Mr. BESSE. As I understand the condition, I beg to disagree with you.

Mr. ELLENBOGEN. Why is it unethical to correct a complaint in accordance with the facts?

Mr. BESSE. It is not, as I said before, if the defendant receives due notification and due opportunity.

Mr. ELLENBOGEN. Provided he is given the additional opportunity in case of a substantial change?

Mr. BESSE. Then I have no objection. There is no indication that there is provision for that here.

NATIONAL ASSOCIATION OF WOOL MANUFACTURERS,
New York City, February 4, 1936.

Hon. KENT E. KELLER,
House of Representatives, Washington, D. C.

DEAR MR. KELLER: I am enclosing for your information a copy of a letter which I wrote today to Mr. Ellenbogen. Because of the positiveness and vehemence of Mr. Ellenbogen upon this subject when he was questioning me it seems to me appropriate that a copy of my letter should be included in the transcript of the hearing at the point where the transcript covers the discussion on the amendment of complaints.

Very sincerely yours,

ARTHUR BESSE. FEBRUARY 4, 1936.

Hon. HENRY ELLENBOGEN,

House of Representatives, Washington, D. C.

DEAR MR. ELLENBOGEN: I have secured legal advice upon the point which you raised at the hearing last Thursday in connection with the amending of a complaint. The language of your bill is as follows:

"Any such complaint may be amended by the member, agent, or agency conducting the hearing or the Commission at any time prior to the issuance of an order based thereon."

I am advised that in New York one amendment to a complaint is permitted as a matter of right, but that amendment must be made within 20 days of the service of the original complaint. Thereafter the allowance of any amendment is within the discretion of the court, an application being required on notice to the other side. No amendment to a complaint is permissible under court procedure after a hearing has been completed. The provision in your bill would permit an amendment after a he ring was completed and would, therefore, permit the issuance of an order which might vitally affect the rights of a defendant without any hearing whatever upon the specific charge.

I made no statement whatever that this procedure was contemplated, but merely stated that the language of the bill permitted it. I fail to see any respect in which the language of my brief was inaccurate or exaggerated. I regret exceedingly that my ignorance of the law did not permit me to properly clarify this point when I was appearing before your committee.

Very truly yours,

Mr. ELLENBOGEN. Then you should make that statement in the brief. And I could point to a multitude of other statements that are just as fallacious and just as false as this one.

Now, I would like to ask you this question. Does your association object to or does it believe in the principle of uniform minimum wages in your industry for unskilled labor?

Mr. BESSE. I think by far the majority of the industry would be in favor of uniform minimum wages.

Mr. ELLENBOGEN. Now, can you enforce and can you obtain such minimum wages, that is, such uniform minimum wages, without national legislation?

Mr. BESSE. That I cannot say. We have so far.

Mr. ELLENBOGEN. You have?

Mr. BESSE. Yes; we have.

Mr. ELLENBOGEN. You have uniform wages?
Mr. BESSE. Uniform minimum wages?

Mr. ELLENBOGEN. Yes; uniform minimum wages.
Mr. BESSE. Yes, sir.

Mr. ELLENBOGEN. In your industry?

Mr. BESSE. Yes, sir.

Mr. ELLENBOGEN. In the North and in the South?
Mr. BESSE. Yes, sir.

Mr. ELLENBOGEN. And in the various plants?

Mr. BESSE. Yes, sir.

Mr. ELLENBOGEN. And do you have uniform hours?

Mr. BESSE. Practically speaking. We have a few variations.
Mr. ELLENBOGEN. Were you here yesterday?

Mr. BESSE. I was not.

Mr. ELLENBOGEN. If you had been here, you would have heard a witness state that in the Gera Mills, in Passaic, N. J., women were forced to work as long as 10 hours and were forced to work during the night and on Sunday. Is that approved by your institute?

Mr. BESSE. It is not.

Mr. ELLENBOGEN. Is that a uniform standard of the institute? Mr. BESSE. It is not.

Mr. ELLENBOGEN. Does that instance not show that your institute is unable to enforce uniform standards?

Mr. BESSE. If that instance is correct, it shows in the instance that we did not enforce uniform standards.

Mr. ELLENBOGEN. As a matter of fact, do you have any power to enforce them?

Mr. BESSE. No legal power.

