Mr. WOOD. You stagger it and divide the work, do you?

Mr. CONE. Yes, sir; that is, by cutting 1 day or 2 days off of the week.

Mr. ELLENBOGEN. What do you pay weavers?

Mr. CONE. I can tell you more about Greensboro than I can about Haw River. Are you going back to the main part of our mills at Greensboro?

Mr. ELLENBOGEN. Then, give us Greensboro.

Mr. CONE. Our best weavers earn $20 to $21.

Mr. ELLENBOGEN. Not the best weavers; but what is the average hourly wage for weavers? Is it piece work?

Mr. CONE. Yes, sir; it is.

Mr. ELLENBOGEN. How much do you pay them?

Mr. CONE. I do not have the records on that.

You see, sir, we

were making a lot of different fabrics. We have goods ranging all of the way from 40 picks up.

Mr. ELLENBOGEN. Then, you don't know?

Mr. CONE. I don't know the piece rate.

Mr. ELLENBOGEN. How many looms do your weavers operate?

Mr. CONE. Our weavers operate a maximum of 32 looms.

Mr. ELLENBOGEN. That is rather a big load, isn't it?

Mr. CONE. I think not.

Mr. WOOD. What do you call 100,000 picks? What is a pick? Mr. CONE. That is when the filling cloth goes across the loom one time. The cloth is made up of warp, which runs lengthwise, and filling, which crosses.

Mr. WOOD. Each strand crosses?

Mr. CONE. Yes, sir. Each time that the thread that goes crosswise of the cloth goes through the warp it is known as a pick.

Mr. WOOD. Do you have a speedometer or indicator which tells when you reach 100,000 picks?

Mr. CONE. Yes; we have on some of the looms.

Mr. ELLENBOGEN. Which is the operation where your weavers operate 32 looms?

Mr. CONE. That is the denim.

Mr. ELLENBOGEN. How many looms did that man operate in 1930, let us say?

Mr. CONE. I am not prepared to say as to that.

Mr. ELLENBOGEN. Would you say 16 looms?

Mr. CONE. Perhaps it was 16, or perhaps it was 14.

Mr. ELLENBOGEN. That is what they call the stretch-out, is it? Mr. CONE. That means that that weaver may be taking more looms out, but it does not necessarily follow that he is doing twice the amount of work, beacuse when I say that it is 32 looms to the weaver, the weaver has more help to run those 32 looms; he has more help than he had before.

Mr. KELLER. We thank you, Mr. Cone.

STATEMENT OF WILLIAM J. MATTHEWS, COUNSEL FOR THE NATIONAL ASSOCIATION OF FINISHERS OF TEXTILE FABRICS

Mr. MATTHEWs. Mr. Chairman, I think I can eliminate many of the matters that I intended to discuss, but I have a statement which I have prepared and which I will be very glad to present.

As regards coming back Monday, I will be very glad to do that. But I cannot do it this coming Monday. If the committee is going to be in session and if they want anything further from me than what I have in this statement, I will be very glad to agree upon any subsequent date to come back here.

Mr. KELLER. I think it would be very much better if you would return some day next week, for the reason that you will then be full of pep. And I like peppy witnesses.

Mr. MATTHEWs. Mr. Chairman, this statement, in opposition to this bill, is submitted on behalf of the members of the National Association of Finishers of Textile Fabrics who comprise a substantial numerical majority of all of the finishing plants in the United States. Altogether there are a few more than 100 finishing plants. The number of employees directly engaged in this finishing branch of the textile industry is in excess of 40,000.

Finishing, as such, consists principally of bleaching, dyeing, mercerizing, and printing textile fabrics. Most finishing plants merely finish the goods for others who own the goods and sell the finished fabrics. The job finishing plant neither buys nor sells the goods, but only renders the finishing service pursuant to instructions specified by the owner. These finishing plants are located almost entirely in the New England and Southeastern States.

This statement will be confined almost exclusively to its legal aspects, which necessarily involve the powers of Congress under the Federal Constitution.

The powers of Congress to enact legislation of this character may be briefly, and somewhat generally, enumerated, as follows:

(1) To collect, spend, or loan money; (2) to regulate commerce and prohibit shipments in interstate commerce; (3) to limit the use of the mails; (4) to regulate intrastate commerce which directly affects interstate commerce.

