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Mr. WELCH. How does your production now compare with the production of that period? You have approximately double the number of employees?

Mr. WEST. Yes, sir.

Mr. WELCH. What is the comparative production of your materials?

Mr. WEST. We have not quite doubled it. It is only about 40 to 50 percent more, because we were operating at that time a single shift of 55 hours, and we are now operating two shifts of 40 hours each.

Mr. WELCH. Have you laid off any of your employees during that period, by reason of new methods of production, new machinery, and speeding up processes?

Mr. WEST. No, sir. There may have been individual cases where. they were temporarily laid off. The way we try to operate it, Mr. Welch, is that when we have occasion to make a change in our work at times for any reason, whatever it is, that is, new machinery, new methods, or new processes, we endeavor to do it sufficiently slowly to take up the displaced workers so that we have jobs for them elsewhere. And we have such a large plant that the normal labor turnover in our plant has enabled us to do that and handle it that way. There have been no workers that have been permanently separated from their work for that reason. We just do not do it that way.

Mr. WELCH. That is all, thank you.

Mr. WOOD. A while ago you used this report made by Daniel Roper, Secretary of Commerce; Mr. Hull, Secretary of State; Mr. Wallace, Secretary of Agriculture; and Miss Frances Perkins, Secretary of Labor. I think you tried to prove the point you made about the hours of labor and the machine loading. Of course, it says nothing about machine loading; but this is the first recommendation of the committee [reading]:

Based upon the facts submitted in this report and other data and information available to your committee, we herewith submit to you our findings and recommendations. A summary of these findings and recommendations is as follows: Excess capacity and obsolescence.-Finding that excess capacity and obsolescence are serious problems in the cotton-textile industry, we recommend such legislation and administrative action as may be necessary and feasible to deal with this problem through one or more of the following methods:

(a) The limitations on the hours of machine operations;

(b) A leasing system for retiring surplus equipment;

(c) The purchase and retirement of the most obsolete units after a probationary period under the leasing system.

That report, of course, recommends the regulation of the hours of labor. The reason they make that report is that the hours of labor are generally excessive in the industry.

Mr. WEST. Just where is that in the report, sir?

Mr. WOOD. That is right in the beginning, right at the very start. It starts on page 3. This is the letter of the Cabinet committee to the President. That is the first recommendation, limitation of the hours of labor.

Mr. WEST. Where does it say that in that first recommendation? Mr. WOOD. It says, "Limitations on the hours of machine operations."

Mr. WEST. Yes; but that is not limitation of hours of labor, Mr. Wood. That is limitations on the hours of machine operations. Please do not misunderstand me, sir; I do not want to appear to be argumen

tative. But the "limitations on the hours of machine operations", as discussed in this report, as you will see when you have an opportunity to study it all, has a very definite application. What it means is how long productive machinery is operated, whether it is one shift or two shifts. That is the machine operations; that is not the labor. That does not refer to the maximum hours of labor, sir. I think that will be clarified in your mind after you have had an opportunity to read the body of the report.

Mr. WOOD. Take your recommendation no. 10 on page V [reading]: Labor standards.—We commend the attempt of the industry to maintain the labor standards provided in the code. We recommend that the Government supplement such voluntary efforts as are being made by such administrative and legislative measures as may be feasible. We recommend also, with regard to such legislation as may be proposed, a further study to determine the specific improvements and labor standards which may be in the public interest.

Mr. WEST. Precisely.

Mr. WooD. What is improvement in labor standards? Is it the stretching of the hours or the reduction of the hours?

Mr. WEST. I do not think it means either, but may I point out that that statement in regard to the hours says nothing about prevail. ing excessive hours.

Mr. Wood. And "improvements in labor standards which may be in the public interest." Now, is it not in the public interest to spread employment by the reduction in hours?

Mr. WEST. Sir, to an extent. And I tried to point out here a few minutes ago that under the provisions in this bill which applies to the textile industry and which we are discussing, the reduction in hours from the prevailing 40 hours to the contemplated 35 hours will create no new employment.

Mr. Wood. Of course, as far as the reduction in hours is concerned, Miss Perkins and others naturally believe that that has been generally understood by all at this late date, that the reduction in the hours of labor is a foregone conclusion, that it is an absolute necessity. Miss Frances Perkins, as well as the President, has signified on numerous occasions that she is favorable to a 35-hour week.