Mr. ELLENBOGEN. And your own experience has shown in the past that you cannot enforce them?

Mr. BESSE. Personally I think we have done a pretty good job. Mr. ELLENBOGEN. As a matter of fact, you would be violating the antitrust laws if you attempted to do that.

Mr. BESSE. There again I have to bow to your superior legal intelligence.

Mr. ELLENBOGEN. I just wanted to show you that an intelligent understanding of your own industry would bring the members of your association to the conviction that they cannot obtain the minimum standard of decency without national legislation. When you talk about ethics, let us talk about decency. In your brief you objected to the fee imposed for labels or stamps. You stated the commission may employ a number of employees more than it needs. You do not think that would be a very serious objection to the bill, do you? Mr. BESSE. Probably not.

Mr. ELLENBOGEN. I want to come back to the question of the three shifts. I believe you stated that it is the opinion of the majority of your members that the industry should operate on two shifts. Is that correct?

Mr. BESSE. That is correct. certain preparatory machinery.

There is a difference of opinion as to

Mr. ELLENBOGEN. If you operate on a three-shift basis, the machinery is better utilized and overhead is not to the same extent expended, and savings in operation are incurred? Is that correct? Mr. BESSE. Possibly.

Mr. ELLENBOGEN. Do you not believe that if savings are incurred which will reduce the cost of operation that they should be passed in part to the employees so that their purchasing power may be sustained and they may be placed in a position where they can buy the increased articles of industry?

Mr. BESSE. I would like to see wages increased, however you do it. Mr. ELLENBOGEN. That is exactly the purpose of the provision providing for 5 percent additional pay in case of a three-shift operation.

Mr. BESSE. I would prefer not to see the three shifts.

Mr. ELLENBOGEN. But if there is a three-shift operation-and at times it may be necessary, and expenses are thereby decreased— should not the employee also benefit by it, and not alone the stockholders?

I just wanted to point out to you that that provision is not a penalty but is a provision for the purpose of distributing on a wider basis the benefits which might come from a three-shift operation, whereas you jump to the hasty conclusion in your brief that that is a penalty.

What is the real objection of your association to this bill? I do not mean all of these details to which you object, but what is the main objection, if you will give us one or two points?

Mr. BESSE. I have been endeavoring to give you that for the last 2 hours. If I have not succeeded, I question if additional questions will make our particular position plainer to you.

Mr. ELLENBOGEN. If you would select one or two main objections what would they be?

Mr. BESSE. The one objection that I would select would be the fact that I do not believe that any Government commission or any private commission can properly set down the detailed methods of operation, work assignment, wages, and other conditions in the industry as varied as ours is, to say nothing of the other branches of the textile industry. Mr. ELLENBOGEN. In your brief you refer to arbitration on wages. Wouldn't you rather have a permanent commission which would acquire some experience in it than a temporary commission in each case? Mr. BESSE. The permanent Work Assignment Board suggested a continuing board to which disputes could be referred. But the proposal here to me seems to be to set definite assignments in the industry. I do not think that is practicable. I think the Board should hear two sides to the question and determine where the greater right lies, as to whether the man who thinks he is overloaded is more nearly correct than the man who thinks he is not.

Mr. ELLENBOGEN. If we should correct that, what is your next major objection?

Mr. BESSE. I think the objection I have made is sufficient.

Mr. ELLENBOGEN. Suppose we throw that out; would you accept the bill?

Mr. BESSE. Suppose you throw out my objection that I do not believe that the commission can supervise the textile industry? What have you left?

Mr. ELLENBOGEN. Suppose we have a law that provides for minimum wages, maximum hours, and similar safeguards.

Mr. BESSE. As an individual I have no objection to minimum wages or maximum hours, and I think the same is true of our industry. Mr. WOOD. Mr. Besse, I did not intend to interrogate you any more, but just a little while ago you said your industry was maintaining a uniform minimum wage and practically uniform maximum hours. Why did the textile industry and nearly every large industry in the Nation come to this Congress in 1933 and plead with Congress to enact some sort of legislation that would set up Government regulation of the industry? They invited us and pleaded with Congress to come in and adopt some legislation with restrictive powers that would eliminate the cutthroat, ruinous competition that was then rampant throughout the country. Why did they come here at that time and tell us that? If they were maintaining these beautiful and normal minima, why did they do it? It seems to me they did not have any minima at that time. They testified here that cutthroat competition was so rampant that nobody could maintain a minimum price, and that today he did not know why he would pay tomorrow because he did not know what his competitor was going to do. He wanted regulation then.

