5292 CONGRESSIONAL RECORD-HOUSE APRIL 12 Ordinance of 1787 and the settlement of the Northwest 4797. Also, petition of the International Artificial Limb Territory; to the Committee on the Library. Co., New York City, concerning the manufacture of artificial By Mr. CULKIN: Joint resolution United States; to the Committee on the Committee on Military Affairs. Post Office and Post Roads. 4800. Also, petition of the Chamber of Commerce of the State of New York, with reference to Federal licensing of PRIVATE BILLS AND RESOLUTIONS business enterprises; to the Committee on Patents. 4801. Also, petition of the Chamber of Commerce of the Under clause 1 of rule XXII, private bills and resolutions State of New York, concerning the national defense, by the were introduced and severally referred as follows: enlargement of the United States Navy and otherwise im­ By Mr. CROWE: A bill (H. R. 10230) granting a pension prove the national defense; to the Committee on Naval to Charity Cooper; to the Committee on Pensions. Affairs. By Mr. CULKIN: A bill eaker, I ask unanimous consent to festation of your courtesy and your esteem and your regard. address the House for 1 minute. You have been extremely forbearant with all my infirmities. The .SPEAKER. Is there objection to the request of the I want you to know I love you all and appreciate the cordial gentleman from New York? -sentiments that have been expressed with reference to my There was no objection. birthday. [Applause, the Members rising.] LXXXIII--334 5294 CONGRESSIONAL REC-ORD-HOUSE APRIL 12 THE REVENUE BILL, 1938 Mr. THOMPSON of lllinois. Mr. Speaker, further reserv­ Mr. DOUGHTON. Mr. Speaker, I .ask unanimous consent ing the right to object, I would like to call the attention of to take from the Speaker's table the bill H. R. 9682, the the chairman to the fact that during the consideration of revenue bill, with Senate amendments, disagree to the Sen­ this revenue bill in the House there was considerable con­ ate amendments, and request a conference with the Senate. troversy about a tax on imported pork and pork products, Mr. LAMNECK. Mr. Speaker, reserving the right to ob­ and the House voted upon that question. ject, I only do this to make an observation. I am informed that the other body also voted upon it. I I believe we have an opportunity in this bill to do some­ am wondering whether or not the House will be given an thing that will restore confidence in business in this coun­ opportunity to vote on that amendment again. Will the try, and if I had my way I would today accept the Senate conferees bring the bill back in such shape that the parlia­ bill without the crossing of a "t" or the dotting of an "i," mentary situation will be that we may get another vote on and let the country know what the tax bill is going to be. that extremely controversial question? I hope when this bill goes to conference we will not have Mr. DOUGHTON. I do not think that I can tell about a long drawn out battle as to· whether or not we are to re­ that until we go into conference. tain the section pertaining to the undistributed-profits tax Mr. THOMPSON of Illinois. Naturally I am hopeful that or whether we are to have the tax that the·senate put in the the conferees to be appointed to act on the part of the bill. I say in all sincerity, and I hope the distinguished chair­ House will insist on the House amendment, inasmuch as man of the Committee on Ways and Means will listen to there was a direct roll-call vote upon it. I have seen no what I have to say because I believe the business interests intimation that the Members of the House have changed of this country are absolutely opposed to the undistributed­ their position regarding that particular tax, because agri­ profits tax, not because it is going to levy a high tax on culture needs the assistance contemplated therein. them, but they have the fear that we may use that principle Mr. DOUGHTON. We necessarily want to have a free and raise the rates and change the schedules, and they are conference, and I am sure the conferees on the part of the simply afraid of it. I hope we shall make no determined House will approach the matter in good faith. effort to restore that section of the tax bill. Mr. THOMPSON of Dlinois. I hope the gentleman will Mr. MAPES. Mr. Speaker, will the gentleman yield for a bring it in in such shape that we can get a separate vote on question for information? that particular item. Mr. LAMNECK. If I have the floor I shall be pleased to Mr. DOWELL. Mr. Speaker, will the gentleman yield? yield. . Mr. DOUGHTON. Yes. , Mr. MAPES. I have seen the criticism of the Senate bill Mr. DOWELL. What about the Borah amendment? Will that it levies a higher tax and imposes more of a tax burden the House get an opportunity to vote on that amendment? upon the small corporations than the House bill. What does Mr. DOUGHTON. I could not tell about that. I could the gentleman say about that criticism? not give the gentleman any information on that subject at Mr. LAMNECK. As I understand the Senate bill, all cor­ this time. I do not know what we will do. There are many porations that earn less than $2,300 would pay no tax. amendments in the Senate bill, 239, I understand, 25 or Mr. MAPES. Without going into the details, what is 30 of which were adopted without any consideration by the there to this general criticism of the Senate bill? Committee on Finance. Yet the gentleman from Ohio [Mr. Mr. LAMNECK. I cannot see that any such criticism is LAMm:cKJ thinks that we should blindly disregard the action justified. Some corporations, of course, will pay a little of the House in the consideration of the bill, and the study higher tax, while other corporations will not pay any tax, .of the bill by th~ Committee on Ways and Means and and a great many of the small corporations will pay less blindly accept what the Senate has done. I do not think we taxes under the Senate bill than under the House bill, but should approach it in that way. The gentleman seems to so far as I can see, I believe business generally would ac­ ~ave very little confidence in what the House has done, or cept that bill and be well satisfied with it, and it seems to m what his own committee has done, and accepts blindly me the least the House can do would be to agree to that what the Senate has done as to the 239 amendments 25 of particular -section of the Senate bill and allow us to let which were put on without any consideration by the' Com­ industry know what the real tax is going to be. mittee on Finance. Such is not my conception of the duty Tills is all I have to say, Mr. Speaker, I am not going to of the conferees. We will approach the question with open object to the request. minds for the purpose of doing what is right. . Mr. MAPES. Mr. Speaker, reserving the right to object, I Mr. TREADWAY. Mr. Speaker, I hope the Members of wonder if the distinguished chairman of the Committee on the House on both sides will not press the conferees at this Ways and Means would answer the question that I have just time to express any opinions as to what is likely to occur in propounded a little more definitely. Does the Senate bill conference. It seems to me that conferees are appointed for levy a higher tax on corporations whose earnings are less the purpose of having a free and open discussion of the than $25,000 than the House b111? ,points of difference between .the two bodies, and to have Mr. DOUGHTON. As to some of them it does and with Members make such requests as have been made, or attempt l'espect to others it does not. , to get advance information from the conferees, does not Mr. FRED M. VINSON. Mr. Speaker, will the gentleman strike me as favorably inclining toward an open and free yield? discussion of the questions involved. Mr. MAPES. I yield. Mr. MICHENER. Mr. Speaker, if the gentleman will Mr. FRED M. VINSON. For corporations with net incomes yield, I could not hear what tlie chairman of the committee of less than $6,500 the Senate bill has a lesser tax, while said; but I take it, knowing the gentleman, that he meant between $6,500 and $25,000 of net income there is a larger to tell us that he would bring the conference report. back to tax. When you get to the $25,000 line the added tax under the House in such a way that the House would be permitted the Senate bill is $975. The corporate taxes, as I understand to vote on all controversial matters. That was it, was it not? it, under the Senate bill will bring in some eighty-nine Mr. DOUGHTON. Oh, I did not say that. Tile gentle­ million more of dollars than the corporate taxes in the man is like myself. He does not hear any too well. House provisions. The SPEAKER. ·Is there objection to the request of the Mr. MAPES. Then, as I understand it, the criticism to gentleman from North Carolina? which I have referred would apply to corporations that have There was no objection. an income between $6,500 and $25,000, but it would not apply The Chair appointed the following conferees: Mr. DouGH­ to those that have an income of less than $6,500. - TON, Mr. CULLEN, Mr. FRED M. VINSON, Mr. COOPEil, Mr. Mr. FRED M. VINSON. That is correct. TREADWAY, and Mr. CROWTHER. 1938 CONGRESSIONAL RECORD-HOUSE 5295 EXTENSTON OF REMARKS The records show that on December 1, 1935, Peter Sietsma Mr. KNUTSON. Mr. Speaker, I ask unanimous consent was driving an automobile near Monon, Ind., with his Wife to extend my remarks in the RECORD and to include therein and three children as passengers. They encountered three a radio address delivered by myself. enrollees of the Civilian Conservation Corps, who were ab­ The SPEAKER. Is there objection? sent from a nearby camp without leave. One of the en­ There was no objection. rollees threw an empty whisky bottle, which struck and broke Mrs. JENGKES of Indiana. Mr. Speaker, I ask unani- the windshield of the clai:p:1ant's automobile and caused per­ mous consent to extend my remarks in the RECORD. sonal injuries to the occupants of the vehicle. Thereafter The SPEAKER. Is there objection? the enrollees were. tried and convicted in a local court and There was no ol:)jecfion. dismissed from the Civilian Conservation Corps. The sum of $39.50 represents the amount of the medical expenses in­ EMPLOYEES IN THE CUSTOMS FIELD SERVICE (H. DOC. NO. 586) curred by Mr. Sietsma, and the cost of replacing the wind­ The SPEAKER laid before the House the following mes- shield. sage from the President of the United ·States; which was It will be observed that at the time of the unfortunate oc­ read: currence, the enrollees were absent from camp without leave and were not acting within the scope of their employment. To the House of Representatives: Even if the United States were subject to suit, it would hardly I am returning h~rewith, without my approval, H. R. 7948, be liable for damages under the circumstances involved in Seventy-fifth Congress, entitled "An act providing for the this claim. promotion of employees in the Customs Field Service." The fact that the person causing the injury happened to be Section 1 of the bill establishing automatic promotions to a Government employee, does not of itself, create any moral the maximum of the grade is ·fundamentally objectionable obligation on the part of the GOvernment, if, as was the fact for the following reasons: in this instance, the damages were brought about by a wanton 1. It runs counter to the basic principle of section 7 of act committed by him away from Government premises and the Classification Act of 1923, as amended, which provides when he was not performing any official function. that "increases in compensation shall be allowed upon the While the amount involved in this claim is small, any ac­ attainment and mainten~nce of the appropriate efficiency tion taken thereon may form an important precedent for ratings, to the higher rate' within the salary range of the . the disposition of similar claims which may perhaps involve grade"; larger sums of money. 2. It is in confiict with the provision in all the depart­ It is to be greatly regretted that the claimant was injured mental appropriation acts for the current fiscal year and in as the result of a wanton act of an enrollee of the Civilian all the departmental appropriation bills for the next fiscal Conservation Corps. Nev:ertheless, in view of the foregoing year which requires (with minor exceptions) that the average circumstances, I am constrained to withhold my approval of of the salaries of the total ·number of persons under any this measure. grade in any bureau, office, or other appropriation unit shall FRANKLIN D. ROOSEVELT. ·not, at any time, exceed the average of the compensation THE WHITE HOUSB, April 1.2, 1938. rates specified for the grade to which positions have been The SPEAKER. The objections of the President will be allocated under the Classification Act of 1923, as -amended. spread at large upon the Journal. Section 1 of this bill would thus give preferential treat­ Mr. RAMSPECK. Mr. Speaker, I move that the message ment by providing automatic promotions to the top of the and the bill be referred to the Committee on Claims and grade foi approximately 7,500 employees who are perfOrming ordered printed. a character of duties similar to those performed by large The motion was agreed to-. numbers of employees in other departments whose promo­ :tions are controlled by the provisions of the Classification CHAIN -STORE LEGISLATION Act of 1923, as amended, and by the average provision in the Mr. PATMAN. Mr. Speaker, I ask unanimous consent to respective appropriation acts. proceed for 1 minute and. to extend my remarks in the For these reasons I do not feel that I would be justified RECORD. _ in approving this bill. The SPEAKER. Is there objection? FRANKLIN D. RoosEVELT. There was no objection. THE WHITE HousE, April 12, 1938. COLLIER'S EDlTORIAL AGAINST FEDERAL CHAIN-STORJ: TAX - Mr. PATMAN. Mr. Speaker, Collier's Magazine of April 9, The ~EAKER. The objections of the President wm be 1938, contained. an editorial which was critical of H. R. 9464, spread at large upon the Journal. a blll providing for a Federal tax on chain stores, which is Mr. COOPER. Mr. Speaker, I move that the bill and the sponsored by 75 Members of the House of Representatives message be referred to the Committee on Ways and Means including myself, from 33 States. - · · ' and ordered printed. In the editorial it was stated: The motion was agreed to. Evidently they think there are votes in the b1ll. PETER SIETSMA (H. DOC. NO. 587) Consumers seem to be politically negligible. Ten years. ago, a car buyer ·paid $2 for a.s much horsepower as he The SPEAKER also laid before the House the following now gets for $1. Comfort, safety, utility, and beauty have been message from the President of the United States, which was enormously enhanced by large corporations. Large-scale enterprise did It. read: . Generally speaking, electric rates have- been cut in half during the last 25 years. Perhaps they should have been cut lower still. How­ To the House of Representatives: ever, the gains actually made are the results of large business I return herewith, without my approval, House bill 5603, enterprise. ' entitled "An act for ~he relief of Peter Sietsma." EDITORIAL COMMENDS KIND OF BUSINESS WE ARE. STRIVING TO PRli:SEJ'tVE The bill proposes to authorize and direct the Secretary of Let us analyze this editorial. How can consumers be po­ the Treasury to pay to Peter Sietsma of Monon, Ind., the litically negligible when. all voters are consumers? How can sum of $39.50 in satisfaction of his claim. against the United we tlrink there are votes in the bill if we cannot show it is. in states for personal injuries sustained . by members of his the interest of the general welfare of the people. 1 grant family, and damage to his automobile re~ting from the act that the motor industry has made great progress. The writer of an enrollee of the Civilian Conservation Corps in throwing of the editorial overlooked one fact which I shall call to his an empty whisky bottle through the windshield. attentiQn. Retail .distribution in the motorcar industry is 5296 CONG.RESSIONAL RECORD-HOUSE APRIL 12 made through independent businessmen whose money is kept own cars, if we come in our own cars, there is no reason why at home and who help to build the community in which they the old principle that gave 20 cents a mile should any longer live. We are indebted to Collier's· for making it so opportune be in use. Personally, I feel that the thing that ought to be for us to point out this great example of the value of inde­ done is to give the Members actual mileage costs. . Their pendent retail business which we are endeavoring to preserve. secretaries or office force should also be given actual mile­ POWER RATES FORCED DOWN age transportation costs. I feel that this would be a much Now, about the electric rates. Did the companies them­ fairer method than the one now being used, and it is for this selves voluntarily lower these rates? Collier's indicates that reason that I have offered this amendment. they did. Such is not the fact. They were lowered after Mr. SNElL. Mr. Chairman, will the gentleman yield? the people had placed them under public-utility commissions Mr. SAUTIIOFF. I yield. charged with the duty of protecting the public against un­ Mr. SNElL. Do I understand that the gentleman's reasonable and extortionate charges. amendment means simply to pay actual expenses of one NO ONE TO PROTECT PUBLIC AGAINST ROBBERY PRICES IN RETAIL round trip home? DISTRIBUTIONS Mr. SAUTHOF'F. Yes. I am afraid Collier's has overlooked another important Mr. SNElL. What about the case of the Member who has point. If a few companies obtain control of retail distribution to make two or three trips during the session? As I have like they did public utilities, there will be no commissions to always understood the mileage proposition, it was simply to protect the people against robbery prices. Then the people take care of the necessary trips that a man had to make back will say private monopoly is indefensible and demand Gov· and forth between his district and Washington. · ernment ownership. So the fight we are making today is Mr. SAUTIIOF'F. I understand that. I still feel, how­ against eventual Government ownership and in favor of ever, that my amendment presents the method that ought private property and the profit system. to apply. If the gentleman feels that the 20 cents a mile I AGRICULTURAL APPROPRIATION BILL, 1939 should be used because we make other trips, then say let us be honest about it and put in bills to take care of what­ Mr. CANNON of Missouri, from the Committee on Appro­ ever other trips we take and have them audited by the Claims priations, reported the bill Switzerland of America." A State full of scenes of (H. R. 10216) making appropriations for the legislative branch surpassing beauty and grandeur, wit.h its hills and valleys of the Government for the fiscal year ending June 30, 1939, and ever-changing panorama of broad and fertile meadows, and for other purposes, had directed him to report the bill . precipitous rugged cliffs, narrow tortuous valleys, through back to the House with sundry amendments, with the recom­ which prances merrily the sparkling stream, or runs more mendation that the amendments be agreed to and that the sedately its larger brother, winding among and between the bill, as amended, do pass. green-crowned hills, which rise one above another until they Mr. DOCKWEILER. Mr. Speaker, I move the previous are lost in the ragged line at the crest of the mountains. question on the bill and all amendments thereto to final "I will look unto the hills;. from whence cometh my passage. &trength" are the words of a man filled with inspiration that The previous question was ordered. comes only to one accustomed to the sight of the everlasting The SPEAKER. Is a separate vote demanded on a~y hills. amendment? If not, the Chair will put them in gross. In the valleys and on the meadows and on the hillsides are The amendments were agreed·to. the well-tilled farms with their commodious and convenient 1938 CONGRESSIONAL RECORD-HOUSE 5299 homes surrounded by the fields which yield their abundant true that the people of Vermont have not themselves always harvest. Vermont is an agricultural State. appreciated the value of their agricultural assets.

Vermont, of course, is very much interested in all matters THE ~ASHFUL STATE which pertain to and affect the dairy industry. It is a fact Some years ago an editor of the Rural New Yorker said, too generally overlooked, by those otherwise generally well under the caption "The Bashful State": informed, that Vermont is the second largest of the New One would hardly claim at first thought that such a title could England States, and that it has a cow population which ex-_ be made to fit New England. The Yankees are not supposed to ceeds numerically its men and women. This does not mean, be lacking in assurance, yet when it comes to trying to hide op­ portunities under a bushel Vermont can take the front seat. however, a_s someone has facetious~y suggested, that we are "bull headed." FIRST IN AVERAGE YIELD OF CORN Whatever anyone else may tell you, around 70 percent of I ran across a pamphlet which was· issued way back in the agricultural income in Vermont emanates from dairying. 1915 by the Vermont Bureau of Publicity when the Hon­ . It is our major industry, and necessarily anything which orable Guy W. Bailey was secretary of state, in which there a:tiects the sale of livestock and livestock products is of para­ is a GOmpilation of facts taken from the United States Cen­ mount interest to us. sus and Crop Reports which shows that for the year 1914 In 1935 the gross income derived from livestock and live­ no State raised "more bushels of com per acre than Ver­ stock products amounted to $32,880,000. mont, and only one State raised as much. The average _ HAS 302,000 Mn.K COWS price in Vermont paid farmers December 1, 1914, was 81 cents, while the average price paid throughout the United Do you know that according to the latest :figures of the States was 63.7 cents. For the 40-year period from 1870 to United States Department of Agriculture, Vermont has 1909, inclusive, Vermont ranked first in average yield of 302,000 milk cows, valued at $21,744,000, and that she had ~ushels of com per acre. 137,000 other cattle, the total value of which was $2,898,000, or a grand total valuation of her cattle population of SPRING WHEAT $24,206,000? Incidentally, her total ca~tle population -of That year-1914--only one State, and that in the irrigated 439,000 exceeds the number of her citizens. region of the West, raised more bushels of spring wheat per acre than Vermont-. The average Vermont yield was nearly HAD 45,000 HORSES two and one-half times that of the United States. The aver­ Talking about livestock population and valuation, I learn age price paid in Vermont during the then last few years from the same report as of date January 1, 1938, that Ver­ generally was more than 20 cents per bushel greater than mont had 45,000 horses valued at $6,358,000. She had 24,000 that reported for the entire United States. During the sheep valued at $134,000, and swine to the number of 31,000, period from 1870 to 1909, inclusive, only two States, and of the value of $335,000. those in the irrigated regtons of the West, surpassed Ver­ Now Vermont has more money invested in horses and mont in the average yield of bushels of wheat per acre. mules than in any other class of livestock except cows. Her horses and mules being worth 13 times as much as her sheep :MORE BUSHELS OF OATS and swine combined. There is a reason for this, for horses In 1914 only four States raised more bushels of oats per and mules still outrank any other class of livestock in capital acre than Vermont, and this State led all the big oat-pro­ invested in the Nation. ducing States in average yieid and price. Vermont's. aver­ age for the year was nearly 25 percent greater than that of The latest figures released by the United States Department the United States. For the 40-year period from 1870. to of Agriculture, Division of Livestock Estimates, for animals 1909, Vermont led the Union hi the average yield of. 'QuShels on farms Janua:ry·1_, 1938, disclose that there .were 11,163,000 of oats per acre. · horses and 4,477,000 mules on farms, and that they had an AND :MORE OF BARLEY aggregate value of $1,562,081,000. This was almost twice Only six States raised more bushels of barley per acre i~ the value of sheep and hogs combined. Furthermore, the 1914 than Vermont. The average Vermont price was 38 value of horses and mules exceeded by $206,000,000 the value percent greater than the average price in the United States. of all milk cattle FRANCE On those two texts 1 base the remainder of my brief I believe in the matter of public works, to which I am limit.. remarks. I believe that the· proposal that the Government, ing myself at the present time, that credit should be extended for example, should extend a billion and a half dollars of not by the issuing of bonds and the acquiring of bank-credit credit to the States and counties at no rate of interest, in funds, but by the Government itself exercisuig its sovereign order that the States and counties may construct necessary right to create the thing we now use as money, which is public works, is a good proposal I believe America has two credit. primary jobs to do, and that any patriotic lover of this coun­ I wish I had time to discuss with you how in France many try must see that they are done. The first one, I would say, of her diftlculties are due to the fact that they have prac­ is the· conservation of the resources of this country and their tically a hereditarY board of governors of the Bank of full development; and the second one is the elimination of France, consisting· of 18 people, only 6 of whom are govern­ slums. I believe that if we got the spirit to attack those ment representatives, who are in a position to'dictate a ·policy problems vigorously in this country, it would do much to to the French nation. I want to see that avoided, I want buoy up the spirit of our people. I say such a proposal to see the. United States become in truth a nation which at seems to me to be all right; but now iet us ask ourselves least exercises the same prerogatives given to private indi­ how shall the Government obtain funds for the purpose of viduals in the country with regard to the creation of its advancing that credit. money. And I believe that the factor which is missing and The CHAIRMAN. 'i'he.tl.me of the gentleman fro~ Cali­ the reason we find it necessary to go into debt to increase our fornia has expired. buying power is because we do not make possible by scientific Mr. CANNON of Missouri. Mr. Chairman, I yield the governmental action with regard to money and credit a gentleman 5 minutes more. healthy, normal increase in the wealth of America. Mr. STEFAN. Mr. Chairman: will the gentleman yield? If you have the same quantity of money in circulation to­ Mr. VOORIDS. Oh, please do not ask me to yield. day and· you increase production, then you have literally a Mr. STEFAN. I was going to ask the gentleman along the deflation taking place, the value of money going up and the lines of this noninterest loan. Would the gentleman extend value of goods and services going down. If we are to have that same credit to the farmers without interest? an expanding economy over a considerable period of time Mr. VOORIDS. I believe that cannot be done, though I at all, we must make possible the bringing into circulation certainly favor keeping the rate of interest to farmers at a without added debt of an increased amount of money, whether very low figure. This is a. question of governmental bodies, you use credit or cash money, corresponding to the increase but personally I do not care particularly whether credit is in wealth production. Our failure to see that point, and our extended to .them at no rate of interest or at 1 or 2 percent requirement that since we use bank credit for money, the only of interest. way the American Nation can bring about an increase in its THE CREATION OF CREDIT stock of money is by going into debt, obviously accounts very The point. I want to make is this-and I read from the largely for the fact that at present an increase in national testimoriy by Mr. EcCles, Governor of the Federal Reserve debt seems necessary in order to bring about the expansion Board, before the Banking and Currency Committee in 1935. of consuming power among our poorest people, without which At that time he said: our economic system simply will not run. To know what In purchasing offerings of Government bonds, the banking sys­ money and credit really are, to understand the effect upon tem as a whole creates new money, or bank deposits. When the them of increasing wealth is to know that such increases in banks buy a billion dollars of Government bonds as they are national debt for this particular purpose are not necessary. offered-and you have to consider the banking system as a whole, There is a better, sounder way. I hope I have explained it as a unit--the banks credit the deposit account of the Treasury with a billion dollars. They debit their Government bond account to some extent. [Applause.] a b11lion- dollars, or they actually create, by a bookkeeping entry, · The CHAIRMAN. The time of the gentleman from Cali­ a b1111on dollars. fornia has again expired. If that can be done by private banks why in the world can­ Mr. CANNON of Missouri. Mr. Chairman, I yield now to not the Government of the United states do the same thing? the gentleman from Ohio [Mr. FLETCHER]. Why c9uld not the Government of the United States take Mr. FLETCHER. Mr. Chairman, I have asked for this the bonds of States and ·counties as security ·and extend its tiine to addresS. the ·House for the purpose of making further own credit to them based on billions of dollars of now sterile explanation ·'of H. R. 9659, a bill to amend an act entitled gold, based on the taxing power of all of the American people "An act authorizing the Director of the Census to collect and or any other one of a dozen bases· of credit that thiS Govem~ publish statistics of cottonseed and cottonseed products, and 5302 CONGRESSIONAL ~ECORD-HOUSE APRIL 12 for other purposes." The original act was approved August DO NOT BE MISLED--HERE ARE TH1!! FACTS 7, 1916. Because of the inclusion of section 5, with penalties for This bill (H. R. 9659) recently was reported out by the nonreporting of information requested by the Director under Census Committee, and several Members of the House have authority of H. R. 9659, it is thought by some individuals made inquiry, particularly with reference to the necessity and agencies that the Bureau of the Census plans to under­ for including the general authority contained in section 2 take a large program of compulsory reporting of general in­ of the bill. The bill was introduced by Mr. FuLMER. Copies formation. This is not the case. of the committee hearings are now available. The Bureau has been very successful in securing voluntary A careful analysis of the purposes of section 2 of H. R. cooperation of individuals and establishments in the report­ ·9659 should convince anyone of the necessity for the provi­ ing of current industrial and business information and in­ sions contained therein, as the following facts will show. tends to continue these voluntary relationships. SUBJECT TO DOUBLE CHECK DR. REED'S STATEMENT Section 2 of H. R. 9659 reads as follows: Only in cases of extreme urgency, such as that which made That the Director of the Census ts further authorized, when necessary the enactment of s. 1124, would the ·Bureau of the directed by the Secretary of Commerce and within appropriations Census use the powers ·granted in section 5 for any collec­ available therefor, to collect, compile, collate, and publish, either tion of data authorized under section 2 of the bill now under monthly, quarterly, semiannually, or annually, statistical data sup­ plemental to censuses specifically authorized by law. These sup­ consideration. plemental inquiries shall be undertaken at the public expense in As stated by Dr. Reed before your Census Committee: event only that the Secretary of Commerce, after due investiga­ We prefer quite decidedly to cooperate with industry and busi­ tion, shall find the inquiry necessary to serve a broad public need ness rather than to compel industries and business to help us to of urgent nature, and shall embrace such basic statistics on in­ serve them, and our experience in this respect has been most dustrial and business activities or operations, including the quan­ reassuring. (Hearings on H. R. 9659, p. 9.) tity and/or value of production, sales, shipments, orders, and stocks of commodities, and the activity and capacity of machinery or I trust that this explanation of the objectives to be at­ plants as may be necessary. tained by the inclusion of section 2 in H. R. 9659 is adequate THIS EXPLAINS IT to answer any questions you may have in mind in regard to It should be noted that any inquiry taken by the Bureau this much-needed legislation. under provisions of this section must meet two major tests: Mr. CANNON of Missouri. Mr. Chairman, I yield 20 min­ (a) That the Secretary of Commerce, after due investigation, utes to the gentleman from Ohio [Mr. THoMJ. shall determine that such an inquiry is necessary to serve a Mr. THOM. Mr. Chairman, when attempt is made to as­ broad public need of urgent nature; and (b) that provision certain the causes of a business depression one enters a field shall be made in the Budget for each such inquiry. where there is bitter dispute and little agreement. In the - Thus an inquiry can be undertaken only after a full hear­ remarks I have to make I expect to approach the subiect.of ing- on the subject of the inquiry, wj,th business organiza­ bad times from another point of view, by discovering during tions as well as governmental agencies participating therein. our economic history what has produced prosperity in the The Congress and the Bureau of the Budget will have an various eras when employment has been good and earnings annual audit of all work undertaken under this general pro­ of all kinds fruitful. If we discover, therefore, the cause of vision, and the authority to cancel such work by disapproval a prosperous era, perhaps we can agree on the reason why of the Budget provided therefor. this particular force ceased to operate. In that way we m;ty CENSUS BUREAU CONDUCTS 59 INQUIRIES find explanation for the decline of 1938 after a significant rise At present the Bureau of the Census conducts some 59 cur­ since 1932. rent industrial and business inquiries at the dir.ection of the I find in general th~t every period of prosperity has been Secretary of Commerce under the general authority of sec­ produced largely by spectacular·activity in· a single dominating tion 8 of the Organic Act of the Department of Commerce business that made heavy demands on the basic iron and -(38 Stat. 829; U.S. C., title 5, sec. 604). steel industry. From the pace-making industry of· each A list of the current inquiries conducted under this gen­ period optimism radiated in all directions so that related eral authority is given on page 29 of the 1937 annual report and unrelated business joined in the gay procession of pros­ of the Director of the Census. perity. When then the uncommon· activity in this particu­ FOR PURPOSES OF PUBLIC POLICY lar field ran its course due to completion or to a realization From time to time special legislation directing the Bureau that investment had proceeded beyond the needs of the of the Census to secure information in certain tlelds becomes country, orders for material fell off, men were discharged necessary for purposes -of public policy. and financial crisis, or bad times, followed · as day follows The last instance of this type was the passage by the pres­ night. ent Congress of S. 1124, an act to authorize the Director of In the· formative days of the country, either expansion the Census to collect and publish statistics of red cedar or change in transportation facilities yielded the stimulation shingles, Public, No. 112, Seventy-fifth Congress. that set off business booms. Railroads were being extended Similar special acts are those relating to the gathering of into agricultural and mining areas. Money to build them cotton statistics (43 Stat. 31) and cottonseed-oil statistics was flowing from the capital reserves of Europe. Their con­ (39 Stat. 436). struction required -brawn applied to pick and shovel. There­ RECOMMENDED BY THE BUREAU OF THE BUDGET fore, great numbers of ordinary laborers were needed. As The need for special legislation on subjects of -relatively the tracks pushed into undeveloped territory, new towns minor importance so far as national welfare is concerned has sprang up like mushrooms, requiring thousands of artisans resulted in the recommendation by the Bureau of the -Budget for all kinds of construction. It was the kind of capital that an attempt be made to secure general legislation to pro­ investment that made things hum over a wide territory. vide for both voluntary and compulsory reporting of infor­ The late Senator Burton of Ohio, in his book on Financial mation according to the urgency of an inquiry. Crises, said: In transmitting the opinion of the Bureau of the Budget The most common form for the absorption of capital, as well approving s·. 1124, the red cedar shingle bill, Acting Director as the most correct barometer of activity, in the United States Bell stated: from 1848 to 1890 was railway building, which in each case reached a maximum some months or years before the occurrence It 1s suggested, however, that effort be made at the earliest oppor­ of a. crisis or the beginning of a depression. tunity to obtain the ·general legislation suggested in my letter of March 13, 1937, in order that special -individual legislation of the The first significant financial crisis swept the country in character of S. 1124 may not be necessary in the future. . 1814, when the capture of the ,Capitol in Washington by the H. R. 9659 provides the general legislation recommended by British threw us, as might well · be expected, into confusion the Bureau of the Budget. and financial despair. 1938 . CONGRESSIONAL RECORD-HOUSE 5303 The years before 1837, · when ·the next financial crisis · automobile rose steadily as a factor of national prosperity. ·struck, were featured by the construction of canals as an We shall see bow in the ensuing years this new means or alternative to the slow movement of goods by beasts of facility of individual transportation, and not the . construc­ burden. Canal shares were a favorite investment of the tion of railroads, came into the national picture as a leading public, and real-estate speculators flocked to stake out new inciter of business prosperity. The needs of transportation townsites along their routes. The Erie Canal was opened in a new form were again to dominate the business situation. November 4, 1825. Waterways were dug in Ohio, Pennsyl­ From 1920 to 1929 Canada and the United States had a total vania, New Jersey, Illinois, and other States. When these motorcar production of 30,690,744 units. These were the projects were completed, or half completed, the smash came days when millions were buying their first car. Registrations from overinvestment, and there was the inevitable adjust­ went from eight millions in 1920 to twenty-three millions in ment that follows rising prosperity. 