Don't you know that the President used his influence and the administration used its influence to pass the Guffey Coal Act, which provides the 35-hour week? And certainly no one would say the President of the United States and Miss Frances Perkins, the Secretary of Labor, are not favorable to a 35-hour week.

I would like to know when you identified yourself with this firm in Danville?

Mr. WEST. In March 1930.

Mr. Wood. From where did you come to there? What was your connection before that?

Mr. WEST. I was president of the Lancaster Mills in Clinton, Mass., before that time.

Mr. WOOD. What was the relationship between the employees and employers when you went down to Danville?

Mr. WEST. Very strained.

Mr. WOOD. Was there a strike on at that time?

Mr. WEST. No, sir.

Mr. WOOD. There was no strike on?

Mr. WEST. No, sir; there was not. There was one subsequently. Mr. WOOD. Now, with respect to control of production, how do you expect stabilization to be accomplished if not by price fixing? How have you stabilized it in the past 3 years?

Mr. WEST. By limiting the hours of machine operation to two shifts of 40 hours each. There has been no price fixing in this industry, Mr. Wood.

Mr. WOOD. But there has been limited production?

Mr. WEST. Theoretically, yes; as a practical matter, no. The number of available productive machines or equipment in the cottontextile industry permitted to run 80 hours a week has been ample to take care of the off-take by the consumer, particularly in view of our loss of export markets and the continued threat of Japanese products in our market.

Mr. WOOD. In the absence of any legislation restricting the output or any legislation of this kind, how do you suggest you are going to keep your industry stabilized and maintain your operations?

Mr. WEST. Is it essential that I discuss maintenance of operations as a result of every question, because, sir, I have stated that four times? Mr. WOOD. Of course, we all agree in the years 1930, 1931, and 1932, the prices were at rock bottom; and everyone agreed then that the tremendously low prices for the commodity were not good for the industry, and representatives of the various industries that came here in 1933, told us very frankly that something had to be done to maintain prices.

Mr. WEST. Was there a representative of the textile industry who made that statement?

Mr. WOOD. There were representatives of all the basic industries. Mr. WEST. I am asking you for information.

Mr. WOOD. Yes, indeed; there was.

Mr. WEST. I was not aware there was.

Mr. WOOD. Steel, textile, oil, railroads, furniture, lumber, and others.

Mr. KELLER. Banks and insurance companies also.
Mr. WOOD. Yes. They were all here.

Mr. WEST. I am asking you if textiles were here.
Mr. WOOD. Yes, indeed; they were here.
Mr. WEST. I am asking for information.
the record is of a cotton-textile interest?

Could you tell me where

Mr. KELLER. You could not, perhaps, on this account, Mr. West. I think I may butt in now and talk to you about it. When the men came here they felt it was not wise to make a record of the meetings. Just to illustrate the point, Mr. Mills, the Assistant Secretary of the Treasury, came before the meeting in one of the committee rooms but before he would talk he made this statement [reading]:

I want to feel entirely free to lay before you the conditions which exist in this country at this time. I will not feel myself justified in doing it unless and until I have the agreement of the members before me here that it will be kept entirely in confidence.

And we all agreed. Then Mr. Mills said these things, that unless the industries of the country-and he went on to name them very specifically could receive immediately a tremendous amount of help from the Federal Government, that every one of them would go to pot. He named the railroads, the banks, the insurance com

panies, and the others clear on down the line. That was not reported for the very simple reason that I have stated to you. But that Mr. Wood is entirely correct in his statement I think there is no possible doubt.

I think nothing was ever said about it until it had passed over. At that time we were at the bottom of the emergency that was in existence and, therefore, we immediately voted the R. F. C., which was simply a revival of the War Finance Corporation, and began by setting aside $2,000,000,000 for the use of the industry of the country as a starter. And since then we have voted several billions more. I think Mr. Wood is entirely justified in making that statement. Mr. WooD. And they had before this meeting representatives of the automobile industry, the electrical industry, coal, steel, oil, lumber, and everything you can think of. We had a representative of the Manufacturers' Association and the National Chamber of Commerce, and groups from everywhere. There were a hundred or more industrialists who testified, and they covered the whole field. Mr. KELLER. That part is printed?

