable rights, that among these are life, liberty, and the pursuit of happiness. That to secure these rights, governments are instituted among men, deriving their just powers from the consent of the governed. -Declaration of Independence. This bill is unnatural because it proposes to convert the lawful acts of employment and service into misdemeanors and punishable offenses. In this respect it discriminates between citizens holding one man guilty and another man honest though each does the same thing, namely: Work, contract. The bill proposes to destroy the natural independence and dignity of labor; it discourages self-discipline, self-government, self-improve- ment. It proposes to flatten out on a lower level or standard than now exists the entire body of labor universally throughout the United States. It is wholly inconsistent with the democracy of labor and the right of bargaining, collectively and otherwise. The penalty for this drastic violation of the principles upon which a free Government was founded would inevitably be suffered. Many of the foregoing witnesses referred to this. We cite only the following: G. W. Dyer, The Southern Industrial Council, (hearings, p. 352): At page 355: This bill provides for an all powerful boycotting system to punish and destroy indirectly those that it cannot reach directly for the crime of exercising what are conceded to be constitutional rights. If a factory, shop, hotel, or other business enterprise not engaged in interstate commerce does not conform to the mandates of Congress, the Federal Government, through all of its agencies is ordered to boycott such enterprise in every way possible. Government agencies are not permitted to patronize such business concerns. The Government must refuse to make any loans to such enterprise and must refuse to renew any loans made. Not only is it a boycott, but it makes everybody that does any business with the Government line up and destroy people who are doing nothing but exercising their constitutional rights. I never heard of such a preposterous condition taken by any Government in the history of civilization. I would like somebody to point THIRTY-HOUR WORK WEEK 21 me to a single case where the Government has organized to boycott its own citi- zens for exercising their constitutional rights. The right of man to work and maintain his independence is one of the funda- mental human rights of civilization. This bill prohibits him from working suffi- ciently to maintain himself. If he works 6 hours and cannot make a living he is not allowed to go on and continue and support himself. It was one of the inalienable rights made by Jefferson in the Declaration of Independence, the inalienable right of the pursuit of happiness. It is more fundamental then the right of suffrage or the right of free speech. I know of no government, civilized or uncivilized, that has denied to its citizens this funda- mental right. 3. IT AtrePrS ro EeRIse Powers Nor Vesre IN CONGReSs The bill establishes a Federal monopoly of labor. It deals with intrastate production. It attempts to establish control over services performed wholly within State boundaries in local domestic transactions which are not commerce. The embargo on interstate and foreign commerce provided for in the bill is merely an element of force and coercion to be used with boycott by the Government or any department or organization thereof, with boycott by contractors for public works, with forfeiture of loans and loan privileges, with impairment of contracts, and with fines and imprisonments, to implement the monopoly of labor created by the bill. The bill does not regulate interstate commerce, it prohibits inter- state commerce. The individual it acts upon is not an instrumentality of commerce. The article that it proscribes has no taint in it of fraud, unwhole¬ someness or other element injurious to commerce. The bill usurps powers reserved to the several States exclusively to regulate their social and economic standards and to exercise the police power over domestic and local business. DECISIONS Since the hearings on this bill were closed, United States Circuit Judge Charles B. Ferris, sitting as a district judge, ruled expressly on this question. According to the United Press, he held that Congress has no power to fix wages and hours for intrastate business. The ruling denied the Federal Government’s petition for a tem- porary injunction to prevent the National Garment Co. and the National Underwear Corporation, both of St. Louis, from violating the N. R. A. code for the industry. The decision seems to parallel that of Federal Judge John P. Nields. of Delaware, in the Weirton Steel Co. case, in which the court ruled that the company’s relations with its employees did not affect inter- state commerce and were beyond the power of the Federal Govern- ment to regulate. Judge Ferris is quoted by the United Press as holding, among other things: * * * Since the cases ruled by the Supreme Court which I have cited and dozens of others which could be cited are clearly against the validity of a Federal law which fixes wages and hours of labor in a private and wholly intrastate busi¬ ness, uncoupled with any public interest and, since I find myself wholly unable otherwise to construe these cases, as an inferior court I am bound to follow them. THIRTY-HOUR WORK WEEK 22 Neither a policy nor a whereas can add one jot or tittle of force