1929. Alongside of this thrust came the most tremendous out of temporary defeat the canal builders rose again to boom of housing construction in our history-an annual aver­ continue their digging. Barely were these waterways an age of construction of 800,000 houses in the 7 years prior to assured fact when the railway-a new and speedier method 1930. Simultaneously we were lending vast sums-of money to of transportation-came into favor and sent chills down the Europe and this loaning prqgram caused our exports to rise backs of all canal promoters. Investment money rapidly . to a value of $5,000,000,000 annually. Wild and speculative changed its course, rushing into rails. The forward tide of investment of millions of dollars in rubber factories, public railroad building came to an end in 1857 and brought a utilities, real estate, and whatnot, characterized this period. sharp stoppage of business. The drawing together of all these activities stimulated com­ Following the Civil War, productive energy was busy filling mercial business to the nth degree, and it was no wonder the void left by the concentration of the past years on war that the financial explosion of 1929 was the greatest we ever needs. There was an enormous absorption of circulating knew. capital in fixed capital. Railways, as well as docks, buildings, We rode out of this country-wide depression literally on the . and factories, were constructed on an unprecedented scale. wheels of the automobile industry. Capital was flowing into objects ·not immediately remunera­ Instead of buying the alluring stock in a railway to open tive. Opening by the railroads of western agricultural lands up the West or Northwest, as they did up until 1890, the had reverberations along the Atlantic coast, where lands masses of Americans from 1932 to 1938 put their savings foimerly productive went into idleness and values fell. Rail­ into transportation equipment. An automobile was the road building had gone from a low of 1,821 miles constructed . first investment that attracted the average individual when in the· year 1859 to 7,379 miles built in the year 1871. The he saw chances of getting on his feet after 1932. His phil­ crisis of 1873 was the result of this widespread development. osophy was easy to understand. Why risk his savings in After the 1873 panic, railroad building resumed and rose stock or real.estate as he had prior to 1930, when he might from 1,711 miles for the year 1875 to 11,569 miles for the year put them into an automobile that would give him certain 1882. In this period, while the mileage of railway construc­ and substantial comfort and enjoyment? tion was greatest, it was largely made up of lines constructed Since 19.32 a steady production of automobiles, increasing in competitimi with existing lines. This fierce competitton year by year, has continued until 1938, with the total output brought receiverships and a panic of minor proportions in of Canada and the United States in the 6-year period 1884. You will note the peak of railroad construction ante­ reaching 20,000,000 cars of all kinds. dated bad times by 2 years. This upward trend, remarkable because it was· the long­ During the late eighties or nineties business expansion was est in point pf years in our automobile history, had to come of an industrial nature-more factories encouraged by favor­ to a halt, as have all other periods of expansion in sales, able tariffs and more foreign exports. Railway extension had when the buyers' needs of replacement were largely sup­ receded into the' background. Transportation facilities were plied for the 'time being, and when the field of first-car sufficient for our needs and additional outlays promised no buyers had been exhausted. dividend return. The panic of 1893 most of us remember. We are now, in my opinion, in the midst of a new kind One of the reviving factors after this crisis was the immense of business decline-an automobile depression-caused by Federal expenditures for the prosecution of the Spanish­ the temporary saturation of the country with automobiles. American War. Through the enterprise of our manufac­ Bogged down, too, is the railroad industry, hard hit by turers and inventors the year 1898, for the first time in our the competition of the automobile in an eta of "too much" history, saw an excess of exports of manufactured products transportation facilities. over imported ones. From.1897 to 1901 our exports mounted · We again see transportation regaining its old dominance by leaps, so that in l901 our foreigu trade showed one thou­ in the field of business as the pivotal industry which de­ sand four hundred and eighty-seven millions in the value of crees prosperity or hard times for all the people. exports as against eight hundred and twenty-two millions in Let us now examine automobile-production figures for this 'imports. era somewhat more narrowly. From 1932 to 1938 we regis­ From 1900 o~ to the World War we were in a period of tered in the United States 14,110,907 new passenger cars-- activity when new construction was less dominant, because 1 for almost every 2 of the 30,000,000 families in the the days of developing the frontier by railroad construction United States. We increased the total registrations from . and building. new towns bad ceased. Replacement and 20,885,814 in 1932 to 24,197,685 in 1936, and possibly to modernization of capital eqUipment came to the front. Steel twenty-five or twenty-six millions ·in 1937. The highest of all rails replaced those of . iron; pressed -.steel cars supplanted ·previous registration years was 1930, when the total was 'wooden ones; wooden bridges were giving way to steel struc­ 23,059,262. You will see, therefore, that in the period from tures; furnaces and rolling mills were modernized. All these 1932 to 1938 we added almost 4,000,000 new owners, either changes fed a steady stream of orders into the mouths of the of new cars or second-hand cars. Our whole population, steel mills. The World War, before as well as after we seating five to a car, could be riding in automobiles in the entered it, afforded the great demand for our goods that kept same instant. It should be noted that, of these 14,000,000 us prosperous to 1920. Demands for our goods had been buyers of new cars, nine or ten million of them traded in ·falling off in 1914, and the World War, it is generally agreed, old machines, which in turn were sold as second-hand. It saved us from a period of declining business. is safe, therefore, to assume that in this 6-year period all of In 1916 something of e:Pochal significance occurred. It the twenty-five or twenty-six million automobile owners now was the year of the first million production of motor-vehicle in the country will have either bought a brand new car or a units. The stimulating e:ff~t of transportation needs on second-hand· car, when the present supply of six or eight general business conditions had faded out, except for re- hundred thousand second-hand cars that is clogging the . placement of cars and rails, since the nineties. After Hn6 the market is disposed of. 5304 CONGRESSIONAL RECORD-HOUSE APRIL 12 In 1936 and 1937 alone we registered 6,888,249 new passen­ In the face of this motor-vehicle slump, due to last until ger cars in the United States, and this means that over one­ present mileage in cars is more generally used up, or until fourth of the total pleasure cars in the United States now new models induce replacement, we must look to other kinds are less than 2 years old. of industry to compensate for this decrease. Where shall In my own county of Stark, in Ohio, we sold from 1933 to we find another dominant industry that, because of unfilled 1937, inclusive, 34,294 automobiles, both passenger cars and demand on a large scale, can increase its activity materially trucks, and in 1937 the total registrations in that county were enough to affect the condition of general business? 63,918, of which 57,748 vehicles were for pleasure purposes. The answer is that in the expansion of the building­ There were in Stark County in 1930, 54,980 families, and it construction industry, especially in the field of housing, lies will be perceived that there is now registered more than one a solution of our present slow times. Business and labor, if pleasure car per family. From 1934 we increased passenger­ they are wise, will join with the Government in its program car registration in Stark County from 47,895 to 57,748 in to revive this dominant field. 1937. This meant 10,000 new automobile owners in 4 years. The annual production of houses from 1930 to 1937 was No wonder a breathing spell has come to the motor-vehicle 180,000 units as contrasted with 800,000 units in each of the industry! Millions of Americans have mortgaged their 7 years from 1930. During the lag housing has deteriorated future earnings to buy new cars and to produce the pros­ and has not kept up with the demand. Therefore, this perity of the country during the past years. but they are now industry can put millions of dollars of idle funds to work foreclosed from contracting any new obligations. They will and very effectually furnish the stimulation that is neces­ not be in the market until their monthly installment pay­ sary since automobile production has dropped more than 50 ments have been met. How many such persons are there? percent. This is an opportunity for capital and labor to The Census Bureau reports 4,263,761 cars financed by loan offer incentives to idle funds with the Government furnishing companies in 1936 and 4,199, 756 in 1937. It is also to be security through its loan-insurance program. considered that the improved automobile is capable of greater Once this giant industry is brought to full life, it will be mileage and therefore replacement is not necessary at such the dominating force that will drive us into a prosperous era. frequent intervals. Demands for transportation for the time Mr. CASEY of Massachusetts. Mr. Chairman, will the being have therefore been satisfied for millions of individuals. gentleman yield? Consumer credit that gave us the upward swing of auto­ Mr. THOM. I yield. mobile sales also financed in the same period the purchase Mr. CASEY of Massachusetts. I think the gentleman has of 6,716,911 household vacuum cleaners, 33,073,067 radio sets, made a very learned discourse on a matter of vital impor­ 9,065,535 refrigerators, and 6,894,684 wash machines. tance. In this conn,ection looking about for new pointers I There were, in 1930, 25,204,976 dwelling houses in the was interested to. read an account of Mayor LaGuardia's United States, so that we have an average of one pleasure speech made last night over the radio in which he recom­ car for each house, and in 6 years we sold an average of mended a concentrated policy of trying to get the South more than one radio to each house, one vacuum cleaner to American markets. each fourth house, one refrigerator to each third house and [Here the gavel fell.] one washing machine to each fourth house. Mr. LAMBERTSON. Mr. Chairman, I yield 5 minutes to When the motor-vehicle industry slows up, it sends pa­ the gentleman from Wisconsin [Mr. WITHRow]. ralysis through the whole business fabric from coast to coast Mr. WITHROW. Mr. Chairman, I wonder if the chair­ and from· Canada to the Gulf of Mexico. Its 45,000 agents man of the Subcommittee on Appropriations will give me are turned into men of despair. Every gasoline station is a his attention, because I ·have requested this time to ask focus point of pessimism. From .these sources go out a him a few questions. I am particularly interested in the psychological effect that slows . up every line of business. ·control of Bang's disease and tuberculosis. How much will Motor transport accounts for 6,000;000 of Our employed­ be allocated for the control of tuberculosis. and Bang's dis­ directly and indirectly-and much of this vast army of ease in the appropriation as recommended by the gentle­ workers . is quickly dissolved into idleness when a halt in man's committee? automobile production comes. Mr. CANNON of Missouri. The bill provides something in The first related business to go down is the steel industry­ excess of $5,000,000. crippled by -lack of orders just as it is at the present moment. Mr. WITHROW. How does the gentleman arrive at that· Its three best customers consume 40 percent or more of its figure? product, with the motor-vehicle industry leading by a great Mr. CANNON of Missouri. That is the amount carried margin. The exact figures of consumption for 1936 were: in the bill as reported. Automobiles, 20.3 percent; building construction, 12.5 per­ Mr. WITHROW. My understanding is that in the bill cent; and railroads, 10.3 percent. In 1937 automobile fac­ there is carried an appropriation of $1,603,000 for Bang's tories used 5,6q1,900 tons of steel-or 17.4 perce:nt of all disease and tuberculosis and that there is an une:Xpended production-with railroads second with 12 percent and the balance estimated at $6,600,000. This is for both Bang's dis­ metal-container industry third with 9.8 percent. This was ease and tuberculosis. the sixth year in which the automobile industry was the Mr. CANNON of Missouri. . The total amount carried for principal consumer of steel. A sick automobile industry this item is a little in excess of $8,000,000, to be exact, means a sick steel industry. They are inseparable in their $8,203,000. fortunes. Mr. WITHROW. That is for both Bang's disease and But steel is not all that is vitally affected. Into the motor­ tuberculosis? vehicle plants of the country go 73 percent of the plate Mr. CANNON of Missouri. Yes. The estimate was glass, 6 percent of the hardwood lumber, 17 percent of the $2,803,000 for the eradication of tuberculosis, $5,300,000 for i copper, 36 percent of the lead, 11 percent of the zinc, 14 combating Bang's disease, and $100,000 for research, or a percent of the tin, 12 percent of the aluminum, 28 percent total of $8,203,000. The committee allowed the full Budget of the nickel, 46 percent of the upholstery leather, and 9 estimate. . percent of the cotton. You will see that' agriculture takes Mr. W1THROW. I have before me the hearings that were a blow just as do the suppliers of manufactured materials held by the subcommittee and according to the hearings for automobiles. Dr. Mohler estimated there will be spent for both Bang's So, too, the railroads suffer a tremendous loss in freight disease and tuberculosi$ for the fiscal year ending June 30, 0 in the way of shipments of raw materUils for automobil,e 1938, $15,500,000. 0 factories and of finished automobiles. In 1936, for example, Mr. CANNON of Missouri. ~ He is including apparently the the railroads hauled 3,595,000 carloads of automobile freight, amount to be expended by the 2tates. The gentleman under_- 1 with an income from this source of $450,732,000. stands that this is a. cooperative expenditure. The amount. : 1938 CONGRESSIONAL RECORD-HOUSE 5305 for tuberculosis is within $300,000 of the amount set for 1938 · I represent, are · not in the position the · gentleman is to and the amount of $5,300,000 allotted for Bang's disease is cooperate and probably invest a little of their own in clearing equivalent to $12,627,600 allowed for 1938. up their herds, so they come to the Federal Government for Mr. WITHROW. This means Bang's disease has been cut help. When the Federal Government definitely embarked how much? upon a program of help, it asked for their cooperation, and Mr. CANNON of Missouri. It is a reduction of $7,327,600. now in the middle of the stream the Federal Government Mr. WITHROW. I presume the gentleman is going to take throws up its hands and says, "We cannot go any further time to explain to the House why the committee recom­ with you." I would not say a word, but we are spending mended such a drastic cut. money now for things that do not compare in relative Mr. CANNON of Missouri. No one in the House is more value with the productive value of the eradication of Bang's interested in this item than I am. It was at my suggestion disease. in 1934 that the first material appropriation was made for Mr. SMITH of Virginia. Mr. Chairman, will the gentle·- the purpose. I have lost two herds from Bang's disease and man yield? · no one can appreciate more than I do the importance of Mr. WITHROW. I yield to the gentleman from Virginia. the item. I regret the decrease but we accepted the Budget Mr. SMITH of Virginia. May I spread a iittle more in­ estimate. formation on this side in regard to the State of Virginia. Mr. WITHROW. I regret very much that the gentleman Virginia had not become aware to a sufficient extent of the has lost two herds through Bang's disease, but at the same importance of this program until this particular year. time what I am principally interested in is getting the While you had ·been working on it over the other sections of money for Bang's disease, because this· program has been the country, Virginia · had not appropriated a sufficient progressing and it has really· been productive of results. If amount of money to pay her full share of the indemnity. we do not have an adequate amount of money, it means Just last month the Virginia Legislature passed a sufficient we are liable to lose every bit of money we have invested appropriation for this year to enter fully into this program so far ·in trying to eradicate this disease which is so preva- and meet, dollar for dollar, the Federal appropriation, as­ lent in our herds. · suming, of course, the Federal Government was going to [Here the gavel fell.J carry out the program. Having appropriated our full quota, Mr. CANNON of Missouri. Mr. Chairman, -I yield the we now find that the Federal Government is going to with­ gentleman 2 additional minutes. draw, which puts us right back where we were before. I Mr. SMITH of Virginia. Will the gentleman yield? ·hope the chairman will reconsider the question of the false Mr. WITHROW. I yield to the gentleman from Virginia. economy of this move. We had better clean this thing up Mr. SMITH of Virginia. I likewise am familiar with Bang's now and get done with it, because if we do not; it is going disease from personal experience. But are we doing the to spread right on back and we will be where we were before. right thing when we start a program like this and then in the Mr. CANNON of Missouri. I am in sympathy with the middle of it seek to check it to the point where we cannot position the gentleman takes. stop the spread of this disease? As we all know, this disease Mr. WITHROW. That does hot help us, though. spreads very rapidly in many ways. We have ·gotten about Mr. CANNON of Missouri. At the same time, the gentle­ half way through this program. If we check up on it now for man is a little enthusiastic in his statement that this is the a year or two we will have to do the very same thing over only item in the bill that is cut. A large number of items again. Would not the chairman of the Subcommittee on in the bill have been cut and a substantial amount has been Appropriations consider that a cut in this appropriation for cut from the bill. the present year is false economy? Had we not better go· on Mr. WITHROW. Practically all of it has been cut right with the program full speed and get rid of this thing as we here in the Bureau of Animal Industry. did get rid of bovine tuberculosis? We have got pretty well Mr. CANNON of Missouri. Whereas up unti11934 we made rid of that. Should we not do that and cut down or stop the no provision for this purpose, we are now appropriating over spread of the disease, because it will be back in our herds $8,000,000. If we have in that time, as the gentleman from again if we do not go on with the program. Virginia has suggested, interested the State authorities and [Here the gavel fell.] induced them to ·take up the work, we are to that extent Mr. LAMBERTSON. Mr. Chairman, I yield the gentle­ carrying out the program. With the $8,203,000 here pro=­ man 5 additional minutes. vided we ought to be able to carry along the work without Mr. CANNON of Missouri. This was one of the money serious diminution. items in which a reduction was recommended. Mr. WITHROW.· I respectfully submit to the chairman Mr. WITHROW. I appreciate that fact, but it still re­ that when we inaugurated this appropriation it was not on mains the fact that if the money is not needed it will not be . the theory that we were merely going to interest the States used. but it was on the theory that we were going to go out and When we look over the Bureau of Animal Industry it is clean up this situation. Now, we are not doing it. rather amusing to find that every item concerning that Mr. CANNON of Missouri. Eight million dollars is a rather Bureau has been drastically reduced. Every one of the items substantial sum. pertaining to the control of diseases of cattle has been mate­ [Here the gavel fell.] rially reduced. Mr. LAMBERTSON. Mr. Chairman, I yield 15 minutes The committee has not addressed itself to the other items to the gentleman from Massachusetts [Mr. GIFFORD]. in the agricultural appropriation bill as it has with ref­ Mr. GIFFORD. Mr. Chairman, we should enjoy a larger erence to the items in the Bureau of Animal Industry. I may audience, but at·least today a conversational tone can be em­ say to the gentleman and to the committee that at the proper ployed in addressing those present. time I shall ofier an amendment to raise this amount to It is often said upon this fioor that during this administra­ $16,000,000, because it is necessary if we are going to protect tion no dishonesty has been proven, despite the fact that the the investment that we have already made. It is the duty C. W. A., of unfragrant memory, reeked with it, as was seem­ of the Federal Government to carry on this program 1t ingly acknowledged by the management of it. I have in inaugurated. mind the ejaculations of Mr. Hopkins in those earlier days. As to the herds the gentleman from Missouri has cleared May I call to your attention that if wastefulness, extrava­ up, he is in a position as a Member of Congress, probably, gance, inefficiency, padding of pay rolls, and all that sort of to divert a little of his salary toward clearing up his herds, thing are not dishonesty, they are close relatives of it. If my knowing the value of having clean herds. I respectfully sub­ committee of investigation would 'only sit once in a while and mit to the gentleman that my constituents, the dairy farmers inquire into the facts of the spendings carried on by this 5306 CONGRESSIONAL RECORD-HOUSE APRIL 12 administration, its findings would undoubtedly be shocking, selected individuals, and only· to those proving they have even if they did not prove actual dishonesty. sufficient income to pay. Is this Government competition My chief excuse for taking the floor so often is that I am with private capital, or not? entirely at a loss to be able to get one single meeting of the Your slum-clearance project in Washington is highly Committee on Expenditures in order that we may look into praised, but we understand that the entire capital invest­ these matters. I appealed for the help of a special investi­ ment was practically written off and rents charged at a rate gator for my office, as I am the ranking man on the minority that . will carry the property, without regard to the initial of the committee, and not the slightest attention was paid cost thereof. , to that request. All I can present to you is what I personally Yardstick! We hear much about yardsticks! Prof. Tug­ can learn in the very limited time I have in addition to that well, the starry-eyed visionary who, it is said, never had a consumed by the usual duties of a Congressman, but I do headache trying to get together a pay roll, gave birth to this not want it to be .said that I pass over these things lightly brain-child now called "Greenbelt," and to some 60 others. and make no attempt to do my duty. most of them probably worse, because Greenbelt is presented My short talk this afternoon might well be interesting to to us as the one outstanding success of the whole group. you, since I shall speak about Tugwelltown, or I should say Now we read of Mr. Tugwell being employed by Mayor La­ Greenbelt, alias Tugwell town, the model village, the ·yard­ Guardia, of New York City, to plan for him and make that stick the Government was to build so that private capital metropolis more beautiful. Why? Oh, it may be because could imitate it and build similar villages and also show how it is thought that he has the key to the back door of the they could be run at a profit. White House. Certainly he has the ear of the President. At the beginning let me say that I am most favorably im- Mayor LaGuardia was reported here last week a.S the leader _pressed by the present management of Greenbelt. It appears of the mayors desiring $3,000,000,000 of Federal funds to be to be an intelligent and conscientious management in carry­ allotted to them, and from this amount, perhaps with the ing out the declared policies. They will cheerfully answer aid of Mr. Tugwell, he would get a generous share of the all questions. "How much did this cost?" "Sixteen million money. Well, the excuse may be offered that one class of dollars/' "For how much would contractors have built citizens in New York City, the wealthy few, do pay to the this?.., "Eight million dollars or less." "Why this· excessive Federal Government a very large amount of the country's in­ cost?" "We had 1,000 on relief in the city of Washington come taxes, and the mayor may well say, "My city of New conveyed here for some time in busses. They were not able York is entitled to great consideration." to do efficient work, and it cost much money for their con­ The wealthiest city in this Nation is appealing at this mo­ veyance." ment that we prime the pump to the extent of $3,000,000,- I estimated 140 hours per month at 40 cents an hour, the 000 in such allotments. It is also proposed that we lend the. 1,000 workers on relief for a ·year, and I found that accounted States for 50 years without interest, the sum of $1,000,000,- for about $672,000, not including the transportation. With 000, and that we further appropriate one billion and a half everything counted in, not over $1,000,000 per year out of dollars for work relief. Living on borrowed funds, whether the $16,000,000 could possibly be accounted for. Seemingly, by individuals or governments, is the straight road to bank­ 50 percent of this ought to have proved of real value. ruptcy and ruin. The end thereof may not be within our "How many families have you?" "Five hundred." "How vision, but the psychology of the people will determine the many families will you have when it is completed?" "Eight end of that road, and the effects of a nation's psychology hundred." "What are your rents?" "Twenty-six dollars to come swiftly when they do come, as was the case alike in thirty-two dollars per month." "What do you furnish them 1929 and 1937. with for that rent?" "Electric refrigerator, electric stove, When our people make up theit minds that they have in and other modern conveniences go with that rent." "If you their portfolios of investment too much paper representing have 800 families and they pay you about $360 a year rental, Government debt, then the psychological moment 'will or $30 a month on the average, that is how much?" "Two have arrived and the structure of our Government will sway hundred and eighty-eight thousand dollars per year." "How in the balance. · much have you agreed to pay for taxes or in lieu of taxes?" I am making these few remarks because in the next few "About $100,000 to the State of Maryland and the county." days more priming of a dry pump is to be proposed. We "Then you have to support your schools, streets, police, and really do not need that sort of thing. We need only to re­ all the other items incident to the running of a town?" release private funds now in hiding. We ·have billions of "Yes; which is perhaps $100,000 more." "Do you keep the private funds which, by the act of our own Government is property in repair for these tenants?" "Yes." insured and lying idle in the banks, held there simply be­ The usual allowance of the Government is 5 percent for cause it is safe, since insured by the Government itself. It depreciation of real estate over a period of 20 years, and refuses to go to work and take any sort of risk. What a. calling it 3 percent on the cost of only $8,000,000, which is tragic situation it is that business and investment today go perhaps the amount it really should have cost, then you have ·up and down with the smile or the frown of the President. ·a depreciation, or an upkeep cost, of $240,000, which is almost The yoke imposed upon the Congress by him was partly equal to the entire rental to be received. loosened last week. My great worry is that some of you "Are you going to sell any of these homes?" "Oh, no; .Democrats who may fear reprisals--many truly patriotic lest someone gets in that would lower the value of the rent." Democrats in this House-will now be only too anxious to "So this is a capital investment, a total capital investment ·vote the President these vast sums that you may be rein­ ·of the Government?" "Yes." stated in his good graces: You may feel that you will fail . A yardstick for private capital! · The saints preserve us. · to receive proper allotments for your own districts unless If you visit Greenbelt possibly you will Uke the architecture. · ·you support him. But to give him more ·billions to spend Some may be enthusiastic about it, but that depressing as they have been spent in the past is giving him vastly sameness of flat-roofed houses, looking so much alike, would more powers, · and a more dangerous power, than there ever .get upon my nerves, with no incentive for beautification by · was in any reorganization bill. He will certainly control the those who do not own their homes. destiny of this Nation with those billions and you may · per­ Extravagance, wastefulness, unnecessary pay rolls is not haps feel that unless you go along with him your constit­ .classed as dishonesty, however. I wish I could think of the uents may not get their full share. Was it not sad to see ugly name that ought to go with it which woUld parallel the in the papers the pictures of some Members of the House word "dishonest." and Senate boasting about the allocations to their States? Similarly, with respect to all these housing schemes, 45 And those papers carried the story: "Of course, we must percent is given and the other 55 percent totally marked off support· the President, because of these large allotments when rentals are determined. These rentals ·are made t'o which we have secured." 1938 CONGRESSIONAL RECORD-HOUSE 5307 Mr. COFFEE of Washington. Mr. Chairman, will the have frightened away investors almost completely. I asked gentleman yield? Governor Eccles in committee this morning if he would Mr. GIFFORD. Certainly. express his opinion on a vital matter and he hesitated. I Mr. COFFEE of Washington. I noticed the gentleman can imagine why he hesitated. It is. probably because he mentioned something about Mr. Tugwell meeting a pay wanted to talk first with his chief before expressing an roll. I wonder if the gentleman could tell us of any Presi­ opinion. dent of the United States who has ever met a private pay Mr. KELLER. If the fear of the people is the cause of roll. this depression and that is the fault of the President, what Mr. GIFFORD. Oh, I am too tired at the moment to was the cause of the depression in 1929 to 1932? think whether that is true or not. I simply say to you that Mr. GIFFORD. Principally lack of money. We now have I borrowed that expression from some author who seemed .vast sums of money idle and anxious to go to work. That was to know and did not hesitate to put it in writing. You an economic depression as you know, and world-wide; but know I seldom say things that are really original. I simply now it is merely a political depression. . bring to you the thought as I see it expressed in print or Mr. KELLER . . Oh, I see. I thank the .gentleman. hear it expressed by people who have reason to know what Mr. GIFFORD. The gentleman is quite welcome. . they are talking about. Mr. LEAVY. Mr. Chairman, will the gentleman yield? Mr. KELLER. Mr. Chairman, would the gentleman yield? Mr. GlFFORD. Yes. Mr. GIFFORD. Yes. Mr. LEAVY. I always enjoy the. gentleman's remarks. Mr. KELLER. Would the gentleman tell us what he He speaks with a style that is unusual and has a -ring of would do under the conditions? · sincerity about him. Mr. GIFFORD. I would release business from the fear Mr. GIFFORD. Only a rjng? [Laughter.] of this dictatorship that we have in the White House. It is Mr. LEAVY. I think my question will indicate that to me· nothing le.Ss. He is, of course, benevolent and doubtless from what the gentleman has said it has only a ring. ·The means well, but he is one form of dictator just the same. gentleman used, and. I assume he used it advisedly, an ex­ Few business organizations and investors dare proceed. pression with reference to the President of the United Look at the public utilities. They have vast amounts of States in his remarks a few moments ago charging him money waiting to release for expansion, but will they do it unequivocally and unqualifiedly with being a dictator. Does with the Government threatening them and even entering the gentleman mean to imply by that--- into direct competition with them? Everybody should agree Mr. GIFFORD. That he is benevolent? He is by intent a that this is a political depression. The banks are full of benevolent dictator. money. There is really no excuse whatever for it. . Mr. LEAVY. Does the gentleman mean t.o imply that he The CHAIRMAN. The time of the gentleman from Mas­ is a dictator of the type of Mussolini or Hitler? sachusetts has expired. Mr. GIFFORD. Oh, no, no; he would not shoot me. I Mr. LAMBERTSON. Mr. Chairman, I yield the gentle- might talk against hiiP.but he would not have me shot. man 5 minutes more. Mr. LEAVY. Will the gentleman give us a definition of a Mr. MURDOCK of Arizona rose. benevolent dictator? Mr. GIFFORD. I will take this time so that these gen­ Mr. GIF.fORD. The gentleman is -highly educated, he tlemen .on the Democratic side may confess their failures. understands the word "benevolent." Mr. MURDOCK of Arizona. I did not ask the gentleman [Here the· gavel feli.J . to yield to me that I might make a confession to him, but I Mr. LAMBERTSON. Mr. Chair~an, I yield 3 additional am endeavoring to get some information. minutes to the ge~tlep1an from Massachusetts [Mr. GIF­ Mr. GIFFORD: Well, the gentleman can have it. FORD]. Mr. MURDOCK of Arizona. I am wondering whether the Mr. GIFFORD. Time after time ·in my pOOr way I have gentleman is quite clear on cause and effect. Which is warned about this spending _of ~illions - of dollars, mopping cause and which effect in this case? It is quite important up the savings of the people to spend on nonliquidating that we get the relationship, is it not? The gentleman _ projects. You may say: "Oh, we are in no real danger; you speaks of stagnation, and the banks being full of money, may vote this $4,000,000,000 in the next 2 weeks. The Nation ready to invest, but nothing doing, and the gentleman criti­ will not 'bust!'" I may say to the gentleman from Illinois cizes the vast expenditures by the Government. Which is who is so interested, it reminds me of the little boy who, when the cause and which is the effect? his mother said, "If you eat any more pie, Johnnie, you will As I get it from the gentleman, all we need to do now is bust," replied, "All right, hand over the pie and ·you get out for the Government to quit or abstain and business will do of the way." [Laughter.] · · the trick. I am inclined to believe that during the past 5 You will continue to eat pie and tell the Republicans to get or 6 years the Government has had to do the trick because out of the way. business has abstained. I assure the gentleman that I am Mr. MASSINGALE. M.r. Chairman, will the gentleman as hearty an advocate of private enterprise and the Govern­ yield? ment's keeping out of business as any Representative from Mr. GIFFORD. I y~eld. the northeast corner of the country, but I do feel that the Mr. MASSINGALE. I was interested in the very frank Government has necessarily had to do some things that statement the gentleman made to the effect that this is a have been done-though, of course, I hold no brief .for Mr. political depression. Tugwell or Greenbelt--and there is a vast program of con­ Mr. GIFFORD. I mean it sincerely, to~. struction other than Greenbelt that the gentleman has not Mr. MASSINGALE. Yes. If it is political, the gentle­ even mentioned. man's party must have had something to do with it. Mr. GIFFORD. I shall gradually come to many ·of them. Mr. GIFFORD. No; it was a long time ago that we were The gentleman asked me about cause and effect. I would persuasive. . · rather put it this way. Results and consequences. What Mr. ~SINGALE. Why do you not join the Democrats. are they? The results are .what you expect and the conse­ then, in getti:c.g rid of this depression instead of recommend­ quences are what you get. You have had few good .results, ing and encouraging the banks of the country to hoard this but you have had plenty of consequences. money; why do you not get with us and make them jar it Mr. KELLER. Did I .understand the gentleman to say loose? . that it is the fault of the President at the present time that Mr. GIFFORD. The gentleman is late with. his suggestion. investment is not being made? . We did _join you last week, and we will join those 108 con­ Mr. GIFFORD. Yes. I blame .him at the moment be­ servative Democrats under the name. of any party at any cause we have given him such vast powers that he seems to time. I was amused last Friday that the little pitiful minority 5308 CONGRESSIONAL RECORD-HOUSE APRIL 12 of some 80 over here should have caused the gentleman's It . was only about. 