1935 CONGRESSIONAL RECORD-HOUSE 585 is authorized, set forth, and provided for in said Central Valley HOUSE OF REPRESENTATIVES project act of 1933, and hereinafter referred to as "project." SEC. 3. The Secretary of the Interior and the Secretary of War THURSDAY, JANUARY 17, 1935 shall have and exercise joint power and authority in administer­ ing this act. The House met at 12 o'clock noon. SEC. 4. The said Secretary of the Interior and the said Secretary Rev. James Shera Montgomery, D. D., offered the following of War shall authorize and approve all expenditures to be made prayer: under this act; shall approve any and all plans and specifications for the construction of said Central Valley project; shall exercise Blessing and honor, glory and power be unto Him who general supervision and control over the construction of said sitteth upon the throne forever and ever. Before Him we project to the extent necessary to insure substantial compliance with the approved plans and specifications; shall approve all con­ would bow down and bare our souls that we might receive tracts entered into by said water project authority for the sale, the gifts of mercy and comfort. Al.mighty God, rouse us to use, or disposal of water and electric energy or other facilities the contemplation of things eternal and let their currents to be made available by the operation of said project as to their sufficiency in matters of both form and substance, and shall have keep our souls in motion. To every fear Thou dost give a and exercise such incidental powers as may be necessary or appro­ promise, and to every prodigal doubt Thou dost offer assur­ priate to insure the proper application of the funds made avail­ ance. To any who may be in the gloom, with fitful and able hereunder and to protect properly the interests of the uncertain glimpses through the clouds and without a smiling United States in the premises. Upon the completion of construc­ tion of said project and the repayment to the fund hereinafter future, do Thou steady and stay their faith in divine sov­ created of all moneys loaned to said water project authority, for ereignty which will never terminate until the throne of God the repayment of which provision is made in this act, together itself crumbles. Bless our homes, merciful Father, and may with interest thereon as herein provided, and the transfer of they ever be the very gates to Heaven. In the name of ow· said moneys so loaned, together with interest, into the United States Treasury, all powers, duties, and functions created and Redeemer. Amen. · established by this act shall cease and terminate. SEC. 5. (a) There is hereby established a special fund, to be The J oumal of the proceedings of yesterday was read and known as "Central Valley project fund" (hereinafter referred to approved. as the " fund "), and to be available, as hereinafter provided only CENTRAL VALLEY PROJECT, CALIFORNIA for carrying out the provisions of this act. All payments or advances to said water project authority, and all moneys received Mr. STUBBS. Mr. Speaker, I ask unanimous consent to therefrom, in carrying out the provisions of this act, shall be extend my own remarks in the RECORD and to include therein made from, or received into said fund, under the direction of the Secretary of Interior and the Secretary of War. a copy of a bill I have introduced for the construction of the (b) The Secretary of the Treasury is authorized to advance to Central Valley project in California. the fund for the use of and expenditure of said water project The SPEAKER. Is there objection to the request of the authority, from time to time and within the appropriations there­ gentleman from California? for, such amounts as the Secretary of the Interior and the Sec­ retary of War shall certify to be necessary to meet the require­ There was no objection. ments for funds of the construction program of the said water Mr. STUBBS. Mr. Speaker, late in the last Congress I project authority, except that the aggregate amount of such ad­ appeared before the House and served notice that, at the vances shall not exceed the said sum of $170,000,000, the appro­ priation whereof is herein authorized. opening of the current session, I would bring to the atten­ Of the total amount herein authorized to be appropriated, tion of the Congress the great need for early construction $38,000,000 thereof is hereby allocated as a direct grant to said activities on the Central Valley project in California, a water project authority and shall be used and applied toward de­ project designed to protect and preserve the social and eco­ fraying the cost of the necessary labor and materials entering into the cost of the construction of said projects; $12,000,000 thereof is nomic status of a great inland nation. Today, in keeping hereby allocated as a special and direct contribution to and partici­ with that earlier statement and a later promise to my peo­ pation in the cost of construction of the Kennett Dam of said proj­ ple, I am introducing a bill which calls for a congressional ect on account of the general and Federal benefits from the con­ struction of said dam to navigation, flood control, and salinity appropriation of $170,000,000 for construction of the Cen­ control, in accordance with the report of the Chief of Engineers of tral Valley project. The bill is designed to provide Federal the War Department dated April 6, 1934, and contained in House of financial assistance for the project with supervision under Representatives Document No. 35, Seventy-third Congress, second a water project authority created by the California State session, and shall be used and applied toward defraying the cost of construction of said Kennett Dam; both of which sums, constitut­ Legislature and later approved by the people of California ing in the aggregate $50,000,000, shall be made available to said in a special election. water project authority for the uses and purposes of this act, and As a matter of record, I desire herewith to present the in the manner herein provided and subject to the provisions of this bill which I have introduced, and to offer you a preliminary act, without necessity of or provision for repayment or reimburse­ ment to said fund or to the Treasury of the United States; the statement showing the practicability of the project, its need remaining sum of not to exceed $120,000,000 shall be allocated and as a social agency, and its feasibility from an engineering made available to said water project authority as a loan, to be standpoint. Before going further, let me add that the repaid to said fund over. a period of 40 years commencing with the tenth year after beginning of construction of said project, and to project is a self-liquidating one, and the cost will be borne bear interest at the rate of 4 percent per annum. As security for by those who benefit from it. such repayment, the Secretary of the Interior and the Secretary of A BILL War are authorized and empower.ed to accept and receive the reve­ nue bonds of said water project authority, or may purchase such Be it enacted, etc., That for the purpose of improvement of revenue bonds, and may execute such contract or contracts with navigation on the Sacramento and San Joaquin Rivers in the said water project authority as may be necessary, expedient, or State of California; to control destructive flood waters in said advisable in order to protect the interests of the United States, and Sacramento and San Joaquin River Basins; to aid and improve may supervise and approve the operation and maintenance of said agriculture and industry within said basins; to provide for the Central Valley project so long as said loan or any part thereof shall generation of electrical energy as a means of making the project remain unpaid. The Secretary of the Interior and the Secretary of hereinafter referred to a self-supporting and financially solvent War may dispose of any such bonds so received to p~blic or private undertaking; to provide for the economic and social well-being of agencies or entities on such terms as they may deem and find the people of the State of California, and for other beneficial advantageous. purposes, there is hereby authorized to be appropriated from time (c) Moneys in the fund advanced under subdivision (b) shall to time out of any money in the United States Treasury not be available only for expenditures for construction, and for the otherwise appropriated, such sums of money as may be neces.sary payment of interest during construction and for 1 year there­ to carry out the purposes of this act, not exceeding in the aggre­ after, on any amounts loaned as herein provided; Provided, That gate the sum of $170,000,000. any amount loaned a.s herein authorized may be expended by SEC. 2. All moneys authorized to be appropriated by this act said Water Project Authority for any purpose authorized by said shall be made available as herein provided for expenditure by the Central Valley Project Act. Water Project Authority, a body politic and corporate, created in (d) The Secretary of the Treasury shall charge the fund as and by an act of the Legislature of the State of California passed of June 30, in each year, with such amount as may be necessary and adopted at the legislative session of 1933, and designated the for the payment of interest on any loan, or portion thereof, made Central Valley project act of 1933 (ch. 1042, Stat. of 1933), under subdivision (b) at the rate of 4 percent per annum ac­ and thereafter approved by the people of the State of California at crued during the year upon the amounts so advanced and re­ a special election held in said State on December 19, 1933; said maining unpaid, except that if the fund is insufficient to meet moneys to be expended, subject to the provisions of this act, for such payment of interest the Secretary of the Treasury may, in the purpose of the acquisition of the necessary rights and proper­ his discretion, defer any part of such payment, and the amount ties and the construction by said Water Project Authority of the so deferred shall bear interest at the rate of 4 percent per annum Central Valley project, as said project and the construction thereof until paid. 586 CONGRESSIONAL RECORD-HOUSE JANUARY 17

(e) The Secretary of the Interior and the Secretary of War croaching des~rt. We cannot afford to allow a natural food shall certify t o the Secretary of t he Treasury, at the close of each fiscal year, the amount of money in the fund in excess of the bin of this magnitude to revert to a sandy waste. Such amount necessary to meet the requirements for funds of the procedure would not prove sound economics and would be construction program for said project. Upon receipt of each contrary to our current social agendum. such certificate the Secretary of the Treasury is authorized and While the problem faced by the Sacramento Valley is not directed to charge the fund with the amount so certified as re­ payment of or credit on any of the advances· made under sub­ precisely the same as that which the San Joaquin Valley division (b), which amount shall be covered int o the Treasury must countenance, yet the Sacramento Valley is in a danger­ to the credit of miscellaneous receipts. ous position from invasion by the sea. During the fresh­ SEC. 6. Before any money is appropriated for the purposes of water period the fresh excess water escapes to the sea, and this act, the Secretary of the Interior and the Secretary of War shall require the submission by the Water Project Authority at various times the salt sea water invades the Sacramento of contracts for the furnishing, disposal, or use of water and Valley agricultural areas. A salt water barrier at the mouth electric energy or other facilities to be made available by the of the. Sacramento River would provide a solution for that operation of said project, establishing revenues in such amounts as they shall deem sufficient to demonstrate the ability of said particular problem. Water Project Authority to pay any and all expense of operation Both valleys, however, have two great interests in common and maintenance of said project and to repay to said fund any in this project. It would provide cheap power for both and and all amounts loaned, together with interest thereon, as herein increase the navigability of two great rivers, the San Joaquin provided, having and giving due consideration to any showing which may be made or presented by said Water Project Authority River in the San Joaquin Valley and the Sacramento River indicating future growth of population in said Sacramento and in the Sacramento Valley. San Joaquin River Basins, industrial expansion therein, and con­ Powerful interests have opposed this project since its in­ sequent future increased demand for such facilities to be made available by the operation of said project, which may be reason­ ception in the minds of men 30 years ago, but its worth from ably anticipated. a social and economic standpoint is self-evident. Thou­ HISTORY OF PLAN sands of men could be put to work immediately in digging Without any effort to go too deeply into the subject at the canals, building the pump stations, and constructing the this time, but in order that you might have some informa­ dams which are units in the project. tion on the backgtound of this project, let me recount a bit SPECIFIC PURPOSES OF PROJECT of history and a few comparisons associated with the Cen­ As reported, the general purpose of the Central Valley tral Valley project and advise you of its value from a social project is to develop more stable and secure economic and and economic standpoint. social conditions in the Central Valley of California, while The two greatest valleys in California, named the San the more specific purposes as originally defined and deduced Joaquin Valley and the Sacramento Valley, together form from documents dealing with the subject are: what is known as the "Central Valley of California." The First. (a) To provide adequate water for irrigation of the Central Valley of California is as big in land area as any one Sacramento and San Joaquin Valleys to land already under of 20 certain States of the Union, and to emphasize my development. statement let me point out that you could place the States (b) To provide a flow of sufficient fresh water to the delta of New Jersey, Delaware, Maryland, New Hampshire, Ver­ land~ of the San Joaquin and Sacramento Rivers, to check mont, and Massachusetts combined within its borders and salinity from the increasing invasion of salt water from San still have enough room left over to tuck several areas the size Francisco Bay, which is ruining profitably used truck-farming of the District of Columbia into unoccupied corners. lands. Thirty years or so ago the Central Valley of California Second. To provide power for pumping water for these pur­ was a veritable Garden of Eden. Today it is one of the poses and to provide power for general use throughout a good greatest agricultural areas in all the world. It is one of the portion of California. greatest irrigation districts in the world. Quarter of a cen­ Third. To improve navigation of the San Joaquin and tury ago centrifugal pumps drew plenty of water from a Sacramento Rivers. depth of less than 30 feet to supply the thirsty agricultural Fourth. To control floods in the Sacramento River. fields, and it appeared that the watersheds of the surround­ Fifth. To provide an adequate supply of water to the in­ ing mountain areas would furnish enough of this irrigation dustrial and municipal areas of Contra Costa County. water to satisfy any additional development of farm lands. Sixth. To provide irrigation water for the future develop­ Farsighted ones, ]1owever, realized that lowering water ment of agricultural lands in the· Sacramento and San Joa­ levels, fire-denuded watersheds, and the growing agricul­ quin Valleys. tural activities and population would bring about a crisis The proposed project, estimated to cost $170,000,000, in­ within a few decades-and today, 30 years later, that crisis cludes the construction of a series of dams, reservoirs, power is arrived. The Central Valley of California, under present plants, canals, pumping stations, transmission lines, and ir­ conditions, definitely has reached its agricultural peak,· and rigation systems in the Sacramento and San Joaquin Valleys. unless our lands are flooded with excess water from the north The project is divided into six units. and the sea is barred from encroaching upan the Sacra­ Unit 1: The Kennett Dam unit comprises the Kennett mento Valley, retrogression is due before long. In the San Dam, reservoir, and power plant, and the Kennett transmis­ Joaquin Valley there is not enough water to supply the agri­ sion line, which includes a substation at Antioch, the approxi­ cultural areas, and in most places the water being used is so mate center of power load for the area served. many hundreds of feet underground, the cost of boosting The Kennett Dam would be located in section 15, township above the earth is prohibitive. 35 north, range 5 west, in Shasta County, about 13 miles If you could come with me into the San Joaquin Valley, above Redding. This will be a gravity concrete dam 460 feet the bread basket of California, I could show you how it is high above low water, 315 feet thick at the base, and 2,430 reverting to the desert, slowly, to be sure, but most certainly. feet long on the crest. It will be equipped with gate-con­ Orchards and vinelands on the outer edge of the valley have trolled overflow spillways and gate-controlled flood-control been abandoned and are turning into waste land. In the outlets. The reservoir created will flood 23,000,000 acres of valley's interior the fertile but arid soil is dying of thirst. land and store 3,980,000 acre-feet of water. The Kennett Unless we can obtain additional water and power, at rea­ power plant, located at the dam, will have an installed ca­ sonable rates, the San Joaquin Valley will become only a long pacity of 275,000 kilovolt-amperes. arm of the Mojave Desert. Picture the plight of this par­ The Keswick After bay Dam will be constructed about 8. 7 ticular valley-a world granary for cotton, grapes, fruits, miles downstream from the Kennett Dam and will serve to and nuts, and almost every other type of product agricul­ regulate to uniform flow the irregular discharge from the turally grown in this country, with a total acreage which Kennett power plant. The Keswick Dam will be a gravity exceeds the combined acreage of -Massachusetts, Vermont, concrete dam 95 feet high and will have an installed capacity New Hampshire, and Delaware, being surrendered to an en- of 50,000 kilovolt-amperes. 1935 CONGRESSIONAL RECORD-HOUSE 587i The Kennett transmission line will run from Kennett and Counties involved in the Central Valley project Keswick power plants to a substation at Antioch, in Contra Costa County. The line will be some 200 miles long and com­ Land area Total Farm (acres) popula­ popula­ prise 3 circuits with a transmission voltage of 220,000 volts tion tion and have a capacity of 260,000 kilowatts. As a part of this unit it is propased to construct the Sacramento-San Joaquin Delta cross channel, which will consist of a dam across the Sacramento near Hood, equipped with navigation locks, a controlling headgate on the left bank of the river above the dam, and a dredged channel connect­ ing Sacramento River with Mokelumme River and its branches to Central Landing on the San Joaquin River. These works will provide for the introduction of Kennett Reservoir water into the San Joaquin Delta and used for salinity control and for diversion by units nos. 2 and 3. Unit 2: The fresh water maintained by release from Ken­ nett Reservoir into the channels of the San Joaquin Delta will be pumped into the Contra Costa conduit, the capacity of which will vary from 120 second-feet at the intake, near Knightsen, to 20 second-feet at the end. This water will be lifted in successive steps by six pumping plants, and will be conveyed in most part in an open concrete canal, and a branch pipe line of 5 second-feet capacity will extend from Bay Point to Martinez. The Contra Costa conduit will sup­ ply water to the manufacturing and agricultural areas along Total: the south shore of Suisun Bay. SanSacramento Joaquin ValleyValley ______------_ Unit 3: The San Joaquin pumping system will be built in 1-~~~~-~~-1~~~ two sections. The first will consist of a series of five dams Grand total ___ ------and pumping plants on the low San Joaquin River, and will, by successive lifts from a lower dam to an upper, deliver For your information, the land area in the Central Valley water from tide level to an elevation of 62 feet at Hills Ferry, is 28.3 percent of the State's total area

pose of taking care of some individual, whether they are Mr. CANNON of ML~ouri. Mr. Chairman, I yield 15 min­ always continued, in the event of the death of that particular utes to the gentleman from New York [Mr. CELLER]. individual. · Mr. CELLER. Mr. Chairman, I rise today briefly to point Mr. WARREN. These are two necessary places, one to the out some of the confusion and chaos which exists relative minority and one to the majority. He is the man who takes to what is known as "administrative rules and regulations." care of the hats and coats as we come in. The man on our These rules and regulations, vast and mighty in number side is deb.d. There is no provision to fill his place, because and influence, are in a certain sense administrative law. of the fact that he was named in this resolution to which I Administrative law, roughly, is that vast body of rules and have referred. The resolution I now present merely provides regulations, proclamations, circulars, bulletins, memoranda, that the Doorkeeper of the House shall appoint his successor. notices, decrees, and orders issued by the executive depart­ Mr. SNELL. Then this was not a new position when this ments. It is almost impossjble because of the failure of man took it? proper promulgation of those orders and their publication Mr. WARREN. It always has been on each side. oftentimes to find out what they really are. These rules and Mr. BLANTON. Mr. Speaker, will the gentleman yield? regulations have the force and effect of law as though they Mr. WARREN. Yes. were solemnly enacted in this Chamber, and oftentimes carry Mr. BLANTON. This position has existed since 1901? with their violations very severe pains and penalties and im­ Mr. WARREN. Yes; with this same man holding it. prisonment. One can realize how necessary it is to have Mr. BLANTON. And a similar position exists in the these rules and regulations codified and classified so that you minority cloakroom, and if that colored man over there now or I may go to some place like the Library of Congress, the filling it were to die my friend from New York [Mr. SNELL] Attorney General's Office, or the library of the Supreme Court · would want the Chairman of the Committee on Accounts to and find out what they really are. However, there is a woeful bring in exactly the same kind of a resolution to appoint a lack of such facility today. The whole business of the mak­ successor in his place to wait on our Republican friends over ing, issue, promulgation, publication, filing, and permanence there, look after their hats and coats and canes and over­ of these rules, orders, and decrees is a veritable hocus-pocus. shoes? Is not that the case? I read from an article, Government in Ignorance of the Mr. SNELL. I wanted to find out what it was. Law-A Plea for Better Publication of Executive Legisla­ Mr. WARREN. Mr. Speaker, I move the previous question. tion, in the Harvard Law Review of December, by Prof. The previous question was ordered. Erwin N. Griswold, wherein he points out that-- The SPEAKER. The question is on agreeing to the reso­ Administrative regulations " equivalent to law" have become im· lution. portant elements in the ordering of our lives today. Many cases The resolution was agreed to; and a motion to reconsider have reiterated the rule that Executive regulations properly made "have the force and effect of law." The volume of these the vote by which the resolution was agreed to was laid on rulings has so increased that full, accurate, and prompt informa­ the table. tion of administrative activity is now quite as important to the THE LATE ANTHONY J. GRIFFIN citizen and to his legal adviser as is knowledge of the product of the congressional mill. There should consequently be no need to Mr. O'CONNOR. Mr. Speaker, I ask unanimous consent demonstrate the importance and necessity of providing a reason­ to proceed for 1 minute to make an announcement. able means of distributing and preserving the texts of this Execu­ The SPEAKER. Is there objection? tive-made law. There was no objection. The President of the United States alone is.sued 674 Executive orders, aggregating approximately 1,400 pages of solid type in Mr. O'CONNOR. Mr. Speaker, the funeral of our beloved the first 15 months after March 4, 1933. colleague, Hon. .ANTHONY J. GRIFFIN, of New York, is being held in New York City this morning. The body is being Where are those Executive orders? Strange to relate, if brought to Washington this afternoon on the 1 o'clock one goes to the White House, where they might repose, or train. This evening the body will lie in the Lee funeral to the State Department, where they should repose, one chapel at Massachusetts Avenue and Fourth Street NE., cannot find many of them. Yet those Executive orders are just a short distance from the House Office Buildings. To­ of vast importance. Profes.sor Griswold goes on to say that morrow morning at 10: 30 o'clock services will be held at these 1,400 pages of Executive orders constitute a greater the Lee funeral chapel, after which the body of our friend volume than that of the preceding 4 years and ne!l.rly sL"t will be taken to Arlington Cemetery for burial, he having times as great as that for the 39 years from 1862 through had a distinguished career as a soldier. to 1900. This is what the American Bar Association has to say on DISTRICT OF COLUMBIA APPROPRIATION BILL, ·1936 ~he subject: Mi. CANNON of Mis.souri. Mr. Speaker, I move that the The practice of filing Executive orders with the Department of House resolve into the Committee of the Whole House on State 1s not uniformly or regularly followed, and the totals are the state of the Union for the further consideration of the really greater than those [which I have Just} indicated. Some bill (H. R. 3973) making appropriations for the govern­ orders are retained or buried in the files of Government depart­ ment of the District of Columbia and other activities _ments. • • • chargeable in whole or in part against the revenues of such One realizes the importance of what I say when a man in District for the fiscal year ending June 30, 1936, and for a particular case in one of our States was convicted of vio­ other purposes. Pending that I suggest that general debate lation of an Executive order. An indictment was brought upon the bill be limited to 4 hours, half to be controlled against him. He was convicted. The case went to the by the gentleman from Pennsylvania [Mr. DITTER] and United States Circuit Court of Appeals and was affirmed. It half by myself, if that is agreeable to him. went to the United States Supreme Court, and, lo and be­ Mr. DITTER. That is perfectly agreeable to me. hold, somebody discovered that the Executive order had Mr. CANNON of Missouri. Mr. Speaker, I ask unani­ been repealed. The Government then, of course, asked dis­ mous consent that general debate upon the bill be limited missal of the indictment improperly brought. See U. S. v. to 4 hours, half to be controlled by the gentleman from Smith, No. 3, October term, 1934, United States Supreme Pennsylvania [Mr. DITTER] and half by myself. Court. This defendant had suffered many difficulties, had The SPEAKER. Is there objection? gone to the expense of hiring a lawyer to plead his case, and There was no objection. had this conviction hanging over his head for months before The SPEAKER. The question is on the motion of the it was discovered i..llat no such Executive order was in gentleman from Missouri existence. In other words, officers of the Government fre­ The motion was agreed to. quently do not know the existence or nonexistence of appli­ Accordingly the House resolved itself into the Committee cable regulations. Some orders are retained and buried in of the Whole House on the state of the Union for the further the voluminous files of the Government departments, some consideration of the District of Columbia appropriation bill, are confidential and are not published; yet if you violate with Mr. GREENWOOD in the chair. them, you may go to jail. The practice as to printing and The Clerk read the title of the bill. publication of orders are not uniform.. Often they are 590 CONGRESSIONAL RECORD-HOUSE JANUARY 17 published in separate paper pamphlets. Sometimes they are lations which are of the nature of public acts and of those which merely mimeographed. Often, like Executive orders of the are of the nature of personal or private acts; and may determine the classes of cases in which the exercise of a statutory power by President, they are printed on a single sheet of paper, which, any rule-making authority relates solely to the internal ad.min­ as likely as not, is fragile and easily lost. To compile all of istration of an agency of the Government; and may provide for them would be quite impossible save by some governmental the exemption from this section of any such classes; except that no regulation shall be made dispensing with the requirement that agency. any statutory rule or regulation subject to the provisions of sec­ Mr. . CHRISTIANSON. Will the gentleman yield? tion 8 of this act shall be printed. Regulations made under this Mr. CELLER. I yield. section may provide that statutory rules and regulations relating Mr. CHRISTIANSON. Will the majority join with the mi­ exclusively to territories, insular possessions, or the District of Columbia, shall not be published, or may be published in a nority in abolishing government by Executive order? separate series. Regulations made under this section may also Mr. CELLER. Well, we cannot do that, and I do not think provide for the separate publication of all statutory rules and the gentleman would want that himself; but I will come to a regulations relating exclusively to the Patent Ofllce. remedy a little later in my remarks. SEC. 4. Any statutory rules and regulations may, without preju­ dice to any other mode of citation, be cited by the number To continue the statement of the American Bar Associa­ assigned to them as provided in section 3 (a), together with the tion: calendar year. Printed copies of statutory rules and regulations, Some orders are made known and available rather promptly bearing the imprint of the Government Printing Office, shall be after their approval; the publication of others may be delayed a the subject of judicial not ice in all the courts of the United mont h or more, with consequent confusion in numbering. The States, and of the several States, territories, and possessions. comparatively large number of recent orders which incorporate pro­ SEc. 5. (a) The provisions of this act shall also be applicable to visions purporting to impose criminal penalties by way of fines and all rules and general orders of courts of the United States, imprisonment for violation is without numerical precedent in the whether issued pursuant to an authority granted by an act of history of the Government. Congress or not. The clerk of any court promulgating any such rules or orders shall send them forthwith to the Public Printer, That is what the American Bar Association says. who shall assign to them their appropriate number in the annual " In the first year of the National Recovery Administration 2,998 series of statutory rules and regulations and shall print and administrative orders were issued", says Professor Griswold. sell them. All_ such rules and general orders of courts shall be included in the compilations and indexes to be prepared under Where are they? Go to the N. R. A. and try to find out sections 6 and 7 of this act. something about those Executive orders, those rules and reg­ (b) The regulations made under section 3 of this act may pro­ vide that the requirement of printing contained in this section ulations. There is hopeless confusion. shall not be applicable to the rules of district courts. In addition to these the Recovery Administration has adopted SEC. 6. At the close of each calendar year, the Public Printer, numerous regulations and sets of regulations which are to be found under regulations made as provided in section 3 (b) of this act, scattered among 5,991 press releases. shall have compiled and printed a compilation of the statut ory rules and regulations, and rules and general orders of courts, You must go to the public prints in most cases to get the for that year, together with a complete index and appropriate wording of many of these rules and regulations and Executive tables. There shall be included in this annual volume a list by orders of the National Recovery Administration. number and title of all statutory rules and regulations which, pursuant to the regulations aforesaid, are not printed in full. It has been estimated that the total amount of "law" evolved The annual volume provided for by this section shall be made during the first year of the N. R. A.'s activities exceeds 10,000 available to the public by the 1st of March of the following year. pages, probably a greater volume than the total amount of statute SEc. 7. The Attorney Genenl, with the aid of the Librarian of law contained in the United States Code. Congress, is authorized and directed to have compiled and pub­ Now, what of the A. A. A.? Regulation upon regulation lished at the Government Printing Office a complete collection of all statutory rules and regulations and rules and general orders has been issued by that body. Try to find some of them. You of courts which are in force at the date this act takes ~ffect. This will have your hands full. Yet some man in your State, some compilation shall be printed in a style which is uniform with man in Kansas, some man in Alabama, some man in Cali­ annual volumes of statutory rules and regulations to be pub­ lished as provided in section 6 of this act. In making and pub­ fornia-unwittingly, without knowledge on the part of him­ lishing this compHation, the Attorney General, with the aid of self or his community or his lawyer or you-will violate these the Librarian of Congress, may, in his discretion, omit any statu­ rules or regulations and suddenly find himself clapped in jail. tory rules and regulations and any rules and general orders of Mr. MAY. Will the gentleman yield? courts which are of the classes which need not be printed under the z:egulations established under sections 3 {b) and 5 (b) of Mr. CELLER. I yield. this act. Mr. MAY. Since there is so much being done in regulating SEc. 8. No statutory rule or regulation establishing an offense the life and habits of the people by Executive orders and de­ or defining an act which pursuant to an act of Congress is pun­ partmental regulations, does the gentleman not think that a ishable as a crime (whether a petty offense, misdemeanor, or felony), or subject to a pena.lty, shall be valid and effective until department, when it issues regulations, and the President, published as provided in section 3 of this act. when he issues Executive orders, ought to be required to have SEc. 9. The 25th paragraph of section 73 of the act of 'Janu­ it published and furnished through the document room? ary 12, 1895 (ch. 23, 28 Stat., pp. 601, 615; U. S. C., title l, Mr. sec. 30), is amended by striking out the word "proclamations." CELLER. I am coming to that. I introduced a bill So much of the act of July 31, 1876 (ch. 246, 19 Stat., pp. 102, which was written by Erwin N. Griswold, of the faculty of the 105; U. S. C., title 44, sec. 321), as reqUires the publication of Harvard Law School, which covers the point. It is H. R. proclamations in a newspaper is repealed. 2884, called the "Statutory Rules and Regulations Publica­ SEC. ·10. Nothing in this act shall affect the validity or effect of any statutory rules or regulati!)ns which a.re in effect or have tion Act, 1935." It is as follows: been in effect prior to the effective date of this act. Be it enacted, etc., This a.ct m.a.y be cited as the " Statutory SEC. 11. This act shall take effect 2 months following its enact­ Rules and Regulations Publication Act, 1935.'' ment. The regulations provided for in section 3 of this act shall SEC. 2. As used in this act-- be established prior to such effective date. The term "statutory rules and regulations" means- (a) Proclamations by the President; (b) all Executive orders Mr. MAY. Will the gentleman yield further? by the President, including all instances of the exercise by the President of any power conferred on him by statute; (c) all rules Mr. CELLER. Certainly. and regulations, by whatever name called, promulgated by any Mr. MAY. Has the gentleman read a bill that has been executive department, administration, independent establishment, introduced in the Senate to establish a court for the purpose board, commission, official, group of officials, or other rule-making authority; and (d) all other rules, regulations or orders, by what­ of construing and administering regulations and Executive ever name called, made directly or indirectly under the expressed orders of the Government? or implied authority of any act of Congress. Mr. CELLER. I am sorry I have not read that, but I do The term "rule-making authority" includes every authority authorized to make any statutory rules and regulations. believe we are coming to a situation in this country which SEC. 3. (a) All statutory rules and regulations made after the France has come to, where there are two sets of courts, as effect ive date of this act shall forthwith after they are made be it were, one for legislative law and one for administrative sent to the Public Printer, and shall, in accordance with regula­ tions made by the Secretary of State and the Attorney General, law; the administrative law embodying all these rules, regu­ with the approval of the President, be numbered in consecutive lations, and decrees of the various executive departments; whole numbers (the numbers to start anew annually), and. and in France they have a separate court to interpret and except as provided by the regulations, printed and sold by him. evaluate and determine what shall be done concerning these (b) Regulations made under the authority of this section may provide for the different treatment of statutory rules and regu- rules and regulations concerning administrative law. 1935 CONGRESSIONAL RECORD-HOUSE 591 Mr. DONDERO. Will the gentleman yield? ing out· of a plan which has been accomplished in every Mr. CELLER. I yield. Anglo-Saxon country of the world, England, Canada, New Mr. DONDERO. Would the gentleman not be willing to Zealand, British India, Australia, South Africa; France bas go further and say that these rules and regulations ought a complete codification of all the rules and regulations that to be codified the same as the laws of Congress? have ever been issued in that country. Official gazettes Mr. CELLER. I meant to say that in answer to the dis­ containing these rules are frequently published in Latin tinguished gentleman from Kentucky [Mr. MAY]. They countries. shall be codified. My bill provides for it. I believe that Mr. ROBSION of Kentucky. Mr. Chairman, if the gentle­ the rules and regulations heretofore issued, which now have man will yield, confirming what the gentleman said, I ob­ the force and effect of law, probably occupy tens of thous­ served, and doubtless he has, too, that one Federal judge held · ands of pages. They cover every conceivable branch of our up action in a case in a western State because the party Government, and nobody knows where or what they are. depending upon an Executive order could not produce it. Nobody knows what they are until some enterprising clerk Mr. CELLER. That is exactly the point I am trying to in a department wants to get after somebody and he resur­ make. You will find the same situation existing in other rects some old regulation and then there is difficulty. jurisdictions. I, personally, have already been interested in Mr. DONDERO. Does the gentleman believe that is the the trial of a case where the defendant was alleged to have way we should legislate? been a violator of rules and regulations. We could not find Mr. CELLER. No; I do not believe we should, and that is the regulation for a long period. why I offered this resolution in order to bring order out The vice of the whole situation of haphazard making and of chaos and destroy this confusion which now exists. I publishing Executive orders is all the more brought out in have been besieged time and again by constituents of mine sharp relief when you consider the many departments and who want to know something about these rules and regula­ agencies issuing them. There is the Agricultural Adjustment tions of the various departments, and I can furnish very Administration. The regulations from this Agricultural little information. Adjustment Administration, which cover hundreds, if not Mr. CHRISTIANSON. I, too, am in sympathy with the thousands, of pages, are all the more complicated by amend­ purpose the gentleman is trying to accomplish, but I want ments, substitutions, and supplements. In the Treasury to ask how much relief it would be to the average citizen to Department there are the customs regulations and the inter­ give him the opportunity to dig through a hundred thousand nal-revenue regulations, all in a constant state of flux. The pages-is that what the gentleman stated? Labor Department has its immigration rules and regulations. Mr. CELLER. There might be that number. In the Post Office Department you will find a huge, bulky Mr. CHRISTIANSON. Even if they were of record in the volume of rules. They are constantly being amended. The office of the Secretary of State. ·would not many of them Veterans' Administration already has two large volumes of inadvertently violate some of those provisions and make regulations, many of which already are out of date. There themselves subject to some criminal prosecution? are the elaborate and voluminous pure food and drug regu­ Mr. CELLER. The gentleman is correct. But at least lations. Then there are the Federal Farm Board, Securities there would be knowledge of the regulations and their and Exchange Commission, Federal Communications Com­ provisions. mission, Federal Housing Administration, Home Owners' Mr. CHRISTIANSON. I do not believe we should have Loan Corporation, Federal Farm Loan Board, Civil Service laws making the violation of an Executive order a crime Commission, Farm Credit Administration, all issuing their for which a man might be punishable. own regulations having the full force and effect of law. It all Mr. CELLER. That is something that ought to be rea­ becomes a mystic maze. Often a statute is passed by us soned out carefully and considered. which makes direct reference to a set of previous rules and Mr. CHRISTIANSON. It seems to me we are in a some­ regulations. Therefore, unless you can readily find and have what anomalous position as a free nation when we require knowledge of the rules referred to, the effect of the statute is every one of our 125,000,000 citizens to dig through 100,000 meaningless. Proper codification of these rules will bring pages or more of Executive orders filed in the office of the them within range and make the statute based upon them Secretary of State in Washington in order to keep out of understandable. jail. We have often authorized executive officers to decide when Mr. CELLER. I am not entirely in accord with the gen­ a statute shall become effective or when its operation shall tleman's statement, but I do feel that careful consideration be suspended. Executive orders in such instances are of should be given the matter. primary importance and should be easily ascertainable. Mr. ROBSION of Kentucky. Mr. Chairman, will the We have often passed statutes giving the right through gentleman yield? Executive orders to amend or repeal our acts. In such cases. Mr. CELLER. I yield. it is of paramount importance to know where to locate the Mr. ROBSION of Kentucky. I noticed a statement in the Executive orders thus amending or repealing our acts. press that more than 10,000 Executive orders have been It is perfectly legal for us to declare that violations of issued during the present administration. Is this informa­ the Executive orders shall be criminal offenses. This power tion correct? has been upheld in many cases. (See U.S. v. Gremand, 220 Mr. CELLER. I obtained my information from the Har­ U. S. 506 (1911) ; McKinley v. U. S., 249 U. s. 397 (1919) ; vard Law Review. I believe the figures I gave