EMERGENCY PRICE CONTROL ACT

TUESDAY, DECEMBER 9, 1941

UNITED STATES SENATE,

Committee on Banking and Currency,

Washington, D. C.

The committee met at 10:30 a. m. in room 301, Senate Office Building, Senator Carter Glass presiding.

Present: Senators Glass (presiding), Barkley, Maloney, Radcliffe, Brown, Hughes, Herring, Clark of Idaho, Downey, Tobey, Danaher, Taft, Ball, and Butler.

Senator GLASS (presiding). The committee is assembled to consider the price fixing bill. Senator Wagner is ill and is unable to be present, and I am acting as chairman.

(H. R. 5990, together with an amendment thereto in the nature of a substitute, is here printed in full as follows:)

[H. R. 5990, 77th Cong., 1st sess.]

AN ACT To further the national defense and security by checking speculative and excessive price rises, price dislocations, and inflationary tendencies, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

TITLE I-GENERAL PROVISIONS AND AUTHORITY

PURPOSES; TIME LIMIT

SECTION 1. (a) It is hereby declared that it is in the interest of the national defense and security and the purposes of this Act are (1) to preserve the value of the national currency against the consequences of price and credit inflation; (2) to stabilize prices and to prevent speculative, unwarranted, and abnormal increases in prices and rents; (3) to prevent economic disturbances, labor disputes, burdens upon interstate and foreign commerce, interference with the effective use of the Nation's resources for defense, and impairment of national unity and morale, which would result from unwarranted increases in prices, rents, and the cost of living; (4) to eliminate and prevent profiteering, hoarding, manipulation, speculation, and other disruptive practices resulting from abnormal market conditions or scarcities caused by or contributing to the national emergency; (5) to prevent prospects of price rises from encouraging the accumulation and withholding of materials needed for national defense, and from impeding long-term commitments for production; (6) to assure that defense appropriations are not dissipated by excessive prices; (7) to obtain the maximum necessary production without undue profits to low-cost producers; (8) to protect persons with relatively fixed and limited incomes, wage earners, investors, and persons dependent on life insurance, annuities, and pensions, from undue impairment of their standard of living; (9) to prevent a postemergency collapse of values; (10) to stabilize agricultural prices in the manner provided in section 3; and (11) to provide procedures for administration and review which will fairly protect the interests of those subject to this Act, without endangering the dominant public interest in the accomplishment of the foregoing purposes.

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(b) The provisions of this Act, and all regulations, orders, and requirements thereunder, shall terminate on June 30, 1943, or upon the date of a proclamation by the President that the further continuance of the authority granted by this Act is not necessary in the interest of the national defense and security, or upon the date of enactment of an Act of Congress terminating such authority. whichever date is the earlier; except that as to offenses committed, or rights or liabilities incurred, prior to such termination date, the provisions of this Act and such regulations, orders, and requirements, shall be treated as still remaining in force for the purpose of sustaining any proper suit, action, or prosecution with respect to any such right, liability, or offense.

(c) The provisions of this Act shall be applicable to the United States, its Territories and possessions, the District of Columbia, and the Philippine Islands.

PRICES, RENTS, AND MARKET AND RENTING PRACTICES

SEC. 2. (a) Whenever in the judgment of the Price Administrator (provided for in section 201) the price or prices of a commodity or commodities have risen or threaten to rise to an extent or in a manner inconsistent with the purposes of this Act, he shall by regulation or order establish such ceiling or ceilings as in his judgment will be generally fair and equitable and will effectuate the purposes of this Act. So far as practicable, in establishing any ceiling, the Administrator shall ascertain and give due consideration to the prices prevailing for the commodity or commodities included under such ceiling between the dates of October 1 and October 15, 1941, and shall make adjustments for such relevant factors as he may, without undue burden on the economy, determine and deem to be of general applicability, including the following: Speculative fluctuations, general increases or decreases in costs of production and transportation, and general increases or decreases in profits earned by sellers of the commodity or commodities, during and subsequent to the year ended October 1, 1941. Every regulation or order establishing any ceiling under this subsection shall be accompanied by a statement of the considerations involved in the issuance of such regulation or order.

