1951 to 190.2 in January 1952. During the same period there has been no price increase whatever authorized by OPS, except in the cases where an application for adjustment based upon a hardship had been filed (which as above stated, is rather rare indeed). Nor do the increases indicated in subparagraph (a) show a substantial increase from the spring of 1950 to the spring of 1951.

For

Moreover, the price of bowling cannot materially affect the cost of living. one thing, bowling is not a necessity; secondly, bowling, by its very nature, cannot substantially influence the standard of living. Bowling patrons consist of two types the occasional bowler, and the "league" bowler. The latter belongs to a league or group and bowls with his or her team on a regular weekly schedule of three games per week, averaging approximately 32 or 33 weeks for the entire year. The average charge for bowling in this country varies between 30 and 35 cents per game (a small percentage charge a few cents less or a few cents more). If this amusement were exempt from controls and if each proprietor increased his price 5 cents per game (which is hardly likely, since the price of bowling never did increase by leaps and bounds, nor can it be imagined that any proprietor would be able to receive an increase in excess of 5 cents per game) such increased cost to a league bowler, that is to say, for a bowler who bowls regularly under a fixed schedule for the entire season, amounts to 15 cents per week or $4.95 for the entire year. For the occasional bowler, it would naturally be that much less, per year. To a bowler who plays the game twice as often as a league bowler, an increase would be $9.90 for the entire year. These are maximum increases that can be anticipated. In many cases there would be a lesser increase and in some cases there would be none at all. It is estimated that league bowling represents about two-thirds of the total bowling throughout the country. Thus it becomes, obvious that the possible increase in the price of bowling, if any, is so infinitesimal compared to the total average cost of living, as to be wholly inconsequential. In fact, and in support of this view, the Office of Price Stabilization, in its recent decontrol for bowling pins (the most expensive item of continuous replacement due to wear and tear), asserted, as the grounds therefor, that:

"The commodities exempted by the amendment are of minor significance to the economy and have but a trifling effect on the cost of living, the cost of the defense effort and general current industrial costs. These commodities are not so related to any commodities which are important to the cost of living, the cost of the defense effort or to general current industrial costs, as to have any effect on the controls of commodities remaining under ceiling price regulations." (General Overriding Regulation 5, amendment 4, January 30, 1952.)

The foregoing appears to be the criteria adopted by the OPS in determining whether a commodity or service so affects the cost of living as to require controls or not.

Bowling is less a factor in the cost of living to the average wage earner than are motion pictures, or theaters, judging by the extreme differences in the comparative expenditure for the respective items on a national scale. Bowling and inflation cannot be mentioned in the same breath. The principal aim of the act, namely, the prevention of inflationary tendencies, has no application to this game. If that be so, bowling, by its very nature, excludes itself from that very purpose of the act. By extension of a logical conclusion it should be specifically exempted from controls in the act.

(d) The elimination of profiteering, hoarding, and speculation? This purpose was apparently intended for speculation in scarce commodities. It obviously has no application to a game which cannot become the subject of hoarding, sale and resale at profits or speculation.

(e) The protection of consumers from undue impairment of living standards? For one thing, bowling is neither a necessity nor the subject of an "urge" so great as to be comparable to a necessity, as, for example, smoking. Should it become necessary for a patron to bowl less frequently (an assumption for the purpose of this discussion, but by no means an admission) his living standards will not be "unduly impaired. It is estimated that there are less than 4,000,000 bowlers in this country. This is concluded from the fact that the aggregate of bowlers "sanctioned" by and registered with the men's, women's, and minors' bowling associations in the United States is slightly over 2,205,000 bowlers. These are the "league" bowlers. League bowling constitutes two-thirds of the total bowling. Hence an additional third would be 735,000 more bowlers, or a grand total of 2,940,000, or almost 3,000,000 bowlers. To this we add, for good measure and for possible oversights, another million. That means there are about 146,000,000 nonbowlers among our population, constituting over 97 percent of the public whose living standards are in nowise affected by this subject.

Of greater significance in this respect is the fact that the post-Korean inflation which threatened to impair living standards and which caused the enactment of the Defense Production Act, and the controls which it authorized, did not materially affect the volume of bowling business (for which figures are cited in paragraph (g) following). So that, if bowling should be considered an essential integer of living standards, such element of the standard of living appears to be immune from any impairment of its standard by outside inflationary pressures. The only logical explanation for this phenomenon is that the cost of bowling, in relation either to the national economy or to the individual bowler, is trifling, insignificant, and meaningless.

(f) The prevention of economic disturbances and labor disputes? This purpose deals with a different subject not related to bowling, but rather to wage stabilization and bears no relation to the subject under discussion.