you are Avent v. U.S., 266 U.S. 127 (1924)_.) accurate. The very first act that we passed in the Seventy-third Mr. ROBSION of Kentucky. How many of these were Congress~ on the first day of the special session, was an act actually issued by the President? . granting to the President the power to prescribe regulations Mr. CELLER. The statement says 1,400 pages involving concerning gold. We made the violation of these Presiden­ 674 Executive orders had been issued up to the 4th of March tial regulations a criminal offense, subjecting the violator 1933, and that during the fi.Tst 15 months a1ter that date he to a fine of $10,000 or to imprisonment for not more than has issued even more than that. From March 4, 1933, to 10 years. In fact, numerous prosecutions have been brought October 15, 1934, the President issued 949 Executive orders. under this statute. Tariff Act of 1930 the utes to the gentleman from California [Mr. BucK]. duty on 96° sugar was fixed at 2.5 cents per pound, and by Mr. BUCK. Mr. Chairman, I have today introduced a bill virtue of the Cuban preference the duty on 96° Cuban sugar to authorize appropriations for the improvement of naviga­ was 2 cents per pound. On May 9, 1934, President Roose­ tion and the control of destructive flood waters of the Sacra­ velt reduced the general rate to 1.875 cents per pound under mento and San Joaquin Rivers in the State of California. the flexible-tariff provisions. The Cuban rate thereby be­ The expenditures of these moneys will be intrusted to the came 1.5 cents. Under the reciprocal agreement recently Central Valley water authority under the terms of this bill, concluded with Cuba, the President has further reduced the a State authority created by the people of California through rate on Cuban sugar to nine-t,enths of 1 cent per pound. their legislature and approved by the people at a referendum This is 1.1 cents per pound less than the rate originally pro­ election. vided by Congress in the Tariff Act of 1930 and is equivalent An identical bill has been introduced by the gentleman to a reduction of 55 percent below that rate. from California [Mr. STUBBS]. The gentleman from Cali­ Mr. KNUTSON. Will the gentleman yield? fornia referred to this bill a few moments ago in his request Mr. TREADWAY. My time is going to be very short if for permission to extend his remarks. I yield. The text of the bills will be printed in connection with the Mr. KNUTSON. This might be a very pertinent inquiry. remarks of the gentleman from California [Mr. STUBBS]. Mr. TREADWAY. I yield to the gentleman from Minne­ These bills fallow the lines suggested by the Engineering sota. Department of the State of California. It is my intention, as Mr. KNUTSON. It might be pertinent to note that Vin­ soon as certain details are perfected, to introduce for myself cent Astor is one of the most heavily interested Americans a second bill which will authorize the creation of a strictly in Cuban sugar. Federal authority along the lines or · the Tennessee Valley Mr. TREADWAY. I have no knowledge of that fact, but Authority, which will be directed to perform the same work undoubtedly the gentleman is correct in his statement. of the protection of irrigation development, of flood control Mr. HARLAN. Will the gentleman yield? and navigation on these rivers, and the production of power Mr·. TREADWAY. I yield to the gentleman from Ohio, as contemplated by the bills introduced today. I sincerely but I must decline to yield further. hope the Members of Congress will take these bills to heart Mr. HARLAN. Just as a matter of information, I wonder and study them seriously, compare them in their two differ­ if the gentleman would include in his remarks in listing the ent methods, so that if it becomes necessary to legislate concessions that we have made to Cuba the concessions that seriously on these questions the Members may be fully in­ Cuba has made to us? formed of what is in the minds of our people, and consider Mr. TREADWAY. I should like to know the concessions what will be best for the welfare of that great.territory, the that have been made by Cuba to our industries. Central Valley region of California. [Applause.] · Mr: HARLAN. I would be interested in the concessions Mr. Chairman, I yield back the remainder of my time. that Cuba bas made to us. Mr. DITTER. Mr. Chairman, I yield 20 minutes to the Mr. TREADWAY. I am interested in our people, not the gentleman from Massachusetts [Mr. TREADWAY]. Cuban folks. Mr. TREADWAY. Mr. Speaker, I ask unanimous consent This reduction in the duty on sugar is made at the expense to revise and extend my remarks in the RECORD and to in­ of the cane · producers ·of Louisiana and Texas, and the clude certain official statements made by different people in sugar-beet farmers of Colorado, Michigan, Utah, Nebraska, relation to the reciprocal tariff. California, Idaho, Ohio, and other States. It has not re­ The CHAIRMAN. Is there objection to the request of the dounded to the benefit of the consumers of this country, gentleman from Massachusetts? but has gone to increase the profits of the American capital­ There was no objection. ists who control the production of sugar in Cuba. POTATOES REPEAL OF THE PRESIDENT'S AUTHORITY TO NEGOTIATE RECIPROCAL TRADE AGREEMENTS Take the item of potatoes. The rate on Cuban potatoes Mr. TREADWAY. Mr. Chairman, under the Reciprocal has been reduced to 30 cents per hundredweight during the Tariff Act the Congress has sulTendered its power over the 3 months of each year beginning December 1. The statutory tariff to the Executive, and we now find the latter, through rate on potatoes, as fixed by Congress in the Tariff Act of his representative, the Secretary of State, sitting down with 1930, is 75 cents. Thus the reduction amounts to 60 percent representatives of foreign countries to formulate this coun­ of the established rat~. Of course, the President is limited try's tariff policy. In other words, we have the amazing to a reduction of 50 percent, but in the case of Cuba this situation of foreign nations having more to say about this limitation applies to the existing preference rate, which country's affairs than the elected representatives of the was 60 cents per hundredweight. people. Now, what sections are going to be harmed by this conces­ AGREEMENT WITH CUBA sion. Maine, of course, is by far the largest domestic pro. For example, under the trade agreement. which the Presi­ ducer of Irish potatoes. Other important producing States dent recently concluded with Cuba, of which Congress had are Idaho, Minnesota, New York, North Dakota, Wisconsin, no knowledge until it was put into effect, the tariff rates on Wyoming, Vermont, Nebraska, Michigan, and Washington. a large number of articles have been reduced in return for The potato farmers in these States are being forced to give reciprocal concessions by Cuba. It so happens that many up a certain portion of the domestic market to Cuban potato of the reductions have a very detrimental etiect upon certain producers in order that some other domestic industries maJ; agricultural and industrial sections of the country.. have freer access to the Cubaµ market. While the reduction 1935 CONGRESSIONAL RECORD-· HOUSE 593 in duty applies during only 3 months of the year, this is It will be recalled that when the Reciprocal Trade Agree­ sufficient to destroy the domestic price structure and thereby ments Act was under consideration in the House, no provision reduce the income of our own producers. was made for any notice to interested parties even of an TRADE WITH CUBA " intention " to negotiate an agreement. I offered an amendment to the bill which would have required the Pres­ Let us look at the statistics concerning our· trade with ident to give interested parties a full hearing on any pro­ Cuba. In 1929, this country spent $209,000,000 in Cuba, prin­ posed agreement, but this amendment was voted down by cipally for sugar, while that country took about $127,000,000 the Democratic majority. However, when the bill reached of our products. In 1933, the ratio was $58,000,000 to $25,- the other body, the administration forces, realizing the un­ 000,000, or more than 2 to 1 against this country. Under fairness of the bill in its original form, condescended to the trade agreement recently consummated, the State De­ require the President to give notice of his intention to nego­ partment hopes to increase our exports to Cuba. But at tiate an agreement, without specifying its contents, and to what price? By increasing our purchases of Cuban sugar, allow industries to present their views to the President or to the detriment of our own producers in all sections of the to such ·agency as he might designate. country. The State Department does not hope to get a bal­ After the passage of the act, the President set up the ance of trade in our favor, because that would be virtually Committee for Reciprocity Information to hear the views of impossible. We simply increase our purchases in Cuba and interested parties. This committee is composed of repre­ piously hope that Cuba will buy more from us. In the end, sentatives of the several departments, but they have no instead of spending $2 in Cuba for every $1 of trade we power other than to receive evidence and transmit it to ·receive in return, we probably will be spending $3 or $4. those carrying on the actual negotiations. Our farmers will no doubt be interested to note that prac­ Now, how does this arrangement work out? I have stated tically all of the concessions granted to CUban products re­ that on July 3, 1934, the Secretary of State gave notice of late to agriculture. In addition to the cane growers, the his intention to negotiate an agreement with Cuba. Accom­ sugar-beet producers, and the potato farmers, many other panying that notice was a statement to this effect: agricultural producers will be adversely affected. The pro­ The Committee for Reciprocity Information has prescribed that ducers of winter -vegetables, such as tomatoes, cucumbers, all information and views in writing and all applications for sup­ ·eggplant, okra, peppers, and squash, in the whole tier of plemental oral presentation of views shall be submitted to the Southern States will have a diminished domestic market and chairman of said committee, care of the United States Tariff Com­ mission, not later than 12 o'clock noon, July 21, 1934. Oral lower prices. The tobacco producers in a large number of presentation of views by persons whose applications therefor have States, including my own, will find their domestic market been approved_will be heard July 23, 1934. curtailed by increased importations of Cuban tobacco and Regulations of the committee governing the form and manner tobacco products at greatly reduced rates. The grapefruit of presenting views in connection with proposed foreign-trade agreements were made public today and also will be published in producers of Florida and Texas will have to meet increased Press Releases of the Department of State, the weekly Treasury competition with a duty of only six-tenths of 1 cent per Decisions, and Commerce Reports. pound against Cuban grapefruit. The regulations referred to in the foregoing notice simply ; Only a few industrial products are covered in the agree­ provide that information shall be presented to the Commit- 1 ment, owing, of course, to the lack of industrial development tee for Reciprocity Information in the form of written in Cuba. However, when the negotiations are completed statements, duly sworn to. Supplementary views may ·be with some of the European and oriental countries, we may presented to the Committee only upon. application to the expect to see reductions made in the duties on large numbers chairman and after written statements have been submitted , of manufactures. in proper form. OTHER COUNTRIES Thus we have this situation. On July 3, 1934, notice was At the present time only one agreement has been· con­ given of an intention to negotiate an agreement with Cuba. cluded-that with Cuba; but negotiations have already been No. intimation was given as to the articles to be dealt with begun with some 15 other nations, including Colombia, Haiti, in these negotiations. Yet every domestic industry produc­

Brazil, Costa Rica, El Salvador, Guatemala, Honduras, Nica­ ing articles and commodities which might be affected by 1 ragua, Belgium, Sweden, Spain, Switzerland, Finland, the the secret negotiations with Cuba was supposed to present ; Netherlands, and Italy. Preliminary negotiations are doubt­ its views to the Committee within 18 days, and to argue its less under way with other countries, of which no public case orally 2 days later-July 23. notice has as yet been given. Thus we will soon be throwing No person had any knowledge whatsoever of what was open our domestic market to the whole world. being considered by the committee. Further than that, and · STAR-CHAMBER METHODS I refer to this in some detail, it was almost impossible to In this connection I should like for a few moments to refer gain admission to that hearing on Cuban reciprocity. They • to the manner in which these star-chamber negotiations are did not want the public to know, or the Members of Con­ carried on. The Reciprocal Trade Agreements Act dele­ gress or the country to know, but eventually an agreement gates the authority to negotiate the agreements to the Presi­ was signed between the Secretary of State of the United dent, but, as was expected, he has turned the actual details States and the Secretary of State of Cuba, establishing a over to the State Department. law for the government of the people of the United States · The preliminary negotiations are carried on in secret, be­ and taking out from under many of these industries to • hind closed doors. The public has no knowledge of what which I have referred the prop of a tari1f protection to 1 duties foreign nations seek to have reduced nor of what con­ which they were entitled. cessions our representatives seek in return. The first notice What happened on the day set for the oral hearings? I i given consists in an announcement by the State Department was in Massachusetts at the time and consequently was . that negotiations are under way with a certain country. unable to be present, but I had a personal representative , For example, in the case of the recent agreement with Cuba, attend in my stead. In order for him to gain admission to 1 the following announcement was given out by the Secretary the hearing, he had to fill out a questionnaire and wait 1 of State on July 3, 1934: outside while the committee determined whether he should I be admitted. Thus even the hearing was not public. Pursuant to section 4 of an act of Congress approved June 12, 1934, entitled "An act to amend the Tariff Act of 1930 ", and Execu­ At this hearing were representatives of the fruit and veg~· tive Order No. 6750, of June 27, 1934, I hereby give notice of inten­ table, tobacco, and sugar industries. They naturally as­ tion to negotiate a foreign-trade agreement with the Government sumed that their products would be dealt with in any , of the Republic of Cuba. negotiations with Cuba, and attempted to show the com- I That was all the announcement stated-that this Govern­ mittee that any reduced tariffs would be detrimental to their ment had an " intention" of negotiating an agreement with respective industries. They did not know for certainty that-t Cuba. their products would be affected, or. if so, to what exte~ LXXIX---38 594 CONGRESSIONAL RECORD-HOUSE JANUARY 17 reductions would be made. In presenting their cases, they investment to a $25,000,000 plant. They were not allowed to had to "shoot in the dark", so to speak. do so under the quota. They could not make another pound 'A representative of the New England tobacco producers of sugar on account of the large quantity of additional sugar made the statement before the committee that it was only coming in from Cuba. by chance that he had learned of the proposed negotiations Which is.better-to aid the Cuban producers of sugar under with CUba and expressed the opinion that a considerable the conditions in which the people live down there, or set part of the tobaceo industry did not know of the threatened up a plant in this country whereby we produce the cane or reduction in duties on their product. produce the beets and sell the sugar produced and manufac­ FALLACY OF HEARINGS tured here in our own country? There are gentlemen in this During the hearing the chairman of the committee, Hon. House much more familiar with that particular detail than Thomas Walker Page, interrupted a witness to state that I am, and I hope in due time we shall hear the complete story the function of the committee was simply to receive infor­ of the unfair treatment that is being accorded sugar pro­ mation and transmit it to the President or to persons he ducers and other agriculturists under the reciprocal-trade mi.ght designate. He emphasized that the committee had law. no information to give out concerning the possible contents Mr. CULKIN. Will the gentleman yield? of the proposed agreement. After stating that the purpose Mr. TREADWAY. I yield to the gentleman from New of the hearing was not to argue the pros and cons of the York. tariff but to receive concrete information, he indicated that Mr. CULKIN. Does the gentleman know that the Federal the committee would make no recommendations based upon Government is now spending $27,000,000 on the Casper­ the evidence gathered. Alcova project in Wyoming, which is only suited to the grow­ · The hearings, to my mind, are a farce. They are of no ing of sugar beets? benefit to our domestic producers. In the first place, in­ Mr. TREADWAY. Will they allow them to grow the beets? dustries do not know whether they will be affected. If they Mr. CULKIN. And at the same time cutting down the think-they will be affected, they do not know to ·what extent. quota will not permit them to raise the sugar beets. Moreover, they have little time to prepare their views after Mr. TREADWAY. May I ask the gentleman from Michi .. the intention to negotiate an agreement is announced. igan, who is familiar with this matter, the amount of reduc­ WoI:.Se still, they present their views to one agency, while the tion of beet sugar under this reciprocal ta.riff? I am sure actual negotiations are carried on by others, and the agency the information is available, and I yield to the gentleman to which they present their views has no power to act or from Michigan [Mr. CRAWFORD l to answer the question. even to make recommendations. Each time a new agree­ Mr. CRAWFORD. In 1933 the production of beet sugar in ment ..is announced the whole process has to be repeated. this country was 1. 756,000 tons. Under the reciprocal-trade Let me ask what good the hearings did the domestic agreement and the Jones-Costigan Act we are limited to sugar producers, or the domestic tobacco growers, or the 1,510,000 tons, which is 206,000 tons less than we produced in domestic fruit and vegetable producers? In spite of the con­ 1933. This year, 1935, we expect to import into this country vincing arguments advanced by them in opposition to any from Cuba sugar which represents 283,000,000 hours of labor. reduction in duties, did not the President reduce the rates In other words, 100 pounds of sugar represents 8 hours of .on their commodities by from 17 to 50 percent? labor. Each bag of sugar imported into this country from In effect, the hearings amounted to no more than an other conntries represents 8 hours of American labor. invitation to domestic producers to be present at their own Mr. TREADWAY. Is it not a fact that under the recipro­ funenil. Lik.e the Christians in ancient Rome who were cal-trade agreement there will be imported into this country thrown to the lions, they can only say," We who are about 300,000 tons of Cuban sugar that can be raised by the beet­ to die salute thee." sugar industry of the West or the cane-sugar industry of the I have pointed out that the intention to negotiate the South?. trade agreement with Cuba was announced July 3 and that Mr. CRAWFORD. That is correct. the oral hearings were held on July 23. I wish only to add Mr. TREADWAY. May I compare that method of treating that on August 24, less than a month .after the hearings our people by the Government with what I happen to know closed, the trade a.greement had been signed. to be the case in Canada? Mr. Chairman, that is a new type of legislation, never to To my certain knowledge the Canadian Government is at my knowledge known before, when a law is passed binding this very moment considering guaranteeing principal and in­ the people of this. country, to that of which they have no terest on bonds necessary to erect additional beet-sugar mills previous knowledge and to which they have given no con­ in order to increase the domestic production of beet sugar sideration whatsoever. This is an agreement between an nearly 200 percent. Compare this attitude of the Canadian ()fficial of our Government and an official of a foreign gov­ Government toward its industry and agriculture with what ernment. this country is doing to its producers under the reciprocal­ I hope that our interests, and particularly the agricultural trade agreement system. people of DUI country, will eventually bring to the SUpreme Mr. WOODRUFF. Mr. Chairman, will my friend yield? -Court of the United States the question for decision as to the Mr. TREADWAY. I yield. constitutionality of that method of enacting legislation to Mr. WOODRUFF. Does not the gentleman know that the -govern the people of our country. It will be a terrible over­ policy of Canada, as just outlined by the gentleman from :sight if some of these great industries that have been affected Massachusetts, is also the policy of every country in the by this agreement do not get the question squarely before the world, except the United States, that can in any way pro­ .Supreme Court. If they do, I think most of us can prophesy duce sugar? llle policy laid down by Canada is precisely correctly as to the result. that of every enlightened country in the world except the Naw, what has happened? I am going to insert some United States. figw-es in relation to the sugar quota, the tobacco quota. and Mr. TREADWAY. Will the gentleman tell me why this other quotas set up, but I want particularly to refer to the is not the policy of the United States under the present sugar situation in this detail. administration? A larger percentage of sugar is now brought to this coun­ [Here the gavel fell.] try from Cuba than has previously been brought here, and Mr. DITTER. Mr. Chairman, I yield the gentleman from under the quota a les$er quantity is allowed to be produced Massachusetts 10 additional minutes. by our own people. I visited a sugar plantation in Florida Mr. WOODRUFF. Mr. Chairman, will the gentleman Yield la.st year, and I am reliably informed that the people owning further? that property, developing an isolated, unoccupied section Mr. TREADWAY. I yield to the gentleman from Michigan. of the district represented by my good friend listening to me Mr. WOODRUFF. The gentleman from Massachusetts . now, put mQney into ,circulation. tJ;iere by p-µrchasing _cane, has asked me if I could explain why the administration and in their anxiety to develop it and hoped to increase their the Congress, at the request of the administration, had re- 1935 CONGRESSIONAL RECORD-HOUSE 595 duced the amount of sugar that the American farmer could Mr. KNUTSON. Will the gentleman yield? raise. I wish to say in re~onse to that question that this Mr. TREADWAY. I yield. particular action, and the action now being taken by the Mr. KNUTSON. Is it not true that a treaty is being administration under the provisions of the Reciprocal Trade worked out with Denmark whereby we shall take a great Agreement Act and t1·eaties, is based upon the mistaken quantity of butter from that country? theory that by denying the American farmer the right to Mr. TREADWAY. I have some interesting documents raise the f cod the American people eat and by denying the here from which I will quote later in the extension of my American workingman the right to produce the things in this remarks. I do not see any great enthusiasm on the part country the American people need rehabilitation of industry of the dairy people of this country for a treaty whereby and agriculture can be tirought about and prosperity returned Denmark shall be brought into competition with the to the country, with the i·eemployment of something like American farmer. eleven and a half million men now walking the streets looking Now, there is another interesting question. These star­ for jobs, with none to be had. chamber methods are considering a treaty with Belgium. . Mr. TREADWAY. In other words, I infer that the gentle­ The one great export from Belgium is cement. We are man from Michigan greatly prefers that the sugar used by being asked today to make very extended and large appro­ citizens of the United States be produced from the beets and priations from our Federal Treasury for public works. Of cane of this country rather than have a reciprocal-trade course, cement will be largely used. The biggest article agreement entered into taking away 300,000 tons of that of construction will be cement. Sections of our country product now in favor of Cuba? manufacture cement. Pennsylvania is greatly interested in Mr. WOODRUFF. The gentleman is entirely correct. the manufacture of cement. But it is proposed to make Mr. TREADWAY. I thought that was the gentleman's reciprocal reductions on the duty on cement in order that position. they may lay down here, in the ports along the American Mr. HOOK. Will the gentleman yield? seaboard, Belgian cement to go into the construction of Mr. TREADWAY. Very briefly. public buildings and public works paid for from our Treas­ Mr. HOOK. Has there not been the same practice fol­ ury. Justify that if you can. lowed for many years from the Republican administration I am told that every thousand barrels of cement brought down through the various administrations to give the same here from a foreign country means the loss of 150 hours treatment to the copper industry and the iron industry that of American labor in Pennsylvania. is now given to the beet industry? Mr. DITTER. Will the gentleman yield? Mr. TREADWAY. There has never been a trade agree­ Mr. TREADWAY. I Yield. ment entered into that did not come back to Congress in Mr. DITI'ER. Is it not a fact that the decrease of some form or other for confirmation by the representa­ cement production in this country becomes all the greater tives of the people of the United States. That will answer as the Belgian cement is used in public works paid for out the gentleman, and I now prefer not to be interrupted again of the Treasury? along that line, because I know the gentleman's line of Mr. TREADWAY. That is what I am attempting to argument. He is trying to represent that the Republican bring out-that the representatives of Belgium want to fur­ Party did what you are trying to do now, and we never did. nish the cement that goes into our public buildings paid for You can never find a time when the question of the con­ out of the Federal Treasury. stitutionality of any act of a Republican administration Mr. FISH. Will the gentleman yield? with respect to the tariff has been successfully challenged Mr. TREADWAY. I will. in the courts, where your actions are being taken today. Mr. FISH. Is it not a fact that the use of Belgian glass Mr. HOOK. What I am asking is this: If the sugar in­ will cut down the production of our factories here? terests are given this protection, which I think they are Mr. TREADWAY. Yes~ glass will be used also. If Bel­ entitled to, then I am asking that same protection for the gium can get their glass and cement here under some favor­ copper and the iron industries. able tariff condition, the producers here will have to cut their Mr. TREADWAY. That is a different subject from the prices to correspond to the imported article. one we are discussing. So far as I know, copper and iron Mr. HARLAN. Mr. Chairman, will the gentleman yield? have not entered into the question. Mr. TREADWAY. Yes. Mr. HOOK. It is the same principle. Mr. HARLAN. Just what commodity is it that we are Mr. WOODRUFF. The gentleman's administration can going to export to Belgium that will give employment in this give it to them if it wants to do so. country to take the place of the cement that we are going to Mr. TREADWAY. Yes; that is a matter for the gentle­ import? man's ·administration. Mr. TREADWAY. Let me illustrate that by automobiles. The question has been brought up as to the quantity I do not know whether it is automobiles that are going to of sugar that was being raised, both in this country and in Belgium or not, but it is a fact that it is stated that m:Jrc Cuba, and I have some interesting figures here of the automobiles will be shipped from Michigan to Cuba as a re­ tonnage, and I shall elaborate on them in my extension with­ sult of this reciprocal trade, through bringing in Cuban sugar, out going into it now. but I state very definitely and positively that one county in We imported from Cuba, in 1933, 1,601,000 tons, and we Michigan will buy more Mi.chigan-produced automobile::: consumed in this country 93 pounds per capita during that than would be sent to Cuba in exchange for 300,000 tons of same period. Cuban sugar. · So the use of sugar dropped from 108 pounds to 90 pounds, Mr. HARLAN. But there has to be equality of value. and at the same time we have consistently increased the Mr. TREADWAY. No; there does not have to be equality quantity of sugar being brought to this country in spite of of value. It may be all one-sided. We reduce our tariff the lower per capita consumption. I cannot for the life of rates in favor of Cuban products, but Cuba does not have to me see where any sensible man representing the people of take a single dollar's worth of goods in return. All she agrees this country can approve of that sort of conduct. to do is reduce certain of her tariff rates, and whether we Now it is not limited to sugar. The gentleman from New ship any goods to Cuba depends on whether we can under­ York yesterday explained the situation as regards matches. sell the rest of the world, even with the reduced tariff. It seems that there is a great group of capitalists here ar­ The Secretary of State is a free-trader of the worst kind, ranging for a change of the duty on Swedish matches. and he is the one who is putting this game across. You do not suppose that they want to raise that duty for Mr. HARLAN. Does the gentleman say that we are going the benefit of the American producer. On the contrary, to continue to buy sugar and cement-- their only object is to make some kind of a deal or trade Mr. TREADWAY. It looks to me as if the administration whereby our industry in producing matches shall be wiped wants to favor foreign production over American production. out. That is the picture. There is no question about that. Some 596 CONGRESSIONAL RECORD-HOUSE JANUARY 17 day the American people will wake up to that fact and de­ discretion is the test of the legislative power which the Presi­ mand that American production take precedence over foreign dent has under the act, and it is this discretion which vitiates importations. the entire set-up. From time to time trade agreements will be concluded with If the agreements arrived at by the President under the act other countries. I have already named those with which are not valid as Executive agreements, neither are they valid negotiations are now being carried on. We may expect to as treaties, since they are not subject to ratification by the hear soon that our domestic watch producers have been put Senate nor to approval by the House of Representatives. out of business and their employees thrown out of work by I have introduced a bill-H. R. 3422-to terminate the reductions in the duty on Swiss watches. We may reason­ President's authority to negotiate any further trade agree­ ably expect to wake up some morning and find that certain ments. I hope that it will be enacted; but even if passed by a branches of the agricultural industry have been crippled by majority of the two branches, it would be necessary to have reductions in the duty on butter and cheese from the Nether­ a two-thirds vote to override a Presidential veto, which lands, on wheat from Canada, on meats and hides from probably would be forthcoming. Argentina, and so on. We may expect to find our brick and I am firmly convinced that if this act could be brought cement industries destroyed by a reduction in the duty on before the Supreme Court for review it would be declared importations of these products from Belgium. There is no invalid, and in that event my bill would be unnecessary. The end to the possibilities, and the possibilities in most cases difficulty with this course, however, is that it would take a will, I am sure, turn out to be probabilities. long time to bring a case before the Court, and in the mean­ I want to say here and now with all the emphasis at my time much damage could be done to domestic industries. I command that I am unalterably opposed to this star-chamber firmly believe that as additional trade agreements are con­ method of procedure in regulating our tariff rates and in cluded, and the reductions in duty thereunder put into effect, dealing with our domestic industries. What right under there will be a loud and increasing demand upon the part of the sun do representatives of foreign countries have to dic­ the people of this country that the Trade Agreements Act be tate our tariff rates, or to have a part in fixing them? The repealed. It cannot possibly be of benefit to the country as a Constitution gives to Congress alone the power to fix tariff whole; and while it might conceivably benefit certain groups, duties and to regulate commerce with foreign countries. it would hurt many more. Thus it is clearly class legislation. Nothing is said therein about allowing foreign nations to EXPERIENCE WITH RECIPROCITY have a hand in the matter. Our past experience with reciprocity is not encouraging, CONSTITUTIONALITY OF LAW and world conditions today are less favorable for it than they This leads me to another point. There also is nothing were years ago, since each nation is trying to become self­ said in the Constitution about the President's having the contained and self-sustained. Our people will soon awaken power to fix tariff rates and negotiate treaties without the to the fact that the domestic market is more important than advice and consent of the Senate. When the reciprocal­ the foreign market, since we consume in this country 90 tariff measure was under consideration in the House, I en­ percent of what we produce. Our farmers realize that if deavored to point out that Congress, in giving such broad domestic industries must be destroyed to secure a larger mar­ authority to the President, was doing an unconstitutional ket for their wheat and pork, they will be the eventual losers, act. Only a few days ago the Supreme Court of the United since the best customer they have is the American workman, States confirmed my stand when it said that Congress could who is the highest paid in the world. not delegate legislative authority to the President. If we are going to seek larger foreign markets, we must be There are two ways in which this country could conduct prepared to meet world competition, and this means low trade negotiations with foreign countries-namely, through production costs. Our standard of living would have to be treaties and through valid Executive agreements. · Under lowered to that of Europe and the Orient, fewer men could the Constitution, the President has the power to negotiate be employed, sweatshop working conditions would prevail, treaties, but they must be confirmed by the Senate, and and wages would have to be reduced to a fraction of what when they affect the revenue the House has always insisted they now are. Is it worth the price? on a concurrent right of ratification. Under permission to extend, I desire to submit the follow­ Executive agreements, on the other hand, are negotiated ing memorandum regarding sugar importations into this and concluded exclusively by the President, but only under country from Cuba: specific authority of Congress and pursuant to a definite Sugar imported into this country from Cuba, measured legislative policy laid down in advance in the act authorizing in short tons, raw value-2,000 pounds 96° sugar-amounted such agreements. The reciprocal agreements conducted in- under the McKinley tariff of 1890 are an example of this Tons farm of negotiation. There Congress put certain named ar­ 1931 ------1,857,022 ticles on the free list, with a proviso that if any country 19321933 ______------1,601,0001,762,000 which exported those articles to the United States imposed 1934 ______1,901,752 unreasonable duties on our products, the President should suspend the free entry of such articles from that country The total consumption of all sugars in the United States and put into effect certain rates of duty prescribed by Con­ for- gress in the act. Thus, under this type of arrangement, the Pounds President merely carries out the policy previously laid down Per capita 1929 ------108.13 by Congress. He has no discretion in the matter, either as 1930 ------99. 37 to putting the rates into effect or as to what they should be. 1931 ------98.47 In other words, under a true Executive agreement, the 19331932 ______------93.6093 . 29 President exercises no legislative authority. 1934 ______90.71 If the trade agreements negotiated by the President under the reciprocal-tariff act are alleged to be Executive agree­ Thus it will be seen that dming the 6-year period 1929 to ments-and that is what the act says they are-then they 1934, inclusive, our consumption dropped from 108.13 pounds are clearly unconstitutional, and will be so held by the per capita to 90.71 pounds per capita, or a decrease of 16+ Supreme Court just as soon as a case can be brought before percent. it. Anyone reading the act will see that the President has In 1933 the beet-sugar industry of the United States pro­ full discretion as to whether he will negotiate an agreement duced in short tons, refined value, approximately 1,725,000 with any country; that he has full discretion as to the arti­ tons of sugar, and, in addition, the production of our island cles to be dealt with in the negotiations; and that he has full possessions, Puerto Rico and Hawaii (not to mention the discretion in determining the amount of the reduction in Philippines) , stepped up their production, all of which was rates, subject to the general limitation of 50 percent. This benefiting our own people, citizens under the American flag 1935 CONGRESSIONAL RECORD-HOUSE 597 and for whom we are responsible economically and socially. in this country with the consequent increased consumption Cuba still participated in our market to the extent of of sugar in the form of ice cream, candy, candied fruits, and 1,601,000 tons as set forth above. sweetened preserves, cakes, and pies by our industrial work­ The Jones-Costigan Sugar Act, which was approved early ers engaged in mass production and with our continental in 1934, empowered the Secretary of Agriculture to restrict, producers receiving only 30 percent of the increased con­ through quotas, production of sugar, both beet and cane, sumption, one can fully appreciate what a great service we on our mainland as well as in Puerto Rico and Hawaii

Commodity Statutory rate (act of 1930) Cuban preference under 1903 treaty New Cuban rate (trade agreement) Pdercent. t re uc ion

Glycerin, crude------1 cent per pound ______0.8 cent per pound ______0.4 cent per pound ______Grapefruit oil, distilled or essential ______25 percent ______20 percent: ______10 percent______50 50 Cement floor and wall tiles: Valued at not more than 40 cents per square 10 cents per square foot but not less 8 cents per square foot but not less 4 cents per square foot but not less 50 foot. than 50 percent nor more than than 40 percent nor more than than 20 percent nor more than 70 percent. 56 percent. 28 percent. 48 percent______24 percent______Valued at more than 40 cents per square foot ... 60 percent______------50 Mahogany, not further advanced than sawed. ______15 percent plus $.3 per thousand 12 percent plus $2.40 per thousand 6 'percent plus $1.20 per thousand 50 board feet. board feet. board feet. 0.9 cant per pound ______Sugar (96'') _ ------­ 1.875 cents per pound'------· 1.5 cents per pound'------­ 40 $2.27~ per pound ______Wrapper tobacco, and filler tobacco when mixed or $1.82 per pound __ ------$1.50 per pound __ ------17.6 packed with more than 35 percent of wrapper to­ bacco, if unstemmed. Filler toba<'co, n s. p. f.: 35 cents per pound ______28 cents per pound ______17.5 cents per pound ______UnStemmedstemmed ______------______-----______37.5 50 cents per pound ______40 cents per pound ______25 cents per pound ______37. 5 Scrap tobacco ______------_------35 cents per pound ______28 cents per pound ______17.5 cents per pound ______37. 5 Cigars, cigarettes, cheroots, paper cigars, and ciga­ $4.50 per pound plus 25 percent ____ $3.60 per pound plus 20 percent ____ $2.25 per pound plus 12~ percent__ 37.5 rettes, wrappers. Honey ______------~ - - 3 cents per pound ______2.4 cents per pound ______1.2 cents per pound ______1 cent per pound ______0.8 cent per pound ______0.4 cent per pound ______50 Fish, n. s. p . f., fresh or frozen (whether or not 50 packed in ice), whole, or beheaded or eviscerated or both, but not further advanced (except that fins may be removed). 2.5 cents per pound ______2 cents per pound ______1 cent per pound ______Fish, fresh or frozen (whether or not packed in ice), 50 filleted, skinned, boned, sliced, or divided into portions, n. s. p. f. Corn or maize, including cracked corn ______25 cents per bushel.______20 cents per bushel.______10 cents per bushel. ______50 Limes in their natural state______2 cents per pound ______1.6 cents per pound ______0.8 cent per pound ______50 Grapefruit (from Aug. 1 to Sept. 30) ______1.5 cents per pound ______1.2 cents per pound______0.6 cent per pound ______50 Pineapples: In crates------50 cents per crate______40 cents per crate______20 cents per crate______50 In bulk ______------1~ cents each______0.933 cent each_.------0.5 cent each __ ------46.4 Candied, crystallized, or glace_ ------­ 35 percent______28 percent______14 percent------50 Otherwise prepared or preserved, n. s. p. '-----­ 2 cents per pound ______1.6 cents per pound ______0.8 cent per pound ______50 Prepared or preserved in any manner, contain- $5 per proof gallon on alcohol con- $4 per proof gallon on alcohol con- $2.50 per proof gallon on alcohol 37.5 ing ~of 1 percent or more of alcohol. tained therein in addition to any tained therein in addition to any contained therein in addition to other duty. other duty. any other duty. Jelliest jams, marmalades (except orange marma· 35 percent------28 percent______14 percent------50 lade), and fruit bitters. Mango pastes and pulps, and guava pastes and _____ do_ ------_____ do ____ ------_____ do ____ ------50 pulps. Lima beans, green or unripe, in their natural state 3.5 cents per pound ______2.8 cents per pound ______1.4 cents per pound ______50 (from Dec. 1toMay31). White or Irish potatoes (from Dec. 1 to Feb. 28 75 cents per hundredweight______60 cents per hundredweight ______30 cents per hundredweight ______50 or 29). Tomatoes in their natural state (from Dec. 1 to 3 cents per pound ______2.4 cents per pound ______1.8 cents per pound ______25 Feb. 28 or 29). Cucumbers in their natural state (from Dec. 1 to _____ dO------_____ do_------1.2 cents per pound __ ------50 Feb. 28 or 29). Eggplant in its natural state (from Dec. 1 to Mar. 31) 1.5 cents per pound 1 ______0.6 cent per pound ______50 percent______1.240 percentcants per ______pound'------______50 Okra in its natural state (Crom Dec. I to May31) ____ _ 20 percent______50 2 cents per pound 1 ______Peppers in their natural state (Jan. 1 to A.pr. 30) ___ _ 2.5 cents per pound'------1.5 cents per pound ______25 Squash in its natural state (from Dec. 1 to May 31). 2 cents per pound ______1.6 cents per pound ______1.2 cents per pound ______$5 per proof gallon. ______25 Rum, in bottles of 1 gallon or Jess ______$4 per proof gallon ______$2.50 per proof gallon ______37.5 Sponges commercially known as velvet. ______20 percent______12 percent______2515 percent------percent______6 percent______40 Sponges, n. s. p. L------12 percent------50

1 General rate on sugar under Tarill Act of 1930 was 2.5 cents per pound (96°); on Cuban sugar, 2 cents. The rate was reduced by the President under the flexible-tariff provisions on May 9, 1934 effective June 8, 1934. 2 General rate on eggplant and peppers under act of 1930 was 3 cents per pound; rates reduced by Presidential proclamation under flexible-tariff provisionson Dec. 2, 1931, effective Jan. 1, 1932.

