i\ ^ Ol0imitsst0«]il erord PROCEEDINGS AND DEBATES » OF THE SECOND SESSION OF THE SEVENTY- THIRD CONGRESS OF THE UNITED STATES OF AMERICA Volume 78-Part 1 JANUARY 8, 1934, TO JANUARY 22, 1934 (Pages 1 to 1126) r> 31ATE CX)LLi:';^ :^K UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON : 1934 y ( . 'n ^■> f \J_. J' 0l0njr^Hsi0Ml SEVENTY-THIRD CONGRESS, SECOND SESSION SENATE Wednesday, January 3, 1934 The 3d day of January being the day prescribed by the Constitution of the United States, as amended by the twentieth amendment, proclaimed February 6. 1933. for the annual meeting of Congress, the second session of the Seventy-third Congress commenced this day. The Senate assembled in its Chamber at the Capitol. John N. Garner, of Texas. Vice President of the Umted States, called the Senate to order at 12 o'clock meridian. The Chaplain. Rev. ZPBarney T. Phillips, D.D., of the city of Washington, offered the following PRAYER God of our fathers. Fountain of light and love, before whose boundless gaze the seasons roll in majesty and might, and man. Thy miniature divine, was made to walk the earth in joy; incline, at this momentous hour of the new-born year, our thoughts to prayer, our lips to praise. ManUe our Nation with Thy wings of lOve; may virtue be her path to glory, liberty in righteousness her crown of pride. May our President. Vice President, the Members of the Congress, and all to whom has been committed the authority of governance, be graced with wisdom that is Thine, and do Thou, through this tangled maze of life, direct their ways, keeping them unspotted from the world, that truth and justice in our ;nidst may be enthroned and goodness shrined in every heart. Blot out the sins of yesteryear, lighten the burdens of all who are oppressed, pluck from affliction's breast the poignant shaft, and wreathe each cup of woe with smiles reflected from Thy face, till on each brow the seal of God is set and all mankind shall own Thee King of kings. Amen. CALL OF THK ROLL The VICE PRESIDENT. The Senate Is now in session. The clerk will call the roll. The legislative clerk (Emery L. Prazler) called the roll, and the following Senators answered to their names: Adams Ashurst Austin Bachman Bailey Bankbead Barbour Barkley Black Bone Borah Brown Bulkley Bulow Byrd Byrnes Capper Caraway Carey Clark Connally Coolldge Copeland Costigan Couzens Cutting Davis Dickinson Dleterlch DUl Duffy Erlckson Fess Fletcher Prazler George Olaas Goldsborough Gore Hale Barrlflon Hastings Hayden Hebert Johnson Kean Keyea King La Follette Lewis Logan Lonergan Long McAdoo McCarran McGlll McKellar UcNary Murphy Neely Norrls Nye Overton Patterson Pittman Pope Reed Reynolds Robinson. Ark. Robinson. Ind. Russell Sheppard Shlpstead Smith Stelwer Thomas, Okla. Thomas. Utah Thompson Townsend Trammell Tydings Vandenberg Van Nuys Wagner Walcott Walsh Wheeler White Mr. HEBERT. I desire to announce that my colleague the senior Senator from Rhode Island [Mr. Metcalf] and also the Senator from West Virginia [Mr. Hatfield], the Senator from Minneisota [Mr. SchallI, and the Senator from South Dakota [Mr. NorbkckJ are necessarily absent from the Senate. Mr. LEWIS. I wish to announce the enforced absence of the Senator from Mississippi [Mr. Stephens]. The VICE PRESIDENT. Eighty-eight Senators have an- swered to their names. A quorum is present. DEATH OF SENATOR PORTER H. DALE Mr. AUSTIN. Mr. President, with deep regret I announce the death, since the Congress last adjourned, of my late coUeague, Hon. Porter H. Dale, a Senator from the State of Vermont. ^. ^ , j i. I offer the resolutions which I send to the desk and asK unanimous consent for their immediate consideration and adoption. The VICE PRESIDENT. The resolutions will be read. The resolutions (S.Res. 104) were read, considered by unanimous consent, and unanimously agreed to. as follows: Resolved, That the Senate has heard with deep regret and pro- found sorrow the announcement of the death of Hon. Portik h, Dali late a Senator from the State of Vermont. Resolved, That the Secretary communicate these reaolutiona to the House of Representatives and transmit a copy thereof to the family of the deceased. DEATH OF SENATOR JOHN B. KEKDRICK Mr. CAREY. Mr. President, it becomes my sad duty to announce the death, since the last meeting of the Senate, of my late colleague. Hon. John B. Kekdrick. At this time I send to the desk appropriate resolutions and ask unanimous consent for their immediate consideration. The VICE PRESIDENT. The resolutions will be read. The resolutions (SJaes. 105) were read, considered by unanimous consent, and unanimously agreed to, as follows: Resolved, That the Senate has heard with deep regret and pro- found sorrovF the announcement of the death of Hon. John B. Kkndrick late a Senator from the State of Wyoming. Resolved That the Secretary communicate these resolutions to the House of Representatives and tfansmit a copy thereof to the family of the deceased. RESIGNATION OF SENATOR SAM G. BRATTON, OF NEW MEXICO ■me VICE PRESIDENT. The Chair lays before the Sen- ate a communication, which will be read. The Chief Clerk (John C. Crockett) read as follows: ALBT7QXJHIQUB. N.Msx.V«^ 25, 1933. Hon. John N. Gamteh. Vice President, Senate Office Building, » Washington, D.C. Dear Mr. Vice President: In order that the records of the Sen- ate may be complete, this will advise you that, under date of the 24th instant. I wrote Hon. Arthur Sellgman. Governor of New " I hereby tender you my resignation as United States Senator, effective on this date." _^ r -.^ With renewed good wishes and kind personal regards. I am. Sincerely yours, « «_ Sam O. Bkattow. The VICE PRESIDENT. The communication will lie on the table. SENATORS FROM VIRGINIA, HEW MEXICO, VERMONT, AND WYOMIHC Mr. GLASS. Mr. President, I jnresent the credentials of my colleague, Hon. Harry P. Bym, elected a Senator from the State of Virginia to flU an unexpired t«rm. I ask that the credentials may be read, and that at the appropriate time my coUeague may take the oath of office. The VICE PRESIDENT. The credentials wiD be read. The legislative clerk read as follows : Commonwealth of Vnuama. To the Presidbnt or the Sekate or the Uwt™ ^^f^ioM n.— «- This is to certify that on the 7th day of November ISW Hamt Fu»o Btrd waa duly chosen by the qualified electors at the Com- 3 congressional! RECORD— SENATE January 3 monwealth of Virginia a Senator from said Commonwealth to fll the vacancy In the term ending January 3. 1935, caused by th resl(?nation of Claude A. Swanson. Witness: His excellency our Governor. John Garland Pollardl and our seal hereto affljted at Richmond. Va., this 27th day o^ November, AJ3. 1983. Jno. Garland Pollabd, i Governor of Virginia. By the Governor: (seal] Piter SAnNDERS. Secretary Qf the Commonwealth, i The VICE PRESIDENT. The credentials will be placecj on file. i Mr. CUTTING. Mr. President, I present the credential^ of Hon. Carl A. Hatch, who has been appointed by the Gov-* ernor of the State of New Mexico to fill the vacancy caused by the resignation of Hon. Sam G. Bratton. I ask that the credentials may be read, and later I shall ask that Mr, Hatch may take the oath of office. The VICE PRESIDENT. The Secretary will read the credentials. The legislative clerk read as follows: State of New Mexico, Executive Department To the President op the Senate of the United States: This l£ to certify that on the 10th day of October, AD. 1933, Carl A. Hatch, of Clovis, N.Mex., wns duly appointed by me a Senator from said State In the Senate of the United States from the date of his said appointment until the people of New Mexi':-o shall elect his successor and until his successor so elected shall have qualified for the office according to law Witness: His Excellency our Governor. A W. Hockenhull, and our seal hereto affixed this 10th day of October. AD. 1933. A. W. Hockenhull. - By the Governor: I seal] Mrs. Marci'E^ite P. Baca. Secretary of State. The VICE PRESIDENT. The credentials will be placed on file. Mr. AUSTIN. Mr. President, I present the credentials of Hon. Ernest W. Gibson, who has been appointed by the Governor of the State of Vermont to fill the vacancy caused by the death of Hon. Porter H. Dale. I ask that the creden- tials be read. Mr. Gibson i^ present, and at the appropriate time I will ask that the oath of office may be administered to him. The VICE PRESIDENT. The credentials will be read. The legislative clerk read as follows: State of Vermont To the President of the Senate of the United States : This is 'to certify that pursuant to the power vested In me by the Constitution of the United States and the laws of the State of Vermont. I, Stanley C. Wilson, the Governor of said State, do hereby appoint Ernest W. Gibson, of Brattlebcro. a Senator from Fal4 State to represent said State In the Senate of the United States until the vacancy therein, caused by the death of Porter H. Dal^. Is fllled by election, as provided by law fitness: His ExceUency our Governor, SUnley C. Wilson, and our seal hereto alBxed at Montpelier this 21st day of November AX>. 1883. Stanley C. Wilson. ~ .^ - CrouernoT. By the Governor: ISBALl RaWSON C. MtRICK. Secretary of State The VICE PRESIDENT jjn file. ^ Mr. CAREY. Mr. President. I present the credentials of Hon. Joseph C. 0*Mahoney. who has been appointed by the Governor of the State of Wyoming to fill the vacancy caused by the death of Hon. John B. Kendrick. I ask that the credentials may be read and that Mr. O'Mahoney may take the oath of office at the proper time. The VICE PRESIDENT. The credentials will be read. The legislative clerk read as follows : The State of Wtoming. Executive Department, Cheyenne. December 18, 1933. To the President of the Senate of the United States: This is to certify that pursuant to the power vested In me by the Constitution of the United States and the laws of the State of Wyoming. I. Leslie A. Miller, the Governor of said State do hereby appoint Joseph C. OMahonet a Senator from said State to represent said State in the S nat? of the United States until the vacancy therein, caixsed by the death at Hon. John B Kendrick Is lilied by electicm. as provided by law. The credentials will be placed Witness: His Excellency our Governor. Leslie A. Miller, and our seal hereto affixed at Cheyenne, Wyo., this 18th day of December, AJ3. 1933. Leslie A. Miller, Governor. By the Governor: I seal I M. Clark. Secretary of State. The VICE PRESIDENT. The credentials will be placed on file. If the Senator-elect and the Senators-designate will pre- sent themselves at the Vice President's desk, the oath of office will be administered to them. Mr. Byrd, escorted by Mr. Glass; Mr. Hatch, escorted by Mr. Cutting; Mr. Gibson, escorted by Mr. Austin; and Mr. 0*Mahoney. escorted by Mr. Carey, advanced to the Vice President's desk: and the oath of office having been admin- istered to them, they took their seats in the Senate. LIST OF senators BY STATES * Alabama. — Hugo L. Black and John H. Bankhead. Arizona. — Henry F. Ashurst and Carl Hayden. Arkansas. — Joseph T. Robinson and Mrs. Hattie W. Cara- way. California. — Hiram W. Johnson and William Gibbs Mc- Adoo. Colorado. — Edward P. Costigan and Alva B. Adams. Connecticut. — Frederic C. Walcott and Augustine Lon- ergan. Delaware. — Daniel O. Hastings and John G. Townsend, Jr. Florida. — Duncan U. Fletcher and Park Trammell. Georgia. — Walter P. George and Richard B. Russell, Jr. Idaho. — William E. Borah and James P. Pope. Illinois. — J. Hamilton Lewis and William H. Dieterich. Indiana. — Arthur R. Robinson and Frederick Van Nuys. Iowa. — L. J. Dickinson and Louis Murphy. Kansas. — Arthur Capper and George McGill. Kentucky. — Alben W. Barkley and M. M. Logan. Louisiana. — Hucy P. Long and John H. Overton. Maine. — Frederick Hale and Wallace H. White, Jr. Maryland. — Millard E. Tydings and Phillips Lee Golds- borough. Massachusetts. — David I. Walsh and Marcus A. Coolidge. Michigan. — James Couzens and Arthur H. Vandenberg. Minnesota. — Henrik Shipstead and Thomas D. Schall. Mississippi. — Pat Harrison and Hubert D. Stephens. Missouri. — Roscoe C. Patterson and Bennett Champ Clark, Montana. — Burton K. Wheeler and John E. Erickson. Nebraska. — George W. Norris and William H. Thompson. Nevada. — Key Pittman and Patrick McCarran. New Hampshire. — Henry W. Keyes and Fred H. Brown. New Jersey. — Hamilton F. Kean and W. Warren Barbour. New Mexico. — Bronson Cutting and Carl A. Hatch. New York. — Royal S. Copeland and Robert F. Wagner. North Carolina. — Josiah William Bailey and Robert R. Reynolds. North Dakota. — Lynn J. Frazier and Gerald P. Nye. Ohio. — Simeon D. Fess and Robert J. Bulkley. Oklahoma. — Elmer Thomas and Thomas P. Gore. Oregon. — Charles L. McNary and Frederick Steiwer. Pennsylvania. — David A. Reed and James J. Davis. Rhode Island. — Jesse H. Metcalf and Felix Hebert. South Carolina. — Ellison D. Smith and James F. Byrnes. South Dakota. — Peter Norbeck and W. J. Bulow. Tennessee.— Kenneth McKellar and Nathan L. Bachm.an. Texas. — Morris Sheppard and Tom Connally. t/fa/i.— William H. King and Elbert D. Thomas. Vermont. — Warren R. Austin and Ernest W. Gibson. Virginia. — Carter Glass and Harry Flood B>Td. Washington.— C. C. Dill and Homer T. Bone. West Virginia.— Hem-y D. Hatfield and M. M. Neely. Wisconsin.— Robert M. La Follette. Jr., and F. Ryan Duffy. Wyoming. — Robert D. Carey and Joseph C. O'Mahoney. NOTIFICATION TO THE PRESIDENT Mr. ROBINSON of Arkansas submitted the following reso- lution (S.Res. 106>, which was r»ad, consl«!tered by unani- mous consent, and agreed to: ." Vl i-t/AXTr^T^TTiocirrvXT AT l>J?nr\Vfri QTTMATT?. Jamttat?v ^ 1934 CONGRESSIONAL RECORD—SENATE Resolved, That a committee constating of two Senator? be ap- pointed to join siich conunlttee as may be appointed by the House of Reprci^ntatlves to wait upon the President of the United States and Inform him that a quonim of each House Is assembled and that the Congress Is ready to receive any communication he may be pleased^to naake. The VICE PRESIDENT appointed Mr. Robinson of Ar- kansas and Mr. McNary the committee on the part of the Senate. * NOnnCATION TO THE HO0SB Mr. McNARY submitted the following resolution fSJles. 107) , which was read, considered by unanimous consent, and agreed to: Resolved, That the Secretary Inform the Hoxise of Representa- tives that a quorum of the Senate Is assembled and that the Senate Is ready to proceed to business. HOUR OF DAILY MEETING Mr. FLETCHER submitted the following resolution (S.Res. 108 ) , which was read, considered by unanimous consent, and agreed to: Resolved. That the hour of dally meeting of the Senate be 12 o'clock meridian unless otherwise ordered. RECESS Mr. ROBINSON of Arkansas. I move that the Senate stand in recess subject to the call of the Vice President. The motion was agreed to; and (at 12 o'clock and 18 min- utes p.m.) the Senate took a recess subject to the call of the Vice President. At 12 o'clock and 50 minutes p.m., the Vice President being in the chair, the Senate reassembled. CALL OF THE ROLL Mr. ROBINSON of Arkansas. I suggest, the absence of a quorum. The VICE PRESIDENT. The clerk will call the roll. The Chief Clerk called the roll, and the following Senators answered to their names: Adams Costlgan Johnson Reed ARhurst Couzens Kean Reynolds Austin Cutting Keyes Robinson, Ark Bschman Davis King Robinson. Ind BaUey Dickinson La FoUette Russell Bankhead Dleterich Lewis Sheppard Barbour Dill Logan Shipstead Barkley Duffy Lonergan Smith Black Erlckson Long Stelwer Bone Pess McAdoo Thomas, Okla. Borah Fletcher McCarran Thomas. Utah Brown Frazler McOill Thompson Bulkley George McKellar Townsend Bulow Gibson McNary Trammell Byrd Glass Murphy Tydings Byrnes Ooldsborough Neely Vandenberg Capper Gore Norrls Van Nuys Caraway Hale Nye Wagner Carey Harrison 0'Mahoney^ Walcott Clark Hastings Overton Walsh Connally Hatch Patterson Wheeler CooUdge Hayden Plttman White Copeland Hebert Pope The VICE PRESIDENT. Ninety -one Senators having an- swered to their names, a quorum is present. MESSAGE FROM THE HOUSE A message from the House of Representatives, by Mr. Haltigan, one of its clerks, informed the Senate that a com- mittee of three Members had been appointed by the Speaker on the part of the House of Representatives to join with the committee on the part of the Senate to notify the President of the United States that a quorum of each iHouse had assembled and that Congress was ready to receive any com- munication that he might be pleased to make, and that the Speaker had appointed Mr. Byrns, Mr. Doughton, and Mr. Snell the members of the committee on the part of the House of Representatives. The message also informed the Senate that a quorum of the House had appeared and that the House was ready to proceed with business. The message announced that the House had agreed to a concurrent resolution (H.Con.Res. 25) providing that the two Houses of Congress assemble in the Hall of the House of Representatives on Wednesday, the 3d day of January, 1934, at 1:30 o'clock in the afternoon, for the purpose of re- ceiving such communications as the President of the United States shall be pleased to make to them, in which it re- quested the concurrence of the Senate. NOTIFICATION TO THE PRESIDENT Mr. ROBINSON of Arkansas and Mr. McNARY advanced in the center aisle, and Mr. ROBINSON of Arkansas said: Mr. President, the joint conmiittee appointed by the Senate and the House of Rep- resentatives to notify the President that the two Houses are in session, are organized, and are ready to receive any com- munication he may desire to make, have performed that duty, and beg to report that the President will proceed to the Hall of the House of Representatives and there submit in person his annual message to the two Houses at 1:30 o'clock today. DEATH OF FORMER SENATOR JOHNSON OF SOUTH BAKOTA Mr. BULOW. Mr. President. I deem it my duty, in line with other announcements made today, to advise the Sen- ate of the death of the Honorable Edwin S. Johnson, at Platte, S.Dak., on July 19, 1933. It will be recalled that Mr. Johnson served in this body as a Senator from the State of Skjuth Dakota for the term which began on March 4, 1915, and expired on March 3, 1921. JOINT MEETING OF THE TWO HOUSES Mr. ROBINSON ^f Arkansas. I move that the Senate proceed to the consideration of the ctmcurrent resolution just received from the House of Representatives. The VICE PRESIDENT. Tbe Chair lays before the Sen- ate a concurrent resolution coming over from the House of Representatives. The concurrent resolution (H.ConJles. 25) was read, con- sidered by unanimous consent, and agreed to, as follows: Resolved hy the House of Representatives (the Senate concur- ring). That the two Houses of CongresB assemble In th« Hall ot the House of Representatives on Wednesday, the 3d day of Janu- ary, 1934, at 1:30 o'clock In the afternoon, for the purpose of receiving such communications as the President of the United ' States shall be pleased to make to them. RECESS Mr. ROBINSON of Arkansas. Mr. President, I desire to announce that it is expected that Senators will remain about the Chamber, and at 20 minutes past 1 o'clock will form in procession and proceed to the Hall of the House of Representatives. I now move that the Senate stand in recess subject to the call of the Vice President. The motion was agreed to; and (at 1 o'clock pjn.) the Senate took a recess subject to the call of the Vice President. At 1 o'clock and 20 minutes pjn. the Senate reassembled. JOINT MEETING OF THE TWO HOUSES The VICE PRESIDENT. The Senate will now proceed to the Hall of the House of Representatives for the Joint ses- sion with the House to receive a message from the President of the United States. The Senate, preceded by the Sergeant at Arms, the Vice President, and the Secretary, proceeded to the Hall of the House of Representatives. ADDRESS BY THE PRESIDENT OF THE UNITED STATES The address of the President of the United States, this day delivered at a joint meeting of tbe two Houses of Con- gress, is as follows: The PRESIDENT. Mr. President, Mr. Speaker, Senators, and Representatives in Congress, I come before you at the opening of the regular session of the Seventy -third Congress not to make requests for special or detailed items of legisla- tion; I come, rather, to counsel with you. who, like myself, have been selected to carry out a mandate of tbe whole people, in order that without partisanship you and I may cooperate to continue the restoration of our national well- being and, equally important, to build on the ruins of the past a new structure designed better to meet tbe present problems of modem civilization. CONGRESSIONAL RECORD— SENATE January 3 ^ Such a structure includes not only the relations of in- dustry and agriculture and finance to each other but also the effect which all of these three have on our individual citizens and on the whole people as a nation. Now that we are definitely in the process of recovery, lines have been rightly drawn between those to whom this recovery means a return to old methods — and the number of these people is small— and those for whom recovery means a reform of many old methods, a permanent readjust- ment of many of our ways of thinking, and. therefore, of many of our social and economic arrangements. Civilization cannot go back: civilization must not stand still. We have undertaken new methods. It is our task to perfect, to improve, to alter when necessary, but in all cases to go forward. To consolidate what we are doing, to make our economic and social structure capable of dealing with modern life, is the joint task of the legislative, the judicial, and the executive branches of the National Government. Without regard to party, the overwhelming majority of our people seek a greater opportunity for humanity to pros- per and find happiness. They recognize that human welfare has not increased, and does not increase, through mere mate- riahsra and luxury, but that it does progress through integ- rity, unselfishness, responsibility, and justice. In the past few months, as a result of our action, we have demanded of many citizens that they surrender certain licenses to do as they please in their business relationships; but we have asked this in exchange for the jirotection which the state can give against exploitation by their fellow men or by combinations of their fellow men. • I congratulate this Congress upon the courage, the ear- nestness, and the efl5ciency with which you met the crisis at the special session. It was your fine understanding of the national problem that furnished the example which the country has so splendidly followed. I venture to say that the task confronting the First Congress of 1789 was no greater than your own. I shall not attempt to set forth either the many phases of the crisis which we experienced last March nor the many measures which you and I undertook during the special ses- sion that we might initiate recovery and reform. It is suflBcient that I should speak in broad terms of the results of our common counsel. The credit of the Government has been fortified by drastic reduction in the cost of its permanent agencies through the Economy Act. With the twofold purpose of strengthening the whole financial structure and of arriving eventually at a medium of exchange which will have over the years less variable purchasing and debt-paying power for our people than that of the past, I have used the authority granted me to pur- chase all American-produced gold and silver and to buy additional gold in the world markets. Careful investigation and constant study prove that in the matter of foreign-ex- change rates certain of our sister nations find themselves so handicapped by internal and other conditions that they feel unable at this time to enter into stabilization discussions based on permanent and world-wide objectives. The overwhelming majority of the banks, both national and State, which reopened last spring are in sound condi- tion and have been brought within the protection of Federal insurance. In the case of those banks which were not per- mitted to reopen, nearly $600,000,000 of frozen deposits are being restored to the depositors through the assistance of the National Government. We have made great strides toward the objectives of the National Industrial Recovery Act. for not only have several millions of our unemployed been restored to work but in- dustry is organizing itself with a greater understanding that reasonable profits can be earned while at the same time protection can be assured to guarantee to labor adequate pay and proper conditions of work. Child labor is abolished. Uniform standards of hours and wages apply today to 95 percent of industrial employment within the field of the National Industrial Recovery Act. We ceek the definite end of preventing combinations in furtherance ol monopoly and in restraint of trade, while at the same time we seek to prevent ruinous rivalries within industrial groups which in many cases resemble the gang wars of the underworld and in which the real victim in every case is the public itself. Under the authority of thi.s Congress, we have brought the component parts of each industry together around a common table, just as we have brought problems affecting labor to a common meeting ground. Though the machinery, hurriedly devised, may need readjustment from time to time, nevertheless I think you will agree with me that we have created a permanent feature of our modernized industrial structure and that it will continue under the supervision but not the arbitrary dictation of Government itself. You recognized last spring that the most serious part of the debt burden affected tho.se who stood in danger of losing their farms and their homes. I am glad to tell you that refinancing in both of these cases is proceeding with good success and in all probability within the financial limits set by the Congress. y But agriculture had suffered from more than its debts. Actual experience with the operation of the Agricultural Adjustment Act leads to my belief that thus far the experi- ment of seeking a balance between production and con- sumption is succeeding and has made progress entirely in line with reasonable expectations toward the restoration of farm prices to parity. I continue in my conviction that industrial progress and prosperity can only be attained by bringing the purchasing power of that portion of our pop- ulation which in one form or another is dependent upon agriculture up to a level which will restore a proper balance between every section of the country and every form of work. In this field, through carefully planned flood-control, power-development, and land -use policies, in the Tennessee Valley and in other great watersheds, we are seeking the elimination of waste, the removal of poor lands from agri- culture, and the encouragement of small local industries, thus furtheringHhis principle of a better-balanced national life. We recognize the great ultimate cost of the applica- tion of this roundpd policy to every part of the Union. Today we are creaLng heavy obligations to start the work, and because of the great unemployment needs of the mo- ment. I look forward, however, to the time in the not distant future when annual appropriations, wholly covered by current revenue, will enable the work to proceed with a national plan. Such a national plan will; in a generation or two, return many times the money spent on it; more im- portant, it will eliminate the use of inefficient tools, con- serve and increase natural resources, prevent waste, and enable millions of our people to take better advantage of the opportunities which God has given our country. I cannot, unfortunately, present to you a picture of com- plete optimism regarding world affairs. The delegation representing the United States has worked in close cooperation with the other American Republics as- sembled at Montevin Cox Hartley Ma pes Sinclair Cravens Hasting* Marland Slrovlcb Cronby Healey Marnhall Siaaon Crow. Tex. Henney Martin. Colo. Smltb. V». CroMer. Ohio HiKglnii Martin. MaM. Smith. Wash. Crowe Hildebrandt Martin. Oreg. Smith, W.Va. Crowiher Cnimp Hill. Ala. May Snell Hill. Knute Mead Snyder Cu^K:n Hill. Samuel B. Meeks Somera. N.T. Cuhea Hoeppel Merrltt Spence DarUeu Hotdale Millard Stalker D*rrow Holllater Miller Steagalt I>ear Holmeit Milllgan Stokes Deen Hooper Mitchell Strong. Pa. Delnney Hope Monaghan. Mont . Strong. Tex. De Prtea Howard Montague Stubbs DfBouen Huddleston Montet Studley Dickinson Imhoff Moran Sullivan Dtrkbtfln Jacobsen Morehead Sumners. Tex. Dle.« James Mott Sutphln Dlngell Jeffers Muldowney Swank Dtrksen Jenckes, Ind. Murdock Sweeney Di.sney Jenkins. Ohio Musselwhlte Swlck Dltter Johnson. Minn. Nesblt Taber Dobbins Johnson. Okla. Norton Tarver Dockweller Johnson. Tex. OConnell Taylor. Colo. Dondero Jones O'Connor Taylor. S C. Doughton. N.C. Kahn OMalley Taylor. Tenn. Dougiasii Kee Oliver. Ala. Terrell, Tex. DoweU Keller Oliver. N.Y. Thorn Doxey Kelly. Pa. Owen Thomason. R. E. Drewry Kennedy. Md. Palmlsano Thompson. 111. Driver Kennedy. N.Y. Parker Thurston DulTey Kenney Parks Traeger Duncan. Mo. Kerr Parsons Tread way D.inn Klnzer Patman Truax Durgan. Ind. Kleberg Peavey Turner Eagle Kloeb Perkins Turpin Katon Kniffln Peterson Umstead E.Cher Knutson PettengUl Underwood E-.lzey. Miss. Koclalkowskl Peyser Utterback Eltse. Calif. Kopplemann Pierce Vinson. Oa. Knglebright Kramer Polk Wadsworth Kvaa.s Kurtz Pou Waldron Paddls Kvale Powers Wallgren Far ey Lambertson Prall Walter Pe: n^ndez Lambeth Ramsay Warren Peslnger Lamneck Ramspeck Wear In F'sh Lanham Randolph Weaver Pitzpatrlck LauKetta Rankin Weldeman Plannagan Larrabee Ransley Welch F'cxciier Lea. Calif. Ray bum Werner Focht Lehlbach Reece West. Ohio Ford ^ Lehr Reed, NY. West. Tex Fos8 Lemke Reld. ni. White Frear Lesln.skl Rellly Whitley Fuller Lewl.s, Colo. Rich Whittlngton Pulmer Lewis. Md. Richards Wigglesworth Gambrlll Lindsay Richardson WliroX Oasque Lloyd Robertson Will ford Gavagai: Lozler Robinson Williams Olfford Luce Rogers. Mass. Wilson Gilchrist Ludlow Rogers. N.H. Wlthrow GUle.'ple Lundeen ■ Rogers. Okla. Wolcott Gillette McCarthy Rudd Wolfenden Giover McCimtlc Ruffln Wolverton Ottldsborough McCormack Sabath Wood. Ga. ifcadwin McDuffle Sadowski Wood. Mo. >«on McPadden Sanders Woodruff Onmfield McFarlane Sandlln Wood rum Ormy McOrath Schaefer Young Or«enwood McGugln Schuetz Zloncheck Gregory McKeown Schulte The Speaker Orlswold McLean • Scrugham Guyer McLeod Sears January 3 Mr. McMillan announced that his colleague. Mr. Oasqtte, is confined to his bed and unable to be present. The SPEAKER. Three hundred and ninety-four Members have ans'vered to their names. A quorum is present. CALENDAR WEDNESDAY Mr. BYRNS. Mr. Speaker, I ask unanimous consent that Calendar Wednesday be dispensed with. The Sl'EAKER. Is there objection to the request of the gentleman from Tennessee? There was no objection. NOTinCATION TO THE PRESIDENT Mr. BYRNS. Mr, Speaker, I offer the following resolu- tion. The Clerk read as follows: House Resolution 197 Resohed, That a committee of three Members be appointed by the Speaker on the part of the House of Representatives to join irlth the committee on the part of the Senate to notify the Presi- dent of the United States that a quorum of each House has been fissembled, and that Congress Is ready to receive any communlca- i^n that he may be pleased to make. The resolution was agreed to. The SPEAKER appointed as the committee Mr. Byrhs. dr. DotJCHTON, and Mr. Swell. NOTIFICATION TO THE SENATE Mr, BUCHANAN. Mr. Speaker. I offer the following rc»- (^lution. The Clerk read as follows: House Resolution 200 Resolved. That the Clerk of the House Inform the Senate that s quorum of the House has appeared and that the House la ready to proceed with business. The resolution was agreed to. HOUR OF DAILY MEETING Mr. POU. Mr. Speaker. I offer the following resolution. The Clerk read as follows : House Resolution 201 Resolved, That the hour of daily meeting shall be at 12 o'clock ^leridian. The resolution was agreed to. MESSAGE FROM THE SENATE A message from the Senate, by Mr. Home, its enrolling ilerk, announced that the Senate had passed the following Resolutions : Senate Resolution 104 Resolved. That the Senate has heard with deep regret and pro- lound sorrow the announcement of the death of Hon. Porter H. ])ale, late a Senator from the State of Vermont. Resolved. That the Secretary communicate these resolutions to 1 he House of Representatives and transmit a copy thereof to the lamlly of the deceased. ResoU'ed. That, as a further mark of respect to the memory of he deceased, the Senate do now adjourn. Senate Resolution 105 Resolved. That the Senate has heard with deep regret and pro- lound sorrow the announcement of the denth of Hon. John B. ItENDRicK. late a Senator from the State of Wyoming. Resolved, That the Secretary communicate these resolutions to 1 he House of Representatives and transmit a copy thereof to the lamlly of the deceased. Resolved, That, as a further mark of respect to the memory of 1 he deceased, the Senate do now adjourn. Senate Resolution 106 Resolved, That a committee consisting of two Senators be ap- ] (olnted to join such committee as may be appointed by the House if Representatives to wait upon the President of the United litates and inform hira that a quorum of each House Is assembled, ),nd that the Congress is ready to receive any communication he 1 nay be pleased to make. In compliance with the foregoing the Vice President appointed us said committee Mr. Robinson of Arkansas and Mr. McNaby. Senate Resolution 107 Resolved, That the Secretary Inform the House of Representa- 1 1ves that a quorum of the Senate Is assembled and that the ilenate is ready to proceed to business. iiDJOURNMENT OF CUBAN HOUSE OF REPRESENTATIVES ON JULY 4, 1933 The SPEAKER laid before the House the following com- munication from the President of the House of Representa- ives of Cuba, a translation of which was read: Habana 66 CtJBAN Govt. 5/348P. 1 JPEAKEH House of Representatives U. S. of A.. Washington, DC: C^mara Representantes Republica de Cuba acord6 suspender su I essl6n dia cuatro como homenaje de slmpatia a la gran naclon { lei norte en aniversarlo independencia cuya fecha tlene para los )ueblos este contlnente singular transccndencia porque consargrb a idea elevada mas tarde a prlnciplo Juridico de la America para OS Americanos. Dr. Rafael Guas InclAn. Presidente Cdmara RepresentanteM. [Translation] Habana. Cuban Government. Speakeb House op Representatives, U S.A. Washington. D.C.: The House of Representatives of the Republic of Cuba voted ;o adjourn its session on the Fourth as a token of sympathy vlth the great nation of the North on the anniversary of its <^ 1934 CONGRESSIONAL RECORD— HOUSE 9 Independence, which date la of singular Importance to the nations of this continent becauae It consecrated the Idea elevated later to a legal principle of America for Americans. Dr. Ratacl On*a InclAm. Pretident of the House of Representatives. The SPEAKER alao laid before the House the following communication from the President of the Senate of Cuba, which was read: Miami, Pla.. November 29 — P. ,30 p.m. Honorable Bpcakb or mx Hovtt or RcpmcsnrrAmrca, Washington, DC: Honorable brothers, we beseech you In the name of humanity to take some action to prevent the slaughter of political prisoners at the hands of the de facto government of Cuba. We are exiled here in the United States, but there are many political prisoners In Cuba among which are Congressmen and Senators. Most respectfully, Bakkekas, President of the Senate. ^ OuAs InclAn, President of the House of Representatives. CHILD-LABOR AMENDMENT The SPEAKER laid before the House communications from the Governor of the State of Iowa, from the secretary of state of the State of Maine, from the Governor of the State of North Dakota, from the Governor of the State of Oklahoma, from the Governor of the State of Illinois, and from the secretary of state of the State of Minnesota, an- nouncing the ratification by the several States of the pro- posed amendment to the Constitution of the United States granting to Congress power to limit, regulate, and prohibit the labor of persons under 18 years of age, which were severally read. REPEAL OF EIGHTEENTH AMENDMENT The SPEAKER also laid before the House communications from the secretary of state of the State of Colorado, from the Governor of the State of New York, from the secretary of state of the State of Connecticut, and from the secretary of state of the State of Utah announcing the ratification by the several States of the twenty -first amendment to the Constitution of the United States, which were severally read. REPORT or COMMITTEE TO WAIT UPON THE PRESIDENT Mr. BYRNS. Mr. Speaker,*your committee appointed on the i3art of the House to join with a committee on the part of the Senate to wait on the President of the United States and notify him that a quorum of the two Houses is assem- bled, and that Congress is ready to receive any communica- tion that he may be pleased to make, performed that duty. The President asked us to report that he will be pleased to deliver in person his message this afternoon to a joint session of the two Houses. JOINT SESSION Mr. BYRNS. Mr. Speaker, I offer the following concur- rent resolution and ask its immediate consideration. The Clerk read as follows: House Concurrent Resolution 25 Reitolved by the House of Representatives (the Senate con- curring), That the two Houses of Congress assemble in the Hall of the House of Representatives on Wednesday, the 3d day of Jan- uary 1934, at 1:30 o'clock In the afternoon, for the purpose of receiving such communications as the President of the United States shall be pleased to make to them. The SPEAKER. The question is on agreeing to the resolution. The resolution was agreed to. RECESS Mr. BYRNS. Mr. Speaker, I ask unanimous consent that the House now stand in recess subject to the call of the Chair. The SPEAKER. Is there objection? There was no objection; accordingly (at 12 o'clock and 46 minutes p.m.) the House stood in recess. AFTER RECESS The recess having expired, the House (at 1 o'clock and 28 minutes p.m.) resumed its session. FTTRTHER MESSAGE FROM THE SENATE A further message from the Senate, by Mr. Home, its enrollini clerk, announced that the Senate had agreed to the concurrent resolution (H-ConJles. 25) Drovidins that the two Houses of Congress assemble in the Hall of the House of Representatives on Wednesday, the 3d day of January 1934, at 1:30 o'clock in the afternoon, for the purpose of receiving such communicaticms as the President of the United States shall be pleased to oiake to them. joxMT MKrmro or tbx bbhats aitd bovss At 1 o'clock and 80 minutes p.m. the Doorkeeper. Mr. J. J. Sinnott, announced the Vice President of the United SUtes and the Members of the United States Senate. ITie Members of the House rose. The Senate, preceded by the Vice President and by their Secretary and Sergeant at Arms, entered the Chamber. The Vice President took the chair at the right of the Speaker, and the Members of the Senate took the seats reserved for them. The SPEAKER. Cm behalf of the House, the Chair ap- points the following committee to conduct the President into the Chamber: Messrs. Byrns. Doughton, and Snell. The VICE PRESIDENT. On the part of the Senate, the Chair appoints as a like committee Senators Robikson of Arkansas. McNary, and Fletcher. At 1 o'clock and 32 minutes p.m. the Doorkeci«r. Mr. J. J. Sinnott, announced the Cabinet of the President of the United States. The Members pf the Cabinet of the President entered the Chamber and tdols. the seats reserved for them in front of the Speaker's rostrum. At 1 o'clock and 35 minutes pjn. the President of the United States, escorted by the committee of Senators and Representatives, entered the Hall of the House and stood at the Clerk's desk, amid prolonged applause. The SPEAKER. Senators and Representatives, I have the distinguished honor of presenting to you the President of the United States. [Applause.] address by the president of the xjNirra) states The PRESIDENT. Mr. President. Mr. Speaker, Senators, and Representatives in Congress, I come before you at the opening of the regular session of the Seventy-third Con- gress not to make requests for special or detailed items of legislation: I come, rather, to counsel with you. who. like myself, have been selected to carry out a mandate of the whole people, in order that without partisanship you and I may cooperate to continue the restoration of our national well-being and, equally important, to build on the ruins of the past a new structure designed better to meet the present problems of modem civilization. [Applause.] Such a structure includes not only the relations of industry and agriculture and finance to each other but also the effect which all of these three have on our individual citizens and on the whole people as a nation. Now that we are definitely in the process of recovery, lines have been rightly drawn between those to whom this recov- ery means a return to old methods — and the number of these people is small — and those for whom recovery means a reform of many old methods, a permanent readjustment of many of our ways of thinking, and, therefore, of many of our social and economic arrangements. Civilization cannot go back; civilization must not stand still. We have undertaken new methods. It is our task to perfect, to improve, to alter when necessary, but in all cases to go forward. To consolidate what we are doing, to make our economic and social structure capable of dealing with modern life, is the joint task of the legislative, the judicial, and the executive branches of the National Grovemment. Without regard to party, the ovetwhelming majority of our people seek a greater opportunity for humanity to pros- per and find happiness. They recognize that human welfare has not increased, and does not increase, through mere materialism and luxury, but that it does progress through integrity, unselfishness, responsibility, and justice. [Ap- plause.] In the past few months, as a result of our action, we have demanded of many citizens that they surrender certain licenses to do as they please in their business relationships; I 1 c f r 10 CONGRESSIONAL but wf have asked this in exchange for the protection which the state can give against exploitation by their fellow men or by combinations of their fellow men. I congratulate this Congress upon the courage, the earnest- ness, and the efficiency with which you met the crisis at the special session. It was your fine understanding of the national problem that furnished the example which the country has so splendidly followed. I venture to say that the task confronting the First Congress of 1789 was no greater than your own. I shall not attempt to set forth either the many phases of the crisis which we experienced last March, nor the many measures which you and I undertook during the special ses- sion that we might initiate recovery and reform. It is sufficient that I should speak in broad terms of the results of our common counsel. [Applause.] The credit of the Government has been fortified by dras- tic reduction in the cost of its permanent agencies through the Economy Act. With the twofold purpose of strengthening the whole financial structure and of arriving eventually at a medium of exchange which will have over the years less variable purchasing and debt-paying power for our people than that of the past, I have used the authority granted me to pur- chase all American- produced gold and silver [applause] and to buy additicnal gold in the world markets. Careful in- vestigation and constant study prove that in the matter of foreign -exchange rates certain of our sister nations find themselves so handicapped by internal and other conditions that they feel unable at this time to enter into stabilization discussions based on permanent and world-wide objectives. The overwhelming majority of the banks, both National and State, which reopened last spring, are in sound condi- tion and have been brought within the protection of Federal insurance. In the case of those banks which were not per- mitted to reopen, nearly $600,000,000 of frozen deposits are being restored to the depositors through the assistance of the National Government. We have made great strides toward the objectives of the National Industrial Recovery Act, for not only have several millions of our unemployed been restored to work but indus- try is organizing itself with a greater understanding that reasonable profits can be earned while at the same time protection can be assured to guarantee to labor adequate pay and proper conditions of work. Child labor is abolished. Uniform standtirds of hours and wages apply today to 95 percent of industrial employment within the field of the National Industrial Recovery Act. We seek the definite end of preventing combinations in furtherance of monopoly and in restraint of trade, while at the same time we seek to prevent ruinous rivalries within industrial groups which in many cases resemble the gang wars of the underworld and in which the real victim in every case is the public itself. Under the authority of this Congress we have brought the component parts of each industry together around a com- mon table, just as we have brought problems affecting labor to a common meeting ground. Though the machinery, hur- riedly devised, may need readjustment from time to time. nevertheless I think you will agree w;th me that we have created a permanent feature of our modernized industrial structure and that it will continue under the supervision. but not the arbitrary dictation of Government itself. [Ap- plause.] You recognized last spring that the most serious part of the debt burden affected those who stood in danger of losing their fahns and their homes. I am glad to tell you that refinancing in both of these cases is proceeding with good success, and in all probability within the financial limits set by the Congress. But agriculture had suffered from more than it debts. Actual e.\perience with the operation of the Agricultural Adjustment Act leads to my belief that thus far the experi- ment of si-eking a balance between production and consump- tion is succeeding and has made progress entirely in Une with reasonable expectations toward the restoration of farm A -i.. RECORD— HOUSE January 3 prices to parity. I continue in my conviction that indus- trial progress and prosperity can only be attained by bring- ing the purchasing power of that portion of our population which in one form or another is dependent upon agriculture up to a level which will restore a proper balance between every section of the country and every form of work. [Applause.] In this field, through carefully planned flood-control, power-development, and land-use policies, in the Tennessee Valley and in other great watersheds, we are seeking the elimination of waste, the removal of poor lands from agri- culture, and the encouragement of small local industries, thus furthering this principle of a better-balanced national life. We recognize the great ultimate cost of the applica- tion of this rounded policy to every part of the Union. Today we are creating heavy obligations to start the work, and because of the great unemplojTneht needs of the moment. I look forward, however, to the time in the not distant future when annual appropriations, wholly covered by current revenue, will enable the work to proceed with a national plan. Such a national plan will, in a generation or two. return many times the money spent on it; more im- portant, it will eliminate the use of inefficient tools, con- serve and increase natural resources, prevent waste, and enable millions of our people to take better advantage of the opportunities which God has given our country. I cannot, unfortunately, present to you a picture of com- plete optimism regarding world affairs. The delegation representing the United States has worked in close cooperation with the other American Republics assembled at Montevideo to make that conference an out- standing success. We have, I hope, made it clear to our neighbors that we seek with them future avoidance of territorial expansion and of interference by one nation in the internal affairs of another. [Applause.] Furthermore, all of us are seeking the restoration of commerce in ways which will preclude the building up of large favorable trade balances by any one nation at the expense of trade debits on the part of other nations. In other parts of the world, however, fear of immediate or future aggression, and with this the spending of vast sums on armament and the continued building up of de- fensive trade barriers, prevents any great progress in peace or trade agreements. I have made it clear that the United States cannot take part in political arrangements in Europe, but that we stand ready to cooperate at any time in prac- ticable measures on a world basis looking to immediate reduction of armaments and the lowering of the barriers against commerce. [Applause.] I expect to report to you later In regard to debts owed the Government and people of this country by the governments and peoples of other countries. Several nations, acknowl- edging the debt, have paid in small part; other nations have failed to pay. One nation, Finland, has paid the in- stallments due this country in full. [Applause.] Returning to home problems, we have been shocked by many notorious examples of injuries done our citizens by persons or groups who have been living off their neighbors by the use of methods either unethical or criminal. In the first category— a field which does not involve viola- tions of the letter of our laws — practices have been brought to light which have shocked those who believed that we were in the past generation raising the ethical standards of business. They call for stringent preventive or regulatory measures. I am speaking of those individuals who have evaded the spirit and piu-pose of our tax laws [applause], of those high officials of banks or corporations who have grown rich at the expense of their stockholders or the pub- hc, of those reckless speculators with their own or other people's money whose operations have injured the values of the farmers' crops and the savings of the poor. [Applause.] In the other category, crimes of organized banditry, cold- blooded shooting, lynching, and kidnaping have threatened our security. These violations of ethics and these violations of law call on the strong arm of government for their immediate 1934 CONGRESSIONAL RECORD— HOUSE 11 suppression; they call also on the country for an aroused public opinion. [Applause.] The adoption of the twenty-first amendment should give material aid to the elimination of those new forms of crime which came from the illegal traffic in liquor. [Applause.] I shall continue to regard it as my duty to use whatever means may be necessary to supplement State, local, and private agencies for the relief of suffering caused by imem- ployment. With respect to this question, I have recognized the dangers inherent in the direct giving of relief and have sought the means to provide not mere relief but the oppor- tunity for useful and remunerative work. We shall, in the process of recovery, seek to move as rapidly as possible from direct relief to publicly supported work, and from that to the rapid restoration of private employment. It is to the eternal credit of the American people that this tremendous readjustment of o"r national life is being accomplished peacefully, without serious dislocation, with only a minimum of injustice, and with a great, willing spiiit of cooperation throughout the country. Disorder is not an American habit. Self-help and self- control are the essence of the American tradition — not of necessity the form of that tradition, but its spirit. The program itself comes from the American people. It is an integrated program, national in scope. Viewed in the large, it is designed to save from destruction and to keep for the future the genuinely important values created by modern society. The vicious and wasteful parts of that society we could not save if we wished; they have chosen the way of sell-destructi«n. We would save useful me- chanical invention, machine production, industrial efficiency, modern means of communication, broad education. We would save and encourage the slowly growing impulse among consumers to enter the industrial market place equipped with sufficient organization to insist upon fair prices and honest sales. But the unnecessary expansion of industrial plants, the waste of natural resources, the exploitation of the consumers of natural monopwlies, the accumulation of stagnant sur- pluses, child labor, and the ruthless exploitation of all labor, the encouragement of speculation with other people's money — these were consumed in the fires that they them- selves kindled. We must make sure that as we reconstruct our life there be no soil in which such weeds can grow again. [Applause.] We have plowed the furrow and planted the good seed; the hard beginning is over. If we would reap the full har- vest, we must cultivate the soil where this good seed is sprouting and the plant is reaching up to mature growth. A final personal word. I know that each of you will ap- preciate that I am speaking no mere politeness when I assure you how much I val^e the fine relationship that we have shared during these ''tnonths of hard and incessant work. Out of these friendly contacts we are. fortunately, building a strong and permanent tie between the legislative and executive branches of the Government. The letter of the Constitution wisely declared a separation, but the im- pulse of common purpose declares a union. In this spirit we join once more in serving the American people. LApplause, the Members rising.] Thereupon, at 2 o'clock pjn., the President retired from the Hall of the House. At 2 o'clock and 1 minute p.m. the Speaker announced that the joint session was dissolved. Thereupon the vice President and the Members of the Senate returned to their Chamber. RESIGNATION OF MEMBERS OF THE HOUSE The SPEAKER laid before the House the following resig- nations. The Clerk read as follows: HiLLSBORO, III., October 3, 1933. Hon. Henry T. Rainet. Speaker of the Hotue of Representatives. Washington, D.C. Mt Dear Speaker Rainet: I beg leave to inform you that 1 have this day transmitted to the Honorable Henry Horner, Gov- ernor of Illinois, my resignation as a Representative In the Con- gress of the United States from the Twenty-flrst District of liUnott. to brcome effective at noon on FYiday, October 6, 1933. With kind personal regards, I am. Sincerely yours, J. Earl Major. October 30. 1933. Hon. Henrt T. Rainet, Speaker of the House of Representatives, Washington. D.C. My Dear Mr. Speaker : I am enclosing you herewith copy of my letter of resignation directed to the Governor of Vermont. It Is with regret that I sever my relations with the member- ship of the House. I want you to know that I appreciate more than words can express the very many courtesies received at your hands. With personal regards and best wishes, I am, Sincerely yours, E. W. Gnsoir. SWEARING IN OF NEW MEMBERS The SPEAKER laid before the House the following com- munication from the Clerk of the House containing the names of Members-elect. The Clerk read as follows: January 3, 1934. Hon. Henry T. Rainky. Speaker of the HoxLse^of Representatives, Washington. D.C. My Dear Mr. Speaker: Certificates of election in due form of the following Representatives-elect to the Seventy-third Congress to flu vacancies have been filed in this office, viz: District and SUt« Representative-*lect Predecessor Isabella Oreenway Clark W. ThoiDpsoD.. Paul Brown.J Ix)uis W. Douflas. Rpventh Texas rUy Stone Bnegs. Chita. U. Brand. T'i^nth 0#iftrffia .-.._ Fifth Arkansas ....... -. David D. Tert-y- A. H. Carmichael Oliver W Frey Andrew Edniiston Hearlstn Ragon. Fichth AlabamA Edward B. Almoa. Ninth Pennsylvania . Henr>W. Wstaon. Third West Vireinia Lynn S. Uornor. Very truly yours. South Trimble, Cleric of the House of Representatives. Mr. SNELL. Mr. Speaker, Mrs. Marian W. Clarke, of the Thirty-fourth Congressional District of the State of New York. is present and desires to take th^roith of office. I may say to the Speaker and to the Members of the House that Mrs. Clarke was elected at an election duly called by the Gover- nor of the State December 28. but on account of the laws of the State she can not get her certificate for several days. She was elected by a majority of around 6,000. There is no contest, and no irregularities are claimed. I should be pleased to have her take the oath at this time, if there is no objection. The SPEAKER. Is there objection to the request of the gentleman from New York?, There was no objection. The SPEAKER. The Members-elect and the gentle- woman from New York LMrs. Clarke] will assemble in the well of the House and take the oath of office as prescribed by law. The Members-elect, including Mrs. Clarke, of New York, and Mr. Ellenbogen. of Pennsylvania, appeared in the well of the House and the Speaker administered the oath of office. MRS. BOLIVAR E. KEMP, SR. The SPEAKER. The Chair lays before the Hotise the following communication from the Clerk: Hon. Henry T. Rainey, Speaker of the House of Representatives . Washington. D.C. Dear Sir: I transmit herewith a certificate of election of Mrs. Bolivar E. Kemp, Sa., to fill the vacancy caused by the death at Hon. Bolivar E. Kemp, from the Sixth Congressional District of the State of Louisiana, received by this office, signed by the Governor of Louisiana, attested by the seal and by the secretary of state of the State of Louisiana. I also transmit herewith a communication from the Citizens' Election Committee of the Sixth Congressional District of the State of Louisiana In the form of a certificate of election of Hon. 12 'CONGRESSIONA RECORD— HOUSE '• January 3 if I : i J. Y. Sakdehs. Jh.. to fill the vacancy caused by the death of Hoi. Eollvar E. Kemp, from Sixth Cocgressional District of the Sta^e ot Louisiana. ! •^ Yours very truly. ■ i j South Trimblb, Clerk of the House of Representatives. Mr. WILSON. Mr. Speaker..! offer the following resoli- tion. The Cleric read as follows: House Resolution 202 Resolved. That the question of prima facie as well as the flniil right of Mrs. Bolivar E Kemp. Sr.. and J. Y. Sanders, Jr., cor - testants, respectively, claiming a seat in this House from the Slxta District of Louisiana, be referred to the Committee on Elections No. 3; and until such committee shall have reported in t^e premises and the House decided such question neither of said contestants shall be admitted to a seat. The SPEAKER. The gentleman from Louisiana is recog- nized for 1 hour. Mr, V7ILSON. Mr. Speaker. I may state that this resoli - tion is offered in accord with the wishes of the Louisiania delegation in Congress, and that vital questions are involved affecting the inherent rights not only of the citizens (f Louisiana but of every State in the Union, as well as of the Congress itself. I am offering this resolution and asking its speedy con- sideration. I have requested that it be referred to the Committee on Elections No. 3 because on the Committee oa Elections No. 1 is a Member from the State of Louisiansi. We want an unbiased and independent consideration and report to the House upon the important legal questiors involved. Committee on Elections No. 2 has many cases before it. Committee on Elections No. 3 has only a fev ^ases before it. and, since we are seeking speedy considera- tion. I am asking that it be referred to that committee. Mr. Speaker. I shall be very glad to yield time if anyone desires to be heard in the matter. Mr. FERNANDEZ. Mr. Speaker. I have asked the gentle- man from Louisiana to yield me as much time as he sha 1 use. However. I wish to say I do not intend to consume more than 3 minutes of it. for I think in that time we cai get to the point where the previous question can be movel and the matter referred to the committee. Mr. WILSON. Mr. Speaker. I yield 3 minutes to th? gentleman from Louisiana [Mr. Fernandez.] Mr. FERNANDEZ. Mr. Speaker, by agreement of th; Louisiana delegation in Congress, we have acquiesced in the resolution introduced by the gentleman from Louisiani [Mr. Wilson]. For my part, from all rules and precedents. I am of th ; opinion that Mrs. Kemp should have received the oath of cfBce today. However, rather than have this matter com; before the House today we are perfectly willing, and Mrs. Kemp is perfectly willing, that the whole matter be ref erre i to the Committee on Elections No. 3, since it is a legal tiuestion, expecting that an early report will be forthcomini ; from that committee and final determination made by th i House. Mr. SUMNERS of Texas. Mr. Speaker, will the gentleman 3neld for a question. Mr. WILSON. I yield. Mr. SUMNERS of Texas. Will either of the gentlemen state, what I understand to be the fact, that the arrange- ment made with reference to the matter is. under the cir- cumstances, acceptable to and agreed to by both the parties to the contest? » Mr. WILSON. Yes. Mr. SUMNERS of Texas. We are glad to have that on the record. Mr. McCLINTIC. Mr. Speaker, will the gentleman yieldt Mr. WILSON. I yield. Mr. McCLINTIC. Has the gentleman conferred with the chairman of the committee to ascertain whether the com- mittee can give this case a preferential status? Mr. WILSON. There are no contests pending before this committee. If we can have prompt action it will be desirt- able, for it Involves questions ol very great importance td this House, and not only to the citizens of Louisiana, but to those of every other State. Mr. Speaker, I move the previous question. The SPEAKER. The question is on ordering the previous question. The previous question was ordered. The resolution was agreed to. A moticn to reconsider was laid on the table. PERMISSION TO ADDRESS THE HOUSE Mr. GOLDSBOROUGH. Mr. Speaker. I ask unanimous consent that tomorrow, after matters on the Speaker's table are disposed of, I may address the House for 1 hour on necessary monetary and banking legislation. Mr. BYRNS. Mr. Speaker, reserving the right to object — and I dislike very much to do so — I say to the gentleman from Maryland that I have already had one or two other requests to make speeches tomorrow. The gentleman from North Carolina, the chairman of the Ways and Means Committee, has presented today a bill pro- viding for taxation of liquor. Every day this bill is delayed means a loss of thousands of dollars to the Treasury of the United States. Mr. DOUGHTON of North Carolina. Three quarters of a million. Mr. BYRNS. The gentleman reminds me that it means the loss of three quarters of a million every day this bill is delayed. I think it is exceedingly important that nothing stand in the way of the consideration of this bill. These gentlemen desire to take it up under the general rules of the House. They have provided for very brief debate, so I am told, of only 4 hours. The bill itself is short and should be com- pleted not later than Friday at the outside. In view of the fact I have declined to accede to a similar request of several gentlemen, I hope the gentleman from Maryland will, for the moment at least, withdraw his request. Mr. GOLDSBOROUGH. Mr. Speaker, I ask unanimous consent that on next Monday, after the disposal of matters on the Speaker's desk, I be allowed to address the House for 1 hour. Mr. BYRNS. Mr. Speaker, may I say to the gentleman from Maryland that that will probably be all right unless some appropriation bill is under consideration. We may have an appropriation bill ready for consideration on Mon- day, and if the House agrees with me it will be our purpose to give the most liberal time for debate under the general rules of the House. The gentleman can easily get time dur- ing the consideration of that bill, and I hope he will at least delay his request until we can see more light. Mr. VINSON of Georgia. Regular order, Mr. Speaker. The SPEAKER. Is there objection to the request of the gentleman from Maryland? Mr. BYRNS. For the present. Mr. Speaker, I shall have to object. I hope the gentleman will withdraw the request, because we will probably be able to arrange the matter later. Of course. I have no disposition to deny the gentleman the right to be heard. May I make this remark in response to what has just been said to me privately — not by the gentleman from Maryland? There is no disposition to prevent any Member of the House from having every opportunity to discuss any ques- tion that he may desire enuring this session, and my objection does not go to that extent. My objection at the present time is simply due to the fact that we want to dispose of the legislation before us. and if I can bring it about, every gentleman upon both sides of this Chamber will have the fullest opportunity to discuss any question that is relevant to any matter that is before the House, and at the very earliest opportunity, but I think we should proceed in order. I have had two or three such requests, and if we grant one for tomorrow, you will find that every hour of tomorrow will be taken up by general debate upon subjects which are not pending. I think we ought to consider the legislation re- ferred to first, and the only object I have in mind is to expedite the business of the House. 1934 CONGRESSIONAL RECORD— HOUSE IS TAXATION OW WTOXICATIHG LIQUOBS Mr. DOUGHTON of North Carolina, Chairman of the Ccmunittee on Way* and Means, presented a favorable report on the bill (HJi. 6131) to raise revenue by taxing certain intoxicating liquors, azui for other purposes, which was read the first and second time, and, with the accompan3ang papers, referred to the Committee of the Whole House on the state of the Union. THE APPROPRIATIONS COUMjmX Mr. BUCHANAN. Mr. Speaker, as a result of the last election the subcommittees of the Committee on Appropria- tions had to be reorganized, as so many of the minority members were retired to private life. There is nothing in the Congressional Directory or the Record to give the Members of the House the names of the personnel of the various subcommittees as announced Just after the adjournment of the last session. I therefore ask unanimous consent to insert in the Record at this point the organization of the* different subcommittees. The SPEAKER. Is there objection to the request of the gentleman from Texas? There was no objectloiL The matter referred to follows: PSB80NKKL OF THS 10 PnMANXIfT SUBCOMMTmEBS OF TBS AFPBO- PKiATioNs coicMirrez E>eflclencle8 : Messrs. Buchanan (chairman), Taylor, Ayres of Kansas. Arnold, Collins, Oliver of Aljvbama, Taber, Bacon, Thurston, and Bolton. State. Jxistlce, Ck)mmerce. and Labor: Messrs. Oliver of Alabama (chairman). Griffin. McMillan, Woodrum. Bacon, and Mrs. ELahn. Agriculture: Mi imiii ff^"**"" (chairman) . Hart, Cannon, Sinclair, and Thurston. War: Messrs. Collins (chairman). Parks, Blanton. Bolton, and Powers. Independent Offloes: Messrs. Woodrum (chairman). Boylan, Hastings. Granfleld. Wlgglesworth, and Ooss. Interior: Messrs. Taylor (chairman), Hastings. Jacobsen, Lam- bertson. and Dltter. Perxoanent Appropriations: Messrs. OrlAn (chairman), Mc- MUlan. Parks. Cary, Goss, and Wlgglesworth. Navy: Messrs. Ayres of Kansas (chairman), Cary. Hart, Swlck, and Buckbee. District of Columbia: Messrs. Cannon (chairman), Blanton. Jacobsen, Ditter. and Powers. Treasury and Post Offlce: Messrs. Arnold (chairman), Aber- nethy, Ludlow, Boylan, Taber, and McLeod. Legislative: Messrs. Ludlow (chairman), Granfleld. Sandlln, McLeod, and Sinclair. Mr. BUCHANAN. Mr. Speaker, as the Members of the House know, a month ago I called five subcommittees of the Committee on Appropriations together to conduct hearings on five appropriation bills. These five committees have just about finished the departmental hearings, as well as all other hearings, but the committees, having been convened when the Members of the House were absent, have held their hearings open to hear any Member of Congress who may desire to appear before them on any item in the different bills. I am, therefore, serving notice upon the membership of the House that if any Member desires to be beard oi) the Interior Department bill, the State, Justice, Commerce, and Labor bill, the Navy bill, the independent offices bill, or the Post Offlce and Treasury bill to get in touch with the chair- man (rf the subcommittee and he will grant you your right to be heard on any item. If you want an increase of ap- propriation he will give you a respectful hearing. If you want a decrease, he will listen to you most attentively. Mr. SNELL. Will the gentleman 3rield for one question? Mr. BUCHANAN. I yield to the gentleman trom New York. Mr. SNELL. Has the gentleman made up his mind yet which appropriation bill will be presented first to the House? Mr. BUCHANAN. No; I have not. That will be deter- mined tomorrow. Mr. BRITTEN. Will the gentleman yield for a question? Mr. BUCHANAN. Yes. Mr. BRITTEN. I congratulate the gentleman upon giv- ing this information to the House, and I am wondering if it would not be possible at this time to also insert in the Record, in the interest of expediency of the public business. the names of the almost couxitless admlDistratioas, corpo- rations, councils, committees, authorities, boards, and corps which have been established by Executive order during the recess of Congress. House Members from every secticHi of the country are be- ing importuned for information concerning an of these gov- ernmental activities, and I find it practically impossible to keep abreast of their management of public affairs. Many thousands of employees have been enrolled, some of them at very high salaries, and I am sure that the gentleman's committee will shortly make inquiry into these personnel expenditures, all of which, of course, are made without direct appropriations by Congress. Hardly a day passes without the institution of a new busi- ness-controlling or regulating device under Executive order and I hope that it will be possible for the House to be kept informed concerning these new commissions and their re- spective expense upon the Treasury. They are so profuse in number and their titles in many instances so confusing that it has become a common custom to refer to them by initials in the " alphabet soup " of the new deaL A few that I have in mind are ttie AA.A.., Agricultursil Adjustment Administration; CAJB., Ccmsumers' Advisory Board: C.C, Consumers' Council: CXJ.C, Civilian Cwiserva- tion Corps: CJS.B., Central Statistical Board: C.WA., CivU Works Administration: E.C.. Executive Council: E.CP.C, Executive Commercial PoUcy Committee; EJLF^^ Electri- cal Home and Farm Authority; P.A.C«A., Federal Alc(^€d, That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THE LATE REPRESENTATIVE BOLIVAR E. KEMP Mr. WILSON. Mr. Speaker, it is with profound sorrow that I announce the death of my colleague, the Honorable Bolivar E. Kemp, a Representative from the State of Louisi- ana. It is a great loss to his district, the State, and the Nation. He was my personal i .lend, and cooperated in every way in legislation for the best interests of his district and the State. I offer the following resolution. The Clerk read as follows: House Resolution 205 Resolved, That the House has heard with profound sorrow of the deat^ of Hon. Bolivas E. Kemp, a Representative from the State of Louisiana. Resolved. That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THE LATE REPRESENTATIVE LYNN S. HORNOR Mr. SMITH of West Virginia. Mr. Speaker, it is with profound sorrow that I am called upon to announce the death of my colleague, Lynn S. Hornor, of West Virginia. I offer the resolution which I send to the desk and ask its immediate consideration. The Clerk read as follows: House Resolution 206 Resolved, That the House has heard with profound sorrow of the death of Hon. Ltnn S. Hornor. a Representative from the State of West Virginia. Resolved. That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THE LATE REPRESENTATIVE JOHN D. CLARKE Mr. REED of New York. Mr. Speaker it is with a sense of deep personal loss that I announce the death of my dear 1934 CONGRESSIONAL RECORD— HOUSE 15 friend the Honorable John D. Cuuuck, late a Representative from the State of New York. I offer the following resolution, which I send to the desk. The Clerk read as follows: Hotise Resolution 207 Keadlved. That the House has heard with profound sorrow of the death of Hon. John D. Clarke, a Representative from the State of New York. Resolved. That the Clerk communicate these reaolutlons to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THl LATE REPRBSENTATryE HENRY W. WATSON Mr. DARROW. Mr. Speaker, it is with profound sorrow and with a deep personal feeling that I announce the death of Henry W. Watson, of Pennsylvania, late a Representative in this body. I offer the following resolution, which I send to the desk. The Clerk read as follows: House Resolution 208 Resolved, That the House has heard with profound sorrow of the death of Hon. Hek«t W. Wat»on. a RepresenUtlve from the State of Pennsylvania. Resolved, That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THE LATE SENATOR JOHN B. KENDRICK Mr. CARTER of Wyoming. Mr. Speaker, it is with pro- found sorrow that I announce the death of the Honorable John B. Kendrick. late a Senator from the SUte of Wyo- ming. I offer the following resolution, which I send to the desk. TTie Clerk read as follows: House Resolution 209 Resolved, That the House has heard with profound sorrow of the death of Hon. John B. Kendrick. a Senator of the United States from the State of Wyoming. Resolved, That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. The resolution was agreed to. THE LATE SENATOR PORTER H. DALE Mr. MARTIN of Massachusetts. Mr. Speaker, I offer the following resolution, which I send to the desk. The Clerk read as follows: House Resolution 210 Resolved, That the House has heard with profound sorrow of the death of Hon. Porter H. Dale, a Senator of the United States from the State of Vermont. Resolved, That the Clerk commxmlcate these resolutions to the Senate and tfansmlt a copy thereof to the family of the deceased. The resolution was agreed to. LEAVE OF ABSENCE By unanimous consent, leave of absence was granted as follows: To Mr. Hess, indefinitely, on account of illness. To Mr. Burke of California, indefinitely, on account of illness in family. To Mr. Douglass, indefinitely, on account of illness. To Mr. RoMJUE, indefinitely, on account of illness. To Mr. Carley of New York, indefinitely, on account of illness. To Mr. Brown of Michigan, indefinitely, on account of Important business. ADJOURNMENT Mr. BYRNS. Mr. Speaker, out of respect to the memory of our deceased colleagues, I move that the House do now adjoiim. The motion was agreed to; accordingly (at 2 o'clock and 39 minutes pjn.) the House adjourned until tomorrow, Tliursday. January 4. 1934, at 12 o'clock noon. EXECUTIVE COifMUNICATIONS, ETC. Under clause 2 of rule XXIV. executive communications were taken from the Speaker's table and referred as follows; 110. A letter from the Acting Secretary of War, transmit- ting herewith draft of a bill to authorise credit in disbursins oflacers' accounts covering shipment of privately owned auto- mobiles from October 12. 1927, to October 10. 1929: to the Committee on Claims. 111. A letter from the Acting Secretary of War, transmit- ting herewith draft of a bill to reimburse offloers, enlisted men, and civilian employees of the Army and their f aanilles and dependents, or their legal representatives, for losses sus- tained as a result of the hurricane which occurred in Texas on August 16, 17, and 18. 1915; to the Committee on Claims. 112. A letter from the Secretary of War, pursuant to the act of Congress approved January 5. 1905 (33 Stat., p. 599), entitled "An act to incorporate the American National Red Cross " as amended by the act approved Feb- ruary 27, 1917 (39 Stat. p. 946) . I have the honor to advise that the reports for the fiscal year ending June 30, 1933, have been audited by the Chief of Finance, United States Army, and found correct; to the Committee on Military Affairs. 113. A letter from the Acting Secretary of War, trans- mitting herein the draft of a bill to amend the act of May 22. 1928. to authorize the collection, in monthly install- ments, of indebtedness due the United States from enlisted men. and for other purposes; to the C(»nmittee on Military Affairs. 114. A letter from the Secretary of the Navy, transmitting herewith in accordance with the provisions of paragraph (m). section 10. of the act approved July 2. 1926 (44 Stat. 787, title 10. sec. 310 (m), UJS.C. supp. VI). a report-of de- signs, aircraft, aircraft parts, and aeronautical accessories purchased by the Navy Department pursuant to section 10 of said act during the fiscal year ended June 30, 1933. the prices therefor and the reason for the award in each case; to the Committee on Expenditures in the Executive Depart- ments. 115. A letter from the Secretary of the Navy, trananitting herewith a draft of a proposed bill to authorize certain officers of the Navy and Marine Corps to administer oaths; to the Committee on Naval Affairs. 116. A letter from the Secretary of the Navy, transmitting herewith a draft of legislation to confer authority on chief clerks and inspectors attached to the offices of inspectors of naval material, chief clerks attached to field services tmder the Naval Establishment and to navy yards, naval stations, and Marine Corps posts and stations, and such other clerks and employees as may be designated by the Secretary of the Navy to administer oaths; to the Committee on Naval Affairs. 117. A letter from the Secretary of the Navy, transmitting herewith a draft of a proposed bill to amend article 6 of the articles for the government of the Navy authorizing trial by courtmartial of any person in the Naval Service charged with the crime of murder committed without the geographical limits of the States of the Union and the District of Columbia; to the Committee on Naval Affairs. 118. A letter from the Secretary of the Navy, transmitting herewith a draft of a proposed bill to provide for the better administration of Justice in the Navy; to the Committee on Naval Affairs. 119. A letter from the Secretary of the Navy, transmitting herewith a draft of a proposed bill to amend section 1 of the act of February 14, 1927. entitled "An act authorizing the Secretary of the Navy to accept on behalf of the United States title in fee simple to a certain strip of land and the construction of a bridge across Archers Creek in South Carolina "; to the Committee on Naval Affairs. 120. A letter from the Secretary of the Navy, transmitting herewith a draft of a proposed bill to amend the provisions in the act approved June 10. 1896, prohibiting the employ- ment of officers of the Navy or Manne Corps on the active or retired list by persons or companies furnishing naval sup- plies or war material to the Government; to the Committee on Naval Affairs. 121. A letter from the Secretary of the Navy, transmitting herewith a draft of a bill to authorize the wearing of minia- ! i 16 ture facsimile medals, with ribbon, by personnel of the Nav3 and Marine Corps awarded medals; to the Committee or Naval Affairs. 122. A letter from the Secretary of the Navy, transmitting herewith a draft of a proposed bill to amend section 1860 o^ the Revised Statutes, as amended, to permit retired officer^ and enlisted men of the Army. NavT. and Marine Corps U hold civil office in any Territory of the United States; to th< Committee on Naval Affairs. 123. A letter from the Secretary of the Navy, transmittin herewith a draft of a bill to authorize certain officers of th United States Navy and officers and enlisted men of th Marine Corps to accept such decorations, orders, and meda" as have been tendered them by foreign governments in ap preciaticn of servicts rendered; to the Committee on Nav: Affairs. 124. A letter from the Secretary of the Navy, transmittinj herewith a draft of a proposed bill for the conservation, care custody, protection, and operation of the naval petroleun and oil-shale reserves, and for other purposes; to the Com mittee on Naval Affairs. 125. A letter from the Secretary of the Navy, transmittinj herewith a 4raft of a proposed bill to amend section 2 o th€ act entitled "An act to give war-time rank to retiree officers and former officers of the Army. Navy, Marine Corps, and or Coast Guard of the United States", approved Jun< 21. 1930. so as to prohibit persons who have been subse Quently separated from the service under other than hon orable conditions from bearing the official title and upor occasions of ceremony wearing the uniform of the highes grade held by them during their war service; to the Com mittee on Military Affairs. 126. A letter from the Secretary of the Navy, transmittinj herewith a draft of a bill to amend section 1383 of the Re vised Statutes of the United States, the existing law pro viding for the bonding of supply officers of the Navy (sec 1383. ^v. Stat., U.S.C, title 34, sec. 64) ; to the Committee on Naval Affairs. 127. A letter from the Secretary of the Navy, transmitting herewith a draft of a bill to amend section 109 of ihe Unitec Slates Criminal Code so as to except officers of the Unitec States Naval and Marme Corps Reserve not on active dutj from certain of its provisions; to the Committee on the Judiciary. 128. A letter from the Secretary of the Navy, transmittins herev;rith a draft of a bill to provide for the removal of civi or criminal prosecutions from a State court to the United States d.strict court in certain cases; to the Committee on the Judiciary. 129. A letter from the Secretary of the Navy, transmitting herewith a draft of a bill to amend the act entitled "An act to amend an act entitled 'An act to prohibit the unauthor- ized wearing, manufacture, or sale of medals and badges awarded by the War Department, approved February 24 1923 ', approved April 21. 1928 ". so as to include the Navy; to the Committee on Military Affairs. 130. A letter from the Secretary of the Navy, transmittins herewith a draft of a proposed bll to amend paragraph 1 o1 section 22 of the Interstate Commerce Act. as amended, hii providing for the carrying of officers and enlisted men c^ the military and naval services while on leave of absence or furlough at own expense at reduced rates; to the Committee on Interstate and Foreign Commerce, 131. A letter from the Secretary of the Navy, transmit- ting, pursuant to the act of March 3. 1909 (35 Stat. 769) as amended by the act of August 29. 1916 '39 Stat. 605) requiring the amount expended from each of the appro- priations for the repair of each ship where such repair; exceed for any one ship the sum of $300,000 in any on< fiscal year. I have the honor to report that during the fisca year ending June 30, 1933, there was an overexpenditure ol the statutory limit on the U.S.S. New York of $55,259.38; t( the Committee on Expenditures in the Executive E)epart- ments. 132. A letter from the Secretary of War, transmitting ar Itemized annual report of the American National Red Cros! CONGRESSIONAL RECORD— HOUSE January 3 for the year ended June 30. 1933. as audited by the Chief of Finance, United States Army, and found correct; to the Committee on Military Affairs. 133. A letter from the Secretary of Commerce, transmit- ting herewith, in accordance with section 12 of the Suits in Admiralty Act c41 Stat. 525). a report of claims arbitrated or settled between October 15. 1932, and October 15. 1933, by the United States Shipping Board Merchant Fleet Corpora- tion; to the Committee on Merchant Marine, Radio, and Fisheries. 134. A letter from the Secretary of Commerce, trans- mitting herewith draft of bill entitled "A bill to authoriza the Secretary of the Navy and the Secretary of Commerce to exchange a portion of the naval station and a portion of the lighthouse reservation at Key West. Fla."; to the Committee on Interstate and Foreign Commerce. 135. A letter from the Secretary of War, transmitting a draft of proposed legislation to credit to officers of the Army certain services as cadets in the United States Military Academy; to the Committee on Claims. 136. A letter from the Secretary of the Smithsonian In- stitution, transmittins herewith a schedule of papers and documents in the National Museum which are not needed in the transaction of public business and which, in the opinion of this institution, have no permanent value or historical interest; to the Committee on Disposition of Use- less Executive Papers. 137. A letter from the First Assistant Secretary of War. transmitting at the instance of Hon. Raymond C. Brown. Secretary of the Territory of Hawaii, a copy of the Senate Journal of the Legislature of Hawaii, 1933; to the Com- mittee on the Territories. 138. A letter from the Actin?; Secretary of the Treasury, transmitting the Annual Report of the Federal Bureau of Narcotics, prepared by the Commissioner of Narcotics, for the calendar year ended December 31. 1932j to the Com- mittee on Ways and Means. 139. A letter from the chairman and secretary of the Re- construction Finance Corporation, transmitting its report covering its operations for the third quarter of 1933, and for the period from the organization of the Corporation on February 2, 1932, to September 30, 1933, inclusive (H.Doc. No. 199) ; to the Committee on Banking and Currency, and ordered to be printed. 140. A letter from the chairman and secretary of the Re- construction Finance Corporation, transmitting its report covering its operations for the second quarter of 1933. April 1 .to June 30. 1933, inclusive, and for the period from the organization of the Corporation on February 2, 1932, to June 30, 1933. inclusive; to the Committee on Banking and Cur- rency and ordered to be printed. 141. A letter from the Acting Secretary of Commerce, transmitting herewith part 2 of the Annual Report of the Commissioner of Lighthouses for the fiscal year ended June 30. 1933; to the Committee on Interstate and Foreign Commerce. 142. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers. United States Army, dated August 14. 1933. submitting a report, together with accompanying papers, on a preliminary examination of waterway from the Mississippi River to the Intracoastal Waterway by way of Bayou Manchac, Amite River, Lake Maurepas, Pass Manchac, Lake Pontchartrain. and the Rigolets. La., authorized by the River and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors. 143. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated August 11, 1933. submitting a report, together with accompanying papers, on a preliminary examination of channel in San Carlos Bay, Fla., from Punta Rasa to deep water in the Gulf of Mexico, authorized by the River and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors. 144. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, i^/-\VTi^T^T7apers, on a preliminary examination of West Galveston Bay and adjacent waters, Texas, with a view tp determining whether the construction of channels through Redfish Reef has caused an increase in the salt-water con- tent in Trinity River, or other waterways, etc., authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 155. A letter from the Secretary of War, transmitting pursuant to section 10 of the Flood Control Act approved May 15, 1928. a letter from the Chilef of Engineers. United States Army, dated June 22. 1933, subrhitting a report, to- gether with accompanying papers and illustrations, on h survey of the Maquoketa River, Iowa, for the purposes of navigation and efiBcient development of its water power, the control of floods, and the needs of irrigation; to the Com- mittee on Flood Control. 156. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated July 6. 1933, submitting a report, together with accom- panying papers, on a preliminary examination of Wilson Harbor, N.Y., authorized by the River and Harbor Act ap- proved July 3, 1930; to the Committee on Rivers and Harbors. 157. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated July 6, 1933, submitting a report, together with accom- panying papers on a preliminary examination of Kissimmee River, Fla., from Kissimmee to Port Bassenger; and from Port Bassenger to Lake Okeechobee, with a view to its improvement for the purpose of navigation, together with its effect on flood control, authorized by the River and Har- bor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 158. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated July 6, 1933, submitting a report, together with accom- panying papers, on a preliminary examination of Manistee Harbor. Mich., authorized by the River and Harbor Act ap- proved July 3, 1930; to the Committee on Rivers and Harbors. 159. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated July 7, 1933, submitting a report, together with ac- companying papers, on a preliminary examination and sur- vey of Neah Bay, Wash., with a view to the construction of a harbor of refuge, authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 160. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated July 5, 1933, submitting a report, together with ac- companying papers, on a preliminary examination of Neuae River, N.C., from the wharves at New Bern to Goldsboro, N.C., with a view to providing a depth of 8 feet with suitable width, authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 161. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers. United States Army, dated July 5, 1933, submitting a report, together with ac- companying papers, on a preliminary examination of Ogun- quit Harbor and Perkins Cove, Maine, authorized by the River and Harbor Act approved July 3, 1930; to the Com- mittee on Rivers and Harbors. 162. A letter from the Secretary of War, transmitting pursuant to section 10 of the Flood Control Act approved May 15, 1928, a letter from the Chief of Engineers, United States Army, dated Jime 22. 1933, submitting a report, to- gether with accompanying papers and illustrations, on a survey of Rock River, 111. and Wis., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation; to the Conmiittee on Flood ControL LXX\TII- r 11 18 CONGRESSIONAL RECORD— HOUSE January 3 163. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated September 30, 1933, submitting a report, together with accompanying papers, on a preliminary examination and survey of Gastineau Channel. Alaska, authorized by the River and Harbor Act approved January 21, 1927; to the Committee on Rivers and Harbors. 164. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers, United States Army, dated September 30. 1933, submitting a report, together with accompanying papers on a preliminary examination of Rock River, m. and Wis., from Janesville to the dam at the head of the feeder of thp Illinois and Mississippi Canal at or near Sterling, thence ^ way of the canal feeder to the Illinois and Mississippi Canal, with a view to securing a navigable channel 9 feet in depth and of suitable width, authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 165. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated November 21, 1933. submitting a report, together with accom- panying papers, on a preliminary examination of waterway from Norfolk, Va.. to the sounds of North Carolina, includ- ing the Dismal Swamp Canal, authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 166. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers, United States Army. dated August 10, 1933, submitting a report, together with accompanying papers, on a preliminary examination of Trinidad Bay, Hlmiboldt County. Calif., authorized by the River and Harbor Act approved July 3. 1930; to the Commit- tee on Rivers and Harbors. 167. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army. dated September 14» 1933, submitting a report, together with accompanjTing papers, on a preliminary examination and survey of channel leading from Oyster, Va.. to the Atlantic Ocean, authorized by the River and Harbor Act approved January 21, 1927; to the Committee on Rivers and Harbors. 168. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers, United States Army. dated September 14, 1933, submitting a report, together with accompanying papers, on a preliminary examination i of Abbapoola Creek. Johns Island. S.C.. authorized by the River and Harbor Act approved July 3, 1930; to the Com- mittee on Rivers and Harbors. 169. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated December 12. 1933, submitting a report, together with accompanying papers, on a preliminary examination and survey of Kansas (Kaw) River. Kans. and Mo., authorized by the River and Harbor Act approved July 3. 1930; to the C(xxunittee raa Rivers and Harbors. 170. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers, United States Army, dated December 11, 1983. submitting a report, together with accompanying papers, on a preliminary examination of Portland Harbor. Maine, along the water front of South Portland, authorized by the River and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors. 171. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers. United States Army, dated September 14. 1933. submitting a report, together with acc(xnpanying papers, on a preliminary examination of Bear Creek. Md., authorized by the River and Harbor Act ap- proved July 3. 1930; to the Committee on Rivers and Harbors. 172. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated September 14. 1933. submitting a report, together with •ccompanying papers, on a preliminary examination of Curtis Creek. Md.. authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 173. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated September 14, 1933, submitting a report, together with accompanying papers, on a preliminary examination of Col- gate Creek, Md.. authorized by the River and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors. 174. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated September 14. 1933. submitting a report, together with accompanying papers, on a preliminan examination of Brazos River. Tex., up to Rosenberg, authorized by the River and Harbor Act approved January 21, 1927; to the Com- mittee on Rivers and Harlwrs. 175. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated September 14, 1933. submitting a report, together with accompanying papers, on a preliminary examination of Back River, Md.. authorized by the River and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors. 176. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated November 13, 1933, submitting a report, together with accompanjring papers, on a preliminary examination and survey of Newport Bay, Calif., authorized by the River and Harbor Act approved September 22. 1922; to the Committee on Rivers and Harbors. 177. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated September 30, 1933, submitting a report, together with accompansdng papers, on a preliminary examination of Min- nesota River. Minn., authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 178. A letter from the Secretary of War. transmitting, pursuant to section 10 of the Flood Control Act approved May 15. 1928., a letter from the Chief of Engineers. United States Army, dated June 16. 1933. submitting a report, to- gether with accompanying papers and illustrations, contain- ing a general plan for the improvement of Twelvepole Creek, W.Va.. for the purposes of navigation and efiflcient develop- ment of its water power, the control of floods, and the needs of irrigation; to the Committee on Flood Control. 179. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated November 13, 1933, submitting a report, together with accompanying papers, on a preliminary examination of Los Angeles Harbor. Calif., authorized by the River and Harbor Act approved July 3, 1930; to the Conmiittee on Rivers and Harbors. 180. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers, United States Army, dated July 6, 1933, submitting a report, together with accom- panying papers, on a preliminary examination and survey of Port Austin Harbor. Mich., authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Hartwrs. 181. A letter from the Secretary of War. transmitting. pursuant to section 10 of the Flood Control Act approved May 15. 1928, a letter from the Chief of Engineers, United States Army, dated June 19, 1933, submitting a report, to- gether with accompanying papers and illustrations, on a survey of the Wapsipinicon River, Iowa and Minn:, for the purposes of navigation and eflBcient development of its water power, the control of floods, and the needs of Irriga- tion; to the Committee on Flood Control. 182. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated August 11. 1933. submitting a report, together with accompanying papers, on a preliminary examination of harbor at Port Orford. Oreg.. authorized by the River and Harbor Act approved July 3, 1930; to the Committee on Rivers and Harbors. 183. A letter from the Clerk of the House of Representa- tives, transmitting list of reports to be made to Congress by public officers during the Seventy-third Congress (HDoc. No. 148) ; to the Committee on Accounts and ordered to bo printed. 1934 CONGRESSIONAL RECORD— HOUSE 19 184. A letter from the Acting Secretary of War. transmit- ting, pursuant to section 1 of the River and Harbor Act approved January 21. 1927. a letter from the Chief of Engineers. United States Army, dated September 25. 1933. submitting a report, together with accompanying papers and j illustrations, containing a general plan for the improvement j of Rappahannock River. Va.. for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation (H.Doc. No. 186) ; to the Committee on Rivers and Harbors and ordered to be printed with two illustrations. 185. A letter from the Secretary of War. transmitting, pur- suant to section 1 of the River and Harbor Act approved January 21. 1927, a letter from the Acting Chief of Engineers. United States Army, dated October 9. 1933. submitting a report, together with accompanying papers and illustrations, on the Delaware River, for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation (HX>oc. No. 179); to the Com- mittee en Rivers and Harbors and ordered to be printed with 30 illustrations. 186. A letter -from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army. dat€d S£:ptember 6, 1933. submitting a report, together With accompanying papers and illustrations, on a preliminary examnation and survey of Arecibo Harbor. PR., authorized ■ by the Pliver and Harbor Act approved July 3. 1930; to the Committee on Rivers and Harbors and ordered to be printed with twu illustrations. 187. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated December 6. 1933, submitting a report, together with accompanying papers and illustrations, on a preliminary examination and survey of Lake Worth Inlet. Fla.. author- ized by the River and Harbor Act approved July 3. 1930 (H.Doc. No. 185) ; to the Committee on Rivers and Harbors and ordered to be printed with two illu.-wrations. 188. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers. United States Army, dated December 9. 1933, submitting a report, together with accompanying papers and illustrations, on a preliminary examination and survey of Calumet River, Little Calumet River, Lake Calumet, and the Sag Channel. 111., with a view to providing a connection with and terminal transfer har- bors for the waterway from Chicago to the Mississippi River, authorized by the River and Harlxar Act approved July 3. 1930 (H.Doc. No. 180); to the Committee on Rivers and Harbors and ordered to be printed with two illustrations. 189. A letter from the Secretary of War. transmitting, pursuant to section 1 of the River and Harbor Act approved January 21. 1927. a letter from the Acting Chief of Engi- neers. United States Army, dated October 14. 1933, submit- ting a report, together with accompanying papers and illus- trations, on Klamath River, Oreg. and Calif., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irriga- tion (HX>oc. No. 181); to the Committee on Rivers and Harbors and ordered to be printed with three illustrations. 190. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers. United States Army, dated September 30, 1933, submitting a report, together with accompanying papers and illustration, on a preliminary examination and survey of southern branch of the Eliza- beth River, Norfolk Harbor, Va., authorized by the River and Harbor Act approved July 3, 1930 (HX)oc. No. 182); to the Committee on Rivers and Harbors and ordered to be printed with an illustration. 191. A letter from the Secretary of War, transmitting a letter from the Chief of Engineers, United States Army, dated September 12, 1933, submitting a report, together with accompanying papers and illustrations, on a preliminary examination and survey of New York Harbor. N.Y.. author- ized by the River and Harbor Acts approved August. 8. 1917 and July 3. 1930 (HXtoc. No. 183) ; to the Committee on Rivers and Harbors and ordered to be printed with two illustrations. 192. A letter from the Secretary of War. transmitting a letter from the Chief of Engineers. United States Army, dated December 6. 1933, submitting a report, together with accompanying papers and illustrations, on a survey of Illi- nois River, 111., authorized by the River and Harbor Act approved July 3. 1930 (HJ>oc. No. 184) ; to the Committee on Rivers and Harbors and ordered to be printed with five illustrations. 193. A letter from the Secretary of War, transmitting, pursuant to section I of the River and Harbor Act approved January 21. 1927. a letter from the Chief of Engineers, United States Army, dated September 12, 1933. submitting a report, together with accompanying papers and illustra- tions, containing a general plan for the improvement of Skagit River, Wash., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation (HXHjc. No. 187) ; to the Committee on R vers and Harbors and ordered to be printed with 11 illustrations. 194. A letter from the iSecretary of War, transmitting, pursuant to section 1 of the River and Harbor Act approved January 21. 1927. and section 10 of the Flood Control Act approved May 15. 1928. a letter from the Chef of Engineers, United States Army, dated June 22, 1933. submitting a report, together with accompanying papers and illustrations, containing a general plan for the improvement of the White and Bad Rivers, SX)ak. and Nebr.. for the purposes of navi- gation and efficient develcpment of its water jwwer. ths control of floods, and the needs of irrigation (HXtoc. No. 189) ; to the Committee on Rivers and Harbors and ordered to be printed with two illustrations. 195. A letter from the Secretary of War, transmitting pursuant to section 1 of the River and Harbor Act approved January 21. 1927, a letter from the Chief of Engineers, United States Army, dated December 15, 1933, submitting a report, together with accompanying papers and illustrations, on Snake River and tributaries, for the purposes of naviga- tion and efficient development of its water power, the control of floods, and the needs of irrigation < HXtoc. No. 190) ; to the Committer on Rivers and Harbors and ordered to be printed with eight illustrations. 196. A letter from the Secretary of War. transmitting, pursuant to section 1 of the River and Harbor act. approved January 21, 1927, a letter from the Chief of Engineers, United States Army, dated August 16, 1933, submitting a report, together with accompanying papers and illustrations, con- taining a general plan for the improvement of Mad River, Calif., for the purposes of navigation and efficient develop- ment of its water power, the control of floods, and the needs of irrigation (HXtoc. No. 188) ; to the Committee on Rivers and Harbors and ordered to he printed with seven illustra- tions. 197. A letter from the Secretary of War. transmitting pur- suant to the provisions of section 2 of the act of April 20, 1874 (U.S.C. p. 176. sec. 175). 454 r^orts of inspections of disbursements made by officers of the Army, which inspec- tions were made by the Inspector Greneral's Department during the fiscal year ended June 30, 1933; to the Committee on Expenditures in the Executive Departments. 198. A letter from the Secretary of War, transmitting, in compliance with the provisions of section 1665, Revised Stat- utes of the United States, a letter- from the Chief of Ord- nance. United States Army, dated December 7. 1933, for- warding statements of the cost of manufacture at the armory or arsenals therein named, for the fiscal year ended June 30, 1933: to the Committee on Expenditures in the Executive Departments. 199. A letter from the Secretary of War, transmitting draft of a bill to provide relief for disbursing officers of the Army in certain cases which the War Department presents for the consideration of the Congress with a view to its enactment into law; to the Committee" on Military Affairs. 200. A letter from the Secretary of War, transmitting draft of a bill to authorize the settlement of certain specified claims of military personnel for damages to and loss of pri- vate property incident to the training, practice, operation. 20 CONGRESSIONAL RECORD— HOUSE January 3 and maintenance of the Anny which the War Department presents for the consideration of the Congress with a view t6 its enactment into law ; to the Committee on Claims. | 201. A letter from the Secretary of War, transmitting draft of a bill to amend the act of June 15. 1933. amendinj the National Defense Act of June 3. 1916, as amended, whictt the War Department presents for the consideration of th<; Congress with a view to its enactment into law; to the Com- mittee on Mlhtary Affairs. 202. A letter from the Secretary of War, transmitting draft of a bill to establish the oflBce of professor of physic^ at the United States Military Academy at West Point, N.Yi which the War Department presents for the consideration of the Congress with a view to its enactment into law; to the ConMnittee on Military Affairs. 203. A letter from the Secretary of the Navy, transmit- ting draft of a proposed bill to authorize an exchange of lands between the Richmond. Fredericksburg L Potomai Railroad Co. and the United States at Quantico, Va.; to the Committee on Naval Affairs. 204. A letter from the Secretary of the Navy, transmit- ting draft of a proposed bill to regulate the distribution promotion, retirement, and discharge of commissioned officers of the Marine Corps, and for other purposes; tc the Committee on Naval Affairs. 205. A letter from the Secretary of War. transmitting pursuant to section 1 of the River and Harbor Act ap- proved January 21, 1927, a letter from the Chief of Engi-t nieers. United States Army, dated Jime 27, 1933, submitting a final report, together with accompanying papers and illus- trations, containing a general plan for the improvement of >thc Sacramento. San Joaquin, and Kern Rivers, Calif., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irriga- tion (HX)oc. No. 191); to the Committee on Rivers and Harbors, and ordered to be printed with nine illustrations. 206. A ^'letter from the Secretary of the Interior, trans mltting report of the War Minerals Relief Commission covering the period December 1. 1932, to November 30. 1933. inclusive, as required by section 5 of the act of March 2, 1919 (40 Stat. 1272) ; to the Committee on Expenditures in the ExecutiN-e Departments. 207. A letter from the Secretary of War, transmitting pursuant to section 1 of the River and Harbor Act, approved January 21. 1927, a letter from the Chief of Engineers, United States Army, dated August 18. 1933, submitting a report, together with accompanying papers and illustrations. containing a general plan for the improvement of James River. Va., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation *H.Doc. No. 192) ; to the Committee ^ on Rivers and Harbors and ordered to be printed with nine illustrations. 208. A letter from the Secretary of War. transmitting pursuant to section 1 of the River and Harbor Act approved January 21, 1927. a letter from the Chief of Engineers United States Army, dated September 26, 1933. submitting a report, together with accompanying papers and illustra- tions, containing a general plan for the improvement of Cape Pear River. N.C.. for the purposes of navigation ani efficient development of its water power, the control floods, and the needs of irrigation (HJXx;. No. 193) ; to th Committee on Rivers and Harbors and ordered to be prints with two illustrations. 209. A letter from the Secretary of War, transmitting pursuant to section 1 of the River and Harbor Act. approved January 21. 1927. a letter from the Chief of Engixieers] United States Army, dated August 17, 1933, submitting H report, together with accompanying papers and Ulustrationsj containing a general plan for the improvement of Eel River. Calif., for the purposes of navigation and efflcienn development of its water power, the control of floods, and the needs of irrigation (HXtoc. No. 194) ; to the Committee on Rivers and Harbors and ordered to be printed with two UlustratioDSk 210. A letter from the Secretary of Commerce, transmit- ting Annual Report of the Department of CMnmerce for the Fiscal Year 1933; to the Committee on Interstate and Foreign Commerce. 211. A letter from Assistant Director General of United States Railroad Administration, transmitting a report on the accumulation of documents and files of papers in the United States Railroad Administration not needed as permanent records; to the Conunittee on Disposition of Useless Execu- tive Papers. 212. A letter from the Acting Postmaster General, trans- mitting herewith a schedule of papers and documents which are not needed in the transaction of public business and which, in the opinion of this Department, have no perma- nent value of historical interest; to the Committee on Disposition of Useless Executive Papers. 213. A letter from the Acting Secretary of the Treasury, transmitting a commimication from the executive officer, Public Works Branch, Procurement Division, dated Decem- ber 20, 1933, submitting, in accordance with the requJ-e- ments of the act of March 4, 1909, a report of rental collections on account of public buildings and sites, privi- leges, and ground rent under control of the Treasury De- partment outside of the District of Columbia for the fiscal year ended June 30. 1933; to the Conmiittee on Expendi- tures in the Executive Departments. 214. A letter from the Acting Secretary of the Treasury, transmitting herewith, in compliance with the requirements of the act of June 30, 1906, reports from the Departments of Commerce, Interior, and War, the United States Railroad Administration, and the United States Shipping Board rela- tive to money received during the fiscal year ended June 30, 1933, also 32 reports from heads of other departments or independent establishments: to the Committee on Expendi- tures in the Executive Departments. 215. A letter from the Acting Secretary of the Treasury, transmitting in compliance with the requirements of sec- tion 3 of the act of May 29, 1928, a report showing refunds of internal revenue in excess of $500 approved by the Bureau of Internal Revenue during the fiscal year ended June 30. 1933, and forwarded to the disbursing clerk. Treasury De- partment, for payment or to the General Accounting Office for direct settlement; to the Committee on Expenditures in the Executive Departments. 216. A letter from the Secretary of War, transmitting pursuant to section 1 of the River and Harbor Act approved January 21, 1927, and section 10 of the Flood Control Act approved May 15, 1928, a letter from the Chief of Engi- neers, United States Army, dated December 6, 1933, submit- ting a report, together with accompanying papers and illustrations, containing a general plan for the improvement of the Kansas River, Colo., Nebr., and Kans., for the pur- poses of navigation ^nd efficient development of water power, the control of floods, and the needs of irrigation (H.Doc. No. 195) ; to the Committee on Rivers and Harbors and ordered to be printed with 56 illustrations. 217. A letter from the Secretary of War, transmitting, pur- suant to section 1 of the River and Harbor Act approved January 21, 1927, and section 10 of the Flood Control Act of May 15, 1928, a letter from the Chief of Engineers, United States Army, dated November 16. 1933. submitting a report, together with accompanying papers and. illustrations, on the Yazoo River. Miss., for the purposes of navigation and effi- cient development of water power, the control of floods, and the needs of irrigation (HDoc. No. 198) ; to the Committee on Rivers and Harbors and ordered to be printed with 64 illustrations. 218. A letter from the Secretary of War. transmitting, pur- suant to section 1 of the River and Harbor Act approved January 21, 1927. and section 10 of the Flood Control Act approved May 15, 1928, a letter from the Chief of Engineers, United States Army, dated December 6, 1933, submitting a report, together with accompanjring papers and illustrations, containing a general plan for the improvement of the Ouachita River and tributaries, Arkansas and Louisiana, fair 1934 CONGRESSIONAL RECORD— HOUSE 21 the purposes of navigation and efficient development of water power, the control of floods, and the needs of irriga- tion (HDoc. No. 196); to the Committee on Rivers and Harbors and ordered to be printed with 36 illustrations. 219. A letter from the Secretary of War, transmitting, pursuant to section 1 of the River and Harbor Act approved January 21, 1927, a letter from the Chief of Engineers, United States Army, dated November 2. 1933, submitting a report, together with accompanying papers and illustrations, on Platte River, Colo., Wyo., and Nebr., for the purposes of navigation and efficient development of its water power, the control of floods, and the needs of irrigation (H.Doc. No. 197) ; to the Committee on Rivers and Harbors and ordered to be printed with 22 illustrations. 220. A letter from the Acting Chief of Engineers, United States Army, requesting a correction in the draft of a bill proposed by the War Department in a letter dated April 26, 1933. for the relief of the D. F. Tyler Corporation and the Norfolk Dredging Co., both of Norfolk, Va.; to the Committee on Claims. 221. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report sent to the President by the Tariff Commission in an investigation for the purposes of section 336 of the Tariff Act of 1930. with respect to agricultural hand tools; to the Committee on Ways and Means. 222. A letter from the Chairman of the United States Tariff Commission, transmitting copy of statistical report entitled "Computed Duties and Equivalent Ad Valorem Rates on Imports into the United States from Principal Countries, 1931 "; to the Committee on Ways and Means. 223. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report sent to the President by the Tariff Commission in an investigation, for the purposes of section 336 of the Tariff Act of 1930. with respect to cotton velvets and velveteens; to the Com- mittee on Ways and Means. 224. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report sent to the President by the Tariff Commission in an investigation with respect to methods of valuation, in accordance with the provisions of section 642 of the Tariff Act of 1930; to the Committee on Ways and Means. 225. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report in an investigation with respect to synthetic camphor conducted in accordance with a special provision in paragraph 51 of the Tariff Act of 1930; to the Conunittee on Ways and Means. 226. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report sent to the President by the Tariff Commission in an investigation, for the purpose of section 337 of the Tariff Act of 1930. with respect to Russian asbestos; to the Committee on Ways and Means. 227. A letter from the Chairman of the United States Tariff Commission, transmitting copy of a report sent to the President by the Tariff Commission in an investigation, for the purposes of section 336 of the Tariff Act of 1930, with respect to fish in oil; to the Committee on Ways and Means. 228. A letter from the Clerk of the House of Representa- tives, transmitting in compliance with the provisions of paragraphs 102, 103, 104, and 111 of the Code of Laws of the United States, report for the period from July 1, 1932, to June 30. 1933, both inclusive, giving names of employees of the House and their respective compensations, including 'cifrks to Members; the expenditures from the contingent fund and from certain specific appropriations; the amounts drawn from the Treasury; the stationery accounts; and unexpended balances; to the Committee on Accounts. 229. A letter from the Secretary of War, transmitting pursuant to the provisions of the act of Congress approved July 9, 1918 (40 Stat. 850), authorizing the sale of war supplies, the annual report of such sales, covering the dis- posal of surplus property as shown in reports received from the various field agencies during the period October 15, 1932, to October 15, 1933, inclusive: to the Committee on Expenditures in the Executive Departments. 230. A letter from the Secretary of the Interior, transmit- ting statement of the fiscal affairs of all Indian tribes for whose benefit expenditures from public or tribal funds were made during the fiscal year ended June 30, 1933; to the Committee on Indian Affairs. 231. A letter from the Chainrfan of Interstate Commerce Commission, transmitting, in compliance with the provisions of section 19a of the Interstate Commerce Act, the Inter- state Commerce Commission has the honor to transmit herewith copies of various final valuations of properties of certain carriers subject to the act; to the Committee on Interstate and Foreign Commerce. 232. A letter from the Secretary of Agriculture, transmit- ting report of the Migratory Bird Conservation Commission for the fiscal year ending June 30, 1933, HXtoc. 201; to the Committee on Agriculture and ordered to be printed. 233. A letter from the Assistant Secretary of Commerce, transmitting, in compliance with section 15 of the Seaman's Act of March 4, 1915. a summary of reports with a brief statement of the action of the Department in respect to accidents sustained or caused by barges while in tow through the open sea during the fiscal year 1933; to the Committee on Merchant Marine, Radio, and Fisheries. 234. A letter from the Secretary of the Treasury, trans- mitting schedules and lists of papers, documents, etc., in the files of the Treasury Department which are not needed in the transaction of public business and have no permanent value; to the Committee on Disposition of Useless Executive Papers. 235. A letter from the Secretary of the Interior, trans- mitting recommendations of the Commissioner of Indian Affairs pursuant to the act of July 1, 1932 (47 Stat. 564) (H.Doc. No. 202) ; to the Committee on Indian Affairs, and ordered to be printed. 236. A letter from the president of the Commission on Licensure, Healing Arts Practice Act, District of Columbia, transmitting report showing the activities of the Commission on Licensure, Healing Arts Practice Act, District of Co- lumbia, for the fiscal year ended June 30, 1933 (HJJoc. No. 203) ; to the Committee on District of Columbia, and ordered to be printed. 237. A letter from the Comptroller General of the United States, transmitting the delinquency report of the Comp- troller General of the United States for 1933; to the Com- mittee on Expenditures in the Executive Departments. 238. A letter from Chief Clerk, Court of Claims of the United States, transmitting the advice that Congressional Case No. 17632, R. S. Howard Co., referred to the court toy private resolution of the House of Representatives July 3. 1926, was dismissed by the court January 9. 1933, for non- prosecution; to the Committee on Claims. 239. A letter from the Director of the United States Botanic Garden, transmitting information required by sec- tion 4. act of May 22, 1908, relative to travel from Washing- ton, D.C., in connection with the official business of that office during the fiscal year 1933; to the Committee on the Library. 240. A letter from the Postmaster General, transmitting on behalf of the board of tmstees, as required by section 1 of the act approved June 25, 1910, a report of the operations of the Postal Savings System for the fiscal year ended June 30, 1933 (H.Doc. No. 132) ; to the Committee on the Post Office and Post Roads and ordered to be printed. 241. A letter from the Secretary of War, as chairman of Puerto Rican Hurricane Relief Commission, transmitting a copy of the Fifth Annual Report of the Puerto Rican Hurri- cane Relief Commission, which is rendered in accordance with section 6, Public Resolution No. 74, Seventieth Congress, approved December 21. 1928 (HXtoc. No. 204) ; to the Com- mittee on Insular Affairs and ordered to be printed. 242. A letter from the Commissioners of the United States Tariff Commission, transmitting the Seventeenth Axmual Report of the United States Tariff Commission, In com- pliance with the provisions of section 332 of the act of Con- \ CONGRESSIONAL I ECORD— HOUSE 22 gresB approved June 17. 1930 ^H.Doc. No. 131) ; to the Com- ' mittee on Wavs and Means and ordered to be printed. 243 A letter from the Clerk. Court of Claims of the Umted States transmitting statement of all judgments rendered by the Court of Claims for the year ended December 2. 193J. to the Committee on Claims. , ^^ „ j 244 A letter from the Director of the Bureau of the Bud- get, transmitting a consolidated statement of the reports rendered by the several departments and independent estab- lishments and the municipal government of the District of Columbia, giving the required information as required by ■ection 203 of the act entitled "An act making appropria- tions for the legislative branch of the Government for the fiscal year ending June 30. 1933. and for other purposes "; to the Committee on Expenditures in the Executive De- partments. REPORTS OP COMMITTEES ON PUBLIC BILLS AND RESOLUTIONS Under clause 2 of rule Xm. Mr DOUGHTON of North Carolina: Committee on Ways and Means. HH. 6131. A bill to raise revenue by taxing cerUin intoxicating liquors, and for other purposes; without amendment (Rept. No. 271.) Referred to the Committee of the Whole House on the state of the Union. January 3 PUBLIC BILLS AND RESOLUTIONS Under clause 3 of rule XXn, public bills and resolutions were Introduced and severally referred as follows: By Mr. DOUGHTON of North Carolina: A bill (HJl. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes; to the Committee on Ways and Means. By Mr. MEAD: A bill (B.M. 6132) to repeal secUon 5 of the act of March 3. 1917. as amended, known as the "Reed bone-dry amendment ". and for other purposes; to the Com- mittee on the Post Office and Post Roads. By Mr. JONES: A bill (HJi. 6133) to make cattle a basic agricultiural commodity for the purposes of the Agricultural Adjustment Act; to the Committee on Agriculture. By Mr. GOLD6BOROUGH : A bill By Mr. MITCHELL: A bill (HJl. 6192) to amend the Agricultural Adjustment Act so as to include cattle as a basic agricultural commodity; to the Committee on Agri- culture. By Mr. KELLY of Pennsylvania: A bill (Hit. 6193) tc amend Public Law No. 2. Seventy-third Congress. entiUed "An act to maintain the credit of the United States Govern- ment ". and Public Law No. 78. Seventy-third Congress, en- titled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commis- sions, and offices, for the fiscal year ending June 30. 1934 and for other purposes "; to the Committee on World Wai Veterans' Legislation. By Mr. DUNN: A biU (HJl. 6194) to provide an increaa to compensations and pensions for veterans cf the World War. the Spanish-American War. and aU ex-service me^ and the widows of ex-service men; to the Committee on World War Veterans' Legislation. Also, a bill (HJl. 6195) to provide 25 percent increase ill salaries of postal and all other Federal employees who receivi j less than $3,000 per annum; to the Committee on Expendi- tiffes in the Executive Departments. By Mr. BUCKBEE: A bill (H.R. 6196) granting the con- sent of Congress to the State of Illinois to construct a fre; highway bridge across Rock River at Rockford, in Winne- bago Coimty. State of Illinois; to the Committee on Inter- state and Foreign Commerce. By Mr. QOLDSBOROUGH : A biU (HJl. 6197) to provid? for the examination and survey of the channel at thj entrance of the Claiborne- Annapolis Perry at Matapeak< , Md. ; to the Committee on Rivers and Harbors. By Mr. LUDLOW: A bill (HJl. 6198) to authorize the ReconstructkHi PlnaiK% Corporation to make direct loans 1 3 approved firms and corporations for working capital; to the Committee on Banking and Currency. By Mr. QOLDSBOROUGH: A bill (HJl. 6199) to provide for the examination and survey of the head of North East River. Cecil County. Md.; to the Committee on Rivers anl Harbors. By Mr. McLEOD: A bill (HJl. 6200) to eliminate injus- tices and discriminations inflicted upon disabled veterais and their dependents; to the Committee on World War Vet- erans' Legislation. By Mr. OUYER: A bill (HJl. 6201) to assure to persots within the jurisdiction of every State the equal protection < f the laws, and to punish the crime of lynching ; to the Con - mittee on the Judiciary. By Mr. MARTIN of Oregon: A bill (HJl. 6202) to add certain lands to the Mount Hood National Forest in tte State of Oregon; to the Committee on the Public Lands. By Mr. DIMOND: A bill (HJl. 6203) to provide for appeiil or writ of error from final judgments or iecisions in tie District Court for Alaska to the United States Circuit Cou t of Appeals: to the Committee on the Judiciary. By Mr. RAMSAY: A bill (HJl. 6204) giving the consent itf the United States for the bringing of certain suits in tie RECORD— HOUSE January 3 1934 CONGRESSIONAL RECORD— HOUSE 25 supreme Court of the United States, and for other purposes r to the Committee on the Judiciary. ^ ,>. uv By Mr 8CRUGHAM: A bill (HJl. 6205) to amend Pubbc Law No 2 Seventy-third Congress, entitled "An act to main- tain the credit of the United States Government ". and Pub- lic Law No. 78. Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commissions, and offices for the fiscal year ending June 30, 1934. and for other purposes "; to the Committee on World War Veterans' legis- lation. ^ .._,.». By Mr. UNDERWOOD: A biU (HJl. 6206) to establish a Department of Veterans' Affairs with a Secretary of Vet- erans' Affairs at the head thereof, to abolish the Veterans' Administration and transfer its functions pertaining to vet- erans' affairs to such department and its functions relating to the administration of the civil-service retirement laws to the Civil Service Commission, to adjust and equalize pen- sions of veterans and widows and dependents of veterans, and for other purposes; to the Committee on Expenditures in the Elxecutive Department. Also, a bill (HJl. 6207) to adjust and equalize benefits for veterans and widows and dependents of veterans, and for other purposes; to the Committee on World War Vet- erans' Legislation. By Mr. SABATH: A bill (HJl. 6208) declaring the act of September 19. 1890 (26 Stat., ch. 907, sec. 7). and the act of March 3, 1899 (30 Stat., ch. 425, sec. 9>. and aU acts amendatory of either thereof, shall not hereafter apply to a portion of the West Fork of the South Branch of the Chi- cago River in Cook County. III., and for other purposes; to the Committee on Rivers and Harbors. By Mr. JOHNSON of Oklahoma: A bill (H.R. 6209) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Govern- ment ". and Pubhc Law No. 78, Seventy-third Congress, en- Utled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, com- missions, and offices, for the fiscal year ending June 30. 1934, and for other purposes"; to the Committee on World War Veterans' Legislation. By Mr. SUTPHIN: A biU (H.R. 6210) to guarantee the principal of bonds issued by the Home Owners' Loan Cor- poration; to the Committee on Banking and Currency. By Mr. VINSON df Georgia: A bill (H.R. 6211) to provide for guaranteeing the principal of bonds issued by the Home Owners' Loan Corporation; to the Committee on Banking and Currency. My Mr. McLEOD: A bill HJl. 6212) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78. Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry inde- pendent executive bureaus, boards, commissions, and offices, for the fiscal year ending June 30, 1934, and for other pur- poses"; to the Committee on World War Veterans' Legis- lation. By Mr. HUDDLESTON: A bill (HJl. 6213) to prevent frauds in commerce, and for other purposes; to the Com- mittee on Interstate and Foreign Commerce. By Mr. HOEPPEL: A bill (H.R. 6214) to create jobs for millions of unemployed and to liquidate frozen assets in financial Institutions, without the issuance of tax-exempt bonds, through the establishment of county loan agencies to extend credit direct to the individual, companies, firms, asso- ciations, institutions, municipalities, schools, churches, and other public agencies for mortgage relief and repair, con- struction, and development purposes; to the Committee on Ways and Means. By Mr. SWICK: A bill (HJl. 6215) to amend Public Law No. 2, Sevjsnty-third Congress, entitled "An act to maintain the^Bi:edit of the United States Government ". and Public Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry inde- pendent executive bureaus, boards, commissions, and offices, for the fiscal year ending June 30, 1934, and for other pur- poses"; to the Committee on World War Veterans' Legis- lation. , . ^ _x By Mr. BLOOM: A bill (HJl. 6216) to establish a Depart- ment of National Archives of the United States of America: to the Committee on the Library. By Mr. KELLY of Pennsylvania: A biU (H.R. 6217) to establish a postal note system in the Postal Service; to the Committee on the Post Office and Post Roads. By Mr. HASTINGS: A bill (HJl. 6218) providing for the erection of a public building in the city of Stilwell, Okla.; to the Committee on Public Buildings and Grounds. Also, a bill (HJl. 6219) to repeal certain specific acts of Congress and an amendment thereto enacted to regulate the manufacture, sale, or possession of intoxicating liquors in the Indian Territory, now a part of the State of Oklahoma; to the Committee on the Judiciary. By Mr. GAVAGAN: A bill (HJl. 6220) to aosure to per- sons within the jurisdiction of every State the equal protec- tion of the laws, and to punish the crime of lynching; to the Committee on the Judiciary. By Mr. KELLY of Pennsylvania: A bill (H.R. 6221) to amend section 5 of the Reconstruction Finance Corpora- tion Act; to the Committee on Banking and Currency. By Mr. HASTINGS: A biU (H.R. 6222) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to main- tain the credit of the United States Government", and PubUc Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commissions, and offices for the fiscal year ending June 30, 1934, and for other purposes "; to the Committee on World War Veterans' Legislation. , ^ ^^ By Mr. GILLESPIE: A bill (HJl. 6223) to provide for the use in motor fuels of alcohol manufactured from agricul- tural products grown in the United States; to the Com- mittee on Ways and Means. By Mr. HAS11NGS: A bill (H.R. 6224) to create a body corporate by the name of the Arkansas VaUey Authority, defining its duties, and for other purposes; to the Com- mittee on Flood Control. By Mr. DOBBINS: A bill (H.R. 6225) to authorize appro- priations for construction of buildings, utilities, and appur- tenances thereto for the Air Corps Teclinical School at Chanute Field, HI.; to the Committee on Military Affairs. By Mr. DUNN: A bill (H.R. 6226) to provide $20,000.- 000 000 for the pvirpose of continuing the work which is being done by the Public Works and National Recovery Administrations; to the Committee on Ways and Means. By Mr. HUDDLESTON: A bUl (H.R. 6227) to amend the Radio Act of 1927; to the Committee on Merchant Marine, Radio, and Fisheries. By Mr. SMITH of Virginia: A bill (H.R. 6228) to provide for the appointment of a commission to establish the bound- ary line between the District of Columbia and the Common- wealth of Virginia; to the Committee on the Judiciary. By Mr. McCANDLESS: A bill (H.R. 6229) to repeal Fed- eral liquor prohibition laws to the extent they are in force in the Territory of Hawaii; to the Committee on Ways and Means. By Mr. DICKSTEIN: Resolution (HJles. 198) to authorize special committee to investigate Nazi propaganda activities and certain other propaganda activities; to the Committee on Rules. Also, resolution (H.Res. 199) to authorize payment of ex- penses of investigation authorized by House Resolution 198; to the Committee on Accounts. By Mr. DIMOND: Joint resolution (H.J.Res. 209) author- ising a preliminary examination or survey of Metlakatla Harbor, Alaska; to the Committee on Rivers and Harbors. By Mr. MERRITT: Joint resolution (H.J.Res. 210) direct- ing the Comptroller General to readjust the account be- tween the United States and the State of Connecticut; to the Committee on the Judiciary. By Mr. MAPES: Joint resolution (H.J.Res. 211) proposing an amendment to the Constitution of the United States rela- tive to taxes on certain incomes: to the Committee on the Judiciary. By Mr. BOYLAN: Joint resohition (HJJles. 212) author- izing the selection of a site and the erection of ft pedestal for the statue or memorial to Thomas Jefferson, in the city of Washington, D.C.; to the Committee on the Library. By Mr. COCHRAN of Missouri: Joint resolution (HJJles. 213) authorizing an appropriation for the acquisition of a suitable site and the construction of a permanent memorial to the men who made possible the territorial expansion of the United States, particularly President Jefferson and his aides, who negotiated the Louisiana Purchase, and the great explorers Lewis and Clark, and the hardy hunters, trappers, frontiersmen, and pioneers and others who contributed to the territorial expansion and development of the United States of America; to the Committee on the Library. MEMORIALS Under clause 3 of rule XXTT, memorials were presented and referred as follows: By the SPEAKER: Memorial of the Legislature of the State of Wisconsin, memorializing Congress to grant Federal aid to abolish the inhuman treatment and lynching of Negro prisoners; to the Committee on the Judiciary. Also, memorial of the Legislature of the State of Wiscon- sin, memorializing Congress relative to loans by the Recon- struction Finance Corporation to corporations paylnr exces- sive salaries to officers; to the Committee on Banking and Currency. Also, memorial of the State of Wisconsin, memorializing Congress relative to standards for imported dairy products; to the Committee on Agriculture. Also, memorial of the Legislature of the State of Cali- fornia, memorializing Congress in regard to mirdng claims; to the Committee on Mines and Mining. Also, memorial of the Legislature of the State of Cali- fornia, memoriaUzing Congress to provide relief for the oil industry: to the Committee on Ways and Means. Also, memorial of the Assembly of Habana. Cuba, me- morializing Congress in a protest against North American intervention and asking moral support; to the Committee on Foreign Affairs. Also, memorial of the Legislature of the Territory of Hawaii, memorializing Congress to extend the effect of the twenty-first amendment to the Territory of Hawaii; to the Committee on the Judiciary. Also, memorial of the Legislature of the State of Califor- nia, relative to accepting amendments to permit from the (Sovermnent of the United States for the construction of approach roads over certain rights-of-way leading to the Golden Gate Bridge in the Presidio of San Francisco MiU- tary Reservation, and relating to the retrocession by the Congress of the United States of jurisdiction over said rights- of-way as relocated; to the Committee on Military Affairs. Also, memorial of the Legislature of the State of Arizona, memorializing Congress relative to the early settlers who were deprived of their homes by the confirmation of Spanish land grants; to the Committee on the Public Lands. Also, memorial of the Legislature of the State of Arizona, memorializing Congress relative to disabihty compensation of veterans; to the Committee on World War Veterans' Legislation. ^ ^^ ^ ,* ^ Also, memorial to request the Congress of the United States that the taxes levied by section 211 of Public Law 67 of the Seventy-third Congress be reimbursed to the people of Puerto Rico to be used to further industry and agricui- tm-e, and for the general agrandizement of the island of Puerto Rico, and for other purposes; to the Committee on Ways and Means. Also, memorial of the Legislature of the State of Mary- land protesting against the so-caUed "Prince plan" for uniting the Baltimore & Ohio Raihroad with the Pennsyl- vania Railroad; to the Committee on Interstate. and Foreign Commerce. , .„ Also, memorial of the Legislature of the Stote of Wyommg, memorializing Congress to estabUsh a Federal land-bank dls- ^^■».T/-ii-k-nor«T/^XT i, T T»T?/^/^T>T\ TTATTCl? Taxtttat?v Q ^c^r^A rnMCPFRSTONAT. T^FPORD — HOTTSE 27 an amenomeni lo ine t/onsviiunuu ui mc wuii/cu uv |! I f< M Ik I 26 C0NGRESSI0N7 X RECORD— HOUSE January 3 trict composed of Intermountain States; to the Committee on Banking and Currency. Also, memorial of the Legislature of the SUte of Wiscon- sin, against the removal of Lock and Dam No. 10, Upjer Mississippi River improvement project, from Cassville, W.s.; to the Committee on Rivers and Harbors. Also, memorial of the Legislature of the State of Minjie- sota, memorializing Congress to enact legislation to protect American industry and the employees thereof against ch(ap foreign labor and products; to the Committee on Ways and Means. Also, memorial of the Legislature of the State of Mai tie, recommending that the Federal Government establish an official gateway to Acadia National Park; to the Committee on the Public Lands. Also, memorial of the Legislature of the State of Minne- sota, memorializing Congress to enact legislation preventing the importation of meat products under American namjs; to the Committee on Ways and Means. Also, memorial of the Legislature of the State of Montana, memorializing Congress to enact effective laws prohibiting the producers and distributors of gasoline from establishing unfair and unjust prices for the sale at retail to the people of the United States, and thus removing unjust discriiii- nation; to the Committee on Interstate and Poregn Commerce. Also, memorial of the Legislature of the State of Montai la. memorializing Congress to purchase Montana cattle for distribution to workers on Federal projects and for the relief of the destitute in the State of Montana; to the Commit^e on Agriculture. Also, memorial of the Legislature of the State of Mai^e. recommending that the Federal Government establish official gateway to Acadia National Park; to the Committee on the Public Lands. ee an M. of PRIVATE BILLS AND RESOLUTIONS Under clause 1 of rule XXn, private bills and resolutions were introduced and severally referred as follows; By Mr. WILSON: A bill (H.R. 6230) to extend the msis lire of relief provided in the Employees' Compensation ^ct of September 7. 1916. to Dan O'Sullivan; to the Commit on Claims. By Mr. AYRES of Kansas: A bill (ILR. 6231) granting Increase of pension to James Elmer Mulford; to the Co^n mittee on Pensions. Also, a bill (HJl. 6232) granting a pension to Jessie Warner; to the Committee on Invalid Pensions. Also, a bill (H_R. 6233) granting a pension to Vemie Eli](ier Trout; to the Committee on Inv-ahd Pensions. By Mr. BETTER : A bill (HJl. 6234) for the reUef James J. Serine; to the Committee on Military Affairs. Also, a biU (H-R. 6235) for the relief of Teddy Stepl^en Ormsby; to the Committee on Naval Affairs. Also, a bill (HJl. 6236) for the relief of Chester H. Hcj^p; to the Committee on Naval Affairs. By Mr. BERLIN: A bill (H.R. 6237) granting a pension Miss Malissa Agnes McMunn; to the Committee on Inv^id Pensions. Also, a bm (HJl. 6238) for the relief of M. R. Welty; to ^e Committee on Claims. By Mr. BLOOM: A bill (H.R. 6239) for the relief of l|he heirs of the late Prank J. Simmons; to the Committee War Claims. Also, a bill (HJl. 6240) for the relief of Ernest Jacol^r, deceased: to the Committee on Naval Affairs. Also, a bill (HJl. 6241) conferring jurisdiction upon ^e Court of Claims to hear and determine the claims of V^e International Arms k Fuze Co., Inc.; to the Committee War Claims. Also, a blU (H.R 6242) for the relief of Bugene McG^rr and Rose McOirr; to the Committee on Claims. By Mr. BOYLAN: A bill (H.R. 6243) for the rebef Oeorge Raptis; to the Committee on Claims. to on on of ! By Mr. BROWN of Michigan: A bill (HJl. 6244) granting a pension to Rosa Strlebich; to the Committee on Invahd Pensions. By Mr. BURNHAM: A bill (H.R. 6245) conferring juris- diction upon the Court of Claims to hear and determine the claim of the Mack Copper Co.; to the Committee on War Claims. Also, a bill (H.R. 6246) granting 6 months* pay to Annie Bruce; to the Committee on Naval Affairs. Also, a bill (H.R. 6247) for the relief of Hugh G. Lisk; to the Committee on Claims. Also, a bill (H.R. 6248) for the relief of Harry C. Berto- lucci; to the Committee on Naval Affairs. By Mr. BACHARACH: A bill (H.R. 6249) granting a pen- sion to Jennie R. Scull; to the Committee on Pensions. By Mr. BUCKBEE: A bill (HJl. 6250) granting a pension to Ettie May Smith; to the Committee on Invalid Pensions. Also, a bill (HJl. 6251) for the relief of Ida L. Punston; to the Committee on Claims. By Mr. COCHRAN of Pennsylvania: A bill (H.R. 6252) for the relief of Evila Burdett; to the Committee oh Military Affairs. Also, a bill (H.R. 6253) for the relief of John P. Budke; to the Committee on Military Affairs. Also, a bill (H.R. 6254) for the relief of Abraham J. Petrini; to the Committee on Military Affairs. By Mr. CORNING: A bill (H.R. 6255) for the relief of Bruno Tarzio; to the Commi'tee on Claims. By Mr. CROWTHER: A bill iHJl. 6256^ renewing and extending patent no. 1224108; to the Committee on Patents. Also, a bill (H.R. 6257) granting an increase of pension to Julia Mehlman; to the Committee on Invalid Pensions. Also, a bill (H.R. 6258) granting a pension to Anna T. Walsh; to the Committee on Pensions. By Mr. DELANEY: A bill (H.R. 6259) for the relief of William Patrick Kelly: to the Committee on Naval Affairs. Also, a bill (H.R. C260) for the relief of Anthony J. De Amara; to the Committee on Naval Affairs. By Mr. DIMOND: A bill (H.R. 6261) authorizing the Sec- retary of the Treasury to bestow a gold medal of honor, of such a design as he may approve, upon Chief Boatswain Thomas A. Ross, of the United States Coast Guard station, Nome, Alaska; to the Committee on Military Affairs. By Mr. DUNCAN of Missouri: A bill (H.R. 6262) granting an increase of pension to Lucina Morris; to the Committee on Invalid Pensions. By Mr. EVANS: A bill 'H.R. 6263) to sell, grant, and con- vey, by patent, to the Rio Colorado Supply ti Development Co., a California corporation, a portion of the Colorado River Indian Reservation classified as mesa land and unfit for agriculture, comprising 40 acres, more or less, and occupied by said Rio Colorado Supply & Development Co. under permit during the years 1929, 1930, and 1931; to the Committee on the Public Lands. By Mr. FORD; A bill (H.R. 6264) granting a pension to Katie A. Hoskinson; to the Committee on Invalid Pensions. Also, a bill (H.R. 6265) for the relief of Other Homick; to the Committee on Military Affairs. Also, a bill (H.R. 6266) for the relief of Robert G. Adams; to the Committee on Military Affairs. Also, a bin (H.R. 6267) for the relief of Charles Mullikin; to the Committee on Military Affairs. By Mr. GREHENWOOD: A bill (H.R. 6268) granting; a pen- sion to Katie Glenn; to the Committee on Invalid Pensions. Also, a bill (H.R. 6263) granting a pension to Alice Chumb- ley; to the Committee on Invahd Pensions. Also, a bill (H.R. 6270) granting a pension to Hattie Johnson; to the Committee on Invalid Pensions. Also, a bill (H.R. 6271) granting an increase of pension to John Stringer; to the Committee on Pensions. By Mr. GRISWOLD: A bill (HJl. 6272) for the relief of Anton Wenzel Kaukusch; to the Committee on Navml Affairs. By Mr. HOPE: A bill (H.R. 6273) for the relief of Collin B. Hyatt; to the Committee on Naval Affairs. 1934 CONGRESSIONAL RECORD— HOUSE 27 By Mr. H(X>PER: A bill (H.R. 6274) granting a pension to Cora M. Peters; to the Committee on Invalid Pensions. By Mr. HASTINGS: A bill (H.R. 6275) authorizing and directing that 5 percent of any amount or amounts appro- priated to pay claims of the Cherokee Indians against the United States be paid to Prank J. Boudinot, his heirs or personal representatives, in full for his .services and ex- penses for and on behalf of said Indians prior to July 19. 1923, and for other purposes; to the Committee on Indian By Mr. HAMILTON: A bill (H.R. 6276) for the relief of Jordan B. Gross; to the Committee on Military Affairs. Also, a bill (H.R. 6277) for the relief of Jesse Baird; to the Committee on Claims. Also, a bill (H.R. 6278) for the relief of Joe H. Ross; to the Committee on Military Affairs. Also, a bill (H.R. 6279) granting a pension to Margaret Moore; to the Committee on Invalid Pensions. By Mr. JAMES: A bill (H.R. 6280) for the relief of Michael Ilitz; to the Committee on Military Affairs. By Mr. KNUTSON: A bill (H.R. 6281) granting a pen- sion to Mary E. Allen; to the Committee on Invalid Pensions. Also, a bill (H.R. 6282) for the relief of Robert V. Rensch; to the Committee on Claims. Also, a bill (HJl. 6283) for the relief of Herman H. Orth; to the Committee on Claims. By Mr. KOCIALKOWSKI : A bill (H.R. 6284) for the j relief of John B. Novak; to the Committee on Claims. ! By Mr. LUCE: A bill (H.R. 6285) for the relief of ! M. Grace Murphy; to the Committee on Claims. By Mr. MAPES: A bill (U.K. 6286) for the relief of Lee Cook; to the Committee on Military Affairs. By Mr. MARTIN of Oregon: A bill (H.R. 6287) grant- ing a pension to Grace V. Foster; to the Committee on Pensions. Also, a bill (H.R. 6288) granting an increase of pension to Mary Agnes Hill; to the Committee on Invalid Pensions. By Mr. MEAD: A bill (H.R. 6289) granting an increase of pension to Eliza Matthews; to the Committee on Invalid Pen.sions. Also, a bill (H.R. 6290) granting a pension to Mrs. Eliza- beth Henn'ng; to the Committee on Pensions. Also, a bill (H.R. 6291) for the relief of the widow and children of Samuel P. Preiert, deceased; to the Committee on Military Affairs. By Mr. MERRITT: A bill (H.R. 6292) for the relief of Joseph B. Murphy; to the Committee on Naval Affairs. Also, a bill (H.R. 6293) for the relief of Howard P. Cun- ningham; to the Committee on Military Affairs. Also, a bill (H.R. 6294 > granting a pension to Mary A. Jennings: to the Committee on Invalid Pensions. By Mr. MILLIGAN: A bill (H.R. 6295) granting a pension to Mariah E. Groom; to the Committee on Invalid Pensions. Also, a bill (H.R. 6296) for the relief of Claude Benard Wilson; to the Committee on Claims. Also, a bill (H.R. 6297) granting a pension to Mary C. McKarin; to the Committee on Invalid Pensions. Also, a bill (H.R. 6298) granting a pension to Susan Harder; to the Committee on Invalid Pensions. Also, a bill (H.R. 6299) granting a pension to Daniel P. Glenn; to the Committee on Invalid Pensions. By Mr. RAMSAY: A bill (H.R. 6300) to restore to the Neill Grocery Co., of Wheeling, W.Va., a fine paid for viola- tions of the* Lever Act which was afterward by the Supreme Court of the United States held to be invalid; to the Com- mittee on Claims. By Mr. REECE: A bill (H.R. 6301) for the relief of the heirs of James Kirk; to the Committee on Claims. Also, a bill (H.R. 6302) granting a pension to Mark Tipton; to the Committee on Invalid Pensions. Also, a bill (H.R. 6303) granting a pension to Minnis Wilson; to the Committee on Pensions. Also, a bill (H.R. 6304) gi-anting a pension to Jonah C. Prather; to the Committee on Pensions. Also, a bill (HJl. 6305) granting an increase of pension to Richard Gregg; to the Committee on Pensions. Also, a bUl (HJl. 6306) granthig a pension to Margaret Williams; to the Committee on Pensions. Also, a bUl (H.R. 6307) granting a pension to Sarah C. Hilton; to the Committee on Pensions. Also, a bill (HJl. 6308) granting a pension to Paul Hol- comb; to the Committee on Pensions. Also, a bill (H.R. 6309) granting a pension to Wilbum G. Sparks; to the Committee on Pensions. Also, a bill (H.R. 6310) granting a pension to Dessie M. Treadway; to the Committee on Pensions. By Mr. RICH: A bill (H.R. 6311) granting a pension to Hazel Stover; to the Committee on Pensions. By Mr. RUDD: A bill (HJl. 6312) granting a pen;rion to Margaret T. McLaughlin; to the Committee on Invalid Pensions. By Mr. SABATH: A bill (HJl. 6313) for the relief of Plorenz Gutierrez; to the Committee on Claims. Also, a bill (HJl. 6314) for the relief of Josephine Matson: to the Committee on Claims. Also, a bill (H.R. 6315) for the reUef of the legal repre- sentatives of the late Alvina Schallhorn; to the Committee on Cla'ms. By Mr. SMITH of Washington: A bill (HJl. 6316) for the relief of John E. HoUe; to the Committee on Military Affairs. Also, a bill (H.R. 6317) for the relief of A. E. Clark: to the Committee on Claims. By Mr. SMITH of West Virginia: A bill (HJl. 6318) for the relief of Louis C. Runyon; to the Committee on Military Affairs. Also, a bill (H.R. 6319) for the relief of William G. Hub- bard II, alias Andrew Pahner; to the Committee on Naval Affairs. Also, a bill (HJl. 6320) granting a pension to William B. Mullins; to the Committee on Invalid Pensions. A130, a bill (H.R. 6321) granting a pension to Alice B. Cook; to the Committee on Pensions. By Mr. SNELL: A bill (H.R. 6322) for the relief of Lillian N. Lanphear; to the Committee on Claims. By Mr. STOKES: A bill (HJl. 6323) for the reUef of Emma L. Albrecht; to the Committee on Foreign Affairs. Also, a bill (HJl. 6324) for the reUef of Mabel Carver; to the Committee on Claims. Also, a bill (H.R. 6325) for the reUef of Mary Robinson: to the Committee on Claims. Also, a bill (HJl. 6326) for the relief of Ralph R. Cun- ningham; to the Committee on Military Affairs. Also, a bill (H.R. 6327) granting a pension to Emella Proskauer; to the Committee on InvaUd Pensions. Also, a bill (HJl. 6328) for the rehef of John P. Mc- Donough; to the Committee on Military Affairs. Also, a bill (HJl. 6329) granting a pension to Esther Simp- son Bingham; to the Committee on Invalid Pensions. By Mr. SUTPHIN: A bill (H.R. 6330) granting an increase of pension to George M. Purdy; to the Committee on Pen- sions. By Mr. SWANK: A bill (HJl. 6331) granting a pension to Minnie Cantlon; to the Committee on Pensions. Also, a bill (H.R. 6332) granting a pension to Henry Wink- ler ; to the Committee on Pensions. Also, a bill (H.R. 6333) for the relief of Samuel G. David- son; to the Committee on Military Affairs. Also, a bill (H.R. 6334) for the relief of James Edgar Goad. Jr. ; to the Committee on Naval Affairs. Also, a bill (H.R. 6335) for the relief of Jack H. Straight: to the Committee on Naval Affairs. Also, a bill (H.R. 6336) for the relief of George Tempy: to the Committee on Military Affairs. Also, a bill (H.R. 6337) for the rel ef of Edward Perming- ton ; to the Committee on Military Af!;airs. Also, a bill (H.R. 6338) for the relief of John Box; to the Committee on MiliUry Affairs. Also, a bill (HJIW339) for the relief of John R. Thigpen; to the Committee on Military Affairs. Also, a bill (H.R. 6340) granting a pension to Sarah E. Wilkerson; to the Committee on Invalid Pensions. i J i til 28 CONGRESSIONAL RECORD—HOUSE the to Also, a bill ^H-R. 6341) granting a pension to Marr E. Price; to the Committee on Invalid Pensions. Also, a bill (HJl. 6342) for the reUef of Caesar F. Sim- mons; to the Committee on Claims. Also, a bill (HJl. 6343) to extend the benefits of Employees' Compensation Act of September 7, 1916 Maude R. Crawford, widow of Williaiii M. Crawforl, a former special disbursing officer with the Indian office at Pawhuska. Okla.; to the Committee on Claims. Also, a biU (H.R. 6344) for the relief of George louis Dynes; to the Committee on Military Affairs. Also, a bill (HJi. 6345) for the reUef of Earnest B. Ciirle- ton; to the Committee on Military Affairs. Also, a bill (HJl. 6346) granting a pension to Eliia J. Mason; to the Committee on Invalid Pensions. Also, a bill (HJl. 6347) granting a pension to Edith M. Bennett; to the Committee on Invalid Pensions. By Mr. TARVER: A bill (HJl. 6348) granting a persion to Mary F. Shields; to the Committee on Invalid Pensions. By Mr. THOMPSON of Illinois: A bill (HJl. 6349 1 to confer Jurisdiction upon the Court of Claims to hear, de- termine, and render judgment upon the claim of the Velie Motors Corporation; to the Committee on War Claims. By Mr. UTTERBACK: A bill (HJl. 6350) for the relief of Arthur Smith; to the Committee on Claims. By Mr. STOKES: A bill (HJl. 6351) for the relief of Thomas H. McLain; to the Committee on Claims. By Mr. WEST of Ohio: A bill (H.R. 6352) grantini an increase of pension to Amelia Matheny; to the Committee on Invalid Pensions. By Mr. WIGGLESWORTH : A bill (HJl. 6353) for the relief of John J. O'Connor; to the Committee on Military Affairs. 1 Also, a bill (HJl. 6354) to extend the benefits of the Em- ployees' Compensation Act of September 7, 1916, to Cail G. Lindstrom, a former employee at the Watertown Arsj^nal, Watertown, Mass.; to the Committee on Claims. January 3 PETITIONS. ETC. Under clause 1 of rule XXII. petitions and papers ^ere laid on the Clerk's desk and referred as follows: 1404. By Mr. BURNHAM: Petition signed by 41 residents of San Diego. Calif., urging the restoration of pensions, hospitalization, and care of Spanish-American War veter- ans, as same existed prior to the enactment of Public, No. 2. Seventy-third Congress; to the Committee on Pensions. 1405. Also, petition signed by 109 residents of San Diego, Calif., urging the restoration of pensions, hospitalization, and care of veterans of the Spanish-American War, as sfime existed prior to the enactment of Public, No. 2. Sevetity- third Congress; to the Committee on Pensions. 1406. Also, petition signed by 650 registered voter; of San Diego, Calif., urging restoration of pensions, hospi ali- zation. and care of veterans of Spanish-American Wai. as same existed prior to the enactment of Public Law 2, I Sev- enty-third Congress; to the Committee on Pensions. 1407. By Mr. JOHNSON of Texas: Resolution adopted by the Legislature of the State of Texas opposing Senate bill 165«. being the so-called "Duck stamp bill"; to the Com- mittee on Agriculture. 1408. By Mr. LINDSAY: Petition of National Legislitive Council of Federal Employee Organizations, Washington, D.C., urging immediate restoration of basic-pay rates; tc the Committee on Appropriations. 1409. Also, petition of New York State League of Savings and Loan Associations. New York City, recommending the Appointment to membership on the Federal Home loan Bank Board of a person experienced in the maiuigemer t of savings and loan institutions; to the Conunittee on Banking and Currency. 1410. Also, petition of Pittsburgh Central Labor Uiion, Pittsburgh. Pa., urging early repeal of title 2 of the Ec6n amy Act; to the Committee on Appropriations. 1411. Also, petition of United Spanish War Veterans, Topeka, BZans., urging repeal of the Economy Act; to the Csmmittee on Appropriation^. 1412. Also, petition of Peoria Camp. No. 49, United Span- ish War Veterans, Peoria, 111., concerning restoration of their former pension status; to the Committee on Invalid Pensions. 1413. Also, petition of Clark Mills Marr Camp. No. 26, United Spanish War Veterans. Galesburg. HI., concerning reestablishing the status of Spanish War veterans; to the Committee on Invalid Pensions. 1414. Also, petition of Charles D. McCoy Camp, No. 28, United Spanish War Veterans. Vincennes. Ind.. concerning repeal of the Economy Act and reinstatement of veterans under original pension law; to the Committee on Appro- priations. 1415. Also, petition of Welch, Holme L Clark Co., Inc., New York City, concerning the so-called " Tugwell bill "; to the Committee on Agriculture. 1416. Also, petition of P. N. Burt, Ltd., Buffalo. N.Y.. op- posing the so-called "Tugwell bill"; to the Committee on Agriculture. 1417. Also, petition of Vessel Owners and Captains' Asso- ciation, Philadelphia, urging the construction and mainte- nance by the United States Goverrunent of a safe and suit- able harbor of refuge at Assateague Harbor; to the Com- mittee on Rivers and Harbors. 1418. Also, petition of Bernarr Macfadden. publisher. New York City, concerning the so-called "Tugwell bill"; to the Committee on Agriculture. 1419. Also, petition of the Chamber of Commerce of the State of New York. New York City, favoring moderate taxa- tion of alcoholic beverages; to the Committee on Wayj and Means. 1420. Also, petition of Townes & James, Inc.. Brooklyn, N.Y., wholesale druggists, opposing House bill 6110; to the Committee on Interstate and Foreign Commerce. 1421. Also, petition of Railroad Employees National Pension Association, Inc., favoring the passage of the Hat- field-Keller bill; to the Committee on Pensions. 1422. Also, petition of the Baker Castor Oil Co., New York, protesting against the enactment of Senate bill 1944; to the Committee on Interstate and Foreign Commerce. 1423. By Mr. RUDD: Petition of Railroad Employ ges Na- tional Pension Association, Inc., Minneapolis, Minn., favor- ing the passage of the Hatfield-Keller bill. S. 817 and H.R. 4231; to the Committee on Interstate and Foreign Commerce. 1424. Also, petition of Chamber of Commerce of the State of New York with reference to taxation of alcoholic bever- ages; to the Committee on Ways and Means. 1425. Also, petition of Capt. Starr C. Wardrop Post, No. 40, Veterans of Foreign Wars of the United States, Balboa, Canal Zone; to the Committee on World War Veterans' Legislation. 1426. Also, petition of N. W. Embry, vice president. Gen- eral Box Co., Inc.. 151 Kent Avenue, Brooklyn, NY., favor- ing a duty on boxes in which bottled liquor is shipped into the United States from foreign countries and made in for- eign countries; to the Committee on Ways and Means. 1427. Also, petition of Pittsburgh Central Labor Union, Pittsburgh. Pa., favoring the repeal of title 2 of the Economy Act: to the Committee on Appropriations. 1428. Also, petition of New York State League of Savings and Loan Associations. New York City, favoring a certain person to membership of the Federal Home Loan Bank Board; to the Committee on Banking and Currency. 1429. Also, petition of Chamber of Commerce of the Borough of Queens, city of New York, favoring the repeal of the law providing a permanent plan for the Federal guarantee of bank deposits; to the Committee on Banking and Currency. 1430. Also, petition of Chamber of Commerce of the Borough of Queens, city of New York, advocating the return of a stabilized monetary policy; to the Committee on Bank- ing and Currency. 1431. Also, petition of National Legislative Council of Fed- eral Employee Organizations, Washington. D.C., favoting immediate restoration of basic pay rates^ elimination of cost of living as the determining factor in Federal pay adjust- 1934 CONGRESSIONAL RECORD— SENATE 29 ment. and restoration of conditions existing June 30, 1932: to the Committee on Appropriations. 1432. Also, petition of Charles D. McCoy Camp, No. 28, Department of Indiana, Vincennes, Ind., favoring the repeal of the Economy Act with reference to the veterans; to the Committee on World War Veterans' Legislation. 1433. Also, petition of the Carbon Dioxide Institute, Inc. New York City, opposing the existing tax on carbonic gas used for carbonating beverages; to the Committee on Ways and Means. 1434. Also, petition of Recovery Associates of Woodhaven. 78-01 Jamaica Avenue. Woodhaven, Long Island. N.Y., heartily endorsing, favoring, and commending the efforts of the President to bring about necessary changes in our mone- tary system in the interest of the common good; to the Com- mittee on Banking and Currency. 1435. Also, petition of Welch, Holme & Clark Co., Inc., opposing the passage of the Tugwell biUs; to the Committee on Agriculture. 1436. Also, petition of F. N. Burt Co., Ltd., Buffalo. N.Y., opposing the so-called "Tugwell bills"; to the Committee on Agriculture. 1437. Also, petition of Malcolm D. Gray. 1910 Glenwood Read. Brooklyn. N.Y.. opposing the passage of the so-called "Tugv.-ell bill"; to the Committee on Agriculture. 1438. Also, petition of the Baker Castor Oil Co., New York City, opposing the passage of Senate bill 1944; to the Com- mittee on Interstate and Foreign Commerce. 1439. Also, petition of the State of New York Conservation Department, Albany, N.Y.. favoring the passage of House Resolution 173, providing for the creation of a new House committee to which would be referred House bills pertaining to fi.'h and game; to the Committee on Rules. 1440. By Mr. SUTPHIN: Petition of the Mayor and Coun- cil of the Borough of Matawan, N.J., approving the con- struction of the proposed ship canal across the State of New Jersey: to the Committee on Rivers and Harbors. 1441. By Mr. CARTER: Petition of W. J. Hutchison and other Spani.'^^h War veterans; to the Committee on Economy. 1442. By the SPEAKER: Petition of Ignacio Rosario et al., regardmg the safety, comfort, etc., of the citizens of Puerto Rico: to the Committee on Ways and Means. 1443. Also, petition of Addie L. Robinson, T. Calvin Cren- shaw, et al., regarding an inquiry into the infringement of patent rights of the aforementioned petitioners; to the Com- mittee on the Judiciary. 1444. Also, petition of the Pampangan Circle of Chicago, 111., regarding the reconsideration by Congress of the Hare- Hawes-Cutting bill for modification; to the Committee on Insular Affairs. 1445. Also, petition of the Teachers' College of Columbia University, regarding the condition of American schools; to the Committee on Education. 1446. Also, petition of Nemesio Y. D. Roca, regarding the independence of the Philippine Islands; to the Committee on Insular Affairs. 1447. Also, petition of the Philadelphia Pediatric Society, relative to restrictions based on racial origin imposed on its physicians by the German Nation; to the Committee on Foreign Affairs. 1448. Also, petition of the National Association of State Auditors, Comptrollers, and Treasurers, relative to taking an agricultural census for 1925 and each succeeding decade thereafter; to the Committee on the Census. 1449. Also, petition of the Textile Foundation, relative to research work in textile products; to the Committee on Interstate and Foreign Commerce. 1450. Also, petition of Manuel L. Luminario. relative to the extension of the benefits of the Army pension law to the • hou.seboys of American Army officers who served during the Spanish- American War in the Philippine Islands; to the Committee on Pensions. 1451. Also, petition of the city of Madison, Wis., relative to the issuance of municipal bonds; to the Committee on Banking and Currency. 1452. Also, petition of the city of Milwaukee. Wis., request- ing rescinding of act creating stringent regulations for the national soldiers' homes; to the Committee on Expenditures in the Executive Departments. 1453. Also, petition of the Commission Council of the City of New Orleans, La., relative to the granting of Public Works funds for the completion of the industrial canal from the Mississippi River to Lake Pontchartrain ; to the Com- mittee on Ways and Means. 1454. Also, petition of the city of Portland, Oreg., relative to the development of the Colimibia River hydroelectric project; to the Committee on Rivers and Harbors. 1455. Also, petition of the American Medical Association, regarding the construction of new buildings to house the Army medical library and museum; to the Conunittee on Military Affairs. 1456. By Mr. SEGER: Petition of New Jersey Bankers As- sociation, for sound currency; to the Committee on Banking and Currency. 1457. Also, petition of New Jersey League of Municipalities, urging consideration of the purchase of tax-anticipation or tax-delinquency certificates through the Reconstruction Finance Corporation; to the Committee on Ways and Means. 1458. Also, petition of Associated Outdoor Advertisers of New Jersey, protesting against the Tugwell bill; to the Com- mittee on Agriculture. 1459. Also, joint resolution of New Jersey State Legislature, relative to presence of Dutch elm disease in this country and need for its extermination; to the Committee on Agriculture. SENATE Thursday, January 4, 1934 The Chaplain, Rev. ZeBarney T. Phillips, DJD., offered the following prayer: Dear Lord and Father of mankind, who hast clothed the universe with beauty, at whose command the mom doth rise to reawake the world and night descends to deck her brow with stars: Unlock the springs of mind, illume and purify our souls with inward light that honest thought and rever- ent speech may here prevail, and crown our day with deeds essential to the Nation's weal. Bestow on everyone Thy sleepless care; where sorrow dwells, there let Thy dews of mercy fall; and grant that hope and faith triumphant may lead Thy children through the world until the unborn years shall bring the promised day divine. We ask it in the name of Him who is the day- spring from on high. Jesus Christ our Lord. Amen. Thomas D. Schall. a Senator from the State of Minnesota, appeared in his seat today. THE JOURNAL The Chief Clerk proceeded to read the Journal of yester- day's proceedings, when, on request of Mr. Robinson of Arkansas and by unanimous consent, the further reading was dispensed with and the Journal was approved. MESSAGE FBOM THE HOUSE A message from the House of Representatives, by Mr, Chaffee, one of its clerks, communicated to the Senate the intelligence of the death of Hon. Edward B. Almon, late a Representative from the State of Alabama, and transmitted the resolutions of the House thereon. The message also commimicated to the Senate the intel- ligence of the death of Hon. James S. Parker, late a Rep- resentative from the State of New York, and transmitted the resolutions of the House thereon. The message also commimicated to the Senate the intel- ligence of the death of Hon. Bolivar E. Kemp, late a Rep- resentative from the State of Louisiana, and transmitted the resolutions of the House thereon. The message also communicated to the Senate the intel- ligence of the death of Hon. Lynn S. HoRNoa,.late a Rep- 1 \ 1 i 30 1^ Ifi CONGRESSIONAL RECORD— SENATE January 4 rcsentative from the State of West Virginia, and transmitted the resolutions of the House thereon. Tlie message also communicated to the Senate the intel- ligence of the death of Hon. John D. Clarki. late a Pep- resentative from the State of New York, and transmi ted the resolutions of the House thereon. i The message also commimicated to the Senate the irijtel- ligence of the death of Hon. Htnry W. Watson, late a Rep- resentative from the State of Pennsylvania, and transmit ;ted the resolutions of the House thereon. "nje message further communicated to the Senate r (so- lutions adopted by the House as a tribute to the menory of Hon. John B. Kknskick. late a Senator from the siate of Wyoming. ] The message also communicated to the Senate resolut: ons adopted by the House as a tribute to the memory of I [on. PoRxn H. Daue. late a Senator from the State of Vermont. MKSSAGES FROlf THX PRXSIOENT Messages in writing from the President of the United States were communicated to the Senate by Mr. Latta. one of bis secretaries. CALL OP THE ROLL Mr. LEWIS. I suggest the absence of a quorum, and a^ for a roll call. The VICE PRESIDENT. The clerk will call the roll. The legislative clerk called the roll, and the following Senators answered to their names: AdAins Costlgan Jobnaon Reed Aatiunt Couzena Kean Reynolds Austin Cuttlnc Keyes RobUuon. Ark. Bachman OavU King Roblnion. In^ Bailey Dlcklnaon La Potlette RixBsell BanlLhead Dleterlcb Lewts Schall Barbour Dill Logan Sheppwrd Barkley Duffy Lonergan Ghlpstead Black Ertckson Long Smith Bone Pess McAdoo Stelwer Borab Hetcher licCarran Tbomas. Okli . Brown Frazler McGUl Thomas, Uta% Bulkley George McKnllar Thompson Bulov Gibson McNary Townsend Byrd Glass Murphy Trammell Byrnes Goldsborougb Neely Tydlngs Capper Gore Norrls Vandenberg Caraway Hale Nye Van Nuys Carey Harrison O'BCahoney Wagner Clark Hastings Overton Walcott Connally Hatch Patterson Walsh Cooltdge Hayden Plttman Wheeler Copeland Hebert I>ope White Mr. HEBERT. I desire to announce that my colleague the senior Senator from Rhode Island [Mr. Metcalp], the Senator from South Dakota [Mr. Nokbeck], and the S^na- tor trom West Virginia [Mr. Hatpield] are necessarily ab- sent from the Senate. I ask that this announcement piay stand for the day. Mr. LEWIS. I desire to announce that the Senator ik-om Mississippi [Mr. Stephens] is necessarily detained from the Senate. The VICE PRESIDENT. Ninety-two Senators have an- swered to their names. A quorum is present. COMMrrTEE SERVICE Mr. ROBINSON of Arkansas. I ask that the order! re- specting conunittee assignments which I present and senid to the desk may be entered. The VICE PRESIDENT. The order wiU be read. The legislative clerk read as follows: Ordered. That the Senator from Illinois, Mr. EhcmicH be aaalgced to service on the Committee on the Judiciary; that the Senator from New York. Mr. Wagner, be exciised from further service on the Committee on Patents, and that he be assign* tl to the chalrman&hlp of the Committee on Public Lands and Suri eys that the Senator from Colorado. Mr. Adams, be aseigned to the cbalrmansliip of the Conunittee on Irrigation and Reclamation that the Senator from California. Mr. McAooo. be assignee I to aervlce on the Committee on Patents and made chairman thei eof that the Senator from Massachusetts. Mr. Cooudcs. be assigned to service on the Committee on Indian Affairs; that the Seii ator from Alabama. Mr Bankhcao. be assigned to service on the Com- mittee on Appropriations: that the Senator from TennesseeTlMr. Bacrman. be assigned to service on the Committee to Audit and Control the ConUnsent Expenses of the Senate; that the Senator trom Alabama. Mr. Black, be assigned to service on the Com- mittee on Printing: that the Senator from New Mexico. Mr. Hxktr, be aaslgned to service on the Committees on Agriculture and Por- estry. Interstate Commerce. Irrigation and Reclamation, Indian Affairs. Privileges and Elections, and Public Lands and Surveys; and that the Senator from Wyoming, Mr. O'MAHO.vrT. be aaslgned to service on the Committees on Appropriations. Post Offices and Poet Roads. Indian Affairs, Irrigation and Reclamation, and Public Lands and Surveys. TTie VICE PRESIDENT. Without objection, the order is entered. ACKNOWLEDGMENT OP PLORAL TRIBUTES TO LATE SENATORS DALE AND KENDRICK The VICE PRESIDENT laid before the Senate communi- cations from the families of the late Senators Porter H. Dale, of Vermont, and John B. Kendrick. of Wyoming, expressing their gratitude for and appreciation of the floral tributes sent by the Senate, which were ordered to lie on the table. THE BUDGET — MESSAGE PROM THE PRESIDENT The VICE PRESIDENT. The Chair lays before the Sen- ate a message from the President of the United States, which will be read. The legislative clerk read the message, as follows: To the Congress of the United States: \ I transmit herewith the Budget for the year ending June 30, 1935. It contains also estimates of receipts and ex- penditures for the current year ending June 30, 1934. and includes statements of the financial operations or status of all governmental agencies, including the Reconstruction Finance Corporation. The estimates herein given and in- cluded in the Budget have to do with general and special funds — the Government's moneys. They do not relate to tnist and contributed funds, which are not Government moneys, except where expressly referred to as such. CEMSaAL FINANCIAL POSITION In my annual message to the Congress I have already summarized the problems presented by the deflationary forces of the depression, the paralyzed condition which af- fected the banking system, business, agriculture, trans- portation, and, indeed, thf whole orderly continuation of the Nation's social and economic system. I have outlined the steps taken since last March for the resumption of normal activities and the restoration of the credit of the Grovemment. Of necessity these many measures have caused spending by the Government far in excess of the income of the Government. The results of expenditures already made show them- selves in concrete form in better prices for farm commodi- ties, in renewed business activity, in increased employment, in reopening of and restored confidence in banks, and in well -organized relief. THE CURRENT FISCAL TEAR (Ending June 30. 1934) Exclusive of debt retirement of $488,171,500 for this year, Budget estimates of expenditures, including operating ex- penses of the regular Government establishments and also all expenditures which may be broadly classed as caused by the necessity for recovery from the depression will amount this year (ending June 30, 1934) to $9,403,006,967. (See Budget Statement No. 3, table A.) This total falls in broad terms into the following classifications: , Expenditures for fiscal year ending June 30, 1934 General ; Departmental $2, 899. 116. 200 Legislative 17. 718, 500 Independent establishments 616,867,067 3.533.691.767 Leas pubUc-debt retirements 488,171,500 Total, general 3.045.520.267 Emergency : Public Works Administration 1,677.190.800 Agricultural Adjustment Administration 103.250.000 Farm Credit Administration 40.000,000 Emergency Conservation Work 341,705. "JOO Reconstruction Finance Corporation 3,969,740,300 1934 CONGRESSIONAL RECORD— SENATE 31 Expeiuliturea for fiscal year ending June 30, 1934 — Continued Emergency — Continued Tennessee Valley Authority _ $19,000,000 Federal land banks 52.350,000 Federal Deposit Insurance Corporation 153,000.000 National Industrial Recovery Administration. _ 4.250,000 Total, emergency 6,357,436,700 Total, general and emergency, less public- debt retirements 9,403,006,967 As against these expenditures, which have either been appropriated for or for which appropriations are asked, the estimated receipts for this fiscal year (ending June 30, 1934) are $3,259,938,756. (See Budget Statement No. 2, table A.) On this basis, including, however, certain additional ex- penditures for 1934 which are not included in the Budget estimates but which I believe to be necessary and amount- ing to $1,166,000,000 as shown in a subsequent table herein, the excess of expenditures over receipts will be $7,309,068,211. Interest charges on the borrowings in excess of Budget estimates will slightly increase this figure. On the basis of these estimates, the public debt, in the strict sense of the term, at the expiration of this fiscfil year will therefore amount to approximately $29,847,000,000, or an increase as shown above of $7,309,068,211. However, as against this increase in the total debt figure, it is right to point out that the various governmental agencies have loans outstanding with a book value of $3,558,516,189 against which collateral or assets have been pledged. In order to make clear to the Congress what our bor- rowing problem is for the next 6 months, permit me to remind you that we shall have to borrow approximately $6,000,000,000 of new money and, in addition, $4,000,000,000 to meet maturities of a like amount. THE FISCAL TEAR 1035 (Ending June 30, 1935) The Budget estimates of expenditures, exclusive of debt retirement of $525,763,800. and exclusive also of such sum as may be necessary for new and extraordinary recovery purposes, for the fiscal year ending June 30, 1935, amount to $3,960,798,700. Again summarizing the main headings of these expendi- tures they fall into the following items: Expenditures for fiscal year ending June 30, 1935 General : Departmental ^3, 202. 074, 900 Legislative 18, 734, 500 Independent establishments 542,466,600 Less public-debt retirements. 3, 763, 276, 000 525,763,800 Total, general — 3. 237. 512, 200 Emergency : Public Works Administration 1, 089, 883, 100 Agricultural Adjustment Administration 5,000,000 Emergency conservation work 65,190,000 Reconstruction Finance Corporation MBO. 436, 600 Tennessee VaUey Authority. 31,000,000 Federal land banks... - 12,650,000 Total, emergency. 723, 286, 500 Total, general and emergency, less public- debt retirements 3, 960, 798, 700 It will be noted that many of these items, such as public works, fall under appropriations made in 1933, the actual expenditures not taking place until after June 30, 1934. (For details of above expenditures see Budget Statement No. 3, table A.) The above figures do not include additional loans by the Reconstruction Finance Corporation, If its loaning au- thority is extended beyond June 30, 1934. it is contemplated that any additional loans by it would thereafter be taken from the new and additional recovery fund hereinafter referred to. The estimates of receipts for the next fiscal year (ending June 30, 1935), exclusive of foreign-debt payments, of in- creased liquor taxes, and of increased revenue flowing from amendments to the existing revenue law, amount to $3,974,665,479. (See Budget Statement No. 2. table A.) Therefore, exclusive of debt retirement, these Budget esti- mates for the next fiscal year show a small surplus Df $13,866,779. But it must be borne in mind that this sur- plus does not include any additional expenditures for extraordinary recovery purposes. It is clear that the necessity for relief and recovery will still be with us during the year 1934-35. Additional reUef funds will be necessary. Further needs of the country pro- hibit the abrupt termination of the recovery program. No person can on this date definitely predict the total amount that will be needed, nor the itemizing of such an amount. It is my best judgment at this time that a total appropriation of not to exceed $2,000,000,000 will, with the expenditures still to be made next year out of existing appropriations, be sufficient. I shall therefore ask the Congress for appropriations ap- proximating that amount. This amount is not included in the Budget estimates. If appropriated and expended, therefore, it will change the small estimated surplus of $13,000,000 into a debt increase of nearly $2,000,000,000. It is only fair, of course, to say that such a debt increase would be partially oflse^ by loans made against collateral and assets pledged. Therefore, the total debt, if increased by the sum of $2,000,000,000 during the fiscal year 1935, would amount to approximately $31,834,000,000 on June 30, 1935. It is my belief that so far as we can make estimates with our present knowledge, the Government should seek to hold the total debt within this amount. Furthermore, the Qovemment during the balance of this calendar year should plan to bring its 1936 expenditures, including recovery and relief, within the revenues expected in the fiscal year 1936. Let me put it another way: The excess of expenditures over receipts during this fiscal year amounts to over $7,000,000,000. My estimates for the coming fiscal year show an excess of expenditures over receipts of $2,000,000,000. We should plan to have a definitely balanced Budget for the third year of recovery and from that time on seek a continuing reduction of the national debt. This excess of expenditures over revenues, amoimting to over $9,000,000,000 during 2 fiscal years, has been rendered necessary to bring the country to a sound condition after the unexampled crisis which we encountered last spring. It is a large amount, but the unmeasurable benefits justify the cost. The following table shows expenditures and receipts for the fiscal years 1934 and 1935 as contained in the Budget, plus the additional expenditures which will be made out of additional authorizations and appropriations here recom- mended. It shows, also, the estimated increase In the public debt and the book value of assets held as security against loans: Receipts ' Exr^nditures (exclusive of debt retire- "'oeneral — ! 2.530.720.207 Z48«.768,a00 5.017,«8,4«7 1 These estimates of receipts are predicated on Federal Reserve Board aversfca index of industrial production of 81 for fiscal year 1104 and of « lor the fiscal year lVi5: ^ Excess of credits — deduct. 1929. 1930. 1931. 1932. 1933. 1934. 1935. Calendar year average 119 00 81 M •76 »M Fiscal year sverac* 118 UO 87 70 «7 »81 »98 • Purlially estimated. »£stiuuted. I-- 32 CONGRESSIO ^lAL RECORD— SENATE Eipenditares feiriu«i»e o( debt re- tlrBtnent > — Cont inuetl. A^icultur*! Adiusuacnt Admio- Btrafion . — EBMrsaoey * . . in* i«u AddttioiMl npcDdttoTM tnaa •dditiooAl kppropriatioos. ToUl npenditurcB. Inmmae in debt ' Eftimatad book Tftlue of Mnts bald u Mcurity (or Imia $514. 800. 000 «. 357. ««. 700 g, 403.008.007 1, iflA.ooo.oao 10. Sfl0. 00ft. M7 7.308.088,311 M $750,744,000 '$1 773.298.500 7, 3,«0.7«.700 13, 2,000.000,000 ; 3, 5.980.798.700 16, T.«8,133,221 »i •TbBM Include net eTpenditures after deducting Reconstruction Finiiioe Corpo- "JthiTS^SS. 'U'l^dudf «^iJSnt H.binti« such ^ Reconstruct on rinance Corporation debentures issued to banlts and other institutions. January 4 MiperkKl »5. 544. 000 080.773.300 363.805.887 168,000,000 529. M6, 867 2K, 201. 433 481.980,273 S* A APPKOPKIATIOM8 The Budget estimates of appropriations for 19311, cxclu- ■Ive of Agricultural Adjustment Administration ben sflt pay- menU and refimds of processing taxes, but inclusive of all other appropriations for regular departments and inde- pendent establishments including interest on the debt and debt retirement are $2,980,293,833.60. When compared with Budget estimates of appropriaUons transmitted in i he Bud- get for 1934 they show a reduction of $684,913,167 A tabular comparative summary of receipts, estim ates, ap- propriations, and expenditures, classified according to gen- eral and emergency items and listed by departments and under other general heads, appears in Budget S^tement No. 1. Uble B. The estimates of receipts take no account of ttie addi- tional revenue which may be obtained from an increase in liquor taxes and from the proposed changes in the| income- tax law. Since neither of these tax measures has ^ome be- fore Congress as yet, no accurate estimate can bei made of their srield. However, if, as proposed by the Comihittee on Ways and Means, the tax on distilled spirits is increased from $1.10 a gallon to $2 a gallon, and the rates if tax on wines are also increased, the estimated revenue woxild be in- creased by approximately $50,000,000. assuming t aat con- sumption is not affected by additional gallonage (axes im- posed by the States. Considerable additional revenue can also be secured from administrative changes in th< income- tax law, which may amount to as much as $150,0< 0,000 for a full year. The estimates for the Post Office Department are predi- cated upon a continuation of the 3-cent postal rate for nonlocal mail. It is highly important that this rat e be con- tinued. I recommend its continuance. ■COHOMT UCCISI.ATI01f The estimates of appropriations submitted in tHe Budget are predicated on the continuation of certain economy legis- lative provisions which I ask to be enacted and which are appended hereto. The most important is that kaving to do with reduction of compensation of Federal employees. It is eminently fair that, the cost of living having fallen as comi>ared with 1928. the employees of the Government sus- tain some reduction in compensation. This is nat incon- sistent with our policy of advocating an increase ii: wages in industry. For waives there had fallen far beyond a ay reduc- tion contemplated for Federal employees and in m( tst grades are even now substantially below compensation paid Fed- eral employees under the maximum reduction of lo percent. Among the legislative provisions appended hereto is one pn^biting automatic increases in compensation except in the Army, Navy, and Marine Corps. The personn€ I of these three services are engaged in a life service to their country. Some, by reason of the pay freezes, have sustained reduction In compensation of more than 25 percent. They are, there- fore, in a different category from thcBe in othe- govern- mental agencies. They should, in 1935. be releasee from the restrictions on automatic increases in compensatio l V0HT9OL Up to now there has been no coordinated control over emergency expenditures. Today, by Executive order. I have imposed that necessary control in the Bureau of the Budget. Heretofore, emergency expenditures have not been sub- ject to audit by the Comptroller General of the General Ac- counting Office. Today I am. by Executive order, reposing in him the authority to conduct such an audit and to con- tinue to audit each such expenditure. Hereafter, therefore, just as in the departmental expenditures, there will be, in emergency expenditures, a pre-Budget and a post audit. By reason of the fact that the Bureau of the Budget has had no control in the p&rt over the various expenditures. obUgations. and allotments made by the emergency organiza- tions, the task of preparing the present Budget has been the most difficult one since the Budget and Accounting Act went into effect in 1921. These difficulties, in future years, will be substantially miniriized by the control which I have It is evident to me. as I im sure it is evident to you. that powerful forces for recovery exist. It is by laying a founda- tion of confidence in the present and faith in the future that the upturn which we have so far seen will become cumula- tive. The cornerstone of this foundation is the good credit of the Government. It is. therefore, not strange nor Is it academic that this credit has a profound effect upon the confidence so neces- sary to permit the new recovery to develop Into maturity. If we maintain the course I have outlined, we can con- fidently look forward to cumulative beneficial forces repre- sented by increased volume of business, more general profit, greater employment, a diminution of relief expenditures, larger governmental receipts and repayments, and greater human happiness. Franklin D. Roosevelt. Janttary 3. 1934. ALTERNATE ARRANGEMENT OF APPROPRIATION ESTIMATES FOR THE BUREAU OF INDIAN AFF.MRS The VICE PRESIDENT laid before the Senate a message from the President of the United States, which was read, and, with the accompanying paper, referred to the Com- mittee on Appropriations: To the Congress of the United States: I transmit herewith for the consideration of Congress, pursuant to the provisions of the act of March 2, 1933 (Pub- lic 410, 72d Cong.), an alternate arrangement of the esti- mates of appropriations for the Bureau of Indian Affairs. Department of the Interior, for the fiscal year 1935. The details of this alternate arrangement of the estimates are set forth in the letter of the Director of the Bureau of the Budget, which is transmitted herewith, and with which I concur. Franklin D. Roosevelt. The White House, January 3, 1934. [Note. — The alternate arrangement accompanied similar message to the House of Representatives.] The VICE PRESIDENT. The message and the accom- panying docimients will be referred to the Committee on Appropriations. annual report of the secretary of the treasury The VICE PRESIDENT laid before the Senate the annual report of the Secretary of the Treasury on the state of the finances for the fiscal year ended June 30. 1933, which was referred to the Committee on Finance. disposition of useless papers in the treasury department The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Treasiur. transmitting, pursuant to law, schedules and lists of useless papers and documents in the files of the Treasury Department which are not needed in the transaction of the current business of the Department and have no permanent value or historical in- terest, which, with the accompanying report, .was referred 1934 CONGRESSIONAL RECORD— SENATE to the Committee on the Disposition of Useless Papers In the Executive Departments. The VICE PRESIDENT appointed Mr. Harrison and Mr. Reed as the members of the committee on the part of the Senate. report of federal bttreau of narcotics The VICE PRESIDENT laid before the Senate a letter from the Acting Secretary of the Treasury, transmitting, pursuant to law. a copy of the annual report of the Federal Bureau of Narcotics for the calendar year ended December 31, 1932. which, with the accompanying report, was referred to the Committee on Finance. report on government positions The VICE PRESIDENT laid before the Senate a letter from the Director of the Bureau of the Budget, transmitting. pursuant to law. a statement of the reports submitted by the executive departments and independent establishments, and the municipal government of the District of Columbia, showing the number of vacant positions therein, the number filled, and the amounts unexpended for the period between July 1, 1933. and October 31. 1933. which, with the accom- panying report, was referred to the Committee on Appro- priations _and ordered to be printed. ANITDAL report OF FXTERTO RICAM HURRICANE RELIEF COMMUUON The VICE PRESIDENT laid betort the Senate a letter from the Secretary of War, chairman of the Puerto Rican Hurricane Relief Commission, transmitting, pursuant to the annual report of the Commission for the year ei September 30, 1933, which, with the accompanying, report, was referred to the Committee on Appropriatioiu. REPORT OF NATIONAL FOREST RESERVATION COMMISSION (8J»OC. NO. 106) The VICE PRESIDENT laid before the Senate a letter from the Secretary of War. as ex officio president of the National Forest Reservation Commission, transmitting, pur- '^suant to law. the annual report of the Commission for the fiscal year ended June 30. 1933. which, with the accompany- ing report, was referred to the Committee on Agriculture and Forestry and ordered to be printed with an illustration. SPECIAL railway MAIL TRANSPORTATION CONTRACTS The VICE PRESIDENT laid before the Senate a letter from the Postmaster General, transmitting, pursuant to law, reports relative to special contracts made with the following railroad companies for the transportation of the malls: Hudson & Manhattan Railroad Co., between Hudson Ter- minal Station, New York. N.Y., and Journal Square. Jersey City. NJ.; Rio Grande Southern Railroad Co., Victor A. Miller, receiver, between Ridgway and Durango, Colo.; and Colorado & Southern Railway Co., between Denver and Lead- ville, Colo., which, with the accompanying reports, was re- ferred to the Committee on Post Offices and Post Roads. DISPOSITION OF USELESS PAPERS IN THE POST OFFICE DEPARTMENT The VICE PRESIDENT laid before the Senate a letter from the Acting Postmaster General, transmitting, pursuant, to law, a schedule of papers and documents in the files of the Post Office Department which are not needed or useful in the transaction of the current business of the Department and have no permanent value or historical interest, which, with the accompanying papers, was referred to a Joint Select Committee on the Disposition of Useless Papers in the Efxecutive Departments. The VICE PRESIDENT appointed Mr. McKbllar and Mr. ScHALL as members of the committee on the part of the Senate. AIRCRAFT PURCHASED FOR THE NAVY The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Navy, transmitting, pursuant to law, a report of designs, aircraft, aircraft parts, and aero- nautical accessories purchased by the Na\T Department during the fiscal year ended June 30, 1933. the prices paid therefor, and the reason for the award in each case, which, with the accompanying report, was referred to the Com- mittee on Naval Affairs. liXXVUI 9 REFOKT or WAR MiMiKAU nuKT comnssioiv The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Interior, transmitting, pursuant to law. a report of the War Minerals ReUef Commission tas the year ended November 30. 1983. which, with the accom- panying report, was referred to the Committee on Mines and Mining. CANCELATIONS OF XNSIAN niDEBTEDNXSS The VICE PRESIDENT laid before the Senate two letters from the Secretary of the Interior, transmitting, pursuant to law, reports of cancelations and adjustments of reim- bursable charges of the United States existing as debts against individual Indians or tribes of Indians, which, with the accompanying reports, were referred to the Committee on Indian Affairs. FEDERAL SCIENTIFIC RESEARCH OR EXPERIMENTATION ACTIVITZBS (S.DOC. NO. 102) The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Interior, transmitting, in response to Senate Resolution 101. agreed to June 12. 1933. a report relative to personnel reductions and curtailed activities of the Geological Survey. Office of Education. National Park Service, and the Virgin Islands, in connection with scientific research and experimentation, which, with the accompany- ing report, was ordered to lie on the table and to be printed. »nuL scrarriFxc rkskaech ok xxpexxmsntatioii AcriviTin iBMX. 1K>. lOS) The VICE PRESIDENT also laid before the Senate a letter from the Acting Secretary of Agriculture, tranamitting, in response to Senate Resolution 101, agreed to June 12. 1933, a report relative to personnel reductions and curtailed activ- ities in connection with scientific research and experimen- tation conducted by the Department of Agriculture, which, with the accompansring report, was ordered to lie on the table and to t>e printed. REPORT OF MIGRATORY BXXD CONSERVATION COMMISSION The VICE PRESIDENT laid before the Senate a letter from the Secretary of Agriculture, as ex officio Chairman oi the Migratory Bird Conservation Commission, transmitting, pursuant to law, the report of the Commission for the fiscal year ended June 30, 1933, which, with the accompanying report, was referred to the Committee on Agriculture and Forestry. ANNUAL REPORT OF SECRETARY OF COBCMERCE The VICE PRESIDENT laid before the Senate a letter from the Secretary of Commerce, transmitting, pursuant to law, his annual report for the fiscal year ended June 30, 1933, which, with the accompansring report, was referred to the Committee on Commerce. SETTLEMENT OF SHIPPING BOARD CLAIMS The VICE PRESIDENT laid before the Senate a letter from the Secretary of Commerce, transmitting, pursuant to law. a report of claims arbitrated or settled by agreement from October 16, 1932, to October 15, 1933, by the United States Shipping Board Bureau and United States Shipping Board Merchant Fleet CorpOTation, which, with the ac- companying report, was referred to the Committee on Commerce. EXCHANGE OF LANDS AT KEY WEST, FLA. The VICE ^PRESIDENT laid before the Senate a letter from the Secretary of Commerce, transmitting a draft of legislation to authorize the Secretary of the Navy and the Secretary of Commerce to exchange a portion of the naval station and a portion of the lighthouse reservation at Key West. Fla., which, with the accompanying paper, was re- ferred to the Committee on Commerce. REPORT ON NATIONAL INCOME, 1»2»-3S The VICE PRESIDENT laid before the Senate a letter from the Acting Secretary of Commerce, transmitting, in response to Senate Resolution 220, Seventy-second Congress, a report on the national income, 1929-32. which, with the accomi;>anying report, was referred to the Committee on Finance. M CONGRESSIONAL RKCORD— SENATE AmCTTAL RCTORT OF TH« PtJBLIC PRnTTW The VICE PRESIDENT laid before the Senate a Ict^r from the Public Printer, trammitting. P^^/^^^J^^ ^^^^! annual report of the operations of the United States Gov CTMwnt Printing Office for the fiscal year ended June 30. SS?^ ?ndTe «flendar year 1933. which, with the accom- ^nying report, was referred to the Committee on Printing. KEPOKT OF BELLEAU WOOD MFIIOBIAL ASSOCMTIOH The VICE PRESIDENT laid before the Senate a letter fronTthe honorary President of the BeUeau Wocxl Memorial Association, transmitting, pursuant to ^^'l^^^^I^^,^^ the association for the year ended December Jl. 1932. which, with the accompanying report, was referred to the Commit- tee on Military Affairs. REPORT OF TEXTILE FOUNDATION The VICE PRESIDENT laid before the Senate a letter from the chairman of the Textile Foundation, transmittmg. pursuant to law. a report of the proceedings, activities, m- come and expenditures of the corporation for the year ended December 31. 1932, which, with the accompanying report, was referred to the Committee on Education and Labor. ANinJAL RETORT OF THE INTERSTATE COMMERCE COMMISSION The VICE PRESIDENT laid before the Senate a letter from the Chairman of the IntersUte Commerce Commission, transmitting, pursuant to law. the annual report of the Commission for the year ended October 31, 1933. except as otherwise noted, which, with the accompanying report, was referred to the Committee on Interstate Commerce. FINAL VALUATIONS OF CERTAIN RAILROAD PROPERTIES The VICE PRESIDENT laid before the Senate a letter from the Chairman of the Interstate Commerce Commission, transmitting, pursuant to law. final valuations of properties of the St Louis k San Francisco Railway Co. and 84 other railway companies, which, with the accompanying docu- menU, was referred to the Committee on Interstate C(xnmerce. rjsEma papers in the railroad administration The VICE PRESIDENT laid before the Senate a letter from the Assistant Director General. United States Railroad AdministraUon. transmitting, pursuant to law. a report of papers and documents in the flies of the Administration which arc not needed or useful in the transaction of the current business of the department and have no permanent vahie or historical interest, which, with the accompanying papers, was referred to a Joint Select Committee on Disposi- tion of Useless Executive Papers. The VICE PRESIDENT appointed Mr. Dill and Mr. CouzENS as the members of the committee on the part of the Senate. report of the daughters of the AMERICAN REVOLXTTION The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Smithsonian Institution, trans- mitting, pursuant to law. the annual report of the National Society of the Daughters of the American Revolution for the year ended AprU 1. 1933. which, with the accompanying report, was referred to the Committee on Printing. REPORT OF FARM CREDIT ADMINISTRATION The VICE PRESIDENT laid before the Senate a letter from the Governor of the Farm Credit Administration, transmitting, pursuant to law. a preUminary report of the activities of the Farm Credit Administration to December 31. 1933, which, with the accompanying report, was referred to the Committee on Banking and Currency. REPORT OF GORGAS MEMORIAL INSTITUTE "^The VICE PRESIDENT laid before the Senate a letter from the President and Chairman of the Gorgas Memorial Institute of Tropical and Preventive Medicine. Inc.. trans- "^ mitting. pursuant to law, the report of the Institute for the year ended October 31. 1933. which, with the accompanying report, was referred to the Committee on Interoceanic Canals. January 4 WILLIAM E. B. GRANT The VICE PRESIDENT laid before the Senate a letter flom the comptroller General of the United States, trans- mitting, pursuant to law. a report of an examination of the calm of William E. B. Grant, which, with the accompanying report, was referred to the Committee on Naval Affairs. AGRICULTURAL HAND TOOLS I The VICE PRESIDENT laid before the Senate a letter ftom the Chairman of the United States Tariff Commission, rammming in response to Senate Resolution 295^Seventy- Irst Congress, copy of a report of an nvestigation by the ommission with respect to agricultural hand tools, which. 1th the accompanying report, was referred to the Com- Ittee on Finance. COTTON VELVETS AND VELVETEENS The VICE PRESIDENT laid before the Senate a letter rom the Chairman of the United States Tariff Commission, ■ansmitting. in response to Senate Resolution 440. Seventy- rst Congress, copy of a report of an investigation by the ■ommission with respect to cotton velvets and velveteens hich. with the accompanying report, was referred to the Committee on Finance. SYNTHETIC CAMPHOR The VICE PRESIDENT laid before the Senate a letter rom the Chairman of the United States Tariff Commission, xansmitting. for the information of the Senate, copy of a •eport made by the Commission with respect to synthetic amphor conducted in accordance with a special Provision a paragraph 51 of the Tariff Act of 1930, which, with the ccompanying document, was referred to the Committee on DUTIES COLLECTED ON IMPORTS FROM PRINCIPAL COUNTRIES The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Tariff Commission transmitting, for the information of che Senate, a copy of a statistical report entitled "Computed Duties and Equiva- lent Ad Valorem Rates on Imports into the United States from Principal Countries, 1931 ", which, with the accom- panying document, was referred to the Committee on Finance. METHODS OF VALUATION FOR TARIFF PURPOSES The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Tariff Commission, transmitting, for the information of the Senate, a copy of a report sent to the President by the Commission in an in- vestigation with respect to methods of valuation, m accord- ance with the provisions of section 642 of the Tariff Act of 1930. which, with the accompanying document, was referred to the Committee on Finance. RUSSIAN ASBESTOS The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Tariff Commission, transmitting, for the information of the Senate, a copy of a report sent to the President by the Commission in an in- vestigation, for the purposes of section 337 of the Tariff Act of 1930, with respect to Russian asbestos, which, with the accompanying document, was referred to the Committee on Finance. DUTIES ON FISH IN OIL The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Tariff Commission, transmitting, for the information of the Senate, a copy of a report sent to the President by the Commission in an in- vestigation, for the purposes of section 336 of the Tariff Act of 1930. with respect to fish in oil. which, with the accom- panying document, was referred to the Committee on Finance. ANNUAL REPORT OF THE TARIFF COMMISSION The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Tariff Commission, transmitting, pursuant to law, the seventeenth annual report of the Commission, for the fiscal year ended June 30, 1933, 1 1934 CONGRESSIONAL RECORD— SENATE Ur T,l which, with the aceompanylag report, was referred to the Committee on Finance. ANHUAL REPORT OF BOARD OF MEDIATIOlf The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Board of Mediation, transmitting, pursuant to law, the seventh annual report of the Board, for the fiscal year ended June 30. 1933, which, with the accompanying report, was referred to the Commit- tee on Interstate Commerce. nucncB OF the healing arts in distexct of columbu The VICE PRESIDENT laid before the Senate a letter from the president of the Commission on Licensure. Healing Arts Practice Act, District of Columbia, transmitting, pur- suant to law. a report of the activities of the Commission for the fiscal srear ended June 30, 1933. which, with the accompanying report, was referred to the Committee on the District of Colmnbia. delinquent accounts or federal officers The VICE PRESIDENT laid before the Senate a letter from the Comptroller General of the United States, trans- mitting, pursuant to law. a report showing officers of the Government who were delinquent in rendering or transmit- ting their accounts to the proper officers In Washington (luring the fiscal year ended June 30. 1933. and whether the delinquency was waived, together with a list of oflScers who, upon final settlement of their accounts, were found to be indebted to the Government and had failed to pay the same into the Treasury of the United States, which, with the accompanjring report, was referred to the Committee on Claims. JUSGKENTS rendered BT THE COURT OF CLAIMS (S.DOC. NO. 101) The VICE PRESIDENT laid before the Senate a letter from the Chief Clerk of the Court of Claims, transmitting, pursuant to law, a statement of judgments rendered by the Court of Claims for the year ended December 2, 1933, the amount thereof, the parties in whose favor rendered, and a brief synopsis of the nature of the claims, which, with the accompanying statement, was referred to the Committee on Appropriations and ordered to be printed. JUDGMENTS ENTERED BY THE COURT OF CLAIMS (S.DOC. NO. 104) The VICE PRESIDENT also laid before the Senate a letter from the Chief Clerk of the Court of Claims, trans- mitting a statement of judgments entered by the court in the following cases referred to the court by the Senate under the Judicial Code: Farmers St Ginners Cotton Oil Co.. Hodgson Oil Refining Co.. Planters Cotton Oil Co., Brookhaven Cotton Oil k Fertilizer Co., Planters Manufac- turing Co., and Buckeye Cotton Oil Co.. which, with the accompanying statement, was referred to the Committee on Appropriations and ordered to be printed. WILLIAM WRIGLEY. JR., CO. (SJ>OC. NO. 103) The VICE I^IESIDENT laid before the Senate a letter from the Chief Clerk of the Court of Claims, transmitting a certified copy of the special findings of fact, conclusions of law. and opinions of the court in the case of William Wrigley. Jr., Co.. referred to the court by the Senate under the Judicial Code, which, with the accompanying document, was referred to the Committee on Claims and ordered to be printed. OOHOREaSIOHAL CASES DISMI8SSD BT COURT OF CLAIMS The VICE PRESIDENT laid before the Senate a letter from the Chief Clerk of the Court of Claims, advising the Senate that the cases of Louis Nixon. Maryland Iron Works, and Columbia Iron Works b Dry Dock Co., of Baltimore, Md., which were referred to the court by the Senate were dismissed for want of prosecution, which, with the accom- pan3?ing papers, was referred to the Committee on Claims. The VICE PRESirWENT also laid before the Senate two letters from the Chief Clerk of the Court of Claims, stating that the claims of W. R. Trigg and James L. Vai, which were referred to the court by the Senate, had been dismissed on the motions of plaintiffs, which were referred to tbcf' Committee on Claims. PaOPOSED CONSnTUnOMAL AMBMUMXIfT IKIATIVX TO CHILD LAMM The VICE PRESIDENT laid before the Senate a letter from the Governor of the State of Illinois, transmitting copy of a joint resolution of the General Assembly of Illi- nois relating to the ratification of the so-called ' child labor amendment " to the Constitution, which, with the accom- panying papers, was ordered to lie on the table, as followa: Stats or Ilumov. OrncB or the OoratNoa, Springfield, August IS. l»3i. , Tht honorable the Vice PsasioKirr or tks Umiteo Btatkm AND PiaSUWirT ?5 °' persons under 18 years or age was ratified by the State of Iowa. December 5. 1933 Yours very truly. _ State or Iowa, Secretabt of State. I Mrs Alex Miller, secretary of state of the State of Iowa and custodian of the acts and resolutions of the General Assembly of Iowa do hereby certify that the attached Instrument Is a true and correct copy of Senate Joint Resolution No. 1. by which a proposed amendment to the Ckjnstttutlon of the United States of America, relative to the labor of persons tinder 18 years of age has been ratified by the State of Iowa. ^ - ^ In testimony whereof. I have hereunto set my hand and affixed my official seal this 12th day of Etecember 1933. |SXAX,1 Vin. Alex Mn.T.EK. Secretary of State. Senate Joint resolution ratifying a proposed amendment to the Constitution of the United States of America, relative to the labor of persona under 18 years of age. Whereas both Houses of the Sixty-eighth Congress of the United States of America, by a constitutional majority of two thirds thereof, made the following proposition to amend the Constitu- tion of the United States of America, to wit: " Joint resolution proposing an amendment to the Constitution of the United States " Besdved by the Senate and House of Representatives of the j United States of America in Congress assembled {two thirds of < each HouM concurring therein). That the following article Is i proposed as an amendment to the Constitution of the United States, which, when ratified by the legislatures of three fourths of the several States, shall be valid to all intents and purposes as a part of the Constitution: "abticlx — " Sectiow 1. The Congress shall have power to limit, regulate. and prohibit the labor of persona under 18 years of age. " Sec. a. The power of the several States Is unimpaired by this article except that the operation of State laws shall be suspended to the extent necessary to give effect to legislation enacted by the Congrew." Now. therefore, be It Resolt^ed and enacted by the General Assembly of the State of Iowa: Section 1. That the said proposed amendment to the Consti- tution of the United States of America as set forth herein be and tlic same Is hereby ratified and consented to by the State of Iowa and by the general assembly thereof. 8bc. 3. Be it further resolved and enacted. That copies of this enactment and reaolutlon. certified by the secretary of state, be fur warded by the Ooremor of this State to the Secretary of State of the United States at Washington. D.C and to the presiding oOcsr of each House of the Congrsss of the United States. N. a. KSASCMSL. President of the Senate. Oso. 1. liiLLsa. Speaker of the House. I hereby oartlfy that this senate Joint resolution originated in the senate and is known as SenaU Joint Resolution Mo. 1, forty* fifth general aesembly in extraordinary session. Braoi* O, AiXBif, Seeretary of the Senate. TtM VXCI PRI8IX>BNT «1k) Imid before the SenaU « letter from tlM lecretArjr of sUtte of the State of Maine transmit- ting copy of a rwohitlon of the Legislature of the State of Maine ratifying the eo-called " child labor amendment " to the Cooftltutlon. which, with the accompanying papers, was ordered to lie on the table, as follows: DcTASTMSirr or gTAn. Stati or Maxits, Augusta, December iO, 1933. The honorable the PutszoKNT or the Uwrm Btates Bkmati. United States Seriate Building, Wtuhington, D.C. Dbae Sn: I have the honor to transmit herewith a copy of a resolve of the Eighty-sixth Legislature of the State of Maine rati- fying the proposed amendment to the Constitution of the United States permitting Congress to regulate child labor. Very respectfully yours. Robinson C. Toeet. Secretary of State of the State of Maine. State or Maine. DiPAKTMXNT OF STATE. 1, Robinson C. Tobey. secretary of state, certify that the paper to which this is attached Is a true copy from the records of this office. In testimony whereof I have caused the great seal of the StAte to be hereunto affixed. Given under my hand at Augusta this 19th day of December, AI>. 1933. and In the one hundred and fljty -eighth year at the Independence of the United States of Anerlca. ^ ^ I SEAL 1 Robinson C. Tobet, ' ' Secretary of State. Resolve. Ratifying the proposed amendment to the Constitution ol the United States permitting Congress to regulate child labor. Whereas the Sixty-eighth Congress of the United States ol Anerlca, at the first session begun and held at the city of Wasn- ligton. in December 1923. on June 2. 1924. by a constitutional tuo-thirds vote in both Houses, adopted the following Joint resolve proposing an amendment to the Constitution of the United States. JOINT RESOLUTION Proposing an amendment to the Constitution of the United 8 Ates, the text of which resolution is as follows, to wit: " Resolved by the Senate and House of Representatives of the United States of America in Congress assembled {tiro thirds of eiic/i House concurring therein). That the following article Is pro- p»ed as an amendment to the Constitution of the United States, which, when "ratified by the legislatures of three fourths of the s( veral States, shall be valid to all Intents and purposes as a part of the Constitution: "article — "Section 1. The Congress shall have power to limit, regulate. ■ ad prohibit the labor of persons under 18 years of age. " Sec 2. The power of the several States Is unimpaired by this article except that the operation of State laws shall be suspended t) the extent necessary to give effect to legislation enacted by the C ongress " : Therefore be it ...,.». Resolved. That the Legislature of the State of Maine hereby ritlfles and adopts this proposed amendment to the Constitution of the United States; and be it further Resolved, That the secretary of state of the State of Maine Eotlfy the President of the United States, the Secretary of State ct the United States, the President of the Senate of the United gtates. and the Speaker of the House of Representatives of the I nlted States of this action of the legislature by forwarding to e fcch of them a certified copy of this resolve. Read and passed finally. Read and passed finally. Approved December 16. 1933. In House or Representatives, December 16. 1933. Franz U. Burkett, Speaker. In Senate. December 16. 1933. Harold H. Murchie. President. Lotns J. Brann." Governor. The VICE PRESIDENT also laid before the Senate a joint ijesolutlon of the Legislature of the State of Minnesota, ratifying the so-called " child labor amendment " to the Con- 4titutlon. which was ordered to lie on the table, as follows: State or Minncsota, Defastment or State. I, Mike Holm, Secretary of State of the State of Minnesota, do 4ereby certify that X have compared the annexed copy with record ropo«ed an amendment to the Constitution of the Uniti'd States 4 America, which resolution reada as (ollows, to wit: ' Proposing an amendment to the Constitution of the United gtaus. " Resolved by the Senate and House of Representatives of the Jnited States of America in Congress assembled [two thirds of tach House concurring therein). That the following article is pro- x>sed as an amendment to the Constitution of the United States, rhlch, when ratified by the legislature of three fourths of the leveral States, shall be valid to all Intents and purposes as a >art of the Constitution: " ' ARTICLE — "'Section 1. The Congress shall have power to limit, regulate, ind prohibit the labor of persons under 18 years of age. " ' Sec. 2. The power of the several States is unimpaired by ;hls article except that the operation of State laws shall be sus- )ended tc the extent necessary to give effect to legislation enacted jy the Consress." " Therefore be it Resolved by the Legislature of the State of Minnesota: Section 1. That the said proposed amendment to the Constl- ut'on of the United States of America be and the same Is hereby -atlfied by the Leglslatxire of the State of Minnesota. ^1 Sec. a. That the secretary of state be and he is hereby directed to forward certified copies of this preamble and Joint resolution to the Presiding Officer of the United States Senate and the Bpealcer of the House of Representatives of the United States, and that he transmit official notice hereof to the Secretary of State of the United States, as provided by the law of this State. Chas. Munn. Speaker of the House of Representatives. K. K. SCLBERG, President of the Senate. Passed the house of representatives the 13th day of December 1933. Harrt L. Allen, Chief Clerk House of Representatives. Passed the senate the 14th day of December 1933. G. H. Spaeth, Secretary of the Senate. Approved: December 14. 1933. Plotd B. Olson, Governor of the State of Minnesota. Filed: December 14. 1933. Mike Holm. Secretary of the State of Minnesota. The VICE PRESIDENT also laid before the Senate a con- current resolution of the Legislature of the State of North Dakota latifying the so-called " child labor amendment " to the Ck)nstitution, which was ordered to lie on the table, as follows: Department or State. State or North Dakota. To all to whom these presents shall come: I, Robert Byrne, secretary of state of the State of North Dakota and keeper of the great seal thereof, do hereby certify that the annexed copy of Senate Concurrent Resolution No. H of the Twenty-third Legislative Assembly of the State of Worth Dakota has been compared by me with the original Senate Concurrent Res- olution No. H on file In this department, and that the ssune Is a true copy thereof, and of the whole of such Instrument. In testimony whereof I have hereunto set my hand and affixed the great seal of the State at the capltol. In the city of Bismarck, this 9th day . 1933. by a consti- tutional majority of two thirds thereof, made and passed a pro- posal to amend the Constitution of the United States of America In the following words, which Joint resolution was duly ratified by Congress and approved by the President of the United States on or about the 0th day of June, A.D. 1934. " Joint resolution proposing an amendment to the Constitution ot the United States " ttaeolpod by the Seriate artd the Houee of Repreeentativee of the United States of America in Congreee aeeembled {ttoo thtrde of taeh Mouea ooncwring thtretn), That the following article Is pro- posed as an amendment to the Constitution of the United States, which when ratified by the legislatures of three fourths at the several States shall be raild to all Intente and pttrpoeee ae a part ol the Oonetltutloo: "Asnots — "•■onew 1, The Congress shall have power to limit, regulate, and prohibit the labor of persons under IS years of age, " MO. 9. The power of tne several Ststes Is unimpaired bf this artlele exeept that the operation of State laws shall be suspended to the extent nsesssary to give sffset to Isglslstlon enacted by the C I. Chas. M. Armstrong, secretary of state of the State of Colo- rado, do hereby certify that the annexed Is a fuU, true, and cor- rect copy of the resolution »Aopted Jbf a convention held in the State of Colorado, and called In accordance with the provisions of chapter 7 of the laws passed at the extraordinary session of the Twenty-ninth General Assembly of the State of Colorado, ratify- ing the proposed amendment to the Constitution of the United States of America, providing for the repeal of the eighteenth amendment thereto, which was filed In my office on the 9th day of October, AD. 1933, at the hour of 2 pjn. In testimony whereof I have hereunto set my hand and affixed the great seal of the State of Colorado, at the dty of Denver, this 9th day of October, AD. 1938. [SBAi.] Chas. li. Aaicsxmove. Secretary of State. CONGRESSIONAL ilECORD-^EN ATE Resolution ratifying the proposed amendment to the Constitu- tion of the United States of America, providing for the repeal of the eighteenth amendment thereto Whereas the Seventy-second Congress of the United States of America at the second session, begun and held at the city of Washington on Monday the 5th day of December 1932. did pass the following resolution proposing an amendment to the Consti- tution of the United SUtes, to wit: * ** Joint resolution proposing an amendment to the Constitution of the United States "Resolved l>y the Senate and House of Representatives of the United States of America in Congress assembled (two thirds of each House concurring therein). That the following article is hereby proposed as an amendment to the Constitution of the Usned States, which shall be valid to all Intents and purposes as part of the Constitution when ratified by conventions In three fourths of the seTeral States: " 'Asncue — " ' Sbction 1. The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. " ' Sac. 2. The transportation or importation Into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors In violation of the laws thereof Is hereby prohibited. " ' Sic. 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by conven- tions in the several States, as provided in the Constitution, within 7 years from the date of the submission hereof to the States by the Congress.' "Jno. N. GAsmai. * Speaker of the He use of Representatives. " C HARLXS CUBTia, " Vice President of the United States and President of the Senate." And Whereas there was duly transmitted to the general assembly of this State the said article of amendment proposed by the Con- gress to the Constitution of the United States; and Whereas the general assembly of this State, pursuant to law, X did enact an act entitled "An act to provide for a convention to act upon the amendment to the Constitution of the United States, providing for the repeal of the eighteenth amendment ", which said act, having passed both houses of the general assem- bly, was approved by the Grovernor of this State on August 10. 1933, and constitutes chapter 7 of the Session Laws of Colorado, extraordinary session. 1933; and Whereas, piirsuant to the provisions of said act of the general assembly, an election for the selection of delegates to the said convention was duly held on September 12, 1933. at which said election delegates were chosen in accordance with the provisions of aald act: Now. therefore, be it Resolved by the convention of delegates duly elected and assem- bled this 26th day of September 1933 in the senate chamber at the State eapitol, in the city and county of Denver, State of Colorado, and duly organized pursuant to law. That said pro- posed article of amendment to the Constitution of the United States of America be. and the same is hereby, ratified by this convention; and be it further Resolt>ed, That the president and secretary of this convention shall certify the result of the votes of the delegates to the secre- tary of state of this State; and be It further Resolved, That the secretary of state of this State shall certify the resxilt of this vote to the Secretary of State of the United States in the manner in which amendments to the Constitution of the United States submitted to the legislature for ratification are certified. We recommend adoption of the foregoing. Hasbt LtTsxac. Cfiairman. NoxicA Wason Doocs, Edwaxo D. Nicholson, W. W. Gkant, Jr., Constituting the Resolutions Committee. »^ «_ m. . DnrvBB. Colo. TO Chablbs If. AsMaraoMo, Secretary of State of the State of Colorado. We, Spencer Penrose and Anna Lou P. Boettcher, respectively president and secretary of the convention called for the purpose of acting upon the ratification of the profKJsed amendment for the repeal of the eighteenth amendment, do hereby certify that the foregoing is the original copy of the resolution adopted by the State convention ratifying the proposed amendment providing for the repeal of the eighteenth amendment. We do further certify that the said resolution was adopted by a vote of 15 for the adoption of the resolution and none against the adoption of the resolution, the same being the unanimous vote of the delegates to the convention In favor of the adoption of the resolution. In witness whereof.* we have hereunto set our hands this 2eth day of September. AJ>. 1933. SpxNcxa PxintosB, President of the Convention. Akka Lou P. BorrrcHm, Secretary of the Convention. The VICE PRESIDENT also laid before the Senate the following documents, transmitted by the secretary of state January 4 of the State of Connecticut, pertaining to the ratification of the amendment to the Constitution repealing the eighteenth amendment thereto, which were ordered to lie on the table: State or Connecticttt, Office of the Secretary, ss: I, John A. Danaher, secretary of the State of Connecticut and keeper of the seal thereof, do hereby certify that the copies hereto attached are true copies of special acts of the General Assembly of the State of Connecticut passed at its January session 1933 and respectfully numbered and entitled as follows: " No. 137. An act providing for a convention to consider the question of the adoption or rejection of an amendment repealing the eighteenth amendment submitted to this State by the Con- gress of the United States. " No. 247. An act amending an act providing for a convention to consider the question of the adoption or rejection of an amend- ment repealing the eighteenth amendment submitted to this State by the Congress of the United States." I further certify that the copies attached are true copies of the several proclamations issued by His Excellency Wilbur L. Cross, Governor of the State of Connecticut, dated May 6, 1933, desig- nating June 20, 1933. a date for the election of delegates to a convention; and dated June 21, 1933, designating July 11, 1933, a date for the holding of a convention in the hall of the hoxise of representatives in the State eapitol in Hartford. And I further certify that the copy attached is a true copy of the resolution passed by the convention of delegates held in the hall of the house of representatives in the State eapitol in Hart- ford on July 11, 1933, pursuant to said special acts and said proclamations. In testimony whereof I have hereunto set my hand and affixed the great seal of the State of Connecticut at Hartford this 12th day of July, AX). 1933. [sxAL] John A. Danaher. Secretary. An act providing for a convention to consider the question of the adoption or rejection of an amendment repealing the eight- eenth amendment, submitted to this State by the Congress of the United States Be it enacted by the senate and house of representatives in general assembly convened: Whereas the Congress of the United States has proposed an amendment to the Constitution of the United States to be valid when ratified by conventions In three fourths of the States, which proposed amendment is as follows: "Section 1. The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. " Sec. 2. The transportation or Importation Into any State. Ter- ritory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited. " Sec. S. This article shall be inoperative unless It shall have n been ratified as an amendment to the Constitution by conventions in the several States, as provided in the Constitution, within 7 years from the date of the submission hereof to the States by ■*• the Congress." Now, therefore, to provide for the constitution of such conven- tion in this State, the time and place of holding the same, and the manner of election of delegates thereto. Be it enacted by the senate and house of representatives in general assembly convened: Section 1. A convention for the sole purpose of ratifying or rejecting the proposed amendment to the Constitution of the United States recited in the preamble shall be held in the hall of the house of representatives in the State eapitol at Hartford on such date as shall be fixed by the Governor by proclamation. See. 2. Said convention shall be composed of 50 delegates, 1 to b« elected from each senatorial district, and 15 to be elected at large, in the manner hereinafter provided. Sec. 3. The Governor shall, by proclamation, fix a date for the election of such delegates, which date shall be not less than 10 days nor more than 60 days after the final adjournment of the present session of the general assembly. Said proclamation shall be Issued at least 6 weeks before such date and shall set forth the manner of and time for nominating such delegates as herein- after provided. Sec. 4. At said election all persons qualified to vote for mem- bers of the general assembly, and who were registered on the re- vised registry list then last completed according to law, shall be entitled to vote. Sec. 5. Except as In this act otherwise provided, said election shall be conducted and the results thereof ascertained and certi- fied in the same manner as in the case of the election of Presi- dential electors in this State, and all provisions of the statutes of this State relative to elections, except so far as inconsistent with this act, are made applicable to said election. Sec. 6. Each delegate to said convention shall be an elector and resident of the State, and each district delegate shall be a resi- dent of the senatorial district by which he is to be elected. Nomi- nations shaU be by petition and not otherwise. Nominating peti- tions shall be filed with the secretary of the State at least 4 weeks prior to the proclaimed date of the election. E:ach petition noml- naUng a candidate for a district delegate shall be signed by not less than 100 electors resident within the district, and each peti- tion for delegates at large shall be signed by not less than 500 cJacton resident within the State. Such petitions shall contain 1934 CONGRESSIONAL RECORD— SENATE the name, street, and town address of each signer, and shall be submitted to the town clerks of the towns in which such signers reside at least 1 week prior to the filing thereof, and such town clerks shall certify thereon the electors signing such petitions whose names appear on the voting list last completed in their respective towns. Each petition nominating a district delegate shall state that the nominee is in favor of the proposed amend- ment, or that he Is opposed to the proposed amendment, as the case may be; and each petition nominating delegates at large shall contain the names of 15 candidates, and shall state that all of them are in favor of, or that all of them are opposed to, the proposed amendment, as the case may l>e. Any person cir- culating a nominating petition for signature shall leave in the town clerk's office in the town where he is circulating such jjetl- tlon a copy thereof. Including the names of the candidates named in such petition, and such petition may be then signed by quali- fied electors. If more than one petition nominating different can- didates for a district delegate in favor of said proposed fimendment, or more than one petition nominating different can- didates opixjsed to such proposed amendment, shall be received by the secretary of the State, or more than one petition nomi- nating delegates at large in favor of, or more than one petition nominating delegates at Jarge opposed to, said proposed amend- ment, shall be received by the secretary of the State, he shall act on the petition containing the largest number of certified signa- tTires, or, in the case of a tie. shaU select by lot the petition to be acted upon, and shall disregard the other petitions. If no proper petition be filed nominating candidates favoring ratifloa- tlon or opp>osing ratification within the time herein provided, the Governor shall nominate such candidates and the candidates so nominated sbaU be placed upon the ballots or voting machines in the same manner as if regularly nominated by petition. Sec. 7. The secretary of the State shall then cause to be printed for each senatorial district a s\ifflcient number of ballots. Said ballots shall contain a statement of the proposed amendment to the Constitution of the United States, followed by a clear state- ment of the way in which the voter is to mark the tMdlot. They shall be arranged in perpendicular columns of equal width, headed, respectively, in plain type, " For Batiflcation " and "Against Ratification." In the coltnnn headed " For Ratification " shall be placed the names of the candidates for delegates at large nomi- nated as In favor of ratification, followed by the name of the candidate for district delegate nominated as In favor of ratifica- tion. In the column headed "Against Ratification " shall be placed the names of the candidates for delegates at large nomi- nated as opposed to ratification, followed by the name of the candidate for district delegate nominated as opposed to ratifica- tion. At the left of each name shall be a {nlnted square. At the head of each column shaU be a circle. To vote for all the candidates in favor of ratification, or to vote for all the candidates opposed to ratification, the voter may make a cross mark In the circle at the head of the list of candidates. Any voter may. If he shall so prefer, make no mark in either circle, and vote for the Individual candidates whom he shall prefer, not exceeding 10, making a cross mark in the square at the left of the name of the candidate. Sec. ^. For use In towns or voting precincts in which the vot- ing machine is \ised in general elections, the secretary of the State shall cause to be printed a suflkrient supply at instructions to votsrs, giving the text of the proposed amendment, clear Instructions to voters, and the names of the candidates arranged In horizontal rows, one row bearing the names of all the candi- dates In favor of ratification and the other row bearing the names of all the candidates against ratification. The names ShaU be arranged on the voting machine in the same manner, and the voter may vote for the entire list of candidates for or against ratification, or be may vote for the individual candidates whom he shall prefer, not exceeding 1ft. The secretary of the State shaU determine by lot which list of' candidates shaU have the upper position on the voting machine or the left-band position on the baUot. Sk. 9. The candidate for district delegate who shall receive the highest vote in each senatorial district shaU be a delegate to the convention and the IS candidates for delegates at large who shall receive the highest nuinber of votes shall also be delegates. If in any district there shall be a tie, there shall be no delegate from that district, and the total membership of the convention shall be correspondingly reduced. If there shall be a failure to choose 15 delegates at large because of a tie. only the delegates who have a pluraUty of votes shall be elected, and the total number of delegates shall be correspondingly reduced. Sec. 10. The secretary of the State shall canvass the returns of the election, and shall cause the list of delegates elected to be published as soon as the result shall be asco-tained. Sec. 11. The convention shall be the judge of the dection and qualifications of its members; and shaU have power to elect Its president, secretary, and other officers, and adopt its own rules It ^all keep a journal of its proceedings, in which shall be re- corded the vote of each delegate on the question of ratification of the proposed amendment. Upon final adjournment the journal of the convention shall be filed with the secretary of the State. Sac. 12. A majority of the elected delegates shaU be required to ratify the proposed amendment. A certificate stating wtiethcr the convention has ratified or failed to ratify the prc^xised amend- ment shall be executed by the president and secretary of the con- vention and transmitted to the secretary of the State, who shaU transmit such certificate under tlie great seal of the State to the Secretary of Stotc of the United States. Bmc IS. Tbe dslsfates itfiall rsceftve no delegate shall receive an allowance for his travel from his homt to the cf4}itol and return, at ttas same rate ss is aUowod for members ctf the general assembly. Tbs comptroUer Is Instnicted to draw his order on the treasurer, payable to each delegats wbe ShaU attend the convention, for his expensss so determined. The board of finance and CQntrol shall determine the expense of i>re- paring the baUots and other expenses incurred by the secretary of the State ;n carrying out the provisions of this act. and svich expenses, together with any expenses of the convention other than for the travel of delegates shall be paid to the persons designated by the board of finance and control, by the treasurer, upon order of the comptroller. The expenses of the election for the choice of delegates in each town shaU be borne by such town. Sec. 14. If Congress shaU hereafter prescribe by statute tbs manner in which the convention shaU be consUtutsd and sball not except from the provisions of such statute such States as may theretofore have provided for constituting such conventions, the IH-eccding provisions of this act shaU be inoperaUve. and the con- vention of the State of Connecticut shall be constituted and held as such act of Congress shaU direct. AU oAeers of the State who may, by such act of Congress, be authorised or directed to take any action to constitute such a convention for this State are authorized to act thereunder and in obedience thereto, in the same manner as if they were so authorised and directed by a statuta of this State. Certified as correct by: Wnxiatc If. HasKST. Kngrossing Clerk. Rot C. Wuxox. President of the Senate. WlLXXlM Hanna. Speaker of tfie Hotue. Approved April 10, 1933. '^ WiLBUB L. Caoas. Governor. Stats am Connecticut, Oglce of the Secretary, $a: I hereby certify that the ftHregoing is a true copy at record la this oflVce. In testimony whereof I have hereunto set my hand and affixed the seal of said State, at Hartford, this 12th day of July. AJ>. li»SS. [sBAi.] JoKV A. DANAHBt. Secretary. An act amending an act providing for a convention to consider the qtiestlon of the ad<^tlon or rejection of an amendment re- pealing the eighteenth amendment submitted to this Stato by the Congress of the United States Be it enacted by the senate and house of representatives f» general assembly convened — Section 10 of no. 137 of the special acts of 1933 is amended to read as follows: "The secretary of the state shall canvass the retxirns of the election on the first Wednesday of the month following the month in which the election Is held, and shaU c«uac the list of delegates elected to be publlsbed as soon as the result ShaU be ascertained." Certified as correct by WXUJEAM M . HaajRT, Rngrosatng Clerk. Rot C. Wilcox. President of the Seuat*. William Hanna. Speaker of the House. Approved liiay 5, lOSS. WiLBTTB L. Cboss, GovemoT. State of Connscticut, Oj^lce of the Secretary, u.: I hereby c«^ify that the foregoing is a true copy of record in this otDce. In testimony whereof I have bareunto set my hand and affixed the seal of said State, at Hartford, this 12th day of July. AJ9. 1033. [seal] John A. Danaheb, Secretary. Besolntion ratifying the proposed amendmmt to the Constitution of the United States entitled " Joint resolution profxiainc *& amendment to the Constitution of the United States " Whereas the Seventy-second Congress of the United States at America at the second session, begun and held at the dty of Washington on Monday, the 5th day of Decembo: 1932. by a constltirtional majority of two thirds thereof, has made the fol- lowing proposition to amend the Constltation of the United States m the following words, to wlt: " Joint resolution proposing an amendment to the Constitution at United States "Jtesofved hy the Senmte end House of MepraeenUMvet of tha United States of America in Congress assembled (two thirds of eaeti Houae eoncurHng therein). That the following article is hereby proposed as an amendment to ttie Constitution of the United States, which shall be valid to aU intcnta and purposes as part of the Constitution when ratified by conventions In three fofortlks of the several States: " AMTtCLX — "'SocnoN 1. The eighteenth article of amendment to the Con- stitution at the United States is hereby repealed. ** aac 2. Tha transportation or importation into any State. Ter- ritory, or possession of the United States for delivery or use therein f CONGRESSIONAL : RECORD— SEN ATE January 4 of mtoxlcattof llquon. to TloUtlon of the laws thereof. Is hereby ^^SK*^ Thl- article shall be Inoperative unleffl It shall have been^tlfleda-an amendment to the Constitution by conventions S^?hriv7r^8Utes. as provided In the Constitution Jlthln 7 years from the date of the submission hereof to the States by the Congreaa. „ j^^ ,, Gark«. - Speaker of the House of Rejrresentativei " Charlxs CiniTis, •• Vice President of the United States and •• President of the Senate. vSenu pursuant to the third section of said Joint resolution andth^provlSons of Special Acts Nos. 137 and 347 of the Janu- I^ 193^ SSiion of the G^eral Assembly of the State of Oonnectl- cut. this convention has assembled In response to the P«>clMaa- S,n of his excellency, the Governor of the State of Co""^^^"*: issued under the provisions of said Special Act No. 137. Tnere- '° ReSliSd by this convention. That ..aid proposed «^endment to theConstltutlon of the United States of America, reading In words - Sktiow 1 The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. „^ ^ _ " SIC 2 The transportation or Importation Into any State. Ter- ritory or poesession of the United SUtes for delivery or use herein of IntoxkSungUquors. In violaUon of the laws thereof, is hereby prohibited. .... ^ „ w "B*c 3 ThU article shall be inoperative unless It shall have been ratified as an amendment to the Constitution by conventions to the several SUtes. as provided in the Constitution, within 7 jtmn from the date of the submission hereof to the States by the CongrcM." be and the same Is hereby ratified; be It further Resolved That a certificate stating that thla convention has ratified the propoaed amendment be executed by the president •nd secretary c< the convectiao and transmitted to the seeretar} at tbe State of Connecticut with the request that, pursoaot to said aoeetel Act Wo. 187, tbe secretary of the Stirte abaU attach tberctc UMnmst aeal Ol the State of Connecticut and transmit said certli- loite so seiOed to the Secretary of SUte of tbe United States; b4 It further tUtolved That certified copies of the foregolnC preamble an< this reeolutlon be forwarded by the secretary of the State a Connecticut to the Prceldent of the United SUtea. tbe Secretari o< State of the United SUtea. the President of the Senate of thi United SUtes. and the Speaker of the House of RepreaenUtlves o the United SUtes; be It further jtesolved. That a copy of this reeolutlon be transmitted to ttu Mcretary of the SUU of Connecticut. Stats or Cohhsuticut, OiJIce of the Secretary, ss: I hereby certify that the foregoing Is a true copy of record hi this olBce. In testimony whereof. I have hereunto set my hand, and afllxe< [ the seal of said SUte. at Hartford, this 12th day of July, A.E. iSBAX.] JOHM A. DaKAHES. Secretary. Stats or CoNKScncxrr. By His Excellency Wilbiir L. Croas, Governor A PtOCLAMATION By Tlrttie of No. 13^ of the Special Acts of 1933, as amended. [ hereby designate Tuesday. June 20 next, as a date for the electio i of delegates to a convention to be held in the hall of the house cf repreeenUtlves in the SUte capitol at Hartford on a date to be tix9d by the Governor by proclamation for the sole purpose cf ratifying or rejecting a proposied amendment to the Constltutioi of the United SUtes. which provides as follows — "SacnoM 1. The eighteenth article of the amendment to the Constitution of the United SUtes is hereby repealed. " Ssc. a. The transporUtlon or ImporUtion into any SUte. Tei ritory. or poeeeaaion of the United SUtes for delivery or use therei i ta Intoxicating liquors in violation of the laws thereof is beret ir prohibited. "Sac. 8. Thla article shall be tooperattve unless it shall ha\e been ratified as an amendment to the Constitution by convei- tlons to the several SUtes aa provided to the Constitution within 7 years from the daU of a submission hereof to the SUtes by tH e Stats of Connscticut. At said dectum BO delegates shall be choeen. one to be elected from each senatorial district wltbto the SUte. and 16 to be clcct« d at larfs to tbe ir**"™"- provided to said special act. except as othsrwlae provided to said act. as amended, said election shaU be conducted and the reeulU thereof ascerUlmd and fftrttfMKi to tlie same manner as to the case of tbe election i if Presidential elaetors to this SUU, and all provisions of the sU r- utee of thl* SUU rriatlve to elections, except so far as Inoonslstei it with said act. are to be applicable to said election. Given \mder my haxul and seal of the SUU at the c»pltol. In Hartfonl. this 0Cb day of May, AX). 1988. and of the independent « of the United States the one hundred and fifty-eeventh. WiLouB L. Caoas. By hU exoellencj's command: [•SAL] John A. DaHABsa, Secretary. By His Excellency Wilbur L. Cross. Governor A PROCLAMATION Whereas Special Act No. 137 of the ^^^^ff^ 1933 session of the General Assembly of the State of Connecticut, entitled An act providing for a convention to consider the q\fstion of the adop- tion or rejection of an amendment repealing the eigh^nth amendment submitted to this State by the Congress of the United States ", has been duly passed and Is now law; and Whereas It is provided by said special act that a convention for the sole purpos^ of ratifying or rejecting the Propoff^ ^.'^^^J; ment to the Constitution of the United States, /^cited in the preamble of said act. shall be held in the hall of the house of represenUtives In the State capitol at HarUord on such date as shall be fixed by the Governor by proclamation; and Whereas said proposed amendment to the Constitution of the United States provides as follows: "Section 1 The eighteenth article of the amendment to the Constitution of the United States Is hereby repealed. "Sec 2 The transportation or importation into any State, ler- ritory, or possession of the United States for delivery or use therein of intoxicating liquors In violation of the laws thereof is hereby ^'^" Skc *3 This article shall be Inoperative unless it shall have been ratified as an amendment to the Constitution by conventions in the several States as provided in the Constitution within 7 years from the date of a submission hereof to the States by the ^^SST'therefore. I. Wilbur L. Cross, Governor of the State of Connecticut, acting herein by virtue of the authority vested in me by said Special Act No. 137 of the January 1933 session of the sreneral assembly, do hereby proclaim and designate Tuesday. July 11 next at 10 o'clock in the forenoon, sUndard time, as the daU and hour and the hall of the house of representatives in the SUU capitol at Hartford as the place for the convening and hold- ing of such convention for the purpose of ratifying or rejecting uld propoeed amendment to the Constitution of the United In testimony whereof I have caused the seal of the SUU to be heretinto afllxed, and have here\xnto set my hand, at Hartford, on this 31st day of June, AJ5. 1933. and of the Independence of the United SUtes tbe one bttodred and fifty-seventh. WiLSOB L. Csoaa. Bt his excellency's command: ii^^i JoHjr A. Daxahss, •^^' Secretary. The VICE PRESIDENT also laid before the Senate docu- mentA transmitted by delegates to the convention for the State of New Mexico certlfjrlng to the ratification of the amendment to the Constitution repealing the eighteenth amendment thereto, which were ordered to lie on the table, as foUows: Santa Px, NJ^Iex., November 3. 1933. To the honorable the PassmsNT or the Senate, United States Senate, Washington. DC. Deae Sa: Pursuant to chapter 163 of the 1933 Session Laws of the SUte of New Mexico, and the act of Congress approved May 29 1928, we are transmitting certificate of ratification of an amendment to the Constitution of the United States relating to the repeal of the eighteenth article of amendment to the Con- stitution and certificate of election of the State canvassing board of the SUU of New Mexico certifytog to the election of the undersigned. _ ^ _ Mrs. FsANKLiN K. Lamb, Miguel A. Gonzaixs. Peaces IAuajx.. Delegates to the Convention for the State of New Mexico. cebtotcate or eatitication We the undersigned duly elected delegates chosen to vote upon ratification of the proposal of the Congress to amend the Con- stitution of the United SUtes in the foUowlng language, to wit: " Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (two thirds of each House concurring therein). That the following article la hereby propoeed as an amendment to the Constitution of the United SUtes, which shaU be valid to aU IntenU and purposes as part of the Constitution when ratified by conventions to three fovu'ths of tbe several SUtes: " ' ABTICLB — " ' Sscnoif 1. The eighteenth article of amendment to the Con- stitution of the United SUtes is hereby repealed. " ' Sbc. 3. The transporUtlon or lmp Mexico. (seal] ' Mrs. Marguerite P. Baca. Secretary of State of New Mexico. The State Canvassing Board or THE State or New Mexico. To all to whom these presents shall come, greeting: This is to certify that at a public election held in the State of Kew Mexico on September 19. 1933. pursuant to chapters 135 and 163 of the I«W8 of 1933. Miguel A. Gonzales, of Rio Arriba County, Abiquiu. NJyfex.. was duly elected to the office of delegate to a convention to be held in the senate chamber at the capitol in Santa Fe, lf.Mez.. upon November 2, 1933. at the hour of 12 noon for the purpose of ratifying an amendment to the Constitution of the United States relating to the repeal of the eighteenth amend- ment to the Constitution of the United States, he having there- tofore filed In the ofllce of secretary of state, pursuant to chapter 163 of the 1983 Session Laws, the following preelection pledge: Pledge of prospective candidate for delegate to a convention to vote upon the ratification or rejection of a proposed amend- ment to the Constitution of the United States rep>eallng the eighteenth Amendment to the C. County of Santa Fe, ss: Miguel A. Gonzales, being first duly sworn upon his oath, deposes and says that he is a prospective candidate for delegate to the convention called by the Governor of New Mexico for November 2. 1933, which convention is to be held in the senate chamber at the State capitol at Santa Pe. N.Uex., for the pur- po?e of ratifying the proposed amendment to the Oonstltution of the United States, which reads as follows: " ARTICLE — . " Section 1. The eighteenth article of amendment to the Con- stitution of the United States is hereby repealed. " Sec. 2. The transportation or Importation into any State, Territory, or possession of the United States for delivery or use therein of intoxicating liquors In violation of the laws thereof is hereby prohibited. "Sec. 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by conveptlona In the several States, as provided In the Constitution, within 7 years from the date of the submission hereof to the States by Congress." That he resides at Abiquiu. NMex., and has been a resident of the State of New Mexico for a period of 54 years; that in the event he is elected to the said convention he will vote for the ratification of said proposed amendment to the Constitution of the United States. Migttel a. Gonzales. Subscribed and sworn to before me this 5th day of April 1933. [SEAL] JosB A. Baca. Notary Public. My commission expires February 24, 1937. In testimony whereof we have hereunto set our hands and caused to be affixed the great seal of the State oC New Mexico this 16th day of October, AX>. 1988. A. W. HOCXSHHUU.. Gooemor of New Mexico. JOHM C. WSTSOK. Chief Justice of Mew Mexico. (SEAL] Mrs. Mabcujbutx P. Baca. Secretary of State of New Mexico. Trk State CAmrAasnre BoAse or THE SrsTC or New Mbsco. To all to whom these presents shall come, greeting: This Is to certify that at a public election held tn the State of New Mexico on Seiptember 19, 1933. pursuant to chapters 185 and 163 of the laws of 1933. Prager Miller, of Chaves County, RoeweU. N.Mex., was duly elected to the ofllce of delegate to a convention to be held in the senate chamber at the capitol at Santa Pe. NJkfex.. upon November 3. 1988. at the hour of 13 o'clock noon for the purpose at ratifying an amendment to the Constitution ot the United States relating to the repeal of the eighteenth amend- ment to the Constitution of the United States, he having thereto- fore filed in the office of secretary of state, pursuant to chapter 163 of the 1933 session laws, the following preelection pledge: Pledge of prosi}ectlve candidate for delegate to a convention to vote upon the ratification or rejection of a proposed amendment to the Constitution of the United States repealing the eighteenth amendment to the Constitution of the United States: State or New Mexico, County of Santa Fe, ss: Prager Miller, being first duly sworn, upon his oath deposes and says that he is a prospective candidate for delegate to the con- vention called by the Governor of New Mexico for November 2. 1933. which convention is to be held in the senate chamber at the State capitol at Santa Fe, N.Mex.. for the purpose of ratifying the proposed amendment to the Constitution of the United States, which reads as follows: "AKncuc — " Sbctson 1. The eighteenth artlde of amendment to the Con- stitution of the United States is hereby repealed. " Sec. a. The transportation or Importation into any State. Terri- tc»7, or possession of the United States for deUvery or use therein of intoxicating liquors. In violation of the laws thereof, is h««by prohibited. " Sec. 3. This article shall be Inoperative unless It shall have been ratified as an amendment to the Constitution by conventions in the several States, as provided In the Constitution, within 7 years from the date of the submission hereof to the States by tbc Congress." That he resides at 609 North Pennsylvania. Boswell, NMes.. and has been a resident of the State of New Mexico for a period of 5 or 6 yean; that in the event he Is elected to the said con- vention he will vote lor the ratifleatkm of said proposed amend- ment to the Coostittition of the United States. r Subscribed and sworn to before me this 8d day of April 1983. [sbal] Jose A. Baca, Notary FubUe. My commission expires February 27, 1987. In testimony whereof we have heretmto set our hands and caused to be affixed the great seal of the State ot New Mexico, thlsil6th day of October, AJD. 1988. A. W. HOCKCMHULL, Oovernor of New Mexico. John C. Watson. Chief Justice of New Mexico. [sxAL) Mis. MABCLnEBiTX P. Baca. Sceretarg of State of New Mexico. CONGRESSIONAL RECORD— SENATE with a tbe of ire oi of States In of propos ed Cons tl- the a ti- the Ckn Y<»k ihe r th ihe of ihe of dtly \he r th due ■l;ti 19 $3 Stages to 1he the c kSt can- Nbw ;er s, ahd the conventi on of of as 42 The VICE PRESIDIiINT also laid before the Senate a lett »r from the Governor o! the State of New York, transmittiJ ig original certificate of ratification of the amendment repeal ing the eighteenth amendment to the Constitution, whidti. with the accompanying papers, was ordered to lie on tlie table, as follows: State or N«w Yomc, ExEctmvi Chamber, Albany, August 1, 1933 The honorable the Prisidemt of the SenSte, Senate Office Building, j Washington, D.C. Bib: I have the honor to transmit to you herewith the orlgliAl certificate of ratification of the amendnjent repealing the elgl t- eenth amendment to th of New York, do hereby certify as follo\#8 1. The Congress of the United States duly proposed to the Stite of New York the proposed amendment to the United States stitutlon providing for the repeal erf the eighteenth article amendment to the Constitution of the United States reading follows : "akticle — " Section 1. The eighteenth article of tunendment to the C<^ ■tltutlon of the United SUtes Is hereby repealed. " Sec. 2. The transix>rtatlon or Importation Into any State, Tfer rltory. or poesesslon of the United States for delivery or use then -In of Intoxicating liquors in violation of the laws thereof Is hereby prohibited. " Sec. 3. This article shall be ln(^>eratlve unless it shall hive been ratified as an amendment to the Constitution by conventU ns in the several States, as provided in the Constlt.utlon, wlthlr years from the date of the submission hereof to the States by Congress." 2. After the State of New Ycwk had been officially Informed the Congress of the United States that the proposed amendm aforesaid had been duly acted upon by the Congress of the United States and submitted to the State of New York for consideration and action thereupon, the Legislature of the State of New duly passed an act which was approved by the Governor of State of New York, and which became a law on April 6. 1933. w th the approval of the Oovernor, and which act was passed by senate and the assembly of the State of New Yo'k. three fifths the members of each house being present at the time of the sage of the said act therein, the said act being chapter 143 of Laws of New York of 1933. 3. That In accordance with the provisions of said chapter 143 the Laws of 1933 of the State of New York delegates were nominated by petitions which were duly fi.led in the office of secretary erf state of New York and thereafter in accordance with the provisions of said act an election was duly held, after notice thereof as required by law. In the various flection dlstrljits throughout the State of New York on the 23d day of May between the hours of 12 o'clock noon and 10 pjn.. at which siich election 150 delegates were duly elected by paper ballots to ccn- i sider and act upon the proposed amendment to the United Constitution repealing the eighteenth article of amendment said Constitution as submitted to the State of New York by Congress of the United States. 4. Iliat In accordance with the provisions of chapter 143 of Laws of 1933 of the State of New York the result of the votes at such election in the several election districts were duly vassed and returned to the secretary of state of the State o» York within 10 days after said election, arxi immediately thereaf the siUd secretary of state prepared a list of the elected delegat^ causeil the same to be tiled in the department of state mallei to each delegate a certificate of his election. 5. That in and by chapter 143 of the Laws of 1933 of the St4t« of New York the delegates hereinbefore referred to elected at election held on May 23, It 33, were directed to meet in in the assembly chamber In the capltol in the city of Albaiiy State of New York, on Tiesday, June 27. 1933. at the hotor 11 a.m. to consider and a(t upon the ratification of the "^mpi^d January 4 ment providing for the repeal of the eighteenth article of amend- ment to the Constitution of the United States as proposed by the Congress of the United States to the State of New York. 6. That due notice of the time and place of such meeting was duly given to each of the 150 delegates elected as aforesaid by the secretary of state of the State of New York. 7. That the delegates to the convention aforesaid, in accordance with the provisions of said chapter 143 of the Laws of 1933, met at the assembly chamber at the capitol In the city of Albany, in- the State of New York, on Tuesday, June 27, 1933, at the hour of 11 a.m., and that they constituted an official convention to pass upon the question of whether or not the proposed amendment to the Constitution of the United States should be ratified. 8. The meeting of the convention of said delegates. In accord- ance with the provisions of said chapter 143 of the Laws of 1933 was called to order by the Honorable Herbert H. Lehman, Governor of the State of New York, and each delegate took and filed the constitutional oath of office before commencing to act as such delegate. 9. The call of the convention was read by the Honorable Edward J. Plynn, secretary of state of the State of New York. Upon such call it was disclosed that the following delegates were absent : Nicholas Murray Butler. William M. Calder, Stephen CaUaghan. Rot)ert E. Christie, Jr., Livingston Farrand. Leonard Lipowlcz, Joseph V. McKee, John O. Saxe, Herbert Bayard Swope. 10. In accordance with the provisions of said chapter 143 of the Laws of 1933 the vacancies In the convention caused by the ab- sence of the delegates aforesaid were filled by appointment by a majority of the delegates comprising the group from which said absent delegates were elected of the following: Jane Qulntard Clark. In place of Nicholas Murray Butler; Donald A. Dalley. In place of Robert E. Christie, Jr.: James A. Farley. In place of Herbert Bayard Swope; Edward J. Flynn, in place of Joseph V. McKee; T. Frank Gorman, in place of John G. Saxe; W. Klngsland Macy, in place of Livingston Farrand; William L. Marcy, Jr.. in place of Leonard Llpowicz; Charles F. Murphy, In place of WlUlam M. Calder; Rosa M. Turk, In place of Stephen Callaghan. 11. The delegates so substituted thereupon duly took and sub- scribed to the constitutional oath required by said act, which oatha were duly filed as required by law. 12. Each of the 150 persons elected as delegates to the said convention and each of the 9 persons so appointed as substitute delegates thereto was at the time of his election and at the time of the holding of said convention a citizen and Inhabitant of the State of New York. 13. The convention then proceeded to the election of Its presi- dent, secretary, and other officers, and the following officers were duly unanimously elected as the officers of said convention: President. Alfred E. Smith; honorary president, EUhu Root; first vice president, James W. Wadsworth; second vice president, Harriet T. Mack; secretary, Ruth B. Pratt; assistant secretaries, Vincent Dalley. Raymond J. O'SulUvan. George W. Harder, George H. Payne; and parliamentarian, John T. Doollng. 14. By resolution duly presented, seconded, and unanimously adopted, the president of the convention was authorized to ap- point stenographers, sergeant at arms, and other employees, and to fix the compensation of such stenographers and employees. 15. On taking the chair the president, Alfred E. Smith, ad- dressed the convention. 16. Upon assuming the duties of their respective offices the honorary president, first and second vice presidents, and secretary also addressed the convention. 17. By resolutions duly presented, seconded, and unanimously carried the president was authorized to appoint the following committees : Committee on rules, consisting of 16 members; committee on credentials, consisting of 18 members; committee on resolutions, consisting of 16 members. 18. The president appointed the following delegates members of the committees aforesaid: 19. Committee on credentials: Charles H. Tuttle (chairman), Warren B. Ashmead, William R. Bayes. Peter C. Brashear, Martin Cantine. Ruth Mason Cook, James G. Harbord. Prank L. Wiswall, David A. Avery. Benjamin S. Dean, Nlsbet Grammer, Warnlck K. Keman, John L. Buckley. Louis A. Cuvillier, Nora Qulnn. Thomas G. Ryan. 20. Committee on rules: Russell Wiggins (chairman). Melvln C. Eaton, Christiana M. Greene. Samuel 8. Koenlg, George J. Moore, Albert Ottinger, Bayard J. Stedman, William Ziegler, Jr., Mary C. Slnclalre, Ellen Schaeffer, Edward P. Lynch, Charles J. Knapp, Ashley T. Cole, Dorothea Courten, Algernon Lee. Irwin Stelngut. 21. Committee on resolutions: Pauline Morton Sabin (chair- man). Donald A. Dalley, Fred J. Douglas, Julia D. Hanson, George Z. Medalie, Mary Stillman Harkness. John H. Kitchen, Fred J. H. Kracke, Henry Rogers Wlnthrop, Alfred E. Smith (ex officio), James P. B. Duffy. Irene 0"D. Ferrer, Ann Murray Flynn, Ken- neth Gardner. John J. Dunnlgan, Dennis J. Mahon, Grayson M. P. Murphy. 22. Hon. Russell T. Wiggins, a delegate, presented a resolution providing that until the committee on rules submitted Its report the rules of the Assembly of the State of New York for the year 1933 be adopted as the temporary rules of the convention, which resolution was unanimously adopted. 23. By resolution, duly presented, seconded, and unanimously adopted, a recess was taken to permit the committees on rules. 1934 CONGRESSIONAL RECORD— SENATE 43 resolutions, and credentials to consider, prepare, and submit their reports. 24. Thereafter, when the committees advised the president that they were ready to submit their reports, the convention recon- vened, and Hon. Russell T. Wiggins, chairman of the committee on rules, submitted the report of said committee, recommending that the rules of the Assembly of the State of New York for the year 1933 be adopted as the rules of the convention, which report was duly accepted; and thereafter, by motion duly made, seconded, and unanimously carried, the rules of the Assembly of the State of New York were duly adopted as the rules of the convention. 26. The Hon. CTharles H. Tuttle, chairman of the committee on credentials, submitted his report — that there were no contests; that ISO delegates, whose names appeared on the temporary roll of the convention as certified by the secretary of state, had been duly and legally elected; that all of said delegates were present and had qualified except the nine hereinbefore named who were Absent; that there had been duly and lawfully substituted In place of the absent delegates the following delegates: Jane Qulntard Clark. In place of Nicholas Murray Butler; Donald A. Dailey, in place of Robert E. Christie, Jr.; James A. Parley. In place of Herbert Bayard Swope; Edward J. Plynn, in place of Joseph V. McKee; T. Frank Gorman, in place of John O. Saxe; W. Kingsland Macy. in place of Livingston Farrand; William L. Marcy, Jr., In place of Leonard Lipowicz; Charles F. Murphy, in place of William M. Calder; Rosa M. Turk, in place of Stephen Callaghan. Tlxat 150 delegates chosen in accordance with law were present; and that there was no contest affecting the seat of any delegate nor any question raised of his or her right to participate in the convention. 26. Mrs. Pauline Morton Sabin. chairman of the committee on resolutions, submitted the report of said committee and moved its adoption, a copy of which report is annexed hereto and marked " Exhibit A." After the report of the committee on resolutions had been read by Mrs. Pauline Morton Sabln, chairman of said committee, the following delegates addressed the convention on the subject matter of the resolutions and seconded her motion: Hon. Thomas H. Cullen. of Brooklyn. NY. Hon. John J. O'Connor, of New York City. Mrs. Alice Campbell Good, of Brooklyn, N.Y. Hon. Aaron L. Jacoby, of Brooklyn. N.Y. Hon. Louis Waldman, of New York City. Mrs. Jeanie Rumsey Sheppard, of New York City, addressed the convention. 27. After all those who had desired to address the convention had completed their addresses, a resclution was duly presented, seconded, and unanimously carried that the report, as rea<} by the chairman of the committee on resolutions, be adopted, and the report was unanimously adopted. 28. A resolution was then presented which was duly seconded and unanimously carried providing that the main question shoxild then be put, and it was unanimously adopted. 29. The president declared that the motion had been carried and the question before the convention was on the adoption of the resolution ratifying the proposed amendment to the Con- stitution of the United States as proposed by the Congress of the United States repealing the eighteenth amendment to the United States Constitution, which said proposed amendment reads as follows: " AKTICU — " Sectiow 1. The eighteenth article of amendment to the Con- stitution of the United States is hereby repealed. " 8«c. 2. The transportation or importation into any State, Ter- ritory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof. Is hereby prohibited. " Sac. 3. This article shall be Inoperative unless It shall have been ratified as an amendment to the Constitution by conventions In the several States, as provided In the Constitution, within 7 years from the date of the submission hereof to the States by the Congress." Thereupon the president directed that the roll of the delegates be called, and the roll of the delegates was called by the secre- tary, Mrs. Ruth B. Pratt, who entered the vote by yeas and nays on the journal of the convention. SO. On this question 150 delegates answered yea. and no delegate answered nay. and the president then announced that the resolu- tion had been unanimously adopted and that the State of New York had. tn accordance with the provisions of the Constitution of the United States, the Joint resolution of Congress, and in accordance with the provisions of chapter 143 of the Laws of 1933. acted upon the ratification of the proposed amendment to the United States Constitution providing for the repeal of the eight- eenth amendment and bad ratified said proposed amendment pro- viding for the repeal of the eighteenth amendment. 31. A resolution was thereafter presented, duly seconded, and unanimoiuly adopted, authorizing and directing the proper offi- cers of the convention to prepare, execute, acknowledge, and file the certifk;ate8 required by chapter 143 of the Laws of 1933 In triplicate. 32. Thereafter upon motion duly made, seconded, and carried the convention adjourned sine die. Dated, July 26. 1933. Altrkd E. Smith. President. Btrra B. Pxatt. Secretary. Btatk or N«w To«K, CoMnry of New York. a$: Alfred E. Smith and Ruth B. Pratt, being each separately duly sworn on oath each for himself and b«r«eU. doss hereby certify and depose as follows: That the said Alfred E. Smith is the duly elected chairman of the State convention held at the assembly chamber In the capttol. in the dty of Albany. N.Y.. on Jxins 37. 19SS. and the said Ruth B. Pratt is the duly elected secretary of the convention held In the assembly chamber in the capitol. in the city of Albany. N.T.. on June 27. 1933; that at said convention there were present and entitled to vote therein 150 delegates on the question ot ratifica- tion of the following amendment to the Goostltutlon of tbe United States: " aancu — "Sacnoif 1. The eighteenth article of amendment to the Coa- stltutlon of the United States is hereby repealed. " Sec. 2. The transportation" or Importation into any State, Ter- ritory, or possession of the United States for delivery or use therein of Intoxicating liquors, in Tlolatlon of tlic laws thereof. Is hereby prohibited. " Sac. 3. This article AhaU be Inoperative ttnleai It shall have been ratified as an amendment to the OonsUtutlon by convcntkms In the several States, as provided In the Constitution, within 7 jrears from the date of the submission hereof to the States by the Congress." That the 160 delegates who were entitled to 160 votes sast a luumimous vote In favor of ratlllcaUon of said article and that no delegate present, entitled to vote, cast his or her vote acalnst ratification of said article; that all votes cast were in favor of ratification and said article was by said convention duly ratified: that annexed hereto and made a part hereof is a full, true, and complete record of the proceedings had and taken and of things done by said convention held in the assembly chamber at the capitol. in the city of Albany. In the State of New York, on Tues- day. June 27. 1933. which fiilly shows the result of votes taken, showing the yeas and nays, haid at said convention on the ques- tions submitted Altxed K. Siotb. RtTTH B. PSATT. Subscribed and sworn to before me this SOth day of Jxily. 1933. John L. Dooums, Notary Public. New York County. EXHIMT A Whereas the Senate and Hotxse of Representatives of the United States of America in Congress assembled (two thirds of each House concxirring therein) did resolve that the following article is hereby proposed as ah amendment to the Constitution of the United States, which shall be valid to all Intents and purposes as a part of the Constitution when ratified by convention In three fourths of the several States; and Whereas the said proposed amendment reads as follows: " Section 1. The eighteenth article of amendment to the Consti- tution of the United States is hereby repealed. " Sbc. 2. The transportation or importation into any State, Terri- tory, or possession of the United States for delivery or use therein of intoxicating liquors, In violation of the laws thereof Is hereby prohibited. "Sac. 3. This article shall be inoperative unless it shall hare been ratified as an amendment to the Constitution by conventions in the several States, as provided in the Constitution, within '^ years from the date of submission hereof to the States by the Congress "; and • Whereas there was duly transmitted to the legislature of this State the said article of amendment proptosed by the Congress to the Constitution of the United States; and Whereas the legislature of this State, pursiiant to law. did enact a statute entitled "An act to provide for a convention to consider and act upon the ratifi.cation of the amendment to the United States Constitution providing for the repeal of the eighteenth amendment ", which said act. having passed both houses of the legislatvire, was signed by the Governor of this State on April 6, 1933. and constitutes chapter 143 of the Laws of New York for the year 1933; and Whereas, pursuant to the provisions of said act of the legis- lature, an election for the selection of delegates to the said con- vention was held In this State on May 23, 1933, at which said elec- tion 150 delegates were chosen in accordance with the provisions of said statute; and Whereas the secretary of state has prepared a Ust of the dele- gates elected at said election and the same has been filed in the department of state, and the secretary of state has In aooordanoe with the provisions of the said statute given notice ct the time and place of the holding of the convention, which said notice reads as follows: " Dea« Sni OB Madam : Tou are hereby notified that the New York State convention to act oo the amendment to tbe eighteenth article of the Constitution of the United States wlU convene In the assembly chsmber at the capitol. Albany, on Tuesday. June 27. 1933, at 11 a.m. eastern daylight saving time. It Is expected the convention will be in session approximately 8 hours. " If for any reason you find it impossible to attend, vrlll you please notify me to that effect so that the vacancy caused toy your absence may be fUled? I ^ 44 CONGRESSIONAL RECORD— SENATE January 4 •• TTiere Is enclomd herewith a blank oath of office which you »i • requMited to execute and return to thla department at the earllftt poaalble moment. " Very truly youra, " Edwaia J. Fltww. " Seeretaty of State." And. ^ ^ Wboreai, pursuant to the said notice and as provided in said act the said convention has met at the time and pl»ce therein flwd and has organized by the election of a president, first and aecotd vice presidents, secn-tary, and other officers, and has adopted rulss goveriung lu deliberations and Is ready to proceed to consider tl le proDOHed article of amendment: Now. therefore, be It Resolved by thia convention, of the delegatea repretenting t).e peopU- 0/ the State of New York duly assembled jrurtuant to law, That we do approve and ratify the proposed article of amendment propoNed by the Congress to the Corutttutlon of the United Statss designed to refieal the eighteenth article of the amendment, whl^h said amendment reads as follows: "Whereas the Senate and House of Representatives of t|e United States of America In Congress assembled (two thirds of each House concurring therein) did resolve that the followliig article Is hereby proposed as an amendment to the Constltutidn of the United States, which shall be valid to all Intents and pur poses as a part of the Constitution when ratified by conventions In three fourths of the several States: and "Whereas the said proposed amendment reads as follows: " ' 8»cnoK 1 . The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. " * See. 2. Tlie transportation or Importation Into any State, Te^ rltory. or possrsalon of the United States for delivery or use there n of Intoxicating liquors In violation of the laws thereof Is hereby prohibited. " ' Sic. 3. This article shall be inoperative unless It shall h&fe been ratified as amendment to the Constitution by conventions In the several States, as provided In the Constitution, within ! 7 years from the date of submission hereof to the States by tlie Congress.' "And, fvirther. the action of this convention In approving aitd ratifying the nald proposed amendment Is valid to all intents and purposes as representing the people of the State of New York; and be It fxirther "Resolved, That the chairman and secretary of this conventliin chall certify the result of the votes of the delegates to the ratiflcfi- tlon of said amendment in triplicate, each signed by the presldeht and secretary of the convention, to which there shall be attach^ a certificate, certified by such officers, of the record of the v(i« taken, showing the yeas and aays thereon, and that such certifi- cates and certified copies of such record shall be deposited with the secretary of state of the State of New York, and he shall transnut one such certificate and certified copy of such record to the Secit- tary of State of the United States, another certificate and certified copy of such record to the presiding officer of the Senate of the UnltiKl States, and another certificate and certified copy of suth record to the Speaker of the House of Representatives of the UnlUKi States, which said certificates shall be accompanied by the certificate of the secretary of state certifying that the i>ersoh3 slgnlog the certificates so transmitted were the duly constituted president and secretary of said convention and that their sig- natures are genuine, and that before transmitting the certificates and ooples of records so deposited with the secretary of state he shall make a copy of one of them, verifying It as such, and record It as a permanent record of the department of state; and be ]lt further l "Ritsolved, That the president, secretary, and any other officer bf this convention and the delegates and secretary of state, or any >r either of them, are hereby authorized to comply with any act )r resolution of Congress reciulrlng other or further confirmation )f such ratification or rejection of said proposed amendment." State convention of delt>gates held in the assembly chamber a the capitol, in the city of Albany, in the State of New York, (n Tuesday, June 27. 1933. at the hour of 11 ajn., to consider and act upon the ratification oi the proposed amendment to the Unlttd Statei< Constitution providing for the repeal of the eighteen a amendment to the United States Constitution. In accordance wi ua the provisions of chapter 143 of the Laws of 1933 of the State f New York. Kzporr or tally clxkk or thi rxcobo or the votx takxs on tiib QtTKKTION or HATinC.tTION OF THE AMENDMENT TO THE CONSTITtmC N or THE UNITED STATES PROPOSED BY THE CONCKESS OT THE UNIT! O STATES TO THE SEVERAL STATES IN ACCORDANCE WITH THE PBOVISIOl TS or CHAPTER 1-13 Or rHE LAWS OF 1933 ThoHe who voted In favor of ratifying the amendment: Willie n S. Andrews, Benjamin Antln. Warren B. Ashmead. David A. Averj?, Selden Bacon. William R. Bayes, Peter C. Brashear. Thomas A. Brogaii. Charles. E Buchner. John L Buckley, Nathan Burkaji. Martha Byrne. Martin Cantine. Edward T. Carroll. Mary Chahooh. John S. Chapman, Joseph H. Choat*;. Jr., Jane Qulntard Clare, Ashley T. Cole. Clarence F. Conroy. Ruth Mason Cook, Frederic I. Coudeit Jr.. Dorothea Coiirten, John R. Crews, William Nelsc n CromweJ, Thomas H. Cxillen. Henry H. Curran, John P. Curry, Robert P. Cutler, Louis A. Cuvllller. Donald A. Bailey, May Davje. Archie O. Dawscn. Benjamin S. Dean. William P. Delaney. Fred i. Douglas, James P. B. Emffy. John J. Dunnigan. James P. Dwyt r. Keron P Dwyer, Melvn C. Eaton, George Ellpem, Albert E. Pac i. James A. Farley. Irene OT>. Ferrer, Ann Murray Flynn. Edward J. Flynn Francis E. Fronczak. Kenneth Gardner. Abraham S. Gilbert, Harrison C. Olore, Alice Campbell Good. May M. Oooderson, T. Frank Gorman, Nlsbet Grammer, Christiana M Greene, Julia D, Hanson, James G. Harbord. Mary Stlllman Harkness. Louis B. Hart. Robert W Hlgble, Jr. Charles D. Hilles. Katherlne 8 Hinckley. Thomas L. Holllng. Settle P. Holmes, Ferdinand R. Horn, Jr.. Wlnfield A, Huppuch. Cornelius Huth. Joseph 8. Israel. Aaron L. Jacoby. Ralph Jonas. Samuel J Joseph, Frank V. Kelly, Warnlck K. Keman, John Hill Kitchen. Charles J. Knapp. Samuel 8. Koenlg. Frederick J. H. Kracke. Ernest Lappano. John E. Larney, Algernon I>e. E>avld F. Lee. Isabella R. Lovell, A. Augustus Low, Edward P. Lynch. John D. Lynn. James J Lyons. John H. McCooey. Peter McGovem, William N. Mcllravy, Terrence J. McManus, Harriet T. Mack. W. Klngsland Macy. Dennis J. Mahon, William L. Marcy. Jr., George Z. Medalle, Chase Mellen. Jr., George J. Moore. Thomas E. Morrissey. Edward P. Mulrooney, Charles P. Murphy, Grayson M. P. Mtirphy. Vincent B Murphy. lone NlcoU, Godfrey Nurse. John J. O'Connor. Marion O'Connor, Albert Ottlnger. Nathan D Perlman, Rosalie S. Phillips, Generoso Pope, Ruth Baker Pratt. Nora ^uinn. Ellhu Root, Thomas G Ryan. Pauline Morton Sabin, Joseph J. Sartorl. Helen Schaeffer, Edward Schoeneck. Elenore Sefton. Jsmes R. Sheffield, Jeanie Rumsey Sheppard. Mary C. Sinclalre, Alfred B. Smith. Homer P. Snyder, James Speyer, Bayard J. Stedman, irwin Stelngut. Samuel Strasbourger. John Sullivan, Arthur Sutherland. John Boyd Thacher, John Theofel. Hamilton Travis. Harold L. Turk. Rosa M Turk, Charles H. Tuttle, James W. Wadsworth. Louis Waldman. Robert E. Whalen. Charles S. Whitman, Gustav W. M. Wieboldt, Russell Wiggins. Elizabeth C. Wing. Henry Rogers Win- throp. Frank L. Wiswall. Elsie C. Woodward. James A. Zlckler, William Zlegler. Jr.. and Walter W. Zittel. Yeas, 150; nays. 0. We the undersigned, Alfred E Smith, the president, and Ruth B. Pratt, the secretary, of the State convention of delegates held in the assembly chamber in the capitol In the city of Albany in the State of New York on Tuesday. June 27. 1933, to consider and act upon the ratification of the proposed amendment to the Constitution of the United States providing for the repeal of the eighteenth article of amendment to the Constitution of the United States do hereby certify that the foregoing is a true copy of the record of the vote taken, showing the yeas and nays on the resolution by which said convention agreed to the ratification of said proposed amendment. Alfred E. Smith, President. RtJTH B. Pr.\tt, Secretary. State or New York, Department or State, Albany. I, Edward J. Flynn, secretary of state of the State of New York, In accordance with the provisions of chapter 143 of the Laws of 1933 of the State of New York, do hereby certify that Alfred E. Smith was the duly constituted president and that Ruth B. Pratt was the duly constituted secretary of the State convention of delegates held In the assembly chamber In the city of Albany in the State of New York on Tuesday, June 27, 1933, to consider and act upon the ratification of the proposed amendment to the Constitution of the United States providing for the repeal of the eighteenth article of amendment to the Constitution of the United States; that I am familiar with the handwriting of said Alfred E. Smith and said Ruth B. I^att, and that their signatures upon the foregoing certificates are genuine. In witness whereof I have in accordance with the provisions of chapter 143 of the Laws of 1933 of the State of New York, subscribed my name as secretary of state of the State of New York and affixed the great seal of the State of New York at the capitol in the city of Albany in the State of New York the 31st day of July 1933. I seal) Edward J. Flynn. Secretary of State of the State of Sew York. The VICE PRESIDENT also laid before the Senate docu- ments transmitted by the secretary of state of the State of Utah, certifying to the ratification by a duly elected con- vention representing the State of Utah of the amendment to the Constitution repealing the eighteenth amendment thereto, which were ordered to lie on the table, as follows: State or Utah, ExECirrivE Department. I, Milton H. Welling, secretary of state of the State of Utah, hereby certify that R. L. Olson was duly constituted president, and that Mrs. Paul Key.9er was duly constituted secretary of the State convention of delegates held in the hall of the house of representatives at the State capitol In the city of Salt Lake, In the State of Utah, at 12 o'clock noon on Tuesday, December 5. 1933, to consider and act upon the ratification of the proposed amendment to the Constitution of the United States providing for the repeal of the eighteenth article of amendment to the Constitution of the United States; that I am familiar with the handwriting of said R. L. Olson and said Mrs. Paul Keyser. and that their signatures upon the attached certificates are genuine. In witness whereof I have set my hand and affixed the great seal of the State of Utah, at Salt Lake City, Utah, this 5th day of December. AJD. 1933. l^aaLj Milton H. Welling. Secretary of State of the State of Utah. CT^XT A rnj? T * XTTT A Dir A 1934 CONGRESSIONAL RECORD— SENATE \ 45 Oertlflcate attesting ttie mtlflcatlon. by • duly elected convention representing the StAte of Utah, of an amendment to the Conatltutlon of the United State*, proposed by the Congreaa of the United StaUs We, the undersigned. R. L. Olffon. the president, and Mrs. Paul Keyser. the secretary of the State convrntlon of delegates, held In the hall of the hoxisc of representatives at the capttof In Salt Lake City, State of Utah, on Tuesday. December 5. 1933, at 12 o'clock noon, to consider and act upon the rctlflcatlon of a proposed ametwlment to the Constitution of the United States, in accord- ance with the provisions of chapter 32. Laws of Utah. 1033, do hereby certify as follows: 1. The Congress of the United States duly certified to the State of Utah a proposed amendment to the Constitution of the United States, reading as follows: "akticl* — " SccnoN 1. The eighteenth article of amendment to the Con- stitution of the United States is hereby repealed. " Sec. 2. The transportation or Importation into any State. Territory, or possession of the United States for delivery or use therein of intoxicating liquors, in violation of the laws thereof, is hereby prohibited. " Sbc. 3. This article shall be inoperative unless it shall have been ratified as an amendment to the Constitution by conventions In the several States, as provided in the Constitution, within 7 years from the date of the submission hereof to the States by the Coni^ess " 2. After the State of Utah had been officially informed by the Congress of the United Stat«8 that the proposed amendment afore- said had been duly acted upon by the Congress of the United States and submitted to the State of Utah for consideration and action thereon, the Legislature of the State of Utah duly passed an act designated as chapter 22, Laws of Utah, 1933, which was approved by the Governor of the State of Utah, and which became a law on March 21, 1933. 3. In accordance with th« provisions of said chapter 22. Laws of Utah. 1933. delegates wen? duly nominated by petitions legally filed in the office of the sf-cretary of state of Utah a«id thereafter in accordance with the provisions of said act. an election was held, after due notice thereof as required by law. in the various election districts throughout the State of Utah on the 7tb day of November 1933 at which such election 21 delegates were duly elected to consider and act upon the aforesaid proposed amend- ment to the Constitution of the United States. 4. The board of State canvassers, meeting according to law In the office of the secretary of state at noon. November 27. 1933. did canvass the returns of the aforesaid election, and by their computation did find that the 21 delegates for ratification of the proposed amendment to the Constitution of the United States received a greater number of votes than the 21 delegates against ratification of the proposed amendment to the Constitution of the United SUtes. 5. That Milton H. Welling, secretary of state of the State of Utah, did certify that the following 21 delegates, pledged to vote for ratification of the proposed amendment to the Constitution of the United States, are the duly elected delegates to a constitu- tional convention which by law is called to convene at 12 o'clock noon. Tuesday. IDecember 5. 1933. at the capitol In Salt Lake City, to ratify, as representing the people of the State of Utah, the proposed article of amendment to the Constitution of the United States: Glen O. Allred, Price; George 8. BalUf. Provo; Clarence Bam- berger. Salt Lake City; John O. Beesley, Provo; Ephralm Bergeson, Cornish; Sophus Bertelson. Ephralm: A. S. Brown, Salt Lake City; Lawrence Clayton. Ogden: T. Earl Clements. Park City; Mlah Day, PiUmore; A. C. Ellis. Jr., Salt Lake City; Mat Gilmour, Price; L. B. Hampton. Salt Lake City; Franklin Hansen. Moroni; Mrs. John A. Hendricks. Ogden; L. A. HoUenbeck, Duchesne; Mrs. L. B. Mc- Comick, Salt Lake City; R. L. Olson. Ogden; Mrs. S. Grover Rich, Salt Lake City; Franklin Rlter. Salt Lake City; Sam D. Thurman. Salt Lake City. 6. The delegates to the convention aforesaid. In accordance with the provisions of said chapter 22. Laws of Utah, 1933, met In the hall of the house of representatives at the capitol In Salt Lake City In the State of Utah on Tuesday, December 5, 1933, at 12 o'clock noon, and that they constituted' an official convention pledged to vote for the above-proposed amendment to the Con- stitution of the United States. 7. The delegates to the aforesaid constitutional convention, held in accordance with the resolution of the Congress of the United States and the provisions of said chapter 22, Laws of Utah, 1933. Invited His Excellency Henry H. Blood. Governor of Utah, to call the convention to order and to preside over its temporary organl- ration. Accordingly, the convention was called to order by the Honorable Henry H. Blood at 12 o'clock noon, December 5, 1933. 8. The certificate of election of delegates to the convention was read by the Honorable Milton H. Welling, secretary of state of the State of Utah. The roll was then called, and it was disclosed that one delegate was absent, namely, Mrs. S. Grover Rich. 9. In accordance with the provlsion.s of chapter 22, Laws of Utah, 1933, the vacancy in the convention caused by the absence of the delegate aforesaid was filled by the election, by unanimous vote, of Mrs. Paul Keyser. 10. The 21 delegates to the convention thereupon subscribed to the constitutional oath of office prescribed by the State of Utah before •ntcrlng upon tbstr ofllelai duties, said o*Ui beinf adminis- tered by Chief Justice of the Supreme Court at Utah D. M. Straup. 11. The convention then proceeded to the election of Its presi- dent, vice president, and secretary, as follows: President. R. L. Olson; vice president. Clarence Bamberger: and •ecreUry, Mrs. Paul Keyser. The oath of office being administered by Chief Justice of the Supreme Court of Utah D. N. Straup to the officers of the con- vention. 12. President R. L. Olson delivered his formal address to the delegates of the convention. After concluding his address he Intro- duced His Excellency. Henry H. Blood. Governor of Utah, who also addressed the convention. 18. By resolution duly adopted, the president was autttorlaed to appoint the following committees: Committee on credentials, consisting of 10 members, as foUowi: Sam D. Thurman (chairman). John O. Beesley, T. Bart Clements. Franklin Hansen, Mrs. L. B. McCornlck. Glen O. Allred. Bophus Bertelson. Mlah I>ay. Mrs. John A Hendricks. Ephralm Bergeson. Committee on resolutions, consisting of 10 members, as follows: Franklin Rlter. chairman. Clarence Bamberger. Lawrence Clayton. Mat Gilmoiur. L. A. HoUenbeck. George S. Ballif . A. S. Brown. A. C. Ellis. Jr.. L. B. Hampton. Mrs. Paul Keyser. 14. By special invitation of the delegates the convention was addressed by the Hon. Anthony W. Ivins. a member of the State constitutional convention held May 8, 1895. T«'elve members of said constitutional convention were present as special guests of the convention. 15. The convention recessed to permit the conunittees on creden- tials and resolutions to consider, prepare, and subnxlt their reports. Thereafter the convention reconvened. 16. Sam D. Thurman. chairman of the conunlttee on credentials, reported as follows: " To the president and members of that certain conr>ention held at Salt Lake City, Utah, December 5, 1933, to consider the rati- fication of the proposed twenty-first article of amendment to the Constitution of t?ie United States of America: " Tour committee has met, examined the roll of delegates as prepared by the secretary of state, and his certificate of election, and has found the same to be correct, and that the delegates named in said certificate of election had been dxily elected, and that there were no contests; and reports that the delegates as cer- tified to the convention by the secretary of state, together with Mrs. Paul Keyser, of Salt Lake City, who has been elected a dele- gate to this convention to fill the vacancy created by the absence of Mrs. S. Grover Rich, are the accredited delegates of this con- vention. " They are as follows : " Glen O. Allred, Price; George S. Ballif, Provo: Clarence Bam- berger, Salt Lake City; John O. Beesley, Provo; Ephralm Bergeson. Cornish; Sophus Bertelson, Ephralm; A. 8. Brown. Salt. Lake City; Lawrence Clayton, Ogden; T. Earl Clements. Park City; Miah Day. Fillmore; A. C. Ellis. Jr.. Salt Lake City; Mat Gilmour. Price; L. B. Hampton. Salt Lake City; Franklin Hansen, Moroni; Mrs. John A. Hendricks, Ogden; L. A. HoUenbeck, Duchesne; Mrs. Paul Keyser, Salt Lake City; Mrs. L. B. McCornlck, Salt Lake City; R. L. Olson. Ogden: Franklin Rlter, Salt Lake City; and Sam D. Thurman, Salt Lake City.'* The report of the committee was unanlmotisly adopted. 17. Franklin Riter, chairman of the committee on resolutions, submitted the report of said committee and moved its adoption, a copy of which report is annexed hereto and marked "Exhibit A." The committee report was unanimously adopted. 18. The President declared that the main question was now before the convention, namely, a " yea-and-nay " vote on the adoption of the resolution ratifying the proposed amendment to the Constitution of the United States as proposed by the Congress of the United States, repealing the eighteenth amendment to the Constitution of the United States, which proposed amendment reads as foUows: "abticib — " Sbction 1. The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. " Sec. 2. The transportation or importation Into any State. Ter- ritory, or possession of the United States for delivery or use therein of Intoxicating liquors. In violation of the laws thereof. Is hereby prohibited. " Sac. 3. This article shall be Im^terative unless It shall have been ratified as an amendmei^ to the Constitution by oonventi<»u In the several States, as provided In the Constitution, within 7 years from the date of the submission hereof to the States by the Congress." Thereupon the president directed that the roll of the delegates be called, and the roll of the delegates was called by the secretary, Mrs. Paul Keyser. who entered the vote by " yeas " and " nays " on the journal of the convention. 19. On this question 21 delegates answered " yea " and no dele- gate answered " nay ", and the president then announced that the resolution had been unanimously adopted and that the State of Utah. In accordance with the provisions of the Constitution of the United States, the joint resolution of Congress of the United States, and in accordance with the provisions of chapter 22. Laws of Utah, 1933, had ratified the proposed amendment to the Con- stitution of the United States providing for the repeal of the eighteenth amendment. Such ratification, as representing the 46 CONGRESSIONAL i RECORD— SENATE January 4 people of the State of Utah, occurred at 3:32'^ o'clock pjn Tue^ay. I>?cember 5, 1933 20. Upon motion duly made, seconded, and carried, the conven- tion adjouraed sine die. R. L. OusoK. President. Mrs. Paul Kktser. Secretary Subscribed and sworn to before me this 5th day of December A D. 1933. [seal] Fbank E. Lkbs, Notary Public. BxHiarT A Report of ccmmlttee on resolutions to the president and member^ of that certain convention held at Salt Lake City, Utah, Decern ber 5. 193a. to consider the ratification of the proposed twenty first article of amendment to the Constitution of the Unlti States of iVmerlca The committee on resolutions has met and has carefully con sldered the question of acting upon the ratification of the pr posed twenty-first article of amendment to the Constitution of th United States of America, providing for the repeal of the eightl eenth amendment to the Constitution of the United States m America, and we recommend the adoption of the followlni resolution : " Resolution " Whereas the Senate and House of Representatives of thi i United States of America In Congress assembled (two thirds o each House concurring therein) did resolve that the followlni: article Is hereby proposed as an amendment to the Constitution c ' the United States, which shall be valM to all Intents and purposeii as part of the Constitution when ra*-lfled by conve-xtlons In threortatlon or Importation Into any State, Ter- ritory, or poKsesblon of the United States for delivery or uas therein of Intoxicating liquors In violation of the laws thereof in hereby prohibited. "'Sec. 3. This article shall be Inoperative unless It shall hav(! been ratified a.s an amendment to the Constitution by convention \ In the several States, as provided in the Constitution, within " ' years from tht; date of the submission hereof to the States by thi : Congress '; and "Whereas the legislature of this State, pursuant to Its consti- tutional authority, did enact a statute entitled 'An act to provldn for convenions to pass on amendments to the Constitution of th; United States which have or may hereafter be proposed by Congresi i for ratification by conventions of the several States', which said statute, having passed both houses of the legislature of this State, was signed by the Governor of this State on March 21, 1933. and constitutes chapter 22, Laws of the State of Utah, twentieth regular session of the legislature. 1933: and " Whereas on August 10, 1933. Gov. Henry H. Blood proclalme* I that an election for the election of 21 delegates to attend a con stltutlonal convention to be l)eld at Salt Lake City. December £, 1933. to ratify or reject the above proposed amendment to th t Constitution of the United States, to be held November 7, 1933 and " Whereas nominating petitions containing the required numbe ' of names were filed with the secretary of state for 21 delegates to the aforesaid constitutional convention for ratification of thi! proposed amendment to the Constitution of the United States and " Whereas nominating petitions containing the required numbe - of names were filed with the secretary of state for 21 delegates to the aforesaid constitutional convention against ratification o' the proposed amendment to the Constitution of the United States and " Whereas, pursuant to the provisions of said statute of th » legislature, an election for the election of delegates to said con vention was held in this State on November 7, 1933, at which sal( election 21 delegates were chosen in accordance with the provl slons of said statute; and " Whereas the board of State canvassers, meeting according t > law In the office of the secretary of state at noon. November 21, 1933. did canvass the returns of the aforesaid election, and by thel: ' computation did find that the 21 delegates for ratification o the proposed amendment to the Constlt^utlon of the United State i received a greater number of votes •lan the 21 delegates agalns ; ratification of the said proposed amendment to the Constltutloi i of the United States: and " Whereas Milton H. Welling, secretary of sUte of the State o Utah. did. under his hand and the great seal of the State of Utah at Salt Lake City. Utah, on the 28th day of November 1033. certif ' that the following 21 delegates, pledged to vote for rstmcatloii of the proposed amendment to the Constitution of the Unlte< States, are the duly elected delegates to the Constitutional Con - ▼entlon which, by law. is called to convene at 12 o'clock noon December S. 1033. at the rapitol In Salt Lake City: "Olen O Allred. Price: George 8 Balllf . 'Provo: Clarence Bam berger. Salt Lake City: John O Beesley. Provo: Ephralm Bergeson, Cornish: Sophua Bertelson. Ephralm; A. S. Brown. Salt Lake City Lawrence C1a;'ton. Ogden: T. Earl Clements. Park City; Mlali Day. Fillmore: A, C Ellis Jr . Salt Lake City; Matt Gilmour. Price L. B. Hampton. Salt Lak« City; Pranklln Hansen. Moroni; Mn, John A. Hendricks, Ogden: L. A. Hollenbeck. Duchesne; Mrs. L. B. McCornlck. Salt I>ake City; R. L. Olson. Ogden; Mrs. S. Grover Rich. Salt Lake City; Franklin Rlter. Salt Lake City; Sam D. Thurman, Salt Lake City. "And " Whereas said certificate of election has been filed In the Department of State of the State of Utah; and " Whereas, pursuant to section 8 of said statute, designated as chapter 22. Laws of the State of Utah, passed at the twentieth session of the legislature. 1933. the said convention has met at the time and place fixed by said statute, to wit, at 12 o'clock noon, December 5. 1933. and has organized by the election of a presi- dent, vice president, secretary, and other officers, and has adopted rules governing its deliberations and is ready to proceed to con- sider the proposed article of amendment; and " Whereas Mrs S. Grover Rich, of Salt Lake City, the regularly elected and qualified delegate to this convention, was and Is absent from the State of Utah and is not present at the sessions of said convention, and piu-suant to the authority vested In said con- vention by section 7. chapter 22. Laws of Utah. 1933 (regular ses- sion). Mrs. Paul Keyser. of Salt Lake City, has been elected and designated a delegate to said convention to fill the vacancy created by the absence of Mrs. S. Grover Rich: Now. therefore, be It " Resolved. That this convention of the delegates representing the people of the State of Utah, duly assembled pursuant to law. that we do approve and ratify the proposed article of amendment to tSe Constitution of the United States of America proposed by the Congress thereof and designed to repeal the eighteenth article of amendment to said Constitution, which proposed article of amendment reads as follows: " ' Whereas the Senate and House of Representatives of the United States of America in Congress assembled (two thirds of each House concvirring therein), each resolved that the following article Is hereby proposed as an amendment to the Constitution of the United States, which shall be valid to all Intents and pur- poses as part of the Constitution when ratified by conventions In three fourths of the several States; "'Section 1. The eighteenth article of amendment to the Con- stitution of the United States Is hereby repealed. " ' Sec. 2. The transportation or Importation into any State. Ter- ritory, or possession of the United States for delivery or use therein of Intoxicating liquors. In violation of the laws thereof. Is hereby prohibited. "'Sec 3. This article shall be Inoperative unless It shall have been ratified as an amendment to the Constitution by conventions In the several States, as provided in the Constitution, within 7 years from the date of the submission hereof to the States by the Congress * "Be It further " Resolved. That the action of this convention In approving and ratifying the said proposed amendment Is valid to all Intents and purposes as representing the people of the State of Utah, and be it further " Resolved, That the president and secretary of this convention shall certify the result of the votes of the delegates to the ratifica- tion of said amendment In triplicate, each signed by the president and secretary of the convention to which there shall be attached a certificate certified by such officers of the record of the vote taken, showing the yeas and nays thereon, and that such certificates and certified copies of such record shall be deposited with the secretary of state of the State of Utah, and he shall transmit one such certificate and certified copy of such record to the Secretary of State of the United States, another certificate and certified copy of such record to the Presiding Officer of the Senate of the United States, and another certificate and certified copy of such record to the Speaker of the House of Representatives of the United States, which said certificates shall be accompanied by the certificate of the secretary of state certifying that the persons signing the certificates so transmitted were the duly constituted president and secretary of said convention, and that their signa- tures are genuine, and that before transmitting the certificates and copies of records so deposited with the secretary of state he shall make a copy of one of them, certifying It as such and record It as a permanent record of the secretary of state of the State of Utah; and be It further " Resolved. That the president, secretary, and any other officer of this convention and the delegates and secretary of state or any or either of them are hereby authorized to comply with any act or resolution of the Congress of the United States requiring other or further confirmation of such ratification or rejection of said proposed amendment; and "Resolved further. That In the event of the death, disability, or absence of the president of this convention from the State of Utah, the vice president of this convention be, and he Is hereby authorized to execute all Instruments and documents Intended or required to be executed by said president; and " Resolved further. That In the event of the death, disability, or abaence from the State of Utah of the secretary of this conven- tion, that the signature of the chairman of the committee on resolutions of this convention to said certificates and documents shall to all intents and purposes be of the same legal effect as the signature of said secretary." FiuNXLXN Rim. Chairman. Clamncz Bambxboeb. Oeobci 8. Ballit. l. B. Hamptow. A. 8. Bbown. l. a. Hollinmck. LAwmsNct Clattom. llxs. Paul Kbti A. O. Clus, Jm. 48 CONGRESSIONAL RECORD— SENATE January 4 1934 CONGRESSIONAL RECORD— SENATE 47 state convention of delegates held In the hall of the houae of representatives at the capttol In the city of Salt Lake In the State of Utah, on Tuesday, December 5, 1933, at the hour of 12 m., to consider and act upon the ratification of the proposed amend- ment to the Ck>nstltution of the United States of America pro- viding for the repeal of the eighteenth amendment to the C!on- •tltutton of the United States. In acc. 1983. [SEAL] Jambs H. Kbbbt. Secretary of Stute. House Memorial No. 3, on the eariy settlers who were deprived of their hoones by the oonflrmation of '*p*"s have copies of this memorial sent to the President of the United States, the President of the United States Senate, the Speaker \t the House of Representatives, and the United States Senate:^, and Members of the House of Representatives from West Vlrgiui&. We, Charles Lively, clerk of the Senate of West Virginia, acd John S. Hall, clerk of the House of Delegates of West Virgin! i. hereby certify that the foregoing resolution was regularly adopt4d by the Legislature of West Virginia on December 19, 1933. CHASUKS LiVKLT, Clerk of the Senate. Jno. S. Haix. Clerfc of the House of Delegates. The VICE PRESIDENT also laid before the Senate the following concurrent resolution of the Legislature of tte State of Kansas, which was referred to the Committee oa Agriculture and Forestry: A concxirrent resolution memorializing the Congress of the United States to pass the Prazler bill and place American agrlcultuie OB a basis of equality with other Industries Whereas Kansas la largely an agricultural State and largely dependent on that Industry; and Whereas prices of agricultural products, both crops and llv<- stock, are now. and have long been, so low that the farmers aie vinable to pay taxes. Interest, and upkeep, and to secure a living retxim for their capital and labor; and Whereas Interest rates on farm-mortgage indebtedness from both private and public funds have not decreased in proportion to the decreases in prices of agriculttu^ products; and Whereas there has been introduced in the Congress of ttae United States a blU known as the " Prazler bill " which provld< s that the Federal Government, with Treasury notes, shall reflnanc e farm mortgages at an interest rate of 1 Va percent and an amortlza - tlon rate of 1«4 percent, making a total of 3 percent, the Treasury notes being retired as the mortgage debt Is paid; and Whereas such legislation Is necessary in order to rehabllitalje American agriculture: Therefore be It Resolved by the senate (the house of representatives concurrinj therein). That the Congress of the United States is urged to enafflil«turf of tlio §i»u m WiMoiMin. which wff« t^tm^A to tho Commlttoi on A«ri. oulturt tnd Poroftry; •f AVI or WtMOffMN ietnt fMolutkHi ffrtolinff t« r»o«ral mMom to prvvMil mmmnUi MUf IM Mi4 proAU m th« mMtufMturs mi OtHrlkution of tetii pfMMSM WhoTMA ttM prwMint milk strttM is in Urg* p«rl diM to MlUttoii potd br >«rf« dairr oompARlM; Slid ^ "••^••i WlMTMi tlMTf t« rssMMi U) belisvs that Xtm* Is um» basis for IMS* oempUiDU And that noma uf the dairy eompanlM havt MTMd esiiMMvf proflu tvea durinc lh« ptrtod al aeuto doprtMloi \ r&MMl th« bouM Iforsmbw f, \m. and that salaries have been paid to high ofBclals which are la excess of any reasonable figure; and Whereas only the Federal Government can deal with the prob- lem presented by these large profits and excessive salaries in the manufacture and distribution of dairy products; Therefore be It Resolved by the assembly (the senate roncurring). That the Legislature of Wisconsin respectfully memorializes the Secretary of Agriculture of the United States in administering the National Farm Relief Act to take Into consideration the profits made and the salaries paid by the large dairy companies and in all measures which he may take under this act to bring farm prices up to higher levels he allow only a reasonable return and permit only reasonable salaries in the manufacture and distribution of dairy products; be It further Resolved, That this legislature memorializes the Congress of the United States to take such other action as may be necessary to prevent unreasonable profits and salaries in the dairy industrj' and to secure for the farmers the higher {trices for dairy products, which will be rendered possible if excessive profits and unreason- able salaries to manufacturers and distributors are eliminated; be it further Resolved, That properly attested copies of this resolution be sent to Hon. Henry A. Wallace, Secretary of Agriculture, to both Houses of the Congress of the United States, and to each Wis- consin member thereof. Thomas J. CMallkt, President of the Senate. R. A. Cobban, Chief Clerk of the Senate. C. T. Young, Speaker of the Assembly. John J. Slocum. Chief Clerk of the Assembly. Statx or Wisconsin. Joint resolution relating to standards for Imported dairy products Whereas the appalling distressful economic condition of dairy farmers, especially the dairymen of Wisconsin, is now a matter of national concern; and Whereas more than 70 percent of the cheese produced in the United States Is produced In the State of Wisconsin; and Whereas such cheese and other milk products are produced In conformity with the highest standards of sanitation known any- where in the world and are produced from milk derived from tuberculin-tested cows, the State of Wisconsin being accredited free from bovine tuberculosis by the Department of Agriculture; and Whereas large sums have been expended by the Federal and State Governments and the dairymen of this State In the eradi- cation of tuberculosis and other contagious diseases in cattle and the adoption and enforcement of bam scores and other sanitary standards of production; and Whereas approximately 15 percent of the cheese consumed in the United States, representing nearly 1,000,000,000 pounds of surplus milk, is annually imported from foreign countries where no tuberculin tests of cattle or other sanitary standards are Im- posed or enforced, and such cheese is made from milk from cattle In herds that are 48^ percent tubercular and is processed in human dwellings in contact with virulent cases of Infantile paralysis and other contagloiis diseases; and Whereas a bill to place all Imports of cheese, butter, and all milk food products under the same sanitary regulations as are Im- posed upon the same milk products produced in Wisconsin has been Introduced in the House of Representatives by Dr. Chamjcs W. HiNNXT, representing the second district of Wisconsin, as bill H.R. 3829, and a twin bill, 8. 1628. has since been Introduced in the Senate by Senator Cappcs, of Kansas: Therefore be It ile«o/ped by the assembly, the senate concurring. That the Legislature of Wisconsin hereby respectfully memorializes the Con- gress of tlM Unlt«d SUtes to immediately pass bill H.R. 3830, and further respectfully mcmorlaliiies that President Roos«vtlt and the Secretary of Agrlculturfl to include tb« enaotmcnt of this l«gl*- lature in tb«lr farm prograin as a material and posttlve »Up in allcYlatlng tb« prMwnt d«prtsMd condition of the dairy Inductryi bf It furih«r Htiolvtd, That properly att««Ud ooptM of thlf rMoltttton bo tratMtnittod to PrMldtnt llooMttH, to th« Nonorablo ffofiry A. WallaM, ••orfiary of Aoriotiltiir*, to Hon Mamvin Jonm, Otialrmaii of th« OofnmlttM on Aorloiilturs tH ih# Moys* of flMfOMntoiivos, to ih« frMldlflf OAiWfs ttf n««fh M<»u»# m th« Coiitrm ol iho Vnitod IKatM, ftttd to nurtt Momhor of Oottorsss from (his fioio, O. M. Ui*mw, Pr»»Ul0nt uf iH» t§fHit», Ohmt oitfH of thi tMuti, 0 T Vovoo, tp»»k§f of th» AtMtmblif, JONN J BUWVH, Ohitf Oltrk of tht 4t$»mblv, Tho VICI FRItmElfT ftUo Uld boforo iho Sontto tho following Joint roiolutlon of tho logUUturo of tho SUto tff Wtuconain, whloh wm referred to tho Commlttoo on Commorco; ^^..