(g) The maintenance of a reasonable balance between purchasing power and the supply of consumer goods and services? Again, bowling by its very nature cannot become the subject of such a program. Bowling is not that kind of a commodity or service, the sale of which varies with a fluctuating market, or changes in price range. The service, if indeed it be a service, cannot be stored or withheld for a rising market, nor can it be dumped upon a falling market, as might be the case with other commodities or services. This is due principally to the nature of the game and its physical restrictions.

For one thing, if prices were to soar or to fall, as the case may be, bowling cannot be sold at a rate faster or slower than about 61⁄2 games per hour. That is the average speed of the game, regardless of how many patrons bowl at the same time. Furthermore, as can be expected, most bowlers desire to bowl between 7 p. m. and 11 p. m., the usual hours available to the average person for amusement and recreation. Comparatively very few people are available who wish to bowl at other hours. In consequence, no matter how many patrons crowd the establishment during the more popular hours, no more than 61⁄2 games per hour, per alley bed, can be sold. The other patrons must wait their turn, er be nonpaying spectators. On the other hand, during the cff hours, one cannot induce a patron who must be at his work or at home sleeping, to bowl at any price. In this respect bowling income differs radically from motion picture or theater income, where a good picture or show will attract crowds, resulting in greater revenue, whether the patron is seated comfortably or views the show from the "standing room only" section in the rear. Crowds in bowling alleys are deceptive, since they are not a source of bowling revenue unless they actually bowl. It follows that bowling is not a commodity, the supply of which must be balanced with purchasing power. The supply is more closely controlled by the leisure hours of its patrons rather than by purchasing power.

As an additional indication of this concept, it is respectfully pointed out that, notwithstanding the inflationary pressures which precipitated controls, and which, one would think, should have adversely affected the volume of bowling business, that the survey mentioned earlier, from March to May of 1950 compared to March to May of 1951 (commencing with the period prior to Korea and ending after the imposition of controls), shows a decline of only 9.34 percent. If the inroads made on this volume of business by television were deducted (if it could be accurately identified) it would show a still lesser decline in volume. This is a clear-cut indication that purchasing power is unrelated to the supply of this commodity. Most likely this negative relationship is due to the most outstanding fact that the amount spent for bowling is of no great consequence to the average wage earner; that it is, indeed, insignificant. Congress ought not to concern itself with such insignificant trifles.

(h) The protection of the national economy against future loss of purchase power through dissipation of savings? Conceivably, a person may dip into savings to make both ends meet, if purchase power is impaired. This possibility would apply to necessities or to the more substantial luxuries, for example, furs, cars, diamonds, boats, etc. To be concerned that a person would deplete his present bank account to a point where future purchase power would be impaired to go bowling or to pay an increased price for bowling is in the realm of fantasy. Especially so since possible increases, if any, for an entire year's bowling must be of necessity so trivial an amount.

(2) Finally, the prevention of a future collapse of values? Bowling, of itself, is no standard of comparison of value. Nor can so small an element of the national economy be that kind of a yardstick as to affect the whole. It is neither possible nor conceivable that bowling, whose record of price stability is exemplary to the rest of the Nation's activities, should become subject to price rises giving way or

contributing to a collapse of values. On the contrary, even with price-control legislation the cost of living went up (as indicated in subparagraph c), while the cost of bowling did not. In short, bowling prices enjoy a stability uncommon to general trade. One of the reasons for this is that league bowling is sold upon a fixed price, by written or oral contract for the entire bowling season, which is invariable. In fact these contracts are usually arranged many months in advance of the season, so that the stability of the price is usually for a period of at least a full year. Open bowling, by the same token, cannot vary appreciably in price since, after all, bowling is bowling, be it open play or league play. The game, by its peculiarities, does not readily lend itself to erratic price fluctuations. If anything, it induces stability rather than variance and is an excellent influence upon the national economy to the limited extent that so small an activity can possibly influence our national expenditures.

7. From all of the foregoing, it becomes evident that when Congress enacted the Defense Production Act of 1950, and its amendments, for the reasons which then existed, the prices charged for bowling were not the motivating causes for this legislation; that the factors which prompted the Congress to impose controls did not then, and do not now, apply to bowling; that bowling is subjected to controls by impelling conditions pertaining to the sale of commodities and services other than bowling; and finaly that none of the purposes of the act are accomplished by regulating bowling.