The declaration of policy purports to make certain findings of facts and the factual conclusions are used as a basis for justifying the constitutional validity of the regulatory provisions of the bill. These conclusions, as regards the existence of certain economic conditions, are further used for the purpose of differentiating court decisions, on the theory that decided cases, limiting the powers of Congress when dealing with matters involving these constitutional questions, are not applicable or controlling to the new conditions recited in the bill. These findings state, among other things, the following:

That the production and distribution of textile fabrics are affected with a national public interest. In other words, under the conditions set forth, the making and distributing of textile fabrics is in the same class as a railroad or utility company and, therefore, subject to regulation by the Federal Government. That the manufacture, sale, transportation, and distribution of these goods between and among the States is a part of a continuous stream or current of commerce. Consequently, all is a part of interstate commerce. The phrase "continuous stream or current of commerce" was used in two decisions of the Supreme Court and is here featured to enlarge the scope of the commerce clause of the Constitution. Further comment with reference to that particular phrase and those cases will be made presently.

Also, because of excessive and unfair competition with reference to wage rates and labor costs, and other conditions of employment,

denial of the rights of employees to organize and bargain collectively, there has resulted, throughout the textile industry, destructive conditions and severe price instability.

In order to prevent the evils claimed to exist in the industry, and in order to compel observance of the provisions of the act, it is the declared policy of Congress, through this bill, to deny the use of the channels of interstate commerce and to deny the use of the mails, the benefits of Government purchases, contracts, loans, grants, and the privilege of registration of securities to any person producing textile products under the conditions described in the declaration of policy or contrary to the standards set forth in the act.

Obviously, the statements of fact, or conclusions contained in the findings of policy are not conclusive and binding upon the courts. Naturally, they may be taken into consideration in determining the real intent of the act, but in an actual case the Court will be called upon to determine whether the enforcement of the act will deprive one of his rights guaranteed by the Constitution. In doing so, necessarily the Court will determine whether the facts in the particular instance are reconcilable, or in conflict, with those recited in the declaration of policy. Such questions are always open for the determination of the Court; otherwise, there would be practically no limitations to the subjects upon which Congress might legislate. For example, because juries might, in certain instances, acquit one charged with a crime, Congress may declare, as a national policy, that it would conduce to the prevention of crime to abolish the right of trial by a jury.

Even so, the recitals in the findings of policy of the bill present nothing basically new or novel and have been invalidated by an uninterrupted continuous stream and current of decisions. Except the proposed bill, as regards the means declared to be the policy of Congress to use in compelling observance, shows more clearly upon the face of the bill the extra-legal purposes intended and, under the authorities, when such illegal purposes appear upon the face of the bill, the courts always inquire into the motives whlch prompted the legislation.

Power to raise and spend money. This phase of the bill needs little comment. Unquestionably, Congress has power to levy taxes for revenue purposes. Possibly this taxing power could be exerted through an appropriate charge for labels and stamps, and use the money for defraying the expenses of administering the bill. The charge for the labels is not called an excise tax, or any other kind of a tax, but is designated as a fee for the labels or stamps.

In the recent decisions of the Supreme Court (Hoosac Mills and Rice Millers cases), the processing tax was not regarded as a true tax and, in one instance, was referred to as an "exaction." The decision of the Supreme Court in the Hoosac Mills case makes it perfectly clear that money cannot be either collected nor spent by the Government for the purpose of controlling or regulating matters beyond the jurisdiction of the Federal Government. Consequently, any of the provisions of the bill relating to the collection and spending by the Government of money, including the requirements for the purchase of labels or stamps, depend for the validity upon the purposes for which such money is collected and used. As stated in the Hoosac Mills decision, the collection of the claimed tax and the pay

ment of the money to producers pursuant to rental and benefit contracts could not be treated separately.

Regulation of commerce and prohibition of shipments in interstate commerce. The constitutional source of Federal power for the enactment of this bill, if any, must be found in the commerce clause of the Constitution and, along with that the Federal power over the mails. The constitutionality of the act, if it could be sustained at all, must be on the theory that this bill is an exercise of the power of Congress to close the mails and the channels of interstate commerce to transactions inherently harmful, or that the manufacturing and distribution of textile fabrics are inseparable and both constitute a part of interstate commerce, or that such manufacturing and distribution so directly affect interstate commerce as to be a part of it, and, hence, within the congressional power to regulate.