-vKT/-^T»T:^nr»T/-kVT A T ■r»Tr«/~i/^T>T\ O IT" XT A HP "C^ Taxtttaov a 1934 CONGRESSIONAL RECORD— SENATE 49 State or WiscoNsnf. Joint resolution against the removal of Lock and Dam No. 10, upper Mississippi River Improvement project, from CassvUle, Wis. Whereas Cassvllle was selected as the logical site for Lock and Dam No. 10, by Government engineers after 3 years' careful and Impartial survey; and Whereas Guttenberg, Iowa, citizens filed a protest to such loca- tion and the Rock Island office Issued an announcement on Octo- ber 5, 1933, that said site has been changed to Guttenberg, Iowa; and Whereas port rights for Glen Haven, Wis., were surrendered and the State's rights forfeited when the channel was permitted to b« moved to the Iowa side some 40 years ago; and Whereas It has been a constant and heavy expense to the Gov- ernment each year since to keep such channel open to navigation by the use of dredges, proving conclusively that the natural channel was rightfully on the Wisconsin side; and Whereas If said dam is permitted to remain at Cassvllle this expense would be eliminated, and, in all likelihood, port rights restored to Glen Haven, with better navigation through higher water level Insured to Guttenberg becaxise of the necessity of conserving flood waters here to maintain a 9-foot channel; and Whereas the serious relief problem which now confronts Cass- vllle and Grant County would practically be solved by furnishing work for several years to hundreds now \inemployed: Now, there- fore, be it Resolved by the senate (the assembly concurring), That this legislature registers Its most emphatic protest against the re- moval of Lock and Dam No. 10 from Cassvllle — the site originally selected by experienced Government engineers after a careful survey; and be it further Resolved, That suitable copies of this resolution be sent to Gov. Albert G. Schmedeman, Harold L. Ickes, Public Works Ad- ministrator. Washington, D.C., to both houses of the Congress of the United States and to each Wisconsin Member thereof. C. T. Young, Speaker of the Assembly. John J. Slocum, Chief Clerk of the Assembly. Thomas J. O'MALLrr, President of the Senate. R. A. Cobban, Chief Clerk of the Senate. The VICE PRESroENT also laid before the Senate the following joint resolution of the Legislature of the State of Wisconsin, which was referred to the Committee on Finance: State or Wisconsin. Joint resolution relating to pensions for Spanish -American War veterans and the disabled veterans of the World War Whereas the National Economy Act (Public Law No. 2, 73d Cong., 1st sess.) cut off from all allowances by the Federal Gov- ernment all disabled veterans of the Spanish-American War, the Boxer rebellion, the Philippine Insurrection, and the World War who cannot establish that their disabilities resulted from war service; and Whereas this Is particularly unjust in the case of the veterans of the Spanish -American War, the Boxer rebellion, and the Philip- pine Insurrection because no adequate hospital records were kept during these wars, so that it Is practically impossible for veterans of these Wars, althoiigh disabled In service, to establish this fact; and Whereas under this act many hundreds of thousands of dU^ Abled veterans will on July 1 be cut off from the Federal pension rolls and thereafter receive no aUowances whatsoever from the Federal Oovemment; and Where** many of these veterans are incapacitated to mch an extent that they cannot poselbly get along without help from •oflM souroe; and WhereM this act at tli« Federal Government will Incrtas* iin* mensely the relief burden of the eounif and looal government*; Th*refore, b* It M»»otP§d bji tht atitmhly (thti §»nai« eonflurrinf) .TYMi th« iA§» tolAturt ot wieootMrtn rMpeetfuIlf m«mori«liiMHi the Oonffett of th« VniUA MtAtM t« rMetMi4«r lie •vUtm on the •limlnatloti trom ilf ftdtril ptuHon rolU of diMtii«d ^turnnti ttt ih« MiNintAh' hmtUfn W«r. th« %o%f rehetlkm, th« fh\\\tip\n9 tiMUffeeitott/ •iMl th# WcrfUl W»f, aiMl that it «m«fl4 this iMMlftilAtt m> thti tftMi(»i«d vtttratM wilt rM«ilv* «itow»n«M mm»iiu»m to tb«lr mV' pofii (M It (urth«f H»nnUn and bar- barous treatment accorded Negro prisoners in southern prison camps and the shocking lynching of Negroes which have at various times been perpetrated in some of the southern States; and Whereas it is the sense of the people and the legislature of this State that such inhuman treatment has a marked and definite tendency to destroy respect of our people for law and order; and Whereas the treatment accorded the Negro prisoners in soma southern prison camps, commonly referred to as "chain gangs'*. Is horrifying, and the pain and suffering to which these Negro prisoners are subjected is excruciating; and Whereas the dispensation of Justice to and punishment of Negroes suspected of crime is not a matter to be dealt with by a group of aroused and angry citizens having no real consideration for constitutional rights and no re8p>ect for the adopted and deliberative rules of evidence and procedure: Now, therefore, be it Resolved by the assembly (the senate concurring), That the Legislature of the State of Wisconsin earnestly requests and peti- tions the Congress of the United States to enact legislation which will effectively end the lynching or other destructlo.i of Negroes accused or suspected of crime In any other way or by any other authority than the due process of law. and by a duly constituted code of Justice, and to put a stop to the un-Christlanlike treatment of Negro prisoners by law-enforcing ofDcers In some prison camD*: and be it further Resolved. That a copy of this resolution, properly attested, be forwarded to the President of the United SUtes, the presiding officers of both Houses of Congress, and to the Wisconsin Senators and Representatives therein. Thomas J. CMaixct, President of the Senate. R. A. Cobban, Chief Clerk of the Senate, ■C. 'T. TOXTNO, Speaker of the Assembly. John J. Slocitsc, Chief Clerk of the Assembly. The VICE PRESIDENT also laid before the Senate the following joint resolutions of the Legislature of the State of Wisconsin, which were ordered to lie on the table: Statk or WiacoNsiif. Joint resolution memorialising Congress to promptly ratify tho pending Great Lakes-8t. Lawrence Seaway Treaty Whereas the State of Wisconsin is, and has been since its organi- zation, a member of the Great Lakes-St. Lawrence Tidewater Association, an association of States for the promotion of a treaty with Canada which would provide for the construction of an ocean-way from ports on the Great Lakes to the sea, and suc- cessive legislatures of Wisconsin have at each session made appro- priations for canning on the promotional work of said association for said purpose, and Whereas on the 18th day of July 1932, there was executed by the Governments of the United States and Canada a seaway treaty, fair and equitable to both Nations, providing for the con- struction of such ocean-way and equal division of the costs, which treaty is now on the Xxecutlve Calendar of the United States Senate for ratification by that body when it convenes January next: Now, therefore, be it RttotiMd by th« MfM<« {tK4 MMfnblv oonfiurriny). That we fwpMtfully metnorialiM and ttree the Uait«d States fenate to promptly ratify In lis prcstnt form the peiMllnf Ortat Lakes- st. Lawiwnee ieaway Treaty ee a real, natural. Baele. and per* fflan«nt form of affletilturel and indtietfiel relief for the Mid WeHi and be it Ittrther M§»otPi4, Thai ehffeeeed and proporif ettested eovlee ef ihle reeeltttlen bt eent te the rreeideht of the Vnlted Melee, lo Mie PfmMoM 0t the Metiale ef the Vmiei tlales. and w eeeti MemWr thefeef frea the flele of Wleeoiulii wHh the urfeiil remieel I ihev Men Iheif uimoei effort in iee«rini Mieli hmmiM9% In Mm earfr iaye of the apf»foi«hln# eeielon, fP^^ e/M|e AtHmbty, OhUt Otsrk oilmfji§t$mWy. Pr§§ti0nl of ih§ Jl§n§t§, R' A, OoeoAir, OM§f Olork of th§ i§n4tt, •tati ow fftooommm, Joint rssolutlen eRprMwinf eonlldenee in the program whleh Frssldent RocMeirelt hM pr— entod lor ending the dspreselon Wbsreas Frssident Koosersit In tha short tlm* that ha ha* bssn PrMldant ha* preeeatad to Congress a most eomprsbenslvs pro- 1^ 50 CONGRESSIONAL RECORD— SENATE gram for ending the depresBlon, which Includes among oth((r measures the following: Agricultural relief through the adopticn of a deflnite plan of Increasing the prices of the principal farn products and through making available above $2,000,000,000 fi>r refinancing the farmers; unemployment relief through provldlig millions of jobs for the unemployed under a gigantic |3,300.00C.- 000 puWtc-works program: through encouraging private indiistri « to reduce hours of labor and more equitably distribute avatlata ^e employment: a $500,000,000 reforestation flood-control progra n designed particularly to give employment to young men. and tlie outright grant of $500,000,000 to the States for direct relief; tl « reduction of normal Federal expenditures by nearly $1,000,000,00); the legalization of beer, and the recommendation to the Statis that they promptly ratify the pending amendment repealing tl le eighteenth amendment: the Inltiatkin of measures to promo « international understanding, to remove burdensome restrlctloi ut on international trade, and to secure an agreement on the pa-t of all nations on the necessary economic measures to overcome the depression: the refinancing of home- mortgage Indebtedneis through a $3,000,000,000 bond issue; strict regulation of securitli m sales and issues: the development of the long -delayed Muse e Shoals project; the strengthening of the banldng system; tl « request to American employers to increase wages; axMl lastly, but Dot least important, the abandonment of the gold standard, aid effective measures to raise the general price level and to lighten the burden of debts: and Whereas while only a part of this program, has thus far be€s of the State of Minnesota concurring) , That the State of Minnesota memorialize the Senate of the United States shortly to be in session, and by the adc^tion of this joint reso- lution the State of Minnesota does memorialize the Senate of the United States, to ratify at the approaching session of the Congress of the United States the treaty between the United States of America and the Dominion of Canada providing for the building, in accordance with the terms of said treaty, of a deep-waterway channel connecting the Great Lakes with tidewater; and be It further Resolved. That the Governor of this State Is hereby requested to forthwith transmit to the Senate of the United States a prop«ly authenticated copy of this joint resolution of the House of Rep- resentatives and the Senate of the State of Minnesota. K. K. SOLBBBO, President of the Senate. Chas. Munn, Speaker of the House of Representatives. Passed the senate the 22d day of December 1933. G. H. Spaxth, Secretary of the Senate. Passed the house of representatives the 26th day of December 1933. Harst L. Allsn, Chief Clerk, House of Representatives. Approved December 27, 1933. Flotd B. 0£jk>n, Governor of the State of Minnesota. Filed December 28, 1933. Mikk Holm, Secretary of State. The VICE PRESIDEa^T also laid before the Senate the following concurrent resolution of the Legislature of the State of Michigan, which was ordered to lie on the table: A concurrent resolution urging the United States Senate to ap- prove the proposed treaty agreed upon between the United States and Canada for the Improvement of the St. Lawrence River, so that ocean-going vessels from the Atlantic seaboard may reach the Great Lakes and the Port of Detroit Whereas the consummation of the Great Lakes-St. Lawrence Treaty ends the age-long struggle of land-locked people to gain access to the sea; and Whereas the joint undertaking for extending ocean carriage to the heart of the American continent is a major world accomplish- ment and sets a new mark in International cooperation; and Whereas it now appears that there exists a real and Imperative need for this waterway outlet which will greatly enhance the economic well-being of the people of the State of Michigan: Therefore be It Resolved by the senate {the house of representatives eoncurrirui) , That this first extra session of the 1933 Legislature of the State of Michigan request the Senate of the United States to delay no longer In bringing the matter of ratlflcatlon of the St. Lawrence Waterway Treaty before that body for final consideration. Adopted by senate November 27, 1033. Adopted by house of representatives December 6, 1933. Alucn B. Stkbbihb, President of Senate. Don W. CAimxu), Secretary of Senate. MABTTJr R. Bbaolst, Speaker of House of Representatives. Mtum F. Okat, Clerk of House of Representative*. The VICE PRESIDENT also laid before the Senate the following resolutions of the Legislature of the State of Maine, which were referred to the Committee on Public Lands and Surveys: State or MAzm. 1933. Memorial to the President of the United States and the honorable Senate and House of Representatives of the United States of America, in Congress assembled, recommending that the Federal Government establish an official gateway to Acadia National Park We, the Senate and House of Representatives of the State of Maine, In legislature assembled, most re8p>ectfully present and petition the President of the United States and the honorable Senate and House of Representatives, as follows: Whereas Acauiia National Park, with Its scenic Mount Cadlllao Drive and various other distinctive featiires, combining the beauties oi the seacoast and mountain. Is one of the country's outstanding parks: and CONGRESSIONAL RECORD— SENATE 52 Whereaa many rttlz^-na. through lack of Information, do not realize the many scenic wonders that may be enjoyed: and Whereaa a bill wUl be Introduced In the next CJon^^eas of the United States for the pxirchaae of some «6 acres of land at Mount Desert Bridge, the point of entry on to Mount Desert Island, for the purpose of creating thereon an offlcial entrance and gateway | to Acadia National Park, together with an Information house, an airport and a landscape engineering department for the purpose , of planning and maintaining landscape projects within the na- i ttosal park area and also highway beautlflcatlon projects already ectabllshed by the National Conservation Board: and Whereas the Eighty-sixth Legislature of the State of Maine, believing that the proposed gateway to the Acadia National Park will result In giving more pleasure to the citizens who use It and greatly Increase the facilities of the park: Now, therefore, be It ReM>lved bv tKe Seriate and House of Representatives of the State of Maine in Legislature assembled. That we urge the Presi- dent of the United States and the Congress of the United States to do all In their power to further and assist In the creation of the gateway to Acadia National Park; and be It fiirther Resolved. That copies of this memorial be dxily certified and •ent by the secretary of state to the President of the United States and to the President of the Senate and to the Speaker of the House of Bepresentatlves at Washington and to each of the Sen- ators and RepreaentaUvea from the State of Maine In the Congress of the United SUtes. In Se«AT« CHAMBn. December 16, 1933. Bead and adopted. Sent down for conciirrence. RoTDCW V. Beown, Secretary. Hovss or REniiSKNTATi\is. December 16, 1933. Read and adopted. In concurrence. Hakvct R. Pease. Clerk. State or Maine. Omcs or Secsetaet or State. I. Robinson C. Tobey. secretary of state of the State of Maine. ^nri custodian of the seal of said State, do hereby certify: Tliat I have carefully compared the annexed copy of the memo- rial to the President of the United States and the honorable Senate and House of Representatives of the United States of America. In Congress assembled, of the Senate and House of Rep- sesentatlves of the State of Maine In legislature assembled, with the original thereof, and that It U a full. true, and complete tc^nscrlpt therefrom and of the whole thereof. In testimony whereof I have caused the seal of the State to be hereunto affixed. Given under my hand at Augusta, this 16th day of December. A. D. 1933. and In the one hundred and fifty- eighth year of the Independence of the United States of America. [sbai.] Robinson C. Tobet, Secretary of State. The VICE PRESIDENT also laid before the Senate the foUowins joint resolution of the Legislature of the State of Maryland, which was referred to the Committee on Inter- state Commerce: The State or Maetuind, EXXCXTTTVE DePAKTMENT. I. DsTld O. Wlnebrenner. 3d. secretary of state of the State at Maryland, under and by virtue of the authority vested In me by section 50 of article 35 of the Annotated Code of Maryland. do hereby certify that the attached is a true and correct copy of Joint Basoiatton No. 1, of the the acts of the extra session of the General AmexntAj of Maryland, which convened on the 23d day at November 1933. as the same is taken from and compared with the <»lglnal Joint resolution. In testimony whereof I have hereunto set my hand and have caused to be affixed the offlcial seal of the secretary of state, at AnnapoUa, Md., this 15th day of December in the year one thousand nine hundred and thirty-three. (isai.] Davd C. Winebbenneb. 3d. Secretary of State. House Joint resolution expressing to the Fedeial Coordinator of Tran^tortatltm and the Interstate Commerce Commission a protest agalast the so-called " Prince plan " for uniting the Baltimore * ak., favoring the regulation of trucks and busses engaged in interstate transportation, which was referred to the Com- mittee on Interstate Commerce. He also laid before the Senate a resolution adopted by members of the Holy Name Society assembled at S^^inaw, Mich., favoring Federal supervision and regulation of the motion-picture industry, which was referred to the Com- mittee on Interstate Commerce. He also laid before the Senate a petition of the Presby- terian General Assembly of 1933, at Columbus, Ohio, praying for Federal supervision and regulation of the motion -picture industry, which was referred to the Committee on Interstate Commerce. He also laid before the Senate a resolution adopted by the Second Polish Workers Convention at Chicago, 111., pro- testing against the mistreatment of women and girls in land »jul has been extended and developed Into a great national Senator from the State of Louisiana, on account of certain CONGRESSIONAL UECORD-^ENATE 54 factories, which was referred to the Committee on the ^^Judlciary. He also laid before the Senate the memorial of Harold G. Rossell. of Chicago. HI., remonstrating against the conflrma- tjon of Philip L. Sullivan as judge of the District Court for the Northern District of Illinois, which was referred to the Committee ete In any other country with foreign match manufacturers; and Whereas the American match industry has never had real tariff protection; and Whereas this Industry has been continually haras.sed by unfair importations of misbranded. mlsmarked, and inferior quality dumped matches; and Whereas, foreign match manufacturers have been guilty of un- scrupulous practices by coloring the splints and so reducing the duty paid to one third or less of the amount Intended by Cor\gress: and Whereas during the past 3 years the Government has seen fit to prevent dumping of matches by nine European countries and Japanese importations have Increased from 8,829 gross In June 1932_ to 399,700 gross In September 1933. an Increase at 4.532 percent; and Whereas women in the Cloquet match factory under the N.R-A. are paid 30 cents per hour while women in Japanese match factories are paid 3 cents per hour; and Whereas under present conditions, working under the match code, paying the high wages that the American Industry does, competing with the low-cost matches from Japan asxd other countries. It is Impossible for American manufacturers to com- pete and continue running unless something can be done In the near future; and Whereas in the city of Cloquet, as a result of this unfair com- petition, 250 people have lost their employment, and the factory may suspend work permanently until the United States Govern- ment gives added protection against these foreign Importations: and Wliereaa If this suspension of operation takes place, the farmers of northern Minnesota and Wisconsin will lose from 955.000 to 984.000. annually, which Is now pjald to them: Therefore be It Resolved, That the House of Representatives of the State of Minnesota, the senate concurring herein, that we hereby respec- tively petition and urge Congress to pass appropriate legislation to protect this American Indvistry and its employees by prevent- ing the dumping of these luifalr products, and. be it further Jtesotoed, That the chief clerk be Instrxicted to forward a copy hereof to each of the Senators and Representatives oX the State 1934 CONGRESSIONAL RECORD— SENATE 55 of Minnesota In Congress of the United States, and a copy each to the President of the United States, the President of the Senate, and the Speaker of the House, at Washington. Chas. Mtjnn, Speaker of the House of Representatives. K. K. SOLBERO, President of the Senate. Passed the house of representatives the 15th day of December 1033. Harkt L. Allen, Chief Clerk House of Representatives. Passed the senate the 18th day of December 1933. G. H. Spaeth, Secretary of the Senate. Approved December 21, 1933. Floyd B. Olson, Governor of the State of Minnesota. Filed December 22, 1933. Mike Holm. Secretary of State of Minnesota. Mr. BULKLEY presented the following joint resolution of the Legislature of the State of Ohio, which was referred to the Committee on the Judiciary: Joint resolution memorializing the Congress of the United States relative to the excise tax on spirituous liquors Whereas the Governor of Ohio has suggested In his message to the general assembly that the ninetieth general assembly in second special session assembled, memorialize Congress of the subject of taxation of liquors, urging and requesting them that taxes on spirituous liquors be not made so high as to make possible the continuation of existing bootlegging traffic: There- fore be It Resolved, That the Ninetieth General Assembly of the State of Ohio request that the Congress of the United States shall au- thorize the Immediate consideration of such regulatory measures as It may deem necessary to prohibit illicit trafficking in spirit- uous liquors; and be It further Resnlied, That we urge the President of the United States and each of the Ohio Senators and Congressmen to lend their aid and ' support to enactment of such legislation at the earliest possible time; and be It further Re-tolved, That copies of this Joint resolution be transmitted to the President of the United States, to both the United States Senators and each Member of Congress from Ohio, and to the chairman of the House and Senate committees of the Congress of the United States which have the proposed legislation under consideration. Frank Cave. Speaker of the House of Representatives. Charles Sawyer, President of the Senate. Adopted December 12, 1933. Mr. VANDENBERG presented the following resolution of the Senate of the State of Michigan, which was referred to the Committee on the Judiciary: A resolution memorializing the Senate of the United States to enact the Sumnera bUl HJR. 5950, or other similar legislation to provide for the temporary relief of Insolvent municipalities and to preserve the taxable value of their property Whereas the present financial crisis in the United States has made it impossible for cities and other governmental units in Michigan to collect enough money to maintain essential govern- mental services, such as fire, police, and health departments and at the same time pay Interest and principal on maturing debts; and Whereas many local governmental units In Michigan are threat- ened with a multiplicity of lawsuits which will further add to the tax burden and otherwise further handicap said local govern- ments, and threaten to totally destroy local government and to endanger the lives and property of the citizens of the State of Michigan: Therefore be It Resolved, That the State of Michigan, through Its senate here assembled approves In prlnlcple the Sumners bill HJl. 5950, now pending, entitled " Provisions for the emergency temporary aid of Insolvent public debtors and to preserve the assets thereof, and for other related purposes." It being understood that said bill provides in general that cities and other local units may file a petition in the Federal district court stating that the taxing dis- trict is Insolvent or unable to meet its debts as they mature, and that it desires to effect a plan of readjustment of its debts upon the basis of its capacity to pay. When such plan of debt read- justment has been approved by two thirds of the creditors , affected the Federal court shall have~ authority to decree the plan so approved binding on all creditors, whether they have accepted or not; and be it further Resolved. That a copy of this resolution be transmitted to both Michigan Members of the United States Senate. Adopted by the Senate December 19, 1933. Allen E. Stebbtns, President of the Senate. Don W. Canfield, Secretary of the Senate. Mr. VANDENBERG also presented resolutions adopted at a mass meeting of Ukrainians held at the United States Light Guard Armory, Hamtramck, Mich., favoring an investiga- tion of the treatment accorded the people of the Soviet Ukraine, which were referred to the Committee on Foreign Relations. Mr. WALCOTT presented the following resolution adopted by the Senate of the Legislature of the State of Connecticut, which was referred to the Committee on Foreign Relations. Resolution requesting the Senate of the United States to approve the ratification of the three pending World Court treaties at the earliest practicable time Whereas many of the economic and financial problems now confronting the Nation and this State had their origin In the World War; and Whereas one of the best means of avoiding future world catastrophies Is to develop practicable methods for settling pacifi- cally the International disputes that are bound to arise In In- creasing numbers as the web of international commercial and other relations grows steadily more complex; and Whereas the World Court has proved Itself In the 11 years of its existence capable of settling difficult and potentially dangerous questions of a class for which the Judicial method \b suitable by applying principles of International law, and has Indeed suc- cessfully settled 45 such questions; and Whereas the Senate of the United States on January 27. 1926, by a vote of 76 to 17, approved our adherence to the World Court if five conditions were met; and Whereas these conditions are now fully met In the Judgment of the Department of State and of such competent bodies as the American Bar Association and the Connecticut State Bar Associa- tion by the three treaties which have already been signed by the United States and which now await the Senate's consent to ratification; and Whereas both the Democratic and Republican platforms of last June endorsed the completion of the adherence of the United States to the World Court: Therefore be it Reserved, That the Senate of the General Assembly of Connecti- cut respectfully requests the Senate of the United SUtes to ap- prove the ratification of the three pending World Court treaties at the earliest practicable time; and be It further Resolved, That the senior Senator from this State la hereby requested to ask that this resolution be spread upon the Com- gressional Reccad. He also presented a resolution adopted by the World Court Committee of New Britain, Conn., favoring the prompt ratification of the World Court protocols, which was re- ferred to the Committee on Foreign Relations. He also presented resolutions adopted by the Connecticut State Home Economics Association, at Storrs, and the Hart- ford Medical Society, of Hartford, both in the State of Con- necticut, favoring the enactment of legislation to strengthen the Pure Food and Drugs Act, which were referred to the Committee on Commerce. He also presented petitions of the disabled American vet- erans of the World War, and of sundry citizens, all of New Haven, Conn., praying a restoration of all benefits lost to service -connected veterans by the passage of the so-called " Economy Act ", which were referred to the Committee on Appropriations. He also presented memorials of sundry insurance company agencies and the Chamber of Commerce of Greenwich, all in the State of Connecticut, remonstrating against the de- basement of the currency and favoring a continuance of a sound currency policy, which were referred to the Committee on Banking and Currency. He also presented the memorial of the Yalesville Woman's Christian Temperance Union, of Yalesville, Conn., remon- strating against the sale of liquor in the District of Colum- bia and in the Territories, and also against the repeal of enforcement legislation, which was referred to the Com- mittee on the District of Coliunbia. He also presented the petition of the North End Feder- ated Clubs, of Hartford, Conn., praying for the passage of legislation to abolish lynching, which was referred to the Committee on the Judiciary. He also presented the petition of Thomas L. Reilly Branch, No. 60, National Association of Letter Carriers, of Stamford. Conn., praying for the restoration of salaries reduced by the so-called " Economy Act ", a guaranteed pay to substitute letter carriers each month, and a classification of all village CONGRESSIONAL 1 ECORD— SENATE 56 delivery offices as city delivery offices, which was referred to the Committee on Post Offices and Post Roads. Mr FESS presented a resolution adopted by the Com City Savings Association, of Toledo. Ohio, favoring loans by the Home Owners' Loan Corporation to home owners distressed by delinquent taxes and inadequate earning power and for the purpose of making necessary repairs and improvements to their properties, which was referred to the Committee on Banking and Currency. Mr. THOMPSON presented a petition of sundry citizens of the State of Nebraska praying for the repeal of the so- called '• Economy Act ' and the immediate cash payment of World War adjusted -service certificates, which was referred to the Committee on Finance. ■KLIZr OF XWEMPLOYMENT AND SOCIAL IKStniANCS Mr. DUFFY presented resolutions adopte-i by the common CouncU of the city of Milwaukee. Wis., which were referred to the Committee on Education and Labor and ordered to be printed in the Record, as follows: Resolved by the Common Council of the City of Mllw»ukee. that It endorses State and Federal legislation having for Its object the carrying of the bxirden of the support of those displaced In In- dustry by present economic changes by governmental agencies such as Oovemment unemployment and social Instirance: Resolved further. That the city clerk be and hereby Is directed to forward certl&ed copies of this resolution to Congreas. the county board of •upcrvlaors. and the Wisconsin Legislature. Omcc or th« Crrr Clssk. Miltoaukee, December 28. 1933. I hereby certify that the foregoing Is a copy of a resolution adopted by the Common CouncU of the City of Milwaukee, on X)ecember 3fl. 1»33. ^^^ ^^,. Pkawk a. Kjuwcxak, City Clerk. Bvwrrr of comvitioiis amomg ihjuahs of the uwrrKD statks (S.BKPT. NO. 147) Mr. WHEELER, from the Committee on Indian Affairs, submitted a partial report pursuant to Senate Resolution 7». Seventieth Congress, and subsequent resolutions, on the development and leasing of the Flathead power sites. Flat- head Ty^/^ian Reservation, Mont. BILLS Airo JOINT RESOHTnONS nfmODUOED Bills and Joint resolutions were introduced, read the first time, and, by unanimous consent, the second time, and referred as follows: By Mr. VANDENBERG: A bill (8. 1956) for the relief of the Acme Motor Truck Corporation; and A bill (8. 1957) for the relief of .\nna W. Denncrt; to the Committee on Claims. A bill (S. 1958) for the relief of Lewis Marion Hall; to the Committee on Naval Affairs. A bill (S. 1959) granting a pension to Dorothy Crosby Allen; A bill (S. 1960) granting a pension to Martha Adelaide Childs; and A bill (S. 1961) granting a pension to Mary Ann Fox; to the Committee on Pensions. By Mr. THOMPSON: A bill (S. 1962) for the relief of the First National Bank of Walthlll, Thurston County. State of Nebraska; and A bill (S. 1963) for the relief of Thomas J. Pryor; to the Committee on Claims. A bill (S. 1964) to amend section 801 of the Code of Law of the District of Columbia with respect to the punishment of the offense of murder in the first degree; to the Com- mittee on the Judiciary. A bill (S. 1965) for the relief of Charles Walker; to the Committee on Military Affairs. A bill (S. 1966) to investigate the claims of and to enroll certain persons, if entitled, with the Omaha Tribe of Indians; to the Committee on Indian Affairs. By Mr. BTRD: A bill (S. 1967) to include cattle as a basic agricultural commodity under the Agricultural Adjustment Act; to the Ccxnmittee on Agriculture and Forestry. January 4 By Mr. NEELY: _ _ A bill (S. 1968) for the relief of Jessie D. Bo\^'man; to the Committee on Claims. A bill (S. 1969) granting a pension to Fred L. Dreehouse; to the Committee on Pensions. By Mr. NORRIS: ^ ^, A bill (S. 1970) for the relief of Charles H. Craig: to the Committee on Military Affairs. A bill (S. 1971) granting a pension to Leo P. Thomas; to the Committee on Pensions. A bUl (S. 1972) for the relief of James W. Walters; to the Committee on Claims. A bill (S. 1973) to improve the navigability of the Missouri River; to provide for the flood control of the Mississippi River and the Missouri River: to provide for reforestation and the use of marginal lands in the Missouri Valley; to provide for the agricultural and industrial development of the Mississippi Valley and the Missouri Valley; to provide for the irrigation of lands in the Missouri Valley; to provide for the restoration and preservation of the water level in the Missouri Valley; to provide for the flood control of the Missouri River and the Mississippi River; to provide for the development of electrical power in the Missouri Valley; and for other purposes; to the Committee on Irrigation and Reclamation. By Mr. BANKHEAD: A bill (S. 1974) to place the cotton industry on a sound commercial basis and to prevent unfair competition and practices in putting cotton Into the channels of interstate and foreign commerce; to the Committee on Agriculture and Forestry. By Mr. SMITH: A bill (S. 1975) to provide for loans to farmers for crop production and harvesting during the year 1934, and for other purposes; to the Committee on Agriculture and Forestry. By Mr. GOLDSBOROUGH : A bill (S. 1976) to provide for preliminary examination and survey of the channel from Rhodes River to Cadle Creek. Anne Arundel County. Md.. with a view to providing a navigable channel across Cherry Stone Bar; to the Com- mittee on Commerce. By Mr. WHEELER: A bill (S. 1977) to provide funds for cooperation with the school board at Brockton, Mont., in the extension of the public-school building at that place to be available to Indian children of the Fort Peck Indian Reservation; to the Committee on Indian Affairs. By Mr. WALCOTT: A bill (S. 1979) for the relief of Austin L. Tiemey; to the Committee on Naval Affairs. By Mr. McNARY: A bill (S. 1982) to add certain lands to the Mount Hood National Forest in the State of Oregon; and A bill (S. 1983) to authorize the revision of the boundaries of the Fremont National Forest in the State of Oregon; to the Committee on Agriculture and Forestry. A bill (S. 1984) granting the consent of Congress to the Oregon- Washington Bridge Co. to maintain a bridge already constructed across Youngs Bay near the city of Astoria, Oreg.; A bill (S. 1985) relating to the amortization of the con- struction cost of certain toll bridges in the State of Oregon; A bill (S. 1986) authorizing a preliminary examination and survey of the Willamette River, with a view to the con- trolling of floods; and A bill (S. 1987) to develop American air transport services, to encourage the construction in the United States by American capital of American airships or other aircraft for use in foreign commerce, and to make certain provisions of the maritime law applicable to foreign commerce by airship or other aircraft; to the Committee on Commerce. A bill (S. 1988) for the relief of the Fischer Flouring Mills, of Silverton, Oreg.; to the Committee on Claims. 1934 CONGRESSIONAL RECORD— SENATE 57 A bill (S. 1989) to amend the National Industrial Re- covery Act with respect to the acquisition of public works projects; and A bill (S. 1990) for the relief of contract veterans of the Spanish-American War, including the Philippine Insurrec- tion and the Chinese Boxer Rebellion; to the Committee on Finance. By Mr. BULKLEY: (A bill (S. 1991) granting a pension to Laura F. Helm (with accompanying papers) ; to the Committee on Pensions. A bill (S. 1992) for the relief of Arthur R. Lewis; to the Committee on Military Affairs. A bill (S. 1993) for the relief of the Lower Salem Com- mercial Bank. Lower Salem, Ohio. A bill (S. 1994) for the relief of Estelle Johnson; and A bill (S. 1995) for the relief of John N. Brooks; to the Committee on Claims. By Mr. FESS: A bill (S. 1996) for the relief of Major Thomas J. Berry (with an accompanying paper) ; to the Committee on Claims. A bill (S. 1997) to compensate Harriet C. Holaday; to the Committee on Foreign Relations. By Mr. DICKINSON: A bill (S. 1998) for the relief of the estate of Martin Fljntm; to the Committee on Claims. A bill (S. 1999) to repeal title I of the National Indus- trial Recovery Act; to the Committee on Finance. By Mr. COPELAND: A bill (S. 2001) to provide for the establishment, opera- tion, and maintenance of foreign-trade zones in ix>rts of entry of the United States, to expedite and encourage for- eign commerce, and for other purposes; to the Committee on Commerce; A bill (S. 2002) for the relief of R. S. Howard Co., Inc.; A bill (S. 2003) for the relief of Henry A. Richmond; A bill (S. 2004) for the relief of Charles W. Smith; and A bill (S. 2005) for the relief of Harriet T. Bottomley; to the Committee on Claims. A bill (S. 2006) for the relief of Delia D. Ledendecker; to the Committee on the District of Columbia. A bill (S. 2007) to exempt from taxation certain property of the National Society of the Sons of the American Revo- lution; to the Committee on Finance. A bill (S. 2008) to amend the Criminal Code; to the Com- mittee on the Judiciary. A bill (S. 2009) granting a pension to Libbie T. Marrah; to the Committee on Pensions. By Mr. GEORGE: A bill (S. 2010) to provide for the establishment of a Coast Guard station on the coast of Georgia, at or near Sea Is- land Beach; to the Committee on Commerce. By Mr. McGILL: A bill (S. 2011) granting a pension to Josephine Morton; A bill (S. 2012) granting a pension to Wallace C. Harris; A bill (S. 2013) granting a pension to Bertram Brown; A bill (S. 2014) granting a pension to Mary Webb; and A bill (S. 2015) granting a pension to Lucy Copeland; to the Committee on Pensions. By Mr. CLARK: A bill (S. 2016) relating to the transmission through the mails of advertisements of intoxicating hquors; to the Com- mittee on Post Offices and Post Roads. By Mr. BORAH: A bill (S. 2017) to repeal a part of section 5 of the Na- tional Recovery Act; to the Committee on Finance. A bill (S. 2018) relative to Members of Congress acting as attomesrs in matters where the United States has an inter- est; to the Committee on the Judiciary. A bill (S. 2019) to establish the Boise National Mountain Park in the State of Idaho; to the Committee on Public Lands and Surveys. A bill (S. 2020) for the relief of Donald D. Rose and Wil- liam Fandry; to the Committee on Claims. A bill (S. 2021) granting a pension to Anna Blerd. widow of William H. Dunlop (with accompanying papers) ; to the Committee on Pensions. By Mr. SHIPSTEAD: A bill (S. 2022) for the relief of S. C. Bakken: A bill (S. 2023) for the relief of Miss Claudia L. Polaki; and A bill (S. 2024) for the relief of the heirs of John Booren, deceased; to the Committe on Claims. A bill (S. 2025) authorizing the appointment of Bernard C. Rose as a second lieutenant. Army Air Corps; to the Com- mittee on Military Affairs. A bill (S. 2026) providing for payment of $50 to each enrolled Chippewa Indian of Minnesota from the funds standing to their credit in the Treasury of the United States; to the Committee on Indian Affairs. A bill (S. 2027) granting a pension to Delia M. C. Ru- dolph (with accompanying paper); to the Committee on Pensions. By Mr. EZEAN: A bill (S. 2028) to provide an additional appropriation as the result of a reinvestigation, pursuant to the act of Feb- ruary 2, 1929 (45 Stat., pt. 2. p. 2047), for the payment of claims of persons who suffered property damage, death, or personal injury due to the explosions at the naval ammuni- tion depot. Lake Denmark. NJ., July 10, 1926; to the Com- mittee on Claims. A bill (S. 2029) to extend the time for completing the construction of a bridge across the Delaware River near Trenton, NJ.; to the Committee on Commerce. A bill (8. 2030) granting an increase of pension to Emma F. Meyer (with accompanying papers) ; to the Committee on Pensions. A bill (S. 2031) to assure to persons within the Jurisdiction of every State the equal protection of the laws, and to punish the crime of lynching; to the Committee on the Judiciary. By Mr. PATTERSON: A bill (8. 2032) making it an offense against the United States to kill an officer or employee of the United States in or on account of the execution of his duty; and A bill (S. 2033) to amend the act entitled "An act for- bidding the transportation of any person in interstate or foreign commerce, kidnaped, or otherwise unlawfully de- tained, and making such act a felony ", approved June 22, 1932; to the Committee on the Judiciary. A bill (S. 2034) granting a pension to Ella Woodward: A bill (S. 2035) granting a pension to Eliza Dutton (with accompanying papers) ; and A bill (S. 2036) granting an increase of pension to Martha J. Smith (with accompanying papers) ; to the Committee on Pensions. By Mr. CAPPER: A bill (S. 2037) to extend for 1 year the time during which loans may be made by the Reconstruction Finance Corpo- ration for financing the repair or reconstruction of buildings damaged by earthquake, fire, tornado, or cyclone; to the Committee on Banking and Currency. A biU (S. 2038) to repeal section 617 of the Revenue Act of 1932; to the Committee on Finance. By Mr. SHEPPARD: A bill (S. 2041) to amend the act of June 15, 1933, amend- ing the National Defense Act of June 3, 1916, as amended: A bill (S. 2042) to establish a department of phjrsics at the United States Bflilitary Academy, at West Point. N.Y.; A bill (S. 2043) to unend the act of May 22. 1928, entitled "An act to authorize the collection, in monthly installments, of indebtedness due the United States from enUsted men, and for other purposes "; and A bill (S. 2044) to amend the National Defense Act of June 3, 1916, as amended; to the Committee on Military Affairs. A bill (S. 2045) to authorize the settlement of individual claims of mihtary personnel for damages to and loos of private property incident to the training, practice, opera- \ CONGRESSIONAL RECORD— SENATE January 4 tion. or maintenance of the Army (with accompanying ■^SuO 2046) to provide relief for disbursing officers of the Army in certain cases (with accompanying papers) ; A biU iS. 2047) to authorize credit in dlsboralng ofHcers ftcamnts covering shipment of privately owned automobUes frSmOctober 12. 1927. to October 10. 1929 (with accompany- *^?iSm8 '2048) to authorize the settlement of tadivldui^ claims of miUtary personnel for damages to and U» of private property Incident to the training, practice, operation, or maintenance of the Army (with accompanying IW«"> • A bill (S. 2049) for the relief of the Western Electric Co., Inc. (With accompanying papers) : .. ^ . ,^ ^ A bill * 8. 2050) for the reUef of certain disbursing officer! of the Army of the United SUtes and for the settlemen of an individual claim approved by the War Department (with accompanying papers) ; J A bill (S. 2051) to authorize settlement. aUowance. and payment of certain claims (with accompanying papers) ; 1 A bill (S. 2052) to credit certain services as cadets at th* United States Military Academy (with accompanying papers) t A bill (S. 2053) for the relief of Capt. L. P. WorraH Finance Department. United States Army (with accompany ing papers) : _, ■ A bill (S. 2054) for the relief of certain disbursmg ofncer* of the Army of the United States and for the setUemenk of individual claims approved by the War Department (witJi accompanying papers) ; A bill (S. 2055) to autJ.orize the settlement, allowance and payment of certain claims, and for other purposes (witJi accompanying papers) : and A bill (S. 2056) to reimburse officers, enlisted men. an I civilian employees or the Army and their families and de- pendents, or their legal representatives, for losses sustainei as a result of the hurricane which occurred in Texas oi August 18. 17, and 18. 1915 (with accompanying papers) ; to the Committee on Claims. Bv Mr KINOt A bill (8. 2057) authorizing the sale of certain propert y no longer required for public purposes in the District er month for all persons who are more than 60 years of age and possess property less thiin $10,000 in value, or with a net income of less than $1,0)0 per year; wtiered to lie on the table. By Mr. CLARK: A Joint resolution (S.J.Res. 66) authorizing an appr) priatfon for the acquisition of a suitable site, and the coi- structlon of a permanent meriorial to the men who male possltale the territorial expansion of the United States, pa r- ticularly President Jefferson arid his aides, who negotiatMl the Louisiana Purchase, and the great explorers, Lewis and Clark and the hardy hunters, trappers, frontiersmen and pioneers and others who contributed to the territorial ex- pansion and development of the United States of America; to the Committee on the Library. By Mr. WALCOTT: _ ^ „ A Joint resolution oes the Senator from Texas yield to the Senator from Oregon? Mr. CONNALLY. I yield. Mr. McNARY. Is the Senator's bill in the form of an amendment to the 'Agricultural Adjustment Act? Mr. CONNALLY. It is designed to amend the act by in- cluding cattle. Mr. McNARY. Of course, it Is a question which will have to be considered. Has the Senator requested that it be referred to the Committee on Agriculture and Forestry? Mr. CONNALLY. I desire to have it go to that committee, if there be no objection. Mr. McNARY. That is the place where it should go. Mr. CONNALLY. I am not objecting to having it go there. Mr. MoNARY. What has the Senator requested be done with the bill? Mr. CONNALLY. The bill has not been referred as yet. Mr. McNARY. It should be referred to the Committee on Agriculture and Forestry. We debated that question at the time the original act was passed, and cattle were not included in its provisions because we wanted to do what it was thought was beneficial for the industry. Mr. CONNALLY. I am agreeable that the bill should be referred to the Committee on Agriculture and Forestry. The VICE PRESIDENT. The bill will be so referred. The bill (S. 1981) to make cattle a basic agricultural com- modity for the purposes of the Agricultural Adjustment Act, was read twice by its title and referred to the Committee on Agriculture and Forestry. KXGX7LATIOH OW TOOD AKV DRUGS Mr. COPELAND. Mr. President. I am introducing today a bill as a substitute for Senate bill 1944, known as the " food and drugs bill." The original bill which I presented met with violent opposition from every section of the coim- try, and the new bill is intended to be a substitute for the other, and I hope it will be reasonably satisfactory to all parties. Mr. NORRIS. Mr. President, I was not able to hear all the Senator said in connection, with the bill he is present- ing. Is this bill a substitute for the bill upon which a sub- committee of the Committee on Commerce has been hold- ing hearings? Mr. COPELAND. It is. Mr. NORRIS. I thought I heard the Senator say that he is introducing this new bill because there are objections to the other bill. Is that what the Senator said? Mr. COPELAND. The other bill the committee found to be really objectionable in certain particulars. After a study of the problems and the criticisms presented, a new bill was prepared and submitted to the subcommittee. It is now introduced, with the request that it be referred to the Com- merce Committee, in order that it may go to the subcom- mittee for further consideration. Mr. NORRIS. I would like to suggast to the Senntcv that he probably wiU not be able to introduce a bill on this sub- ject which will not meet with some objection Mr. COPELAND. I realize that. Mr. NORRIS. Unten the Senator introduces a bill which will not hurt anybody, and such a bill would do nobody any good. Mr. COPELAND. This new bUl will not be wholly satis- factory to the manufacturing interest* or to those who ar« brought under controL But from coniidersble experience in connection with this matter. I do feel that the bUl which I am now introducing is a better bill, and it Is so regarded by all thoee who have given it study. The consumer is fully protected. The bill (8. 2000) to prevent the manufacture, ihip- ment. and sale of adulterated or misbranded food, drink, drugs, and cosmettos, and to regulate traffic therein; to pre- vent the false advertisement of food, drink, drugs, and cos- metics, and for other purposes, was read twice by its title and referred to the Committee on Commerce. RKSTOaATIOlf or PAT OP OOVEUaKSlIT EXPLOTXIS Mr. ROBINSON of Indiana. Mr. President, I introduce a bill to restore the pay of Government emplosrees, which have been so unjustly slashed. The bill (S. 2039) to repeal certain provisions of law re- lating to economies in the National Government, to discon- tinue reductions in certain Government salaries, and for other purposes, was read twice by its title and referred to the Committee on Appropriations. RESTORATION OP VKTKRAirs' BJUKPITS Mr. ROBINSON of Indiana. I also introduce a biU to re- peal the so-called " Economy Act " in its entirety, and to restore to the veterans the benefits of which they have been so unjustly deprived. I ask that the biU may be appro- priately referred. The bill (S. 2040) to restore veterans' benefits was read twice by title and referred to the Committee on Finance. TAX-KXXMPT SKCinUTIES — ^AKKNSlCXirT TO COIVSTITDTXOM Mr. COSTIGAN. Mr. President, I introduce and send to the desk for appropriate reference a Joint resoluticm pro- posing an amendment to the Federal Constituticm with re- spect to tax-exempt securities. The VICE PRESIDENT. The Joint resolution wlU be re- ceived and appropriately referred. The Joint reeolution (SJJles. 6S) proposing an amend- ment to the Constitution of the United States to permit the taxation of tax-exempt securities was read twice by Its title and referred to the Committee on the Judiciary. roRSxoir nan Mr. BORAH. Bfr. President. I submit a resolution, which I ask to have read. The resolution (SJles. 109) was read, as follows: Resolved, That the BecreUry of tbe Tteacury be. and be Is hereby, requested to send to the Senate a vtatement relative to the debts due to thlB Oovermnent from foreign govemmenta. giving the amount due and In default, both principal and Interest. from the TvpectLvt goTermnenta. Mr. McNARY. Mr. President, personally I have no objec- tion to the resolution, and will probably support it. but only a few Senators are in the Chamber, the resolution presente a large subject, and I think it should lie over for the day. Mr. BORAH. Mr. President. I will say to the Senator that the resolution simply calls for information. It requests the Secretary of the Treasury to submit a statement of facts. Mr. ROBINSON of Arkansas. Mr. President, I do not understand that the Senator presenting the resolution antici- pates a prolonged discussion. Mr. BORAH. No. It is simply a resolution calling for a statement of facts, showing what is now due from certain foreign governments, and in default. The VICE PRESIDENT. The question is on agreeing to the resolution. The resolution was agreed to. 60 CONGRESSIONAL RECORD— SENATE rout or catrmcAn or iLicnoif or ArFonmcnrr or a sinatob Mr. COPELAND. Mr. President. I send forward ft resolu- tion and ask for its Immediate consideration. The Committee on Rules, in revising the Senate Manual, among other defects found that the form for certificates of elecUon. which Is found on page 8. will not now be ac- ceptable, because the date of the beginning of the service fixed in the certificate is the 4th of March. The purpose of the resolution which I am presenting is to change the date to the 3d of January, the date fixed by the constitutional amendment. The VICE PRESIDENT. The clerk wjjl report the resolu- tion. The resolution (SJles. 110) was read and agreed to, as follows: Resolved. That In the opinion of the Senate the following are convenient and ■uOclent forms of certificate of election of a Senator or the appointment of a Senator, to be signed by the executive of any State In pursuance of the Constitution an4 the Statutes of the United States: •* To TH« PaesiDKNT or th» Sknatb or ttte Unotd Statts : " This U to certify that on the — day of , Id — , A B was duly chosen by the qualified electors of the State of '— a Senator from said State to represent said State in the Senate oX the United SUtes for the term of 0 years, beginning on the 3d day of January 19 — . " Witness : His Excellency our Governor , and our seal hereto affixed at . this — day of . In the year of our Lord 10—. "By the Governor: Governor. " Secretary of State." " To THX Paxsnorr or th» Sswatb of tbm Uwrrra States : "This U to certify that, pursuant to the power vested In me by the Constitution of the United States and the laws of the State of . I. A B , the Governor of said State, do hereby appoint C D a Senator from said State to represent said State In the Senate of the United States until the vacancy therein, caused by the of E F , Is filled by election, as provided by law. " Witness : His Kscellency our Governor hereto aOxed at this — day of Lord 19—. , and our seal -, in the year of our Governor. ' Seeretmrg of State.' Aesoloed. That the Secretary of the Senate shall send copies of these suggested forms and these resolutions to the executive and secretary ot each State wherein an election is about to take place or an appointment Is to be made In season that they may use such forms If they see fit. ASSISTAirT CI.nX TO COMICTTKS ON PUBLIC SUILDIIfGS AKD GROUKBS Mr. CONNALLY sulxnitted the following resolution (S. Res. Ill) which was referred to the Committee to Audit and Control the Contingent Expenses of the Senate: Resolved. That the Committee on Public Buildings and Grounds hereby Is authorlaed to employ an assistant clerk to be paid from the contingent fund of the Senate at the rate of glOOO per ^»""»" until otherwise provided by law. roons or oanaa agaixst mrfxas ah> hakboks aotbobhatioics Mr. YANDENBERO submitted the following resolution (S-Bet. 112) , which was referred to the Committee on Rules: Jteso2oed. That the Standing Rules of the Senate be, and they are hereby, amended by adding after rule XX a new rule, relating to rtver and harbor projects, as foUows: " RxTLM XZI. When a rivers and harbors authorisation bill is pending a point of order may be made against the authorization o( any project in any form not formally recommended to the Con- gress In an oOclal report of the Board of Engineers for Rivers and Barbars." - UMXTATXOH OH nCOlCX AND WXALTH Mr. IX>NO submitted a resolution (SJles. 113). which was ordered to lie on the table, as follows: Itetolved. That it Is the sense of the Senate of the United States, and that it accordingly does Instruct the Senate Finance Committee, that it reform all revenue bills coming before it dxa- iBg the Seventy-third Congress, so th*t no person shall have an annwal Income In excess of $1,000,000: so tha* no person diirlng his or her lifetime shall receive by gifts. Inheritances, or other bequests more than $5,000,000: and so that all estates shall be limited so as not to exceed SSO.OOO.OOO to the person. aU surplus above such allowances to become payable to the Oovernmcnt. in cash or In kind, on such terms as may be prescribed t^ said yinance Committee. January 4 TAXATIOH or IHCOME FBOM VHTTtO 8TATBS SBCTJMTIXS Mr. ASHURST. Mr. President. I submit a concurrent res- )lutlon and ask that it be read and referred to the Commit- ee on the Judiciary. The VICE PRESIDENT. The clerk will read the concur- •ent resolution. The concurrent resolution (S.ConJles. 6) was read, as oUows: Resolved by the Senate {the House of Representatives concur- ring) , That it is the sense of the Conpreas that all the Income and Interest from all bonds or other certificates of Indebtedness here- after Issued by the Government of the United States shall be ' axable by the United States. The VICE PRESIDENT. The resolution will be referred the Committee on the Judiciary. Mr. ASHURST. Mr. President. I ask unanimous consent speak for 7 minutes on the proposed taxation of the come and interest on Government bonds. The VICE PRESIDENT. Without objection, the Senator s permission to speak for 7 minutes. Mr. ASHURST. Mr. President, on March 10. 1933, 1 intro- luced a joint resolution (S-JJles. 7) proposing to amend Jie Constitution, granting to the United States the power, ifter the ratification, to lay and collect taxes on incomes derived from securities issued under the authority of any Btate or of the United States. The joint resolution is as follows: Senate Joint Resolution 7 Joint resolution proposing an amendment to the Constitution of the United States relative to taxes on certain Incomes Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (ttro thirds of each House concurring therein). That the following article is pro- posed as an amendment to the Constitution of the United States, which shall be valid to all intents and purposes as a part of the Constitution when ratified by the legislatures of three fourths of the several States: "AKTICLE — "Section 1. The United States shall have power to lay and collect taxes on Income derived from securities Issued after the ratification of this article by or under the authority of any State but without discrimination against Income derived from such securities and in favor of income derived from securities issued after the ratification of this article by or under the authority of the United States or any other State. " Sxc. 2. Each State shall have power to lay and collect taxes on Income derived by its residents from securities Issued after the ratification of this article by or under the authority of the United States but without discrimination against income derived from such securities and in favor of Income derived from securities Issued after the ratification of this article by or under the authority of such State." Mr. President, in introducing my Joint resolution, I pio- neered no new movement, but only resumed the task that was begtm by more capable hands than my own, for it will be remembered that in the Sixty-seventh Congress, second session. Mi'. William R. Green, of Iowa, introduced House Joint Resolution 314. of which my joint resolution is an identical copy, and it will, of course, also be remembered that Mr. Green's resolution on January 23, 1923. received the required two-thirds vote in the House of Representatives, but was not agreed to by the Senate. The vote in the House was yeas 223, nays 101, answered present 3, not voting 101. Many lawyers, respectable in ability, are of opinion, in view of the sixteenth amendment, that no further constitu- tional amendment is necessary in order to lay and to collect taxes on incomes and interest derived from securities issued by the United States or by any State. Mr. CONNALLY, Mr. President, will the Senator 3^eld? The VICE PRESIDENT. Does the Senator from Arizona 3rield to the Senator from Texas? Mr. ASHURST. I yield. Mr. CONNALLY. Does the Senator mean that that can be done with respect to State bond issues? Mr. ASHURST. Only by constitutional amendment. Mr. CONNALLY. I am speaking now only of State securi- ties and Federal taxation of income from State securities. Mr. COSTIGAN rose. BCr. ASHURST. I yield to the Senator from Colorado. Mr. COSTIGAN. Mr. President, is it not the judgment of the able Senator from Arizona that the preponderance of 1934 CONGRESSIONAL RECORD— SENATE 61 legal opinion upholds the necessity for a constitutional amendment if securities now exempt are to be effectively taxed? Mr. ASHURST. I must admit that the majority opinion of the bar is that a constitutional amendment is required. Moreover we may not ignore the following recent deci- sions of the Supreme Court of the United States, holding that the sixteenth amendment did not extend the taxing power to any new class of subjects, but merely removed all occasion, which otherwise might exist, for an apportion- ment among the States, of taxes laid on income, whether It be derived from one source or another. (Brushaber v. Union Pacific RJi. Co.. 240 UJS. 1; PecJfc & Co. v. Lowe. 247 U.S. 165, 172; Eisner v. Macomber. 252 U.S. 189; Evans v. Gore. 253 UJS. 245, 259; Metcalf and Eddy v. MitcheU. Admx., 269 U.S. 514, 521.) Therefore, in view of these decisions, expensive and pro- tracted litigation may be avoided by this amendment, which if submitted by the Congress would probably be rati- fied by the States before the question could directly and finally be decided by the courts. Mr. BORAH. Mr. President The VICE PRESIDENT. Does the Senator from Arizona yield to the Senator from Idaho? Mr. ASHURST. I yield. Mr. BORAH. Do I understand that the Senator's amend- ment proposes to authorize Congress to levy taxes upon incomes of individuals derived from State bonds, for instance? Mr. ASHURST. It is reciprocal. Mr. President, it is interesting to observe that the first exemption of income of State and municipal bonds from such taxation was announced by the Supreme Court of the United States in its famous decision, declaring all Federal income taxes unconstitutional. (Pollock v. Farmers' Loan ers of the administration, the Treasuify Department, and consulted with not a few finan- cial institutions, and they were unanimous in the opinion that the refusal hereafter to issue Federal tax-exempt secu- rities would not in the least hamper the Ctovemment in refinancing, for the reason that thousands of persons have money locked up who are willing and anxious to buy Gov- ei^runent securities, even at a reduced rate of interest and without the tax-exempt feature. I was pleasantly surprised to discover a large number of persons of opulence who said. " We should be glad, so far as we are concerned, if you would remove tax-exempt privi- leges on United States bonds." REFERENCS OF NOIONATIOMS Mr. ROBINSON of Arkansas. Mr. President, I ask for the adoption of the order which I send to the desk, and to which I call the attention of the Senator from Oregon. It is the same that has been heretofore entered from time to time. The VICE PRESIDENT. The order will be read. The Chief Clerk read as follows: Ordered, That on calendar days of the present session of the Congress when no executive session is held, nominations or treaties received from the President of the United States may, where no objection is Interposed, be referred, as in executive ses- sion, to the appropriate committees by the Presiding Offlcer of the Senate. Mr. McNARY. That conforms to the general inractice. I have no objection to it. The VICE PRESIDENT. Without objection, the order will be entered. ARKT NOMIMATIOirS Mr. McNARY. Mr. President, on page 4 of the list of nominations received today I find the following general statement: Also a number of promotions In the United States Army. Heretofore, as I recall the practice, all nominations have been submitted by naming the individual, so that each Sen- ator may know for whom he Is voting or urge any criticism he may have as to the nominee's ability or character. To make a general statement that hereafter at some time a niunber of Army promotions may come before the Senate, e2 CONGRESSIONAL RECORD— SENATE January 4 without naming the Individuals. I think Is not fair to the Senate and I should like to have an understanding with the Senator from Arkansas relative to that general state- ment. . . Mr. ROBINSON of Arkan-sas. Mr. President, it has beer the practice to list the nominations, even though they are routine nominations, and I think that pracUce had best b€ ' pursued. . ^w « The VICE PRESIDENT. May the Chair say to the Sen- ator from Oregon that he is informed by the clerk that they are listed in the ofBcial communicaticwis sent to th€ Senate. ^ . Mr. ROBINSON of Arkansas. They are not. however listed in the printed list that has been supplied to me. The VICE PRESIDENT. The Chair is advised that that is a memorandum, but that the ofDcial list contains the names. Mr. ROBINSON of Arkansas. I suggest that the names of all nominees be printed on the list that is supplied. ] think it would be convenient to have that done. Mr. McNARY. That is substantially my request. The VICE PRESIDENT. All the nominations as sent tci the Senate will be printed in the Record. Mr. ROBINSON of Arkansas. Very well. That, I an wire, will meet the suggestion. EXECTTTTVE MESSAGES RETERKED Under the order previously entered today, sundry cxecu tive nominations were referred by the Vice President to th< i appropriate committees. PROPOSED ABOUTION OP THE ELECTORAL COLLEGE Mr. NORRIS. Mr. President, there Is pending in thi; Committee on the Judiciary a resolution to amend the Con • sUtution of the United States by the aboUshment of th; electoral college. There has been prepared an article bear ■ Ing particularly on that subject, though it bears the titl; " Some Obsolete Features of our Federal Constitution." Thi i article has been prepared by Judge Charles Sumner Lob- Inger, professor of ctMnparative law in the National Univer • sity, of Washington. D.C. I ask imanimous consent tha; Judge Lobinger's article be printed as a Senate document. The VICE PRESIDENT. Is there objection? The Chair hears none, and it is so ordered. EVASION OP TAX PATMSKTS Mr. DAVIS. Mr. President, I ask unanimous consent to have inserted in the Record and referred to the Committe e on Finance a communication from Mr. C. G. Cunningham. of Pittsburgh, Pa. The communication has reference to lecialation affecting prevention of tax avoidance. The communication was ordered to be referred to tte Committee on Finance and to be printed in the Recor). fts fcdlows: Peatt St Whttwet Co.. Hartford, Conn., Jmnuary 2, 1934. Hon. JAMXB J. Davis. Senate Office Building. Washinirton. D.C. Dbak Skhatob Datis: We respectfully call your attention o H.K. B0O4. paaaed at the last session of Congress by the Hotue. •.rut now pending in the Senate Finance Committee, being an N act entitled. "To validate collections of Internal-revenue taxos ttmfmd by requests or claans for credit, and for oUier purposes '. and to the recommendation (part n. no. 29. at p. 23) of tlie report of the subcommittee of the Ways and Means Commltt« •Btltlad. "PrevwaUon of tax avoidance", this particular recom- mendation being that the provisions of HJt. &904 be lncorparat4d into the proposed general revenue bill. We desire to enter our protest against this proposed legislu- tlon as most imfalr and discriminatory, and we respectfully r »- quest your consideration of the following reasons against lis enactment: The proposed provisions relate only to taxes assessed prior o June 2. 1934. almost 10 years ago, and to credits made prior - for. wan ftlsd and the ocAlectlon of the assessed tax thereby pas i- poned: and the second part relates to credits made In a llmiUd class of easaa where no dalm or request for credit was fUel. However, the caption of the WU. and the only statements made on the floor of the House at the Ume the bill was passed by the House, created the erroneous Impression that the entire hill aoDlles only to cases where collection was stayed or postponed by claims for credit (CoNoaEsaioNAL Bmcow. 73d Cong.. 1st sess.. An examination of the Record above referred to indicates that the bill must have passed the House on the understanding that It aoplled only to cases where an extension of time had been eranted by the Government by reason of the filing of a claim for credit The fact of the matter is that the mere flling of a claim for credit did not extand the time for payment of a vax and the Internal Revenue Bureau haa consistently so ruled. (For example, see I.T. 1373. c:B. I-l. p. 318. pubUshed June 1922.) Probably the most objectionable feature of the proposed legls- laUon is that it resulU In discrimination by the Government between taxpayers. It proposes to repeal the statute of limitations as to some taxpayers while giving the benefit of that statute to the great majority of taxpayers. It has been the consistent policy of the Government to fix the period of limitation for the colle«:- «on of taxes, and such a statute of limitations should be applied to all taxpayers equally and without discrimination. The statute of llmlUtlons has been applied as enacted by Congress and inter- preted by the Supreme Court to the great majority of cases, but now it Is proposed by legislation at this late date to repeal the statute as to a few taxpayers who have not been able to persuade the Government to allow their claims or who have been unfor- tunate enough to have them delayed In litigation. It should not be forgotten in this connection that a similar statute of limita- tions protects the Government from having to refund taxes erro- n-jously and illegally collected unless a claim therefor is filod within a fixed period of time. Many millions of dollars otherwise properly refundable have been retained by the Government on this ground. It Is highly Improper for the Government to claim the benefits of our statute of limitations, which enables it to retain taxes overpaid, and at the same time to deny the benefits of a corresponding statute of limitations to a small group of taxpayers whose cases are now pending in court. In our own case suit was filed in the Court of Claims on May 2, 1929. and the evidence was completed on July 17. 1930. Shortly thereafter counsel for the Government recommended that the claim should be paid, and accordingly at the request of the Government a motion to dismiss was filed in escrow with the attorneys for the Government on the assumption that the recom- mendation of counsel would be promptly followed and the claim paid. However, the Treasury Department declined to follow the reconunendation of its counsel and now, after delaying the case in litigation, it is proposed to pass legislation which will prevent the covut from awarding Judgment. In the meantime many cases have been decided in the courts In which the taxpayers have been given the benefit of the statute of limitations as interpreted by the Supreme Court in such cases as Bowers v. New York «fe Albany Lighterage Co.. 273 US. 346; United States v. Swift « ttntorto of ••"~^" 'J'rj-lli. nentai^r OeMlor the U IS not difflcult. A maffl of testimony h«8 been *«^° »*?~f "• ^TicU wa5 the flnrt. which died, and then the second. wWch died. and now we have the Third International. The third one waa formed In 1919 by » J»n»«»^ "^ £™?: mtin^t del«»tea in Russia for the purpoee of conducting a world SSy ?^f?^^u^ Party In the United State, to one unlV T?^^DUiio^^ the parent organization In Buaala U to carry on S-oJSSSTt^e worlTVhe revolutionary "»""°?}L,1n'^trSe munlrt Party and the Soviet Union. How U It Uod In wlw* ^ Bu«Sii sSLt Government? That 1. explained In the «POrt of 5,e sp^lal congrwalonal committee Investigating Oommunlst ac- tTvitf^Tln the United SUte*. " The Communlat International (or SSSTlntemLSSS? to dominated by the Ru«lan Communtot ?Sf? and SJSt oOclala. and could not exist without the whoje- Slrted support of the leaders of the Bu«rian Commuidst P«rty JS^e toknclal backing of the Soviet Government The two mnference. The London Conference refused to ^ndore^ ^he 1^ minam of sUver or to fix any ratio between gold and sUver. The SSdJn?-s ^I'aSatTon was intended for the Purpose of cairylng out thT London agreement so as to limit the silver supply in the '"?^' Sl^r'sfr^nran ounce was not Intended to fix the prSf o? Sv« S^ver It was a price substantially 50 percent &hove the then world market price. . ^ %,.. I^ould tJfnk that every miner in the U°"«^8tat" would be Kratlfled for such liberality, especially as most of the Presidents economic advisers suggested a much lower price. r^^^^rr,^ This nroclamaUon in no way whatever Interferes with Congress, in™ fflS^" will aid congress, because It is much easlerto obtaii ^e free coinage of sUver at a valuation mined supply through the London agreements which wUI !Juyli?«MO.Oa) ounces or thereabouto. Such wUl be substan- tlallv 30 percent below the normal world supply^ iS^sTT silver coins to replace low-valued paper currency under the London agreemento will Increase the demand for sll- vS- IndSstlS recoVSrThroughout the world will advance more S^idly than the production of sliver. These things clearly Indl- Su that there will be an Insufficient supply of silver In 1934 to °'Sl."Sw°;f",^l?\"i''demand will Inevitably cause bidding for sUver. which will result in a rising price. * , ^.* k« It i; not improbable that under these natural 1*^8 sustained by the London agreemento sliver will rise to parity, that is, »1.29 an ounce, before the end of 1934. . ^^ . ... ^^K^^^^A NoW. this congress may pass an act for the free and unlimited colnag^ of all silver at the ratio of 16 to 1. Personally. I think it would be a great benefit to the United SUtes and the «^t of the world I have no fear whatever, under such an act. that there would be a flooding of our country with silver. I am satlsfled that the people of India and China, constituting nearly half of the people of the world, would continue to purchase silver as the price rtSee and would not permit It to move Into our minte for coinage. Such has been the experience, at l«ast In the past^lth rwd to the artlon of the people of China and India. The people of these two countrlee. when silver was above »1 ap^ounce In 1918 1919 and 1930, bought annually over two thirds of the silver supply. They continued In 1919, when sUver reached $158 an ounce, to buy more than their normal amount of silver If It were necessary to prevent the flow of silver from India and China to the United SUtes mlnte, the govemmento of those coun- tries would undoubtedly place an embargo upon the exp^Oatlon of silver as they have threatened to do In the past. That la my belief In the matter, but all the proof that I have in support of this opinion is the arguments that I have Just used. I regret to say that an overwhelming majority of the economlsto In this country do not agree with the position that I take. I do not believe that they are Informed with regard to the supply. cemo- cratlc platform and bringing about the consummation of the liondon agreement. With expressions of resiject and best wishes for everyone en- gaged In the mining industry, which has suffered so terribly. I am, sincerely yours. Krr PrrxMAM. Waixace, Idaho. Deeeniber 30, 1933. Bon. KsT PrmtAH. United States Senate, Washinffton, D.C. Dkas SawAToa: The Wallace Board of Trade, of Wallace, Idaho, is disappointed In the action of the President In authorizing the purchase of domestic sliver at 64^3 cento per ounce. We believe that fixing the price of sliver for a 4-year period, with a rising market for gold, will be of little beneflt to anyone and may barm the producers. If the 80-cent dollar Is finally achieved, It wUl mean that gold will reach a price of Ml. 34 per ounce. The sUver producer then would receive 64 Vj cento per ounce In currency depreciated 60 percent and would really be receiving but 32 V4 cento meas- xired in giid. In the West the Presidents action will really result In a lower Instead at a higher price for silver. With gold priced at $34.06 (Ito present price) per ounce, the 64^ cento per ounce price for silver really means 39 >4 cento per ounce, measured In gold. The average yearly price of silver from 1873 — the year silver was demonetised — to 1933. both years lnltal stock of the following companies by the amo\int sUted — the day's net gain in price multiplied by the number of shares outstanding. Company : Gains AUled Chemical .: $14,400,000 American Can $,896,000 American inciting 10.980,000 Anaconda 17,354.000 Cerro De Pa^o 5,616.000 Chrysler — 17. 480. 000 Du Pont 64.380.000 General Motors __._ _. 87.000.000 Howe Sound 1,984.000 Johns ManvlUe 2,280.000 Sennecott 20,874.000 Montgomery Ward 8.800.000 Pullman 11,460,000 St. JoKph Lead ' 3.900.000 Sears Roebuck 12.662.000 Ttanken RoUer C 824. 000 Union Carbide 18,000,000 Utalted SUtes Smelting 6,309.000 united States Steel 17.406.000 Now we have two sharply difterent fiticem for sliver Just a. we have two different prleea for gold. The Oovemment. as already told, pays 64 V^ cento for newly mhoed sliver, against the open- market price of 43% cento. The Government's quoUtlon for newly mined gold 1. $34.06 an ounce, whereas the open-market prlo. 1. at least $10 an ounce leM. Abnormalities? Yes. But we are llvlxig imder abnormal condi- tions. Our duty, as loyal cltlaens. Is to exercise to the limit wHatcrw Influence we may pouess to bring about wise, statesmanlike action by Washington, to criticise when we cannot oonMlentloualy endorse, but to play the game patrlotlcaUy, constructively under whatever rules are In force. Persuasion, nirel Sabotage, not Hii4>pUy, President Boowvelt has little occasion to eomplata that hi. poUcle. and programs have not been accepted with remarkable grace and supixirted with unpreeedented unanimity. Indeed, no Chief Executive since Washington has ever been ae- corded such carte blanche or ha. been so universally upheld by cltieens of all political shade.. Continued good luck to himi STATumrr bt SXMAToa Kbt PrmcAM at thb CostvauDfOiAT Wash- inctow on NovxMBxa 17, 1933, Caubd .t th« CoMicxrrxB roe turn Nation to Consider Puins for an Aosquats Mctaixic Bass roa A Sound Cttrsbnct cold and SXLVn as sound CUaSSNCT I consider the only safe tmd sound base for International ex- change and domestic cturency to be geld and silver. The reason. In support of this opinion are; 1. Gold and silver have both been ueed as money everywhere throughout the civilized world since the dawn of elvlllzatlon. 3. Gold and sliver have all the requisite, of money, namely: Resistance against destnictlon, found In nearly every part of the world; precious metals because they are now and always have been scarce; uniformity of production throughout the ages; uniformity of ratio of production with relation to each other; and Axed hablto of pcojde to use both metals a. money. BBFINITIONB OT BnSBTAJLUm There are two definitions given to the word " blmrUlllsm." One definition Is the use of the two metals, gold and silver, as equal bases for currency Issue. The other Is the use of both metals for currency Issue, but having only one metal as the base and measure of value of the other metal and all currenclM. Under the first mint act of the United SUtes, In 1793, our Government eetabUdked bimetallism under the first definition; that is. both gold and aUver were concurrent baM. for currmcy liwue. ACT OF 18TS MAinta OOLD UNTT OT VATUS IN OUrTRU WTAI By the act Of February 12. 1873, gold alone we. eeUblished a. the imlt of valxie, and the sUver dollar was deprivtA ot part of iU legal-tender function. Since 1873, our OovemmMit ha. main- tained blmetallUm under the second definition. It hae continued the coinage of subsidiary sUvcr and from time to time has cdined standard sliver dollars. Xach one d our sUndard silver doUen contains about 0.78 of an ounce of pure sliver. Five of racb standard silver dollars conUin only about 3.9 ounce, of sliver. Yet without regard to what the world market price of sliver may be, the value thii thii 1 till an ounce. That Is to say. 5 standard silver «»o»»"' J»^~^ Uln 3.9 ounces of silver, are exchangeable for a »5 8°^ note am before we went off the gold standard were exchangeable for a »« gold piece. „.^ This meuis that the 3.9 ounces of silver In the five ■"»« f o'J^ were valued at M. or at the rate of 91.29 an °^^^J^'"^ means that the value of the silver ounce was one sixteenth of SSS^of the gold ounce. The gold was fixed «t •a0^«7 an oun« Juvw was fixld at $129 an ounce, which U substantlaUjr 18 to^ The gold dollar contained 23 J grains of pure grtd. The sllvf dollar conuined 371 U grains of purs sUver, This U. again. ^ ratio by weight of 19 to 1. gATio or stLvn to totau cincvLAnno cvmewct Our Treasury Department Is required by law to maintain Kity between our gold cttrrencies and our silver eurrenciM. never had any trouble doing it, and yet we have not had insignificant amount of silvitr currency; in fact. X twnK t even our great nnsnciers and some of our noUd eeonomlsU wl be BurprlsSd to b» given the figures On September M, 1933. tt total circulating currency of the United BtaUs wa« •6,d49,9l4,ll Of this currency, the total silver currency issue was 9«78.390,»4' These figures are taken from the report of the United 0tat4s Treasury under date of September 30. 1933. It will bo obeervgd that silver currency U a little over 13 percent of all our current y in circulation. In 1900 o\ir silver currency was 30 percent of our total cu rency in circulation. We could Increase our silver currency o"* IIJKM.OOO.OOO before reaching the proportion of sliver currency circulation to the total currency In circulation In 1900. ACT 0» MAT 18. 1S33, MAKES SILVCB FUlX LXCAL TKNOSa By the act of May 12, 1933, Congress declared all of our stand ard silver dollars — In fact, all of our silver cvirrency — full '"'-*' tender for all debts, both public and private. Does It not seem strange that financiers and economists still look upon silver as nothing but a commodity, like potatoes? Take the other great coxmtrles of the world, Great Britain, Franc e Italy, and Germany. Do these great countries treat silver only *" a commodity? No! All of them have silver coins, such as have. All of them maintain the parity of such silver coins - their gold currency and other cvirrencles. Just as we do, and stantlally on the same ratio. There are 13 governments In world that carry silver as legal reserves against ciuxency *' Some of these countries have as high as 30 percent of their reserves in silver. And this is exclusive of China. China, course, is exclusively upon a sliver monetary base. Holland, instance, carries a large part of its legal reserve in silver, imdcr Its law reserves to Itself the right to redeem its cr- in gold or silver, as It sees fit. Just as we did prior to 1873 we demonetised silver. By the act of May 12. 1933, we ha^e authorized the payment of all debts, public and private, in •Uver coin. Sn.VKB THE MONXT OT THX ORIXNT ov(ir legil wU ue wl'h su )- tlte issie. legal 3f far and curren :y whun oir The people of the Orient, who constitute approximately of all the people of the world, have used sliver almost exclusiv as money since the beginning of time. Whilst India has b€ on the poxmd -sterling basis since 1893, still the money of tfce iMMtles of the people of India has been, and still Is, silver. OOU) AKO SILVOt EATIO Or PBODUCTTON How is the preciosity of gold and silver determined? By lk\e supply, and by the demand, of coxorse. What has been the supi >ly of sliver? According to the report of the Director of the Mi it for the last 400 years the average production of gold and sU^er has been 14 ounces of silver to 1 ounce of gold. Napoleon fljed the ratio of silver to gold at 15 to 1. England, about the sane time, fixed the ratio of sUver to gold at 15 Vj to 1. This, of couise caused silver to flow from Great Britain Into Prance. We first established the ratio of gold and silver at approximately 15 to 1. We subsequently increased the value of the gold dollar, wh ch changed the ratio to about 16 to 1, which it is now. Until l|18 there were no laws discriminating against theruse of silver, allver had Its natural value based upon the relative supply gold and silver and Its equal use. In 1818, and at various Since then, laws have been passed by governments reducing demand for silver by reducing its use as money. The final monettzatlon legislation against silver in various countries about 1873, at the same time that our Government went udon the single gold standard of unit of value, and limited the legfd- tender character of the standard silver dollar. SILVKa ADJUSTS TTSKLr TO NEW STABLE PEICS Silver adjusted itself to this limited iise. and the price of sll throughout the world became quite stable. When our Gove ment and other governments were still coining silver pieces the approximate weight and value of the standard silver dol silver was around 81 an ovmce. When, In 1893, ova Govemm ceased to coin standard silver dollars, silver In the world dropped to around 60 to 65 cents an ounce. There the price remained stantlally stable until Great Britain. Prance. Belgium, and countries, after the World War, ccTnmenced to melt up tl^eir silver coins and diunp the silver derived therefrom on the of the world. MELTING SILVEI COIXS WEAKENS PKICB That again depreciated the price of silver to some extent, ^ut to no great extent, because such lumatural supply of sliver was apd of tlrtes 1he (le- pras nuirkets RECORI>— SENATE January 4 1934 CONGRESSIONAL RECORD—SENATE €7 h ilf ( ly begn limited and could be ertlmated. In 1928, however, the Govern- ment of India commenced to melt up the enormous supply of the sUver rupee coins of India and dump the silver derived there- from on the market of the world. This brought about an over- supply of sUver. and the price commenced to fall and continued to fall by reason of this continued imnatxiral oversupply. and by reason of the power of India to sell unlimited quantities of such silver at any time at any price. MBLTIIfa »r INDIA OESraOTS MAEKST The people of India complained bitterly of such governmental action because the reservoir of their wealth was being thereby consuntly reduced. The president of the Bank of Issue of Inrtl* has recently sUted that the restoration of the price of silver would do more than anything else for recovery throughout the '^ tUm is cctimated to wiat in the world today about 313.000^ 000 000 in moMUty gold, and about I3,000.o6o,000 ounces ot SRir lS„^ Let me say that In what has been done, the Government has had three general purposes: First, to protect property rights: second, to restore the purchasing power of the people by providing Jobs for the imemployed and Increasing the wages of those who are employed- and. third, to raise commodity prices to such an extent that those who have borrowed money will, on the average, be able to repay that money In the same kind of dollar which they borrowed. We can agree that no property is of greater Importance than the savings of the people. Savings represent not only toll and sacri- fice but represent the hope for protection in old age and protec- tion for dependents. For years little was done by government to protect the property which had been deposited In the banks of the Nation. Then 4 years ago the great " parade " started. Within 4 years 4,000 banks closed, and on March 4 the remaining Insti- tutions closed. In order to protect the property of the people, the Government has now legislated to regulate banking, to force the great national banks to divorce themselves from the corporations they organized for the piirpose of doing through these corpora- tions that which national banks, under the law, could not do. As a result, national banks of the great cities can no longer Invite deposits from the so-called " country " banks and lend those funds to aflUlated corporations so that such corporations can Invest the funds In the'purchase of doubtful domestic securities and worth- less foreign securities. Government has Interfered to stop the payment of Interest upon demand deposits. This practice resulted In competing for deposits and the payment of rates of Interest which was made possible only by banks engaging In speculative transactions. The Government has Interfered to establish an Insurance fund, one third to come from the Treasury, one third from the profits of the Federal Reserve banks, and one third from assessments upon the deposits of the local banks. The Association of Reserve Banks, m opposing this policy, argues, plausibly, that the remedy for the evil lies not In the guaranteeing of deposits but In amending tho banking laws so as to Insure sound banking. All men agree that if the banking laws can be amended so as to Insure sound banking they should be Immediately so amended. If the bankers will sug- gest the amendments that will have this beneficial result. I am 1934 CONGRESSIONAL RECORD— SENATE 69 sure that the Oongress will adopt the amendments, even though | they may regret that the secret of sound banking has been so long withheld. If these gentlemen are correct. tb«e will be no harm In retain- ing the insurance at deposits, because if by reason of their amend- ments sound banking results, no losses will be incurred by th^ banks and no loss will result from the guaranteeing of deposits At the same time it will give seciirity to depositors, bring Into the banks money now hoarded, and give relief to stockholders who have been living in fear of the stockholders' liability to depositors. The Public Works Administration, with Its loans for the con- struction of public-works projects In order to provide Jobs for the unemployed. Is critlciaed as a willful waste of public funds. It Is waste only If the money Is not to be repaid. I know that even In South Carolina some men of prominence have been advising the people that the probability was that they would not be called upon to repay funds borrowed for the construction of these projects. I have never borrowed moriey with the Intention of not repaying It. and I do not want my municipality, county, or State to do that Which I as an individual would be unwilling to do. The money used in these projects is borrowed by the Treasury of the United States. If those who now borrow the money fail to repay It, then when the obligations of the Government msture those obligations must be paid by taxing the F>eople. Those taxes will be paid not only by those who live in the cities where the stadiums and swlnxming pools are constructed but by those who live in the ■mall towns where no projects are constructed and by the farmers of the Nation who will never see the projects. It may be true that some men In public life will seek to cancel these obligations, but I have enough confidence in the honesty of the people of the Nation to believe that payment will be insisted upon, and certainly I can say that if prior to January 1937 such cancellation is sought, even if It be advocated by every municipality In South Carolina that Is today borrowing money, my vote will be cast to require those who borrow vhis money to repay it to the Governnent of the United States. In the effort to restore the purchasing power of the farmers ol the Nation It was necessary not only to Increase consumption but to curtail production. In CH-der to do this, processing taxes were levied to secure funds with which to compensate the farmers fta the abandonment of acreage. It Is argued that this tax is an unjust levy upon consumers and amounts to a subsidy to the farmers. It does Involve practically the same principle as the levying of protective-tariff duties. For years the manufacturers have demanded that protective-tariff duties be levied in order to enable them to collect from the farmers and other people of the Nation a higher price for their products. The levying of such tariff duties was called " statesmanship ". but when the same prin- ciple is temporarily resorted to in an effort to restore the pur- chasing power of the farmers of the Nation it is demagoguery. and It is dangerous. It is urged that loans to refinance mortgages and loans for con- struction projects made in the hope of restoring the purchasing power of the people constitute an abuse of the powers of gov- ernment and are an unwarranted use of public funds and of public credit. This charge, however, is generally made by the men who In 1932 urged the creation of the Reconstruction Finance Cor- poration. By reason of the loans that are made today to munici- palities and to the home owners of the Nation we may Incur some losses, but I venture to say that the loss will be Infinitesimal as compared with the losses resulting from the loans made by the Reconstruction Finance Corporation to the railroads, banks, and Insurance companies. Before we condemn the Public Works Administration and the ClvU Works Administration we sboiild determine what is the alternative to these policies. We cannot liicrea.'je the price level of agricultural commodities and then do nothing to put back to work the unemployed people of the cities, whose purchasing power must be restored in order to consume the products of the farm. It is better to provide work than to follow the English In resorting to the dole with Its evil effects upon the beneficiaries. Critics even extend their criticism to the efforts of the Govern- ment to relieve the suffering and the destitute. The Federal Gov- ernment did not enter this field until the sovereign States of the Union, throtigh their chief executives, certified that charitable organization and local governments had exhausted their funds and urged that the Federal Government alone had the credit facilities to secure the funds necessary to aid the needy. It is charged that some of the money Is wasted. That Is true of every fund that Is spent for a charitable purpose. Even If It be true that as much as one third of It should be wasted. If the other two thirds shall serve to save human lives and prevent human sutter- Ing. the expenditure Is Justified, for the United States Government, with Its wealth and Its credit, can never sit Idly by while Its people suffer and starve. Stm another effort has been made by the Government to solve our problems by the operation of the National Recovery Adminis- tration. Inevitably it involves an interference with the .ordinary business activities of the Individual. It further necessitates action through groups Instead of through the individual. I cannot now discuss Its operation or its success. I call attention simply to the fact that It Is not the first time the Government has so interfered. and it has usually interfered at the behest of business and tor the proflt of business. It was at the request of the railway executives that the Ssch- Cummlns Act contains a provision that before any railroad which Is to engage in Interstate commerce can be constructed there must be secured a certlflcate of public convenience and necessity. In order to protect exlstl^ railroada against ttaa destructive oom- petiUon due to overaealous prmnoters. they asked that Govern- ment deny to an individual who has money with which to build a railroad the right to build unless It can be shown that It Ls neces- sary in order to serve the pubUc If the pajrment erf a pittance to farmers In order to curtail pro- duction U a subsidy and Is communistic, then why U It not equally communistic for Government to pay subsldias to some corpora- tions in order to promote the construction and devek^ment of the merchant marine? Why is it not communistic to pay subsi- dies to aviation corporaUplanted despair In the hearto of the people. There are those who admit this progress, but say that the p«l- cles by which It is accomplliaied are revolutionary and threaten to alter our form of government. These policies may somewhat CONGRESSIONAL : lECORD— SEN ATE 70 alter the fonn of our Government but wUl not alter ^J^* "P^" °' our GovernSnt They may be ideallrtlc but they are not rev^u- ?lonS ^nd at this time we ""^y ,^ Jf'J^f °**fi,i° ^'' Jf "^j! ^"^*£^aL"d rt\?Tv?;ion'b?The"lL?n1iaMeyer; oTZ Nat^'n. wh^o have for yeaSiien held up to the people a« the exemplars nf husfniss InSrrlty has done more to destroy confidence of the ;'eopVl\nThe°i?aS2hlp of the Nation and ha. ^one moreto^nj^e our Government, than all of the new pollcle. Inaugurmted by the Government for the relief of the people^ .h^ii^Ic or rovolu- Whether you believe these policies to be idealistic <» J^^o"\ tlonarv vou have the knowledge that most of them are *^^orlzed bv Confess only for the period of the emergency. When the emergen^^asses they must pas.. For permanent Pro^Pf'-^y- »" tShtful men know we must rely upon private enterprise, with on?y ^uch gS^vemment regulation as is ^^^'^HZ^^S^^^. of individual rights. The people have given ^^^^^f-J^SS^^Pd port to such policies as the National Recovery Admlntoteatlon and the Aerlcultiiral Adjustment Administration, became th«y toow Slt^ orders accLplish any recovery itl. es^tiij to ^U^ production In field and In factory, "niey Jmow thl^ this amnot be done by Individual effort^that it must be done by govern- ment. But when these mea«»re. have brought about «^«fli"fj- ment of production to consumption, the very ?«»?»• ^'^f.. J*!* SUn mos? urgent in their demand, for fo:«™°fir^'iJ?; will be most urgent In demanding th*t government c«-eiU reg ulatlon of business, and the people of ^he Dnlt^J^*- t^« ^ happy assurance that their Government will reqwnd to the will of the people. THE C.\SB FOR BIMrrAI.LISM— ADDRESS BT HON. CHARUB 8. THOMAi Mr. KING. Mr. President. I ask unanimous consent tc have printed in the Record an article by the former Senatoi from Colorado, Hon. Charles S. Thomas. The arUcle is en- titled " The Case for Bimetallism ". and Is a comprchensiv< and able discussion of what is commonly called the " silvei question." ,x j o* * Senator Thomas is known throughout the United State i as one of the ablest statesmen of his day. He was Govemoj of his State and served with distinction In the Senate o the United States. Senator Thomas has been one of the ablest champions of sound money, of genuine bimetallism and no man has given more profound thought to flnancia problems than he. and no man living knows as much abou ; the cause of bimetallism as does Senator Thomas. Hii article is an able discussion of a vital question, one which demands attention at the hands of Congress and calls fo immediate and favorable action. The VICE PRESIDENT. Is there objection to the reques t of the Senator from Utah? There being no objection, the article was ordered to bp printed in the Record, as follows January 4 THX CASX FOR BIMETALI4SM Jefferson and HamUton. representing two schools of pc^i"<^ phllosoDhy. dominated the political development of the Natloa from Its commencement. They werte entagonlsts. always, yet li cordial a?reement with the structxire and design of our monetary policy, which was not surprising: for there was little ground i a their day for discord. Mr. Jefferson constructed the legislative framework and the report upon which he submitted to Mr Han - ilton s Judgment. Its basis was bimetallic, and in accord with tHe worlds monetary history from. If not before, the beginning served that the natural law of production of gold and sllvsr yielded the two metals in a constant and practically undeviatiiig proportion of approximately 14 parts of sUver to 1 part of gold Hence, the establishment of the equivalent of that ratio for mea s- urement of their value in exchange became not only conveniert. but essential to the establL^hment of an unchanging measure )r sUndard of other commodities; hence, Mr. Jefferson, originally Inclined to sliver as the bs^is, because less liable to fluctuatloo, easily adopted the view of HamUton. who asserted that " to ann il the use of either metal is to abridge the quantity of the clrc i- latlng medium, and is liabltj to aU the objections which arise fro tn a comparison oX a fuU with the evUs of a scanty drculaUoi . " " Let the standard " added Jefferson. " rest upon both metals." T^tS^ ^ fiSd at ??.^ parts of silver to 1 of gold by weight. ™8 svstem so carefully devised and launched upon the infant NaTTon "S^m functioned perfectly until 18?«v7f,«^„\»^« J*^° was altered from 15Mt parts of silver to 1 °' 8°;^, ^°/ Ju* VacUoS law of that year as to sliver doUars. the weight of aU fractional silver coins remaining as before. „„._ S ?ii of any other than the bimetallic «yf*«^^ °' "J^^JJ under our Constitution or the exclusion of one of them for the ot^er or at aU probably never occurred to anyone prior to the Si"o?the act ofTsTS al within the legislative power of Congre^^ James G. Blaine, in 1876, asserted that Cong^'^. J«*.J^° JJ S power to demonetize either one of the metals than it had to ^'SSSeV We^S^iiV emphasized the same <^"^f '°° ^r^ ^anS bv declarinK that " I am certainly of the opinion that gold and Kver Ift^e rates fixed by Congress '^^^'J.^^^f l^^/^^^J*??; ard of value, and that neither Congre^ nor any State has the authority to establish any other standard or to di»Pl»«e this Sandard" What intelligent and unprejudiced man can P»*c« '"y oSier construction upon the constitutional Inhibition that no State shaU make any^lng but gold and sliver coin a legal tender In navment of debts "? Not one but both. -ffeTeW Of our silver mmes was, untU the J****;: ^f ' °' ^?* nineteenth century, not remarkable, whUe from 1849 gold in SSmSSs quantltii; from the new Und of California profound y Sluenc«J the country's social and economic expaMton. It did not. however, effect any change in the f^%*"^f °' f^, 5™?"^ system until the passage of the Coinage Act of February 15, 1873, wheTthe law of 1792 was radically changed by the demonetiza- tion of sUver. although the silver doUar was 'Stained as the na- tional standard of value until 1900. when the gold doUar of 8.25 grains was substituted for it. M.*,«„ai * The act of 1873 was inspired by the owners of the National Securities, the outgrowth of the American Civil War of 1881 -«5. This debt, beginning in 1861 and '^"^^ ;^;f ^^^^''^''}^l''^'^^ reached, In 1866. the enormous aggregate of $2,775,763,929. and drawing annual Interest at differing rates until refunded. Subse- quent legislation affecting these bonds always enhanced their values in terms of gold, and, of course, at the expense of other forms of property. ..^ ^ ,«-- *_ Legislation In the Interest of the public creditor, from 1885 to 1873 therefore contracted the medium of payments, first from paper to coin, and then to gold, easily doubled the burden of the debt during the decade of 1875-85, and at the same time shrunk the national monetary circulation by half Its volume. Sliver was deprived of Its legal tender function save as to Indi- vidual payments not exceeding $5 at one time, while contracts involving time payments were authorized to be paid In gold only. This effectually closed the door to the remonetlzation of sliver. It was thereafter possible only by political revolution, which has been coming on outspread wings since 1929. It Is a bold man who famUiar with the course of these events, would deny that they have constantly aggravated the financial difficulties of the world developed chaotic and constantly expanding economic disasters everywhere, and bound to culminate In world bank- ruptcy unless prevented by radical and far-reaching monetary and economic changes and policies In all public and private commercial affairs. It Is the story often repeated of greed, dis- honesty, and disaster, of the robbery of the peoples substance for the enrichment of the public creditor. We first hear of a single, or gold standard of money In 1816. It came with the act of parliament of that year demonetizing silver and making all liabilities, public and private, of the British Empire payable In gold or Its equivalent, measured by the fineness of the English pound sterling, as then coined. The victory of Wellington over Napoleon In 1815 automatically and enormously enhanced the market value of the British consols The House of Rothschild, then the owner of a preponderant amount of these obligations. Inspired the promotion and enact- ment of the gold act of 1816, designed for, and resulting in. colossal profit to that great banking house and other public creditors, which will recall the terrible suffering and misery of that generation of Englishmen, coming with the inevitable result- ing panic so vividly recorded by Mr. Archibald Alison, the English historian. Here, let me say. In passing, that every enactment of history, whether in Europe or America, tending to disturb or overthrow the old bimetallic financial system, on the one hand, and exalting the gold system on the other, has been Inevitably followed by a long-continued and heart-breaking season of panic, bankruptcy, failures, shrinkage of circulation, confiscation of all forms of property. Indeed by the whole train of economic disasters consequent upon these deliberate interferences with the general progress of nations. Just here, a brief review of oiu" national debt legislation Is essential. The first isue of our bonded Indebtedness was made payable In "lawful money." The only money available was the greenback, then passing at par. Gold and sUver, true to their instincts, fied the continent at the first note of danger, the paper dollar rapidly depreciated, finally reaching the low rate of 38 cents in specie. The great bulk of Government Civil War bonds were bought around 50 cents to the dollar, and, therefore, at one half their face value. With the end of the war came both peace and a rise in the Government security market, swiftly followed by clamor for payment at par in coin of the realm. The great majority of the country, under the leadership of Thaddexis Stev- 1934 CONGRESSIONAL RECORD— SENATE 71 ens, demanded payment to the creditor in the money with which he purchased his bonds, but, of course, at pmr. This was bitterly and successfully resisted; the contest culminated in the Act of 1869. ironically entitled "An act to strengthen the public credit ", which enacted the redemption of the public debt in coin of the existing weight and fineness of official coins of the United States. This law, ostensibly, settled the dispute In favor of the creditor and to his inunenae advantage. Notwithstanding his victory, a brief 4 years afterward the Coinage Act of 1873 was passed and approved. Its full import and purpose were not realized tintU long after it had received the President's signature. When its character was revealed, an exasperated Nation was confronted by the fact that the bimetallic system of money had been quietly destroyed over night — that only gold was legal tender and pay- able in the dischargee of all public and private UabUlties. Mean- time, the country had passed Into the grasp of the awful panic of September 1873. which continued for the next 6 years, ac- companied and foUowed by the Inevitable consequences of misery and ruin In aU their phases. In the inunedlate reaction, our leading statesmen staged a vociferous chorus of ignorance and Innocence. The President of tbe United States, unaware that he had approved the bUI 11 months before, wrote to his friend. Cowdry. on October 3, 1873: " I wonder whv silver is not already coming into the market to supply the deficiency in the circulating medium — silver will gradu- •Uy Uke tbe place at currency, and. further, wlU become the standard of values, which will be boarded in a smaU way." James G. Blaine, James A. Garfield, and a host of leaser person- ages, sadly confessed their Ignorance of the contents of the law that they had unwittingly enacted. Yet. from that day to this, the Act of 1873 has remained on the statute boolu. The veto of tbe Remonetlzation Act of 1878 by President Hayes stUl stands, albeit the great majority of tliat generation and of every succeed- ing one has favored the return to the law of Jefferson and Hamilton. In 1878 and again in 1890. Congress, over the protests of bi- metallism, changed our monetary system by substituting com- pulsory for free coinage of silver. Whatever their object, the result reduced sliver to a mere market commodity, carrying the burden of a constantly diminishing commercial value until in 1896 it was finally condemned and degraded to a cheap and de- spised mass of Junk. Outside of the United States 1^ became, and has remained, the outoast of the economic world. Since 1873 all obligations are payable In gold or Its equivalent, albeit the standard has been abandoned and denied contact with the mass of mankind. During this long interval nation after nation has perforce ac- cepted gold as a measure of all things material, especially national obligations, whether issued by silver or gold standard countries Yet we have confronted ever since 1816 the obvious truth that sliver Is the money medium of all peoples, whatever their nation- alities or destiny; It circulates, perforce, along and does the finan- cial work of three fourths of the globe. Its purchasing power has fallen from par at 16 and 15<4 to 1 down to the merest fraction of the ratio. It functions because nothing else can function. Its resurrection and vindication can neither be avolfled nor much longer be postponed. Yet the public creditor, the politician, what- ever his calling, the national political organizations, however otherwise divided, many of the world's leading economists, the financial thinker, even the apostles of the " brain trust " persist In their persistent and unvarying worship of the golden calf of modem finance. And I deliberately charge that ever since the act of 1873 was Ignorantly approved by a well-meaning President their Influence has been continually enlisted In a crusade of gold monometallism. that every statute designed for the public well-being, or at all affecting that standard, has either been disregarded, misconstrued, or misinterpreted and then made to defeat Its ends In the Interest of the system. Beginning with Secretary Sherman in 1877, and continuing with Woodin, Just retired, every Secretary of the Treasury, every as- sistant, every deputy, every Comptroller of the Currency, every member of the Federal Reserve Board, of the new Reconstruction Finance Corporation, and of the other financial organizations of the day, has been a militant opponent of bimetallism. There may be. somewhere along the line, some freak who is an exception, but If so, the fact Itself is lost to the records of history. From the day of silver's demonetization down to this hour, silver coinage has been Identified by Its opponents with currency Infla- tion. The charges have long been coequlvalent. Republicans of 1896 hurled the slander at every man and woman opposing Mc- Klnley, and have echoed it ever since. Yet. no more unfounded and malignant falsehood was ever devised against an honest citizenry. You may say anything else against bimetallism except that. Indeed, bimetallism Is the one absolute and Implacable ioe of Inflation In the monetary world. The charge was never thought of, much less pronounced, before the days of the gold standard. There Is only so much silver and so much gold on earth. They can only increase through production, and the law of their relative expansion Is an unchangeable fact of nat\ire. Were every ounce of silver c(Hned by the mints, It would only result In more basic circulation. The bullion would simply be transmuted into coin. It would be like manna to a starving world. The world's stock of sliver was officially stated at 10,013,341,290 fine ounces down to 1931. Were this aggregate sum available for mintage. It would, at fl.29 the ounce, realize •12,915.819.264; cal- culating the world's population at 1.500,000.000. the per capita dis- tribution of this amount of coin would give every individual only $8.60. The total sum of silver available for added Oklntage Is. at course, a mere fraction of the world's stock, the far greater propor- tion of which has long boen in circulation. An old student of money a century ago happily defined the bimetallic system as reciprocal. Any redundsmee of either metal adjusted itself automatically. He compared the movement of the circulation to two reservoirs communicating with each other by undnground pipes, so that the leakage - exorable logic of nature and experience. As early as 1871, Emest Seyd. one of the greatest economists in history, said: " It is a great mistake to suppose that the deflation of the gold values, besides England, will be beneficial. It would only lead to the destruction of the monetary equilibrium hitherto existing, and a decline in prosperity all over the world." This I consider the greatest and profoundest forecast of history. A brief reference to the fiscal history of India during the last 40 years Is sufficient to demonstrate the fact. A great country, long subject to forelg^n domination, has proven immune to laws designed to transform Its monetary system, by the mandate of Britain. In 1897 the Indian mints were closed over night, to the further coinage of silver. Tbe market value of silver bullion shrank within 48 hours to one half of its previous price, pro- ducing the consequent universal disaatcrs of panic and bank- ruptcy. Mr. Cleveland demanded, and was granted, immediate cessation of coinage bera, and Itagland. by act of Parliament promptly decreed tbe extension of tbe gold standard over India 72 CONGRESSIONAL in 1900. Trt. the rvp** per.lflt«d In lU '^l''^*"^- *?*^iu?Ju ?nd1mpo«1Slen practice. It al»o decreed the ^ertructlon erf th ri^o*L fnd the dumping of lU resultant bullion on the world i ma^rket^ Here tiu Confronted certain failure. If Papereub. rtftut^for the niee have been rejected In toto by the peop Seanrhl e Britain herself has been compelled to abandon Ui nVrlfn., «^ndard It la to be hoped, for all time. Her exampls S«.''Srfo^ce Sen imitated by ?Sually the ret ol the lUngU- "' The^oe^Srtence of silver as a measure of value, has accoffl pamed rveJ^'torW movement designed for the -tlmulatlon of e> Changes and extension of the world's purchasing Pf *"■ /gf ^° »" ^ again mankind ha* rewrted to lU Increasing use in »Ptt« of bltur opposuion. under the increasing pressure of public opinion The tremendous shrinkage of legal-tender money co?»«er appeal RECORD— SENATE January 4 to w«xe ad- All nominations received today will automaticaUy go the appropriate committees unless there is objection. Mr, HARRISON. I desire to ask unanimous consent, as In executive session, that I may report favorably from the Committee on Finance the nomination of Henry Morgenthau to be Secretary of the Treasury. I may say in that connec- tion that the nomination will go to the calendar. The VICE PRESIDENT. Is there objection? Mr McNARY. Mr. President, heretofore I have expressed my disapproval of such practice. I think every nomination, however important the position involved may be. should fol- low the rule and go to the appropriate committee and be reported back. There may be some objection to Mr. Mor- genthau There has been some objection expressed here. Mr. ROBINSON of Arkansas. Mr. President. wUl the Senator permit me? , . , Mr McNARY. I will listen to the Senator from Arkansas. Mr. ROBINSON of Arkansas. The custom has been to confirm the nominations of Cabinet members without refer- ence to committees unless a special request was made that a particular nomination should go to the appropriate com- mittee. The resolution which has been agreed to merely provides for the reference to committees of all nominations. Mr. McNARY. I was just reciting, as a general observa- tion, that last year the Senator from Arkansas and the Senator from Oregon agreed upon a plan whereby all nomi- nations would go to the appropriate committees. Here is an individual nomination, standing by itself, against which I have heard complaint made upon the floor of the Senate. I have no objection to the nomination, but I am trying to protect those who are not prepared at this time to state their position. Why should there be such haste? Why not let the nomination take the usual course? Mr. HARRISON. May I say to the Senator that, in this instance, the nomination is that of a Cabinet officer Mr. McNARY. I understand that Mr, HARRISON. And some of us have thought that the President of the United States was entitled to have the members of his own official family appointed and confirmed quickly; but I am not making the request that the nomina- tion be now considered by the Senate. The Committee on Finance this morning met with a very full attendance— I think there were only two members absent — and they unani- mously directed me to report the nomination favorably to the Senate. It will go on the calendar. I shall not insist upon taking it up today. Mr. McNARY. I do not object to the Senator reporting the nomination for the calendar. I thought he was asking for its consideration at this time. Mr. HARRISON. 1 did not make that request. Mr. McNARY. I make no objection to the nomination being reported. The VICE PRESIDENT. Without objection, the report will be received, and the nomination will go to the calendar. SECRET.\RY OF THE TREASURY Mr. LONG. Mr. President, as a matter of personal privi- lege, by reason of some publicity that has been given to the confirmation of the nomination of Mr. Morgenthau as Secretary of the Treasury I want to make a brief statement. There were handed to me several newspaper reports con- taining some statements Mr. Morgenthau has made with regard to settlements pending in the Internal Revenue Bu- reau which, as I understand the law. were irregular and I think more or less unwise. Some other matters were in- cluded in the statements handed to me. While the exam- ination of Mr. Morgenthau was in executive session I think I may say that Mr. Morgenthau admitted having made the statements. Mr. CONNALLY. Mr. President, if the statements were made in executive session why should the Senator disclose them? Mr. LONG. T think the Senator will not object to the disclosure. Mr. CONNALLY. I am objecting, though. I was in the executive session with the Senator and heard the state- 1934 CONGRESSIONAL RECORD— SENATE 7S ments. and I am objecting to their disclosure. The Senator should not rise on the flr ir of the Senate and disclose what took place La executive session. Mr. LONG. Very well. I will get at it in this way with- out stating that it was in executive session. Mr. Morgen- thau does not deny having made the statements. There is some disagreement among Senators as to whether or not what he did is, technically speaking, a violation of the terms of the statute. Personally I think it is irregular, but none the less the disclosures that Mr. Morgenthau made in the papers and such contact as I have had with the gentleman since that time convince me that the irregulari- ties were with intent to favor the public rather than to do it injury, so I am not making any objection to con- firmation of his nomination. Mr. HARRISON. Mr. President. I am very glad the Sen- ator from Louisiana is not going to make objection to con- flrmatio.Ti of the nomination of Mr. Morgenthau. May I say with reference to one remark the Senator made that there may be some difference of opinion among members of the committee as to whether or not Mr. Morgenthau violated any law in making certain statements. I cannot permit that statement to pass unnoticed, because I think there was not very much difference of opinion among the members of the committee with reference to that point. I believe I have never seen any man appear before a com- mittee who made a finer impression on the membership of the committee than did the Secretary of the Treasury, Mr. Morgenthau. The vote was unanimous in favor of his confirmation. Mr. LONG. Permit me to make just this further state- ment. I do not say the gentleman particularly violated the law. I think at least what the Secretary of the Treasury did was outside the law. If I myself had been a member of the committee I would not have opposed the confirmation. I think the statements he made were very unwise. All gf us young men live to learn, and I think the Secretary of the Treasury will profit by this experience and probably will not do such a thing again. ORDER FOR ADJOURNMENT TO MONDAY Mr. ROBINSON of Arkansas. Mr. President, I ask unan- imous consent that when the Senate concludes its business today it adjourn until Monday next at 12 o'clock meridian. The VICE PRESIDENT. Is there objection? The Chair hears none and it is so ordered. DEATH OF REPRESENT ATITE EDWARD B. ALMON, OF ALABAMA The VICE PRESIDENT. The Chair lays before the Sen- ate resolutions cotning over from the House of Representa- tives, which will be read. The Chief Clerk read the resolutions (H.J .Res. 203), as follows : Resolved. That the House has heard with profoxind sorrow of the death of Hon. Edwjuid B. Almon, a Representative from the State of Alabama. Resolved, That the Clerk communicate these resolutions to the Senate an4 transmit a copy thereof to the famUy of the deceased. Mr. BLACK. Mr. President, I send resolutions to the desk and ask for unanimous consent for their present con- sideration. The resolutions (SJles. 114) were read, considered by unanimous consent, and unanimously agreed to, as follows: Senate Resolution 114 Resolved, That the Senate has heard with profound sorrow the annoiuicement of the death of Hon. Eowabo B. Ajlmon, late a Representative from the State of Alabama. Resolved, That the Secretary communicate these resolutions to the House of Representatives and transmit a copy thereof to the family of the deceased. DEATH OF aEPRESENTATIVB JAMES 6. PARKER, OF NEW YORK The VICE PRESIDENT. The Chair lays before the Sen- ate House Resolution 204, which will be read. The Chief Clerk read the resolution (H.Rcs. 204), as follows : Retolved, That the Hoxue has beard with profouiKl sorrow of the death of Hon. James S. Paekeb, a Representative from the State of New York. A«joto0tf, That th« Ctork eommQnle*t« these rc«oluUona to th« Senate and transmit a copy thereof to the famUy of tha dacaaaed. Mr. COPELAND. Mr. President, it is with extreme per- sonal and official regret that I learned of the death of Mr. Parker. I ask for the adoption of the resolutions which I now seiul to the desk. The VICE PRESIDENT. The clerk will read the resolu- tions. The resolutions (SJles. 115) were read, considered by unanimous consent, and unanimously agreed to, as follows: Senate Reaolutlon 115 Resolved. That the Senate haa heard with profound aorrow tha announcement of the death of Hon. Jambs S. Famkxm, late a Rep- resentative from the State of New York. Restdved. That the Secretary communicate these resolutions to the House of Representatives and transmit a copy thereof to iho family of the deceased. <* DEATH OF REPRESENTATIVE LYNN 8. HOBNOR. OF WEST TItOZNIA The VICE PRESIDENT. The Chair lays before the Sen- ate resolutions coming over from the House of Representa- tives, which will be read. The Chief Clerk read as follows: Re9olved, That the House has heard with profotmd sorrow of the death of Hon. Ltnn S. Hoknob, a Representative from the State of West Virginia. Jlesolved, That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. Mr. NEELY. I ask unanimous consent for the immediate consideration of the resolutions which I send to the desk. The VICE PRESIDENT. Let the resolutions be read. The resolutions (S.Res. 116) were read, considered by unanimous consent, and unanimously agreed to, as follows: Resolved, That the Senate has heard with profound sorrow the announcement of the death of Hon. Ltnn S. Horwoe, late a Rep- resentative from the State of West Virginia. Resolved, That the Secretary communicate these resolutions to the House of Representatives and transmit a copy thereof to the family of the deceased. DEATH OF REPRESENTATIVE JOHN D. CLARKE, OF NEW YORK The VICE PRESIDENT. The Chair lays before the Sen- ate resolutions coming over from the House of Representa- tives, which will be read. The Chief Clerk read the resolutions (HJlcs. 207). as follows: Resolved. That the House has heard with profound sorrow of the death of Hon. John D. Clarks, a RepresMitatlve from the State of New York. Resolved, That the Clerk communicate these resolutions to the Senate and transmit a copy thereof to the family of the deceased. Mr. WAGNER. Mr. President, I ask unanimous consent for the immediate consideration of the resolutions which I send to the desk. The VICE PRESIDENT. Let the resolutions be read. The resolutions (SJies. 117) were read, considered by unanimous consent, and unanimously agreed to, as follows: Resolved. That the Senate has heard with profound sorrow the announcement of the death of Hon. John D. Clabks, late a Repre- sentative from the State of New York. Resolved, That the Secretary cooununlcate these resolutions to the House of Representatives and transmit a cc^y thereof to the family of the deceased. DEATH OF REPRESENTATIVE HENXY W. WATSON, OF PENNSYLVANIA The VICE PRESIDENT. The Chair lays before the Senate resolutions cmning over from the House of Repre- sentatives, which will be read. The Chief Clerk read the resolutions (HJles. 208), as follows: Resolved. That the Houae haa beard with profound aorrow of the death of Hon. Henst W. Watson, a Representative fr<»n the State of Pennsylvania. Resolved, That the Clerk communicate these resolutlona to the Senate and transmit a copy thereof to the family of the deceased. Mr. REED. Mr. President, I learned with deep regret of the death of Representative Watson. I now send to the desk resolutions and ask unanimous consent for their consid- eration and adoption. The VICE PRESIDENT. The resolutions will be read. rw.nvpr Colo in place of xnomas i. wiiiun. i MargaS M McQuilkin. of Salt Lake City. Utah, to ^^ coUector of customs for customs collection district no. ^ 8 with headquarters at Salt Lake City. Utah, in place af ipnnie P Musser. resigned. . ^ * AU e J Angle, of Florida, to be collector of customs for customs coUection district no. 18. with headquarters at Tampa Fla.. in place of Sidney C. Brown, resigned. Ralph W. Wescott. of Haddonfield. N.J.. to be comptroller of customs in customs coUection district no 11. with head- quarters at Philadelphia. Pa., in place of Collins B Allen William H Bartley. of Montana, to be coUector of customs for customs coUection district no. 33. with headquarters at Great Falls. Mont., in place of Charles L. Sheridaii. Adrian Pool, of El Paso. Tex., to be collector of custons for customs coUection district no. 24. with headquarters at El Paso. Tex., in place of Manuel B. Otero, resigned. James T Travers. of Duluth. Minn., to be collector of customs for customs coUection district no. 36. with head- quarters at Duluth. Minn., in place of Curtis M. Johnson. S Scott Beck, of Chestertown. Md.. to be comptroller of customs in customs coUection district no. 13, with head- quarters at Baltimore. Md.. in place of Lawrence B. Towers. Samuel T. Ladd. of Portsmouth. NH., to be comptro ler of customs for customs coUection district no. 4. with hei id- quarters at Boston. Mass.. in place of Dwight HaU. resigred. Henry V. Schwalbach. of MUwaukee. Wis., to be coUector of customs for customs coUection district no. 37. with hefid- quarters at MUwaukee, Wis., in place of Walter J. Wilde. 1 Agnes M Hodge, of Minneapolis. Minn., to be coUectoi of customs for customs coUection district no. 35. with head- quarters at Minneapolis. Minn., in place of Carl Eastwassed assistant surgeon, to rank as such from July 1, 1933. Chief Pharmacist Benjamin E. Holsendorf to be passed assistant pharmacist, to rank as such from December 16. 1933. Surg. Lon OUver Weldon to be senior surgeon, to rank as such from September 16. 1933. Surg. Howard FrankUn Smith to be senior surgeon, to rank as such from September 18. 1933. Surg. James Gayley Townsend to be senior surgeon, to rank as such from December 6, 1933. Surg. WilUam Howard Slaughter to be senior surgeon, to rank as such from December 9, 1933. Surg. Joseph Bolten to be senior surgeon, to rank as such from July 26. 1933. Passed Asst. Surg. LeGrand B. Byington to be surgeon, to rank as such from October 15. 1933. AppoiNTMEirrs m thx Regular Aurr To be major generals Brig. Gren. Harold Benjamin Rske, United States Army, from August 1, 1933, vice Maj. Gen. CampbeU King. United States Army, retired July 31, 1933. Brig. Gen. Halstead Dorey, United States Army, from November 1, 1933, vice Maj. Gen. Edwin B. Winans. United States Army, retired October 31. 1933. To be brigadier generals Col. George Vidmer. Cavalry, from August 21. 1933, vice Brig. Gen. Harold B. Fiske, United States Army, accepted appointment^ major general, August 21. 1933. Col. Thomas^mery Merrill, Field ArtiUery, from October 1, 1933. vice »rig. Gen. Meriwether L. Walker, United States Army, retired September 30. 1933. Col. Alexander Thompson Ovenshlne. Infantry, from No- vember 1. 1933, vice Brig. Qen. Halstead Dorey, United States Army, accepted appointment as major general. No- vember 1, 1933. Col, WiUiam Keith Naylor, Infantry, from December 1. 1933, vice Brig. Gen. Joseph C. Castner, United States Army, retired November 30, 1933. Col. Robert Osbom Van Horn, Infantry, from December 1, 1933, vice Brig. Gen. George H. Jamerson. United States Army, retired November 30, 1933. 1 CONGRESSIONAL RECORD— SENATE 78 To be Judge Advocate General with the rank of major H eral. for the period of 4 years beginning December 1. 193 \. vyith rank from December 1, 1933 Col Arthur Winton Brown. Judge Advocate General's I>^ partment. vice Maj. Gen. Blanton Winship. Judge Advoca e General, retired November 30. 1933. To be Chief of Engineers, with the rank of "»«;^^ Jf^' J, for the period of 4 years beginning October 18. 1933. mih rank from October 1. 1933 Col Edward Murphy Markham. Corps of Engineers, viie Maj. Gen. Lytle Brown. Chief of Engineers, whose term )f offlce expired September 30, 1933. To be Assistant to the Quartermaster General, with the rank of brigadier general, for the period of 4 years, begin ni ij; October 18. 1933. unth rank from September 19. 1933 Col Patrick William Guiney, Quartermaster Corps, vice Brig. Gen. Louis H. Bash. Assistant to the Quartermasl er General, whose term of office expired September 18, 1933, To be Chief of Chaplains, with the rank of colonel, for the period of 4 years beginning December 23, 1933, with rank from Dectmber 23. 1933 Chaplain Alva Jennings Brasted (Ueutenant colon^). United SUtes Army, vice Chaplain Julian E. Yates (colonel) . Chief of Chaplains, whose term of office expired Dece|n ber 22. 1933. nfTAWTUT To be second lieutenant vnth rank from July IS. 1933 Adrian Leonard Hoebeke. graduate. United SUtes Military Academy, class of 1933. MEDICAL CORPS To be first lieutenants with rank from July 1. 1933 First Lt. Roger Hubbard Allbee. Medical Corps Reservt First U. Urho Robert Merikangas, Medical Corps Reseive. First Lt. John Bernard Herman, Medical Corps Reserv< First Lt. Clifford Gordon Blitch, Medical Corps Reserve First Lt. Max Naimark, Medical Corps Reserve. First Lt. Vernon James Erkenbeck. Medical Corps Resei ve First Lt. Arthur Herbert Thompson. Medical Corps Resei ye. First Lt. Wilson Theodore Smith. Medical Corps Resei ^e First Lt. Clarendon Barron Woods. Medical Corps Resei -ve First Lt. Joe Alexander Bain. Medical Corps Reserve. First Lt. Cecil Spencer Mollohan. Medical Corps Rese-ve. First Lt. Francis Whitney Hall, Medical Corps Reserve First Lt. Joseph Sibley Cirlot, Medical Corps Reserve. First Lt. Richard Howard Eckhardt. Medical Corps tie serve. First Lt. John Mars Caldv'ell. Jr.. Medical Corps Rese-ve First Lt. Charles Parmalee Ward. Medical Corps Reserve First Lt. Elmer Arthur Lodmell, Medical Corps R,eserv^ First Lt. Lester Paul Veigel. Medical Corps Reserve. First Lt. George Lewis Beatty. Medical Corps Reserve. First Lt. Harold Inin Amory. Medical Corps Reserve. First Lt. John Albert Egan. Medical Corps Reserve. First Lt. George Gustavo Guiteras. Medical Corps Res^e First Lt. Edgar Louis Alson. Medical Corps Reserve. To be first lieutenant unth rank from July 5. 1933 First Lt. Robert Purcell Rea. Medical Corps Reserve. To be first lieutenant unth rank from July 10. 1933 First Lt. Aithur Eugene White. Medical Corps Rserve. To be first lieutenant with rank from July 29. 1933 First Lt. Frank Anthony Minas. Medical Corps Resen^. To be first lieutenant unth rank from August 1, 1933 First Lt. Henry Schuldt Murphey. Medical Corps Reside To be first lieutenant with rank from August 26. 193, First Lt. Carl Robert Darnall, Medical Corps Reserve. To be first lieutenants unth rank from September 1.19' First Lt. George Merle Powell. Medical Corps Reserve First Lt. Clesson Beckwith. Medical Corps Reserve. First Lt. Charles Henry Morhouse. Medical Corps Res< rve. January 4 1934 CONGRESSIONAL RECORD— SENATE 79 To be first Ueutenant with rank from September 11. 1933 First Lt. John Lemoin Crawford. Medical Corps Reserve. DENTAL CORPS To be first lieutenant with rank from October 1. 1933 First Lt. WiUiam Thomas Williams, Dental Corps Reserve. VETERINARY CORPS To be second lieutenants with rank from July 1. 1933 Second Lt. Wayne Otho Kester. Veterinary Corps Reserve. sSoSd Lt. Robert Arthur Boyce, Jr.. Veterinary Corps ^l^^nd Lt. Clarence Leonard Taylor. Veterinary Corps BtEDIC.AL ADMINISTRATIVE CORPS To be second lieutenants with rank from July 1. 1933 Technical Sgt. Carrol Conrad Barrick. Medical Depart- "^?TOhnical Sgt. Thomas Raymond Jones, Medical Depart- ""sUff Sgt. Cornelius John Curran. Medical Department. Staff Sgt. Gerard Adrien Belanger. Medical Department. Staff Sgt. Guy Wycoff Harlow, Medical Department. CHAPLAINS To be chaplains with the rank of first lieutenant First Lt. Elmer Emil Tiedt, Chaplains' Reserve, with rank ''^^st Lt. 'Stanislaus Joseph Ryczek. Chaplains' Reserve, with rank from September 28. 1933. , , , „ ... First Lt. John Edward Duffy. Chaplains' Reserve, with rank from November 6. 1933. Afpointmxnts. by Transfer, in the Regular Army TO quartermaster corps Maj Irving Howard Engleman. Infantry (assigned to duty with Quartermaster Corps). July 14. 1933, with rank from October 17. 1927. , , . ^ _* Capt. Wannie Lee Bartley. Infantry (detailed in Quarter- master Corps). October 6. 1933, with rank from July 1, 1920 Capt. Clarence Walter Richmond. Cavalry (detaUed in Quartermaster Corps). October 11, 1933. with rank from July 1. 1920. ^ , ^.„ Second Lt. William Arthur Davis. Jr., Coast Artillery Corps (detailed in Quartermaster Corps). August 15, 1933, with rank from June 11. 1931. Second Lt. Merwin Scott Dickson. Coast Artillery Corps (detailed in Quartermaster Corps), August 15, 1933, with rank from June 11, 1931. TO ORDNANCE DEPARTMENT First Lt. Edward Pont Mechling. Cavalry (detailed in Ord- nance Department), with rank from March 1. 1933. Second Lt. Charles Ralph Pinkerton, Cavalry (detailed in Ordnance Department) , August 1, 1933, with rank from June 9. 1928. TO FIELD ARTILLERY Second Lt. Gerald Lorenzo Roberson, Infantry. July 17, 1933. with rank from June 13. 1933. TO COAST ARTILLERY CORPS Second Lt. Roy Kay Kauffman. Infantry, September 18, 1933, with rank from June 11, 1931. TO INFANTRY Col. Frederick William Coleman. Finance Department (Major General, Chief of Finance), December 7, 1933, with rank from April 27, 1921. First Lt. Charles Vernon Barnum, Cavalry, December 7, 1933. with rank from July 1, 1920. TO AIR CORPS Second Lt. Charles Hardin Anderson. Cavalry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. John Edwin Barr, Field Artillery (detailed in Air Corps) , July 14, 1933, with rank from June 11, 1931. Second Lt. Bsrram Arnold Bunch, Cavalry (detailed in Air Corps), with rank from June 10. 1932. Second Lt. Paul Delmont Bunker, Jr.. Infantry (detailed in Air Corps) . with rank from June 10, 1932. Second Lt. Daniel Stone Campbell, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. George Dowery Campbell. Jr.. Field Artillery (detailed in Air Corps), with rank from June 10. 1932. Second Lt. Robert Lynn Carver, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. James Hutchings (Cunningham, Jr., Coast Artillery Corps (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Leo Peter Dahl, Coast Artillery Corps (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. Thomas Connell Darcy. Infantry (detailed in Air Corps), with rank from June 10. 1932. Second Lt. William Madison Garland. Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. James Walter Gurr, Infantry (detailed In Air Corps) , with rank from June 10, 1932. Second Lt. Donald Linwood Hardy. Coast Artillery Corps (detailed in Air Corps) . with rank from June 10, 1932. Second Lt, Hunter Harris. Jr., Infantry (detailed in Air Corps) , with rank from June 10. 1932. Second Lt. Loren Boyd HiUsinger, Field Artillery (de- tailed in Air Corps) , with rank from June 10, 1932. Second Lt. Kenneth Burton Hobson, Infantry (detailed In Air Corps) , with rank from June 10. 1932. Second Lt. Frank Lester Howard. Field Artillery (detailed in Air Corps) , with rank from June 10. 1932. Second Lt. Harvey Porter Huglin. Field Artillery (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Frank Greenleaf Jamison, Infantry (detailed in Air Corps), with rank from June 10. 1932. Second Lt. Joe William Kelly. Infantry (detailed in Air Corps) , with rank from June 10. 1932. Second Lt. David Hamilton Kennedy. Field Artillery (de- tailed in Air Corps), with rank from June 10, 1932. Second Lt. John Paul McConnell. Field Artillery (detailed In Air Corps), with rank from June 10, 1932. Second Lt. Andrew Meulenberg, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. Thomas Charles Morgan, Infantry (detailed In Air Corps), with rank from June 10, 1932. Second Lt. Eugene Porter Mussett, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. Nicholas Earnest Powel, Infantry (detailed in Air Corps) . with rank from June 10, 1932. Second Lt. Romulus Wright Puryear, Infantry (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Clifford Harcourt Rees, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. Robert Lee Scott, Jr., Infantry (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Edwin Guldlin Simenson, Field Artillery (de- tailed in Air Corps) , with rank from June 10, 1932. Second Lt. Ray James Stecker, Field Artillery (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Stanley Ronald Stewart, Coast Artillery Corps (detailed in Air Corps), with rank from June 10, 1932. Second Lt. Edward Willis Suarez. Infantry (detailed in Air Corps) . with rank from June 10. 1932. Second Lt. John Reynolds Sutherland. Cavalry (detailed In Air Corps) , with rank from June 10. 1932. Second Lt. Robert Haynes Terrill, Infantry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. James Forsyth Thompson, Jr., Field Artillery (detailed in Air Corps), with rank from June 10. 1932. Second Lt. Benjamin Jejjson Webster, Coast Artillery Corps (detailed in Air Corps) , with rank from Jime 10, 1932. Second Lt. Sam Houston Wiseman, Cavalry (detailed in Air Corps) , with rank from June 10, 1932. Second Lt. Torgils Grimkel Wold. Coast Artillery Corps (detailed in Air Corps), with rank from June 10. 1932. Second Lt. Joseph Buford Zimmerman, Field Artillery (de- tailed in Air Corps) , July 14. 1933, with rank from June 11, 1931. Promotions in the Rcgular Army To be colonels Lt. Col. Royden Eugene Beebe. Infantry, from July 1. 1933. Lt. Col. Edward Appleton Keyes, Cavalry, from July 1, 1933. Lt. Col. William James OTiOUghlin, Infantry, from July 1. , 1933. Lt. Col. Herbert Edward Mann, Cavalry, from July 1, 1933. Lt. Col. Francis Augustus Ruggles. Field Artillery, from August 1. 1933. Lt. Col. Henry Tilghman Bull. Cavalry, from August 1, 1933. Lt. Col. Howard Russell Smalley, C?avalry. from August 10, 1933. Lt. Col. John Scott, Infantry, from August 21, 1933. Lt. Col. Noble James Wiley, Infantry, from August 32, 1933. Lt. Col. CSeorge Catlett Marshall, Infantry, from Septem- ber 1. 1933. Lt. Col. Talbot Smith. Cavalry, from September 1, 1933. Lt. Col. Frank Edwin Davis, Quartermaster Corps, from September 1. 1933. Lt. Col. William Wallace Overton, Cavalry, from October 1, 1933. Lt. Col. Samuel Turner Mackall, Infantry, from October 1, 1933. Lt. Col. Walter Campbell Short. Infantry, from October 1, 1933. Lt. Col. Frank Fanning Jewett, Infantry, from October 1, 1933. Lt. Col. Augustus Francis Dannemiller, Infantry, from October 17. 1933. Lt. Col. Alfred Asa Hickox, Infantry, from October 27. 1933. Lt. Col. Samuel Greaner Talbott, Adjutant General's De- partment, from November 1. 1933. Lt. Col. Charles Macon Wesson, (^dnance Department, from November 1, 1933. Lt. Col. Glen Fay Jenks, Ordnance Department, from No- vember 1, 1933. Lt. Col. Clarence Beaumont Ross, Coast Artillery Corps, from November 1. 1933. Lt. Col. Richard Henry Jordan, Quartermaster Corps, from Noveml)er 1. 1933. Lt. Col. William Storrs Bowen, Coast Artillery Corps, from November 1. 1933. Lt. Col. William Fitzhugh Jones. Quartermaster Corps, from November 1, 1933. Lt. Col. Brainerd Taylor, Quartermaster Corps, from No- vember 1. 1933. Lt. Col. Emmet Roland Harris, Finance Department, from November 1, 1933. Lt. Col. Avery John Cooper, C!oast Artillery Corps, from November 1, 1933, Lt. CoL Frank Geere, Coast Artillery C^rps, from Decem- ber 1, 1933. Lt. Col. George Leftwich Wertenbaker, Coast Artillery Corps, from December 1, 1933. Lt. Col. Walter Campbell Baker, Chemical Warfare Serv- ice, from December 1, 1933. Lt. Col. Richard Irving McKenney, C^oast Artillery Ccarps, from December 1, 1933. Lt. Col. Charles Albert Clark, Quartermaster Corps, from December 1, 1933. To be Ueutenant cotonels Maj. Louis Roberts Dougherty. Field Artillery, from July 1, 1933. Maj. Samuel Roland Hopkins, Field ArtiUery, from July 1. 1933. 9^^ CONGRESSIONAL RECORD— SENATE 1. 10, J 2. M. 80 Maj. Clarence Talmage Marsh. Coast Artillery Corps, from ''^Maj: JoS: Blackwell Maynard. Coast Artillery Corps, frojn ^^M&]'. Jacob Herman Rudolph. Air Corps, from August 1933 Maj Elbe Allen Lathrop. Infantry, from August 1. 1933. Maj! Raymond Ceward Baird. Infantry, from August 1Q33 I Maj. Arthur Griffith Campbell, Coast Artillery Corps, frc^ August 21. 1933. , . 4. Maj. Matthew Addison Palen. Infantry, from August 1933 Maj. Frederick LeRoy Martin. Air Corps, from August 1933 T-L Maj. Elza Charles Johnson. Judge Advocate General's Ee- partment. from September 1. 1933. Maj. Prank CorneUus Reilly. Adjutant Generals DepaJt- ment. from September 1. 1933. „ t^ „ .* Maj. Walter Dew Cline. Judge Advocate General s Depa t- ment. from September 1, 1933. Maj. Henry Lawson Rice, Ordnance Department, frim September 1. 1933. , „ . * Maj. Harry Montague Trippe. Corps of Engmeers. from September 1. 1933. Maj. John Soule BuUer. Corps of Engmeers. from Sep- tember 1. 1933. ^ ^ , Maj. Charles Mason Roberts. Ordnance Department, fr3m September 1. 1933. , ,„„ Maj. William Buerkle. Infantry, from October 1. 1933. Maj. Fredrick Clifford Rogers, Infantry, from Octobei 1. 1933 Maj. Robert aifton Garrett. Coast Artillery Corps, from October 1. 1933. ^ ^ * »_ , Maj. Burton Ebenezer Bowen. Infantry, from Octobei 1, • 1933. Maj. Robert Ross Welshmer. Coast Artillery Corps, fijom October 1, 1933. Maj. Otto Harry Schrader. Coast Artillery Corps, fiom October 17. 1933. Maj. Robert Elton Guthrie, Coast Artillery Corps, fiom October 27. 1933. Maj. William Robert Nichols. Coast Artillery Corps, from November 1. 1933. Maj. Paul Henry Herman, Coast Artillery Corps, from November 1. 1933. Maj. Oscar Czar Warner. Coast Artillery Corps, from ^o- vember 1. 1933. Maj. Prank Sheldon Clark. Coast Artillery Corps, f:om November 1, 1933. Maj. Kelley Benjamin Lemmon, Coast Artillery Corps, from November 1. 1933. Maj. William Skinner Pulton. Coast Artillery Corps, from November 1. 1933. Maj. Thomas Ogden Humirfireys, Coast Artillery Ccrps, from November 1. 1933. Maj. Donald MacQueen Ashbridge. Coast Artillery Ccrps. from November 1. 1933. Maj. Hollis LeRoy Muller. Coast Artillery Corps, from November 1. 1933. Maj. Ell Elmer Bennett. Coast Artillery Corps, from No- vember 1. 1933. Maj. William McClea^e, Field Artillery, from Novembsr 1, 1933. Maj. Stuart Chapin Godfrey, Corps of Engineers, ^om November 1, 1933 rom law. January 4 Maj. Francis Clark Hjurington. Corps of Engineers. November 1, 1933. subject to examination required by Maj. Cleveland C. Ge<;. Corps of Engineers, from De<|em ber 1, 1933. Maj. John Roy Douglas Matheson, Corps of Engin^rs. from December 1. 1933. Maj. Charles Joel Taylor. Corps of Engineers, from De cember 1. 1933. Maj. Edwin Hall Marks. Corps of Engineers, from De^m ber 1. 1933. Maj. Earl North, Corps of Engineers, from December 1. 1933 Maj. Gilbert Van Buren Wilkes. Corps of Engineers, from ^a?. JohA Clifford Hodges Lee. Corps of Engineers, from ^'j'.^Frlnk^&ihaffer Besson. Corps of Engineers, from December 4, 1933. To be majors Capt. Joseph Clark Addington. Infantry, from May 24. 1933 Capt. Allison Joseph Barnett. Infantry, from June 1 1933. Capt. Harrison Mortimer DufflU. Quartermaster Corps. from June 1. 1933. * ^ „ #,„-„ Capt. Thomas Leroy Holland. Quartermaster Corps, from "^"capt. John Andrew Porter. Quartermaster Corps, from June 1, 1933. . „ * _ Capt. Herbert Lee Kidwell, Quartermaster Corps, from June 24, 1933. Capt. George Frederick Unmacht, Chemical Warfare Serv- ice, from July 1, 1933. , i i moo Capt. John Graham Colgan, Air Corps, from July 1. 1933. Capt. George Pollock Bush. Signal Corps, from July 1. 1933 Capt. Thomas Jefiferson McGrath. Quartermaster Corps. from July 1. 1933. Capt. Thomas Otis Baker. Quartermaster Corps, from July 1. 1933. ^ ^ , Capt. George Henry Hahn. Quartermaster Corps, from July 1. 1933. ^ - Capt. John North Douglas, Quartermaster Corps, from July 9, 1933. ^ , Capt. William Settle Evans, Field Artillery, from August 1 1933. Capt. Alonzo Lincoln LitteU. Quartermaster Corps, from August 1. 1933. ^ ^ , . Capt. Clarence Longacre, Quartermaster Corps, from Au- gust 1. 1933. Capt. Percival Simon Holmes, Quartermaster Corps, from August 1, 1933. Capt. Clarence Lloyd Middleton, Quartermaster Corps, from August 7. 1933. Capt. George Herbert Schumacher, Quartermaster Corps, from August 10. 1933. Capt. Walter Moody Tenney. Field Artillery, from August 21 1933. Capt. Arthur Shelby Levinsohn, Quartermaster Corps, from August 22. 1933. Capt. Richard Bartholomew Moran. Signal Corps, from August 24, 1933. Capt. Arthur Oscar Walsh. Finance Department, from August 30. 1933. Capt. David McGoodwin Speed. Quartermaster Corps, from August 31. 1933. Capt. Harry Lauman Waggoner. Quartermaster Corps, from August 31. 1933. Capt. Joseph Dixon Hahn. Quartermaster Corps, from September 1. 1933. Capt. August Christian Jensen. Quartermaster Corps, from September 1, 1933. Capt. Walter Herbert Wells, Infantry, from September 1. 1933. Capt. James Benjamin Ettridge, Quartermaster Corps, from September 1, 1933. Capt. William Harvey Dukes, Quartermaster Corps, from September 1. 1933. Capt. Murray Benjamin Dilley. Signal Corps, from Sep- tember 1. 1933. Capt. LeRoy Lutes. Coast Artillery Corps, from September 1. 1933. Capt. Emil Herbert Block. Quartermaster Corps, from Sep- tember 1. 1933. Capt. Royal Granville Jenks, Finance Department, from September 1. 1933. 1934 CONGRESSIONAL RECORD— SENATE 81 Capt. William Cassidy. Quartermaster Corps, from Sep- tember 1. 1933. Capt. Richard TTiomas Edwards. Quartermaster Corps, from September 1. 1933. Capt. Alexander Effray Whitworth. Signal Corps, from September 11. 1933. Capt. David Andrew Watt, Adjutant General's Depart- ment, from September 26, 1933. Capt. Welcome Porter Waltz. Infantry, from October 1, 1933. Capt. John Walter Crissy. Infantry, from October 1, 1933. Capt. Edwin Hugh Johnson, Infantry, from October 1. 1933. Capt. Russel McKee Herrington. Corps of Engineers, from October 1. 1933. Capt. Leonard Smith Doten. Quartermaster Corps, from October 1. 1933. Capt. Lawrence Aloysius Quinn. Infantry, from October 1, 1933. Capt. Lewis Abram Pulling, Cavalry, from October 1. 1933. Capt. Dallas Royce Alfonte. Infantry, from October 1, 1933. Capt. Fred Matthew Fogie, Quartern »aster Corps, from Oc- tober 1, 1933. Capt. Guy Hudson Dosher, Field Artillery, from October 1, 1933. Capt. Charles Erwin Rayens, Infantry, from October 17, 1933. Capt. Chailes Hudson Jones. Infantry, from October 27. 1933. Capt. Sidney Feagin Dunn, Field Artillery, from November 1, 1933, Capt. William Hones, Infantry, from November 1, 1933. Capt. Albert Charles Chesledon, Coast Artillery Corps, from November 1, 1933. Capt. Breckinridge Atwater Day, Field Artillery, from No- vember 1, 1933. Capt. Joseph Kennedy, Field Artillery, from November 1, 1933. Capt. William Harold Joiner, Ordnance Department, from November 1, 1933. Capt. George David Shea. Field Artillery, from November 1, 1933. Capt. Philip Blaine Fryer, Cavalry, from November 1, 1933. Capt. Woodrow Wilson Woodbridge, Field Artillery, from November 1, 1933. Capt. Donald Coe Hawley, Cavalry, from November 1, 1933. Capt. Vernon Lhreau Padgett. Cavalry, from November 1. 1933. Capt. Gilmer Meriwether Bell. Infantry, from November 1. 1933. Capt. Roy Sloan, Infantry, from November 1, 1933. Capt. Jay Ward MacKelvie. Field Artillery, from November 1. 1933. Capt. Glenn Dewitt Huflord. Infantry, from November 1, 1933. Capt. Wilbur Clynton Carlan. Field Artillery, from No- "vember 1. 1933. Capt. Francis Truman Bonsteel, Cavalry, from November 1. 1933. Capt. Albert Alan Allen. Coast Artillery Corps, from No- vember 1. 1933. Capt. Paul Revere Hudson, Infantry, from November 1, 1933. Capt. William Edwin Barott, Cavalry, from December 1, 1933. Capt. Frank Nelson, Cavalry, from December 1, 1933. Capt. Herman Frederick Rathjen, Cavalry, from Decem- ber 1. 1933. Capt. George Ross Rede, Field Artillery, from Decem- ber 1. 1933. Capt. Ralph Hall. Infantry, from December 1, 1933. Capt. John Homer Carriker. Field Artillery, from Decem- ber 1. 1933. Capt. Benjamin Harrison Hensley, Infantry, from Decem- ber 1. 1933. Capt. Jerome Pickett, Infantry, from December 4, 1933. To be captains ^ First Lt. Clarence Lionel Adcock. Corps of Engineers, from May 24. 1933. First Lt. Keryn ap Rice, Corps of Engineers, from June 1. 1933. First Lt. Charles Stuart Ward. Corps of Engineers, from June 1. 1933. First Lt. Henry Morehead Underwood, Corps of Engineers, from June 1. 1933. First Lt. James Bryan Newman, Jr., Corps of Engineers, from June 1. 1933. First Lt. James Marshall Toung, Corps of Engineers, from June 1. 1933. First Lt. James Creel Marshall, Corps of Engineers, from Jime 1, 1933. First Lt. Walter Ernest Lorence, Corps of Engineers, from June 10. 1933. First Lt. Lucius DuBignon Clay, Corps of Engineers, from June 19. 1933. First Lt. Lloyd Ernst Mielenz, Corps of Engineers, from June 24, 1933. First Lt. Pierre Alexander Agnew, Corps of Engineers, from July 1, 1933. First Lt. Alexander Murray Neilson, Corps of Engineers, from July 1. 1933. First Lt. Hoel Smith Bishop, Jr., Corps of Engineers, from July 1, 1933. First Lt. Robert Habersham Elliott. Corps of Engineers, from July 1, 1933. First Lt. Samuel Davis Sturgis, Jr., Corps of Engineers, from July 1, 1933. First Lt. Thomas Hay Nixon, Ordnance Department, from July 1. 1933. First Lt. Anderson Thomas William Moore, Corps of Engineers, from July 1, 1933. First Lt. Reginald Whitaker, Corps of Engineers, from July 1, 1933. First Lt. Eugene Mead Caffey, Corps of Engineers, from July 1. 1933. First Lt. Henry Milton Alexander. Cavalry, from July 1, 1933. First Lt. James Milligan Gillespie, Air Corps, from July 9, 1933. First Lt. Milo Benson Barragan. Field Artillery, from July 18. 1933. First Lt. Paul Ludwig Deylitz, Ordnance Department, from August 1. 1933. ^ First Lt. Ernest William Gruhn, Infantry, from August 1, 1933. First Lt. Edwin Luther Sibert, Field Artillery, from August 1. 1933. First Lt. Joseph Stubbs Robinson, Coast Artillery Corps, from August 1, 1933. First Lt. James Faulkner Pichel, Coast Artillery Corps, from Augiist 1, 1933. First Lt. John Haleston, Infantry, from August 1, 1933. First Lt. Charles Clifton Blanchard, Field Artillery, from August 1, 1933. First Lt. Clyde Beauchamp Bell, Cavalry, from August 1, 1933. First Lt. Henry Winston Holt, Field Artillery, from August 1, 1933. First Lt. John Magruder Bethel, Cavalry, from August 7, 1933. First Lt. Clarence Page Townsley, Field Artillery, from August 10. 1933. First U. Robert Hilton Offley, Infantry, from August 21. 1933. First Lt. John Mesick, Field Artillery, from Augiist 22, 1933. First Lt. Francis Parker Tompkins, Cavabr. from August 24. 1933. T.xxvm- 32 CONGRESSIONAL First Lt. John Arthur Weeks. Coast Artillery Corps, from ^""^t S. '^^iericlc William Gerhard, Jr, Chemical War- fare Service, from August 30. 1933. , » _* First Lt. Cornelius Comegy s Jadwin. Cavalry, from August 31 1933 First Lt. Jacob Gunn Sucher, Ordnance Department, from ^"^t Lt. Howard Harvey Newman, Jr.. Coast Artillery Corps, from September 1. 1933. «**.-, First Lt. Richard Gray McKee. Infantry, from Septembci 1 1933 ' First Lt. Nevins Dorsey Young. Coast Artillery Corps, fronc September 1. 1933. , ^ ^ ^ First U. William Lillard Barriger. Cavahr. from Septem- ber 1. 1933. , *_ « * First Lt. Frederick Williams Penn, Cavalry, from Septem bcr 1. 1933. , ^ . _ , First Lt. Joseph Charles Kovarik, Infantry, from Sep- tember 1. 1933. , ^ F*rst Lt. Paul Williara George. Coast ArtiUery Corps, from September 1. 1933. ,^ _* . First Lt. Jonathan Lane Holman, Ordnance Department, Irom September 1. 1933. „ ^ w i First U. Wynot Rush Irish. Infantry, from September 1 1933 J First Lt. Francis Earle RundeU. Quartermaster Corp^. from September 1. 1933. „ * J. First Lt. Royal Adam Machle, Infantry, from Septcmbe^ 1 1933. First Lt. Leonard Randall Nachman. Infantry, from Sep- tember 1, 1933. First U. Clark Hazen Mitchell. Field Artillery, from Sep- tember 1. 1933. First Lt. William Maynadier Miley. Infantry, from Sep- tember 1. 1933. ^ ^ First U. George Baird Hudson, Cavalry, from September 1 1933. First Lt. Harry Clay Mewshaw, Cavalry, from September : . 1933. First Lt. Alfred Armstrong McNamee, Infantry, from Sej - tember 1. 1933. First Lt. Francis Joseph Achatz. Field ArttUery, from September 1. 1933. First Lt. Leon Calhoun Boineau, Infantry, from Septemtw r I 1933. First Lt. Harold Wilbert Gould, Infantry, from September II 1933. First Lt. George Bittmann Barth, Field Artillery, from September 12. 1933. First Lt. Harry Benham Sherman. Infantry, from Sep- tember 15, 1933. First Lt. Frank Thorpe Turner, Cavalry, from SeptemtoT 36. 1933. First Lt. Thomas Quinton Donaldson, Jr., Cavalry, fron October 1, 1933. Fa»t Lt. Philip Edward Gallagher, Infantry, from Octob t 1 1933. ' First Lt. Carroll Kimball Leeper. Infantry, from Octob sr 1 1933. ' First Lt. Charlie Quillian Llfsey, Infantry, from October 1, 1933. First Lt. Hugh McCalla Wilson, Jr., Infantry, from O:- tober 1. 1933. ^-- Fh^t Lt. Dorr Hazlehurst. Infantry, from October 1, 19! 3. First Lt. Robert Trueheart Foster, Infantry, from October 1. 1933. First Lt. Frederick von Harten Kimble. Air Corps, from October 1. 1S33. First Lt William Jones Hanlon. Air Corps, from October 1. 1933. First Lt. John Harold McFall, Finance Department, frcm October 1. 1933. First Lt. Howard Arnold Craig. Air Corps, from October 1, 1933. RECORD— SENATE January 4 1934 CONGRESSIONAL RECORD— SENATE 83 First Lt. Barney Leland Meeden, Quartermaster Corps,, from October 1. 1933. ^. w^ First Lt. David Robert Stinson, Air Corps, from October 1 1933 ' First Lt. Joseph Theodore Morris, Air Corps, from October 1 1933 ' First Lt. John May Connor. Finance Department, from October 1. 1933. , ^ ^ . First Lt. George Wald. Quartermaster Corps, from October 1 1933 ' First U. Armor Simpson Heffley, Air Corps, from October 1 1933 ' First Lt. Don Elwood Lowry, Quartermaster Corps, from October 1. 1933. , ^ . ^ First Lt. William Robert Sweeley, Air Corps, from October 17 1933 First Lt. George Allan McHenry. Jr., Air Corps, from October 17. 1933. First Lt. Seward William Hulse, Quartermaster Corps, from October 27. 1933. First Lt. Claude Leslie Gamble. Quartermaster Corps, from November 1, 1933. First Lt. Henry Charles Wolfe. Corpe of Engineers, from November 1. 1933. First Lt. Lemuel Edwin Edwards. Finance Department, from November 1, 1933. First Lt. Joseph Franklin Battley, Chemical Warfare Service, from November 1. 1933. First Lt. Carlyle Howe Ridenour, Air Corps, from Novem- ber 1. 1933. . ^ First Lt. Russell Carrigan MacDonald, Air Corjjs. from November 1, 1933. First Lt. Bennett Edward Meyers, Air Corps, from Novem- ber 1. 1933. First Lt. George Mitchell Grimes. Quartermaster Corps. from November 1, 1933. First Lt. Edward Bethel Jackson. Infantry, from Novem- ber 1. 1933. First Lt. Paul Hyde Prentiss, Air Corps, from November 1, 1933. First Lt. Robert Storie Heald, Air Corps, from November 1. 1933. First Lt. Warren Arthur Maxwell. Air Corps, from Novem- ber 1, 1933. First Lt. Walter Hannumn Carlisle. Coast Artillery Corps. from November 1, 1933. First Lt. William Henry Papenfoth, Coast Artillery Corps, from November 1, 1933. First Lt. Frederick Mercer Hopkins, Jr., Air Corps, from November 1, 1933. First Lt. Walter Leo Weible, Coast Artillery Corps, from November 1, 1933. First Lt. Rupert Edison Starr, Coast Artillery Corps, from November 1, 1933. First Lt. George Edgar Rice, Air Corps, from November 1. 1933. First Lt. Leonard Dickson Weddlngton. Air Corps, from November 1. 1933. First Lt. Lowell Whittier Bassett, Field Artillery, from No- vember 1, 1933. First Lt. John Henry Doherty, Finance Department, from November 1. 1933. First Lt. Edward Michael Powers, Air Corps, from Novem- ber 1. 1933. First Lt. Maurice Edgar Jennings. Chemical Warfare Serv- ice, from November 1, 1933. First Lt. Felix Marcus Alexander, Infantry, from Novem- ber 1, 1933. First Lt. Howell Harrell. Infantry, from November 1, 1933. First Lt. Paul Edmund Burrows, Air Corps, from Novem- ber 1, 1933. First Lt. George Harold Brown, Air Corps, from November 1, 1933. First Lt. Elmer Daniel Perrln, Air Corps, from November 1, 1933. First Lt. Dale Vincent GafTney, Air Corps, from November 1, 1933. First Lt. Kenneth Bonner Wolfe. Air Corps, from Decem- ber 1, 1933. First Lt. Grant Heninger, Field Artillery, from December 1, 1933. First Lt. Stanley Powloski, Infantry, from December 1, 1933. First Lt. John Milton Harman, Corps of Engineers, from December 1, 1933. First Lt. Harry Lincoln Calvin, Quartermaster Corps, from December 1, 1933. First Lt. Henry Herbert, Corps of Engineers, from Decem- ber 1. 1933. First Lt. Chester Carroll Hough, Corps of Engineers, from December 1, 1933. First Lt. Conrad Palmer Hardy, Corps of Engineers, from December 1, 1933. First Lt. Clifford Irving Hunn, Cavalry, from December 1. 1933. First Lt. Patrick Francis Craig, Chemical Warfare Service, from December 1, 1933. First Lt. Chester Howard Elmes, Infantry, from December 1, 1933. First Lt. Edward Vanmeter Macatee, Infantry, from De- cember 1, 1933. First Lt. John Vernon Hart, Air Corps, from December 1. 1933. First Lt. Wilbur Fisk Browder, Infantry, from December 1. 1933. First Lt. Richard Hartnett Magee, Air Corps, from Decem- ber 1, 1933. First Lt. Henry Harold Reily, Air Corps, from December 1, 1933. First Lt. Henry DuPree, Infantry, from December 2. 1933. First Lt. John Caraway Arrowsmith, Corps of Engineers, from D^ember 4. 1933. To be first lieutenants Second Lt. William Jordan Verbeck. Infantry, from May 24, 1933. Second Lt. Aloysius Joseph Lepping, Coast Artillery Corps, from June 1, 1933. Second Lt. Joseph Gandhi, Field Artillery, from June 1, 1933. Second Lt. Fay Roscoe Upthegrove, Air Corps, from June 1, 1933. Second Lt. John Marion Moore, Field Artillery, from June 1, 1933. Second Lt. Stuart Wood. Field Artillery, from June 1, 1933. Second Lt. Lawrence Edward Shaw, Coast Artillery Corps, from June 1, 1933. Second Lt. Matthew Kemp Deichelmann, Coast Artillery Corps, from June 10. 1933. Second Lt. Nathan Alton McLamb, Coast Artillery Corps, from June 10. 1933. Second Lt. William Jefferson Glasgow, Jr., Infantry, from June 19, 1933. Second Lt. Charles Bertody Stone, 3d, Air Corps, from June 24, 1933. Second Lt. Prank Thomas Ostenberg, Coast Artillery Corps, from July 1, 1933. Second Lt. John Harold Kochevar, Coast Artillery Corps, from July 1, 1933. Second Lt. Ernest Benjamin Gray, Infantry, from July 1, 1933. Second Lt. Douglas Campbell, Infantry, from July 1, 1933. Second Lt. William Joseph Phelan, Infantry, from July 1, 1933. Second Lt. Joy Thomas Wrean, Coast Artillery Corps, from July 1, 1933. Second Lt. John Joseph Hoist, Coast Artillery Corps, from July 1. 1933. Second Lt. Guy Ernest Thrams, Coast Artillery Corps, from July 1. 1933. Second Lt. Arthur Roth, Coast Artillery Corps, from July 1, 1933. Second Lt. Carl Sherman Grayfoeal, Infantry, from July 1. 1933. Second Lt. Ralph Wise Zwicker, Infantry, from July 9, 1933. Second Lt. Woodson Pinch Hocker. Infantry, from July 18, 1933. Second Lt. Cyril Edward Williams, Infantry, from August 1, 1933. Second Lt. Vachel Davis Whatley, Jr., Infantry, from August 1, 1933. Second Lt. Harry Ellery McKinney, Infantry, from August 1, 1933. Second Lt. Carl Elliott Lundquist. Infantry, frmn August 1, 1933. Second Lt. Antulio Segarra. Infantry, from August 1, 1933. Second Lt. Guy Stanley Meloy. Jr., Infantry, from August 1, 1933. Second Lt. George Van Horn Moseley, Jr., Infantry, from August 1. 1933. Second Lt. Roy William Axup. Infantry, from August 1. 1933. Second Lt. John Walker Kirby, Air Corps, from August 1, 1933. Second Lt. Forrest Anthony Homisher, Infantry, from August 1, 1933. Second Lt. Raymond Earle Bell, Infantry, from August 7, 1933. Second Lt. Dudley George Strickler. Infantry, from August 10, 1933. Second Lt. Dana Powers McGown, Infantry, from August 17, 1933. Second Lt. Charles Boal Ewing, Infantry, from August 21, 1933. Second Lt. Felix Alex Todd, Jr., Infantry, from August 22. 1933. « Second Lt. Barney Avant Eteughtry. Infantry, from August 24, 1933. Second Lt. Philip DeWitt Ginder. Infsmtry, from August 28, 1933. Second Lt. Ralph Edwin Doty. Infantry, from August 30, 1933. Second Lt. Howell Hopson Jordan. Infantry, from August 31, 1933. Second Lt. Robert Frederick Sink. Infantry, from August 31, 1933. Second Lt. Elmer Matthew Webb, Jr., Infantry, from September 1, 1933. Second Lt. John Frame Kaylor, Infantry, from September 1, 1933. Second Lt. Christian Ootthard Nelson, Field Artillery, from September 1, 1933. Second Lt. Martin Joseph Morln. Infantry, from Septem- ber 1, 1933. Second Lt. Gilbert McKee Allen, Jr.. Infantry, from September 1, 1933. Second Lt. Calvin Louis Whittle, Infantry, from Sep- tember 1, 1933. Second Lt. George Emerlcus Bender, Infantry, from September 1, 1933. Second Lt. Jack Henry Griffith, Infantry, from September 1, 1933. Second Lt. Robert Campbell Aloe, Infantry, from Sep- tember 1, 1933. Second Lt. Montgomery McKee, Infantry, from September 1, 1933. Second Lt. Nelson Irving Pooits, Infantry, from September 1, 1933. Second Lt. Lawton Butler, Infantry, from September 1, 1933. Second Lt. Marion Huggins, Air Corps, from September 1, 1933. Second Lt. Martin Moses, Infantry, from September I, 1933. Second Lt. Robert John West, Jr., Field Artillery, from September 1, 1933. CONGRESSIONAL B ECORD— SEN ATE ^ I 84 Second Lt. Edgar Daniel Stark, Infantry, from September 1 1933 Second IX. David Drew Hedekin, Infantry, from Sep- tember 1. 1933. , . ^ -_ Second U. James William Smyly. Jr., Infantry, from September 1. 1933. Second Lt. Raymond Gregory Stanton, Infantry, from September 1. 1933. Second Lt. Neil Bosworth Harding, Air Corps, from Sep- tember 1. 1933. ^ ^ ^ Second Lt. Jesse Floyd Dressier, Infantry, from September 3 1933. Second Lt. Willis Small Matthews, Infantry, from Sep- tember 11. 1933. ^ ^ Second Lt. Robert Lewis Easton. Air Corps, from Septem- ber 12, 1933. , ^ ^ Second Lt. Henry Malone Bailey. Infantry, from Septem- ber 15. 1933. ^ „ * v^ Second Lt. Fred Leroy Thorpe. Infantry, from September 26. 1933. Second Lt. William Rapier Francis Bleakney, Infantry, from October 1. 1933. Second U. Harold Henry Hunt. Field Artillery, from October 1. 1933. ' ^ ^ ^^ ^ Second Lt. Joseph Lawrence Dark. Infantry, from Octobxir Second Lt. Frank Keith Park, Air Corps, from October 1. 1933. U "• ' Second Lt. Walter William Gross, Air Corps, from October 1, 1933. , ^ ^• January 4 1934 CONGRESSIONAL RECORD— SENATE 85 Second Lt. Joseph George Felber, Infantry, from October 1 1933. " 'second Lt. Otto Clyde George, Air Corps, from October 1 1933. Second Lt. John N. Jones. Air Corps, from October 1, 1933. Second Lt. Morris Miller Bauer. Corps of Engineers, from October 1. 1933. Second Lt. Frank Alfred Lightfoot. Field Artillery, from October 1. 1933. Second Lt. John Richmond Pitman, Jr., Field Artillery. from October 1. 1933. Second Lt. George Selman. Infantry, from October 1, 1933. Second Lt. Earl Clarence Bergquist, Infantry, from Octo- ber 1. 1933. Second W. Richard Chase, Infantry, from October 1. 1933. Second Lt. Albert Neil Hickey. Infantry, from October 1. 1933. Second Lt. Ronald Irving Pride, Field Artillery, from October 1. 1933. Second Lt. Royce Alison Drake, Cavalry, from October 1, 1933. Second Lt. Paul Alfred Disney, Cavalry, from October 1. 1933. Second Lt. Leo William De Rosier, Air Corps, from Octo- ber 17. 1933. Second Lt. Gordon Phihp Saville. Air Corps, from October 17. 1933 Second Lt. Charles Bernard Overacker, Jr., Air Corps, from October 27. 1933 Second Lt. George Henry Macnair, Air Corps, from November 1, 1933. Second Lt. WiUiam Barwig Blaufuss, Air Corps, from November 1, 1933. Second Lt. Louis Howard Foote, Corps of Engineers, from November 1, 1933. Second Lt. James Arthur Ellison. Air Corps, from Novem ber 1, 1933. Second Lt. Hoyt Leroy Prindle, Air Corps, from November 1. 1933 Second Lt. James Franklin Walsh. Air Corps, from Novem- ber 1. 1933 Second Lt. George Richard Geer, Air Corps, from No- vember 1, 1933 Second Lt. Donald Wright Benner. Air Corps, from No- i^ember 1. 1933. Second Lt. Harry John Flatequal. Air Corps, from Novem- ber 1 1933. Second Lt. Herman Franklin Woolard, Air Corps, from November 1. 1933. Second Lt. Lawrence Henry Douthlt, Air Corps, from November 1. 1933. Second Lt. George Robert Acheson, Air Corps, from No- vember 1. 1933. Second Lt. Prank Hamlet Robinson. Air Corps, from No- vember 1, 1933. Second Lt. Waldine Winston Messmore. Air Corps, from November 1, 1933. Second Lt. Herbert Melvin Newstrom. Air Corps, from November 1. 1933. Second Lt. Allen Ralph Springer. Air Corps, from Novem- ber 1. 1933. Second Lt. Franklin Calhoun Wolfe. Air Corps, from No- vember 1. 1933. Second Lt. Ford Larimore Fair, Air Corps, from November 1 1933. ' Second Lt. Ivan Maurice Palmer. Air Corps, from Novem- ber 1, 1933. Second Lt. Joseph Gerard Hopkins, Air Corps, from No- vember 1. 1933. Second Lt. Elmer Perry Rose, Air Corps, from November 1 1933. Second Lt. John Adams Austin, Air Corps, from November 1933. Second U. Ford J. Lauer. Air Corps, from November 1, 1933. Second Lt. Fay Oliver Dice, Air Corps, from November 1, 1933. Second Lt. Herbert Everett Rice. Air Corps, from Novem- ber 1. 1933. Second Lt. Edward Harold Porter. Air Corps, from No- vember 1, 1933. Second Lt. Joseph Hampton Atkinson. Air Corps, from November 1. 1933. Second Lt. Robert Leonard Schoenlein. Air Corps, from November 1. 1933. Second Lt. Frederick William Ott. Air Corps, from No- vember 1, 1933. Second Lt. Wentworth Goss. Air Corps, from November 1, 1933. Second Lt. James Leslie Daniel. Jr., Air Corps, from No- vember 1. 1933. Second Lt. Budd John Peaslee, Air Corps, from November 4. 1933. Second Lt. Vera H. Wiseman, Infantry, from December 1, 1933. Second Lt. John Franklin Egan. Air Corps, from Decem- ber 1. 1933. Second Lt. Edgar Russell Todd.* Air Corps, from December , 1. 1933. Second Lt. Arthur LaSalle Smith, Air Corps, from Decem- ber 1. 1933. Second Lt. Donald Dewey Arnold. Air Corps, from Decem- ber 1. 1933. Second Lt. Clarence Thomas Mower, Air Corps, from De- cember 1. 1933. Second Lt. Louie Percy Turner. Air Corps, from December 1, 1933. Second Lt. James Laffeter Green. Corps of Engineers, from December 1. 1933. Second Lt. Thomas Alphonsus Lane. Corps of Engineers, from December 1. 1933. Second Lt. Theodore Scott Riggs, Cavalry, from December 1. 1933. Second Lt. Frederick Jensen Dau, Corps of Engineers, from December 1, 1933. Second Lt. William Tell Hefley, Air Corps, from December 1, 1933. Second Lt. Roland Clough Brown. Corps of Engineers, from December 1, 1933. Second Lt. Samuel Roberts Browning. Corps of Engineers, from December 1, 1933. Second Lt. Lyle Edward Seeman. Corps of Engineers, from December 1. 1933. Second Lt. Raphael Brill Ezekiel. Corps of Engineers, from December 1. 1933. Second Lt. William Dixon Smith, Corps of Engineers, from December 2. 1933. Second Lt. Thomas Fraley Van Natta, 3d, Cavalry, from December 4, 1933. Second Lt. Robert Scott Israel, Jr., Air Corps, from Decem- ber 8. 1933. Second Lt. David Andrew Watt, Jr.. Corps of Engineers, from December 19, 1933. Second Lt. Donald Bertrand Smith. Air Corps, from De- cember 22, 1933. MEDICAL CORPS To be colonels Lt. Col. Henry Church Pillsbury. Medical Corps, from June 15. 1933. Lt. Col. Edgar King, Medical Corps, from June 15. 1933. Lt. Col. Ray Woodman Bryan, Medical Corps, from June 15. 1933. Lt. Col. William Hadley Richardson. Medical Corps, from June 15. 1933. Lt. Col. William Kay Bartlett. Medical Corps, from Jime 15. 1933. To be lieutenant colonel Maj. Bertram Foster Duckwall. Medical Corps, from No- vember 15. 1933. * To be captains First Lt. Richard Love Daniel, Medical Corps, from July 1, 1933. \ First Lt. Otis Otto Benson, Jr., Medic^l-<:orps, from July 1. 1933. First Lt. Ernest Holden Parsons. Medical Corps, from July 1, 1933. First Lt. Kenneth Arthur Brewer, Medical Corps, from July 1. 1933. First Lt. Norman Wilhalm Anderson. Medical Corps, from July 1. 1933. First Lt. Paul Strimple Fancher. Medical Corps, from July 1, 1933. First Lt. Vinnie Hale Jefifress, Medical Corps, from July 1, 1933. First Lt. Kenneth Fredrick Ernst, Medical Corps, from July 1, 1933. First Lt. Theodore Longworth Finley. Medical Corps, from July 1, 1933. First Lt. Kermit Hoyt Gates. Medical Corps, from July 1, 1933. First Lt. Charles Lee Kirkpatrick, Medical Corps, from July 1. 1933. First Lt. Loyd Eugene GrifBs, Medical Corps, from July 1, 1933. First Lt. Joseph Hamilton McNinch, Medical Corps, from July 1, 1933. First Lt. William Jefifers Kennard. Medical Corps, from July 1. 1933. First Lt. Edward Miller Sager, Medical Corps, from July 1, 1933. First Lt. Allan Brodie Ramsay. Medical Corps, from July 1. 1933. First Lt. Achilles Lacy Tynes. Medical Corps, from July 1, 1933. First Lt. Robert Barrett Skinner, Medical Corps, from July 1, 1933. First Lt. Dwight Lawson. Medical Corps, from July 1, 1933. First Lt. Joseph Pease Russell, Medical Corps, from July 1, 1933. First Lt. James Little Murchison, Medical Corps, from July 1. 1933. First Lt. Norman Webb White, Medical Corps, from July 1, 1933. First Lt. William Clarence Knott, Medical Corps, from July 1. 1933. First Lt. Paul Edmund Keller, Medical Corps, from July 1, 1933. First Lt. Albert Henry Robinson, Medical Corps, from July 1. 1933. First Lt. John Frederick Blatt, Medical Corps, from July 1, 1933. First Lt. John Randolph Copenhaver, Medical Corps, from July 1. 1933. First Lt. Cyril Edward McEnany, Medical Corps, from July 1, 1933. First Lt. Frank Yearsley Leaver, Medical Corps, from July 1, 1933. First Lt. Joe Harrell. Medical Corps, from July 1, 1933. First Lt. Leonard Neil Swanson, Medical Corps, from July 1, 1933. First Lt. Armin Walter Leuschner, Medical Corps, from August 17, 1933. First Lt. John Ellsworth Roberts, Medical Corps, from September 1, 1933. First Lt. Ralph Vernon Plew. Medical Corps, from Septem- ber 25, 1933. First Lt. Wayne Glassbum Brandstadt, Medical Corps, from September 25. 1933. First Lt. Edward James Kendricks. Medical Corps, from October 1, 1933. First Lt. Oliver Harold Waltrip. Medical Corps, from Octo- ber 1 1933. Pirat Lt. Thomas James Hartford. Medical Corps, from December 2. 1933. DENTAL CORPS To be lieutenant colonels Maj. Walter Lee Reesman, Dental Corps, from June 12, 1933. Maj. Samuel John Randall, Dental Corps, from November 13. 1933. Maj. Don Gordon Moore. Dental Corps, from November 13, 1933. Maj. Oscar George Skelton, Dental Corps, from November 14, 1933. Maj. Robert Beeghly Tobias, Dental Corps, from November 14, 1933. Maj. Harry Clothey Peavey, Dental Corps, from November 14. 1933. To be captains First Lt. Tyler James Walker. Dental Corps (appointed first lieutenant. Dental Corps, during the recess of the Sen- ate) . from July 6, 1933. First Lt. Wallace Jacob Morlock. Dental Corps (appointed first lieutenant. Dental Corps, during the recess of the Sen- ate) . from October 15, 1933. VFrERINARY CORPS To be lieutenant colonels Maj. Jacob Edward Behney, Veterinary Corps, from Sep- tember 3, 1933. Maj. Jesse Daniel Derrick, Veterinary Corps, from Sep- tember 7, 1933. Maj. Raymond Alexander Kelser, Veterinary Corps, from September 7, 1933. Maj. Clell Brlcker Perkins, Veterinary Corps, from Sep- tember 10. 1933. Maj. Horace Samuel Eakins, Veterinary Corps, from Sep- tember 10. 1933. Maj. Isaac Owen Oladish, Veterinary Corps, from Sep- tember 10, 1933. Maj, Jean Rossman Underwood, Veterinary Corps, fnwn September 10, 1933. Maj. CUfford CasweU Whitney, Veterinary Corps, from September 10, 1933. ^ Maj. Harold Edward Egan, Veterinary Corps, from Sep- tember 10. 1933. Maj. Christian William Greenlee, Veterinary Corps, from November 26, 1933. 86 CONGRESSIONAL ^ RECORD— SENATE January 4 Mmj. William Henry Houston, Veterinary Corps, from November 27. 1933. To be major Capt. Jack Glendon PuUer. Veterinary Corps, from No- vember 25. 1933. . To be captain First Lt. Stanley McLeod Nevin. Veterinary Corps, from August 4. 1933. To be first lieutenants Second Lt. Austin Taylor Getz, Veterinary Corps, from July 22, 1933. ^ . Second Lt, Wesley Watson Bertz, Veterinary Corps, from August 4. 1933. ^ . Second Lt. Bdgerton Lynn Watson. Veterinary Corps, from August 4. 1933. MEDICAL ADMUnSTRATTVE CORPS To be first lieutenants Second Lt. Paul Estabrooke Zuver. Medical Administrative Corps, from November 28. 1933. Second Lt. Orion Victor Kempf, Medical Administrative Corps, from December 26. 1933. Second Lt. Kindrick Ownby. Medical Administrative Corps, from December 26. 1933. Second Lt. Robert Lee Black. Medical Administrative Corps, from December 26. 1933. CHAPLAIHS To be chaplain loith the rank of lieutenant colonel Chaplain Alexander Daniel Sutherland (major). United States Army, from November 25. 1933. To be ctiaplains with the rank of major Chaplain Ivan Loveridge Bennett (captain) , United States Army, from July 29. 1933. Chaplain Monroe Starkey Caver (captain) , United States Army, from August 1, 1933. Chaplain John Knox Bodel (captain). United States Army, from August 16. 1933. Chaplain William Roy Bradley (captain), United State i Army, from August 24, 1933. Chaplain James Lloyd McBride (captain). United State i Army, from August 26. 1933. Chaplain Thomas Lawrence McKenna (captain). United States Army, from August 27. 1933. Chaplain Mylon Dickinson Merchant (captain). Unite I States Army, from September 1. 1933. Chaplain Maurice William Reynolds (captain). United States Army, from September 8. 1933. Chaplain HeiUT Russell Westcott, Jr. (captain). Unite 1 States Army, from September 27, 1933. Chaplain Albert Floyd Vaughan (captain). United StaUs Army, from October 2, 1933. Chaplain Jodie Gibson Stewart (captain). United States Army, from October 7. 1933. Chaplain Oynther Storaasli (captain). United SUt«s Army, from October 11. 1933. Chaplain Commodore Robert Watkins (captain). United States Army, from October 20. 1933. Chaplain Ivan Gochnauer Martin (captain) , United Stat. United States Army, from December 2. 1933. Chaplain Walter Hilary Paschal (first heutenant), UniUd States Army, from December 26. 1933. Promotions in thb Philippini Scouts To be lieutenant colonels MaJ. Hugh Straughn, Philippine Scouts, from September 1, 1933. MaJ. Eacott Berton MiUer, Philippine Scouts, from SejH tember 26, 1933. To be major Capt. James Williston Callahan, Jr.. Philippine Scouts, from October 1, 1933. To be first lieutenant Second Lt. Bienvenido Moba Alba. Philippine Scouts, from October 1. 1933. Appointments and Promotions in the Navy M-'MUNE CORPS MaJ. Gen. (temporary) John T. Myers to be a major general in the Marine Corps from the 1st day of September 1933. with rank from the 1st day of October 1931. Brig. Gen. John H. Russell to be a major general (tempo- rary) in the Marine Corps from the 1st day of September 1933. Col. Charles H. Lyman to be a brigadier general in the Marine Corps from the 1st day of September 1933. Col. Louis McC. LitUe to be a brigadier general in the Marine Corps from the 1st day of January 1934. Brig. Gen. Hugh Matthews, the quartermaster, to be the quartermaster of the Marine Corps with the rank of briga- dier general for a period of 4 years from the 26th day of December 1933. with rank from the 26th day of December 1929. Lt. Col. Charles R. Sanderson, assistant quartermaster, to be an assistant quartermaster in the Marine Corps with the rank of colonel from the 1st day of September 1933. Lt. Col. Walter N. Hill to be a colonel in the Marine Corps from the 24th day of December 1933. Maj. Paul A. Capron to be a lieutenant colonel in the Marine Corps from the 1st day of September 1933. Maj. John Potts to be a lieutenant colonel in the Marine Corps from the 1st day of October 1933. Maj. Edward A. Ostermann to be a lieutenant colonel in the Marine Corps from the 24th day of December 1933. Capt. Arthur H. Turner to be a major in the Marine Corps from the 1st day of September 1933. Capt. James F. Moriarty to be a major in the Marine Corps from the 1st day of October 1933. Capt. Peter Conachy to be a major in the Marine Corps fr 1*3S (Ending June 30. 1B35) The Budget estimates of expenditures, exclusive of deb retirement of $525,763,800 and exclusive also ot such sum m\ may be necessary for new and extraordinary recovery pur poses, for the fiscal year ending June 30, 1935. amount t Emergency: _^ Public Works Administration 1.089.883.10) Agricultural Adjiistment Administration- Emergency conservation work Reconstruction Finance Corporation. Tennessee Valley Authority.. _.. Federal land banks 5. 000. GOD 65, 190,00) > 480, 436. 60 3 31.000.00) 12.650.00) Total, emergency. 723. 286. 50 [) Total, general and emergency, less public- debt retirements 8.960.798.70b It will be noted that many of these items such as public works fall under appropriations made in 1933. the acturl expenditures not taking place until after June 30, 193-. (For details of above expenditures see Budget Statement No. 3. table A.) The above figures do not include additional loans by the Reconstruction Finance Corporation. If its loaning authoi- ity is exteiuied beyond June 30. 1934, it is contemplated that any additional loans by it would thereafter be taken froii the new and additional recovery fimd hereinafter referrel to. The estimates of receipts for the next fiscal year (endin i June 30. 1935). exclusive 6f foreign-debt payments, of in- creased liquor taxes, and of increased revenue flowing froia amendments to the existing revenue law, amount to $3,974- 665.479. (See Budget SUtement No. 2, table A.) Therefore, exclusive of debt retirement, these Budget estimates for the next fiscal year show a small surplus cf $13,866,779. But it must be borne in mind that this sui- plus does not include any additional expenditures for ex- traordinary recovery purposes. It is clear that the necessity for relief and recovery wil still be with us during the year 1934-35. Additional reh(f funds will be necessary. Further needs of the country pre - hibit the abrupt termination of the recovery program. Ho ■I * ■ - at credits — deduct. person can on this date definitely predict the total amount that will be needed, nor the itemizing of such an amount. It is my best judgment at this time that a total appropria- tion of not to exceed $2,000,000,000 will, with the expendi- tures still to be made next year out of existing appropria- tions, be sufficient. . I shall therefore ask the Congress for appropriations approximating that amount. This amount is not included in the Budget estimates. If appropriated and expended, therefore, it will change the small estimated surplus of $13,000,000 into a debt increase of nearly $2,000,000,000. It is only fair, of course, to say that such a debt increase would be partially offset by loans made against collateral and assets pledged. Therefore, the toUl debt, if increased by the sum of $2,000,000,000 during the fiscal year 1935. would amount to approximately $31,834,000,000 on June 30. 1935. It is my behef that so far as we can make estimates with our pres- ent knowledge, the Government should seek to hold the total debt within this amount. Furthermore, the Govern- ment during the balance of this calendar year should plan to bring its 1936 expenditures, including recovery and re- lief, within the revenues expected in the fiscal year 1936. Let me put it another way: The excess of expenditures over receipts during this fiscal year amounts to over $7,000,000,000. My estimates for the coming fiscal year show an excess of expenditures over receipts of $2,000,000,000. We should plan to have a definitely balanced Budget for the third year of recovery and from that time on seek a continuing reduction of the national debt. This excess of expenditures over revenues amounting to over $9,000,000,000 during 2 fiscal years h^been rendered necessaiT to bring the country to a souni^ondition after the unexampled crisis which we encountered last spring. It is a large amount, but the immeasurable benefits justify the cost. The following table shows expenditures and receipts for the fiscal years 1934 and 1935 as contained in the Budget, plus the additional expenditures which will be made out of additional authorizations and appropriations here recom- mended. It shows, also, the estimated increase in the public debt and the book value of assets held as security against loans: iva 1935 2-reax period 1934-35 Receipt*! $3. 259. 93«, 756 $3, 974. fi&V 479 r. 234, fiOl, 235 Ezpeiuiitares (Mclusive of debt retire- ment1; Oeneral - Agricultural Adjustment Admin- istration Emergeocy • Additional expenditures from additional appropruktion^. 2. 53a 720. 287 .114.800.000 6, 357, 48fi, 700 2, 4Sft. 70R. 200 7.V>. 744. 000 723.280,500 S, 017. 48S. 4S7 1.2B.1. .V44.000 7. ceo. 773, 200 Total expenditures. Incream in debt ' Estimated book value of assets bfltd as security lor loans 9,403.006,967 I 3.960.799.700 j 13. 363. 805.667 1,166.000,000 ' 2. 000. OnO. 000 I 3. 166, 000, 000 lO.SflQ.006.967 I 5, 960. TBft. TOO 16. 529. M». 667 7,309.068,211 1. 986, 133. 221 9. 2B5. 201. 433 6, 461. 969. 273 ■ Tbeae estim)it«s of receipts are preoration debentures issued to banks and other institutiooi. 1934 CONGRESSIONAL RECORD— HOUSE 91 APPKOPKIATIOKS The Budget estimates of appropriations for 1935, exclusive of Agricultural Adjustment Administration benefit payments and refunds of processing taxes, but inclusive of all other appropriations for regular departments and independent establishments including interest on the debt and debt re- tirement, are $2,980,293,833.60. When compared with Budget estimates of appropriations transmitted in the Budget for 1934, they show a reduction of $684,913,167. A tabular comparative summary of receipts, estimates, appropriations, and expenditures, classified according to general and emergency items and listed by departments and under other general heads, appears in Budget Statement No. 1, Uble B. TAXES The estimates of receipts take no account of the addi- tional revenue which may be obtained from an increase in liquor taxes and from the proposed changes in the income tax law. Since neither of these tax measures has come before Congress as yet, no accurate estimate can be made of their yield. However, if, as proposed by the Committee on Ways and Means, the tax on distilled spirits is increased from $1.10 a gallon to $2 a gallon, and the rates of tax on wines are also increased, the estimated revenue would be increased by approximately $50,000,000, assuming that- con- sumption Is not afifected by additional gallonage taxes im- posed by the States. Considerable additional revenue can also be secured from administrative changes in the income tax law, which may amount to as much as $150,000,000 for a full year. The estimates for the Post Office Department are predi- cated upon a continuation of the 3 -cent postal rate for non- local mail. It is highly important that this rate be continued. I recommend its continuance. ECONOMY LEGISLATION The estimates of appropriations submitted in the Budget are predicated on the continuation of certain economy leg- islative provisions, which I ask to be enacted and which are appended hereto. The most important is that having to do with reduction of compensation of Federal employees. It is eminently fair that, the cost of living having fallen as compared with 1928, the employees of the Government sus- tain some reduction in compensation. This is not incon- sistent with our poUcy of advocating an increase in wages in industry. For wages there had fallen far beyond any reduction contemplated for Federal employees and in most grades are even now substantially below compensation paid Federal employees imder the maximum reduction of 15 percent. Among the legislative provisions appended hereto is one prohibiting automatic increases in compensation except in the Army, Na\T, and Marine Corps. The personnel of these three services are engaged in a life service to their coun- try. Some, by reason of the pay freezes, have sustained reduction in compensation of more than 25 percent. They afe, therefore, in a different category from those in other governmental agencies. They should, in 1935, be released from the restrictions on automatic increases in compen- sation. CONTROL Up to now there has been no coordinated control over emergency expenditures. Today, by Executive order, I have imposed that necessary control in the Bureau of the Budget. Heretofore emergency expenditures have not been subject to audit by the Comptroller General of the General Account- ing Office. Today I am, by Executive order, reposing in him the authority to conduct such an audit and to continue to audit each such expenditure. Hereafter, therefore, just as in the departmental expenditures, there will be, in emer- gency expenditures, a pre-Budget and a post-audit. By reason of the fact that the Bureau of the Budget has had no control in the past over the various expenditures, obligations, and allotments made by the emergency organi- zations, the task of preparing the present Budget has been the most difficult one since the Budget and Accounting Act went into effect in 1921. These difficulties in future years will be substantially minimized by the control which I have established. It is evident to me, as I am sure it is evident to you, that powerful forces for recovery exist. It Is by lajring a foimda- tion of confidence in the present and faith in the future that the upturn which we have so far seen will become cumulative. The cornerstone of this foundation is the good credit of the Government. It is, therefore, not strange nor is it academic that this credit has a profound effect upon the confidence so neces- sary to permit the new recovery to develop into maturity. If we maintain the course I have outlined, we can coofl- dently look forward to cumulative beneficial forces repre- sented by increased volume of business, more general profit, greater employment, a diminutim oi reUef expenditures, larger governmental receipts and repasrments, and greater human happiness. Franxlih D. Rooskvklt. Jamuabt 3, 1934. icxssagi peom thx prssmknt of thx tthited states — butsau of indian affairs The SPEAKER laid before the House the following mes- sage from the President of the United States, which was read and, together with the accompanying papers, referred to the Committee on Appropriations and ordered printed: To the Congress of the United States: 1 transmit herewith for the consideration of Congress. pursiiant to the provisions of the act of March 2, 1933 (Public. 410, 72d Cong.), an alternate arrangement of the estimates of appropriations for the Bureau of Indian Affairs. Department of the Interior, for the fiscal year 1935. The details of this alternate arrangement of the estimates are set forth in the letter of the Director of the Bureau of the Budget, which is transmitted herewith, and with which I concur. Franklin D. Rooskvklt. The White House, January 3, 1934. LIQUOR TAXING ACT OF 1934 Mr. DOUGHTON of North Carolina. Mr. Speaker. I move that the House resolve itself into the Committee of the Whole House on the state of the Union for the considera- tion of the bill (HJl. 6131) to raise revenue by taxing cer- tain intoxicating hquors, and for other purposes; and. pend- ing that, I ask unanimous consent that there may be 4 hours of general debate, one half of which to be controlled by the gentleman from Massachusetts [Mr. Trkadwat] and one half by msrself . The SPEAKER. The gentleman from North Carolina [Mr. Doughton] moves that the House resolve itself into the Committee of the Whole House on the state of the Union for the consideration of the bill HJR. 6131, and, pending that, asks unanimous consent that there be 4 hours of gen- eral debate, one half to be controlled by himself and the other half by the gentleman from Massachusetts. Is there objection to the request of the gentleman from North Caro- lina [Mr. Doughton ]? Mr. O'CONNOR. Reserving the right to object, is it the intention of the Chairman of the Committee, who has con- trol of the 2 hours on this side of^ the House, to divide that between those supporting the bill and those in opposition? Mr. DOUGHTON of North Carolina. I desire to amend the unanimous-consent request by stating that the debate be confined to the bill; that there be 4 hours of general de- bate, equally divided, and that the debate shall be confined to the bill. The SPEAKER. Is there objection to the request of the gentleman from North Carolina, as amended? Mr. O'CONNOR. Reserving the right to object, of course, the gentleman knows that there is some opposition to the bill on this side of the House, and we who have different ideas about the subject would like to be assured of sufficient time within which to debate it. Mr. DOUGHTON of North Carolina. It is naturally as- sumed that there might be some differences of opinion as to certain rates and provisions of the bill, but I. as chairman of I v-orporsuoa ueoemures i:i6uea lo omnu moa guier ubuiuiioib. congressiona: . record— house January 4 The adjusted-service certificate bill provides for the pay- ment of the adjusted-service certificates in currency, pro- viding for controUed expansion of the currency, and is fre- quenUy referred to as the bonus bill. I ask that Members of the House sign the petiUon in order that speedy com- pensation payment may be made to our service men of the Work! War. The cruel, vicious, and inhuman so-called " economy law " has brought poverty and destitution to the homes and firesides of hundreds of thousands of men who served in 1917 and 1918. This makes the payment of these certificates more necessary now than ever. Our service men, their widows and orphans first, gentlemen. Payment of the soldiers' bonus means more than $53,- 099,000 for my own State of Minnesota, according to figures compUed and printed in the Congressional Record for Feb- ruary 18, 1932. By counties in Minnesota this means that the foUowing amounts will be paid: MUimSOTA Aitkin — ^i?- ??! It llS^:::::::::::::::::::::: 428. 84i. 97 92 the committee, was not aware of the fact that there was opposition to the bill. L Mr O'CONNOR. Well, coming right down to the poiOD. the only concrete question in it is the amount of tax (Ji whisky That is the big item. If there is a difference tf opinion on that, the opposition on this side ought to hate a fair proportion of the 2 hours in which to present the*' views. Mr DOUQHTON of North Carolina. I can assure gentleman from New York [Mr. O'Connob] that as far am concerned I shall be disposed to deal fairly with th who have different views with respect to the bill; and if we do not have sufficient time to do anything more than co^- chide the general debate today, perhaps we can extend t^e time by unanimous consent. I shall endeavor to be fairJ I assure the gentleman- v. « ^ Mr. O'CONNOR. I appreciate that, but this Is the fli^ bill that comes before this session of the Congress, andiit has been the practice heretofore, when time is allotted, „ — ^ either under a rule or under unanimous consent, that that j Anoka 466 o37 13 time on each side of the House be evenly divided betwe;n the proponents and the opponents. Now, let us start rig] it. Whenever there is 1 hour or 2 hours on a side, if there is opposition, that time sboiild be equally divided by those in control. Mr. DOUGHTON of North Carolina. In response to tti at statement. I may say that there might be a half dozen de- ferent factions. Members who would have different vietvs with reference to certain provisions of a bilL If that shoi Jd be true. I would not know how to equitably divide the tin le. Mr. COOPER of Tennessee. Will the gentleman yield? Mr. DOUGHTON of North Carolina. I jrield. Mr. COOPER of Tennessee. It is obvious that the oidy controversial question of any importance is the question of rates. The gentleman can readily appreciate the fact that there might be as many different views as to what the ri ite should be as there are Members present. In its final ana y- sis. the question of rate is of necessity a matter of con- promise. Assuming there is no pronounced opposition to the liU, certainly we can thrash out the questions as to the rite without any extended discussion of this particular phase. Mr. O'CONNOR. I do not agree with the gentleman on ^^^^^ that. The committee took many days to thrash out t lis j ^^jj^^^bec question of rates, and it is not yet thrashed out to the sai is- j Kandiyohi *g- 2i7 54 faction of a great number of people. The opposition shoild { |"^f_:v-- V V" '"." 291! 556 38 get an opportunity. May I ask the chairman of the com- 1 ^q^ Parie"::" mittee if of his 2 hours he will yield me one half an hour? I Lake Mr. DOUGHTON of North Carolina. Mr. Speaker, I co ild | Lake of the Woods not agree to that. Half a dozen Members might make he \ ]^^^^ _" came request. Unless we had 2 or 3 days of general debute, • Lyon--J^jrjlVJ^.V.J^f~-V_ _'--'. "_'_'_ 400. 241 46 I cannot see how I can assure anyone that he will get 30 j McLeod to?' 42ft S minutes out of 2 hours' time on this subject. I will ass ire ; JJ^S'T" '. """ 352 132 13 the gentleman, however — and if this be not satisf acton . I ! ^tin ''l"""I'///-V---"--I------ ---------- *«3. shall move that the debate be limited to 4 hours — but I sliall ' Meeker assiffe the gentleman that, so far as it within my power les. Mine Lacs S« on? «a Benton Big Stone Blue Bartli.- Brown Carlton Carver Cass Chippewa — Chisago Clay Clearwater.. Cook Cottonwood- Cravr Wing.. Dakota Dodge Douglas Faribault Fillmore Freeborn Goodhue ^^ir:::::::::::::::::::::::::- ^°' 122- ^25 Houston. 286,729 95 Hubbard- Isanti Itasca Jackson. 311.800.70 a03. 744 98 700.971.37 485, 193. 88 439. 714. 72 360. 744 56 322.889.61 326.431.02 273, 144. 19 478.815.20 197. 697. 66 50. 428. 85 306. 135.22 530. 735. 17 716. 400. 32 261, 150. 17 389. 617. 23 448. 205. 82 512,531.08 595.226. 11 648. 575. 07 197. 946. 18 198, 733. 16 250, 197. 51 563. 809. 04 328. 522. 73 177, 236. 18 318. 892. 58 146, 378. 28 86. 857. 74 372, 572 90 234. 085. 13 924 71 370, 998. 94 I shall be disposed to deal eminently and absolutely fa:rly with him on the subject. Mr. O'CONNOR. I appreciate that, but I have hefird similar statements so often. It is just as simple to say rikht now how much time the gentleman is going to give me as It will be at the end of a couple of hours, or after an opF or- tunity to confer about it. Mr. DOUGHTON of North Carolina. A good deal depe ids on the other requests. Mr. O'CONNOR. I know. I have heard that statement very often. Mr. DOUGHTON of North Carolina. And the gentleman is liable to hear it many more times under similar cinnm- stai>ces. Mr. LUNDKEN. Mr. Speaker, reserving the right to ob- ject, I call attention to House File No. 1, now on the Speak- er's desk for signature; that is, a petiticm to bring the bill before the House. We now have the signatures of more than 50 Congniss- men. We need 145 to bring the bill before the House. 526. 903. 82 581.226. 15 287,910.42 342, 750. 50 385, 578. 78 291. 203.31 733. 672. 46 Morrison Mower _. Murray . Nicollet. Nobles.. Norman. Olmsted Otter Tail 1.056.334.26 Pennington 217. 185. 77 Pine 419.667.44 Pipestone 253, 448. 98 PtJlk 745.953.49 Pope _ . _ 270,990.35 Ramsey 5, 937. 991 91 Red Lake - 142,629.77 Redwood 427. 040. 20 Renville 489. 687. 95 Rice 820. 761 54 Rock 227, 023. 02 Roseau 261.380.91 St. Loills 4.237,183.16 Scott 292. 342. 36 Sberbume 201. 073. 39 Sibley 328, 564. 15 Stearns 1. 286. 525. 91 Steele 382. 617. 25 1934 CONGRESSIONAL RECORD— HOUSE 93 MINNESOTA — CO \tlnued Stevens Swift Todd Traverse Wabasha Wadena Waseca Washington Watonwan Wilkin Winona Wright Yellow Medicine - $210,931.35 305. 161.85 541.980.70 1G4.395. 98 364. 765. 23 227. 602. 90 298, 472. 52 512, 634 63 265. 129.42 202,771.61 727. 832. 24 561. 634.49 344, 303. 75 Total 53.099.466.63 For Minneapolis and the Third Congressional District of Minnesota it means that the following amounts will be paid: Hennepin County $10,723,327.35 Anoka County 381.374.65 Chisago County 273. 144. 19 Isanti County 250,197.51 Washington County 512,634.63 Total 12. 140. 678. 33 According to the figures quoted in the Congressional Record for December 10. 1931. this means that 83,049 vet- erans in Minnesota will receive immediate cash payments. Why not pay the soldiers' certificates in currency now? The money so distributed will fall like a gentle rain on the parched countryside, and will do more to restore prosperity at this moment than any act proposed by the administration. Mr. MAY. Mr. Speaker, will the gentleman yield? Mr. DOUGHTON of North Carolina. I yield. Mr. MAY. Mr. Speaker, I understand the Louisiana elec- tion-contest case has been passed over until Monday. The floor leader made the statement this morning that he is not particularly interested in this bill being completed before Saturday. In view of the number of Members who have expressed an interest in the discussion of this bill, would it not be better to agree to a longer time for general debate? Mr. DOUGHTON of North Carolina. Mr. Speaker, if it is agreeable to the gentleman from Massachusetts I Mr. Tread- way], with whom there was a tentative understanding, it is perfectly satisfactory to me to extend the tjme to»5 hours. Mr. TREADWAY. Mr. Speaker, reserving the right to object, I may say to the chairman of the committee that, so far as the minority is concerned, if, in order to accommo- date his colleagues, he desires to extend the time further, it is entirely agreeable to us. The time as allotted, 2 hours, so far as my present requests are concerned, will take care of the minority. Now. if the gentleman considers there is occasion to use more time in general debate, as long as it is divided in the same way as the 4 hours, it will be entirely satisfactory to me. Mr. McCLINTIC. Mr. Speaker, reserving the right to ob- ject, I may say that the chairman of the committee made the statement on the floor yesterday that the Government is losing revenue at the rate of three quarters of a million dollars a day; or, at least, it is losing a very large amount of money. If this be true, why can we not expedite the pas- sage of this bill and all of us withhold at least a part of our ammunition? Mr. KELLER. Mr. Speaker, if the gentleman will yield, as I remember it, the loss to the Government is about $416 per minute of this debate. The SPEAKER. Is there objection to the request of the gentleman from North Carolina that 5 hours be consumed in general debate, to be equally divided and controlled by the gentleman from North Carolina I Mr. Doughton] and the gentleman from Massachusetts [Mr. Treadway]? There was no objection. The SPEAKER. The question is on the motion of the gentleman from North Carolina. The motion was agreed to. Accordingly the House resolved itself into the Committee of the Whole House on the state of the Union for the con- sideration of the bill (HJl. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes, with Mr. Bankhead in the chair. The Clerk read the title of the bill. Mr. DOUGHTON of North Carolina. Mr. Chairman. I ask imanimous consent that the first reading of the bill be dis- pensed with. The CHAIRMAN. Is there objection to the request of the gentleman from North Carolina? There was no objection. Mr. DOUGHTON of North Carolina. Mr. Chairman, the bill, H.R. 6131, reported by the Committee on Ways and Means, is designed to increase substantially the revenues of the Government by imposing or adjusting taxes on certain alcoholic beverages the consumption of which is made legal in many States of the Union by the twenty-first amendment. This bill is primarily a tax bill dealing with the rates of taxes to be imposed upon certain alcoholic beverages. While there will doubtless be subsequent legislation neces- sary with respect to the different phases of the liquor sub- ject, your committee was of the opinion that on account of the serious need of additional revenues caused by our pres- ent economic condition it was essential to expedite the pas- sage of this legislation as much as is pri^cticable. The paramount thought in my mind in connection wi.h the enactment of this legislation is — and it was the thougnt of the Committee on Ways and Means — that it is essential that the taxes to be imposed on alcoholic beverages should not be too high in order that those who are engaged in the traffic or business legally may not be put out of business or have unfair competition by those who engage in the business illegally. Joint hearings were conducted for 4 days by the commit- tee from the Senate and the House Committee on Ways and Means. The joint committee had before it the report of the Joint Committee on Internal Revenue Taxation dealing with the subject covering many pages. This committee was com- posed of representatives of several departments of the Gtov- ernment which, no doubt, had made thorough study of the subject. Also witnesses appeared before the committee rep- resenting different interests connected with this bill. While some were in favor of much higher taxes than are carried in the bill and some in favor of very much lower taxes than that proposed in the report of the interdepartmental com- mittee, that committee recommended a rate of $2.60 por gallon. Their recommendation, however, was made on the theory that a portion of the tax collected would be dis- tributed or allocated to the various States. After giving diligent consideration to this subject, your committee were of the opinion that too many administrative difficulties were involved in the Federal Government collecting all the taxes and attempting to allocate or distribute a portion of the money to the various States. Therefore, after full consid- eration and discussion, the committee decided to impose only such tax as we thought the Federal Government alone would be justified in imposing. Sections 2, 3, 4, and 5 of the bill deal with rates on dis- tilled spirits in various forms. The important change is that which imposes a tax of $2 per gallon in lieu of $1.10 in the present law. This is fully set out in the committee report and the Members can find it very readily. This rate applies to whisky, gin, brandy, rum, and similar liquors, but not denatured alcohol for industrial purposes. That is left tax free. Sections 6, 7, and 8 provide for new rates of tax on wines, liqueurs, cordials, and grape brandy used in the fortification thereof. The rate of tax on wine with an alcoholic content of 10 percent and not over 14 percent is 10 cents a gallon; between 14 and 21 percent, 20 cents per gallon; between 21 and 24 percent, 40 cents per gallon; and above that there is the same rate of tax as carried on alcoholic liquors, namely, $2 per gallon. Mr. FTTZPATRICK. Will the gentleman yield right there? Mr. DOUGHTON of North Carolina, I will be glad to yield to the gentleman from New York. congressiona: :. record— house a is to a 94 Mr FTTZPATRICK. Wm It brought out In eommlttie what It coat to manufacture a gallon of ^jfl^o'' ,„,,. Mr DOUOHTON of North Carolina. There were various rtaternent. made on that subject, but I do ~>* *«l'f •J,^ . was any general agreement. It would depend, of coune. upon the cost of the materials and the price Ot ]a,hCT. iSere was considerable evidence, but nothing definite y agreed upon as to what would be the cost of manufacturing a gallon of liquor. Mr FTTZPATRICK. I understand it costs 50 cents manufacture a gallon. There is a tax of $1.10. That is total of $1.60. And they charge $24 a gallon. If that not racketeering. I do not know what is. Mr. BLANTON. WUl the gentleman yield? Mr. DOUGHTON of North Carolina. I yield to the gen- tleman from Texas. Mr. BLANTON. The purpose of holding hearings on tl us matter during vacation, and in introducing the bill on t tie first day and bringing the bill before the Committee of the Whole House for debate on the second day and passing it on the third day of this session, tomorrow, was to get the tjax money in the Treasury as soon as possible, was it not? Mr. DOUGHTON of North Carolina. Absolutely. Mr. BLANTON. There is other tax money that ought be in the Treasury now. I have in my hand a report o subcommittee of the Committee on Ways and Means wjth respect to reaching the tax evaders and removing the emption on tax-exempt securities, but there is no rec mendation made by the subcommittee, and there has been no bill introduced by the subcommittee, that does away with tax-exempt securities. We all have confidence in the gent le- man from North Carolina, and we all highly commend Urn for the splendid work he has done in the last Congress, as well as other Congresses, but I was just wondering what we may expect from the gentleman's committee at an early date in the way of legislation that does away with these tax-exempt stcvuities. which permit multimillionaires over all the United States to escape payment of taxes they ju! tly owe to this Government. Mr. SAMUEL B. HILL. Will the gentleman yield? Mr. rXJUGHTON of North Carolina. I 3^eld to the gsn- tleman from Washington. Mr. SAMUEL B. HELL. Of course, the gentleman ftom Texas understands that there are obstacles of a constitu- tional nature in the way of removing the exemption on securities. Mr. BLANTON. With respect to the securities thiim- aelves. of course, there is a constitutional obstacle in ihe way, but that can be gotten out of the way just as expec iti- ously as was the eighteenth amendment ; but I am speal ing Just now of the income from these tax-exempt securii ies. We do not need any constitutional amendment to get a vay from such exemptions, and I want the gentleman to di-ect his explanation to that questiMi. Mr. SAMUEL B. HILL. The Congress, of course, has the power as to Federal securities to say that they shall be subject to either normal taxes or surtaxes. We have ;er- taln securities that are subject to surtaxes, and the ques ;ion of whether we should extend that provision to future isiiues is a question that affected the operations of the Treasury Department in securing the fiuther credits necessary to meet the emergency situation now confronting us, and we I are awaiting recommendations from the Treasury Departr^ent and conferences with that Department before talcing further action. Mr. BLANTON. If the chairman will permit the observa- tion. I belieire the gentleman recognizes the fact that it is the Mntimetit of this House, including practically Member on the floor, that something ought to be done awar on this question. X believe if wt had up now a re tion propoetng Mich a eonstitutlonal amendment we i pas* it in almost Id minuter, and any leglalatlon that wi January 4 ery ght iJu- uld Id •Mk to rfacfh the Income from nuah Mwurittew, i b«l|#ve, eould be ptmod by thu Uout^ by an almont utmnimou« vote, Mr. «AMUS1< B HttL, The Committee on Wayw and Meftntf hM not y«K draf u^d the biU for a gonoral r«vt«ioh of tho admtniitratue provimutw of the revenue act Mr. BLANTON. But we may eitpect that soon? Mr. SAMUEL B. HILL. You may expect a bill feaWnf with those subjects and we will be guided by the situation as presented to us by the Treasury Department and by our own Judgment as to whether we will present this question of surtaxes on future issues of Government securities. Mr BLANTON. That is going to bring hope to the tax- burdened people of the United States who pay their taxes to the Government. . ,, . w-4 « Mr. TREADWAY. Will the gentleman yield for a brief. observation? Mr. DOUGHTON of North Carolina. I yield to the gen- tleman from Massachusetts. , . , * Mr TREADWAY. I think this is all out of place to a very large extent. We are considering a tax on liquor, and the gentleman from Texas [Mr. Blanton] is endeavoring to call attention to some methods of escaping taxation that are quite public. Of course, we know about them, but the next income-tax reports arc not due to be made until next March. This committee has been working very strenuously and very hard, and we cannot do but one thing at a time. It is im- portant to pass this bill now, while the subject matter that the gentleman from Texas brings up has to do with income taxes, on which reports are to be made as of March 15. Mr. BLANTON. Mr. Chairman, not all of these tax evaders live in Massachusetts. Mr. DOUGHTON of North Carolina. Mr. Chairman, we all appreciate and admire the ability of the very diligent gen- tleman from Texas, who is always on guard in behalf of the interests of the Treasury and the public, but unanimous con- sent was given by the House with the understanding that the debate this morning would be confined to the pending bill. We are getting into a prolonged debate here upon an irrele- vant matter, and I hope that such questions may be held in abeyance until a later hour, and I can assure the gentleman from Texas that the matter in which he is interested will receive proper attention by the committee. Mr. BLANTON. I have found out all I wanted to know. Mr. DOUGHTON of North Carolina. Section 9 of the bill deals with rates on fermented malt liquors, beer. ale. porter, and so forth. Under existing law. approved at the last ses- sion of the* Congress, the rate on beer having an alcoholic content above 3.2 percent was fixed at $6 per barrel, and beer 3.2 percent at $5 per barrel. Mr. CELLER. Will the gentleman yield for a question? Mr. DOUGHTON of North Carolina. Yes. Mr. CELLER. Was any consideration given to the propo- sition of having the rate at $5 or lower on beer of 3.2 percent and increasing the amount of the tax on beer of above 3.2 percent? Mr. DOUGHTON of North Carolina. Under the present law beer above 3.2 carries a rate of $6 per barrel, while 3.2 percent beer is taxed $5. This bill provides one fiat rate of $5 per barrel. Mr. SNELL. Will the gentleman yield for a short ques- tion? Mr. DOUGHTON of North Carolina. I yield to the gentle- man from New York. Mr, SNELL. As I understand, there Is nothing In this bill, except fixing the tax, and there is nothing in the bill so far as the future poUcy of the Federal Government is concerned? Mr. DOUGHTON of North Carolina. The gentleman from New York is correct. Mr. SNELL. Does the committee have In mind bringing in a bill in the near future with respect to the policy of the Oovemment with respect to such matters? Mr. DOUOHTON of North Carolina, We certainly have that in mind, and will doubtless do so at the proper time, Thr? revenue bill ts on*' of the thln«s that wlU receive early tt(t«'ntion and will »>*• bfoii«ht tip very ntxm. I will not mv tmmediMtfly, tnit li will rirftve early attftntion, Mr, miCAnWAY, If the «h»irm«n of ihe eommiftite will yield, U not nn answer to Ihn Inquiry of the gentlemtn from New York »>mn«what Involved in wtteth^r or not th« WayN and Memm Cotnmiilee haii jurlHdlctiun over the gen- 1934 CONGRESSIONAL RECORD— HOUSE 93 eral subject matter of the policy of the adminiitratlon In •uch matters? I know that question came up. Mr. DOUGHTON of North Carolina. I know there will be certain matters over which the Ways and Means Committee will have jurisdiction and which It will be necessary to take up, but, perhaps, not all matters relating to the liquor ques- tion. Some of those matters may come from the Committee on the Judiciary. Section 10 provides for a floor tax, so that all Intoxicat- ing liquors which have been taxed at existing rates will be subject to an additional tax in the hands of the manufac- tiu"er or dealer equal to the difference between the new rate and the old. Mr. O'MALLEY. Will the gentleman yield? Mr. DOUGHTON of North Carolina. Yes. Mr. O'MALLEY. Subsection (b) of section 9 repeals the tax on nonintoxicating liquors, which includes fruit juices. Mr. DOUGHTON of North Carolina. Fruit juices with less than one half of 1 percent alcoholic content ought not to be taxed. Mr. O'MALLEY. Most of these are used for making wine. Mr. DOUGHTON of North Carolina. Wine carrying a content of alcohol above one half of 1 percent is taxed by this bill. Now, I should like to state in conclusion that it was the intent of the membership of the Ways and Means Com- mittee to pass this bill as soon as possible. Every day that it is delayed the Treasury loses one half a million dollars. If after this legislation is enacted practical experience dem- onstrates that the taxes are too high or too low, the Con- gress can make any needed amendments. Mr. BRITTEN. Will the gentleman yield? Mr. DOUGHTON of North Carolina. I yield. Mr. BRITTEN. Is it the intention of the gentleman to pass this bill today? Mr. DOUGHTON of North Carolina. It is not. It is our intention only to finish general debate. We are hopeful that we may be able to pass it tomorrow. Mr. BRITTEN. It would seem desirable to pass it today if we are losing half a million dollars a day. Mr. DOUGHTON of North Carolina. I do not think it is expected that a bill of this importance should necessarily be passed in 1 day. Mr. BRITTEN. Will the gentleman yield further? Mr. DOUGHTON of North Carolina. Yes. Mr. BRITTEN. It is my impression that a great majority of the Members of the House will vote for the passage of this bill and do it as quickly as you will give them the opportunity. Mr. DOUGHTON of North Carolina. I assure the gen- tleman that we will expedite the passage of the bill as much as possible. Mr. TERRELL of Texas. Will the gentleman yield? Mr. DOUGHTON of North Carolina. I yield to the gen- tleman. Mr. TERRELL of Texas. I should like to ask the gentle- man if the members of the Ways and Means Committee were unanimous for the $2 tax? Mr. DOUGHTON of North CaroUna. I will state that th^ majority members of the committee reached a unanimous agreement. We decided that the $2 rate would be as nearly correct as we could determine. So far as the minority members are concerned, and they can speak for themselves, they did not either agree or dis- agree. They left it open. I do not know the position of the minority members. Mr. CELLER. Mr. Chairman, will the gentleman jrleld? Mr, DOUGHTON of North Carolina, Yes, Mr, CELLER. With reference to the $3 tax, I find, on page 330 of the hearings, a chart, no, 11, which was iub- tniit«d by th« intf^departmental committee, that th« pricf to th« reinWpr p^r aallon of Ifttal MplritM \n II 30, that ih« pfic« to th^ local ban\\9UUPr ppt anllon ia 13 30, $1 m^ti, and that thtf prit}9 to thi^ ofKarti/^d MyndU'dt^d iWpunl ir«d<'— that iff, th« orianiMfd nyndmitUi, iivh<*i'« th«y mum pny morf for protectlotv— is $420. If you superlmpoM on the legal cost of (1,30 a gallon to the retailer a tax of $3 a gallon, you make the price to the retailer 13.20 per gallon of legal liquor. This does not take into conaideratlon the State and municipal taxes. If that la so, if you leave it at the $2 rate, how Is the legal operator going to compete with the local bootlegger where the coat to Utter will be only $2.20? Mr. DOUGHTON of North Carolina. The premise is not conceded. That is an opinion. Mr. CELLER. These are ttgures put into the record by the experts. Mr. DOUGHTON of North Carolina. There are all kinds of experts and all kinds of figures. There is no certainty that these figures are correct. Mr. COOPER of Tennessee. Mr. Chairman, will the gen- tleman yield? Mr. DOUGHTON. Yes. Mr. COOPER of Tennessee. The gentleman from New York [Mr. Celler] should bear in mind that the hearings show, by all those who appeared before the committee in a position to give information on the subject, that your illicit liquor traffic is divided into two groups. One is the so-called " old-fashioned moonshiner ", who operates in a local community or in a given section. The experts gave the committee testimony to the effect that that was of negligible consequence, so far as the liquor traffic is con- cerned. That is the group of the illicit traffic to which the first figures quoted by the gentleman from New York relate. The great organized group of the illicit traffic, the proof shows, has an operating expense of $4.20 per gallon. Mr. CELLER. In other words, with a $2 tax the legal operator could compete against the organized ssmdicate, but he would still have considerable competition from the well- entrenched local bootlegger who could sell his wares more cheaply than the legal operator with the $2 tax plus his State and municipal and occupational taxes and Ucense fees. Mr. COOPER of Tennessee. He would have some compe- tition still, from a local standpoint, from the old-time moon- shiner, who existed long before prohibition and who pre- sumably may continue to exist, but that competition is confined to local communities, and the moonshiners are more or less local in their operations. The experts all testi- fied that their effect on the liquor traffic is really negligible: that it is the great organized group that we have to contend with in the question of rate fixing, Mr. CELLER. I find that in New York, for example, the legal operator is compelled to get two kinds of liquor. He gets his legal liquor from a rather limited supply, as there are small stocks on hand in this country, but in order to supply the demand he has to get illegal liquor, and he gets some of that from the great organized ssmdicate, but the most comes from the local bootlegger; and so I am inclined to doubt the conclusion of the committee that there is not so much of this local t)ootlegger stuff around in the various cities. There is very much in my city. Mr. COOPER of Tennessee. In that connection you do not have much of the old-time moonshiner there? Mr. CELLER, Oh, no. Mr. COOPER ox Tennessee. That is the point that I endeavored to make to the gentleman. The great bulk of this illicit traffic comes under the group that embraces the bootlegger and those who control the distribution of liquor, who buy It from some soiu-ce. not producing it locally as the moonshiner does. Mr, CELLER. But If we should reduce the tax to $1.10, the old preprohlbltion level, we will be able to compete with all classes of Illegal operators beyond question. Mr. McFARLANI. Mr, OhalmiMi, Will the gentleman yield? Mr, DOUGHTON ot North Carolina. Ym. Mr, M(^ARLANf!. I affl wondering how the tax provided in this bill ootnparifs with the tax in other oouniriee. Mr, DOUOMTON of North Carolina, The tttx M not m hiifh AN it to la other eeuntrlii, M«fttvi tUM not yirt dfttft^d lh« blU for » gtntrttl r«vt«io^ of tho ftdmtnutrftti;« provuiutw of th« r0V0nu« Act from N#w York orniMwhut UivolvwJ in whHhtr or not ihfl WiiyN lind MtrtitM CPtnmUi«« hiM JuriN4ictiun ov«r th« gtti- CONGRESSIONAL RECORD— HOUSE N 96 Mr COOPER of Tennessee. If the gentleman wiU mit in that connection the tax in England is $14 a gallo: and in Canada $7 a gaUon. and until recently it was $8. Mr DOUOHTON of North Carolina. We are legislating the United SUtes lor the United States. With respect to operations of the bootlegger and the Ulicit dealer, I am opinion that the bootlegger is going to find a much more c flcult road to travel in the future than he has m the rece past In the first place, the Federal Government will go af t^r him more aggressively and determinedly, in order to get revenue. Then the licensed dealer, in order to protect business, must make a fight upon him. and the States thkt impose a tax on Uquor will necessarily be dil«ent in thdir effort toward the suppression of the bootlegger in order lo protect their revenue. Between the three, the Federal '^ cmment, the Ucensed dealer, and the SUte govemmen the illicit dealer, in my judgment, is going to find it unpro"= able and hazardous to engage in that business. Moreover, when people desiring alcoholic liquor can purchase Icdal liquor many of them will not patronize the bootlegg*r Public sentiment will condemn such purchases. The m who patronizes the illicit dealer would be robbing the emment, and few people desire to do this. Mr. OIPPORD. Will the gentleman yield? Mr. DOUOHTON of North Carolina. I yield. Mr. GIFPORD. Having in mind the license fees to paid by municipalities and the distillers' tax probably to the States, did the gentleman have any evidence bef his committee of contemplated taxes per gallon by States? And in view of that evidence, does the gentlemi believe that that was the basis used in determining the pr Mr. DOUOHTON of Ncwth Carolina. It was not, becaise we had no definite knowledge of what taxes the varidus SUtes might impose, but we felt that the $2 tax would lea ve room for a reasonable State tax. Of course, if the StJ,te imposes a tax too high, it will drive the business to anotl er State or it will tend to encourage bootlegging. Mr. QIPFORD. Will the gentleman state to us what he would recommend as a satisfactory or reasonable tax to be Imposed by a State in addition to this $2? Mr. DOUOHTON of North Carolina. The interdepart- mental committee which made an examination and study of every phase of the matter recommended a total tax of $2.60. 20 percent of which would go to the States. If 1he genUeman will take 20 percent of $2.60, he will have the judgment of the interdepartmental committee, which is as sound as smy opinion we are likely to get. The States cm, in my (pinion, levy a tax of 50 or 75 cents per gallon wil h- out going too high. Mr. SAMUEL B. HILL. Will the gentl«nan yield? Mr. DOUOHTON of North Carolina. I yield. Mr. SAMUEL B. HILL. The Rockefeller Foundation re- port was $3 total tax. Mr. DOUOHTON of North Carolina. The Rockefeler Foundation report was $3 total tax, yes; and I understind that was on the basis that the Federal Qoyemment would receive about $2, and something approximating $1 would be allocated to the various States. Of course, the Federal O jv- cmment cannot decide what the States will do. but they will, in their Judgment, keep in mind the fact that If t|iey Impose a tax too high it will be difficult to collect, and t will be less consumption of legal Uquor, and they will receive less taxes than if we impose a reasonaMe tax. Mr. OIPFORD. Will the gentleman yield further? Mr. DOUOHTON of North CaroUna. I yield. Mr. GIFFORD. It seems the SUtes will have to Impose the leavings, whatever they may be. The protests wblch come to me are that the tax is too high, for the reason tnat there is nothing left for the State, and at the iH'esent mo- ment the desire to get rid of the bootlegger Is a great <|eal greato' than the amount of revenue concerned. Mr. DOUOHTON of North Carolina. There are those on this floor who believe $2 tax is too high. Others believe it is too low. There is no way of knciwing what the fuoure will determine about the matter, but the majority memtters January 4 of our committee thought that $2 was about the best levy that could be determined at present, and there was no par- ticular opposition from the minority m mbers of the com- mittee. If experience shows it is too high, we can lower it; if it is too low, we can raise it. Mr. COOPER of Tennessee. WUl the gentleman yield? Mr DOUOHTON of North Carolina. Yes; I yield. Mr COOPER of Tennessee. In further reply to the gen- tleman from Massachusetts [Mr. Gifford]. we must all bear in mind that prior to prohibition, all g-^llonage tax was levied by the Federal Government. Uceni>e fees and other taxes of that type were levied by States and local communi- ties. In the pending legislation the same policy is sought to be followed as obtained prior to prohibition. That is. have the Federal Government levy the gallonage tax. And the report of the committee shows that the levying of license fees and taxes of that type is still left to the SUte and local governments. Mr. CELLER. Will he gentleman yield? Mr. DOUGHTON of North Carolina. I yield. Mr. CELLER. Is it intended to impose any occupational tax at all? Mr. COOPER of Tennessee. Only a nominal rate that is now in existence; that is. simply for control or regulation purposes. Mr. CELLER. Under the Commissioner of Internal Reve- nue? Mr. COOPER of Tennessee. Yes; it is not increased. Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield back the remainder of my time. The CHAIRMAN. The gentleman from North Carolina has consumed 29 V^ minutes. Mr. TREADWAY. Mr. Chairman. I yield 10 minutes to the gentleman from Illinois [Mr. Dirksen]. Mr. DIRKSEN. Mr. Chairman. I either have the misfor- tune or the good fortune to represent the largest whisky district in the United States of America. I suppose it is something of a fortuity that I should represent a district that is at the present time producing approximately 16.000 cases of whisky per day. That means that I have a very definite interest in the economics of this bill, as well as the moral aspect which is designed to drive the bootlegger out of business. As I think of this taxing bill and think of the sentiment that was rampant in the country when we were convened in the special session of the Seventy-third Congress, I think you will admit there was a general consciousness of the people of this country and among those who sit in oflicial capacity in the SUtes and municipalities to hang the entire burden of government upon whisky and beer. I sun won- dering, as a matter of fact, whether that sentiment has not been encouraged and possibly carried to a point where it might be dangerous. It recalls two boys who were out on a raft after a shipwreck: One was at the oars rowing and the other was on his knees praying. TTiis boy who was on his knees supplicating the Almighty said, '* O Lord, if we might but sight a sail, we give Thee anything we have. O Lord, if we might but see a ship on the horizon, we give Thee everything we hope to accumulate." Here was his companion at the oars rowing and looking around, and sud- denly he saw a sail shimmering over on the horizon. He looked at his buddy and said. "Wait a minute. Don't promise too darned much. I think I see a ship." That is exactly what is happening among National, State, and county taxing bodies. They defer everything in the hope of hanging it upon whisky and upon sphits generally, that they may then carry the burden of government. Frankly. Mr. Chairman, I believe that $2 Is too high. It will be noted that the rectification tax of 30 cents a gallon remains in effect, so that for rectified whisky the United SUtes Ux will be $2.30. This must be considered also in the light of licenses which have been imposed by ordinances of municipalities which seek also, directly and indirectly, to impose a tax upon the liquor business, whether it is retail or wholesale. 1934 CONGRESSIONAL RECORD— HOUSE 97 Recall also that there Is a bill pending before the Commit- tee on the District of Columbia which is going to impose a Lcense fee of $1,500 per year upon the vendor of spirits and beer. Most of the States have gallonage taxes running from 25 cents to $2 per gallon; and down here in the Department of Agriculture, under the Agricultural Adjustment Adminis- tration, they have taken 75 cents per bushel as the base price of corn for processing into spirits. Whatever the dif- ference is between the market price of corn in Chicago and the 75 cents is the additional processing tax the distiller has to flip into the Agricultural Adjustment processing fund. Municipalities also will impose license fees. So, what is the result? It is a tremendous debt structure that has been piled upon the whisky and beer business, all because they think there is a great deal of profiteering. Well, if there is profiteering at the present time, if they are getting ex- orbitant prices for whisky, good whisky and bad whisky alike, we still have the possibility of imposing some kind of excess-profits tax and taking all these exorbitant profits away from the brewers and manufacturers, if necessary. What I am vitally concerned about is to put the bootlegger out of business and to keep him out of business. I wonder whether the Members of this House have a very finite con- ception of exactly how entrenched the bootleg business is in this country. The gentleman from New York TMr. O'Connor] came to my district this summer and helped lay the cornerstone of the world's largest distillery. I rather fancy the gentle- man from New York had an opportunity to visualize Just exactly what goes on back there in Illinois. I can speak from direct and personal experiences with this bootleg busi- ness, because I have seen lots of bootleggers. A great many of them are my own friends: and I am not hypercritical or ashamed about it, because they vote just like anybody else. [Laughter.] May I say to you that when Amos Woodcock was the Director of Prohibition — and everybody knows that he was an ardent dry — he made an estimate in connection with all the other experts in the Treasury Department to ascertain, if possible, and as nearly as possible, the amount of bootleg liquor that was being transported and sold and consumed in the United States of America. They traced, first of all, the available supplies of com sugar, cane sugar, beet sugar, grain, blackstrap, and other things that can be converted into spirits. After segregating all that which had gone into legiti- mate industry they made their estimates. Here are their estimates of the. bootleg liquor that was consumed in this country for the fiscal year ending the 30th of June 1930: Prom com sugar, mind you, my friends, 45.900.000 proof gallons. Write that down in the book. Prom cane and beet sugar, 10.000,000 gallons; from grain, 4,000,000 gallons; from diverted industrial alcohol, which is precipitated and rertm, 9,929,000 gallons; from smuggled sources, 3,557,000 gallons. So we had in this country for the fiscal year end- ing June 30, 1930, 73,000.000 gallons of bootleg booze. And do not think for n minute that the men in Chicago, Phila- delphia, New York, and elsewhere, who go out and mangle tliemselves with riot gvms, machine guns, and pistols; who made millions of dollars out of the booze racket; men who are tjrpifled by Al Capone— down in Atlanta — and others of these gangsters who have been hauled away in burnished silver caskets, no later than this summer in Chicago, are going to relinquish this thing without a struggle. How are we going to get at them? By piling up tremendous taxes? Certainly not. It will be by keeping the taxes down to the Irreducible minimum. Let us make it possible for the dis- tiller, the legitimate manufacturer, and the legitimate brewer to ultimately put him out of business. Mr, O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. DIRKS^. I yield. Mr. O'CONNOR. The gentleman has been lauding his distillers at Peoria. Mr. DIRK8EN. I beg pardon. I have done nothing of the kiiuL Mr. O'CONNOR. The gentleman has been talking about " legitimate " distillers. Does not the gentleman know that the bootleggers got most of their domestic supply from these very distillers he is talking about? Mr. DIRKSEN. I doubt it very much. I have heard the statement made time and time again, but it is Just one cf these wild conjectures so often arid so loosely uttered. Mr. O'CONNOR. If the gentleman will yield further, he can find out that the national distillers, for instance, who bought out the Overholt Distillery from the Mellons, sold millions and millions of gallons to the bootlegger. The boot- legger wsLs their biggest client. The distillers were not doing a legitimate business. Mr. DIRKSEN. That may be. but speaking for those who have been in the industrial alcohol business out in my dis- trict through the prohibition era. I may say that they were the very first to go to the Administrator In Chicago and complain whenever it came to their notice that there were illegal sources of supply in that particular area. Mr. O'CONNOR. Are there not distilleries in Peoria who have been selling their wares all during prohibition? They have sold it by the millions of gallons. They have es- tablished credits for bootleggers as high as a million dollars in some instances. Did they think that was legitimate liquor? Mr. DIRKSEN. They had to qualify under the rules, regulations, and requirements of the Treasury Department and make the necessary affidavits. Is it their business to inquire into the ultimate destination of that which is legiti- mately sold? [Here the gavel fell.] Mr. DIRKSEN. Mr. Chairman, I ask the gentleman from Massachusetts to yield me an additional 5 minutes. Mr. TREADWAY. Mr. Chairman, I yield an additional 5 minutes to the gentleman from Illinois. Mr. KENNEY. Mr. Chairman, will the gentleman yield? Mr. DIRKSEN. I yield. Mr. BaiNNEY. The gentleman has referred to bootleg liquor to some extent. Does the gentleman regard this liquor as good liquor? Mr. DIRKSEN. What liquor? Mr. KENNEY. The bootleg Uquor to which he referred. Mr. DIRKSEN. I may say to the gentleman from New Jersey that I regard that bootleg liquor as eminently su- perior to some of the junk we are drinking today. Mr. KENNEY. If that be so, I ask the gentleman does he object to the legalization of the present supply of illicit liquor, so as to give the Government some revenue from the liquor that is being sold and consiuned. whatever its quality may be, to which the gentleman has referred? Mr. DIRKSEN. The Oovenmient is never going to get a dime out of illicit liquor. Mr. O'CONNOR. Will the gentleman yield there? Mr. DIRKSEN. Yes. Mr. O'CONNOR. I understand from my research into this subject that the bootleggers cut their liquor about six or seven times, and, as Dr. Wynne, the health commissioner of New York, said, no bootlegger ever had the heart to sell the stuff that your Peoria distillers and national distillers and Schenley distillers are now selling. I was in Peoria. I made a speech in Peoria in which I denounced the distiller to his face worse than I shall ever denounce him here, and while there one of your distillers gave me something which he said was whisky and asked me to taste it. I had a hard time getting past the smell, and finally I said to him, " My Ood. what is this? " He said, " That is 3 gallons of wbiaky and 48 gallons of alcohol to the barrel." There was one of your distillers cutting it 24 times, whereas the bootlegger only cuts in five or six times. [Laughter.] Mr. DIRKSEN. I am afraid that— ehall I My the Inex- perienced taste of the gentleman from New York was not accustomed to the taste of good, midwestem whisky. [Laughter.] Mr. COOPER of Tennessee. Will the gentleman yield? Mr. DIRKSEN. Yes. Lxxvm- \ 98 CONGRESSIONA Mr COOPER of Tennessee. In Une with the discussicn between the gentleman from nilnois and the gentleman from New York, looking at it from a common-sense viev point for a moment. I assume there can be no doubt th^t the bootleggers now have the retail trade of the country Mr DIRKSEN. Well, judging from the number of boo ; leggers who operate in the House Office Building. I shou d say that is true. [Laughter.] . Mr COOPER of Tennessee. Without entering into any phase of the matter of that type, they have the distrib^ tion facilities now. Mr. DIRKSEN. That is partly true Mr. COOPER of Tennessee. With the distillers having t. le production facilities, let us just for the moment ask ou r fcelves this question. If one man had the production fac 1- ities and another had the distribution facilities, how lofcg would it take two such men to get together to do soihe business? 1 Mr. DIRKSEN. Does the gentleman suppose that tne legitimate distillers are not going to operate through legiti- mate reUil outlets, or does the gentleman suppose that ^e are going to sit supinely by and make no effort whatever *- RECORD— HOUSE January 4 to erad-cate the bootlegger and the gangster from this countrs?? Mr. DIES. Will the gentleman from Illinois 3^eld for] a question? Mr. DIRKSEN. I yield. Mr. DIES. I have listened patiently to the gentleman's speech and I should like to ask the gentleman what tax thinks would be reasonable. Mr. DIRKSEN. I think $1.50 per gallon would be amj^le Mr. DIES. If we levy a tax of $1.50 per gallon, w' assxirance do we have that the municipalities and the Sta ,es will not treble or quadruple that and thus defeat our pi|r pose? . ^ Mr. DIRKSEN. You have no assurance except that tie _ if Uncle Sam sets the pace for municipalities and the Stales, why should not they walk in wth $1,000 license fees and $2 gallonage taxes? We have already set the pace for thsm by hanging all the burdens of government upon whisky and beer, and they are simply following in our wake. Mr. DIES. But the gentleman heard the statement m!,de on the noor here that the $2 Ux does not compare with ihc tax imposed in Europe. Mr, DIRKSEN. Let me say to the gentleman from Teicas that I have heard there is a tax of $7 a gallon upon whi! iky in Canada, and it used to be $8. and I am wonder ng whether, as a matter of fact, the very fact there is a $7 ax is not the thing that has driven down consumption th»re and caused the Canadians to drink more wine, that does lot pay nearly the same rate of tax. Let me add this: In 1912 they had a population of se ren and a third millions in Canada and they consiuned abaut seven and two thirds million proof gallons of whisky. [Here the gavel fell.] Mr. FREAR. I yield the gentleman 5 additional minu;es. Mr. DIRKSEN. In other words, the per capita consump- tion in 1912 was 1.3 gallons. In 1914 it was 1.1 gallons. In 1917 it was 0.7 of a gallon, and in 1925 it was 0.225 df a gallon. Notice how consumption has dropped. They have gone over to consimiing more wine, and I wonder if the tax vas not the thing that cut down the consumption of liquor. Mr. CELLER. That includes also the consumption of liquor by the American tourists. Mr. DIRKSEN. Yes; almost half of the provincial reve- nue is from that source. Mr. DIES. But the gentleman certainly sees a difference between a $2 tax and a $7 tax. Mr. DIRKSEN. Certainly, We have two things to keep in mind: First of all. to satisfy the requirements of reveiue, and. secondly, to eliminate the bootlegger. In order to satisfy the requirements of revenue you it ust have consumption of legal whisky. If they do not bus it, there will be no revenue to meet the requirements of the Budget. You have also to consider it in the light of different con- ditions that obtain at the present time. Proponents of a $2 tax go back into the past and talk about 1912. 1914. and 1917. The buying power was different in this country at that time. We did not have a lot of C.W.A.'s and P.W-A.'s and a lot of other agencies to try to rebuild and rehabili- tate the purchasing power at $15 per week. You are putting on this tax and loading up liquor at the present time when the buying power of the country is perhaps at its lowest for a long, long time. Do you think these people can go out and pay a rather exorbitant price for whisky? Do you think they are going to pay this price, including this gallonage tax, and put this money into the Treasury of the United States when they can slip around the corner and buy it from a bootlegger? I doubt it very much. Mr. O'CONNOR. Will the gentleman y.eld? Mr. DIRKSEN. I yield. Mr. O'CONNOR. The gentleman will admit, I am sure, that when they are paying $60 and $70 a case for his Peoria rum today, and the tax is only $1.10, they are certainly paying an exorbitant price, Mr. DIRKSEN. Let me say to the gentleman from New York, and for the information of everybody in the Chamber, that you can buy whisky in my district in carload lots as low as $13.10 a case. Mr. O'CONNOR. That must be cut 50 times. [Laughter.] Mr. DIRKSEN. Well, they drink it just the same. Mr. COOPER of Ohio. Will the gentleman yield? Mr. DIRIiSEN. I yield. Mr. COOPER of Ohio. The gentleman states that the tax on the consumption of liquor in Canada from 1917 to 1925 declined. Does he attribute that to the high tax? A great many of the Provinces of Canada had prohibition, and therefore they had no record of how much illegal liquor was consiuned. Mr. DIRKSEN. That doubtless enters into it, but the high tax increased wino consumption. Mr. CELLER. Will the gentleman yield? Mr. DIRKSEN. I yield to the gentleman from New York. Mr. CELLER. There is very little demand for whisky in Canada, and a great many of our merchants have gone up there to buy the surplus. What we are trying to do is to eliminate the bootlegger. Mr. DIRKSEN. Now, I want to give you some compara- tive figures. These are figures on the consumption of liquor in this country. In 1900 the consumption was 97,000.000 gallons. In 1910 the consumption was 133,000.000. In 1914 the consumption was 143,000.000. In 1917 the consumption "was 147,000,000. If you will look at the bootleg supply of 73,000,000 gallons in 1930, you will find that the bootleg liquor amounted to 50 percent of the total consumption in this country at its peak in preprohibition days. So we want this tax brought down to where the bootlegger carmot exist. Mr. SAMUEL B. HILL. Can the gentleman state what the price of bootleg liquor is? Mr. DIRKSEN. Well, I can state what it is in the city of Washington, where quotations are common. I think you can buy bootleg liquor here for $1.75 a quart. Mr. O'CONNOR of New York. If you can buy bootleg for $1.75 a quart, will the gentleman explain why they are pay- ing $6 a quart for Peoria rum? Mr. DIRKSEN. I think the distinguished gentleman from New York was stung by some of the liquor dealers out there. [Laughter.] [Here the gavel fell.] Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield 15 minutes to the gentleman from Washington [Mr. HlLLl. Mr. SAMUEL B. HILL. Mr. Chairman, the members of the Committee on Ways and Means in approaching this question of the rate of tax on liquor had two principal 1 factors to consider, just as all Members of the House have I two factors to consider in reaching their own condusioDa i tiu\ roNaRESSIONAL RECORD— HOUSE January 4 1934 CONGRESSIONAL RECORD—HOUSE 99 as to what is the proper rate of tax to be imposed on intoxi- cating liquors. In the first place, we are, of course, all interested in eliminating the bootlegger at the earliest pos- sible time, and, in the second place, we are vitally interested in securing as much revenue for the Federal Treasury sis possible from this new source of revenue. That same senti- ment of eliminating the bootlegger and getting as much revenue as possible consistent with a tax rate that will eliminate the bootlegger has come down, of course, from the executive department, and from the interdepartmental com- mittee appointed by the President to consider informally this subject, and by the Rockefeller Foundation, and by all other organizations that have studied the question. All have approached it from the same standpoint — first, to eliminate the bootlegger, and, secondly, to get as much revenue as possible. All the advice that we have had from those who have given study to it in a systematic way goes to a rate of tax between $2 and $3 per gallon. Gentlemen recall the proposed plan of having the Federal Government collect all of the gallonage tax and then making an allocation of a certain percentage of that tax to the States upon some basis to be agreed upon for such allocation. The interdepart- mental committee referred to, which was appointed by the President, recommended a $2.60 tax to be collected by the Federal Government, 20 percent of that tax to be allocated to the various States entitled to such allocation under the plan to be adopted. The Rockefeller Foundation in its re- port recommended a maximum tax of $3 per gallon, to be collected by the Federal Government and allocated to the States upon a basis not exceeding 25 percent, so that there would be no gallonage tax levied by the States. But all of these agencies that have studied the question, all of these men who have studied it from the standpoint of economics, from the standpoint of revenue, have placed their figures between $2 and $3 per gallon tax. Some members of our committee felt that $2.20 per gallon would be a proper rate of tax. provided we made no allo- cation to the States. Some members of our committee thought that a lower rate of tax should be imposed. We finally agreed that $2 per gallon would be an equitable tax to be placed upon distilled spirits and would enaUe the legitimate producers and dealers in intoxicating liquors to compete successfully with the illicit traffic in that com- modity. Before the repeal of the eighteenth amendment the appeal went out to the country that we should repeal the prohibi- tion amendment for the two purposes — first, to eliminate the racketeering and bootlegging and all criminal acts which have grown up as a result of prohibition; and. secondly, to get the greatest flow of revenue from liquors we could legitimately: and the question of revenue was stressed. The country was sold to the idea that the burden of tax would be greatly relieved if we had this liquor to tax and to supplement the revenues so badly needed in our Federal Treasury. The question is. Can the legitimate trade in distilled liquor at a $2 -tax per gallon survive? Every witness who appeared before our committee who testified to the cost of producing a gallon of whisky put that cost at about $1 or $1.20 per gallon in the hands of the wholesaler. That is, that was the cost of producing liquor and getting it into the hands of the wholesaler. Some of them included in that $1.20 a gallon cost the profits which would come throughout the transactions down to and including the retailer; but we will accept the general opinion of those men who testified as to the cost of producing a gallon of whisky at $1.20 a gallon in the hands of the wholesaler. Mr. BLANCHARD. Mr. Chairman, will the gentleman yield? Mr. SAMUEL B. HILL. Yes. Mr. BLANCHARD. In order to inquire if the cost was figured for real whisky or on blended whisky? Mr. SAMUEL B. HILL. The cost was figured on straight whisky. That would be 30 cents a quart. A tax of $2 a gallon would be 50 cents a quart tax. There you would have an 80-cent cost for your liquor in the hands of the whole- saler. If that quart of liquor is sold for $1.50. that would be a 70 -cent margin of profit, including the cost of handling from the wholesaler to the retailer and to the consiuner; and I believe that it cannot be gainsaid that 70 cents a quart mtirgin above the cost of the tax and of manufacture is a reasonable profit. Mr. BRITTEN. Mr. Chairman, will the gentleman yield? Mr. SAMUEL B. HILL. Yes. Mr. BRITTEN. The gentleman, of course, is entirely cor- rect in what he says, but his premise does not appear to me to be quite accurate. He is forgetting the State, county, and city taxes that would be levied in every community in the United States; and. of course, they will vary. The Dis- trict of Columbia is arranging for a very heavy retailer's tax, a consumption tax, which the gentleman's figures do not include. Mr. SAMUEL B. HILL. That is true: and. if we levied a 50-cent tax per gallon, the States would levy a $2 tax per gallon. Mr. BRITTEN. Probably. Mr. SAMUEL B. HILL. There is no question about that. Are we going to retire from this taxing field? Up until the time of prohibition the gallonage tax was the exclusive field of the Federal Government. Now the States are com- ing in and levying gallonage tax, and to t;he extent that we reduce the gallonage tax for the Federal Government just that much greater will be the gallonage tax placed thereon by the States. We cannot control that; and unless we are prepared to retire from this field and leave it to the States, then we are justified in levying a tax upon intoxicating liquors that of itself and by itself will be considered a reasonable tax and will bring to the Treasury a reasonable amount of revenue. Mr. BLANCHARD. WiU the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr. BLANCHARD. Did the committee give any con- sideration to the idea of placing a Federal tax on Uquor and returning a portion of that tax to the States and munici- palities? Mr. SAMUEL B. HILL. The committee gave very serious consideration to that question, and the committee was un- able to agree upon any ba^ of allocation. It seemed some- what ideal in its aspects. We felt if we could confine the taxing of intoxicating liquors to one tax, and that levied by the Federal Government with the condition that a cer- tain portion of it be allocated to the States, we might go a long way toward solving the proposition of a reasonable tax. Mr. JENKINS. Will the gentleman jdeld? Mr. SAMUEL B. HILL. I yield. Mr. JENKINS. Is it not a fact that all the testimony before the committee indicated clearly tliat the only reason- able tax which the Government could levy was this gallon- age tax? In other words, the Government could not, with satisfaction, enter any other field of taxation except the gallonage-tax field? Mr. SAMUEL B. HELL. The gentleman is entirely cor- rect in that, and we did not invade any other field. We confined our action to levying the gallonage tax. Mr. CELLER. Will the gentleman yield? Mr. SAMUEL B. HILL, I yield. Mr. CELLER. I understand the principle is to keep the tax so low that you will be able to fight off the well- entrenched bootlegging iiuiustry. The battle will be all the stronger between the legal industry and the illegal industry in the first few years. Did the committee consider a sort of inrc«ressive tax, a very low tax the first year, a slightly higher tax the second year, and then up to $2 the third year? By that time you will, by virtue of the advantage you give to the legal trader with the low tax, have destroyed the illegal industry. Mr. SAMUEL B. HILL. I may say the committee gave consideration to that question, and the committee decided it would not be a very wholesome thing, from the stand- point of law enforcement, to advertise to the bootlegger that we are simply postponing the time when he can come in with high-priced Uquor and compete with the legitimate 100 trade. In other words, if we have a low tax this year, the bootlcRger may hold off. provided he is notified in advanie that next year the tax will be high. Mr CELLER Would not the organized traffic get stronger In the interval? They wiU be supplying the demand a^d getting the trade and thus oust the legal trader. Mr. SAMUEL B. HILL. There is some force to the gen- tleman's argument. Mr. TAYLOR of Tennessee. Will the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr TAYLOR of Tennessee. Prior to the adoption of t tie eighteenth amendment did any of the States levy a tax upjon liquor? ... Mr. SAMUEL B. HILL. None that I recalL It is possible that Indiana did have such a tax. J Mr. TAYLOR of Tennessee. There was nothing to prevent them from doing that. Mr. SAMUEL B. HILL. Nothing at all. They simply cc n- fhied themselves to levying a Ucense tax and occupatio^l tax. Bir. TAYLOR of Tennessee. A privilege tax Mr. SAMUEL B. HILL. That is correct. Now, I want take Dr. Doran's testimony before the committee; ant CONGRESSIONAJL RECORD— HOUSE January 4 to I have modified his figures a Uttle. beca'ise he was basingjiis calculations upon a proposal to tax liquor at $2.60 was the proposal of the interdepartmental committee; b am taking the figure of $2 a gallon instead of $2.60. using his highest cost figures. Dr. Doran, whom yo" JaU know, and in whose judgment you have confidence on tihis particular subject, stated that a tax of $2 would be $ case. There are 3 gallons to the case, as I imderstand it. He said it would cost five or six dollars to produce a cise of whisky. I took $6 and used that figure as the higtest figure. That would be $6 a case for producing the whisky. We then have the cost of producing the whisky and the tax totaling $12 a case. This case is sold for $18, and theri is $6 margin, or $2 a gallon profit, or 50 cents a quart profit. Mr. O'CONNOR. WiU the gentleman yield right thete? Mr. SAMUEL B. HILL. I yield. I Mr. O'CONNOR. Before prohibition, of course, a distiller did not make any $2-a-gallon profit. If he made 5 or 10 cents, he thought he was very fortunate, and the gentleman never heard of a distiller who was not a millionaire. Mr. SAMUEL B. HILL. That is true. Mr. O'CONNOR. Of course, the gentleman knows whit I am trying to do is to have more of that $2 profit for the Government. Mr. SAMUEL B. HILL. I appreciate that. The CHAIRMAN. The time of the gentleman from Washington [Mr. Samtjel B. Hill] has expired. Mr. DOUGHTON. Mr. Chairman, I yield the gentleiaan from Washington 5 additional minutes. Mr. SAMUEL B. HILL. There was evidence before our committee that in preprohibition times many of the iis- tillers were operating on a margin of 5 or 10 cents a gal Ion, and most of them were making money. J Now. that brings me to this question: There is no abso- lute relationship between the amount of tax and the nrice which the consumers pay for liquor which they consime. I made inquiries in Silver Spring, Md.. where they tiave a liquor store. They have a State tax of $1.10, and we have a Federal tax of $1.10 at this time, and that liquor was selling for as high as $7.30 a quart, with only $2.20 tatal tax per gallon. You are not going to eliminate the bx)t legger simply through taxation, simply through the rat; of tax that you levy. It is true, if you put the rate of tax too high, it will not eliminate the bootlegger. However, ] do not agree with my friend from New York that $5 is a Rea- sonable tax. I think it is too high; but his argument is sound as to the relationship between the tax and the post of liquor. In other words, the cost of liquor is not determine^ in a major way by the tax imposed. Mr. KNUTSON. Mr. Chairman, will the gentleman yijeld? Mr. SAMUEL B. HILL. I yield. Mr KNUTSON It was one of the aims of the committee to keep the tax down to a point where it would be possible to seU whisky at retail at $1.50 a quart or less. Mr SAMUEL B. HILL. That is right. It was the testi- mony of the representative of a distillery in Kentucky who appeared before the committee that whisky could be pro- duced in an up-to-date, modem distillery, using modern methods, at 26 cents a gallon with a good profit. Other witnesses testified that the manufacture of whisky could be had at a cost of 30 cents or 40 cents a gallon. The outside figure was $1.20. So. I say, Mr. Chairman, that with a $2-per-gallon tax these distillers, these producers, can put out a good quality of liquor at a reasonable price, at a price not exceeding $1.25 or $1.50 a quart. All this talk about get- ting the tax down to $1.75 or $1.50 a gallon is simply an appeal by these producers to widen by that much their ab-eady great margin of profit. Mr. O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr O'CONNOR. Does not the gentleman believe, in Ijne with what he has just said, that if there were no tax at all on liquor today— and it is only $1.10— the price would be just as high as it is today? Mr. SAMUEL B. HILL. That is true. There must be some other control methods. Mr. SISSON. Mr. Chairman, will the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr SISSON. Did not the committee take testimony as to the price now at which the distiller is legally furnisliing whisky— that is, either straight whisky or blended whisky? Mr. SAMUEL B. HILL. The cast to the distiller? Yes. We have testimony to the effect, generally speaking, that it ranged around $1 to $1.20 a gallon, but none of it went higher than $1.20. Mr. SISSON. Is the gentleman famihar with the *act that the druggist, the legitimate druggist, purchasing legiti- mately, is obUged to pay for straight whisky from $30 to $36 a case— in other words, $3 a quart— and for blended whisky $2 to $3 a quart? Mr. SAMUEL B. HILL. I have understood that is true. Mr. SISSON. One further question: Is it not the opinion of the gentleman and the gentleman's committee that the distiller at the present time is getting an exorbitant profit, four or five times as much as he is entitled to? Mr. SAMUEL B. HILL. Somebody is getting it. I do not know who it is. Mr. COOPER of Tennessee. Mr. Chairman, will the gen- tleman yield? Mr. SAMUEL B. HILL. I yield. Mr. COOPER of Tennessee. The gentleman will recall, I am sure, that the witness from Kentucky, who testified and gave some rather valuable information to the committee, stated, and it is in the record, that he would be willing to enter into a contract to deliver the old standard brands and qualities of whisky for $5 a case. The gentleman recalls that statement, does he not? Mr. SAMUEL B. HILL. I recall it. It is absolutely correct. [Here the gavel fell.] Mr. SAMUEL B. HILL. Mr. Chairman. I ask the gentle- man from North Carolina to yield me a little more time. Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield 5 additional minutes to the gentleman from Wash- ington. Mr. DIRKSEN. Mr. Chairman, will the gentleman peld? Mr. SAMUEL B. HILL. I yield. Mr. DIRKSEN. Would it not be proper in making any observation upon the cost of so-called " good whisky " here in the East, to say that, for the fiscal year there was avail- able only 1,000,000 gallons of 4-year-old whisky, if I re- member Dr. Doran's figures correctly; and that this whisky standing in the warehouse had shrunk — that there was less — that it had to be regaged; and that by the time one fig- ured the investment in the warehouse and everything, that perhaps it was not so greatly out of line at this particular time, with a limited supply. 1934 CONGRESSIONAL RECORD— HOUSE 101 Mr. SAMUEL B. HILL. Do not take all my time, idease. Mr. DIRKSEN. That is all I wished to say. I merely wanted to get this observation in the Record. Mr. SAMUEL B. HILL. We are faced with a very vital question. We heard read this morning the President's mes- sage, in which it was stated that within the next 6 months we shall be faced with the necessity of borrowing new money to the amount of $6,000,000,000 and the refunding of $4,000,000,000 of outstanding obligations. When we borrow this $6,000,000,000, we must be prepared to meet the service charge upon it. It will be recalled that in the last session of Congress when we borrowed $3,300,000,000 under the author- ity of the N.R-A.. we had to provide from taxes a fund of $227,000,000 to meet the interest and sinking fund upon that borrowing. We are now confronted with this staggering amount of $6,000,000,000, which the President says we must borrow; and we must also service this amount of new bor- rowings which the Gtovemment will be forced to make. It will require at least $400,000,000 to service it, and we have not got the taxes at the present time to provide the money. We have read the newspapers. We have kept up with the condition of the Federal Treasury. We are at this time running over a billion dollars behind the current receipts, yet we have got to meet these additional expenses- necessary to service this $6,000,000,000 of new borrowings. Now, are we going to make liquor stand its share or are we going to place the entire burden upon other commodities? Are we going to search for other sources of revenue? We have here an opportunity to get a considerable portion of it fr«n intoxicating liquors. I think your constituency, and my constituency, and the country at large, will respcmd more gladly to the idea of placing this burden upon liquor than placing it on gasoline or some other commodities used in everyday life, thereby increasing the already great burden upon the peojde through the collection of these additional taxes. I think I know the sentiment of this House toward a sales tax. If we have to levy more taxes to meet the additional expenditures of this Govemmment, it seems to me we may have to resort to some such scheme as that. We must have this money, and we must get it from some source. Are we going to make liquor bear its proportion of this burden to the fullest extent possible in keeping with the primary idea of stamping out the bootleg industry? We can do this by levying a tax of $2 a gallon on whisky. Mr. CELLER. Will the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr. CELLER. I think most of us will agree with that fundamental principle; but the question is whether $2 would not be too high, and in that connection let me call the gentleman's attention to page 314 of the hearings in con- nection with what the gentleman said, namely, that the amount of tax has no appreciable relation to selling price. I find these facts: The United Kingdom hsw Increased the tax on distilled spirits at different times from $2.62 in 1914 to $12.88 in 1922 per United States proof gaUon. As shown in table 2. the consumption vaa reduced as the rate of tax increased. Mr. SAMUEL B. HILL. Everybody recogniz^ that prin- ciple. The CHAIRMAN. The time of the gentleman has again expired. Mr. DOUGHTON of North Carolina. I will yield the gen- tleman 2 additional minutes. Mr. SAMUEL B. HILL. Mr. Chairman, when the eight- eenth amendment was repealed, the President issued a proc- lamation which eliminated from our tax structure four items of excise taxes, carrying an estimated revenue of $227,000,- 000. That $227,000,000 must be made up out of the revenue from liquor. In addition to that $227,000,000, we have to make up an additional $400,000,000, or thereabouts, of new revenue in order to take care of the servicing of this prospective borrowing of $6,000,000,000 within the next 6 months. I appeal to you to place upon liquor this tax of $2. Do not be carried away with the idea that yen must iriace the tax at $1.50 or $1.75 in order to let legitimate traffic survive. Mr. TREADWAY. If the gentleman is inrssed for time, I shall be glad to yield him some of my time. Mr. SAMUEL B. HILL. I should be glad to have 5 or 10 minutes more. Mr. TREADWAT. I shall be glad to yield the gentleman 10 minutes of my time. Mr. DIRKSEN. Will the gentleman yield? Mr. SAMUEL B. HILL. Yes; but do not make a speech. Mr. DIRKSEN. The gentleman does not forget that when they imposed added postage revenue and nuisance taxes the aggregate revenue returned was altogether disappointing, as indicated by the fiscal record? Mr. SAMUEL B. HILL. Yes, sir. Mr. DIRKSEN. This same thing might apply here? Mr. SAMUEL B. HILL. Oh, yes; it would apply if you made the tax too high. I agree with that. I am saying, however, that $2 is a very moderate tax. This traffic will stand $3 per gallon and permit the sale of whisky at $1.50 a quart if you do not insist on too wide a margin of profit for the industry. Mr. WHITTINGTON. Will the gentleman yield? Mr. SAMUEL B. HILL. I yield to the gentleman from Mississippi. Mr. WHI'ITINGTON. Is it the gentleman's view; and the view of the committee, that the adoption of the twenty- first amendment repealed the provisions of the Volstead Act, as well £is the provisions of the beer bill, prohibiting the sale of intoxicating liquors generally? Mr. SAMUEL B. HILL. Yes; it repealed all that part which had to do with prohibition. Mr. WHl'l'l'lNOTON. There were certain provisions in connection with the Volstead Act that were of a permanent character and which did not rely on the eighteenth amend- ment. I refer to the prohibition concerning sale, manufac- ture, and transportation. Mr. SAMUEL B. HILL. That is right. Mr. WHITTINGTON. And it is the gentleman's view, and, as I understand it, the view of the Attorney General, that the adoption of the twenty-first amendment repealed tJbe prohibition provisicms? Mr. SAMUEL B. HELL. In the main, it repealed the Volstead Act. Mr. O'MAT.T.FY. Will the genUeman yield? Mr. SAMUEL B. HILL. I yield. Mr. O'MALLEY. The gentleman from Illinois [Mr. DraK- sek] thinks the tax upon liquor should be low enough to stimulate its consumption. I do not think that was the purpose of repeal. Is there any valid reason why we should consider, in discussing the tax on liquor, the failure of the Government to exercise its police powers? Mr. SAMUEL B. HILL. None at all. The gentleman is correct in that; but, of course, the rate of tax has some influence on the volume oi consumption. Our experts have made various calculations and have sdbmitted estimates, and at the $2 rate they estimate there will be a consump- tion of 150,000.000 gallons of domestic liquors Mr. BOLAND. Will the gentleman yield? Mr. SAMUEL B. HILL. In Just a moment I shall be pleased to yield. Probably 20 or 25 million gallons of imported liquors for the first year. We expect from this a revenue of $375,000,000. We expect from wine something like $10,000,000 of revenue, which will bring us approximately $400,000,000 of revenue from dis- tilled liquors and wines. We are not taking into consideration in this calculation the beer tax, because we have that already, and that is now going into the Treasury. It runs around $135,000,000 to $150,000,000 a year. So we will have from the taxes on liquors of all kinds approximately $600,000,000 a year of revenue, but we need much more revenue than that to balance our Budget, and we cannot afford to reduce this tax to the point where we CONGRESSIONAL R 102 are sacrificing revenue. We must put the tax at the point where it will bring in the maximum amount of revenue con- sistent with stamping out the bootlegger, and we think we have gone just as far as we can go. although a higher rate might bring in a little more money than the $2 rate. Mr BOLAND. The gentleman made the statement a mo- ment ago that you could tax liquor $3 a gaUon and still sell it for $1.50 a quart. I am wondering if the gentleman takes into consideration the State tax that has been placed on liquor by the State legislatures, and whether the gentleman knows anything about the pohtical hierarchy that has been built up in the State of Pennsylvania through the State liquor stores by the Pinchot organization. Mr. SAMUEL B. HILL. I am talking about Federal taxes. Of course, you could leave the whole question of taxation to the States, and they might put on a $3 tax. but if you re- duced the Federal tax to 50 cents a gallon, then the SUtes would probably come in with a $2 or a $2.50 tax. The State of Pennsylvania, as I understand it, at the present time has a floor tex of $2 a gallon, and has practically paralyzed the business there for the present. Mr. BOLAND. And. of course, they have established a political hierarchy that the gentleman knows about. Mr. SAMUEL B. HILL. But the point is that somebody is going to levy a tax on liquor, and is the Federal Govern- ment going to get in on it or are you going to leave it en- tirely to the States? Mr. O'CONNOR. Will the gentleman yield for a question along the line of the anticipated revenue? M-i. SAMUEL B. HILL. I yield to the gentleman from New York. Mr. O CONNOR. As the gentleman will recall, in antici- pating the revenue from beer, the consumption, as I recall, in 1918 was 68.000.000 barrels. The Treasury ofBcials figured that the consumption would never be the same, but would be greatly reduced, and I agree that that opinion was cor- rect. So they took a figure of 30.000,000 barrels and esti- mated that at $5 a barrel it would raise $150,000,000. I understand this estimate will not be far out of the way, and instead of a consumption of 68.000.000 barrels of beer we will only have a consumption of 30.000,000 barrels of beer. Now as to apiritous liquors. I believe that the consump- tion will not be. at most, over one half of what it used to be. Will the gentleman tell me whether or not in considering the anticipated revenue at $2 he has taken one half of the old consumption, or what figure has been taken? Mr. SAMUEL B. HILL. No: we have not taken that. Of course, in 1912, 1913, and along in there, we were consuming about 140.000.000 gallons a year, and in 1916 and 1917 it went up to about 164,000,000 gallons a year. Mr. O'CONNOR. At $2 a gallon I understand the gentle- man expects to raise $350,000,000 from spiritous liquors. Mr. SAMUEL B. HILL. That will include customs duties also. Mr. O'CONNOR. How many gallons does the gentleman estimate? Mr. SAMUEL B. HILL. We estimate 150,000.000 gallons at $2, which will be $300,000,000. and then we estimate we will probably get $75,000,000 more from customs, making a total of $375,000,000. Mr. O'CONNOR. I am afraid the gentleman is going to be disappointed, and I am for a high tax to get the revenue. Mr. SAMUEL B. HILL. I agree that other estimates are lower, but they are all estimates, of course. Mr. O'CONNOR. In my opinion, you will never get $375,000,000 from spiritous Uquors unless you have a tax of at least $5. Mr. SAMUEL B. HIT J.. But you would cut down the consumption. Mr. O'CONNOR. Do not worry about that for the first year. The people will have to have it the first year. Mr. SAMUEL B. HILL. I agree with the principle under- lying the statement of the gentleman from Illinois as to the relationship between price and tax. but I think he is going too strong on the matter of tax. I think $2 a gallon ICORD— HOUSE January 4 is a reasonable tax, a very moderate tax, and I beUeve the U< uor traffic can stand it and stamp out the big bootlegger, ai d I appeal to the membership of the House to put that tax in this bill. I assure you we have given this matter very se rious consideration. I am not asking you to take our judg- ment alone. Your judgment is as good as ours, but we hnve had the privilege of having before us those who have studied this matter from the standpoint of the economics involved and from the sUndpoint of sociology and from all iti various angles, and when we considered it on the basis ol all the information we have, we feel that a tax of $2 a ghUon is a reasonable tax and will probably bring in the ghest amount of revenue to the Govemmenc and will h^lp us. to that extent, in balancing our Budget. Mr. CELLER. Will the gentleman yield for a brief ques- tion? Mr. SAMUEL B. HILL. I yield. Mr. CELLER. Did the committee consider the matter of hliving freer importation of whisky in order that we might t better whisky drunk in this country? We have only lOO.OOO gallons of old whisky. I understand. Everything e is young and therefore very immature and bad for the health of the Nation. Should there not be some method by .ich we could get better whisky and get it from sources at now have it. namely. Canada. England, and others? Mr. SAMUEL B. HILL. We considered the matter from lat angle. It is a matter of general knowledge that the iii porters are moving heaven and earth to get import qjotas. They are going to bring in all the ouside whisky tiat will be permitted, and we think that for the first year Me will get all the imports possible at the rate of $5 a gal- lon, plus the internal tax of $1.10 or $2. whichever may be t le final action of the Congress, and thereby replenish our Tfreasury to that extent. After that time the tariff tax may have to be reduced. Mr. COOPER of Tennessee. Will the gentleman yield? Mr. SAMUEL B. HILL. I yield. Mr. COOPER of Tennessee. After all is not that quan- t: ty fixed by the Federal Alcohol Control Administration? Mr. CELLER. Does not the gentleman think that there oight to be more liberality in that regard? We know that V e have not enough old and mature whisky and we need it, and if you limit the quantity to be imported the American public will have to suffer. Mr. COOPER of Tennessee. If the gentleman Is correct i:i his statement, that is not to be done here under this till, but it is under the control of the Federal Alcohol Con- trol Administration? Mr. CELLER. But the Federal Alcohol Control Adminis- tration have narrowed the quantity to a point where it is I legligible. Mr. SAMUEL B. HILL. There are 25.000.000 gallons of ^ ,'hisky in Canada, and no doubt a great part of that whisky uill come into the United States for the purpose of being split twice, or perhaps 24 times, as the gentleman from New Tork says. Mr. CELLER. I understand that they are having great ifficulty in bringing it into the United States. Mr. SAMUEL B. HILL. I think that difficulty will be oned out. and it will come in. Mr. CELLER. I do not wish to blame the Federal Alcohol 'ontrol Administration. I think it is doing a good piece of ork. but Congress ought to have something to say about it. longress ought to say to them that they should be more iberal. Congress might well direct the Roosevelt adminis- xation to increase the whisky imports. Under the narrow imits laid down by the Administration, Mr. Choate and his ;olleagues are doing a fine piece of work. They should be :iven greater latitude, greater liberality as to quotas concem- ng whisky from Canada and England. Mr. DOUGHTON of North Carolina. Will the gentleman rield? Mr. SAMUEL B. HILL. I yield. Mr. DOUGHTON of North Carolina. Is it not a fact that he committee gave full consideration to this matter, and the 1934 CONGRESSIONAL RECORI>— HOUSE 103 committee thousfat that with the municipal taxes and all other taxes that would follow that the $2 tax would be about all the traffic would bear? Mr. SAMUEL B. WTTJ. The gentleman is correct. [Here the gavel felL] Mr. TREADWAY. Mr. Chairman. I yield 15 minutes to the gentleman from Wisconsin [Mr. PrearI. Mr. FREAR. Mr. Chairman. I rise more particularly for the purpose of speaking good words for the administration of the committee imder Chairman Doughtok and of Chair- man Hill, who has just spoken. We came here on summons about the 1st of November, and the gentleman from Washington [Mr. Hill] was chair- man of the subcommittee, and committee experts sought to devise means of closing up some of the stopgaps in the incQme tax law and of curing other loopholes. That bill has not yet come before you. but the subcommittee and full committee have been at work on it. Without fear «f contra- diction I can say that members of both committees. Repub- licans as well as Democrats, or in reverse order. Democrats as well as Republicans, have had no serious controversy in the committee at any time. We recognize those in amtrol of the committee, the majority, could put through any piece of legislation desired. But they have been very fair. I speak as an individual, and I want to thank the gentleman from North Carolina and the gentleman from Washington for the consideration they have both given us. On the question of the gallonage tax, referred to by the gentleman from Washington [Mr. Hill], a majority of the members of the committee were in favor of that gallonage tax from the first. I was not, for my experience with the estate tax was such that it was started at 25 percent and then rose to 80 percent of every dollar collected by the Federal Government, which was credited on estate collections by the different States. Therefore, a constant controversy might exist, with percentages allocated by the Goverimient to the States, together with difficulty in administration in both the dry States and the wet States. Notwithstanding it sounds well in theory and was furnished to us by the interdepartmental committee, we believed it impossible to administer properly, and so the committee simply legislated as to the Federal Government tax to be collected and retained. You have heard that tax rate discussed here today. An interesting feature which gentlemen on both sides of the aisle may have noticed is that Members from the same State of New York and from the same city are at extreme ends upon the amount of Federal gallonage tax to be collected. Some would have it as high as $5 to $10 a gallon, on the theory the tax is a small part of the sale price, while others would have it as low as $1.50, or thereabouts. No scientific administration can be had in any way. No argument here will decide rates. We had 25 or 30 of the supposedly best experts on the question of a proper tax to impose. On the Republican side we accepted the tax fixed by the commit- tee without debate, not because of any spirit of hostility, but we felt that the administration was carrying the burden. The administration wanted a $2 tax. The majority Mem- bers finally were a unit for that, and we voted " present ", not with any hesitation about expressing ourselves but that was the best course to pursue; and the majority Members found that no objection or obstacle was placed in their way by the minority. No Member on the floor of the House knows any more about it than did the witnesses before us, and even they generally disagreed. The matter of rates that would en- courage bootleggers, question of importations, cost of pro- duction— all questions were threshed over constantly with- out reaching any result. The majority members on the Democratic side brought in this $2 tax, and it was not opposed by the minority. Mr. MAY. Ml-. Chairman, will the gentleman yield? Mr. FREAR. Yes; certainly. Mr. MAY. Did the committee consider the fact in deter- mliung the rate of tax to be levied that all the States and municipalities are practically bankrupt themselves, and that they perhaps would be hontizig Uqoor as a source of revenue and would perhaps put on an additional tax. XK>t in order to foster booaegging, and that in consequence of that the Federal tax ought to be less? Mr. FREAR. I object to the last plirase of the gentle- man's quesUon. because he merely excesses his individual opinion. Many witnesses brought out that proposition with the thought that unless you have a dictatorship no one can determine what each State and county and city will estab- lish as a tax. That was an argmnent made to us repeatedly. Mr. MAY. Does not the gentleman think that $1 per gallon tax by the Federal Government would give more lee- way to the States, and that they would not put on an additional tax which would encourage bootlegging? Mr. FREAR. No; assuredly not, and I refer that ques- tion to the expert from New York, Mr. O'Coimo*. who has questioned speakers. He thinks the tax ought to be as high as $10 perhaps; and his Judgment is fully as good as any, I presume, if not as good possibly as that of my friend, the gentleman from Kentucky. I have been known as a " dry Member." We are taking the situation as it comes to us today. Friends on the dry side of the aisle as well as those on the other have said. What are we going to do with the bill and rates? The people on a plebiscite decided that the eighteenth amendment should be repealed. They gave a tremendous mj^ority for repeal. Are we to refuse to act and permit the coimtry after a repeal of the amendment to go without enforcement laws or must we legislate about it? It is the only thing that can be done. Otherwise we would have no law on the subject, "nien bootleggers would thrive without restriction. That is a situation that confronts the House and those who are pulling the laboring oar here. Administration members of the committee have recom- mended a $2 tax. and have also recommended a tax upon wines. Those rates will remain in my Judgment as the opinion of the House. I want to say one word on the subject of the repeal plebiscite. I believe, as stated, it was a tremendous ex- pression of the American people's desire which was had. All must accept the decision of far more than the consti- tutional two-thirds majority. That is popular government. The result of the vote on repeal was probably a surprise to all Members. It disclosed the disposition of the American people on nonenforcement of law. They want no more of speak-easies or the bootleggers, although these wUl never be wholly eliminated. What they want is to have a legitimate tax levied and c(rilected and laws enforced. Every prose- cuting officer — and I am satisfied many of you Members present have been prosecuting officers in the past — all know that in the trials of Uquor in the courts you have always been aided by the man paying a license, who was always anxious to convict the man in competition with him who was without a license. By the enactment of this law, which will be passed by the House tomorrow, you will have put a number of active agencies into alliance with those who seek, so far as they can, to secure law enforcement and outlaw the bootlegger and speak-easy, because they are in direct competition with the legitimate liquor dealer. You wUl find that they are very helpful. Mr. Chairman, in further respect to the plebiscite I should Uke to insert portions of a speech I made in Milwaukee dur- ing the sununer. and I ask unanimous cataexxt to extend my remarks and to include that and other data. The CHAIRMAN. Is there objection? There was no objection. Mr. FREAR. Mr. Chairman, let me say further it Is significant that the first bifl on the calendar for discussion and passage this session is the so-called "Uquor bill" re- ported by our committee, which follows repeal of the eight- eenth amendment by the people in 1933. President Roose- velt urged repeal and a resulting tax income by passage of the bill. I am not discussing merits of repeal or of the pur- pose of this bill or of rates of tax herein provided. Part of that discussion is water over the wheeL The people of this country by an overwhelming vote have, as stated, given Con- gress a mandate. CONGRESSIONAL RECORD— HOUSE 104 President Roosevelt has ^'^^^^ '"^"^trTJ^e S^tlegl manded of Congress and the people an end of the bootleg ^nB crime wave The result reached in the country rnj- ^^s^aTonT^omng influence through the Presid^t^^^^^^^ ha-s had the final voice heie as to Ux and hcense raies. ^h repealnow voted by the people, control can only be exercised by law and that control with rates fixed by the admm^tratLn is placed in the hands of those responsible 'V^^nZTe^^on to power the President exerci«s in this and many other relief proposals with a hope that President Roosevelt may assume power to urge upon Congress a mat- ter of far greater anport than any policy or plan yet placed ijefore him. With that purpose I have c^x^ to be in- serted herein my spee -h bef3re the National Fraternal Con- gress recently given in Milwaukee, with arguments there presented, together v.ith quotations from past speeches in the House on th.- same general subject, with other data. The matter referred to is as follows: Srarn or Hon. Jamis A. PttA. BEFOia the Nattowal 1^™^*!- CoNOEias or Amkica. Milwaukk. Wis . Acgust 20. 1933 The Chaikmam The -ent^eman who Is to talk to u-s l« first an A,J?-can^an?f patriot^ He has supported recent admlnLnrations m efforts to lift the depre^.ion Jog. He h*" ^"*r,% P-^SJ needleaa war The war-wcm natlona of »irope wui quic^y f/^nn« with the only real peace measure afforded. ISLTi offw mSfiputablVe^ of democracy'B to- through war. ^^,„ TH« WOaU) WA« HAS rLACTO DICT4TOBa OVD POPTTLAa OOVISlOfDtT PoUowlng our Revolutionary War and adoption of the American Constitution, practically every government In the world gave en- larged rights to iU people through parliamentary bodies "nd rep- r^nU ive government. Then came marked progreaa In cIvUIm- tlon These Invaluable rights have been thrown to the w^da by the World War Russia. Italy. AustrU. Germany. Poland. Turkey. Soaln and others have relapsed Into dlcUtorshlps with wlde- soread break-down everywhere in constitutional popular govern- ment That is one of the frulU of war. more disastrous In lU conwquences than lowses of lives and property. , * , «„ Without profiting by any territorial gains through a foot of sou or dollar exacted, our own losses are not yet fully measured, but we too. are pausing on the threshold of a threatened loss in noDUlar government more dangcroiu than we realize. Carloads of medals were distributed liberally after the war to end wars " for " valor " to recipients often not within several thousand miles of the fighting front. It was one of the humors of war and diverted attention from more material things but could not explain lndefen»ible Inefficiency in failing to supply fighting soldiers with needed protection. Appropriating over a billion dollars for airplanes and expending over a half biUicn dollars for pUnes during 19 months of war Is only one Illustration of many trajlc pages, but speaks volumes. Kcr OME ncHTiKO ruktn urm a hait bujjow oollabs Tsrwimrma After more than a year and a half of war " experimentation '^ and expenditure of $.500,000,000 for airplanes. Secretary of War Baker gave as the result in war planes (taken from the hearing* on war frauds, vol. I. serial 2, Aviation, p. 46) : " Mr. FtOAM. We did not during the whole period of the war get a single fighting machine or bombing plane to the front? "Secretary of War B.\kcs. Not a single fighting machine oi bomber of American make." This undisputed fact was confirmed by testimony of Genera. Patrick and others. Congress appropriated over a bllMon dollan for planes during that war with the tragic results stated. Agair quoting — •• Secretary of War Baksk. Every element for safety for anyon( i In such perllo\i3 occupations should be added. •• Mr. PaxAa. I think so. According to your report, page 53, yo\ aay: 'The reported battle fatalities (aircraft) overseas. 244. Ex perlence at the front Indicates that two aviators lose their lives li accidents for each aviator killed In battle. Fatalities at tralnini ; fields In the United States to October 24 were 262." " " Mr. PaxA«. That makes over 500 fatalities — one half In country — through accident" (same hearings, p. 53)." Yet medals and decorations were given men responsible that tragic record. , I could quote many pages of like character. Fine American boys we sent to war. boys as brave and daring as the best l;i Exirope. Rlckenbacker. Melssner, Mitchell, and other world-know^ aviators who testified before my committee. WlUi marvelous ords. they all fought in European planes — borrowed from aUles. , At the Harding Disarmament Conference In Washington, peace offerings and arms reduction promises were enthusiastically greetel by all participants, but the only nation to make any reductio i gesture was ours. At Geneva thereafter, I asked Hugh Gibson w^hom I first met in Warsaw, wbat progress was made In second arms reduction conference directed by six American tleship admirals, our spokesmen at Geneva for peace. It fruitless. Real peace advocates do not send machine guns bombs or " fighting men " to further peace proposals. It was game in which every nation played its own hand, with reservs tlons. mOPK'S rSABS, HATKS. and AMBmONS INSPIXX WASS A picture of Euroj)e's war attitude not found In books learned when In Moscow we asked Tchltcherln, chief of foreign affairs, why Russia did not reduce its army, then of 660.000 men He answered bv saying that Prance had a standing army ^' 750.000 men and was financing the Polish Army of 270.000 r and also Cwchoslovakan Army of 150,000. "We cannot redute our army with that threat along our borders ", he said, reported Russian Army of several hundred thousand on eastern front today is a buffer for Japan's war forces. That Is on the opposite side of the world. Italy's Increase in population, due to high birth rate. Is pride of Italian war officials, who compare it with that of Franc s That fact was stated to me repeatedly In Italy. Hitler In Gei many has urged that same birth increase In man power, to In thrown, when ready, against the same common enemy. Prance and Germany were responsible for the last war — and for wars. We hitched onto the Uil of the French kite 16 yean Where next? Will Kurope reform? "All my ancestors for 300 i bave fbutht asatnst the French", aidd Btsourck. Tluit'r answer. thli for rec- our bal- wss cr Wis Tie ther f roi t tie te maty ag). yeajs tie RECORD— HOUSE January 4 Many hundreds of millions of francs »P«°*/o' i°'*'^^*S! alnM^the southern French border are of no value, when Balbos Sf^Ssh^^TSShSh over the Alps, disclosed fortifications; and tatt^JJ SSe^fttle%lace In modern warfare, yet the mad race for ^£^ents goes on greater than ever in all h^tory. with Sance contributing one quarter and Italy o°« t^l"*_°' J^*? f^^lve budgets today for armaments to use against each other. "SSS-oM European fears and hatreds fPe^J^ through ^n Th7 niiiM Of veste'dav may be bitter enemies tomorrow. What J^te? w^r ?robabniueJ c^n be offered than the foregoing facts? L^ Thin «) days ago the " Navy League ' of America secured a itfal pLltrcoimictlon program with over $200,000,000 for im- mSlate^addlUonal naval co*nstructlon. In addition to our annual SS.000.000 expenditures for Army and Navy-greater than any SheT^untry in the world. It was met by Japan on July 21 , with an armf budget of 645.000 yen and a naval t>"dget °f ^70.- ' WWOOO yen. Japan's contempt for the League of Nations and treatment of China is fresh in every mind. Japan also meeU our £vy League's challenge for naval supremacy. Human nature is the same the world over. .^^ „ -. » While Sitting at the same table some years ago with Sun Tat Sen in Shanghai, I heard him denounce the 21 demands of Span While he said to us. 'America is the hope of the world" \ nation like ours, shaking its mailed flat In the faceb of self- respecting nations, building up a huge war machine of battleships and shoiUder-strapped warriors, is un-American In character and i i? popular in the ^eat family of nations as a no sy bully with kchlD on his shoulder, brass knuckles on his hands, challenging anyone to stop his warlike antics while singing hymns of self- praise. Acts and words are alike measured by others, nUCnCALLT IVniTBODT TAVOaS NATIOHAL DtfXNSX BUT WOT WAS INSANITT " National defense " is a slogan that means anything and every- thlntt Everybody agrees to the principle, but we are approprlat- ine far more money than any nation In the world for " defense today " National defense " is as elastic as rubber and is used to QUlet restive taxpayers. How much do you suppose that tax- oayer is paying today for war? Practically 70 to 80 cents of every dollar. It is estimated, of ordinary current Federal taxes goes for wars, past and future. " Preparedness " shouting is generally led by selfish Interests, as d'sclosed by Colonel Gray. Those who echo the cry are ordi- narily without knowledge of the facts nor realize that extreme pre- paredness Is a challenge to war. They know nothing of the seamy side of modern wars or of trench conflicts or wire entanglements, machine guns, bombs, or gas. or of wounds, hospitals, or crip- pled bodies- but through patriotic fervor unconsciously respond to inspired propaganda. Gray paid his war debt with that service. He speaks with authority. Normal persons, not consumed by greed or stimulated mlUtcry glory express hope that we may never have another war— a vain hope. Seemingly believing wars are caused from supcr- nattiral causes and not ordinarily by selfish human agencies, they pray for protection against war instead of studying caxises and taking active steps to prevent. Everyone who questions this policy of wasteful governmental war extravagance by unbridled greed of Individuals and com- munities masquerading in the garb of natloi;xal defense, is pilloried as a pacifist. Yet we are paying far more in times of peace for national defense than any other country In the world, and more than double pre- war expenditures; all in times of peace and for peace purposes, we are told. Germany once set that same example, when the goose step was more popular than it is today. France Is now the leader, and France is surrounded by Jealous potential foes eager for war. I have heretofore presented on the floor of the House of Repre- I sentatlves war preparedness figures and you will observe how our ' ' Nation has increased in the mad race and how it compares with other governments in that respect. IN PEACE TIMES WE TOP THE WORLD IN WAR EXPENDITCnil3 We have recently been expending annually over $800,000,000 for military and naval war bills, more tiian double what the taxpayers of this country v.erc paying prior to the World War, as shown by the accompanying table: 1918. 1926. ; 16'27. ' 1928. i 1929. 1930. 1931. 1933. Army $164. 63.1. .-iT? 356. 072. 226 3W. HOB. 777 390. 540. 803 416, 901. .543 453. .'.24, 973 47H.418.974 402, 239. 701 Navy $155,029,425 r,12,743,4l0 318. 909. C9f» 331.33.5.492 364, 5fil,.'>44 374, 165, t'i39 354,071,004 657, 436. 995 Total $319,665,003 Cn7, 815. 633 C79.717.873 721,876.295 781,463,090 827,690,612 832, 489. 978 819, 676. 690 Figures taken from the World Almanac of 1933 show an lncrea.se In 15 years of total Army and naval expenditures of more than 266 percent and 1934 will reach far over a billion dollars for war preparations or more than 25 percent of ordinary Budget expendi- tures. Pressure for a greater army and bigger navy Is to be urged on Congress next session which reminds us ol the admonition at tilstorian Abbott, who says — I 1934 CONGRESSIONAL RECORD— HOUSE 107 " In all despotic goremments It is necessary • • • to have a powerful military force." That warning against despots, and wars wa^d by despots. Is observed In war when a military despotism Is all-powerful In oiir own Government. Since the Constitution was adopted repudiat- ing despotism, pressure has constantly been exercised on Congress by military and naval Interests through misleading and half truth CfHnparlsons to show that, although spending more than any tsther country for national defense, we are practically defenseless. The ptupose is apparent and if at all honest, reflects gross waste of funds by our war experts. Study In this connection the following expenditures for naval purposes alone by the five principal powers, taken from the Wcvld Almanac, 1033: ins. 1981.. inz.. Annus) avamce, approximateiy.. Alwfor 1S32-33... Oreat Brhain £88,123,257 67, 300. 000 &S, 8&5, 000 51.739,000 $273,.197.S00 rnited States f3.V., MT. .M6 364.233.362 378. 879, 007 37.\29l.828 357. 90B, 219 •276,000.000 X5C,470,3«0 1.832,718,022 366, .543, 603 318,906,141 France $». 046, 348 101, 600, 000 Italy $57, firn, OOD 60.021,000 $128,203,000 131.222.000 137,516,120 80,795,701 118,970,598 84,509,264 4M, 123, 066 91,224.613 94,823.500 282.974,«S6 S6, 504.991 80, 947, 264 Japan 131,468,844 105, 437, Sa» 498,831.41$ 90,206.283 24A,»41,7«7 Draw your own conclusions from these war preparations In times of peace. Forty million active and reserve soldiers, according to the same authority, including 4.000.000 " selected " soldiers in this country, are in readiness for the next world war and add enormously to war- preparedness costs. A feverish race has been on with naval expenditures dvu-lng the past 6 years, of which the United States contributed $1,832,718,022. to which we are asked further to build a billion dollar parity navy, for more American battleships to be used In naval target practice. Obsolete $40,000,000 battleships, Mitchell, airman, de- clared might be sunk with a single bomb, but they make good targets and furnish large profits to shipbuilders. And in this mad race for war expenditures taxpayers have no voice or con- sideration. MUNITION MAKERS INSPIRE WAR PROPAGANDA No President can resist the direct pressure of his close Army and Navy advisers, reinforced by powerful financial Interests that find many reasons to advance for war excepting reasons of pelf and profit, potent in every war. The munition maker is our first line of offense marching with Army and Navy high officials when war is proposed. The voiceless millions who will be conscripted to fight, how are they to be beard? Not one voice can be raised without the charge of " op- posed to national defense." That is found in every country in the world, and the poor pawns are later thrown into the scrjyp- heap of war. They neither exercise any voice for war or are able to resist service. In a great world democracy war dictatorship is supreme. David scattered the Philistines with a single stone, which slew their leader, but under the modern code hundreds, yes thousands, of tralnloads and shiploads of w^ar munitions are sold annually to destroy life and make profits for war lords. That is the financial interest of these war propagandists; and the Individual soldier, multiplied by millions, is ground out of existence, with a wooden cross for his marker. In making profits. That war Issue is more important than any other question. There is not a mother or father in this hall, nor a child in the country, not interested in the effect on them of threatened war and the danger of oiu being thrown Into war by propaganda. Not " danger " alone, practical certainty based on opinions quoted. Munition makers and others overwhelm the President with the necessity for resenting some alleged insult to our national honor. The President when persuaded, though elected 6 months before because he kept us out of war, then tells Congress what to do, and Congress always yields to the clamor by surrendering to propa- ganda with its " declaration of war." Read the debates prior to the last war vote in view of subsequent events with the oft-re- peated cry, " stand by the President." He with Congress is subjected to deception when war hysteria reigns. Selfish and ambitious Interests feed on fears, pressed on the public by propaganda carefully nurtured by Navy leagues, muni- tion makers, American War Lord Northcllffs, and like Influences, leaving the public bewildered and helpless. A picture of Inter- nationalism is presented that seeks to lead the world, whereas the great mass of our people are for noninterference, peaceful settlements, without desire for territory, revenge, commercial ad- vantages or pelf, the aim of warring nations. Until we overcome these un-American war agencies no permanent business recovery is possible in this country or in the world, for rumors and false alarms are the tools in trade of the propagandist. Personal reasons for the war vote are apart from merits of this discussion. However, arguments pro and con. knowledge of feuds and nodlltary rivalries centuries old. Involving balance of power in Europe, boasts of arrogant goose-stepping officers, and other influences, were all deemed trivial compared with horrors of war offered our people who had no voice. in the dectsion. Foreign alli- ances were believed perilous to this Government and its people, fraught with tinllmlted future dangers. Without criticising judg- ment of others, responsibility for action was not influeneed by chUdish crys of pro this or pro that, but by an abiding laith In pro-Americanism, It requires far more courage to fight foes from within urging war than those from without and baaed on all our history, th« oratory and arguments that demand warlike preparations are not the voice of the people who are to b« butchered by bombs, ma- chine guns, and murderous gases. Now that wars Inrite ex- termination alike of helpless women and children, public atten- tion is guided away from war's results by holding up the slastie time-worn cry for " national defense ". a defense thftt has already caused America to shoulder upward of 80 percent of nonnal tax burdens for its wars to date. When looking for causes of depraa- sion and war burdens, do not forget that the ledger Is alway* on the red side when war comes. KMOWM LIABILmaS aCCBIVSD raOM THE WORLD WAS Otir present shocking reign of crime follows and comes through the last war. That war encouraged frauds and profiteering In Government, countenanced lying propaganda, promoted wild na- tional and individual extravagance, taught that violence, force, and wrong-doing could Justify ends, including legalized killing and slaughter. It did all this under a plea of developing manhood, courage, and character in defense of national honor and msklng the world a safe place to live in. We reaped a whirlwind of crime th$t follows every war and no- where in the civilized world are statistics of lawlessness compa- rable to ours. It brought repudiation of $11 4)00.000 XNX) loaned to our " allies ", as stated, to be shouldered onto American taxpayera. Apart from wide-spread misery, loss of life, property, and ideals, that was our substantial return from the last war. Will we repeat? What is to prevent when a President elected because lie kept ue out of wav, can put us in war? The people who piy stwuld decide and not Presidents who. through K ■ubaenrlent Congress, will all be swept off their feet by false war propaganda. That iM the problem. How to prevent war lords from forcing us into another war to end ware. During the war our chaplains pray with fervor to the same God for success in arms that our enemies' chaplains beg to. and with equal fervor, while victors and vanquished alike are crushed under this modern Juggernaut of war. Those offering discussions of approaching war and possible preventives are pointed out as " pacifists " and placed on the defense when valiant generals and admirals and would-be military authorities, rarely In many miles of danger, loudly shout for our national honor and for another " war to end wars." NO PRmE IN UIUTART ACTIVITIES NOR A PACtTIBT I have no pride In any personal or family military record, but speak from an experience of many years In military service, of which 5 were spent In the Regular Army and a company raised and offered for war service. A direct ancestor was killed leading his company in the Revolution. A father and son each served throughout one of the last two great wars as voluntecn in active service at the front; so I understand what war means. I sp>eak feelingly also because the Thirty-second Division of Wisconsin and Michigan troops in the World War suffered 13,000 casualties, r nearly one half of the entire force was disabled, and a small company from my home city lost 88 men. killed or died in France. That is " war ". and that little company lost more lives In battle during the war than the entire American Navy, which is constantly on dress parade In pictures fanning the war spirit for future conflicts. Naval officers and sailors are presumably equally brave, but private soldiers in front and rear rank were mowed down by machine guns, while admirals and seamen walking their decks, high Army experts far from danger, and powerful war advocates who held foreign securities were never found among the dead or missing. The humble " private " sacrificed life — his most valued possession — while these others enjoyed safety, alike dear to them. That is the system I knew, a system I voted against along with Leader Kltchin, Keating, and General Sherwood In Congress, the latter a great soldier who started as a " private ", and through 40 battles in the Civil War won his " star " by fighting. When war was declared, all Joined to win. That is the only course when once In war. Any arms embargo Is usually protested by military and naval authorities and by munition maniifsicturers. That Is their buoi- ness. while admirals and other officers sometimes hold stotii • .ji powder, arms, and other companies that will be affected by war. Every munition maker naturally is with the lobby and propa- ganda which demand unrestricted sales to all combatants. L«t me give another picture of their influence on war. ELEVEN BILUON DOLLASS CtXARANTEEO AMERICAN MTTNITION MAKERS I Stated in the House when the arms embargo proposal was before Congress this year, that money we loaned our Allies (since largely repudiated), and approximately $11,000,000,000 in amount was raised by American taxpayers to pay American manufacturers for furnishing war supplies to European nations. The United States taxpayers thus paid American manufacturers who provided munitions for the Allies in addition to vast expenditures made by our own Government in that same war for our armies. That was a prize and price of war. Eleven billion dollars was the prize sought and won by American munition makers. Won by our entrance in the war. Lost to them if we kept out. They helped put us in as has been shown. What peace power cotild combat the greed and avarice of men who had $11,000,000,000 sure money awaiting them if our country 108 CONGRESSIONAL RECORD— HOUSE January 4 Under tbe Constitution, the President, as Oommander in CbUt, can send e^cry man and woman. iX need be, to the front to defei d was thrown into that war whirlpool? Sold at double pM«-tlme Drtces and more their enormous profits warranted unlimited ex- Jendltures for war propaganda. International f«^"^*2»«^J"l«^ involved among motives for our war entrance; but ''e «T»„P'"»- dent. Just elected because he kept us out of war. P'-«»ctl«^lly de- mand from Congress a declaration of war because of mistaken facts he read to us. *hlch I have presented to the House on differ- ent occasions, with Secretary Lansing's correction of facts. WaT propaganda knows to the full a mob psychology that reaches alike from the layman to the clergy. It causes men to see red become Insane and lose all reasoning power. Recovery brings sorrow and suffering, sure to follo^v such appeals to force. When m passion, the Individual kills. When uncontrolled rage occurs, ihepeople voice legalized killing by war. The propa- gandist knows that fact and plays on their emotions and prej- udices in gaining results. That occurs with every war but the people should decide If war Is to come, for they do the fighting. It is comparatively easy to center propaganda on Congress. It would be resisted and overcome by a people whose rights to peace and safety through a plebesclte would aid their Judgment. Faoirrs in war contracts unlimitbd in war In urging limitation of profits with war contracts and war pro- duction, a recent war commission, headed by ex-Secretary of Wa] Hurley reported, based on evidence of his chief of staff, that nc manufikcturer should make over 6 percent on any Oovernmeni contract during the war. . » w. ..w The advice of generals and a Secretary of War in taking th( proflu out of war contracts Is Interesting to those who know sucl course to be Impossible even though solemn resolutions by veterar soldier organizations are also to the same effect. Every membei of the Committee of Fifteen that Investlgr.ted the World War con tracts believes to the contrary, and I was a member of that 'jom mlttee. However desirable. It Is only a matter for moot discussion. When in war all laws are suspended, including the Const. tutlon. Whatever the cause of war, once in. the war must be won, and In every threatened country, particularly our own. where prlvati; business controls the Governments war munitions and war oper ■ atlons. the limit of profits has been and always will be the sk ' during war as long as profits remain In the hands of prlvat^ parties. The Shipping Board squandered billions of dollars without pro- Tldlng service ships during 19 months of war Congress spent over a half billion without producing one war plane spent through our aircraft experts and other American "• war experts. ' History will repeat profits and blunders, and hundreds of useless warships now rusting and rotting In our yards at Phlladelphit . San Diego, and elsewhere, will be doubled and tripled without re|- sult except to disclose the monumental folly of war experts. Con- tracts by the Government for public works and public material even In peace times are suspiciously noncompetitive. In war n) pretense of cost and price relationship exists. After a profound 6-percent-profit finding, the recent War Com- mission agreed that the precedent established of conscripting mei for war shall be a fixture in our future war operations. The yout i of the land will be subjected to a " selective " draft automatical! f when war comes. That Is the only recommendation sure of er- forcement. Guaranties of life, liberty, and the pursuit of happi- ness are set aside in the same Constitution by those who pretenl profits can be curbed when the Nation's life Is at stake. Presidents should be given power to declare an embargo agalmt arms shipments to all combatants when we are not directly Ir - volved. Such power has been given to President Roosevelt dui - Ing the recent session. It Is one step to prevent war. It was op- posed strongly on the fioor of the House. I supported It becau: e I believed he should have the power, and he received It. but It s no In&urance against war. War prevention, however. Is largely In our own hands. If we will exercise It by permitting a prewar pleb - sdte by the people. In days of war propaganda, of false reports deliberately clrci - lated to arouse war hysteria. It Is difficult now to awaken tlie American people In time to prevent us from Joining the next nud war game. If the press could be compelled by law to carry a statement of facts from the President, then the people should le the ones to determine by a plebiscite If war Is to be declared. Surely men to be thrown into the trenches and those dependirg on them for a livelihood should have a voice If war Is to come. When war Is on. nothing Is too good for our "defenders": b\it soon they are forgotten, pensions cut off, and the poor human wt o was seized by the coat collar and thrust Into war at a dollar a day. risking his health and life. Is often thrown Into the scr^p heap. Judging from recent happenings. Every Member is delugt d with protests today from Teterans who believed promises would be fulfilled by a grateful Nation. If frauds in individual ca«!S occurred. It is grossly unjust to take the executioner's ax with a million or more cases as it would be to Invalidate all Goveni- ment contracts because a small percentage was found fraudulec t. We did not hesitate to promise reward when sending the txiy to fight In Prance He went on orders. No Justification can evi>r be offered for the distress and suffering caused by the ruthlew cancelation of. these pensions. A Buas WAT TO Avom NKSOI.XSS WAR — whx ws act im timx? For three seaaions I have introduced a proposed amendment o the Constitution that, if passed, would give the people the right to determine whether our country could be involved in foreign against any Invader, Twenty mlUlon selected. *ble:^oJ)«» "«"• aRd double that number if need be. could be sent by the ^««/- dent to our borders to defend against all the armies of the world that might be brought against us. Only a fraction of that number would ever combine against us. because of certain defeat and Inability to combine. In 19 months of war. as previously stated, an expenditure ol over a half billion dollars for airplanes was largely wasted without obtaining one American battle plane during the last war. Many other billions were practically wasted by "war experts and dollar-a-day men during war. ,^ .„ A comparatively reasonable sum properly expended would pro- vide us with many thousands of fighting planes and an army of fivers with which to defend our borders from all foes that could be marshaled against us. A $40,000,000 battleship alone keeps men working on a dlschcrded. obsolete war weapon, but even that amount spent for defensive airplanes would furnish 2,000 or more protectors that could not be matched by Invaders. Ten times that amount would willingly be expended If need be, but parity-navy propaganda to equal England's Navy is without reason or result excepting to profit war contractors and shipbuilders at the expense of taxpayers and aid other nations that will again ask us to help when threatened by war. Every shipbuilder and munitions maker favors a " parity navy." That is their business. In Russia. Italy. Germany, and practically every other country, a gDvernmeut censorship is exercised over the press that reaches suspension. If need be. when war Is under consideration. Any effort to limit propaganda with us Is construed to mean restriction of the liberty of the press even when war Is being considered. Sensational reports are then published to arouse men to the fightin<» pitch and fan war flames to incite mob action. That Is one easy avenue for propaganda. The radio, movies, and other publicity agencies are impossible to overcome when combined to force a war declaration from Congress. For that reason alone it Is well to seek protection from war in advance and exercise by law punishment for willful false propaganda. Time prevents consideration of such propaganda control or how to be exercised In our own country. I have Introduced In several successive sessions of Congress the following proposed amendment to the Constitution that may not excite popular attention because not given to prowar sensationalism but would be effective. It reads: " HOUSE JOINT RESOLtmON 103 " Resolved by the Senate and House of Representatives of the United States of America in Congress assembled (two thirds of each Ho\iee concurring therein). That the following article is proposed as an amendment to the Constitution, which .shall be valid to all Intents and purposes as a part of the Constitution when ratified by the legislatures of three fourths of the several States: "ARTICLE — " Congress shall have power to declare war only after the war proposition shall have been submitted by the President to the several States and a majority of the States at general or special elections called by the governors thereof shall have approved the same. This amendment shall not be construed to prevent the President from using the Army and Navy to suppress Insurrec- tions and to repel Invasions. "The right of the people to be secure In their persons shall not be violated by conscription or forced military service, but when public safety demands Congress may provide for forced military service on the North American Continent and In no other place." I am not Interested in the phraseology but only in the purpose and scope. Its terms are sweeping: but If liberty of speech and press Is part of our Constitution, so Is life, liberty, and the pursuit of happi- ness to the Individual who under modern w.