or power to a legislative act when the organic law forbids or (in case of the Federal Constitu- tion) furnishes no warrant for the passage of the act. Also, since the hearings were closed, the Supreme Court of the United States in Baldwin, Commissioner, v. G. A. Seelig, Inc., and G. A. F. Seelig, Inc., v. Baldwin, Commissioner (604, 605 October term 1934, March 4, 1935), has redeclared the independence of the several States in respect to regulation of intrastate business. In these cases provisions of the New York Milk Control Act were held unconstitutional which undertook to prohibit the sale in New York of milk purchased in Vermont for less than the minimum price paid to the New York producers. Mr. Justice Cardozo delivered the opinion of the Court, which con- tained the following expression of the principle referred to, Opinion, p. 6: * * * Commerce between the States is burdened unduly when one State regulates by indirection the prices to be paid to producers in another, in the faith that augmentation of prices will lift up the level of economic welfare, and that this will stimulate the observance of sanitary requirements in the preparation of the product. The next step would be to condition importation upon proof of a satisfactory wage scale in factory or shop, or even upon proof of the profits of the business. Whatever relation there may be between earnings and sanitation is too remote and indirect to justify obstructions to the normal flow of commerce in its movement between States. Cf. Asbell v. Kansas, 209 U. S. 251, 256; Railroad Co. v. Husen, 95 U. S. 465, 472. One State may not put pressure of that sort upon others to reform their economic standards. If farmers or manufacturers in Vermont are abandoning farms or factories, or are failing to maintain them properly, the legislature of Vermont and not that of New York must supply the fitting remedy (p. 8). * * * Neither the power to tax nor the police power may be used by the State of destination with the aim and effect of establishing an economic barrier against competition with the products of another State or the labor of its residents. Restrictions so contrived are an unreasonable clog upon the mobility of com- merce (p. 9). * * * It isone thing for a State to exact adherence by an importer to fitting standards of sanitation before the products of the farm or factory may be sold in its markets. It is a very different thing to establish a wage scale or a scale of prices for use in other States, and to bar the sale of the products, whether in the original packages or in others, unless the scale has been observed. John B. Battle, executive secretary National Coal Association, pointed out that S. 87 attempts to exercise powers not vested in Congress (hearings, p. 157). At page 157: In 259 U. S. 355, the court used the following language: Coal mining is not interstate commerce, and the power of Congress does not extend to its regulation as such. Again, in 247 U. S. 251, 272, the court said: “The making of goods and the mining of coal are not commerce, nor does the fact that these things are to be afterward shipped or used in interests commerce make their production a part thereof.' W. A. Wentworth, secretary dairy industry committee (hearings, p. 398). At page 401: Applied to S. 87, eight Federal Court decisions which have indicated the intrastate character of the business of processing milk and manufacturing butter, cheese, ice cream, and dry milk. These cases hold that Congress has no power to regulate such manu- facturing I might refer to those eight Federal court decisions by name. They are: Douglas v. Wallace, Oklahoma City, Okla.; Hillcrest Dairy v. Wallace, Des 23 THIRTY-HOUR WORK WEEK Moines, Iowa; Greenwood Dairy v. Wallace, Indianapolis, Ind.; A Group Fifteen Dairies v. Wallace, Louisville, Ky.; Hill v. Darger, Keirtz v. Berdil, Los Angeles, Calif.; Edgewater Dairy v. Wallace, Chicago, III.; Royal Farms v. Wallace, Baltimore, Md. Those are very widely distributed, and two of them are particularly interesting because they involved intrastate business in competition with interstate business, Chicago and Baltimore being the two. James A. Emery, representing the National Association of Manu- facturers (list of associations in 30 States and other associations in larger cities) (hearings, pp. 223-224). At page 226: Mr. Emery pointed out the unusual form of criminal provisions making punishable the following: (1) Any violation of any provisions of this act. (2) Failure to comply with any requirement of the act. (3) Failure of any person to operate within the labor standards set up. (4) Failure to conform to any of the stipulations made by private contractors. (5) Failure to conform to requirements in applications for loans. (6) Failure to pay the principal upon the violation of any óf the labor standards. (7) Failure of any person to put into effect and operation the pro- visions of the law. (8) Performance of voluntary agreements heretofore made with the President. (9) Reducing directly or indirectly any daily or weekly wage which is in existence at the date of approval of the act. * * * It would be an arbitrary discrimination if they are setting up a con- trol and a regulation of hours of labor which they do not apply to themselves, although the law requires it of the six enumerated types of industry. At page 228: * * * Any carrier which receives it, whether by air, by water, by