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diately prior to the code and after the depression with the general difficulty with which all such efforts were faced at that time during the terrific depression.

Immediately after the code was invalidated there was the fear which was entertained largely in our industry that there would be a return to the longer hours that had prevailed prior to the time of the code, that there would be a return to lower wages and lower rates. It was a situation which gave those of us who were charged with the responsibility of dealing with policies of the industry as a whole, enormous concern. We were told time and time again that it would be impossible for the industry to do anything but revert to earlier hours and earlier wages.

Mr. KELLER. That is, the longer hours and lower wages? Mr. DORR. Yes, sir; the longer hours and lower wages. We did not know what could be done. We felt what ought to be done was to try to continue the general standards that had been set up, that is, the new standards. And every organization in the industry recommended that course to its members. There was a feeling by those who did not want to pursue that policy that it would take only 2 or 3 weeks before there was a break-down in such observance. Then when a couple of weeks went by and some of those who had departed from the code came back it was said, "Well, by fall it will all be gone.'

That question as to whether or not there would not be some widespread break-down was always before us. All of us felt that the thing to do was to make every voluntary effort to continue those standards. And I think everyone who has been concerned with the matter has felt an increasing confidence that voluntary results could be obtained. And with increasing confidence as time went on the standards of the industry in other respects have been permanently improved.

You have now before you a proposed bill to regulate child labor, hours, and wages. Those are the fundamentals. And I suppose the question that immediately arises for your consideration is: Does the Constitution confer upon Congress the power to make those regulations?

Mr. KELLER. Yes, sir.

Mr. DORR. It is the question of desirability and the question of power. That is a matter for your consideration and it is your responsibility, not mine. All that I propose to do with regard to that is to advert to the provisions of the bill and the provisions of the Constitution under which the power to accomplish those results and make those regulations is invoked, and to refer to certain decisions of the Supreme Court which seem to me to affect that question, which is a question for you.

What provisions of the Constitution does this bill invoke?

As

Broadly speaking, there seem to be three. First, the power conferred upon Congress by the Constitution to regulate commerce. I read it, that is the fundamental thing that this bill relies upon. As auxiliary to it there appear to be two other powers that the Constitution confers upon Congress which were also invoked. One you might speak of broadly as the spending power. The third is the power conferred by Congress to deal with post offices and post roads or the mails. That, it seems to me, to be the scheme of the act; that is, to rely upon those three powers.

Let us take the first power, the power to regulate commerce. This power to regulate commerce among the States is the first. Does the power to regulate commerce among the States carry with it the power to regulate directly or indirectly the wages and hours of employees in a cotton mill and as to whether or not the cotton mill shall or shall not employ child labor?

The scheme of regulation that seems to be provided for by this bill is the prohibition of the transportation of the goods. Of course, the power of the Congress to deal with the transportation of goods is perhaps the simplest form of its exercise of power in dealing with commerce. The proposal here is to regulate transportation and by determining what is carried in transportation to reach back and affect what is done in the creation of the goods themselves.

That is not the first time that it has been proposed in Congress to deal with this kind of a problem in that way. Congress, in fact, acted upon that theory in the past when it passed the child-labor laws which were designed to affect the use of child labor in the mills by prohibiting the transportation of products in interstate commerce which had been created by them, under certain limitations and conditions.

That act came before the Supreme Court. It was contended that there was absolute power on the part of the Congress to prohibit anything from being transported, or for any reason. It was contended that certainly that there was the power to prohibit the transportation of goods made by child labor because of the effect, of what is described as the unfair effect of having one standard of employment in that respect in one State but another standard in another State, and the State which had the lower standard would have a commercial advantage in the interstate commerce of the country by reason of that divergent in standards.

That argument was stressed strongly. Particularly the argument that there was an absolute power to prohibit was accepted by a minority of the Court.

Mr. KELLER. What was the vote on that?

Mr. DORR. In the first Child Labor Case I think it was five to four. But the majority of the Court did not take that view, and their decision was that this act went beyond the power of Congress under the Interstate Commerce Clause.