Mr. WOOD. Yes; it is. It is right in these hearings.

Mr. WEST. As to this question of price, since that time I have been rather intimately associated with practically all branches of the cotton-textile industry and the merchants and the manufacturers, and I have not been aware of any who considered price fixing as a method of helping the industry. If one of them has urged it, I would like to get his testimony, because I might learn something.

Mr. Wood. You are getting away from my question. Aside from this so-called price fixing how are you going to keep up prices, whether it be price fixing or whether it be control of production, or whatever method you have? What method have you? Surely the textile manufacturers want to keep up the present basic prices.

Mr. WEST. We want better prices.

Mr. WOOD. You certainly do not want to go back to 1932?
Mr. WEST. No, sir. We want better prices.

Mr. WOOD. Or to 1933. I asked you what the cotton textile manufacturers had in mind as a method of keeping the present basic standard prices from going down. You want the prices to go up, of course.

Mr. WEST. The adjustment of our current production to the current demand for goods-production control.

Mr. WOOD. Of course, that is a general statement.

Mr. WEST. Yes; it is a general statement.

Mr. WOOD. But that does not answer my question. What method do you think should be employed? If nothing is done through legislation, what do you suggest be done?

Mr. WEST. The intelligent operation of the plants. The overproduction of the industry, Mr. Wood

Mr. WOOD. You just want to go along and operate your own industry without any governmental interference?

Mr. WEST. I will not say that. No, sir; I will not say that, not at all.

Mr. WOOD. How far do you want the Government to go? This bill contemplates going a certain distance, and we would like to have the opinion of the cotton textile manufacturers as to how far they want to go on Government control or Government supervisio

[graphic]

Mr. WEST. I do not think Government supervision

Mr. WOOD. Do you need any?

Mr. WEST. I do not believe we need the supervision of the Government as contemplated in a bill of this kind.

Mr. WOOD. Do you think you need any?

Mr. WEST. The time may come when we will.

Mr. WOOD. I am not talking about this bill but about the extent of the regulation, if any, that you need now. Can you mention something?

Mr. WEST. No, sir. At the moment I do not believe that it is essential for Government regulation of the textile industry.

Mr. WOOD. You think nothing should be done, but we should let it remain in status quo?

Mr. WEST. Except the protection of our markets and giving us a fair chance in the markets, this situation having been brought about by conditions that have arisen because of Government activities. We pass a bill and we set up a regime in the industry which enormously raises the cost and immediately puts many of the products on the shelf. We have lost our export markets and are under a constant threat in the home markets. We cannot produce goods as cheaply as Japan; but we ought to have our markets. We permit jute to come into this country to be made into bags. But thousands and thousands and thousands of bales of cotton could be consumed and thousands of yards of cloth used.

Mr. WOOD. Then you favor Government regulation by tariff to protect your prices against foreign importations? And, of course, I am in favor of that, and every good citizen is. But how far do you expect the Government to go to protect the employees in their wage standards? If the Government is going to protect you against the importation of cheap goods that will destroy your prices then don't you think the Government ought to go far enough to protect the wage earners in their standards against unscrupulous employers?

Mr. WEST. Yes, sir. Of course, that immediately brings up the question of the Federal Government and the way in which it is done. It seems to me that the difficulty with that phase in Government regulation is the rigidity of it; for instance, a maximum 35-hour bill when that is the maximum and there is no latitude and no leeway in it. Mr. WOOD. Suppose that is necessary to take up the slack in the employment?

Mr. WEST. It does not take up the slack of unemployment in the textile industry. By going to 35 hours the textile industry can contribute nothing to the unemployment situation except by going on three shifts.

Mr. WOOD. That is what all of the opponents of this legislation. have contended. But some of the members of the committee have a different opinion about it.

Mr. KELLER. Mr. West has now been on the stand for a little more than an hour and a half, and we have about five more witnesses to hear this evening.

Mr. WOOD. I would like to ask one or two more questions.

Mr. KELLER. All right, then.

Mr. WOOD. The consumption of textiles, that is, the consumption of cotton textiles in this country, is no greater than it was 5 or 6 years ago. You said that the consumption of textile goods in this country had been increased.

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