8. The imposition of controls over this game has subjected the bowling alley operator to filing of ceiling price schedules and other additional record keeping and compliance provisions which have burdened the bowling operator with an onerous and difficult problem. Many bowling alleys maintain a snack bar for food and beverage refreshments. The ceiling prices on the food and beverages. are governed by an OPS regulation (CPR 11) under which ceilings are imposed on the basis of percentage of "food cost" and not unit prices, as in bowling. The result is that in so small a business the operator has two incompatible standards of prices; that is, for food and beverages he has a variable price depending upon the cost of the food and beverages to him, without regard to increased costs of rent, heat, light and power, insurance, labor, and other overhead items, while in bowling there is a fixed price dependent upon a basc-period price, which, presumably, did take into account these overhead items. Yet the overhead for both phases of the business is one and the same. At this late date, the Office of Price Stabilization has still been unable to establish any formula or rule of procedure to allocate these overhead costs in determining applications for ceiling price adjustments, probably due to the difficulty, if not the actual impossibility, of promulgating a practical approach to the problem.

9. In addition, enforcement of a regulation fixing the amount a patron should pay to go bowling, which varies from one establishment to another by only a few pennies, imposes a burden and expense upon the Government which is wholly incommensurate with the benefits such regulation could possibly attain. In fact when the Office of Price Stabilization decontrolled bowling pins (General Overriding Regulation 5, amendment 4, January 30, 1952), it stated the following as among its reasons for decontrol:

"Furthermore, any ceiling price restrictions imposed on these commodities would involve an administrative and enforcement burden out of all proportion to the importance of keeping them under price control. Considering the types of commodities exempted, this amendment will not have any material effect on the general level of prices.'

It seems incongruous for OPS to exempt bowling pins, the most expensive replacement item in a bowling alley and not to decontrol bowling.

In addition, it is pointed out that bowling proprietors are small-business men. Bowling is not a gigantic enterprise. The cases where more than one establishment are owned by the same proprietor are few and far between. The complicated duties of compliance place a very heavy onus upon these small-business men who are not equipped to comply with these onerous duties as compared to big business, when there is so little purpose that may be accomplished by this burden. 10. Sufficiently important and not to be overlooked is the disturbing fact that it may well be that Congress did not intend to regulate the price of bowling in the first instance, and that the Office of Price Stabilization has extended its jurisdiction over this activity beyond the scope of the Defense Production Act of 1950, as amended, and beyond the authority vested in it by the Congress. A serious question presents itself: "Is bowling a service?" Or does not the bowling alley operator merely make available to a bowler his facilities, upon which the bowler renders to himself his own "service"? Does not the bowling proprietor merely

sell a privilege? Did not Congress intend, by the use of the word "service," something that is performed by a person such as cleaning a suit, or painting a house or fixing a car, etc.?

11. In point of fact, this question has completely confounded the Office of Price Stabilization to a point where one division of the Office of Price Stabilization, by its definition of the word "services," has and still does violently contradict another division and the extent of the jurisdiction of the Office of Price Stabilization depends upon the mere accident of which division one deals with. For example: (a) The original general ceiling price regulation, issued January 26, 1951, which governed both sales and materials, as well as services, defined "services" (sec. 22) as follows:

"This term includes any service rendered or supplied otherwise than as an employee, and contracts to sell or supply such services."

This is a simple definition along logical and obvious lines, wholly within the intent of the congressional statute. Later, Ceiling Price Regulation 34, issued May 11, 1951, divorced many services from general ceiling price regulation but excepted certain services which are still governed by the original regulation. A new definition of "service" was added (CPR 34, sec. 27 (a) (17)), which reads as follows:

"'Service' or 'services' means any act or acts performed or rendered, otherwise than as an employee, for a fee, charge, or other consideration. The term includes any privilege sold or granted, or any forbearance to act, for a fee, charge, or other compensation. The term also includes the rental of any commodity or services if the rental charged is not covered by another ceiling price regulation and has not been exempted from price control.'

It should be noted that the Office of Price Stabilization has added to its definition the sale of a privilege or a rental of a service. Thereafter on June 7, 1951, the original general ceiling price regulation was officially reissued, embracing all amendments thereto up to that date. There, the definition of a service was given as follows:

"This term includes any service rendered or supplied, other than as an employee."

Thus we have three separate definitions of the meaning of the word "services," one of which was issued on January 26, 1951 (GCPR), which gives a fair definition of the term; another issued on May 11, 1951, under CPR 34, which has added thereto the sale of a privilege and the rental of a service, which was not contained in the earlier definition; and finally, a third definition issued on June 7, 1951 (GCPR), which again reverts to the original definition and does not include the sale of a privilege or rental of a service.

Whether an activity is subject to controls depends, apparently, on potluck. If the so-called service comes under CPR 34, the definition includes the sale of a "privilege," but if the service comes under GCPR, the definition does not include the sale of a "privilege."