(b) Whenever in the judgment of the Administrator such action is necessary or proper in order to effectuate the purposes of this Act, he shall issue declarations setting forth the necessity for, and recommendations with reference to, the stabilization or reduction of rents for defense-area housing accommodations within defense-rental areas. If within sixty days after the issuance of any such recommendations rents for any such accommodations have not in the judgment of the Administrator been stabilized or reduced by State or local regulation, or otherwise, in accordance with the recommendations, the Administrator shall by regulation or order establish such ceiling or ceilings for such accommodations as in his judgment will effectuate the purposes of this Act. So far as practicable, in establishing any ceiling for any defense-area housing accommodations, the Administrator shall ascertain and give due consideration to the rents prevailing for the accommodations, or comparable accommodations, on or about April 1, 1940, and shall make adjustments for such relevant factors as he may determine and deem to be of general applicability in respect of the accommodations, including increases or decreases in property taxes and other costs, during and subsequent to the year ended April 1, 1940. In designating defense-rental areas, in prescribing ceilings for such accommodations, and in selecting persons to administer such ceilings, the Administrator shall, to such extent as he determines to be practicable, consider any recommendations which may be made by State and local officials concerned with housing or rental conditions in any defense-rental area.

(c) Any ceiling or ceilings may be established in such form and manner, may contain such classifications and differentiations, and may provide for such adjustments, as in the judgment of the Administrator are necessary or proper in order to effectuate the purposes of this Act. The Administrator may establish a ceiling or ceilings below the prices prevailing for the commodity or commodities, or below the rent or rents, in effect at the time of the establishment of such ceiling or ceilings.

(d) Whenever in the judgment of the Administrator such action is necessary or proper in order to effectuate the purposes of this Act, he may, by regulation or order, regulate or prohibit speculative or manipulative practices (including practices relating to changes in form or quality) or hoarding, in connection with any commodity, and speculative or manipulative practices or renting or

leasing practices (including practices relating to recovery of the possession), in connection with any defense-area housing accommodations, which in his judgment are equivalent to or are likely to result in price or rent increases, as the case may be, inconsistent with the purposes of this Act.

(e) Whenever in the judgment of the Administrator it is necessary, in order to effectuate the purposes of this Act, to obtain the production of marginal or high-cost producers, he may so notify the President and the President may direct any existing agency or agencies of the United States to exercise, and any such agency or agencies shall exercise in accordance with such directions, any authority heretofore or hereafter conferred on them by law to buy, sell, store, or use any commodity produced in the United States by any such producer: Provided, That any materials which have been heretofore or may hereafter be defined as strategic and critical materials and supplies by the President pursuant to section 5d of the Reconstruction Finance Corporation Act, as amended, may be bought in order to carry out the purposes of this Act only by corporations created or organized pursuant to said section 5d, upon such terms and conditions as they may determine, and only with the approval of the President and the Federal Loan Administrator: Provided further, That nothing in this section shall be deemed to modify, suspend, amend, or supercede any provision of the Tariff Act of 1930, as amended: Provided further, That nothing in this section, or any existing law, shall be construed to authorize any sale or other disposition of any agricultural commodity contrary to the provision of the Agricultural Adjustment Act of 1938, as amended.

(f) No power conferred by this section shall be construed to authorize any action contrary to the provisions and purposes of section 3.

(g) The powers granted in this section shall not be used or made to operate to compel changes in the business practices or cost practices or methods, means or aids to distribution established in any industry, except to prevent circumvention or evasion of any ceiling established under this Act.

(h) Regulations and orders issued under this section may contain such provisions as the Administrator deems necessary to prevent the circumvention or evasion of such regulations and orders.

(i) No price ceiling shall be placed upon any fishery commodity below the average price of such commodity in the year 1941 nor below the average costs of production at the time the ceiling is set.

(j) Any tenant may petition the Administrator to adjust the maximumrent ceiling applicable to his housing accommodations on the ground that such maximum-rent ceiling permits the receipt of an unduly high rent; whereupon the Administrator may, by order, adjust such maximum-rent ceiling in such manner or amount as shall, in his judgment, effectuate the purposes of this Act and provide a fair and reasonable rent for such housing accommodations.