Mr. BESSE. There are two observations I would like to make. The conditions in 1932 were somewhat different than they are now. The second observation I make is that the possible change in viewpoint has something to do with unfortunate experiences under the legislation we got and which you state that some people asked for.

Mr. Wood. All right. What unfortunate experience did you have? Then I imagine the textile industry is in worse shape than it was in 1933? Is that true?

Mr. BESSE. Our own branch is in very much better condition. Mr. WOOD. Of course, you do not attribute that to the N. R. A. or anything that this Congress has done; you just think that naturally came about through a cycle?

Mr. BESSE. You are putting forth as mine an idea that I do not entertain. I think the N. R. A. was of considerable benefit to our industry.

Mr. Wood. I am taking it from your own evidence and drawing my conclusions from that.

Mr. BESSE. All I am prepared to say at this time is that we do not want another N. R. A. I think the N. R. A. did good to our industry. Mr. WOOD. Then why do you not want it, if it did good and saved your industry?

Mr. BESSE. In our industry the only sort of complaint that we had was lack of enforcement.

Mr. Wood. And what was the reason for the lack of enforcement. In fact, that was the fundamental reason for the failure of the N. R. A. to reach the object that it was intended to reach, because we left the regulation of the codes up to the employers themselves; and they showed that they were of the same frame of mind that they were in prior to 1933.

Mr. BESSE. We did not want that. We tried to get enforcement in Washington. We got no assistance whatsoever.

Mr. WOOD. You insisted upon it, certainly. The Manufacturers Association and the National Chamber of Commerce were both

very much wedded to that idea, and in their convention here of the National Manufacturers Association and the National Chamber of Commerce they passed a resolution asking the Congress to set up the tribunals where a majority of the industry could force the remainder of the industry to comply with the minimum standards.

Mr. BESSE. Yes; I think we embraced them with alacrity. The cotton textile industry had Code No. 1 and we had Code No. 3. Mr. Wood. And you wrote your own code without any interference by the employees or without any assistance at all.

Mr. BESSE. No; that is not right.

Mr. WOOD. So if the N. R. A. was in any way unsuccessful, or if the code was, it was due primarily to the employers having the absolute authority in the writing of the code.

Mr. BESSE. We had no authority whatever. That is one of the difficulties.

Mr. Wood. You wrote your own code and set up your own rules and regulations.

Mr. BESSE. That is not correct.

Mr. WOOD. That is correct; absolutely. Because who else did it? I would like to have you tell me that. If you did not write your own codes, who else did it?

Mr. BESSE. We did write our own codes. But we were told in what respect we could write our own codes and what provisions had to be in them.

Mr. WOOD. You practically policed it yourselves.

Mr. BESSE. We had to, because nobody else did it.

Mr. RAMSPECK. Mr. Besse, I have a conviction in my mind that about the only benefit that we got out of the N. R. A. came from the establishing of minimum wages, maximum hours, and the elimination of child labor, and the limitation on machine operation. What is your opinion about it?

Mr. BESSE. I think that covers the ground.

Mr. RAMSPECK. And those things with the possible exception of the limitation of machine hours, were in the President's Reemployment Agreement, were they not?

Mr. BESSE. In one form or another, yes.

Mr. RAMSPECK. All of those things that came afterward in the codes just created confusion and led to trouble and broke down the thing? Isn't that true?

Mr. BESSE. We had nothing in our code that was complicated or led to any particular difficulty.

Mr. RAMSPECK. What was it that changed your opinion about the N. R. A., then, if you had no difficulty with the code?

Mr. BESSE. I think the particular thing that caused the change in point of view is what I tried to point out to Mr. Wood, that I expressed in a different way. Perhaps we mistakingly understood when the N. R. A. was written that we could write our own code. And after we received the governmental approval we understood the Government would enforce it. It appeared to us later that what was going to happen was that we had to enforce a code that they wanted to write in the N. R. A. Board. We were constantly struggling against the imposition of general orders and particular orders affecting some provision of our code.