It is interesting to look at some of the things they said there, because it seems to be the same kind of an argument which would be made to support the present bill. For example, they say, "The making of goods and the mining of coal are not commerce, nor does the fact that these things are to be afterward shipped or used in interstate commerce make their production a part thereof."

Mr. KELLER. What is that case?

Mr. DORR. Hammer v. Dagenhart (247 U. S. 251). This case came up with regard to a cotton mill. So in this case they were dealing with the power of Congress to regulate with regard to child labor in a cotton mill.

Mr. KELLER. This is from the opinion of the majority of the Court? Mr. DORR. It is from the opinion of the Court. That is the decision of the Court.

The Court said:

The making of goods and the mining of coal are not commerce, nor does the fact that these things are to be afterward shipped or used in interstate commerce

make their production a part thereof. Over interstate transportation or its incidents, the regulatory power of Congress is ample, but the production of articles intended for interstate commerce is a matter of local regulation.

They said further, in speaking of the contentions:

It is further contended that the right of Congress may be exerted to control interstate commerce in the shipment of child-made goods because of the effect of the circulation of such goods in other States where the evil of this class of labor has been recognized by local legislation.

And they were dealing with something which the court regarded as an evil in its general characteristics.

It is further contended that the right of Congress may be exerted to control interstate commerce in the shipment of child made goods because of the effect of the circulation of such goods in other States where the evil of this class of labor has been recognized by local legislation, and the right to employ child labor has been more vigorously regulated than in the State of production.

And I want to call your attention to this particular language: In other words, that the unfair competition thus engendered may be controlled by closing the channels of interstate commerce to manufacturers in those States where the local laws do not meet what Congress deems to be the more just standards of other States. There is no power vested in Congress to require the States to exercise their police power so as to prevent possible unfair competition. Many causes may cooperate to give one State by reason of local laws or conditions an economic advantage over others. The commerce clause was not intended to give to Congress a general authority to equalize such conditions.

And again:

The grant of authority over a purely Federal matter was not intended to destroy the local power always existing and carefully reserved to the States in the tenth amendment to the Constitution.

Mr. ELLENBOGEN. Mr. Chairman, before leaving that case I wonder if I may ask about it.

Mr. KELLER. Surely, Mr. Ellenbogen.

Mr. ELLENBOGEN. Would you prefer to go on or shall I interrupt now?

Mr. DORR. The only thing, Mr. Ellenbogen, is it may be some of the things that I am going to say later will cover what you have in mind.

Mr. ELLENBOGEN. I do not think so. But you may go ahead, Mr. Dorr, and I will come back to it later.

The statute involving the Child Labor cases is entirely different from the statute before us. And it is not only my belief but that of eminent lawyers that if the statute in the Child Labor case would have been given more reasonably it would have been sustained.

Are you a lawyer, Mr. Dorr?

Mr. ELLENBOGEN. If you will look at the statute you will find Congress did not only prohibit the goods made by child labor from interstate commerce, but it prohibited the shipment of any kinds of goods by mills which employed child labor, which is going much further, if you please. They said any mill that employs child labor of any kind in any shape of goods. In that case Congress did not confine itself to prohibiting only the shipment of goods in interstate commerce which had been made by child labor. Don't you think that is a very important distinction?

Mr. DORR. I do not believe that in the opinion that was the only point the court had in mind.

Mr. ELLENBOGEN. No; that was not the only point. But the court very significantly says in that case that the statute went further than it was necessary to go to accomplish the purpose at hand. In other words, there may have been a hundred different goods made by a mill that were not made by child labor whose shipment was just as much prohibited by that statute though the goods had been made by child labor. So I don't think that case is any precedent for the bill at hand at all.

Mr. DORR. This bill now proposed has not been before the Court. And, of course, all that the Court actually decides, I think you may fairly say is the particular thing it has before it. But what I was pointing out was that in making the decision it made, whether it had to go to the length and express the views it did or not, it did do

So.

Mr. ELLENBOGEN. Anything contained in the opinion of the majority of the Court that does not necessarily deal with the decision is obiter dictum. Is that right?

Mr. DORR. If the Court uses certain reasoning as the basis of the decision, the courts are accustomed to regard that as precedent. But they do not have to.

Mr. ELLENBOGEN. The only precedent under the decisions of the Court is the decision. That is correct, isn't it?