40 years ago that Henry Ford was own leaders to frighten you by tell1ng you "the Republicans tinkering in a bicycle shop in Detroit. He probably had no will get you if you do not watch out." idea this tremendous motor empire with 25,000,000 passen­ Mr. MASSINGALE. Mr. Chairman, will the gentleman ger cars, three and a half million trucks, hundreds of thou­ yield further? sands of busses, hundreds of thousands of miles of high­ Mr. GIFFORD. Yes. way lined with filling stations, hot-dog stands, and beauty Mr. MASSINGALE. Why do you not join us? parlors, would spring up. Was all this in the vision of that Mr. GIFFORD. We did last week. one man more than 40 years ago? Perhaps not. It is but Mr. MASSINGALE. Why do you not recommend to the testimony to the law and forces of progress. Yes; we have President of the United States to turn this money loose when changed a good deal. Look at the consequences and the the gentleman admits that he and his friends are now caus­ corollary changes as a result thereof. Why, there is scarcely ing the depression? a week goes by that we do not have some legislation in this Mr. GIFFORD. My friends are not causing this depression Congress that springs from the fact that the motor empire in business. needs regulation or control or that it has to be given a Mr. MASSINGALE. Yes. sense of direction. Mr. GIFFORD. No; my friends are muzzled. Change? Yes; change is eternal. .so that is one design ' Mr. MASSINGALE. The gentleman says it is a political in the pattern of the future and indicates the direction in · depression. which we are going. . Mr. GIFFORD. Absolutely. There is another design. That is, that nothing is accidental I Mr. MASSINGALE. Why does not the gentleman join us? in the universe. You may say it is an accident if you go Mr. GIFFORD. We will, on all sane legislation. In these out of the door of the Capitol and get . knocked down over ' warnings I reflect the views of many economists -in this here on the corner by an automobile. Well, Mr. Chairman, country. I reiterate, "a smile or a frown from the White I do not believe it is. Perhaps I am one of those people ! ·House and up or down go the investments and business who are devo.ted to a fatalistic philosophy, but I do _not ! activity of -the country." .believe there is anything accidental in this universe. You · Mr. MASSINGALE. Why does not the gentleman assert know, a pair of codfish could spawn enough to fill the ocean . the independence of his party? with dead fish in a year or two, but nature has provided a . Mr. GIFFORD. I have plentifully asserted my inde­ ,balance there and has provided certain destructive forces so i -pendence. that that does· not happen. There is no accident about it. I [Here the gavel fell.] It is but a part of. the ordered balance in nature. - -Mr. LAMBERTSON. -Mr. Chairman, I yield 15 minutes to If you think there is anything accidental in this uni­ the gentleman from Illinois [Mr. DIRKSEN]. ·verse, just contemplate the . solar system for a moment. Mr: DffiKSEN. Mr. Chairman, by way of philosophical . Here is the Earth. Here are Venus. and Mercury, the . in­ and introspective contemplation this afternoon, since all is ferior planets and . on the outside of .Mars, Jupiter, Saturn, -quiet and we have probably reached a new low in attendance Neptune, and Uranus. Is it not an amazing testimony to on the floor, I thought perhaps I could address a few remarks some kind of infinite wisdom that they revolve in their to the general fear and apprehension that exists in the coun­ ·orbits around the outside of the Earth. This. includes the try today as to where we are going and where we are going to .solar bodies, the Sun and Moon. They travel within their wind up. And may I express the conclusion right at the fixed orbits century after century, never colliding, capable -introduction by saying that I am not particularly alarmed, .and susceptible of_being measured to the tiniest degree. So ·because I· do believe there -is a -kind of destiny of nations as in a universe that is so delicately balanced there can be no there is a destiny of individuals. accident whatsoever. . _ A hmg time ago I think the patriarch Matthew wrote-in . A great many years ago there was a great infestation by the Good Book a question: "Why are ye fearful, oh, ye of a little rodent called the lemming over in the Scandinavian little faith?" Peninsula. . The people were worried because these little You could go on answering that just as we pleased, and in rodents were sort of denuding the-terrain. But Nature pro­ -the answer, of course, you are going to express your own .vided a balance, because they could only travel in a straight individual philosophy. But as I regard the future I think the ·line, and wlien they. came to .a . watercourse they drowned. ·pattern of our national direction can be well identified and Nature took care of that. God took care of it a long time ·can be well indicated, to dispel any fears concerning the ulti­ ago. That is further evidence that there is nothing acci- mate destiny of our country and our people. dental in the universe. . There are some designs in that pattern of progress which Do you remember when the Lowell Observatory:· some are unmistakable and they have been the designs of prog:ress years ago, pointed a telescope into that sector of the heavens ever since the beginning of civilization. If anyone wants to where over 100 years ago a French physicist · said there . go to the trouble, he can at least along broad lines sketch the would be found the remaining planet? According to Bode's future of this country and the future of the world. As one -law, there had to be another one, but they had not found it. looks at this pattern· of progress and pattern of civilization, However, they kept putting .the telescope on that sector of there are certain unmistakable designs. the heavens and finally they found the planet Vulcan. The The first design is the design of change. Ten years from astronomers, the mathematicians, and the physicists had cal­ now this country will be somewhat different from what it is .culated for centuries that if there was going to be that at the present time. Twenty-five years from now it will be harmony in this universe there had to. be another planet, different from what it is in 1938. There is nothing so eternal and sure enough there it was. That is the second design, as change in this world. as I say, in this pattern of progress. The first one is,. as I A good many years ago there was a professor over_at indicated a moment ago, there must be change and_there Johns Hopkins in Baltimore who had been experimenting will be change. .The second one is that there is no accident for a number of years, and he thought he had fashioned in .to it. Pro_gre$s springs from fundamental, well-ordered laws. the laboratory a very basic scientific truth. .Then came . Then there is another design in this world pattern, and one of his colleagues on the faculty and simply pushed over that is that the movement. is invariably-yes, always-for­ the entire thesis and the entire premise h_e .had establi$ed. ward. The world will never stand still, _and we shall not In his chagrin and in his disillusionment he tore his hair stand still. Let us go back to 1905. I think our beloved and and said, "My God, is not there anything _eternal in this distinguished ch~irman of the Subcommittee on Appropria­ -world?" One. of his colleagues said, "Yes; there is one _thing tions was probably here at the time that Dr. Wiley was the eternal, and that is change." You can pr.ove tpat for. your­ chief chemist of the Food and. Drug Administration. Cer­ selves. tainly he remembers Harvey Wiley, who carried on the first 1938 CONGRESSIONAL RECORD-HOUSE 5309 crusade for a pure food -and drugs act in this country. I · strumentality that was fashioned by our primitive ancestors went back and read some of the debates in the Senate on back in the · neolithic and paleolithic ages, as I remember that 1905 bill. You will find men who stood up in that their names. It was the spear. What was the purpose of deliberative body and, by inference and implication, said that the spear? It was a weapon of security, a weapon of de­ there was a right of private property as to the branding of fense, if you please, and a weapon of offense with which to food and what you could put into them, and if ·the buyer annoy the enemy and with which to kill animals and gain was to have any protection -at all it would · be under the a livelihood. · common-law theory of caveat emptor-let the buyer beware. What was the next thing they founded? It was the shield. We have gone a long ways since then. ·For what purpose? To find secw·ity by warding off the If you do not believe that; read through the pure foed and attacks of their adversaries. The very first thing the orig­ drug bill that is pending in the Committee on Interstate and ·inal mind or primitive mind invented was an instrumental­ Foreign Commerce at the present time, which, if it does not ity of security. become law this-session, will no doubt be on·the law books of After awhile, as I recall my ancient history, these indi­ next session. That will indicate to you that we have gone viduals developed families, the families Goagulated into forward in our thinking and in our conception of the func._ tribes, and the tribes wandered around until they settled tion of government in relation to public health and welfare. down into a communal life in the very lush and fertile val­ Change. -leys of. the Tigris and the Euphrates Rivers. ' There was a I went back into some old books and mag~zines w~ch were reason for that. There was no accident about our· ciViliza­ published shortly after the Civil War. i am sure the gentle­ tion beginning there. That was because of the vegetation woman -from New York will have some recollection of the there, the berries and herbs. It was a place capable of Godey's· Lady's Book and Graham's Magazine. -My wife's sustaining life, and also of sustaining their livestock, with grandmother had a set and I used to rummage through them. subsistence for their families, their· goats, horses, and sheep. You know, I found a delicious editorial there by some om­ That is where our communal ci·vilization began. niscient gentleman who started off-in this fashion. - He s~id · After they were established there, what was one· of the the natural ·delicacy a:t;1d modesty of the opposite sex was first- things they did? They set up this colony and put a such that they would ·frankly refrain-from ever entering ·into ·big ·wall' aroUnd it. Why? Fer the purpose of finding se­ the field of public life and ever wanting to take to them­ curity against marauding tribes. selves the right of the exercise of suffrage. -· After he got off I was in Europe during the war, and I used to marvel at -that choice morsel of wisdom; here ·ladies became members of the beautiful castles they had, and the· country . chateaus, legislatures and of the Congress; they became straphangers in -in many cases with the original moats filled with . water, -streetcars, ·and they began to function ·tn all the fields of with the old drawbridges, that probably have not been let ·human enterprise. So this-bit of static ·wisdom the gentle­ down for ages and ages, still there. These were evidences bf man uttered a long time -ago was just brushed off to one ·side the medieval days when men built these ·great ·fortifications -and your sex-God-bless them-millions of them·, ·have moved ,for ·family -use and then surrounded theni with• protective forward and taken ·their rightful place, despite the fact that instrumentalities in order to keep out their· enemies. · The ·mere man ·got it into his mind that conditions were· static, impulse to security has always been there. that you would not move forward, and that you would always Then, look in some other fields. Here. were the· barons be working in the kitchen and never take your place in the and the commoners who presented their demands to King public pursuits of this ·country. · · John at Runnymede in 1215, as all you historians will recall, Yes; the movement is forward, and I do not care to what and· secure·d for· themselves the Magna Carta. What . did field you turn your attention you will find ·that the move­ they do there? They·received from the King certain rights ment is always forward in our civllization. · and certain concessions. Why? In the interest of the se­ The · debate on yesterday on the· proposed · income tax for ·curity of their liberties. - ·the Dlstrict of Columbia brings to mind the early struggles · Look at the security of conscience and think of the hun­ of our congressional predecessors· to enact a Federal income dreds of thousands of people whose lives had to be snuffed tax. In 1895 Joseph Choate, ·the eminent barrister, ·stood out, as; for instance, in the massacre of St. Bartholomew's before the supreme Court of the United States and solemnly Day in the medieval days of France. What for? All be­ argued how this tax would destroy the Nation, how it con­ ·cause they were insistent upon the integrity and the security stituted communism· and devilism, and with what fear and of their consciences; and that, of course, -ran . athwart the trembling the people of this good land were contemplating ruling power and the ideals of the ruling power. the action of the Court. Poor, misgUided Choate~ . How [Here the gavel fell.] little he discerned that, despite all his eloquence · and legal Mr. ~ERTSON. Mr. Chairman, I yield 10 additional ability, the course of civilization was forward, not backward, minutes to· the gentleman from Dlinois. and how relentlessly and completely his notions were brushed Mr. DIRKSEN. So by virtue of the desire to·effect security aside, for only 18 years later the people sanctioned an amend­ of conscience the world moved on and on and on until our ment to the Constitution to make incomes taxable.· Oddly forefathers wrote into this Constitution, that we discuss day enough, that has been followed by income-tax laws in; a after day, those guaranties in the Bill of Rights, to worship score of States, and to those misguided in· the District of according to the dictates of your own conscience; yes, security Columbia, who beli-eve that there· Will be no income tax for of conscience: ·It ·is one of the things that has impelled us this District, I merely suggest that they examine history and along the course. .Security of the press; security of that be edified.· A tax based on a bill ty to pay is founded iii sound right of freedom of speech. · Oh, it is all there. morals. The forces of progress will not permit a handful of · And then· they also made certain of the security of pro·p­ undiscerning· and slightly· selfish folks to stand in the way. erty. Our forefathers were not unmindful of it. If you . Time will teach -them the proper lesson. · think· they were, you should examine and reexamine the due­ · Then the fourth design, and the most important design­ process clause in the Constitution. ·You will fmd that that and, of course, I will get up to this· bill iii the next hour or clause m·ade more legal history and more judiciar history two, I expect-is the design of security. You lock at the than any other clause in the Constitution. . 'Why? Because work we have been doing in this Congress and in' the pre­ they were going to be certain, since property is one of the ceding Congresses and at the general implications of this essential adjuncts of civilization, that there was security bill, and there you will find· this design of security that ruh& of property. S::> they said ·you could not take away a man's through -the whole course of human civilizati'on. · ·u you property rights Without due process of law: Yes; the impulse do not believe it, let us go back to· the original beginnings: to security was upon our forefathers, just like it is upon us Let us go back · to the cave age. · Wluit was the first in- at the :Present time. · · · LXXXIII--335 . 5310 CONGRESSIONAL RECORD-HOUSE APRIL 12 Let us look at the field of antisocial tendencies for a our subsistence. Here is the Japanese beetle. We have moment. If you want to see evidences of the impulse for spent millions of dollars on it, have we not, Mr. Chairman, security there, stop to consider that when the Department and we have not controlled it yet? Some might very well of Justice appropriation bill is before us we appropriate for say, instead of having an agricultural adjustment program the maintenance of-I do not know how many-50 or 60 whereby we pay cash for com that is not produced and pay Federal prisons in the country, for the enforcement of the cash for hogs that are not produced, why not just turn the laws, for the payment of salaries of district attorneys and country over to the bugs for a little while, and they will do jailers and commissioners and United States marsha],s, and a first-class and a forthright job? This sounds very plau­ all the rest. What is it? WhY, it is nothing else except our sible, but, gentlemen, we would not dare do this, because the collective national effort to preserve security of person and bugs would move in and never would move out. Do not be property in this country against those who may have anti­ fooled about that. Our very national subsistence would then social tendencies and who forget where their rights end and be in peril. your rights begin. So here is this work going on year in and year out, for In the field of physical security, the whole country is which we are spending millions of dollars, but how necessary dotted with sanitariums and hospitals and clinics and life­ it is in order to preserve our subsistence and give assurances extension institutes and all that sort of thing, designed to of future food security. do what? To preserve physical security and give some pros­ Here is an item in this bill for the elimination of diseased pect of physical longevity. It is an impulse to security, the cattle. WhY? Well, you do no·t want the infants of this most important design in this pattern of progress, as I country to be drinking milk from diseased cattle. call it. You do not want our people to be subsisting on meat from Now, we will get down to this bill. In following out this diseased cattle, so here is Uncle Sam going ahead with in­ pattern of security or this design of security, we are not spection· and quarantine, trying to remove these infected unmindful of the fact that we have also got to make secure cattle for the purpose of security of the livelihood and wel­ the subsistence of our people if we, as a nation, expect to f~e of the country. The same thread· and the same pattern subsist and endure, and the bill we bring before you today, run through all the activities of the Bureau of Animal In­ the appropriation bill for the Department of Agriculture, is dustry, and Forest Service, the preservation of our forests, high testimony to that whole idea of finding security of our not only against forest fires for which we appropriate hun­ S\lbsistence. dreds of thousands of dollars, but also for the preservation First of all, we appropriate in this bill for the Food and of those forests against blister rust and white pine blister Drug Administration, for men to go out and make inspec­ and Dutch elm disease and all the diseases that seem to be tions to see that food and drugs are not misbranded or known to mankind that are afHicting and affecting our forests adulterated, to see that they are not deleterious to human and making insecure a sumcient and adequate supply of health and human welfare. Is not this security? Uncle timber in the future. Obviously in all these things we cannot Sam stands in the position of a great mentor who says to go as far as lots of people would like to have us go, but there every producer of foods and drugs, "I am standing in the you see constantly this whole design of security that some­ shadow to make secure the health of the people of this how runs through the pattern of things, and very particularly country insofar as I can." So you have the Government through the activities that go on in the Congress. standing in the position of assuring health security to its Finally, I might mention soil erosion. I did not take so people. · kindly to the idea for a long time. I thought it was a waste We appropriate in this bill for the Weather Department. of money. I thought it was a waste of money to be plowing Have you any idea what this embraces? Well, it embraces contour furrows and all that sort of thing on land that was probably 1,500 people, observers, technicians, and scientists bleak and as red as an Irishman's red flannel nightshirt and who are scattered all the way from Alaska to Florida and that gave no prospect of being productive anyway. You from the Atlantic· coast out to the Pacific coast and even out know there is going to be a lot of people living in this country upon the ocean. What do they do? They telephone warn­ long after we have passed from the scene, and so we have to ings when a storm comes up. They coordinate their efforts do something to preserve the fertility of this country and in so with the Commerce Department so that airplane pilots do doing we are only giving testimony to the impulse of security not leave the ground with the precious lives of people if for our own generation and generations to come. there is danger of losing those lives. They send out frost Mr. DICKSTEIN. Mr. Chairman, will the gentleman warnings to people who are growing oranges in Florida and yield? in California, so that if there is a frost on the way they can Mr. DIRKSEN. Yes. start the smudge pots and the smoke machines and tlle heat Mr. DICKSTEIN. The gentleman talks about bugs. We machines so the oranges will be protected. They have have a lot of two-legged bugs in this country. stream-gaging stations all up and down the Ohio, the Mis­ Mr. DIRKSEN. Oh, please! sissippi, and the Illinois Rivers-for what purpose? When Mr. DICKSTEIN. Who are more or less destroying the there comes a sudden freshet and there is danger that great democracy more than the bugs the gentleman speaks of. volumes of water will destroy the lives and the property of The CHAIRMAN. The time of the gentleman from Illi­ people living in the lowlands, they telephone oii ahead. Yes, nois has expired. Uncle Sam is sending a message of security. to somebody in Mr. LAMBERTSON. Mr. Chairman, I yield the gentle­ the lower reaches of the river through the instrumentality man 5 minutes more. o( the appropriations we make in this bill. Mr. DICKSTEIN. The-gentleman is making an excellent Then there is the Bureau of Entomology and Plant Quar- speech. . antine. You ought to read the justifications from the De­ Mr. DIRKSEN. The gentleman is just reminiscing a little. partment some time. I had no idea we had so many·bugs Mr. DICKSTEIN. I wish the Department would find some and bacteria and insects and pests and one thing and an­ medicine for the two-legged spies and bugs that are rotting other in this country or in the entire world as they have the country almost daily. · cataloged in their justifications. Mr. MURDOCK of Arizona. Mr. Chainnan, will the gen­ Mr. DICKSTEIN. Mr. Chairman, will the gentleman tleman yield? ~~ . Mr. DIRKSEN. Yes. Mr. DIRKSEN. Let me continue for just a moment. Mr.' MURDOCK of Arizona. · I have enjoyed the gentle­ Here are these devoted scientists and fellows down in the man's scholarly address and wa.s about to remark that it Department of Agriculture looking through microscopes, was a hopeful sign and a joyous thing to hear such an fooling around with these tubes and beakers and Bunsen expression coming from my colleague from the other side burners and all the equipment of a laboratory-what for? of the aisle. I gather from the gentleman's first remark To be constantly keeping ahead of these things that menace that he is not willing to sell America short? 1938 CONGRESSIONAL RECORD-HOUSE 5311 Mr. DffiKSEN. No; I am not. ward; and as we have moved forward, of course, we en­ Mr. MURDOCK of Arizona. Regardless of the man or counter new problems. It is silly to say that we ought to the party in control in the White House. I notice a little be ba11led by these problems. They ought to inspire more further on that the gentleman spoke of a forward movement resolution, more courage, more patience, and more tolerance being the only movement known to nature and to economy. on the part of everybody to find the solution. To me it is Mr. DffiKSEN. That is a scientific truth. rather amazing when we get right square up against a new Mr. MURDOCK of Arizona. Does the gentleman believe problem that has no element of partisanship or politics how that we cannot ourselves politically or economically turn easily we vitiate party lines and stand up like so many citi­ back, for instance, 20 or 30 or 40 years, and that he is not zens and patriots of a common country in order to find the Willing to attempt to do so? right kind of solution. We have got to preserve more and Mr. DffiKSEN. Oh, there is a lot of latitude in the con­ more of that attitude if we are to find the solution. struction and interpretation of whether we turn back, and [Here the gavel fell.] if so, how, but no matter what we may do, we will move Mr. LAMBERTSON. Mr. Chairman, I yield 5 additional forward just as inevitably and relentlessly as the very march minutes to the gentleman for his rhythm. of years. It cannot be any other way, because if there was Mr. DffiKSEN. For my what? anything about this backward motion, then surely you ought Mr. LAMBERTSON. For the gentleman's rhythm. to have somewhere in the heavens a retrograde motion of Mr. CANNON of Missouri. Mr. Chairman, I yield 5 minutes the planets, and that has never been known since the be­ to the gentleman from Illinois. ginning of time. Mr. DIRKSEN. I am simply overwhelmed. Mr. EATON. Mr. Chairman, Will the gentleman yield? Mr. BOIT..EAU. Mr. Chairman, will the gentleman yield Mr. DffiKSEN. Yes. to permit me to make a practical application of his Mr. EATON. Just to correct his knowledge of the Bible. philosophy? He speaks of eternal motion. The gentleman has forgotten Mr. DffiKSEN. I yield. Joshua. Mr. BOILEAU. The gentleman talked about moving for­ Mr. MURDOCK of Arizona. Mr. Chairman, the gentle­ ward. I would like to point out that, moving in that direction, man is comparatively a young man in spirit. we sought to prevent the cattle owned by the farmers of this Mr. DmKSEN. Oh, the gentleman would be surprised to country from haVing Bang's disease. More and more assist­ learn how old I am. ance was given moVing in this forward direction, and we have Mr. MURDOCK of Arizona. Does the gentleman not feel tried to eliminate Bang's disease by appropriating money. I that we are living in another, in a new age, different from am wondering, however, if we are carrying out the gentle­ that of 1928? man's philosophy of going forward when in this bill we do not Mr. DffiKSEN. No age is new. History, after all, is a appropriate a sufficient amount of money to insure that continuous pattern. It is like a floWing ribbon. You can change being put into e:ffect? Does not the gentleman think mark o:ff various portions of it and say this is old age and that this is an illustration? The reduction in the appropria­ this is new age and this medieval, but it is not so. It is tion for the elimination of Bang's disease is certainly not just a ribbon moving forward constantly. There is nothing going forward, it is going backward. Does the gentleman new or old about it. It is but a record of continuous and think it is a proper step under his philosophy? moving experiences of htunan kind as they are impelled Mr. DffiKSEN. I think my own philosophy is quite in har­ forward by basic forces. mony With the viewpoint that has been expressed by the sub­ Mr. MURDOCK of Arizona. But great changes have oc­ committee and the committee from time to time. The for­ curred since 1928. ward movement is a progressive movement. You do not take Mr. DffiKSEN. Yes; and change is eternal. a forward step all at once any more than a newly born babe Mr. MURDOCK of Arizona. The gentleman seems to in­ throws back its shoulders and starts out on a brisk walk down dicate that there must be an expansion of government such the Avenue; no, indeed; we have got to advance a little at a as the gentleman recognizes in this bill, and increased time. We cannot know if all these things Will work out suc­ expenditures, and all that. The gentleman would not dimin­ cessfully. If we tried to meet the desire of every Member of ish governmental expenditures, but would, rather, increase this House and of the senate in respect of changes we would them, according to the tenor of this legislation. break the Federal Treasury overnight. You cannot overlook Mr. DffiKSEN. The gentleman means whether I favor those very definite earthly limitations, those very material this bill and the appropriation? considerations that we as legislators have got to have in mind. Mr. MURDOCK of Arizona. Yes. The gentleman will admit that we have made great progress Mr. DffiKSEN. Oh, I do. I had a chance to pass on in that field, first of all, in bringing about a reconciliation these items in subcommittee. While there is a little differ­ between Government philosophy and policy. We try to create ence of opinion in the comtuittee between the members, security. We appropriate money to eliminate bovine tuber­ essentially they realize that in a country that is growing culosis and Bang's disease, to reimburse the farmer some­ numerically, grow~ng in importance and in the magnitude of what. We are making great progress in the whole field. So its problems, you have to spend some money in order to meet many of these things are direct and substantial. those problems. Mr. BOILEAU. But does the gentleman think we are going Mr. MURDOCK of Arizona. Then, Mr. Chairman, I be­ forward in the matter of eliminating Bang's disease when we lieve the gentleman and I are in perfect agreement on the cut down the appropriation to carry on the program? Does so-called great modern trend in our Government.' We must not the gentleman think· we are endangering the progress we ·increase governmental expenditures. It is not so much the have made? idea of cutting down as it is achieving true economy in that Mr. DffiKSEN. -No; for the reason that Dr. Mohler, who, ·the taxpayers' dollar Will yield more. in my judgment, knows-more about-this matter than anybody Mr. DffiKSEN. I think I told this House once before that else, believed that if we had to make sacrifices we could make a little over 40 years ago, when I was born-that is a public them here.better than in something else. confession-! think the entire expenditure for government Mr. BOILEAU. But be recommends the additional appro_. was only $390,000,000. That included everything; that in­ priation, does he not? cluded the Army, the Navy, the Department of Agriculture, Mr. DffiKSEN. He recommends that if money were avail­ the Department of Justice, the Post Office Department, the able :for ,this -purpose without imperiling the fiscal set-up Treasury Department, the State Department; it included t~t it would be a very desirable thing to use it for this ·everything-$390,000,000, for round figures let us call it $400,­ purpose. ooo,ooo. Here today we are into the billions, $7,000,000,000, Mr. BOTI..EAU. This expert of whom the gentleman $8,000,000,000, $9,000,000,000; yes, it is only testimony to the speaks, and in his statement I agree- tact that the ccuntry has grown, that we have moved for- Mr. DffiKSEN. John R. Mohler. 5312 CONGRESSIONAL RECORD-HOUSE APRIL ·12

·Mr. BOILEAU~ Recommends the appropriation of more different varieties in the field and mixing of the seed in the · gin inoney to carry on this program than the committee has were known to be two of the principal causes of the poor quality of much of the crop and the simple remedy for this was to restrict included in the bill. production in each district to only one kind of cotton. In this way Mr. DIRKSEN. He said that, of course, it could be used. the seed of the better varieties could be kept apart and pure, the Progress is a matter of evolution, it must come step by step. fiber k.ept more uniform. and the improved staple prOduced in even running lots which would command better prices from buyers and If we included in these bills every suggestion made on every manufacturers. subject we would give the people a bad case of legislative Efforts were made to establish one-variety communities in several indigestion. S~ates of the Cotton Belt, notably Texas and North Carolina, but difficulties were encountered in organizing these communities on a Mr. BOILEAU. Does not the gentleman believe it is large scale, and when better prices were not received for the small wiser to take one forward step along the way than two lots of improved fiber the farmers became discouraged and gave up or three faltering steps? the effort. There seemed no way- of getting a start in a community in the main Cotton Belt in producing the quantity of better cotton Mr. DIRKSEN. We must move forward on all fronts necessary to give farmers bargaining power to demand better prices. and in a practical way. In this rambling dissertation on the During this time, however, cotton prOduction was extending west­ designs in the general pattern of human progress, I am not ward into the irrigated valleys of the Southwestern States, where insensible to the practical consideration that must be con­ the farmers knew the value of standardization in agricultural com­ modities, learned through the successes in the cooperative produc­ stantly borne in mind. The world is a practical and real­ tion of fruits, vegetables, etc. It was a comparatively simple matter istic place. This Congress is and must be a practical body to convince these farmers of the advantages of standardization as and in its articulation of the things which make for progress applied to cotton, and because of the isolation of these valleys an excellent opportunity was afforded to put on a large-scale demon­ and which are ·highly desirable in perfecting the condition stration of one-variety prOduction. of the Nation and the circumstances of the people, we must The first such community was in Arizona; with Egyptian cotton, have a regard for the maintenance of economic balance shortly before the World War. This was a success from the ·be­ and for our fiscal condition. ginning and for several years the American Egyptian industry represented the largest single lot of pure cotton seed in the world. Is it not perhaps a wholly justifiable criticism that in the In 1919 the Egyptian crop in Arizona was valued at $20,000,000. fonnative years ·of the present· administration's policies, we Closely following the Egyptian development, the one-variety cot­ moved so fast and required such a vast amount of adjust:.. ton idea was established in the upland cotton area of California. of • • • Other upland areas in California, Arizona, and New ment that the country fairly suffered from a species Mexico joined the movement a little later, and within a few years legislative indigestion? It looks logical that a whole nation practically the entire production of these three States was stand­ like an individual can take about so much medicine at one ardized. The growers in California believed so strongly in this time and no more. Too much medicine would be as harmful idea that in 1925 the State legislature passed a one-variety law designating certain valleys in the State as exclusive one-variety as no medicine at all. areas, and made it a misdemeanor to· plant any other kinds of cot­ And that thought brings me back to the pending bill. ton in those districts. These practices have continued in this For weeks and weeks, the subcommittee has taken testi­ area up to the present time, and· the Department of Agriculture mony, considered and discussed the various items in this has pointed to them many times, with considerable pride, as demonstrations of the possibilities of cooperative effort in cotton measure to bring you a balanced bill, to do equity to all, improvement. and still -preserve a regard for the recommendations of the Budget Bureau. We trust that this painstaking work will In 1935 there were 343 one-variety cotton communities in merit the approval of this House. the Cotton Belt. Last year-1937-there were 814 such com­ Mr. CANNON of Missouri. Mr. Chairman~ I yield such time munities. In 1937 the one-variety communities produced as he may desire to the gentleman from Texas [Mr. MAHoN]. 1,863,692 bales of cotton-about one-tenth of the entire Mr. MAHON of Texas. Mr. Chairman, during the discus­ American cotton production. sion of this bill, which has to do with the Department of In Texas in 1937 there were 156 one-variety cotton com­ Agriculture, it is not inappropriate to· refer to the one­ munities. These one-variety communities were located in variety cotton community program which is being sponsored 86 Texas counties. The fast rate of expansion of this work by the Department, and which is being well received in many in Texas is emphasized by the fact that 3 years ago there sections of the Cotton Belt. Very little money has been spent were only 31 one-variety communities in Texas. in· this work by the Government, but fine results are being This standardization of the grade and staple in cotton pro­ achieved by this program. duction will not by any means proVide an adequate price In that connection let me quote the following from a speech for cotton, nor solve the cotton problem, but it is sound from made some time ago by Assistant Secretary of Agriculture every standpoint and should be encouraged by every possible Harry L. Brown: means. At this point I wish to give briefly a review of the one-variety Mr. C. B. Doyle, in the Department of Agriculture, is co­ cotton work, with special reference to that part played by the Department of Agriculture. It was in 1908 that the Department operating with various States and communities in this work tlrst recommended this plan as offering the best outlook for perma­ and I am inserting a table prepared by him ·which will be nent improvement in the quality of American cotton. Crossing of interest. One-variety cotton prod.uctton, by St(l.tes

' 1935 1936 1937 State Counties c~1W~u- Acreage p~~~;:c- Counties c~~:u- Acreage Produc­ Counties C~~:u- Acreage Produc­ tion tion ------'------~--1------1-----1-----1----~---·1----·1-=--- Alabama______. 16 - 21 10, 000 5, 000 31 74 40, 000 20, 000 37 89 55,000 28,000 Arizona______li 11 69,700 66,700 li 13 93,850 86,080 . 5 13 120,000 118,000 Arkansas------26 74 210,160 100,785 30 88 212,672 130,943 California.----~------9 9 205,430 229,694 8 8 347,800 429,656 8 8 589,000 688,000 Florida 1_ ------3 3 716 175 5 5 4, 043 828 8 8 19,061 3,128 74 162 303,505 175,8~ ~~i~l:na======~~======------~------~~- --~~~~~- ---~~~~- ~~ 13~ 2~~: ~ 1~: ~ II 25 100,000 50,000 Misl'issippL .. ------·.r------46 110 124,409 62,204 48 126 193,064 119,471 49 160 251,735 166. ()()() New Mexico______5 7 00,000 75,000 5 7 116,000 111,000 5 7 144,000 157,000 North Carolina ______. _ 6 10 21,000 10,500 7 13 34,000 24,500 7 13 39,000 31,000 Oklahoma __ ------7 12 46,500 15,500 8 10 14,210 1, 486 7 9 9,623 2, 600 South Carolina______3 5 18, 000 9, 000 6 8 66, 500 47, 000 6 8 82,500 59,000 Tennessee ______------~------20 68 111,920 55,960 Texas.------7 31 78, 000 39, 000 10 32 lfiO, 000 75, 000 ' 86 166 396,351 198,176 TotaL ___ ------:----- 162 . 3-43 815, 035 583, 413 225 612 1, 661, 833 1, 157, 2'l:l 343 814 2,434,367 1, 863,69:1

