TABLE 1. Cost of living, actual and real average weekly earnings in manufacturing

industries, 1919-41

1 Data from Monthly Labor Review, November 1941, adjusted to agree with data in Monthly Labor Review for September 1940.

2 First 9 months average.

Source: Average Weekly Earnings: Monthly Labor Review, September 1940; "Wages, Hours, and Productivity of Industrial Labor." Cost of Living Index: U. S. Bureau of Labor Statistics. Real Average Weekly Earnings: Average Weekly Earnings Deflated by Cost of Living Index.

AFTERNOON SESSION

The committee reconvened at 2:30p.m., upon the expiration of the

recess.

Senator BROWN (presiding). The committee will be in order. Is there anyone here who desires to be heard or to have a time fixed when he can be heard, other than those with whom we have already talked?

I might say that it now looks as if we would be finished with the Government witnesses perhaps this afternoon, certainly tomorrow, and I think we ought to use the rest of the week in hearing some other interested parties.

Senator TAFT. May I ask Mr. Henderson whether he has any suggestions that might be useful? I suppose he heard everybody who appeared before the House committee.

Have you any suggestions as to any Member of the House or any other people who might be able to throw light on the subject?

Mr. HENDERSON. I believe that one of the retail organizations wanted to be heard.

Senator TAFT. I know that there are three or four chambers of commerce that sent me letters saying that they had wholesalers and retailers who wanted to be heard.

Mr. HENDERSON. It has been surprising to me how few people have asked us to intervene to get them an opportunity to discuss the bill. Senator BROWN (presiding). Before you begin, Mr. Henderson, I wish to state that there are six or seven members of this committee who are on the Finance Committee, and we have an important bill up for consideration tomorrow at 10:30. I have told Senator George that we would be there, and after consulting with Senator Glass, Senator Glass is agreeable to eliminating the hearing here tomorrow morning, but we shall meet at 2 o'clock tomorrow afternoon. There will be no session tomorrow morning.

I now want to place in the record a letter sent by Senator Danaher to this committee.

(A letter of December 6, 1941, from Senator Danaher to the Senate Committee on Banking and Currency, is as follows:)

BANKING AND CURRENCY COMMITTEE,

UNITED STATES SENATE,

United States Senate, Washington, D. C.

Attention: Miss Adams.

December 6, 1941.

GENTLEMEN: At a member of this committee I write to forward to you a prefatory statement and outline of the essentials necessary to an understanding, not only of the problems involved in rent control but of the enclosed plan to achieve that objective. It is my purpose to call the plan to the attention of the entire committee for its study and consideration. To that end I respectfully request that all of the enclosed data, together with my letter of transmittal, be printed in full in the record that it may be readily available when we take up H. R. 5990. The plan, while modeled on the District of Columbia plan, requires certain modifications, as a study will reveal.

This contribution has been submitted by a highly qualified expert, Mr. Richard F. Jones, Jr., of 49 Pearl Street, Hartford, Conn. Mr. Jones is a graduate of the Sheffield Scientific School at Yale University, 1928, having studied civil engineering and building construction. He was chief engineer in the building of the large Bushnell Memorial Auditorium in Hartford and has served as construction engineer on many building projects. He is largely interested in the realestate management business, is widely consulted as an expert by banks, insurance companies, and real-estate owners. He has had wide civic and public experience of a high order.

I commend the views and the study submitted by Mr. Jones to the earnest attention of the committee.

Faithfully yours,

JOHN A. DANAHER.

A PLAN FOR THE CONTROL OF RENTS BY RICHARD F. JONES, JR., 49 PEARL STREET, HARTFORD, CONN., NOVEMBER 19, 1941

The following assumptions are basic and essential to an understanding of the 14. The mobilization of housing all housing cannot be effectively accomplished under a multitude of agencies.

15. The placing of rent control under price control would create still another housing agency.

OBSERVATIONS AND OPINIONS

For a complete understanding of the plan the following observations and opinions of the author are offered:

1. Any plan for control of rentals should be integrated with the policy of an existing agency now interested in housing such as: Reconstruction Finance Corporation, Federal Housing Administration, Housing Coordinator.

2. The administrator of the plan must have a clear conception of existing trends in economics and social relations, must have a "social conscience" and should have a thorough knowledge of the real-estate and mortgage business. He should be completely familiar with present attempts at voluntary control through so-called fair-rent committees. If possible, he should have helped to organize and certainly should have served on such a committee. He should know their weaknesses and possibilities.