The following is a statement prepared by the National CUBAN RECIPROCITY TREATY DANGEROUS TO AGRICULTURE Dairy Union showing the dangerous effect on agriculture of If the Cuban Trade Agreement Treaty just signed is to be the the trade agreement with Cuba. I understand that the views pattern for other trade agreements, then diversified agriculture in the United States is in grave danger. There is a possible benefit expressed therein also are concurred in by the National in the Cuban treaty for growers of staple crops-eotton, rice, wheat, Grange. corn, and potatoes. It penalizes all other crops which farmers

.· 598 CONGRESSIONAL RECORD-HOUSE JANUARY 17 have been asked to raise as a relief from the overproduction of Mr. CANNON of Missouri. Mr. Chairman, I move that the staples. Particularly it penalizes tobacco, sugar, fruits, and vegetables. Dairy products as to which a Cuban market might the Committee do now rise. have been found are entirely ignored in the trade agreement. The motion was agreed to. All of the Cuban products admitted to the United States under Accordingly the Committee rose; and the Speaker having lower tariffs directly compete with domestic products. None of resumed the chair, Mr. GREENWOOD, Chairman of the Com­ the products admitted to Cuba under lowered tariffs compete with any Cuban product with the single exception of cigarettes. mittee of the Whole House on the state of the Union, re­ Cuban interests are benefited and domestic producers penalized ported that that Committee, hgving had under consideration by a tari1f reduction on sugar to 0.6 of a cent a pound under the bill H. R. 3973, the District of Columbia appropriation a quota agreement permitting Cuban shipments of approximately 2,000,000 long tons. What can Cuba buy that will grow on the bill, had come to no resolution thereon. cane fields and sugar-beet fields which will be left idle by this MESSAGE FROM THE PRESIDENT (H. DOC. NO. 81) arrangement? Eighteen percent more tobacco is to be imported from Cuba under this treaty and all tobacco at sharply reduced A message in writing from the President of the United duties. States was communicated to the House by Mr. Latta, one The most startling change in tariffs found in this agreement is of his secretaries. the "seasonal reduction" of rates on fruits and vegetables pro.. duced in Cuba. These Cuban products compete directly with the The SPEAKER laid before the House a message from the products of the Gulf Coast States: In general it can be said that President of the United States, which was read, as follows: the tariff on these competing farm products is reduced during the season from December 1 and spring when the domestic producer To the Congress of the United States: needs it most and can profit most by the present tariff. The In addressing you on June 8, 1934, I summarized the main changes provided for in the new trade agreement are as follows: objectives of our American program. Among these was, and is, the security of the men, women, and children of the Pre.sent New For what period Item rate rate Nation against certain hazards and vicissitudes of life. This purpose is an essential part of our task. In my annual mes­ Lima beans ______per pound__ $0. 028 $0. 014 Dec. 1 to May 31. sage to you I promised to submit a definite program of ac­ White potatoes______do ___ _ .60 .30 Dec. 1 to end of February. tion. This I do in the form of a report to me by a Committee Toma toes ______------____ do ___ _ .024 • 018 Do . Cucumbers______do ___ _ .024 .012 Do. on Economic Securities, appointed by me for the purpose Egg plant ______do ___ _ .012 .006 Dec. 1 to Mar. 31. of surveying the field and of recommending the basis of 0 kra ______percent __ 4.0 20 Dec. 1 to May 31. Peppers ______per pound __ .02 . 015 Jan. 1 to Apr. 30 . legislation. Squash ______------____ do ___ _ .016 . 012 Dec. 1 to May 31 . I am gratified with the work of this committee and of those Grapefruit______do ___ _ .012 . 006 Aug. 1 to Sept. 30 . Pineapples ______per crate __ .40 .20 At all times. who have helped it: The Technical Board on Economic Se­ curity, drawn from various departments of the Government; These reductions are from 25 percent to 50 percent below pre­ the Advisory Council on Economic Security, consisting of viously existing duties. The new rates are likely to permit so informed and public-spirited private citizens and a number large a volume of Cuban winter products in American markets of other advisory groups, including a Committee on Actu­ that they will establish a new low price level ruinous to all GuU arial Consultants, a Medical Advisory Board, a Dental Ad­ States producers. . On the part of Cuba, duties are reduced, as stated, on things visory Committee, a Hospital Advisory Committee, a Public Cuba does not produce at all-automobiles, cotton fabrics, wheat Health Advisory Committee, a Child Welfare Committee, and flour, pork products, vegetable oils, dried and evaporated fruits, an Advisory Committee on Employment Relief. All of those iron, steel, copper, lumber, and paper products. There is also a reduction in the tariff on cigarettes, of which Cuba is a small who participated in this notable task of planning this major producer. , legislative proposal are ready and willing, at any Ume, to Such domestic agricultural benefit as may come will be found consult with and assist in any way the appropriate congres­ in the possible increase in markets for cotton fabrics, wheat and pork products, evaporated fruits, and vegetable oils--the staples as sional committees and Members with respect to detailed compared with the specialty crops which have been penalized. In aspects. other words, this treaty sets one group of American farmers directly It is my best judgment that this legislation should be opposed in interest to another group of American farmers, a situa­ brought forward with a minimum of delay. Federal action tion which all farmers and their organizations have. sought in the past with much success to avoid and overcome. is necessary to and conditioned upon the actions of States. Cuba has been a great beneficiary from trade with the United Forty-four legislatures are meeting or will meet soon. In States. In 1924, the year of highest trade exchange, Cuba sold order that the necessary State action may be taken promptly, the United States $362,265,000 worth of her products, and we sold it is important that the Federal Government proceed to Cuba $191,571,000. Cuba was thereby enriched by over $170,- 000,000 of American money. In that year Cuba's purchases from -peed.ily. the United States included $12,000,000 worth of lard and $8,000,000 The detailed report of the committee sets forth a series worth of flour, just a trifle over 10 percent of our total sales to of proposals that will appeal to the sound sense of the the island. Cotton, wheat, and corn farmers should scrutinize these figures carefully before they accept the statement that this American people. It has not attempted the impossible, nor reciprocity business is for the purposes of relieving agricultural has it failed to exercise sound caution and consideration of surpluses. One hundred and seventy million dollars is too large a all of the factors concerned; the national credit, the rights bonus to pay to Cuba if only partially at the expense of other and responsibilities of States, the capacity of industry to farmers to provide a little relief for the wheat and hog producers. • • • • assm;ne :financial responsibilities, and the fundamental neces­ Just as the producers of winter fruits and vegetables have been sity of proceeding in a manner that will merit the enthusias­ seriously damaged by this treaty, so the producers of meats, hides, tic support of citizens of all sorts. dairy products,- flaxseed, wool, mohair, feed grains, cottonseed, It is overwhelmingly important to avoid any danger of peanut and soybean oils, citrus frUits, and other frUits and vege­ tables now stand in imminent danger of the same treatment by permanently discTediting the sound and necessary policy of this star-chamber proceeding. Agriculture must not be permitted Federal legislation for economic security by attempting to to be divided against itself. They must not permit the interest apply it on too ambitious a scale before actual experience of one or more commodities to be played up against the interest of other commodities. They must keep informed as to the mean­ has provided guidance for the permanently safe direction of ing of this new development which, if carried out along the line such efforts. The place of such a fundamental in our future of the Cuban Reciprocity Treaty, will ultimately let the products civilization is too precious to be jeopardized now by extrava­ of some other country into the United States to the damage and gant action. It is a sound idea-a sound ideal. Most of the possible ruin of every agricultural producer. Individuals and small units are powerless to protect their interests against this other advanced countries of the world have already adopted Rew secret tariff machine which has been set up. it, and their experience affords the knowledge that social The situation calls in the first place for forceful action through insurance can be made a sound and workable project. strong national organizations dealing· directly with the present tariff authorities and the administration. Three principles should be observed in legislation on this Even more important than this, the situation calls for every subject. In the first place, the system adopted, except for citizen who is concerned demanding political representation in the money necessary to initiate it, should be self-sustaining Washington that will either repeal the law which permits a for­ eign agreement of this character or at least amend it so that each in the sense that funds for the paYJ11ent of insurance bene­ step which the administration takes under the law shall be done fits should not come from the proceeds of general taxation. openly, before the public and under full light -of publicity. Second, excepting in old-age insurance, actual management 1935 CONGRESSIONAL RECORD-HOUSE 599 should be left to the States, subject to standards established We pay now for the dreadful consequence of economic in­ by the Federal Government. Third, sound financial man­ security, and dearly. This plan presents a more equitable agement of the funds and the reserves, and protection of the and infinitely less expensive means of meeting these costs. credit structure of the Nation should be assured by retaining We cannot afford to neglect the plain duty before us. I Federal control over all funds through trustees in the Treas­ strongly recommend action to attain the objectives sought in ury of the United States. this report. At this time, I recommend the following types of legisla­ FRANKLIN D. ROOSEVELT. tion looking to economic security: THE WHITE HOUSE, January 17, 1935. First. Unemployment compensation. Second. Old-age benefits, including compulsory and volun­ Mr. DOUSHTON. Mr. Speaker, I move that the message tary annuities. and the accompanying papers be referred to the Committee Third. Federal aid to dependent children through grants to on Ways and Means and ordered printed, and, on that, I States for the support of existing mother's pension systems move the previous question. and for services for the protection and care of homeless, The previous question was ordered. neglected, dependent, and crippled children. The motion was agreed to. Fourth. Additional Federal aid to State and local public A motion to reconsider was laid on the table. health agencies and the strengthening of the Federal Public DISTRICT OF COLUMBIA APPROPRIATION BILL, 1936 Health Service. I am not at this time recommending the Mr. CANNON of Missouri. Mr. Speaker, I move that the adoption of so-called " health insurance ", although groups House resolve itself into the Committee of the Whole House representing the medical profession are cooperating with the on the state of the Union for the further consideration of Federal Government in the further study of the subject and the bill H. R. 3973, the District of Columbia appropriation definite progress is being made. bill. With respect to unemployment compensation, I have con­ The motion was agreed to. cluded that the most practical proposal is the levy of a uni­ Accordingly the House res0lved itself into the Committee form Federal pay-roll tax, 90 percent of which should be of the Whole House on the state of the Union for the fur­ allowed as an offset to employers contributing under a com­ ther consideration of the District of Columbia appropriation pulsory State unemployment-compensation act. The pur­ bill, with Mr. GREENWOOD in the chair. pose of this is to afford· a requirement of a reasonably uni­ Mr. DITTER. Mr. Chairman, I yield 5 minutes to the form character for all States cooperating with the Federal gentleman from New York [Mr. TABER]. Government and to promote and encourage the passage of Mr. TABER. Mr. Chairman, in view of the large amount unemployment-compensation laws in the States. The 10 of misinformation which has been contained in letters and percent not thus offset should be used to cover the costs of statements in the newspapers with reference to the so-called Federal and State administration of this broad system. "Townsend plan" of old-age pensions, I feel that I should Thus States will largely administer unemployment compen .. make a public statement of my position with reference to sation assisted and guided by the Federal Government. An this matter. unem~loyment-comparison system should be constructed in In the first place, let it be considered that this is far more such a way as to afford every practicable aid and incentive than is required to maintain our old people in reasonable toward the larger purpose of employment stabilization. comfort. In the second place, the requirements of our people This can be helped by the intelligent planning of both public to be maintained in reasonable comfort are so far different and private employment. It also can be helped by correlat­ in the South than in the North that where many of our old ing the system with public employment so that a person who people who require such a thing as an old-age pension in the has exhausted his benefits may be eligible for some form of South where the climate is mild and warm, food and clothing public work, as is recommended in this report. Moreover, in requirements are less, and housing requirements much less, order to encourage the stabilization of private employment an aged man and his family will get along in luxury on $15 a Federal legislation should not foreclose the States from es­ month, where an old man and his family in the northern part tablishing means for inducing industries to afford an even of the country in the city with city rents to pay would starve greater stabilization of employment. to death. Therefore, to my mind the only proper way to In the important field of security for our old people it handle the old-age pension situation is through a State law seems necessary to adopt three princip1es: First, noncqn­ where the State legislatures will know the requirements of tributory old-age pensions for those who are now too old to their people. If there has to be temporary Federal aid to build up their own insurance; it is, of course, clear that for meet this on account of the present economic stress and in­ perhaps 30 years to come funds will have to be provided by ability of the States to borrow to meet their requirements, the States and the Federal Government to meet these pen­ this should be done. We should avoid, however, as far as sions. Second, compulsory contributory annuities, which in possible, discouraging thrift and discouraging the desirability time will establish a self-supporting system for those now of our people saving enough in their active years to take cal"e young and for future generations. Third, voluntary con­ .of their old age. tributory annuities, by which individual initiative can in­ With reference to the Townsend plan in particular, it calls crease the annual amounts received in old age. It is pro­ for the payment of approximately $2,000,000,000 a month or posed that the Federal Government assume one-half of the $24,000,000,000 a year. This means a 60 to 65 percent sales cost of the old-age pension plan, which ought ultimately to tax on all ultimate sales to consumers in the United States. be supplanted by self-supporting annuity plans. Perhaps it runs as high as 70 percent. If the tax should be The amount necessary at this time for the initiation of imposed upon each transaction from the original producer to unemployment compensation, old-age security, children's the ultimate consumer, it would pyramid your sales tax so it aid, and .the promotion of public health, as outlined in the would run from 75 to 80 percent. Such a sales tax would report of the Committee on Economic Security, is approxi­ absolutely destroy all trade and commerce and cause such mately $100,000,000. great distress amongst the young and old as to practically The establishment of sound means toward a greater future ruin them. In addition to that, it would cause uncontrolled economic security of the American people is dictated by a inflation, and the result would be even more disastrous than prudent consideration of the hazards involved in our national the spending program of the present administration because life. No one can guarantee this country against the dangers it would be three or fow· times as large. of future depressions, but we can reduce these dangers. We I am in the minority in Congress, but I feel that it is my can eliminate many of the factors that cause economic de­ duty as a Member of that minority to vote for those things pressions, and we can provide the means of mitigating their that I believe right and against those things that I know to results. This plan for economic security is at once a meas­ be wrong, regardless of whether they are sponsored by the ure of prevention and a method of alleviation. . administration or by those opposed to it. 600 CONGRESSIONAL RECORD-HOUSE JANUARY 17 Believing that the Townsend plan in execution would result Nobody knows with any degree of accuracy how many obli­ in a total collapse of the financial structure of the Govern­ gations payable in gold there are outstanding. I have heard ment very rapidly, I can do nothing but oppose it. an estimate of $100,000,000,000. It may be more; it may be The people have had the situation with reference to it mis­ less. There are something like $30,000,000,000 of those represented to them, and I feel it my duty to tell them the obligations that are public obligations. The remainder of truth about it regardless of its political effect. [Applause.] the total of something like $250,000,000,000 of outstanding Mr. CANNON of Missouri. Mr. Chairman. :i: now yield to debts in the United States is payable in any legal tender, the gentleman from Alabama [Mr. HUDDLESTON]. and the decision will not affect them. Mr. HUDDLESTON. Mr. Chairman, on June 5, 1933, Let me say this: That as the passage of the act had an Congress passed the act "to assure uniform va:lue to the effect on two fronts, so will the striking down of the act have coins and currencies of the United States." .By this act we an effect on two fronts. Those fronts are the psychological outlawed and declared void the provision in all contracts front, on men's minds; and the actual or direct front, the requiring payment in gold. effect which the decision may have upon prices, upon debts, The constitutionality of that act has been assailed, and it and upon other real things, an effect that is not due to a is now under consideration by the Supreme Court. · I rise state of mind or to man's emotions but of actualities and to discuss what might be the consequences if the Court economic laws. should decide that the act was beyond the power of Con­ When we passed the act making void the gold clause in gress and, therefore, void. I make no comment and express obligations, there was an enormous psychological reaction. no opinion as to what the decision should be nor what it That effect was not confined to this country. It extended to may be. That is a matter which the Court under its respon­ the remotest corners of the world. We did not pass the act sibility will pass upon, according to the lights before it. bec;ause the Government of the United States was unable to Also, I preface what I shall say by saying that it has no meet its obligations in gold. We did not pass it because of political aspect whatever; in the remotest degree it has no governmental poverty or need. We passed this act for the bearing upon partisanship. Particularly it must not be con­ purpose of relieving debtors who had given obligations pay­ strued as a criticism of the adininistration or of anything able in gold. Its sole purpose was to transfer a benefit from that the administration has done, nor is it intended as a what the agitators call the " creditor class " to what those defense of the administration or of anything that the same gentlemen with equal inaccuracy and with equal lack of administration has done. It is designed merely as my slight knowledge of what they are saying or what they mean call contribution to an analysis of the situation and toward the "debtor class "-for, of course, there is neither of such stability, reassurance, and confidence in the business and classes. We are all debtors and we are all creditors, and industrial world. those who have the biggest assets are, generally speaking, the In the course of the argument on the constitutionality biggest debtors. of this act before the Supreme Court an eminent gentle­ We passed this act. We struck down the promise of the man, high in the councils of the Government, took occasion United States Government and of the governments of all our to predict that if the Court should hold the act to be uncon­ States and cities and of many corporations and people to stitutional the result would be "chaos." That cue has been pay their obligations in a certain fashion and in certain taken in numerous circles. The press has spread it through­ terms. I have no desire to discuss the propriety of that out the country. I have read articles which stated as a action. I do say that its consequences were to strike a matter of fact that those who owed gold obligations would blow at the confidence of mankind such as this world has find themselves obliged to pay $1.69, I believe it was, for rarely felt before. We had prided ourselves upon our rec­ every dollar in the face of the obligation. ord of keeping our solemnly pledged word. We had said In my judgment the general impression grossly overesti­ that the pledged word of the United States was its obliga­ mates the effect of such a decision by the Supreme Court. tion and will be kept and honored at all times and every­ It seems to me that its probable effect is exaggerated by where. We had said that when we engaged with our sister the unthinl,ting, so that it behooves all of us to analyze the nations, we would comply with our treaty obligations to the situation, to decide what is involved, and to endeavor not remotest detail. · to frighten the people of this country beyond what may be When we passed that act, we said,' " We repudiate the obli­ justified. gation that we gave. We will not do what we said we Let us bear in mind that on June 5, when this act was would do." The gold clause in our national bonds took its passed, all gold had been withdrawn from circulation and place with a" scrap of paper" and all the broken treaties and the possession of gold, either for. payment of an obligation violated promises of the past. Our action not only shook or in receipt of such payment, had become a crime. It was the confidence of the world and contributed to the mistrust impossible, therefore, at that time not only for anyone to and distrust among nations and to the lack of international pay in gold, but unlawful for anyone to receive gold. If good will-it not only made that contribution-but it had this act is stricken down as void, it will leave that identical an effect upon our own people, a very immediate and over­ legal situation. There will remain nobody who has any whelming effect upon the psychology of our own people. gold, nobody who can accept any gold, nobody who, if his Obligations were no longer regarded as obligations had pre­ demand for gold is complied with, can receive it without viously been. It shook the morale of our people. Men rec­ laying himself open to liability to be sent to the peniten­ ognized that the repudiation of a part of an obligation tiary. differs only in degree and not in kind from the repudia­ It should also be borne in mind that an adverse decision tion of the whole obligation. Men recognized that those cannot have the slightest effect upon obligations not payable who had repudiated one clause in their contracts had com­ in gold, and also that it cannot have the slightest direct mitted an offense against ethics, good morals, and good effect upon price indexes. The act striking down the faith, differing only in degree fr.om those who might say, gold clause in obligations neither raised nor did it lower "I owe you an honest debtt but I won't pay you a red penny." prices. It did not in any direct way affect price indexes. That consequence extended throughout our whole coun­ If it had any effect whatsoever on prices, it was a purely try. It touched and affected-alas, I fear, permanently­ psychological and indirect effect. I do not believe that any the lives of all our people. That is done. I cannot recall it. · economist, either by the facts of the situation or upon the I have no desire to recall it. Still less do I desire to criti­ basis of theory, can prove that it did have the slightest cize it. I merely state the facts, not my opinions. effect upon prices. Therefore, I think we are safe in saymg Of all outstanding obligations, probably the most impor­ that if the Supreme Court declares that act unconstitutional, tant are those carried in the insurance policies as they are that decision will not have the slightest direct effect either held by nearly all of our people throughout the entire coun­ to ·ra.t;e or lower prices. That it will have a psychological try. Those insurance policies aggregate something like effect, particularly in speculative fields, I do not doubt. $112,000,000,000. Thell' withdrawal value is about $16,000,· 1935 CONGRESSIONAL RECORD-HOUSE 601 000,000. That much is owing by the insurance companies to war. The world saw fit to unleash all the hates of mankind the women and children, a vast majority of whom have but and to send millions of the finest of all races into the little means and but little hope. That is the rock upon which trenches, with deadly instruments of death in their hands, they have built for sustenance when the breadwinner of the set upon taking each other's lives. The world tpok out of family had passed into the Great Beyond. The assets of the useful occupations, out of the production of things needful insurance companies are composed in the main of obliga­ for man, things which might have contributed to his wel­ tions carrying the gold clause. The striking down of the act fare and happiness-the world took out of those occupa­ of June 5 will very materially strengthen their position. It tions millions upon millions of the strongest, and bravest, will make an insurance policy worth more than it was before. and best, and set them instead to bringing about destruc­ It will add to the assurance and confidence of every man in tion-to destruction of the fruits of man's labor, to sub­ this whole country who has taken insurance for the protec­ tracting from the sum total of the wealth of mankind. tion of his wife and his children when he is gone. They were set not merely to taking each other's lives but The public obligations payable in gold amount to some­ to destroying both the material and the immaterial wealth thing like· twenty-five to thirty-five billion dollars. It is of all the nations. They blocked the channels of com­ very hard for me to gu~ss at that because of the great change merce, they pulled all the nations out of plumb and out of that has gone on through the refinancing of the Federal debt equilibrium, and now we are reaping the consequences. and various other things that have been done within. the last The fundamental cause of this depression was the war. year or so. Those who hold those obligations will be bene­ It roots. back into the war, and it has its manifestations in fited. Their position will be made more secure, and at the the erection of barriers of trade between the nations, and same time the situation of the States, counties, and munici­ in the damming up of the channels of commerce throughout palities, which owe something like $20,000,000,000 of these the world. It has had its effect in destroying mutual con­ obligations, will be no worse than it was before. They owe fidence and good will. The most serious factor confronting those debts. Their means of income is through the collection us now is the lack of confidence of nations, each in the of taxes. Their revenues are not payable in gold, but their other. They no longer trust each other; they no longer obligations are l:!O payable in gold. Taxes will be paid just as regard· the pledged word to each other; they no longer feel before. There is a chance that the cost of government will that they can rely upon the promise given, even by the be less~ It is certain that the credit of these public units will proudest of the nations. be enhanced by a decision holding as valid the geld clause in There can be no recovery in America until there has been their obligations. They will perhaps be able to borrow money recovery in some measure in all the world. The key to at a lower rate of interest than before. So that if this act is recovery in this country is to open up the markets of the unconstitutional, the probabilities are that the situation of world to the fruits of the labor of our people; to tear down our States, counties, and cities will be no worse than it is at international trade barriers and also to destroy the multi­ present. It may even be improved. tude of trade barriers which have been erected between So far as railroad and industrial securities are concerned, our own people and which prevent freedom of commerce undoubtedly striking down the act will have a harmful effect between our own people. This is the real cure. upon equities of all kinds. It will depreciate the value of It will be years before the nations will trust each other common and preferred stocks. It will enhance the value of again; it will be years before there is peace in Germany, their obligations which are payable in gold. in France, in China, and so on, and on, and on; but our In the speculative field, the effect of striking down this act contribution-the greatest contribution we in America can may be very considerable. It may cause a very great shock, make is to see to it that America's promises shall always be because those fields are very largely controlled by psychology. inviolate. [Applause.] Actually, and in reality, each of these classes of railroad If the nations of the world should be able to point to and industrial securities very largely off sets the other, and America and to a decision of our great Supreme Court, our there should be no important reaction in Wall Street if only bulwark of liberty and order and honest and brave thinking, realities could be counted upon, and psychology, fear, and which decision shall hold that the American Constitution speculation could be eliminated. But let me say in passing does not permit that a solemn obligation of our Government that I am not awfully much interested in what goes on in shall be repudiated, then we. will have made a contribution Wall Street, nor am I greatly concerned that some man has to world peace and to world stability second to none in the bought an equity on such and such terms, that he may be annals of government. farced to sell it for less than he has paid for it. It will not It is a long and a troubled road that we must follow back take away one hair's weight from the real worth of his secur­ to happiness and to prosperity. They can be gained by no ity. This assurance I should like to give him. empirical methods, by no temporary thwarting of economic So far as banks are concerned, they are probably not mak­ laws. God made these laws, and man cannot repeal them. ing many loans on these equities. If they are, they wilt be When he stands in their way, it merely means that he may afiected. At any rate, I say to them that it is the easiest thing delay, but that eventually he will be crushed. The free flow in the world to overestimate and magnify the evil conse­ of commerce throughout the world, based upon confidence quences which might come out of this decision of the Supreme and good will among the nations, is fundamental to world Court. peace and to world prosperity. It cannot be gained by our­ I think the business men of this country should get this in selves for ourselves alone. The first essential in gaining their minds. I invite them to analyze the situation and to it is a regard for the sanctity of the obligations of a: con­ think it out. Do not take some newspaper economist's word tract. Upon this principle, Mr. Chairman, I dare to stand. for it, or a statement made by someone who in the enthusiasm [Applause.] of legal argument dragged in something extraneous to the case. Let these men of business think for themselves. Let [Here the gavel fell.] them figure out for themselves how it will hurt them. I Mr. JACOBSEN. Mr. Chairman, I yield 10 minutes to the assure them if they keep their feet on the ground, if my gentleman from Texas CMr. DIES]. economic judgment is of any value, there will be very slight Mr. DIES. Mr. Chairman, I yield to no one in my respect harm to the business of this country. and admiration for the sincerity, the honesty, and the bril- . Of course, a decision that the act is void will work two liancy of the gentleman from Alabama. However, I do not ways. I can see benefits to come out of it. I can see agree with him in some of the statements he has made. The wherein any ill effect might be balanced off by very mate­ distinguished gentleman says that the Gold Revaluation Act rial good. A moment ago I pointed out that our action in constituted a repudiation of solemn obligations by the Gov­ repudiating our obligation had a world-wide impact. No ernment of the United States. man who understands world affairs can doubt for a minute J.\{r. HUDDLESTON. Will the gentleman yield? that this is true. This depression is not local, it is not Mr. DIES. I did not interrupt the gentleman when he was national; it is world-wide. The world is paying for the speaking. 602 CONGRESSIONAL RECORD-HOUSE JANUARY 17. Mr. HUDDLESTON. The gentleman is referring to the effective the revaluation by putting into circulation new cur­ wrong act. I did not refer to that act at all. rency based upan the increased valuation of our gold stock. Mr. DIES. Well, I refer to the statement the gentleman Mr. HUDDLESTON. ! ·did not say the Devaluation Act made about going off the gold standard. had that effect. I said this act of June 5 did not; it is an Mr. HUDDLESTON. No; I did not refer t.o that act. entirely different act from the Revaluation Act. Mr. DIES. To what act did the gentleman refer? Mr. DIES. They are all linked together. TQ revalue the Mr. HUDDLESTON. I referred to the act which declared gold dollar it was necessary to suspend specie redemption tnvalid the gold clause in contracts, that is all. and reform and modify gold clauses in contracts to make · Mr. DIES. The gentleman stated that that act was passed them payable in lawful currency. To make effective such without any necessity on the part of the Federal Govern­ modification it was necessary to revalue the dollar. ment and that at the time it was passed there was not any Mr. HUDDLESTON. No; they are not. apparent necessity for the Government to do it. Now, what Mr. DIES. The gentleman said that it had no effect on are the facts? . commodity prices in the United States. The facts are that England had gone off the gold standard, Mr. HUDDLESTON. I said that this act of June 5 did set up a stabilization fund, and was operating in the markets not. of the world by cheapening its own currency below the cur­ Mr. DIES. All right, this act. But the gentleman cannot rency of the United states in order that England might have consider these acts separately. Each is a necessary and an advantage in the world markets. The facts are that integral part of a coordinat.ed monetary policy to protect us France several years before had reduced the content of their from cheap currencies abroad and to protect our own people franc to one-fifth of its original weight and fineness in order from an abnormally appreciated dollar. The combined acts to obtain an advantage in the markets of the world. As a re­ were designed to restore the normal purchasing power of sult of the stabiliz.ation fund in England and its skillful op­ the dollar so that obligations can be discharged in honest eration, England was capturing from the United States the money. markets of the world. Not only was that true, but we have The facts are that the reduction in the contents of the the $100,000,000,noo of obligations in the United states pay­ gold dollar enabled foreign buyers to exchange 1 gold ounce able in gold when there were only approximately $12,000,000,- for $35 instead of $20. As a consequence of this our ex­ 000 of gold in the entire world. port trade was stimulated. Our export trade to China in­ We were driven to that act not because we deUberately creased some 80 percent, to Ecuador 101 percent, to Japan wanted to do so but in order to protect the United states 50 percent, and to Great ·Britain 37 percent. Not only did and our export trade from the deliberate and system11tic it result in stimulating our export trade by making it possible plan of Great Britain to cheapen her currency so that in for foreign buyers to purchase our products on a competitive the markets of the world she would have an advantage. basis with the products of countries like France and Eng­ In regard to the effect of the Supreme Court decision, the land, who had cheapened and depreciated their currency gentleman is correct when he says that even if the SUpreme but more important, it enabled us to hold our remaining Court rules against the Government, the obligations cannot export trade. Had it not been for that monetary po!.icy, our be discharged in gold. It is self-evident that with only export trade would have disappeared. It was manifestly $8,000,000,000 'Of gold in the United States we cannot dis­ impossible for the United States to maintain a gold stand­ charge $100,000,~00,000 of obligations with gold. As the ard and redeem these obligations in gold when the world gentleman correctly stated, our gold is now in the possession is against us, when other nations go off the gold standard of the Federal Government, and, of course, the Government and, as the gentleman says, refuse to redeem their obliga­ is not going to surrender the gold. The point the gentle­ tions in gold or to cooperate with us in the maintenance of man overlooks, if he will permit me to suggest it, is that in a gold standard. case, under the SUpreme Court decision, it becomes neces­ Now, is it a repudiation of a solemn obligation? One who sary for the debtors to discharge obligations payable in gold has an obligation today payable in gold gets currency that in the currency equivalent. of gold, the man who owes a has almost as much purchasing power as it did a year ago. thousand dollars payable in gold, not being able to deliver Is he being defrauded in any sense if he has an obligation a thousand dollars in gold, must deliver the currency equiva­ payable in gold for $1,000 and instead of getting $1,000 in lent of gold, which would be $35 for each ounce of gold gold, he gets $1,000 in American currency? Wherein has he owing under the contract. The consequence of that will be been robbed or defrauded? When you take your $1 ,000 you that the debtor classes in the United States will have to can still purchase almost as much of commodities as you discharge their obligations with $35 for every ounce of gold could prior to the action of the United States Congress. called for in the contract, whereas prior t.o revaluation they Mr. FORD of California. Mr. Chairman, will the gentle­ could have discharged the same obligations with $20 for man yield? each ounce of gold. Mr. DIES. I yield. What is the alternative? Of course, we ought t.o respect Mr. FORD of California. If this $1,000 were lent 5 years the ruling of the Supreme Court of our land, because none ago, you could purchase more commodities today than you of us want to destroy that fundamental branch of our Gov­ could then. ernment; but in case the ruling is adverse, the Government Mr. DIES. That is true, because of the fact that when can go back to the old content of 23 and some odd grains most of this money was loaned-and the gentleman, who is for ea.ch dollar. The restoration of the old content will be so much concerned about the fact that we might repudiate necessary unless some other alternative is found, and this some obligation, overlooks this fact-the dollar had a pur­ is the reason that gold revaluation is inseparably interwoven chasing power 50-percent less than now. Between 1921 and with the question of obligations payable in gold. What will 1929, about $200,000,000,00U were contracted when the dollar be the effect of that? Our export trade will rapidly dimin­ was cheap. The dollar had been deliberately made cheap ish, because other countries have adjusted their currency by credit inflation. So the creditor loaned a cheap 50-cent on the basis of our $35-an-ounce currency; and if we go dollar in terms of commodity prices. Then, today, regard­ . back, it will mean that foreign buyers, in order to purchase less of whether he can be paid in gold or in gold equivalent, our exportable surpluses, will only get 20 American dollars he gets back for each dollar he loaned, in terms of purchas­ for each ounce of gold. Since they will be able to acquire ing power, twice as much as he actually loaned. considerably more paper currency of other nations with an [Here the gavel fell.] ounce of gold, it will be to their internst to purchase the Mr. CANNON of Missouri. Mr. Chairman, I yield the 13roducts of those nations. It must naturally follow that the gentleman 5 additional minutes. United States will suffer the loss of this world trade. Mr. RANKIN. Mr. Chairman, will the gentleman yield? The gentleman stated that the Revaluation Act did not Mr. DIES. I yield to the gentleman from Mississippi. affect the internal price levels. To some extent the gentle­ Mr. RANKIN. The elements in the United States that are man is correct. One reason for this was our failure to make complaining most about this reduction of the gold content 1935 CONGRESSIONAL RECORD-HOUSE 603 of the dollar and the law to which the gentleman from Ala­ Mr. DIES. I simply want to say in reply to the gentleman bama [Mr. HUDDLESTON] refen-ed are the ones, as a rule, that there is no use for us to deceive ourselves about this. If who have their money invested in tax-exempt securities or the Supreme Court rules against the Government, we cannot those who have contracts that, as he states, are payable in redeem in gold equivalent. Congress should not compel the gold. Suppose the United States Government had discov­ debtor classes to do it on account of the condition of this ered an unlimited supply of gold and gold had become country. I will tell you what may have to be done. If we cheap. Then those same interests and individuals would have no other way around it, legally, we can tax the written have been demanding American dollars instead of gold. contracts payable in gold to the extent of 50 percent; and Mr. DIES. The gentleman's point is well taken. not only this we can issue United States notes to pay the But let me say this, in reference to the repudiation of a difference between the $20 and the $35. The gentleman promise to pay in gold. In the first place, impossibility of would deplore that action on the part of the Congress of ·performance is a defense to any contract, and at the timtt the United States, and therefore I say to the gentleman that we suspended specie redemption, raids were being made upon the creditor clas....c:es are more interested, or as vitally inter­ our gold stock. We witnessed the ridiculous situation of ested, in having the acts of the Government upheld as the debtor nations raiding the gold supply of the creditor nation. debtor classes, for if they demand the pound of :flesh when We could not have redeemed our currency and obligations people are unable to deliver it, then the Congress of the with gold because there was not enough gold in the world United States, in protection of the people, will be compelled to do this. We could not maintain a gold-exchange currency to resort to some method, either the issuance of United States because other nations refused to cooperate, and in fact notes and the taxing of such contracts, in order to save the forced us to follow their example in self-protection. On economic stability of the United States. If we have to restore account of the deliberate action of other commercial nations the old content of the dollar, we can accept silver at a pre­ in depreciating their CU1Tencies we were losing the markets mium in settlement of trade balance and protect our people of the world. from cheap foreign currencies. [Applause.] Not only is this true, but why was it right to write into a Mr. CANNON of Missouri. I yield 2 minutes, Mr. Chair­ contract that it should be payable in gold and not in the man, to the gentleman from Alabama [Mr. HUDDLESTONJ. currency of our land? Because the Supreme Court, after Mr. HUDDLESTON. Mr. Chairman, I am convinced that the war between the States-I believe in the Gresham case-­ one thing that we are suffering from in the House as well held that contracts payable in gold were enforceable in gold. as elsewhere is lack of information. [Laughter.] -The highest court in England has held on the same proposi- At the special session of Congress beginning March 4, tion that a contract payable in gold cannot be enforced, for 1933, we passed several acts which had relation to the use to do so is to deprive the sovereign power of its control over of gold as money. Among these are the act of March 9, currency. 