pleasure of misrepresenting the case or do you suppose they were impelled by the danger of reverting back to the condition of 1932? You surely do not contend that these 18 or 20 men that came here last week representing employees would come here and deliberately misrepresent the condition of their plants just for the pleasure of it. Do you not think they had some reason for coming here, and do you suppose they would be here at all if the cotton textile manufacturers were still abiding by the code? What occasion could they have for coming here? Mr. DORR. Mr. Wood, I would say this, if you will listen. The next witness is broadly familiar with that situation in a way that I am not, and I think that you will get perhaps a different picture of the situation, but just let me point out one fact which seems rather significant to me and it may not to you, and that is that the hourly rate of pay, as shown by the Bureau of Labor Statistics for the last month we have it, which, I think, is the month of December, November, or December, is higher than it was immediately after the code which would indicate that the evidence which you have heard does not represent conditions in the industry as a whole but represents conditions in some instances which happi y are sporadic and not prevailing. Mr. WOOD. Will you show me the report of the Department of Labor that has reported that wages have increased in the textile industry since July 1935, as compared with July 1934? Mr. DORR. What I said was that our average hourly rate Mr. WOOD (interposing). Since July 1, 1935, you do not have anything from the Department of Labor on that, do you? Mr. DORR. Pardon me, the next witness will give you something of that kind if you do not already have it. Mr. KELLER. Let us see if we cannot get through that. Are there any further question you care to ask, Mr. Wood? Mr. WOOD. No. Mr. ELLENBOGEN. I would like this witness to tell us if this is a genuine letter sent out by the Cotton Textile Institute (exhibiting letter to witness]. Mr. DORR. It appears to be. Mr. ELLENBOGEN. Just one more question. The processing taxhow soon after the manufacture was it due, on cotton? Mr. DORR. You mean after the opening of the cotton bale? Mr. DORR. Three months, that is between the opening of the bale, not the completion of the manufacture. The manufacturing process. is a long one, you see. Mr. ELLENBOGEN. Yes. Mr. DORR. And, it is 3 months after the bale of cotton is opened. Those taxes may be payable before those goods have been shipped at all. Mr. ELLENBOGEN. How long does it take you to make a return? Mr. DORR. To make a return? Mr. ELLENBOGEN. Yes. Mr. DORR. Well, returns have to be made in 30 days after the bale is opened. Mr. ELLENBOGEN. After the taxes due? Mr. DORR. After the end of the month during which the bale is opened. Mr. ELLENBOGEN. You have a total period of 4 months, do you not; 3 months and 1 month? Mr. DORR. If it is opened during the beginning of the month, I would say, yes. If it is opened at the end of the month, I would say, 3 months. Mr. ELLENBOGEN. When was the decision of the Circuit Court of Appeals handed down? Mr. DORR. July 16. Mr. ELLENBOGEN. Then, going back a period of 4 months, takes it back to February, February, or March, depending on the mill. July is the seventh month. Mr. DORR. That mill did not quit paying taxes simply on that basis, Mr. Ellenbogen. Mr. ELLENBOGEN. When that decision was handed down, the mills had not paid the tax subsequent to February. Mr. DORR. There was some additional time given. The law changed in August and extended the period. Mr. ELLENBOGEN. So that that period would go back even further? Mr. DORR. No, we had to pay more quickly prior to the amendments of last August. At that time, you extended the period Mr. ELLENBOGEN. There was some time prior to the decision of the Court during which the tax had not been paid at the time the decision was rendered. Mr. DORR. I did not quite get that. Mr. ELLENBOGEN. There was, or were some months prior to July, when the decision was handed down, that the processing tax had not been paid. Mr. DORR. There was a period of time. Mr. ELLENBOGEN. Now, for that period of time, the tax has never been paid. Mr. DORR. Some mills have not paid it. Mr. ELLENBOGEN. Some have but some have not. Mr. DQRR. The only way they would not have paid it, either they got an extension from the Treasury Department or an injunction. Mr. ELLENBOGEN. Yes. Now, as to those that got an injunction, and there are some, is that right? Mr. DORR. Yes. Mr. ELLENBOGEN. The 120-day contract would not go back that far. Mr. DORR. No, the 120-day contract-the decision of the Supreme Court not having come until January, would not go back that far. Mr. ELLENBOGEN. That is the period of time that the industry will have to do something about it because there is no disposition to permit the industry to retain that tax. Mr. DORR. It is the period of time which the industry is