-^r methods can be taken from his plow or shop and thrust Into foreign trenches to fight more foreign wars. That would be largely prevented by pas- sage of this amendment, for the ease with which Congress always swings Into a declaration of war would be hampered If the people who pay the piper are permitted to speak at the polls. They would never have voted for recent wars In which we have been engaged and we may judge the future by the past. WHAT BETTER PLAN TO PREVENT WAR IS OFTERED? If the press for 30 days were required to publish arguments for and against war as offered by a President's message to Congress, and at the end of 30 days an election held In every State where the people could exercise their franchise, this would be safer than to leave our national life in the hands of Irresponsible war agen- cies and paid propaganda that profits by deliberate misrepresenta- tion. When we reach a sane method of handling war threats, we will prevent useless foreign wars to end wars. Every man Is subject to call to prevent Invasion or Insurrection, but that is not af- fected by the proposed amendment. As It stands today we are liable to be Injected Into any war. The President was quoted by a French writer as saying that we are not going to Interfere with any foreign wars. Who Is going to be the next President, and would another one tell Congress to declare war within 6 months after hU election becatise he kept us out of war? The only safe proposition for the American people who pay the debts and furnish the troops Is the right to decide. The boys who are to fight should also have voice. TamttapV 4 1934 CONGRESSIONAL RECORD— HOUSE 109 UT MM HSPS&T, ALL nrVLTIUfCBS OM OOHOUBSS PBOPACAHDA DKMAKDS AU rOft WAB WBSXr I I have not dwelt upon the horrors of war. I have been over battlefields of the Spanish-American War. down to the Philippines, and over the battlefields of the Civil War and of many in Europe. My father was in that Civil War for 3 years and 4 months. I have not dwelt upon the pitiful pleas to Congress against wars, by mothers whose sole support was taken because of their boys' belief that war would be a long holiday; of brave parents who tried to find solace for a vacant chair in the household by a gold star; of appeals to Congress to end the war. impossible when once in, or to get their boys home; of crippled youths in the springtime of life, of long struggles when pensions were cut off and veterans with their loved ones thrown on pxiblic charity. Three war cases were sent to me recently In 1 day. All plead- ing gross injustice by tlie Government. One man showed me his twisted foot. " They have cut off my pension and got me and my family down to $8 "; $8 for a man who cannot work because he is a cripple because of that disability! Veterans kicked out by those who too soon forgot. New youths and a new generation will soon come upon the scene, and the past wUl be forgotten as the glittering bauble of war's lure Is again pafnted In false, attractive colors by those who never fight but send others to fight; who profit with the greed of Shylock over the pound of flesh In millions of homes. These are part of a nightmare that left Its impress on Members of the war Congress and during many sessions that followed. In the most serious problem of all problems that face the people of this country and other coim tries today, a problem to be determined not ]?y the i>eople but by self-app>ointed war lords, we will In all probability again be called upon to bear war's burdens, possibly heavier than ever before. Withctit shrinking from the decision. I am presenting to you a preventive against needless wars and for the preservation of a civilization that experts declare may be wiped out by our failxire to act in time. I thank you. (The members arose and applauded.] President LaRocca. I am sure that the subject which Congress- man Prear has discussed before this congress is necessarily a very great problem, and for his helpful advice we are all truly grateful. • •••••• A CKRTAIN REMEDY AVAILABLE Mr. PREAR. The foregoing address, made over 4 months ago, is self-explanatory. The situation has become more critical, as will be noted from other data herewith appended. The remedy first. Less than 1 week ago, President Roosevelt on December 28, at the Wilson dinner, gave utterance to a naked truth when he said that " political leaders, not their Ijeoples. threaten the peace of the world." That being true, the only guaranty of peace is a pre-war plebiscite which per- mits the peoples to determine when war shall come. In this movement and emergency Roosevelt can lead the world by giving to the peoples of the United States right to set an example to the world. No better insurance can be had against " scraps of paper " that compose worthless peace treaties and equally worthless European debt pledges; no better protection against savage warfare and its boon com- panions— crime and vice — has been proposed. It is the best solution offered to protect the people against selfish in- dividualism because it puts faith and trust in that people who must decide. Any President who advocates that proposal will endear himself to his people and to the entire world more than by any political move or economic experiment, however promising. HOW AND WHEN WAR THREATENS LISTEN TO 8BCRETART BAKER'S PREDICTION, SECONDED BY FRANK SIMONDS AND OTHEE WAR EXPERTS Following my address given last August before the Fra- ternal Congress of America, brief extracts from prior speeches in the House made on the same general subject gives corroborating evidence referred to in the Milwaukee address. Also extract from statement of Ex-Secretary of War Baker, given December 1. 1933, scarcely 30 days ago. I quote from the Associated Press report: Cleveland, Ohio. December 2. 1933.— When the next war comes it will be almost impossible for the United States not to become involved. Newton D. Baker, former Secretary of War. told the Poreign Affairs CouncU here yesterday. • • • The farmer BecKtary of War said the world is living In a powder magazine, and some are walking about with steel and others witb flint. In Other words, this high authority during our last war announces war will come and it is " almost impossible for the United States not to become involved" again. That testimony supplements words of Secretary of State Hull, Morgenthau. Riwinrtrin, azkl othen previously qitoted. Euro- I)ean war threats are practically undisputed. Mr. Baker is familiar with influences that precipitate wars, and no man is better qualified to speak. He is conservative, and from my acquaintance with him in 1917-18 when war was on. every question by him was resolved in favor of Army Staff decisions for. as he said, he " had to depend upon the staff to win the war." That super military power will be exer- cised when war comes again, and again all-controlling voice in the world's greatest democracy wlU be that of war generals. Mr. Baker was an outstanding candidate for the Presi- dency last campaign. His position, if in the Executive chair, can be imderstood by past history, and without criticism. I say he presents no method of war avoidance. If " steel and flint " clash, as threatens, then the President and Con- gress again will be overwhelmed with propaganda, whether true or false in character. As stated in congressional debate in 1917. not 10 percent of the people who fight and pay want war. and if given an opportunity they would vote against war and against sending conscripted American boys to fight in the " powder magazines " of Europe. During recent years I have, as stated repeatedly, offered a resolution in Congress giving this country the right to a plebiscite on war before Congress is again swept off its feet by powerful war agencies. That resolution is now before Congress. Every Representative of the people is responsible for his acts; but when war threatens, Congress is unable to resist the tremendous pressure that follows. Again I sub- mit that a plebiscite should be given to the people by consti- tutional right before Congress declares war and that no American soldiers be conscripted again to fight in Europe's powder house. value of shearer in defeating peace proposals Evidence of war-proi>aganda methods is found on every hand. A few days ago financial results of Shearer's methods at Geneva were placed on our desks in the following news item. Others to the same effect are before me, but merely cumulative: shearer's emploters orf naval contvacts (Prom "International Traffic in Arms and Ammunition", by WUliam T. Stone. Poreign Policy Association Report. Aug. 16, 1933] The three private companies which were Involved in the Shearer case — Bethlehem. Newport News SlUpbiillding & Drydock Co.. and New York Shipbuilding Co. — have divided among themselves most of the naval construction carried out in 'private yards for the United States Government In recent years. Of the sixteen 8-inch- gun cruisers laid down between 1926 and 1932. 3 were buUt by the Bethlehem Shipbuilding Corporation. 4 by the New York Shipbuilding Co.. and 2 by the Newport News Shlpbu^dlng Co.; the others were built in navy yards. These firms have Just been awarded contracts for 13 of the 21 war vessels to be buUt in private yards Under the 1933 naval program, financed in large part from public-works funds. The value of these contracts is approximatelv $100,000,000 apportioned among the three firms as follows: Bethlehem. 1 heavy cruiser, 4 destroyers. $27,304,000: New York ShlpbuUding Co.. 2 light cruisers, 4 destroyers. $37,464,000; Newport News, 2 aircraft carriers. $38,000,000. Pour smaller firms were awarded the remaining eight vessels — destroyers and subma- rines— at a total contract price of approximately $24,000,000. • • • Washington was visited about a month ago by a former member of the Engli^ Parliament who fearlessly denounced the arms makers who bring on wars. These companies are ifye only ones to my knowledge paying extra dividends today. I quote Brockway. on November 30. in support of Colonel Drew and others as to war laropagandlsts: »»MH M*K»»* CALLED ICBMACB — THET SUBSIOIZE JIMOOIEK. EBITUH LABOR LEADER CHABOES HI Munitions makers subsidise patriotic organlcatlons to create world markets. A. Fenner Brockway, leader of the Brttlsb Inde- pendent Labor Party, told an audience at Waablngton Moimt Pleasant Congregational Churcb last night. The former member of Parllajnent charted Ave International companies control the world's armament business and constitute a "sinister force drawing the nations of the world into confllct.- Chief aids to munitions manufacturers In finding markets are patriotic group*, which are subsidized to foment war. Brockwey lunerted. The only effective check to tUs gigantic conspiracy agalvt world peace, be eald. would be aboUtUm of aU armaments. The International aq>ect of the world-wide mtmlttons conspiracy ' 1^ the labor spokesman. wlu> said Hitler now Is buy- CONGRESSIONAL |lECORD— HOUSE 110 ing arms from French concerns, that j^^°<^^- »;\"f .' '^e'^ortd cannon and the shells which mowed down British at the Oardanelles. BIG AKMIES AND BTC NAVTIS IJrVTTE WAR Within 30 days from placing this recital of war activities in the RicoRD 1 quote the temper of other nations over our own war preparations. Human nature is ever the same &s the war supply agencies weU know. Here is one report, hardly a week old. from the Washington Post: LoNDON:becember 26.-Aroused by reports its «*^al»}^f g^.^^ln been outstripped by the United States and Japan. G^^V^B^Ji^: the belief Is growing here, is preparing to launch a large navaN builermlttlng unchal- lenged these conditions, when Bent adds: " The effect of war on the press makes It the subservient channel of propaganda often wholly untrue. It Is a quality of propaganda that, like bribery, stultifies him who gives as well as him who receives it. It doses the minds of both to truth, encourages arro- gance, and engenders Intolerance." What can be added to this arraignment of the press by a writer who literally offers hundreds of examples of press propaganda methods? axspoNsiBiLrrT or thc psbss roa was The war to end wars forced us into that struggle only after more than 30 months of trench fighting by Eurojieans which often re- sembled a stalemate. Wilson did not want to declare war. He was elected In the November previous because he kept us out of war. The RepubUean platform of 1910 sakl spactflcaUy: " We desire peace, the peace of Justice and right, and believe in maintaining a strict and honest neutraUty between the beUlger- ents in the Great War in Europe. • • • We believe in the pacific settlement of intemaUonal disputes and favor the estab- lishment of a world coxirt for that purpose." Yet, within a few months aft^ that solemn ptonouooement the pressure of the press and Interests that urged war were too great to withstand by either Wilson or Congress, and both yielded to that pressure. Wilson sought to avoid the whirlpool. Finally he. too. capitu- lated, and his message to Congress demanded in no uncertain terms that Congress should do that which under the Constitution it had the sole power and right to do — declare war. The President in effect declared war and Congress consented. These matters I have discussed heretofore at length. Quoting from a speech in the Rcookd of January 19. 1932, is a sample of the mistaken information voiced by President Wilson, later disputed by Lansing, that helped swing Wilson and Congress into war: I quote briefly from House proceeding of AprU 5. 1917. immedi- ately before the declaration by Congress for war. I am not dis- cussing the merits of the last war. That is water over the wheel, but I am presenting Influences that always surround Congress when a war declaration is presented. Uncle Joe Cannon, out of a 44-year service, then said regarding Presidential Influence, page 343, AprU 5: " Under the Constitution the President Is Commander In Chief of the Army and Navy • • •. The House is one part of the legislative body. Presidents have made conditions time and. again that have forced the legislative body to declare war. Mr. Polk was the first one." WtaSIPKWTS rORCE COIfOl INTO waaa Practically every war declaration by Congress, including the last one, has been so Influenced by the President. In other words, the President produces a situation that Congress cannot resist. Throughout the speeches for a war declaration In 1917 ran the cry by Members luid laymen, iterated and reiterated, "Stand by the President! " That I wish briefly to discuss, without reflection upon President Wilson, who was elected 6 months before for keeping us out of war. Under the present system, he. like Con- gress, is ever subjected to a flood of war propaganda hard to determine in its truth or falsity, or responsible interest, a pressure equally hard to resist during war hysUria. Congressman Cooper, of Wisconsin, dean of the House, read on April 5. 1917, to the House from President Wilson's message to Congress : " Let me remind the Congress that on the 18th of AprU (1916) last, in view of the sinking on the 34th of March of the steamer Sussex by a German submarine, without summons or warning, and the consequent loss of lives of several citizens of the United States, wlio were passengers aboard her — " And so forth. In predicating a duty of Congress to declare war. the President gave as a determining reason therefor, among others, the loss of lives of Americans sailing on the North Sea — in the war eone — and in face of warnings by belligerents of that danger. The President beUeved that sUtement of losses to be true. It was not true, for Congressman Cooper read extracts from a letter dated March 27. 1917. or only 10 days before the declaration of war was passed, wtiich contained the following: " You are informed that no American cltlaena lost their lives on the Susses and tveiifn. " Very sincerely yours, "BoaoT LAMSUfo. " Seeretarjf of State." That letter appears in full in the Rsoobo of AprU 5. 1917. A misinformed President, with all the power and infltaence of his position, urged upon Congress as a cause for war a reason that did not exist. A reason, even if true, that alone Chould not have caused the loss of 100,000 American lives and •SS.OOOXMM.OOO war expenditures because of venturesome or reckless American travel- ers. Only war's hysteria made it impoasible to resist. It was found to be untrue, as stated by Lansing. Like the sinking of the Maine In Havana Harbor, such reports will always stir national anger, whether the facts and responsi- bUity ttierrtor are true or not. Future wars are certain to result from like reports. Emotional Insanity should not pliinge the people into wars. It wUl not do so If they deelde. A leading Deaaocmtk: Member, CongrMsman Keating, durlag the heated war debate, page 343. Recobd, AprU 6, apWy expressed the feeling of the ooimtry when he said: " I ask MemiierB of the House who among you last October aixi November, when asking votes from yoor constttoents. dared sug- ceet to them that If eleeted you would send their hoys to Europe? Why, my friends. Woodrow Wilson, running on that kind the declaration of war against Germany at this time T?^triJth is that 90 percent of your people and mine do not IJnt^U declaration ST war. and are distinctly oppo8«» to our ffoiiiff into that bloody mire on the other side. ,_«*.« ^ Mr B.nTXN then offered an amendment to the war declaration "••^^o^ed hou,ever. That no part of the military forces of the United States shall be ordered to do land duty In any Pf^ o EuroS ^sla or Africa until 3o directed by CongTess. exceptln* those troops who speciacally volunteer for such service The amendment was defeated. Among many Impressive words In debate °\}^^^ J"^^.^^^^ ouote from Representative Sherwood (Democrat), a lovable man who enlS^d in the ClvU War as a priviite. He was In 42 engage- ments and battles, promoted repeatedly for bravery, and flnallj mustered out of that war. with a brilliant record second to none '"no*^SS?coSS«)US man ever represented his countrymen Ir Ctongres'i. He said, page 335. April 5: ^. , *w,, „„,, "I cannot keep faith with my people by voting for this waj reeolution In iU present form. I will vote for It If the prov»sio«, toauthorixe an army to be sent across the Atlantic to participate in this European conflict is stricken out." „,^„,,. I Quote from Representative Keating, who gave a correct ptctun- of the responsibility of Omgress in sending others to flght whe* he said in debate, page 343. the same day : CONGEXSSMXM DO NOT CROWD REC«OTTU*0 STATIOWS "When Congress declares war. It does not mean that Congress- men are ordered to the front. Congress has declared war hereto^ fore but the recruiting ofUces of this coimtry have not been un convfortably crowded with Senators and Representatives wh|) wanted to enllat." CLAXnX KITCHIN'S WAR STATIMEITr One of the bravest m«n In that war Congrem. and one the ablest, was Democratic Leader Claude Kltchln. who « broke with his President on the war declaration. In a paragrap i he sounded a message to the country that will be true of '»"»' other European war in which we engage. He said. In debate, page 333 : •• We are about to make the cause of Great Britain. France Russia right or wrong, oiu- cause. We are to make their quarrd our quarrel. We are to help fight with all the resources In men money, and credit a dllTerence between the beUlgerenU of Europ i to which we were and are utter strangers." That Is true of every European war. My proposed constitutional amendment meets the criticism leading Members In that war debate by its submission to a pleb sclte as urged In effect by Britten and Keating and preventioa of conscription for European wars as urged by General Sherwood I Democratic Leader Kitchln. and Britten and others. This same procedure will occur If my resolution Is adopted. Is the only preventive of war that will give to the people, power decide. alaa anl got Would you know what President Wilson learned we out of the World War? I quote further from speech 4f January 10. 1932: The following extract with brief comment Is frdta a White House secretary, who was with President Wilson and Mrs. WUstn following the war. At that time the war poker game was beirg played by Clemenceau. Lloyd George, and Orlando, with the Pres 1 dent of the United SUtes seeking to learn the mysteries <>f European war treaties. Her information must be acc\irate. because it has never beaying $10 for what was worth 9 cents before prohibition you can figure out the percentage of increase for yourself. So where the tax was $1.10 a gaUon before prohibition, it is now only a few cents a gallon under your $2 rate. Taxes, as the gentleman from Washington tMr. Samxtkl B. Hill] has said, have no relation to the price of Uquor. Long before repeal the Whisky Trust sat down in the Kuhn- Loeb Building, at 52 William Street in New York City, and agreed that they would maintain a price of about $40 a case, and Mr. Wisekopf and Mr. Jacobi and the other boys, who used to sell the whisky to the bootleggers during prohi- bition and who are now in the legitimate distilling busi« ness, proceeded to consider " what the traffic would bwur." The tax was of no consideration. If there were no tax at all. you would still be paying the same price for whisky today. That is the point of my argument. Or. if the tax were $10 a gallon, you would not be paying any more, be- CONGRESSIONAL Rl ICORD— HOUSE 116 cause there is a peak as to what the traffic wUl bear or what the public wiU pay. and the gougers cannot go beyond this even in spite of their gluttony. Now. let us see why the tax does not enter into the pnce you have to pay. [Here the gavel fell.l Mr. DOUGHTON of North Carolina. I yield the genUe- man 10 additional minutes. Mr. VIM SON of Kentucky. Will the gentleman yield? Mr O CONNOR. I yield, Mr. VINSON of Kentucky. While the gentleman says the tax Is not reflected in the present high prices, when com- petitive conditions occvu: and we get back to competition, would not the gentleman say that the tax would be reflected in the price of the product then? Mr. O CONNOR. Yes. If the tax were too high, it would. Mr. VINSON of Kentucky. In other words, a $10 tax might be prohibitive so far as money coming into the Treas- ury is concerned. Mr. O'CONNOR. Oh. yes, I will admit that; but here is what the gentleman loses sight of: I think it was Dr. Doran who appeared before the gentleman's committee, or one of the Treasury Department experts, and said, " The first year keep the tax low ; the second year increase it, and all the way up. " Why, that is ridiculous. It should be just the reverse of that. Mr. VINSON of Kentucky. I may say to the gentleman that I do not agree with that philosophy. Mr. O'CONNOR. The true philosophy in economics is just the reverse. The Goveriunent should be getting the tax while the getting is good; and this first year of flurry and excitement over repeal is the time in which to get it. Make the tax $5 the first year and when real com- petition does set in reduce it. if necessary. That is my theory, and the gentleman and myself are not in disagree- ment about it. Now. let us see how the taxes do not enter at all into the price you pay. Just take today and this minute, for instance. National EHstillers and Schenley will get. we will say. from the wholesalers, $34 a case for the rotten whisky they are putting out. We will not bother about it being cut 24 times, but we will assmne it is real whisky at $34 a case and on which they pay taxes of $3.30 a case. Hiram Walker k Co., Ltd., the Canadian distillery, which has just started a distillery in Peoria, HI., have their whisky in Canada and they have to pay tariff of $5 per gallon, the present tax of $1.10 a gallon, and other duties. The total taxes that they pay on a case of whisky by the time it is landed in New York is $22 a case, as compared with $3.30 that National Distillers or Schenley pay, and yet they sell their whisky for the very same price of $34 and make $5 a case profit. Can you tell me how the taxes enter into it? You can find out these facts for yourselves. The importer pays $22 taxes per case, as against the $330 a case that these fellows pay that have monopolized the domestic supply, and the importer still sells it for the same price and makes $5 a case. Do the taxes enter into that picture? Mr. FITZPATRICK. Suppose we took the duty off of Canadian liquor; would that bring down the prices? Mr. O'CONNOR. It should be taken off until the domes- tic supply is adequate and the monopoly is destroyed. Mr. FITZPATRICK. Until we drive the racketeers out of the business. Mr. O'CONNOR. Until we break the back of the Whisky Trust. Mr. FITZPATRICK. Absolutely. Mr. O'CONNOR. If you are going to legislate here in favor of the Whisky Trust, it is time the American people should know about it I repeat that you are not increasing taxes. The j^esent tax of $1.10 a gallon on whisky was 27 V^ cents a quart, and when you make it $2 a gallon you put it up to 50 cents a quart. In the past, however, when you paid 27^ cents, you got a quart of straight whisky; but what you get today is only worth one tenth of what you got before. So the net result is you are reducing the taxes. The distillers paid 40 January 4 1934 CONGRESSIONAL RECORD— HOUSE 117 pe -cent in taxes on a case of whisky before prohibition. If yoli put a tax of $5 a gallon on whisky at the prices today, it will be about the same rate of 40 percent. Doran suggested to me, while he was holding public omce that the distillers were a lot of extortioners, and sug- gested that we put an excess-profits tax on them. appreciate the difficulty about that. I realize the ille- ty of singling out any one class or any one business and ting an excess-profits tax on them alone; but if ycu v,-ill at the average prices charged today and figure the same of 40 percent, you will arrive at about my proposal of X of $5 a gallon. t U.S now see whether the taxes on the different alco- ic beverages are proportionate. The Rockefeller Founda- advocated that taxes be fixed in accordance with the al(ioholic content of liquor. ; am inclined to agree with that, but let us see what th< committee proposes to do. Let us compare the tax of $5 a barrel on beer and this proposed tax of $2 a gallon on whisky. In a barrel of beer there are about 250 salable glasses. With a $5 per barrel tax that amounts to a tax of 2 cents on each glass of beer. So when a man pays 10 cents, the average price, for a glass of beer, he pays a 2-cent tan on that beer. At $2 a gallon on whisky, the tax is ony 2V2 cents on each glass. Is that proportionate? Is th it fair? In other words, a man is going to pay 25. 40, or 50 cents for whisky — three to five times as much as for be;r — and the Government will only get an additional tax of one half cent. ^r. OT^ALLEY. Will the gentleman yield? r. O'CONNOR. Yes. OTklALLEY. The gentleman says there are 250 glisses of beer in a barrel. Will the gentleman state what siie glasses he means? r. O'CONNOR. Twelve ounces. r. O'MALLEY. I believe that the tax on beer is too h. r. O'CONNOR. That is what the brewers will contend. Yiu are taxing beer at 2 cents a drink and whisky at only 2' 2 cents a drink. That is not fair. The tax on whisky should be at least three times the tax on beer. Mr. MAY. Will the gentleman yield? Mr. O'CONNOR. I yield to the gentleman. Mr. MAY. The gentleman is favoring a tax of $5 a gal- lo 1 on whisky. Mr. O'CONNOR. That is correct. Mr. MAY. That is equal to 40 percent of the old selling pi ice, as the producer is manufacturing whisky for $12.50 a gallon. Mr. O'CONNOR. Oh. the gentleman is taking some fig- uies he heard here on the fioor. For making a gallon of w lisky the cost of 50 cents is more nearly correct. Mr. MAY. I was predicating my question upon the state- n ent of the gentleman from New York [Mr. O'Connor 1 , made a while ago, that a $5 tax would represent 40 percent of tie selling price, which would mean a selling price of $12.50 ptir gallon. Mr. O'CONNOR. I am talking about the selling price to tie consiuner. That is $3 a quart. Mr. MAY. If it costs but 30 cents — or even 50 cents — to produce a gallon of whisky, would not the bootlegger who poduces impure whisky be able, without any tax at all. to ujidersell the man who sells pure whisky that the gentle- nan favors, so that the public, the common man, will use tlie bad whisky instead of the good? Mr. O'CONNOR. Oh, the gentleman forces me again to St em to come to the defense of the bootlegger, whom I hate. S > far as this question of impure whisky is concerned, right Uday, the national distillers, Schenley. and those fellows aong the Illinois River are buying whisky from the boot- legger and cutting it 10 to 20 times. If you want to gilt further information about that, read my statement be- fore the Ways and Means Committee in which I mentioned tlie quantites they were bU3ring. For instance, about 1922 \ ellon sold a few hundred thousand gallons of Overholt to Uie bootleggers at about $3 per gallon. Of course, the Mellons knew that whisky was going into bootleg channels. They knew it was not going to be dispensed in Bellevue Hospital. Today the bootleggers have some of that whisky left — 77.000 gallons. I understand — and national distillers are negotiating to buy it back from them at about $14 per gallon, a fair price when they will cut it at least 15 times. The CHAIRMAN. Tlie time of the gentleman from New York has expired. Mr. O'CONNOR. Will the gentleman yield me some more time? Mr. COOPER of Tennessee. I yield the gentleman 2 addi- tional minutes. Will the gentleman yield? Mr. O'CONNOR. Yes. Mr. COOPER of Tennessee. In order to say in reply to the question of the gentleman from Kentucky [Mr. May], that the gentleman who appeared before the Committee on Ways and Means representing the Kentucky distillers made the statement that he would enter into a contract with any- body who wanted such contract to deliver old standard brands of Kentucky whisky for $5 a case. Mr. O'CONNOR. Surely. That is about what they were getting for it before prohibition, and paying a $1.10 a gallon tax or $3.30 a case. Mr. MAY. But that was on condition that they put a smaller tax on it than you are proposing in this bill. Mr. COOPER of Tennessee. No; there was no such condi- tion as that. Mr. MAY. Here it is in your minutes. Mr. O'CONNOR. This great bugaboo that high taxes mean a continuation of the bootlegger is so ridiculous, when you analyze it. that it should not frighten a child, let alone Members of Congress. During prohibition the boot- leggers have been conducting distilleries, and I am informed that they were very modern and efficient plants. The testi- mony before the committee was that these bootleg distill- eries turned out better liquor than the old distillers ever made. They had more sanitary distilleries than the old rum crowd ever had, I understand. Do you mean to say that in this country of ours, after repeal, a bootlegger can run a distillery? Perhaps he can have a still in his cellar or in the mountains, but you must remember that during prohibi- tion the American p)eople were the friends of the bootlegger. They would not inform upon him. They were sympathetic with him. Now, however, that the eighteenth amendment has been repealed, there are probably a million people going into the legitimate liquor business directly or indirectly, so you have added a million enforcement agents in the United States. You have a million informers, who will not permit a boot- leg distillery to operate. Oh, you will always have moon- shining. You would have moonshining if the tax were only 50 cents a gallon. You will always have some smug- gling, as you always have had, but you will never have any organized bootlegging industry if you use your efforts to cut down the present extortionate prices. I realize that in this particular bill, or in any similar bill, you cannot do much about the prices of liquor, but what I am contending for is that the Government of the United States should get a fair proportion of those extortionate profits. There is no reason why those profits should all go into the hands of a few ex- bootlegging distillers. Mark you further, that much of those extortionate profits will go out of the country. People in Canada control some of our largest distilleries in this coun- try. Bankers and people in England and in Scotland have very substantial interests in distilleries in this country. Much of those extortionate profits will go out of this coim- try, untaxed. Here we are reducing the taxes instead of increasing them, with many benefits going to foreigners. I hope, therefore, everyone here will support the amendment which I shall offer tomorrow for an increase in the tax on whisky, Mr. VINSON of Kentucky. Mr. Chairman, will the gentle- man yield? Mr. O'CONNOR. Yes. Mr. VINSON of Kentucky. With reference to the pro- posed amendment affecting labels, I call the attention of the } gentleman, as well as of the Members of the House, to regu- lation 20 under the Pure Food and Drugs Act, which reads as follows: (b) Cotnp>ounds and blends. In order to be within section 8. paragraph 4. in the case of food, subparagraph 2, shall bear on the label the word " compound " or '" blend ". as the case may be, and in addition a clear statement of the principal or essential Ingredi- ents of the article. And subsequent thereto, when it refers to the method of stating quantity or proportions: (a) The quantity of alcohol in a drug shall be stated In terms of the average percentage by volume of absolute alcohol In the finished product. Mr. O'CONNOR. I have not heard anybody state that those existing laws would cover the labeling of whisky. It seems to refer to drugs. As for blending, the gentlemen from Kentucky know that blending means taking whisky, and nothing but whisky, of different ages and putting it together, old whisky and new whisky. That is not what you are buying in your drug stores today, however. You are getting " cut " whisky, a small percentage of whisky and the rest raw alcohol. Mr. MAY. Will the gentleman yield for just a question? Mr. O'CONNOR. I yield. Mr. MAY. How many million gallons or hundred million gallons of rectified whisky do you suppose will be sold on credit of the million gallons of pure whisky we have in store? Mr. O'CONNOR. Oh, I would say that those million gal- lons of straight whisky will make at least 15,000,000 gallons of stuff that the American people will be compelled to buy. Mr. BRITTEN. Will the gentleman yield to me? Mr. O'CONNOR. Yes; I yield. Mr. BRITTEN. Has the gentleman indicated to the House what his amendment is to be? Mr. O'CONNOR. Does the gentleman mean the amount of the tax? Mr. BRITTEN. Yes. Mr. O'CONNOR. Five dollars a gallon. I do hope the House will consider the question over night. The amendment will be offered tomorrow. I hope you will reconsider any ideas you have had to this minute and think through this slogan that has been sold to you. that " high taxes mean a continuation of the bootlegger." I believe the answer to that deliberate propaganda is that high prices mean a continuation of the bootlegger, and as long as these high prices continue our Government, the American Government, should share by means of higher taxes. [ Applause . ] Mr. TREADWAY. Mr. Chairman, I yield 10 minutes to the gentleman from Illinois [Mr. Britten 1. Mr. BRITTEN. Mr. Chairman, I simply wish, in a few minutes, to corroborate some of the things that our good colleague, Mrs. Kahn, stated about California wines and to which I will add the Ohio and New York wines. There is going to be and there is today a lot of bootlegging in wines. Not all of the bootlegging is confined to hard liquor. Cali- fornia and Ohio and New York champagnes are being sold with fake French labels on them. The trick comes in listing the vintage. French wines ordinarily are very ch^tp. but just as soon as you put the vintage date on the bottle, the vintage of a good year, that wine is very valuable. It com- mands high prices; 1912 to 1919 French champagnes are almost out of the market. If you get a bottle of New York or California wine with a French label on it marked " 1912 " or " 1919 ". you will pay from $7 to $15 a bottle for it. If you buy it in a speak-easy, you will pay $20 for it, and you will get the same California or New York wines that you might buy under ordinary circumstances for $2.50 or S2. Tliere is so little difference between good American cham- pagne and wine and French champagne and wine that it takes a connoisseur to tell the difference. The bootlegger gets a vast difference in price. Bootleggers and speak-easies are selling falsely labeled champagne at very high prices. I am sorry that it is not possible, under the rules of the House, to offer an amendment to this bill that we will vote 118 CONGRESSIONAL upon tomorrow, that would provide for a complete embargo on French wmes and brandies. It ought to be done. It ought to be done in the Interest of good bmincas. It Wight to be done u a protective measure for the vineyards 7f America, and I tay that for two reasons. ^ , ^ My first reason U. of course, protection to the American producer. My second reason Is— and It is abnost as im- pcrunt as the first— that Prance Ls a defaulter nation. She d^-Lberately refuses to pay her honorable debU, although she has in gold— actual gold buUion in reserve— much more per capita than the United SUtes has. My friend from Michi- gan. Mr. WooDtcrr, reminds me that she has a lot of gold In this country earmarked. There was a time when we had a Department of 8Ute— ordinarily referred to in Europe as our diplomatic corps— that was not spineless and had the courage to guide us in our diplomatic relations in such a manner as to reflect credit upon the sterling Americanism of the Chief Executive. An Amencanism that commanded respect in every capital on earth. An Americanism that meant what it said and which did not deal in mere polite phrases. An Americanism which was not piloted by embassy dinners and champagne parties in Washington and cheap decorations which have been heaped upon thousands of important Americans by Fra-ace. I refer to the days of President Andrew Jackson, when Prance owed us a number of millions of dollars in honorable debts but persistently refused to pay. President Jackson politely but sternly notified France that unless she showed some disposition to be honorable and pay her Just debts America would seize such French commerce or French ships as might be available on the high seas and would credit her account with the value of such prizes. It did not require much time for the French Government to realize that the American Government meant what it said, and they forth- with arranged to pay their debt in full. Of course. I realize that State Department officials, from the highest to the lowest — and I am not referring to the present Secretary of State, because I regard him very, very hishly. and he has only been in office a short time — would Jeopardize their social positions in Washington if they were to advise harsh terms for European defaulting nations. It would mesm fewer invitations to the embassies. It would mean fewer dancmg parties where champagne flows like water. It would mean that their wives would not be listed among the special friends of the embassy hostesses, and this would be the saddest cut of alL Mr. O'CONNOR. Will the gentleman yield right there? Mr. BRITTEN. Yes; I yield to the gentleman. Mr. O'CONNOR. Did it ever occur to the gentleman to cite the example of Andrew Jackson to his late President, Mr. Hoover, and his Secretary of State? Mr. BRITTEN. I did just cite President Andrew Jack- son, and you may apply my language to the Hoover or to the Coolidge wr the Harding or the Wilson or the present Roosevelt administrations. Of course, Roosevelt has just come into office. If we have ever had a President during my membership in this House — which has been 21 years — who is fearless and who is distinctly courageous, it Is Franklin D. Roosevelt. [ Applause. 1 Very few men in any political walk of life have taken the chances he has taken in the last year, or that he intends to take in the present year. I hope to God they will all be successful. The hope of the world Is that they will be successful Up to the Twwc^nt mnm«nf t>i«>v hav» nnt h»An mmMurfiil hilt T r^stM^P. RKCORD— HOUSE January 4 ] Si. BRITTEN. No. The gentleman to getting me off my suJject. I am happy to say that I have every admiration fot Franklin D. Roosevelt. I knew him when he was Asslst- Secretary of the Navy under President Wilson, and I think I undersUnd his character and personality as well asTanyone does, and I could not help but feel on yesterday when he addressed the Home in person that he was the klid of a President who would ultimately in no uncertain language tell the defaulting European nations who have agreed among themselves to pay us nothing that unless thsy changed their dishonorable attitude he would bring about American reprisals which might cost them much more annually than their already greatly reduced obliga- ti(ns to us. Mr. Chairman, when the world depression made it im- pc ssible for Brazil to meet her debts to the French Govern- m;nt. France did not waste much time in diplomatic soft- soip. but on the contrary she immediately placed an em- bargo on Brazilian coffee— and France is a great consumer of coffee — and her future purchases of coffee went elsewhere as a reprisal to Brazil. Why cannot we treat France as sha treats others? We are a great wine-drinking Nation and if we must go abroad for this commodity, let us at least do bxisiness with honorable nations and those who regard us fcr what we are and not as puppets. Up to the present moment we have not had the courage to speak frankly to Fance and this I regard as an American disgrace. Our State Department has once more shown itself to be a SI ineless institution when it humbly consented to trade some Anerican apples and pears for a million and a half gallons ol French wines and brandies for importation into the United S ates at a time when the French Government is deliberately d ;f aulting in its pasrment of its debt of honor to us. To allow millions of dollars worth of French wines to sup- pi ant domestic wines on the tables of American consumers a< a time when France is hoarding bilhons of gold with w lich to ultimately harrass or destroy the monetary policy of President Roosevelt is indicative of a catering diplomacy wiich completely misunderstands popular sentiment to the c< ntrary. Defaulter France will later find excuse for not taking our ai)ples and pears, just as they have found subterfuge for breaking other agreements with us. This is the same France which after the war purchased fiom us $2,000,000,000 worth of foodstuffs, automobiles, b]ankets. and all sorts of wearing apparel for $407,000,000 and later forgot to pay us for it. They collected much more tian the amount due us through the sale of one half of our g)ods to their citizens and institutions. Ttiv& is the same French Government referred to by Gen. George Washington on July 13, 1797, for — [Their Inaldious hostility to our Government and their disregard 01 solemn treaties and the laws of the nations; their lawless am- b tlon and Intoxicated tx)wer, In contempt of every principle of Justice, and In violation of solemn compacts and of laws which g>vem all civilized nations. Since the dasrs when France gave our ministers their ^alkmg papers in 1796 they have always regarded American iplomacy as superficial and without courage. Our State Department could now well appropriate the ords of President Adams when he said: Such attempts ought to be repelled with a decision which shall mvlnce France, and the world, that we are not a degraded people mlllated under a colonial snlrlt of fear and sense of Inferiority, 118 CONGRESSIONAL upon tomorrow, that would provide for a complete embargo on French wiiies and brandies. It ought to be done. It ought to be done in the interest of good basincas. It Wight to be done a« a protective measure for the vineyards tI America, and I »ay that for two reasons. ^ , ^ My flrrt reason U. of course, protection to the American producer. My second reason Is— and It is almost as im- pcrunt as the first— that Prance Ls a defaulter nation. She df Lberately refuses to pay her honorable debU, although she has in gold— actual gold buUion in reserve— much more per capita than the United States has. My friend from Michi- gan. Mr. WooDturr, reminds me that she has a lot of gold In this country earmarked. There was a time when we had a Department of State- ordinarily referred to in Europe as our diplomatic corps— that was not spineless and had the courage to guide us in our diplomatic relations in such a manner as to reflect credit upon the sterling Americanism of the Chief Executive. An Am?ncanism that commanded respect in every capital on earth. An Americanism that meant what it said and which did not deal in mere polite phrases. An Americanism which was not piloted by embassy dinners and champagne parties in Washington and cheap decorations which have been heaped upon thousands of important Americans by Fra\ice. I refer to the days of President Andrew Jackson, when Prance owed us a number of millions of dollars in honorable debts but persistently refused to pay. President Jackson politely but sternly notified France that unless she showed some disposition to be honorable and pay her Just debts America would seize such French commerce or French ships as might be available on the high seas and would credit her account with the value of such prizes. It did not require much time for the French Government to realize that the American Government meant what it said, and they forth- with arranged to pay their debt in full. Of course. I realize that State Department officials, from the highest to the lowest — and I am not referring to the present Secretary of State, because I regard him very, very hishly. and he has only been in o£Qce a short time — would jeopardize their social positions in Washington if they were to advise harsh terms for European defaulting nations. It would mesm fewer invitations to the embassies. It would mean fewer dancmg parties where champagne flows like water. It would mean that their wives would not be listed among the special friends of the embassy hostesses, and tins would be the saddest cut of alL Mr. O'CONNOR. Will the gentleman yield right there? Mr. BRITTEN. Yes; I yield to the gentleman. Mr. O'CONNOR. Did it ever occur to the gentleman to cite the example of Andrew Jackson to his late President, Mr. Hoover, and his Secretary of State? Mr. BRITTEN. I did just cite President Andrew Jack- son, and you may apply my language to the Hoover or to the Coohdge w the Harding or the Wilson or the present Roosevelt administrations. Of course. Roosevelt has just come into office. If we have ever had a President during my membership in this House — which has been 21 years — who is fearless and who is distinctly courageous, it is Franklin D. Roosevelt. [Applause.] Very few men in any political walk of life have taken the chances he has taken in the last year, or that be intends to take in the present year. I hope to God they will all be successful. The hope of the world is that they will be successful Up to the present moment they have not been successful, but I realize most of them are theoretical and must be given a reason- able time in which to show their success or failure. Count- less millions of dollars are being expended xmder the ad- vice of " brain trusters " whose political leanings are as red as the wildest Communist: but even some of this money may prove to have been well spent. Only today the Presi- dent told us in his annual Budget message that this year would see our bonded debt t>etween Ave and six billion dollars more than it has ever been in the history of our Government. Mr. O'CONNOR. Will the gentleman yield further? RECORD— HOUSE January 4 1 4r, BRITTEN. No. The gentleman Is getting me off my suJject. I am happy to say that I have every admiration fo4 Franklin D. Roosevelt. I knew him when he was Asslst- Secretary of the Navy under President Wilson, and I think I undersUnd his character and personality as well asTanyone does, and I could not help but feel on yesterday when he addressed the Hoa-se in person that he was the kiid of a President who would ultimately in no uncertain language tell the defaulting European nations who have agreed among themselves to pay us nothing that unless thsy changed their dUhonorable attitude he would bring about American reprisals which might cost them much more annually than their already greatly reduced obliga- tUns to us. Mr. Chairman, when the world depression made It Im- pc ssible for Brazil to meet her debts to the French Govern- m;nt. France did not waste much time in diplomatic soft- soip, but on the contrary she immediately placed an em- bargo on Brazilian coffee— and France is a great consumer of coffee — and her future purchases of coffee went elsewhere as a reprisal to Brazil. Why cannot we treat France as sha treats others? We are a great wine-drinking Nation and if we must go abroad for this commodity, let us at least do business with honorable nations and those who regard us fcr what we are and not as puppets. Up to the present moment we have not had the courage to speak frankly to Fance and this I regard as an American disgrace. Our State Department has once more shown itself to be a si ineless institution when it humbly consented to trade some Anerican apples and pears for a million and a half gallons ol French wines and brandies for importation into the United S ates at a time when the French Government is deliberately d< ;f aulting in its pasnnent of its debt of honor to us. To allow millions of dollars worth of French wines to sup- pi ant domestic wines on the tables of American consumers a< a time when France is hoarding biUions of gold with w lich to ultimately harrass or destroy the monetary policy 01 President Roosevelt is indicative of a catering diplomacy wiich completely misunderstands popular sentiment to the c< ntrary. Defaulter France will later find excuse for not taking our ai)ples and pears, just as they have found subterfuge for breaking other agreements with us. This is the same France which after the war purchased fiom us $2,000,000,000 worth of foodstuffs, automobiles, b]ankets. and all sorts of wearing apparel for $407,000,000 ahd later forgot to pay us for it. They collected much more tian the amount due us through the sale of one half of our gpods to their citizens and institutions. Tius is the same French Government referred to by Gen. lorge Washington on July 13, 1797, for — Their Inaldious hostility to our Government and their disregard solemn treaties and the laws of the nations; their lawless am- ....tlon and Intoxicated ^wer, In contempt of every principle of Justice, and in violation of solemn compacts and of laws which g>vern aU civilized nations. Since the dasrs when France gave our ministers their valkmg papers in 1796 they have always regarded American diplomacy as superficial and without courage. I Our State Department could now well appropriate the 4ords of President Adams when he said: Such attempts ought to be repelled with a decision which shall cmvlnce Krance, and the world, that we are not a degraded people liumUlated under a colonial spirit of fear and sense of inferiority. fitted to be the miserable Instruments of foreisn Influence, and r igardless of national honor, character, and Interests. The same thing holds good today, and President Roosevelt could well take the language of General Wa.shington, Presl- < ent Adams, or President Jackson, and tell France where 8 le gets off. It was not done by Hoover, and it was not ( one by Coolldge. It ought to be done by RooMvelt. and I hope It will be when he comes to us in the near future, fls yesterday he said he would, and tells us about the Inter- national debts. Mr. MAT. Mr, Chairman, will the gentleman yield? 1934 CONGRESSIONAL RECORD— HOUSE 119 Mr. BRITTEN. I will yield to my good friend AmwKw Jackson May. Mr. MAY. Does not the gentleman from Illinois think, in view of France's conduct toward the payment of her honest debts, it is possible they might dig up an old printing press somewhere and print the figures " 1912 " on new wines and export them to America? Mr, BRITTEN, Of course they will do It, They are do- ing It now, I had a bottle of their old vintage Just the other day. Mr, MAY. The label will not honestly show the age of the vintage In the bottle, Mr. BRITTEN. I had a bottle of so-called " old vintage " from Prance the other day and I would not give a nickel for it. It was young and of cheap quality. Mr. FITZPATRICK. Mr. Chairman, will the gentleman yield? Mr. BRITTEN. I yield. • Mr. FITZPATRICK. What does it cost to make a bottle of American champagne? Mr. BRITTEN. I have not the slightest idea, but there is a champagne expert in the House. Where is the gentle- woman from California [Mrs. Kahn]? Mr, FITZPATRICK. It costs about 25 cents, and it sells for $4 a bottle; yet this is not called racketeering! [Here the gavel fell.] Mr. TREADWAY. Mr. Chairman, I yield 5 additional minutes to the gentleman from Illinois [Mr. Britten]. Mr. DELANEY. Mr. Chairman, will the gentleman yield? Mr. BRITTEN. I yield. Mr. DELANEY. Does not the gentleman think that if we had a substantial Navy, built up to our treaty rights, France might have a different aspect regarding the pay- ment of debts? Mr. BRITTEN. Of course, a show of force goes much further in Europe and in Asia than it does over here. I agree with the gentleman. But we have nothing to fear from the French Navy. It is French champagne I am worried about. [Laughter.] When we allocated the first 784,000 gallons of wine to Prance they came back for millions more. Someone said — I am quite sure it came from our distinguished President — '• Well, what are you going to buy from us? " Oh, well, they scratched their heads for a moment and then thought they might buy some of our fruit. That was a great trade! We said, "All right; will you take some of our pears and tome of our apples? " " Yes; we will take some pears." So they immediately agreed to take pears, and almost before the agreement was concluded they raised their tariff on pears so no one over there could buy them. Then we cut that allotment off again, and with a little diplomatic trading they finally agreed to take some of our apples and some more of our pears for 784,000 gallons of their wines and liquors. Now I am going to make a prediction — this will be printed in France tomorrow, and so probably my guess will be wrong — I make the prediction that if there is a way to be found in France to avoid the purchase of these apples and pears when finally they have been grown in this country and sent over there, France will refuse to take them on one subterfuge or another, just as she has done with her other international obligations. Her word is simply no good. We are not alone, as a nation. She does that with every- body, I hope that this committee one of these days — and the committee has the authority to do so— will bring in an embargo bill against French wines and French brandies so that not a drop can come into this country. When this has been done, and Prance Is given to understand that we are disgusted with her deceit and her shallow diplomacy, then, and only then, do I predict that she will meet her annual installments to us as any other honorable nation would who had hoarded a gold supply such as France now has. President Roosevelt shotild pull the mask of deceit from those European nations who have secretly conspired to follow France in her refusal to pay us, Frtnee, who can pay. has surrotmded herself by her debtor nations in solid opposftion to anythinf wMeh the United flUtes might desire, and I am quite satisfied that no one knows this better than the Prertdent himself. fApplfttne.] Mr. TRBAOWAY. I yield b mintitee to the gentlemftn from Wisconsin (Mr. Boaisv]. Mr, BOILCAU. Mr. Ch«innmn and Members. I beliere our first consideration should be the proper regnUitlon of the liquor traffic and the second consideration should be that of raising revenue. I do not believe that we can compete with the bootlegger if we raise the tax on liquor as hi|^ as is now contemplated. We contemplate a tax of $2 a gallon. It Is an assiu-ed thing that the various States will also place a high consumption tax on distilled liquors. Many of the States have already provided a tax of $1 per gallon. If we are going to throw upon the States the financial burden of enforcing the liquor laws and enforcing regula- tions. If we are going to put upon the shoulders of the States the responsibility of doing away with the evils of prohibition and bringing about a proper regulation of the liquor traffic, they are entitled to place a tax upon alcoholic beverages to defray the expwise thus incurred. Assuming that the States impose a tax of from 50 cents to $1 per gallon, the tax to the ultimate consumer will be $2.50 to $3 a gallon on the liquor. Let me say something to you about the so-called " blended liquor." If blended liquor is to be sold at around $1.50 a quart, I want to say to you that it cannot compete with the moonshine that is now being sold in some sections of this country, because, in the first place, it is not half as good, and, in the second place, it costs much more money. We must remember that during the last 13 years many people in this country have been making their living by manufacturing moonshine liquor. Although it Is not exactly pure, and it has some fusel oil in it, still there are some sec- tions of the country that have moonshine liquor 1 and 2 years old in considerable quantity. It is my prediction that in the near future they will be taking some of that moon- shine liquor and mixing it with the so-called " blended liquor " in order to give a better flavor to the blended liquor. I think it would be an improvement over the so-called " blended whisky " now being sold. Do you know what *' cut whisky " is? That is what they used to call " squirrel whisky." About two drinks of it and you would want to climb a tree. Blended whisky is not the grade of whisky the American people have been asking for. but that is about all that will be available for the present at least. I presiune that most of the good whisky will be used for blending purposes anil that the American people will be obliged to pay a tax of about $3 per gallon on blended whisky. I believe we should be liberal enough so that we will have a price on the so-called " blended whisky " low enough so that the people will not be tempted to buy illegally distilled liquor. Insofar as beer is concerned, I want to say that a tax of $5 per barrel is far too high. I have no brief for the brewers. I believe they have been overcharging the people since they have had the opportunity of selling legal beer. We were told by the brewers last spring that If we put a tax of $5 a barrel on beer that we would be able to get a good 5-cent glass of beer. It Is true you can go to some places today and get a glass of beer for a nickel, but it is one of those small glasses; and If you want a reasonably large glass of beer, you have to pay a dime for It at almost any place. I believe the American people should be permitted to obtain a reasonably good-sized glass of beer for 5 cents. Mr. DOUGHTON of North Carolina. WUl the gentleman yield? Mr. BOILEAU. I yield to the gentleman from North Carolina. Mr, DOUOHTON of North Carolina. Has the gentlemsA looked into the question ft enough to determine whethnr the eseewhre prlee of beer !• the fsttU of the toewer or the retailer? CONGRESSIONAL RECORD— HOUSE 120 ' . Mr BOILEAU. I beUeve it is largely due to the high tax that the Government has placed upon it and also due to the fact that the brewers are getting too much for their beer. Mr DOUGHTON of North CaroUna. When we levied a tax of So a barrel on beer, we were told by the brewers that thev could produce and sell good beer for 5 cents a glass. This is not being done, and I have wondered whether the trouble Ls with the wholesaler or the reUiler. Mr. BOILEAU. I believe the price that the manufacturer is getting for his beer is excessive, and I also believe there are too many places selhng beer, so that they have not the volume of sales. There should be some regulation of the matter. However. I do want to state that the tax we are placing upon beer is one of the factors contributing to its high price. In the old days when we were placing a Federal tax of $1 on beer, the breweries were delivering it to the retailer at $6 a barrel and getting $5 net for their barrel of beer. [Here the gavel felLl Mr. TREADWAY. I yield the gentleman 2 additional , minutes. I Mr. BOILEAU. At that time the breweries were chargmg $6. paying $1 tfjc to the Government, and getting $5 net for , the beer. ' In addition to this, whenever they delivered a barrel of beer to the saloon keepers, as they were called in those days, | the deliveryman was instructed to spend a dollar treating the customers. This made a net of $4 a barrel which they were getting for their beer. In addition to this, one man would go around at the end of the month and collect for the month s sales of beer and would spend all the way from 10 to 15 percent of what he collected in treating, so that the brewery actually received about $3.50 a barrel. I believe I can substantiate these figures in showing that they re- ceived $3.50 net after paying the tax, and so forth. Since we put the beer bill into effect, the breweries have been getting all the way from $12 to $16 a barrel, so that with the $5 tax and a State tax of $1, the breweries have been getting all the way from six to ten dollars a barrel net for their beer, wh ch is two or three times as much as they received before prohibition. It costs very httle more to manufacture and distribute beer today. I beheve they could cut down their price a good deal in order to assist in mak- ing beer available to the pubhc at 5 cents a glass, and I be- lieve the Government should contribute by reducing the tax on beer in order to bring down the price, and that the tavern keeper, or whatever you may want to call the person who sells beer at retail, would be in a position to sell a good 5-cent glass of beer and make a fair profit for himself. I believe the Federal Government should reduce the tax from $5 to $3 a barrel and should then expect the breweries to do their part in reducing the cost of beer to the public. [Applause.] Mr. TREADWAY. Mr. Chairman. I yield 5 minutes to the gentleman from Minnesota [Mr. Shoemaker]. Mr. SHOEMAKER. Mr. Chairman, practically all the discussion here this afternoon has been from the stand- point of a tax or an income. There has not been a thing said about the moral side of this question. I am going to touch on that for a few minutes, if I may. We have now. for about 13 or 14 years, trained every no-good rascal and his brother in this country on how to make whisky, and whisky has been made practically eve-y- where in the United States. I can personally vouchsafe the sutement tiiat in 7 months' tune in the Federal Peni- tentiary at Leavenworth, Kans.. laehind those four walls. there were 117 stills raided by the guards of the penitentiary. Everyone knows that liquor can be made very reasonably. The bootleggers, the moonshiners, and the still owners, still have their stills and know how to make it, and they are going to keep on making it as long as this imemployment problem is in existence, and they are not going to pay any tax, and they are going to be able to sell it far below what the legitimate dealer is going to be able to sell it for, even with a $2 tax. I should be more in favor of cutting the tax down to $1 a gallon and selling legitimate liquor and selling I January 4 ore of it. I believe the Government will get far more venue by doing this. I should also like to see an embargo placed upon French quors. The other day I happened to be a passenger on . boat and one of the passengers was an importer of iquor who has been in this business for many years. This uestion about the apples that Prance was going to take ame up. We had done a fine trick to France. We had ade them take our apples, and we were going to take -ench liquors. This man had just come from France, and e informed me that several years ago the French had got formula by which they were taking apples and making pplejack into cognac brandy. So the French are going send our own apples back here in bottles, and we are oing to pay big prices for them. So once more our own rape glowers and our people here who are producing the things necessary in the making of liquors will be goin-; without and the French will be bootlegging applejack cider far cognac brandy. Another thing about this liquor prob- em is this. When I was a boy— and this appUes to most of the Members of the Congress here— when we were aU youn? and went to a dance, if a girl sjnelled liquor on our breath she would not dance with us. If there happened to be a young lady who smelled of liquor, the boys were afraid to dance with her for fear they would be talked about. Since this prohibition went into effect I am informed that il you wanted to take a girl out the first thing she asked was, " Have you got a bottle? " That is what prohibition has done for us. and that is what we are going to get — we are going to keep on consuming bootleg liquor if you mako the price too high. But if you put it down cheap, as it was when Abraham Lincoln sold it for 25 cents per quart, the situation will be different, be- cause it costs a lot of money as it is now. Some young lady thinks she is having a good time because some young man is spending a lot of money. Some young man takes a girl out and she is disappointed because le does not spend a lot of money, and she says, " What do you think you are doing, trying to buy me for 25 cents' worth of cheap liquor? " We ought to bring back the morale that we had through the country before prohibition. We ought to get back to a civihzed state by placing these things on the basis of other countries where liquor is used. In France and Germany, where liquor is handled as daily consumption and for medi- cine and food, there is no drunkenness. If we would do that, we would do av.ay with bootleg liquor and all this crime that exists now, Mr. BRITTEN. Will the gentleman yield? Mr. SHOEMAKER. I yield to the gentleman. Mr. BRITTEN. In other words, it would cut out drunk- enness and promote temperance. Mr. SHOEMAKER,. Absolutely; and in the future you would not be pestered by bootleggers and criminals and the corruption of officers and legislators. If a high tnx is placed on liquor, it will encourage the illicit dealer, cau^,e the Government to have another large corps of enforcement officers, and once more cause our jails and penitentiaries to be filled v.-ith violators, which will cost tha taxpayers far more money than they can collect under a high tax on spirits. Keep the tax down, promote temper- ance, and eliminate the criminal and gangster. [Applause.! [Here the gavel fell.] Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield 5 minutes to the gentleman from Missouri [Mr. Coch- ran]. Mr. COCHRAN of Missouri. Mr. Chairman. I regret very much to find myself in opposition to the gentleman fioin New York [Mr. OConnorI, but today we are in complete disagreement. The gentleman wants to place a tax of five to seven dollars a gallon on whisky. In my opinion he seekjj to create a condition by an act of Congress that will be equivalent to the condition which existed under the eight- eenth amendment. Under the eighteenth amendment the rich could get all the good Uquor and wines they desired. To place a tax such as Mr. O'Connor suggests on whisky would create that same condition. The rich will be able to -^-.•^-.•».»-w-ir^r „ M.9»ii.215. 3 1903 45. lis. 3S5. 3 ioTH II 4.'>.611.873.3 1U0.V::I. 4.S.'i31.y~ 6 l«Ofi «. MX 257. 7 HW7 _ .„ 5H.7U3.50*-8 ](«< -- - - _ .vi. aw. H3H. 0 l'l 124 CONGRESSIONAL RECORD— HOUSE January 4 1934 CONGRESSIONAL RECORD— HOUSE 125 What I wanted to refer to more particularly was tikis: That it seems we missed a point when we did not allow some differential for nonbeverage alcohol used in the in< tries. One or two witnesses appeared before us representling the flavoring extract manufacturers, the National Associa- tion of Pruit and Flavoring Sirup Manufacturers, manulac- turers of soda-water flavors, and various commodities of this kind. We are assessing a very high tax on alcohol i^d in the industries. At the present time we are trying! to relieve industry of as many burdens as we possibly can in order to spur it to renewed activities. Now, on 190 ptoof it will cause an increase of $2^ per gallon, or 110 percent, in the cost of this most important ingredient entering Into the manufacture of such common household necessities as lemon extract and vanilla flavoring and various articles of that character. There will be no danger of diversion for beverage purp< ees as there was in the prohibition days. Under the regulati ons of the Treasury Department diversion for beverage purpi>ses bad almost disappeared from the picture. The Flavoring Extract Manufacturers Association, through its represerta- tive, stated: It aeems to our association and our Industry that the common ii«c«SBltl«« of life should not be injured by having the alcohol they use Included with the alcohol on which the proposed higher tax Is to be levied. We ask once more for a tax of $1.10 a proof- gallon on nonbeverage alcohol, and the Inclusion in the tax of the permit features of the National Prohibition Act of 1920. if the committee after full consideration of the case deems jthe retention of the permit system advisable. It seems to me we have overlooked this important matter, and I hoi>e that before the consideration of the bill is entirely closed we will give some attention to the various industries that use nonbeverage alcohol. Let me say that in 1917. when the tax was $2.20 on n)n- beverage alcohol, we had $3.20 on the beverage alcohol, and again, in 1918, when we raised beverage alcohol to $6.40,1 we let the tax on nonbeverage alcohol remain at $2.20. Mr. DOUGHTON of North Carolina. I yield 10 min to the gentleman from Maryland [Mr. PaljcsanoJ. Mr. PALMISANO. Mi. Chairman, to a certain extent I agree with the committee on this bill. I feel that a $2 Is a reasonable tax. I am also in accord with the committee insofar as the wine tax is concerned, but I differ with Lhe committee on the so-called " beer tax." In looking at the bill you get the impression that the jtax on beer was $6 prior to prohibition, and that they are re< ing it now to $5, a reduction of $1. The truth of the matter is that the tax from the year 1862 until the year 1914 ^as $1, with the exception of a year or two immediately after the Civil War and a year or two immediately after jthe Spanish War, at which time the tax was increased to $2. The following was the tax before prohibition : The taxi on l)eer from 1862 to Bfarch 3. 1863, was $1 a barrel; fi>m March 3. 1863. to March 31. 1864, 60 cents a barrel; fifem April 1, 1864. to June 13. 1898. was $1 a barrel; from jine 14. 1898, to June 30. 1901. during the Spanish -American War. the tax was raised to $2 a barrel; from July 1. IMl. to June 30. 1902. it was reduced to $1.60 a barrel; on Jiily 1, 1902, it was again reduced to $1, and continued at lihis rate until October 22. 1914. I contended before the Ways and Means Committee, as shown at page 355 of the committee hearings, when they were considering the Collier bUl. that we would not obtain under the $5 tax a 5-cent glass of beer. I contended at tkat time that beer would sell at from $10 to $12 per barrel whe if a of $1 of of business, under that handicap, it would have to put on another tax of a dollar to defray the expense. Mr. OTi^ALLEY. A $5 tax on a gallon of whisky would make a pint of whisky bear a tax of about 60 cents. I would like to be able to buy a pint of good whisky for about $1.50. I think the difference between 60 cents and $1.50 is quite enough for the manufacturer. Mr. BOILEAU. That is twice as much as It cost before prohibition. Mr. HOEPPEL. And you can buy good bootleg liquor in San Francisco for 35 cents. Mr. O'MALLEY. Yes; and the bootlegger has to manu- facture it and get somebody to sell it. the same as the Whisky Trust that is charging 10 tiroes that price. Mr. MEAD. Mr. Chairman, will the gentleman yield? Mr. O'MALLEY. Yes. Mr. BiEAD. The gentleman from Maryland fMr. Palmi- SAjrol Intimated that an effort would be made to lower the Ux on beer to $2 when the bill is under consideration und?r the 5-minute rule. It occurs to me that an effort should be made to diminish the ux on beer, I would Uke to have the gentleman's idea as to what the tax on beer should be. Mr. O'MALLEY. I think the Ux U plenty at $2, but I would be willing to comirt-omlse on $3 because then we would have made an advance. Mr. MEAD. And it occurs to me that a unified effort should be made so that we could bring that about. Mr. O'MALLEY. I agree with the gentleman. I yield back the balance of my time and ask uxutnimous consent to revise my remarks. The CHAIRMAN. Without objection, it Is so ordered. Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield 5 minutes to the gentleman from Ohio (Mr. TruaxI. Mr. TRUAX. Mr. Chairman, before I came down here I was convinced that our tax on hard liquor ought not to exceed $1.10, which was the old tax. I think that we have one of the most difllcult Ux situations in the State of Ohio of any State in the Union. At the last November election we adopted an old-age pension law that will cost the State in the neighborhood of $30,000,000 a year. We adopted a 10-mill limitation on real estate, which will necessitate about $18,000,000 more revenue being raised from some additional source. The gentleman from New York I Mr. O'Connor] said that the Ux on liquor does not always determine the selling price. But if we should levy a tax in excess of $2 a gallon, the tax recommended by the Committee on Ways and Means — and I think we owe those gentlemen a debt of grati- tude for the many long hours they have spent in the study of these perplexing questions — I believe, regardless of whether we make the tax $1 or $2 a gallon, that a State like the State of Ohio will immediately levy the highest possible tax they can on the gallonage consumed in that State. We have already adopted by State legislation a form of SU-e morwpoly for liquor control. This has been very dis- tasteful to many of our people. As the gentleman from Maryland tMr. Pau^isano) said awhile ago, I personally favor giving the little fellow in business — the man who is now handling beer — an opportunity to dispense wine and liquor and make a living thereby. ! Now, I want to say a word about various subjects that have been discussed here and espacially as regards moon- shine whisky. We have several different grades of moonshine in Ohio. As another gentleman said to me. in many cases the genuine distilled corn liquor or rye liquor back in the hills and valleys of Ohio is the highest grade liquor we are dispensing today. I Two weeks ago the Columbus Citizen gathered up a num- 1 ber of samples of liquor sold by the drug stores. We have an emergency provision that permits drug stores to sell liquor for 60 days. They had three brands. One brand of bonded ! whisky. 16 years old, sold for $3.50 a pint; the second was a blend of whisky sellinsjor $1.85 a pint; and the third was the Stratesville moonshine, which. I have no doubt, is known to every Member of the Ohio delegation. [Laughter.] I did not mean that they had personal knowledge of it, but they 1934 CONGRESSIONAL RECORD— HOUSE 127 have heard of it. The Stratesville moonshine, by chemical test and analysis, proved to be the purest Uquor of the three. They found that grade no. 2. selling for $1.85, some of it was blended with liquor that formerly was denatured but had been precipitated and blended into whisky. Mr. DOUGHTON of North Carolina. I yield the gentle- man from Ohio [Mr. TruaxI 1 additional minute. Mr. TRUAX. They foimd that all of these second grades were artificially colored with caramel, and they foimd that grade no. 1, selhng for $3.50, was cut three times. The orig- inal whisky. 16 years old. was cut three times with equal parts of distilled water and pure grain alcohol. So I say to you gentlemen that we have a perplexing problem on our hands. In the name of Justice to all the people who are going to consume liquor because they have the appetites, let us keep the Ux as low as possible, because when the various States get through with their Uxes that liquor will have to sell for at least $2 a quart, which cannot compete with our good old Stratesville Uquor at $4 a gallon. [Laughter and applause.! The CHAIRMAN, The time of the gentleman from Ohio fMr. TkuaxI has again expired, Mr, DOUGHTON of North Carolina, Mr, Chairman, I yield 3 minutes to the gentleman from Pennsylvania IMr. Dunn J , Mr, DUNN. Mr, Chairman. I agree with those who main- tain that If we put an exorbitant tax on liquor we will have bootleggers, I am not going to say any more about that because I know I cannot persuade anybody, no matter how much time I may consume In argument, to believe as I believe. However, I do want to say something about a statement made on the fioor this afternoon In regard to France, It has been said that an embargo should be put on French wines, and the gentleman who made the state- ment also said, or at least I understood him to say, that the French people were cheats. I disagree with that gentle- man. I will agree with him in saying that some of the French people are cheats. In fact we do not have to go out of this country to find cheaters. In every nation in the world there are cheats; but I do think that the people in France, as a class, are a great people; and I do believe that the people in every country In the world are great people. It is true there are unprincipled demagogues in every nation; and I do not doubt, if it were left to the masses of the people in France and every other country which owes the United States money, they would pay their honest debts. It is the crooked politicians of Europe. Asia, and Africa, and in the United States, who do not want to pay their debts. The CHAIRMAN. The time of the gentleman from Pennsylvania [Mr. DunnI has expired. Mr. DOUGHTON of North Carolina. Mr. Chairman. I yield 2 minutes to the gentleman from California [Mr. Buck]. Mr. BUCK. Mr. Chairman. I have been listening so long to a discussion of taxes on whisky and beer, that I thought it behooved me to come here and say a word about the wine sections of this pending bill. No one is interested in having the taxes on the particular commodity in which he is interested increased. Dry wine of itself is an agricultural commodity pure and simple, natu- rally fermenting without the aid of anything except nature itself. We asked the committee in all seriousness to con- sider the elimination of any tax upon dry wine or wines under 14 percent alcohol capacity. We presented a schedule of taxes which we felt would be fair and which should be the maximum if the committee adopted any taxation at all for wines. I want to take this opportunity of saying that the Ways and Means Committee acted fairly and courteously to the wine producers and the wine growers of California, and that the schedule they have set out in their bill is one that will be accepUble and that will prevent bootlegging and still will encourage the development of the wine industry throughout California. I regret to hear that any Member of the House presented the suggestion that we should place an embargo against the imporUtion of wine from any other country. I say this because, as one who has been a grower himself and who has been interested, though not at the pnaent time, in the wine industry, I feel that future years to come will ne^ the addi- tion of foreign wines. We have sufficient tariff protection against the imporUtion of cheap wines at the preaent time to keep those out. We need the addition of foreign wines so that we may educate the people of the United StaUs to the sane and temperate drinking with their meals of what really is a food and should not be looked upon as an intoxi- cating Uquor. Wine should never be classed or grouped with whisky or high whie spirlU, brandy, and the others. I say, therefore, that I do hope that no suggestion will be made as to an embargo preventing the ImporUtion of wines from any other country. In so speaking I assure you I represent not only myself but the wine producers of the SUte of California, (Applause.] The CHAIRMAN, The time of the gentleman from Cali- fornia IMr, BvcKl has expired. Mr. DOUOHTON of North Carolina, Mr. Chairman, I yield 3 minutes to the gentleman from Mlehifan IMr. WnoncAif], Mr, WEIDEMAN. Mr, Chairman, you have heard a lot of argument about the fact that if the Ux on liquor is high the bootlegger will be in competition with good liquor, I do not think so, I think the people of this country are a part of this new deal and that they will sUnd behind the law- enforcement officials and convict bootleggers as fast as they are brought Into court. I happen to be a lawyer, I have seen the action of Juries, In the city of Detroit the city officials got very few convictions for violations of the liquor laws for several years. Now in the vast majority of cases the Juries are convicting the accused. They want the laws of the United States and of the State of Michigan upheld. The rank and file of the people throughout the country are the same way, I do not think we will have much troubls with that. I think the people wlU stand behind the Oov- errunent on this law, no matter what the tax is. PBOMOTION or TZMPZRANCK BHOTTLO BC AIM OF LAWS I believe that the prohibition law was repealed by the people of this country to return to them that personal liberty of which they were deprived by the eighteenth amend- ment. No one wanted to repeal the eighteenth amendment to develop whisky drinkers, but it was repealed to promote i the cause of temperance. We can do more to promote tem- perance by giving the working people of this country a good glass of beer, which is a wholesome beverage when used with moderation, than we can in any other maimer. It is our duty to see that they get it without the imposition of an exorbitant tax. I am confident that the law-enforcing agencies wiU enter upon the enforcement of our laws with a new zeal and vigor when those laws are such that they themselves can conscientiously enforce. They will be backed up by the citizens throughout the length and breadth of the land. I want to compUment the committee on the wonderful work they have done in this bill. I am satisfied with it. although if I were on the committee I might have urged a lower tax on beer in order that we might bring back the 5 -cent glass of beer. The trouble in this field is that the brewers are trying to recoup in the period of a year the losses they have suffered throughout the years, but I am satisfied that eventually we shaU have the nickel glass of beer back generally. We have a nickel glass of beer in Detroit and the people are satisfied with it. We are going along with the committee in its program. I am satisfied the people of this country are going to stand right behind this House, right behind the Senate, right behind the President, and the law-enforcement officials of the country in their campaign against violators of the law. As this is a revenue-producing biU I am going to sUnd by the committee. [Applause.] Mr. Chairman. I s^eld back the balance of my time. Mr. DOUOHTON of North Carolina. Mr. Chairman. I yield 3 minutes to the gentleman from Michigan [Mr. Sadowsxi]. 128 CONGRESSIONAL RECORD— HOUSE January 4 too sal- Mr. SADOWSKI. Mr. Chairman. I am interested in tliis tax bill Every citizen in my district is interested in getting ?ocd Suor. g^d beer at a cheap price. That i- Jhe Prux^^ Uiing of interest to them. I am gomg to go along on tins tax bill with their viewpoint in mind. „„tio« «« I know that at the present time what other gentlemen from large cities have said is the truth In regard to beer Srman'who sells beer, who handles the «la» of b^r at reUil, is today working for the brewery. He is not makjng r hving at it. He can hardly pay his rent. This is the truth The places which sell beer at a nickel a glass ire not making any money. They are just cutting each othdr s throat in the business and there really is no profit m iie retail end of the beer business today. _ »,^, We could help this situation by making the tax on ceer about $3 a barrel. This still would be $2 more than it uas in the days before prohibition. . ^ . We should not expect the beer and liquor industry to carry the full load of this taxation. They are indus^es just as much as any other industry. We must bear in mind in this matter of taxation that our SUte governments are bankrupt, that they are badly in need of new revenues ind wiU look to these new industries. We must take this nto consideration and not overload them with Federal taxes. Now. of course. I want to go along with the administra- tion on this bill. I want to go along with the commitjtee. but I would like to see liquor taxes lowered. I think that $1.10 per gallon is plenty, and that $2 is high a tax on whisky. I know that in Detroit today a 5- k)n can of moonshine can be brought for $15. This is ffiu-ly ; good whisky. It certainly is much better than this so-ca|lled " blended whisky " that is being sold at the liquor stor^ at $3 and $4 per quart. The average citizen cannot affoni to pay these high prices for legal whisky. If the pric(( of legitimate whisky is too high, these feUows will buy the cheaper moonshine whisky, as they have been doing right along. [Here the gavel fell.] Mr. TREADWAY. Mr. Chairman. I yield 2 minutes to the gentfeman from Connecticut [Mr. Gossl. Mr. OOSS. Mr. Chairman. I wish to ask the chairman of the committee a question in reference to section 3, the sec- tion deahng with perfumes. As I understand it. under the amendment of the old law all perfumes that are impcrted into this country which contain distilled spirits, regardless of whether they are denatured spirits or not. would reccdent to a consideration of granting independence to the is- ands. I respectfully submit that this condition precedent having been fulfilled It is now our liberty and our duty to keep our promise to the people of those Islands by granting them, the Independence which they so honorably covet. The Democratic Party pledged itself in unequivocal terms as to the immediate grant of independence to the Philippines. The Philippine plank inserted and adopted by the Demo- cratic Convention of 1920 says: We favor the granting of Independence without unnecessary delay to the 10,500,000 Inhabitants of the Philippine Islands. In 1924 and again in 1928 the Democratic Party adopted In convention the following Philippine plank: The Filipinos have succeeded In maintaining a stable govern- ment and have thus fulfilled the only condition laid down by the Congress as a prerequisite to the granting of Independence. We declare that it Is now our liberty and our duty to keep our promise to these people by granting them Immediately the Independence which they so honorably covet. And in 1932 the plank read: We advocate independence of the Philippines. In view of the continuous pledges of the Democratic Party now in control of the executive and legislative branches of the Government of the United States, and in view also of the persistent expression of wishes of the Filipino people to live an independent life at the earliest practicable time, there is nothing left but for the Congress to enact a law directing the President to proclaim and recognize the independence of the Philippine Islands immediately after the inhabitants therein have organized a government, or to enact a law along the lines suggested in the Concurrent Resolution No. 46 of the Philippine Legislature, to which I have referred. The details of the transfer of American sovereignty to the Philippine independent government can be worked out by the Committee on Insular Affairs of this House and of the Senate in consultation with the constitutional representa- tives of the Philippines in the United States. It is not out of place at this juncture to remind that tlie United States has assumed certain responsibilities in the grant of independence to the Filipino people that cannot in Justice be avoided without betraying the trust that she assumed as an aftermath of the war against Spain. While the grant of independence was and is the goal of American aim and purpose in the Philippines, the welfare and happiness of the inhabitants therein are also their main concern. The American flag was hoisted in the Philippines not as a symbol of conquest but as a token of a definite mission to be undertaken. The Philippines were not to be disposed of at the conqueror's pleasuie or as his interests demand, but in accordance with certain principles of humanity and in harmony with the policy set forth since the inception of that occupation. President McKinley in his exposition of the motives of the occupation in the Philippines said in the speech delivered at the Eleventh Annual Banquet of the Home Market Club, Boston, Mass., February 16, 1899; Lxxvni 9 The evolution of events which no man could control hMM brought these problems upon us. Certain It is that they have not 'xime through any fault on our own part, but as a high obUgatlon, and wc meet them with clear conscience and unselfish purpose, and with good heart resolve to undertake their solution. He continued, saying: The Philippines, like Cuba and Puerto Rico, were Intrusted to our hands by the war. and to that great trust, under the pro- vidence of God and in the name of human progress and clvlUsoi- tlon, we are committed. It is a trust we have not sought: It is a trust from which we wlU not flinch. And added: Our concern was not for territory or trade or empire, but for the people whose interests and destiny, without our willing It, had been put In our bands. In the light of this declaration of purpose. It becomes evident that the establishment of American sovereignty over the Philippine Islands was not founded upon the simple issue 'of whether independence should be granted. If the grant of independence were the only basis of the American occupation of the Philippines, it could have been accom- plished either before the ratification of the Treety of Paria between Spain and the United States or after its ratifica- tion. Of course, annexation of the Philippines to the United States is out of the question. The two major parties of the United States; that is, the Republican and the Democratic Parties, are both committed to the proposition that the war against Spain was not for territorial aggrandizement or con- quest, and much less for the subjugation and exploitation of a less fortunate people. The establishment of American sovereignty over the Philippines was founded upon high motives. These were and are the humanitarian endeavors to be made by this Nation — to secure for the Filipinos economic independence and to lit them for complete self-government, with the power to decide eventuaUy. according to their own largest good, whether such self-government shall be accompanied by independence. (President Taft in his message to Congress on Dec. 0, 1912.) It is my expectation that the Congress of the United States will solve the Philipiwne problem in a way satisfactory tor the best interests of both countries. I am sure that the United States will fulfill her pledge to grant independence to the people of the Philippine Islands under conditions and circumstances that will not imperil their political, social, and economic stability. For the best understanding of this House, I wish to submit, and therefore ask unanimous consent to insert in the Record, the Concurrent Resolution No. 46, of the Philippine Legis- lature. The resolution is as follows: Concurrent resolution informing the Congress of the United States that the Philippine Legislatvire, in its own name and in that of the FUipino people, declines to accept the act of Congress entitled "An act to enable the people of the Philippine Islands to adopt a constitution and form a government for the Philip- pine Islands, to provide for the independence of the same, and for other purposes ", in Its present form and appointing a com- mittee to proceed to the United States at the earUest practicable time to seek amendments to said act of Congress or the enact- ment of such new legislation as will fully satisfy the aspirations of the Filipino people to become at the earliest practicable date a free and Independent nation, under conditions and cir- cumstances that will not imperil the political, social, and eco- nomic stability of their coxmtry Whereas the Congress of the United States on the 17th day of January 1933, enacted a law entitled "An act to enable the people of the Philippine Islands to adopt a constitution and form a government for the Philippine Islands, to provide for the inde- pendence of the same, and for other pxirpoees ". commonly known as the " Hare-Hawes-Cutting law "; Whereas section 17 of said law provides that the provisions of the same " shall not take effect until accepted by concurrent reso- lution of the Philippine Legislature or by a convention called for the purpose of passing upon that question, as may be provided by the Philippine Legislature "; Whereas the Philippine Legislature fully appreciates the good win shown by the Congress of the United States toward the people of the Philippine Islands and its efforts to finally settle the Philippine question by enacting said law; Whereas the Philippine Legislature believes that In providing that the said law shall not take effect until accepted by the Philippine Legislature or by a convention called for the purpose of pacing upon that question, the Congress of the United Statci i CONGKESSIONAI, RECORD— HOUSE 130 intended to secure a frank and honest expression of the wlU o the Filipino people reRardlng f.ie above-mentioned law; and Wherearthe Philippine Legislature is opposed to the acceptance of said law in its present form because, in the opinion of thi^ legislature, the law does not satisfy the national aspirations, no- docH it safeguard the welfare of the Filipino people or the sta bmty of the social, economic, and political Institutions of the.- ^TelUJZtTnius'e^ilpres^tatives itKe PHUlppine SenaU conrumnj; (.'That the Philippine Legislature In its own nams and in that of the Filipino people. Inform the Congress of ths United States that It declines to accept the said law In Ita pres- ent form because. In the opinion of the legislature, among other reasons the provisions of the law affecting trade relations between the United States and the Philippine Islands would seriously im- peril the economic, social, and political Institutions of this couiu- try and might defeat its avowed purpose to secure Independencs to the Philippine Islands at the end of the transition period: be- cause the immigration clause Is objectionable and offensive to the Filipino people; because the powers of the high com.mlssloner are too indcnmte; and Anally because the military, naval, and other reservations provided tor in the wild act are inconsistent wlti true independence, violate national dignity, and are Bubjfect to misunderstanding. ^ ^^ ResolKd further. That a Joint legislative committee of the sen - ate and the hoxise of representatives be appointed, as it is hereby appointed, subject to the directions, purposes, and authority herein stated, to be composed of the Honorable Manuel L. Quezon, president of the Philippine Senate, as chairman of the committee on the part of the Philippine Senate; the Honorable Qulntia Paredes speaker of the house of representatives, as chairman . majority floor leader of the senate; Hon. Jose C. Zulueta. majority floor leader of the house of representatives; Hon. Sergio Osmen k. ,jenator from the tenth district; and Hon. Pedro Guevara. Res - dent Commissioner to the United States, and that an Invitation be. and Is hereby, extended to Gen. Emlllo Agulnaldo. president of the erstwhile Philippine Republic; Hon. Juan Sumulong. foi - mer icnator; and Hon. Isauro Gabaldon. former senator and Res- dent Ccmmissloner, to Join said legislative committee and form a part thereof. General Agulnaldo as honorary chairman and tie others as members. The committee thus constituted shall proceed to the Unlt( d States as soon as convenient in the Interest of the public servire and convey to the Congress of the Unite, • The committee shall, at the same time, express to the Goveru- ^-taent and people of the United States the objections to the sad law and the reasons therefor, and petition the President and tlie Congress of the United States for changes therein or the enact- ment of such new legislation as will fully satisfy the aspirations of the Filipino people to become at the earliest practicable date a free and Independent nation, under conditions and clrcumstanc?s that will not imperil the political, social, and economic stabill:y of their country. The Philippine Leglslatxu-e approaches the Government and pej- ple of the United States through this committee In the hope and confident expectation that they will not Ignore the appeal of tie Filipino people — a people who. In the language of every Amerlo.n President since the Inauguration of American rule, have bein placed by Divine Providence under the protecting care of tie American Nation so that they may enjoy the blessings of freedom and happiness which are the heritage of the people of the United States. Adopted October 17. 1933. TTie majority of the Philippine Legislature in passing Coi i- current Resolution No. 46 declining to accept Public Act "~^No. 311 acted in accordance with the specific provisions af section 17. This section gives the Philippine Legislature tlie right and privilege to accept or reject the law. In the exe r- cise of this right granted by the Congress of the United States. Public Act No. 311 was not accepted. I venture to say that the Philippine Legislature in adopt- ing Concurrent Resolution No. 46 acted upon the belief and hope that the Congress of the United States would not >e indifferent to a prompt solution of the Philippine problem In accordance with its wishes. It has taken into considerati( »n the pledges of the Democratic Party now in power and basi !d its action upon these pledges. These pledges are construed to mean that in the grant of independence provision should be made in such a way as to ipermit the Filipino people to maintain that independence by not thwarting their eco- nomic progress, attained through the leadership and gen- erous assistance of the American people. The free-trade January 4 1934 CONGRESSIONAL RECORD— HOUSE 131 relations between the United States and the Philippii Islands were established in 1913 in the Underwood -Simmohs Tariff Act for the purpose of encouraging the economic ds- velopment of the Philippines in order that when the tims came to grant its independence it might be in possession of some instrumentalities essential to the life of an independent government. The limitation fixed in the Hare-Hawes- Cutting law as to the amount of sugar and cordage that may be exported to the United States duty free is considered contrary to the avowed purpose of the United States, for it would mean the strangulation of the Philippine economic structure and. it is felt, would defeat the grant of inde- pendence. On the other hand, opinion here is that the Filipino people should stand courageously the initial diffi- culties of independence. While the Filipino people aro prepared to sacrifice everything that is dear to them for tha attainment of the ideals for which their forefathers fought in the past, yet it is their profound hope that as long as the United States has undertaken the mission of leading then to their place in the concert of nations, she will not ask of them sacrifices which may eventually cause their collapse, thus inviting some greedy nation to grab them. If this tragic eventuality becomes a reality. I am sure the United j States would not be happy and proud of the deed, which I should add to her history a glorious chapter of human en- I deavors. Even the economic calamity which is whipping i every nook and corner of this the most powerful and wealtny Nation in the world would not be sufficient human excuse for the failure of Philippine independence. It is high time to remind that the Philippines have been kept under the American fiag under her sole responsibihty. Whether or not it is the consequence of party policy is out of the ques- tion. It should be construed as a national responsibility. The Democratic Party now in power speaks for the American people. Its policy as expressed in its platform, adopted in solemn convention in 1932, should be fully executed as far as it concerns the people of the Philippine Islands. Before cQnclading, I wish to take advantage of this oppor- tunity to apprise the Congre.ss of the United States that a committee of the Philippine Legislature, presided over by Manuel L. Quezon, president of the Philippine Senate, and the acknowledged leader of the Filipino people, is now pres- ent in Washington. Now. Mr. Chairman. I believe that I have fulfilled my duty as I see and understand it. I join cordially with this com- mittee sent by the Philippine Legislature to the United States to enter into negotiations with the constitutional agencies of this Nation to settle once and for all the Philip- pine question in a way compatible with the responsibilities of the United States, whose honor has never been ques- tioned, and in harmony with the best interests of the Filipino people. [Here the gavel fell.] Mr. GUEVARA. Mr. Chairman. I ask unanimous consent to extend my remarks in the Record and to include therein Concurrent Resolution No. 46 of the Philippine Legislature. The CHAIRMAN. Is there objection to the request of the Resident Commissioner from the Philippines? There was no objection. Mr. TREADWAY. Mr. Chairman, my remarks on the pending bill will be very brief. I simply want to make an explanation of the attitude taken on this bill by the minority members of the Ways and Means Committee. A subcommittee of the Ways and Means Committee was appointed under a resolution adopted last June before the special session adjourned to study tax avoidance and any new tax matter that might come up. Realizing, of course, that repeal of the eighteenth amendment by the adoption of the twenty-first amendment was imminent, the first task that the committee undertook on its return here on the 23d of October was an effort to see whether or not we could suggest a satisfactory rate on distilled spirits that would bring a sufficient and satisfactory revenue to the Govern- ment and at the same time not play into the hands of the bootleggers. We soon found it was very difficult to secure any expert advice or evidence. Through the chairman of the subcom- mittee, Mr. Samuel B. Hill, who has been tireless in his efforts on behalf of the work of the subcommittee, we asked various people to come before us representing the Govern- ment. We waited for a day or more and found they were not available. We then found there had been authorized by the administration a so-called " interdepartmental com- mittee " to study the very problem that we felt was a tax problem of the Congress, and the men we looked to for advise and assistance seemed to be either members of th'^ committee or tied up to testify before them and, as I have said, were not available to us. A little later we found that there was an evident move on the part of the administration to license distilleries and then set up a Government corporation that would buy from the distilleries all they were allowed to manufacture under their respective quotas, and then make an arrangement whereby the corporation would supply the States'with their fair share of legalized liquor. Evidently this plan appeared to be impracticable and probably unconstitutional. We then received the report of the interdepartmental committee, and that report recommended a method of coop- eration between the Federal Government and the States and also recommended a tax of $2.60 per gallon. This tax was to include such allotment as the Government saw fit to make to the various States. We then had some hearings and among our early wit- nesses was the gentleman who had been selected by the President to have charge of the quota importations by the various governments until Congress could legislate in the matter. Mr. Joseph H. Choate, of New York, an eminent lawj'er, son of a former Ambassador to Great Britain, and a very distinguished statesman of a few years past. Mr. Choate was Administrator of the Federal Alcohol Control Board, and he testified he felt that unless it was practicable to get this arrangement between the States and the Federal Government, the rate of $2.60 might be too high. He also stated it was probably a task requiring time to educate the States up to this agreement of an allotment being made by the Federal Government to the States. Attention was called to the fact that revenue would be lost by this delay. This was as far as that proposition went. A httle later members of the majority of the Ways and Means Committee were evidently invited to the White House and either the following morning, or the second morning after that small gathering, the proposition was presented that the tax on distilled spirits should be $2 per gallon. Mr. O'CONNOR. WiU the gentleman yield there? Mr. TREADWAY. Yes; I yield for a brief question. Mr. O'CONNOR. Speaking as a Democrat and one having some connection with this administration, I do not believe the White House ever said one word as to what the tax on distilled spirits should be. and I would not believe it unless it was absolutely proven to me. Mr. TREADWAY. Did I say so? Mr. O'CONNOR. Oh, I believe the gentleman had the information, but I do not believe the White House ever uttered any such suggestion. The White House has been ^ " sold " around here for a year. Mr. TREADWAY. I should be pleased to have the re- porter read exactly what I said. I did not say that any word was given to the committee from the White House as to what the rate should be. did I? Mr. O'CONNOR. I understood the gentleman to imagine Mr. TREADWAY. Yes; I did imagine. Mr. O'CONNOR. That when the committee came back they were voting the President. Mr. TREADWAY. We had a perfect right to imagine. Mr. O'CONNOR. The gentleman has a right to imagine it. but I do not believe it could be substantiated. Mr. TREADWAY. I did not try to substantiate it. I was not in the coriference. Mr. O'CONNOR. And no one in the conference could substantiate it. Mr. TREADWAY. The gentleman is seeing red from some source. I did not intimate any such thing. Mr. DOUGHTON of North Carolina. ¥mi the gentleman yield? Mr. TREADWAY. Certainly, to my distinguished chair- man. Mr. DOUGHTON of North Carolina. I clearly misunder- stood my colleague and friend, if there was not at least a veiled intimation, that the White House, in a conference with certain members of the majority of the committee, had inti- mated what tax should be imposed. Was that what my friend Intended me to understand? Mr. TREADWAY. All I know about it. Mr. Chairman, la what I think would be regarded in court u circumstantial evidence. We had been sitting there for some little time, as you know, day in and day out, and when it came down to the point of what might or might not be a good rate to write into the bill, the press, one morning, announced that there had been a few members of the Ways and Means Committee at the White House the night before. I am not a lawjrer, but nevertheless I am under the impression that this might be regarded as possibly circumstantial evidence that some intimation was made as to what would be a satisfactory rate. ' ^ But let me say that there wsis distinct evidence given by Mr. Choate that $2.60, as recommended by the interde- partmental committee, was probably about 20 percent too high. So the representative of the administration before the Ways and Means Committee in open hearing practically said that $2 was a good rate. Mr. DOUGHTON of North Carolina. TO whom does the gentleman refer as the representative of the administration? Mr. TREADWAY. The representative of the administra- tion was Joseph H. Choate. Mr. DOUGHTON of North Carolina. If the genUeman will permit a further suggestion, I desire to state that, so far as I know, the President himself — and I think I know what I am talking about Mr. TREADWAY. I know the gentleman does. Mr. DOUGHTON of North Carolina. The President has neither approved or disapproved of the recommendations of the interdepartmental committee. The President made no intimation to me or, as far as I know, to any member of the Ways and Means Committee as to what tax was desired. Mr. TREADWAY. That is perfectly satisfactory. Now, Mr. Chairman, to return to the history of the situation. The minority members of the Ways and Means Committee felt that we had not had submitted to us sufficient evidence, either from experts or officials of the Government, on which to base a fair opinion as to what this tax should be. Thert- fore. the nine members of the minority of the Ways and Means Committee informed the majority of the committee that we felt that the responsibility was upon them and we voted present twice and were not recorded either for or against any rate going into the bill on distilled spirits. That is the attitude the minority members took, and I think it represents the feeling of the minority Members of the House. The feeling is that the majority having the authority should assume the responsibility. We do not know whether the rate is the proper one or not. Mr. O'CONNOR. Will the gentleman yield? Mr. TREADWAY. Yes. Mr. O'CONNOR. Does not the gentleman think that the minority having been duly elected to this body has some responsibility to procure enough revenue to balance the Budget? Mr. TREADWAY. Balance the Budget! It Is too late to go into that now. With an excess of expenditiu'e of 7, 8, or 10 billion dollars, which we heard this morning over the President's signature, let us not talk about balancing the Budget from this tax or in any other way. We will talk about that a little later. Mr. O'CONNOR. The minority is not concerned in the Budget? Mr. TREADWAY. I do not want to begin talking about the Budget at this late hour today. It is too serious a subject. /-./-\xTnr>i?c«cTrvM AT T irmpn TTnTTSFl January 4 IQOA r'AXTnT^Trc'CJTnxT AT Tfi^nmyn TTr^TToin •««M» Tariff Act for the purpose of encouraging the economic ds- mittee, Mr. Samuel B. Hill, who has been tireless in his 132 CONGRESSIONAL lECORD— HOUSE Mr. SNELL. As one member of the minority, I want to say that the figures have got so high that we cannot possibly comprehend them. With a proposition to spend $10,000.- 000.000. it seems to me it requires considerable nerve to get up and talk about balancing the Budget. Mr. O'CONNOR. The gentleman does not want to balance the Budget. ^r. SNELL, Which budget is the gentleman talking about? Mr. TREADWAY. We will talk about balancing the Budget later. Mr. McGUOIN. Mr. Chairman, will the gentleman yield? Mr. TREADWAY. Yes. Mr. McGUGIN. We all appreciate how difficult it is to ever be able to pin the present President down to a definite statement, and we have to depend to a great extent upon circumstantial statements. In support of what the gentle- man from Massachusetts [Mr. Treadway] has said, let me read from the President's own message read to this House today in the Budget, over his own signature: HoXvever, If as proposed by the Committee on Ways and Means. the tax on distilled spirits Is Increased from $1.10 to $2 a gallon. and the rates of taxation on wines are also Increased, the esti- mated revenue will be Increased by approximately $50,000,000. Mr. SNELL. And what would that do? Mr. McGUGIN. Of course the President does not state that that is the amount he wants, but it stands to reason that he is most assuredly satisfied with it or in his own mes- sage he would be taking some exception to it, and his Budget message is based upon the estimate that that tax on liquor will be $2 a gallon, and with that statemsnt cer- tainly the country has a right to accept the conclusion that the $2 tax on liquor is Mr. Roosevelt's own tax, of his own choice. Mr. TREADWAY. Mr. Chairman, how much time have I remaining? The CHAIRMAN. Mr. TREADWAY. time. The CHAIRMAN. The gentleman from Massachusetts yields back the remainder of his time and the gentleman from North Carolina has 2 minutes remaining. Mr. DOUGHTON of North Carolina. Mr. Chairman, so far as I know. I think there is no one on this side who wants to address the Committee. Mr. BLANTON. Mr. Chairman. I want those 2 minutes. Mr. DOUGHTON of North Carolina. Mr. Chairman, I yield 2 minutes to the gentleman from Texas. Mr. BLANTON. Mr. Chairman. I do not like to spend my time wastefully listening over the radio to a speech of har- mony of our good friend Bert Snell, the great minority leader of this House. sa3ring he is going along harmoniously with the President and the rest of the country Mr. SNELL. Mr. Chairman, will the gentleman yield right there? Mr. BLANTON. To get us out of this bog, and then see him now try to overwhelm our good friend from New York [Mr. O'Connor], who is trying to hold his own on this bill, with all of these stupendous figiu-es that he imagines. Mr. SNELL. Mr. Chairman, will the gentleman yield? Mr. BLANTON. Yes. Mr. SNELL. When the gentleman quotes me, I wish he would quote me correctly. I said I was going along with the President when his recommendations we believe were soimd and for the best interests of the country. I never said that I was going along with him on everything. Mr. BLANTON. Is the gentleman going along with him in his message he gave the other day? Mr. SNELL. With some parts of it I am, and to some parts I am opposed. Mr. BLANTON. And which parts are you not with him on? Mr. SNELL. Oh. on a whole lot of them. Mr. MILLARD. Mr. Chairman. I make the point of order that the gentleman from Texas Is not talking to the bilL Forty minutes. I yield back the remainder of that January 4 The CHAIRMAN. The gentleman from Texas must con- ^ne himself to the bill. Mr. BLANTON. This talk is on raising $50,000,000 in tkxes to help balance the Budget of the country. I presume t le gentleman's Republican Party on that side is interested i 1 the Government and is interested in the stability of the (Jovemment's credit and in wanting to see the Budget l^alanced. Mr. MILLARD. Oh, quite as much as is the gentleman. Mr. BLANTON. All this bunk, all this folderol. all this political balderdash put across the aisle here the people are Jetting tired of. [Applause.] The CHAIRMAN. The time of the gentleman from Texas l^as expired. Mr. DOUGHTON of North Carolina. Mr. Chairman. I 4all for the reading of the bill. The Clerk read the first paragraph of the bill. Mr. DOUGHTON of North Carolina. Mr. Chairman, I ^ove that the Committee do now rise. The motion was agreed to. Accordingly the Committee rose; and the Speaker having iesumed the chair, Mr. Bankhead, Chairman of the Com- mittee of the Whole House on the state of the Union, re- )orted that that Committee had had under consideration he bill, H. R. 6131, to raiie revenue by taxing certain in- oxicating liquors, and for 'other purposes, and had come to 10 resolution thereon. ADJOURNMENT Mr. DOUGHTON of North Carolina. Mr. Speaker. I move hat the House do now adjourn. The motion was agreed to; and accordingly ^at 5 o'clock iind 8 minutes p.m.). the House adjourned unUl tomorrow, i^iday, January 5, 1934, at 12 o'clock noon. EXECUTIVE COMMUNICATIONS, ETC. Under clause 2 of rule XXIV, executive communications vere taken from the Speaker's table and referred as follows: 245. A letter from the chairman of the United States 3oard of Mediation, transmitting copy of the seventh annual eport of the Board of Mediation to Congress; to the Cora- nittee on Interstate and Foreign Commerce. 246. A letter from the president of the Columbia Institu- ion for the Deaf, Washington, D.C.. transmitting report to IJongress of the Columbia Institution for the Deaf for the iscal year ended June 30, 1933; to the Committee on Ex- tmditures in the Executive Departments. 247. A letter from the president and chairman of the oard of the Gorgas Memorial Institute of Tropical and Preventive Medicine. Inc.. transmitting the annual report to [Congress from the Gorgas Memorial Institute of Tropical and Preventive Medicine. Inc., covering the activities of the Gorgas Memorial Laboratory, in Panama, together with statement of receipts and disbursements for the period November 1. 1932. to October 31, 1933; to the Committee on Foreign Affairs, and ordered to be printed. 248. A letter from the Secretary of the Treasury, transmit- ting the annual report of the Secretary of the Treasury on the state of the finances for the fiscal year ended June 30, 1933; to the Committee on Ways and Means, and ordered to be printed. 249. A letter from the Acting Secretary of the Treasury, transmitting, in compliance with the requirements of section 15 of the act of July 31, 1894 (U.S.C, title 5, sec. 264). a combined statement of the receipts and expenditures, bal- ances, etc., of the Government during the fiscal year ended June 30. 1933; to the Committee on Expenditures in the Executive Departments, and ordered to be printed. 250. A letter from the national legislative chairman of the Disabled American Veterans of the World War, transmitting the minutes of the Thirteenth National Convention of the Disabled American Veterans held at Cincinnati. Ohio, June 25 to July 1, 1933, inclusive, to be published under authority of Public Resolution 126 of the Seventy-first Congress; to the Committee on World War Veterans' Legislation, and ordered to be printed. \ I 1934 CONGRESSIONAL RECORD— HOUSE 133 251. A letter from the vice chairman of the national legis- lative committee of the American Legion, transmitting here- with the proceedings of the Fifteenth Annual National Con- vention of the American Legion, held at Chicago, 111., October 2 to 5, 1933, as provided in Public Resolution 126, Seventy- first Congress, approved March 2, 1931. for printing as a House document; to the Committee on World War Veterans' Legislation, and ordered to be printed. 252. A letter from the Director of the Bureau of the Budget, transmitting herewith a letter from the Budget officer. Department of Justice, submitting report of vessels and vehicles seized under the National Prohibition Act, dur- ing the fiscal year 1933; to the Committee on Expenditures in the Executive Depaitments. 253. A letter from the Administrator of Veterans* Affairs, transmitting pursuant to the provisions of section 6 (c) of the act of July 3, 1930 (Public, No. 536, 71st Cong.), the third annual report of activities of the Veterans' Admin- istration for the fiscal year ended June 30. 1933; to the Committee on World War Veterans* Legislation, and ordered to be printed. 254. A letter from the Secretary of the Interior, trans- mitting recommendations of the Commlsisoner of Indian Affairs pursuant to the act of Jul? 1, 1932 (47 Stat. -364) ; to the Committee on Indian Affairs and ordered to be printed. 255. A letter from the Postmaster General, transmitting in compliance with the provisions of the act of July 28, 1916. a report of all cases where special contracts are made with railroad companies for the transportation of the mails; to the Committee on the Post Office and Post Roads. CHANGE OP REFERENCE Under clause 2 of rule XXn, the Committee on Pensions was discharged from the consideration of the bill (HM. 1358) granting an increase of pension to Clarence W. Failor, and the same was referred to the Committee on Invalid Pensions. PUBLIC BILLS AND RESOLUTIONS Under clause 3 of rule XXn, public bills and resolutions were introduced and severally referred as follows: By Mr. BYRNS: A bill (HJl. 6355) to amend tiUe H, sec- tion 203 (a) (2), chapter 67, public acts of Seventy-third Congress; to the Committee on Ways and Means. By Ml-. FREY: A bill (KM. 6356) to extend the time for completing the construction of a bridge across the Delaware River near Trenton, N.J.; to the Committee on Interstate and f\}reign Commerce. By Mr. KERR: A bill (H.R. 6357) to prohibit the ex- portation of tobacco seed and plants, except for experi- mental purposes; to the Committee on Agriculture. By Mr. HOPE: A bill (H.R. 6358) to make barley and grain sorghums basic agricultural commodities for the pur- poses of the Agricultural Adjustment Act; to the Committee on Agriculture. By Mrs. NORTON: A bill (.HH. 6359) authorizing the sale of certain property no longer required for public purposes in the District of Columbia; to the Committee on the Dis- trict of Columbia. By Mr. WARREN: A biU (H.R. 6360) to provide warrant officers of the Coast Guard parity of promotion with warrant officers of the Navy; to the Committee on Interstate and Foreign Commerce. By Mr. MOREHEAD: A biU (HH. 6361) to provide for the grading and paving of the part of Eighth Street, city of Plattsmouth. Nebr., and of a part of county Highway No. 307 of Cass County. Nebr.; to the Committee on Roads. By Mr. GLOVER: A biU (H.R. 6362) to aid commerce; to the Committee on Rivers and Harbors. By Mr. McFARLANE: A bill (HJl. 6363) to provide pun- ishment for certain offenses committed against (member banks of the Federal Reserve System) bfmks organized under laws of the United States, and banks located In the District of Coliimbia, the Canal Zone, and territories and posses- sions of the United States, and for other purposes; to the Committee on the Judiciary. By Mr. ROGERS of Oklahoma: A bill (HA. 6364) amend- ing certain provisions of Pubhc Law No. 2, and Public Law No. 78, Seventy-third Congress, to provide compensation for disabled veterans, and for other piuposes; to the Committee on World War Veterans' Legislation. By Mr. JENKINS: A bill (HJl. 6365) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78, Seventy-third Congress, entitled "An act malting appropriations for the executive offices and sundry inde- pendent executive bureaus, boards, commissions, and offices for the fiscal year ending June 30, 1934. and for other pur- poses "; to the Committee on World War Veterans' Legis- lation. By Mr. MOREHEAD: A bill (HJl. 6366) making appro- priation to restore water of high mineral content on land owned and controlled by the Federal Government; to the Ccmimittee on Claims. By Mr. GLOVER: A bill (HJl. 6367) to promote educa- tion; to the Committee on Banking and Currency. By Mr. MARLAND: A bill (HJ%. 6368) to provide for the control of flood waters of the Arkansas River and its tribu- taries; to provide for the irrigation, agricultural develop- ment, and terracing of lands in the Arkansas River water- shed; to provide for the development of electrical power along the streams in such watershed; to provide for the reforestation of lands suitable therefor in such watershed; and to provide for the economic and social well-being of people living in the Arkansas River watershed, and for other purposes; to the Committee on Flood Control. By Mr. BLOOM* A biU (HJl. 6369) authcoizing the pay- ment of an indenmity to the Spanish Government on ac- count of the death of Juan Neira, a Spanish subject, killed at Savannah, Ga., by a United States truck; to the Commit- tee on Foreign Affairs. By Mr. BURKE of Nebraska: A bill (HJl. 6370) to extend time for completion of construction of bridge across Biissouri River at or near South Omaha. Nebr.; to the Committee on Interstate and Foreign Commerce. By Mr. MALONEY of Connecticut: A bill (HH. 6371) tj provide for guaranteeing the principal of bonds issued by the Home Owners' Loan Corporation; to the Committee on Banking and Currency. By Mr. HARLAN: A bill (HH. 6372) to amend the Code of Laws for the District of Colimibia, approved March 3. 1901, as amended (D.C. Code, title 5, ch. 3). relating to building and loan associations; to the Committee on the District of Columbia. By Mr. GLOVER: A bill (HJl. 6373) to relieve the un- employed and aid agriculture; to the Committee on Agri- culture. By M. SWANK: A biU (HJl. 6374) to amend Public Law No. 2, Seventy-thtrd Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independ- ent executive bureaus, boards, commissions, and offices, for the fiscal year ending June 30, 1934, and for other pur- poses"; to the Committee on World War Veteraias' Legis- lation. By Mr. MEAD: A bill (HJl. 6375) to authorize the pay- ment of annuities withheld from employees retired from ac- tive service during the month of July 1932, under the pro- visions of the economy law; to the Committee on the Civil Service. By Mr. BLACK: A bill (HJl. 6376) to prevent the ounu- facture, sale, or transportation of adulterated or mlsbranded or poisonous or deleterioift foods, drugs, medicines, cosmetics, and liQUors. and for regulating trtkfflc therein, and for other purposes; to the Committee on Interstate and Foreign Commerce. CONGRESSIONAL RECORD— HOUSE 134 By Mr BLOOM: A bill ~ HOUSE U5 Also, a bill (HJl. 6422) granting an Increase of pension to Nellie Marshall; to the Committee on Invalid Pensions. Also, a bill (HJl. 6423) granting an Increase of pension to Isabella B. McCandless; to the Committee on Invalid Pensions. Also, a bill (H.R. 6424) granting an increase of pension to Safrona P. Wolfe: to the Committee on Invalid Pensions. Also, a bill (HJl. 6425) granting a pension to Abbie Stuck; to the Committee on Invalid Pensions. Also, a bill (HJl. 6426) granting a pension to Frances DuPrane; to the Committee on Invalid Pensions. Also, a bill (H.R. 6427) granting a pension to Emma B. Parker; to the Committee on Pensions. Also, a bill (HJR. 6428) granting a pension to Charles J. Fuhrer; to thie Committee on Pensions. Also, a bill (HJl. 6429) granting a pension to Oscar Un- ville; to the Committee on Pensions. Also, a bill (HJl. 6430) for the relief of the estate of George Evert Wever; to the Committee on Ways and Means. Also, a bill (H.R. 6431) for the relief of Emma Berlet Taylor; to the Committee on Claims. Also, a bill (HJl. 6432) for the relief of Mary E. McGerr; to the Committee on Claims. Also, a bill (HJR. 6433) for the relief of Nettie B. Rush; to the Committee on Claims. Also, a bill (HJi. 6434) for the relief of the heirs of Wells C. McCool; to the Committee on War Claims. By Mr. REECE: A bill (H.R. 6435) for the relief of Harry Gordon; to the Committee on Military Affairs. Also, a bill (HJl, 6436) for the relief of Lawrence Hyder; to the Committee on Naval Affairs. Also, a bill (KM. 6437) for the relief of Ruby L. Ford; to the Committee on Military Affairs. Also, a bill (HJl. 6438) for the reUef of George W. Rich- ardson; to the Committee on Military Affairs. Also, a bill (HH. 6439) for the relief of Earl F. Taylor; to the Committee on Military Affairs. Also, a bill (HJl. 6440) for the relief of Samuel G. White; to the Committee on Military Affairs. Also, a bill (HJl. 6441) for the relief of David C. Lewis; to the Committee on Mihtary Affairs. By Mr. RIC^HARDSON: A bill (HJl. 6442) granting a pen- sion to Annie B. Pott; to the Committee on Invalid Pensions. Also, a bill (HJl. 6443) granting a pension to Elia Frees; to the Committee on Pensions. By Mr. SMITH of West Virginia: A biU (H.R. 6444) for the relief of Richard H. Bowman; to the Committee on Mili- tary Affairs, Also, a bill (HJl. 6445) granting a pension to Sarah M. Williams; to the Committee on InvaUd Pensions. By Mr. SPENCE: A bill (HJl. 6446) for the relief of Charles M. Marshall; to the Committee on Military Affairs. By Mr. STRONG of Pennsylvania: A bill (HJl. 6447) granting an Increase of pension to Mary McCoy; to the Committee on Invalid Pensions. By Mr. TINKHAM: A biU (H.R. 6448) for the relief of James C. McCormlck; to the Committee on Claims. By Mr. TURNER: A bill (HJl. 6449) granting » pension to Jennie Wlfffall Counce; to the Committee on Pensions. By Mr. VINSON of Kentucky: A bill (H.R. 6450) granUng a pension to Dankl W. Perkins; to the Committee on Pensions. By Mr. WOLPINDBN: A bill (HJl. M51) for the relief of Edward P. O'Neal; to the Committee on MUitary Affairs. Also, a bill (HH. 9462) for the relief of the VaUey Fbrge MUitary Academy. Inc.; to the Committee on MlliUry Affairs. By Mr. WOODRUFF: A bill (HJl. 6453) for the relief of Grant Morrison; to the Committee on Claims. Also, a bill (HJl. 6454) for the relief of Mrs. W. E, Bouchey; to the Committee on Claims. Also, a bill (HJl. 6466) granting a pension to Minnie Harrington; to the Committee on Invalid Pensions^ Also, a biU (HJl. 6456) granting a penstoD to Esther Oitchell; to the Committee on Invalid Pensions. Also, a bill (HJl. 6457) granting a pension to Helen J. Selley; to the Committee on Pensions. Also, a blU (HJl. 6458) grantlz^ a pension to Asa Ennes; to the Committee on Pensions. Also, a biU (H.R. 6459) granting a pension to William Gage; to the Committee on Invalid Pensions. PETITIONS. ETC. Under clause 1 of rule XXll, petitions and papers were laid on the Clerk's desk and referred as follows: 1460. By Mr. CULLEN: Petition of National Association of Letter Carriers at a convention held in Atlantic City, September 4-9, 1933. went on record favoring legislative rehef for substitute letter carriers, and to that end urged the adoption of a bill introduced by Hon. James M. Mead, H.R. 4017; to the Committee on Expenditures in the Execu- tive Departments. 1461. Also, petition of Pittsburgh Central Labor Union, urging the early repeal of title 2 of the Economy Act, which authorizes the salary reduction for governmental employes; to the Committee on Appropriations. 1462. Also, petition of the New York City Federation of Women's Clubs, endorsing the general principle and purpose of Senate bill 1944, introduced by Senator Copeland. which will increase the scope of the Federal Food and Drugs Act; to the committee on Agriculture. 1463. Also, petition of CHuurles D. McCoy Camp, No. 28, United Spanish War Veterans, Vtncennes, Ind.. urging the repeal of the Economy Act and the relnstatonent of all vet- erans who at the time of the passage of the Economy Act were on the pension roll; also the restoration of all money due than by way of any reductions In their pensions since the passage of the act; to the C^ommittee on Appropriations. 1464. Also, petition of Sergeant Harry Wm. Steneck Post, No. 601. Veterans of Foreign Wars of the United States. Brooklyn. N.Y., urging the repeal of the Economy Act; to the Committee on Appropriations. 1465. By Mi. GLOVER: Petition of the citizens of Gar- land Coimty. Ark.; to the Committee on Appropriations. 1466. By Mr. KVALE: Memorial of the Legislature of the State of Minnesota, memorializing Congress to enact legis- lation to protect American industry and the employees thereof against cheap foreign labor and products; to the Committee on Ways and Means. 1467. By Mr. RUDD: Petition of CHiamber of Commerce of the Borough of Queens, City of New York, opposing the so-called " Tugwell bill ", in its present form; to the Com- mittee on Agriculture. 1468. By Mr. SPENCE: Petition of E:entnck7 Progressive Association for the Blind; to the Committee on Education. 1469. By Mr. TARVER: Petition of Local Union No. 1831, United Textile Workers of America, Rome, Ga., protesting against reduction of wages of southern workers; to the Com- mittee on Interstate and Foreign Cixnmerce. 1470. By Mr. 8TRONO of PeiuisrlTanla: Petition of Tax Justice League of Tndlana County, Pa., reouesting the Con- gress to define by regular eDActment: (1) Tbe contemtHated changes to be made tn the gold dollar if the gold dollar is to be restored to the people; (3) the meaning of '^ commodity dollar"; and (I) the meg ntng of " maniged doUar"; to the Committee on Cctatm^, Weights, and Measoivs. 1471. By the SPEAKER: PeUtlon oC tbe ettj of Chicago, HI., regarding a $40,0M.M0 loMi to the city of Chlamo by the ReeonstnietloB Ftnaaee CorporaUon; to the Committee on Banking and Currency. 1473. Alec, petition of the ettf «< Dmthon, Mlefa^ ngard- Ing woild peaee; to the Committee on Foreign AfTalr*. 1473. Also, petition of the Mew Deal Democratic Orgsolza- tion of Shreveport, La„ regarding the oongreesloaal election in tbe Sixth District of Iiouislana; to the Comnittee on Electtens Mo. S.. 136 CONGRESSIONAL : RECORD— HOUSE HOUSE OF REPRESENTATIVES Friday, January 5, 1934 The House met at 12 o'clock noon. The Chaplain. Rev. James Shera Montgomery, DX).. offered the following prayer: Apart from the busied, hurried world, our Father, in this quiet moment we would acknowledge the sanctity of Thy sovereign will. Be merciful unto xis, O God: be merciful unto us. Thou dost summon us to bring our lives in unison with the divine purpose. We wait; hear us and turn our faces toward the heights. Continue to preserve us by Thy providence and make the onward path plain. Hold us as a nation and allow nothing to sound so furiously as to drown the majestic Voice Divine. Let love, contentment, and jus- tice overbrood our homeland, and may all our people serve Thee with great humility and gratitude. Amen. The Journal of the proceedings of yesterday was read^and approved. CONTESTED ELECTION — JAMES M'ANDREWS V. FRED A, BRITTEN The SPEAKER laid before the House the following com- jiunication from the Clerk of the House, which was read, and. together with the accompanying papers, referred to Committee on Elections No. 1 and ordered printed: j HOUSB OF RZPKESKNTATIVXS. I Clerk's Omcx, Washington. D.C., January 3, 1934. The Spsakb. House of Representatives. Washington. D.C. Sol: I have the honor to lay before the Houae of Repreaenta- tlves the contest for a seat in the Hoiiae of Representatives for the Seventy-third Congress of the United States for the Ninth District of the State of Ullnola, James Mc Andrews ▼. Fred A. Britten, notice of which has been filed In the offlce of the Clerk of the Ho vise: and also transmit herewith original testimony, papers, and documents relating thereto. In compliance with the act approved March 2. 1387. entitled "An act relating to contested-election cases ". and such portions of the testimony as the parties In Interest agreed upon or as seemed pn^>er to the Clerk, after giving the requisite notices, have been printed and Indexed, together with the notices of contest, and the answers thereto and original papers and exhibits have been sealed up aiul are ready to be laid befCMre the Committee on Elec- tions. Two copies of the printed testimony in the aforesaid case have been mailed to the contestant and the same number to the con- testee. which, together with an abstract thereof, and copies of the briefs of the parties. wlU be laid before the Committee on Elections to which the case shall be referred. Yours respectfully. South Tkiiisls. Clerk of the House of Representatives. COHTMIKP KLtCnOm — WILLIAM C. FOX V. WILLIAM L. HlOOIIfS The SPEAKER laid before tbe Houec the foUowlng fur- ther communicstkm from tbe Clerk of the Hooee, which wm read, sod, together with the Mcomtwtijniif i»pert< referred to Commtttee oo Electkme No. 3 and ordered prtnted. HtfVM Or IMrfMMM»f7STI fM/ W(urHin0t9n> OjO., January », ifU, Mtht$4 of Mopr0»0ni4Hif0i, WBSMnftaitt 0/0, •m; I toete tue \mm fo ler tietore «*ie Noum ef IMffeiefit*' MfMi MAteH fer e Mel m t*M ffottw of ReprMfnletlvM im (toe •ei^efttr'tnifd OencreM of tHe VniMd tietee for tlie f«ewls4iu of ttut brlnftng of e amUH growing out of the election in 1093, in the Mecimd Coti' SreeeUmal Dtetrl^t of the Vtau of Pennsylvania, of Khonahan v. eek, by the flUng of notice of contest in reply thereto. The time prescribed by law for the taking of testimony having long since expired and no testimony having been transmitted to the Clerk of tbe House, it would appear that this case has been abated. Herewith are copies of the notice of contest and the reply thereto which are submitted for reference to the Committee on Elections, together with this communication. Very respectfully. South Trimbls, Clerk of the House of Representatives. CONTESTED ELECTION — LACUARDIA V. LANZETTA The SPEAKER laid before the House the following further communication from the Clerk of the House, which was read, and. together with the accompanjring papers, referred to the Committee on Elections No. 1, and ordered printed: 1934 CONGRESSIONAL RECORD—HOUSE 137 BOTTSE OP Rkphisentatives, Clixk's CfrrtCK, Washington. D.C.. January 2, 1934. Hon. HxK«T T. Raikkt, Speaker of the House of Representatives, Washington. D.C. Sni: This office has unofficial knowledge of the bringing of a contest growing out of the election In 1932, In the Twentieth Congressional District of the State of New York, of LaGuardia v. Lanzetta, by the filing of notice of contest in reply thereto. The time prescribed by law for the taking of testimony having long since expired, and no testimony having been transmitted to the Clerk of the House, It would appear that this case has been abated. Herewith Is a copy of the reply to the notice of contest, which Is submitted for reference to the Committee on EUectlons, together with this conimunication. Very respectfully, SOCTTH TBIMBLE. Clerk of the House of Representatives. CONTESTED ELECTION CASEY V. TURPIN The SPEAKER laid before the House the following fur- ther communication from the Clerk of the House, which was read and, together with the accompanying papers, re- ferred to Committee on Elections No. 3, and ordered printed: HonsK OF REPHESE?rrATrvKs. Clerks Ofkcb, Washington, D.C. January 2. 1934. Hon. Hkket T. Rautet, Speaker of the House of Representatives, Washington, D.C. Sib: This office has unofficial knowledge of the •:>ringing of a contest growing out of the election in 1932, in the Twelfth Congressional District of the State of Pennsylvania, of Casey v. Turpin, by the filing of notice of contest in reply thereto. The time prescribed by law for the taking of testimony having long since expired and no testimony having been transmitted to the Clerk of the House, It would appear that this case has been abated. Herewith are copies of the notice of contest ari the reply thereto, which are submitted for reference to the C-mmittee on Klections. together with this conuniinicatioo.. Very respectfully, Sooth Teimblx, Clerk of the House of Representatives. FERMISSION TO COMiaTTEE ON THE DISTRICT OF COLITMBIA TO SIT DXnUNG SESSIONS OF THE HOUSE Mr. BLACK. Mr. Speaker, on behalf of the Committee of the District of Columbia, I ask unanimous consent that that committee be permitted to hold joint hearings with the Senate Committee on the District of Columbia on the Dis- trict of Columbia Uquor bill during the sessions of the Hotise today and tomorrow, if there should be a session tomorrow. The SPEAKER, Is there objection to the request of the ffentleman from New York [Mr. Black]? There was no objection. maaancm to avvrkss thk novsc Mr, BLACK, Mr. Speaker, I ask unanimous consent that I may be pennltted, «t the conclusion of the bill now before ttie tio\m, U» AddrMf ttie Hom» tot 4» minutes. The nvtAKtn. U tliere objection to the re^tiMt of tiM f#ntlefrMiti ffom Hew Yorti mr. niAcnn Mr, uruntt, tUnmrnm the niimt to etoieiw to diu it on y««Urd«y, ind I requested him to withhold his statement until the conclusion of the bill now before the House, when I hoped the House would be entirely willing to bear his statement. He is anxious to make that statement today. We do not know just when the pending biU will be finished. We had hoped that it would be finished today so that we oould take a recess over until Monday. Inasmuch as there will be no appropriation bill on Monday and although I do not know just what will be on the District Calendar, I see no reason why the gentleman and other gentlemen who want to make speeches on Monday shall not have that privilege. I should appreciate it if the gentleman would withhold his request until the conclusion of the pending bill, so that we can see just whether we will adjourn over imtil Monday, or whether we will meet tomorrow. Mr. BLACK. Would the gentleman sosgest that I ask now for special time on Monday? Upon reflection, however, I realize that is against the niles. Mr. BYRNS. I would rather the gentleman withhold his request until we get through with this bill. I do not antici- pate any difficulty, bub the gentleman understands the sit- uation. He is going to be here throughout the consideration of this bill and can make his request later. Mr. BLACK. Does the gentleman know how long the Delegate from the Philippine Islands will speak to us on his important message? Mr. BYRNS. He asked for 15 minutes. He is anxloas to make the address today. Mr. BLACK. Would it be satisfactory if I modify my re- quest to be permitted to address the House at the conclu- sion of the address of the Delegate from the Philippine Islands? Mr. BYRNS. I would appreciate it very much if the gen- tleman would withhold his request until we conclude this bill. Mr. BLACK. Mr. Speaker, I withdraw my request COMPENSATION OF FEDERAL EMPLOYEES Mr. HOEPPEL. Mr. Speaker. I ask unanimous consent to address the House for 1 minute. The SPEAB^ER. Is there objecUon to the request of the gentleman from California? There was no objection. Mr. HOEPPEL. Mr. Speaker, I have on the Clerk's desk a petition to discharge the committee from further con- sideration of my bill H.R. 5655, which seeks to restore to Federal employees the 15-percent pay reduction. I hope every Member of the House who is in favor of restoring to Federal emplojrees their just pay will sign this petition. NATIONAL OLD -AGE PENSIONS Mr. BROWN of Kentucky. Mr. Speaker. I ask unanimous consent to extend my remarks in the Record by incorporat- ing therein a speech delivered by the gentleman from Wis- consin [Mr. OTilALLEY] over the radio last Sunday evening. The SPEAKER. Is there objection to the request of the gentleman from Kentucky? There was no objection. Mr. BROWN of Kentucky. Mr. Speaker, under the leave to extend my remarks In the Rxcoto, I include the following speech delivered by the gentleman from Wisconsin I Mr. OliCALLKT] over tlie radio la«t Sunday evening: PerhMM no rabjeet eould b« eboMn that tnlgbt ao eMtlv be wrappMi in Mntlm«nt and dMoratMl with •ympatby inwirlnc nding for tb« Mcurlty of thOM mitold thouMUMto of our f«lkm citiz«n«now traveling in the twiligM on the roMl ef )tf« .J!2.* !2^..*!l!L!?*^* of inr ttme Ml Mm tMio thto eftemoon •utee Cengree* who favor the phmmtfU of eM-ege pmnHtrttTl gjjjjij^ The 4««el«l4iNi lo wMeli f fS7 SSTlSSMntimf m •uhmlMtoA to the rHuIsttom td govenumrnt i« that he nhaUlM guarsntMd bf government in mwn the oppertunltr to lire out fc^mjriiul Bpm of Ufe to peeee, i»e!^. and r^e^maM* For nearly u far back m bUtory rwsords. bovovar, ffor«ram«nt« have InterMUd themMelv— only la legislation ragardine man's re- lauonahlp to hi« Individual feUow man. Wa may b« thankful indeed, that In spite of th« woa and aorrow of tha depreaskm tha broken hearts and broken bomaa of tba paat 4 years, the period we are rapidly leaving, has brought a new conc^tton of ^ern- ment. a conception that also recognizes the dire need of legislat- ing man's relatiousmp to an eoonomic system over which the individual has lost control. This new conception of government which reoognlaes the need for a national elimination of child labor, a national minimum wage law and regulation of working conditions, a national sys- tem of providing work for the unemployed Instead of charity and a national plan for saving the homes and farms of the tollers' and producers must logically also recognlae the need for a na- tional plan of old-age pensions. )i 138 CONGRESSIONAL In spite of the pronouncements of famous economists of the yea?, past, whose £)oks are the subject of study by »" th« «;^^ den^ of economics. I cannot believe the theory ^^^^J.^ P^^^^^'^J will support consumption " will hold water, either today or In the f«Mir# We have reached a point, my friends, where men and women i^st^ honorably retired from the rinks of competitive S.?Sr at a ?^asJnaCre age In order to make room for the younger i^L^i with families to rear and careers to carve out of our Gnomic system At the same time, these older citizens must ^t bTleft to starve, but must be guaranteed an incooie tbat will JSp them in the ranks of the consumers of goods witnout making them the pitiful objects of charity. ♦!.,„„ Charity in any form has always seemed an abhorrent thlng_ and It must be lo especially to the useful citizen who^^^f the vagaries of life, finds his old age only a series of dishearten-4 ing days of dependence upon friends, relatives, or Institutions How much better, more logical, and humane, then, to provide a system on a national scale of retiring our citizens on an old-ag« compensation basis? We retire our postal employees, veteran soN dlers and sailors, policemen, firemen, teachers, and others. Cer talnlY to my mind, the rank and file of our citizens deserve th< equal advantages and security in old age which fhese specia BToupa of citizens enjoy through organization and their wllllngnesji to contribute a small share of their earnings to a pension. Many persons will say that It Is the duty of everyone to savi for hU old age— to lay aside some part of his earnings In stock i and bonds, or In banks, so that he may be assured of enougl, to live on m his declining years. Others will say that there am institutions for the aged and Infirm, supported by the taxpayers where old people can be taken care of when they have been cast o" like an old and worn machine by our economic system. You have only to look around you to see a few of the million t of our citizens who. unfam.illar with the ways of money and finance, saved for years only to find themselves destitute with tht winter of lifetime approaching. , ,4. ♦», . Taking the argument of Institutions. I have always felt tha, there never was a more glaring example of man's inhumanit r to man than a poorhouse or an old people's home. No matter how well run or how kindly and conscientious the directors an institution, who is there among us who would not sooner receive the money In cash that It takes to support one person in an Institution and use It to maintain a httle home of our own. no matter how humble? Think of a man and wife, together for 4o or 50 years, now separated under the same roof, seeing eac** other only at regulated Intervals, after those many years tha have made them almost one person in their dependency upon one another! How much more happiness would be theirs with » small Income on which to live out their little span of life together From the taxpayers' standpoint the institution argument 1: place of an adequate old-age pension plan Is a poor one. Flgur^ gathered by the National Old Age Pension Association from average institutions show that the cost of maintaining one son in a poorhouse Is <508 per year Add to that the fact the property of an Institution Is exempt from taxation, as we as the salaries of the employees In the Institution, and yo further Increase the taxpayers' burden for providing for our Ind: gent old people. In addition, a large part of the tax dollar ♦-* the maintenance of old jjeople in institutions goes. In reality sxipporting an army of Job holders. I know of an institution maintained by a county government where 112 employees found necessary to take care of less than 300 jseople. It doesn't take much figuring to show that the plan of paying A pension of »30 per month to persons who voluntarily retire from all competitive labor would result In a distinct saving to the taj payers over any system of Institutions ever devised. The raising of the funds out of which to pay this pension . the earnings of younger workers would seem a fair proposltloi since m most cases the small contribution of the younger wor''^' to ietire an older person would be In effect merely a small tax permanent employment, actually a " Job tax." I don't bellevp once clearly understanding the facts, that there would be r among our millions of young unemployed men who would gladly pay a few pennies out of their wages to obtain a Job brought about by the retirement of an older worker, rather than parade his poverty and unemployment In front of a coaster wagon dragged home twice a week from some unemployment relief station. Many of you. my friends, will probably reason that the proble n of old-age pensions Is one entirely up to the SUte governments Most of us who have long favored the old-age pension plan on}" thought likewise. The record, however sad it may seem, shou- that old-age pension legislation, where enacted by individual States, has been In most cases a ghastly failure. There are many reasons for this failure, but I shall only try point out a few of the most Important. First of all. to pay old-' pensions the State must obtain the revenue, which can only accomplished by taxation. Any Increase In expenditures resi InevlUbly In increased taxation. Thus the manufacturer, farm and other producers of the State must obtain higher prices for t, things they produce to cover the higher taxes. The products of State without old-age pension laws, without minimum wage ^"^ and without other laws of great social benefit can be sold ch^. than those of the more progressive and humane State. This pi. the progressive State at a disadvantage in finding a market for naturally higher-priced products. To be fair to all. then, the n: -ter of old-age pension legislation should be national. Just as t other great advances In social Justice made by our Government the past few months have been national. 78 7 pei- that yoi a;e >e results r. e a tu lav s. cheap er lacfs Its ma t- le In RECORD— HOUSE January 5 i. And. again, the SUte with an old-age pension law right next to a State without such a provision for the aged and Infirm might soon find Itself crowded with the older citizens of Its less progres- sive sister State anxious to take up residence Just before reaching the pension age In order to qualify for its benefits. Just as all the citizens of the Nation have recognized the inhumanity of per- mitting little children to toll their short childhood away In sweat- shops and f arteries in many sections of the countr>% we are ap- proaching, also, the time when all of us recognize that the aged and infirm of one State should not be denied the advantages of their fellow citizens in another State simply because they may have chosen to live and work in a particular section of this broad and wonderful country of ours. ^ ^ . i v. Those are but a few of the reasons why such a universal prob- lem as an adequate system of old-age pensions should be a matter of national legislation. Many more might be added, but my time Is limited and I must confine myself to the high points of this important step In our progress toward a better social order for the rank and file of our fellow Americans. , ,^ . . , I know I am not alone In the Congress in favoring the principle of old-age pensions. My own State was one of the pioneers, not only in realizing the need for legislation of this kind, but In the enactment of legislation providing for pensions for widows with families to support, for compensation to disabled workers, for minimum wages and maximum hours In Industry, and legislation of similar broad Christian principles. Many other nations have had systems of rethement pensions for workers In all branches of industry and trade, as well as old- a^e pensions for unclassified workers of every kind, from the farmer to the hospital worker and from the teacher to the shoe- maker The last 4 years of depression have taught us that busi- ness finance, and many other things In our social order may totter and tremble around us, but one thing remains firm and steadfast, able to stretch out a helping hand to us If we our- selves ask for It— and that Is our National Government. I think when I review in my mind the wonderful strides made by the Congress of the United States in legislation passed at the special session of last spring, of a phrase in one of the speeches of our great leader and President, franklin Roosevelt. He said: " We are about to enter upon a new period of liberalism and sane reform in the United States, and we shall require unity of purpose, if not of opinion, If we are to achieve permanent and practical results." Those words, when uttered early last year, were prophetic of the many splendid refnrm.s In the h&sic laws of our land made In the year we are just bidding farewell. They are today prophetic of more reforms in our social order in the year to come. And as one of the reforms In our laws to which I look forward, I trust that the efforts of the National Old Age Pension Association, en- listing nation-wide support for old-age pensions, will bear rich fruit and that the crowning achievement of 1934 will be the en- actment by Congress of a national old-age pension act. What the law will specify In completed form no one would presume to predict. But If It provides a reasonably adequate pension, raised by a sound and equitable method of taxation. It win spell the end of the poorhouse. provide countless new Jobs for younger workers, and result In a real saving to the taxpayers On that basis, such a law would not only have my vote, but I feel sure It would have the votes of an overwhelming majority of the Congress. When a law of this kind Is finally passed by the Congress, we will have marked a new milestone In our progress in America: " Where fear no longer walks with age. But peace and comfort takes Its place." JOHN MARSHALL Mr. BECK. Mr. Speaker, I ask unanimous consent to pro- ceed for 1 minute. The SPEAKER. Is there objection to the request of the gentleman from Pennsylvania? There was no objection. Mr. BECK. Mr. Speaker. I happen to be at the moment chairman of the committee of American citizenship of the American Bar Association. As such chairman, I have issued an appeal to the bar of the country to meet in their several communities on February 4 next to recall the fact that on that day 133 years ago John Marshall took the oath of office as Chief Justice of the United States. The appeal is printed in the current number of the Amer- ican Bar Association Journal, and I ask unanimous consent in extension of my remarks now made to include this appeal as therein printed. The SPEAKER. Is there objection to the request of the gentleman from Pennsylvania? There was no objection. The matter referred to follows: AN AFPKAI. TO THE AMEKICAN BAR BY THE CrriZENSHIP COMMITTTE ON AMEKICAN At a meeting of the committee on American citizenship of the American Bar Association, held in Washington on the 17th day of 1934 CONGRESSIONAL RECORD— HOUSE 139 November, the committee pave earnest consideration to the ever- Increasing change In the public mind aa to the present value of the Constitution. The committee did not attempt to consider the application of the Constitution to current governmental policies, and it does not desire to do so now. Opinions differ as to the constitutionality of some of the emergency legislation, and the committee has no desire, as an organ of the American Bar Association, to discuss that grave question in this appeal. We are dealing with a drift of opinion In recent years, for which no party is solely responsible. The committee believes that for the last 25 years there has been » growing disbelief In the value of our constitutional form of gov- ernment, and that the Constitution cannot long stirvlve any want of faith In Its essential Justice and wisdom. As it Is the organic expression of the Union, the committee viewed with grave concern the fact that some leaders of thought, especially in the colleges and universities, are treating the moral authority of the Constitu- tion with a feeling that borders on contempt. The conunittee strongly feels that the Constitution is not only the best expression of the political Ideals of the English-speaking race but that Its destruction would sooner or later menace the perpetuity of the Union. Recognizing the peculiar responsibility of the legal profession for the maintenance of the Constitution, the committee decided to appeal to American lawyers to exert their influence in their sev- eral communities to defend the basic principles of the Constitu- tion and to Impress upon their fellow citizens its infinite im- portance and lasting value. If the American bar abandons the ship, then the Constitution may soon disappear in the angry waves of social discontent that are now running mountain high. During the World War the most critical dec' Ion to be made by the captain of k troop transport wi\s when to give the commaud "Abandon ship. ' The cool-headed and experienced man on the bridge never ordered the troops to the fragile and tricky rafts and lifeboats because a storm had subjected the timbers of his ship to unusual stresses and strains, nor because below declcs there was a rumbling of fear aroused by the groaning and grinding of the timbers as they met the force of the storm. The stresses and strains of the desperate depression through which we are passing have inspired a similar fear, and the question is being bruited from lip to lip. Shall we abandon ship? The passenger on the ocean liner — the soldier on the transport — gives little thovight to the beams that are hidden away In the hull when the skies are clear and the ocean calm. The tensile strength of the beams is then of little concern. It is different When the skies darken and the hurricane tosses the liner from the crest of one moimtalnous wave to the trough of another. Then the passenger listens to the grinding of the beams and wonders If they are stanch and seasoned. So It Is with governments. Liberties are enjoyed and life flows serenely on imder almost any form of government in the piping days of peace or in the long and lazy calm of prosperity. It Is only when the country meets the shock of war, or is lashed by the adverse winds of economic depression and unrest, that the strength of government meets its ultimate test. It is then, and then only, that the liberties of the Individual are endangered. It Is then. In particular, that It behooves us all to stop and ask, What of this vessel that has carried us from an anemic confed- eracy to the greatest nation In the world? It ha.s weathered the storms of civil and foreign war; it has withstood the stresses of other depressions and has successfully outlived the growing pains of prosperity: but have the strains of a century and a half rotted the timbers In the hull? Or was it constructed sUnchly enough to ride out such a storm as this? Nor does the analogy end there. A liner that Is seaworthy only in fair weather — one that founders in a storm — is worse than worthless. Who would embark on a boat that could not weather a storm? So, too, a form of government that Is good enough only for fair weather is no government at all. If this Government of our forefathers, conceived in liberty and conse- 4 crated to the freedom of Its citizens, is not stanch enough to weather an economic depression, then It is no government at all. and we might as well abandon ship. The answer will come from the average man — the farmer in the fields, the laborer In the shop, the business man In the store on the corner. The courts can hold the ship of state on her course, but the passengers will determine whether the ship will be abandoned. That decision Involves much. It means much to us, the living; It means more to those who will follow. U we abandon ship, we leave our liberties behind; no longer will we decide as to the work we will do, the pursuits we will follow, the God we will worship, or the education of our young. No longer will we say what we think, nor will accusations longer be Judged by a Jury of our peers. When we abandon ship, we must take to the lifeboat of com- munism, the raft of a dictatorship, or plunge directly into the depths of anarchy. Because that decision Is of incalculable Importance to ourselves and generations yet unborn, it ought to be intelligently made. Our hope is that each citizen will know something of the timbers that make up the hull of our Government, so that it cannot be said that a stanch and seaworthy vessel was abandoned in the midst of a raging storm on the high seas without some knowledge of its ccMistruction. ^^ The genius of a free people has rested upon the proposition that This Is a Government of laws and not of men ", ancient words Immortalized by John Marshall In the first of his constitutional opinions. I In sticceedlng centuries our Uberty-larlng forbears wrung from arbitrary power other personal rights — the right to worship his I God according to the dictates of his conaclence came when sevea bishops defied the power of their king to decree what should be said from their pulpits, stood trial for their offense, and wei« acquitted by a Jury; the right to a release from prison by the writ of habeas corpus 11 a charge were not promptly made and speedily tried; the right of freedom of speech and of the press; the right to be heard as to taxes levied and expenditures made — all these and more were the heritage of those ventviresome souls who crossed the Atlantic in their search for new worlds In which to enjoy their hard-won Uberties. When the Revolutionary War and the years immediately fol- lowing demonstrated that the Colonies mxist form a more perfect union these personal liberties were assimied by the framers of tha Constitution to be so self-evident that they need not be expressed; but when the people themselves were called upon to ratify tha proposed Constitution, they would have none of it xmless those liberties were nominated In the bond. And so came the first 10 amendments— the Bill of Rights. They are Indeed a charter o< personal liberty, for they set apart a field Into which Congress Itself may not Intrude. Beca\ise of these amendments we may now go to the chxirch of our choice: we may say what we think; we may follow a vocation to our liking; we may towfully bargain with our neighbors; we may scrimp and save, knowing that our savings will be our own; and we may educate our children as we think they should be We may not be imprisoned nor deprived of the fruits of our toll except by -Jiie law of the land and the Judgment of our peers. This is thQ keel of the ^hlp, which some academic theorists would have us abandon. The other timbers In the hull serve but as braces for the keel. Within a dozen years of the adoption of the Constitution Congress became Impatient of the restraints Imposed upon its powers. No more universal or vicious instinct Is woven Into the frailty of human nature than the desire for power; and power feeds and thrives on power. Congressmen, glTen power In a limited field. felt an urge to plough in fields forbidden them. So they enacted laws that Infringed the liberties of the citizen. Called to task, they denied that they had crossed the line Into the forbidden fields. When It was proposed to submit the question of their trespass to the courts, they indignantly replied that only Congress could determine whether Congress had trespassed, that no such power was in the courts. A hundred and thirty years ago the question came before the courts, with Congress on the one side and the people on the other. The great Cbiet Justice demonstrated to a mathematical certainty that there could be no sanctuary' of per- sonal freedom if Congress could enter it at lU will; that restraints on Congress would be a mockery If there was no power to restrain them; and that if Congress did deny the right to a trial by Jury, or did prescribe a state religion, or did infringe upon the freedom of the press, the courts were in duty bound to declare that Con- gress was not empowered by their constituents to Invade the sanctuary and acts therein were nullities. Through the interven- ing years politicians have sought to throw off the restraints upon their ambition to require their neighbors to cast their lives in a mold designed by them; various devices have been suggested — the recall of decisions, the recall of Judges, that the coxirt must be unanimous, or nearly so; and now by the thin subterfuge that the restraints do not operate in time of war or of emergency. The argument that constitutional guaranties of individual rights are suspended In time of war or great emergency Is not a new one. It was made with great force to the Supreme Court of the United States at a time when the country was aflame from the Civil War. It had its answer from that tribunal in these words: " Time has proven the discernment of our ancestors; for even these provisions, expressed In such plain English words that it would seem the ingenuity of man could not evade them, are now, after the lap.se of more than 70 srears. sought to be avoided. Those great and good men toresaw that troublotis times would arise, when rulers and people would become restive under restraint, and seek by sharp and decisive measures to accomplish ends deemed Ju.st and proper; and that the principles of constitutional liberty would be m peril, unless established by Irrepealable law. Ths history of the world had taught them that what was done In the past might be attempted In the future. The Constitution of the United States is a law for nilers and people, equally In war and In peace, and covers with the shield of its protection all classes of men, at all times, and under all circumstances. No doctrine Involving more pernicious consequences was ever invented by the wit of man than that any of its provisions can be suspended dxir- Ing any of the great exigencies of government. Such a doctrine leads directly to anarchy or despotism " (Ex Parte Mllllgan, 71 U.S. 2, 120). While the rights of our people are enshrined In time of war as in vime of peace, it is of course true in any civilized society that the enjoyment of those rights must be consistent with the rights of others. Freedom of the press confers no license to libel: freedom of contract gives no right to oppress by agreements In restraint of trade. " Reasonableness " Is the test of many Icgis* latlve restrictions on absolute right; and the circumstances of tbe times may well throw a l^ht on what U or is not a reasooakle restriction. The coiu-ts may well be Intrusted with a determi- nation of the effect of the depression upon the reasonableness at legislative fiat; but to embrace the doctrine of suspenrton at an absolute right during an emergency is to plunge directly Into chaos, for it is submitted that if our liberties are only safe In quiet waters when there Is no attack upon them, and are gon« 140 CONGRESSIONAL RECORD— HOUSE when the clouds gather, and Congress can determine when the clouds have gathered, we are back where our foreXathers weie before the struggle for freedom had been won. One other of the supporting beams must not pass unnotlcer\\rfiJ> TrcQiAM A T , PF.rnPD — TTOTTSR January 5 1934 CONGRESSIONAL RECORD— HOUSE 141 manifested tbere Is something that warms tbe cockles of the heart, and truly makes life more worth living. It was such a friendship that was the inducing reason for this memorial. If I here may be allowed to digress and philosophize a little, I should like to make the observation that every normal man or woman should have a hobby; something he or she may play at not a hobby to be ridden to death, but one that may be mod- erately and sanely Indulged at proper Intervals. Then, when the problems of life depress and crowd upon us, we may leave care behind us and, for a while, live in the untroubled atmosphere of our play-world. And if, perchance, we find this retreat by the side of the running streams or on the rippling lake, with the green glades of the forest about va, with Ood's sim shining down upon us, with peace and quiet In our souls, and the lordly bass waiting In the shadowy depths to do us battle, then, sirs, in- deed, we are fortunate, and life is worth the living. I am sure that there was no other place that Will Wood loved as he did this lake. He came here when the labors of public life and sendee ovei;t>urdened him and here he found healing and contentment In the peace of these quiet waters. Old friend, not again will we see you, trudging down to your boat polee in your hand, your battered hat askew upon your head. cigar smoke arising like incense to the gods, and the heart of a boy shining out of your eyes! But wherever you may be, let us hope that you have fomyl a quiet, grassy spot, where soft breezes play, and waten ripple. where you may sit and rest awhUe until we Join you. azid haU each other once again, as friend to friend. It Is my great privilege, my friends, to dedicate this building to the service of fishermen and good fellows, and to the irtemorv of WIU R. Wood. Mr. DOUGHTON of North CaroUna. Mr. Speaker. I move that the House resolve Itself into the Committee of the Whole House on the state of the Union for the further con- sideration of the bill (HJl. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes. The motion was agreed to. Accordingly the House resolved itself into the Committee of the Whole House on the state of the Union for the fur- ther consideration of the bill HJl, 6131, with Mr. Bank- HEAO in the chair. The Clerk read the title of the bilL The Clerk read as follows: Sbc. 2. Paragraphs (3) and (4) of subdivision (a) of section 800 of the Revenue Act of 1918, as amended (relating to the tax on distilled spirits generally and the tax on distilled spirits diverted for beverage purposes) [U.S.C., sup. VI, tiUe 26. sec. 1150(a) (1) and (2) ], are amended to read as follows: "(3) On and after January 1, 1928. and untU the effective date of the Uquor Taxing Act of 1934, »1.10 on each proof gallon or wine gallon when below proof and a proportionate tax at a Uke rate on all fractional parts of such proof or wine gallon; and "(4) On and after the effective date of the Liquor Taxing Act of 1934, $2 on each proof gallon or wine gallon when below proof and a proportionate tax at a like rate on all fractional parts of such proof or wine gallon." Mr. O'CONNOR. Mr. Chairman, I offer an amendment. The Clerk read as follows: Amendment offered by Mr. O'Connok: Page 2. line 7. after the figures " 1934 ", strike out "$2" and insert In Ueu thereof " »4" Mr. O'CONNOR. Mr. Chairman, the amendment I have just offered is in line with what I called to the attention of the House yesterday. I did, however, at first take the figure of $5 a gallon, but I decided to compromise in between the suggestion of the distinguished gentleman from Washington [Mr. Hill] that whisky could probably stand a tax of $3 and my $5 tax. I am therefore offering the figure of a tax of $4 a gallon. I shall not reiterate what I said on this subject yes- terday, except to say again that the amount of the tax does not enter into the question of price at all. You are paying prices today which are extortionate with a tax of only $1.10 a gallon. You would pay the same extortionate prices today If there were no tax at all. The Grovemment should get the bulk, or a portion, of these extortionate profits. A tax of $4 a gallon today is comparatively less than the tax was before prohibition based upon the vrice of the product when it comes to the consumer. It is not the 40 percent the distillers paid before prohibition. I cannot understand the solicitude of some people for these few distillers. Surely they could not have tbe con- siuier in mind. They could not have the Government in mind, when they want to keep the tax down low for the distiller, who will charge just the same price no matter what the tax is. How is it that oar Oongress Is so solicitous for such a small group? There are many people who think the Coi^ress has not been so sohcitous for our own gov- ernmental employees, for instance. There are many people who think the Congress has not been so solicitous for the veterans of our ^'ars. Now, why should we be so solicitous for a handful of distillers who arc going to rob the American people of hundreds of miiiinn«f of dollars In the next few months? — We should have a higher tax, and I. as one who has fought for repeal, who has fought to restore to those of the American people who wish to drink the right to do so. as one who has fought to remove from the Constitution that iniquitous eighteenth amendment — and no one can question my wetness — I submit to this House that an adequate tax should be obtained from this traffic for the benefit of our Grovemment. [ Applause. ] Mr. DOUGHTON of North Carolina. Mr. Chairman, with due respect to the opinion and judgment of the gentleman frwn New York, I trust the ansendment he has offered will not be adopted. This question of the rate of tax, of course, was more controversal than any other matter which came before the committee in the preparation of this bill; but, so far as I know, not a single member of our committee, after due consideration, afte\ full hearings, after consideration of the report of the interdepartmental committee, thought a tax as high as $4 per gallon would be justified. Now, of course, if conditions would alwasrs remain as they are at present, there might be some justification for such a tax. Everyone knows, however, that present conditions with respect to Uquor are abnormal, due to scarcity. Scarcity causes the high prices and enables those in posses- sion of the limited supply to demand and extort exorbitant prices. But as conditions become more normal, as the sup- ply becomes more abundant competition will be regulated. There is no doubt in my mind that a rate of $4 will prove entirely unreasonable, give too much leeway to the boot- legger, and result in much less revenue to the Government. I trust the amendment will not be agreed to. Mr. McKEOWN. Mr. Chairman. I move to strike out the last word. So far as I am concerned. I would like to see the entire profit taken out of the liquor business. That is what I think about it. I do not know about this |2 or $4 a gallon, but I do know that the ccxisiuaer should be offered good, pure whi^cy at cost. This would tend to restrict the bootlegging in this country. My theory is that if you take the profit out of liquor and the profit out of war, you will have peace on earth and soberness at home. That is my thought and my theory. [Applause.] Five years ago I went to the leaders who made the great fight through the years to put the prohibition amendment in the Con^itution. I urged them to assist the Congress of the United States to pass an act whereby good, pure liquor would be di^)ensed at absolute cost. If the Uquor did not cost iHit 40 cents a quart then there would be no occasion for the whoopee parties. When Uquor is hard to buy and at a high price the citizen buys a quart at $10 and luoceeds to invite his neighbors into a party azid celebrate the fact that he was able to get a quart of liquor and Chen consume it in a celebration of the purchase. If he could buy that same whisky for 40 cents a quart there would be no attraction so far as the neighbor was concerned at alL I regret the necessity of having to levy a tax on Uquor. because I do not Uke tbe idea of whisky profit, not even for tbe Oovemment. Mr. MAY. Wm the gentleman yield? Mr. McKEOWN. I yield to the gentleman. Mr. MAY. I would like to ask the gentleman if be would not think it would be conceded by everybody tiiat if we fixed this tax at $4, no legitimate manufacturer who oper- ates under the law will sell any liquor for less ***»•>* |4 *tirt that that gives a much wider margin for tbe bootlegger? Mr. McKBOWN. You say " legiUmate manufacturer." I hope we have some l^;itimate manufacturers left many numan conu^cis ana memories. Here on tne oanjcs az Tranaquaklng River, from times going back of tilstory, an tae Indlui tie to. rne give and tase oi sucn an association, tne nne spiriv of coiirtesy and sportsmanship and good fellowship that may be 142 CONGRESSIONAL Mr. MAY. I mean those that operate under the law. Mr. McKEOWN. Here is the result: You will have not only the bootlegger to deal with, but you will have a task finding the legitimate distiller who will actually go along and follow the law. I hope you will fix it in such a way that when liquor is sold it will be good liquor, pure liquor, and not some of the kind that the bootlegger sells. Mr. O'CONNOR. Will the gentleman yield? Mr. McKEOWN. Yes. Mr. O'CONNOR. Has the gentleman ever tasted this stuff the so-called " legitimate distiUeries " are selling today? Mr. McKEOWN. No. I would advise the gentleman not to. But I have seen the effect ai both Mr. O'CONNOR. Mr. McKEOWN. kinds. Mr. OTilALLEY. Mr. McKEOWN. Mr. O'MAT.T.EY. Will the gentleman ]rield? Yes. If the gentleman wanted to bring repeal into disrepute, would the gentleman not load up wine and beer with a heavy tax. as we are doing here, and let the liquor off? Mr. McKEOWN. I believe in law and I believe in trsring to have laws that are reasonable, laws which will have the respect of the people, and laws which wiU be enforced. Here is what I want to see in this country: I want this crowd that is breaking down all respect for law put where they should be. I want to see them put out of the range of society. want to tell you that the bootlegger is one of the worst criminals that are loose in this country. Pix it so that the people will have good liquor and at a price that will not cause them to have to go and buy from a bootlegger. Mr. O'CONNOR. Will the gentleman yield? Mr. McKEOWN. I yield to the gentleman from New York Mr. O'CONNOR. Does the gentleman think it glorifies the bootlegger to go into the legitimate distillery business, and that that makes him a respectable citizen, because the ex-bootlegger is what you have in the distillery business today? Mr. McKEOWN. I think you are going to have a lot of trouble with some of your so-caUed " legitimate distillers." The CHAIRMAN. The time of the gentleman has expired. Mr. ROGERS of New Hampshire. Mr. Chairman. I rise in opposition to the amendment. Mr. Chairman. I have the honor to represent a district in a State which before the World War was a local option State. This permitted every community, town, and city to decide whether or not such municipcUities would legally sell intoxi- cating liquor. As a result of this legislation, a great deal ol revenue was brought into the State treasury by towns and cities that voted to permit the legal sale of intoxicating liq- uors; and notwithstanding the taxes then paid to the State and to the Inderal Government, the his^est class of whisky, gin. or rum was sold for one dollar to one dollar and a half a quart, and yet today it is suggested that we levy a Federal tax of $4 a gallon. | The bill itself provides a tax of $2 a gallon, whldi would mean 50 cents a quart. Tliis is too much. The tax ought not to be more than $1 a gallon to insure its reasonable collection. I do not speak as a friend of the brewers or the distillers or the bootleggers. I am a friend of the purchasing Ameri- can public, and I say. Mr. Chairman, that when we put on a tax of $2 or $4 a gaUon we are simply turning the business into illegal and disreputable channels. We should take steps to see to it that the American Republic, now that the eighteenth amendment is repealed, shall have a law which will be respected by a majority of our citixens; and we can- not have such a law unless we provide a Government tax on liquor which will make it possible for men engaged in legiti- mate traffic in intoxicating liquors to fix a fair and reason- able price, resulting in a reasonable profit. My friend the gentleman from New Y(H-k [Mr. CCoiiirot] is going to ask me a question. I have listened to him very carefully. I have read his address before the committee, RECORD—HOUSE January 5 and I have listened to him on the floor of the House. I realize fully all that he says about bootleggers, about dis- tillers, and about brewers; but the fact that they are robbing the American people is not the question here and is no reason why the United States of America should rob its citizens, and I hope, Mr. Chairman, this amendment will be defeated. [Applause.] Tlie CHAIRMAN. The question is on the amendment offered by the gentleman from New York [Mr. O'Connor]. , ■nie amendment was rejected. Mr. DIRKSEN. Mr. Chairman, I offer an amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. Dirksen: Page 2. line 7, after the figures " 1934 ", strllce out " $2 " antf Insert In lieu thereof " «1.60." Mr. DIRKSEN. Mr. Chairman, for the benefit of those who were not present during the general debate yesterday when the bill was under consideration, I simply want to emphasize the fact that according to the report of Mr. Woodcock, one-time Prohibition Administrator, who was an ardent dry and an ardent prohibitionist, for the fiscal year 1930 the consumption of bootleg booze in this coimtry amounted to 73,000,000 gallons, which is 50 percent of the total consumption of liquor in the peak period before prohi- bition came into effect. I see no better way to perpetuate the bootlegging element in this country than to insist upon a high tax upon liquor. About 3 weeks after repeal became effective, some wag made the remark that repeal would be a splendid thing if we ever had it in this country, and it now seems to me that we are going to becloud this entire matter with silly and inane restrictions and ultimately lose for the people of this coun- try the precious benefits of repeal. I have heard the contentions of my good friend the gen- tleman from New York [Mr. O'Connor]. I want to say for the benefit of the House that the gentleman came out to my district this summer and laid the cornerstone of the world's largest distillery, having an estimated capacity of 50,000 gallons per day. I carmot understand precisely why my friend from New York should have such a yen for the legiti- mate distilleries, of which I will have seven in my district in Illinois. In all of his contentions for a high tax he has failed to show how you can take a $2 tax for the Federal Government and add a $1 State gallonage tax, add on mu- nicipal license fees and all the other expenses, and give the legitimate distiUer a chance to compete with the bootlegger over on the other side of the ledger who starts in the busi- ness with exactly the advantage of zero so far as taxes are concerned. My solicitude is not for those who operate the distilleries; it is for the American people and for weaning them away from the bootlegger and seeking to dislodge the bootlegger, who is now entrenched in American national Me. It will loe quite a time before the bootlegger is di&lodged. The element of price does not enter into this bill. If there is profiteering, or if there are exorbitant profits being made at the present time through the instrumentality of the so- called " excess-iMTofits tax ", we can recapture such profits, and for that reason that question does not enter into this discussion. I am in sympathy with what the committee wants to do. Their whole idea is to raise a certain aggregate amoimt of revenue, and this depends upon consumption, and I say that with a $2 tax. as distinguished from $1.50 tax. you are not going to get the estimated consumption or the estimated revenue, and you are not going to dislodge the bootlegger. Gentlemen, I respectfully urge you to vote for this amend- ment to decrease the tax from $2 to $1.50 a proof gallon. [Applause.] Mr. SABATH. Mr. Chairman and gentlemen. I feel that the Wajrs and Means Committee, having sat for more than 4 weeks and heard many witnesses on this question, has submitted a fair and sane bill. I am satisfied that some of the members of that important committee did not at first favor a high tax and some did not favor a low tax on whisky. But I believe that their final action should 1934 CONGRESSIONAL RECORD— HOUSE 143 satisfy the House that they have acted wisely and pru- dently and that we have a fair bill before us. Therefore I feel that this amendment or any other amendment should not recrive suppcnrt from Members of this House, because the Members of the House have not been in the position of members of the committee, who have diligently, carefully, and faithfully listened to many well-informed witneoGCs on this proposition. I wish to compliment the members of the committee on their splendid work and the conclusions they have reached. Now, as to what has been said about Peoria, I wilf say that, had the gentleman from New York [Mr. O'Cowkor] known of the fraud that this Canadian liquor institution purposed perpetrating upon the people of the Nation, he would not have honored it by his presence at the lasring of the cornerstone. He could not have known that this Canadian company, which is daily broadcasting its tre- mendous output and contemptuously unloading upon de- ceived American citizens colored alcohol and branding it as whisky, would be guilty of something that even the lowest and most disreputable bootlegger would not have dared to do during prohibition days. Had he, or any other of us who for years advocated repeal of prohibition, known that the distillers would be guilty of the charges now being made against them, I know that every effort would have been made to forestaU these condemnable abuses. Therefore I urged the Ways and Means Committee to put a proviso Into its bill prohibiting the misbranding of any liquor and requiring a suitable stamp on each bottle show- ing exactly what the bottle contains. If it is supposed to contain whisky, let it be whisky; and if it contains a blend or an imitation, let It be so stated on the label, so as to protect the people from imposition. This amendment, I tmderstand. will be offered by the painstaking and able chairman of the committee, and I hope it will be adopted Mr. BRITTEN. Will the gentleman yield? Mr. SABATH. Not now. much as I should like to accom- modate my good friend. The gentleman from Illinois is an expert on French wines. I know he has used them In the past. Mr. BRITTEN. Will the gentleman yield? Mr. SABATH. I listened only yesterday with consuming Interest to the gentleman's recital of the situation relative to imported French wines. I do not know whether the gen- tleman continues to use French wines as he has in the past, but I do know that there is not a Memt)er of this House so expert on French wines as is the gentleman from Illinois. Mr. BRITTEN. Now wiH the gentleman yield for a short question? Mr. SABATH. Yes; I gladly yield. I always grant any request of my esteemed colleague if and as soon as practi- cable. Mr. BRITTEN. I was going to ask the gentleman when he was going to return the bottle of gin he borrowed of me 3 years ago. [Laughter.] Mr. SABATH. Having at all times advocated the repeal of the eighteenth amendment and insisted upon its enforce- ment while it was upon our statute books, contrary to the practices of some of my dry friends, whom I have never crtticlxed for their transgressions. I remain a grateful debtor of my affable colleague for the bottle of gin he loaned me and which was badly needed; but. not wishing to violate the law of our good land, I could not purchase another bottle of gin, and therefore could not return it. Neverthe- less, I now promise in this presence to repay in kind my accommodating friend that bottle of gin as soon as the pro- hibition law still In effect in the EMstrict of Columbia shall be repealed; and when I do so It will be with twofold inter- est, with my everlasting gratitude, and a really high-grade gin— certainly better than he loaned me — ^not from France, but made in the good old United States of America! [Laughter.} In conclnslon, let me advert for a brief moment to the reoMrk of another of my colleagues from Illinois, Mr. DntKsrw. who represents the city containing the largest Xriant of this Canadian hquor Institution, about alleged boot- legging In the House CMBce Building. I really think that statement is most unfair, unjust, and uncalled for. I have been a Member of the Congress for nearly 28 years and I have therefore been in better position to observe any possible liquor violations by Members than bos the gentleman from Illinois [Mr. IDntKSKN] during the few months he has been here; and I can truthfully say, to the honor and repuUtion of this House, that I never have been approached by and never have seen a bootlegger in the Capitol or in the House Office Building. True, at times some Members may have and probably did obtain a bottle of medicinal whisky or a sample of home- made applejack, both of which doubtless relieved them; but at no time have there been such flagrant abuses and viola- tions as some Members, like my young and promising col- league from Illinois, Mr. Doiksek. would have the country believe. It is to be regretted that these idle jest3 are fre- quenUy utilized for purposes of detraction and pubUcity and to unfairly discredit the Membership of the House. Let u* hope that such practices will soon be discontinued and that all Members will be careful not to make unwarranted charges and insinuations tending to bring upon the House an odium of disrepute. Also it is to be regretted that personal or selflrh national likes and dishkes and prejudices and favoritlsms should in- fluence the activities and remarks of some of my Republican colleagues upon the floor of this legislative body. [Here the gavel feU.] Mr. VINSON of Kentucky. Mr. Chairman, it is not a difficult matter to be critical, particularly with reference to taxation. The Ways and Means Committee reached the figure of $2 after they had heard dozens of witnesses on the subject. The subcommittee first met in September. Hearings continued throughout the fall. The last witnesses appeared just before Christmas. After repeated conferences with representatives from the Treasury Department, with representatives from the Tariff Commission, with represenU- tives from the Department of State, we compromised on the figiu^. Some favored a higher rate, others a lower rate. There is more to this tax rate than just writing a figure into the bill. You must take into consideration the effect of the tax upon consumption, upon smuggling, and upon bootlegging. We have on hand only 1,000,000 gallons of pre-war liquor. We must take into consideration a doaen factors when arriving at the tax rate. The Ways and Means Committee does not for one moment say that this figure is the pertect figure, but it is the best figur« in their com- posite judgment. With reference to the bootlegger, we were told by a man who seemed to know, that the bootleggers today were fur- nishing thousand-galloo liquor lots at $1 per gallon. That is quite conclusive that the $1.10 tax now imposed does not keep that illicit distiller out of business. There is much in what the gentleman from New York [Mr. O'Connor] says with reference to a larger tax In this flush consumption period, but this Congress cannot merely legis- late for a day, this Congress cannot legislate for this par- ticular condition. Congress must legislate not on each proof LXXVm- -10 146 CONGRESSIONAL RECORD— HOUSE gallon where 80 percent of »ny additional »0 on each proof gallon where 50 percent of any addi- tional liquid is added: »5 on each proof gaUon where 60 pereect of acy additional liquid Is added." Mr. McCLINTIC. Mr. Chairman, it was my hope that th 5 arriendment offered by the gentleman from New York [Ml . O'Cormoiil could have been thcluded In thia bill, and I exceedingly regret that it was held to be not germane to th b bill. I realize, and I think you do. that if we pass a la^^ without having some provision in it that relates to rectifie i or blended liquor, the purposes of the bill will be defeate< '.. Inasmuch as the amendment offered by the gentleman froii i New York (Mr. O'CoimoR] was held to be not germane. I hastily drew an amendment that I thought was germani;, setting out a schedule besrinning at 10 percent and running up to 60 percent, which applies to the addition of any liquii to liquor. Mr. SAMUEX B. HILL. Will the gentleman jrield? Mr. McCLINTIC. Yes. Mr. SAMUEL B. HILL. We did not know anything aboit the gentleman's proposed amendment before it was offered. Really. I have it not very clearly in mind. I am wonderirg how you are going to determine the amount of proof spiri s that have been added to these blends? As a practical proi - osition, who will determine and how will It be determined just how much proof spirits have been added to the blende d whisky? Mr. McCLINTIC. I am glad to have the chairman of tl e subcommittae ask that question. We all know that the Pu; e Pood and Drugs Act lias a bearing upon any kind of a con i- pound that might be offered for sale to the public. ¥e likewise know that the department of the Oovcmment th it is called upon to enforce the law has a right to put in o effect regulations that are germane. So if we provided th; it such added liquid equal to 10 percent shall be taxed a certa n amount, then proper regulations can be put into effect ly the particular department that has jurisdiction over tlie enforcement of this law. Mr. SAMUEL B. HILL. Will the gentleman yield? Mr. McCLINTIC. In a minute. I am going to agree with the gentleman that this amend- ment was hastily drawn. I am interested in the same thij ig that the gentleman is interested in and that every membn: of this Committee is interested in. and that is to cause this legislation to bring to the Government the greatest amount of money possible, so that it can carry on the rehabilitati< n program now in effect. Mr. SAMUEL B. HILL. I take it your plan is by reguli- tion to determine how much liquid has been added in these blends. As a practical proposition, how are you going to do that by regulation? How are you going to determine i That is what I am interested in. I understand that no chemist or no Individual, unless he was standing right the re and saw the contents going in. could tell how much adqi ^ional Uquid had been added to make a certain blend. ^" The gentleman admits that the amendment has be*n hastily drawn and that it is not just as he would like t. Does not the gentleman feel it would be better to postpone this matter and let it be taken up in the other body, at whi^h time it could l)e given proper consideration? Mr. McCLINTIC. I am in accord with the gentleman if the Committee is willing that we may return to this sectic n. As a matter of fact. I should prefer to have a little more time to study it. If the gentleman Is wiUing to have it pass k1 over; all rii^t. I merely wished to preserve my right so that I would have the opportunity of making the present i- tion that might produce the result whlck nearly every lfez|i ber of the House would like to see. Mr. KNUTSON. Will the gentleman yield? Mr. McCLINTIC. I 3^eld to the gentleman from Minr^- sota. Mr. KNUTSON. The gentleman from Oklahoma Is member of the committee and will recall that at the hei^ tngs it was disclosed that there Is only something l^ce 1.000.000 gallons January 5 Mr. McCLINTIC. Will the gentleman please ask his ques- tion? Mr. KNUTSON. There is ohly something like 1.000,000 gallons of aged, distilled whisky available at the present time, and it will be necessary, in order to supply the de- mand, to put a considerable quantity of rectified and blended whisky into the channels of trade. Mr. McCLINTIC. I hope the gentleman wUl not take any mere of my time. [Here the gavel fell.] Mr. McCLINTIC. Mr. Chairman. I ask unanimous con- sent that I may have 3 additional minutes, inasmuch as my time has been consumed by questions. The CHAIRMAN. Is there objection to the request of the gentleman from Oklahoma? There was no objection. Mr. McCLINTIC. The amendment which I have offered is germane Mr. KNUTSON. I am not questioning its germaneness. Mr. McCLINTIC. And it is perfectly simple. It simply means that if 10 percent of any other liquid is added, the Government will get a tax of $2.50 a gallon; if 20 percent of any other liquid is added, the Government will get $3 a gallon; and if 30 percent is added, $3.50; and if 40 percent is added, $4 a gallon, and so on. In other words, it will act as a prohibitory measure against those who may have a tend- ency to try to sell the American people something that is not really what they think they are buying: and I am hope- ful we can protect the public, if we have to have a law of this kind, to the extent that we will not be confronted with the same situation as the one which exists at the present time and which everyone in this House knows about. We have all read in the papers about the liquor that has been sold in various cities that is not even what might be called liquor but simply a compound that is put up for the pur- pose of making a large profit. If certain individuals intend to participate in this kind of practice. I want the Govern- ment to be the beneficiary to the extent of getting an in- creased tax. If the House wants to take any action on it. very well. I have presented the matter hastily, it is true, but I-know the amendment is germane, and if it is added to the bill, the department of the Government that has jujris- diction will have sufficient power to draw regulations to take care of the situation. It has been charged time after time on this floor that the distillers have engaged in practices with respect to selling liquor that are wholly unethical, and it is now known that a large majority of such products as are now on the market are not fit for human consumption. I take the position that if this Nation is to allow the selling of liquor, that the public is entitled to know what it is buy- ing; and the only way to place proper safeguards is to in- crease the tax on all kinds of compounds, thus increasing the revenue to the Government, so that such money as is obtained from this source can be expended in a way that will be beneficial to humanity. The CHAIRMAN. The question is on the amendment offered by the gentleman from Oklahoma. The question was taken; and on a division (demanded by Mr. McCLINTIC ) there were — ayes 31, noes 57. So the amendment was rejected. Mr. WEIDEMAN. Mr. Chairman. I offer an amendment. The Clerk read as follows: Amendment offered by Mr. Wetoeman: Page 2. line 7. after "♦2", lOMrt "when used for beverage piupoees and $1.10 when used for the manufacture of medicines." Mr. WEIDEMAN. Mr. Chairman, I should like your iiv- dulgence for just a minute. My amendment is not for the purpose of changing the law in any respect. It Is simply for the purpose of carrying out the will of the people. THX TAX ON SPIXrrS SHOUU) NOT PZNALZZK THX SICK I do not think anyone intended to impose a tax upon alcohol used in the manufacture of medicines, and it is for that purpose, and that purpose alone, that my amendment is offered. 1934 CONGRESSIONAL RECORD— HOUSE 147 The amendment is for the purpose of leaving the tax on spirits used in the manufacture of medicine at $1.10 a gallon instead of increasing it to $2. I do not think we should penalize the sick or the maimed at this time, par- ticularly inasmuch as at this very minute the medical code and the manufacturing pharmacists' code are being consid- ered at the other end of the Avenue and the manufacturers of medicines are being asked to increase the pay rolls in their factories and at the same time are asked not to in- crease the price of medicines at this time. I have been informed by the largest pharmaceutical manufactiirers in the world. Parke. Davis tt Co. and the Frederick Stearns Co.. of the city of Detroit, that they would be glad to comply with their code and raise wages and not raise the price of their produce, but that the tax should be left as at present. If we wish to aid the administration in raising wages at this time and not increasing the cost of medicines, which are made by the use of alcohol to a great extent, I think you should bear with me and vote for this amendment. Mr. COCHRAN of Missouri. I wish the gentleman would tell us how much will be taken out of the bill if the amend- ment passes. I received a letter this morning from one of the largest drug-manufacturing houses in the world, the Meyer Bros. Drug Co.. of St. Louis, protesting against the tax on alcohol for medicinal purposes. Naturally I am in- terested in the gentleman's amendment. I understand the committee's view is that this tax is necessary in order to prevent medicinal alcohol from being diverted for beverage purposes. I know the revenue must be raised, but. as the gentleman from Michigan suggests, is it wise to tax the sick? Mr. WEIDEMAN. I do not know at this time what amount of taxes will be taken out of the bill; but, regardless of that fact, a sick person is under enough of a handicap without having to pay an exorbitant tax on his medicine.5, either directly or indirectly. Mr. DOUGHTON of North Carolina. Mr. Chairman, I trust the amendment of the gentleman from Michigan will not be agreed to. I am sure the motive of the gentleman is good, but I am also sure that the amendment would not be practical from the standpoint of administration. It would be almost impossible to determine Just what percentage of liquor would be used in the manufacture of medicine or what amount would be necessary to be used for medicinal purposes and what amount would be used for beverage purposes. This would be a constant source of irritation and diffi- culty so far as the administration of the law is concerned, and there would be more people wanting to manufacture some kind of medical concoctions with intoxicating liq- uor in it than we have ever head of; in fact, we all know that a large percentage of the patent medicines is htmi- bug anyway; and this being so, why give an opportunity to evade the pajmient of taxes when the Treasury is in dire need of revenue in order that we may, in the name of re- lieving the sick, enable a certain class to escape taxes? Mr. COOPER of Tennessee. If the gentleman will permit, under the proposed amendment, all the prescription liquor would escape this tax, and I am informed that in some instances whisky itself is defined as a medicine, and in addi- tion to this, what would become of all other liquor besides medicinal and beverage Uquor? Under this proposed amend- ment it would all escape taxation. Mr. WEIDEMAN. I think that is taken care of in the amendment. Mr. DOUGHTON of North CaroUna. The proposed amendment would serve no good purpose and should be defeated. The CHAIRMAN. The question is on the amendment of- fered by the gentleman from Michigan. The amendment was rejected. Mr. BLANCHARD. Mr. Chairman, I offer the following amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. Blanchabo: Page 2, line 9. after the word " gallon ", Insert " Provided, That of said tax coUected 50 cents per gallon shall be allocated and paid to the several States on the basis of the amount purchased in each State." Mr. DOUGHTON of North Carolina. Mr. Chairman, I make the point of order that the amendment Is not germane to the biU. The CHAIRMAN. The Chair sustains the point of order. Mr. HOLLI8TBR. Mr. Chairman. I offer the following amendment. The Cletk read as follows: Amendment offered by Mr. Hoixiam: Page 2. atrlke out Unas S to 9. incliislTe. and insert in Ueu thereof the foUowlag: "(4) On and alter the effective date of th* Uquor taxing act of 1934. 11.10 (or if withdrawn for beverage purpoMa or for use In the manufacture or production of any article imd or Intended for use as a beverage, a tox of $2) on each proof gaUon or wlna gallon when below proof and a proportionate tax at a Uke ntm on all fractional parts of such proof or wine gaUon." Mr. HOLUSTER. Mr. Chairman, this amendment Is somewhat similar to the amendment offered recently by the gentleman from Michigan [Mr. WxzdbxakI, but whereas that amendment solely made a distinction between medical and beverage alcohol, you will note that this amendment makes a distinction between nonbeverage and beverage al- cohol. I suggest that the tax on nonbeverage alcohol be left at $1.10 per gallon as it is now and that a $2 tax be placed upon beverage alcohol, as suggested by the committee. This permits the acquisition of alcohol for medicinal pur- poses, alcohol for flavoring extracts and toilet articles, and similar nonbeverage purposes at a cheaper rate than for drinking. There wiU be objection made that this will result In a loss of revenue to the Qovemment. I have figures before me for the fiscal year closing June 30. 1932, which show that during that year less than 6,000.000 gallons were used for these purposes, and. therefore, at a differential of 90 cents the difference between the two rates — the loss would be about $5,000,000. That is almost an infinitesimal amount when we compare it to the huge sum which the liquor tax will raise. On the other hand, the housewife who uses flavoring extracts and the users of various medicines con- taining alcohol will be able to acquire those goods at a lesser price. Mr. BROWN of Kentucky. Will the gentleman yield? Mr. HOLUSTER. I yield. Mr. BROWN of Kentudcy. I should like to know bow that would affect the State of Kentucky. We have a law, and have had it for many years, that the only way you can drink liquor is for medicine. Mr. HOLLISTER. This amendment does not cover pre- scription liquor; that would have to pay the regular rate. Mr. COOPER of Tennessee. Will the gentleman yield? Mr. HOLLISTER. I yield. Mr. COOPER of Tennessee. Under the gentleman'^ amendment there would be a loss of $5,000,000 in revenue. The gentleman's argument is that the price of the commod- ity would be reduced to the purchaser. Five million dollars spread over 120,000.000 people, how much does the gentle- man think would be reflected to the purchaser? Mr. HOLLISTER. That is an argument that can be made with respect to every tax. that it would be negligible when spread out over the whole people. On that theory you can put on any kind of tax that yoa want and answer objections to It by saying that If you spread it around the country it would affect everybody very Ijttle, and therefore reasonable objections should not be considered. It does seon, however, that it Is fair and proper to make a differential between beverage and non- beverage alcohol. That same differential has been made before. The rates in effect just prior to prohibition taxed beverage alcohol at $6.40 a gallon and nonbeverage alcohol at $2.20 a gallon. I am merely asking that we leave the nonbeverage rate at $1.10, and put the beverage rate In at the new rate reported by the ctunmittee. Mr. VINSON oi Kentucky. Mr. Chairman, win the gen- tleman jrield? Mr. HOLLISTER. Tes. Mr. VINSON of Kentucky. What does the gentleman say with reference to the administration rfifw^iit4ff that would arise under his amendment? 148 CONGRESSIONAli RECORD— HOUSE January 5 Mr. HOLLISTER. I do not think they would be nearU as difficult as thej have been, and yet it is weU known tha t under Conmiissioner Doran recently there has been very lit|- tle diversion. Mr. VINSON of Kentucky. But the gentleman must a<3 mit that when there are two rates it would be somewhat difBcult of administration. Mr. HOLLISTER. I could not answer the gentlem^ but it would seem that under a proper permit ssrstem diver sion could be guarded against, particularly when the divei sion incentive which existed before repeal has now disaij- pearcd. Mr. SAMUEL B. HILL. Mr. Chairman, the amendme: offered by the gentleman from Oblo [Mr. HollzstekI all of the objectionable features of the amendment offi by the gentleman from Michigan [Mr. WxatMAXl, and addition to that, it has the potentiality of illegal diversio The gentleman says that the loss in revenue would be $5,000,000, based upon the statistics that we now have a able as to nonbeverage liquor. That Is not a small fea' of the amendment. The loss of revenue In itself is siderable at this time, especially at this critical time in Government's finances: but the opportmlty for dlversi is the greatest objection that can be urged to the adop of the amendment. There Is this possibility: Nonbeve liquor might include medicinal liquor as well as alcohi spirits that go into the concoction of flavoring ext and of perfimnery, and so forth. The' difficulty arising froi administration Is also great, and the committee has glv( serious consideration to this whole problem. It was committee's judgment, the judgment of the majority the committee, that we should not permit this differen between alcoholic liquors going into these concoctions liquor which went out to the trade as beverage liquor, committee hopes that the amendment will be voted dowfa. The CHAIRMAN. The question is on the amendment offered by the gentleman from Ohio. Yhe amendmei^ was rejected. Mr. HASTINGS. Mr. Chairman, during the course of tl le preparation of the pending bill by the Ways and Meaits Committee I submitted as a separate section an amendmei it that would repeal many old statutes enacted for IzuUan Te: - ritory. now Oklahoma, long before statehood. Upon con- sideration the members of the ccnnmlttee decided that, ina i- much as this is purely a revenue-raising measure, the sec- tion that I proposed ^ould be submitted to and considen d by the Judiciary Committee of the House. Upon examiiui- tion of the Ull as reported by the committee I do not fiid incorporated any regulatory provisions. For that reason I am not (rflering the amendment here, because I apprecia« it would be held not germane, as was ruled by the CHiair ( n another amendment a few moments ago. Following tlie suggestions of the members of the Committee on Ways ax d Means, I introduced the proposed amendment as a separa « bill, which has been referred to the Ccanmittee on tlie Judiciary. The bill HJi. 6319. which I have introduced, has for i;s purpose the repeal of certain specific acts of Congress, ai d an amendment thereto, to regulate the manufacture, sac, and possession of intoxicating liquor in the Indian Tbrritor r, now a part of the State of Oklahoma. It is intended o place the State of Oklahoma, so far as the question of pn »- hibition is concerned, on the same footing as the othnr States of the Union. The bill is as follows: A bill to repeal certain specific acts of Congreai. and an ameni I- ment tlicnrto. enacted to regulate the manufacture, sale, or po i- seaslOD of intoKtcatlng liquors In Ute Indian Tvrltary. now a part of the State of Oklahoma Be it enacted, etc.. That the acta of Oongreaa of July 33, 181 la (27 Stat. 260): January 30. 1897 (29 Stat. 606): aection 8. cbapt ir 143 of the act of Uarch 1. 1895 (38 Stat. 607); and that part >f the act of May 29. 1918 (40 Stat. 563). aa amended by the act >f June 30. 1919 (41 Stat. 4), which is embraced In title 36. V£>X',., aection 244. be. and they are hereby, repealed Insofar as thi y apply to and affect that part of the State of Oklahoma, former y known as the Indian Territory. This bin applies to and affects only the State of Okli^ homa and no other State or Territory. If this bUl is enacted into law, it will enable the people of the State of Oklahoma, without Federal interference, to regulate its own internal affairs on the question of pro- hibition. The eastern part of the State of Oklahoma was formerly known as the " Indian Territory " and was occupied by the Five Civilized Tribes and the Quapaw Indians. The mem- bers of the Five Civilized Tribes were all made citizens of the United States by act of Congress of March 3. 1901, ap- proximately 33 years ago. Final rolls of their citizenship were made and all of their lands allotted under the various agreements and acts of Congress more than 25 years ago. The enabling act (34 Stat. 267) passed by Congress, au- thorizing the creation of the State of Oklahoma, including the Indian Territory, provided: That the manufacture, sale, barter, giving away, or otherwise furnishing, except as hereinafter provided, of intoxicating liquor within those parts of the said State, now known as the Indian tOTltory, and the Osage Indian Reservation, and within any other parts of said State, which existed as Indian reservations on the flrat day of January, 1906, Is prohibited for a period of 21 years from the date of the admission of the said State into the Union. This provision of the enabling act was agreed to, and a provision was incorporated in the State constitution of Oklahoma in conformity thereto and State legislation en- acted from time to time to vitalize the same. The acts of July 23, 1892 (ch. 234, 27 Stat. 260), and January 30, 1897 (ch. 109, sec. 1, 29 Stat. 506), these acts being an amendment of the original act of February 27, 18T7 (ch. 69. sec. 1, 19 Stat. 244). in the last codification are compUed under section 241. title 25. UJ3.C.A., provide that intoxicating liquors shall not be sold to Indians or intro- duced into Indian territory, and that no ale, beer, wine, or intoxicating liquor or liquors of whatever kind shall be intro- duced, under any pretense, into the Indian country. The Supreme Court of the United States in the case of ex parte Webb (225 UJ3. 663) held that these acts continued In force as to the Five Civilized Tribes, the Osage Nation, and that part of the State of Oklahoma to which the 21- year clause applied. The act of July 23, 1892 (27 Stat. 260) , prohibited the sale of Intoxicating liquors of any kind, or their introduction into the Indian country, and provided a penalty of imprisonment for not more than 2 years and a fine of not more than $300 for each offense. The act of March 1, 1895 (28 Stat. 693), prohibited the manufacture, sale, giving away, or introduction into the Indian country of any intoxicating liquors, and provided a penalty of a fine of not to exceed $500 and imprisonment for not less than 1 year nor more than 5 years. The act of June 30, 1897 (29 Stat. 506), prohibited the sale of intoxicating liquors to Indians under charge of any Indian superintendent, or the introduction of liquor into the Indian country, and provided a penalty for violation thereof. The act of May 25, 1918, made possession of intoxicating liquor by a person in the Indian country a criminal offense, nils act was an amendment to the Indian appropriation bill, which provided means for the enforcement of prohibition in the Indian country. This act of May 25, 1918, was amended by the act of June 30, 1919 (sec. 244, title 25, U.S.C.A.), by inserting the one word " or " after the words " Indian country." The language of the two acts is identical with the excep- tion of this additional word " or." This latter act is com- monly known and designated as the so-called " Hastings amendment." The amendment added only the one word " or " to existing law, as above stated. There is much con- fusion and misunderstanding among the people of Okla- homa as to the effect of this amendment. It added no additional penalty to existing law. Penalties were already provided by the then existing acts of Congress. This amendment made the possession of intoxicating liquor an offense where the introduction Is or was prohibited by Fed- eral statute and aided in the enforcement of existing laws by making it unnecessary to prove that the liquor was 1934 CONGRESSIONAL RECORD— HOUSE 149 found in the possession of anyone upon a restricted Indian's allotment. The enactment of the bill which I have introduced will in no wise interfere with the right of the people of the State of Oklahoma to decide for themselves the question of prohibition. The constitution of the State of Oklahoma has a provi- sion prohibiting the manufacture, sale, or possession of intoxicating liquor and the legislature of the State has from time to time passed legislation to vitalize this provision of the constitution by providing the necessary court procedure and penalties for its violation. Let me emphasize that the enactment of this bill will in no wise affect the State constitution of Oklahoma, but it simply removes these Federal legislative snags, some of them enacted more than 40 years ago, and will leave to the peo- ple of the State of Oklahoma to determine the question for themselves. The people of Oklahoma, on July 11 last, by vote, legal- ized the manufacture, sale, and possesion of 3 T beer, and Congress gave its consent through a special bill which I prepared and introduced. The present bill will further remove Federal objection to the manufacture, sale, or pos- session of intoxicating hquors of all kinds and leave the question to the people of Oklahoma to determine for themselves. Mr. CELLER. Mr. Chairman, I move to strike out the last two words. Very much like the gentleman from Okla- homa [Mr. Hastings], I desired to offer an amendment; but, in view of the fact that this bill is purely a revenue bill and not an administrative bill, I shall withhold the amendment for some future occasion when my Committee on the Judi- ciary offers the administrative features supplemental to this revenue bill. I should like to have enacted into a statute a provision which would permit whisky or other distilled spirits to be bottled in bond at an age lower than 4 years. At the pres- ent time no whisky can be bottled in bond unless it be 4 years old. There is so very little whisky in this country that is above 1 year or 6 months old that the bottled-in- bond statute, at least for the time being, will become more or less obsolete. I think that whisky can very readily be bottled now in bond at 2 years of age. Necessity is the mother of invention. Many new inventions have come on the market providing for an artificial aging of whisky. By the use of heat and pressure I understand that they can give an artificial aging to young whisky, making whisky that is only a few days old have the same characteristics of whisky that may be several years old. And I understand that there will not be, after a period of time, any decomposi- tion or going back into the original state of young whisky. If that is so, and science seems to tell us that it is the case, there seems to be no reason why we should wait 4 years before we avail ourselves of the privilege of bottling whisky or other distilled spirits in bond. There is another provision that I should like to see added to any legislation of this character, and that is that it should not be necessary to bottle in bond whisky at 100- proof. That is f( very high proof, and we should do every- thing in our power to discourage the consumption of bever- ages at 100-proof. As a result of prohibition we have edu- cated the mass of drinkers to drink at 100-proof, because medicinal liquor was primarily that which was bottled in bond at 100-proof. Having educated the Nation to drink bottled-in-bond liquor at 100-proof, the demand will con- tinue for some time to come for 100-proof liquor. That is bad and most deleterious and should be changed. For that reason I believe they should be given the right to bottle in bond at 85 proof or 90 proof or at any proof between 85 and 100. While I do not have personal experience on the subject, I do know from my reading and from hearing others tell about it that in the old days most of the good whisky was consumed at proofs considerably under 100; that good blended whisky was usually consumed at about 85 or 90 proof. I wish we could get back to those days. I would like to see whisky conaxuned even at lower proofs than 89 because the more ardent the spirits the more dangerous the spirits are. Therefore, we should encourage in every way, by amending the Bottle in Bond Act and by other methods, the drinking of lower-powered whiskey and not the very high ardent spirits. Therefore, at a suitable time I shall urge upon the Congress that the Bottle in Bond Act be amended in two respects. namely, that there be permitted bottling in bond at 2 jrears of age, and that a lower proof than 100, namely, from^SS to 100. The CHAIRMAN. The time of the gentleman from New York [Mr. Cellkr] has expired. The pro forma amendment was withdrawn. The Clerk read as follows: Sec. 7. So mucb of section 613 of the Revenue Act of 1918 [U.S.C., sup. VI. title 26, sec. 1300 (a) (2)] as reads: " On each bottle or other container of champagne or sparkling wine, 12 cents on each one half pint or fraction thereof; " On each bottle or other container of artificially caroonated wine. 6 cents on each one half pint or fraction thereof; " On each bottle or other container of liqueurs, cordials, or Blml- lar compounds, by whatever name sold or offered for sale, contain- ing sweet wine fortified with grape brandy, 6 cents on each one half pint or fraction thereof." is amended to read as follows: " On each bottle or other container of champagne or sparkling wine. 5 cents on each one half pint or fraction thereof; " On each bottle or other container of artificially carbonated wine, 214 cents on each one half pint or fraction thereof; " On each bottle or other container of liqueurs, cordials, or similar compounds, by whatever name sold or offered for sale, containing sweet wine fortified with grap>e brandy. 2Vi cents on each one half pint or fraction thereof; "Any of the foregoing articles containing more than 24 percent of absolute alcohol by volume shall be classed as dlstUled spirits and shall be taxied accordingly." Mr. KNUTSON. Mr. Chairman, I offer an amendment, which I have sent to the desk. The Clerk read as follows: Amendment offered by Mr. KmrrsoN: On page 5. strike out all of lines 1, 2, and 3. and Insert In lieu thereof the following: " On each bottle or other container of champagne or sparkling wine, 5 cents on each one half pint or fraction thereof, when produced in the United States, and 42 Va cents on each one half pint or fraction thereof when imported into the I7nlted States." Mr. SAMUEL B. HILL. Mr. Chairman. I make the point of order against the amendment, on the ground that it deals in part with import duties, and it is therefore not germane to either this section or to any part of the bill as written. Mr. KNUTSON. Mr. Chairman, the gentleman from Washington knows better than to make a statement like that. The gentleman's attention was called to the fact in committee when this amendment was offered, that this is not an import tax, but that it is an internal-revenue tax. What I propose by this amendment is to increase the in- ternal-revenue tax on imported champagne from 5 cents to 42^2 cents per half pint. My sole object in doing this is to give comfort and aid to the American champagne industry. ■ITie CHAIRMAN (Mr. Lakham). The Chair is ready to rule Mr. TREADWAY. I am not sure that I care to be heard if the Chair is ready to rule. Mr. LEHLBACH. Of course, I do not know how the Chair is viewing the question, but It seems to me that all this amendment does is to take a class subject to taxation and divide it into two parts, and put a different tax on the different parts. That is clearly germane. The CHAIRMAN. The Chair is ready to rule. The sec- tion under consideration seeks to impose a certain tax upon champagnes and sparkling wines without reference to where they are produced. The amendment offered by the gentle- man from Minnesota proposes a vanring rate of tax, depend- ing upon where the champagnes and sparkling wines are produced. Recourse to the statute sought to be amended by the pending bill discloses the fact that existing law im- poses a tax upon such wines whether imported or domesti- cally produced. The Chair thinks that it is in order to amend the pending section by changing the amount of the tax sought to be imposed, by fixing a higher rate on those 150 CONGRESSIONAL lECORD— HOUSE produced in a foreign country than on those produced domestically. The Chair, therefore, overrules the point of order. The gentleman from Minnesota [Mr. Knutson] is recognized for 5 minutes. Mr. KNUTSON. Mr. Chairman, it may not be generally ki.own, but this bill reduces the internal-revenue tax on champagne and sparkling wine from 12 cents per half pint to 5 cents per half pint, llie amendment I have offered would increase by 37 ^ cents per half pint the internal- revenue tax on all imported champagnes. There are thousands of acres of land in this country that are peculiarly adapted to the growing of champagne grapes. The Members of this House yesterday heard the very inter- esting and informative discourse by the lady from Califor- nia [Mrs. Kahn] on the quality of American-made cham- pagne. Mr. Chairman. I think the time has come when we should make ourselves independent of the deadbeat na- tions of Europe. [Applause.] There are now awaiting im- portation into this country 175.000,000 gallons of champagne from Prance alone, and ours is the only country where there is a market for that champagne. Do we owe France any- thing? We sent the flower of our manhood over there in 1917 and 1918. We have let her have over $4,000,000,000, and when we ask her to repay she thumbs her nose at us and tells us to go to hell. Does she deserve any considera- tion at our hands? No. The best part of France is the cemeteries where the American boys are buried by the tens of thousands. I hope. Mr. Chairman, that this amendment will be adopt- ed, because it is just a case of simple Justice to the Ameri- can champagne producer, to agriculture, and at the same time it will show France what we think of her course in refiislng to honor her just obligations to this country. Mr. DOUQHTON of North Carolina. Mr. Chairman. I trust the amendment offered by the gentleman from Min- nesota [Mr. Kntttson] will not be adopted. We are all as anxious as we can be. consistently, to collect the debts owing us by foreign governments; but we must keep in mind the other things to be considered besides this matter of deal- ing with Prance as far as the collection of debts is concerned. If that were the only issue involved, which it is not, of course, we could argue It from that viewpoint. But suppose we do throw down this challenge to Prance that we want to embargo her sparkling wines and other articles and com- modities because, forsooth, she has not met her solemn obli- gations as honorably as we think she should, we being the judge. I fear that taking steps of this kind may get us into deeper water than we apprehend. According to the report of the Department of Commerce for the year 1932, we ex- ported to France $111,560,000 of American goods and im- ported from France only $44,738,000, making a balance of trade in our favor with France for that year, the last for which we have a report from the Department of Commerce, of $66,823,000. Now, if we draw this sword against Prance and take this step toward collecting the debt. Prance, of course, will re- taliate. She is just as able to get along without our exports as we are without her imports. I do not think any nation. in the full sense of the word, is entirely self-dependent] although we might claim to be. If I have a disagreement with a man over a debt he owes me and by the arrangement I am going to lose much more than I am going to gain by keeping up the controversy, what is the benefit in keeping it up? Are we to take the risk of losing exports to the amount of $111,000,000 in order to keep out imports of $44,000,000? Mr. KNUTSON. Mr. Chairman, will the gentleman yield? Mr. DOUOHTON of North Carolina. I yield. Mr. KNUTSON. How much do our tourists leave in France every year? Mr. DOUOHTON of North Carolina. I do not know; neither does the gentleman. Mr. KNUTSON. We know it runs into the hundreds of millions of dollars. January 5 Mr. DOUOHTON of North Carolina. That has nothing the world to do with the question before us. We are not lealins with tourists. I would have my friend to under- d. I am sure that we are all as anxious as we can be, con- stently and properly, to collect the debts owing us by for- ign governments; but this is not a matter upon which we ve information or upon which we are prepared to act in is bill. I think the gentleman from Minnesota knows and derstands this. It means only further complication of e situation, so far as our foreign relations are concerned. The President of the United States is just as anxious to llect every dollar of these debts as anyone; and, moreover, le is in a much better position than we are; be has more brmation than we have with respect to the best method collecting these debts. So why should we embarrass him, hy should we thrust this issue into the consideration of is bill and embarrass the President of the United States ^jho today is carrying as heavy a burden on his shoulders, a 3 heavy a strain on his brain as any man ever carried since t le foundation of the Republic? Not even George Washing- tm in setting up the Repubhc, not even Abraham Lincoln in the dark and trying days of the Civil War, not even \ roodrow Wilson during the turmoil of the great World War labored under the terrific strain our President is laboring u nder today. Taking this into consideration why should we, ss a matter of political expediency, with no fuller knowl- edge of this question than we have, take action that may accentuate his difficulties. I have discussed this matter with those high in authority i: 1 the executive departments and they fear the consequences cf such action by the Congress. [Applause.] [Here the gavel fell.] Mr. DOUOHTON of North Carolina. Mr. Chairman, I ask unanimous consent to proceed for 5 additional minutes. The CHAIRMAN. Is there objection to the request of the gentleman from North Carolina? There was no objection. Mr. BRITTEN' Mr. Chairman, will the gentleman yield? Mr. DOUOHTON of North Carolina. I yield. Mr. BRITTEN. TTie distinguished Chairman of the Ways a id Means Committee has just suggested to the House that ii the House takes independent action on this bill it might e nbarrass the President. I am wondering, and will ask the gentleman, does he think that because the House finally n (solves itself into its proper purpose and its proper place aid does take some independent action the President will b; embarrassed; or are we to be supinely led by the nose br the President for another year or 2 or 3 years without n aking our own decisions in the premises? Mr. DOUOHTON of North Carolina. That is just another pirtisan issue thrown in here. Mr. BRITTEN. It is not partisan at all. Mr. DOUOHTON of North CaroUna. That is all it is. Mr. BRITTEN. It is not partisan at all. I may say to the d stinguished gentleman from North Carolina. Mr. DOUOHTON of North Carolina. Of course, the gen- tleman from Illinois knows it has no place in this bill. He kiows. moreover, that this House is not in possession of the fiicts and information to intelligently deal with a matter .so fjT-reaching as this question. Mr. BRITTEN. WUl the gentleman yield further? Mr. DOUOHTON of North Carolina. I yield. Mr. BRITTEN. I do not care to inject partisanship into tids question at all. Mr. DOUOHTON of North Carolina. That is all it is. Mr. BRITTEN. But when the gentleman says that inde- p indent action by the House itself will be embarrassing to tZie President, what other inference can we take? Mr. DOUOHTON of North Carolina. I cannot sec any r< ason why it would not be embarrassing. Mr. BRITTEN. Then any independent action by tlie House would be embarrassing to the President. jMr. DOUOHTON of North Carolina. Not at all; the P-esldent of the United States is not set up that way. and tlicre can be no justification for this amendment. 4 p articles described In tills paragraph shall apply only with respect to the Importation of such articles. [Applause.] I submit this fact for the correction of the statement of my colleague that there never has been a tariff provision in an internal revenue act. Mr. McCORMACK. What my friend has said does not cause me to change my statement a bit. I said we had never before used the internal revenue laws for tariff purposes. Mr. TREADWAY. But it does impugn the truth of the statement. Mr. McCORMACK. The tax imposed under that provi- sion was imposed at the point of entry. This is a tax col- lected internally. That was an increased tariff duty in a revenue bill, and I opposed that also, collectable at the port of entry, and the additional tax imposed under this pro- poned amendment means that it will be collected internally throughout the country. One was a tariff provision in a revenue bill, and this is the use of internal revenue laws for tariff purposes. Both are bad, but there is a clear dis- tinction between them. Now, I maintain this is the first time in the history of the country that through the use of the internal revenue laws of this country, if this amendment prevails and becomes a part of the law, that the internal revenue law has been used for tariff purposes. January 5 I want to call my colleagues' attention to the fact that if this is successful, we are starting on another legislative journey which is hable to bring many injurious results. If we are going to use the internal revenue laws for tariff purposes on this product, why can it not be used on other things? Why can it not be used on every other raw or finished commodity produced or imported into the United States? We will simply be starting another vicious indirect tariff circle. I submit this is a tariff question, and the matter should be confined to the field of tariff. A Democratic-controlled House, no matter what our personal views may be with reference to there being an increased duty on champagne, should not adopt such an amendment. I am in sympathy with the objective sought by the amendment, outside of its political design, and would probably vote for it as a tariff measure, but the internal revenue laws should not be re- sorted to. and a Democratic-contrclled House should not permit it to be incorporated in our laws under the guise of an amendment to our internal revenue laws. [Applause.] Mr. BRITTEN. Mr. Chairman. I move to strike out the last two words and rise in support of the amendment. Let me say to my friends of the House, particularly to the new Members on the Democratic sicie of the House, please do not be coxifused by this palaver you have just heard about embarrassing the President. Mr. O'MALLEY. Will the gentleman yield? Mr. BRITTEN No; I have just started, why should I yield? [Laughter.] Mr. O'MALLEY. I am one of the new Members. Mr. BRITTEN. All right; I wUl give the gentleman a little advice. Do not be deceived by the suggestion that this is a tariff provision being written into a revenue act. Suppose it is. Is it in the interest of American industry? Is it in the interest of the American farmer or tlie American agricul- turalist? If it is a good amendment, ir ought to be adopted by the men on this side of the aisle. I think this will benefit those intei«sted in agriculture in California, Ohio. New York, and other grape-growing States, I say to you. my friends, that the champagne of this coun- try cannot compete in price with that produced in France. A few years ago when I was motoring through France with my sister and moth, I went into a winery and bought six quart bottles of Heidseck champagne for $6 — a dollar a bottle. We have heard a good deal about protecting the farmer; let us protect the grape growers of this country. The tax carried in the bill is being increased from 5 cents to 42*/2 cents by the amendment now pending — an increase on every so-called " quart bottle " of champagne of $1.20. I think the amendment ought to be adopted in the interest of the American producer. This is not a political issue; this is an American issue. I have not recently bought German champagne, but Germany makes excellent champagne. Belgium makes a good champagne, and Italy makes a very good champagne, and so does Chile. Tlie gentleman confuses the issue when he says that this amendment is directed against Prance. She can take care of herself by trickery and deceit. Talk about the Scotchman being tight, why he is a spendthrift compared with the aver- age Frenchman. [Laughter and applause.] A dishonest debtor will never pay us so long as we ignore her faults and assure her that repudiation will not impair the ardor of our friendship. Prance repeatedly sees fit to ignore her vast indebtedness to this country. She will not even speak to us of her defaults, nor will she give herself the painful remind- er that, she is a debtor with a Ijad record. By ignoring her obhgations she hopes to forget their existence. In this way. Prance reasons, she will reestablish her peace of mind and self-esteem. Our State Department has done little to force payment or to imcover the nakedness of her sha-.neless de- faults and brazen repudiations. On yesterday I called upon President Roosevelt to follow in the footsteps of Andrew Jackson and to deal with tliis piacticed and persistent de- faultor in the drastic manner she deserves. The amendment before the House does not go nearly far enough. It should 1934 CONGRESSIONAL RECORD—HOUSE 153 completely bar the importation not only of wines and brandies but of every other French product, if such a course appears necessary to bring France to realize that she has treated America scornfully, contemptuously, and falsely — the America which saved her from overpowering enemies and perserved her from destruction. The patriotic, self-respect- ing people of the United States unanimously desire honorable dealings with Prance, or no dealings at aU. Mr. O'CONNOR. Will the gentleman yield? Mr. BRITTEN. I yield. Mr. O'CONNOR. I appreciate the fact that the distin- guished athlete from Illinois is the greatest authority on champagne in this House. Does he mean to say that any- body in this country who produces the sparkling water which the gentleman enjoys is a farmer with overalls and every- thing? Mr. BRITTEN. Yes; but what does the gentleman mean by " overalls and everything "? When the gentleman from New York laid the cornerstone at Peoria, he was wringing wet [laughter], because he stood out in the rain when he laid that cornerstone. ITie gentleman from New York thought I meant wet of another kind. [Laughter.] Mr. O'CONNOR. If the gentleman from Illinois had been there, he would have heard me say to the distillers worse things than I ever said on the floor of the House. I only went there at the importunity of the gentleman's Republican colleague, who wept «n my shoulder and asked me to go out and save him as general manager. Mr. BRITTEN. If he wept on the gentleman's shoulder, he must have also been wet — from the rain. [Laughter.] I hope that the House will adopt the amendment. Mr. McGUGIN. Mr. Chairman, it seems to me that the issue presented in this amendment, offered by the gentleman from Minnesota [Mr. Knutson], is very simple. It does not seem to me to be a partisan issue at all. Let us strip off the mask and look at the facts involved. Here is what is back of that amendment, and we all know it. Prance is the prin- cipal importer into this country of champagne, and this amendment will be giving beneficial advantage to the Ameri- can grape producer in preference to the French grape pro- ducer. But that is a small part of it. Prance owes this country money and she will not pay it, and it is not within her heart to pay it until the last Frenchman knows that France cannot afford not to pay it. [Applause.] Why should the American Congress, especially Members from the agricultural sections, sit here today and worry about dis- criminating against Prance? Has she not laid embargoes against American farm products? What we are offering to do to champagne, so far as France is concerned, is mild compared with what Prance has done to American farm products. That is why the French farmer can get $1.50 per bushel for his wheat, while our farmers produce their wheat at a loss. Her markets are closed by virtual embargoes on our farm products. And now, when we ask for a $6 advan- tage for the American grape producer as against the French grape producer, the partisan issue is raised. Do you want to see France pay her debt? Do you Democrats want to uphold the hand of your President in his effort to collect the French debt? Then let the Atlantic cables carry the news tonight that the American House of Representatives today levied a special tax of $6 a gallon against imported champagne, and Prance will have a different view tomorrow morning in respect to paying her debts to the United States. This great body which represents the people, and who must appear before the people for reelection next November, can say today, " Prance, you pay or your champagne shall not come into the United States ", and Prance wiU pay, and that is language that Prance will understand. It is your op- portunity today, you on the Democratic side of this House, to do that which wiU lead to the payment of the French debt to this country, and it is your opportunity to show your resentment at the tariff discrimination that Prance has raised against American agricultural products. Mr. BRITTEN. The gentleman just expressed the thought to Prance, '* You pay or your champagne wilL" Mr. McGUGIN. Exactly. The CHAIRMAN. The time of the gentlemen from Kansas has expired. The question is on the amendment offered by the gentleman from Minnesota. The question was taken; and on a division (demanded by Mr. KKtTTsoM) there were— ayes 75, noes 136. So the amendment was rejected. The Clerk read as follows: 8k. B. (a) Section 608 of the Revenue Act of 1918, u amended (relating to the tax on malt Uquon) (UJS.C mip. VI, UUe 36. sec. 1330 (a) ]. ia amended by striking out " a tax of $6 " and In- serting In lieu thereof " a tax of $5." (b) Subsection (a) of section 1 of the act entlUed "An act to provide revenue by the taxation of certain n^wtfntffirkmtlnt llqudT. and for other purpoeee ". approved March 32. 19SS. U heraby repealed. Mr. PALMISANO. Mr. Chairman. I offer the following amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. PAUcUAiro: Page 5. Une 34, atrlke out everything after the word " of " and Inaert In lieu thereof Mr. PALMISANO. Mr. Chairman, this amendment is to cut out the $5 tax and to substitute a $2 tax for beer. As I said on the floor of the House yesterday, in the bill it would appear that the tax on beer has always been $6 a barrel. The truth is that the $6 tax was a tax only during the war, and that the tax on beer from 1862 until 1914 had always been $1 a barrel. The $5 tax, when we passed It in the special session, might have been justified because there were no breweries, or very few of them in the States, and ^ey would have taken advantage of the scarcity of beer in the breweries. But since the act legalizing beer was passed there are perhaps four times more breweries in operation today than at that time, and yet. notwithstanding there is more production, the tax has been reduced. For instance, in April, starting on the 7th. the revenue for April waa $8.269,(K)0. In May it increased to $11,(XM).000, in June to $12,000,000, in August to $15,000,000. whUe in November we received less revenue from it than we received in the 23 days in the month of April. In November the revenue received on beer was $8,040,943, while in the 23 days of April the revenue was $8,269,000, or $229,000 more in April than in November. My contention is that if we reduce the tax to $2 we will produce more work and the breweries will be able to continue in operation and you will be able to give a man a decent glass of beer for a nickel. You will also help the farmers. Congress said that beer is nonintoxicating. and yet you have taxed it 400 percent more than the ordi- nary tax. We want temperance, and here today the com- mittee has offered to increase the tax on hard liquor only 80 percent over what it was before prohibition. If the tax on whisky of $2 is a good tax. in all fairness let us tax the nonintoxicating beverage no greater amount in com- parison to the tax that was levied before the war. It was $1.10 on whisky before the war and $1 a barrel on beer. Let us make it $2 a barrel on beer with a $2 tax on whisky. Mr. COOPER of Tennessee. Mr. Chairman, in reply to the distinguished gentleman from Maryland [Mr. Palmz- SANo], the Ways and Means Committee gave very careful and thorough consideration to this quration of a proper tax on beer. Witness^ appeared and urged that there should not be the difference between beer of different alcoholic contents, and urged that all of it should be placed upon the same status. That is the purpose we have sought to accomplish here. Now with reference to the remarks made by the gentleman as to the cost or price of beer to the consumer, those ctf us who were present and heard the representatives of the* brewers themselves when they appeared before the commit- tee when the beer biU was under consideration will recall that they told us if the tax was placed at $5 per barrri, as recommended and agreed upon by them, the consumer of the coimtry would receive a substantial size glass of beer for 5 cents. Some of the same gentlemen who appeared before the committee at that time appeared again this time, and we were interested to know why their assurance to us on the former occasion had not been carried out We bad a gentle- 154 CONGRESSIONAL RECORD— HOUSE January 5 man appear there from the State of New Jeraey, who testi- fied In behalf of the National ReUil Beer and Uquor Association. He testified that the cost of beer to the tailer was $15 a barrel, and that was based upon $S a barrel tax for the Federal Government and $1 a barrd tax for State. He testified that he was retailing It at 10 cents glass. With 496 glasses per barrel, that would amount $49.60. and $15 cost for a barrel of beer to him would lea $34.60. Other evidence revealed that prior to prohibitii Budwelser, which I understand was considered to be a godd quality of preprohibition beer, sold In St. Louis at a cost < if about $9 per barrel, with a tax of $6. leaving about $3 fdr the cost of the beer. With the same tax, and the flguris given by these men representing the brewers' interests, n e see there is $9 to the brewer for a barrel of beer, or an ii i- crease in preprohibition price of about 300 percent. One witness appearing in the interest of the brewers, wl o had appeared before, came before theh committee and I asked him the question, why the promises given us. wlu n the beer bill was under consideration had not been kejt. I asked him, as will be found on page 241 of the hearing s, and he said he was unable to explain it, except that lie hoped when competition set in, and that when the industiy was regulated in the future, they might be able to give a 5-cent glass of beer, and stated that the 5-cent glass of bet sr was on the way. . Therefore it simply ccmveys the very clear and deflnie conclusion that it is ZK>t in the tax; the tax is not the que >- Uon that controls the price of the beer to the consmncr. It is controlled by the brewers themselves. We fixed this tax in the beer biU at $5 per barrel, the very amount thi A they then asked, and, upon their assurance, they told is they would give the public a 5-cent glass of beer. Therefore it is not a question of the tax as to the price which the con- sumer pays, but it is the amount of profit that the brewiir requires of the retailer. The CHAIRMAN. The time of the gentleman from Tei - nessee (Mr. CoopkiJ has expired. Mr. O'CXDNNOR. Mr. Chairman, I rise in opposition lo the amendment. Mi. Chairman, in the discussion of the beer bin I adv(i- cated a tax of $7.50 a barrel, and I did so because tie brewers who communicated with our committees of tie " wet " group, and our subcMnmittees when we were coi i- sidering the '* O'Connor-Hull " beer bill, told us that with a tax of $7.50 a barrel they could profitably sell a barrel of beer at $11. They had sold beer at $5 before prohibitioi. with a $1 tax on it. Iliey told us that with the decreased cost of production and labor they could sell a barrel of be ir for $11, with a tax of $7.50. When they persuaded tlie Committee on Ways and Means to put a $5 tax on the beer, they also told that ctMnmittee they would sell a barrel (if beer for $11. I stood on this fioor and I argued for a highi sr tax. as I have argued with reference to the whisky tac. and I said, "No barrel of beer will ever come out of a brewery for which they will not charge $15 or $16.'* The gentleman from Maryland [Mr. Palxzsaito], enthus - astlc to get his 5-cent glass of beer for the people, and tl e gentleman from Missouri [Mr. Cochrak] and other enthiia- astlc wets ridiculed my predictions. They said. *' Where (io you get your information that the brewers will charge $ or $16 a barrel? " Well, what has happened since April proves that I w^s right, whether I had the Information or not. Not only h&^ e they charged $15 or $16 a barrel, but they have charged is high as $60 a baorel by the case. Budwelser and Schli z have charged $4 a case, and there are about 15 cases Inja barrel, which makes $60 a barrel, as compared with $15 barrel by the case before pndiibition. Bo today the consumer, I say to the gentleman from Mari land [Mr. PalxxsanoI. never got his 5-cent glass of beer, and he never would get his S-cent glass of beer If there wi s so tax on beer, or if the tax were any amount you miglt Imagine. Today the price of beer would still be 10 cents ft r a lO-ofonee glass if the tax was $7.50 a barrel, or If tt wae noihhic. In the interim, however, the Qovemment his thrown away $100,000,000 in income, with no benefit to the consumer and no benefit to the retailer. The only benefit has enured to the brewers. What great exalted position do these brewers, who were so patriotic during the World War that most of them were interned or under governmental surveillance, hold in the Government of the United States that they dare come here and try to further extort from the American people, when today they are getting eight or nine times as much as they ever got in profits before prohibition? Reduce this tax? Why, it should be increased. You never got your 5-cent glass of beer. You never will while they can maintain these exorbitant prices. It is the exorbitant price that has kept the bootlegger in the beer business. It is the high prices, not the high taxes. If I have failed to convince the House on the whisky tax. perhaps next year I may be able to come back to you and to recall to you that what happened as to beer has by that time happened to whisky; that even if you make the tax low, the consuming public will still pay the same price to these rapacious, unpatriotic, legitimate citizens, and the Government will lose the revenue. So I hope this amendment, which has no substance, based on the experience of the past 6 or 7 months, will be over- whelmingly defeated. The CHAIRMAN. The time of the gentleman from New York [Mr. O'Conmor] has expired. Mr. MEAD. Mr. Chairman, the gentleman from New York [Mr. O'Connor] is both right and wrong in the con- tention he makes relative to the position taken by the hquor industry and that taken by the brewing industry. The distinguished gentleman from Tennessee [Mr. Coopcr], a member of the coounittee, who preceded him. also was right in his estimate of the tax on beer at the time 3.2 beer was legalized, but incorrect now because of the accumulated taxes we have imposed upon the industry since that time. May I suggest to the House that when we take Into con- sideration the accumulated tax which must be paid by the brewer and reflected in the price of a barrel of beer it amounts not to $5 or $6, but actually to $9 or $10. The argiiment I am making brings the question of taxation up to date. When you consider the fact that at the time we legalized beer we were without many breweries in the United States and the demand more than overwhelmed the supply, surely at that time the few brewers who resumed business could charge an exorbitant price for their beer, and they probably did in some cases. But today there is more beer in the United States than is necessary to meet the demand. There is real competition in the brewery busi- ness: a number of new licenses are issued every day and real competition exists which is reducing the price of beer. Therefore, there is no analogy between the hquor business of today and the beer business of today, as sug- gested by my colleague from New York. In one instance the supply cannot cope with the demand, and in the other case, that of beer, the supply overwhelms the demand- Prices of beer are coming down while liquor prices are very high. What are the taxes reflected in a barrel of beer? It must be remembered we adopted a tax on power, a process- ing tax on grains required in the manufacture of beer; and in addition to that there are Federal, State, and local permit taxes. Also there are license taxes to sell to the wholesale and retail trade. Furthermore, there is a gas tax, an auto- mobile tax, corporation, and higher income taxes. On top of an this there is the $5 per barrel tax on beer; and, ol course, the tax on real estate, so altogether we are taxing beer at $9 or $10. This being the case, how do you expect the breweries of the United States to sell a glass of beer at 5 cents? The exorbitant tax makes it impossible? Remem- ber, also, the added costs necessary as a result of the adop- tion of the breweries code — a model code. Here is what I fear you are doing: You are driving the lit- tle brewer out of business; you are making it possible for only the big brewer to survive; you are making it possible for an Industry to become closely knitted together by driving out small manufacturers Just as is the case now so far as the producti(m of liquor is concerned. But above and be- 1934 CONGRESSIONAL RECORD— HOUSE 155 yond all this you are demiving the men who work in the hulls of oiir ships, the tired women who work all day at the looms, the men who climb out of our mines and blast fur- naces of the right and opportunity of enjoying a wholesome, healthful glass of beer which they have a right to enjoy. You are making it easy for the bootlegger to continue. You are making temperance more difficult. Mr. Chairman, while I dislike to take issue with our Ways and Means Committee, knowing they have given this measure real sincere considera- tion, I ask in all fairness that consideration be given to the fact that there is real competition in the brewery business, and a high tax means higher priced beer. Above all, we can help promote temperance in the United States by giving all the workers of this country a real glass of wholesome, healthful beer. I believe it was Thomas Jefferson who said we ought to make easily accessible the mild, nonintoxicating beverages so as to promote real temperance. The best way to do this is for the Federal Government to set a splendid example for the State, county, and local governments to fol- low by imposing a moderate tax. U an exorbitant tax is imposed an example will be set which may be followed all the way down the line. [Applause.] [Here the gavel fell.] Mr. HOEPPEL. Mr. Chairman. I move to strike out the last two words. Mr. DOUGHTON of North Carolina. Mr. Chairman, will the gentleman yield to permit a unanimous -consent request? Mr. Chairman. I ask unanimous consent that all debate on this amendment and on the section close in 5 minutes. The CHAIRMAN, Is there objection to the request of the gentleman from North Carolina? There was no objection. Mr. HOEPPEL. Mr. Chairman, this bill proposes an in- direct prohibition law. Heretofore we had prohibition by enactment. Now we are proposing prohibition by taxation, nothing else, I agree with the statement made by the preceding speaker that the workingman, the common man, the man who under tho N.R.A. receives an average of about 40 cents an hour or $14 a week is unable to pay 10 cents for a glass of beer. I had as my campaign slogan "Lower taxes, jobs, and beer." I am committed to beer, I wish there were no tax on beer other than a mere regulatory tax. I find that my slogan has been swept into the discard. There is no chance for relief from high taxation as long as we continue to issue tax-exempt bonds. True, we are putting men to work under the C.W.A. and otherwise, but we are doing so only by mortgaging the life and future of unborn generations. To increase the taxation on beer is wrong. It has been stated that we require it for revenue. Prom my viewpoint, such an insignificant and small amount of revenue as may be derived from beer compared with the billions of dollars we are spending and propose to spend on relief and unem- ployment is negligible. Had the people who voted to repeal the Prohibition Law known we proposed to levy a tax of this character they would have maintained the Prohibition Law, which would be preferable to weighting down the American people now with inordinate taxes. The CHAIRMAN. The question is on the amendment of the gentleman from Maryland. The amendment was rejected. Mr. O'MALLEY. Mr. Chairman, I offer an amendment The Clerk read as follows: Amendment offered by Mr. CMallst: Page 5. line 24. after the word " of ", strike out " $5 " and Insert In Ueu thereof " $3." Mr. O'MALLEY. Mr. Chairman Mr. DOUGHTON of North Carolina. Mr, Chairman, all debate on this section has been closed. Mr. O'MALLEY. Then. Mr. Chairman, I ask unanimous consent to proceed for 5 minutes. The CHAIRMAN. Is there objection to the request of the gentleman from Wisconsin? There was no objection. Mr. O'MALLEY. Mr. Chairman. I offer this amendment for a $3 tax upon beer in the hope of reaching a compromise on this question. If I wen a dry. the best thing I would want to do as ft mfttter of ftrategy would be to try to load onto wina and beer a tax that if so high thftt its consumption would b9 reduced and at the same time hold whisky or Lard liquor at a point where it could come to the consumer at as low a price as possible. That would be good dry strategy. I supported repeal in the hope that we would try to dls> courage the increased consumption of hard liquor. I find on the Republican side that there is a gentleman who argues for a lower tax in the hope we may increase the consumption of whisky. If I had known or expected that repeal was to bring about an increased consumption of whisky. I might not have voted as I did. I think the workingman's drink — beer — that does not intoxicate anybody and which this Con- gress said was not intoxicating, should not be loaded with 400 percent more tax than we are loading on whisky today. I think we ought to be fair in this matter and the tax which we are raising should be «iual in proportion on all oC the beverages that come to us after repeal. We have increased the tax on whisky about 80 percent. We reduced it on champagne, the rich man's drink, the millionaire's drink. Someone told me that it was an in- valid's drink. I have seen some men become invalids only after they drank it. We are worried about American cham- pagne. Let me say to you that beer emplosrs more people per gallon than champagne ever did. It helps the fanner more. I particularly enjoyed the advice of the gentleman from Illinois to the new Members that we ought to appre- ciate his tears for the champagne drinkers. I think the Government can divest this matter of a beer tax entirely from the revenue and budget features. If we place a tax of $3 on beer we will get just as much revenue as we wiU out of a $5 tax. When the breweries of my State started into operation they began with a shift of workers 24 hoiurs each day. Today, because of the high price of beer, thef are down to the point where they are laying men off and operating only 7 or 8 hours a day. Mr. O'CONNOR. Will the gentleman yield? Mr. O'MALLEY. Yes. Mr. O'CONNOR. Does the gentleman really believe that his breweries will charge less for a barrel of beer with a $S tax than they are charging now with a $5 tax? If I believed that were so I would be with him, but I know it Is not so. Mr. O'MALLEY. I do not know whether they would or not, but we have the NJRA. and the Consumers' Council and we have the Federal Trade Commission to bring the prices down if they are overcharging the consumer. We ought to take the excuse away from them that they must charge this price because the Federal Government is getting $5, the State government $1, and the other taxes bring it up to nearly $10. Mr. COOPER of Tennessee. Will the gentleman yield? Mr. O'MALLEY. Yes. Mr. COOPER of Tennessee. The evidence before the committee shows that in the gentleman's city. Milwaukee, I believe, beer is selling to the consumer, the large-sized glasses, at 5 cents. Mr. O'MALLEY. That is probably where some poor fellow was trying to get a little business in order to keep himself in operation, or some tavemkeeper is trying to outdo tne other man who operates at a loss across the street from him. But there is not a man in my city that ean sell bea at 5 cents a glass and keep out of the hands of a receiver for a year at present prices. Mr. HKATJ!Y. Will the gentleman yield? Mr. O'MALLEY. Yes. Mr. HEALEY. Is it not a fact that the Ingredients used in the manufacture of beer have gone up 50 percent since last April? Mr. O'MALLEY. Yes; and because of tax processinf and other kinds. Mr, O'CONNOR. Wh;it does the gentleman think it coeta to make a barrel of beer? Mr. O'MALLEY. I do not know what it costs to make ft barrel of beer, but I know that small breweries are spending now, to turn out a barrel of beer, about $2.60. 156 CONGRESSIONAL RECORD— HOUSE January 5 1934 CONGRESSIONAL RECORD— HOUSE 157 Mr. O'CONNOR. If they are. they are pftying at leist $1.40 more than is the usual rate. I understand it cats about 60 cents to turn out a barrel of beer. Mr. O'MALLEY. Maybe those are breweries that do rot chisel on the N.R.A. and the process tax and pay their eib- ployees a good wage. I Mr. KNUTSON. Will the gentleman from Wisconsin yield? Mr. O'MALLEY. Yes. I yield to the gentleman. Mr. KNUTSON. I am in thorough ssrmpathy with wHat the gentleman says about the NJR.A. and about the proc( iss taLX. The process tax has increased the price of flour $1.35 a barrel to the consumer. It has increased the price of mill feed to the dairymen by 40 to 50 percent and the price of butter is lower today than it ever has been at this tifie of the year. Mr. OTkiALLEY. I agree with the gentlonan. I co^e from Wisconsin, where we make lots of butter. Mr. KNUTSON. Yes. Mr. O'MALLEY. We can divest this question from Ithe matter of raising revenue and if we vote for a $3 tax nc wiU be going on record in favor of a 5-cent glass of b(ier for the workers and real temperance for the Nation. The CHAIRMAN. The time of the gentleman has ex- pired. The question is on the adoption of the amencmu nt offered by the gentleman from Wisconsin [Mr. O'Mau.cjI The amendment was rejected. Mr. CANNON of Wisconsin. Mr. Chairman. I offer km amendment. The Clerk read as follows: Amendment offered by Mr. Cannok of Wisconsin : Page 5, line |24, after tbe word ~ of ", sUlke out " $5 " and Insert In Ueu tber^ - $3.35." The amendment was rejected. Mr. MEAD. Mr. Chairman. I offer an amendment wh^h Is at the Clerk's desk. The Clerk read as follows: Amendment offered by Mr. Mead: Page 5. line 24, strike c^ut •" $5 " and Insert In lieu thereof ' »4." The amendment was rejected. The Clerk read as follows: Sec. 12. This act shall take effect on the day following ^ta enactment. Mi. Chairman, Mr. DOUGHTON of North Carolina, offer a committee amendment. The Clerk read as follows: Page 8. after line 6. Insert the foUowtog: "Tmji n "Sac. 301. No person shall -(except as provided In section 2d2) transpcnt, possess, buy, sell, or transfer any distilled spirits, unl tsB the Immediate container thereof has affixed thereto a stamp < le- notlng the quantity of distilled spirits contained therein a ad evidencing payment of all internal-revenue taxes imposed on s^ch ■pints. The provisions of this title whmU. not apply to— "(a) Distilled spirits placed In a container for immediate coxey Drewry Driver Duffey Duncan. Mo. Dunn Durgan. Ind. Edmiston E'.e.;bogen Ell7ev. Miss. Paddis Parley Periiandez P"it2c:lblxin3 F.tzpalrlck P'annagan Fletcher Fterd Frey PuUer Fulmer OambrUl Gavagan Glffo-d GUlesple Gillette Glover Goidsborough Goss Granfleld Gray Green way Gregory Griswold Haines Hamilton Hancock. N.Y. Hancock. N.C. Harlan Hart Harter Hastings Healey Henney Hlgglns HUdebrandt Hill. .Ma. Hill. Knute HU!, Samuel B. Hoidale Howard Huddleston Imhoff Jacobsen Jeffers Jenckes. Ind. Johnson. Okla. Johnson. Tex. Johnson. W.Va. Jones Kee Keller Kennedy, Kennedy. Kenney Kerr Kleberg Kioeb Knlffln Kocialkowskl Kopplemann Kramer Kvale Lambeth Lanuieck , Md. NY. Bogers. Mass. Seger Shoemaker Simpson Sinclair Snell Stalker Stokes Strong. Pa. Swick Taber Taylor. Tenn. Thurston Traeger Tread way Turpln Welch Whitley Wigglesworth Wlthrow Wolcott Wolfenden Wolverton Woodruff Lanham Lanzctta Larrabee Lea, Calif. Lehr Lesinskl Lewis, Colo. Lindsay Lloyd Lozler McCarthy McCUntic McCormack McDuffle McFarlane McG.ath McKcown McMUlan McReynolds McSwala Maloney. Conn. Maloney, La. Man&field Martin, Colo. Martin, Oreg. May Mead Meeks Merr.tt Miller MlUlgan Mitchell Montague Montet Moran Morehead Mott Murdock Musselwhlte Ne&btt Norton O'Brien O'Connell O'Connor O-Malley Oliver, N.T. Owen Palmisano Parker Parks January 5 Parsons Rviffln Stubbfl Wadsworth Patman Sabath Studley Wallgren Peterson Sadowskl SullivHn Walter PettengUl Sanders Sumners, Tex. Warren Peyser S<-haefer Sutphla Wearln Pierce S-huetz Swank Woaver Poik Schulte Tarver Weldtman Prall Scrvigham Terrell, Tex. Werner Ramsay Sears Terry. Ark. We.st. Ohio Rarnspeck Socrest Thorn West. Tex. Randolph Shallcnberger Thoma.son, R. E. White Rankin -' Shannon Thompson, C. W Whlttlngton Ray burn Slrovlch Thompson, 111. Wilcox Reed. NY. Stsson Tlnkham Win ford Rellly Smith. Va. Tobey Williams Richards Smith. Wash. Truax Wilson Richardson Smith. W.Va. Turner Wood. Ga. Robertson Snyder Umstrad Wood. Mo. Robinson Somers. N.Y. Underwood Young Rogers. N.H. Spence Utterback Zioncheck Rogers, Okla. Steagall Vinson. Ga. Rudd Strong, Tex. Vinson. Ky. ANSWER?:n " PRESENT "— McGugln NOT VOTING — 41 Arnold aark. N C. He.se Reld. ni. Ayres, Kans. Collins, Miss. Hughes Romjue Bacharach Coming Kelly. Dl. Sandlin Bacon De Priest Lee. Mo. Sweeney Beam DeRouen Lewis. Md. Taylor. Colo. Brown, Mich. Douglass Ludlow Taylor. S.C. Buchanan Foulkes Monaghan. Mont Waldron Burke. Calif. Cannon. Mo. Gasque Green Moynihan. 111. Oliver, Ala. Woodrunx^ Carley. N. Y. Greenwood Pou Claiborne Griffin Reece So the motion to recommit was rejected. The Clerk announced the following pairs: On this vote: Mr. Bacharach (tor) with Mr. Pou (against). Mr. McGugln (for) with Mr. Ayres of Kansas (against). General pairs: Mr. Buchanan with Mr. Bacon. Mr. Sandlin with Mr. Hess. Mr. Oliver of -Mabama with Mr. Reld of Illinois. Mr. Ludlow with Mr. Waldron. Mr. Taylor of Colorado with Mr. Moynihan of nilnols Mr. Claiborne with Mr. De Priest. Mr. Arnold with Mr. Reece. Mr. Woodrum with Mr. Brown of Michigan. Mr. Cannon of Missouri with Mr. Bxuke of California. Mr. Coming with Mr. Hughes. Mr. Beam with Mr. Monaghan of Montana. Mr. Greenwood with Mr. Carley. Mr. Douglass with Mr. Lee of Missouri. Mr. Collins of Mississippi with Mr. Foulkes. Mr. Sweeney with Mr Kelly of Illlnots. Mr. DeRouen with Mr. Lewis of Maryland. Mr. Taylor of South Carolina with Mr. Griffin. Mr. Gasque with Mr. Romjue. Mr. Clark of North Carolina with Mr. Green. Mr. McGUGIN. Mr. Speaker, my colleague. Mr. Ayres of Kansas, is absent. I voted "yea." I am paired with Mr. Ayres. If he were present, he would vote '" nay." I withdraw my vote of " yea " and answer " present." The SPEAKER. The genUeman will be recorded as present. The result of the vote was announced as above recorded. The SPEAKER. The question now is on the passage of the bill. Mr. DOUGHTON of North Carolina. Mr. Speaker, on that I demand the yeas and nays. Tlie yeas and nays were ordered. The question was taken; and there were— yeas 388. nays 5 answered " present " 1, not voting 36, as follows: Abemetliy Adair Adams Allgood Andrew. Mass. Andrews, N.Y. Arens Arnold Auf der Helde Ayers, Mont. Ayres. Kans. Bailey Bakewell Bankhead Beck Beedy (Ron No. 76] YEAS — 388 I Belter Berlin Biermann Black Blanchard Bland B'.anton Bloom Boehiie Boileau Boland Bolton Boylan Brennan Britten Brooks Brown. Ga. Brown. Ky. Browning Brunner Buchanan Buck Buckbee Bulwlnkle Burch Burke. Nebr. Burnham Busby Byrns Cady Caldwell Cannon. Mo. Cannon, Wis. Garden. Ky. Carmlchael Carpenter, Kans. Carpenter. Nebr. Carter, Calif. Carter. Wyo. Cartwright Cary Ca.'tellow Cavlcchla Celler Chapman Chase Chavez Chrlbtianson 1 1934 Church Clarke. NY. Cochran Mo. Cochran. Pa. Coffin Colden Cole Collins. Calif, Colmer Condon Connery Connolly Cooper. Ohio Cooper. Tenn. Cox Cravens Crosby Cross. Tex. Grosser, Ohio Crowe Crowther Crump Culkln Cullen Cummings Darden Darrow Dear Deen Delaney Dickinson Dicksteln Dies Dlngel! Dirksen Disney Dltter Dobbins Dockweiler Dondero Doughton. N. C. Doutrlch. Pa. Doxey Drewry Driver Duffey Duncan. Mo. Dunn Durgan, Ind. Eagle Eaton Edmlston Elcher Eilenbccen Ellzpy. MNs. Eltse. Caiif. Englebrigbt Evans Paddis Farley Fernandez Fleshlier Fl.«h Fitzglbbons F'annasan Fletcher Pocht Ford Fobs Prear Frey Puller Fulmer Gambrill Gavagan Gtfford Gilchrist Gillespie Gillette Glover Goidsborough Allen Brumm Bacharach Bacon Beam Brown. Mich. Burke. Calif Carley. NY. Claiborne Clark. N C. Collins. Miss. Goodwin Goss Granfield Gray Grcenway Gregory Griswold Guyer Haines Hamilton Hancock. N C. Hancock, N.Y. Harlan Hart Harter Hartley Hastings Healey Henney Hlgglns Hildebrandt Hill. A'a. Hill. Knute Hill. Samuel B. Hoidale Holilster Holmes Hooper Hope Howard Huddleston Imhoff Jacobsen James Jeffers Jenckes, Ind. Jenkins, Ohio Johnson. Minn. Johnson, Okla. John.son, Tex. Johnson. W.Va. Jones Kahn Kee Keller Kelly, Pa. Kennedy. Md. Kennedy, N.Y. Kenney Kerr Kinzer Kleberg Kloeb Knlffln Kocialkowskl Kopplemann Kramer Kurtz Kvale Lambertscn Lambeth Lamneck Lanham Lanzetta Larrabee Lea. Calif. Lee. Mo. Lehlbach Lehr Lemke Lewis, Colo. Lindsay Lloyd Lozler Luce Lundeen McCarthy McCllntic MrCormack McDuffle McFarlane CONGRESSIONAL RECORD— HOUSE 159 McGrath McGugln McKeown McLean McLeod McMillan McReynolds McSv/aln Maloney. Conn. Maloney, La. Man.sfleld Mapes Marl.'ind Marshall Martin, Colo. Martin. Mass. Martin, Oreg. May Moad Meeks Merrltt Millard Miller Milligan Mitchell Montague Montet Moran Morehead Mott Muidowney Murdock Musseiwhite Nesbit Norton OBrlen O'Connell O'Connor O'Malley Oliver, N.Y. Owen Palmisano Parker Parks Parsons Patman Peavey Perkins Peterson PettengUl Peyser Pierce Polk Powers Prall Ramsay Ramspeck Randolph Rankin Ransley Ray burn Reece Reed, N.Y, Rellly Rich Richards Richardson Robertson Robinson Rogers, Mass. Roger."". N H. Rogers, Okla. Rudd Ruffln Sabath Sanders Sandlin Schaefer Schuetz Schulte Scrugham NAYS— 5 Edmonds Hoeppel ANSWERED "PRESENT "—1 Knutson NOT VOTING— 36 Corning De Priest DeRouen Douglass DoweU Fltzpatrick Foulkes Gasque Green Greenwood Griffin Hess Hughes Kelly. 111. Leslnski Lewis. Md. Ludlow Monaghan, Mont. Sears Secrest Seger Shailenberger Shannon Shoemaker Sinclair Slrovlch Sisson Smith, Va. Smith, Wash. Smith. W.Va. Snell Snyder Somers, N.Y. Spence Stalker Steagall Stokes Strong, Pa. Strong. Tex. Stutabs Studley Sullivan Sumners. Tex. Sutphln Swank Sweeney Swick Taber Tarver Taylor. Colo. Taylor, Tenn. Terrell, Tex. Terry. Ark. Thom Thomason R E. Thompson, C. W. Thompson, 111, Tiukham Tobey Traeger Tread v/ay Truax Turner Turpln Umstead Undtrwood Utterback Vinson, Ga. Vinson, Ky. Wadsworth Waldron Wallgren Walter Warren Wearln Weaver Weideman Welch Werner West. Ohio West. Tex. White Whitley Whlttington Wigglesworth Wilcox WiUford Williams Wilson Wlthrow Wolcott Wolfenden Wolverton Wood Oa. Wood. Mo. Woodruff Woodrum Young Zioncheck McFadden Moynihan, m. Oliver, Ala. Pou Reld, 111. Romjue Sadowskl Simp.sou Taylor. S.C. Thurston So the bill was passed. The Clerk announced the following pairs: Additional general pairs: Mr. Pou with Mr. Bacharach. Mr. Oliver of Alabama with Mr. Reld of niinola. Mr. Collins of Mississippi with Mr. DoweU. Mr. Corning with Mr. Bacon. Mr. Greenwood with Mr. Hess. Mr. Ludlow with Mr. Moynihan of nUnoUi. Mr. Douglass with Mr. Simpson. Mr. Pitzpatrick with Mr. Thurston. Mr. Claiborne with Mr. De Priest. Mr Beam with Mr. Foulkes. Mr. Romjue with Mr. Carley of New York. Mr. Taylor of South Carolina with Mr. Hughes. Mr. DeRouen with Mr. Kelly of K'.lnols. Mr. Clark of North Carolina with Mr. Monaghan of Montana. Mr. Gasque with Mr. Brown of Michigan. Mr. Green with Mr. Burke of California. Mr. Griffin with Mr. Lewis of Maryland. Mr. Leslnski with Mr. Sadowskl. Mr. O'CONNOR. Mr. Speaker, I have been asked to an- nounce that the gentleman from .Massachusetts. Mr. Doug- lass, is confined to the hospital. If present, he would vote " nay " on the motion to recommit and " aye " on the passage of the bill. Mr. BYRNS. Mr. Speaker, I ask unanimous consent that the Clerk may read two short telegrams. The SPEAKER. Without objection, it is so ordered. There was no objection. The Clerk read as follows: Hon. Joseph Byens, Majority Leader, House of Representatives: Imminent danger of death In family will keep me away for few days. Please pair me to vote with President and administration In every instance. James Hughes, Eighth Wisconsin. Hon. Joe Byrns, House of Representatit^s. Detained at home on account of Illness. Will probably arrive Washington first of week. Please have me excused. R. A. Green, Member of Congress. Mr. SABATH. Mr. Speaker, I have just been informed that due to illness my colleagues, Kelly and Beam, of Illinois, are unfortunately absent. If they had been present, they wo»ld have voted " aye " on the bill. Mr. CULLEN. Mr. Speaker, in that connection I wish to announce that the gentleman from New York [Mr. Frrz- PATRicK] was present and voted against the motion to re- commit, and was called away. If present now, he would vote " aye " on the final passage of the bill. The result of the vote was announced as above recorded. ADJOURNMENT OVES Mr. BYRNS. Mr. Speaker, I ask unanimous consent that when the House adjourns today it adjourn to meet on Mon- day next. The SPEAKER. Is there objection to the request of the gentleman from Tennessee? Mr. SNELL. Will the gentleman yield for a question? Mr. BYRNS. Certainly. Mr. SNELL. Does the gentleman expect that an appro- priation bill will be ready for consideration on Monday? Mr. BYRNS. No: I do not. I am informed there is a possibility that the District Committee may have its District liquor control bill ready. If that Is the case. I understand the chairman of the committee expects to call up that bilL Otherwise there is nothing else on the calendar. The SPEAKER. Is there objection to the request of the gentleman from Tennessee [Mr. Byrns] ? There was no objection. EXTENSION OF REMARKS H.R. 6131 Mr. DOUGHTON of North Carolina. Mr. Speaker, I ask imanimous consent that all Members have 5 legislative days in which to extend their own remarks in the Record on the liquor tax bill. The SPEAKER. Is there objection to the request of the gentleman from North Carolina? There was no objection. Mr. EDMONDS. Mr. Speaker, under leave to extend my remarks in the Record. I desire to explain my opposition to H.R. 6131, a bill to raise revenue by taxing certain intoxicat- ing liquors, and for other purposes. I have made a careful study of the bill, particularly as to the measure of taxation necessary in it to secure a fair re- turn to the Government and at the same time siire oblitera* 150 CONGRESSIONi^ L RECORD— HOUSE January 5 tion of the bootlegger, or other iUegal vendors of tntoxicatpg liquors, for all time in the future. In making my investigation I have not only questioned the distiller but also several parties whom I know had knowledge of the bootlegger s art and artifices, and the only conclusion I could arrive at from both sources was that a Government tax of $2 upon distilled spirits diverted for beverage pur- poses, plus the $1 tax in my State of Pennsylvania, woild only have the effect of reducing legitimate production apid increase the amoimt of illegitimate liquor sold. It were better that the tax in the bill be $1, and in all probability return to the Government would be greater. It must not be forgotten that the illegitimate vendor now the opportunity to produce his supplies without inter- ference and can easily produce his product by cutting, wi out any expensive machinery or much effort, and certa a margin of $3 per gallon will attract many purchasers his product, as the question of quality will not be any lonker a deterrent to its use. For this reason I am opposed to the measure, feeling c< m- fident that it will not be far in the future when my preac- tions will be realized and this body will be forced either] to again enter into an extravagant campaign against th^se lawbreakers or to reduce the tax to a basis which will prevent them from operating. The question of quality, which has proven a deterrent in promoting the use of the illegitimate product in the ptst, will not apply to these operators, who will produce their supplies by cutting. Mr. WELCH. Mr. Speaker, prior to prohibition Cj li- fomia. Ohio, and New York were the principal wine-prod ic- ing States of this country. The records of the Department of Commerce show that grapes are produced in all but fiur of the States of the Union. Before prohibition Califorixia produced approximately 45.000.000 gallons of wine annua ly. Under the eighteenth amendment and the Volstead i ict came the rapid disintegration and practical destruction of the great wine industry of California and of the other wu re- producing States, which carried with it not only the destn ic- tion of the Nation's wine industry, but also very materia lly affected the greatest elements of the country — agriculture and commerce. In order to bring about a restoration of this Industry on a sound basis, measures of regulation and taxation must be sponsored by the Federal Goveriunent. Under such regula- tion and taxation, real temperance will be encouraaed. Well-matured wine is the most wholesome of all mealtime beverages. It was never a barroom beverage and should not be considered in the same category with hard, spirituous liquors which today are largely controlled by gigantic pi fixing trusts. Wine grapes have been grown and wine made in Ci fomia for over 160 years. The history of the industry at San Diego soon after the founding by Father Juni; Serra of the first mission there in 1769. During Its history It has undergone a number of changes which c) acterlze dUferent periods. MUeiON PBSIOO. 1T«*-1S4» A single wine grape variety was brought from one of missions of Lower California to San Diego, where It grown successfully and which gradually spread northwarc the chain of Franciscan missions were established from San Diego to the San Francisco Bay region. The grape the Franciscan Fathers introduced, now knc wn as the " mission ", originated, in all probability, as a seedl ng of the monlca, a favorite wine grape of the monasteries of the Mediterranean region, which it resembles very cl( though they are not identicaL It is still found, not onl: California, but in all the regions of North and Soi America. Its origin probably dates from the time of Co; who introduced the European grape to Poru, from wi country it spread to Mexico and Argentina. That it was first grape grown in America is indicated by the " crioUa " (native), by which it is now known in Argent It seems to have been the only grape cultivated by the Si iards In California up to the time of the discovery of gold in 1849. It was grown principally in the southern section of the State and served well the limited requirements of that time. PIONEER PERIOD, 1849-«5 During the first few years of the gold rush the quantity of wine produced remained small and was confined to the neighborhood of the missions. Soon, however, as demand increased, new vineyards w^ere planted by the pioneers, and by 1857 there were, according to the best information, over 800.000 vines in the State, producing 13,000,000 poimds of grapes. The result was so promising that by 1860 they attracted the attention of the State legislature, which re- quested the Governor to appoint a commission to report on ways and means best adapted to promote the fruit and grape growth of California. This request was granted and Governor Downey appointed such a commission. During the following year an extended tour of the principal wine- producing countries of Europe was made and a report was rendered on the methods of grape growing and wine making in Germany, France. Hungary, Italy, and Spain. There was collected and sent to California 100,000 cuttings of 1,400 varieties of grapes, which were planted near the town of Sonoma in the beautiful Sonoma Valley. PERIOD OF DEVELOPMENT. 1865-80 During the first 10 years of this period the vineyard acreage rose from 5,000 in 1865 to 40,000 in 1875, an inciease of 700 percent. During the latter part of this period the methods of wine making were much improved and a number of excellent wineries were built. During this period also more attention was given to the making of wines of high quality, and Cali- fornia wine producers began to establish reputations for the excellence of their wines. PERIOD OF EXPAITSION, 1881-1914 In 1880 the vineyard acreage in California was little more than one twentieth of that reached at the point of its great- est extension about 1923. An increase even more rapid than that of 1865-75 commenced with this period. The 35,000 acres of 1880 became 70.000 in 1881; 103,000 in 1882, and 140,000 in 1883, an increase of 312 percent in 3 years. This great increase was due to the opening up of new grape- growing districts, especially in the San Joaquin Valley. The remarkable activity in the vineyards and wineries again attracted the attention of the State legislature, which again established a viticultural commission of nine mem- bers representing all sections of the State, whose duties were to adopt such measures as may best promote the progress of the viticultural industries of the State and to dissemi- nate useful knowledge of viticulture by means of repwarts, lectures, and conventions. It also directed the board of regents of the University of California to provide special Instruction in the arts and sciences pertaining to viticulture and to carry out investigations and experiments and to pub- lish the results. In 1894 the legislature transferred certain duties of the State viticultural commission to the Agricul- tural College of the University of California, which has attended to them since that time. During the 20 years from 1895 to 1915 the total vineyard acreage increased regularly and without interruption. The first part of this period was characterized by the introduc- tion through the viticultural commission, the University of California, and numerous other private Importers of many of the fine wine grapes of France. Germany. Spain. Por- tugal, and northern Italy, and by renewed efforts, in many cases very successful, to turn out fine wines worthy of aging and bottling and labeling with di.stinguishing names of type, vineyard, and producer. It was the era of small but well- equipped wineries, conducted by men whose efforts were to make fine wines for consumers who could appreciate their value. Before the advent of prohibition California had estab- lished a splendid reputation for quality wines. It took 50 years of patient, costly experimental work and the expendi- tures of vast sums in repairing the ravages of the phyllozera and Anaheim diseases that wiped out 100,000 tLcres of vines in California before the great goal was reached. California tco rnMnPFQQTnMAT. PFrnpn TrnuQp. 'Tamttatjv K 1934 CONGRESSIONAL RECORD— HOUSE 161 wines were finally recognized as the equal of those produced in France, Italy, and Germany. Even abroad they admitted this, for at the International Exposition at Turin, Italy, in 1911 California received the grand prix, the highest award which the exacting jury could confer. At the Panama-Pacific International Exposition In 1915 California offered 300 entries for the Judges to consider. "Iliey consisted of 100 white wines, 83 red wines, 74 sweet wines, 16 brandies, 9 champagnes, 5 sparkling burgundies, and 14 carbonated wines. The high quality of the entries was demonstrated when 20 grand prizes were awarded in the various classes. Another proof of the superiority of American wines was the test they stood at the St. Louis World's Exposition in 1903, when they were placed in competition with the best of every great grape-growing and wine-producing nation of the world. Out of thirty-odd entries of wines California alone was awarded 3 grand prizes and 19 gold medals. In proportion to our entries Cahfomia received more prizes for its wines, brandies, vermuth, and champagne than any other exhibitor. At expositions in the great wine -producing centers of Europe we also secured recognition. Gold medals were awarded California wines at Paris, France, 1894; at Bor- deaux. France, in 1895; and at the Paris World's Exposition in 1900. when our wines carried off 4 gold medals. 9 silver medals, and 9 bronze medals, notwithstanding the fact that hundreds of our choicest dry and sweet wines were not per- mitted to compete for prizes, because, as the Frenchmen claimed, the labels bore the names of French districts, such as California Burgimdy and Sauterne. It is highly important that the Federal Government recog- nize wine as one of the most potent elements in developing temperance. ITie industry should be protected against un- fair foreign competition. A moderate tax should be applied which would bring to the Grovernment a fair and reasonable revenue, which would not handicap the growth and de- velopment of the wine industry of this country, RESOLUTION nOlf THE MINKESOTA STATE LEGISLATXTRE Mr. SHOEMAKER. Mr. Speaker, I ask unanimous con- sent that a resolution passed by the Minnesota State Legis- lature be Incorporated in the Record at this point. The SPEAKER. Is there objection to the request of the gentleman from Minnesota [Mr. Shoemaker]? There was no objection. The resolution is as follows: Concurrent resolution memorializing the Congress to enact legis- lation to protect American Industry and the employees thereof against cheap foreign labor and products Whereas the State of Minnesota and the city of Cloquet are directly Interested In the manufacture of matches to the extent of several hundred persons being employed in that city in this Industry; and Whereas the dximplng of foreign-made matches, notably from Japan. In this country at prices which preclude competition by American-made matches under the present standard of Ainerlcan living and wages; and Wlicreas It will require governmental action against underpaid foreign labor, and drastic regulation against the product of peo- ple w)io work for a few cents a day and live almost wboUy upon rice and fish; and Whereas high labor costs In the American Industry and very low labor costs In foreign match-manufacturing countries have made it Impossible to compete In any other country with foreign match manufacturers; and Whereas the American match Industry has never had real tariff protection: and Whereas this Industry has been continually harassed by unfair Importations of misbranded. mismarked, and Inferior quaUty dumped matches; and Whereas foreign match manufacturers have been guilty of un- scrupulous practices by coloring the splints and so reducing the duty paid to one third or less of the amount Intended by Con- gress; and Whereas during the past 3 years the Government has seen fit to prevent dumping of matches by nine European countries and Japanese Importations have increased from 8.629 gross In Jiine 1932 to 309,700 gross In September 1933, an Increase of 4.532 percent; and Whereas women In the Cloquet match factory under the NJl.A. are paid 30 cents per hour, while women in Japanese match fac- tories are paid 3 cents per hour; and Whereas under present oondltloDs, woUng tuuter the match oode, paying the high wages that the American Industry does, oompettng with the low-ooet matches from Japan and other ooun- tries. It is Impossible for American manuXacturen to compete and continue running unless something can be done in the near future; and Whereas in the city of Cloquet, as a result of this unfair com- petition. 250 pe<^le have lost their employment, and the factory may sxispend wvvk permanently untU the United States Gov- ernment gives added protection against these foreign Importationii: and Whereas if this suspension at cpenMoa takes place, the farm- ers of northern ICIhnesota and Wisconsin wlU lose from •55.000 to $84,000 annuaUy which is now paid to them: Therefore be it ReMolved by the House of Representative* of the Stute of jrropei ly conserve — that is to say. use wisely — our natural resources a|id provide for a more equable distribution of their bounties. We have reached the end of the pioneering period of go ahe^ and take. We are in an age of planning lor the best use of everything for all. We must ultimately pull out from low-scile agricultural production, with its attendant evils of low-standard living, some millions of acres of submarglnal lands. One fifth ^ many good acres will take care of the people now scratching th« m for an existence and will open for these people the gates of a happier life. The abandoned acres should pass back to the con- trol of the Federal Government to be administered for the bene St of the Nation as a whole. In the East this land largely shoved be add-^d to our national forests. In the West, generally speaking, it should revert to the pub Ic domain as an addition to our grazing ranges. The Indians, w lo are badly in need, should also get their share. By such redlstrlb j tlon this soil will be of vastly more service to society than as crap land whereon a sizable proportion of oiur farming population struggles in vain to make a decent livelihood. As to water power, the alternative Is to turn It ovet to prlv^e Interests for exploitation or to retain It as a public trust lor public use. I believe in developing public resources for the bene at of the public and do not see why we should hand them over to someone and tell them to make a profit. Almost all reclamation projects are susceptible of water-power development. BIG WRITES TO BE BIG RIGHTES ThBy And one more parenthetical word about the Indians bring up a conservation problem of a special sort — a matter bf human and spiritual values rather than material values entirejy Creek Indians of the old generation In Oklahoma have a wc for the Secretary of the Interior that contains a certain amoxint bf Irony. Translated, It means "big writer." A century and a hi If of wrongs perse verlngly visited uix>n the Indians have done mui:h that is beyond repair. But as long as I am big writer, there w 11 be no more thievery of Indian water rights and a dipping into tribal fiinds for the construction of fancy roads and bridges fpr white tourists to ride over. Since 1904 our unreserved and unappropriated public lands hai'e shrunk from 473.000,000 acres to 173,000,000. Much of this vast domain was taken up as farm and cattle-raising homesteads. Thi it a considerable part of It was unsulted for those purposes, the prei ent state of the agricultural proprietor and of the small stc< k raiset who has tried to make out on a homestead of 840 acna, bears conclusive testimony. With all good intentions, the Govern ment has been a party to an unsound business allurement fron the effects of which a great many of our citizens have stiffen d January 5 and are suffering. This wrong we propose to correct, making the Government a party to the retirement of poor lands from cultiva- tion and to the voluntary relocation of the people who are trying to cultivate them on better properties. Moreover. I propose to exert my influence to retain our 173,000,000 acres of public domain, and whatever may be added to it. under the control of the Federal Government, rather than to grant It to the States In which it lies. One school of conservationists favors this latter course. I oppose it because I feel certain that the selfish and short-sighted Influences which have done so much to plunder our public domain and bring upon our heads the problems that now vex us would find it much simpler to have their way with State governments than with the National Government. Especially will this be true when the arm of the Federal Govern- ment is strengthened by the contemplated reforms which I hope within a few months will have the .sanction of law. The public domain, exclusive of mineral properties, performs an important function in our social and economic scheme. These 173,000,000 acres are situated largely in the 11 Western States of Arizona. California, Colorado. Idaho. Montana, Nevada. New Mex- ico, Oregon, Utah, Washington, and Wyoming, and these States produce about half of the sheep and one sixth of the cattle that are raised In our country. By a decision of the United States Supreme Court, the public lands are a grazing common for the use of the public. THE IMPORTANCE Or A BLADE OF GRASS The Department of the Interior is charged with the administra- tion of these lands but has very limited authority to control their use. The result has been tragic. Many years ago a member of the Geological Survey contemplated the bleak prospects of a grazing range, upon which the very roots had been eaten, and recom- mended that there be some authority to regulate grazing. He pointed out that without such regulation overgrazing destroyed the cover. Next season one found the grass depleted, and the stock ate out the roots. Then erosion set in. the headwaters of the streams silted up, and there were floods below — all traceable back to overgrazing. As matters stand now. there Is no authority to prevent over- grazing. I can go out with a thousand cattle and pick a range bare of everything that a cow or a steer will eat. You can follow with a herd of sheep. Sheep browze more closely than cattle, and they can subsist on a range where cattle wUl starve. Sheep jvlll eat and tread out the roots of the grass. This situation was the genesis of J;he great sheep and cattle wars in the early days of the powder-stained West. Animosity between sheepmen and cattle- men Is not uncommon today, but instead of shooting it out, as they did in the olden days, they have recourse to the local courts. These courts can determine who shall use the range as between rivals, but they cannot restrict the extent of its u.ortant harbors in view of the Increased volume of commerce on the Pacific — will be represented on the United States Board of Army Engineers. It may Interest you to know that the cargo contribution made by the Pacific coast — Washington, Oregon, and California — Is something in excess of 12 percent of the national water-borne commerce of the United States, while the river and harbor expenditures have been approximately 7.5 percent. One reason, however, for this situation may be the fact that two of our major harbors are of natural formation and have needed very little improvement work on them. I refer, of course, to Puget Sound and San Francisco. I know you wlU be interested In a matter which is frequently of great Importance and to which considerable attention and con- sideration Is being given in Washington and Oregon, and undoubt- edly the same conditions prevail in other parts of the Nation. I refer to the damage that Is sometimes done to abutting shore lands and banks of rivers when river and harbor Improvements are made and dredging work is done. The people and communities along the Columbia River in the States of Washington and Oregon are particularly concerned about this problem. They feel, and I agree with them, that whenever the Federal Government dredges a chan- nel, provision should be made for depositing the diapoeal and dredglngs and sand along and against the banks, dikes, and sea walls In such a way as to fortify and strengthen the same, which could just as well be done, and thereby prevent erosion and the washing away of valuable soil and causing consequent damages. They are, therefore, advocating that legislation be enacted by Con- gress to provide that In carrying out any waterway project, suffi- cient sums be allocated to the engineers to carry out successfully this policy. In some Instances, by dredging and jetty work, the course of rivers has been changed and irreparable damage done to land and even to port docks, without any provision in the law for the taking of proper measures to prevent the same. I men- tion this matter to you briefly, for I think it will undoubtedly be brought before Congress during the next session. I appeared be- fore the resolutions committee this morning and submitted a short resolution In regard to this very matter, and am happy to say that the members of the committee acted favorably on the adoption of the resolution which I presented. Another fact worthy of mention Is that In the Columbia River development the deepening of the channel from Portland to the sea Involved an expenditure of $16,000,000 net. including construc- tion of the very efficient jetty at the mouth of the Columbia River; and during the past 30 years the estimated saving to the American people as a result of this Improvement has been In the vicinity of •300,000.000 to $350,000,000. GRATS HABBOB JETTIES In View of the Importance of Grays Harbor as a seaport and the enormous commerce passing through its gates, and the won- derful natural resources with which it Is surrounded, and Its a«- Biu-ed future as one of the great seaports of the world, it behooves the Federal Government to rebuild tlie south jetty at the entrance to that magnificent harbor, the cost of which Is estimated at the sum of $2,700,000. It Is now from 6 to 12 feet bolow mean low water, and. of course, does not serve the purpose for which It was designed when It was constructed many years ago. and must be re- built if the Important .status of Gray's Harbor as a seaport is to be nialntatncd and continued, for not one dollar has been appro- priated by Congress for the Grays Harbor jetties since 1915 over 18 years ago. The engineers who are familiar with Grays Harbor also express the view that the north jetty should be extended for an additional half mile, and that by extending both jetties for 1 mile to deep water it would make Grays Haxbor one of the finest and safest commercial seaports in the world and probably obviate the necessity of further dredging, which is now costing the Gov- ernment approximately $250,000 per annum. All these Improve- ments could be noade at a cost of five to six million dollars, and such Jetty construction surely would prove as good an investment as the one which was made at the mouth of the Columbia River to which I have Just alluded. ' OVU FCQET BOCND-COLUMBIA BIVCR CANAI. The building of canals has alrendy dpmonstrated Its practica- bility and beneficial effect in our country, and notably In Eiu-ope and clsev.here In the world. At the present time the Columbia Rlvcr-Piiget Sound Canal in we.ncrn Washington, the Florlda- Ocorgla Canal, and the Trenton-New York Canal, are receiving a great deal of coiulderatlon. Needless to say. I am more (amlllar with the proposed Columbia RJver-PugK So^ind Canal, (or It win be located In my district, and would extend from Puget Bound at Olympla to Orays Harbor and (rom Grays Harbor to Willapa Har- bor and from WiUana Harbor to Bakers Bay and the Columbia River, altogether a distance ot 04 miles, and at an esttouited cost ot $3»M0j0O0. It Is not a n*w projert, tor It has an ht*!tortcal background. Jefferson Davis, at the time be wa* Secretary of War, recommended Its construction from Puget Sound to the Columbia River, In 1093 a meinojial to Congress was passed by llie Washington State Senate (avorlng the coruktructlon of a canal (rom Puget Sound to Orays Harbor and to the Columbia River, In 18»5 the Washington House of Representatives passed a similar memorial to Congress. In 1900 the Seattle Chamber ot Commerce passed a resolution requesting the Washington congressional delegation to obtain an appropria- tion for a canal (rom Puget Sound to Orays Harbor and a like resolution was also passed by the Tacoma Chamber o( Commerce. In 1906 the chamber of commerce ot Portland. Oreg.. adopted a resolution urging Congress to appropriate funds (or a canal from Puget Sound to Grays Harbor and to the Columbia River. On March 2. 1907, the River and Harbor Act of that date passed through Congress providing for a preliminary survey and examina- tion of a " ship canal connecting the waters of Puget Sound with Grays Harbor ", and as a -direct result of that congressional enact- ment there was held on March 29, 1907, In Aberdeen, on Grays Harbor, a public hearing In regard to the canal project. At that time, and during all the period since, the project has not been deemed timely by the United States Army Engineers, but the gen- eral concensus of opinion Is that the time for Its construction has now arrived, and that the present would be most propitious, Dtirlni- the last session of the State Legislature of Washington senate mil 267. approprlting $50,000 for a survey for the construc- tion of a canal from Puget Sound to Grays Harbor and from Grays Harbor to Willapa Harbor and from Willapa Harbor to the Colum- | bla River, was passed by the house and senate almost unanimously, \ with hardly a dissenting vote, and was favored by all the repre- ' sentatlves of the people of the State of Washington In the legis- lature; and July 6. 1933, His Excellency Gov. Clar&nce D. Martin Issued his official proclamation setting forth the benefits and advantages to be derived from the construction of the canal. On September 21 and 22 of this year extensive hearings were held at Aberdeen and Olympla, Wash., before Lt. Col. C. L. Sturde- vant. district engineer. United States Army Engineers, pursuant to a resolution sponsored by me and which was passed by the Com- mittee on Rivers and Harbors of the House of Representatives. At these hearings, which lasted for several days, hundreds of wit- ziesses were heard and a mass of evidence was submitted setting forth the benefits and advantages that would accrue from the construction of the canal. Prominent representatives of every importaut Industry, business, and groups of citizens made state- ments, and the entire project In all its details and ramifications was thoroughly presented. The feasibility and practicability of the canal from an engineer- ing standpoint and its commercial. Industrial, and maritime phases were described in detail by those conversant with the same and by numerous manufacturers and shippers who possess expert knowledge relating thereto. It Is a very Important fact to bear In mind that the Federal Government and the State of Washing- ton have a deepr Interest in this canal project. In view of the fact that the Federal Government owns 37 billion feet of timber in Its Immediate vicinity and the State owns 5 billion feet tributary to the route proposed for the canal. As an official of the Federal Government, may I mention 1>rlefly the aid that such a canal woxild be to the national defense? If constructed. It would provide a direct water route from Fort Lewis to the Columbia River for the movement of troops, heavy artillery, and munitions. Without the canal the same would have to be tran^Kirted by truck (rom Olympla westward to Grays Harbor and (rom Grays Harbor to the ColiunbU River, for which the present ! blghway bridges are probably inadequate. Also at the present time all naval vessels going to the navy yard at Eretacrton or Puget Sound must enter through the Straits of Juan de Puca With the only present facilities being from the navy yard to Orays Harbor and thence to the Columbia River. The canal will accom- modate destroyers and small craft and in case of national emer- gency would be of substantial value. The Federal Government has built a ntunber of canals In the East and South, and it woiUd seem reasonable to ask that one be also constructed in this secUon of the country. Needless to say. both the Grays Harbor Jetties and our Columbia River -Puget Sound canal projects are being urged on account of the employment their construcUon would give to a large number of citizens, aud it Is hardly necessary to mention tlic fact. v.h*ch you all know, that in our region where lumbcrmg is tho basic Industry we have suffered from the depression to as g-f-at an extent as any section in the United States, and probabiv more so than many places. We believe that It will be dlScuit to find projecu more meritorious than these, and which would give as good value for the money expended and bo of pcrniiinrht and lasting valiie to the Federal Government, and al the same time (umlsh Jobs azad employment where the same are so /adJy needed. My friends, I see that my time has just about expired, and I hope that I have made It clear to you that I am Vf-rv Ij.cndiy to waterway development in the UnlU«d States, and I 'hoj>e in th" future to lend what nld and assistancr I ran to tverv worthy project, of which I feel that we have quite a numl>er. as I hsve already Indicated, in the part ot the country whlrh l rtprtmut 1 Uiank you very kindly for the patient attention with which you have lietened Uj these remarks. ma nofc^Ko rvan novnv, okays tiAeooe, wu.uii'A marsor. a«> COLUMBU KIVRK CAKAI. Mr. Speaker, under kave to extend my remarks In the Recoed I in*&rt an article prepared by the Pacific Northwe»t Waterways Ajiaociation. dc«crlWng the mertta of the propoted canal connecting Puget Sound, Orays Harbor, Willapa Har- bor, and the Columbia River. The article i« as follow*: A ^WEST or Facts CovczRKuro the PBoeosco Caxam Coutticnna PUCET SOCMD, ORATS H/.RCOR. WlLUlPA HaRBOR, AND THE COLUMBIA B,xrtM. — ^A Projbct or VrrsL iMrorrAMce w thb iMTsaabT or Com- MBBOE, lMOV8X«r, AWO MAITOHAt. DBTEWSS rOBZWOBO (By Bear Admiral Luther E. Oregory, CJl-O.. U,fl. Navy (retired)) The proposal to connect Puget Sound with the Coltunbia River by ship canal is not a new Idea. T^ils was first proposed by Jef- ferson Davis while Secretary of War. about 1856. It was suggested as a military measure as well as an aid to commerce. Frota time to time the proposal has beeh revived, only to be pushed aside, as the magnitude seemed to be too great as com- pared with the needs of commerce. UntU this year no real study has Ijeen made of the project. Some calamity was required to bring it to the fore. That has come In the form of serloiis uuem- ploj-mcnt and therefore extreme losses In the industry of the southwest part of the State of Washington. That action was necessary Is Indicated by the passage of the canal act by the 1983 session of the legislature of the State. A commission was appointed to study the economic feasibility of these canals. It submitted a favorable report on June 7. 1933. The Governor of the SUte. the Honorable Clarence D. Martin ap- proved this report July 6. 1933. It has at the present time, there- fore, the status of an approved project to be constructed as soon as the financial arrangements can be made. This waterway Is a necessity If Washington Is to regain her prestige as the principal soiu-ce of timber and timber products for the United States. Other resources will continue to be locked up until a cheaper method of transportation Is provided tirnn Is now available. Read the Important message conveyed in *-^\f article and give it serious thought. location ako routb op the watbtwat Tbere aie three sections, ta follows: Puget Sound to Grays Harbor Canal: Leavlfig Puget Sound at Olympla by way of Bodd Inlet, thence by way of Perclval Creek through Black Lake. Black River Valley to the Junctlan of Black River and the Chehalls River, thence down the Chehalls River Valley Into Grays Harbor. Length about 50 miles. Grays Harbor to Willapa Harbor: Leaving the channel of Orays Harbor at South Bay, passing In a general southerly direction close to the foot of the bluffs, and on the westerly side thereof, for a distance of about 0 miles, entering Willapa Harbor on the northerly side of the Tcriceland Peninsula. Willapa Harbor to ColumbU River: Leaving WlUaoa Harbor near Bakers Slough, thence In a general southerly direction along the easterly edge of the bog land and close to the foot of the bluffs for about 6 miles, thence In a general aoutbeasterly direction, entering tide water at the norttterly end of Bakers Bay. The routes and locations were surveyed and determined by the Canal Commission of the State of Washington. ■ZEC or CAKAI4 The commission recommends thi construction of a lock canal irom Puget Sound at Olympla to Orays Harbor with locks of not leas than M (eet by 600 (eet; a depth at 14 (eet over upper miter 166 CONGRESSIONi^.L RECORI>— HOUSE mitan en tonnige greaiest of sills, and having a total lift of approximately 90 feet above ■ea level: minimum bottom width of canal section to be not than 90 feet for light-draft sea-going ships and capable of futUre enlargement as tonnage develops. The Grays Harbor to Willapa Harbor and to the Coliunbla Rlhrer Canals are recommended on a sea-level basis, with a minim im bottom width of 120 feet for light-draft sea-going ships drawing 13 feet in salt water and capable of futiire development as increases. COST or CANAL Careful calculations of various factors to be considered, «lth full allowance for the requirements of the act creating the cspal commtsston. which declared its purpose to provide the amount of individual employment, result* in an estimate 933Ji21 6C8. as the cost of the entire project. OTIMATSO BgVEKlTE Stud!?s made by the canal commlasUm Indicate a preaent 4nd prospective annual revenue from tolls for the two coastal caiAls of t4e4.000 with a reasonable forecast of Increased tolU to $0S2 300 within a period of 10 yeara. For the Puget Sound to Grays Hat 9or Canal the Immediate prospective toll wo\Ud be $1^5,000 wltf reasonable increase to t2.S60X)00 within 10 years. METHOOS or riMAMCIMO ntOJSCT By terms of the legislative act creating the Canal Conunisi^n the waterways cannot be paid for from State funds. It is the purpose of the sponsors of the canal project to hav^ adopted as a Federal project and paid for by direct Federal of money It Is the rollcy of the Federal Government to the entire cost of waterways as development work necessary uational welfare and defense. All waterways are now operated, and maintained by the Federal Government. Revenues to be derived from tolls (as mentioned above) shojuld In time pay the entire cost of the waterway project. These lev enues will accrue to the National Government, as it Ls the purpose of the association to have the Federal Government take over ]the entire project from start to Hniah. The law of the State forbids any tax levy. There can be no iost to the taxpayers of the State for this construction program; yet the benefits to be derived wUl be theirs directly. It ts le for ow4ed, grants assume BASIC PUBPOSZ or THS WATEKWAT north !m iind ;he ;he To connect the Inland waterways of Puget Sound and ' waters of Alaska to the inland waterways of the Coliunbla Snake Rivers. The present barrier tc inland waterway commi|ni- cation from the Snake River to Juneau is the natural obstacle canals would remove, creating the greatest Inland waterway In world. BXMariTS ASSintZD bt thx pkojsct Construction of the waterway as outlined will provide at ohce the greatest amount of diversified emplo3rment. especially for skilled craftsmen, offered by any project now before the Federal Government, excepting possibly the Tennessee Valley operatior There will be about 60 miles of extended and correlated wo-k Ings. exclusive of dredging, which will offer a Job for every t'oe of workman. A brief outline of the task.