1933, with resolution of ratification passed a few days later, The Constitution of the United States gives to Congress which had effect to withdraw all gold from circulation; the the power to coin money and to regulate the value of it, and act of May 12, 1933, which authorized the President to de­ if individuals, by contract, can specify that the payments value the gold dollar by reducing the gold content as much must be made in gold and not in currency, then that is para­ as 50 ·percent; and the act of June 5, 1933, which declared mount to saying that individuals have the right to restrict void all clauses in contracts requiring payment in gold. and limit the jurisdiction of Congress over currency and the The latter act I discussed a few minutes ago. It had noth­ value of it. If the Supreme Court rules contrary to the ing whatever to do with removing gold from circulation nor contention of the Government and holds that contracts pay­ with the devaluation of the gold dollar. able in gold must be paid in gold or in the currency equiva­ My remarks were addressed to the act of June 5, 1933, and lent of gold, it means an increase in debt of $69,000,000,000 if the Supreme Court is considering this act only. What I said we do not go back to the old content of the dollar or adopt has not the slightest bearing on the devaluation of gold or some other alternative. Not only that, but it means that upon foreign trade, or upon anything else the gentleman we cannot compete on the world markets. How can we sell from Texas [Mr. DIEsJ has talked about. our products with American dollars dear and the English What I ask is that our business men-I believe them pound cheap? How can we compete with France with the capable of thought-inform themselves and analyze what is franc depreciated to one-fifth of what it was before the war? in the act. and what the issue before the Court is, and try How can we retain the export market that the gentleman to do a little thinking of what will be the consequences if says we must have for our economic independence unless we the decision should be adverse to the act. protect our own citizenship against the deliberate" monetary All talk about foreign trade and so on has nothing to do tinkering" of Europe? with the subject. I invite thought on what I have said, to Mr. MAY. Mr. Chairman, will the gentleman yield? wit, that the effects of a decision of the Supreme Court ad­ Mr. DIES. I yield to the gentleman from Kentucky. verse to the act of June 5 may be very minor, and it might Mr. MAY. I have never been worried very much about be beneficial to the whole world. [Applause.] the decision of the Supreme Court of the United States in Mr. CANNON of Missouri. Has the gentleman from this matter for one reason. The American people can go Pennsylvania use for any more time? astray about a matter and they will run around in the Mr. DITTER. I have requests over here for approxi­ wilderness, but after a while come out straight; and when mately an hour, but I cannot use it immediately. the Court approaches this problem, it will probably approach Mr. CANNON of Missouri. Mr. Chairman, I yield 15 min­ it from the proposition that if the Congress delegated its utes to the gentleman from Oregon [Mr. PIERCE]. authority to coin money and regulate the value of it to the Mr. PIERCE. Mr. Chairman, I wish I were capable of President, this was without the bounds. discussing the question of the repeal of the gold clause t..~at Mr. DIES. That is true. has just been before the Committee. From my viewpoint, Mr. MAY. If they do not find that and get down to the without repeal, the debts· could never be paid. The con­ . major problem of whether or not the devaluation of the dol­ tracts for gold could never be carried out, and we were jus­ lar constitutes the impairment of the obligation of a contract tified in what we did in abrogating the gold clause. to pay in gold, they will probably take the position that the My object in asking for time was to reply to my friend making of these private contracts or these public contracts from Illinois [Mr. DIRKSEN] in. his eloquent and brilliant was done by the people who made them with full knowledge speech on the reciprocal-tariff act. of the constitutional provision that provides that Congress The Congress was justified in passing that act, and I think shall have power to coin ·money and regulate its value. his fears are groundless. mere the gavel fell.] He pictured the present condition of agriculture quite Mr. CANNON of Missouri. Mr. Chairman, I yield the gen­ accurately and then drew a dark picture of our future tleman 2 additional minutes. under operation of the act. He evidently believes in intense ; 604 CONGRESSIONAL RECORD-HOUSE JANUARY 17 nationalism. He would build a wall around this country and market for that wheat today. Under intense nationalism say to every foreign nation: "You cannot send anything in what will we do with the wheat? Have we got' to quit here that we can possibly produce." He would say to Japan, raising it? What are we going to do with our surplus cotton England, France, and to all the nations of the world: " Take if we cannot sell or trade some of it abroad? back from our harbors your cargoes of silk, of tin, rubber, Mr. CULKIN. Mr. Chafrman, will the gentleman yield tea, and coffee, because we are today a self-contained again? nation." I know that notion is extant in our country. It Mr. PIERCE. Yes. seems to me that nationalism is one of the things we should Mr. CULKIN. The gentleman speaks as if America were fear today. The feeling has been growing in this world for the chief off ender in respect to nationalism. Is it not true a century and a half. Perhaps it has grown more rapidly that European nations first became rampantly national? in the last century than ever before; and if it keeps on, it Mr. PIERCE. That is probably true. will keep raising these tariff walls between nations until • Mr. CULKIN. And since the World War, they have be­ trade, commerce, and traffic disappear. That is not going come more and more national. to lead to· world peace, but to a world of dissention, trouble, Mr. PIERCE. That is probably true. and ultimately to war. Mr. CULKIN. And we have, in fact, suffered from a weak The gentleman from Illinois [Mr. DIRKSEN] talks much nationalism. about industrial alcohol made from blackstrap. I call his Mr. PIERCE. The only way that we can break it down attention to the fact that his party was for 10 years in com­ at all is to give to the Executive, who can act quickly, the plete control, from 1920 to 1930, of all the branches of this power to say to a nation like Brazil-we want your coffee, and Government. Twice they revised the tariff upward; and if we will take your coffee if you will take so much wheat or there were such wrongs being committed by not prohibiting other products. I will go further than the present reciprocal­ the importation of blackstrap, why was its importation not tariff act, and bargain with those articles that are on the prohibited? He speaks eloquently for the distillers of Peoria free list. I would say to Japan, "You want to sell your silk, and that group which would like to prevent the coming in of but in order to do so you must take so much of our products." those articles which enter largely into the making of indus­ Mr. CULKIN. The gentleman knows that coffee is on the trial alcohol. For that reason he would then condemn the free list. entire reciprocal-tariff law. I would go over the party line, Mr. PIERCE. I am aware of that, but we have to sell to if the picture is half as black as he paints it, and raise the the outside world. tariff walls to keep out those articles that are evidently Mr. CULKIN. So that Brazil would have nothing to bar­ cutting off the supplies that should come from corn. Indus­ gain for in that connection. trial alcohol should be made from our own products if pos­ Mr. PIERCE. Brazil can use certain articles of our agri­ sible. For fear of the importation of black.strap molasses cultural products, the same as Cuba will under the reciprocal and starch, would he prevent the entire operation of the tariff agreement. reciprocal-tariff act? Mr. CULKIN. The gentleman has match factories in his Mr. CULKIN. Mr. Chairman, will the gentleman yield? district? Mr. PIERCE. Yes. . Mr. PIERCE. No. Mr. CULKIN. Is the gentleman in favor of letting Russian Mr. CULKIN. The gentleman realizes that lumber goes lumber in under one of these reciprocal-tariff arrangements into the manufacture of matches? without a tariff? I have in mind shingles and the products of Mr. PIERCE. I realize that, in some small part. the forest, articles of commerce from his own State. Mr. CULKIN. A great deal of it comes from the north­ Mr. PIERCE. I cannot believe for a minute that all of the west coast, from the gentleman's own State, and there is virtue, all of the attempt to do something for the farming pending now a ..t treaty with Sweden, if the gentleman is world rests on the Republican side of the Chamber. I am familiar with it, whereby the American match industry is willing to trust the President and his advisers. to be practically wiped out. Mr. CULKIN. If the gentleman will permit, I am won­ Mr. PIERCE. I cannot believe that. I do not think the dering whether he is as academic on lumber as he is on other President or his advisers would go that far. I think they phases of this tariff question. want to do right and find a market for the surplus, just as Mr. PIERCE. I do not know that I fully understand the much as the gentlemen on this ftoor. gentleman. Mr. CULKIN. That is what the match industry thinks, Mr. CULKIN. Would the gentleman be in favor of a trade and that is what the Tariff Commission found in March arrangement with Russia perm!tting lumber to come in 1934. Now it is proposed to cut down the tariff on matches under a tariff treaty, without any duty, in competition with and to give them an import quota which will destroy the the products of his own State? American industry. Does the gentleman favor that? Mr. PIERCE. No; my State is a neavY producer of Mr. PIERCE. I cannot believe that that is true. lumber. Mr. CULKIN. Assuming it is true, is the gentleman in Mr. CULKIN. So the gentleman would not be in favor of favor of that? that? Mr. PIERCE. It was not true in regard to Cuba, and we Mr. PIERCE. I would not want to throw down the bars heard the same things before that agreement was made. to let lumber in free if it competed with our lumber. I am Mr. CULKIN. Assuming my statement is true, is the gen­ not a free-trader. Free trade is as much an iJ.·idescent tleman in favor of that? dream as is nationalism. We have got to accept some of the Mr. PIERCE. No. I cannot believe the President would world's trade, or we have to regiment beyond any dream enter into such a trade agreement. The reciprocal-tariff act, that anybody has ever had in this country. If you go to for which I voted, was enacted for the sole purpose of trying intense nationalism, that means the tying up of the few ships to dispose of our surpluses in this country to nations which that are sailing the seas today, ·and that means that trade could take them, giving us certain things in exchange. is gone and that we have to live within ourselves. What are Mr. CULKIN. The gentleman knows what Will Roger~ we going to do with our vast surplus, if we cannot sell it or says about our diplomacy-that if we have another naval trade it for other goods? The only object of the reciprocal­ treaty, all we will come away with is one rowboat. tariff act was to try to find some place where we could dis­ Mr. PIERCE. I cannot believe that we can live within pose of this surplus. To illustrate from my own section, ourselves and be self-contained and keep our civilization. we have had to export two-thirds of all of the wheat we I think that the darkest day which can come to America. raise in the Pacific Northwest. will be the day we cut off all trade relations with the world. For 50 years that wheat went around the Horn in sailing We cannot say to foreign nations today, "You take our vessels and then through. the Panama Canal into northwest­ surplus and pay us in gold." They have not the gold. ern Europe, where it found a ready market. There is no They cannot buy. If we do not buy, we cannot sell. 1935 CONGRESSIONAL RECORD-HOUSE 605 Mr. CULKIN. Well, does the gentleman not take into con­ going off the gold standard? Have not some of them gone sideration the distinction in the standards of living between off that standard at previous times? our people and the Japanese, for instance? Because of our present difficulties, must we embark upon Mr. PIERCE. Certainly. such drastic and untried schemes, particularly as to the Mr. CULKIN. For example, we cannot compete with them issuance of printed money? in the match-making industry, where they pay women 8 cents Mr. McSWAIN. IVIr. Chairman, will the gentleman yield a day and men 17 cents a day, while we are paying our women for a question? 35 cents an hour and our men 50 cents an hour. We cannot Mr. GIFFORD. I yield. coll).pete with them in that field and maintain oui· standards Mr. McSWAIN. Does not the gentleman from Massachu­ of living, can we? setts remember, however, that the countries of continental Mr. PIERCE. I cannot understand that there will be any Europe prior to the World War were intensely strong in their attempt, when the final reports come in and the final treaties adherence to the gold standard, and that the principal argu­ are made, to break down our business in those lines or break ment made by those who opposed the campaign of Mr. Bryan down our standards of living. Our President and his advisers in 1896 was that it was necessary that America, if she was to want that to remain just as high as does the gentleman on become a great commercial nation, should be upon the gold this side of the aisle. There is no attempt on the part of the standard, the single gold standard, such as the other com­ President or those around him to turn over our markets to mercial nations were on at the time? the foreigners who have cheap standards of living; but the Mr. GIFFORD. I understand that, but that was not the object of the reciprocal tariff was simply to reduce these big argument of the previous speaker, the gentleman f ram Ala­ surpluses which break our home markets. The situation of bama," who stated that this Nation, above all nations, must the farmer is much better today than it was a year ago. The live true to her word and true to her obligations. The diffi­ Agricultural Adjustment Act is working for the benefit of the culty I have is in trying to reconcile the attitude of those who farmer. It is far from being right today, but it is certainly advocate such conflicting views. I want to know how these better than it was. .. views are to be brought into agreement. Mr. CULKIN. Someone to my left suggests that I query Mr. McSW AIN. I was seeking to answer the proposition of the gentleman again, if I may, as to what he thinks about history that prior to this time other nations had gone off the something that has already been referred to today, and that gold standard and the calamities that are predicted as about is the reduction in beet-sugar production in America. Beet to happen now did not happen then. As a matter of fact, sugar, of course, is not one of our surplus commodities. We prior to the World War other nations did not go off the gold only produce about one-quarter of the sugar which we con­ standard but adhered to it with the greatest rigidity. sume. I assume the gentleman's own State raises some Mr. GIFFORD. Referring to calamities, Mr. Chairman, sugar beets. there has been nothing but calamity to follow everything in Mr. PIERCE. We do not now produce any sugar beets. the way of these new departures we have seen undertaken in Mr. CULKIN. Some of the abutting States do, however. this country in the last few years. [Applause.] Under the present arrangement with Cuba the production [Here the gavel fell.] of beet sugar in continental America, and all sugar, is cur­ Mr. DITTER. Mr. Chairman, I yield myself 15 minutes. tailed, I understand, to about one-third, if I have the facts Mr. Chairman, I desire to pay my respects to the chairman correctly. That is a nonsurplus crop to which agriculture of the subcommittee and to the members of the subcommittee might turn itself. Does the gentleman think that we should for the very courteous and gracious way in which I, as the restrict our own farmers? only member_ from the other side of the aisle, was received The CHAIRMAN. The time of the gentleman from during the times of the hearing and the consideration of the Oregon [Mr. PIERCE] has expired. bill. To the Members on the right side of the aisle may I Mr. DITTER. Mr. Chairman, I yield 5 minutes to the say that in the hands of your capable chairman, it seems to gentleman from Massachusetts [Mr. GIFFORD]. me that the interests of the District of Columbia are cer­ Mr. GIFFORD. Mr. Chairman, I rose somewhat belatedly tainly safely committed. With some few items we are · not to ask the gentleman a question regarding his expression in accord. On those items I feel confident that probably that we had $100,000,000,000 of contracts payable in gold our differences are due more to individual interests than and had but $8,000,000,000 in the country. Some of us who to any purpose on the part of the chairman or his asso­ are struggling to learn from these speakers what the cure-all ciates to underestimate certain functions of the municipal is cannot help thinking that that has been the situation for government. many years back. For years there has been from fifty to I want to say just a word about the splendid appeal that one hundred billion dollars of such contracts while we had was made by the gentleman from Alabama [Mr. HUDDLESTON] perhaps only four billion in the Treasury. But what troubles in this House just a few moments ago. It seems rather a us is that many of these saine legislators who tell of this coincidence that his statement should immediately precede great danger likewise say that inasmuch as there is $8,000,- the appeal which I shall try to make. 000,000 in the Treasury, it is now safe to issue 10 times that No Member on the right side of the aisle could turn a deaf amount in printed money baclied by this gold, because a ear to the eloquent appeal made by the gentleman from reserve in the ratio of 1 to 10 would be sufficient in the light Alabama that those things which go to the moral fiber of a. of past experience. people, the fulfillment of obligations, the fulfillment of These two viewpoints do not seem to click, and I should solemn pledges, transcend in importance the matter of purely like to suggest that these obligations of eighty to one hundred material needs; and, from the standpoint of one of the billion dollars are generally long-term securities which would other party, may I add just my humble word of appreciation not be redeemable for years to come and hence the gold for the very forceful and splendid words, and the admonition would not be required at any particular date. If we should given by the gentleman from Alabama. issue that amount of money, its redemption might be de­ So far as the District of Columbia appropriation bill is con­ manded during a short period of panic. There are always cerned, in most respects I am thoroughly in accord with the runs on banks which have to be temporarily closed because members of the subcommittee on the right side of the aisle. they cannot meet their outstanding obligations. It might There is but one item for which I care to make an appeal be necessary even for the Treasury to stop the payment of today. That is the item of character education. As the bill gold for a time. But these two absolutely conflicting state­ was prepared and came to us for consideration, it provided ments made by the students of monetary problems are rather the sum of $87 ,000 for character education. As we considered confusing to us who are trying to learn. It is difficult to the bill, the majority members were persuaded and the com­ follow their lines of reasoning. I wanted a little explanation mittee report states, that in the judgment of the majority, ·as to why we seemed to get along pretty well for so long a the sum of $87,000 should be taken out of the bill, that the time, knowing that the same conditions existed. Has all experiment had not proved its worth, and that the endeavor this present chaos resulted from certain foreign nations that had been put forth by the Superintendent of Educatio~ 606 - CONGRESSIONAL RECORD-HOUSE JANUARY 17 for character education should no longer be carried on. At recent magazine article entitled "The Crisis in Character" the proper time it is my purpose to present an amendment in is the authority for the statement that the lack of character the hope that this $87 ,000 may again be made a part of the " has complicated our unhappy situation " and that the bill, in the hope that the character-education program in the decadence in character will continue to have far-reaching District of Columbia may be continued, in the hope that the effects after we have overcome the economic and political school system of the District of Columbia may provide a crisis through which we are passing and have restored to model for other school systems in the country to follow. our people a degree of material prosperity. The character-education experiment was introduced in I am not unmindful of the magnitude of the problems the public schools of Washington in September of 1934. It confronting. the present administration nor the demands came as a result of the investigation of crime and racketeer­ which have been made upon it. I realize that it is most ing conducted by a committee of the Senate and was en­ difficult for a democratic government to keep its expendi­ dorsed in the hope that the educational facilities of the city tures within reasonable bounds when spending is the crite .. might lend their efforts toward a solution of the crime rion of the popularity of the administration. It is to be problem ·and a proper appraisal of the value of character regretted, but we must admit that an extravagant adminis.. building in our community life. tration may purchase its popularity with the people by an It is proposed at this time to eliminate an appropriation ever-increasing volume of benefactions bestowed with polit­ for this purpose and to disrupt the organization which has ical favor and resulting in the ultimate prostitution of the been built up by the superintendent of schools in this com­ country and the destruction of self-reliance and courage. mendable program. No one will be bold enough to den.Y I deplore the fact that character education cannot be in­ that the development of character should be one of the cluded in this program of administration expenditures. I primary functions of our school system, but there are those appreciate keenly the fact that individuals, as well as Gov­ who believe that such a program should be relegated to a ernment agencies, must readjust themselves to the financial secondary place and depend for its efficiency upon hap­ conditions of the present day. I denounce wastefulness and hazard and unscientific methods. I cannot join with these. reckless prodigality, whether in public or in private life, but advocates of curtailment in character building. I believe we should come to a sense of relative values. Much The financial difficulties through which we are passing bas been said about the importance of balancing the Budget. have been permitted to have a disastrous effect upon the I am in accord with those who emphasize the need of main­ schools. A program of social suicide has been countenanced taining the national credit, but I am equally convinced that as municipal leaders have directed their efforts of ec{)nomy an economic recovery will be of little value unless those in­ to those educational institutions which should be depended terests which have to do with character building are safe­ upon for the development of leadership, and have paid scant guarded and developed. It will be futile to balance the Na­ attention to inefficiency and wastefulness in other branches tion's Budget and unbalance the Nation's life and spirit and of governmental service. The fallacy of the doctrine of re­ character. A financial deficit can be discharged, but a social trenchment in our public-school system becomes more evi­ and a character deficit cannot be paid by values in lands dent as one contemplates the imperative demands for lead­ and houses and material prosperity. I hold it as our first ership in this age of uncertainty. Dependability. stability, duty to give to our children the greatest possible advan­ and character are needed sorely today. Closed school­ tages for physical well-being, for intellectual discipline, and houses, overcrowded classrooms, depleted teaching staffs, the development of spiritual stability which can possibly be provide a fertile field for the sowing of iniquitous seeds of provided. Without these, prosperity will be barren. Dema­ un-Americanism and the cultivation of dangerous doctrines goguery with its limited vision and selfish purpose may and pernicious practices. The future well-being of Amer­ denounce the value of our schools and school systems, but ican life demands adequately trained, properly disciplined, a solemn duty rests upon us to bring the fallacies of their and soul-inspired young people today. denunciation to the light -0f day. It is a coincidence that today the ·President's message [Here the gavel fell.] stressed the importance of the same words that he em­ phasized in his opening message to this Congress, namely, Mr. DITTER. Mr. Chairman, I yield myself 4 additional minutes. the matter of social security. The President, in his opening message to the Congress. Mr. TERRY. Will the gentleman yield? reaffirmed his previous declaration that "among our objec­ Mr. DITTER. I yield to the gentleman from Kentucky. tives I place the security of the men, women, and children Mr. TERRY. The gentleman was speaking about the of the Nation first." Certainly this commendable program amendment i\l reference to cutting out the program pertain­ must include a recognition of the value of the contribution ing to character education in the Di.strict. Did they entirely which can be brought by the educational agencies of our eliminate the character-building program or just reduce it land. I cannot appreciate any note of harmony between somewhat? an avowed administration policy of emphasis upon social Mr. DITTER. When the program was originally provided security and an evident administration program of ignoring for last year, an allotment was made for a superintendent, the foundation upon which our social security must be counsellors, and the necessary clerical staff .to carry on the built-the character of our people. Social security does not experiment. We were advised at that time that they con­ depend solely upon material resources. Social security can­ templated a 3-year program; that success could not come not be obtained alone by statutes and administrative edicts. by simply inaugurating the program for a year and then Social security does not rest only upon the regulation of letting it run its own way; that there should be a natural business practices and the adjustment of controversial in­ building up year by y~ until the whole program of the dustrial issues. The security of a people springs from a schools of the city are brought within the character-building sense of responsibility for the welfare of others. experiment. It depends to a large degree .on the proper appraisal of Mr. TERRY. The idea of the committee, then, is after homely virtues-honesty, dependability, straightforward­ 1 year to eliminate entirely the character-building program, ness-in a word, on character. It depends on the endorse­ as I understand the matter? ment by our people of the value of rugged righteousness and Mr. DITTER. In fairness to the members of the com­ the denunciation of cunning craftiness in our everyday life. mittee who are advocating elimination of the item, may I It places a premium on the value of the fulfillment of cove­ say it is their thought that this character-building program nants and deplores the breach of solemn pledges~ It cannot may be carried on by the teaching staff presently provided, condone the doctrine of the excuse of expediency for the and that there need not be the emphasis and the provision repudiation of contractual obligations. The security of a for counsellors and clerical assistants to carry on the work people is primarily dependent upon a sense of confidence in t.o its complete consummation. With this opinion I do not the honesty of purpose of others and the integrity of the concur. To be successful it must be a systematic, coordi­ program of the Government. James Truslow Adams in a nat.ed program. 1935 CONGRESSIONAL RECORD-HOUSE 607 There is a difference in what we mean by economy. There Columbia owed the United States Government, if the Wash­ is an economy that realizes the spirit of wastefulness, which, ington people had to pay it back. unfortunately, has been only too prevalent in many govern­ While it was a great personal sacrifice for us to be away mental functions. I join with that company who denounce from home, Mr. CANNON, Mr. JACOBSEN, and myself spent such profligacy. But there is also an economy that counte­ most of the month of December, before this session met, nances destruction and ruin. With this school of thought I holding hearings on this appropriation bill. These hearings have nothing in common. I repeat that we must come to a embrace 871 printed pages. We had but one purpose, and realization of relative values, of putting first things first, that was to do full justice both to the District of Columbia and among the first things in our democracy is the value of and to the United States Government. the public-school system in character building. There is an This bill appropriates $39,308,404 for the next fiscal year old saying, "It is good to know; it is better to do; it is best for the District of Columbia, and in addition to that the to be." District has trust funds already given it of $1,430,000, and in Character education aims and has for its · purpose the addition· to that has a cash surplus of $2,450,000, yet all of molding of lives in the school system, the making of boys and the Washington newspapers are bemeaning Mr. CANNON and girls who will not depend on what their reputation may be myself, claiming that we have crippled the District by not but will depend upon what their character is. giving it enough money. I ask from both sides of the House, irrespective of party During the past 6 weeks the newspapers of Washington lines, when the time comes for the presentation of the have been carrying on a concerted campaign to try to force amendment, your support if you are interested in character Congress to give the District a larger Federal contribution to education as a worthy objective in the public-school systems civic expenses. As soon as we began the hearings, I reminded of this country. [Applause.] the chairman of the Board, Commissioner Hazen, that Pres­ [Here the gavel fell.] . ident Roosevelt's Budget fixed the Federal contribution at Mr. CANNON of Missouri. Mr. Chairman, I yield the $5,700,000 and asked him the following questions: gentleman from Texas [Mr. BLANTON] such time as he may Mr. BLANTON. The Budget has proposed that the Government desire. contribute this year $5,700,000. Mr. BLANTON. Mr. Chairman, I ask unanimous consent Commissioner HAZEN. Yes, sir. Mr. BLANTON. And you are asking for about $3,000,000 more? to revise and extend my remarks in the RECORD and to Commissioner HAZEN. About that, but the Budget did not seem insert certain excerpts I want to use in connection with the to agree with us. statement I desire to make. Mr. BLANTON. But you were asking for it? The CHAIRMAN. Is there objection to the request of Commissioner HAZEN. Yes, sir. Mr. BLANTON. But you are not expecting to get it? the gentleman from Texas? Commissioner HAZEN. We hope we will get it. There was no objection. Mr. BLANTON. You are carrying on a concerted campaign in the Mr. BLANTON. Mr. Chairman, I began my service in city now by way of meetings and banquets, speeches and news­ paper publicity, and so forth, to get that sum? this House of Representatives with the War Congress on Commissioner liAzEN. We ,hope to get it. April 2, 1917. My distinguished colleague from Missouri Mr. BLANTON. Is there any Washington citizen opposing it? [Mr. CANNON], chairman of this committee having this bill Commissioner RAzEN. I have not heard of it. in charge, was at that time an expert experienced parlia­ Mr. BLANTON. You do not expect any opposition from Wash­ ington citizens? mentarian and was then widely familiar with all affairs of Commissioner HAZEN. It is one thing to which there seems to be the District of Columbia. no opposition. He first began his services here as parliamentarian of Mr. BLANTON. Unless some representatives of the people here in Congress rise up in front of you, you will have no obstacles; this House and as such served under both Democratic and is that right? Republican administrations. He was the parliamentarian Commissioner HAZEN. Oh, I think we wm. I think this commit­ for the Democratic National Conventions at San Francisco, tee will probably oppose that. 1920; New York, 1924; Houston, 1928; and Chicago, 1932. Mr. BLANTON. Well, are not they representatives of the people? Commissioner HAZEN. Yes, sir; representatives of the whole Mr. CANNON of Missouri is the editor of two editions of the people. Manual and Digest of the House of Representatives, 1916 and Commissioner ALLEN. Mr. Blanton, we want to say also that we 1918; is the author of A Synopsis of the Procedure of the think we are representatives of the people. We do not want to be left out of that category. · House, 1919; of Procedure in the House of Representatives, Mr. BLANTON. Certainly; but the difference is, Mr. Commissioner, 1920; of Cannon's Procedure, 1928; and of two editions of the that you are representing 500,000 people of Washington and Chair­ Convention Parliamentary Manual. He is also the author of man CANNON and Mr. JACOBSEN and I are representing 120,000,000 Treatise on Parliamentary Law in Encyclopedia Britan­ people of the United States. Commissioner ALLEN. That is correct. nica, and is the editor and compiler of Precedents of the Mr. BLANTON. You are representing a part, and we are represent­ House of Representatives, authorized by act of Congress, ing the whole. There is the difference. We look at the matter and holds a doctor of laws degree. from the national viewpoint, a national scope, and you are looking at it from a circumscribed viewpoint within the scope of the city. Having had 23 years' familiarity with the affairs of Wash­ Commissioner ALLEN. That is correct. · ington and having been for years a close student of fiscal Mr. BLANTON. And, of course, our views are divergent. relations between the Government and the District of Co­ Commissioner ALLEN. That is correct. lumbia, there is no better posted man in the United States When debate began on this bill yesterday, I made a state­ than Mr. CANNON on the business, needs, and necessities of ment reciting the admissions made by the District Commis­ the District of Columbia. sioners. ·1 gave nothing but the facts, the truth of which is Besides being a member of other committees, I was assigned clearly shown by the testimony of said Commissioners. No to the Legislative Committee on the District of Columbia soon Member of this House made any attempt to refute any state­ after I reached Washington. I served on that committee a ment I made. No one could refute same. The RECORD sup­ number of years. I made a close detailed study of fiscal ported my statements. affairs, covering a period of more than 10 years. I per­ If Mr. CANNON and myself had given the District of sonally checked up every office, plant, and project in the Columbia all the Commissioners had asked for, and all District. For several years I was the ranking Democratic the Washington newspapers wanted, we would have had the member of said District of Columbia Committee. whole front, with our pictures in life size, on every news­ I had the benefit of having Hon. Ben Johnson, of Ken­ paper in Washington, and we would have been heralded as tucky, turn over to me all of his records, investigations, statesmen and the greatest men in Congress. But we did not historical data, and facts gathered by him during the years obey their mandates. And, as usual, we had to be subjected he served as chairman of that committee before the war to their gaffs, their ridicule, their misrepresentations, and Congress, and before his death he related to me many times their usual displeasure. They have let it be known that any in minute detail all of the many donations in large sums this Member who will not criticize the appropriation bill, and any Government has made to the people of Washington, and Congressman who will obey Washington newspapers, will how many hundreds of millions of dollars the District of have honorable mention, and can always get his picture 608 CONGRESSIONAL RECORD-HOUSE JANUARY 17 and a big write-up on the front page. But many people garding every fact I mentioned on the floor yesterday to show over the United States read the CONGRESSIONAL RECORD. you that you cannot get away from the facts. You cannot These readers of the RECORD check up on these Members wave away facts by a wave of the hand. · who, for a- little notoriety, advocate giving large sums of Mr. DITI'ER. Will not the gentleman yield for ·a ques­ public money out of the Federal Treasury to pay part of tion? the expenses of Washington people, and these readers of the Mr. BLANTON. Just a minute. I do not want to take RECORD calmly pass on the question whether Washington too much time. I want to show up some of these newspaper people are well cared for and whether it was necessary for misstatements. them to pay so much of Washington's expenses. For instance, the Herald this morning in attempting to So the older Members here have learned that there is no quote statements made by our distinguished and able chair­ reason or excuse whatever for making the people in the ·man, the gentleman from Missouri [Mr. CANNON], and in States pay the expenses of Washington people, and that attempting to quote me, -in great big box-car letters, states their constituents back home call them to account when the following: they get too generous with the people's money, and they Starve needy out of city, Blanton's District of Columbia budget have quit making speeches for Washington newspapers. plan. ' I wondered yesterday just who would take the floor to make Representative CANNON of Missouri also suggested the relief recipients be sent back to farm-they do not belong here 1n . the" Washington" speech. I knew it would be someone who Washington. had not been here many terms. To my great surprise it was my good friend from Illinois [Mr. DIRKSEN]. He was Now, all of that quotation is absolutely false. Both Mr. elected to Congress in November 1932, and had served one CA.i.'ffi'ON and myself were referring only to transients in Wash­ term, and I thought that would have given him time to be ington. There are over 10,000 Negro transients in Washing­ better informed. He is a splendid, fine, active Member of ton drawing relief, and we advised that they should go back the House, and personally I like him immensely. But he to their homes and go to work. has not been here long enough to learn much about District THE OFFICIAL PRINTED HEARINGS affairs. He preluded his remarks with this statement: Now, I am going to quote a few· excerpts from the official Mr. DIRKSEN. Mr. Chairman, if there were only more new Mem­ printed hearings which will conclusively prove every fact bers in the Chamber at this time, I should like to disabuse their stated by me in my speech yesterday: minds of some of the things that were stated here a little whlle ago by the distinguished gentleman and philosopher from the Mr. BLANTON. Mr. Chairman, before Major Donovan makes his sagebrush country of Texas. I shall never forget as a Member statement, I desire to ask Commissioner Hazen some questions, of the Seventy-third Congress, listening with deep interest to as he ls the President of the Board of Commissioners. the statement that was made at that time about how we frittered So that everyone may understand the matter under considern.