giving thought to, Mr. Ellenbogen, and I think you will find when you have to deal with this, that you will feel that the industry is disposed to take just as fair a position as they are going to ask you to. Mr. ELLENBOGEN. All right. Mr. WOOD. The next witness is Mr. Munroe. Mr. Munroe, it is the desire of the committee to dispose of this matter as promptly as possible and we would ask that you limit your time as much as you conveniently can. How much time do you think you will require? Mr. MUNROE. About an hour, Mr. Chairman. Mr. WOOD. I would like to have you reduce that to a half an hour if you possibly can, and in order to do that all the witnesses will have to reduce their time as much as possible, for this reason, that legislation is just as liable to come before the House this week that will make it impossible for this committee to hold hearings more than a couple of hours a day, in the morning. We went on last week morning and afternoon and I think the members of the committee ought to attempt to confine themselves and perhaps adopt a rule confining themselves for 10 minutes each, as we usually have done on former hearings, as far as interrogation is concerned, and if you can cut it down to 30 minutes I shall appreciate it. STATEMENT OF SYDNEY P. MUNROE, ASSISTANT TO THE PRESIDENT, THE COTTON TEXTILE INSTITUTE, INC. Mr. MUNROE. Mr. Chairman, I will do the best I can. I would like to have you bear in mind, though, that we had a number of witnesses here last week who wanted to be heard but could not stay. We expected to be able to go on Wednesday afternoon and did not get on until late Thursday afternoon. Mr. WOOD. I suppose the reason they could not be heard was that we took up too much time with each witness. We took one whole morning with one witness last week. Nothing can be accomplished by keeping one witness on all morning. I think better information can be adduced from these hearings by having three or four witnesses instead of one. Mr. MUNROE. Mr. Chairman, it is my desire to be just as helpful to this committee as I can, and I think I can be more helpful if I am a little explicit. At the outset, in order that you may have a reasonable idea of the background on which my statements are based, I am assistant to the president of the Cotton Textile Institute. I have been, all my business life, in the cotton-textile industry. Mr. WOOD. With the Cotton Textile Institute? Mr. MUNROE. No, sir. I am coming to that. I went to work in a cotton mill in 1912, for $10 a week, working, I believe, 58 hours a week, and for 8 years I was working in cotton mills in various positions, gradually improving them, and, finally, in 1920, I entered an engineering line, installing cost systems in cotton mills. For the first 5 years of that period I was located in New England, and in that time I had intimate access to all the figures, data, and finances of approximately 100 cotton mills. Five years subsequent to that I lived in Greeneville, S. C., and traveled from Alabama to Virginia, installing cost systems in some 65 cotton mills in the South. In 1930, 6 years ago, I entered the employ of the Cotton Textile Institute. Now, since I have been with the institute, I have been in charge of the field staff of the institute; at one time we had as many as seven men, and since then we have been reduced to four. Throughout the period of the N. R. A. code I was compliance director for the code authority. I had charge of our field agents who investigated wages, hours, and complaints. Prior to the N. R. A. code, at the time that we took, or rather undertook, to persuade mills to reduce their schedules to not over 55 hours a week, where many were running 60 and 66, I had charge in that case of the field staff promoting that program and had charge of keeping the records as to the conformancy with that program. When we subsequently undertook to persuade mills to eliminate the employment of women and minors at night, my field staff was the most active agency in promoting that campaign. I had charge of that effort in the field and kept the records on that matter. Since the code has elapsed, I have kept my field men at work practically all of the time visiting mills in all parts of the country, checking the extent to which mills are observing the minimum-wage and the maximum-hour provision of the former code and we have kept elaborate records along that line. Now, Mr. Chairman, I would like to take just a second to reimpress upon the minds of the committee two things regarding which there seems to be some uncertainty. There was, I thought, the belief that cotton mills undertook to have prices fixed under the Cotton Textile Code. I want to say, from my intimate contact with the code authority as compliance director, attending practically every code authority meeting and many of the conferences before the code was formed there was no effort made at price-fixing by cotton mills under the Cotton Textile Code. I would like