-, provided would be about as follows Concrete locks would employ about 3.000 concrete workers laborers, carpenters, steel workers, hoist and pump engineers, 4nd allied craftsmen. Spillway construction, mostly concrete masonry, would empkoy an equal number of the same type of workers. Excavation would employ large numbers of ordinary labor 4nd men who live by the various types of water-front activity — tugbsat and launch men. riggers, loggers, swampers, pipe handlers, firwijen ship carpenters, and deck hands. Simultaneously several thousand men would be employed In daarlng rights-of-way, biUldlng temporary roads, crossings, ind rrtocatlng logging roads, and preparing pUlng and cribbing of many kinds. The formation of canal berm and the subgradlng for roadways along the canal would employ many teams and tractors The bridges to be erected constitute a major operation, employ ng at least another 2.000 men. A vast amount of hand labor wo dd be uaed in the rlprapping and protective work on the canal bar ki Supplementary road buUdlng would utillae the labor of rninv hundreds of men. '^ In addition, as many more men would be Indirectly employed In Industries supplying steel and concrete, lumber and machlni ry and other materials and equipment needed in the canal p It is not exaggerating to say some 20.000 men would be ki work, directly and IndlrecUy. during the period of construction Northwest farmers would benefit dlrecUy by the project requirements of foodstuffs for the multitude of persons ^ on the project would stimulate the demand for eggs butter fioxir. and produce. Clothing supplies, medical and personal of the workers would also be suppUed by Northwest firms In laf^e amounts. "^ Supervision and direction of all these workers would absdrb large numbers of technically trained persons now xuemployed It is evident that unemployment continues to be a menace •oclety's welfare. This project is so located near to centers peculation that many men could work on it and still be part of the time, their homes undistiirbed. and their fbj Intact. Simple camp accommodations will be sufficient for at work. This project is needed to relieve unemployment proJ< ct glien or worki ng met ts. nerds to of hofee f ami] les mtn ttie January 5 country needs the completed canal to Join two great waterwavs The moixey paid out in wages will go into circulation rapidly, stimulating trade and industry In the Northwest. PBOTBCnON rOB LICHT-DRATT VXSSBUB There are about 30.000 craft of various classifications registered at ports along the Northwest waters — Puget Sound, Grays Harbor, Willapa Harbor, and the Columbia River. There are more than 10,000 fishing vessels, many tugs and barges, light-draft cargo vessels, and thousands of pleasure craft which will use the waterways for business and pleasure. In time of bad weather the fishing fleets will find a safe passage through the canals. NAVAL AND MU.rrABT USCS The naval forces at the Puget Sound base are at present limited to the Straits of Juan de Fuca for ingress and egres.1. The pro- posed waterway would permit more than half the commissioned vessels of the Navy to enter and depart by the canal, declare* Rear Admiral Gregory, who also says that the two lower canals would accommodate three fourths of the registered ships of the Navy with the tide at mean hea level. Plans are completed for a submarine base located on the Co- lumbia River. Ttie sea-level canals would allow the submarines to operate from that base through either Grays Harbor. Willapa Harbor, and Puget Sound, in addition to the Columbia River entrance, and come to the relief or support of any naval unit engaged in battle at the straits. Vessels moving from Puget Sound would have three other exit* into the ocean if the canals were constructed. The navy yard at Bremerton is becoming a principal base for construction of cruisers, destroyers, and such craft, and for fleet repairs. The proposed waterways would en- hance its value to the Nation. One of the largest military bases on the west coast. Fort Lewis, is being developed as a priuclpal center of military concentration. The safe and rapid transport and transfer of heavy ordnance and munitions between defensive poinu along the coast is now Impeded by highway bridges of light capacity and highways which are inadequate. The Boeing airplane factory at Seattle, one of the largest cuch plants In the country, produces large numbers of flghting chips for the Government. This Industry deserves the extra protection a canal would give. At Dupont is situated one of the largest powder plants in the country, and at Hogum Bay, near Olympia. is a storage plant of the Giant Powder Co. These industries will provide huge war supplies in case of conflict, supplies which can best be moved by water transportation. With the canal completed, transportation would be facilitated. The cost of one battleship would build the canal, and In the time of national danger the existence of the new waterway might easily be worth a fleet of battleships in Its strategic value. COMMZBCIAL ADVANTAOXS Or THX WATEBWAT Effect on tariffs and transportation was developed before Colonel Sturdevant, United States district engineer, when It was shown that for a 20-mile haul by rail the cost per thousand feet of logs is from 12.50 to $3, depending on weight. The same haul by water would be from 30 to 75 cents. Comparative tariffs on general freight would show similar contrasts. With an annual package and merchandise movement of 450,000 to 500.000 tons flowlngpbetween Columbia River and Puget Sound points, the readjustment of tariffs woiild result in a big saving to shippers. Prospective traffic through the waterway will be greatly increased as the opportunities of water shipment increase. Vast undeveloped natural resources of adjacent regions will be developable with cheap water transportation available. Known deposits of man- ganese. Iron ore. and phosphates in the Elma district, coal regions all along western Washington, logging, lumbering, fishing, and similar activities now existing will all respond to a cheapening of transportation when the waterway is completed. It is proper to assiune that limestone, coal, fuel, ores of all kinds, flsh and fishing vessels, sand, gravel, and cement, pulpwood, pulp, and paper, logs in rafts and on barges, sulphur, phosphates, and acids, pleasure craft, tvigs, scows, and mixed-cargo vessels will use the new waterway as an Inside passage In preference to the out- side route. For many products present high transportation rates prevent development and exploitation. Grain transportation from the interior to the coast by way oc. No. 120) ; to the Committee on the Judiciary and ordered to be printed. 259. A letter from the' Attorney (3en«-al. transmitting a list of suits arising under the act of March 9. 1920 (41 Stat. 525) ; to the Committee on Claims. 260. A letter from the Acting Secretary of the Navy, trans- mitting a draft of m-oposed legislation to amend section 702 of the Merchant Marine Act. 1928; to the Committee on Merchant Marine, Radio, and Fisheries. 261. A letter from the Comptroller General of the United States, transmitting a report on the claim of William E. B. Cirant pursuant to the provisioDs of Private Act No. 208, Seventy-second Congress, approved February 16. 1933 (47 Stat., pt. n. 99) ; to the Committee on Claims. 262. A letter from the chairman of the Interstate Com- merce Commission, transmitting the Forty-seventh Annual Report of the Interstate Commerce Commission (HJXx. No. 137) ; to the Committee on Interstate and Foreign Com- merce and ordered to be printed. 263. A letter from the Acting Secretary of the Treasury, transmitting the report of the Surgeon General of the Public Health Service for the fiscal year 1933 (ILDoc. No. Ill) ; to the Committee on Interstate and Foreign Commerce and ordered to be printed. REPORTS OF COMMITTEES ON PRIVATE BILLS AND RESOLUTIONS Under clause 2 of rule Xm. Mr. DICKSTEIN: Committee on Claims. HJl. 1247. A bill for the relief of Alex Terliazi; with amendment (Rept. ,No. 272). Referred to the Committee of the Whole House. Mr. BROWN of Kentucky: Committee on Claims. HJl. 5163. A bill for the relief of Calvin M. Head; with amend- ment (Rept. No. 273). Referred to the Committee of the Whole H(}use. PUBLIC BILLS AND RESOLUTIONS Under clause 3 of rule XXn, public biUs and resolutions were introduced and severally referred as follows: By Mr. DUFFEY: A bill (HH. 6460) to amend the Home Owners' Loan Act of 1933 by adding after secticm 4 thereof a new section; and to authorise home-mortgage loans, and to appropriate the sum of $500,000,000 therefw. and for other purposes; to the Committee on Ranifirig and Currency. By Mr. CHRISTIANSON: A Wll (H.R. 6461) to prohibit tlie importation of certain agricultural products: to the Committee on Ways and Means. By Mr. TAYLOR of Colorado: A bill for the relief of Carl A. Barzen; to the Committee on Military Affairs. Also, a bill (H.R. 6521) granting an increase of pension to Mary P. Massey; to the Committee on Invalid Pensions. By Mr. SMITH of West Virginia: A bill (H.R. 6522) for ^ the relief of G. T. Thayer; to the Committee on Claims. By Mr. SNYDER: A bill (HJl. 6523) granting a pension to Idella Wade; to the Committee on Invalid Pensions. Also, a bill (HJl. 6524) granting a pension to Anna Mitchell; to the Committee on Invalid Pensions. PETITIONS, ETC. Under clause 1 of rule XXn, petitions and papers were laid on the Clerk's desk and referred as follows: 1474. By Mr. BACON: Petition of citizens of Nassau County, Long Island, N. Y., protesting against change in im- migration laws to permit entry of political refugees from abroad: to the Committee on Immigration and Naturaliza- tion. 1475. Also, petition of large number of citizens of New York. protesting any change in our immigration laws which would permit the entry of alien refugees outside of the legal im- migration quotas: to the Committee on Immigration and Naturalization. 1476. Also, petition of M citizeos of Long Island. N.Y^ that the Army Ah- Corps be brought up to its full rated strength; to the Committee on MillUry Affain. 1477. By Bir. BEEDY: Memorial of the Legislature of Bdaine to the President of the United States and the Con- gress; to the Committee on the Library. 1478. By Mr. LINDSAY : Petition of Holy Name Society of the Church of St. Mary of the Immaculate Conception. Brooklyn. N.Y.. opposing the proposed child labor bill and birth control bill; to the Committee on Labor. 1479. Also, petition of General Box Co.. Brooklyn. N.Y^ concerning tariff on boxes: to the Committee on Ways and Means. 1480. Also, petition of the Coimtry Editor Publishing Co., Inc., Staten Island, N.Y., concerning taxation of alcohoUc preparations; to the Committee on Ways and Means. 1481. Also, petition of the Carbon Dioxide Institute, Inc., New York City, protesting against the existing tax on car- bonic gas used for carbonating beverages; to the Committee on Ways and Means. 1482. By Mr. PATMAN: PetiUon of James A. MiUer and several hundred veterans of the World War, stationed at .Wolf Creek Camp F-33, Roseburg, Greg., and Redwood City. Calif., for full and immediate cash payment of the adjusted- service certificates: to the Committee on Ways and Means. 1483. Also, petition of James W. Lewis and 61 other citi- zens of Bogata, Tex., urging the enactment of old-age pension legislation; to the Conunittee on Labor. 1484. By Mr. RANDOLPH: PeUtion of West Virginia Leg- islature, memorializing Congress to pass an old persons' pension law; to the Committee on Labor. 1485. By Mrs. ROGERS of Massachusetts: Petition of Wachusett Division, No. 191, of the Brotherhood of Loco- motive Engineers, favoring enactment of a Federal law pro- viding for retirement pensions for old and incapacitated railway employees and declaring against the Wagno'-Crosser bill; to the Committee on Labor. 1486. By Mr. SANDERS: Petition of members of the Women's Missionary Federation of the American Lutheran Church in Texas, protesting against the tax on sale of pillow lace made in industrial school in Gudur, India, and sold by these members; to the Committee on Ways and Means. 1487. By Mr. SMITH of West Virginia: Memorial of the West Virginia Legislatiu-e, memorializing Congress to pass an old-age pension law; to the Committee on Labor. 1488. By the SPEAKER: Petition of the National Associa- tion of Letter Carriers, regarding the transfer of substitute mail carriers; to the Committee on the Post Office and Post Roads. 1489. Also, petition of Edward Elsas. regarding a universal language; to the Committee on Education. 1490. Also, petlti(m of Breed Abbott & Morgan, of New York, regarding the recent Ijmchings in the United States: to the Committee on the Judiciary. SENATE Monday, January 8, 1934 Rev. A. C. Millar, DX)., editor of the Arkansas Methodist, of Little Rock, Ark., offered the following prayer: Our Heavenly Father, we recognize Thy power. Thy wis- dom, and lliy love, and we honor and adore and love Thee. We recognize our own weakness and Thy strength, and we invoke Tliy help that we may grow stronger. We recognise our shortcomings and confess our sins before Thee and pray that Thou wilt forgive and restore and cleanse and strengthen us. We recognize that Hum art God not only of men but I 170 CONGRESSIONA.L RECORD— SENATE of nations, and we thank Thee for the Nation in which we live and for Thy blessings upon it. and we pray that rhou wilt help us to be the kind of people that Thou WQuldst have us be. Bless our President and all who are in authority] and give them health and mental ability and moral stritngth to discharge their duties. We pray for our country, that our people may be a God-fearing and a God-loving psople. that they may be loyal to their institutions and meetltheir obligations in the right way. We pray that our relations to all the nations of the world may be such that we may be helpful, that we may be a blessing to the world of vhich we are a part. We pray for Thy special blessing. Heavenly Father, jupon this body, ujwn its President and every Member. Crrant that they may be men who love and fear Thee, help them to do right as men and as officials, and help them to r »cog ni2e that their primarj' obligation is to Thee and their con- science. Continue to guide and bless them, and flnalljl give sake. January 8 We beg for Christ's West 3tate the Mr. had us all a home with Thyself. Amen. HiNiY D. Hatthld. a Senator from the State of Virginia, and Hubert D. Stephens, a Senator from the of Mississippi, appeared in their seats today. THE JOURNAL The Chief Clerk proceeded to read the Journal c proceedings of Thursday. January 4. 1934. when, on refauest of Mr. Robinson of Arkansas, and by unanimous cor sent the further reading was dispensed with and the Journal was approved. MESSAGE FROM THE HOUSE A message from the House of Representatives, by Haltigan. one of its clerks, aimounced that the House passed a bill (HJi. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes, in whi^h it requested the concurrence of the Senate. MESSAGES FROM THE PRESIDENT — APPROVAL OF BILLS Mecsages in writing from the President of the States were communicated to the Senate by Mr. Latta of his secretaries, who also announced that on Jun< 1933, the President had approved and signed the acts: S. 813. An act to remove the limitation on the the vacancy in the office of senior circuit judge for ninth judicial circuit; S. 815. An act to provide for the survival of certain ac in favor of the United States; S. 1513. An act to amend Public Act No. 435 of Seventy-second Congress, relating to sales of timbei Indian land; S. 1561. An act providing for pasTnent of $50 to enrolled Chippewa Indian of the Red Lake Band of sota from the timber funds standing to their credit in Treasury of the United States: S. 1580. An act to relieve the existing national in relation to interstate railroad transportation. an4 amend sections 5, 15a, and 19a of the Interstate Act. as amended; and S. 1872. An act to extend the times for commencing completing the construction a bridge across the Broad River on the proposed Morristown-Newport road tween Jefferson and Cooke Counties, Tenn emergency to Comnierce CALL OF THE ROLL I suggest the absence of a quorum, and ask Mr. LEWIS, for a roll call. The VICE PRESIDENT. The clerk will call the roll. The legislative clerk called the roll, and the following Senators answered to their names: Adams Asbunt Austin Bachman BaUey Bankhead Barbour Barkley Black Bone Brown BulUcy Billow Byrd Byrnes Capper Caraway Carey Clark Connally CooUdge Copeland Costlgan Couzena Cutting Davis Dickinson Dill Duffy Erlckson Fess Fletclier Prazler King O'Mahoney Stephens George La Follette Overton Thomas. Okla. Glass Lewis Patterson Thomas, Utah Goldsboroui^i Logan Plttman Thompson Gore Lonergan Pope Townsend Hale Long Reed TrammeU Harrison McAdoo Reynolds Tydlngs Hantlnga McCarran Robinson. Ark. Vandenberg Hatch McGUl Robinson. Ind. Van Nuys Hatfield McKcllar Riissell Wagner Hayden McNary Schall Walcott Hebert Murphy Sheppard Walsh Johnson Neely Shlpstead Wheeler Kean Norrls Smith White Keyes Nye Stelwer Uiiited one 16, follojwing fillirig of the ions the on ?ach the Mime and ncl be Pnnch Mr. HEBERT. I desire to announce the necessary absence of my colleague the senior Senator from Rhode Island [Mr. Metcalf], and also the Senator from South Dakota I Mr. NoRBscK] and the Senator from Vermont [Mr. Gibson]. I also wish to announce that the senior Senator from Idaho [Mr. Borah] is unavoidably absent. Mr. LEWIS. I wi£h to announce that my colleague the junior Senator from Illinois [Mr. Dieterich] is necessarily detained from the Senate. The VICE PRESIDENT. Ninety-one Senators have an- swered to their names. A quorum is present. TAXATION OF ALCOHOLIC LIQUORS — HOUSE BILL REFERRED The VICE PRESIDENT. The Chair lays before the Sen- ate a bill coming over from the House of Representatives, which will be read by title. The bUl (H.R. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes, was read twice by its title. Mr. ROBINSON of Arkan.sas. I invite the attention of the Senator from Mississippi [Mr. Harrison] to the bill com- ing over from the House, so that it may be referred. Mr. HARRISON. I move that the bill be referred to the Committee on Finance. The VICE PRESIDENT. Without objection, it is so or- dered. NOBEL PEACE PRIZE The VICE PRESIDENT laid before the Senate a letter from the Acting Secretary of State, transmitting copy of a circular issued by the Nobel Committee of the Norwegian Parliament furnishing information regarding the proposals of candidates for the Nobel peace prize for the year 1934, which, with the accompanying paper, was referred to the Committee on Foreign Relations. REPORT OF SURGEON GENERAL OF THE PUBLIC HEALTH SERVICE The VICE PRESIDENT laid before the Senate a letter from the Acting Secretary of the Treasury, transmitting, pursuant to law. the report of the Surgeon General of the Public Health Service for the fiscal year ended June 30, 1933, which was referred to the Committee on Finance. ANNUAL REPORT OF THE ATTORNEY GENERAL The VICE PRESIDENT laid before the Senate a letter from the Attorney General, transmitting, pursuant to law, the annual report of the Department of Justice for the fiscal year ended June 30, 1933, which, with the accompanying report, was referred to the Committee on the Judiciary. SUITS ARISING UNDER PUBLIC VESSEL ACT The VICE PRESIDENT laid before the Senate a letter from the Attorney General, transmitting, pursuant to law. a list of suits arising under the Public Vessel Act of March 3, 1925. in which final decrees were entered, exclusive of cases on appeal, which was referred to the Committee on the Judiciary. SUITS IN ADMIRALTY AGAINST THE UNITED STATES The VICE PRESIDENT laid before the Senate a letter from the Attorney General, transmitting, pursuant to law, a list of suits arising under the act of March 9. 1920 au- thorizing suits against the United States in admiralty in- volving merchant vessels, in which final decrees were entered against the United States, exclusive of cases on appeal which was referred to the Committee on the Judiciary. ANNUAL REPORT OF ADMINISTRATOR OF VETERANS' AFFAIRS The VICE PRESIDENT laid before the Senate a letter from the Administrator of Veterans' Affairs, transmitting. /-i/^^Ti-iTiT^ociT/^xT A r ■nT7»rT\ ccxT A lyc T * XTTT k 1>V O 1934 CONGRESSIONAL RECORD— SENATE pursuant to law, a report of activities of the Veterans' Administration for the fiscal year ended June 30. 1933, which, with the accompanying report, was referred to the Committee on Finance. COMPENSATION OF OFFICIALS OF FEDERAL RESERVE AND MEMBER BANKS The VICE PRESIDENT laid before the Senate a letter from the secretary of the Federal Reserve Board, transmit- ting in response to Senate Resolution 75, agreed to May 29, 1933, a report showing the compensation of executive officers and directors of Federal Reserve and member banks, which, with the accompanying report, was referred to the Com- mittee on Banking and Currency. DEVELOPMENT OF OIL AND GAS POOLS The VICE PRESIDENT laid before the Senate a letter from the Secretary of the Interior, transmitting, pursuant to law, information concerning the approval of unit plans of development and operation for Pitchfork oil field, Park Coimty. Wyo., which, with the accompanying report, was referred to the Committee on Public Lands and Surveys. ANNUAL REPORT OF SHIPPING BOARD The VICE PRESIDENT laid before the Senate a letter from the chairman, advisory committee, United States Ship- ping Board Bureau, transmitting, pursuant to law, the Seventeenth Annual Report of the United States Shipping Board and the United States Shipping Board Merchant Fleet Corporation for the fiscal year ended June 30, 1933. which, with the accompanying report, was referred to the Committee on Commerce. REPORT OF COMMISSIONERS OF DISTRICT OF COLTTMBIA The VICE PRESIDENT laid before the Senate a letter from the president of the Board of Commissioners of the District of Columbia, transmitting, pursuant to law, a re- port of the official operations of the government of the Dis- trict of Columbia for the fiscal year ended Jtme 30. 1933, which, with the accompanying report, was referred to the Committee on the EWstrict of Columbia. REPORT OF EMPLOYEES' COMPENSATION COMMISSION The VICE PRESIDENT laid before the Senate a letter from the Chairman of the United States Employees' Com- pensation Commission, transmitting, pursuant to law. the report of the operations of the Commission for the fiscal year ended June 30, 1933, which, with the accompanying report, was referred to the Committee on Education and Labor. PROPOSED CONSTITUTION AMENDMENT RELATIVE TO CHILD LABOR The VICE PRESIDENT laid before the Senate a letter from the Governor of West Virginia, transmitting preamble and joint resolution of the Legislature of West Virginia rati- fying the so-called "child labor" amendment to the Con- stitution, which, with the accompanying papers, was ordered to lie on the table, as follows: State of West VntciKiA, ExEcunvK Depaktment. Charleston, January 5, 1934. Hon. John Nanci Oarncr. Vice President of the United States. Washington, D.C. Sib: Permit me to transmit herewith preamble and Joint resolu- tion of the Legislature of West Virginia ratifying the " child labor " amendment to the Constitution of the United States. Very respectfuUy, H. G. KuMp. Governor of West Virginia. House Joint Resolution No. 1 (by Mr. Beacom) ratifying the child- labor amendment to the Constitution of the United States Whereas the Sixty-eighth Congress of the United States of Amer- ica, at Its first session. In both Houses, by a constitutional majority of two thirds thereof, has made the following proposition to amend the Constitution of the United States of America, in the foUowlnC words, to wit: " Joint resolution proposing an amendment to the Constitution of the United SUtes * Restdved by the Senate and House of Representatives of the United States of America in Congress assembled (ttco thirds of each House concurring therein). That the following amendment to the Constitution be. and Is hereby, proposed to the States, to become valid as a part of the Constitution when ratified by the legislatures of the several States, as provided by the Constitution: in "SacnoN 1. Th« Oongrea* Aall hav* powar to limit. n«ialat«, and protilblt Uie labor Uc markete for the eom- modlties raised by them are leas than the coat of producing such commodities; and Whereas the impoveriahment of the farmers of the Nation will ultimately Impoverish all the people of the Ifofelon: and Whereas it U Imperative that lagiatatton be enacted by Congress designed to secure fair prlcea for agricultural producta to the pro- ducers thereof; and Whereas daliy prodncto constitute a subetantlal portion of the total products produced by the farmers of the Nation : Now. there- fore, be it Resolved bp the Bouse of RepresentaUves of th^e State of Mtnne- tota (the senate concurring). That the Congreaa at the United States be. and it is hereby, urgently petitioned to needUy enact legislation which will: (1) Provide for the Immediate removal of enough batter and cheese from the public markete ao as to absorb the present sur- plus, and distribute this surplus to pec^e for relief use. (2) Bring about the immediate restrtcticm of the production of dairy substitutes, through a quota system or otherwise, and bring about the prevention of the importation at foreign oils and fate and dairy producta so long as dairy prices In this cotmtry are below the cost of production. (3) Remedy the overprodxaction of dairy producta by the appro- priation of $100,000,000 for the eradication of cattle infected with tuberculosis or Bang's dlaease. (4) Provide for repayment of the moneys advanced by the PW- eral Government for such eradication of Infected cattle through a 6-percent ad valorem tax. to be paid by the processor, as distin- guished from the present plan of collecting processing taxes from processors and handlers, which are ultimately paid by and are a burden upon the producer. (6) Provide an effective plan to prevent lands withdrawn from cotton, wheat, tobacco, corn, and other crop production under the Federal Government's plan of acreage reduction from being utilized for the pasturage and/or feed and/or forage crops for the increase of dairy production. (6) Restrict the Importation of aU agricultural commodities that compete with the producta of our domestic producer; be It further i2esoI:>ed, That a duly authenticated cony of this resolution be presented to the President of the United 'states, to the presiding otDcers d the Senate and the House of Etepresentatlves rld under every imaginable handicap that monometallism can create, and It is apparent that it cannot succeed unless and until it is restored to its ancient and time-honored position of unllm ted partnership with gold in the world ciurencies and exchanges; ind Whereas this restoration is the only possible alternative to a wide-spread and uncontrollable inflation of cxirrency by pnper Issues of so-called " money ". no greater calamity than which can befall the people of any country: Now. therefore, be it Resolved by the Senate of the Ttoenty-ninth General As$en bly of the State of Colorado in extraordinary session assembled i the house of representatives concurring herein). That the Congress of the United States be urged and requested at its session begin- ning on Wednesday, January 3. 1034, or as soon as possible there- after, to take up, put through its necessa^ stages, and eaact Senate 70 (by Senator WHiEKT.sa), restoring to the people ofjtbe United States the bimetallic monetary system of coinage as estab- lished by the act of Congress of 1832, and repealed by the act of Congress of 1873. [ Resolved further. That copies of this resolution be certifleil to our Senators and Members of Congress, and to the Preslden ; of tha United States, with the request that they and each of t: lem do all In their power individually and collectively to effectuate its object and purposes. Resolved further. That cobles of this resolution duly certiflec i be forwarded to the Secretary of the United States Senate and the Clerk of the House of Representatives, reepectively, at Washington, with the request that they be read into the journals of the lald bodies. We hereby certify that the above memorial Is a correct and xue copy of anginal Senate Joint Memorial No. 5. IUt H. Talbot, President of the SenaiB. Wm. B. McLcak, J Secretary of the Senaie. The VICE PRESIDENT also laid before the Senate a j )int reaohitlon of the Legislature of the State of Wisconsin, ex- pressing confidence in the monetary policy of the President of the United States and assuring him of Wisconsin's Con- tinued whole-hearted support of his program for national recovery, which was ordered to lie on the table. (See Joint resolution printed in full when presented tqoay by Mr. DufTT.) The VICE PRESIDENT also laid before the Senate a ji)int resolution of the Legislature of the State of Wiscoiisin. urging the President of the United States and the nati<|nal administration to take immediate action on the dairy situa- tion, which was referred to the Committee on Agriculture and Forestry. (See Joint resolution printed in fuU when presented tojday by Mr. Durrr J The VICE PRESIDENT also laid before the Senate a joint resolution of the Legislature of the State of Wisconsin, memorializing Congress to enact legislation providing for a minimum living wage in the various industries, which was referred to the Committee on Education and Labor. (See joint resolution printed in full when presented today by Mr. Dvrrr.) The VICE PRESIDENT also laid before the Senate resolu- tions adopted by the Minnesota Junior Taxpayers Associa- tion. Minneapolis, Minn., favoring the appropriation of $1,000,000,000 annually for the next 3 years to maintain es- sential educational services for the children of the Nation. which were referred to the Committee on Education and Labor. He also laid before the Senate resolutions adopted by the Common Council of the City of Manitowoc, Wis., favoring the passage of legislation to extend the period of operation of the P.C.W.A. beyond the period already fixed, indefinitely, and until the recovery of industry and the economic welfare of the people render its operation no longer necessary, whicii was referred to the Committee on Finance. He also laid before the Senate petitions of Miss Mildred Baker and Mrs. Ella C. Baker, of Greenwood; of Blanton P. Theus and sxmdry other citizens of Arcadia; and J. B. Her- old and other citizens of Shreveport, all in the State of Louisiana, praying for the expulsion of Hon. Huey P. Long and Hon. John H, Overton from the Senate, which were referred to the Committee on the Judiciary. Mr. DUFFY presented the following joint resolution of the Legislature of the State of Wisconsin, which was ordered to lie on the table: State or Wisconsin. "• Joint resolution expressing confldsnce In the monetary policy of the President of the United States and assuring him of Wiscon- sin's continued whole-hearted support of his program for national recovery Whereas President Roosevelt Is a firm believer in a sound cur- rency and has definitely committed himself to that principle both before and since taking his oflQce; and V/hereas the national administration's monetary policies are an Integral and indispensable part of the program for national recov- ery, and were developed and put into operation only after the most careful and thorough study as one of the means of attaining recovery; and Whereas the principal objective of such monetary policies so far has been and now is to so manage the currency as to secure a rise in commodity prices up to the average price level of 1928 and, upon attaining this, to stabilize the dollar and bring about a per- manently-stable currency fair alike to creditors, debtors, and wage earners; and Whereas a monetary policy Involving uncontrolled Inflation should be discouraged and avoided in view of the disastrous ex- periences of some of the Eiu-opean countries which adopted that policy; and Whereas the great majority of the American people are whole- heartedly behind the President in his recovery program, because they believe that the President is making and will continue to make every reasonable effort to completely lift and permanently keep this Nation out of economic depression: Now, therefore, be it Resolved by the assembly (the senate concurring). That this legislature expresses its confidence in and support of President Roosevelt's monetary policy as a part of his program for national recovery and assures the President that this State and its people wlU continue to cooperate whole-heartedly with the national administration in that program; be it further Resolved. That properly attested copies of this resolution be sent to President Roosevelt, to both Houses of the Congress of the United States, and to each Wisconsin Member thereof. Thomas J. O'Mallst, President of the Senate. R. A. CODBAM, Chief Clerk of the Senate. CORNELltrS YOUNO, Speaker of the Assembly. John J. Slocxjm, Chief Clerk of the Assembly. Mr. DUFFY also presented the following joint resolution of the Legislature of the State of Wisconsin, which was re- ferred to the Committee on Agriculture and Forestry: State or Wisconsin. Joint resolution urging the President of the United States and the national administration to take immediate action on the dairy situation Whereas Wisconsin is the leading dairy State in the Union; and Whereas economic recovery In Wisconsin is dependent upon the rehabUltatlon of the dairy industry; and -tns nfwifivfvdQjcw! M . wrnjiT\ .qf.matf. Jamttarv ft Decome vaim as a part or the ConstltuUon when ratified by the | legislatures of the several States, as provided by the Constitution: 1 Mncz Holm, Secretary o/ State of Minnesota. 1934 CONGRESSIONAL RECORD— SENATE 173 Whereas in the pyrogram for national recovery the dairy industry has not been benefited as have other industries: Now, therefore, be It Resolved by the aasemhly (the senate concurring). That the lort of entry destina- tion must be shown in passbook. On arriving at destination stamp of city clerk must be stamped In passbook, also record taken of said alien, with address; If person goes to another city, said per- son mtist record his Intention with city clerk and destination to be shown. Every time there Is a change of address It must be recorded with city clerk, also In the passbook. Must have at least (500 Insurance at all times. When 5 years have passed, alien must either become naturalized or leave the country. During the 5 years the alien is subject to all the taxea required but is not allowed to own property only in ij^'^T/-lT*Tr»ClC1T/^XT A T Tyi?nrvoT\ CTTXTATT? Javttary S 1934 CONGRESSIONAL RECORD— SENATE 175 tnist tin til aTter the 5 yean. The fees and cost of natvuallzatlon ■haU l>e $35. Requirements for naturalization: Must fuml^ a dean record of reference by two reputable people who have known said person for 5 years, with a comp'ete record of places and kind at employ* ment (}urlng the 5 yean;; record of all organizations and clubs ■aid person has belonged to, with signatures of president and secre* tary: must attend a class teaching the principles of the United States of America Oovemment at least 60 days, showing credits not less than 75 percent; and dependents. Sic. 2. Any alien in the United States at the time of the pcuslng of this bill leas than 5 years must register with the city clerk in the city of residence: obtain a passbook with present or recent pictiire. description, and fingerprints, showing also the name of ship and date of arrival, also port of entry: must record all changes of address with city clerk, and must also have at least $500 insurance. Failure to register 60 days after the passing of this bill, said person shall be immediately deported. Any person harboring said person without passbook Is fined $100; any industry employing an alien without a passbook is fined $500 for each offense. When an alien has been In the United States of America 5 years from date of entry, he must become naturalized within a year: if not, is subject for immediate deportation. Fees and costs to be $25. Naturalization requirements same as section 1. Sec. 3. As a special emergency for a F>erlod of 1 year from day of the passage of this bill, any alien who has been In the United States fcH- 5 years or more, who has paid taxes, either personal or real, or those who have owned property and lost it due to depres- sion, or owns property at the present time, is allowed to apply for fxill citizen's rights without fees or costs by filing of intention showing a record of the places by residence since entering the United States, showing date of entry, also place and date of entry, record of property, stocks or bonds owned, conditions of same, at least one tax receipt, record of all organizations belonged to, rec- ord of insurance, names, ages, and places of births of all children and dependents, names of business f>eople dealt with, signatures of two persons who will furnish sufficient proof of facts of alien's qualification to become a citizen. Sic. 4. Any alien who has been in the United States of Amer- ica 5 years or more and does not own property or never paid taxes must pay a fee of $3. Reqxilrements same as section 8. See. 5. When the year has passed from date of passage of this bill all these aliens who have been in the United States of America 5 years or more and did not apply when told within the years forfeit all rights to be a resident of the United States of America and is subject to deportation. Any employer giving employment to an alien who has been in the United States of Anierica over 5 years and did not apply for citizenship Is liable to a fine of $1,000. REPORT OF THE COMJfiTTEE ON AGRICTTLTURE AND FORESTRY Mr. SMITH, from the Committee on Agriculture and For- estry, to which was referred the biU (S. 1975) to provide for loans to farmers for crop production and harvesting during the ye&T 1984, and for other purposes, reported it with an amendment and submitted a report (no. 148) thereon. ■ILLS INTROOUCSD Bills were introduced, read the first time, and, by unani- mous consent, the second time, and referred as follows: By Mr. TRAMMELL: A bill (S. 2665) to provide for increasing the capital of the Home Owners' Loan Corporation for the purpose of making cash advances to home owners, and for other pur- poses; to the Committee on Banking and Currency. By Mr. COSTIGAN: A bill (S. 2066) to include sugar beets and sugarcane as basic agricultural commodities under the Agricultural Adjustment Act; to the Committee on Agriculture and Por- .estry. By Mr. OVERTON: A bill (8. 2067) authorizing payment to the Red River, Atchafalaya, and Bayou Boeuf Levee District for acquiring certain levee rights of way for flood-control work; to the Committee on Commerce. By Mr. DUFFY: A bill (S. 2068) to increase the maKimum limit of loans by Federal land banks in certain cases; to the Committee on Banking and Currency. By Mr. McKELLAR: A bill (S. 2069) granting an increase of pension to Julius Buxbaum (with accompanying papers); to the Committee on Pensions. A ball (S. 2070) to amend subdivision 2 of paragraph (a) of section 203 of the National Industrial Recovery Act; and A biU (S. 2071) to amend subdivisioa 3 of paragraph (a) of section 203 of the National Industrial Recovery Act; to the Committee on Banking and Currency. A bill (S. 2072) for the relief of Dr. Thomas J. W. Brown: to the Committee on Civil Service. A bill (S. 2073) for the reUef of IliQinAS Green; A bill (S. 2074) for the reUef of James R. BCanafleld; and A bill (S. 207S) for the relief of John J. Tatum; to the Committee on Claims. By Mr. ASHURST: A biU (6. 2076) for the relief of George StoII and the belrs of Charles P. Regan, Marshall Turley. Edward Tjinnigan. James Manley, and John Hunter (with accompanying papers) ; to the Committee on Claims. (By request.) A bill (S. 2077) regulating procedure in criminsd cases in the courts ro vide that the United States shall aid the States in the ^on struction of rural poet roads, and for other pm-poses ", proved July 11. 1916. as amended and supplemented, for other purposes: to the Committee on Post Offices Post Roads. By Mr. CAPPER: A bill (S. 2103) to authorize the Reconstruction Finance Corporation to make loans to aid in the operation maintenance of institutions for religious instruction worship, and for other purposes: to the Committee on B^- ing and Currency. By Bfr. NORRIS: ^A bill (8. 2104) for the relief of George W. Baker: to Committee on Milita.ry Affairs. A bill (8. 2105) granting a pension to Prank Swarts the Committee on Pensions. By Mr. PnTMAN: A bill (8. 2106) authorizing the granting of public linds to States and political subdivisions for airport purpose^ the Committee on Public Lands and Surveys. By Mr. TYDINGS: A bill (S. 2107) to repeal Federal liquor prohibition laws to the extent they are in force in Puerto Rico: to the Com- mittee on Territories and Tnsular Affairs. By Mr. STEIWER: A bill (8. 2108) relating to loans by the Reconstruon learning of the discriminations and oppressions Imposed by the Reich upon its Jewish citizens; and be it further Resolved, That the President is requested in such communica- tion to express the earnest hope of the people of the United States that the German Reich will speedily alter its policy, restore to its Jewish nationals the civil and political rights of which they have been deprived, and undo so far as may be the wrongs that have been done them. INFORMATION RELATIVE TO PROCESSING TAXES Mr. VANDENBERG. I send to the desk a Senate resolu- tion and ask for its immediate consideration. The VICE PRESIDENT. The resolution vnll be read for the information of the Senate. The legislative clerk read the resolution (SJles. 121), as follows: 1934 CONGRESSIONAL RECORD— SENATE 177 Resolved, That the Secretary of Agriculture Is hereby requested to send to the Senate a statement concerning so-called " process- ing taxes " collected up to December 31, 1933, giving, first, the amount of such taxes tollected up to December 31, 1933, classified both as to commodities and States in which tax collections orig- inated: second, the amounts of disbursements from these funds for the same period similarly classified: and third, the cost of collecting and disbursing these funds and administering this tax system. The VICE PRESIDENT. Is there objection to the pres- ent consideration of the resolution? There being no objection, the resolution was agreed to. AMKRICAN NATIONAL MARmME BOARD Mr. JOHNSON. I submit a resolution and ask that it be read, and, if there be no objection, I ask for its present con- sideration. The VICE PRESIDENT. The resolution will be read for the information of the Senate. The Chief Clerk read the resolution (SJles. 122), as follows: Whereas the development and successful operation of an American merchant marine is, to a very large degree, based upon Intelligent cooperation and good will between managers of oper- ation and the personnel aboard the ships; and Whereas the value of such cooperation and desirability of establishing and maintaining such harmonious relations has been fully recognized by two of the world's great maritime nations. Great Britain and Japan. In each of which national maritime boards have been organized Jointly by shipowners and seamen for the exprers pvirpose of'secv.rlng cooperation and fostering the sea power and the maritime supremacy of the respective nations; and Whereas cooperation and the promotion of harmonious relations between American shipowners and American seamen could be ob- tained by means of an American national maritime board with the following objects and purposes: (a) The development of seamanship, skill, and efficiency. (b) The prevention and adjiistment of differences between ship- owners and seamen of all ratings. (c) The establishment, revision, and maintenance of standard rates of wages and approved conditions of employment In the merchant marine. (d) The selection and. when possible, the operation of employ- ment offices for seamen in cooperation with the United States De- partments of Commerce and Labor: Therefore be It Resolved, That the Secretary of the Department of Commerce, the Secretary of the Department of Labor, and the Postmaster Oeneral be, and they are hereby, requested to confer upon the advisability of Initiating an American national maritime board, as herein outlined, and for that purpose to call Into conference such representatives of shipowners and seamen as may. In their Judgment, be helpful in the formation of such an organization, and to report their proceedings and their conclusions to the Senate. The VICE PRESIDENT. Is there objection to the pres- ent consideration of the resolution? Mr. ROBINSON of Arkansas. Mr. President, I think the resolution had better go over in order to afford Senators an opportunity to become more familiar with its provisions. Mr. JOHNSON. I am willing, if the Senator desires that it shall go over. The VICE PRESIDENT. The resolution will go over under the rule. IN70RMATI0N REGARDING PIGS AND HOGS Mr. CAREY. I send to the desk a resolution and ask unanimous consent for its immediate consideration. The VICE PRESIDENT. The resolution will be read for the information of the Senate. The legislative clerk read the resolution (SJles. 123), as follows: Resolved, That the Secretary of Agriculture be, and he Is hereby, requested to send to the Senate a statement containing the follow- ing facts: 1. The total number of pigs and hogs purchased by the Oovem- ment between the dates of August 23. 1933, and October 7, 1933. both Inclusive; the total live weight of the same; and the total dollars paid. a. The total pounds (live weight) of such pigs and hogs which were processed for the account of the Government. 3. The total pounds (Uve weight) of such pigs and hogs which were destroyed upon order of the Government, together with the number of head and average live weight of the same: how the carcasses of the animals which were destroyed but not processed were disposed of; and what was the total cost of such destruction. Lxxvni- -12 4. Th« number of pounds at edible dreesed producta processed and accounted for by the prooesaors to the Government: the disposition made of such proceesed producU. aa well as the amount now on hand for distribution. 5. What was the average weekly price paid for Uve hogs on tbm Chicago. St. Louis. Kansas City, Sioux City. St. Paul. Denver. Portland. Oreg.. and Port Worth markets dxirlng the 4 weeks pre- ceding the commencement of the Government pig-hog buying campaign; the average weekly price, ezcltxelve of those purchaaad by the Government during ttke time the Government waa In the markets buying as weU as the average weekly price for each week subsequent to the conclusion of the aforesaid pig-hog buying campidgn. In the opinion of the Secretary of Agriculture, what caused the sharp declines between October 18 and November •; the advances for a ahort period, and the ftirther sharp declines the latter part of November and during December. Mr. ROBINSON of Arkansas. Mr. President. It is as- sumed that the principal part of the resolution is directed toward the procurement of information which is probably available or may be readily compiled in the Department. It will not impose any cost to obtain the information, as I understand. Mr. CAREY. I think that is true. Mr. ROBINSON of Arkansas. There is an opinion called for from the Secretary, in addition to the information. Ur. CAREY. Yes. The VICE PRESIDENT. Is there objection to the present consideration of the resolution? Mr. ROBINSON of Arkansas. I have no objection. Mr. KING. Mr. President, I wish the Senator from Wyo- ming would add to the resolution a request to report the gross amount of receipts by the Oovemment. if any, from the processing tax or derived from the sale or disposition of any of the pigs and hogs referred to in the resolution. Mr. VANDENBERO. Mr. President, will the Senator from Utah yield? ? Mr. KINO. Certainly. Mr. VANDENBERO. May I say to the Senator from Utah that the Senate has previously adopted a resolution which will produce the information the Senator now seeks. Mr. KING. Then I shall not press my request. The VICE PRESIDENT. Is there objection to the present consideration of the resolution? Without objection, the resolution is agreed to. ASSISTANT CLERK TO COMXITm ON TERRITOUX8 AND ZNSULAa APTAISS Mr. TYDINOS submitted the following resolution (SJles. 124), which was referred to the Committee to Audit and Control the Contingent Expenses of the Senate: Resolved, That the Committee on Territories and Insular Affairs hereby is authorized to employ an assistant clerk, to be paid from the contingent fund of the Senate at the rate attacklng Insects and diseases which annually kill nil- lions of valuable trees, the prevention of soil erosion, which Gov- ernment experts state annually causes losses running into hin- dreds of millions of dollars, and the improvement of park aieas for recreational \ise. The figures on work completed show that today, for the l irst time in the Nation's history, massed man power has been mide •vaUahle for forest protection and is now at work on an unpnce- dented seale on projects which should reduce the huge anrual lOMes of pact years caused by fire, disease, rodents, and inseits. ronat experts state that 1933 represents the first year in wt:ich the Forest Service has had such an opportunity to conduct con- trol work against lixsects and tree diseases on such a compreten- •iTe seale. They asaert that Insects, pests, and tree and plant diseases rank with forest fires as a menace to the Nation's fof'est properties. Among achievements which stand out in the completed progiam Is the forest protection work done. This includes the constiuc- tk>n of trails through the forests and parks over which Ire- fighting units can operate speedily in event of fire, the consti iic- tlon of fire breaks iiseful in preventing the spread of fires t lat develop, the removal of fire haeards such as highly Inflammi ble dead trees and underbrush, the construction of look-out towers, obaenratorlss. fire-guard cabins, shelter for flre-protectlon eqi Ip- ment, the laying of field telephone wires to connect look->ut houses with points of mobilization for flre-flghting units, con xol operations against tree diseases, and campaigns against tiee- attacklng Insects and rodents. The white-pine blister rust, one oi the most serious menaces to the Nation's 30.000,000 acres of valuable white pine, represented one of the major objectlvei of the forest army. Major items performed under this gensral heading included: 1. Removal of IniUnunable fire hasards from 129, &62 acres 3. Construction of 10.068 miles of truck Ualls. 3. Oonstnaction of 5.058 miles of telephone lines. 4. Construction of 3.917 miles of fire breaiks. 5. Clearing 6.629 miles of roadsides as fire-prevention move. 6. Coostnictlon of 1.700 lookout towers, lookout houses, uid Xod houses. 7. Completion of insect pest control over 800,160 acres. 8. Completion of tree and plant disease control operatlonsl on 1. 475.911 acres. 9. Bodent-control campaigns completed on 3,506.918 acres. Work performed under the general title oS forest-stand im- jffovematt Included thinning forest areas to improve the stind of valuable trees, tree planting and construction of needed build- ing and bridges. The general aim of this forest-stand lmpr< ve- ment was to put the stand of timber into such condition that the desirable trees will make faster growth and the stand is a whole will produce material of better quality. Under this ( en- eral heading, work projects completed included: 1. Forest-stand Improvement on 305,159 acres. 2. Planting of trees upon 35.750 acres and the partial comple- tion of tree planting on an additional 54.115 acres. 3. The completion of 67.784 man-days of work at nurseries. 4. The construction of 4.299 bridges. 347 headquarters buildings. 308 tool houses, and 47 bams. Broaion cod trot, the third major classification of work projects developed into one of the most iIX^>artant phases of the Civi ian OoBsennatkm Corps program. Major work performed in this i ield laeloded: 1. The otunpletlon of erosion control on 388.094 acres and partial completion of control work on an additional 151.555 aires 2. The construction of 68.450 erosion-control dams to regufate stream flow and to check the run-off from heavy rains. 3. Bevegetation work was completed on 21,534 acres. The soU-eroston and soil-saving prognuns have proved (tf gteat Importance to all the cooperating services in this work. The JNa- January 8 the UooMl Forest Ssrvice. with its 162.000,000 acres of national forest land, the National Park Service, the Indian Service, controllii* several million acres of Indian reservations, as well as State and private officials on whose land the conservation workers have op- erated all agree that the work done to save topsoU has been ex- tremely valuable. Forest Service officials refer to this type of work as perhaps as Important as any done. National park officials refer to the erosion-control program as one of the most important un- dertaken by the Clvl.ian Conservation Corps. Mr P A Silcox. forester, of the Forest Service, who has had genwal supervision over the work of more than 1.200 camps, states that the work performed by the Civilian Conservation Corps youths and veterans has accomplished much needful and valuable work In the national forests and has served to bring the American public closer to forestry itself and to conservation generally. He points out that fire losses were more than cut in half in national forests during the first 10 months of the current year and attrib- utes much of this saving to the Civilian Conservation Corps boys. In this connection Forest Service officials stated that less than 150 000 acres of national forest land were burned over this year prior to November 1. compared with an annual average for the 5 preceding years of 512.783 acres. Arno B Cammerer. Director of the Office of National Parks, Buildings and Reservations, joins with Forester Silcox in prais- ing the flre-prevention activities of the men. He advised me recently that their presence in the parks this past summer and fall was largely responsible for a reduction of the forest-fire loss in the parks of 37 percent over the same period for 1932. A tre- mendous amount of conservation and general Improvement work also was accomplished In National and Stp.te parks. Improvements admittedly required for years but Impossible of entire achievement for 10 or 20 years in the national park areas, and probably not that soon In State park areas, have been accom- plished or are In the process of accomplishment. As a result, gen- erations to come will derive social benefits from our great recrea- tional areas almost undreamed of when these reservations were established. These opportunities for social service have been enhanced many times. The removal of brush and dead timber from National and State park areas not only reduced the fire hasard but enhanced the scenic value of the parks. Trails were extended, roadsides im- proved through planting and erosion control, camp grounds for the private motorists laid out, and fireplaces and othe recrea- tional facUlUes for the motorist provided. In many States land which was of little value In its then-existing condition was con- verted Into valuable State park property. In many States. State park-development programs were pushed ahead for 5 or 10 years. Much valuable soil-erosion and soil-saving work was accom- plished by the Indians on Indian reservations. John Collier, Com- missioner of Indian Affairs, has stated that the capital value of the Indian lands has been Increased 82 for every dollar spent on the Indian conservation work. The Indian work program included construction of soil-erosion dams, revegetatlon of lands, construc- tion of hundreds of reservoirs to hold water for livestock, forest improvement and protection work, and the conduct of campaigns against rodents such as prairie dogs. In addition to the major projects undertaken, much work was done in the way of restoring historical landmarks. Improving fa- cilities for protecting and increasing wild life, halting the destruc- tion effect of coal fires on the public lands in the vicinity of Gil- lette, Wyo., improving national resources such as forage and range, and clearing roadsides and trails. Work projects were carried on on Federal, State, and privately owned lands. Five projects, utilizing 200 men each, were carried on in Puerto Rico, and one camp was located in Alaska. All told, 1.528 camps were in operation during the first 6-month period. Very truly yours, RoBEHT FxcHNxa. DircctOT. Emergency conservation toork, all services, September 1933 RZPOKT OF PEKSOTNEL, KTC. Service Nam- berof camps I>ays worked (camp days) Peraonosli' Avmet daily numbers em< ployed in - Total Aver- age 1 Total Super- visors Fn- roUMl men Fiell work 0am p dutidi United States 1.528 1.250 175 71 38 I J ( 27.718 '23,909 3,084 129 55 :o 118 18.1 19.1 17.6 1.8 18.4 13.3 2ao ML 7 20^673 213,955 30.543 «13.»«7 i3.5o8 51S COG 977 14.850 12.150 1,826 7W 84 29 13 C6 247, SW i«in« fn oil Forest Service Saxiooii Park Service 201,300 li7.42i 5i,0M 28,717 2n Ml 7 2il Bureau of Indian AOairs Office of tb« Chief of EnKineers Bareaii of Fliologi- cai Survey General Lnnd Office Outlying 13,069 3,5M 4S9 193 912 10, flit 2.70J 313 163 hOt 881 1.743 06 25 51 » ExffcHin* \rmy personn»>l •Kxcludiog camp opora'.io^ persoanjL 1934 CONGRESSIONAL RECORD— SENATE 179 Emergenet anutnttion work, M tertkm RKTORT or PKoaKKas or WORK roR ssmvBXR i«s>— Hiw ooNsntocnoa Clas- sillca- Type of job. State and outlying possessions Camps report- ing Unit of work Amount con- templated Total oom- ptoted Per- oant com- pleted Prevloai'y rsportedas compteted During month Noty«t started tion DO. Completed Partially flomptot«d 1 Telephone lines , 910 566 601 679 221 553 1.271 79 45 4oe 296 297 339 706 224 220 471 289 149 93 321 155 469 450 230 145 296 212 337 112 163 4 191 13 350 341 1 293 88 1 1 181 77 717 89 Miles ... 18,002.0 36.00&3 % 162, 628, 6 17,183.3 iai61.3 1, 736, 562.8 39,243.7 1.489.1 251.8 7.510.7 4.496.9 678.3 3,508.0 647. 613. 7 618.6 671.0 667.0 ei&o 188. 0 163.0 402.0 1810 1.35A.3 2,0eL0 1.35Z3 33&7 195.323 6 1.76&1 184. 717. 6 126^90X0 KOOSlS L 366.0 4 677, 329. 2 89.503.0 4. 010, 63a 7 20,337.2 5ao 4,6K»8.8 086,636.0 aao 4oao 1.404.0 634.0 8,317.0 609.0 i.oaao 21,235.1 4,024.0 27,702.0 4^ 940.0 1,906.4 1,023.6 2,4810 3.753.7 117.0 06.0 673.0 11310 1,008.0 100,120.0 100.3 LO 216,880.3 7,nM,617.0 11,672.084.0 41, 80a 031.0 L737, 406.0 2,308.061.0 08,836.0 3.301.0 36,ooao 880,000.0 45,ooao 6,600.0 isoao 54a 000 0 6>,ooao i4.ooao 2,60aO 2sao Toao 3Lonao 67,aoai &6.5fla4 4.708.0 18,033.3 lao lao 134.0 2.077.228.1 386 0 18.0 1.200.0 1, IM 0 11.836.0 202.0 6,058.0 8,917.2 120.963.2 4,663.1 1.966.1 206,160.5 laoiw 1 446.0 00.0 1.746.0 894.6 104.0 1,168.0 40a 013. 2 347.4 , 808.0 406.0 438.0 47.0 - 66.0 smo 138.0 714.0 1,081.2 977.1 100.4 38,847.6 1, 467. 0 25,750.6 07,784.0 7.203.8 866.0 728,060.5 71,404.0 1.076.011.0 7,486.6 25.0 888,0310 08,64a0 L3 r.3 lao 6.0 27.3 19.3 a. 8 26.6 20.0 80.0 23.2 18.3 18.0 813 73.2 66.3 63.9 71.4 71.3 25.0 416 06.7 7&0 610 615 713 61.9 10.0 83.0 110 63.4 21.4 611 27.3 79.0 41.8 86.8 600 &4 lao 6.6 8,218.0 1800.7 71,718.1 8,801.1 070.3 184.677.3 6,438.0 21L0 618 1.141.4 670.7 30.0 1.0310 303.4410 306.3 353.0 338.0 3610 20.0 UO 23<>0 \T 0 6613 788.0 128.7 411 37,006.1 1,416.0 119011 66.0115 1.4416 666 0 466.707.8 71.158.0 1. 311. 307. 1 6,100.0 1.8314 1.007.6 66.348.1 1.8610 080.0 7a 4618 losai 334.0 318 0013 347.0 06.0 1310 107, 471. 3 80.1 6&.0 07.0 •6.0 18.0 310 400 ILO 161.7 308.3 848.4 1313 1.841.6 410 11 768. 6 11. 17a 6 1840.8 8oao 271061.7 3310 464.7018 13117 210 Vf&, 600. 0 28^6910 1.8614 1,6616 3L637.3 4617 in. 3 17,8010 1067.0 818 8L6 1013 1710 106.8 010 1496.0 1418 1016 64.0 610 017 81.0 710 110 804.0 333.8 610 3S.3 21.7710 410 64,1118 000.0 407 11.079.6 2 Fire breaks do Acres 8a 435. 6 1011 131 1 3 Removal of fire harjirds 4 Roadside clearinR (fire prevention) Miles 11045.6 1083.9 1.611001.8 B.317.7 6 Trailside clearing (fire prevention) do Acres 0 Foreoit stand improvement 7(a) Roads (truck trails), Roads (minor, maintenance only) Miles.-.""" 7(b) do do do 1,007.9 130 7 7(c) Roads (highway, maintenance only) 8(a) Trails (horse) 167ao lflOO.7 S7Q.9 8(b) Trails (foot) do S Look-out houses Number do Man-days NumbM .... do- 10 Look-out towers . . 18410 144,1016 1313 11 Fiphting forest flres 12 Pwellings (headquarters) — 13 Dwelhngs (temporary stations) 157 6 14 Toolhouses (headquarters).. .... do 78 0 15 Toolhouse." (temporary stations) .... do 121 0 16 Barns (headquarters) .. do. 713 17 Barns (temporary stations) do 67 0 18 Office (headquarters) do . . 59 0 19 OfTiw (temporary stations) . . do 2J1.0 20 Other structures (headquarters). do 837 4 21 Other structures (temporary stations) do Miles 756.0 22 Fences (headquarters) 318.5 23 Fences (temporary stations) do 131 1 C4(a) Water systems Feet 131702.0 25 Water (temporary stations) Number Acres 113.3 26 Planting- 104.851. 1 27 Nursery Man -days Bushels Pounds Acres 81800.0 28 Seed collection . 31670.8 28(a) Hardwood seed 8oao 29(a) In^ect-pest control (tree) 1720.0 1.0 67,6311 0016 "181,655.6' 1.5800 .3 1,044,040.7 29(b) In;ie<.'t-pest control (other) . .. do 11 0010 30 Trne- and plant-disease control . .. do 1277. 1817 31 Boundary survey and marking Ba!-ground water 2a8R10 38(a) Pub.'ic camp-ground waste disposal do Miles 31816 0 39 Stream improvement .... 1,341.0 39(a) Lake, pon< , or beach improvement i Acres IMS 40 Dams for fish and birds Number Miles 1.870.4 41(a) Range fences (wire, barb) 1610 8 41(b) Range fences (log) ........... do do 414 41(c) Rnnf<» (enf>^fl (stake and rider) 412 43 Dnvewavs for livestock ....... do 606.0 43 Spring or well development for livestock Number do 1,680.6 44 Keservoirs (stock) 6111 45 Eradication, poiaooous plants „ Corrals Acres.. 61,0X12 46 Number .. do 00.0 46(a) Stock guards . .... . . 1.0 47 48 49(a) 49(b) Range revegetation Acres 31, 635. 4 3,666.018.7 6,4ia978.0 14.466,677.0 8O7,a8a0 356,470.6 64.96L0 14510 31,600 0 38,700.0 3,780.0 0.0 6a7 4&4 316 17.7 16.4 60.7 713 oas 7.4 8.4 18,123.0 1716,407.0 8.047,766.0 7.478,318.0 28^336.4 184,006.0 81886.0 1, 211 0 laooao 14.100 0 4aao 3,4U.6 010,7717 L7C3, 328.0 1970,360.0 7a74L0 171. 570 6 31,6610 L34ao 21.000.0 14.000.0 133aO 8213 181864.0 381846.0 1011116.0 lOOOO 31&,8»10 8010 101031 0 Rodent control do Linear feet Square yards.. do.. Cubic yards.. Linear yards.. Cubic yards... do 1381 H413 Flood oontrol (surveys and grades) lines 5, on, 761.0 Flood control (surveys, lofKjgraphic) 22,431,330.0 49tc) Flood control (dam-site cleArtng) . ..... 1. 43i. 42} 0 49(d) Flood control (river-bank clearing) . . 1, 701 311 6 49(e) 49(0 Flood control (channel clearing) Flood control (dams, earth fill)... 41.560 0 640.0 49(|) 49(b) Flood control (stripping of site). .. 1400.0 Dams (earth excavation) .. . ... do aoasooo 40(i) Dams (rock excavation) . do . do 41, 330. 0 49(j) Dams (concrete) . .. 1600.0 49(k) Dams (rock fill) do 1,000 0 717 Lfloao 000.0 49(1) Dams (steel) Pounds Cubic yards — .... do 640,000.0 49 (m) C hannel eolarKement (sArth excavation) . 7,3oao Lsaao 110 111 5.'66a6 8iao i,7oao 1,6300 418010 49(n) Channel enlargenMnt (rock excavation) 111710 49(o) Reconstruction of existing dams (rock excavation) . . Reoonstruetion of existing dams (earth excavation).. Reconstruction of existing dams (new concrete) do laooo 4Wp) 49(r) do do 36010 loao 49(s) Pounds A cres . . ...... si,ooao 50 Landscaping 21401.0 418711 2,856.0 6,388.3 80.1 75.8 00.7 48.2 16,701.0 80.338.0 1,5810 17100 iToao 116411 1.2710 16718 10610 1C3L8 i.3n.o 10010 8010116 51 Fire presuppression Man-days do Number Days . ... 11.0610 52 Fire prevention (posting signs, etc.) 607.0 53 53(a) Other camp-ground facilities (benches, fireplaces)... GamA And flah at/inkinir 4.6410 10.0 53(b) Forage and game Tons . .. . 10 0 64 Experimental plots Number Actw 63.0 1, 166, 705. 1 3S6.0 15.3 2210 156.0 11.830.0 2010 417 416 lOOO 86.0 1&5 loao 100.0 loao 30.0 87a5«7.1 880.0 0.3 810 " '7.'62i'6" 1410 27.0 3011110 10 101.6710 67.0 55 Timber, range, special uae and claim surveys involv- ing maps. Eliminatien of useless ranee stock 1. 400.019.0 se Number Mites.... 67 Stone guard rail 10 14a 0 1610 4.806.0 00.0 17 58 General clean-up 8610 aes.0 59 Afit-onnrks stonft nartitions Number Man -days Days 61 Firhtiriff coaJ firfifi 6? S4^Hjrhinr for mt>i. a3(d) 34 35 » J7(a) axa) ae 40 4Ua) 41 (b) 41(c) 42 43 44 46 4« 47 48 4»velhnf» ( heH(lqaart«r»> „ D«eliint(S .t«':i;'>j<)rary station) Toi Ihou*.s .tit.idqiiartero TocltKXMKf ''ei HK>iary sitation) Barrj (he-i'i iii-ti'tergi. Barns (teiiujorar.- station) Office (heiMiguiTters' . Oflic* (ternpcrary sLafioni OtfjflT structure-! fheadaTinrter*) Otl'Bjr structures CtempDriry jitation) Fences (beail'i'iarters) Fences (ti-mfioru'y station; WMersyMeiEs Water (tein;ioriry station) Phintlnt-... Nursery Inject pe^t control (tree) Trw and plant disease control Bo'jndary survey and marking Eraion control Dams BridRes (foot) _ Br.dges Oorse) Bridges ( arehiciis) Brid««s (itocfc) Public Rinip-sround building Public caaip-gToond clearing Public camp-ground latrines Public eamp- clearinc) ... Flood control (.caannel clejiringj^ ....... Landsmplng . Fire pneuppressioB Fire preTention (pontine «i?n$, etc.) Other camp-ground faeiiiUes ExperinMntaJ plots KASZO A0BRXSS BT MCPBESSirrATIVK LXICKE. Of KOKTH DAKOT I Mr. FRAZIER. liCr. President, I ask unanimous consiint to have printed in the Rsccno a radio address delivered o. September 23. 1933, by Hon. William Lexkb, a Represen^a tive In Congress from the State of North Dakota. niere being no objection, the address was ordered to be printed in the Rxcou. as follows: Members of the Fanners Union, farmers, and friends, we do not know where we are going, but we are on our way — our c vi- Illation Is In a transition. Whether we wish It or not. we are going from the old to a new civilization. We are discarding >ur old clothes — the clothes of the Mellons. the Hocivers. and the Morgans — and putting on new clothes — the new clothes of 126.000.000 men. women, and children. How well these iiew clothes, this' new clvUlzatlon. will flt us depends upon our vis. on, courage, and intelligence; whether the change will b« for bei ter or for worse depends upon us — the American people. This j lew dvlliaation will be ours: it will not be under the control of the international banicers — the Hotise of iJCorgan. Our saila are ^et; we are sailing unlcnown seas. On March 4 our President delivered the greatest inatigural kd- dress ever given to the American people. He told us on that lay that we were going to drive the money changers oat of the ttm pie. Do not get excited, because 2.000 years ago the Nazartne also drore the money ehangers out of the temple, but they (ot back in: and so, on March 9. within a few minutes after It on vened. the lower House of Congress passed a bill authorizing the pruitui^j ot •2,000,000,000 of paper money for the maatj cbanfl »rs January 8 •/i Mreks*— Continued rOB UPTSMBKa isss— MAixra)(ANrB This bill was not printed, and less than 5 percent of the Members of Congress knew Its content. This unseeming haste on the part of Congress is nothlns^ new. For years Congress has always promptly pusscd any legislation desired by Wall Street and the International bankers. But v;hen the farmers, the laboring people, or the veterans ask for legisla- tion which would be for the welfare and benefit of all the people, then there is years of endless debate and delay— then Congress seems to be deaf, dumb, and blind. This was as true of ths special session of Congress as of the preceding sessions. It was the President's intention that this $2.(X)0.C00.000 should be taken and distributed to the four corners of the United States. It was his intention to supply sufficient money— units of ex- change— ^to transact the Nation's business — but did Wa:i Street and the International bankers take it? They did not. They re- fxjsed to take It, because the President felt that they should pay one half of 1 percent interest or tax to the Government of the United States for the use of this money. Of course, the small bankers throughout this Nation would have been glad to get this money at one half of 1 percent Interest or tax. but they weie In no position to take advantage of this law and the only way they could get it was through V/all Street and the International bankers, and they declined it. At the time that Congress adjoiu^ed only $50,000,000 of this two billion had been taken, and about 3 weeks ago only one hundred and flfty million had been taken, and this one hundred and fifty million is not In circulation. I have endeavored In vain to get one of these new bills, but have been unable to do so. We cannot blame Wall Street and the international bankers for not taking this money for the reason that our Uncle Sam prints th« Federal Reserve uotes and gives them to Wall Street and the 1934 CONGRESSIONAL RECORD— SENATE 181 International bankers through the Federal Reserve Banking Sys- tem for seven tenths of 1 cent per bill — ^the cost of printing. It makes no difference whether that bill Is a dollar bill or a •1.000 bill, or whether they keep It for 1 year or 20 years — all they ever pay Uncle Sam for It Is seven tenths of 1 cent per bill, the cost of printing. Who Is this Uncle Sam that Is so generotxs to Wall Street and the International bankers. Why, that is the tall gentleman with the high hat and striped trotisers. It is you, the American peo- ple— It is the Government of the United SUtes. Our Govern- ment prints the money and gives it to Wall Street and the inter- national bankers through the Federal Reserve System for nothing save the cost of printing. This, in violation of the constitutional provision which provides that the Government shall " coin money and regulate the value thereof." This clearly means that the Gov- ernment of the United States should do the money and credit business of the country, but, instead, the money and credit busl- nese of the Nation has been turned over by our Government to Wall Street and the international bankers. The amount of this paper money given by the Government In the form of Federal Reserve notes. Federal Reserve bank notes, and national bank notes amounted, in round numbers on April 80, 1933, to •4^00.000,000. After your Government had given all this money to those bank- ers for nothing, it found it necessary to borrow back some of the money that it gave away. It had to sell bonds. The amount of these bonds at the time that the special session of Congress met amounted, in round numbers, to $21,000,000,000. These bonds bear on an average 4-percent interest, are tax exempt, and both interest and bonds were payable In gold. In other words, these bankers used the $4,300,000,000 paper money which your Govern- ment gave them for nothing as a revolving fund with which they bought the $21,000,000,000 of bonds. So that when the specijal session of Congress met they had the $21,000,000,000 tax-exempt 4-percent interest-bearing bonds and also had the $4,300,000,000 of money — the money that yo\ir Government gave them for noth- ing. At that time your Government was so broke that It could not pay its Congressmen, and had to issue and sell to the same bankers additional certificates of indebtedness. The special session of Congress did not give the relief to the people that they expected or were entitled to. Many of the laws passed in the special session of Congress are still largely make- believe and not real relief. This Nation is still in agony — it is hungry — milllonb are still In want in the midst of plenty — in the midst of the so-called " surplus " of food — and yet for some strange reason the hungry cannot get any of this svirplus. Unthinking people call it overproduction — reasoning and intelligent people know that the trouble is underconsumption. They know that the law of supply and demand still exists; they know that the supply is here and that the demand is here, but that for some strsinge reason the law of supply and demand does not function. There seems to be a sort of national and international lunacy which makes Intelligent people talk of overproduction and surplus, when In fact the so-called " surplus " Is due to underconsumption. By lunacy I mean Just plain ordinary crazlness. It is tliat kind of national crazlness which impelled the Secretairy of Agriculture to take his picture with a mule In the doubtful occupation of destroying property — of destroying cotton — when those who planted this cotton are still in rage; when there is hardly a man, woman, or child in the United States that docs not need some new clothing that could have been made out of this cotton, and when there are still millions of men and women unemployed who would eagerly take this cotton and make It into finished prod- ucts— into clothing. It Is against international law, even in war time, to wantonly destroy property. To the credit of the mule be it said that he refused to become a party to this transaction; he declined to step on the cotton that his hoof had been trained to spare. History will record which in this particular transaction was the greater statesman, the mule or the Secretary of Agri- culttire. Then there is the lunacy or J\ist plain crazlness which would have us believe that all owr troubles are due to the machine age. This seems to me to be the reasoning of intellectual pygmies. What we need is more labor-saving machines, not less. When I was a youngster and had to put up hay and help harvest and thresh grain I used to pray that someone would come along with sufficient Inventive genius to invent a machine to do this work. I hope that the day is not distant when every farm and every home in this land will have electric lights and when the wife will press a button and electricity will do the washing. I hope that in the future we will have machines tliat will do the thinking for some of the men we have in responsible positions in Washls]gton. We need more machines, not less, but the benefits must be dis- tributed to all. To that extent I am a technocrat. What, then, is the cause of this catastrophe that has befallen lis? It is ca vised by the monopolisation — not of the wealth of the coimtry but of the medium of exchange — the monopollssatlon fn the hands of a few financial monarchs of the money of the coun- try— the unit of exchange. This was brought about by a skillful manipulation of the currency, by monopolized tariffs, by gambling In stocks and bonds and the necessities of life. It was broiight about first by virtually doubling the money in circulation through the Federal Reserve bank during the war and then by a cruel, brutal, and inhuman deflation by virtually cutting the money in circulation in two. When we ent«r«d ths World War our financiers had already tet on the wrong horss over in Europe to the extent of billions of dollars; they bad given the allied govemmsnts credit for war ma- terials, food, and clothing to that extent. Preatdent WUaon real- ized that in order to win the war the Government — tn other words, the people of this Nation, you men and women — would have to assume that indektedneas for which our financiers had given credit in the way of war materials, food, and clothing to the allied gov- ernments. That is how our foreign Indebtedness arose. Our Government never loaned a dollar directly to the allied govern- ments. It merely gave them a credit, and the international bank- ers manipulated that credit In such a way that they got billions of dollars out of the $23,000,000,000 of hihmXy bonds we bought, and the United States Oovemment — which means \is — wee sub- stituted as the creditor of the allied govemments In place of the international racketeer! that bad bet on the wrong hoeee. If these intematlottal CKmblers had not t>et on the wrong horse to that extent, this Government never would have gotten tnto the World War. It would have been over before we got started. President Wilson knew that in order to win the wmr our Government would have to sell billions of doUare of boode. He knew that there was not enough money In circulation among tbe people to enaUe them to buy theee bonds, so he eucgested to the heads of the Federal Reeerve bank that they increase the money by issuing Federal Reserve notes and putting them in clrculaUoa among the people. Thereupon the local banks throughout this Nation took yoxir note and my note and Tom. Dick, and Harry's note, stamped on the back of them " payment guaranteed ", put them in a nice bundle, sent them to a Federal Reserve bank, and received Federal Reserve notes, dollar for dollar, in exchange. At the time that we entered the war there was In circxilstlon m the United States approximately $4.000 .000»000. It Is estimated that one billion of this was in foreign nations, that another 600 million had been lost since the Government began to make money, some 156 years ago, lost in the fields, destroyed in homes and buildings that have hiimed, leaving about 2>^ billion dollars in actual circulation. This was increased during the war to approxl- mately $6,700,000,000. In round numbers, the increase or infiation was approximately $2,000,000,000; the circ\ilating medium — money actually in the United States — was more than doubled by the issuing of Federal Reserve notes. With this additional money, with this extra $2,000,000,000 as a revolving fund, we bought $22,000,000,000 of Liberty bonds, bought new farms, new homes, and made countless Improvements. There was plenty of money with which to measure the muscular and brain energy of our people; prosperity was almost universal in this land of oiuv. and we had the highest standard of living of any nation. But disaster was awaiting us; in 1920, while Woodrow Wilson was a sick man, the international bankers stole the Federal Reserve bank; suddenly and without warning the Federal Reserve bank began its deflation policy; it suddenly and without warning called ufKsn your local bank, my local bank, and Tom. Dick, and Harry's local bank throughout this Nation to pay these notes they had guaranteed. It was at that time that your local bank was compelled to call upon Tom, Dick, and Harry to pay those notes it had guaranteed, and it was at that time that the prosperity of this Nation was wrecked. It was at that time that the price of the farmers* wheat went down from $2 and $3 a bushel to 80 cents; it was at that time that the farmers' steers went down from $125 apiece to $25. By the end of 1921 the Federal Reserve bank had called in approximately $1,000,000,000 of the Federal Reserve notes that it had issued in exchange for your note, my note, and Tom, Dick, and Harry's note. The first industry to feel the effects of this deflation was Ameri- can agriculture. The farmer, being unorganized, was the first to fall victim to the deflation. He was virtually slaughtered. He was made the shock absorber of deflation; and had he been able to carry the burden the entire cost of the World War wotiid have been thrown upon his shoulders. But. as usual, greed knew no limit — the load it placed upon the farmer became intolerable, and he broke down under it. Most of the farm indebtedness was created during the World War; during the period of inflation when there was plenty of money to measure the muscular and brain energy of our people: when everybody was at work and when prices were high. Before the price fixing act became effective and prior to deflation the farmers were getting as high as $3.88 per butfiel for no. 1 dark northern wheat in Minneapolis and other agricultural products were seUlng aceordln^ly. At that time a thwwand busheU of wheat would have paid an indebtedness of $3,880. Today. 1.000,- o6o. 2.000.000, or 3.000,000 busheU of wheat will not pay that same Indebtedneas, because the farmers are selling It far below the cost of production. What U true of ertieat is true of practically all agricultural produ^. The eelUng peio* of praetteaUy aU ap4cul- tural producU since 1922 has been below the eoet of i^oductkm. As a result, one may start from the Canadian Une In tbe State of North Dakoto and travel south to the OuU of MeHoo. eroeslng the States of North Dakota. Bouth Dakota. MebnMka, Kanaaa, Oklahoma, and Texas, and aU along the Une he wlU eee deserted farm homes, broken fences^ tumble^lovn bams, unpalated bouaee in sad need of repair — tlie very surroundings bespeak poverty and despair where once there was ptoapuritj. hope, and plenty. He will learn of hundreds and thousands of mortgage foreclosures, past and pending: he will meet hundreds of thousands of fathers and mothers whose sons and daughters have gone into the already overcrowded cities: be will hear from their lips tbat before tbe period of deflation they were worth from 828XMW to $»OJOOO, tmppj. prosperous, and contented, and now have eltber beoene tOTunU or are sbout to be erleted. with no plsee to ao. Tbs special of OongrssB did nothing worth while for peofU. I; 11 182 CONGKESSIONAL RECORD— SENATE NSttC B tlie Bach ft epudltton affecta not mOy the faruMn. toutttia M a wboto. It U a naUonal calamity — it U a diagraca to twentieth century and can only be explained by a compicie kreafcdovn — no; by a complete bankruptcy at pc^tlcal and e-*- Bcmlcal leadership. We have an overproduction of Just • ^twg to the United States— and that 1b an overproduction (operabundance of Ignorance on fundamental lasues. We h heard of abort selling, but one thing is sure — as a Nation this depression, we are long on short thinking. We have at our Angers' tips all that Is necessary to bring ab< the greatest prosperity and happiness that thla Nation has e seen. We have too much to eat, so much that one half farmers of tlils Nation have lost their homes, and the other I are about to lose them In producing it. Again, we have so mi -raw material of every kind and description that we do not ki what to do with it: and yet. we have millions and millions i billions of human wants. There is hardly a man, woman, or cl in this land that does not need some new clothing or other nec^ altles. and then there are 13.000.000 men and women out of ( ployment who are eager and willing to take this raw mats and make It Into ftnlahed products for us: and yet, the g: American engine is stalling. Then what is the trouble in this Nation? The trouble is have not enough money in actual circulation to measure mxiscle and brain energy of our people, and we have done nothl^ up to this time to remedy ^e situation I win ask my conservative friends: What la money? What Its purposes and its functions? Money is not gold; It is silver. Money as such has no intrinsic value: it Is a unit of change, a measure of values, a common denominator with we measure the comp.aratlve values of commodities: It is a stick with which we measure the comparative values of the thln^ produced by the energy of a people. Money is made by demonetize gold today and remonetlae sliver, and gold would worth less than silver. Of coxirse. the International bankers w^t the single gold standard, because they can and have monopoUz^ tt. to the misery at millions and aU but the destruction of Nation. The gold standard Is the result of a superabundance of anoe on the part of the former lawmakers of this Nation. Uncoh ■doualy and under pressure these lawmakers were gotten the control and Influence of the International bankers. It the international bankers that originated the phrases money ", " flat money ". "Inflation ", and " debasing the currenc; These are the phrases behind which the international bankers Wall Street have fovmd refuge and perpetuated a system that is a disgrace to an Intelligent people. Let us now come to the remedy, the Prazler bill. The bill provides that the United States Oovernment shall existing farm indebtedness at 1>^ -percent Interest and 1«4- eent prlnclpcd on the amortization plan, not by issuing bonds by Issuing Federal Reserve notes secured by the best on earth, first mortgages on farm lands, better security than or sliver because you can not eat gold or silver, but you can the products that grow on the farm, therefore jroxn: life upon the farm: it is the best security on the face of the ear1|li li our Oovernment has enough intelligence to do this, it make a profit of $6,345,000,000 at l>/2 percent interest in jean, the time required for amortization of the farm indebtcil Baa*. This bill asks nothing new. During the war the Oovetn ment virtually doubled the money In actual circulation by lasui ig Vaderal Beserve notes, secured by commercial and agrleultufal paper — prcualaaory note* — endorsed by the local banks. Since war the Gowmment has scaled down and refinanced the Indebt^l neas of the allied governments so that on an average tt amotmta less than 1 percent interest. The Oovernment has printed MI lion 900 million of paper money and given It to the banks ■even tenths of 1 cent per bill, secured largely by bends — the •mment's IndehiadneM. Why not refinance the farmers at Bnroent seeurcd by better security tban debts, by the farms of atlon? When the rrasier bill becomes a law then there will be 1 are nst ei- whlirh yarl- aln?i lav oe oir Igncr under SOU] td ajid monetary PraslBT reflnan» -p«r- bit securities gold 1 e»t depenls nh. wlU 17 tie 1- to 4 at o«iv- t^u lastisd put into etrctilatlon, among the people, several billions tfollara of new oioney- -Federal Reserve notes. It will again pttrehMfnf power to the people: the farmer will flbf his iMnl Bla nerctMitii, his lawym. and his dortor, and ihtf in tttrn will i^i Ibelr bllle, ami all will start in again repairing afMl Hiibroting thk» tiomet: unrnnpieymtmt arkt etaitstion will MMt, ih« tfffof{e. U U amendment had become a law. it would not now be necesrarjr for the Department of Agriculture to out-Sang«mplo/« mont, otd'age penxlono and »ti/'h t>ih*>f rpn^iu»bin relief l«H(iMltv« timi ae In Wf7fllmMfHle'1 Hf firftsiil/^d inUtif t» I'tttf ttf iniUi^mM >ti ufi#mt>t'/y«l ^hf ikH gl¥« Ihem »u upptrnunily Ut hmlni nmni tttt lUpht^i^ff P\nnUf, we t0*''tmtn¥tnt «l*«i ptmmc.t i/f the PnUnutt Mil ilt*' p«V' m«nt ut the mfUH»ti ptimpphtumth in m*»u, twl hy >«*Mm« h<'<»4ie bi^t b|r imuinu 'i'fimtmrf (»i/ia<« 'iHttttm im/Um» tmn Im isd'amct wuhin » lew ream wntumi sny int^roaM in tMtM"« 1^ »iiy\ynii iHe mtmey atidumuiated mmi tuuiufuuitniu^ un Um vaisiitiMi m*uri»iMJ« polivim, tutfittlMr wttn that tuiw umU m payment ut prsmiutn* <^ii theut pult(;te«, During tho specinl sesulon of Congress I wlttieb*«d cflveral hun- dred of our berui iftJd, tired, huuary. disheurt«»ed veterRns with U\» flag of this Nation marching by the House Odics Building with policemen directing them off the Capitol Grounds: and I caiui<^ help but think of the difference when these boys proudly marched forth to defend this Nation's honor and future glory; how we lauded and praised them then, ond what miserable and con- temptible treatment we have given them since and are giving them now. 1934 CONGRESSIONAL RECORD— SENATE 183 While thMe boy« went forth, willing to give their lives and their limbs fcr this Nation, many of the stay at homes wrapped the flag of glory around them and grabbed everything In sight. They made millions and billions out of the blood, the tears, and the agony of an agonized world. During the war we made 17.0C0 new million- aires and a few billionaires. But when these boys returned and asked, not for a just compensation but merely a few paltry dollars with which to get a start In life again, then we yelled that if they insisted upon that they would wreck the Nation; that the national credit and honor was at stake. The treatment of our soldiers and veterans during the war and since the war is a national disgrace. Quoting from the Chicago Tribune of May 21, 1920: " Every soldier knows the training camps were located not for training purposes but to bring money to favored ccramunltles. " Every soldier knows that of the money not deliberately mis- spent, fully one half was wasted, because it was administered by miserable incompetents appointed for political advantage. " Every soldier knows what an infinitesimal fraction of war- time expenditures ever reached the battlefield. " Every soldier knows that both his comfort at the rear and his safety on the battlefield was sacrificed. " Every soldier knows that throughout the war his Interest was sacrificed to that of the slacker and pmfiieer. " Every soldier knows that the only Gugpestion of national economy has been to economize at his expense." At the time that the economy bill was up. I suggested that so far as crucifying the veterans was concerned, it was false economy. I suggested you could not bring back prosperity by adding to human misery. I suggested that we should practice economy where it ought to be practiced. I suggested that we should give the President authority to suspend the Interest on the bonds of the United States for a period of 3 years. That would have put the burden of economy where It belonged — upon those who proateered and made millions out of the blood, the misery, and the tears of an agonized world. Why not in this crisis. If this Nation's credit and honor are at stake, suspend the interest on these bonds? To step the Interest on these tax-exempt bonds, I Introduced a bill in Congress creating the Bank of the United States. When this bill becomes a law, the $4,300,000,000 of papwr money now given to the bankers, largely to the International bankers for nothing, save the cost of printing, will be taken over by the Government of the United States and used as a revolving fund. It will permanently retire the twenty-three billion 4-percent Interest-bearing tax-exempt bonds, and save the Government and the American people over a billion dollars a year In Interest alone. The Interest thus saved In 2 years would more than pay the soldiers in full. In addition, the Bank of the United States would make a net profit over 600 million a year on doing the money and credit business of the Nation at less than 1 percent Interest, thus saving to the American people several billion dollars that they are now paying In higher rates of interest to the inter- national bankers. In conclusion permit me to state that the public and private debt In this Nation Is about $250,000,000.000 — the total property in the United States — I mean physical property and not debts — even at the high values of 1019. was estimated at $146,000,000,000, and Is now worth about $70,000,000,000. How are you going to pay $250,000,000,000 with $70,000,000,000? It cannot be done, unlew we first put more money into actual circulation — not by doubling it In the hands of a few International bankers and Wall Street racketeers, but by putting It In circulation among the people of thtfl Nation. Call that inflation or debasing of the currency, and make the mont of It; It will nevrrtheleno be a blesBlng to the people of our Nation and of the world. We are more interested in not debasing American manhood and womanhood. There must be on Immediate expansion of the currency or the Blue Eaf.le will be the bluet-t bird in America. We suggest to the Preside:.! that he give us a rational expansion of the rurrency by remonftirlni} silver by Executive order under thf provisions of th« law pBS'ed by the Npeclnl ner.Alon of Co:ii;rf«is, and that h« expand th* currmcy tindir olhpr provisions of that law. To th4> farmers of this Nstton I will say Ihat they will nev«r n»t jiistle* at thp hands of Congress iinl<»ss ibey f«*»p«rat* and rffati' l/#. I, th^frf/if*. siiittipst thst Uii'y join thi? fttrmtitii' Union, who«# ttatlonal |jr»"»idi»n», John A Stmpwtn is on*" t/f ih»> f#al nfMt mptt Hi I his t9ni\itti Mk is (tti¥ itl ihf rpn\ tuttn issrtprs who h#v#t ffUm"n (If sKfti^mW* n Will of m*fM> om^'iai Of tt«»HilMSM ih WMiHf»r»*>«i ihtUh A MMm|»«oi ri-pf'Sfiits iht> iw>bs hm4 Ms|MMilof« of hi Isasi MA imf^fyi 'tt sil ihs fttrm^rn iti ihis nntuth, nun >»M»f»fw»fs U\» tt\0tni» 1(1 ihti ttitiUittf nihtum ih* iMtsiHNss Miwl profsssloOMl Htnu snd w«MfM>M Mis mtmiUW ladio MiMritssos nr* t^tmnrh swHt<«d Mi»4 liw Ui>»«d ui Miid dis«i iteiung to (110 hiifh -ssiHrtod, tHH^nutakinu, tuK'tntttm t>rii;«4« of ao'OHllBd "farm Uadors", ond i« riot a "yits" man. v»rm»rti throughout this Nation Jnin Uxa ParmorN' Untun- ori{aniR« a local In your community today. Kur all Iniitructioiui writa to E. B. Kennedy, becreiary of the National farmers' Union. Kankakee, III. To the veterans and to the workingmen may I eay cooperate with the farmers of thie Nation, and eupeclally with the Farmers' Union. This organization Is and has been your friend through auuahlne and through rain. SOVIET RKCOCNinON — RADIO ADDRESS B7 KATTHBW WOU. Mr. KINO. Mr. President. I ask unanimous consent to have printed in the Record an address on Soviet recognition delivered over the National Broadcasting Co. network on December 2, 1933, by Matthew WoU, vice president of the American Federation of Labor, under the auspices of the American Alliance of the United States. There being no objection, the address was ordered to be printed in the Record, as follows: SOVIET REx:ocNmoN — rrs implications I am not optimistic as to our new relations with the Com- munist Government of Riusla. Pleasantries in Washington have not changed the character of the Soviet Government. The pledge given by Maxim LitvlnofT has not divorced the Third In- ternational from the Russian Soviet Government. These two and the Communist Party of Russia continue as the three joint ele- ments of a unified communist control In which each of the three parties is Incapable of independent action not In accord with the pit>gram and desires of the others. It has been said that the United States secured from the Soviet Government terms more favorable than those given to any othw nation by the Russian regime. That may be true. I have not studied all of the other Russian agreements. We are coDcemed with what Is In this particular agreement, not in what may be In other agreements. This agreement, frankly, does not assure harmonious relations with revolutionary communism. As a matter of fact, as long as communism is communism, as long as Its philosophy remaliis what it has been ar.d what It la bound to be, the conJllct between communism and democracy must go on. They cannot stop It and neither can we. To think of it as stopped by an agreement signed by two men In Washing- ton is to forget all of the lessons we have learned and to over- look all of the facts available. There Is in the Lltvinotl agreement no promise to repudiate the communist philosophy, no promise to repudiate the doctrine that it is a communist obligation to deceive the rest of the world, no promise to repudicate the Third International, no promise to cease doing any of the things that have made commtuilsm the enemy of all the rest of the civilized world. There is no promise that raids on world markets will cease, no promise that under- ground methods will not be used to achieve those ends whielt may not be achieved openly. There is even no repudiation of the Moscow order, published in America while LitvlnofT conferred In \^ashlngton, and which order was published in Moscow on Mon- day, October 23, by the Central Office of the Communist Party of the U.SJS.R.. 2 days after the publication of the correepondence between President Roosevelt and President Kalinin. Omission of any reference to this Moscow order Is all the more remarkable because of the bitter attiick made In It upon President Roosevelt and the N11.A. program. The fact that the American Federation of Labor was likewise attacked may perhaps be of little importance to some. This document was headed " Roosevelt Starvation Program." It was printed In several languages, in the printing plant of an ofBclal soviet organ, and its text was officially approved by the Soviet Censorship Bureau. It was addressed to communists and revolutionary groups in the United States. It contained detailed orders and Instructions to oppose President Roosevelt's program, to exploit the wave of discontent, to convert this discontent Into a gigantic struggle of the proletariat against the Government, to formulate the plans for a counter-revolutionary program with- out delay and Immediately to Instigate open revolt*, flghU, and strikes against the administration's measures. It Is clearly evident that, regardless of recognition, regardlees of promises given and pledges made. Soviet Russia is a* de- termined as ever to create internal strife within our Nation and to foment world rrvolution. Instead of changing h«r tactics, in view of the recognition agreement, Moscow Is pursuing her tradl* tional tactics with renewed vigor and determination, Perhaps the President had no recourse other than to rt-cogniM tovift Hiissia. Perhaps there »tt unknown circumstances tliAi requifixl Mbendonment r>f the poltrv laid drrwn hy his dietiii* guishi^ tMftnaetniie pr#d«re«eof ana adhered U} by ell ot th« intetvetiing fiepublicNhs. fertiips thttp were tptumtw Utt reeefnl* iSttn whl^h 'Mitweighed ei this tim<> Alt r*f the r»flglti«l ftMl nil «f th#" »/vumiili»ied fMiMths im 4sNyif)N >ecogfiitl'^ Hut #v*f» »/ wt f'ttwptt^ iitwi ihffP hnH U« fm reffigniti/m, ife fUt tuH hMVe Wf t*'mt>¥4* Ihti thsfx Is hniUHtH tttHfn t'l Wttfff »hmtl< WH«i I w»ht Uf ptttm itm is ih»i Ui* utu* tiff wttrrf nM imi ^un li*4 I )»e(ieve vtmmuuM fff»P*m»ttn4 wMi ft^umf whmi •seunMlly I (Ut fuft I am (itmMfm iWr« will He Hiefiiy (rf Mtmmunm pf9fHK{«f>d», urititfui m Mflord witH ih« umMtw pdiurn m>»4 dir<«isd hy th« man* diKtatufi«l Uinui ih»t rules U\» dsstiiiie* of l^mOAiXi (inklaved p<»4> liest of feetinifs aud warm^H of friendships. Now is th« time of our testing. We lu»ve opened the dour, and eomethtng Is bound to enMr. I urge, with all the emphasis of which I am eepable, two thingst First, that before loan^ are made to the Soviets with whleh to finance purchases of commodities, that our loaning capacity to our own people be exhausted and that extension of national credits on our part be denied where we know such flnancUl assist- 184 CONGRESSIONAL I^ECORD— SENATE ance wUl prove the ultimate disruption of the economic We of every other nation Second, that our Department of Justice be given the authority and the funds with which to observe the secret operations of commrmlst in our midst. As to the fL'st point, let me say that we still have millions of \inemployed among our own jjeople. I am not optimistic enough to believe that all of these will be employed this winter. 0\ir primary obligation is to them. I am opposed to sending our wealth to our enemies abroad until otir friends at home have been provided with enough. Then. too. it must be borne In mind that foreign trade in Rus- sia is a state monopoly. The whole industry, commerce, and activities of Russia are nationalized. The nature, quality, and prices of exports are decided by the state alone, and in an entirely arbitrary manner. The basic aim of Soviet foreign trade Is the disruption of the economic life of what It chooses to call " capi- talistic countries ", and with the view of creating discontent and furthering world revolution. This was clearly manifested by Mr. LltvlnofT In his statement at the Pan European Conference held in Geneva when he said: "Owing to the special conditions at agriculture of Soviet Rus- sia, as well as Its monopoly of foreign trade, we are able to sell agricultural products 70 percent and even more cheaper than our capitalistic conipetitors." This statement and impMed warning were clear and definite. Russia uiMJerstands well Its power, and It Is well that we under- stand that the Intercourse between the United States and Russia is not only such as of countries engaged In mutual trade but chleQy as countries supplying the same market with Identical prod'4~ts. such as grain, oil. etc. Soviet Russia by underselling these products In Eiu"ope can and will impose irreparable Injury to our farming commtmitiea. Why, then, should American taxpayers' money be loaned to an Insolvent nation, a nation that is running constantly into the red and that has no regard for the ordinary conduct of decency observed by every other natior? American labor Is In complete accord with President Roosevelt In his utterance and attitude that it Is utterly and entirely un- sound to encourage a policy that would open markets In foreign lands through the lending of American money to these countries regardless of assurance or nonassurance of repayment of money so loaned. As to the second point. I wonder how many Americans know that our Government today has no authority to conduct even the most cvirsory Investigation Into the secretive and subversive activities of Communism. I wonder, too, how many Americans know that the underground Communist Party in the United States has never been disbanded. Must our people be lulled to sleep by every whiff of fair words? I am no alarmist, but I do believe It Is at times worth while to try to be a realist. I refuse to be fooled by Mr. Litvinoff, who is rated as the most successful of all Red diplomats. But If his success is to be o\ir downfall, why need we cheer him as he moves from victory to victory? ICr. Litvinoff evidently fooled many when he said the Com- munist Party of Ru&iila Is not concerned with the Communist Party of America. If that is true, is it equally true that the Third International is concerned with both and will remain so? If th«t la not true and If the Communist Party In America Is ac- tually diTorced by the Third International, then we shall have news worth the reading of all Americans. In this connection It will be interesting to observe If the Soviet Government will carry out the suggestion made by Dr. Bdmund A. Walsh on November 19. In his statement Father Walsh directed attention to the fact that an organization notoriously hostile to OUT country was residing on Soviet territory and housed tn a gov- ernment building not far from the Kremlin, and. therefore, not permitted to continue Its life or activities under paragraph 4 of the Washington agreement. He well asks if the pledges made by the Soviet Government, through its commissar for foreign af- fairs, will be carried out in this and other Instances. If the Wa&hln^ton agreement. In It? famous paragraph 4. means the severance of the tie between American communism and its Russian master, then let us have performance. Let it happen. It has not happened and. In my opinion, it will not kapp>en. because, as in a long list of cases, the Soviet Government has otuck Its tongue in its cheek and parrotted to the world. " the Russian Government does not control the Third International ". while all the world goes oil blinded to the truth out of its greed for trade. I thank God the American Federation of Labor has never given way to greed in this long con&ct of interests. We have been baited with the prospect of work, and we have needed work with an acuteneaa that can never be comprehended by those who have not needed work. But our ranks have never wavered on th^ Issue. It is a record for all time and a record of which we are proud. We have not been for sale. Our conditions have been above price. And we have not changed our minds. American labor is ever mindful of the fact that the Russian Communist Party Is the superior <]f both the Russian Government and the Third International. And Stalin is the superior of the three. He is the esar of Soviet Russia. The individuals surround- ing him are in ofllce and complete control of these three organl- cations. We behold a unity, with three interdependent and inter- locking parts. Should the Rixsaian Communist Party decide to tfiacoattniw the use of the Third International as its vehicle for the propaganda of world revolution, there remain to be used January 8 some 15 other Internationals. Including; first and foremost the Red International of Labor Unions, extending on down the line to the red youth International. All are of the one family, all bound to the same unholy purpose, all a part of the network through which communism works to accomplish Its destructive purpose. Now, from the viewpoint of the realist, why was recognlUon extended? Certain reasons seem evident, among which was tha desire to curb the ambitions of Japan. Another reason which seems evident was the desire to promote export trade and, at that particular moment, to give our farm population some encourage- ment. If, in the absence of full information, we must concede something of soundness to the first o'. these, the second Is, as I see it. purely mythical and. as I have tried to point out, m?.y ultimately prove extremely injurious to our farmers as well as other groups in our land. No person has yet been able to wring out of Soviet Import statistics any encouragement of the recognition policy, THiosa statistics have shewn vis clearly as could possibly have been shown that recognition covild gain us nothing in the way of new trade, even If our diplomatic policy were to be fixed on a basis so unworthy. It has also been said that recognition was extended as a matter of friendship for the Russian people. But diplomatic relations are not relations between peoples; they are relations t)etween gov- ernments. That and nothing else. To my mind, every reason that was valid against recognition 2 months ago, and during all of the past 17 years, remains valid. However, recognition has been granted and we have now to save ourselves from Its consequences. If we can, I do not have any belief that we are about to be destroyed. That Is the argument of our opponents who find It easier to destroy straw men than it Is to controvert facts. But I know that communist propaganda will continue, that recognition facilitates propaganda, and that nothing about the communist program, philosophy, or machinery has been changed, I think and hope I know enough not to be fooled by superficialities and the gloved hand of the Russian smirking diplomat whose object .is not to get something for the masses, but to achieve an aim of government. The Communist machine does not love us more today than 2 months ago. The Communist war against our unions is no less vigorous. The Communist Intrigue among all of our people Is no less stealthy. Is it not strange that when our Government opened negotia- tions with the Communists and likewise when It concluded them, there was not In possession of any department or bureau of our Government any evidence whatever of the operations pnd machi- nations of communism In the United States? There was no Infor- mation about what this alien enemy was doing among us. However, the die is cast. We are In friendship with our bitterest enemy. If this must be. then let us at least know what this enemy is doing. Let us not go forward In ignorance. One day we shall have to protect our democracy unless communism perishes from Its inner weaknesses. Let us run America for our own people and let us know what our enemy dees among us. for in knowledge we shall find strength when we most need strength. • • • • • • • nWXATION Mr. CLARK. Mr. President. I ask unanimous consent to have inserted in the Record an article appearing in Scrib- ner's Magazine entitled " Honest Inflation ", by Edward Tuck, founder of the Tuck School of Business Administration at Dartmouth College. There being no objection, the article was ordered to be printed in the Record, as follows: HONKST IKPLATION (By Edward Tuck, the founder of the Tuck School of Business Administration at Dartmouth College) The firm and Judicious resistance v/hich President Roosevelt has offered to inflation has a sound basis. He recognizes that merely to add to the already swollen volume of promises to pay can avail nothing against the day of reckoning when paper money comes to its ultimate redemption. The basis for the demand for Inflation rests upon the growing world conviction that the real cause of present economic conditions is monetary. To this ■' monetary morbus ". as Cernuschi called it, Is due the p;ei>ont collapse in prices, stagnation in business, and increase in poverty in all countries. A correct idea of the nature and functions of money In general Is a necessary preliminary to the proper appreciation of the merits of the conflict between bimetallism and monometallism which is now more and more agitating the commercial world. Money is an instrument of valuation, established by law, to measxire, compare, and exchange values, and to serve as a legal tender for debts. The material of money Is in principle unimportant, except so far as it Is liable to affect the aggregate amovmt in existence — the total monetary mass. The value (pur- chasing power) of money is Increased or decreased, ceteris paribus, in inverse proportion to its volume. Indefinite issues oi paper money create redundancy and depreciation. Comparative fixity or limitation of supply is therefore requisite to give reasonable stability to the value of money. Paper money can be increased in amount Indefinitely, at the will of the sovereign or of the 1934 CONGRESSIONAL RECORD-SENATE 185 legislators, while metallic money Is susceptible of only a limited and measurable annual increase, wbich distributes itself among the nations. Added to the total accumulated monetary mass existing throughout the world, this incret^e forms but a very small percentage, and serves barely to supply the needs of con- stantly increasing population, production, and commerce. For these reasons it is agreed that metallic money alone constitutes a safe standard of value. Prom very early days, gold and silver have been selected by nations whose civilizations are built upon trade as the world's money metals. Hence they have received the name of " the precious metals." It is the legal function of money that gives to the metal its great value. It is the legislator who bestows upon the metal this function. The legislator can withdraw the money function and thereby destroy the metal's great value. Hence the term. " in- trinsic value." applied to money, is misleading. Its value is almost entirely extrinsic. Aristotle says: " Money itself Is only a frivolity, a futility; it has value only by the law and not by nature inasmuch as a change of agreement among those who use it can depreciate it completely." If an example be needed to prove conclusively the accuracy of the great philosopher's conception of money, we have It In the monetary history of the last 60 years as regards silver. Bimetallism is the privilege of unlimited coinage of both gold and silver as full legal tender money, at a ratio of weight fixed by law. This does not mean, as some suppose, redemption, or con- vertibility, of one metal by or into the other. Both metals stand on a perfect equality before the law. In the United States the silver dollars and silver certificates at present outstanding — four hundred and slxty-flve millions in all — always stood at a parity with gold by reason of their equal legal tender quality for all debts. There is no good reason to doubt that the whole sunount of silver belonging to our Government, including the silver bul- lion, could be paid out — were specie payments resumed — In dol- lars or in certificates, and retained In circulation at par with gold, as was the case, prior to our going off the gold standard, with the silver dollars and certificates then outstanding. Turgot. the great economist, and minister of finance to Louis XVI. said: " Gold and silver are constituted money, and universal money, by the nature of things, independently of all convention and ail law." Daniel Webster said In the United States Senate, In 1836: " Gold and silver Is the money of the C!onstitution. The consti- tutional standard of value is established, and cannot be over- turned. To overturn it woxild shake the whole system. Gold and silver at rates fixed by Congress constitute the legal standard of value in this country, and neither Congress nor any State has authority to establish any other standard or dispose of this." Michel Chevalier. In the preface of his French translation of Humboldt's Gold and Silver, said: " By reason of the part which gold and silver play in all the transactions of mankind, in the contracts between States and Individuals • • • every important change in the value of gold and silver is a serious event, a sort of revolution." The correctness and wisdom of these views appear never to have been questioned until after the great discoveries of gold in Cali- fornia and Australia, at which time this same Michel Chevalier began to advocate silver monometallism. In 1859 he published his once famous work on The Probable Fall in the Value of Gold, in which he argued in favor of the demonetization of gold by reason of its enormoxisly increased production. Significantly enough, it was Richard Cobden who wrote the preface to the Eng- lish translation of thU work (published by Appleton in ia59). and In it reiterated Chevalier's statement that the production of gold had amounted In 10 years to about as much as the entire produc- tion of the world during the 338 years which intervened between the date of the discovery of America by Columbus and the year 1848. The gold monomctallists of later days have never had half so specious an arg\iment against the fitness of silver to serve as money as that argument against the fitness of gold. However, gold was not demonetized, and the historian Alison, writing at the same time and describing the previous distress and the subsequent prosperity, said: " The era of a contracted currency and consequent low prices and general misery, interrupted by passing gleams of prosperity, was at an end." Many writers on economics today cite statistics of deposits and prices compared with those of previous periods, seeking to prove thereby that the actual volume of gold suffices for the present needs of commerce and money circulation. If this Is the case, how does it happen that not a single important nation can pay its obligations, either of maturing bonds or of its demand notes. In gold coin? Even In Prance, nominally still on the gold stand- ard, napoleons are unobtainable except by purchase in the market at a premium equivalent to the price of gold In London. It was Cernuschi. the great master of monetary science In the past century, who developed fully the argument based on the dis- location of foreign exchanges and pointed out the disastrous con- sequences thereof to the industries of the gold-standard nations. He established the complete scientific theory of bimetallism and gave to It. in all modem languages, its appropriate name. The people begin to realize that the annual Increase in the pro- duction of gold Is not keeping pace with the expansion of the world's production of staple commodities, and especially with the prodigious Increase in existing debts. Chief among these debts are those of the governments of all countries in seeking to supply the deficiency of metallic money by vast issues of paper promises- to-pay money " on demand ", which are universally dishonored. but to which the paper inflaUonuta Insist the United SUtea shall add stUl further. This world-wide paper-money Inflation exists today to an un> limited excess and with augmenting depreciation In coin value. Under these circumstances what the world must now h»ve to enable it to carry its burdens, to save It from general repudiation of debt and universal impoverishment, to raise prices, and to stun* ulate commerce and enterprise Is a virtual doubling of the annual supply of additional real money, furnished not by the unlimited capacity of the printing press but by the combined mines of the precious metals, both gold and silver. Until 1873 the coinage of both metals, at a fixed parity, as legal tender money was free and unlimited In the United States and In Prance. Srery suooeaslTe large increase in the production of either or both metals brought Increased prosperity and wealth, as. for Instance, the gold dis- coveries in the Klondike and the Band In the late 1890's and. earlier, the Comstock lode In silver. This Increase in the coinage of both metals, with Its vivifying power, was never considered money Inflation. It was. In fact, ttaa supply of a needed expansion of basic metallic money for increas- ing population and commerce. It Is matilfest today that gold alone does not suffice to satisfy this constantly growing need and thereby the world Is now threatened with flnandal ruin. To the demonetization of silver, first by England In a fit of extreme insularity after the triumph of Waterloo, and subse- quently by the United States. Germany, and (In consequence) Prance, may unquestionably be traced the present universal col- lapse. The eminent American economist, Prof. Francis A. Walker, author of a standard work. Money, published In 18T7 and 1891. declared with emphasis: " The history of the century would be searched In vain for a political blunder of eqtial enormity." Fully 60 years ago the most acute and erudite students of mone- tary science warned the world of the Inevitable consequences of this extrusion of sliver as a Joint monetary standard with gold. In the month of April 1870, Wolowskl, a distinguished TTfnr- mlsnoD ler nane psr- aa or Br^an to of mciire- agr ec- topia; CGtn filed lol- sec ire flac- Aldrjch, E. ^Bdltor's note: These Senators were primarily representatives of Bastem States and conservative Interests, as may be seen f^om following Identification: John Sherman. Republican, Ohio. Secretary at the Trea^nry under Hayes. Secretory of State under McKlnley. The Sheman Act (1890) was a compromise bill providing for the purchase of four and one half million ounces of silver per month. Treasury notes to be issued in payment. In 1893 the Voorhees bill repet led the silver-purchase clause but afllrmed bimetallism as naticpal policy. Nelson W. Aldrlch, Republican. Rhode laland (1881-1911). Au- thor of the Aldrlch plan from which the Federal Reserve Act Was evolved. Senate leader for many years. Shelby M. Cullom. Republican. Ohio (1883-1913). Cooomlitee of which he was chairman created Interstate Commerce C^m mission. W. B. Allison. Republican. Iowa (1872-1908) . Member of Flnaiice Committee of Senate for 30 years, identified with Bland Silver Act. Involved in all currency dlsciissions of period. January 8 Chandler. D W. Voorhees. Calvin S. Brlce. George P. Hoar. O. H. Piatt. A. P. Gorman, and David B. Hill. ^ ^ ^^ Between that year. 1894, and 1900, Bryanlsm. aided by the Republican campaign, completely perverted public opinion regard- ing silver, and It still so continues. In March 1871 the Franco-German war was ended. Prance paying In gold a war Indemnity of 1.000 million dollars. In the following July the German Empire, which had previously been on a silver basis, established, after the example of England, a national gold standard, limiting the existing aggregate Issues of silver coins and requiring that the sliver In excess of that amount should be with- drawn from circulation and sold The French mint, which under the bimetallic law of 1803 was obliged to exchange the two metals one for the other on demand without limit, became alarmed lest it should be overwhelmed with the German silver and at once slackened the coinage of silver, ultimately entirely abolishing It. Then, and then only, the decline in the price of the metal silver from the legal parity began, as shown by the statistics of all mints, reaching in 1932 the lowest figure on record. This continuous fall in the price of the metal was caused not by its overproduction from the mines but largely by the sale In the open market of demonetized monev from different nations. Including Prance. The yearly product of the mines since 1900 up to 1930 has been esti- mated In fine ounces as from 8 to 13 times to 1 of gold. In fact, the production of sliver compared to that of gold has not been as high as 16 to 1 for nearly 40 years past, and of this pro- duction 80 percent Is estimated as being the byproduct of other metals. Money has never been defined as a value In Itself but only as a measure of value. It has been called " a vehicle to faclllUte the exchange and distribution of the wo? Id's products." The smaller the nimiber of those " vehicles ". the larger naturally mxist be the load put upon each. This In monetary language means lower prices of all values. That Is the situation of Europe and America today. The vehicles are overloaded, and the number of them must be greatly Increased. To carry on commerce between the nations of the world there needs to be an International unit of value, and that unit must be a metallic one. During our Civil War, European currencies being on a gold basis, while the United States had a depreciated paper money, our foreign commerce was regulated through the " gold room " m New York, where gold was bought and sold to supply the needs of foreign commerce and dealings In securities. Following the Civil War and prior to our resumption of specie payments in 1879. the exporUr of cotton sold it at a gold price in Liverpool or Havre, and bought It In New Orleans at the greenback price. Hence he was a seller of gold, while the Importer of merchandise was. for the same reason (reversed) a buyer. At the present time, no nation on either side of the Atlantic having a currency redeem- able In gold, all foreign commerce and exchange dealings are In the greatest confusion. No man knows from day to day what may be the market value of his merchandise or of his Investments. At the recent economic conference In London. President Roosevelt was severely criticized for refusing an attempt to stabilize the moneys of the United States and England, but he was right. To try to do It would be like an attempt to stabilize two balloons. Metallic moneys can be stabilized by their proportionate weight, but not so the unlimited products of the printing presses. It Is only from the mines of gold and sliver that there can be fur- nished automatically a needed yearly additional supply of metallic real money, which Is estimated at from 1 to 2 percent of the exist- ing monetary stock. In the great debates on bimetallism which took place In the United States and in Europe during the latter half of the pact century, both Democrats and Republicans were members of the different monetary conferences held in London and in Paris, with a vle^ to the restoration of bimetallism by irternational agree- ment. The United States was then a large debtor to Europe. For this reason It was believed by the majority of our delegates that sliver could be restored and a stable parity of exchange maintained only by an agreement between the United States. England, and France. Today, the United States, having become a creditor nation with immense increase in wealth and power, is abundantly able to solve the problem alone. I venture to predict that if bimetallism were adopted by us, the course of events would force the acceptance throughout Europe of silver money on an equality Heniy Cabot Lodge. Republican, Massachxisetts (1893-1924). Senate leader for many years; headed fight on League of Nations: chairman of Foreign Relations Committee of Senate. W. K. Chandler. Republican, New Hampshire ( 1887-1901 ) . A " war " Republican, Secretary of Navy under Arthur, credited with tactics which brought about election of Hayes over Tilden. D. W. Voorhees, Democrat, Indiana (1877-97). It was his bill which affirmed bimetallism as national policy. Calvin S. Brice, Democrat, Ohio (1891-97). A conservative, large railroad and banlcing Interests. George F. Hoar. Republican. Massachusetts (1877-1904). mous Senate leader, had large part In framing bankruptcy antitrust legislation. O. H. Piatt, Republican, Connecticut (1879-1906). A. P. Gorman, Democrat, Maryland (1880-98 and 1903-06). rected Cleveland's campaigns. Outstanding Democratic leader. Swung Democratic votes for free silver in return for silver Re- publican votes against Force bill. David B. HUl. Democrat. New York ( 1892-97 ) . Succeeded Cleve- land as Governor of New York. Author of the phrase, alter Bryan was nominated. " I am a Democrat still — very still." Had Fa- and Dl- 1934 CONGRESSIONAL RECORD— SENATE 187 with gold at the American ratio In protection of those nations' own commerce, especially In connection with the Par East and South America. The world-wide price of sliver would advance to whatever legal parity, whether 20 to 1 or 16 to 1, was established by the United States. The debt -paying power of silver becoming equal to that of gold at the legal ratio, nobody would part with It at a lower valuation. An advance of price in all commodities would at once ensue as the result of the increasing supply of real money. We see already the beginning of this \ja the higher prices which have accompanied the late rise in the price of silver. The world Is now ready for the remonetlzation of the metal, which would be followed Immediately, gold and silver standing on the same plane as monetary units, with buoyant markets everywhere. On the other hand, increased issues of paper money in the United States can have no effect on world markets, creating only redundancy at home and increased depreciation by comparison with the nominal gold equivalent. The United States cannot be willing that Its money issues should follow crlty of a doaen years ago. Any fair sotlmstf of the International monetary problem afust recognlar that for a world such as ours. operaUng usdw chaa^i^ ooodiUona of modem Ufa. the available supply of Is not sufficient to form the basis of an sdequata world currency January 8 To add silver to this metallic base Is to bfulld a firmer foundation for a world monetary system. ^ ^. _, _« There are those who will claim that the production of sflver may be violently Increased by raising the price of silver. The answer that the silver advocates make is that there la a definite limit to the production of silver, and, while estimates vary as to the amount, a fair view of this question indicates that the possible production of silver Is not beyond the limits of safety. Even manx conservatives are now willing to admit t.hat the time has passed when gold can be used as a private circulation medium. It is probable that in the future economy of the \«.orld the metallic basis of the currency— and it is to be hoped that it will consist of both gold and silver— will be held as a Government possession or be used in a limited degree in settling international trade balances. This practically destroys the argument of those who fear the operation of Gresham's law. It also makes allowance for the enormous importance of credit in the monetary picture. The action of the President is a substantial vi' tcry for the moderate advocates of silver. Senator Key Pittman has reason to feel a measure of satisfaction in this practical result of many yeai-s of advocacy. All fair-minded observers in this country and ths foreign experts who gathered in London recognize that no one In the world has so mastered the details of this subject as has Senator Ptttman and that no one has appUed his knowledge of his favorite subject in a more statesmaniiKe and reasonable niaiiner. Rayuono Molet. THI CALENDAR The VICE PRESIDENT. The morning business is closed. The calendar under rule VIII is in order. The first business on the calendar was the bill (S. 682) to prohibit financial transactions with any foreign govern- mert in default on its obligations to the United States. LETTER OF JOHN MAYNARD KEYNES TO THE PRESIDENT Mr. LEWIS. Mr. President, I beseech the Senate that I may be permitted to impose upon it for a few moments on a matter that may be slightly a departure from what the calendar calls into action. I refer, Mr. President, to a pubUc letter which has been addressed to the Presidsnt of the United States, which comes from one who signs himself John Maynard Kejiaes, an economist, and seemingly has authorized those who are presenting the letter in the press to allude to him as an " adviser of one of the King's col- leges " and a " director of economy." Mr. President, this eminent gentlemwi— I say " eminent " because he says he is, and I am one of those ever inclined to adopt a man's standard as expressed in behalf of him- self— addresses his letter to the President of the United States. The letter assumes to have been written from London, England. This letter would not have attracted my consideration or the attention of my eminent colleagues on both sides of this Chamber were it not for the fact that It- is perfectly apparent that it Is a sjntidicated article, prepared at the behest of those interested, and circulated to be printed in the different magazines and publications of America as a declaration and expression from a very eminent source making an estimate of the President of the United States, the Government of America, and those who are assumed to be its advisers and directors. Our attention is drawn to the fact that one of the great papers of New York, the New York Times, assumes an im- portance for this communication, and extracts from it in the usually able manner characteristic of the New York Times, and addicssco in its editorial its cnminents as to the admin- istration in power, and takes the extracts from this economist of England as the basis of this comment and as the justifica- tion of its conclusions. I have noticed that a very great paper of the West, one of the very great leaders of expression of one of the great political parties of America, the Chicago Tribune, simulta- neously adopts portions of the communication and expresses itself in harmony with its declarations. At the same tune. I advise my colleagues interested in this casual matter, the influential San Francisco Chronicle reproduces from this let- ter an extract and likewise editorializes upon it adverse to the administration. Senators, it is very evident from these reproductions that this communication was prepared some weeks previous to its date and, through the selected agencies of power, was laid upon the table, ready for action. It was to be pubhshed simultaneously in all parts of the United States, the object 1934 CONGRESSIONAL RECORD— SENATE 189 of achieving a basis of comment, censure, and condemjiation of the administration in power. Mr. President, ordinarily this honorable body would pay no heed in an ofiQcial manner to communications addressed by gentlemen of foreign lands either adverse to or in favor of an administration in power, and that would not be done in the case of this communication but for the fact that it is written with the object of impressing the American public and influencing the American nature to adopt the premises set forth and to endorse the conclusions reached. I dare say my eminent colleagues on both sides of this Chamber recall the name of this eminent writer. Mr. John Maynard Keynes. In the estimation of a few of us who participated in some capacity in the peace conference at the close of the World War — my part being of a minor char- acter— it is to the credit of this gentleman that he very early saw that the reparations laid against Germany were of such weight and burden that they would distress, rather than advance, the cause of peace, and he did assert that it would obstruct any negotiations of harmony in the coming era between the nations. Later this gentleman, as an economist, assumed to be a spokesman of the younger generation of England, who in themselves were at variance and sometimes in conflict with the older age of England as it expressed itself in Parlia- ment. To that point he was very much commended by those who have such views as myself, and received the en- dorsement of those whose modernistic ideas of the advance of human liberty and common justice would reward anyone who was daring enough, courageous enough, to advance remedies as against the oppressions which were then threat- ened and now are imposed upon the world at large imder what is called the terms of the peace treaty. Up to 4 months ago, as we recall, if we are interested at all in the casual history of mankind and those who write from other countries touching the affairs of America, this economist wrote most approvingly of the attitude of the United States and found it agreeable to have — through what- ever agencies were adopted, I know not what — the print in America of his views. These expressed the endorsement of the policies undertaken by the President, the new eco- nomical doctrine of the United States, and the theories advanced by those who were speaking in behalf of the new government in America. I am assuming, sir, that those who spoke felt they were advancing the doctrines which were stated in the political platform of the Democracy and espoused and endorsed by the electorate at the election, producing the result now ad- vocated by the national officials who were chosen by the popular vote. It is to be noted now that four months and a half from that time this eminent economist — lest I fall into error— finds it wholly agreeable to write the very reverse of all of that which he has previously advocated. He seems to find an occasion for the condemnation of whatever has transpired in America, particularly as to that which relates to the Government and the administration from Wash- ington. It may be a bit unkind, but I dare say it cannot be said to be inconsistent or illogical, to conclude that something has happened wherein this honorable gentleman, this writer disseminating knowledge and information for the guidance of America and England, has been influenced in the short term of 4 months to such change of attitude and view as now indicated from previous advocacy, since these views to which I am alluding have now been given the currency of a public document throughout all the United States. It is hoped by its sponsors to influence the ordinary citizen of the United States. It is trusted that he may behold how very wrong has been the way of the administration, and how very great has been the loss to America in its pres- tige before the world as a result of the enforcement of the policies of the present Government. It is believed that these portrayals of our errors may convince our general electorate that some great wrong has been done the honor of the Na- tion, and for such reason, among others detailed, our people would be converted to reverse all of that n^ich was decreed at the ballot box. I am now to refer to the writings of another person, and he the subject of a friendly nation for whom we have great respect and whose officials we hold in very high esteem. I take the liberty of bringing the attention of Senators to the letter as I read from it, to which I add views of my own touching this letter and the decorum of its expression. I bring you first the letter. I bring you then the editorials in these great papers which have assumed to use this letter as the basis of their condemnation, their criticism, and par- ticularly their analysis and adverse Judgment of the policies of our Government. I turn to attract the attention of the Senate to the form of print of this letter. I invite you to note that the letter Is headed by those who espouse it as being from one who is a fellow of King's College and an adviser of the royal body in England. Mr. President, I wish it understood that I do not complain that this British gentleman addresses himself to the Presi- dent of the United States, and that this English economist attracts to himself such advertisement as naturally follows to one who assumes to have his people informed that he feels himself important enough to address the President of the United States as one of the fellows needing advice and counsel from such source of wisdom as the writer feels he represents. I do not complain that the gentleman presiunes as a citi- zen of the British Empire to address himself to the President of the United States, for I recall that there is an old English maxim of consolation that " a cat may look at a king." It is Danton who tells us that life's text of action Is " L'audace, encore de l'audace, toujours de l'audace." We read in this letter addressed to the President a con- fession on the part of the gentleman styling himself as " economist ". that he lays down his reflections under the " disadvantage of distance and partial knowledge." We con- fess that after reading his article, it is readily conceded that his knowledge is partial as it is also deficient. He states that the sympathizers in England are nervous and despondent. We are sorry that those In England can be either nervous or despondent, and trust that by reading this article those beholding it may take on some other form, such as confidence in their Government, and the con- sciousness that we in America are conducting our Govern- ment without regard to the nationals of other nations who have certain losses to themselves wherein they had from a policy hoped for — by us contemplated profit, and, disap- pointed, have become nervous and despondent. The economist proceeds to ask whether or not the Presi- dent is being advised by those he styles as " crack-brained and queer." We do not know exactly to whom he alludes, but, with proper regard to this letter, we answer him, " Yes; it is apparent from this communication addressed to the President by the alleged economist offering advice that some of the advice is surely crack-brained and queer." He states that the average city man — meaning the man down in the city of London close within the shadows of the Bank of England, for, as Senators know, that is always re- ferred to as the " city ", all portions beyond as England— that Ukose within this environment feel the President is engaged in a harebrained expedition in the face of opposr ing competent advice. Of course, we assume that the com- petent advice is that which comes from Britain, cmr honor- able competitor, for whom we have the best of wishes and great hopes. But this writer advises the President that the only hope of the President lies in " ridding yourself of your present advisers " and to " return to the old ways, otherwise the United States is heading for some ghastly break-down." Oh, the horror of it. Of course, it is easy to observe ttiat returning to the old ways means those ways that surrender the dignity of the United States and Its Independence to those of other nations who profit greatly by our supine surrender or serene indif- ference to their impropriation of profit gathered from our too frequent yi^ding our priyileges and our advantages. 190 CONGRESSIONAI and iiMiavuzn RECORD— SENATE January 8 The emteent economlKt m-oceeds to mdvtee the Preaj dent by saying he is about to overtask his boreaucratfc machine, and states: Now I am not clear, looking back orer the l««t » month*, th^t the orter of urgency between meaauna ir«lon of the eminent economlit th»t the "American dollar in ttyrating to and fro like Nomething on a • booze ' " and a«k. Why is nothing »ald of the pound which has been for some time gyrating to-and-fro like a fcmall boy'i balloon under the caperlnu wind, or a manikin aflllctcd with 8t, Vitus'* dance? This eminent economist Is unconscious of this, apparently, for it is to be hoped that only through uncomclousness would he have omitted al- together a reference so pertinent when he makes applica- tion of his criticism to the American dollar, which has, like Shakespeare's description of the North Star— fixed in per- manency— as is no other fellow. Mr. President, I now beg. sir. to impose upon my col- leagues by asking them if they will hear my address to this eminent gentleman. I turn to this eminent economist and the scientific analysis that he represents as personified in himself, together with the conclusions of finance and the logic of government which he feels he tenders to the Presi- dent as a Eure guide of the course of our Nation to protect it against unemployment, and we ask. Will he not observe that on January 1 of this year the Ministry of Labor at London announced that the unemployed register on that day in Britain, with its small population compared to United States. December 18. totaled 2,225,000? In this connection, might we not add the suggestion to this eminent British economist that he turn his attention to his own country and recall that the cry that went out during the World War from his native land was saying to all hesitant sons, '• 'Tis your mother that is calling you." Therefore, we invite his attention that at this date conditions in Brit- ain are such that his mother is compelled to advocate a new unemployment insurance system in a form of dole provision by which 12.000.000 are to be insured against unemployment and that 16.000.000 must be provided for, or one third of the population of Great Britain, with no system to suggest what may be done for their hapless future. At this point may we not call attention that we behold 6.150.000 men have been taken from the rolls of charity in America and, in the last 6 months of this administration, America placed upon a paying basis of employment? That we have taken the 6,000 banks which cracked like eggshells under the crushing power of their master manipulators and given assurance to their depositors and capital to their new existence — and from this NJI.A. gave new credit to a hun- dred thousand new undertakings. Is this the " failure of the N.RJi", as asserts the economist, for the return of de- posits?— as I must give credit, due to the labor of the emi- nent Senator from Michigan [Mr. VandenbergI and those of his colleagues in the Committee on Banking and Currency — this, in providing insurance to depositors. These depositors for the first time in their existence will have the assurance that their deposits are insured and that they will no longer be robbed by these master manipulators in America, as have been the late disclosures, sad to relate, in parts of the British Empire. Here is a new basis of a new confidence in America, and this connection with new emplosrment is a new revival of every form of commerce. The fanners are awakening in new hope; there is a new life among the bumble toilers: the young men now of a civil outdoor employment, no longer upon the streets helpless and facing the possibility of de« struction from the criminal and brigand bands that went up and down the land, availing themselves of those who. being hopeless, became then helpless against temptation. May we not invite this eminent English economist, and the splendid land which he represents, to realise the revival of all undertakings and the arising prosperity that has awakened and arisen in America under the policy of our President, all under the policy which the economist has heretofore characterized to the world as foolish and wherein he says the N.R.A. and its work have all been a fail- ure. We ask him, Will he not observe in another letter he writes the state of confidence of the American public, who, dispatching all differences of party politics, have in their splendid patriotism given their aid to their country, which, In the hour and day of Us desolation pending the demolition of lt» institutions, would have been left in the situation that England a short while ago found herself but for the element of union and patriotism which our country ever delighUi to point as its inheritance? And when this eminent gen- tleman, styled "economist", shall proceed again to write another letter, let him recall the comparison between this land within the little time which it has had to serve itself and that which unhappily afflicts his own, And may I suggest that, since he feels confidence in his own counselshlp and in his own guidance, he address himself to his own people and endeavor, perchance, to invest them with something of a new leadership imder the guidance which he assumes to offer America and the President of the United SUtes. Mr. President, I conclude with but one final observation. It is not done with any pleasure on my part but out of a sense of fitness and, I might say, propriety to the situation in behalf of this eminent economist. I would suggest that there be other letters written by this economist to his home people, and I would insist upon it but for the fact that I am not sure how it would be accepted and what weight would be given in England to the eminent gentle- man who has characterized our President as " foolish " and his advisers as crack-brained, for I cannot fail to bring to your attention, Mr. President, that but a short while ago I was visited with much doubt and much hesitancy as to the estimate of this gentleman, as we had before us the communication in print, in magazine form, of Hon. Lloyd George, late Premier and World War dictator for Britain- Mr. George, in addressing himself in the great problem haunting Great Britain as it touches the world, adverted to certain individuals who assumed in their imaginary wisdom to correct all errors, overcome all obstacles, and propound the solution for all difficulties, and in this connection Mr. George referred to one whom he described as John Maynard Keynes as a person of much insolence, great presumption, who assumes a remedy for all things, has never been right in ans^hing. bold to assume ansrwhere his superiority of thought and a privilege of condemnation, but by those who both know the writer and the conditions of England is con- stantly ignored, upon the theory that the prophet is without prophecy and his solutions of finance and economics without profit. It is at this point, that we pay our respects to the gentle- man, Mr. Keynes, and would invite him, before he writes another letter to the President and hurls his anathema, to come over and visit us and be received in our friendship. We trust, when he assumes to address another letter of similar assumption of authority and insolence of expression, he will recall that we beseech him to turn his attention home- ward and. within the sanctity of the scriptural injunction "Physician, heal thyself," we say to the eminent econo- mist in the language of our gentle admonition to our brethren around us at certain times justifying the obser- vation: "Now, nm along little boy; go home and play witix your marbles; we wish you well; and a Happy New Year." ue IS cui saviacr ui uvucb^a «-ju vu kuc awj «u >^v*. i- 192 congressiona:. record-senate lild Presidi jnt accona- Pore gn of of enjled ret re- (a) the SU tes the tes, re- Amer can Confilress co- re- noKh- Colun toi&, com- >een trrncKuaart Am wsabilitt twkd or rotnam srvxcx The PRESIDING OPPICER (Mr. King in the chair) before the Senate the foUowing message from the P- of the United States, which was read. and. with the panying report, referred to the Committee on Relations: To the Congress of the United States: I transmit herewith a report by the Acting Secretary SUte showing all receipts and disburtementa on accoiml refunds, allowances, and annuities for the fiscal year June 30, 1832, in connection with the Foreign Service ment and disability system as. required by section 26 of an act for the grading and classifJcatlon of clerks in Foreign Service of the United SUtes of America, and prodd- ing cimnpensation therefor, approved February 23, 193 FKAWKiaJI D. RooasvKL^ Thx Whzti House, January 8. 1934. (Enclosure; Report concerning retirement and disab|Uty fond. Foreign Service.) ntOPOSSD WOtTKWWTWlH IimKirATIOKAL HIOHWAT The PRESIDINO OFFICER laid before the Senate following message from the President of the United ~" which was read, and, with the accompanying report, f erred to the Committee on Foreign Relations: To the Congress of the United States: I transmit herewith the report made by the commissioners appointed according to an act of approved May 15. 1930. The act provided for their operation with Caiuuhan representatives in a study garding construction of a highway to connect the western part of the United States with British " the Yukon territory, and Alaska. The work of the mission having been completed, its existence has terminated. Fkamxlin D. Roosevki|t Tm Whtti Housk, January 8. 1934. [Enclosure: Report.] UCPORT OF perry's VICTORY MEMORIAL COMKZSSION The PRESIDINO OFFICER laid before the Senate the following message from the President of the United Stites which was read, and, with the accompanying reportj re- ferred to the Committee on the Library: To the Congress of the United States: I transmit herewith for the information of the Conixess the Fourteenth Annual Report of the Perry's Victory Me- morial Commission for the year ended December 1. 193 J Frakklin D. ROOSEVxiT Thk Whiti House, January 8. 1934. REPORT OF THE GOVERNOR OF THE PANAMA CANAL The PRESIDING OFFICER laid before the Senate th^ fol- lowing message from the President of the United States, which was read, and. with the accompanying report, ref^ed to the Committee on Interoceanic Canals: To the Congress of the United States: 1 transmit herewith, for the information of the Coniress the annual report of the Governor of the Panama Can^l for the fiscal year ended June 30, 1933. Franklin D. RoosEVEi.T. * ~^ T^E White House. January 8. 1934. SEPORT OF THE COUNCIL OF NATIONAL DEFENSE The PRESIDING OFFICER laid before the Senate th( fol- lowing message from the President of the United Slates, which was read, and. with the accompanying report, referred to the CoBunlttee on Military Affairs: To the Congress of the United States: In compliance with paragraph 5, section 2. of the Appropriation Act. approved August 29. 1916, I herewith the Seventeenth Annual Report of the Cox National Deffp^s^ for the fiscal year ended June 30. Franklin D. RoosEv^t-T- The White House. January 8. 1934. January 8 erection of memorials ANB entombment of bodies IK ARLINGTON MEMORIAL AMPHITHEATER The PRESIDING OFFICER laid before the Senate the fol- lowing message from the Piesident of the United Stat^. which was read. and. with the accompanying report, referred to the Committee on Military Affairs: To the Congress of the United States: In compliance with the requirements of the act of Con- gress of March 4, 1921, I transmit herewith the Annual Report of the Commission on the Erection of Memorials and Entombment of Bodies In the Arlington Memorial Amphi- theater for the fiscal year ended June 30. 1933. Franklin D, Roosevelt. The White House, January 8, 1934. report of UNITED STATES CIVIL SERVICE COMMISSION The'PRESIDING OFFICER laid before the Senate the fol- lowing message from the President of the United States, which was read and referred to the Committee on Civil Service: To the Congress of the United States: As required by the act of Congress to regulate and improve the civU service of the United States, approved January 16, 1883. I transmit herewith the Fiftieth Annual Report of the United States Civil Service Commission for the fiscal year ended June 30, 1933. Franklin D. Roosevelt. The White House, January 8, 1934. (Note. — Report accompanied similar message to the House of Representatives.) amendment of VETERANS' REGULATIONS The PRESIDING OFFICER laid before the Senate the fol- lowing message from the President of the United States, which was read and, with the accompanying six Executive orders, referred to the Committee on Finance: To the Congress of the United States: Pursuant to the provisions of section 20, title I, of the act entitled "An act to maintain the credit of the United States Government ", approved March 20, 1933. I am trans- mitting herewith certified copies of Executive Orders No. 6229 (Veterans' Regulation No. 1 (b)). No. 6230 (Veterans' Regulation No. 2 (a)). No. 6231 Veterans' Regulation No. 3 (b)). No. 6232 (Veterans' Regulation No. 6 (a>). No. 6233 (Veterans' Regulation No. 7 (a)), and No. 6234 (Veterans' Regulation No. 10 (b) ), approved by me on July 28, 1933. These veterans' regulations amended the regulations ap- proved by me on March 31. 1933, and June 6, 1933. and were issued in accordance with the terms of title I, Public, No. 2, Seventy-third Congress. "An act to maintain the credit of the United States Government ", and Public. No. 78, Seventy- third Congress. "An act making appropriations for the Ex- ecutive Office and sundry independent executive bureaus, boards, commissions, and ofiBces. for the fiscal year ending June 30, 1934, and for other purposes." Franklin D. Roosevelt. The White House, January 8. 1934. LAWS AND resolutions OF NINTH PHILIPPINE LEGISLATURE The PRESIDING OFFICER laid before the Senate the following message from the President of the United States, which was read and. with the accompanying copies of laws and resolutions, referred to the Committee on Territories and Insular Affairs: To the Congress of the United States: As required by section 19 of the act of Congress approved August 29. 1916, entitled "An act to declare the purpose of the people of the United States as to the future political status of the people of the Philippine Islands, and to provide a more autonomous government for those islands ", I trans- mit herewith a set of the laws and resolutions enacted by the Ninth Philippine Legislature during its second special session January 16-31, 1933. Franklin D. Roosevelt. The White House. January 8. 1934. ^^^T^-i-.f-^ririT/^-VT A T T>T7« r'/^'DTl CITXT A TTT. Janttary 8 1934 CONGRESSIONAL RECORD— SENATE 193 LAWS OF TRV TWKLrTH LKOISLATTTKE OT FUKKTO KICO The PliESIDINa OFFICER laid before the Senate the following message from the President of the United States, which was read and. with the accompanying copies of laws. referred to the Committee on Territories and Insular Affairs: To the Congress of the United States: As required by section 23 of the act of Congress approved ICarch 2. 1917, entitled "An act to provide a civil government for Puerto Rico, and for other purposes ", I transmit herewith certified copies of two volumes of laws enacted by the Twelfth Legislature of Puerto Rico during its fourth and fifth special sessions. October 18-21 and November 11-lf, 1932. respectively, and by the Thirteenth Legislature of Puerto Rico during Its first regular session. February 13 to AprU 15. 1933. and its first special session. August 1-14, 1933. Fkamkuh D. Roosbvslt. TU Wrxts Hoobb, January 8. 1934. AinruAt RxroiT or trx covniroR or rxmTO kzco The PRESIDINO OFFICER laid before the Senate the fol- lowing message from the President of the United States, which was read, and« with the accompanjring report, referred to the Committee on Territories and Insula^ Affairs: To the Congress of the United States: As required by section 12 of the act of Congress of March 2, 1917, entitled "An act to provide a civil government for Puerto Rico, and for other purposes ", I transmit herewith for the information of the Congress the Thirty-third Annual Report of the Governor of Puerto Rico for the fiscal year ended June 30. 1933. This report contains valuable information which it is believed should be available in permanent form. It has heretofore been customary for the President to recommend to the Congress the printing of the anniial report of the Governor of Puerto Rico, the cost of such printing being charged against War Department appropriations. In the present case, however, due to special conditions not ordi- narily obtaining, the Government of Puerto Rico has ar- ranged to make available to the War Department a number of printed copies of the enclosed report, suf&cient to meet the minimum needs of the Federal executive departments, and also to supply a limited number of copies for the re- quirements of the Congress. In view of these facts and of the urgent need of effecting exceptional economies at this time, the customary recommendation for the printing of the annual report of the Governor of Puerto Rico is omitted. Frakklin D. Roosevklt. The Whtte House, January 8, 1934. FRANCHISES GRANTED BY PTTBLIC SERVICE COMMISSZON OF PUERTO RICO The PRESIDING OFFICER laid before the Senate the following message from the President of the United States, which was read. and. with the accompanying papers, referred to the Committee on Territories and Insular Affairs: To the Congress of the United States: As required by section 38 of the act of Congress approved March 2, 1917. entitled "An act to provide a civil govern- ment for Puerto Rico, and for other purposes ". I transmit herewith certified copies of each of three franchises granted by the Public Service Commission of Puerto Rico. The franchises are described In the accompanying letter from the Secretary of War transmitting them to me. Franklin D. Roosevelt. The White House, January 8, 1934. PROPOSED PHILIPPINE INDEPENDENCE The PRESIDING OFFICER laid before the Senate the following message from the President of the United States, which was read. and. with the accompanying r^olutlon of the Philippine Legislature, referred to the Committee on Territories and Insular Aff^urs: Lxxvni- -13 To the Congress of the United States: I transmit herewith for your Information a copy of Con- current Resolution No. 46. adopted October 17. 1933. by the Ninth PhiUppine Legislature during Its thbrd session, en- titled "Concurrent resolution informing the Congress of the United States that the Philippine Leglriature. in iU Ofwn name and in that of the Filipino people, declines to accept the act of Congress, entitled 'An act to OMble tbe people of the Philippine Islands to adopt a constitution and form a government for the Philippine Islands, to provide for the Independence of the same, and for other purposes,' in its present form and appointing a committee to proceed to the United States at the earliest practicable time to leelc amendments to said act of Congress, or the enactment of such new legislation as will fully satisfy the aspirations of the Filipino people to become at the earliest praeticaMe date a free and independent nation, under conditions and circumstances that will not imperil the political, social, and economic stability of their country." Fkavklxh D. Boocevxlt. Ths WHira Houss, January t, t934. 8K88ZON LAWS Or ALASKA. ItSS The PRESIDING OFFICER laid before tbe Senate the following message from the President of the United States, which was read and referred to the Committee on Terri- tories and Insular Affairs: To the Congress of the United States: In conu)liance with the provisions of the act of Congress approved August 24. 1912. I transmit herewith a certified copy of the Session Laws of Alaska of the Alaska Terri- torial Legislature. 1933. Franklin D. Rooskvclt. The White Hoxtse. January 8, 1934. (Note. — ^A copy of the laws accompanied similar message to the House of Representatives.) call or THX ROLL Mr. McNARY. I suggest the absence of a quorum. The PRESIDING OFFICER. The clerk will call the roll. The legislative clerk called tbe roll, and the following Senators euiswered to their nxunes: Adams Ashuist Austin Bachman BaUey Bankhead Barbour Baricier Black Bone Brown BulkleF Bulow Byrd Byrnes Capper Caraway Carey Clark Connaily CooUdge Copeland Coetl8«n Mr. LEWIS. My colleague [Mr. Diktbrich] has bem and still is ill and is therefore necessarily absent. I ask that the announcement may stand for the day. Mr. AUSTIN. I wish to announce the necessary absence of my colleague [Mr. Gibson], and would like to have this announcement stand for the day. The PRESIDING OFFICER. Nlnety^-one Senators have answered to their names. A quonun is present. carter H. HARRISON '* As in executive session, Mr. LEWIS. Bfr. President, at the request of the chair- man of the Finance Committee [Mr. Harrison], I report favorably the nomination of Htm. Carter H. Harrison to be collector of internal revenue of the city of Chicago. The Cousens Keyes Robinson. Ark. Cutting King Robinson. Ind. Davis LaFollett* RusseU Dickinson Lewis Schall Dill fihcppard Duffy Lonergan Shlpetead Krlckaon Long Smith Fees McAdoo Btelwer Fletcher licCarTan Stephens Prazler McGlll Thomas. Okl*. George MeKellar Thomas. Utah Olass licNary Thompson Ooldst)orough Murphy Townsend Oors Neely TranuneU Hale Nonts Tydtngs Harrison Nye Vandcnberg Hastings OlSahoney VanNuys Hatch Orerton Wagner Hatfield Patterson Walcott Rayden Plttman Walsh Hebert Pope Wheeler Johnson Beed White Kean Reynolds Tbs Whitk Housk. Jantiary 8, 1934. THK WHITE HOUSE, January 8. 1934. CaNGRESSIONAL RECORD— SENATE In be to ;he in report Is approved by aU Interested, and I would like to sky that no more noUble. worthy nominaUon could be male than of this gentleman, five times mayor of Chicago. I ho|?e it will be accepted and by the Senate confirmed. The PRESIDING OFFICER (Mr. Thomas of Oklahoma the chair). Does the Senator ask unanimous consent lor the immediate consideration of the nomination? Mr HEBERT. Mr. President. I did not hear the reque st. May we have the request again stated for the information of the Senate? ^ _ Mr. LEWIS. I have presented from the Finance Coin- mittee a report of the nomination of Hon. Carter H. Har ri- sen and. at the request of the chairman of the Finance Co n- mittee. am asking confirmation at this time, because by so: ne accident it was omitted when other nominations from Ihe Finance Committee were reported. The PRESIDING OFFICER. Is there objection to ^e request of the Senator from Illinois? Mr. DILL. I think that policy ought not to be pursued at this time. Mr. ROBINSON of Arkansas. Mr. President, I may lay that I shall move an executive session after the leglslat ve business of the day has been concluded and the matter njay then be presented. Mr. LEWIS. Very well. The PRESIDING OFFICER. The nomination will placed on the Executive Calendar. POLICIES OF THE ADMINISTRATIOW Mr. ROBINSON of Indiana. Mr. President, I desire comment briefly on the two messages submitted by President of the United States to the Congress within iie last week. I have a notion in my own mind that one mi rht go through the history of the RepubUc and examine all of the state papers of the various administrations and fnd none more remarkable than those two. The message on the slate of the Union was, of couse. flUed only with glittering generalties. I defy any Member of this body, familiar as he may be with the Governmfent of his coimtry. to read that message on the state of the Union and gain any enlightment whatever from its cont^ts with reference to the state of the Union The fsecond message dealt with the Budget. It is ni|ore unusual than the first and certainly more amazing in contents. The President in that message very frarkly stated to the Congress and to the country that next Ju^ 1 we will face a deficit of more than $7,000,000,000 in Treasury of the United States, and this notwithstanding l^t that the President himself and his spokesmen tave been going about the country during the past 6 months c on- fidently assuring the American people that the Budget wai balanced, that we were out of the red and into the blick Now the truth is out. The Budget is not balanced. Not only is it not balanced but it is in worse condition tian perhaps It ever has been in the history of the Nation, not even excepting war-time conditions. Mr. HARRISON. Mr. President The PRESIDINO OFFICER. Does the Senator from dlana yield to the Senator from Mississippi? Mr. ROBINSON of Indiana. In Just a moment. How strange it seems to some of us that the Presider t of the United States, when he submitted his so-called " econ|)my bill" last March, should have criticized the deficit of day. left by the administration which preceded him which was not a drop in the bucket compared with enormous deficit which the coimtry faces at the momei^t I srield now to the Senator from Mississippi Mr. HARRISON. Does the Senator from Indiana fjivor the public -works program provided by the Congress? Mrr ROBINSON of Indiana. Mr. President. I do not tare to be diverted into a discussion of the public-works program at this time. Suffice It to say that before I conclude, il ^" January 8 Senator will give me an opportunity to proceed. I hope to make some suggestions which, if they be followed on other side. I beheve will result in genuine relief and simply a " shot in the arm. In- hat and this the the not Mr. HARRISON. May I ask the Senator if he criticizes the deficit which the President so frankly stated to the country exists, and whether he is in favor of the P.W.A.? Mr. ROBINSON of Indiana. I shall not be diverted in the slightest degree to a discussion in other channels than those I select for myself on this occasion. Mr HARRISON. May I ask if it is fair for us to mter- pret that the Senator's criticism of this deficit is because he was opposed to the public-works program and the C.W.A. program? Mr. ROBINSON of Indiana. As I said. I do not care to discuss that with the Senator at this moment. If he wUl do me the kindness to remain in his seat I think he will learn something in connection with my own views right along that line. Mr. HARRISON. It will be the first time I ever learned anything from the Senator. [Laughter.] Mr. ROBINSON of Indiana. I propose to proceed in my own way and not be diverted in the slightest by the Senator. Mr. LONG. Mr. President, will the Senator from Indiana yield to me? The PRESIDING OFFICER. Does the Senator from Indi- ana yield to the Senator from Louisiana? Mr. ROBINSON of Indiana. I yield. Mr. LONG. I would not interrupt the Senator if he had not already had a little disturbance in the continuity of his remarks. I think I showed the Congress that we did not have to have a deficit even to have the public-works pro- gram. That has never been disputed. Mr. ROBINSON of ^Indiana. Mr. President. I challenge the frankness on the part of the President himself. I con- tend that he has not been frank with the American people or else he was not familiar with conditions as they were. I desire to quote, for the benefit of the Senator from Missis- sippi [Mr. Harrison] and any others who may be interested in the subject, from a speech made by the President of the United States on Monday October 2 last, to the National Convention of the American Legion, in which he used this language: It was because of this that we undertook to take the National Treasury out of the red and put It Into the b!ick: and in the doing of it we laid down two principles which directly affected benefits to veterans — to you, and to veterans of other wars. " In the doing of it! " Now. Mr. President, it develops that it is not done. I wonder if the Senator from Missis- sippi would undertake to say that as recently as October 1 last. 3 months ago. the Chief Executive of the Nation was unaware of the fact that we were confronted with a deficit in the Treasury? At that time he said we were in the black. Mr. HARRISON. Mr. President, does the Senator want me to answer that question? Mr. ROBINSON of Indiana. No; the Senator will not need to answer it. It answers itself. Either the President of the United States knew at that time that the Budget would not be balanced, and therefore misrepresented the true facts to the American people and was not frank, or else the President of the United States was ignorant of the facts; and in either case it does not speak well for the administration. Mr. President, the Budget now appears to be in the red— not in the black— $7,309,068,211. Mr. ROBINSON of Arkansas. Mr. President, will the Senator rield for a question? The PRESIDING OFFICER. Does the Senator from In- diana yield to the Senator from Arkansas? Mr. ROBINSON of Indiana. In a moment. Interest charges on the borrowings in excess of Budget esti- mates will slightly Increase this figure. Mr. President, we know how much the interest charges will increase this figure. The figure is above 7 billion dol- lars as it is, and the President admits in his Budget message that " interest charges will slightly increase " the figure that has been given to the country. I yield to the Senator from Arkansas. 1934 CONGRESSIONAL RECORD— SENATE 195 Mr. ROBINSOK of Arkansas. Mr. Pre^dent, does the 1 Senator make no distinction between a balance of the Bud- get with respect to what are termed the ordinary expenses of the Government and extraordinary expenses incident to the recovery program? Mr. ROBINSON of Indiana. Mr. President, we never have made such distinctions until this administration. Why should any distiiictions be made? We have a certain amount of Income and a certain amount of outgo. The outgo until July 1 will show a deficit of more than $7,000,000,000. Mr. ROBINSON of Arkansas. The Senator, as I under- stand him, makes no distinction between the expenditures of the Government for ordinary governmental piu-poses and those expenditures which have been incident to an extraor- dinary and unusual program of legislation and administra- tion. Am I correct tn that? Mr. ROBINSON of Indiana. And no distinction ever has been made until this administration came in. No distinc- tion of that kind was made when the last administration went out, and the incoming President commented on the large deficit. Mr. ROBINSON of Arkansas. Will the Senator yield for another question? Mr. ROBINSON of Indiana. I yield. Mr. ROBINSON of Arkansas. Does the Senator feel that In the statements he has read from the President there was neither a distinction in the mind of the Executive himself nor .'i distinctibn in the minds of those who heard him between the ordinary expenses of the Government and those which are incident to a very unusual program of legisla- tion and administration? Does not the Senator know that that distinction was in the mind of the country, and is it not in the mind of the country now? Whether the distinc- tion should be carried or not is not comprehended by my question. Mr. ROBINSON of Indiana. There might have been some distinction in the mind of the country prior to the receipt of this Budget message by the Congress. I do not think there Is any question in the coimtry's mind today of Just what the country faces, and the fact that we are plunging headlong toward national disaster unless the brakes are applied somewhere along the line. Mr. ROBINSON of Arkansas. Just one more question. Is !t the Senator's contention that the exp«jditures should have been kept within the revenues during that part of this administration that has elapsed? Mr. ROBINSON of Indiana. It is my contention tiiat there never should have been but one set of Budget figures kept at any stage of the game — Just one, the expenses and the outgo. That has always been done. What was the necessity for any change? Mr. ROBINSON of Arkansas. Very well. That is not re- sponsive to the question that was asked the Senator, if I may express my opinion on that subject. Is it the Senator's contention now that the expenditures under the Budget and in the interest of the general welfare should have properly been kept within the revenues? Mr. ROBINSON of Indiana. There is no way to tell what are extraordinary expenditures and what are normal expenditures. As a matter of fact, Mr. President, the Presi- dent himself in his message almost states that fact. He states that there has been no coordinated audit at any time during the 9 m<,c. a/.t«T7i*-v rviu r*»siimf> and then we will n 196 CONGRESSIONAL ii that the t atn ^ ■j.e i 7(0 tlie farn Indiana who a Statbs Were recove ry Mr LONG. I am interested in knowing whether the Sen atJf voledTor the Long amendment to collect through ta^^ ?ioS inheritances above $5,000,000 and mcomes abov< *^iSS^T)SmlSN of Indiana. My recollection is that voted for that amendment. Mr. LONG. I thank the Senator. Mr ROBINSON of Indiana. I want to read somethini else from this message of last week, the Budget message is the President's own statement in this m^ge that himself has advertised to the country as being b^itall frank. Let us see how frank it is. I quote from t>^^ President: The reeulta of expenditures already made show themselves concrete form In better prices for farm commodities. " Better prices for farm conunodities." Just let me ref* to a letter I have just received from a farmer out in Indians . Prices! This farmer sent to Indianapolis an 810-po«ng cow 5 years old. and in fair condition. He received for cow $4.97. He received $4.97 for the whole cow! Yet President says here. The resulU of the expenditures already made show themselv(« In concrete form in betUr prices for farm commodities. A farmer friend of mine out in Indiana, just before I le to come here, sitting beside me at luncheon, told me of experience he had had the day before. Needing so money, he sought a market for a Jersey cow weighing pounds, and the .best market he could find was $3 for cow. Never in the history of this country were some i commodities so low in price, not even in Cleveland's day. Mr CAREY. Mr. President, the farmer in In(^'"' should be congratulated. I know a Wyoming farmer received 50 cents for a cow. Mr. ROBINSON of Indiana. Think of it, 50 cents for cow in Wyoming! Yet the President of the United "'^ says: The results of the expenditures already made show themselves In concrete form in better prices for farm commodities. How about the prices of dairy products of all kinds? they ever so low? Is that the way the whole program is working out? — In renewed business activity. In Increased employment. Mr. President, far be it from me to take from the Presi- dent or his administration any credit which they de but let me read, in reply to that part of his statement, frdm a prominent business publication. This is dated January 1, this year: Two independent estimates of rising unemployment, made pi^b He last week, cast something of a shadow over the optli repwts of reUil trade, rising steel production, and building tlvlty William Green. In commenting on the American F»^ turn of Labor's flgiires. which showed a rise In Industrial une ment to 10,703.000 in November from 10,122.000 In October. that unemployment had continued to rise in the first half Decembsr and is now Increasing faster than at any time -< "" January. The National Industrial Conference Board estimate firms the American Federation of Labor trend and shows a 5- cent decline In November employment, a 10.7-percent drop In ' hours worked, and a 9.8-percent shrinkage In pay rolls. Another bit of evidence as to business conditions is given the most recent figures of bank debits, which are accepted - reUable trade indicator. OrdinarUy debits rise sharply in I> ber reflecting the more active transfer of bank fimds, but in 4 weeks ended December 21 aggregate debits in 141 large " were roughly $1,500,000,000 below the 4 weeks ended No\ 23, whereas a year ago there was a rise of ♦3.600.000,000 in corresponding period. R is possible that the declines in employment and pay rolls the kind of business activity reflected by bank debits have had a more direct repercussion on ratail trade and on some — Industries becaviae they have been counterbalanced by relief expenditures. In the first 22 days of December ment emergency expenditures ( the " extraordinary " totaled $346,000,000. or $15,700,000 a day. In all October figure was only $104,000,000. C.W-A. payments alone from De ber 1 to 23 were $53.842.000— which would exceed by nearly half total wage payments at $20 weekly to the 580.000 who private employment in November, as shown by the American eration of Labor estimate. iptlmli tic ic- Pedera- mpl )y- B^id of sihce om- f er- t4tal by I a Dec^m- the cities Novenc ber the md not special Fedsral Gov( im- Budi et) the Decsm- one lost ]ed- In other words, according to the estimate of the Amerl can Federation of Labor, in November 580.000 additional wor^s los^t their Jobs. RECORD— SENATE January 8 1934 CONGRESSIONAL RECORD— SENATE 197 Mr President, I challenge the President's statement that— business activity. That condition does not exist. ,^„„o»,f •• t The statement continues: "In increased employment I have just read the figures, showing that there is not m- CTe^d employment, but increased unemployment Tlie oS^activUy where employment has been increased is that r^connSn with wmch the money of the Government has ^e^ sSnt-f or the CivU Works Administration and °'mZ^: says the President, "results show them^lves^^ the reopening of and restored confidence m banks^ ^e story of the banks is a long one. He speaks of the banks S restored when, as a matter of fact, there are today n^OO 000,000 of frozen deposits in banks of the country wmch are stm unopened or are operating on a restr cted ^S. The best way to bring back prosperity is to thaw out those deposits. They represent much more in potential purchasing power than the actual deposits Therefore, since purchasing power is the thing wh,ch makes the recovery machine go. the best plan m the world would be to thaw out these deposits. These deposits belong I not to the Government, net to the banks, but to the Ameri- can people; and if we put this purchasing power in their hands their own purchai^ing power, their own money, then we will find industrial activity on all sides resummg on a permanent basis. It will not be just temporary. Mr. LOGAN. Mr. President, will the Senator yield? Mr. ROBINSON of Indiana. I yield. v. ^x. v* Mr LOGAN. I will ask the Senator, then, whether he approves of the lending of something like a biUion dollars by the Reconstruction Finance Corporation to the banks lor exactly the purposes he has been discussing and, if he does whether he believes that the loans for that purpose should be continued. ^ v. v. ^ Mr ROBINSON of Indiana. I do not know how much has been loaned. I know it is a comparatively small amount, and I know that all of that money belongs to the people, not to the banks, or even to the Government, and it ought to be restored to the people. When we restore it to the people we wiU restore purchasing power, and when we restore purchas- ing power business activity wiU resume, and then we wtU commence absorbing this unemployment on the street. The ten to fifteen million men on the streets, looking for jobs, with none to be found. wUl then have work to do, and it will be permanent work, and the purchasing power will be permanent. We will restore the American market and, therefore, restore American prosperity. Mr. LOGAN. May I ask the Senator how he would pro- pose to release this vast amount of deposits which are fro- zen, unless the Government finds it possible in some way to advance the money to the banks, and if it does that, will it not still further increase the deficit? Mr. ROBINSON of Indiana. In lieu of some of the mad spending which has been going on I am suggesting a plan by which the Government would get permanent results for its money and restore this money to the people. As it stands at present, the Government is insisting that credit be ex- tended, it is insisting to the banks all over the country that they extend more liberal credit on a long-term basis when, at the same time, the Government is holding over the heads of these banks, even the small country banks, and the bigger banks elsewhere, the measuring rod of liquidity, rather than of solvency. Even though a bank may be perfectly solvent, if it is not yet completely liquid according to the Government standard, then liquidation is forced, and when liquidation is forced, who suffers? The depositor suffers. He is the injured party. He is also the innocent party. It is his money, not the bank's money, not the Government's money. As long as the Government insists on this tight-fisted policy of liquidity rather than solvency, just so long will the banks continue to hold 80 to 90 percent of their funds liquid, and just so long will they refuse to extend credit to starved and hungry and sick business, and as long as business can- not resume the ten to fifteen minion men vaUdng the streets must continue to walk the streets, for they caimot find jobs. In the long run the Government cannot afford to keep that situation in existence. Purthermore. some day we will have to pay back the $32,000,000,000 this Govern- ment is going to owe during the next year. Mr. LOGAN. Mr. President, will the Senator please ex- plain what he means by the *' mad spending " of money by the Government? What particular expenditure of money would the Senator call " mad spending "? Mr. ROBINSON of Indiana. Did the Senator ever hear of the tree setters, the tree planters, all over the United States, 1.450 camps, which I think they call the Civilian Conrerva- tion Corps camps? I think they are the civilian conserva- tion camps, reforestation camps. That just reminds me that the other day some friends in Indiana called upon me and said they had Just finished clearing 14 or 15 acres of forest land so as to make camps for the winter. In that instance it is deforestation and not reforestation. Tliey are cutting down trees, not planting them. Mr. LOGAN. Then the Senator holds that the " mad spending " is in the Civilian Conservation Corps camps? Mr. ROBINSON of Indiana. But the Senator asked me to mention one way in which there had been mad spending of which I did not approve, and I mentioned one way. Tliat has cost approximately a billion dollars. What good do we get out of it except to build up a military machine? Is it the Senator's idea ttAt the object is ultimately to build up a dictatorship in this country — that the Regular Army cannot be built up so large without suspicion? I wish the Senator would get the questionnaires which have been sent to these camps and examine the reports which go to headquarters. Tliat is one thing of which I do not approve. I will say to the Senator. I do not see any occasion for spending a billion dollars for the tree setters. They, 18 to 25 years of age, were in better shape to withstand this depression than anybody else. Certainly they were better able to withstand the depression than soldiers that were sick, old soldiers in the hospitals on beds of pain, who were ruthlessly kicked out to balance the Budget, which we find now is more than $7,000,000,000 in the red. Mr. BYRNES. Mr. President, will the Senator yield? The PRESIDING OFFICER. Does the Senator from Indi- ana yield to the Senator from South Carolina? Mr. ROBINSON of Indiana. I jrield. Mr. BYRNES. I should like to ask the Senator from Indiana, following the question of the Senator from Ken- tucky, whether the Senator from Indiana is opposed to the loans made to Indiana — State, counties, and municipalities — for construction purposes, to put men back in jobs? Mr. ROBINSON of Indiana. Mr. President, I do not care to go into that question. I wish to complete what I had undertaken to say. Mr. BYRNES. The Senator can say whether he is opposed to the allocation of the money that has been used for those loans, which money certainly goes into the deficit which he is discussing. Mr. ROBINSON of Indiana. The Senator from South Carolina picks out one Isolated situation. Lpt me give the Senator one. In the first place, it was proposed that we establisli these C.C.C. camps and pay the tree planters $1 a day for planting trees. The question was how to get the money immediately to start the project into motion. Do the Senators know how we got it? This is the way: Mr. President, we had a fund of $146,000,000 remaining over from the last administration. It was an emergency building fund. The Senators will remember that it was for the construction of public buildings, emergency build- ings, to relieve the depression. That fund of $148,000,000 had been allocated to the building trades — that is to say. to the bricklay«rs. to the carpenters, to the joiners, the stone- masons, the cem«it mixers, the house painters and deco- rators, and to those in aUied lines of Industry. The blue- prints had been drawn, and the sites had been selected- one out in Plymouth. Ind.. my ^wa State. Going to Ameri- can labor, that fund was calculated to uptrald the American wage scale, to uphold the American stsuidard of living, to uphold purchasing power, and therefle all over the land. Washingtuu has the money. He said: If any of you folks out there within sound of my voice nee< any money, wire me. How much money do you suppose he ever sent to th< untold thousands who wired him? My understanding ii that a printed or mimeographed sheet of paper was sen out to each one of those who wrote in. saying, "Apply t country what our txjrrowing problem Is for the next 6 months , permit me to remind you that w^e shall have to borrow approx' • mately »6.000.COO.OOO of new money, and. In addition. $4,000,000.00) to meet maturities of a like amount. That Is $10,000,000,000. Maybe we can borrow it. I do not know. We have not attempted it yet in this administra ■ tion. Let that be understood. Everything so far has been short-term borrowing. It is true that last month somethini ; more than $900,000,000 was raised from the sale of notes, but they were 1-year issues — 12 months. The test will com; when you undertake to do some of this refunding on a long ■ time basis — IS or 20 years or more. Then see what you dc , those who are so much interested in maintaining the credi: of the United States; so much interested, indeed, that it was necessary, it was said, to i>ass a bill here that would driv; the disabled veterans out of the hospitals of the country that had been erected for them. How is this money going to be raised. Mr. President? Surely the President has a way of raising it. How does h; propose to raise it? I will tell you, sir. how he proposes t) raise it, according to the Washington Star of yesterday . Let me read from the Washington Star of yesterday, ami this will give you some enlightenment on the method thi President has in mind — he and his Secretary of the Treas- ury—of raising this money: Becavise of Bailie's long experience in the Investment-bankln i field. Morgenthau's plan was for him to take active charge of tb i vast borrowing operations which the Government must undertak; In the next 6 months, and for which plans were said yesterday t> be advancing. That is an Associated Press story appearing yesterdaj. Who is Mr. Bailie, that he is to be given such vast power a ; this? Mr. President, since it has developed that the admin- istration was imposing such great confidence in Mr. Bailie , let us see who Mr. Bailie is. I shall now read from a publi - cation dated January 1 that has been placed in my hands within the last few hours: stunned by the appointment of Earle S. Bailie, central figure lit the unsavory Investment-trust promotions of J. and W. Seligman ft Co. during 1929, as the power behind the new Morgenthau throne. Senators are preparing to ask some pointed questions whei l his appointment as Assistant Secretary of the Treasury comet before tnem this January. The elevation to a dominating position in the Treasury of a man of the BaUie type by an admimstratloi l which has vaunted Its determination to drive the money changers out of the temple is regarded as little short of a travesty upon all administration professions. Thousands of unfortunate Investors throughout the United States remember Bailie as the man who, as chairman of the Trl- Continentai Investment Trust in 1929. unloaded $50,000,000 of stock up>on the public In a new organization known as " The Tri- Continental Allied Co." upon the claim, set forth in legally air- tight language in his official publicity releases, that the earnings on the first investment-trust common stock had been 42 percent during its first 6 months. Investors who believed Bailie's carefully worded estimates of earnings found themselves, after 4 years, hold- ing common stock which represented a lOO-percent loss of Its a-^-s^t value, or preferred stock which, so far from earning money, bad behind it only $38.31 asset value per share. The selection of the man who has been humorously referred to by some of his col- leagues in the Street as " 42 Percent Bailie " to administer the Treasury at a time when the new Securities Act is to be recast Into permanent foraa has sent the tremors up the spines of oCScial Washington. He is quite some man. Mr. President. I want to read a little more. I want to show the Senate how Mr. Bailie operated in South America. I still quote: It was Bailie's genius to t:\ke these third-rate crcdlt-rlsk for- eign borrowers and market fabulous amounts of their securities. On Peru. Bailie did his best piece of work. His plan there was to create for Sellgman's a stran'jle hold on Peru comparable to that which his firm had been niven on Nicaragua, thanks to the dollar diplomacy of the State Department in search of canal rights in Nicaragua. As Mr. Bailie did not have the State De- partment to assist him in Peru to the extent to which they had aided his firm in Nicaragua, Mr. Bailie worked through Juan Legula. the son of President Legula. a dictator who seized and held power In Peru from 1920 to 1930. when he was ousted by revolution. Mr. Bailie's associates, presumably und?r his direc- tion, fixed the son of the President of Peru by paying him about a half of 1 percent commission or over a half a million doUirs on a hundred million dollars of Peruvian bonds. 85 millions of which were sold to American investors in 1927-28 at upwards of 90 cents on the dollar. These bonds are now in default and are quoted at around 10 cents on the dollar. Bailie's firm made approximately a million dollars on this business. President Legula's son got his commission, and the American Investors were left holding the bag. Mr. President, there is the man whom our youthful Sec- retary of the Treasury had selected as his right-hand man to float the $10,000,000,000 that the President says will be necessary to be raised during the next year. We had a new face now in the oflBcial picture — Mr. Bailie. If I may read further: What was the outcome for the investors? After less than 4 years of administration by Chairman Bailie. Tri-Continental com- mon on December 31. 1932. had no asset value at all, while the preferred stock had an asset value of only $88.31 per share. In other words. In 4 years Mr. BalUe. by the use of good Judgment, turned $100,000,000 Intrusted to him In the 7 months between December 1928 and Jtily 1929 Into about $33,000,000. Instead of earning 42 percent a year, he has lost about two thirds of $100,- 000.000 of the investors' money intnisted to him for investment management. I quote further: The official Roosevelt organ said In defense of Mr. Bailie's appointment to the Trctisury that he had been chosen becatise he knew the trick of placing securities. Well, there Is no doubt that he is a master of security tricks. That is the man. Drive the money changers out of the temple! All of us were thrilled when we heard the Presi- dent's inaugural address last March 4 and listened to the words. " Drive the money changers out of the temple." What happened? They came rushing into the temple. There came the first Secretary of the Treasury, who, by uncontroverted evidence, was on five of the pet lists, called " preferred lists " of the House of Morgan, receiving, just because of his prominence, princely gratuities for which he rendered no services whatever; "he toiled not, neither did he spin." He is now out. Mr. Morgenthau comes in. Whom does Mr. Morgenthau immediately place in the Treasury as Assistant Secretary of the Treasury, as his right-hand man, to handle all the vast financial work tliat is now being undertaken by the administration, without any suggestion as to how they are going about it, for the President has not seen fit to tell us how he proposes to do it? He ju.st says we are going to do it; he does not explain how we are going to pay it back 1934 CONGRESSIONAL RECORD— SENATE 199 or anything of that sort; there is no question raised on that score. Mr. Bailie is selected for the job. Mr. President, here is the sequel. The headlines yesterday in the Washington Star read as follows: Ballle quits post as fiscal expert. Resignation removes final objection to Morgenthau's confirmation. But Morgenthau loved him just the same. I quote Mr. Morgenthau's letter accepting Mr. Bailie's resignation. This is what the youthful Secretary of the Treasury has to say to Mr. Bailie, quoting from the Washington Star of yes- terday: Jaktuakt 6, 1934. Dear Eable: In reply to your letter of January 5, I can only repeat what I have already told you. how much I regret that you find it necessary to return to New York. During your short stay •t the Treasury you have rendered real service to the President and to me. If he had stayed there another month, he would have had the whole Treasury [laughter], if one may judge by what he did in Peru, where, according to the evidence, he and those associated with him deliberately bribed the son of President Leguia and paid him hundreds of thousands of dollars in order to obtain certain concessions there. Diirlng your short stay at the Treasxur you have rendered real service to the President and to me. I appreciate greatly the personal sacrifice that Mrs. BaUie and you made In coming down here. My best wishes go with you. Very sincerely yours, ECnraT MoaocNTHA0. The point is. Mr. President, that the close friendship still exists. Of all the men available in the United States, Mr. Morgenthau selected Mr. Bailie — '* 42 Percent Bailie " — to become Assistant Secretary of the Treasury. What state of mind can one be in who will select such a man for this vast undertaking? How does he expect ever to hold the con- fidence of the people of the United States? And this sort of thing is done and men of this character are employed to take charge of the vast fiscal activities of the Government. Drive the money changers out of the temple! Mr. Presi- dent, apparently they are not only not driven out bi^t they are given front seats; they have the choice pews. What has got to be done. Mr. President, before there can be any real recovery in this country? Before there can be any real economic recovery there must be spiritual recovery, a return to common decency, the decency of the fathers, a return to the time when dishonesty at the top will not be permitted for a moment, because it finds its way down through all the strata of society, permeates the whole, per- verts it all. Honesty is still the best policy. Honesty at the top going down through all the strata of society leaves it clean and wholesome, and until we restore some sense of decency as the fathers knew it we shall have no economic recovery. The necessary thing is to take the Government out of Wall Street. This Bailie incident is tragic. Instead of restoring con- fidence in the Government of the United States it destroys confidence at a time when confidence is needed as never before in the history of this Republic. GOVERNOR OF HAWAII During the delivery of the speech of Mr. Robinson of Indiana, The PRESIDING OFFICER. The hour of 2 o'clock hav- ing arrived, the Chair lays before the Senate the unfinished business, the title of which will be stated. The Legislative Clerk. A bill (HJR. 5767) to authorize the appointment of the Governor of Hawaii without regard to his being a citizen or resident of Hawaii. Mr. ROBINSON of Arkansas. I make the motion now to recommit the bin, the title of which has just been stated, to the Committee on Territories and Insular Affairs. Mr. McNARY. I desire to inquire. Is tse bill the first one on the calendar? Mr. ROBINSON of Arkansas. No; it is the bill which is the unfinished business. It is a bill relating to the appoint- ment of a Governor of HawaiL Mr. McNARY. I am certain that the Senator from Cali- fornia [Mr. Johnson] wishes to discuss the first blU that is oti. the calendar. Mr. ROBINSON of Arkansas. This bill has no relation to that. The PRESIDING OFFICER. If there be no objection, the bill which is now the unfinished business will be recommitted to the Committee on Territories and Insular Affairs. POLICIES or THE AOMINISTKATIOlf After the conclusion of the speech of Mr. Robinsoh of Indiana, Mr. ROBINSON of Arkansas. Mr. President, no one who is familiar with the fiscal affairs of our Oovemment can contemplate them without a measure of concern and anx- iety. It is certainly true that since the new administration came into authority enormous and unusual amoiuts have been authorized to be expended. Looking into afCairs at present and anticipating the future, anyone who is con- cerned with the credit of our Oovemment realizes that it will be utterly impossible to carry forward a program of national recovery such as has been initiated without incur- ring a very large deficit unless heavy taxes in the form pt capital taxes be imposed. Tour present speaker has taken occasion in public ad- dresses to point out the consideration that always, when the Federal Oovemment enters a sphen of actl\ity. Its operations and workings tend to become exchisive. I have not the slightest doubt that when the cloads have been dis- pelled and the sim of prosperity again shines in splendor on this great land of ours we will have new problems that in part will have grown out of the course which it has been found necessary to pursue during the depression. The Senator from Indiana [Mr. Ronmoir] with his usual heat and impetuosity has in a forceful address bitterly con- demned the national recovery program. For the most part he has declined to segregate the features of that program and to express condemnation as to particular phases of it, with the single exception of the Civilian Conservation Corjjs. He began his address with a statement that I controvert with aU the emphasis at my command. That feature of his remarks was not related directly to the very profound issues involved in the fiscal policy now being carried on by the Treasury. It was a gratuitous and. to me, unjust and un- founded attack on the President, in the following language: I defy any Member of this body to read his annual message and to obtain any information on the state of the Union. It is said that comparisons are invidious. If I disregarded that axiom and made a comparison between the President's annual message and the speech just delivered by my friend from Indiana, I know what would be the vote of every Sen- ator in this Chamber, except the Senator from Indiana. If we take the standpoint of statesmanship and moderate expression founded on reason and sound judgment, and compare the President's annual message with the address just delivered by the Senator from Indiana, I have no doubt as to the results of the comparison. Almost every Member of this body was called on by the press, immediately following the delivery of the annual mes- sage, to express his opinion as to the importance and effect of the message. I am not going to put ihto the Recoss the opinions expressed from this side of the Chamber and those expressed from the other side of the Chamber; but the consensus is, and was, that it was an able document, one of the most forceful and appealing messages that has ever been delivered to the Congress of the United States. For my part. I must ask leave to accept the opinion of the Senator from Oregon [Mr. McNaxt] and other Senators on the other side of the Chamber as against that of the Senator from Indiana. The simple truth of the matter is that the message was received by the Nation with applause; and during 30 years in Congress I have never witnessed on a similar occasion such enthusiasm as was disi^yed in the Hall of the House of Representatives during the delivery of that address. The Senator from Indiana says the Pre&^ent admits a large deficit, but that he and those associated with him in ^ *■• ■ ^ i f » «! 200 CONGRESSIONAL RECORD— SENATE January 8 sit e politics ha7« been going about the country crying that t^e Budget is balanced. I want to ack Senators, not for an answer, because would embarrass them; but do they believe that is a fiir criticism of the course taken by the President? Eto they believe that the Chief Executive has been boasting that the Budget is balanced in the sense referred to by my friend the Senator from Indiana? Why. Mr. President, we all know that the President has repeatedly stated that the extraordinary expenditures in- cident to the national-recovery program have imavoidaMy kept the Budget out of balance. The statement has bem made that with respect to usual Government expenses trte Budget is in approximate t>alance, and I believe that to Ibe true. In the next breath the Senator from Indiana says t^at the President is not frank. I appeal to those men who in the press gallery, who have the duty of reporting to country the proceedings of the Executive and of the C gress. whether the Budget message was not the frankest Budget message that has come to the Congress during th^ir memory. I ask leave now, Mr. President, to compare it [in general terms with those Budget messages about which ttie Senator from Indiana remains silent — Budget messages which claimed that " just around the comer " the Budget would be balanced, that there was no substantial difference between expenditiires and outlay, when experience showed that deficits were growing all the time during the adm trations that Immediately preceded the administration I of President Roosevelt. Instead of giving you figures to ena )le you to mislead the country, if you desired to do so; instead of causing you to represent that no substantial deficit existed, the President of the United States rather exaggisr- aled the deficit. He stated the maximum of expendituj-es and the minimum of revenues; and if there is a man in Ihe press gallery who does not believe that to be true I shoiLld like to have him tell me so. either privately or publicly. The President, however, is not frank enough to please iny friend, the Senator from Indiana. The President has not used langiiage " unbecoming an officer and a gentleme; i." He has not gone out of the sphere of proper expression to attack anyone. He has told the truth, and the coun ry respects him for it. From limit to limit of this great con- tinent has sounded a round of applause that at last tl-Msre is in the White House a man who will not misrepresent or conceal facts pertaining to national expenditures. The Senator says these expenditures have not been m^de in the interest of the public; that they have been made lor the benefit of Wall Street. Do you. sirs, believe that to be true? Do you believe that President Roosevelt and his pdli- cies have lent themselves to the support of Wall Street? If you will analyze the national recovery program and j jst use a little common sense with respect to the purposes und sr- Ijring the expenditures, you will know that that statem !nt was conceived in an imagination which has little relat on to facts. What are some of the features of this national recovsry program? First, there is the effort to adjust farm commoc ity prices. We may differ; Senators differ on almast ev^ry Important question that arises. There rarely results nlmity of sentiment here on any dispute that comes before the Congress: but I think there is one thing that all concede is true, and that is that the eSart to raise the pi of farm products, the effort to finance farm mortgages home loans, the effort to promote national recovery through the National Recovery Act. have not been regarded by any serious-minded persons as in the interest of Wall Street! or great financial combinations. It is a peculiarity of tziis program that every featiire of it is intended to be appHed in the interest of the general public and for the purposqof promoting the recovery of the Nation as a whole. I have no quarrel with those who criticize features of the program. I have some little impatience with one who vo tes for a program and then refuses to accept his share of responsibility for it. But if you will consider the progrim as a whole, it has been carefully thought out for the lairp tee of bringing about a revival of confidence and a restoration of business activities to the normal. The Senator from Indiana talks about ignorance or mis- representation on the part of the President in connection with the Budget. I might, if I chose to retort in kind, make a similar characterization of the remarks of the Senator from Indiana when he said that the way to bring about na- tional recovery was to thaw out the frozen deposits in na- tional banks — just as if he did not know that a material part of the program that has already been carried out is the advancing of hundreds of millions of dollars through the Reconstruction Finance Corporation to unfreeze de- posits in closed national banks, to enable them to carry forward their normal activities and to give assurance to de- positors that they will be paid. I cannot account for such a statement in a speech in the Senate of the United States when I look at the figures that are available to every one. Up to January 1. 1934. there had been approved a total number of 3.391 loans to closed banks or banks in distress for the very purpose referred to by the Senator from Indiana, these loans carrying with them an aggregate amount of $248,373,350. But the Senator from Indiana says that a foolish thing was done; that a measuring rod was applied, having in mind liquidation rather than insolvency. There, again, he discloses such unfamiliar ity with the facts that I am imable to give my usual credence to the remarks of the Senator from Indiana, for the rule applied was that banks with 10-percent impairment of capital should be en- titled to assistance as well as those whose capital had not been impaired in the slightest degree. The result is that the closed banks applying for loans, with the exception of only about a hundred and fifty-four — the exact number I have not before me — have been sustained, their deposits are being thawed, and the very plan which the Senator from IndiMia insists is the sole plan properly to be approved for national recovery constitutes one feature of the plan or pro- gram that is already in operation. The President and those who are associated with him did not believe it wise to rely on any one measure as sufficient to britag about the desired results. After presenting the sub- ject to the Congress, there was authorized a very large public-works program. There is ground for objection to this policy, and I make no complaint as to those who in good faith believe that public works will not sufficiently aid imcmployment to justify the expenditures from the Treas- ury that are required. Nevertheless, in every part of this Union there are now at work, in the aggregate, millions who would still be without the opportunity to earn wages if it were not for the public -works program. TTie Senator from Indiana was vigorous in his attack on the C.C.C, the Civilian Conservation Corps, and he ridiculed the members of that corps as " tree setters." He wondered what was the purpose of the organization and condemned the President for not explaining to the Congress its purpose. Mr. President, if there is anyone here so lacking in intel- ligence as to require information on that subject, let me tell him that at the time the Civilian Conservation Corps was conceived and planned there were literally millions of boys and young men in this Nation out of employment, most of them red-blooded, vigorous, and anxious to obtain oppor- tunities to promote their own interests. MiUions of them were walking the highways. Millions of them were gather- ing about the dens in the great cities of the Nation, for there were no other places for them to go. The Senator from Indiana may tell the Senate but he will never convince the people of the United States that it was not a well-consid- ered action to gather together as many as possible of those young men and to give them places of assembly and train- ing and service, useful service to the people of the country. It is far better than to have them become tramps. It is far better than to have instilled in their hearts and minds a spirit of rebellion and resentment. It was a great work. Whatever one may think of the Civilian Conservation Corps program as a whole, it has per- formed the purpose for which it was planned. It has taken 1934 CONGRESSIONAL RECORD— SENATE 201 jouxig men from spheres of life in which they might have become not only useless to themselves and their families, but positive instruments for harm, and put them into or- ganizations where they will acquire a training which, in spite of the coixlemnation of the Senator from Indiana, will be useful to them in all the years of their lives. It is a great thing to redeem a young man from lost opportunities. It is a greater thing to bring to him opportunities in the hour of extremity and discouragement. This business of tr«e setting, which the Senator from Indiana ridicules so viciously, relates to a subject of very great importance to the people of this Nation. During the last century our forests have been almost destrojred. There have occurred great wastes, and those who look to the future with interest and anxiety realize that there is necessity for reforestation. Whatevo- hours may have been without immediate profit from the work by the members of the Civilian Conservation Corps, the purpose of the organization is an exalted and useful one, one of inestimable value not only to the present but to the future. The Senator from Indiana asked, as if he believed it to be true, whether the object of the Civilian Conservation Corps was to create military machinery, implying that there is some ulterior motive in the minds of the sponsors of the act in bringing it forward and in administering it. So far as the Army has had jurisdiction of the subject, no one need apologize for the ^auumer in which it has performed its duties in connection with the Civilian Conservation Corps. In every part of this country there are groups of these young men who are constantly becoming better and better citizens. They understand the traditions which underlie and support our flag and the institutions of this country. It is asked, " What benefit will it be to them when they go out of the camps? " Benefits which cannot be measured merely in dollars and cents will result. They will be better men, better fitted to perform the duties of life. They will be better citizens, better prepared to support the institutions which we all love. Mr. LOGAN. Mr. President, will the Senator yield? Mr. ROBINSON of Arkansas. I yield. Mr. LOGAN. I believe it is true that nearly all of the boys who Joined the civilian conservation camps made an allotment of $25 out of the $30 a month which they received, for the relief of dependents, fathers and mothers, and sisters and brothers, who actually were needing help. Mr. ROBINSON of Arkansas. I thank the Senator from Kentucky for that suggestion; it had escaped my memory. Yes: Mr. President, every boy who entered a conservation camp was given the opportunity; most of them were required to set aside a part of their earnings for the benefit of the members of their families; so that we were not only benefit- ing the lads themselves but we were benefiting those who were behind them in their homes, and thus in a practical sense supporting the general policy of national recovery. The sum and substance of the argument of the Senator from Indiana is to the effect that the national-recovery pro- gram has been a failure; that it has not accomplished any- thing worth while, but that on the contrary, it has imposed a debt on the country, and is imposing a debt on the country which will be difiScult to pay. In the beginning of my remarks I conceded the magnitude of the obligation and the diflaculties which will be encoim- tered in meeting that obligation, but I do not believe there is anyone who hears me who agrees with the assertion of the Senator from Indiana that there has not been material improvement in the affairs of the people of this Nation since the national recovery program was initiated. I am going to call as witnesses men who have not that bias and prejudice which the Senator from Indiana and the Senator from Arkansas may be held to possess. I am going to call, without regard to age, business, or politics, men who are known in this Nation and whose testimony will be accepted by all as worthy and credible. I find a statement attributed to B. C. Forbes, a renowned economist, published in the Washington Herald of Decem- ber 8, 1033. The headlines are: OpUmlsm now found predominant Hnong tndvHtry mnd buBlneos chiefs. Mr. Forbes reports nuxu«x)UB hopeful cigDs ot recovery. I desire to quote from the article, and I commend this to my friend the Senator from Indiana, who Is so dissatisfied with what we are going through now. and who apparently is so satisfied with what we went thnnigh before the 4th of March. The article states: After what we have been through during the last 4 yean it la good to feel that things tlnally are improving. Bufldlng eontracta reported for November are 64 percent ahead of last year. This la the best oompariaon. statistically, we have yet had. However, dollar volume Is etlU low, and percentage figurea look large be- cause they start from a smaU base. That, I find. Is quoted by Mr. Forbes from a large bosiiMSS man interested in building. I ask that the whole article be printed in the Record. The PRESIDING OFFICER. IS there objection? There being no objection, the article was ordered to be printed In the Rxcoro. as follows: (From the Washington Herald. Dec. 8. 198S] OPTTMISaC HOW rOTTND FBXDOMUfAlfT AMOirO XKOOanT AND ■UBIWiaB CHtzra — ^rosBis azpoBTs trauxMova hopeful sieMa or kbcovbt; rSDKKAL SXPKN8XB AIOSM Fllf AMCIAL WOSU> By B. C. Forbea Tou can open a converaation with many a traatneaa man taday without Immediately drawing on jowr head a deluge of peastmJsm. Were I to attempt to sum up the in^dominatlng attitude of busi- ness leaders today, I woxild expreas It thvis: The majority are more or leaa perturbed over some of the things being done at Washington, but. nevertheless, they are hopeful that nothing absolutely fatal to recovery will develop. Industrialists are somewhat less doubtful than bankers. Many Industrial com- panies have enjoyed quite substantial improvement In earnings. In certain industries ruinous price cutting has been stopped: In others, abated. The financial world Is fairly weU satisfied with the recent action of stocks and bonds. But it is alarmed over the magnitude of governmental expenditures, the ImpcMulblllty of foretelling what may happen to the Nation's currency, and the deadlock in capital- raising Interposed by the Securities Act. On balaxice, enooviragement has an edge over discouragement. Running across B. O. Dahlberg, the extremely indiistrlous maln- qiring of the Celotcx Co.. Z got from him yesterday these cbeer- txd facts and figures: " Our business this qxiarter is nmnlag fuUy SO perca&t ahead of last year. Our own surveys oonvlnoe us that we are going to have a good 1934. There Is to be extensive conafruetion of homes of the •3.0OO-$3,5OO class. We are busy perfecting a typo of smaU home which will cost leaa than anything norr available. We have shown an operating profit since May." The president of one of America's largest corporations Inter- ested In building told me yesterday: "After what we have been through during the last 4 yean, it la good to feel that things finally are improving. Building contracts reported for November are 54 peroeni ahead of last year. TfUM Is the best comparison, statistically, we have yet had. However, dollar volimie is still low and percentage figures look large beoaiwe they start from a small base." George I. Ck)chran. president of the Pacific Mutual Life Insxir- ance Co.. states that California Is participating In the gsDsral national Improvement. Although the oil Industry has succeeded In modifying some of its erlls, he feels that more should be done to conserve this Invaluable national resource. He cannot see the wisdom of spending many millions of public money on Irrigation projects at this time when other millions are being paid farmers to destroy crops and reduce production. Mr. Cochran believes that the time has come for Insiirance executives to arouse their 66,000.000 policyholders to the im- portance of having the Oovemment promptly stabilise currency on some feasible gold basis. Says Andrew W. Robertson, chairman of Westinghouse : " I would like to sound the warning that Oovemment should proceed with the greatest caxrtion along the road of assuming activities which have been heretofore handled by private institu- tions. All of our taxes, and they amount to approximately 9100 per capita, oome from private enterprise soiu-oes. Private enter- prise must thrive or there wlU be no taxes with which to pay the expenses of government." Mr. ROBINSON of Arkansas. Here is an authority who I know will make the Senator from Indiana ashamed of himself. It is the Governor of Pennsylvania. Mr. ChSord Pinchot. The headline is: Pennsylvania shows Improvement in paid employment, says Pinchot. Governor pleased at turn of economic affairs in S>ystone State since first of last year. I Will ask that tb&t article also be printed for the special benefit of my friend, Uie Senator from Indiana, who, I know, win hasten to read it. Ml f i 202 CONGRESSIONi^.L RECORD— SENATE U be BATS 1I» 8ho«n in iDdui tries Dls- last ol the more V orks wo: king January. be famines on were In lncre|uilng an the m conltlnu- year Laps, '.I has pel haps, :rkJ, and belp- There being no objection, the article was ordered printed in the Record, as follows: (From the Waahlngton Herald Jan. 1. 19341 ronrSTLVANU fHOWS IMPWOVIMENT IN PAID «MPLOTM«NT PINCHOT— COVlRNOa PLEASED AT TTEN OF ■COWOMIC AITAIK^ xrrsTONZ state since pibst op last teab By Gov. Glfford Plnchot. of Pennsylvania HAausBuxo Pa.. December 31.— Definite Improvement is employment and pay roU tor nearly all Pennsylvania since January 1, 1933. . « ^ , « «„ Industrial production for the Philadelphia Federal Reserve trlct has advanced nearly 28 percent since the low point of March. The department of labor and Industry estimates that approximately 1.310.000 persons unemployed last January, than 400.000 had returned to work In October. The Civil Administration wUl have many additional thousands before long. ,. . „ i_ , The dollar volume of the weekly Industrial pay roll in Pen^l- vanla has advanced approximately 40 percent since last The relief aituation in Pennsylvania as of October 1933 summarized by the statement that there were 323.601 fan relief and that the relief expenditures for that month • K 272 895.93 Every possible effort Is being made to improve conditio] ls Pennsylvania. The key to recovery, of course, lies in «"'•'•'>*'• the purchasing power of the masses. Mr. ROBINSON of Arkansas. I also hold in my hand article attributed to the Governor of Iowa, printed bj Universal News Service, as follows: [From the Washington Herald, Jan. 1. 19341 PEDEEAL WOKK HELP TO IOWA By Gov. Clyde L. Herring, of Iowa Drs MoiNTS, Iowa. December 31.— The economic condition Iowa has improved materially since January 1 last, and is Ing to Improve. The number of persons returned to work throughout the have not kept pace with those losing out until wlthm, the last 60 days, when corn husking and other seasonal wor taken up considerable of the slack. Civil works, public wo: " other governmental projects, Including the C.C.C. camps, are lnersoni i were added to pay roUs in Wisconsin between March 1$ and November 15. Kven buUding construction on private account has showd some Improvement since nxidsununer of this year, according to ) Lgures reported by tlie F. W. Dodge Corporation. Tlxls industif de- January 8 was this next tlons Sorts the cllned from contracts totaUng $163,000,000 in 1928 to $4,500,000 Much of Wisconsin suffered from a severe drought in 1933 M that crop and come types of livestock production are lower this year than in the past several years. I ask permission to Insert the entire article in the Record. The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: (Prom the Washington Herald of Jan. 1, 1934 J Majob Economic Changes Transpire in Wisconsin By Gov. A. G. Schmedeman. of Wisconsin Madison, Wis.. December 31— Since the beginning of 1933. and more especially during the past 7 months, we have witnessed economic and social changes of major importance , ., ^ , ^ At the beginning of 1933 Wisconsin factory employment totaled about 57 percent of normal and pay rolls averaged about 33 per- cent of normal. notable gains Factory employment in Wisconsin has shown month-to-month gains for 7 consecutive months past. Prom March 15 to Novem- ber 15 factory employment Increased 39 6 percent, while corre- sponding factory pay rolls have increased 70.2 percent. Exclusive of persons receiving jobs or jKisiilons under Civil Works Administration projects, approximately 55,000 persons were added to pay rolls in Wisconsin between March 15 and Novem- ber 15. Even building construction on private account has shown some improvement since midsummer of this year, according to figures reported by the F. W. Dodge Corporation. This industry declined from contracts totaling $163,000,000 in 1928 tCK$4.500,0O0 in 1932. Much of Wisconsin suffered from a severe drought in 1933. so that the crop and some types of livestock production are lower this year than in the past several years. GOOD CROP area A region In the eastern part of the State, from Georgia Bay south and across the southern part of Wisconsin, has had fairly good crops. Much of central, western, and northern Wisconsin has suffered so greatly from drought that agricultural production is materially reduced. Farm prices have shown some improvement. In January the average in Wisconsin was 63 percent of the pre-war average, and in October this index stood at 76 percent. Mr. ROBINSON of Arkansas. Then I have a message from New Jersey showing various substantial increases both in the matter of employment and in relation to general business conditions. I will also insert in the Rzcoro that article, which is by Governor Moore, of ew Jersey. The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: (Prom the Washington Herald of Jan. 1. 1934) New Jersey's Industries on Upward Swing — Governor Moore Cities Improvement in Conditions; Advocates Backing up the President By Gov. Harry A. Moore, of New Jerssy Trenton, N J , December 31. — Economic conditions in New Jer- sey have undoubtedly Improved greatly during the past year. Many of the indexes show a considerable Improvement. Employ- ment, pay rolls, department -store trade, electric power, and even building contracts show an Improvement during the year. The banking situation is improving. Many of the closed banks have reopened, and others are in process of reorganization. The latest figures of the Department of Labor, as of October 15, show that In 651 manufacturing establishments there was an in- crease of 34.000 persons employed since January 15 bf this year. Compared with October of 1032, the number of employees In 651 identical manufacturing establishments increased 32,700, or 21.6 percent: total weekly pay rolls increased $588,000, or 18 per- cent. The index of employment in October 1933 was 80, as com- pared with 638 in March 1933, and 70.2 in Octot>er 1932. Em- ployment in ofSces and in other industries has undoubtedly In- creased, probably more or less in the same proportion as tlie reporting manufacturing establishments. The peak of emergency relief was in March, when 513,000 per- sons were receiving relief from our State emergency relief ad- ministration. At the end of October this had fallen to 363,000. JOBS FOR 25,000 The clvil-works program has resulted In giving Jobs to 25,000 persons, and New Jersey expects to fill its quota of 120.000 before the end of the year. The public-works program should be In full swing within a reasonable time, and this should result in many jobs in our State, both directly and in connection with the fabrication of materials. The general improvement in business in the entire Nation should also be of great benefit to New Jersey, as our State is such an important manufacturing center in almost every line of activity. 1934 CONGRESSIONAL RECORD— SENATE 203 A* to suggestions m to how conditions may be improved. I think they would be Improved tnuncasurably if we would cooperate with the President and not try to Injure the cause by destructive or sneering criticism. Mr. ROBINSON of Arkansas. The Governor of Idaho says: The eeonomlc condition of Idaho has Improved very much since January 1 last. Approximately 200.000 unemployed have retvimed to work since the beginning of 1933. but there are still an equal number receiving relief. To furnLsh employment for all the Idle men and women in the United States It Is Imperative that the buying power of the people be Increased. With respect to the Civil Conservation Corps, let me invite the attention of the Senator from Indiana [Mr. Robinson! to an editorial published in the Washington Post on Decem- ber 2, 1933. I do not think anyone will assume that the Washington Post is politically biased in favor of national recovery measures. I quote: A JOB WOHTH OOIMQ Aside from whatever practical value the Civilian Conservation Corps might have — and the administration claim.? its fire-preven- tion work has diminished timber losses by 60 percent In compari- •on with last year — President Roosevelt made a wise decision to continue the camps another y?ar. The enterprise need not be justified at all upon a self-sustaining or partially self-stistaining basis. The idea behind it was to deal in some sane and practical way with the thovisands of young men who, fresh out of schools, or thrown out of work, could not b« absorbed into employment. They were roaming the country, thumbing rides and hopping freight trains — a restless, shifting mass of humanity chasing will-o'-the-wisp hopes of jobs. They were beginning to constitute social and police problems every- where. Their presence and their condition as larely victims of forces over which they had no control, constituted a challenge to alleviation that could not be ignored. Much of what they do may be wasted as far as conserving natu- ral resources is concerned. But the experiment Is creating national reserves of a better sort. The young men have come through with healthier bodies and happier outlooks. At least they have not been abandoned to their own devices, which in their despair might have bred lawlessness. Certainly, with all the money we are putting into buildings and roads, a minor Investment in human beings is worth while. "Riat is the opinion of the editor of the Washington Post, which I set over in comparison with the opinion expressed by the Senator from Indiana. I have here a statement about the great State of Cali- fornia. The Senator from California [Mr. Johnson], who is one of the most highly respected and honored Members of this body, who has served his State and his country long and well, gave out an interview expressing his opinion on the subject under consideration. The Senator from Cali- fornia said: I think we ought to go through with the public-works program. It Is serving a good purpose. We have not appropriated enough money to carry It out^ About the N.R.A. the Senator from California said: There is some kicking but a great deal of acclaim. The people have a determination to carry on and go through. As I see the situation now and as I regard the President, I will support him to the best of my ability. I ask that this article, which appeared In the Washington Herald on December 14, 1933, be printed in full in the Record. The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: (Prom the Washington Herald of Dec. 14. 1933) it's HOOBEVKLT 0« " HELL ", SATS HIRAM JOHNSON SENATOR PROM- ISES SUPPORT TO " THE BEST OF MT ABIUTT "; DEMTES AWT JtnKJE- Smp AIMS mther America is going through with President Roosevelt's pro- gram that " leveled human relationship on the basis of merit, or the country is going to hell economically ", Senator Hibam Johnson. Republican, of Calif omia, declared on his return here yesterday. The Nation Is passing through an economic revolution In which old methods no longer are countenanced, and the effect Is being seen In a new alinement of political parties — a loosening of party regularity, he sakL ••••••• JoHHsoH added: " I think we ought to go through with the public-works pro- gram. It la serving a good purpose. We have not appropriated enough money to carry It out." Asked about sentiment In hU State toward Um NJRJl.. Jom- BON replied: " There Is some kicking, but a great deal of acclaim. . The peopto have a determination to carry on and go through." Turning to the political slt\iatlon. the Senator aald: "The charming little coterie In New York that used to direct the political destinies of the country no longer has control. I don't think they will be able to dictate diiring the next 2 or S years or even in a decade. " The gentlemen in command prior to 1929 had no conception of the needs of the country. "As I see the situation now and as I regard the Prealdent. I will support him to the best of my ability." Senator Johnson remarked that " the gods of finance of 1929, whom we saw in disarray before the Senate Ranking Committee, have been stripped so bare that no longer need any of them be acclaimed." Mr. ROBINSON of Arkansas. Here is a statement from the Governor of California, who expresses the opinion that the national recovery program, particularly in relation to public works, is operating succeasfully and effectively. I have before me an article from the New York Times of December 3, 1933, written by Mr. Roland M. Jones, relating to the effect of loans on com In the West. I ask to have that printed in the Record. The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: (Prom the New York Times of Dec. 3. 1933) Millions in Loans Cheer Corn Bilt — ^lowa Expects f40.000.000 AND Nebraska $20,000,000 op Government Cash — Business Kx- PBCT3 Boom — MmoLE West Peels It Is No Lomoer Headed Down- hill, Birr Headed Onna Wat By Roland U. Jones Omaha, Nebb., November 29. — NotwlthaUndlng recent ertdenee of a contrary mood, the Com Belt generally is seiwlble of ample reason for thanksgiving. It is measurably better off than it was at this time a year ago, and it faces the future with a large degree of public confidence in the prospect for further material improve- ment. There is a definite feeling that it is facing the other way. that it Is no longer headed downhlU with the brakes out of com- mission, but that it is once again climbing, even if somewhat jerkUy and with the necessity of blocking the wheels and getting out to shove once In a while. Hence it brings a fairly txiU meas- ure of response In the traditional qplrlt to the aww^^^ proclama- tion for a Thanksgiving Day. In the expression of that spirit, thought turns naturally to the President and his leadership in the national movement for the promotion of recovery. A strmw indicative of the coupling of the administration with whatever cause there is tat gratitude la fur- nished in a newspaper symposium on the holiday and its meaning. Half the responses coupled Roosevelt by name wtth the subjects for thanksgiving. With some titers was a personal reason. A home or a farm had been saved frmn foreclosure and the deot upon it ref\inded on easier terms, or there was a job directly traceable to one of the administration recovery plans, and the prospect of a snug winter Instead of a place in the bread line. Mostly It was Just the expression of continued confldeaoe. Directly or Indirectly, the Com Belt has reason to be thankful to Washington for many ways In which It has been helped to bear its troubles. The agencies for relief and recovery have initialed their way into the consciousness of a good jnany petqde in a good many parts at the Middle West. But the greatest measure of relief, that which most nearly approaches universal api^catloo, came simultaneously with the Thanksgiving season in completion, of the set-up for the com loans and the Introduction of a new combination of iuitials, the C.CX3.. repreaentlng the Commodity Credit Corporation. Mnxioirs nr loans How mxich the com loans wiU bring Immediately into thim region is. of coune, a matter oi conjecture. It all depends on bow press- ing are the needs ot the farmer and bow much of his com he is willing to Impound to get cash at once. It has been estimated that the loans will run to HO.000,000 In Iowa and from ilSjOOCOOO to 120,000,000 In Nebraska. TlM release ot this cum. or such ot It as can be expected to be applied to current debts and new pur- chases. Is expected to have a quickly stlmxalatlng effect. The first loans have been made, the ma.in object being to deCer- mine how rapidly the routine could be disposed at and the cash become available to appliaants. The raaults were wbnHly sattaCac- tory. They demonstrated that a loan can be put through with a minlmiun of delay. With organlaatlon complete and the coopera- tion of the local banks In haodllnff the loans which maj be redls- counted with the C.C.C., the money should be going Into the hands of farmers in considerable volume before this time next week. It will depend largely on how rapU^ laspecton and jilt #1! I 204 CONGRESSIONAL RECORD— SENATE «LU haa case be price debt e. he of contract the cohtaln, l^por- svis- the t> aid cut lUus- put. of &hdlng vclume. 1 >ef ore c< insld- to certify that the requirements as to cribbing and sealing th« have been met. ^ ^. ^ _, . ». Prom the farmer's standpoint It Is the kind of loan h(i dreamed about, but never hoped to have offered him. It Is of heads he wtiis and tails the creditor, which In this case the Government, loses. If at the expiration of the loan the is above t^e loan figure, 45 cents a bushel, he may pay his and keep the difference. If the price is below the loan flgu turns over the corn and Is qiilt of his obligation. SIGHT UNSKKN To get the money only one principal condition Is required him. that he agree to sign a corn-hog production-control when the latter Is offered him. Farm-holiday leaders mak^ objection that he doesn t know what that contract will which la true so far as detail is concerned, but not as to Its ta::t general provisions. The loan applicant \» not inclined pect the Government of trying to sell him a pig in a poke objection is not taken seriously. What the farmer will do with his money when he gets it is trated by the use to which the wheat allotments have beer. There hare been considerable debt paying and tax paying the proceeds at the whefct checks, but merchants also are bualnens better where pav'ments have come in considerable The opinion has been expressed that it will be a long time any marked Improvemen: in farm income is reflected in a erable voiunie of improvement in business, because a large that Income will have to be applied to debt payment, measure there Is truth in this view. One of the first concerns of the farmer, after supplying IndKopensable items of his living as clothing and food to s ment the product of his garden, is to get his chattels out of It is not only the land mortgage and its Interest obligation have made the period of price deflation a hardship but therje large chattel-mortgage obligation to be liquidated as well local debt paying may be quite as important in revlvlfyr commercial life of agricultural communities as a sudden of buying. Mr. ROBINSON of Arkansas. There is now submit letter from a lady in South Orange. N.J.. dated 21. 1933. in which she expresses faith in what she is to term " the new deal ", and criticizes some of the Republican Party for their efforts to wreck this tional recovery program. I ask that the letter printed in the Recohd. The PRESIDING OFFICER. Without objection, it ordered. The letter is as follows: pirt such 4pple- hock. vhlch is a But ing the in ;rease ;ed a Nove mber pljased representatives na- be may raZTH IH NTW DEAL REPT7BIJCAN BLAMXS OTTK ILLS ON MANACEMKMT c -itlcal lired a and I ijreach is #cono- stem tell in ruin aid re- by struc- our To the New York Herald Tribune: Loud applause for your liberal spirit in publishing the letter of " Citizen " and those which followed. " Bom and Republican " gives one a right to flght in one's own camp resent the attitude of those dyed-in-the-wool G.OP.'s who as though all our Uls have come since March 4. The tr^th that we are atiffering now from the management of the mlata. politicians, and buslneas men who did nothing to the tide of disaster which has deluged us since the blows 1999. Not until the new deal started was the flood ol turned into channels which could take care of the reftise Why not put the blame In the past, where it belongs. member that our present condition has been bettered mo^th month as new ideals are at work to change the outrageous ture of the old conceptions of govemment in all phases df tatstory. Including biisiness, economics, banking, and the rariiflca- tlons of former finance, both at home and abroad? The nrw era may lead to reconstzvctlon in aU our relations with each other. What Lf there are faults in the Ideals of our present leaders? They confesi this themselves and hope to remedy errors in time The President has xned a delicate but mighty lever to dhange some condltlcwis which have been futllely attacked for decad^. It la an astounding piece of history. Again, who's afraid of the big. big dollar? When we tunate exK>ugh to get one. it buys more than it did yeaifa Cheap goods flood the stores, and we pay only a few cents for several articles of food. Our troubles came before deal, when our securities either cut dividends or dropped Our real estate went down in value long before, and we get half the rents we once received. Our taxes, then as nofr mainly on real estate and contribute to the waste and gance of State and municipal governments. Again I emphasize, put the blame where It belongs and ^bt on the superhuman efforts of those who are trying to lead tte way out. Kats XjOuiss Rob^btb. South Okangs. NJ.. ^orember 21, 1933. Mr. ROBINSON of Arkansas. I have here an 4rticle which appeared in the New York Times under date ol Jan- uary 7. 1934, urging Members of Congress to suppoit the President, and giving the reasons for urging that suppprt I ask that the article be inserted in the Rxcosi). ai» th! January 8 com of In a is so 1 AST for- ago. more new them, about are exitrava- The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: [From tile New York Times of Jan. 7. 1934] Flood or Letters Urge Congressmen to Back President — Mei^bxrs OF Both Parties Admit Opening Message Increased His Popu- , larity — Repttblicans Are Warned — Former Representative Says AN Attack on Roosevelt Now Would Be Disastrous Washington. January 6. — President Roosevelt's hold upon the American people is " amazing " to Republicans and " astonishing " to Democrats. That his popularity is Increasing and that his per- sonal address to Congress on Wednesday is bearing fruit was admitted on both sides In the House today. The flood of letters and telegrams to Congressmen In the wake of his Wednesday address, which politicians say was specifically addressed to the people of the country, is increasing daily. They all urge the individual Members to stand by the President In whatever he desires. One unusiial explanation of Mr. Roosevelt's popularity comes from a dyed-in-the-wool Republican, former Representative Mal- colm Baldrige. of Nebraska, and It cautioned Republicans that any broadside attack upon the President at this time would be " disastrous " MR. BALDRIGE'S letter The text of his letter, addressed to Representative Andrews, of Buffalo, an old friend of Mr. Baldrige, reads: (Law offices Dorsey & Baldrige. Omaha National Bank Bull ding J Omaha, Nebr., January 3, 1934. Hon. W. G. Andrews. M.C, Hotise Office Building, Washington, DC. Mt Dear Ham: I am constantly Inquiring from people in all walks of life in this part of the country concerning the present financial situation, and I thought you might be interested to Just get a slant on how I think the people feel out here. Everyone Is Impressed with the activity of ths Democratic regime and with the money pouring In on various projects and our streets filled with men working who have been out of Jobs for 2 years. th9 E>emo- cratlc control is still at its height and the almost warlike hysteria is still in full force In this part of the country. The question of where is all of the money coming from Is not yet pertinent, and is too far off and too Intangible to be seriously considered by the mas.5 of the people. This cannot keep up for- ever: and when there is a letting down, there will be a decided reaction; but at the present time any broadside attack on the President or his policies. I think, would be disastrous. The sur- prising thing to me is the universal resentment of anyone attack- ing the present relief programs. Even our most conservative and leading people who have been stanch Republicans feel this way, and the man on the street feels It much stronger. I certainly will be with you in heart and spirit at the open- ing of the session. You know I do not mean to presume by giv- ing you any advice, but I did feel that you might be interested In getting the real lowdown from someone who is in a position to know and who is vitally interested in your personal future and in the futxire of our party. I have sent this same letter to several of my good friends In Washington, and you may be sure that at the next congressional election, although I am not running myself. I will be in the thick of the flght to send as many Congressmen back from Nebraska to the Republican side as possible. With kindest personal regEirds and best wishes for a happy and prosperous New Year, I am, Very truly yours. Mac. STTPPOST amazes EAINET Mrs. Florence P. Kahn. of California, another stanch Repub- lican, said that she had not received " Instructions " to support the President's suggestions. " But it Is truly amazing the way the country Is for him ", she admitted. Belief in the President's hold upon the country was expressed today by Speaker Rainet after a visit to the White House. He was asked if he thought there woiild be silver legislation, and If it would pass. " If the President wants it; yes." he replied. " Will there be a sentiment against tariff legislation? " " Not if the President wants tariff authority." After other similar questions, Mr. Rainet exclaimed: " You might as well know it : nothing is going to pass here except what President Roosevelt wants." Humor and pathos are included in the messages that come to Congressmen from their constituents. One of the most loyal came to Mrs. Ralney. wife of the Speaker, who has received 118 letters herself since President Roosevelt addressed Congress. " I am sending you the deed to my farm ", the writer told Mrs. Ralney. • • • Mr. ROBINSON of Arkansas. Prom the New York Herald Tribune there has been clipped an article by John W. Remer, imder date of January 30, 1933, stating that a life- long Republican trusts Mr. Roosevelt and does not see that the Constitution is in danger. I ask that the article be inserted in the Rscoao. tr- ie i ^i^xTy-iT^mnoT/^XT / T Tyt?nr\T>n CTTXTATT? Javttapy 8 1934 The PRESIDINO OFFICER. Without objection, it is so ordered. The article is as Tollows: (Prom the New York Herald Tribune. Jan. 7, 1934] MO FKAS OF TTBANNT ^LJFKLONC EEPUBUCAN TRUSTS UK. KOOSE\'ELT; DOES KOT SEX CONSTITimON IN DAMCES To the Neto York Herald Tribune: Is our Federal Constitution In danger? The Honorable James M. Beck, one of our most distinguished lawyers In public life, seems to think It Is. His fears are aroused by the unusual grants of almost unlimited power given to President Roosevelt by Congress. But this grant of power Is by the freely chosen representatives of the people and for a limited period. The President did not demand the ptower. He showed his wllllugness to use power 11 given to him by the people, and we rejoiced in his courage, and that Is what he was elected for. Should his Judgment err In the use of that power, or should he misconceive its purpose and seek personal advantage from it, the power can be taken away as easily as it was given, and most surely it will be taken from him. No President has heretofore dared to Infringe on the basic element of our form of govern- ment, the Individual and equal sovereignty of each citizen to think freely, vote freely, and have his vote counted fairly and openly. The slightest indication of such a thing in a President la all the people need to put a stop to it. Witness President Wilson's mistaken demand that none but Democrats be elected to Congress. His power waned from that moment, in spite of everything. Witness also the resxilt of Presi- dent Theodore Roosevelt's mistaken idea that he was the one and only man for the time. He. too, failed, in spite of his personal popularity and past accomplishments. It seems to me that no one familiar with American history, familiar with the Federalist or Madison's Journal, or, last but not least, Mr. Beck's own splendid work on the Constitution, need have the least fear that Americans will submit to even the appearance of tyranny in a President. Power the President must have, and the greater the stress the greater the power to meet that stress he must have, in the very natixre of things. And also, in the very nature of things, the necessary power will flow to the executive head of a government, whether he wants it or not, or whether it is voluntarily given to him or not. The one thing Americans want is that the President use his power unselfishly, and the eyes of every citizen are upon him and he knows It. Courage we know he has. Wisdom we hope he has. Right purpose we believe he has. Hatred of tyranny is as strong today as in the days of Tacitus. It is as strong here as in England, and It is no more possible here than in England. When Americans cease to take an Interest In politics — local, State, and National — then, as always in the past, tyranny or dictatorship will, must, and ought to come; for above all things we must have order. In my humble opinion Americans are less subject to tyranny today than ever before in our history. On the other hand there is a deeper and more flexible and more rational understanding among all of us of the nature of the stress under which our coun- try is now existing and a broader understanding among us of the necessity of economic cooperation. If our country and our liberties have survived the " tyranny " shouted aloud against Washington, Jefferson, Jackson, Lincoln, Theodore Roosevelt, and Wilson, it seems reasonable to hope that the country and our liberty will survive Franklin D. Roosevelt, whose sincerity and high-mindedness no one can doubt, regrettable as it is, of course, that he happens to be a Democrat. As a lifelong Republican, you will, I trust, believe me sincere. John W. Remer. New York, December 30, 1933. Mr. ROBINSON of Arkansas. An article from the Wash- ington Times under date of January 1, 1934, is headlined "Dividend uocreases held amazing NJl-A. development." I ask to have that article printed in the Record. The PRESIDING OFFICER. Without objection, it is so ordered. The article is as follows: [From the Washington Times of Jan. 1, 1934] DtviDEMD Imcrxasbs Held Amaztnq N.R.A. Development — Evibt Unit in Severai. Lines Reports Gain in Earnings By Jonathan Wlckwlre This observer finds the most amazing development of the Roose- velt recovery program not in reemployment flgtires, agricultural, and industrial commodity price advances, widely exploited In the public prints, but in the notable Increases in earnings and dividend payments reported by corporations in the third and final quarters of the past year. BURIED IN OaSCURZ REPORTS Probably this recovery phase has impressed itself the more upon this writer because of Its very obscurity, the facts relating to it being obtainable only by digging through dry-as-dust reports and compilations generally inaccessible to the hurried lay reader, even If be were disposed to conduct the necessary research. CONGRESSIONAL RECORD— SENATE 205 The fact that mtire industries, each comprising scores of Indi- vidual units, have reported, without exception, earnings increases running into uncounted millions, while In otber Industries the I}ercentage of companies reporting improvement has faiJen only a little under 100 percent. This fact has not escaped the observa- tion of other discerning writers nor entirely failed of popular presentation. REVELATION BT GOUU> Thtis, Leslie Gould, financial edltw of the New York Evening Journal, In a recent lUuminatlng and detailed article, summariaes his findings as foUows: *' WhUe the ratio of corporations to show Improved earnings In the third quarter of this year, as compared with the corresponding period in 1932, Is better than 3Vi to 1, six major lines of industry have so far txirned in a perfect score. AU of the companies so far to report had greater profits than a year ago. " These industries are : Automobiles, motor-car accessories, chemicals, electric equipment, leather, and food. They are the banner lines, but running th^m a close second are buUding ma- terials and supplies, metals, including mining, motion pictxires, oils, railroad equipment, coal, and steel." But earnings Increases are not enough. These must be trans- lated into net income before they satisfy the management and, even more Important, the bankers. CONVERTED INTO OTVXDBirDS More, they must be transmuted into dividends before the real owners, the vast inultltude of stockholders, reap any readily ap- preciable benefit — any money income that they can spend for needs or luxuries — money which, so spent, wlU help fvirthsr to speed the whirling wheels of commerce, make more Jobs, and. by increasing demand, help raise prices for farm and other products. Increased earnings may simply mean that a company has cut down a deficit; that Income has Improved sxifOciently to cover bond interest, or a part of it, or, maybe, that earnings have risen enough so that a small balance is left, after charges, to carry the surplus account. All very excellent, no doubt, and of exceeding great Interest to the management and to bondholders, principally Insurance companies and banks. Highly Important to everybody, of course. Indirectly, for every- body Is Interested, vaguely, perhaps, but none the less surely, in the solidity and strength of these institutions: and the welfare of millions is closely dependent on their profitable maintenance. CASH MONET WHAT COUNTS But cash-money dividends, convertible at will Into any of their innumerable requirements, are what the stockholders want. And they are getting them — regular, special, extra. Increased, accumu- lated— in floods. A fair cross section of what is happening was presented In an International News Service dispatch printed In these columns on December 9, the gist of which Is contained In tiie following excerpt : " Stockholders in 69 American corporations will receive an In- crease of $65,691,540 In the Income from their investments througli larger dividend declarations by these concerns since November 1, a survey revealed today. " Forty-two companies have resumed or Initiated dividends rep- resenting disbursements of $28,040,498 to stockholders. "A group of 20 companies has declared extra dividends totaling $24,183,639. " In addition, nine other companies have Increased regular rates net by $3,467,403 for the current payment." This pertains only to actual Increased dividend declarations during a period of 30 business days among corporations listed on the stock exchanges. It takes no account of hundreds of regular dividend payments made during this period by listed companies, nor of thousands of unlisted firms and partnerships that divided normal or Increased profits during that time. riRMS USTEO BT HXTKDRSDe The current Dow-Jones dividend record occupied nearly four columns of agate type in the Wall Street Journal of December 18 and contains the names of 586 firms listed on the New York Stock and Curb Sxchanges. Of thess. 06 reported Increases over the last previous announcements. Before the period covered by the above International News Service article, back In September, and stiU more In October, the resumption and increase of dividends was beoomlng noteworthy. Since It was printed. 43 firms coming to the notice of this writer alone have announced dividend improvements, putting t^ total net gains to stockholders In the past 6 months tar above the $100,000,000 mark. raOTTTS 8PBSAD WZDBLT That Improved profits are not confined to listed corporations, to materialize In dividends, but are shared and being distributed by partnerships and companies In merchandising and other lines whiclr never have attained, or aq>lred, to a stock -exchange listing, is shown by the Federal Reserve Board report on retail-shop gains in November, on which a Wall Street Journal writer comments as follows: " From the retailers' viewpoint the Important factor Is that good profits are being earned even at the current level of dollar side%" Another evidence of the general permeation of Increased profits throtighout business Is contained In the banking reports, usually a fair barometer of rising or falling trade conditions. Up to Decem- ber ao qoaiterly dividends amounting to $l»JU2J>Sl bad been i n 206 CONGRESSION^ .L RECORD— SENATE January 8 CHRISTMAS CST7ISK a 12- cru se if on- to The French Line ship Lafayette, for Instance, left port for day cru:se through the East Indies with more than 400 flrstjclaas passengers aboard, who will spend both Christmas Day and New Year eve at sea. The Purness-Bermuda Line also reports that ■'winter tourist travel has definitely turned the corner and ia very ! much on the upswing." Officials of that line today are seeding out their two sister ships, the Queen of Bermuda and the arch of Bermuda loaded to capacity, headed for a 9-day Bermuda and Nassau, carrying 1.500 first-cabin passengers On the same day the Holland-American Line ships Statehdam inA Rotterdam will also steam out to sea with capacity loads, rylng 1,200 paaaengers on a 15-day cruise to South America West Indies. On these four ships alone, according to ahlh offlrials, there was a waiting list of almost 1.000 persons — ^ lome- thlng unheard of in ocean travel during the last 4 years Other trans-Atlantic lines — the Cunard, Italian. United itates Lines, Swedish -American, the North German-Lloyd, and 9am- burg-Amerlcan among others — with loiig- and short-time c-ulses to offer, report exceptionally heavy bookings, far In excess cir last year. Mr. ROBINSON of Arkansas. An article by Jam^ T. Williazns. Jr.. Is entitled " Civilian Conservationists Brig hten 300.000 Homes." I read from this article a statemeni at- tributed to a member of one of the organizations To five an adequate conception of what the C.C.C. has for me, I am impelled to deeerlbe the background leading my connection with it. riret. Imagine yourself ae a joung nun of good family, educated. IwppT. proaperoua. and ctirrounded by everything makee life worth while. Then Imeglne youreeU torn from this environment and like a, hunted dog through 4 yeara of unempiojrment. hungei, famine, ending In the complete and utter degradation of a leae bum. I waa loalng faith In everything that goes to make life while. The day a social worker met me in a Springfield " flop " houae and persuaded me to join the C.C.C. was a Ing point In my life. I was almost a physical wreck, days I gained 30 pounds In weight. As a citizen I am formed. Government Is a hateful thing to a bum. It moved from my door the specter of want. What more natural than that my old radical tendencl^ are being replaced by the stirrings of some of the finer attribute of good cltlsenshlp? In forestry I have for the first Ume found work that appeals to me. Life In the C.C.C. has restored my ralth. Spiritual life cannot exist for a man forced to live like a fayilne- drlven wolf. his With the permission of the Senate. I will print the article in the RBCoas as part of my remarks. declared by 18 of the 25 dividend-paying New YOTk banks, b -Ing- tag the total for the year, up to that time, to »82.457.937. Oihers toslght were expected to bring the final total to »85 000 000. only 20 percput below the 1932 figure, in spite of the bank ho.iday which eliminated some big payers of last year and made the ^olng more or less difficult for the survivors. Mr. ROBINSON of Arkansas. Mr. William H. Port bub lished a statement under date of December 23. 1933. in w aich he aiiserts that the gain in prosperity is reflected by inci ease in travel, and sets forth facts which he deems pertinex it to that contention. I ask to have the article printed in Record. The PRESIDING OPFICER. Without objection, it \s so ordered. The article is as follows: Tkavki. Gain Seen PaosprRrrr Sign — Ocean Lines Add Ship^ to* WiNTEE CEinSES TO MEET DEMAND By William H. Port New Yoax. December 23.— Besides the Increased sales of dA)art meui stores for the holiday trade, the "booster" reports of tales- men returning from their final trips of the year on the road, re- ports of Increased employment in the greater metropolitan dlJtrict and the proailse of many thousands more Jobs to be allottsd in the near future by the Civil Works Administration, other irdlca- tioas continue to crop up here to bolster the opinion tha; the depth.s of the depression have been passed, and bufciness ags in Is on the upswing. One deamte Indicct'.on pointed to as an accurate barometer of returning prosperity Is the Increase In ocenn travel. Then been some fears expressed by officials of steamship lines thai of money would keep the public at home during the v Inter months and force the lines to curtail their winter cruise jlans. There were also predictions that the coming of repeal, removing the necessity of leaving the United States to get a real c rink, would cause a further falling off of tourist travel. However, the fears of the ship line officials and the repeal dictions have proved to be ghosts, and a survey of 22 of the arger trBn=-At!ant*c and coastal shipping lines shows that the put lie Is digging money out of the old sock and is spending it freely, stead of cutting down their winter-cruise schedules the lines had to add to them In many cases. In- have car- the ■line done ip to weU that driven and Aomo- rorth (111.) tum- Wittln 30 Irans- re- (ntire There being no objection, the article was ordered to be printed In the Record, as follows: Civilian Conservationists Brighten 300,000 Homes By James T. Williams. Jr. Cljristmas Day was the brighter In 300.000 American homes becaxise, by prevailing upon Congress to provide for the establish- ment of the Civilian Conservation Corps. President Roosevelt was able to give 300,000 Americans a new start In life. The high expectations of the President in proposing this new national enterprise to Congress have been more than realized In all the 1.300 conservation camps that have been established all over the United States. The President predicted that the type of work that the Civilian Conservation Corps would do would prove of " definite practical value, not only through the prevention of great financial loss, but also as a means of creating future national wealth." SPIRITUAL VALUE " The Civilian Conservation Corps ". he said, " will conserve our precious natural resources. It will pay dividends to the present and future generations. It will make improvements in the na- tional and State domains which have been largely forgotten in the past few years of industrial dcvclopmsnt." But the Civilian Conservation Corps is doing more than this, as President Roosevelt said it would. " More important ". he said. " than material gains will be the moral and spiritual value of such work. The overwhelming majority of unemployed Americans who are now walking the streets and receiving private or public relief, would infinitely prefer to work." The President's faith In the rank and file of his fellow citizens Is fvilly shared by the Army officers who command the conservation camps throughout the country; The applications for membership in the corps far exceed the quota of the several States. Thousands of letters received by the Government from the young men attend- ing these camps afford convincing evidence that " the moral and spiritual value " of their work are even exceeding the material gains to the Nation. All of these letters are intensely human documents. Several of the best of them appear in the current issue of " American Forests ". which is published by the American Forestry Associa- tion. This association oCfered prizes for the best letters written by enrolled members of the Conservation Corps on the subject, '• What the Civilian Conservation Corps Has Done for Me." These letters form a remarkable narrative of human experiences. They are the best spoken evidence thus far available of the real value of the Civilian Conservation Corps to the youth of America and to the thoxisands of homes which they left for the road. In search of work to help relieve distressed parents. Prom a conservation camp in Illinois, a member of the corps writes: " To give an adequate conception of what the C.C.C. has done for me, I am Impelled to describe the background leading up to my connection with It. " First, Imagine yourself as a young man of good family, well educated, happy, prosperoxis, and surrounded by everything that makes life worth while. " Then Imagine yourself torn from this environment and driven like a hunted dog through 4 years of unemployment, hunger, and famine, ending in the complete and utter degradation of a home- less bum. " TURNING POINT " I was losing faith In everything that goes to make life worth while. The day a social worker met me In a Springfield (HI.) ' fiop ' house and persuaded me to join the C.C.C. was a turning point In my life. I was almost a physical wreck. Within 30 days I gained 30 poiuids In weight. As a citizen I am transformed. Government Is a hateful thing to a bvun. It has removed from my door the specter of want. " What more natural than that my old radical tendencies are being replaced by the stirrings of some of the finer attributes of good citizenship? In forestry I have for the first time found work that appeals to me. Life in the C.C.C. has restored my faith. Spiritual life cannot exist for a man forced to live like a famine- driven wolf." Prom a camp in New Mexico comes the record of " a home and harvest saved " by the money sent back by one of the younger members of the family from his earnings as a member of the Civilian Conservation Corps, " I feel we are doing a great work ", he writes. " I know we are helping thousands of worthy but poor parents and paving the way for the generations to come." During his campaign his proposal to set up the Civilian Con- servation Corps brought Mr. Roosevelt the criticism and ridicule of his political opponents. In 300.000 homes this Christmas season the President Is recelv< Ing the gratitude of the family for the national benefaction which the Civilian Conservation Corps has proved to be. Mr. ROBINSON of Arkansas. With the permission of the Senate, I will print an article from the New York Times under date of December 25, 1933. entitled " Climbing Out of the Depression ". by Ernest Poole. There being no objection, the article was ordered to be printed in the Rdcoro, as follows: 1934 CONGRESSIONAL RECORD— SENATE 207 (Prom the Wew York Times. Dec. 25. 19331 CUMBXHO OUT OT OCPKEBSION HENST STKXET TTSTTIKG NX7SSXS KEZD AID TO HIXP OniXRS To the EtoiTOH or thi Niw York Times: In these swift days of crisis I often wish that more of us could rouse to life that inner force of which I heard long ago in the Alp* at the top of the great St. Bernard — from a gigantic old monk who through nearly 40 winters had gone out into storms with the huge dogs to rescue travelers lost in the snow. No icy wind could turn him back. When a young man, he told me, he had been an Alpine guide. One day in a j>arty of six men with pope and pickax he had climbed some 5.000 feet down a granite cliff, and on a narrow ledge near the foot they found that an avalanche had made it quite impossible to descend to the bottom that way. and so they must climb back up to the top. Tired and hungry they clung to that ledge, and he said that fear took hold of him. a cold sweat came and he shut his eyes. But then he sent a call for help straight out into the universe, and very soon from deep inside, as thovigh In answer to his call. be felt such a wUl for living that he rose to his feet like a man and led his five companions through weary hours foot by foot up that mighty cliff of rock to life and safety at the top. And he believed that force had come from the God asleep In every num. which needed only calling on to stir a man to miracles. Here In America, if we mean to climb the great cliff of this depression up to a safe national life, each one of us will have to call upon that force within ourselves. For no man can climb this cliff alone. It needs a whc^e nation climbing together, with every- one of us doing his part. This is a time for mutual aid — and every victim of these hard years whom we lift back up into life means so much accompllsbed for us all. There will be more such victims In these next months than ever before because, though more people are at work, the strain and privations of 4 years will take at the end their heaviest toll. Here In New York in the winter ahead there will be hundreds of thou- sands of men. women, and children sick, and many will die unless we give aid. ReUef agencies wUl supply food and shelter, but they cannot care for th« sick, nor can the hospitals take them all in. The Henry Street visiting nurses will be called upon to take care of the rest. All through the depression it has been so. Accepting cuts in salary cheerfully when ftmds were low, with a staff smaller than before and the number of their patients In- creased from 60,724 in 1929 to over 100,000 now in every quarter of Greater New York, without distinction of race or creed, they have given expert, devoted care to those who called to them for aid. I have known them and have seen them at work. It Is heavy work by day and by night — Into crowded tenement rooms and up and down dark tenement stairs. Many last year grew ill from the strain, yet still they kept courageously on. But they cannot do it without our support. Of the budget for this year more than half is now at least in sight, but unless we raise $390,000 more, then in the cold months ahead they will be forced to turn down all but the most urgent calls for help. Will you stand behind them now? They are worth it. for they have that inner force of which I learned long ago on the St. Bernard. One of them the other day told of a patient who had It. too — a little girl with wasted body, but with bright, black, strong little eyes, who for weeks had fought to keep alive and was at last recovering. " What do you want for Christmas? " asked the nurse, and the answer came like a flash. " I want my life back again ", she said. " Just you get me out of this bed and I'll tend to all the rest of it." And she will. too. She Is that kind. Let's give her back her life at Christmas. Let's not desert such children now. No matter how hard tt may be to give from Incomes that have dropped so low, let's try to keep on doing our parts in the slow and dangerous climb up the great cliff to brighter days. It's hard to be poor and out of a job. but it's awful to be sick as well So please give all ttiat you possibly can. EuTcar Pools. Kbw Yokx. Deoemlter 19. 1933. Mr. ROBINSON of Arkansas. In the New York Herald Tribune of December 33 there is an interesting sidelight cast on what the people of the country think of the President. The headlines are: Rooscvalt'i Mail T»n Times Any Predecessor's: 36,000 CtaiistmM Letters and Bundles Descend on the White House. Ah. Mr. President, when Christmas time came a few days ago there was a demonstration in this country that is well worth recalUng. From limit to limit of the Nation there were evidences of returning prosperity and happiness. The fact that the President was remembered by 10 times as many citizens as ever remembered one of his predecessors is a complete answer as to how the public regards him, an answer to the denunciations of the President by the Senator from Indiana. Mr. President, I could continue indefinitely quoting arti- cles by news writers and editorials from newspapers, ex- pressing opinions directly contrary to that asserted by my good friend, the Senator from Indiana, and contending that there has been a marked advance In national recovery. God knows things and times are bad enough yet, and all who are genuinely interested in our finding the way out should give their best cooperation and support. Of course, if we divide among ourselves needlessly, if we resort to bitter partisan politics, if we take advantage of every mistake that has been made — and there have been mistakes made and there will be mistakes made— if we capi- talize them, and minimize the good that has been done. Just to that extent we shall retard the advance of the American people toward national recovery. I have never been one who b^leved that prosperity is solely in the keeping of public ofllcers or is to be found alone in political measures. Everyone who has studied the course of the Nation during recent years realizes when the orgy of ^>eculation In 1929 broke and financial institutions began to cff to thmt moChen and fathen may now watch their children start achool, or venture upon the streeu. with a feeling of did not exist before. ^. , w ... *wa_ *. We have had trying times: at last daylight Is breaking through and I sincerely believe that this new year wUl bring to the of California a renewal of that old-time activity and the '- ment and peace that is our rightful heritage. jleople coi itent- Traocd in Iiic for the the belief ceptral- com- inetal. physical I . and f(T trace the be- of tumo\ er CoMMOorms TtTaw Acrrvx Dtramo 1933 — Coimucrs TzAM Total Thmxk Fou»ths of Buxxon Dollass By Jeerome Lewlne. president Commodity Exchane^e. N«w To«K. December 30— The past year — a notable one history of commodities generally — has been conspicuous activity on Commodity Exchange. Inc.. and has justified the of the organizers of this consolidated exchange that its ixed functions would prove of definitely greater value to the modlty producers and the trade than had the separate silk, rubber, and hide exchanges. Trading volume became most marked following the merger of the constituent groups under one roof on July has continued In large viMume. with relatively few interrui^tlons up to the present time. Increased prestige has developed exchange as its work and service of information to the came better known, and as the centrally organized facUll^es this market made jxnslMe a more rapid and efficient The consolidation was without precedent, and it creating what is now one of the largest commodity the world, and the only exchange on which are traded six commodities used or consximed throughout the Eastern and em Hemispheres. WLwrrEEW cotnrmixs ntcLtTDED Members now Include Important Onanclal and commercikl in terwU In 19 countries — the United States. Prance. England Hol- laod. Canada. China. Germany. Switaerland. Mexico. Japan, Bel- glum. Italy. Argentina, Australia, Czechoalovakla. Egypt, [India, Scotland, and Spain. The exchange is now carefully considering the possibilities for trading In other commodities. The addition of these would en large the scope and volume of trading substantially, and jivould •rixave the deairahle effect of further extending the benefits |of Its facilities to additional Industries and trade groups. The efforts of the national administration to raise comiiiodlty prices have been more or less simultaneous with the grov th In volume of trading In sliver, rubber, silk, copper, tin. and hlqes. resulted exchani ;es In m basic iWest- rUTTTBZS TSAOOfC GOOD govemn kental Trading in futures has been of unquestioned benefit to various industries and commodities through the system of " Ing " or price insurance developed by the exchange and its stituent groups. Thus far the exchange has by carefiil discipline and complete cooperation with the goverrunent4l thoritles avoided that public criticism which leads to Investigation. It has been our policy to cooperate in every way with the authorities and so to conduct the work of the exchange keep it free from the need for any investigation or the Oovemment. The unusual problems arising from the closing of the durltkg the banking holidays and from sharp price fluctvi^tions from time to time have been met without loss to anyone, several clearing associations operated in conjxinctlon with exchange have made this protection possible, and they answered every demand that has been made upon them, liveries, no matter how heavy, have been handled elQciently regulati on coirnucTS gain act [vltles oil thit In the ftrst annual report of the exchange covering its for the period commencing with the legal consolidation 1. 1933. and ended on November 30. 1933, I pointed out value of contracts traded in on the exchange aggregated mately $750,000,000. In rubber, silver, and copper the number of contracts during this 7 -month period far exceeded the totals for the 12 months preceding. Comparative flgiu-es for trading volume November 1933 and the same month a year ago show the of Increased trading since the opening of Commodity Inc. The Increase in silver trading from November 1933 to 1933 was 371.375,000 ounces. In crude rubber the Increase 113.900 tons. In raw silk it was 5,760 bales, in hides 6. pounds, in copper 15.400 tons, and in tin the increase was lOi < MTTLTIFLT eridenied degree by world, in The international character at the mattat Is beat the multiplicity of orders received from many parts of the partic\ilarly In silk and silver, and to a proportionate cf^per. rubber, hides, and tin. The exchange exercises no control over prices, but does dally maximum advances and decline. Volume of trading an^ gxiards set up for protection of buyer and seller are signlflc the need which the consolidated market fills, and this has been more apparent than during the recent period of world unsettlement. We can with reasonable assxirance look forward to a pro^nising year in 1934. both as respects trading activity and. perhaps petter. more stable prices. these hedg- con- self- au- mblic as to by excl anges The the have De- May the ap proxl- d4alt In entire in fextent Excl lange, November was 160,000 tons. repilate aafe- at of never wide (From the Washington Star, Dec. 34. 1983] Tbuvikc Brrsiivxss Sexk ts Wisconsw Dotuno Holjdats — Ch«I8T- MAS WCLCOMED WrTH CONVICTION BrmX TiMXS ASS ACTUAIXT Hzas By William T. Evjue Maoison. Wis.. December 23.— For the first time In 4 years Wis- consin welcomed the Christmas holidays with the conviction wide- spread that Ijetter times are not only on the way but are actu- ally here, and one of the ou-tstandlng factors contributing to revlvai Is the Roosevelt C.W_A. program, which has been providing a 11.200,000 weekly pay roll for families formerly on public relief. Reports from varloiis parts of the State show a thriving Christ- mas business, with the department stores in Milwaukee and other population centers exceeding last year's sales figures by as much as 100 percent. Industrial commission figures showing Increased employment in all lines are not necessary to convince that Im- provement has set In — crowded stores, busy streets, and the faces of the people tell their own story. LIQTTOK TAXES DELATED It Is now almost certain that the legislature. In session now for 3 weeks, will not pass a liquor taxing and regxilating bill before the first of the year. This week saw the Introduction of the sixth bill for regiilating liquor. Authorized by two conservative Democrate, the plan would apply virtually the Quebec system to Wisconsin, with sales by stores and a monopolistic State-owned wholesale agency. It is now apparent that the plan of Governor Schmedeman, which would have licensed liquor buyers at 91 a head and txirned virtually all the liquor revenue over to the localities, is doomed to defeat. The Helens bill, sponsored by a leading State senate Democrat. Is much more likely of enactment. It allows local option as to the permissibility of tavern over-the-bar sales and keeps all revenues for the State for budget-balancing purposes. One dark spot on the outlook in Wisconsin vms the sudden drop in the price of cheese from 10>4 to 8 cents. This 2 »^ -cent break set a lemrd for recent years and means the loss of hun- dreds of thousands of dollars a month to farmers and dairymen. Governor Schmedeman, who had sponsored " national cheese week " with a nationally broadcast speech, only to see the price of cheese skid during the " week ". blamed the drop on Secretary of Agri- culture Wallace and Wallace's cancelation of the Federal butter- buying program. POUnCAL CIXCLES ALIVK Political circles began to grow lively with the announcement of several candidacies lor major posts. Rumor also began to bring the names of State figures into the light as likely contcders in next year's political arena. Against Senator Bob La Foli-ettk, Jr.. the Democratic candidacy of Mrs. Gertrude Bowler, of Sheboygan, Democratic national committee woman, has been announced. Walter J. Kohler, former conservative Republican Governor, is re- liably reported to be ready to oppose Senator La Follxtte in the Republican primary. The State Democratic organization fliled a gap In the State com- mittee this week with the election of Joseph Martin, Green Bay attorney, to the chairmanship. The Martin election was considered a Schmedeman victory, and Martin is one of the Governor's stanch supporters. William B. Rubin, of Milwaukee, leader of the more progressive faction of Democrats, fought the Martin can- didacy but was voted down. Stokss in Indiana Report Large Sales — C.W.A. Phocrak Employs 100.000 Persons. Wfth Pat Roll or $1300,000 Indianapolis, Inb.. December 23. — A more cheerful atmosphere pervaded Indiana this Christmas season than at any time during the last 3 years. With thousands of persons heretofore unemployed cashing C.W-\. checks, stores throughout the State reported unprecedented Christmas shopping. One of the largest department stores In Indianapolis last Sat\irday turned the largest volume of business in a 5-year period. All through the week merchants augmented their sales forces to handle the constantly Increasing crowds of buyers. Nearly 100,000 persons were on C.W.A. work, and the weekly pay roll amounted to $1,800,000. In addition to that, the State high- way commission had found Jobs for an additional 26,000 persons, with a weekly pay roll of $200,000. Although an absolute check cannot be made yet, William Book, director of the State welfare department, estimates that the num- ber of those on relief rolls has dropped from a peak of 80,000 on November 15 to less than 50,000 now. One of the anomalies of the situation noticed by him. however. Is that demands for poor relief have increased under a mistaken Impression that a person must be in want before he can obtain a C.WJ^. Job. Another Indicator of better days is found In the Indianapolis bank clearings, which rose from $8,458,000 on December 2 to $10.- 053.000 on December 16. This was In contrast to 1932. when in the week before Christmas bank clearings scaled sharply downward. SOTTTHEAST RECORDS BlO BUSINESS GAIN A'TLANTA BANK CLEARINGS roR Week Ended December 13. 46.7 Percent Over Week in 1932 By Edwin Camp A-ruufTA, Ga., December 23. 1933. — Two Indices, taken in this section as imfailing, Indicate the tremendoiu business recovery that Is taking place in the Southeast. 1934 CONGRESSIONAL RECORD— SENATE 209 For the week ending December 13. as reported by Diin & Brad- street, Inc., Atlanta's bank clearings Increased 46.7 percent over the same week of 1932. This contrasts with an Increase of 7.8 In New York City and of 6.5 for the country as a whole. The increase was 17 percent more than that of any other city in America, Dallas, Tex., being the nearest with 29 percent. The second index is the Atlanta mule market. Even more accu- rately than bank clearings, the activity and the prices prevailing in these auctions are accepted as a barometer of agricultural con- ditions and prospects. It is a cash market, and farmers do not buy unless they have the money and an outlook for profitable use of the mules. Number of draft animals sold in the local market, which is the biggest In the country, has quadrupled that of last year and is the largest since 1926. Prices are 35 percent above 1932. (Prom the Washington Herald, Jan. 1, 19341 Fakmers Get Highkb Peices fob New Yeab — Bitting Powbe Already up — Psospbcts for Agriculture Best Since Depression Began (By Edw. A. O'Neal, president American Farm Bureau Federation) The American farmer faces 1934 with probably the best pros- pects since the beginning of the depression. Farm busrlng power has increased about 24 percent since the low point of 1933. and the machinery Is set up to bring about a marked Increase in prices for farm products during the next few months. The winter wheat acreage has been materially reduced; the cotton farmer will certainly drastically reduce his production by renting a portion of his crop acres to the Government; and no Corn Belt farmer can afford to reject the inducement offered by the Agricultural Adjustment Administration to keep fewer sows and grow fewer acres of corn. price rise expected With the market curtailment of production in prospect. It Is likely that the biirdensome surpluses that have borne down heavily on market prices will gradually disappear. Lower visible supplies will have a bullish effect on prices. Money is getting into circulation at a rapid rate in farm areas. During November more than $58,000,000 was loaned by the Fed- eral land banks, and the rate is constantly increasing. The Fed- eral intermediate credit banks on November 30, 1933, had out- standing loans to the amount of 9136,861.440, much of it in loans recently granted. Wheat benefit payments now stand at more than ♦7,000,000. The amount of money to be loaned on corn may reach $200,- 000,000. The corn-hog plan for curtailment of production will release possibly $350,000,000. DEBTS TAKE TOLL It Is true that a large part of all this money is being used, or will be used, to retire old debts, but a substantial part of it will go into new purchases. Even if all of it were used to liquidate debt, it would have a very definite effect in increasing the liquidity of banks and in increasing the velocity of the circulation of money, which will affect business and commerce in all farm com- munities. We must not Ignore the effects of the public works program that is being pushed so aggressively at the moment. The cash released here goes immediately into circulation, to the great benefit of the merchants and manufacturers. If we will add the number of workers on these projects to the number of farmers who will receive money from the Government or from some quasi-Govemment institution diiring the next 12 months, it Is likely we will find that a majority of the heads of families in this country will have participated in some way In a movement that is distinctly reflatlonary. BENEFITS MAT PTRAMID It is my belief that once agriculture, which is Industry's best customer In this country, is put back on its feet, we will see a revival in business much more marked than is generally expected. Should this occur, benefits to all the people will be p3rramlded in an ascending spiral, the exact antithesis of the downward spiral that wrecked so much havoc following 1929. Getting down to figures, the national farm income for 1933 will amount to around six and one half billion dollars. Total factory pay rolls will clooely approximate this figure, as they always go up and down together. In 1926 farm income and fac- tory pay rolls both exceeded eleven billions. [From the Washington Star of Dec. 31, 1933] HCARTCNING GAINS IN PRICES HELP DEFINITE IMPROVEMENT CTTCD BT President of Farm Chemical Firm (By Horace Bowner, president the American Agricultural Chemical Co.) The year 1933 has seen a definite Improvement in agriculture. Farm prices have turned upward, and the long downward trend of farm income has at last been reversed. Gross farm income for 1933 is estimated at six and one third billions, a 25-percent iscrease over 1932. Farm prices have shown substantial improve- ment, averaging 71 percent of pre-war on November 16, as com- pared with 54 a year ago and with the low p>oint of 49 In February of this year. This means an increase of 45 percent In a period of 9 months. Were the eyes of the Nation focused solely upon economic recovery, this fact would undoubtedly have aided greatly In accelerating the upward trend in general busines*. In what now appears to have been a prematiire buret of epeed. the farm price index roee to 76 In July, as compared with M In June. The inevitable receeslon mu followed by a slow. atmmOf recoTery. which U Indicative of a better baalc poaltlon In the prin- cipal farm crops. The problems of agriculture are principally two: First. low prices, which at times have barely covered production coats of even the most efficient producers; and, secondly, the disparity between prices received by the farmer and prices paid by him for the things he buys. PATMXHT8 ALSO RSLP Higher crop prices, as indicated by the 45-percent increase in the farm-price index, have brought a definite measure of relief to a hard-pressed agriculture; and this does not represent the entire gain in farm income, since benefit payments mside to farm- ers for taking land out of production are not included in these farm-price indices. Up to December 10 actual cash payments of $115,000,000 had been made to farmers in the first seven months* operation of the Agricultural Adjustment Act. Ttils total was paid directly to wheat, cotton, and tobacco farmers, in return for acreage reduction contracts. No figures are available at this time as to the amount of money advanced to cotton and corn-hog farmers on the crops which they have sealed in warehouses as security for loans. It now appears, however, that the Government will be called upon to advance only a part of the funds provided for this purpose, as price improve- ment is encouraging private agencies and local bankers to lend more freely on such collateral. Summing up the agricultural operating statement for the year, we find an increase in farm gross Income slightly in excess of $1,000,000,000, of which about 10 percent is accounted for by Gov- ernment cash benefits for acreage reduction. On the expense side of the Income account the 1933 crop year will show exceptionally low production costs. Pressure to reduce local taxes has also resulted In substantial improvement In that phase of the farmer's overhead expenses. Machinery for the adjustment of farm-mort- gage indebtedness — which, as a matter of fact, has never been disproportionately heavy — is now operative, with the result that this phase of the farmer's burden has for the most part likewise been provided for. As a result, sentiment in the principal fanning areas is probably better today than at any time in the last 3 years. Retail and mail-order sales reflect the improving situation, and, in ^ite of vehement political expressions on agriculture's behalf, 'he fanner is today In a much better frame of mind, as indeed he has definite reason to be. held CONSKRVATnn The thinking farmer — and In my experience he is In the ma- jority— ^realizes that in the face of this improvement he has much to lose and little, if anything, to gain from extreme inflationary measures. Most farmers are conservative, using that term in Its truly constructive sense; they realize that printing-press inflation would be apt to raise the prices of the things they buy Just as rapidly as the prices of the crops they sell. This point of view probably accounts for the more temperate recent utterances of the extreme Inflationists. Reverting now to the second major problem of agrictilture. the disparity in the purchasing power of farm crops, we find that on November 15 the price of things bought by farmers was 117 per- cent of pre-war, as compared to 71 percent for prices received for their crc^w. Thus, the ratio of prices paid was 61, compared with 71 in July and 49 in February. Between February and November there has been a 25-percent Improvement in the farmers' relative purchasing power. There still Is a long way to go to reach a theoretical parity of 100 percent for this ratio, and as compared with July, some ground has been lost. But it cannot be emphasised too strongly that monetary problems have no relationship to the relative purchasing power of farm crops; all of the emphasis placed upon so-called " inflationary measures " advanced In the interest of agriculture has solely to do with prices received by the farmer for his crops. The fanner has nothing to gain from extreme Inflation, wlilch would not improve the relative position of the fanner. This problem of the disparity in farm purchasing power is one of the most stubborn with which the Nation has to deal. It has been several decades in the making, and it is unreasonable to expect an Immediate solution. Frankness and candor in' explain- ing this to the farmer are imperative. Now that we are em- barked upon a far-reaching program of crc^ curtailment, it la necessary, regardless of one's views of the economics of that ex- periment, to give It complete support and cooperation. But it should be pointed out at every importunity that unsound inHa- tlonary measures will only confuse the situation and prevent us from obtaining a conclusive result. FOBBOir MSB a lis MBEBBU Meanwhile, the farmer's best Interests will be served by putting the maximum amount of ingenuity and energy into the task of reopening foreign markets for American crops. High tariffs and drastic trade regulations continue to exert an adverse Influence. While trying to reopen old markets let us try to find oUaers. Academic dlsnisslon of a policy of self-eontalnment is a waste of time, for we have by no means demonstrated that we can effectually curtail production in the presence of a rising price level. As estimates now stand, the acreage of crops harvested in the entire coimtry during 1038 was about 8 percent less than in 1082. T.xxvm- -14 ' * J i I I # arley, were primarily responsible for reduced total output. Nature herself did a pretty good Job in Improving supply and demand relationship in these crops. Mts fpirm the [From the Washington Poet, Dec. 31. 1933 J Waoks Jtmp 25.6 Pi«cxnt Sinck Junc to was re- 1han Oct< ber, The wage rate increased sharply since last June, accordln|; the Business Conditions Weekly, when the lowest point reached during the depression. Factory employees In June eelved an average of 41 8 cents per hour, 27.2 percent lower the 1929 average of 57.4 cents per hour. Prom June to wage rates showed an increase of 25.6 percent. October amounted to 52.5 cents per hour, only 8.5 percent less tha^ 1929. The rise in wage rates was offset by the cut In WOTklng hburs from 42.6 hours per week In Jvine to 35.8 hours per weel; October. Weekly earnings In October were $18.80 as against $17. June, an increase of 5.6 percent In earnings per week as with the Increase of 25.6 percent in earnings per hour, weekly rise tn earnings was not sufficient to offset the 9.3 rise in prices, and the wage earners' purchasing power was cofise- quently lower in October than in June. On the matter of wage earners the Business Conditions W^kly says : " The wage earner in Octot>er. however, was consider ably better off than In March, when his weekly earnings were at lowest level of the depression." w^ges in irs m .8i in comp ired rhis per cent the (Pram tbe Wasblngton News. Dec. 6, 1933] Th« G.OP. Attack If there is anything the Roosevelt Administraiion needs It is Intelligent criticism. The President himself has said eo. ] t Is vuxfortimate that the attack by the Republican National qom- mlttec does not meet this need. Chto^lers, The Republican campaign pamphlet, entitled " Tories. Dead Cats, Witch Doctors. Bank Wreckers, TrsJtors ". lacks vlctlon. It hides behind criticisms of the administration certain Democratic newspapers. The glpier one than that of 1932 Christmas last year dawned on the homes of 12.000.000 uiJem ployed. Economic chaos, hunger, child labor, farm unrest. Insecurity were ugly realities. The Nation's purse was at flattest sU e In years. The Roosevelt new deal was only a dawn- ing hope. The sour face of prohibition haunted the byways Today more than half of thoee Jobless are back at work 2.509.000 on the pay roll of private Industry, some 4.000 OOO Government emergency work. In addition more than 'soc yoimg men of the C.C.C. have turned from biuaming to wor : the woods In the midst of Gods own Christmas trea The possible Christmas present, freedom from toil, has been Into the stockings of more than 60.000 child workers The Government is fighting want with a billion doUars' of suxplm farm products. Banks are by way of belns securities more secure. Into the flattened American is being pumped new industrial buying power at the rat^ •3.000,000,000 a year. The weather. ' Triple A", and «^r have brought amlles to the farmers' faces 1^ «rirtt>^g ^ liank its spme on ,000 m best droiped wtirth «ier, pocketlfook of things liast Janu.\ry 8 scme- $1,000,000,000 to their Incomes. And. In 24 States at least, we may drink to this and merrier Chrlstmases from a wholly legal wassail bowl. [Prom the New York -nmes. Dec. 29. 1933) MiDDUt West akd New England Noti: a Steady Improvement in Business — Chicago Bavks Strong — Thobotjch Ovebhauling Early in the Slump Aided Recovery — Retail Sales Show Gain — Mail-Oroex Trade. Based on Parcel-Post Rettuns, Ahead of 1932 By S. J. Duncan-Clark Chicago. December 28. — In the middle- western agricultural and industrial area, of which Chicago is the financial center, the recovery from depression has been sufficiently steady and con- servative to give excellent promise for the coming year. In large measure this is due to the thorough overhauling which the bank- ing situation received during the early years of the slump. The Christmas trade has been a fitting climax to 10 months of improvement. Marshall Field & Co. and Carson, Plrle. Scott & Co. reported that the physical volume of merchandise handled in the retail stores on several days was actually larger than in the corresponding period of 1929. The December business of the latter firm broke all record.?. Output of electricity in the Chicago public-utility district, which Includes part of the northern end of Indiana as well as part of the factory area between Chicago and Milwaukee, closed the week of December 16 only 3.6 percent above last year, but was at the highest level since January 9. 1932. In general, the local use of electric power has been running well In excess of 1932. PARCEL POST HEAVY Outgoing parcel-post shipments have been running 15 to 18 percent above the corresponding weeks a year ago, being about 60.000 sacks a day. Incoming shipments averaged about 20.000 sacks dally. This, of course, reflects the mail-order sales of Sears. Roebuck & Co. and Montgomery Ward from the Chicago headquarters of this district. The steel mills south and southeast of Chicago have been Increasing their rate of operation rapidly, the independents lead- ing, and are from 2 to 3 weeks ahead of the usual seasonal upturn. Predictions are made that there will be a slight sagging after the first of the year, the current rise being partly due to the rush to specify on the favorable terms available in the fourth quarter. Still later, beginning February 1, local steel men predict a sharp increase to still higher levels. Statements have been made that the national rate should reach 40 percent of capacity at that time. The meat-packing Industry — in some respects the largest indus- try of the city — has at last reversed its years of annual inventory loss and is beginning to show satisfactory profits. Swift & Co. — the largest of the " big four " packers — reported a $500,000,000 business In the fiscal year ended October 29. with a net Income of $10,149,482. Although the future trend Is more likely to be upward than downward, the burnt fingers of other years induced the management to set aside $4,267,000 of Income as reserve for possible price fluctuations. The packers do a business In fresh meats all through the year, but their heaviest packing season Is the winter and most of the ham Is sold in the late spring and summer. Sales of automobiles for the month of November— the latest complete month available — were 147 percent above a year ago The figures prepared by the Federal Reserve bank of Chicago cover the greater part of Illinois, Indiana. Iowa. Wisconsin, and Michigan. There was a heavy drop from the previous month, but the seasonal recession was far less than last year New cars on hand are about 30 percent below normal, while used cars— that had almost vanished from the market last year— are begin- ning to reappear in fair number as new cars are purchased Good used cars shoiild be in considerable demand when prosperity returns. f f j BANKS in good CONDmON The great advantage of the Chicago area was that Its banking groups started upward from a solid foundation. The extraordi- nary coUapse of the Insull fortune In 1931. which made so much collateral worthless, together with a tax muddle that wrecked the real-estate market by taxing 1931 on 1929 valuations with the double burden of lost years thrown In. brought on the crisis earlier than In the rest of the country Bejcause of this all the really doubtful banks had closed In the l^r.^^^"?*.^^^ and June 1932. After the moratorium there ^it i^«,^f^^ . "f ^^'^ '*,""" "^^ examination for Federal de- posit insurance. Just completed, showed one of the cleanest reports Wil o^ir^^ Considering that It applied to 56 banks Inste^ of lU^^?J^tS°'l°^V ^^29, that is not surprising. The closed banks had been for the most part small neighborhood Institutions. dJ^tS S^S*Jft ^^" ^°^ *'** '"^^ ^"^^ ® percent of the total R?r w^f^^l*" r^'^r^',^^"'* district, the cash from the ^««^■tA^,^>^n^^*' '°'" 'iq"«dating dividends, which will run ,^ ^* LV*^;"^ * ^*y ^^'' January 1. should provide an S?r io «„^ .T'^t.*^ -"^^" recovery. The bulk of this money wUl go outside Chicago, for the banks here tliat are in a strong ^Ll^^^^?! the most part still trying to reorganize and have delayed accepting the assistance .rf!^°«*^t^ f^'^. *° *^* Chicago area, and the automobile men are so optimistic in regard to the coming season, in private con- 1934 CONGRESSIONAL RECORD— SENATE 211 versation. that their predictions can hardly be Ignored. Rather curious, however, is the refusal of the most cocky sales manager to go on record In public with the statements he makes to his sales group. The Middle West Is chary of forecasts, but It is already showing substantial vigor In recovery from the extreme bottom of the depression. [From the New York Times. Dec. 29, 1933) Ten-Percent Gain Noted — Six States Anticipate Increase in Volume in Halt Year — Bic Jump in Employment — Octobee Pat Rolls 25 Percent Above 1932 — N.R.A. Codes Satisfactort By F. Laurlston Bullard Boston, December 28. — New England enters the new year with sound warrant for good hopes of the future. These six States have been hard hit, but at no time did they slide as far into the depths as did other sections. There is a long climb ahead, but. speaking In general terms and with due regard for some bad spots, a real start has been made, and the upward trend is expected to con- tinue. The year ends with a volume of business 10 percent In advance of last year. This volume should be Increased, at least during the first half of 1934 and probably through the year. New England stands predominantly for textiles and shoes. The consumption of both raw cotton and raw wool during 1933 has been much greater than In 1932. The 1933 production of foot- wear for the entire country is estimated at 350.000.000 of pairs. New England would account for a third of this total. This is a remarkable showing. Only once or twice has it been surpr-ssed. There doubtless will be some recession from this high 'evel in the coming year, but production is expected to continue in large quantity. The smaller Industries, of which there are a great number In these States, have had a much better year than in 1932, and they are looking into the future with considerable confidence. EMPLOYMENT HAS INCREASED Since last March there has been a heavy Increase In industrial employment in Massachusetts, with only a small decrease in No- vember from the high of October. The Index stood at 53.9 In March: by October It had advanced to 76.5, and the latest ratio available, that of last month, is 72.9. The October pay rolls were a fourth higher than for the same month of 1932. Employment In boots and shoes in that month was 90 percent of normal; in cotton goods 95 percent, in woolen and worsted goods nearly 104 percent, and in knit goods 108 percent. The situation in the manufacturing centers of southern New Hampshire and Rhode Island is similar. These, to be sure, are industries which produce consumers' goods; employment in industries producing capital goods is lower. As of November, 70 NH.A. codes have been applied to New Eng- land Industries which are of rufflclent magnitude to find a place In the Federal census of manufactures. Any study of these codes will indicate how diversified are the Interests of New England, a circumstance of major importance for any stabilization of pros- perity, and always the recreational Industry has to be reckoned as a fundamental resource In a class by itself. A single metal code Is applied here to no fewer than 26 separate industries. Of all the employers of labor In this section four fifths up to Novamber 1 had signed codes, while of the grand total of 2.700,000 employees nearly 1.260.000 were working under codes. The textile operators are openly rejoicing over what the codes have accomplished for them in the equalization of competition. The shoe code gives general satisfaction. RETAIL TRADE VARIES The retail codes apply to 89.5 percent of the entire number of retail establishments and cover 328.000 employees, or 89 percent of that total. Retail volume in Boston for the latter half of the year was about the same as in 1932. and Springfield and one or two other cities also have shown no gains compared with a year ago. On the other hand, there have been large gains in the dis- tinctively manufacturing cities; for example. Lawrence reports a gain for November of 21 percent; Fall River, 18 percent; Holyoke, 15 percent; New Bedford, 13 percent; and Lowell, 12 percent. Nine of the reporting cities showed small losses. It is a fact, however, that retail distribution has been better maintained within New England than without. By and large, the credit not only of the six States but of the municipalities has been well protected. In most of the States some banking readjustments have been necessary, Rhode Island being a notable exception. Vermont is clearing up its banking troubles slowly and as yet has made small use of the Reconstruc- tion Finance Corporation funds available. The stagnation of the building industry, now beginning to show some signs of recovery, has reduced heavily the demand for Vermont timber, granite, and marble. The fruit and dairy industries have fared somewhat better. Maine has some special problems to be solved. Due to welfare demands and make-work enterprises, which have reduced greatly the ability of municipalities to pay in full the taxes owed the State, the State Itself is employing various devices to make ends meet. The failure of a single tnist company, which operated 42 banks in 35 towns and cities, damaged public confidence a great deal, but this condition also is in process of rectification. Indus- try on the whole is doing well in the Pine Tree State, esp>ecially textiles, shoes, and canning. The potato country has had some- thing like a boom. The tourist business was good, but off some- what from the high levels. Like the rest of New England, how- ever, Maine is looking forward with renewed hopes [Prom the Washington Star, Dec. 24, 19S31 Christmas Trade Reported at Best Level Siko 1928 — Spimrr of Gloom Swept Away: Pay Rolls and Released Deposits Help — Industry Continues Unseasonal Advance — Aid for Mortgagees and Holders of Mortgage Certificates Talked in Coming Year (By Charles P. Speare) New York. December 23. — Reports from every direction em- phasize the volume of Christmas buying, some placing it at the greatest since 1928. Several factors are responsible. First is the change in the mood of the public. A year ago It was fearful of the future because of the known condition of the banks. This has been dispelled by the approach at the deposit- guarantee plan Second is the actual Increase in the buying power In the hands of the American people by reason of the gain in employment and the higher average wage of those whose work had not been inter- rupted during the depression. Third is the releafe of large sums of money by banks that had been under restrictions since March or whose period of partial service to the public antedated the moratorium. A year ago there was a general expectancy of still harder times ahead. Now there is a feeling that the tvirn has come and that while money may not be plentiful In 1934 there will not be the necessity to live on reserves that had made f ) many cautious in their spending. The social philosophy of the' Roosevelt adminis- tration may be contested by those who cannot adjust their minds to it. It certainly has extravagant features. It has. however, de- veloped a new and healthier psychology among the mass of the people. industrial CAINS UNSEASONAL The major industries exhibit an Improvement that is contrarj- to the season. This is a proof of fundamental gains in a direction that has been slow to respond to recovery mechanically or natu- rally inspired. The iron and steel ratio of production has again risen sharply to the figure of 36 percent of capacity, comparing with 32 percent at the end of October, when the drop from the high August ratio of about 55 percent was taking place. Power and light production does not satisfy those in the indus- try, though it holds over 5 percent above the level of last Decem- ber. Many of the railroads are moving more revenue cars of freight than at the end of 1932. The building outlook Is better but greatly restricted by the mortgage situation. Itself slowly feeling the benefits of widening areas of emplojrment. For the last 2 years the Reconsti-uction Finance Corporation has been centering its efforts on the railroads, the banlcs. and finan- cial institutions, and other Government agencies have been cre- ating relief for farmers, providing more profits from their crop* and helping them to save their homes. MORTGACESS NECD An> It is not unlikely that during 1934 aid from these same sources win be given to distressed mortgagees and holders of guaranteed mortgage certificates whoaa pUght, in many cases. Is more seri- ous than that of those already relieved. If the figure of •lO.OOa- 000.000 in outstanding mortgage certificates is a correct one, tSin $5,000,000,000 represents the deinedatlon that holders have al- ready suffered, in addition to their loss of Income. The remain- ing equity is important enough to try to preserve. The same is true of the investment that institutions and indi- viduals have made in the past 20 years in municlp>al bonds. The total par value of municipal debt is •19.000,000,000. llie greater part of municipal securities outstanding are today without a market. Bids for them are nominal; often at less than half the original cost price. Here Is another situation to which attention must be given next year. It is a companion of that in real estate. Both are domestic matters, and, therefore, may be approached sympatheti- cally by those who believe in short shift for the holders of for- eign dollar investments whose position was bad enough from the defatilts of South and Central American countries and is now made worse by the steady refusal of Germany to meet full interest payments In cash. n'bCESSITT QUESnONKD When one considers all of the depreciation that has taken place In the important groups ot American and foreign InTestments. one is inclined to question the necessity for further adjustment in the dollar value in order to lift the burden of debtors. The meaning of the $660,000,000 which the R.F C. has advanced to the banks on collateral and the $1,000,000,000 or more that it proposes to lend them in the form of preferred stock or capital notes is that this sum represents part of the depreciation in their invest- ments or In commercial loans which is now to be absorbed into • new capital structure. Not a small part of this depreciation, which has devalued the portfolios of the banks, is due to the way in which debtors have violated their contracts to pay and the increasing popularity of this procedtire since the Unified States repudiated her own gold agreements. Advance Indicated xn Tftaos Acnvmr bt Ifooor's IiroBS New York. December 33. — Statistics appearing during the last week indicated a higher rate of business activity, according to ' ■%' 1 212 CONGRESSION Moody's Index nfirtires. for frelRht-car loadings, electrlc-powfr pro ductlon. and Bt«el Ingot output These Index Qgiires are adjusted for seasonal variation — If the change from the previous we^k should coincide w normal seasonal change, the mdex figure would be \inchan|;ed. that la, with the IjiSi wwk. . .. Previocj-' ««el( Morih 3^0 Ye»r sso 1033 hich IV33IOW ('ar InAd- incs 50.5 V^3 39.1 S5.5 SI.7 4S.S Elect rie 101.3 loas 101. S M.4 1W.2 88.7 StMl 4«.0 44.1 36.0 21.1 78.1 U.5 1928 w«elily av«r»s» equab 100. Utah Homs Loaits Total $881.205. 10 — DwixuNsa or 353 FiKiuzs Saved — C.W A. Chxcks Bkino Real Chzxb I Prom the Washington Star. Dec. 24, 1933] Salt Lakc Crrr, Utah, December 23. — Home loans hav^ saved the homes of 353 famUles in Utah at a total cost of $881 205.10. which means that more than 1.5O0 people have had the jurden of worry lifted from their shoulders Just a« winter set In, Utah has been enjoying one of the mildest winters on record. What early this season generally is snow was rain this year, and there Is scarcely enough snow now for a schoolboys' battle. A) id the weather has l>>?en w/sta and balmy. This help from natvre has been a boon to the relief organizations which have prevented actual suffering Tlie strain has been heavy on those w^ bad to give, but the contributions were made. Real cheer for Christmas has been brought by the JC.W,A. checks which the heads of families now are drawing inslead of allotments from the relief warehouses. There are 6,000 C.W. A workers In Salt Lake City and many more throiighout th^ State, and all are doing useful work. One angle of the work which Is benefiting Salt Lalde City especially Is the mosquito abatement work. The flats n< ar the Great Salt Lake, and only a few miles from the city, ha\e been a breeding place for mosquitoes for many years. Plans have been drawn and every preparation made for the actual drainage ql these lands for several years, but the work was not started. AL RECORD— SENATE January 8 Com- bioei W.fi 67.0 65.6 57.7 «.- sas ULTKACONSCBVATrVK Pennstlvakia G.O P. GoiNC P»ocaESSivi ; Deal. Rkfublican Deteats, and Democratic Fbass Cause Face HAaaisBmc, Pa., December 23. — Pennsylvania's Leglslati^re years dominated by an ultracon.scrvatlve Republican ration, has reversed the stand it took 8 months ago in session upon a number of Important progressive issues. Influence of the new deal at Washington, Republican feais in last month's elections, fear of Democratic success 1934 State campaign, and the Democratic program of legislation combined to accomplljih the about face. BAJt CHILD LABOB Both houses voted this week to ratify the child labor ment to the Federal Constitution. The senate by a margin vote saved the resolution by defeating a motion to recomml house suspended rules and discharged a committee to force on the sume measure. Half a decade ago Pennsylvania the same amendment decisively, but since then some textil ufacturers who opposed it at that time have defended the biirty of congressional action on child labor regulation as means of reducing competition with Southern States. By virtually unanimous votes both houses adopted a plan age assistance. That achievement is little short of a revolution In this State In the past such proposals emerged from committee: if they did, they received feats. The new plan, effective December 1, 1934, proposes $30 a month to indigents over 70 years. Estimated $12,000,000 a year at first, the money is to be provided from of State liquor taxes. for >rganl- regular de- in the liberal $mend- of one ;. The action Injected man- possi- only the A sports are pro- (From the Washington Star, Dec. 24. 1933) N«w JnsET Puts 103.000 m C.W -A.— Roads. Puols. and To Be Impeoveo Under Program By Edward M. Gilroy Trenton. NJ., December 23.— More than 103.000 person: working In New Jersey under the Civil Works Administrate n gram. Thr State exceeded its quota of 90.000 ^ba by a sti^talned drive of State, county, and municipal ofltelals. A new class of workers was created overnight and the direct emergency relief rolls greatly reduced. John Colt, of ton. SUte director of CW.A. and State relief admlnlsti. well satisfied with the success of the profrram. Despite the Ity with which the workers were placed, he declared, great a, taken that no wasteftil expenditure of public funds would merely to create jobs. MOST quotas reached "After a careful stirvey of the SUte ", Colt declared. " I in saying that the tsixpayer will get his money's worth C.WJL program. Some projects have been turned dowxk." a re — New About Only 2 of the State's 21 counties — Monmouth and Sussex — failed to reach their employment quotas. Several far exceeded the allot- ment. Burlington employing three times its quota. Work being performed is scattered throughout the State. Much of it Is being directed toward road repairing, park improvements. and airport development. Newark airport will be considerably enlarged and runways improved if the program is carried out. One of the major public benefits under the C.W A. is in re- cataloglng books of tlie Newark Library and reblnding its collec- tion. The city could not aflford to undertake this work, but the large Investment in the library Is being protected by C.W_A. funds. Curtailed Federal. State, and municipal services are being restored to their former status. Two Hundred and T^irtt-Two Plans O.K.'d tn Sottth Dakota — Relict Projects Expected to Put Bio Sum Back Into Circu- lation Siotrx Falls. S.Dak., December 23.