out in the goal of full employment, we will have much the same condition that we had during the war, namely, that there will be jobs for all, but the Negroes will still carry the hod while the white men sit at the drawing board, and the Mexican still lay the railroad tracks or clean up around the yards of steel mills while the white men direct the operation of the railroads and the industrial enterprise where the Mexicans are employed. So it follows that if we are to have full democratic practices actively working in any full-employment era, we must specifically provide for fair employment practices, if we are to give full opportunity to the minorities in our country which we have heretofore denied them.

5. I, of course, am more deeply concerned with the means by which we are to bring about a democratic economy in America which will protect certain basic individual rights which we highly prize at the same time that we control or direct our economic opportunities so as to afford the people the highest standard of living which it is possible for us to give them. I fear that unless we are to overthrow our Government and destroy and set it aside, that we must operate as I insist we shall and can operate, under the framework of our Constitution including within that framework, the provisions and methods for amendments as they appear necessary. Therefore, I consider that the development of a means by which there can be greater liaison between the executive branch and the Congress and a more effective, fluid, and responsive operation of our Government is the most important question facing the country, even transcending questions of national well-being, and one which is least considered by all the socalled progressives or liberals who are concerned with ends but do not have the understanding of the need for means or the willingness to effect means to attain those ends consistent with basic, underlying American thinking.

It occurred to me, therefore, that H. R. 2202 was fundamentally weak in that it did not provide for a means by which the Congress could have a full opportunity to coordinate its activities with those of the Executive in planning the national budget as well as in passing on it after it was planned. H. R. 2202 provided for a joint committee on the national budget. However, it also provided that the executive branch of the Government should have a full year in preparing the budget; that it would submit it to the joint com.mittee at the first of each session, in other words, early in January; and that then the joint committee would have to act upon the legislative recommendations contained in the Budget by March 1, or, within less than 60 days. To my way of thinking, this constituted the imposing of an impossible task upon the Congress and one which neither the proponents of the legislation, nor the Executive, were entitled to impose upon the Congress, particularly when we call to mind the preponderance of expert statisticians, economists, and other research brains available to the executive branch of the Government as against the meager staffing of the Congress.

I therefore provided in H. R. 4181, under section 4-which is the same section of H. R. 2202 which deals with the preparation of the national budget-that the Executive Office of the President should prepare the national budget in consultation "with the Joint Committee on the national budget hereafter established in section 5, or

any duly authorized subcommittee thereof which it may designate." The language is found in H. R. 4181 in section 4 (a), page 8, beginning at line 23 and extending over to line 2 on page 9; in H. R. 2202, following the word "establishments" in section 4 (a) page 8, line 3. I tried to declare in this amendment that this joint committee of the Congress should be consulted with by the executive branch during all steps of preparation of the budget, as well as after it was prepared.

Consistent with this principle and this thinking, I also made an addition in H. R. 4181, to section 7, as it appeared in H. R. 2202, by adding after the word "request" in line 23, on page 11 of H. R. 2202, the following language:

The President and heads of departments and establishments shall transmit and deliver copies of all communications, information, or data relating to the preparation of the national budget which shall pass between them to the joint committee or any duly authorized subcommittee thereof.

This language appears in H. R. 4181, on page 12, at line 24, after the word "request."

By this language, I also attempt to make it clear that all data which is gathered by the executive branch of the Government and all thinking upon the subject of the national budget which is exchanged between the executive departments and agencies shall be openly and fully disclosed to the congressional joint committee, sitting all the time, as it is being developed and considered by the executive branch of the Government. Not only would this eliminate any possible charge of secret action or activities on the part of the executive branch, but it would enable the joint committee, if it was on its toes, as it should be, to be constantly advised of the program to be presented in the national budget and the situation of the national economy as disclosed by the data in the possession of the executive branch of the Government, so that the joint committee would not only have an opportunity to act intelligently upon the information available, but to make constructive suggestions in the preparation of the national budget.