Mr. DORR. In one sense, yes, Mr. Ellenbogen; and in another sense, no. For instance, the language in Gibbons v. Ogden is constantly used as an interpretation of the Constitution. All that was decided there was with regard to a ferry between New York and New Jersey. But it is customary to regard that case not merely as dealing with whether or not a ferry line between New York and New Jersey is interstate commerce, but it is expressing certain principles of constitutional

power.

Mr. ELLENBOGEN. That is very true. But we are all advocates, and even when we become judges we are advocates; and when we determine upon a decision we are anxious to marshall all of the arguments that can be marshalled in its favor.

I made a study of that decision, and all that the Court decides in that case is that you cannot exclude from interstate commerce all of the goods of a mill because it happens to employ one child or more, without any relation to whether the particular goods whose shipment you are prohibiting were made by child labor or not. So there has never been a statute before the Court which limited itself properly. Mr. DORR. I think you have to give some effect in your committee to the language which the Court uses and the reasons for its decisions. This is your problem. I am not saying what you shall do. Mr. ELLENBOGEN. It is your problem as well as ours.

Mr. DORR. It is the problem of this committee, not mine.

Mr. ELLENBOGEN. I think it is your problem just as well as ours. I do not have the opinion before me, but there is one paragraph in the majority opinion, which indicates the Court was appalled by the fact that not only had the shipments of goods been prohibited which had been made by child labor but that the shipment of all goods made by that particular factory and, therefore, the statute in effect was a penal statute and not a statute for the purpose of prohibiting child labor.

Mr. DORR. I wonder if that is not in the second Child Labor case. Mr. ELLENBOGEN. No; the second Child Labor case is out. I have no argument on the unconstitutionality of that opinion because I thoroughly agree with the opinion of the Court in the tax case.

But

it is in that case there, and if I went through the majority opinion I could point out that paragraph. But you can see the distinction,

can you not?

Mr. DORR. I will say this, that the Court in its language as to the power of control of Congress does not limit itself to that possible distinction.

Mr. ELLENBOGEN. That is correct. But there is a paragraph in there where the Court refers to the sweeping circle which the statute takes in, which goes far outside the needs of a child-labor statute.

I did not want to interrupt you, Mr. Dorr, but just while you were on that point I thought it would be better.

Mr. DORR. Of course, no two cases have facts which are exactly the same. Very rarely is that true. But where the court is dealing with the question of power its language with regard to that power is entitled to consideration.

Mr. ELLENBOGEN. Yes. But, of course, we must not overlook the fact that it was a 5-to-4 decision.

Mr. DORR. Yes; and I pointed that out.

Mr. ELLENBOGEN. And another Court may seize upon the opportunity of having a different statute by distinguishing the new statute from this statute and sustaining it.

Mr. DORR. I was going to come to the question of whether there had been any indication by the Court since then of a departure from the fundamental principles which were laid down.

Mr. KELLER. I would like to ask one question, if I may.

Mr. DORR. Surely, Mr. Chairman.

Mr. KELLER. You refer to the fact of the general rule that the Court only decides the immediate case before it and the immediate points presented to it.

Mr. DORR. The Court can only decide the immediate case before it, but, in its recent decision, it expresses the view as to power which would apply to other cases which are not before it. And it is from those expressions and those principles which it lays down that I suppose we have to seek our guidance as to what the law is as to those other matters.

Mr. KELLER. Has the Court ever done the latter thing until the N. R. A.? I mean where they reached out and destroyed a whole act in deciding one point, when the whole act was not presented to them? Was there any case before that when that was done?

Mr. DORR. I think the Supreme Court customarily, in deciding particular facts before it, lays down principles with a breadth which would apply not merely to the particular and specific facts in that case but to broad principles, particularly where it is dealing with the existence and nonexistence of powers of Congress. Otherwise its opinions would not be very clear or very helpful. Of course, that is more or less a matter of opinion.

Mr. KELLER. In the N. R. A. case they reached over into other cases as well as making a very sweeping decision, whereas, if they had applied the rule strictly, which I understand has always been the rule of the Court, they would not have gone nearly to the extent

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