AGRICUTURAL COMMODITIES

SEC. 3. (a) No ceiling shall be established for any agricultural commodity below (1) the market price equivalent to 110 per centum of the parity price or comparable price for such commodity, adjusted for grade, location, and seasonal differentials, as determined and published by the Secretary of Agriculture; nor (2) the market price prevailing for such commodity on October 1, 1941; nor (3) the average price for such commodity during the period July 1, 1919, to June 30, 1929.

(b) For the purposes of this Act, parity prices shall be determined and published by the Secretary of Agriculture as authorized by law: Provided, That in the case of any agricultural commodity other than the basic crops corn, wheat, cotton, rice, tobacco, and peanuts-the Secretary shall determine and publish a comparable price, whenever he finds, after investigation and public hearing, that the production and consumption of such commodity has so changed in extent or character since the base period as to result in a price out of line with parity prices for basic commodities.

(c) Any ceiling established on any commodity processed or manufactured in whole or substantial part from any agricultural commodity shall be consistent with the purposes set forth in subsection (a) herein and shall not be established in any manner as to circumvent, vitiate, or prevent the effectuation of such purposes.

(d) No provision of this Act or of any existing law shall be construed to authorize any action contrary to the provisions and purposes of this section.

PROHIBITIONS

SEC. 4 (a) It shall be unlawful, regardless of any agreement, lease, or other obligation heretofore or hereafter entered into, for any person to sell or deliver any commodity, to demand or receive any rent, or otherwise to do or omit to do any act, in violation of any regulation or order under section 2, or any regulation, order, or requirement under section 202, or to offer, solicit, attempt, or agree to do any of the foregoing.

(b) It shall be unlawful for any person to remove or attempt to remove from any defense-area housing accomodations the tenant or occupant thereof or to refuse to renew the lease or agreement for the use of such accomodations, because such tenant or occupant has taken, or proposes to take, action authorized or required by this Act or any regulation, order, or requirement thereunder.

(c) It shall be unlawful for any officer or employee of the Government, or for any adviser or consultant to the Administrator in his official capacity, to disclose, otherwise than in the course of official duty, any information obtained under this Act, or to use any such information for personal benefit.

(d) Nothing in this Act shall be construed to require any person to sell any commodity or to offer any accommodations for rent.

TITLE II-ADMINISTRATION AND ENFORCEMENT

ADMINISTRATION

SEC. 201. (a) There is hereby created the Price Control Administration. The President shall appoint a Price Control Administrator, by and with the advice and consent of the Senate. All of the duties of the Price Control Administration shall be vested in the Administrator and the Board of Administrative Review (created in sec. 202 (a)). The Administrator shall receive a salary of $10,000 a year. The Administrator may appoint, subject to the Civil Service Act, as amended, and the Classification Act of 1923, as amended, such personnel as may from time to time be appropriated for by Congress. The Administrator may utilize the services of Federal, State, and local agencies and may utilize such regional, local, or other agencies, and utliize such voluntary and uncompensated services, as may from time to time be needed. Attorneys appointed under this section may appear for and represent the Administrator in any case in any court. In the appointment, selection, classification, and promotion of officers and employees of the Price Control Administration, no political test or qualification shall be permitted or given consideration, but all such appointments and promotions shall be given and made on the basis of merit and efficiency.

(b) The principal office of the Administrator shall be in the District of Columbia, but he or any duly authorized representative may exercise any or all of his powers in any place.

(c) The Administrator shall have authority to make such expenditures (including expenditures for personal services and rent at the seat of government and elsewhere; for lawbooks and books of reference; and for paper, printing, and binding) as he may deem necessary for the administration and enforcement of this Act. The provision of section 3709 of the Revised Statutes shall not apply to the purchase of supplies and services by the Administrator where the aggregate amount involved does not exceed $250.

(d) The Administrator may, from time to time, issue such regulations and orders as he may deem necessary or proper in order to carry out the purposes and provisions of this Act.