Since this bill provides for the denial of the use of the channels of interstate commerce and the use of the mails, brief reference should be made to these specific phases. Federal statutes have been sustained which exclude from interstate commerce lottery tickets, impure food, liquor in contravention of State laws, misbranded articles of food, stolen automobiles and diseased cattle. (Lottery case, 188 U. S. 321; Hipolite Egg Co. v. U. S., 220 U. S. 45; Clark Distil ing Co. v. West Maryland Ry., 242 U. S. 311; Weeks v. United States, 245 U. S. 618; Brooks v. United States, 267 U. S. 432; Reid v. Colorado, 187 U. S. 137; Thorton v. United States, 271 U. S. 414). The power of exclusion of all those cases arouse under very general power in Congress to exclude matter from interstate commerce because of the inherently harmful or dangerous character of the particular subjects. excluded.

As regards commodities and transactions not inherently harmful, Congress has no general power to close the channels of interstate

commerce.

Such a point has been presented but once to the Supreme Court, namely, in the Child Labor case (Hammer v. Dagenheart, 247 U. S. 251). The exclusion from interstate commerce of goods produced in factories employing child labor was there held unconstitutional. The courts said that the congressional power to regulate commerce did not include power to exclude from commerce harmless goods. As the Court further said-the power to regulate commerce is the power to control the means for carrying on commerce, which is directly contrary to the assumed right to forbid commerce from moving and thus destroy it as to particular commodities. The difference between a Federal statute closing the channels of interstate commerce to stolen automobiles and one prohibiting shipments of goods made in a factory where child labor is employed is real and apparent. To interpret the commerce clause in such a way that Congress can prescribe conditions of manufacture, as was attempted in the Child Labor case, would involve, as has been stated frequently by the Supreme Court a complete surrender of States' rights, which is a very different matter from empowering Congress to prosecute the theft of automobiles. The one wou d compel States to adopt a social welfare policy; the other would merely assist the States in the suppression of crime. In short, the regulating of conditions of employment in a factory, through a Federal law, would violate the tenth amendment to the Federal Constitution, whereas the automobile theft case

would not. In any event, it is settled doctrine that Congress has no power to close the channels of interstate commerce to transactions that are inherently harmless, and by such means forced Federal regulation on a field beyond its control.

The power to regulate foreign commerce and the power to regulate interstate commerce were delegated to the Congress in the same sentence of the Constitution and the word "regulate" was used but once. The Court has held that the word "regulate" gives Congress the power to destroy commerce with foreign nations by prohibiting the importation of any articles, however harmless, and it may even condition the importation upon compliance with Federal regulation (Buttfield v. Stranahan, 192 U. S. 470, 492-493). However, even this point has been cleared up by the Court on the ground that the power of Congress over interstate commerce is subject to certain constitutional limitations which do not apply to foreign commerce. The Court has said that no individual has any vested right to trade with foreign nations; hence, the power of the Congress over foreign commerce is not limited by the due process requirements of the fifth amendment (Buttfield v. Stranahan, supra). But as to interstate commerce, the fifth amendment is squarely applicable (Carroll v. Insurance Company, 149 U. S. 401). In that case, Justice Holmes said:

It is true that by the provision in the body of the instrument (Constitution), Congress has attempted to regulate commerce, and that the act of Congress referred to in the cases cited was passed in pursuance to that power. But even if the fifth amendment (which prevents the taking of property without due process of law) were read as contemporaneous with the original Constitution, the power given in the commerce clause would not be taken to override it so far as the fifth amendment protects fundamental personal rights.

Also, the tenth amendment reserves to the States powers not specifically granted to the Federal Government, and this amendment is even far more applicable to Congress' power over interstate commerce than over foreign commerce.

In view of these decisions, the law becomes very clear and it perhaps would have been more accurate for the Court, in the Child Labor case, to have amplified to the extent of saying that the delegated power to regulate interstate commerce gives the Congress sovereign power over such commerce, but that power is limited by the Bill of Rights; that the Congress may not close the channels of interstate commerce to inherently harmless matter, because, to do so, would be confiscatory-hence violative of the due process provision of the fifth amendment, and, in addition, would give the Congress power, by indirection, to regulate purely intrastate activities in violation of the tenth amendment.

It has been stated frequently in the decisions that because of the very complexity of business, as adequately amplified in the findings of policy of this bill, although the findings of policy do not include many other factors which might reasonably contribute to the conditions complained of, under such comprehensive powers, under the commerce clause, Congress could arbitrarily exclude harmless matter from interstate commerce unless Federal regulations were observed, and the result would be, as made so very clear in all of the Court decisions, including the recent Schecter decision, could control practically every feature of intrastate business life. Such comprehensive