— A total of 232 South Dakota relief projects have been approved and reported to officials at Washington, it was announced by J. B. Longrie. assistant State civil works administrator. This number includes 44 not previously announced. Of the total number, 168 are rural-credit projects, while less than a dozen call for construction of dams on State school lands, leaving about 60 which originated with local com- munities. Sioux Falls and Minnehaha County, of which Sioux Falls is the county seat, are being benefited by the relief projects. Monday of this week 550 men were put to work on civil-works projects la Slotix Fails and the county. It was announced this number will be Increased to about 1.600 when work Is In full swing on all the projects in the city and county, with a pay roll amounting In the aggregate to many thousands of dollars each week. The men who have been put to work, and othera who will be given employment on the civil-works projects, had been Idle many months. The money they will receive in wages Is regarded as cer- tain to find its way Into circulation, with a resulting improvement in the business of many Industries. The Public Works Admlni.stratlon since early In September has allocated $1,422,000 for various projects In Souin Dakota, W. F. Cochrane, public works engineer for South Dakota, said. M. A. Kennedy, State relief administration statistlciam, an- nounced that the use of State beer revenue for livestock feed has been discontinued and Federal funds are being used instead. To date the State has expended $35,946.39 of Federal funds for pur- chase of livestock feed, and large additional sums will have to be spent during the remainder of the winter and early spring At one time recently the State relief administration wired for 200 additional cars of corn. All the grain and hay purchased with Federal funds, under direction of the State relief admini.strator. are being distributed from concentration points In different parts of the State of old- I leg islatlve seldom thumpjng de- to pay O COS'C profits State's : *rlnce- Is rapld- was result £4el safe in the Nebraska Reports Increase in Trade — C.W.A. Jobs and Higher Bank Clearings Foretell Better Business Omaha, Nebr., December 23. — Increased bank clearings, thou- sands more provided with work by the Civil Works Administra- tion, satisfactory betterment in retail trade, and numerous re- ports of improved business in the remoter parts of the State all contribute to a feeling of well-being such as this agricultural State has not experienced for many months. Nebraska farmers have not yet begun to take advantage of the corn loan program In numbers. The local R.F.C. corn loan office, which also serves Iowa, has devoted its services to farmers of that State almost exclusively so far. for Iowa got in legal line earlier. When the Nebraska farmers start cribbing their corn and obtain- ing loans on a 45-cents-a-bushel basis, there seems assurance that the holiday feeling will continue through the winter. And It is not without the realm of possibility that Nebraska farmers are not in such need of these loans as was supposed. In the spring the public-works projects, already approved, will get an early start. State N.R A. officials assert. They are many In numl>er. planned to follow the C.W.A. program that will thli: out around Marct>, according to plan. CLEARINGS UP 30 PERCENT Omaha bank clearings for last week showed an increase of 30 percent above the same week a year ago. Allen T. Hupp, secre- tary of the Omaha Associated Retailers, reported increase in retail trade about 5 to 10 percent in dollar volume. The Omaha World- Herald reported an .increase cf 5.675 lu its State circulation from August to November. Job placements in the C.W -A. program this week In 83 out of 93 counties In the State totaled 43,463 compared with about 31.000 a week ago. At the same time the registration of unemployed reached 50,955. A rush to register has been noted, since only registered men are given Federal program jobs. (Prom the Washington Sunday Star, Dec. 24, 19331 Gain Continues in Steel Industry — Department or Commerce Stresses Importance in Weekly Trade Review Continued improvement in the steel Industry featured the do- mestic Industrial developments during the week ended December 16, the Commerce Department reports In its weekly summary of the situation. 1934 CONGRESSIONAL RECORD— SENATE 213 A further gain la Indicated for the current period, with the ] operating rate as of December 18 estimated at 34ui percent of capacity, or 2.7 points higher than on December 11. This com- pared with the low of about 25 percent In November and with 13 percent In the same week of 1932. Part of the recent Improve- ment is traceable to deliveries on fourth -quarter contracts which specify prices below those announced for the first quarter of 1934- POWEB OUTKUT RISES Eectrlc-power production increased by more than tfie usual sea- sonal amount, although the percentage gain over a year ago was 5.2 percent, or 1.4 percent less than In the preceding week., owing to the sharper Increase In the corresponding week of 1932. Auto- mobile production Increased about 30 percent as three companies resumed assemblies. Output of 16.800 units, however, compared with 30.600 a year ago. continues to reflect delays In the produc- tion of 1934 models. Fisher's Index of wholesale commodity prices advanced to 72 percent of the 1926 average, or 0.2 of a point below the high of the year. The increase was the result of a further rise in the Donagrlcultural group, as the combined Index of agrlctiltural products remained unchanged. The index of bond prices moved higher for the third successive week and was only 1 point below the figure for the first week of October. STOCKS XBBCCULAX Irregular movements on the stock market result«d in a rery ■light change in the index. The outstanding loans of the report- ing member banks declined last week to the lowest figure since the week of July 1. as a result of a further drop of (66,000,000 In " all other " loans. Rceerve-bank credit outstanding Increased by $62,000,000, mainly through bill purchases. Government securities held by the reserve banks have remained substantially unchanged for the past 6 weeks. The dally average quotation on sterling exchange was 3 cents lower for the week at $5.09. Short-term Interest rates ad- vanced slightly, owing to seasonal influences. Commercial failures declined, the total for the week being 260, as compared with 590 In the same week of 1932.^ Hoc Prices Foxce Upward Activelt — Advance oe Pxjllt 25 Cents ON Choice Medium Weight Offerings Shown at Chicago Chicago. December 23. — The hog market displayed a burst of activity today In the limited prehollday dealings, and prices advanced fully 25 cents on choice medium-weight hogs. The top swung up to $3.75. Receipts of 21.000 carried 19.000 direct to packing plants, and all interests bought freely because of the impending holiday. Shippers took 1,000 head, about the heaviest purchases of the week. Medium weights were In demand and sold at the maximum advance. All others sold from steady to 10 cents higher, with the bulk of all hogs going at $2.90 to $3.65. Cattle were nominally steady and generally 50 cents to $1 higher than last Saturday. Sheep were also nominally steady and mostly 15 cents higher than a week ago. Home Consthuction Contracts Mottnt — Total for First Hait or DECEurxR Exccxos Figure for Entire Month Last Year New Tols, December 23. — Contracts for residential building during the first half of December In 37 States east of the Rocky Mountains, totaling $13,629,200, exceeded by 5 percent the similar contracts for the entire month of December in 1932, it was shown today by F. W. Dodge Corporation reports. L. Seth Schnltman, chief statistician for the corporation, called the Improvement " the most dominant favorable development on the domestic economic horizon In many months." The Improvement shown was universal throughout the territory east of the Rockies with exceptions in upstate New York, the Southeast, and the St. Louis area. Significant Increases occurred in the metropolitan area of New York, the Kansas City district, and Texas. " While the Improvement Is rooted In the accelerating processes of the Federal program of public-works construction. It Is Im- portant to remember that normally it Is residential building that provides the stimulus to construction generally and to business activity as a whole ", the statistician said. VmciNiA Cheered bt HoLmAT Sales — Danville Reports Increase or 75 Percent Dtte to Tobacco Gains Richmond, Va., December 23. — Santa Claus, that rotund old fel- low, is doing his part toward driving Old Man Depression out of the Old Dominion. Business Is up, away up, say the merchants who report sizable gains in holiday sales and abnormally large staffs of extra workers to care for the needs of shoppers. All cities report increases in buying volume, ranging from slightly above last year's sales at Norfolk to an Increase of 75 per- cent at Danville, where tobacco prices are high and there's money In the growers' pockets. NORFOI.K avoids LXTLL Norfolk's slight Increase is regarded as outstanding, however, In view of the fact that the fleet is on the west coast this Christmas, depriving Norfolk merchants of the handsome holiday trade with which the middles heretofore have favored them. Another signifi- cant factor is the sharp Increase in cash purchasing. Ctainvllle's amazing 75-percent increase set the pace, but other cities showed substantial gains in unotScial surveys. Richmond merchants reported an Increase of approximately 30 percent, while Lynchburg and Roanoke conservaUvely estimated business In- creases of 20 percent over the last Yule season. One Roanoke merchant reported that his force was four times as large during the holidays as ordinarily. Some firms which ex- panded their forces under MHA. agreemenU reported that they needed no extra help. SHXPBTrXLDINC IMPROVSS Unfavorable weather at the start of the week hurt trade condi- tions in some cities, but several reported that the rains fsUed to deter the bundle-laden holiday shoppers. A pick-up In the shipbuilding industry, with the proq>ect of nor- mal emplojrment within several months, brought an improvsmsnt in the Christmas business at Newport News, observers said. At Bristol substantial increases were reported in the boUday trade. (Prom the Washington Post. Jan. 1. 1M4| Tajcpatebs Win New Tbas's Out or 130 Miulioms— Cttts nt Oaio- LINE AlTD DiVlSKlfO LCVISS ARE BmDCTIVE TOOAT Automatic discontinuance of $130,000,000 In Federal taxes started the new year off right last night for some taxpayers who srs assured of relief from another $80,000,000 in specUl taxes later In the year. One half cent of the 1 1/2 -cent Federal levy on gasoline and the 6-pcrcent tax on dividends passed with the old year at mid- night. Congress having specified when it put them into the Recovery Act that they shoxild cease on January 1 after the repeal of the eighteenth amendment. On next July 1, for like reason, the tax on corporations of $1 for every $1,000 of capltaliztton, and the 5-percent levy on corpo- ration profits in excess of 13 ^ percent of capital structure, will be discontinued. The estimated annual yield of the extra half cent gasoline tax was $62,000,000, and of the dividend tax, $70,000,000. The capital stock and excess-profits taxes together were figured to bring In $80,000,000. EXPECT $470,000,000 ON LIOTOR A means of recapturing this $212,000,000 and providing an esti- mated total of $470,000,000 through Federal liquor taxes has been provided for in a bill which the House Ways and Means Committee will present to Congress next week. The tentative measure, approved more than a week ago, after Joint hearings with the Senate Finance Committee, calls for a $2- a-gallon tax on distilled spirits — ^90 cents more than the existing levy. A reduction from $6 to $5 a barrel in the rate on beer is provided, and the present tariff rates, Including $5 a gallon on spirits, are retained. Varying excise levies on wines are Included: blended and rectified liquors will have to pay the existing extra 30-cents-a-gallon tax, and fioor stocks of qiirits the 00-cent dif- ference between tlie present $1.10 tax and the contemplated $2. WIU. TICHTEM tax ENrORCXlCKNT Drafting also will be completed, probably next week, of the other big 1934 tax measure, a revision program counted on to bring the Treasury up to $270,000,000 more in each of the next 2 years, principally through tightening up of administrative pro- visions of the income-tax laws. NUA. Invxntost Shows Cobks Aid 30,000,000 — Bsigrt Future Also Seen as TiKaders Contutox to Flt Saolb In a year-end Inventory NJ£.A. announoed yesterday Its codes cover a preponderance of American industry and regulate work hours and wages of 18 to 30 million workers. In just 6 months and 2 weeks from the day President Roose- velt signed the Industrial Control Act, 182 codes have been cre- ated, covering the major part of the Important industries. Him- dreds of more codes are still to be prepared, but N11.A. estimate the industries affected by them employ only 4 to 6 million workers, and that the bulk of the ogganlglng Job could be completed by the end of January. Yesterday marked the end of the original President's Reemploy- ment Agreement, imder which more than 3.000.000 employers won the right to display the blue-eagle emblem. But the eagle will continue to fly. Only a small portion of employers originally under the voluntary agreement remain to be coveml by manda- tory codes. Anyone for whom a code is not in force can take down the eagle and go back to unregulated wages and hours until the code for his industry or trade has been approved. all XHTrnm vtaoM. saclb President Roosevelt, confident public opinion will condemn backsliders, has invited all to continue the vcdtintary agreement until May. From now on. anyone who displays the esigle is prom- ising to abide either by hid code ductlon, electricity production, department -store sales well Im- P'oved In the 12 months. Bank debits, gasoline sales, and life-insurance sales have gained receded, but show net improvements over last January. (Prom the Wasbint^n News, Dec. 91. 1933] NJIA. AlfO ROOSKVCLT PBAISKO BT HKAO OF MANtTFACTUBZNC BODT ROBBBT L. LdWD TBLLS NATIONAL ASSOCUTION Of MANtnTACrCBBBS iNOinSTBT Is ViNDICATKD Phqjuwlphza. — The president of the National Association of Manufacturers analyzed the President's N.R^. program here today and found It good Robert L. Lund, a member of the NH-A. Industrial Advisory Board and head of one of the moot powerf til business organiza- tions m the country, approved every act of the administration In Its attempt to end the depression. • • • " framing the National Industrial Recovery Act the national administration and Congress bave vindicated the policies and philosophy of American iudustr.f ". Lund said In an address before the Philadelphia Chamber of Cccomerce. " The philosophy of the act is to release business and Indiistry from the shackles of the antitrust laws, which for 50 years have made it Impossible for buslnesii management to set Its house in order ", he said. Lund pointed to higher prices In agriculture and Industry; to In- creased employment, and higher wages as being attributable to Mr. Roosevelt's program. These developments compare more than favorably with statistics of othei* nations, he said. [From the New York Herald THbune, Dec. 33. 1933] RoosrvcLT Mail 10 Tucks Ami Prkdecessor's — 25,000 Chkistmas LeTTCBS and BlTNItLXS DSSCKND ON WRITS HOOBB IM NbW RXCORO Washington. December 22. — The White House timlght was all but burled tUkder an avalaiu^hc of Christmas mall and presents, the gifts of a Nation passing Its first yuletlde under the new deal. More than 25.000 letters and bundles descended today on the historic mansion, a volume 10 times greater than that enjoyed by even the most popular of prevloiis administrations. To friends of the Roosevelts this recognition was looked upon as an amazing example of Mr. Roosevelt's grip upon the popiilar imagination and proof that the country la with him solidly after nearly a year of drastic measxuts calctilated to Uft the depnaalon. [From the Washlngtcn Herald. Jan. 1. 1934] OovBUtoBS or Statcs PioM CotftBT TO CoAST RspoBT Dccnffio Up- TxrmN — Indiana Vixws 1933 AcTivrrt as Bsncticial — Habmont IN RXSTOBATION OT SOCIAL ANQ KCONOMIC ObDBB CoiUUENnBD BT GovxBNOB McNurr By Gov. Paol V. McNutt Inoianapolis. Ins.. December 11. — The new year 1934 ushers in an epoch of regained equilibrium for the American people, as we view It with confidence from Indiana. Federal and State Oovemmects of our RepuUlc never before have worked in such perfected luumony for relief of human dis- tress and for the restoration of social and economic order. A new sun floods the horiaon. CtmtlnuotM unity of achteTement Will bring the full warm BtuuhlZie of 1934. WOBST Xtr MABCa Oreatesft dlstreaa oMalned in in^i^n*. iq March of 1983 vhaa It was estimated that 104.000 families were driven to aeak puhUc aid January 8 luoNOis Pat Rolls Incbkasx $7,000,000 Ovzb Last Teab By Gov. Henry Horner, of Illinois SPKiNcnxLo. III.. December 31. — Ullnois has experienced a nAarked improvement In general business conditions since January ij 1933. Employment from January 1 to October 1, when the last accu- rite figures are available, increased 25.9 percent, while pay rolls increased 32.6 percent. Information indicates approximately 600,000 persons have ob- t4ined employment since January 1. A majority of these persons, u p to the first of 1933. had been receiving assistance from the I linois Emergency Relief Commission, through Its cooperating a ^encles. The number of employed being put to work Is being increased daily by the efforts of the C.W.A. State deptartment of labor estimates are that pay rolls In the State now are $7,000,000 a week greater than In last January. The relief situation was the least serious for months in Sep- tember. The number of resident families receiving aid was only 0.23Q as compared with 322.000 at the March peak. The relief Idad rose slightly in (Dctober and figiu-es probably will show that it r4se again in November. A suggestion for coping with such emergencies in the future is t^: The several States, cooperating with the Federal Government, should give consideration to the extension of the public-works CI instruction program to care for peak periods of unemployment 14 the future. Michigan Lists Pat-Roll Gains By Gov. Wm. A. Comstock, of Michigan Lansing, Mich., December 31. — There were 93,992 more Jobs In l^lchlgan factories in October 1938 than in January 1933. The approximate weekly pay rolls In Michigan manufacturing liidustrles for the month of October 1933 were $10,331,410, Decem- ber 1932 the pay rolls were $7,637,530. Thus, there was a gain ii. the pay rolls of $2,693,580, or 35.2 percent. Statistics collected and compiled by the Michigan Department Labor and Industry are limited to the survey of employment ih. manufacturing industries. Nonmantifacturing industries and the wholesale and retail trade are not covered by this survey. In view of the increased employment and the pay-roll pain, one Tf^ould draw the conclusion that economic conditions In this State qad Improved considerably since January 1. UPTtntN Fklt in Missoxmi By Gov. Guy B. Park, of Missouri JsmaaoN Crrr. Mo.. December 31. — Economic conditions In l^lsBouri have Improved since the beginning of 1933. Approximately 20.000 of the State's unemployed have returned ti> York during the past 12 months. No statistics are available tp disclose the extent of the pay-roll increases. Relief agencies have been established In every county, and In cbnnectlon with the Civil Works Administration, are doing every- thing possible to supiriy relief and work. Economic conditions may cause a habitual mental state. Re- alization of this would be a big factor in improving matters. iUt Roll Gain in Bat Statb dm bt Elt — Economic Condition or MAaaACHuazTTs Shows CoNsmsBABLS iMPsovxiiiENT in Yeab By Gov. Joseph B. Ely. of Massachusetts Boston. Mass.. December 31. — The economic condition in Massa- chusetts has Improved to quite an extent since January 1 last. This is evidenced by an increase In employment In manufactur- liig In November as compared with January of approximately 25 f eroent aixl an accompanying increaae In the amount paid In of approximately 40 percant. 1934 CONGRESSIONAL RECORD— SENATE 215 EMPLOTZO INCBEA8B In the wholesale and retail trade the number employed increased approximately 12 percent and pay-roll payments 9 percent. For all classes of employment combined there has been a gen- eral increase In employment of about 15 percent and an Increase In pay rolls of about 18 percent. The department of labor and Industries estimated that the number of unemployed in Massachusetts as of January 1 was approximately 521,000. and of this number approximately 105.000 are now employed in private industry, reducing the estimate to 416,000 as of November 15. The number securing employment through governmental projects Is not exactly known, but they should be deducted from the 416,000. Massachusetts cities and towns and the State government have until this year shouldered the entire burden of the welfare expsndltures, which have risen from above $9,000,000 in 1929 to $40,000,000 this year. KELIE7 INCREASED The number of persons assLsted has Increased from 150.000 In 1929 to over 500.000 In 1933. This year the State Is to receive In the vicinity of SIO.OOO.OOO from Federal relief. Prom April 1 until September 1 welfare lists dropped from 40 to 50 percent in most of the industrial cities and towns, and the average decrease for the entire State was approximately 40 percent. Blnce Septemoer there has been a considerable increase in relief. In Massachusetts we are doing everything in our jxjwer to fur- ther the policy of the President, and we are succeeding far beyond oui expectations. SwiTT & Co. Sales Exceed $500,000,000 Chicago. December 30. — With an Increase in tonnage of about 0 percent. Swift & Co. showed annual sales amounting to a little over $500,000,000. according to the annual statement of the com- pany released today. In his report to shareholders. G. F. Swift, president of Swift & Co.. said: " Some of our products made profits due to rising inventory prices. Properly speaking, such profits are capital gains, rather than merchandising profits, and should be preserved to offset future inventory losses. We have therefore set up a reserve of $4,267,000 on our balanca sheet against possible future losses due to declining inventory prices." Mr. Swift's report discloses that there was an increase of 435,- 000,000 pounds of meat production during the year and that there was an increase of 343,000.000 pounds during tlie last 3 months of the year. As a result of this tremendous increase in the meat supply during August. September, and October and the low pur- chasing power of the Nation, wholesale and retail meat prices closed the year at low levels. (Prom the New York Herald Tribune, Nov. 1923] Hebx's Looking at New Deal To the New York Herald Tribune: 1 get sick of hearing and reading perpetual destructive criticism of the administration, of Roosevelt, and of his men. Business is getting worse; the N.R.A. Is killing business; Johnson Is running wild; dead cats; Roosevelt is advised by long-haired professors; we should never have gone off the gold standard. God knows where the dollar will go now. Flight of capital. From downtown: " V/e are doing a very active business. We are ship- ping wealth abroad." Socialism: "We elected a Democrat and now we've got a Socialist." What has become of the Constitution? The stock exchange will be legislated out of existence. We are afflicted daily with this sort of rot, even occasionally from the revised pages of this sincere — if every once in a while a trifle misguided — newspaper. All right. Business is getting worse. Business, according to the Herald Tribune index, went up from 43 to 76 and is back at 59. (Other index compilations show less recession.) In other words. It is up 16 points since April. Did anybody in their senses expect business to keep going up at the rate of 10 points a month in the index as it started out? Is Roosevelt supposed to be a magician? He is apparently expected to give us back prosperity all of a sud- den without even turning the corner that Hoover spent three and a half years trying to find. The N.R.A. Is killing business. Certainly it has slowed it up. But was anyone naive enough to think that companies could employ more men and pay them higher wages without reducing profits somewhat? You can't spend the same money twice. The NJI.A. has given employment to 4.000,000 men in 4 months; call that nothing? It has done away with a multitude of abuses In industry. And profits are not over at that. So " Johnnon is running wild." The wonder in my mind Is that he is not wilder. Anyone who has had to contend with the 15,000 divergent Interests he has had to, from captive mines to hot oil, is entitled to be crazy. I think he has done a mighty good Job myself. Talk about Owen Young getting the French to agree about money. That was " duck soup " compared to Johnson's Job. So, I say, give him a big hand and not a " dead cat." So Roosevelt is advised by long-haired professors? And whose advice should he take? Al Wiggins', I suppose? Or. perhaps, Clarence Dillon's? Why should he not be advised by professors? Warren has a very definite theory on the relationship of commod- ity prices to gold. The details, if you care to read them, are in his book. Prices. The theory la not proved yet. But you've got to admit prices are up since we went off ths gold basts. Give his Ideas a chance. They are likely to do as much good as mouthlngs about " rugged Individualism." Now for " where the dollar Is going." Personally I lire and work m this country and expect to contintis eo. So I don't care ths faintest lota where the dollar goes or how many grains of gold there are In It. so long as I have a chance to earn a living and the dollars I earn wUl buy what I want. As I see it, that is Rooeevelfs Idea for the whole country. The filght of capital. Rats leaving the ship— that is not sinking. The worst flight of capital was when we lent all that money to the foreigners. This ia easier to deal with; there wlU be an embargo If It gets too bad. Socialism. Call It anything you want, but men have got tobs put to work. You cannot walk a block In any city without some fellow hitting you up for a dime. That Is not right. The con- dition of which that la the symptom must be remedied, let the chips fall where they may. Rooeevelt realizes that. Socialism. My family have owned property In and aroimd this city for five generations. That tends to conservatism. But for the Govern- ment to provide food and shelter and work tor those without it; if that is socialism. I am for It. As for the Constitution, if these efforts to give people work, to make business fair, to raise prlees to the debt level, violate the ConBtitutlon, Its Just too bad. There are 21 amendments to the Constitution already. Times change. The Constitution was never expected to last forever In its original form. One last thing. The stock exchange. That hlti pretty close to home. I work down there and have for many years. But even I admit that it is not best for the country to let the stock ex- change run wild. Brokers as a class know less about the wares they deal In than a drug clerk does about what is in patent medicines. There should be some regulation. But don't forget that the stock exchange Is a kind of psychological safety valve; and don't forget that the stock exchange was at times the only means of raising liquid capital during the depression. Roosevelt knows that. Roosevelt is no Bolshevik, and no more am I. So here's looking at him in honest liquor on December 5. ClTlZBN. New Yobk. November 11, 1933. (Prom the New York Herald Trlbtme. Dec. 8. 1933] " Help Roosevelt Pmx U.S. Otrr ", Ford Appeals — " 1934 to f» Good Year for Evertbodt Who Works ", He Telxs 46.000 Dealers — New Models Out Today — ^Bosel Fobd Seconds Pbb- diction of Upturn Soon By Bert Pierce DzTRorr, December 7. — " We have got to pitch in and help the President pull the country out of a hole", said Henry Ford in speaking to a Nation-wide audience of dealers today. He talked over a long-distance telephone circuit from the Dearborn offica. More than 9.000 dealers, 17.000 salesmen, and 20,000 other m-mbera of dealer organizations listened to the address. The Canadian ter- ritory was included. Mr. Ford's «tdress follows: " Hello, everybody. " You know I don't make speeches; I make cam. " You are getting a good start on next year with s good car and a good outlook for business. I think 1934 wQl be a very good year for everybody that works. That is one thing the depression has taught us; the only thing that can pull this country through is work. There Is plenty of work to do. We have all got to pitch In and do all the business we can to help the President pull the country out of the hole. " So I wish every Ford salesman and dealer and manager a busy and prosperous year. Thank you." • • • • • • • (From the Washington Star, Dec. 8. 1933] FoRo Asks Dealers to Back PREsmENT — Motor Macnatb 8ats Each Must Do Utmost to Speed Rbcovebt Detroit. December 8- — In his first public utterance since the Fall of 1932, when he spoke In behalf of former President Herbot Hoover, Henry Ford yesterday asked Ford Motor Co. dealers "to pitch In and do all the business we can to help the President pull the country out of the hole." " I think 1934 will be a very good year for everybody that works ', Mr. Ford said In a brief address over an International telephone hook-up from his Dearborn offices. "That is one thing the de- pression has taught us; the only thing that can pull Uila country through Is work. There Is plenty of work to do. We have all got to pitch in and do all the business we can to help the President pull the country out of the hole." These words, coming from the outstanding non-signatory to the NR-A automotive code, the man who last summer told news- paperment that " I have nothing to say about the N JI.A. or any- thing else ", were studied with Interest. Those who heard Mr. Ford's talk yesterday recalled that NJB-A. Administrator Hugh S. Johnson said at Atlanta. Oa., several weeks ago that he was satisfied the Ford Co. was Uving up to the requirements of the code. Ford Co officials have asserted that the concern is complying with the automotive code up to the point of actually signing the agreement and that the company would have to " Uve down to the code, not up to It." 216 CONGRESSIONAL RI ICORD— SEN ATE (Prom the WMhlngtwi Port. Dec. 25. 1»8S] BCb. liCAcmTTDn DoesKT Lnne Pwonx Who CBmcmt To th« torroB of tht Poar-^a: Some men •«™'^*o.^'* arrlveU on thU mundane sphere ahead of their time ttoth potm- caily and ■denUflcally. Por Instance, when OalJleo tot an- nounced the theory that the world waa round Instead at being flat he waa aeverely criticized, persecuted, and made to recant under penalty of death. And. so today, when Pre«*^entROQ8evelt launches out on a course which U dUunetrlcally oppoeed •<> *he 8o-c»ll'^ -policy of rugged indlTldualinaa ". every maa fOr him- self and hl» satanlc majesty take the hlndmoet. he U roundly abused and severely criticized by thOM who believe In the do- nothing policy of watchfiil waiting. President Roosevelt beUeves that It Is the duty of the Oovem- ment and the several States " to help men help tbemsrives ". and not let them starve in a bmd of plenty, and we slnoerely believe that the great majority of the pecq;>le of the United States, regard- less of party, creed, or previous condition, are with the President in his efforts to bring the country oxit at the slough of deqmlr and despondency into which it has been put by the do-nothing policy of the Bepubllcan Party, which has been in continuous control of the Government for the past 12 years, up to 1833. during which time the aforesaid party has " damned, ditched, and drained the country." Now. sotne at tlM members of said party, and a few discredited and disgruntled Democrats, none of whom come forward with any better plan to help save the country from this awfxil depression. are throwing mud at and trying to discredit the actions and efforts of the head of this NaUon — a man who has been working night and day to bring order out of chaos, to help feed the hungry, clothe the naked and destitute. Their acUona. under the circumstances, are Uttle short at trea- son. When we read some at the mud-slinglng effusions of former leading Democrats, we are farced to the conclusion that Judas lacarlot had wn*>»iT>g on them. 8. MAcauiMB. [Prom the Ftew York Herald Trlbime. Jan. 7. 1934] N«w ToBK KxcHAWOJs Stocks' Valttsb vr 660 Mbxioir — Total Put AT $33,094,751,244 ON Januakt 1; Avsaaox Paxoi Riaa to $25 JW The total market value of the 1.209 stock issues on the New York Stock Szchange, as of January 1, had a total market value of $33.094.751.M4. in eomparlson with a maitat value at $32,542.- 45e.452 for the 1,211 lasuee listed as of December 1. 1983. according to an announcement from the exchange yesterday. The average price of all listed stock Increased to $36.58 from the $25.13 Qgure of December 1. The ratio of security loans to market value, as of January 1, was 2.55 percent. This contrasts with 2.43 percent on Decem- ber 1. Stock Kzchange member borrowings on secttflty eoUateral amounted to $346,132,524, as of the beginning of the month. The Stock Exchange taUe, which foUows, shows the listed stocks classified by industrial grot^M. with aggregate market value and average price for each: Stocks Autos aad i Ftnancial. Cbetnicais BniMtnK KlectriaU-sqnipisnt laasakctarcn. Food^ -- Rubber aad tiraa.. Fami niacJiinery... AmuMmetiUi L«ml sad !-eaIty Machinery Ao Retail mw-handitiac - Railways aad equipmuits Bt«»l. iroD. and eoks TcxtUas... Uas aad ekcoic (operatise) Gas and aicctrie (koMim) CoramuniaUions (oaMe. lelegrapb and radio) Mi3(«Jlaneous utitittes. - Aviation - BoiriiMSRaBl flAee fqnipiiMDt RhiiiiunK aa^iosB Bhip opOTStian and buildiag . Misi^lkaeoitf buaiaen ......... ... Leather and boui^ .._.. ... . Toharco-- 74484) Prance: Total public debt, as of August 1933. francs. 502.000.- 0 O.OOO; converted at par of exchange, $19,678,000,000; converted a prevailing rate of exchange. $26,465,000,000 (1 franc = $0.0527). Belgltim: Total public debt as of Setpember 80, 1933, francs, 5" 849,000.000; converted at par of exchange. $1,694,000,000; con- VTted at prevailing rate of exchange, $2,437,000,000 (1 franc - $i).425). Germany: Total pubUc debt as of September 30, 1933. Reichs- nark 13 211,100,000; converted at par of exchange, $3,147,000,000; omverted at prevaUlng rate of exchange. $4,802,000,000 (1 Reichs- 0 lark - $0 .363457 ) . ^ Italy: Total public debt as of Augtist 31, 1933. Ure, 99,468,000,000; omverted at par of exchange. $5,232,000,000; converted at prevaU- Uig rate of exchange, $7,957,000,000 (1 llra-=$0.08) . Japan: Total public debt, as of November 30. 1933, yen. 7.809,- 1 njOOO: converted at par of exchange, $3393,000.000; converted at p-evaUing rate of exchange, $2,395,000,000 (1 yen =$0.30675), Mr. LONO obtained the floor. Mr. ROBINSON of Indiana. Will the Senator from Lou- iiianA yield to me for a moment? The PRESIDINO OFFICER (Mr. Pop« in the chair). Ik)es the Senator from Louisiana yield to the Senator from Indiana? Mr. LONO. I yield. Blr. ROBINSON of Indiana. I want to ask the Senator 1 rom Louisiana to yield to me long enough to read one para- i raph into the Record from the Washington Post of Wednes- 0.000.- 000. and the cost of running the Government that is loaded down with that debt, and not one single finger has been raised in this body since I have been here, under the old administration or under the new administration, to take one dime of the cost of resuscitating the human race ofT the back of the common man himself. President Roosevelt has spoken about this matter lately. It got into only two newspapers. I sent over to the White House for a copy of the speech and they said it was not to be had there. No doubt the few copies they had had already been called for. The President made a speech on October 21 last and it was sent out over the Associated Press wires- I have it here. It was not printed in more than two news- papers in the United States, the Chicago Daily News and the American Progress. Mr. LEWIS. Mr. President, may I ask the Senator from Louisiana what is the American Progress? Mr. LONG. It is a patriotic Journal that sprung up from necessity to free the human race in America. [Laughter in the galleries.] ^ ^ Mr. LEWIS. Mr. President, I ask that the occupants of the galleries be informed that it is against the rules of the Senate to make any demon8trati pay it by correcting this very damnable condition thai brought on the depression and keeps it on today. There 1 1 only one thing on God's topside face of earth that keepa this condition of depression on in this country today that is because, as is shown by the bank deposits alone tenth oi 1 percent of the bank depositors have more m<«e in the national banks than all the other 99 9/10 percent o ' January 8 keepa r, ani e, on^ n<«ej the bank depositors put together, to say nothing of the fact that millions and millions of the people have not any bank accounts at all. There Is not any way to correct the condition except through scattering the fruits and the wealth of the land, and yet we continue to pile up and to pile up and to pile up the debt. I agree with the Senator from Arkansas: we ought to authorize the work that has been done, however faulty some of it may be, as the Senator so nobly admits and as I admit. We ought to continue to authorize everything necessary to feed the hungry and to clothe the naked. We are not feeding them all. We are not clothing them all. Where there is one man on the dole roll today there are two men trying to get on the dole roll today; and we are going to be faced with the proposition not of just continuing this dole roll until springtime comes but of continuing the dole when spring is here, and when summer is here, and when the fall comes. I call that a dole roll. Mr. President, for $12 a week is not anjrthing. Fifty dollars a month is nothing. That is not house rent, in normal times, for half the people of this country. Fifty dollars a month will not pay for the light and the water and the house rent, let alone the food and the clothes that people ought to have in anything like a respectable home. But if we are going to continue the dole roll, we are going to have to take care of all the rest of the people who are trying to get on the dole rolL We are not keeping it entirely complete by a whole lot in my country, because many and many of my friends are trying to get on the dole roll who cannot get on it today. I am not saying that they are kept off because they are my friends; but that fact did not help them get on the dole roll. [Laughter.] I am not condemning that. If some- body else will feed the anti-Long men, I will help feed the Long men down there as long as I can. I am not con- demning that. That helps us all; but I happen to know from bitter experiences that thousands and thousands and thousands of men are trying to get on the dole roll today, and it is not fair for one set of politicians — and I use the word advisedly — to get their friends on the dole roll and not permit somebody else to get theirs on it. We cannot keep the dcrfe roll going by keeping part of them on and keeping part of them of[. We are going to have to open up the dole roll and put all the rest of them on, and then, finally, be weighted down to the proposition that the bonds must in- crease, as the President says they must increase, and the debt must increase, and you caU that a distribution of wealth! You call that a transfusion of wealth! You call that a diffusion of wealth! You cannot take one sick man who is dying and take blood out of his veins and transfuse it into the veins of another man who is dying and make the other man well. You can- not take from the weak and give strength to the weak. You cannot take from the impoverished to give food to the starv- ing. You cannot take from the naked to give clothes to the naked. But if you continue to pile up this debt and pile up this debt and pile up this debt, and not in its incipiency or at some reasonable stage of this matter provide a way to pay it, how, then, is it going to be paid except by the taxes loaded and carried right on down to the man standing on the bottom, where the taxes of this coimtry are today? My resolution proposes that a man can have but $50,- 000.000; that he can inherit but $5,000,000; that he can earn but $1,000,000 per year — all over those amounts to be paid to the United States. It would hurt no one. It would give everybody that has a fortune more than he can ever use for his hving or for the Uvlng of his children. And it would give the United States $15,000,000,000 per year to do every- thing the Government is doing or needs to do. It proposes: ETery man a king. Mr. President. I wonder if my friend from Illinois [Mr. Lewis] has read the American Progress. If he has not read It, I do not suppose he needs to read it, because he is one ol the few men in tlie Senate who has read everything the American Progress could print anyway that is fit to read. 1934 CONGRESSIONAL RECORD—SENATE 219 But here is something from the old Greek philosopher, Plato, cited as the wisest of all the world's philosophers. I read a few lines from Plato. Said Plato: In a state which Is desirous of being saved from the greatest of all plagues — not faction, but distraction — there should exist among the citizens neither extreme poverty nor, again, excessive wealth, for both are productive of both these evils. In other words, excessive wealth produces excessive pov- erty, and excessive poverty produces excessive wealth. Both are productive of these evils. Now the legislator should determine what Is to be the limit of poverty or wealth. Let the limit of poverty be the value of the lot. This ought to be preserved and no ruler, nor anyone else w^ho aspires after a reputation for virtue, will allow the lot to be impaired In any case. This the legislator gives as measure, and he will permit a msm to acquire double or triple, or as much as four times the amount of this. But If a person have yet greater riches, whether he has found them or they have I been given him or he has made them in business, or acquired | by any stroke of fortune that which is in excess of the measure, 11 he gives them back to the state, and to the gods who are the patrons of the state, he shall suffer no penalty or loss of reputation. But if he disobeys this, our law. anyone who likes may inform against him and receive half the value of the excess; and the delinquent shall pay a sum equal to the excess out of his own property, and the other half of the excess shall belong to the gods. So, Mr. President, there is nothing new under the sun. Mr. LEWIS. Mr. President, will the Senator yield? The PRESIDING OFFICER. Does the Senator from Louisiana yield to the Senator from Illinois? Mr. LONG. I yield to the Senator from Illinois. Mr. LEWIS. I wish to say to the able Senator, while I thank him for his reference to what he has been kind enough to refer to as a compendium of small information I possess, that it may interest him to know that apart from the quota- tion which he has read, which comes from the Republic of Plato, he will find the same philosophy, almost the same expression, in the Holy Scripture, in the philosophy of Agar, fortifying his viewpoint. Mr. LONG. Yes; I thank the Senator. It is in the Holy Scripture, as the Senator from Illinois says, practically in the same words, or at least to the same effect. It will be found in the speech of Daniel Webster that he made at Plymouth, practically in the same words. It wiU be found in the words of Abraham Lincoln. It will be found in the words of Lord Bacon. It will be found in the words of Theodore Roosevelt. It will be found in the words of Wil- liam Jennings Bryan; and I have already read it to you in the words of Franklin D. Roosevelt. The time is here. Why sit we here idle, and let this public debt and this burden of government pile up on the Uttle man who is having to pay it? You say, " I am going to relicA'e you of the load." You are giving him a biscuit to eat, and you put a barrel of flour more taxes on top of his head to carry. How are you relieving anybody here in this country? You come along and you dole out to him 12 little 2-by-4 dollars in a week, and you say, " Now, go along with that; and, oh boy, just to be sure you do go along. I want to tell you that there is 10 billion more in taxes and Interest to pay for the next 50 years of your life in order for you to get enough money to pay for your washing for the last week." Why do we sit here, Mr, President? The first thing I did when I came to the United States Senate, ignorant as I was of the proceedings, unschooled as I was in the manner of legislation, was to introduce in the Senate a resolution to provide that there should be a limit to the amount which a man should own, and that the wealth of this country should be brought back into the Treasury and diffused among the 120 or 130 millions of people by relieving them of taxes, paying it out in public works and other benefits that the Government could very handsomely bestow. That proposal is made In a resolution now lying on the desk that I intend to call up right away, within the next few days, Mr. President. Not only do I propose to relieve the people of the taxes that they are already paying, but I attach to the resolution which now lies on the desk of the Senate % proposal that we shall have an old-ace pension In the United Stetes. in keeping with the Democratic Party's last pronouncement. In the Chicago convention the Democratic Party went on record for an old-age pension to be paid by the States. The States cannot pay it. The States hikve not enough money to pay it. The only way in which the Democratic Party's platform can be carried out is for the United States Government to collect the money from the swollen fortunes and to remit it to the States to be paid out. So. In order to keep the faith of the party, in order to carry out the platform that I helped to adopt as a delegate and as a national committee- man to the Chicago convention, I propose that we shall collect into the Treasury of the United States through limit- ing the fortunes of the big men, through limiting the in- heritances of the rich young men, through limiting the amount that one man can make in a year, a sum that I estimate on good authority at $15,000,000,000 per year; and I propose that we shall take from that siun enough money to give every man who is 60 years old and every woman who is 60 years old $30 a month unless they have a net Income that exceeds $1,000 a year or property that Is of a value of $10,000. I propose that we carry that out; that we carry out the faith of the party; that we correct this trouble that has brought America to the brink of disaster; that we pro- vide a means of keeping the Treasury solvent; and that we provide a way of bringing down the powerful to a point where they are not so powerful that any man cannot thrive in competition with them. I propose that all these wreck- ages be brushed away by harming no one. but by making such a thing in America as a limit to the accumulations of one man, as a limit to the fortune of one man, thereby Im- posing a limit to the starvation and poverty that we will impose upon the masses. Mr. President, I ask leave to have printed in the ReconD. at the conclusion of my remarks, a brief extract from the speech of President Roosevelt at Chestertown. Md., on Oc- tober 21, 1933. There being no objection, the matter referred to was ordered to be printed in the Record, as follows: [From the speech of President Roosevelt] As I recall the words of a professor in my school, the wider a distribution of wesdth there is in the proper way the more we can make it possible for the men and women of the land to have the necessities of life in such shape that they will not have to lie awake at night worrying where the food for tomorrow will come from. Then, and only then, will we have the security necessary for the country. CALL OF THE BOLL Mr. THOMAS of Oklahoma. I suggest the absence of a quorum. The PRESIDING OFFICER. The clerk will call the roll. The legislative clerk called the roll, and the following Senators answered to their names: Adams Ashurst Austin Bachman Bailey Bankhead Barbour Barkley Black Bone Brown Bulkley Bulow Byrd Byrnes Capper Caraway Carey Clark Connally Coolldge Copeland Costlgan Couzens Keyes Robinson. Ark. Cutting King Robinson. Ind. Davis La pyjllette RusaeU Dickinson Lewis BchaU DiU Logan Sheppard Duffy Lonergan Shlpstead Brlckson Long Hmlth Fees McAdoo Stelwer Fletcher McCarran Stephens Frazier McOUl Thomas, CNcla. George McKeUar Thomas. Utah Glass McNary lliompaon Ooldsborough Murphy Townsend Gore Neely T'ranun^ Hale Norris Tydlnga Harrison Nye Vandenberg Hastings O'Mahoney Van N uyt Hatch Overton Wagner Hatfield Patterson Waloott Hayden Plttman Walsh Hebert Pope Wheeler Johnson Reed White Kean Reynolds The VICE PRESIDENT, answered to their names, a Ninety-one Senators hftTlng quorum is present. 220 CONGRESSIONAL RECORD— SENATE January 8 PKOHXBXnOH or TXANSACnOaS WITH DCFAULTOIC Mr. JOHNSON. Mr. President, is it the intentioa of th^ Senator from Arlcansas that the Senate shaU proceed wit^ the calendar this afternoon? Mr. ROBINSON oT Arkansas. It is not. Mr. JOHNSON. Then, if the Senator will p«Tnit me, tb : first biU upon the calendar (S. 682) , which has been pendin ; for some time, is designed to prevent the sale in this oountr r of securities of countries wtoch are in default. It is a bil which I intend to press at the earliest possible moment. Ajt this time I ask permission to have the bill reprinted, wi two very brief amendments, in the measure, so that amendments may be befort; the Senate when the bill reached for cons^ration. The VICE PRESIDENT. Is there objection? The bears none, and it is ao ordered. TAXATIOir or ALCOHOLIC LIQTTOIIS KKTOKT Mr. HARRISON, from the Committee on Finance, to whic ti was referred the bill (HJl. «131) to nUse revenue by taxing certain intoxicating liquors, and for other purpoGes. rq?ort€ d ft with amendments and submitted a report (no. 14SP thereon. XXECTTTCVS SESSION Mr. ROBINSON of Arkansas, I move that the Senate proceed to the consideration of executive business. 1 The motion was agreed to: and the Senate proceeded ^ the consideraticm of executive business. XXKCXTTrVE KKSSACES SCTERVXO The VICE PRESIDENT laid before the Senate sundry m sages froBQ the Presidoit of the United States Butoiltt nominations, wliich weie referred to the apixopriate mittees. (For nominations this day received, see the end at Senate proceedin4{s.) REPORTS OF COMJdTTEES Mr. KINO, from the Committee on the District of Ccdun i- bia. reported favorably the nominations at George E. Alkn and Mcli-in C. Hazen. both of the District ot Columbia, ^o be Commissioners of the District of Columbia for terms 3 years each. He also, from the Committee en Finance, reported favo: ably the following nominations: Margaret M. McQuilkin. of Salt Lake City. Utah, to collector of customs for customs collection district no. m, with headquarters at Salt Lake City. Utah, in place >f Jennie P. Musscr, resigned; and Hugh T. Rippeto. of Salt Lake City. Utah, to be assayer n charge of the mint of the United States at l-Iew Oiieans, Li i., to fill an existing vacancy. Mr. HARRISON, from the Committee on Finance, report) ^d favorably the nomination of James J. Hoey, of New York. N.Y., to be collector of mtenial revenue for the second dis- trict of New York, in place of William Duggan, resigned. Mr. WALSH, from the Committee on Finance, report td favorably the following nominations: Peter M. Qagne. of Somersworth, N.H., to be collector )f internal revenue for the district of New Hampshire, m pla :e of John H. Field, resigned. Clinttm A. Clauson. of Maine, to be collector of intern elI revenue for the district of Maine, la place of Frank J. Hai a, resigned; John H. Dooley, of Portland. Maine, to be collector if customs for customs coIlecUon district no. 1. with head- quarters at Portland. Maine, in place of fYank M. Hume: Samuel T. Ladd. of Portsmouth, N.H.. to be comptroUsr of customs in customs c 224 CONGRESSIONAL RECORD— SENATE To be captains First Lt. Edward James Roxbury. Pield ArUUery. from January 1. 1934. First Lt. Donald Dakin Lamson, Coast Artillery Cori«. from January 1. 1934. First Lt. Augxistus Dawson Sanders. Infantry, from Jaa- uary 1. 1934. First Lt. Harvey Thomas Morgan, Infantry, irom Jaa- uary 1. 1934. ^ ^ , First U. Elsmere Joe Walters. Quartermaster Ckjrps, in m January 1. 1934. First Lt. Harry Edgar Hagan, Quartermaster Corps, rnm January 1, 1934. First Lt. Frank Osbom Dewey. Cavalry, from January 1, 1934. First Lt. Edward Bflilan Taylor, Field Artillery, from Jan- uary 1. 1934. First Lt. Jesmond Dene Balmer. Reld Artillery, fmm January 1. 1934. First Lt. Dayton Dudley Watson, Air Corps, from Jan- uary 1. 1934. First Lt. Herschel David Baker. Field Artillery, fr(im January 1, 1934. First Lt. Herbert Edward Baker, Field Artillery, from January 1. 1934. First Lt. Donald David FltageraW. Air CorpB. from Jsn- uary 1. 1934. First Lt- Tliomas Standifer Gunby, Reld ArtiUery, fnon January 1. 1934. To be flrMt UeutenantM Seoood Lt. Rudolph Ethelbert Smyser, Jr., Corps of En ri- neers, from January 1, 1934. Second Lt. Charles Daniel Curran, Corps of Engine* rs, from January 1, 1934. Second U. Francis Howard Falkner, Corps of Engineers, from January 1. 1934. Second Lt. Alan Johnstone If cCutchen. Corps of Englnei rs. from January 1. 1934. Second U. David William Helman. Corps of Engineers, from January 1. 1934. Second Lt. Robert John Fleming. Jr.. Corps of Englne^s, firom January 1. 1934.. Second U. Davtd Peter Laubach. Air Corps, from Jim uary 1. 1934. Second Lt. Benjamin Smith Shute, Corps of Engine^. from January 1. 1934. Second U. WiUlam Everett Potter. Corps of Engine srs. from January 1. 1934. Second Lt. Edmund Koehler Daley. Corps of Engine nrs. from January 1, 1934. Second Lt. WUliam Joseph Matteson. Corps of Engineers, from January 1. 1934. Second Lt. Webster Anderson. Infantry, from Januar]| 1. 1934. Second Lt. James Elbert Briggs. Air Corps, from J)ui- uary 1. 1934. Second U. Harry Cromartie Kirby, Infantry, from J^ oary 1. 1934. . Second Lt. John Stewart Mills. Air Corps, from January 1. 1934. KEOICAL CORPS To be captain First Lt. Paul Herbert Martin, Medical Corps, from Jan- uary 1, 1934. Afpointmints akd Promotions in the Navy The following -named captains to be rear admirals in the Navy from the 1st day of July 1933: Samuel W. Bryant Sinclair Gannon Capt. John D. W-ainwright to be a rear admiral in the Navy from the 1st day of September 1933. Tbe following-named captains to be rear admirals in {the Navy fKHn the 1st day of October 1933: Charles S. Freeman Charles Russell Train January 8 admiral in the Navy Capt. Ernest J. King to be a rear from the 1st day of November 1933. The following-named captains to be rear admirals in the Navy from the 13th day oi November 1933: Paul B. Dungan, an additional number in grade Hajme Ellis ^ tw Commander Richard S. Edwards to be a captain m the Navy from the 21st day of May 1933. The following-named commanders to be captains in the Navy from the 30th day of June 1933: Clyde R. Robinson Philip H. Hammond, an Irving H. Mayfield additional number in grade John H. Hoover Claud A. Jones, an addi- Allan S. Parquhar tional number in grade The following-named commanders to be captains in the Navy from the 1st day of July 1933: Albert C. Read, an additional number in grade Willis W. Bradley. Jr. Lucien F. Kimball Commander Harold M. Bemis to be a captain in the Navy fiXMn the 1st day of August 1933. Commander Ernest D. McWhorter to be a captain in the Navy from the 1st day ot September 1933. The following -named commanders to be captains in the Navy from the 1st day of October 1933: Carl T. Osbum William S. Farber The following-named commanders to be captains in the Navy from the 1st day of November 1933: George M. Ravenscroft Harry J. Abbett The following-named lieutenant commanders to be com- manders in the Navy from the 5th day of April 1933: Stephan B. Robinson William O. Greenman Lt. Comdr. James A. Crutchfield to be a commander in the Navy from the 21st day of May 1933. The following-named lieutenant commanders to be com- manders in the Navy from the 30th day of June 1933: Charles P. Mason De Witt C. Ramsey John J. Brown Roecoe E. Schuirman Campbell D. Edgar Ingram 'C. Sowell Walter S. Haas Francis E. M. Whiting The feclal tcancmnUt adviser to tbe Bank at Bng- land— why was he sent for? To be tbs liaison oOoer between WaU Street and 230 CONGRESSIONAL II He must ««. eye to rye. with England's bankers here. His TalaA must have been attuned to the Morgan view, otherwise he never would have sailed across the ocean. So we find Professor Sprague In 1930 in the Innermost councils of the Bank of England. We find him conniving with his new colleague, sometimes known as " Professor Skinner ", other times known by his right name of Montagu Norman. Yet we find that during Professor Sprague s tenure of ofBce as economic adviser to the Bank of England that country decides, or U forced, to abandon the gold standard. That step was taken for the good of England. This was September 1931. Professor Sprague didn't then desert the Bank of England becaxise of the gold abandonment. H« stayed on his Job aU through 1932. ^ ^ ...^ He observed that the Bank of England proceeded with a golc manipulation which la duplicated in the poUcy President Roose velt now is conducting for the United States. The Bank of England manipulated the price of gold so thai the pound, the money of England, was forced down to a sub stantlal discount from gold. This was deliberate policy on th( part of the Bank of England. , _ *^ ProfeMor Sprague issued nary a squeak of protest against th< Bank of England program to lift the price of gold. The British succeeded in stemming the downward swing their prices. Their commodity prices stopped dropping as sooi, as England abandoned gold — or, rather, as soon as England manlp ulated the price of gold upward, as soon as the pound's goU. value began to shrink. Meanwhile, the American prices continued their slxmip It was not until we abandoned the fixed gold standard aftc President Roosevelt's election that our prices started to rise But is Professor Sprague satisfied with the American program He is not. He would have put a halt to the whole procedure in the earl; ' •ummer. during the International Economic Conference at LondoE He would have stabilized the dollar to the English pound in i ratio then prevailing, about 3»4 to 1. This was a distinctly pro English act by an American who had been appointed special economic adviser to the American Treasury. President Rooaevelt wisely escaped the nooee which would havs tightened around the United States if he had accepted the recom mendatlons of the professor who had been impregnated ~'" England's needs. Prom that time on President Roosevelt Ignored Professo^ Sprague. Now the professor is peeved. Insulted, disappointed over program which, in his vision, means ruin, destruction, obllvio^ for the American economy. He Is the spearhead at the moment of the whole drive of lwip>r*"e community to destroy the President's program. The real driving forces of this attack dare not show themselves They have been hopelessly discredited by events over the few years and by the thorough dishonesty of their methods exposed by the Senate. 8U11 they persist in claiming Intelligence sufficient to bring out of the depression The President has wisely determined to follow out his own mone|- tary program, that of manipulating the pricfe of gold until com- modity prices arc in agreement with the vast burden of deblj; until the 1936 honest dollar is restored. Mr. LUCE. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. Yes. Mr. LUCE. Will the gentleman give us the name of author of that statement? Mr. GOLDSBOROUGH. His name is Julius Behrens. Mr. LUCE. Will the gentleman state something aboi^ his qualifications as a monetary expert? Mr. GOLDSBOROUGH. Whatever his qualifications be. I want to say that I am in absolute accord with he said. Mr. McFADDEN. Mr. Speaker, will the gentleman yleldj? Mr. GOLOSBOROUOH. Tes. Mr. McFADDEN. I call the attention of the gentleman 1|o the fact that Professor ^irague was the economic and flnar - dal adviser of the goiremor of the Federal Reserve bank 1 1 New YotiE. which had its influence on the policy of tine Federal Reserve from 1914 up until the time he went tjo England representing the Bank of England. Mr. GOLDSBOROUGH. Professor Sprague was connected with the New York Federal Reserve Bank at the time loaned England $300,000,000. was he not? Mr. McFADDEN. He was. Mr. GOLDSBOROUGH. It is worth while at this time 1o call attention to the fact that in nineteen — what year W9s that loan msule? Mr. McFADDEN. I think it was 1925. It was that peridd iB which the Bank of England went back on a gold basis and the loan was made to assist the Bank of England to e o ba^ on the gold basis. The loan was $300,000,000, $200 th! last as U! thi ma^ whst RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE 231 000.000 from the Federal Reserve and $100,000,000 from J. P. Morgan & Co. Mr. GOLDSBOROUGH. And the loan, as the gentleman from Pennsylvania says, was a $200,000,000 gold credit, set up by the Federal Reserve Bank of New York, which was afterwards distributed through the other banks, and $100,- 000,000 loaned by J. P. Morgan & Co., and the evidence before the Banking and Currency Committee of the House showed that Morgan ii Co. engineered the whole thing and received $1,125,000 as a commission for negotiating it. Mr. LAMNECK. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. Yes. Mr. LAMNECK. I have in my possession a stenographic report of an interview with Mr. Sprague, in which he said that he had more influence than any other man in the world in determining the policies of the Bank of England while he was connected with it. Mr. GOLDSBOROUGH. I am glad to have the gentle- man's contribution. Mr. MARLAND. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. Yes. Mr. MAFILAND. Is it not a fact that at the time Morgan b Co. got that commission for the loan, the Federal Reserve bank received no interest for the money loaned? Mr. GOLDSBOROUGH. I am not sure about the interest. Mr. Speaker, there has been a great deal of attempted criticism of the President's policy based on the theory that basic commodity prices have not risen as rapidly as the dollar has depreciated in terms of gold. The explanation for that is perfectly simple. During the time when there was a general understanding that the Reconstruction Pi- nance Corporation would buy all the gold it was offered, the price of basic commodities did rise in about the same ratio that the value of the dollar depreciated in terms of gold. But it became known that while the Reconstruction Finance Corporation was paying more than the usual price for some gold, it was not buying all the gold offered. It has only been about ZV2 weeks ago since Canada offered $8,000,000 gold to the Reconstruction Finance Corporation at $32. The Reconstruction Finance Corporation had fixed its price at $34 and a frjiction. Canada said. " We can only get $32 for this gold in England and we will have to pay transpor- tation. If you want it we will sell it to you at the same price. Now you are paying $34. Will you buy it from us? " " No; we do not care to buy." The amount of gold purchased has been almost nil, and it has become thoroughly imderstood that the Government is not purchasing all the gold that is offered. This is the reason, and the only reason, why commodity prices have latterly slumped somewhat. But the theory that, as basic conmiodity prices are dealt in internationally, they will respond to the depreciation of the dollar in relation to gold is absolutely sound. Now, of course, this battle of wits back and forth between Great Britain and the United States as to whose export market shall be favored cannot go on indefinitely. That is thoroughly imderstood. There must be an end sometime. Tbere must come a time when foreign exchange will be stabilized. There must come a time when the public of this country will know Just what to expect in regard to the policy of devaluation. I am not in the President's con- fidence. I may have my opinion of what he has in mind, but he has not told me ^rtiat he has in mind. My guess would be that he is endeavoring to go just as far as he can from time to time. His idea probably is that if the general gets too far ahead of the army, certain great factors in the metropolitan press can so discredit his policy as to ultimately ruin the program. Now. what must we do? I said to a group of economists about 10 years ago that it was incredible to have a monetary system where it was impossible for people to get out of debt. At that time I was told that my conclusion was not tenable. Within the last 3 weeks two of the best known economists of the United States who were present at the conversation 11 years ago. came into my office and said that the conclusion which I had reached was irresistible. We have in this coun- try, under normal conditioza, about $55,000,000,000 of all de- | jx>sits in banks. About $50,000,000,000 of that is bank credit I and about $5,000,000,000 is money. Now, let us assume that I the country becomes very prosperous. Business is active. | People are optimistic. Crops are good. Prices are trying to rise, and debts begin to be paid. As soon as you begin to pay your debts you begin to decrease your credit cur- rency, and as soon as you begin to decrease your credit cuirency you produce deflation, and deflation lowers the price level and produces the necessity of creating the debt over again. So that under our system it is absolutely im- possible for prosperity to reach the point where we can get out of any sort of debt, and we must find a remedy for it. One of the remedies proposed is, first, the devaluation of the gold content of the dollar, which will create a rise in prices of the same character as would be caused by the discovei-y and extraction of a great quantity of mined gold, and afterward a stabilization of the price level on the 1926 basis, on the theory that that basis is the border basis, the basis that is fairest between creditor and debtor; and then a compensated dollar to stabilize the price level and, in addi- tion, to make it theoretically possible for the country to get out of debt, because under that condition, when prosperity comes and the debts of the coimtry begin to be paid and the prive levels tend to fall, immediately compensation takes place; actual money is issued where credit money was before used, so that it is theoretically possible for all the debts of the country to be paid and actual money to be in existence in place of the credit money which was in former use. The bankers thoroughly understand this, and they have made up their minds to make it impossible, as they have done in the past, for the American people to get out of debt at any time by having actual money instead of credit money. Mr. MAY. Will the gentleman yield? Mr. GOLDSBOROUGH. I will be glad to yield to the gentleman. Mr. MAY. If the g«itleman feels as I do about the pre- vious activities of the Federal Reserve System, there is little, if any, hope of devaluation of our currency or reduction in value by the Federal Reserve System. Why not come to that which we are going to come to in the end now by a remone- tization of silver on an equal basis with gold? Mr. GOLEKSBOROUGH. I may say to the gentleman, whose opinion I regard very highly, that, of course, what the country should have Is a money supply sufficiently ade- quate to prevent Its control by any one class, so that no class can be in a position to knock down the price level and so absorb the production of the country, to be afterward sold at a higher price. And if this magic of a metallic stand- ard, if this superstition must be safeguarded at this stage of civilization, then, as far as I can see, it can be sustained as well on a bimetallic base as on a base of one metal. I am not one of those who has any prejudice whatever against silver behig used as a basis for the issuance of currency, but Just as I would be afraid of issuing greenbacks without any sort of a metallic base, I think, in view of the fact that silver can be produced at a tremendous rate, probably we ought to use some caution in order to avoid an unhealthy Inflation. I was about to suggest before the gentleman interrupted me, that it would be a perfectly wholesome thing to do for the Government to purchase at least a billion and a half dollars of silver at 75 cents an ounce and use that as the basis of an issue of a billion and a half dollars. Just whether I would be willing to start right off on a Inmetallic basis at a given ratio of, say, 16 to 1, I am not prepared to say. But if I were not, It would only be for the reason that we are looking for social justice, and something might happen which would not be fair to the creditor class. Mr. MAY. Will the genUeman yield further? Mr. GOLDSBOROUGH. Certainly. Mr. MAY. In view of the fact that we have in this coun- try ann-oximately $4,000,000,000 in gold as the basis for our present currency, does the gentleman not think that the propaganda we hear about Germany's ctrilapse by print- ing-press money is not apphcaUe to our present condition. due to the fact that Germany, at the time she did that, was overwhelmed witii thirty blUkm or move dollars indebted^ ness that had been thrust upon her and had no gold? Mr. GOLDSBOROUGH. I will say to the gentleman that there are 34 countries off the gold standard now, using all sorts of monetary devices, and there is not the slightest danger of any runaway inflation in any one of these cotm- tries. I will say to the gentleman that France devaluated 75 percent, cut her franc in four parts, and no undue infla- tion, no unhealthy inflation, was caused. I will say to the gentleman that what happened in Germany was that that country was overwhelmed with debt — she could not pos- sibly get out — and she deliberately inflated in order to de- stroy the internal debt. Her action was taken deliberately and in cold blood. Mr. MAY. It was simply repudiation. Mr. GOLDSBOROUGH. And I will say further to the gentleman there are only two other instances — other than the German situation previously diactissed — ^whi^ are cited to us by those who talk about this tjrpe of inflation. One Is continental money, money issued by the States before the Constitution of the United States was adopted; and the other the French assignats. which were issued between 1790 and 1800. at a time when France for hundreds of years had been robbing her peasantry until they not only had nothing, but they had stunted minds as well as stunted bodies, and were unable to produce. That is what happened in France; and France during the entire time was in a condition of revolution, first one class and then another being taken to the guillotine and beheaded.. These are the only two In- stances cited to us of wild inflation. Mr. LUCE. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. I yield. Mr. LUCE, Mr. Speaker, if the interruptions have dis- tracted the gentleman from his speech, I shall hope very much that he be given additional time; but while tempo- rarily his speech is sidetracked. I would like to recall to him that at the period when he says ha received his first economic instruction, the cash currency of the country per capita was about half what it is today. We have twice as much cash currency per capita in circulation and almost as mvKii as the populists demanded In their campaign. How far does the gentleman from Maryland think the per capita cash circulation of tta country ought to be in- creased? Mr. GOLDSBOROUGH. I will answer the gentleman from Massachusetts in Just a minute. In 1873 silver was demonetized, and President Grant said after he had signed the bill and found out what it was that if he had known what it was he would never have signed It. The bill was discussed in the House and in the Senate, and It is said that outside of just a few Members who were steer- ing the thing through the Members did not understand at all that silver was being demonetized; and I may say to the gentleman from Massachusetts that in 1879 specie payments were resumed. So there were two contractions of the cur- rency within a period of 0 years, and this is what caused the collapse which existed at the time of my first economic recollection, 1892. John G. Carlisle, speaking in the House of Representa- tives on ^bmary 21. 187S, said: I know that the world's stoat at the precious metals Is none too large, and I tsa no reason to apprehend that it wlU ever become so. Mankind will be fortunate. Indeed, if the annual pro- duction of gold and silver coin shall keep pace with the annual Increase of poptilation. comnwroe. and lutfustry. According to my view of the subject, the conqHracy wtiJch ■eems to have been formed here and in Burope to t^mUof by lagWation and other- wise from three sevenths to one half of the metallle money of the world is the most gigantic crtme of this or any other age. The conmunmation of such a sekene wooM vlttmat^y entail more misery vpon the human race than all tbc vara. pestUenee. and famines that ever occiuTed In tto* blatory of the world. The absolute and instantaneous destruction of half the entire movable property of the world, including hotaes. shipe. railroads, and aU other ai^Ilancca for caxfyiBg on conuBcroe. while It wonM be felt more sensibly at tte aaoaacot. wouM not produce anything like the prolonged distress and disorganization of society that must Inevitably rrault from the permanent annlhUation of one hrif of the metaUlc money to the world. With an ample cwzancy, an i&dastrloua aad trt^d peopfts will aprntUky rebuUd 232 CONGRESSIONAL their works of Internal improvement and repair lones of property, but no amount of Industry or economy on the part of the people can create money. When the Government creates It or authorizes It the citizen may acquire It. but tie can do nothing more. And unless you have an adequate supply of money, pro- duction can increase to a certain point without a fall in the price level, but when it goes beyond this point immediately the price level falls and industry and production stop, and you have the same infernal misery you have had in this country since 1929. [Applause.] Mr. LUCE. Mr. Speaker, will the gentleman yield further? Mr GOLDSBOROUOH. I yield. Mr. LUCE. Now, will the gentleman be concrete and tell us how much more ca^ currency we ought to have per capita at present, having twice as much as we had 30 years ago? Mr. GOLDSBOROUGH. The gentleman knows that the currency per capita depends altogether on the velocity of circulation. The circulation per capita might be $10 cir- culatmg once a day in which case the per capita for all practical purposes would he $10: or. it might circulate 10 time:^ a day, in which case it would be $100. Your question, as propounded, has. practically speaking, no fixed answer. Mr. PIESINGER. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. I yield. Mr. PIESINGER. The gentleman seems to be concerned about silver inflation. Mr. GOLDSBOROUOH. No; I am not. I tried to be careful about what I said. Mr. PIESINGER. Would the gentleman explain tliis: Suppose we revalue the gold ounce and make it $41.34. and that thereupon gold in the world markets falls to $20.67; will the gentleman tell us wliat would happen as a result of such an operation? Mr. GOLDSBOROUGH. WeU. gold could not do that. Mr. PIESINGER. It has done it. Mr. GOLDSBOROUGH. Gold could not do that because the other countries in order not to lose their gold would have to pay as much for it as we are paying for it. It would make a rise in the price level in thore coimtries in order for them to keep from losing their gold. They would have to pay the price we pay. There would not be one price In one coimtry permanently and another price in another country. While I am entirely sympathetic with the silver point of Tiew. I really am not orepared today to discuss it in detail. ^ In order to illustrate the utter ignorance about the mone- tary situation which is shown by remarkably successful and smart people. I want to call attention to a short quotation from an address delivered by Roger W. Babson on October 11. 1933. at the Century of Progress Pair in Chicago. He is arguing that character and thrift and saving will solve this problem. I shall read an excerpt from page 10 of his address. This is his conclusion: Finally, that through a mving of •25.000.000.000 a year, the total of aU Oovemment, State, municipal, corporation, and private debta could be paid in 8 years, which debta now aggregate $200,000,000.- 000. Hexwe. by a few years of sacrifice, these could be entirely wiped out. together with the present annual Interest charge of over $10,000,000,000. Now. let US suppose this were possible — of course. It could not be done, beouiae the deflation I have attempted to depict would take place. Let us suppose we saved $25,000,000,000 a year and paid off all our debts, and let us suppose that in 8 years aU the debts of the country were paid. This assump- tion, of course. Is baaed (m our present system without any process wtaatevw of compensation in our basic money. Do you know what we would have? We would have no credit currency, becauw all the debts would be wiped out and we would have about $5,000,000,000 with which to transact the business in this country. In other words, we would have chaos and revohitlon. You can save all you please: you can save to the last degree, but If you have iM>t got an adequate supply of money you cannot have anything but a falling price level, misery, and deetmction. This is perfectly evident. Here is Roger a great man. a pubUc servant, a great sUtlsticimi. RECORD— HOUSE January 8 yet he has not the slightest conception of the way our money in this country is managed. Mr. McGUGIN. Mr. Speaker, will the gentleman yield? Mr. GOLDSBOROUGH. I yield. Mr. McGUGIN. Assuming it were within the ijower of the gentleman from Maryland of his own accord to write the monetary program, what would he regard as an ade- quate supply of money, and how would he obtain the ade- quate supply of money about which he speaks? Mr. GOLDSBOROUGH. I will answer my friend from Kansas in this way: I will not go into a theoretical discus- sion of what I would do. I will make the suggestion that it makes very little difference how you word a law if it furnishes buying power to the masses. You may say that you must increase your money supply until labor is em- ployed down to an irreducible minimum of say a million people idle. There are always some walking across the street, or sc»ne who do not want to work, and there may be a million of them, I do not know. This might be the way to handle it; that is, simply increase the money supply until there are none idle except those that want to be idle. Another way might be to attempt to adjust the proper barter relation between the different elements of society in raising your price level and then to stabilize it at a point which would be fair one to the other. You cannot tell in advance how much money will be nec- essary, but you can increase the supply. This can be done in the way mentioned in HJl. 5073, which I introduced and am really discussing today, and which provides for a 50-per- cent devaluation, then a compensating gold content after that point is reached. You can do it in that way. Mr. McGUGIN. I have been in favor of devaluation of the gold dollar at least enough so that our money will be on an equal parity or the usual parity with the money of the world in order that we can carry on commerce with the world. I voted for the gentleman's bill a couple of sessions ago. known as the GoWsborough bill. Mr. GOLDSBOROUGH. I hope the gentleman does not regret it. Mr. McGUGIN. That is the point I wanted to ask about. If the bill had been enacted, or if it were in effect today, does the gentleman seriously believe that the Federal Re- serve could Just start buying in bonds until the 1926 price level would be returned to this country? Mr. GOLDSBOROUGH. I will answer the gentleman from Kaasas in two ways: First, my answer would be that that was the best I could get. It was not what I wanted at all. I could not get action on any other from our com- mittee, and I do not think I could have from the House. But with our abundant reserve at that time we certainly could have raised the price level. Of course when we did that our gold would have been taken away, and when we reached a point where the gold reserve was depleted, we could not raise any more. There is no doubt about that. Mr. McGUGIN. That is what I was thinking about. Mr. GOLDSBOROUGH. What happened is this, and I believe I know the inside of the story: The Federal Reserve System did not want to buy bonds. They did not want to put money into circulation. The Goldsborough bill was favorably reported by the Banking and Currency Committee, and it finally passed the House by an overwhelming vote. Tlie Federal Reserve Board did not know whether they would be able to stem the tide in the Senate or not, so they began to buy bonds, but Just as soon as the Glass substitute killed the legislation they stopped buying bonds. That is what happened in 1932. Mr. McOUOIN. I understand that, but in our present sit- uation, with world commerce broken down. I have reached the conclusion that if you made dollars out of nickels, or if you carried out the principle of the Goldsborough bill by buying in bonds and Issuing currency, that you could carry on the deflation of our money to the point of worthless- ness; yet in the case of such commodities as we produce a surplus of in this country and have no foreign market for you could not benefit the price leveL and the general 1934 CONGRESSIONAL RECORD— HOUSE 233 price level would not go up as a fair illustratioQ. We have seen that in the recent devaluation. Mr. QOLDSBOROUGH. Will the gentleman not take too much of my time? I have not very much left. Mr. McGUGIN. In devaluation we have seen cotton go up. but not wheat, as a result of money, because there is a foreign market for cotton but not for wheat, Mr. QOLDSBOROUGH. Wheat went up until they found out that the Govenunent did not propose to buy all the gold that was offered at the advanced price. Mr. McGUGIN. Does the gentleman feel that by increas- ing money you can now raise the price level? Mr. QOLDSBOROUGH. There is no possible doubt about that. Mr. CHRISTIANSON. Will the gentleman yield? Mr. QOLDSBOROUGH. Yes. Mr. CHRISTIANSON. Is the gentleman aware of the fact that there has been a startling increase in the domestic price of wheat? I desire to call his attention to the fact that the Winnipeg market used to be lower than the Mitmeapolis market. TTiey run pretty much neck and neck, with the difference that the Winnipeg price was based on high-protein wheat, which was worth about 8 cents a bushel more than the ele- vator rim, so that actually before the devaluation of the dollar the Winnipeg price would be about 8 cents higher than Minneapolis. During the last month or two — in fact, since last summer — the Minneapolis price has run from 20 to 25 cents a bushel higher than Winnipeg. Mr. QOLDSBOROUGH. I thank the gentleman for his very interesting comment. Mr. CROSS. Our wheat now is higher than their wheat, which shows that the present program of buying gc4d is helpful. Mr. QOLDSBOROUGH. Mr. Speaker, I have only 2 or 3 minutes more, and I am not going to be able to cover the ground in a satisfactory way. Mr. HANCOCK of North Carolina. Will the gentleman yield? Mr. QOLDSBOROUGH. I yield. Mr. HANCOCK of North Carolina. I have been very much interested in the gentleman's discussion of the mone- tary system, and I want to ask him if he does not think that in the last analysis the problem can be at least partially solved through a change in the banking or, rather, credit system. I am asking that for this reason: Does the gentle- man or anyone else know of any formula that can be worked out that will prevent actual currency, as the gentleman terms it. fnxn becoming credit currency? Is there any way that you can prevent the banker, if it were desirable, from swapping a deposit slip for a $10 bill or credit for the cash? Mr. GOLD6SCMIOUQH. Most of the bank deposits are based on credits, I will say to the gentleman. Of course, you cannot prevent what the gentleman is talking about. You cannot prevent loans from being made, and I would not want the gentleman to think that I am opposed to paying Interest. Of course, capital is acctunulated labor; and if accumu- lated labor is employed, it should be paid for. There is no question about that. The SPEAKER pro tempore (Mr. Paiks). Ilie time of the gentleman from Maryland has expired. Mr. LUCE. Mr. Speaker, I ask unanimous consent that the gentleman from Maryland may have 15 additional minutes. The SPEAKER. Is there objection to the request of the gentleman from Massachusetts? There was no objection. Mr. OOIJ36BOROUOH. I will say to the gentleman from North Carolina that as long as we are human beings I do not believe we will ever be able to get akmg without credit, but it ought to be theoretically powible to pay our debts, and under our present system they cannot be paid. Mr. HANCOCK of North Carolina. I fuUy agrM witb tbls •tatement of the gentleman. Mr. OOLDSBORO'DGR. Becaon, as soon as yon begin to pay them you cause a deflation, whereas if you had a com- pensated dollar and could issue more money as debts were paid, it would at least be theoretically possible for the coun- try to get out of its debts, and that Is the only way I know that it can be done— with a managed currency. Mr. HANCOCK of North Carolina. That sUtement is predicated upon the quantitative theory of money, rattter than its velocity, up to a certain point, anyway, is it not? Mr. QOLDSBOROUGH. Of course, they go together. There are only two or tturee things more that I want to call to the attention of my colleagues, because a tuoader discussion would take a much longer time. I guess in the whole world there has never been a greater historian than Hume. He makes this statement: PalUng prices and miflery and destruction are InseparaMe com- panions. The disasters of the Dark Ages were ca\ued by de- creasing money and falling prices. With the increase In money labor and Industry gained new life. Some years ago Winston Churchill was writing an article on the effect of the discovery of the precious metals shortly after the discovery of the American 0(Mitinent in the early part ot the sixteenth centiur. and this is what he said: It Is said that we had forgotten the grim laws of supply and demand: as If these laws were absolute, constant, hmltlxi^ factors fCM«ver beyond the reach of human control. There Is no limit to human demand, and there is no limit to the power of mankind to meet that demand. For hundreds of years, In the Middle Ages, thi^ laws of cupply and demand were stationary. Everything worked, year after year, at a untformly low level, and aU the populations lived miserably. Then, on a sudden, wages began to rise, enterprise began to quicken, all kinds of new articles and utensils appeared in the oottages or dwtilings of the working people. All kinds cf new luxuries and comforts opeatA to the rich and the middle classes. The laws of supply and demand began to work on a much larger and expanding scale. What had happened? A few small ships had eome back from across the Atlantic Ocean full of goM and stiver, and a gradual, subtle process of inflation had set In. It could not have been the trade of the New World which had refreshed the Old. These poor little ships coiild only bring spoonfuls of merchandise, and every voyage took over half a year. What they teought was the precious metals which altered. In the aeyise of expanding, the standards of value throughout the wortd. and made to tho« gen- erations expansions In the good Uvlng of the human race which have never since been lost. We cannot, Mr. Speaker, disregard tbe oooditlon that this country is in. We have a potential productive capacity in this country sufficient to make evor family In the oountxr reascmably weaUhy. and yet we have stark poverty following the steps of 75 percent of our people. Your production can- not increase any faster than Is justifled by your monetary base, if you are on a monetary basis, withoirt a falling inlce level, which of itself stops production. Tills cannot be dime. ■nils country, early in the nineteenth century. Imbibed the philosophy of Francis Baoon that the way to progress was to experimentr-experiment We eiuharfced on a vast system of medumizatkm, which resulted in oar railroads. our steandK>ats, our mowers, our improved idows, our im- proved machinery, our good roads, our radio, our moving pictures, and our automobiles. But throiis^ all this period we neglected the deductive process, the process of the ancient philosophers, and the process which culminated in the doctrines of Jesus Christ. We do not know how to distribute what we can produce. It is deductive reasoning which, my colleagues, is indis- pensable in our social philosophy. With this I will conclude. The problem of production has been solved: the problem of distribution, the sptritual prob- lem, is the one that faces the American people. [Applause.] The SPBAKKR pro tempore (Mr. Paueb). By special order of the House, the gentleman from PenosFtvanift ^^^' ELLDrsoGBK] has 3 minutes to addrsss the House. THS nsTKicT or OOLtnOM ugvot BIXX lir. BYRNS. Mr. Speaker, tf the gentleman from Pwa* sylvanla will yield, I understand the lady from New Jersef [Mrs. NotKml has just reported the bill HJl. 6lgl. regu- lating the sale of liquor in the DIstrtet of OolumMa. I want to ask if->"-«->^'« coiMsnt tlMt that Wtt maf be taken up 234 CONGRESSIONA tomorrow after the reading of the Journal and considerel under the general rules of the House. The SPEAKER pro tempore. The gentleman from Tei- nessee asks tmanimous consent that the bill HH. 6181. re- ported by the Chairman of the Committee on the Distrlil; of Columbia, shall be taken up tomorrow after the reading of the Journal and the disposition of matters on ttie Speaker's table and considered under the general rules eeded up. but in order to provide true relief for home ownei-s, the law must be changed and for that purpose I introduced two bills at the very opening of Con- gress last Wednesday, and I expect to Introduce further bills on this subject, probably tomorrow. At this point I want to say that if the home owner. If the farm owner wants to save his home, he should, he must, take a real Interest in these bills, become acquainted with their provisions, and organize support for them in his community. In future broadcasts I shall discuss this topic and shall explain the bills which I have introduced. Mr. Kurt. What Important social legislation are you going to sponsor. Congressman Ellxnbogen? Congressman Ellinbocen. A system of old-age pensions deserves Immediate consideration by the Congress of the United States People who have given the best years of their lives in honest and industrious labor and who have contributed to the wealth of the country, deserve better treatment than as objects of charity I am going to bring this problem strongly to the attention of Congress, and with the support of the people of this country we can obtain laws which will guarantee a greater measure of security for people of old age than we have ever known before. Mr. Kurt. Do you believe that the Congress will follow the leadership of President Roosevelt? Congressman Ellenbocen. In this emergency unity of purpose and of action are Imperative. Our people have confidence in the President and in his policies. Tliey demand that the Congress support the President. I, for one. shall fully support his measures for the reUef of our people and I beUeve most of my coUeagues will do likewise. Mr. Kurt. Congressman Ellenbooen. what other problems do you think will engage the attention of this Congress? Congressman Ellenbocen. Mr. Kury, these problems are so niunerous that I can only give some of them at this time 236 [aL CONGRESSIONAL RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE lAter on, I hope to discuss them more fully in this series at broadcasts. Here are some of them: The Veterans of the Spanish-American War and of the Woiid War are not rocelving the benefits to which, in fairness and in Justice, they are entitled. Economy measures affecting them have been altogether too stringent. The Congress should pass laws which will proTide more equitable treatment and more just bene- fits for our veterans. Workers of all classes, labor and white collar, skilled and un- skilled, trained and professional, must be protected against long hours and miserable pay. The sweatshop must be uprooted and destroyed. Otir income-tax system needs drastic changes. Taxes should be assessed according to ability to pay. Increase surtaxes on swollen incomes. Raise inheritance taxes on large estates. Strengthen the gift-tax laws to prevent the evasion of the in- berltance taxes. On the other hand, taxation must cease to be an ever-increasing burden on the back of the great middle class of our people. Furthermore, we must eliminate the wasteful use of the taxpayer's money, whether It be appropriated for ordi'- nary expenditures or for emergency relief. Ck>ngres8 must call a halt to the evasion of the income-tax laws by selfish persons of great wealth; there must be no manipulation of the people's money or of our financial markets at the ex- pense of the innocent investor of modest means. The money of depositors and the investments of the people should at all times be safe. Our banking laws must be altered to prevent for all time the recurrence of such panics as we witnessed last March. Reductions in charges for electricity, for gas, and for trans- portation, more stringent regulation and 8up«:vlBion of utilities are urgently needed. ^ ^^ „ ,a.^ The American people, through the Ck)ngre9B of the United States and the President, must deal prudently but firmly with our foreign debtors: some of them have deliberately compromised their honor to protect their pocketbooks. These are the duties of the Congress at the United Statet — as I see them. As for myself. I pledge that every ounce of my strength, oU the energy that I have, my education, my training and my ex- perience shall be devoted to these measiires. To you, the people of Pittsburgh and of Pennsylvania, I pledge that your interest and your interest alone, shall guide my thoughts and my steps and shall determine my actions in the Congress of the United States. Mr KxTBT. I thank you. Your Interpretations and views of the problems of the regular session of the Seventy-third Congress are most enlightening. LEAVE TO FILE REPORT ON H.R. 6181 Mrs. NORTON. Mr. Speaker. I ask unanimous consent that I may file the majority report on the bill HJR. 6181 by midnight tonight. Mr. MARTIN of Massachusetts. Reserving the right to object, may I ask if there is a minority report? Mr. PATMAN. I ask unanimous consent that the mi- nority views may be filed with the majority report. Mrs. NORTON. Mr. Speaker, I will be glad to Include that in my request. The SPEAKER pro tempore. Is there objection to the request of the gentlewoman from New Jersey and the gentle- man from Texas? Tlxere was no objection. RELIEr FOR VETERANS Mr. LUDLOW. Mr. Speaker, I ask unanimous consent to extend my own remarks briefly in the Record. The SPEAKER pro tempore. Is there objection? There was no objection. Mr. LUDLOW. Mr. Speaker, believing that there is danger that great injustice will be done to thousands of worthy veterans who are now employed, or who hereafter will be employed, under the CivU Works AdministraUon. I have today sent a letter to President Roosevelt suggesting to him the advisability of issuing an Executive order exempt- ing Civil Works Administration workers from Veterans' Regulation No. 10. which would cut off the pension rolls many veterans engaged on civil works and would reduce the pensions of many thousands more to $6 a month. My letter to the President follows: Deax Mb. P««5rorwT: ^ ^ ^, „»..♦ I am taking the liberty of bringing to your attention what •eems to me to be an obvious injustice to many thoiisands of worthy veterans who are now employed, or who hereafter are to be employed, as workers under the Civil Works Administration. as I believe you will want to correct this situation by an Executive order when it is brought to your notice. , „ * To my surprise I have Just learned that paragraph X of vet- erans' Regulation No. 10 Is to be so construed that aU veterans (of whom there are many thousands) who are working on tempo- rary Civil Works Administration projects and who are drawing pensloQS wlU be dropped from the pension rolls or wlU have their pensions reduced to #6 per BBOBth wlUte to amployMt. Tta* erans' regulation to which I Mfar Is aa foUova: " No person holding aa oflhce or peslUon. appointive or elective, under the United States Oovenunant. or Um municipal govern- ment of the District at ColumMa. or under any eorporatlon. tlM majority c^'ttae stock of wbleh Is owned by the United States. shall be paid a pension or emergency ofBesra' retirement pay. so l-AGB PENSXOlfS Mr. CMALLEY. Mr. Speaker. I ask unanimous consent to extend my remarks In the Rbcoid by printing a speech delivered by Representative Raitoolfh last Sunday. The SPEAKER- pro tempore. Is there objection? There was no objection. Mr. CMALLEY. Mr. Speaker, under ttie leave to extend my remarks in the Record. I include the foUowtng radio address delivered recently by Hon. JBomioi Rambolfh, of West Virginia: The world has Just passed tfaroiagb 4 years of experience which has tried the very souls of nuan and woaaen. During this walk throtigh the valley of the shadow we have learned many lessens which we needed to leara. and It seems to me that ooe oj tho greatest lessons which have oome out of these 4 yean of hard- ^p has been Uie positive evldeaoe that we are our brother's keeper whether we realize this f*ct or not. I have heard an I experienced hvmter of big game say that during the time of drought when water is scarce in the Junglas of the b^ cam* oounteies. the fiercest of animals take their turn at tbe cmly waterh^ and that they do no kllllag there because they tnstino- tlvely reallce that harmony and oooperatlon are eaaential Mr During the past 4 years tbe whole of the human race has Uteridly been driven to clvllteatlon'e common waterbote. aadas we cathered anmnd this watering place we were forced to ^*^' the rich and the strong giving aid to tbe weak and the poor. Beeina the absolute necessity of this form of frtendly oooperatloa. the president of the United States began Immediately after eater- mg olBce last March to create j^aaa for the arte pmpoee of distributing fairly the aeceeeltles of life and the opportuultlee for earning a living. .---*. I am deeply grateful because I can truthfully say. as I spsak to you today, that the President's program of business recovery tlirough organised cooperation has brought us out of the darknem of the Jungle In which we have been loet for tbe past 4 yean. Md now that we have learned the practical value. of mass oooperatton It is both our duty and our prlvUege to appropriate this »««—»-'«— 1934 CONGRESSIONAL RECORD— HOUSE 237 t 236 CONGRESSIONAL RECORD— HOUSE prcB la >- i- havlig a: Id sweepl ig pea- of aim mm Po]ie Preside it m- Df Of Of dtal t\e old sty ia •nd to uae It for our future guidance. If friendly cooperation belpfvU to people caught in tbe maelstrom of a great world nomlc upheaval. It will be equally helpful in tbe time of perlty, when we do not face the necessity of fighting shoulder ihoulder to defeat otir common enemy, poverty. Having gone through this despairing depression, and Men and felt the effects it has produced in terms of misery human suffering. I was truly grateful to Dr. J. B. Pope for invltl|ig me to speak to you on the subject of what I conceive to be of the most commendable and necessary forms of cooi>erat^e effort. I have reference to the great movement which la this entire nation, the object of which is to provide old-age slons for men and women who have re&ched the late afternoon life without the means necessary to sustain them. A group of thoiightful and far-sighted men and women ha(ire organized the National Old Age Pension Association, whose and purpose are to secure tbe necessary legislation to Insure and women against starvation in old age. Their leader. Dr. has given me a very clear outline of tbe legislation they are Ing and I wish to tell you why I favor the program and why believe you should do the aame. First. The idea of pensions for old people who can no longter work and who must become public charges Is in full harmony wl^h the " new deal " philosophy of our national leader. The has already sounded the death knell of child labor. We have proved working conditions and hours of labor and the basis compensation, all of which has met with the hearty approval the American people, and I am sure that I voice the opinion every charitably inclined person when I say that the new should be extended to include practical help for the aged. Second. Tbe plan and purpose of providing pensions for aged Is. as I conceive the facts, in full harmony with the Oold4n Rule laid down by the Master as a sound rule of human conduct I am mn that there is no person who would wish to face '•ge burdened by the misery of poverty. We cannot truthfully In behalf of civilization, that it has produced a race of humin beings who do unto others as if they were the others, as long we ijermit the old and decrepit people to be sentenced to pocf houses. Third. The old-age pension plan is Inspiring because it the very commendable purpose of helping to keep self-conflden^ and courage alive in the hearts of men and women in the hour adversity I have heard It said that a man is never whipped imtil he accepts defeat in his own mind, and I believe this to be I earnestly believe, therefore, the old-age pensions would the effect of kindling anew the fires of hope In the breasts those who have met with temporary defeat, thus enabling tbero carry on and to reestablish themselves without becoming public charges. Fourth. The old-age pension plan Is sound because it gives Individxial a chance to profit by rendering useful service to othei^ Apropos to this thought a very distinguished philosopher once salt " Help thy bxother's boat across and lo ! thine own hath reach€ i the shore." That is sound philosophy because it pays dividen•*•"•* It le In harmony with my conception of practically applie i Christianity. I do not believe that the Nazarene would condema oW people to a poorhouse. I believe that He would be shocked t y the very thought of imprisonment for life in a poorhouse* then foee. 1. too. am shocked by the thought. We Uve In the rlcha t ootmtry on this earth; we have an abundance of everything thi t human betnge can uae. both tbe neceesltiee and the luxuries- ee Uve la one Nation of thia world where every form of freedom i true. ba '6 i>f io bolt otir the suu- ntid un- tlie jxxie faerson. male or female. Ijetween the ages of 21 and 45, on and after the passage of the old age pension act. to pay Into the Post Office Department, through the Postal Savings Division, a very small percentage of all gross earnings from salaries, wages, hire, or from any other source, whether it be from salary, commis- sions paid, from dividends earned, or from profits arising from any transaction; the retiims to be made monthly together with the payment of assessments such as the Congress may levy against such earnings or Income. Fifth. The President of the United States shall appoint a direc- tor of pensions, to become the chairman of the United States Pen- sion Board, the other members of the board to comprise the Post- master Geneiral. the Secretary of the Treasury, and the Secretary of Labor, the said board to have the power to scale downward the assessment of tax against earnings, as the occasion and conditions of the pension fund may seem to warrant. In other words. If it Is found that less than one half of 1 per cent of earnings of all persons over 21 and not over 45 will suffice, they shall then be authorized to reduce the scale of rate of assessment accordingly. You have, in these five proposed principles, the sum and the substance of what will be required In order to permit the aged people of this cotmtry to approach their declining years without the fear of poverty. My object In speaking to you on this subject Is to Inform you. as fully as I can In the few minutes which have been allotted to me, of the plan for providing {Tensions for old people and to ask that you commimicate with me by letter, offering any suggestions you may have in mind for the Improvement of this proposed program. I have given you a brief outline of my own personal reasons for favoring this proposal, but I shall of course be guided also by the wishes of my constituency in the Second Congressional District of West Virginia, when the time comes to vote on legisla- tion providing this pension protection to unf ortvmate old people. May I not suggest, therefore, that those outside of my district who ™ay be listening, communicate with theh* own Representatives in Congress, conveying to them your wishes and your suggestions in connection with this Important plan. Before cloeing I wish to assure you all that we who represent you here in Washington approach our task at this session of Congress with greater hope and courage than we had at the last session, and our hopes are not based upon ephemeral caxisee. Millions of men have been put back to work since Congress adjourned last summer and the words " business depression " have been ptuhed off the front pages of newsjiapers all over the country and their place has been filled by the words " business recovery." We have genuine cause to be thankful throughout the length and width of this great country of o\jr». because we have weathered p^^rt^os will bTdrowed f ^ the pension roll, or will have their Ut 1. both our auty ana our pnvu... w mpp^.^^. 1934 CONGRESSIONAL RECORD—HOUSE 237 the worst storm that most at ua hav» ever known. Ova national leader has demonstrated. thro\igh his message to Congpress this week, and by the expreealon on his face and ttie tone of his voice that he, too, approaches the new year in a spirit at hope and courage. There Is no escaping the fact, my friends, that we are safely established on the road that will lead us back to happiness and pro^>erlty. Let us not forget, then, our obligation to those poor old persons who fear the poorhouse more than the average persons feared the business depression. We have passed through the worst and we now have it behind us, but there are millions of worthy old men and women in this country who now and In the future will face a real cause of fear a hundred tlnies greater than the fear of depressed business. Ingrautude Is among the more reprehensible of human quali- ties! Let us not be uivgrateful for our delivery from the fear of poverty, and let us demonstrate our gratitude for this great blessing by helping to provide protection to those who are not in position to provide it for themselves. There is plenty In this worid for all of us. We cannot take anythmg with us when we cross the Great Divide. Moreover, the riches which most people accumulate come as the result of aome form of cooperation from others. It is a great blessing to possess riches, but it Is a greater blessing to possess, also, a heart that is willing to use riches in behalf of those who are helpless. Mr. BLACK. Mr. Speaker, I ask unanimous consent to address the House for 45 minutes. The SPEAKER pro tempore. Is there objection to the request of the gentleman from New York? There was no objection. Mr. BLACK. Mr. Speaker and gentlemen of the House, this speech of mine is designed to meet several attacks that have been made during the recess on the N.R.A. as uncon- stitutional. I have in mind principally articles written by our distinguished colleague, the gentleman from Pennsyl- vania [Mr. Beck], and particularly one published in the Novembei issue of Fortune. The Constitution is a book of life. It is dynamic, gener- ating, at the will of the people, power in the Government strong enough to protect the Nation in all hazards of its existence. It is not a museum curio .to be reverently gazed upon as the keystone of a former civilization. As the court in its early days said, in passing upon the case of Bfartin against Hunter: The Instrument was not Intended to provide merely for the exigencies of a few years, but was to endure through a long lapse of ages, the events of which were locked up In the inscrutable purposes of providence. It could not be foreseen what new changes and modifications of power might be lndiq>en8able to effectuate the general objects of the charter, and restrictions and specifications which at the present might seem salutary might in the end prove the overthrow of the system Ita^. The Constitution is not a moth-eaten blanket for smoth- ering progress to be dropped on the American scene by such staid scholars as my colleague Mr. Beck, whenever the rights of man are being asserted in a way that jars the more stationary of our statesmen. They are ever ready and willing to demonstrate glibly the outlawry of the new. These extreme conservatives even thought it heretical when one of their most trusted guides. Justice Pitney, reluctantly conceded that the law must press on, in stating: Let it be admitted that mere novelty Is not a ground of con- stitutional objection, since It is the appropriate function of a legislature to change the laws. It was quite to be expected that when President Roosevelt propounded the National Recovery Act the "die-hards" would invoke the Constitution as a bar to the new deal. Mr. Bkck, more or less awed by the onrush of the Blue Eagle crusaders, and without appreciating their lawful in- tent, props the present constitutional issue in this unilateral pose: Can the Constitution be temporarily suspended to meet the exigencies, real or imaginary, of an economic emergency? Mr. B«CK, enjoying at the poUtical roadside a well-earned rest after his skillful and successful leadership of the wet caiise was startled at the unseemly pace of the White House Intelligentsia and thought they were the drys coming back. So he rushed to the protection of his cherished Constitu- tion which actually was in no danger. While it is true that Ii4r. Beck views the hurried marchers with alarm, they form an army with banners and the banners are for constitutional progreas. Tbegr are not attarlrinf the Oomiltatkm. but they are attacking with tt. Nd advocate of the NUA. asks for a suspension of the ConstitTition, for that is beyond the power of government. Mr. Beck, as well as they, under- stands that an act suspending the OoDstttution would Ipso facto be a legislative nullity. The Cmistitution keeps ^ep wiUi the ttanes. "Hie Supreme Court in Pmsacola Tdegraph Co. against Western Union, gives this vivid picture of constitutional devriopment: The powers thus granted are not confined to the Instnunentall- ties known or In use when the Conatitutlon wmi adopted, but they keep pace with the progresa at the country and adapt themaelves to the new devetopments of time and circumstancec. They extend from the horss with the rider to the stagecoach, from the sailing vessel to the steamboat, from the coach and steamboat to the railroad and from the railroad to the telegraph as theee new agencies are successfully brought into use to meet the demands of increasing population and wealth. They were Intended for the government of the business to which they relate at aU times and under all circtimstances. It is a fallacy to assert that the planners of the NitA. insist that Ccmgress obtains power as the result of an emergency. Those who advised this scheme of recovery were too careful in their planning to overlook the historic back- ground of constitutional powers. They understand that an emergency invests Congress with no extraordinary powers. It simply justifies Congress in appljring sufficient of its latent powers to meet new conditions. Power proceeds from the Constitution, not from the emergency. Justice pay has stated the rule with great clarity: The Constitution of the United States is a law for rulers and people equally in war and in peace and covers with the shield of its protection all classes of men at all times and under all circum- stances. No doctrine Involving more pernicious drcumstanoes was ever Invented by the will of man than that any of lU provi- sions can be suspended during any at the great exigencies of gov- ernment. Such a doctrine leads directly to anarchy or dcepotiem; but the theory of necessity on which it is baaed la false, for the Ooverxunent within the Constitution has all the powers granted to It which are necessary to preaervc its existence, as has been happily proved by the result of the great effort to throw off its Just authority. Congress naturally in normal times does not, for fear of the voters' reaction, unduly assert itself. Should Congress abuse its lawful power. Judge Miller, in Kilbum against Thompson, points out that: The remedy for this, however, Ilea not In the abuse by the Judi- cial authority of its function but in the people, upon whom, after all. \mder our institutions, reliance must be placed for the correc- tion of abuses committed in the exardse of a lawful power. The fact that Congress generally does not use its powers to the last degree does not paralsrze them. Ibey are alive and ready for emergency, ready to operate according to the popular will, in line with Uie viewpoint expresKd by Justice White that: Althoiigh an emergency may not call Into life a power which has never lived, nevertheless, emergency may afford a reason for the exertloii of a living power already enjoyed. In an emergency the congressional power may be applied to objects that in normal times constitutional limitations would save from the touch of government. The powers are the same and the objects are the same, but the emergency gives them a more intimate relevancy to government and usually the congressional powers are called into operation to regulate them. The public interest being paramount, the shield of the fifth amendment does not intervene and pri- vate rights are remarshaled for the public objective. Ttie freedom guaranteed is not a freedom to destroy government. The unbridled exercise of so-called " rights " might accom- plish such destruction in an emergency and by so doing viti- ate themselves. The guarantor does not engage in Joipt bond with the guaranteed to aocomidlsh mutual destruc- tion. The emergency alteration of the usual relationship caused courts to regulate rents in the District ^ Columbia as the result of the war and caused the Supreme Court, in Block against Hirsch. to uphold the congressional a^ there declaring: Congress has stated the unquestJooable embarrassment of gov- ernment and danger of the public health in the existing condi- Uon of things. The ipace in Washington is necessartly monop- 238 CONGRESSIONA t. RECORD— HOUSE January 8 ollacd In eompmnMrtlj few hands and letting portions of It Is ts much a business as any other. Housing Is a necessary of life, tU the elements of a public Interest Justifying some degree of publ c control are present. It was but natural to expect that in the course of tie development of the United States considered absolutely it relatively as a world competitor a more concentrated organ - zation of economic power would evolve with a paralleled political set-up. This could only be achieved at the sacr - flee, to a sizable extent, of individualism. Mr. Bkck is hoi - rifled at the regimenting of industry under the NJI.A.. b\it I predict that as other countries become more intensely 01 - ganlzed in the space of a few years there will be a vigoroi s public demand for an economic system here more close y knit with government, so that we can offset the organized economic powers of all nations. A national breakdown may force regimentation to le ordered years before it would normally develop. The du< - process clause being consonant with the general purposes agenhart. which was the medium of the Supreme Court nullifsring as unconstitutional the child labor law. By a majority of one, the Court declared that goods produced by the impairment of child life might have the protection and fostering of interstate commerce. Mr. Bscx's school relies on this judgment as destructive to the NJI.A. The Court made this proposition: There is no power vested in Congress to require the States to exercise their police power so as to prevent possible unfair comoe- titlon. The grant of power to Congress over the subject of Interstate commerce was to enable it to regulate such commerce and not to give It authority to control the States in the exercise of the police power over local trade and manufactures. The marked difference between the child labor law and the National Recovery Act lies in the effort by Congress in the former to suppress an antisocial labor condition permitted in a limited area of the country, while in the latter Congress attempts to cure by legislation a Nation-wide economic dis- ease which has absolutely clogged commerce. In the child- labor case conservative judges, bowing to the Cardozo philos- ophy that a judge is not cloistered, readily understood that a welfare lobby had induced Congress to invoke its com- merce power to remedy an isolated social evil. The Court can, in the NJl.A., without looking beyond the act, ascertain the motives of Congress in the preamble to the bill. More- over, no place was a sanctuary from the depression, and news of it has seeped into the most sacred temples. At least three members of the present court. Justices Brandeis, Stone, and Cardozo, are quite willing to have a judge be informed as to current events in the world outside. The Court under- stood that child labor shocks the moral sense of the national unit without working any present profound commercial harm, while general unemployment, leading to mass hunger 1934 CONGRESSIONAL RECORD— HOUSE 239 which means a failure of government in a country richly endowed, makes it imperative for government to readjust the commercial system which it bears. So it is repugnant to every theory of sovereignty to deny the legislative power to exclude from the stream of interstate and foreign commerce products offered under a system whose continuance woxild destroy the Nation. In the light of our jurisprudence it is tantamount to the suggestion that Congress may protect the morals by penahzing the transportation of women for Immoral purposes; that it may protect health by banning misbranded drugs and adulterated foods; that it may dis- courage the gambler by barring lottery tickets from trans- portation in interstate commerce; but that it may not take action to conserve the whole of our commerce because of the police power of the States or the exaggerated right of the " rugged individualist ", who generally associates with others In business enterprises, to liberty of contract. In a case subsequent to Hammer against Dagenhart the Supreme Court sought to avoid the apparent restriction put upon the conmierce powers of Congress in that very much condemned 5-to-4 decision, for when Stafford against Wallace came to the Court for its verdict the judges opened the way for Congress to assume the imperative control over commerce set out in the N.R-A. This litigation involved the validity of an &ct of Congress which attempted to regulate the methods of doing business by commission brokers acting within the various stoclcyards of the United States. There was no question but that in many respects these trans- actions took place all within a State and concerned matters usually left to Stote regulation, but the Court held that the act was constitutional on the ground that the activities of the commission brokers, unless regulated, were a burden upon interstate commerce. The Supreme Court has time and again upheld the power of Congress to suppress obstruc- tions to commerce. The child labor law was to suppress a social evil which the involved States could themselves have suppressed. It is quite definite that acts in relation to inter- state commerce come within the congressional jurisdiction. The Minnesota rate cases lend sanction to this broad power of Congress. Said the Court : The authority of Congreas extend* to every part of Interstate commerce and to every InstrumentaUty or agency by which It Is carried on, and the full control of Congreaa of the aubjects com- mitted to Ita regulation Is not to be denied or thwarted by the commingling of IntersUte and Intrastate operations. ThU Is not to say that the Nation may deal with the internal concerns of the State, as such, but that the execution of Congress of its congresslonsJ power to regulate Interstate commerce is not limited by the fact that intrastate transactions may have become so Interwoven therewith that the effective government of the former Instantly controls the latter. In United States against Perger, Chief Justice White held that the power of Congress includes the authority to deal with obstruction to interstate commerce and with a host of other acts having relation to or influence upon interstate commerce, although not interstate commerce in and of themselves. The Nation must act in uniformity toward all the States. That it did not in the child labor law; that it does in the NJIA. The early case of Groves against Slaughter established that Congress cannot pass a nonintercourse law as among the several States nor impose an embargo that shall affect only part of them. Congress did try to impose such an em- bargo in the child labor law, but in the N.R.A. an effort has been made to lift the embargo the depression clamped on commerce in and through all the States. The lottery cases, the Mann Act, and the prize fight film law did prohibit interstate commerce advancing objects thought to be deleterious. The child labor law sought to obstruct innocuous objects whose manufacture was attended by group evils entirely in the consigning State. These in- terstate commerce laws, pfisscd as a sop to reform and sus- tained by the Supreme Court, have shown a power in Con- gress over interstate commerce that does not concern Itself primarily with the commercial aspects of the situations comprehended by the legislation. If Congress has power by prohibition to guard morahty, it should have power by imto- hibition to guard business morality intendlnc a oooservation of markets and a free flow of commerce. Congress, in the Antitrust Acts, the Grain Futures Act, and similar statutes, has been upheld in its efforts against de- liberate strangulation of commerce. Surely Congress, when it sets up a plan of industrial cooperation as a stimulus to commerce, will receive judicial approbation. If Congress could provide for competition by the Antitrust Acts, it can regulate it by the N.RA. Congress under the NJIJL is making definite criteria of fair competition having already declared that the indefinite activity, unfair competition is imlawful. The Federal Trade Commission Act declared that unfair competition in interstate commerce was unlawful. It did not define unfair competition, but left such definition to the courts. Now. Congress has established a method to determine what imfair competition is in each industry. As the Court sanctioned the Federal Trade Commission, it will in all logic sanction the Recovery Administration. The Child Labor case, with a 5-to-4 decision passing on a statute whose object was plainly not commercial, will not prevail against the his- torical development of the interstate-commerce powers of Congress, the emergency inspiration for their fullest use and the disaster that would attend the invalidating of the statute. Could the then Court have anticipated the present national plight, it would not have stated itself so broadly to extinguish the child labor law. Read in the light of today the opinion can tolerate much editing. As Justice Brandeis has stated: The Cotirt bows to the lessons wf experience and the force of better reasoning, recognizing that the process of trial and error so fnUtful in physical sciences Is appropriate also in the judicial function. It Is far from sane expectancy to believe that the nine alert and learned justices of the Supreme Court, not insu- lated from the economic terror abroad, will permit the opinion in the Child Labor aue to thwart the effect of Congress to allay the depression. It will be difficult enough to cure it by any form of legislation* and certainly any bill less comprehensive than the National Recovery Act will be inconsequentiaL It might be well for thote who believe that Congreas has taken too bold a step forward in this matter to read the startling observation made sometime ago by O. Lowes Dick- enson, an English university lecturer, under the title " Let- ters from a Chinese official ": Like the prince In the faWe. you seem to have relaMed from his prison the genie of competition, only to find that you arc uxiable to control him. Tour Icgtslatlon for ttM pact huodred yean Is a perpetual and fruitless effcxt to regulate the disorders of your economic system. Your poor, your drunk, your InoMnpetent. your aged, ride you like a xiightmare. Tou have dissolved aU hu- man and personal ties, and you endeavor In vain to replace them by the Impersonal activity of tha sUt«. The salient characterisUc of your civtUzatlon U its IrresponsIbUlty. Tou have liberated forces you cannot control; you are caught yourselves in your own levers and cogs. In every department at bualnese you are substi- tuting for the individual the company, for the workman the tool. The making of dividends is a universal preoccupation: the weU- belng of the laborer is no one's concern but the state's. And this concern even the state is incompetent to undertake, for the fac- tors by which it is determined are beyond its control. Tou depend on varUtions of supply and demand which you can neither deter- mine nor anticipate. The failure of a harvest, the modification of a tariff In some lemote country, dislocates the Industry of mU- lions tho^is^n'T'' of mUes away. Tou are at the mercy of a pros- pector's luck, an inventor's genius, a woman's caprice — nay, you are at the mercy of yoiu- own Instruments. Tour capital is alive, and cries for food; starve it and It turns and throtUee you. Tou produce not because you will but because you must; you consume not what you choose but what Is forced upon you. Never was any trade so bound as this which you call f roe; but it is bound not by a reasonable wiU but by the aocumulatad IrrattonaUty of caprice. We do not have to be as pessimistic about the outlook as this burning criticism of the modem industrial sjrstem would make one. Neither rose-colored glasses nor blue afford the precision required for a statesmanlike survey of the proUem to be negotiated. We would not be Justified in a driftiner policy, and our present hope of salvation Ues in coopomtiaa. Ilie ezperi- 1 I h iU ^ P I 240 ment proposed by Congress should be accepted in the spjrit of Washington's Farewell Address: The experiment at least 1- recommended by every ■entlmjnt which ennobles human natxire. The Court, as alert as Congress to safeguard the pu welfare will appreciate the tremendous pressure on Congi for legislation of a distinctively radical aspect to those ^ho have survived on the laissez faire system and are prepared to sink with it. A study of the Supreme Court action on the constitutli >n- aUty of Federal legialaUon is heartening to the advocacy of the new policies. In the 144 years of its existence, in whfch period approximately 140,000 cases have been decided. CONGRESSIONi^ L RECORD— HOUSE January 8 he Supreme Court has declared only 60 congressional enact- of is 3u- in his ments unconstitutional. Every presumption is in favoi the constitutionality of the considered act. and unless i squarely in violation of the organic law, the court will upljold the legislation. The NJl-A. has already received the sanction of the preme Court of the District of Columbia. The court, commenting on the present state of the Nation, made striking and rather broad comment: It may happen that other emergencies prove more perlloi* to national life than war Itaelf. War may tend to unify a nai Ion. There are emergencies that tend to disorganize and to desiroy. Another maxim Is " the safety of the people Is the supreme liw. This concept must have Its place In our laws dealing ^^ ef^"" Kcncles that threaten national safety or stabUlty. While i the courts held that the Constitution Is not sxispended or set aslds by war or national emergency. It Is thought that the Ckjnatltutlon and aU other laws must be read In the light of and. to some exi ent, subject to the primal and fundamental concept of the necesslt; ' for aelf-preservaUon. The Agricultiural Adjustment Act has already twice celved Judicial imprimatur the same principles of cons' tlonal law being invoked on which the NJI.A. is predi" The opposition to the N Jl-A. is put to it to imderstand the Congress can regulate what is on its face a strictly '' state commercial transaction. The principle of the N extent of congressional control over such intrastate has been af&rmed several times by the highest Court Shreveport case, which received much congressional a tion, the Supreme Court supported the Interstate Co ~ Coounission in an action taken on railroad rates from ton and Dallas to other points in Texas on the ground such rates were discriminatory against interstate co "^ transported from Louisiana similar distances into T There Justice Hughes stated that the authority of Coni extended to the maintenance of conditions under wtiich Interstate commerce may be conducted upon fair terms, and that while Congress did not possess the authority to reg date the internal commerce of a State, as such, it did have p )wer to foster and protect interstate commerce and to take n eas- ures necessary or appropriate to that end, and further, that the power to regulate interstate commerce was granted to Congress to make impossible the recurrence of the evils which had overwhelmed the confederation and to provid ; the y of leg- limi- Taft necessary basis of national unity by insuring uniformi regulation against conflicting and discriminating State islation. Again, in the Wisconsin Rate (Mse, where a somewhat lar situation was presented to the Court. Chief Justice declared: ite that for the Interstate business. Congress, as the domlnanlj ~ trollcr of intcrstat* commerce may. therefore, restrain undue tatlon at the earning power of the lnt«r*tat«-0(«uii«re« — ' dotog Stat* work. The affirmative power of Congraea In latOTstate-conuiMrce agencies la dear. no nter- Aet to securing does. Intriatate the nter- eompeni atlon to con- llml- •ystim in developUig In Wallact agalnct CalllsUn Packers Co.. wtaleh dteldid tn Octotor 1933 in ih« PedMlU Olflrlet Cotirt of CftltfornlA. Um coort was rtquirtd to pMt upon ttio rimi ct the Secretary of Agriculture to enjoin a company from pro- ducing peaches in excess of its quota under the A^Jl. The court declared: It must be construed to give the Congress the power to regulate any and all commerce which may seriously affect the Interstate trade This court, with propriety, cannot make the narrow hold- ing that the legislative body, under this analogous statute^ U without power to regulate Intrastate commerce as a proper means S achle^g the dStred regulation of the interstate commerce. S this and other respects the power to regulate must be construed to effectuate the broid purposes of the constitutional grant and of the national policy. So from 1824. when Gibbons against Ogden was decided, to the present day. with the exception of the apparent detour of the Supreme Court in the Child Labor case, the tendency of our Federal tribunals has been to approve congressional extension of powers under the interstate -commerce clause. The stability of Mr. Beck is shattered as he visions a Roosevelt dictatorship since Congress has delegated certain necessary powers to the President under the NJl~A. A dictator subject to a court belies the term, and Mr. Beck believes that Mr. Roosevelt's power will be drastically limited by the Supreme Court. Business in the emergency required a commander in chief. There was a far-flung cry in the business world for leadership, and when the life of the Nation chanced engulfment in the business catastrophe it was the certain duty of the President to accept that leader- ship and of Congress to give him the necessary powers. This delegation was constitutional, for Congress, after clearly stating its objectives, sets forth the principles and general methods by which the President was to achieve them. The legislative body followed its former course in the Tariff Act of 1922 when conferring rating powers on the White House. The various statesmen who lauded that clause in the tariff are highly critical now, and a little hysterical, but the Court is not swung by political considerations and will accept the theory of our Government relations favored by Chief Justice Taft in passing on the Tariff Act of 1922: • • • To avoid such difficulties Congress adopted • • • the method of describing with clearness what Its policy and plan was and then authorizing a member of the executive branch to carry out Its policy and plan and to And the changing difference from time to time and to make the adjustments necessary to con- form the duties to the standard underlying that policy and plan. Aa It was a matter of great Importance, it concluded to give by statute to the President • • • the function of determining the dlfferenoe as It might vary. While it is true that the Lever Act was declared unconsti- tutional although a war-time measure, there the difficulty was lack of precision as to violations. Criminal statutes must be definite. It may be that a particular code could be set aside on this basis, but that would only be charged to a lapsing from the directions set out by Congress in the act, and in itself be a violation of the NJI.A. Perhaps the Court will not be pressed to pass on the fimdamentals of the law, for the signatures to a code could readily be declared waivers of constitutional rights. The licensing provisions may be considered a form of duress and then the waiver value would be nullified, opening for the Court's attention the basic questions. Naturally the waiver theory would not arise if a nonsigner seeks the protection of the judicial branch of Government. The Court can in the pending state of the Nation be both realistic and legalistic. Its own precedents favor, and the country demands, the new deal. The 9 judges are not 9 blinded hermits, stupefied by the dust of an eld courtroom, crying out, "O Temporal O Mores! " They advance with the times along a well-charted constitutional path. The judges will not inconvenience the public if it can be avoided. They will be mindful of the economic eruption that would attend an adverse decision on the NJI.A. It would be in line with declaring the Selective Service Act unconstitu- tional as the American Expeditionary Force was achieving victory. Two recent declarations from the bench are proof of this and are also prophetic of the fate of the N.R.A. Ju0tlc« Brandels brought the Nation sharply to attention with this thoughtful docUu-ation: Th« pMpta of ilM t7nH4Ml BittUt arc now confronted wnii an wmmwnntj mon mrtorn ttas war, Watty it widwpwd, tn a iftn« 1934 CONGRESSIONAL RECORD— HOUSE 241 not of scarcity but of overabundance. The long-continued depres- sion has brought unprecedented unemployment, catastrophic fall in commodity prices, and a volume of («onomlc losses which threatens our financial institutions. • • • There must be power in the States and the Nation to remold, through experi- mentation, our economic practices and institutions to meet changing social and economic needs. Chief Justice Hughes places his finger on the casual effect industrial decline has on commerce when in the AppaUichian Coals case he reminded the country that — When industry is grievously hurt, when producing concerns fall, when unemployment mounts, and communities dependent upon profitable production are prostrated, the wells of commerce go dry. The Congress will not permit these wells to remain dry nor will the people nor the Constitution nor the Supreme Court. [Applause.] Mr. LAMNECK. Mr. Speaker, I ask unanimous consent to address the House for 45 minutes. The SPEAKER pro tempore. Is there objection? There was no objection. Mr. LAMNECK. Mr. Speaker, I rise to address the House in support of the President's policy to restore the 1926 price level and at the same time provide sound money for this Nation. In my opinion, this question transcends in impor- tance all other questions now claiming public attention. Its proper solution will determine whether the depression is to continue or whether we are to have prosperity. We have the economic power to control this situation. How shall we use this power? We have the power; what we need is a clear vision of the truth alMUt it. I am addressing myself particularly to those Members of Congress who are in sympathy with the Piesldent's program to alleviate human suffering, stimulate business, and bring happiness and contentment to all the people. The Presi- dent has been very definite in his pronouncements. There has been no equivocation. His high purposes are under- stood, appreciated, and applauded by the people of the coun- try regardless of politics. He wants the 1926 price level and a dollar that will have the same purchasing power from one generation to another. That is the issue; it is a clean-cut issue. I favor it, and I wish to address myself to those Members of Congress also favoring it and who wish to give the President their support, and who wish to help bring about the high aims set out in this policy. Congress has definite resiwnsibilities in this matter. It represents the constitutional authority of our Government specifically delegated to Congress to coin money and regulate the value thereof. It is the fundamental law of the coimtry. We cannot depart from it. Our Government cannot law- fully function to suit the whims of individuals or any group of individuals, for the power has been given to the Supreme Court of the United States to interpret and enforce the Constitution. Mr. Speaker, we have been in this depression for 4 years. To meet and cure the present distressing conditions Congress has conferred certain extraordinary powers upon two suc- ceeding Presidents. The right of Congress to delegate such authority may be questioned, and that is one matter to which I Vfish to address myself for just a moment. There is such a thing as delegating authority to the Executive in order to strengthen his hand and give to him the necessary power to accomplish the things which are important or impera- tive. There is such a thing, also, as the Congress shirking its responsibility and placing its powers where they cannot be used. On the eve of the World Conference at London it was of the greatest importance that our President should be possessed of particular and extraordinary iwwers that we might give every possible opportunity to the London Confer- ence to work out a price level that would restore prosperity. The London Conference failed to restore a price level that is in the Interest of the United States. It Immediately de- veloped in that Conference that any effort of the United States to raise mice levels was offensively called an " Inflation plan." To raise price levels and at the same time have sound money is the object of the Ooveminent, It Is the Announced policy of this Ooverament; and If ttai^ Is inflfttkn, Uioic uuLvm — M who are opposed wiU have to make the most of It. I claim that a stable price level and an honest price level Is sound money, not inflatiozL And whether I am right in this state- ment, or not right, is one of the matters this Congress can determine. This is the rock on which the London Conference had to split. There was no other result except one, and that was a surrender of our wealth of resources and our future prosperity. The London Conference was a failure, as was predicted in this House of Representatives at the time the resolution was passed authorizing our participation in it. Vahiable time was lost; but we could not oppose this method of deal- ing with this question, because it was forced uvton the Con- gress by the uncontrolled and uncontrollable sentiment which bad swept this country into the conctuslon that an economic conference was the one way out. This conclu- sion was not foimded upon intelligence and not upon reason. Was it founded upon ixtipaganda spread over our country? That is quite a question! But now that the London Conference is a failure, we can come back to the speeches that were made in this House by Representative Fiesinger. of Ohio, Representative Amile. of Wisconsin, and by others, pointing out the reasons why the conflict of interests between Europe and America in the matter of price levels could never be adjusted m a conference, and also pointing out that American protection could only be arrived at by independent American action. And now, the most important question twfore the Con- gress, the Nation, and the world is to take up where the London Conference left off and to succeed where* the London Conference failed in restoring the 1926 price level and at the same time provide this Natlcm and the world with sound money. Mr. Speaker, we have not had sound money In the United States since October 1929. The purchasing power of our money has either been rapidly rising or rapidly falling. In both instances profltable world markets have been closed to us because of this condition. Our customers who used to purchase from our surplus of production can no longer finance their purchases, and we. as a result, are afflicted with what is caUed " overproduction." To restore our com- merce and to restore our markets and be able to sell at a profit are primary steps toward curing this depression. Fur- thermore, it is a fundamental step; It deals with causes rather than results. All the legislation and all the activi- ties of this Government during these past 4 years have been dealing with effects. They have represented an effort to distribute the burdens of depression rather than to ctuie the cause of the depression. We have placed 4.000,000 men on the pay roll of the Government, but the Oovemment has no profits from which to pay these men. It must pay them from taxes and from borrowed money. We must relieve the taxpayers of the burden of maintaining millions of' persons who are on nonproductive pay rolls or it will surely destroy this Government. We must restore profits, and we must restore them quickly. To restore profits we must remove the cause of depression and bring back those conditions upon which prosperity must be based. You cannot have depression in a country of the natural wealth of the United States if you have free commerce In the world and a soimd money system. There Is no sound- ness in the money system where the money base has fhictu- ating value. Sound mooef impbes stable price lerds. Any one or any two or a dozen commodities may fhjctuate tn value^ owing to overproduction or other conditions, but the whole list of commodities cannot be in a dump without proving that something has happened to your money base. Gentlemen, we are facing the most critical period in our history, because we have not deaSt with this question in Its fundamental aspect during these 4 years. Nations aD over the woild are leaminf to produce what we used to produce for them. 0pain can frow her wheat. Asia and Africa can grow cotton; tlie rrmeti flhtf Is leaminf to make paetries out of AtwnUm wiMil; Um logUilNMa li Imntim W aakc 242 CONGRESSIONA RECORD— HOUSE January 8 bread out of Argentine flour with equal success to American flour: and Buropc is showing that a preference for Chicago beef is passing to Argentine beef. I Mr. Speaker, we have delayed too long in intrusting ^e management of our money system to experts who are tcnk- porarily serving our Government and who are permanenuly employed, in the main, by the very interests that hare opposed us in our efforts. Price levels cannot be controlled by the banking interests of the world and also by the United States Congress. One or the other must assume control. The experts of the ban i- ing interests have been advising our Government. Con- gress alone seems to be able to secure experts who aire divorced from these opposing interests. Three months ago, at a conference in the Treasury Department, one of the chief advisers of the Treasury made the statement that | if this Government resorted to a certain action he would forced to resign his position. How can a government f tion when its advisers are ready to go on strike unless thiir particular views are carried into effect? How can we. set- ting in this Congress, know that one ofBcial who threat to resign is not in harmony of thought with many otheife? How can we know that the officials of our Government are not threatening to strike, and other forms of duress, if the policies of the Government refuse to conform to the iny. THZ ncsnvGCH Bnx There is a bill pending in this Congress which was pend- ing at the time of the resolution relating to the London Conference. This bill is a second declaration of independ- ence as applied lo our economic life. It recognizes geld as the measurement of value. It puts the control of pri ce level in the hands of the Government instead of in tie hands of the international bankers, as it now is. It plac es the United States in control of its money system for tie first time in the past 100 years and takes it out of tie control of the hands of the European nations. It gives sil\ er a monetary use. In effect, it doubles the supply of gold of the world. It prevents the manipulations of gold values. It restores the purchasing iwwer of sJl nations now on a silver basis, and gives to them a world money. If these statements are true, who is there that coild oppose such a piece of legislation? This bill was sidetracked in order that the London Con- ference might be given the opportunity to show what could do. We have all seen what it could do — it could f nish a beautiful trap for the United States to walk We were saved from going into this trap, not by the acupn of our London delegates at the London Conference. Tney were pr^;iared — and perfectly willing — to walk into this tn ip. I myself had a conference with Governor Coz. the chief n p- resentative of the American Government at this Conf eren ce, a few days before he left for London. I went to this Conference with Representative Fiesinger, my colleague from Ohio, and Mr. John Janney, our mo- nomic adviser, at the request at President Roosevelt. We were in conference on the 24th day of May, and I was t>ld by Governor Cox that " the program for the London C( n- ference was not only fully arranged, but it was all agracked and is being promoted by a well-organized and strongly financed minority, while the large majority of the people who do. and should, oppose it are imorganized. The treaty should be given no further consideration imtil an official economic survey has been made by a competent unbiased United States commission and it can be proved beyond doubt that there will be adequate return on the gigantic investment that would be required. It is interesting to consider what are the principal factors, communities, and individuals which favor and advocate the St. Lawrence canalization and what benefits will accrue or may accrue to these factors and to the remainder of tha United States. For many years there has been maintained in the city of Washington an organization whose only duty has been to work for and advocate the canalization of the St. Law- rence River. This is the Great Lakes-St. Lawrence Tide- water Association. This association has been maintained by legislative appropriations and donations from lesser or- ganizations in, according to its own statements, 23 States, extending from Ohio even to the State of Washington on the Pacific coast. A large part of the propaganda which has been put out by the said association has consistently stated that this canalization would reduce the cost to American farmers of exporting grain, thereby increasing the Income to the fanner and increasing the value of his holdii^s. Definite active effort to secure this canalisation was started shortly after the war. while Mr. Hoover was Secretary of Commerce, and the basis of the then argument was that the railroads had been, and would be in a few years, incimable of handling the traffic to the seaboard from the interior of the United States; that congestion of trafflyc would thereby be relieved and freight rates reduced. Thirteen years after those prog- noBticatione the traffic conditions, as assumed, are reversed, and the railroads are begging for enough freight to pay oper- ating expoMQB. These various States which have supported the said "nde- water Association consist of what may be called the north - central portion of the United States, and they have been toW many times about how much they would be improved commercially and economically by the canalization of the St. Lawrence, often being told that it would save 10 cents per bushel on their grain freight rates. Believing in this propaganda, they have supported this association with their funds. It will be remembered that a few years ago there was a tremendous flood in the Mississippi Valley and that some lives were lost; that there was much suffering and destruc- tion of property. Following that catastrophe, funds were provided by the Federal Government for research and en- gineeriRg; following this, many millions of dollars were appropriated, and work is now progressing upon plans not only to mitigate further flood damage but also to provide water transportation on the Mississippi River and its main tributaries, including the Missouri, Ohio, and Illinois Rivers. L«t us now study the St. Lawrencp proposition in con- junction with the Mississippi-Ohio-Missouri work, and also in connection with the grain production and movement of oitr northerly neighbors. Beginning in the southerly portion of the proponent area, wf.' will take the wheat-growing .State of Klansas — the great- est wheat -growing State in the Union— and find that the center of this State is practically the same distance in a straight line from the Great Lakes at Chicago that it is from the ocean at f^ew Orleans, but that it is much nearer to the Missouri and the Mississippi Rivers than to either of these ports. If the people in the Mississippi Valley really believe that the improvement of that stream for navigation would be of material benefit to them, to the extent of a large portion of the cost of its improvement, why should they be so interested in the canalization of a river in the northeasterly portion of the United States which in order to reach they must cross the other improved waterway; moreover, what benefit can accrue to the farmer of Kansas when the cost of shipping a bushel of his grain to the nearest Great Lakes port is greater from 30 to 60 percent than it is for the farmer in any of the Northwest Provinces of Canada which lie east of the Rocky Mountains? Now let us see what great benefit can accrue to our people in the Dakotas and Montana from the canalization of the St. Lawrence. Certainly they, like the others, cannot expect the canalization of the St. Lawrence to make it cheaper to get their grain to our Atlantic seaboard. Therefore they must have been sold upon the idea of export grain and its infiuence upon other grain sales. Maj. Theron M. Ripley, Buffalo, N.Y., an outstanding American engineer, who has made a life study of water suw)ly and power, canals and drainage, makes the following statement: A comparlfion of the rates from these States to Duiuth wtth those In the Provinces of Manitoba, Saskatchewan, and Alberta to Port Arthur, from which points the rates east are the same, shows that from neither of the Dakotas can grain reach Duluth for as smaU a rate as from many points In the Province of Manitoba exeepting along the easterly border of North Dakota; and that an average rate for each of these States Is as large or larger than the rates for the entire wheat-growing area of Saskatchewan and that they are In competition even with wheat grown in Canada under the ahadow at the Rocky Mountains. Although the center of Montana is 330 miles nearer to Duluth than the center of the wheat-growing area of the Province of Alberta to Port Arthur, nevertheless the rate between the first two places Is 50 percent greater than between the latter In other words, the wheat reaching the ports of the Great Lakes from the large wheat-growing areas In the United States is already at a dlsadvanUge with our neighbors to the north to the extent of 5 to 15 cent* a bushel before it Is loaded upon a lake steamer. How do the proponents of this waterway Improvement expect this dif- ference to be overcome by Improving the St. Lawrence? The preceding statements are important enough to be em- phasized. In 1930 a revised report was put out by the United States Corps of Engineers and the Bureau of Opera- tions of the Shipping Board, and contains the following: It is well known that a saving of as little as one fourth of a cent per bushel will serve to divert substanUal movements of grain. Indeed, the situation is such that the grain shippers must oonstantly be alert, not only with resjiect to the actual rates tfver the various routes but also the conditions affecting the prompt- ness of movement, the situation at the terminal elevators, etc. The proponents for the St. Lawrence canalization have re- peatedly stated that it would save 10 cents a bushel on export grain, but they have never told how this can be done when grain is being shipped from Duluth or Port Arthur to Montreal for 5 cents or to New York City for 6 cents; nor how this amount can be saved when the entire cost from the upper Lakes to Liverpool is less than 12 cents per bushel. Neither have they told their constituents, who are a few himdred miles from the Lakes and where most of the grain is grown, that they were handicapped before reaching lake iwrts. It is realized that com and oats are produced in the United States in greater volume than wheat. In the United States in 1928 there was produced three times as many bushels of com as of wheat, but a large proportion of the former reaches the consumer in the form of meat, while the latter still contains its identity in the loaf of bread. For this rea- son wheat is used as a basis of comparison for export as well as for transportation over long distances in the United States. It is a well-known fact that the great prairie Provinces of Canada, viz, Manitoba. Saskatchewan, and Alberta, are primarily grain -growing areas; also that our Mid West and Central Northwest are foremost in this production. Neg- lecting the recent hectic years let us study the decade from 1919 to 1928 to get an idea of what happened in wheat production. In 1919 there was produced in the United States 934,265,000 bushels of wheat and in Canada 193,260,000 bushels of wheat. In 1928 there was produced in the United States 902,749,000 bushels and in Canada 566,726,000 bushels. While the United States showed a decrease of about 28,000.000 bushels, equal to about 3 percent. Canada showed an increase of 373,000.000 bushels, or about 200 per- cent. Of this Canadian total, 96.1 percent was produced in the three above-mentioned Provinces. If the United States, with a population of 120,000,000, has a surplus with a production of 902.000,000 bushels, how much more of a surplus must Canada have with a population of 11,000,000 and a 556,000.000-bushel production? In 1928 the 3 mentioned Provinces of Canada produced 544,598,000 bushels of wheat, and the 16 States from Ohio to Idaho produced 664,920,000 bushels. Of this latter amount but 12 V2 percent could reach Lake ports with rates equal to those from Manitoba, and only about 40 percent of this total production can reach the Great Lakes with a rate as low as the grain from any of the above-named Canadian Provinces. In view of the foregoing facts relative to the transporta- tion rates to the Great Lakes, would It not be advisable for those who are personally interested in protecting and enlarging the market for the Middle West farmer, to make a careful study not of Lake rates but of rail rates to the Lakes? Would it not be well to ascertain why it is that his Canadian neighbors can have their grain carried 1.250 miles for 15.6 cents a bushel, while he must pay 23.7 cents a bushel to have it carried 930 miles; or why his Canadian neighbor can have his wheat carried to Lake Superior, a thousand miles distant, for 14.4 cents a bushel, and he must pay the same amount of money per bushel for a carriage of 344 miles? As a partial answer to the foregoing questions, attention is called to the following quotations from Senate Document No. 107, Seventieth Congress, first session, which was printed under date of March 15, 1928 (these rates are in force January 1934). The rates on grain for export from the western Canadian Provinces to Canadian Atlantic and Pacific ports are lower than the corresponding rates for export from the northwestern part of the United States to American Atlantic and Pacific porta. These rate differences • • • appear to be due directly • • • %o certain charter provisions of the Canadian Pacific RaUway. That railway was. In 1897, granted a charter to build a line from Xiethbrldge. Canada, through the Crowsnest Pass Into British Columbia, and was given a subsidy of tS .600.000 and a land grant. In retiun It agreed * * * to reduce the then existing rates from the western Canadian Provinces to Lake Superior porta by 3 cents per 100 pounds, and to maintain such reduced rates In perpetuity unless otherwise authorised by the Canadian Govern- ment. The three western Provinces of Manit<4Mi, Saskatchewan, and Alberta produce 96 percent of all Canadian grain pro- duction. We quote again: The rail policies of Canada and the United States are somewhat different. In this country there Is private ownership and manage- ment of common carriers, and such carriers are wholly dependent upon revenue derived by them from transportation. Practically all the raUroads mileage In Canada Is owned by two systems, the Canadian National and the Canadian Pacific. The former em- braces most of the weaker and high-cost lines and la owned by the Government of Canada. In 1925 the Canadian National failed to earn enoug^h to pay interest on its debt by $42,197,804. and in 1926 failed to earn its interest by $29304.072 • * *. These flgxires do not refiect In fuU the extent to which the Canadian National failed to earn its operating expenses and a reasonable return upon Its Investment, as the deficits shown do not cover such part of the Investment In the Canadian National, which la represented by any other form of capital than Interest-bearing debt. The Canadian Pacific is thus in a position to charge lower rates than would be possible If rates were made in Canada as they are In this country, with a view to providing a fair return upon the aggregate value of aU railroad properly including the weak lines as well as the strong. In 1931 the deficit of the Canadian National Railway was in excess of $84,000,000. In other words, the people of Can- ada paid over $1,600,000 a week, in taxes, in order to operate their railroad. Computed on a per mile-of-road basis, railway tax accruals tn Canada In 1926 were approximately $267 per mile and In the United States, $1,591 per mile. If the tax accruals In the United States were on the same basis per mile of railroad as In Canada, they would have been approximately $330,000,000 less. If relief is to be given to grain growers of our Middle West and Northwest, in order to put them on a parity for export with our Canadian neighbors, the foregoing facts demonstrate that a subsidy should be paid to the railway carriers, large enough to permit them to lower the rates on grain to the lake ports or the seaboard in parity with their competitors to the north. Such a subsidy would not only benefit the farmers but permit the railroads to maintain theh: equipment, retain their employees, and prevent many of the security holders from going bankrupt. In 1931 the Court of Chancery of the State of New York wrote: Railroads are public Improvements from which the public de- rives a benefit, and the legislature can appropriate the private property of an Individual for the purpose of such Improvements, or may authorize an individual or a corporation to thvis »,pptO' prlate It upon paying the jiut compensation to the owner for the same. This quotation is one of the bases upon which Chancellor Walworth based an opinion relative to the right of a railroad corporation to take private property. Attention is called particularly to the first part of this quotation: "Railroads are public improvements. . . ." If the lawmakers can Justify themselves in creating statutes which will turn over public money to farmers or any other private indlviduala. how much more would they be justified in turning over public moneys to a corporation operating a " public improvement." It would be much better to give the grain grower a chance for equal competition than to hand him a dole of a few dollars, and then take part of it away frwn him in taxes to pay for waterway im- provements which would not help him and for which no proof of their economic justification has been confirmed. lliis and fiction, theory and condition, hope and belief are at present so thoroughly mixed in general discussions of the proposed canalization that a thorough unscrambling must be made before any step, which cannot be retraced. It taken. I have endeavored to place these facts before you. so that when the details of the project are submitted to the Mem- bers of the Senate you may be able to render them your verdict in the dispassionate light of fact and reason. 5 I I? { 246 CONGRESSIONAL THE STTGAR nfimST«Y tW THE PHILIPPIHE XSLAKIW Mr. GUEVARA. Mr. Speaker. I ask unanimous consent to extend in the Record a statement regarding the sugar indus- try of the Philippines, prepared at my request by the Honor- able Rafael Alunan. president of the Philippine Sugar Asso- ciation and formerly secretary of agricultural and natural resources and secretary of finance of the Government of the Philippine Islands. The SPEAKER pro tempore. Is there objection? There was no objection. Mr. GUEVARA. Mr. Speaker, under leave to extend my remarks in the Record. I include the following statement re- garding the sugar industry of the Philippines prepared by Hon. Rafael Aliman, president of the Philippine Sugar Asso- ciation and formerly secretary of agricultural and natural resources and secretary of finance of the government of the Philippine Islands: 6ta7£Ment or Hoic. Rat ail Ajlunan Rxi^tive to the Sucab In- DcsTBT or Tirs Phxuppincs PKIOB TO AMnUCAM OCCUPATION Long before America went to the Philippine Islands, the sugar Indxistry was In a highly drreloped state. PhUlppine sugar being able then to compete In the world's markets. In 1855 the Philip pines exported 53.172 short tons of sugar. By 1875 the sugar ex ports of the Islands had increased to 141,218 short tons, and In 1895 the Philippines reached Its record of sugar exportation under the Spanish regime, exporting 376.401 short tons of sugar that year, a figure which was not exceeded until 1922. During the 6 years of warfare caused by the Philippine revolu tlon in 1886 and the conflict with the United States lasting vmtil 1902. the sugar industry was ruined and paralTzed to such an ex- tent that for over 10 years after American occupation sugar ex- ports of the Ulands decreased to negligible quantities. raST 10 TKABS UNDCB AMBUCAH SOVXU30MTT In the Treaty of Paris, providing for the cession of the Philippine Islands by Spain to the United States, the following provision was included : "Article IV. The United States will, for the term of 10 years from the date of the exchange of the ratifications of the present treaty, admit Spanish ships and merchandise to the ports of the Philippine Islands on the same terms as ships and merchandise of the United States." In view of this provision of the treaty, free trade between the United States and the Philippines could not be established until the expiration of the 10-year period provided for in said treaty. However, in view of the appalling condition of the sugar in dustry of the islands as a resxilt of the ravages of war and revo- lution. In response to the pleas of the American Civil Governor •nd American members of the Philippine Commission, Congress passed, on March 8. 1902. the Philippine Tariff Act. providing, among other things, that articles tt^t were the growth and product of the Philippine archipelago going into the United States were given a reduction of 25 percent of the rates of duties Im poaed by the United States under the Dingley TarlH Act of 1897. TSAOX WTTH THC UITITKD STATSS On Atigust 5, 1909. Congress passed the Payne-Aldrlch tariff law CBtabUahlng frse tnule with the Philippine Islands and allowing sugar free entry Into the United States to the extent of 300.000 tons. During the consideration by Congress of this legislation, propos- ing free-trade relationship between the Philippines and the United States, the Philippine i>eople opposed the adoption of this measure, a^tt Uirough their Philippine Assembly, on March 27. 1909. adopted a Joint reaolutton petitioning Congress not to establish free trade on the ground that, in the words of the petition. " • • • Free trade between the United States and the Islands would In the tature become highly prejudicial to the economic interests of the Philippine people and would brizig about a sltua.tlon which might binder the attainment of the Independence of the said people." It 18 pertinent to record here the -statement of the venerable former Senator Kllhu Root, who, when addressing the Senate on this subject In connection with the passage of the Payae-Aldrlch bUl In 1009. eatahltshlng free trade with the Philippine Islands, expressed the Republican Party's viewpoint In the following words " Mr. President, we have some duties to the Filipinos. I am SOTS no Member of this body really desires to bring sJx>ut a separation between the Philippine Islands and the United Statei by T»i»inr>g our administration of the government of those islands a failure, by making the guardianship of the United States the cause of injury rather than a benefit, the cause of disaster and poverty rather than of prosperity and growth. ** The die la cast. Mr. President, upon which we have the re q>onslblllty for the Philippine Islands. No action of ours can reverse It. The good faith, the good name, the honor of the American people are all pledged to lead the people of the islands on by paths of growli\g prosperity and capacity for government to the point where they will be capable of supporting and governing themselves. "We cannot fulfill that high duty by giving them money * * * Gifts at mcmey tend to reduce the Independence of RECORD— HOUSE January 8 the Individual character. We cannot fulfill the duty of making the* islands stuxeasful in business, by retarding and confining their industry. We can fulfill it only by giving to them the opportimities to national power, to grow in the accumulation of property and the diffusion of wealth, lying at the foundation of civilization. We can fulfill that duty by making the people of the Philippines at once prosperous and intelligent." In 1913. when the Democratic Party came into jxjwer. Congress enacted the Underwood -Simmons tariff law on October 6, which removed the restrictive provisions of the previous law of 1909 with respect to sugar and tobacco. Congressman Underwood. who sponsored the bill, explaining the removal of these restric- tions on the floor of the House, stated as follows: "The change in this paragraph of the biU is largely striking out the limitation on the importation of sugar, filler and cigar tobacco, and wrapper tobacco. We may leave the limit where it Is. but we would leave it where it is to the shame of every American citizen. We could not honestly face those dependent people who give us free trade In their markets if we close our doors here. Because we do not want to stand and face that world In such a position as that and say (to the Filipinos) that under our law we command you to open the door, so that American goods can flow into your country, because we have the power to do It, and then turn around and say to them that on the only thing they can Import, practically, into our country and make a market for. we. will close our doors and prevent them developin'; their trade. I say that no true-born American citizen who faces this question fairly and squarely and understands the situation will consent to that." That statement of Congressman Underwood has since been the guiding policy followed by Congress in dealing with Philippine products coming into this country. The establishment of free trade had the Immediate effect of attracting American capital into the islands for the development of the sugar industry. In 1910 a group of Americans obtained concessions in the Island of Mindoro. a heretofore undeveloped, uninhabited property, and constructed the first modern centrifu- gal sugar factory in the Philippine Islands. Two years later two other American companies established sugar centrals at Calamba, on the Island of Luzon, and at San Carlos, on the Island of Negroe. Thus, the modern develc^ment of the sugar Industry was Ini- tiated by pioneering American business men and American capi- tal, tfx it took a decade to convliu;e the Philippine farmers of the advantages of improving their sugar production and manu- facture along modern methods, and not until 1918-21 were the Filipino producers convinced of the necessity of modernizing their methods of manufacttire and begtm to establish six so-called " bank centrals " with the financial aid of the Philippine National Bank. The result of this change, the replacement of these thousands of primitive. Inefficient, wooden cafabao mills by modern centrals and factories, together with the recent Improvement in methods of cultivation and planting of higher-yielding cane varieties, sugar production in the Philippines in the past two decades has nat- urally doubled and trebled as has happened In Cuba, Hawaii. Puerto Rico. Java. Formosa, and other sugarcane producing countries when those countries changed their methods of manu- factiu-e from the antiquated nxllls to the modem factories. For it Is a well-known fact that the wooden carabao mills then in vogue In the Islands could only extract 30 or 40 percent of the sugar content of the cane while the modern sugar central factory re- covers as much as 92 to 95 percent of the sugar in the cane. Had the cane harvested in 1895. whi^h turned out a production of ♦31.000 short tons, been milled by the modem centrals now established in the Islands, the result would have been a produc- tion of about 1.100.000 short tons. For the 6-year period. 1902-3 to 1906-7, Cuba produced an average of 1.300.000 tons. Ten years later, from 1912-13 to 1918-17, Cuba almost trebled its production to 3.100,000 short tons. Puerto Rico, for the 5-year period. 1897-1901. produced annually an average of 69.000 short tons. Five years later. 1902-6. it more than doubled Its production to an annual average of 155.000 short tons, and stUl 5 years later, from 1907 to 1911 It quadrupled its production to an annual average of 285.000 short tons. Hawaii had an average production for the 5-year period 1895-99 of 227.000 short tons. The following 5 yeais. from 1900-1904. its production increased to 362.000 short tons, or an Increase of 80 percent, and for the next 6 years, from 1905 to 1909 Hawaii had an average production of 470.000 short tcms, or more than double Its production of the past 10 years. The modernization of the sugar Industry of the islands, which has taken place in the past 2 decades, has now been completed with the establishment of 44 modern sugar factories, with a nor- mal productive capacity of 1,400.000 short tons, in the districts where formerly thousands of antiquated muscovado mills were in operation for centuries. There has been very little Increase In the acreaf^e for sugar- cane in the Philippines since the Spanish regime. In 1895. when the Philippines produced Its record production of 431.000 short tons, there was planted to sugarcane that year at least 500.000 acres of land, as compared with 506,000 acres planted In 1921. and 633.000 in 1931. As a matter of fact the recent Increase in producUon was mainly due to Increased yields resulting from the substitution of the old native cane with new higher-yielding cane varieties. 1934 CONGRESSIONAL RECORD— HOUSE 247 irracT or the amexican xARtrr By virtue of the free-trade relationship which exists between the Philippines apd the United States, practically all of the Philip- pine sugar exported abroad goes to the United States where it enjoys a preferential-tariff immunity of 2 cents per |>ound, as compared with Cuban sitgar. and 2.6 cents per pound, as cam- pared with foreign sugar. With the tariff preference Philippine sugar can compete with Cuban sugar and other foreign sugars in the American market. If subjected to a tariff of 2.5 cents (or even 2 cents) gold per pound, Philippine sugar could not be mar- keted in the United States at the present time. The Philippine sugar industry has thvis been developed within highly protective tariff walls both at the market in the United States and at the place of production In the Philippines, with the result that the industry cannot survive world's comi>etltion If the American tariff protection is withdrawn. POLrnCAL, SOCIAL, AND ECONOMIC KFTECTS Being the most Important Industry, sugar has brought to the people of the islands Immense benefits affecting their social, eco- nomic, and political life. These benefits may be summarized as follows : (1) With the Investment of approximately $250,000,000 the country has increased its wealth-producing capacity. This in- vestment turns out an annual production of sugar valued at approximately $75,000,000, which is approximately 40 percent of the total value of all agricultural products of the Philippine Islands, including rice and other food products. The Investment In this Industry Is controlled by Filipino and American investors. Part of the Investment made by the Filipinos was borrowed from their national bank, with encouragement from American officials. Very little of the capital may be called foreign capital. The total aggregate Investments In the Philippine sugar industry amount to $251,512,535, as follows: Investments in centrals $84,012,535 Investments in lands 140,000,000 Crop loans 22.600.000 Miscellaneous Investments 5.000.000 Total 251, 512. 535 Of the total of $84,012,535 Invested in centrals. 40 percent is American Investment. 37 percent Filipino, 22 percent Spanish, and 1 percent cosmopolitan, as shown in the following table: (5) The sugar Industry Is the main suMMrt of the Philippine Government. For every dollar of valiie of sugar prodwed in the VhlUpplnes the Philippine Oovemasent derives in sales tax and othM- taxes apinroslmatsiy ao cents. The vwtum of 1.2aS4>00 short tons produced for the past crop atgregttem $75,000,000. from whleli the Philippine Qovemment will derlvs a revenue of $15,000,000. The income of the Philippine Oovemment for 1933 Is estimated at $24,000,000. BO that It derives 60 percent of its revenue from the EXigar industry. (6) In 1932 the value of sugar exported from the Philippine Islands constituted 63 percent of the total value of all their exports, as may be seen from the following table: Value of principtU exports from the Philippines /or th€ ealendar year 1932 Nationality Number of centrals Total in- vestments Percent- age of totol in- vestments j\ mM^knui ... -- - - 12 «3. 815, 860 40 21' : 31, 127,894 | 37 9 3 18, 27fi. 574 792,417 22 Others . 1 Total 45 84, 012. 535 100 The Investment classified as Spanish includes investments made by two of the oldest established companies In the Islands — one established 75 years ago and the other more than 50 years ago — so that It is generally considered In the Philippine Islands that these are Philippine Investments. Moreover, many of the holders of the stock of the centrals classified as Spanish are in fact Filipinos. ^ , ,^ Of the 45 centrals in the Philippine Islands, approximately 24, or more than one half of them, are small mills, with capacities ranging from 150 to 750 tons of cane per day. Most of these mills are financed by a group of Filipinos, while a few others were established by cosmopolitan Investors, including Filipinos, Ameri- cans, and others. No Chinese are financially interested in the mills. Practically all the lands devoted to the ctiltlvatlon of sugarcane In the Philippines are tilled by Filipinos. Filipinos engaged in sugar cultivation In the PhUlppines, including their families, number 2,000,000. Unlike other sugar-producing countries, which must rely on foreign labor to grow sugar, the Philippines depends solely upon native labor for Its production of sugar. It Is to be noted in this connection that, considering the social value of the sugar industry, the Philippines can claim that all of the benefits accruing to the people who grow the cane goes to 100-percent Filipino labor, owing aUeglance to the United States, a record which cannot very well be matched by other sugar-producing countries supplying sugar to the United States. „,v^««« (2) Of the 48 provinces, 17, with a population of over 7,000,000 people, or more than half of the total population of the islands, are directly or Indirectly dependent upon the sugar industry. At least 2.000,000 farmers, laborers, and their families depend for their livelihood upon the growing of sugarcane. (3) The sugar industry more than any other industry in the Islands has been responsible for uplifting the standard of living of the Filipino people. Recognized authorities place the stand- ard of living of the Filipino people 300 percent above that of the peoples of their neighboring countries. (4) The money sf)ent by the centrals and the planters for the purchase of supplies and materials required by the sugar industry amounts annually to approximately $30,000,000, or over 60 per- cent of the total money in circvilation in the islands. To all oountrias To United States Value Percent Value Percent 1. Sugar and l)y-products tm. 350. 000 15,45.'>.000 0,309.000 5. OT.V 000 3, 2f.7. 000 835.000 561.000 244.000 2,514.600 63 31 lfi.21 6.71 6.t)5 3.42 .87 .62 .28 2.84 iao.i4.vooo 12, 063, 000 3. 243. 000 i,Ma.ooo 3. 2.W. 000 173.000 435,000 244,000 1.200.000 00.64 2. Coconut.^ anrt manufactures of 3. Tobacco and manufactures of 4. Manib hemp and manolscturesoi.. 5. Embroideries 0. Lumber and timber 7. UaU - 78.05 SA68 33.35 m 53 20 74 73 71 8. Pearl buttons ..... 100 00 B. Other ex Dorts . ... 47. 7» ' Totrt 95, sag, 000 100.00 tt, 848. 000 88. as (7) The success of the cooperative system which has charac- terized the production of sugar in the Philippines has made the people realise the advantages of cooperative efforts among small producers and farmers. In other words, the sugar industry of ths Philippines has become a model for a modem scientific develop- ment of their other agricultural Industries. AMSBICAlf-PBUJPPtNS TSADE Since the Uirited States took over the Phil«pplne Islands In 1809, America's trade with the Philippines has Increased 40 times, from a litUe over $5,000,000 in 1809 to over $200.000XKX) in 1920. United States sales to the Philippines since American occupation have increased 91 times, from $1,350,000 in 1899 to $92,600,000 in 1939. On the other hand. United States purchases from the PhUlppines increased 32 times, from $3,935,000 In 1809 to $1M,- 465.000 in 1929. These figures show a most significant fact; that U, that the purchasing power of the Philippine people for the products of American farms and industries have increased at a relatively greater rate than their sales to the United States. Under the free-trade relationship between the United States and the Philippines. American exporters have practically a monopoly of the Philippine market. In other words, 97 percent of American products entering the Philippines are protected by the Philippine tariff. This monopoly of American exports to the Philippine mar- ket has been strengthened recently by the Philippine Legislature passing six amendments to the Philippine tariff law increasing the advantages of American products in that market. Today the Philippines is the best market for American cotton goods, dairy products, canned sardines, and galvanised Iron sheets. As sugar constitutes 63 percent of the total value of all exports of the islands, the purchases of the islands from the United States are mainly paid for by the sugar exported to this coimtry. INCBEASINC POPXTLATIOW When the United States went to the islands, the Philippines had but a population of around 7,000,000. However, after 35 years of American guidance, during which time we have improved our sani- tary service, oxir population has doubled until it is now approxi- mately 14.000,000. The Filipinos are becoming mcwe and mere Americanized in tastes and in hablU, so that if their progress continues, it is reasonable to expect that in 10 or 20 years from now our population will have Increased to 20,000,000 or 30,000,000 people, all of whom will have acquired the American ways of liv- ing, and who wUl constitute probably the best customers of America in the world. Recognized experts claim that the Philip- pines, properly developed, can support a population of from 60.- 000,000 to 70,000,000, or approximately half the Inhabitants of the United States. UMiTATioN or rnxumm jmposts xwto the umitbu stath The foregoing facts and data demonstrate the absolute de- pendency of Philippine sugar upon its free entry Into the United States. They also demonstrate the truth that the political, eco- nomic, and social life of the FlUplno people mainly depend upon the status of the sugar Industry, which supports the PhUlppine government to the extent of 60 percent of its revenue. Recognizing, however, the overproduction of sufar the world over which brought about the present depression In the sugar industry, and appreciating the feelings of the domestic sugar pro- ducers here toward an unlimited expansion of the Philippine sugar industry, the sugar producers of the PhiUpplna Islands are ready to cooperate and assist In the stabilization of the sugar industry either through a llmlUtlon of PhUlppine sugar imports to thia cotmtry. besed on the past year's imports, or through a quota sys- tem, snch as provided for in the proposed marketing agreement. i /^rvxTr»r>-nooT/^XT a t DTTT'rx'DT^ TJnTTCT? Taxtttatjv Q ^ ^\ i^ M AJA 248 CONGRESSIONAI, RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE 249 •CTecd to by the prodtieen of the arwa sufiplylng sugar to thi United State*. , This and other similar adjustments or balancing at the benefit i derived from the economic relationship between the United States and the Philippines will. In my humble opinion, bring about n barmoQlouB and mutually advantageous economic Intercourse be^ tween the two countries. Mr. YOUNG. Mr. Speaker. I ask unanimous consent t^ address the House for 3 minutes. The SPEAKER pro tempore. Is there objection? There was no objection. Mr. YOUNG. Mr. Speaker. Andrew Jackson's victory a; New Orleans was won 119 3rears ago today — January 8, 1815. He was the son of penniless Irish immigrants, bom 2 year > after they landed in North Carolina. Nowadays we are men i exclusive. Under the strict immigration laws of today tha Irish couple would be considered undesirable aliens an< Andrew Jackson would never have seen the light of day in America. He was bom on the frontier — ^in the forest field of God — In a humble log cabin — One window shuts out the snow and storm. Oxte window greets the day. Old Hickory was a great soldier. His victory »t Ne\^ Orleans is one of the most remarkable battles in historji Ttie English army outnumbered Jackson's forces. Thu American losses were 13. In half an hour the English had lost 2.900 men, including their commander, Sir Edward Pakenham. a bfothcr-in-law of the Duke of Wellington. As a soldier he saved a vast territory for his country. A i a Democrat, he smashed the Second United States Bank an^ ended a dangerous monopoly. As President, he defeated th South Carolina nullification ordinance. As President, whe Ftance, then as now. a government of crooks and defaulte repudiated her Just debt to the American people, be pro; that American warshlijs seize French ships by force on thi high aetLS and credit the prize money to her accoimt, Prance, of course, paid her debt, because Andrew Jacksoii was stem and unyielding in his determination to serve th< American people and maintain the dignity of America and because he was jright. He was a soldier. Congressman, Senator from two different States, Judge, President of the United States. implacabU champion of the dignity and honor of his country, and pre- server of the Union. He never turned his back to a friem nor his face fnun a foe. He was the idol at the commoi people. His spirit still lives and goes marching on. [Ap- plause.] Mr. FIBSINGER. Mx. Speaker. I ask unanimous consen to address the House for 40 minutes. The SPEAKER pro tempore. Is there objection to the re- quest of the gentleman from Ohio [Mr. PiBsiH«n]? There was no objection. Mr. FUSSINOER. Mr. Speaker. I Ustened with grea interest to my distinguished colleague from Ohio, Mr. Lam hvck: and I also listened intently to the distinguished gen tteman from Maryland, Mr. GoLDSBoaoucR, who spoki! Immediately after the opening of the session today. I wan impressed with at least two things which the gentlemai. from Maryland said. You will recall the gentleman spokti about Profe8sjrrr\'QT\ WATTST^. January 8 •« rvrt i /^/-WT/^T»T7IC«riT/^VT A T T» T7« i-i ^^ -T* T-V TTrXTTOTn on 250 g CONGRESSIONAlL RECORD— HOUSE Mr. Speaker, wiU the genUeman yi(M January 8 res Mr. McPADDEN further? Mr. PIESINGER. Certainly. Mr. McFADDEN. It is evident from the situation now exists in regard to the purchase of gold and the cha^e of value of the gold doUar that this country must and inevitably go back to a gold basis. Mr. PIESINGER. Absolutely. That is what this bill pro- vides—a way to do. We can go back on the gold basis ajnd at the same time provide American machinery for holdjng gold at the 1926 price level. For the benefit of those Members who came to the Seve third Congress and were not Members of the Seventy-sec^d Congress, permit me to say that in the Seventy-second C^n gress the Committee of Coinage, Weights, and Meas made an exhaustive study of the so-called " money questl I was a member of the committee and of the subcommi and devoted a great deal of my time to the study of that question. The committee made a study covering several months. Many witnesses were called in. not a few of whom bore very dtetingiiished names because of their activltiefl[ in economics, commerce, and finance. This study was more from the « orld viewpoint, to see what bearing, if the legislative enactments and monetary policies of countries had upon our domestic economy. We studied question of the sufBclency of the gold supply, the ca the erratic movements in gold, its rarlflcatlon. the of world commerce and domestic trade, the disease of employment, underconsumption, and lack of pure! power. In short, we ran the whole gamut to find oui possitde the basic cause of the depression. But what I should like to emphasize is the important that this study reaped a harvest in results. Not only we a bill before Congress which, in a very practical and simple way, giv(« an American [dan for controlling buying power but also we have a full report from committee. The committee announced its ftn^ngs to the House May 14, 1932, in House Document 1320, giving its views ai to the cause of the depression, and I am sorry to say than so Uttle publicity has been given to this report that probfijbly not more than two or three men now in the hearing of voice, outside of the members of this committee, ever that report. Yet it is one of the most important docume: in ray Judgment, that ever issued from a committee of gress. I think the gentleman from Pennsylvania [Mr FaddxmI read it, if I am not mistaken. I believe the ge men from Ohio [Mr. Lakmxck and Mr. Wxsrl read three Members within the hearing of my voice. I wan read this to you now since you would not read it yourseliees. if on what the committee said was the I want to read to you cause of the depression: The committee, through the weight of teetlmony, has learned that the owjor depressions b«ye followed gorerxunentol action which directly restated Is the dislocation of money and thrGUgh It of commodity values, or. in other words. In the destructlo i of profits from productive Industry. Profits reduced when the i ;en- enU comoaodlty price level Is suddenly lowered by whatever oiuse and completely w4>ed out when the price level goes below the cost of production. The position of the United States has shifted as a result of the World War from a debtor to a creditor naflon As a result of this, the profit from our productive industry assumed greater Inportance as It estahllahes through investiaent as weU as consiunptlon the basis of a market for our manufac- tured products. The maintenance of a condition of prospirity In the United States Is, therefore, accentuated to the point ^hat the restoration of productive industry to a proflt-eamlng Is of transcendental Importance. To convey this Idea, in oiher words, we would say that the purchasing power of money i^ust be brou^t back to normal, and. to do this, the causes of equUfbrium in money must be removed. Our Investigation revealed that certain European B*tk>ns, In an effort to Uulr manufactviring Industries by affording a better cost through lower prices of raw materials and foodstuffs, suddenly, and either Inadvertently and untntentionally or quite dellljer- ately. depressed tbr world commcxUty price levels below the Ff^lnt that admits of any profit to the American producer. We that this result hss followed directly and definitely from ceitaln so governmental acts, the effects of which are clearly traceablfe that all the Important facts are well sustained by the evldene^ we bare gathersd. Idls- has prdtect liasis and That statement was made a long time before we did any- thing about it. I am not sajing that the House did nothing. It did recognize rather early in 1932 that the purchasing power of money must be brought back to normal. Or to state it in another way. that the commodity price level must be raised, by its overwhelming vote on the Goldsborough bill in May or Jime of that year. Except for certain action on the part of our Federal Reserve authorities, nothing was done until President Roosevelt came into power, when he boldly proclaimed that the 1926 price level must be reestab- lished. I am in thorough accord with him in that objective, although I may disagree with him in the details of its ac- complishment. He recognizes the fact that the purchasing power of money must be brought back to normal, that gold has been rari- fled in value, that all other commodities and services have been depressed correspondingly in the other direction be- cause gold Is the yardstick of measure for values. I step in at that point and say here we have solved his problem. I say we have in this bill this remedy. We have worked out the solution. We can control gold and without foreign com- plications, and here in this bill is how we can do it. His treatment, so far as has been revealed, does not go to the extent of controlling gold or even of lowering the value of gold as a supreme world commodity that measures the value of all other commodities and services that are exchanged internationally between gold-standard countries. And here is the crux of the whole problem. There is a difference in the interest of nations. Some nations, and the United States is a conspicuous example as such, produce more of the prime commodities than their domestic needs call for, as well as manufactured articles — and when I say prime commodities I mean foodstuffs and things that are to be processed by manufacture. Other nations are more in the nature gold to get redemption. did he not? Mr. FIESINOER. I am not informed as to the exact de- tails, whether it was $4,000 or $«,000. It took quite a large transaction for gold to be delivered for currency. But the point I am making is this. The change gave the Bank of India a basis for canceling the silver rupee notes and re- issuing the new notes. This released the silver bullion, and when it was sold It destroyed billions of dollars' worth of values in the silver-money base of the world, and since silver and gold are interchangeable, or, as Montagu Norman puts it. since " there is an interaction between gold and sUver ", our banks got the pressure, our real-estate and seciuity values, and we now know how that was passed down the line from one thing to another. Mr. WHITE. When such redemption Is made. It Is a fact, is it not, that the Indian gets gold bullion and not gold coin? Mr. FIESINOER. Exactly. I thought I said that they were on the gold-bullion basis. The point I wish to make is that it was the sale of the silver from 65 cents to 25 cents per ounce which put the corporations of Asia out of silver and into gold or gold equivalents. You cannot destroy a part of the money base without increasing the pressure on what is left. History has no other story to tell no matter how far back you may go. The value of the world's money base can be protected just as it can be upset, and the purpose of this bin is to afford that protection. If you will study this bill you will find that the struggle to comer, scramble for, and hoard gold would cease. The world commodity price level would rise under the control Congress has set in this bill, profits would ensue Instead of losses. Banks would open their doors to productive enter- prise, labor would be employed to reconstruct the world in the new era, the farms of America would again help to feed and clothe the world. Instead of going further in debt, the farmer could pay his debt from his profits. The gold standard, which has gone " haywire ", would be restored to a new and improved gold standard. It would be brand new, not the old gold standard of the intermational 252 CONGRESSIONAL RECORD— HOUSE \ 3 January 8 bMikfrt. but the goM stAodftrd of the people. It woul 1 be ft fUndftrd Uir to conetuneri and produeen, debton ftnd eredlton. with % sUble purehMing power for the doUai for ft generftUon. «• ftdvocated by the Preeldent. Zt would i Urn- i&ftte the neceselty of mftnftged currenciee leeued by f 01 elgn bftnklng imUtutlonc. luch m the Bftnk of Engtend. Or the neccMity for » paper doiUr tied by ftgreement t<: the English paper currency. It would put found money iiiued by the United SUtet in competition with foreign bftnk r otee We could sUnd thle competition. We could regain our market with it. Tboee who want our things will pay a fair price, and they will pay the price under tbia bill in temu of world wsalth and not in terms of artificial currencies. Let me omph uize this point. Our markets will bring us more wealth, not 1 nore dollars of lesser value which will not increase the real ^ 'alue received. We have a lot of talk about currency experimentation through silver. You would get the impression through ■ourees that are half -informed that I would deal here with the currency; that this bill would inflate the currency; that this is silver inflation; or that it is currency inflation. That is not the correct picture. I propose, in this bill, not to deal with currency at all. but to deal with the ir one- tary base. I would not deal in experimentation with this money base. I would stop experimentation. I would i>ro- tect the full- value monetuy wealth of the world (gold and silver) from manipulation, and I would protect it bH the guarantee that this bill gives that it will be held in value and that it cannot any longer be subjected t kind of action reported to Congress by our committee, bill puts the United States Government as a sentim watch over, to guard, and to protect the money base manipulation of the international bankers of Europe. And I say to the Congress that, if Congress will giv^ the world a soimd and stable money base, it will then be sible for our BanJcing and Currency Committees to gi \ a sound and stable currency founded on this stable base. The trouble with the world's national currenc they have been built up upon a foundation of sand, dtie to the fluctuations of the purchasing power of the previous metals which constitute the world's money base. We to restore to the world a sound and stable money base, bill aims to do it. If it will not do it. I will be iiideed thankful to any Member who will show me why not a^d in what respect it will not. We can build up the silver base to take the pressu^ ofiF of the gold base exactly as England and Prance have down the silver btise and thereby increased the pressure on the gold base. We are all familiar with the results of this thing. let us study the causes and the remedy proposed in bill to cure these causes. Mr. McFADDEN. Will the gentleman yield? Mr. FTESINGER. Yes. Mr. McFADDEN. The gentleman has referred tc monetization of silver in the Far Ea:st. Mr. FIESINGER. Yes. - Mr. McFADDEN. Is the gentleman aware of the that before demonetization took place it was a matter of conferences between the heads of the central banks ck the world and the head of the Federal Reserve Bank of York, and that, imdoubtedly, Dr. Sprague sat in those ferences as the adviser of the head of the Federal Rejserve Bank of New York? Mr. FIESINGER. I have no information about thai but that would be fairly inferrable from the finding o| the committee. [Applause.] [Here the gavel fell.] Mr. SWANK. Mr. Speaker. I ask unanimous conse^it to proceed for 10 minutes. The SPEAKER pro tempore (Mr. Claxx). Is objection to the request of the gentleman from Oklahoma? There was no objection. Mr. SWANK. Bf(r. Speaker, many times have I addressed this House on the subject of agriculture and have always pos- e us ney is need This Now, this de- fact New con- Uhere •upport«d ftU legislation for bettering eoodltlons of our fftrm- ers and working people. X>o what you will, build fts you nuy, but there can be no return to prosperity until agriculture is rebftbUltated. With a prosperous Agriculture there U no depression and everybody enjoys that prosperity to which they are entitled. Agriculture is our basic Industry ftnd the one upon which all other business depends. Farmers are the only people in this country who produce the necessities of life. Many of the comforts and luxuries we could live with- out, but we have to have things to eat and wear, and they are produced on the farm. When we assist agriculture we help all lines of business. Our farmers are the only business men who can continue to produce at less than cost. Farm- ers worlc as hard as ever, are honest and patriotic, and are entitled to a fair rate of profit upon the products of their toil. They have worked faithfully along with our other citi- zens for the success of our national recovery program. I supported the Agricultural Adjustment Act in the last Congress, and believe much good has resulted from the operation of that measure, but also believe that additional supplemental legislation should be enacted in order to have complete recovery from this depression. January 15, 1932, I introduced H.R. 7797, known as the " Swank-Thomas coet of production bill ". which is endorsed by the National Farm- ers' Union program and sponsored by that organization. This bill, as Hil. 3208, was also introduced in the first session of the present Congress, and I have introduced the same bill, with some modifications, in the present ses- sion. H.R. 6165. This bill provides that It is declared to be the policy of Congress to secure to farmers a price not less than cost of production, including a reasonable profit, of any agricultural product which is needed for do- mestic consumption. The Secretary of Agriculture is author- ized and directed to make public the part of the domestic production of any agricultural product needed for domestic consumption. The bill provides that such portion shall be sold at a price not less than cost of production, including a reasonable profit, as determined by the Secretary of Agri- culture. The surplus, if any, shall be exported, withheld from market, or otherwise disposed of, as directed by the Secretary of Agriculture. The bill provides that the Secretary of Agriculture shall license purchasers of agricultural products and provides that no person shall carry on any business specified in the an- nouncement unless he has obtained a license. The bill makes it unlawful for any licensee to purchase that portion of any agricultural commodity needed for domestic consumption at a price less than cost of production, including a reasonable profit. The bill provides a penalty for violatioris of this provision. The bill permits an interchange or barter of agricultural commodities among producers or others for purposes of domestic consumption. The Department of Agriculture states that the cost of pro- ducing cotton, wheat, corn, and oats for 1830. 1931, and 1932 is as follows: Cotton Wheat Cora Data 1990 CtiUf per pound lG.a 9. 1 9.0 Per /rtttkW $1 00 .81 .75 CenU ptT bu*hfl sa 01 40 Orn/* per bruM £4 1931 43 1932 30 Mr. Speaker, I do not believe anyone will contend that the farmer is not entitled to the benefits provided in this bill. The measure does not provide that the farmer shall receive only cost of production but it provides that he shall not receive less than cost of production, including a reasonable profit. If the market price is more, the farmer would receive that price for his products. Mr. Speaker, I have had much experience in agriculture and can figure cost of production. I believe any person who wiD take the time to figure this cost and include everything that the farmer puts in his crops will soon see that the fig- ures on cost of production, as given by the Department of Agriculture, are too low. These figures do not include any 1934 CONGRESSIONAL RECORD— HOUSE 25S protit. In Jantuuy 1939 the Ifatloiutl Fftrmen' Union. Na- tloMtl Orange, and the Ameiican Farm Bureau Federation all endorsed thle coet-of -production provUlon. Theie organ- izatloni understand the farm problem. X wleh to call the attention of the House to what Is known as the " Frazler Mil ", Hit. 2866. introduced In the House by the gentleman from North Dakota (Mr. Lemxe). Z flled a motion In the first session of this Congress, which motion Is now on the Speaker's desk, to discharge the Committee on Agriculture from further consideration of the bill and to bring it before the House for consideration. This bill pro- vides that farm indebtedness and mortgages now existing may be liquidated and refinanced through real-estate mort- gages on the amortization plan at IMt-percent interest and l^-^ -percent principal per annum, and through mortgages on livestock used for breeding or agricultural purposes at 8 percent per annum, through the Federal farm loan system and the Federal Reserve banking system. The bill provides that the money shall be derived by the iasuance of IVa-per- cent bonds which, if not sold, and they will not be sold at that rate of Interest, will be presented by the Federal farm loan board to the Federal Reserve Board, as a basis for Issuing Federal Reserve notes or paper money to loan direct to the farmers. I understand that the legislatures of 20 States have passed resolutions asking Congress to enact this bill. All Members of the House who believe that the Frazier bill would be of assistance in liquidating farm mortgages are respectfully asked to sign the motion and bring the bill before the House for consideration. The National Farmers' Union, in convention in Omaha November 20. 21. 22, 1933, endorsed the Swank-Thomas bill, the Frazier bill, and the Wheeler bill, providing for the remonetization of silver. The legislative program of the National Grange says: Justice and the national Interest alike demand that all arbitrary and artificial price boosting in industry must stop until farm prices are brought to an equality with industrial prices. The Agriculture Adjustment Act, approved May 12, 1933, contained an amendment offered by Senator Thomas of Oklahoma, providing for the issuance of United States notes not to exceed $3,000,000,000. The amendment also gives the President power to reduce by proclamation the gold content of the gold dollar by as much as 50 percent, and personally I would like to see this provision put into effect, because we need a greater amount of money in actual circulation among our people. I believe that the remonetization of silver will be one of the greatest boons to agriculture and to recovery in general. This would greatly increase our export trade with foreign coim tries and therefore assist in bringing about better prices for agriculture. Mr. Speaker, in times of depression agriculture is the first business hit and is usually the last to recover. This administration has gone further in granting relief to agri- culture and on the question of inflation of our money system than any other administration, and has done more for the common people of our country. While we all have our individual views, we must remember that there is more than one road to town. I believe the President of the United States is doing his utmost to take our Government from the hands of the selfish mterests and restore it to the people. None of these bills are perfect and they will doubtless need amendments. I believe the enactment into law of the Swank-Thomas bill, the Frazier bill, remonetization of silver, and the Thomas amendment to the Agricultural Adjustment Act, in connection with the acts now \n force, will soon bring us to a complete recovery. [Applause.] Mr. SHOEMAKER. Mr. Speaker, I ask unanimous con- sent to address the House for 30 minutes. The SPEAKER pro tempore. Is there objection to the request of the gentleman from Minnesota? There was no objection. Mr. SHOEMAKER. Mr. Speaker, ladies and gentlemen of the House, we have heard a lot of talk today about money in the hands of the people. Personally, I have not any. and that is one reason for the poverty I am in. I am going to talk about several things that the House should be familiar with and know about. I am going to talk about inptrlaUfln In Lattn Amtriea. not bf Orttt Britain in India or Japan In China, but our own Imptrlallflm In L*tin America that the ptopto ahould be f amUlarlatd with. But bef Off X Uk« up that fubjoct. X want to eall tht atton- tlon of the House to wh«t tho Unltod SUtoa of Amorlca hat boon doing with rtfertnot to tho purohMt ot AmtrleMi* made goods. Xt majr Intorwt jrou to know thftt tho blggoat purchaser of foodstuff la tho Unltod Statea Panama Canal Commission, which suppUat tho Armjr and tht Navy. XI might Interest you to know that the Panaow Canal Coounla- slon Is one of the biggest merchants In the wortd. Xt eup- pUaa the ships going In through the Canal, tho great croii roads of the commerce of the world. It may Interest you to know that our Oovemment haa been selling Cuban beef to these ships that go through tht Canal. Not only that, but we have been bujrlng tons and tons of butter from New Zealand and Australia and selling it on the Paiutma Canal Zone. We have been buying livestock and selling the beef to the ships that pass through. Not only that, but there are 60,000 employees on the Canal Zone. There are in the neighborhood of 10 to 16 thousand sol- diers and sailors there, and we are buying foreign goods and selling them to these people, soldiers, and sailors. I think you ought to know about it. I think the President should know about it, and I think the War Department and the State Department should know about it. Mr. COCHRAN of Missouri. Will the gentleman yield? Mr. SHOEMAKER. Certainly. Mr. COCHRAN of Missouri. Does not the gentleman know that there is a law that prohibits that very thing? Mr. SHOEMAKER. I am familiar with it, but I want to say that the law is not obeyed. Mr. COCHRAN of Missouri. The law prohibits that very thing and requires the purchase of American goods. Mr. SHOEMAKER. But they are not doing It. When the international bankers were confronted with a critical situa- tion in Cuba they went into Cuba and foreclosed on the beef cattle and sold them out — ^unloaded them on the United States Government. Not only that, but God, in His infinite wisdom, was kind enough to have one ship flounder and several thousand dollars worth of these goods went over- board. Another thing that you ought to know about are the con- ditions that exist down there on the Canal Zone. They are conditions which ought not to exist. Ladies and gentlemen, do you know that the United Statea of America has practically not one friend among the Pan- amanian people, a people whose friendship we should encour- age, a people who in time of war would be our greatest asset, a people who should have the very greatest confidence in the United States of America. Yet as a people they have no confidence in the United States. I do not know whether you gentlemen know it, but for over 20 years the Pana- manian Government has plead, has sought, has beseeched America imder the treaty to allow the Panama Oovemment to build a highway across the Isthmus of Panama, not on the Canal Zone, which is leased and operated by the United States of America, but upon their own property, and they have been refused that request. Tliey have been denied that request, TTiey have started work. Tliey have even gone so far. in order to get some means of transportation, as to put in a bcu-ge line from Pedro Miguel Locks to Gatun Lock, to haul freight, and they were absolutely put off Lake Gatun and denied the right to use their own lake on their own prcqjerty outside of the Canal Zone for commercial purpoeea. Mr. MOTT. Mr. Speaker, will the gentleman yield? Mr. SHOEMAKER. Yes. lix. MOTT. Will the gentleman tell us what Jurisdkrtkm the United Statea Government has to prohibit the Pan- amanians from building a road across the Isthmus outside the Canal Zone? Mr. SHOEMAKER. Yes; I can. Mr. MOTT. What is it? Mr. SHOEMAKER. The arrogance of the Department down there that has told them they could not do it. Mr. MOTT. What difference would it make If the Depart- ment did tell them so? I ask the gentleman what jurisdic- 254 CONGRESSIONAL RECORD— HOUSE i! January 8 tlon the united States Oovemment has over the Pai^ama Rei^ibUc. so far as buildui« that road is concerned. Mr. SHOEMAKER. Under a treaty between the Uiilted States and the Republic of Panama, Panama is foreyer kept from having an army or armed forces. They can have no more than a police force, and that must be limited to 1 man for every 30 inhabitants of an Incorporated city, and the Panamanian people are not in a position to face the bayonets of the United States marines and build a jroad such as they want. Mr. MOTT. The gentleman has not answered my 4ues tion. I asked him what Jurisdiction the United States v ould have to prohibit the Panama Government from building a road across the Isthmus in the territory of the Panama Republic outside of the Canal Zone, and I ask the gentle- man if he is stating to the House that the United S ^tes Government did prohibit the Paiuunanians from ( oing that? Mr. SHOEMAKER. They did prohibit them from build- ing the road, and I will tell you what autiiority they had. Under the old grant given to the Panama Railroad ir the early days, before the days the French tried to dig the Canal, the Cclombian Government granted that road, i?hen It was buUt, the exclusive right to transfer freight and ma- terials back and forth across the Isthmus. Under thit old charter they are sasring that if the Panamanians build a wagon road across the Isthmus of Panama it will take busi- ness away from the railroad company, which is owned b r the United States Government. Does that answer the ques ion? Mr. MOTT. It does not. I am asking the gentleman how the United States Oovemment can prohibit the Panamanians from building a highway across the Isthmus, not in the Canal Zone but in the territory of the Paiama Government. Mr. SHOEMAKER. The same Jurisdiction under wtilch they stepped into Nicaragua and into Santo Domingo and Haiti and every other country in their imperialistic way and teld those people of Latin America what they wanted and ^^lat they must do, for American capitalists. Mr. MOTT. I don't think the gentleman has answered my question, and I am inclined to doubt whether the Oov- emment of the United States ever issued such an order or attempted to prohibit the building of such roads ou\side the Canal Zone. mx. SHOEMAKER. I am authorized to say here this afternoon at the behest of several members of the Piina- manian Cabinet, the President's Cabinet, that there lies earmarked in the Bank of Panama $1,000,000 which has been appropriated and set aside for the piunpose of buililng ■ % road from Oatun Lock to Madden Dam by the Govera- ment of Panama and that if that money is not pu: to use within the next 30 days another rainy season win be on and the people of Panama will be forced to use |that money to feed thdr poor, and they have offered tol the United States Government that they will build the road according to the surveys already made by the United Slates Anny engineers and will give the United States Govern- ment fun privilege and right to use that road any time for military or other activities In behalf of the Umted States of America/ Mr. MOTT. The gentleman is talking about territory in the Canal Zone. Gatun Dam and Madden Dam are Iwth in ttie Canal Zone. I am talking about a road acrossjthe Isthmus of Panama In the Republic of Panama. Mr. 8HCSMAKER. There are 34 milee left to be Uuilt that can be built, which is partly on Panama territory and partly on Canal Zone territory, which they offer to the United States Government, and have $1,000,000 appropri- ated to do It. but they have been refosed the righ, to build that road. j Mr. MOTT. That refusal is a very different thing ihan the refusal to build a road across the Isthmus in P^na- manian territory. Mr. SHOEMAKER. They have also refused them to liuild a road across tl^ Isthmus on their own territoxy anc on their own lands, because of that old franchise given to the Panama Railroad Co. almost a hundred years ago. Mr. MOTT. I think Congress would be very much inter- ested in having the documentary evidence to that effect. Mr. SHOEMAKER. That is why I am making this speech now, in the hope that they will get it. The greatest landowner of the Republic of Panama is the United States Government. The United States Gov- ernment owns the city of Colon, Panama. It receives rental from every foot of ground in that city, and the real estate thereon at the expiration of the leases reverts to the United States Government, or to the Panama Railroad Co.. ite subsidiary. It might interest you to know that Panama has no land tax law, and the Senate of Panama refiises to tax its own citizenship a land tax on their farms and their agricultural pursuits so long as the greatest landowner In the Republic pays no taxes to the Panamanian Government. "Hiat is, the United States of America, which owns the city of Colon. Not only that, but to show the arrogance that has been exercised on the Canal, the United States of America pumped the bottom out of the sea in Colon Harbor and built up a territory, on Panamanian soil, in the Canal Zone, known as " New Cristobal ", when it had a strip of land 10 miles wide, beautiful locations for home sites for em- ployees, and so forth. This shut off the view of the Pana- manians who lived in Colon. In addition to that, this Congress appropriated $720,000 to build a high school for the children of the employees In the Panama Canal Zone. United States Government oflBcials In charge, took that $720,000 and built a high school upon the soil and territory of the Republic of Panama. When this school was completed, this is what happened: They put the American flag up on the high school. It made the Pana- manians so irate that they organized a vigilante committee of patriotic Panamanians and they went and tore down the United States flag from the schoolhouse. which was built in the RepubMc of Panama, and in which the Republic of Panama children were denied the right to use the school. In addition to that. It might interest you to know that the women of the Canal Zone have been putting up a ter- rible fight in Panama because of the moral conditions which exist there. It might interest you ladies and gentle- men to know that the United States of America is the owner of the land and is leasing blocks and blocks of land in the city of Colon, upon which brothels are built, and running openly in defiance of all moral law and human decency. The United States Government each month is collecting money and revenue from the sale of womanhood in the city of Colon. Here is another thing that possibly some of you people do not know, and that is that the United States Federal law down on the Isthmus, In the Canal Zone, provides for an age of consent of 13 years. The age of consent down there is 13 years. It was only a short time ago that an oflQcer. a policeman, a United States Government policeman, holding the same Jurisdiction as a policeman in the District of Co- himbia, attacked a girl 13 years of age. He was about to be tried for rape, and I say to you that when the court came into session he proved the girl was 2 months over the age of 13, and so the charge of rape was dismissed, and a charge of adultery was brought in and a small fine was levied by the court. It is almost time this Congress raised the age of consent above 13 years on United States Goverrunent property. Here is another situation: We appropriated in this coun- try, through ovu- Recovery Act, between 6 and 7 mil- lion dollars for the purpose of eliminating some of the unemployment down in the Canal Zone. It might interest this Congress to know that from 85 to 95 percent of that money is being paid out to British subjects who are aliens, not citizens of the United States in any sense of the term! This money is being paid out to them, and practically the only Americans receiving any of this money are the super- visors and foremen in the construction of the projects down 256 CONGRESSIONAL RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE 255 in the Canal Zone and the Army barracks and things sup- plementary thereto. These i)eople are Jamaicans and Ba- hamians and citizens of Barbados, who are British subjects, brought over there, and therein lies another bone of ciles and drop a bomb over the side of the car? Mr. SHOEMAKER. I want the gentleman from Kentucky tMr. BsownJ to know that the lay of the country down there makes it impossible to build a road anywhere along that canal that is not 4 or 5 miles back from Gatun Lake or back from the railroad. This happens to be true because of the topography of the country. They are not going to build any road right along the edge of the canal, because that would be impossible, and that would be just as dangerous with re- spect to beirig blown up as the present railroai or the dam or one of the locks. It maji' also interest you to know that at one point there is a grade built across a ravine to hold the water in Gatun Lake, and this holds the lake level up to 87^2 feet, and sev- eral years ago a British syndicate came in there under the ruse of a mining concession and received a concession from the Panama Government, and they now hold possession of that piece of land where Just one little bomb would empty Gatun Lake and put its waters into the Atlantic Ocean in less time than you could tell about it. Mr. BROWN of Kentucky. Did I understand the genUe- man to say that this is going to be a north and south road? Mr. SHOEMAKER. It is goins to be a road across the Isthmus: yes. Mr. BROWN of Kentucky. A north and south road? Bfr. SHOEMAKER. Yes; the canal runs north and south. Mr. BROWN of Kentucky. If the road is 5 miles away, how is it going to cross the canal? Mr. SHOEMAKER. The road will run parallel and not cross the canal. That is by reason of the way the mountains zigzag over Into the lO-mile zone. Mr. BROWN of Kentucky. It is going to t)e a north-and- Bouth road and never strike the Panama Canal? Mr. SHOEMAKER. Yes; and I want to inform the gen tleman from Kentucky that never in the history of the rdations between the United States and Panama has the Panama Government ever refused to grant one request of tbe United States. At the present time the United States of America is build feog a large dam and reservoir, called " Madden Dam " in the Chagres River, which is on Panama territory. A road has been built from Panama City to this dam to aid tn its con- struction, and the road is built mostly upon land belonging to the Republic of Panama. axKi I think we might very well go as far as the Republic of Panama in at least being half- way decent and halfway civilized It might also interest Congress to know that every nation in the world is permitted to ship goods through the Panama Canal except Panama. The United States Government will not allow a Panamanian ship loaded at David on the west coast of Panama to go through the canal aiw^ deliver Its cargo to Porto BeDo on the east coast. Intercoastal traffic has been blocked entirely. How long diall we ccmtinue to discriminate against a small nation in this manner? How Vmg win Congress tolerate these conditions? How long will we continue to furnish evidence of imperialism on our own part to be used by other nations against as? These are ImpcHtant issues that must be met by the American Congress ■ome day. Let us clear up these injustices right now, so we will not be cconpelled to bow our heads in shame before the finger of aminitlnn at the hands af other nations. Let us act now. [Applause-J RECORD— HOUSE January 8 Mr. COCHRAN of Missouri. Mr. Speaker, I ask unani- mous consent to proceed for 5 minutes. The SPEAKER pro tempore. Is there objection to the request of the gentleman from Missouri? There was no objection. Mr. COCHRAN of Missouri. Mr. Speaker, I have just had an opportunity to read — rather hurriedly. I admit — an ad- vance copy of the aimual report of the Postmaster GeneraL While tills was a confidential advance copy, nevertheless it is subject to release today. Therefore in referring to it I am not violating the release provisions. I note with a great deal of interest that the Postmaster General makes a recommendation for additional legislation which will subject persons robbing, or attempting to rob. custodians of Government funds to the same penalties now provided for attacks upon the mails. I agree that such legis- lation is necessary, and will introduce the bill he suggests. The fact that there has been an increase of almost 600 per- cent upon the imits of the Postal Service which handle Gov- ernment moneys justifies this recommendation. These at- tacks in the main are instigated by gangsters who, of course, are not employees of the Postal Service. I am rather astonished, however, to fail to find any recom- mendation in the report to curb the racket of fourth-class postmasters who have beea robbing the Government for a good many years. There are 33,000 fourth-class postmasters in this country. The great majority of these men and women are honest pub- lic officials, obeying the law and regulations to the letter, but there are thousands who, by the use of petty methods, have robbed the Government. Shortly after the present Postmaster General assiuned office I called his attention to these nefarious practices. I had several conferences with the officials and finally suc- ceeded in getting an investigation started, which I hope has resulted in a discontinuance of the practices of which I complained. The fourth-class office is an expensive one to the Postal Service, and assists materially in enlargirxg the deficit which the Postmaster General refers to in his report. This is be- cause Congress has not for over 50 years changed the method of paying the fourth-class postmaster. Under existing con- ditions the fourth-class postmaster is paid upon the basis of cancellations of stamps at his office, plus money he re- ceives for rent of boxes, issuing money orders, and so forth. The Department officials themselves are responsible for the statement that for every $100 in stamps canceled at fourth- class offices it costs the Government $140 in salary. On top of this be it remembered the Government must also pay to carry the mail to its destination. In other words, during the last fiscal year according to figures I received from the Department, $19,450,000 was paid to fourth-class postmasters, and the total cancelation of stamps was $10,500,000. Here we paid nearly $9,000,000 above the amount of stamps sold for the privilege of de- hvering at additional cost $10,500,000 in mail matter. Sev- eral thousand rural postmasters engaged in these *' rackets " I complained of were investigated by postal inspectors. The irregiQarities charged to the postmasters whose rec- ords were scrutinized include such practices as sending heavy packages of merchandise and even bricks and boards by parcel post as a means of increasing their income frtrni cancelations of stamps. Before the investigation is com- pleted it is expected that many prosecutions and a large number of dismissals will result. This investigation has been under way in all sections of the country for the last several montlis. It is also expected many fourth-class offices will be discontinued and other arrangements made for handling mail. Fourth-class postmasters, most of whom are in small villages, receive 160 percent on the first $75 of postage they cancel. 85 percent on the next $100, and 75 percent on all in excess of $175. To this compensation are added the rental of post-office boxes, and an allowance of 15 percent for rent, light, fuel, and equipment. They also receive a com- mission of 3 cents each on all the money orders they issue. l/^/^TZ-V^T k T Ti try r^ r\TyT\ TTrvTTOT? Taxtttaov Q 1934 CONGRESSIONAL RECORD— HOUSE 257 This method of compensating these nural postmasters prompts them to use various devices to increase cancelations. As I said, the more stamps they cancel, the greater their gains. Inspectors assigned to the investigation by Postmaster General Parley reported that postmasters invented many schemes by which to swell their fees for cancelations. With this purpose some of them have mailed bricks, gravel, oyster shells, milk, cream, walnuts, and other bulky but worthless articles. In general these packages were sent by parcel post to relatives of the postmasters. One post- master wrote notes on pieces of board and sent them to a member of his family. Others who conducted stores sell groceries to their relatives and friends in other locaUties and by affixing sufficient postage on the bags and boxes insured their delivery by the rural carrier in his neighbor- hood. He not only received profit on his sales but also received from the Government the amount of stamps placed on the packages, plus the usual percent. So eager are some postmasters to enlarge their commis- sions that they put stamps on the letters they write to the Post Office Department, although franked envelops are sup- pUed to them for use in official correspondence. Why? Because they receive the amount of postage used, I began my Inquiry many months ago, after my attention had been directed to some of the sort of abuses I have de- scribed. Within 1 week I found that about 200 postmasters in Missouri and Illinois were shipping eggs to St. Louis by parcel post. These shipments comprised from 2 to 30 cases. In some instances postmasters sent cases of eggs by parcel post from Missouri to New York City. The charge for postage on these eggs was about $3. They could have been shipped by express for half that amount and by freight at still less cost. It cost the postmaster nothing to ship to New York, but on the contrary he received the amount of stamps used. If a postmaster were to ship enough eggs by parcel post to require $75 in postage, he would not only not lose by the transaction but would instead receive back the full amount he paid for stamps and $45 besides. I presented to Mr. Farley and Mr. Joseph C. CMahoney, former First Assistant Postmaster Greneral, the facts I gath- ered. They at once instituted a Nation-wide investigation. This inquiry tias already corrected abuses in many places and will undoubtedly in the end result in a discontinuance of such practices. Mr. Farley and Mr. CMahoney had an opportunity to see the nature and the extent of this racket. For instance, they found that postmasters in Kentucky and West Virginia were using the parcel post to transport cases of eggs from their communities to Washing- ton, Baltimore, and New York. The mail charges averaged $1.50 or more a case and were natiurally very much higher than would have been the expense of shipping them by ex- press. The principal purpose in mailing them at all was to benefit the postmaster in dollars and cents while the Gov- ernment took the burden. Is there any wonder we have a postal deficit? There were 33,528 fourth-class postmasters on July 1 this year. In an attempt to secure definite information as to the volume of business and the amount paid fourth-class post- masters I called for statistics from the Post Office Depart- ment. I quote from one report. This is on the fiscal year ended July 1, 1933: To sum up the situation, we estimate that the total payments at ftmrth -class offices for all purposes, Including compensation to postmasters, mall-messenger serrlce, special-delivery fees, and sep- arating mall allowance, was a total of $19,450,000, and these pay- ments were made on total cancelations estimated to have been $10.fiOO.OOO. Phrased otherwise, the Government sj)ent all the revenue it derived from these post offices and nearly nine milhons besides to pay the postmasters. Over and above this outlay for handling the mail at these rural offices, the Government was compelled to assume the cost of carrying it to and from them. It is time to change the law fixing the pay of these fourth- class postmasters. They sboukl receive salaries graduated in amount to correspond with tbe volume of business they handle. These fourth-class post offices should in many cases be abolished, and what is known as " rural stations " should be substituted for them. ProprietCHrs of stores in nnall ctrnk- munities are eager to serve as postmasters. They know that many persons who visit the post office are als« potential buyers of merchandise from the store. Revision of the pay of such postmasters and correction of the questionable practices of many of them would un- doubtedly prevent or greatly reduce the loss at present incurred by the Government in handling of mail in the fourth-class offices. I need hardly repeat that the large majority of post- masters of wliatever 9-ade are honest and faithful public servants. The records of the past and the developments in the investigation now in progress onphasize this fact. But the system is defective and grossly expensive, and should be abandoned. It happens also to be a grave tonptation to many men and women who administer it in the fourth-class post offices. The Postmaster General's investigation, when comi^ete, wiU unquestionably reveal the necessity for a quick and thorough reformation. For many years prior to 1877 the fourth-class postmasters were paid in proportion to the stamps they sold. In order to increase their earnings many postmasters disposed of stamps at a discount in large cities, knowing that they would be fully reimbursed in the higher pay they would receive in consequence of heavier sales. The report of the Third Assistant Postmaster General in 1878 exposed this malfeasance and the law was changed. The taxpayer cannot be expected to remain silent when he knows that postmasters have shipped by parcel post bun- dles of ordinary kindling wood costing in some instances 40 cents to mail when the wood disposed of sells for 5 or 10 cents when it reaches its destination. It is hard for one to conceive that a postmaster would ship oyster shells, bricks, produce of every kind, especially perishable vegetables, by parc^ post, paying postage far in excess of the value of the shipment, but the investigation of the post-office inspectors discloses this to be a fact. While I was talking with a post-office official about this matter a letter was brought to his desk. It was an official letter from a fourth-class postmaster, who had placed a stamp over the frank which would have carried the letter without postage. The official informed me that some of them even register an ordinary letter. Postmaster General Farley has inherited this situation, and I am sure he is going to cure it. From my conversation with post-office officials I was convinced that an honest return from a fourth-class postmaster should always be below the amount of stamps actually sold at the station, but it was disclosed that tbe report of cancelation generally equals the sales and in some instances exceed the sales. Last September the Postmaster General referred briefly to this matter in a speech before a postmasters' convention at Rochester. He said then that legislation would be recom- mended to curb the evil; but as it does not appear in his annual report, I will request that the necessary legislation be submitted to me so I can Introduce the bilL I propose to prepare an amendment in the f OTm of a limitation to be offered when the appropriation bill is before the House which will prevent the use of any money appropriated for the payment of salaries to fourth-class postmasters who send through the mail any matter that they would not Hcnd if they were not holding the position of postmaster. I Ap- plause.] Messages fsom the Pusidxmt of the UmnD Statbi NnrrH phxlippxiie lbgxblaturb The SPEAKER laid before the House the following roes- sage from the President, which was read, and, with the accompanying papers, referred to the Committee on Insular Affairs: Lxxvnz- -17 t f\n A /^/-\XTr«T»T:?ociTrvxT a t Tt-c^nr^nx^ TmTTdTn OOft 258 CONGRESSIONAL To the Congress of the United States: As required by section 19 of the act of Congress approved August 29. 1916. entitled "An act to declare the purpose of the people of the United States as to the future political status of the people of the Philippine Islands, and to provide s more autonomous government for those islands ". I trans mit herewith a set of the laws and resolutions enacted by the Ninth Philippine Legislature during its second special ses- sion. January lft-31. 1933. Franxlih D. Roossvilt The Wnm House. January 8. 1934. TWXLTTH LXCISLATTTRK OF PtrEBTO RICO The SPEAKER also laid before the House the following message of the President of the United SUt«s, which was read. and. with the accompanying papers, referred to the Committee on Insular Affairs: To the Congress of the United States: As required by section 23 of the act of Congress approvecl March 2, 1917. entitled "An act to provide a civil government for Porto Rico, and for other purposes ". I transmit herewith certified copies of two volumes of laws enacted by the Twelfth Legislature of Puerto Rico during its fourth and fifth specia: sessions. October 18-21 and November 11-16. 1932. respec- tively, and by the Thirteenth Legislature of Puerto Rice during its first regiUar session. February 13 to April 15, 1933 and its first special session. August 1-14, 1933. Franklxm D. Roosivclt Thi Whiti Hoxnn. January 8. 1934. COIISTKUCTION OF HIGHWAY IH HORTHWUTtXIf PART OF THI UHim STATU WITH BRITISH COLUMBIA, THE TUXOIf TIRRI' TORY. AND ALASKA (H.XK>C. MO. 313) The SPEAKER laid before the House the following mes sage from the President of the United States, which wa i read, and. with the accompanying papers, referred to th( Committee on Roads and ordered printed together witli illustrations: To the Congress of the United States: I transmit herewith the report made by the Amerlcai, commissioners appointed according to an act of Congre&i approved May 15, 1930. The act provided for their coop eration with Canadian representatives in a study regardini construction of a highway to connect the northwestern pa of the United States with British Columbia, the Yukon ter rltory, and Alaska. The work of the commission hav been completed, its existence has been terminated. Franklin D. Rooskvelt. Enclosure: Report. Th« WnrrE House, January 8. 1934. PUBUC SERVICE COIOCISSION OF PUERTO RICO The SPEAKER also laid before the House the following ^ message from the President of the United States, which wa 5 read. and. with the accompanying papers, referred to th^ Committee on Insular Affairs: To the Congress of the United States: As required by section 38 of the act of Congress approved March 2. 1917. entitled "An act to provide a civil govern- ment for Porto Rico, and for other purposes", I transmit herewith certified copies of each of three franchises grante i by the Public Service Commission of Puerto Rico. Thi franchises are described in the accompan3ring letter froqi the Secretary of War transmitting them to me. Fr.\nklin D. Roosevelt The White House, January 8, 1934. civn. service comxissioh The SPEAKER also laid before the House the followink message from the President of the United States which was read, and. with the accompanying papers, referred to thje Committee on the Civil Service: To the Congress of the United States: As required by the act of Congress to regulate and im|- prove the civil senrice of the United States, approved Jan- uary 16. 1883. I transmit herewith the Flftietli Annul 1 RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE 2S9 Report of the United States Civil Service Commission for the fiscal year ended June 30. 1933. Franklin D. Roosevelt. The WhiiE House, January 8, 1934. PHILIPPINE independence (H.DOC. NO. 209) The SPEAKER also laid before the House the following message from the President of the United States, which was read, and. with the accompanying papers, referred to the Committee on Insular Affairs and ordered printed: To the Congress of the United States: I transmit herewith for your information a copy of Con- current Resolution No. 46, adopted October 17, 1933, by the Ninth Philippine Legislature during its third session, entitled " Concurrent resolution informing the Congress of the United States that the Philippine Legislature, in its own name and in that of the FUipino people, declines to accept the act of Congress, entitled 'An act to enable the people of the Philippine Islands to adopt a constitution an4 form a government for the Philippine Islands, to provide for the Independence of the same, and for other purposes ', in its present form and appointing a committee to proceed to the United States at the earliest practicable time to seek amend- ments to said act of Congress, or the enactment of such new legislation as will fully satisfy the aspirations of the Filipino people to become at the earliest practicable date a free and Independent nation, under conditions and clrcum.^tances that will not Imperil the political, social, and economic stability of their country." Franklin D. Roosevelt. The White House, January 8, 1934. RBFORT OF GOVERNOR OF PUERTO RICO The SPEAKER also laid before the House the following message from the President of the United States, which was read and. with the accompanying papers, referred to the Committee on Insular Affairs: To the Congress of the United States: As required by section 12 of the act of Congress of March 2. 1917, entitled "An act to provide a civil government for Porto Rico, and for other purposes ". I transmit herewith for the information of the Congress the Thirty-third An- nual Report of the Governor of Puerto Rico for the fiscal year ended June 30, 1933. This report contains valuable information which it is believed should be available in permanent form. It has heretofore been customary for the President to recommend to the Congress the printing of the annual report of the Gov- ernor of Puerto Rico, the cost of such printing being charged against War Department appropriations. In the present case, however, due to special conditions not ordinarily ob- taining, the Government of Puerto Rico has arranged to make available to the War Department a number of printed copies of the enclosed report, sufficient to meet the minimum needs of the Federal executive departments and also to supply a limited niunber of copies for the requirements of the Congress. In view of these facts and of the urgent need of effecting exceptional economies at this time, the cus- tomary recommendation for the printing of the annual re- port of the Governor of Puerto Rico is omitted. Fr.\nkhn D. Roosevelt. The White Hoxtse, January 8, 1934. perry's VICTORY MEMORIAL COMMISSION (H.DOC. NO. 211) The SPEAKER also laid before the House the following message from the President of the United States, which was read, and, with the accompanying papers, referred to the Committee on the Library, and ordered printed: To the Congress of the United States: 1 transmit herewith for the information of the Congress the Fourteenth Annual Report of the Perry's Victory Memo- rial Commission for the year ended December 1. 1933. Franklin D. Roosevelt. The White Hoitse, January 8. 1934, ARLINGTON MEMORIAL AMPHITHEATER The SPEAKER also laid before the House the following message from the President of the United States, which was read, and, with the accompanying papers, referred to the Committee on Public Buildings and Grounds: To the Congress of the United States: In compliance with the requirements of the act of Con- gress of March 4, 1921, I transmit herewith the annual report of the Commission on the Erection of Memorials and Entombmment of Bodies in the Arlington Memorial Amphi- theater for the fiscal year ended Jime 30, 1933. Franklin D. Roosevelt. The White House, January 8, 1934. REPORT OF GOVERNOR OF THE PANAMA CANAL The SPEAICER also laid before the House the following message from the President of the United States, which was read, and, with the accompanying papers, referred to the Committee on Interstate and Foreign Commerce: To the Congress of the United States: I transmit herewith, for the Information of the Congress. the annual report of the Governor of the Pa;jama Canal for the fiscal year ended June 30, 1933. Franklin D. Roosevelt. Tkk White House, January 8, 1934. REPORT OF COUNCIL OF NATIONAL DEFENSE The SPEAKER also laid before the House the followlnf message from the President of the United States, which was read, and, with the accompanying papers, referred to the Committee on Military Affairs: To the Congress of the United States: In compliance with paragraph 5, section 2. of the Army Appropriation Act. approved August 29, 1916. I transmit herewith the Seventeenth Annual Report of the Council of National Defense for the fiscal year ended June 30. 1933. Franklin D. Roosevelt. The White House, January 8, 1934. rOREION SERVICE RETIREMENT AND DISABILITY SYSTEM (H. DOC. NO. 308) The SPEAKER also laid before the House the following message from the President of the United States, which was read, and, with the accompanjring papers, referred to the Committee on Foreign Affairs, and ordered printed: To the Congress of the United States: I transmit herewith a report by the Acting Secretary of State showing all receipts and disbursements on accoimt of refunds, allowances, and annuities for the fiscal year ended Jime 30. 1932. in connection with the Foreign Service retire- ment and disability system, as required by section 26 (a) of* an act for the grading and classification of clerks in the Foreign Service of the United States of America, and provid- ing compensation therefor, approved February 23, 1931. Franklin D. Roosevelt. The White House, January 8, 1934. (Enclosure: Report concerning retirement and disability fund. Foreign Service.) VETERANS' REGULATIONS The SPEAKER also laid before the House the following message from the President of the United States, which was read, and, with the accompanying papers, referred to the Committee on Expenditures in the Executive Departments, and ordered printed: To the Congress of the United States: Pursuant to the provisions of section 20, title I of the act entitled "An act to maintain the credit of the United States Government ", approved March 20, 1933, I am transmitting herewith certified copies of Executive Orders Nos. 6229 (Veterans' Regulation No. Kb)), No. 6230 (Veterans' Regu- lations No. 2 (a)). No. 6231 (Veterans' Regulation No. 3 (b)). No. 6232 (Veterans' Regulation No. 6 (a)). No. 6233 (Veterans' Regulation No. 7 (a) ) , and No. 6234 (Veterans' Regulation No. 10 (b) ) . approved by me on July 28. 1933. These veterans' regulatlfMia amended the regulations ap- proved by me on March 31. 1933. and June 6. 1933. and were issued in accordance with the terms of title I. Public, Now 2, Seventy-third Congress, "An act to maintain the credit of the United States Govemmeut ". and Public, No. 78. Seventy- third Congress. "An act making appropriations for the Ex- ecutive Of&oe and sundry independent ezecutiye bureaus, boards, commissions, and offices for the fiscal year ending June 30. 1934, and for other purposes." Franklin D. Roosevelt. The Whits House. January t, 1914. ALASKA TERRITOaiAL LEGISLATURE The SPEAKER also laid before the House the following message from the President of the United SUtes, which was read. and. with the accompanying papers, referred to the Committee on the Territories: To the Congress of the Untied States: In compliance with the provisions of the act of Congress approved August 24. 1013. I transmit herewith a certified copy of the Session Laws of Alaska, of the Alaska Ttorritorial L^[lslature. 1938. FaAinazM D. Roosbvblt. The WRXTt Hotrsi, January I. i9S4. CHILD LABOI AXiiiDiairr The SPEAKER laid before the House a communication from the Oovemor of the State of West Virginia announc- ing the ratification by the LegUlaturt of that State of the proposed child labor amendment to the Constitution of the United SUtes. IBAV8 OF Aseiirci By unanimous consent leave of absence was granted aa follows: To Mr. CooFBB of Tennessee, for today, on account of illness. To Mr. Reio of Illinois, until further notice, on account of important business. To Mr. Mansfield, indefinitely, on account of illness in hospital. SENATE JOINT RESOLUTIONS AND BILLS REFERRED Joint resolutions and bills of the Senate of the following titles were taken from the Speaker's table and. under the rule, referred as follows: S JJtes. 15. Joint resolution extending to the whaUng In- dustry certain benefits granted under section 11 of the Merchant Marine Act, 1920; to the Committee on Merchant Marine, Radio, and Fisheries. S.J Jles. 54. Joint resolution limiting the operation of sec- tions 109 and 113 of the CMminal Code; to the Committee on the Judiciary. S.JJles. 59. Joint resolution to provide for the expenses of delegates of the United States to the Ninth Pan Ameri- can Sanitary Conference; to the Committee on Foreign Affairs. SJJles. 60. Joint resolution making an appropriation for an investigation of housing conditions and rentals in the District of Columbia; to the Committee on the District of Columbia. S. 1286. An act to increase the efficiency of the Veterinary Corps of the Regular Army; to the Committee on Military Affairs. S. 1654. An act for the relief of George Yusko; to the Committee on Military Affairs. S. 1759. An act to extend the time for the construction of dams and dikes in Lincoln County. Oreg.. to prevent the flow of waters of Yaquina Bay and River into Nutes Slough. Boones Slough, and sloui^ connected therewith; to the Committee on Interstate and Foreign C!ommerce. S. 1772. An act for the relief of the Western Montana Clinic, Missoula, Mont.; to the Committee on Claims. S. 1867. An act authorizing an appropriation to iHt>vide for the completion of the George Rogers COark memorial at Vincennes, Ind.; to the Committee on the library. 260 CONGRESSIONAL RECORD— HOUSE January 8 8. 1869. An act reUtlnc to the niAnner of appointment ol certain officers of the Uixltad States; to the Committee oc tbe Judiciary. AOJOTTxmfKirr Mr. BYRN8. Mr. Speaker, I move that the House do no^ adjourn. The motion was agreed to; accordingly (at 4 o'clock anc 37 minutes pjn.). the House adjourned until tomorrow Tuesday, January 9, 1934, at 12 o'clock noon. EXECUTIVE COMB4XJNICATION8. ETC. Under clause 2 of rule XXIV. executive communications were taken from the Speaker's table and referred as follows 264. A letter from the Secretary of War, transmitting t report dated January 3. 1934, from the Chief of Engineers United States Army, on preliminary examination of Flin River, Oa.. authorized by the River and Harbor Act approve< July 3. 1930, together with accompanying papers; to ttu Committee on Rivers and Harbors. 265. A letter from the Acting Secretary of State, trans mitting a copy of the circular from the Nobel Committe< of the Norwegian Parliament, fxu-nishing information witt reference to proposals of car.didates for the Nobel peac(! prize for the year 1934; to the Committee on Foreign Affairs 266. A letter from the president of the Board of Commis sioners for the District of Columbia, transmitting a repor of the official operations of the Commissioners of the Dis trict of Columbia for the fiscal year ended June 30, 193; (HJDoc. No. 128) ; to the Committee on the District o Columbia. 267. A letter from the Secretary of the Interior, trans- mitting a list of leases of certain Government lands ai required by the act approved March 4, 1931 (46 Stat. 1523 UJS.C, sup. V. title 30, sec. 226). amending sections 17 anc 27 of the general leasing act of February 25, 1920 (41 Stat 437; U.S.C.. title 30, sec. 226); to the Committee on the Public Lands. REPORTS OP COMMITTEES ON PUBLIC BILLS ANE RESOLUTIONS Under clause 2 of rule xm. Mrs. NORTON: Committee on the District of Columbia HJl. 6181. A bill to control the manufactiu^, transporta- tion, possession, and sale of alcoholic beverages in the Dis- trict of Colimibia; with amendments (Rept. No. 274). Re- ferred to the Committee of the Whole House on the state ol the Union. PUBLIC BILLS AND RESOLUTIONS Under clause 3 of rule XXII. public bills and resolutions were introduced and severally referred as follows: By Mr. BUCK: A bill (HJl. 6525) to amend the act knowr as the " Perishable Agricultural Commodities Act, 1930 " approved June 10. 1930; to the Committee on Agriculture By Mr. CHASE: A bill (HJl. 6526) to provide for the reestablishment of regional insurance offices by the Veterans Administration, and for other purposes; to the Committee on World War Veterans' Legislation. By Mr. SMITH of Washington: A bill (HJl. 6527) tc authorize the Reconstruction Finance Corporation to make direct loans to approved firms and corporations for paji rolls and working capital; to the Committee on Banking and Currency. By Mr. WALLGREN: A bill (HJl. 6528) to provide for the construction of works for flood control, the prevention ol soil erosion, and the improvement of navigation in the Snohomish, StUlaguamish, Skagit, and Nooksak River Basins in the State of Washington; to the Committee on Flood Control By Mr. HEALEY: A bill (HJl. 6529) to provide for guar- anteeing of the principal of bonds issued by the Home Owners' Loan Corporation: to the Committee on Banking and Currency. Bj Mr. ELTSE of California: A bill (HJl. 6530) granting nod confirming to the East Bay Municipal Utility District, » municipal utility district of the State of Calllomia and a body corporate and politic of said State and a pohtical nibdivision thereof, certain lands, and for other ptirposes; to the Committee on the Public Lands. By Mr, CHRISTIAN80N : A bill (H.R. 6531) prohibiting the importation of certain eggs into the United States; to the Committee on Ways and Means. Also, a bill (HJl. 6532) prohibiting the importation into the United States of certain meats; to the Committee on Ways and Means. By Mr, SWANK: A bill (H.R. 6533) to promote education, relieve unemployment and economic distress, and for other purposes; to the Committee on Education. By Mr. SCRUGHAM: A bill (H.R. 6534) to provide for guaranteeing the principal of bonds issued by the Home Owners' Loan Corporation; to the Committee on Banking and Ciurency. By Mr. HILL of Alabama: A bill (HJl. 6535) to provide for the exploitation for oil, gas, and other minerals on the lands comprising Fort Morgan Military Reservation, Ala.; to the Committee on Military Affairs. By Mr. KELLER: A bill (H.R. 6536) creating the Cairo Bridge Commission and authorizing said commission and its successors to construct, maintain, and operate a bridge across the Ohio River at or near Cairo, 111.; to the Com- mittee on Interstate and Foreign Commerce. By Mr. BROWN of Kentucky: A bill (Hil. 6537) to guar- antee the principal of bonds issued by the Home Owners' Loan Corporation: to the Committee on Banking and Currency. By Mr. DIMOND: A bill (H.R. 6538) authorizing the sur- vey, location, and construction of a highway to connect the northwestern part of continental United States v/ith British Columbia. Yukon Territory, and the Territory of Alaska; to the Committee on Roads. By Mr. SWICK: A bill (H.R. 6539) to expedite the con- sideration and award of decorations by the War and Navy Departments for services in the Army, Navy, and Marine Corps during the World War; to the Committee on Military Affairs. By Mr. MILLER: A bill (H.R. 6540) to provide for ap- praisal by the Farm Loan Commissioner and Federal land banks of land situated in levee, drainage, road, and other improvement districts and to prevent discrimination against such land; to the Committee on Agriculture. By Mr. McSWAIN: A bill (H.R. 6541) to further promote national defense, and to amend the National Defense Act; to the Committee on Military Affairs. By Mr. MILLER: A bill (H.R. 6542) to authorize the Re- construction Finance Corporation to accept the l)onds issued by the Home Owners' Loan Corporation at face value in pay- •ment of obligations due it, and for other purposes; to the Committee on Banking and Currency. By Mr. MALONEY of Connecticut: A bill (HJl. 6543) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Govern- ment ", and Public Law No. 78. Seventy-third Congress, en- titled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commis- sions, and offices, for the fiscal year ending June 30. 1934, and for other purposes; to the Committee on World War Vet- erans' Legislation. By Mr. BANKHEAD: A bill (H.R. 6544) to place the cot- ton industry on a soimd commercial basis, and to prevent unfair competition and practices in putting cotton into the channels of interstate and foreign commerce; to the Com- mittee on Agriculture. By Mr. EVANS: A bill (H.R. 6545) to provide reUef for damages caused by unusual floods in the State of California dming the year 1934; to the Committee on Ways and Means. By Mr. COCHRAN of Missouri: A bill (HJl. 6546) amend- ing section 320 of title 18 of the United States Code; to the Committee on the Judiciary. By Mr. CARTER of Wyoming: A bill (HJl. 6547) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78, Seventy-third Congress, entitled "An 1934 CONGRESSIONAL RECORD— HOUSE 2S1 act making appropriations for the executive office* and vun- dry Independent executive biireauB, boards, commissions, and offices for the fiscal year ending June 30. 1934. and for other purposes "; to the Committee on World War Veterans' Legislation. Also, a bill (HJl. 6548) for the relief of veterans of the Spanish -American War. including the Boxer rebellion and the Philippine insurrection; to the Commmittee on Expendi- tures in the Executive Departments. By Mr. DIMOND: A bill (H.R. 6549) to authorize the incorporated town of Wrangell, Alaska, to issue bonds in any sum not exceeding $47,000 for municipal public works, including enlargement, extension, construction, and recon- struction of water-supply system; extension, construction, and reconstruction of retaining wall and filling and paving streets and sidewalks; and extension, construction, and reconstruction of sewers in said town of Wrangell; to the Committee on the Territories. By Mr.'McCORMACK: A bill (H.R. 6550) to remove the limitation on the filling of the vacancy in the office of United States district judge for the district of Massachusetts; to the Committee on the Judiciary. By Mr. MALONEY of Connecticut: A biU (HJl. 6551) creating a postage stamp in honor of the commemoration of the one hundred and fiftieth anniversary of the founding of the Order of the Purple Heart; to the Committee on the Post Office and Post Roads. By Mr. REILLY: A bill (H.R. 6552) permitting landowners who have suffered damages on account of prosecution and maintenance of the improvement of the Wisconsin and Fox Rivers, in the State of Wisconsin, to institute action in the Court of Claims or the United States district court for the recovery of such damages: to the Committee on the Judiciary. By Mr. McSWAIN: A bill CRU. 6553) to amend the act of June 15, 1933, amending the National Defense Act of June 3, 1916, as amended; to the Conunittee on Military Affairs. Also, a bill (H.R. 6554) to establish a department of phys- ics at the United States Military Academy, at West Point, N.Y.; to the Committee on Military Affairs. Also (by request), a bill (HJl. 6555) to increase the effi- ciency of the Medical Corps of the Regular Army; to the Committee on Military Affairs. Alsa (by request), a bill (H.R. 6556) to amend section 2 of the act entitled "An act to give war-time rank to retired of- ficers and former officers of the Army, Navy, Marine Corps, and/or Coast Guard of the United States ", approved June 21. 1930, so as to prohibit persons who have been subse- quently separated from the service under other than honor- able conditions from bearing the official title and upon oc- casions of ceremony wearing the uniform of the highest grade held by them during their war service; to the Com- mittee on Military Affairs. Also (by request), a bill (H.R. 6557) to amend the act en- titled "An act to amend an act entitled 'An act to prohibit the unauthorized wearing, manufacture, or sale of medals and badges awarded by the War Department, approved Feb- ruary 24, 1923, approved April 23. 1928 ", so as to include the Navy; to the Committee on Military Affairs. By Mr. DIMOND: A bill (HJl. 6558) to authorize the in- corporated town of Juneau, Alaska, to issue bonds in any sum not exceeding $100,000 for municipal public works, in- cluding regrading and paving of streets and sidewalks. Installation of sewer and water pipe, construction of bridges, construction of concrete bulkheads, and constnic- tion of refuse incinerator; to the Conjmittee on the Terri- tories. By Mr. CKTJJIR: A bill (HJl. 6559) to assure to persons within the jinisdiction of every State the equal protection of the laws, and to punish the crime of lynching; to the Committee on the Judiciary, Also, a bill (HJl. 6560) to renew appointments to regular positions in the Government service; to the Committee on Expenditures in the Executive Departments. Also, ft Mn (HJl. $Ml) to estabUch m ao-hour work mtk in all branches of the United States Oovemment Mrvlce: to the Committee on the Civil Service. Also, a bill (HJl. 6M2) to repeal legicUtlon Impoaing sal- ary cuts upon GoTemment employees; to the Committee on Expenditures in the Executive Departments. By Mr. McLEOD: A bill (HJl. 6563) to eliminate certain discriminations in the existing revenue laws pertaining to temporary dealers in beer and other malt liquors: to the Committee on Ways and Means. By Mr. ELLENBOGEN: A bill (HJL 6564) to amend the Home Owners' Loan Act of 1933, to revive the coi^tructlon industry by financing the construction of new homes with bonds of the Home Owners' Loan Corporation, to guarantee the principal of and to give the circulation privilege to the bonds of the Home Owners' Loan Corporation, amend the laws relating to national banking associations and to Fed- eral Reserve banks, and for other purposes; to the Com- mittee on Banking and Currency. By Mr. HOEPPEL (by request): A bill (HJl. 6S«6) to equalize the pensions of widows of veterans of the Civil War. the Indian wars, the Spanish-American War, the Philippine insurrection, the Boxer rebellion, and the regular services; to the Committ/ee on Invalid Pensions. By Mr. McLEOD: A bill (HJl. 6566) to protect the cur- rency system of the United States by requiring the transfer to the United States Treasury of all gold held by the Fed- eral Reserve System; to the Committee on w^'^^ng and (Currency. By Mr. YOUNG: A WD (HJl. 6567) to release veterans from the liability to pay interest on loans secured by ad- justed-service certificates, to provide for the refimd of interest paid on such loans, and for other purposes; to the Committee on Ways and Means. By Mr. DEAR: A bill (HJl. 6568) authorizing payment to the Red River, Atchafalaya, and Bayou Boeuf Levee District for acquiring certain levee rights-of-way for flood-control work; to the Committee on Flood ControL By Mr. CARTER of Wyoming: A bill (HJl. 6589) provid- ing for the suspension of smnual assessment work on mining claims held by location in the United States and Alaska; to the Committee on Mines and Mining. By Mr. SABATH: A bill (HJl. 6570) to authorise the Re- construction Finance Corporation to make loans to certain public-school districts; to the Committee on Banking and Currency. By Mr. McSWAIN: A biU (HJl. 6571) to amend the act of May 22, 1928, "An act to authorize the collection, in monthly installments, of indebtedness due the United States from enlisted men, and for other purposes "; to the Committee on Military Affairs. Also, a bill (HJl. 6572) to provide relief for disburising officers of the Army in certain cases; to the Committee on Military Affairs. By Mr. EICHER: A bill (HJL 6573) to authorize the Sec- retary of War. upon the recommendation of the Chief of Engineers, to adjust, settle, and pay claims of drainage dis- tricts and levee districts for damages on account of Increased seepage and/or increased cost of drainage resulting from certain improvements on the Mississippi River; to the Cmn- mittee on Claims. By Mr. McDUFFIE: A bill (HJl. 6574) to make inappli- cable in Puerto Rico and the Virgin Islands certain Federal laws relating to intoxicating liquors; to the Committee on Insular Affairs. By Mr. BRITTEN: A bill (HJL 6575) to authorize the building up of the United States Navy to the strength per- mitted by the Washington and London Naval Treaties; to the Committee on Naval Affairs. By Mr. ELLENBOOEIN: Resolution (H.Res. 212) to create a committee to make a study and prepare legislation for the establishment of a uniform national old-age pension sjrstem on a contributory basis; to the Committee on Rules. By Mr. MARTIN of Cokirado: Joint resolution (HJJles. 220) to declare a contingent forfeiture of hoarded gold, gold 262 .1 CONGRESSIONAL RECORD— HOUSE January 8 1934 CONGRESSIONAL RECORD— HOUSE 26S coin, or gold bullion: to the Committee on Banking arjd Currency. , By Mr. SANDERS: Joint resolution (H.JJles. 221) pre - posing an amendment to the Constitution of the Unit^ States; to the Committee on the Judiciary. PRIVATE BILLS AND RESOLUTIONS Under clause 1 of rule XXn. private bills and resolutions were introduced and severally referred as follows: By Mr. ARNOLD: A bill (H.R. 6576) granting a pension to Lavinia McDonald Beard; to the Committee on Inval d Pensions. Also a bill (HR. 6577) granting an increase of pension o Martha D. McCabc; to the Committee on Invalid Pensiors. By Mr. CARMICHAEL: A bill {H.|l. 8578) lor the reli;f of Gordon McGee; to the Committee on Military Affairs. By Mr. CRAVENS: A biU (H.R. 6579) granting a pension to Julia Pitts; to the Committee on Pensions. By Mr. DUNCAN of Missouri: A bill (H.R. 6530) for the relief of Joseph J. McMahon; to the Committee on Milita:y Affairs. By Mr. FLETCHER: A bill (H.R. 6581) granting an in- crease of pension to Rachael A. Updegraff; to the Committse on Invalid Pensions. By Mr. HOLMES: A bUl (HJl. 6582) placing Cadet Adrian Van Leeuwen on the retired list; to the Committee on Mil- tary Affairs. By Mr. LUCE: A bill (HJl. 6583) for the relief of Willian J. Wheian; to the Committee on Naval Affairs. By Mr. LUDLOW: A bill (H.R. 6584) granting an increaie of pension to Rebecca A. Wood; to the Committee on Invalid Pensions. By Mr. MALONEY of Connecticut: A bill (H.R. 6585) for the relief of Robert R. Prann; to the Committee on Claims. By Mr. MEAD: A bill (HJl. 6586) for the relief of Howaj d W. Cliadderdon; to the Committee on Naval Affairs. By Mr. MILLER (by request) : A bill (HJl. 6587) for tlie relief of Hiram Sutterfleld ; to the Committee on Claims. By Mr. MOTT: A bill (H.R. 6588) granting a pension jo Lemuel T. Wilson; to the Committee on Pensions. I By Mr. McCORMACK: A bill (HJl. 6589) for the reliif of Joseph Peter Joyce; to the Committee on Naval Affairs Also. a*bill (HJi. 6590) for the relief of Clarence Herbert Peltier; to the Committee on the Judiciary. Also, a bill (HJR. 6591) for the relief of Francis Lou^ Nourse; to the Committee on Naval Affairs. By Mr. McLEOD: A bill (H.R. 6592) for the relief of LouM Norton; to the Committee on Military Affairs. Also, a bill (HJR. 6593) for the relief of Thomas DeManlgold; to the Committee on Military Affairs. By Mr. REECE: A bill (HJl. 6594) granting a pension John C. Jones; to the Committee on Pensions. Also, a bill (HJfl. 6595) granting a pension to Venia Mood^; to the Committee on Pensions. By Mr. REILLY: A bill (HJl. 6596) for the relief of M^J Lester L. Lampert; to the Conmiittee on War Claims. . Also, a bill (HJl. 6697) for the relief of A. White; to tlie Committee on Claims. Also, a bill (H.SL. 6598) for the relief of the West Bedd Brewing Co.; to the Committee on Claims. By Mr. SUMNERS of Texas: A bill (H.R. 6599) for tHe relief of Joseph E. Moore; to the Committee on Claims. By Mr. THOMASON: A bill (HH. 6600) granting a per slon to Ellsha Wilson; to the Committee on Pensions. By Mr. WEST of Ohio: A bill (HJl. 6601) for the relief of 2d Lt. Charles E. Epson; to the Committee on Milita^ Affairs. By Mr. WILCOX: A bill (HJl. 6602) for the relief 4f Aurora Booth; to the Committee on Claims. PETITIONS, ETC. Under clause 1 of rule XXIT. petitions and papers weie laid on the Clerk's desk and referred as follows: 1491. By Mr. BAKEWELL: Resolution of the Departmeit of Connecticut. United Spanish War Veterans, for the reei actment of. the laws granting benefits to Spanish War, Philippine insurrection, and China relief expedition veterans, their widows and dependents, which were repealed by the passage of the Economy Act; to the Committee on Appro- priations. 1492. Also, petition of Connecticut Branch. No. 29. Na- tional Rural Letter Carriers* Association, protesting against discrimination against rural carriers in the application of the so-called "Economy Act"; to the Committee on the Post Office and Post Roads. 1493. Also, petition of the National Association of Special Delivery Messengers, praying for a change in their present status as Government employees so that they may have a civil-service standing with a living wage; to the Committee on the Post Office and Post Roads. 1494. Also, petition of the National Federation of Post Office Clerks, Local No. 240, of Stamford, Conn., and others, praying for the restoration of pay standards for all Gov- ernment workers reduced by the so-called " Economy Act "; to the Committee on Appropriations. 1495. Also, resolution of the Chamber of Commerce of Clinton, Conn., expressing confidence in the President's en- tire recovery program, including any readjustment of the prevailing monetary system necessary to complete his na- tional recovery program; to the Committee on Coinage, Weights, and Measures. 14S6. By Mr. CARTER of Wyoming: Memorial of the Twenty-second Legislature of the State of Wyoming, me- morializing Congress of the United States to establish a Fed- eral land-bank district composed of Intermountain States; to the Committee on Banking and Currency. 1497. By Mr. CUMIiIINGS: Memorial of the Senate of the State of Colorado, memorializing Congress to enact legis- lation restoring to the people of the United States the bi- metallic monetary system of coinage; to the Committee on Coinage, Weights, and Measures. 1498. Also, petition of the Twenty-ninth General As- sembly of the State of Colorado, commending and praising the monetary policies already adopted by the President and it hereby respectfully requests and urges the President to continue his present gold-purchasing plan and to add thereto a similar plan of silver purchases, and, if found feasible, to bring about the remonetization of silver and its free coinage at some reasonable ratio with respect to the gold dollar; to the Committee on Coinage, Weights, and Measures. 1499. By Mr. FORD: Petition of Spanish -American War veterans, asking for restoration of pensions, hospitalization, and same care as existed prior to enactment of Public, No. 2, Seventy-third Congress; to the Committee on Appropria- tions. 1500. By Mr. LAMBERTSON: Resolution adopted at the regular meeting of the Francis Willard Union, Woman's Christian Temperance Union, Leavenworth, Kans., urging favorable action on the Patman motion picture bill, H.R. 6097. providing higher moral standards for films entering interstate and international commerce, signed by the presi- dent, Mrs. Harriet Shelby, 712 Chestnut Street, Leaven- worth, and its secretary, Jennie Shields, of Leavenworth, Kans.; to the Committee on Interstate and Foreign Com- merce! 1501. By Mr. LINDSAY: Petition of Conservation Depart- ment, State of New York, Albany, favoring the so-called " duck stamp bill ", KM. 5632 and S. 1658, and recommend- ing its passage; to the Committee on Agriculture. 1502. Also, petition of New York State Historical Associa- tion, proposing a Nation-wide celebration of the one hun- dred and fiftieth anniversary of the Federal Constitution in 1937; to the Committee on the Library. 1503. Also, petition of County Editor Publishing Co.. Inc., Staten Island, N.Y., concerning taxation of sphrits; to the Committee on Ways and Means. 1504. Also, petition of Marine Corps League, New York Detachment No. 1, Brooklyn. N.Y., recommending increase in personnel and advancement in the commissioned ranks- to the Committee on Military Affairs. 1505. Also, petition of Chamber of Commerce of the State of New York, New York City, recommending a reducUon in expenditures and enactment of additional tax laws necessary to bring about a balanced Budget; to the Committee on Ways and Means. 1506. By BCr. PARBXR: Petition of W. M. Burton, and other citizens, of Wayne County, Oa., asking the continua- tion of the Crop Production Loan Office to assist small farmers in financing their crops; to the Committee on Agriculture. 1507. Also, petition of citizens of Chatham County. Ga., asking the Federal Congress to enact legislation granting pensions tb the aged and indigent citizens of the Nation; to the Committee on Pensions. 1508. By Mr. RUDD: Petition of Marine Corps League. New York Detachment No. 1, 16 Cotut Street, Brooklyn. N.Y., favoring the strength of the Marine Corps be increased by 2,000 and that promotion of officers be made more rapid commensurate with the length of service; to the Conunittee on Naval Affairs. 1509. Also, New York State Historical Association, propos- ing Nation-wide celebration of the one hundred and fiftieth anniversary of the Federal Constitution in 1937; to the Com- mittee on the Library. 1510. Also, petition of the New York State Conservation Advisory Council, favoring the passage of the so-called " duck stamp bill ". HJl. 5632 and S. 1658; to the Committee on Agriculture. 1511. Also, petition of Chamber of Commerce of the Bor- ough of Queens. City of New York, favoring certain amend- ments to the Securities Act of 1933; to the Committee on Banking and Currency. 1512. Also, petition of Chamber of Commerce of the State of New York, favoring a reduction in expenditures so far as practical and the enactment of additional tax laws to bring about a balanced Budget; to the Committee on Ways and Means. 1513. By the SPEAKER: Petition of H. P. J. Ravn, regard- ing claim in petition of December 6, 1933; to the Committee on Claims. HOUSE OF REPRESENTATIVES Tuesday, January 9, 1934 The House met at 12 o'clock noon. The Chaplain, Rev. James Shera Montgomery, DJD.. offered the following prayer: We praise Thee, gracious God, for Thy goodness and mercy are as fresh and new as the breath of the early morning! Continue the golden breezes to blow tenderly from the slopes of the upper hills. Our hopes, our yearning spirits, our unspoken prayers, and our quivering silence look up to Thee. We own our weakness and our failures. As we come, make the rapture and ijeace of soul real and let us find Thy yoke easy and burden light. Almighty God, the great drama of our country's life roUs on. Let come out of heaven a hand clearing; pointing, and inspiring the way, lifting our whole national being to the highest level of brotherly cooperation. Hear us, blessed Lord; fill all lives with a nobly sustain- ing gladness and all breasts with a trustful patriotic song. Amen. The Joiunal of the proceedings of yesterday was read and approved. THK DISTRICT OF COLUIIBIA LIQUOR BILL Mrs. NORTON. Mr. Speaker. I move that the House re- solve itself Into the Committee of the Whole House on the state of the Union for the consideration of the bill (HJl. 6181) to control the manufacture, transportation, possession, and sale of alcoholic beverages in the District of Columbia; and pending that, I ask unanimous consent that general debate be limited to 2 hours, one half to be controlled by the gentleman from New York [Mr. Stalkkr] and one half by myself, and that general debate be confined to the bill. The SPEAKER. Is there objection to the request of the lady from New Jersey? Mr. BLANTON. Reserving the right to object. Mr. Speaker, the unanimous consent that was granted for taking up this bill provided that It should be taken op under the general rules of the House. I have no dl8po8lU<»i is any way to delay the consideration of the bilL I do, however, want 10 minutes In which to discuss the bUL My position against all such bills is well known to my colleagues, and with the assurance of the good lady of New Jersey that I shaU be given that time. I shall not object. Mrs. NORTON. I shall be glad to yield to the gentlemaa the 10 minutes. Mr. BLANTON. Then I have no ofatfecti<»i to the request to thus limit debate. The SPEAKER. Is there objection to the request of the lady from New Jersey that the general debate be limited to 2 hours, one half of the time to be occmried by her and the other half by the gentleman from New York, and that debate be confined to the bill? There was no objection. The motion of Mrs. Norton was then agreed to. Accordingly the House resolved itself into the Committee of the Whole House on the state of the Union, with Mr. Johnson of Oklahoma in the chair. The CHAIRMAN. The House is in Committee of the Whole House on the state of the Unicm for consideration of the bill HJl. 6181, which the Clerk will report. The Clerk read the title of the bllL Mrs. NORTON. Mr. Chairman, I ask unanimous consent that the first reading of the bill be dispensed with. The CHAIRMAN. Is there objection? lliere was no objection. Mrs. NORTON. Mr. C^iairman. the Committee on the District of Colimibia. to which this bill was referred, held joint hearings with the Senate committee on the bill and invited the citizens of the District to present their views. After careful consideration of all the facts presented, your committee has prepared a bill which it considers a very good one to control the sale of beverages in the District of Columbia. The desire of your committee ti to pass a law which will return a fair amount of revenue to the District and at the same time safeguard the interests of the people as well as the property interests within the District. It also is the desire of the committee to discourage the use of hard liquor by remitting the tax on light wines and beer and in this manner serve the cause of temperance. The purpose of this bill is to permit the sale of alcoholic beverages in the District of Columbia under a licensing S3rstem. It is therefore necessary to repeal the National Prohibition Act and the acts supplemental to and amenda- tory thereof insofar as they affect the District of Columbia, which is accomplished in section 1 of this bill, with the exception of section 4 of the National Prohibition Act inso- far as It affects denatured alc<^ol and title in of said act, relating to industrial alcohol. Section 2 of the bill limits Its operation to the District of Columbia and prohibits delivery of alcoholic beverages out- side the District of Coliunbia in violation of the law of the place of delivery. Section 3 contains definitions. The most Important defi-, nitions are those relating to clubs, hotels, and restaurants, these definitions being Intended to preclude the issuance of licenses to hotels, restaurants, and clubs which are not bona fide establishments. Section 4 of the bill provides for the appointment of an alcoholic beverage control board by tiie Commissioners of the IMstrict of Columbia. Said board is to consist of three persons, at least one of whom shall be a woman and all of whom must be residents of the District of Columbia for at least 3 years immediately preceding his appointment. The salary of each of the members of the board is fixed at $6,000 per annum. The terms of the members are to be for 4 years, the persons first appointed for 2, 3. and 4 years, re- spectively. This section also provides for the employment of other personnel and the payment of expenses of the board. The members of the board may be removed by the Commis- sioners only for cause and after service of written charges and an opportunity to be heard thereon. 264 Section 5 prohibit any member or employee of the boar( from having any interest in the Uquor business. Section 6 gives the board full power to issue, transfer, an( i revoke aU licenses, with an appeal to the Commissioners o the District of Columbia in the case of a revocation of u license. Section 7 confers upon the Commissioners broad powers to control end regulate the business of seUing alcohol!; beverages in the District of Coliunbia and for the issuance , transfer, and revocation of licenses. Section 8 exempts from the opsration of the act prepara ■ tions manufactured for nonbeverage purposes. Section 9 prohibits the manufacture, sale, or solicitation for sale of alcoholic beverages without a license so to do. Section 10 provides for the issuance of licenses to in- dividuals, partnerships, or corporations, but not to unincor- iwrated associations. Section 11 provides for 11 kinds of licenses: (a) Manufacturer's license, class A, to operate a rectify- ing plant, a distillery, or a winery. The annual fee ior th ; rectifying plant is fixed at $2,000. for the distillery at $2.00( . and for the winery at $500: provided that if a distillery is licensed for the manufacture of alcohol and more than 53 percent of such alcohol is sold for nonbeverage purposes, thje annual fee shall be $1,000. (b) Manufacturer's license, class B. to operate a brewer:'. The azmual fee for such license is fixed at $2,500. (c) Wholesaler's license, class A. focr the sale of all alco- holic beverages to other licensees for resale and for the sale of beer and light wines to consumers. Such a licensee, ex- cept a wholesale druggist or wholesale grocer, is prohibitei from engaging in other business on the premises except ths sale of alcoholic and nonalcoholic beverages. The annual fee for this hcense is fixed at $1,500. (d) Wholesaler's license, class B, to sell beer and light wines to other licensees for resale and to consumers. The annual fee for such license is fixed at $750. (e) Retailer's license, class A. to sell all alcoholic bever- ages to consumers for consumption off the premises. Th» annual fee for such license is fixed at $750. (f) Retailer's license, class B, for the sale of beer an 1 light wines to consumers for consumption off the premise!;. The annual fee for such license is fixed at $100. (g) Retailer's license, class C, issued to bona fide restau- rants, hotels, or clubs or a passenger-cairying marine ve35( 1 serving meals for the sale of spirits, wine, and beer for con- sumption only on the premises. Spirits and wines, except ligl t wines, may be sold or served only to persons seated at publ; c tables, and beer and light wines may be sold and served only to persons seated at public tables or bona fide lunch counter >. except that spirits, wine, and beer may be served in a pr - vate room if such room has been approved by the boanl. In the case of hotels and clubs, beverages may also be servt d in the private rooms of guests. The annual license fee for a restaurant is $500; for a hotel under 100 rooms. $500; for a hotel of 100 or more rooms, $1,000; for a club, $250; for a marine vessel, $50 per month or $500 per annum. (h) Retailer's license, class D, to be issued to bona fie e restaurants, taverns, hotels, clubs, or passenger -carrying irn - Tine vessels to sell beer for consiunption on the premises. The annual license fee is fixed at $200. T7aaTrkXT^T 'DT?rr\T>T\ unTTQF. Jamttary Q 1934 CONGRESSIONAL RECORD— HOUSE to the other. Under this bill, there will be hundreds of • whisky saloons an over Washington. This bill prevents bars and brass rails, but the places where this hard liquor will be sold will, nevertheless, be saloons. You will find again hundreds of oldtime saloons existing here in Washington. This bill ought not to be passed. In my humble opinion It is a disgrace to the Nation's Capital, but there Is no way on earth to stop its passage here today. Those who believe in raising the youth of the land up in temperance are going to have to start all over again from the very foundation and build up. It is not something that can be done in a year or in 10 years. It is something that, to be done right, will take years and years to accomplish. We are going to have to educate the new generation over again on this subject. We are going to have to teach the boys and girls ol America in the schools that in the railroad business no rail- road man can drink and hold his job. We are going to have to teach the youth of this land that when they apply to banking institutions in this country for jobs they must show a clean record that they do not drink. We are going to have to teach the children in the schools that if they expect to hold jobs of impc»-tance with the leading business men of this Nation, they must stay away from strong drink. The politicians will learn again in time to come that when they ask the electorate to go into the solemn booth and cast their ballots for them, they are going to have to assure the electorate that they are sober men, that they abstain from strong drink, that they do not attend saloons, if you please. That time is not here now, but it will come again, surely hi the next 20 years. Therefore, just now, Mr. Chairman, when we carmot stop its passage, I do not butt my head against a stone wall in an effort to defeat a bill when noth- ing by such effort could be accomplished. What is there about this bill from an economic standpoint that ought to appeal to every Member of this Congress to oppose it? Why should you create a board here of three members, a liquor board, and pay them salaries of $6,000 each per aimum? In my State, the great State of Texas, the circuit judges, if you please, who try men for their lives, who try cases daily involving millions of dollars of property right, who pass upon the domestic rights of fami- lies, get $4,000 a year, and in the last 2 years the legislature has decreased the salaries of these circuit judges from $5,000 to $4,000 a year. The people demanded such de- creases. Appeal judges in my State, the judges on the courts of appeal, do not now get $6,000 per year. Why should you pay these three members of a liquor board here $6,000 a year each? Why do you not put a limitation in this bill that will pay them not more than $3,000 and that will stop the payment of salaries above $6,000 to some of the employees of the board? When you say that the salaries of their employees shall be fixed by the Classification Act of 1923, you provide the possibility that some ordinary clerks working for this $6,000 board wUl be called " directors " or *' superintendents " or " chiefs " of this or that, and who under the Classification Act of 1923 are going to receive 6. 7, 8, and 9 thousand dollars per year. Now is the time to stop provisions like that; now is the time to amend provisions in a bill like that. I have made so many efforts to stop these increases that it almost seems futile. We go along and let committees bring in these bills that are prepared by bureau chiefs who look out for their own, who write the language in there that takes care of their own salaries and emoluments, and the country does not know that this Congress by the act of 1923 gave up the power and control over the salaries of employees of this Government and turned that over to the employees them- selves. The people do not know that, but it is the truth. Seventy-nine thousand employees of this Government live in Washington — most of them splendid men and women from the 48 States of the Nation. Some of them are 3,000 miles away from home. Some of them are young women, some of them are young men — daughters and sons of good mothers back home who are looking to us to surround them with proper environment here in the Nation's Capital, and yet we are going to inxt a saloon around the comer ftom every one of them. Can you answer that when you go back home? They say that there are 11 kiXKls of Iloenaes In this bill, and there are. There are 2 kinds of manufacturing licenses, 3 kinds ot wholesale licenses, and there are plenty of retail licenses in the bill. Some of them permit only beer and wine to be sold, and you cannot sell it to anjrone under 18 years of age. Let me quote Just a few excerpts from the bill: " Table " BbaU not Include a coxinter, bar, or similar ooa- trivance. Hie salary of each of the members of the board shall be t6,000 per annum. The CommlsBloners are authorlxed to employ such other personal services, indudlng three additional Mslstant corporation cotinsels, as may be necessary to carry out the pro- Tisions of this act and to provide for the expenses of the board. The salaries of employees, other than members of the board, shaU be fixed in accordance with the provisions of the Classifi- cation Act of 1923. as amended. * * * Licenses issued hereimder shall not authoriae the sale or dellTery of beverages, with the exception of beer and light wines, to any person under the age of 21 years, or beer or light wines, to any person under the age of 18 years * * *. No person shall be intoxicated while in charge of or operating any locomotive or whUe acting as a condiictor or brakeman of a car or train of cars, or whUe in charge of operating any stre«t car, elevator, water craft, or horse-drawn vehicle In the. District of Colxuibia. * * * said q)iritB shall be sold or served only to penons seated at public tables. Mr. MAY. Will the gentleman yield? Mr. BLANTON. Certainly, always to my good friend the distinguished Jurist fnmi Kentucky. Mr. MAY. Does this bill repeal the provision in the Democratic platform which declared against the open sa- loon? There is a little provision here whi^ sajrs that their shall not have a bar and a brass rail. Mr. BLANTON. No bars and no brass rails, but " saloons " they are just the same. Mr. PATMAN. They must sit down. Mr. BLACK. They have to sit on the brass rail. Mr. BLANTON. They have to sit on the brass rail, it they have a brass rail, while they drink. To be convivial and social they must sit down to it. Mrs. NORTON. Will the gentleman yield? Mr. BLANTON. John and the rest of us used to like to be convivial standing up as well as sitting down. Mr. McCORMACK. I prefer to stand up. The CHAIRMAN. The time of the gentleman from Texas has expired. Mrs. NORTON. I yield to the gentleman from Texas S additional minutes. Mr. PATMAN. Will the gentleman yield? Mr. BLANTON. I yield. Mr. PATMAN. May I suggest that the only difference between the saloon under this bill and the saloon under the old system is that in order to be served a drink in one of the new saloons you must sit down at a table? But iX you wish to be served with high wines and beer you can be served at a counter, but you must be sitting and you may put your feet on the brass ralL Mr. BLANTON. Oh, yes; that is the legal distinction be- tween this saloon tweedledum and tweedledee. [Laughter.] Now. there are Ucenses in this bill that will permit you to buy it standing up. A young boy or a young girl, if 18 years old. can buy beer and wine, and Just as soon as they reach 21 they can go to some ot these special saloons and buy package goods by the case and take it home, around the comer, and debauch all night if they want to. Mr. SIROVICH. Will the gentleman yield? Mr. BLANTON. I yield. Mr. SIROVICH. How did they do it under prohibition, with the speak-easy? Mr. BLANTON. Doctor, you are one of the strong advo- cates of strong drink in the Nation who does not drink him- self, who speaks regularly from this floor for strong drink. I do not see how in the world a man who does not drink himself wants to put this stuff down the guzzle of some* body else. [Laughter and Appiaust.} «l \ i I 266 CONGRESSIONi lL RECORD— HOUSE January 9 The time of the gentleman from Tekas The CHAIRMAN, has again expired. I Mr. STALXER. Mr. Chairman, I believe the proposed pill Is perhaps as good a license bill as could be drafted, but due to the fact that the eighteenth amendment has been re- pealed on account of the promises made by both psrty platforms, and oft repeated by the President oi the United States that the saloon would not return, it seems to me tpat any license system whereby intoxicating liquors are per- mitted to be sold by the drink does return the saloon iind will be so considered by a large majority of our people. At this particular time there is another outstanding lea- ture. namely, the poor quality of liquor to be put on the American market on account of the fact that we have px ac- tlcally no aged liquor in stock, and the distillery and rect f y- ing interests have so manipulated, by securing nearly all of the licenses for importation of foreign liquors that ttiey will be able, to a large extent, to prevent the uncut f or< ign liquors from reaching our markets. On account of the in- standardized quality of the liquor that will be sold by the drmk in an imusuaUy large number of licensed places in the District of Columbia, we can look for an excessive amount of intoxication by its unrestricted use. and I believe the only safeguard is to have a dispensary system so rig dly controlled that no hard liquors can reach the consu^ner except through stores controlled by the liquor board, fend a provision should be written into this bill prohibiting any liquor to be sold until it has passed a chemical test by [the board of chemists. Under such a plan liquor can be sol< I in package form for consimiption in the homes so much cheaper than it can be sold by private parties that it will go a long way toward eliminating the bootlegger and the speakeasy. At the same time, the Goverimient can denve more revenue from it, and the profits that would otherwise go to the wholesaler and retailer will be reflected in the lower price of liquor to the consumer. I do not believe any license system can be drafted that will successfully prevent the retail dealer from selling boo;leg liquor in place of tax-paid liquor. Therefore, the revenue that would be derived through any licensing system wculd be very small indeed. I am opposed to this bill because it provides for the ret urn of the oldtime saloon. It repudiates the platforms of toth of the major parties. Even the so-called '.' wet organ za- tions " are opposed to this bill in its present form. Dr. P. W. Buck, chairman of the joint elective legislative com- mittee of 12 antiprohibition organizations, stated that inl his (H)inlon the enactment of this bill would lead to a reacjion against the liberalization of the liquor laws and resuli in lu-Qhibitory laws being reenacted within a very few yeaip. This bill should be recommitted to the District of Coli im- bla Committee, with the recooomendatlon that a dispensary system be substituted Mr. Chairman. I yield 20 minutes to the gentleman f^om Texas, Mr. Patman. SO-CALUED " HODEL LIQ0OK BILI. Mr. PATMAN. Mr. Chairman, in considering this bill Members of Congress sit as a State legislature to pass upon this legislation. This bill has been referred to as a model bill, which will be considered by all the 48 States of the Nation when they are considering legislation for the sali ! of Intoxicating beverages in those States. It was said before the committee that the reason we she uld be careful with this legislation is because it will be poii ted to as a model bill, and further that many Members of C an gress desire to be very careful about the kind of bill t ley vote for the first opportunity they have to vote on \his question after the repeal of the eighteenth amendment. DKMOOL&TIC PLATTOKM OF 1932 The Democratic platform of 1932 contains this provliion as a recommendation to the States after repeal, and of course, the District of Columbia is in the same categorjf as a State. That platform provides this: We urge the enactment of such me«surea by tlie several Stktes M wUl actxially promote temperance, effectively prevent the return of the saloon, and bring the liquor traffic Into the open, under complete supervision and control by the States. Now, let us not overlook those three points. The first is a bill that will actually promote temperance; second, one that will effectively — do not overlook that word " effec- tively " — one that will effectively prevent the return of the saloon; third, one that will bring the liquor traffic out into the open. VIOLATION OF DEMOCRATIC PLATFORM Now, let US examine this bill that is before the House and see if it comes within the requirements of the Democratic platform — and the Republican platform was equally as rigid. This bill gives the hotels and restaurants a monopoly. The hotels are especially favored. Let us see what the practical effect of this bill will be when it is passed and when it has become a law, if it is enacted into law. First, there will be two places in the District of Columbia which can obtain licenses to sell alcoholic bever- ages; that is, beer, wine, whisky, cordial, or anything else of high alcoholic content or low alcoholic content. They can sell everything. They can sell it by the drink. Those two institutions are hotels and restaurants. They are not re- quired to serve meals with it. They can sell it with or with- out meals. They can sell it at any time to any person who wants to buy it in any amount that he desires to buy, and he can consume it there where he makes the purchase. Your constituents will be required to carry their small children into a bar room for meals. They cannot stop in a hotel that is not a saloon. Now, there is a difference between a hotel and a restau- rant under this bill. I hope the distinguished lady from New Jersey will give me attention here. HOTELS FAVORED If I am wrong I want to be corrected. Under this bill a hotel will be permitted to sell alcoholic beverages by the drink. Under this bill a hotel will also be permitted to sell alcoholic beverages in sealed packages, not one pint, one quart, but one keg, or one barrel, or even more. This is the great privilege of a hotel under this bill. No other establish- ment in the District of Columbia will be permitted to sell it this way. The nearest approach to it will be the restaurant. The restaurant will be permitted to sell it by the drink only and will not be permitted to sell it in sealed packages. There will be other places which will be allowed to sell it in sealed packages only, but the hotel is the only place that can sell it by the drink and in sealed packages. The other establishments are restricted either to sealed packages or, in the case of the restaurant, by the drink. Mr. PALMISANO. Mr. Chairman, will the gentleman yield? Mr. PATMAN. I yield. Mr. PALMISANO. Does the gentleman wish to convey the thought that he is in favor of permitting the tavern and other restaurants to sell also by the package? Mr. PATMAN. I am saying that in this biU there Is a tendency toward a monopoly in the sale of alcoholic bev- erages. Mrs. NORTON. Mr. Chairman, will the gentleman yield? Mr. PATMAN. I yield. Mrs. NORTON. Of course, the gentleman understands a hotel pays a very much higher license. Mr. PATMAN. Yes; but the license provided in this bill is insignificant. There are few hotels in the District of Columbia which can qualify under this bill. It is true that at first the number of rooms were placed at 50 and that now an amendment is proposed which will reduce the num- ber of rooms to 30, but even so the number of hotels which can qualify in the District will be very small. Mrs. NORTON. It will take care of a legitimate hotel, at any rate. Mr. O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. PATMAN. I yield, Mr. O'CONNOR. Do I understand the gentleman to say that a hotel may sell it to be taken off the premises? Mr. PATMAN. Absolutely. 