postcard I saw, for the first time, an advertisement for industry to locate in a certain locality, because the wages were lower than anywhere else. I did not think I would ever live to see that in America. And it gives the wages: Girls, 60 cents a day; women, $1 a day; and men, $1.25 a day. That industry was the hosiery industry.

I was so surprised after getting that card, that I went to a Senator from the State where the card came from, and I said to him: "I do not want to ask you publicly, but I would like to privately: Do you think this condition exists that is described on this card?" And to his credit, he said he did not know; that it was possible, but he did not know, but he could not conceive of there being any industry where those were the wages.

However, I just did not think it proper to raise sectional questions and I have done or said nothing more about it, but here is the opportunity for us to begin to say that, in the making of these contracts, at least we have 8 hours a day for those who work upon Government contracts.

There is a letter that I have, and a table which accompanies it, that are not in the record, showing that, following the decision of the N. R. A., and between that time and the 1st of July, within 5 weeks, there was a 25 percent cut in wages, and a 25 percent, approximately, increase in the time of employment, the length of the working day; and strange to say, there was none after that. From July 1 to January 1, there was practically none; it all seemed to come rapidly after that time.

One officer of the Government told me that after the N. R. A. was repealed and the Government gave a contract for overalls, the man that got the contract required his help to return the extra money they got under the N. R. A. An Army officer told me that, personally. That was his experience.

The decrease in wages and the increase in hours of employment were in what industry? The textile industry, North and South? No. Boot and shoe? No. Garments, underwear, hosiery, clothes, the sweatshop industry, is where the reduction came, and in that period of time, Government contracts went to this very group.

Gentlemen, you must be tired, and I thank you for this opportunity of appearing before you, and to again compliment you for having listened and studied the solution of this problem, and I hope we will be able to work out something that will not be injurious to industry, but will be a protection to the men and women who work, and will be evidence that the Federal Government wants to be the best kind of employer, and buy its goods in American industry and in American shops-we are obliged to buy American goods-where the best working conditions exist.

Mr. SUMNERS. Senator, may I make a very brief suggestion for your consideration?

Senator WALSH. Yes.

Mr. SUMNERS. One of the great difficulties in some sections of the country is that agriculture, which is the basic business, has for a number of years paid such small return that there is a tremendous pressure from that business into every other business. As a result there develops in these agricultural States problems which the gen

tlemen who live in industrial sections do not have to consider. What are we going to do about that?

Senator WALSH. There is no doubt about that, and I think that is particularly true in the South. I have not the facts to bear me out, but I have the impression that the struggle to earn a reasonable competence to live on is not so great in the farming industry in the West as in the South. Do you agree with me?

Mr. SUMNERS. That may be true. It is a problem to be considered in connection with this problem.

Senator WALSH. Yes. Now, in studying that problem, do not forget it is a real grievance among those who work that wages are being lowered.

When I go home to my own town, as I do at Christmas and other times, and see those poor workers I am of course terribly depressed. It is the same way with our mills being closed, and we have taken in recently two or three of these new concerns that have moved out of New York, and I have in mind a doll factory where they employ 500 or 600 people for 2 seasons a year for a week or two. How they live I do not know. So that we have a problem, too.

Mr. SUMNERS. Yes; I know.

Senator WALSH. And these people have to pay rent, these people have to pay for coal, large coal bills, and they have not any homes that they can call their own. But as you see, it is a joint problem that we have got to solve.

Mr. SUMNERS. I want to add to what I just said, Senator, this statement: I think all students of the question will recognize that, even in those sections, a reasonable living wage for that type of people helps to elevate the whole situation.

Senator WALSH. Yes; there is no doubt about that, and of course a reasonable return to the farmer helps entire industry tremendously, and helps the workers, and it is very important to keep that in mind. Mr. SUMNERS. You cannot deal with these questions from purely sectional or vocational standpoints and

Senator WALSH. And we cannot settle them overnight, either. That is the sad part of it.

Thank you, gentlemen.

Mr. HEALEY. Thank you, Senator.

The committee will now adjourn until 10:30 tomorrow morning. (Thereupon a recess was taken in the hearing until 10:30 a. m.. : Saturday, Mar. 21, 1936.)

CONDITIONS OF GOVERNMENT CONTRACTS

SATURDAY, MARCH 21, 1936

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE OF THE COMMITTEE ON THE JUDICIARY,

Washington, D. C.

The subcommittee met at 10:30 a. m., Hon. Arthur D. Healey (chairman) presiding.