SEC. 202. (a) There is hereby created in the Price Control Administration a Board of Administrative Review to be composed of five members appointed by the President by and with the advice and consent of the Senate. Each member of the Board shall receive a salary of $10,000 a year. The Board shall choose one of its members to be chairman. The Board shall be completely free and independent of the Price Control Administrator in the performance of all of its duties and functions. The Board may appoint, subject to the Civil Service Act, as amended, and the Classification Act of 1923, as amended, such personnel, including commissioners and attorneys, as may from time to time be appropriated for by Congress. Three members of the Board shall constitute a quorum. The Board may designate individual members, committees of members of the Board or Commissioners, to hold hearings from time to time in such places as may be designated by the Board. All decisions of the Board shall be agreed to by at least a majority of the members thereof. (b) The principal office of the Board of Administrative Review shall be in the District of Columbia, but such Board, a member, committee of members or any duly authorized commissioner or commissioners, may meet in any place within the United States or its Territories and possessions to conduct hearings and investigations.

SEC. 203. (a) The Administrator and the Board of Administrative Review or any member or commissioner thereof may administer oaths and affirmations, may require by subpoena or otherwise the attendance and testimony of witnesses and the production of documents at any designated place. No person shall be excused from complying with any requirements under this section because of his privilege against self-incrimination, but the immunity provisions of the Compulsory Testimony Act of February 11, 1893 (U. S. C., 1934 edition, title 19, sec. 46), shall apply with respect to any individual who specifically claims such privilege.

(b) The Administrator or Board of Administrative Review shall not publish or disclose any information obtained under this Act that such Administrator or Boards deems confidential or with reference to which a request for confidential treatment is made by the person furnishing such information.

SEC. 204. (a) Any person who is aggrieved by any order or regulation of the Administrator may, within thirty days after the issuance of such order or regulation, appeal such order or regulation to the previously mentioned Board of Administrative Review. Within thirty days of the filing of such appeal with the Board of Administrative Review the Board shall hold a public hearing on such appeal wherein any person who is affected by such order and who is aggrieved may present testimony. Upon the request of any aggrieved person affected by such order or regulation the Board shall subpæna such witnesses as he may designate. Within a reasonable time after the filing of such protest against any order or regulation, but in no case more than sixty days after the filing of such protest, the Board shall make a determination. The Board is authorized to affirm, amend, or modify such order or regulation, or may reverse or set aside the same in whole or in part. The determination of the Board of Administrative Review in all such appeals shall entirely supersede and stand in the place of the original order or regulation of the Administrator.

(b) Within thirty days after the determination of the Board of Administrative Review any person aggrieved by such determination may file a petition to review such determination in the circuit court of appeals for the circuit in which the complainant resides, or in the United States Court of Appeals for the District of Columbia, and thereupon such court shall have the same powers with respect to such determination as in the case of an order of the Federal Trade Commission under section 5 of the Federal Trade Commission Act. The order of the court shall be subject to review by the Supreme Court of the United States upon writ of certiorari as provided in section 240 of the Judicial Code.

ENFORCEMENT

SEC. 205. (a) Whenever in the judgment of the Administrator any person has engaged or is about to engage in any acts or practices which constitute or will constitute a violation of any provision of section 4 of this Act, he may make application to the appropriate court for an order enjoining such acts or practices, or for an order enforcing compliance with such provision, and upon a proper showing a permanent or temporary injunction, restraining order, or other order shall be granted without bond.

(b) Any person who willfully violates any provision of section 4 of this Act, and any person who makes any statement or entry false in any material respect in any document or report required to be kept or filed under section 2 or section 202, shall, upon conviction thereof, be subject to a fine of not more than $5,000, or to imprisonment for not more than two years in the case of a violation of section 4 (c) and for not more than one year in all other cases, or to both such fine and imprisonment. Whenever the Administrator has reason to believe that any person is liable to punishment under this subsection, he may certify the facts to the Attorney General, who may, in his discretion, cause appropriate proceedings to be brought.

(c) The district courts shall have jurisdiction of criminal proceedings for violations of section 4 of this Act, and concurrently with State and Territorial courts, of all civil proceedings under section 205 (a). Such civil proceedings