To my mind, the Federal Government is a government designed to serve the people. The legislative branch has two functions-first, to lay down policies; and, second, to check upon the activities of the executive branch in order to see not only that policies are being carried out, but that the executive branch makes a full disclosure at all times of the conditions of the national economy, so that the legislative branch of the Government may function intelligently, quickly, and responsively to the needs of the people. The National Government should not be an instrumentality of national conflict, but it should be an instrumentality to serve the people. Political parties operating under this system can then address their attention to intelligently proposing alternative solutions to national problems based upon factual informa tion, and not reducing their activities to picayune sniping on the one hand and dishonest covering up of facts or of executive mismanagement on the other. I think any student of American politics today, when he analyzes the situation will state that at the present time the condition which I last analyze is the one which is most prevalent.

I have a firm conviction that a democratic parliamentary system, such as ours, cannot solve the complex problems which confront our

people and world civilization today on any such basis. I, therefore, am of the opinion that the development of certain principles and policies of cooperation and intelligent checks and balances in the National Government is the most important problem which must currently be solved if we are to fulfill our American destiny, which I conceive to be the development of a system under which the fullest possible economic development can be presented and at the same time the dangers of static bureaucratic control avoided.

This has been a longer statement than I anticipated writing, but in fairness to myself and the thinking which motivated me in the preparation of H. R. 4181, could not be expressed adequately in any other way. Now, there is no congressional immunity, so far as I am concerned, to the grilling, gentlemen.

Mr. COCHRAN. I would just like to ask you one question, Mr. LaFollette.

Mr. LAFOLLETTE. Yes.

Mr. COCHRAN. Where you speak of the relocation of industry, in connection with the defense plants that we already have. To carry out your suggestion would it require an amendment to the present Surplus Property Act?

Mr. LAFOLLETTE. Well, it well might. Let me say this; the structure of this legislation which we are considering, the original Patman bill, and the one I am talking to, actually calls for a consideration by the President of certain legislative policies, in the first instance, which are calculated to let the free-enterprise system absorb all of this employ-, ment. Then when he submits his budget, the legislation provides he shall make certain rcommendations as to legislative enactments, and I include this in there. Some of those are competition, fiscal policy, and so forth. When he offers his recommendations for legislative enactment-it might well be that what you say is true-but the passage of this bill does not call for an immediate amendment. The whole legislative program calculated to carry out the national budget is likewise submitted with the budget under the provisions of this bill. So, while I would not be prepared to say it would not require an amendment, the fact that it may require an amendment subsequently is not a present objection to the proposals that I am making. Because it is simply of the same type as those presently in the bill.

Mr. COCHRAN. You indicated, as I followed you, that in the location of industry, or the relocation of industry, labor had nothing to fear. Mr. LAFOLLETTE. I said as long as we had Federal laws maintaining fair labor standards and fair labor practices.

Mr. COCHRAN. That goes along with your relocation?
Mr. LAFOLLETTE. Exactly; and I specifically say so.

Mr. COCHRAN. I think that is extremely sound, for this reason: I have an outstanding example. My own city was considered and is considered the greatest shoe manufacturing center in the world. We have large shoe-manufacturing corporations there. It so happened that up in my district we had about 6 very large plants. The shoe manufacturers conceived the idea years ago of going out in the country and constructing small plants. Towns out in the country made all sorts of inducements to the corporations to locate there. As a result, the shoe industry constructed what you might term small shoe factories in comparison with the ones that were in St. Louis, in probably 50 or 75 towns in Missouri, Illinois, and some even in Indiana.

Mr. LAFOLLETTE. The Brown Shoe Co. went to Vincennes.

Mr. COCHRAN. When they went there, the shoes that were being made were being made with machines controlled by the United Shoe Maehinery Co. We had skilled shoemakers who received an excellent wage in St. Louis. The truth of the matter is, they went out, for one reason, to get rid of paying high salaries. They would send a few skilled shoemakers out to these factories as they opened up, and they secured country labor, unorganized, to run the machines. You might say that the higher class of shoes was not made in these factories at the outset. As a result of the shoe corporations opening up these small factories it put the skilled shoe workers out of business in St. Louis, to a large extent. It has not been until recent years that there has been real organization among the shoe workers in the small towns where they constructed these factories. All of which is a clear indication to me that your suggestion is sound with reference to fair labor standards.