The committee will be in order. I offer for the record a brief of the Construction League of the United States on the Healey bill. (The brief referred to is as follows:)

BRIEF ON THE HEALEY BILL (H. R. 11554)

To the House Judiciary Committee:

MARCH 18, 1936.

The Construction League of the United States represents 17 national associations in the construction industry whose combined membership consists of 100,000 firms and individuals. These members are engaged in practically every branch of the construction industry, including architects, engineers, general contractors, subcontractors, materials producers, and fabricators.

It is our purpose in appearing before you to call your attention to those provisions of the Healey bill (H. R. 11554) which, in our opinion, will seriously handicap the construction industry.

We sympathize with the general idea of determining maximum hours and minimum wages, but we are convinced that in the construction industry this can be accomplished only through a carefully developed program recognizing the principle of local determination and that the bill in question would in many of its applications be as unworkable and impracticable as were the construction industry N. R. A. codes.

The method proposed to arbitrarily determine hours and wages within the construction industry ignores the entire experience on this subject obtained through the operations of the construction industry under N. R. A. codes. The difficulty, if not the impossibility, of equitably and properly determining the maximum hours and minimum wages in various localities and branches of the construction industry was completely demonstrated by the experience of the construction industry under the N. R. A. codes.

In the construction industry it is particularly important that not only the fundamental principles which may be established in the law, but that rules, regulations, and interpretations which are necessarily vital to its interpretation be clearly expressed and generally known. In the N. R. A. experience it was clearly demonstrated that the rules, regulations, and interpretations frequently were much more important in their effect on the construction industry than were the basic laws, and since the industry must be able to predetermine its cost before submitting bids, this uncertainty led to great confusion, conflict of interests, and inequities, which were among the major causes for the general disintegration of the effort.

We recommend that your committee make a thorough study of the construction industry's N. R. A. experience and be guided thereby in the formulation of any bill which seeks to control wages and hours within the construction industry.

We understand that subsequent to the N. R. A.'s having been declared unconstitutional its organization collected information regarding code application to the construction industry. No such report has been made public. We urge that this information be made available to the construction industry as well as to your committee, since it would seem most unwise to enact similar legislation without due consideration of previous experience.

It is our conviction that a basic weakness lies in a provision of this bill delegating undefined authorities to the Secretary of Labor. We oppose the principles of any one person holding such autocratic authority, which we believe is contrary to the basic democratic principles on which American industry has grown and developed. We see in such authority the necessity for a tremendous staff of investigators, clerks, and accountants, all leading to bureaucratic red tape and added burden on industry which must necessarily be passed on to the consumer or the taxpayer.

We feel that regulations prohibiting child labor should be encouraged, but the importance of this matter would seem to justify legislation dealing only with this issue.

We feel that much included in this proposed bill is redundant and unneces sary as there is now in existence a number of laws which, as far as the construction industry is concerned, accomplish many of the purposes of this bill. One is the Bacon-Davis act, establishing prevailing wages on Government contracts. Another is chapter 5 of title 40 of the Revised Statutes of the United States, which embodies three laws (1892, 1912, and 1913), establishing the maximum workday of 8 hours on Government contracts. A third is the act passed in the last session of this Congress commonly known as the "kick-back act" prohibiting rebate of wages.

We therefore suggest that Government construction contracts are already well covered in existing statutes and that there is no need of further legislation of this type.

Respectfully submitted.

NEW YORK.

CONSTRUCTION LEAGUE OF THE UNITED STATES,
HEALEY BILL COMMITTEE

By CARLTON S. PROCTOR, Chairman.

Mr. Newton is the first witness.

STATEMENT OF HON. CLEVELAND A. NEWTON, REPRESENTING THE ST. LOUIS SHOE MANUFACTURERS' ASSOCIATION AND THE MISSISSIPPI VALLEY ASSOCIATION

Mr. NEWTON. Mr. Chairman and gentlemen: We have heard at different times during these hearings references to a controversy between Missouri and Massachusetts.

Mr. HEALEY. It seems that we did have something of that kind.. Mr. NEWTON. I really do not think there is very much ground for that controversy.

Mr. HEALEY. I hope not.

Mr. NEWTON. We probably have competitive interests, but I do not think they are so direct or so serious as to blind the real issues. here.

As a matter of fact, we had some issues involved in the writing. of the shoe code. We had a great many small-town factories which were concerned about the provisions of that code. I happened to be the spokesman for about 350 to 400 of those small-town factories and they were not all in the Middle West. They were in the South; they were in Ohio, Pennsylvania, and they were in Maine.

There was a difference in working and living conditions which necessitated a differential which would equalize the disadvantages of the small-town factory.