I Sea island. 1 Parishes. 1938 CONGRESSIONAL RECORD-HOUSE 5313 Mr. CANNON of Missouri. Mr. Chairman, I yield 1 minute the roll of the W. P. A. reveals that the great bulk of the to the gentleman from illinois [Mr. DmKsENl. enrollees come from two groups, the first group being the Mr. DffiKSEN. Mr. Chairman, I want to announce that tenant farmers, and I am told by the Agricultural Depart­ for the first time in my experience since 1933, the Progressive ment that 53 percent of the farmers of this Nation are Party, the Republican Party, and the Democratic Party have tenant farmers. The remainder come from that other group, all been on the same side of the aisle this afternoon. the wage earners, who are unemployed by virtue of the de­ [Applause.] pression and the existence of substandard conditions. Mr. CANNON of Missouri. Mr. Chairman, I yield 15 min­ I feel sure that the most intelligent course for us to fol­ utes to the gentleman from Missouri [Mr. WooD]. low would be to appropriate a sufficient amount of money Mr. WOOD. Mr. Chairman, I am very deeply interested so that at least a reasonable portion of the tenant farmers in one portion of this farm appropriation bill. I refer to the of this Nation may have the opportunity to acquire a farm section having to do with farm tenancy. I am mighty glad and home through financing by the Government. that the Congress came to the realization finally that we In my district there are nearly 12,000 tenant farmers. should come to the assistance of the farm tenants of this Since this law has been enacted not one single tenant farmer Nation by the enactment of the farm . tenancy law during in my district has received a loan which would enable him to the last session of the present Congress. secure a farm. We have in my district, in the State of Mis­ In the second session of the Seventy-third Congress, in souri, and throughout this Nation, of course, thousands of 1934, I introduced a farm tenancy bill carrying with it an landowners who are ready, willing, and eager to sell their authorization for $500,000,000 for the purpose of enabling the farms at a reasonable figure to tenants or to anyone else, and farm tenants of this Nation to acquire farms and homes we have millions of farm tenants and sharecroppers who de­ through Government financing. I was told when I introduced sire to purchase a farm and home, but as we all know, that this bill that this was the first time that legislation in the class of people, who are the salt of the earth and among the interest of the tenant farmer had been presented to Congress best of our American citizens, due to their peculiar economic since the passage of the homestead law. surroundings, are never able to acquire enough over and In the Seventy-fourth Congress I introduced a similar bill, above the cost of their mere subsistence even to make a down which was known as H. R. 5603. In that Congress, however, payment upon a farm. Therefore, if we should appropriate the gentleman from Texas [Mr. JoNEs], chairman of the enough money to give a reasonable number of tenant farmers ·Committee on Agriculture, also introduced a measure, which an opportunity to buy, through Government financing, a was a companion bill to the Bankhead bill introduced in the home and farm at a low rate of interest, it would have the Senate by Senator BANKHEAD. I am mighty glad that legis­ effect of taking such tenant farmers off theW. P. A. rolls and lation has been passed. the relief rolls. After all, we must provide for .their security In the Seventy-fifth Congress, in .1937, when that bill was some way. I am in favor of appropriating any amount of passed, I also reintroduced my farm tenant bill. money to bring comfort and security to the people of this There is one feature about the law, however, that I do not Nation. like. We passed a law to provide for the purchase of farms The enactment of the farm tenancy law of 1937 engendered and homes by tenant farmers, but section 6 of that act a great hope in the hearts of the tenant farmers that at last provides only $10,000,000 for the fiscal year ending June 30, they would be able to realize their lifelong aspiration to be 1938, $25,000,000 for the fiscal year ending June 30, 1939, and able to purchase a farm home and to enjoy that measure of $50,000,000 for each year thereafter. security that flows from the. ownership of a home, through Mr. Chairman, a year has passed since that measure was loans by the Federal Government at low rates of interest and enacted into law, and in the State of Missouri just a week long-term credit, but 99 percent of the tenant farmers of ago the first loan to a tenant farmer was made in St. Charles this Nation have been doomed to bitter disappointment due County, Mo., and out of this first year appropriation of to the failure of. the Congress to provide ample appropriations $10,000,000, Missouri has been allotted only 53 loans for the to carry into effect the provisions of the law. I am going to 114 counties in the State, and those 53 loans will be made in present an amendment to the present appropriation now 8 selected counties, averaging about 6 loans for each under consiQ.eration, when the proper time comes, to raise .of the 8 counties selected and none in the other 106 counties the appropriation of $15,000,000 for the fiscal year 1939, as in the State. suggested by the Appropriations Committee, to the original The $10,000,000 provided by that bill was a mere drop amount of $25,000,000, as fixed in the original law. I am in the bucket, and even though we would secure this year going to press for the passage of my bill, H. R. 9914, which the maximum of $25,000,000 for the fiscal year 1939, it would provides for an appropriation of $200,000,000 for the fiscal enable the lenCling of money to only a negligible number of year 1939. We are appropriating millions and billlons of tenant farmers in each State, and only an average of slightly dollars to all types of commercial and business enterprises, more than one loan to each county in my State. with and without security, at low rates of interest, and accom­ I introduced a bill during the present session, known as panying many of the loans with grants which do not even H. R. 9914, which provides for an appropriation of $200,- have to be repaid, and I cannot understand why we cannot 000,000 for the fiscal year 1939. I realize it is impossible to appropriate sufficient money to loan to honest tenant farmers secure an appropriation in excess of $25,000,000 in this ap­ at fair interest rates, when we know that the loans will be propriation bill, because the enactment of the farm-tenant secured by the land, the best security on the earth. law of 1937 limits the appropriation by the Congress to In a few days we will have a recommendation, as I under­ $25,000,000 for the next year. However, the Appropriations stand, that $1,250,000,000 be appropriated for the perpetua­ Committee has only recommended $15,000,000 for the fiscal tion of.the W. P. A. for the first 7 months of this next fiscal year 1939. year. I am going to vote for that appropriation. I do h<;>pe Mr. Chairman, we have been authorizing the expenditure of it will be possible, however, in view of the fact we cannot millions and billions of dollars for all sorts of relief and I appropriate over $25,000,000 to enable the tenant farmers to have voted for every such measure. I voted for every purchase farms and homes, that when this bill comes up for measure that sought to assist and stabilize business. I voted consideration under the 5-minute rule we may be able to for every measure having to do with the creation of the amend the bill and raise the amount of $15,000,000 sug­ W. P. A., the P. W. A., the Civilian Conservation Corps, and gested by the Committee on Appropriations for loans to the other relief measures. But, Mr. Chairman, we seem to tenant farmers to the maximum amount authorized by the have forgotten the great· necessity of bringing to the farm law--$25,000,000-for the fiscal year of 1939. [Applause.] tenants of this Nation that measure of security which will Mr. CANNON of Missouri. Mr. Chairman, I yield 15 min­ make for better citizenship. It is .·a well-known fact that · utes to the gentleman from Illinois [Mr. KELLER]. 5314 CONGRESSIONAL RECORD-HOUSE APRIL 12 WAGES AND HOuRS • purchasing power with which to buy the things created by Mr. KELLER. Mr. Chairman, I am going to speak briefly labor. In former years investors were satisfied with 6 percent about labor and wage and hour legislation. We cannot ad;. and security, but the gambling in the industry of the country journ and escape' our responsibility, and we cannot go home has often won such fabulous returns that the big-business and ask the people who sent us here to send us back to do nien are not content with anything less than a multiplication · the· things we should do while we are here. of 6 percent. And to get such returns they exploit labor out We have no righf to permit labor to drift deeper into of its fair reward and rob the consumer of a fair price. The poverty. We have already permitted a few industrial leaders failure to recognize this will lead us far afield in our attempt and owners to enrich themselves at the expense of labor.· Mr. to revitalize the industry of our country on a permanent basis. Barney Baruch ·says the administration is partly responsible No one knows better than Mr. Baruch that watered stock, for the timidity of business leaders and their reluctance to monopoly prices, excessive profits, and low wages have again release and use their money to revive business. created new idle surpluses of money that are wrecking our I am going to name some of these- business leaders whose markets. destroying the buying power of our people, and timidity is supposed to be keeping them from cooperating throwing the workers out of their jobs. With the administration in reviving industry. They are the Is this administration responsible for the automobile in­ same group who, through Mr. Baruch, are pleading for dustry grabbing from 25 to 38 percent profits while the ad­ restoration of confidence. The mentioning of their names ministration spent its energies and money to stimulate re­ With a gentle hint of their past contributions to· the industry covery? Are we responsible for jacking up automobile prices of our country may suggest that they first restore the confi­ on top of these fantastic and suicidal profits? And what -dence people once had in them before telling the Government excuse did they give for increasing the prices? The excuse what to do. As a matter of common sense and decency, why was that the increase in the cost of labor compelled these should we ever restore that sort ·of confidence, under which concerns to increase the selling price of automobiles. The these leaders of finance and directors of government pillaged simple fact was that they had not increased wages since the the small investors and profited on the· ruins of the business preceeding year, and the direct labor cost of an automobile they had wrecked? was at that time only 9-h.percent of the total cost of manu­ Mr. Baruch knows these gentlemen had no fears from 1921 facturing. This same class and kind of deception has run to 1929. Their advice was freely given and loyally followed. through the practice of big business during the past years. They made Government policy and operated with full free­ All we ask is that it be honest with us. · ·dotn. They were the masters of business and government. Are we responsible for all the leading monopoly industries They prospered, and Mr. Baruch with them. Now this taking wider and wider margins of profit as their costs of purring critic comes rubbing up against the trouser legs of production dropped lower and lower? this administration with some of the same advice which Are we responsible because these industries refused to share wrecked and ruined our business in the period from 1921 to their ever-increasing gains with American laborers and 1933; But his advisory smile looks very much as i! he· had American farmers? already swallowed the canary. Are we responsible for General Motors paying its two prin­ Mr. Baruch assures us the fust thing to be done is to re­ cipal executives more than a million dollars a year? A mere store confidence, and he tells us exactly how. He says if the handful of business executives have taken in pay for the·m­ Congress will only reduce the taxes of these exploiters they selves more money than the Government pays the President, will again have confidence and all will be well. Simple, is all the Members of the United States Senate, all the House of it not? Such a very simple remedy for all our troubles. Representatives, and the Supreme Court, all put together, In I repeat, why should we restore that sort of confidence-­ the face of this record some business leaders have the brass that kind of security that would again subject the country to to criticize laws enacted to safeguard the public, and lecture the policies and practices of Richard Whitney; of Sam Insull; 'this Congress for extravagance. ·of Wiggins and Aldrich, of the Chase National Bank; of Are we responsible that large sections of industry refuse to Charley Mitchell, supersalesman of foreign bonds and in­ accept acts of Congress or decisions of the SUpreme Court as come-tax expert; of Charles Schwab, of blowhole armor-plate law? fame; of Tom Girdler, who, like Aesops' fabled ass, masquer­ But we will become responsible unless we face our responsi­ aded in a lion's skin until his bray betrayed his lowly form bilities and meet them like men. We are seeking through a and features; of Morgan; of Sloan;· and their associated lead­ wage and hour bill one of the means to spread increased ers of American industry and-finance? . Do these gentlemen employment and finally to help do away with unemployment. not realize that' the Government's confidence in men de­ It Will be illuminating to inquire how the · unemployment pends upon the good faith and integrity of their business which followed other panics was remedied. Let us see. At practices? · ·the end of the Civil War there was still a billion four hundred Are we responsible for the vastly inflated capital struc­ million acres of public lands to be taken up and put to use. tures--the multiplied watered · stock of our corporations-­ out of that vast area, 12 States were to be carved and ad­ which are demanding prices and profits that literally pillaged mitted into the Union. When a man lost his Job, he bundled a. large part of the national income, while farmers and up his family, went West, took up free land, and "grew up laborers were assisting recovery by ·every means at their with the country." It was through this simple process of command. redistribution of population that the unemployment reSUlting Mr. George F. Johnson, of the Endicott-Johnson Shoe Co., from the panics of 1873, 1893, 1907, and the smaller interven­ ·was asked last summer, "What do you consider the worst ing panics of that period were all automatically bridged over. feature of our present industrial system?" "Watered stock,'' But the panic of 1929 found a totally di1Ierent condition. was his answer. "What do you· think of the present trend of The free land of the West was entirely exhausted. So that legislation?" he was asked. "Well," he said, "there is one law for the first time in our history when a man lost his job he I would like to see Congress pass; that is an act forcing every was out-with no place to go. At that moment America was corporation to declare in its statements exactly the amount of suddenly thrown face to face with the whole problem of money it pays its labor. This would enable everyone to judge unemployment. American statesmanship had been blind to whether workers in each company were getting a square deal the certain arrival of such· a day. When the inexcusable from its executive." panic of 1929 brought on the great depression, in whose back­ Only through a continuous fair division of the profits aris­ wash we are still fioundering, and 14,000,000 Americans were ing from industry can prosperity be made permanent. Actual thrown into enforced idleness, the Nation was totally unpre­ investors must be content With a reasonable return out of the pared for such a cataclysm. This condition of paralyzing profits of industry. The balance must go to labor to provide idleness had come about so suddenly as to stun the political 1938 CONGRESSIONAL RECORD-HOUSE 5315 leadership of that time. It demanded remedies and solutions machinery. He improved production methods. He increased which the old-line politicians showed themselves entirely in­ the profits of his employers tremendously. He threw great capable of providing. numbers of men out of their jobs. He reduced their ability to . This condition is inexcusable and intolerable. The present purchase, and purchasing power is directly dependent on recession is traceable to practices which business has refused labor income. · to rectify. It stems back to the 1929 depression. Even at We ask ourselves, "What is to become of the ever-increasing that time farmers had been reduced to poverty. Forty -eight proportion of men who are dispossessed by labor-saving ma­ percent of them had become tenants on the very farms their chinery?" And no less, "From whence is the income to arise labors had created. The national income had fallen from which will permit them to live? And who will buy the in­ eighty-three billions to thirty-seven billions. Unemployment creased production of the machine?" ·Clearly this impasse, increased from a million and a half in 1928 and 1929 to this stalemate, has to an alarming degree already arisen. 14,000,000 in 1932 and 1933, with many other millions working Big business, following its own will and way, has already only part time. Chaos in business reigned supreme, and stark turned out on the streets more than one-fifth of the indus­ fear gripped the Nation. trially competent men and women of our country. This pro­ This was the condition facing the country when a new portion of unwillingly idle is steadily increasing. Industry has administration came into power on March 4, 1933. An entire offered no remedy for this condition which it has itself new approach to Government had to be made to meet and created. Industry has prescribed no cure for its own self­ remedy these conditions. For the first time in our history we devouring disease. Industry offers no plan for the reemploy­ were compelled to see and recognize in our laws and public ment of the men and women who are unwillingly idle. policy that all industry is national in its scope, and had to be Until these leaders of big business awaken to the full treated as a national entity and be made responsible to the import of these conditions and seek and find some rational public. solution for these difficulties, their scolding and criticism of . The Triple A met the vital necessity for a return of farm the Congress is a display of ignorance, cheek, and gall worthy prosperity. The bank holiday and guaranteed bank deposits only of the days when they were the actual masters of both saved our credit. The administration took action to safe­ Government and business. They are not even wise enough to guard the farmer, the laborer, industry, banking, and to curb see that their wide-flung newspaper and radio campaign to certain abuses. It expended large sums for relief and made discredit government can have only the opposite effect from huge loans to railroads, insurance companies, banks, farmers, what they are seeking. Their hopes of returning . to the and home owners. We primed the pump and started the "happy hunting grounds" of 1921 to 1929 is a futile dream waters of industry to flowing again. But as soon as the founded on the greed of a time gone by never to return. national income began to grow a few of our great monopoly [Here the gavel fell.] industries seized the lion's share. The result is a relapse Mr. CANNON of Missouri. Mr. Chairman, I yield 15 addi- which calls for such action as will prevent a repetition of that tional minutes to the gentleman from Illinois. experience. Mr. HOFFMAN. Mr. Chairman, will the gentleman yield? TheN. R. A. accomplished tremendous results by doing two Mr. KELLER. No; I cannot yield. things: First, it created a national method for raising wages Mr. HOFFMAN. Mr. Chairman, I make the point of of all industries by putting a floor under wages below which order the gentleman is reading, contrary to the rules of the no one was permitted to go. Second, it established a ceiling House. I should like to know from what the gentleman is for hours per workweek, above which no one was permitted reading. to go. That was the basis of every one of the 500 varying Mr. KELLER. My own manuscript, written by my own codes that made up the N. R. A. system. The N. R. A. was, in hand. short, our first national wage and hour law, and what ·it Mr. HOFFMAN. It is exceptionally good, and I wondered. accomplished temporarily in its inexperienced newness we Mr. KELLER. These leaders have quite unconsciously must do permanently by a properly written and fairly en­ made it perfectly clear that government alone is capable of forced wage and hour law. And why any industry should effective action; that government action will involve the resist the establishment of the permanent benefits of the answer not to the question of what are the rights of busi..o N. R. A. is beyond me to understand. A properly written, ness but to the question what are the rights of men? The well-enforced wage and hour law will again establish a rights of business depend entirely upon the rights of men. minimum-wage basis and raise the general wage level. Wherever the rights of men have been asserted and put to It will reduce the hours of labor per week, and by that the test, it has been through the passage and enforcement means furnish many new jobs. of law. It has never been done otherwise. It is equally true Under normal conditions of business the reduction in the that this blind-thing called industry has under the guidance number of hours will automatically increase the number of of its leaders resisted the passage of every law looking toward workers required. · the rights of men. It is also a fact that this blind industry Conversely the increase in number of hours worked, as and its leaders who resisted new laws have invariably profited occurred when the N. R . . A. codes went out, automatically by these h1,1II1anitarian measures. Laws to improve living decreased the number of workers required for the same vol­ conditions have always improved business and increased ume of production. Productivity of labor, due to improved profits. We can, therefore, look with every assurance to machinery and processes, is constantly increasing, and in renewed prosperity for business by enacting those labor laws consequence the amount of labor required to produce the which present conditions imperatively demand. same result is constantly dropping. The National City Bank is a.uthority for the statement The volume of production that required 100 men in 1920 that the up~wing of recovery from 1933 to 1936 was the required only 56 men by 1934. This is one of the principal longest constant period of recovery in our business history. causes of our unemployment problem. We must recognize During this period, what did business do to raise wages to this fact and provide a remedy-a rational, practical, .work­ keep pace with production, prices, and profits? We are com­ able way out of this cause of unemployment. pelled to report that with rare exception it resisted the Development of machinery along many lines is approaching most reasonable demands of laborer and consumer. the point where production is automatic, wherein labor as we Surveys of wage earnings reveal that in many industries­ knew it in former. years plays a small part indeed. North, South, East, and West-many men and women, who During the past period the engineer was called upon by the under the N. R. A. had received $14 per week with a mini­ leaders of big business to reduce operating costs for tbe sole _mum of $12, where being paid less than $10, many as low purpose of skyrocketing profits. No thought or consideration .as $5 per week, soon af~er theN. R. A. codes were inva~dated. was given to the human element. The engineer improved Th~se are no~ exceptional instances. Such earnings prevall 5316 CONGRESSIONAL RECORD-HOUSE APRIL 12 over wide areas, in nearly or quite all of our States. The compensation than the average annual income of 2,500 to- · South has no right to arrogate to itself this doubtful distinc­ bacco farmers.. . ~ . tion. Do you gentlemen think we can build a stable industry There are three .and one-half millions orf men and women on these profits and wages and farm-price policies? I think employed in the Nation's retail business. In September of you will agree with me that these policies are leadiiig straight last year Gen. R. E. Wood, president. of Sears-Roebuck Co .•. to economic suicide. speaking to a large group of retail employers, said: That you do not need as good houses, as good clothing If we are honest, I think we must acknowledge that retail w;ages, ~nd as good furniture in the South as you do in the North particularly in the lower brackets, have been too low. If we are far-sighted, we will correct this condiLm ourselves, rather than be IS nonsense. When you say men can live cheaper in the forced to correct it. South than they can in the North, you ought to add "pro­ vided they are willing to exist on a lower standa,rd of living." No one disputed the truth and justice of that statement. Because even in the Tropics all who can afford them have But the simple fact is that in the years of recovery after j~st as good houses, as good clothing, as good living condi­ the codes were nullified, nothing was done except to abandon tlOns as the people of the same economic status in our own the N. R. A. wage scales and hog the profits the farmers and country. . laborers had created. Industry showed itself incapable of establishing or main­ I lived fot 12 years in Old Mexico out among the people of taining a decent. scale of wages or workweek hours. Gov­ that country. I saw men worked 14 hours a day on the· ernment alone ever has, ever will, or ever can accomplish haciendas for 37~ cents a day for· an average of only 30 this result. There are a large proportion of men controlling days. a year. Their net annual income was about $11.25 in industry who honestly want to do the right thing by labor. Mexican money. You say they received what they were Many hopeful efforts, after the nullification of theN. R. A.,, worth because they were ignorant and lazy and shiftless? were made by these fair-minded, far-seeing businessmen. Then you speak too soon. You speak without knowledge: They all failed ignominiously, because there were enough You speak without experience. You speak without knowing cheaters and chislers to destroy all the efforts of honest men. what is in the hearts of men, in the hearts of all men, every- The law, the law with teeth in it, .is the only answer we can where. · make to the exploiters o{ labor and the robber of the con­ I myself saw those same men have their hours cut to 10· sumers. and their pay doubled and given steady work. I saw those Dr. Claudius T. Murchison, president of the Cotton 'rex­ men, who had never before beard the whistle blow con­ tile Institute, recently testified before the special Senate verted in a few weeks into first-class air-drill crews ~d re­ Committee on Unemployment, of which Senator BYRNES is ceive as ~uch as 10 times~ what they had earned before. chairman. Dr. Murchison . was almost boastful of the fact And what was the result? Were they lazy, Shiftless, and that during the first half of 1937 that industry operated at worthless? Did they turn godless? Far · from it. They full capacity and employed 450,000 men and women whose clothed their women and children and themselves far better. weekly pay roll was $6,700,000. But· is that a condition ·to For the first time in their lives they rode horseback to be proud of? Let us reduce those figures to realities. These church on Sunday morning and paid the priest, as they figures spell an average income of $14.57 per week. If ~ never co':lld before. They held up their heads; they faced workers were employed 40 weeks in .a year propaganda is now under way, under the direction about our ability to meet and solve our present difficulties. of the State Department, to persuade America to accept and We can, we must, and we will. expand the administration's reciprocal-trade policy. The The cry of dictatorship is nonsense, only calculated to principal theme of this propaganda is that if we do not con­ muddy the water. The real dictators are those corporations tinue and extend the reciprocal-trade policy, and if we do who are dictating starvation wages and degrading living not pursue a policy of cooperation ·with other nations, that conditions to men and women who are doing the Nation's we will be compelled to adopt a policy of extreme nationalism, work, who feed and clothe· us, fight our battles, and pay our which will require complete regimentation of American agri­ bills. I will give you a perfect example of such dictation. culture, industry, and all the people. In short, the American I quote from a letter of February 9, 1938, in which Mr. E. T. people are being threatened with dictatorship unless they Lay, executive secretary of the Associated Industries of consent to the Roosevelt-Hull reciprocal-trade program. Florida, reports the activities of himself and Mr. McCork­ Secretary Hull himself has voiced such threats. hill, his vice president, at the Little Business Conference In an international broadcast delivered in Washington, recently held here in Washington. Mr. Lay wrote: March 17, Mr. Hull said: We practically dictated and secured the adoption of the entire Thrown back upon our own resources we would find it necessary re~ort opposing wage and hour legislation and for the investiga­ to reorganize our entire social and economic structure. The proc­ tion and amendment of the Wagner Labor Relations Act. ess of adaptation to a more or less self-contained existence would mean less production and at higher costs; lower living standards; Note the fact that this association is affiliated with the regimentation in every phase of life; economic distress to wage National Association of Manufacturers. This is how big earners and farmers, and to their families; and the dole, on an business works little business. This is how the little busines3 ever-increasing scale. mountain labored and brought forth a mouse. I most emphatically deny that any such necessary choice At the present time if a man says frankly that men are presents itself to the American people. Such complete regi­ more than dollars, at once the dollar defenders shout "red" mentation of the American people is not an inescapable con­ at him and demand that he take an oath of allegiance to sequence of our traditional policy of moderate nationalism. the dollar mark instanter or get off their earth. The liberty-loving American people will not be intimidated by There are a few also who really think a man is a traitor this threat; they will not tolerate such a regimentation as is to the men who labor unless he advocates direct action to portrayed as the only alternative for an unbridled reciprccal­ distribute the wealth now in existence. One is about as sane trade program. as the other and not more so. The fact is that there is no The American people have not lost their intelligence. possible excuse for either extreme in this matter. They have not lost their ability to manage their own affairs. The New Deal has accomplished much. But it has also They have not lost their capacity for self-government. left much undone that might have been done. It has not New Deal propagandists contend that the Smoot-Hawley yet accepted the fact that when industry fails government tariff of 1930 destroyed our foreign markets in that the tariff is duty bound to provide a job for every man and woman who was too high and hence led to retaliation by foreign coun­ wants to work. That is the crux of the whole situation. tries. · The New Deal argues that the way to increase our Relief was and still 1s necessary. It should be freely given foreign trade is by lowering tariffs, and they point to the where needed. But jobs-yes; universal employment-must reciprocal-trade program as directed toward this end. Con­ be provided. Work, not work relief, is the necessity-work sequently, one notes that the principal basis for the New Deal in the making of permanent improvements, with "a man's program is their contention that our loss of markets dates pay for a man's work"-properly financed work to provide with the Smoot-Hawley tariff of 1930. This is not true, as efficiency in making those permanent improvements. There I will prove. 5318 CONGRESSIONAL RECORD-HOUSE APRIL 12 It is important to understand the real reasons behind- the eign countries because the trade barriers were such as to loss of our foreign markets. . The .real causes were in opera­ make it impossible to ship Amerir..an-made goods into some tion as early as the last quarter of the nineteenth century, countries. and these forces were accelerated by the war. The forces AMERICAN BRANCH FACTORIES ABROAD were those of extreme nationalism on tbe part of most Euro­ All through the decade after the war, American factory­ pean nations. These nations wanted to be as economically powers were establishing these foreign branches to serve their independent as possible, regardless of the· cost. Economic foreign markets because of these restrictions on normal self-sufficiency was recognized as a part of military defense trade. In these foreign branches products were being manu­ strategy even before the war, but . the war crystallized this factured from foreign raw materials and by cheap foreign belief. labor. As of December 1932, the number of just the larger STRUGGLE FOR SELI'-SUFFICIENCY foreign branch factories was more than 1,520. I am in­ The peoples of Europe during the World War had been face formed by Department of Commerce officials that the num­ to face With starvation. With their supplies from abroad ber is about the same at tl:\is time. These foreign branch dangerously reduced by the operations of submarines and factories, of course, serve to a great extent the demands of enemy raiders against shipping, the peoples of the European foreign markets which previously had depended upon Ameri­ and other countries saw the necessity for becoming as com­ can factories and American workers. pletely self-sufficient as possible. EFFECT OF FOREIGN LOANS Under this urge for self-sufficiency these other nations Before considering just how this country helped to finance . borrowed money from us to bUY American .machinery. They the development of economic nationalism in foreign coun­ hired American engineers to set up this machinery on their tries, it is well to go back to conditions prior to' the World farms and in their factories and to teach them to emulate War. At the outbreak of the war the ··united States was a American methods of mass production. These nations soon debtor nation. Foreigners held large quantities of our securi­ began to produce for themselves a great mass of the commod­ ties. We annually exported goods and services to pay the ities which formerly theY bought from us. interest and dividends on these investments held by foreigners. POST-WAR TRADE BARRIERS With the outbreak of the World War European agricul­ European nations, after the World War, soon discovered tural and industrial activities were put on a reduced produc­ that tari1fs alone would not protect the agricultural and in­ tive basis. This necessitated their buying larger quantities dustrial machine they were attempting to build from world of both agricultural and industrial products from this coun­ competition. During the immediate years after the World try. Also there was the enormous demand for war materials. War they needed our foodstuffs and other consumer com­ These increases in exports were paid for at first by foreigners modities. As their own production increased they needed selling back to this country their American securities. A less of these commodities. Since we had in this country a number of European countries required individuals holding relatively efficient and low-cost producing plant, we could American securities to turn these securities in to the gov­ readily compete in their home market with their domestic ernment in ·exchange for their own government's bonds. products. To prevent this competition, not only were tariffs It was discovered soon that Europe could not buy ·the ma­ placed on the goods but quotas were established. Under this terials needed with these American investments held abroad quota system, the government set up the quantity of a given The governments of Europe then came to the bankers of this product which was allowed to be imported and allocated this country for credit. Several of the European countries sold quota among the nations which sold this product. Under bonds through American bankers to citizens of the United this system, we could not sell them more than a given quan­ States. tity of a commodity, regardless of what price advantage we With our entrance into the World War, the lending of might have. As the country's production increased these money by American individuals directly to European coun­ quotas were decreased. These quotas are still one of the tries stopped. The Federal Government replaced the Ameri.; principal factors in retarding the renewal o1 world trade. can public and loaned large sums of money to European In addition to quotas, another device &Sed and still in use nations for goods and services which were largely purchased is the control of foreign exchange. In a number of coun­ in this country. tries, after the World War and for most of the period of the With the cessation of war Europe found herself greatly twenties and again since 1929, if any resident of a given crippled and in need of further funds to rehabilitate her country wished to purchase dollars or any other currency, countries. Large sums of money for this purpose. and also he had to get permission of the government and state the to feed her population, were loaned by the United States purpose for which this exchange was to be used. In this Government. When the United States Government discon­ manner the government could very definitely. regulate what tinued loans to foreign governments, large sums of money commodities were to come .into the country, from whom, and were loaned to these nations by the American people all the amounts. There were also a number of sanitation and through the twenties. A considerable portion of this money health regulations set up whose real purpose was to restrict went to purchase American goods and to employ American commodities rather than to protect the public health. personnel to set up a new industrial life in foreign countries. Another factor which has disorganized the world markets Altogether the governmental and private loans amounted to for some years, both prior to the World War and to a much $29,000,000,000. Thus, the lending of this money to build greater extent since the war, has been ·the control schemes agricultural and industrial enterprises was not only taking set up by various nations to govern the production and export our former markets in those borrowing countries but was of given commodities. Great Britain set up a scheme for creating new world competitors for us. the control of rubber; Brazil has long had one for the regu­ By the end of 1928 the American bankers and the invest­ lation of coffee production and ·exports;-Japan has done the ing public commenced to question ability of these countries same thing with camphor and silk. to ever repay their loans. The minute this question was raised All of these devices very definitely retarded the free flow in the minds of the American investing public foreign credit of goods and made it necessary for us to pay much larger ceased in this country. However, by this time world produc­ prices for raw materials than we should have. tion outside of the United States had increased enormously. These conditions grew pr<>gressively worse during the Foreign workers, with their low wages and long hoUrs of twenties. Our business enterprises in-this country realized work, were able to undersell American producers in a great they were .losing the foreign markets permanently. They number of cases even in our home market. saw shipments of machinery and equipment, along. with per­ PURPOSE OF HAWLEY-SMOOT TAB.IF'F sonnel, going abroad to set up factories to produce goods In 1930 the Republican Party enacted the Hawley-Smoot which: formerly they had produced in this country. This tariff, because, outside of the United States, world production forced American concerns to establish their own plants of both agricultural and industrial commodities had increased abroad. Also, they were forced to establish plants in for- to the point where they were successfully competing in our 1938 CONGRESSIONAL RECORD-HOUSE- 5319 home market with their products which had been produced possess or cannot economically produce, while at the same by foreign workers at lower costs of production than we could time reserving to their farms, factories, and service pro­ produce in this country. These lower costs were due to the ducers the home markets in each nation for such products fact that foreign workers' standards of living were much and services as each nation can produce for itself. -This is lower than the American workers'. The Republican policy the professed objective of Secretary of State Cordell Hull further recognized that in a world of ever-changing trade and others in the New Deal who are expanding as rapidly barriers, such as then and now exist, no tariff act could be as possible the reciprocal-trade policy by means of the trade passed by Congress that would be fair to both the American ~reaties. But the difficulty with the New Deal interpretation consumer and producer for long. The Congress recognized of this moderate nationalistic policy-particularly with us that there were probably inequaliti~s in the bill itself; there­ here in America-is that the facts do not perform in ac­ fore, it expanded the :flexible tariff provisions of the Fordney­ cordance with the thebries; we :find ourselves, even this early, McCumber Act of 1922. Under these provisions the Tariff facing grave threats to our American factories, our American Commission was authorized to investigate domestic costs of farms, and our American wage earners. production and foreign costs of production and recommend Moderate nationalism is the happy middle course between to the President a tariff rate which would adequately protect internationalism, which is the doctrine Secretary Hull really both the American producer and the American consumer. believes in and practices, and nationalism, which is the doc­ Thus it will be seen that the Hawley-Smoot Tariff Act was trine of the undemocratic nations of the world. not a cause of the world depression but was the only posi­ EXTREME NATIONALISM tion an American Congress primarily interested in the wel­ fare of their own country could take. This policy is the one pursued by the dictators of the From 1930 on world conditions continued to get progres­ world. The advocates of that policy believe the economy sively worse. No one recognized this fact more clearly than of the world under the impulsions of modern civilization, President ..Hoover and the Republican Members of the Con­ by reason of necessity, is tending irresistibly toward a con­ gress. They