12. Does the Office of Price Stabilization have a right to include the sale of a privilege, or is there such a thing as the rental of a service, or can a "service" be rented out?

The answer to these questions is to be found in the act itself. Congress did not expressly define the word "service." It follows that its meaning must be deduced from the manner in which it is used in the statute. For example, section 402 (c) of the statute, in describing the manner in which regulations shall be promulgated, used the word "services" in such a way as fully to describe its intended meaning, leaving no room for doubt as to the maximum activities to be embraced by this word. In that section appears the clause: "* * and general increases or

*

decreases on the profits earned by sellers of the material or by persons performing the service * * *"[italics ours]. A "service" as contemplated by Congress is that which is performed by a person. It is not something that can be rented. Rentals apply to real property and in certain instances to chattels, but not to an intangible activity.

When Congress used the phrase "performing a service," it indicated what type of service it contemplated. "Performance" cannot be the subject of a rental. The definition of the word "service" in CPR 34 not only goes beyond the intent of Congress, but has created a standard which is nonexistent and which is unauthorized. The lack of congressional authority is indicated by the utter confusion on the part of OPS in its attempt to enlarge and extend its definition of services at one time, and to restrict it within logical bounds at another time. Nevertheless, bowling proprietors, having been specifically named in an OPS press release of May 11, 1951 (although not in any regulation), find it necessary to appeal to the

legislature for specific exemption. The mere fact that bowling had not been specifically excepted in the original statute does not of itself infer that it was intended to be excluded. For example, a theater or motion-picture house clearly performs a service in preparing and presenting its show or picture. Hence, if they are to be excluded, the statute must state that fact, which it does. But an activity which is the sale of a privilege, as the OPS puts it, is not the sale of a service, and, ordinarily, would not require a specific statement that it is excluded. It is because of the Office of Price Stabilization's extension of its authority by its own definition that makes it necessary for Congress to state whether bowling, which is not a service, is not to be included under controlled activities.

13. In summary, it is respectfully urged upon this committee that with respect to bowling there is no need for price regulation for the reasons that:

and

(a) The price or expenditures for bowling do not affect the national economy; (b) That bowling does not qualify under any of the aims and purposes of the Defense Production Act of 1950, as amended; and

(c) That no substantial benefits derive from controls to warrant subjecting this activity to regulation; and

(d) That the burden upon the operator and the Government far outweighs any advantages to be attained by controls; and

(e) That bowling is not a service and was not intended to be subject to controls. 14. It is respectfully requested that the 1952 amendments to the Defense Production Act specifically exclude bowling along with motion pictures, theaters, barbers, and beauticians.

Respectfully submitted.

NEW YORK, N. Y., March 3, 1952.

JOSEPH G. GUBMAN, Esq.

STATEMENT OF SYDNEY M. CONE, JR., PRESIDENT OF NATIONAL ASSOCIATION OF FINISHERS OF TEXTILE FABRICS ON PROPOSED EXTENSION AND AMENDMENT OF THE DEFENSE PRODUCTION ACT OF 1950

The executive committee of the National Association of Finishers of Textile Fabrics is of the opinion that no justification exists today for the continuation of price controls on the finishing of textile fabrics. Our association is convinced that the Defense Production Act of 1950, as amended, should contain provisions for the suspension of price controls on textile finishing, or complete abolition of such price controls. This step can have no adverse effect on the national economy or the purposes of the Defense Production Act. The same

Current textile prices are substantially below the OPS ceilings. condition applies to the finishing charges of the commission finisher, who processes approximately 70 percent of the finished cotton fabrics produced each year. Costing and pricing of textile finishes is a complex operation. There are thousands of colors and print designs, as well as 578 special finishes in use at the present time. Confusion and uncertainty result from endless red tape of any price regulation, and, if continued, our industry will be further hampered in its efforts to emerge from the present depressed condition of the textile market.

In the year immediately following the start of the Korean war, production in finished cotton fabrics amounted to approximately 7.7 billion yards. This rate of production exceeds the peak reached in the war years and reflects the new finishing capacity built in the postwar period. In the 8-month period since July 1951 the production rate has dropped 15 percent as a result of the depressed textile market. Inventories of grey and finished fabrics at the finishing level are estimated to be 25 percent above the pre-Korean level. It is obvious that the productive capacity of the finishing industry is more than sufficient to meet any foreseeable demands by our national economy.

We are confident that the Congress does not favor controls on our economy when it is clear that the need has passed. It is our considered judgment that a careful examination of the situation will sustain our recommendation to decontrol prices of textile finishing.