Mr. LAFOLLETTE. We have got to have fair labor standards along with it. That was one of the reasons we needed the Fair Labor Relations Act. It was a national problem affecting the national economy and the capacity to organize in isolated areas of the country should be protected by the Federal Government. That, along with fair labor standards and fair labor practices, would insure the people would live under better conditions. There are great arguments being made all the time, and some of the strongest are being advanced by the Soviet Union and by the American Communists, that a higher standard of living occurs where there is industrial effort in a locality, and that those countries that are purely agricultural, it is impossible for enough wealth to be created to bring about a higher standard of living. that one of the boasts of the Soviet Union is that wherever they go. they create local industry.

Mr. COCHRAN. They what?

So

Mr. LAFOLLETTE. They create local industry in the local area. Now, if that is a sound practice, then a democratic country can use democratic means to effect those same sound practices. In other words, we don't condone the things we disapprove of in connection with the operation of the Soviet Union, we will say, but I am not averse to copying what my worst enemy does if I think he does it well, provided I do it under a method which is suitable to my method of living. And I think one of the great problems in the South today is this question of getting some industry. But they must accept it under Federal standards of labor. Otherwise, they won't benefit from it.

Mr. COCHRAN. Have you any questions, Mr. Hoffman?

Mr. HOFFMAN. Yes. May I ask them now?

Mr. COCHRAN. Yes.

Mr. HOFFMAN. This bill provides for full employment at a remunerative wage?

Mr. LAFOLLETTE. Well, I know mine does specifically. I think that is one of the weaknesses in the Patman bill; it doesn't say anything about fair labor standards, let alone fair labor practices.

Mr. HOFFMAN. So that you would be under fair labor standards-
Mr. LAFOLLETTE. And practices.

Mr. HOFFMAN. You mean Government standards?
Mr. LAFOLLETTE. Exactly.

Mr. HOFFMAN. That provides for a minimum wage, does it not? Mr. LAFOLLETTE. Yes.

Mr. HOFFMAN. Briefly, what is the reason for a minimum wage? Mr. LAFOLLETTE. To me, the reason for a minimum wage is to provide, in a democratic economy, a sufficient purchasing power in the masses to consume the productivity of that economy.

Mr. HOFFMAN. I wonder if you really mean that. I had thought that the purpose of a minimum wage was to give to the worker sufficient money to provide him with-it's hard to say a decent home, because that term varies in localities-but with an average home, food, clothing, and schooling for his children.

Mr. LAFOLLETTE. I think all of that is included in the somewhat more inclusive definition that I used.

Mr. HOFFMAN. Someone must provide a job for these workers. That follows, doesn't it?

Mr. LAFOLLETTE. That is right.

Mr. HOFFMAN. This minimum wage doesn't make any provision for a less wage for the less skillful or less productive worker, does it? Mr. LAFOLLETTE. No.

Mr. HOFFMAN. That is to say, under your theory, every man who works should have that minimum wage-I mean, every man who is an employee.

Mr. LAFOLLETTE. Let me answer that in my own way. I say that you have stated a fact, and the necessity for that is that in order to keep a sufficient purchasing power in this Nation we have to resort to that method, to place a minimum wage upon services, so that people can consume. Otherwise our system runs down, and we cannot consume what we make. It is one of those things, whether we like it or not, that I think we are confronted with.

Mr. HOFFMAN. Then it is your theory that every employee, regardless of his ability to render service, should be paid the minimum wage fixed by the Federal Government?

Mr. LAFOLLETTE. If you say employee, my answer to that is "yes.” It is also my theory that if a person obviously cannot produce enough, a sufficient amount, to justify economically the wage that is being paid, that individual, of course, will not be employed in that industry. In other words, you can't force the employment of everyone-I quite agree with you. But I do say you are not going to sell the productivity of this country unless you have got people with buying power to consume it. And the people who ought to know that best are the people who own the plants that produce.

Mr. HOFFMAN. It is true, is it not, that in every factory, due either to the possession or lack of skill, the desire or lack of desire to work, and application to the job, there is a varying degree of productivity, and of usefulness, as between employees?

Mr. LAFOLLETTE. Right. But, of course, you don't fix a maximum wage; you fix a minimum.

Mr. HOFFMAN. Would you fix a ceiling on wages?

Mr. LAFOLLETTE. The only justification for fixing a ceiling on wages is the situation we have just been through, so that in times such as we have just been through, during a war, when the best part of our productivity is used for absolute waste, which is the conduct of war, so that there are not enough, civilian goods to be purchased by the in