saw that these world trade barriers which dition of the greatest possible self-containment in each of the restricted the intelligent flow of goods were causing the major nations. Such a condition of self-containment or depression. These barriers, in turn, caused nations but self-sufficiency means that each nation will, to the greatest newly. on the gold standard to again go off, resulting in a possible extent, equip and prepare itself to produce within complete demoralization of foreign exchange. its own borders all of the commodities and services it re­ quires by-means of its own labor and industry regardless of LONDON ECONOMIC CONFERENCB cost in order to be as safe as possible from the interruptions In the summer of 1932 President Hoover attempted to of war, and to reduce to a minimum the danger of a hostile rectify this condition by persuading the nations of the world blockade of its necessities and luxuries, with resulting , dis­ to agree to an economic conference in London during the comfort and possible starvation. In the case of those nations summer of 1933. It was agreed that at this conferenc~ having colonial territories by which to supplement their own attempts would be made to bring about multilateral trade internal capacities-such as the British Empire-there is agreements which would lower the unintelligent trade bar­ required a great naVY capable of protecting the sea lanes and riers which had been set up by the nations from the World the means of transport from one domain to another of these War on in their endeavors to establish economic self-suffi­ products. ciency regardless of cost. Monetary policy was to be con­ EXTREME INTERNATIONALISM sidered at this conference also, because without stabilization of foreign exchange there can be no successful world trade. In reality Secretary Hull's policies have been policies of As soon as Mr . . Roosevelt was elected, President Hoover extreme internationalU:im. The advocates of that policy be­ made several attempts to get this cooperation for the suc­ lieve that nationalism_results in such a striving for external cessful organization of this conference. Mr. Roosevelt, how­ markets--by those countries which have to produce and ever,_refused to cooperate, taking the position that he had no sell a surplus of commodities which they can produce in responsibility in the matter until he actually assumed office. order to be able to buy from other countries the necessary This conference met in London in June 1933, with most of amounts of such products they cannot produce themselves­ the nations of the world in a mood to consider means for as to surely lead to war. The internationalists would, there­ correcting the existing chaotic currency and trade conditions. fore, break down tariff restrictions and allow the uninter­ However, the conference broke up before it was properly rupted :flow of free trade. They would do this even though organized because President Roosevelt, who had told foreign the effects of such an uninterrupted exchange would require statesmen summoned to Washington before the conference the leveling downward of the wages, working and living con­ that monetary stabilization was all-important, changed his ditions of the more advanced nations, while tending toward mind and refused to consider it. /4...s trade policy and mone­ the leveling upward of the long-hour, low-wage, low-living tary stabilization were inseparable, the conference called by standards of the less advanced nations, particularly those of the President's message ended in despair, and each nation the Orient. was left to engage in every known device of unfair trade The advocates of internationalism argue that the effect of competition. their policy would be to bring the working conditions and I have shown, thus, that world trade conditions in the the living levels of the most backward nations up to higher early thirties were not caused by the Republican ta-riff policy standards, approaching .those of America, for instance. The but were caused by conditions existing even before the World adherents of the policy of modern nationalism reply that· War which were accelerated by the World War itself; that such a result ·has not been the history of those countries the Republican administration had no other alternative but which have practiced free trade; that the historic effect has to pass the Hawley-Smoot Tariff Act, and further, that the been for the low-wage, long-hour, low-living-level popula­ Republican administration endeavored to establish a world tions to retard the advance or to pull the standards of the policy of moderate nationalism; that the reason this policy more enlightened and advanced nations further downward was not established was because of the actions of President than the low standards are lifted upward. Roosevelt, and President Roosevelt alone. Moderate nation­ THE ORIENTAL CONCEPT OF LABOR alism is the only hope of reviving world prosperity. The moderate nationalists cite the further fact that the MODERATE NATIONALISM whole oriental concept of castes, classes, and servitude is Just what is meant by the policy of moderate nationalism? such as to make the more advanced western ideas of labor It is a policy which attempts -to maintain certain tariff entirely unacceptable to the oriental mind. The oriental structures but to allow such free flow of international trade idea, as you know, is that there are certain limited classes as will permit all nations to -procure from other nations­ destined to rule. The masses of the people are considered those services and commodities which they themselves "do-not· little better than so many beasts of burden. The rUling 5320 CONGRESSIONAL RECORD-HOUSE APRIL 12 classes believe it is neither necessary nor desirable to lighten lie hearings on this agreement opened. Negotiations started the workers' labors, raise their wages, or better their living on February 23, 1938; hearings commenced March 14, 1938. conditions, except insofar as may be necessary to keep them Under authority of this act reciprocal-trade agreements from spontaneous revolt. · have been made with the following countries to date: . In those countries where the birth ;rate is high, and the Cuba, Belgium, Haiti, Sweden, Brazil, Canada, Nether­ only limit to human increase is the pressure of population lands, Switzerland, Honduras, Colombia, Guatemala, France, against food supply, the masses of the people tend to become Nicaragua, Finland, El Salvador, Costa Rica, and Czecho­ so dense as to burst the bounds of geographic lines and to slovakia. overflow into other countries to find sustenance. That is However, the concessions we made in each of these treaties the situation in Japan, Italy, Germany, and other countries. were made not only to the contracting parties but to the This is the motivating cause underlying the aggressive con­ world at large. This is done through the most-favored­ :flicts which have for their object the conquest and acquisi­ nation clause. Under the most-favored-nation policy each tion of more territory. trade treaty, with each separate nation, with all tariff con­ WORLD TRADE AND PRODUCTION cessions on all industrial and agricultural items embraced The sabotage of the London Economic Conference by within each treaty, opens our domestic market to all the President Roosevelt caused the acceleration of extreme na­ products of a like nature produced in all of the countries in tionalism. This can be proved by an examination of the the world except Germany. When our whole program of League of Nation's figures of volume of world trade and world reciprocal-trade treaties is concluded, our domestic markets production. will thus be thrown open to all the products of all the coun­ The volume of world raw material trade increased from­ tries of the world on the same basis, regardless of whether the 193.2 figure of 81.5 percent of the 1929 level to 95.5 per­ many of those countries have given us any reciprocal ad­ cent in 1936. However, the production of raw materials dur­ vantages or not. Under such circumstances it is clear that ing the same period increased from 71.4 percent in 1932 to before very long Mr. Hull will have exhausted all of the items 105.5 percent in 1936, based on the 1929 level. of our international commerce and will have nothing more to The volume of world trade in manufactures increased more trade on. rapidly. It rose from 59 percent in 1932 to 75.5 percent in TARIFF REVISION BY EXECUTIVE ORDER 1936, based on the 1929 level. The most-favored-nation clause is the device used tiy the During this period world industrial production increased Roosevelt administration to revise our tariff laws without more markedly. It went from 68.7 percent of the 1929 level congressional action as required by the Constitution. in 1932 to 111.3 percent in 1936. Through the 17 agreements already negotiated 450 duties have The volume of world trade in foodstuffs, including many been reduced, 53 bound at their present levels, and 117 bound basic agricultural products, however, continued to decrease on the free list. Furthermore, none of these duties can be from 89 percent of 1929, in 1932, until 1934, when it was raised or changed upward without this country violating an ... down to 82 percent of the 1929 level. In 1936 it had reached agreement with a foreign nation. If concessions are made on only 85.5 percent of the 1929 level. World production of all of the items which are under consideration in negotiating foodstuffs during this period remained at approximately the the British agreement we will, in reality, have an entirely new 1929 level. tariff law which cannot be changed, except to lower the rates Thus we find that world production in 1936, based on the of duty further, without violating our promises to other 1929 level, was:. Percent nations. Thus it will be seen the Roosevelt-Hull agreements are not only rewriting our tariff laws in an undemocratic and IndustrialRaw materials production------production ______105.111. 35 Foodstuffs production______:_ ___ 100. 2 unconstitutional manner but are fixing a ceiling on our rates of duties for an indefinite period of time. At the same time the volume of world trade hi 1936 was UNITED STATES FOREIGN TRADE POSITION 1929-32 only 85.5 percent of 1929. · · Thus we find that it was not the American tariff but an · . Before considering the effects of the reciprocal-trade agree­ increasing self-sufficiency on the part of other nations which ments on our foreign trade I will show briefly our trade posi­ brought about this disparity between world trade and world tion between 1929 and 1932. In 1929 the United States had production. Also that the policies of the Roosevelt adminis­ the largest foreign trade of any single area in the world. By tration have not changed this world trend toward extreme 1932 our percentage of the total of world exports had dropped · nationalism. from 15.6 percent in 1929 to 12.2 percent. Of the total world VAST EXECUTIVE P?WER GRANTED imports our proportion had declined from 12.2 percent in 1929 Shortly after the London Conference President Roosevelt to 9.5 percent in 1932. commenced to devalue the dollar. This caused further dis­ REASONS FOR DECLINE organization of world trade. Early in 1934 he asked Congress The principal reasons for this decline were, first, the much to enact the Reciprocal Trade Agreement Act. Under the more market decrease in world demand for manufactures act, the President was given the power to negotiate these than other types of commodities. Second, the abandonment treaties with foreign powers to increase or decrease tariff of the gold standard during 1931 and 1932 by most of the duties by 50 percent without regard to definite standards countries of the world, which in tum made our gold prices established by the Congress for such action. He was author­ on exports noncompetitive or too high. Third, the increased ized to fix rates at levels which might be agreed upon for the efforts of certain countries to become completely self-sufficient. duration of the treaties. He was authorized to grant these In this connection I want to introduce at this point as part preferential rates to all nations. He was further empowered of my remarks a table showing the United States percentage to restrict the Congress itself .from increasing present excise share of world trade. taxes, and from placing new excise taxes on such com­ United States percentage 1 share of world trade modities in domestic commerce as are embraced in these [World equals 100 percent] trade agreements. These powers were granted to the Presi­ dent for a term of 3 years, but by the language of the bill , Year Exports Imports Total the life of these treaties cun be indefinite, or for any term ------the President may approve. . 1929_------15.6 12.2 13.8 It cannot be denied that opportunity for the interested Hl32 ____ ------_-- _-- _------__ _ 12.2 0. 5 10.8 1933_------­ 10.9 9.0 9.9 public, the consumers, or those adversely affected by pro­ ' 1934_------11.0 8. 1 9.5 posed agreements, to be heard is entirely inadequate under 1935_------11.5 9. 9 10.6 the terms of the act. Proof of this charge is the fact that 1936_------11.4 10.9 1L2

our State Department commenced formal negotiations on 1 Based on gold value. the contemplated British agreement 3 weeks before the pub- Source: Review of World Trade, 1936, l-eague of Nations p. 23. 1938 CONGRESSIONAL RECORD-HOUSE 5321 This table clearly shows how our iiriports have incre-ased imports were greater in 1936 than in 1932. Both the exports in a more · marl~ed manner under the Roosevelt-Hull trade and imports, however, _have increased in dollar value. policy than exports. The above table and the following ones UNITED STATES FOREIGN TRADE 1927-37 are computed on the basis of gold value, the only interna­ At this point I wish to insert as part of my remarks a tional common denominator for value. ' table showing the dollar value of the United States exports UNITED STATES SHARE OF WORLD TRADE and imports, with the trade balances, covering the period The Roosevelt administration has constantly directed at­ for 1913 China ______112.9106. 9 since 1893. In 1937 exports increased more than imports; 8. Brazil------106.7 however, if the increase in war exports was deducted we 9. Netherlands East Indies------105. 7 would have had an import balance. 10. United Kingdom------..:.------101. 3 WAR GOODS EXPORTS 11. Union of South Africa------99. 7 VVorld change~------~------~ ~------97.3 Since war e~ports have played such an important part in · 12. Belgium------~------96.1 our trade during 1937 I would like to call your attention_to 13. Switzerland------94. 9 my remarks of February 2, when I made the following state­ 14. United States------90.5 ment: Gold value index of change in import trade from 1932 to 1936 A careful examination of the exports for 1937 discloses that war (1932=100) Percent supplies alone amounted to $776,084,094. Even this figure does 1. Union of South Africa------154. 4 not include the whole list of war supplies but only the outstand.:. 3.2. AustraliaBrazil------~------~---~------~---- ______..:; __ 138.138. 03 ing items, such as pig iron, iron and steel scrap, steel ingots, gaso­ ·Iine, airplanes, motortrucks, aluminum, and other nonferrous 5.4. SwedenJapan______·------~------_.:. ______117.115.2 5 metals, including copper, brass, lead, and zinc. In 1932 the total value of exports of these materials was only 6. British Malaya______.:______113. 9 $266,075,000. Therefore 1937 showed an increa.Se of $510,000,000 · 7. United States------107.9 in these war exports, which is nearly twice as much as the entire 8. United KingdOllL------~------101. 8 favorable balance of trade claimed by the Department of·Commerce 9. Canada ______:______:______98. 3 of $261,597,000. Except for this increase in the exports of these 10. Belgium---~------94.2 war supplies this country would have been some $250,000,000 short 11. Argentina---VVorld change------______-______93. 6 of an even ~alance of trade. 12. Germany------90. 4 I introduced into the RECORD at that time a table showing ' 13. Denmark ______:______.:__ 88.1 the exportations of what I asserted were the principal ma­ 14. Czechoslovakia------83. 5 terials readily adaptable to war purposes. I desire at this (Source: Review of VVorld Trade, 1936,· p. 26.) point in my remarks to again insert that short table for the It will also be noted from these tables that in terms of sake of ready reference in connection with my present gold value exports were not as large in 1936 as in 1932 and remarks:

-~- 1932 1933 1934 1935 1936 1937 _, Aircraft parts and accessories, value ______. $7, 946, 000 $9,179,000 $17,663,000 $14, 291, 000 $23, 055, 761 $39,405,473 MotortruCks: Number _____ .······------· 24,968 •3. 516 92,723 99,080 105, 799 165,710 Value ___ • ______• __ • _____ ------______------$11,717,000 $20, 113, 000 $«, 207, ()()() $50, 582, ()()() $54, 764, 366 $100, 105,472 Iron and steel scrap: · Tons __ ..•. ______------._------.---- 2Zl, 522 773,406 1,835,170 2, 130,959 1, 877~ 136 4, 039, 143 Value __ ••... __ ..• __ .------_____ ...... __ ------·-__ ------. __ _ $1,&.9,000 $6,874,000 $19, 188, 000 $22,949,000 $21, 700, 208 $76, 380, 820 Pig iron: Tons_···------·-··· 2,324 2, 750 .,096 .,017 5, 316 782,436 Value_._ .••.. ---___ ------·-·· ... ---.-·.------··- $54,000 $64,000 $97,000 $96,000 $119,362 $19, 403, 285 Steel ingots: Tons------···········------·1, 627 3,159 19,586 . 39,782 21,400 328,764 Value __ __ _•... ___ .. _.• _. _..•• ------.--.--···-· ----: ___ ------·-· -- $64,000 $114,000 $577,000 $901 000 $607,331 $12, !)49, 922 Petroleum and products, value ______208, 381, 000 200,016,000 '0/,537,000 250, '}2,7,000 260, 845, 311 376,274,433 Nonferrous metals, including aluminum, copper, zinc, lead, and brass, except precious, value ______------·- 33,210,000 36,946,000 68,276,000 69,332,000 76,217,448 129, 100, 340 Steel sheets, black, ungalvanized, and not containing. alloys, value ______2,844,000 2,·465, 000 6;025,000 6, 550,000 10,002,781 -22, 464, 346 1------1------1 TotaL .• _. --.. -· ---.------· ------~6,0~5,000 275, 771, 000 383, 570, 000 .U4, 928,000 ~7. 378,568 776, 084, 00. '

I 5322 . CONGRESSIONAL RECORD-HOUSE APRIL 12

At this point I want to put in the RECORD as a part· of my Spain for the years 1932, 1936, and 1937. These ere the three remarks a statement by the Department of Commerce as countries which are now waging war. It is pertinent to published in the Washingt9n (D. C.) Herald of Friday, Feb­ inquire whether our exports to these countries have in­ ruary 25, 1938, entitled "Japan Trade-United States Balance creased; and if so, whether such increase is probably due for 1937 at All-Time High." The statement reads as follows: in large degree to the export of materials of direct or indirect JAPANESE TRADE use in war. While, as I have said, such materials are not An extraordinary expansion of Japan's tr~de with the :United always subject to precise definition, they include primarily States during 1937 gave America an all-time high favorable balance aircraft, motortrucks, steel ingots and sheets, scrap iron and of $181,409,800 over the island empire for the year, the Commerce Department reported last night. steel, petroleum and products, nonferrous metals, certain Japan purchased $362,632,000 of American-made goods while industrial chemicals, machinery, and, the like. Nearly all selltng the United States $184,101,000 of her own products. The these commodities fall into those economic classes known as rest of the trade, totaling a few millions, covered reshipped articles. semimanufactures and finished manufactures, and constitute The report disclosed Japan bought about one-third of all her im­ .ports during 1937 from the United States. Her total imports for a considerable percentage of each. It may be argued, there­ the year were $1,089,176,558, against exports of $917,202,800. Her fore, that a rapid rise in our exports of semimanufactures .unfavorable trade balance for the year was $171,973,758--less than and finished manufactures to countries at war would indicate that with the United States alone. that such rise was due in considerable degree to exports of It is difficult to define just what are war materials and those types of war materials defined above. In the absence what are not war materials. It all depends upon the pur­ of figures covering individual products, we find the follow­ ,poses to which they are devoted, and the time and circum­ ing situation exists with respect to our exports by economic stances under which they are purchased, as to whether or not classes to: any materials are war materials per se; except, of course, 1. Japan: The value of our exports to Japaii in 1937 tn­ actual armaments, such as guns, cartridges, and similar ·creased nearly 115 percent over 1932 and 41 percent over items. 1936. This entire increase, however, was in semimanufac­ Clothing and shoes may become war materials if they are tures and finished manufactures. Exports of crude mate­ purchased for the use of soldiers. Foodstuffs may become rials and crude and manufactured foodstu1fs were actually war materials if they are purchased for the use of armed less in value in 1937 than in 1936. On the other hand. forces in the field. It is equally true that if any country exports of semimanufactures in 1937 were 733 percent greater depletes its domestic stocks of any goods by using such stocks than in 1932 and 138 percent greater than fn '1936, while to arm, equip, and sustain armies in the field and is forced exports of finished manufactures in 1937 were 167 percent to replace such stocks for the use of its civilian population larger than in 1932 and 68 percent greater than in 1936. because of such military depletion, such replacement stocks This extraordinarily rapid rise, taken in conjunction with the constitute, in their nature, actual war materials, and their decline of certain categories of exports to Japan and the fact sale may fairly be said to dei>end upon a condition of war that Japan is following a policy of rigid curtailment of non­ or armament for war, and, therefore, to be an arti:fici~ essential imports, certainly warrants the conclusion that transient, and unstable foreign trade. exports of manufactures and semimanufactures are in con­ EXPORTS TO JAPAN, CHINA, AND SPAIN siderable degree responsible for our increased trade with In this connection I wish to analyze briefiy our exports to Japan. It may be added that whereas our exports to Japan Japan, China, and 'spain. For that purpose I want to insert of semi and finished manufactures were, in 1932, only 28 as a part of my remarks at this point a table entitled "Ex­ percent of our total exports, these had increased to 45 percent ports to Japan, China, and Spain, by Economic Classes, for in 1936 and 68 percent in 1937. In short, over two-thirds 1932, 1936, and 1937 ." The table follows: of our entire exports to Japan in 1937 consisted of semi and Exports to Japan, China, and Spain by economic classes, 1932, 1936, finished manufacturers as against less than one-third in · and 1937 1932. - [Thousands of dollars] 2. China: With .respect to China, the infennce that our lAPAN exports consist largely of war materials is even clearer. ..~ Total exports to Qhina showed a decline of 11 percent in Percent Percent Percent 1932 1936 change, 1937 change, change, value .in 1937 from 1932. Yet, in the face of this, exports 1932-36 1936-37 1932-37 of semimanufactures rose 202 percent in 1937 ·over 1932 and ------41 percent over 1936, while exports of finished manufactures Crude materials ______~ 110,999 91,M9 -17.3 68 1932, Crude foodstuffs ______••17 +11. 8 -2.7 advanced percent over though declining slightly from 252 355 -H<).9 ~9 -29.9 -1.2 1936. this Manufactured foodstuffs ___ 1, 790 1,036 -42.1 1,336 +20.0 -25.• In same period exports of crude materials and Semimanufactures______16,668 58,459 +250. 7 138,858 +137.5 +733.1 crude and manufactured foodstuffs declined 76. percent, 87 .Finished manufactures ____ 20,M3 32,758 +58. 7 55,W. +68.2 +166. 9 percent, and 77 percent, respectively. Incidentally exports TotaL ______------133,770 n3,606 +52.2 287,386 +'1.1 +1U.8 of semi and finished manufactures to China rose from 37 percent of our total exports to China in 1932 to 80 percent CHINA in 1936 and 83 percent in 1937. 3. 78 Crude materials_------29,599 7,911 -73.3 7,2.'i9 -8.2 -75.5 Spain: In the case of Spain, our exports declined .Crude foodstuffs ______- 1, 843 . 261 -85..8 237 -!!.0 -87.1 percent between 1932 and 1937 and 72 percent _between 1936 Manufactured foodstuffs ___ 3, 777 939 -75.1 883 -6.0 -76.6 ·Semimanufactures ______5,053 10,885 +115.4 15,260 +40.2 +202.0 and 1937. The reason is undoubtedly due to the revolution, Finished manufactures ____ 15,450 26,700 +72.8 25,903 -3.0 +67.7 and the fact that otir exports to Spain of semi and finished TotaL ______------55,722 46,696 -16.2 49,542 +6.1 ---11.1 manufactures have shown as large a decline between 1932 and 1937 is due to the fact that we have prohibited the ship­ SPAIN ment of war materials to Spain. However, Spain has drawn ori us heavily for foodstuffs. Other nations are incre&Si.n~ Crude materials______U,172 7, 008 l -50. 6 194 -97. 2 -98.8 their armaments. In the next section will be shown their Crude foodstuffs______223 16 -93. 3 ~ +197. 3 +HJO. O Manufactured foodstuffs___ 242 103 -57. 3 19 -81. 6 -92.1 iinportance in our· export increases. Semi-manufactures______3,066 3,730 +21.7 1,885 -49.5 -38.5 Finished manufactures____ 8, 861 10, 650 +20. 2 3, 415 -67. 9 -61. 5 ~ONAGRICULTURAL EXPORTS 1------TotaL ______• 26,664 21,505 -19. 0 6, 969 .-72. 3 -77.6 In this study of exports and imports it is, of course, impos­ sible to include all the items involved because such tables Source: Monthly Summary of Foreign Commerce, Bureau of Foreign and Domes­ would be too long and intricate for the purposes of anyone .tlc Commerce, December 1937. except the experts. I want to insert in the RECORD at this The table I have just referred to gives the value of United point, however, as a part of my remarks, a table showing states exports by economic classes to Japan, China, and the value of exports and imports of crude materials, semi- 1938 CONGRESSIONAL RECORD-HOUSE 5323 manufactures, and finished manufactures for the years 1932 Value of exports and imports of crucle materials, semfmanufactures, and 1937, together with the perce:Qtage of change in each. and finished manufactures, 1932-37--Continued For the purposes of this table there have been selected the Percent most important categories of these commodities. I am in­ Commodity 1932 1937 change, serting this table for its informative value and because it 1932-37 shows the trend of our foreign trade in commodities other than agricultural. It will be noted that many of these items Semimanufactures, total-Continued. Most important types-Continued. which show the greatest amount of increase in exports are Zinc sem.imanufactures: the ones which fall within the class of war materials. The Exports .. ----·------900 1, 557 +73.0 Imports_------20 3, 983 +19,815.0 table follows: Coal-tar products: Value of exports and imports of crude materials, semtmanujactures, Exports ___ ------8, 752 14,878 +70.0 Imports __ ------9,158 18,353 +100.4 and finished manufactures, 1932-37 Industrial chemicals: [Values in thousands of dollars] Exports ___ ------14,958 27,505 +83.9 Imports ______------13,619 20,447 +94.2 Fertilizers: Percent Exports. __ ------­ 8, 653 16,954 +95.9 Commodity 1932 1937 change, Imports._------18,689 46,704 +H9.9 1932-37 Other: Exports ___ ------48,229 61,289 +27.1 In•ports __ ------4 7G, 787 i 272,124 +254.4 Finished manufactures, total: Crude matertals (nonagricultural), total: 93,777 198,475 Exports. ___ ------1604, 009 8 1, 584,836 4-162.4 Exports._------··------­ +111. 6 Imports____ ------340, 501 551,323 +61.9 Imports._-.---_------101, 658 243,619 +139.6 Most important types: Most important types: Leather manufactures: Coal and coke: 3,181 44,543 67,351 Exports. _____ ------7,965 +150.4 Exports.------+51.2 Imports.. ------9,809 11,734 +19.6 Imports._------­ 5,137 4, 795 -6.7 Fur manufactures: Petroleum: 27,106 96,431 Exports.------­ 1, 357 4,271 +214. 7 Exports ___ ------____ ------·-- +255.8 Imports . . ------1, 078 6,345 +488.6 Imports __ ----______------30,424 22,104 -27.3 Rubber manufactures: Furs: 15,271 29,114 11, 176 13,604 Exports.------­ +90.6 Exports_------.---___ ------+21.7 Imports. __ ------888 1,540 +73.4 Imports ____ ------____ ------25,137 78,542 +212.5 Tobacco manufactures: Iron ore: (),908 220 Exports.------·------­ 13,252 +91.8 ImportsExports. ______------.------4,039 +1, 735.9 Imports. __ ·------3, 535 3,483 -1.5 1,539 5,842 +279.6 Cotton manufactures: Copper ore: Exports _____ ------36,248 43,646 1,473 892 -39.4 +20.4 Exports ___ ------Imports ______------26,969 51,667 +91.6 Imports ____ ------__ ---___ ----__. _- 3, 361 49,435 +1, 370.8 Jute manufactures: Other: ~ 1, 389 1, 428 9, 259 16, 158 Exports _____ ------+2.8 ImportsExports._------______• ______+74.5 Imports __ ------20,602 47,998 +133.0 36,060 72,901 +102.2 Flax, hemp, and ramie manufactures: Semlmanufactures, total: Exports. ____ ------102 457 +348.0 2 709,016 Exports·------t 216,946 +226.8 Imports ____ ------___ _ 19,873 32,498 +63.5 Imports______216,967 634,181 +192.3 Wool manufactures: Mos~re~~ant types: Exports. ____ ------833 1,996 +139. 6 Imports. ___ ------11,539 24,468 +112.0 Exports.------· 13,150 17,335 +31.8 Silk manufactures: Imports._------6,847 12,186 +78.0 Exports ___ ------__ 4, 547 7,117 +56.5 Furs, dressed: Imports. ___ ------5,933 ll,Q88 +86.9 Exports __ ------943 1, 414 +49.9 Rayon manufactures: 2,278 2,155 -5.4 Exports ______------2,493 10,447 +319.1 Imoort.c; ______------_ 2,621 9,321 +255.6 Aw;~~!~ ~ ~~~~~~~~~~~~~~~~~~~~~~~~ 2,198 951 -56.7 Miscellaneous textile products: . Imports._------2, 376 7,815 +228.9 6,410 12,723 +98.5 Rubber (reclaimed and scrap): 8,442 13,358 +58.2 Exports.------·------1, 093 2, 970 +171. 7 Woodr~~~~:= manufactures: ======~ · ~ 217 442 +103. 7 Nav~ft~~~-=------t_: Imports.Exports._------______: ______9, 784 20,240 +106.9 2, 915 7,258 +149. 0 Exports ___ ------___ ._. __ 11,587 22, 141 +91.1 Paper manufactllres: Imports __ ------103 168 +63.1 Exports __ ------­ 15,328 31,088 +102.8 Vegetable oils: · Imports._------~ ~4, 135 137,070 +45.6 Exports ___ ------4, 241 4,337 +2.3 Petroleum manufactures: 7 Imports __ ------21,577 86,664 +301.6 Exports __ ------153,882 197,199 +28.1 Dyeing and tanning materials: Imports ___ ------28,276 22,104 -21.8 1,483 1, 754 ImportsExports ______------:: - +18.3 Glass manufactures: 3,267- 7,803 +138.8 Exports ____ ------_ 4,067 9, 784 +140. 6 Cotton semimanufactnres: Imports __ ------_ 3, 667 10,172 +177. 4 Exports______----·---·---- 9, 276 16,017 +72.7 Clay products: Imports __ ------933 5,243 +462.0 Exports._------­ 2, 201 "7, 909 +259.~ Wool semimanufactures: Imports._------4, 375 9,923 +126.8 Exports._------­ 393 490 +24.7 Asbestos manufactures: Imports __ ------1,160 7, 389 +536.0 Exports __ ------1, 458 2,608 +78.9 Wood semimanufacturcs: Imports. ____ ------286 86 -70.0 Exports._------26,281 53,703 +104. 3 Carbon and graphite products: Imports ______------10,913 26,173 +139.8 Exports __ ------__ ------__ 1, 582 4, 461 +182.9 Petroleum semimanufactures: a Imports __ ------_--__ ---- 383 976 +154.8 Exports. __ ------26,797 76,711 +186.3 Iron and steel advanced manufactures: Imports ___ ------965 1, 325 +37.3 Exports._------­ 34,118 120,009 +251.7 Hydraulic cement: Imports._------7, 776 20,234 +160.2 Exports __ ------_ 802 1,045 +30.3 Electrical machinery: _ _ Imports •• ------368 1, 341 +264.4 Exports. __ ------­ 43,039 112,609 +161.6 Abrasives: Imports_-__------1, 949 2,349 +20.5 Exports._------··---­ 2,834 8,272 +191.9 Industrial machinery: • Imports._------1, 339 6,281 +369.1 Exports. ______.:--.-.-.------78,076 291,132 +272.9 Sulphur: 4,890 13,308 +172.1 Exports._------7,445 12,089 +62.4 Agr~uJfu~-macllillery;------Precious stones: - Exports. __ ------10,548 73,366 +595. 5 Exports. __ ------___ _ 83 586 +606.0 Imports ______------989 7, 035 +611.3 Imports __ ------12,918 42,583 +229.6 Automobiles and other vehicles: Iron and steel semimanufactures: · Exports ____ : ______------90,082 409,896 +355.0 Exports ___ ------14,517 231,967 +1, 497.9 Imports. ______------641 2,307 +259.9 Imports.------4,029 7,895 +oo.o· Medicinal and pharmaceutical prepara­ Ferro-alloys: tions: Exports._------717 12,393 +1,628.5 Exports .• _---~------­ 10,026 17,979 +79.3 Imports.- ______-,------__ 4,540 27,137 +497. 7 Imports._._---- __ ------__ ------2,530 4,894 +93.4 Copper sem1manufactures: Pigments, paints, and varnishes: Exports __ ------____ ------15,717 86,356 +449.4 Exports ____ ------·-- 10,366 21,544 +107.8 Imports.------20,292 3,591 - -82.3 Imports._------1,445 2,179 +50.8 Brass and bronze semimanufactures: SoapExports and toilet ______preparations: .:.: ______- ______Exports __ ------____ ------1,497 45,773 Imports ______6,422 9,199 +43.2 Imports ______------64 49 +2,~~:: 2,038 3,131 +53.6 Nickel semimanufactures: Explosives: Exports_------635 2,685 +322.8 Exports------1, 281 3,863 +201.6 Imports_------4, 508 ~330 +351.0 Imports______371 863 +132.6 {Footnotes at end of table) (Footnotes at end of table 1 5324 CONGRESSIONAL RECORD-HOUSE APRIL 12 Value of exports and imports of crude materials, semimanufactures, On the surface these tables seem to show that the recip­ and finished manufactures, 1932-37--Continued rocal-trade agreements may have been advantageous to Percent American industry. However, on closer analysis we will find Commodity 1932 1937 change, that these increases are to a large extent temporary in na­ 1932--37 ture. First of all nonagricultural crude materials imports increased by 139.6 percent while exports increased by 111.6 percent. Semimanufactures exports increased more than 13,538 22,511 +66.3 imports. It will be noted, however, that in semimanu­ 2,409 7,923 +228. 9 factures the greatest increase of exports, both in percentage 5, 493 12,255 +123.1 and in dollars, have been in such items as petroleum, iron 1,265 3,004 +137. 5 and steel, and nonferrous metals, all of which items are war 1, 393 2. 591 +86.0 materials. Again, in finished manufactures, we find ex­ 1,656 4,589 +180.5 ports have increased more than imports. However, on exam­ 1, 741 4,722 +171.2 ination of the table, we find that imports of a number 3.,365 4,180 +24.2 of very important items such as cotton manufactures . 1,668 3,676 +240.3 and other textile items have been materially larger than 68 299 +339. 7 exports. 12,440 22,833 +83.5 Most of the increase in exports has been in such items as 5,686 9,598 +68.8 advanced iron and steel manufactures. This category in­ 799 3,134 +292.2 cludes war materials, industrial machinery, and agricultural 1,561 10,806 +592. 2 machinery, which are largely capital goods and mean im­ 3.,528 6,988 +98. 1 proved industrial methods abroad and a permanent loss of 560 885 +58.0 former American farm markets. Thus it is apparent that 12,038 38,087 +216. 4 there has been no real permanent benefit to industrial Amer­ 55,442 62,222 -5.8 ica from the trade agreements. I will next examine briefiy trade figures on agricul­ 914,360 2. 489,590 +172.3 tural products. Here again it will be shown that the trade 658,592 1, 428,695 +116. 9 treaties have been anything but helpful to the American t Includes $20,219,000 in finished manufactures under industrial chemicals; pig· farmer. ments, paint, and varnishes; and fertilizers. . AMERICAN AGRICULTURE NOT HELPED 2 Includes $31,762,000 in finished manufactures under industrial chemicals; pig· ments, paints, and varnishes; and fertilizers. One of the main purposes avowed by the Administration a Includes natural gasoline, gas and distilling fuel oil, residual fuel oJ, paraffin wax, petroleum asphalt, etc. . for its reciprocal-trade policy is to broaden the world mar­ • The size of ·this total is due almost entirely to imports of paper base stock and tm kets for American agriculture and to aid the American which, together comprised about $71,000,000 in 1932 and $212,000,000 in 1937. These are not listed separately as they are noncompetitive and we have no exports of these. farmer. In my remarks of February 2 I showed that in 10 • Does not include $20,219,000 of total of finished .manufactures. (See note 1 above.) important categories of agricultural products the balance of • Does not include $31,762,000 of total of finished manufactures. (See note 1 above.) 7 Includes gasoline, kerosene, lubricating oil, and lubricating grease. trade was very greatly against the United States. 1 Includes office appliances and printing machinery. In the course of my remarks on Febrnary 2 I placed in the The above table shows that the total·exports of nonagri­ REcoRD a table showing the quantity and value of exports . cultural crude materials, semimanufactures and finished and imports in these 10 important categories of agricultural manufactures have increased from .$914,000,000 in 1932 to commodities. That table showed the value of these agri­ $2,490,000,000 in 1937, or have increased by 172.3 percent. cultural imports and exports. I wish to include the table During the .same period total imports of these groups have in­ at this point for the purpose of ready reference in connec­ creased from $659,000,000 to $1,429,000,000, or by 116.9 percent. tion with the present discussio~

VALUE OF ExPoRTS AND IMPORTS Table showing an increase in value in imports of agricultural com.mod.itie3

1932 1933 1934 1935 1933 1937 \ I Cattle: Imports______$1, 499, 000 $572,000 $616,000 $8,497,117 $10, 708, 230 $16, 312, 003 Exports ______------·- 216, 000 192,000 364,000 271,324 340,432 473,366 Live hogs: Imports______2, 000 1,000 500 312,888 1,453,841 1. 529, 1.22 Exports_·------___ -·------·------· 112, 000 143,000 45,000 11,654 7,968 9, 806 Pork products: . · Imports- ~ ------··------1, 088, 000 668,000 611,000 2,160, 252 9, 565,414 17, 829,339 Exports------: ------·---- 9, 879, 000 12,738,000 16,747,000 U,044, 785 11,709,996 10,751.100 Lard.6nports------None None None None None NODe Exports------31,885, 000 34,098,000 26,096,000 11,870,221 13,494,036 :15. Sl86, 585 Canned meats: Imports------·------·1 1, 953, 000 2, 711,000 3, 04.9,000 6,626, 393 8, 430,524 9, 172, 1ZJ Exports_·------·------·------1 • 2, 358, 000 2, 982,000 5,298,000 4,305, 441 3, 994, 146 4. 078, 574 Butter: Imports------·------213, 000 150,000 210,000 3, 576,942 2. 015,660 2, 509, 021 Exports------·------·------391, 000 280,000 314,000 246,920 266,858 292, 628 Cheese: · Imports ______·------'------12, -t94, 000 10,844,000 10,659,000 11,~,943 12,716,793 12,809, 474 cor:xports ______• ___ : _.;_____ • ______._ ~~ I ~-- 258,000 236,000 269,000 254,008 267,489 279, U9 Imports______160,000 77,000 1,530,000 lin, 291,889 16,081,671 li6.184. 2f6 Exports.------2, 815,000 2,653,000 2, 269,000 265,157 551,573 a, 88i, 711 Wheat: Imports.------II, 362,000 5, 767,000 14,490,000 30,362, 43( 44,069, 'l!J7 19,404,724 Exports·------32,684,000 4, 769,000 10,249,000 212,231 1,851,385 86,00, 432 Hay:imports ______: ______96,000 1.6911,128 ' 63,000 219,000 664,567 544,198 Exports ______:. ______:. ______t-___63_,_ooo_t-----·l------l------l------t---388,--008- 33,000 46,000 56,151 38,647 TotaL-_------______:..------.: __. ______Imports------22,867,000 2n,843,000 31,284,000 82,693,425 105, 590, 970 136, 939, 180 Exports ______.; ______. ------.----_: ----:------80,651.000 59, '124, 000 61,697,000 31,538,892 32,522,928 72,185,449 1 1938 CONGRESSIONAL RECORD-HOUSE 5325