1934 CONGRESSIONAL RECORD— HOUSE 267 Mr. O'CONNOR. Of course, I am not in sympathy with that at all. I believe a safeguard should be put in the bill compelling liquor sold by a hotel to be consumed on the premises. Mr. PATMAN. The hotels are favored in this way under this bill, that they can sell it by the drink and also in quan- tity, as they desire, either for consumption on the premises or to be taken off the premises in sealed packages. There would be no way for a hotel keeper to enforce a law re- quiring that liquor delivered in sealed packages must be consumad on the premises. Mr. O'CONNOR. It might be safeguarded by bringing knowledge home to the hotel and making it an offense if they have knowledge that it is being taken off the premises. Some such proviso should be inserted in the bill. BIU. DOES NOT PROMOTE TEMPEKANCE Mr. PATMAN. Nothing in the bill at present requires it, and if there was it could not be enforced. Let us see, first, if in this bill there is anything to promote temperance. Ordinarily you would think, in order to pro- mote temperance, there should be a requirement that would not encourage the sale of alcoholic beverages. There is nothing in this bill which restricts advertising, either over the radio or in the newspapers, for the purpose of encourag- ing the use of hard liquors. In other words, there is nothing in this bill to promote temperance, at lesLSt not in this respect. DOES NOT ETTECTTVELT PREVENT RETITRN OF SALOON Next, let US see if it meets the test of effectively preventing the return of the saloon. How much difference will there be between a place where intoxicating beverages are sold under this bill, and the old saloon? It will sound ridiculous to you when I tell you, but it is the absolute fact. Mrs. NORTON. Mr. Chairman, will the gentleman jrield? Mr. PATMAN. I yield. Mrs. NORTON. I call the gentleman's attention to page 18 of the bill, line 19, specifically the following language: Beer at the place therein described for consumption only In said place — Spirits, wine, and beer. Mr. PATMAN. The gentlewoman evidently must have a bill different from the one I have. I have the bill KM. 6181, and I invite the gentlewoman's attention to line 7 on page 18 of the bill under the heading " Retailer's license, class B ", where it is stated that such a license shall authorize the holder thereof to keep for sale and to sell spirits, wines, and beer at the places I have described for consumption only in said place except in the case of clubs and hotels no beverage shall be sold or served to a customer in a closed container. Mr. MAY. Mr. Chairman, will the gentleman yield? Mr. PATMAN. I yield. Mr. MAY. Under the provisions of the bill to which the gentleman refers, may not any particular place where liq- uor is sold be designated as a club? May not some tempo- rary arrangement be made by which it shall be known as a club and thereby escape the restrictions against it? Mr. PATMAN. There is a provision in the bill that the club must have been in existence 3 months. I do not know whether it means before the passage of the bill or before it makes application for a license. Mr. BLACK. I hope the gentleman will read the next sentence. GOUUS IS TKAMS OF ACE CAN FTTHCHA8E HASD LXQUOKS Mr. PATMAN. Let us see the further things which may be done. One can go into these establishments and purchase any kind of alcoholic beverage he or she desires. In the case of a man he must be 21 years of age. In the case of a woman she must be 18 years of age in order to go into this place and purchase any kind of alcoholic beverage desired. Under the old system there was a counter with a bar and a brass rail. Customers could stand up and drink. irOBT SIT DOWN TO BK SEBVZO Under this new system the only difference on earth is that they are not permitted to stand at the bar; they must go to a table and sit down and have the perambulating bar come up to them and serve them at the table. There is nothing in this bill to prevent the perambulating bar you have heard and read so much about in the newspapers lately. Therefore, the only difference is that under the old saloon system one could stand up and drink, whereas under the system provided in this bill one must sit down in order to be served. I want to ask you. candidly, if you think this is enough difference to Justify us in saying we have effectively in«- vented the return of the saloon? Mr. McFARLANE. Mr. Chairman, will the gentleman yield? Mr. PATMAN. I yield. Mr. McFARLANE. It is true, is It not. that in niin<^ they are already advocating the abolition of drinking sitting down? Mr. PATMAN. If I am not correct in this statement, I hope any member of the committee, or any Member of this House, will get up now and tell me so. But I am right about it. The only difference is that one must sit down; and I want to ask you if this is enough to effectively pre- vent the return of the saloon. Mr. OLIVER of New York. What does the gentleman suggest — that one should not be allowed to drink at all. either sitting up or standing down? STOOLS TOa. THS BAES Mr. PATMAN. That is not the material point at all. I am Just pointing out what the difference is. Frankly, I think it is just the same as the old saloon system and that it does not effectively prevent the return of the saloon. Now, in the case of wines and beer of any alcoholic content they can be served at a bar or at a counter except they must sit down on a stool if they are served at the bar or the counter. But in order to be served cordials and whlskys they must sit down at a table. This is the only difference on earth between the old saloon and the ss^stem now advo- cated by this Committee for the District of Columbia. Can you say that that Is a sufficient difference for you to go back to your people and tell them that you voted to effectively prevent the return of the saloon, because under the old system they could stand up and drink and you voted for a bill that will require them to sit down in order to drink? Mr. TAYLOR of Tennessee. Would it not be much easier to detect intoxication if a purchaser were standing up than if he were sitting down? Mr. PATMAN. That was mentioned before the committee. Mr. WEIDEMAN. I presented an amendment in the committee that would make all hard-liquor drinking occur on the first floor of buildings and exposed to public view. In other words, I had in mind the plank of the Democratic Party that we were against the return of the old saloon, that we were going to enact a measure to promote temperance and bring the liquor traffic into the open. It is my contention that if you make people drink in the open, where the neighbors can see them, and if you do away with the cabarets on the second floor, bringing the carabets down to the ground floor where they are open to view, you will not have as many children drinking hard liquor as there are now. As far as I am concerned. I believe that In order to pro- mote temperance drinking should be brought out into the open. If there Is going to be "faking" about this situa- tion, in a few years we will be confronted with the same situation we were 15 years ago. The cabaret and the night club have been the outgrowth of bootleg liquor, and :t is that influence I want to abolish. Do you not agree with me that bringing liquor actually into the open as well as theoretically would cut down the intemperate use of it? Mr. PATMAN. That was suggested in the committee. I want to invite the Members' attention to a report that was filed by the District of Colimibia Committee on this bill. I also invite attention to the minority views whi^ I filed, commencing on page 8 at the r^iort. 268 CONGRESSIONAL RECORD— HOUSE January 9 Mr. BANKHEAD. Will the gentleman yield? Mr. PATMAN. I yield to the gentleman from Alal Mr. BANKHEAD. Unfortunately I was called out Chamber and I have not had the benefit of the gentlei statement. May I ask if the gentleman has discussed in remarks any alternative plan for the handling of liquor situation in the District of Columbia? Mr. PATMAN. The committee did not ccmsider an altisr native plan except one that was presented by the gentleman from Virginia [Mr. Smtth] and Dr. Buck, representing he Federal IXspensary League. The Smith plan is that ;he District of Columbia will have stores in which hard liqu ors may be sold. Wine and beer will be sold at any hotel or restaurant or possibly at other places in the District of Columbia. Hard liquors may only be sold in sealed packa ;es by the Government stores. Mr. BANKHEAD. Is it the purpose of those who hold that view to attempt to offer that alternative as a substit ute for the pending bill? Mr. PATMAN. I understand that the gentleman fiom Virginia [Mr. Sjoth] will offer it. I do not know for certi lin. but I presume he will. He insisted upon it in the commit «e. My view is that if we are to. have a dispensary plan we ought to have a plan that will effectively prevent the ret im of the saloon. My further view is that we should rec(m- mit this bill to the District of Columbia Conunittee and let that committee get together, knowing the will of the Hoi ise, and draft a bill that will effectively prevent the return of the saloon. Then the committee can consider all plans t lat may be sponsored by different citizens of the District ox by Members of this House. Mr. REILLY. Will the gentleman yield? Mr. PATMAN. I yield to the gentleman from Wisconsin. Mr. REILLT. Under the dispensary system you wculd drive such drinking back to the home, would you not? Mr. PATMAN. Of course, that is an argument thai is made right along. This biU will not prevent people fiom drinking In the home. That same objection could be ur led against almost any bill that you were considering. Mr. REILLY. Was not one of the evils of the prohibition era that there was too much drinking of hard liquor in home? Mr. PATMAN. I will say to the gentleman that this wiU not prevent them from drinking in the home. Mr. RETT J .Y. They will be compeUed to drink it in home under this bill, will they not? Mr. PATMAN. I do not think so. Mr. DONDERO. Will the gentleman yield? Mr. PATMAN. Yes. Mr. DONDERO. Can the gentleman from Texas give Members any information as to the action taken by several States in regard to the program which they setting up for the handling of liquor? Mr. PATMAN. I understand that many of the States waiting on the District of Colimibia bill; that is, they holding their bills in order to find out what sort of a m^del bill will be passed by the Congress of the United States in order to carry out the Democratic platform pledge to pre^ ent the return of the saloon. They will then consider measures in the various States. Mr. MARLAND. Will the genUeman yield? Mr. PATMAN. Yes. Mr. MARLAND. As you have reminded us. the pledgi of the Democratic side of the House was to prevent the ret im of the saloon. I ask the gentleman if there is anything in this bill which defines a saloon and attempts to prevent it? Mr. PATMAN. No; there is no definition of a saloox In this bill. Neither was there a definition of " saloon " i^en by any witness that appeared before the committee we were hAiliig hearings on the bin. Mr. MARLAND. May I ask the gentleman if we can ▼ent the return of something when we do not know it Is? Mr. PATMAN. Of course, we aU have an idea of our 4wn as to what a saloon Is. Tbe definition is generally knc wu. We do know that there is no difference In what we lad the bill the the the are are are before and what is offered in this bill. The only difference is that the claim is made that under the old saloon they could stand up or sit down, and under this bill they have to sit down in order to be served. That is the only difference. [Here the gavel fell.] Mr. STALKER. Mr. Chairman, I yield the gentleman 2 additional minutes. SniKMBEB THim OBJECTIONS Mr. PATMAN. In conclusion, one of the main points to be considered is, does this bill promote temperance. If it does, I challenge any member of the committee to point out to you where there is anything in the bill that is calculated to encourage temperance. Next, does it effectively prevent the return of the saloon? It does not. It is the old saloon. I repeat, and no one can deny it, the only difference between the old saloon and this new establishment is that under the old saloon system you could either sit down or stand up to be served and under this new bill you have to sit down in order to be served. The next point is, does it bring the liquor traflQc out into the open? It does not. There is no provision in the bill that has for its purpose the bringing of the liquor traffic out into the open. Therefore I submit to you that this bill should be recom- mitted to the Committee on the District of Columbia. [Applause.] Mrs. NORTON. Mr. Chairman, I yield 5 minutes to the gentleman from Ohio [Mr. Harlan]. Mr. HARLAN. Mr. Chairman. I was rather interested and amused at the efforts to make the promise of the Dem- ocratic Party platform to do away with the saloon a logical promise. To my mind it is the one statement in the Dem- ocratic platform that cannot be made a logical, reasonable statement, because, in the first place, as has been suggested, there is no definition of a saloon, and. in the second place, from 010" knowledge of the history of human nature, I do not believe it would be possible to do away with either a saloon or something to take the place of a saloon, as long as we are going to have drinking of alcoholic beverages. There are three classes of people who drink. One is the man who takes liquor for medicine. Another is the psycho- pathic who takes a bottle of liquor and goes off to himself somewhere and drinks to intoxication, and the other class comprises the great b\ilk of j)eople who drink for sociability purposes. This class includes those people who realize or feel that they have in themselves an inhibiting wall about themselves — a product of civilized development that they want temporarily to remove. They wish temporarily to retrograde a little — to let go; to go on the loose. These people gather together in order to know each other better; in order to inculcate a higher degree of sociability, they drink, not to excess, but just for social purposes. They must have some place to do this. It is far better to have it in some place that is under reasonable control than it Is to compel them, as was done during the prohibition era, to go to a hotel and there drink to excess under conditions that the people par- ticipating did not really desire. We can call such a place a saloon or a grocery or a barber shop or anything else, but as long as men drink to promote sociability you will never do away with sociability; you will never do away with some gathering place to drink. You might just as well talk about removing the rear end of a train in order to do away with rear-end collisions. The social gathering place, psychologically, and from the history of the human race, is so much wrapped up in the whole problem of drinking that to do away with one you have to do away with the other, and we have already found out that you cannot do away with the drinking. Mr. WEIDEMAN. Will the gentleman yield? Mr. HARLAN. I am sorry, but I have not the time. Let us just look at this question squarely. We must have some place where people can drink. We do not want to force our young men and young women to go back Into the hip-fiask-totlng era If we can help It. We do not want them to take their bottles home or to some place of hiding and there drink to excess; and if we recognize this common- 1934 CONGRESSIONAL RECORD— HOUSE sense situation, the fair thins and the honest thing and the r nonhypocritical thing to do is to meet it under the best con- ditions of control that we can get. The more foolish, nonsensical regulations we put aroimd it about requiring them to stand up to drink or sit down to drink or, as the gentleman Just said, " to sit up or stand down ". which sounds like a discussion in Alice in Wonderland — ^the more things of this kind we inject or write into the bill the moi-e ridiculous it will be. I know the govenunent-dispensary plan has never worked out according to the desires of the people who have pro- posed it. It has created great political machines and has not been effective in promoting temperance in any way; at least, our experience in the Carolinas has been to that effect. It has not produced temperance, satisfactory revenue, nor reduced lawlessness, and the only sensible way to handle this situation is to operate under the most simple license plan possible; to meet it as it exists and not as we would wish it to exist. [Applause.] Mr. STALKER. Mr. Chairman, I yield 20 minutes to the gentleman from Illinois [Mr. Dirksxit]. Mr. DiRKSEK was recognized. Mr. BLANCHARD. Will the gentleman yield before he begins? Mr. DIRKSEN. I yield. Mr. BLANCHARD. Why is It necessary to establish a separate board, as this bill provides? Mr. DIRKSEN. This board will take the place of the existing board. Mr. BOILEAU. Will the genUeman yield? Ml. DIRKSEN. I will yield. Mr. BOILEAU. Section 5. paragraph (c). provides that no place shall be deemed appropriate if the owners of a majority of the real property within a radius of 600 feet of the boundary object to the granting of a license. Does that hold over for more than a year? Mr. DIRKSEN. That is a matter to be determined largely by the board, because they have been given wide discre- tionary powers in the bill. Mr, BOILEAU. They might make a large investment this year and then the next year have the citizens decide against them. Mr. DIRKSEN. If they managed it in accordance with the requirements of the board, so far as the decorum of the place and the character of the management is concerned, they could probably continue. Mr. BOILEAU. But that might prevent the transfer of property. Mr. DIRKSEN. That is true. Mr. BLANCHARD. This bill provides for a new board of 3 men at $6,000 salary, 3 corporation counsel, and numerous other employees. I should like to know the reason or neces- sity for that. Mr. DIRKSEN. There will be a considerable amount of work; there will be probably upward of 2,000 applications in the District of Columbia, and it will take a large personnel to handle the applications made. Now, Mr. Chairman, I cannot yield further. I listened with a good deal of interest to my colleague from Texas and the other distinguished gentleman from Texas [Mr. BlantomJ, who still frowns upon repeal of the eighteenth amendment, and who would, if he could, imperil the precious fruits of repeal. It may be that Texas does not know that the eight- eenth amendment has been repealed. This is a bill to enable the people of the District of Columbia to get a drink, if and when they want it, under proper regulation. We have seen what prohibition and the effects of restric- tion would do, and so we have here only the queftion of retail principle to consider, and not so much the mechanical provisions of the bill. Do we want to provide liquor for the people of the District of Columbia under a private system, or shall it be dona by the dispensary system? I say, cate- gorically, that I am opposed to the dispensary system. It has not worked out satisfactorily, notably in South Carolina, where they had it for 12 years. Besides it is putting the Government into the liquor business. Until we cone to a state of coQsistencj by taavinf the aovemment take over the distilleries as well as tte outlets. I say that I am opposed to the dispensary system as being half fish and half fowl. Generally speaking, this is designed not only to eliminate the old saloon but also to make it reasonably easy, under proper circumstances, for a man or a woman of legal age to secure a drink of liquor if he or she wants it The argu- ment that this is restoring the saloon is just a lot of hooey. You know what the old saloon was-~a place where they had curtains, a place where they had a back room, a place where men shuffled around in various states of intoxication, a place where men would loaf in the course of the day, sosiking themselves with periodic drinks. Can anyone say that a restaurant, conducted according to all the rules and regula- tions set up in this bill, or a hotel dining room, decorously managed, is in any way analogous to the old saloon? As my distinguished friend from Michigan so aptly put it in the committee, this is designed to take the bend out of the elbow and put it in the knee. Tou are asked to sit down at a table in order to take your drink if you are going to take it by the drink rather than take it in a package to your homes to consume. There is a good reason for that seemingly whimsical provision. The same Dr. Buck, who is the legisla- tive agent of the Tax Reduction League in the District of Columbia, who has been a practicing physician for 33 years, is the same doctor who has made obeenrations for a number of years, and who said that when men congregate at a bar, ordinarily the inveterate drinker will stand there and con- sume three drinks within 15 minutes: and It has been his observation that when a man sits down to a table to drink It will take at least an hour to coosttme three drinks of ardent spirits. There is a certain convlvlaUty, there Is a certain fellow- ship, azul more time elapses; and who can say that sitting at a Uble enjoying fellowihip under decorous surrotmdings is bringing back the old saloon? I think we are in accord with the program of both the Democratic and Republican Parties in this bill, because by no stretch of the imagination can anybody see that the old saloon is being returned. I want to enumerate for the purpose of clarity in a gen- eral way what this bill contains. First of all there is a beverage board consisting of three men. They are to re- ceive $6,000 a year each. You say that that is too much. Oh, well, you can amend the bill and reduce it to $4,000, if you so desire. That is a technicality. This board has been clothed with full administrative and executive power to ex- amine into the character and fitness of the mtfti who make application for on-sale and off -sale licenses and generally to conduct the entire liquor business here through adminis- trative channels. The bill contains also a differentiation between a liquor license and a beer license. In that respect we have followed the Rockefeller Foundation report. The Rockefeller Foun- dation expended a lot of time and money, and, I believe, sent a copy of their report to every Member of the House and Senate, and you will notice they drew a distinction between a license to be issued to a purveyor of beer and a license to be issued to a purveyor of liquor. If you will ex- amine the character of licenses provided for in the bill, you will see that that distinction is very carefully carried out. I allude now, for a moment, to the revenue features of the bill. If I remember the figures correctly, the Commis- sioners anticipate that this biU will raise approximately three quarters of a million dollars per year through all the manufacturing and wholesale and retail outlets for which application may be made. I have already alluded to table drinking. The bill pro- vides aiso for the sale and purchase of package liquor, so that one can go to a grocery store that has an off-sale license or to some kind of a bquor store where they sell liquor by the package and buy what you want and take it to your home and there consume it, if one prefers to do that as distinguished from going to a restaurant or a hot«l dining room for a drink. Nothing has been done about advertising. That raises • very fine point as to whether we should say to the news- j 270 CONGRESSION^ lL RECORD— HOUSE January 9 The bill provides for a meticulous examination of character of the manager of a licensed place as well as papers of the District that under this bill they shall hjave no right to quote the prices of whisky, claret, port, she! Madeira, and all of the other things that are manufacti^ed. I can see no reason for that. If we are giving a cloak of legitimacy to the distiller, to the rectifying business, then why should we seek to penalize a newspaper by precluding it from accepting advertisements and securing that addi- tional revenue? It takes a rather fancy stretch of the imagination to say that an advertisement in a newspaper quoting the price of liquor can be said to encourage the consumption of liquor or that it is at variance with temi tr- ance. the the owner or applicant. If anyone has ever been convicted bt a felony, if anyone, in the estimation of the liquor board, is not of proper character to run this business, no license wil be Issued. That indicates further the amount of adminlsira- tlve authority that has been conferred upon the liduor board. After all, whether it be in the District of Coliuibia or In some State of the Union, the efficacy of the a tration of a liquor control act is going to be nothing niore than a reflection of the personalities of ths men who i are appointed on the liquor board, and when you think of tiiat, in the light of the fact that we are in a rather probatioi lary stage Just now. that this thing is new, that it still presents novel aspects, and that it can be changed at any time by this House, I say, in view of all this, this is the kind of a bill that eliminates undue restriction and gives the people of the District of Coliunbia a right to have a drink under proper surroundings if they so desire. To that little militant, vocal minority on the prohibifion side„ let me say that if they do not like it they do not have to go into a dining room and take a drink, beciuse that is a matter for everybody to determine for himself. I am entirely out of sympathy with the distinguished gentleman from Texas, who Just preceded me, who still seeks to inject dry prejudices after the eighteenth amand- ment has been repealed by the sovereign voice of the pe 3ple of this coimtry. Ono thing more : A question came up In the committe ; as to whether a man should be compelled to go into a diiting room and purchase a meal before he could have a diink. The idea of loading up every drink with a meal wmld make it rather difficult for a man who wanted to toxiy a couple of drinks to secure them without becomingjin- temperate ih his eating. There must be some limit. Tnere must be some exercise of discretion, and above all else i lere must be exercise of common sense. When you view this bill in the Urge, you can see that adequate provision has been made for the protection of the District, for the 9TO' teetlon of the schools and churches, for the protection of the people generally, and at the same time make It posllble for people in an orderly fashion to walk into the dining room 0/ the Shoreham or Wardman Park, or any other nstel in the DIstrlet. and sit down, and there In convivial com- pany secure a drink. Another rather important thing that was written into this bill If the provision that no credit shall be establiihed, or no credit shall be advanced in an on-sale driiiclng emporium for the purpose of buying liquor. The reason for that is this: You can readily understand that a man who might be temporarily out of work and without fundb wants a drink and be goes to an on-sale emporium. He knowi; the owner or proprietor quite well, and he says, " I should lU e to have a drink, but I haven't got any money." Now, t Is conceivable that the proprietor, thinking perhaps he will find a job in a week or two, will extend to him a lire of credit and let him drink up $50 or $60 worth of ardent spirits, that must ultimately come out of the family bu iget, and operate as a penalty upon the wife and children of that family. That has been restricted by the provisions of this bill, insofar as that can be done by legislation. I beieve after all it is the best guarantee against the so-called " s )ak Ing " that was one of the necessary incidents to thq old saloon Mr. KNUTSON. Will the gentleman yield? Mr. DIRKSEN. I yield. Mr. KNUTSON. What does this bill do to a man who comes in and has a drink and announces afterward that he is broke? Mr. DIRKSEN. The distinguished gentleman from Min- nesota just raised the point as to what a man would do if he went in and got a drink and announced his financial embarrassment afterward. It is just one of those things, I should say to the distinguished gentleman from Minnesota, but I assiune that the proprietor or manager of the place would know precisely how to deal with a gentleman like that. Mr. BROOKS. Will the gentleman yield for a question? Mr. DIRKSEN. I yield. Mr. BROOKS. In providing retail licenses for the sale of all brands of liquor, has there t>een any provision m;;de for the purchase of liquor that has had the Government tax * paid, or can a retail dealer sell any kind of liquor? I can- not find where there is any provision made to prevent a retail licensee from selling bootleg liquor. Mr. DIRKSEN. I would say that it is not necessary to make that kind of a recital in the District liquor bill. Mr. WEIDEI'-IAN. Will the gentleman yield? Mr. DIRKSEN. I yield. Mr. WEIDE:maN. There is such a provision In section 36 of the bill, which I addressed to the committee, and it reads as follows: Sec. 36. No rectlfled or blended spirits shall be sold unless the container In which it Is sold shall bear a legible lable firmly a^lxcd thereto stating the nature and percentage of each In- gredient therein, the age of each such ingredient, and the alcoholic content of such spirits by volume. Mr. DIRKSEN. That does not answer the gentleman's question. Mr. BROOKS. No. I want to make sure about this. The bootleggers ere already starting to print that kind of label. I want to know if there is any provision that could be made that v/ould make that liquor justiflsd as having the Govern- ment tax paid by the wholesaler. Mr. DIRKSEN, That recital is not necessary, because that constitutes a violation, under the Treasury regulation. Mr. SAMUEL B. HILL. Will the gentleman yield? Mr. DIRKSEN. I yield. Mr. SAMUEL B. HILL. In the bill that was passed re- cently the tariff provision requiring a stamp to be affixed to the container showing that the tax has been paid would, of course, apply to liquor sold in the District of Columbia, as well as elsewhere. Mr. BROOKS. That would revoke his license? Mr. DIRKSEN. Oh, yes; and it would be a matter of enforcement for the Trcaflury or the Department of Internal Revenue. Mr, MARLAND, Will the gentleman yield? Mr. DIRK01SN, I yield, Mr, MARLAND, X underttand that a patron In a hotel acciutomed to paying his bills once a month, and to signing his dinner check, would have to pay cash for anything he got to drink? Mr. DIRKSEN. I think that is handled by the provision that it shall not operate to prejudice a club member, for Instance. In his right to secure a line of credit in his club. Probably the same thing would apply in the case of a hotel. Mr. WEIDEMAN. If the gentleman will yield, I think the gentleman is misinformed as to the nature of the question which was asked by the gentleman from Pennsylvania [Mr. Brooks]. There is no protection now to either the drinker or the Government on the liquor called " a blend " that is sold in a closed container. In other words, not only in the Dis- trict of Columbia but in the State of Michigan bootleggers are putting out blends, which do not require an internal- revenue stamp, and which we did not remedy by the bill we passed the other day. and which is not protected in this bill. I think that should be called to the attention of the Members of this House. A blend does not require the affixa- tion of a revenue stamp or any kind of a stamp. 1934 CONGRESSIONAL RECORD— HOUSE 271 Mr. BROOKS. That Is exactly what I referred to. Mr. DIRKSEN. I submit to the -gentleman of the Ways and Means Committee as to whether a provision to that effect was also incorporated in the revenue bilL Mr. SAMUEL B. HILL. No such provision was in the revenue bill passed a few days ago. Mr. O'CONNOR. The gentleman recalls that I offered such an amendment and it was ruled out of order. Mr. SAMUEL B. HILL. Yes. I recall the gentleman did offer such an amendment. Mr. O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. DIRKSEN. I yield. Mr. O'CONNOR. What I think the gentleman has in mind is this: What is to prevent the wholesaler — for in- stance, a liquor store — selling goods which have been fur- nished to him by a bootlegger? Of course, if he is doing this, it is unauthorized as far as the board of commis- sioners or control is concerned. Let us have the authority to revoke the license of such a wholesaler. Mr. DIRKSEN. They do. Mr. O'CONNOR. I do not know whether it is specified in the bilL Mr. DIRKSEN. The board has this power, and also the power and machinery with which they can ascertain the source of liquor sales. It is definite, and I think it is ample. Provision is made in this bill to accomplish the purpose the gentleman has in mind. I allude also to the fact that under the old saloon and brewery systems it was quite possible for a brewer to pur- chase, or to lease, any number of parcels of real estate and to establish them as retail outlets for his brewery. One of the recommendations of the Rockefeller committee was that there must be an elimination of the so-called " tied " house; there must be an elimination of the feature whereby the brewer could exercise complete control over the retail out- lets, likewise the distilleries, and likewise the rectifiers. [Here the gavel fell.] Mr. DIRICSEN. Mr. Chairman. I ask the gentleman to yield me 2 additional minutes. Bdr. STALKER. Mr. Chairman, I yield 2 additional min- utes to the gentleman from Illinois. Mr. DIRKSEN. The bill contains a further provision for eliminating control through the instnunentalities of inter- locking directorates, subscriptions to stock, glXU of fixtures, money, or otherwise. This has been completely eliminated ; so we will no longer have what was known as the " old system " whereby the brewer or the distiller could so effec- tively regulate the retail outlets that they practically owned them outright. I think this is essential : and as I hear these dlMUsfflons of the old-time saloon I somettmes wonder If, after all, they do not refer to the old-time saloon system, rather than to the saloon as such, where thert was a close, coordinated reUtlonshlp betwsen the brewery, the distiller, and the retail outlete which gave rise to all the iniquity and vice of the old system. This, Z believe, has been effectively eliminated In the provisions of this bill. Mr. O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. DIRKSEN. I yield. Mr. O'CONNOR. Will the gentleman tell us what can prevent the situation we have in New York whereby his Peoria distillers are advancing the license fee of $750. or whatever it is, to the people in New York who sell his Peoria liquor? Does the bill specifically prevent the dis- tillers from advancing money for the license fee to the retailers? Mr. DIRKSEN. The bill provides against the advance of money of any kind for such a purpose. [Here the gavel fell.] Mrs. NORTON. Mr. Chairman, I sneld 5 minutes to the gentleman from New York [Mr. O'ConkorJ. Mr. O'CONNOR. Mr. Chairman, I realize the difficulty of drafting a bill to control the sale of liquor. I said a few days ago there was no great hurry about this bill; because after you get the liquor it is going to be very dangerous to drink it, and probably you will not have the numer to pay the exorbitant prices the Whisky Trust will ask for it. But it is fundamental, as was suggested by the gentleman from Ohio, that the more regulations you put on the sale of liquor the greater trout^ you will get into. Svery regula- tion is an avenue of graft. Every regulation points a way for somebody to proceed to extort graft from the pur- veyors of this liquor. If 3rou say by jrour reculations that one cannot drink standing up, that you must drink sit- ting down; if you say sales shall be made to be drunk only on the premises but not to be drunk off the premises; if you fix the hours of business, in all' these things you open avenues of graft. Why, before December 5, the date of reipeal, in New York, before repeal was even effective, the " bosrs " were out " shaking down ", as they say, the prospective customers. . If you provide that these commissioners of the District can say where the rum is to be sokl. that it may be sold in cer- tain zones, you open avenues for graft. As far as I am concerned— and I took this position on the beer bill — I would let anybody seU liquor who wanted to sell It, In any place, provided they paid the license fee. I would let 7 or 8 of them sell it in a row alongside of each other in the same block, for then they might kill each other off. That is the way to abolish the saloon: To provide for universal sale and not make a congregating place out of the licensed place of sale. I believe this bill will be fairly good if amended in cer- tain particulars. I hope the gentleman from Michigan [Mr. WnsEXAN] win offer the "label amendment." If nobody else does, I shall offer an amendment that druggists can sell only on a prescription that is a real prescription, accord- ing to the United States Pharmacopoeia; that they caxmot sell "blended" or "cut" whisky which might go into the mouths of babes 1 year old, or be used by elderly people. I do not know why. Madam Chairman, you charge a brewer a license fee of $2,500, whereas you charge a distiller only $2,000. Why the discrimination? As to the dispensary system, I have always taken the position that this was the last method our Government should ever resort to in the control of the liquor btislness. I have said repeatedly that I never want to see my Oovem- ment, my State, or my city in the rum business. There Is a lot of talk about the saloon. This is one of the bromides that has grown up by mere constant repeti- tion. I was always frank enough to say X was not against the saloon provided it was a good saloon. Some one has yet to define what a saloon is. Why, there arc rotten, disrepu- table dance halls, yet we license them. There are billiard parlon which tr« only dens of gangsterf, yet we license then. Wfl license beauty parlors and masMff pgrlors which conduct an lllerltimate bus) news. Whether or not a saloon Is a decent pUce is solely a question of local enforcement. This Idea that t m*n must drink iUting down instead of etandlnff up. after the Americftn habit of drinking stand- ing up hai become so Imbedded in our people, is ridiculous. It is a sop gnd an attempt in some way to appease the " dry " element which fought for prohibition. Why. there Is a provision in this bill continuing the old law which says you cannot take a drink in public, on the street, in your autonxobile. on the platform of a railroad station, and so forth. In other words, if I am taking a train to New York and have a bottle of real whisky with me and feel ill, although I paid for the bottle and it is my own property, I may not use it; I cannot drink it, but must sneak into the restaurant or a hotel to drink my own Uquor. [Here the gavel fell.] Mr. STALKER. Mr. Chairman. I yield the gentleman 1 additional minute. Mr. O'CONNOR. It is such regulatory provisions which will bring back the old hold-ups we had during prohibition. I believe that if there can be a few amendments added to this bill and if the board or the commissioners do not throw too many regulations aroimd it, it may work. If the purpose of repeal of the eighteenth amendaient is truly carried out for the benefit of the people who might want the 272 CONGRESSIONi .L RECORD— HOUSE January 9 opportunity to drink: who did not want restrictions thrcwn around what they thought their personal rights; who wanted an opportunity to get a drink when they wanted it; \rho voted for that principal: the proper regulation of the traffic will restore temperance, but an improper or excessive re di- lation will put us in a worse position than that in which we existed durtna prohibition. [Here the gavel fcll.l Mrs. NORTON. I jield 15 minutes to the gentleman from Virt^inia I Mr. Smith]. Mr. STALKER. Mr. Chairman, I 3rield the gentleman 8 minutes. Mr. SMITH of Virginia. Mr. Chairman. I do not th nk I am going to need 23 minutes. So much has been said on the question of liquor control that I hesitate to say any- thing further on the subject. However, I believe the Mem- bers of the House would like to have some information on the subject relating to the two outstanding systems of liq lor control as they are being formed at this time in public opinion. One is the type of control proposed by the committee bill. I am opposed to the bill as drafted by the commit ee. I favor the dispensary system. I introduced a bill, wh.ch was before the committee, for the dispensary system. T lat bill is H.R. 6148. and I hope the Members of the House irill take the opportunity to look over that bill before cast ng their vote on this one. So far as the committee bill Is concerned, I think he chairman of the Dt-rtrlct Committee [Mrs. Norton] is un- titled to the thanks of the people of the District of Colum- bia and the Members of this House for the great amount of work and toil that she has put in on the bill. If you are going to have such a system in the Capital of the United States. I believe the gentlewoman from New Jersey [ Norton! has psrhapo presented to you just as good a as can be presented. But I do not think that in the C tal city of the United States liquor ought to be dispe: und?r such a plan. I believe that we should adopt dispensary plan. I believe that we owe it to the peotle under our party platform not to permit the private sale of whisky to be consumed by the drink on the premises wbsre sold and handled for private profit. The bill which I favor and which I am going to seek to net a vote on In the Committee of the Whole before this mat ,er is concluded is fundamentally the Canadian system. It is adapted from the Queb^'c system, so I claim no pride of authorship in the bill at all. I got it in this way: In Vir- ginia, after the repeal of the eighteenth amendment, we had a special session of our legislature. A commission was p; o- vided ta devise some plan for the control of liquor in i he State of Virginia. The Governor of the State of Virgliiia selected the most outstanding and the most promlnrnt pertons. some of whom were for and some against proiii- bitlon, and put them on the commission to draft a bill or the State of Virginia. From the melting pot of these cc n- fllctlng views was brought forth the Quebec system funca- mcntally. This has the approval of the outstanding drys in our State and has the approval of the outstanding w ;ts in our State as being the best and most practical way to control this situation. Mrs. NORTON. Will the gentleman yield? Mr. SMTTH of Virginia. Certainly. Mrs. NORTON. I have an article here from the Hen Id of January 9, 1934. headed as follows: "Dispensaries Plm Denounced by Drya." It would not seem from a reading of this article that t le drys are in favor of the dispensary plan, and I quote tie Reverend Ira Lindrith. of Winona Lake. Ind., and also I>r. E. H. Cook. Denver cleric, who lived many years in Cana< a, and who held up as an horrible example the Canadian liqu or system. He declared that under Province control there drunkenness increased fourfold, hard-liquor consumptim twofold, wine consumption fivefold. Dr. Cook further stat sd that there are 3,355 speck -easies in Quebec, and that Britikh Columbia is the bootleggers' paiadise Mr. SMITH of Virginia. Was that a question or just a comment? Mrs. NORTON. Tliat was an obsei-vation. Mr. SMITH of Virginia. Well, I will make an observation myself. I do not know who is in favor of this system or who is against it. I merely know that I am expressing the views which I have and I certainly would not undertake to change the views of any Member of this House. We have con- flicting views upon many subjects, and I am net here for I the purpose cf influencing anyone's views, but I am here '■ for the pui-pose of saying to you that there are two ways j to control the liquor question. One is sale by the drink, I for private profit, to be consumed on the premises. This ; is inherently and necessarily a barroom. 1 I have heard the discussions about this matter upon the floor of this House and I listened to the discussions before the joint committee of the Senate and House. I participated I in those discussions, and I challenged any proponent of this I bill at that time to point cut the distinction between the j bill v.'hich the committee proposes and the old-time barroom, I and no one could point out any difference except the differ- ; ence between standing up and sitting down. I Under the bill v.'h:ch is proposed by the committee, where liquors may be sold in restaurants and hotels, any person i who is over 21 years of age, be he mun or woman, boy or girl, may go into a hotel or a restaurant and may seat him- self or herself at a table and he or she may drink Just as many varieties of liquor as there are on the shelf and can get just as drunk, or perhaps dnmker, than he or she could if he or she were standing up. This has all of the old, inherent evils of the barroom. The authorities I have read on the subject seem to agree that the chief, inherent evil in the old system of dispensing liquor was the element of private profit. One of the gentle- men who spoke a few minutes ago in favor of the Com- missioners' bill was bold enough to quote the report of the I Rockefeller Foundation as substantiating his position. Let me read to ycu the conclusion of the report of the Rocke- feller Foundation: I On the basis of past experience In the United States and abroad I and the practictil consldemtior.s wc have lu.n received, ve have I come to the conclr.si'jn that the mcst satisfactory solution of the I problem of alcohol requires the elimination of the private-profit j motive in the retail sale cf liquo.'. This cannot conceivably be accomplished under a license system however rigid and well '• enforced. If we sincerely wish to meet only an unstimulated demand for alcohol, we c.in no longer leave to any individual a I private stake in its retail sale. ! Mr. BRITTEN. Will the gentleman yield for a question { there? Mr. SMITH of Virginia. Briefly, please. Mr. BRITTEN. If the gentleman would rather not yield. I will not put my question. Mr. SMITH of Virginia. I would rather not, becau.se I think my time is very limited and I want to get along with my discussion of the bill. The bill which I propose, which is the dispensary system, provides for the sale of hard liquors in sealed packages under a control board operated by the District of Columbia, with no private profit to anybody in hard liquor. It does pro- vide, however, for the sale, under a license system, in hotels and restaurants of wines and beer. In other words, it seeks to bring about that thing which seem.s to be so much desired of attempting to encourage the use of beer and wine as against the use of hard liquors. There has been some discussion of the South Carolina system. If you will read the Rockereller report— and m.y time is so limited I have not the time to read it to you— you will find a very cogent reason why the South Carolina experi- ment was a failure. You will find, in the first place, it was inextricably mixed up with the matter of politics and. in the second place, you will find that in those dispensaries there existed the inherent evil of which I have spoken of private profit. Mr. BLACK. Will the gentlem.an yield? Mr. SMITH of Virginia. Yes. 1934 CONGRESSIONAL RECORD— HOUSE 273 Mr. BLACK. I have before me the temporary price list of the Liquor Board of Pennsylvania and it offsets the gen- tleman's argiunent because this statement shows it to be almost a patriotic duty in Pennsylvania to buy Lquor, be- cause it says that every loyal citizens, by patronizing the system, will assist in its success and that the board is pro- ceedlns with the utmost speed to obtain full stocks, and that it will be profitable to buy from the board. This is propa- ganda coming from the State of Pennsylvania urging its clt:zen3 to drink in the dispensaries. Mr. SMITH of Virginia. Is that a question or a comment? Mr. BLACK. ■ No; it is a help. [Laughter.! Mr. SMITH of Virginia. I may say to you that I know there are Members of this House who do not want the private sale of liquor system, and do not want to vote for such a system here today. This is the only bill now before the Committee, and I want to give the Committee an op- portunity to vote for an alternative plan, namely, the dis- pensary system; and at the proper time, after the reading of the first section of the bill. I propose to move to strike out that section and to substitute in place thereof the dis- pensary bill, which is H.R. 6148. and by this method I hope to test the sentiment of the House on this subject. There are Just two systems, and to save your life you cannot find any reasonable distinction between the bill offered by the Commissioners and the old system of the saloons. The difference, which has been mentioned, is the difference between standing up and sitting down. There is, also, a further difference and it is a most important one. In the old dnys drinking in the saloons was confined to the men. Under this bill men and w^omen, together or sepa- rately, may sit in these restaurants and in these hotels and drink as Ions as they can hold it. Mr. BRITTEN. Will the gentleman yield there for a question? Mr. SMITH of Virginia. Yes; I will. I find I have more time than I thought. Mr. BRITTEN. The gentleman, of course, realizes that men and women may go to a dispensary and buy a quart of liquor. Docs the gentleman contend they will not get drunk on that liquor, because it is bought from a dispensary? Mr. SMITH cf Virginia. No; I do not contend that at all. I merely contend that of the two systems the dispensary system, I believe, is the best, and comes nearer carrying out the promise of the Democratic Party to the people of America when we repealed the eighteenth amendment. I do not say that the dispensary system is the ideal thing. I do not know what is the ideal system. If we knew. I am sure we cculd adept it in a very few moments, becauce I am quite confident that the proponents of th:s bill are as sincere and honest in their convictions that it is the ideal plan as I am in my conviction that tlie dispensary is the ideal plan. You are going to find objections to all bills for the control cf licuor. There always have been and there always will be. When we repealed the eighteenth amendment it was because the people wanted to repeal it, and they wanted in place of it scms substitute for the evils of those conditions. Both parties solemnly promised that if the eighteenth amend- ment was repealed that we would not have a return of the eld open saloon. And when the proclamation was made by the President on December 5 of the repeal of the eighteenth amendment, he made a statement — I do not recall the exact wcrd-s — but he recalled that promise to the people of the country and said: I hope that no State In this Union will adopt any system of ilquor control that would bring about the return of the saloon, either In its old form or In any modern guise. Now, Will someone tell me— and I will yield him time for the piu-pose — where is the inherent difference between this bill and the situation of the old saloon? Here is a propo.sal whereby any hotel or restaurant may sell liquor by the drink, have it consumed on the premises, just as many drinks as the person wants to buy, as many as he can pay for. and the only difference is you have to sit down at a table while you drink. In other words, you do not have to buy any more in the restaurant under this bill than you did in the old saloon, or any less. I hope before this debate Is concluded that some of the proponents of the bill on the other side who are as sincere in their views as I am in mine — I do hope some one will take occasion to try to convince the Houve that there Is a practical distinction between the plan proposed in this bill and that of the old saloon. Mr. MARLAND. Will the genUeman yield? Mr. SMITH of Virginia. I yield. Mr. MARLAND. Does the gentleman contend that ths provisions of this bill do net carry out ths pledge of the Democratic Paity? Mr. SMITH of Virginia. I do. Mr. LANZETTA. WiU the gentleman yield? Mr. SMITH of Virginia. I yield. Mr. LANZETTA. Does not the gentleman fesl that the most vicious drinking in the past has been behind closed doors and not in open places? Mr. SMITH of Virginia. I am not qualified to aniWer that. Mr. LANZETTA. I do not know that I am qualified, but I believe that the most vicious drinkinj has been behind closed doors. Mr. SMITH of Virginia. The gentlaman may be right about that. I will not argue it. Mr. SISSON. Will the gentleman yield? Mr. SMITH of Virginia. I yield to the gentleman. Mr. SISSON. The gentleman is advocating a sy^tcn whereby if an individual wants a drink of liquor he cannot get it without buying a pint or a quart. Mr. SMITH of Virginia. He could not get it without buy- ing a sealed package. A dicpensary may sell a gill in a sealed package. Mr. SISSON. I take it that it is the gentleman's con- tention that no opportunity shall be given for the individual to get a drink of liquor except if he buys a quart or a pint and takes it home. Mr. SMITH of Virginia. He could take It to a club or a hotel — take it to his own room. Mr. DONDERO. Mr. Chairman, will the gentleman yield? Mr. SMITH of Virginia. Yes. Mr. DONDERO. Can the gentleman Inform the Houtc as to what action has been taken, in other States cxce;;t his own. which he has referred to, regarding this question? Mr. SMITH of Virginia. I think they have taken It under consideration. In my State the legislature has not acted — the board has. In Pennsylvania, I believe, they are i trying it. Mr. BRITTEN. They have had it for a month in Penn- sylvania. Mr. PALMISANO. Mr. Chairman, will the gentleman yield? Mr. SMITH of Virginia. Yes. Mr. PALMISANO. Under the gentleman's bill is there any limitation upon what one individual could buy in a day? Mr. SMITH of Virginia. No. Mr. PAUtnSANO. He could buy 150 quarts if he wanted to. if he went back to the same store, in one day. Mr. SMITH of Virginia. The gentleman does not like that feature. I will tell you, then, what we will do. If the House will vote with me, and let us have a dispensary bill, we will send it back to Mr. Palmisano's committee, and I am sure that Mrs. Norton will draw Just as good a bill under the dispensary system as she has drawn on the other side. I am not concerned with the details of this bill. You can write the bill any way you want to. but I think that we ought to write it around the principle that there shall be no sale of spirits for profit to be consumed on the premises where purchased. That is the fundamental difference between the two. Mr. BRITTEN. Mr. Chairman, will the gentleman yield? Mr. SMITH of Virginia. Yes. Lxxvin- -18 i 274 CONGRESSIONi'.L RECORD— HOUSE January 9 he a he he ny he set Mr. BRITTEN. As I understand the gentleman's bill, is aiming to force upon the consumer the drinking oi bottle at a time rather than a glass at a time. Mr. SMITH of Virginia. He can drink a bottle if wants to. but he can drink tvro bottlefuls by drinking in hotel under this other bill. I yield back the balance of time. Mrs. NORTON. Mr. Chairman. I yield 5 minutes to gentleman from Ohio [Mr. TruaxI. Mr. TRUAX. Mr. Chairman and Members of the Cckn- mittee. I think, as the gentleman from Texas [Mr. Blant^nI said, this debate is largely a matter of the difference betw tweedledum and tweedledee. I believe if this Congress were to debate this question for the balance of the session you could not draft and pass a law that would satisfy the honest, leg.timate dry, who does not drink, who does not want otfer people to drink, nor could you satisfy the straddling sta man or politician who drinks wet and votes dry- Let us down to the fundamentals of this issue. I ha];^)en to h^ve been a resident of the first county in Ohio that voted under local option. My little town of Sycamore, of population, was one of the first towns in Ohio to vote Ary under local option. When the three saloons went out of business — and every man who has ever been in a saloon knows that we had good saloons and bad saloons in the sId days — the two drug stores in the town took over the busini sss. One drug store had a roll-top desk about half-way back on the fioor. The druggist had the top of the desk piled : ull of books, but in the desk he had a neat little bar. Tou co ild go in there and pour yourself out a drink for 10 cents, wl ile in the drawer at the side, which was full of half pints, : ou could pick up one and leave a quarter on the desk for it. In the next drawer there were pints, and you could pick one of those out and deposit 50 cents on the desk for it. When the county went dry our citizens who wante< a drink simply went to the neighboring counties. The poin ; is that you cannot in a few years — in 15 ]rears — destroy ;he appetite that has accumulated in the human r^e through 5,000 years. People who want to drink will drink, regard- less of the character or quality of the stuff they drink. Away back before prohibition I remember we had in ^y little town a lecture by a noted temperance lecturer, ing the course of his remarks he used two water glasse; illustrate the point he was attempting to make, namely, evil effects of alcohol on the human system. These gl were both filled with a colorless fiuid such as in the g here on this table. He took up one of the glasses i^d reached into his pocket and drew forth a little tin box. He snapped the lid open and said, " Now, ladies and gentlem en. watch what I do." He pulled a fishworm out of the wx and dropped it into the glass that he said was filled ixith water. He said. " You notice that nothing happens to the worm"; and the worm wiggled around apparently cm- tented and happy. " Now ". he said. " see what happens to this worm when I drop it into the other glass ", which y i^as also flUed with a colorless fluid. He dropped the worm i ato this glass and immediately the worm stiffened out and ^pas dead. A fellow jumped up in the rear of the hall and sj lid, " Mister, what was in that glass that killed that flshworn ? " The lecturer replied. " That was old triple-distilled mo )n- shlne, 110 proof." " WeU ", the fellow said, "save mii a glass of it; I am troubled awful bad with worms." [Laughter.] Mr. Chahman. with all due respect to my distinguis: led colleagues who have spent a great deal of time in delate about stopping bootleggers and the difference betweeii a saloon and a parlor or a restaurant and the difference pe- tween standing up and sitting down — as many of you jold timers recall, many people had to drink lying down, and tney will probably drink that way today. The real question t lat confronts us is this: The American people decided that i ro- hibltion was a failure. They said that prt^bitlon was a failure by sending Wet Congressmen aad Senators to Washington to rei^ace Iry Congressmen and Senators. The successful Democratic o ui- didate for the nomination for President of the United States declared that he was for the repeal of the eighteenth amendment. The platform of the Democratic National Convention adopted at Chicago declared for repeal of the eighteenth amendment. The candidate who was nominated by the Democratic Party said in his memorable acceptance speech, " You want repeal. I want repeal. The people want repeal"; and thanks to the tireless energy, the unswerving devotion to principle of Franklin D. Roosevelt, the greatest friend of the common people to sit in the Presidential chair since Lincoln and Wilson, and his loyal coworkers, the twenty-first amendment, repealing prohibition, is a part of the Constitution of the United States today. During the past few months the question of prohibition repeal was submitted to more than 36 States. Only two of the States voted to retain the prohibition system. In nearly every one of the other States the vote was preponderantly in favor of repeal. Yet we find the Congress of the United States today quib- bling over such minor details as to the manner and form of the places in which liquor shall be sold and how it shall be | drunk. If all the advocates of the various postures in which j it would be legal to driok liquors and wines, including those ' who advocate drinking it standing up, those who say it t should be be taken sitting down, and those who reach the stage where it can be taken in no other than a reclining or lying -down position, cannot get together, perhaps we may ' have to compromise by devising some mechanical means ' whereby the heavy imbiber may take it from a trough as we slop our hogs back in Ohio, the medium drinker can take it either standing up or in a semireclining position, while the fellow who votes dry and drinks wet, without doubt, will have to be twitched on the nose and drenched, like we farmers give medicine to our horses when they are sick with the colic. Like Nero, we fiddle while Rome burns. The American people decided at least 4 years ago that prohibition was a failure insofar as enforcement was concerned. I peisonally know that the American people reached that decision at least 4 years ago, because I was defeated for the nomination for United States Senator from Ohio by a gentleman who sensed the revolt against prohibition and came out on a platform for repeal of the eighteenth amendment. TTie gentleman from Virginia and other gentlemen believe, and sincerely so, that a dispensary system would be a better system than the system proposed in this bill; that it would better promote temperance: that it would put the bootleggers out of business; and that it would promote sobriety and prevent drunkenness and debauchery among our young people. Experience teaches us that this is a fallacious doctrine and theory. On the other hand, observation teaches us that more and uncontrolled drunkenness and debauchery of both our young manhood and our young womanhood can take place within the narrow confines of a hotel room than formerly occurred in a dozen of the old saloons. Experience teaches us also that dnrnkenncss can only be reduced by individual self-control, by being temperate in all things— not only temperate in the use of intoxicating liquors but temperate in the consumption and varieties of food con- sumed. The matress-fronted fat dowager and the pot- bellied street-comer politician are just as intemperate in their habits of eating, and as obnoxious to their fellow men, as the red-nosed drunkard, whose appetite for spirituous liquors is uncontrolled. Before prohibition the country had practically the same dispensing system that we will now hare under this bill. The assertion has also been made on the fioor of this House that in preprohibition days only men were permitted to drink in the barrooms. This is distinctly not the case, as many barrooms or cafes may be recalled that catered to both men and women. We had the barroom where hard liquor, beer, and wines might be purchased by the dnnk, by the pint, the quart, or the gallon. We had the wholesale liquor houses, where only whisky, wines, and brandies might 1934 CONGRESSIONAL RECORD— HOUSE 275 be purchased by the quart, the gallon, or the barrel. In those warehouses good unbonded whisky could be purchased for as low as $2.50 a gallon. Yet dnmkenness always depended upon the capacity of the individual. I recall of one farm hand and hog feeder employed on my farm in the old days — a big, broad, rugged, two-fisted six-footer — who spent about 16 hours a day work- ing in the open air, who on every Saturday night would journey to the nearest wholesale liquor house and buy 1 gal- lon of liquor. He took 4 drinks a day, 1 before breakfast, I before dinner, 1 before supper, and 1 before retiring. The glass that he used for the drinks was an ordinary water glass. He did not have to mix it as a highball, but " took his liquor straight." The man never became dnmk, to my knowledge. He had a great capacity. Please do not consider this a defense of the old system, nor a defense of the excessive use of spiritous liquors. It is merely a statement of facts, to prove conclusively that American citizens who want to drink will have their drink when and how they want it, regardless of governmental laws, edicts, or regulations. Mention has been made of the findings and recommenda- tions of the Rockefeller Foundation. They recommend that all private profits be taken from the distribution of liquor. I wonder if John D. Rockefeller, Jr., who contributad $5,009 to the National Economy League to slander the American war veteran, prostitute his widow, and debauch his orphan child, would be willing to take the private profit out of the distribution of gasoline and oils to stop the bootlegging of gasoline. When you take the private profit out of legal distribution of liquors, wines, and beers, you only divert it into the slimy pockets of the bootleggers, rumrunners, and racketeers. All of these evils have sprung up largely because of the maladjustment of economic and social well-being in this country, the concentration of huge wealth in the hands of a few. the maldistribution of the earnings of the country, the strangulation of the economic circulatory system, the throw- ing cut of jobs of 15.000.000 wageworkers, the annihilation of private business by the huge trusts and mergers, the breaking of the backs of the masses of the people by the shifting of the tax burden from the public utilities, the Wall Street buccaneers and pirates, the banking crooks, the silk- stocking aristocracy to the already bent backs of the small- home owner, wageworker, and farmer. Regardless of what the tax on liquor may or may not be, regardless of what regulations are adopted, regardless of what enforcement measures are employed, you will have the bootlegger with you until you can give him an honest and a better way to earn a living, until you give every able-bodied man a job that will keep himself and his family in decent style, until you have a limit on the amount of wealth any individual can accumulate, until you limit the amount of income any individual may receive in a single year, and, finally, until you shift this crushing tax burden from the backs of the poor to the ill-gotten wealth of the millionaire crowd — human vultures waxing fat on the bleaching bones of the struggling masses who are ruthlessly trampled down by their lustful plundering for more wealth and more millions. The CHAIRMAN. The time of the gentleman from Ohio has expired. Mr. STALKER. Mr. Chairman, I yield 1 minute to the gentleman from Illinois [Mr. Britten]. Mr. BRITTEN. Mr. Chairman, I ask unanimous consent that during the 1 minute allotted me I may proceed out of order in order to read a telegram from Chicago which I have just received, which is not controversial at all, I want to read it, not only for the benefit of the House but particu- larly for the benefit of the 27 Members from Illinois. I make that request, Mr. Chairman. The CHAIRMAN. Is there objection to the request of the gentleman from IlUnois? Mr. BLACK. This is the first time the gentleman has ever asked to be out of order. There was no objection. Mr. BRITTEN. Mr. Chairman, this telegram has just been received: For the first time In more than 25 years, at least, there was no milk delivered in Chicago today to homes. Scores of thousands of small children were accordingly denied their main sustenance. The enfeebled and those requiring milk diet alro were forred to use condensed milk or to go without. In view of the general sit- uation, with which you undoubtedly are familiar, do you not think a congressional investigation at this time is warranted? This is signed by John W. Dienhart, city editor of the Herald-Examiner. My reason for rising at this time, my friends, is to call to the attention of at least the 10 Members of the House from Chicago the situation existing in Chicago, where mothers and children are not getting any milk today. It may be impossible for the Federal Oovemment, through Its Etepartment of Justice, to do anything in the premises, but surely some way must be found by Federal authorities. If not by the local authorities, to see that milk is allowed to be debvered. If necessary, they should guard every milk wagon. I would like to speak with all Members from Illinois on this subject at the earliest possible moment. Mr. Chairman, since receiving this telegram I have com- municated with the Attorney General with a view to having the Federal Department of Justice take such steps as It may deem necessary and as are permitted under the Federal stat- utes for the protection of human life and private property in the most destructive milk strike that this country has ever had. The Attorney General is today communicating with representatives of the Department of Justice in Chicago for complete information concerning the various elements of the strike which has been brought about by the disagreement between the producers and the distributors on the price of milk. It is interesting to note that the United States Su- preme Court only on yesterday handed down a decision which placed the rights of the people above the laws of the land in national emergencies. I refer to a decision on the Minnesota case, which directly affects the National Recovery Act. As for myself, I would not hesitate to request the calling out of the Federal troops at Fort Sheridan if that act were necessary in order to insure the delivery of milk to the homes of Chicago. I also talked with officials in the Agricultural Adjustment Administration and learned that they had communicated with D. N. Geyer, head of the Chicago Pure Milk Associa- tion, as late as last Simday evening, with a view to acting as arbitrators in connection with this unfortunate affair. I was told that the Federal willingness to be of service to the people of Chicago was not accepted. The general impression here appears to be that the matter is squarely up to Governor Homer and Mayor Kelly, and if they cannot bring about the orderly delivery of milk to the homes in Chicago when backed up by the National Guard of the State and the Chicago police department, then there is something radically wrong with the administration of Justice in Illinois. If need be. a well-armed, stout-hearted Chicago motorcycle policeman should accompany every milk wagon Into the city. The National Guard of the State is maintained at the taxpayers' expense for Just such purposes and events as are now confronting Chicago. I hope It will not be necessary for the Federal Government to forcibly step into the situation in the interest of law and order. [Here the gavel fell.l Mrs. NORTON. Mr. Chairman, I yield 5 minutes to the gentleman from New York lUr. Black]. Mr. BLACK. Mr. Chairman. I think the members of the Committee on the District of Columbia fully appreciate the efforts of the District Commissioners during the recess of Congress to formulate a bill for the regulation of the sale of liquor In the District. The members of the committee also feel that the District Commissioners have done a mighty fine job in the bill which they have presented to us. We also feel a debt of gratitude to Mr. Bride and Mr. West, corporation counsel and assistant corporation counsel of the District of Columbia. 276 CONGRESSIONi\ L RECORD— HOUSE January 9 I This bill, we believe. \b a workable proposition. It viD make for sane and decent regulation. There are some things in the bill that may be too highly regulatory, and we can probably cure them on the floor, but from the experi- ence we have had in the States which thus far have sold liquor, this is a decent and serviceable proposition. Anybody who thinks there will not be evil attending the sale of liquor is just as stupid as those who thought you could stop the sale of liquor. No matter what system you take, there is going to be some evil attached to It. Tlie gentleman from Texas [Mr. PatmanI makes much of me Democratic platform, which sought to effectively abolish t tie saloon and to bring the liquor traffic out into the op(in. That did not mean that the public of Washington had to line up on Pennsylvania Avenue and have a military offl( er pour out the liquor for him in Government tin cups, un< er the dispensary system. The Democratic platform did lot mean anything like that at all. Under this bill the old-tii ne saloon is abolished. The old-time saloon provided for sde for consumption on the premises and sale for consumpti3n off the premises. One of the evils of the old-time salo^in, which was often vividly portrayed by the drys, was the old family entrance, with a child, with holes in her stockings, hanging around the family entrance with a can for be>r. All those things are done away with. Here is a decent regulation. You have your hotels. You have your legi;i- mate restaurants; you have your taverns for the sale of beer. Nobody need worry that the old-time saloon is possi >Ie under this bill. In New York we have a law somewhat similar to t);is, and you do not find the old-time saloon in New York. } Ve have been operating some time now under the new Stste act, since the repeal of the eighteenth amendment. The suggestion in the Democratic platform that the liqu or traffic be brought out into the open did not mean that ever y- body who wanted to drink had to drink in the open. It merely meant that the traffic was to be raised from t le underworld: that the traffic was to be taken away from tie racketeers: that the traffic was no longer to be a crimiral traffic, but that the traffic was to be legal and licensed, so that everybody in the community could know who was in the traffic, what their characters were, and the traffic wis to be surrounded by safeguards, so that a man who spent money to get a license and spent money to fit up his place would see to it that he himself rigorously observed the li,w 80 that he would not be punished summarily by having his license taken away and his business destroyed. That is all the Democratic platform meant. It did not mean the se extravagant suggestions which my friend Patman indicate. that evenrbody in Washington who wanted to take a driik would have to drink In Garflnckel's window. It did not mean that at all. It merely meant the legitimate and saie regulation of the traffic that had been outlawed, had be;n restored to a legal standing, that was in the open as a legitimate business, and that is all it meant. There may be some things in this bill that might ae changed by the House. Ijut taken all in all. it is the jud i- ment of the Committee on the District of Colimabia that this bin win work out to the satisfaction to the residents of the District. Mr. Chairman, I yield back the balance of my time. The CHAIRMAN. The gentleman has consumed 5 mii- utes. Mr. STALKER. Mr. Chairman, I yield 2 minutes to tie gentleman from Missouri £Mr. Cocurak]. Mr. COCHRAN of Missouri. Mr. Chairman, I would not support a measure that would bring back the saloon. If I thought for a minute tliat this bill would restore the saloc ti, I would vote against if. Wilh that feeling I wiU not suppc rt a substitute that would perpetuate the speak-easy. That is what the dispensary system win do. There is not a man here who understands conditions n the city of Washington who does not know that hundreis and hundreds at speakeasies have been open here since pr >- hlbition went into effect. I know it. and I am ».*i^iwg fxQ n experience, not hearsay evidence. Everyone who knows any- thing about Washington will say the same thing. This bill was submittted to Congress by the 3 Commis- sioners, 2 appointees of President Roosevelt. The adminis- tration of the measure will prove whether it is a success or not. I happen to know the three Commissioners personally, and I know them so well that I am sure if it is possible to eliminate saloons and speak-easies in the city of Washington they will be eliminated. The dispensary system is all wrong. Right over here in the neighboring county of MMitgomery. in the State of Maryland, one pays $7 a quart for whisky in the dispensary, which can be purchased in Washington drug stores for $4.75: and this is not hearsay either. I speak from actual experience. Do we want to have a fight between Montgomery County and the city of Washington and the State of Virginia over the price and sale of whisky? Nearby Virginia and Mont- gcMnery County, Md.. have the dispensary sjrstem. That Is why they want the dispensary system in Washington. They want their citizens to buy their whisky at home and want to prevent them from busring a drink in a Washington hotel. In support of my contention that you can now buy whisky, legally in Washington from drug stores cheaper than you can from the Montgomery County, Md., dispensary which adjoins the city, I quote the prices of the dispensary from its price list. I only refer to bottled-in-bond whisky, as blended whisky does not interest me, but what is true of bottled In bond is true of blended goods: Old Taylor (16 years), pint $3.50 Old Granddad (16 years), pint 3.50 Old Reaerve (16 years), pint 3.24 In Washington, in drug stores, you get Old Taylor in quarts for $5.25. Old Granddad for $5.25. I have no record of Old Reserve, but Gold Star, better than those quoted, can be bought for $4.75, as can Tom Harvey, and both are 16 years old. Gin is quoted at $4.75 in the Maryland dis- pensary, while the best of domestic gin sells for $2 in Wash- ington drug stores. I have a price list from Pennsylvania dispensaries, show- ing the cheapest bottled in bond at $6.50. All others quoted above that figure. The dispensary prices equal the old bootleggers' prices. Again. I say, do not perpetuate the sj)eak-easy by providing for a dispensary system. The saloon is more preferable than the speak-easy. I told you this city is overrun with speak-easies, not only on the streets, but in office buildings. You read from time to time of the killings in speak-easies. Just a few weeks ago a gangster, one of Washington's worst gunmen, was slain in one before the eyes of a hundred peo- ple and the killer has not been apprehended. You must provide for a place, a legal place, for a man to get a drink who does not want liquor in his home. This bill reported by the committee makes this provision. Pass this bill and have faith in Commissioners Hazen, Allen, and Gotwals to see that It is strictly enforced, which will mean the elimination of the saloon and a far worse evil — the speak -easy. [Here the gavel fell.] Mrs. NORTON. Mr. Chairman. I yield the balance of my time to the gentleman from Maryland [Mr. PalmisanoI. Mr. PALMISANO. Mr. Chairman, there has been some talk here about the open saloon and violation of the Demo- cratic platform. The Commissioners who drew this bill were appointed in the last 2 or 3 montiis by the President of the United States, the man who put the antisaloon plank in the Democratic platform. Certainly no one here will say that these men, having been appointed by the President, wUl arbitrarily as their first act as Commissioners of the District of Columbia violate the very platform promise made by the President. Let us get away from this idea. If this is in violation of the Democratic platform the President will not stand for it; for as my colleague from Virginia has stated, the President made a request of aU Governors not to 27R CONGRESSION^ L RECORD— HOUSE January 9 1934 CONGRESSIONAL RECORD— HOUSE 277 permit the open saloon. Is It reasonable to believe the President will sign a bill which violates his own request? So. there is no question but what the President knows the contents of this bill and is satisfied with it. Neither is there any question of there being an open saloon. The eighteenth amendment was repealed in order that the American people might take a drink. How shall they have it, out in the open or in speak -easies and furnished rooms of rooming houses? What will happen if one is com- pelled to buy a pint or a quart of liquor every time he wants a drink, or if 4 or 5 men not individually having the price of a pint or a quart of liquor chip in their nickels and their dimes to get it and go back in the alley and drink it, or go into some dark back room about which the police know nothing? Suppose you prohibit hotels and restaurants selling liquor and wines; what will happen? How will you control the liquor traffic? There is no limitation as to what you can buy under the so-called " dispensary system." If I have some friends who want a drink of liquor I buy a quart and take them to a hotel or restaurant. The proprietor is not charged with violating the law. I may get beastly drunk in that place and the proprietor cannot control it because he does not sell it. On the other hand, if you permit the proprietor to sell liquor, the minute he or his agents or servants see a person taking a little more than he can carry he will say to whom- ever it may be: "You have enough; you cannot get any more." But what can the proprietor say to the man or woman who goes into his plrffce and says, " I want a meal; give me some steaks "; who pulls out his flask and says, " Give me a bottle of ginger ale"; who sits there with his wife, or with a lady friend, and drinks that whole quart and then has to be taken out? How will you regulate such situations? Mr. Chairman, what we want is regulation. The more regulation we have, the more temperance we will have. Let the police and the Commissioners of the District have control of the sale of liquor. If we are to have a dispensary system, as the gentleman from Ohio says, let us start with the distillery; let us control all the liquor in the country and then dispense it to each individual in the United States £0 much a week, maybe 2 ounces, maybe 3 ounces, or maybe a pint; and make it a violation of law if anyone consumes more than a specified quantity within the week, the month, or whatever period of time the law may prescribe. Then we shall have a real genuine dispensary system. But we must start at the distillery; we cannot start at the retail store. In Maryland we have had experience with the effort to limit sale and consumpion. There are nine Eastern Shore counties represented by the gentleman from Maryland, my colleague [Mr. Goldsbosottgh]. Of course, he had no part in formulating the law of 1914; but, to continue with my statement, the dry section of the Eastern Shore of Mary- land insisted that a citizen be permitted to have a gallon a month. One of my friends from an Eastern Shore county whose name, I think, is Dodson, the son of a preacher, a dry gentleman, wanted to give the people of that district what they wanted, so he voted to give them a gallon a month each. In order to get this liquor they had to make an appli- cation and attach to it an affidavit. Finally this man found that apparently his father prescribed for somebody. Of course, it was not so; it was not his father's signature on the prescription; someone had forged his name. So my friend came to Annapolis the next year and asked for the repeal of the law. This is what you call " dry " sentiment. People want to drink; drinking cannot be stopped, and prohibition has illustrated this. Let us give It to the people in the open. Let the police regulate it. Let us say to the man who handles it, the man who pays the $700 or $1,000 for a license, the hotel keeper, or whoever he may be, that he cannot sell to a person who is intoxicated. I have had experience in this matter. When I was 20 years of age my life was threatened because I would not sell to an intoxi- cated man. Nevertheless, he did not get the drink. Under the dispensary system there cannot be this restxiction on drunkenness. If you say to the hotel or restaurant keepers, " We will take your license away from you If you violate the law ", do you think those responsible for the operation of the Raleigh, the Washington, the Wlllard. the Mayflower, and similar hotels will violate the law? [Here the gavel fell.] Mr. STALKER. Mr. Chairman. I have no further re- quests for time. The CHAIRMAN. The Clerk will read the bill for amend- ment. The Clerk read as follows: Be it enacted, etc., That the act of OongrcM antltted "Aa act to prohibit intoxicating beverages and to regulate the manufacture, production, use, and sale of hlgh-jMroof spirits for other than beverage purposes and to Insure an ample supply of alcohol and promote Its use In scientific research and In the development of fuel, dye, and other lawful Industries", approved October 3S. 1919, and all acts supplemental to and amendatcxy thereof. Insofar as they affect the manufacture, sale, and possession in the Dis- trict of Columbia and the transportation In, into, and from tha District of Columbia of alcoholic beverages upon which the Fed- eral tax has been paid, are hereby repraded. with the exception of section 4 of title 11 of said act of Congress, approved October 28. 1919. Insofar as It affects denatured alcohol and title XXI of said act. Mr. SMITH of Virginia. Mr. Chairman, I move to strike out the section and to substitute in lieu thereof the provi- sions of H.R. 6148, which is the dispensary bill. Mr. BLACK. I make a point of order ffgainst the amend- ment, Mr. Chairman, on the ground that it is not germane. Mr. SMITH of Virginia. I should like to be heard on the point of order. The CHAIRMAN. What is the point of order? Mr. BLACK. The point of order is that the amendment is not germane to the bill itself nor to the section Just read. The CHAIRMAN. The amendment has not been reported as yet. Mr. BLACK. I ask unanimous consent that we dispense with the reading of the sunendment. It Is a long amend- ment, and I believe everybody understands it. The CHAIRMAN. The Clerk will report the amendment. The Clerk read as follows: Amendment by Mr. Smith of Virginia: Page 1. strike out an of section 1 down to and Including line 7 on page a. and Insert In lieu thereof the provisions of HJl. 6148. The CHAIRMAN. The gentleman from New York Asks unanimous consent that the reading of the amendment be dispensed with. Is there objection? There was no objection. The amendment in full is as follows: Be it enacted, etc.. That this act may be cited as " The Alcoholio Beverage Act." ^ , ^ * ._ Sbc 2 The following terms, wherever used or referred to in this act. BhaU have the foUowlng meaning unless a different mean- ing clearly appears from the context: (a) "Alcohol " shall mean the product known as ethyl or grain al«>hol obtained by distillation of any fermented Uquor, rectified either once or oftener, whatever may be the origin thereof, and shall Include synthetic ethyl alcohol, but shaU not Include methyl alcohol and alcohol denatured In accordance with formulas ap- oroved by the Government of the United Stotes; the word " alco- hol " when used In the phrase " more than 3 J percent of alcohol by weight " shaU mean aU alcohol whether obtained by distUlatlon. fermentation, or otherwise; _. ^. _, (b) "Alcoholic beverages" shaU Include the four varieties of liquor defined herein as alcohol, spirits, wine, and beer, and any one or more of such varieties, and every liquid or solid, patented or not, containing alcohol, f-plrlts, wine, or beer and capable of beine' consumed by a human being. Any Uqxild or solid conUln- inxmotethan 1 of the 4 varieties above defined shaU be consid- ered as belonging to that variety which has the higher percentage of alcohol however obtained, according to the order In which they are set forth In this subsection; ^ .^ ^^ , ,. ,. (c) "Beer" shaU mean any beverage obtained by the alcoholic fermentation of an infusion or decoction of barley, malt, and hems or of any similar producto in drinkable water and containing, u^ims otherwise expressly provided, more than 8 J percent of alcohol by weight: this definition shaU include ale, porter, and (d)' " Board " shall mean the I>l8trlct of Coltunbla Alcc^ollc Bev- erage Control Board; ^ ..... .^ (e) " Bottle " ShaU mean any vessel Intended to contain UqiUda and having a capacity of not more than 43 ounces; (f ) " Club " shall mean any nonprofit corporation or association which Is the owner, lessee, or occupant of an eetaWUhment oper- 278 CONGRESSIONi'.L RECORD— HOUSE li advui- o] ler pi ac- Colum tU; ■ull ler- >U: alcob }llc ised the 9De contld Ts ttM let: AlooboUc muflCVlM' to malDti >in« Biont ily, MMTt* Ated Mriely for objects of • national, social, patriotic. poUtlcal athleUc natiire, or the like, but not for pecuniary gain, the tagea of which belong to all the members: It also shall mean ••tabllshment so operated: (g) " Dentist " ahall mean any person duly authorized to tlce dentistry pursuant to the laws of the District of (h) "Dining room" shall mean a public room In which meals are regularly served; (1) " Druggiat " shall mean any person duly authorized to ate a pharmacy pursuant to the laws of the Dtotrlct of Colum (j) "Establishment" shall mean any place where alec" beverages of one or more varieties are manufactured, sold, or pursuant to the provisions of this act; ( k ) " Oovemment store " shall mean a store estabUabed by board under this act for the sale of alcoholic beverages or any or more varieties tbeteof ; (1) "Hotel" sbaU mean any duly licensed estaUlahment, Tided with special space and aeeommodation. where. In tlon of peymcnt. food and lodging are habttuatty tumiMhet persons: and which has 10 or more bedrooms; It shall also Ibe pcraon wbo operates such hotel: (m) " Interdicted person " shaU mean a person to whom •Ble of alcotiollc liquor is problblted by order ptirsuant to tbls (n) " XntoKleated ": Any person who has drunk enoufb beverages to so affect his manner, disposition, speech, movement, fsneral appearance, or bcbavior, as to be sppareni observation, shall be deemed to be intoxicated: (o) " Uanager " shall mean the appointee of tbe board in of a Oovemment store: (p) "Member of a club" ■hall mean a person who his membership in the said club by the payment of quarterly, or annual dties In tbe manner eetablished bjr tbe and regulations thereof: (4) "Package" s( ^n mean any container , bottle, ▼ other reeeptacle used for holding alooholle beverages'. (r) "Person" shall Include an Indlirldtwl, pMtnersblp, tlon. or corporation: (s) " Pbysldan " shall mean any person duly authorized practice medicine pursuant to the laws of the District of ~ (t) " Public place " sh#ll mean any place, btillding, or aaee to which the public has. or ts permitted to have aay highway, street, lane, park, or place of public resort amusement: fu> ''Residence" shall mean any building or part of a Ing or tent where a person resides, but does not Include any of a building which part Is not actually and exclusively usei a private residence, nor any part of a hotel or dub other private guest room thereof: (V) " Restaurant " means any establishment, provided with dal space and accommodation, where, in consideration of ment. food (without lodging) Is habitually furnished to (w) "Sale" and "sell" shall Include exchange, baiter trafllc. and any delivery made otherwise than gratuitously, any means whataoever. of alcoholic beverages, to solicit or oeive an order for alcoholic beverages: to keep, offer, or the same for sale: to peddle: (X) "Spirits" shall mean any beverage which contains obtained by distillation mixed with drinkable water and aubstances In solution, and Includes, among other things rum. whisky, and gin: but shall not include any such liquors natured in accordance with formulas approved by the States: (y) "Veterinary" shall mean any person duly authorized practice veterinary science pursuant to the laws of the at Oolumbla: aiul (s) " Wine " shall mean any beverage obtained by the tatlon of the natural sugar contents of fruits or other tural products containing siigar. including honey and milk. with or without additional sugar, and containing more than percent of alcohol by weight. Sac. 3. (a) There Is hereby created as an agency of the of Columbia the District of Columbia Board of Alcoholic Control. (b) The board shall consist of three members appointed by Onmmlsslonera of the District of Columbia. One of the of the board shall be appointed for a term of 1 year, one term of 3 years, and one for a term of 5 years: subcnequent polntments shall be for a term of 5 years each, except appo ments to fill vacancies which shall be for the unexpired te The Commissioners shall designate one of the members of board chairman thereof. The board, under rales adopted Itself, may elect one of Its members chairman, pro tempore, another, or some other person, as secretary. Two members of board shall constitute a quorum. (c) Each member of the board shall receive a salary of per annum. (d> Members of the board may be suspended or removed by Commlwatonera at their pleasure. (e) Cach member of the board shall devote his full time the performance of his official duties. (t) No member, officer, agent, or employee of the board directly or Indirectly, individually, or as a member of a . ahlp. or of an association, or as a member or stockholder eorporatkxi. have any interest whatsoever in the manufactun or In dealing la alcoholic beverages, or in any enterprise or ttustry In which alcoholic beverages are required, or receive or n- Ithe TO- m- to to Columbia; eon' ey- knd or btMd- lart tiuka a iipe- i«y- perser8 fcr p. ap- nt- te^ms. the bv md the 95 000 the to sllall. part4er- a of In- imy January 9 or Un ted any other person whatsoever, or have any Inteiest In or mortgage or deed or trust on any land or building where alcoholic beverages are manufactured for sale, kept for sale, offered for sale or sold, or any personal property used therein, or In any contract, other than his contract of employment, made with the board. The provisions of this subsection shall not prevent any member, officer, agent, or employee of the board from purchasing and keeping In his possession, for the personal use of himself, mem- bers of his family, or guests, alcoholic beverages which may be purchased or kept by any person by virtue of this act. Sxc. 4. The functions, duties, and powers of the board shall be as follows: (a) To buy. Import, and sell alcoholic beverages, other than beer, and to have alcoholic beverages in Its possession for sale: (b) To control the possession, sale, tran^wrtatlon. and delivery of alcoholic beverages by the board: (c) To determine the localities within which C3ovemment stores ahall be established and operated and the location of such stores; (d) To make pro%'lslon for the maintenance of wmrebouses for alcoholic beverages and to control the delivery of alcoholic bever- ages to and from such warehouses, and the keeping of the same therein: (e) To lease, occupy, and Improve any land or building required for the purpose of this act: (f) With the consent of the Congress to purchase or otherwise acquire title to any land or building required for the purpose* of this act and to sell the same; (g) To purchase, lease, or acquire the use by any manner what* soever of any plant or equipment which may be considered neces- sary or useful In carrying into effect the purpoees of this act, Including rsctifyinK. blending, and processing plants, but not manufacturing planu; (b) To determine the nature, form, snd capacity of all pack* ages to be used for contalnlnx ak'ohnUc beverages to be kspt or sold under this art and to prescriiM the form and contents of all labels and seals to b« placed thereon; (I) To appoint every officer, agent, and employee required for Its operations, dismis* them, ftx their salaries or remuneration, assign them their oArial posittona and titles, define their respec- tive duties and power*, require them or any of them to give bonds payable to the united States in such penalty as shall be fixed by the board, and engage ttie services of experts and of persorui sn- gaged in the practice of a profession: all salaries or remuneration In excess of tl.OOO per annum Hhall first be approved by the Com- missioners of the District of Columbia; members, officers, agents, and employees of the board are authorized and empowered to arrest persons for any disorderly conduct In or about any Oovem- ment stores or property of the board or for violations of the I>rovlslons of this act committed In their absence; (J) To hold and conduct hearings, to issue subpetias requir- ing the attendance of witnesses and the production of records, memoranda, papers, and other documents before the board of any officer or agent thereof, and to administer oaths and to take testimony therevmder: in its discretion to authorize any member, officer, or agent of the board to hold and conduct hearings, issue subpenas, and administer oaths and take testimony thereunder; and (k) Generally to do all such things as may be deemed necessary or advisable by the board for the purpose of carrj-ing into effect the provisions of this act. Sec. 6. (a) The board may from time to time make such regu- lations not inconsistent with this act as the board shall deem necessary for carrying out the provisions of this act. and from time to time alter, repeal, or amend such regulations or any of them. Such regulations shall be published at least once in some newspaper published In the District of Columbia and in any other manner which the board may deem advisable, and upon being so published shall have the force and effect of law. (b) Prima facie evidence of any such regulation may be given in all courts and proceedings by the production of what purports to be an officially printed copy of such regulation, alteration, repeal, or amendment. Sxc. 8. (a) No member of the board may be sued civilly for doing or omitting to do any act in the performance of his duties as prescribed by this act. except by the United States. (b) The board may In the name of the United States of America at the relation of the District of Columbia alcoholic beverage control board be sued in the Supreme Court of the District (rf Columbia to enforce any contract made by the board or to recover damages for any breach thereof and may defend such proceedings and may institute proceedings in any court. Wo such proceedings shall be taken against, or in the names of, the members of the board. Sec. 7. (a) The board shall from time to time make reports to the Commissioners of the District of Columbia covering such matters in connection with the administration and enforcement of this act as they may require, and shall annually make to the said Commissioners a report for the 12 months ending on the 30th day of June in the year in which the report is naade. which shall contain: (1) A statement of the nat\ire and amount of the business transacted by each Oovemment store under this act during the year; (2) A statement of the assets and UabUiUes of the board. In- cluding a profit-and-lo6S account, and such other accounts a^"^ 278 CONGRESSIONiSX RECORD— HOUSE January 9 1934 CONGRESSIONAL RECORD— HOUSE 279 Ated wtMty for objects of • national, social, patriotic. poUtlcal or athletic nature, or the like, but not for pecuniary gain, the adv ux- tages of which belong to all the members; It also shall mean the establishment so operated; (g) " Dentist ■■ shall mean any person duly authorized to pi ac- tlce dentistry pursuant to the laws of the District of €k>lum >la; (h) "Dining room" shall mean a public room In which "ull meals are regularly served; (1) " Druggist " shall mean any person duly authorised to o] ler- ate a pharmacy pursuant to the laws of the District of Colum >la: (J) " EstabUstunent " shall mean any place where alcoholic beverages of one or more varieties are manufactured, sold, or i sed piirsuant to the provisions of this act; (k) "Government store " shall mean a stoce estabUsbed by the board under this act for the sale of alcoholic beverages or any one or more Tarletles thereof; (1) "Hotel" shall mean any duly licensed cataMlshment. ] to- Tlded with speelal space and aceommodatlon. where. In consld (ra- tion of payment, food and lodging are habitually tumUhe< to persons; and which has 10 or more bedrooms; It shall also mmo the person who operates such hotel: (m) "Interdicted person" shaU mean a person to whom the sale of aloohoUe liquor is problMted by order ptirsuant to this tct: (n) " XntoKleatcd ": Any person who has drunk enough alooti ollc bsferagss to so affect his manner, disposition, speech, muscilar movement, general appearance, or bebavlor, as to be appareni to obesrraUon. shall bs dsemsd to be intoxicated; (o) " Manager " shall mean the appointee of the board in ebi ^rge of a Oovemment store; (p) " Msnber of a club " ihall mean a parson who malni .Ins his membership in the said club by the payment of moni ily, quarterly, or annual dties In the manner established bjr the r lies and regulatloiM thereof; (q) "Paekace" si vll mean any container, bottle, ▼easel, or ether reeeptacle used for holding aloohollc beverages; (r) "Person" shall incltide an Individual, partnership, assorts' Men. or eerporation: (s) " Physldsn " shall mean any person duly authorized! to practice medicine pursuant to the laws of the District of Colum >ls; (t) " PuMle plsos " shsU msan any place, building, or eon< ey- •aee to which the public has, or Is permitted to have aceess, ind •ay highway, straet, lane, park, or place of public resort or amusement: fu> "Residence" shall mean any building or part of a btlld- iBg or tent where a person resides, but does not Include any ; Mirt at a building which part Is not actually and exclusively usei a^ a private residence, nor any part of a hotel or club other thi d a private guest room thereof; (V) " Restaurant " means any eetabllshment, provided with i ipe- dal space and accommodation, where, in consideration of [«y- ment. food (without lodging) la habitually furnished to persiins, (V) "Sale" and "sell" shall include exchange, baiter, und trafllc. and any delivery made otherwise than gratuitously, by any means whatsoever, of alcoholic beverages, to solicit or re- ceive an order for alcoholic beverages: to keep, offer, or ex] loee the same for sale: to peddle; (X) "Spirits" shall mean any beverage which contains alcohol obtained by distillation mixed with drinkable water and o' her substances in solution, and Includes, among other things, brajkdy, rum. whisky, and gin; but shall not include any such liquors de- natured in accordance with formulas approved by the Un ted States; (y) "Veterinary" shall mean any person duly authorizeers of the board shall be appointed tar a term of 1 year, one fcr f> term of 3 years, and one for a term of 5 years; subeequent ap- pointments shall be for a term of 5 years each, except appo nt- ments to fill vacancies which shall be for the unexpired tei ms. The Commissioners shall designate one of the members of the board chairman thereof. The board, under rales adopted bv itself. may elect one of Its members chaimuui, pro tempore, md another, or some other person, as secretary. Two members of the board shall constitute a quonun. (c) Each member of the board shall receive a salary of 15 000 per annum. (d> Members of the board may he suspended or removed by the Commlwatanars at their pleasure. (e) Rach member of the board shall devote his full time to the performance of his official duties. (f) No member, officer, agent, or employee of the board stall, directly or Indirectly, individually, or as a member of a partx er- ahlp, or of an association, or as a member or stockholder o I a eorporatlon. have any interest whatsoever in the manufactim of or In dealing la alcoholic beverages, or in any enterprise or in- dustry In which alcoholic beverages are reqtilred. or receive my commlaston or profit whatsoever <»- have any interest whataotver ha the purchasa or sale of aloohollc beverages by the board cor by any other person whatsoever, or have any lnteif«t in or mortgage or deed or trust on any land or building where alcoholic beverages are manufactured for sale, kept for sale, offered for sale or sold, or any personal property used therein, or in any contract, other than his contract of emplo3rment, made with the board. The provisions of this subsection shall not prevent any member, officer, agent, or employee of the board from purchasing and keeping in his possession, for the personal use of himself, mem- bers of his family, or guests, alcoholic beverages which may be p\ut:hased or kept by any person by virtue of this act. Ssc. 4. The fiuictions. duties, and powers of the board shall be as follows: (a) To buy. Import, and sell alcoholic beverages, other than beer, and to have alcohol tc beverages in Its possession for sale; (b) To control the possession, sale, tran^wrtatlon. and delivery of alcoholic beverages by the board; (c) To determine the localities within which Oovemment stores shall be established and operated and the location of such stores; (d) To make provision for the maintenance of warehouses for alcoholic beverages and to control the delivery of alcoholic bever- ages to and from such warehoiises. and the keeping of the same therein: (e) To lease, occupy, and Improve any land or building required for the purpose of this act; (f ) With the consent of the Congress to purchase or otherwise acquire title to any land or building required for the purposes of this act and to sell the same; (g) To pttrcbase, lease, or acquire the use by any manner what* soever of any plant or equlpntent which may be considered neces' •anr or useful in carrying into effect the purpoees of this set, Including rsctifyinR, blending, and processing plants, but not manufacturing plants; (h) To determine the nature, form, and capacity of all pack* agsa to be ussd for contatninic alcoholic beverages to be kept or •old under this act and to pr«»crilM the form and contents of all labels and seals to be placed thereon: (I) To appoint every ofBcer, agent, and employee required for Its operations, dismiss them, (Ix their salaries or remuneration, assign them their offirlsl poslttona and titles, define their respec- tive duties and powerM. require them or any of them to give bonds payable to the united States m such penalty as shall be fixed by the board, and engage the bervlces of experts and of persons sn- gagsd In the practice of a profession: all salaries or remimeratlon In excess of 11,000 per annum shall first be approved by the Com- missioners of the District of Columbia: members, officers, agents, and employees of the board are authorized and empowered to arrest persons for any disorderly conduct in or about any Oovem- ment stores or property of the board or for violations of the provisions of this act committed In their absence; (j) To hold and conduct hearings, to Issue subpenas requlr* Ing the attendance of witnesses and the production of records, I memoranda, papers, and other documents before the board of any officer or agent thereof, and to administer oaths and to take I testimony thereunder; in Its discretion to authorize any member, j officer, or agent of the board to hold and conduct hearings, issue j subpensis, and administer oaths and take testimony thereunder; and j (k) Generally to do all such things as may be deemed necessary , or advisable by the board for the purpose of carrying into effect the provisions of this act. Sxc. 6. (a) The board may from time to time make such regu- I lations not inconsistent with this act as the board shall deem necessary for carrying out the provisions of this act. and from I time to time alter, repeal, or amend such regulations or any of them. Such regulations shall be published at least once in some I newspaper published in the District of Columbia and in any other manner which the board may deem advisable, and upon being so published shall have the force and effect of law. I (b) Prima facie evidence of any such regulation may be given I in all courts and proceedings by the production of what purports I to be an officially printed copy of such regulation, alteration, j repeal, or amendment. I Sec, 8. (a) No member of the board may be sued civilly for [ doing or omitting to do any act in the performance of his duties as prescribed by this act. except by the United States. (b) The board may in the name of the United States of America at the relation of the District of Columbia alcoholic beverage control board be sued in the Supreme Court of the District of Columbia to enforce any contract made by the board or to recover damages for any breach thereof and may defend such proceedings and may institute proceedings in any court. Wo such proceedings shall be taken against, or in the names of, the members of the board. Sec. 7. (a) The board shall from time to time make reports to the Conunissioners of the District of Columbia covering such matters in connection with the administration and enforcement of this act as they may require, and shall annually make to the said Commissioners a repwrt for the 12 months ending on the 80th day of June in the year in which the report is nuule, which shall contain: (1) A statement of the nature and amoxint of the business transacted by each Oovemment store under this act during the year; (2) A statement of the assets and UablllUes of the board. In- cluding a profit-and-lo6S account, and such other accounts and matters as may be necessary to show the restilt of the oi>erations of the board for the year; and (3) A statement Showing the taxes collected under this act during the year. (b) The books and records of the board shall at all times be subject to examination and audit by the Auditor of Public Ac- counts and such agency as the Commissioners of the District of Columbia may designate. Sec. 8. The board shall keep such complete and accurate records as shall be necessary to show: (1) All moneys received by the board; (2) All disbursements of money made by the board; (3) The amount of money on deposit and on hand; (4 1 The security given the board by depositories of the txtard; (5) The kinds and amounts of alcoholic beverages on hand and the location thereof; (6) All indebtedness and all contracts of the board: (7) All receipts from and costs and expenses Incurred for and on behalf of each Oovemment store; and (8) All real estate owned or leased and all real estate sold by the board Ssc. 9. (a) The board may establish, maintain, and operate In such locations as shall be considered advisable by the board, Oovenunent stores for the sale of alcoholic beverages, other than beer, in accordance with the provisions of this act and may dis- continue any such store or stores when In its discretion it Is advisable to do so. (b) The board shall, from time to time, fix the prices at which the various classes, varieties, and brands of alcoholic bereragss shall be sold in such stores. (c) The sale of alcoholic beverages at each Oovemment store shall be conducted by s mannKer, and by such other ofBcers, tL%fnU. and etni^nyres as may bi» appointed hereunder, who shall, under the dlrrrtlon of the board, t>e rcspfiniUble for the carrying out of the provisinn* of th*H art and the regulations of the board initofnr mm th«>y r»\»tm to the conduct of *ueh stois and the sale of aU:oholic oeveraKSS thereat, (d) No alcobolle beverages shall be sold In a Oovemment store except In a cloned package, sealsd and containing such label as tl»e board shall prescribe. (e) No alcoholic beverages thall bs consumed In a Oovemment store by any per*»on. (f) No more than 1 gallon of alcohol or spirits shall be sold to any one person at any one time in any Oovemment store; this provision shall not limit the amount that may be sold by the board In Government stores or otherwise for Industrial purposes end to druggists licensed under this act. (g) The board may from time to time adopt regulations relat- ing to the sale, delivery, and shipment of alcoholic beverages, and alter, amend, or repeal the same In order to prevent the unlawful cale and delivery thereof In and from Government stores. Sec. 10. (a) Every order of the board for the purchase of alco- holic beverages shall be authenticated by the chairman cf the board or by a member of the board authorized by the board to authenticate such orders, and no order shall be binding unless so authenticated. (b) A duplicate of every such order shall be kept on file In the office of the board. (c) All cancelations of orders made by the board shall be au- thenticated In the same manner and a duplicate thereof kept as herein provided. Sec. 11. No sale or delivery of alcoholic beverages shall be made at any Government store, nor shall any such store be kept open for the sale of alcoholic beverages — (a) On Sunday; (b) On any public holiday fixed pursuant to the provisions of the laws of the District of Columbia; (c) During such other periods and on such other days as the board may direct. Sec. 12. (a) All moneys received by the board from the sale of alcoholic beverages and from license taxes shall be deposited by the board in such bank or banks or trust company or trust com- panies as shall be designated by the board. (b) All disbursements of moneys so deposited by the board shall be by check, draft, or other order signed by the secretary of the board, and countersigned by the chairman or another member of the board designated by the board, or by some officer or agent of the board authorized and designated by the board for such purpose. Sec 13. The board shall make all payments necessary for the administration of this act. Including the payment of the salaries and remuneration of the members, officers, agents, and employees of the board, and all costs and expenses incurred in establishing and maintaining Government stores and in the administration of this act. Sec. 14. (a) The accounts of the board shall be made up to and including the 31st day of March, the 30th day of June, the 30th day of September, and the 31st day of December in each year and at such other times as may be determined by the Com- missioners of the District of Columbia, and in every case the board shall prepare a balance sheet and statement of profit and loss and submit the same to the said Commissioners^ Sec. 15. The net profits derived by the board under the pro- visions of this act shall, after deducting therefrom such sums as may be allowed the board by the Commissioners of the District of Columbia for the creation of a reserve fund to meet any losses that may be Incurred by the board In connection with the ad- ministration of this act and to provide for the depreciation on the buildings, plant, and equipment owned, held, or operated by the board, be paid by the board into the Treasury of the United States to the credit of the District of Coliunbia, quarterly. within 30 days after t^e cloee of each quarter. Sac. le. The board may grant the foUowtng Uoenaes imdsr the provisions of this act: (a) DIstUlers' licenses, which shall authorlas the licensees to manufacture alcoholic beverages other than wine and beer, and to sell and deliver or ship the same in accordance with regula- Uons of the board, in barrela. botUaa. or other cloaad containers to the board and to persons outside of the Dlstrlot of Columbia for resale outside of the District of Oolumbla. except that no deliveries or shipments shall be made into any State the laws at which prohibit the consignee from receiving or selling the same. T;^/^/M>r\ TJ/MTCT? Taxtttabv Q ! 280 CONGRESSIONAL RECORD— HOUSE havlzg • this in 'appllcAlon irrlt- bMurd lien- UcexMd: OJt • Men Uz ^nt «uli}eet lnj\in< tlon rsUU lloinse, mi knu- wh4ther or to n< r mer iber, muiu- p ovl- f, [cesB ye«r (6) (6) t:oteI. reitau- DoUc« at ICMt onee to • newspaper published In or general clroalatlon In the DUtrlct of Columbia. rb) Every person desiring a license under the prorlslons sf act shall, after publishing notice of his Intention as provide 1 subsection (a) of this section, file with the board an appllr-^ therefor on forms provided by the board and a sUtement In Ing and under oath setting forth such Information as the shall require. Sac. 18. (a) The board shall refiise to grant any license Uoned In this act If It shall be of the opinion — ( 1 ) That the applicant Is not a suitable person to be so <3) That the place to be occupied by tba applicant U suitable place; (3) That a stiflclent ntimbcr of Itoenses have already Issued: or (4) Thst the license should not be Issued. (b) The board shall not Issue any license until the license required by section 30 of this act Is paid to the board. lace by for may lloxirs peiBons If it such able or in ■el tax tftrrel Diitrlct an like be 9eer. In this act shall have been previously levied and paid th^eon In full; but if on beer bottled In the District of Columbia there shall have been paid by the manufactxirer the excise tax herein levied on beer manufactiued in the District of Columbia, such bottler shall pay all additional excise taxes which may be due on such beer in bottled form. (c) When any person shsll sell or offer for sale in the District of Columbia any beer purchased or obtained from any pers<»i not licensed either as a brewery, bottler, or wholesaler under the pro- visions of this act, and on which the excise tax herein levied has not been paid, such person shall pay the tax levied in the preceding subsection. 8ec. 26. (a) Every person who is licensed in the District of Columbia to manufacture, to bottle, or to sell at wholesale any alcoholic (leverages shall keep a complete and accurate record of all alcoholic beverages manufactured, bottled, and /or sold by him. Such records shall show the quantities of all such alcoholic bever- ages manufactured and/ or bottled by him, the dates of all sales and deliveries or shipments, the names and addresses of all persons to whom sales and deliveries or shipments are made, the quantities and kinds of alcoholic beverages sold and delivered or shipped and the prices charged therefor. (b) E\ery person licen-sed to sell at retail any alcoholic bever- ages shall keep a complete and accurate record of all purchases thereof, the dates of such purchase, the kinds and quantities of alcoholic beverages purchased, the prices charged such licensee therefor, and the names and addresses of the persons from whom purchased. Every such licensee shall also preserve all Invoices showing his purchases. He shall also keep an accurate account of dally sales, showing quantities of alcoholic beverages sold and the total price charged by him therafor; such account need not give the names or addresses of the purchasers thereof. (c) All such records, Invoices, and accounts shall at all times be open to inspection by the board and any person or persons that may be designated as its agent. (d) The bocurd and the agents duly authorized by it shall at all times be allowed free access during business hours to every place where alcoholic beverages are mantifactured, bottled, stored, offered for sale, or sold, for the purpose of examining and inspecting such place and all records, invoices, and accounts therein. Sec. 26. The provisions of this act shall not be construed to pre- vent nor to require any person to be licensed under the provisions of this act to engage in — — (a) The manufacture, sale, and delivery or shipment by persons authorized under existing laws to engage in such business of any medicine containing sufficient medication to prevent the same being used as a beverage. (b) The manufacture, sale, and delivery or shipment by persons authorized under existing laws to engage in such business of any medicinal preparations manufactured In accordance with formulas prescribed by the United States Pharm.'icopoela and national for- mulary patent and proprietary preparations, and other bona fide medicinal and technical preparations, which contain no more alco- hol than is necessary to extract the medicinal properties of the drugs contained in such preparations, and no more alcohol than is necessary to hold the medicinal agents in solution and to pre- serve the same, and which are manufactured and sold to be used exclusively as medicine and not as beverages. (c) The manufacture, sale, and delivery or shipment of toilet, medicinal, and antiseptic preparations and solutions not intended for Internal human use nor to be sold as laeverages. (d) The manufacture and sale of food products known as " flavoring extracts "' which shall be so manufactured and sold fof cooking and culinary purposes only and not to be sold for beverage purposes. (e) The Board may by regulations, which it may from time to time alter, amend, or repeal, p>ermlt the manufacture, sale, de- livery, and shipment of " Sterne " canned heats and other similar substances without requiring a license therefor. Sic. 27. Except as otherwise provided In section 28 of this act, persons holding druggists' llcen.ses issued under the provisions of this act shall sell alcoholic beverages only for medicinal purposes, and then only up)on a WTltten prescription of a physician, setting forth the name and address of the person for whom prescribed, the kind and quantity of alcoholic beverages prescribed. Each druggist shall preserve, separate from other prescriptions, for a period of 2 years from the date filled, all prescriptions for alcoholic beverages filled by him. Such prescriptions shall at ail times be open to the Inspection of the board and of any duly authorized agent thereof. Skc. 28. (a) A physician may administer alcoholic beverages to a bone fide patient in cases of actual need when in the Judgment of the phj'siclan the use of alcoholic beverages Is necessary. (b) A dentist who deems it necessary that a bona flde patient being then under treatment by him Is in actual need of and should be supplied with alcoholic beverages as a stimulant or restorative, may administer to the patient alcoholic beverages. (c) A veterinary who deenis it necessary may. in the course of his practice, administer or cause to be administered alcoholic beverages to a dumb animal. (d) A person in charge of an institution regularly conducted as a hospital or sanatorium for the care of persons in ill health, or as a home devoted exclusively to the care of aged people, may administer, or cause to be administered, alcoholic beverages to any bona flde patient or Inmate of the institution who is In need of the same, either by way of external application or otherwise for emergency medicinal purposes, and may charge for the alcoholic beverages so administered. 1934 CONGRESSIONAL RECORD—HOUSE 281 Sbc. 29. (a) Wben. after hearing upon du« notice. It shall be made to appear to the aatlsfactlon of the Supreme Court of the District of Columbia or any Judge thereof In vacation, that any penicn. resident or sojourning within the District of Columbia, has, on or after the day on which this act becomes effective, been convicted of driving or running an automobile, car, truck, motor- cycle, enjine. or train while intoxicated or has shown himself to be an improper pemon to be allowed to purchase alcoholic bev- erages, the court or the judge thereof in vacRtlcn may make an order of interdiction prohibiting the sale of alcoholic beverages to ouch p-rson tintll further ordered. Ttxe court or Judge entering any such order shall catise a copy of the same to be forthwith filed with the board. (b) Upon any such order being filed with the board, the board shall forthwith notify, in euch manner as it may provide by Its rcgu'atlona, the interdicted person, the managers of the Govern- ment stores and all persons licensed under the provisions of this act to sell alcoholic beverages at retail, of such order. It shall thereafter as long as such order shall remain in effect be unlawful for anyon3 to sell alcoholic beverages to such interdicted person except In accordance with the provisions of sections 26, 27, and 28 of this act. (c) The board, court, or Judge entering any order of interdic- tion may thereafter at any time alter, amend, or cancel the same as in its judgment It shall deem proper. A copy of each such alteration, amendment, and cancelation shall be filed with the board and notice thereof given by the board as hereinafter pro- vided as to orders of interdiction. (d) Any hearing or investigation under this section by any coui"t or judge may be held in private if the court or judge shall so direct. Sec. 30. All alcoholic beverages and materials used in the manu- facture of alcoholic beverages and containers in which alcohoUc beverages are manufactured, Kept, stored, possessed, sold, or In any manner used in violation of the provisions of this act, shall be deemed contraband and shall be forfeited to the United States. Sec. 31. If there be complaint on oath that alcoholic beverages are being manufactured, sold, kept, stored, or in any manner held, used, or concealed In a particular house or other place in violation of law. the proper officer charged with the duty of issuing search warrants, to whom such complaint is made. If satis- fied that there Is reasonable cause for such belief, shall issue a warrant to search such house or other place for alcohoUc beverages. Such warrants, except as herein otherwise provided, shall be iscued, directed, and executed In accordance with existing general laws. Sec. 32. All proceedings for the confiscation of articles declared contraband and forfeited under this act shall be proceeded against ns provided by existing law in the case of confiscated and contra- band articles. Sec. 33. (a) Except as otherwise provided In section 26 of this act, if any person shall manufacture In the District of Columbia alcoholic beverages without being licensed under the provisions of this act to manufacture such alcoholic beverages, or if any per- son other than one who holds a brewery license or a bottler's license, under the provisions of this act shall bottle beer for sale, he shall be guilty of a misdemeanor. (b) Every person found at any distillery, winery, ch- brewery where alcoholic beverages are being manufactured in violation of the provisions of this act shall be deemed prima facie guilty of manufacturing the same or aiding and abetting in such manu- facture and upon conviction thereof chall be punished as If per- sonally manufacturing the same. Sec. 34. If any person who is not licensed under the provisions of this act to sell alcoholic beverages In the District of Columbia Efcall sell any alcoholic beverages other than permitted by the provisions of this act, he shall be guilty of a misdemeanor. Sec. 25. It any person who holds a license issued under the provisions of this act — (E) t^liall sell any alcoholic beverages of a kind other than that which euch license or this act authorizes him to sell; or (b) Khali sell beer to which wine, spirits, or alcohol, or more than one of any such alcoholic beverages, has been added; or (c) shall cell wine to which spirits or alcohol, or both, have been added, otherwise than as required in the manufactiu^ thereof under regulations of the board; or (d) shall sell alcoholic beverEiges of a kind which such license or this act authorizes him to sell, but to any person other than to those to whom such license or this act authorizes him to sell; or (e) shall sell alcoholic beverages which such license or this act authorizes him to sell, but in any place or in any manner other than such license of this act authorizes him to sell; or (f) shall sell any alcoholic beverages when forbidden by the provisions of this act; or (g) shall keep or allow to be kept other than in his residence and for his personal use, any alcoholic beverage, other than that which he Is authorized to sell by such license, or by this act, he shall be guilty of a misdemeanor. Sec. 38. If any person shall, except pursuant to the provisions of sections 26, 27, and 28 of this act. sell any alcoholic beverages — (a) to any person less than 18 years of age; or (b) to any interdicted person; or (c) to any person who Is Intoxicated; or (d) to any patient under the supervision or control of any District or State hospital, whether such patient be on furlough or otherwise, he shall be guilty of a misdemeanor. Sac. 87. If any pcnon lloeaatd under the proriaaatm at this act to sell wine at retail ahall eell any wine not purchased from the board, he shall be guilty of a miademeanor. See. 38. Any person licensed under the prorlstons of this act who shall fall or refuse to pay any excise tax provided for tn section 24 of thU act. or shall fail or refuse to deliver, keep, and preserve such records, invoices, end accounts as required by sec- tion 25 of this act. or shall fail or reftise to allow such records, invoices, and accounts or his piaoe of btuiness to be examined and inspected as herein provided, shall be guilty of a mledemeanor. Sec. 39. I ( any person shall for any ptirpose whatsoever mix or permit or catose to be mixed with any alcoholic beveragM kept for sale, sold, or supplied by him as a beverage any drug, or any form of methol alcohol, or any crude, unrectlfled or Imptire form of ethol, alcohol, or any other deleterious subctanoe or liquid, he shall be guilty of a mlsdemesnor. Sec. 40. If any person shall advertise In or send any advertising matter into the District, except in accordance with rules and regulations of the board, he shall be guilty of a misdemeanor. Sec. 41. If any person shall buy alcoholic beverages from any person other than a Government store or some person authorised under the provisions of this act to sell the same, he shall be guilty of a misdemeanor. Sec. 42. If any person, other than a common carrier, shall have, possess, keep, carry, ship, or transport alcoholic beverages, which are acquired by such person or any person for whom he is acting in violation of the provision of this act, he shall be guilty of a misdemeanor. Sec. 43. If any person shall while Intoxicated be at or in any public place, he ehall be guilty of a misdemeanor. Sec. 44. (a) If any person shall take a drink' of alcohoUc bev- erages or shall offer a drink of alcoholic beverages to another, whether accepted or not, at or In any public place, he shall be guilty of a misdemeanor, (b) This section shall not prevent any person from drinking alcoholic beverages or offering a drink (tf alcoholic beverages to another in the dining room or other designated room, as defined in section 16 of this act, of a hotel, restaurant, or club, provided such hotel, restaurant, or club, or the person who operates the same. Is licensed to sell for constmsption in such dining room, or room, such alcoholic beverages and the alcohdllc beverages drunk or offered were purchased therein. Sec. 45. (a) If any manufacturer, bottler, or wholesaler of alco- holic beverages, whether licensed In the District or not, or any oflQcer or director of any such manufacturer, bottler, or whole- saler shall have any financial Interest, direct or Indirect, In the business for which any retail license Is Issued, under the provi- sions of this act. or in the premises where the business of any person to whom any such retail license has been issued is con- ducted, or either directly or indirectly shall rent. lend, or give to any person v/ho holds any retail license Issued under the provi- sions of this act, or to the owner of the premises on which the business of any such person so licensed is conducted any money, equipment, furniture, fixtures, or property with which the busi- ness of such retailer Is or may be conducted, he shall be guilty of a misdemeanor. (b) If any person licensed hereunder to sell at retail any alco- holic beverages shall consent to any violation of this section, he shfUl be guilty of a misdemeanor. Sec. 46. If any member, officer, agent, or employee of the board shall be directly or indirectly interested or engaged in any other business or undertaking dealing in alcoholic beverages, whether as owner, part owner, partner, member of syndicate, shareholder, agent, or employee and whether for his own benefit or in a fidu- ciary capacity for some other person or If any member, officer, agent, or employee of the board of any employee of the District shall solicit or receive, directly or indirectly, any commission. remuneration, or gift whatsoever from any person or corporation having sold, selling, or offering alcoholic beverages for sale to the Board in pursuance of this act. or if any person selling or offering for sale to, or purchasing alcoholic beverages from the board shall either, directly or Indirectly, offer to pay or pay any commission, profit, or remuneration, or make any gift to any member, officer, agent, or em^yee of the board, or to anyone on behalf of any such membe]K>fflcer, agent, or employee, he shall be guilty of a misdemeanor.^ Sec. 47. If any person shall unlawfully manufacture, transport, or sell any alcoholic beverages, as herein defined, and at the time of such unlawful manufacturing, transporting, or selling, or aid- ing or assisting In any manner in such act. shall carry on or about his person, or have on or In any vehicle which he may be using to aid him in any such purpose, or have in his possession, actual or constructive, at or within 100 yards of any place where any such alcoholic beverages Is being unlawfully manufactured, trans- ported, or sold, any firearm, dirk, bowle knife, razor, slingshot, metal knucks. or any weapons of like kind, he shall be guilty of a felony, and on conviction shall be confined in the penitentiary not less than 1 year nor more than 3 years, or. in the discretion of the court, confined in the jail for not less than 6 months nor more than 12 months. Sec. 48. (a) No alcoholic beverages other than wines or beer shall be imported. shipi>ed, transported, or brought Into the Dis- trict unless the same be consigned to the board; the board may, however, permit such alcoholic beverages ordered by it from with- out the District for persons for industrial pvuposes or for druggists to be shipped or tran^orted direct to such persons. i 282 CONGRESSIO> briught the the at lor br Qught under »] lother attempt sane jever- nay be oonstrtied to beverages hiB been ftunlly, to In no beverai ea from la^ully shall prcfriBion the >rovl- made i>ther- con- dls- vlola- convlced of def e adant (b) No wine ahaU be Imported, shipped. tnnspcHted. or Into the Dtotrtct unleaa the same be oomlgned to the board board may. however, permit wine ordered by It frem without DUtrlct for persons licensed under this act to sell the reul to be thipped or transported direct to such perso^ purposes of resale. (c) No beer shall be imported, shipped, transported, or Into the District except to the board or to persons licensed the provisions of thl« act to sell the same. 8bc. 40. It shall b« unlawful for any person to attempt any of the things prohibited by this act or to aid or abet in doing, or attempting to do, any of the things prohlbllfed thU act. On an Indictment, Information, or warrant for the vlolat any provision of this act the Jury of the court trying th without a )ury may find the defendant guilty of an of Iseing an accessory, and the punishment shall be the if the defendant were solely guilty of such violation. Sec. 50. No action to recover the price of any alcoholic ages sold in contravention of the provisions of this act maintained. Sic. 51. The provlHions of this act ^all not be prevent — (a) Any person from keeping and poosesslng alcoholic in his residence for the personal use of himself, his famlljr servants, or his guests if such alcoholic beverages shall hav« lawfully acquired by him. nor to prevent such person, his or servants from giving or serving such alcoholic guests In the said residence when such gift or service is wise a shift or device to evade the provisions of this act; (b) Any club Iloenaed under the provisions of this act keeping for members of such club alcoholic beverages aoqtilred by sxich members, provided such alcoholic beverage! not be sold, dispensed, or given away In violation of any of this act. Bwc. 52. (a) Any person convicted of a misdemeanor und^ provisions of thto act. or convicted of violating any other skm of this act. or convicted at violating any regulation by the board under Uie provisions of this act, shall, unless wlM provided, be punished by a fine not exceeding $1,000 oi flnement In ]all not exceeding 13 months, or b^h. In th^ cretlon of the court. (b) In addition to the penalties Imposed by this act for thms thereof, any court before whom any person Is violating any provision of this act. may require such to execute bond, with approved security. In the penalty more than $1,000, conditioned that the said defendant violate any of the provisions of this act for the term of 1 If any such bond be required and be not given, the shall l>e committed to Jail until It Is given, or until he charged by the court, provided he shall not be confined for a longer period than 6 months. If any such bond by a court be not given dxirlng the term of the coiirt by conviction is had. It may be given before the judge vacation or before the clerk of the said court. (c) The provisions of this act shall not be construed to the board from canceling the license at any person vkHatlng any provisions of this act. Sec. 53. No person shall be excused from testifying prosecution as to any offense committed by another under act by reason of his testloKiny tending to Incriminate but the testimony given by such person when called to the by the prosecution sliall in no case be used against hin shall he be prosecuted as to the offense ae to which he Sec. 54. The provisions of this act shall not apply to the facture, bottling, selling, offering for sale, distributing, c shipping, transporting, possession, drinking, using, advertlslni dispensing In the District of Oolumbla of beer, lager bee ' porter, wine, similar fturmented malt or vinous liquor, and Juice containing not more than 3.2 percent of alcohol by Sac. 56. For the purpose of paying the salaries and rei tlon of the members, officers, agents, and employees of the and all costs and expenses Incxirred by the board to. ^ and UMOntalnlng Ooveroment stores, and In the admlnlstrat^n the provisions of this act. there is hereby authorized to proprlated from funds In the Treasury not otherwise the sum of $50,000, or so much thereof as may be ne^nniy be paid out on checks Issued on vouchers signed by the tary of the boavd and countersigned by tlie chairman or member of the board designated by the board, ix by some or agent of the board authorised and designated by the for such purpose. Sec. 5«. If any part or parts, section, subsection. _ clause, or phrase of thU act Is for any reason declared stlttttional. such decUion shall not affect the validity remaining parts of thD act which shall remain In force such act luMl bsen passed with the unoonsUtutlonal parts, aecllcm. subaectloix sentence, clause, or phrase thereof nated. All acts <» parts of acts In conflict with the provisions are hereby repealed. cf wll then of pi event convict ed of for the this hi^nself. stand nor te^lfles. c lanu- arf^lng, . and ale. fruit wielght. rernu nera- loard. establishing of ap- appropflated to iiecre- other rfBcer x>ard sen ence. u icon- o part Mr. BLACK. Mr. Chairman, I make the point of that the iunendment ts not germane to the bill or t< section. The CHAIRMAN. Does the gentleman from Virglnii , fire to be heard? AL RECORD— HOUSE January 9 to do ler by on of case or as not not jwar. defebdant i$ dls- thferefor re< ulred vhlch In the as If or illmi- lereof order the de- Mr. SMITH of Virginia. After the gentleman from New York concludes, I want to be heard on the point of order. Mr. BLACK. The bill sought to be passed here and which is desired to be amended by the gentleman from Virginia sets up a regulation in connection with the sale of liquor i/i the District of Columbia. The amendment proposed by the gentleman from Virginia [Mr. Smith] contains a plan by which the Government, through the District of Columbia and a board of the District of Columbia, will actually engage itself, and for profit, in the liquor business. It provides , that the board may lease suitable buildings. It provides that the board must keep books of account covering the sale and purchase of liquor. It provides that liquor in the first instance may only be sold by the board and that the board may be the only wholesaler in the District of Columbia. It provides for Government stores in the District of Columbia. This is a far different proposition than the one set forth m the bill reported by the committee, which contains no ele- ment at all of governmental ownership, governmental sale, or Government stores. The bill proposed by the committee is purely a bill to regulate a strictly private business. Mr. BRITTEN. Will the gentleman yield? Mr. BLACK. I yield to the gentleman from Illinois. Mr. BRITTEN. Instead of being an amendment to the bill that is now before the Committee, this is, as a matter of fact, a completely new law, entirely different in its provisions. Mr. BLACK. An entirely new theory. I also believe it would be outside of the jurisdiction of the District of Columbia Committee to originally hear and function on such a proposal. This is so far-reaching that it is beyond the power of the District of Columbia Committee to even consider originally. It is an entirely new element in our governmental system in this country. All we seek to do is the ordinary thing by a bill to regulate a strictly private business; that is, set up taxes for a strictly private business, provide licenses, and provide penal provisions. But the amendment suggests the absolute entry of the Government of the United States into a private business — ^something the Government has not done heretofore. ITie suggested amendment sets up a Government board or agency with power to buy and sell liquor and with power to lease, which is entirely different from the simple proposition reported by the District of Columbia Committee. Mr. SMITH of Virginia. Mr. Chairman, the amendment which I offer, as has been said by the gentleman from New York, quite frankly undertakes to substitute HH. 6148, which is the dispensary bUl. for HH. 6181, which is the com- mittee bill. It is my purpose, if the Chair holds my amendment ger- mane, and it should be adopted by the Committee, to move to strike out all subsequent paragraphs of the pending bill. The piuTxjse of this bill is to provide a system for liquor control In the District of Columbia. There are two systems of liquor control. One is the system that is advocated by the District of Columbia Committee, and the other is the dispensary system advocated by myself and numerous other Members. The only difference is the method of control. There is no difference in the fundamental purpose of the legislation, because that fundamental purpose is present in both bills, namely, to provide an adequate system of control. The cmly difference is the difference of opinion between the genUemen on the two sides of the question as to which method is preferable to accomplish the objects sought. If you will take the two bills, Mr. Chairman, and lay them side by side, you wUl find that until you get down to the feature providing for the dispensary system, these two bills are ahnost identical in their language and that the definitions are the same. You may take paragraph after paragraph of the committee bill and compare them with paragraph after paragraph of my bill, and you will find that they are almost similar word for word. The only difference between the two bills is in the method of accomplishing the same object. Both bills have for their ultimate purpose the accomplishment of the same object. I respectfully submit that the amendment is germane, and should the Chair disagree with me and rule that the matter 1934 CONGRESSIONAL RECORD— HOUSE 283 is not germane. I will then move to strike out the enacting clau.ie of this bill and ask for a vote on the question for the purpose of testing the sentiment of the House as to whether they want the dispensary system or the system advocated by the District of Columbia Committee. Mr. BANKHEAD. Mr. Chairman, if the Chair is not pre- pared to rule. I would like to be heard very briefly on the point of order. The CHAIRMAN. The Chair will hear the gentleman from Alabama. Mr. BANKHEAD. Mr. Chairman, without entering upon the question of the merits or demerits of the proposed amendment — and I may say very frankly that if this matter is submitted to the House I shall support the amendment of the gentleman from Virginia — I am deeply and profoundly interested in undertaking to preserve, so far as possible, the continuity of the decisions of the House of Representatives. As one who has endeavored to give matters of this nature some earnest consideration over a course of years, and as one who recognizes, I believe, the supreme importance of undertaking to preserve and make continuous and consistent the decisions and precedents of the House, I may say to the Chair very frankly, in my opmion, despite my personal views on th s question, that the point of order is well taken. I am not going to undertake to cite a long line of decisions on this proposition. I ftel tliat if the parliamentarian has made an inve.stigation of this particular problem, as no doubt he has. he can furniih the Chair with decisions identical v;ith the one now presented by the pending point cf order. I desire to call the attention of the Chair to a decision made by the present Speaker of the House on April 13, 1933, in v.hich this same question v/as involved. Tlio parliamentary philcacphy of this point, Mr. Chairman, is that while the committee bill and the proposed substitute offored by the gentleman from Virginia [Mr. Smith] seek to cffcc'uate the same general purpose, to 'A'it, the control of the sale of intoxicating liquors in the District of Cclmnbia, yet if the Cha'r will give consideration to the respective proposals, the Chair v/ill find that the methods of controlling the proposition as offered in the amendment of the gentle- man from Virginia are entirely different, and it is upon that particular phase of the parliamentary question that Speaker Rainey made this decision. At page 1679 of the Record of the date I have suggested the Speaker said: The question presented has been passed upon two or three times and presents nothing new. The bill under consideration provides a method of farm relief, essentially by the issuance of bonds, to be marketed In the ordinary way. The Prazler bill, which is the subject of the motion to recommit, provides also for farm relief, also for bond Issues, and In addition to that provides a method of meeting the bond issues by currency printed and issued, clearly Inllation. which may amount to as much as three and one half billion dollars. The two methods are as wide apart as the poles. I shall not read all of the decision. The Chair may have it before him. The Speaker concludes with this statement: The Chair feels he cannot Ignore the precedents he has cited, and he might add that he could call attention to a number of others. The Chair wants It distinctly understood that he Is not passing upon the propriety of Inflating the currency. That Is another question. If the currency Is to be Inflated by printing and distributing money in any way, it should be the subject of a separate bill, considered Dy a conunlttee. reported to the House, and considered on the floor in- the ordinary way. As has been pointed out by the gentleman from New York, there are a great number of different methods of procedure proposed in these two bills, and I feel, for the reasons I stated in the beginning of my remarks, to preserve the in- tegrity and the continuity of the precedents upon questions of this sort, which I regard as of very grave importance to the House, the point of order is well taken, for the reason that the substitute, although seeking to effectuate a similar object, in principle, sets up an entirely different method of achieving that object. The CHAIRMAN (Mr. Johnson of Oklahoma) . The Chair is prepared to rule. The bill under consideration provides for the sale of al- coholic beverages in the District of Columbia under a licens- ing system. The amendment offered by the gentleman from Virginia by way of a substitute for the entire bill provides for the sale of alcoholic beverages under a system commonly known as the dispensary ssrstem. It is admitted that the provisions of the two measures are for the accomplishment of the same object; that is. the sale of alcoholic beverages in the District of Columbia. It will be apparent, however, to all Members that the methods used are widely different from each other. The Chair has before him ft number of decisions holding that to a bill seeking to accomplish a pur- pose by one method — an amendment proposing to accom- plish the same purpose by another method is not germane. The Chair will allude to the most recent of the decisions wherein this principle was enunciated. Mr. Speaker Raimit. on April 13, 1933, had occasion to pass upon a question very similar to the one now presented to the Chair. Mr. Speaker Rainey held that to a bill seeking to afiford farm relief by a method of refinancing farm indebtedness through the is- suance of bonds, an amendment proposing to effect such relief through the issuance of currency was not germane. The Chair will not recite the numerous other instances wherein the same principle was enunciated. The Chair thinks that the decisions have been uniform with respect to this principle of the rule of germaneness, and the Chair, therefore, sustains the point of order. Mr. SMITH of Virginia. Mr. Chairman, I move to strike out the enacting clause of the bill, and on that motion I ask recognition. The Clerk read as follows: Amendment offered by Mr. Smtth of Virginia: Page 1, UxiM 1 end 2. strike out the enacting clause. Mr. SMITH of Virginia. Mr. Chairman, ladles and gen- tlemen of the Committee, I regret very much that the Com- mittee on the District cf Columbia has seen fit to raise the point of order on the amendment which I have offered that would have given the House the opportunity to vote upon the alternative method of liquor control which I have offered, namely, the dispensary bill. I have no quarrel with the decision of the Chair, which is eminently correct, if the point of germaneness was raised. However, if we cannot test the will of the House by that method. I propose to test it by this method: I have moved to strike out the enacting clause of the bill, the effect of which would be to kill this particular bill. I would then ask the District Committee to consider the present dispensary bill, because by that method the member- ship of the House would have shown their preference for a dispensary bill; so my motion is to get the sentiment of the House, whether you want the bill reported by the District Committee or whether you want the dispensary bill. I hope that those who, like me. believe that the best method is through a dispensary system will vote to strike out the enacting clause, and then they will have an oiH)or- timity to vote for the dispensary bill. Mr. WEIDEMAN. Will the gentleman yield? Mr. SMITH of Virginia. I yield. Mr. WEIDEMAN. Has the gentleman in his bill provided for the proper labeling of liquor; for instance, whether It is a blend? Mr. SMITH of Virginia. I think so; but I am net con- cerned in the details of the bill. You may strengthen it in any way you please; I am simply interested in the princlpls of the dispensary system. Mr. BLACK. Mr. Chairman, for the same reasons that were advanced on the point of order the committee is op- posed to the motion to strike out the enacting clause. Ths committee wants to see some consistency in the procedure of the House. The gentleman from Virginia offered his bill before the committee. It was considered and voted down, and the p««sent bill was reported on the floor of the House. There is a proper procedure provided for the gentlrman'a bill, if he believes it Is the right bill. We should c:nsid2T this bill in the ordinary way and, if the bill is voted down, then the gentleman from Virginia can by petition pet the Committee to report his bill. Orderly procedure reqiiJ**-* that the Committee should vote down the motion to rtrike 284 CONGRESSIONAL RECORD— HOUSE January 9 out the enacting clause. This bill is entitled to consldfera- tion by the House, to be read in the ordinary way, section by section, and the motion to strike out the enacting clfuse should be voted down. The CILAIRMAN. The question is on the motion of the gentleman from Virginia that the Cotmnittee rise and re- port the bill back to the House with the recommendation that the enacting clause be stricken out. The qut^tion was taken; and on a division (demandel by Mr. SMiT:i of Vh-ginia) there were 62 ayes and 77 no*s. Mr. SMITH of Virginia. Mr. Chairman, I demand telers. Tellers were ordered, and the Chair i^pointed as teJers Mr. SioTii of Virginia and Mrs. NoRTOir. The Committee again divided, and the tellers reported that there were 91 ayes and 118 noes. So the motion to strike out the enacting clause was rejected. The CUrk read as follows: Sxc 3. In the Interpretation of this act, unless the contest indicates a different meaning: (a) The word " alcohol " means ethyl alcohol, hydrated oziile of ethyl, or tplrit of wine, from whatever source or by whatever processes produced. (b) The word "spirits" means any beverage which con;alns alcoho' obtained by distillation mixed with drinkable water and other substances in solution, including brandy, rum, wtisky, and gin. (c) The word " wine " means any alcoholic beverage obtained by the fermentation of the natural sugar contents of fruits or (ither agricultura. products containing sugar, Including all artiflcld or Imitation wines and also Including fortified wines, such as port and sherry. ( d ) The word " beer " means any fermented beverages of any name or dewrlption manufactizred from malt, wholly or in pa^, or from any substitute therefor. (e) The words "alcoholic beverage" or "beverage" includ* the four varieties of liquor above defined (alcohol, spirits, wine, and beer) and every liquid or soUd. patented or not. containing alcohol, spirits, wlnu. or beer and capable of being consiuned by a htman being. Any liquid or solid containing more than one of the four varieties above defined Is considered as belonging to that variety which has the higher percentage of alcohol, according to the ( rder in which they are above defined, except as provided In subsertlon (c) hereof. The provisions of this section and of this act .hall not apply ts any liquid or solid containing less than one ha f of 1 percent of alcohol by volume, nor shall anything containc 1 in this act be construed as affecting the manufacture of apple rider or the sale thereof. (f ) The word " board " shall mean the Alcoholic Beverage Coi :trol Board creatiKi by this act. (g) The word " club " means a corporation for the prom< ^lon of some common object (not including corporations organlze< for any commercial or business purjjose. the object of which is m;ney profit), own.ng. hiring, or leasing a building or space in a building of such extent and character as In the Judgment of the b^ard may be sultiible and adequate for the reasonable and comforijible xtse and accommodations of Its members and their guests, I :ind including such space outside of the buUdlng and adjoining it as may be approved by the board, and provided with such sul able and adequate kitchen and dining-room apace and equlpru-nt. implements, and facilities, and employing such a svilBclent number of employee?, for cooking, preparing, and serving meals fo!' its members and their guests, as shall satisfy the board that the aale of t>everages Intended is not more than an Incident to and is not the prime source of revenue from such space: and the affairs and management of such corporation are conducted by a boarl of directors, ezrcutlve committee, or similar body chosen by the members at least once each calendar year and no officer, ai^ent, or employee of the club is paid directly or indirectly, or rec sir'es in the form of salary or other compensation, any profit from the disposition or sale of beverages to the club or to the membeis of the club or guests Introduced by members beyond the amoux t of such salary at^ may be fixed and voted by the members, or b ' its directors or other governing body. (h) The word "Commissioners" shall mean the Commlseic ners oi the District, of Colvunbla. (1) The word " District ' shall mean the District of Columba. (j) The word - hotel " means a suitable buUdlng or other st rup- ture, approved by the board. Including such suitable space jut- slde of the building and adjoining it as may be approved by the board, kept, used. mainUined. advertised, or held out to the public to be a place where meals are served and sleeping acli>yed therein such cumber aDd kinds ot employw* for pfepulng. o wk* Ing, and serving meals for its gruests as shall satisfy the board that such dining room Is Intended for use primarily as a place for preparing, cooking, and serving meals and that the chief source ot revenue to be derived from the operation of such dining room shall be from the preparation, cooking, and serving of meals and not from the sale of beverages. No such 8p>ace shall be considered suitable If any business is conducted therein other than the preparation, cooking, and serving of meals, except such a business as Is incidental to a bona fide dining room. (k) The word " manufacture " shall Include rectification. (1) The word "meals" means the usual assortment of foods conunonly ordered at varloiis hours of the day and the serving of such food and victuals as sandwiches and salads shall not be regarded as a " meal." (m) The word "person" Includes an Individual, partnership, corporation, and association. (n) The word "restaurant" means a suitable space in a suit- able building, approved by the board, including such suitable space outside of the building and adjoining it as may be ap- proved by the board, kept, used, maintained, advertised, or held out to the public to be a place where meals are served, such space being provided with such adequate kitchen and dining-room equipment and capacity, and having employed therein such num- ber and kinds of employees for preparing, cooking, and serving meals for its guests as shall satisfy the board that such space is intended for use primarily as a place for preparing, cooking, and serving meals, and that the chief source of revenue to be derived from the operation of such place shall be from the preparation, cooking, and serving of meals and not from the sale of beverages. No such space shall be considered suitable if any biislness is conducted therein other than the preparation, cooking, and serving of meals, except such a biosiness as is Inci- dental to a bona fide restaurant. (o) The word "sell" or "sale" shall Include offering for sale, keeping for sale, trafficking In, bartering, delivering for value, ex- changing for goods, or in any way other than purely gratuitously, and every delivery of any alcoholic beverage made otherwise than by pixrely gratuitous tit'.e shall constitute a sale. (p) The word "table" shall not include a counter, bar. or similar contrivance. (q) The word "tavern" means a suitable space In a suitable building approved by the board, including such suitable space outside of the building and adjoining it, as may be approved by the board, kept, used, maintained, advertLsed, or held out to the public to be a place where sandwiches or light lunches are pre- pared and served for consumption on the premises In such quan- tities as to satisfy the board that the sale of beer intended is no more than an Incident to and is not the prime source of revenue of such "tavern." With the following committee amendments: Page 2, line 21, after the word " whisky ". Insert the word " cordials." Page 3, line 2, after the word " sherry ". insert " light wines shall mean wines containing 14 percent or less of alcohol by volume, other than champagne or any wine artificially carbon- ated." Page 5. line 11, strike out the word " fifty " and insert the word " thirty." The committee amendments were severally reported and severally agreed to. Mr. BURNHAM. Mr. Chairman, I offer the following amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. Bttrnham: Page 2, line 22, after the word " means ", strike out the remainder of the paragraph to and including the word "sherry" on page 3, line 2. and Insert in lieu thereof the following: "wine, as defined in title XXVI, sections 441 and 444, of the Code of the Laws of the United States of America as now In force or hereafter amended, and champ>agn'3 and sparkling wines and artificially carbonated wines means aU the foregoing as defined by regulations of the Treasiiry Depart- ment as now or hereafter in effect." Mr. BURNHAM. Mr. Chairman, this simple amendment is for the purpose of clarifying the clause subsection (c). It conforms to the statutes of the United States and also the code prepared and adopted by the N.R.A., the code of fair competition. It simply clarifies. I do not think It requires any further argument on my part. Mrs. NORTON. Mr. Chairman, the committee accepts the amendment. The CHAIRMAN. The question Is on agreeing to the amendment. The amendment was agreed to. The Clerk read as follows: Sec. 7. The Commissioners are hereby authorized to prescribe such rules and regulations not inconsistent with this act as they may deem necessary to carry out »he pxirposes thereof and to con- trol and regxilate the manufacture, sale, keeping for sale, offer for Mie, loUcliatlon of orders for sale, importation, exportation, and 1934 CONGRESSIONAL RECORD— HOUSE 285 transportation of alcoholic beverages In the District ot Columbia for the protection of the public health, comfort, safety, and morals. The Commissioners shall have specific authority to make rules and regulations for the Issuance, transfer, and revocatlcn of licenses; to facilitate and insure the collection of taxes; to govern the operation of the business of licensees, with full power and authority to prescribe the terms and conditions under which alco- holic beverages may be sold by each class of licensees; to forbid the issuance of licensees for manufacture, sale, or storage of alco- holic beverages in such localities in, and such sections and por- tions of, the District of Columbia as they may deem proper in the public interest; to limit the number of licenses of each class to be Issued in the District of Columbia and to limit the number of licenses of each class in any locality in, or sections or portions of, the District of Columbia as they may deem proper in the public interest; to forbid the Issuance of licenses for businesses con- ducted on such premises as they, in the public Interest, may deem Inappropriate; to forbid the Issuance of any class or classes of licenses for businesses conducted near or around schools, colleges, universities, churches, or public institutions, to prescribe the hours during which beverages may be sold and to forbid the sale on Sundays or any holiday or holidays. The powers and authorities expressly enumerated are to be construed as in addition to, and not by way of limitation of, the general powers herein granted. Different regulations may be prescribed for the differei>t classes of licenses, for the different classes of beverages, and for -different localities in or sections or portions of the District of Columbia. Any regulations promulgated hereunder shall become effective 5 days after being published in any daily newspaper of general cir- culation in the District of Columbia. Such regulations may be altered or amended from time to time as the Commissioners may deem desirable. The Commissioners shall also have authority in any time of public emergency, without previous notice or adver- tisement, to prohibit the sale of any or all beverages during the period of such emergency. With the following committee amendments: Page 11, line 3, after the word "interest", strike out "to limit the number of licenses of each class to be issued in the District of Columbia and to limit the number of licenses of each class in any locality in or sections or portions of the District of Columbia as they may deem proper in the public Interest. Page 11. line 11. after the word " businesses ", Insert " established subsequent to April 5, 1933." Mr. KVALE. Mr. Chairman, will the gentlewoman from New Jersey please explain what is sought to be achieved by this language? Mrs. NORTON. It was intended to safeguard those who had already spent a considerable amount of money in fitting up establishments prior to that. The Clerk read as follows: With the further committee amendment: Page 11, line 15, after the word " Sundays ", strike out " or any holiday or holidays." The committee amendments were severally considered and severally agreed to. The Clerk read as follows: Sec. 8. (a) No provision of this act shall by reason only that such product contains any alcoholic beverage, prevent — (1) The manufacture or sale of any perfume, lotion, tincture, varnish, dressing, fluid extract or essence, or vinegar; or (2) The manufacture or sale of any officinal, medicinal, or phar- maceutical preparation, or of any patented or prepared medicine intended solely for medicinal purposes, provided that such product does not contain alcohol in any greater quantity than the amount required as a solvent or preservative, or provided that it be so com- pounded as to render It unsuitable for use as a beverage. (b) If the board shall find, after notice to the manufacturer of, or person acquiring for resale, any of the products enumerated above, and after opportunity to be heard, that any of said products are being used as an alcoholic beverage, the board may notify such manufacturer or person to that effect, and from and after the date of the service of such last-mentioned notice this act shall apply to such product; and such manufacturer or c>erson shall commit an offense under this act if he sells such product after the service ol such notice without a license Issued under this act so to do. This paragraph shall not apply to a preparation prepared by a pharmacist on prescription of a physician and In accordance with Its tenor, or which is prepared by a physician for the use only of a patient actually under his care. (c) The notice provided for In this section shall be served upon the manufacturer or person acquiring such product for resale, personally, if he can be found within the District of Columbia, and If he cannot be so found It ehall be sufficient service of said notice to deliver the same to some person of proper age upon the premises of the maniifactxirer or person acqtilrlng such product for resale. Mrs. NORTON. Mr. Chairman, I offer the following amendment, which I send to the desk and ask to have read. The Clerk read as follows: Amendment offered by Mrs. NoaroK: Page 13, strike out all of section 8 and insert In lieu thereof the following: " Sec. 8. No provision of this act shall apply to alcohol intended for use in the manufact\ire and sale of any of the following when they are unfit for intoxicating beverage purposes, namely: "(a) Denatured alcohol produced and used pursuant to sets of Congress and regulations promulgated thereunder. "(b) Patent, proprietary, medicinal, pharmsoeutlcsl. sntisepUc. and toilet preparations. "(c) Flavoring extracts, sirups, and food products. "(d) Scientific, chemical, mechanical, and indusMsl products. " Any person who shall knowingly sell any of the products enu- merated in paragraphs (a), (b), (c). or (d) for intoxicating bever- age pxirposes, or who shall sell any of the same imder ciraimstsncss from which he might reasonably deduce the Intention of tbe pur- chaser to use them for such purposes, shall be subject to ths penalties provided for in section S3 of this act." The CHAIRMAN. The question is on the amendment of- fered by the gentlewoman from New Jersey. The amendment wsis agreed- to. The Clerk read as follows: ' Sxc. 9. 7a) No Individual, partnership, association, or corpora- tion shall, within the District of Columbia, manxifacture for sale, keep for sale, or sell any alcoholic beverage without having first obtained a license under this act for such manufacture or sale. excs, aald bever- ages may be sold and served in the private room of a membei or guest of a member, or to persons seated at tables. No license shall be Issued to a club wnlch has not been established for aj le;\at 3 months Immediately prior to the making of the applica- tion for such license. No spirits shall be displayed by an] licensee licensed under this paragraph, or his agents or employees In the space In which said beverages are sold or served, excepj ■uch spirits as may be expressly ordered by a customer. The fee for such a license shall be for a restaurant, $500 pel annum; for a hotel, $1,000 per annum; for a club. $250 per an- num; for a marine vessel serving meals. $50 per month or $50( per annum; and for each railroad dining car or club car, $5 pel month or $50 per annum. (h) Retailer's license, class D: Such a license shall be l88ue< only for a bona flde restaurant, tavern, hotel, or club, or a pas 8enger-carr>lng marine vessel serving meals, light lunches, oi sandwiches, or a club car or a dining car on a railroad. Such i license shall authorize the holder thereof to sell beer at the plac< therein described for consumption only In said place. Except ii the case of clubs and hotels, no beer shall be sold or served to ) customer In any closed container. In the case of restaurants taverns, passenger-carrying marine vessels, and club cars or dinln] cf.rs on a railroad, said beer shall be sold or served only to person seated at public tables or at t>ona flde lunch counters, except thai beer may be sold or served to assemblages of more than six indi viduals in a private room when such room has been previously approved by the board In the case of hotels, beer may be soh 1 and served only In the private room of a registered guest or teer ". Insert the words " and light wines." The committee amendment was agreed to. The Clerk read the following further committee amend- ment : Page 18. line 5, after the word " beer ". insert the words " and light wines." The committee amendment was agreed to. The Clerk read the following further committee amend- ment: Page 18, line 13, strike out "$75" and insert " $100." The committee amendment was agreed to. The Clerk read the following further committee amend- ment: Page 18. beginning In line 16. after the word " meals ", strike out the comma and the words " or a club car or a dining car on a railroad." Mr. O'CONNOR. Mr. Chairman, I rise in opposition to the committee amendment. Mr. Chairman, I appreciate the reason why the committee may have adopted this amendment. In all the license bills throughout the States they have licensed railroad cars and club cars on the railroads. The idea seems to be that a railroad car — a dining car or club car — spends so little time either in the station in Washington or in passing through the District that it is not worth while to license it. Of course, it is up to the railroads whether they desire to pay the fee for the license for a railroad car; but if a railroad car has a license all the way from Buffalo down to Washing- ton and is going south to Florida it seems to me rather peculiar that it may not get a license while in the District of Columbia. i If the railroads do not want to pay for the license, that is another matter; but if they wish to procure a license, I think they should be entitled to that license, because sometimes the cars do stay in the station for an hour or two waiting to take on passengers who are going to Florida, If they must close their doors, if they must refuse to .serve liquor, if they must determine Just the exact moment when they reach the line of the District of Columbia and when they leave it at the other end going south, that in itself will make confusion, and it will make for violations of the law. I think the committee might well let these railroad cars which come into the Dis- trict have the same privileges which they have in other States, and if they desire to pay this license fee, which, I understand, was in the original bill $50 per car per year, let them do it, and let them sell liquor while they are in the District, I cannot see anything to be gained by prohibiting the sale of liquor as soon as they pass the District line, wher- ever it is, and allow them to open when they get into Vir- ginia. I think it is a minor thing that should not be put in the bill. Mrs. NORTON. I may say, in answer to the gentleman from New York, that the committ3e did not feel justified in asking the railroad comnanies to pay a license fee for the very short time the cars are within the District of Columbia. It was estimated in the committee that there were very few trains which remained in the District more than a few moments, and the committee did not feel justified in asking them to pay a license fee for that short time. Mr. O'CONNOR. Will the gentlewoman yield? Mrs. NORTON. I yield. Mr. O'CONNOR. But what I am getting at is this: Of course, they cannot sell liquor while in the District of Columbia unless they pay the license fee? Mrs. NORTON. Exactly. Mr. O'CONNOR. If they are willing to pay the license fee, why do you not let them do it? Mrs. NORTON, I understood they preferred not to pay. Mr. O'CONNOR. If they do not pay the license fee, they just cannot sell it, but what I would like to see provided for is that if they are willing to pay the license fee. they shall have the same privilege in the District of Columbia as they have in any other State. It is up to them whether they will go to that expense or not. Mrs. NORTON. That is true, but my understanding is that they preferred not to pay the license fee because of the very short time they were in the District. Mr. O'CONNOR. Their preference does not enter Into the question of what kind of liquor control law we should pass. Mrs. NORTON. But it does enter into whether or not the Committee considers it fair or just. Mr. O'CONNOR. It Is imaginable that nobody might feel like paying the tax you have placed on a distillery here, but at the same time we are providing for that tax. That is entirely up to the distillers. I think we should give the railroads the right to sell liquor in the District if they will pay the fee, and if they do not pay the fee they just cannot sell it. Mr. PALMISANO. WiU the gentleman yield? Mr. O'CONNOR. I yield. Mr. PALMISANO. Mr. Chairman, I do not think the committee considered not giving the railroads a license. There is no objection to giving them a license. As the lady from New Jersey stated. I think the question was that they did not prefer it. Of course, I can readily understand the position of the gentleman from New York. As far as the committee was concerned, we had no objection to per- mitting a $5 license fee, but we understood they did not want it. and for that reason we eliminated it. Mr. KVALE. Will the gentleman yield? Mr. PALMISANO. I yield. Mr. KVALE. Even if that language did remain in the measure, there is nothing compulsory upon the railroads to avail themselves of it. Mr. PALMISANO. As a member of the committee, I do not think the committee as a whole cares whether it is elimi- nated or not. We simply went along with the request made. We had no objection. If you want to permit it. let it stay. The CHAIRMAN. The question is on agreeing to the committee amendment. The committee amendment was rejected. The Clerk read as follows: Committee amendment: Page 18, line 99, etrlkc out the word " restaurants " and insert the word* " reetavirants and." The committee amendment was agreed to. The Clerk read as follows: Committee amendment; Page 18, line 98, aftar the word " vessels ". strike out the words " and club can or dining cara on a railroad." Mr. O'CONNOR. Mr. Chairman, I rise in opposition to the aniendment. In view of the fact the committee amendment Just above relating to lines 16 and 17 was not agreed to, this committee, in order to be consistent, should strike out all reference to the same subject. Mrs. NORTON. I may say that the committee will with- draw this amendment. It really makes very little difference whether or not it remains. The CHAIRMAN. Without objection, the committee amendment will be withdrawn. There was no objection. The Clerk read as follows: Committee amendment : Page 18. line 24, after the wwd ** wine •*, insert the words " except light wines." The committee amendment was agreed to. The Clerk read as follows: Committee amendment: Page 19, line 1, after the word "beer", insert the words " and light wines." The committee amendment was agreed to. The Clerk read as follows: ' Page 19, line 10, after the word " beer ", add the words " and light wines." The committee amendment was agreed to. The Clerk read as follows: Page 19, line 17, after the word " spirits ". insert the words " nor wines, except light wines." The committee amendment was agreed to. The Clerk read as follows: Page 19, line 21, after the word " spirits ", Insert the words " and wines." The committee amendment was agreed to. The Clerk read as follows: Page 19, line 24, after the word " hotel ", Insert " under 100 rooms, $500 per annum; for a hotel of 100 or more rooms, $1,000." The committee amendment was agreed to. The Clerk read as follows: Page 20, line 2, after the word " annum ", strike out the words " and for each railroad dining car or club car, $5 per month or $50 per annum." Mrs. NORTON. Mr. Chairman, the committee will with- draw this amendment. The CHAIRMAN. Without objection, the committee amendment will be withdrawn. There was no objection. The Clerk read as follows: Committee amendment : Page 20, line 8. after the word " sand- wiches ", strike out " or a club car or a dining car on a railroad." Mrs. NORTON. Mr. Chairman, the committee will with- draw this amendment. The CHAIRMAN. Without objection, the committee amendment will be withdrawn. There was no objection. Mr. KVALE. Mr. Chairman, I ask unanimous consent to proceed for 1 minute. •nie CHAIRMAN. Is there objection to the request of the gentleman from Minnesota? There was no objection. Mr. KVALE. Mr. Chairman, I call attention to the com- mittee amendment which was agreed to, on page 18, line 22. ^r-^ .rf"v -v T r^ "W^ «^«r f\ 1Q514 rONORFSSTOMAT, PP.PnPn HnTTCi;! CONGRESSIONA]-. RECORD— HOUSE 288 It was an amendment merely clarifying and correcting tt e language. It Is unnecessary. In view of the later amem - ment. In view of this, perhaps the action of the oommltt^ should be reconsidered. The Clerk read as follows: Committee amendment: Page 20, Une 13, after the woi d " taverns ". Insert the word " and." The committee amendment was agreed to. The Clerk read as follows: Committee amendment: Page 20. line 14, after the wed " vessels ". strUte out " and club cars or dining cars on a rail- road.' The CHAIRMAN. Does the gentlewoman from New Jei sev desire to withdraw this particular amendment? Mrs. NORTON. Mr. Chairman. I shall withdraw iU amendments pertaining to this particular clause. The CHAIRMAN. Without objecUon, the amendment w^n be withdrawn. There was no objection. The Clerk read as follows: Committee amendment: Page 21. line 8. strike out the figxnes "$150 ' and Insert In lieu thereof the flgtves "$200." The committee amendment was agreed to. The Clerk read as follows: Committee amendment: Page 21. line 21. after the wo^d " beer ', Insert the words " and light wines." The committee amendment was agreed to. The Clerk read as follows: Committee amendment: Page 22. line 5. strike out all of sv^ section •• K " and Insert in lieu thereof the following: " K. Solicitor's licenses : Such a license shall authorize the licensee to offer for sale to or solicit CM-ders from licensees for t tie sale of any beverage if the vendor of such beverage is the holt er of a manufacturer's license class A or class B, or a wholesaler's license class A or class B. Issued under this act, authorizing suph sale." The committee amendment was agreed to. Mr. WEIDEMAN. Mr. Chairman, I offer an amendment. The Clerk read as follows: Amendment offered by Mr. Wkidxman: Page 18. commencihg with the word "and". In line 18. strike out through the wcrd "place". In line 20, and Insert in lieu thereof the foUowlEg: "at the place described therein and to seU spirits, wines, aid beer on the ground floor only of said place for consumption sn such ground floor only which said place of sale shall be eziKi^ed to public view." Mr. WEIDEMAN. Mr. Chairman. I wish to draw t^e attention of the Members on this side of the House to the pronsions of the Democratic platform, imrticularly the por- tion reading as follows: We advocate the repeal of the eighteenth amendment. To effbct such repeal we demand that the Congress Immediately propose a constitutional amendment, to truly representative conventions in the States called to act solely on that proposal; we urge the enast- ment of such measures by the several States as will actually pro- mote temperance, effectively prevent the return of the saloon, snd bring the Liquor traffic into the open under complete supervision tad control by the States. WK MUST KKXP rA.rrH WITH TBS oommtT Under the bill as at present drawn there Is nothing to bring liquor in the open in a so-called " night club ", wh ch is an invention of the prohibition era. Such a club on jhe second floor is entirely concealed from public view, suid tney will sell liquor in httle 2-by-4 cubbyholes, as they do lat present in our speak-easies. Girls of the tenderest age ire admitted to such places. They place no limitation on he age of those who may enter; so if friends of temperaitce really want to do something to help us keep the liberty we have gained after such a long fight and really make cont rol effective, we should bring this thing out into the opm. Otherwise we will have the bootlegger as we did in the di lys of prohibition. They will be selling their wares in the ba se- ments and on the second floors, behind closed doors and in back of partitions and curtains, where the youth of the la nd will be sold liquor as at present. As far as I am concerned. I am willing to do my drink ng in the open. If you reall;/ want temperance, open tikise places to public view where people can see what is going )n. January 9 In the State of Bilchigan they legalized beer gardens, but in the front windows of all these beer gardens are signs and draperies, and the result is one cannot see what is going on Inside, resulting in indiscretions which would not happen if these places were open to public view. As a result. 75 percent of the people in those beer gardens are young people. We have a *' sitting down " clause there, too. and they sit until they are intoxicated on the stuff they are selling now. This does not promote the cause of temperance. If we are really sincere in this, we ought to effect the open sale of liquor. The bill here is just about as close to a saloon as we can get. We do not call it that in the bill, but a name does not mean anything. I think the sooner you bring it out in the open the less intemper- ance you will have. WI DKMAND THAT SPIAK-SASISS BI ABOLISHXD I am sure that the millions of decent, law-abiding citi- zens of this country who voted to repeal the eighteenth amendment did so with the belief that our new order of things would protect the youth of the country, that the new order would not countenance speak-easies or bootleg parlors; that the repeal would promote obedience to law. and would abolish the racketeer and the bootlegger, and would stop the indiscriminate selling of liquor to the youth of the cotmtry. We should put these principles into effect. Mr. O'CONNOR. I sympathize with what the gentleman says, because I believe America has never known how to handle the liquor traffic. I have always advocated it being in the open, but you have to be practical about it. Does the gentleman mean by that amendment that even a hotel or club could not sell it on the second floor? Is that the purpose? Mr. WEIDEMAN. This would apply to every holder of a retail -license class. Mr. O'CONNOR. That is. clubs and hotels? Mr. WEIDEMAN. It includes all of them. Mr. O'CONNOR. Be practical about it. Some hotels have nothing on the first floor. The Press Club here in Washington is on the thirteenth floor. You would bar the Press Club. Some of the country clubs have nothing but lockers on the first floor. You would bar them. I would go along with the gentleman to the extent of having no blinds on the windows, but I do not agree with the gentleman as far as hotels are concerned. Mr. WEIDEMAN. Let me interrupt the gentleman. I will accept an amendment to except clut)s. Mr. BOILEAU. Will the gentleman yield? Mr. WEIDEMAN. Yes. Mr. BOILELAU. I call the attention of the gentleman to the fact that in the city of Washington some of the best managed restaurants are on the second floor. I cannot see that there is any justiflcation in exempting hotels and clubs. I do not care to mention the particular restaurants I have in mind, but I am sure you have been to some of the places I refer to. These restaurants have two floors. Mr. WEIDEMAN. I know the place the gentleman re- fers to. Mr. BOILEAU. I think it would be wrong to exclude them from the privilege of selling liquor. Mr. WEIDEMAN. I would like to answer the gentleman from Wisconsin, It is unfortunate that in any restriction someone has to .suffer, but inasmuch as we are trying to bring liquor out into the open it is too bad if the restaurant is on the second floor. They will have to move downstairs where it will be out in the open. The people were not so much interested in preventing the return of the saloon as they were in suppressing drinking behind curtains and closed doors and in speak-easies. That is what the people wanted particularly to suppress. Mr. BOILEAU. Does not the gentleman believe that there is some way to reach that problem without making an arbi- trary rule along this line against well-managed restaurants? Mr. WEIDEMAN. Nevertheless, we must be flrm in our demand to live up to our platform, and protect those people who need protection. The so-called " wets " brought about prohibition before. Let us protect ourselves against the /-1/^xTnT>T^'C^ClTrvXT A T T>J?nr\T>T\ IinTTGT? Tamttapv 0 1934 CONGRESSIONAL RECORD— HOUSE selfish Interests of today. The friends of liberalism must protect this new liberty which we have acquired. The cause of liberalism must not be allowed to be " sold short " by the predatory interest*— more Interested in capitalizing on repeal for their personal gain than in keeping the rights newly acquired. Mrs. NORTON. I rise in opposition to the amendment. I think the gentleman's amendment is not practical. It would be utterly impossible to enforce such a regulation, Just as impossible as it was to enforce the eighteenth amendment. We know perfectly well that such a provision would be vio- lated ; afTd, as has been so well stated, there are a great many restaurants, and there are a great many hotels, that would certainly suffer as a result of this amendment. I do not think it would bring about any greater degree of temperance. In fact it would probably cause the same disrespect for the law we have experienced during the past 14 years, and which we hoped we were through with when the eighteenth amend- ment was repealed. So, Mr. Chairman, I hope this amend- ment will not be agreed to. The CHAIRMAN. The Clerk will report the modified amendment. The Clerk read as follows: Amendment by Mr. Weideman: Page 18. commencing with the word " and " In line 18, strike out through the word " place " In line 20. Insert In lieu thereof " at the place described therein, and to sell spirits, wine, and beer on the ground floor only in said place for consumption on such ground floor only, which said place of sale shall be exposed to public view, except this pro- vision shall not apply to incorporated clubs or hotels." Mr, McPARLANE. Mr. Chairman and Members of the Committee, I rise in opposition to the modified amendment of the gentleman from Michigan. I am in favor of the amendment as originally offered. Referring back to our Democratic platform, the threefold provision that we have heard so many times this afternoon is: First, to promote temperance; second, to effectively pre- vent the return of the saloon; and third, to bring the liquor traffic into the open under camplete supervision and control by the States. This amendment is directed to the third fea- ture of this regulatory provision on liquor of the Democratic national platform. In the Republican platform the provi- sion is more stringent than ours. LET trs KEEP FArrH wrrH our platform There is no use kidding ourselves. As has been said repeatedly on the fioor this afternoon, the saloon is coming back. In fact, it is already here. The question is. Are we going to keep faith with our own platform and have the Members on this side of the aisle drive the liquor traffic into the open, effectively regulate it, and promote temi>er- ance in every way? THE DISPENBART SYSTEM The majority of this House voted against the dispensary system. That system would, I believe, very largely have taken the profit out of the liquor business and would have kept the distillers and the brewers of this country from con- trolling the politics of the Nation. We have not promoted temperance in the bill before us, because it is admitted that the saloon is back and will be operated in a wide-open fashion as of old. It is true the bill does not define the word " saloon ", but Webster's Dictionary and Bouvier's Dic- tionary and others define it as " anywhere intoxicating liquor is sold." Are we this afternoon going to wink at every provision of our platform and say by our vote that we are unwilling to bring the liquor traffic into the open, so that all who see may know who is drinking, and so that we may protect, in a measure, the oncoming generation from inhabiting the saloons which this bill is now establishing? LET trs 8XTPEBVISX AND CONTROL, NOT TTTRN THEM LOOSE I was amused at my friend the gentleman from New York [Mr. O'Connor] and his suggestion to the gentleman from Michigan [Mr. Wkideman] that we ought to bar from the provisions of the amendment the hotels and the clubs from those who are not to sell liquor above the first floor. If you do this, you kill the effect of the amendment entirely. The gentleman from Wisconsin [Mr. Boxlkav) comes along and says that we have many restaurants above the first ]k>or and they ought to be exempted also. Mr. Chairman, we ought to keep this saloon business down on the ground floor and keep the blinds back, as we did by regulations before pr<^bition. so we can run them out in the open in the best way we can and keep reasonable order, or as reasonable as we were ever able to keep. You know what brought on prohibition. It was largely because of lack of regulation and lack of respect for law and the side-door entrances that brought In the women and children and brought about many other abuses with which we are all familiar. Are you going to sit by blindly and allow the same abuses to be permitted? This is what you are going to do U you continue to vote down these proposed amendments. I hope you will at least adopt a great many of the amend- ments now pending and also vote for the amendment now before us. Mr. BOLAND. Will the gentleman yield? Mr. McPARLANE. I yield. Mr. BOLAND. With respect to the gentleman's state- ment about what brought on prohibition. I believe that the thing that principally brought on prohibition was the United Brewers' Association of America. Mr. McPARLANE. In answer to the gentleman, I may say that we had the brewers' association in my own State to corrupt the politics of Texas. They gave to the then Oov- ernor of our State $156,000, which caused his impeachment. The politics of our State was rotten to the core, and I am sure the gentleman is familiar with similar situations of corruption in other States. [Applause.] [Here the gavel fell.] Mr. OLIVER of New York. Bir. Chairman, I think the gentleman from Texas [Mr. McParlane] is a little wrong about his interpretation of the platform about bringing the liquor business into the open. This has nothing to do with giving the public the right to look into your window when you are sitting at your dinner to find out what you have on the table. We intended to bring it into the oitea so that you could send a brewer's truck through the city streets where every- body could see it. We intended to bring it into the open so that the man selling liquor would have a legal business which he would openly conduct and the entire public would know that he was conducting this business. But we never intended to go back to that old, dreadful censorship where everybody could spy on everybody else at any time anyone was taking a glass of beer or a glass of wine. Sometime someone might be giving a nice party in a hotel and would be buying liquor and having a dance. There would be fine people there. Including his oldtlme comrades and pals. Does the gentleman from Texas think it was Intended by the Democratic platform that the whole world had a right to stand at the window and look on and say, " Oh. there is Jimmie Jones, he is taking a Scotch highball. Tliere Is Johnny Smith, he is taking a rye highball — isn't that ter- rible? " This Is Just the thing we wanted to get away from. Privacy in drinking is one of the things we have fought for and won in the last campaign, and if the gentleman from Texas wants to know how the country stands, let him ask the people of Texas whom he represents, and tiiey will tell him that they want none of this oldtlme censorship or espionage which disgraced American public life. I believe we ought to have the right to drink liquor prac- tically any place we want to drink It. Temperance will come from the self- liquor, but did we not have enough of it under the dr^ cause? Did we not see all political conventions controUel by a pack of fanatics? Did we not see the type and kinl \ of men who came to govern the Nation become mere black- mailers and extortioners? They speak of corrupt control of liquor. We do not a^ that there be any stopping of censorship of corruptioi^. We want the whole power of government to destroy corruri- tion, but you get more comiption by narrow censorship tha i you will get by liberal administrative action. [Applause! The CHAIRMAN. The question is on the amendmert "^ offered by the gentleman from Michigan [Mr. Whdeman . The amendment was rejected. Mr. O'CONNOR. Mr. Chairman, I offer the followirg amendment, which I send to the desk. The Clerk read as follows: Amendment by Mr. O'Connok: On page 15, line 19. strike out " 2.000 ■' m each instance and insert " 3.500." Mr. O'CONNOR. Mr. Chairman, the piu-pose of ths amendment is to fix the license fee of a rectifying plant < r a distillery at $3,500. I do that because the bill, on page 1 !, fixes the license fee of a brewery at $2,500. I believe tie license fee of a distillery or rectifying plant should be moj e than the license fee of a brewery in proportion. Mrs. NORTON. Mr. Chairman, the committee will acce] >t that amendment. The CHAIRMAN. The question is on agreeing to tlie amendment offered by the gentleman from New York. The amendment was agreed ta Mr. O'CONNOR. Mr. Chairman. I offer the followirg amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. O'Connok: Page 19, line 17, after tlie period following the word " license ", strike out all of tbe r t- inainder of tbe paragraph. Mr. O'CONNOR. Mr. Chairman, as I read this provisicn on page 19, beginning in line 17, it provides that none of these spirits or wines or beers in any of these places can \e exposed to the public view. In other words, Uie bartender has to reach under the counter for the bottle. If it is pei - missible to sell the stuff, it ought to be seen by the publ c ~^ before the public buys it. A man ought to be able to look i it the bottle and the label and see what he is getting. Mrs. NORTON. Mr. Chairman, the committee will acce; )t the amendment. The CHAIRMAN. The question is on the amendment offered by the gentleman from New York. The amendment was agreed to. Mr. O'CONNOR. Mr. Chairman, I offer the followirg amendment, which I send to the desk. The Clerk read as follows: Amendment offered by Mr. O'Conmok: Page 21. line 11, aftsr tbe word ** physician ", Insert " for liquors as defined by tJ le tlnited States Pbarmacopcela." Mr. O'CONNOR. Mr. Chairman, the purpose of this amendment is to prescribe that a drug store, which under this bill is entitled only to furnish liquor on physician's pre- scriptions, must furnish what is well known to physicians i tr pharmacists as " liquor." The United States Pharmacopce a describes whisky or spirltus frumenti as liquor aged n wood 4 3rears, and if a physician gives a prescription f i r spiritus frumenti the druggist should not be able to fill it with a blended or rectified or a " cut " whisky, which is n )t whisky aged 4 years, and which is injurious to some peop|e, either infants or old people. The dmggist should be restricted to what is well known 4s " spiritus frumenti ", as defined by the United States Pha - macopoeia. No one can complain about that. The druggis s can only seU liquor on prescriptions now. Here is what w 11 happen tf this amendment is not agreed to. The decent physician will prescribe " spiritus frumenti ", but some dru ; gists will have on hand their pet paid physicians — and some have them permanently on the job — who will prescribe " blended " or " compounded " whisky, which is not proper prescription whisky at all. If you provide that every pre- scription shall be under the well-known definition of "spiritus fnunenti" of the United States Pharmacopceia, you will meet and destroy that fraud on the public. The respectable physicians and the District of Columbia Phar- maceutical Association endorse the idea, as do also the honest druggists in the District. Mrs. NORTON. Mr. Chairman, I see the sense of that and the committee will accept the amendment. The CHAIRMAN. The question is on agreeing to the amendment offered by the gentleman from New York. The amendment was agreed to. The Clerk read as follows: See. 12. The holder of a manufacturer's or wholesaler's license Issued hereunder shall not be entitled to hold any other class of license. No retailer's license class A or class B shall be issued or remain In force in respect of any premises for which a retailer's license class C or class D has been issued. A person, not licensed hereunder, owning an establishment for the manufacture of bever- ages may hold one wholesale license, and shall not be entitled to hold any other license. With the following committer amendments: Page 23. line 1, after the flgmes " 12 ", insert "(a)." Page 23, after line 9. Insert: "(b) No licensee holding a retailer's license, except a retailer's license class E, by direct ownership, stock ownership, or interlock- ing directors shall hold directly or indirectly any other retailer's license. When used in this subsection the word ' license ' shall include any stockholder holding directly or indirectly 25 percent or more of the common stock or any officer of such licensee if sucli licensee is a corporation." The committee amendments were severally reported and severally agreed to. The Clerk read as follows: S«c. 14. (a) Any individual, partnership, or corporation desirin;? a license under this act shall file with the board an application la such form as the Commissioners may prescribe, and such applica- tion shall contain such additional Information as the boord may require, and (except In the case of an application for a mi-nufac- turer's, retailer's license class E, or solicitor's license) shall con- tain a statement setting forth the name and address of the true and actual owner of the premises upon which the business to be licensed is to be conducted. Before a license Is issued the board shall satisfy itself: 1. That the applicant, if an individual, or. if a partnership, each of the members of the partnership, or if a corporation, each of its principal ofBcers and directors, is of good morsd character and generally fit "for the trust to be in him reposed. 2. That the applicant, if an individual, or, if a partnership, each of the members of the partnership, or, if a corporation, each of its principal officers, is a citizen of the United States, not less than 21 years of age, and has never been convicted of a felony. 3. Except in the case of an application for a solicitor's license, that the applicant is the true and actual owner of the business for which the license is desired, and that he intends to carry on the bxisiness authorized by the license for himself and not as the agent of any individual, partnership, association, or corporation, and that he intends to superintend in person the management of the biLsiness licensed, or intends to have some other person, to be approved by the board, manage the business for him, which said manttger must possess all of the qualifications required of a licensee hereunder. 4. That in the case of an applicant for a wholesaler's license or a retailer's license (except a retailer's license class E), no manu- facturer or wholesaler of beverages other than the applicant (in- cluding a stockholder holding 25 percent or more of the common stock, or an olBcer of any manufacturer or wholesaler of bever- ages, if such manufacturer or wholesaler is a corporation), has such a substantial Interest, direct or Indirect, in the business for which the license is requested, or in the premises in respect of which euch license Is to be issued, aa in the Judgment of the board may tend to influence such licensee to purchase beverages from such manufacturer or wholesaler, and that such business will not be conducted with any money, equipment, furniture, flx- tures. or property rented from or loaned cr given by any such manufactvirer or wholesaler (including such stockholder or officer) or sold by such manufacturer or wholesaler (including such stock- holder or officer) to any such licensee for less than the fair market value or upon a conditional sale agreement or chattel trust. 5. That the place for which the license is to be issued is an appropriate one considering the character of the premises, its sur- roundings, and the wishes of the persons residing or owning prop- erty in the neighborhood of the premises for which the license la desired. 1934 CONGRESSIONAL RECORD—HOUSE 291 (b) Before gnmtlng a retailer's license, except a retailer's license class E or class F, the board shall give notice by advertisement published once a week and for at least 2 weelLS in some news- paper of gentiral circvilation published in the District of Columbia. The advertisement so published shall contain the name of the applicant and a description by street and nvmiber, or other plain designation, of the particular location for which the license is requested and the class of license desired. Such notice shall state that remonstrants are entitled to be heard before the granting of such licenses and shall name the time and place of such hearing. There shall also be posted by the board a notice, in a conspicuous place, on the outside of the premises. This notice shall state that remonstrants are entitled to be heard before the granting of such license and shall name the same time and place for such bearing as set out in the public advertisement; and if remonstrance against the granting of such license is filed, no final action shall be taken by the board until the remonstrant shall have had an opportunity to be heard, under rules and regulations prescribed by said board. Any person willfully removing, obliterating, mar- ring, or defacing said notice shall be deemed guilty of a violation of this act. (c) Except In the case of a retailer's license class C, to be issued for a hotel or club, or a retailer's license class B or class E. no place shall be deemed appropriate if the owners of a majority of the real property within a radius of 600 feet of the boundary lines of the lot or parcel of ground upon which is situated the place for which the license is desired, shall, on a form to be prescribed by the Commissioners and filed with the board, object to the granting of such license. In determining the sufflciency of such objections the owners of all such property not lying within a resi- dential-use district as defined in the zoning regulations and shown In the official atlases of the Zoning Commission shall be taken as consenting to the granting of such license, except that the Com- missioners shall have power to file objections on behalf of any property lying within such radius owned by the United States or the District of Columbia. This subsection shall be construed as a limitation upon the discretion of the board in granting a license and not as a limitation upon the discretion of the board In refus- ing a license. id) A separate application shall be filed with respect to each place of business. The required license fee shall be paid to the collector of taxes and his duplicate receipt shall accompany the application for license. In the event the license is denied, the fee •hall be returned. Each application (except an application for a retailer's license class P or a solicitor's license) shall be ac- companied by a bond on a form to be prescribed by the Com- missioners, executed by the applicant with corjxjrate surety ap- proved by the board, in the penal sum of $1,000, said bond to run to the District of Columbia and be conditioned upon the payment by the applicant of any and all taxes due the District of Columbia under this act and any and all fines that may be Imposed upon the applicant under this act. Said bond shall not become operative unless and until the license applied for Is Issued, and in the event said application Is denied said bond shall be returned. Every such application shall be verified by the affidavit of the applicant, if an individual, or by all of the mem- bers of a partnership, or by the president or vice president of a corporation. If any false statement is knowingly made in such application, or in any accompanying statement under oath which may be reqfalred by the Commissioners or the board, the person making the same shall be deemed guilty of perjury. The making of a false statement in any such application or in any such ac- companying statement, whether made with or without the knowl- edge or consent of the applicant, shall, in the discretion of the board, constitute sufficient cause for the revocation of the license. With the following committee amendment: Page 27, line 21, at the beginning of the line insert the words •' or class D." The committee amendment was agreed to. Mr. BLACK. Mr. Chairman, I offer the following amend- ment, which I send to the desk. The Clerk read as follows: Amendment by Mr. Black : Page 28. after the word " license ". In line 15, insert the following: " Provided, however. That none of the provisions of this act shall prevent the board from promulgating regulations to permit the lawful, bona fide owners of warehouse receipts for bonded liquors stored in Government warehouses, either in the District of Columbia or elsewhere, from withdrawing such bended liquors for personal use on payment to the collector of taxes for the District of Columbia of taxes at such rates as provided in this section: Provided, That such bona fide holders of such warehouse receipts held legal title to such warehouse receipts prior to the passage of this act." Mr. BLACK. Mr. Chairman, this amendment is in the interest of various people who now hold warehouse receipts for liquor. It is the same situation as was met in the several States, but not met with so well. For instance, in Mary- land the holder of a bona fide warehouse certificate for liquor could not get his liquor directly himself, but must go to a wholesaler who bad a license, and the practice has grown up of the wholesaler charging the bcdder of a ware> house certificate various amounts of money for the servloe given. By this amendment the holder of the warehouse certificate having Uquor now in a warehouse cmd there be- fore the act, can, by pajring the proper tax. submit the cer- tificate and get his liquor. Mr. BRITTEN. Will the genUeman yield? Mr. BLACK. I yield. Mr. BRITTEN. Has this amendment been taken up with either of the District Commissioners? Mr. BLACK. No; it has not. Mr. BRITTEN. The amendment sounds Tery food to me. Mr. BLACK. I think it was overlooked. That is all. Mr. McFARLANE. Will the gentleman yield? Mr. BLACK. I yield. Mr. McFARLANE. I should like to ask what change that makes in the existing law in regard to the withdrawal of liquor? Mr. BLACK. Nothing, except that evenrthing is changed by the repeal of the eighteenth amendment. By the repeal of the eighteenth amendment and by this act the whole system is changed. Mr. McFARLANE. Is there anything in this bill in re- gard to the withdrawal from warehouses? Mr. BLACK. I do not think so; no. Mr. McFARLANE. I make the point of order that the amendment 15 not germane. The CHAIRMAN (Mr. Johksok of Oklahoma). The Chair overrules the point of order. The point of order comes too late. The question is on agreeing to the amendment offered by the gentleman from New York [Mr. Black]. The amendment was agreed to. Mr. O'CONNOR. Mr. Chairman, I offer an amendment. Tlie Clerk read as follows: Amendment offered by liCr. O'Connok: Page 28, line 3i. aftar the word " with ", strike out the word " corporate." Mr. O'CONNOR. Bdr. Chairman, one can imagine the number of applications which will be filed with this board for the 11 forms of licenses to be granted in the District of Columbia. Somebody, surely not the c(»zunittee. but some fine Italian hand downtown, has inserted in this bill a pro- vision that everybody must give a surety bond by a surety company, a corporate surety bond. The applicant could not give a bond secured by real-estate owners or by the wealthiest man in the District of Columbia. The surety companies practicing in the District must get all of these bonds or none at all. I am sure if that monopoly were brought to the attention of the District Committee, the word " coriwrate " would have been stricken from the bill, and the ordinary security or surety that is taken in a court, or any- where else, would be accepted from an applicant for a license imder this bill. Mr. BLACK. I wish to be heard on the amendment, lii. Chairman. I would not think that ordinarily there would be any objection to the amendment, but inasmuch as we have proceeded as far as we have on this bill, I think the accept- ance of this amendment would require several changes in the blU, and the amendment o£F«red by the gentleman from New York, to a large extent, should be qualified. For instance, we have tried in this bill to separate the retail licensee from the wholesaler as much as possible. We have tried to keep the licensee from having an interest in more than one place. The bonding provision, if not properly restricted, might per- mit a professional bondsman to obtain control of the situ- ation. So that if we are going to take the amendmmt at all, I think the gentleman frcnn New York should protect the bill from any such situation arising. It does not make any difference to us whether or not it is a corporate surety or an individual surety, except that in addition to the provi- sions of the bill the corporate surety is surrounded by other forms of public protection. There has been a great deal of evil due to the individual sureties. It makes no difference to us, except that it is late in the day and we have goat along 292 CONGRESSIONAL on this bill on the basis I have stated, and if the gentlemai is very anxious about his amendment the committee migh accept it if the gentleman would modify the amendment t< > take care of the situation I have mentioned- Mr. O'CONNOR. I have examined the bill very carefully and I see nothing inconsistent with striking out the wor< "corporate." As to individuals going siffety or bail for violations of the law you have provided for in anothe: section. Mr. BLACK. For Instance. I want to point this out Under the gentleman's amendment a distiller might be th( t bondsman for the applicant. That is entirely against thi! theory of this bill. Mr. O'CONNOR. Oh. no; that is provided for in anothe ■ place. Every applicant could either take a corporate suret; ' company as bondsman or furnish other bondsmen, but non ; of the bondsmen should be connected In any way with hi; business or the liquor business. This Just means that you prevent a monopoly on the part of the surety companie> here. Mr. BRITTEN. Will the gentleman yield? Mr. BLACK. I yield. Mr. BRITTEN. I hope the gentlemen having this bill li i charge will agree to the amendment. It Is more or les; unimportant, but it does do one thing: A small store is operated by a man. and that man owns his own propert^f. and he can go there and. with the assistance of his wife am 1 relatives, schedule a bond that will save him a few dollars in payment of premium on a corporate bond which would otherwise be necessary. Mr. BLACK. I would be willing to suggest to the com- mittee that it accept the amendment with a proviso pro- viding that no surety shall have any financial interest in th ; btisiness of the licensee. Mr. BRITTEN. There Is no objection to that, but this i ; not the proper place for the amendment. This is a Ion ; section. Hie gentleman's amendment will not fit at thi > place. Mr. BLACK. The suggestion has been made that thi> Committee vote down the O'Connor amendment and wi; shall offer later an amendment containing the restriction. The CHAIRMAN. The question is on the amendmen; offered by the gentleman from New York [Mr. O'Connor]. The amendment was rejected. Mr. BOILEAU. Mr. Chairman, I offer an amendment. The Clerk read as follows: Amendment offered by Mr. Botleau: Page 27. line 22. after th> word "place", insert the foUowing: "for which a licenee unde' thia act haa not been issued and in effect on the date the writtei i objections hereinafter provided for are filed." Mr. BOILEAU. Mr. Chairman, I call the attention of th ; distinguished chairman of the committee and the members of the committee to the provisions of subsection (c) of sec - tion 14, on page 27. This subsection provides that if f majority of the property owners within a radius of 600 f e of the place of business seeking a license object and written objections with the commission that the license s! not be granted. In other words, it does not apply solely t > the first licensing of the psurticular place of business, but i ; applies also to the licensing of the business in subsequent years. For instance. If I were to start a restaurant, or if I. hav Ing a restaurant in a residential section, obtained a licens i to seU liquor for the first srear and ran a good legltimat; business, nevertheless a majority of the residents within i radius of 600 feet could prevent me from prociiring a licens ; the second year even though I may have put a tremendou^ amount of money into equipment. Bir. PALMI8ANO. Mr. Chairman. wlU the gentlema^ yield? Mr.BOILEAn. I yiekL Mr. PALMISANO. I think the situation the gentlemaii sxiggests is taken care oi in the amendment referring t) April 5. 1933. In other words, all who have licenses toda: ' obtained the licenses since April 5. and would not be subjec ; to that proviso. RECORD— HOUSE January 9 Mr. BOILEAU. I was so told by several members of the committee. If the gentleman refers to the language on page 11, I may say that this language, beginning in line 10. forbids the issuance of any class or classes of licenses for businesses established subsequent to April 5, 1933. con- ducted near or around schools, colleges, universities, churches, or public institutions. It does not take care of the situation I have brought up at all. I can find no lan- guage in the act that does take care of this situation. I am under the impression, and it seems very clear to me from the language of this subsection, that if a majority of the owners of property within a radius of 690 feet object to an individual having his license reissued for another year, they can prevent it, even though he may have conducted his business in a very decent way. I believe the residents of a territory should have something to say about the first issuance of the license. For instance, now. before the licenses are Issued, if the people in a resi- dential section do not want restaurants. I believe they should have something to say about it. But. having permitted a man to establish such a business and invest a large amount of money in his business, it seems to me to be entirely wrong to permit some individual to buy a few pieces of property and thereby run this man out of business. Mr. BRITTEN. As long as he maintains a perfectly re- spectable place of business. Mr. BOILEAU. I believe that is taken care of in the pro- vision of paragraph 5, on page 26, which provides that the place for which the license is to be issued must be an appro- priate one, considering the character of the premises, its surromidings, and the wishes of the persons residing or own- ing property in the neighborhood of the premises for which the license is desired. It seems to me this language conveys enough power upon the board to allow them to use their own judgment and use their own discretion. I do not believe any mandatory power should be given to a few people who own property in a par- ticular neighborhood — because it is very easy for some per- son to come in there and buy up enough property to control the situation — to act to the detriment of a man who is con- ducting a legitimate business. We are putting the liquor business on a legitimate basis with proper regulations, I do not think we should have any legislation that would per- mit a httle group of fanatics to exercise such arbitrary power. I hope the committee will accept this amendment. Mrs. NORTON. Mr. Chairman, it would seem to the com- mittee to be a reasonable amendment and the committee is inclined to agree with the gentleman. The CHAIRMAN. The question is on the amendment offered by the gentleman from Wisconsin [Mr. Boileatj]. The amendment was agreed to. Mr. BLACK. Mr. Chairman, I offer an amendment. The Clerk read as follows: Amendment offered by Mr. Black: Page 28. line 24, strike out the word " corporate " and on page 29. line 4, after the word " act ", Insert the foUowing: " Provided, That no such surety shall have, directly or In- directly, any financial interest in the business of the licensee." Mr. O'CONNOR. Mr. Chairman, will the gentleman yield? Mr. BLACK. I yield. Mr. O'CONNOR. I understand this amendment accom- plishes in part the purpose of the amendment I Just offered, but affords the protection suggested by the gentleman, namely, that the surety shall not be interested in the place he bonds. The CHAIRMAN. Tlie question Is on the amendment offered by the gentleman from New York [Mr. Black]. The amendment was agreed to. The Clerk read as follows: Sic. 20. Licenses iasued hereunder shall not authorize the sale or delivery of beverages, with the exception of beer, to any person under the age of 21 years, or beer to any person under the age of 18 years, either for his own use or fur the use of any other person; or the sale of beverages to any intoxicated person or to any person of notoriously intemperate habits or to any person who appears to be intoxicated; and ignorance of the age of any such minor shall not be a defense to any action 1934 CONGRESSIONAL RECORD— HOUSE 29S InatlUited undfer this aection. Ho Ucenaee thaU be liable to any person for damages claimed to arise from refiisal to seU audi alcoholic beverages. With the f(dIowing committee amendments: Page 34, Une 17. after the word " beer ", insert the words " and Ught wines." Tbe amendment was agreed to. The Clerk read as follows: Page 84. line 18. after the word "beer". Insert the words "or light wines." The amendment was agreed to. The Clerk read as follows: Sec. 23. There shaU be levied and collected by the District of Ck>lumbla on all beverages, except beer, manufactured by a holder of a manufacturer B license and on all beverages, except beer, pxirchased by the holder of a wholesaler's or retailer's license, ex- cept such beverages as may have been purchased from a licensee uiMler this act. a tax of 60 cents for every wine gallon of wine containing more than 14 percent of alcohol by volume or cham- pagne or any wine artiflclally carbonated, and at a like rate for any other quantity or for fractional parts thereof; a tax of 20 cents for every wine gallon of wine containing 14 percent or less of alcohol by volume, other than champagne or any wine arti- ficially carbonated, and at a like rate for any other quantity or for the fractional (tarts thereof; a tax of 50 cents on every wine gallon Of spirits, and at a like rate for any other quantity or for the fractional parts thereof; and a tax of $1.10 on every wine gallon of alcohol, and at a like rate for any other quantity or fc»r the fractional parts thereof. The taxes Imposed by this section shall be pcUd to the ooUector of taxes of the District of Ckilumbia on or before the 15th day of each month for beverages manu- factured by the holders of manufacturers' licenses or purchased by the holders of wholesalers* or retailers' licenses during the preceding calendar month, and such taxes shall be deposited in the Treasury of the United States to the credit of the District of Colvmnbia. No tax shall be levied and collected on any alcohol exempt from tax under the laws of the United States, or on any alcohol sold for nonbeverage purposes, in accordance with regu- lations promulgated by the CknnmlBslonerB. If any act of Con- gress shail hereafter prescribe for a Federal volume tax on alco- holic beverages under which a (tortVon of said tax shall be returned to the District of Columbia, the taxes levied under this section shall not be collected after the effective date of such act. Mr. BURNHAM. Mr. Chairman. I offer a committee amendment, which I will send to the desk. The Clerk read as follows: Committee amendment offered by Mr. BuamiAifC: Strike out be- ginning with tbe figure " 50 ", at line 7, page 36, and ending at the end of line 14, page 36, and Insert in lieu thereof the following: "35 cents for every wine gallon of wine containing more than 14 percent of alcohol by volume, except champagne or any wine arti- ficially carbonated, and at a like rate for any other qxiantity or for fractional parts thereof; a tax of 60 cents for every vrtne gallon at champagne or any wine artificlaUy carbonated, and at a like rate for any other quantity or for the fractional parts thereof." Mrs. NORTON. Mr. Chairman, the gentleman's amend- ment is agreed to. The committee accepts the amendment. Mr. McPARLANE. I would hke to ask the gentleman from California a question. Will he explain the effect of his amendment and Just how it compares with the liquor bill which was enacted last week concerning the tax on wines of various alcoholic content? Mr, BURNHAM, I will say for the benefit of my colleague from Texas that this amendment provides for a tax of 35 cents per wine gallon on wines above 14 percent alcohoUc content and 50 cents per wine gallon for champagne and carbonated wines. Wine below an alcoholic content of 14 percent will take the same tax as beer. Mr. COCHRAN of Missouri. Will the gentleman yield? Mr. BURNHAM. I yield to the gentleman from Missouri. Mr. COCHRAN of Missouri. This is a local tax and Is added to the Federal tax that was passed this week? Mr. BURNHAM. Yes, sir. Mr. COCHRAN of Missouri. It Is a local tax entirely? Mr. BURNHAM. Yes. Mr. WEIDEMAN. Does the gentleman's amendment lower the tax or raise it. as set forth in the District bill? Mr. BURNHAM. It is a graduated scale. It leaves the rate of 50 cents for champagnes and carbonated wines and lowers the rate on ordinary wines above 14 percent from 50 cents to 35 cents. Mr. COCHRAN of Missouri. That is in line with the gen- eral opinion of the committee, that we should lower the tax on natond grape wine as much as ire can tn order to en- courage the drlnkinc of grape wine and get away from the drinking of hard liquor? Mr. BURNHAM. Yes. TUs is In addition to the PMerai tax, you understand. The amendment was agreed to. The Clerk read as follows: Sec. »■ (a) No person shall in the District of Cohmabla drink any beverage In any street, alley, or publicly owned space, or In any vehicle upon the same, or In or upon any depot, platform, or waiting nom of any public carrier, or In any hotel, restatirant. tavern, store, or place of business to which tbs public Is invited, or at any public gathering, except that bevsragas nukjr be drunk upon premises for which a reUiler's license class C has been Issued, and beer may be drunk upon prcmlsss for which a retailsr'r license class D has been issued. No person shaU be drunk or intoxicated In any of the plaeas (including vshldes) mentlonod in this section or at any public gathering and no penon shaU be drunk, or Intoxicated and disturb the peace of any person anywhere. (b) Any p>erson violating the provlstons of sbls section shaU he punished by a fine of not more than 9100 or by Imprisonment for not more than SO days, or by both sxich fins and Imprisonment lu the discretion of the court. (c) Section 11 of the act of Congress enUtled "An act to pre- vent the manufacture and sale of aloohoUc Uquors In the District of Colxunbla, and for other purposes ", approved March 3. 1W17. as amended by the act of Congress entitled "An act to provide reve- nue for the District of Columbia by the taxation of beverages, and tor other purposes ", approved AprU 6, 19S8, and section 20 of said act approved Much 8, 1017. are hereby repealed. Mr. O'CONNOR. Mr. Chairman, some time ago I sent to the desk an amendment. If the charming chairlady of the committee should feel tt is too late In the day to con- sider it. that is satisfactory to me. but the purpose of my amendment was to strike out the first part of section 28. I mentioned this matter before. Tbe provisioa as carried into this act was taken bodily from the ProhiUtion Act of the District of Columbia of 1917. This provision makes it a crime, punishable by a Jail sentence, if you take a drink in your own automobile; tt makes it a crime for you to take a drink in a raihxMUl station before taking a train. Those provisions were enacted when we had prohibition here in the District. The provision would even prohibit your taking a drink on a golf course or on your club grounds. In other words, you must go inside and hide yourself away in order to take a drink. I do not believe It is Intended, now that prohibition has been repealed, to make sneaks out of the American people. If I have liquor with me, whether I am ill or not. if I am waiting for a train in a railroad station and go into the men's room of the railroad station and take a drink of my own liquor, I can be arrested and sentenced to Jail under this provision. What I should do is to sneak into a restau- rant and take a drink by myself. Does not the Committee think that that provision has been unwisely injected into this bill? It is taken bodily, as the report shows, from the Prohibition Act of the EHstrict of Columbia of 1917, before we had national prohibition. I call for a vote on my amendment to eliminate such & provision from the biH. Mrs. NORTON. Mr. Chairman, while it is not my pur- pose to agree with the gentleman from New York in every particular. I really think his point is well taken, and I have no objection to accepting the amendment. The CHAIRMAN. The CTerk will report the amendment of the gentleman from New York [Mr. O'Connor]. The Clerk read as follows: Amendment offered by Mr. O'Cownob: Page, 89, line 23. strike out all of section 28, down to and Including the word " Issued ", In line 6, on page 40. The amendment was agreed to. The Clerk read as follows: Sac. 81. After the date of the approval oi this act no permit shall be issued under the act of Congress entitled "An act to pro- vide revenue for the District of Oolinnbia by the taxation of borsr- ages, and for other purposes", approved April S, 1088, and no permits issued there\UMler shaU be rmewed. but the Commis- sioners are hereby airtborized to extend the expiration dates of p>ermit8 Issued under said act to a date designated by them, not to exceed 00 days after the i4>firovml of the act. upon such terms aiul conditions. Including the paymctit of such fees as ths Oom- mlssloners may pisscrlbe. Any permittee thsreux¥tar may maks 294 CONGRESSIONAL an application for a license under this act, and. It said appllcatlCH] Is approved by the board, such permittee shall svurender his permit and he shall be allowed a refund of the permit fee pro- rated as hereinafter provided. Any permittee under said act ol April 5, 1933. may surrender his permit and receive a refund ol the permit fee prorated from the dat« of surrender of such p>erml1 to the date of expiration thereof. All such refunds shall be paid from the permanent Indefinite appropriation for refunding crro neously paid taxes In the District of Columbia. All permits Issued under said act of April 5, 1933. shall remain in force and effect fo! the respective periods for wlilch they were issued unless soonei surrendered. The said act approved April 5. 1933, shall stand repealed 1 yeai from the date of approval of this act. With the following committee amendments: Page 46, line 8. after the word " surrendered ", Insert " af tei the approval of this act no taxes shall be collected under sectioi^ 11 of the act approved April 5, 1933." The committee amendment was agreed to. The Clerk read as follows: Sec. 34. All laws which prohibit the sale of alcoholic beverage; i In certain defined sections or parts of the District of Columbin are hereby repealed. With the following committee amendments: On page 47. after line 15. insert: " S«c. 35. No holder of a retailer's license, except a retailer' i license class E. shall sell on credit any beverages except beer an< i light wines. This section shall not prohibit a club from extendini ; credit to its members or the guests of members or a hotel fron. extending credit to its registered guests. •■ Sec. 36. No rectified or blended spirits shall be sold unles i the container in which it is sold shall bear a legible label fiiml; ' afnxed thereto stating the nature and p>ercentage of each ingre dlent therein, the age of each such ingredient, and the alcohol!^ content of such spirits by volume," The committee amendments were agreed to. The Clerk read as follows: Sec. 35. If any provision of this act, or the application thereo ' to any person or circumstances, la held Invalid, the remainder of the act. and the application of such provisions to other personii or circumstances, shall not be affected thereby. With the following committee amendment: Page 48. line 3. strike out " 35 " and Insert " 37," The committee amendment was agreed to. Mr. KENNEY. Mr. Chairman. I ask unanimous consent tc return to i>age 40. line 8, for the purpo.se of offering a clari- fjring amendment to section 28. by striking out the wore " section " and inserting therefor the word " act." Th< preceding Isnguage has been stricken out and there are nd " places " referred to in the section, but there are in the act. Mrs. NORTON. There is no objection to that amendment , The Clerk read as follows: AmondoMnt offcrvd bjr Mr. Kmmmvt: Page 40, lln« 8, strike ou; the word ' Mction " aid Insert in ll«u thereof the word " act." Tlic amendment was agreed to. Mrs. NORTON. Mr. Chairman. I move that the Com mlttee do now rise and report the bill back to the House, with sundry amendments, with the recommendation tha the amendment be agreed to and that the bUl« as amended do pass. llie motion was agreed to. Accordingly the Committee rose; and the Speaker having resimied the chair, Mr. JoKXSOir of Oklahoma, Chairman o the Committee of the Whole House on the state of th i Union, reported that the committee, having had under con ' sideration the bill (H.R. 6181) to control the manufacture, transportation, possession, and sale of alcoholic beverages the District of Columbia, had directed him to report thi same back to the House with sundry amendments, with th recommendation that the amendments be agreed to an< that the bill as amended do pass. Mrs. NORTON. Mr. Speaker. I move the previous ques- tion on the bill and all amendments thereto to final passage . The previous question was ordered. The SPEAKER. Is a separate vote demanded on any amendment? If not, the Chair will put them in gross. "Hie amendments were agreed to. The bill was ordered to be engrossed, read a third time, and was read the third time. Mr. PATMAN. Mr. Speaker, I offer a motion to recommit. RECORD— HOUSE January 9 1(1 TTie SPEAKER. Is the gentleman from Texas opposed to the bill? Mr. PATMAN. I am. The SPEAKER. The Clerk will report the motion to recommit. The Clerk read as follows : Mr. Patman moves to recommit the bill to the Committee on the District of Columbia. The question was taken; and a division was demanded by Mr, P.\TM.\N. Mr, PATMAN (while the House was dividing). Mr. Speaker, I ask for the yeas and nays. The yeas and nays were refused. The motion to recommit was rejected. The SPEAKER. The question is on the passage of the bill. The question was taken and the bill was passed. On motion of Mrs. Norton, a motion to reconsider the vote by which the bill was pj_ssed was laid on the table. RESIGNATION FROM COMMITTEES The SPEAKER laid before the House the following communication : Washington. D.C, January 8, 1934. Hon. Henky T. Rainet, Speaker of the House of Representatives, Washington, D.C. My Dear Speaker Rainey : I liereby tender to you my resignation as a member of the following committees of the House, namely, Military Affairs. Elections No. 2, and Revision of the Laws. Respectfully, Thomas C. Cochraw. The resignations were accepted. ELECTION TO COMMITTEE ON WAYS AND MEANS Mr. SNELL. Mr. Speaker, I offer the following resolution. The Clerk read as follows: House Resolution 216 Resolved. That Thomas C. Cochran, of Penn.sylvanla, be, and he is hereby, elected a member of the Committee on Ways and Means. The resolution was agreed to. LEAVE or ABSENCE By imanimous consent, leave of absence was granted as follows : To Mr. MtTLDowwEY fat the request of Mr. Darrow), indefinitely, on account of illness. To Mr. Sweeney (at the request of Mr. Truax), indefi- nitely, on account of the serious illness of Mrs. Sweeney. DISPENSING WITH BUSINESS ON CALENDAR WEDNESDAY Mr. BYRNS. Mr. Speaker, tomorrow is Calendar Wednes- day, and I move that Calendar Wednesday biuiness be dispensed with. The motion was agreed to. COMMITTEE ON WAYS AND MBAMf Mr, DOUOHTON of North Carolina, Mr, Speaker, I ask unanimous consent that the Committee on Ways and Means may sit during the sessions of the House in considering the revenue bill. The SPEAKER. Is there objection to the request of the gentleman from North Carolina? There was no objection. OR DEE OP BUSINESS Mr. SNELL. Will the gentleman from Tennessee inform us what is to be taken up tomorrow? Mr. BYRNS. I think the Appropriations Committee will report the independent offices bill, and it is proposed to call it up tomorrow for consideration for general debate cnly, Mr. SNELL. I understand there will be nothing but general debate on the bill tomorrow? Mr. BYRNS. I so understand. It will not be printed and so will not be taken up under the 5-minute rule until Members have had a chance to examine it. ADJOtTRNMENT Mr. BYRNS. Mr. Speaker, I move that the House do now adjourn. The motion was agreed to; accordingly (at 5 o'clock and 15 minutes pjn.) the House adjourned until tomorrow, Wednesday, January 10. 1934. at 12 o'clock noon. 1934 CONGRESSIONAL RECORD— HOUSE EXECUTIVE COMMUNICATTONS. ETTC. Under clause 2 of rule XXIV, executive cranmunications were taken from the Speaker's table and referred as follows: 268. A communication from the President of the United States, transmitting supplemental estimates of appropria- Uons pertaining to the legislative esUbUshment. House of Representatives, for the fiscal years 1934 and 1935 in the sum of $4,000 (HJ30C. No. 213); to the Committee on Appropriations and ordered to b^ printed. 269. A letter from the Secretary of Agriculture, transmit- ting reports of the Department of Agriculture for the fiscal year 1933 on the subjects of Federal-aid road work, forest roads and trails, and sale of waste paper; to the Committee on Roads. 270. A letter from the chairman of the Advisory Com- mittee of Department of Commerce, transmitting the Seven- teenth Annual Report of the United States Shipping Board covering the period from July 1, 1932, to and including June 30. 1933 (HXtoc. No. 124) ; to the Committee on Mer- chant Marine. Radio, and Fisheries and ordered to be printed. 271. A letter from the chairman of the United States Employees' Compensation Commission, transmitting report of the operations of the United States Employees' Compensa- tion Commission for the fiscal year ending June 30, 1933 (HJDoc. No. 140) ; to the Committee on the Judiciary. 272. A letter from the chairman of the F^ederal Radio CommissiOTi. transmitting the annual report of the Federal Radio Commission for the fiscal year ended June 30. 1933; to the Committee on Merchant Mariiie, Radio, and Fisheries 273. A letter from the president of the Chesapeake k Potc. No 118) ; to the Committee on the Library. REPORTS OF COMMITTEES ON PUBLIC BlUiS AND RESOLUTIONS Under clause 3 of rule xni, Mr. HAINZS: Committee on the Poet OfBee uid Poet Roads. H.R. 4234. A blU to authorize the Poetmaeter Gen- eral to hire vehlelee from posUl employees; with amendment (Rept. No. 37ft). Referred to the Committee of the Whole House on the state of the Union. Mr, MCDUFFIE'. Committee on Insular Affairs. H.R. 6574. A bill to make Inapplicable In Puerto Rico and the Vlrfln Ishinds cerUln Federal laws relating to intoxicating liquors; without amendment (Rept. No. 276). Referred to the House Calendar. PUBLIC BILLS AND RESOLUTIONS Under eUuse 9 of rule XXn. public bills and resolutions were Introduced and severally referred as follows: By Mr, GRI8WOLD: A bill (H.R. 6603) to repeal the Oov- emment pay cut for the purpose of restoring purchasing power; to the Committee on Expenditures In the Executive Departments. By Mr. VINSON of Georgia: A bin (HJl, 6604) to estab- lish the composition of the United States Navy with respect to the categories of vessels limited by the treaties signed at Washington, February 6, 1922, and at London April 22, 1930, at the limits prescribed by those treaties; to authorize the construction of certain naval vessels; auid for other purposes; to the Committee on Naval Affairs. By Mr. SUMNERS of Texas: A biH (HJl. 6605) to amend a part of section 1 of the act of May 27, 1908. shapter 200. as amended (U.S.C., title 28. sec. 592) ; to the Committee on the Judiciary. Also, a bill (HJl. 6606) to amend the act providing for the annual conference of senior circuit judges; to the Com- mittee on the Judiciary. 295 Also, a bill (HJl. 6607) regulating proeedoxe in crimtoal cases in the courts of the United SUtes; to the Committee on the Judiciary. By Mr. EDMONDS: A bill (HJl. 6608) to amend Public. Law No. 2. Seventy-third Congress, entitled "An act to main- tain the credit of the United States Government ", and Pub- Uc Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commissions, and offices, for the fiscal year ending June 30, 1934, and for other purposes "; to the Committee on World War Veterans' Legis- lation. By Mr. McCLINTIC: A biH (HJl. 6609) to levy certain taxes on transactions In illegally produced crude petroleum- to the Cwnmittee on Ways and Means. By Mr. CHRISTLANSON: A Wll (H.R. 6610) providing for the taxation of inccnne derived from Interest upon the obM- gaiions of the United States, of the several SUtes and Tferri- tories, and of the municipal subdivisions thereof, of the District of Columbia, and of the possessions ot the United States: to the Committee . 1933. ISKAI.J Sam W. Mitchell. Secretary of State. By CLzrroRo L. Walker. Deputy. Bouse Joint Iffemorlal 4, a memorial to the President of the United States and Ck)ngress of the United States relating to the condition of agriculture within the United States Whereas a most critical condition exists In the United States, many fanners In this State are in grave danger of losing their homes; the condition of the agricultural interests of the United States are In so grave a condition as to amount to a «^»t/^n*i calamity; and Whereas the products raised by the farming population of the State of Montana and other States of the Northwest are only produced at a low by such farmers: and Whereas we believe that the condition can only be remedied by some action upon the part of the President of the United States and the Congress or the United States to the end that prices of agricultural commodities be fixed at a price at least equal to the cost of production and enough profit that those engaged in farming may live; and Whereas It appears that the various industries of the United States are being organized under codes to protect the rights Oif such Industries and the workers in the same: Now. therefore. be It Resolved by the House of Representatives of the State of Mori' tana {the senate ccmcvrHng) . That the Pmident of the United States and Congress take such steps as may be necessary to secure the adoption of a code for and by farmers which will permit the fixing of prices so as to relieve this very sertoxis con- dition; and that if same cannot be done without further legis- lation, that Congress shall pass such legislation as will enable the agricultural interests to combine under a code and Into an association or associations that the price of our agricultural products may be fixed for the welfare of the agricultural popu- lation and the entire Nation; and be It further Resolved. That the secretary of the State of Montana transmit a copy of this memorial to the President of the United SUtes and that he also transmit copies thereof to each Senator and Repre- sentative at Washington from the State of Montana. D. A. DCLLWO. Spesfcer of the House. R. Paulins, President pro tempore of the Senate. Approved December 22. 1933. P. H. CooNET. Governor. Mr. WHEELER also presented the following house Joint me- morial of the Legislature of the State of Montana, which wai referred to the Committee on Irrigation and Reclamation: Star or MoirtAMA. DEPAsntssrr Sbcretast or Stats, Helena, January 4. t$U. Hon. B. K. Wheeler, United States Senate. Washinffton. DC. Sir: In accordance with the mandate of the extraordinary s«h slon of Montana's Twenty-tliird Legislative Aiwembly, I have the honcH- to enclone a certified copy of House Jotot Memorial No. • and express the request that you render all assistance possible to the end that this matter be brought to the personal attention o( the President of the United States. Yours very truly, Sam W. Mitchell. Secretary of State. Unfted States or Amibica. State of Montana, $»: I, Sam W. Mitchell, secretary of state of the State of MonUna, do hereby certify that the following ts a true and correct copy of an act entitled " House Joint Memorial No. 6 ", a memorial to the President of the United States at America requesting an Investiga- tion of water control of the Yellowstone River in Yellowstone Park, enacted by the extraordinary twenty-third session of the Legisla- tive Assembly of the State of Montana, and api»x>ved by P. H. Cooney, Governor of said State, on the 4th day of January 1984. In testimony whereof I have hereunto set my hand and aflixed the great seal of said State. Done at the city of Helena, the capital of said State, this 4th day of January, A.D. 1934. [8«ALJ Sam W. MrrcHELL. Secretary of State. Hoiise Joint Memorial 5, a memorial to the President of the United State of America requesting an investigation of water control at the Yellowstone River In Yellowstone Park To the honorable President or the Unttbd Statib or America: Whereas during parts of the months (rf June and July of each year the flow of water In the YeUowstone River is greatly aug- mented by the melting of snow, causing serious damage to farms bordering on said river by the washing away of the banks and en- croaching on valuable tillable land, the menacing and destruction of irrigation headgates. bridges, and other structures along the course of said Yellowstone River, and adding to the excessive flow of the Missouri and Mississippi Rivers during the high- water stage of same; and Whereas if the flow during the period mentioned could be par- tially impounded and allowed to escape at a later period, it would very largely prevent the damage as before related; and Whereas if the waters of Yellowstone Lake were held at a fairly constant level and allowed to flow at the period when the flow of the river is lowest, namely, during the later days of July and aU of August, it would add greatly to the beauty ii the falls, and would make the lake more attractive by ke^^ng mud baaks cov- ered with water; and Whereas we, your memorialists, believe that an Investigation by competent engineers will corroborate our belief and show that such works are feasible and can be constructed at modsrate ooet: Now, therefore, be it Resolved by the hotise of rtpretentatioee (the eenate ooneur- ring) , That the President of the United States be. and taeraby Is, respectfully lurged to oonsldsr the lacts set fbrth herein, that same be investl^ted jMromptty. and that such acUea be taken as you may deem wlss and proper: be It fitrtbar Reeolved, That the seoetary of state of M-^t^ie transmit a copy ol said memorial to tlie Resident e< tke United SUtes, and 300 CONGRESSIONA RECORD— SENATE January 10 1934 CONGRESSIONAL RECORDS-SENATE 801 that h« also tmntmlt ooplM thereof to eacb Senator and Repi •- •antatlTe at Waahlngton, DC. from the State of Idontana. wi tb a request that they ooopcrkte In seeing that thla matter be brou{ bt to tha parional attention of the PreeUlent of the United States D. A. DsLLWO, Speaker of the House R. Pauunb. Prettdent pro tempore o/ the Senate Approved January 4. 1034. F. H. Coomr. Oovemor Mr. WHEELER alao presented the following lenate Joint memorUl of the Legislature of the State of Montana. whi(;h was referred to the Committee on Mines and Mining: Stats of UowtAmA, OSFASTMSMT StCBSTASY OT STATS, Heteiu, Deeember iS, t033 Hon. ItmTott K, WMmrtas, VnHe4 itatee Senate, Waehinfton, DO. •ts: In setiordaniNi with tha msndate of Ihs Mtraordlniry iSMintinf Montana's Twenty-third UfUlaUvt AsMsmbty, I hsvt tbs honor to »n«los« • oartiAed oopy e( iinals Joint Memorial Mori Tours very trttly. ■am W, MfTCHIf.!., Semetary 0/ State Uwrm iTATM 09 Amisioa, state of Montana, ««.' I, Sam W, Mitchell, seeretary of stats of the Stato of Montsiia. do hereby oorttfy that the following ts a true snd eorrect ccpy of an set entttied " Sonata Joint Memorial No. 1 ", a memorlAl to the Prestdsnt snd to the CongroMi of the United Ststes, reque it- ing the establishing of an asasy offlce at some appropriate po nt In the Stata of Montana, enacted by the extraordinary twen y- thlrd sesafon of the Legislative Assembly of the State of Mon- tana snd approved by F. H. Ckxiney. Governor of said State, on the asd day of December 1933. In testimony whereof. I have hereunto set my hand and aAaed the great seal of said State. Done at the city of Helena, the capital of said State, this a 3d day of December, AJ). 1933. Sam W. Mitchsix, Secretary 0/ State. By CurroKO L. Walkxb, Deputy Senate Joint Memorial 1. to the President and to the Congrdss of the United States, requesting the establishing of an assEiy offlce at some appropriate point In the State of Montana To the President and the honorable Senate and House of Repre- tentatives of the United States in Congress assembled: We. the members of the Twenty-third Legislative Assembly of the State of Montana, do hereby respectfully represent that: Whereas Montana has been one of the large gold-producl: ig States and the decline In the marketing of gold which result kI in the removal of the old assay offlce In Montana was geneial throughout the United States because at Interest for many years being centered In the mining of other metals and the mining of gold was not generally profitable, and Whereas since the beginning of the present economic crls is. and especially since the release of tbe embargo upon the markc t- Ing of gold, the mining of that metal has become more profltatle and Is now of especial Importance as an occupation for thoxisanls of unemployed, during the past seasons, and more partlculaily at the present time, hundreds of men and boys, and even women. have engaged and are now engaged In placer mining with a shot el and pan or with other crude methods handed down from t le early placer miners and have thereby been able to take frcm the soli free gold in quantities ranging from a few cents in val le up to substantial amounts, these people have been able to kep partially or entirely out of the bread line, and it is ip keeping with the spirit of the National Recovery Act to afford to them every opportunity to gain an Independent llv^inood in this ma 1- ner, and Whereas In marketing their product through the avenues new open to them theae miners are deprived of a great deal of t:ie benefit of their industry in that there are weeks of delay in o >- talning settlement for their product. Forms which baffle even a lawyer mvist be filled out and are ttsually returned two or thr>e times for correction, or the miner must find some other method of marketing his product which also deprives him of the fxil benefit of the Oovemment price, and Whereas under the existing regtUatlons which limit the pur- chase by the Oovemment to 2 ounces of fine gold in one shi >- ment. a man producing lees than that amount must comblj le with others or wait f }ected to the charges of intermediary pu - ebaaars or sales agents amounting to around 10 percent as a rule: Now, therefore, be it Reeolved by the Senate of the State of Montana (and by the house of representatives concurred) That appropriate action ba taken by Congress, if necessary, and by the President if he Is now authorized to do so by law, for the establishment at some approprls;,e point in Montana most convenient to the gold-pro< duclng territory, sn assay offlce where gold In quantities from half an ounce up may be sold by producers to the Government at the full market price and settlement therefor made promptly as in the days when the United States assay offlce was maintained at the capital of the State: Be It further Resolved, That the secretary of stste of the State of Montana Is hereby directed tn forward to the President of the United States and to th«> Senators and Reprsnentatives in Congress from the Stats of Montana copies of this tnemorlal. R, PAm.iNS, President pro tempore of the Senate, O. A, DSI.LWO, Speaker of the House, Approvsd Dsesmbsr aa, ions. f. tl, OooNiv, Oov#fnof, Mr, WHEELER also prM*>nt9d thd following MinAtg Joint m«mori*l of the LeglNlature of ths State of Montana, which wa« referred to (he Committee on Banldng and Currency: ■tats or Montana, DSTASTMKMT BsCRrTARY Of StaTS, Helena, January 3, 1054, Hon. B, K. WHsstm, Senate Office Building, Washington. D.O. Sir: In accordance with the mandate of the extraordinary ses- sion of Montana's Twenty-thlrd Legislative Assembly, I have ths honor to enclose a certltied copy of Senate Joint Memorial No. 3, and express the request that you render all assistance possible to the end that the Civil Works program within the State of Mon- tana continue Its program of civil works In the national forest within the State of Montana during the present winter, and em- ploy as many men as is possible from the State of Montana In said work during said period. I remain. Yours very truly, Sam W. MrrcHELL, Secretary of State. UNrrED States ot America, State of Afontana, ss: I. Sam W. Mitchell, secretary of state of the State of Montana, do hereby certify that the following Is a true and correct copy of an act entitled " Senate Joint Memorial No. 3, a memorial to the President of the United States, the Secretary of Agriculture of the United States, and Chief Forester of the United States ", enacted by the extraordinary twenty-third session of the Legis- lative Assembly of the State of Montana, and approved by P. H. Cooney. Governor of said State, on the 1st day of January 1934. In testimony whereof I have hereunto set my hand and afBxed the great seal of said State. Done at the city of Helena, the capital of said State, this 3d day of January, AJ5. 1934. IssALj Sam W. MircHELt,, Secretary of State. By Clutord F. Walker, Deputy. Senate Joint Memorial 3. a memorial to the President of the United States, the Secretary of Agriculture of the United States and Chief Forester of the United States Wbereas It appears that the allocation of men to civil -works projects on national forests has so far been conttned by the Civil Works Administration at Washington to 25 men; and Wbereas we are Informed that It had been previously estimated that nearly 12.000 men would be employed In Montana, northern Idaho, eastern Washington, and western South Dakota, and that this order was made In the belief that by reason of the clvll-worka program in Montana work In the forests would not be necessary- and that ' Whereas after all men now receiving relief are employed, which will be employed under the civil -works program, there will re- main 4.000 men In the State of Montana unemployed who are now on relief and 30,000 men out of employment registered with the employment service and seeking emplo3mxent, and most of w%iom win requh-e employment or relief during the winter; that Whereas several thousand of these men would be employed on civil-works projects In national forests within the State of Montana If said work were not discontinued, and that it ts neces- sary In order to provide work, food, and clothing for men within the State of Montana that said work in the national forests be continued during the coming winter, and that plans of the Forest Service have already been completed so that these men might be immediately put to work In such Service: Now, therefore, be it Resotved by the Senate of the State of Montana {house of representatives concurring). That the President of the United States, the Secretary of Agriculture, and the Chief Forester of the United States are respectfully urged to revoke the order discon- tinuing said civil works on national forests within the State of Montana, and that said works continue as heretofore planned, and that during the coming winter there be emi^oyed in said projects within tha State of Montana as man* man from said Stata as oan be employed to carry out said projects planned; be It furthor Resolved, That the secretary of state of Montana transmit a copy of aOd memorial to the President of the United SUtes. to the SecreUry of Agriculture, and to tha Chief Foreatar of the United SUtes, and that he also tranamit copies thereof to «>ach Senator and Raprsaentatlvs from the Stata of Montana at Waah- Ington. D.C.. with a request that they render all asslstanos poa- slbte to the end that the civil-works program within the Stata of Montana oontlnue its program of civil works in the national forest within the Btata of Montana during the present winter and •mploy as many man as is possible from tbe SUU of Montana In said works d\iring said period. A. Pauuns, President pro tempore of the Senate. D, A. Dvi.Lwo, ^ . Speaker of the UouH. Approvsd January 1, 1M4, f, N, OoottSY, Oovsfftor, Mr. WMEELKM also prosentpd the following joint memo- rial of the LegiMlature of the utate of MtmUna, whliih wa« rtf erred to the Committtie on Banking itnd Currency: ilATH ur Mkntana, DSfASTMSNT iSOKSTASV Uf ^ATI, „ _ _ Uolena, January 4, 1934, Hon, B. K, WHaei.sR. t/nltfd States Senate Office Building, WaMhington, DX3. Sm: In Accordance with tne mandate of the extraordinary ws* slon of Montans's Twenty-third Legislative Assembly, I have ths honor to enclose a certified copy of Senate Joint MeraorUd No. 4 and express the request thut you render all assistance possible, to the end that this matter be brought to the personal attention of the President of the United States. Very truly yours. Sau W. MrrcHcix, Secretary of State. Ukttcd Stars or America, State of Montana, ss: I, Sam W. Mitchell, secretary of state of the State of Montana, do hereby certify that the following is a true and correct copy of an act entitled " Senate Joint Memorial No. 4, a memorial to the President of the United States relating to the administration of Federal farm loans ly the Federal land bank located at Spokane, Wash., and other agencies In relation to loans upon farms within the State of Montana ", enacted by the extraordinary twenty-third session of the Legislative Assembly of the State of Montana and approved by F. H. Cooney, Governor of said State, on the 1st day of January 1934. In testimony whereof I have hereunto set my hand and afflxed the great seal of said State. Done at the city of Helena, the capital of said State, tbls 3d day of January, AJ3. 1984. [sBAi.] Sam W. Mitchell. Secretary of State. Senate Joint Memorial 4, a memorial to the President of the United States relating to the administration of Federal farm loans by the Federal land bank located at Spokane, Wash., and other agencies in relation to loans upon farms virithln tbe State of Montana Whereas a most critical condition exists In the United States, and many farmers In this State are In grave danger of losing their homes; and Wbereas we appreciate all that the President of the United States Is doing In their behalf and we express our full faith and confidence In his aims and program to aid and relieve our farming population; and Whereas the Federal farm loans in the State of Montana have been made through the Federal land bank of Spokane, Wash.; and Whereas it appears that said Federal land bank Is unjustly dls- crlDQlnatlng against the farmers and ranchers of the State of Mon- tana in that said land bank has almost ceased to function as an active agency In the State of Montana and has encouraged farm- ers and ranchers in this State to make applications for loans and such applications have been made at great inconvenience and expense and large numbers of loans have been requested, the se- curity being adequate to warrant such loans, and that said appli- cations have been delayed for long periods of time and finally rejected without any good reason for such rejection; and Whereas said land bank has adopted a policy of requiring citi- zens of this State to include within the seciirlty given for their loans mortgages on livestock owned by such applicants and has required the execution of mortgages on real estate and chattel mortgages, where loans have been granted. In an arbitrary manner, so as to encTunber all liquid assets of borrowers and leave them helpless and unable to proceed in a reasonable manner to support themselves or families; and Whereas we believe that the regulations and requirements of said land bank as it functions in the State of Montana are whoUy unreasonable and discriminatory against tbe citizens of this State and tliat same are being administered harsbly and with no con- sideration to the welfare of this State or its citizens, and that by reason of the fact that the Federal land bank is located without the State and is not Interested In tbe welfare of the citizens of this State, and that the law authorizing these Federal farm loans as at present administered within tbe State of Montana to of no benefit to the citizens of this State: Now. ttierefore, be tt Maeolve by the SnsaU of the St9te 0/ MenlMa ttha houae 0/ repraeantattim oonourHag), That tlM Prssldeat of ths United SUtss ba. and harsbv Is. rsspsetfuUy uigod to oonsltfsr ths faots set forth herein, that same bs lavsstlgatsd pronumy. and that an agency bs ssUbUshad within ths BUto of liimtuia to ssrrs ths people of this State, and that the Psdaral lasd bank at Spokane bs required to modify tU rulss and ragulUtoas to permit such oonslderatlon as to within ths ptirposs and taftaat of tbs law and ths liberal polley advooated and approrsd tot ths Frssldsnt of ths United SUtes; and bs It further Bssolosd, That ths ssoretary of stats of Montana transmit a oopy of said msmorlal to ths Prssldsnt of ths United SUtss and that hs also transmit oopiss thsrsof to saoh Ssnator and ReprsesnUtivs at Wsshlngton from ths SUU of MonUna. wltH a rscniest that thsy ooopsrats in seeing that thto matter be brought to tbe personal stuutlon of ths rrssidsnt of ths United StaUs. R. rAtruira. frssidsfif pro Umpore 0/ the Senatt, D. A. DeLi.wo, _ . f peeUMf e/ the tiouts, Approved January t, 1M4. f, N, Oeoirif , Oovemm, Mr, WKnum slM prffMm(«d s )oint msmortal of fht LeglRlaturf of tht StaU of Montsns, favoring the pagaagg of leglalatlon for tht purchsM of Montana oattlg for distribu- tion to worktn on Federal projeota and for the relief of the destitute in the State of Montona. which wae referred to the Committee on Banking and Currency. (See Joint memorial printed in full when laid before the Setiate by the Vice President on the 4th Instant, p, 60, CONORESSZOIfAL RbCOKD.) Mr. WHEELER also presented a Joint manorial of the Legislature of the State of Montana, favm-ing the paasage of legislation prohibiting the producers and distributors of gasoline from establishing unfair and unjust prices for sale at retail to the people of the United States, and thus removing unjust discrimination, which was referred to the Committee on Interstate Commerce. (See Joint memorial printed in full when laid twfore the Senate by the Vice President on the 4th instant, p. 50. Congressional Record.) hgrth OHIO voLxnmss DrrainrKT, spaxish war Mr. BULKLEY. I present a brief and peUtion from offi- cers of the Eighth Ohio Volunteer Infantry, War with Spain, together with a supplementary statement of Oen. Charles W. Dick, of Akron. Ohk>, a former Senator fnnn Ohio. I have had the pleasure of presenting the original signed copies to the President of the United States. I abk that the matter presented by me may be printed at this point In the Record and appropriately referred. There being no objection, the brief and petition were re- ferred to the Committee on Pensions and ordered to be printed in the Record, as follows: BRIEP AKD PrrmON SUBMTrrCD rOK COI7Sn>EaATIOM BT THE PRESIDENT AND OONGBX3S, THE VSTBUMS' ADMIKISTKATIOK, AMD TSMSMM DIVI- SION THEBXOr We, the undersigned, who served as officers of the Eighth Ohio Volunteer Infantry, War with Spain, respectfully submit the fol- lowing statement to the pension division. Veterans' Administra- tion, and request its consideration in adjustment of the claims of veterans of our raiment: The Eight Ohio Volunteer Infantry was an old-established National Guard regiment which had maintained a high standard in personnel and efficiency through all the years. The regiment was mobilized at Akron, Ohio, April 25, 1898; or- dered to Camp Bushnell, Columbxis, Ohio, where tt was given rigid physical examination and mustered into United States service. After l>elng mustered, it was ordered to Camp Alger, Va. Camp Alger was badly located. There was lack of Water fit for drinking and cooking purposes. The camp was 10 miles from tha Potomac River and there was nothing between camp and the river ekcept the distance which we had to travel to take s bath. These conditions soon developed much sickness, typhoid fever, dysentery, and a long list of ailments, which nearly became epi- demic. After we left for Santiago, the camp was abandoned. Tbe ambulance, medicine chests, and medical Instraments Issued to us 1^ the State of Ohio were ordered turned over to head- quarters medical staff on our arrival at Camp Alger and their return was refused when we were ordered to Santiago de Cuba, so that our supply of medicine consisted of just what each doctor had in bis handcase. Our first requtoitlon for medicine tn Cuba was refused because It had not been approved by our brigade fommander, Oen. Oeorge A Oarrettson. who was In Puerto Rico, and our regiment had at that time 800 sick men on our morning reports. Our surgeons, three of them, were active practitioners of ez- eeUent standing and long service, but wben confrcmtcd with tropical diseases ooneemlng which thsy knew IttMo ney eould JUI9 rONGRESSIONAL RECORD— SENATE January 10 302 CONGRESSIONAL RECORD— SENATE January 10 ii f Kodtr Miun relief: In f»ct. th«y wtre thtrwelvef Mon pbyilMlly unablt to do anything. All thi** have been dead many yeire; the aenlor euifeon. Dr. F. C. Farquhar, died very aoon after re- turning to hie home at Zaneevllle. Our equipment wa« wholly unnuited for tropical aervloe and t'aa a aenoue handicap to all. both wpU and alck. Our ration* were no bad they created a national acandal. we were ordered not to eat native frulta, We were laaued meat twice. and both timea li waa ordered burled by the aurgeona. It wa* Impoaaible to get anything that waa fit for a alck man to eatjat a time when two thirds of that Army wa* on Its back and ^he remaining third were phyalcally unable to administer to them. Nothing herein stated la Intended as crlttclam. The campaign waa an emergency which had to be met and which we encoi n- tered wholly unprepared but, above all, let It be remember (d. through no fault of the men who were sent into that service. Now. we who went through that campaign and are now wltneia- ing the fearful death rate of our comrades feel keenly regarding the welfare of these comrades remulning among us. We kn}w their service Is responsible for their present condition, whch ranges between total dlaablUty and far below normal. Such se v- Ice could not help but leave Its permanent mark upon thplr physical constitution. We believe the present condition of thise men and the aacrlflces they made, and are still making, shoiUd materially temper any fxirther demands upon them. We have reason to believe beyond doubt that other organliia- tlons which served with us in the Santiago campaign are toaay In similar condition, due mainly to our having to undertake tro )i- cal service before the Nation was prepared to provide olherwlsi — a provision the essential character of which our service and its costs in lives and health so fearfully demonstrated. The lessons our Government learned from our costly experlei.ce In Cuba can never be compensated for In money, however gen- erously such compensation may Justly be made to Anally previill. Our appeal Is in behalf of those with whom we served, men whom we know and have known approximately for half a centuy; men as brave, patriotic, and loyal as ever marched to war. We sadly survey their present condition and contemplate their future with great concern and deepest sympathy. For them and their comrades we seek Justice, humane consldei a- tlon, and fair treatment for the sacrlUces they have made, and or the penalties, the physical and material consequences from Ihe day they were mustered out to the present. Charles W. Dick, lieutenant colonel:: Marquis A. Charltdn, captain: H. O. Peederle. captain: Tully O. Delbler, captain: Kiser W. Taylor, first lieutenant; Frank C. Gerlach, captain; William E. Barnard, first lieutenant; Dudley J. Hard, first lieutenant: Orlando R. Edwar Is, second lieutenant; Edgar E. Broslus, first lieutenant; George Reer. second lieutenant; William M. Burson. fi/st lieutenant: Andrew T. Weybrecht, second lieutenant; Anunon B. Critchfleld. captain; Joseph W. Young, seco id lieutenant; Charles H. Hughes, first lieutenant; Gustave W. Unger, second lieutenant; James O. Campbell, ciiap- lain; Charles F. Schaber. second lieutenant; Herbert S. Spidel. ftrpt lieutenant: Elliott L. Gyger. captain: Join W. Blrk. first lieutenant; Geo. O. Anderson, first lieu- tenant; C. S. Hoover, second lieutenant; Wilbert A. Hobbs, surgeon; W. O. Rutherford, second lieutenant; being the remaining living offlcers of the regiment when mustered Into the United States service for the Cuban campaign now available. SUPPLXMJENT&L STATEMENT Attached hereto la tlie statement of living ottcers of the Elgl;th Ohio Volunteer Infantry. War with Spain, whose signatures nre now available. The following declarations offer added facts beur- ing on the situation disclosed in the brief above referred to, few of which. If any, are likely to have been Included in official reports. In addition to the officers commanding the various groups ure the signatures of the chaplain. Rev. James O. Campbell, and Ihe one living stirgeon. Dr. W. A. Hobt>a. It seems reasonable to 'e- psat the obvious truth that my acquaintance with all these nfen who have signed the brief covers a period of more than 35 prior to aiKl following the time when we were comrades Ln same regiment rendering service to our country during the with Spain. Although I did not witness the signing of the docxunent each and all of these officers I feel fully qualified to verify tbfelr algnatvuvs. IndlTldually and collectively, as being genuine, made without undue influence, and free from mental reservation. Furthermore, there has not come to my attention one wcrd of criticism respecting the statements therein made. No quallfi( a- tion has been urged except in one instance where It waa suggesl ed that certain matters might be more strongly emphasised. Again, having known these men through a period of many ye irs In time of war and in peace. I know of no single act that would in any degree disqualify any one of them in making any sta e- ment. although made in their own behalf. All of them are men of Integrity, honesty, and reputation of such character as woi id place each and all beyond challenge. In other words, the statement, to my mind and to my way of thinking, is as valid and binding as if an oath sustaining the brief to which they have attached their signatures had been administered to each and every one and should be so received a iid accepted. Because of peculiar personal exjierle:ices bearing on the br ef submitted and to which my own signature is written, I subs tit yeLrs Ihe I ar by additional pereonal teetlmony to which I give my ilgnature and further substantiation by oath, administered by one duly author' Ized to execute the name. When the Eighth Ohio Volunteer Infantry was ordered to Camp Alger I waa sent to ^ails Church, Vs.. In sdvnnfu to aolect ground on which the regiment was to pitch Its cnmp. Ours was the first regiment to occupy any i)art of that areu nubs^riiiently known as '• Oawip Alger," I then mofle pi'. test to the omccr In charge, Major Urnl, concernlnij the wafer rmpply. Up to the time that our regiment left for Cuba nothing worth while had been done to better thot sltuatlbn. Many of our men wore 111 before we left Camp Alger.' larpely dtje to the poor and Inndequate water stipply. When the regiment left for Cuba under emergency orders our equipment was faulty In every rt.spect. Wc reached Cuba during the rainy season at a time of year which Is mo<«t dangerous even to natives and people acclimated to tropical conditions. Berlous sickness began to Increase shortly after our landing at Slboncy. Rain fell In torrents every day. Intense heat ranging above 100° F. was onother dally exprrlence. Impenetrable rofd States. We were with- out proper medicines or medical and surgical equipment of ony sort. Our rations were of un-»ati8factory and unsanitary quality. We were without hospital supplies or requlremtnts and none were obtainable until days after the surrender at Santiago dc Cuba. Conferences had with many omoers, Including Generals Henry, Bates, Kent, Miles, and Colonel Wood, Spanish omcers. Cuban offi- cers, a priest at the cathedral who was a former resident of Toledo, Ohio, and others, brought out the extent of most alarming condi- tions threatening our soldiers who were wholly unaccUmutcd and unprepared . Dealing next with an experience of our regiment, following an order Issued by the War Department and transmitted to us by General Shafter. tlie organization was Isolated for a period of 10 days, after which the regiment should be sent to F*uerto Rico where, so the Department order stated, it was needed. This had been requested by General Miles. These orders were strictly fol- lowed, the regiment was duly lt>o!ated. the most rigid Instructions were obediently followed, to the end that we might participate in the Puerto Rican campaisn. After 10 days General Shafter sent an Army surgeon to make the required inspection. The verbal report made to me by the Bur- geon as he finished his task was to the effect that more than 300 men of the regiment were ill with yellow fever. These conditions not only with respect to our regiment but equally with the entire Army, so report* showed, grew constantly worse until it was roughly estimated that two thirds of that Army was on its back and the other third were scarcely able to take care of them. General Henry said to me as he was leaving for Puerto Rico. " Dick, history will prove to you, now reinforced by your experi- ence, that the Province of Santiago at this season of the year has ever been the ' pest hole ' of all creation." When I reported to General Shafter's headquarters in Santiago de Cuba at his request, I met Col. Theodore Roosevelt by chance as he was leaving the meeting of general offlcers who had been considering the situation and had cabled a strong petition to the War Department. He said to me that I had been unanimously chosen by the offlcers attending that meeting to proctjed at once to Washington and report in person to the President and the Secre- tary of War the direful situation of the Army at Santiago de Cuba and the urgent importance of its withdrawal because of the pre- vailing sickness aixiong the men. He had been urged to perform that mission, but he told me he said to the a.ssembled offlcers there was a man In that Army whom the administration at Washington would beUeve and that was Dick, of the Kghth Ohio, and he urged and recommended my selection. I then protested to Roosevelt and Shafter that I preferred to remain In Cuba with my regiment, but they Insisted I could do more to help by going. I finally said to General Shafter I was ready to obey ordera. and it was so ordered. Just Inside the hallway of Army headquarters I talked with General Wheeler, who. in discussing the situation, pronounced it " hellish." I found General Shafter greatly distressed by the alarming conditions. He ordered me to report early next morning prepared to go from Santiago to New Orleans on the steamer Berlin with a bale of papers, maps, and other information for the War Department and the President. On parting vsrith him to take ship the next morning General Shafter said to me : " You may say to the President for me that if neceiisary we can stay here and die, but the war on the Island is over and the early return of these men to the States wUJ save not hundreds but thousands of human lives In this Army." On leaving the palace, which was occupied by General "SEafter and his staff as Army headquarters. I crossed the plaza to get a glimpse of the interior of the ancient cathedral directly opposite the palace. While locking at the frescoes I felt a hand resting on my shoulder, and. turning. I found myself face to face with a priest. In well-spoken English he asked me If I was an officer of the Army, and I answered affirmatively. He asked my name, rank, and regiment. When I told him. I was amazed to have him speak familiarly of Ohio affairs, when he. noting my surprise, told me he had once served a parish In Toledo. Almost Instantly upon my identification he said: "Colonel, if you have Influence with the administration at Washington, get this Army out of here at the earliest moment pnisslble, for if they remain here much longer under existing climatic conditions without proper shelter and sup- 1984 CONGRESSIONAL RECORD— SENATE «11M. thtj will dlt Ilk* fllM." Ttits prlMt WM • oompatcnt witnMi. fh»n th*t Armr *VMiMt«ii. dent MoXinley and Beeretary of War Alter, the Prealdent directed the SecreUry to iMue order* for tbe limnediate return of the Army at SAntiafO de Cuba and for replacementa by immune*. The Prealdent In oommentlng— the Secretary of War agreeing— freely stated they had no prerlous conception of the serious con- dltloas obtAlnlng in the Army in Cuba until they heard my verbal report and had examined the maps and popers I had brought for their mors comprehensive information. No man who has not gone through these same experiences can fully understand what havoc and dlstreaa that campaign, under clrcumstanoea above described, has wrovight to these unfortunate ▼efeeraas with consequences in later life that are, of course, not ■usceptible to acctirate measure. I offer theee Incidents as proof of what the leaders In that campaign thought of the gravity and seriousness of the situation at that time. In view of the statements made In the brief submitted by the officers of the regiment and these which I have personally added, and the difflculty In sec\u-lng and submitting satisfactory support- ing evidence as proof in the estobllshment of disability due to service origin, we appeal for broad and liberal construction of the laws. rxUes. and regrilatlons dealing with pensions not only of the men of our regiment but of all soldiers participating in that campaign. Another difflculty to which we invite your attention is the fact that approximately half the men of our regiment are dead. An- other considerable percentage are scattered in all parts of the country. But even where they are grouped together it Is ex- tremely difficult to recall important occurrences S5 years after they occurred, hence the impossibility in securing satisfactory evidence supporting or proving disabilities to be due to service origin. A brief quotation from the record shows that the Eighth Ohio Volunteer Infantry was wganlzed AprU 26. 1898. at Akron, moved to Columbus April 28. Mustered in United States service May 13. Moved to New York June 8 and embarked for Cuba. Landed at Slboney. Cuba. July 11. Encamped on Sevllla Hill July 16. Camped on San Juan Hill August 11. Embarked for Montauk Point. N.T., August 17. Arrived at their homes in Ohio September 8. Purloughed until November 10. Mustered out November 21, 1898 Actual days of service were 133. Total sick In general hoe- pltal. 650 out of 1.200 men. Deaths, 72. The death rate per 1.000 per year in the United States for all ages for the year 1898 was 16.2 persons; the death rate per 1,000 per year for the Eighth Ohio Volunteer Infantry for ages 18 to 25 for the year 1808 was 164.2 persons, or 10 times the normal death rate. We therefore feel fully Justifled in appealing to officials who deal with these matters to grant broadest consideration to our comrades who are still with us, and for their dependents. Llke- wiae for the widows and children whom our dead comrades be- lieved were secure from poverty by generous treatment at the hands of the Government they served and for which they offered their lives in time of war. All this was promised them when they enlisted for the war. The pension px^icy of the United States tor a century and a half was of Itself an implied If not unequivocal guarantee of such security. A just government cannot now, a third of a century later, repudiate such obligations with honor. Respectfully submitted. Cwaai.cs Dick. Statc or Ohio, Summit County. »$: Sworn to before me and subscribed In my presence on this 4th day of October, A.D. 1933, by the above-named affiant. I hereby certify that I have read this affidavit to the affiant before he executed same and that said afOant is personally known to me to be a reputable person. Witness my hand and the official seal of my office this 4th day of October. AJJ. 1933. My commission expires May 22, 1934. Jas. a. Coret. Notary Public. Summit County, Ohio, 130 West Thornton Street. Akron. Ohio. MXVORIALS OF laCHIGAN KUNICIPAL LKAGUK Mr. VANDENBERG. Mr. President, recently the repre- sentatives of 100 Michigan municipalities met at the State capital and adopted 4 memorials addressed to Congress, which I submit and ask that they be printed in the Record and appropriately referred. There being no objection, the memorials in the form of resolutions were ordered to be printed in the Record and referred to committees, as follows: To the Committee on Banking and Currency: UtTNICIPAL SHORT-TERM CREDIT Whereas there is no market through normal financial channels for sbort-term notes and warrants even for cities and villages in sound financial condition; and Whereas this lack of credit cripyples and in many instances re- sults in the abolition of municipal services, throwing men out of work at a time when the Federal Government Is Increasing employ- ment: and 808 th« ettlM and TtUacM ot iitebHaa and vthar fOTtm- msntal units bars sound mmCs in ths form of dallnquant tasM which can be pledged as ssourtty: Therefor* brtt JleiotMd. That th* Mlehlfaa Mtmlelpal L*agu* rKioaat th* President to create a municipal credit eorporatlon from which municlpalitieB can borrow on raMonabl* aacurlty. Passed unanimously January f, 1034. Submitted by the IHchlfaa Municipal LMgu*. Aaa Arbor, Mleh. To the Committee on the Judiciary: UrUWDUfO MUmCVAL Whereas there are many dtl** and viUacM and otlMr goram- nMntal imlts in Michigan in default on their bond*d debt: and Wh*r«a* there is no existing legislation which wlU permit ihu- nletpal governments to bring about aa ad>iatmeBt of their debU with their creditors except with the unanimous consent thereoT: and Whereas It U our belief that both cities and creditors wfll con- tinue to suffer hardship unless some definite legal miinner is pro- ▼Ided for the adjustment of municipal debU: Therefore be It Re$olved. That the Michigan Municipal League, oorapoeed of cities aikl villages in the SUte of Michigan, favor the enactment of the Summers-Wilcox bill now before Congress, which wlU permit cities through the Federal eourU. with the consent of their cred- itors, to readjust their debts «x the basis of their ability to pay. Passed unanimously January S. 1934. Submitted by the Michigan Municipal League, Ann Arbor. Mich. To the Committee on Finance: FEDERAL AID FOR PX7BLXC WORKS Whereas we brieve sound public works to be a moet important part of the national-recovery program; and Whereas Michigan, hampered by statutory and constltutloiud restrictions, has been unable to take advanta^ of Inderal aid for public works: and Whereas only approximately half of the aN>Ueatloos presented to the State advisory board on public works have been forwarded to Washington; and Whereas It appears that the public-works fund la nearly ex- hausted, a major part oi which has been allotted to Federal projects: Therefore be It Resolved, That the Michigan Municipal League request the President and the Congress to appropriate additional funds to non-Federal public works. Jtetolved further, That a copy of this resolution be presented to the President and to Michigan's Representatives In Congress. Passed unanimously January S. 1934. Siibmltted by the Michigan Mualcltwl League. Ann Arbor. Mich. [SEAL] ClVn. WOaXB AOUXKISTRATKMr Whereas the C.WJk... throiigh decentralized administration, has promptly given employment to many who were recipients of public relief and to others destitute but not yet on relief; and Whereas business has been thus stimulated by the distribution of purchasing f>ower, resulting in a more hopeful and optimistic attitude generally; and Whereas the brief exp>erlenoe thus far with dvU works has proved it to be an effective agent for national recovery and at the same time creating many needed and useful works which would other- wise have been neglected; and Whereas the present allotment of men to Michigan is approxi- mately one fifth of the registered unemployed: Therefore be it Resolved. That the Michigan Municipal League request Congress not only to continue the present C.W.A. program but to materially expand it as a supplement to relief and public-works approprlatlona. Carried unanimously, January 3, 1934. Submitted by the Michigan Municipal League. Ann Arbor. Mich. [SEAL] REPORTS OF THE COKXTTTEE ON CLAIMS Mr. LOPAN, from the Committee on Claims, to which were referred the following bills, reported them each without amendment and submitted reports thereon: S. 163. A bill for the relief of Capt. Ouy M. Kinman (Rept. No. 150); S. 172. A biU for the relief of the First Camden Matiooal Bank b Trust Co., of Camden, NJ. (Rept. No. 152) : and S. 1651. A bill for the relief of the estate of Anton W. Fischer (Rept. No. 151). Mr. LOGAN, also from the same committee, to which was referred the bUl (S. 1683) for the relief of the Standard X>redging Co.. reported it with an amendment and submitted a report (No. 159) thereon. Mr. BAILEY, from the Committee on Claims, to which were referred the following bills, reported them each without amendment and submitted reports thereon: 8. 2. A bill for the relief of C. M. Williamaon: Mrs. Tura Liljenquist, administratrix of C. E. Liljenquist. deceased." Lottie Redman; and H. N. Smith (Rept. No. 170) ; 304 CONGRESSIONAL RECORD— SENATE A bin for the relief of Warren J. Clear (Rept. IFo. January 10 1934 CONGRESSIONAL RECORD— SENATE 305 h ■^- ,JE I 4 V 8.406 157) ; S. 749. A bill for the relief of the Fairmont Creamery C o., of Omaha. Ncbr. (Rept. No. 176) ; S. 750. A bill for the relief of the Lebanon Equity E x- change. of Lebanon, Nebr. (Rept. No. 162) ; S. 751. A bill authorizing the Secretary of the Treasury of the United States to refund to the Farmers* Grain Co.. of Omaha. Nebr.. income taxes illegally paid to the United States Treasurer (Rept. No. 166) ; S. 1069. A bill authorizing adjustment of the claim of t le Chicago. North Shore & Milwaukee Railroad Co. (Rept. Ifo. 153); S. 1074. A bill authorizing adjustment of the claims of John T. Lennon and George T. Flora (Rept. No. 151) ; S. 1073. A bill authorizing adjustment of the claim of t le Franklin Surety Co. (Rept. No. 168) ; S. 1079. A bill authorizing adjustment of the claim of Francis B. Kennedy (Rept. No. 163); S. 1082. A bill authorizing adjustment of the claim of t le Penn.sylvania Railroad Co. (Rept. No. 173 >; S. 1033. A bill authorizing adjustment of the claim of tie Potomac Electric Power Co.. of Washington, D.C. (Rept. I o. 174); S. 1084. A bill authorizing adjustment of the claim of t le Public Service Coordinated Transport of Newark, N.J. (Re )t. No. 171); S. 1087. A bill authorizing adjustment of the claim of W 1- liam T. StUes (Rept. No. 175); S. 1115. A bill to authorize the Department of Agriculttre to issue a duplicate check in favor of Department of Fore^ ts and Waters, Commonwealth of Peimsylvania, the origlral check having been lost (Rept. No. 160) ; S. 1192. A bill for the relief of the Union Shipping a; id Trading Co., Ltd. (Rept. No. 172); S. 1219. A bill to carry into effect the finding of the Coirt of Claims in the claim of Elizabeth B. Eddy (Rept. No. 167 ) ; S. 1426. A bill for the relief of the estate of Benjam n Braznell (Rept. No. 155 »; S. 1504. A bill for the relief of Walter J. Bryson PaviJig Co. (Rept. No. 154) ; and S. 1782. A bill for the relief of the B. & O. Manufacturing Co. (Rept. No. 156). Mr. BAILEY also, from the Committee on Claims, to whii ;h were referred the following bills, reported them each wi ,h an amendment and submitted reports thereon: S. 256. A bill for the relief of Milburn Knapp (Rept. !■ o. 164) ; and S. 407. A bill for the reUef of WUlie B. Cleverly (Rei)t. No. 158). Mr. BAILEY also, from the Committee on Claims, to whi;h was referred the bill (S. 376) for the relief of Beatrice I. Manges, reported it with amendments and submitted a report (No. 159) thereon. Mr. COOLIDGE, from the Committee on Claims, to whl :h was referred the bill (S. 1680 > for the relief of the estate of George B. Spearin. deceased, reported it without amen 1- ment and submitted a report (No. 165) thereon. BILLS AND JOINT RESOLXTTIONS INTRODT7CED Bills and joint resolutions were introduced, read the fiist time, and. by unanimous consent, the second time, and le- f erred as follows: By Mr. COPELAND: A bill (S. 2116) to amend section 2 of the act of February 13, 1893; to the Committee on Commerce. By Mr. KING: A bill (S. 2117) authorizing the Reconstruction Finance Corporation to accept State bonds at par as adequate sect r- Ity for loans in certain cases; to the Committee on Bank! ig and Currmcy. A bill (8. 2118) relating to proceedings in adoption in t le District of Columbia; to the Committee on the District Cohunbia. of By Mr. GEORGE: A bill (S. 2119) to provide for the further development of vocational education in the several States and Territories; to the Committee on Agriculture and Forestry. A bill (S. 2120) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78, Seventy- third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bu- reaus, boards, commissions, and ofiBces, for the fiscal year ending June 30, 1934, and for other purposes "; and (By request.) A bill (S. 2121 » to amend an act entitled "An act to maintain the credit of the United States Govern- ment ". approved on March 20. 1933, and for other pur- poses; to the Committee on Finance. By Mr. CONN ALLY: A bill (S. 2122) to provide for loans to farmers for crop production and harvesting during the year 1034, and for other purposes; to the Committee on Agriculture and For- estry. By Mr. THOMAS of Oklahoma: A bill (S. 2123) for the relief of Bruce F. Ramsey; to the Committee on Military Affairs. A bill (S. 2124) for the relief of A. D. Ellis (with accom- panying papers) ; to the Committee on Naval Affairs. By Mr. FLETCHER: A bill (S. 2125) to continue the functions of the Recon- struction Finance Corporation, to provide additional funds for the Corporation, and for other purposes; to the Com- mittee on Banking and Currency. By Mr. TRAMT.IELL: A bill (S. 2126) granting a pension to May Barnes; and A bill (S. 2127) granting a pension to Prank T. Douglas; to the Committee en Pensions. By Mr. JOHNSON: A bill (S. 2128) to authorize the Reconstruction Finance Corporation to make loans for financing the repair and re- construction of property damaged by unusual floods in the States of California, Oregon, and Washington; to the Com- mittee on Banking and Currency. A bill (S. 2129) to provide for the appointment of two ad- ditional judges of the District Court of the United States for the Southern District of California, and for other pur- poses; to the Committee on the Judiciary. By Mr. CAREY: A bill (S. 2130) to authorize an appropriation for the purchase of land in Wyoming for use as rifle ranges for the Army of the United States; to the Committee on Military Affairs. By Mr. CAREY, Mr. CUTTING, and Mr. ADAMS: A bill (S. 2131) to establish a Federal land-bank district for the States of Wyoming, Colorado, and New Mexico, and for other purposes; to the Committee on Banking and Cur- rency. By Mr. HEBERT: A bill (S. 2132) for the relief of Preston B. Mavor; to the Committee on Commerce. By Mr. CAPPER: A bill (S. 2133) to amend the Packers and Stockyards Act, 1921 ; to the Committee on Agriculture and Forestry. By lAi. SHEPPARD: A bill (S. 2134) for the reinstatement of John Carmlchael Williams in the United States Navy; to the Committee on Naval Affairs. By Mr. HAYDEN: A bill (S. 2135) to amend the act of Congress approved June 7, 1924 (43 Stat.L. 475, 476), commonly called "The San Carlos Act ". and acts supplementary thereto, and for other purposes; to the Committee on Indian Affairs. By Mr. FRAZEER (by request) : A biD (S. 2136) authorizing an appropriation for payment to the Uintah. White River, and Uncompahgre Bands of Ute Indians in the State of Utah for certain coal lands, and for other purposes; and A bill (S. 2137) authorizing the TUngit and Haida Indians of Alaska to bring suit in the United States Court of Claims, and conferring jurisdiction upon said court to hear, examine, adjudicate, and enter judgment upon any and all claims which said Indians may have, or claim to have, against the United States, and for other purposes; to the Committee on Indian Affairs. By Mr. REED: A bill (S. 2138) for the relief of (Charles J. Webb Sons Co., Inc.; to the Committee on Claims. By Mr. BAILEY: A bill (S. 2139) for the relief of the Western Union Tele- graph Co.; to the Committee on Claims. A bill (S. 2140) to provide warrant officers of the Coast Guard parity of promotion with warrant officers of the Navy: to the Committee on Commerce. By Mr. NEELY: A bill (S. 2141) for the relief of Roy Lee Groseclose; and A bill (S. 2142) for the relief of Mrs. Charles L. Reed; to the Committee on Claims. A bill (S. 2143) for the relief of Francis L. Sexton; and A bill (S. 2144) for the relief of Benjamin Yarborough; to the Committee on Military Affairs. A bill (S. 2145) granting a pension to William Nire Metz; A bill (S. 2146) granting an increase of pension to Mary J. Pennington; A bill (S. 2147) granting a pension to Clarence R. Boyles; and A bill (S. 2148) granting an Increase of pension to Rhoda E. Luse; to the Committee on Pensions. A bill (S. 2149) for the relief of Joseph C. HoUey; to the Committee on Post Offices and Post Roads. By Mr. McNARY: A bill (S. 2150) for the relief of Clarence J. Burris; to the Committee on Finance. A bill (S. 2151) for the relief of Marinius M. Londahl; to the Committee on Military Affairs. By Mr. BARKLEY: A bill (S. 2153) for the relief of Pinkie Osborne; A bill (S. 2154) for the relief of James Clay Colson; and A bill (S. 2155) for the reUef of the estate of Martin Preston, deceased; to the Committee on Claims. A bill (S. 2156) for the relief of the American-La France and Foamite Corporation of New York; to the Committee on Finance. A bill (S. 2157) for the relief of Matthew J. Isaac; to the Committee on Military Affairs. A bill (S. 2158) for the relief of Robert N. WaUace; to the Committee on Naval Affairs. A bill (S. 2159) granting a pension to Gillis S. Mitchell; A bill (S. 2160) granting a pension to Juriah Hyden; A bill (S. 2161) granting a pension to Dora McCallister; A bill (S. 2162) granting a pension to Maggie Ball; A bill (S. 2163) granting a pension to Gertrude Briggs; A bill (S. 2164) granting a pension to Levi Sawyer; A bill (S. 2165) granting a pension to Alexander Steele; A bill (S. 2186) granting a pension to Lucinda Van Norsdel; A bill (S. 2167) granting a pension to Margaret Moore; A bill (S. 2168) granting a pension to Mary Krebs; A bill (S. 2169) granting a pension to Wiley Roberts; A bill (S. 2170) granting a pension to Mary Curry; A bill (S. 2171) granting a pension to Dora Short; A bill tS. 2172) granting a pension to Frank House; A bill (S. 2173) granting a pension to John R. Sparks; A bill (8. 2174) granting a pension to Viola Compton; A bill (S. 2175) granting a pension to Maggie Wilson; A bill (8. 2176) granting a pension to Ellanor Green; A bill (8. 2177) granting a pension to Ella Noe; A bill (8. 2178) granting a pension to Allen Nantz; A bill (8. 2179) granting a pension to Lydia Ann Hollings- worth; A bill (8. 2180) granting a pension to Mary Shelton; A bill (8. 2181) granting a pension to Sam H. Hadley; A bill (8. 2182) granting a pension to John C. HounsheU; A bill (8. 2183) granting a pension to Gertrude Maurer; A bill (8. 2184) granting a pension to lliomas K. Morrison; A bill (8. 2186) granting a pension to Phihp T. West: A bill (8. 2186) granting a pension to Nancy V. Shipley; A bill (S. 2187) granting a pension to Daniel Wilson; A bill (S. 2188) granting a pension to Sarah Jane LewLi Langdon; A bUl (8. 2189) granting a pension to Delia England: A bill (8. 2190) granting a pension to Minnie Harrison;. A bill (S. 2191) granting a pension to Aleck Camlin; A bill (S. 2192) granting a pension to Nancy C. Buck; A bill (S. 2193) granting a pension to John Winn; and A bill (S. 2194) granting a pension to Elizabeth M. Run- nels; to the Committee on Pensions. By Mr. HATFIELD: A bill (8. 2195) making Nancy J. Litman eligible to re- ceive the benefits of the Civil Service ReUrement Act; to the Committee on Civil Service. A bill (S. 2196) for the relief of the Kleeson Co.. of MoundsviUe, W.Va.; A bill (S. 2197) for the relief of George L. Stone; A bill (8. 2198) for the relief of John B. Canter; A bill (S. 2199) for the reUef of James Monroe CapUnger; A bill (8. 2200) for the relief of Mrs. Charles L. Reed; and A biU (S. 2201) for the relief of the NeiU Grocery Co.; to the Committee on Claims. A bUl (8. 2202) for the reUef of W. E. Sturgeon; A bill (8. 22C3) for the reUef of James Evans; A bill (S. 2204) for the relief of James Johnson; A bill (8. 2205) for the relief of William Homer Johnson; A bill (S. 2206) for the relief of George E. Kirk, aUas George R. Keener; A bill (8. 2207) for the relief of Sarah Uoyd; A bill (8. 2208) for the relief of John M. Moore; A bill (S. 2209) for the relief of Charles P. McDonald; * A bill (S. 2210) for the relief of Francis L. Sexton: and A bill (S. 2211) for the relief of Richard J. Slater; to the Committee on Military Affairs. A bUl (8. 2212) granting a pension to Mollie M. Carr; A bill (8. 2213) granting a pension to certain persons held as slaves on January 1, 1863; A bill (8. 2214) granting a pension to Araminta Webb; A bill (8. 2215) granting a pension to Samuel W. Stewart; A bill (S. 2216) granting a pension to Margaret J. Mc- Clure; A bill (S. 2217) granting a pension to J. E. Barrows; A bill (8. 2218) granting a pension to Clara V. Crossland; A bill (S. 2219) granting a pension to Elizabeth Frasher; A bill (8. 2220) granting a pension to Edgar F. Heidler; A bill (S. 2221) granting a pension to Benjamin F. Mathers, Jr.; A bill (S. 2222) granting a pension to Carrie B. Mozingo; A bill (S. 2223) granting a pension to William B. Mullins; and A bill (S. 2224) granting a pension to Elijah Stephens; to the Committee on Pensions. By Mr. ROBINSON of Arkansas: A bill (8. 2225) to provide for the establishment of a cor- poration to aid in tlxe refinancing of farm debts, and for other purposes; to the Committee on Ranking and Currency. By Mr. ROBINSON of Indiana: A bill (8. 2226) for the relief of WiUiam H. Humphreys; to the Committee on Claims. By Mr. FLETCHER: A bill (8. 2227) for the relief of Harold S. Shepardson; to the Committee on Military Affairs. A bill (8. 2228) grantixig a pension to Minnie Phelps; and A biU (S. 2229) granting a pension to Minnie L. Stewart; to the Committee on Pensions. By Mr. POPE: A joint resolution (SJltes. 69) proposing an amendment to article V of the Constitution of the United States, pro- viding for the popular amendment of said Constitution; to the Committee on the Judiciary. Lxxvin- -ao 306 "^' i^ CONGRESSIONAL RECORD— SENATE January lo By Mr. SHEPPARD: A Joint resolution (S.JJles. 71) to repeal an act approved February 17. 1933, entitled "An act for the relief of Tami ico Marine Iron Works ", and to provide for the relief of V fil liam Saenger, chairman liquidating committee of the Beiu mont Export ii Import Co.. of Beaumont, Tex.; to me Committee on Claims. PROPERTY OF MOTTNT PLEASANT IKDIAH SCHOOL, IDCHIGA] r Mr. VANDENBERG. Mr. President, under the economy bill last year the Indian school at Mount Pleasant, Mi^h., was abandoned, and all of the Indians have been pi the reerular educational system. It has now become desirable for the State of Michigan officially to take this Indian school property and amalgamate it into institutional system of the State of Michigan. I am, thi fore, introducing a bill for that purpose with the entire sent of the Bureau of Indian Affairs and the Departmenlj of the Interior. I urge the emergency nature of the sit tlon. with a request for the earliest possible actum by committee. The VICE PRESIDENT. The bill will be received and appropriately referred. The bill (S. 2152) granting certain property to the Stite of Michigan for Institutional purposes was read twice by Its title axKl referred to the Committee oa Indian Affairs. JOHN C. MERRTAli Mr. ROBINSON of Arkansas. Mr. President, I introduce a Joint resolution and ask that it be read. Then I stall ask for its present consideration. The VICE PRESIDENT. The Joint resoluticm win be read. The Joint resolution (S.JJles. 70) to provide for the -e- appointment of Jotin C. Merriam as a member of the Bm rd of Regents of the Smithsonian Institution, was read the first time by its title and the second time at length, as follows: Resolved, etc.. That the vacancy In the Board of Regents of the Smithsonian Institution, oi the class other than Members of Congress, caused by the expiration of the term of John C. Msr- rUm. of the city erf Waahitigton. on December ao. 1933, be fll ed by the reappointment of the recent incumbent John C. Merrli tm for the statutory term of 6 years. The VICE PRESIDENT. Is there objection to the pres- ent consideration of the joint resolution? Mr. McNARY. Mr. President, I did not imderstand ttat the Senator from Arkansas made a request for immedii te consideration. Mr. ROBINSON of Arkansas. Yes. Mr. President. Mr. McNARY. I see no emergency. I think the Joint resolution should go over for the day. Mr. ROBINSON or Arkansas. May I state for the Recc rd some information which I think the Senate would like to have? I do not believe that the Senator from Oregan will persist in his objection when the information has besn supplied. John C. Merriam is a native of the State of Iowa. He i very eminent scientist; professor of paleontology and d of faculties in the University of California; president of Carnegie Institution of Washington since 1921; member _. the National Academy of Sciences, of which he was vice president and member of council; president of the Geologic al Society of America; member of numerous scientific societ es here and abroad; a research- authority on fossil manunal a, especially of the United States, and quite prtwainent Ihi educational affairs. Mr. Merriam 's term on the board at r^ents expire December 20, 1933; and, the Congress not being in sessicn, no opportunity arose for the immediate filling of the vi- cancy. Ctf course, if the Senator from Oregon dcsii«s to persist in his objection, I shall not press the matter at tt is time. Mr. McNARY. The biography of Mr. Merriam is very in- teresting, but it bears no relation to any emergency. :^r that reason, since it is my policy to object in such cases, must insist on my objection. Mr. ROBINSON of Arkansas. Very well, Mr. President. The VICE PRESIDENT. Objection being made, the joint resolution will lie on the table. FOREIGN POOD PRODUCTS PURCHASED BY WAR DEPARTMENT Mr. ROBINSON of Indiana. Mr. President, I submit a resolution and ask unanimous consent for its immediate consideration. The VICE PRESIDENT. The clerk will read the resolu- tion. The Chief Clerk read the resolution (SJles. 125), as follows: Whereas it is reported In the public press that during the year 1933 large amounts of foreign food products were purchased under the direction of the Secretary of War for use in supplying rations to the Army and the ClTilian Confervatlon Corps; and Whereas there appeared in the Washington Herald for the morn- ing of January 9, 1934, the following article: "AKMT and C.C.C. to ' EAT AMEKICAIT ' " The Army and the C.C.C. will consume American products only this year. " La.st spring considerable Argentine beef was pxirchaaed. but Assistant Secretary of War Woodring assured President Roosevelt yesterday that this won't happen again. - The • doughboys ' will also get more cheese this year. In response to the demands of dairy Interests, the Army will pur- chase 1,000,000 pounds for rations": Therefore be It Resolved, That the Secretary of War Is requested to transmit to the Senate, as soon as practicable, a report showing the amounts of foreign beef and other foreign food products purchased by the War Department since March 4, 1933, for the use of the Army and the Civilian Conservation Corps, and the prices paid therefor. The VICE PRESIDENT. Is there objection to the present consideration of the resolution? Mr. ROBINSON of Arkansas. Mr. President, can the Senator from Indiana inform the Senate whether pur- chases of foreign products for food purposes by the War Department were made prior to March 4, 1933? Mr. ROBINSON of Indiana. I cannot, Mr. President. I am willing to have the resolution amended, if the Senator desires it. to include the time before March 4, 1933. Mr. ROBINSON of Arkansas. I do not know myself what the facts are. Mr. ROBINSON of Indiana. I do not know, I am sure. I just understood that this report had been made by the Secretary of War to the President that no more foreign food would be bought by the War Department, and that is why I thought the Senate ought to know how much of It has been bought by the Secretary of War. Mr. ROBINSON of Arkansas. Very weU. The Senator would not object to the resolution going over until tomorrow so that I may examine it and see if I desire to offer an amendment? Mr. ROBINSON of Indiana. Not at all. The VICE PRESIDENT. Without objection, the resolution will go over under the rule until tomorrow. REPORTS OP GOVERNKENT OBLIGATIONS Mr. DICKINSON. Mr. President, I send to the desk a res- olution and ask for its immediate consideration. The VICE PRESIDENT. The resolution will be read. The legislative clerk read the resolution (SJies. 126), as follows : Whereas SzecutiTe Order No. 6548, dated January 3, 1934, has been revoked and an Executive order In lieu thereof issued, read- ing. In part, as follows: " It is hereby ordered that all executive departments (other than the Treasury Department), Independent establishments, agencies, and Instrvmientalltles of the Unil«d States, Including corporations without capital stock which iwe owned by the Government and corporations with capital stocic of which 60 percent or more Is owned by the Government, exctpt corporations which were in existence prior to January 1, 1932, shall hereafter submit to the Director of the Budget a weekly report conUining an Itemized statement of all allocations of funds made during the preceding week out of any emergency appropriation or other available emergency fund, and a weekly report containing an Itemized statement of all obligations incurred during the pre- ceding week for the expenditure of any emergency appropriation or other available emergency fund. Such reports shall Include the allocation of funds and the incurring of obligations through the Issuance of securities. The Director of the Budget shall keep a current compilation and tabulation of the above-mentioned aUo- caUi»u aod obligations ao reported and from time to time make OAO nnxm-oj^dcurwi a "DTrrTkDTi OfXTArrf T A XTTT k nvr "1 rt 1934 CONGRESSIONAL RECORD— SENATE 307 such recommendation* thereon to the President as he may deem advisable ": Resolved. That a copy of all said reports fiirnlshed the DU-ector of the Budget be filed with the Secretary of the Senate for the Information of the Senate. Mr. ROBINSON of Arkansas. Let the resolution go over, Mr. President. The VICE PRESIDENT. The resolution will go over under the rule. Mr. DICKINSON. Mr. President, in view of the fact that it has been requested that my resolution lie over until to- morrow, I wish to make a brief explanation of it. I did not intend to make any remarks at this time, but I think the Senate should have some information which they can use to consider the merits of the resolution. As I say, I did not intend to explain the resolution; but I think I will take this opportunity of making some remarks relative to the merits of it. Mr. ROBINSON of Arkansas. Mr. President. I call to the attention of the Senator from Iowa the fact that there is nothing before the Senate. The Senator from Mississippi fMr. HAnRisoN] intends to move the consideration of a bill. If that is done, of course, the Senator from Iowa then will have an opportunity to make the statement he has in mind. Mr. DICKINSON. Very well. AMERICAN NATIONAL MARITIME BOARD The VICE PRESIDENT. The Chair lays before the Sen- ate a resolution coming over from a previous day, which will be stated. The Chief Clerk read Senate Resolution 122, submitted by Mr. Johnson on the 8th instant, as follows: Whereas the development and successful operation of an Ameri- can merchant marine Is. to a very large degree, based upon Intelligent cooperation and good will botT.een managers of opera- tion and the personnel aboard the ships; and Whereas the value of such cooperation &nd desirability of establishing and maintaining such harmonious relatirns has been fully recognized by two of the world's grent maritime nations. Great Britain and Japan, in each of which national maritime boards have been organized Jointly by shipowners and seamen for the express purpose of securing cooperation and fcsterlu!? the sea power and the maritime supremacy of the respactlve nations: and Whereas cooperation and the promotion of harmonious relations between American shipowners and American seamen could be ob- tained by means of an American national maritime board with the following objects and purposes: (a) The development of seamanship, skill, and efficiency. (b) The prevention and adjustment of differences between ship- owners and seamen of all ratings. (c) The establishment, revision, and maintenance of standard rates of wages and approved conditions of employment in the merchant marine. (d) The selection and. when possible, the operation of employ- ment ofBces for seamen in cooperation with the United States De- partments of Commerce and Labor: Therefore be it Resolved, That the Secretary of the Department of Commerce, the Secretary of the Department of Labor, and the Postmaster General be, and they are hereby, requested to confer upon the advlsabUity of initiating an American national maritime board, as herein outlined, and for that purpose to call into conference such representatives of shipowners and seamen as may. in their Judgment, be helpful in the formation of such an organization, and to report their proceedings and their conclusions to the Senate. Mr. KING. Mr. President, will the Senator from Cali- fornia permit an inquiry? Is the Senator advised as to the attitude of Mr. Puruseth, head of the seamen's organization, with respect to this movement? Mr. JOHNSON. That organization is favorable to it. Mr. KING. Is there any organization now in any of the departments of the Government that can or would accom- plish the results sought here? Mr. JOHNSON. I think not. Mr. ROBINSON of Arkansas. Mr. President, as I read the resolution, it is a mere invitation or suggestion to the three Cabinet members named to make the investigation and report indicated in the resolution. Mr. JOHNSON. Purely a request that they confer. Mr. McKELLAR. Mr. President, will the Senator advise us whether or not there will be included in this matter any question relating to subsidy? Mr. JOHNSON. There was no such design. Mr. McKELLAR. Certainly not. The VICE PRESIDENT. The question is on agreeing to the resolution. The resolution was agreed to. The preamble was agreed to. SKNATOR rKOM LOUISIANA Mr. ASHURST. Mr. President. I wish to secure the entry of an order. Within* the past 7 or 8 months there have been referred to the Senate Committee on the Judiciary a large number of telegrams and letters, possibly in all a thousand or more, relating to the senior Senator from Louisiana [Mr. Long]. Upon a perusal of these documents it is obvious that these telegrams and letters. In the nature of petitions, should be sent to the Committee on Privileges and Elections and not to the Committee on the Judiciary. I therefore ask an order that these petitions, to wit, letters and telegrams heretofore received and those hereafter to be received respecting that subject may be referred to the Committee on Privileges and Elections, as the Committee on the Judiciary has no jurisdiction in the premises. The VICE PRESIDENT. Is Uiere objection to the request of the Senator from Arizona? Mr. BARKLEY. Mr. President, reserving the right to ob- ject, wliich I shall not do, but merely as a matter of seeking information. I inquire of the Senator from Arizona if thoss petitions, resolutions, letters, and telegrams pertain to the question of the right of anyone to hold a seat in this Cham- ber because of any question as to elections, or do they relate to charges against any Senator with reference to conduct of which he may or may not be guilty as a Senator? As I understand it, the Committee on Privileges and Elections has jurisdiction to pass upon questions involving the election of Senators, but any charges affecting the conduct of one as a Senator without regard to his election should properly go to the Committee on the Judiciary. Is that correct? Mr. ASHURST. I am of opinion that charges even so serious as to be a reflection upon the character of a Senator should go to the Committee on Privileges and Elections. I do not desire to recount the nature of these petitions because it is not fair to do so now; some are respectful in form and nature and some not quite so respectful in form and nature. After a consultation with many members, if not with all members of the Committee on the Judiciary, I am of opinion that the petitions relating to the seat of the senior senator from Louisiana should be sent to the Committee on Privileges and Elections. Let it ba remembered that the Senate in the last session directed the Committee on the Judiciary to make investiga- tion of a certain legal question involving a matter of privi- lege and also indirectly relating to the senior Senator from Louisiana. A subcommittee of the Senate Committee on the Judiciary was appointed, composed of seven members, to examine that question of law. The chairman of the sub- . committee is the senior Senator from Utah [Mr. Kxifcl. The Senate Committee on the Judiciary is not asking to be relieved of its duty in that respect. Indeed no subcom- mittee has worked more diligently or with more assiduity than that subcommittee. I ask that the papers relating to the right of the senior Senator from Louisiana to a seat in this body be referred to the Conmiittee on Privileges and Elections. Mr. BARKLEY. Would that take away from the Com- mittee on the Judiciary all matters pertaining and relating to the senior Senator from Louisiana? Mr. ASHURST. It would except the one question upon which the Senate instructed the committee to make report upon a question of law. The VICE PRESIDENT. Is there objection to the re- quest of the Senator from Arizona? Mr. LOGAN. Mr. President, I am not going to make any objection to it. but I do desire to make the statement that an examination of similar cases shows that they have been disposed of in three ways. They have many times been sent to the Committee on the Judiciary. They have many times been sent to the Committee on Privileges and Elections. At other times special committees have been appointed to consider them. I do not know the particular reason why 308 CONGRESSIONAL RECORD— SENATE 4 January 10 1934 these matters ahookl go to the Committee on Privileges md Elections, but as I happen to be a member of both cn I shall endeavor to have the subcommittee meet and t ike such steps in the matter as are deemed proper. I am sure the subcommittee, as well as all the memben of the Judiciary Committee, are desirous of having this mat er. which is before tiiem, disposed of at an early date. Tiat this will be done. I have no doubt. KSPBAI. or rSDCRAL PSOHIBITION LAWS IN rUXKTO UCO- - AMEMOMKNT Mr. TYDINGS submitted an amendment intended to be proposed by him to the title of the bill (S. 2107) to repeal Federal liquor prohibition laws to the extent they are in force in Puerto Rico, which, with the accompanying pajer, was referred to the Committee on Territories and Instlar Affairs, and ordered to be printed. MXAJrUffO OF SOVIKT IKCOCHTnOlf Mr. WALSH. Mr. President, I present and ask that th ere be printed in the Congrsssional RxcotD a radio address le- livered by Rev. Edmund A. Walsh. S J., PhJD., vice preside ;nt of Georgetown University, under the auspices of the Am< ri- can AQlance of the United States, over tbe National Broi id- casting Co. network, on December 9, 1933. on the subject What Recognition of Soviet Russia Means. There being no objection, the address was ordered to be printed in the Rscoro. as follows: WHAT sacooNinoN or sovtst tnssiA itxans For 10 yean I have steadfastly opposed recognition of Soilet RoaBla on the groonds of public pcUcy and beeaiise WHureoognlt on at tbe Union ot acrriet Socialist Republics was clearly In accord with the traditional policy of the United States In respect to new governments and newly formed States. Recognition ts an act of national political expedltucy. It Is granted when Judged In the best Interests of the recognizing party and withheld when diplo- matic relations would seem harmful, prejudicial, or Inopportune. There is no Juridical right to recognition, and there Is no legal or moral obligation to recognize. Recognition does not Imply ap- proval of any particular form of government any more than the dally Intercourse of business life Involves approbation of the per- sonal conduct or domestic relations of the merchant from whom we buy commodities. Neither, on the other hand, does nonrecognl- tlon necessarily imply censure of an existing form of government. Still leas does it constitute interference In the Internal affairs of the nonrecognized part, any more than my refusal to Invite a specific person to my dinner table constitutes an affront to his social reputation or Imposes an unwarranted restriction on his freedom of action. To be sure, recognition of a succession government In modern times normally followed a successful revolution as a matter of customary international procedure, provided no obstacle to mutual friendship e.xisted. While not implying either the censure or ap- probation, which I have already excluded, recognition does, how- ever, presuppose mutual respect and a decent regard for those International amenities and obligations without which diplomatic relations would be a sham, a lie, and at best but an armed armistice or a nervous neutrality. In the present case there existed for many years Just such an obstacle, deliberately created by Moscow, which constituted the main hindrance to recognition of the Soviet Union. American policy and practice have been governed by two simple considerations clearly set forth by that eminent Jurist, John Basset Moore, In his monimiental International Law Digest: ■' 1. That the government seelcing recognition shall be In de facto possession and control of the territory over which it claims Juris- diction without substantial revolt or opposition on the part of Its population. We do not demand legitimacy of succession, nor do we Inquire Into the validity of the possessor's title. " 2. That the government in question shall be able and willing to perform its international obligations and conform to the usages accepted by the civilized nations of the world. Failure to conform to these obligations Is sufficient grounds for refusing recogni- tion." That the present Soviet Government had long fulfilled the first requirement Is not questioned. That It has hitherto evaded that reasonable second requirement by maintaining on Its territory the Third International Is matter of public record. During the recent negotiations comprehensive and formal guar- anties of an unprecedented character in several fields were made by the Soviet Government prior to recognition. This, In itself, was a significant abandonment of the previous Soviet policy, which uniformly demanded recognition first and detailed discussion and mutual guaranties to follow. Mr. LitvlnofTs Government. In paragraph 4 of his letter on propaganda and noninterference, undertakes specifically " not to permit the fCMination or residence on its territory of any organiza- tion or group, and to prevent the activity on its territory of any organization or group or any representatives or officials of any organization or group, which has as an aim the overthrow or preparation for the overthrow of, or the bringing about by force of a change in. the political or social order of the whole or any part of the United States, its Territories, or possessions." There Is at present in residence on Soviet territory, housed In a Government building not far from the Kremlin, a well-known organization highly developed with international ramifications and notoriously hostile to this country. It Is known as the " Third International." It was created in 1919 when Lenin, then head of the Soviet Government, sent out on Government telegraph wires an appeal to selected radicals and revolutionaries In foreign lands bidding them come to Moscow as guesu of the Soviet Government. There, under official sanction and with Soviet support, a new organization was set up to function as a sort of Soviet mluLstry for that world-wide Communist revolution which was scheduled to follow the Bolshevist triumph In Russia. Its statutes depict the Third International as the unifying agency which consolidates the Ck>mmunist parties of the different countries Into a single world instrumentality for the overthrow of all non-Communist governments, be they friendly or hostile. The organleatlon Is seml- mlllUry in character and wholly mUltary In discipline, the Com- munist Party of each respective country becoming a section In this Communist International and receiving orders which are manda- tory and programs of attack from the general headquarters in Moscow. These Instructions are very explicit and were best formu- lated by that extraordinary sixth congress of the Comintern. The decisions of these congresses are compulsory for all sections In every country. Including the United SUtes, and must be exe- cuted immediately without deviation. In pursuance of Its purposes the Comintern created an appropriate American division, housed In Its headquarters at 1 Sapojkcvskala, Moscow (telephone 28-60 to 28-54). devoted to the preparation of ways and means for the over- throw by force of those fundamental liberties and Institutions which are guaranteed to American citizens by article 4, section 4, of the Constitution of the United States: "The United States shall guarantee to every State In this Union a republican form of gov- ernment • • ••• Stenographic reports of Its deliberations are available, and Its specific program with regard to the United States is matter of public record. Mr. Stalin has long been a member of the execu- CONGRESSIONAL RECORD— SENATE 809 tlve committee of the Communist International and on May 6. 1929, he personally delivered definite and voluminous Instruc- tions to a so-called "American Commission " with respect to the methods of achieving the changes In our social and political forms mentioned by Mr. LitvinofT. The authentic text of Mr. Stalin's remarks on that occasion are on file In the State Department. Washington. And as late as October 1932 instructions were issued from the same source, directed to American members of the Com- munist Party, calling for positive acts of aggression against Amer- ican institutions. Ways and means are pointed out to capitalize unemployment and fan purely local incidents of minor Importance Into major revolutionary outbreaks. Again, we are informed by reliable foreign correspondents, on Monday, October 23, 1933, there was published in Moscow, by the printing plant of Krestlanskaia Gazeta — a Government organ — and passed by the Soviet censor, a savage attack on Presi- dent Roosevelt, on the NJl_A., and the American Federation of Labor. Among other things, the diatribe of the Moscow Trade Union International said: " The Communist Party and revolutionary organizations can and must become the sole leaders of the North American broad masses • • • against Roosevelt's program • • •. It Is necessary to dispel the Illusions still existing among the workers and to exploit the wave of discontent that Is rising, particularly In connection with the practical application of Roosevelt's meas- ures • • •. It is necessary to convert this discontent into a gigantic struggle of the proletariat of the United States • • •. There were some delays on the part of our revolutionary organi- zations in properly estimating Mr. Roosevelt's program, but now they have formulated their counterprogram and are developing revolutionary activities intensively. Investigation of the masses In open fight and the developing of strikes against the admin- istration's measures are the chief points of this program. " The struggle of the working class of the United States against Roosevelt's plan, against preparations for an imperialist war, and In defense of the Soviet Union can and must be waged only under the leadership of the Communist Party and by stubbornly fol- lowing the correct line laid down In these Instructions connecting everyday demands with the final goal of the class war and pushing forward the program for a revolutionary issue from the crisis." The important point here is not what members of the American Communist Party may do in their capacity as citizens of the United States, but that this hostile provocation to violence should have been launched with Soviet approval at the very moment that Mr. Lltvlnoff was preparing to start for Washington bearing an olive branch and uttering his usual guaranties about Inter- national peace. On November 16, 1933, the Soviet Government, through Its Commissar for Foreign Affairs, pledged itself unequivocally to terminate the residence on its territory of any organization or group and to prevent the activity on its territory of any organiza- tion or group which alms at the overthrow by force or which prepares the way for such a contemplated overthrow of American Institutions. That promise can mean only one thing — the Third International. This pledge does not concern those secondary problems such as debts — which were postponed by agreement with President Roosevelt for later consideration — but is a primary guaranty Immediately operative. The political success or failure of the experiment consequently rests fairly and squarely on the shoul- ders of the Soviet Government, which Is now under solemn cove- nant, openly and voluntarily arrived at, not only to disassociate Itself from but to end the Third International at least Insofar as the United States Is Involved. Delay or further evasion can result In only one logical conclusion — vmwllllngness to comply. If it pleads inability to control the Third International, It makes vir- tual confession that there is a political power within its terri- torial Jtirisdiction superior to and dominating government — hence the real sovereign. In that case, the Soviet Government does not exercise sovereignty and the United States should withdraw recog- nition and treat with the indicated ruler, not with a subordinate. That. I take It, would be the international law In the premises. It cannot be too often or too emphatically repeated that if the Soviet Government persists in clinging to the Third Interna- tional. It will n\illlfy the gesture toward International peace and normal relations Initiated by President Roosevelt and will render abortive, futile, and ridiculous the recent exchange of correspond- ence. There can be no return to normal relations anywhere so long as one of the parties to the contract retains, fosters, and protects on its territory a hostile and Intransigent organization which Is bound by its constitution and Its statutes to do the very things so clearly outlawed by Mr. Lltvlnoff in the fourth point of his first pledge. It Is not that I fear eventual disinte- gration of our Institutions as a result of the bombastic mani- festoes periodically broadcast from Moscow. Should such a disaster overtake us. It will arise from internal corruption, venality in high places, the lust for gold, and from social injus- tice, not from external aggression. What I do fear Is the loss of ovir self-respect should we surrender to a new impertinence of Interpretation, condone another international hypocrisy, and bar- ter the President's signature for a bill of exchange on Moscow. I know that Mr. Lltvlnoff, in reply to some newspaper corre- spondents, asserted while here that there ia no mention of the Third International in his pledge to President Roosevelt. "You must not read Into it more than was intended ", he said. There Is no need. The specifications are clear, comprehensive, and exact. If the Third International is not included, words have lost their meaning. If Mr. Lltvlnoff protests that the United Stetea must not read Into the document more than was Intended, the Amcrtean public has every right to expect that the President of the Unltad States will not permit Mr. Lltvlnoff to read out of the documents the very thing that was Intended. SAir PKOKO EIVXR, ARIZ., FLOOD COlfTKOL Mr. ASHURST. Mr. President, In the Seventy-second Congress the Senate directed a subcommittee of the Com- mittee on Irrigation emd Reclamation to make Investigation of the water resources of the San Pedro River in Arizona. I present a report from the subcommittee which was directed to make that investigation, and ask that it may be printed in the Rscord. There being no objection, the report was ordered to be printed in the Record, as follows: Flood Contboi. or Sam Pedbo Rivxr, Abzb. Mr. AsmrasT submitted the following report (pursuant to SJtes. 292. 