road, or by rail, equally violates the provisions of the act. If any of the commodities or articles which have been produced under the forbidden conditions get into the hands of distributors or wholesale or retail merchants, they may not in turn ship them in interstate or foreign commerce or * * * send them by mail, Again- * * * It may differ in no way from commodities which are produced in 31 * * or 32 or 40 hours. You will take notice that the major loans that have been made are not being made to producing industries. They have been made to transportation indus- tries, insurance companies** At page 229: * * * A very arbitrary discrimination in the penalties which are provided * in relation to the use of Government credit, * * * It is not merely a limitation upon employers. It is a limitation upon all workers, since it restricts the credit of the contractors who are large * * employers of labor, * * * I call attention to the fact that the criminal features of the act operate not only against violators, but against those who fail to comply with its requirements. Any person who works more than the allotted time fails to comply with the requirements of the act. ** * * There are something like 3,000,000 distributors in the United States. There are several hundred thousand forms of manufacturing. There is a vast network of transportation agencies. If this act were to be enforced every one * * * of them would be required to be subjected to some form of policing. THIRTY-HOUR WORK WEEK 24 At page 230: *** They will apply today to some 25,000,000 persons engaged in employment in codified industries. At page 231: * * * There is no provision for overtime. No man can earn more than he can gain in 30 hours. At page 232: * * * The right to engage in interstate or foreign commerce is derived nót from Congress, nor from the Constitution, but that it existed before the Constitution came into existence. At page 233: Gibbons v. Ogden (9 Wheat.): In pursuing this inquiry at the bar, it has been said that the Constitution does not confer the right of intercourse between States, and states that right derives its source from those laws whose authority is acknowledged by civilized man throughout the world. This is true. The Constitution found it an existing right and gave to Congress the power to regulate it. At page 232: The purpose of the grant by the people and the States to Congress of the authority to regulate commerce was to preserve and promote intercourse between the States and between the people. It was not to hinder or destroy it. The Articles of Confederation attempted to preserve intercourse between the States in behalf of all the citizens. It was the failure to enforce that right that led*** to the convention which formulated the Constitution of the United States. At page 235: *** The bill*** is in itself a regulation not of commerce, but of production upon its face. It has been said over and over again by the Supreme Court of the United States, not upon one occasion, but upon dozens of occasions, that the mining of coal, the mining of oil, the manufacture of goods, the construction of houses, are not “commerce”, but are acts of production which cannot be regulated by the Congress under commerce power, that any endeavor to do so is an attempt to exercise a power which Congress does not possess. Child Labor Taxation case, Bailey v. Drexel Furniture Co. (259 U. S. 47): * * * The court set aside the exercise of the taxing power as a plain endeavor to exercise one power under the guise of exercising another. Delaware, Lackawanna & Western Railroad Co. v. Yurkonis (278 U. S. 439): Where a man was engaged in shifting coal from a mine into a car destined for interstate commerce. The court held that the man was not engaged in interstate commerce. At page 236: * * * In this McClosky v. Merriville & Northern Railroad (243 U. S. 96): case the endeavor was made to recover under a Federal Employees’ Liability Act, on the ground that a lumber company operating a short railroad line to the Puget Sound in Washington State was engaged in interstate commerce, because the logs carried over its railroad were about to enter interstate commerce. Re¬ covery was denied, on the ground that the company was not engaged in inter- state commerce. Coe v. Errol (116 U. S. 517): Where a lumberman in New Hampshire was preparing his logs for shipment and floating them down the river, and the log raft was tied up at the town of Errol, and the town undertook to tax the logs. * * * Had not become a part of commerce** United Mine Workers of America v. Coronado Coal Co. (269 U. S. 344):* There was a question involved as to whether or not a local union engaging in a strike and tying up the operation of a coal mine was, by obstructing the produc- tion of coal, engaged in restricting interstate commerce. The court said it was not; * * * The court said: “As long as there is restraint only on coal in that vicinity it has no relation to interstate commerce, because coal mining is * * not commerce. It is production, THIRTY-HOUR WORK WEEK 25 In Anderson v. Ship Owners’ Association (272 U. S. 359), the court said: “Neither the making of goods nor the mining of coal is commerce; and the fact that the things produced are afterwards shipped or used in interstate commerce, does not make their production a part of it. At page 237: * * * There was a United Leather Workers v. Herkert (265 U. S. 