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Next is substandard markets. Philadelphia workers and manufacturers are constantly haunted by the substandard market. The substandard market is constantly taking business from the decent employer and work from the skilled worker. In our competitive system, it is only natural that competition should be offered by other markets. We don't expect anything else. However, competition in the South is carried on solely on the basis of lower wage costs. The differential is average weekly earnings of the workers in Philadelphia and those in the southern markets is about 35 percent. These figures go far to explain the increasing number of establishments in substandard States at the expense of the Philadelphia market, which still pays its workers a living wage due to the high degree of unionization. The desire to move away to centers where manufacturers can carry on their competition against the country's leading markets solely at the expense of labor is becoming an ever-growing factor. It also, however, threatens the stability of the entire industry. Manufacturers who have moved from Philadelphia have found themselves in a worse position than those who have remained.

Accustomed as they are to operate their factories with skilled labor, with workers who have been in the textile industry all of their lives, and many workers who have inherited the industry from past generations, these manufacturers find themselves handicapped with the inexperienced help of other markets. However, the lure is constantly held out by these other markets, by their chambers of commerce, and by salesmen for these markets. It is also a fact that the textile industry in the South is strife-ridden. The general textile strike of 1934 brought forth more violence in the South than in any other part of the country. Edwin E. Witte, in his work, The Government in Labor Disputes, points out: "Weak unions are likely to be radical unions, and strikes against wage cuts peculiarly violent." Is it any wonder then that there was so much violence in the South? The discontent still rages, and, as Francis J. Gorman, first vice president of the United Textile Workers, has pointed out, if the bill fails of passage, conditions will demand another national strike. This will place the industry in a more serious condition than it was prior to the N. R. A,, when the employers came to Washington and appealed to the Government for assistance. During the period of the N. R. A., when an effort was made to regulate the industry, the migration was considerably decreased, and if the textile industry as a whole had adhered to N. R. A. standards, there would be no such threat, but the textile manufacturers more tha any other group have tended to depart from N. R. A. standards. Innumerable instances of this have been cited by officials of the United Textile Workers. The work load has been consistently increased. The present measure provides specifically that the change in work load can be made only after 15 days' notice by agreement with the workers.

When the commission deems it advisable, because of possibilities of overproduction serious enough to demoralize the industry, it may prescribe limitations on the number of machines, and it may regulate the work load. The textile industry today is in the same position in which southern American slaveholders were prior to the Civil War. Many of them deplored slavery, but were compelled to continue to maintain the institution because of the fact that others were maintaining it, and abolition of slavery in the South meant virtual extinc

tion. A similar condition today is existing in the textile industry. Many employers deplore the increase in the number of loads, the decreases in wages, but in order to survive they have no other alternative. The only solution is the passage of this bill.

Necessity for Federal legislation: Passage of State legislation is of no value whatever. If we were to provide in the State of Pennsylvania for a minimum wage, maximum working hours, and other guaranties to the workers, the only result would be to add impetus to the exodus. of manufacturers to low-wage centers and dislocate workers from their jobs.

Child labor, one of the greatest scourges of the textile industry, was rampant in the South prior to the N. R. A. The N. R. A. partially did away with this evil. Now it has again raised its ugly head. That is attributable to a multitude of causes. During the N. R. A. the workers being assured of a minimum wage was not interested in having his child work. Now the manufacturer having cut down wages of father and mother in a southern textile family, places the family in a position to virtually begging the employer to let the child work, so that it might contribute to the meager income of the almost destitute family. The employer has willingly heeded their prayer, and thousands of children are back at work in textile mills. This measure would tend to increase the earnings of the workers, outlaw child labor, and once more send the child back to the schoolroom instead of the loom. Even boys and girls between the ages of 16 and 18 are not permitted to work later than 7 p. m., and at occupations that would not impair their health.