From this table it is apparent that the reciprocal-trade CONTRADICTION OJ!' POLICIES agreements have not been helpful to agriculture. In fact, I have conclusively shown that the reciprocal-trade agree­ agriculture is on an import basis. ments have not helped American economic life. I have fur­ COMPETITIVE AGRICULTURAL IMPORTS INCREASE ther shown that we have not made as rapid a recovery from I wish to include at this point, as a part of my remarks, a the depression as other nations. It is logical to ask the table entitled "Foreign Trade in Agricultural Products, question, "Why is this true that the United States with the 1929-37," showing for those years the agricultural do­ most efficient machinery and equipment, with the most com­ mestic exports, the competitive imports, and the percent of petent workers, the Nation to which for some years the whole competitive imports to domestic exports. In this table it world has looked for industrial progress, should lag?" Mr. will be noted the figures show that the percentage of com­ Speaker, the answer is obvious. It is due to the contradictory petitive imports to domestic exports has risen from 56 per­ and vacillating policies of the Roosevelt administration. We cent in 1929 to 118 percent in .1937. The table follows: find a domestic policy of restriction of agricultural and in­ Foreign trade in agricultural products, 1929-37 dustrial production, a domestic policy of raising prices, "if not one way then another." At the same time we see Secre­ Percent of tary Hull, without apparently paying any attention to the competi­ Domestic Competitive tiveim­ domestic policy of the Roosevelt administration, lowering tar­ Year ended June 30 exports imports ports to iffs in an undemocratic and unconstitutional manner. Is it domestic exports any wonder that we have been flooded with foreign goods? Mr. Roosevelt claims to have a heartfelt interest in the worker and to have done everything in his power to raise 1929------$1, 847, 000, ()()() $1, 031, 000, ()()() 56 1930------1, 496, OOQ, 000 889, 000, 000 59 wages. However, at the same time, Secretary Hull has been 1931_ ------1, 038, 000, 000 512,000,000 49 lowering the tariffs and letting products come in which are 1932.------752, 000, 000 375,000,000 50 1933.------590, 000, 000 283, 000, 000 48 produced by foreigners who work long hours at low wages. 1934._------787, 000, 000 419, 000, 000 53 1935------669, 000, 000 498, 000, 000 74 ftll!: CHISEl ER8 1936_------766, 000, 000 641, 000, 000 84 1937 (preliminary)------733,000,1m 868, 000, 000 118 The constant cry of the Roosevelt a.dmfnistration has been that the "chiseling 10 percent" of American industrial em­ Source: Foreign Crops and Markets, Nov. 20, 1937, p. 339. ployers who pay their employees low wages and work them By competitive agricultural imports is meant those com­ long hours can and do prevent the rest of the employers from modities which could have been produced in this country at increasing wages and shortening hours. In other words. the a reasonable price to the consumer. The noncompetitive are administration's claim is that this 10 percent of employers commodities not produced in the United States, such as who pay low wages and work long hours drag the 90 percent rubber, coffee, silk, tea, bananas, and so forth. of employers who want to pay high wages and work shorter Thus it will be noted that in the fiscal year 1937-for the hours down to the lQwer level. The administration has never first time in our history-competitive agricultural imports contended that the 90 percent of the employers who want to alone were 18 percent greater than the exports of agricul­ pay high wages and work short hours could, unaided by laws, tural commodities produced in this country. lift the 10 percent to the upper levels. It was exactly upon It is obvious, then, that the trade agreements have not that premise that theN. R. A. was established. It was exactly helped American agriculture or industry. Furthermore, they upon that premise that the National Labor Relations Act was have helped to prolong our unemployment and to promote passed. It is exactly upon that premise that wage-hour economic nationalism in other countries as I will now show. legislation is urged. WHERE IS LOGIC? RECOVERY IN VARIOUS COUNTRIES Mr. Chairman, what better evidence of the fact that the How, then, can the Roosevelt administration find any logic New Deal policies, both domestic and foreign, have retarded to sustain its contention that the competition in American prosperity in this country is there than the fact that since markets of the products of foreign low-wage, long-hour labor 1932 14 countries of the world have made great progress back will not drag down or retard improvement in the wages and toward a more prosperous condition. I wish to include a working conditions of American wage earners, if that very table showing a list of 20 countries and their progress back effect is produced, as the administration says it is, by low­ toward prosperity from 1929 to July 1937. The table shows wage, long-hour workers in the United States? that the United States was sixteenth down the list in point of Let us look at this question from another angle. recovery among these leading nations of the world as meas­ NEW COMPETITION CREATED ured by industrial production. The table follows: It has long been recognized that the influx of foreign labor RANK OF LEADING COUNTRIES IN RECOVERY into the United States, labor accustomed in its own country to The United States ranks sixteenth in recovery among the low wages and long hours, and therefore willing to work in leading nations of the world as measured by industrial pro­ this country at low wages and long hours, resulted in retard­ duction: ing improvements in the wages and working and living stand­ Percentage increase ( +) or decrease (-), 1929 to July 1931 ards of all American labor. It was for exactly that reason 1. Japan------+'73. 1 that our various immigration laws and exclusion acts were 2. ~tonla------+53.8 passed. 3. Latvia------_- +51. 0 What is the difference in the effects, Mr. Speaker, between 4. F'inland ------+48. 3 5. Sweden------+43. 0 the importation of cheap foreign labor to compete with Amer­ 6. Hungary ------1+40. 1 ican labor and the importation of the products of cheap 7. Denmark------·------+34. 0 foreign labor under these reciprocal-trade treaties to compete 8. Chile------+27. 4 9. United Kingdom------1+26. 1 with the products of American labor? There is none. 10. Germany------+ 17. 3 At least, when foreign labor was imported to this country, 11. NorwaY------+ 13.8 that labor became consumers of a sort in this country. When 12. Austrta------+11.0 we import the products of cheap foreign labor that foreign 13. Canada------+2. 7 14. Netherlands------+2. 5 labor does not constitute any consuming power in this 15. Czechoslovakia------2. 9 country. 16. United States------4. 2 If for any reason one American worker displaces another 17. BelgiuDG------12.6 American worker who is rendered idle, the first worker has 18. Italy------14. 1 19. Poland ------15. 4 to help support his idle brother. But when we import the 20. F'rance ______: ______-28. 3 products of cheap foreign labor, and to that extent render 1 Covers second quarter of 1937. idle American workers, the foreign workers do not help to (League of Nations Monthly Bulletin of Statistics, December 1937.) support the idle American workers. LXXXIII--336 5326 CONGRESSIONAL RECORD-HOUSE APRIL 12

'I'P..(: PROPOSED BRITISH-AMERICAN TREATY impediments on specified commodities of special interest to the two contracting countries. The effect of these reductions is _then I cannqt understand, and neither can anyone else under­ extended automatically to other countries by virtue of the most­ stand, why President Roosevelt pursues a domestic policy of favored-nation clause in other commercial agreements, though extreme nationalism and a foreign policy of extreme inter­ the choice of the commodities selected in each case for tariff reduc­ tion makes each bilateral treaty of more importance to the two nationalism. An examination of the facts relative to the contracting countries than to others.· pending British agreement will prove this point. These treaties have thus done something to promote inter­ We are now engaged in negotiating a trade treaty with national trade, though the results have not attained great dimen­ sions, since it is obvious that the willingness of two contracting Great Britain which embraces within its list of commodities countries in a bilateral treaty to agree to particular tariff reduc­ to be considered for possible tariff reductions some 25 percent tions is restricted by the knowledge that the reductions must, of our total list of dutiable items, in addition to the free list. under the most-favored-nation clause, be extended to other is timely to give some consideration to Great Britain, her countries who are making no corresponding concessions under the It same treaty. • • • dominions,_and colonies. Mr. Cordell Hull has now arrived at a stage at which he con­ TRADE AGREEMENTS HAVE POLITICAL BASIS siders he can make little further progress unless a treaty is con­ cluded with Great Britain, and for that as for other reasons at­ It is untrue to say that these reciprocal-trade agreements, taches great importance to it. • • • particularly the pending British agreement, are based upon a Great Britain has also concluded a number of bilateral agree­ purely economic consideration for American industry. Bene­ ments, of which the results are extended by the most-favored­ to American agriculture and to the American manufac­ nation clause. In these cases, however, the extension is subject fits to the important limitations that the most-favored-nation clause turing industry, and consequently to American labor, are is subject to the overriding provisions of imperial preference, and neither the sole nor the paramount considerations in nego­ does not apply to quotas, of which Great Britain has a number tiating these trade treaties. The economic factor has become affecting agricultural products. • • • The Foreign Office, which would naturally welcome an agreement ·involved with that theory of internationalism which insists for its political advantages, has some diftlculty in making its point that the United States of America inevitably must share in of view effective, because the negotiations are, in their nature, all of the misfortunes of the world, and that the United highly technical and complex. • • • States of America owes it to the rest of the world a duty The issue (of a successful agreement) will, therefore, probably as depend upon whether the political advantages are adequately to assist in changing and in elevating the conditions of the realized, and are given their full weight by means of constant -other peoples of the world, regardless of their attitude in the pressure on the Prime Minister and Foreign Secretary, assisted by matter and regardless of the adverse effects upon American clear indications of the interest of the general public. The political importance can hardly be overstated. All those in industry and American labor. America who are concerned to see an improvement of relations· with These trade treaties, and particularly the proposed British this country (England) attach the utmost importance to a suc­ tre~ty, are far more political in their actual implications cessful conclusion of the negotiations. · They regard it as a crucial than. they are economic. They .are designed to serve politic~! 'test of the possibility of a real dev~lo,Pment of cooperation between the two countries, and believe that while succ.ess will give a strong pttrposes and ~ to achieve political ends. I use the term "po­ impetus to this ~evelopment, ·failure will no less certainly involve ·Iiticar' in. the international sense. I have the best authority a serious setback. . These who are most closely in touch with for this statement. · American opinion are aware that the importance attp.ched to the negotiations in the United States of America-iS lmniensely greater SEcRETARY .HULL'S INTERNATIONALISTIC SENTIMENTS than is generally realized here, and are bound to accept the In an address before the National Farm Institute at Des evidence that America's attitude toward this country, and, indeed, Moines, Iowa, last February 19, Mr. Secretary Hull had this her policy generally in regard to external relations, will be sub­ stantially affected by this particular issue. to say: That being so, the importance of the question is obviously very There is today no greater force·in the world for the advancement great at· this juncture. President· Roosevelt is trying, as his great of stable prosperity and peace than the . reciprocal-trade pro.­ Chicago speech -of October 5 shows, to arrest and reverse the gram • • •. strong movement toward complete isolationism reflected in the In that connection,. the pending negotiations with the United neutrality legislation. It is also obvious that he is encountering Kingdom may play a vital role. The very magnitude of the inter­ great resistance. It is evident that an American movement toward . national trade relations of our tw.o countries is sufficient to suggest (political) cooperation can only proceed through economic aa · the possible influence ~hich a satisfactory trade agreement between ·distinct from political action. them might have upon commercial policies throughout the world • • •. In other words, the political implications and objectives of No . nation, -however large in territory and however richly en- these trade treaties must be concealed from the American . dowed witll natural resources, can attain a generally satisfactory people, as Sir -Arthur Salter sees, under the guise of treaties standard of living and can maintain otherwise a high level of designed to bring economic advantages to American indus­ national welfare if it shuts itself off from the rest of the world and attempts to live a self-imposed hermit life. tries. I quote this· British authority further: The trade-agreements.policy 1s anJndispensable part of our broad Economic cooperation, however, inevitably has a political effect; a~d . co~pre~epsive program designed not only to pro~ote in our it may or may not lead later to political action, e. g., a modifi.,. · country stable and sustained economic prosperity, but alsO· to cation of the neutrality law or direct advice in a. particular political assure-for-our -Nation· a condition of durable peace • • •. dispute, or even in a particular-case, economic action directed to . We- cannot remain prosperous in a poverty-stricken world . . For , ·a polltica_l purpose. · · us, as for any. ~ation, economic isolation would inevitably mean · increasing impoverishment with ever-growing regimentation, more Here we have the British View which.is, as expressed in Mr. · and more unemployment, the dole on an ever-expanding scale, and Roosevelt's Chicago speech of last October 5, the quarantin­ general decadence. Nor can we be certain to remain at peace in a world growing more -and more diSordered, with arbitrary force ing of aggressor nations by means of economic sanctions supplanting the rule of order under reason and law. 'which necessarily lead sooner or later to armed enforcement. There will not be m111tary disarmament without economic ap­ 'sir ~thur Salter says further: . peasement. ·we lPld al.l nations must ~ark for· both. ·Never was . the .need· greater. than now for. the casting of every appropriate . But even apart from such possib111ties, the mere fact of economic weight .at our. command on that side of the scales which tmns the cooperation has an immense political advantage at the present juncture. balance tow~rd peace. Here we. have a clear declaration in .favor of an extrem.e CS.:n anyone read these expressions by Sir Arthur Salter internationalism as· our policy. and be ·blind fo the plain implications of what he says? sm ARTHUR SALTER'S VIEW REDUCTION OF WAR DEBTS INVOLVED I want now to give the view of a recognized British In spite of denials by certain of the administration's authority, Sir Arthur Salter, K. C. B., M.P., as distributed by spokesmen that the Anglo-American trade· pact is the first, the National Peace Council of London, concerning the Anglo­ and a most important, step toward further reduction of the American trade agreement now pending. He says, in part: war debts, statements from responsible sources in Great Brit­ ain certainly show· that they regard the proposed trade treaty As very important consequences, political even more than eco­ nomic, are likely to follow (the signing of the agreement), a few in that light. Not only is the treaty looked upon abroad notes on the situation may be welcome. as one avenue to a further reduction of the war debts but Mr. Cordell Hull has for some years been engaged in negotiating also. as the method of tunneling under the Johnson Act, a series of bilateral trade agreements, of which the most im­ portant perhaps is the one with Canada. These treaties provide which prevents new loans to nations which have defaulted for the reduction of tariffs, and in some cases the removal of other their debts to us. Such a method could not be provided in 1938 CONGRESSIONAL RECORD-· HOUSE 5327 the actual trade agreement itself, ·of course, but closer trade BENA'l'OR LEWIS' VIEWS ties would surely lead in that direction. If this evasion of This contention that the British trade treaty involves much the Johnson Act could be accomplished, we would be expected more than a purely economic agreement is further supported to become the banker for the world, to pile up another mass by Senator J. HA:r.m.ToN LEWIS, whip of the Senate Demo­ of new loans which, in turn, would have to be defaulted be­ cratic majority. On June 8, 1937, Senator LEWis told the cause of our inability to accept repayment in goods or serv­ Senate that the European debtors of the United States Gov­ ices. It is also the common View of foreign diplomats that ernment are seeking a security pact with this country in if we can be inveigled into trade treaties, new loans, and exchange for payments of their obligations ~ He stated fur­ other economic entanglements, we will be involved thereby ther that Count Paul Van Zeeland, Premier of Belgium, would in all of the political problems of the world, with the neces­ make such a proposition to President Roosevelt when they sity, in event of con:flict, of taking sides and participating in conferred at the White House late last June. Senator LEwiS the foreign wars. said: DAVIS DISCUSSES BRITISH WAR DEBT Now that Mr. Chamberlain is the Premier of Great Britain, we have reason to know that the Governments of England, France, The London Sunday Dispatch of May 2, 1937, stated Belgium, particularly, and such other governments as present a bluntly that Britain's defaulted war debt to the United States parliamentary form of administration, will say that while it is true was discussed at length in secret conferences between they are compelled to spend large sums on armaments in defense Chancellor of the Exchequer Neville Chamberlain and Nor­ against dictatorships, such expenditures are to the benefit of the United States • • •. man Davis, President Roosevelt's Ambassador at Large. The Before the proposed trade treaties with these lands be concluded article, which was prominently displayed on the front page of there should be a specific contract as to what the terms for adjust­ the Dispatch under big headlines, said in part-: ing the debts shall be. · Secret talks between Chamberlain and Davis in the last few Senator LEwis' statements were in the nature of a prophecy, days may lead to closer political and economic cooperation between ·since proved true. Britain and the United States. • • • Chamberlafn told Davis, • • .• that the British Government THE HUNGARIAN PROPOSAL Is prepared to consider any definite proposals Roosevelt may think On March 28 President Roosevelt sent a message to the fit to submit; the war debt was discussed at length and it is under­ Congress transmitting the proposal of the Hungarian Gov­ stood proposals will shortly be considered for a considerable scaling down of the debt and an agreement for payment over a long period ernment for a settlement of its post-war relief debt to the of years. · United States. The President recommended that the Con­ Settlement of Britain's war debt is likely to be a part of a new gress e:!.ve the most careful consideration to the Hungarian trade agreement with the United States, preliminary details of proposals. "They represent a noteworthY wish and effort which were discussed when Runcimen (Walter Runcimen, president of the British Board of Trade) visited Roosevelt. of the Hungarian Government to meet its obligations to this The United States has a big trade balance in her favor, but the Government," he said. British Government is prepared to maintain this, provided satis­ The original loan to Hungary was made May 29, 1920, and factory arrangements can be made for liquidating the war debt and assuring Britain credits for supplies in event of war. · the sum was $1,683,835.61. Hungary has paid in interest Davis has already sent long secret reports to Roosevelt. the sum of $403,545.94. She has also paid another small sum of $753.04 for the purpose of reducing the 'principal to Of course, war-debts settlements could not be made a part a certain :figure. of the trade treaty, but tacit understandings are not unknown .in international diplomacy. Hungary's proposal is that she will repay the total sum of her original loan, less all the interest and other paiments TREATY FORERUNNER OF ALLIANCE she has made, provided she is given a term of 30 years in There is a good deal of basis for the belief which prevails which to liquidate the balance, without interest. This would with many that a strong propaganda in the United States for mean that the debt would be funded at approximately an alliance between the United Kingdom and the United $1,281,536.63, and that sum divided into payments covering States is in prospect, of which the pending trade treaty would a period of 30 years, without interest charges, would require be an important forerunner. There are several aspects of the Hungary to pay about $39,000. a year. negotiations which support this belief. While the claim is made that Hungary desires to liquidate On last January 25 the Washington Herald printed an this debt to the United States along with the liquidation of article stating that-- her debts to other governmental and private sources in Secretary of State Hull announced last night the United States Europe, certain facts remain to be considered. will consider reducing tariffs on supplies for its war vessels in One of these important facts is that Hungary, upon her negotiating a reciprocal-trade treaty with Great Britain, as he made public a supplemental list of manufactures and products cf .the first payment under · this proposed settlement, would im­ United Kingdom to be considered for possible reduction. mediately pass .from under the limitations of the Johnson · In view of the international situation, the inclusion of possible Act, and would be enabled to float new loans in this country concessions on supplies for war vessels was considered significant in to any extent to which· American capital might be foolish view of other developments pointing definitely to stronger Anglo- American ties. · · · enough to go. These were: Another important fact is that to accept this proposal . 1. Reports that the United States has reached a secret agreement from Hungary would set up a precedent which would make :wtth B~tain to recognize Italy's :Ethiopian empire if Britain does this first--as a move to encourage Italian support for European peace. it possible for all our other debtors to demand similar treat­ ment. While such treatment might not 'Qe as attractive to It has since developed that Great Britain is ready to recog­ France and Italy as it would be to some of our other debtors, nize.Italy's conquest of Ethiopia. it would greatly benefit Great Britain. The British funded 2. Persistent reports that the President has decided to name debt, after reductions already granted. amounts to about Adolph Berle, Columbia U~lversity law professor and White House $<1,600,000,000, against which J;Jritain has paid, roughly, adviser, as Assistant Secretary of State, to handle public-relations policies. · $2,000,000,000 in interest. To credit Great Britain with all of her interest and other payinents against the principal Berle has since been nominated by the President and con­ would mean to split her present debt in about half, give her firmed by th~ Senate for this position. 30 years in which to pay off the balance, without interest, The supplemental list embraced fuel oil for ships, ships' stores, and at the same time to put her in position to negotiate new sea stores, or legitimate equipment on vessels o:f war of the United States • • • or vessels engaged in foreign trade between the loans in the United states because she, too, would pass from Atlantic and Pacific ports of the United States or between the under the limitations of the Johnson Act. United States and any of its possessions • • •. DOES PAST EXPERIENCE TEACH NOTHING'l State Department omcta.Is declined to comment on the reports from London that this Nation will recognize tbe new Italian empire This Hungarian offer constitutes the first step in con­ 1n Ethiopia if Britain takes such action. firmation of the reports that have be.en coming out of 5328 CONGRESSIONAL RECORD-HOUSE APRIL 12 London for more than a year to the effect that the anxiety The second fact is that there can be no production and of the Roosevelt administration to put over its reciprocal­ distribution-in other words, no business-unless the goods trade policy had rendered it favorable to a further scaling and services produced can be consumed by somebody some­ down of the war debts and post-war debts, to the fiotation where. In other words, there would be no need and no of new loans by foreign governments in the United States possibility for production and distribution capacity if there for armament purposes, and to the further extension of were no consuming capacity to use up the goods and services trade credits abroad. produced. Apparently our experiences during and since the war have PRODUCTION ALONE GENERATES PURCHASING POWER taught some of us nothing. The fact that we loaned our Consuming capacity is composed of people plus purchasing foreign customers more than $29,000,000,000 with which to power. We must, of course, have the people to use the goods buy our goods, only to lose both the goods and the money, and services. Their capacity to use is necessarily limib::id appears to have made no impression upon those imbued with by their capacity to purchase the goods and ser-lices they the idea that all the countries· and all the peoples of the de&re. - world are just one happy family in which each member must · In all countries the great masses of the people derive their share and share alike with every other member. purchasing capacitY-in other words, their income-from The very action of Mr. Roosevelt and Mr. Hull in encour­ wages and salaries paid them for their work and from divi­ aging the Hungarian offer of settlement indicates a well­ dends paid them for the use of their capital. It is only in defined plan on the part of the administration to persuade the process of production and distribution of goods and the taxpayers of this country, when it seems feasible, to services that wages, salaries, and dividends are created in accept a further reduction of the already thrice-reduced war America. Any condition which stops or retards the process and post-war debts. At the same time we face the ines­ of production and distribution of goods and services im­ capable fact that we cannot secure repayment of the mediately causes a reduction in the volume of wages, salaries, twenty-nine billions already loaned because we cannot ac­ and dividends flowing out of that process. cept payment in goods and services, except to the grave . This, in turn, immediately reduces the purchasing power of injury to our own industry and grave harm to our own wage the ultimate consumers, and the demand for goods and serv­ earners, and that we could not hope for repayment of any · ices diminishes. In turn this causes a condition of under­ future loans for exactly the same reason. consumption, which is sometimes called overproduction. A THE DOCTRINE OF GENUINE RECIPROCITY further slowing of production and distribution necessitates Mr. Chairman, I have proven that the Roosevelt adminis­ more lay-offs of wage earners, and the closing or the slowing tration has a domestic policy of extreme nationalism and a down of more factories. Such a condition constitutes the foreign policy of extreme internationalism. This lack of · downward spiral of depression. It is in such a downward consistent policy can do but one thing-wreck the country. spiral we are now caught, and from which we must find a I believe in the policy of moderate nationalism, both domestic way out. and foreign. LOW PUJtCHASING POWER OF FOREIGN WORXERS The doctrine of reciprocity based upon a sound and mod­ In those countries controlled by ruling classes content to erate international trade is vastly different from the inter­ permit the masses of the workers to live on low levels and to nationalism underlying the present reciprocal-trade policy. work long hours for low wages the per capita purchasing The Roosevelt administration was not the first to employ power is, of course, very low. The products of this cheap and reciprocity. We find the doctrine embraced as far back as miserable labor must find markets outside the country of pro­ the Republican platform of 1892. The theory of reciprocity duction. · Hence the frantic search by the Oriental, Asiatic, based upon a sound economic interchange of goods between and some European countries for world markets. nations was as clearly stated by the Republican President, REPUBLICAN TARIFF POLICY William McKinley, as it has ever been explained when he said Now, the whole philosophy underlying the Republican in his last speech, delivered on September 5, 1901: policy of protective tariffs is this: By sensible trade arrangements, which will not interrupt our Commodities produced in countries where labor is worked home production, we shall extend the outlets for our increasing long hours, paid low wages, and is condemned to low living surplus. • • • We must not repose in fancied security that . levels can be sold for very much less than similar commodities we can forever sell everything and buy little or nothing. • • • We should take from our customers such of their products as we produced in countries where wages are high, hours of labor can use without harm to our industries and labor. • • • The shorter, working conditions better, and living levels much period of exclusiveness has passed. • • • If perchance our higher. It is necessary for those more enlightened countries tariffs are no longer needed tor revenue or to encourage and pro­ to protect their wage earners, their producers, and distribu­ tect our industries at home, why should they not be employed to extend and promote our markets abroad? (Address by President tors of goods and services from the unfair and deadly compe­ McKinley, Buffalo, N. Y., September 5, 1901.) tition of these foreign products of cheap labor. To accomplish This kind of reciprocity takes into consideration the rela­ such protection a tariff duty is levied against importations of tionship between wages and prices; that the only way wages these cheap foreign commodities to bring their selling price can be earned is through the production of goods and serv­ in America up to the fair selling price of the similar com­ ices; and that only through production can purchasing modities produced by higher-paid, shorter-hour, better­ power be created. I would like to explain in more detail conditioned American workers. just what I mean. Practically all commodities coming in from abroad which are not competitive with the products of American factories RELATION OF WAGES TO PRICE and American farms are on the free list. Against them, under The first fact is that the total costs of the production and our tariff laws, no duties are levied. These comprise a very distribution of all goods and services clear down to the point large and valuable market for· foreign countries. According of delivery to the ultimate consumer must be recovered in to the Department of Commerce, in 1937 they comprised mqre price. Those costs include wages, salaries, dividends, in­ than 58 percent of our total import business. Total importa­ terest on loans,. taxes, overhead costs, profits-everything, tions amounted to $3,012,487,000 and the free-list items The ultimate consumer must pay them all-and it is the sum amounted to $1,765,397,000. total of all of these elements of cost and profits that make What is happening under the reciprocal-trade policy is a up the price. Of these cost elements in American industry, lowering of the duties on competitive goods coming in from wages comprise, on the average, about 60 to 65 percent. these low-wage, long-hour countries. Now they are in many The balance is made up of overhead, interest on borrowed instances able to undersell the American product and thus capital, plant maintenance and replacement, taxes, adver­ compel either · a closing of the American factorieS manufac­ tising, insurance, and various other elements. turing those products or a lowering of wages and a lengthen- 1938 CONGRESSIONAL .RECORD-HOUSE 5329 ing of hours in order that the American-made goods can meet hour commodities to the injury of our high-wage, shorter­ .the price competition of the foreign product. .hour workers. HOME MARKET MOST IMPORTANT AMERICAN WORKERS THREATENED Another fundamental fact underlying the Republican pro­ It simply is not possible, by reason of the very funda­ tective tariff policy is that our home market is by far our .mental facts of the case, for us to open our doors to this most important market. Over the history of the !republic influx of goods produced by miserable cheap foreign labor our foreign trade has provided an outlet annually for about without taking jobs and wages from our own citizens; with­ 7 percent of our total production. Today that figure has been .out closing up some of our own factories and without serious reduced to less than 7 percent. Therefore it must be recog­ if not fatal effects upon our own economy, now bled white by nized that in our home market, through the ·purchasing power the strain of these years of depression. American agricul­ of our own people, must be found the outlet for 93 percent of ture and American-industry are so weakened by the burdens our products of farm and factory. they have carried through these years that now every added PEACE NOT PROMOTED BY TRADE AGREEMENTS burden, every dollar's worth of foreign competition, is 10 Much has been said by the new dealers about raising the times more serious than would be the case in normal times. living standards of other nations. If we could do that it With wars threatening the peace of the world, with the would be a marvelous thing. But the fact is that until we struggle for world markets more frantic than ever before in have managed to raise the living standards of those of our the history of mankind, and with the ruthlessness of dic­ own people who are now out of employment and · who are ·tatorships crushing large portions of the world, it behooves living on the ragged edge of nothing under governmental re­ us to take care of our own people, to see that they have jobs .lief, we should_not .attempt.to raise the living standards of and income. If our own employable wage earners ha.d work the peoP.le of all oth~r c.ountries at the expense of the jobs and wages so they could buy all of the goods and services and the living standards of our own. they need and want, we would have very little surplus to Much has also been said by the new dealers of softening send abroad-no more .than enough, indeed, to balance the the mind of the world toward peace by the good-neighbor amount of commodities imported under the free list. example of free and open international exchange of goods. In the direction.of a continued national self-containment A beautiful theory, but the stern fact remains that since the lies the future of America· if we are to survive as a free reciprocal-trade policy has been in effect, wars of aggression republic; if our people are to be employed, contented, and . have continued and increased. The most stupendous arma­ happy; if we are to continue a virile people able to protect ment race ever witnessed on earth is now under way, with ourselves against any attempted aggressions by any combi­ the United States as a participant. And, too, if to be the ·nations of other nations. Thus, seeking peace with all other good neighbor we must give up our own house, discharge peoples, we will help where and as we can to raise the· ideals our own wage earners, and starve our own family in order of the world without sacrificing our own. [Applause.] that the neighbors may come in and take possession of our Mr. . TABER. Mr. Chairman, I yield 5 minutes to the table and our beds--then such a good -neighbor policy is gentleman from Michigan [Mr. HoFFMAN]. not in accord with the old adage that "charity begins at THE LABOR BOARD IS RmiNG FOR A FALL .home." The fact is that such a policy is not a good-neigh­ Mr. HOFFMAN. Mr. Chairman, -yesterday the attention bor policy at all. It is a mistaken policy of ·visionary theo­ of the House was directed to three recent orders of the .rists who believe that the oriental, the Asiatic and the Euro­ ·Labor Board, by which it was ordered that Inland Steel of pean concepts of these matters are . the same as our own, Chicago ,_and Indiana, Republic Steel Corporation of Ohio, which they are not and will not be for many generations to and the Globe Cotton Mills of Augusta, Ga., sign a written come, if ever. ·contract with C. I. 0. unions if a verbal agreement was NO CONTRIBUTION TO PEACE reached. These orders were made, notwithstanding the fact . If I could honestly believe that this reciprocal-trade policy that none of the companies has as yet come to any agreement as it is now operating, and as it will continue to operate, with the union. · would or could accomplish the ideal of world peace, or even The Board is growing a li~tle overanxious; it is anticipat­ materially contribute to that. end, even though it might in­ ing a trifle, is it not, when it orders an employer to sign a volve some economic .sacrifice on our part, I would support written agreement when no agreement whatever has been that policy. But, on the contrary, I am convinced, and I reached? claim that the evidence bears me out, that not only will thjs Ignoring for the moment the absurdity of such a pro­ policy as it is being carried out not result in a materiai con­ cedure, note, please, that the author of the Wagner Act tribution to the peac~ of the world, but that it will result himself said in his letter to the New York Sun in November finally in our becoming so entangled iri the economic prob­ of 1935 that the compelling of .the signing of..a written agree­ lems of other nations as to involve us in their armed conflicts. ment was not contemplated by the act. We want to be a good neighbor to the world. We want to Note, too, that the Supreme Court of the United States, .set the· rest of the world a good example by attending to our which should have at least as much authority as this Board own business, looking after our own people: pursuing our own of thre~ political appointees; held in April of last year that industriOUs way without interfering With our fellowmen any­ an employer could not, Under the law, be forced to even Where else on the globe, SO long as they do not interfere with make an agreement. . us. · But this is not the end of the Board's folly. The decision coNsmER llri:xxco would seem to be enough to indicate to the average sober­ Consider the action of Mexico. After we had just con­ minded citizen that the members of the Board conceived cluded what, for her, was wi' exceedingly advantageous silver­ themselves to be Stalin, Hitler, and Mussolini, transplanted purchase agreement, she promptly proceeded to increase her to America. Note this other decision rendered shortly be­ 'tari1Is against our products by more than a hundred percent, fore the ones . just referred to. and in some cases by more than two hundred.percent. She The Board. has not only denied the right of free speech also expropriated many millions of dollars worth of foreign to all employers; the right of collective bargaining to any properties, including those of our nationals. Mexico is our and all employees who do not belong