­ away the money of the people of this country and lavished it upon tion, this bill upon which we are now holding hearings is ca.l!ed the people of the District of Columbia. the " 1936 bill." That is the appropriation bill for the fiscal year from July 1, 1935, to July 1, 1936. Why did he say I was from the "sagebrush country"? Commissioner HA.zEN. Yes, sir. There is not a sagebrush in my entire district. I am not Mr. BL.ANTON. The bill upon which we held hearings early th~s year and for which we made appropriations, known as the "1935 from the sagebrush country of Texas. He did not deny a bill ", is for the current year that ends June 30, 1935. single statement I made in my speech. He could not deny Commissioner HAzEN. That is right. any statement, because every statement I made was proved Mr. BL.ANTON. In the general statement that you made on :March by 7, 1934, before this subcommittee, I quote from your statement by admissions made the Commissioners in the printed on page 5 of the hearings. You call attention to the fact that the hearings. He tried to get around my speech and the indis­ tax rate for the present fiscal year had been reduced to $1.50, putable facts stated by me and quoted from the hearings by and then you use this language: a mere wave of his hand. He said he would not attempt to "This reduction represents a saving to taxpayers in the fiscal year 1934 of $2,445,000." disabuse the minds of new Members at that time, but That is a fact, is it not? promised to do so at some other time. Why did he pick new Commissioner HAZEN. I assume so. Members to disabuse their minds? Why did not he disabuse Mr. DONOVAN. That is about right. Mr. BLANTON. Then you went on to say: the minds of all Members? Because all the old Members Moreover, in the fiscal year 1934 the assessed valuation of real knew I stated facts. estate has been reduced by $80,000,000, a saving to property own­ True to form, the Washington newspapers gave big head­ ers of $1,200,000. lines to Mr. DIRKSEN. He immediately became Washington's That is right? Commissioner HAZEN. Yes, sir. hero. I quote the following from the Washington Herald: Mr. BLANTON. By a reduction in the assessed valuations of real Caustic criticism of District residents by Representative BLAN­ estate to the extent of $80,000.000, you meant that you distributed TON, of Texas, on the floor of the House yesterday after the local that over the general assessments? budget was reported, aroused Representative DIRKSEN, of Illinois, Commissioner HAzEN. Yes, sir. to a vigorous defense of Washingtonians. Mr. BLANTON. But everyone was presumed to have received a Representative DIRKSEN said his service on the District Commit­ decrease? tee had convinced him that most of Mr. BLANToN's criticism was Commissioner liAzEN. It is supposed to be leveled over the en­ undeserved by the people of Washington. tire District. Mr. BLANTON. That ls right; it was leveled over the entire Dis­ Not in any particular was it shown that any fact was mis­ trict. stated, or that I had made any error in quoting from the Mr. DONOVAN. They all got the benefit of the decrease in the hearings, or that I had made any criticism that was unde­ tax rate. Mr. BLANTON. Then you further state: "It is also contemplated served. There was just the lawyer's" general denial." that a further reduction in the assessed value of real estate of Now I quote from the Washington Post. It, too. ran true approximately $50,000,000 will be made in 1935." to form: Did you make that further reduction? Commissioner HAZEN. There was further reduction. Almost the entire afternoon session of the House yesterday was Mr. BLANTON. And you did make another reduction, approxi­ occupied with general debate, during which Representative BLAN­ mately $50,000,000, in assessed values, as noted by the assessor, TON, ranking member of t~e subcommittee, harangued regarding Mr. Richards, of 10 percent in the assessed valuations? the advantages of living in Washington and the "propaganda" of Mr. RICHARDS. Yes, sir. the local newspapers. Mr. BLANTON. And that was general all over the District? Representative DIRKSEN (Republican), of Illinois, a member of Mr. RICHARDS. Yes, sir. the House District Committee, took BLANTON to task for some of his Mr. BLANTON. So that property owners generally got the benefit criticisms. of that additional $50,000,000 reduction? Because I gave facts, the Post said I "harangued." Just Commissioner HAZEN. That is quite right. Mr. BL.ANTON. Then this year and last year you have given the in what way did Mr. DIRKSEN "take me to task"? Not a property owners in the District a reduction in the assessed values denial of any fact stated by me did he make. of real estate of $130,000,000, or 15 percent, have you not? Mr. DITTER. Mr. Chairman, will the gentleman yield? Commissioner HAZE.N. Approximately; yes, sir. in Mr. BLANTON. Then you also say: Mr. BLANTQN. In just a minute. I am going to put "The Commissioners also invite attention to the recommenda­ my remarks a quotation from the hearings, and these are tion under the chapter for the water service for a 25-percent admissions from the District Commissioners themselves, re- reduction in water rates for 1935, and an increase 1n the metered 1935 CONGRESSIONAL RECORD-HOUSE 609 allowance now 7,500 cubic feet to 10,000 cubic feet. This means a Mr. BLANTON. I thought so, and I Wa.<3 trying to get their presen• saving to water users of about $600,000." attitude on it. That wa.s provided? Mr. CANNON. Evidently there has been a change in the attitude Commissioner HAzEN. Yes, sir. of the Board of Commissioners. Mr. BLANTON. So that the property owners of the District got a INTANGIBLE TAX saving of $600,000 through a decrease in water charges? Mr. BLANTON. The tax on intangibles in the District ts one-half Commissioner HAzEN. Yes, sir. Mr. BLANTON. In addition to· that $600,000 decrease in water of 1 percent. That is a fact? charges, they also got the benefit of the increased metered allow­ Commissioner HAZEN. I believe so. ance of 2,500 cubic feet of water? Mr. BLANTON. And it is a fact that up to this date the amount that 1s collected on intangibles is almost infinitesimal, is it not? Commissioner IIAzEN. Yes, sir. Mr. BLANTON. Without extra charge? Mr. DONOVAN. Oh, no; $2,000,000 a year, Mr. BLANTON. Mr. BLANTON. Yes; when you consider the hundreds of millions Commissioner IIAzEN, Yes, sir. Mr. BLANTON. So that they got a double benefit in the matter of of dollars that are stored away in these lock boxes in the safe­ deposit vaults 1n Washington-if you could get at them-you the water charges? would" find hundreds of millions of dollars of intangibles that Commissioner HAzEN. Yes. sir. could be taxed. Do you not think so, Major? Mr. BLANTON. Then you further say: Mr. DoNOVAN. Mr. Chairman, I am perfectly w1lling to say that, " In the fiscal year 1934 Congress allowed a discount of 10 percent in my opinion, we ought to get a great deal more than we do from of the amount of any bill for water charges paid within 15 days the present tax on intangibles. after the date of the rendition thereof. It is estimated that this Mr. BLANTON. Do you not think that there are hundreds of mil­ will mean a saving of about $100,000 to water users." lions of dollars stored away in lock boxes here? That was a saving of $100,000 additional, approximately? - Mr. DONOVAN. I would not say how much. But I believe we HAzEN. Commissioner Yes, sir. ought to get more money than $2,000,000 a year. Mr. BLANTON. To water users here in Washington? Mr. BLANTON. Certainly. Commissioner HAzEN. Yes, sir. Mr. CANNON. You mean at that rate it should be more than Mr. BLANTON. It ts a fact, Mr. Commissioner, that the tax rate $2,000,000? this year, the fiscal year 1935, is only $1.50 per 100 on real estate Mr. BLANTON. Has there ever been, so far as you know, since and only $1.50 per 100 on personal property, is it not? you have been connected with the District government, a prose­ Commissioner IIAzEN. Yes. sir. Mr. BLANTON. There ls no contemplation in the minds of the cution against anyone for making a false return on intangibles? Commissioners to increase that tax for next year, 1936? You do Commissioner HAzEN. Not that I recall; no cr1minal action. not contemplate increasing it? INTANGIBLES REACHED WHEN RICH MEN DIB Commissioner HAzEN. We do not contemplate increasing it. Mr. Chairman, if my colleagues will look on page 11 of Mr. BLANTON. You have stated you did not contemplate that, have you not? the printed hearings, they will see that between January Commissioner HAZEN. Yes, sir. and November 1934 there were 76 wills probated in the Mr. BLANTON. So far as you know now, your tax rate for next District of Columbia, where each one of these 76 estates year, 1936, will be $1.50 per 100? Commissioner HAzEN. It will, because we can meet the items in held a large amount of intangible assets, which there­ this bill with a $1.50 tax. tofore had been unta~ed. Their names and amounts SURPLUS CARRIED OVER FROM FISCAL YEAR 1934 AND ESTIMATED SURPLUS are shown. One estate owned $82,000, another $115,000, FOR FlSCAL YEAR 1935 another $105,000, another $96,000, another $335,000, and Mr. BLANTON. With that U.50 tax rate, you stated in your pre­ another $1,064,400 in intangible assets, which before their liminary general statement that you carried over from the last fiscal year to the present fiscal year a surplus of $4,600,000? death had been locked up in tin boxes in bank vaults. Commissioner HAZEN. That is right. After a man dies the title to his securities listed in his name Mr. BLANTON. And you say that you will inherit next July 1 a cannot be passed to his heirs until they go through the surplus of-- · probate court. Hence after death these intangibles come Commissioner HAZEN. $2,450,000. Mr. BLANTON. A $2,450,000 cash surplus, to help you on expenses. out of lockboxes and reach the fight of day. Commissioner HAzEN. That is what our auditor says. I now quote further from the official printed hearings:" Mr. BLANTON. That is what you say? GASOLINE TAX Commissioner HAz:EN. Yes. Mr. BLANTON. You have also, !or this coming ft.seal year, a trust Mr. BLANTON. In the District of Columbia there ts a gasoline fund, as you said in your general statement, of $1,430,000? tax of 2 cents a gallon? Commissioner RAzEN. Yes, sir. Commissioner IIAzEN. Yes, sir. Mr. BLANTON. That 1s a fund to which you have access, which Mr. BLANTON. That is in addition to the 1 cent Federal tax? you get out of the Treasury, regardless of what Congress does in Commissioner HAzEN. Yes, sir. this bill, is it not? Mr. BLANTON. In many States their State tax, in addition to their Commissioner HAzEN. Yes, sir. Federal tax, ranges from 5 cents to 9 cents a gallon. For instance. Mr. BLANTON. Because Congress in an appropriation blll cannot in Tennessee it is 7 cents. In Virginia, what 1s it? repeal that. Commissioner HAzEN. Five cents. Commissioner RAzEN. That is right. Mr. BL.ANTON. In Maryland it is now 4 cents? Mr. BLANTON. It takes a legislative act to repeal that? Commissioner HAz:EN. Yes, sir. Commissioner HAzEN. That is right. Mr. BLANTON. The Mapes bill to provide for an extra tax on gaso­ Mr. BLANTON. So you have got that much cash to start on, have lhl:e was passed in the House of Representatives unanimously, there bemg not a vote against tt, on December 17, 1931. The bill was )'OU not? Commissioner HAzEN. Yes. H. R 5823. It was pigeonholed a.nd died 1n the Senate. Mr. BLANToN. You have no income tax for the District of Have you any objection to that bill, or a similar bill, being passed Columbia? by the present Congress? Commissioner IIAzEN. That 1s true. Commissioner HAzEN. No, sir; I am speaking now personally, of Mr. BLANTON. Such as other cities and States have? course. Commissioner HAzEN. No. LICENSE-TAG TAX Mr. BLANTON. And you have no inheritance tax here in the Mr. BLANTON. In the Dtstrtct of Columbia there 1s a license-tag District of Columbia? tax that people pay in order to get their license plates each year. Commissioner HAzEN. No, sir. That amounts to only $1 per car. Mr. BLA.NTON. In the Congress before last there were introduced Commissioner HAZEN. Yes, sir. and passed by the House of Representatives unanimously, but were Mr. BLANTON. That would be $1 per car for an $8,000 Rolls-Royce pigeonholed and died 1n the Senate, what are known a,s the limousine as well as a dollar per car far a Ford or a Chevrolet? "Mapes bills", following exhaustive hearings by a regular select Commissioner HAzEN. Yes, sir. committee known as the "Mapes committee." One of said bills Mr. BLANTON. They are all the same? so passed unanimously by the House provided for an income tax Commissioner HAZEN. Yes, sir. for the District. That is so, is it not? Mr. BLANTON. In some States the fee on a. Rolls-Royce would be Commissioner RAzEN. Yes, sir. $40. In the District it would be a dollar. That ts a fact, is it not? Mr. BLANTON. Are you recommending any income tax for the Commissioner HA.zEN. For the tag. District? Mr. BLANTON. In the Mapes bill, introduced in and passed by the Commissioner HAzEN. We have not in this Congress; no, sir. House at Representatives by unanimous vote on December 17, Mr. BLANTON. Do you intend to recommend one? 1931, but which died in the Senate, there was a provision to Commissioner HAzEN. I cannot speak for the Board, Mr. Blanton. increase the cost o! license tags upon automobiles, and to provide Mr. BLANTON. Do you favor an inheritance tax for the District? a comparable tax on trucks that do an interstate business through Commissioner HAzEN. Mr. Blanton, I have no.t given it sufficient the District from New York to Texas. Is there any objection to study. that bill betng passed by Congress? Mr. BLANTON. You are not ready to speak on that? Commissioner HA.zE.N. I think there ought to be a larger tax on Commissioner HA.zEN. No. automobiles. Mr. CANNON. In previous hearings, the Board of Commissioners Mr. BLANTON. But both Fords and Rolls-Royces each pay jus1J have gone on record, have they not, as favoring the levying o1 an $1 for license-number plates here in Washington. In the calendar income tax and an inheritance tax for the District? year 1933, in Maryland. the registration fee on a Chevrolet or a LXXIX--39 610 CONGRESSIONAL RECORD-HOUSE JANUARY 17 ;Ford was $8.64. That ls right over across the line, 4 miles from Connecticut Avenue that is known as the " million dollar " bridge the Capitol. Compare that with $1 charged Rolls-Royces in the was built that way, the United States paying half of its cost. District. You have no objection to legislation being passed to Commissioner HAZEN. It is the Taft Bridge now. increase that tax to make it a fair tax, have you? Mr. BLANTON. For many years it was called the "million dollar Commissioner HAZEN. Well, we have thought of a weight tax. bridge ", because it cost a million dollars. We will discuss that matter later. Commissioner HAZEN. Yes, sir. Mr. BLANTON. Have you any recommendations prepared to sub­ Mr. BLANTON. Also a number of other important bridges and mit to Congress regarding a tax on these trucks that wear out many fine school buildings having been built under that same your streets here? arrangement. Then after that there was a period when the amount Commissioner HAZEN. We will have. that the Government paid was reduced to a basis of 60-40; is that Mr. BLANTON. Have you any at the present time? right? Commissioner HAzEN. Not at this time. Commissioner HAZEN. Yes, sir. WATER TAX Mr. BLANTON. The Government then paid 40 percent and the District 60 percent? Mr. BLANTON. In the District of Columbia the average water tax Commissioner HAZEN. Yes, sir. per family is now approximately what? Mr. DONOVAN. It is about $8.75. "BENEFITS TO CITY FROM NATIONAL EXPENDITURES Mr. BLANTON. Was not that the tax before Congress reduced 1t? Mr. BLANTON. Mr. Commissioner, within the last 20 years the Gov­ Mr. DONOVAN. It was that before Congress reduced 1t. ernment of the United States has spent for permanent improve­ Mr. BLANTON. But Congress reduced it? ments in the way of beautiful public buildings in Washington Mr. DONOVAN. You mean the 25-percent reduction? $200,000,000. That is a great asset to Washington, is it not? Mr. BLANTON. Yes . . Commissioner HAzEN. It certainly is. Mr. DONOVAN. If you take the 25 percent off-- Mr. BLANTON. And the press of Washington last week stated that Mr. BLANTON. I am talking about what they now actually pay during this month there were to be 19 big national conventions per family per year for water. held in Washington. That is a tremendous help to Washington, is Mr. DONOVAN. With the 25 percent off and the increase in the it not? metered allowance, it is probably around-- Com.missioner HAZEN. To the business of Washington, yes. Mr. BLANTON. About $6.75 per year per family for water? Mr. BLANTON. Those people spend their money when they come Mr. DONOVAN. That or a little under. here for hotels, and for buying things at the stores, and so forth. Mr. BLANTON. Per year, per family for splendid water. Mr. Com­ Commissioner HAZEN. It is a good thing for business, but a bad missioner, is not that a remarkably low charge for water? thing for the police department. Commissioner HAZEN. I do not know. · Mr. BLANTON. But it is a wonderful thing for the business of Mr. BLANTON. Allowing 10,000 cubic feet for a fl.at rate like that Washington, 1s it not? per family per year for $6.75 or approximately 50 cents per month Commissioner HAZEN. Yes, sir. for water? Mr. BLANTON. It is something that the chambers of commerce Commissioner HAZEN. Of course, it covers all operating expenses all over the United States in the big cities pay hundreds of thou­ and allows for extensions. How it compares with the charge in sands of dollars for every year, is it not? other cities, I do not know. Commissioner HAzEN. Yes, sir. Mr. BLANTON. That is a special privilege that Washington people Mr. BLANTON. Now, is there a building in Washington that 1s enjoy here that the citizens of many other cities do not enjoy. You owned by this Government that is not an asset to Washington? realize that that is a low rate? Can you tell me of one that is not? Colonel SULTAN. It is low; yes. Commissioner HAzEN. I would say that some of these buildings Mr. BLANTON. The colonel knows about that. down in the Mall are not good assets. Colonel SULTAN. For filtered water, it is very low. Mr. BLANTON. I am talking about the permanent buildlngs. Commissioner HAzEN. I am told it is one of the lowest. Are they assets to Washington? Mr. BLANTON. The water charges in most of our cities are much Commissioner HAZEN. I would think so. higher. In the summertime some people in other cities pay as Mr. BLANTON. You would admit that they are assets to Wash­ much as $25 a month for water to keep their lawns and trees alive, ington? and then they cannot get all of the water they need. Commissioner HAzEN. Yes. Commissioner HAzEN. It doe&, however, take care of all expenses Mr. BLANTON. The people all over the United States come here and upkeep--the present rate. to see these big public buildings, do they not? Mr. BLANTON. In Maryland, just across the line, a few miles from Commissioner HAZEN. Yes, sir. the Capitol, the water charge for a family of three is $14, just Mr. BLANTON. This new $10,000,000 Supreme Court Building 1s double what it is in Washington. one of the beauty sights of Washington, and this $14,000,000 Me­ CONNECTIONS WITH SEWER SYSTEM morial Bridge that the Government built here is a wonderful asset to Washington, is it not? In the District of Columbia a man who built a house 25 years ago Commissioner liAzEN. Yes, sir. and then paid for having his house connected with the sewer system Mr. BLANTON. The people of Washington did not pay anything of the District has not in the last 25 years had to pay a single addi­ for it, did they? tional monthly service charge for sewers, has he? Commissioner HAZEN. I think not. Commissioner HAZEN. No. Mr. DONOVAN. Except the approaches. Mr. BLANTON. And he w11l not have to pay any in the future, Mr. BLANTON. I am talking about the $U,OOO,OOO that we spent will he? out of the Treasury for the Memorial Bridge. That was paid for Commissioner HAZEN. No, sir. out of the Public Treasury, was it not? Mr. BLANTON. After he once connects with the sewer, there 1s no Commissioner HAZEN. Yes. service charge at all thereafter? Mr. BLANTON. Every person in Washington uses that bridge, do Commissioner HAzEN. I think not. they not? Mr. BLANTON. This is a special privilege that Washington people Commissioner HAZEN. I suspect that most of them do.· enjoy that is not enjoyed by citizens of other communities-by Mr. BLANToN:. And all of the splendid parks, and there are 1,200 citizens of many other communities, is it not? of them here in Washington, little and big, are used by the people Commissioner HAZEN. After the property owner installs his con- and enjoyed by them, are they not? nection with the sewer system, there is no charge from then on. Commissioner liAzEN. Yes, sir. Mr. BLANTON. I say that 1s a privilege that they enjoy here? Mr. BLANTON. And it is a wonderful asset to the people of Commissioner HAZEN. Surely it is a privilege. Washington. Mr. BLANTON. For instance, in Abilene, Tex., I am paying $3 a Then, we have one of the greatest Zoos in the United States here month for such service. in Washington, have we not? Commissioner HAzEN. For sewer? Commissioner HAZEN. Yes, sir. Mr. BLANTON. For sewer service, paid every month. Mr. BLANTON. And the 87,000 school children of Washington Commissioner HAzEN. Is that so? attend lt regularly, do they not? Mr. BLANTON. $3 every month, as everyone is required to pay so Commissioner HAZEN. They attend it. I do not know how much for every connection in the house, for every lavatory, every regularly. toilet, every spigot that you have in your house you have got to Mr. BLANTON. But they do attend it? pay a certain charge. Such a system exists in many cities. Commissioner HAzEN. Yes. Now, paying no monthly service charge is a privilege that the Mr. BLANTON. Swarms of them? Washington people enjoy, is it not? Commissioner HAzEN. Yes. Commissioner HAzEN. Surely it is. Mr. BLANTON. Mr. Commissioner, you have been a. public servant FEDERAL CONTRIBUTIONS TO FEDERAL EXPENSES OF DISTRICT OF COLUMBIA for a long time, and you are intimately acquainted with every Mr. BLANTON. Now, with regard to paving in the years during detail of Washington business and history. On the whole, can you which there was so much paving done in the District. During cite the people of any city of the United States who have better those years there was a system whereby the Federal Government privileges, who are better cared for, than those in the city of paid 50 percent of all the expenses of the city of Washington? Washington? . Commissioner HAzEN. Yes, sir. Commissioner HAZEN. I think that it is the greatest city in the Mr. BLANTON. And streets were paved, fine schools were built, United States. playgrounds were acquired, and bridges were built, the court build­ Mr. BLANTON. And Washington people are better cared for, are ings, hospitals, asylums, and Jail were constructed, and general im­ least taxed, and have greater privileges than any other people in provements were made on that same basis. Our water system and the United States? sewer system were thus acquired and perfected. This bridge out on Commissioner HA.zEN. I believe they do. 1935 CONGRESSIONAL RECORD-HOUSE 611

Mr. BLANTON (to Mr. CANNoN). Do you mind, Mr. Chairman, the Government about twice what it is worth. I quote the our giving tha.t out to the Washington press to offset the vigorous hearings from page 47 to show this: compalgn it is now making to force Congress to give Washington people s~veral million dollars more in a Federal contribution. Mr. CANNON. There is one piece of property that in September Mr. CANNON. I see no reason why there should be any objection. 1919 sold for $4,500 but for which the jury compelled the Govern­ Mr. BLANTON. That is all; thank you. ment to award $11,500. Here is one piece of property, lot no. 40, which 1n June 1919 My colleagues will note that Commissioner Hazen, president sold for $12,000, and for which the Government had to pay of the Board of Commissioners for the District of Columbia, $25,000. admitted that the people of Washington are better cared for, Here is another piece of property, lot no. 32, an inside lot, which on July 19, 1922, sold for $3,800, and for which the Government are least taxed, and have greater privileges than any other was required to pay $8,250. people in the United States. Here are two lots which in November 1923 sold for $16,500, which I will assert without fear of contradiction that the city cost the Government, under the award of the jury, $37,500; and officials and employees of the District of Columbia, a city another lot which in August 1922 sold for $11,000, but for which the Government was charged $28,500. of 500,000 people, receive larger salaries than do the offi­ Here is another lot, lot no. 832, which 1n January 1919 sold for cials of any other city of comparable size in the whole world. $3,500, but for which the jury awarded $12,500. And regularly each month their salaries are paid in spot I recall the first jury that was empaneled for the fixing of the value of the site for the Jefferson Junior High School, and it fixed cash, and they have never had to wait for payment, or dis­ the value of the property at $105,000. A second Jury increased that count their pay to get the cash. It is always forthcoming to $294,000. That must have been another case where the jury promptly on the date of payment. And it is promptly spent, was subject to other intluence than the merits of the case. so that all business men of Washington get the benefit of it. Mr. RICHARDS. Mr. Chairman, in the first award that was made on that property, I t.estified. I do not believe any property 1n And the 100,000 Government employees here in Washing­ that locality is worth over $1 a foot. Three men got on the ton regular spend most of their cash earnings here each stand and testified that it was worth $5 a foot. month. The business men of Washington get the benefit LOCAL EMPLOYMENT SERVICE IN WASHINGTON of their salaries. They get most of the salaries of Congress­ Mr. BLANTON. Where did you come from? men. They get most of the salaries of United States Miss MERRIT!'. My legal residence happens to be New York, be­ cause I was there- Senators. Mr. BLANTON. That is where practically all of Miss Perkins' If you will look on pages 104 to 110 of the printed hearings, employees have come from, all the way down the line. you will see the salaries paid officials of the District of Colum­ Miss MERRITT. I was from Chicago just before that, but-­ Mr. BLANTON. But your legal residence is New York? bia, and when I mention same I mean basic salaries. The Miss MERRI'IT. I just by accident have a legal residence there. Commissioners receive $9,000 per annum and are furnished Mr. BLANTON. When did Miss Perkins notify you to come? an automobile. The city secretary gets $5,600. The purchas­ Miss MERRITT. I was appointed on the 17th of September this ing officer gets $5,400. The inspector of buildings gets $5,800. year. Mr. BLANTON. What salary do you draw? The tax assessor gets $7,500. The tax collector gets $6,000. Miss MERRITT. $3,000. The deputy assessor gets $5,600. There are 7 assistant Mr. BLANTON. Who is over you? assessors who receive $4,800 each. The city auditor gets Miss MERRITT. Directly, Mr. Young, who is manager of the Dis- trict office. · $9,000. He has 12 assistants, who receive from $2,600 to Mr. BLANTON. He is not here now? $4,600. The corporation counsel gets $9,000. He has 16 Miss MERRI'IT. He is in California, on a. business trip. assistants, who get from $2,600 to $7,000 each. The coroner Mr. BLANTON. He is having a good time out there, in Hollywood? gets $3,200. The superintendent of weights and measures Miss MERRITT. I hope so. , Mr. BLANTON. How long has he been gone? gets $3,700. The architect gets $7,500. He has 39 assistants, Miss MERRITT. About 3 weeks, and will be back at the end of this who receive from $2,600 to $5,600 each. The public utilities week. has 15 employees, who receive from $2,600 to $5,000 each. Mr. BLANTON. And that will be a month that he has been out at The superintendent of insurance gets $4,600. The surveyor Hollywood? Miss MERRITT. In California, looking into the California employ­ gets $5,000. The director of traffic gets $7,500. The chief ment service, with reference to their coming under the Wagner­ librarian gets $8,000. He has 15 assistants, who get from Peyser Act. $2,600 to $4,600 each. The register of wills get.s $6,400. The Mr. BLANTON. Yet he is at the head of the employment service for Washington, the District of Columbia, which has nothing to do recorder of deeds gets $5,500. The director of highways gets with California; is that right? $7,500. The tree superintendent gets $5,200. The sewer Miss MERRI'IT. Yes. director gets $7,500. The refuse supervisor gets $6,000, and Mr. BLANTON. You do not look after Californla., do you, as hlS 2 assistant.s $5,000 each, and 11 other assistants who get assistant? Miss MERRITT. No. from $2,600 to $3,800 each. The playgrounds supervisor gets Mr. BLANTON. Then there are three District employees working $4,600. The health officer gets $7,000. He has 25 assistants, there now? · who get from $2,600 to $5,600 each. The director of public Miss MERRI'IT. In addition to the janitor. Mr. BLANTON. And there are 25 tha.t were appointed by Misa welfare gets $8,000. The juvenile judge gets $7 ,000. The Perkins' Department? Gallinger superintendent gets $7,500. The superintendent of Miss MER.RnT. Yes. schools gets $10,000. The water superintendent gets $5,800. • HEAD OF CHILDREN'S TUBERCULOSIS HOSPITAL And the hundreds of other employees get proportionate Mr. BLANTON. You are a regular, practicing physician? salaries. ' Dr. FlNuCANE. Yes, sir. I 63 Mr. BLANTON. A graduate of what school? now quote from page of the printed hearings: Dr. FINUCANE. Of Georgetown University. PERSONAL PROPJ!=RTY EXEMPTIONS Mr. BLANTON. And your age is what? Mr. BLANTON. What ls the exemption that is allowed each fam- Dr. FINUCANE. Thirty-one, sir. ily for purposes of taxation? Mr. BLANTON. You graduated when? Mr. RICHARDS. On household goods? Dr. F'INucANE. In 1927. Mr. BLANTON. On everything. What are the exemptions? Mr. BLANTON. How long have you been connected with this Mr. RICHARDS. Only household goods. sanatorium.? Mr. BLANTON. Amounting to what-$1,000? Dr. FnrocANE. I was appointed 1n February. Mr. RICHARDS. $1,000. Mr. BLANTON. Of this year? Mr. BLANTON. Each family in the District is allowed an exemp- Dr. FINUCANE. Yes, sir. tion from truces on household goods of $1,000? Mr. BLANTON. By whom? Mr. RICHARDS. Yes. . Dr. FINUCANE. By the District Commissioners, on the recommen­ Mr. BLA.NJ!QN. And in addition to that their libraries? dation of the Boa.rd of Public Welfare. Mr. RicHJ.B,os. Yes. Mr. BLANTON. After your graduation from the Georgetown Uni­ Mr. BL~N. If a. man owned $1,000 worth of household furni­ versity, how many years' practice did you have in your medical ture and he had a $100,000 private library, he would have $101,000 profession? worth of property exempt from taxation? Dr. FINUCANE. I have had no private practice at all. Mr. RICHARDS. Yes, sir. Mr. BLANTON. What pay did you get at the first hospital? Dr. FI~cANE. At the first hospital I did not receive any pay. Every time the Government wants a piece of property, Mr. BLANTON. You served your first year without pay? Dr. FINUCANE. Yes, sir. the Washington citizens who sit on the jury to assess the Mr. BLANTON. Just for the experience? amount the Government must pay for it, invariably charge Dr. FINUCANE. Yes, sir. 612 CONGRESSIONAL RECORD-HOUSE JANUARY 17 Mr. BLANTON. And the next 2 years you were paid what? Mr. BLANTON. You get the same salary that a United States Dr. F'INucANE. I started at Mount McGregor being paid $50 a Senator and Member of Congress gets; that is, the same basic month. salary? · Mr. BLANTON. And you ended by being paid what? Dr. BALLOU. So I understand, sir. . Dr. FINUCANE. $75 a month. Mr. BLANTON. And that is $1,000 more than the basic salary of Mr. BLANTON. You worked the first year as an inteme there at the Com.missioners, which is $9,000? Mount McGregor for $50 a month? Dr. BALLou. I do not know what their salary is, sir. Dr. FINUCANE. Yes, sir. Mr. BLANTON. It is $9,000. I will ask you if it is not a fact that a Mr. BLANTON. And the second year for $75? great many full professors in first-class universities are getting far Dr. FINUCANE. Yes, sir. less than $10,000? Mr. BLANTON. Then you went where? Dr. BALLOU. Without doubt. Dr. FINUCANE. To the Tuberculosis Hospital in Washington, D. C. Mr. BLANTON. Are there not a •great many full professorships in Mr. BLANTON. You entered that when? many of the principal universities whose pay is not more than Dr. FINUCANE. In July 1930. $5,000? Mr. BLANTON. In what capacity? Dr. BALLOU. I do not know, but I should presume there were. Dr. FINUCANE. As assistant resident physician. Mr. BLANTON. Is. it not a fact that there are presidents of vari­ Mr. BLANTON. At what salary? ous universities who are getting not more than $6,000? Dr. FINUCANE. $80 a month. Dr. BALLOU. I presume that is so, but I have no definite knowl­ Mr. BLANTON. You were there how long? edge of that. Dr. FINUCANE. Up until I was appointed as superintendent of the SALARIES OF IDGH-SCHOOL TEACHERS children's institution. Mr. BLANTON. This year? Mr. BLANTON. Are there not some that get $3,200? Dr. FINUCANE. Yes, sir. Dr. BALLOU. There is a superior-salary class which ranges from Mr. BLANTON. Give the committee the mutations in your salary $2,900 to $3,200. from the time you went there at $80 a month until you left. Mr. BLANTON. How many high-school teachers are getting Dr. FINUCANE. I received $80 a month until the position was clas­ $3,200? sified in December of 1930, I believe it was, at $2,600 a year as the Dr. BALLOU. I could not answer that offhand. basic salary. Mr. BLANTON. There are a great many, are there not? Mr. BLANTON. Then you jumped, immediately after being here- 6 Dr. BALLOU. No; not a large number. There have been only 30, months, from $80 a month to how much? 40, or 50 promoted in any given year, and that plan has only been Dr. FINUCANE. A basic salary of $2,600. in operation 4 or 5 years. Mr. BLANTON. You have drawn that ever since while you were Mr. BLANTON. How many would you say, according to your best there? judgment, get $3,200 now as their basic salary, and will get it dur­ Dr. FINUCANE. Yes, sir. ing this next fl.seal year? Mr. BLANTON. And then you left there in the first part of this Dr. BALLOU. There are 136 teachers in the superior-salary class year at the salary of $2,600 and entered this new tuberculosis sana­ 1n the high_schools, and there are 488 who are not in that salary torium at a salary of what? class in the high schools. Dr. FINUCANE. A basic salary of $3,800. TEACHERS ELSEWHERE IN THE UNITED STATES Mr. BLANTo·N. Then you jumped by an increase of $1,200 over night? (Statement of Dr. J. D. Sandefer, president Hardin-Simmons Dr. F'INucANE. Yes, sir. . University, Abilene, Tex.) Statement showing number of men in each grade and salaries, Mr. CANNON. We have with us this morning Dr. J. D. Sandefer District of Columbia fire department and shall be glad to have a statement from him. Judge BLANTON 1 chief engineer ______will preside. $8,000 Mr. BLANTON. You are Dr. J. D. Sandefer, of Abilene, Tex.? 2 deputy chief engineers ______5,000 16 battalion chief engineers ______Dr. SANDEFER. Yes, sir. 4,500 Mr. BLANTON. You have been in New York for a couple of weeks 1 fire marshal------5,000 on business and are on your way home, going through Washington? 1 deputy fire marshal------3,000 Dr. SANDEFER. Yes. • 7 inspectors ------2,460 Mr. BLANTON. And I asked you to come here? 47 captains ______------3,000 Dr. SANDEFER. Yes, sir. 46 lieutenants------2,840 Mr. BLANTON. Doctor, there is, is there not, at Abilene, Tex., a 49 sergeants------2,600 university of the first class, known as the Hardin-Simmons Uni­ 1 superintendent of machinery ______5,000 versity? 1 assistant superintendent of machinery ______3,000 Dr. SANDEFER. Yes. 2 pilots ------· 2,600 Mr. BLANTON. That 1s a university of the first class? 2 marine engineers ______2,600 2 assistant marine engineers ______Dr. SANDEFER. Well, it ranks with other schools in Texas calUng 2,460 themselves universities. Of course, some of the others have courses 2 marine firemen------2,100 in law and medicine and are a great deal more comprehensive, but 690 privates------1,900-2,400 our work 1s accredited everywhere, both for the undergraduate de­ Total uniformed personnel, 870. grees and for the M. A. work. We do not offer anything beyond an M. A. degree. The salaries to the officers and 1,304 patrolmen on the Mr. BLANTON. You are recognized in the United States and in Metropolitan Police force in Washington are comparable Europe, are you not? to the above salaries paid to firemen. Dr. SANDEFER. Our graduates are accepted in all of the standard institutions of learning in this country, and the Ambassador from SALARIES OF SCHOOL OFFICERS France wrote us many years ago and said that any of our students I quote the following from the evidence of Superintendent wanting to take the doctor's work in France would have their work for that accepted at face value. Ballou: Mr. BLANTON. You have been president of the Hardin-Simmons Mr. BLANTON. Your salary.is $10,000, and it has been $10,000 for University for 26 years? how long? Dr. SANDEFER. Yes. - Dr. BALLOU. Oh, for several years; I have forgotten what year it Mr. BLANTON. And Hardin-Sifnm.ons University is a member of was made that. the Southern Association? Mr. BLANTON. Since 1927? Dr. SANDEFER. Yes. Dr. BALLOU. About that time, I should think. Mr. BLANTON. Is that the university that has what ts known as Mr. BLANTON. The basic salary of your assistant now is what? the "cowboys' band", that has an international reputation, that Dr. BALLOU. The next lower salary is for the first assistant is internatio"1ally known? superintendents, and their salaries run from five to six thousand Dr. SANDEFER. Yes. dollars. Mr. BLANTON. Is it the one which went to Europe a few years Mr. BLANTON. Practically all of them by reason of their seniority ago? are getting $6,000 now? Dr. SANDEFER. Yes. Dr. BALLOU. Most of them are, but I think not all of them. Mr. BLANTON. And toured Europe? Mr. BLANTON. Your assistant superintendents get what? Dr. SANDEFER. Yes. Dr. BALLOU. From $4,200 to $4,700. Mr. BLANTON. And you went With them? Mr. BLANTON. And they get $4,700 now? Dr. SANDEFER. Yes. Dr. BALLou. Not all of them, but most of them. Mr. BLANTbN. And it has been down in Old Mexico? Mr. BLANTON. How many assistant superintendents have you? Dr. SANDEFER. Yes. Dr. BALLOU. We have five. Mr. BLANTON. And 1s going back to Europe next year? Mr. BI.ANTON. Do not all five of them get $4,700? Dr. SANDEFER. Yes. Dr. BALLOU. No; because one was appointed last year. She was Mr. BLANTON. You have been to New York many times? appointed at $4,200, less the reduction. Dr. SANDEFER. Yes. Mr. BLANTON. Then four of them get $4,700? Mr. BLANTON. Is Mr. Walker, the city editor of the New York Dr. BALLOU. Yes; I think so. Tribune, related to you by blood or marriage? Mr. BLANTON. They used to get $3,500? Dr. SANDEFER. He 1s my son-in-law; he married my second Dr. BALLOU. Yes; approximately. · daughter. 1935 CONGRESSIONAL RECORD-HOUSE 613 Mr. BLANTON. Doctor, the ma.in reason I have asked you here 1s Mr. BLANTON. Are they from men who a.re graduates of recog­ to get some idea about salaries that are pa.id in universities, includ­ nized, big universities, like Yale, Harvard, Cornell, Princeton, and ing the ones in this vicinity, and to find out something about the Columbia? deductions in salaries that have been made during the depression Dr. SANDEFER. Yes; from the leading universities of the Nation. in universities. Mr. BLANTON. Are they or not anxious to work at low salaries? As president of the Hardin-Simmons University before the Dr. SANDEFER. They have been; yes. depression came, what was your basic salary? Mr. BLANTeN. And apply for those positions? Dr. SANDEFER. Mine, individually? Dr. SANDEFER. Yes. Mr. BLANTON. Yes; as president of the university? Mr. BLANTON. Is this a fair picture of your plant there [indicat­ Dr. SANDEFER. $6,000. ing photograph] ? Mr. BLANTON. In reference to Dr. Olsen, who has been with your Dr. SANDEFER. That 1s an exact reproduction of the university university a long time, what qualifications has he? He is a gradu­ plant of 12 buildings, the layout of the campus, the trees, and ate of what university? everything. Dr. SANDEFER. He is a Ph. D. from Yale, and he did additional Mr. BLANTON. Your campus embraces about 40 acres? graduate work in Berlin and in Cambridge, England. Dr. SANDEFER. Yes. That ls just as it appears from the air. Mr. BLANTON. He has been professor of what for how long? Those buildings are all there, and, incidentally, they have all been Dr. SANDEFER. He has been professor of physics for 32 years. · built during my 26 years. Mr. BLANTON. What was his basic salary before the depression? Mr. BLANTON. Mr. Chairman, I wanted Dr. Sandefer merely to Dr. SANDEFER. It was $3,000. give the committee an idea of what ls going on in other places Mr. BLANTON. Who holds the chair of mathematics down there than Washington. in your university? Let me ask you one other question. From your famil1arity with Dr. SANDEFER. Dr. Burnham. school matters, what is the average salary of grade-school teachers Mr. BLANTON. What was his basic salary before the depression? in our graded schools in our city of Abilene, of 25,000 people? Dr. SANDEFER. $3,000. Dr. SANDEFER. They did run as low as $65. Mr. BLANTON. What was the basic salary of your professor of Mr. BLANTON. You mean $66 a month? Latin? Dr. SANDEFER. Yes; for the 9 months. They are raised now. I Dr. SANDEFER. Twenty-four hundred dollars. We do not class her think I can speak fairly accurately when I say they are raised to as a full professor. She is head of the department, but we class $80 and $85, up to $100 or $110 or $115. I do not have the last her as an associat.e, and therefore the salary ls put at $2,400. figures. Mr. BLANTON. Have you any lady director of playgrounds drawing Mr. BLANTON. At one time you think they did get as low as $65 $4,600 a year down there? Dr. SANDEFER. No; we do not have any director of playgrounds. during the depression? Mr. BLANTON. There is a Miss Head, who has been the matron in Dr. SANDEFER. A few of them. your girls' dormitory a good many years? I wonder what the constituents of my good friend, Mr. Dr. SANDEFER. For 12 or 15 years. Mr. BLANTON. And she is from one of the best families in the DmxsEN, back in Illinois would think if they knew that from South, is she not? this fioor he had criticised the members of a committee that Dr. SANDEFER. Yes. did nothing in the world but call the attention of this House Mr. BLANTON. What was her basic salary before the depression? Dr. SANDEFER. A hundred dollars a month and her living. She to the fact that the taxes here in Washington are lower than has a room and an office in the dormitory. anywhere else in the United States. Where he and h!8 Mr. BLANTON. What does Dr. Stevenson, your professor of poli­ people pay a big gasoline tax in Illinois, they pay 2 cents tics, get? here. Where they have an income tax there, they have none Dr. SANDEFER. Twenty-four hundred dollars. Mr. BLANTON. You also have a man there who ls quite a well­ here. Where tbey have an inheritance tax in lliinois, they known scientist, a Dr. Richardson? have none here. Where they have a license-tag tax there Dr. SANDEFER. He ls an historian, the author of two books re­ according to the kind of automobile used, here they have an cently off the press. Mr. BLANTON. He is connected with various scientific institu­ auto tax of only $1 for all cars. They pay $1.50 here as a tions and organizations? total tax that embraces schools and everything else, while Dr. SANDEFER. Yes. in Illinois they have a State tax and a county tax and a city Mr. BLANTON. He ls president of a Texas archeological associa- tax, as well as school taxes and various other kinds of tax­ tion, ls he not? Dr. SANDEFER. He is an officer. ation. While here in Washington they have an intangible Mr. BLANTON. What salary does he get, Doctor? tax of one-half of 1 percent, with hundreds of millions of Dr. SANDEFER. $3,000. intangibles in lockboxes escaping all taxation, but in lliinois Mr. BLANTON. Those were all predepression salaries? If Dr. SANDEFER. Yes. they are taxed in a great amount. his people could know Mr. BLANTON. Since the depression, what ls your present salary as all the facts, would they approve of his criticism of this president of the university? committee? · Dr. SANDEFER. Thirty-six hundred dollars. Mr. BLANTON. What do the other full professors, like Dr. Olsen, Mr. DITTER. Mr. Chairman, will the gentleman from get now? Texas yield? Dr. SANDEFER. They draw $250 a month for the 9 months. If they Mr. BLANTON. Certainly, should do work in the summertime, there would be a supplement to that. Mr. DITrER. In view of the fact that my colleague the Mr. BLANTON. All of them have taken cuts? gentleman from lliinois [Mr. DIRKSEN] is not in the Cham­ Dr. SANDEFER. Yes. ber at the present time-- Mr. BLANTON. What ls the greatest cut you yourself have ta.ken during the depression? Mr. BLANTON. He is busy on other official business else­ Dr. SANDEFER. Those in the lower brackets took cuts amounting to where in the Capitol. 