As to minimum wages, Professor Nystrom, of Columbia University, prepared an estimate of the amount necessary for a worker's family to live in health and efficiency. The figures quoted were brought up to date with living costs as of December 1932. They state that the minimum necessary to support a family of five is $31 a week. Dr. Nystrom's study showed that a bare subsistence record is $26.77 per week. With living costs rising since then, the amount would probably be considerably increased. It is almost laughable to try to estimate how many textile workers earn that amount. I say that with the rest of the textile industry earning wages that are substandard, that the hosiery worker who earns a higher wage, is threatened. President Roosevelt, on June 16, on the occasion of affixing his signature to the National Recovery Act, said: "By living wages I mean more than a bare subsistence level. I mean wages of decent living." Thousands of textile workers today are not earning the bare subsistence level, let alone "wages of decent living." With collective bargaining guaranteed in the present measure, wages would automatically go up, but where there is no union agreement, the bill guarantees $15 a week for unskilled and clerical workers; learners are to receive 80 percent of the minimum. As far as skilled workers are concerned, it is made mandatory for the commission to investigate wage differentials, and it is then authorized to establish wages according to criteria set forth in the act. In that way, wages will be increased, not to the detriment of any individual, manufacturers, for the increase will be national, but toward a stabilization of the entire industry.

A maximum work week of 35 hours, with the elimination of all overtime, is essential if the textile industry is to provide employment for the thousands of workers for whom no jobs can be found now.

Notwithstanding the fact that hours are today regulated by a clause in the collective agreement, there are now close to thousands of workers who work spasmodically. The only way of reducing unemployment among the workers is to lower the maximum working hours, so as to spread the available work among a larger number of employees and over a longer period of time each year than is the case at present. In addition to those wholly unemployed, there is a substantial amount of part-time employment in the hosiery industry. If the reduction in the work week is to be maintained, overtime must be prohibited. That would tend to eliminate seasons. It would discourage distributors to continue to depend upon the large reserve of surplus labor and unrestricted overtime. Prohibition of overtime would compel the distributors to assume a responsibility. It would oblige them to anticipate consumer's demands and place their orders in advance of such demands. Prohibition of overtime would tend to eliminate the peaks and depressions of unemployment and tend to stabilize the industry.

To summarize, we feel that if the bill is passed, it will tend:

1. To foster collective bargaining, which automatically will mean increased wage rates, which automatically will mean the restoration of a balance in the textile industry.

2. Making the labor agreement with the union part of the manufacturer's license will automatically bring back peace in the industry, and will assure the workers that any labor agreement that is entered into between them will be enforced.

3. It will stop the migration and the threat of migration by manufacturers to substandard markets.

4. The only way, we feel, to obviate the evils of the textile industry, is by Federal legislation. State legislation merely tends to increase the temptation to flee from the State.

5. It will tend to eliminate child labor.

6. Establish a minimum wage.

7. Establish a maximum work week.

The approval of this bill will increase the earnings of the workers in the hosiery industry, and in the textile industry in general. It will increase their purchasing power, and make it possible for them to contribute to the industrial recovery of our country. We strongly urge upon this committee the passage of the bill and its recommendation to the House. We feel that otherwise the textile workers in the country will not be able to bear the evils imposed upon them any longer. Strife will result. Workers in many cases will find themselves brought to a point of desperation. Manufacturers will go out of business. The "dog eat dog" policy that has been pursued for so many years will finally bankrupt the entire industry, leaving manufacturers without businesses, and workers without livelihood.

Mr. WOOD. Do you know to what extent the southern textile mills have been reverting to the policy of employment of children under the age of 16 years?

Mr. LEADER. I believe the president of the federation will present many figures to you. The figures that I have with respect to that matter or from organizers that we have located in the South, and they came back with these reports. In addition to that, we are not free from that violation in the North either. We are continually on the job to prevent it.

Mr. WOOD. They are reverting to that policy in the North also, are they?

Mr. LEADER. Yes, sir; they are.

Mr. Wood. And possibly while doing so, they are not doing so, so extensively?

Mr. LEADER. That is right.

Mr. SCHNEIDER. You have read the bill through, Mr. Leader?
Mr. LEADER. Yes, sir; I have.

Mr. SCHNEIDER. And you understand it pretty well, I suppose?
Mr. LEADER. Yes, sir; I do.

Mr. SCHNEIDER. What is your opinion about paragraph 8, section 4, the National Textile Commission? I will quote it to you:

There is hereby created a commission to be known as the National Textile Commission which shall be composed of seven members appointed by the President by and with the consent of the Senate.

I find no requirements of representation of employees or the employer on that commission. In case the President happened to appoint a number of people with the psychology of the employer on that commission, what would be the result, in your estimation, in the administration of that act?