also to say that there were members of our code authority, three Government representatives, including one labor representative, who was Dr. Leo Wohlman, one consumer representative and an impartial representative who was Gen. Hugh Johnson, Administrator of the N. R. A. In the statement of "Findings and policy" forming the preamble to H. R. 9072, introduced by Mr. Ellenbogen, it is proposed that the Congress of the United States "as a matter of legislative determination" find certain "facts" to be true, which so-called facts are thereafter set forth. It is reasonable to assume that the distinguished members of this committee and of the respective Houses of Congress will not desire to find as facts situations which are not susceptible of proof, which may consist only of half-truths or which, in point of fact, are at present nonexistent or have, perhaps, never existed. It is, perhaps, not unreasonable, also, to assume that the distinguished member of Congress introducing this bill, the party or parties who prepared its text, and the individuals or groups fostering the ideas and programs it contemplates, have diligently explored and canvassed the entire scope of reasons, arguments, or shall we say, excuses, which exhaustive mental effort might discover or imagine for the justification of such radical, revolutionary, and dictatorial proposals as this bill contemplates. If we may concede the ability of these various agencies to unearth all conceivable reasons and excuses for undertaking in this proposed legislation to deprive owners of cotton-mill properties of reasonable managerial authority over such enterprises and if the socalled facts adduced as reasons or excuses for such program can be shown to be relatively unimportant or, in fact, nonexistent, it may then be assumed that there is no sufficient reason or excuse for such legislation. Moreover, it would then become apparent that for this distinguished committee or for either House of Congress to find that such statements are "facts" would result in a departure from truth and integrity in legislative finding. It will be our undertaking in the present statement to examine the extent to which the elements of truth and integrity apply to these so-called facts. It is our assumption that, if these so-called facts can be shown to be nonexistent or relatively insignificant, the meticulous diligence with which this proposed legislation has been prepared precludes the possibility that other reasons or excuses can be presented as arguments for its enactment and that, therefore, lacking any substantial reason for enactment, the proposed act must, because of its insecure foundation, collapse. Mr. Chairman, I do not mean in what I have said to imply any belief in a lack of sincerity on the part of anybody in proposing this bill. I do not believe that there is any insincerity among the proponents of this bill, but I believe that the committee should bear this fact in mind; the bill was written last summer. It was proposed to the House last summer, or last August. The N. R. A. had elapsed legally on May 27. This bill was written, gentlemen, at a time when all of us, and I include myself, believed that there would be a collapse of wages-when we feared that there would be a breakdown in the hours of work. That is when this bill was written. Gentlemen, I believe that the effects since that time will show that that fear has not been substantiated. Let us examine the indictment of this entire industry, explore the records, and establish the facts. It is stated that in recent years commerce in textile products "has substantially declined in value and amount". This statement standing by itself and if true omits the important consideration of the relation which such decline, if any, bears to such a decline, if any, in other fields of commerce and industry as well as to the decline, if any, in the flow of commerce in the cotton textile industries of other textile producing countries. Now, gentlemen, I have here a tabulation which sets forth the facts as to those relationships. I refer now to a tabulation of the production index for all United States industries, which is derived from figures provided by the Federal Reserve Board. I have it here for 1926 to 1935. The figure in 1926 was 108. Yearly, the figures are as follows from that time forward. 1927, 106; 1928, 111; 1929, 119; 1930, 96; 1931, 81; 1932, 64; 1933, 76; 1934, 79; and 1935, 89. Now, let us look at the index of cotton processed for the years 1923 to 1935. In the year 1926 the index was 6,688,000 bales or 109. In 1927 it went up to 121. In 1928 it dropped to 107. In 1929 it went to 115, and then, in 1930 went to 88, and in 1931 to 89 and in 1932 to 82, and in 1933 it went up to 101, and then it dropped to 88 in 1934 and in 1935 there was a slight rise to 90. Mr. WOOD. That is production? Mr. MUNROE. That is cotton processed, Mr. Chairman. Mr. MUNROE. Cotton processed in the United States; yes. |