25 percent, and those cuts run up to my own cut of nearly 50 Mr. DI'ITER. He is unavoidably absent in committee percent. meeting. You understand, where the money for salaries does not come in regularly I do not get my $300 a month. I got $2,700 a year once Mr. BLANTON. Most of the time he is here. and $2,900 one year. Mr. DITTER. May I remind the gentleman from Texas Mr. BLANTON. After cutting your salary from $6,000 to $3,600, of the fact that the gentleman from Illinois is a member of when do you get the $3,600? Have there yet been made any restora­ tions in salaries or cuts? the District of Columbia Committee? Dr. SANDEFER. No. Mr. BLANTON. Oh, yes; but just a new member. While Mr. BLANTON. You have not been able to make any restorations yet? he is able and energetic, he has not been a member long Dr. SANDEFER. No; not yet. enough to find out conditions here. Mr. BLANTON. You have a corps of professors composed of some Mr. DI'ITER. But the gentleman from Texas will con­ forty-odd men? his Dr. SANDEFER. Yes. cede that during first term, no man in the House was so Mr. BLANTON. Have any of.them quit you? willing to carry his share of the work of the House or more Dr. SANDEFER. We have not lost anyone. adaptable than the gentleman from Illinois [Mr. DIRKSEN]. Mr. BLANTON. They have all stayed with you? Mr. BLANTON. Certainly; I will admit that, because I Dr. SANDEFER. Every one. Mr. BLANTON. And been loyal to the institution? am his friend. I prefaced my remarks by saying that he is Dr. SANDEFER. Yes; every one. a splendid, active, new legislator. Mr. BLANTON. As president of a university; I wish you would state Mr. DITTER. And conscientious. what the situation ls as to there being many appllcatlons from men with degrees of Ph. D. from eastern universities for positions Mr. BLANTON. To the highest degree. at those low salaries. Do you have many such applications? Mr. DITTER. And the gentleman wants to encourage Dr. SANDEFER. Dozens of them. him now as a new man. 614 CONGRESSIONAL RECORD-HOUSE JANUARY 17 Mr. BLANTON. Certainly; and after he stays here 8 or a monument to their own ability. They fail utterly to appre­ 10 or 15 years longer and learns all about the intricate, ciate the importance of the rural roads. There is no ques­ devious ways that Washington has of getting money out of tion but that road construction9 offers the best method of the Public Treasury, then I will say, "Brot.µer DIRKSEN, you public-works relief. A road is usable immediately after it know as much as we do about these things." [Laughter is finished. While I am much in favor of reforestation and and applause.] · erosion projects, these must usually run for some years Mr. Chairman, I have not criticized the Washington peo­ before their utility is appreciated. Not so with roads. Good ple. I have not denounced them. I have merely given a roads improve -the value of lands as well as provide comfort recitation of the facts. I have merely put things in the and many other advantages to those who can use them. RECORD that meir own Commissioners have stated. Who The construction of country roads calls for a very large per­ are their Commissioners? Mr. Hazen, who is the chairman centage of what is called "general labor." The common of the Board, for 30 years has been an official of the Dis­ everyday man in country and city is given an opportunity trict government. For many years he was the surveyor of to .work. There are not many highly skilled men or artisans the District and he knows the history of the District of employed; still there are a few. Columbia. I have been surprised that the President has not seen fit [Here the gavel f ell.J to lay special stress on road construction from the standpoint Mr. DITI'ER. Mr. Chairman, I yield 10 minutes to the of usefulness and public benefit now and in the future. I gentleman from Ohio [Mr. JENKINS]. hope he does yet take special notice of the importance of those projects. Mr. JENKINS of Ohio. Mr. Chairman, ladies and gentle­ The following is a copy of one of the bills which I intro­ men of the Committee, I take the :floor this afternoon to discuss duced today: a very important matter. I have today introduced two very H. R. 4121 important measures, both of which deal with the improve­ A bill to amend the Federal Aid Road Act approved July 11, 1916, as ment of the rural roads of the whole United States. Each amended and supplemented and every Congressman here will be interested in these bills, Be it enacted, etc., That for the purpose of extending the benefits for a very large majority of you have many rural roads in of the Federal Aid Road Act more equitably to the rural sections of the United States, the said act be, and hereby is, amended to your districts, and everyone is forced to admit that the whole provide that out of any and all moneys apportioned to the several country, city and rural, is benefited by what will benefit States under the terms of said act for any fiscal year beginning those who produce the food, the lumber, the cotton, and the with the fiscal year ending June 30, 1936, not less than 25 percent minerals of the country. of the apportionment to any State shall be applied to the construc­ tion or reconstruction of rural roads lying outside the 7-percent The· growth and development of the legislation providing Federal-aid system, which rural roads shall be such as the Secre­ for Federal aid to public roads has been gradual and fairly tary of Agriculture shall determine to be primarily of service to progressive and consistent. The first Federal-aid laws, the rural population in the operation of public-school bus routes, rural free-delivery mall routes, and star mall routes. No part of under which we operate now, have their practical bases in such 25 percent ts to be used for the construction or reconstruction the law of 1916 and the law of 1921. These laws are still of a highway or road which has been designated as a part of a Fed­ operative. The amounts provided under those laws have eral or State highway system eligible to participate in Federal aid. varied as time progressed. . This bill seeks to amend the original law of 1916 and 1921 In 1933 Congress took a step forward in providing money so that 25 percent of whatever is appropriated by the Federal for road improvement. One of the provisions of the National Government to the various States should be used exclusively Industrial Recovery Act provided that $400,000,000 should be on rural roads. If this bill is passed, the Federal Highway De­ divided among the several States. The division was made partment and the State highway department will be com­ along fair lines. Twelve and one-half percent was divided pelled to use this amount of this money on rural roads. They among the States according to population, and the remainder will not then be able to conjure up any excuses. This will was divided according to area, and road mileage, and popula­ allow 75 percent to be used on the main thoroughfares, where tion. This appropriation was made only for a limited time, they are now using the whole 100 percent, and will compel and the same is not now in effect. them to use 25 percent on rural mail routes and school-bus In 1934 Congress again enacted special legislation for routes. The main-thoroughfare advocates should be satis­ another limited time. Under the provisions of the Hayden­ fied with this. In fact, I feel that this money should be di­ Cartwright bill $200,000,000 was appropriated to be divided vided 50-50. That would be a more fair division. But, out of among the several States according to the same provisions as respect for the former division, I have made it 25 percent in those provided in the National Industrial Recovery Act, ex­ this bill. cept that this bill carried what was known as the " Jenkins There are many arguments that I can advance for the pas­ amendment." This amendment provided that not less than sage of this bill. I know that every Congressman here this 25 percent of the appropriation to any State shall be applied afternoon has many arguments that he can advance. I will to secondary or feeder roads, including farm-to-market not consume your time in advancing any arguments except roads, rural mail routes, and public-school bus routes. to say that 37 percent of our population lives outside of the This amendment was offered from the floor and was cities, yet only 16 pereent of the automobiles are owned by adopted. The fairness of the amendment appealed to all that 37 percent. The rural man has more use for an auto­ Congressmen familiar with rural roac;i conditions. mobile than does the city man, but the city man owns the The Hayden-Cartwright bill was only a temporary measure automobile largely for pleasure, while the rural man cannot and will not continue into the coming year. If it is re­ even operate an automobile, which he needs very badly in his enacted it should carry an amendment making the 25 per­ business. Marketing his product and educating his children cent amendment more certain of enforcement. The Federal are more important to the rural man than is the producing Highway Department, which apparently is very jealous of its of his crop. It is also very important to the city man that power and prestige, failed to enter into the spirit of this the rural man can bring his products to the consumer in the amendment granting relief for the rural people, but on the city. This bill should pass; and if it does, it would be a piece contrary restricted its activities until it was practically im­ of permanent legislation which is fair. If it fails, then the potent in some States, especially Ohio. Likewise some of the rural man will be served a great-injustice. The same fair­ highway directors also failed to appreciate their responsi­ mindedness shown by a large majority of the House in passing bility to the rural people. Especially was this true in Ohio. the amendment offered by me in the last session of Congress If the State road officers in Ohio had done their duty there will, I am strre, manifest itself again when · the occasion would have been $2,000,000 spent on Ohio rural roads in presents. 1934. They failed miserably. The reason for this failure The other bill which I introduced has the same purpose on the part of these high road officials is that they are sold in view. It differs from the first bill in that it is temporary on the idea of building main thoroughfares and expensive in its nature. It is intended to operate only for 3 years. and elegant bridges, to which they can point with pride as The following is a copy of it: 1935 CONGRESSIONAL RECORD-HOUSE 615 Joint resolution providing for improvement of rural roads The CHA.ffiMAN. The gentleman from Ohio asks unani­ Whereas there 1s much unemployment throughout all parts of mous consent to revise and extend his remarks. Is there the United States; and Whereas the construction and repair of public roads 1s one of objection? the best methods of relievUig unemployment; and There was no objection. Whereas there are yet many miles of unimproved roads on Mr. CANNON of Missouri. Mr. Chairman, I yield 2 min­ which rural free-delivery mail routes, star mail routes, and publlc­ school bus routes operate: Therefore be it utes to the gentleman from Pennsylvania [Mr. DUNN]. Resolved, etc., That for the purpose of increasing employment Mr. Dillffi of Pennsylvania. Mr. Chairman, many Con­ and for the purpose of improving the Postal Service and the edu­ gressmen at this session as well as the last session Introduced cational advantages of the youth of the Nation there 1s hereby authorized to be appropriated out of any money in the Treasury old-age pension bills. At the last session of Congress I intro­ not otherwise appropriated the following sums: $150,000,000 for duced one and made the age limit 50 years. the :fiscal year ending June 30, 1936; $100,000,000 for the fiscal year I maintain that the time has come when we should provide ending June 30, 1937; and $100,000,000 for the fiscal year ending June 30, 1938. a pension for every man and woman who has attained the Such sums shaH be apportioned among the several States, age of 50 and who is out of employment. It is an absolute seven-eighths in a.ccordance with the prvvisions of section 21 of fact that in practically every industry in the United States, the Federal Highway Act, approved November 9, 1921, as amended when a man or a woman applies for a job, and they have and supplemented (which act is hereby further amended for the purposes of this title to include the District of Columbia), and reached the age of 50, they cannot secure employment. And one-eighth in the ratio which the population of each State bears it is also true that in many departments of the Government to the total population of the United States according to the a man who has reached the age of 50 cannot obtain a position. la.test decennial census. And said sums shall be expended only on rural free-delivery mail routes, star mall routes, and public-school What are we going to do with these men and women? bus routes. It is my candid opinion that it would be more economical And no part shall be expended or used on a highway or road and humane to give a pension to all those who have attained which has been designated as a part of a Federal or State high­ way system and eligible to participation in Federal aid for roads the age of 50 rather than have them compelled to join the constructed as primary or secondary roads or routes. breadline and go into poorhouses. We know most of the No part of the funds appropriated hereunder to any State need money that is appropriated for the maintenance of poor­ be matched by funds from that State. houses is spent for overhead expenses. So, ladies and gentle­ The specifications and plans for the roads and highways con­ structed or improved by the appropriations herein provided for men, I will introduce a bill and ask you to support it, and I shall be prepared by such agencies as the Postmaster General am going to make the age limit 50 years. [Applause.] and the Secretary of Agriculture shall designate and shall meet Mr. CANNON of Missouri. Mr. Chairman, I yield 5 min­ the approval of said Postmaster General and Secretary of Agriculture. utes to the gentleman from Missouri [Mr. CocHRANl. The amount apportioned hereunder to each of the several States Mr. COCHRAN. Mr. Chairman, for many years the ques­ shall be allocated to the various counties of that State in the tion of the Government competing with private business has ratio that the total of the rural free-delivery mall routes, the star mall routes, and the public-school bus routes operating in any been an issue in both Houses of Congress and also discussed county on roads not a part of a Federal or State highway system, on the floor of this House. Both political parties, from time either primary or secondary, bears to the total rural free-delivery to time, have included planks in their platforms pledging to routes, star mail routes, and public-school bus routes operating in the whole State on roads not a part of the Federal or State eliminate Government competition with private industry. highway system, either primary or secondary. In the last Congress a bill was introduced which provided The selection of the highways and roads to be constructed or for the setting up of a cost-accounting system. That bill was improved in any county of any State 1s to be left to the county commissioners of that county. The supervision of the construc­ ref erred to the committee of which I am chairman. Propa­ tion or improvement 1s to be left to such agencies as the Secretary ganda, the like of which you never saw, soon appeared in of Agriculture and the Postmaster General may select. support of the legislation. The bill was introduced in the This bill provides specifically that the money appropriated closing days of the first session of the Seventy-third Con­ thereunder must be spent on rural roads. It cannot be spent gress. When the second session met, the committee held on these great thoroughfares which in many cases have been hearings upon the bill. Even while the committee was hold­ built where there is not half as much traffic as is carried on ing hearings I was receiving telegrams saying that the com­ many dirt roads in many sections of the United States. It mittee was not giving a fair opportunity to those who is reliably estimated that there are 59,000 miles of heavily favored the bill to be heard. Testimony of the various Gov­ constructed roads in the United States in excess of the needs ernment agencies showed that if the bill were enacted into for the same. These unnecessary miles have cost more than law as introduced it would cost the Government millions of $600,000,000. We have gone to extremes in this respect. We dollars to enforce it, and there would be no benefit as a cannot go to extremes in the other direction so long as result. The Comptroller General favored the bill in part, but there are thousands upon thousands of rural people who are told me personally, in view of conditions, this was a bad bound to their homes several months of the year because of time to pass it. bad roads. If this bill should pass, the local road authorities In the last issue of the CONGRESSIONAL RECORD of the could then be free to extend their efforts farther into the Seventy-third Congress, which was published probably 2 rural sections to the benefit of those who are the most weeks after we adjourned, the gentleman from Missouri [Mr. helpless now. SHANNON], author of the bill, and the gentleman from Penn­ This bill proposes a division of authority in determining sylvania [Mr. RICH], a member of my committee, both as­ the location of the roads to be improved. It gives the sailed me because that bill did not get out of the committee. county commissioners a chance to have some authority. Of course, I had no opportunity to answer them. The commissioners are elected by the people and know the I am chairman of the committee, but I have only one vote wants of the rural people. The Government will, under this in the committee. I opposed the bill as introduced and bill, furnish the money and provide the plans and specifica­ would oppose a similar bill now. It so happened, however, tions and provide the supervision and machinery, but the after the hearings were concluded. that it was agreed that higher authorities will not have the full power. The rural an etf ort should be made to get together with the Comptroller people themselves through their county commissioners will General, some officials of the various departments who were have to be consulted. opposed to the original bill, and those who favored the bill, Either or both of these bills will be of great benefit to the to see if some legislation could not be drawn up that might rural man who now is in the mud. If I can help bring him be beneficial and at the same time not cost the Government relief, I shall feel amply repaid for the efforts that I have millions of dollars to install. The gentleman from Pennsyl­ expended through the years. If these bills or similar bills vania [Mr. RICH] ca.me to me and asked me to please delay should not pass, I will still keep fighting on, for there is no any action on the bill until he had an opportunity to go question but that our cause is right and just. [Applause.] to Pennsylvania and attend the marriage of his niece. He Mr. Chairman, I ask unanimous consent to revise and went away, and as the RECORD will show, he was absent extend my remarks, in which I shall continue this valuable from this House on roll call after roll call in the closing discussion. Clays of the session, and he never did come back to me 616 CONGRESSIONAL RECORD-HOUSE JANUARY 17 and ask me to take any action; and I kept my word with said this factory in his State was the outstanding offender. him and let the matter rest. If the gentleman from Pennsylvania [Mr. RICH] does not Mr. Chairman, another bill was introduced the other day, desire to offer the amendment which will stop that factory I have not had time to read it. It may be the same bill. in his State from competing with private industry, then I However, some of the departments have called up and asked shall offer it myself, but I shall expect the gentleman to me to let them be heard in the event the bill is taken up, one support the amendment by both voice and vote on the floor saying that it is more drastic than the original bill As I of this House. said, I have not looked at the bill and have no idea of its Mr. SNELL. Mr. Chairman, will the gentleman yield? provisions. Mr. COCHRAN. I yield. I am just as much in favor as any man in the House of Mr. SNELL. I am interested in the gentleman's state­ stopping Government competition with private industry. ment about the Government's engaging in private industry. I want to say now what I have often said, you can pass all I am in entire accord with the gentleman's statement. The the legislation that you desire with reference to cost-account­ gentleman is Chairman of the Committee on Expenditures ing systems and you will never stop the Government compet­ in the Executive Departments, and can play a very impor­ ing with private industry until the Members of this House tant part in keeping the Government out of business, be­ and the Senate stop appropriating money and legislation cause he has a right to review all these expenditures. Along making it mandatory for the departments to compete with this line, does not the gentleman think it is very much easier private industry. Cost-accoun~ing systems will not stop it for the Government to get into business when we make when you compel by legislation the departments to manu­ lump-sum appropriations? facture their own supplies. Mr. COCHRAN. I agree with the gentleman that lump­ The CHAmMAN. The time of the gentleman from Mis­ sum appropriations can cause a great deal of damage. souri has expired. Those administering lump-sum appropriations can put the Mr. CANNON of Missouri. Mr. Chairman, I yield 5 min­ Government in business and do what they ·desire. There utes more to the gentleman from Missouri. is no checking them, as the minority leader knows. Mr. COCHRAN. Mr. Chairman, the · RECORD will show But in emergencies it is necessary at times to give to the that I have attempted on the floor of this House through President, as we gave to your Republican President, lump amendment to stop the Government competing with private sums and also the power to exercise his judgment in spend­ industry on numerous occasions. ing the money. I think that in time of an emergency, no We spent over $15,000 for a special committee -to go around matter whether the President be a Democrat or a Republi­ the country to investigate what the Government was doing can, there is justification for passing such legislation, but as far as competition with private industry is concerned. only when an emergency exists. That committee held hearings in all parts of the country. The CHAIRMAN. The time of the gentleman from Mis-­ One of the most flagrant competitors of private industry souri [Mr. CocHRANJ has expired. was an Army factory in Philadelphia. A few years ago, when the Army appropriation bill was pending, I exercised Mr. DITTER. I yield the gentleman 5 additional min.. my right and offered an amendment placing a limitation utes, Mr. Chairman. upon the money appropriated therein, which limitation Mr. SNELL. Will the gentleman yield? would have closed that factory in Philadelphia. Mr. COCHRAN. I yield. This very factory, according to the special investigating Mr. SNELL. In times of extreme emergency I agree committee, manufactures nearly 100 articles that the Gov­ with the gentleman, but how long does the gentleman ernment can purchase in the open market. My amendment consider that these emergencies exist? was carried, though somewhat modified, and if it had be­ Mr. COCHRAN. If the gentleman does not know that come a law the factory would have closed up. I was ap­ the emergency which we inherited from the last Republican pealed to by Members in this House to withdraw the amend­ administration still exists, I think he is out of touch with ment. I refused. The bill went to the other side of the conditions in the country. I am sure the gentleman is too Capitol, and a Senator from Pennsylvania, who is no longer well informed not to know it. in that body, held up the bill for weeks and weeks until he Mr. SNELL. I would say that perhaps some emergencies finally succeeded in getting my amendment modified so that still exist, but the emergencies calling for huge lump-sum the factory could carry on. The gentleman from Pennsyl­ appropriations, from my understanding of conditions vania [Mr. RICH], from the State where the factory was throughout the country, certainly do not exist at the pres­ located, a member of the committee of which I am tae ent time, so that it is necessary to give these appropriations chairman, also a member of the special investigating com­ for 2 years in advance. mittee, who criticized me, offered me no_ assistance in taking Mr. COCHRAN. I repeat, the emergency which the pres­ that factory out of competition with private business. ent President of the United States inherited from the pre­ The Holman rule gives one an opportunity to offer amend­ vious President of the United States to a great extent still ments placing limitations upon appropriation bills. The exists, and nobody can deny that it exists. I will not bill before us at the present time is the second appropriation attempt to deny it, fer I know it still exists. bill. An amendment will stand on this bill or any other Now, Mr. Chairman, the gentleman from New York seeks appropriation bill under the Holman rule limiting the ex­ to take me away from expressing my thought on the Gov­ penditure of money appropriated in the bill. In this bill ernment's competing with business. I want to say again that one can prevent the District of Columbia from competing if any Member has any factories or arsenals or navy yards with private industry, if you know it is competing, by draw­ or any other Government activity in his district he wants ing the proper amendment. So it is with every appropria­ to stop, do not ask the Congress to pass bills creating a new tion bill that we will consider in this House. Here is the accounting system that will cost millions to operate, but let place to take the Government out of business and this is him come here when the appropriation bill is being con­ the only way it can be done. sidered and place a limitation upon the appropriation bill When the Anny appropriation bill comes to this floor, I which will prohibit the spending of any money to operate am going to prepare and offer the amendment which I the factory, and the factory will be closed. offered several years ago and I shall notify the gentleman In the Navy °Department appropriation bill every year we from Pennsylvania [Mr. RrcHJ that I am going to do it make provision that compels the Navy Department to manu­ and give him, if he desires, the amendment, so that he can facture its own supplies when it can do it cheaper than it offer it. If he does, I shall support him on the floor. He can purchase supplies in the open market. Everyone who was a member of the committee that spent this money to has been here in past Congresses has voted for the Navy investigate the Government competition with private indus­ Department appropriation bill and for that clause in the bill, try, which is making so much noise now about Government's and it cannot be eliminated on a point of order, because it is competing with private industry, and his special committee law. 1935 CONGRESSIONAL RECORD-HOUSE 617. Per.sonally I am not in favor -0f closing our navy yards of this proposal to pay the bonus have advocated the and arsenals; they are necessary from a national-defense retirement of that obligation through the issuance of new standpoint. But there is much competition with private in­ currency and not through the issuance of tax-exempt dustry which can be done away with. You can stop it only securities. in one way-stop appropriating money that makes it .manda­ So I want to call your attention to the fact that you a.re tory upon the various departments to compete with private confronted with the question of satisfying groups other than industry. the veterans with reference to this legislation. To illustrate, Mr. DARROW. Will the gentleman yield? if you were to pass the Vinson bill you would not be meeting Mr. COCHRAN. Yes; I yield. the demands -0f the farm leaders, who are asking for an ex­ Mr. DARROW. Does not the gentleman from Missouri pansion of the currency. Bear in mind, too, the fact that think there is a distinction between the question of national certain groups who have been vitally interested in monetary defense and other kinds of industry? reform," infiationists ",as some people call them, and icon­ Mr. COCHRAN. Absolutely; when it comes to munitions .sider myself one of this class, although I prefer to be called of ordnance or navy yards, I do; but let me ask the gentle­ a" refiationist" rather than an inflationist; but, be that as it man a question: Does the gentleman from Pennsylvania may, certain groups have been sponsoring the payment of approve of what the factory in Philadelphia was doing, as the bonus not because they particularly wanted to pay it to outlined in the report filed by the subcommittee that in­ the veterans but because they felt it was the ideal method of vestigated the Government's competing with private industry? distributing a sufficient amount of circulating currency to Mr. DARROW. The quartermaster's factory, I think, is meet the normal business demands of the Nation. So if you doing good work ordinarily. favor the Vinson bill, you will not be complying with the Mr. COCHRAN. But I should like to know if the gentle­ demand of this group; and I want to say tha,t you will have man approves of the report made by his colleague the a very difficult time justifying your position, excepting only gentleman from Pennsylvania [Mr. RicHJ? with the veterans of the Nation. Mr. DARROW. No; I do not, entirely. A few years ago Congress provided that the veterans should Mr. COCHRAN. Mr. Chairman. I yield back the balance be pe1mitted to borrow 50 percent of the full face value of of my time. [Applause.] their certificates. At that time most of the veterans took Mr. DITTER. Mr. Chairman, I yield 15 minutes to the advantage of this opportunity and borrowed as much as they gentleman from Wisconsin [Mr. BOILEAU]. were able to borrow on their certifieates. This money went Mr. BOILEAU. Mr. Chairman, during the past few days into the usual channels of trade. To some extent it cer­ there has been some increased interest and discussion with tainly did stimulate business. It helped small retail men and reference to the so-called" bonus legislation." For the past large manufacturers alike4 It helped all classes of business few years when we talked about the bonus bill it was gen­ men. erally understood that we were referring to the Patman bill, It must be remembered, too, that there is a certain group H. R. 1, the bill which provides for the immediate and of individuals who claim that the benefit derived at that time full payment of the World War adjusted-service certificates, was infinitesimal, that it was not significant, that it did not and which provides that this mo~y shall be made available really stimulate business to the extent that it could be con­ through the issuance of new eurrent!y, and t~t no bond side.red wise eeonomically from the standpoint of the general issue or levy of taxes would be necessary to pay off this welfare of the Nation. I am not so sure of that. There may obligation to World War veterans. be some justification on the pa.rt of those who have some When we have talked about the bonus in the past few apprehension as to the real merit of the bill providing for years it has generally been regarded throughout the country payment of half of the bonus at that time. So far as the that we were talking about the Patman bill. I want to call general welfare of the Nation is concerned I want to say that that to your attention particularly in view of the fact that if you pass this Vinson bill you can give no more relief by within the last few days another bill has been introduced by paying the other half of the bonus than you gave when you .the distinguished gentleman from Kentucky IMr. VmsoN l, paid the first half. Payment will do the same thing; it will which is generally known as the "American Legion plan" do a tremendous amount of good; it will give the veterans an for the payment of the bonus. I want to call to yOtll' atten­ opportunity to reestablish their credit. No doubt most of this tion the fact that there is a very great difference between money will leave the hands of the veterans and go into the the provisions of those two bills, with reference to the hands of those who can use the money advantag~usly in method of making the money available for the purpose of establishing their own credit or exti.nguiShing debt. I believe paying this obligation. The Vinson bill provides merely an it would have a whole.some effect upon the Nation; but you authorization of an appropriation, so th~t under the terms cannot expect any more benefit under the Vinson bill than of that bill the money will be made available in the usual was given under the bill whicll provided for the payment of way, which will be through the issuance of bonds, the the first half of the bonus. levying of taxes, the issuance of more tax-exempt, interest­ On the other hand, if you pass the Patman bill and thereby bearing bonds. put into cireulation over $2,000,000,000 of new currency, you This is a question in which many groups of people other will materially increase the price level of all commodities. than veterans have been interested. The bonus question .can Bear in mind that the Patman bill has a very definite check no longer be considered a veterans' problem, because other against unduly increasing the price level, so there is no dan­ groups have been very much int.erested in the provisions of ger of inereasing prices above the 1926 level, which is the the Patman bill. The National Farmers Union, for instance, objective of the monetary reformers. It is the objective of and other farm organizations, have gone on record at na­ those who have been and still are sponsoring the Patman bill. tional conventions for the last 3 or 4 years, favoring the The issuance of this new currency would put an additional payment of the bonus to the veterans; but I want to call amount of cUITency in circulation and would to some extent to your attention the fact that at the same time the Na­ at least cheapen the value of the dollar. We hope it will tional Farmers Union passed a resolution urging the payment cheapen the value of the dollar to where it was in 19264 As I of the bonus, in the same convention they passed resolu­ say, the bill has a perfect check and control, so that there is tions condemning the practice of issuing interest-bearing, no possibility of the bill's operating to increase prices above tax-exempt securities, showing very de:finit.ely that the farm the 1926 level groups who have supported this legislation have done so The Vinson bill apparently anticipates merely authorizing because they have.been advocating an expansion of the cur­ an appropriation, which means the Government will sell rency. They have been opposed to the issuance of tax­ bonds, take this money out of circulatio~ put it in the Treas­ exempt securities. ury, and pay it right out to the veterans. SO, after the oper­ I wish to say further that there has been an effort on ation is completed, there will not be one additional dollar of the part of some veterans' organizations to propagandize currency in circulation, because that bill would take the this particular proposal, and in each ·instance the leaders money out of circulation and then put it back into circulation 618 CONGRESSIONAL RECORD-HOUSE JANUARY 17 by paying it to the veterans; but if we expand the currency backing to the currency in circulation. So that if we ignore as is provided in the Patman bill we will increase the cur- the silver which we have, and which should not be done, and rency in circulation and it will have a wholesome effect just say that we have a little over $8,000,000,000 in gold upon the entire country. After the provisions of the bill back of the five and a half billion dollars in currency, it is have been put into operation there will be an additional very easy to understand that we now have, roughly speaking, amount of circulating medium, an additional amount of cur- 150 cents worth of gold back of every dollar of currency i·ency with which to carry on the normal business activities of outstanding; and if we issue the $2,000,000,000 of additional the Nation. currency, we will still have much more than 100 cents of Mr. DUNN of Pennsylvania. Mr. Chairman, will the gold back of every dollar of currency outstanding. gentleman yield? This money cannot be discriminated against. True, it Mr. BOILEAU. I yield. would be paper money, but under the Gold Standard Act all Mr. DUNN of Pennsylvania. Are the Veterans of Foreign paper money issued by the United States Government and Wars opposed to the Vinson bill? the Federal reserve is redeemable in gold. That is the basic Mr. BOILEAU. I am not prepared to state that the law, so that if at a time when people could redeem their Veterans of Foreign Wars are opposed to the Vinson bill, but paper money with gold, a reserve of 40 percent gold was I am prepared to say that the Veterans of Foreign Wars for sufficient to back up the currency, it seems to me that 150 several years have been advocating the enactment of the percent ought to be adequate security or an adequate re­ Patman bill. On several occasions at the request of the serve back of your currency when you cannot get the gold national headquarters of the Veterans of Foreign Wars I if you did surrender your circulating medium. have had the opportunity of speaking to the veterans, and [Here the gavel fell.] on those occasions I, as well as other advocates of the plan Mr. DITTER. Mr. Chairman, I yield the gentleman 5 whom I have heard speak, advocated the payment of the additional minutes. bonus through an expansion of the currency and not through Mr. BOILEAU. So that if 40 percent was sufficient at a bond issue. one time, it seems to me that now one should be pemti.tted Yesterday, the gentleman from New York [Mr. FlsH], to say we have fiat money when we have $1.60 of gold or spoke at some length against the policy of issuing tax-exempt metallic base, including silver, back of every dollar of cur­ securities. I agree fully with his remarks with reference to rency outstanding, and this at a time when you cannot this particular subject. I believe the great majority of the redeem the currency outstanding in gold. We have an ade­ Membership of the House will be glad to see a start made quate amount of gold in reserve for the issuance of this against a continuation of this policy of issuing tax-e~empt currency, and so long as the crying need of the Nation is to securities. If we pass the Vinson bill it will ·mean that we expand the currency, I say that we should use the Patman will have more tax-exempt securities in existence . because plan rather than the Vinson plan for the payment of our the bill merely authorizes an appropriation and, automat- obligations to the veterans. May I remind you again of the ically, the money will be made available through the issu- fact that the payment of the bonus under the Vinson plan ance of bonds, and these bonds will be tax exempt. may satisfy some veterans. but it is not going to satisfy all I submit that there is every reason at this .time to pass of them, because the great majority of the veterans are sold the Patman bill. In the first place, you will remember that on the payment of this bonus because they believe that when this bill was first advocated the opponents raised their it will help the entire country, not only themselves. hands in horror and said: "Why, if you pass this bill you [Applause.] will drive us off the gold standard." We do not have to They are not a selfish lot. I submit, Mr. Chairman, pay­ worry about that any more. That has all been taken care ment of this bonus under the provisions of the Patman plan of and, I believe, in a very nice way. I believe the country rather than under the Vinson plan would give an immeasur­ is immeasurably better off since we went off the gold stand- able amount of relief to this country. ard. So that argument is no longer available to be used Mr. MICHENER. Will the gentleman yield? in opposition to the Patman bill. Mr. BOILEAU. I yield to the gentleman from Michigan. They also stated: "If you issue that currency under the Mr. MICHENER. How much does the gentleman feel the provisions of the Patman bill, you will be issuing fiat currency should be expanded? money", and they talked about the horrors and the terrible Mr. BOILEAU. May I say to the gentleman that I do not consequences of running the printing presses. If I have claim to know how much it should necessarily be expanded, any conception of the