72d Cong.) : — o i— xi- To TH« COMKirm OK IXXIOATIOM AKD RlCLAMATION, United States Setxate: Pursxiant to Senate Resolution 302. Seventy -second Congress, second session, agreed to by the Senate on Febniary 11, 1933. directing the Committee on Irrigation and Reclamation, or a duly authorized subcommittee thereof, to make a complete investiga- tion respecting the \iltlmate utilization of the water resources of the San Pedro River in the State of Arizona, Including irriga- tion, reclamation, flood-control, and power development, a sub- committee was on June 7, 1933. appointed to make the investiga- tion, which said subcommittee was composed of the following: HzNRT F. AsHUBST, Of Arizoua; Cijuuarai C. Dm,, of Washington: RoBEST D. Cabkt. of Wyoming. Complying with the requirements of the said resolxftlon, your subcommittee, on October 23 and 24, 1933, accompanied by Z^f- neer George O. Sanford, of the United States Reclamation Bureau, made a personal Investigation and hereby report and recommend as follows : The San Pedro Valley, together with the remainder of Arizona Isrlng south of the OUa River, was ceded to the United States by Mexico by the Gadsden Purchase. The San Pedro River rises near the International boundary line (United SUtes and Mexico) and flows through the San Pedro Valley In a northerly direction into the Gila River near Winkelman, Aria. The San Pedro River has many affluents from the Mule, Huachuca, Whetstone, and other mountains in southeastern Arizona, and It furnishes water for Irrlgratlon at several settlements along Its course. Rural social life Is developed to a high degree at these settlements In this San Pedro Valley. Schools and churches are numerous throughout this valley, telephones are In general use, electricity for lighting and for power Is obtainable, and marketo are available for the agricultural prod- ucta of the valley. The climata of this region may be classed as arid. The n^nfsOl, In the mountains and on the desert slopes adjacent to the San Pedro River, although variable, has a mean annual average of nearly 14 Inches. The rainfall for the wettest year on record at the Weather Bureau station at Benson was 22.58 Inches In 1905. The summers in this region are hot, though not oppressive. The water supply of the San Pedro River dvirlng the past 2S years of records published by the Geological Survey has ranged from a minimum of approximately 20,000 acre-feet per year to a maxlmvmi of 122,(XX} acre-feet per year. The average •"pv^l dis- charge Is approximately 60.000 acre-feet. The propoisltlon of a flood-control project would call for the construction of a dam built to a height of about 119 feet above stream bed. which would provide a storage reservoir with a ca- pacity of about 85,000 acre-feet. Such a reservoir would serve as an effective means of flood control on the Ban Pedro River, which the records show have occvirred with '"f««"iHTi discharges as follows: Cubic feet per teeond 1914 18. 000 1817 _ 6. 000 1919 M. 000 1921 19. (XX) 1923 4, 850 1925 _ 11, 900 1938 98. 000 1929 10. 400 193lIIIZIIZZIIIIZIir"ZIIIIIIIIIII~IIIZIIIII~IIII~III m! 600 1»32 7. 000 This flood-control dam and reservoir has been included In and recommended for construction in a report submitted under date of May 18, 1933, by the executive committee of the Arisona section of the American Society at Civil Engineers, an excerpt from which said report is as follows: " CHABUCSTOir DAM SrTB (H( SAIT "A flood of unprecedented proportloas. which reached a peak of 98.000 seoond-feet, swept down the San Pedro Valley during 8ep- tembor 1928. This flood Is indicative of what is to be expected from other similar watersheds in the State. Damages from this flood ran into the hundreds ol thousands oC dollars, to farm lands. I 310 CONGRESSIONAL RECORD— SENATE hIghwmyB, and railroads. Kothlng has been done on the San Pedro watershed since 1926, in the way of limiting grazing or soil-eroilon work, to reduce the Intensity of flood discharges. Putiire floods of equal or even greater proportions are to be expected. ■' Complete information on the damages incurred during the 1926 disaster is not available, due to the fact that losses susta ned by the Southern Pacific Railroad and individual farmers through- out the valley could not be secured in the short time allotted 1 to the committee for the preparation of this report. The highway departments of the State, and of Pinal and Cochise Counties, sj >ent a total of $176,700 in reconstruction of structures destroyec! by the flood. There Is no doubt that the Southern Pacific Co. s] »ent several times as much money in repairing lU>od damages to 1 aeir lines. Farmers along the river not only suffered crop losses sut. In addition, many acres of rich agriciiltural lands were waj hed •way. " It Is clearly evident from the Incomplete survey of past f ood damages that a large expenditure is Justified for the prevenLlon of future floods. There must be control over flood discharges to prevent the loss of valuable farm lands along the river. In aldi- tlon. a great reduction in the cost of operation of the San Carlos project would result. Large quantities of silt are carried by the San Pedro during flood periods, and as a part of this water Is diverted at the A&hurst-Hayden Dam, the silt Is carried into the canal system. Pull relief to the irrigation district would noi be afforded by a dam at the proposed Charleston site, but there w< luld be partial relief. " Studies of stream discharge on the San Pedro River show ^ hat the 1926 flood of 98.000 second-feet could have been reducet to 8.000 second-feet by a storage reservoir of 85,000 acre-feet capai ity. Since the 1936 flood Is the greatest on record. It Is evident that the proposed storage reservoir of 110,000 acre-feet would do much to prevent future flood danjage. "The Charleston site Is situated 6 miles upstream from F»ir- banJt." The flood-control dam proposed at the Charleston Dam site is a multiple-arch concrete dam. and the preliminary plans submi ted have been reviewed by the chief engineer of the Btireau of Re ^- matlon. who has prepared an estimate of cost- of approzlma telv In addition to the construction of the dam. It will be necesi lary ionmove 11 miles of the Southern Paclflc Railroad track wl ich passes through the reservoir site and the gorge where the < am would be constructed. Estlomtes of the cost of relocating this railroad have been i ire- pared, and the estimate submitted by the railroad company lev- eral years ago shows a cost for this work amounting to $1 150 >00 making a total estimated cost of »2.350.000 for a flood^on ;roi reservoir. Such reservoir would provide the necessary flood control on the Ban Pedro River and would effectively eliminate the poasiblUti of wrlous damage occurring to homes, farm lands, railroads, brld -es and highways which have heretofore been experienced when s ich floods occurred Whenever the reservoir might be filled from a flood discharge, the stored waters could be safely drawn off at si ich rate as to eliminate the possibility of damage, so that the reier- Tolr would be ready to hold any subsequent flood The San Psdro Valley has a population of about 4,730 persons the v^ley is relatively oblong and includes about 90 square BUles below the proposed flood-control dam. while the waters! led above the dam site has an area of about 1,300 square miles The betieflU to accrue from this expenditure of tXaacOOO %tt commensxirate to the amount of money propoaed to be exoenc ed The vital and durable benefit derived from the construction of i tils f^tT^JL"*! *" ".n"^**' °^^ course, be the ultimate prottction of £!, i2SS'v!fS!'/"^?'J*^***''"- ^^"^t**' »nd railroads In he Ban Pedro Valley from destruction by flood watery an obUgat on rerting upon the Federal Oovernment; another benefit, eouj lly Tltal and important, would come from furnishing immediate em- ployment to the large number of citizens of the county (Cochlie) Who have been out of work for a long time and who have In many cases been sustained by direct contributions from local State and county authorities. The financial condition of the i tiers and landowners residing in the San Pedro Valley and m the Tlcinlty of the river's course is such that they could lujt ^^f^ Wymento whatsoever of Federal funds expended Sr nrlgatlon or for flood control. k»"«»~ ^u* ^SS^f i* "*• ?*!*^*?* "^ equipment to construct the flo«» would come from oirt- M points, but all labor for eonstructlon of this flood-cont-ol S!?.,.*^ J**?*"°° "^ ">* ralhx>ad track could bTprSSc S JSiSd'Si.,?'* construction of the dam and relocatton^^ £ raUroad track would provide 18.800 man-months of work we. your subcommittee, have the honor respectfully to'recon- mead the oonstructionof the flood-control dsTaf Se (^aS^n Dam site on the San Pedro River. ^^^ui^^u HSWBT F. ASRtJaST. Claucmcb C. Dnx, RoaaiT D. Caskt. JANXjaaT S. 1934. "^ber, of the SubcommtUee AltSKICAR HOLDERS OF GSSMAH OBUGATIOIfS ISr. PLETCHKR. Mr. President, many American investors Individuato, and Institutions are interested in Ocnnan ob i* faUoDS of tbe lon«r-tenn and short-term varieties. There b«s been a study made of the subject by the American Coi January 10 ell of Foreign-Bond Holders. I have a letter from Dr. Winkler, iwesident of the council, transmitting a report on that sub- ject. I ask to have the letter and the report inserted in the Record. There being no objection, the letter and report were ordered to be printed in tlie Record, as follows: American Council of Foreign-Bond Holders. Inc., New York City, January 5, 1934. Hon. DtJNCAN U. Pletcher, r;ie United States Senate, Washington, B.C. Mt Dear Senator Fletcher: In view of the Interest on the part of American Investors. Institutions as well as Individuals. In Ger- man obligations of the long-term and so-called " short-term " varieties, outstanding at approximately $1,600,000,000. I feel that the enclosed study on the German situation, published by the American Council of Foreign-Bond Holders, should prove of In- terest. Since you have followed developments abroad as they relate to the status of America's foreign Investments more closely than any other American statesman. I felt that you might consider the enclosed report of sufficient Interest to warrant Its incorporation Into the Concression.u. Record. You were good enough to move that similar reports prepared by the American Council be embodied In the Record. With kind personal regards and beat wishes for a happy New Tear, I am. Cordially yours. Max Winkler, President. DR. SCHACHT PLEADS POVERTY The amount of German dollar bonds in default has reached the Impressive total of $916,509,100. Although a German law passed under date of June 9. 1933. providing for the suspension of pay- ment in foreign currency but for the deposit of marks to the credit of bondholders, such deposits to be transferred In cash as to 60 percent, was to become effective as from July 1. 1933. Amer- ican holders have received nothing to date. Moreover. If some, or even a majority, were to accept the German plan of payment, the fact remains tha*. It constitutes a distinct violation of original loan agreements. 30 that one is fully Justified in looking upon German dollar bonds as being in complete default at present, and In partial default as soon as the above plan will be In operation. Dr. Schacht and his cohorts have been laying the blame for the delay in the disbursement of the 50-percent cash payment, to tne slowness with which matters have been handled by Washington. Dr. Schacht may not be aware of what America Is fully conscious, namely, that the scrip which Is to be Issued to holders of German bonds wUl be purchased by Germany at half their face value, on condition that the transaction will increase Germany's foreign commerce. In other words, foreign Importers of German mer- chandise win be able to purchase 100 marks' worth of German goods for only 60 marks, and. since the Inherent position of the relchsmark Is such as to induce foreign owners to part with the currency at so marked a discount in relation to the officially quoted price, the supply of marks may be expected to be quite plentiful. In this way German shippers are being placed at an unfair advantage over merchants in other countries. It Is for these reasons that the authorization to distribute scrip and cash to bondholders may have been delayed. German bonds, interest and amortization on which, due in Jan- uary, are not scheduled to be met according to provUions of original loan agreements, are tabulated hereunder: A. OoTemraent and political miMi- visions (diroct and oontinxent): Consotidstsd Municipal Baden 7's. Bavarian Palat ins te 7's HeldelberK 7Vj's C«ntral Bank (or Agricultural 6's Consolidated Hydro- Electric of Upper WoerttemberE 7's Rhine Rhor Water 6's Ssxoa Pabli« Works 6'i Ori final amount Total B. Banking institutions: Qennan BoUdine and Land Bank 6Hs C. PnWic Utilities: Westphalia Unit. Electric fl's D. Industrial enterprises: Oerman General ElecUic 7'« Harpen Mining 6's Rbeinelbe Union 7's Siemens-TIalske 7's . . . Stinnw (Hugo) 7*8 TteU (Leonhard) 7H*s-... United Steel Works ft^'s " ' $4, MO. noo 3.800. no 1. soo. «« 3a 000. 000 4.oon.ono 10, 000. 000 6. 4&S. 000 Total. Grand total DeCnlts, July-December. Total defaults. ea 282.000 S.2JO.00O 2O.Q0aO0O Amount ootstand- Ing $3.«0T.,W)0 3, IM. sou 1,287.000 23.10U.000 3.671,000 a 900. 000 6.867.000 40, 651. 000 lU. OlNi, 000 10,000,000 25.000.000 5.000.000 11500.000 3.000,000 30,000,000 05,500,000 181, 035,000 900, 715, 0001773, 4,981. 19, :?57. 000 000 7. 70U. ( 8, 700, ( 20, 600, ( 2,900,( 4,90O,( 1.950,( 22,S00,( Interest due Sinking fund (ius («nl- nuiU)) f2.W.406 218.4151 96. S25 1.386.000 2.'»,970 534,000 352.020 $flo.ono auaooo 30.000 45U,0U0 66, W» 200,000 3,105.336 1,036,665 323,763 1.161.430 52,500 240.000 63':<,000| 522,000 1, 442. OOO! 303,025| 343,000l 146.: 1.462,! 250.000 250.0olnted." It is my duty to tell you that the district attorney, marshal. collector of Internal revenue, collector of customs, and register of the local land office, respectively, will be appointed upon the recommendations of the United States Senators from Arizona. In my judgment. It would be lir-jroper for a Federal Senator to make any suggestion as to whom such persons thus recommended by Federal Senators should appoint. The Federal officials who may be appointed up>on my recommendation shall be left free to select their own assistants, deputies, accountants, and clerks. On this point I may be — probably am — censurably delicate, but it is my inflexible rule to which I adhered during the Wilson administrations. Quite naturally, I desire to please as many of my constituents as possible and to offend as few of them as possible, but I believe in the principle of absolute noninterference by Fed- eral Senators in the selection of the suoordinatcs of Federal officials appointed upon my recommendation. Sincerely yoiu's, HxNST F. AsmnsT. Octobsr 16, 1933. Mr. G. A. RoBERO, Phoenix, Ariz. Mt Dear Friend: Your letter received advising that the chamber of commerce had " denounced " Senator Hatoxn and myself for not securing larger sums of Federal funds for Arizona. This complaint of the chamber of commerce is not at all unique. for daily, from the mail bags, there are dumped upon my deak demands that " this, that, or the other " industry be novuished by some gift, bounty, or largess out of the Federal Treasury. I sympathize somewhat with the impatience of the chamber of commerce and say in reply that I have worked harder since March 4 last than I have ever worked before, but I am not com- plaining, for, when an officeholder complains of overwork, ha Is simply proving that he has a task too big for him. I have been for years a critic here and hope I am able, without making a wry face, to take a small dose of that medicine— criti- cism— of which I have given other fellows sizable doses; in other words. I not only " ladle it out " but can also " take It." Pardon my dropping into slang, but it conveys my thought precisely. I believe you are correct In your conclusion that a number of candidates — all excellent gentlemen — ^will try to displace me at the next election, but It Is beginning to appear as if I shall b« reelected, not by reason of any particular merit that I possess or by any political activity on my part, but by the folly of my opponents. I win see you at Phoenix on the aeth. Kind regards. Sincerely yourt, Hnrtr P. AsHtrMV. Hon. HoMxa 8. Cummtnoi. Dxcbmbxr 11, 1933. Attorney Oeneral, VTaihington, D.C. Mt Dear Ma. Attornet Gxjcsxal: I have tbe honor to writ* you regarding the alleged income-tax evasion supposed to have been practiced by former officials of the city of Phoenix, Ariz., regarding certain alleged bribery or alleged graft charges growing out of the construction of the water-pipe line for the city of Phoenix. A recent Issue of a Los Angeles newspaper which discussed thesa charges carried with it an implication that I had been indifferent or negligent regarding the Investigation of this alleged violation of law. and there was a ftirther Implication therein thpt I had written your Department or had adopted some other means of suggesting to yotir Department that these cases should be dropped. Quite naturally. I feel not a little concern over such an unjust and untrue Insinuation, for I have never Intimated that these cases or any other case shotild be abandoned, and, quite on the contrary, I wrote yotir Department on July 21, 19S3, in which letter I said (and now repeat) that I assume your Department will vigorously prosecute all violations of the income-tax law or other laws to the end that the guilty shall be promptly and adequately punished. I wrote you again on September 27 last urging prose- cution of all guilty persons involved in the above-mentioned viola- tions of law. With high esteem, respectfully yours, Hxnxt F. AaHuasT. DSCKMBKX 18, 1933. Mr. W. H. PrrERSEw, 16 South Twentieth Avenue, Phoenix, Ariz. Dear Friend: Your letter of December 10 received requesting the pajrment of the adjusted-service (compensation) certificates before their maturity. During the years when no deficit existed in the Federal finances I supported the adjusted-servloe (compensation) legislation, and I do not believe I made any mistake in so voting. The question of cashing the adjusted-service (compensation) certificates before their mattirlty depends now upon the condition of the Federal Treasury. 312 CONGRESSIONAL RECORD— SENATE January 10 312 CONGRESSIONAL RECORD— SENATE ii If the Treasury may without disaster cash these certificates be- fore they fall due. I should, so far as I am able to perceive at ;his time, be Inclined to vote to cash the certificates now, provided always the Treasury may stand the strain. If, however, the Treasury may not meet this demand and cduld not pay the certificates before maturity. I would not vote, ind coiUd not be expected to vote, to bring a collapse of our natknal credit. It is a principle of my personal and political conduct, ind the same principle should guide governments, never to hold out a promise where such promise Is obviously incapable of fxUUl ment; in other words, do not make promises unless you are ceriain you can translate the promises into actuality. I decline to make promises that cannot be fiilfllled. I refuse to raise up hopes tliat I know will be dashed to the ground. I shall Indeed give careful consideration to and make a close Investigation of the question of the ability of the Treasury to pay these certificates before their matxirlty. I realize that the phrase " give caref\il consideration and n^ke a close examination" is sometimes used as a polite euphemism for postponed negation, but I am not using the phrase in that sense, for I shall examine the subject in the hope of finding that the Treas\ury*s condition may Justify my voting to pay the cer- tificates before they are actually due; and If, upon Investlgat on, the facts show that the Treasury cannot stand that strain, I s lall not be a party to an insincere gestvire of pretending to pay| an Immature obligation out of an empty Treasury. Kind regards. Cordially yours, HxmtT F. ASHTTHS^ jAiruAKT a, 1931 ICr. A. L. MooKB. Route 2, Box 223. Tueaon, Ariz. Deab FaiXNTo: Your letter of December 25 received. In wlilch you say. " I ask you to work for and vote for repeal of ihis Economy Act." I should be lacking In frankness and deficient in courtesi If X failed to tell you that I shall support President Roosevelt! all along the line. A crisis of terrible proportions, bringing many distressful re- sults, ctune upon our country and has not lifted its blight fiom us; hence all citizens must continue to make sacrifices for t|ielr country's welfare. It is often quite true that the only way In which an ofllce holder may render great service to the Nation, in Its day of trouble. Is by his willingness to lose his future or at least to ose his present position In political life, if he may thereby aid in bringing national recovery. Just as the soldier may for a t ma f[lve up a part of his civil liberties and may pay with his phys cal Ife In order to render service for his country In battle. Whenever gra\e danger comee to our Nation, whether f^m unemployment, famine, fire, flood, war. pestilence, or depress! the ofllceholder must be willing to take action which might temporarily unpopular If he may thereby aid in the recovery his country. I -shall follow the President's leadership, and if he should lirge that the present law be amended so as to meet your reques , I shall support his efforts In that behalf. Kind regards. Sincerely yours. HoniT F. ASHTTBS" ADDRESS BY ATTOSKSY GENERAL CUMICINCS Mr. BARKLEY. Mr. President, at the last meeting of the American Bar Association, at Grand Rapids, Mich.. Augist 31. 1933, the Attorney General, Hon. Homer Cummings, le- bvered a very notable address on Modem Tendencies and he Law. I desire to ask that it be printed as a Senate docum^t and also that it be printed in the Record. The VICE PRESIDENT. Is there obJecUon? The Chfcir bears none, and it is so ordered. The address is as follows: Jar tfl 3lC discusBj sn sugs est Kn- outs Ide Mr. Chairman. Mr. President, members of the American Asaociatlon. ladies, and gentlemen, the somewhat exalted I have been asked to consider seems to Invite a learned An adequate treatment of its various aspects and lmpllcatli>ns would. I fear, lead me into pretty deep water. I have no such venturesome purpose in mind. I say this not only to give yo^ a needed, and. I dare say. welcome reassurance, but also to suj that what is going forward at Washington Is so completely grossing that but little opportimlty is afforded to stazxl events and assess their value. We Americans are much given to quick generalizations have a weakness for headlines. In a certain fashion we that we are apt to be misled by them, but that does not _ shake our faith In them. We generalize our hopes, fears ▼irtues. plans, and ideals — give them a name, and then more of the name than of the substance. We talk of law. Inherent rights, fundamental liberty, equality of op|. and social Justice until these concepts register more as tkms than as realities. For this reason we are apt to be bewildered when some movement like the nev» deal comes along a-n^ to treat Ideas and principles as living and vital thtwyy real Ize seem, vices thnk econoi lie opportun: ty abstric klere< setks January 10 We ze to It is interesting to note that already this movement presents, In some of Its aspects, a slightly distorted pictxire, because of the mystic potencies and weaknesses of mere names. Would it assert new Executive powers. It becomes a dictatorship; would It com- pel needed changes, it becomes a revolution; would it put reli- ance upon the best intellects it can mobilize, it creates a " brain trust "; would It coordinate administrative functions, we behold a Bupercabinet; If it seeks to combat crime by attempts to bring the police agencies of the country Into closer cooperation, we find that Scotland Yard has been transplanted to America. Many of the current criticisms, as well as the excessive hopes It inspires, spring, I apprehend, very largely from this passion to generalize and to see it in the abstract for that which It is not. instead of in the concrete for that which it is. P\indamentally. all we can hope to do is to release and direct the vital forces that make for a healthy national life. I do not share the view that these efforts will resxilt In the creation of a new social order, even though I realize there are forces moving to that end. New social orders, like poets, tire bom; not made. Pressxire of necessity and wide-spread distress have made us acutely conscious of serious social maladjustments and have created a condition In which new Ideals and forces, long gestating, have a chance to be born; and, under conscious planning and leadership, they may give us something of a new order. " Great distress ". says Burke. " has never hitherto taught, and whilst the world lasts It never will teach, wise lessons to any p«rt of man- kind." Such counsels of despair, however, leav»- ix* as cold as do counsels of perfection; for I think the world does profit by its mistakes and miseries. If wise leadership shows it how. That, at least. Is the faith of the new deal. Underlying this faith Is. of course, something of a definitive philosophy with implications bound to have repercussions In the law. It assumes that we are In one of those historic eras of change In which It Is the province of government to lead, to assist, and to direct. Its first obligation naturally was to put Its own house In order — to face the exigent needs of economy, eCRclency, and solvency; and then to deal affirmatively and vigorously with the conditions which have caused so much heart-breaking misery and distress. Manifestly, the crisis was far too acute to permit of prayerful waiting for the curative forces of patient time. It is a peculiarity of political, as well as Juristic thinking, in Its earlier phases always to seem more theoretical than practical. Presently, however, we see it penetrating and vivifying the social consciousness; and when time, circumstance, and the leader meet, it becomes a revitalizing force, a new movement, a new deal, and. sometimes, a new order. Witness the effect of academic thinking In shaping the Revolution of 1776, and that of the French; or note its even more striking bearing In the English reform movement of the last century, where such thinking changed the whole pattern of the social and economic order. The unifying principle which Ues at the heart of this modern movement Is to be found In the very old concept of cooperation. Indeed, this Idea seems so simple that Its very simplicity conceals Its tremendous strength and scope, as well as the basic part it has always played In the story of mankind. If it appears to be feeble or Utopian, consider for a moment certain patent facts. Note, for Instance, the many so-called " socialistic activities " which for many years have been an accepted part of our established order; and observe, also, the steady drift from the competitive to the cooperative ideal. " Rugged individualism ", so stimulating in pioneer days or even in a period of economic adolescence, no longer appears to be adapted to a highly relational society that constantly calls for disinterested service and greater solidarity. The competitive Ideal, so deeply Ingrained In oiu- law does n'lt seem to synchronize with considerations based on economic sta- bility and social unity. Surely It is not visionary, therefore, to regard cooperation, voluntary or even induced, as the way of lenjt resistance, if not the only way out; or as the one and probably only cure for ill-balanced production, for demoralization in com- petitive Indxistry, and for any threatened collapse of our social order. It was Bagehot, as I recall, who said that when an Englishman finds himself really thinking, he thinks he is sick, and I suspect that our own sudden compulsions to do stiff planning and hard thinking explain in part the fear that the country is much Bicker than It really is. Manifestly, local government has proved in many ways quite Incapable of meeting present emergencies. In the banking cnsis. which occxurred at the moment of Inauguration. It was to tne NaUon's Chief Executive and to national legislation that the country had to look for reUef. The colossal attempt under the NaUonal Recovery Act to spread labor and to raise wages and piirchasing power, and, imder the Agricultural Adjustment Act, to control crops and to make the farmer's product capable of supporting him. is a Federal effort to which the States and the people are lending willing support. The Department of Justice Itself Is the subject of demands for the Federal solution of prob- lems hitherto thought the proper subject of local control — rack- eteering, kidnaping, and the whole problem of crime. But centralLzaticn of power has been looked upon with distrust not only since the days of the Thirteen Colonies, but from time Inunemorlal. It was an ancient Greek who said that democracy could not sur- vive beyond the reach of the human voice. Clearly, he meant that the acts of the leader must be within the Immediate knowledge and subject to the direct approval of the people. The genius of local self-government lies in no mystery; it la In the axiom that If 1984 CONGRESSIONAL RECORD—SENATE 313 you want a thlnjj that concerns you well done, you must do It yourself. This was the idea Df the Greek city-state. This was the idea of the New England town meeting. This was the theory of ccionlal government la America, and of Its revolt against remote control. This was the basis of resistance to the formation of the Union, and it was fcr lack of central power tliat government failed liiidcr the Articles of Confederation. Tills was the theory that pre- served, in large measure, the sovereign powers of the States. At that point In our history, and for generations thereafter, this theo- ry of government worked exceedingly well. The Thirteen Original States were small in population and isolated. What was done In one, little affected any ether. The only democracy within reach of the magistrate's voice was the local democracy. President Washington was never heard at one time by all, or even a sub- stantial part, of the people; nor ■was Lincoln: nor even Wilson. But there have been changes. We are no longer a Nation whose problems are local and isolated. A bumper crop 100 years ago was a boon where It grew, or. at the worst, in part a waste. Today it may be a national menace. A shut-down of a grist mill or a smithy In Boston a century since was not felt in Rhode Island, much less in Pennsylvania. Today almost every economic and social problem is both local and national. Manufacturing, merchandising, transportation, agri- culture, mining, oil production, problems of employment and un- empluymcnt. of strikes and the settlement thereof, are upon a national scale, or. If local In scope, are national in effect. Child labcr in one State may destroy an Industry in another. Crime Is organized on a Natlcn-wlde basis. Neither the vigilance com- mittee of the old West nor the metropolitan police force of today can cope with tiiis problem without national aid. Goods and people move as quickly row from San Francisco to New York as they once moved from Philadelphia to the National Capital. From Chicago to Washington Is no more distant In time today than from Concord to Boston by foot or horse 100 years ago. Tlie radio, the airplane, the sound picture have drawn us very close together. Three times within the past 5 months has the voice of the Chief Executive of this Nation reached. In Intimate fashion. 50.000,000 eager citizen listeners in p.n instant of time. The President's far-flung appeal to the American people to co- operate with the National Recovery Administration was heard by the Nation in a single half-hour, and long before the hour was out the response began. Washington today is thronged with citizens coming, within a few hours, from the four corners of our country to apply for codes affecting their several industries; and th« malls are surcharged with voluntary agreements sent to the President by employers of labor throughout the land. Who is there so dull as not to catch a hint of drama In these signifi- cant events? The theory of our Government has not changed; but the times have changed and Invention has altered the scope and tempo of our life. I think it is hardly to be doubted that the average citizen of today senses his participation In government more acutely and more personally than he has for a generation. In very truth a Roosevelt and a radio have made a town meeting of America. It is but natural that some of the legal aspects and implica- tions of what is now going forward should di.sturb the more static members of the bar. I have had occasion to discuss th3se problems with many of my learned brethren who, while suppressing any public expression of doubt, are manifestly doing so with difficulty. Later on. all In good time. I suppose these matters will be argued out before cur courts and disposed of in orderly fashion. That hour I look forward to with a knowledge of Its certainty and vith considerable tranquility of spirit. Unusual and difficult questions undoubtedly confront us. The field of administrative law. already clouded by much uncer- tainty, is being widely extended. The functions and limitations of the various departments and agencies of government have been taking on new aspects, and the attainment of administra- tive unity in this vast complex of powers presents a fascinating problem. Nevertheless, there is no occasion to Indulge artificial fears as to the ultimate outcome. There has not been the slightest funda- mental departure from the form or nature of our Government or the established order. Our jural system remains intact. The Federal equilibrium has not been disturbed. The life, letter, and Intagrity of the Constitution have not been Impaired. Its checks and balances, its definition and division of authority, and its complete supremacy remain inviolate. The law of the land Is still the law of the land. Every new power Intrusted to the President has been conferred by the p>eople, acting through their duly elected representatives and must be and will be exercised within the letter and the spirit of the organic law. Emergency legislation Is recognized as such by the Government and will end when the emergency ends. The Congress has neither abdicated nor shirked its right or its duties; It has functioned patriotically and efficiently to meet a national crisis. What la..really happening Is not an alteration in the estab- lished form or texture of government, but a change In the spirit and application of government. Manifestly, emergency conditions do not Justify emergency the- ories of the law. It is not the duty of the Attorney General, for Instance, to attempt to make new law. but to construe and uphold the law and the Constitution as applied and interpreted by the courts. Equally It is his duty to help give practical effect to the ends sought by the recent legislation and the policies of the administration. In this effort. I shall hope to be guided by a sense of economic realism, rather than by any narrow legalism; to be helpful and constructive, rather than hypertechnlcal or reac- tionary; and to make the application and interpretation of these laws fit not only Into our established Jurlspnidcnce. but Into the new patterns of economic planning and broad statesmanship which these disturbed times dem.on a long, bitter trek, with its wastage of life and treasure — a downward, disheartened, be- wildered retreat toward lower levels of civilization and to the very v€rge of economic and finaiKlal disaster. What man of vision, or understanding, or human sympathy, could have witnessed this prolonged retrogrersion without profoimd sorrow and acute appre- hension? Tlie frantic and, for the most part, futile attempt to adjust debts, in the face of constantly falling price levels, has taken Its toll upon every hand. No one has escaped. Values have disappeared; taxes lie like a dead hand up>on enterprise; the sav- ings of years have vanished; industry is prostrated; millions are unemployed; the farming population has been reduced to penury; the nations of the world have retired into the watertight compart- ments of a narrow nationalism; commerce no longer puts to sea; and. to a disttu-blng extent, fear and aninuMlty have taken the place of common good will and common sense. Who is there who does not tirm with distaste from this dark picture to welcome the harbingers of a new day! A program of progress is already unfolding before us. It has passed the period of promise and entered the stage of fulfillment. Moreover. It is being developed tinder a leadership so inspiring that, schooled as I am In the disappointing business of politics. I feel my pulses stir and my heart leap again at the sight of America emrerging from 314 CONGRESSIONAL her dark dream. Th!« Is no time to assess responsibUlty for ou ■ present troubles In terms of narrow partisanship. This is a perio 1 oi national emergencv that engages the faith and service of ever r man woman, and child m America. The spiritual resoxxrces of th t Nation must be mobilized and the hidden reservoirs of abundanos drawn upon The artiflcial restraints that have dammed back tht flow of pra'^pentv must be released once more; that which wa i liupMnned or selftshlv guided must take Its place in an orderl r governmental process and a great cleansing and rebuUding pro- gram must go forward to its conclusion. If I mistake not. ths pet>ple of America, without respect of partisanship or previoui part; affiliation welcome this wholesome process with glad heftrb^ If, however, these emergency laws and con^ructive acts are t ) \ succeed or are to accomplish lasting good. It will not be becauas of their coercive powers or their perfections of plan and detail, or the aggressive enforcement efforts of agents and officials, but rather because they correctly Interpret, as I believe they do. ths thought and spirit, the tone and rhythm of today. Never was there such a need or such a chance for the profes- alon of the law to do creative and constructive work and rise t> lu old power and prestige. One of the most heartening feature i of our tn^ng work In Washington is the generous and helpful spirit thus far shown by the members of the bar. It has been particularly so In the work on the dlfQcult bvmtnew codes, where there is so much opportunity for the merely clever lawyer to shoi r his skill: and for the great lawyer to show his constructlVB capacity. The legal mind, I suppose, is Instiixctlvely Individualistic, anl clirnt relations probably accentuate the stress laid upon prlvats as opposed to public Interests If i^ is difficult for business t} adjust itself to emergency regulations of wages. houn>, and trad; practices. I dare say it is even more difficult for the practicln i lawyer to do so. It is neither tinnatural nor Improper to respect the paat and to be influenced by precedent, but in this dynami: hour of change it Is the new. the untried, you are called upon t3 interpret and support, and I have an abiding faith that you will d3 this with that fidelity and sincerity and that larger vision anl sense of horizons which have always characterised our profession at its best — and that you will do It. too. In that spirit of con- structive cooperation for which the necesaltles of our people as eloquently plead. POLIdXS OP THX AOimflSTRATIOR Mr. BACHMAN. Mr. President, I ask to have inserted 1 1 the Record an address delivered by my colleague [Mi. McKkllak ] last evening on the subject of the Polices of tb e Administration. The VICE PRESIDENT. Without objection, it is so or- dered. The address is as follows: My friends. It Is time for public men who love their cotintry t) speak plainly. This I ahaU try to do tonight. There are certal:i aelfiah and misguided people in this country who are seeking t} rock the boat of national recovery. They should not do so. It ii no time for the tUaplAj of selflsbness or greed. In this hour o( distress and trouble all good Americana should stand by their country and their country's leader. Wall Street, the collective name for the high financial forces cf New York CUy. has opened a battle upon the program and policies of Prealdent Roosevelt. The Issue Is sharply and clearly defined. The sole question Is whether the country wiU support the practices which wrecked our country from 1929 until 1833 or get solidly behind President Rooae - velt In an effort to save our country and restore the general proe- psrlty of aU the people. This Is the one great question before the American people toda] . It ts the death struggle between lawful and unlawful biKlnest . It la a death strtiggle between the speculators in New York Clt] . who produce nothing and who create nothing, and the great wealth-creating msMee of our people. Fortunately the entire Nation has been permitted to peek behln 1 the scenes and to see WaU Street at work. The Senate nMn^tn i^ Oommittee has certainly performed a wonderful service. I sto > here long eiwugh to take off my hat to that noble and splendi I and courageoiis Chairman of the Senate Banking Commlttm . OvifCAM U. rLXTCHxa. foT hls signal service to his country ii ferreting out and exposing the nefarious methods of these sc- ealled "financial kings." That committee has revealed the inner methods used by our discredited financial magnates. It has showi i how flnanrlal balloons are inflated and how million-dollar bub- W«s — ysa. bilUan-doUar bubbles — are blown up, shoot their ul- descent hues for a few moments In the financial air, ^i^^ theu collapse. It has shown how great financial houses In New York have allowed themselves, for the sake of huge coounlaslons. to float th e wtH^hless bonds of foreign countries among our own people, fleec- ing and robbing them for the benefit of foreign ctistocners and k few insiders here. It Is impossible to believe that any Intelllgen t man among them did not know that these bonds were compara- tively worthless when they were sold. In scmie cases, by reason o r the flnaiicial prestige of ths sellers, they fcnred sales to institu- tions which did not want them and which ■iihw.qusutlj suflerel tremetkloxis losses by reason of such piirrhnscn Their system is a system of creating fictitious prloss for so- ealled ** secumies ". which prices grotesquely cailsd ** valUM ". ar » RECORD— SENATE January 10 made by preteiKllng sales in which the left hand of the stock broker sells to its own right hand that which does not. and never did. exist, and then turns and rebujrs the same fairytale " secu- rities ", so that the public Is given the idea that an actual value exists In the paper sale. The public Is then asked to buy. and does buy, the wlU-o'-the-wisp stock, creating paper fortvines for the men who juggled the stocks and worked the deal. Get-rich -quick Walllngford, of fiction fame, was a piker beside the get-rich-quick schemes of Morgan and his layout, Kuhn-Loeb «t Co. and their lay-out. and the Mitchells, the Wigglnses, and their Uk. Not one cent of real money of any kind, to say nothing of a single gold dollar, ever figured in any part of these sielght-of- hand. fraudulent sales manipulations. The same forces and practices of the high conunand extend to the industrial concerns engaged in producing goods and employ- ing men and women. The controlling figures locked only to the sale of stocks and bonds Issued upon any given plant, basing the issues not upon the physical value of the plant or its Invested capital or its earning capacity in average normal periods, and taking the lean with the fat, but solely upon what stock manipu- laUon. assisted by ringing the market, could make the Issues appear to be worth to a gullible public. Again, bear In mind that no money of any kind — gold, sliver, or paper money — figured in any of these Inside transactions. The principal use of gold in normal times has been to employ It in shipments to foreign countries when the balance of trade has been against the United States. Gold is never used in a free- market condition except to exchange differences when and where the differences In the rate of exchange are greater than the cost of shipping gold and insuring it in transit. The vast majority of instances in which gold has been used within the last 18 years have arisen from transactions In which American money has been loaned to foreign nations and to foreign business men. While the Nation, through its Wall Street agencies, has been gambling on the prospect of maintenance of busihess in Europe, the extending of bank credits to little and large business men at home has been curtailed and oftentimes denied entirely. Because of this employment of American gold and credit abroad, credit has been shut off to the business man at home. The American business man was not, therefore, able to p>ay his employees. Men and women were thus comp>elled to Join the army of the unemployed. Eleven millions of idle people walked American streets looking for work. Bread lines were formed In almost every town In the United States. Thousands of banks were falling all over the country. Trade and commerce were at a standstill. Weak banks failed outright. Good banks were afraid to func- tion. Therefore, bank credits, the very lifeblood of a prosperous Nation, dried up, leaving a desolate economic waste in their wake. All of this was grist to the financial district of New York. Then along came Franklin Delano Roosevelt. He turned his eyes toward the bread lines, and it was his con- viction that no country could be prosperous with the great masses of the people unemployed and hungry, with no buying power. He knew that a little handful of financial people, commonly known as Wsdl Street, got the money we had loaned to Europe for the sake of commissions and largely from those very people who were now unemployed and in the bread line. He knew that Wall Street itself could not Ion? keep itself out of the bread line unless it helped to take the masses of the people from the bread line, for those in financial New York neither toil nor spin, prodtjce nor create. It was clear that the goose which laid the golden egg was dying from starvation. That was the condition which faced the President on March 4 last. He found the doors of the Nation's banks all closed and bank credits had almost completely disappeared. Red tape, legal technicality, boresome precedent, factories closed down, business failed and falling, commerce gone, men hungry and in bread lines, men walking the streets for want of work, faced our new President before he took the oath of ofllce. He exit the red tape and put the lifeblood of the Nation, credit, into motion. They cheered him in Wall Street while their own chestnuts were being pulled from the fire. When he helped to take care of their instirance companies, their banks, their mort- gage companies, they applauded him to the echo. And. now. with their own fingers unscorched, they turn on him as he labors to relieve the rest of the Nation. " Give us back the good old get-rich -quick days ", they demiand. " Let us go back to unbridled specvilation and dishonest practices ". they say. Voicing this plea, we find the leading British financiers object- ing to our reducing the value of the dollar abroad, when it is less than a year that the British Government did exactly the same thing with the English pound. And yet they would fain make us n w believe that they do not know what the President's plan of buying gold is. Echoing this criticism from London, comes France, whose franc went to less than the American nickel, to 25 percent of its pre-war value, and which now holds the whip hand In Europeen finances through the restoration of gold, and the repudiation of debts, while she owes the United States and will iK)t pay I The public gets from every known representative of the New York financial district the same deep voice, commanding " Stop 1934 CONGRESSIONAL RECORD— SENATE 315 Roosevelt." Stop him from what? Stop him from saving the legitimate business of the United States? Stop him from giving Jobs to the Jobless? Stop him from giving bread to the hungry? Stop him from restoring bank credits to the business men of the Nation? Stop him from his gold purchase policy of cheapening our dollar abroad and thereby encwxiovisly increasing the sale of our surplus products abroad? Stop him from helping the farmers? Stop him from helping those who labor and who earn their bread by the sweat of their brow? Why should any honest man want to stop him from seeking to do these necessary things? Stop him from bringing back prosperity to our desolate land, desolated by the speculators and by the dishonesty and corruption of these very people? Before the Chicago convention and at the Chicago convention we heard that cry — "Stop Roosevelt." They did not stop him then, and they cannot stop him now. The self-seeking politicians could not stop him then, and the financial people who control these politicians cannot stop him now. Financial Wall Street cannot stop him. Their puppets cannot stop him. He has set his hand to the plow to redeem our country from the ruin brought on It by that same financial crowd, and he will not turn back. Wall Street is not going to stop him. It is going to be forced to drop its selfish and short-sighted ix>llcles. the policies that brought wrack and ruin and misery to the people of this Nation 3 years ago. It is going to be forced to abandon Its attacks on the President to save Itself from financial suicide and at the same time force them to share In the returning prosperity of the American people under the wise policies of Mr. Roosevelt. And the New York financial gang, who should pay an Income tax, but don't; who make these fortunes by rigging the markets; who deceive honest people by selling them worthless foreign and domestic stocks and bonds; who, by fraudulent practices, rob the people — they know they are going to be shorn of their power under this honest President, and hence their tears, hence their denunciation of him and their pretended lack of confidence In him. They talk about Roosevelt destroying confidence! God save the mark! These very people 4 years ago destroyed all financial con- fidence, and now they are trying to put the blame on Roosevelt. Surely the people will not be misled by this shameless attempt to rig the market of confidence In their own selfish and niinous policies. Americans, choose ye today whom we shall- serve — ^the financial buccaneers of New York, the Morgans, the Kuhns, the Wigglnses. and the Mitchells, who in their own selfish greed brought ruin and desolation upon you 3 years ago, or Roosevelt, the courageous champion of the right of all the people to share In the Nation's wealth and to enjoy a greater prosperity. For me and my house and my people, I choose Roosevelt. My friends, be not deceived. President Roosevelt has furnished us with a truly great leadership in this time of distress. He Is the only one who has given us a plan of recovery. Not one of his critics has even suggested a plan. They have no plan. It Is the Roosevelt plan or chaos. WORLD CONDITIONS Mr. NORRIS. Mr. President, on last Monday night the senior Senator from Idaho [Mr, Borah] in New York City delivered a rather remarkable address, in which we are all interested. I ask unanimous consent that it may be printed in the Record. There being no objection, the address was ordered to be printed in the Record, as follows: Mr. President, the strong tendency of all revolutions is to break entirely with the past. A new world Is to be created. A new start must be made. What men have thought before Is not Important perhaps harmful. The efforts they have put forth, the sacrifices they have made, are to be regarded as without value. Traditions and policies which have become interwoven with the moral and InteUectual fiber of a people, the habits, customs, and mode of living, the Institutions they have reared at great cost of money and blood, are sought to be rejected and forever put aside. Books and symbols are btimed or in some way destroyed. This Is the revo- lutionary Idea. But, fortunately, it is never realized. Fortunately, the wealth — material, moral. Intellectual — gathered through cen- turies of effort, cannot be destroyed. No revolutionary movement can whoUy escape the Uving past. Tradition, after aU, does not yield to revolutionary decrees. Experience will have a heartng. Reflection and the Inexorable nexus of things bring men back to take up the broken threads, mend them, if possible, preserve that which is best, separate things which are fugitive from things which are permanent, and then go forward with that patient building which is the true and dependable method of permanent advancement. Washington, In his Immortal Farewell Address, said : " The great rule of conduct for us in regard to foreign nations is. In extending our commercial relations, to have with them as little political connection as possible. • • • Eiu-ope has a set of primary interests which to us have none, or a very remote, relation. Hence she must be engaged In frequent controversies, the causes of which are essentially foreign to our concerns. • • • ^^y qtilt our own to stand upon foreign ground? Why, by Interweaving oiu- destiny with that of any part of Europe, entangle our peace and prosperity in the toils of European ambition, rivalshlp, interests humor or caprice? " Thomas Jefferson stated the same principle with greater brevity, declaring: "Peace, commerce, and honest frle^dshlp with all naUons— entangling alliances with none." This policy thtis announced remained the unehaUenged and revered policy of this Nation for one hundred and twenty-odd years. Whatever differences of view may have arisen in most re- cent years, none were found, and none will be found. I venture to believe, to question the wisdom of this policy at the time it was announced or for more than a century thereafter. Without it, the Republic cotild not In all probabUity have withstood the ordeal of those formative years. It was an Indispensable part of the scheme of free government. Together with the Declaration of Independ- ence, the treaty of peace, and the Constitution of the United States, this policy made up the tiUe deeds to ovir liberty and the guaranties of our Independence. There were giants In the land In those days, men of deep Insight Into government, of profoxmd convictions, for which convlctioiM they were always willing to contend and for which they did con- tend. But in all their contentions, upon this first great announce- ment as to our foreign policy there was no division. And down through the fierce years of political warfare in which men fought with the relentless ardor of great souls over almost every con- ceivable question of sUtecraft or politics, upon this policy they were united. Behind it and for more than a century was the com- bined support and loyalty of this masterly group of men, the only body of men In all history who successfuUy organized, set up an*! maintained a real represenUtlve Republic. It was xmder this policy that we grew in strength and Influence, settled our domestic problems, brought prosperity and happiness to our own people, and won and held the respect of aU nations. Under this policy we announced the doctrine of neutrality and maintained it. We announced the Monroe Doctrine and saw to it that it was respected. In the midst of civil war we sternly re- buked those who would Interfere In our domestic affairs, and ovir position was tremendously strengthened by the policy of non- interference, which we had alwasrs unwaveringly maintained. The Influence of this Republic was felt throughout the world, not be- cause of armies or navies but rather through the force of ex- ample; we lived up to our creed — peace, commerce, and friendship with all nations. We were not hated, we were not revUed because we did not do more, and, though alone, we were not afraid. The World War brought about for the first time a wide differ- ence of opirUon touching the foreign policy of the United States. Since tha,"^ time it has been earnestly and ably contended that our foreign poiicy, so long a part of our national life, was no longer applicable to conditions broxight about by that great conflict, and that it shoud be abandoned once and for all. With this program was to go that part of International law relating to neutrality. We were to assume a position In world affairs the very reverse of that which we had held from the beginning of the Government. We were not only to accept full part and full responsibility In the adjustment of all questions of international Import — end they were practically all of that nature — which should arise In Etirope or In the Orient, but even In the remotest regioivs of the earth. We were never to assxnne the " immoral " position of neutrals. Nationalism and devotion to one's country were to be reduced to a minimum. Internationalism was to be the supreme, dominat- ing force among the peoples of the world. Like other revolutions, it sought to break with all the past. Its traditions. Its policies, and the views and teachings of Its mighty leaders. In this revolutionary movement were two distinct groups of individuals — working to the same end, but in quite different ways. There were those who sincerely believed that the new course was the high and honorable and most beneficial course to pursue. They entertained the hope. If not the belief, that the Great War had wrotigbt deep and lasting changes in the minds and hearts of the people of the world and that they were now ready to accept a wholly new theory of nationalism. It seemed to be their theory that war had brought aU peoples Into a more kindly, brotherly relationship — ^that in this awful baptism of blood peoples h%e has not changed. The tlon.• ••'•» « •»««« IndiTlduality in pmods to the product ai the most ptnUitmt and untvsrsal law at nati r« It to woven at millions of subtle and tirelaaa forces. No poirer Mn Chang* thto law or frustrate its opwatltm. Tbto to eqcuUr true with nations. Internationalism, if it means snythtng min tlMn the trtendly eooperaUon between separate, distinct lEd vboQy ladepaadant natloito, rests upon a faiss foundatlaa ire powsrs Its Up^er Orl^t. of all Eunipe 1he ott- so Ml of A^a to theln: nearnrss r in saiae years, jnimpn U of ir- 2 diir nerer neitr- of tbemsel^ies. Japanc se, wot lid ILOt tils leaders tJiat civ II- all not wth iiot of ancltot bell( fa. liad It dnd January 10 and bu- of Its irs of when undertaken. It will f aU as In the name of progre manlty It should fall. Out yonder In the sad bean fields of Manchuria, empty formula met reality. Intematlonaltom encountered nationalism, and the pathetic results are recorded in the great disappointment of many wise men. In an old Greek tragedy you will find this line: "Alas! How dreadful to have wisdom where It profits not the wise." Nationalism, pride, and love of country to a passion peculiar to no people. Indispensable to the welfare of all. To undertake Its destruction to madness. To foster It, cultivate It, direct Its finer qualities along high and honorable and peaceful lines, as exemplified In the precepts and examples of Washington. Jeffer- son. Jackson, and Lincoln, with countless others whose names will readily come Into yoxir thoughts. Is the highest mission, the noblest calling. In which men and women assoctoted with public affairs can engage and to which a free people can devote their alms and consecrate their energies. Its maintenance has cost blood. So has religion. It has en- tailed suffering beyond the power of words to paint. So have all the creeds and faiths of men. But it Is worth all It has cost. Ask the Poltoh pec^e. taking a single instance from the crowded pages of history. Frederick the Great, in his old age. writing to Voltaire, said: "Now that Poland has been settled with a little Ink and pen. the ' Encyclopedie ' cannot declaim against merce- nary brigands." But Poland had not been settled by a little ink and a pen. Physically dismembered, her national spirit lived on. Homeless, as it were, it appeared upon every battlefield for liberty and fought for the oppressed in every land under the heavens. Without a country of Its own. this Polish spirit of na- tionalism made the land of the downtrodden among all peoples its home. When the World War came, near 200 years had intervened since the crime was committed. But there was no stronger feel- ing of nationalism anywhere to be found than in thto dismembered country. And like a ghost of retribution, It pursued those who had Inflicted what was supposed to be a mortal wound to their utter undoing. Shall we hope to achieve for the world what the despoilers sought to do with Poland? Even though we employ oceans of Ink and millions of pens, our effort will be just as futile as was theirs. War may spread its ruin, you may wreck the fundamental law and uproot the Institutions of your coun- try— these are but the fruits of man's efforts. But a higher power has planted In the human breast devotion to country. and all permanent progress must rest upon that basic fact. With these Intimations as to my views, here I might stop. But the subject assigned to me by your spokesman calto for a more specific word. Our Foreign Policy In a Natlonaltotlc World was the topic assigned to me for this evening. It to a natlonaltotlc world. Intensely so. There can be no doubt about that. Everywhere the national spirit Is evoked, fostefed. and religiously maintained. Whatever we may think as to some of Its policies and tendencies we must admit that under its weld- ing, cementing, driving power different peoples have been lifted Into a region of exertion and consecration nothing less than amazing. In countries where there was debility. Incompetency, and utter demoralization among the masses there Is now strength and vigor and hope. Trampling imder foot the false and feeble philosophy which would disparage the healing, uplifting p>ower of patriotism they sacrifice, suffer, and endure, and find their highest compensation In the increasing vigor, prestige, and honor of their country. These conditions and these sentiments are not likely to undergo a change In the near future. If a foreign policy should be offered to these nationalistic nations which would not fit into, serve, and augment their nationalism, It would be rejected. Such a policy was offered to Japan. It was rejected. Where would a foreign policy based upon International- ism find reception In Btirope or In the Orient? Like the dove from the Ark. there would be no place for it to light. When the security committee of the League several years ago sought of Great Britain her views upon the terms of the Covenant the com- mittee was plainly Informed that Great Britain would determine for herself whether there was a breach in the Covenant and would determine for herself what. If any, action she would take In regard to It If a breach should occur. Who would expect Great Britain to do anything different? And who would long respect her If she did do anything dlCerent? The Invasion of the Ruhr. Corfu, the seizure of Manchuria, these things indicate rather strongly that all schemes of international cooperation must fit into national realization. Judging the future by the past. It will always be so. Eiu-ope has not changed In thto respect; and I venture to say. In the Interest of civilization. It to well that she has not changed. Europe, with her developing nationalism, may throw many dark shadows upon the future. But Eiu-ope, without the national ^Irit. woiild be hopeless beyond redemption. Nation- alism doea not neceasaxtly of itself mean militarism or war. as shown by our own htotory. But anything to preferable to suffo- cation In the fetid atmosphere of national decay. National decay begins where nationalism ends. I am far more concerned about our domestic problems than X y about our foreign affairs, although otir foreign policy will greatly help or binder the Nation in dealing with our domestic problems. It will be a long time, I venture to believe, before there will be any necessity or Justification for the United Sutes engag- ing in a foreign war. But the questions at home are Imminent; ttey are upon us. not only those which have to do with the de- pression, but many which are even of a graver and more perma- nent nature, problems which have their roots deep down In otir whole social and political structure. I could not g«t my consent, and you would not expect a discussion of these at thto time. It 1934 CONGRESSIONAL RECORD— SENATE 817 I J Is Bufflclent for the purposes of the evening to merely indicate some oi them. Our stupendous debt burden, public and private, some $220,000,000,000: our constantly Increasing tax burden, city, county, State, and national; the chronic waste of public money; the utilities problem: conservation and proper use of our natural resources: the banking question; the money problem; the more equitable distribution of wealth — these and many more problems push for consideration. No scheme on earth can give us perma- nent contentment or permanent prosperity until they are solved. Indeed they were contributing causes of the depression. The guaranty of our national efficiency, prestige, and strength, notwithstanding the many problems with which we must deal, of that political liberty, that freedom from oppression, which Is to be found not alone In vrlse leaders but even more In a united and a wise people — united not only by constitutional forms and one flag but united in spirit and exaltation of purpose. After all, the source of power under our Government is the people. If at that source there Is wanting poise and Judgment, devotion and wisdom, this will inevitably be reflected in unstable policies and unwise laws: the people " mxist nobly save or meanly lose the last best hope of earth." Our foreign policy, therefore, should be one best calculated to unite our own people morally, spiritually, and economically, to Inspire them with a sense of national fidelity and personal responsibility. This country has within her boundary people from almost every land under the sun, still conscious under certain conditions of the " mystic chords of memory." Every civilization has made its con- tribution to the American civilization. Kow easily to transfer the racial antipathies and political views and controversies of the Old World into our very midst. Once abandon our policy of aloofness from European controversies and we bring these controversies Into American neighborhoods and into our national life. We are con- stantly warned how persistently that transfer takes place. Only recently the bitterness, the intensity, of a European controversy nerved the arm and guided the hand which grasped the dagger of the assassin not only in our very midst but \uider the most sacred and solemn surroundings. Eschewing policies which tend to keep alive former attachments and the political controversies of the Old World, we should exert to our utmost the healing, cementing p)ower of patriotism and mold 120.000,000 people into an invincible. Intellectual, economic, and political force for the enactment and administration of just and equal laws. In the Immediate years, believing that I was laying the founda- tion for the adjustment of all our problems, believing that I was engaged In not only saving government but in saving souls, not only preserving institutions but preserving human liberty, like Peter the Hermit, with his tongue of flre, I would preach united national alms and ideals, I would instill anew the great truth that democratic institutions are the only hope for the personal worth, the dignity, and individual liberty of the citizen. I would frame all laws and shape all policies with these great ends in view. In no other way can be hope for contentment and power at home or respect and influence abroad. In concliision, permit me to say that I believe in the foreign policy which offers peace to all nations, trade and commerce with all nations, honest friendship with all nations, political commit- ments, express or implied, with none — the policy which not only in fact respects the rights and sovereignties of other states and nations without distinction of great and small, and particularly upon this continent, but which would also refrain from words or acts that would seem to challenge those rights. Under the shelter and the inspiration of such a foreign policy I would foster and strengthen that brand of Americanism which believes in the worth, efficiency, and grandeiu- of constitutional democracy, in the vigilant preservation of the personal liberty and the Indi- vidual privileges of the citizen, realizing that our Institutions and the whole vast scheme of democratic government depend upon our ability to harmonize the rapacious economic forces of the modern world with the political freedom and economic rights of the Individual. Thus, armed with a sense of justice toward other nations on the one hand and a sense of duty toward pur own people on the other, this Nation will remain at peace with all nations who want peace, and If there be those, who do not, and will not. have peace, we will tinder such circumstances need have no fear. Ur. President, there is no creed or faith, no political principle or form of govemment, but must at some time or other imdergo attacks, and this seem* to be one of the iieriods of challenge and general aaaallment. We read of a movement lately initiated In one of the leading countries of Kuropt to delete the Ten Com- mandmenta. presumably that part which says: " Thou sbalt not kill "; edit the Lord'a prayer, since that perfect supplication encompasses all men regardless of race or creed; abolish Christi- anity, and conform the teachings of the Nazarene to the practices and principles of their political leader. This wicked and blas- phemous exhibition of diseased minds seems only a little more impious and no less vain and impotent than the persistent attacks everywhere encountered upon popular government, the right and capacity of the people to direct and manage their own political affairs. Here and elsewhere, either by those who in their own land have destroyed the last vestige of personal liberty, sending to prison and to the tortiu-e chamber men and women because of race, religion, or political opinions and sacrificing all rights of the people to the gratification of personal power, or by those in our own land who consult appearances rather than realities and mistake surface indications for the deep currents which move below, is heard the solemn pronouncement that popular gorem* ment has failed and constitutional democracy is dead. We need not be dismayed but we cannot be unconcerned. The right to worship according to the dictates of one's oonsdence. tha right to freedom from persecution on account of race, are parts of that political liberty, that freedom from oppression, which Is the Itfeblood of democracy. These things, together with fres speech, a free press, the right of assemblage, and those guaranties. the sum total of which make up the inestimable blsssipgi of personal liberty, are the things for which democracy stands. They are the things for which we stand. And I venture to believe that we will not fall to preserve them. Looking backward and lookinf forward, proud of our past and confident of our future, we sbaii find our highest service not only to our own but to mankind and to the peace of the world in transmitting these principles unim- paired to succeeding generations. This Is our supreme duty. Z believe that the foreign policy of Washington and Jefferson and Lincoln will best enable us to meet and discharge that duty. I am, therefore, at all times. In periods of turbulence and in periods of calm, and without apology and without compromise, committed to its support. . This, it wlU be said, is Isolation. It is not isolation, it U freedom of action. It is Independence of judgment. It is not isolation. It is free government; there can be no such thing as free government If the people thereof are not free to remain aloof or to take part in foreign wars. People who have bartered away or sur- rendered their right to remain neutral !n war have surrendered their right to govern. In matters of trade and commerce we have never been Isolationists and never will be. In matters of finance, unfortunately, we have not been Isolationists, and probably never will be. When earthquake and famine, or whatever brings human suffering, visit any part of the human race, we have not been iso- lationists, and never will be. In all those matters and things in which a free and Independent and enlightened people may have a part, looking toward amity, toward peace, and the lessening of human suffering, we have never been isolationists, and never will be. But in all matters political, in all commitments of any nature or kind, which encroach in the slightest upon the free and unem- barrassed action of our people, or which circumscribe their dis- cretion and judgment, we have been free, we have been isola- tionists. And this. I trust, we shall ever be. If there be any truth established by the experience of nations. It is this: That to accommodate your foreign f>ollcles to the demands or In ths Interest of other nations at the peril of your own security is to invite contempt, and It seldom falls to earn a more substantial punishment. In recent years much has been said, esi>eclally from abroad, about the provincial American. Those who discuss this and kin- dred matters modestly pay tribute to their own worth by speaking of world vision and of a wider human 83rmpathy. One need hardly linger to discuss the subject. Regardless of what may be said by those whose purposes are apparent, let us hold fast to those politi- cal principles and foreign pKilicles which others call provincialism, but which we call Americanism. It has served mm well. It fits in with our scheme of democracy. It has built a civilization whose . capstone is personal liberty. It may have Its faults, as what earthly scheme has not. But all the world will have to testify tnat In great emergencies. In sublime moments, when civilization hangs in the balance. It Is wanting neither in sympathy nor courage, and whatever faults It may possess are burled In the depth of a great unselfish and heroic purpose. It has no taste nor aptitude for the hazardous enterprise of uncovering aggressors or chastising na- tional renegades. Here in its Ood-ordained home between two oceans, watchful of its own Interests and vigilant in the defense of Its rights, it covets nothing of others save the peace and friend- ship of all. It does not, and it never has, shrunk from its duty to civilization. It will not disown any obligation which human lib- erty and human Jxistlce impose upon a free people. But it does propose. I venture to prophesy, to determine for Itself when civil- ization is threatened, When there ma^ be a breach of human rights and human liberty sufficient to warrant action, and it proposes also to determine tooitfXJMn rawTOun Mi. DICKINSON. Mr. President, I haye before me an address by Chester H. Oray, Washington representative of the American Farm Bureau Federation, on the subject of the NHJL Prom the Parmer-Consumer Viewpoint, presented at NH^ public bearlnf at United States Chamber of Com- merce Building. Washington, D.C., January 10. 1934, which I ask permission to have Inserted In the Racot». There being no objection, the address was ordered to be printed in the Rjecoid. as follows: As indicated by spokesmen for this organicatton at the time at the enactment of the National Beoorery Act. we gravely feared that the effect of this act. originated, developed, and enacted almost overnight, would be to offset and. la Urge part, negative the anticipated benefits to agriculture expected under the Agricul- tural Adjustment Act. This latter act is one long oontemplAted and advocated by tann- ers and many business leaders; was based on a fundamental eeo- nomic condition of long standing and ftiUy recogniasd by sereral , 318 CONGRESSIONAL RECORD— SENATE Ctmzrmam, and had bcm nuule one of the Important planka In the platform and the 8p«-che« ot the candidate ot the party now In ^wJ therefore vlew«d with grcmt ml3glvln(?« the overnight and Beoeasarlly hastUy con.*idered National Recovery Act. with Itabroad powers and fuU abllltf to set a«lde and cancel aU the beneflta of the legislation which the farm forces had bo long and laborloualy We recogr.lwd. how-ver. that the method of admlnlateiing the national Recovery Act and the atUtude of the Administrators would be the all-important determining factor aa to whether or not our worst fears wcuM be realized. Wp heartily commended the principle of abolishing child labor •nd favored the principle of spreading the available work among a greater number of workers. •«> recognized the need for Increased wazc«i in ciertaln Industries where wage competition had forced the level down to an extraordinary degree. But a-e al50 recocnzed th:it the N.R.A. opened the door of opportunity to business and labor to do tlie things which they have tried ifor years tc do. bui were restrained from doing, either by reason oi the antitrust laws or by their inability to persuade Congress to grant them further privileges of restriction or com pulsion. V.0 rrcogruKd furth«T that the consumer, being for the most part Inarticulate, would In the natural course ot events be the victim The time has come to assay the results of the operation of the N.RA. to date and to cietemun'; whether or not our fears are being realised. We present herewith a table giving the latest ofBcial figures pre- pared by the United States C-epartnT^'nt of Agriculture, showing the monthly Index of ])rlces received l-Jul7 1»14»100| MOBtil Janoary ............ Ttbrtuty. „ ....>. . M«rch....I April May inat ~. *oly Aucoat Septembsr October NoTwaber ..._... n PikM iMeivtd by funen n « 50 B «2 M W n to T Tl Prteas by for thiocs boaclit m lU in 101 MB m 107 U3 U« IM 117 118 Indn of farm crops' purchas- ing power (0 40 to £3 ei aa n 04 60 00 61 67.1 It Will be noted thjit It also happens, by a curious coincidence that In liareh of the past year. 1933. the Index of prices th« tarmcr had to pay for the commodities he buys stood at exactl] 100. By a further coincidence, the Index of prices the farmei i«celv«d stood for the same month of March at 60. In otbei voris, the purchasing power of the farmers' crops was Just 60 per cent at what it was in the pre-war baiw period. It was tor the pturpose of correcting this very discrepancy, i discrepancy of long standing, that the Agricultural Adjustmeni Act was perfected by Congrees last March and April and finall] •Isned by Prealdent Roosevelt last May. How. note what has happened since March I The tanner^ price rose rather rapidly throvich April. May. June and July — too npldly, as it proved — jumping from an index of H In March to 76 in July. The prices paid by farmers rose onli slightly, from 100 to 107, and the farmers' purchasing-power indei went up to 71 percent of pre-war normal. Things were Icxiklng up on the farm. The Agricultural Adjust- ment Act was apparently working as expected. "n^n note what happened I About the cod of July the VILA., codes began to get In theli Influence. Only a few had been actually adopted by that Ume but the very fact that Industries had organised and antldpatec higher prices had the effect of rapidly increasing the prices cr. industrial producu. We know of several Instances where manu facturers. stcure in t^te beUef that the adopUon of their coda would bring much higher prices, proceeded at once and wlthoui waiting for the adoption of their code to agree to raise prleei sharply. At any rate, prices of ouuiafacttured commodities did rise rapldl] •nd steadily, and on December IS. the last date for which Oovem rat figures arc aTalliible, the oompoalte Indes for thin^i th4 buys had reached 119. Lumber and certain other building materials dottbled or ma» ttian doubled In price. Data published In the "*<*■"*«•' 28 num ber of the Oonsiijners* Qulde. iasiwrti by the Consunksn' Oounsc portunity for lasting service to the States and the people of the West through his pMitlons upon the Public Lands Committee, the Agricultural Committee, and the Plnanoe Committee. It was Senator Hansbrough who fathered the cause of Irriga- tion which today u accepted as being quite a matter-of-fact thing, but which, in his day, required unending and unoompro- mlslng battle to win. Close at our hand today stands the beautiful Congressional Library which was first occupied during our departed friend's chairmanship of the Joint Library Committee of Oongreas. Be also served for many years upon the District of Columbia Com- mittee and contributed largely to the building of this very beau- tiful Capitol City. The deceased was married in 1879 to Josephine E. Orr who died January 14, 1896. A few years later he married Mary Berri Chap- man, of Washington, who survives him. Truly oiu- friend saw a great deal of this life. That he enjoyed life every friend can attest. This enjoyment continued to the end except that it was easily seen that he was counting himself, of later years, thoroughly spent and ready for his grave. While he enjoyed much of life, there were, in his declining years, those disappointments and discouragements which could not do other than dampen his spirit, and on his last day, realizing that the end was near, he is found whispering to his dear friend the words: "Death is sweet; I hope it comes soon." His State, his Nation, and its people owe Henry Clay Hans- brough a debt of gratitude. He served falthftilly and well when- ever his services were Invited, and now we find this most demo- cratic of democratic spirits In the democracy of the dead where, as another has put it: "There is neither rank nor station nor prerogative in the republic of the grave. At this fatal threshold the philosopher ceases to be wise, and the song of the poet is silent. Dives re- linquishes his millions and Lazio-us his rags. The poor man Is as rich aa the richest, and the rich man Is as poor as the pauper. The creditor loses his iisury, and the debtor is acquitted of his obligation. There the proud man surrenders his dignities, the politician his honors, the worldling his pleastires; the InvaUd needs no physician, and the laborer rests from unrequited toil. " Here at last is nature's final decree in eqtiity. The wrongs of time are redressed. Injustice is expiated, the Irony of fate Is refuted: the imequal distribution of wealth, honor, capacity, pleasure, and opportunity, which makes life such a cruel and inexplicable tragedy, ceases in the realm of death. The strongest there has no supremacy, and the weakest needs no defence. The mightiest captain succumbd to that InTlncible adversary, who disarms alike the victor and the vanqtiished." And thus Henry Clay Hansbrough wotild have it! To the de- mocracy of the dead he moved willingly after Ulness of only a week, and without a trace of bitterness toward life or fellow man. WILLIAM B. irSLSOll CALLXtT OF ART Mr. CAPPER. Mr. President, in Kansas City this last fall was opened the William Rockhill Nelson Gallery of Art and Atkins Museum, a wonderful monument to one of the great builders of Middle West. But great as that monumental gallery is, the greater monuir»ent to William Rockhill Nelson is the impress he, through his great newspaper, the Kansas City Star, made and left on the community and community life of which Kansas City is the center. I ask unanimous consent to insert in the Rbcoro. as part of my remarks, the following well-deserved tribute from those who worked with Colonel Nelson, which appeared in the Kansas City Star of December 10, 1933. There being on objection, the editorial was ordered to be printed in the Rbcoro. as follows: [Prom the Kansas City Star, Dec. 10. 1938] Ir Thou Snoc His Mowuiciirr — The name of William RockhUl Nelson blazes over Kansas City this week. But in centering attention on the art collection and the shining gallery that bear his name, we may overlook the wider contribution that its foremost citizen bestowed on the city of his heart. ^ ^ That contribution came from his instinctlTe love of the beauti- ful in all its forms. The art collection was merely one direction in which his love gorgeously fiowered. When this bulky, middle-aged man stormed Into Kansas City la the summer of 1880, he foimd a vigorous town absorbed in the business of making a living. stUl dominated by the frontier tradi- tions of the trading center which has outfitted expeditions for the Santa Fe and Oregon Trails into the great western adventure. It had energy, elan, but It was conspicuously deficient In sweet- bees and light. lU people had come largely from the country or small towns. Many of them expected to moke their pile and move on. They were not concerned with stich refinements of civilization as garbage systems, paved streeU, architecture, pic- tures. . w . .* Into this Incongruous environment plunged a man who in spite of his Kngitwh ancestry was essentlaUy a Latin in his feeUng for ^fitiA rTr«n/M>rk ennxT a mw 001 Mu* pnocs on mjuiy ai-udes increaMd rrom 60 to 144 percen < vo nave prmi«a m ine kecord a memorial aaoress aeuverea S20 CONGRESSIONAI RECORD— SENATE order, beauty, and splmdor— a Lorenro the Magnificent, with dash of Jim Hill the builder and Oliver Cromwell the rebel. aSMOI-OING THIS SOaST SCHXKUI In later ye^rs Nelaon used to say it was sheer aelflshneas tl^* drove him to his never-ending campaign to make the sprawlhig frontier vlllasre Icto a modem city. • I was going Ui live here, waant I? Well, Kansas Ctty had be made into a place that somebody besides a few dollar s— "" would want to live in. By Ood. it was a groundhog case. It was sometliing more than that. Nelson could no more trying to shatter this sorry scheme of things in order to It nearer to the heart's desire than he could help breathing wa» restlessness Incarnate. He was forever driven by an demon to smaah and build. And his building was directed the fact that he belonged essentially to the civilization of rather than to the ctvil.zatlon of the machine age. " Dont talk to me about a campcdgn to bring a lot of cho ,p labor to Kansas City to make cotton prints ". he once exclaimed to a delegation of town boosters. " Put on a campaign for an gallery and I'm with you." swappe rs he p remo d _ lie innsr by beau.y CITT TO uvs n» A contractor, builder, political manager, and small town edil^ ot Fort Wayne. lad., he threw all his lmm*tn.wt energy into tie new^Mper that lie eBtiU>ll8hed. It was courageous, outspok^ above all hviman. He wanted to use It as a driving force for better city. But It wiis to print fine and interesting readiiig matter. " Dont forget '. he told his editors. " that Plato. Shakes- peare. Macau lay. Huxley, wrote almost as good stuff aa some 3f our modems. I never pick up a standard book without finding an interesting passage. Let's pass aoma of those things on |bo our readers." In such a detail as typography he painstakingly picked out handsome dreas for his paper that proved so adequate that the first page of the Star of December 10. 1933, is the lineal qe- acendant of the first page of the Star oi September 18. 1880. At first his efforts wt^re directed toward the fundamentals bf a decent place to live in. The city was in the mud. It must ye paved. It had W(X>den sidewalks. They must be made of per manent material. Garbiige was dumped In vacant lots. It must be collected and dispofied of. There were no shaded street. Tnea must be planted There were no public baths. Thsy must be obtained. There was no public hall. The "tightwadii must be shaken down and made to build one. There were iio parks and boulevards. They must be provided. The city built with checkerboard streets and commonplace houaes. ^e would set an example fee city planning and architecture in 1 Is own home and in the RtKkhlll district, with its winding. shadKl roads, its dry stone walls covered with rambler roses and hone f- suckles. Its attractive small houses. The county was disflgiir >d with ** tin " bridges. He would build a double-vch stone brid|;e to show what should be done. TUX KUaOPEAM AOVXNTUKB But through most of this crusading period Nelson had nbt really found himself. He had not conscioualy discovered lis allegiance to the world of beauty. This realization developed as A result of two years spent in Europe for the education of l^is daughter In the nineties. While he traveled widely, his heart responded to the appeal of the magnlflcenoe of Paris and the loveliness of Italy. No one knowing Nelson can stand before the glorious Palazzo VeccI io In Florence without feeling the spiritual kinship between tl ils modem spirit and the splendor that fiamed in the soul of t tie Lorenzo who founded the Uflial gallery and made the dty on ^e Amo the cultural capital of Kurt^>e. Prom this experience abroad fiowed back the copies of gr^^at paintings that were to constitute the Western CNdlery of Art, 1 be forerunner of the new gallery. Nelsixi had come to love the paii kt ings In the European collections. U his fellow townsmen coiild not see the originals, he was determined they should share his Joy through seeing the best copies obtainable. His own manner of living showed the effects of the foreipi influence. He built over his house In the m>irit of an old Engl sh manor. He picked up original paintings for It aa opportun ty offered. He instructed a member of his staff to have a catalog ue Blade of his books and see that any important gaps were fill >d He wanted what he called ** a gentleman's lll»«ry." On a visit to Oak Hill, Theodore Roosevelt, looking over his books, inquired or the Or^A poets, and found them. " The Oreek poets are aim Mt a distinguishing mark of a gentleman's library ". was Rooaeveft's comment, to his host's delight. DAXLT W. R. HXLaOir Dully sumned he ed of The Star he used as the vehicle to convey his ideas into Utersjlly •very home in Kansas City twice a day. In many respects, oooe obMTved. his newspapCT desored the name of " The W. R. Nelson. " Twenty years ago an editorial in the Star up humorously the reaiction of objectors to the steady stream •dvtoe that was poured over the city: " Under the malign direction of Neiaon the Star has kept eonstantly stirred up. It has made tenanta dlaaatlafied. nev«r uaed to complain about light and air. Now they wont at a bo«M uatoss every window opens on a flowvr gardui wltl humming bird in it. The Star won't let anybody alone. It ■lato oa rwgnlaMng the mtnutaat detail of people'a Uvea. Its re^ latlons an pamldoaa and extravagant. Its preaching about m ire parka and bomlevards and breathing qiacea and •upcrvised pli^y thhigB Tliey Iciok a n- January 10 grounds for children, and plant Dorothy Pertlns roses, and swat the fly. and housing reform, and a new charter, and art galleries, and keep your lawn trimmed, and take a lot of baths, and throw out the bosses, and use the river, and cut the weeds on vacant lots, ^nri read the Home University Library, and for God's sake dont build such ugly houses, and make the landlord cut a window in the bathroom, and put goats In Swope Park, and why will mothers risk their babies' lives by bringing them up on bottles, and plant your bulbs now, and teach your children manners, and what's the use of lawyers, and cviltlvate a pleasant speaking voice, and build a civic center, and put out houses for the birds, and walk 2 miles before breakfast, and why are Piollman cars so hot in winter, and go to church, and cut out the children's adenoids, and build trafflcways, and sleep with your windows open, and the square deal, and build cyclone-proof houses, and smash the saloons, and pooh, pooh on factories that employ women, and reduce street-car fares, and go look at old masters every Sunday, and uae 2 by 6'8 instead of 2 by 4 's If you want your house to stand up, and move out in the suburbs, and tear down the tin bridges, and build hard- surface roads everywhere, and all the other things, has increased the cost of living and given people inflated ideas, and pretty nearly ruined the town." Gradually these admonitions for civilized living had their effect. The city became beauty conscious and took on its present aspects. LOOK ABOXrr THBB The ruling passion of Nelson's life was embodied in the wTHs m which he and his family left their fortune to the art collection and the gallery that housed It. His entire estate, he provided, eventu- ally should be gathered In the William Rockhlll Nelson Trust and " the net Income thereof used and expended for the purchase of works and the reproduction of works of the fine arts, such as paintings, engravings, sculpture, tapestries, and rare books, the ptnTXDse being to procure In this manner works or the reproduc- tions of works of the fine arts which will contribute to the delecta- tion and enjoyment of the public generally, but are not usually provided for by public fund." As one looks out over the wide expanse of the city from the south porch of the gallery of art there comes to mind the famous inscription on the tomb in St. Paul's Cathedral, London, of its architect. Sir Christopher Wren : " SI monumentum requlrls clr- cumsplce " — " If thou seek his monument, look about thee." So Nelson built his own far-flung moniunent. GOVkRimENTAL EXPENDXTORES Mr. ROBINSON of Indiana. Mr. President, in the Presi- dent's Budget message of last week it was suggested that an Executive order had been issued placing all expendi- tures, emergency as well as normal, under the direction of one department. I desire to quote now, in connection with that order, from the Baltimore Sun of this morning, an article written by Prank R. Kent, indicating that the order has already been canceled. Mr. Kent's article is as follows: Those who, shocked by the size of the deficit and debt figures revealed by the President Isist week, took comfort from his order placing control of all emergency expenditures under the Director of the Budget, Mr. Lewis W. Douglas, must feel as if the ground had been cut from under them this morning. That order was hailed all over the country as gratifying evi- dence oi the President's purpose really to balance the Budget in 1930. The expenditure of billions for recovery is essential, but the placing of a ctu-b upon the spenders was eqiially essential. Up to date there has been neither audit nor control. The money has been poured out at the will of the spending directors. The White House order was seen as the one way in which the huge financial risk the new deal involves could be minimized. It was the safety device on a high-speed machine. The President, It was generally agreed, had acted wisely. But in 3 days the President changed his mind and the order Is rescinded. The announcement from Washington said that the order had been " modified ", but that word is misleading. It merely camoufiages the fact. The former status of unrestricted expenditures is restored. The various directors are required to make weekly reports to the Budget Director and be may make recommendations to the President. That, however, means ex- actly nothing. The Department directors report to the Budgst Director after, not before, they make the expenditures, and he has no power over them. Anybody can find out what the ex- penditures are after they have been made. That knowledge is then public property. Newspaper men will know them before the Budget Dlrectcw gets the reports. As for reconunendaiions to the President, Mr. Douglas could make thoee recommendations, anyhow. And what do a Budget Director's recommendations that too much money is being spent unwisely amount to alter it Is spent? All they will do Is get him Into a losing argument with the men who did the spending. That It would be a losing argument Is proved by the fact that Mr. Douglas has made It a number of times already and lost every time. The rescinding of the order Is the best proof of aU. What happened in that case was this: Mr. Roosevelt, after laying before Congress and the country a financial program In- volving tremendous outlay, unprecedented borrowing, and a deficit and debt beyond the most pessimistic forecasts, proclaimed a con- servative policy by which, if prosperity fully returns, the national solvency can be regained in 1936. To this end, he announced that 1934 CONGRESSIONAL RECORD— SENATE 321 the heretofore unaudited and uncontrolled emergency expendi- tures would be subjected to approval of the Budget Director. It was the logical, safe thing to do. But It didn't suit the gentlemen who are spending the money. As soon as the order came out, Mr. Ickes. Mr. Hopkins, and Professor TugweU. who. it Is reported, will soon be made Under Secretary of Agriculture, went to bat. They pointed out that control by Mr. Douglas would " slow down " the program; that It meant the money could not be put out fast enough; that It would hamstring their plans. Among them, they swung the President back, and Mr. Douglas was notified over the telephone that the order was annuUed and he need not bother. He is Just where he was. except that he can. if he likes, read weekly reports from the directors as to the money they spent. To do this would seem to give him needless pain. Mr. Douglas, loyal as anyone to the President, is recognized as a conservative — a man who likee to have solid ground under his feet. For a long time his attitude has annoyed the young liberals, with whom he has clashed frequently. The prompt cancelation of the proposal to make his job a real one naturally rejoices them. The report is that when notified the order had been rescinded Mr. Douglas acquiesced. What else could he do? It is e^lalned that the President's order still stands so far as having the expenditures pass under the eagle eye of the Comp- troller General. Mr. McCarl. But Mr. McCarl has no power except to see that the expenditures are not made Illegally. That does not mean a thing. The plain fact is that half a dozen different men here are spending huge sums without any real restriction or super- vision. The President, like a good many others, recognized that there should be one supervising ofQclal. able to call a halt. He named such an official on Thxirsday and then canceled the designa- tion Monday. It was. Indeed, a Liberal victory. TAXATZON or INTOXICATING LIQUORS The VICE PRESIDENT. The morning business is closed. The calendar under rule vm is In order. Mr. HARRISON. Mr. President, I move that the Senate proceed to the consideration of the biU (H.R. 6131) to raise revenue by taxing certain intoxicating liquors, and for other purposes. Mr. McNARY. Mr. President, may the motion be stated by the Chair? The VICE PRESIDENT. The motion Is that the Senate proceed to the consideration of House bill 6131. Mr. McNARY. I should like to have an understanding with the Senator from Mississippi [Mr. Harrison] and the Senator from Arkansas [Mr. Robinson] that at the con- clusion of the consideration of the measure referred to in the motion of the Senator from Mississippi the Senate will recur to the calendar, because a number of Senators are interested in bills on the calendar. Mr. HARRISON. May I say to the Senator that I do not think this legislation will take very long. There are not many controversial matters, if any, and I think we can ex];)edite It. I am very anxious to get the biU out of the way today. Mr. McNARY. I appreciate that: but I should like to have the understanding to which I have referred. Mr. ROBINSON of Arkansas. Mr. President, I ask unani- mous consent that at the conclusion of the consideration of the bill mentioned, the Senate proceed to the considera- tion of unobjected bills on the calendar. The VICE PRESIDENT. Is there objection? The Chair hears none, and it Is so ordered. Mr. McNARY. I thank the Senator from Arkansas. Hie VICE PRESIDENT. The question is on the motion of the Senator from Mississippi. The motion was agreed to; and the Senate proceeded to consider the bill (HJl. 6131) to raise revenue by taxing cer- tain Intoxicating liquors, and for other purposes, which had been reported from the Ccmunittee on Finance, with amend- ments. The VICE PRESIDENT. The clerk will read the bill. The Chief Clerk proceeded to read the bill. The first amendment of the Committee on Finance was, on page 1, line 4, after the word "This", to strike out " title " and insert "act ", so as to read: TnxE I Section 1. This act may be cited as the " Liquor Taxing Act of 1934." The amendment was agreed to. The Chief Clerk resumed the reading of the bill and read as follows: Sac. 3. Paragraphs (S) and (4) of snbdlvlalon (a) of section 600 of the Revenue Act of 1918, as amended (relating to the tax on distiUed spirits generally and the tax on distUled spirits diverted for beverage purposes) (UJB.C, sup. VI. title 26, sec. 1160 (a) (1) and (2) |, are amended to read as foUdw*: "(3) On and after January 1, 1928, and until the effeetlv* data of tiUe I of the Liquor Taxing Act of 1934. tl.lO on each proof gallon or vrine gallon when below proof and a proportionate tax at a like rate on all fractional parts of 'such proof or wine gallon: and "(4) On and after the effective date of title I at tba Liquor Taxing Act of 1934. $2 on each proof gallon or wine gallon when below proof and a proportionate tax at a like rate on all frac- tional parts of such proof or wine gaUon." Sec. 3. Subdivision (c) of section 000 of the Revenue Act of 1918 (relating to the internal-revenue tax on imported perfumes containing distilled spirits) [U£.C., sup. VI. title 26, sec. 1150 (a) (4)1, is amended by striking out " $1.10 per wine ^Uon" and Inserting in Ueu thraeof " $2 per wine gaUon." Sac. 4. In lieu of the rate of drawback provided in section 3329 of the Bevtsed SUtutes, as amended IU.S.C.. sup. VI, title 26, sec. 1239], the rate of drawback aUowed \xoon the exportation of distilled spirits exported on or after the effective date of this title shall be equal to the rate of the Internal-revenue tax paid in respect of the dlstUled spirits exported hut shall not exceed a rate of $2 per proof gaUon. Sec. 6. Section 3309 of the Revised Statutes, as amended (re- lating to the tax on deficiencies In dlatUled spirits production lUB.C. sup. VI. tiUe 26. sec. 1197). Is amended by striking out " at the rate of $1.10 " wherever such phrase appears axMl In- serting in lieu thereof "at the rate of tax Impneed by law." Sec. 6. So much of section 611 of the Revenue Act of 1918. as amended (relating to the tax on still wines) (UA.C., mip. VI. tltls 26. aeb. 1300 (a) (1)], as reads: " On wines containing not more than 14 peroant at abaoluts alcohol, 4 cents per wine gallon, the percent of alcohol taxable under this section to be reckoned by volxune and not by weight: " On wines containing more than 14 percent and not exoeedlag 21 percent of absolute alcohol, 10 oents per wine gallon; " On wines containing more than 21 percent and not exoeed- ing 24 peroenS of absolute alcohol, 25 cents per wine gallon: " AU such wines containing more than 24 percent of absottits alcohol by volume shaU be classed as dlstlUed tptaitm and shall pay tax accordingly." Is amended to read as follows: "On wines, containing not more than 14 percent of abaoluta alcohol. 10 cents per wine gaUon, the percent of alcohol under this section to be reckoned by volume and not by weight; " On wines containing more than 14 percent and not exoeedlng 21 percent of absolute alcohol, 20 cents per wine gaUon; " On wlnss containing more ttian 21 percent and not exceeding 24 percent of absolute alcohol, 40 oents per wine gallon; " All such wines containing more than 24 percent ol absolute alcohol by voliune shall be classed ss distilled q^trlts and shall be taxed accordingly." Sec. 7. So much ot section 618 at the Bevenue Act at 1918 (UJS.C, sup. VI, title 26. sec. 1300 (a) (3) as reads: " On each bottle or other contains at fhampsgns or ■p"fc"»»g wine, 12 oents on each one half pint or traction thereof; "On each bottle or other contains of aiilflclaUy carbonafesd wine, 6 cents on each one half pint or fraettao thsnof : " On each bottle or other contatnsr of llqueors, mrrHais. or ttaai- lar compoxinds, by whatever name sold or offered Xor sale, oontatn- ing sweet wine fortified with grape brandy. 6 oents oo saeb oas, half pint or fraction thereof " la amended to read as follows: " On each bottle or other container of champagne or qtaxlclliig wine. 0 cents on each one half pint or fraction thereof: " On each bottle or other container of artificially carbonated wine, 2^ cents on each one half pint or fraction thsrooC; " On each bottle or other container of liqueurs, cordials, or simi- lar compotinds, by whatever name sold or offered for sale, oentaln- ing sweet wine fortified with grape brandy, 1% cents on saoh one half pint or fraction thereof; "Any of the foregoing artldes containing more than 94 peroent of absolute alcohol by voltune shall be clsaeed ss dlstltlsd tptritB and shall be taxed accordingly." Sac. 8. Section 612 of the Revenue Act of 1918. as amended (re- lating to the tax on grape brandy and wine sfrtrlts withdrawn and used in the fortlflcaUon of wines) (U£.G.. sup. VI. title 26. sec. 1301) , Is amended by striking out " 10 cents per proof gaUon " and inserting In lieu thereof " 20 cents per proof gaUon." Sac. 9. (a) Section 608 of the Revenue Act of 1018, as amended (relating to the tax on malt Uquors) (U.S.C.. sup. VI, title 26. esc. 1330 (a) ) . is amended by striking out " a tax of $6 " and Inserting In Ueu thereof " a tax of $6." Mr. HARRISON. Mr. President. I want to make a brief explanation of the proposed bill. This bill is practically the same bill that was passed by the House oi Representatives, with only 5 dissenting votes. I believe. It inroposes to raise the tax on liquors from $1.10 a gallon, whldi is the rate in the present law, to $2 a gallon. I may say that if the bill shall be enacted, the liquors imported from foreign countries Lxxvni- -21 ^ t 322 CONGRESSIONAL not only will bear this $2 tax but will bear the tariff dut 7 also. So in the case of imported liquor there would be the tariff duty of $5. plus the $2 tax. or a $7 tax. The principi J provision of the bill is that providing for the increase in the tax on distilled spiirits from $1.10 to $2. Another part of the bill which was adopted in the Hous< f, and which was agreed to by the Senate committee, is the result of & suggestion of the Treasury Department that a stamp costing 1 cent be placed upon every bottle and eveiy container, the object being to differentiate liquors which aie legitimately sold from bootleg liquor. There is another change in the law made by the proposed bill. The last time we passed a liquor tax bill, we imposed a tax of $5 a barrel on beer with an alcoholic content up to 3.2 percent. We have eliminated the 3.2-percent provision since the repeal of the eighteenth amendment; and wharess beer with a content of over 3.2 percent has been heretofoie subjected to a tax of $6. under the proposed legislation ve levy a uniform rate of $5 a barrel. So if this proposal s enacted, the beer tax will be $5 a barrel, irrespective (f alcoholic content. I pass on to another change made by the committee arl recommended to the Senate but not carried in the bill as t passed the House. The object of the change is primarily to keep the Federal Government from injecting itself into ±e sphere of State taxation: and at the same time we desiie that the States refrain from injecting themselves into the sphere of Federal taxation. Prior to the adoption of the eighteenth amendment no State had a gaUonage tax. The privilege license taxes weie imposed by the States, and considerable revenue was, de- rived by them from that source. Gallonage taxes were im- -^Kwed only by the Federal Government. Recently a move- ment has been started in some States to impose gallonage taxes, because of a desire to get some revenue, believ- ing, perhaps, that there might be an interim l)etween the convening of Congress and the imposition of a higher tax than $1.10. For instance. New York has placed a gallonage tax of $1 on each gallon of liquor. Pennsylvania, I believis, has imposed a gallonage tax of a dollar, Massachusetts =1 gallonage tax of 40 cents, Arizona and Colorado 80 centii, and so on. We reduced the privilege license tax, or the occupational tax. on brewers of beer from a thousand dollars to $100. The tax fixed in the beer bill which we passed last year was a thousand dollars, and we are making the tax lighter to ths t extent. The committee refused to adopt an amendmei t proposed in the committee to reduce the beer tax from i5 to $3 a iMurel, but we agreed to this reduction in the priv - lege license tax on brewers of beer. Mr. BORAH. Mr. President The PRESIDING OFFICER (Mr. McAdoo in the chair . Does the Senator from Mississippi yield to the Senator froi a Idaho? Mr. HARRISON. I yield. Mr. BORAH. When we passed the beer bill at the lai t session, the tax was fixed at $5 a barrel. Mr. HARRISON. Yes. Mr. BORAH. One of the arguments for the imposition < if a tax of $5 a barrel and no more was that it would enab e the people dealing in beer to sell a glass of beer to the wori - logman for 5 cents a glass. Has that been the result? Mr. HARRISON. I have not had the actual experience i a the matter. 1 Mr. BORAH. No; the Senator is not a workingman. (Laughter.] Mr. HARRISON. The Information that comes to me s that they have not lived up to that promise. In certaia places beer is sold at 5 cents a glass, but as a rule thpse dealing in beer have not fulfilled that promise. Mr. BORAH. No; as a rule. Mr. President, they have no ;. and I think the exceptions are so rare that they would be difficult to locate. Mr. HARRISON. I agree with the Senator. Mr. CLARK. Mr. President, will the Senator yield? Mr. HARRISON. I yield. RECORD— SENATE January 10 Mr. CLARK. I may say to the Senator from Idaho that it is my information that beer is sold at 5 cents a glass all over the city of Baltimore, which is just a few miles from here. Mr. HARRISON. That is too far to go to get a 5 -cent glass of beer. [Laughter.] Mr. BORAH. Is the Senator from Missouri certain of his information? Mr. CLARK. I have repeatedly heard it said, and I may say that I stopped and bought a glass of beer in Baltimore for 5 cents the last time I came through that city. Mr. BORAH. I was informed this morning that there was practically no exception to the rule. It was earnestly contended that this tax of $5 was in the interest of 5-oent beer for the workingman. It was a false promise, as many contended at the time. Mr. HARRISON. Mr. President, some months ago the President, reali'iing that the eighteenth amendment would be repealed, appointed a very select group of experts from the various departments in the administration to give im- mediate study to the amount of tax liquor might bear with- out perpetuating the activities of the bootlegger. A very splendid set of gentlemen composed that committee. They worked on the question for some 3 months and then made their recommendations. They recommended, in their re- port to the President, which was not adopted, that dis- tilled spirits would bear a tax of $2.60 without perpetuating the bootlegger. The information given indicated that the cost of putting illegal spirits in the hands of an illegal re- tailer was $4.20 a gallon, including cost of manufacturing, graft, and various other payments he had to make, and that with a tax of $2.60, legitimate sellers of liquor could undersell the bootlegger. In the departmental report to which I have referred, it was recommended to the President that it might work well if only one gallonage tax should be imposed; that if we should impose a $2.60 gallonage tax and give to the States which permit the sale of liquor and do not impose a gallonage tax a 20-percent credit the States might be encouraged not to impose these gaUonage taxes. Personally, I favor the idea very much of giving to these States this credit, because I fear that some States may continue to impose high gallonage taxes and do exactly what we here and now are trying to prevent; namely, im- pose too great a tax. We all appreciate that if the taxes are too high, the bootleggers will continue in business. So it was the best thought of the House of Representatives and of the Committee on Finance, after full consideration, that a gallonage tax of $2 imposed by the Federal Government would be about as high as we could go, and would be about as low as we ought to go. That rate should not interfere with the activities of the States in the imposition of reason- able gallonage taxes. I may say, further, that in the proposed bill we continue to give to the States the sole authority to impose a tax on distilleries, and we impose such a nominal occupational tax or the privilege license tax that it does not inject the Fed- eral Government into the field of the States and prevent them from obtaining the largest amoimt of revenue they can from that source. And that revenue has heretofore been quite large. New York, for instance, imposes a tax of $15,000 on a distillery. That is the highest, I .believe. Other States impose lower taxes. Mr. SHIPSTEAD. Mr. President, will the Senator yield? Mr. HARRISON. I yield. Mr. SHIPSTEAD. As I understand the bill as it comes from the committee, it makes no distinction in the amount of tax imposed upon alcohol for beverage purposes and that imposed on alcohol used for nonbeverage purposes, alcohol used in the arts and sciences. Mr. HARRISON. I may say that the committee con- sidered that matter, becau.se there were some protests over the countiT against the imposition of the $2 tax on alcohoL Of course, industrial alcohol, denatured alcohol, bears no tax, but it was thought in the committee, and the Treasury Department had the idea, that if we differentiated as be- tween beverage and nonbeverage alcohol, we would get into confusion and trouble. The objections came from the per- 1934 CONGRESSIONAL RECORD— SENATE 82S fume people and the dmg people, because some alcohol is put into their products. The committee was told that that would not make a great difference, because the amount that goes into these extracts and into these medicines is quite small. It was an administrative difficulty, may I say. which pre- cluded action on the part of the committee in regard to that. Mr. WAL£H. Mr. President The VICE PRESIDENT. Does the Senator from Missis- sippi jrield to the Senator from Massachusetts? Mr. HARRISON. I yield. Mr. WAIiSH. I was about to say. as the Senator from MinsiMlppi has just said, that the Treasury Department emphatically asserted that they could not administer a law which made a distinction between alcohol used for beverage purposes and alcohol xised for nonbeverage purposes. The Treasury officials were very insistent that no such law could be operative. Mr. COUZENS. Mr. President The VICE PRESIDENT. Does the Senator from Missis- sippi yield to the Senator from Michigan? Mr. HARRISON. I yield to the Senator from Michigan. Mr. COUZENS. I merely wish to say that the Treasury Department stated that the aggregate difference in the tax would probably be $5,000,000; dividing that up among 125,- 000,000 people, the cost thereby would be probably not more than 12 cents per year per family. Mr. HARRISON. Yes. Mr. HEBERT. Mr. President The VICE PRESIDENT. Does the Senator from Missis- sippi yield to the Senator from Rhode Island? Mr. HARRISON. I yield. Mr. HEBERT. I observe in subsection 4 of section 1 that the $2 tax on distilled spirits is " on each proof gallon." Mr. HARRISON. That is true; and I may say that the same provision has been in eveiT bill taxing liquors. Mr. HEBERT. I understand that to be so. That means 100 proof. I believe. Mr. HARRISON. Yes. Mr. HEBERT. WiU not the effect of that be that the tax will exceed $2 a gallon upon whisky ordinarily sold in the trade? Mr. HARRISON. Of course, the liquor ordinarily sold is rectified liquor. The Government is going to get the benefit of that condition. Just as it has under all prior bills, because from a gallon of liquor 100 proof a larger volume of liquor of the rectified character may be made, and the Government has always imposed additional tax on rectified liquor. We are merely following the traditional policy in this proposed legislation. Mr. HEBERT. My understanding is that the practice in the trade is to produce liquor of about 50 to 65 proof. That means, does it not, that the tax to the consumer will be In excess of $2 a gallon? I am asking the question for my own information. Mr. HARRISON. It must be remembered that the man who has a gallon of 100 proof can take it and make fen* him- self probably 2 or 3 gallons of rectified liquor, and he sells it to the consmner at about the same price as he would the original gallon of 100 proof. May I say to the Senator that we estimate obtaining from the additional tax on rectified liquors $33,000,000 annually. Mr. HEBERT. I thank the Senator. Mr. COPELAND. Mr. President The VICE PRESIDENT. Does the Senator from Missis- sippi yield to the Senator from New Ycffk? Mr. HARRISON. I yield. Mr. COPELAND. Did I understand the Senator to say that there is an added tax on blended whisky? Mr. HARRISON. Thirty cents a gallon. Mr. COPELAND. That is the entire tax? Mr. HARRISON. That is the added tax on rectified liq- uor. On every additional gallon that is made from the straight whisky. Mr. COPELAND. The Senator knows, of course, that there will not be any other kind of whisky on the market than blended whisky. Mr. HARRISON. I hope that there Will not be. because ttM Govei-nment gets that much more tax. \ Mr. COPELAND. That is what I wanted to know. Mr. HARRISON. And if the public will be satisfied with Mended liquor, rectified liquor, we ought to be satisfied. Mr. COPELAND. May I ask to have the Senator explain in a word, if he will, what the additional tax to the Govern- ment then will be on rectified whisky as oontntsted with whisky that is not rectified? Mr. HARRISON. The additional tax will be 30 cents a gallon. Mr. COPELAND. That is. the tax on rectlfled whisky win be 30 centB above the tax on pure whisky? Mr. HARRISON. Yes. Mr. COPELAND. I understand. May I now ask another question concerning nonbeverage alcohol? Is it because of the difficulty ot control of nonbeverage alcohol that the Com- mittee on Finance objected to its being excluded from this regular rate? Mr. HARRISON. Very largely; yes. As was sUted by the Senator from Massachusetts IMr. Walsh], the Treasury De- partment officials said they thought it would present an ad- ministrative difficulty if we were to put a different tax oa nonbeverage aloohol from the tax put on beverage alcohol. Mr. COPELAND. The Senator from Mississippi is. of course, aware of the fact that in making carbonated bever- ages and ice cream and confectionery, baked goods, and similar products, there is used nonbeverage akx^oL Mr. HARRISON. Yes. Mr. COPELAND. And that the cost thereof comes di- rectly out of the consumer of those goods. The tax in such case is placed on a consumer who is not likely to drink liquor but who is a consumer of food products in which non- beverage alcohol is used. Did the otrnxmittee take into con- sideration the fact that there would be this consumer tax? Mr. HARRISON. Yes; and it Was pointed out by those who represented the Treasury Department that the increase in the tax from $1.10 to $2 would probably make a difference along that line of 20 cents pa- family throughout the United States. That is a small amount. A very small amoimt. I suppose the danger of diversion was Mr. COPELAND. Mr. HARRISON. Mr. COPELAND. also considered? Mr. HARRISON. Mr. COPELAND. That was considered. I wish to say for the record that I am extremely sorry that there could not be found a way by which there could be an exclusion of nonbeverage alcohol from the terms of the bill, because of the fact that that substance does go into food products used by the average family. However, if it is estimated that the increased cost will only be 20 cents per family per year, that is not a very substantial amoimt. Mr. HARRISON. I may say to the Senator that protests of this character appealed to me because such aloohol is used not only in various extracts but in medicines, and so forth. However, when the officials of the Treasury Depart- ment made the statement which they did. the whole idea of the committee was changed with reference to that matter, and the committee felt as did the Treasury Department offlclals that the kinds of alcohol could not be differentiated in fixing the tax. Mr. COPELAND. If the Senator is right in the state- ment which has been made that the charge to the average family would only be 20 cents per year, not much should be said about it. because I recognize the difficulty attached to the administration of the law in aragraph of section 202 relating to stami^. That section provides: Such stamps ahail be promptly affixed to the Immediate cot talners of such q>lrits, except that when such spirits contained n bottles in closed cases are held for sale or sold otherwise than it retail, such stamiM need not be affixed until the cases are opentd or sold at retail, when such stamps shall be immediately affixed to the bottles, but such stamps shall be sold or transXerred In co nectlon with any sale or transfer of such spirits and the persdn In possession of such spirits shall be In possession of such stamiw therefor. TAe Whisky is put up in cases, say 24 pints to the case stamps will not have to be affixed to the bottles but affixed the case, and the stamps would be transferred to the m£|n who purchases that case. If a bootlegger wants to have Government testify that the liquor which he is selling good, why can he not buy one of these cases? The will be delivered to him ; and then when he opens up the and takes out the individual bottles, he can put in thetn what he wishes and attach one of the stamps that has given to talm. stam]>s ca>e belrlU In actual process of rectification, blendln ;. or bottling, or in actual uae in processes of manufacture; (e) Distilled splrlti on which no internal -revenue tax is n- quired to be paid; (f) DlatUlMl aplrlta not intended for sale or for ua* In ttit manufacture or production of any article intended for aale: BPtiHioi' from MtAMisAippt by the junior tMhaiof from Kfntu«iiy (Mr. LmamI, now iff amihti, Thf PtUMUt^WO ornOiH. Thffi WM HO furihfff (hi* OUiNtoAi Mr. RIYNOLD0. With roforoaet to thAt ptrtleutar pari of scetlon 90a which waa brought to tht attontlon of tht Senator from MlaalMlppl by tbo attuttor from Ktntueky (Mr. LooAwl, X deilre afaln to oftU tho m*ttor to tht atten- tion of the Senator from Mlaalialppl. The language In paragraph 303. on p«go 10, btglnnlnf with Une 4, the word " such ". to aa foUowi : Such itamps shaU b« promptly aaB«d to the inunedlata eon- talners of such splriu, axeept that when suob spirits oontalnotf' m bottles lu closed cases are held for aalt or aold otberwiM than at retaU, such stamps need not be aiBzod untU the oases are opened or aold at reUU, when such atampa ahaU be tmmedlatoly afflxad to tha bottles, but such atampa ahaU bo aold 'or trans- ferred In conoeetlon with any sale or tranafer of such spirit* and the peraon In posseaalon of such aplrlU ahaU be la possswloa of such stamps therafor. I interpret that to mean that when one is engaged in the business of distilling or manufacturing liquor, and making sales to wholesalers, who in turn sell to the retailers, when the bottled liquor, in case. Is delivered from the manufac- turer or the distiller to the retailer, each case is to be ac- companied by stamps sufficient to be pasted upon each bottle sold at retail. It is my opinion that this measure should require before the distiller or the manufacturer permits such cases to leave the factory or the doors of the distillery, every single bottle in a case should be stamped by the distiller, who is then in the possession of the revenue stamps. Mr. HARRISON. Mr. I*resident, I may say to the Senator that the provision to which he is referring applies only to liquor that is held at the date this proposed act shall take effect. It will not apply in the future. Mr. REYNOLDS. It will not apply to the future? Mr. HARRISON. No. Mr. KING. It is not prospective. Mr. REYNOLDS. Then I have no objection to that por- tion of the measure. Mr. WALSH. Mr. President, I should like to have the attention of the Senator from Mississippi for a moment. I hold in my hand a telegram which I should like to read to him. It is as follows: BosToir. Mass., January 10. 1934. Senator David I. Walsh. Senate Office Building: Thanks for your interest. Hope proposed stamp tax, of which I read In Herald this morning, does not apply to flavoring extracts and medicinal preparations containing alcoiiol — ^would be diaaa- trous to sale of smaJl-alze packagea. Oxoacs H. BvmHwrt. I want the Rcc(»d to show that there is no occasion for the alarm expressed in this telegram because at no time has there been a requirement, under past laws or regulations, for a stamp tax upon extracts or mc^cines. I understand that this provision for a stamp tax applies only to splrituoua liquors. Am I correct in making that statement? Mr. HARRISON. I think the Senator is correct. Mr. WALSH. Mr. President, I do not want to delay the passage of this bill, but I desire to speak briefly on the sub- ject of the tax upon beer. In the committee I offered an amendment seeking a reduction in this tax in the hope and expectation that it might result in furnishing the pubUo with a glass of beer at the popular price of 5 cents. Some of the Senators have already, throagli inquiries made of the Senator from Mississippi, indicated that the public was unable under existing conditions and taxes to receive a glass ^f beer for 5 cents. I have made some in- quiries and studies into the subject, and I find that the interdepartmental committee found that beer was being lold at wholesale at $13 per barrel. Hm very bast of bser, I understand, is not more then $19 por berrtl. The uauel price, however, Is about 111 per berrel, and thla wholesale price inoludes the tax that hes bsen levlsd upon bstr. namely. M tm barrsl. There sfs ever 4M iUmmm of bsef In a barrel. Thffr» \Hfinn 490 rIaiimm of beer tti e bArrel. tht reteUer tm been rt'Ofivihg at 10 eente m iImm iboul IM fw thi tMitvl of bmir wh(«H omI hUn iMit lili tfn^ar IH«M fMUi. whloh ira not Mrtowty dKnNitMli tl wouiu attm to mo W iMUotIo thai tho Im of M a bArm 330 should not prevent a reasonable profit to the retailer and the possibility of a glass of beer for the working class at 5 cents per glass, for if the retailer can purchase beer at il2 per barrel, and as there are 490 glasses of beer in a bar -el, it can readily be seen that the retailer will be able to uu ,ke a very substantial profit on beer at 5 cents a glass, amoujit- ing to as much as 100 percent of the wholesale price. Mr. KING. Mr. President The VICE PRESIDENT. Does the Senator from Massa- chusetts yield to the Senator from Utah? Mr. WALSH. I yield. Mr. KING. It occurred to me when the matter was unAer discussion in the Committee on Finance, of which the S n- ator from Massachusetts and myself are members, tliat there ought to be some difference in the charges betw(«n beer which has an alcohohc content of 3.2 percent and less as compared with beer which has a higher alcoh61ic con- tent. I was wondering if the Senator has given any thou :ht to that particular subject. It seemed to me then, as it d )es seem to me now — and I was not satisfied with the action of the committee — that we ought to have made some differei ti- ation between the two classes of beer. Mr. WALSH. I have entertained, Mr. President, the same opinion the Senator has just expressed. There are, hew- ever, certain difficulties in the way of levying a different tax upon beer with 3 J percent alcoholic content and b?er with a higher alcoholic content. First of all. the matter of administration. The Treasury Department stated it woild be very difficult, if not impossible, of administration. Thjre are, however, other difficulties. There has been an underneath fight, I will say with he Senator's permission, between the producers of light b?er and the producers of heavier beer, known as " ale ", anc it was originally proposed that a separate tax be imposed ujon beer known as " lager " and a higher tax upon beer known as " ale." All that was discussed before the Committee on W lys and Means, and they finally concluded that the best \^ay to handle the problem was to levy a flat tax of $5 iei barrel on all types of beer, regardless of alcoholic content. I will say to the Senator that I have reached that cone iu- sion too, after first being greatly impressed with the fict that there should be a difference in the taxes as betwiien beer which is not intoxicating and beer which may be intc xi- cating. A concession has already been made on beer that Is n- toxicating. Under the present law the tax on beer, otier than 3.2 percent, is $6 per barrel. This proposed rate is $5 per barrel. As the Senator also knows, the rate row upon the 3.2 percent beer is $5 a barrel. So that the rite that is imposed in this measure does not make any increi.se. I am satisfied from a review of the discussion that there is no reason why the American public cannot, with a $5 barrel tax. get a 5-cent glass of beer, tmless there is seme profiteering along the line. I am also informed by he experts of the Govenunent who have reviewed this subject that practically all beer in Milwaukee is 5 cents per g&ss now. The Senator from Missouri [Mr. ClasxI this mom ng informed the Senate of the fact that good beer can be obtained in the city of Baltimore at 5 cents a glass, ani I am also informed that there are places in Washin^ion where one can get beer at 5 cents a glass. It seems to me that on the whole this rate is fair, 4nd especially in view of the fact that there is such great n sed of revenue, and a reducing of this rate would very substi ji- tially reduce the total revenues that the Govemmentlis going to receive. The Committee on Finance did. however, make a cAn cession with the idea of lessening the arffument that we were taxing the beer industry too much, by reducing he occupational tax paid by the brewer from $1,000 to tioo That is to the advantage of the brewing industry in duclng its overhead and the cost of producing good beer a popular price. I am content, Mr. President, as I said before, that ihe Interdepartmental conunittee have done a very good Job in their study of this question and in the rates they bikve CONGRESSIONAL RECORD— SENATE January 10 re- at recommended. They have carried out the wishes of the President and of the members of the committee to recognize this as a social problem as well as a revenue problem; therefore the rates have not been extreme on either spir- ituous liquors or on beer or upon wine. The rates do not interfere with the desideratiun of pro- viding fine beverages at reasonable prices to the American public. I hope the bill will pass without amendment. The VICE PRESIDENT. The bill is open to amendment. Mr. CLARK. Mr. President, I offer an amendment, which I ask to have stated. The VICE PRESIDENT. The amendment will be stated. The Chief Clerk. At the end of title I. it is proposed to insert a new section, as follows: Section 5 of the act entitled "An act making appropriations for the Post Office Department for the year ending June 30, 1918 ". approved March 3, 1917, as amended. Is amended to read as follows : " Sec. 5. Whoever shall order, purchase, or cause Intoxicating liquors to be transported In interstate commerce, except for Bclentlflc. sacramental, medicinal, and mechanical purposes. Into any State, Territory, or the District of Columbia, the laws of which prohibit the manufacture or sale therein of intoxicating liquors for beverage purposes, shall be fined not more than $1,000 or imprisoned not more than 6 months, or both; and for any subsequent offense shall ,be imprisoned not more than 1 year." Sec. 2. Nothing in this act shall be construed to amend or repeal any provision of section 1110 of the Revenue Act of 1918. Mr. CLARK. Mr. President, the amendment which I have just offered is designed to repeal a portion of what was ! known as the " Reed amendment to the Post Office appro- j priation bill of 1917." That amendment consisted of two ; parts. The first part prohibited the sending by mail or ex- ; press into any dry State of any periodical or newspaper con- taining advertisements of spirituous liquors. The second portion of the Reed amendment prohibited the shipment into a dry State of any beer or spirituous liquors. The first part of it is now working a great hardship on a great many newspapers, and is not serving any useful public purpose whatever. I do not think it will he gainsaid that, as a fundamental proposition, advertising of liquor does not increase the gross sale or gross consumption of liquor. It may change the distribution between various firms that are manufacturing liquor, but certainly nobody begins to drink liquor because he reads an advertisement of it in a news- paper. As it operates at present, some newspapers are compelled to get out as many as five or six different editions in order to conform to the various law.j of different States into which they are sent. Under the present law magazines are going out constantly with great blajik spaces where advertising has been left out. I do not believe any purpose whatever is to be served by maintaining that portion of the amendment on the statute books. The amendment as drawn retains in the statute the prohibition against shipment of liquor into dry territory, Mr. KINO. Mr. President The VICE PRESIDENT. Does the Senator from Missouri yield to the Senator from Utah? Mr. CLARK. I yield. Mr. KING. I ask the Senator as a legal proposition, and I should be very glad to get his view, whether the repeal of the law which his amendment contemplates would prohibit a State that was controlled by very dry sentiment from passing an act forbidding advertisements of the sale or man- ufacture of alcohohc liquors forbidden to be sold within the State? Mr. CLARK. I do not think It would. Mr. KING. In other words, the Senator does not think that the Congress would have the right, under the interstate commerce power which it possesses, to prohibit a State which is dry from prohibiting such advertisements within the State? Mr. CLARK. That is not my opinion. Mr. KINO. Would not the amendment proposed by the Senator from Missouri really go a httle farther than he contemplates? 1934 CONGRESSIONAL RECORD— SENATE 831 Mr. Cf^ARK. I do not think so. The only extent to which my amendment goes is simply to strike out certain language In the so-called " Reed amendment " to the Post Ofllce appro- priation bill of 1917. It was necessary to set out the second part thereof in this amendment because the penalties were contained in the part which I am seeking to strike out. I have simply rewritten the second portion of the existing Reed amendment to include the penalties in that section. Mr. WALSH. Mr. President, may I ask the Senator if this amendment is similar to the amendment that was incorpo- rated in the law legalizing 3.2 beer? Mr. CLARK. Precisely; it conforms exactly to what we did in the case of the beer bill. Mr. WALSH. It is simply extending the principle that was applied in the case of 3.2 beer? Mr. CLARK. That Is correct. Mr. McKELLAR. Mr. President, will the Senator yield? Mr. CLARK. I yield. Mr. McKELLAR. Does it change the penalty provided in the Reed amendment? Mr. CLARK. No penalty is contained in the first portion of the provision which I am seeking to strike out. I have simply rewritten it and applied its other portion to the pending bill. Mr. HARRISON. Mr. President, of course, we were going to have another bill that will come along to which this amendment would more aptly apply. I have no objection to the idea. Mr. TRAMMELL Mr. President, will the Senator from Missouri yield? Mr. CLARK. I think the Senator from Mississippi has the floor. Mr. HARRISON. I yield to the Senator. Mr. TRAMMELL. What I should like to be assiired of Is that this amendment — I have not had an opportunity to read it — does not give any advantage to the periodicals and newspapers outside a State over papers published within a State in the matter of carrying advertising. Mr. CLARK. It gives none at all; it simply repeals the provision of the present law. Mr. TRAMMELL. That is something that we should be very certain of, I think, because certainly publications within a State should have the same advantage and the same opportunity for carrying these advertisements that are enjoyed by papers without a State that might circulate within a given State. Mr. CLARK. It gives them no advantage whatever. As the Senator from Massachusetts has pointed out, it is pre- cisely the same provision that was contained in the beer bill. Mr. TRAMMELL. I have no objection to the amend- ment; I just wanted to raise that question and to make sure with regard to that particular point. The PRESIDING OFFICER. The question is on agreeing to the amendment offered by the Senator from Missouri. Bdr. SHEPPARD. Mr. President, it seems to me that for the proper protection of the " dry " States the language the Senator seeks to have repealed ought to be retained, and I shall therefore vote against the amendment. The PRESIDING OFFICER. The question is on agreeing to the amendment offered by the Senator from Missouri. The amendment was agreed to. Mr. CLARK. Mr. President, I desire to offer another amendment. The PRESIDING OFFICER. The Senator from Missouri offers an amendment, which will be stated. The Chist Clkrk. On page 8, after line 17, It is proposed to insert the following: 8sc. 13. There shaU be levied, coUected. and paid upon all wines and distilled spirits when imported Into the United States or Into any of Its possessions (except the Philippine Islands, the Virgin Islands, American Samoa, and the island of Guam), or when with- drawn from bond for consumption or use, If such wines or distilled •pints are exp>orted directly or indirectly from any foreign country which is In default on Its national Indebtedness to^ the United States Inciirred in connection with the World War. the following duties, respectively: On wines. $3 per gaUon; on dlstUled spirits, $6 per gallon. Such duties shall be In lieu of the duties pre- scribed under exlstlog law; and the provlslona of existing law (ittciTidlng penalUea) thaU apply to the taatmraent and eoUectloa of such duties. (b) The amount of duties collected under the prorlstona of sub* section (a) shaU be credited to the amount due on meh national indebtedness to the United State* of such fMvign country and ShaU be considered payment on account of such Indebtedness by such country. The PRKSroiNO OFFICER. The quesUon la on ftgreeing to the amendment offered by the Senator from Missouri. Mr. HARRISON. Mr. President, I hope the Senator wiU not insist on that amendment, because it will merely prolong the discussion to, perhaps, a considerable extent I am very anxious to get this bill acted on by the Senate ftnd aent over to the House this afternoon so that the House may concur in the amendments made by the Senate. Mr. CLARK. Mr. President, so far as I am concerned, I have no desire to debate the amendment: it speaks for itself. It Is directed to this proposition, that the principal nations of the world which are in default to us are looking to the repeal of the eighteenth amendment to lead them out of the depression, and at the same time they are thumbing their noses at us on the debts they owe us. This amendment is for the purpose of penalizing the nations Uiat are acting as deadbeats in the world. Mr. HARRISON. I ask for a vote. Mr. NORRIS. Mr. President. I think I am in entire sym- pathy with what the Senator from Missouri seeks to accom- plish, but I have never read the amendment; I have only heard it as the clerk has read it. and, as I caught It from that reading, it seems to me there are some portions of it that ought to be stricken out. It ought to stop, as I view it, at the levy of the extra tax. There is some provision in the amendment about a credit that Is to be given on the debts. That provision ought to be stricken out. I think. Mr. CLARK I am Inclined to think the Senator is cor- rect about that, and I am perfectly willing to withdraw that portion of the amendment. Mr. NORRIS. Very well, let it be read again with those words out. The PRESIDINO OFFICER. The clerk will report the amendment as modified. The Chiv Clerk. It is proposed to strike out oi the amendment paragrai;^ (b), as follows: The amount of duties collected under the proTlslons of sub- section (a) ahaU be credited to the amount due on such national Indebtedness to the United States of such foreign coiintry and shall be considered payment on account of such Indebtedness toy such country. Mr. JOHNSON. Mr. President. I ask to have the amend- ment read as it will read with subsection (b) stricken out. The PRESIDING OFFICER. The clerk will read the amendment as modified. TTie CHixr Clerk. On page 8, after line 17. it is proposed to Insert the following: Sac. 13. There shall be levied, collected, and paid upon all wines and distilled spirits when Imported Into the United States or Into any of Its possessions (except the Philippine Islands, the Virgin Islands. American Samoa, and the island of Ouam) , or when with- drawn from bond for consumption or use. If such wines or dis- tilled spirits are exported directly or indirectly from any foreign coxintry which Is In default on Its national Indebtedness to the United State* Incurred In connection with the World War, the fol- lowing duties, respectively: On wines. $3 per gallon: on distilled spirits. $5 per gallon. Such duties shall be In addition to ths duties prescribed under existing law; and the provisions of exist- ing law (including penalties) shaU apply to the asMssmsnt and coUectlon of such duties. Mr. WALSH. Mr. President, I should like to Inaaire of somebody who knows, what are the duties imder the existing law? Mr. HARRISON. The present tariff rate Is $5 per gaUon. Mr. WALSH. I thought a different scale of duties applied to wines and distilled spirits. Mr. HARRISON. That Is true. Mr. WALSH. What are the duties on wines? Mr. HARRISON. The duty on champagne is $6 a gallon. Mr. WALSH. Is the result, then, going to be simply to penalize the American peoide who consume these wines and liquors, or is the amendment really going to be effective in 4 ! > i CONGRESSIONAL RECORD— SENATE 332 calling the attention of the authorities of foreign counties to the fact that we want our debts paid? It seems to lae that we ought not to penalize our own people who want to drink imported liquors. Is it merely an extra tax. or ^iU it be effective In awakening the conscience of the responsH le leaders of foreign countries that owe us debts? This bu^ ness of -retaliatory or punitive tariff duties is dangeroiis can lead to most serious consequences and become mdre harmful to the country imposing than to the country that It is sought to punish. Such action ought to be taken af careful study of all aspects of the Issue. Mr. CLARK. Mr. President. I will say to the Sena from Massachusetts, if he will permit me. it was my tho In proposing such a tax as this that it would awaken self-interest of the debtor European nations to the fact t the United States is thoroughly in earnest in wanting p^id the debts due it. I think it is a sufficiently large tax. wMle not being prohibitive, to bring about that result. Mr. WALSH, That was the reason for my inquiry as to what the existing tax is. Can we not have some sched ile of taxes submitted to us so that we will know what we are voting on. and not suddenly and quickly put an extra lax on w^ithout knowing what the present tax is? Mr. KING. Mr. President, the question presented by he amendment offered by the Senator from Missouri was c« n- sidered in the House when the bill before us was under d Is- cussion. and a similar motion was rejected. My recollect on is that the Committee on Ways and Means, in preparing 1 he bill, also considered and rejected the proposition. It ceems . to me that this is an inopportune time to deal with the f ^ )r- eign debt question. It is quite likely Congress will consiiler before adjournment the question of the Indebtedness of for- eign governments to the United States. There are many angles to this question and important problems that will be encoimtered in its determination. The American people are eager to find markets for their surplus products. Recently loans were made to China to enable her to buy American wheat and cotton, and suggjs- tions are being made from time to time by representatives of agriculture that plans be evolved and put into operation tiat will result in finding markets for siirplus agricultural c modities. We know that our manufacturers and Indus Ists are seeking outlets for their products. In every our land we hear statements to the effect that there been overproduction, that warehouses and mills and eieVa- tors are overflowing with the products of field and farm £ nd mill and factory, and that foreign markets must be secu'ed for these enormous surpluses. The administration, as we know, is desirous of findng foreign markets for the sale of American products. Ev*ry rational person knows that trade and commerce are inais- pensable to the welfare and prosperity of individuals { nd nations. Reactionary policies have been Impediments to inter la- tional commercial transactions. A few 3^ars ago our ex- ports amounted to from six to eight billions of doUirs. They have diminished until for the year 1932 they ¥iere approximately $1,600,000,000. and the balance of tradej in favor of the United States was but three hundred I might add that for the same year we imported France commodities of the value of $44,736,000 ^and sol France commodities of the value of more than $111,561 and during the current year our exports to Prance bee^ery much larger than our imp(Hts. It is obvious if UR amendment pending becomes law, it will pro retalitory measures and our exports to France will be terially diminished, if not absolutely interdicted, which result in material iiviury to our industrialists as well agriculturists, who are finding markets in France for of their surplus products. Canada has been our best market. Great Britain been second on the list, and France has been one of largest purchasers of American commodities. We profiting more than is France by the commercial relatibns between the two countries. Any course that will cut off 3ur trade with France will injure hsr less *h^r\ it wUl the Un ted January 10 States. It is true France, as well as other countries, have faUed to meet their payments to our Government: they have defaulted in their obligations to us, and this situation calls for earnest, calm, and judicial consideration. We cannot, it seems to me. in a sort of cavalier way meet this important question. There has been no serious and intensive examination of the broad questions involved. There is no report, so far as I am advised, resulting from a comprehensive study of all of the questions involved, together with the implications that will inevitably arise therefrom. This debt question has broader impUcations than arise from the adoption of the amendment under consideration. As indicated, the failure of governments to meet their obligations to our Government may well warrant a thorough examination and a compre- hensive study, with a view to formulating a policy and a line of procedure adequate to meet the situation. The adoption of the amendment before us is attacking a problem in a piecemeal way and not in a broad and comprehensive manner. Senators should, in considering this matter, keep in mind the fact that under the regulations now in force all wines and liquors imported are placed under quotas. I am not clear as to the authority of th.e organization with which Mr. Choate is connected to modify quotas after they are promulgated. It may be that if it is desired to punish France, authority now exists to restrict imports of wines and liquors from France. At any rate, this debt problem is one which may not be disposed of by the motion of the Senator, and I repeat when I declare that there are so many angles to be considered, and so many ramifications affecting the question, that it would be unwise, in my opinion, to adopt the amendment referred to. The senior Senator from California has a measure pend- ing which will be considered within the next day or two which, directly or indirectly, deals with the question of for- eign debts. Under the circumstances, I venture to suggest that it is the part of wisdom to follow the action of the House when a similar amendment is offered and vote down the pending amendment. Mr. HARRISON. Mr. President, I hope very much that the Senator from Missouri will not insist on a vote on this amendment. It is a question that was not considered by the Finance Committee. Whenever we get into a discussion on the foreign debt default it arouses the passions and the prejudices of Senators, and I include myself because I have no sympathy with some of those nations that are not trying to make some effort at least to pay something' upon their debts. But here we are bent upon trying to pass a domestic measure that will increase taxes on a particular product that will be helpful to our own country. This amendment, if adopted here expressing the sense of the Senate, is likely to tie up the matter indefinitely. Such a step should be taken most carefully and after mature deliberation and considera- tion. The amendment should be drawn with care and should be debated for a considerable time, because every Senator would want to express himself upon it. I hope, Mr. President, that it may not be insisted upon at this time. I should vote against the amendment even though I am in entire sympathy with its purposes. Some of the foreign countries have paid part upon their debt. The amendment touches them all. regardless of that fact. I have more sympathy with England than I have with France because England has done much more than has i Prance, and yet the amendment would impose the same pen- alty upon one defaulting nation as on the other. The only nation that would be excepted would be Finland, to which the President called attention the other day. If the Senate should act now on this matter, perhaps influenced by a belief this is not the psychological time or that it is inopportune and that such a provision should not be incorporated in a bill such as the one now pending before us, and if we should vote it down by 3 or 4 to 1, it would be herailded in the press of foreign countries that such was the sober expression of the Senate of the United States. I do 1934 CONGRESSIONAL RECORD—SENATE 333 not want that Impression to go out. I would rather have it be reported that the Senate unanimously adheres to the position it has already taken and expressed in other resolu- tions passed to the effect that we want these debts paid. I have no doubt that the matter ought not to be pressed at this time and put upon this bill; first, because it will not carry with it a full and frank expression of just what the Senate may think; and second, because it is likely to cause a delay in the final enactment (A this imperative legislation for liquor taxation. Then, too, it is no secret that President Roosevelt has been considering the question of submitting a message to the Con- gress on reciprocal trade or marketing agreements. In those agreements the President would take into consideration whether a defaulting nation had made part payment or not, so that it would be unnecessary to write it into other legis- lation. It ought not to be written into such legislation as this. Diplomats do not act in that way. The Senate has expressed itself about the debt question. It has expressed itself unanimously against cancelation of the debts in the moratorium resolution which we adopted. Let us not clog the wheels here in connection with this legislation which we want to expedite so the Government may receive the tax money involved. When the reciprocal trade legislation comes here it would be a more appropriate time, if the Senator from Missouri wanted to offer his amendment, for the Senate then to con- sider it. If we have confidence in those carrying on the dip- lomatic relations of the country and those who are admin- istering the Government, then such matters as this should be left to them to consider instead of writing them into law and saying they must do this and must do that. Let us not at this particular time slap somebody in the face. Let us not try to clog and disarrange some of our diplomatic relation- ships, because it is unnecessary in the writing of a tax bill relating to liquor. I hope the distinguished Senator from Missouri will not insist upon his amendment under the circumstances. Mr. WALSH. Mr. President, I merely wish to call atten- tion to a line in the address of the President on the convening of Congress: I expect to report to you later In regard to debts owed the Government and the people of this country by the governments and peoples of other countries. Mr. JOHNSON. Mr. President, as I understand the amendment. It neither settles one question nor another in respect to the foreign debts, but it deals with the very sub- ject matter of the bill that is now under consideration. We have before us a bill providing a tax upon liquors. The amendment increases the tax upon imported liquors. It does it, it is true, as against defaulting nations in their payments to the United States upon the indebtedness now existing, but for the love of heaven is there any reason why the United States, or the Congress, dealing with a taxation measure, should not penalize in favor of its own people those nations which decline to honor their obligations to us. Dealing with the amount of money that is to be realized from liquor, dealing with those particular countries that have defaulted in their payments to us, is there any reason why we should not tax their liquors at a higher rate than we tax our own? That is all that is presented by the amendment except, of course, the use of the interdicted words, " the defaulting nation in payment of debts to the united States." Tt that is all there Is to the amendment, there is not, in my opinion, any reason why it should not be adopted. It will aid Americans. It will aid wine men throughout this Nation. It will add to the revenue collected from liquor in this country under this bill, and there is no reason that I can fathom why that should not happen. I cannot answer any of the inquiries that have been pro- pounded in respect to reciprocal trade relations. On the 27th of December, after reading in the press that there has been some relationship established between a quota upon wines in Prance and the delivery of some apples from the United States to France, I addressed a communication, which I trust was wholly courteous In character, to Mr. livesey oT the Senate Department, who is advertised as the gentleman who has made the arrangements with Prance, asking what it was and asking as well for information upon the quotas that had been establislied by France in relation to American goods. Of course, that communication was delivered during the holiday season. I concede, and equally of course I concede that from the 27th day of December until the 9th or 10th day of January would not afford ample opportunity for a dis- tinguished member of the State Department to reply to a courteous query addressed by a Member of the United States Senate. So I have not at hand the exact information that I sought at that time, and perhaps I may never have it. for I have had some dealings in the past with distinguished gentlemen in my search for knowledge that might enable me to legislate accurately, and my experience at least has aroused within me a skepticism that perhaps I may never obtain offi- cially that which I thus seek. But, sir, there is another aspect to this as well. It may be the question should not have arisen in this particular mian- ner. I doubt that, however, for I think it a perfectly proper amendment. When confronted with an amendment of this sort which expresses the opinion of the Senate concerning the debts that are due and which puts upon those defaulting nations at least the penalty of paying a higher tax upon that which we are making ourselves, there is no reason of the slightest character why that shoxild not be undertaken. I have a bill upon the calendar which possibly may be reached this afternoon — ^if not, when the next call of the calendar is made — ^the design of which is to have the Con- gress of the United States upon record so that there can be no mistake respecting it. It prohibits, in the future, the sale or the dealing in foreign securities of various countries which have defaulted in their indebtedness to us. I cannot assume, sir, that there will be any objection to a measure of that sort. It ought to be passed, and it ought to be passed instanter; but I see no objection to an additional tax to those nations which have defaulted, and I trust that the amendment of the Senator from Missouri may be agreed to. The PRESIDING OFFICER (Mr. PoPi in the chair) . The question is on the amendment of the Senator from Missouri [Mr. Clark]. Mr. NORRIS. I ask that the amendment be stated again. I have been trying to get It in order to read it but have been unable to do so. The PRESIDING OFFICER. The amendment will be restated. The legislative clerk read as follows: Sec. 13. There shall be levied, collected, and paid upon all wines and distilled spirits when Imported Into the United States or Into any of Its possessions (except the Philippine Islands, the Virgin Islands, American Samoa, and the island of Guam), or when withdrawn from bond for consumption or use. if such wines or distilled spirits are exported directly or Indirectly from any foreign country which is In default on its national indebtedness to the United States incurred in connection with the World War, the following duties, respectively: On wines. t3 per gallon; on distilled spirits, $5 per gallon. Such duties shall be in addi- tion to the duties prescribed under existing law; and the pro- visions of existing law (including penalties) shall apply to the assessment and collection of such duties. Mr. NORRIS. Mr. President, may I have the attention of the author of the amendment? Where reference is made to "existing law", ought It not to be "this act"? Are those duties prescribed in this act? Mr. CLARK. No. Mr. NORRIS. I am Informed that it does not Impose those duties. Mr. CLARK. Mr. NORRIS. all right as it is. The PRESIDINO OFFICER. The question is on the amendment of the Senator from Missouri [Mr. ClakkI. Mr. AUSTIN. I suggest the absence of a quorum. The PRESIDING OFFICER. The clerk will call the roIL No, sir. Then it seems to me the amendment is 334 CONGRESSIONAL I :ECORD— SENATE The legislative clerk called the roll, and the following Senators answered to their names: Adams Oopeland Aahurst Couzens AuatSn Cutting Bachman Davis BaUey Dickinson Bankhead Dleterlch Barbour DUl Barkiey Dutty Bone Erlckson Borah PeM Brown Fletcher Bulkier rrazler Bulow George Byrd Olasa Byrnes Ooldsborough Capper Gore Caraway Hale Carey Haniaon aark Bastlngfi Connally Hatch CooUdga Hayden Mr. LEWIS. I desire to Alabama [Mr . Black] anc Beynolds Robinson. Ark. Robinson, Ind. Russell Schall Sheppard Bhlpstead Smith Stelwer Stephens Thomas, Okla. Thomas, Utah Thompson Trammell Ty dings Vandenberg Van Nuys Walsh Wheeler Hebert Johnson Keyes King La Follette Lewis Logan Lonergan McAdoo McGlll UcKellar McNary Mvirphy Neely Norrls Nye OlCahoney Overton Patterson Plttman Pope I desire to announce that the Senator from Black] and the Senator from Nevada [Mr. McCarrah] are detained in an important committee meet- ing of the Senate. I also desire to announce that the Senator from New York (Mr. Wagkir] and the Senator from Colorado [Mr. Costigan] are detained from the Sena'te on important de- partmental business. Mr. OVERTON. I desire to announce that my colleague the senior Senator from Louisiana [Mr. Long] is necessarily detained from the Senate. The PRESIDINQ OFFICER. Eighty-two Senators hav- ing answered to their names, a quorum Is present. The question is on the amendment of the Senator from Missouri [Mr. Clark 1. Mr. NORRIS. I ask for the yeas and nays. Mr. DILL. Mr. President, I think there is much merit in what the Senator from Arizona has said. On the other hand, there ought never to be any misunderstanding as to the sentiment of the people of this coimtry, and. I believe, of the Members of this body, on what our attitude should be toward a country which does not even make an attempt to pay a debt that it has not only recognized, but recognized by an agreement under which we have agreed to cancel the entire principal of the debt if the country will but pay a rate of interest upon that principal. I think It is unfortunate that the amendment should be ^presented at this time; but, since it is presented, it seems to me that, from my viewpoint, there is only one thing I can do, and that is to express my views by voting for the amendment. Mr. ROBINSON of Arkansas. Mr. President, I inquire whether the amendment was submitted to the Committee on Finance? Kfr. HARRISON. It was not submitted to the Committee on PlnaiKe. The committee gave it no consideration at all. Mr. LA FOLLETTE. Mr. President, I am sm-e the Senator wishes to be accurate. If my recollection serves me cor- rectly, the Senator from Missouri desired to offer the amend- ment in the c(Hnmittee, but the Senator from Mississippi asked him to offer It Instead on the floor. Mr. HARRISON. My recollection is that that was an amendment with reference to advertisements going out of wet States into dry States. I recall nothing In the world with reference to this amendment coming up in the committee. Mr. LA FOLLETTE. Tlie Senator may be right about that. Mr. CLARK. That statement is correct. I did not offer the amendment in the committee. Mr. HARRISON. I may say further to the Senator from Arkansas that so anxious were we to divorce these other controversial matters from this legislation and speed this bin along that we left out the tariff question. We con- sidered first Incorporating in the bill the reciprocal trade- agreement authority to the President, but we wanted to eliminate possibilities of controversy, and for that reason we left it out of the bilL January 10 I hope very much that this question will not become in- volved in the pending legislation; and while I am in sym- pathy with everything the Senator from Missouri is pro- posing, this is Just not the proper place for the amendment to go on; I hope, therefore, it will be rejected. Mr. ROBINSON of Arkansas. Mr. President, the amend- ment involves not only the imposition of duties which wiU provoke, as has already been announced by one Senator, tariff issues in the Senate which would be difficult to deter- mine and probably invite retaliatory tariff action by some foreign governments, but it also involves questions of policy to which little consideration has been given except by those Senators who have been fortunate enough to have the oppor- timity of studying them. I do not believe this amendment ought to be incorporated in the bill. The PRESIDINO OFFICER. On this question the yeas and nays have been demanded. Is the demand sufficiently seconded? The yeas and nays were ordered. Mr. NORRIS. Mr. President, I had not intended to say anything on the pending measure, because I am anxious to expedite it, just as is every other Senator; but those who desire to defeat the pending amendment have urged various objections to it which seem to me to be unwarranted. What is this amendment which everybody favors but no- body wants? We are told that the Senate is for it, and that the country is for it, but that we are not to vote for it. We are told that it was not offered in the committee. If it be true that that is an objection sufficient to warrant the defeat of the amendment, then it must follow that whenever any legislation is proposed here in the future it must be passed as the committee reports it, without oppor- timity to offer amendments in the Senate. I concede, to begin with, that it would have been better if this matter had been handled in the committee, if they bad had an opportunity to frame the amendment; but the committee did not do that. Mr. CLARK. Mr. President, will the Senator yield to me? Mr. NORRIS. I yield. Mr. CLARK. I should like to say, on that point, that when the bill was reported on Monday the committee had had it imder consideration in the afternoon, the Senate was being held in session, and it was deemed very im- portant that the bill be brought in. I had previously announced that I intended to offer this amendment, but I did not see any necessity to delay reporting the bill by presenting the amendment in the committee. Mr. NORRIS. Mr. President, the amount of the foreign debt has been settled, has been determined, has been agreed upon by the Government of the United States and the foreign nations. It seems to me that the idea of hereafter considering the debts should not be entertained. We have had the question of the debts before us, we have debated it at length; and against the ideas of some of us who believe that the debts were fairly and honestly incurred and ought to be paid in full we have seen agreements approved between our Gov- ernment and other governments by which nearly the whole of the debt was forgiven, and now no payments are made on the settlements agreed to. As I understand it, the proposed amendment would apply to the nations which are in default. There has been no claim, so far as I know, that any of these agreements were made under duress, or were unfair. In round numbers we have forgiven about half the debts, and our taxpayers today are paying the debts of Europe. They are really repaying the money which the European nations borrowed from our Government. Mr. President, the debtor nations asked for the money they received; we did not force it upon them. When we came to settle, generously we took off one half of the debt, and our people have to pay the other half, and are pajring it now. In these times of depression this taxation, which has been placed upon the shoulders of the American people, has 1934 CONGRESSIONAL RECORD— SENATE 335 been Increased, and will continually be increased, by the amount of money which we forgave from debts which were fairly and honestly incurred. Now we are confronted with a proposal to levy a tax on spirituous liquors Imported from those countries greater than that levied on liquor from other goverrunents. Those governments could get rid of that tax by paying what they owed. They are not required to pay all the debts; they are required to pay only according to the very agreements which these different governments have made and have sanctioned. There would be no injustice in this. I do not suppose there would be this result, but suppose it did result in some of these govenmients not shipping us any whisky. The Ameri- can people are bright. If they will Just be patient, the American people will make their own champagne and make their own wine. Why this clamor that we must look after liquor first before we take up any other tariff problem? Copper has been mentioned, and as far as that is con- cerned, the problem is not a difficult one to solve. If the Senator from Arizona will offer his amendment, for one, I will vote for it. But the effort is to have this apply particu- larly to liquor, which we can get along without, and which we can produce ourselves, and get drunk on liquor we manu- facture ourselves. [Laughter.] The PRESIDING OFFICER. The question Is on agreeing to the amendment offered by the junior Senator from Mis- souri [Mr. Clark]. The yeas and nays have been ordered, and the clerk will call the roll. The legislative clerk proceeded to call the roU. Mr. BULOW (when his name was called). I have a pair with the senior Senator from New Jersey [Mr. Kean], who is absent. I therefore withhold my vote. Mr. McKELLAR (when his name was called) . On this vote I have a pair with the senior Senator from Delaware [Mr. Townsbnd]. Not knowing how he would vote, I withhold my vote. Mr. ROBINSON of Arkansas (when his name was called) . I have a general pair with the Senator from Pennsylvania [Mr. Reed], who is necessarily absent. Not knowing how he would vote pn this question. I transfer that pair to the Senator from Alabama [Mr. Black] and vote " nay." I am not advised as to how the Senator from Alabama would vote. Mr. TYDINGS (when his name was called) . On this vote I have a general pair with the senior Senator from Rhode Island [Mr. Metcalf], who is absent. I do not know how that Senator would vote if he were present. If I were per- mitted to vote, I should vote " nay." Mr. HEBERT. Mr. President, I desire to announce that the following Senators are necessarily absent: Mr. Gibson, Mr. Metcalf, Mr. Norbeck, Mr. Walcott, Mr. WnrrE, Mr. Kean, Mr. Townsend, and Mr. Reed. I also desire to announce that the Senator from Connec- ticut [Mr. Walcott] has a pair with the Senator from Colo- rado [Mr. Costigan]. I am not advised how either of these Senators would vote if present and voting. The Senator from West Virginia [Mr. Hatfield] is nec- essarily detained. If present, he would vote " 5^a." Mr. PATTERSON (after having voted in the affirmative) . I have a general pair with the Senator from New York [Mi. Wagner]. I am not advised how he would vote on this question and therefore transfer my pair to the Senator from West Virginia [Mr. Hatfield] and let my vote stand. Mr. LEWIS. I wish to announce that the Senator from Alabama [Mr. Black] and the Senator from Nevada [Mr. McCarran] are detained in an important committee meet- ing and are therefore unable to be present on this vote. I also wish to announce that the Senator from Colorado [Mr. Costigan] and the Senator from New York [Mr. Wag- ner] are necessarily absent on departmental business for their constituents. Mr. OVERTON. I wish to announce the necessary ab- sence of my colleague [Mr. Long]. The vote was recapitulated by the legislative clerk. Mr. HARRISON. Mr. President The PRESIDING OFFICER. On this question the yeas are 40. the nays are 39, so the amendment is agreed to. Mr. HARRISON. Mr. President. I was on my feet seeking recognition to ask for a recapitulation of the vote, it was so close. The PRESIDING OFFICER. Tbe clerk will again re- capitulate the vote. The vote was recapitulated. The result was announced — 3^eas 40, nays 39, as follows: YKAS— 40 Bachman Oopeland Hastings Wy« Barbour Davis Hebert Patterson Bone Dickinson Johnson Robinson. Ind Borah Dill La Follette RxisseU Brown Duffy LewU Schall Capper Srlcknnn IfcAdoo Shipstead Caraway Fess McOlU Stelwer Carey Prazler McNary Trammell Clark George Murphy Vandenberg Connally Goldsborough Norrls Wheeler NAYS— 39 Adams Couzens Keyes Robinson. Ark Ashurst Cutting King Sheppard Austin Dleterlch l4igan &nlth BaUey Fletcher lionergan Stephens Bankbead Glass Neely Thomas, Okla. Barkley Gore O'Mahoney Thomas. Utah Bulkley Hale Overton Thompson Brrd Harrison Plttman Van Nuys Byrnes Hatch Pope Walsh Coolldge Hayden Reynolds NOT VOTING— 17 Black Kean Norbeck Walcott Bulow Long Reed White Costigan IflcCarran Townsend 01bM>n ICcKeUar Tydlngs Hatfleld Metcalf Wagner So Mr. Clark's amendment , was agreed to as follows: On page 8. after line 17, Insert the foUowlng: "amc. 13. There shall be levied. coUected, and paid upon all wines and dlstUled spirits when Imported Into the United States or into any of Its possessions (except the PhUlpplne Islands, the Virgin Islands. American Samoa, and the Island of Guam), or when withdrawn from bond for consumption or use, If such wines or dlstlUed spirits are exported directly or indirectly from any foreign country which is in defaiUt on its national Indebtedness to the United States incurred in connection with the World War, the following duties, respectively: " On wines. $3 per gallon: on dlstUled splrlU. $5 per gallon. Such duties shaU be in addition to the duties prescribed under existing law, and the provisions of existing law (Including penal- ties) shall apply to the assessment and collection of such duties." Mr. COPELAND. Mr. President, I call the atteniion of the Senator in charge of the bill to page 5. the second paragraph. The matter involved here Is the question of the tax on artificially carbonated wines. A little while ago I made an appeal to the Senate that, in the interest of temperance and agriculture, there should be a lower tax upon light wine of an alcoholic content under 14 percent. I seemed to have no support from Senators from grape-growing States. There- fore I did not press the matter. I mention it now, however, because there is a larger group of Senators present. It certainly seems to me that in every State where grapes are grown commercially there should be an Interest in lower- ing the tax on this particular type of wine. If we are hoping to promote temperance, we want to make light wine as cheap as possible. If we are interested in agriculture, we want to help the grape grower. Every time a cent of tax is put on this light wine it means that a tax of $2 per ton is placed on grapes. A tax of 10 cents per gallon on light wine repre- sents a tax of $20 per ton on grapes. It seems to me that every Senator from a grape-growing State ought to be inter- ested in expressing some sentiment regarding this particular item. Mr. JOHNSON. Mr. President The VICE PRESIDENT. Does the Senator from New York yield to the Senator from California? Mr. COPELAND. I yield. Mr. JOHNSON. I Interrupt the Senator from New York because he made the statement that those from grape- growing States ought to be Interested In this Item. I am interested, I have been so Intensely Interested in the mat- ter that I have been canvassing the situation to see whether or not there could be a reduction In the tax upon wines of no higher degree of alcoholic content than 14 percent; but I met with so little acquiescence that I tluxight it was prob- 336 CONGRESSIONAL I lECORD— SEN ATE January 10 ably an impossible thing to attempt, so I have not at- tempted it. ^. . w *. w The Senator from New York is entirely right in what he is saying. The tax. of course, falls heavily upon agriculture, because wine-growing in vineyards is agriculture. Whisky can be watered, as the distillers are doing. The distillers can take 1 quart of whisky and make out of It 5 or 6 quarts of rotten, rotgut whisky, as they are doing today; and there Is not anything that will prevent them from doing It. and there is not anything that will diminish the profits they make. You cannot put water, however, into wine, except when you make vinegar. That is the difference between the ability to adulterate the one and the inability to adulterate the other. I am wholly in sympathy with the Senator's position, and I do not want his remarks to pass unnoticed l)ecause noth- ing has been done in that regard. The Senator may be aware that my colleague I Mr. McAdooI made an effort to get the reduction in the Finance Committee, and he was defeated by a vote of 11 to 7. Part of that vote possibly would not be with him if the same attempt wei e made upon the floor. It seemed a hopeless task to endeavor to reduce the tax rate on light wine to what we thought would be the comparative rate of tax. and for that reason I have not offered any amendment. Mr. COPELAND. I thank the Senator from California, but I still think that if the Senate understood what this means it would take action along the lines I suggest. If the contribution to the Government were a large sum. we would say. " Yes; we are glad to do this "; but the extreme amount of revenue to be derived as suggested by the Senator in charge of the bill is $7,000,000. My own flgures indi- cate $5,000,000; but if the tax were placed at 5 cents the Government would get half as much, anyway, and there would be a direct aid to agriculture in every grape-growing State in America. I was hoping that the Senator from Mississippi would be willing, since the bill must go to con- ference, to accept a lower rate, say. 5 cents a gallon, and then discuss it once more in the conference committee and see if there could not be a reduction in the tax upon wine of this character, because certainly it means much to agri- culture: it means much to my State and to the State so ably represented by both Senators from California. There are, however, other States in the Union, which are likewise interested, and my surprise has been that I have not had the enthusiastic support from different parts of the Union in the effort to do what seems to me to be so obviously our duty. Mr. BARKLEY. Mr. President, will the Senator yield? Mr. COPBLAND. I yield. Mr. BARKLEY. How many gallons of wine will a ton of grapes produce? Mr. COPELAND. It takes about frwn 13 to 16 pounds of grapes to make a gallon of wine. Mr. BARKLEY. Thirteen pounds? Mi, COPELAND. Prom 13 pounds to 18 pounds. Mr. BARKLEY. As a matter of fact. 5 quarts, I under- stand, are obtained from a gallon of wine; so that a tax (tf 10 cents a gallon as provided in the biU will result in a 2-cent tax on each quart bottle of wine that is consumed Does the Senator think that 2 cents a bottle is an exorbitant rate? Mr. COPELAND. It does not sound that way. but it does mean, in the aggregate, if the tax upon 14-percent wine M made 10 cents a gallon, a tax of from fifteen to seventeen and one half dollars on a ton of grapes. Mr. BARKLEY. Tliat is because a ton of grapes pro- duces such a large number of gallons of wine. I do nol suppose It Is a vital matter so f su* as the Treasury is con- cerned; but. in reply to the suggestion of the Senator fron California, who drew a comparison between wine and adul- terated whisky or distilled spirits, let me say that in thi^ bill there Is a difference between 10 cents a gaUon on win* and $3 « gallon on distilled spirits, so that there is no exactly a parallel. The consumer will never know any dif- ference, so far as the cost of a bottle of wine is concerned, whether the tax is 5 cents or 10 cents a gallon. Mr. COPELAND. I agree to that; but the producer will. Mr. BARBXEY. I doubt that, because I think, in all prob- ability, that the tax will be passed on. It docs not attach until after it leaves the producer of the grape, and it will attach then, if it attaches at all, to the producer, only to the extent of 2 cents a bottle on a quart of wine, or it will be ab- sorbed by those who produce the wine, who are not the grape growers according to my understanding. Mr. COPELAND. But, Mr. President, there is not any doubt at all that the producer will pay a tax of from $15 to $20 a ton as a consequence of the passage of this bill as it now stands. Mr. WALSH. Mr. President, cannot the same argument be made as to two other agricultural products, namely, com and barley, used in distilled spirits and beer? Can it not be claimed that the consumers arc taxed and that there is a burden placed upon agriculture when the tax upon a bu.shel of barley, which makes a barrel of beer, is $5. and the tax on a bushel of com is $9 when converted into the 4>2 gal- lons of whisky produced from com? Mr COPELAND. I do not quite see the force of that argument as applied here. The Senator from California has well stated it. So far as the consumer is concemed. he is going to get in the case of whisky— I hate to use the term, on account of the galleries— a concoction that, in my opinion, is scandalous. . , ,^ Mr. BARKLEY. Mr. President, will the Senator yield there? Mr. COPELAND. Yes. Mr. BARKLEY. I am interested to know what is the price of a ton of grapes out of which wine is made and on which the Senator says there will be imposed a tax of $20 a ton. What is the price of a ton of grapes? Mr. COPELAND. It depends upon the market. It would run from twenty to twenty-five, thirty-five, or forty dollars a ton. Mr. BARKLEY. Sold by the ton or by the pound? Mr. COPELAND. Perhaps I misspoke myself. It would run from thirty to thirty-five or forty dollars a ton, and under this bill the tax will come out of the producer of grapes. Mr. BARKLEY. If it is true that a ton of grapes made into wine brings only thirty to thirty-five dollars a ton. and if the tax of 2 cents a bottle would reflect upon the producer of grapes to the extent of $20 a ton, it would seem that somebody between the consumer and the grower is making an enormous profit by the manufacture and sale of wines, because $:?0 a ton, which the Senator says would be the tax on the grapes, amounts to a tax of 2 cents a bottle on wine. Mr. COPELAND. The Senator from California has de- scribed the reason for that. When whisky is made nobody gets any pure whisky. The sort of stuff that is sold in the drug stores as whisky is little short of a scandal. The sort of medicinal liquor that is sold is cut and recut; it is bright- ened up with coloring matter; it contains a lot of sherry; it contains a tremendous amount of grain alcohol; and by the time it gets to the consumer it contains water. He does not get any whisky in the sense that the Pharmacopoeia has described whisky. Likewise, in the making of beer. 90 per- cent of the beer is water; but when it comes to wine it is all grape juice; there is not any way to impose upon the public or to exploit the public. If the Members of the Sen- ate who believe in temperance and are distressed over the idea of what may happen when we have free and imlimited sale of whisky wish to promote the cause of temperance, they will be for a lower rate on light wines. Furthermore, if they are interested in agricvUture, they will want to help the grape grower. It was on this account that I rose, because a little while ago I was convinced that there is no sentiment in the Senate in favor of a proposal for the reduction of the tax on light wines. 1934 CONGRESSIONAL RECORD-SENATE 337 I wish, however, to ask the Senator in charge of the bill a question about a provision on page 5. The first paragraph reads that there shall be levied — On each bottle or other container of champagne or sparkling wine. 5 cents on each one-half pint or fraction thereof. Then, in the next paragraph, it is provided that there shall be levied — On each bottle or other container of artiflclallv carbonated wine. 2>/2 centa on each one-half pint or fraction thereof. Wine artificially carbonated is regarded often by the consumer as a champagne, as a sparkling wine, and the constuner gets no benefit. It is sold at the same price as is natural sparkling wine, and why should It not be taxed at the same rate? So, at the same time, I am a:iking for a reduc- tion of the tax on light natural wine ; I am asking why there should not be a higher tax on artificially carbonated wine. Mr. HARRISON. I do not know that I can give the Senator the reason why artificially carbonated wine is not taxed higher than the other variety, but the law has always distinguished between champagne and sparkling wine. The old law, under the champagne and sparkling-wine provision, provided a rate of 12 cents on each half pint. We make it 5 cents. On each bottle of artificially carbonated wine we make it 2!^ where it used to be 6 cents. We reduced both those rates. I do not know that I can give to the Senator the reasons why artificially carbonated wine should not bear a higher rate than the other, but it has never done so, and those who have studied the question have said it should not be so. I suppose that is the reason why we adopted the rate provided. Mr. COPELAND. That is, as it was in the beginning, is now, and ever shall be world without end. Of course, we are living in a time when we are setting aside old-time theories and practices, and now would be a good time to make the change. I think that artificially carbonated wine ought to be taxed at the same rate as natural sparkling wine. That is my judgment. I am not going to press either one of these matters, be- cause we seem inchned in the matter of rates to follow the committee, but I do think that Senators from other grape- gi'owing States should be sufficiently interested to give some, moral support to the suggestions which I have made. Mr. BARKLEY. Mr. President, will the Senator yield there? The PRESIDING OFFICER (Mr. Hayden in the chair). Does the Senator from New York yield to the Senator from Kentucky? Mr. COPELAND. I yield. Mr. BARKLEY. I do not care to prolong the discussion, but just as a matter of interest, I have been calculating what the net result of this tax will be. Mr. COPELAND. That is on artificially carbonated wine? Mr. BARKLEY, No; I am referring to the wine tax. Two thousand pounds of grapes, representing a ton, will produce 155 gallons of wine. At 10 cents a gallon, the tax on this product of a ton of grapes is $15.50. That 155 gal- lons of grape wine, though, to the consumer, brings $1,245. Mr. COPELAND. At what price is that? Mr. BARKLEY. At an average of $1.50 a quart it would be $7.50 to the wine gallon. Mr. COPELAND. One dollar and fifty cents a quart for natural light wine? Mr. BARKLEY. That is a fair average according to a statement made to the Finance Committee a few days ago. Some of it sells for less and some for considerably more. Mr. COPELAND. My own familiarity with wine cards, reading them as a matter of scholarly interest, would indi- cate to me that light American wines would never seU for $1.50 a quart. Mr. BARKLEY. My recollection is that it was stated to the committee a few days ago that $1.50 is a fair average retail price for these wines. Frankly, I do not know from personal knowledge what the charge is for this particular type of wine; but even if we might assume that to be a dollar instead of $1.50, the price paid by the consiuner for these wines is much larger than at first blush might be con- sidered as the financial result of the growth of a ton of grapes. It seems to me this tax of $15.50 upon the result of the fermentation of wine is so insignificant that a reduction to 5 or 7^ cents would never be felt by the consumer and could not be refiected upon the grower In any serious way. Mr. COPELAND. I know how sincere my friend it. I know what his attitude has been toward intemperance. We have now, with the repeal of prohibition, a new set of con- ditions in the United SUtes. I think everybody that has given it any thought realizes that unless common sense shall be exercised by those who deal In this traffic there will be • renewed sentiment for further legislation. Unciuestionably there will be an effort made to promote temperance by an urgent appeal to the people to drink light wines. In mjr opinion, there ought to be such an appeal. If I know any- thing about the human body and the effect of alcohol upon it, I would say that if one must take alcoholic liquor of any sort, he Is far wiser and more likely to protect his health and prolong his life If he takes light wine. From my standpoint, I would say that we ought In every way possible to encour- age the drinking of light wines and to that end make their price as low as possible. I know as well as I can know without being an expert on the subject that the tax on light wine will be refiected upon the producer of grapes. If the rate Is fixed at 10 cents m gallon it will mean a tax upon the grower of grapes of from $15 to $18 per ton. The PRESIDINa OFFICER. Are there any further amendments? There being no further amendments the question is. Shall the amendments be engrossed and the bill be read a third time? The amendments were ordered to be engrossed and the bill to be read a third time. The bill was read the third time. The PRESIDING OFFICER. The question Is, Shall the bill pass? The bill was passed. Mr. HARRISON. I move that the Senate insist upon Its amendments, ask for a conference with the House, and that the conferees on the part of the Senate be named by the Presiding Officer. The motion was agreed to; and the Presiding Officer ap- pointed Mr. Harrison, Mr. King, Mr. George. Mr. Reed, and Mr. Couzens conferees on the part of the Senate. Mr. HARRISON. I ask unanimous consent that the bill just passed may be printed with the amendments adopted by the Senate numbered. The PRESIDING OFFICER, Without objection. It Is so ordered. CALL OF THE ROLL Mr. DICKINSON obtained the floor. Mr. HARRISON. Mr. President, before the Senator pro- ceeds, may I say that I promised the Senator from Arkansas [Mr. Robinson] that when the bill was passed I would sug- gest the absence of a quonmi. Will the Senator yield to me for that purpose at this time? Mr. DICKINSON. I yield for that purpose. Mr. HARRISON. I suggest the absence of a quorum. The PRESIDING OFFICER. The clerk will call the roll. The Chief Clerk called the roll, and the following Senaton answered to their names: Adams Ashurst Austin Bachman Bailey Bankhead Barboxir Barkley Black Bone Borah Brown Bulkier Bulow Byrd Byrnes Capper Caraway Carey Clark Connally Coolidge Copeland Costlgan Oouzens Cutting Davis Dickinson Dleterlch DUl Duffy Erlckson Fess Fletcher Prazier Oeorg* Glass Ooldsborough Gore Bale Barrlson Hastings Batch Hatfield Hayden Hebert Johnson Keyes King La Pollette Lewis Logan Lonergan McAdoo IfcOarraa McOUl McKellar IfCeMary Murphy Neely Norrts Nye Ollaboncqr Overton Patterson Ptttmau Pope Reed Reynolds Robinson. Aik. Robinson. lad. BusseU Lxxvni- -22 338 CONGRESSIONAL RECORD— SENATE January 10 Van Nuys Wagner WaUb Wheeler Schall Btelwer Thoinpson Sheppard Stephens Trammell ShIpsUAd Thomas. Ok'.a. Tydlngs Smith Thomas. Utah Vandenberg Mr. OVERTON. I desire to announce that my ortleague the senior Senator from Louisiana [Mr. Lowg] is neces- sarily detained from the Senate. The VICE PRESIDENT. Eighty-eight Senators have an- swered to their names. A quonmi is present. OIBAT LAKXS-ST. LAWRENCB DEKP WATMWAY T«ATY (SJKK. NO. 110) The VICE PRESIDENT laid before the Senate a message from the President of the United SUtes, which was read, as follows: To the Senate: I request the consideration of ratification by the Senate of the so-called "St. Lawrence Treaty with Canada." Broad national reasons lead me. without hesitation, to advocate the treaty. There are two main considerations — navigation and power. Canada and the United States are possessed of a nattu^l flow of water from near the center of the continent to the ocean — a flow which throughout the greater part of its length is today available for navigation by large-size vessels. A system of locks at the eastern end of Lake Superior, a dredged channel between Lake Huron and Lake Erie, and another series of great locks between Lake Erie and Lake Ontario provide free and adequate navigation to a point well down the St. Lawrence River. Prom there a series of three raiMs. all of tbem within a distance of 120 miles, now Impede navigation by ocean-going vessels; but a Canadian canal ah-eady provides facilities for smaller dilpe. This <>ftiiai^«an canal now Is used substantially up to its capacity --. Two of the three rapids are wholly in Canadian territory, 'the other U in the so-called "international section." A great power development at the Beauhamols Rapids in Canada is already nearlng completion, and locks for ocean- "igolng ships have been planned for and could readily be built at a low cost as part of the plan. This means that only two additional series of locks are required for a complete and continuous seaway from Duluth to salt water. I call your attention to the simple fact that Canada alone can. If de- sired, build locks at the Lachlne Rapids and at the inter- national sector, and thus provide a seaway wholly within Canadian control without treaty participation by the United States. This, however, would be a reversal of the policy of cooperation which the United BUtes and Canada navs contlnuotisly maintained for generations. I want to make it very clear that this great international highway for shipping is without any question going to be completed in the near future, and that this completion •t^ould be carried out by both nations instead of by one. I am sending you herewith a summary of data prepared at my request by governmental agencies. This summary, in Its relation to the economic aspects of the seaway, shows from the broad national point of view, first, that commerc* and transportation will be greatly benefited and. secondly, local fears of economic harm to special localities or to spe- cial interests are grossly exaggerated. It is, I believe, a his- toric fact that every great improvement directed to better commercial communications, whether in the case of rail- roads into new territory, or the deepening of great rivers or the building of canals, or even the cutting of the Isthmuj of Panama, have all been subjected to opposition on the pcur1 of local interests which conjure up Imaginary fears and fai to realise that improved transportation results in Increasec commerce benefiting directly or indirectly all sections. For example. I am convinced that the building of the St Lawrence seaway will not injure the railroads or thro^ their employees out of work; that it will not in any waj interfere with the proper use of the Mississippi River oi the Missouri River for navigation. Let us be wholly frani in saying that it is better economics to send grain or oth© raw materials from our Northwest to Europe via the Grea! Lakes and St. Lawrence than it is to send them aroimd thre< sides of a square— via Texas ports or the Mississippi, thfcno through the Gulf of Mexico, and thence from the southern end of the North Atlantic to its northern end. In this U- lustration. it is well to remember that a straight line is the shortest distance between two points. I am satisfied that the treaty contains adequate provision for the needs of the Chicago Drainage District and for navi- gation between Lake Michigan and the Mississippi River. A special report from the Chief of Engineers of the War Department covers this subject. On the affirmative side. I subscribe to the definite belief that the completion of the seaway will greatly sene the economic and transportation needs of a vast area of the United States and should, therefore, be considered solely from the national point of view. The other great objective provided for in the treaty relates to the development of electric power. As you know. I have advocated the development of four great power areas in the United States, each to serve as a yardstick and each to be controlled by Government or governmental agencies. The Tennessee Valley plants and projects in the Southeast, the Boulder Dam on the Colorado River in the Southwest, the Columbia RJVer projects in the Northwest are already under construction. The St. Lawrence development in the Northeast calls for action. This river is a source of incomparably cheap power located in proximity to a great industrial and rural market and within transmission distance of millions of domestic consiuners. The Legislature of the State of New York, by unanimous vote, set up the necessary State machinery during my term as Governor of New York, and the State stands ready to cooperate with the Federal Government in the distribution of power in accordance with what I believe is today a definite national policy. Power in the international sector of the St. Lawrence cannot be developed without a treaty between the United States and Canada. On the other hand, Canada can develop a huge block of new power at the two other rapids, which lie whoUy within Canadian territory. Here again, as In the ease of navigation, It is better in every way that we should maintain the historic principle of accord with Canada in the mutual developi^ent of the two Nations. Z have not stressed the fact that the starting of this great work win put thousands of unemployed to work, I have preferred to stress the great future advantage)! to our coun- try, and especially the fact that all of us Nhould view this treaty In the light of the benefits which It confers on the people of the United States as a whole. Franklin D. Rooskvklt, Thi White House, January 10. 19U. Mr. PITTMAN. Mr, President, I ask that the message, together with the accompanying data and Illustrations, lie on the table and be printed as a Senate document for the information of the Senate. The VICE PRESIDENT. Is there objection? The Chair hears none, and it is so ordered. OROEB or BUSINESS Mr. DICKINSON obtained the fioor. Mr. ROBINSON of Arkansas. Mr. President The VICE PRESIDENT. Does the Senator from Iowa yield to the Senator from Arkansas? Mr. DICKINSON. I do. Mr. ROBINSON of Arkansas. I rise to a parliamentary inquiry. There was an agreement to proceed to the consideration of the Calendar for Unobjected Bills at the conclusion of the consideration of the liquor-tax bill. I presume that order may be renewed tomorrow, if it is desired, and the Senator may go on with his address. I understand his address will consimie perhaps the remainder of the afternoon. Mr. DICKINSON. Not over 30 minutes. Mr. McNARY. Mr. President The VICE PRESIDENT. Does the Senator from Iowa yield to the Senator from Oregon? Mr. DICKINSON. I yield. 1934 CONGRESSIONAL RECORD— SENATE 339 Mr. McNARY. I desire to state to the Senator from Arkan-sas that I asked for that consent, which he so readily granted, on account of the request made to me by the Sen- ator from California [Mr. Johnson]. In his absence I should not want to alter the agreement. Mr. ROBINSON of Arkansas. Very well. Mr. LEWIS. Mr. President, may I ask the Senator from Iowa if he will allow me to propound an interrogatory to the Senator from Arkansas as leader? Mr. DICKINSON. I yield for that purpose. Mr. LEWIS. Mr. President, I address myself to the Sen- ator from Arkansas and ask if there is any arrangement or suggestion of any immediate vote touching the question of the treaty that has just been presented in the message of the President? Mr. ROBINSON of Arkansas. I do not expect any action to be taken on the treaty this afternoon. Mr. LEWIS. I thank the Senator. GOVERNMENTAL EXPENDITURES Mr. DICKINSON. Mr. President, the latter part of the Budget message of the President of the United States the other day contained an assurance to the country that the emergency expenditures in the various new bureaus of the Government were to be audited by the Budget Director and by the Comptroller. I think it was an assurance that we were at least to see where the money was going, regardless of whether we got value received or not. I desire to read from that message, as printed under date of January 4, on page 32 of the Record. The President stated: Up to now tliere haa been no coordinated control over emer- gency expenditures. Today, by Executive order. I have imposed that necessary control In the Bureau of the Budget. Hprctofore, emergency expenrtiture-i have net been subject to audit by the Comptroller General of the General Accounting Office. Today I am. by Executive order, reposing In him the authority to conduct such an audit and to continue to audit each Kuch expenditure, nereafter, therefore, just as In the de- partmental expenditures, there will be. In emergency expendi- tures, ft pre-Budget and a po«t audit. By roaton of the fact that the Bureau of the Budget has had no control In the past over the various expcndlt\ires, obllKatlons. and nlintments made by the emcrKenry orRiini/rtlons. the ta;4k of prrpurinB the present Budget has been the mowt dlfflcult one since the Budget and AccountlnK Act went Into eflect In IMl. These dimcultlee, in future years, will be substantially mlnlmliied by the control which I have established. Mr. President, very much to the »urprl»« of everyone, that order remained In effect 72 hour* nnd wa« then BUpplanted by u:i order in t«rmii like those of the rcr»olutlon I pic- »enle<-l here thU morning, under which none of the»e ac- count.1 are to be audited by the Budget, under which there is simply to be a report from each one of these emergency bureaus to the Budget Director. My resolution, to which these remarks will be addressed, asks that these emergency bureaus, administrations, and so forth, forward to the Secretary of the Senate exact copies of the data filed with the Budget Director. Of course, the only result of compliance would be that we would get information, but with the information we would at least have some idea as to where the money under these emergency expenditures is going. I think that in order that the Senate may understand the full effect of this order I will read from Arth;ir Krock's article in the New York Times of January 8: Efforts are being made, and will be made, to minimize the cause and effect of the President's substitution of a new Execu- tive order today for that of January 3, which gave to Budget Director Douglas the power to audit the emergency Budget. But the plain fact is that those In the administration who are committed to the policy of spending for recovery without check banded themselves together and persuaded the President to change his prudent plan. ^ _. Mr. Douglas* audit powers lasted about 3 days. They were suggested by Treasury officials, who are peculiarly aware of the fact that before a government can have a financing policy It must have a fiscal policy. The way to have a fiscal policy is to lodge a certain amount of supervision over emergency expendi- tures in the hands of an official. To the Treasury heads and to the President Mr. Douglas seemed precisely that official. The terms of the first Executive order became known to the spending group last Friday morning. Secretary Ickes, Administra- tor Hopkins, and AsslsUnt Secretary of Agriculture Tugwell wn m no doubt as to Its force and meaning. The order w» u tight as Mr. Douglas, whom the President had asked to diaw It, could make It. But accompanying the order were " waver " forma which permitted responsible officials safely to contract necessary emergency obligation, growing out of fixed policy, and guaranteed commitments they might have made before the lesuance of the Executive order. Strange as it may seem, after these visits to the White House, the President canceled the former order, which lasted. as I have said, but 72 hours, and made a new Executive order. This is a description by Mr. EIrock of the new Execu- tive order: The new Executive order directs aU agencies of the Oovemment to submit weekly Itemired reports of aU emergency expenditures, and weekly reports also of all contracts made. The Director of the Budget Is to be furnished with these reports and is authorlaed to make comment and recommendations thereupon. Theee com- ments and recommendations he can send to the President. The difference in the two orders "la fundamental. With the exception of the detailed weekly reports, unrestricted spending power is back in the hands of those who are committed to spend- ing. They are to be responsible for their spending to the Presi- dent. But that has always been the case. The only gain in the comedy of the noble 72-hovu- gesture is that Mr. Douglas and Comptroller General McCarl will know more quickly what horses and how many have been taken from the bam. After the fact they can point out vigorously whether or not they think the horses were taken too fast. The President, obviously responsive to argument — as this whole incident proves — can get a clearer idea of the spending methods of his associates. Mr. FESS. Mr. President The PRESIDING OFFICER (Mr. Austin In the chair). Does the Senator from Iowa yield to the Senator from Ohio? Mr. DICKINSON. I yield. Mr. FESS. As I understood the Senator's reading, a statement of the expenditure is to be reported back to the Budget Director, but after the expenditure is made? Mr. DICKINSON. That is it exactly. Mr, FESS. Why should a report be sent to him after the expenditure is made? Mr. DICKINSON. I presume simply for comment which he might make to the President, or to someone else to whom he ml»ht desire to send the information. We all know that If there Is authority to spend, and the only thing the par- ticular bureau has to do Is to report it, the chance of having someone make serious objection to an expenditure after It U already made Is remote. As a matter of fact, the whole purpose of the original order was to have an audit, to se« thot the authorization was legal, that It was authorlaed under the law, before the money passed out of the Treasury. Mr. FESS. In other words, it was an effort to keep direc- tion m the proper authority over the expenditure of the money? Mr. DICKINSON, That U exactly true. Mr. FESS. A thing which I think was applauded all over the United States. Mr. DICKINSON. I want to suggest this to the Senator from Ohio. We can go to many of these emergency organi- zations now and come away with an authorization of $10,000,000 in a few minutes* time, but if we want a nickel's worth of information, we cannot get it in a month. I have been trying in vain for that length of time to get informa- tion from a number of them. The thing I am trying to set forth here Is what was done in the cancelation of this first order. Mr. Krock says further: I Member-? of the " brain trust " charge that the Director is out of svmnathv with the Surplus Relief Corporation, that mysterious agency with incredibly vast powers organized in Delaware as * prl- vlte corporation by Mr. Hopkins and Secretaries Ickes and V7al- lace If that is true, then he would have held up the proposed exnenditure by the Corporation of $50,000,000 to purchase sub- ! marelnal lands, asking for a statement as to powers, policies, and ' immediate plans. The fruits of that Investigation might have been rich from the viewpoint of the taxpayers and might even have nrovided news for the President and Congress. Under the new order the Corporation can go ahead with P.WJV. money— and then report that It has been spent! There is the crux of the whole thing. S40 CONGRESSIONAL ] RECORD— SENATE This morning I find an editorial in the Washington Post which. I think, sets forth the question I am discussing. It reads: withdrawal of the order which gave the Budget B\ireau a check on emergency expenditures Is a slgnlflcant victory for those offlclals who believe In unrestrained spending for recovery pur- poses The Issue waa clearly drawn In President Roosevelt s Budget meaaage. He Informed Congresa that control over emer- gency expenditures had been lacking and that he had " Imposed that necessary control In the Bureau of the Budget." But the control remained In effect for only 8 days. President EiooMvelt'B aubetitute order is a sharp reversal of the policy announced In his Budget message. Instead of check- ing the expenditures of the emergency organizations before they arc made, the Director of the Budget wUl merely receive weekly ■tatementa showing the allocation of funds and obligations In- curred by tlie P.WA.. C.W Ji., etc. If he has any complaint to make. It can be carried to the President — after the money has been ■pent. In other words. Lewis Douglaa may alam the door as vlgorovisly u he pleases as each horse disappears around the comer. As a matter of fact, we know that an official of the Gov- ernment will not make any such complaint. As a matter of fact, he will get the information. a*id he may say that he disapproves of some of it, but in the end he will make no official con the board of directors by the statutes of the State of Delaware and this certificate of incorporation, the board of directors shall have such powers as the bylaws of the Corixjratlon may from time to time confer upon them. The power to make, alter, and amend the bylaws of the Corpora- tion shall be in the members of the Corporation. A majority of the directors in office at any time shall constitute a quorum for the transaction of business, unless the bylaws of the Corporation shall provide that a different number shall constitute a quorum, but In no case shall a quorum be less than one third of the total number of directors provided for by the bylaws, nor less than two. The voting powers of all members of the Corporation shall be equal. Each member shall be entitled to one vote on any and all questions coming before the members. Any member entitled to vote at any meeting of the members may be represented and vote by proxy. All action taken by the members of the Corporation shall be by majority vote. A certificate of membership shall be Issued to each member. No membership or certificate of member- ship shall be transferable save to the successor of such member In the office specified in paragraph 4 hereof, and no assignee or transferee thereof, whether by operation of law or otherwise, shall be entitled to membership In this Corporation or to any property, rights, or Interest therein, unless such assignee or transferee shall be the successor In office as aforesaid of such member. All the books, records, papers, vouchers, and documents of this Corporation shall, at all reasonable times, be open to the inspection of e£w:h member of the Corporation or to his duly constituted agent or representative. The members and board of directors of this Corporation may hold their meetings, and have an office or offices, outside the State of Delaware, and keep the books of this Corporation (subject to the provisions of the statutes of Delaware) outside the State of Delaware at such place or places as may be from time to time designated by the members of the Corporation. If. as. and when in the Judgnient of the members of the Cor- poration the objects and purposes of this Corporation shall be accomplished and attained, or in the event of the dissolution of the Corporation, the members of the Corporation shall cau.se all the assets of the Corporation, other than money, to be sold In such manner and such time or times as the members of the Corpora- tion shall deem best to promote the public welfare, and shall pay the proceeds of such sale or sales, together with all other moneys remaining in the hands of the Corporation after the payment of its debts and expenses. Into the Treasury of the United States for such uses and purposes as may be provided by statute. Ninth. The Corporation reserves the right to amend, alter, change, or repeal any provision contained in this certificate of incorporation in the manner now or hereafter provided by statute. and all rights conferred upon the members of the Corporation are granted subject to this reservation, with the exception, however, that no such amendment, alteration, change, or repeal shall be made which would so change the objects and purposes as to per- mit the net income of the Corporation, or any part thereof, to In- xire to the benefit of any private Individual or member of the Corporation. We. the undersigned, being each of the original Incorporators hereinbefore named, for the purpose of forming a corporation to carry on its activlUes. both within and without the State of Dela- ware, and In pursuance of the general corpxjratlon law of the State of Delaware and the acts amendatory thereof and supplemental thereto, do make' and file this certificate, hereby declaring and 1934 CONGRESSIONAL RECORD— SENATE 341 certifying that the facts herein stated are true, and accordingly have hereunto set otir hands and seals this 4th day of October, AJD. 1933. H. A. Wallace. [seal] Harold L. Ickes. |seal| Harht L. Hopkins, [skal] In the presence of — Lex Pkkssman, As to All. DisraicT or Colttmbia, aa: Be It remembered that on this 4th day of October. AD. 1933. per- sonally appeared before me. the subscriber, a notary public In and for the District of Columbia, Henry A. Wallace, Harold L. Ickes, and Harry L. Hopkins, being all of the parties to the fore- going certificate of Incorporation, known to me personally to be such, and severally acknowledged the said certificate to be their act and deed and that the facts therein stated are truly set forth. Given under my hand and seal of office the day and year aforesaid. [SEAL] . W. E. Tatlor, Notary Public. Statz or Delaware. OmcE or Secretart or State. I. Charles H. Qrantland. secretary of state of the State of Dela- ware, do hereby certify that the above and foregoing Is a true and correct copy of certificate of incorporation of " Federal Siu'plus Relief Corporation," as received and filed in this office the 4th day of October. A.D. 1933. at 5 o'clock p.m. In testimony whereof. I have hereunto set my hand and of- ficial seal at Dover this 4th day of October. A.D. 1933. [SEAL] Charles H. GaANTLAim, Secretary of State. Mr. DICKINSON. Mr. President, in order to understand just what this Corporation is authorized to do, I hope the Members of the Senate will read in the Record tomorrow morning the powers granted the organization. They are very far-reaching. They can go into business in practically every line of endeavor in the United States. The only thing which now seems to be proiposed is that they ought to spend some $50,000,000 in purchasing marginal lands. I have gone through the three acts which are the basis for the formation of this Corpoi-ation. and I can find no- where in them any authorization for the purchase of mar- ginal lands, or any other kind of lands, for the purposes set forth. In other words, if we buy land for a conservation corps, we buy land for a certain purpose, but there is noth- ing in the authorization which will permit anyone to bUy land and take it out of production, acreage which is to pro- duce crops. In other words, the purpose of these various organizations is clearly set forth. The Conservation Corps was formed with a certain purpose in mind. But when we go into the matter of the Agricultural Adjustment Act, under the A.A.A., then, if we buy land, we must buy it and be authorized to buy it for the very purpose of taking it out of cultivation. There is no such authorization any- where in any of these laws. I go back to the Agricultural Adjustment Act, title I, page 4, part 2, section 8 — To provide for reduction In the acreage or reduction In the pro- duction for market, or both, of any basic agricultural commodity, through agreements with producers or by other voluntary methods, and to provide for rental or benefit payments in connection there- with or upon that part of the production of any basic agricul- tural commodity required for domestic consumption. In such amounts as the Secretary deems fair and reasonable, to be paid out of any moneys available for such payments. There is nothing there that would permit one to do other than enrich land; nothing that would permit one to take it out of cultivation. There is nothing there which says that one can buy land in order to take it out of cultivation. Mr. President, I go back to the Industrial Recovery Act. These acts were so interwoven that it is very difficult some- times to follow them. In section 202. page 8. this language occurs: The Administrator, under the direction of the President, shall prepare a comprehensive program of public works, which shall include among other things the following: (a) Construction, repair, and Improvement of public highways and parkways, public buildings, and any publicly owned instrumentalities and facilities; (b) conservation and development of natural resources, including control, utilization, and purification of waters, prevention of soil or coastal erosion, development of water power, transmission of electrical energy, and construction of river and harbor Improve- ments and flood control and also the construction of any river or drainage Improvement. What I want to suggest Is that these people have taken to themselves an authority which is not impUed In this law; and if they are going to make these purchases and pay for them before anybody has a right to audit their accounts, all they have to do is to submit a pr(HX)sed piurchase to some attorney, who will say. " Yes; you can buy this land. Oo ahead and spend $50,000,000." I admit that under the present process of apendlng. $50.- 000.000 is mere pocket change, that it doee not amount to anything; but we ought to know they are spending it ac- cording to law, at least. There was never any diacuaaion tn Congress, when the Agricultural Adjustment Act was before Congress, on the question of whether or not the adminis- tration would have any right to buy marginal lands to take them out of cultivation. That was not discussed in any report I have seen. I do not believe It was ever within the mind of Congress in any way. I find in connection with House bill 3835, the Agricul- tural Adjustment Act. that the House committee made a report when the bill was reported for passage. Permit me to read from page 3 of that repwt the following: In order to Induce producers to bring about such reductions. the Secretary Is authorized to rent acreage taken out of produc- tion, or to pay benefits to the producer to compensate him for his decrease In production. Such rentals and benefit payments are to be fair and reasonable and to be made with due regard to effectuating the declared policy of giving to the producer grad- ually a return for those commodities covered by the bill equiva- lent to their pre-war purchasing power. The rental and benefit payments are to be paid from appropriations from the Treastiry. The bill, however, makes provision for raising additional revenues for the Treasury that It Is believed will more than equal any expendlttu'es resulting from operation of the act. That reference, of course, is the processing tax. There is nothing in the act even hinting that we had a right to buy marginal lands. Yet what do we find? We find that this Corporation, organized in Delaware, is proposing to spend $50,000,000 to buy marginal lands to take them out of production. As to whether this is right or wrong, I am not committing myself; but I do wish to say that if it is not authorized under the law, nobody in the various emergency organiza- tions ought to want to attempt to do it; and they ought to be at least willing that some official of the Government have some supervision over the expenditure of this money, and know that it is being spent according to the terms of the law. Mr. CONNALLY. Mr. President The PRESIDING OFFICER. Does the Senator from Iowa yield to the Senator from Texas? Mr. DICKINSON. I yield. Mr. CONNALLY. The Senator from Iowa just made the statement that some Government official ought to have supervision. Have not some Government officials supervision of all of these expenditures n^? Mr. DICKINSON. Yes; the^inan who is spending the money is supervising the whole business. Mr. CONNALLY. Certainly. Does the Senator want someone else, who is not spending the money, to have super- vision? Mr. DICKINSON. The President says it Is necessary. I am agreeing with him. I think it ought to be to my credit to agree with the President once. Mr. CONNALLY. I think it is very much to the Senator's credit. The more the Senator agrees with him, the more credit the Senator will have in the country. Mr. DICKINSON. That is very kind of the Senator frwn Texas; but I wish to state that the trouble was that some of the' administrators convinced the President that he ought to reverse his position. I think in reversing his position he did the wrong thing. In order that the Senate may understand something about these expenditures, I desire to suggest that the Federal Emergency Administration of Pubhc Works has issued a re- port under date of December 23. 1933, and in that report we find the various authorizations and expenditures. For example, there is the Civil Works Administration, $400,000,- ^42 CONGRESSIONAL ] RECORD— SEN ATE 000; Public Worts Emergency Housing Corporatkm, $100,- 000.000; and so forth. The thing which I think ought to be given consideration Is that on page 4 of the report we find that the allotments are being made by the PubUc Works Administration, and they are being made for projects that Congress has turned down time and time again — items that are familiar to every man who has been on the Appropriations Committee in the House of Representatiyes. They have been turned down there docens of times; and yet under this law, with the authority that is granted, they not only supplement the regular appro- priation for i^actlciaiy all of the variouB branches of the Oovemment but they include various iH-ojects which time and time again the Appropriations Committee and the Mem- bers of Congress have turned dofwn as being unworthy. I am not alone in making this statemmt. The criticism was started in the House Appropriations Committee by my good ftlend. Mr. Buchanah, of Texas, one of the best legis- lators in the House of Representatives. We served together on the same stdx:(»nmittee for a niunber of years. He sas^ that such things should not be permitted, and some restrlc- tiOD should be imposed upon the men who have these vast sums of money to expend. Turning to page 4 of this report I find the following: T%rm Credit Admlnlatntion. $100,000,000. TZiat is statutory. Tennefe Valley Authority. iSO.OOO.OOO. Hlghwajs (statutory). MOO.OOC.OOO. Raval construction, (338.000.000. It is an old story that the Navy has needed a great deal of money. I do not think people are objecting to that. The question is, however, whether or not the nvunber of men the Navy can employ and the necessity of the occasion warrant us in borrowing at the expense of the taxpayer the money necessary to make all this expenditure at one time. The Public Works Administration is doing that very thing. Rational Recovery AdixUnlstratlon. •4.125.000. ClvUlan Conacrvatlon Corps (Executive order) , purchase of lazkl, 9aajooojooo. I can recall very well that in the expansion of our park agrstem and in the expansion of the various other types of land utillsatian we have been carrying out a policy of buying land very cautiously for a great many years; but we find here that, regardless of the caution that has heretofore been exercised, they are allocating $20,000,000 to the Civilian Conservation Corps to go out and buy such land as they want. civilian conservation Corps, other expenses, $301,000,000. OrMi Smoky National Park. $1,560,000. NaUonal Labor Board, $500,000. We now come to the Department of Agriculture. Let me say that I hope I am somewhat familiar with a number of these items, because I was on the Appropriations Committee handling this particular bill for a number of years. Agrlciiltural engineering. $281,538. Animal Industry, $1J»7 1,000. I am going to put this entire list into the Rxcori). There- fore, I win xx)t read all of the items. Dairy Industry. $173,000. Forest highways, $15,000,000. Forest roads and trails. $10,000,000. Plant industry, $3,481,000. Plant quarantine. $2,000,000. Forest Service. $1&.M2.000. T^ie Senate win see that labor was employed; that material was bought; but in the purchase of material and in the oniriayment of labor in these various lines of ^ideavor it iniist be remembered that a very high price for sustenance Is being paid to those who need employment. I am not oliifecting to any of these items on the ground that labor la behag employed; but if labor is being employed at an ex- pense to the taxpayer of this country which 1$ far beyond any TeasonaUe expenditure, when we have to barrow the Bumey with whiefa to do it, and when we are running a defleit of f7.00O.00O4MW. it seems to me that we ahoold at least atop^ look, and listen before we expand all these January 10 projects that are old and worn out and many of them ccaisidered more or less antiquated. With respect to the Commerce Department, I find the following : Aeronautics. $2,558,000. Lighthouses, $5,538,000. We then come to the Department of the Interior, and here is the list: Roads and trails. $24,680,000. Boulder Canyon, $38,000,000. I do not know how many of these projects are worthy, but here is a list of a number of them: Parker-Glla project. $100,000. AU-American Canal. $6,000,000. Verde River project. $4,000,000. Vale project. $1,000,000. Irrigation (projects bringing no new land under cultivation), $18,140,000. Mr. President, I thought the only purpose in having an irrigation project was to bring land into cultivation. I wonder what in the world an irrigation project is for if it is not to bring land into cultivation. We tJien come to another new one: Subsistence homesteads. $25,000,000. I have tried to ascertain where in the law there is au- thorization to buy land. The authorization is given to cooperate. There is an authorization, if you please, to make loans; but I do not believe there is any authorization exist- ing in the law permitting the bujang of land. What I have in mind, Mr. President, is that the Govern- ment is going to find itself in a hundred and one difficulties that it never dreamed of when it started on this program, I because we know what tremendous difficulty we had in trying to liquidate the enterprises that were entered into during the war period. It was a serious and far-reaching problem; we had housing corporations, and so forth, that we could not get rid of, and we were unable to dispose of them for years and years. Mr. President, I ask permission to insert in the Record as a part of my remarks the complete allocations, beginning with the allotment of Federal agencies on page 4, the De- partment of Agriculture, the Department of Commerce, the Interior Department, the Department of Justice, the De-r partment of Labor, tlie Post Office Department, the State ^Department, the Treasury Department, and the War De- partment. The PRESIDING OFFICER. Without objection, it is so ordered. The matter referred to is as follows: The non-Pederal allotments Include those made to railroads, designed to aid the heavy industries and at the same time in- crease employn^nt. To date railroad allotments eunount to $182,808,000. This includes $51,000,000 for rails and fastenings and $131,808,000 to nine railroads for new equipment, repairs to equipment, etc. AU allotments from the fxxnd were made public In detail when the allotments were made. Up until December 20 P.W-.\. had sent to applicants 587 con- tracts covering non-Federal projects for which allotments have been made. In addition to the Federal projects and roads ap- proved EUlotments have been made for about 1,20Q non-Federal projects which are listed herewith. Allotments to Federal agendee Farm Credit Administration (statutory) Tennessee Valley Authority (statutory) Highways (agriculture) (statutory for all States) Naval construction (Executive order) National Recovery Administration (administrative) _ Civilian Conservation Corps (Executive order) pur- chase of land ClvUlan Conservation Corps (estimated anticipated expenses) Great Smoky National Park (Executive order) National Labor Board Dtpariment of Agriculture Secretary of Agriculture (Department of Agriculture Building) Agrlculttira] engineering . Animal Industry Chemistry and Soils Dairy Industry Xntomology » >100 000.000 50 000,000 400 000.000 238 000.000 4, 250.000 20 000.000 301, 037.316 1, 550.000 500,000 2,718 281,538 1 571,240 103.919 173. 670 153,650 ■ V^'V^T A T ITTl'^T A _-. 4 A 1934 CONGRESSIONAL RECORD— SENATE 313 Department of Agriculture — Continued Experiment stations $4,950 Food and Drug Administration 70,000 Forest highways 15,000,000 Forest roads and trails 10.000,000 Plant Industry (physical improvements) 3,481,557 Plant Indtistry (erosion-control nurseries) 630.000 Plant Quarantine (disease control) 2,020,620 Plant Quarantine (physical improvements) 373,050 Forest Service (physical improvements and control of diseases) __- 15. 982, 745 Public-land roads 6,015,000 Weather Bureau 183,840 Biological Survey 976,050 Home Economics « 1, 200 National Arboretum 386,000 Commerce Department Aeronautics __ 2,558,803 Fisheries _ _ 549, 200 Lighthouses 6, 528, 334 Navigation and Steamboat Inspection 33,043 Standards 100, 000 Mines... 272, 800 Interior Department Administration of petroleum Industry 159,000 Alaskan Railroad 210,008 Alacka Road Commission 1,596.000 Columbia Institution for the Deaf 10,000 Freedmen's Hospital 85.000 Geological Survey 4.048.164 Soil Erosion Control 10,000,000 Howard University 2,294,311 Indian Affairs (physical improvements) 7,881,000 Indian reservation roads 4,022,000 Indian reservation (irrigation and drainage) 6,880,550 National Park Service (physical Improvements) 5,066,049 Roads and trails , 24, 680, 650 Repairs to White House 6,000 Boulder Canyon 38,000,000 Owyhee 5, 000, 000 Deer Creek-Utah Lake project 2,700,000 Moon Lake Reservoir 1, 500, 000 Parker-Gila project 100,000 Sanpete project 300,000 All American Canal 6,000,000 Verde River project 4.000,000 Vale 1. 000, 000 Ellenburg 60, 000 Ronald- 400.000 Casper-Alcova 12, 000, 000 Grand Coulee, Columbia Basin 15,000.000 Irrigation (projects bringing no new land tinder cultivation) 18, 140,000 Bureau of Reclamation (physical improvements) 20,000 St. Elizabeths Hospital 930,000 Virgin Islands 302,850 General Land Office 1,000,000 Subsistence homesteads (statutory) 25.000.000 Service Division 2, 176 Special account 18. 500 Department of Justice Prisons . 1, 114, 500 National Training School for Boys 140,012 Department of Labor Immigration 1. 422, 980 Bureau of Labor Statistics. 10,000 United States Reemployment Service 600,000 Office of Secretary, conciliation service 10,000 Post Office Department Departmental (physical improvements) 7,600 State Department International Boundary Commission (United States and Canada) 26,500 International Boundary Commission (United States and Mexico) 4,734,500 Treasury Department Public Health Service 2.167,128 Public Works branch (procurement division), public buildings 63, 987, 653 Coast Guard 24,881,872 War Department Corps of Engineers, flood control, Lower Mississippi — 44, 120, 000 Winooska River Dam 1,555,000 Sacramento River 1,500,000 Rivers and Harbors, general (throughout United States) 81,221,700 Upper Mississippi 33,500.000 Missouri River 17.753.103 Bonneville Dam.. 20.250,000 Port Peck Dam. Mont 25,000,000 Seacoast defenses 7,000,000 Insular Affairs 1,500,000 National Guard 2,238.634 War Deportment — Continued Ordnance - $«. 000, 000 Quartermaster Corps (Army housing and technical oon- structlon) _ CO, 152, 765 Signal Corps 17«. 170 Air Corps, airplanes 7. 600. 000 Motorization 10, 000. 000 National cemeteries 6M. IW Mr. FES8. Mr. President The PRESIDINO OFFICER. Does the SeoAtor from Iowa yield to the Senator from Ohlot Mr. DICKINSON. I yield. Mr. FESS. The Senator has been referrinf to projects begun through the expenditiuv of moneys under the PufoUe Worlcs Administration. Mr. DICKINSON. That is true. Mr. FESS. The President states that the deficit ihis year will be $7,000,000,000, owing largely to emergency expendi- tures. Mr. DICKINSON. That is true. Mr. FESS. Has the Senator any data showing how much money it will take to finish projects which are now being started? If it requires $7,000,000,000 this year, how much will it require next year and the following year and the year after that? Mr. DICKINSON. First, I want the Senator from Ohio to remember that less than approximately $200,000,000 have actually been paid out of the Public Treasury in all the vast program of public works. In other words, most of it has been authorized or allocated but has not been expended. The reason why the huge deficit Is facing us is that funds for all these allocations have got to be provided, although the appropriations were made last spring befoie Congress adjourned. On top of that, new projects are being authorized every day, from the building of sewer systems and the graveling of streets in little villages somewhere up to $50,000,000 projects for some large enterprises or for a housing cor- poration. Mr. FESS. If the Senator will permit me, if by incurring a $7,000,000,000 deficit these projects will be completed — I am not so much concerned, but if the expenditure of $7,000,000,000 will merely start a lot of projects that can- not be completed without further expenditures, I do not see how we are going to determine how much additional is going to be required. Mr. DICKINSON. As I understand the matter, the allo- cations to date have taken up all the $3,000,000,000 which have not heretofore been raised. Mr. FESS. But will the incurring of a $7,000,000,000 deficiency result in completing everything that Is started imder this program? Mr. DICKINSON. I do not thinK it will, for the reason that new projects are being authorized all the time. A list comes into our offices almost every day, showing several million dollars of authorization, and, unless someone puts on the brakes somewhere, I do not know what the limit will be. Mr. FESS. The Senator will recall that In the case of the Muscle Shoals project we were told first that $10,000,000 would be sufficient. Then we voted an initial amount of $20,000,000. Afterward $40,000,000 were added, and subse- quently $60,000,000 more, until the amount finally became $150,000,000; and now we are told $50,000,000 more at least must be provided before we can save what we have already expended. Mr. DICKINSON. That Is right. Mr. FESS. I am wondering whether these projects that are being begim are so indefinite in their calls for expendi- tures for the future that we are going to have the Muscle Shoals experience repeated, so that we will be told. "You must provide this additional amount or lose all you have already expended." Mr. DICKINSON. That has been the experience in the case of practically every public i»t>ject we have ever under- taken. -^ ^^ ^^ A /^/^•kt/-it»t:iocit/-vxt A T t»t7«/^/-\t>t\ O'CXT a rH'C al. director and general counsel, Tennessee Valley Authority. The oOce and principal place of business of said oorporatloE outalde of the State of Delaware shall be at such place In anj of the Teonsssse Valley States as the board of directors shall select and determine, and olBoes may be estabUahed In such placei as said board of directors shall select and determine. The capital stock of said corporation shaU consist of 10.000 •bares of the par value of tlOO each. TlM pmrwaon above named are hereby autbortaed and dltectec to cause said corporation to be formed, with such articles oi certlflcatss of incorporation, and bylaws, as shall be deemec requisite and necessary, and to define the methods by which sale corporattan shall conduct its business. The persons above named are hereby autborlasd and dlrsctec to •ubserlbe for aU of said capital stock for the use and buiefli of the United States. There is hereby set aside for the puxpoM of sabserlblng to the capital stock in said corporation the sun of $1,000,000 out of the appropriation of $3,300,000,000 authorlaec by •set ion 230 of tbe National Industrial Recovery Act and madi by the Fourth Deficiency Act, fiscal year 1833, approved June 16, 1833 (Public. No. 77. 73d Cong.). It is hereby further ordered that any outstanding stock stand- ing In the name of the United States shall be voted by the direc- tors of the Tennessee Valley Authority, jointly, or by such person or persons as the said directors of the Tennessee Valley Authority shall appoint as their Joint agent or agents for that purpose. The board of directors (other than the Initial board ol direc- tors) shall be elected, and any vacancies thereon shall be filled by the Directors of the Tennessee Valley Authority, Jointly, sub- ject to the approval of the President. The board of directors may, without regard to the provisions of the civil service laws or the Classiflcation Act of 1923. as amended, appoint and fix the compensation and prescribe the duties, authorities, responsibilities and tenure of such officers and employees, and make such expenditures (Including expendi- tures for personal services, and rent at the seat of the Govern- ment and elsewhere, for law books and books of reference, and for paper, binding, and printing) as may be necessary to carry Into effect the provisions of this order. The board of directors may also, with the consent of any board, commission, independent establishment, or executive department of the Government, in- cluding any field service thereof, avail itself of the services of the officers, employees, and the facilities thereof and, with the con- sent of the State or municipality concerned, may utilize such State and local officers and employees as it may deem necessary. Franklin D. Rooskvxlt. Thb Whtte House, December 19, 1933. Mr. FESS and Mr. BARKLEY addressed the Chair. The PRESIDING OFFICER. IXjes the Senator from Iowa yield; and if so, to whom? Mr. DICKINSON. I yield first to the Senator from Ohio. Mr. FESS. What is the possible limit of the expenditure of money which may l>e made by the corporation just re- f erred to by the Senator? Mr. DICKINSON. It is my understanding that there has been an allocation of $10,000,000 set aside for that cor- poration, but I do not have the exact figures at the time and am only spealung from memory. Mr. FESS. If that is the amount allocated at the start, what will it be before the undertaking is completed? Mr. DICKINSON. No one knows. Mr. FESS. That is the serious thing in this spree of expenditure in which we are engaged. It is not so much a question with me of the amount being authorized as it is the amount that will be Tequired in order to complete the projects which are started when once they are undertaken in order to avoid losing what has already been put into them. It seems to me there is absolutely no limit to it. Mr. DICKINSON. It seems to me that is a fair inference. Mr. REYNOLDS. Mr. President The PRESIDING OFFICER. Does the Senator from Iowa yield to the Senator from North Carolina? Mr. DICKINSON. I yield. Mr. REYNOLDS. I should like to inquire of the Senator whether or not he has submitted to this body his estimate of the amount of money that will be required to complete every single project that has been inaugurated according to advices from the President of the United States? Mr. DICKINSON. Does the Senator inquire if I have made any such estimate? Mr. REYNOLDS. Yes. Mr. DICKINSON. I will say to the Senator, bless his heart, that I could not get within gunshot of finding out all the projects or where they are or what they propose to do, because they meet themselves coming back nearly every day with some new projects which had not been thought of be- fore. The administration is organizing now corporations which are authori2ed to expend more money for new and particular purposes. I believe that under the authority of one of the laws enacted by Congress, particularly the Na- tional Recovery Act, some of these corporations are legal. On the other hand. I do not know where the movement will lead us, if we keep on. We are going to have a corpora- tion, I understand, to handle foreign imports and exports; we are going to have corporations to provide electrical equip- ment to consumers in the Tennessee Valley. Already a cor- poration has been formed to buy farm surpluses and a cor- poration to buy marginal land. There is a corporation authorized to go into the housing business; there are cor- porations In practically every line of endeavor. I do not believe that one could get information from the various bu- 1934 CONGRESSIONAL RECORD— SENATE 345 reaus of this Government that would enable him to make anjrthing like an intelligent guess as to the amoimt which will be required ultimately to pay the cost. Mr. REYNOLDS. I should like to make inquiry of the Senator as to whether or not it would have been possible for the present administration to have provided for the millions upon millions of distressed human beings in this country had it not been for the measures inaugurated by the administration? Further than that, I have listened with a great deal of interest to the argviment presented by the Senator, and I should like to have him state his specific objection to the various items of which he has made men- tion from time to time. In that connection, at this time, I should like to ask the Senator to state to this body his spe- cific objection to the millions which have been expended by the Government in caring for and providing for 347,000 young men who are today members of the Civilian Conserva- tion Corps in this country. That is merely one of the items. Mr. DICKINSON. I virill express myself on nearly all the items mentioned from time to time. I am going to discuss in a limited way only one of them today. If the Senator will attend here on the floor of the Senate he will hear me, from time to time, and I will be glad to give him my views as to practically every endeavor in which the Govern- ment is now engaged. Mr. REYNOLDS. I have made the suggestion to the Sen- ator, Mr. President, because I know that a great many Mem- bers of this distinguished body are desirous of having the Senator's specific objection to each of these items; and if he will comply with the request I feel confident that we will be in a position to enlighten him as to many of them. Mr. BARKLEY. Mr. President, will the Senator yield? The PRESIDINO OFFICER. Does the Senator from Iowa yield to the Senator from Kentucky? Mr. DICKINSON. I yield. Mr. BARKLEY. Referring to the suggestion just made by the Senator from Iowa, I will say that I expect to be able to attend most of the sessions of the Senate. I should like, however, to inquire of him now in relation to the remark he made a while ago that he had not been able to get within gunshot of any information with reference to any of the items of expenditure. Mr. DICKINSON. I wish to suggest to the Senator from Kentucky that, before the Senate convened, I submitted numerous inquiries thinking that I would obtain a little information that I might present to the Senate. Many of those inquiries have gone unanswered for 2 weeks, 3 weeks, 4 weeks, and longer. It may be that a Republican Senator is not entitled to such information; that is all. Mr. BARKLEY. The Senator no doubt realizes that most of these expenditures made under appropriations for emer- gencies have been made under the jurisdiction of the Admin- istrator of Public Works. We provided that he might make grants and loans and that he might make them separately or that he might combine them. With reference to the loaning provision, does the Senator say that he has made inquiry of the Secretary of the Interior, who happens to be the Administrator of the Public Works Administration, with reference to the amount allocated either for loans or for grants to various communities, cities, counties, and other subdivisions of government with respect to public projects, and has been uhkble to obtain that information? Mr. DICKINSON. I have not made that specific request, but we have a long list of projects here running all the way from a few hundred dollars up to several million dollars, such as the project at Columbus, Ohio, involving $3,400,000 for sewers. I know nothing about that, but I am going to inquire. Mr. BARKLEY. I do not suppose the Senator would ex- pect the Secretary of the Interior to send to him or to us the blueprints, the plans and specifications showing where and how these sewers are to be laid; but does not the Senator know that almost each day we receive a list of new applications from cities and other subdivisions of govern- ment, the purpose for which they are made, the amount of the application, and later that we receive the same sort of inf ormaUon with respect to those that have been approved or which have been acted upon in any way? What other detaUed information does the Senator want, or does he think the Senate ought to have, with respect to each of these projects except that a certain amount has been asked and a certain amount has been allocated, and that the woilt has been done for certain purposes? Mr. DICKINSON. I have not been critidalng the grants to small municipalities, because, as I have said. Ihey repre- sent mere pocket change compared to the amounts expended on the larger projects. It is the larger projects, many of which have been before Congress for years and years and have been rejected, to which I have been directing my attention. Mr. BARKLEY. There may have been projects upon which Congress never acted, but it is not true that all of the projects, or any considerable number of those which have been authorized under the Public Works Administration, are projects which Congress has considered and refused to act upon at all. Many of them have never been passed upon at all. Mr. DICKINSON. Many of them have been here as long as I have l>een here and have never had favorable mention. Mr. BARKLEY. The Senator knows that many worthy projects stand here for years and years and never receive any action. Mr. DICKINSON. If they could not attract the attention of Congress in those times, I am a little doubtful about the poor taxpayer being obligated for the money to build those projects which heretofore have not been able to sell them- selves to Congress on their merits. Mr. SCHALL. Mr. President The PRESIDINO OFFICER. Does the Senator from Iowa yield to the Senator from Minnesota? Mr. DICKINSON. I yield. Mr. SCHALL. I would like to ask the Senator, apropos of " a chicken in every pot ", which costs the taxpayer noth- ing, what it has cost the taxpayer to put a " blue duck " in every window? [Laughter.] Mr. DICKINSON. I do not have the exact amount of that expense, but it is somewhere around $7,000,000,000. as I understand. Mr. BARKLEY. Mr. President, will the Senator from Iowa yield further? The PRESIDING OFFICER. Does the Senator from Iowa yield further to the Senator from Kentucky? Mr. DICKINSON. Certainly. Mr. BARKLEY. Without in any way passing upon the question of whether two cliickens or any chicken at all was put in every pot, we have at least succeeded in putting a " blue duck ", as the Senator from Minnesota terms it, in every window. Mr. DICKINSON. A lot of them have gone into the win- dows and gone out again and are forgotten. As a matter of fact, what happened to many of the " blue ducks " was that they were put in the window, and then the manager of the business never spoke to them after the time he put them in there, but went ahead and ran his business just as he thought he should. Mr. President, there are one or two further i^iases of the matter to which I want to invite attention. No one can In any way imply that in my motives I am not as sympathetic with the man who is himgry as is anyone else. I believe in feeding the man who Is hungry, and there is no reason why he should not be fed; but I want to suggest that in the Clvfl Works Administration many useless projects have been pro- posed and a lot of them have been acted upon. In order that Senators may understand just the motive behind some of them, I want to read a letter which I have here from a man by the name of C. G. KeUey, of Jefferson. Iowa, written to the editor of the Tribune in Des Moines. Iowa. Tlie letter reads: To the Eorroa or thb TuBtjm: I notice some company at Ames bas 436 men engigad m tarn nrecarlous work of killing nuaqoltoes. and they are going to put on aoo more, making 830 men. Z said killing nKMquitoes. BeaUy. I fueaa. it la moaquito oomtral. 346 CONGRESSIONAlJ RECORD— SENATE \ 1 am out at • Job. and I am wondering 11 you could help di« get started with those people. Ab you know, a person can buy common lath at about 1 cent each. I could cut a lath in four pieces and make a kind )f paddle. They could catch the moequltoes and hit them with oi le of these paddles, and if they were not too ferocious It would fcll them. I would be willing to furnish these to the Qovemment for, sa y. •5 each, if they would need 826 of them. I would furnish them for an even $3,000. and you see thit would save the Government $130. Now, the men that operate these paddles should not be requir >d to work loiter than 1 hour in the forenoon and 1 hotir In tl ve afternoon, as it might cause callous of the hands. Really I don't think It is very good sportsmanship to go o'lt after those animals when it Is 16 below and have the water ill frozen up so they cannot dive out of the way when they see t: »e soldiers coming. We would not shoot a duck sltUng on the water or a pheasait standing eating com off a stalk. I think we had better get this deal through pretty soon, as I a m afraid that at the present rate of extravagance there will not >e any money left to pay for the paddles. C. O. KxLvrr, Jeffer$on, Iowa. I also read in the newspapers that they are going to btiy a famous duck preserve somewhere. The Qovemment is going to be authorized to charge the taxpayers and ma :e them pay interest in the next 2 years in order to buy duck preserves that will cost stxne two or three million dollais. They are also going to have real-estate men and architec ts make a survey of housing conditions in the country to dete r- mine whether or not we shall build more or build less. Th ;y are even going to paint pictures in some of the cotirthouses that have been getting along without pictures for a greit many years, and yet that is a part of the Civil Works A i- mlnlstration program. They are going even further than that. According to t le Evening Star, in Owls Head. N.Y., on December 30. th;y were very much afraid that the wolves were going to ma :e an invasion of that locality and therefore they are goLig to have the Civil Works Administration mtUce an allocation of many thousands of dollars to kill the wolves in thit region. I do not refer to these things simply to criticize the whc le program, but I do say that they are merely indicative of the fact that if we permit these various fimctions to pr3- ceed, we are goinrr to charge numerous useless expenses against the Government which the taxpayers of the United States are going to have to pay. and that is one reason wny I believe we should have some check on the expendituri ^s. In my resolution I have asked that copies of the variois reports coming to the Director of the Budget shall be filled with the Secretary of the Senate. If they are not of li- terest to anybody else they are going to be of interest to me. because I am going to borrow them and take them hoi le and read them one at a time to see whether or not there is some way by which some curtailment of expenditures c m be made, not those that are needed, not those that are ua e- ful. but those that are useless and worthless and will not. tf you ideaae. do the things that were proposed to be dope under the legislation which was enacted. Kxxcirrxw mxs&acks Mxrm.ro As in executive session, the Presiding Officer (Mr. BARsobt in the chair) laid before the Senate messages in writiig from the President of the United States submitting simdry nominations, which were referred to the appropriate coia mlttees. (Por nominations this day received see the end of 8en4te proceedings.) CUtCUTlVK UPOSTS OP COKiaTTXKS As In executive session. Mr. CLARK, from the Committee on Finance, reported Ija voraUy the nomination of Thomas J. Sheehan, of St. Lov is, Mc to be collector of internal revenue for the first district of Mtssoori in place of Louis J. Becker, resigned. Mr. C08TI0AN. from the Committee on Finance, report^ favorably the following nominations: Raymond Miller, of Colorado, to be collector of custoiis for cust<»ns collection district no. 47. with headquarters Ut Denver. Colo., in place of Thomas T. Wilson; January 10 1934 CONGRESSIONAL RECORD— HOUSE 347 Mark A. Skinner, of Denver, Colo., to be superintendent of the mint of the United States at Denver, Colo., In place of Frank E. Shepard; and Bruce B. La Pollette, of Oilman, Colo., to be assayer in the mint of the United States at Denver, Colo., in place of Clarence C. Malmstrom. Mr. McKELLAR. from the Committee on Post Offices and Post Roads, reported favorably the following nominations: William W. Howes, of South Dakota, to be First Assistant Postmaster General, Post Office Department, vice Joseph C. O'Mahoney; and Harllee Branch, of Georgia, to be Second Assistant Post- master General, Post Office Department, vice William W. Howes. Mr. FLETCHER, from the Committee on Banking and Currency, reported favorably the following nominations: Walter J. Cummings. of Illinois, to be a member of the board of directors of the Federal Deposit Insurance Corpo- ration for term of 6 years, to which office he was appointed during the last recess of the Senate; Elbert G. Bennett, of Utah, to be a member of the board of directors of the Federal Deposit Insurance Corporation for term of 6 years, to which office he was appointed during the last recess of the Senate; Albert Simon Goss, of Washington, to be Land Bank Com- missioner in the Farm Credit Administration; and Francis Winfred Peck, of Minnesota, to be Cooperative Bank Commissioner in the Farm Credit Administration. Mr. WAGNER, from the Committee on Public Lands and Surveys, reported favorably the nomination of Mrs. Jessie M. Gardner, of Colorado, to be register of the land office at Denver, Colo., vice Walter Spencer, whose term has expired. Mr. PITTMAN, from the Committee on Foreign Relations, reported favorably the nomination of R. Walton Moore, of Virginia, to be Assistant Secretary of State, to which office he was appointed during the last recess of the Senate; the nomination of Francis Bowes S&yre, of Massachusetts, to be Assistant Secretary of State, to which office he was ap- pointed during the last recess of the Senate; the nomination of Sumner Welles, of Maryland, to be Assistant Secretary of State, to which office he was appointed during the last recess of the Senate; the nomination of Hal H. Sevier, of Texas, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to Chile; the nomination of William Christian Bullitt, of Pennsylvania, to be Ambassador Extraordinary and Plenipotentiary of the United States of America to the Union of Soviet Socialist Republics; and also the nominations of sundry other officers in the Diplomatic and Foreign Service. Mr. DILL from the Committee on Interstate Commerce, reported favorably the nomination of James M. Landis, of Massachusetts, to be Federal Trade Commissioner for the term expiring September 25, 1940. The PRESIDING OFFICER. The report* will be placed on the Executive Calendar. ADJOtTRNMCNT Mr. ROBINSON of Arkansas. I move that the Senate adjourn until 12 o'clock noon tomorrow. The motion was agreed to; and (at 4 o'clock and 20 min- utes pjn.) the Senate adjourned until tomorrow, Thursday, January 11. 1934, at 12 o'clock meridian. NOMINATIONS Executive nominations received by the Senute Wednesday, January 10, 1934 Assistant Secretary or Commerce Ewing y. Mitchell, of Missouri, now holding recess appoint- ment, to the position of Assistant Secretary of Commerce. First Assistant Commissioner or Patents Richard Spencer, of Illinois, now holding recess appoint- ment, to the position of First Assistant Commissioner of Patents. Director Bureau or Foreign and Domestic Commerce Willard L. Thorp, of Massachusetts, now holding recess appointment, to the position of Director, Bureau of Foreign and Domestic Commerce. Assistant Directors. Bureau or Foreign and Domestic Commerce Henry Russell AmoiT. of California, now holding recess appointment, to the position of Assistant Director, Bureau of Foreign and Domestic Commerce. Nathanael H. Engle, of Washington, now holding recess appointment, to the position of Assistant Director, Bureau of Foreign and Domestic Commerce. HOUSE OF REPRESENTATIVES Wednesday, January 10, 1934 The House met at 12 o'clock noon. The Chaplain, Rev. James Shera Montgomery, DX)., offered the following prayer: O Thou who art the " I am that I am " and our Heavenly Father, too. who forgives, who redeems, and who satisfies, waken in our souls an unutterable silence and grandly vital- ize our way. Inspire us to adorn our station with sincere devotion and un3rielding fidelity. Guard our speech, quicken our steps on errands of mercy, and make our hearts to rejoice in the doing of the fine and lovely things of life. As we walk amid the sunlight and the shade in life's garden we pray that our example may refresh and not oppress, may liven and not deaden while heaven's light burns clean and deep in cur breasts. Blessed Lord. God of love, give Thy blessing of encouragement, comfort, and rest to the down-hearted, the oppressed, and the homeless, and may we use the might of our mission to bring them relief ; so direct us, our Heavenly Father. In the name of our Savior we pray. Amen. Tlje Journal of the proceedings of yesterday was read and approved. messages from the president Sundry messages in writing from the President of the United States were communicated to the House by Mr. Latta, one of his secretaries. the influence of the ideas of dr. schurman on the char- acter AND tendencies OF THE AMERICAN REGIME IN THE PHILIPPINES Mr. OSIAS. I ask unanimous consent to extend my re- marks in the Record by inserting a speech on Dr. Jacob Gould Schurman, the president of the First Philippine Com- mission, by the Filipino leader and statesman, Senator Sergio Osimefia. The SPEAKER. Is there objection? There was no objection. Mr. OSIAS. Mr. Speaker, under leave to extend my re- marks. I give hcreimdcr a speech by the Filipino leader and statesman. Senator Sergio Osmefia, at the Columbian In- stitute. November 27, 1933, deaUng with the ideas and ideals of Dr. Jacob Gould Schurman, the great American who was chosen by President McKinley to be president of the first American Philippine Commission sent to the islands: Mr. President, ladle*, and gentlemen, profoundly grateful for the honor of being your guest today, permit me to make a few remarlta on the Influence of the Ideas of Dr. Schurman on the Character and Tendencies of the American Regime In the PhU- Ipplnes. Dr. Schurman has Just visited us for the third time. As It was to be expected, he was enthusiastically welcomed not only by the different elements of our people but also by the Americans and foreigners who live with us. This recent visit of Dr. Schur- man and the speeches which he had delivered during his stay here render timely the consideration of the subject which I have chosen and which I would have liked to discuss more extensively and in detail If I had the necessary time. When, alter the victory of the American forces, Spain was pre- paring to transfer to the United States the sovereignty over these Islands, the American Government became confronted with a great problem In defining the political relations that It was to have with the Philippines; whereupon President McKinley called Dr. Schiu-man, who was then president of the University of Ckjr- nell. and made him chairman of the first PhUlpplne Commission, whose prime duty was to study the conditions In the PhUlpplnes and recommend to the United States the policy to be followed with regard to Uie same. The Schurman Oommiaalon urrtved In ManUa on March 4. 1899. and aUyed here for about 7 montha. The task that was entrusted by President McKinley to Dr, Schurman and his associates was of an extremely delicate natur«. The Commission made as thorough an investigation aa It was pos- sible to make considering the status of war that It found In the Philippines, with the American and PlUplno forces in open hos- tilities. An extensive study was made of all the phases of our political and social problems. Including the qxiestlon* of popxila- tlon. education, legislation, public lands, public Institutions, agri- culture, forestry, meteorology, mines, railroad, and eommeroe. Special attention was given to the government which had been Implanted by the Spaniards and the reforms which from time to time have been demanded by the Filipinos. The study that had been made by the Schurman Commission Is of Indisputable value; Indeed, I consider it the most Important of all that had been made during the whole period of American occupation. The result of the Investigation has been published in a report of four voliunes. replete with most Interesting data regarding the political, economic, and social conditions then prevailing. Whatever may be the real value of the Investigation, and what- ever few mistakes may have been made In the appreciation of existing conditions — errors which are natural and Inevitable in a work of this nature, undertaken In a foreign land, and In the midst of abnormal conditions — the portion of the report which Is of greatest Interest to us is that which refers to the formulation of the policy which should be followed by the United SUtes In the Philippines. The Commission recommended a form of gov- ernment giving immediately to the Filipinos a participation which shall gradually be Increased until the people shall be In a con- dition to completely assume the responsibility Imposed upon the United States by the Treaty of Paris. The Philippines was not to be an American state or an American colony. Neither was it to be Independent under the protectorate of the United States. The political relations were to be of a temporary rather than permanent character. In the last analysis, the plan of Dr. Schurman was one of gradual preparation for independence. Let me mention two outstanding features of the plan of govern- ment submitted by the Commission: The first salient feature waa autonomy for the provinces and municipalities. Dr. Schurman was highly shocked with the so-called " Intervention " of the central government which appeared In the plans of government which had been submitted to him by some Filipinos. The sec- ond outstanding featxire of the recommendation was the grant of pwpular participation In the national legislature through an elec- tive assembly, coupled with the FUlplnlzatlon of admlnlstraUve positions. Insofar as possible; the adoption of an efficient civU- service system; an Independent Judiciary; and free elementary In- struction, and the giving of a representation to the FUiplnos in the United States. The Philippine Government was to be self-supporting and the government was to be r\m for the Interest of the Filipinos. The exploitation of the Islands as a colony was not to be allowed. The United States was not to vote any funds for the expenses of the Philippine Government but neither was the income of the Philippines to be employed for the benefit of the Government of the United States. The motto of the Government was to be the "Philippines for the Filipinos." This was the same slogan which gave fame to Governor Taft when he came to the Philippines af the President of the second commission and later became governor under the civil government. The clrcimistances under which Dr. Schurman announced for the first time in 1902. the motto of the " Philippines for the Filipinos ", reveal his real objective. The Taft Commission, which was then exercising goverrunent functions In the PhiUplnes, asked that it be given legislative power to authorize the Issuance of bonds: to grant municipal franchise: to dispose of the public lands, mines, and forces; to regiUate corporations and grant raU- road franchises. Dr. Schurman, who had gone back to Cornell after the commission over which he had presided bad completed Is tasks, was following the progress of the work in the PhUlpplnee. Gen- erally, he gave his cordial support to the administration of th« Taft Commission; but when the latter asked for the legislative prerogatives above mentioned. Dr. Schurman favorably Indorsed the petition on one condition— that the Philippine Assembly, whose creation had been recommended, be ImmedUtely esUblisbed so that in dealing with the ImporUnt problems for th* solution at which the legislative authority was asked, the Filipino people ajuM Intervene, To epltomlae hU views be said that the PhlUppUiee should be for the FlUplnos." The recommendations of the Schurman Commission were flm submitted to President McKinley. and later In FebruMy IWO, to Congress. The goverrunent that was Implanted by the Amertcane In the Philippines, from the inaugviratlon of the dvU gortmmtat In July 1900, and especially after the approval by Congress of the Cooper Act of July 1. 1902. was substantially the government recommended by the Schurman Commission. The substantial closeness between the recommendations of the Schurman Commission and the plans of the Taft Commission has been reflected In the similarity of the views which have been expressed by Dr. Schvirman and Mr. Taft In relation to certain Important questions. ^^^ As I have stated. Dr. Schurman had expressed himself in 1908. In favor of the policy that the Philippines should be for the Filipinos. In his memorable speech delivered on December 17, 1903 Mr Taft stated that the honor of the Amertcan people was pledged to the policy of "the Phlllppmes for the FUlpUios." Both Dr. Schtirman and Mr. Taft spumed the sxiggestion of the exploitation of the Philippines for the benefit ot the United 348 CONGRESSIONAL RECORI>— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 349 4 SUtes. Both sUted poslUvely that Ameiic* was In the PhllU>- plnaa to promote the well-being of the Pillpinoa. Dr. Schtirman and Mr. Taft also coincided In their views ie- gardlng the capacity for »elf -government which we should reveal during the constitutional process required by the United Statss. Let me quote their w«)rds on this subject : " Capjw.lty for Independent self-government ", Dr. Schumu n said, "does not necessarUy mean capacity like ours to administer a Commonwealth Ui.e ours, but merely capacity of some sort to maintain peace and order, to uphold law. and to fulfill Intern i- tlonal obligations." And Mr. Taft used the following language: " The standard set, of course, is not that of perfection or sucta a government capacity as that of an Anglo-Saxon people, but It cer- tainly ought to be one of such popular political capacity, that coia- plete independence in its exercise will recult In progress ratler than retrogression to chaos or tyranny." That the plan (rf giving the Filipinos a gradually greater par- ticipation Ln the government recommended by Dr. Bchurman at a basic policy, and put into practice by Mr. Taft. should inevltally lead to the Independence of th« PhUlpplnea. was a fact admitted by both Dr. Schurman and Mr. Taft. In his speech In Manila in ONctober 10. 1007, on the occasion of the Inauguration of the Ph 1- ipplne Assembly. Mr. Taft said as an envoy of President Rooseve t: ** The svoiwed pcdlcy of the national administration under th< se two Prcsldenta (McKlnley and Roosevelt) has been and Is to govern the flanrts. having regard to the interest and welfare of the PUIplno people, and by the spread of general piiznary aid Industrial education and by practice In partial ptolltlcal control to fit the people themselves to maintain a stable and well-ordeied government, affording equality of right and opportunity to ill eltlxena. The policy looks to the Improvement of the people, bo fch Industrially and in self -governing caftaclty. As this policy of ex- tending control contlnuee. It must logically reduce and finally eid the sovereignty of the United States In the islands unless it shdl ■eem wise to the American and the Filipino peoples, on account of mutually beneficial trade relations and possible advantage to the islands In their foreign relatlona. that the bond shall not tie completely severed." Dr. Schtirman was no less explicit and positive in his utteranc m. Considering the fact, which to him was fundamental, that t le political emancipation of the Filipinos was the paramount obJ4 ct which had moved President McKlnley to demand the cessioD, of the Philippines and that, according to President RooaeveU, Amen ca hoped to do for the Philippines what has never been done for a ly people of the tropics — to make them fit for self-government afi er the fashion of the really free nations. Dr. Schurman said: ** I say you will never consent to make the Philippine Islands i in Integral and organic part of the United States of America. • • * Very well: what then? A colony, a dependency? For a time tl is status may suffice: as a permanent arrangement it is impoaslb e. For you propose to dower the Filipinos with an ever-lncreasl: tg measure of liberty; but Uberty grows by what It feeds on. and moves rapidly to Its goal, which is Independence. Then, too. t le Filipinos have condensed the experience of centurlee Into th< m last half doeen years. They have dreamed of liberty: they hare fought for liberty: they have seen In the east the star of Inde- pendence. These are facts as potent as any other — and deeper than most — in the life of nations. • • • prom the American point of view, then, ever-increasing liberty and self-government is to be our policy toward the Filipinos; and it Is the nature of surh continuously expanding liberty to issue In Independence. This, then, is our program for the future, both near and remote." And discarding the poasibllity of annexation, cither forcible or voluntary, he concluded: "The watchword of progress, the key to the future of tie political development of the SKrhlpelago, Is neither colonialism n or federalism, but nationalism. The destiny of the Philippine Islan Is ts not to be a State or Territory in the United States of Amerl:» but a daughter republic of ours — a new birth of liberty on tie other side of the Pacific . which shall animate and energize the se lovely idands of the tropical seas. and. rearing its head alo t, stand as a monument of progress and a beacon of hope to all t le oppressed and benighted millions of the Asiatic Continent." But great as was the service rendered by Dr. Schurman to Ms country and to the Phillpplne.r it interesting and instructive and. above all. humane. Dr. Schurman has never deviated from this basic prlnc^lc >f his Philippine policy — our ultimate Independence. Not only n the >pe aches which he had recently made in the PhUlpplnea. b it In all the addrcans which he had made In the United State* du :- ing all these years, especially his speeches during the considera- tion by Congress of the Hare bill and the Hawcs-Cuttlng bill, he had emphatically reiterated that the aspiration of the Filipinos and the duty of America in the PhUIppines perfectly coincide — the recognition of our independence. In urging Congress to approve either of the two bills as a Just and proper solution of the Philippine problem. Dr. Schurman expressed himself in clear and unequivocal language, thus: " Our mission in the Philippine Islands is finished. The rest the Filipinos must do for themselves. It is for us to give them the opportunity by granting them complete independence. " The hour for action has arrived. I ask In the language of the act of Congress. Are the American people now ready ' to withdraw their sovereignty over the Philippine Islands and to recognize their lndei)endence? ' I repeat the inquiry in the words of Presi- dent Wilson, Are we now prepared ' to keep our promise to the people of these Islands by granting them the independence which they so honorably covet? ' Remember. It was the humanitarian object of liberating the Filipinos from Spanish tyranny and be- stowing upon them the boon of freedom that decided President McKlnley and the people of the United States to compel Spain to cede to us her sovereignty over the Philippine Islands. " Fortunate, indeed, that no lower motive prevailed. Any other object than the humanitarian one of canylng the gift of freedom to the Filipinos would have ended In vast and bitter disappoint- ment or, perhaps, even Ir poignant remorse. Did we need the Philippines to make our power felt in Asia? No; for we can exert I the most potent national Influence in all quxurters of the world { without owning adjacent territory. And had we gone to the Philippines for commercial gain, when, think you, would our traders' profits have amounted to the hundred of millions of dollars which the archipelago has already cost us? And what shall I say of the thousands of brave young Americans who have lost their lives In the Philippines? No prospect of pront. how- ever assured, no wealth or advantage, however colossal, could ever atone for the precious American llfeblood swallowed up by the hungry soil of Luzon and the Vlsayas. For such a sacrifice there is only one Justification. It Is the discharge of duty, service in a righteous cause. If our presence in the Philippines be not Justi- fied in its purpose and Intent, then our soldiers' blood is on our hands; aye, and all the blood. In that case innocent, of the Fili- pinos we have fought, the misery we have caused their families. and the devastation we have wrought in their homes. " This awful responsibility we cannot escape, either before our own consciences or at the bar of history, unless we have done what we have done In the Philippines for the sake of redeeming the Filipinos from foreign oppression, saving them from domestic anarchy, and leading them into the ways of self-governrrtent and Independence. That is a blessing at once unmeasured and im- measurable. That blessing, and that blessing alone. Justitles our Philippine enterprise." " Yesterday the Philippines were a dependency of America. Tomorrow they will be a sister republic. May the two nations and peoples be united eternally In the bonds of a close and Inti- mate friendship." The permanent place of Dr. Schurman In the political history of our country is assured. His ideals and his principles are firmly and definitely Imbedded in our fundamental iiiaiitutlons. His name shall figure in the roll of honor of the champions of human liberty. w PURSTirr OP America's pxtrpose Mr. GUEVARA. Mr. Speaker. I ask unanimous consent to Insert in the Record the speech of the Honorable Eipidio Quirino. majority floor leader of the Philippine Senate, de- hvered on December 20. 1933, before the Foreign Policy Asso- ciation at Chicago, informing the Government and peo- ple of the United States of th« views of those who opposed the acceptance of Act No. 311, commonly known as the " Hare-Hawes-Cutting law ", enacted by Congress on Janu- ary 17. 1933. The SPEAKER. Is there objection to the request of the Commissioner from the Philippine Islands? There was no objection, Mr. GUEVARA. Mr. Speaker, under the leave to extend my remarks in the Record, I include the following speech of the Honorable Eipidio Quirino, majority floor leader of the Philippine Senate, delivered on December 20. 1933, before the Foreign Policy Association at Chicago, informing the Gov- ernment and people of the United States of the views of those who opposed the acceptance of Act No. 311, commonly known as the " Hare-Hawes-Cutting law " enacted by Con- gress on January 17, 1933: I wish to express my deep appreciation for the opportunity ex- tended to me to bring to your attention the present status of the Filipino strtiggle for liberty. As you are all aware, a law was enacted in the last session of the Seventy -second Congress pur- porting to grant Philippine Independence after 10 years of transi- tion from the establishment of a Philippine Commonwe?lth gov- ernment provided thereunder. Before this law was to be operative the Philippine Legislature or a national convention called for the purpose should accept it. The Philippine Legislature, however, declined to accept the law. and Instead created a new Independence Delegation to proceed to the United States to restate the Philip- pine case to the Government and people of this country. For the last 35 years the Filipino people have been unequivocally expressing their desire to be free and independent from the United States. After wresting the Philippines from Spanish power and establishing a republic at Malolos, the Filipino army, mistaking right for might, resisted American occupation and received a stag- gering blow. Henceforth America remained in possession of the Philippines and established therein a government which, In the words of United States Presidents, both Democratic and Repub- lican, was merely preparatory to Filipino self-government and Independence. In 1916, as you will remember. Congress made patent this pur- pose by enacting the Jones law, which promised to grant com- plete Philippine independence as soon as a stable government has been established in the Islands. In 1920 President Wilson certified to Congress that this condition was fulfilled and that It was the duty of the United States to grant the coveted Filipino freedom. But the Congress failed to act upon this recommendation of President Wilson. We have employed all means of appeal, from memorials and petitions to national prayer. Missions after missions have been sent to the United States since 1919. At last, on January 17, 1933. the Hare-Ha wee-Cutting Act was passed, making a proffer of indejjendence. The natural and logical question that may be asked now Is, Why did the Philippine Legislature decline to accept this law? To th03e who have not closely followed the trend of events which l»d to the nonacceptance of this law, or who have not care- fully analyzed its probable ill effects upon the economic ar.d politi- cal future of the Philippines, it may seem strange that the Philip- pine Legislature should decline to accept said law when its avowed puj-pose was to grant the Islands independence. In order that you may the better understand the position of the Filipino people In this regard and in order also that the real purpose of the new Philippine Independence Delegation now present In the United States may be made clearer. I beg leave to seek your Indulgence so that I can present the informational background of the negative action of the Philippine Legislature. I shall not tire you with the full details. I shall only point out two or three, or perhaps four, of the most ImporUnt reasons upon which the Insular legislature based its action. The first is the provision of the law which gives the United States, at the discretion of the President, the right to have and hold forever military and naval reservations in the Philippine Islands after Independence shall have been granted. At present there are about 250.000 hecUres of land in the Philippine Islands reserved by the United States as military and naval outposts Some of them are located in very strategic places from the stand- point of commerce and national defense. These military and naval reservations include the Corregidor Island, the Cavlte Navy Yard, and the Marlveles Naval Station, all of which are found in the entrance of the Manila Bay and constitute the key to the national defense of the capital of the Philippine Islands, which is at the same time the center of commerce of the archi]>elago. In the very city of Manila, dotted near each other, and In the midst of the most thickly inhabited districts of the city, there are at least five military reservations, while in the immediate vicinity af Manila along the Paslg River there Is the Fort McKlnley. of several square miles. A few miles north from the city of Manila there ts the Camp Stotsenburg, the largest of them all. and almost imme- diately west of this reservation there Is the Masinloc Naval Reser- vation. Scattered throughout the northern part of the Island of Luzon there are other military and naval reservations — in Baguio, Mountain Province: Burgos, Ilocos Norte; Cauayan, Isabela Prov- ince; and other places. In the southern part of Luzon and throughout the Vlsayan Islands there ate also military and naval reservations, most im- portant of which are those In Los Banos, Laguna; Sorsogon, Samar, Leyte, Palawan, Romblon, and Ilollo. WhUe In the Island of Mlndano and In the Sulu group, and scattered throughout the coasts and occupying the best strategic points for defense and commercial ports there are also military and naval reservations m Overton and Camp Keithly, both in the Province of Lanao; three military reservations In Zamboanga, the most Important and beautiful port of Mindanao; the military reservation in Jolo, and other places in the southernmost point of the archipelago. In all, there are about 62 United States military and other reservations in the Philippine Islands. Under the provisions of the Hare-Hawes-Cutting Act any or all of these military and other reservations can be retained as the property and for the permanent use of the United States by presi- dential redeslgnation within 2 years after the declaration of Philippine independence. Let us not be misunderstood in our objection to this power and discretion given to the President of the United States under the law. It is not that we are absolutely unwilling to grant or cede to the United States Government some naval or coaling stations that the Federal Government may need for its own purposes, but we certainly cannot conceive how the Philippines could be really and truly Independent if the United States is to retain and main- tain indefinitely military and naval reservations scattered throughout the archipelago and In the most Important strategic and commercial places Another objection to this military and naval provision Is based upon the fact that it would seem likely to defeat the desired neutralization of the Philippine Zalanda. The Bare-Hawee-CutUnf Law authorizes the President of the United SUtes to negotute with foreign powers treaties that would guarantee the neutrality of the Philippines. It is at least doubtftU whether naUons hav> Ing interests in the Pacific would care to guarantee the neutrality of a country in which one of the great powers haa so many mili- tary and naval reservations. We, of ootirse. know that there ax9 many people who have lost faith In treaties and who give very little or no Importance to the neutralisation of the PhlUppinee a* a means of Insuring the pefu;e and territorial integrity and inde- pendence of that little country. But as we know of do other way whereby small nations could be protected from foreign aggres- sion, and as. in any event, this is the courae which the United States Congress has adopted, we are perfectly satisfied with it and therefore wish that every possible objection to the accompllah- ment of this purpose be eliminated. The next main reason of the negative action of the Philippine Legislature on the Hare-Hawes-Cutting Act is based tipon the trade relations between the United SUtes and the Philippine Islands during the lO-jrear period previous to the granting of Independence. Under the provisions of this much-discussed law, Philippine products exported to the United States during theee 10 years will be limited in volume, and the excess export shall pay the full rate of tariff that is Iniposed upon foreign goodi entering the United States. But even the Philippine products that would come into the United States within the specified limits, as well as all other Philippine goods entering duty-free without being Included in the free list, shall have to pay an export tax beginning from the sixth year of this transition period. This export tax would increase annually by 5 percent until it becomes 2f percent of the full rate on the tenth year. At the end of the tenth year, the full rate of the American tariff shall be Imposed upon all Philippine goods entering the United States. By the way. export tax. as you know, is prohibited by the Constitution. An analysis of the probable effects of thU tax upon the major Philippine industries shows that, before the end of the 10-year transition period, the Philippine sugar industry, coconut in- dustry, and cordage Industry, as well ■• other important indus- tries like the tobacco, embroidery, and button Industries, shall have been ruined. This, of ootirse, will affect, adversely, the revenues of the Philippine Government and impoverish the country. On the other hand, American products would enter the Philippine markets free of duty and without any limitation. The present free-trade lelatlons between the United States and the Philippines were established In 1009 against the objec- tions of the Filipino representatives both at home and In Congress. Because of this trade arrangement, the volume of trade between the United States and the Philippines has tremendously In- creased—from r42,343,888 In 1909 to ,W«7 391582 in 1982— repre- senting an increase In the share of the United States in the total trade of the Islands from 82.07 percent in 1909 to 77 percent in 1932. This trade also represents an increase in the total Imports of the islands from the United States, from 20.73 percent In 1900 to 65 percent In 1932 of the total Import trade of the Islands, while It represents an increase in Philippine exports to the United States from 42.17 percent In 1909 to 87 percent in 1982 of the total export trade of the Philippines. Although there has been a mutual Increase in the volume of trade between the two countries, official statistics Show that the proportion of Increase has been greatly In favor of the United States. To illustrate, the average yearly exports of the Philip- pines to the United Stetes for the lO-year period immediately preceding the establishment of free trade (1899-1908) was 1*19.- 026,916, while the average yearly exports for a similar period of 10 years thereafter (1921-30) was fl98,461347. ThU shows an in- crease of 391.2 percent for the Philippine Islands. On the other hand, the exports of the United States to the Philippine Islands for the lO-year period, from 1899 to 1908, show a yearly average of W,073,367, as compared with the average yearly exports to the Islands for the 10-year period from 1921 to 1930, amounting to 1*139,921,006, representing an Increase of 1,633.1 percent. Thus. while Philippine exports to the United SUtes have increased only 391 percent. United States exporU to the Philippines have creased 1.633 percent. Official statistics show also that as a whole, from 1909 to 1930. Philippine exports to the United SUtes have Increased by 615 percent as compared with 1.113 percent Increase In the exports of the United States to the Philippines during the same period. But, besides the fact that the United States has derived more advantage from the present free- trade relations between the two countries, the Philippine Islands, which takes from the United States 65 percent of the total Import trade of the islands, and exporU to this country 87 percent of the total Philippine export trade has become completely dependent upon and Is now eco- nomically at the mercy of the United SUtes because of these free-trade relations. ^ ^ -.,^. .... It is not. therefore, the desire of the Filipino people to con- tinue Indefinitely with this arrangement specially if It is not the wish of the American people. But it is evident that the Filipino people should be given reasonable time, and under favorable con- ditions to set up their own economic structure Independent of the United States. It may be argued that such is precisely the reason why there Is provided under the Hare-Hawes-Cutting law a period of 10 years during which the Philippines Is expected to make lU economic readjtistment. Tea. 10 years are sufHcient for this pur- pose and if the IlmlUtions imposed upon the free entrance of our moducto into the United SUtes were based upon the sutus que. that is to say, upon our present exports, and the export tax were TI/^TTC1I7« CONGRESSIONAL RECORD— HOUSE I II 350 •ltmln«tod. the prorrlalonj of the Uw m •mtnOmA tn thJa nutm ter i w«3Uld meet the economic situation. It should be emphasized, however, that our desire to tafegxurd the economic and financial position of the Philippine* is not prtill- cated upon any Intention on our part to give undue importance to the material things of life aa compared with qjlrltual and mo-al vaiuea. To qb. freedom Is everything. But In these times In which we live no country can be truly independent unless It can support lt«etf. And It is precisely because'^ we want to insure iiot only the grantli^ but the maintaining of our independence as well that we feel in duty bound to call the attention of the American Oovemment and people to the flnanfT.ial and eoonoxilc difficulties whk:h wouUl confront our country tmder the tnde provisions of the Hare-Hawea-CutUng law. I repeat, the tnde relations between your country and ours have been forced upon us by Congress. In the course of yeirs such trade relattons. artificially fostered by the American tailfl. have aoade the Islands dapendent upon the American market. A sudden, closing of this market or an undue curtailment of ( ur exports into the United States before we have time to prepare ourselves for world competition would be disastrous. And if t ils were to happen there will be numy people who. uninformed of < he causes thereof, would attribute it to the incapacity or Inability cC the PUlpino people to establish and maintain their own g tv- emment. The rssction in this country to such a sttitatlon in i he Philippines wUl likely be that the promised Independence should not be grantsd at the end of the 10-year traasltlon period. ReaunUng. therefore, the Hare-Hawes-Cutting law is self-defe it- tng In that with the provisions regarding United States mllltkry and naval reservations complete Philippine Independence Is Inco m- patible. and with the trade relations thereunder our country ^rlll be ruined. One sentimental but not secondary objection to the law consi sta In the fact that under It Pliiplno immigrants to the United Sta tes would be treated as bona ftde foreigners under the quota basis d ir- Ing the transition period, and thereafter as undesirable foreign ( le- ments to be absolutely excluded from the mainland. On he other hand, for the ben^t of the sugar planters in Hawaii, these Immigrants may go Into that Territory of the United States in my number, depending upon the needs of the plantations and subj set to the approval of the Federal Secretary of the Interior. If it were not for the fact that under the commonwealth oonstitut on the Filipino people are compelled to acknowledge, re^wct. ind safeguard the existing rtghu of American citizens and corporations In the Philippine Islands to the same extent as if they were of Filipino cltlaens mwi corporations, aid that during all the per od of traasltlon Amerli^an citizens In tLe islands would enjoy pra4 tl- cally the same rights and privileges as PiUplnos thenuelvee en oy In their own countxy, the discriminatory provisions of the tw against FUlplno immigrants Into the United States would not h kve the importance that the Filipino peopi/> have attached to It (lut of racial dignity and pride. Certainly, we cannot conscientiov sly understand why we should be considered as undesirable fCH-elgaers In one case and as subjects or mere commodity in another. ( le- pendlng upon wheiJier or not the Filipino immigrants could be utilised by the AmU at the optit rise to speak on the silver question. I rose pi i- marily because the committee in charge wanted to drsft aomeone to speak. But I welcome this opportunity to sjiy a few words. Ever since the Congress met. some of my Democratic friends have been coming to me and saying, ** We want a wholesome opposition, we want an active mi- nority and an aggressive militant opposition party." There never was a time in our history when It was more necessary to fight for the preservation of American ideals and institu- tions from the encroachments of socialistic tendencies and actual State socialism than today. It is the duty of the Republican Party now in opposition to oppose the undermining of our institutions by further socialistic experiments. There are plenty of Democratic Members of Congress still taking orders who quietly admit that there are many things going on, many of the methods and policies of their party, that they do not agree with, but cannot oppose, naturally, because of p>arty loyalty— loyalty to the Democratic House (Hvanizatlon — and. of course, to say nothing of the plums and patronage which high-minded Members on both sides of the aisle never must take Into consideration. I think that attitude represents the viewpoint of a great many Democrats. They want the opposition to take up and discuss and flght those measures they do not believe in, even in the midst of this emergency, and not merely take a complacent and " me, too ", attitude. Mr. Chairman, no one can accuse the Republican Party of trying to block or hinder emergency legislation. It has been the policy of our party since Its foundation, in time of war or in time of a Ucans have gotten into the Democratic overcoat? Mr. FISH. It seems to me now that we more nearly rep- resent the principles of Thomas Jefferson, and I, for one. as a Republican, am proud to do so. [Applause.] I am proud to do so, because you have sacrificed your fimdamental principles for Government control, ownership, and a bureau- cratic system, if not state socialism, and it might be inter- esting to both Republicans and Democrats in this House to know that when the Republican Party was founded it stated in its first platform that it was founded on the prtn- cii^es of Thomas Jefferson. Abraham Lincoln said that he took all of his principles from the Declaration of Independ- ence, written by Thomas Jefferson; and those principles, which made your party great for all these shears, and which at times we have departed from for centralized government, have been now thrown out of the window, bag and baggage, by your own par,(.y under this present administration. What has become of State rights and Jeffersonian Democrats? Mr. COCHRAN of Missouri. Mr. Chairman, will the gen- tleman yield? Mr. FISH. Yes. Mr. COCHRAN Of Missouri. Will the Jeffersonian Repub- lican advise us right now just what he would have done to meet the emergency that confronted the President when he took office last srear? The gentleman has told us what he is against. Let us have his views as to how he would have cured the situation. Would he have let things go along as his Republican President did? Mr. FISH. That is a fair question, and I shall be glad to answer it. I say to you Democrats that if you had gone along the way the Republicans are going along today, in the support of the NJl-A. — ^if you had gone along just after the depression, when you had a majority in the House, and accepted the sound recommendations of the Republican President at that time, instead of chloroforming them in the committees, instead of throwing them out of the win- dow, the country would have had confidence today, and we would know just where we are going, and we would be on the way out of this depression. Mr. COCHRAN of Missouri. Will the gentleman state what went out of the window? Mr. FISH. There is one thing that the Democratic Party did, on the recommendation of the then President, Herbert Hoover, and it is today the main vehicle that the Democratic Party relies upon to get us out of the depres- sion more than anything else, and that is the Reconstruc- tion Finance Corporation, the most important and neces- sary piece of legislation passed by Congress since the de- pression started. The Reconstruction Finance Corporation came into being at the request of a Republican President, and it has loaned 4 billion or more dollars to industry, in return for collatersd. It is not the same proposition at all that you propose, namely, to give away money out of the Treasury in the way of doles. I think all the older Members who were in the Congress at that time realize that if the Reconstruction Finance Corporation had not come into being, and if the Congress had not backed it up and given it these huge sums of money running into billions of dollars, the credit of the country would have collapsed, the railroads would have ceased to operate, insurance complies would have gone bankrupt, and there would have been a total collapse of credit from one end of the country to the other. I give credit to the Members on the Democratic side of the House for acceptizig a Republican recommendation, carrying it out, and enacting it into law and using it as you are today, to get us out of this depression. But the Rf .C. was no " bratn-tniat ** proposal bvt the aoand eeonomte recoaunenda- tion of a Repubhcan Presktent in a great emeiieucji. Mr. McFARLANB. Will the fsntleman ylddt BIr. FISH. I yield. Mr. McFARLANE. I should like the gentleman to maks more specific the statements he has Just broadly made, that the Democratic side of this House has Uocked and killed in Mxnmittees and thxmm out of the window legislation advocated by the Repubhcan Party that would have brought this country back to normal; and his statement just now to the effect of a change of policy of the Recousti uction Finance Corporation: and if he will explain, if he can. the operations of the Reconstmetion Finance Corporation in making loans to Charley Dawes and his crowd? Mr. FISH. Well, that is a very fair question, and I will answer it. The CHAIRMAN. The time of the gentlanan from New York [Mr. Fxbh] has expired. Mr. OOSS. I yield to the gentleman from New York 10 additional minutes. Mr. FISH. I should like to caU the attention of the gentle- man and his colleagues to the fact that his party was elected on a platform not only of sound money, that was discussed previously, but upon a platfonn of economy and balancing the Budget. The Republican administration was sincere in * its efforts to balance the Budget. It presented to the House a sales tax, which is the only possible means that I know of left to raise further revenue, and it is inevitable and you must come to it. The former administration proposed, and was backed up by most oi the Republicans at that time, to balance the Budget by a 2-peroent sales tax. That was thrown out of the window by the Democrats in the House of Representatives. After all. balancing the Budget was prob- abV at that time, and may still be today, the most important issue before the country and the only thing that is going to restore confidence in business and among the American people who have any money left. Mr. FIESINGER. Will the gentleman yield right there? Mr. FISH. Yes; I yield- Mr. FIESINGER. When did the former President ad- vocate a sales tax? Mr. FISH. About a year and a half ago, before he went out of office; and the Secretary of the Treasury, representing the President. Mr. FIESINGER. Did he not make the statement just on the eve of the passage of the tax bill in the Senate, when the Senate had agreed to pass a tax bill, and he made no other utterances about the sales tax? Mr. FISH. The Secretary of the Treasury speaks for him. I cannot recollect the specific words of the President. Mr. FIESINGER. Another question. The gentleman has stated that the Republican Party was not In favor of putting the Government in business. What did it do with reference to the Farm Board and the farmer? Bifr. FISH. Oh, we tried a few experiments ourselves, and they were disastrous, just like your experiments. [Laughter.] Now, if you do not mind, I will turn from discussing partisan issues as I should like to say a few words in the time that remains about some other matters that I had intended to speak about in the first instance. However, before doing so^ I would say this: I understand that the Reconstruction Finance Corporation bill may be reported out and come up before the House, for a continuation of the Reconstruction Finance Corporation, tomorrow or the day after, whenever the Democrats so decide. I am talking out of turn, because I do not know the attitude of my party, and I do not know the attitude of my leader, but aU I can say is that I am in favor of the extension of the Reconstructlcm Finance Corporation for 1 year. I am In favor of giving the RJF'.C. a billion dollars, if necessary, and from what I read in the papers today I do not think enough money was pro- vided for the so-called " mortgage loans." Only $75,000,000 was provided for mortgage loans. I suppose you Democrats are in exactly the same boat as we are on our skle. I know that a lot of legitimate industries hi my district, old-time 356 CONGRESSIONAl. RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 857 ^ Ixuluitrles. 50 or 60 yean old. cannot borrow money froin banks and are unable to get loans to keep going and to keep men employed, and they are entitled to obtain credt from the RJ.C. on collateral which can only make loazs through mortgage companies. Those legitimate business Interests, employing innumerable men and women, caz - not get it from the Government if we only provide $7S.OOO.0< 0 for that purpose. I should say $500,000,000 was needed at the present time. This money is loaned on collateral, aid that is a far different principle than giving it away. I should be glad to vote for $500,000,000 instead of $75,000.00 D, if we get an opportunity tomorrow. Mr. HEALEY. Win the gentleman yield? Mr. FISH. I yield. Mr. HEALBY. Does the gentleman favor direct loans o industry? The gentleman stated it was almost impossibe to arrange loans through banks, and in many instancis through mortgage-loan companies. Does the gentlemin favor direct loans by the Reconstruction Finance Corporu- tion to industry? Mr. FISH. I can only answer the gentleman by sasrin? Lf the loans were restricted and properly safeguarded, then I might favor it; but I understand Mr. Jesse Jones has n >t advocated it, and I rather think it will not go through unless the Directors of the Reconstruction Finance Co'- poration come down here and make some claim for it. Mr. McKEOWN. Will the gentleman yield? Mr. FISH. I yield. Mr. McKEOWN. I think there is a great deal in what gentleman has to say about the real necessity for indust at this time to get some money on loans. Does the ge tieman not believe that the sooner we make direct loans t better it will be for business recovery? Mr. FISH. I believe it can be done, but it must be rigid ly and conservatively restricted. That is the point. But if yt)u cannot do it and do not propose to do it. let us do it the way we are trying, through the mortgage companits, but give the RJF.C. a sufficient amount of money to lend ( n collateral to industrial companies to weather the emergent y. Mr. McKEOWN. I agree with the gentleman that somi t- thing must be done to take care of these industries, becau; e the banks are going to lose all of their business, inasmuch i ls they do not take care of either the farmers or industry. Mr. COX. Mr. Chairman, will the gentleman yield furth( ir at this point? Mr. FISIL Yes. Mr. COX. Does the gentleman favor opening up o all business the right to borrow from the Reconstructic n Finance Corporation without limit? Mr. FISH. No. Mr. COX. Does the gentleman think $1,000,000,000 a- $10,000,000,000 enough to meet the needs of Industry? Mr. FISH. No. I do not even know tlwt we ean enast legislation drastic enough to carry out any such propowl. However. In view of all the exlsUng circumstances let u Appropriate sulBclent money to relievt Jefltlmate Industnr throufh mortffaf e companies. 1 Ur. riEMDIQMK. Ur. Chttrman. will tb« g •atlem«n fi»\A lor anotlMr outtiloo? Mr, flSM. Yii, Mr, flltUfOlft. Hm ntnilraum mtd* a M«t«mtnt •ttvor. Dots tht ftntlMMn e*rt (o stAlt the iMtttlon of lUpuMiean fuHf on tho Hlvtr qutitlonf Mr. FISH. Z Mn staU only my indivklUAl vltws, but tWnli thor art tho vtowi of tho ptoplf In Now York fui Mtf the last itnorftlly. X cannot lay it If tho position tho Prwi4tQt of tbs United BUtes. who is one of my sUtuents, or perhaps Z am one of his. but bs comes from confresslonal district. X can, at least, state my own vle^ and what Z think are the views of the Republicans general y In the State of New York. I am glad the gentleman hi s asked this question, because there has been much misiii fonnation on the currency issue. Everybody accuses ever; - body else of being an inflationist because the dollar hi d gone down to 65 cents. That is not a true picture. Whit is causing fear and uncertainty throughout the land is that the commodity dollar will go lower. I think the Republicans in the State of New York would be satisfied if the dollar were stabilized at 66% cents and the gold standard restored. But if you are going to con- tinue with the fluctuating or commodity dollar, you will destroy confidence among the business interests in our sec- tion of the United States. I think this is the whole trouble with business today — utter lack of confidence in a fiuctuat- ing or commodity dollar wiiich depends upon weather con- ditions in the far West, the Middle West, the South, and even in Canada. If you accepted a stabilized dollar at 66% cents, or at 65 cents, I think the business interests of America would be satisfied. But if you are going to continue this fluctuating dollar, you will never restore confidence. If 3rou do what many Members of Congress want done and cut the dollar down to 36 cents, you will destroy all confidence in the eastern section of the United States. Mr. FIESINGEK. Mr. Chairman, will the gentleman yield further? Mr. FISH. Yes. Mr. FIESINGER. I know the gentleman wants to be fair. He said something about silver, raising up sort of a scare- crow, the old 16-to-l proposition. Has the gentleman ever considered treating silver in any way except on a fixed ratio? Does the gentleman mean to infer he is against all proposals with reference to silver being made a part of the monetary reserve without a fixed ratio? Mr. FISH. No. I think as soon as we get around to some international agreement on silver, that will be acceptable. Mr. FIESINGER. Does the gentleman think this can be done by the United States alone? Mr. FISH. No; an international agreement will have to be made with other nations. It would have to be with the great nations of the world. When they reach an interna- tional agreement on silver it will probably be acceptable to oin* party. It has been in the past. I do not know why it should not be in the future. Mr. FIESINGER. The gentleman has not given me a very satisfactory answer on the pr(|position. Mr. FISH. I have but a few minutes left, and even in the l>eginning I did not intend to take all my time talking on the silver issue. [Here the gavel fell.1 Mr. FISH. Mr. Chairman, will the gentleman yield me 5 additional minutes? Mr. GOSS. Mr. Chairman, I yield 5 additional minutes to the gentleman from New York [Mr. Fish]. Mr. DUNN. Mr. Chairman, will the gentleman yield? Mr. FISH. I yield. Mr. DUNN. Does the gentleman believe that four fifths of the world is doing business on silver? Mr. FISH. I think if that were the fact we could arrange an international agreement on silver very easily. Mr. Chairman. I want to say a few words about a proposal which, according to the press, will come from the White House either today or tomorrow, advocating and urging the ratification of the St, Lawrence ship canal. 1 think it only right that some of us Members of Congress from Nsw York, Mr. MsAS. myself, and others, should present to the Members of the House thoir views on thi/i iltuation which affscts our StaU very seriously. Z would rsmind you that the State of Mew York pays 30 ptrooni of the Fedsral taxes, Zt U now propoMd. If thU treaty is carried out, to build a oanal In a foreign country for tha purpose of diverting trade and cnmmerce from the ports of Ntw York, Albany. DuflTalo, and Byracuss, to say noth- ing of Philadelphia. Baltimore, and Norfolk and other great eastern and southern leaporU, at the expense of the tax- payers, very largely, of the State of New York. Mr. CHRISTIANSON. Mr. Chairman, will the gentle- man yield? Mr. FISH. In a litUe while, after I have made my sUte- ment. If the proposed St. Lawrence ship canal would actually benefit the farmers of the West and give them cheaper freight rates, it might be a serious matter to discuss even In the State of New York, but the St. Lawrence Canal has become a political football and is a political myth. It will -not benefit any western farmer 1 cent a bushel on the ex-, port or shipment of his wheat from Minnesota, Wisconsin, or farther west to the eastern seaboard or to London. For years these farmers have been told they would save 10 cents a bushel on the freight rate on their wheat. They have been so persistently propagandized that it has become a p(^tical issue. The fact is, however, that the freight rate at the present time is only 4 cents and they will not save anything at all. We in New York are not raising an awful howl because we pay 30 percent of the taxes to destroy crops in the West or to pay for the birth control of hogs, or pay for farm relief generally, but when it comes to diverting trade from the city of New York, and the Hudson River and up-State cities at the expense of our own taxpayers, and then spend that money in a foreign country, our people do object and protest vigorously. I am opposed to spending any money in any foreign country, whether it be Canada. England, Ger- many, or Soviet Russia. The St. Lawrence ship canal is an economic imbecility and a fraud upon the farmers of the West and the consumers of the East. Mr. PATMAN. Mr. Chairman, will the gentleman yield? Mr. PISH. I yield. Mr. PATMAN. The gentleman does not seriously contend that the State of New York is 30 percent of the processing tax, does he? Mr. FISH. No; not that. Mr. PATMAN. That is the source of the money used to take care of the crop-reduction program. Mr. FISH. Not any particular crop. Mr. PATMAN. What crop does the gentleman from New York refer to? Mr. FISH. I am referring to Federal expenditures. Mr. PATMAN. I wish the gentleman from New York would name one crop in r^ard to which the State of New York pays 30 percent of the processing tax. Mr. FISH. I am not discussing the processing taxes, but all possible taxes. Mr. PATMAN. Not every possible way; just name one. Mr. FISH. I am talking about Federal taxes generally. Mr. PATMAN. But the gentleman said crop reduction and the cutting down of hog production. Mr. FISH. It does not make any difference, as the con- sumers in the East will have to pay the bill ansrway for the increased cost of western foodstuffs, whether by taxes or by high cost of living. Mr. CHRISTIANSON. Where do you suppose a great deal of the income, upon which the people of the State of New York pays Income tax. comes from? Mr. FISH. I think the gentleman realizes that we do pay out huge sums and have been paying out huge sums for relief ptuiioses in your State, probably far more than your State gives into the Federal Treasury, But wc arc not raising that issue. We raise the issue today merely that the St. Lawrence Canal will not benefit your farmer«, that you made a political football out of tt and It will not benefit ihem one cent, On the other hand, it will take trade and eummt»rv«i from the ea^turn and ntnUhfrn (wuboardi, where 904)00,000 consumers and the Mms mmtm of wage earmtri will be the losernt. and will not bf^neflt the fsrmeni one cent, ■•cause you made the At, Lawrenrs ocesn Nhlp canal a po- litical football and beeauM it Is a political myth, you wsst- •rn Memberi have to go along M\d say; "W« cannot go back on our promise, This is the way to afford relief to the farmers," Mr. CHRISTIANSON. Does the gentleman contend that support of the St. Lawrence waterway Is any more of a political football in the Middle West than the opposition to it in certain parts of the State of New York? Mr. FISH. Yes, I do; because you can do actual harm, srou can destroy the trade of the eastern and southern sea- ports and particularly the port of New York, and it cannot benefit your people. If it could benefit your people it would be a different matter, and I would be wUllng to dJscuas the merits of the proposition; but as It is. why spend American dollars in Canada to ruin the shipping Interests of the United States? The CHAIRMAN. Tte time of the gentleman has expired. Mr. WOODRUM. I yield the gentleman 5 additional minutes. Mr. FIESINGER. A gentleman on this side calls my at- tention to the fact that the gentleman from New York made the statement in colloquy here that there were some Mem- bers on this side of the aisle who were in favor of S5-cmt dollars. Will the gentleman, if he did make that statement, put into the Rbcokd who those gentlemen are? Mr. FISH. No; certainly not. I would not think of put- ting it in the Record. I have heard individual opinions ex- pressed as to the dollar going down lower than that. I am opposed to the dollar going down below what it is today. I know that the Congress has authorised the President to de- value the dollar to 50 cents. It has not reached that point as yet. I will not cross that bridge until I get there. I will tell you what the gentlemen on this side want. We want to stabilize the dollar at 66% cents, and certainly not below 60 cents. Mr. FIESINGER. We want to stabilize it. too. Mr. FISH. If Congress will stabilize the dollar, confidence will be restored in America overnight. Mr. PATMAN. Will the gentleman yield? Mr. FISH. I yield to the gentleman. Mr. PATlklAN. I understood the gentleman to make the statement that there are Members in this House advocating a 35 -cent dollar. Was Uiat statement made? Mr. FISH. If those were my words, then, of course, your statement is correct. Mr. PATMAN. The gmtleman was really mistaken about that? Mr. FISH. No. Mr. PATMAN. Will the gentleman name those Members? Mr. FISH. I certainly will not. They advocated that openly, but in a personal conversation off the floor of the House. Mr. PATMAN. Name the Members who are advocating the 35-cent dollar. Mr. FISH. I am not going to embarrass the gentleman. I wiU say that some Senators of the United States also made similar statements. Mr. PATMAN. Does the gentleman mean in the other body? Mr. FISH. Yes; in both bodies. Tben are Senators of the United States advocating S5-cent dollars among their friends. However, they can speak for themselves, but I hope that they wUl see the Ught beforehand. Mr. PATMAN. The gentleman cannot name a single one? Mr. FISH. I ceruinly can name them, but I do not pro- pose to do it now. The Republicans are fearful It will go below that if some of the inflationists among the DemocraU have their way. Mr. PATMAM. Mow mu«h below thatt Mr, FISM, Z will not name that figure, tlther. except to lay one of the older Republican Members of the ffour.f , who dtioste the rubber dollar, prodloU the dollar will go to 30 cents. Mr. MAY, When I Itft th# Ohambtr a ftw minute* hvo Z undtrtteod Hts gentleman from Mow York was taking eg. eeptton to the atiltudo of tha Z)tmocrallo majority in d«- parUng from (he prlnclpiof of Jtffarson and gtnfraUy vlo- Uting the Constitution of (bo United Statft. Z want to ask the gentleman whether or not be agroes with the noted and dUtinguished Chief Justice of the United States Supreme Court, who was Republican nominee for President in 1016. on the question of the adaptability of the ConsUtutlon of the United SUtes to present oonditionsf Mr. FISH. I am in entire accord with that opinion, and I think it is absolutely necessary, both in emergencies and in war. I am glad the Supreme Court has decided tiiat the Constitution has that elasticity, and I do not think we are sacrificing anything, either. I hope we will return, however. 