457): * * * The court pointed out that it strike of leather workers in St. Louis. was neither within the doctrine of “the flow of commerce”, nor was it a case in * * * which plainly the purpose and effect was to interfere with commerce itself. Crescent Cotton Oil Co. v. Mississippi (257 U. S. 129) * * * There a Ten¬ nessee corporation was engaged in ginning cotton * * * When it endeavored to erect its gin in Mississippi it ran against the State law which fixed the size of the gin and required it to be in the same city or community in which the crushing * * * process went on. * * * The State undertook to sustain the act on the ground that the act of production against which it was directed was subject to regulation by the State, and that it was not engaged in interstate commerce. The Court sustained that view. At page 237: Hisler v. Thomas Colliery Co. (260 U. S. 245): * * * The coal company insisted that the levying of that tax at that time and under those conditions operated as an obstruction to the flow of commerce, since the coal was at the point at which it was about to enter commerce. The Supreme Court** upheld the tax on the ground that the coal was not in interstate commerce. At page 237: 4* Illustrates the vital and funda¬ Kidd v. Pearson (128 U. S. 20): mental distinction between the regulation of production and the regulation of commerce, preserving to the State the control of production and to Congress the control of the intercourse between the States. At page 238: * * * The Court said: “No distinction is more popular in the common mind or more clearly expressed in economic and political literature than that between manufactures and commerce. i At page 239: In re Green (52 Fed. 113) which has been frequently quoted with approval by the Supreme Court: * * * “When the commerce begins, it is determined, not by the character of the commodity nor by the intention of the owner to transfer it to another State for sale, nor by his preparation of it for transportation, but by its actual delivery to a common carrier for transportation, on the actual commencement of its transfer to another State. At page 239: Willoughby’s work on the Constitutión (p. 774) *** * That commodities are manufactured with the intent that they are to be exported, in part or in whole, is absolutely immaterial, as determining the exclusiveness of State authority over their production (Coe v. Erroll, 116 U. S. 517). At page 240: Then, in order to bring this matter up to date, I have before me here decisions of 13 courts of the United States involving operations under the N. I. R. A. which follow the line of authorities which I discussed this morning and which present to you the picture of the Federal district courts applying the principles which I enunciated between December 21, 1933, and December 21, 1934. At page 240: Purvis v. Bazemore, United States District Court, Southern District of Florida, December 2, 1933. (Pressing, cleaning, and dyeing of clothes not interstate commerce.) At page 240: United States v. Suburban Motor Service Corporation, U. S. D. C., Northern District of Illinois, February 10, 1934. (Pe- troleum Code invalid as applied to retailer.) THIRTY-HOUR WORK WEEK 26 At page 240: Panama Refining Co. v. Ryan, U. S. D. C., Eastern District of Texas, February 12, 1934. (Oil production, like mining, not interstate commerce. At page 240: United States v. Bob Lieto, U. S. D. C., Northern District of Texas, February 16, 1934. (Wages and hours of an em- ployee not subject to Federal regulation. At page 241: Hart Coal Corporation v. Sparks, U. S. D. C., Western District of Kentucky, May 19, 1934. (Injunction from prosecuting for violation of minimum wage provisions.) At page 241: Irma Hat Co. v. Retail Code Authority, U. S. D. C., Northern District of Illinois, July 31, 1934. (Retail trade beyond regulatory power of Federal Government.) At page 241: United States v. Gearhart, U.S.D. C. of Colorado, August 8, 1934. (Production and sale of coal within borders of one State not interstate commerce. Minimum price provisions not effective.) At page 241: United States v. Eason Oil Co., U. S. D. C., Western District of Oklahoma, September 22, 1934. (N. R. A. unconstitu- tional.) United States v. Belcher, U. S. D. C., Northern District of Alabama, October 31, 1934 (N. I. R. A. unconstitutional and Lumber Code invalid). At page 241: United States v. Kinnebrew Motor Co., United States District Court, Western District of Oklahoma, November 12, 1934. (Sales of second-hand automobiles not within power of Congress to regulate.) At page 242: United States v. Sutherland, United States District Court, Western District of Missouri, December 7, 1934. (N. I. R. A. not valid as to retail lumber merchant.) At page 242: United States v. Rogles, United States District Court, Eastemn District of Missouri, January 24, 1935. (Retailing of coal not within Federal control.) At page 242: Table Supply Stores, Inc. v. Hawking, United States District Court, Southern District of Florida, January 23, 1935. (Local merchant not liable for failure to pay minimum wages.) At page 242: United States Electric Coal Co. v. Rice, United States District Court, Eastemn District of Illinois, December 21, 1934. (Mining coal wholly intrastate. At page 243: Champlain Refining Co. v. Corporation Commission of Oklahoma (268 U. S. 235). (Regulation of the extraction of oil for a State conservation Commission to