meaning of" fiat money", it is money but at least enough to bring back the price level of 1926. I behind which there is not a sufficient metallic reserve. I do say we should bring the price level back to the average of not claim to be a monetary expert, but I feel that I have 1926, and I believe the $2,000,000.000 will about do the trick. given the matter as much consideration as the average If it raises prices too high. then there are provisions in the Member of this House, and, although my acquaintance with Patman bill for the withdrawal of currency and putting bonds the subject does not permit me to use the finest technical in circulation in lieu thereof. terms perhaps, it seems to me like good common sense to Mr. MJCHENER. There are many Members of the House say that the issuance of $2,000,000,000 of additional currency who are interested in another expansion bill. namely, the would not by any stretch of the imagination give us fiat Lemke bill. If the Lemke bill is enacted into law, that would money. · bring about an expansion of about what? According to the figures of the United States Treasury, Mr. BOILEAU. That bill provides that there shall not be on the 1st of December last we had in excess of $8,000,000,000 in excess of $75 per capita in circulation. I am just quoting in gold in the Treasury. I assume the figures have not from memory. That is an expansion of three or four billion changed materially since. Also on that date we had dollars. $1,200,000,000 worth of silver. We had a total amount of Mr. MICHENER. If that bill creates an expansion of gold and silver of $9,400,000,000 with just slightly over five three or four billion dollars, and if it should take eight to and a half billion dollars of currency in circulation. Mr. ten billion dollars to take care of the farm indebtedness of Chairman, we could issue close to $4,000,000.000 more of cur- the country, and if we add on this additional $2,200,000,000 rency and still have 100 cents of metal back of every dollar are we not going to go further into the expansion business of currency outstanding; so that no one can make the claim than the gentleman himself or the country at large might now that the issuance of this currency will be fiat money. prefer·? · If they still use this argument, their conception of the term Mr. BOILEAU. I may say to the gentleman that the ''fiat money" is far different from mine. $8,000,000,000 that the gentleman refers to does represent Why, ander our old system when we were going along the farm debt, but no one who advocates the passage of the nicely a few years ago, we always considered that 40 percent Frazier bill will ask that we print that much currency. gold reserve was adequate. As a matter of fact, under our We ask that about $3,000,000,000 be used for the purpose statutory law we provide that 40 percent in gold is sufficient of creating a revolvmg fund to refinance these obligations 1935 CONGRESSIONAL RECORD-HOUSE 619 , and the bill has a definite check of $75 per capita of ClllTency Mr. MICHENER. I assume the gentleman ts receiving ' in circulation. mail as I do, coming from certain groups, advocating the Mr. MICHENER. But we would have to borrow that enactment of the Patman bill, the Townsend bill, and the money, if we stopped after we expanded to the extent of $75 Lemke bill. The gentleman· has made ft very clear that 1n per capita. his judgment it would be ruinous to enact any two of them Mr. BOILEAU. We create a revolving fund of about in the same session of the Congress. $3,000,000,000. Mr. BOILEAU. I should not want to say it would be ruin­ Mr. MICHENER. The thing I was trying to bring to the ous to enact the Frazier-Lemke bill and the bonus in the gentleman's attention is this: If we are in favor of the pay­ same session of Congress. I do say, however, it might be ment of the bonus in the way the gentleman has suggested, very dangerous. However, I do not wari.t to say that $2.000,- and if we are in favor of the Lemke bill, it seems to me that 000,000 or $3,000,000,000 is a sufficient amount to expand the before we commence to expand in a given direction, we currency. Maybe that· is not going to be enough, and I .do should have all of our expansion pictured, and determine say that we should use such bills to expand the currency whether or not we are going for the Lemke bill or whether until the commodity price level reaches the 1926 leveL and we are going for the Patman bill or whether we are going we should start with one or the other of them right now. the full length of inflation. Mr. MICHENER. I have a. great many farmers in my Mr. BOILEAU. I understand the gentleman's point quite district, as the gentleman has. Does the gentleman think it well, and let me reply in this manner: Every infiationist I would be better first to pass the Lemke bill to take care of know of favors the Frazier-Lemke bill, the bonus, and these the fanners or to pass the Patman bill first? other bills in principle, but no one that I know of would advo­ Mr. BOILEAU. I wish to say to the gentleman that since cate the enactment of all these bills at the same time. No I have been a Member of the Congress I have been one of one advocates and no one has advocated the enactment of the exponents of the Frazier-Lemke bill I want to say to bills that would give the greatest pos.sible amount of expan­ you here now that if I had my choice today to enact any sion of the currency. The proponents of the Frazier-Lemke one piece of legislation which I thought would do the great­ bill, in saying that about $3,000,000,000 would be su:fficient to est amount of good for all the people, I would cast my vote use as a revolving fund, mean that we should stop at that for the Frazier-Lemke bill I believe it to be economically point if commodity prices get to the 1926 level; and then I sound in principle, I believe it to be workable and helpful to may say to the gentleman that if we passed that measure every man, woman, and child in this country. However, I first, and that had the desired effect, then I would be willing may say that I am not willing to carry all my eggs in one to accept the Vmson plan, rather than the Patman plan, but basket. I am going to keep on working for inflation just as I we have not passed the Frazier-Lemke bill yet, and with the have at every session for the last 4 years, because I believe temper of this House as I have seen it during the past 4 years we are not going to get out of the depression until we expand I am not so sure that we can pass the Frazier-Lemke bill so our currency materially; and if the gentleman from Mich­ easily. igan, or any other gentleman, has any real, sensible pro­ [Here the gavel fell.] gram of expansion-I mean one that appeals to me as being Mr. DITTER. Mr. Chairman, I yield the gentleman 5 sensible-I can assure the gentleman I shall support it and additional minutes. do all I can to have it enacted if it appears to me to be the Mr. BOILEAU. For one, I would not want both passed at one that will first receive consideration. the same time. If one of them were passed, then I would However, I want to leave this statement with the Mem­ accept, so far as I am concerned, a compromise in the matter bership of the House. I believe in expansion of the cur­ and provide that the other money be made available in some rency. I am going to keep on fighting for it to the utmost other method, at least until we had an opportunity to observe of my ability, and I want to say to the gentleman from the results of the enactment of the first bill passed. Michigan that it is going to be a sorry day for this country Mr. MICHENER. The gentleman is reaching the very unless we wake up in the near future and have the Con­ point in which I am interested. It is practically impossible gress of the United states have something to say about our to carry out the views of the pr-oponents of the Frazier-Lemke monetary system. bill and the views of the Patman proponents and pass the Mr. KENNEY. Mr. Chainnan, will the gentleman yield? same bills at the same session of Congress. Mr. BOILEAU. I yield. Mr. BOILEAU. The gentleman is probably correct, but Mr. KENNEY. Do I understand the gentleman to say the gentleman is also much more of an optimist than I am that under the Patman plan the veteran himself, about if he feels that Co:ragress is going to pass them both one whom we are concerned in the payment of the bonus, will after the other without intervening time. I should be very receive a cheaper dollar? optimistic if I thought we could pass one early in this ses­ Mr. BOILEAU~ No; not a cheaper dollar than anybody sion and then pass the other one later during the session. else gets. Mr. MICHENER. There are a great many people in this Mr. KENNEY. Does the gentleman-- body 1n favor of the so-called" Townsend plan." Would the Mr. BOILEAU. Just a moment. I do not want to accept gentleman favor the Townsend plan to the exclusion of a wrong premise 1n this argum~nt. The gentleman made either or both of the other measures? the statement," the veteran, about whom we are chiefly con­ Mr. BOILEAU. Let me say to the gentleman from Mich­ cerned." That is not my position. I believe this is a mat­ igan that unless the bonus bill is passed or unless the Fra­ ter in which every citizen of the country is concerned. It zier-Lemke bill is passed or unless some other inflationary is not only a veterans' problem but it 1s one of national measure is passed, and passed soon, you a.re going to see a economics and one in which the entire Nation is interested.. much greater demand for the Townsend bill than that which Mr. KENNEY. That is, the :inflationary part? now exists. I am very frank to say to the gentleman that Mr. BOILEAU. Both parts of it. I believe the Townsend plan to be the most inflationary [Here the gavel fell.] measure yet suggested.. I doubt very much tf ft would be Mr. DITTER. Mr. Chairman. I yield the gentleman 5 possible to enact the Townsend plan with its sales-tax pro­ additional minutes. vision and retain any of our present conceptions of eco­ Mr. KENNEY. Under the Vmson plan would not the nomics. I do, however, favor a liberal and adequate old-age veterans get a greater value than under the Patman bill? pension system. I should like to say to the gentleman that Mr. BOILEAU. Yes; at the expense of every other person I believe, however, unless some inflationary measure is en­ in this country. acted. you are going to have to go as far as the Townsend Mr. KENNEY. Does it not occur to the gentleman that plan. You are going to have to give some ln.fiation to the in connection with the bonus legislation we might pass the country so that the people will have a fair chance to at least Vinson bill without any burden on the taxpayer whatever, eke out an existence. and at the .same time not ~ve rise to any fear of inflation, 620 CONGRESSIONAL- RECORD-HOUSE JANUARY 17 provided we passed a revenue-raising-measure at the -same In New Jersey the Corporation has closed as of the same time which would not resort to or burden the taxpayer, and date 29,824 loans, involving $145,714,727. There are in the we could do that through my proposed national lottery? legal department being closed an additional 6,585 loans, Mr. BOILEAU. I thought the gentleman would come which would make a total of 36,409 closed under the present around to the lottery. [Laughter.] I know the gentleman appropriation. The ones actually closed as of January 3 is a serious sponsor for that proposition, but I do not think represent 50.3 percent of the -net applications. I can support a lottery. There has been considerable criticism in Congress of the Mr. KEmTEY. Does the gentleman know of any other administrative officers of the Home Owners' Loan Corpora­ plan better or equally as good that would raise money with­ tion. There may have been errors of omission and com­ out being a great burden on the taxpayer? mission in the administration of the act, but it is also true Mr. BOILEAU. I am sorry if I have not been able to make that the program has accomplished a great deal of good. my views plain on expansion of the currency. It would not We cannot hope to make legislation effective without the be a burden on the taxpayer, but it would be of benefit to faith and confidence of the people. Ridicule and caustic each and every one of them; only some of them do not want criticism by those who enact the laws do not conduce to that to lose the unfair advantage they have because of our silly faith and confidence. It behooves us, therefore, to extol its monetary system. Now, I do not care to discuss the lottery virtues and correct its shortcomings, and with the knowl­ proposition. The gentleman made reference to the fear of edge that has come to us from the experiences of the past 2 inflation. I am not one of those who is fearful of inflation, years, meet the situation and complete the job by granting because it can be controlled by a sensible Congress. I be­ the home owners the relief it was intended they should have. lieve there are men in this House who believe in moderate Operations of the Home Owners, Loan Corporation were expansion who would cooperate with the conservative men suspended on November 16, 1934. Congress has been in ses­ in the House to prevent undue expansion. sion since January 3. If I judge the sentiment of the House Mr. WHITE. Will the gentleman yield? correctly, there is sufficient support for an additional ap­ Mr. BOILEAU. I yield. propriation and for such action as may be necessary to Mr. WHITE. I should like to ask the gentleman from grant this relief, and Members are waiting for an oppor­ New Jersey if the money to support this lottery comes out tunity to support the necessary legislation for that purpose. of those who are able to support it? But there is no indication of anything being done. When Mr. BOILEAU. I will let the gentleman from New Jersey the legislation was being considered by the House, the Chair­ answer that question. man of the Committee on Banking and Insurance very frankly said it was not the hope or idea of the proponents of Mr. KENNEY. It comes by voluntary contribution of the the legislation that it would be a complete solution for all people. It is a voluntary tax. It is not a compulsory tax. the difficulties confronting the home owners, that it was ex· If a man does not want to participate in it, he need not do perimental in its nature, and it was the hope it would grant so. I believe that we ought to go to the country to raise some relief and blaze the way to a solution of these difficul­ this money from people who are willing to contribute small ties. Whether or not it is wise within the purview of con­ amounts to support various worthy causes, as they did in stitutional limitations, or economically sound, for the Gov­ the Revolutionary War and thereafter and as they are now ernment to enter into this activity is doubtful, but we have doing in supporting foreign hospitals, foreign veterans, and been constrained to overlook these considerations because other for.eign causes through participation in lotteries of of the emergencies which exist, and also for the reason that other countries. this was one of the emergency-relief measures which is Mr. WHITE. The losses through gambling at race tracks self-liquidating, and which provides reasonable certainty for would be a similar contribution. the Government to get back a considerable portion of the Mr. KENNEY. Oh, no; that is an entirely different prin­ money which it invests and will enable it to retire from this ciple. The proceeds go into different channels entirely. sort of activity in that great day we all hope for when con­ Mr. BOILEAU. Mr. Chairman, I want to conclude my ditions shall have righted themselves. statement and make it well understood that I am not advo­ For these reasons I was glad to support the legislation cating a lottery as a means of paying the bonus. The Vin­ as a part of the recovery program, and I have watched its son bill is bad enough. When it comes to expansion of the course with considerable interest. I lent my cooperation to currency, there is no gambling about it. If gentlemen will every agency in my district, in public addresses, and in pri­ study the provisions of the Patman bill, they will find it vate conversation to bring about its successful operation, provides for a controlled expansion of the currency, and in and this, notwithstanding that I was not asked to recom-:­ my opinion there is no one thing that would be of as much mend a single individual as an appraiser or as an attorney, benefit to the country as to expand the currency moderately and that the entire organization in my State bears every as provided in the Patman bill. And I say as much for the indication of the fact that one who sought employment Frazier-Lemke bill, so that I would not be charged with with the corporation, as a condition precedent to his quali­ deserting my first love, because I do advocate the Frazier­ fications, needed to be affiliated with the political activities Lemke bill as a bill to give much-needed relief to agriculture. of the party in power. [Applause.] It may be true, as is charged, that many applications Mr. DITTER. Mr. Chairman, I yield 10 minutes to the failed of proper consideration because of the inefficiency of gentleman from New Jersey [Mr. McLEAN]. the administrative officers. It may be true that favoritism Mr. McLEAN. Mr. Chairman, it is my purpose to direct was shown in some instances, and it may be true, . and attention to the necessity of some immediate action by Con­ doubtless is, that many persons obtained loans who were not gress for the relief of the home owners. The situation be­ in difficulties, whose properties did not need refinancing, and · came tragic in November when it was announced that no who could have solved their problems in other ways. All further applications for home loans would be received and these shortcomings might readily be the natural and prob­ that no application had a chance for favorable considera­ able consequences of the haste with which the organization tion unless it had reached the closing department. Unless was set up and the inexperience of the administrative of­ some attention is given to this situation and some provision ficers. Newness and haste always create evils of one kind made to accomplish and complete the real purpose of the or another. Also, in the discharge of their duties the ad­ home owners' loan II}ovement, a complete break-down of this ministrative officers met many situations, and the necessary phase of the recovery program must be admitted. resistance on their part in improper and unworthy cases As of January 3, the Corporation has closed a total of naturally caused resentment and adverse comment. How­ 733,140 loans, in the amount of $2,219,011,290. There are in ever, the way to solve this difficult problem is not by adding the closing department a total of 188,696, thus making a to this criticism and the lack of confidence which it will total of 921,836 loans which will have been closed with the inevitably create by yapping about conditions, but it is for money previously appropriated by Congress for that purpose. the responsible parties to undertake the study of the exi· 1935 CONGRESSIONAL RECORD-HOUSE 621 gencies, and the situation of home owners as it exists today LEAVE OF ABSENCE and to find a solution for it, and in this instance the respon­ By unanimous consent, leave of absence was granted as sibility lies with the Congress of the United States, and follows: should have immediate attention. To Mr. McDuFFIE, indefinitely, on account of illness in Knowing of the charges and attacks that are being made family. and the necessitous conditions confronting thousands of To Mr. DuNN of Mississippi, for 4 days, on account of im­ home owners, it should be the obligation of the Committee portant business. to immediately undertake an investigation into the matter RIVERS AND HARBORS OF SOUTHWEST WASHINGTON AND THE NA­ and determine upon the procedure and future policy of the TIONAL HARBORS AND FLOOD CONTROL PROGRAM Government. Mr. SMITH of Washington. Mr. Speaker, I ask unanimous Encouraged by the hope held out to them 2 years ago, consent to extend my remarks in the RECORD and to insert many home owners have been anticipating favorable action, therein an address which I delivered before the Northwest and people who have their money invested in mortgages Rivers and Harbors Congress at Seattle, Wash. have been awaiting action by the Government. Meanwhile, The SPEAKER. Is there objection? interest on mortgages, municipal taxes, and Government There was no objection. charges against the property, insurance premiums, and the Mr. SMITH of Washington. Mr. Speaker, under leave to cost of necessary repairs have been accruing, further jeop­ extend my remarks in the RECORD, I insert an address deliv­ ardizing investments and making it more difficult for home ered by me before the Northwest Rivers and Harbors Congress owners to solve their problems. This experiment, which was at Seattle, Wash., on October 12, 1934. one of many calculated to bring about economic recovery, The address is as follows: has taught us many valuable lessons from which it should Mr. President, members of the Northwest Rivers and Harbors be possible for Congress to overcome many shortcomings. Congress. ladies and gentlemen, I appreciate Mr. Wilson's kind The administrative omcers have learned the same lessons words of introduction and I am glad that he is a little more chari­ many table than the chairman on a certain occasion who was introduc­ and, in instances, have used their knowledge to the ing a Member of Congress and said," We have had a very profitable end that the appropriation made by Congress and the bonds ~on and we are all enjoying ourselves. Shall we continue to issued may be placed in channels where it was really do so, or shall I now call upon the Congressman to deliver his intended they should go. address?,. I am very happy to be here today and to have the opportunity There is no doubt that mortgage companies, building and of discussing with you matters in which I know you are all loan associations, and banks and individuals haove bene­ vitally interested, and which are also very close to my heart. I fited by an exchange of bonds for mortgages, and many claim the unique distinction as a Member of Congress of repre­ senting more rivers and harbors and waterways and larger bodies municipalities have been relieved by the payment of taxes of water than any other single Member of the United States Con­ brought about through the payments which have been made gress; and when I went back to the National Capital and sought through the refinancing of homes under the act. membership on the Rivers and Harbors Committee I made that assertion and made it repeatedly and defied any other Member to We hear much of the effort to force private money out successfully contradict tt. In southwest Washington we have six of hiding into investments. In my judgment none of the very important harbors-Grays Harbor, Wille.pa. Harbor, Longview, other efforts to induce investment in real-estate mortgages Vancouver, Olympia, and Bakers Bay. We have two important will be as effective as the system provided under the Home seaports-Longview and Vancouver--on the Columbia River, which is the tenth largest river in the world. Olympia is on Puget Owners' Loan Act. The bonds are finding a ready market, Sound, which is one of the largest inland bodies of water in the and the relief from anxiety of the home owner is a reas­ world. In addition to that I claim, and I believe, truthfully, that surance, and he has undertaken the task of meeting the the Pacific Ocean, which is the largest ocean in the world, is in my district because Pacific Beach is in my district. In addressing vicissitudes of life, even under existing conditions, with the National Rivers and Harbors Congress in Chicago, I told them greater hope, greater faith, and greater confidence. of the great honor and pleasure I had a number of years ago of I have saiid that the situation now existing among the being introduced to Mary Pickford, "America's sweetheart." I asked her if she had ever been in the State of Washington and she said home owners is tragic. Hope deferred has resulted in dis­ she had spent some delightful hours in Seattle. I told her, "Well, couragement and disaster. It is the obligation of Congress you should by all means come down to Pacific Beach and visit our to hear this cry for action and to make the object of its ocean down there. We are very proud of it. It is the largest immediate attention that vast concourse of Americans who ocean in the world." She smiled and said, "But isn't it the same one we have down here in California?" I had to admit that have their all invested in their homes. I strongly urge that it Wll.8. instead of indulging in ironical sarcasm and personal in­ PROGRESS DURING PAST 2 YEARS vectives and criticism of public omcials, which can have no I think that there has been more development and more progress other purpose than to hamper the work of the agencies of made in regard to rivers and harbors of the Northwest in the past 2 years than has been the case for a long time, and I believe that the Go~rnment and destroy the faith and confidence of a great deal of the credit is due to your organization. I noted the the public in governmental agencies, we should look to a tact that Mr. Wilson, in making his report, referred to your spon­ solution which the public has a right to expect. OUr duty sorship by resolution of a number of very important projects is finish the which have since materialized and been carried out. I was just plain. We should either go forward and job cheeking over the other day the number of items and transactions of granting relief to home owners, either by the method relating to the rivers and harbors of southwest Washington that provided by the Home Owne~ Loan Act, or some substitute came before the Rivers and Harbors Committee for action during therefor; or else we should stop encouraging those who the first and second sessions of the Seventy-third Congress, and I found that there are 20 items relating to hearings, reports adopted, have been led to believe that their Government was coming resolutions that were passed, and other items of business relating to their aid, and make it known that the efrort to aid home to the rivers and harbors of southwest Washington. owners has been abandoned so that they will not continue G&AYSHARBORJETl'YP&OJ:EC1' to dwell on false hopes and will face the inevitable. - Down on Grays Harbor we have succeeded 1n having transferred Mr. CANNON of Missouri. Mr. Chairman, I ask the to the Federal Government the cost of maintaining the inner channel of Grays Harbor, which has been borne by the local tax­ Clerk to read the bill. payers for 15 years, since 1919. I believe you mentioned in your The Clerk read the bill down to and including line 15, report the Grays Harbor jetty. Since 1915, during the past 19 page 30. years, there has been no money appropriated 1n Congress for the Grays Harbor jetties, and during that period a program of dredg­ Mr. CANNON of Missouri. Mr. Chairman, I move that ing has been carried on. As a result, the jetties have become very the Committee do now rise. badly in need of reconstruction. In fact, that condition has ex­ The motion was agreed to. ist.ed for the past 10 or 12 years. in regard to one of the jetties particularly, despite the efforts of our port commission and the Accordingly the Committee rose; and the Speaker having port manager, Mr. W. J. Murphy, whom I want to say I consider as resumed the chair, Mr. GREENWOOD, Chairman of the Com­ a very capable and competent gentleman in that position. He has mittee of the Whole House on the state of the Union, reported been very aggressive, as has the port commission, and repeated that that Conup.ittee had had under consideration the bill efforts have been made to get the United States Board of Army Engineers to reverse its former adverse reports against recon· H. R. 3973, the District of Columbia appropriation bill, and structing the Grays Harbor jetties. In September 1933 I intro­ had come to no resolution thereon. d.uced a resolution. after having had numerous conferences with 622 CONGRESSIONAL RECORD-HOUSE JANUARY 17 members of the Board and the Chief of the United States Army development of rivers and harbors. I understand it is contem­ Engineers, for a review of the former adverse reports. The resolu­ plated to create 5 local boards slmllar to the Tennessee Valley tion was duly passed by the Rivers and Harbors Committee of the Authority-1 for the Pacific coast, 1 for the Atlantic coast. 1 for House, and in due time a review was made of the prior reports. the Gulf waterways, 1 board for the western tributaries, and 1 Gen. George B. Pillsbury, first assistant to Maj. Gen. Edward M. board for the western tributaries of the Mississippi River. This Markham, came out here first, and at the time when he was in­ matter will come before Congress 1n January. based 1.U)on reports the specting the Wlllapa Harbor project he also investigated the engineers have been preparing. The report on the Columbia River condition of the jetties. . is very voluminous and was Just completed by Army Engineers last He went back to Washington and reported to the Board, and fall. I hope and I think it will be my position. as a member of the Board came out and the entire personnel made a personal the Rivers and Harbors Committee. if I serve in the next Congress, inspection and finally they reviewed all the evidence and the prior that regardless of what set-up may be created that the jurisdiction reports and rendered a decision recommending the project to and the supervision of all of this work be left in the hands of the reconstruct the north and south jetties of Grays Harbor to an United States Army Engineers. My friends, I have been interested elevation of 16 feet at a cost of $4,565,000, which would give us as in rivers and harbors for many years, long before I ever aspired to safe and fine a harbor as there is anywhere in the United States, a seat in Congress, and I have read many reports of the Army probably. That project is now pending before the Public Works Engineers, and I am more or less familiar with their work, and I Administration for allocation of funds, and I will bring it before think that their record for etnciency and for devotion to duty and the Rivers and Harbors Committee for adoption in the next integrity 1s hardly equaled, and certainly not surpassed, by any Congress. body of men who serve the Federal Government. Wll.LAPA HARBOR AND VANCOUVER PROJECTs--OLYMPIA-BAKER'S BAY FLOOD CONTROL IS VERY IMPORTANT PROJECTS The matter of fiood control is very important. For the past 30 The project to dredge Willapa Harbor to a depth of 26 feet years we have had fioods recurrently in this State every 2 or S was initiated and $80,000 of P. W. A. funds allocated for that years, some of them very disastrous. I recall particularly the fiood purpose. In addition to that, we initiated the project to straighten which wiped out the old bridge between Kelso and Longview and the Narrows in the bend of the Wlllapa River, a very sharp S-turn did so much damage in 1923. The late Senator Wesley L. Jones in that river, which is a menace to navigation. That project w1ll was in Congress then and he had a great deal of influence in the cost $207,000. It was favored by the district and division engi­ Capital. He made every effort at that time to enlist the coopera­ neers, was rejected by the United States Board ·of Army Engi­ tion of the Federal Government and to get it to recognize that we neers, but was finally approved by General Markham, and the had a fiood-control problem in this State. but failed to do so. project is now pending before the Public Works Administration Down on Grays Harbor the most severe fioods of record occurred in for funds. We obtained the necessary funds to carry out the November 1909. Other fioods came ln December 1891, 1892, 1897, Vancouver project to deepen the channel to a depth of 28 feet, 1903; March 21, 1908; January 1914; December 21, 1915; 1919; and but no sooner had that been done than lt was found necessary January 1923; in other words, fioods have occurred at the rate of to continue to a depth of 30 feet on account of the contemplated one every 4 years. The fiood o! 1897 cut a channel through a farm construction of a 2,000,000-bushel grain elevator which Colonel between Oakville and Porter and made travel by road difficult for Robins and I had the dellghtful pleasure of helping to dedicate almost 2 months. The flood of November 1909 washed out a this summer. I want to just mention a llttle amusing experi­ 90-foot section of .the right-of-way of the Northern Pacific Rail­ ence when I was presenting the original project before the Rivers road between Montesano and Cosmopolis and submerged the rans and Harbors Committee of the House. We had a great many in other places by 2 Yi feet. projects up that morning and I was speaking hurriedly, and, The Federal Government has taken the position that as tar as through a slip of the tongue, in referring to the grain terminal, our flood-control problem in this State was concerned, lt was a I inadvertently described it several times as a 2,000,000-ton grain local problem for local communities. The Federal Government re­ elevator. I noticed the chairman of the committee had a very fused to render any aid. Last December, when we had the fiood, peculiar expression on his face. He interrupted me and said, it was the first time we ever succeeded in obtaining any financial " Congressman SMITH, that certainly is a remarkable project. aid from the Federal Government, and it was important, of course, What was the name of that town? " "Why, Vancouver, Wash., because it resulted in a lot of repair work being done that was at the head of the Columbia River", I answered. "Well," he valuable and gave employment. But, in my opinion, it was more said, " that certainly is a gigantic project, 2,000,000 tons. I important because of the precedent it established. For the first don't believe we have very many that size in the United States." time the Federal Government has recognized that we have a I realized what had occurred and told him I should have said fiood-control problem in this State as well as along the Mississippi 2,000,000 bushels. I was certainly impressing the committee with River and the Sacramento River. As a result, we were able to the importance and magnitude of my project. The modified proj­ secure the passage through Congress of bills for prel1.m1nary sur­ ect of 30 feet was approved by the engineers and is now before veys of the main rivers and their tributaries in the States of the Public Works Administration and will be brought before Washington and Oregon. I introduced a bill relating to the the Rivers and Harbors Committee for adoption when Congress Columbia River, which was amended to include Oregon. That convenes. survey is now being conducted. Similar bills were passed, favored We have carried out a new project at Bakers Bay, to create a by the Flood Control Committee of the House, signed by the 10-foot channel at a total cost of $80,000. We deepened the Olym­ President, and became the law of the land, for preliminary exam­ pia Channel to a depth of 30 feet, and after that project was ap­ inations of the Lewis, Cowlitz, and Chehalis Rivers, which will proved they found they did not have the funds for a turning basin, soon be made. These are the first bills for preliminary examina­ so we went back and got another resolution adopted and succeeded tions 1n regard to fiood control that have ever been passed by the in getting the committee to authorize the additional funds, a total United States Congress atrecting the rivers in the State of Wash­ of $92.000, for carrying out the original project and providing the ington and in the State of Oregon; so, I feel, my friends, that we turning basin. We did not secure quite sutncient funds at Bakers are making real progress. Now we are in the picture, and when Bay. We r.an short of funds and had to go back and get an this national program is carried out, which it will be in the very additional amount to complete the project down there, which we near future, as that legislation will come before Congress early in the next session, it is going to result 1n our obtaining protec­ succeeded 1n obtaining. tive measures in those States against floods in the !Uture and HARBOR DREDGING IN SOUTHWEST WASHINGTON ~a.inst soil erosion. However, we cannot expect the Federal Gov­ For the first time in a long while we have the continuous opera­ ernment to assume the entire cost, as it has not done that along tion of Government dredges in every seaport in southwestern the Mississippi or Sacramento Rivers; but I think we will find in Washington-Grays Harbor, Willapa Harbor, Longview, Bakers Bay, many communities that by constructing the dikes, by construct­ Olympia, and Vancouver. Dredging work has been done on the ing tide boxes, by building roads and bridges, and making other Washington ship canal. There has been work done at Tacoma Har­ improvements, we have already made a valuable contribution, and bor and this work that we mentioned at Bellingham. We certainly the Federal Government will more than match our expenditures. ought to appreciate, and I think we do, the cooperation and the We are only beginning to recognize the truth of Theodore Roose­ consideration we have received from Secretary Ickes and the Public velt's prophecy of 30 years ago 1n regard to the need for fiood Works Administration and the splendid cooperation we have had control in this country. We have had these d!sastrous fioods all from the United States Board of Army Engineers, and particularly over the country. from Gen. Edward M. Markham. who has proved that he is very I happened to be in the otnce of Mr. Hopkins-Federal Emer­ friendly to all the waterways of the Pacific Northwest. I believe he gency Relief Administrator-when he received a long-distance call is a true friend of our section of the country and realizes the im­ from New York in regard to the fioods up there. He had promised portance of our seaports out here. I consider that we are very for­ to help us out here and he turned the people of New York down tunate indeed that the new north Pacific division otnce of the because funds were not available. We have been treated very gen­ United States Board of Army Engineers has been established at erously out in this section of the country in many ways, as witness Portland and has jurisdiction over all the harbors in our section of the two great projects, the Bonneville prolect and the Grand the country. That is going to be a decided advantage to us. I Coulee project, to develop electrical power and for the reclamation make the same statement in regard to Col. T. M. Robins, who has of arid lands. I said that we have come into the picture. We been very considerate, more than fair, and I believe he 1s our have. We are receiving more attention from the Federal Govern­ friend, and I am sure we all appreciate it. ment than has ever been true in the past. We can visualize a NEW NATIONAL WATERWAYS PROGRAM great industrial expansion in this part of the country. It is very essential that we be prepared by developing our rivers and harbors There is going to be a new national waterways program. You to protect the commerce that is going to enter and depart from have read· the message that President I«>osevelt sent to Congress the harbors of the State of Washington. relating to that subject. It 1s going to be very comprehensive and embraces a great many features, among them fiood control, OMNIBUS RIVER-AND-HARBOR BILL river and harbor development, reforestation, and other national Speaking as a member of the Rivers and Harbors Committee, I undertakings. We are more interested in the fiood control and feel that I can honorably assure you that there will be a rivers 1935 CONGRESSIONAL RECORD-HOUSE and harbors bm reported out by the Rivers and Harbors Com­ The Clerk read as follows: mittee of the House and introduced in the next session of Con­ gress and that it will be reported out and brought out on the Resolved, That for the purpose of obtaining information neces­ fioor of both of those bodies and will be enacted into law. We sary as a basis for legislation the Committee on Military Affairs haven't had a river-and-harbor bill, I think, for 5 years. I don't of the Seventy-fourth congress is authorized, as a committee, by believe there was a bill during the former administration, but we subcommittee or otherwise, to continue the investigation begun have the assurance of the present ad.ministration, of President under authority of House Resolution 275 of the Seventy-third Con­ Roosevelt himself, who has already proven his friendliness to- rtver­ gress, and for such purposes said committee shall have the same and-harbor improvements, that he is friendly to such a bill being power and authority as that conferred upon the Committee on introduced and passed during the next session o! Congress. Military Atfairs by House Resolution 275 of the Seventy-third Con­ In conclusion, I want to acknowledge on this occasion my indebt­ gress. The unexpended balance of the appropriation of $30,000 edness to all the port managers in my district and throughout the under House Resolution 284 and House Resolution 439 of the State and to members of various port commissions for the splendid Seventy-third Congress is hereby continued for such purposes. cooperation I have received from them and the magntllcent way in The SPEAKER. Is there objection to the immediate con­ which they have presented their projects, because we all realize no Congressman can get very far unless you gentlemen give him the sideration of the resolution? material with which to work. You have to furnish us with the evi­ Mr. MARTIN of Massachusetts. Reserving the right to dence and with the testimony, you might say, and then we have to object, I should like to ask the gentleman from South Caro­ conduct the case to the best of our ability. I also wish to pay a tribute to the district and division engineers, to Colonel Sturdevant, lina [Mr. McSwAINJ if this is a m;ianimous report from the of Seattle, and Major Williams, of Portland, and, o! course, as I Committee on Military Affairs? have mentioned, to Colonel Robins, who is our true friend, although Mr. McSWAIN. It is. It is not only the unanimous rec­ I don't believe he would allow his friendship to gway his judgment ommendation of the Committee on Military Affairs but I any more than I would, were you to present a project which I thought was fantastic and had no merit. I wouldn't sponsor it, presented the resolution to the Chairman of the Rules Com­ because 1f a man did that he would lose his 1.nfluence with the mittee, which would normally have jurisdiction, and he ·said Rivers and Harbors Committee, as every time I appear before the he would have no objection, and could conceive of no objec­ committee I want to be fortified by facts and evidence, so that I can persuade them that the project is meritorious. That is where tion, in view of the work of the committee and its great ad­ you gentlemen come 1n, 1n cooperating with port managers and dis­ vantage to the country. I presented the resolution also to trict engineers in assembling facts and presenting the case. the minority leader, Mr. SNELL, this morning, and he had no I have a great deal o! faith in the future of this part ot the coun­ try. I think we are a.bout to witness an awakening in the Orient; objection. He said he wished to ask me a question, and I that the many millions over there are about to become modernized shall be glad to give the gentleman the information which the so that they will present the richest market tor the sale o! our minority leader said he wished to elicit. products that the world has ever seen. Civilization has been mov­ Mr. MARTIN of Massachusetts. Could we not let this go ing westward ever since the dawn of creation. We are now about to witness the commercial supremacy of the Pacific coast, and I do over until tomorrow? The minority leader is temporarily out not believe that any master of language could pa.int a word picture of the Chamber attending a meeting. I suggest that the gen­ that would be too rosy so tar as the future of the States of Wash­ tleman let this go over until tomorrow morning. ington and Oregon and all our seaports and all our cities in this section of the United states are concerned.. We are on the eve of Mr. McSWAIN. I should be glad to have it considered to­ the greatest era o! development that the wol"ld has ever witnessed night. The minority leader said he wished the RECORD to I thank you for your kind attention. show how much of the appropriation had been expended and ORDER OF BUSINESS whether or not there would be any further appropriation Mr. :MARTIN of Massachusetts. Mr. Speaker, will the gen­ requested. tleman from Colorado [Mr. TAYLOR] kindly inform us what Mr. MARTIN of Massachusetts. Mr. Speaker, I think I the program is for tomorrow after the completion of the will have to object to the consideration of this resolution at pending bill? this time. Mr. McSWA.IN. I will his Mr. TAYLOR of Colorado. I do not know of a thing for hope the gentleman withdraw tomorrow after that time; and in this connection I may say objection. that I hope we can, by unanimous consent, adjourn over on Mr. BLANTON. Will the gentleman yield? Fridays for some little time. All of the Members are deluged Mr. McSW A.IN. I yield. with office and departmental work. and I feel that we can Mr. BLANTON. The gentleman from Massachusetts [Mr. get better service if we shall adjourn over from Fridays to MARTIN] knows of the splendid work which this subcommit­ Mondays. tee did not only in the last Congress but all through vacation and, so far, in the present Congress. I understand the mi­ STATUES OF CAESAR RODNEY AND JOHN IL CLAYTON nority leader has agreed to this resolution. Why not let it Mr. STEWART. Mr. Speaker, I ask unanimous consent go through? for the present consideration of Senate Concurrent Resolu­ Mr. MARTIN of Massachusetts. The minority leader said tion No. 4, which I send to the desk and ask to have read. he would like to ask a question, and he is not here to ask I might state that I have conferred with the gentleman from that question. Illinois [Mr. KELLER], the Chairman of the Library Com­ Mr. BLANTON. The only question be would ask would be mittee, and it is my understanding that he is agreeable to whether or not it was going to require more money. the consideration of this matter in this manner. Mr. MARTIN of Massachusetts. Well, I do not know that. The SPEAKER. The Clerk will report the resolution. Nothing is going to be lost by letting it go over until tomorrow The Clerk read as follows: morning. Senate Concurrent Resolution 4 Mr. BLANTON. But you will require the gentleman from .Resolved by the Senate (the House of .Representatives concur­ South Carolina [Mr. McSw AIN l to be here in the morning, ring), That the statues of Caesar Rodney and John M. Clayton, and he is very busy and is needed elsewhere. presented by the State of Delaware and placed 1n Statuary Hall, Mr. MARTIN of Massachusetts. The gentleman from are accepted in the name of the United States, and that the thanks of Congress be tendered the State for the contribution South Carolina is always here, so that will be no hardship. of the statues of two of its most eminent citizens whose names are Mr. BLANTON. But the gentleman is doing some most so thoroughly identified with the State and Nation. important work that requires his time somewhere else. Resolved f'ILrl:her, That a copy of these resolutions, suitably Mr. MARTIN of Massachusetts. I appreciate that, but I engrossed and duly authenticated.· be transmitted to the Governor of Delaware. do not think there will be any hardship in letting this go over tmtil tomorrow. The SPEAKER. Is there objection? Mr. McSWAIN. May it come up the first thing in the There was no objection. morning, so that I will not have to remain on the floor? The resolution was agreed to; and a motion to reconsider Mr. MARTIN of Massachusetts. Certainly, so far as we the vote by which the resolution was agreed to was laid on are concerned. the table. Mr. BLANTON. I understand that the gentleman from AIRPLANFS New York [Mr. SNELL] expressed himself as being perfectly Mr. McSWAIN. Mr. Speaker, I ask unanimous consent agreeable to the resolution. for the present consideration of a resolution which I send to Mr. McSWAIN. Mr. Speaker, I will withdraw my request the desk and ask to have read. at this time. 624 CONGRESSIONAL RECORD-HOUSE JANUARY 17