3. The greatest weaknesses of the fair-rent committees have been: A. Lack of adequate facts on which to base decisions.

B. Knowledge on the part of uncooperating owners that the committee had no power to enforce its decisions.

C. Frequent failures by the committees to follow up their decisions in order to determine whether or not to give publicity to recalcitrants.

D. Inability to control the eviction problem caused by landlords seeking reprisal against complaining tenants.

4. It is the author's opinion that rent control should be under the direct supervision of Mr. Jesse Jones.

THE PLAN

1. Authorize the appointment of an Administrator of Rent Control by the Secretary of Commerce. The Administrator shall maintain constant liaison with all housing agencies which shall be required to furnish him with such information and assistance as in the judgment of the Secretary is desirable.

Fair-rent authorities

2. Authorize the Administrator to select fair-rent authorities in each designated defense area from lists of nominations provided by the executive officers of the individual municipalities making up that defense area. (It might be desirable to require the selection of the Chairman of the Housing Authority where one exists.) The local communities acting through their executives or by election shall be given the right to replace their representatives on the Authority at such intervals and by such means as these communities shall determine.

3. The Administrator would determine the pro rata number of representatives of each municipality to serve on the Authority on the basis of the last census.

Defense-area offices

4. Authorize the Administrator to set up a local office in each defense area which would serve as the executive office of the Authority.

Deputy Administrators

5. Appoint a Deputy Administrator in charge of each local office.

Survey

6. Require each local office to make a detailed survey of its designated area. This survey shall require the owner of every piece of property having a rented or a rentable unit to file a report. This report under oath shall provide such data regarding these units as the Administrator requires. A filing fee of $1 per unit shall be charged and similar reports shall be required annually. The Administrator shall be authorized to employ such temporary expert assistance as required. From this data and with the aid of said expert assistance and after consultations with the local authority, a fair rent shall be established by the Administrator for each type of rented unit in each section of the defense area. The Authority: shall have free access to all local office survey data.

Fair rent

7. Fair rent as used in this plan is that rental which was paid for a given unit on the date selected by the local authority as the fair-rent date except that said rental must represent an average market rate as determined by the survey. Increases or decreases in operating costs which had taken place since the establishment of the fair-rent date would be legal additions or subtractions on a pro rata basis to the fair rental for each unit and said new rate would be known as the adjusted fair rent.

8. If the costs of construction in a given defense area increase or decrease by 10 percent or more of the index cost of construction on the fair-rent date, then the Administrator shall increase or decrease the adjusted fair rentals by the same percentage. The Secretary of Commerce shall supply said index. These increases or decreases shall be determined semiannually.

Same procedures as present fair-rent committees

9. The local authority would thus have competent technical advice and data on which to base its decisions. It would hear both tenants and landlords just as the present fair-rent committees do. It would file its decisions with the local administrator's office for "follow-up."

10. The machinery and methods described above would still continue the voluntary method of rent control by communities. The local office would act as a clearinghouse for complaints, provide facts and counsel and encouragement to the local authority, try and obtain support from local labor and financial groups, seek newspaper support and follow up the decisions of the authority in every possible attempt to obtain cooperation and success for the voluntary method.

Penalties for retaliation

:

11. This plan would require that it be termed a misdemeanor to retaliate, harass, threaten, or obtain eviction of a tenant because he took his case to his local authority. Appropriate penalties should be provided for this offense at

once.

Failure of voluntary control

12. If on recommendation of the Secretary of Commerce, the President shall find that a local defense area has failed to maintain fair-rental conditions and such failure constitutes a direct threat to the national welfare, then the President by Executive order shall authorize the Administrator to freeze said local rents and to proceed with the establishment of adjusted fair rentals as described in paragraphs 7 and 8.

13. Where adjusted fair rentals are established by order of the President, the local Deputy Administrator with or without consultation with the local authority shall make all future determinations of rentals under the direction of the Administrator.

14. Appropriate penalties would be provided to insure compliance with paragraphs 12 and 13.

15. In general, the details of the act would then follow the District of Columbia plan, except for the important modifications herein noted.

PERTINENT DATA REGARDING RICHARD F. JONES, JR., HARTFORD, CONN.

1. Birth. Born in Hartford, Conn., May 18, 1906.
2. School. Educated in schools of Hartford, Conn.

3. University. Graduated (B. S. degree) from Sheffield Scientific School of Yale University after course in civil engineering and building construction,

1928.

4. Engineer.-Employed on several building projects as construction engineer, including post of chief engineer on Hartford's $2,000,000 Bushnell Memorial Auditorium, up to 1933.