prevent waste within State. The Supreme Court held that this was entirely within the authority of the State.) At page 243: Edilman v. Boeing Air Transport Lines (289 U. S. 249). (The taking of gas from a tank and placing it in an airplane at an airport a wholly local transaction.) At page 243: Utah Power & Light Co. v. Pfost (286 U. S. 165). (Kilowatt tax by State of Idaho sustained as an act of manufacture, though the energy flowed from Idaho into Utah.) FOLLOWING CASES ILLUSTRATE THE PRINCIPLE THAT CONGRESS MAY NOT EXCLUDE FROM COMMERCE ANY ARTICLE OR COMMODITY IRRE¬ SPECTIVE OF ITS NATURE EXCEPT IT BE PRODUCED UNDER SUCH TERMS AS CONGRESS REQUIRES At page 244: In Hammer v. Dagenhart (247 U. S. 251), commonly known as the “Child Labor Case , Congress undertook to deny THIRTY-HOUR WORK WEEK 27 transportation in interstate and foreign commerce to goods produced by the labor of persons of a fixed age and working more than a certain number of hours, or between certain hours of the day. At page 245: * * * But it is insisted that adjudged cases in this Court establish the doctrine that the power to regulate given to Congress incidentally includes the authority to prohibit the movement of ordinary commodities, and therefore that the subject is not open for discussion. The cases demonstrate the contrary. And the minority of the Court dissenting through Mr. Justice Holmes held: The objection urged against the power is that the States have exclusive control over their method of production, and there Congress cannot meddle with them and, taking the proposition in the sense of direct intermeddling, I agree to it and suppose that no one denies it. At page 245: Bailey v. Drexel Furniture Co. (259 U. S. 20), com- monly known as the Child labor tax case”, attempted to accomplish the same end as the above case through another coercive power, namely taxation, the Court held: Yet when Congress threatened to stop interstate commerce in ordinary and necessary commodities, unobjectionable as subjects of transportation, and to denv the same to the people of a State in order to coerce them into compliance with Congress’ regulation of State’s concerns, the Court said this was not in fact regula- tion of interstate, but rather that of State concerns and was invalid (referring to the Dagenhart case). At page 246: So here the so-called “tax” is a penalty to coerce people of a State to act as Congress wishes them to act in respect of a matter completely the business of a State government under the Federal Constitution. Mr. Emery discussed section 4 of the resolution and pointed out that the arbitrary restriction of contract amounted to a taking of property without due process of law: What has happened here is that the earning power of every citizen of the United States is limited to the amount that he may be permitted to earn within a fixed * * period of time. At page 250: Wolff v. Kansas Court of Industrial Relations (262 U. S. 522), and Dorchy v. Kansas (262 U. S. 286), held it to be a denial of the due process of law to compel the arbitration of differences resulting from disputes over wages and hours. This was because it arbitrarily took from both parties the right to make their contract with each other. Pamphlets and charts, numerous letters, and several petitions by workmen (exhibits not printed) tend to show that unemployment would be aggravated, and recovery impeded by the enactment of the bill. CONCLUSION The effect of inadequate employment recovery during the limita- tions of hours under the N. R. A. admitted by the proponents of the bill (hearings, pp. 42, 57, 61) is to discredit the theory of the pending bill that more drastic and rigid limitations would excite business activity and create jobs. The rational deduction is that more limita- tions would cause more unemployment. The inexorable laws of nature requiring flexible hours of service for perishable and seasonal products, and requiring obedience to human THIRTY-HOUR WORK WEEK 28 characteristics, individually and in families, and to human capacity and qualifications, which hinder transfers from one occupation to another and from one section to another, render the theory of the bill impractical. The economic certainty of the sequence of frozen time and wages, increased costs and prices, lower real wages and less purchasing power, diminished volume of production and sale, reduced business activity and increased idleness with lower standards of living, ought to prevent the enactment of this bill. The fundamental conflict of statutory control of the workman, with his freedom to contract and his equality of right to pursue happiness through the exercise of spirit, mind, and body calls for protection by Congress of the workman against such a statute as this. Finally, all Americans are entitled to have Congress govern itself to the extent of refraining from the passage of this act which so obviously violates the rights of citizens of the several States; to have their own States regulate intrastate production and commerce, to be secure in the ownership and possession of their property, and to be free from fear of confiscation, embargo, boycott, forfeiture, impair- ment of contract, and of fines and imprisonment, for transacting law- ful business in a lawful way. We recommend that S. 87 be not passed. WARREN R. AUSTIN. We have read the report and concur in the recommendation. DANIEL O. HASTINGS. EDWARD R. BURKE.