The SPEAKER. The gentleman ·from South· Carolina' · GEORGE H. EAJU.E IS ·EMERGING AS A NATIONAL FIGURE . withdraws his request temporarur. Mr. Speaker, I ask you and the Members of the Congress to keep before you the name of George H. Earle, and to mark LEA VE OF ABSENCE what he will do. He has already served his country well as Mr. DUNN of Pennsylvania. Mr. Speaker, I rise to ask a its Minister to Austria, although in that capacity he was too question. I understood that Mr. DUNN asked unanimous far removed from the daily stage of our national activities consent to be absent for 4 days. Is that the gentleman to receive well-deserved attention. But as the Governor of from Mississippi [Mr. DUNN l ? the Keystone State of the Union, George H. Earle is emerging The SPEAKER. The Chair is informed that it was the as a new figure on the national scene. Let him but have the gentleman from Mississippi [Mr. DUNN] who made the strength to realize these high aims and George H. Earle request. - will emerge one of the great men of these trying times. AN EMANCIPATION PROGRAM FOR PENNSYLVANIA And now let me read to you the inaugural address of Mr. ELLENBOGEN. Mr. Speaker, I ask unanimous con­ Gov. George H. Earle. sent to extend my own remarks in the RECORD and include In this oath I have pledged myself to serve the people of Penn­ sylvania as best I can. These are desperately trying times, bitter therein the inaugural ~ddress of the Governor of Penn­ times. You are asking, "Where are we going? Where do you sylvania. want to lead us? " The SPEAKER. Is there objection to the request of the Solemnly, with the echo of the oath still upon us, I answer that we are going, along with the rest of this Nation, to new ground. gentleman from Pennsylvania [Mr. ELLENBOGEN]? Politically and economically a change 1s necessary. The misery of There was no objection. millions, the insecurity of all, bids us vacate the too easy tolerance Mr. ELLENBOGEN. Mr. Speaker, I am happy to present into which we were lulled during the past decade. America, in its pioneer days, was hardy and barefooted, shlrt­ to the Congress and to the people of the United States a sleeved, sharp-eyed. America was then ready for whatever truly great human document-an emancipation proclama­ came, always striving for a better pasture over the hlll. We're tion for Pennsylvania-the inaugural address of the Honor­ going back to that spirit today. Not literally, not seeking new able George H. Earle, who was inducted into office as land, but seeking into the future for the security and freedom that makes all land. all property, all life worth while. Governor of the Commonwealth of Pennsylvania last Tues­ America 1s going pioneering across the mountains of special day, January 15, 1935. privilege and predatory wealth that fancies itself securely founded. I Pennsylvania, 1n my administration, 1s going with America. The want to present this address to my colleagues, not be­ farther we are toward the fore, the better. cause Governor Earle and myself share the same political Every now and then history sits down and rests. The short­ faith, and not because he has become the chief executive of sighted say, "Now the last frontier 1s closed. Now change 1s Pennsylvania, the State which I have the honor to represent ended." But the last frontier 1s never closed. This summons cannot be ignored or evaded with impunity. in tlle House of Representatives. I do it because I sincerely believe this address to be the clearest and best expression WARNS OP DISINTEGRATION The punishment of history has descended again and a.gain on of the purpose and objectives of the new deal that has those who closed their eyes to the summons. Disintegration, yet been presented. decay, extinction, are the inevitable fate of a nation which refuses to change when the times demand change. The jungle creeps GOVERNOR EARLE'S DEFINITION OF "A DEMOCRATIC FORM OF back upon the untended clearing, the sea finds a way through the GOVERNMENT " . once adequate dike. When the old enemy is stamped out, a. way Although Governor Earle has here specifically laid down a must be found to defeat the new. We can no more shirk our pioneering task than the men who plan of action to be undertaken for the betterment of my first landed on these shores could turn their backs to the wilder­ own State-and one which is worthy ot emulation by all ness in front of them. We must plunge into and cut away the others-the underlying philosophy he expounds, and the undergrowth and build. We must explore and experiment, be exposition of the solemn obligations of a government to watchful and not content to rest, until our security 1s attained. Our ancestors fought their way forward with axes and plows. those it governs, overleaps the boundaries of a single State. Today's pioneering calls for the subtler, but no less necessary, Mr. Earle has given us here, in specific and unequivocal tools of the mind. The obstacles and dangers around us are not terms, a translation into action of that vague phrase, " a the work of external nature, but creations of our ancestors and o! ourselves. democratic form of government." Our dangers consist of institutions, practices, fulcrums o! po­ This is democracy-not a grudging admission of the litical and economic power which exist to the detriment of the rights of the unfortunates of this life to a few crumbs left people as a whole. We were building a vast technical machine 1n these last 100 from the full loaf but an eager welcome to them to partake years. We were improving the methods of agriculture, revolu­ fully of what they have so long been denied. tionizing the processes of industry. We broke through one mate­ That, to George Earle, is the essence of the new deal, rial frontier after another. But we forgot that no nation is stronger than the law and the morality that bind it together. and its great promise permeates every word of his speech. We forgot one of the oldest lessons of history-that changed The principles he espouses are principles which should guide physical conditions call for new political institutions. the Nation as well as the Commonwealth of Pennsylvania, OPPOSES HASTY CHANGES and indeed they shall. For they are :fine enough and broad I do not mean, of course, that we must try to wipe out the enough to lead us to a happier and saner perm.anent way of past by revolution or too hasty change. There are fundamental life. institutions which, I believe, will endure 1n the fields of economics and politics for thousands of years. Democracy and private prop­ GOVERNOR EARLE BLAZES A NEW TRAIL IN THE KEYSTONE STATE erty, for instan.ce, may no more be successfully replaced today than the ancient principles of the lever and the wheel have been I ask every one of my colleagues to read Governor Earle's displaced by our progress in the field of mechanics. speech and to understand it as we in Pennsylvania under­ But the right of private property does not mean to me some­ stand it. t.hing exactly and precisely defined down to the last detail and the definition graven on stone and buried somewhere 1n the Pennsylvania in the past has not been a happy State. vault.a o! antiqu1ty. Too many of its legislators have won the dubious distinc­ It means this: Individual ownership of material goods on terms tion of being errand boys for a selfish privileged few. These adapted to serve best the needs of any given community at any have exploited the powers and potentialities of that great given time. When private ownership has been a successful institu­ tion, it has meant just that. When private ownership, or any State. Mighty industries, wealth-producing mines, and fer­ other institution, has set itself against fundamental changes, it tile farm lands have been misused to build up a few tower­ has been found wanting. ThiB I believe to be the liberal position, ing fortunes and financial dynasties at the expense of its the attitude necessary for perm.anent recovery. I believe in the profit motive. I believe in private ownership. 10,000,000 citizens. We have done away with all that. We They provide the only basis for our present civilization and its are on a new trail in the Keystone Sta~. future progress. But we cannot escape the fact that today pri­ Pioneering until now only in industrial development, vate ownership means the ownership of nothing by the majority o! This is our citizens. Except th.rough charity, they have not even obtained henceforth we also lead in social engineering. the sufilcient of the product of private ownership to keep alive. Could significance of Governor Earle's speech; this is the path he any situation be more calculated to undermine faith 1n private will tread. ownership than this? · 193-5 CONGRESSIONAL RECORD-HOUSE .625 The timorous crry of mistaken self-interest quavers that the sentimental gesture. It ls as much a necessity of modern life slightest modification of the present political attitude toward as steel and electricity. It fits into the jigsaw puzzle the world _busines_s foreshadows the doom of capitalism. is trying to reconstruct from the aftermath of the industrial revo­ lution of the nineteenth century. . POINTS TO EUROPE A moment ago I spoke of the ancient security of rural com­ If the reactionaries would turn their eyes in the opposite direc­ munities. They are no longer secure. Not only does the weight of tion they would have more justifiable cause for alarm. Danger an unjust taxation and monetary fluctuation bear them down, but does lie ahead for capitalism and for democracy, unless we are they have fallen into the control of big business which has im­ ready to change many of our institutions and practices. Russia is poverished them with one hand while it exploits the consumer the proof. All Europe today is a panorama of the decay of na­ with the other. tions which will not face the necessity for sane, sensible progress. I refer in particular to certain of ·the lar.ge milk distributors From Austria I watched that disintegration with my own eyes, operating in this and other States. When I look at the recent his­ and I returned to be your candidate for Governor with the ques­ tory of these companies in their relation to the farmer and to tion in my heart, " Will my Nation be str.ong enough, intelligent the public, I am driven to one conclusion-that the men in charge enough, courageous enough to avoid that fate?" I believe the of them hope to clean up personal fortunes in a few years and get answer is "yes", but I believe the victory will take some fighting out before public indignation catches up with them. and work. It is worth it. They cannot be loo-king far ahead. After all, the human worm I want to be a part of this fight. I want to share this work. My wlll turn. And if ever there was occasion for public resentment, program was stated fully and. I hope, clearly during the campaign. these certain milk distributors have given that provocation. As I restate it now, you will not find it changed. My convictions Milk is the most vital of all necessities that can be dealt in have not altered. Rather they have strengthened as the depression commercially. The public is at the mercy of its milk supply. continues and the enemies of reform give stronger evidence that Moreover, in this part of the Nation, dairying is the backbone of they intend to block recovery. agriculture. My fundamental conviction is that life must be made more secure DENOUNCES DISTRIBUTORS for those millions who, by the accident of birth, are left at the mercy of economic forces. I see no just reason for the relative Yet these men have had the effrontery to attack the roots of present security which I personally enjoy, by the grace of chance, both our rural and urban existence. Briefly, they kept up the .while most of my fellow-citizens are never at any time separated price of milk through the depression so that fewer and fewer per­ by more than a hair from want and misery. The gulf is too wide, sons could buy enough. With the consumption of milk fallen the contrast too sharp. I have long felt in my heart that there Is below half the amount necessary for minimum healthful diet ·something basically wrong with this disparity. And with my eyes standards, they turn to the farmer and cut his income on the plea ·r have seen what is wrong during this depression. that a milk surplus exists. The benefits of all our progress have gone to a few, though it Surplus, indeed. I know where that surplus is-and so do they. was the masses that made the progress possible. The few cannot It is in the fat salaries that these men who dominate the Milk go farther without the many. The few who enjoy wealth are Trust receive. It is in the watered stock of some of these compa­ chained, not only by bonds of humanity, but by bonds of cold nies. That's the only surplus in the milk business. economies to those who now falter by the wayside through no These companies maintain a virtual monopoly. They fix prices fault of their own. to the farmer. And the difference between the two returned some What is our material wealth? It is made up of factories, farms, of the larger milk companies a profit of 30 percent consistently stores, and mines in which the needs of men are made and dis­ through the worst years of the depression. tributed. When that distribution stops, when production stops, This administration will end that in Pennsylvania. There is wealth vanishes. No man is so rich that his fortune can long en­ going to be a milk-control law with teeth in it. Since prices are dure without that foundation of all business-<:ustomers. Custom­ already being fixed for this public necessity, then the public is er&-in this mass-production age--means the whole body of labor. going to have the controUing voice in the milk business of this . . For a long time past, labor has not received its proper share of State . the profits of industry. The farmer is not getting his proper share Such regulation is the only alternative to public ownership. The of the profits of the farm. big milk dealers are not the only ones who do not recognize this By " proper " I do not only mean fair and just-I mean the share danger. Their brothers of the utilities seem quite as blind to the which ts called for by the iron necessity of the business set-up of impending storm. They won't shorten sail, although the hurri­ this country. cane warnings fly from every jackstaff on the political coast. CITES NEED FOR MARKETS PLEDGES STRINGENT CONTROL I mean that America needs new markets for the products of her But the utilities do not yet realize that the golden goose is in his machines and farms. We cannot find them abroad. We cannot death throes. I want to save the utility companies. I want to find them on Mars. We must create new markets by increased protect the thousands of investors in utility companies in Penn­ purchasing power to the customers of industry, the masses who sylva..nia. These investors will suffer if public-ownership competi­ labor in field, factory, and store. tion comes. The movement for municipal light and power plants As Governor of this State, which is truly the keystone of Amer­ is growing throughout the country. ica's industrial system, I shall wage a determined fight to readjust I know we are supposed to have utility regulation in this State the balance of purchasing power. Minimum-wage laws, abolition at present. But that is not the sort of regulation I'm talking of sweatshops, protection of the right of unionization, decent about. This administration will introduce a public-utility law so workmen's compensation laws, and unemployment insurance are stringent that no public-service commission can stultify it without but a few of the lines on which this fight must be won. Child full public knowledge. labor must never return. Relations between utility companies and their holding com­ Pennsylvania has- lagged behind in legislation and executive panies should be under the jurisdiction of the public service policy in this vital field. Some of our so-called "better citizens" commission. have boasted that labor was weak in Pennsylvania; that this was a Further, all expenditures of utility companies should be subject "good" State for employers. That boast sticks in their throats to public scrutiny and control. today if they have intelligence enough to realize that the depres­ It has been the practice for many years to use a part of the sion has been intensified here precisely because Pennsylvania surplus profits squeezed from the public to fight the public. lagged in labor legislation. Candidates have been bought with utility-company campaign DEPLORES FATE OF AGED contributions, usually in secret. Lobbies have been maintained Nor am I going to forget the veterans of industry and the vet­ here at Harrisburg by these funds. So great has been the power erans of agriculture, who have just as much claim upon the State as of these extralegal groups that not a bill passed. not a move ·the veterans of our wars. In settled rural communities of a could be made without their consent. century ago old age brought its recompense. It brought rest and We propose to root out the lobby evil. First, to destroy the the security in which the younger members of the family carried on utilities' lobby by cutting off its source o! revenue. Second, by in the well-loved fields to earn the living by which they supported striking at all lobbies. their parents. There must be an end to the invisible government by lobbies That is gone now. Filial devotion has not died. Sons still want and lobbyists in Pennsylvania. The legislation of Pennsylvania to care for their parents. But often they cannot. The shift and must be written in the State capitol and not in the private strain, the insecurity, has become too great. If they can save a parlors of Harrisburg hotels where special-privilege lobbies have penny, they need it for their own wives and children. No man held forth so many years. knows today what economic misfortune tomorrow will ·bring. So SEES MOCKERY OF GOVERNMENT the aged, who, in their prime, bullt the present, are shunted out into economic and social oblivion. I intend to give the people a day-by-day account of the ac­ This army of worthy old men and women is beaten into exile tivities of these lobbyists if the necessity arises. Any legislator from the economic system at every crisis, just as aged inhabitants influenced by them will have to make his explanations to his of besieged cities were once sent to die outside the walls so they constituents. It is time that this vicio~ system, which makes a would not deplete the rations. mockery of representative government, be dragged out into the open and into the light of publicity. Only in that way can it be MAKES PLEA FOR RELIEF ended. We who revert to this barbarism have not even the excuse I have another word of warning, not unconnected with the of necessity. We have the machines, the tools, the materials to utilities, for it refers to their real master&-a little group of all­ produce enough for all without sacrifice. We can feed these aged. powerful bankers. These bankers are the backbone of the reac­ Then in the name of humanity and hard-headed se:µ.se, let us tionary opposition to the new deal. These bankers have a fond­ feed them! Let us give them a decent life in their own homes ness for masking their activities behind the phrase" protection far· when their work 1s done. An old-age pension system 1s not a. the widows and orphans." · LXXIX--40 - ~26 CONGRESSIONAL RECORD-HOUSE JANUARY 17 Strike at excess milk protlts and they cry out that widows snd halt starved on Federal doles. We want to make, to build, to orphans are the shareholders of the milk companies. Strike at high earn a living wage. We cannot in a day or a decade stop the utility rates and the same wail rends the skies. It ls these bankers trend of centuries which instituted the necessity of work. If we themselves who are endangei:ing the funds of widows and orphans try, beware of disastrous psychological consequences. by driving the consuming publtc to desperation. We will ca.re for the unemployed, but let us beware of creating Wall Street sent $14,000,000,000 of American funds abroad 1n the unemployables. This 1s a Nation of workers. Please God it may last 10 years, exclusive of the wa.r debts. How much of those foreign not be saved from being a Nation of economi.c slaves only tQ loans are coming back? Precious little. We all know that now. become a. Nation of drones. PLEDGES PROTECTION My administration will cooperate to the utmost in an intensified But these bankers knew it then. And whose funds were these? relief program. Above all, let the expenditures be concentrated so Widows' and orpharls' and the ordinary American small investor. that business can feel a. real impact of purchasing power. Only Do you hear them deploring this betrayal of the widows and thus will confidence be restored. Only thus will business begin to orphe.ns? reemploy our idle millions. We cannot use trench-warfare tactics This administration will do its utmost to protect the investors of against the depression. We must strike with the full-focused Pennsylvania. But it will take neither direction nor advice from strength of all our financial resources. this powerful banking clique which 1n the past has had so much to Do not misunderstand nie. Because I believe in spending money say about the operation of this State government. For the next 4 for recovery, it does not follow that I do not appreciate the im­ years, and I hope I epeak loudly enough to be heard in Wall Street­ portance of economy in governmental administration. I intend it's "Hands otf Harrisburg." to conduct the State government on strictly businesslike lines. It I am deeply concerned over the plight of those thrifty men and is not supposed to be good politics to cut down on pay rolls. But women who, through no fault of their own, have sutfered .because that is exactly what I intend to do. their savings a.re tied up in closed banks. Liquidation of these FAVORS LOCAL REORGANIZATIONS deposits has been slower in Pennsylvania than in any other State. There is no excuse for this. We are going to speed up the process Local communities, particularly Phlladelphia and Allegheny of returning these funds to their owners. Counties, can save money for their taxpayers by reorganizing their The banking lobby here has blocked certain legislation designed governments. Consolidation to meet modern conditions should to strengthen the banking system of the State. If this legislation be a part of the program of the State constitutional convention. had been in effect, I am convinced the banking collapse would have In closing, let me explain that I know well that I have said been far less severe. Let us remember that lesson. We must enact things in this address which the timid souls will consider politically restrietions which will make it more difficult for bankers to dissipate unwise. I have attacked powerful groups, well-established insti­ the funds of their depositors. tutions. I am ready to take the consequences. This office of Gov­ Building-and-loan associations have an almost unique and, in the ernor is the realization of my political ambitions, not the stepping main, honorable b1story here in.Pennsylvania. But in recent years stone. practices have crept into some bf them which should be stamped I will make mistakes, I know, but they will be mistakes of the out so that these splendid institutions may regain their real place head and not of the heart. I will never do anything or refrain in the financial life of the community. from doing anything because of considerations of my future politi­ Pennsylvania plutocracy retlects itself also in our tax situation. cal career or the future political career of any of my friends. Although 60 percent of the wealth within the State ls ln the This administration is going to live and work in the present. That form of stocks, bonds, and other personal property, 90 percent task is large enough. of loca.l taxation is derived from real estate. This grossly unfair I will be more than content if 4 years from today I can feel that situation ls a p~rfect example of the dead hand of the past I have played a. small but willing part in the saving of this Nation crushing the present, which I mentioned earlier. from the dangers that encompass it; that I have helped it push When our present State constitution was written in 1874, real forward to new economic and political frontiers. estate amounted to 90 percent of the wealth and should have We know in which direction the salvation of democracy and borne that portion of the tax. But is there any reason why a American ideals lies. Let us go forward! situation which existed 60 years ago should crush our home­ owners and farmers today? ADJOURNMENT The remedy lles in a graduated State income tax. The sound­ Mr. TAYLOR of Colorado. Mr. Speaker, I move that the est tax is that based on the principle of abil1ty to pay. We are House do now adjourn. going to bring that principle to Pennsylvania. Revision of the State constitution is absolutely necessary. The motion was agreed to; accordingly (at 4 o'clock Pennsylvania simply cannot continue further with the absurdly and 43 minutes p. mJ the House adjourned until tomorrow, antiquated constitutional provision which restricts its borrowing Friday, January 18, 1935, at 12 o'clock noon. capacity to $1,000,000, an infinitesimal part of our annual ex­ penditures. No business could operate soundly on that basis. In times CHANGE OF REFERENCE of stress such w; these, we ought not increase taxes drastically to meet the necessity for inc1·eased relief expenditures. The Under clause 2 of rule XXII, the Committee on the Post sound way, the business way, is to borrow when expenditures Office and Post Roads was discharged from the considera­ must be increased and pay back 1n days of increasing income. tion of the bill CH. R. 2422) for the relief of James O. Th.ls fossilized restriction causes the State treasury to face today a. grave financial crisis which would not have arisen under a Greene and Mrs. Hollis S. Hogan, and the same was ref erred modern constitution. to the Committee. on Claims. PLANS BUDGET MESSAGE I wm discuss the serious financial problems which confront the PUBLIC BILLS AND RESOLUTIONS Commonwealth in detail in a budget message which I will ad­ dress to the legislature in the near future. Under clause 3 of rule XXII, public bills and resolutions Constitutional revision is one of the most immediate needs of were introduced and severally referred as follows: Pennsylvania. We can all see it is no academic subject if a very By Mr. DOUGHTON: A bill CH. R. 4120) to alleviate the 111-timed tax increase ls made necessary in order to meet the needs of relief. hazards of old age, unemployment, illness, and dependency; Can we reduce State relief expenditures? There is no escape to establish a Social Insurance Board in the Department of in that direction as long as the Federal Government does not bear Labor, to raise revenue, and for other purposes; to the Com­ the full burden. As long as Washington does not assume entire respon.siblllty, there can be no talk of cutting rellet expenditures. mittee on Ways and Means. It is quite likely that we can effect some a.dmlnlstrative savings By Mr. JENKINS of Ohio: A bilf (H. R. 4121) to amend by coordinating the various relief agencies which now duplicate the Federal Aid Road Act, approved July 11, 1916, as each other to some exte11.t. But such savings we must not keep. amended and supplemented; to the Committee on Roads. They must be passed along in increased benefits to the unem­ ployed whose present subsistence level 1s shamefully low. By Mr. BUCK: A bill CH. R. 4122) to improve :r:iavigation I know there is a. sneering mention of Santa Claus whenever and to control destructive flood waters on the Sacramento any public ot'ficial advocates an increase in relief. Such propa­ and San Joaquin Rivers in the Stat.e of California, to aid ganda fails to impress me. I know from whence it emanates. The same banking group that shudders at a Federal expendi­ and improve agriculture and industrial development within ture of $4,000,000,000 1s the one that sent your $14,000,000,000 said river basins, and for other purposes; to the Committee over to Europe and down to South America ne'\l'er to return. on Flood Control. CITES WALL STREET DEBACLE By Mr. BUCKLER of Minnesota: A bill (H. R. 4123) pro­ What of the $80,000,000,000 of infiated 1929 valuation, which viding for the payment of $25 to each enrolled Chippewa withered away? Where are the expressions of contrition from Wall Street for that debacle? Are they hiding their faces in Indian of the Red Lake Band of Minnesota from the timber shame? Not they. From behind the backs of the widows and funds standing to their credit in the Treasury of the United orphans these brave grenadiers of high finance are firing their states; to the Committee on Indian Affairs. propaganda of so-called "economy and budget-balancing" against By Mr. FISH: A bill CH. R. 4124) to provide for the na­ the unemployed, the helpless, the down-trodden. I believe in work relief rather than the dole. Work ls in this tional security and defense; to the Committee on Military Nation's blood a.nd sinews. Americans do not want to Idle about Affairs. 1935 CONGRESSIONAL RECORD-HOUSE 627 By Mr. KERR: A bill , a bill granting an increase of pension to By Mr. GREENWOOD: A bill CH. R. 4166) granting a Marie 0. Fowler; to the Committee on Invalid Pensions. pension to Rebecca Brown; to the Committee on Invalid Also, a bill CH. R. 4201) granting an increase of pension to Pensions. Mary E. Freeman; to the Committee on Invalid Pensions. Also, a bill CH. R. 4167) for the relief of Frank Mulder; Also, a bill CH. R. 4202) granting an increase of pension to to the Committee on Military Affairs. Susan B. Hill; to the Committee on Invalid Pensions. By Mr. IMHOFF: A bill CH. R. 4168) for the relief of Also, a bill CH. R. 4203) granting an increase of pension to Theodore Torok; to the Committee on Claims. Nancy Fopay; to the Committee on Invalid Pensions. By Mrs. KAHN: A bill CH. R. 4169) for the relief of Anna· Also, a bill : Resolution of the on Banking and Currency. Philadelphia Board of Trade, opposing legislation for the 221. By Mr. PFEIFER: Petition of the American Legion, immediate cash payment of the soldiers' bonus; to the Com­ national legislative committee, Washington, D. C., recom­ mittee on Ways and Means. mending the immediate cash payment of the face value of 206. By Mr. KRAMER: Resolution of the board of gov­ the adjusted-service certificates, with cancelation of interest ernors of the State Bar of California, with respect to legis­ accrued and refund of interest paid; to the Committee on lation to provide for two additional judges for the United Ways and Means. States District Court for the Southern District of California; 222. Also, petition of the Franklin Society, New York City, to the Committee on the Judiciary. relating to the present unfair discrimination against State- 630 CONGRESSIONAL RECORD-SENATE JANUARY 18 chartered savings and loan associations; to the Committee E~T F. WAGNER, of the State of New York, again introduce on Banking ·and Currency. his labor-disputes bill in its original form at the conven­ 223. Also, petition of the Rocky Mountain National Fur ing session of Congress; to the Committee on Labor. Growers Association. Denver, Colo., protesting against excise tax on furs; to the Committee on Ways and Means. 224. By Mr. STEFAN: Resolution adopted by the Surety SENATE National Farm Loan Association of Dodge, Nebr., respecting FRIDAY, JANUARY 18, 1935 fuller exercise by Congress of its power to coin and regulate money; to the Committee on Banking and Currenc·y. (Legislative day of Thursday, Jan. 17, 1935) 225. Also, resolution adopted by the Surety National Farm The Senate met, in executive session, at 12 o'clock merid· Loan Association of Dodge, Nebr., asking Congress to estab­ ian. on the expiration of the recess. lish a permanent rate of 4-percent interest on farm mort­ THE JOURNAL gages made through the Federal Farm Credit System; to the Committee on Agriculture. On request of Mr. ROBINSON, and by unanimous consent 226. Also, resolutfon adopted by the Surety National Farm the reading of the Journal for the calendar day Thursday: January 17, 1935, was dispensed with, and the Journal was Loan Association of Dodge, Nebr., asking Congress for a thorough investigation of the meat-packing business in the approved. United States as it relates to the interests of livestock pro­ MESSAGE FROM THE HOUSE ducers; to the Committee on Agriculture. A message from the House of Representatives, by Mr. Halti· 227. By Mr. THOMAS: Petition of Senate of the State of gan, one of its clerks, announced that the House had agreed New York, asking that the Secretary of Agriculture of the to Senate Concurrent Resolution 4, as follows: United States be requested to supplement the regulations Resolved by the Senate (the House of Representatives concur.. made by New York State pertaining to the production, han­ ring), That the statues of Caesar Rodney and John M. Clayton. presented by the State of Delaware and placed in Statuary Han, are dling, and marketing of milk within the State by ma.king accepted in the name of the United States, and that the thanks o! effective at the earliest possible date such Federal regula­ Congress be tendered the State for the contribution of the statues tions as will place milk produced in other States and mar­ of two of its most eminent citizens whose names are so thoroughly keted within the State of New York under similar regula­ identified with the State and Nation; be it further Resolved, That a copy of these resolutions suitably engrossed and tions to those applied by the State to milk produced within duly authenticated be transmitted to the Governor of Delaware. its borders; to the Committee on Interstate and Foreign EXECUTIVE REPORTS OF CO.MMITTEES Commerce. 228. Also, petition of the Assembly of the State of New Mr. COSTIGAN. From the Committee on Finance I report York, asking that the Congress of the United States and the back favorably the nomination of Miss Josephine A. Roche, Postmaster General of the United States be respectfully of Colorado, to be Assistant Secretary of the Treasury. memorialized to take appropriate action to the end that the Mr. GUFFEY, from the Committee on Finance, reported Floyd Bennett Field Airpnrt in the borough of Brooklyn. favorably the nomination of James L. O"Toole, Jr., of Pitts· State of New York, be designated as an air mail service sta­ burgh, Pa., to be collector of inte1·nal revenue for the twenty­ tion for the city of New York and the environs of such third district of Pennsylvania, in place of David L. Lawrence, city; to the Committee on the Post Office and Post Roads. resigned. 229. Also, petition of the Senate of the State of New York, Mr. HARRISON, from the Committee on Finance, re­ memorializing the United States Congress to consider legis­ ported favorably the nomination of Sigmund Solomon, of lation looking to either taking all profits out of war or put­ New York, N. Y., to be superintendent of the United States ting the business of manufacturing munitions of war solely assay office at New York, N. Y., in place of Niles R. Becker. in the hands of the United States Government; to the Com­ He also, from the same committee, reported favorably the mittee on Military Affairs. nomination of Joseph S. Buford, of New York, N. Y., to be 230. By Mr. TRUAX: Petition of Local Union No. 231, of assayer of the United States assay office at New York, N. Y., the United Mine Workers of America, organized into a bona in place of Burt G. Shields, resigned. fide trade union, affiliated with the American Federation of He also, from the same committee, reported favorably the Labor, hereby requesting the Honorable ROBERT F. WAGNER, nomination cf Harry M. Brennan, of Louisville, Ky., to be of the State of New York, to again introduce his labor­ collector of customs for customs collection district no. 42, di.sputes bill, in its original form, at the convening session with headquarters at Louisville, Ky., to fill an existing of Congress; to the Committee on Labor. vacancy. 231. Also, petition of District Five Conference of the Phi He also, from the same committee, reported favorably the Delta Kappa Educational Fraternity, by their district rep­ nominations of the following collectors of internal revenue: resentative, Don C. Rogers, urging the National Congress Philem on C. Merrill, of Safford, Ariz., for the district of first to appropriate sufficient additional funds for the Pub­ Arizona, to fill an existing vacancy; lic Works Administration to permit an extensive school­ Fred C. Martin, of Bennington, Vt., for the district of Ver­ building construction program, and, second, to authorize mont, to fill an existing vacancy; and such a ratio of financial contribution toward the construc­ Joseph T. Higgins, of New York, for the third district of tion of school buildings that the Federal Government will New York, to fill an existing vacancy. provide a larger proportion of the cost than at present; to Mr. HARRISON also, from the Committee on Finance, the Committee on Appropriations. reported favorably the nominations of sundry officers in the 232. Also, petition of Division No. 168 (Lima, Ohio>, Ben­ Public Health Service. efit Association of Railway Employees, by their secretary, Mr. HAYDEN, from the Committee on Post Offices and Frank Dobner, requesting that the Honorable CHARLES v. Post Roads, reported favorably the nominations of sundry TRuAX, Member of Congress from the State of Ohio, be postmasters. requested by this body, consisting of 775 railway employees, Mr. POPE, from the Committee on Mines and Mining, re .. exclusive of their families, to support to the fullest extent ported favorably the nomination of John Wellington Finch, enactment of legislation to modify the fourth section of the of Idaho, to be Director of the Bureau of Mines, he having Interstate Commerce Act to regulate commerce so as to per­ been appointed during the recess of the Senate, vice Scott mit the railroads to compete with unregulated forms of Turner, resigned. transportation as recommended by the Federal Coordinator The VICE PRESIDENT. The nominations will be placed and covered in the Pettengill bill