to the union which may next-door neighbor. She is within our sphere of influence. be recognized by the Board in a.ny particular case; it not She is within the zone of the Monroe Doctrine. The new only. is doing what it can to assist the labor racketeers in dealers might try their hands at softening the mind of Mex-· collecting tribute from all workers, but it' is going one step ico toward American products before they undertake to farther. soften the mind of the world toward peace by giving away For many years it has been said that every dog was en­ our American markets to the producers of low-wage, long- titled to his day in court. Perhaps the Labor Board woUld 5333 CONGRESSIONAL RECORD-HOUSE APRIL 12 grant a dog his day in court, but, by this latest ruling, it This action, like the others of the Labor Board,-has aroused has refused to an employer the right to be represented in public resentment. Typical is this editorial comment of the court by the lawyer of his choice. Kansas City Star of AprU 5: I refer to the case of Karl H. Mueller, who was employed LABOR BOARD PROCEDURE to represent the Southwestern Greyhound Lines, Inc., at a The Labor Board arbitrarily denied a lawyer the right to appear hearing before the Board. in a case. Judge Merrill E. Otis called it "tyranny" and granted Perhaps Mr. Mueller made the mistake of not learning a temporary restraining order. Here we have an excellent example from the trial examiner the style of suit which he should of the difference between the American courts and the quasi­ judicial Labor Board. wear, the color of the necktie which would be · appropriate; The laws and rules of procedure governing the courts have or perhaps he did not part his hair on the right side. In grown up through centuries of human experience. The objective any event, the examiner, upheld by the Board, decided that of the American courts has been fairness to both sides of any conceivable type of case. The laws governing criminal procedure he did not want Karl H. Mueller to appear before him on favor the accused and lay the burden of proof on the State. They these hearings; hence, he arbitrarily made an order, which recognize the rights of the individual. became the action of the Board, disbarring Mr. Mueller from The Labor Board has served in a judicial capacity for one of the again appearing to defend his client. most important types of cases of the times. Labor disputes in­ volve personal as well as property rights. They spread through a Now it happens that Mr. Mueller had taken a course in network of vital social problems. · If any type of case calls for .legal education. He qualified properly. He was a member the safeguards of court procedure, certainly it is the labor case. of the Texas bar. He_ had been admitted to practice not In this instance the Labor Board disbarred a lawyer for a case only before the State courts, but before the Federal district without a hearing. No explanation was offered until the case went to the Federal court. After giving an explanation, the Labor court, the circuit court of appeals, the bar of the United Board attorneys stood on the Board's right to disqualify any lawyer States Supreme Court. He had been, until his resignation under Labor Board rules. in October of 1937, attorney for the Labor Board. This fits the past record of the Board. Fairness is not its objective. It makes no attempt to adhere to the rules that have It may be that the Board had in mind his competency, his been found to be necessary for the courts. Attorneys for the ability, and his success as an attorney and, hence, did not Board serve both as judge and prosecutor of a case. In fact, the desire to have him appear in this particular case. At any same attorney may work with labor attorneys as prosecutor one event, on March 30, the order was issued. This order was week and sit as a trial examiner the next week. The Labor Board has interpreted the Wagner Act as a one­ issued without any opportunity to Mr. Mueller to appear, sided law that lays all the restrictions on the employers. It has listen to the charges, and to defend himself. acted as a prosecuting agency. It has proceeded on its own rules Having denied to Mr. Ford and to other employers the and not according to legal procedure. · This unfairness may very well account for part of the public right to advise those who wished to work for them that they reaction against the Wagner Act. Certainly it is not serving the need not pay tribute to the C. I. 0., it was but a short step cause of labor or the cause of better relations between employer for the Board to tell the attorney that he, too, would not be and employee. permitted to practice his chosen profession, and then to go I agree with the statement of the Star that this action fits one step farther and deny to him the right to which hereto­ the past record of the Board. I can see no excuse for it, fore even dogs have been said to be entitled. no more than for the many other high-handed activities of Perhaps the members of the Board think that they have this group running around the country disturbing and perse­ already brought to, and established in, this country that cuting American business and labor alike. system of communism or socialism toward which they appear Mr. CANNON of Missouri. Mr. Chairman, I yield 10 min­ to be working. utes to the gentleman from California [Mr. ScoTTJ. Perhaps they were suprised to learn that there are still courts in the land and that the order of Federal Judge Mer­ Mr. SCOTT. Mr. Chairman, this may be a small group, but rill E. Otis, of the United States District Court of the it seems to be a friendly group, and friendliness is what Western District of Missouri, restoring to Mueller his consti­ I want to talk about-cooperation. I wish I had written the tutional right to his day in court and his right to practice his speech out ahead of time because then I could extend my re­ profession, still has force. marks and we probably would adjourn earlier, but for some In handing down the decision, among other things, Judge reason or other I did not write it. Otis said that, while the Board might have certain authority, Mr. LAMBERTSON. I spoke here one afternoon with only it could not say to one man, "You cannot practice." 14, and I think the gentleman has 16. And he also said to the Labor Board: Mr. SCOTT. Well, that is better than 14, anyhow. Before you have a hearing, you say, "I arbitrarily prohibit your . Mr. Chairman, I want to call attention to a problem and it appearance." That is such an act of tyranny that, if a judge said is a serious problem. I do not mean to be facetious about it 1t, it would be the subject of an impeachment. It is the most at all. The problem is the one that faces the United States arbitrary action I ever heard of. so far as its foreign polic'y or foreign relations may be con­ The Labor Board representative in Kansas City told the cerned right now. court that, if Mueller desired a hearing, he would guarantee ·several of us in the Hou5e have been asking the Foreign he would have one. Judge Otis said: Affairs Committee to hold hearings on the subject of our Now counsel appears, after Mr. Mueller is disbarred, and says he neutrality policy and that neutrality policy as it affects other can have a hearing, a hearing after the jury has brought in a nations and us. In particular, some of us have asked for verdict and pronounced sentence. The application for temporary the repeal of the Spanish Neutrality Act, that is the lifting of restraining order is granted. the Spanish embargo. At one time the chairman of the While Mr. Mueller was on his way to Kansas City, he Foreign Affairs Committee said he would hear different indi­ learned that theN. L. R. B. had made an order on March 30, viduals in the country who had views on the subject and who which arrived in Fort Worth April 2, disbarring him from rated more or less as students and authorities on the subject appearing in the case. of our foreign affairs. The chairman of the Foreign Affairs The LabOr Board attorney in Kansas· City justified the Committee has on different occasions spoken on our neu­ action by saying that Mueller had been an attorney for the trality policy and said he did not believe we were getting the Labor Board and had access to its confidential files. But he result we had hoped to get when we passed-the Neutrality Act. admitted to Judge Otis that the Board's order did not make Now the chairman says that the times are too tense for hear­ this allegation. ings before his committee. Is this a case of fiddling while The Labor Board's attorney, Mr. Paul Broderick, also told .·Rome burns? Do we hide under the bed while the robbers Judge Otis that the Labor Board had the authority to exclude loot our homes, saying that we will do something about it any lawyer it saw fit, under its rules. when the robbers leave? Mr. Mueller, through his attorney, said he had no connec­ Now, the effect of the Neutrality Act, as regards Spain tion with the Greyhound case ·while he was a member of alone, is that the United States is denying to a friendly, a the Labor Board staff. legally established, and a democratic form of government, the 1938 CONGRESSIONAL RECORD--HOUSE 5331 right to buy arms and ammunition here to use to defend that the United states would not again go -in to turn the itself against the rebel Franco, assisted by Germany tide of battle, what are the chances of Hitler for the con­ and Italy, but at the same time we are allowing Germany quest of France and the conquest of England, or at le~ and Italy to buy arms and ammunition in the United States. a defeat of England? Then where do we stand? Would we We supply the aggressors, but we deny assistance to the be as safe as we feel we are today? What difference would victims. It is no longer a question of controversy whether it make to us if the British Navy were destroyed or Ger­ German soldiers are in Spain, whether Italian soldiers are manized? Would you people on the east coast feel as secure in Spain, whether German and Italian arms, planes, and then? ammunition are being used by these soldiers and by the The gentleman from New York [Mr. WADSWORTH] made a Franco forces in Spain. This is accepted as fact. Every­ speech on this floor during the debate on the Navy bill. That body knows it. We are continuing to sell to those two coun­ speech was acclaimed by the leadership of the House as prob­ tries, but we refuse to sell to Spain. What is the result? ably the best speech made on the Navy bill. I saw it re­ Each day the papers carry the report that the rebel forces ferred to in the newspapers as the outstanding speech of the are a little closer to the sea, Franco is a little closer to victory, Seventy-fifth Congress. What did Mr. WADSWORTH say? He and there is a pretty good chance that in a short time he w111 said that due to our policy which we had pursued in the past, have divided the existing Spanish Government into two sec­ the United States, in refusing to cooperate With the rest of tors, and probably, following that, will come the success of the world knew that the world was not going to cooperate the Franco forces, and Spain will be turned into another with the United States if we ever had trouble, and he said if Fascist ally of Hitler and Mussolini. we do have trouble ever, we will be by ourselves, defending Mr. BARRY. Mr. Chairman-- ourselves. Then he turned to the rest of the world and noted Mr. SCOTr. Let us not get into an argument. what was going on. He noted the Japanese invasion of Mr. BARRY. Mr. Chairman, will the gentleman yield for China; he noted the invasion of Spain; he noted the ambi­ a question? tions of Hitler and of Mussolini and of Franco; and he said Mr. SCOTr. I yield for a question, to this Committee: Mr. BARRY. Has not our policy so far kept us out of Let me say to you, ladies and gentlemen of this Committee, that getting involved in Spain; and, after all, is not that our prime when their ambitions are achieved in Europe and in Asia they consideration, regardless of whether Franco wins or the will turn hungry eyes to South America- Loyalists win? And I remember the applause that greeted the statement Mr. SCOTr. The question of whether our neutrality of the gentleman from New York when he said: policy has kept us out of military involvement is open to And then, ladies and gentlemen, when they turn to South question. But our policy has involved us on the side ·of America they are at our back door, when we will need this navy Franco and I do not like it. We are helping Franco right to defend our country. - now. I do not approve of a policy that lends assistance to, Mr. RABAUT. Mr. Chairman, Will the gentleman yield? that encourages aggression, and assists Fascist nations to set Mr. SCOTr. Yes. up Fascist puppets. I think our own national security is Mr. RABAUT. We talk about having them at our back endangered by every new Fascist triumph. door. Look at Mexico, where we have recognized every cut­ Mr. BARRY. If it cannot be denied that we are not throat who has been able to get control of their army. We getting mixed up in the war, why not go ahead with what pay no attention to their carrying on in a manner contrary we have today? to all the principles for which this country was founded. Mr. SCOTr. That is exactly what I wanted to discuss. With our help in silver purchases actually we have sup. We may be getting ourselves mixed up in a very serious ported their actions. But while murders, and so forth, re­ situation. ceived no attention from us, oil and what goes with it readily Now, suppose Franco is successful in Spain. I want each engaged our State Department. one of you in some way or other to get a copy of Hitler's Mr. SCOTr. At the same time, I do not believe that the book, Mein Kampf, and see what Hitler himself says that. he gentleman and I want to see Hitler or Mussolini or the has in mind. Compare his actions and his successes with his Japanese establish colonies or bases in South America or ambition and view our future in relation to both. take any South American country into their Rome-Berlin­ He has accomplished the program set forth in that biog­ Toyko axis. raphy and is doing a complete job of it. Suppose that he, Mr. RABAUT. The gentleman is right. I am talking Mussolini, and Franco are victorious in Spain, the question about what we have at our back door. immediately arises, in what position does that put France? Mr. SCOTr. Let us not argue about that, because there is When the policy of encircling France will have been accom­ a difference of opinion existing in respect to Mexican affairs. plished, which has always been the goal of the German mili­ But the gentleman from New York [Mr. WADSWORTH] said: tary forces, how long will France last against this alliance? If they do succeed in encircling France, and if Germany When they come to South America then .it will be necessary for the United States to have a strong navy to keep them away should continue With her Mitteleuropa policy, taking Czecho­ from us. slovakia, which is undobutedly the aim, where does that put France as far as her defense is concerned, and then where Now, this question has arisen in my mind: Is that the best does it put England? Can England hold out against them? thing that the people of the United States-is that the best Everybody says that we went into the World War in 1917 thing that the Government of the United States can figure and turned that war from a German victory into an Allied out as far as the defense of our national security from foreign victory. attack is concerned? Mr. BARRY rose. Mr. BARRY. Mr. Chairman, Will the gentleman yield? Mr. SCOTr. Oh, I do not want to get into that question. Mr. SCOTr. Is that policy of futility_:_that policy of Mr. BARRY. I just want to ask a question. defeatism that says that we cannot find any better way of Mr. SCO'IT. I know. I agree that it was American entry protecting ourselves than building up a big navy to wait until into the war that turned the tide of battle. The Kaiser's an attack comes .to our own borders--the best we can do? Is ambition was known to practically the entire world and we that the· best that we can figure out? know that Hitler's ambition parallels the Kaiser's ambition The CHAIRMAN. The time of the gentleman from and we know also that Hitler's possibility of succeeding iri California bas expired. his ambition is a great deal greater than the Kaiser's was. Mr. CANNON of Missouri. I yield the gentleman 5 addi­ He is closer to a realization of that now than the Kaiser tional minutes. ever was and if, after encircling France, cutting off her other Mr. BARRY. Mr. Chairman, will the gentleman yield? allies, or the possibility of help and aid and, due to the fact Mr. SCO'IT. I yield. 5332 ·coNGRESSIONAL RECORD-HOUSE APRIL 12 Mr. BARRY• . I listened to the gentleman's speech over the crease of the NavY bill. Why not try peaceful methods? radio and I have been reading about him in the Daily Worker The more nations of the world there are at peace the less and some other newspapers. I have a thorough idea of what need is there for us to arm. Only as war develops all his thoUghts are on foreign policy. He talks about Hitler and over the world is it necessary for us to rearm. If the world Mussolini governing Europe, and changing the map of Europe. were at peace we wouldn't have to arm. Why cannot we Who cares, so long as it does not affect us? Assuming all try to help the world back to peace so that we can begin things you anticipate happen and that Mussolini and Franco to cut the cost of war preparation. That has always been want to keep on going, is not the time to get worried and the experience. start to determine on our stand when they start looking to In addition to that, just by way of caution for whatever this continent? · -it amounts to, I hope that various Members of the House Mr. SCOTr. Did the gentleman vote for the increase of will get a new magazine that appeared on the newsstands on .the NavY bill? the '31st of last month, a magazine called Ken, put out by Mr. BARRY. Certainly. the editors of Esquire. In it is an article entitled "Exposing Mr. SCOTr. Why? the Peril .at Panama." It may interest you. The author Mr. BARRY. Because I want to be ready. With all the went to the Canal Zone, investigated, and- wrote as a first- other nations of the world arming to the teeth, we are in · hand observer. We have known of the activities in the past danger unless we increase the strength of our NavY. of the Japanese in the Panama Canal Zone. What we have Mr. SCOTr. We are in more danger of being attacked not been too sure of is. the activities of the German and today than we were before the gentleman was asked to vote Italian agents in the Panama Canal Zone. This writer calls for the increase of the NavY. attention to the activities of these nations in the Panama Mr. BARRY. Who is willing to attack us? Canal Zone. These three nations have their espionage Mr. SCOTr. There is more danger to our national agents in the Panama Canal Zone, which is the life line of security now than there was at the time the gentleman voted our defense if anything should happen upon the east coast. for the bill to increase the NaVY. There must be or we would These three nations not only have their espionage agents not have voted that billion-and-a-half-dollar Navy bill. there but the three groups of agents cooperate and meet Mr. BARRY. What nation is going to attack us? together. For what purpose? The Japanese agents have Mr. SCOTr. What country wants to? - We know of an been photographing down there for years. The Italian alliance between Germany, Japan, and Italy which will un­ agents come in there to establish friendly relations with the doubtedly be joined by Franco when he completes his con­ · country of Nicaragua, where we expect some day to dig a quest of Spain. canal. The German agents go down there for the pur­ · Mr. BARRY. Who is going to Italy now? Great Britain. pose of organizing their btmds,- and they did organize one Italy and Great Britain will work out a situation. That is down there. Why do these three groups meet together why I spoke of the fallacy of united democracy. under the general chairmanship of the ex-Austrian consul Mr. SCOTr. If the gentleman does not mind, I would like in Panama? . to make my own speech. The gentleman is going on to speak That article appeared in a magazine of national circula­ of the inability of democratic nations of the world to co­ tion. I will not attempt to vouch for a single thing in the operate; that is what the gentleman is driving at. I am ask­ article, except I know the man who wrote it. I know that ing that we try to cooperate with them in an attempt to stop he is a good reporter. aggression and preserve the peace of the world. I would He says that if the American military and naval intel­ rather try to secure cooperation with them in an attempt to ligence officers will rip a thread in a mattress in the up­ maintain world peace -than continue our present policy of stairs room at Calle lOa in Colon, occupied by Lola Osawa, ·cooperating with Germany and Italy in the rape of Spain. and stick their hands into the mattress they will find photo­ Mr. BARRY. How about Great Britain and Italy? They graphs of extraordinary secret military · and naval impor­ are getting together now. tance. He says he saw four of them. Mr. SCOTr. They are not together yet; and one reason, He says that Japan, Germany, and Italy are paying for as I see it, why it was necessary for Great Britain to turn war materials for Nicaragua. to Italy and to nations with whom we know they could He says that Japanese naval reserve officers work as fisher­ never enter into any agreement that would be binding be­ men and barbers and meet together regularly. cause those rulers do not live up to their agreements--the He described a meeting between Japanese, German, and ·thing that made it necessary for them to tum to Italy was Italian espionage agents on December 13, 1937, at the home the fact that the United States would not assume a position of August Jacobs-Konstein, Panamanian merchant and of leadership in coo-peration among the peace-loving nations Austrian honorary consul. of the world. But read the article for yourself. What is going on? Why Mr. BARRY. We would not furnish arms. do they do this? I think they are getting ready for what Mr. SCOTT. I am not urging a military cooperation, I the gentleman from New York [Mr. WADSWORTH] mentioned. am urging peaceful cooperation which has never been tried Shall we wait for them? in the world as a method of preventing the outbreak of I know that this reporter would not report things that wars. If the peaceful nations which supply war materials he did not see. The article is full of other information that to the Japanese, and the United States is among them; if Members of the House might very well read with profit. Cer­ the nations that supply war materials to Germany and tainly it cannot be laughed off and the statement made that, Italy, and the United States is among them, if the nations "It is just a magazine article." Will you read it, then recall that supply war materials to the aggressor nations would what the gentleman from New York said, that those three stop supplying these materials, or would supply the victims nations constitute a possible, almost a probable, threat to of aggression, they would not be able to carry their f:lghting our national security, and that the only thing the American very much farther. people can find as an answer to that threat is to build a big Mr. BARRY. Mr. Chairman, will the gentleman yield? navy? · cannot we do anything in an attempt to maintain Mr. SCOT!'. No; I cannot yield further. the peace of the world? Remember that in 1932 the Demo­ In addition to the situation in Europe to which the gen­ cratic Party and the Republican Party said, "We signed the tleman from New York called attention and said we must Kellogg Pact and if at any time we find that the Kellogg get ready for-I agree that the situation is there and that Pact is being broken by one or more nations,'' the Demo­ we will have to get ready for it, but I think that we might cratic Party and the Republican Party would favor the call­ :figure out some other way of stopping the threat to our ing of a. conference of the powers signatory to the Kellogg national security than by building some more ships and Pact to see if something could not be done to maintain the hiring some more admirals tha.t were provided by the in- peace of the world. That is what I want to do. 1938 CONGRESSIONAL RECORD-HOUSE 5333 · Why can we ·not do that tn· place of putting all of our The Federal Government, according to the report sub­ reliance on admirals and battleships that the gentleman mitted by this committee on· agricultural appropriations, from Texas says are obsolete? Why can we not give leader­ makes this statement: ship to the 90 percent of the people of the world who want The Government has acquired or contracted to acquire lands tn peace? acreage totaling 24,772,000 acres. [Here the gavel fell.] Every acre of that land was supposed to be submarginal. Mr. LAMBERTSON. Mr. Chairman, I yield 10 minutes Every acre of that land is going to have to be treated in to the gentleman from Oklahoma [Mr. FERGUSON]. some way to restore it to usefulness. The only useful pur­ Mr. ·FERGUSON. Mr. Chairman, the two ·Members I pose it can serve is by restoring the natural grass. want to talk to mostly, the chairman of the Subcommittee Mr. Chairman, it is a very difficult thing to restore grass. on Appropriations, and the ranking minority member are If you just turn it out it begins to blow and destroy the present on the floor, and I hope that other Members will read neighboring land. If you finally get it through cultivation my remarks in the RECORD. into weeds, so that it does not blow any more, the natural Tomorrow when this bill is read I propose to offer an processes of restoring that to the same productivity as sur­ amendment on page 35, line 6," striking out "$211,828" and rounding grass lands, after it has once been cultivated, re­ inserting in lieu thereof "$226,828." This is an increase of quires from 40 to 50 years. Experiments taken. and obser­ $15,000, and restores that figure to the Budget estimate. vs.tions made in the plains country demonstrate that it I shall offer another amendment, on page 35, line 18,. to requires from 40 to 50 years to restore to anything like the strike out "$294,993" and irisert in lieu thereof "$304,993", productivity of land that has not been tilled. which restores that figure to the Budget estimate. They know very little about proper methods of restoring I feel this has been an oversight on the part of the com­ grass. So, with this proposition, I called on the President mittee. I appeared before. the Subcommittee on Appropria­ of the United States and tried to paint this picture.. He tions arid I may say I have heard several members of that was kind enough and. interested enough to ask the Budget committee at various times express their interest in these to approve an item last year of $80,000 to buy some land in items, which have to do with carrying on regrassing experf­ conjunction with the already existing field station at Wood­ ments. · ward, Okla., and construct a small dam on a creek to fur­ The Federal Government a good many years ago recog­ nish water in this grass breeding experiment. The com­ nized the fact that grass was one of the vital elements in our mittee and the Congress last year approved this item, the agricultural economy. It is a revelation to read from a bulle­ land has been purchased, and the work has been started. tin issued in 1898. This is what the bulletin, put out by the The committee, I hope through an oversight, has deleted Department of Agriculture, said in 1898: from this bill every cent that would have gone toward the maintenance and · operation of these investigations. You In a short time every acre of free grass was stocked beyond its fullest capacity. Thousands of cattle or sheep were crowded on notice on page 17 there appears: "Plus $15,000, Budget in­ the ranges where half the number was too many. The grasses crease disallowed." were entirely consumed; their very roots were trampled into dust This is for maintenance and operation of facilities pro­ and destroyed. In their eagerness to get · something for nothing 1938 in speculators did not hesitate at the permanent injury, if. not total vided in for regi'assing and grazing investigations ruin, of the finest grazing country in America. • • . • It is not dry-land areas. yet too late to remedy the evil, but no time is to be lost. On page 18 ·you find this item, "Plus $10,000, Budget in­ As I stated, that was in 1898, following a series of dry crease disallowed," for grass and other forage crops inves­ years such as we have just experienced. The grasses were tigations for the southern Great Plains. very seriously depleted and the ranges vere very nearly Mr. ZIMMERMAN. Mr. Chairnian, will the gentleman destroyed. In 1901 the Department started some very thor­ yield? ough investigations of the uses of native grass, the possibility Mr. FERGUSON. I yield to the gentleman from Mis­ of breeding those grasses, and finding ways and means of souri. planting grass that is indigenous and restoring it when the Mr. ZIMMERl\fAN. In the State of Oklahoma you have ranges have been destroyed. This work was started, some a great university and a fine agricultural department in very fine experiments were carried on, and most of the knowl­ that university. Why should not your university out there, edge we have today · is the result of those experiments that at the very place where this need is so great, carry on were carried on back in 1900. When the_ dust storms began these experiments and give this information to the people to call the attention of the Capitol, when the dust was set-:­ of Oklahoma so they can carry on this program them­ tling on this very dome, I started out to interest the Depart­ selves? ment of Agriculture in this problem o.f regrassing. Mr. FERGUSON. This is not a question that is confined Mr. LEAVY. Will the gentleman yield? to Oklahoma. It is not at all a local question. It is a ques­ tion that extends from the northern boundary of the United Mr. FERGUSON. In just a moment when I read this States to the Gulf of Mexico. We have a dry-land agri­ statement. cultural station that has been in operation for over 20 years. The Department of Agriculture very kindly created a com­ It is located in the heart of this area and operated by the mittee made up of Mr. Richey, chief of the Bureau of Plant Federal Government. This station has carried on these ex­ Industry; Mr. Gray, Resettlement Administration; Mr. periments. It does not take a great deal of additional per­ Black, Bureau of Animal Industry; Mr. Enlow, of the Soil sonnel, but it takes some additional personnel to carry on Conservation Service; and Dr. McCall, of the Bureau of these grass-breeding experiments. Plant Industry. This committee, after surveying the sit• [Here the gavel fell.] uation in the Department, made this statement in a letter to the Secretary of Agriculture: Mr. CANNON of Missouri. Mr. Chairman, I yield 2 addi­ tional minutes to the gentleman from Oklahoma. 1. The importance and necessity of regrassing extensive areas in solving the economic and social problems of the Southern Mr. FERGUSON. They have already started some of this Great Plains, together with the lack of adequate information and work on a very small scale on very small plots at the existing materials necessary to do this job effectively, justify a comprehen· station. They wanted to expand that work as soon as more sive grass research program in that area. land, which is now available, became available. The money Here is a committee made up of all the affected agents that was in the Budget estimate makes this possible. For in the Department of Agriculture that recognized the very instance, they have found some buffalo grass plants with the vital necessity of knowing how to proceed in solving this seeds standing erect so the plants may be harvested and problem of regrassing these vast areas which are subject to planted from seed. If that plant could be developed a great wind erosion. deal of our problem would be solved. At the present time 5334 CONGRESSIONAL RECORD-HOUSE AJ>RIL 12 bu1falo grass seed cannot be gathered commetcially. The It is really a reprehensible proposition. Take, for in­ only way it can be planted is by dropping pieces of sod and stance, these· big industrial districts, these heavily popu­ rolling it in. .However, they have gathered commercially lated areas,· they are in extremely vulnerable position, and grama grass seed and succeeded in resowing acres to grama I am talking about Massachusetts, New Jersey, Connecticut, grass. They have developed several types of rescue grasses, as New York, and all of the States on the eastern seaboard. you may call them. These native rescue grasses, sometimes The additional amount that the Senate has put in is 40-odd called giant reed grass and sand drop seed, will grow on million, but I ·want you to realize that this House appro­ regular blow sand, and if these experimenters can get enough priated, in addition and above what they were supposed to seed to get started it will aid in restoring the country to pro­ appropriate, something like a billion and a half for expan­ ductive land. If we do not carry on this program, if we do sion of the Navy. This appropriation of $46,000,000 will not find out how to regrass, the 22,000,000 acres we have make the coast safe, and this means the coast all the way purchased in the last 2 years will become a drain and detri­ from Portland, Maine, around to California. ment. If we do carry on the program the economic value of Mr. CASEY of Massachusetts. Mr. Chairman, will the this land cannot be questioned, and these acres will add tre­ gentleman yield? mendously to the national wealth. In addition, all the pri­ Mr. MAVERICK. I yield. vate ranges now dangerously depleted may be improved. Mr. CASEY of Massachusetts. The gentleman would not [Applause.] have any serious objections to having Maine taken over by Mr. LAMBERTSON. Mr. Chairman, as my stepmother the enemy? [Laughter.] grew up in San Antonio, I am going to yield 5 minutes to the Mr. MAVERICK. Well, they might get a foothold, and we timid and retiring gentleman from Texas [Mr. MAVERicK]. have to keep it as a matter of form. [Laughter.] SENATE AMENDS HOUSE ARMY BILL BY PROVIDING SEACOAST AND The seacoast defense is in a bad condition from Maine ANTIAIRCRAF'I' DEFENSES down to North Carolina. From North Carolina all the way Mr. MAVERICK. Mr. Chairman, I appreciate very much down to Florida it is in fairly good shape, and New Orleans having time given to me by our brethren on the Repub­ and other gulf cities will be fairly well protected i1 we lican side. I assure them what I am going to say will not develop railway artillery. be any reflection on that great party of theirs. At least not · I now want to bring out a point that has not been brought just now. This is a matter in which both sides of the House out here before, and that is that the Pacific coast has been are equally interested. ·put in good shape. on.account of the so-called "yellow men­ I mentioned the other day on the :floor the matter of ace" or the menace of Japan. ·national defense and the fact that the Senate in considering Now, Japan is pretty busy over in the Orient and will ~ our Army appropriation bill had added something like 30 for a half century or so. It is very likely that the danger or 40 amendments, among which were provisions for sea­ point now is on the eastern coast and not on the Pacific coast defenses and antiaircraft . guns. ·Also, the Senate coast. · added appropriations for various air fields and posts over Mr. LEAVY. Mr. Chairman, will the gentleman yield? the United States. ·Mr. MAVERICK. I yield to ·the gentleman. SEACOAST DEFENSE IN EAST ASTONISHES Mr. LEAVY. I am not taking issue with the gentleman's I have looked into this matter very, very carefully. As statement about the Pacific coast being in good shape so .everybody in the House knows, _I luwe said battleships are far as .fortifications are concerned, because I am not pre­ .worthless, but for today I am going to admit battleships are pared to answer that . except .. to .say that there are . 15;000 all right, for purposes of argument. Now, if you go along miles of coast line in Alaska which is 3,000 more than the the coast of the United States and think of the districts, entire cont.inental United States, and there is not a sem­ for instance, like those of tne gentleman from New York blance of a fortification in that entire coast line. [Mr. BARRY], the gentleman from Massachusetts [Mr. CASEY]. [Here the. gavel fell.] ·and Mr. SHANLEY. of Connecticut, and a good many others, Mr. LAMBERTSON. Mr. Chairman, I yield the gentle­ you will be astonished, as I was, at-the actual condition of man 5 additional minutes. seacoast defenses in the East. I was so astonished by that Mr. LEAVY. There is no pretense of defense of that en­ condition that I believe if the actual-facts were known by tire coast line lying almost at the door of Japan. Does not the American people it might get them a little bit jittery. the gentleman think that is a matter that is entitled to I believe the provisions for those defenses which were serious consideration? put in ·the 'bill by the Senate should be adopted -by · the Mr. MAVERICK. Let me answer· that ·question in this House. The reason I say this is that I want every Member way: Alaska, practically, is a vast, unsettled area. It is an of the House to get a copy of the hearings of the Senate area which by climate is not suitable· to colonization and too committee and read the testimony, which is very brief and expensive when it is considered Japan would have to fight very much to the point, by responsible and high-ranking a real war to get it. officers of the Army. When people attack · a country they want to get the · Let me discuss seacoast defenses. ·People say they are wealthy part of the country, usually the population centers, not so very good, but I want to tell you that as a matter and they are in the eastern part of the United States. There of national defense, if we have a navy .and that navy we have mill1ons and millions of people; and I wiU say this gets sunk, then the Nation is sunk if we. have not good coast to the Congressmen in the East: They really need this de- defenses. Moreover, when you have seacoast defenses the fense, 'and Alaska is not as important as those areas. . . purpose of a seacoast defense is not only to defend that · Mr. LEAVY. Mr. Chairman, will the gentleman yield coast, but that a warship can go out to sea. If your coast further? defense is no good, then the battleships have to stay close Mr. MAVERICK. Of course I yield to my friend from into the shore and there is no chance of their attacking the Washington. enemy at sea. Mr. LEAVY. I again want to take issue with the gentle­ MAKE THE COAST SAFB AT FRACTION OJ' BATTLESHIP COST man's statement about Alaska being a region that could not Now, there are six principal points, starting up at Port­ be either settled in or used as a place from which the whole land, Maine, and extending by Narragansett Bay and Long United States would become vulnerable. Southern Alaska is Island Sound to the Chesapeake-and they are in a defense­ a region where the enemy could readily land and from there less condition. This is really the truth, and anybody who within a few hours by plane get to Seattle and the whole wants to can go down to the War Department and get the Puget Sound region. What I say is not in any way intended facts on this matter. to discount or discredit what the gentleman has said, be- 1938 CONGRESSIONAL RECORD-HOUSE 5335