Mr. LEADER. I believe it is the intent of the sponsors of the bill that the rights of the workers will be taken care of. I mean by that in the same way as under the Wagner Labor Relations Act, and where any question comes up which is mutual or under the law is handled by the commission, it would be mutually agreed on by both sides. But at no time would they take away the economic right of the worker in the event of a strike in the industry.

Mr. Wood. But if the majority of the commission had the psychology of the unfair employer they would administer the act in favor of the employers, would they not?

Mr. LEADER. That may be so. But labor recognizes that it has to gamble with the fairness of some of those people in this whole situation. Perhaps they are ready to gamble at this time that the President will be fair in the selection of that commission, if he is the one that has the power, or that Congress will be.

Mr. WOOD. In other words, in this case labor is willing to leave its destiny in the hands of those whom the President will appoint and whom the Senate will confirm, believing that they will be men of integrity, ability, and understanding and will administer the law in the interest of all concerned and for the best welfare of the country as a whole?

Mr. LEADER. There is no doubt in the world about that.

Mr. HARTLEY. Did you say that someone else representing the industry was going to present figures with respect to child labor? Mr. LEADER. I believe they will be presented.

Mr. HARTLEY. That is definite, is it?

Mr. LEADER. Yes, sir; it is.

There is one other point that I would like to bring out which was not in my previous statement, and that is that in the Philadelphia area from 1929 there have been 38 hosiery mills which have moved out of that district; and in most cases they moved toward the South. During the life of N. R. A. we did not have the removal of one mill, but since N. R. A. has gone out there have been five mills which have moved, and there are about two more threatening to move. And all of them are going South. Each employer in the Philadelphia section

can show you a list of propaganda piled high on his table from all other districts as to why he should move South or to some other district near the South where wages are much lower.

Mr. KELLER. Why don't you bring some of that here to this committee?

Mr. LEADER. I believe all of this will be brought out in the later testimony.

Mr. KELLER. I want to know about that.

Mr. LEADER. We even have a sort of "blackbird" situation where we have a southern manufacturer who during the N. R. A. moved his plant North, but today he is shutting down and is moving down into West Virginia.

Mr. SCHNEIDER. You call him a "blackbird?"

Mr. LEADER. Yes, sir. He goes with the season and with Government regulations.

Mr. HARTLEY. What has been your experience with reference to the right to organize under the Wagner-Connery Act? Have you had any difficulty in connection with any of the mills in and around Philadelphia?

Mr. LEADER. In the North we have always been able to exercise our rights under the law if the law was not declared unconstitutional. Mr. SCHNEIDER. You found in some instances you were permitted to go in and organize?

Mr. LEADER. Due to our strength.

Mr. HARTLEY. Is that also true in my territory around New Jersey?

Mr. LEADER. In the Paterson district I believe that is so.

Mr. KELLER. Thank you very much, Mr. Leader.

We are now going to adjourn, and since we have carried over nearly a quarter of an hour we will return here at 2 o'clock.

An hour or so ago, Mr. Hartley, of New Jersey, made the statement that there were several hundred lawyers working in N. R. A. that were doing nothing except receiving their salaries. When I questioned that Mr. Hartley said he never heard it denied, and I took the privilege of denying it.

I immediately telephoned this down to the department; I simply had this read to the department, that—

Mr. Hartley, a Member of Congress from New Jersey, made the statement that there are several hundred lawyers in N. R. A. who are doing nothing but drawing their salaries.

I have contacted Mr. Vincent, Coordinator of N. R. A., in the Department of Commerce, and asked him for the facts in this case. He referred it to Mr. Marshall, the real head of the Department, and Mr. Marshall telephoned back this fact, that there are, roughly, 14 or 15 lawyers in the N. R. A. but that there will be a reduction on the first of the month of that number-not several hundred, but 14 or 15 at the outside.

I call your attention to it not for the purpose of taking a crack at my good friend Hartley; but is is so very easy to hear these stories and then go and repeat them, and when I heard that, I knew the inside of the N. R. A. so thoroughly well that I was surprised that there are 15 left.

Mr. HARTLEY. Mr. Chairman, first of all, let me make this correction of your statement. I did not make that statement.

Mr. KELLER. You said that the statement was made.

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