/ cause I am in sympathy with his argument. The gentleman Mr. MAVERICK. Mr. Chaimlan, I make the same re- ls making a persuasive and a convincing argument. quest. Mr; MAVERICK. Let me answer the gentlem·an by mak­ The CHAIRMAN. Is there objection? ing the point that when the enemy attacks any country it There was no objection. attacks on the basis of railheads or a port or places with Mr. CANNON of Missouri. Mr. Chairman, I ask that the communications for lines of supply, and I do not believe Clerk read the bill for amendment. that the protection of human life in Alaska is as important The Clerk read on page 1 down to and including line 6. as it is in our heavily populated districts. I think Alaska Mr. CANNON of Missouri. Mr. Chairman, I move that the ought to be protected, but I think on account of being a Committee do now rise. frontier, that protection should be done by airplanes rather The motion was agreed to. than by the kind of seacoast defenses I have in mind. Accordingly the Committee ros.e; and Mr. RAYBURN having Mr. SHANLEY. Mr. Chairman, will the gentleman yield? assumed the chair as Speaker pro tempore, Mr. NELSON, Mr. MAVERICK. I yield to the gentleman. Chairman of the Committee of the Whole House on the state Mr. SHANLEY. With respect to the vulnerability of the of the Union, reported that that Committee had had under North Atlantic coast, may I suggest that 80 percent of all consideration the bill H. R. 10238, the agricultural appropria­ the munitions that went across the sea during the World tion bill, and had come to no resolution thereon. War passed over the rails of Connecticut, and southern Con­ EXTENSION OF REMARKS necticut is very vulnerable because we have probably the Mr. CASEY of Massachusetts. Mr. Speaker, I ask unani­ largest munitions plants in the world, while northern Con­ mous consent to extend my remarks in the RECORD and to necticut is the teeming center of the aviation industry. include therein three speeches of 4 minutes' duration, each Therefore, I agree with the gentleman on the vulnerability made over the radio last night, on the reorganization bill by particularly of the North Atlantic coast. my colleague Mr. McCORMACK, my colleague Mr. HEALEY, NEW ENGLAND VULNERABLE-NOT ENOUGH ANTIAIRCRAFT GUNS FOR and myself. UNITED STATES . The SPEAKER pro tempore. Is there objection? Mr. MAVERICK. I thank the gentleman. I do not want There was no objection. to make a spectacular statement so everybody will get ex­ Mr. SHANLEY. Mr. Speaker, I ask unanimous consent cited, but as a matter of fact the military group has plans that the gentleman from Florida [Mr. HENDRICKS] may have for the evacuation of large cities. I do not mean by that permission to extend his remarks in the RECORD. that they are immediately going to do it if war came, but The SPEAKER pro tempore. Is there objection? we have not enough antiaircraft guns in the United States There was no objection. to protect a single suburb of New Haven, Conn. Mr. VOORHIS. Mr. Speaker, on Wednesday last I asked We simply haven't got the antiaircraft guns. The Sen­ unanimous consent to extend my remarks and to include ate amendment provides for antiaircraft guns along with therein the report of a general survey of American youth other necessary provisions. It is not a waste of money-it made by the American Youth Commission of Washington, is something that we absolutely need. D. C. That consent was granted. I have been informed by WHY GIVE THE NAVY 3,000 AND THE ARMY ONLY 2,300 PLANES? the Printing Office that this will occupy three and three­ There is one thing more I want to say before I conclude. quarter page.S and that. the cost of printing will be $170. I This House authorized 3,000 planes for the NavY. We have renew my request and ·· ask unanimous consent to extend my authorized only 2,300 for the Army. remarks in the RECORD by the inclusion of this material. Conservative men, men who know something about air The SPEAKER pro tempore. Is there objection? defense, believe that the United States Army should have at There was no objection. · · · least twice as many airplanes as the NavY. Mr. ECKERT. Mr. Speaker, I ask unanimous consent to What is the Navy trying to do? extend my remarks and to include an Ode to Liberty published . The NavY is the greatest propagandist in the world-at in the Forum. · least it is greater than the Army. The SPEAKER pro tempore. Is there objection? Well, the NavY ·is naturally ambitious to increase its air There was no objection. forces, but we should not permit the Navy to build its air Mr. EBERHARTER. Mr. Speaker, I ask unanimous con­ force out of proportion to the Army. I do not begrudge the sent to extend my remarks in the RECORD by inserting NavY their planes, but let us consider the realities. therein a copy of a radio address -delivered by myself on the To whom does national defense belong? Principally to subject of the Tennessee Valley Authority. the Army, because it attempts to protect a territorial area The SPEAKER pro tempore. Without objection, it is so and does not prowl around the seas far away from home. ordered. Battleships have to go over the world. There wa:? no objection. What we ought to do is to build up the air forces of the Mr. MARTIN of Massachusetts. Mr. Speaker, I ask unani­ United States Army for real national defense, and not ship mous consent to be allowed to include several short tables defense. It is wrong for the NavY to have more planes than in the remarks I made this afternoon. the Army. The SPE~ pro tempore. . _Without obje~tion, it is so All I ask gentlemen and my colleagues to do is this: I ordered. want you to vote for increasing the Army appropriation There was no objection. according to the Senate amendments, if you think it is right. Mr. SCHNEIDER of Wisconsin. Mr. Speaker~ I ask unani­ I believe conscientiously that everybody can vote for this mous consent to extend my re~arks in the RECORD and to because it is necessary; certainly it is not a waste of money. include therein an outline and review by the Wisconsin State [Applause.] Federation of Labor of the effect on the building and con­ Mr. CANNON of Missouri. Mr. Chairman, I yield 15 min­ struction trades of the present policy of the W. P. A. utes to the gentleman from New York [Mr. DicKSTEINL The SPEAKER pro tempore. Without objection, it is so Mr. DICKSTEIN. Mr. Chairman, I shall not avail myself ordered. of this generous offer, but shall wait until I get into the There was no objection. House. Mr. DIRKSEN asked and was given permission to revise and Mr:VOORHIS. Mr. Chairman, I ask unammous consent extend his remarks. to extend my remarks in the RECORD. Mr. MAVERICK. Mr. Speaker, I ask unanimous consent The CHAIRMAN. Is there objection? to extend my remarks and to include therein certain excerpts There was no objection. bom decisions of the Supreme Court of the United States. 5336 CONGRESSIONAL RECORD-HOUSE APRIL 12 The SPEAKER pro tempore. Without objection, it is so helm Hermann, and Ewald Rossberg, for whom a warrant was is­ sued, also were members. ordered. The Federal Bureau of Investigation, with secrecy characteristic There was no objection. of the investigation so far, had refused to divulge any informa­ Mr. FERGUSON. Mr. Speaker, I ask unanimous consent tion regarding the men arrested, and no one in the Bureau would to revise and extend my remarks in the REcoRD and to in­ comment on reports that it had been searching the ranks of the bund in its en~eavor to break up the espionage ring. _ clude therein a report on grass experiments by Mr. Savage, Mr. Dunigan and John F. Dailey, Jr., chief assistant United States of the Department of Agriculture. attorney, likewise withheld confirmation until confronted with a The SPEAKER pro tempore. Without objection, it is so newspaper clipping which referred to Boening as head or "fuehrer" of the Ordnungs-Dienst. The clipping cited him as leader of the ordered. storm troops and quoted him as saying that the uniformed turn­ There was no objection. out of 1,500 at the German Day celebration in Madison Square Mr. CANNON of Missouri. Mr. Speaker, I ask unanimous Garden on October 4 was a record turnout for the corps. consent that the gentleman from Texas [Mr. MAHON] may Boening's present status in the Ordnungs-Dienst was doubtful last night. Volksecho, liberal German weekly published here, re­ be permitted to include in the remarks he made this after­ ported that at a secret meeting of the bund last Saturday it was noon an excerpt from a speech made by Assistant Secretary announced that Boening had been deposed. No reason for his of Agriculture Henry L. Brown, and also a brief table refer­ removal was given, according to Volksecho. The paper, however, said that Boening's removal as "fuehrer•• had brought to light a ring to the matter which he discussed. definite split in the uniformed ranks. The SPEAKER pro tempore. Without objection, it is so · Neither Boening, Herman, nor Unkel, all three of whom were ordered. held nominally as material witnesses against the three men and one woman previously arrested in the investigation on espionage There was no objection. charges, was able to post the requisite $1,000 baU, so all re­ Mr. CANNON of Missouri. Also, Mr. Speaker, on behalf mained in the Federal house of detention last night. Meanwhile of the gentleman from California [Mr. DoCKWEILERl, I ask Leon a_ Turrou, veteran F. B. I. agent, and others assigned to the unanimous consent that totals in the legislative appropria­ investigation, continued their search for Rossberg and others be­ lieved involved in the ring. tion bill may be corrected. The SPEAKER pro tempore. Without objection, it is so Mr. DICKSTEIN. Mr. Speaker, I have a number of wit­ ordered. nesses who are prepared to testify before a congressional Under previous order of the House, the. gentleman from committee and name hundreds of these spies, members of New York [Mr. DICKSTEIN] is recognized for 30 minutes. Nazi bunds who are here for no purpose other than -that UN-AMERICAN ACTIVITIES of espionage against the Government ·of the United States. I am laying the responsibility on the Congress. I hope and Mr. DICKSTEIN. Mr. Speaker, I am sorry. the hour is trust that those of you here will do something about this late, but the schedule I was hoping would work apparently matter yourselves to bring about this investigation. did not go through. I was to speak .third, and the gentle­ I am very grateful also to the American Legion,- to the man kept me for the last. I hope some day to appreciate Veterans of Foreign Wars, to the Spanish-American War Vet­ his very kind and courteous consideration. erans, and to 40 other organizations in this country repre­ I want ·at this time, however, to thank the Members of senting 50,000,000 or more people in the United States call­ the House for their cooperation in this movement against ing upon the Congress to make a thorough investigation of un-American activities in which they have been very kind these 30 Nazi camps we know now exist in this country, that both in the matter of writing letters and speaking to me spy system that is going on every day in the week. personally, and for expressing their desire to cooperate in A statement was made by one of our colleagues, I believe any way to rid our country of .an these foreign camps and the gentleman from California [Mr. ScoTT], that there was subversive groups. I hope steps toward that end will be a Nazi bund in the Panama Canal Zone. Yes, there is a taken before this Congress adjourns. Nazi bund there, and they have organized others in South In the last few weeks you have doubtless read that the and Central America. South America is flooded with propa­ Department of Justice and other Government Departments ganda sent out by Hitler. It is being done every day in the were able to pick up a number of spies in this country, all week. Wherever you find his propaganda in a country, you of whom were members of the German bund, the Nazi may be sure that is the country he seeks tQ weaken._ group in the United States, all of whom were operating in Mr. Speaker, I do not propose to take up all of my time, the United States. As I stated sometime ago, Mr. Speaker, but I do want to call attention to a more serious matter than there are more than 200 of these spies in this country seek­ that. This madman, Hitler, seeks to destroy the world. ing to undermine our Government in one way or another. I He ,iS the man who by the bayonet has forced the elections ·am sorry to say that we shall never pick them up unless we in Austria and Germany. He has done this by the gun and have some sort of investigation. -If given immunities, certain knife. There was not a real election oi 99 percent in-. favor witnesses are prepared to give testimony and name names of his government. It was a blood election. He simply of those persons operating in the United States. forced the election by blood and threats and throwing into Only a few days ago, Mr. Speaker, there appeared in the concentration camps of thousands of people both in Austria public press a statement with respect to the spies that were and Germany. I do not mind that at all. That is his busi­ found in the United States. I ask unanimous consent that ness. the Clerk of the House read this article, to be taken out of But, Mr. Speaker, do you know that the German Govern­ my time. ment and Mr. Hitler has sent over here a number of ships to The SPEAKER pro tempore (Mr. EBERHARTER) • Without every port in the United States and forced the people in this objection, the Clerk will read. country to vote for the anschluss or the Austro-German The Clerk read as follows: union in behalf of that Government? In other wotds, you SPY HUNT -TRAPS STORM TROOPS' ,.FUEHRER" HERE-BOENING, HELD AS have had a ship in every port in the last 10 days and they MATERIAL WITNESS AGAINST FOUR ALLEGED PEDDLERS OF UNITED STATES have solicited through these Nazi groups the Germans in this SECRETS, REVEALED AS BUND LEADER Wilhelm Boening, one of three native Germans arrested Wednes­ . country, through this bund and that bund, telling them they day by the Federal Bureau of Investigation in a round-up of must come on the boat and vote for the anschluss. They prisoners in an investigation of a spy ring selling American Army, have taken out of this country by force and violence over Navy and coast-defense secrets to representatives of a foreign 300,000 votes that were cast on the boats in this country. powe~. was revealed yesterday to have been "fuehrer" of the Ordnungs-Dienst, uniformed section of the German-American bund. Yet we say it cannot happen here. We have done nothing While the United States attorney's omce could not confirm the about it. rank which he held, it admitted the truth of reports that Boening Mr. Speaker, there is going to be a celebration on April 20 and John Baptiste Unkel, another of those arrested on Wednesday, throughout this country. A celebration for what? To cele­ were members of the uniformed Nazi group here. Lester C •. :Ouni­ gan, assistant United States attorney in charge of the investiga­ brate the conquest of Austria by Mr. Hitler and the birth­ tion, did not know whether the third prisoner, Karl Fredrich Wll• day of the great "fuehrer." I warn the country and I warn 1938 ·CONGRESSIONAL. 'RECORD-HOUSE 5337 the Congress that there ·will be bloodshed in those sections' channels. But there ts nothing casual or accidental about its spreading. of the country where this movement gets under way. There; That is carefully organized all the way from Berlin. will be trouble with these Nazi bunds, which, a.s I stated some Nazi government organizations in Germany, official or semi­ time ago, total over 450,000 people in this country. official, direct the drive into this country, keep a constant stream Mr. Speaker, in America we have no place for any for-. of propaganda material moving for the American market. Over $30,000,000 a year, one investigator estimated, is spent by eign ideology. This democracy cannot sit back and wait the Nazis to put over their propaganda in the United States. How until it is completely destroyed. We should not pel1llit nor close that estimate is, it is, of course, impossible to tell. tolerate any foreign camps or foreign uniforms. I hold the It is a large figure, doubtless too large. B~t it 1s apparent the Members of Congress responsible, no matter from where they Nazis' cost of propagandizing the United States runs into millions. Half a dozen organizations in Germany work at it. come, if a proper resolution is not reported. I do not care In little Erfurt, Germany, is the headquarters of World . Service. whether the Members come from New York, Chicago, or any Its function in the Nazi set-up is to spread anti-Semitic and anti­ other place. Christian, but more especially anti-Semitic, nonsense abroad. The director 1s Ulrich Fleischhauer and the associate director, Nicholas Mr. Speaker, in view of the lateness of the hour I shall Markow. not detain the House longer, but ask unanimous consent to World Service sends out confidential mimeographed releases, a revise and extend my own remarks in the RECORD and to in­ news service . to like-minded newspapers in foreign countries, clude therein the statement read b~ the Clerk. pamphlets, air on the same dreary subject. The SPEAKER pro tempore (Mr. EBERHARTER) . Is there FOR GENTILE DISTRIBUTION objection to the request of the gentleman from New York? The standing explanation printed on the World Service leaf!.ets There was no objection. is that they are intended to be passed on from hand to hand The matter referred to is as follows: amongst gentiles. They are issued in eight languages and their "principal aim is to enlighten ill-informed gentiles, irrespec- [From the New York Post of March 15, 1938) . tive of the State or country to which they may belong." They NAZI PENETRATION OF THE NATIONAL GUARD "form accordingly a necessary part of the intellectual armory of every gentile." Contributions are invited and there is a theoretical We congratulate Governor Lehman for taking steps to eliminate subscription of $2.50 a year. Actually World Service 1s sent free the Nazi taint which unwise recruiting practices and slack ad­ wherever it is accepted. ministration have permitted to creep into the New York National Typical of the milder sort of information which World Service Guard. disseminates is this item, headlined "A Vtllage Without a Church": The Governor orders that hereafter none but citizens of the "A World _Service correspondent in Paris reports;, 'At the Paris ' United States will be allowed to enlist; they must prove American exhibition a French village has been erected, but by order of the birth or naturalization on doing so. Noncitizens now on the rolls Blum government, no church was included. A protest was sent . will be denied reenlistment if their first papers have lapsed. Mem­ in by a group of Aryan French writers, saying that a typical bers of the guard who enlisted by fraudulently claiming to be French village without a church was unthinkable. And who do citizens when they were not will be expelled. you think called on the chairman of the group to persuade them It has taken a long time to get around to this--a year in which to :withdraw the protest? The Cardinal-Archbishop F. Verdier we have been treated to nasty stories of recruiting "ads" of Bat­ himseif. This cardinal is supported by Bishop Chaptal, whose tery D Two Hundred and Forty-fourth Artillery, placed in-the local mother is the Jewess Raffalovitch.' " Nazi :O:ewspaper; stories of a Fascist ball on a leased United States Thus the Jews and: the church are put in their place. Many ship, at which 30 officers and men of the guard in uniforms dis­ of the iteins of such hot information bear internal evidence of ported with anti-Semitic White Russians and Nazi propagandists; being Inade out of whole cloth. . -stories of a "Russian battery", the Headquarters and Combat Train The Deutsche Flchte-Bund, wiah headquarters in Hamburg, Battalion of the Two Hundred and Forty-fourth. is called a "union for world truth." It is a membership organi­ We don't believe for a minute that the New York National zation, but in dictator-ruled Germany no such organization can Guard has any great percentage of these foreign elements or t):lat carry on without the official sanction of the Government. Like ·the National Guard is secretly working for fascism. That is World Service, the Fichte-Bund is directed by men high in the nonsense. But it also seeins fairly obvious that many young Nazis counsels of the Nazi Party. have been enlisting as part of a planned policy of securing m111- . tary training. This week's news from Europe makes such a pene­ HOW THE FICHTE-BUND WORKS tration of the guard (which constitutes two-thirds of the official The function of the Fichte-Bund is foreign propaganda in gen­ defenses of New York) something to think about. eral and in particular instruction of Nazi members abroad. A The Dickstein committee and its investigator, Richard Rollins, letter that has come into possession of the Eagle investigators, have done a splendid job in checking through the rolls of the Na­ sent by the Fichte-Bund to the National Defenders of '76 in tional Guard of this State. Rollins reports that at least 500 of Brooklyn and bearing the typed signature of Th. Kessemeier as the 17,000 on the rolls are aliens whose continuance in the guard chief, foreign department, declared: is of questionable legality. He liSts a German whose first citizen­ "We ·noted with great interest that your members have been ship papers lapsed 23 years agO; still serving in the swanky asking for further copies with first-hand inforination, especially One Hundred and Seventh Infantry; another with lapsed papers regarding the Jewish question, and we are pleased to mail you -in the One Hundred and Second Observation Squadron of the 3 000 various leaflets on that question. They will be forwarded Twenty-seventh Division; a third in another division; and so on. i~ various batches. · OtherWise they might go astray somewhere. We note that though Governor Lehman promised to break up "A great number of universities, high schools, and many other the "Russian battery" (Headquarters and Combat Train Battalion institutions get regular supplies of our material." ·of the Two Hundred and Forty-fourth) "last December, 40 Rus­ The Defenders are given a broad hin't as to how to make the ·stans are still in it, about a third of whom are aliens. propaganda go further: Nothing in this cleansing campaign should be allowed to become "We should be very grateful, if you see your way to insert our an attack on aliens generally or should lead to any assumption publications in suitable papers or periodicals and are always ready ·of lack of patriotism among them. AmerJ.cans remember well the to send you any further leaflets as soon as they are available."­ thousands of aliens who enlisted during the war and who were Next in line is the Labor Front, organized primarily to control given special citizenship privileges therefor. They have proven all labor in Germany but with an added duty to sprel).d general their worth. But the general order by Lehman 1s needed to meet Nazi propaganda abroad, through members in foreign countries. this particular unpleasant situation which has laxly been allowed "We are sending you herewith certain matrices of photographs to arise. and should be highly pleased to have you make use of them," Mr. DICKSTEIN. The Brooklyn Daily Eagle in its issue of reads a letter from the Deutsche Arbeitsfront (German Labor Front) received last month by the editor of a small German-lan­ March 24, 1938, states: guage newspaper in this country. "We will undertake to send you Mlr.LIONS SPENT BY NAZIS ANNUALLY ON DRIVE H~OVERNMENT mats of illustrations every month • • *.'' AGENCIES FLOOD PRESS OF AMERICA WITH NEWS RELEASES--WORLD Small newspapers or other publications, operating usually on a SERVICE ISSUES MIMEOGRAPHED SHEETS OF PROPAGANDA WITH AIM narrow margin, are likely to be pretty grateful for mats, or ma­ TO ENLIGHTEN ILL-INFORMED GENTILES IN EvERY COUNTRY-PERIL trices, sent free. Such prepared boilerplate saves costs as well as TO FREEDOM the trouble of editing. All editing has been done in advance in this (Fourth in a series of articles to appear daily and Sunday in the case by Labor Front editors in Germany, who. have prepared the Eagle, revealing the extent of the menace from foreign and domes­ proper material with the proper Nazi viewpoint. tic propaganda aimed to upset religious and civil Uberty in the There are also: · The League for Germanism Abroad, which sends out cultural United St ates. Material for the series has been obtained from material, such as a map of the world showing provinces of Government and other sources, in many cases substantiated by Germany wherever there are colonies of Germans, including the documentary and photographic evidence.) United States; (By John W. Smith and W1lliam Weer) The foreign division of the Nazi Party, including only German Nazi propaganda, including the race hatred of anti-Semitism, 18 citizens and Government otficlals serving in foreign countries; and Spattered over the 48 States by devious ways through a variety of JUlius Streicher, No. 1 Jew baiter of the world, who sends copies · 5338 CONGRESSIONAL RECORD-HOUSE APRIL 12

of his Der Stuermer, devoted to 1ncredib~y vituperative anti­ The SPEAKER pro tempore. 7s there objection to the Semitic blather, through the United States mails. These are the Nazi organizations, operating from German soU. request of the gentleman from Oklahoma?- . which have a part in the merry game of educating the world-and There was no objection . the United States--in the Nazi doctrine. Mr. JOHNSON of Oklahoma. Mr. Speaker, during the GERMAN SEAMEN ARE AGENTS closing weeks of the first session of this Congress, after Mem­ All Germans who work in foreign countries or on German ships bers of both Houses had been discussing the deplorable farm­ sailing to foreign ports must belong to the Labor Front, and they are available to help in the good work. tenant situation for many years, it will be recalled that a From these official and semiofficial organizations--and under a so-called farm-tenant bill was finally enacted, the same being totalitarian state there can be no real d11ference between the H. R. 7562. When that measure was before this House for status of the two groups--the Nazi dicta are carried into the United States. Here they are spread by a network of other or­ consideration, I expressed my deep disappointment in that ganizatioils, which in many cases pose as very patriotic, very measure, which has been referred to as the Jones-Bank.head American. Farm Tenant Act. Whether their members know it or not, this 100-percent Aineri­ can patriotism with a Fascist slant is a foreign, imported product, Members will recall that under the terms of that bill the made in Nazi Germany. amount of only $10,000,000 was made available for the first While the common, run-of-the-mill followers of these move­ year, $25,000,000 was authorized for the second year, and ments may be duped, the leaders know what it is about and where $50,000,000 each fiscal year thereafter. As one Member of their stuff comes from. Thus Robert Edward Edmondson, big-time anti-Semitic pam­ Congress who had persistently advocated real farm-tenant phleteer, talks in large terms of patriotism and Americanism while legislation on the :floor and before the committees of Congress . he cries of the Jewish peril. His subscribers may nod their heads for several years, I did not hesitate to say that the bill was sagely in agreement with his patriotic-American talk, but a letter . reproduced in an adjoining column reveals that he stands high in a mere gesture, and almost an empty gestme at that, toward the esteem of those who operate World Service. solving the very perplexing and desperate situation with ref­ Apparently Mr. Edmondson failed to attend a world service con­ erence to farm tenancy in America. Those of us who have ference at which he had been expected and received a letter of greeting from the assembled delegates signed not only by Herr been carrying on a relentless fight for real, comprehensive, Fleischauer but by like-minded representatives from a score of and adequate farm-tenant legislation had the choice of either other countries. voting for the Jones-Bankhead bill or no legislation at all. PELLEY OF ASHEVILLE The law as passed last July authorizing $25,000,000 the Or there is William Dudley Pelley, of Asheville, N. C., commander second year and $50,000,000 annually thereafter, although of the Legion of Silvershirts, editor of the weekly Lib~ration and propounder of a Fascist-type Christian commonwealth, very Amer­ entirely inadequate, did offer a small ray of hope to the mil­ ican. Pelley is so American that he now and again takes time out lions of deserving farm tenants and their families. During to make a furious defense of the only Americans who never were that discussion it was stated by the leaders of this House that anything else, the Indians. the sum authorized annually would undoubtedly be appro­ And yet the latest issue of Liberation to reach this city, dated March 14, is devoted to Adolf Hitler. A heroic, idealized drawing priated. That was a solemn agreement made by Congress of the Nazi fuehrer adorns the front cover, captioned "Deliverer of with the farm tenants of the country. That authorization Russia!" with the quotation underneath from Pelley himself: either meant what was stated in the law or else it was a "The day that Adolf Hitler rides in triumph into Moscow, ns he rode on March 12 triumphant into Vienna, he shall stand at the meaningless promise on the part of those sponsoring the so­ peak of his career. There shall be no greater heights for him to called farm-tenant bill. climb in this his present life. It will be recalled that during the fight for the enactment Between the covers the main piece, entitled "Hitler • • All the Way to Moscow," is a blatant piece of hero worshipping, of that law some of the leading members of the Appropria­ the hero being the fuehrer of all the Nazis; and in the place of tions Committee were active in their opposition to even the second importance is a piece entitled "The Real Facts on Condi­ small "sop" proposed under the terms of the Jones-Bankhead tions That Made Austria Go Nazi," by Elmer F. Elmhurst, author Act. It is sw·prising, however, that an effort is apparently of The World Hoax. The author finds that Austria went Nazi because the Austrians wouldn't stand for the Jewish Schuschnigg being made by the committee now to cripple or, in fact, prac­ government, controlled by Jewish bankers, and- tically destroy and make inoperative the terms of that law. "The second strong factor in exercising an undue influence over Frankly, I am amazed and chagrined to learn that the the Austrian people has been the Catholic Church. Cardinal In­ nitzer's close .brotherly alliance with the Jewish money power subcommittee having jurisdiction over the pending measure • • •." The Fatherland Front (Austrian nationalist storm has not seen fit to comply With the provisions of the law troop organization which backed the Schuschnigg dictatorship and allow the full amount of $25,000,000 for the next fiscal until the Nazi German power drove it out) was also "sanctioned year. The only defense or excuse I hear of the action of by its Jewish and Catholic sponsors." Jew, Catholic Church, and Austrian dicta1ior-Pelley does not the committee is the claim that not all of the first $10,000,- like them if Herr Hitler doesn't. 000 appropriated has actually been expended. But that, Mr. It seems a queer coincidence. Speaker, is no excuse. The fact is that it has taken several Fascist propaganda has invaded our hemisphere, and a months to get the machinery of the farm-tenant organiza­ number of South American countries are being subjected to tion set up, and only a few weeks ago the first tenant in the activity which, if unchecked, can only" result in disaster. United States received his loan. I am advised that all, or I have before me this dispatch to the New York Times, practically all, of the money appropriated for the first year which shows the situation in Brazil: will have been spent before the end of the fiscal year. With the machinery now in operation, and with millions of de­ BRAZIL BANs NAZI U~AssociATIONS, BELIEVED DmECTED IN BERLIN, .ARE DISBANDED serving tenants and their families pleading and praying for Rio DE JANEmO, Aprll 15.-An official investigation in the State an opportunity to become home owners, with a constant drift of Rio Grande do Sui has disclosed that out of 2,845 German of the farm population toward the towns and cities, I sub- · private schools in that State only 20 taught Portuguese, the official mit, Mr. Speaker, that the least this Congress can do is to Brazilian language. Because Nazi propaganda recently has been more evident in Rio Grande do Sui, the Government has banned appropriate the full amount authorized under the farm­ all German societies or associations which are believed to be tenant law. [Applause.] directed from Berlin. When we take into consideration the fact that more than The investigations disclosed that children of Braz111an-born Ger­ man parents were taught to obey Chancelor Adolf Hitler rather 55 percent of all the farm acreage in the United States is than Brazil1an law. tilled by tenants, and that the percentage is growing higher year by year, the amount authorized is, of course, a mere Instances could be multiplied. All is part of a general drop in the bucket as compared with the urgent and crying scheme to reorganize the world on totalitarian lines. If we needs of the country. Members from the agricultural dis­ do not prevent the spread of this disease, we have only our­ tricts have generally gone along on what is called the hous­ selves to blame for the resqlt. ing program and slum-clearance program for the great cities WOULD AID FARM TENANTS of the country. There has been no demand for cutting down Mr. JOHNSON of Oklahoma. Mr. Spea~er, I ask unani­ of expenditures so far as that program is concerned. On mous consent to address the House for 10 minutes. the other hand, there seems to be a well-founded rumor '1938 CONGRESSIONAL R-ECORD-HOUSE 5339 to the effect that Congress will soon be called upon for many : The motion was agreed to; accordingly (af 5 ~ o'ClOck p.m.) additional hundreds of millions of dollars to be expended the House adjourned· until tomorrow, Wednesday, April 13, to a very large extent in the cities throughout the length and 1938, at 12 o'clock noon. · breadth of the land. Yet the farmers of America, who are actually feeding the Nation, are told by this committee that COMMI'ITEE HEARINGS this Congress is unable to appropriate the comparatively COMMITTEE ON NAVAL AFFAIRS small sum is solemnly promised of $25,000,000 to assist the millions of tenant farmers in the entire United States, all of There will be a full open committee meeting of the Com­ whom are entitled to live under their own roofs and sit by mittee on Naval Affairs Wednesday, April 13, 1938, at 10 a. m. their own firesides. [Applause.] for the consideration of certain private bills. What I am complaining specifically about, Mr. Speaker, is COMMITTEE ON INTERSTATE AND FOREIGN COMMERCE the fact that this committee proposes to appropriate only There will be a meeting of the Committee on Interstate $15,000,000 next year to carry out the provisions of the and Foreign Commerce at 10 a. m. Wednesday, April 13, Janes-Bankhead Act. This is a reduction of $10,000,000 be­ 1938. Business to be considered: Continuation of hearing on low the amount authorized by law. If this House follows the H. R. 9047, control of venereal diseases, and other kindred action of the committee, it will, in my judgment, break faith biDs. with the millions of deserving farm tenants of the Nation. COMMITTEE ON FLOOD CONTROL This Congress ought not, yea, it must not, break faith set forth below are dates, times of meetings, subjects of with those deserving citizens who are unable to speak for hearings, and parties to be heard with respect to a number themselves. [Applause.] of hearings scheduled before the Flood Control Committee: Mr. GREEN. Will the gentleman yield? The Committee on Flood Control will continue hearings Mr. JOHNSON of Oklahoma.. I yield to the gentleman on Wednesday, April 13, 1938, at 10 a. m. Local representa­ from Florida. · tives of the White River and tributaries will be heard. · Mr. GREEN. The gentleman states that $10,000,000 was · The Committee on Flood Control will continue hearings the first appropriation? on Thursday, April 14, 1938, at 10 a. m. Local representa­ Mr. JOHNSON of Oklahoma. Yes. tives of the Missouri River and tributaries will be heard. Mr. GREEN. Then the plan was to give how much per The Committee on Flood Control will continue hearings year? on Friday, April 15, 1938, at 10 a. m . . Local representatives Mr. JOHNSON of Oklahoma. For the second year $25,- of the lower Mississippi River and other tributaries will be 000,000 and $50,000,000 for the third year and each year beard. thereafter. · The Committee on Flood 'Control will continue hearings Mr. GREEN. And the amount for this coming year has on Saturday, April 16, 1938, at 10 a. m. Local representa­ been reduced to $15,000,000? tives of the lower Mississippi River and other tributaries Mr. JOHNSON of Oklahoma. It has been reduced to will be heard. $15,000,000, and that is what I am complaining about. · The Committee on Flood Control will . continue hearings Mr. GREEN. The gentleman would favor an increase of on Monday, April 18, 1938, at 10 a. m. Senators and Mem­ that up to the amount first contemplated? bers of Congress will be heard. Mr. JOHNSON of Oklahoma. Yes; to the amount author­ COMMITTEE ON MERCHANT MARINE AND FISHERIES ized-$25,000,000. If I had my way about it, of course, it The Committee on Merchant Marine and Fisheries will would be considerably more than that. hold hearings at 10 a. m. in room 219, House Office Build- Mr. GREEN. I think the gentleman is correct, because ing, on the following bills on the dates indicated: · in my State we have received our small proportion of the Thursday, April 14, 1938: first appropriation. We have demands, and demands that H. R. 8533. To amend section 4370 of the Revised Statutes are valid, which would increase this a hundredfold, and I of the United States (U. S. C., 1934 ed., title 46, sec. 316). think the gentleman is perfectly right in his opinion. Tuesday, April 19, 1938: . Mr. JOHNSON of Oklahoma. I thank the gentleman for H. R. 5629. To exempt motorboats less than 21 feet in his contribution, and I may say to him that the farm-tenant length not carrying passengers for hire from the act of June Situation in Oklahoma is probably more distressing than in 9, 1910, regulating the equipment of motorboats. his State of Florida. In my speech here last year I pointed H. R. 7089. To require examinations for issuance of motor­ out that proportion of farm· tenants in Oklahoma increased boat operator's license. from less than 1 percent in 1890 to over 60 percent in 1935, H. R. 8839. To amend laws for preventing collisions of ves­ and now estimated to be over 65 percent. In some of tl::le sels, to regulate equipment of motorboats on the navigable southern counties of Oklahoma, in the district I represent in waters of .the United States, to regulate inspection and man­ Congress, more than 70 percent of the farmers are tenants, ning of certain motorboats which are not used exclusively through no fault of their own. They are looking to this for pleasure and those which are not engaged exclusively in Congress to keep faith with them. I give notice now that the fisheries on inland waters of the United States, and for when this bill reaches the amendment state that I shall offer other purposes. an amendment to increase the amount from $15,000,000, as provided in the pending bill, to $25,000,000, as authorized by law. [Applause.] · EXECUTIVE COMMUNICATIONS, ETC. EXTENSION OF REMARKS Under clause 2 of rule XXIV, executive communications Mr. GREEN a.sked and was given permission to revise and were taken from the Speaker's table and referred as follows: - 1233. A coriununication from the President of the -United extend his own remarks in the RECORD. States, transmitting supplemental estimates of appropria­ LEAVE OF ABSENCE tions for the. Department of the Interior for the fiscal years By unanimous consent, leave of absence was granted as 1938 and 1939 amounting to $3,659,334.57