358 CONGRESSIONA ill ! RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD—HOUSE 359 to i>eaceful and prosperous days when the Constitution wj II be construed normally. Mr. CHRISTIANSON. Will tlie gentleman yield? Mr. FISH. Yes. Mr, CHRISTIANSON. The gentleman mentioned the contribution of the State of New York to the cost of tlie building of the St. Lawrence Canal. Has the gentlemsn made an investigation as to the contributions made by tl le people of the Middle West during the last three quarters i >f a century to the development of the various ports and wate: - ways of the State of New York? Mr. FISH. I caimot give you the figures. Mr. FIESINGER. Is the gentleman in position to glie us comparative figures as to your contribution to the watcj"- ways as against our contributions? Mr. FISH. Oh, certainly. In the State of New Yo*k which you refer to, the Federal contributions have not be^n very large toward our waterways. Mr. CHRISTIANSON. We have been spending money ^n your waterways for a half century or more. Mr. FISH. I know all about that. If the gentleman refers to the Eastern States, that Is a different thing. T) le Federal Government has not spent very much money in oi u- particular State, because we only have the Hudson Rivmr. The Hudson River is navigable for 150 miles and it does nbt need Federal appropriation except for the last 10 milt^l*(tHmthftii>« IH MH fimiH'NliHl, t i\s\h%> M (H'HM f HUlVlHIiaiHM Hf IH» (^MH«MlMt|tm «liMt*HH|l|} hf Ut»»>P HHlHMlii n«>i»ut(iu«aMff 'rhp H#HuNii(>tiH NHv ill M\ Hi Hit lit nm» tmihv wiih Mmvihn nII th« iimPfiiPhi>y iPiitHUIitiH mMfli pit* IMMIIPia. W» llHlll flH'WaM IH tltO itHV WHPM M MNMlt \mi Ul iliM IhhUIiiiI'im will iNi wiM uiH wK»H ih« »m»ri»M«)y III ovpr Miiit wp will NPt toaitli (d U\t (JuiMdiuMon »nd Id our Ainpi't(i«n irmMtuManii, now (prnpiirarlly loAdPa down wiiU uiuuuna an4 Nooiaitiiia PN)iPrimpiUff. Mr iHORMAXKR. Thp point I wantPd to m%U l« thkt the Farmer 'Labor Party is very proud that thay have blamed the way and the Supreme Court of the United Statsi has placed its stamp of approval upon it. [ Mr. FISH. There will not be any Farmer^Labor Par^y left when we get through with it next year. [Laughter a^d applause.] [Here the gavel feU.l Mr. WOODRUM. Mr. Chairman, I yield 15 minutes to t^e gentleman from New York [Mr. MkaoI. Mr. MEAD. Mr. Chairman, it is going to be very easy fbr me to agree with my distinguished colleague from New Yo rk on the question of the St. Lawrence waterway, but because of my loyalty to the principles of the party of Thomas Jeffe r son, it Ls going to be most difficult for me to agree with t le statement he made with regard to changes in out paity principles. So I will have to agree with some parts a|id disagree violently with other parts of his address. When the gentleman talks about the philosophy containfed in the NJl-A. and the new emergency set-ups of govern ment and the fact that my party is drifting away frcm the time-hcnored traditions of our great founder, let lae remind him that in the days of Thomas Jefferson It was his eager desire to bring the protective influence of government down into the hovels and homes and to the firesides of America. He saw in government an instnmientality for the protection of the poor and the weak, and in keeping with this philosophy, the great student of Jeflersonian principles who now guides the destinies of this country in the White House is bringing the full protection of government to the masses and applying it in the same way as did Thomas Jefferson in his day. It is the weak, it is the workers, it is the farmers of the country who make it necessary for the Democratic Party to adopt the principles contained in the Let me say to the gentleman that the day is past when we will be guided longer by that theory which the Republi- can Party has been expounding in recent years, that of rugged individualism in a machine age; the theory of less government in business and more business in government in an age of stock speculation and bank swindling, in an age when big business drives small business out of existence. It is these elements and influences which are looking to their own selfish ends and, of course, they are shouting for less Government restriction or interference. There is a difference in the condition of the Thirteen Original Colonies of Jefferson's time and the 48 States of Roosevelt's day. The Democratic Party is keeping faith with the masses of the people and representing them and protecting them, and we are not going back to the uncon- trolled system which the Republican Party would like to espouse at this time, and we are not going to the extreme left and adept State socialism or government ownership. We are going to accept and support the reforms included in the emergency legislation which has been adopted, and by these reforms we are going to see to it that the masses of our people have the right and the opportunity which a democratic government should bestow upon its people. We are going to add to the constitutional right of life and liberty the right to work, and this is a right which did not seem to worry the laflt Republican admlnintratlon, and this is why the dettiocratlc Party li In power, For this rpason we are not huImk to deviate to Itip fight nor the Wt, but we are Ntitnti td mnkti a giir<(*(*iiii af th9 mm (•(^onnttiifi philoAtiphy. and W0 nktc pnittM it» t>p9> in H (hat 4hi> mntAhiHe r^f a new day ciittiPM id (np AitifHi'aii WMiJifi' and litp AMti>i'ifMh rafHtPC. I AUMlnuiiP' I t may mv Ih Hiy iHMiMMUloltPfl »MMNP I l4PllPVP tltat WP Itavp NPlpoiPil Hip vpiv iNitt PPUIMMMUi HVNtoMI ut HIIV nallMh Mi) PMI'tl), Wp I'PiUlH all that u HMMii In unvMtP tiupiuppi »Ha w« Nhuii all tliMl u »vU In AtftiB QwiiPi'Nnip. Thprefura J luy, Mr, Chairman, thU lyitem li h»rp to ptay, Tha country will never tulurtttfl a return to the much- heralded ruBied IndividuaUim or the theory of less govern- ment in buainess and more bualneaa in government. We are going on with the new deal until it becomes universally recognized, not only in America but all over the world. [Applause.] Mr. ADAMS. Will the gentleman yield? Mr. MEAD. I yield. Mr. ADAMS. I do not want to distract the gentleman's attention, because he is making an excellent speech, but in speaking a few minutes ago did I understand the gentle- man to say '* rugged " or " ragged " individualism? Mr. MEAD. Well, it was rugged individualism, but by reason of the way it was applied by reason of the lack of interest in the individual under 12 years of Republican ad- ministration the rugged individual became a ragged indi- vidual. [Laughter.] Then the Democratic Party came to his support. I desire now to agree with my distinguished colleague from New York, and it is a pleasure for me to go along with him with regard to this particular subject. The gentleman frtHn New York. In his speech, said something about the St. Lawrence waterway and its effect upon the country, as well as its effect upon the great State of New York. Some- one in the course of the gentleman's remarks made an ob- so^ation with regard to the contributions made to the waterwajrs of the State of New York by the United States as well as by other States. I may say to you that the State of New York has the best system of inland waterways of any State in the Union, and the State government paid for that system with its own money and without outside help. I want to say further that we are spending more money on our waterways than any other State in the Union. We are happy to contribute to the waterwas^s in your State, but we are violently opposed to the contribution of American money to build a canal in foreign territory. Now, I want to say something to you about how it will affect labor, and the mining interests of the country. In order to be accurate I have jotted down some of my ideas on this subject. Under the terms of the St. Lawrence Treaty all funds supphed by the United States and expended for work in Canadian territory must be utilized in the employment of Canadian labor. Canadian engineers, and Canadian ma- terials. The report of the engineers, upon which the treaty is based, estimates that $55,000,000 of American money will be expended uiKjn canal works in Canadian territory. Judging from the amount by which the cost of the Panama Canal and the cost of the Welland Canal exceeded the engi- neering estimates, more than $100,000,000 of American money will go to Canadian labor and Canadian engineers. That Canada was on the job protecting the interests of her labor at the time the treaty was written is shown by the following editorial, dealing with the St. Lawrence Treaty, which appeared in the Toronto Mail and Empire on July 18, 1932, Immediately after the treaty was signed. OAHAmAN LAaoi AND MATUUAUI Mottt Of the eotiBtruetton work will done In C&nAda. All the eotintniction work on th« nitlonal srctton will, of cotirne, be don« here, but there ti more than that. Though the t7nii«d Slate* le to provide the 194,71(1,000 for work* ilttifltetl on the Canadian Aid* in the tnternHllohMl nHtiirl* ^t^Hton, CflnntliMn rngineem, Oanadlan latoof. and danadlHti niaiefiHle ife to be uepd AttttroMimMipty MO tipri^pni nf thp t«upi nf WiiPfWay Im' MMivpmPHip Id id lnHuh Willi tnilllHHA rtf hiph mil »f wink IM IhP 1;hIIih •tMtPN hiiw i«an am tluvpHiMipnl Jimlify ihp in* UPlKlliUfP Uf M VAUi M iiUtl Ut AitlPill'Mll IIMHIPl/ fil^ (JaitttlllAH ialiHH tlnnailM hPN NPrvpil m a vatwahlP nmilipt hv AhipcIpmh pimli Tlip UMimillfiii HiailiPl, in iPMPMt ypaip, tiM pnniiuinPil H|iMrimiiH»tPlv }Y,(M)U,00ti Imhn nf Ainpi'ii>aH Miml Miiiumllyi (Jpim4M WM formpi'ly a valiialilP lupiltPt fur AiiiprlPii itn> tUrHPitP, With only » li^fuut tilmnitPl nuw hvhUiiIiIp auwn tUp Mt. l^wrenpp wp ara IoaImk our Caimdmn RiUhraPltP niHrkPt to Qi'pat nrltitin. In ISilO Canada ponMumert 0ttfl,ua torn of lii-iti«n anthracite aiid a,9A&,064 tonti of American anthracite. In 1932 Canada oonpumed 1,199,080 tonp of British anthracite and l,09B,ft32 tons of American anthra- cite. Thua far this year Canada has imported more anthra- cite from Oreat Britain than from the United States. The St. Lawrence Treaty provides for a 27-foot seaway from all the ports on the Oreat Lakes down the St. Lawrence and out to the sea. Port Arthur, on the north shore of Lake Superior, is adjacent to the wheat fields of Canada, and more wheat now passes through that port than any other port in the world. When a 27-foot seaway becomes available foreign-flag ships, manned by cheap foreign labor, will transport Canadian wheat to the world markets at Liverpool and other European ports, and for want of return cargo these foreign ships will carry British coal into the Great Lakes as ballast without regard to remunerative rates. Brit- ish mines are unionized, which affords some guarantee to the American miner, but if the cost of transporting British coal into Canada is practically eliminated, our Canadian market for 17,000.000 tons of coal annually will soon dis- appear. The National Congress of Qec^glats in 1913 reported that Russian coal resources amoimted to 231.440.000,000 tons, of which 55.600,000,000 tons is located in the Dcnetz Basin near the Black Sea, and that 37,599,000.000 tons of this amount consists of a high quality of anthracite. Russian geologists more recently have reported that the coal resources of Russia amount to 428.300,000,000 tons, of which 54.100,- 000,000 tons are anthracite. In order to visualize the enormity of the Russian coal deposits it Is well to know tha^ Pennsylvania anthracite resources in 1913 were estimated at 16.906.000.000 tons while those of Wales were estimated at 8,685,000,000 tons. The Coal Section of the Minerals Division of the Bureau of Foreign and Domestic Commerce, Washington, report* that approximately 150,000 persons are employed In the coal mines of the Donetz Basin and that coal-cutting machines are being rapidly installed in these mines. The Economic Review of the Soviet Union reports that their coal-produc- tion schedule has been set to increase at the rate of 4.000,000 tons annually for a period of 10 years, at the end of which time the annual production is expected to reach 70.000.000 tons. Ol&cial records in Washington show that 201,113 tons of Donetz Basin anthracite was imported into the United States in 1932 and 103,073 tons during the first 6 months of 1933. and the coal experts advise that an analysis shows that Russian anthracite is of a much better quality than either Welsh or Pennsylvania anthracite. A 27-foot channel from all the Great Lakes ports down the St. Lawrence will provide low-cost water transportation and will open up enormous markets for Canadian products in the ports of the Mediterranean and Black Sea. When the St. Lawrence Is completed Canada will have an un- limited supply of the cheapest power in the world which will enable her to build Induatrlea on the banki of a sea-golnt canal. Canada's liberal immigration laws will permit theae industries to operate with cheap labor. With cheap labor and cheap power and indtistries on a aea-going canal Ca- nadian products will compete in ih* tnarketa of the Med* iterranean and the tHack tt9ft4 The Ruaaian coal tnihea now beltui rttpidly devplopvd in the Doheitf llMiH it* only 100 milM from ih« ttUtti Met. rhtMi when the Hi. UwtcnM peaway 1« eotntitpipd and Ui* HiMllin itfuduH'H of vifloup tiin4l« beittn U» dpvploit maflipU ACtfiihM tHP MPlUKPH'aHPltH iH4l IH« n\Mk MPM, tllMh-MMllll ntMPlAH MHtHfitfltP iHfl »ittPI' MMPPlAh IHHti Will \t¥ NVallablP M CPlUfft I'MfHWPA Mltll ftir WAdt Hf MlltPf l«iNM ht^mh»l\M PltlMII Will ¥Mn UllM I'HHI IHIM UtP (4lMi t^Mft M MalUpi Willi lltllP llHmMllt Wf IPIHUMPIHtlVP IHtM. Mwt Hitly Will thiN ilpftliiiy i\w PHlPtliiM (lanaiiiNM MiailiPi Im AiHPiii'iiM iiMNl It will iPiiimtMi^P PMPli HiailiPlA m HUi KvUif, Pulutli, MIIWMUkPP. Oniftttfii. Nupt VUi^ninu, (-lary, itrult, Tfilpau. Pltvplana. HultulM, imd nmny MtliPr pitlew (in thP AinpMPMii piOp Mr tlip Uri>Ht UkPN. Hup wuuia up* riouply thipptpn (hp pppI IndUPtry u( thP Umiml Mtatpa, Hupilan poal mlnpp are owned by thP ioviet UuvpinniPnt, That aoverrunpnt U not diPturbed about thP waaep of lU minert, and it will be a dUBouli problem for labor In Amprlcan minea to compete with miners who work under the Russian pyitem. KAILWAT LABOa American coal, now transported to the Canadian market, as well as American coal transported to American cities around the Oreat Lakes, constitutes a very substantial ton- nage for the railroads. If Russian coal, mined by Russian labor, can be transported as ballast to Canadian ports and to Great Lakes cities on the Anaerican side, it will destroy these markets for American coal. This will eliminate a sub- stantial amount of tonnage now carried by American rail- roads and will thereby deprive a large number of American railway workers of employment. Now, what is going to happen? It does not make any difference to the Soviet Oovemment what wages they pay miners. They have little concern about that. They will see that the ships are returned to the Great Lakes loaded down with Russian coal, mined by Russian labor, to the great detriment of our coal industry. 360 CONGRESSIONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 961 That CaxuMla was fully conscious of these possibilities Is Indicated by another paragraph in the editorial of th^ Toronto Mail and Empire, which reads as follows: 6SSAT ST. UiWMXttCm UfSUSTKIAL UBGION It Is probably not going too far to predict that with this ne^ canal and power development on the St. Lawrence River, wit a little cost to Canada, the Great Lakes region and St. Lawrence Valley wUl. In the next few years, be lilted into a place of Indu,^ trial leadership. What about the American seamen? We boast that l^ reason of the passage of the La Follette Seamen's Act t American sailor stands out as the only 100 percent free that sails the sea. The CHAIRMAN. The time of the gentleman from Ne York has expired. Mr. WOODRUM. Mr. Chairman. I yield 5 additionil minutes to the gentleman from New York. Mr. MEAD. We are going to destroy the elTectivenej s of that act. because the only American waters wherein tl:e high standards prescribed by the La Follette Seamen's Ac ;, wherein the American seaman does not have to compete with the oriental of the east, or with cheap European lalx^ the only place where we now enjoy unexcelled opportunitty to develop an American merchant marine, is the Great Lakes, and it Is now proposed to open up those waters to the tra£Sc of the world, to the tramp steamers of eveiy nation on earth, and to sink to the very lowest the hlga standards of American workers that now find emplosrmeiit on these lakes. Let me say to you, my friends, before you give away an American lake — and there is in this treaty an agreement to internationalize Lake Michigan, which s now our lake — before you give away an American lake and in retiim build a canal in a foreign coimtry over which yo u wiU have little control or Jurisdiction, think of the damage that may result to American shipping, to American rai - road interests, to the American worker, and to the America q farmer. Just listen to this, please. AMniCAN SBAICZN The La Follette Seamen's Act was passed by Congress fcr the purpose of insuring a fair wage and decent living cor- ditions for American seamen in the merchant marine, if a 27-foot seaway is constructed from the Great Lakes ports down the St. Lawrence to the sea, foreign-flag ships will te free to engage in commerce between all the Great Lakes cities, on the one hand, and Cuba, Mexico, Central and South America on the other. What chance has an Amei- ican-fiag ship, paying the American wage scale and main- taining American standards of living, to compete in com- merce with ships fljrlng the flags of Japan, China, Belgiimu Norway, Sweden, Germany, France, and Italy? What chanc e have American seamen, under such conditions, to compete with such foreign labor? Furthermore, foreign-flag ships, manned by cheap foreign labor, will be free to come into th e Lakes and engage in commerce between all the ports on tlie American side and ports on the Canadian side. This mear s ruin for American labor now employed upon the Qrett Lakes. THS AMXUCAN rAKMXIt Tlie St. Lawrence Treaty, If ratified in its present forti, will reduce the diversion at Chicago to a point which wfll make a commercially useful Lakes-to-the-Gulf waterws y impossible. The seaway proposed by this treaty will provic e cheap transportation from the Canadian wheat fields to tt e world markets and will place the American farmer in sue 3 States as South Dakota, Colorado, Nebraska, Kansas, lowi. Missouri, Illinois. Elentucky, Tennessee, Arkansas, and Okli - homa in a position where he cannot compete with Canadia i wheat in Uie markets of Europe and the Mediterranea i ports. The water rate on wheat from Chicago to Liyerpo(»l through the New York barge canal Is now 9 J cents ptr bushel, or 16.5 cents per 100 pounds. The proponents of tl; e St. Lawrence Treaty insist that this rate will be substaz- tially reduced when a 27-foot seaway becomes available fn» a the Great Lakes ports down the St Lawrence, and to jurti» the vast expenditure proposed upon this seaway this im- provement should insure a rate of less than 16 cents per 100 poimds from the great Canadian wheat port to Liverpool. If you shut off a Lakes-to-the-Gulf waterway, how can the American wheat farmer compete with the Canadian farmer in the markets of Europe when the rail rate on wheat from Pierre, SJ>ak., to Duluth is 34.5 cents per 100 pounds; from Lincoln, Nebr., to Chicago, 28.5 cents per 100 pounds; and from Topeka, Kans., to Chicago, 29.5 cents per 100 pounds? It will cost the American wheat farmer more than twice as much to transport his wheat to a Lake port as it will for the Canadian farmer to transport his wheat from the Lake ports to the world market. This presents a serious problem for the man who works on the American farm. In the face of these facts, can it be said that the St. Law- rence seaway will benefit American labor? On the con- trary, will it not distinctly jeopardize the American coal miner, the American railway worker, and the American farmer? When so large a part of American labor is made to suffer, the whole working class of the Nation will feel the shock. It would seem the part of wisdom that American labor should study the proposed St. Lawrence Treaty and make sure whether its interests are protected before it is too late. You can see that by touching American and Canadian lake ports and then touching again at Central and South American ports, ships are not in violation of our coastwise law, because they are touching on a foreign country before departing from the Great Lakes, you, therefore, destroy that protection which has been a real protection to the ves- sels engaged in the coastwise trade. Mr. JOHNSON of Minnesota. Mr. Chairman, will the gentleman yield? Mr. MEAD. Yes; I yield. Mr. JOHNSON of Minnesota. I agree with the first part of the Congressman's speech, but I cannot agree with what he said later on. I want to ask the gentleman a question, and I think he will agree with me, that we are landlocked up there in the great Northwest that I happen to represent in Congress. And I want also to ask him this. He does not mean to say that he would like to treat the States up there as stepchildren, compared with the rest of the States in this Union. Mr. MEAD. I shall be very glad to answer the gentle- man, who is now a colleague of mine on the Post OfBce and Post Roads Conmiittee. I do not want to interfere with the progress of any State or section of the country. I merely call attention to the fact that if you open up this seaway in order that 3rou may gain access to a certain portion of the markets of the world, you are destroying the best market on earth for the American farmers of the Northwest. Let me remind my friend that the State of New York, prosperous and employed, is a better market for the United States products than all of South America. You believe, by constructing this canal, that you might sell your wheat abroad. I am trying to safeguard for you the best market on earth for the American farmer, and that market is right here in our own country. I am willing to build canals and Waterways with American money, but not when the economics indicate that it is to the eternal damage of our country. Mr. SNELL. Mr. Chairman, will the gentleman jdeld? Mr. JOHNSON of Minnesota. Mr. Chairman, will the gentleman yield? Mr. MEAD. First I want to answer my distinguished colleague from New York, the only Member of Congress from my State who is for the St. Lawrence waterway, because it rims through his district. Mr. SNELL. The gentleman is right; i am for it and for a very good reason. I know something about the whole proposition. Mr. MEAD. That is a good reason. Mr. SNELL. Which I shall explain to the House in a few days, when I shall answer some of the statements that the gentleman has made. The gentleman says that imder the inovlsioDs of this treaty we would give away a lake. Will the gentleman tell me what provision there is in the I treaty by which we give away anything like a lake? Mr. MEAD. Perhaps in order to gain some added em- phasis I am giiilty of using words that ought to be changed. If I were to change them I would say that today Lake Michi- gan belongs to the United States and by the treaty it becomes an international body of water, and if I had my way it would belong to the United States and never beccune internationalized. Mr. SNELL. Hie gentleman and I are agreed upon that. Mr. MEAD. But in the treaty, by virtue of an agreement, made by the United States Commissioners — and those Com- sioners, in my Judgment, were attempting to ssmchronize their opinions with the opinion of the then Presi^nt of the United States. Mr. Hoover, who was for the canal — ^the Comml8sisition? Mr. MEAD. If the proposition were as stated by the gentleman from New York it would be. but I think he has misunderstood it. Mr. SNELL. I do not believe my statement can be suc- cessfully contradicted. It is an entirely fair and absolutely accurate statement of facts. Mr. MEAD. I may say to the gentleman from New I'ork that I heard the direct opposite of his statement reiten ited with greater emphasis. Mr. SNELL. I am discussing facts, not making an ai gu- ment. Mr. MEAD. In the matter of the allocation of crelits, I still maintain the American Government is the loser; I still maintain we suffer a financial loss. I feel that the Toronto Mail and Empire was correct when it stated ihat the Canadian Government will profit most, that Canao you know that the Board of Army Engineers sent up there under President Hoover, according to the record as I read it, were in violent disagreement be- cause the plan the Canadian engineers wauted them to adopt was the most expensive one? And yet the President of the United States admonished the engineers to come to an agreement; therefore they accepted the most expensive plan from our standpoint. [Here the gavel fell.l Mr. WOODRUM. I yield the gentleman 1 additional minute. Mr. COOPER of Ohio. I would like to ask the gentleman from New York, if the improvement of the St. Lawrence River is going to be such a detriment to the United States of America, why is it that the President of the United States, Mr. Roosevelt, is going to send the treaty down to the Senate and ask them to ratify the same? Mr. MEAD. Let me say to the gentleman that I have not assiuned the power or prerogative of speaking for the President of the United States, but if he is for the treaty I am just as much in opposition to him on that proposition as I was to President Hoover, who. perhaps more than the present President of the United States, is responsible for the treaty now being in the Senate. While I am not much of a propheU I believe the Senate will reject the treaty and after that we may have a real economic survey. [Here the gavel fell.] Mr. WOODRUM. I yield the gentleman 1 more minute. Mr. SNELL. The gentleman will admit one thing, and that is regardless of everything that has happened, the St. Lawrence River today carries more real commerce than any other river on this continent, or all the rest of them combined. Mr. MEAD. The gentleman at the beginning of his state- ment said that I would admit one thing. I will not admit that one thing. Mr. SNELL. That is a fact ansrway. Mr. MEAD. I doubt it, because you are taking in too many rivers and covering much territory. [Applause.] Mr. SNELL. But there Is more real commerce there than there Is on all the rest of our rivers combined. You have to admit that. Mr. WIGGLESWORTH. Mr. Chairman, I yield 15 min- utes to the gentleman from Minnesota [Mr. Lundken]. Mr. LUNDEEN. Mr. Chairman, on Monday. January 8, the Supreme Court of the United States rendered a very im- portant decision, and I think we should have the complete text and footnotes of the decision and the law of Minnesota extending the time in which mortgaged property can be redeemed in the Record for the information of the Members, including certain newspaper comments concerning that deci- sion. I ask unanimous consent that this matter be inserted in the Record. The CHAIRMAN. The gentleman from Minnesota [Mr. LuNDEEN] asks unanimous consent to incorporate in the Record the decision of the Supreme Court of the United States and certain other matters referred to. Is there objection? There was no objection. Mr. LUNDEEN. That opinion is not only an Important opinion, but it is vital and historic. I want to call attention to the law and the opinion as rendered by Chief Justice Hughes and his associates. Justices Brandeis. Cardoso, Stone, and Roberts, who Joined in the majority decision. In the State of Minnesota we had an emergency, as you gentlemen have had emergencies in other States of the Union. We will not discuss why that emergency came on. We might differ on that. However, the emergency was there, and it was estimated on the floor of the legislature that some 50,000 mortgaged homes and farms were involved in fore- closure or possible foreclosure: that a popoIatloQ of 250.000 out of Minnesota's 2,600,000 people were affected. Our Governor. Plosrd B. Olson, of Minnesota, the first Farmer-Labor Governor in America, recommended laws along this line. Our attorney general. Harry H. Peterson, the first Farmer-Labor attorney general in Am^'ica. intervened in defense of the law. Our attorney general and members of the Farmer-Labor Party drafted this bill, which became a law. I regret exceedingly that the gentleman from New York ventured the prediction that the Farmer -Labor Party woold disappear in the next election when it came into combat with one of the older parties. I venture to say that it will be a cold day in Minnesota befm^ the old party there that he referred to will run the Farmer-Labor Party to cover. We have a Farmer -Labor Governor tJaere; we have a major- ity of members in the hoii.se of representatives and many senators in the State senate of that State and Members of Congress. We expect to increase our strength. That may not be a popular statement to make on the floor at this time; however, I think it will be more popular later on. This decison concerned a contest between human rights and property rights. The declsi(Mis and law seemed to be all against our position, except possibly in the rent cases. But the emergency was there. There has been a great deal of discussion as to other bills recently passed, being cfmer- gency legislation and coming under the wing of this deci- sion by the Supreme Court. That matter I do not wibh to discuss at this time. I do want the American public to know about this most-important Supreme Court decision, and you gentlemen have kindly given consent that this great opinion by our Chief Justice be read into the Rkcou for the information of the Members of Congress and the American public. Many people have asked for the text of the opinion. I am informed it will be ready for distribution tonight. I make these few remarks now in order to call your attention to the matter, because it is of vital and his- toric importance. WOKLD WAB VSraum' ADJUSTKB COMI'SNSATIOH I can hardly refrain at this time from calling the atten- tion of Members to another matter. There is on the Clerk's desk a petition to discharge the committee from considera- tion of the Adjusted Service Compensation Act, commonly called the bonus bill. Mr. DUNN. Will the gentleman yield there for a ques- tion? Mr. LUNDEEN. Certainly. Mr. DUNN. Will the gentleman please tell me how many signatures are on that petition? Mr. LUNDEEN. There were 54 signatures on the petition yesterday. I do not know bow many have been added today. Mr. DUNN. How many signatures are required in order to discharge the committee? Mr. LUNDEEN. One himdred and forty-five. I thank the gentlMnan for his interruption, and we must see to it that the number of 145 is reached so that this great measure may come before the House. Mr. DUNN. I agree with the gentleman. Mr. LUNDEEN. I thank you, and I want to say also that I would like to have the name oi the author of the bill on the petition to get the bill out of the committee. Tbe author of this biU HJi. 1, introduced the measure and tbe bill is sleeping away and resting in committee. This bill will bring out $2,400,000,000 which will be paid in currency to the soldiers and their widows and oridians, and there are more than 83.000 of them in tbe State of Minnesota. It will give the State of Minnesota alone $54,000,000 and the city of Minneapolis $11,000,000. and yet I do not see the name of the author of the bill on the peti- tion on the Speaker's de^ to take the bill out of committee. I should like to have his distinguished name- there, and I know that when he does put it there it will bring another 25 or 30 signatures of able and well-known DemocraU. and we need the help of the Democrats with tbe overwhelming majority that they have in tbe House. IQQA r.nMnpF.QLQTnM a t . wwrnpn whtt.qi?- 364 CONGRESSIONi lL RECORD— HOUSE January 10 Ifr. TRUAX. Win the gentleman yield? Mr. LUNDEEN. I yield. Mr. TRUAX. Does the gentleman know what Mero^r of Congress Is the author of the bill? Mr. LUNDEEN. Yes. indeed; the very able and distin- guished gentleman from Texas. Ur. Patxak. He has a ^ry good bill there, and we want him to get up and fight on [his floor for the bill that he is the father of and which he introduced here. We want to see him walking down the fdsle of Congress and tilting his lance against the enemies of the soldiers of America. Mr. McFADDEN. Will the gentleman yield? Mr. LUNDEEN. Tes. Mr. McFADDEN. The gentleman says that 145 names are required. It is reported in the press that the leadership of the other side is proposing to increase that to 218. Supi ose before 145 names are signed to the petition the mm ber should be increased to 218. what would be the position of the present bill? Mr. LUNDEEN. It would be in a very serious and perilous position, and I hope no such rule will be put over in ihis House. One himdred and forty-five is bad enough. I sh( uld like to cut it down to 100. KXFCAL TKS VICIOtTS, BVUTAI., AlfD INRTTMAN BCOMOMT ACT I also want to call attention to another bill my peti ion for which rests on the Speaker's desk, and that is a bill for the repeal of the vicious, brutal, and inhimoan economy law which cut and slashed the pay of Federal employees md which cut and slashed pensions and compensation for our veterans, cutting and slashing Civil War men and tneir widows and orphans, a bill cruel and devastating to my Spanish-American comrades, their widows and orphans. We want to repeal this law and strike it from the sta ute books of the United States. I had the honor to introcuce the first bill to repeal all of the so-called " tconomy la w ", a law destructive to veterans and Federal employees. I should like to see my colleagues here on thtf left zrake their party the soldiers' party that it was for 50 years after the Civil War, when they missed only one Presidency ir 50 years, because within the ranks of the Republican Piirty they had the soldiery of America, and if they have not learned their lesson now, they will learn it in 1934 and 1 )36, and they had better heed counsel at this time. IXrtNAMCK FAKM AND BOMX LOAMS — TfCB nUZZZI BIU. There is another bill up there on the Speaker's desk hat has seme 65 signatures, and that is the Frazier reflnani ;ing of farm and home loans bill. I should like to see 145 names on that petition to help the farmers of this great Nation of ours. The author of the bill sits on the floor of this House, the gentleman from North Dakota [Mr. LncKi], and Senator FiAzxn is over In the Senate, and they are both battling for this bill. We shi mid have 145 names on this petition. Mr. KVALE. Will the genUeman yield? Mr. LUNDEEN. Certainly. Mr. KVALE. Is it not true that at the present tlmis 23 State legislatin-es have memorialized Congress to pass this measure? Mr. LUNDEEN. I am tnfonned by my friend and ooUe4ffue here on this floor Uutt 23 States have memorlaliMd O In favor of the Tnain MH, and I believe after the llcan and X>emoer»tle Parties have been flgtittng tl into each other's overeoat. m was st«Ud here tod«y, haps Members of Concresi will five mort eonsUtorfttl the rarmer-Labor ptatfomw protrtin* ind prliwlplef should Uke to see the Praclef Mil MMOtod into kiw for tli4 ftl4 of the f Anners; Mf SLAMCHAKO, Will tho fenilOOMfl fUMI MrLUNDIfN, Ye«, Mr, BLAMCMAIU), r>ee« ih$ fftntlOfiMfl fffl ttlAt the presifit fftmi'loAn progrwm Is Ainplo to t«lM Mft of tho tltuAttonf Mr. LVtnymm. l Ui^r U u rather inadoauote. I thiitk it ihould bo eonstderatolir improved, and the ItMlOf bill wpuld bo 1 groftl improvewnt. gUTKOn COUST OECISIOIf Now, referring again to this great decision that I spoke of in the beginning of my remarks, I call the Members' atten- tion to the fact it will be in the Record tomorrow morning. It may be of most vital importance to all the legislation enacted not only in the special session but in the session that is now upon us. I want the gentlemen of this House to give a little consideration to the Farmer-Labor Party. We have not very many Members here on the floor. There are only five Farmer-Labor Members here, but we would like to have you read over our platform and program and give it a little consideration. Perhaps you will not agree with very much of it, but you may see some good in it, and in these evil days that have befallen oxir beloved country we need all the help and all the ideas that can come from all parties, in order that we may solve the situation that is before us. I feel entirely innocent of the great financial catastrophe that has come upon this country. I was here many years ago before any such catastrophe had occurred. I do not want to speak of that at this time. Now we have these various measures proposed — we have this Supreme Court decision. We should read them and study them and par- ticularly give some attention to the petitions to discharge committees that are on the Speaker's desk. I should also like to see a little more leniency about learning the names of the Members who signed the petitions. The rules should enable us to know who they all are. Mr. DUNN. Will the gentleman state when that petition on the Frazier bill was placed at the desk? Mr. LUNDEEN. That was placed there in the last session, the special session. Mr. DUNN. I did not know about it, Mr. 8EOER. Will the gentleman yield? Mr. LUNDEEN. I yield. Mr. SEOER. The gentleman has alluded to the veterans and the dependents. Does he think it is fair to cut the widows of Spanish War veterans to tl5 and give the widows of forest workers $40? Mr. LUNDEEN. I do not think it Is fair, I should like to have every Member of the House read the able speech of the gentleman from Alabama [Mr. HuddlestonI about his Spanish War comrades, when he said, " They are throwing them overboard, and I might as well go overboard with them." It was a wonderful speech, and I wish they woiild give more attention to it. We have In America some 5,000.000 veterans, and I should like to see more consideration given to them. If I had the power, I would repeal every bit of the Economy Act put on the statute books last session and reinstate the veterans and Federal employees where they were before it was enacted. Mr. JOHNSON of Minnesota. While the gentleman Is speaking about the platform of the Farmer-Labor he might state that we have been fighting for the bank-guarantee law that has just been put over here now in Congress for 17 years. Mr. LUNDEEN. I thank the gentleman, my colleague from Minnesota. Mr, JOHNSON of Minnesota. And he might also say that for 15 years we have advocated reforestation in the West, Mr, LUNDEEN, That Is also true. And I want to call attention to the fact that before we adjourned the special session I opposed adjournment of the Congress until we could enact a real, a sound bank guaranty law and other necessary and vital legislation; and I was happy to see the g»ntleman from Alabama (Mr BrtM/^ii), chattman of tho Bankini and Currmrf Committee, eome down the central aisle here swiniina both t)Hn in his battle Inr tho Hnk iuarant4M> deposit law, The bill was passed^ and 1 hope H Will do a ifreat d^^al at mtoA. The IHiprem« Cmirt of ihit Uftif4)4 iHates handed down ft notable deciNi^n on Mmn«««iia'« «merven«y mortfaie mora* torium law, Chief Ju*ti«o Kugh«tt writing the opinion, in whi<;h it was held that govornment possesses the power in emergencies to iegislate for tiis public good. The de- cision referred to upheld the validity of the Minnesota mort- 366 congression.il record— house January 10 1934 CONGRESSIONAL RECORD— HOUSE gage moratorium law against the okijections that it violated the due process with contract and equality clatises of the Constitution of the United States. This decision is a victory for the farm and home owners in the State of Minnesota. The Minnesota mortgage mora- torium law was enacted in answer to a State-wide demand by farm and home owners that they be protected against wholesale foreclosures of mortgages upon farms and homes during this economic depression, which is the most severe and catastrophic in the history of the human race. By reason of the mortgage foreclosures and tax sales, thousands of farm and home owners of the State of Minne- sota were losing their homes. At the beginning of the year 1933. when the Minnesota State Legislature was in session, it was estimated that at least 50.000 farms and homes would be lost to their owners during the year 1933 unless the gov- ernment of the State of Minnesota afforded the people some relief. The result was the Minnesota mortgage moratorium law, which embodies the ideas of Harry H. Peterson, the first Parmer -Labor attorney general in America. The bill was | introduced into the Legislature or Minnesota by a group of Farmer-Labor legislators. It was modified and amended in j many respects in the legislature, flnsdly passed, and speedily signed by Gov. Floyd B. Olson, of Minnesota. The idea imderlying this bill was to protect the farm owners and the home owners of the State of Minnesota so that they would not be ousted from their farms and homes and cast upon the highways and byways of that State and become a handi- cap and public charge. It was a conflict between the prop- erty rights and the mortgage holders and the human rights of the farm and the home owners and their dependents. If these mortgages had been foreclosed, the mortagees would have become the owners of these farms and homes, but it would not have satisfied their mortgages. If the farm and the home owners had been ousted irom their farms and homes and each had an average of from four to five depend- ents, approximately 250.000 of the people of the State of Minnesota would have been rendered homeless and shelter- less and in the most dire need, want, and suffering im- aginable. The decision just rendered sustains this law which enables the farm owners and the home owners upon application to the courts of Minnesota to obtain a moratorium on their mortgages to and through May 1. 1935. In the meantime it is hoped that cheap money will be made available through the Federal land banks and the Home Owners* Loan Corpo- ration and through further legislation, like the Frazier bill, so that the mortgages upon the farms and homes may be refinanced at low cost and at a low rate of interest, and the farms and homes of these people thus saved for them per- manently. It Is believed that the moratorium which these people obtain under this law will enable them to take advan- tage of the law mentioned and refinance their obligations and thus save their farms and homes. It will be seen that this law has conferred an incalculable benefit upon the people of the State of Minnesota. The decision rendered by Chief Justice Hughes demon- strates that the powers of government are expansive and adapUble to the needs of the Nation, and that the Qmem- ment has the power to take appropriate action in any emer- gency that may confront us. This decision is a landmark In the jurisprudence of the history of the United States and marks the triumph of public welfare in the human race over contraot and property rights, It Is an otttotandina achievement of the rarmer^Ubor Purif ot Minnaaota which fought for this law and secured its enaattnent/ It is a U>9,tA aflhi«y»-m«f»t for tha farmer- hnJbttf attorney a^metal of MinneMfHa, iUttv M; feterson, who stigfested the prwjent law and wlw defandad it m the ooufta, Hi was the rtrst attorney aaneral in tlia Unitad •tates to appiftr in an a<^tion involvin« tha validity of a morttaffa moratorium law, aiihouah many such action* have been l>roufht in other States prior to the commencement of the action which was brought to test tha validity of the Minnesota mortgage moratorium law. It has often been said that goTermncnt should aerve the people. This is a case irtiere gofTcmment has and la actu- ally serving the people by proCectiog the farms and the homes which are the foundation of the great State of Minnesota. In this panic through which we are passinf , commonly called a depression, a thousand and one remedies are of- fered by numerous officials and legislators. Among all these remedies none are more important than those which seek to save the farms and the homes of America. Nothing Is more important than the fireside and homestead where the American family is reared. Destruction of the home may imperil the foundations of a nation Itself. The loss of the home by foreclosure is destructive of morale: it is demoralizing. When thousands of mortgagees are permitted to put their property rights and contract rights above human rights — the right to live, the right to have a roof over your head — an emergency exists which must be met \u legislation, and which must l>e passed upon by the courts of this land. On November 8. 1933, it was my pleasure to take my place beside the attorney general of the great State of Minnesota, Harry H. Peterson, when he and Mr. Ervin. of his staff, ably argued for the people of Minnesota in the Supreme Court of the United States — ^human rights as against the mortgage, contract, and property rights. It was well known that this argument was historic and that the decision would be his- toric, and that its effect would be great upon future legisla- tion and the conduct of the Government. The atUnmey gen- eral and his associate made a strong argmnent and showed a complete grasp of the situation. Chief Justice Hughes, speaking for the majority of the Supreme Court of the United States, showed a profound understanding of the situ- ation in this great and overwhelming emergency. This is a culmination of years of effort and flghting for debtor moratorium laws on the part of the great Farmer- Labor Party of Minnesota, lead by our dlsthiguished and able Governor, Floyd B. Olson, who has repeatedly recom- mended such laws, and who signed the l»iU which became a law and which was under scrutiny by the Supreme Court in this case. Our Farmer -Labor legislators in our State legislatures, our Congressmen in the United States Congress, and our numer- ous speakers in many campaigns have fought out this issue with the enemy on the stump. This battle had to be won in many campaigns before the law appeared upon our statute loooks and before this law had an opportunity to be passed on by the Supreme Court of America. When President Hoover issued a moratorium to Europe I frequently stated that the moratorium idea would come home to roost in America, against those who are holding overwhelming obligations against the mass of the people — an indebtedness so overwhelming that it is frequently re- ferred to in round numbers as about $250,000,000,000 total- public and private indebtedness. Our Minnesota Farmer-Labor leaders early determined that the farm and the home must be saved. I have fre- quently stated that if Uncle Sam can give moratoriums to the kings and emperors and nations of Europe we can give moratorituns to the American people. America first I If Uncle Sam can finance Europe to the extent of 1 10,000.- 000,000 and more— an amount with Interest charges running close to twenty-flve billion*— If we can moratorium, refi- nance, and cancel in whole or in part this debt in favor of Europe, we can do as much for our own people here, under our own flag, and in our own land. . ^^ . The Mirmer-Ubor f'arty aohnowladfaa a tfr#at datot io tha fii,tnm»' HUiMii^f Assoaiatlon. and tha farmaff t^nton. and mhtiv other lai^or and aooparativa wnt^tiSmism^m- fim» Hi tha if «at imttla liaiwaaft property rlffhta and human HfhU, Tha Mftta for noaial juailaa muit go on until aom- plata victory erowna tha baniifrs of • ffMi National Vnrm^r* Ubar Farty. iApplauia.l Tha aomplata MtnnesoU mortgage moratoflum law and tha teat and footnotaa of tha Unitad ftataa fuprame Court decision foUow: 1934 CONGRESSIONAL RECORD— HOUSE 367 366 CONGRESSIONAL RECORD— HOUSE >3I -H^. NO. 1«M An act relAtlng to the granting of relief In eertoln eaaes dUTin< the emergency declared to exist, from Inequitable forecloeius of mortgages on real estate and execution sales of real estate and for postponing certain sales and for extending the perloc s of redemption from certain others; and relating to the Jurlsdlt :tlon and procedure for such relief and for the right to possession during the extended period, and for limiting the right to d laln- taln actions for deficiency judgments, and for extending the expiration of certain periods of redemption to 30 days afte] the passage of this act Whereas the severe financial and economic depression exliting for several years past has resulted in extremely low prices foi the products of the farms and the factories, a great amount of ui lem- ployment. an almost complete lack of credit for farmers, bus ness men, and property owners, and a general and extreme stagnation of business, agriculture, and Industry; and Whereas many owners of real property, by reason of said con- ditions, are unable and. It is believed, will for some time be va able to meet all payments as they come due of taxes. Interest, and | )rln- clpal of mortgages on their properties, and are, therefore, threat- ened with loss of such prop>erties through mortgage f orech isxire and Judicial sales thereof; and Whereas many such properties have been and are being bid n at mortgage foreclosure and execution sales for prices much below what is believed to be their real values, and often for much| less than the mortgage or Judgment Indebtedness, thus entailing kiefl- clency Judgments against the mortgage and Judgment debtors; and Whereas It is believed, and the Legislature of Minnesota h«reby declares its belief, that the conditions existing as hereinbef on s set forth has created an emergency of such nature that Justifies and validates legislation for the extension of the time of redem]itlon from mortgage foreclosure and execution sales and other rell it of a like character; and Whereas the State of Minnesota possesses the right, under Its police power, to declare a state of emergency to exist; and Whereas the Inherent and fundamental purpose of our Ooi em- ment is to safeguard the public and promote the general we If are of the people; and Whereas under existing conditions the foreclosure of iiiany real-estate mortgages by advertisement would prevent fair. open. and competitive bidding at the time of sale In the manner now contemplated by law; and Whereas It Is believed, and the Legislature of Mlrmesota liere- by declares Its belief, that the conditions existing eis he-ein- before set forth have created an emergency of such a ni tiu-e that justifies and validates changes in legislation providing for the temporary manner, method, terms, and conditions upon v hlch mortgage foreclosure sales may be had or postponed and Jurlidic- tion to administer equitable relief in connection therewith may be conferred upon the district court; and Whereas Mason's Minnesota Statutes of 1927, section )608, which provides for the postponement of mortgage foreclosure sales, has remained for more than 30 years, a provision ot the statutes in contemplation of which provisions for f orecl< isxire by advertisement have been agreed upon: Now, therefore Be it macted by the Lcg^islature of the State of liinnssota. The provisions of this act shall not apply to any mortgage while such mortgage is held by the United States or by any agency, de >art- ment. bureau, board, or commission thereof, as security or p edge of the maker, its successoni or assigns, nor shall the provlsio: is of this act apply to any mortgage held as seciuity or pledge to w cure payment of a public debt or to secure payment of the deposit of public funds. The following sections of this act preceding part 2 shall consti- tute part 1. Section 1. Emergency declared to exist: In view of the situation hereinbefore set forth, the Legislature of the State of Mlnmtsota hereby declares that a public economic emergency does exliit in the State of Minnesota. Sxc. 2. Mortgagee may apply to district court for relief: In any proceedings heretofore commenced for the foreclosure of a mort- gage on real estate by advertisement, in which a sale of the jirop- erty has not been had, or in any such proceedings hereafter ;om- menced, when the mortgagror, or the owner in possession ol the mortgaged premises, or tmyone claiming under said mortgage r, or anyone liable for the mortgitge debt, at any time after the Issuance of the notice of such foreclosure proceedings, shall apply tc the district court of the county wherein such foreclosure proceei lings are being had. or are pending, by filing and serving a sxuni aons and verified complaint with prayer that the sale In forecloouie by advertisement shall be postponed and that the foreclosure. If any. shall proceed by action. If It appears to the court that graittlnig of the relief as prayed would be equitable and just. then, axd In that event, the foreclosiue proceedings by advertisement ma^r be postponed by the court by an ex parte order which shall be served with the summons and complaint upon the party foreclosin ;, or his attorney, and at the time of the hearing upon such ordei the court may then further postpone such sale, and the parties i eek- ing to foreclose such mortgage shall proceed. If at all. to fore :108e said mortgags by Interposing a cross complaint In such action. Such service may be made as now provided for the service of a summons In a civil action, or by registered maU on the puch application: Provided further, however. That if such mortgagor or Judgment debtor, or personal representative, shall default in the payments, or any of them, in such order required, on his part to be done, or commits waste, his right to redeem from said sale shall terminate 30 days after such default, and holders of subse- quent liens may redeem in the order and manner now provided by law, beginning 30 days after the filing of notice of such default with the clerk of such district court, and his right to posseasion shall cease and the party acquiring title to any such real estate shall then be entitled to the immediate possession of said premises. If default Is claimed by allowance of waste, such 30-day period shall not begin to run until the filing of an order of the court finding such waste: Provided further. That the time of redemption from any real-estate mortgage foreclosiire or Judgment or execu- tion sale heretofore made, which otherwise would expire less than 30 days after the passage and approval of this act, shall be. and the same hereby is. extended to a date 30 days after the passage 1934 CONGRESSIONAL RECORD— HOUSE 367 and approval of this act. and In such case the mortgagor, or judg- ment debtor, or the assigns or personal representative of either, as the case may be. or the owner in the poesesslon of the property. may. prior to said date, apply to said court for and the court may thereupon grant the relief as hereinbefore and In this section pro- vided: Provided further, That prior to May 1. 1935, no action shall be maintained In this State for a deficiency Judgment until the period of redemption as allowed by existing law, or as extended under the provisions of this act, has expired. Sbc. 5. Ctourt may revise and alter terms: Upon the application of either party prior to the expiration of the extended period of redemption as provided In this act and upon the presentation of evidence that the tenns fixed by the court ai-e no longer just and reasonable, the court may revise and alter said terms. In such manner as the changed circumstances and conditions may require. Sec. 6. Trial to be held within 30 days: The trial of any action, hearing, or proceeding mentioned In this act shall be held within 30 days after the liUng by either party of notice of hearing or trial, as the case may be. and such hearing cr trial may be held at any general or special term, or In chambers, or during vaca- tion of the court, and the order of the court shall be filed within 5 days after trial or hearing, no more than 5 days' stay shall be granted, and review by the supreme court may be had by certiorari If application for the writ shall be made within 15 days after notice of such order, and such writ shall be returnable within 30 days after the filing of such order. Six;. 7. Inconsistent laws suspended until May 1, 1935: Every law and all the provisions thereof now In force Insofar as incon- sistent with the provisions of this act, are hereby suspended until May 1. 1935. No extension of the period for redemption nor any po8tp>onenicnt of sale shall be ordered or allowed under this act which would have the effect of extending the period for redemption beyond May 1, 1935. Sec. 8. Application of act: This act as to mortgage foreclosures shall apply only to mortgages made prior to the passage and approval of this act but shall not apply to mortgages made prior to the passage of this act which shall hereafter be renewed or extended for a period ending more than 1 year after the passage of this act; neither shall this act apply In any way which would allow a resale, stay, postponement, or extension to such time that any right might be adversely affected by a statute of limitation. Sec. 9. Provisions severable: The provisions of this act are hereby declared to be severable. If one provision hereof shall be found by the decision of a court of competent Jurisdiction to be invalid, such decision shall not affect the validity of the other provisions of this act. Sec. 10. Definition : The words " mortgagor '*. " mortgagee ". " Judgment creditor ", " Judgment debtor '•. and *• purchaser ", whenever tised in this act shall be construed to Include the plural as well as the singular and also to include their personal repre- sentatives, successors, and assigns. Sec. 11. Application: Whenever the term "this act" is referred to In that part of the bill amended so as to constitute part 1 thereof, the same shall be construed as having reference only to part 1 of this act. PART 2 Section 1. To apply to homesteads only: The following, part 2. of this act shall apply only to real estate occupied as a home exclusively by the person seeking relief or persons dependent uF>on him and to farm lands tised by the person seeking relief as his principal means of furnishing necessary support to such person, his family and dependents, and shall apply only to cases not entitled to relief under some valid provision of part 1 of this act. Sec. 2. Mortgagee may apply to district coxirt for relief: In any proceedings heretofore commenced for the foreclosure of a mortgage on real estate by advertisement. In which a sale of the property has not been had, or in any such proceedings hereafter commenced, when the mortgagor, or the owner in possession of the mortgaged premises, or anyone claiming under said mortgagor, or anyone liable for the mortgage debt, at any time after the Issuance of "the notice of such foreclosure proceedings, shall apply to the district court of the county wherein such foreclosure proceedings are being had. or are pending, by filing and serving a summons and verified complaint with prayer that the sale In foreclosure by advertisement shall be postponed and that the foredostire. if any. shall proceed by action. If It appears to the court that granting of the relief as prayed would be equitable and just, then, and in that event, the foreclosure proceedings by advertisement may be postponed by the court by an ex parte order which shall be served with the summons and complaint upon the party fore- closing or his attorney and at the time of the hearing upon such order, the court may then further postpone such sale, and the parties seeking to foreclose such mortgage shall proceed, If at all. to foreclose said mortgage by Interposing a cross-complaint in such action. Such service may be made as now provided for the service of a summons in a civil action, or by registered mail on the person foreclosing or his authorized agent or attorney at the last known address of such person, agent, or attorney, respectively. As a con- dition precedent to such postponement of such foreclocure sale by advertisement the party filing such verified complaint shall pay to the clerk for the person foreclosing the mortgage the ex- penses Incurred, not including attorney's fees, which may accrue prior to any postponement. The filing of such verified com- plaint shall be deemed a waiver of publication of notice of post- ponement of the foreclosure sale and the wle at the time which may be fixed by the court shall be deemed to be a sale postponed In lieu of the time of sale specified In the published notice of mortgage foreclosure sale. Sec. 3. Jurisdiction of court: The court ahall have the same jurisdiction to postpone the enforcement of Judgment by execu- tion sale or to order resale or give other relief where such Judge- ment U rendered in an action to collect a debt or obligation secured by a real -estate mortgage, the foreclosure of which might be affected under the terms of this act, as Is conferred by this act with regard to the mortgage. Sec. 4. Application of act: The'proTtelons herebeme Cottbt or thb Unttcd Statcs No. 370. — October term. 1933 ROME BimDING & LOAK ASSOCIATION, APPDXANT, V. JOHN H. BLAIS- delx and bosella blaisdell, his wife, appeai. raoM the supums COUBT OF THE STATE OF MINNESOTA (Jan. 8, 19341 Mr. Chief Justice Hughes delivered the opinion of the court. Appellant contests the validity of chapter 339 of the Laws of Minnesota of 1933. page 514, approved April 18, 1933, called the "Minnesota Mortgage Moratorium Law", as being repugnant to the contract clause (art. I, sec. 10) and the due process and equal protection clauses of the fourteenth amendment of the Federal Constitution. The statute was siistalned by the Supreme Court of Minnesote (249 N.W. 334, 893) and the case comes here on appeal. The act provides that, during the emergency declared to exist, relief may be had through authorized judicial proceedings with respect to foreclosures of mortgages, and execution sales of real estate: that sales may be postponed and periods of redemption may be extended. The act does not apply to mortgages subse- quently made nor to those made previously which shall be ex- tended for a period ending more than a year after the passage of the act (pt. 1. sec. 8). There are separate provisions in part 2 relating to homesteads, but these are to apply " only to cases not entitled to relief under some valid provision of part 1." The act Is to remain In effect " only during the continuance of the emer- gency and in no event beyond May 1, 1935." No extension of the period for redemption and no postponement of sale is to be Slowed which would have the effect of extending the period of redemption beyond that date (pt. 2, sec. 8.) The act declares that the various provisions for relief are sever- able- that each Is to stand on ito own fooUng with respect to validity (pt 1, sec. 9.) We are here concerned with the pro- visions of part 1. section 4, authorizing the dUtrlct court of the county to extend the period of redemption from foreclosure sales " for such additional time as the court may deem Just and equi- table " subject to the above -described llmlUtlon. The extension Is to be made upon appUcatlon to the court, on notice, for an order determining the reasonable value of the Income on the property involved In the sale, or if It has no Income, then the reasonable rental value of the property, and directing the mort- easor " to pay all or a reasonable part of such income or rental value In or toward the payment of taxes, insurance, interest. 368 CONGRESSIONAL RECORD— HOUSE s, January 10 mortgat^e • • • indebtedness at such times and In ruch manner " a« Shan be detennlned bv the court ' The section also provides that the time for redemption from foreclosure sales theretofore made, which other-sflse would expire l«ss than 30 days after the approval of the act shall be extended to a date 30 days after Its approval, and aopUcation may be made to the court within that time for a further extension as provided In the section. By another provl- ilon of the act, no action, prior to May 1. 1935. may be maintained for a deficiency Judgment until the period of redemption as allowed by existing law or as extended under the provisions of the act has expired. Prtor to the expiration of the extended period of redemption the court may revise or alter the terms of the extension as changed clrcumfitances may require (pt. 1, sec. 5). Invoking the relevant provision of the statute, appellees applied to th*" district court of Hennepin County for an order extending the period of redemption from a foreclosure sale. Their petition stated that they owned a lot in Minneapolis which they had mort- gaged to appellant: that the mortgage contained a valid power of sale by advertisement and that by reason of their default the mortgage had been foreclosed and sold to appellant on May 2. 1933. for W.700 98; that appellant was the holder of the sheriffs certin- catc of sale; that because of the economic depression appellees had been unable to obtain a new loan or to redeem, and that unless the period of redemption were extended the property would be Irretrievably lost; and that the reasonable value of the property greatly exceeded the amount due on the mortgage including all liens, costs and expenses. On the hearing, appellant objected to the Introduction of evi- dence upon the ground that the statute was Invalid under the Federal and State Constitutions, and moved that the petition be dismissed. The motion was granted, and a motion for a new trial was denied On appeal, the supreme court of the State reversed the decision of the district court (249 N W. 334). Evidence wr\s then taken In the trial court, and appellant renewed its constitu- tional objections without avail. The court made findings of fact setting forth the mortgage made by the appellees on Aug\ist 1, 'That section Is aa follows: " Sec. 4. Period of redemption may be extended. — Where any mortgage upon real property has been foreclosed and the period of redemption has not yet expired, or where a sale Is hereafter had. In the case of real-estate mortgage foreclosure proceedings, now pending, or which may hereafter be Instituted prior to the expira- tion of 2 years from and after the passage of this act. or upon the sale of any real property under any Judgment or execution where the period of redemption has not yet expired, or where such sale is made hereafter within 3 years from and after the passage of this act. the period of redemption may be extended for such addi- tional time as the court may deem Just and equitable, but In no event beyond May 1. 1935; provided that the mortgagor, or the owner in possession of said property, in the case of mortgage fore- closure proceedings, or the Judgment debtor, in case of sale under Judgment or execution, shall prior to the expiration of the period of redemption, apply to the district court having Jurisdiction of the matter, on not less than 10 days' written notice to the mort- gagee or Judgment creditor, or the attorney of either, aa the case may be. for an order determining the reasonable value of the Income on said property, or, it the property has no Income, then the reasonable rental value of the property Involved In such sale, and directing and requiring such mortgagor or Judgment debtor to pay all or a reasonable part of such Income or rental value, in or toward the payment of taxes, insurance. Interest, mortgage or Judgment indebtedness at such times and in such manner as shall be fixed and determined and ordered by the court; and the court shall thereupon hear said application and after such hearing shall make and file its order directing the payment by such mortgagor, or Judgment debtor, of such an amount at such times and in such manner as to the court shall, \inder all the circumstances, appear Just and equitable. Provided that upon the service of the notice or demand aforesaid that the runnmg of the period of redemption shall be tolled until the court shall maie Its order upon such application. Provided further, however, that if such mortgagor cr juc's^mert debtor or personal representative, shall default In the payments, or any of them. In such order required, on his part to be done, or commits waste, his right to redeem from said sale shall terminate 30 days after such default and holders of subse- quent liens may redeem In the order and manner now provided by law besinning 30 days after the filing of notice of such default with the clerk of such district court, and his right to poesesslon shall cease and the party acquiring title to any such real estate shall then be entitled to the immediate possession of said premises. If default is claimed by allowance of waste, such 30-day period shall not begin to run until the filing of an order of the coiirt finding auch waste. Provided, further, that the time of redemption from any real -estate mortgsige foreclosure or Judgment or execution sale heretofore made, which otherwise would expire less than 30 days after the passage and approval of this act. shall be and the same hereby is extended to a date 30 days after the passage and approval of this act, and in such case the mortgagor, or Judgment debtor, or the atMgnw or personal representative of either, as the case may be. or the owner In the possession of the property, may. prior to said date, apply to said court for and the court may thereupon grant the relief as hereinbefore and In this section provided. Pro- vided, further, that prior to May 1. 1935. no action shall be main- tained in tbls State for a deficiency Judgment until the period of redemption as allowed by existing law or as extended under the provisions of this act has expired." 1934 CONGRESSIONAL RECORD— HOUSE 369 1928. the power of sale contained In the mortgage, the default and foreclosure by advertisement, and the sale to appellant on May 3, 1932, for »3,700 98. The court found that the time to redeem would expire on May 2, 1933, under the laws of the State as they were In effect when the mortgage was made and when it was foreclosed; that the reasonable value of the income on the property, and the reasonable rental value, was $40 a month; that the bid made by appellant on the foreclosure sale, and the purchase price, were the full amount of the mortgage Indebtedness, and that there was no deficiency after the sale; that the reasonable present market value of the premises wa.s SO.OOO: and that the total amount of the pur- chase price, with taxes and Insurance premiums subsequently paid by appellant, but exclusive of interest from the date of sale, was $4,056.39. The court also found that the property was situated in the closely built-up portions of Minneapolis: that it had been improved by a 2-car garage, togfther with a building two stories in heUjht which was divided nno 14 rooms; that the appellees, husband and wife, occupied the premises as their homestead, occu- pying 3 rooms and offering the remaining rooms for rental to others. The court entered its Judgment extending the period of re- demption to May 1, 1935. subject to the condition that the ap- pellees should pay to the appellant $40 a month through the extended period from May 2, 1933. that is. that in each of the months of August. September, and October. 1933. the payments should be $80. in two installments, and thereafter $40 a month, all these amounts to go to the payment of taxes, insurance, Interest. and mortgage indebtedness.' It is this Judgment, sustained by the supreme court of the State on the authority of its former opinion, which is here under review (249 N.W. 893). The State court upheld the statute as an emergency measure. Although conceding that the obligations of the mortgage contract were impaired, the court decided that what it thus described as an impairment was. notwithstanding the contract clause of the Fed- eral Constitution, within the police power of the State as that power was called into exercise by the public economic emergency which the legislature had found to exist. Attention Is thus directed to the preamble and first section of the statute which described the existing emergency in terms that were deemed to Justify the temporary relief which the statute affords.' The State »A Joint statement of the counsel for both parties, filed with the court on the argument in this court, shows that, after pro- viding for tar.es, Insurance, and interest, and crediting the pay- ments to be made by the mortgagor iinder the Judgment, the amount necessary to redeem May 1, 1935. would be $4,253.82. •The preamble and the first section of the act are as follows: " Whereas, the severe financial and economic depression existing for several years past has resulted in extremely low prices for the products of the farms and the factories, a great amount of unem- ployment, an almost complete lack of credit for farmers, business men and property owners and a general and extreme stagnation of business, agriculture and industry, and " Whereas, many owners of real property, by reason of said con- ditions, are unable, and it Is believed, will for some time be unable to meet all payments as they come due of taxes, interest and prin- cipal of mortgages on their properties and are, therefore, threatened with loss of such properties through mortgage foreclosure and Judicial sales thereof, and " Whereas, many such properties have been and are being bid m at mortgage foreclosure and execution sales for prices much below what Is believed to be their real values and often for much less than the mortgage or Judgment Indebtedness, thus entailing defi- ciency Judgment against the mortgage and Judgment debtors, and •' Whereas, it is believed, and the Legislature of Minnesota hereby declares its belief, that the conditions existing as hereinbefore set forth have created an emergency of such nature that Justifies and validates legislation for the extension of the time of redemption from mortgage foreclosxire and execution sales and other relief of a like character; and " Whereas, the State of Minnesota possesses the right under Its police power to declare a state of emergency to exist, and " Whereas, the inherent and fundamental purpose of our Govern- ment is to safeguard the public and promote the general welfare of the people; and " Whereas, under existing conditions the foreclosure of many real estate mortgages by advertisement would prevent fair, open, and competitive bidding at the time of sale in the manner now contem- plated by law, and " Whereas, it is believed, and the Legislature of Minnesota hereby declares its belief, that the conditions existing as hereinbefore set forth have created an emergency of such a nature that Justifies and validates changes in legislation providing for the temporary man- ner, method, terms and conditions upon which mortgage fore- closure sales may be had or postponed and Jurisdiction to admin- ister equitable relief in connection therewith may be coiiferred upon the district court, and " Whereas. Mason's Minnesota SUtutes of 1927. sec. 9608, which provides for the postponement of mortgage foreclosure sales, has remained for more than 30 years, a provision of the statutes in contemplation of which provisions for foreclosure by advertisement have been agreed upon;" • •«•••* "Skction 1. Emergency declared to exist. — In view of the situa- tion hereinbefore set forth, the Legislature of the State of Minne- sota hereby declares that a public economic emergency does exist In ttie State of Minnesota." covirt, declaring that it could not say that this legislative finding was without basis, supplemented that finding by its own statement of conditions of which it took Judicial notice. The court said: " In addition to the weight to be given the determination of the legislature that an economic emergency exists which demands relief, the court must take notice of other considerations. The members of the legislature come from every community of the State and from all the walks of life. They are familiar with condi- tions generally In every calling, occupation, profession, and busi- ness in the State. Not only they, but the courts must be guided by what Is common knowledge. It is common knowledge that in the last few years land values have shrunk enormously. Loans made a few years ago upon the basis of the then going values cannot possibly be replaced on the basis of present values. We all know that when this law was enacted the large financial com- panies, which had made it their business to Invest In mortgages, had ceased to do so. No bank would directly or Indirectly loan on real estate mortgages. Life Insurance companies, large inves- tors in such mortgages, had even declared a moratorium as to the loan provisions of their policy contracts. The President had closed banks temporarily. The Congress. In addition to many extraordi- nary measures looking to the relief of the economic emergency, had passed an act to supply funds whereby mortgagors may be able within a reasonable time to refinance their mortgages or redeem from sales where the redemption has not expired. With this knowledge the court cannot well hold that the leglslat\xre had no basis in fact for the conclusion that an economic emer- gency existed which called for the exercise of the police power to grant relief." Justice Olsen of the State court, in a concvirrlng opinion, added the following: " The present Nation-wide and world-wide business and financial crisis has the same results as if it were caused by flood, earthquake, or disturbance in nature. It has deprived millions of persons in this Nation of their emplo3mient and means of earning a living for themselves and their families; it has destroyed the value of and the income from all property on which thousands of people depended for a living; it actually has resulted In the loss of their homes by a number of our people and threatens to result In the loss of their homes by many other people in this State; it has resulted in such wide-spread want and suffering among our people that private. State end municipal agencies are unable to ade- quately relieve the want and suffering and Congress has found it necessary to step in and attempt to remedy the situation by Federal aid. Millions of the people's money were and are yet tied up In closed banks and in business enterprises." * We approach the questions thus presented up>on the assumption made below, as required by the law of the State, that the mort- gage contained a valid power of sale to be exerci«>ed In case of default; that this power was validly exercised; that tmder the * law then applicable the period of redemption from the sale was 1 year and that it has been extended by the Judgment of the court over the opposition of the mortgagee-purchaser; and that during the period thus extended, and unless the order for ex- tension is modified, the mortgagee-purchaser will be unable to obtain possession, or to obtain or convey title in fee, as he would have been able to do had the statute not been enacted. The statute does not Impair the integrity of the mortgage Indebted- ness. The obligation for Interest remains. The statute does not affect the validity of the sale or the right of a mortgagee- purchaser to title in fee, or his right to obtain a deficiency * The attorney general of the State in his argument before this court made the following statement of general conditions in Min- nesota: "Minnesota is predominantly an agricultural State. A little more than one half of its people live on farms. At the time this law was passed the prices of farm products had fallen to a point where most of the persons engaged in farming could not realize enough from their products to support their families and pav taxes and interest on the mortgages on their homes. In the fall and winter of 1932 In the villages and small cities where most of the farmers must market their produce, corn was quoted as low aa 8 cents per bushel, cats 2 cents and wheat 29 cents per bushel, eggs at 7 cents per dozen and butter at 10 cents per pound. The Industry second in Importance is mining. In normal times Minnesota produces about 60 percent of the iron of the United States and nearly 30 percent of all the iron produced in the world. In 1932 the production of iron fell to less than 15 percent of normal production. The families of idle miners soon became destitute and had to be supported by public funds. Other in- dustries of the State, such as lumbering and the manufacture of wood products, the mantifacture of farm machinery and various goods of steel and iron have also been affected disastrously by the depression. Because of the Increased burden on the State and Its political subdivisions which resulted from the depression, taxes on lands, which provide by far the major portion of the taxes in this State, were Increased to such an extent that In many in- stances they became confiscatory. Tax delinquencies were alarm- ingly great, rising as high as 78 percent In one county of the State. In seven cotmties of the State the tax delinquency was over 50 percent. Because of these delinquencies many towns, school districts, villages and cities were practically bankrupt. In many of these political subdivisions of the State local gov- ernment would have ceased to function and would have collapsed had it not been for loans from the State." The attorney general also stated tbat seriotis breaches of the peace had occurred. Judgment, if the mortgagor falls to redeem within the prescribed period. Aside from the extension of time, the other conditions of redemption are unaltered. While the mortgagor remains In possession he must pay the rental value as that value has been determhied, upon notice and hearing, by the court. The rental value so paid is devoted to the carrying of the property by the application of the required payments to taxes, insurance, and interest on the mortgage Indebtedness. While the mortgagee- purchaser is debarred from actual possession, he has. so far aa rental value is concerned, the equivalent of possession during the extended period. In determining whether the provision for this temporary and conditional relief exceeds the power of the State by reason of the clause in the Federal Constitution prohibiting impairment of the obligations of contracts, we must consider the relation of emer- gency to constitutional power, the historical settiixg of the con- tract clause, the development of the Jurisprudence of this court in the construction of that clause, and the principles of construc- tion which we may consider to be established. Emergency does not create power. Emergency does not increase granted power or remove or diminish the restrictions imposed upon power granted or reserved. The Constitution was adopted In a period of grave emergency. Its grants of power to the Fed- eral Government and its limitations of the power of the States were determined in the light of emergency and they are not altered by emergency. What power was thus granted and what limitations were thus imposed are questions which have always been, and always will be, the subject of close examination under our constitutional system. While emergency does not create power, emergency may furnish the occasion for the exercise of power. "Although an emergency may not call into life a power which has never lived, nevertheless emergency may afford a reason for the exertion of a living power already enjoyed " {Wilson v. New. 243 US. 332. 348). The consti- tutional question presented in the light of an emergency la wncther the power possessed embraces the particular exercise of it In response to particular conditions. Thus, the war power of the Federal Government is not created by the emergency of war. but it is a p>ower given to meet that emergency. It is a power to wage war successfully and thus it permits the harnessing of the entire energies of the people in a supreme cooperative effort to preserve the Nation. But even the war power does not remove constitutional limitations safeguarding essential liberties.' When the provisions of the Constitution, in grant or restriction, are specific, BO particularized aa not to admit of construction, no question is presented. Thus, eme^ency would not permit a State to 'have more than two Senators in the Congress, or permit the election of President by a general popular vote without regard to the number of electors to which the States are reapectlvely entitled or permit the States to " coin money " or to " make any- thing but gold and silver coin a tender in payment of detts." But where constitutional grants and limitations of power are set forth In general clauses, which afford a broad outline, the process of construction is essential to fill In the deUlls. That is true of the contract clause. The necessity of construction is not obviated by the fact that the contract clause is associated in the same section with other and more specific prohibitions. Even the grouping of subjects In the same clavise may not require the same application to each of the subjects, regardless of differences in their nature. (See Groves v. Slaughter, 16 Pet. 449, 605; Atlantio Cleaners Jk Dyers v. United States, 286 \JB. 427, 434.) In the construction of the contract clause, the debates in the Constitutional Convention are of little aid.* But the reasons which led to the adoption of that clause, and of the other prohibi- tions of section 10 of article I. are not left in doubt and have frequently been described with eloquent emphasis.* The wide- spread distress following the revolutionary period and the plight of debtors had called forth in the States an ignoble array of legislative schemes for the defeat of creditors and the Invasion of contractual obligations. Legislative interferences had been so numerous and extreme that the confidence essential to prosperous trade had been undermined and the utter destruction of credit was threatened. " The sober people of America " were convinced that some " thorough reform " was needed which would " inspire a general prudence and industry, and give a regiilar course to the business of society" (The Federalist, no. 44). It was neccssarf to interpose the restraining power of a central authority In order to secure the foundations even of " private faith." The occasion and general purpose of the contract clause are summed up in the terse statment of Chief Justice Marshall in Ogden v. Saunders (12 Wheat., pp. 213, 354. 355) : "The power of changing the reU- »See Ex parte Milligan (4 Wall. 2, 120-127): United States r. Russell (13 Wall. 623, 627): HamUton v. Kentucky Di*tiUenes A Warehouse Co. (251 U.S. 146. 155); United States v. Cohen Orocery Co (255 XJ3. 81, 88). ^^_ •Farrand, Records of the Federal Convention, vol. 2. pp. 439. 440 697 610: Elliot's Debates, vol. 5. pp. 485, 488, 645, 646; Ban- croft History of the U.S. Constitution, vol. 2, pp. 137-139; Warren, The Mn^mg of the Constitution, pp. 652-656, Compara Ordinance for the Government of the Northwest Territory, art. 2. » The Federalist, no. 44 (Madison) : MarshaU. Life of Washington, vol 5 pp 85-90, 112, 113; Bancroft. History of the VS. Constitu- tion vol 1, pp. 228 et seq.: Black, Constitutional Prohibitlona. pp 1-7- Flske, The Critical Period of American History, 8th ed, pp. 168 et seq.; Adams v. Storey (1 Palne's Rep.. 79. 90-92). Lxxvm- -24 r^rkXTn-D-COamXT A T PT?mPn WOTTSF. January 10 1934 CONGRESSIONAL RECORD— HOUSE 871 370 CONGRESSIONAL Uve tltuatlon of debtor and creditor, of InterfertBf ^^.^^^ a power which come, home to every m«i. touche. the totereat of alLand control, the conduct of every Individual In tho«. thUifi which he .uppo^ to be proper for his own "clu^ management. SS b**n uiS^euch in exce- by "^^ SUte legtelature. a- to break In upon the ordinary Intercourw of ■fclety and ^^^T »" confidence between man and man. The mUchlef »»«» b«ome « m-eat -o alarming, as not only to Impair commercial Interrouree intf threaten the existence of credit, but to eap the moraU oj the people, and d<*stroy the sanctity of private faith. To part airalnst the continuance of the evil was an object at deep interest iirtth all the truly wise. a« weU aa the vlrtuovia. of thU great com-* munlty. and was one of the Important beneftU expected from i reform of the Oovernment." But full recognition of the occasion and general purpoee of tb< clause does not suffice to fix Its precise scope. Nor does an examl nation of the detaUs of prior legislation In the States yield crlterli which can be considered controlling. To ascertain the acope o the constitutional prohibition we examine the course of Judlcla decisions In Its application. These put It beyond question ^av the prohibition is not an absolute one and Is not to be read wltu Uteral exactness like a mathematical formula. Justice Johnson, in OgtUn v. Saunder$. rupra (p. 286). adverted to such a mis directed effort In these words: "It appears to me, that a gi*«' part of the dllBc\ilties of the cause, arise from not giving sufB- dent weight to the general Intent of this clause In the Const! tutlon. and subjecting It to a severe literal construction, whlcl i would be better adapted to special pleadings." And after glvln 5 his view as to the purport of the clause — " that the States sha] i pass no law, attaching to the acts of Individuals other effects 0 r consequences than thoee attached to them by the laws existins at their date; and all contracts thxjs construed, shall be enforce I according to their Just and reasonable purport " — Justice Johnso 1 added : " But to assign to contracts, universally, a literal p\irpor 1, and to exact for them a rigid literal fulflllment. could not havs been the Intent of the ConsUtution. It is repelled by a hundrel examples. Socletlee exercise a positive control as well over ♦^^ Inception, construction, and fulfillment of contracts, as over Xorm and measxire of the remedy to enforce them." The Inescapable problems of construction have been: What la ^-.jontract? • What are the obligations of contracts? What oonsti - tutas impairment of these obllgaUons? What residuum of poweratlon of coe- tracts. to protect the vital Interests of the commimlty? Questloi s of this character. " of no small nicety and intricacy, have vexe^ the legislative halls, as well as the Judicial tribunals, with a uiK:ounted variety and frequency of litigation and qjMCUlatlon (Story on the Constitution, sec. 1375). , The obligation of a contract la " the law which binds the partk ■ to perform their agreement." (Sturges v. Crowninahield. 4 Whea^ 12a. 197: Story, op. cit., sec. 1378.) This court has said that " t" law* which subsist at the time and place of the making of contract, and where it is to be performed, enter Into and form part of It. as if they were expressly referred to or Incorpwrated Its terms. This principle embraces alike thoee which •♦» Its validity, construction, discharge and enforcement. • Nothing can be more material to the obligation than the meais of enforcement. • • • The ideas of validity and remedy air Iziaeparable. and both are parts of the obligation, which Is guai anteed by the Constitution against invasion." {Von Hoffman 1 City 0/ Quincy. 4 Wall. 536. 560. 553. See, also. Walker v. WhiU head. 16 Wall. 314. 317.) But this broad language cannot be t-'"^ without qualification. Chief Justice Marshall pointed out distinction between obligation and remedy (Sturges v. CTounii\ ahteld. tupra. p. 300). Said he: " The distinction between the r*- ligation of a contract, and the remedy given by the legislatvure •nforce that obllgaUon. has been taken at the bar, and exists the nature of things. Without Impairing the obligation of contract, the remedy may certainly be modified as the wisdom the Nation ahall direct." And m Von Hoffman v. City of Quinc i •upra (pp. 663. 664), the general statement above quoted waa ^^'^ Ited by the fxirther observation that "It is competent for States to change the form of the remedy, or to modify it othe* wtae, aa they may see fit, provided no substantial right secured "^ the contract is thereby impaired. No attempt has been made fix definitely the line between alterations of the remedy, wh are to be dtm«l legitimate, and those which, under the form modifying the remedy, impair subsuntial rights. Bvcry caae m tM determined upon its own circumstances." And Chief JuaUte Waite. quoting this language in Antonl v. Oraenhow (107 T3S. H 9 775) added: "In all such eases the question become*, theref 01 e one of rcasonablenees. and of that the legislature le prlmarUy **'' judge." an tHe a ft la allef muit ■tl« 7(B roie. tlte • Contract*, within the meaning of the eUuee. h«y* becoi held lo embrace thoee that are executed, that Is, granta, aa well •• thcie that are executory {fUtcKer v. Peek. 9 Craneh. 91. IMl; Ttrrett ▼, reylor, 0 Craoeh. 43) . They embrace the charter* of prtTato 00- ratlon* [Dartmouth College v. Woodward. 4 Wheat. 61t). But the marriage contract, ao aa to limit the general rlfht to legf on the subject of divorce (Id., p. 9M: Maynard ▼. Hill, 136 190. 310). Nor are Judgment*, though rendered upon oontrace, deemed to be within the provtaion {Morlev v. Lake Shore F ' vay Co.. 146 UB. 162. 169). Nor does a general law, giving consent of a SUU to be sued. oonatituU a oootract {Beert Arkatuat, 30 Bow. 637). oorps" nrt leglsUte - U». "ac J Jt* I tie RECORD— HOUSE January 10 The obligation* of a contract are impaired by a low which renders them invalid, or releases or extinguishes them • {Sturges r. CrovHnthield. tupra. pp. 197. 198) and Impairment, as above not^/h** b^n medicated of law* which without destroying con- tracts derogate from substantial contractual rights. " In Sturgea v. Cro%oninahield. supra, a State insolvent law. which d^charged the debtor from hablllty was held to be Invalid as apr'-lcd to con- tract* in existence when the law was passed. (See Ogdeny. Saun- ders, »iipro.) In Green v. Biddle (8 Wheat. 1) the legislative acta, which were successfully assailed, exempted the occupant of land from the payment of rents and proflU to the rightful owner and were " parts of a system the object of which was to conripel the rightful owner to relinquish his lands or pay for all lasting improvements made upon them, without his consent or default. In BroTwon v. Kimie (1 How. 311), State legislation, which hsid been enacted for the relief of debtors In view of the seriously depressed condition of business." following the panic of 1837 and which provided that the equitable estate of the mortgagor should not be extinguished for 12 months after sale on foreclosure, and further prevented any sale unless two thirds of the appraised value of the property should be bid therefor, was held to violate the consUtutlonal provision. It will be observed that in the Bronson case, aside from the requirement as to the amount o. the bid at the sale, the extension of the period of redemption was xmcondiUonal, and there was no provision, as in the Instant case, to secure to the mortgagee the rental value of the prop- erty diulng the extended period. McCracken v. Hayicard (2 How. 608) . Gantiy a Lessee v. EuHng (3 How. 707), and Howard v. Bugbee (24 How 461) followed the decision in Bronson v Ktnzie, that of McCracken. condemning a statute which provided that an execution sale should not be made of property unless It would bring two thirds of its value according to the opinion of three householders; that of Gantly's lessee, condemning a statute which required a sale for not less than one half the appraised value; and that of Howard, making a similar ruling as to an unconditional extension of 2 years for redemption from foreclosure sale. In Planters' Bank v. Shorp (6 How. 301) a State law was found to bo Invalid which prevented a bank from transferring notes and bill* receivable which it had been duly authorized to acquire. In Von Hoffman v. City of Quincy. supra, a statute which restricted the power of taxation which had previously been given to provide for the payment of municipal bonds waa set aside. LouixuiTia v. Police Jury an U.S. 716) and Seibert v. Lewis (122 US. 284) are similar cases. In Walker v. Whitehead (16 Wall. 314) the statute, which was held to be repugnant to the contract clause, was enacted In 1870 and provided that In all suits pending on any debt or con- tract made before June 1. 1865, the plaintiff should not have a verdict unless it appeared that all taxes chargeable by law on the same had been diUy paid for each year since the contract was made- and, further, that In aU cases of Indebtedness of the de- scribed class the defendant might offset any losses he had suffered • In consequence of the late war, either from destructi-«n or depre- ciation of property. (See Daniels v. Tearney. 102 U.S 415. 419 ) In Gunn v. Barry (15 Wall. 610) and Edwards v. Kearzey (96 U.S. 505) statutes applicable to prior contracts were condemned because of increases In the amount of the property of Judgment debtors which were exempted from levy and sale on execution. But. In Penniman-s case (103 V3. 714. 720) the com! decided that a statute abolishing Imprisonment for debt did not, within the meaning of the Constitution, impair the obligation of contracts previously made;'* and the court said: "The general doctrine of this court on this subject may be thus stated: In modes of pro- ceeding and forms to enforce the contract the legislature has the control, and may enlarge, limit or alter them, provided It does not deny a remedy or so embarrass It with conditions or restrictions aa seriously to impair the value of the right." In Barnitz v. Beverly (163 US. 118) the court held that a statute which author- ized the redemption of property sold on foreclosure, where no right of redemption previously existed, or which extended the period of redemption beyond the time formerly allowed, could not constitutionally apply to a sale under a mortgage executed before Ita passage. This ruling was to the same effect as that In Bronson ». Kimie. supra, and Howard v. Bugbee. supra. But In the Bamlta case the statute contained a provision for the prevention of waste and authorized the appointment of a receiver of the premises sold. Otherwise the extension of the period for redemption was uncon- •But there Is held to be no Impairment by a law which re- movee the taint of Illegality and thus permits enforcement, a*, •<■• by repeal of a sutute making a contract void for usury lEioell V. Daggi. 108 XJB. 143. 151). **8ee, in addition to cases cited In the text, the following: rarmert h ftechanicn' Bank v, BmMh (0 Wheat. 131): Piqua Bank y, jrnoop (16 How. 369): Dodge v. Woolsey (18 How. 331); Jefferson Branch Bank v. Skelly (1 Black, 430); State Tax on Poreign-held Bonde (18 Wall. 800); Parnngton v, Tennraee (98 VS. 879); Murray v. Charleston (96 U.«. 433); Hartman v. Oreenhow (103 VM. 873); McOahey v. Virginia (135 VA. 662); Drd/nrd v. Eastern Building A Loan Assorlation (181 US 227); Wrigtn v. Ccnfrol of Georgia Railway Co. (230 UJ8. 674); Central of Georgia Railway Co. V. Wright (348 Ui5. 626); Ohio Public Service Co. v Ohio (274 U.8. 13). >• See Warren, the Supreme Court In United SUtes HUtory, vol. 3, pp. 376-379. "See Sturges v. Crowninshleld (4 Wheat. 133, 300. 201): Mason ▼. HaiU (13 Wheat. 370. 378); Beers v. Uaughton (9 Pet. 329, 359). 1934 CONGRESSIONAL RECORD— HOUSE 871 dltlonal, and In ca»e a receirer wa* appointed, the income during the period allowed for redemption, except what was necessary for repairs and to prevent waste, was still to go to the mortgagor. None of these cases, and we have cited those upon which appel- lant chiefly relies, is directly applicable to the question now before us m view of the conditions with which the Minnesota statute seeks to safeguard the Interests of the mortgagee-purchaser during the extended period. And broad expressions contained In some of these opinions went beyond the requirements of the decision and are not controlling (CoheJis v. Virginia. 6 Wheat. 264. 399). Not only Is the constitutional provision qualified by the measure of control which the State retains over remedial processes." but the State also continues to possess authority to safeguard the vital Interests of Its people. It does not matter that legislation appro- priate to that end " has the result of modifying or abrogating con- tracts already In effect " {Stephenson v. Binford. 287 VS. 251, 376). Not only are existing laws read Into contracts in order to fix obligations as between the parties, but the reservation of eseen- tlal attributes of sovereign power is also read into contracts as a postulate of the legal order. The policy of protecting contracts against impairment presupposes the maintenance of a government by virtue of which contractual relations are worth while — a govern- ment which retains adequate authority to sectire the peace and good order of society. This principle of harmonizing the con- stitutional prohibition with the necessary residuum of State power has had progressive recognition in the decisions of this court. While the charters of private corp>orations constitute contracts, a grant of exclusive privilege is not to be implied as against the State {Charles River Bridge v. Warren BHdge, 11 Pet. 420). And all contracts are subject to the right of eminent domain {West River Bridge v. Dix. 6 How. 507) ." The reservation of this necessary authority of the State is deemed to be a part of the contract. In the case last cited, the court answered the forcible challenge of the State's power by the following statement of the controlling principle — a statement reiterated by this court speaking through Mr Justice Brewer, nearly 50 years later. In Long Island Water Supply Co. V. Brooklyn (166 U.S. 685. 692) : " But Into all contracts. Whether made between States and individuals, or between indi- viduals only, there enter conditions which arise not out of the literal terms of the contract Itself; they are superinduced by the preexisting and higher authority of the laws of nature, of nations, or of the community to which the parties belong; they are always presumed, and must be presumed, to be known and recognized by all, are binding upon all, and need never, therefore, be carried into express stipulation, for this could add nothing to their force. Every contract Is made In subordination to them, and mu.st yield to their control, as conditions Inherent and paramount, wherever a necessity for their execution shall occur." The legislature cannot " bargain away the public health or the public morals." Thus, the constitutional provision against the im- pairment of contracts was held not to be violated by an amend- ment of the State constitution which put an end to a lottery theretofore authorized by the legislature. {Stone v. Mississippi. 101 U.S. 814, 819; see also, Douglas v. Kentucky, 168 U.S. 488. 497-499; compare New Orleans v. Houston, 119 U.S. 265. 275.) The lottery was a valid enterprise when established under express State authority, but the legislature in the public Interest could put a stop to it. A similar rule has been applied to the control by the State of the sale of intoxicating liquors. {Beer Company v. Massachusetts. 97 U.S. 25, 32, 33; see Mugler v. Kansas. 123 U.S. 623. 664, 665.) The States retain adequate power to protect the public health against the maintenance of nuisances despite Insist- ence upon existing contracts. {Fertilizing Company v. Hyde Park, 97 U.S. 659, 667; Butchers' Union Company v. Crescent City Com- pany. Ill U.S. 746, 750.) Legislation to protect the public safety comes within the same category of reserved power (Chicago. " Illustrations of changes In remedies which have been sustained may be seen in the following cases: Jackson v. Lamphire (3 Pet. 280); Hawkins v. Barneys Lessee (5 Pet. 457); Crawford v. Branch Bank (7 How. 279): Curtis v. Whitney (13 Wall. 68); Railroad Co. v. Hecht (95 VS. 168); Terry v. Anderson (95 U.S. 628); Tennessee V. Sneed (96 U.S. 69); South Carolina v. Gaillard (101 U.S. 433); Louisiana v. New Orleans (102 UJ3. 203); Connecticut Mutual Life Insurance Co. v. Cushman (108 U.S. 51): Vance v. Vance (108 V3. 614): Gllfillan v. Union Canal Co. (109 U.S. 401); Hill v. Jlfer- ehants' Insurance Co. (134 U.8. 816); New Orleans City A Lake RJi. Co. v. New Orleans (167 U.S. 219); Red River Valley Bank v. Craig (181 UjB. 848); Wilson v. Standefer (184 US, 399); Oshkosh Waterworks Co. v Oshkoth (187 VB. 437): Waggoner v. Flack (188 U.8. 606); Bernheimer v. Converse (306 U.S. 616); Henley v. Myers (318 U.S. 373); Selig V, Hamilton (334 U.S. 863); Security Savings Bank V. California {263 VJB. 292). Compare the following Illustrative cases, where change* In reme* dies were deemed to be of iuch a character a* to Interfere with •utaitantlfti right*: WUmington dk Weldon RR. Co. v, King (91 VM 3); Memphis y. United States (97 US. 293); Virginia Coupon cases (114 UJI. 389, 370. 398, 399); Kfflnger v. Kenney <116 U.S, 688); Fisk v. Jeffarson Police Jury (110 U J. 131); Bradley s. Light- cap (196 U.8. I): Bank of Minden v, Clement (268 U.S, 128), '•See. also, New Orleans Gas Co. v, Louislar\a Light Co. n*6 u.8, 8W, 673); Offleld v. New York. N. H. i, //. «-«£o- <303 IJ.S, 373); Cincinnati v. Louisville A Nashville RR. Co. (323 VS. 300): Penn- sylvania Hospital V. Philadelphia (2ib V.B 20. 2:i). Galveston Wharf Company v. Galveston (360 U.8. 473, 478j; Georgia v. Chattanooga (384 U,8. 473). B. A Q. R.R. Co. ▼. Mabrmtkd. ITD U*. 87, TO. 74; TeSM * M. O, R.R. Co. V. Miller. 331 VS. 406, 414: Attmntie Coast Lint M.M. Co. V. Gk>ld«t>oro, 333 VS. 848. 868) . Thi* prinolpte ha* bad recent and noteworthy application to the regulatton of the us* of puMle highways by common carrier* and " contract carrier* ", where the assertion of Interference with exlstinx contract right* ha* been without avail {Sproles v, Binford. 888 U.8. 874, 890, 891; Stephen- son V. Binford. supra). The economic Interests of the 8Ute may Justify the exerciee of Its continuing and dominant protective power notwithstanding in- terference with contracts. In Manigautt ▼. Spring (189 U.8. 478), riparian owners In South Carolina had made a contract for a clear passage through a creek by the removal of existing ob*tructlon». Later, the leglslatiire of the State, by virtue of It* broad authority to make public improvements, and in order to increaae the tax- able value of the lowlands which would be drained, authorised tha construction of a dam across the creek. The Court euctained the statute upon the ground that the private Intereet* were eubeer- vient to the public right. The Cotirt said (Id., p. 480) : " It U the settled law of this court that the interdiction of statute* impair- ing the obligation of contracts does not prevent the State from exercising such powers as are vested In It for the promotion of tha commonweal, or are necessary for the general good of the publi^ though contracts previously entered into between Individuals may thereby be affected. This power, which in It* various ramifications is known as the police power. Is an exercise of the sovereign right of the Government to protect the lives, health, morals, comfort, and general welfare of the people, and U paramount to any rights under contracts between Individuals." A statute of New Jersey prohibiting the transportation of water of the State into any other State was sustained against the objection that the statute Im- paired the obligation of contracts which had been made for ftu-- nishlng such water to persons without the State {Hudson Water Co. v. McCarter. 209 UJS. 349). Said the Court, by Mr. Justice Holmes (id., p. 357): "One whose rights, such as they are. are subject to State restriction, cannot remove them from the power of the State by making a contract about them. The contract will carry with It the Infirmity of the subject matter." The general authority of the legislature to regxUate, and thus to modify, the rates charged by public -service corporations affords another illiis- tration {Stone v. Farmers Loan A Trust Co.. 116 U.S. 807. 325. 326). In Union Dry Goods Co. v. Georgia Public Service Corporation (248 U.S. 372), a statute fixing reasonable rates, to be charged by a corporation for supplying electricity to the inhabitants of a city, superseded lower rates which had been agreed upon by a contract previously made for a definite term between the company and a consumer. The validity of the statute was sustained. To the same effect are Producers Transportation Co. v. Railroad Com- mission (251 UJS. 228, 232) . and SuUer Butte Canal Co. v. Jtailrood Commission (279 US. 125, 138). Similarly, where the protective power of the State is exercised in a manner otherwise appropriate in the regulation of a business It Is no objection that the per- formance of existing contracU may be frustrated by the prohibi- tion of injurious practices. {Rast v. Van Deman A Lewis Co.. 240 UJS. 342. 363: see. also, St. Louis Poster Advertising Co. v. St. Louis, 249 U.S. 269. 274.) The argument is pressed that In the case* we have cited the obligation of contracts was affected only Incidentally. Thto argu- ment proceeds upon a misconception. The question is not whether the legislative action affects contracts IncidentaUy, or directly or indirectly, but whether the legislation is addressed to a legitimate end and the measxires taken are reasonable and ap- propriate to that end. Another argument, which comes more cloMly to the point, is that the State power may be addressed directly to the prevention of the enforcement of contracts only when these are of a sort which the legUlature in Its discretion may denounce as being In themselves hostile to public morals, or public health, safety or welfare, or where the prohibition is merely of injurious practices; that Interference with the enforceoMnt of other and valid contracts according to appropriate leg^ prooedure. although the interference Is temporary and for a public purpoee. Is not permissible. This is but to contend that In the latter ease the endls not legitimate in the view that It cannot toe reconciled with a fair interpretation of the constitutional provtaion. Undoubtedly, whatever 1* reeerved of SUte Pf»yj« »J»* be con- sistent with the fair intent of the constitutional limiution ofthat power. The reserved power cannot be «»*^** ■?^*|*.*2J2!72 ^e limitation, nor ta the ^i«^*»*^^^JobaMUtx^taJm^^7^ reserved power In lU eesentlal aspects. They must be construed irSarmony with each other, Thta principle pra conditional; that it was sustained because o the smarfcney due to scarcity of housing: azMl that provision was made for rsasonable compensation to the landlord during thi i period ha was prevented from regaining possession. The cour; also decided that while the declaration by the legislature as ttaa existence of the emergency was entitled to great respect, i was not conclusive; and. further, that a law " depending upon th i •slstence of an emergency or other certain state of facts to upboli i 11 may cease to ^>erate if the emergency ceases or the facts chang t •vm thoi^ valid when pasMd." It is always open to Judicial Inquiry whether the exigency still exists upon which the continue I operation of the law depends. {ChatUeton Corporation v. Sinlf' eteir). 264 U3. 543, 547. 548). It la manifest from this review of o\ir decisions that there h been a growing appreciation of public needs and of the neoessit r of nru^tng ground for a rational compromise between Indlvldui I rights fnd public welfare. The settlement and consequent r— ' tractioo of the public domain, the pressure of a constantly creasing density of pc^iulatlon, the interrelation of the activlti of our people and the complexity of our economic interests, havs Inevitably led to an increased use of the organization of society 1 1 order to protect the very bases of individual opportunity. When i. In earlier days, it was thought that only the concerns of indi- viduals or of rlasifn were Involved, and that thoae of the Stat^ Itaelf were touched only remotely. It has later been fotuKl that fundamental interests oi° the State are directly affected; and \ the question is no longer merely that of one party to a contnut as against another, but of the uss of reaaonable means to safe- guard the economic structure upon which the good of all depend l It u no answer to say that thU public need was not apprehende 1 a century ago. or to insist that what the provlalaa at the Consti- tution meant to the vision of that day it must mean to the visio i of our time. If by the statement that what the Constitution meant at the Uom of its adoption it means today, it is intended say that the great dauses of the Constitution must be confined the interpretation which the framera. with the conditions and out- look of their time, would have placed upon themw the atatemeut ••Laws of 1830 (N.T.). cha. 943-947. 951. con- in- RECORD— HOUSE January 10 carries its own refutation. It was to guard against such a narrow conception that Chief Justice MarshaU uttered the memorable warning. " We must never forget that it Is a constitution we are expounding" {McCulloch v. Aforyland, 4 Wheat. 316. 407) a constitution intended to endure lor ages to come. and. con- sequently, to be adapted to the varlotis crises of human affairs (S., p. 416). When we are deaUng with the words of the Constltu- Uon, said this Court in Missoun v. Holland (252 US. 416 433), " We must realize that they have caUed Into life a being the de- velopment of which could not have been foreseen completely by the most gifted of its begetters. • • • The case before us must be considered in the light of our whole experience and not merely in that of what was said a hundred years ago." Nor is it helpful to attempt to draw a fine distinction between the Intended meanlno: of the words of the Constitution and their intended application." When we consider the contract clause and the decisions which have expounded It In harmony with the essential reserved power of the States to protect the security ol their peoples, we find no warrant for the conclusion that the claxise has been warped by these decisions from Its proper signlfl- cance or that the founders of our Government would have Inter- preted the clause differently had they had occasion to assume that responsibility In the conditions of the later day. The vast body of law which has been developed was unknown to the fathers but It is believed to have preserved the essential content and the spirit of the Constitution. With a growing recognition of public needs and the relation of Individual right to public security, the court has sought to prevent the perver.'jlon of the clause through Its use as an Instrument to throttle the capacity of the States to protect their fundamental Interests. This develop- ment Is a growth from the seeds which the fathers planted. It Is a development forecast by the prophetic words of Justice Johnson in Ogden v. Saunders, already quoted. And the germs of the later decisions arc found In the early cases of the Charles River Bridge and the West River Bridge, supra, which upheld the public right against strong Insistence upon the contract clause. The principle of this development is. as we have seen, that the reservation of the reasonable exercise of the protective power of the State is read Into all contracts and there Is no greater reason for refusing to apply this principle to Minnesota mortgages than to New York leasee. Applying the criteria established by our decisions we conclude: 1. An emergency existed In Minnesota which fumLshed a proper occasion for the exercise of the reserve power of the State to protect the vital interests of the community. The declarations of the existence of this emergency by the legislature and by the Supreme Court of Minnesota cannot be regarded as a sub- terfuge or as lacking In adequate basis {Block v. Hirsh. stipra) . The flnriing of the legislature and State court has support In the facU of which we take Judicial notice (ittc^toon, T. «fr S. F. Ry. Co. V. United States, 284 UB. 248, 260). It Is futUe to attempt to make a comparative estimate of the seriousness of the emergency shown in the leasing cases from New York and of the emergency disclosed here. The particular facts differ, but that there were in Minnesota conditions urgently demanding relief, if power existed to give it, is beyond cavil. As the Supreme Court of Minnesota said, the economic emergency which threatened " the loss of homes and lands which furnish those in possession the necessary shelter and means of subslstexMse " was a ' potent cause " for the enactment of the statute. 3. The legislation was addressed to a legitimate end, that is, the legislation was not for the mere advantage of particular individuals but for the protection of a basic interest of society. 8. In view of the nature of the contracts in question— mort- gitges of unquestionable validity — the relief afforded and Justi- fied by the emergency. In order not to contravene the constitu- tional provision, could only be of a character appropriate to that emergency and could be granted only upon reasonable conditions. 4. The conditions upon which the period of redemption is ex- tended do not appear to be unreasonable. The initial extension of the time of redemption for 30 days from the approval of the act was obviously to give a reasonable opportunity for the authorized application to the court. As already noted, the Integrity of the mortgage Indebtedness Is not Impaired; Interest continues to run; the validity of the sale and the right of a mortgagee-purchaser to title or to obtain a deficiency Judgment, If the mort:^a';or falls to redeem within the extended period, are maintained; and the con- ditions of redemption. If redemption there be, stand as they were under the prior law. The mortgagor during the extended period Is not ousted from possession, but he must pay the rental value of the premises as ascertained in Judicial proceedings and this amount is applied to the carrying of the property and to Interest upon the Indebtedness. The mortgagee-purchaser during the time that he cannot obtain possession thus Is not left without com- pensation for the withholding of possession. Also Important Is the fact that mortgagees, as Is shown by official reports of which we may take notice, are predominantly corporations, such as Insurance companies, banlcs, and Investment and mortgage companies.** Tltese, and such Individual mortgagees as are small investors, are not seeking homes or the opportunity to engage In farming. Their chief concern Is the reasonable protection of their invustment eecurlty. It does not matter that there are. or may be. Individual cases of another aspect. The legislature was entitled to deal with the general or typical situation. The relief afforded by the statute >* Department of Agriculture, Technical Bulletin No. 288. Feb. 1932. pp. 22. 23; Yearbook. Department of Agriculture, 1932, p. 913. i<-«/^-»rv^T A v T»T:«/^/-iT»T\ TT/^TTO"C T A XTTT » OV 1 (I 1934 CONGRESSIONAL RECORD— HOUSE 87S has regard to the Interest of mortgagees as well as to the interest of mortgagors. The legislation seeks to prevent the Impending ruin of both by a considerate measure of relief. In the absence of legislation, courts of equity have exercised Jurisdiction In suits for the foreclosure of mortgages to flx the time and terms of sale and to refuse to confirm sales upon equitable grounds where they were found to be unfair or Inade- quacy of price was so gross as to shock the conscience." The •' equity of redemption " Is the creature of equity. While courts of equity could not alter the legal effect of the forfeiture of the estate at common law on breach of condition, they succeeded, operating on the conscience of the mortgagee. In maintaining that It was unreasonable that he should retain lor his own benefit what was Intended as a mere security; that the breach of condi- tion was In the nature of a penalty, which ought to be relieved against, and that the mortgagor had f.n equity to redeem on I>ayment of principal. Interest, and costs, notwithstanding the forfeiture at law. This principle of equity was victorious against the strong opposition of the common-law Judges, who thought that by " the growth of equity on equity the heart of the common law Is eaten out." The equitable principle became firmly estab- lished and Its application could not be frustrated even by the engagement of the debtor entered into at the time of the mort- gage, the courts applying the equitable maxim " once a mortgage, always a mortgage, and nothing but a mortgage." *» Although the courts would have no authority to alter a statutory period of re- demption, the legislation In question permits the courts to extend that period within llmlU and up>on equitable terms, thus providing a procedure and relief which are cognate to the historic exercise of the equitable Jurisdiction. If It be determined, as It must be, that the contract clause Is not an absolute and utterly unqualified restriction of the State's protective power, this legislation Is clearly so reasonable as to be within the legislative competency. 5. The legislation is temporary in operation. It Is limited to the exigency which called It forth. While the postponement of the period of redemption from the foreclosure sale Is to May 1, 1935, that period may be reduced by the order of the court under the statute, In case of a change in circumstances, and the operation of the statute Itself could not validly outlast the emergency or be so extended as virtually to destroy the contracts. We are of the opinion that the Minnesota statute as here applied does not violate the contract clause of the Federal Constitution. Whether the legislation is wise or unwise as a matter of policy is a question with which we are not concerned. What has been said on that point Is also applicable to the con- tention presented imder the due process clause (Block v. Hirah, aupra ) . Nor do we think that the statute denies to the appellant the equal protection of the laws. The classification which the statute makes cannot be said to be an arbitrary one {Magoun v. /IM»iot» Trust & Savings Bank. 170 UJS. 283; Clark v. Titusville. 184 VS. 32^; Quong Wing v. Kirkendall, 223 UJS. 59; Ohio Oil Co. V. Conway, 281 UJ3. 146; Sprolea v. Binford, 286 U.S. 374). The Judgment of the Supreme Coiut of Minnesota Is afOrmed. Judgment affirmed. SxTPBCMS CouxT or TBI UwrrKD STATSa No. 370.— October Term, 1033 HOME Btrn.DTWO * LOAlf ASSOCIATION, ATPCLLAirT, V. JOHN R. MLASMOKLL AND BOSXIXA BLAISOKLL, HIS WITC. APPCAL FBOM TUX SITPBSMX ootrsT or the statb or Minnesota ^Jan. 8, 1934] Mr. Justice Sutherland, dissenting. Pew questions of greater moment than that Just decided have been submitted for Judicial inquiry during this generation. He simply closes his eyes to the necessary Implications of the de- cision who falls to see in it the potentiality of future gradtial but ever-advancing encroachments upon the sanctity of private and public contracts. The effect of the Minnesota legislation, though serious enough in Itself, is of trivial significance com- pared with the far more serious and dangerous inroads upon the limitations of the Constitution which are almost certain to ensue as a consequence naturally following any step beyond the bound- aries fixed by that instrument. And those of us who are thus apprehensive of the effect of this decision would, in a matter so important, be neglectful of otir duty should we fall to spread upon the permanent records of the Covut the reasons which move us to the opposite view. A provision of the Constitution, it Is hardly necessary to say, does not admit of two distinctly opposite interpretations. It does not mean one thing at one time and an entirely different thing at another time. If the contract-impairment clause, when framed and adopted, meant that the terms of a contract for the payment of money could not be altered in Invltum by a State statute en- ^Orafjam v. Burgeaa (117 VB. 180. 191, 192); Schroeder v. Young (161 UJS. 334, 337); Ballentyne v. Smith (205 UJS. 286. 290); HotoeU V. Baker (4 Johns, ch. 118. 121); GUbert v. Haire (43 Mich. 283. 286); LitteU v, Zuntz (2 Ala. 256, 260, 262); Insurance Co. v. Stegink (106 Kans. 730); Strong v. Smith (68 N J.Bq. 650, 663); compare Suring State Bank v. Gieae (346 N.W. (Wis.) 666). "See Coote's Law of Mortgages. 8 ed.. vol. 1, pp. 11. 12; Jones on Mortgages. 8 ed., vol. 1, sees. 7, 8; Lang ford v. Barnard, Tot- hiU (134, temp. Ells): Emmanuel College v. Evans (1 Rep. in ch. 10. temp. car. I); Roscarrick v. Barton (1 Ca. In ch. 217); Noakes V. Rice (1902), (A.C. 24, per Lord Macnagllten); Fairckmgh v. Swan Brewery (81 VJ.P.C. 307). acted for the relief of hardly presaed debtors to tbs and and with the effect of postponing payment or enforcement during and be- cause of an economic or financial emergency. It is but to stata the obvious to say that it means the same now. This vlaw. n* once so rational in its application to the written word, and so necessary to the stobility of constitutional prinelplea. though from time to time challenged, haa never, unleas recently, been put within the realm of doubt by the dectsiona of this Court. The true rule was forcefully declared in Ex parts MUUgan (4 Wall. 3. 120-121). in the face of circumatanoaa at national peril and puUlo unrest and disturbance far greater than any that ezlat today. In that great case this Court said that the provialona of the Consti- tution there under consideration had been expreaaed by our an- cestors In such plain English words that it would aa«a the !■••- nuity of man could not evade tham, Imt that aft«r the lapaa ol more than 70 years they were sought to be avf^ded. " Tboaa great and good men ", the Court said, " foreaaw that trouhtous times would ariae, when rulers and people would haeama restlv« under reatraint, and seek by sharp and decisive meaaurea to ac- complish ends deemed Just and proper; and that the princlidas of constitutional liberty would be in peril, unleas aetabuahed by irrepealable law. The history of the world had taught them that what was done In the past might be attempted in the future."'' And then, in words the power and truth of which have beeoma increasingly evident with the lapse of time, there was laid down the rule without which the Constitution woxild cease to be the "supreme law of the land", binding equaUy upon governments and governed at all times and under all circumstances, and be- come a mere collection of political maxims to be adhered to or disregarded according to the prevailing Sbntlment or the legisla- tive and Judicial opinion in respect of the suppoaed necessities of the hour: " The Constitution of the United SUtea is a law for rulers and people, equally in war and in peace, and covers with the shield of its protection all classes of men, at all times, and under all cir- cumstances. No doctrine, involving more pernicious oonsequences, was ever invented by the wit of man than that any of its provi- sions can be suspended during any of the grei.t exigencies of gov- ernment. Such a doctrine leads directly to anarchy or despotism. Chief Justice Taney, In Dred Seott v. Sandford (19 How. SOS. 426), said that while the Constitution remains unaltered it must be construed now as it was understood at the time of its adoption; that it is not only the same In words but the same in meaning. " and as long as It continues to exist in its present form, it speaks not only in the same words, but with the same meaning and intent with which it spoke when it came from tha hands of Its framers, and was voted on and adopted by tha people of the United States. Any other rule of construction wotild abrogate tha Judicial character of this court, and make it the mere reflex of tha popular opinion or passion of the day." And in South Carolina ▼. United Statea (109 U.S. 487, 448-449). In an oplxUon by Ifc. Justloa Brewer, this Court quoted these words with approral and said: " The Constitution is a written instnmient. As such Its mean- ing does not alter. That which It meant whan adopted It means now. • • • Those things which are within Its granto of powsr. as those grants were understood when made, are still within them, and those things not within tham remain still sxeludad." The words of Judge Campbell, speaking for tha Suprems Ootirt of Michigan in TwtteheU ▼. Blodgett (13 Mich. 137. 189-140). art peculiarly apposite. *' But It may easily happan ". bs said, " that specific provisions may. in unforeseen amerganclas, tturn out to have been inexpedient. Thla does not maks thsas proirtsions any less binding. Constitutions cannot be chanfsd by arents alona. They remain binding as tha seto of tha paopla In thslr sovwslgB capacity, as the framers of forsmment, tintll ttaay ars amandad or abrogated by tha action preacrlbad by tha authority which created them. It U not competent for any department of tha Government to change a constitution, or declare It ehangad, singly because it appears ill-adapted to a new stata of thlnss. " • • • Restrictions have, it is true, been found more llkaly than grants to be unsultad to unforsaasn dreumstanoea • • •. But where evils arise from the application of such regulations, their force cannot be denied or evaded; and the remedy consists in repeal or amendment, and not in false oonstmctiona." The provisions of tha Federal Constitution, tmdoubtedly. are pliable in the sense that in appropriate cases they have the ca- oadty of bringing within their grasp every new condition which fSSe within their meaning.* But, their meaning Is changeless; it is only their appUcatlon which is extensible. (See South Caro- lina V. United States, aupra. pp. 44*^449.) Constitutional granta of power and restrictions upon the exerelse of power srs not flexible as the doctrines of the common Uw are fl^bte. Tbam doctrines, upon the principles ai the common law itsalf, modUy or abrogate themselves whenever thay are or whenever thoy be- come n^lnly vinstilted to different or changed oondlttona. Funk r United States (— UJB. — ) . decided December 11. 198S. Tha dls- » In such cases it Is no more neoeaaary to modify ccmstltutional rules to govern new conditions than it is to ersate new words to describe them. The commerce cUuae la a good example. Whan that was adted lU aiH>lication was neoeeaarUy confined to tha rejrulatlon of the primitive methods of tranqxirUtlon then em- ployed; but railroads, automobllea. and aircraft automatlcaUy ware brought within the scope and subject to the tenna of the com- merce elauae the moment theae new means of transportatioii earns Into existenoe, Jiist as they ware at once brought within the " ing o< tha woe* " cairlar ", as defknad by the dictlonartaa 1QQ/I rnNnPF.SSTONAT. RF.nORn — HOTTSR 375 '•Law* of 18a0 (N.T.). cb*. 942-M7. 951. I 1S32. pp. 22. 23; Yearbook. Department of Agriculture, 1932. p. 913. i\j, Mfxnp. car. *;, nuai^uiimn. *. t»i»i n^i» \.» v^— »" ~- V. Rice (1902). (A.C. 24, per Lord Macniigl1t«in); Swan Brewery (81 LJJ>.C. 207). Fairclough v. Into exlstenoe, Jurt m tl»«y w«n» »t onoa brougnt wiuunuu ^S^w^ "cairtar". m dcflsMl by tb* dicUooMlv. 1 > i 374 CONGRESSIONAL ttnetton ia deuty potnted oat by Jodge Cooley (1 Oo«»tttutkM»l Llinltatkm*. ttb ed., 124) : ^ "A prlnctpaa ftbare of the ben^ts expected fra«n written eonsu- tutlooa would be lort If tbe rule* they ertabllshed were so flexible •• to bend to drcuaortances or be modifled by public opinion. It !• with special r«ference to the rarying mooai of pubUc optnlon, and with a view to putting the fundamentals of government be- yond their control, that these InstrumenU are framed; and thsre can be no such steady and ImperoepUble change to their rulse as Inheres In the pclnctples of the common law. These benefloent pi^xitTM of the common law which guard person and propvty have grown and expanded untU they mean TasUy more to us than they did to ova minsifisii and are more minute, particular, andper- vadlng In their protections: and we may conftdently look forward In the future to still further modlflcattons In the dlrsctkm of tan- prorement. PubUc sentlrjent and aeUon effect such changes, and the courts recognlae them: but a court or legislature wblefa should allow a chaise In public sentiment to Inflwence tt In giving to a written constitution a construction not warranted by the Inten- tion of its founders, would be Justly chargeable with reckless dis- regard of cAdal oath and public duty: aiul If Its course could fcff^y^K a ptecedcnt. these Instrunaente would be of tittle a-vall. • * • What a court Is to do. therefore. Is to declare the law as written, IcaTtng it to the people themselves to make such changes t» new drcumstaaeeB may require. Ths meaning of the ConstltU' tkm Is fixed when it U adopted, and it Is not different at any sub- seqtient ttoM when a court has occasion to pass upon tt." The whole aim of construction, as apphied to a proyislon of the Constitution. Is to dtocorer the meaning, to ascertain and glvfl effect to the Intent, of Its framers and the people who adopted 11 {Lake Coitntf v. RoUms. 130 US. M2. 870). Tbe necessities which gave rise to the provision, the controversies which preceded, aa well as the conflicts Inaietently urged. A violation of the faith of the Nation or thi) pledges or tbe private individual, it was insisted, was equally for ^4>V^ \ff Om principles of moral Justice and of sound policj. Individual dlstreaa. It was urged, shoold be alleviated only by in ' tfustry and frugality, not by relaxation of law or by a sacrifice o '. tbe rlghte of others. Indiscretion or Imprudence was not to b ' relieved by legislation, but restrained by the conviction that a fuJ [ oompllanoe with eontracte would be exacted. On the other banc , tt was Insisted that the case of the debtor should be viewed wit] i tenderness; and efforte were constantly directed toward relievln \ him from an exact compliance with his contract. As a resul • of the latter view, Stete laws were passed suspending the col- lection of debte. remitting or suspending the coQectlen of taxes, providing for the emission of paper money, delaying legal pro- eeedlnga. ete. Tliere followed, as there must always follow froii auch a course, a long trail of UIs, one of the direct consequence s being a loss of confidence In the Government and to the goo I faith of the people. Bonds of men whose ability to pay their debt s was unquestionable could not be negotiated except at a dlscoun i of SO. 40. or 80 percent. Real property oouM be sold only at » ruinous loaa. Debtors, instead of seeking to meet their obUgatlor i by painful MTort, by todustry and economy. iMgan to reaC thel r hopes entirely uptm legislative Interferezkoe. "nw luipuasfbUtty o r payment of pubtte or private debte was widely asserted, and lii seoae inatanoea tbreate were made of sospendlag the adialwtatra ■ tlon at Jnstlce by vtolenoe. Tbe circulation of depieciated cunenc r Reeentment against lawyers and eoorU ws i to many instances tbe courae of the law wa i tn tfca aisitliiii « t RECORD— HOUSE January 10 their duty by popular and tmnultnous sasemblages. This state of things alarmed all thoughtfxd men. and led them to seek aomo effective remedy (MarshaU. Life of Washington (1807), vol. 5, py. 88-131). That this brief outline of the situation Is entirely aoctirate la borae out by all contemporaneous history, as well as by writers of dlatlnctlon of a later polod.' (Compare Edwardt v. Kearzejf. M *Thua ilcMaater (History of the People of the United States, vol. 1, p. 436), after referring to the conditions in Rhode Island, where "the bonds of society were dissolved by paper money and tender laws"; in New Jersey, where the people nailed up the doors of their court hovtses; in Virginia, where the debtors " sei flte to theirs In order to stop the course of Justice ", says: " The newspapers were full of bankrupt notices. The farmers' taxes amounted to near the rent of their farms. Mechanics wandered up and down the streets of every city destitute of work. Ships, sbut out from every port of Europe, lay rotting in the harbors " Cliannlng (History of the United Stetea, vol. 8. pp. 410-411, 48S-483) paints this graphic picture of the situation: "Nowhere was the immediate prospect more gloomy than tn South Carolina. • • • In Massschusette, at the other end of the line, the case was as bad. If not worse • • • the leeouroes of New England were Insufflclent to pay even what was then owing. The case of New York was even more desperate, and for tbe moment Philadelphia alone seemed prosperous, for the wastage of the later years ot the war had been severely felt In Virginia. • • • " • • • Virginia was honeycombed with debt. • • • •• In South Carolina the planters were even more heavily In ilebt. • • • The case of Thomas Bee is to the point. His creditors had secured executions against him; the sheriff had seized his property and had sold it at one thirteenth of what it would have brought at private sale in ordinary times." Nevlns (The American States During and After the Revolution. p. 536) says: " The town of Greenwich computed that d\irlng each of the 5 years preceding 1786 the farmers had paid In taxes the entire rental value of their land." John Flake (The Critical Period of American History, 8th ed., pp. 175. 180) thtis describes conditions: " • • • about the market-places men spent their time angrily dlscxissing politics, and scarcely a day passed without stieet fights, which at times grew into rlote. In the country, too, no less than In the cities, the goddess of discord reigned. The farmers determined to starve the city people into submission, and they entered Into an agreement not to send any produce into the cities until the merchants should open their shops and begin selling their goods for paper (money) at IM face value • • • the farmers threw away their milk, used their com for fuel, and let their apples rot on the ground. • • • " • • • the courts were broken up by arTH.-sl mobs. At Con- cord one Job Shattuck brought several hundr-d armed men into the town and surrounded the courthouse, while li» a fierce harangue he declared that the time had come for wiping out all debts." Dr. David Ramsay (History of the United States. 2d ed.. 1818. vol. 3, pp. 46-47), a Member of the old Congress under the Con- federation, and who lived In the midst of the events of which he speaks, says: " The nonpayment of public debts sometimes Inferred a neces- sity, and always furnished an apology for not discharging private contracts. Confidence between man and man received a deadly wound. Public faith being first violated, private engagements lost much of their obligatory fca^:e. • • • " Prom the combtoed operation of these causes trade languished; credit expired; gold and silver vanished; and real property was depreciated to an extent equal to that of the depreciation of con- ttoental money. • • • •• And, finally, George Tlcknor Curtis, in his History of the Origin, Formation, and Adoption of the Constitution of the United Stetes (vol. 1, p. 332-333) : "All contemporary evidence assures us that this (1783 to 1787) was a period of great pecuniary distress, arising from the deprecia- tion of the vast quantities of paper money Issued by the Federal and State governments; from rash speculations: from the un- certain and fiuct listing condition of trade: and from the great amount of foreign goods forced into the country as soon as Ite porte were opened. Naturally, in such a st.ate of things, the debtors were disposed to lean in favor of those systems of govern- ment and legislation which would tend to relieve or postpone tbe payment of their debts: and as such relief could come only from tbelr Stete govcnmients, they were naturally the friends of Stete rights and State authority, and were consequently not friendly to any enlargement of the powers of the Federal Constitution. The same causes which led Individuals to look to legislation for Irregular relief from the burden of their private contracts, led tfaena also to regard public obligations with similar impatience. Opposed to this numn In no. 44. Madison oonduded his defense of the clause by aaytng: ^ ^ ,^ .__» ,. ^ # " • • • ftoB leglsiatlTe Interference is but Uie first unK oi a long chain of repeUUons. every subsequent Interference being naturaUy produced by the eilecU of the fneeOlnt. Tbey Tery rightly infer, therefore, that eome thorough reform Is wanting, which will banish speculations on public measurea. Inspire a gen- eral prudence and Industry, and give a regular course to the bualnesB of society." Contemporaneous history is replete with evidence of the sharp conflict of opinion with respect to the advisability oi adopting the dauae. Dr. Ramsay (The History of South Carolina (1800). vol. a. pp. 431-433). already referred to. writing of the action ot South Carolina and eqjMCially referring to the contract Impairment clause, nys that this Constitution was accepted and ratified on behalf of the State, and speaks of it as an act of great lelf -denial : " The power thus given up by South CanAlna was one she thoi^^ht eMenttal to her welfare, and had freely exorcised for several preceding years. Such a relinquishment she would not have made at any period of the last 5 years; for In them she had peif rt no lees than six acts Interfering between debtor and creditor, with the view of obtaining a reeptte for the former under particular dreumstances of public distress. To tie up the hands of future legislatures so as to deprive them of a power of repeat- ing similar acts on any emergency, was a dlm>lay both of wisdom and magnanimity. It would seem as if experience had convinced the SUte of iU poUUeal errors, and induced a willingness to retrace Ita steps and relinquish a power which had been improperly used." There is an old case. Gla*e v. Drayton (1 DeS. Equ. (S.C.) 100). decided In I7M. where the South Carolina Court of Chancery entered a decree for the spedflc performance of a contract for the purchase of land, but providing for the payment of the balance due under the contract " by installments, at the times mentioned In the acts of assembly respecting the recovery of old debts." In reporting that case soon after the adoption of the Constitution, Chancellor DeSaussure added the following explanatory azid illu- minating note: "The legislature, in consideration of the distressed state of tlM country, after the war. had passed an act. preventing the im- mediate recovery of debts, and fixing certain periods for the pay- ment of debts, far beyond the periods fixed by the contract of the parties These interferences with private contracts became very common with most of the State legislatures, even after the dis- tresses arising from the war had ceased in a great degree. Tbey produced distrust and irritation throughout the community, to such an extent that n*w troubles were apprehended; and nothing contributed more to prepare the public mind for giving up a por- tion of the State sovereignty, and adopting an efficient national government than these abvi^es of power by the State legislatures." If it be possible by resort to the testimony of history to put any question of constltutionia Intent beyond the domain of uncer- tainty, the foregoing leaves no reasonable ground upon which to base a denial that the clause of the Constitution now under con- sideration was meant to foreclose State action Impairing the obli- gation of contracts prlnuurlly and especially in respect of such action aimed at giving relief to debtors in time of emergency. And if further proof be required to strengthen what already is Inexpugnable, such proof will be found In the previous decisions oi this eourt. There are many such decisions; but It Is necessary " TlM Convention then was asked to perfect their action in favor of honesty and morality, by adding a prohibition on the States which would put an end to statutes enacting laws for special in- dividuals, setting aside coort Judgments, repealing vested lights, altering corporate charters, staying the bringing or prosecution of suits, preventing foreclosure of mortgages, altering the terms of oontracta. and allowing tender In payment of debts of something other than that contracted for. Tbe State legislatures had hith- erto pswsed SQch laws in abiuidant measure, and the situation was graphically described later by Chief Jxistloe Marshall in one of his most noted dectstons {Ogden v. Saunders, 13 Wheat. 213, 354), as foUows: " ' The power of changing the relative eituaticm of debtor and creditor, of interfering with contracts, a power which con»3 home to every man. touches the interest of all. and controls the conduct of every Individual in those things which he supposes to be proper for his own exclusive management, had been used to such an excess by the State legislatures as to break In upon the ordinary intercourse of society and destroy all confidence between man and man. The mischief had become so great, so alarming, as not only to impair commercial Intercourse and threaten the existence of credit, but to sap the morals of the people and destroy the sanc- tity of private faith. To giiard against the continiiance of the evU was an object of deep Interest with all the truly wise as well as virtuous of this great community, and was one of the important benefits expected from a reform of the government.' " To obviate the conditions thus described. King of Massa- chusetts proposed tiie iasertion of a new restriction on the States. • * * Wilson and Madison supported his motion. Mason and O. Morris, however, believed that it went too far in interfering With the powers of the States. • • • There was also a genuine belief by some delegates that, under some circumstances and in financial crises, such stay and tender laws might be necessary to avert calamitous loss to debtors. • • • The oth«' dele- gates had be^ deeply impressed by the disastrous social and mt>ra>nwnir- effscts of ths Stay and tender laws which had been •nactad by most of the States between 1780 and 1788. and they dtffM^ to make similar Vuglsletion Impossible in tha future." RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 377 to refer to a few only which hew directly upon the question, namely: Brtmson v. Kinxie (1 How. 311); MeCracken v. Uayward (3 How. 808); Gantly's Lessee v. Ewing (3 How. 707); Howard v. Bugltee (24 How. 461); Gunn v. Barry (15 Wall. 610); Walker v. Whitehead (16 Wall. 314); Edunxrds v. Kearzey (»6 D.S. 596): Bamitz v. Beverly (163 U.S. 118); and Bradley v. Lightcap (195 UJB. 1). Branson v. Kimie was decided at the January term. 1843. Tha case involved an minoU statute, extending the period of redemp- tion for a period of 12 months after a sale iinder a decree in chancery, and another statute preventing a sale unless two thirds of the amount at which the property had been valued by ap- praisers should be bid therefor. This Court held t)Oth statutes Invalid, when applied to an existing mortgage, as Infringing the contract Impairment clause. No more need now be said as to the points decided. The opinion of the Court says nothing about an emergency; but it is clear that the statute was passed for the purpose of meeting the panic and depression which began in 1837 and continued for some years thereafter.'* And in the light of what U now to be said, it is evident that the question of that emergency as a basis for the legislation was so definitely Involved that it must have been considered by the Court. The emergency was quite as serious as that which the country has faced during the past 3 years. Indeed, it was so great that In one Instance, at least, a State repudiated a portion of its public debt, and others were strongly tempted to do so." Mr. Warren, In his book. The Supreme Court in United States History (vol. 2, pp. 376-379 ». gives a vivid picture of the situation. After refer- ring to Bronson v. Kimie and the statute extending the period of redemption therein dealt with, he p)oint8 to the prevailing state of business and finance which had called the statute into exlBtence; to the bank failures. State debt repudiations, scarcity of hard money, the InabUlty to pay debts except by disposing of property at ruinous prices; to the enactment of statutes for the relief of debtors, stay laws postponing collection of debU, etc., which had been passed by State after State; and to the action of this Court In striking down the State statute in the face of these conditions. " Unquestionably ", he continues. " the country owes much of its prosperity to the unflinching courage with which, in the face of attack, the Court has maintained Its Arm stand In behalf of high standards of business morale, requiring honest payment of debts and strict performance of contracts; and Its rigid construction of the Constitution to this end has been one of the glories of the Judiciary. That ita decisions should, at times, have met with disfavor among the debtor class was. however, entirely natural; and while, ultimately, these debtor relief laws have always proved to be injurious to the very class they were designed to relieve and to Increase the financial distress, fraud, and extortion, temporarily, debtors have always believed such laws to be their salvation and have resented Judicial decisions holding them Invalid. Conse- quently, this opinion of the Court In the Bronson case arous?d great antagonism in the Western States. In Illinois, a mass meet- ing was held which resolved that the decision ought not to be heeded, • • •. Later, deference to the antagonism aroused against tbe Court by this decision was made when the Senator from Illinois, James Semple, Introduced in the Senate in 1846, a Joint resolution proposing a constitutional amendment to prohibit the Supreme Court from declaring void ' any act of Congress or any State regulation on the ground that it is contrary to the Constitution of the United States • • • .' " McMaster (supra, note 2. vol. 7, pp. 44-48). Is to the same effect. MoCracken v. Haytcard. decided at the January term, 1844. dealt with the same Illinois statute, but Involved a sale on execution after Judgment, whereas Bronson v. Kimie Involved a mortgase. The decision simply followed the Bronson case. What has been said in respect of the background and setting of that case is equally applicable and need not be repeated. Gantly'a Lessee v. Ewing was decided at the January term. 1845. It held unconstitutional, as applied to a preexisting mortgage, an act of Indiana providing that no real property should be sold on execution for less than half Its appraised value. The statute, like those of Illinois, was enacted for the l)eneflt of hard-pressed debt- ors as a result of the same emergency. It is referred to by Mc- Master. supra, as one of the " marks on the statute books " which the " evU times through which the people were passing " had left. Howard v. Bugbee, decided at the December term. 1860, dealt vrlth an Alabama statute authorizing a redemption of mortgaged property In 2 years after the sale under a decree. The statute was declared unconstitutional principally upon the authority of BroTuon v. Kimie. The opinion is very short and does not refer to the question of emergency. The statute was passed, however, in 1842 (the mortgage having been executed prior thereto), and was. therefore, one of the emergency statutes of that period. The Alabama Supreme Court, whose decision was under review here, so treated it. and Justified the statute upon that ground (32 Ala. 713. 716-717). It Is worthy of note that after the decision of this court in the Bugbee case, Judge Walker, who delivered the opinion therein for the Alabama cotirt, filed a dissenting opinion in Ex parte PoOard, Ex parte Woods (40 Ala. 77, 110), in the course "See Dewey, Financial History of the United States (p. 229. et seq.); Schouler, History of the United States (vol. 4, p. 276, et seq.); McMaster, supra (note 2. vol. 6. pp. 389. et seq.. 523, et seq., 623. et seq.). "See Dewey, supra (note 15. p. 243. et seq.); McMaster, supra (note 2. vol. 6. p. 627. et seq.. vol. 7. p. 19, et seq.); Centennial History of Illinois (vol. 2, p. 231, et seq.). of which he said that his former opinion had been overr\iled by this court and he could no longer perceive any ground upon which the convictions of a legislature as to the welfare of the people could enlarge the authority to Interfere, through the manipulation of the remedy, with the obligation of contracts. The basis of the legislation was, and is shown by the decision of the Alabama Supreme Court sustaining it to be, the existence of the great emergency beginning In 1837; and that question, since the Alabama decision was reviewed, was quite plainly before this Court for conslder.itlon. Walker v. Whitehead, decided at the December term, 1872, held vinconstltutlonal a Georgia statute requiring the plaintiff, suing on a debt or contract, to prove as a condition precedent to the entry of Judgment In his favor that all legal taxes chargeable by law thereon had been duly paid for each year since the making of the debt or contract. The Georgia Supreme Court (43 Ga. 538, 544-546) had sustained the act as a measure mado necessary by the desperate financial and economic conditions In that State due to the ClvU War. This Court, making no response to the some- what fervid presentation of this view of the matter by the State court, simply said- that the degree of impairment was immaterial; that any impairment of the obligation of a contract Is within the prohibition of the Constitution; that " a clearer case of a law Im- pairing the obligation of a contract, within the meaning of the Constitution, can hardly occur." Edwards v. Kearzey, decided at the October term. 1877, held Invalid, as applied to a preexisting debt, the provision of the North Carolina Constitution of 1868 Increasing the exemptions to which a debtor was entitled. The North Carolina Supreme Court, in a series of decisions, had sustained the State constitutional provision, principally upon the ground (Garrett v. Chesire, 69 N.C. 396, 404-405) that It was adopted at a time when "probably one half of the debtor class are owing more old debts than they can pay "; and that " if under our clrcum.^tance6 our people are to be left without any exemptions, the policy of Christian civili- zation Is lost sight of • • •." In the brief of defendant in error in this Court (pp. 7-8) the view was strongly urged that the provision was not so much for the benefit of the debtor as for that of the State, to prevent the evils of almost universal pauperism. Attention was called to the desperate condition of the people of the State following the Civil War, and It was said that one third of the whole population were paupers, all their property except lands having disappeared; that one half of the people did not own land enough to afford burial for that propor- tion of the population; and against those who did own land the ante-war debts were piled mountain high. It was submitted that the State, on being rehabilitated, was not bound to allow the creditor to strip the few self-supporting landowners of their means of existence and thereby add them to the vast army of the im- poverished, but that it had the right to defer a portion of the creditor's claim until the prostrated community had opportvinity to recoup some of its losses. This Court, in response, reviewed the history of the adoption of the contract Impairment clause and held the State constitutional provision invalid. "Policy and humanity", it said, "are danger- ous guides in the dlsciission of a legal proposition. He who fol- lows them far is apt to bring back the means of error and delu- sion. The prohibition contains no qualification, and we have no judicial authority to interpolate any. [Italics added.] Our duty Is simply to execute it." Barnitz v. Beverly was decided May 18, 1896. A law of Kansas extended the period of redemption from a sale under a mortgage for a period of 18 months, during which time the mortgagor was to remain In possession and receive rents and profits, ex- cept as necessary for repairs. The act was passed in 1893 in the midst of another panic, the severity of which, still within the memory of the members of this Court, Is a matter of common knowledge. The effects of that panic extended Into every form of industry; bank failures were on an unprecedented scale; more than half the railroads of the country were In the hands of re- ceivers; securities fell to 50 percent, often to 25 percent, of their former value; commercial failures and unemployment became gen- eral; heavy inroads were made upcn public and private resources In caring for the hungry and destitute;" great bodies of idle men — the so-called " Industrial armies " — marched toward Washington, feeding like locusts upon the country through which they passed. These conditions were brought to the attention of this Court. In addition, the Supreme Court of Kansas (55 Kan. 466, 484-485), had relied upon them as a Justification for the legislation, and had Inquired why the State legislature In a time of general de- pression could not " extend the Indefinite estate impliedly re- served by the mortgagor, as the Federal courts of equity do in particular cases, beyond the 6 months allowed by the general practice "? In response to all of which, this Court, after reviewing its former decisions, held the statute Invalid as applied to a sale under a mortgage executed before Its passage. The present exigency Is nothing new. From the beginning of our existence as a nation, periods of depression, of Industrial fail- ure, of financial distress, of unpaid and unpayable Indebtedness, have alternated with years of plenty. The vital lesson that ex- penditure beyond Income begets poverty, that public or private extravagance, financed by promises to pay, either must end In complete or partial repudiation or the promises be fulfilled by self-denial and painful effort, though constantly taught by bitter "See Dewey, supra, note 15, p. 444. et seq.; Andrews. The Last Quarter Century in the United States, vol. II, p. 301. et seq. experience, seems never to be learned: and the attempt by legisla- tive devices to shift the misfortune of the debtor to the shoulders of the creditor without coming into conflict with the contract im- pairment clause has been persistent and oft-repeated. The defense of the Minnesota law is made upon grounds which were discountenanced by the makers of the Constitution and have many times been rejected by this Cotirt. That defense should not now succeed bccatise it constitutes an effort to over- throw the constitutional provision by an appeal to facts and cir- cumstances identical with those which brought it Into existence. With due regard for the processes of logical thinking, it legiti- mately cannot be urged that conditions which produced the rule may now be Invoked to destroy it. The lower court, and counsel for the appellees in their argument here, frankly admitted that the statute does constitute a material impairment of the contract, but contended that such legislation is brought within the State power by the present emergency. If I xmderstand the opinion Just delivered, this Court is not wholly in accord with that view. The opinion concedes that emergency does not create power, or Increase granted power, or remove or diminish restrictions upon power granted or reserved. It then proceeds to say. however, that while emergency does not create power. It may furnish the occasion for the exercise of power. I can only Interpret what is said on that subject as meaning that while an emergency does not diminish a restriction upon power, it furnishes an occasion for diminishing it; and this, as It seems to me, is merely to say the same thing by the use of another set of words, with the effect of affirming that which has Just been denied. It is quite true that an emergency may supply the occasion for the exercise of power, depending upon the nature of the power and the intent of the Constitution with respect thereto. The emergency of war furnishes an occasion for the exercise of certain of the war powers. This the Constitution contemplates, since they cannot be exercised upon any other occasion. The existence of another kind of emergency authorizes the United States to protect each of the States of the Union against domestic violence (Constitution, art. IV. sec. 4). But we are here dealing not with a power granted by the Federal Constitution, but with the State police power, which exists in Its owa right. Hence the question is not whether an emergency furnishes the occasion for the exer- cise of that State power, but whether an emergency furnishes an occasion for the relaxation of the restrictions upon the power Imposed by the contract impairment clause; and the difficulty Is that the contract Impairment clause forbids State action tmder any circumstances, if it have the effect of impairing the obliga- tion of contracts. That clause restricts every SUte power in tbe particular specified, no matter what may be the occasion. It does not contemplate that an emergency shall furnish an occa- sion for softening the restriction or making It any the less • restriction upon State action in ttiat contingency than It la under strictly normal conditions. The Minnesota statute either impairs the obligation of contracts or it does not. If it does not, the occasion to which it relates be- comes immaterial, since, then, the passage of the statute Is the exercise of a normal, unrestricted. State power and requires no special occasion to render it effective. If it does, the emergency no more furnishes a proper occasion for Its exercise than If the emergency were nonexistent. And so, while. In form, tbe sug- gested distinction seems to put us forward in a straight line. In reality it simply carries us back in a circle, like bewildered travelers lost in a wood, to the point where we parted company with the view of the SUte court. If what has now been said is sound, as I think It Is. we come to what really is the vital question in the case: Does the MlnneaoU statute constitute an impairment of the obligation of tbe contract now under review? In answering that question we must first of all distinguish the present legislation from those stetutes which, althovigh interfering m some degree with the terms of contracte, or having the effect of entirely destroying them, have nevertheless been sustained as not impairing the obligation of contracts In the constitutional sense. Among these statutes are such as affect the remedy merely, as to which this Court said In Bronson v. Kimie, supra (p. 316), and repeated In Edwards v. Kearzey, supra (p. 604), "Whatever belongs merely to the remedy may be altered according to the win of the SUte, provided the alteration does not Impair the obligation of the contract. But if that effect is produced, it is im- material whether it Is done by acting on the remedy or dlrecOy on the contract Itself. In either case it is prohibited by tbe Con- stitution." ,, . Another class of stetutes is illustrated by those exempting from execution and sale certain classes of property, like the tooU of an artisan Chief Justice Taney, in Bronson v. Kinzie, supra, qieak- ing obiter, said that a SUte might properly exempt necessary Im- Dlements of agrlcultvire, or the tools of a mechanic, or articles of necessity in household furniture. But this Court. In £du>ord« v. Kearzey supra struck down a provision of the North Carolina Constitution which exempted every homestead, and the dweUlng and buildings used therewith, not exceeding In value 81.000. on the eround of its unconstitutionaUty as applied to a contract already in existence. Referring to the opinion in Bronson v. Kimie, the Court said (p. 604) that the Chief Justice seems to have had to his mind the maxim " de minimis ". etc, " Upon no other ground can any exemption be Justified." ^^ .^ ^ It is quite true also that " the reservation of essential attributes of sovereign power is also read Into contracU "; and that the legis- lature cannot "bargain away the public health or the pubUc morals." Ocneral sUtutes to put an end to lottertea, the sale or 378 CONGRESSIONAL RECORD— HOUSE January 10 mi tie Of besn clau le. tie tie maa- eontra :t, kted le- made extst 3 e in Ibe rcalled into the military service. The coxirt held that this dered performance unlawful and that the contract was at an It said : ^^ " Here the parties clearly made their bargain on the foot^g that it shotild continue lawful for the plaintiff to render and the defendants to accept hi* services. The rendering and accept- ance of these services ceased to be lawfxil in July 1916, and there- upon the bargain came to an end." In In re SKipton. Anderson 11- ;he om- condlt Ion \iin lo.. qaae 3 apbU- the to mkde would tbat In 19. the e- Q- to contiact 6 jch Bearing in mind these aids toward determining whether an implied cozKlltlon may be read into a particular contract, le revert to the example already given with respect to an agreen for the manufacture and sale of intoxicating liquor. And lei suppose that the State. Instead of passing legislation prohibliing the manufacture and sale of the commodity, in which event doctrine of implied conditions would be pertinent, continue! recognize the general lawfulness of the business, but, because what it conceives to be a Jxisttfytng emergency, provides that time for the performance of existing contracts for future mi facture and sale shall be extended for a specified period of t It is perfecUy admissible, in view of the State power to probjlblt the business, to read Into the contract an Implied proviso to effect that the businees of manufacturing and selling intozlca liquors ahall not, ]Hlor to the date when performance Is due, oome unlawful; but in the case last put. to read into the eoni a pertinent provisional exception in the event of intermedd State action wotild be more than unreasonable. It would be abelird since we must assume that the contract was made on the foo^g tliat so long as the obligation remained lawful ths ' intozlca' ing impaimsnt some- csn- clause would effectively preclude a law altering or nullifying U however exigent the occasion might be. That, in principle. Is precisely the case here. The contract is to repay a loan within a fixed time, with the express condition that upon failure the property given as security shall be soid. and that, in the absence of a timely redemption, title sliall be vested abso- lutely in the purchaser. This contract was lawful when made; and it has never been anything else. What the legislature has done is to pass a statute which does not have the effect of frustrat- ing the contract by rendering Its performance unlawful, but one which, at the election of one of the parties, postpones for a time the effective enforcement of the contractual obligation, notwith- standing the obligation, under the exact terms of the contract, remains lawful and possible of performance after the passage of the statute as it was before. The Rent cases {Block v. Hirsh, 256 U.C. 135; Marcus Brown Co. V. Feldman, 256 VS. 170; Levy Leasing Co. v. Siegel. 258 U£. 242) which are here relied upon, dealt with an exigent situation due to a period of scarcity of housing caused by the war. I do not stop to consider the distinctions between them and tl:ie present case or to do more than point out that the question of contract Impairment received little, if any, more than casual consideration. The writer of the opinions in the first two cases, speaking for this CoiiTt In a later case (Penna. Coal Co. v. Malion. 260 US 393. 416), characterized all of them as having gone "to the verge of the law." It. therefore, seems pertinent to say that decisions which confessedly escape the limbo of tinconstltutionallty by the exceed- ingly narrow margin suggested by this characterization should be applied toward the solution of a doubtful question arising In a different field with a very high degree of caution. Reasonably considered, they do not foreclose the question here involved, and it should be determined upon its merits without regard to those cases. We come back. then, directly, to the question of Impairment. As to that, the conclusion reached by the Court here seems to be that the relief afforded by the statute does not contravene the constitutional provision because it is of a character appro- priate to the emergency and allowed upon what are said to be reasonable conditions. It is necessary, first of all. to describe the exact situation. Appellees obtained from appellant a loan of $3,800; and to secure Its payment, executed a mortgage upon real property consisting of land and a 14-room house and garage. The mortgage con- tained the conventional Minnesota provision for foreclosure by advertisement. The mortgagors agreed to pay the debt, together with Interest and the taxes and Insurance on the property. They defaulted; and. In strict accordance with the baj-gain. appellant foreclosed the mortgage by advertisement and caused the premises to be sold. Appellant itself bought the property at the sale for a 8\un equal to the amount of the mortgage debt. The period of redemption from that sale was due to expire on May 2. 1933; and, assuming no redemption at the end of that day. under the law in force when the contract was made and when the property was sold and in accordance with the terms of the mortgage, appellant would at once have become the owner In fee and entitled to the Immediate possession of the property. The statute here under attack was passed on April 18. 1933. It first recited and declared that an economic emergency existed. As applied to the present case, it arbitrarily extended the period of redemption expiring on May 2. 1933. to May 18. 1933 — a period of 16 days; and provided that the mortgagor might apply for a further extension to the district court of the county. That court was authorized to extend the period to a date not later than May 1. 1935. on the condition that the mortgagor should pay to the creditor all or a reasonable part of the Income or rental value, as to the court might appear Just and equitable, toward the payment of taxes. Insiirance. Interest, and principal mortgage Indebtedness, and at such times and in such manner as should be fixed by the court. The court to whom the application in this case was made ex- tended the time until May 1. 1935, upon the condition that payment by the mortgagor of the rental value, $40 per month, should be made. It will be observed that whether the statute operated directly upon the contract or indirectly by modifying the remedy. Its effect was to extend the period of redemption absolutely for a period of 16 days, and conditionally for a period of 2 years. That this brought about a substantial change in the terms of the contract reasonably cannot be denied. If the statute was meant to oper- ate only upon the remedy. It, nevertheless, as applied, had the effect of destroying for 2 years the right of the creditor to enjoy the ownership of the property, and consequently the correlative power, for that period, to occupy, sell, or otherwise dispose of It as might seem fit. This postponement, if it had been vmconditlonal. undoubtedly would have constituted an unconstitutional impair- ment of the obligation. This Covirt so decided in Branson v. Kimie, supra, where the period of redemption was extended for a period of only 12 months after a sale under a decree; In Howard V. Bugbee, supra, where the extension was for 2 years; and in Bamitz v. Bexerly, supra, where the period was extended for 18 months. Those cases, we may assume, still embody the law, since they are not overruled. The only substantial difference between those cases and the present one Is that here the extension of the period of redemption and postponement of the creditor's ownership, is accompanied by the condition that the rental vaSue of the property shall, in the meantime, be paid. Assuming for the moment, that a statute extending the period of redemption may be upheld if something of commensurate value be given the creditor by way of compensation. 1934 CONGRESSIONAL RECORD— HOUSE 379 a conclusion that payment of the rental value during the 2 years' period of postponement Is even the approximate equivalent of immediate ownership and possession is purely gratuitotis. How can such payment be regarded, in any sense, as compensation for the postponement of the contract right? The ownership of the projjerty to which pjetitioner was entitled carried with it not only the right to occupy or sell it, but, ownership being retained, the right to the rental value as well. So that in the last analysis petitioner simply is allowed to retain a part of what is its own as compensation for surrendering the remainder. Moreover, it can- not be foreseen what will happen to the property during that long period of time. The buildings may deteriorate in quality; the value of the property may fall to a sum far below the purchase price; the financial needs of apf>ellant may become so pressing as to render it urgently necessary that the property shall be sold for whatever it may bring. However these or other supposable contingencies may be, the statute denies appellant for a period of 2 years the ownership and possession of the property — an asset which, in any event. Is of substantial character, and which possibly may tiu-n out to be of great value. The statute, therefore, is not merely a modi- fication of the remedy; It effects a material and injurious change in the obligation. The legally enforceable right of the creditor when the statute was passed was. at once upon default of re- demption, to become the fee simple owner of the property. Ex- tension of the time for redemption for 2 years, whatever com- pensation be given In its place, destroys that specific right and the correlative obligation, and does so none the less though it assiime to create in Invltum another and different right and obli- gation of equal value. Certainly, if A should contract with B to deliver a specified quantity of wheat on or before a given date, legislation, however much it might purport to act upon the remedy, which had the effect of permitting the contract to be discharged by the delivery of corn of equal value, would subvert the constitutional restriction. A statute which materially delays enforcement of the mort- gagee's contractual right of ownership and possession does not modify the remedy merely; it destroys, for the period of delay, all remedy so far as the enforcement of that right is concerned. The phrase. " obligation of a contract ", in the constitutional sense Imports a legal duty to perform the specified obligation of that contract, not to substitute and perform, against the will of one of the parties, a different, albeit equally valiuible, obligation. And a State, under the contract Impairment clause, has no more power to accomplish such a substitution than has one of the parties to the contract against the will of the other. It cannot do so either by acting directly upon the contract, or by bringing about the result under the guise of a statute in form acting only upon the remedy. If it could, the efficacy of the constitu- tional restriction would, in large measure, be made to disappear. As this Court has well said, whatever tends to postpone or retard the enforcement of a contract, to that extent weakens the obli- gation. According to one Latin proverb, " l^e who gives quickly, gives twice ", and according to another, " He who pays too late, pays less.' "Any authorization of the postponement of payment, or of means by which such postponement may be effected, is In conflict with the constitutional inhibition " {.Louisiana v. New Orleans, 102 U^S. 203, 207). I am not able to see any real dU- tlnctlon between a statute which In substantive terms alters the obligation of a debtor-creditor contract so as to extend the time of Its performance for a period of 2 years and a statute which, though in terms acting upon the remedy, Is aimed at the obliga- tion (as dlstlngiUshed, for example, from the Judicial procedure incident to the enforcement thereof) and which does in fact withhold from the creditor, for the same period of time, the stipulated fruits of his contract. I quite agree with the opinion of the Court that whether the legislation under review is wise or unwise Is a matter with which we have nothing to do. Whether it is likely to work well or work ill presents a question entirely irrelevant to the Issue. The only legitimate inquiry we can make la whether it is constitu- tional. If it is not. its virtues, if it have any, cannot save it; if It is, its faults cannot be invoked to accomplish Its destruc- tion. If the provisions of the Constitution be not upheld when they pinch as well as when they comfort, they may as well be abandoned. Being unable to reach any other conclusion than that the Minnesota statute Infringes the constitutional restric- tions under review, I have no choice but to say so. I am authorized to say that Mr. Justice Van Devanter, Mr. Justice McReynolds, and Mr. Justice Butler concur in this opinion. Mr. LUNDEEN. Mr. Speaker, in accordance with permis- sion granted to include in my remarks certain material rela- tive to the United States Supreme Court decision of January 8, 1934, upholding the Minnesota mortgage moratorium law, I now present a report of newspaper and magazine state- ments, issued shortly after this historic decision was handed down. From coast to coast the significance of the decision was noted. The New York Times contains a telegram of Matthew Napear, chairman of the Consolidated Home Owners' Mort- gage Committee, to Hon. Herbert H. Lehman, Governor of the State of New York. Note the statement that the dis- tinguished former Member of this body, the Honorable F^oreUo H. LaOuardia. on behalf of the farm and home owners, advocated a bill like the Minnesota mortgage mora- torium law for the State of New York. Frienda of the home owners and farm owners will be Interested in securing copies of the proposed New York moratorium law from the Con- solidated Home Owners' Mortgage Committee, room 1712, 315 Fourth Avenue, New York City. FoaECLOstnts Stat Asked or Lxhman — Horn Owmaa' Boor A»vo- CATEs Law Like IfiMHssoTA's. Just Upheld it Hiob Couet — " OENxniTE RELiEr " — MoEAToBiriM Enacted Hxut Last Sxjmmsb a Sad to Have Oki.t Agceavatbd Sttoatiom Governor Lehman was asked yesterday by the CoitBOlldated Hom* Owners' Mortgage Committee to recommend enactment of legtslft- tlon protecting home owners against foreclosures. In a telegram the gn^oup urged relief legislation along the lines o( the Minnesota statute, the constitutionality of which was upheUI last Tuesday by the United States Supreme Court. The plea WM signed by Matthew Napear, New York State chairman of the Con<* solldated Home Owners' Mortgage Committee, who led the march of home owners to Albany last Augtist. He said the biU submitted by his committee with the collaboration of Mayor LaOuardia at the special session of the legislature last svunmer had In it prac- tically the same provisions as the Minnesota law, and that the recommendations of Governor Lehman's advisory committee on home and farm mortgages also foUowed that law. The Minnesota law gives discretionary power to the courts to suspend foreclosure sales, provides for an upset price on fair valuation, and permits owners of foreclosed homes and farmsteads to redeem their property In 2 years. The telegram to the Governor said: " Consolidated Home Owners' Mortgage Committee, New Tcwk State Division, calls upon you to follow lead of highest court and recommend to the leglslatvire genuine relief for more than miUlon owners of small homes and farmsteads menaced by rlslixg tide of foreclosures. Foreclosure moratorium passed by legislature has served to aggravate situation by seeming to provide legislative Justification for foreclosures where owners are unable to meet Interest or taxes. The case for adequate relief was eloquently stated by advisory comnxlttee on home and farm mortgages, headed by Luc Ian R. Eastman. Without protection of home owner and farmer from foreclosure menace, recovery cannot go forward." [Prom the New York Herald Tribune, Jan. 9. 1934) Mortgage MoRAToartTM Upheld in United States Supreme Court BT » TO 4 — Hughes Joins I.TWERArji in View That Minnesota Law Extending Reliet to Mortgagor Is Valid — Indicates NJtA. Will Be Sustained — CoxnsT, However, Makes It Clear That Each Issue in Rbcoveby Program Will Be Judged on MERrrs Washington, January 8. — The Supreme Court of the United States, acting on the first of the new-deal cases brotight before it, divided 5 to 4 today In favor of emergency relief legislation. but made it clear that each Issue In the program would be decided on Its merits. _^,^ ^, Althotigh the decision had to do directly with the constitution- ality of the Minnesota moratorl\un law. It was recognised as hav- ing broad ramifications and as certain to go down In history as one of the most momentous rulings of the Court In recent years. LAW GIVES mortgage RKLIEr The State law und^r question extends the time for redemption of mortgaged property sold under foreclosure and contains other provisions Intended to reUeve persons hard pressed by mortgages. In rtiling that the Minnesota law did not violate the contract rights of mortgage holders imder the Federal Constitution, the majority of the Court indicated that It was not concerned wltto the question whether the legislation was good or bad but only with the right of a State to suspend provisions of contracts In emergencies. , ^ . ^^ _j^ . Holding that a State possesses authority " to safegtiard the vital interests of Its people", the decision pointed out that "emer- gency does not create power " under the Constitution, but " ni»y furnish the occasion for the exercise of power." ^ .. «w. * Great political significance was attached to the fact that Chief Justice <5iarles Evans Hughes Joined the so-caUed " liberal " group of the Cotirt and handed down the majority decision, which was concurred In by Associate JusUces Brandeis, Roberts, Cardoso. This majority for liberal policies recalled the report in recent months that President Roosevelt had entertained the thought of enlanring the Court to shift the balance of power from conserv- ative to liberal, if necessary, to Insure approval olt *^^n«»»«n[ program. With Chief Justice Hughes lining up with the Court liberals and providing a majority In favor of the Mlnne«>U law. the decision was interpreted as giving the President reason to believe he would have the Supreme Court backing he has openly requested without the necessity of reconsUtutlng the Court. SUTHERLAND READS DISSENT The dissenting opinion was read by Associate Justice Oeoige Sutherland, who was Joined by Associate Justices McReynrtdj^ Butler and Van Devanter. Both opinions were lengthy, and It reauirod about 2 hours of the time of the Court to hear them read. Despite the majority's observation that "emergency does not create power ". lU decision was widely heralded as meaning tb« maorrk-KTA r. "DTrmPn TTOTTSF. January 10 •trkO A nnxT/-^r>T7 UW uuu((»uuu n-iii»iiwwi r 380 CONGRESSIONAL RECORI>— HOUSE January 10 •▼entual ■urtalntog by th« Court of the J«^^««>f .^fSSJ^L ery effort, of the a«lmlnl«tr«Uon. Senate "^^=2"? ]S!;j^„°; j! tened to rtudy the decision. The fact that Chief /lutlee Hugl^ waa alined with the " liberal* " caused much oomsMnt. In effect, the MlnneeoU law la based on the right of a State suspend provisions of contracts In an emergency auch as prewnt economic one. The case was that of Home Building * AseoclatJon. appellant, against John H. BUlsdel. •»« « Blalsdell his wife The Supreme Court of Mtnneaota upheld law and the appeal to the highest Court was from that ^' couar riKDS emercenct juiri'uiao taw , tie Lroun Roae la tie 'trlbun il. The appellant atUcked the validity of the Minnesota law being repuijnnnt to the contract clause and the due process ' equal protwrtlon clauses of Oxe fourteenth amendment to Federal Constitution. ^^ ^ .^ An Important aspect of the majority opinion was that it nlzed that " an emergency existed In Minnesota which fui a proper occasion for the exercise of the reserved power of State to protect the vital Interests of the community." It fouad there " were In Minnesota conditions urgently demanding relief power existed to give It." This emergency threatened the loss homes and farms. The majority of the Court made It plain ' •uch conditions called for the exercise of aU the valid - power of the SUte to reach them If possible. As U well the Federal recovery legislation Is buUt on the proposition a national emergency akin to war is existent. The Court ruled that the contract clause of the was not "an absolute and utterly unqiiallfled restriction of State's protective power " over iu citizens as ahd t tie recllc necessity must be the predominant consideration In an erne _ It is not the first time the Constitution has bMn amaiided by Court I am in favor of the decision, but I recognise that it volves a stretch of the Constitution. The Superae Court, it long been rseognized. U not only JudlcUl but fcglalattve." Henstcr Nomaia. Progressive Republlcsn : " I am glad of it. win convince everybody, including the Supreme Court, that we trying to save this country. It will tend to bmtk up those •re seeking to reinforce the recovery legislation by amendment Senator BraNcs. Democrat: "I have said that the glory of country is that at all periods In time of crisis the courts as other branches of this Oovenunent have, as a rule, rr to the overwhelming will of the people. The decision is a tion of the fact that the Constitution is an Instrument that change with the changing conditions of our exlctanoe." respoi ded reco rnl- E lUSt read Ling recorery " 1XC11.I.KNT ". SATS JOHNSON Senator Joswson. Progressive Republican: " It Is a far opinion that will have a tremendotu effect upcm the pragram. I rvgard it as a moat excellent deelalon." Senator BamufZAO. Democrat : " I think it U sound. It's In really with formar precedents. Th« Suprtm* Court h«r«tofor« It are eho ." thU Rrell line sustained emergency legislation. We have been acting on that doctrine all the time. The decision In the Minnesota case fore- shadows that the recovery leglslaUon will be held constitutional." (Prom the New York Evening Poet, Jan. 10, 1934) MnnmoTA Bmawo to Aid Nrw N Jt-A. Bills in Congress— Also Ex- FccTED TO Bolster Recovxrt Moves in Lower Couxt Suits— To Curb Foes or Act— Highest Legal Tribunal Behind thx N«w Deal. Senator Wag.ver Declares By Robert S. AUen. Staff Correspondent of Evening Post Washington. January 10.— The United SUtes Supreme Court has Joined the ranks of the new deal. That wai the general authoritative consensus here following the Tribunal's 5-to-4 decision upholding the constitutionality of Minnesota's Emergency Mortgage Moratorium Act. ^ _. ^ Administration and progressive quarters were gratlfled by the victory, narrow though It was. Republicans and consarvatlve Democrats generally maintained glum silence. HI.STORIC SIGNinCANCK Privately, some of the former tried to minimize the importance of the Court's action. .» ,, ^ , They pointed out that the majority decision speclficallv declared that, whUe approval was given the act under consideration, it was not to be taken as a carte blanche endorsement of all emergency legislation. But both critics and endorsers were unanimous in the view tnat the Court's ruling was of far-reaching and historic significance. EESTRAINT ON FOES In administration circles satisfaction was predicated on three factors: „ ^ (1) The powerful effect the Supreme Court's verdict will have on lower courts. (2) The restraining Influence It Is certain to wield on certain business and financial interests who either covertly or openly are resisting or conspiring against the various recovery acts. (3) Th3 impetus the decision will give to promote enactment of additional emergency legislation that the administration will seek at this session of Congress. OTHER VICTORIES WOW The administration's recovery measures have already won sev- eral minor skirmishes in the lower courts. The Supreme Coiort of the District of Columbia recently dis- missed a case brought against the N11.A. A New York Federal bench has also upheld tlie gold -surrender order. The ruling m itself has no direct bearing on such pending con- troversies as the refusal of the Weirton Steel Co. and the E. G. Budd Manufacturing Co. to abide by the orders of the National lAbor Board. DOOmD TO DETEAT But. Indirectly. It does serve notice to these employers that a majority of the highest legal tribunal In the land is bshind the new-deal program, and that if they Intend forcing their re- sistance to an issue they are doomed to defeat. That point was particularly stressed by Senator Wagner. Chair- man of the National Labor Board and coauthor of the Industrial Recovery Act. and Senator George Norris, progressive leader. " It is highly gratifying to see the Supreme Court's complete i^preclation of the great economic and social problems that con- fronted Minnesota ". Wagner said. " I think that, likewise, the Court will appreciate the problems that confront Congress and the President in the same light. "* There can be no doubt of the constitutionality of the National Recovery Act. for it Is also based on an emergency condition. However, I am of the firm opinion that the act would be approved regardless of the national emergency." " I am glad of the decision ", Senator Norris asserted. " because It win convince everybody. Including the Supreme Court, that we are trying to save the country." There is no question that the decision deslt dissenting Republi- can* a paraljrzlng blow. That is particularly truo of the small coterie of ultrapartlsnn torles. such os Senator Robtnson of In- diana. Senator Vandenbero, of Michigan, Senator " Hell-Roaring Dick " Dickinson, of Iowa, and Pennsylvania's Senator. David Reed. It ws* ironic that at the very time that Chief JiirMce Hui;hes wa* reading the majority's momentou* decision upholding a cru- cial emergency act the Republican professional " viev;ere-wlth- alarm " were holding forth loudly in the Senate less than 100 yards away denouncing such legislation. The significance of that picture was not lost on administration and progressive strategist*. (From the New York Sun, Jan. 9, 1934] Court Dscuion Blow to Fors or Roosevelt — Upholding or Mora- torium Crushes R«\olt Against Recovbit Program — Ruling AT Crucial Moment — Republicans and Btxn Democrats Had Bebn Dbawutc Links for Was in Comorsss By Phelps Adam* The threat of an Immediate congressional revolt agaln-tt the President's recovery program wa* crushed emphatically here today as the.Members of Ixith Houses began to grasp the full significance of the United States Supreme Court's upholding the constitution- ality of tha Minnesota mortgage moratorium law and reaffirming 1934 CONGRESSIONAL RECORD— HOUSE 381 the doctrine of John Marshall that the Constitution Is designed for adaptation to changing conditions — a decision which accorded both stability and legal respectability to the new deal for the first time. At almost every step of its progress through the legislative ma- chine, the constitutionality of the President's plan has been chal- lenged; and while that plan will continue to face numerous attacks on other grounds, the greatest danger that confronted it has been safely passed in the opinion of observers here. The decision of the Court came at the precise moment when the Republican minority was undertaking to launch a concerted at- tack against the recovery program and when disgruntled elements within the Democratic ranks were coalescing into opposition groups. Every agency of the emergency administrations which have been superimposed upon the normal governmental structure was threatened with Investigation designed to unearth some possible scandal that might help to turn the tide of public sentiment definitely against the huge sp>ending program that is contemplated. ONLT FLintRIES EXPECTED The Investigations will presumably go on, but. with the Supreme Court apparently alined with the President behind the new eco- nomic experlm^t, any disclosures which may result will not give rise, it is believed, to more than a passing flurry of excitement. [Prom the New York Herald Tribune, Jan. 10, 1934J ToDAT AND Tomorrow By Walter Llppmann THE VOICE OP THE SUPREME COURT Prom the opinion of the Supreme Court on the Minnesota mora- torium it Is possible to obtain a fairly clear Idea of the principle by which the Court Is likely to Judge the great mass of new legis- lation recently enacted. The case before the Judges turned on whether a statute of Minnesota to relieve mortgagors was con- trary to the provisions in the Federal Constitution against the Impairment of contracts. The details of the statute, of the particular case, and of the argument from precedent we may leave to the lawyers. Our con- cern is with the general principles which were Invoked by Chief Justice Hughes In the majority opinion holding the Minnesota statute constitutional. For presumably his statement of princi- ples in this case discloses what will be the mind of the majority In considering the body of the new legislation. • •••••• The basic principle is that the power exists in American Govern- ment to protect •• the vital Interests of the people." " We must never forget ". says the Chief Justice, quoting Marshall, " that It Is a Constitution we are expounding • • • a Constitu- tion Intended to endure for ages to come, and consequently to be adapted to the various crises of human affairs." The Legis- lature and the Supreme Court of Minnesota had declared that an emergency existed which threatened many of the people with " the loss of homes and lands which furnish those In possession the necessary shelter and means of subsistence." The Chief Jus- tice finds that the Minnesota estimate of the facts of the situa- tion " cannot be regarded as a subterfuge or as lacking in adequate basis " and that It is " beyond cavil " that there were conditions in Minnesota " urgently demanding relief." In other words, this law to postpone the redemption of mortgages and pre- vent foreclosure was honest. It responded to a true estimate of the facts. It was not a sly device for enabling debtors to cheat their creditors. Thus it transpires that the Court holds that extraordinary legis- lation may be Justified provided it Is clear that It deals with a real public need. Apparently the Court will Insist upon being convinced that the extraordinary laws are what they profess to be— measures to protect the public Interest under extraordinary cir- cumstances. A layman reading this opinion must, I think, con- clude that the Court will ln*l*t upon evidence that the new laws do not ma*k ulterior purposes; that under the guise of protecting " the vital interest* of the i>eople " In an emergency they are not permanent alterations In established obligation* and In the estab- lished limitations of government power. The Court does not say thst * legislature may do what it like* on the plea that there 1* an emergency. It *ay* that a legUlature may do what I* neceesary, but what It doe* must be done sincerely, candidly, and with plain and epeclAo relation to the actual eltuatlon. • •••••• In recognizing that power exist* to deal with the emergency the Court, furthermore, lay* down the rule that extraordinary leglelatlon mu*t be " temporary in operation • • • (and) lim- ited to the exigency which called «it forth." A leglalature, for exampie, may relieve debtor* In a crl*l* by giving them a mora- torium, but It cannot cancel their debt* for all time to come. This statute run* xintll May 1, 1938. "The operation of the stat- ute ", says the Court, " could not validly outlast the emergency or be so extended a* virtually to de*troy the contract*." Thl* appear* to be quite In line with other decl*lon* In recent years which draw a rather sharp line between temporary and permanent legislation. Toward temporary laws to meet a crisis the Court Is very liberal— It recognizes that the power exUte to do any reasonable thing to meet a crisis, be it war, or earthquake and flood and fire, or an economic convulsion. But law* which are to be permanent It quite eridentljr tntende to eerutlBlae carefully and to Judge by much stricter standards of oonstltutlonal powers and rights. Although the Minnesota decision Is by a narrow majority of 5 to 4, few reasonable people have ever doubted that the Court would uphold emergency legl^atlon that was patently sincere. It would be a strange constitution which prevented a le:jlala- ture from using its best Judgment to protect Its people during a great calamity, which bound It so that in the theoretical in- terest of the creditor, it could not act to prevent a disaster which would overwhelm creditor and debtor alike. But at the same time this decision by the so-called " liberals " of the Court makes It perfectly clear that permanent changes in American Inatltutlona cannot be wrought by subterfuges, by exploiting the emergency for ends which, however good iu themaelves, are not part of the emergency. This is the genuine liberal doctrine. It contemplates a gov- ernment of powers adapted, as Marshall said, to the vaxloua crises of human affairs. But It contemplates also a govenunent in which permanent changes in institutions must l>e made only by the considered action of the people, by the people and their representatives when the Issues are squarely presented, when they have had the opportunity to know what they are doing, when they are not confused by the pressure of an immediate crisis and are under no compulsion to assent to what they do not really believe In because they are frightened by a great but temporary danger. A constitution which Is fleklble enough to enable governments to deal with a crisis and yet strong enough to withstand tempta- tion to scrap essential parts of it in momenta of excitement is likely to weather many storms. The Constitution which the Chief Justice has once more expounded is the Constitution which the great mass of the people have believed in. [From the New York Evening Post. Jan. 10, 1934] Human Rights Win Over Propertt Rights Nine men sit on the Supreme Court bench at Washington. Before the eyes of observers they break Into two groups. Five go to one side, and their leader makes a long, grave statement. The remaining four sit and stare doubtfully. One utters m protest. It is done. The American revolution of the last 2 years reaches the Supreme Court of the United States. In the highest court of the land It Is decided that human rights take precedent over contract rights. A new day of freedom for America. The Minnesota mortgage decision Is probably the most Important since the Dred Scott case. It Is decided that when contract rights, hitherto sacrosanct, come Into conflict with the common good in a time of economic emergency, the contract rights can be modified by Government. Minnesota adopted a law last year giving home owners 2 years extra In which to redeem property foreclosed for nonpayment of mortgage. A home owner, whose actual mortgage contract allowed only 1 year for redemption, availed himself of the law. The mortgagee sued on the ground that the law Impaired the obligation of contracts and was thus a violation of constitutional guaranty. The Supreme Court, through Chief Justice Hughes, declared " the question is no longer merely that of one party to a contract as against another, but the use of reasonable mean* to safeguard the economic structure upon which the good of all depends." Contract righu, hitherto used as a device for slaughtering all forms of progressive social legislation, are stiddenly pushed to the back. The Nation, and the States, have a right to work for the com- mon welfare In a time of economic strees. Mr. Hughes' basic argument Is that back of sll contracts lies the reserved power of the 8UU to make Uws which, by strengthening the SUte, and Improvlnf the general condition in a time of stress, strsngthens all oontracU, regardlees of the effect on any partlctUftr contract. The decision does not destroy contract rights. It recognizee contract rights, by holding that the action of MlnneeoU gave adeqiuu protection to the contracting parties, and made their position s&ongsr. . ^ The qtieetlon m to whet oonstltuus »n emergency remelas unsettled. But It U enough thst general economic distress is reoognlaed as an emergency eqtial to flood or war or flre. It U enough that htiman htinger and need receive legal recognition. It Is enough that a decUlon has been rendered which must. If logically exUnded, put the whole mass of new deal Inls- latlon, from NJtJi, down, on a sound basU. The Supreme Court has bound Itself, and the lower eourU ae well, to consider every particle of new deal legUlation In the light of the depression. It has bound Itself to weigh the terms of every bond against the factor* of hunger and need. The eenUnce rings clear: "The oconomlc inUresU of the SUU may Justify the exercise of IU continuing and dominant protec- tive power, notwithstanding interference with contracu • * *." We are free of a great danger. Legalism wUl not tie our hands a* we move forward to a better America. The Conetltutton ie protecting the country, not tying It band azkd foot. AOA rnMnPF.S.cjTnNAT. T^FHORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 383 382 CONGRESSIONAL RECORD— HOUSE 1*- .. be tainlog Ibe govei li- ce n- Constltutl< in. Ibe la|er It. on Van ives. Hug] kes the sane makng he 9ne er of unler neqes- 48 es to (Ttom tb« BrooUyit Dally ■i«l«. <'•&• 10> ^^**\ , The StrrmMMM Cottkt SrcAjcs Thoae who anticipate approval of the emergency natlmial corerr meaaure* by the court of last reaort have reaaon to heartened by the 5-to-4 decision of the Supreme Court iUBtal" the lilnne«ota mortgage moratorium law, though technically ruling bears only on State rights— the freedom of a SUte g'^ ment to meet an emergency without legallsUc hampering. " No State shall pass any law Impairing the obligation of tract* ". is the specific language of the United States Constlti article I. section 10. This was first JudlclaUy annvilled by sustaining of the New York emergency rent law. So the decision does not mxdte a precedent; It follows a precedent. A court Is no wiser or unwlser than the Judges who compose Here we have Justices Brandels. Cardoza, Stone, and Roberta one side of a great quesUon as liberals, and we have Justices ' Devanter. McReynolds. Butler, and Sutherland as conaervatlM es on the other side of the same question, and Chief Justice Hu~ — as the balance of power, swinging victory to the side of liberals. Truly, the law Is not an exact science. On the line-up we should have one man. Charles Evans Hughes, valid or Invalid the cognate emergency powers exercised by Rooaevelt administration under existing legislation. The question what conatltutes an emergency seems to be for ffpai decision not by the State but by the Supreme Court u the reasoning of Chief Justice Hughes, who writes the opinion the majority. Yet the initial determination of this quesUon roust be made by the State, and long and costly litigation may be i aary to upset It. even if the emergency is fictitious. We have States. Most of them are borrowing States, with legislatv strongly Inclined to aid borrowers. Heretofore It has been safe lend to persons within the Jurisdiction of these States, whatever happened a contract could not be impaired. Will it be safe? Only time can give the answer. The theory of the four dissenting Justices, voiced by the land opinion, la that the language of the Constitution cannot made flexible, and Justice Sutherland quotes the expression of court m the Civil War MlUlgan case: " No doctrine Involving - pernicious conaequencee was ever Invented by the wit of man that any of the Constitution's provisions can be siiapended -" any of the great exigencies of Government." As between the two views, we think the Intelligent opinion nonlegalistlc Americans Is as sharply divided as is the Supr«me Court. Certainly many thinkers will hold that If the terms of ^*-- organic law are to be modified or reversed a convention, and Justice Hughes, should produce the change. Yet the effect of notable decision Is to uphold a State In Its effort to mitigate consequences of a great depression which has created new pnce dents in all governments. (Prom the New York Sim. Jan. 9, 1934] Impaiakd Contracts By a vote of 5 to 4 the Supreme Court of the United States has decided that the constitutional declaration that State shall pass a law hnpalring the obligations of contracti subject to reasorvable modification by State legislatures. In words of Chief Justice Hughes. " the economic Interests of State may Jvistlfy the exercise of Its continuing and protective power, notwithstanding Interference with contracts The Chief JiuUce reached back Into McCulloch against Mary' - to quote John Marahall's observation that the Constitution be adapted to the varloiis crUes of human affairs. As the two generations can wltoeas. the Constitution can be " adapt^ by aoMiKliiMnt in the maiuier provided by the framers. beca jse fltlU Sutqer- be the more than d\u^g of ne the aot ihls Lhe no is the the domln int liind she uld ast (Prom the Nev-Tork Tlmea, Jan. 10. 1934] EicncsKCT Laws As as lflnn«ii>U. flren. law knd. ehal- the klch the w1 tlch Sometime* an insignificant litigant with a trifling e««e •bout a Jxidlcial decision of the most far-reaching Importance. Hoolwr aald of the law. Ita care extends to the least as wel tlM grsatast. John and Rosala Blalsdcll. his wife, of could not pay the interest on a mortfsfs which they bad It was forsdoacd. But an appeal was taken under a State grantlDf a 3«ye«r extension of time on mortffafM ot that Upheld by the Suprsms Court of Mlnnesou. this statut* was lenc<^ >n the Supreme Court of the United SUtss, mainly on ground that It was In violation of ths PMloral Constitution, w! Forbids any State to impair the obligations of a contract, By opinion ot a divided cotirt. S to 4, It was hold that th« geney e*ussd by ths deprssstem Justtflsd the MlnnesoU tlon. Thus that particular esse In settled, and in ths pi laid down In the prevailing opinion, written by Chief Hughes. It to believed that a clear Indication Is given what attitude of the Supreme Court will be when various acts of greaa under the recovery program come up for adjudication. Is not forgotten that the declalon ot the Court of Appsala of York upholding the act of the Iceialature which virtually prices for milk was baaed dUtincUy on the emergency dc Prom that declalon an appeal was allowed to the Supreme at Washington. In such aharp divisions of constlttrtlonal Interpretation as pear in the decision read toy Chief JusUce Hughes, and the written by llr Justice Sutherland, It Is hard for the laymai i grasp all the fine distinctions that are made. Both Judges that an emergency creates no new power of government. It leg Ha- prlxtel 7lss Justice ths Oon- It h Covrt Rvvtno-^ ArrtovAL or MotAToaiuM Act Viswko as BasiMa Task or PtossAi. OaotTT Washswotow, January 9 -The belief that the Supreme Court's validation of Minncsotu • mortga«e uiorat4;rtam law mi^ht lighten the Federal taAk nf rennanclng i^rui and home ind'>bti;dues» was expressed today by Far: a Credit Administration and home Owners' Loan Corporation onclals. Ths Court's decision uphsld Stats legislation extending the tlms for redemption of property fureclottcU tur nonpayment ot mortgage Indebtedness and containing other provlAions to eaM the debtor's burdsn. Officials said today almost 30 States had enacted legislation which followed similar lines and that many legislatures meeting this year probably would pass such laws now that the Mlnneiota statute had been declared coi\stitutloiuk.l. Some laws already passed have been held unconstltutiouul by State courts. BKNKrrr bxen One of the principal benefits to the work of the Home Loan and Parm Credit Admin lutratlons, officials said, was that an extension of the time for redemption would nllow In many Instances a sufficient period for a Federal loan on the property or a scaling 1934 CONGRESSIONAL RECORD— HOUSE 383 down of the indebtedness If its present value is Insufficient to cover the amount due. Difficulty that the two organizations have had in getting their bonds accepted by creditors is expected to be dissipated If Congress guarantees the principal as well as the Interest on the securities. President Roosevelt Ls to send a request for such legislation to Congress tomorrow. Meanwhile, both Democrats and Republicans, whether liberal or conservative, were studying the broad principles laid down by the Court in holding the Minnesota statute constitutional. XAIUnDT FKAISES RTTLINO Speaker Rainxt praised the decision and Chairman Jonch, of the House Agricultural Committee, said it was far-reaching and would prevent mortgage holders from taking advantage of an emergency to deprive people of their homes. Administration supporters, generally, took the attitude that the Minnesota case forecast decisions upholding the National Indus- trial Recovery Act, the farm adjustment measure, and other emer- gency legislation backed by the President. The four dissenting Judges, In an opinion by Jtistice Suther- land, took the view the Minnesota law Impaired the sanctity of contracts. The majority, through Chief Justice Hughes, found that there was a situation In Minnesota which demanded relief if the State had power to give It. and that the State possessed such author- ity even If It meant that mortgage holders were denied for a time the foreclosure rights laid down In the contracts made with their debtors. The Chief Justice said the Minnesota statute should be sus- tained as a law for the protection of a basic interest of society. CHANGED ATTTrUDE SEEN Only 3 years ago the Chief Justice was assailed in the Senate as a man who thought more of the rights of property than he did the rights of the Individual. The occasion was his nomination to succeed the late William Howard Taft as Chief Justice. Hughes was confirmed after Senate progressives spent several days In lambasting him. He surprised them and the conservatives, too, at the fall term of court by siding with the liberal element to uphold Indiana's chain-store tax. He left the conservatives also In the California syndicalism case, the Minnesota newspaper gag law, and a series of others, although he has sided with the conservatives now and then, particularly with regard to tax legislation. X [Prom the Washington Herald] Congress Wins Added Powers Under Verdict — Sitpheme Court Decision Gives Sweeping AirrHORiTT to Act When Facing an Emergency Armed with a decision of the Supreme Court that laws may be enforced when made In behalf of all the people In times of emer- gency, the Roosevelt recovery program Is on sure ground. This decision was handed down Monday on the matter of a mortgage moratorium law passed In Minnesota. Following is the second of two articles dealing with the significance of the decision: You n:ay view with alarm the decision of the Supreme Court that n law in behalf of the general welfare may outweigh even the wording of a clause of the Constitution as to your own welfare. And Justifiably so, for. henceforth, the responsibility of deter- mining the general welfare lies not within the Constitution but within the discretion of Congress. True, nobody conceives of a law providing that your hams may be seized by the sheriff or your goods confiscated or your con- tracts Interfered with recklessly and no recompense provided. But that's only because we all have faith in the good sense of our lawmakers and the belief that they will not go that far. Por by Its decision of Monday the Supreme Court has restated an opinion of Chief Justice Marshall of more than a hundred years ago, that Congress may act for the general good, and has added to his opinion the significant remark that the declaration by Congress of an emergency liberates that body to act to ths best tnterents of all even at the loss of one or any part of ths whole of the citizenry. The rigid words of ths Constitution, ths Court now holds, can* not be interpreted to Interfere with what ths Stats concslvss to bs Its protsctivs powsr ovsr its citlxsns. And tbsrs's ths rub, sKTOfro TMi rowcR or covwt Por now ths action of ths Stats as a protectlvs powsr In ths emergency akin to war, lies beyrud the power of the Supreme Court. A law may bs passed that is. In the opinion of ths Court, unwiss or even unfair. But if It is proclaimed on a basis of recognition of national emergency and a threat to the welfare of the whole people it sticks. Congress is bound only by its own discretion on matters relating to the emergency and Its bearing on general welfare. And nowhere In the Constitution can you find words to sup- port that. And that Is what plagues many a sincere believer that his rlghU have been lost and his constitutional guaranties removed by Monday's decision. Among these Is Justice Sutherland, of the Supreme Court, who wrote a dissenting opinion, to which three other justices adhered. (From the Washington Post, Jan. 10. 1934) Thb avrmatm Coinrr Dbczsiom The average citizen, confronted with the wealth of logic and precedent found In both opinions on the Minnesota mcrtuge moratorium case, will probably form his own Judgment by asking a simple question : What would have .happened had the Supreme Court decided 5 to 4 against the constitutionality of this law? The answer to that question is likely to bs disconcerting to all. and they must be numerous, who feel that the dUsenting i^inlon of Mr. Justice Sutherland carries more pure legal conviction than the majority opinion as expressed by Chief Justice Hughes. An adverse opinion on this Minnesota case would have had repercus- sions tar beyond the confines of that State and far deeper In character than the particular law In issue. The legality of large ports of the recovery program, based ujxjn the sweeping emer- gency powers conferred by Congress on the President, would have been immediately called Into question. As the situation rests, that program is now strongly fortified to meet Its next test of constitutionality. In other words, the general reaction to this hlstortc decision Is likely to be that it was foreordained by clrcTimstances. This feeling will be strengthened by the significant emphasis of the majority opinion upon the temporary and conditional character of the legislation which has been sustained. It is not stated that the Minnesota moratorium law would have been found uncon- stitutional if its application were more permanent and less rea- sonable, but that is the implication. To a pronounced extent it is not the constitutionality so much as the rationality of the legislation which Is defended by the majority opinion. Because of this there is a suggestion of inconsistency in the conclusion that the Court was not concerned with the wisdom or unwisdom, as a matter of policy, of the legislation at issue. The conciu'- rence of the minority opinion with this conclusion Is more con' vincing than Its assertion by the majority. The decision may well both augment and diminish the prestige of that august body which has been America's most notable con- tribution of the mechanism of constitutional government. Those with legal training will be apt to feel that the Supreme Court has swung Its emphasis to the opportunist side In a case where the issue of constitutionality was nicely balanced. Those who form simpler Judgments will probably conclude that the Court is a very human body which took the most practical way out of a very thorny situation. There wUl be many comments on an- other 5-to-4 decision. And those comments will hit fairly near the heart of the difficulty. There will, of course, be no lessening of the high respect In which the Justices of the Supreme Court are held both indi- vidually and collectively. Even the most cursory reading of both the majority and minority opinions in the Minnesota case reveals the earnestneBs, the Integrity, and the scholarship behind both of these opposing viewpoints. But the situation serves to em- phasize that these vlewp>olnts are literally opinions — not oracu- lar Judgments. At a time when the standing of all Institutions is challenged by the flux of circumstance, that of the Supreme Court becomes more anomalous Just because It Is apt to be regarded as infallible. But when a rigid Constitution comes into direct opposition with an Inflexible economic situation, it Ls not difficult to predict which of the two wUl yield. The merit of the legal mind lies in Its ability to find precedents to show that it is constitutional for rigidity to become temporarily malleable. [Prom the Washington Bvenlng Star. Jan. 10, 1984] A FAa-RsAcawo Dscibion The Supreme Court of the United States has handed down an opinion of great signflcance and far-reaching effect In the case relating to the Minnesota law establishing a moratortum on fore- closures of mortgages. Involved In ths cass, which ehsllengsd ths constitutionality of ths Stats law In ths light of ths prohibition In ths Constitution against Impairment of contracts, was ths question of ths protection of a basic Interest of soclsty, a pro- tection mads necessary by ths economic situation anslns In ths country. The court, In a decision l^anded down by Chief Jtistlos Chsrlss Bvans Mughss and eoneurrsd In by four othsr msmbsrs of ths Court, uphsld ths yslUltty of ths MinnfsoU law. Ths dselslott of ths Court in this omw, involving a SUts law growing ottt of ths seooomlo MasrfVDoy, m»r M • forsntnasr at othsrt. Zndssd. it has bssn hsllsd as ths first victory in tbs Isgal bftttls which hss bssn gsthsrlng ovsr ths validity and eon- siTtutUmality of many of ths rsoovsnr aeu of tiM adn»lfilstf»- tlon. Ths klnnssoU law was uphsld. It Is trus. by a narrow margin. Ths Court dlvldsd ft to 4, lu dseUloo« bowsfsr. U nens ths lass binding. Ths rsoovsry Uws passsd by tbs Oongrsas at ths bshsst of ths administration havs bssn ehallsngsd In various quarters on ths ground of unconstitutionality. It Is quits tnis that the MlnnesoU law Is a SUU snaetmsnt, llks tbs Nsw York SUts mUk law, ths validity of which ths Suprsms Court Is sxpscted to psss upon also at an sarly dats. But thsss SUU laws, llks the New York rent laws enacted soms ysars ago, which were upheld by the Suprsms Court, ars based upon the existence of an emergency and are Umporary In character. The seriousness of the conflict between thoss who hold that an emergency, threatening the public wrtfars, warranU the exer- clss of power by Government and tbs SUU, and thoss who would bsw to ths narrow llns constitutional InterprsUtlon. is reoognlasd. 9A1 CONGRESSIONi X, RECORD— HOUSE January 10 tQ^A rnMnPTT.stSTnMAT, pwrnpn wnTTQi? grasp All the tine distinctions that iu-« mad«. Both judgM that an emergency creates no new power of goTernxnent. It of the time for redemption would nllow In many Instances a sufficient period for a Federal loan on the property or a scaling other justices adhered. I JIMW to UM lUUTVW uum ir^m»«m»wi«n niai *uiw>|rs«« I I l! SSI CONGRESSIONi J. RECORD— HOUSE January 10 by the the not It is partlctUaily reeognifd tn the dlaeentlng opinion o< the Co art written by Associate Justice Sutherland and concurred in ^*^ three of his colleagues. The view of these dlaMnt«r» from opinion of the majority of the Court Is sxKCinctly espTMsed in declaration that " If the provisions of the ConeUtutkm be ttpheld when they pinch as well as when they comfort, they iiay M well be abandoned." The prohibition against the Impairment of eontracts In the OoasUtution u contained in section 10 of articto 1,-whleh sitys " No State shall enter into any treaty, alUaaoe. or ooaSederat on; grant let.ere of marque s/id reprisal; coin money: emit bUli of credit: n&ke anything bu'' gold and slWer coin a tender in pay- ment of detfU: paas any bill of attainder, ex post facto aw, or Uw impairing the obligation of eontraeU, or graot any tlUi of nobUlty." The Court held that an emergency existed In Mlnneeo»a wlOeh furnished a proper occasion for the exercise of the received power of the SiaU to protect the vital Intereete ot the cnn munlty. That reserve power of the State Is safeguarded In the tenth amendoMnt to the CoosUtuUon. whleh declares: " The powers not delegated to the United SUtes by the Constltui Ion. nor prohibited by It to the autes. are reeerved to the St^ttea. reapeetlvely. or to the people." The Court further held that the Minnerfrta law did not contravene the Constitution since it was of a character appropriate to an emergency and was granted v pon reasonable conditions. The period of redemption for the mort- gagee laid down, the Court held, seemed to be not unreasoni ble, and the legislation which Is temporary In character. Is llmltefi to the exigency which called it forth. (nom the Chicago Dally News. Jan. 9. 1934] KMMmaaicy Is Stxxbsed bt Sttpkkmx Coxtkt — Wxrrcx Ponrrs That PzxMAivxifT New Dxal Mat Not bx Backxs By David Lawrence Washimwton, D.C. January 9. — President Rooeevelt's " new may be Justified constitutionally as an emergency. But effort to maJce It permanent, as advocated by the President his recent message, will nin counter to the Supreme Court of United States. This trend of judicial opinion may be Inferred from the decision of the Supreme Court of the United States In susta the Minnesota mortgage law. Nobody knows, of course, what the Supreme Court will say any future ca.se. as each stands on its own merits and its set of facts, but official Wa&hington has been waiting for se months for a hint as to how the Supreme Court Justices divide on some of the major questions ol constitutional Involved in the new deal. While the Minnesota case involves the power of a State than any Federal law. the principles underlying the decision Just the same as if the National Industrial Recovery Act had under consideration. LAW HAD TTMK ISMIT The Minnesota law provided that the State could prevent dkwurea by requiring the holder of the mortgage to accept a rental value or Interest charge until a specific date In 1934. tttere been no date fixed, the law would have been regarded piece of permanent legialation. This may be assumed from tact that the majority opinion of the Supreme Court •peclal point concerning the limited character of the leglalati^ But it is significant that the Supreme Court did say that a could pass a law which frankly Impaired a contract and that Is not a violation of the Federal Constitution, which declares no State shall make a law impairing the obligations of a con The emergency produced by the bank holiday and the tepreeslon a-as described at length by the Supreme Court as fytng the State of Minnesota In postponing foreclosure act Ttae minortty of the Supreme Court quoted from previous to Justlty the assertion that economic distress may be severe Chat It happens frequently in the life of the Nation and contracts arc meant to be carried out and not Interfered wit|i State lava. ■njoHBS, Boaxrrs, innfxsT. It Is tatereatlng to note that the Supreme Court, tn S to 4. revealed Chief Justice Hughes and Justice Owen erts as concurring with the so-called " UberaU " — namely Brandels. Cardoao, and Stone — while the minority conslstefl Justices SutherlarKl. Van Devanter. McReynolds, and Butler If the Chief Justice or Mr. Roberts should sfwUig to the sMe. we may get declslona holding uneonatltotloBal some ol new-deal legislation. Every single pleee of new-deal legislation baa In its a declaration by Congress that a national emergency exlstf, tt may be taken for granted that for the time being the Court wlU iq>bold any statute Which la baaed on the The Supreme CXmrt will alao reserve the right to Inqiilre the facta and clrcumstiuioeB to determine irttethar the Is real or whether It Is simply an excuse for the enaetmoft permanent legislation. A declaration by Oongreas that an gancy udsts does not always mean that the courts will agree the Out dial" any In the h.test iilng ai>out own I'eral wpuld law rajther are >een i ore- fair Had las a the maAe a xn. iltate this that tract. econ( nnlc JV«ti- ons. opii^ions but It hat by divl ding lob- Jutqtlces of 4ther the preamble .so Suptvme emergency. Into em«rgBfncy at with IFtom the Chicago DaUy Neva. imn. M, 19M] Rxaan-x Powibs or OovssmcxanB Speculation concerning the logical Implications of Judicial ttecl- Is usually ui4>rofltable. Neverthelees, many peraons dqoht- lem Ngard the United States Supreme Court's findings In the Minnesota morttraee-moratorlurn rrvc as distinctly relevant to fundamental constitutional issues raised by the new deal recovery program. Some believe that the decision foreshadows the Court s approval of even the most radical compulsory features of the N11.A., the AJi.A.. and other emcrirency establishments. Others point to the fact that four of the justices vHrorously dissented from the poal- tlon taken by the majority. Five-to-four decisions in important eases are not satufactory. and are not deemed concltislve. Any novel point, and mHtcrlal distinction, may cause one or more of the majority group to change their views. The essence of the majority decision In the Minnesota case Is, briefly, that, although the Federal Constitution does not provide for so-called " emergency powers ", it does contemplate the exer- cise. In emergenclei, of powers reserved to the government of a State, If such exercise I* necessary to the safety and welfare of the commiuilty. The Minnesota mortgage- moratorium law Is sus- tained, therefore, on the ground that It constituted " a limited and temporary interposition with respect to the enforcement of contracts." A Hood or an earthquake, says Chief Jiistlce Hughes, certainly would have warranted a statutory moratorium upon mortgages, and a prolonged economic depression may demand similar Interference with contract rights. The majority opinion makes It clear that no specific grant of power to the Government and no express limitation upon power may be set aside or changed by Judicial construction. On the other hand, where constitutional grants or limitations of power are set forth In general terms, the courts are authorlzeu to " fill in the details," In the light of facts and conditions, by reasonable Interpretation. And the majority of the Court holds It not unrea- sonable to affirm that a serious economic crisis is comparable to a physical disaster in the sense that it calls for the use of reserved powers — of "continuing and dominant powers." The inference is clear that Congress and the Executive may not alter the governmental system of the Republic by destroying guar- anteed contract or property rights of citizens under the pretext of meeting an emergency, but that, like the States, the Federal Gov- ernment may exercise, In authentic crises, reserved powers In a limited way and for a limited time. Whether a Government will- fully stretches or abuses Us reserved powers, or uses them arbi- trarily by continuing to apply them after the emergency has ceased to exist are questions for the Judiciaiy to determine. [From the St. Paul Pioneer Press, Jan. 9. 1934] High Court Upholds Mortg.agi: MoRATORruM — Places State's Win-r.^RE Above PxrvATX Rights — Epochal Opi>.-ion Forecasts Unprecedented Lieeealitt in Rvlings on Government Emer- gency Acts — United States Bench Votes 5 to 4 ln Minnesota Casx By J. R. Wiggins Washington. January 8. — In an epochal opinion setting the economic good of the State over the private-contract rights of the Individual and forecasting interpretations of unprecedented liber- ality on the constitutionality of other emergency powers of the Government, the United States Supreme Court upheld the Minne- sota moratorium law today. PETXHSON HAILS COURTS DECISION Washiwotom, January 8. — The Sup>reme Court's decision uphold- ing the Minnesota mortgage moratorium law was interpreted by Attorney General Harry H. Peterson, of Minnesota, as a constitu- tional vindication of emergency legislation enacted by the States and the Federal Government, including the National Industry Recovery Act. Peterson hailed the decision as " a victory for the people of Minnesota that will enable many farmers and city dwellers to hold on to their homes until good times return." *' I am greatly pleased with the decision ". he said. " I consider It will enable the State of Minnesota, as well as the many other States with similar laws, to accomplish a gn&t deal for the good of their pec pie. •• It will also enable the Federal Government to carry on under Its recovery legislation without fear of an adverse decision as to the constitutionality of the N.R.A. " The majority opinion, as read by Chief Justice Hughes, was not only a sound statement of th? legal phases Involved, but was statesmanlike in that it Interpreted the Constitution as a living document that must be adaptf^d to current conditions. " I believe the respite afforded homeowners by such emergency legialation will give them a chance to refinance their obligations through the Farm Credit and Home Loan Corporations and. con- sequently, will save thotisands of homes from foreclosure." Wisconsin. New York, and Pennsylvania are among other States having mortgage relief laws similar to the Minnesota statute. Henry Epstein, solicitor general of New York, viewed the decision as a vindication of all such legislation. Including that of New York and Pennsylvania, which he described as " much more drastic " than the Minnesota law. TXrCMPH OF HUMAN XICKTS, OLSON BATS The decision of the United States Supreme Court upholding Minnesota's mortgage moratorium law represents a triumph of human rights over property rights, Governor Olson asserted Mon- day night. " The decision represents more than a triumph of the police power clause of the Constitution over the due process of law and obligation of contract clauses ", he said. 1934 CONGRESSIONAL RECORD— HOUSE " It really repreaenta a triumph of human rights over property rUhts. It also indicates that we can change the system under which we live tn any manner we desire and keep within the Con- stitution." The law was drafted In the olBce of Attorney General Harry H. Peterson and passed toy the regular 1933 session of the State legislature. OXAWN BT OBfTBLO The original bill was drawn by Assistant Attorney aeneral Ifathlas N Orfield In collaboration with Attorney General Pnerson. The cone testing the law, which was Instituted in the Hennepin County District Court, finally made Its way to the hiKh Court of the Isnd after District Judge Arthur Selover, of Minneapolis, ruled it unconstitutional and the Minnesota Supreme Court hi-ld It was valid. Jtutlce Royal Stone, of the Minnesota Supreme Court, was the only one dissenting. Instead of filing a brief as friends of the court, the Minnesota attorney general's office appeared as counsel in the case. Attorney General Peterson and William 8. Ervln. assistant attorney general, appeared before the United States Supreme Court early in Novem- ber and argued In behalf of the law, " Otir oAoe Is highly gratified over the high Coma's verdict ", Assistant Attorney General Ervln said when notified of the deci- sion. " We feel this Uw Is beneficial both to the mortgagees and the mortgagors of this State and that the law Is a step In the right direction. " We feel also that it Is not a detriment to the mortgagee, but Is helpful to both parties. It will help tide things over until conditions return to normalcy. The law is working out very satisfactorily. NJJIJl. AITBCTXD " This case further affects some of the principles Involved In the National Indtistrlal Recovery Act. and for that reason also we are highly pleased over the ruling. There are a number of States with similar legislation that will be affected." In stressing the importance and scope of the case. Mr. Krvln pointed out that the United States Law Week, which is one of the leading legal publications of the country, listed the Minnesota moratorium law and the New York milk action as the most Im- portant cases on the United States Supreme Court docket this year. Attorney General Peterson was In Washington Monday to argue the case of Alabama against Minnesota in the matter of prison- made goods. In which 18 other States are affected. DirrxxxNcx in Minnesota and North Dakota Law Citxb BisMABCK. N.Dak., January 8. — There are vital distinctions be- tween the Minnesota moratorium law upheld by the United States Supreme Court today and the North E>akota moratorliun act, ac- cording to C. L. Young, Bismarck, chairman of the State bar board. Young has made a study of the law ol the moratorlxmi for a paper presented before a recent meeting of the State bar associa- tion. The North Dakota moratorltim law was held unconstitutional by the State supreme cotirt to the extent that It was Intended to affect mortgages given prior to approval of the act. but was held constltutloiuil as far as It affects mortgages given after the act took effect. " The Minnesota court In its decision ". Young said, pointed out what It considered a vital distinction between the two stat- utes. " The North Dakota act extends the time of redemption un- conditionally for a period of 2 years from the date of the ap- proval of the act. The Minnesota act provides that one who de- sires to avail himself of the extension provided for must pay the reasonable rental value of the property Involved dtiring the period of extension to the party holding the sheriff's certificate of sale. The court said that this provision, in its opinion, provides com- pensation, so that there is no taking of property without due process of law, although there is in fact some impialrment of the obligation of the mortgage contract." (From the St. Paul Pioneer Press, Jan. 10. 1934] MOXTOAQX MoXATOKItTM RXStTLTS The mortgage moratorium law upheld Monday by the United States Supreme Court was enacted at the regular session of the Minnesota Legislature a year ago in the belief that the dlAcultles of farm and h<»ne owners were principally caused by foreclosure policies of owners ot the underlying mortgages. The legislature accordingly provided that such a debtor may apply to a district court for an additional 2 years of time to redeem his property. If the court is satisfied that the debtor is in good faith and operating the property with reasonable prudence, It can grant the additional time, fixing some Just rental payment azul other terms. It Is this law the Supreme Coiirt has ruled valid and not an unconstitutional Impairment of a contract. Experience under the law has not been quite what was expected. It has been found, for example, that very often the trouble is caused not by the owner of the first mortgage but by some minor Uen holder. Many of the larger creditors, especially the Institu- tional creditors, such as Insurance companies, declare that they have on their books and in tise more liberal moratoriums than that In the law. The mortgatfe owner Is usually more eager than aayooe bIbb to keep a good tarmm on tte fend. SbIb of the erty and eviction la in such casBS the laet raaort. not the first. In a surprising number of caaeB It IB nscBSBBry to porsuade the debtor not to abandon the pmpBf ti. The oourti in applying the movntarlttm law la genenU do about the same thing that a reasonable crBdttor would do, Alttaougli here and there a creditor has been marts ttoe vlatim of potty chiBBlinK, the law on the wbole Imb workBd with rMeonnbte Mtufactorinsss on both sidBs. An amendflM»t taM boon Mif- gvstcd to require a bond to assure the upkeep and maiatenaaoe of ths property durinv the moratorium period »nd It teems » roasonablB one. (Prom the Parmer-Latoor TKB ATTOBWBt Ol •t. PmiI. Mlaa.1 "Lawbb" Two solar plexus blows on methods of exploitation treasuTBd by the capitalist system were landed at Washington. D.C. in a BlnglB week. Credit goes first to the men and women who elected tbem, and then in full measure to Oovemor Olson and particularly to Atty. Oen. Harry H. Peterson, and to the letter's corps of aaslBt- ante — all of whom are active Farmer-Laborltee. Scarcely had telegraph wires quieted from the news that Minnesota's mortgage moratorium lav had been upheld by the United States Supreme Court when another fiash shocked the Nation into attention — the State of Alabama dlsmlaaed its case involTing the sale in this State of goods produced in Alabama prisons. Both cases had been argued before the high Court by Attorney General Peterson. In spite of reactionary poUtldans and orer the noient protest of big-business newspapers. Parmer>LabarltBB of Minnesota are beginning to halt — not yet to root out. but to halt — some vicious features of the economic system used to exploit the com- mon i>eople. In the Interests of simple Justice they even penetrate prison walls holding convicted ene.rnles of society. Farmer-Laborltes! Heads up, eyes front, and shoulders erecti Principles of the Parmer -Labor movement of Minnesota openly and effectively challenge the world-wide, international capitalist system. The fight is on in earnest! (From the Minnetonka Pilot. Mound. Minn.] COWOBEBSICAIV LUWDEXN DEmTDS THS MOBTOAOE MoXATUKiUM ttt AM Opkn Lettsk to Loan Cokpoxationb GxNTLEicxN : After a meeting at the offices of the Beconstmctlon Finance Corporation, attended by you and certain other Govern- ment c^ficlals and representatives of certain insurance companies and financial institutions, you announced to the press that " ths wbole mortgage situation ts being greatly embarrassed and re- tarded by laws that are being passed in different States giving unusual moratorium privUeges." I wish to lodge vigorous protest agatnat this statement. The Federal Government should have given prompt aid to the home owners and farm owners of America. Hod this been done, mora- torium laws would not be necessary. Had the machinery set up by the Federal administration functioned properly and brought swift relief there would be no talk of embarrassment now. I call your attention to the opinion oi Hon. Harry H. PetBraon, Farmer-Labor attorney general of MlnneBOta, who fought this battle of human rights against property rights before the Supreme Court of the United States. Attorney 'General Peterson has wired me as follows: "The Minnesota mortgage moratorium law does not Intecfert with the program of the Federal loaning agencies. It was passed before such agencies were in existence and in the belief that when they came into existence such agencies would provide the necessary money to refinance farm and home mortgages. " The extensions provided for by the Minnesota mortgage mora- torium law were necessary because of the falltue of the Federal Oovemment to act and to save the farms and homes of our people, which the Supreme Court of the United States held is a ' basic interest of society ' until the Federal Oovemment does act. Just as soon as FMeral loaning agencies provide needed money. State extensions will end. "The act by its terms Is not applicable to loans by the United States Government and its agencies. It cannot interfere with Federal loans. " It is pertinent to observe that the Federal Government, true to form, through the Reconstruction Finance Corporation, has taken care of those at the top first— the railroads, banks, and Insurance companies — and then gave postponed attention to those at the bottom, the farm and the home owners, who constitute the moss of the people and really are the Nation. Until the Pederal Government has done as good a Job for the people as it has for big business. Mr. Jones' remarks are not tn order. "The statement made by Mr. Jesse H. Jonaa. chairman of the Reconstruction Finance Corporation, and John H. Pahey. chair- man of the Home Owners' Loan Corporation, ' that the whole mortgage situation is being greyly eaabarrBSsed and retarded ' by State mortgage moratorium laws Is utterly untrtie and is baaed upon either a miaconception of the pnrpases of this law or igno- rance of its provialotu. " It is evident that mortgage moratorium laws arc still needed and desirable. Because of the failure of the Federal Government and its agencies to provide needed money, Missouri. Arkansas. Kentucky. Mississippi, and a score of other States are even now ^Mi ♦^««pi«*i «g the enactment of jBortgefB momtorlum laws to LXXVIII- -20 « r i 1 1 /^/-k"VT/^T»T:iOOT/^XT A T ■n-c^nrwtTi ■LmTTCT? .Tamttapv in 1934 CONGRESSIONAL RECORD— HOUSE 887 ro or uov Speculation oonc«mlng the logical ImpIlcaUona of )udlel«l Is usually unprofitable. Nevertheleae, many pereona ' The decision represents more than a triumph of the police ttecl- I power clause of the Constitution over the (Xue process of law and dqobt- ' obligation of contract clauses ". he said. htLVt on their books and In use more liberal moratoriums than that In the law. The martga«s owiaer U usually more eager than Kentoclcy. Mississippi, ana a seore oc oi^ner ciontemiiiatlng the anactmant of omiws are eren now BBorBtarliini laws to LXXVm- -20 f !l < I t* 386 CONGRESSIONi^L RECORD— HOUSE Oovein protect their farm and home owners until the Federal ment and its agencies do act. The * basic interest of society ' this protection." _^ „ Government officials and Members of Congress especiaUy read the Minnesota mortgage moratorloim law and the S . Court's decision which I placed in the CoNcaiasiowAL Recoao January 10. 1934. The liomes and farms of the American must be protected from destruction at the hands of financial InstltuUons. ne(h(fild receive similar approval for the same reason. CONSrXVATIVIS GKAVX The existence of an emergency may be spread to cover a multl- tude of things, and in this decision is seen probable approva of practices growing out of the National Recovery Adminlstrat on the Agricultural Adjustment Administration, and various ofher features of the new deal. How for the Interpretation of the Constitution might go Is duz- aling students of the Constitution, and there is grave shaklni of heads among those who agree with the minority opinion, read by Justice Sutherland and concurred In by Mlnneaota's represents tlve on the Court, Justice Pierce Butler. STAMPS BtTOmS AS LXBCSAL The decision renewed the grouping of the present Supreme Court as among ' Itbenils " and " conservatives ", so-called. It definitely placed Chief Justice Hughes amcng the liberal grdup regardless of the fact that he was apf>olnted as a judge of (on- servatlve leanings, and his confirmation was opposed by the tllb cral group in the 8urt stood 5 to 4. as it has many times in critical cases. The decision BUiy have a far-resehing eifect. LAW WAS HZU> INVAUD The case originally was brought in Hennepin County Dislkict Oouri, where Judge Arthur L. Selover held the law invalid. | On January 10 appeal the State supreme court reversed the decision. Justice Royal A. Stone alone dissenting. Appeal was taken, and the United States Supreme Court ex- pedited consideration because of the time element involved. The case attracted Nation-wide attenUon because similar laws In other States were involved, to say nothing of the Federal acts under the new deal. The case was argued November 8. Attorney General Harry H. Peterson and Wlilif.m S. Ervln. one of his a.sslsUnts. spoke for the act, which was attacked in argumento by Karl H. Covell and Alfred W. Bowen, Minneapolis attorneys. (Prom the Minneapolis Star, Tuesday, Jan. 9] MoaATOBTOM Decision Pleases IIo-me Owners — Mobtgaob Law Upheld in Supreme Coltit Rclino £ome 4.000 Minnesota home owners today greeted with relief the United States Supreme Court decision upholding constitu- tionality of the Minnesota mortgage moratorium act, passed by the 1933 State legislature to provide extension of the redemp- tion period to May 1, 1935. \7!th about 4,000 such cases pending In the State, approximately 550 such cases have been started in Hennepin County District Coxirt, according to George H. Hemperley, clerk of district court. More than half of the cases already have been heard and relief granted pendln;; the deci.sion handed down late Monday, he said. llr. Peterson said the decision would save thousands of homes from foreclosure throughout the country. George C. Stiles. Minneapolis attorney, who assisted in dra^ng the ori'^lnal bill for consideration by the State legislature and who fought the ca.se along in the district co\irt, said he was " extremely pleased by the decision, which upholds the right of the individual to safeguard his property." [Prom the Minneapolis Star, Jan. 10. 1934) The Mortgage Moratorium Upheld A majority opinion by the United States Supreme Court has upheld the validity of Minnesota's mortgage moratorium act, thus recognizing the emergency that exists among home owners throughout the country and glvin'^ them, by reason of that emergency, a chance to hold their homes in the face of it. In defending the act it might well be asked: If this isn't an emergency, what would be? If this Isn't a time to make some concession to those who have invested their savings into homes of their own, when would be? The Supreme Court's decision Is In accord with the American creed that the home and home owi?^rship should be the last to collapse under economic pressure. When a mr.n and family lose their home their anchor is torn loose from the spot of earth they called their own, their pride in that anchorage is dealt a fatal blov/. the confusion of the depression is worse confounded. This law extends the redemption period to May 1, 1935, when the recovery program should be far enough advanced to save many homes which otherwise would be lost and irrecoverable. It is a humane and human measure, and the Cotirt's decision behind lU teohnlcal phraseology ideutifles it as such. [From the St. Louis County Independent (Hibblng. Minn.)] Minnesota Again Sets Pace The validation by the United States Supreme Court of the mortgage moratorium law enacted by the Minnesota Legislature St its last regular session Is another feather In the h.it of the Farmer-Labor administration under the leadership of Gov. Floyd B. Olson, and will no doubt be the means of giving the farmer and home owner in other States the same relief offe-f-ed by Minnesota. It Is through the leadership of Governor Olson that Minnesota is becoming a byword for those who feel that the eld order must go and that it must be replaced by something that will benefit society. Governor Olson, through the Farmer-Labor Party, is ad- vocating fundamental changes that If proposed a few years back would have caused a great many people to throw up their hands in holy horror and howl socialism, radicalism, bolshcvism. and other terms that were aimed to turn the people's minds against their own beat Interests. Conditions, however, have compelled the people to delve a lit- tle more Into the fundamentals necessary to bring about a change, but a leadership was needed to propose and carry out these changes. That leadership was conferred on Governor Olson by the people of Minnesota, and that the people made no mistake is conclusively proved by the undaunted courage displayed by the State's chief executive in advocating and carrying out fundamental changes that are being adopted by other States. It is this kind of leadership that is placing Minnesota In the forefront, causing this State to be set up as a model by other States in the fight for economic Justice. [From the Omaha Bee-News, Jan. 9, 1934] SETTiiiG Aside of Contracts is Ruled Legal — Supkehe Cotjbt Upholds Minnesota Law Washington. January 8. — The Supreme Court upheld a Minne- sota law Monday in a ruling immediately interpreted In the Cap- ital as auguring well for the wide varie.y of emergency legislation enacted under Presicient Booeevelfs program. 1934 CONGRESSIONAL RECORD— HOUSE 887 Tbe decision upheld the right of a State to suspend contracts i In an emergency, such as was provided by the depression. The law. which the Court held valid, extended the time in which mortgaged property sold under foreclosure might be redeemed. The right of contracts and of the Government to set them aside In an emergency was debated last April and May while several of the bills of the President's emergency program were before Congress. [From the San Francisco Chronicle, Jan. 10, 1934] Farm Decision Not Rule on NJIA., Declares Beck — Consttto- TioNAL Authoritt Sats Coubt Dib Not Pass on Congress POWXB Representative Beck, an acknowledged constitutional authority and a Republican, at the request of the Associated Press, wrote the following view of the significance of the Supreme Court action upholding the emergency Minnesota mortgage moratorium law: (By James M. Bsck, Representative of Pennsylvania and former Solicitor General of the United States) Washinotow, January 9. — The alphabetical excrescences of our already swollen bureaucracy should not take too much encourage- ment from the Supreme Court decision in the recent Minnesota case. In my Judgment It does not necessarily validate the more dis- putable features of the emergency legislation, for the Supreme Court was not considering the powers of Congress under the Con- stitution, but only the power of the Legislature of Minnesota. COURT BULING cited That great Coiu't has repeatedly stated that its opinions mvist be confined to the precise question which it was adjudicating. In this case the question was whether the Federal Constitution prevented the State of Minnesota, under its reserved powers, from suspending the remedial processes of its courts for a limited period In the matter of foreclosing mortgages. As a sovereign State, Minnesota has all legislative power except such as It and other States had delegated to the Federal Govern- ment under the Constitution. The United States Supreme Court has now held, by a bare majority, that the temporary suspension by a State of the right of foreclosure Is not an impairment of a contract within the meaning of the Federal Constitution. [From the San Francisco Chronicle, Jan. 10, 19341 OmciALS See Relief Spxm in Decision — Action Held Forbcast of Favobablx Stand on NH.A. in Legal Txst of Plan Washington, January 9. — The belief that the Supreme Court's validation of Minnesota's mortgage moratorium law might lighten the Federal task of refinancing farm and home indebtedness was expressed today by Farm Credit Administration and Home Owners' Loan Corporation ofBclals. The Coiut's decision upheld State legislation extending the time for redemption of property foreclosed for nonpayment of mortgage indebtedness and containing other provisions to ease the debtors' burden. MORE STATES TO ACT Officials said today almost 20 States had enacted legislation which followed similar lines and that many legislatures meeting this year probably would pass such laws now that the Minnesota statute had been declared constitutional. One of the principal benefits to the work of the Home Loan and Farm Credit Administrations. ofUcials said, was that an extension of the time for redemption would allow, in many instances, a suf- ficient period for a Federal loan on the property or a scallng-down of the indebtedness if its present value is Insufficient to cover the amount due. OUABAMTT TO BX KXTXNDKD Difficulty that the two organizations have had in getting their bonds accepted by creditors Is expected to be dissipated if Congress guarantees the principal as well as the interest on the securities. President Roosevelt Is to send a request for such legislation to Congress tomorrow. Administration supporters generally took the attitude that the Minnesota case forecast deciblons upholding the National Indus- trial Recovery Act, the farm adjustment measure, and other emer- gency legislation backed by the President. DISSENTING OPINION The four dissenting Judges, in an opinion by Justice Sutherland, took the view the Minnesota law impaired the sanctity of contracts. The majority, through Chief Justice Hughes, found that there was a situation in Minnesota which demanded relief If the State had power to give it, and that the State possessed such authority, even if it meant that mortgage holders were denied for b time the foreclosure rights laid down In the contracts made with their debtors. The Chief Justice said the Minnesota statute should be sustained as a law for " the protection of a basic interest of society ." hvohxs oncx assailed Only 3 years ago the Chief Justice was assailed in the Senate as a man who thought more of the rights of property than he did the rights of the individual. The occasion was his nomination to succeed the late William Howard Taft as Chief Justice. Hughes was confirmed sfter Sen- ate progressives lambasted him. He surprised them, and the oonserratlTes, too, by siding with the liberal element to uphold Indiana's ehaln-atore tax. He left the conservatives also in the California syndlcallam case: the Minnesota newspaper gag law: and a series of otkiars. although he has sided with the conservatives now and then, particularty with regard to tax legislation. [From the NatlonI The Supreme Court, as " Mr. Dr,oley " once astutely remarked, follows the election returns. Sometimes. s^uvcf ueiu ku« iKW uiTsua. VB I uukcbca uuuer rresiueni nooeeveiii ■ prc^aui. 4 r 388 CONGRESSIONAL RECORD— HOUSE «ltu«tlon muat be considered. What do you sey to that? " he asJs ed lawyers for the mcrtijage company. „„.^,h "There U no emergency, they replied, '"which wUl augpeid the limitations of the Federal Constitution." They Bald the MT ne«>ta statute covernlng the case was unconstitutional because impaired a contract, deprived the company of property withci due process of law, and did not operate equally upon all. But after more than a months deliberation, the Supreme denied all the mortgage company's contentions and decided the Constitution had not been violated. "Emergency", said Chief Justice Hughes thU Monday, the opinion he had written. " doea not create power, but Mncy may create oc«islon for the exercise of power which That power was the ' reserved power of the State to protect vital InteresfU of the communlty.- Mjn it withdut Court U at reading emsr- exisl B." the (From the Uto^ry Digest] BxmxMM CoTjar Maxb thb N«w Deal Mom S«cu«»— Drcw^iN Upholdino the UmmMOTA Mostcaok MoaaToaroit Law, the Test o» the Roosevelt Pboceam. Is Haiixd as Om or the Imfobtant Of Teaks John Blaisdell and the new deal were both made more last week when the Supreme Court of the United States. dlTldfng 6 to 4. decided that Mr. Blaisdell could have more time to that $3,700 mortgage on his Minneapolis Lome. The decision, holding the Mliwesota mortgage moratorium law and settling flrat case brought since the Inauguration of the new deal hailed throughout the coxmtry as one of the most important " fexteration — or longer. _, .. The specific issue was the constitutionality or the law extending the tln>e for redemption of mortgaged property under foreclonu:-e. But It Involved the far more vital general i ciple whether in emergency the public welfare Ukes precedence over individual rlghu. . .. ,. .». »w "While the case involved the power of a State rather than Federal law " natd D»vld Lawrence, well-known WaahlnTton respondent. " tlie nrtnolples underlying the decision are just same as if the national Industrial iteoovery Aot bad been •• eonsideration _ . . .... The majority opinion, written by Chltf Justice llughee. Justices Iranditls, ■tone. Koberte. end CardoM eoneurrlng Juatleet iMtticrland. Van Devanter, MclUynolda, and Duller ■enttng, " was regarded as tremendously slinlfloant ", said Washington correspondent of the Hew York Times, "and as absolute test of tits Oourt's views on programs of «n emerr nature which Freoident Rooeevelt and his lieutenants might propose." Ths minority opinion was writtsn by Juitlos -••'-" MVhoa* \m ¥itt niiMtinn^' MAiil Thsodora O. Wallsn. Fust MilST sec ire ip- he is it » Mlnnes 3ta a Did piln- uny arts of the country showing the reaction to the S Court's decision: THE worm AND EAST New York Herald Tribune (Republican) : "The first thing to be said of the decision Is that It does attempt to adjudicate be3rond the depression. Applying the i principle to the National Industrial Act there is not the slightest hint of any revolutionflxy approach to the Constitution w^lch might encourage the Tugwell group of advisers In their of establishing a permanently planned order of society dl from Washington." Philadelphia Record (independent) : "The Minneeota mortgage decision ts probably the most portant decision since the Dred Scott case. What It does .. Ilwe America from alavlah subservience to a literal Interpreta ion ed ^as on, lobk' ths the rhe the the far the emergency C prn»ont riwision a clinr Indlnatton that the hluhest rourt m ths land InlPtidn to rix^oBnl/.s thn N It A. and th» rwrovery prouram of ths Prr^ulenl, The atlmlnl^tratlon'i foes, who cloak thvlr antngonum vtiidor the KUias (if a urnnt love for ths CohMtitiition vMll taks no nulaue fruta tUe I4inus«uta moratorium dsoialon." New Orleans Tlmss-Plcnyiins (Demorrstloi i " In a v*ry roal sense this t««t (si- cally incapacitated could obtain an adequate pension. If this would be done they would not be ccnnpelled to get on their knees and ask the would-be charitable agencies for rehef. I say it is an outrage that men and women who are willing to work cannot obtain work l>ecause they are physi- cally incapacitated, or are too old to obtain emplosrment. Again, I say it is not a question whether we are Demo- crats or Republicans. We are here to represent the people and not political parties, and I know if we will do our utmost in representing the people of this country we are bound to bring all of the unfortunates out of the rut, who are now in it because of a depression. [Applause.] Mr. WIOGLESWORTH. Mr. Chairman, I yield 10 min- utes to the gentleman from North Dakota [Mr. Lxmks]. Mr. LEMKE. Mr. Chairman and members of the Com- mittee, X am proud to know that we are getting 6ome non- partisans on both sides of the aisle. I am proud to know that the leaden of neither the Republican nor the Demo- cratic Party represent or speak for all of the members of their party— from now on wc are folni to be citisens flrst and Republicans and Democrats afterward— all pulltuians look alike to us. Prom now on wo are lolng to think nrid work for all of the people of the United States of Amerira, and not only for Republicans or Democrats. May I say to my colleagues from New York, If a fewuf theReprenentaliveN from their State would oomrt up here to the Speaker's di»sk and sign the petition to dlsoharRe the committee and bring the Prasler-Lrmke bill out onto the floor for dUcuaslon and passaue, thut thfn the avrlcultural West would be more in sympathy with the Ideas and suggestions of the Kenilemen from New York. X am now going to discuss, for Just a few minutes, the proposed gng rule. The Constitution vests all leslftlatlve powers In the Congress of the United States. It says that Congress shall make the laws of this Nation. It vests the power of making the laws of this Nation in Congress and in Congress alone. If the Constitution means anything, it means that we will openly, fearlessly, and frankly discuss, debate, and consider the laws that we are about to pass upon. This is especially true when those laws are prepared by a so-called " brain trust " — humorously so called in the same sense, and to the same extent, and for the same reason that the tallest man you ever knew was called " Shorty " and the fattest man you ever knew was called " Slim." I maintain that the Members of Congress have the right to open discussion and debate, and to offer amendments on all of these bills. If we blindly surrender that power to outsiders who are not Members of Congress, then we may as well go home and tell our constituents that we serve no useful purpose here. But if we discuss, debate, and con- sider these laws openly and frankly as representatives of all the people and not as representatives of a party or fac- tion, then and then only shall we be true to the trust im- posed upon us by the Constitution and the founders of the Republic. I am opposed to the gag rule that will be brought up here for adoption at noon tomorrow — the gag rule that will prevent Members from offering amendments or debating the provisions of the independent ofOces appropriation bill. I am especially opposed to that gag rule because it is brought in here now to help continue the crucifixion of the disabled soldiers, the veterans of this great Nation; I am opposed to it because I am satisfied that without that gag rule you will not be able to continue the crucifixion of the veterans of this Nation, and that the great wrong that you have done to the veterans by the adoption of the so-called " Economy Act " will be corrected. ^-^/^■vT/-«'»-»T-innT>~k'KT A 1 TlTTti^/^irn TT/^TTC'17 Tamttat?v in 10Q/I rnMnPTTQQTnMAT PT^rnpn TinTTCF. nai uoii even a DxacK-ana-wnite uiuie couia exisb on. i uiuui. ii> i sAMuvuxjf AVk wu« u<; wtM^v^M^u. 390 CONGRESSIONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORI>-HOUSE 391 « _ a [ P The way we are treating the veterans of this Nation Is & disgrace. We no longer protect the protectors of ths Nation — the men who gave their limbs and their health an d were willing to give their lives for the Nation. We are eve a misusing the veterans' hospitals that the people and tan - payers of this Nation built for the veterans. The doors y party leaders because of the so-called " seniority rights " a id " party alinements." We were elected to bring about a r^ new deal. Mr. BYRNS, Mr. Chairman, will the gentleman yield? Mr. LEMKE. Tes. Mr. BYRNS. The gentleman cays that we are going to pe nonpartisan aU the way through. Does the gentleman spe ik for the entire Membership en the other side of the aisle? Mr. LEMKE. No; I speak only for the Cherokee strip o\er there. (Laughter.] You know that strip is growing. May I say to the Repu 3- Ucans on my extreme left that a cyclone struck you in 1912. and if you, my Democratic friends on the extreme right, io not look out, a tornado will hit you. The people of tlis Nation hJive made up their minds that our slogan in tie future shall be '* Forward ever, backward never." We b re going into a new age, a new civilization. Whether we 19ce it or not, we cannot alter it. Whether we like it or not, we are being pushed forward. Mr. POCHT. Will the gentleman yield? Mr. LEMKE. I yield. Mr. POCHT. I listened, of course, with ffreat pleasure, and was very much impressed with the speech which the gen- tleman has made, but I should like to know whether any attempt has been made to get this bill out, this bonus bill, by the usual process of legislation, by offering a resolution? Has the gentleman done that? I have voted twice on this measure, and I should like to see something done in an active way instead of all this talk. Mr. LEMKE. The petitions to discharge the committees In charge of the Frazler-Lemke bill and the Patman bill are on the Speaker's desk; and if we get 145 signatures, then these bills will come up automatically for discussion and passage. There are about 67 signatures on the petition for the Frazler-Lemke bill, and almost the same number on the Patman bill. Now let us get busy and go up there and sign the petitions. Mr. FOCHT. Why not get up in your place and vote? I have not been able to find It, and I have been here several months now. Why can you not offer a resolution, as I have done many times in the Pennsylvania Legislature, and put them all on record? Why docs not the gentleman do that and do it in the regular way? Why run around behind the desk somewhere and sign a petition? Ths gentleman should wake up. Mr. BOILEAU. Will the gentleman yield? Mr. LEMKE. I yield. Mr. BOILEAU. Is it not a fact that the petition lying on the Clerk's desk is the only regular way in which it can be done, the Committee having refused to bring the bill out? Mr. LEMKE. That is exactly correct. Mr. FOCHT. Does the gentleman mean to say that is not correct parliamentary practice to offer a resolution to dis- charge the committee and take a vote on it? Mr. BOILEAU. That petition is now on the desk, which we are asking the gentleman to sign. Mr. FOCHT. I will sign it as far as that is concerned, but can you not take a vote on the resolution? Mr. BOILEAU. Not until we get 145 signatures. Mr, LEMKE. That is the rule of the House. Some Mem- bers are even talking about changing that rule and making it more difScult. That is part of the system of the gag rule, and, as I understand, some of my Republican friends and Democratic friends attempted to form a coalition and change the required number of signatures from 145 to 218. I should like to see them try it, because I am confident that it cannot be done in this House, unless I misjudge the temper of the Members v;ho compose this House. Mr. FOCHT. Does the gentleman mean to say that this body of men. sent here to represent the sovereign will of the people, cannot get that bill before the House? Mr. LEMKE. They cannot. Mr. FOCHT. I say you are very weak on parliamentary procedure if you adrnit that fact. Mr. LEMKE. I am sorry but the obtaining of 145 signa- tures is the only parliamentary procedure under the rules of the House. Mr. BOILEAU. Will the gentleman yield further? Mr. LEMKE. Certainly. Mr. BOILEAU. I wish the gentleman from Pennsylvania [Mr. FocHTl would tell us how to do it, because many of us are anxious to do it. I do not know how it can be done under the parliamentary rules of this House. Mr. FOCHT. As I understand, you have a requirement that before you offer a resolution, a petition must be signed by at least a hundred Members. I call that rank Democratic gag rule. Mr. BOILEAU. Well, I do not know whether it is gag rule or not. but it is the rule of the House. Mr. FOCHT, There is no other bill in this House as im- portant as that one relating to the relief of the soldiers and their widows. I say the sovereign will of the people can be expressed here, and I will show you a way before long, if you are going to delay by trying to get 200 names to a petition. Mr. BOILEAU. Will the gentleman yield further? Mr. LEMKE. I wish to say to the gentleman from Penn- sylvania that I am very sympathetic with his views; but I do say that under the parliamentary procedure, I know of no other way by which these bills can be brought out, and if the gentleman knows of such a way I am sure many of us wiU be very, very pleased to get the information. Mr. POCHT. I certainly will show you a way. Mr. BOILEAU. Thank you very kindly, Mr, LEMKE. I want to say that I am in whole-hearted accord with the gentleman from Pennsylvania and will work together with him. I will call on the gentleman tonight to have him show us a way. If the Sargeant at Arms does not put us out. We will get together and bring this bill out. The CHAIRMAN. The time of the gentleman from North Dakota [Mr, Luacil has expired. Mr. WIOOLESWORTH. I yield the gentleman 2 addi- tional minutes, Mr, FIESINQER. Will the gentleman yield? Mr, LEMKE. I yield. Mr. FIE8INOER. When the Republican Party was In power In this House, did not the rule require 218 signatures? Mr. LEMKE. It was 218 until there was a deadlock and they could not elect a Speaker, and you good Democrats and a few in the Cherokee strip here changed It to 145. I want to thank you for calling our attention to it. In conclusion permit me to suggest that the time has come when we stop crucifying the veterans of this Nation — when we restore their disability compensation and hos- pitalization. The time has come when we should restore the salaries of the underpaid employees of this Nation — at least those who are getting small salaries, I am not con- cerned about the men with the high salaries. I am con- fident the time is here to reduce the salaries of those who are getting over $10,000. Mr. DUNN. Mr, Chairman, will the gentleman shield? Mr. LEMKE. I yield. Mr. DUNN. Does the gentleman know that the Capitol police receive but $85 a month? Mr. LEMKE. I know that; and I know, too, that the boys who take us up and down in the elevators get about $80. Mr. DUNN. I agree with the gentleman in his attitude. Mr. T-TTTtTTCF If there is a deficit in our revenue, then I again suggest that we suspend the interest on the public debt for 2 or 3 years. [Applause.] That would be far better than to continue oiu: mistreatment of the veterans and the Federal employees. Suspend this interest and pass the Prazier-Lemke bill refinancing the farmers at li/2-percent interest and IV2 -percent principal on the amortization plan, not by issuing tax-exempt, interest-bearing bonds, but by issuing Federal Reserve notes, and pass the Patman bill and pay the soldiers' compensation in cash, not by issuing tax- exempt bonds, but by issuing Ti-easury notes. Then there will be no need to guarantee the principal as well as the in- terest of tax-exempt, interest-bearing bonds in the hands of coupon clippers. Then there will be no deficit, [Applause.] [Here the gavel felL] Mr. WOODRUM, Mr. Chairman, I yield 5 minutes to the gentleman from Arkansas [Mr. Glover]. Mr. GLOVER. Mr. Chairman, I do not expect to make a speech in 5 minutes, but I sought this time to call attention to the progress which has been made by one of the regional agricultural credit corporations in my State, which is lo- cated at Pine Bluff, Ark., in my district, the Sixth Con- gressional District of Arkansas. I received a letter from my good friend, W. A. Ragon. a brother of our former colleague, Hon. Heartsiil Ragon. who has been assistant manager. With this letter he transmits a statement of the work done by this corporation and the results accomplished, I think it will be of interest to tell you how successfully this plan has worked out for agriculture in my State, This one regional corporation at Pine Bluff, serving several counties, made 5.893 loans this last year, amounting to a total of $3,110,527.18. Of these loans, 4,848 have been paid in full, amounting to $2,745,420.08, leaving but L046 loans which have not been collected In full, amounting in money to a total of $365,107.10, and I am informed by Mr. Ragon that most of these loans wUl be coUected. He says they will collect 98 percent of the more than $3,000,000 loaned by this corporation to farmers. The small fanners are the kind of people who have been taken care of largely with this character of loans. My good friend the gentleman from South Carolina. Mr. Fm.MER, a member of the Committee on Agriculture, on which committee I have the honor to serve, has introduced a bill to extend loans of this character for another year. I believe it ought to be done. I was for the bill passed last year providing for the setting up of cooperative loans, but there is a feature in that legislation which I am afraid wlU militate against the man who has to ask for small loaa^. You will remember that in the plan which is entered into with cooperative associations for borrowing, the borrower must subscribe for 6 percent of stock. This is for the pur- pose of preventing losses. For instance, if 60 of us were going to go into a cooperative association for borrowing. each of us would take 5 percent of the stock to guarantee payment of the loans and we would be exceedingly careful about whom we take into this organisation. I am afraid this plan will militate against the small man. Unless this restriction is lightened, the beneficial effects of the legisla- tion will not reach one quarter of the territory which can be served by the organizations which have been formed. Mr. HOEPPEL. Mr. Chairman, will the gentleman yield? Mr. GLOVER, I yield. Mr. HOEPPEL, Will the gentleman kindly inform the House what interest was paid by these poor tenant farmers? Mr. GLOVER. I understand it was 6 percent. Mr. HOEPPEL. And the gentleman recognizes, does he not, that bankers are paying only 2^ percent on money they borrow? Mr. GLOVER. Yes; I recognize that, but I do not have time to enter into a discussion of that question now with only minutes of time allotted to me. Mr. HOEPPEL. Certainly not. Mr. GLOVER. There is a class of farmers who have not been helped by the legislation we have passed, and I feel that provisions should be made In the law to aDow us to help them. Mr. PIERCE. Mr. Chairman, will the gentleman yield? Mr. GLOVER. I yield. Mr. PIERCE. What is the general nature of the bxisiness in the neighborhoods of which he speaks? Mr. GLOVER. Farming. Mr. PIERCE. They are not in the dairying and cattle business? Mr. GLOVER. Yes; both dainring and cattle raising are carried on in this district, as well as general farming Mr. PIERCE. Is it largely a cotton-raising district? Mr. GLOVER. Yes; many of the loans now outstanding are seciffed on cotton which is held and not yet sold. Mr. PIERCE. Precisely. Mr, GLOVER. Mr. Chairman. I challenge anybody to show any organization for the relief of agriculture, or the conduct of any other enterprise, an organization fostered by the Government which can make a better showing than this. Mr. Chairman, in order that the House may have the benefit of this statement, which is particularized. I ask imanimous consent to extend my remarks by having this letter and statement included therein. The CHAIRMAN. Is there objection to the request of the gentleman from Arkansas? There was no objection, The matter referred to follows: Famc Cbsbit ADtCimSTRATIOir. Punc BLxxrr Bsahcr. Rboiomal Ainxcin.TnKAi. CscDrr CoEPOBATtoH or St. Lotnts. Mo.. Pine Bluff. Ark.. December 21. 1933. Congreflsmui D. D. Qvaroi, Malvern. Ark. DBAS Um. Glovxe: WliUe In the office several days ago you re- quested the writer to aend you a current statement of the opera- tions of the organisation for the year of 1933. 907 CONGRESSIONAL RECORD— HOUSE January 10 1QS4 CONGRESSIONAL RECORD— HOUSE 393 future shall be " Forward ever, backward never." We store going into a new age. a new civilization. Whether we 14ce expressed here, and I will show you a way before long, if you are going to delay by trsring to get 200 names to a petition. in full, amounting to $2,746,420.08, leaving but 1^045 loans I tiona oi the organiMUon for the year of 198S. s 392 CONGRESSIONAL Kncloeed to tfateraOTit made up as of the cIo« of buaineM. De cember 15. glTlng deUUed Information from date of organlzatioB to December 15. „, ^ , UDon careful examination of this statement, think you wUl flnJ JJ Balance after transit items are collectol as or Doc 15. 1333 SiS, 737^71 Interest collected to Dec. 15. 1933 "-131 2i Funded Interest ^Ll Total interwt - 1^2^ 5^ Earned interest to Dec. 15. 1933. uncollected 15.005.30 Total earned interest - 89,032.9} Operating expense on basis of disbursement vouchers issued Oct. 18. 1932, to Dec. 15. 1033 10 3S Amount Cost per application Item Received Approve! Pay roll: fin, 732. 92 42. 461. 02 Of&oe employees - Total office pay roll 63. 193. 94 $6,647 1 $8,981 Rent, light, ami heU Teleeraph ami telephone 3. 54.^. 61 1, 201. 16 3. 618. 07 1..^71 21 I.5UA.38 540.20 Office .supplies ....... . — ..... Total office expense other than pay roll 12.072.63 1.282 2.033 TotAl office exoense ........... 05. 266. 57 1 6. 933 11.013 2. 426. 92 536.29 ;.:.. Tntjil directors* exoensA 1963.21 1 .315 .aoo Field Inspectors' salaries 19. 47'J. 90 11,408.00 1 1 1 Total field inspectors* «p«n»e — 30.887.99 1 3.278 6.215 Tntal ^TDAns6 90. 117.77 3,507.73 10. 522 .372 16.734 Furniture and Hitures (asset account)... .592 Total disbursements . 102.625.50 9.420 5.923 10.894 17.323 Applirvtions: iioc^ivod • • . , Mr. WIGGLESWORTH. Mr. Chairman. I yield 15 min- utes to the gentleman from California [Mr. Hoeppel]. Mr. HOEPPEL. Mr. Chairman, I congratulate the Mem- bers who are present this afternoon, because it appears that we have a liberal audience of Congressmen. Tomorrow when the independent offices bill is under dis- cussion there will be a group of reactionary Members of 1934 CONGRESSIONAL RECORD— HOUSE 393 Congress here, and they will state that the President de- mands this and he demands that, cmd then add : " Now. like gaUey slaves, gentlemen, we plead with you to support the administration and keep the Federal employees from receiv- ing a just restoration of their pay." Mr. WOODRUM. Would it interrupt the gentleman if I asked him to yield for a moment in order that we may rise and receive a report? Mr. HOEPPEL. I yield; certainly. Mr. WOODRUM. Mr. Chairman, I move that the Com- mittee do now rise. The motion was agreed to. Accordingly the Committee rose; and the Speaker pro tempore [Mr. Baitkhxad] having assumed the chair, Mr. Bul- wxincLC, Chairman of the Committee of the Whole House on the state of the Union, reported that that Committee had had under consideration the bill H.R. 6663. the independent offices bill, and had come to no resolution thereon. RULI FOR CONflSnUTZOM Of IKDEPllTDEirT OFFXCBS IXLL Mr, POU. from the Committee on Rules, reported the fol- lowing resolution, which was referred to the House Calendar and ordered printed. HouM Reaolution 217 Resolved, That during the consideration of H.R. 0063, a bill making appropnatiotiB for the Executive Offlce and sundry tnac- pendent bureaua. boarda, commlaslona and offlcea. for the flacal year ending Jxrne 30. 1936, and for other ptirpoees, all points of order agalnnt title n or any proTisions contained therein are hereby waived; and no amendments or motions to strike out shall be in order to such title except amendments or motions to atrike out offered by direction of the Committee on Appropriations and said amendments or motions shall be in order, any rule of the House to the contrary notwithstanding. Amendments shall not be in order to any other section of the bill H.R. 6663, or to any section of any general appropriation bill of the Seventy-third Con- gress which would be in conflict with the provisions of title II of the bill HJR. 6663, as reported to the House, except amendments offered by direction of the Committee on Appropriations, and said amendments shall be In order, any rule of the House to the con- trary notwithstantling. XNOEPENDElfT OFFICES APPROPRIATION BILL. 1938 Mr. WOODRUM. Mr. Speaker, I move that the House re- solve Itself into the Committee of the Whole House on the state of the Union for the further consideration of the bill H.R. 6663, the Independent offices appropriation bill. The motion was agreed to. Accordingly the House resolved itself Into the Committee of the Whole House on the state of the Union for the further consideration of the bill H.R. 6663, with Mr. BuLwimcLE in the chair. The CHAIRBIAN. The gentleman from California is recognized. Mr. HOEPPEL, Those of us who are opposed to the gag rule will not have an opportunity to speak tomorrow on the nile. For that reason I am pleading with and appealing to every Member of the Congress who is in favor of a Just pay scale for our Federal employees to vote against this rule, unless we have liberty of action in connection with amend- ments to this proposed bill. In addition thereto, I hope those of you who have ex- pressed yourselves as being in favor of restoration of pay to our Federal workers will go to the desk and sign the petition which I have caused to be placed there. I do not believe tn pussyfooting. Those who have gone on record as favoring restoration to the Federal employees of the amount of their 15-percent pay cut should stand on their own feet. They should not take dictation from any group in this House or elsewhere, I am also in favor of increeusing the pay of the boys in the C.C.C. camps. I found during the past summer that these boys were receiving subsistence allowance of only 33 cents per day, whereas the N.R-A. men, working on the same proj- ects, were receiving $1.05 per day. Mr. DUNN. Will the gentleman yield? Mr. HOEPPEL. I yield. Mr. DUNN. Does not the gentleman also believe in increasing the pay of the soldiers, sailors, and marines? Mr. HOEPPEL. Tes; I am coming to that In a moment. Here is another feature to which I wish to refer. Just because veterans are receiving as low as $6 a month, thcQf are being denied work with the C.WA. Because our under- paid postal substitutes receive a small, inrignfflftant salary, much less than $50 a month on an aTerage. they are also denied the opportunity to work under the C.W^. I cannot imagine anything more Inhtmian and more Incompetent than the opinion cf the Comptroller General, who ruled that the postal substitutes must take a deduetitm of 16 percent in pay. notwithstanding the fact that many of them reoeite less than $25 per month. We are also denying otu: veterans, the Spanish-American War veterans especially, county relief under the subterfuie that they are receiving $15 per month. In the county of Los Angeles, if they have their homes paid for. the county will not extend any aid to them until the veterans assign their homes to the county, and then the county graciously gives to these disabled veterans the munificent sum of $17 a month, and that Is only after tbey have taken their homes away from them. That Is the situation in a deDux:racy under gag rule. If we could have more liberty of action In this Congress, we could do something for the people. A friend wrote to me stating: Tour American CongreM has enacted a bOl glviag us f«rtUla»r under the liuacle Shoals project, Tbere la more fertUiaer manu- factured in the Congress for the oommon people and more in- terest-bearing coupons mantifactizred there for the banker than can poaalbly be ooneelved. I am inclined to believe that that man had an excellent viewpoint. Just today we received a message from the President in which he proposes that we should validate farm-loan bonds and thus make the bankers a little richer. I am going to vote for those bonds, because of and to relieve the suffering of the people, but I cannot understand why a Congress as intelligent as this one seems to be does not have the courage to vote to extend credit to the people without the medium of tax-exempt securities. Under the bill which the President is proposing to us, you are adding to the burden of the American farmer — ^the tenant fanner, who is an impoverished man and who is likely to lose his home— $SO,000.000 annually In unnecessary Interest which will eventually revert to those in Wall Street who clip the coupons. We have here, in these Oovemment departments, char- women, women performing the lowest of menial tasks, and we are cutting their low stipend 15 percent. I personal^ told the President of the United States that, by his order, he was cutting the pay of hundreds of men who are receiving as low as $35 per month, after having served 30 years in the Army, men who were decorated for bravery in battle, and yet you and I and all of us. If we vote for this reduction, as It Is now. are cutting the pay of these honorable men. We are cutting the pay of the enlisted men In the service today approximately 38 percent. Do you know what hap- pened in r-^sland when they cut the pay of the men in the navy over there? They mutinied. We cut the pay of our ofllcers approximately 38 percent. This is all in the ofllclal record. Our lower ranking officers in the United States have had their standard of living debased. I state this from personal knowledge. An this Is being done because the Congress does not have the courage to stand on its own feet. The Members are tilt- ing dictation from other sources, and I do not know but that dictation comes from the very shadow of Wall Street; at least I believe it came from there when we enacted the Ec<»omy Act. We have our retired men. men who were retired after 30 years of service, receiving an insignificant salary, and a number of them are bedridden. We took 15 percent away from them and at the same time we are Increasing commod- ity prices. They write me from various places th&t prices are double what they have been, eqwclally on coal and ottker 1 11 •feAJ rnunPF.Ci.C'TONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 3% uic^tasinti uie pay oi uie suiuicia, sauuio, ouu lucuiucoi t 5 s b S 1 394 CONGRESSION A.L RECORD— HOUSE fuel, and yet there are those here who want us to cont nue We can and we should restore the salary reduction. I am Just presenting my viewpoint, but nevertheless I believe it will be more or less substantiated as time goei ; on. Mr. Hoover lost the Presidency because of the ejectic n of the bonus marchers. We who are here, especially the I> mo- cratlc Members of the Congress who voted for the Ecor omy Act and those of you who vote against restoring Federal pay, are going to And when the reaction comes that it will be a Juggernaut which will squash us. and there will be iiany men filling these seats here who are not here today, is not a threat, but the American people are aroxised, January 10 the iThis and they are not in favor of the Economy Act. notwlthstai^ing all you may hear. I know, because I associate with continuously, and I receive letters from all over the co They protest when the Oovemment. under the Econom performs a function like It did in the case of a man going to tell you about who is a personal friend of He was shot In the forehead In the Philippines and no a silver plate in his head. Re was also shot in the sto: and in the leg. He was three times wounded and thed dis- charged for disability incurred In line of duty. They dis- charged him from Letterman General Hospital while h( was yet ill. and 10 days afterward he collapsed on the 8treaid your tribute to the soldlen , and yet when we come to a little recompense, a sort of souvenir of the war times, you refuse to get the bill out of the com- mittee for a vote by the Members. As I suggested, it might apply to the homes in every township in North America. In the dimly lighted room where you see the flag and sword against the wall. We know what that means, and that it is the home of loyal people. I had a visit not long ago to my own town by a southern friend. I hope that many of you may come in the same way to my beautiful university town where Bucknell is lo- cated and where you gentlemen also put a penitentiary during my absence from this Chamber. I was very much against having a penitentiary located in a town where there is a university; education and criminality do not go together. But the answer by the proponents of this method of re- straint and reform was that these men sent there were gen- tlemen, high-toned criminals, bank robbers, bootleggers, men who stop trains in the night. You see them in that penitentiary. They are there, 1.200 of them. When I speak of that town. I am referring to a town where there are loyal people, and to this town and my home came this man of big soul. My friend. Mr. Ellis B. Betts. is the manager of an elevator here. He is from the heart of Georgia. 600 miles from here, deep into the South, I gave him the greatest surprise of his life, not in the clas.-.ic university nor in this wonderful peni- tentiary, but I took him out to the cemetery. [Laughter.] I showed him something that when I was in th3 South with Colonel Lockwood. speaking at different places, I told this same story, and they said they believed it was untrue. I said to this southerner that all the bad blood of the Civil War was gone. I took him out to this cemetery and showed him a tombstone which was erected to the memory of Major Jordon, of the Confederate Army— the Army of Northern Virginia — and which tombstone was erected between two similar stones of soldiers of the Civil War and on the burying plot of the Grand Army of the Republic. Mr. WIGGLESWORTH. Mr. Chairman, I yield the gen- tleman 5 minutes more. Mr. FOCHT. The suggestion has been made here as to whether or not we buried the old man there. No; we did not. He is too good a man to go that Vvay for a long t'me. for he has done a great dral for the North and the South by the good spirit that he daily manifests on that elevator. Now, let us take your Democratic President. I knew him before he came here — a wonderful, genial man. I had no idea at the time that he would ever be President of the United States. I had more of an idea that I might be — perhaps an erroneous idea, it is true. But he is there, and I knew him. I believe that he is patriotic, that he has fine spirit, and that he acts with the idea of progressing when he can away from some of the old methods of doing things. So far as his wisdom is concerned, of course, you have to prove that in the operation of his legislative conceptions. You cannot tell what will be the result of anything that you do here, even with the collective genius and wisdom of this whole crowd, because when you put into operation the wonderful legislation that you passed here and that was pronounced to be perfect, legislation that was going to wipe away all the tears — after you have had that legislation in operation for a short time, it comes in contact with the laws of nature, and there is where the errors are unfolded; and you will have to bring back all the legislation that was passed here for amendment and correction. There were 16 bills passed here, major pieces of legislation. Every one of them will have to be corrected, and we will have to be patient about it. because, unfortunately, you have tried them out for only a short time and yet have found erroi<^ in every one of them. You passed legislation in 40 days that ought to have tak?n about 30 years. Mr. McFARLANE. I should be glad to have the gentle- man tell us how he is going to get the soldiers' bonus legis- lation out. Mr. FOCHT. I told you that I would come to the begin- ning of my address sometime later. 1934 CONGRESSIONAL RECORD— HOUSE 3% MQ*. McFARLANE. But the gentleman Is about to run out of time. Mr. FOCHT. But not out of conversation. What did you want me to tell you about? Mr. WOODRUM. Tell us how the gentleman Is going to get the bonus bill out. Mr. FOCHT. Oh. I am going to tell you why you will not get It out. although you can. I know something of the wa3rs of legislation here. I learned that the first time that I came Into a caucus, when probably the greatest parUa- mentarian on this hill, at least the fastest worker, was James Sherman, later Vice President of the United States. In the caucus I undertook to malce a speech or to address the Chair, and he ordered me to my seat. He finally told me that If I had been here in the room when the meeting was opened I would have learned that the rules were adopted that there was to be no debate or amendment: so I took my seat. That is the first thing that I knew about parlia- mentary practice that was not practiced in the Pennsyl- iranla Legislature. Several other times when Mr. GMllett was Speaker I had reason to believe that I could get recof- nition from him In the last 5 days of the session, but every time I got up he would say. " I very much regret that I cannot recognise the gentleman from Pennsylvania for that purpose." In other words, sit down! They Ulk about Joe Cannon or Champ Clark or any Speaker or anyone who undertook to arrogate the power and concentrate it In the hands of one man — and that Is where it finally gets, does it not? When you wind up this session, there is one man who Is the supreme power in this country, and he is the Speaker of the House of Representatives. We all know that this Committee on Rules was created to break up that power, but It is really more potential than ever, particularly with a majority like this, consolidated around the Presidency, just starting to operate, a new administration with all the ap- pointments, all the big things, all the great legislation to originate. So we have this Committee on Rules. That was debated, discussed by all the " brain trusts " long before the present " brain trust " was ever heard of and by all the magazines of the country — all about this concentration of power. The CHAIRMAN. The time of the gentleman from Pennsylvania has again expired. Mr. FOCHT. Will the gentleman give me some more time? Mr. WIGOLESWORTH. How much time does the gen- tleman want? Mr. FOCHT. Oh. 15 minutes. Mr. WIGGLESWORTH. Very well. Mr. FOCHT. I do not get up very often. You imder- stand that I know the power of this committee. I know that on occasions members of the Rules Committee did not even meet, I am pretty certain this is what happened right on the floor. They went £u-ound and got the con- sent or an agreement of a majority of the members that a certain bill was to be brought out at a certain time on the floor of this House. That resolution was adopted by the House, and that resolution took away the highest privi- lege of parliamentary procedure, namely, debate and amend- ment. A bill had to come out at a certain time without debate or amendment. Talk about autocratic powers! There is where this bonus bill is slumt)ering, but for a time only I hope. Mr. BANKHEAD. Will the gentleman tell us who was in charge of the Rules Committee at the time to which he refers? Mr. FOCHT. I could not do that except in the way I have. It was not the gentleman, for you would not do it in that way. Mr. BANKHEAD. You might be surprised tomorrow when we bring in this rule. Mr. FOCHT. I should like to see you or some Democrat, if it must be, take hold of this bonus question and heartily respond to the wish of the people and enact it along with other legislation for the soldiers and their dependents. When I was here 10 years ago. I voted several times for that bonus 1^11. During my 10 years of absence I hare ret«d constantly about the bonus and why they do not get it. arid the power is here to give It to them. As I said, I belte'^e that you all believe that they ofoght to have it. but tlie alibi Is that we do not have the money. When we wm what has been appropriated, getting up Into bUMons of dol- lars, that is a small amount. Z talked with Secretary Cordell Bull. We lived at the same hotel down here, aiid he agreed with me that we needed a protective tarUT. btt he said. "Your $900,000,000 Is aU you can raise from the tariff. That will not be sufficient to nm this 0<»vcmmeBt. We have to get it some other way." As you know, Mr. Hull proceeded to reintroduce his ledslatlon putting c«i the Income tax. It was finally declared constitutional. On they get the money In that way. Just think of it, oiy friends. At that time, sitting down there m front of tlie Corcoran Hotel, where he and I lived, he said. " Just look at it. Here Is the flnt time in your life or mine when we have been called upon to appropriate a blUlon dollars to run the Gtovemment." I once heard a fellow say up in Rarrtsburf. " Who cares for a milUon dollars?" And be never came back to the Legislature again. [Laughter.] Mr. BLANTON. WIU the gentleman yield? Mr. FOCHT. With great pleasure. I have Just been reading the History of the Texas Republic, the gentlemait's home State. Mr. BLANTON. I was wondering whether the gentleman had forgotten a dozen years ago when he was somewhat of a dictator himself? Mr. FOCHT. Well, why not now? Mr. BLANTON. When the gentlwnan spoke in terms of millions of dollars, when he made his famous bariquet speech, and said that with him the Treasury floors were wide open and the blue sky was the Hmlt on what he was going to give the District of Columbia, and as soon as he went home we did not see any more of him for 12 years. Mr. FOCHT. That is the reason you are seeing me now. If I had stayed here perhaps I would not be here now, be- cause when I came back there were about 35 who had not disappeared, and I might have been one of them. Mr. BLANTON. I was just remembering what the gentle- man said about my district. He called it a Jack-rabbit district. Mr. FOCHT. Well, I guess it is yet. Is it not? [Laughter. ] Mr. BLANTON. But It has been here operating all the time the gentleman has been in Pennsylvania. Mr. FOCHT. I see the gentleman from Texas has sub- sided somewhat. I do not know what is the occasion, or who has been after him since I have been gone, but we always got along and we are going to get along. Now, Just to show you how a misconstruction might be placed upon some inno- cent statement. I did go to a banquet out here. I was chairman of the Committee on the District of Columbia at that time. I said to Mr. Wardman. " What do you want me here for? What do you want me to do? " He said. " Build us a city." "AH right ". I said- Unfortunately for Blawton, he takes some things too seriously. I know what is in his mind. It would go better today than it did at that time, although I think that was before prohibition. Anyway, his idea Is that these extravagant pictures that I painted, of the fluted coliunns and the wonderful architecture of Nineveh and Greece and Rome that would all be surpassed when I got through building this city for Harry Wardman would cost too much money. Instead of that city being built, Harry Wardman got into financial dUOculties, and I got licked for Congress. But he is still living and going to come back, and I have arrived. But to show you what occurs, my friends, I did say. I think, when I spoke in terms of dol- lars, that it might cost fifty or a hundred million dollars to beautify this great city. Someone asked a man how he liked New York. He said, " I think I shall like It pretty well after they finish it." So that will be the way with this city after they finish it. What I 396 CONGRESSIONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 397 Every one ox you nere oas leanea lar ouc over uie pia^iorm on Memorial Days and paid your tribute to the soldien . and SMJ. txjK^ni. 1 loia you tnai i wouia come lo me oegm- ning oX my address sometime later. other legislaUon for the soldiers and their dependents. J that wiU l>e the way wiin una ciiy aiver uicy musu it. *»*».< 396 I \ ''I CONGRESSIONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORI>— HOUSE 397 and and has happened? Instead of a hundred million— just see bow extravagant ideas grow from that night out at the Ward nan Park Hotel. Instead of a hundred million dollars, ^hey took my plan and laid out a program of a billion dollars, they are working on it today, and there is no difficulty no one offering any complaint even in this great depres lion. Let it go. Let us make it a great city. It is our city. Ttiere has been a lot of conversation about laying out avenues land places to put automobUes. If they had caiTled out the blan we had then, you would have had a place for automobiles long, long ago. We were going to dig out the whole down here and make a place for a garage. It would n< t be congested for 5 miles. Elevated railroads, underground rail- roads: no beer gardens or anything like that, because they had enoxigh in those alleys, but thank the Lord I hUped clean them up. too. They were not desirable anywher j. I was called wet because I was not a radical dry. So th &t is the way I got my position understood. Blr. McPARLANE. Th«» Cherokee strip. Mr. POCHT. The Cherokee strip. Now. there is onl3 one way to accomplish this program, of course, and that v ould be by an appeal to the conscience, the judgment, ana the patriotism and fairness to these soldiers. I How impotent a minority is! It may be wonderfully aggressive and accomplish great results with a passive Ima- jority. but it does not seem that that is going to happen during this session or possibly another session; it may, low- ever. if you resist the popular demand for the justice due these soldiers, the honor, mercy, pity, and compassion you owe them and ought to have for the children, the vives, and mothers. This thing has impressed me very empiati- cally £ince my return a few weeks ago to find these raany appeals. I do hope that while you are talking abouj the fanner — we are all for him. we are all for everybod]'. we want prosperity to come back — you will not forget the vet- erans. I voted with the President. I voted with hin be- cause my patriotism ran way beyond any partisai ship. Surely the patriotism and lack of partisanship of the 1 orth is manifested when we see laid away side by side one man wearing the blue and the other man wearing the p-ay. There Is no spirit of partisanship in the North and here ought not to be between the parties. You have the ac van- tage you have the control of this Oovemment. Eut a responsibility has been thrust upon you in this matter. The appeal does not come from any particular section; it comes from all parts of this country; it comes from the dept is of the souls of the American people. I cannot help bu feel that if Mr. Roosevelt understood this he would modif r the provisions of the Economy Act affecting the veterans. I sometimes doubt whether the man who becomes ] *resi- dent really receives the impulse and expression of th s will of the people. Somehow, the man who beccunes President seems to have too little time to understand these thing ;; his vision nms off into economic questions and not to the care of these soldiers. During the last session of Congress I voted with your President as I voted repeatedly with President Wilson I think in all probability President Wilson delivered i o the world the greatest hope any man ever held out for the abandonment of war as a method of settling differences He ceased to believe with the cave man that you should strip your raiment from the leopard and get direct results with the knife. Woodrow Wilson wanted to resort to p«^ceful methods of settling disputes. But they lied to hlml over there, and they cheated him. In turn. Congress was chiated. Who in the world would have voted to send the Amorican Army over to Europe after what George Washingtot said on the subject and after what Monroe said on the sul iject? It would not have been done had they not told President WQson that in the treaty of peace there would be Incjorpo rated a doctrine that should live forever; that is. that ^* should be no conquest, that there should be no victory. Mr. Chalnnan. think what happened in the treaty of i eace That sickened President Wilson; it broke his heart apd he came hooM and died. Mr. Chairman. I believe our present President has the proper impulse, the proper spirit of patriotism, the best un- derstanding possible of humanity, but I do not believe there has been a free flow up to him of the sentiment on that bill, the first one passed at the last session of Congress, the one we called the " economy bill." The veterans must be taken care of. They are public spirited. They have taken the hazard. I will agree with you on almost anything else relating to this question, but we must take care of the veterans. [Applause.] It was courajjeous. but none have yet said it was wise or helpful to the country in our present plight for President Roosevelt to have gone to the Chicago American Legion Con- vention to tell the soldiers that because they wore a uniform is no reason why they should be considered over a citizen who did not serve as a soldier. Right here is where the President breaks with the opinion of men throughout all history. He would assume an attitude toward the men who take the hazard that is a contradiction of all nationalism from the pagan days of Alexander, who sent his sick and exhausted soldiers back to Macedonia with orders for their reward; Napoleon, when confined on the barren rock of St. Helena, and just before he died, willed millions to his soldiers of the empire, although he did not have a franc. The French Government made good every bequest. England and every other civilized nation knights and be- stows fortvmes upon her soldiers. And to soldiers we might add firemen and policemen — ^men who take the hazard for all men and women and our families, men who stand between attack upon our liberty and homes and enemy attack of soldiers; and the firemen who are on guard day and night to save property and rescue lives at the risk of their own. The police officers and guards in our penal institutions have a constantly increasing risk hanging over them. That these men, in the estimation of the President, are not to be differently considered or set apart from other men whom they have protected and saved, as well as glorified as nationals, is where we are afraid the President has gone far afield in his effort to find agreement with the popular mind. A contradictory previous judgment was rendered when the law was made that now gives the soldier a 5-percent prefer- ence in all civil-service examinations. The President spoke of two principles he would have the members of the Legion contemplate and accept. We quote the following from his speech delivered in Chicago on Monday: The first principle, following Inevitably from the obligation of cltlaena to bear arms, is that the Government has a responsibility for and toward those who suffered injury or contracted dlsfiase while serving In its defense The second principle Is that no person, because he wore a uni- form, must thereafter be placed in a special class of beneficiaries over and above all other citizens. The fact of wearing a uniform do^s not mean that he can demand and receive from his Govern- ment a benefit which no other citizen receives. It does not mean that beca\ise a person served in the defense of his country, i^er- formed a basic obligation of citizenship, he should receive a pen- sion from his Government because of a disability incurred after his service had terminated and not connected with that service. It does mean, however, that those who were injured In or its a result of their service are entitled to receive adequate and gen- erous compensation for their disabilities. It does mean that generous care shall be extended to the dependents of those who died In or as a restilt of service to their country. To carry out these principles, the people of this country can and win pay In taxes the sums which It is necessary to raise. To carry out these principles will not bankrupt your Government nor throw Its booUceeping Into the red. Here is a vast change in Presidential dictum since Lincoln fell the victim of an assassin's bullet. The great man repeat- edly said what would be done for those who saved the Union. And it was done, for finally every soldier and soldier's widow received Government pension regardless of wounds or dis- abilities service connected. The President need not live long to see quite the opposite to his second point set forth in the above quotation from his speech put into action just as previous Presidents of this country sanctioned pensions not only for the wounded soldier but the needy ones as well, and out of the Government reve- nues, for the soldiers in all of our 19 wars fought for the flag of our country and what it symbolizes, and not merely for a State. Everybody will stand by the President in his drive to bring the country back to prosperity, and suffer to do it. just as they fought for peace and democracy, but which are hard to find, at least in Europe. But when we are asked to concur in the sentiment that a man who took or is willing to take the great chance for his country, or a community or individual, whether he be soldier, fireman, or policeman, is not to have special regard or consideration above other men. the President is going to be lonesome in attempting to rally any measure of concur- rence. It would be a contradiction of every element of hu- man nature as impressed and nurtured by the tragedies of advancing civilization under banners and the cross. Chiv- alry and gratitude will have to die, and the flag lose its meaning, before rich, proud America will deny after a war what was promised before the conflict, for we have the desire and money to do it. If we do not have the money, that might be a reason for temporarily withholding help, but there can be few who will agree that the man who assumes your peril does not stand apart and deserve special consideration. In contrast it should be noted how America poured out billions to the ungrateful nations of Europe and cannot take care of our own soldiers! But we can, and will. The President has said he expects to make mistakes but would correct them. We hope he may make many corrections in his economy bill, and in this latest declaration which cannot stand against the traditions of antiquity and the ready acceptance by every President of the past and the people of today. [Here the gavel fell.] Mr. WIGGLESWORTH. Mr. Chairman, I yield 1 minute to the gentleman from Pennsylvania [Mr. Swick]. Mr. SWICK. Mr. Chairman, I believe it is my duty to call the attention of Congress to a condition that has existed in one of the divisions of the Home Owners' Loan Corporation, as an example of what may be happening in miiny other branches of the various emergency agencies set up within recent months for the purpose of extending relief to citizens of the United States. In securing personnel for the many emergency organiza- tions, the usual civil-service requirements are not insisted upon, to the end that personnel officers, and in many in- stances chiefs of divisions, have the authority to secure per- sonnel and place them on the rolls in any manner they desire, despite the fact that Congress has provided employ- ment agencies to furnish such help without chsu^ge. Despite this provision, and the fact that every Member of this House is contacted daily by many men and women seek- ing employment, having qualifications for almost any posi- tion from file clerk to scientist, I have discovered, through the assistance of one of the victims, that the services of a private employment agency, located in Washington, has been used in securing personnel by one of the Home Owners' Loan Corporation divisions. In this particular case, the employee, then unemployed, registered with the Washington Business Bureau, an em- plojrment agency located in the Bond Building. Washing- ton. D.C., paid the customary registration fee, and then in company with several other registrants, was sent to the chief of one of the divisions of the Home Owners' Loan Corporation, who placed them on the pay roll as typists. Upon the receipt of their pay they are required to remit a percentage of same to the Washington Business Bureau as compensation for having been given employment. Needless to say. when this matter was called to my atten- tion I was inclined to doubt the story; however, the matter was placed in writing by one of my constituents now located in Washington, with the request that it be investigated. I first contacted the Better Business Bureau, to determine the character of the Washington Business Biu-eau. and f oimd that it had been the subject for investigation a few months ago for certain practices which were of such seriousness as to be called to the attention of the district attorney's office. The bureau is operated by John D. Kendall, a resident of the District. Mr. Kendall could not be contacted at his office, but was located by telephone at his residence. He admitted having furnished help for the division of the Home Owners' Loan Corporation, saying he was called by A Mr. / Downes to do so. He admitted having collected a registra- tion fee from the persons selected for the assignment, and the further collection of a percentage of their salaries since they have been employed. Mr. Downes, who holds a supervisory position in one of the Home Owners' Loan Corporation divisions, when con- tacted by phone, admitted having secured employees through the assistance of Mr. Kendall, but denied having any knowledge that Mr. Kendall operated an employment agency at that time. He stated that it was necessary to secure per- sonnel in a hurry, and that he was unable to get it through the regular channels provided by Congress. Mr. Downes denied having any knowledge of the employees having to pay the Washington Business Bureau, imtil the first pay day, at which time the matter was brought to his attention. He says he endeavored to contact Mr. Kendall immediately in ah effort to release the clerks from furiher payment, but was unable to locate him, until I called him yesterday. Janu- ary 9. 1934. All of the facts have been transmitted to the Chairman of the Home Loan Bank Board, with the request that the matter be thoroughly investigated by the proper authorities and that the persons responsible for the exposure be pro- tected in their positions. I appreciate the impossibility for the heads of these large emergency agencies to keep their fingers on every detail of activity in their organization, and realize they must of neces- sity rely on their many assistants to carry on. It is quite evident however, that under the present methods of securing personnel, there is opportunity for petty graft and victimizing of unemployed persons securing positions in the Govenunent service. Certainly in the administration of the great emergency program having for its basic pur- pose the relief of unemployed. Congress should not counte- nance a condition that puts Crovemment employment on the auction block. I do not contend that this condition prevails generally. I hope this is an isolated case, but the fact remains that unless personnel officers are required to fill positions through proper channels such as the Civil Service Commission or the Federal employment offices, either by Executive order or act of Congress, we will find chiseling has become a racket in the governmental service just as it is operating between contractors and employees on Federal building projects. It is time we place some safeguards about the huge ex- penditures being made for recovery, and subject emergency activities to the same restrictions and regulations, that experience has warranted in the past. Mr. WOODRUM. Mr. Chairman, I 3^eld 15 minutes to the gentleman from Ohio I Mr. TeuaxI. Mr. TRUAX. Mr. Chairman, I think this afternoon all of the Members have been intensely interested in the speeches which have been made from the floor. I think, too. that I can agree with most of the Members in what they said. The gentleman from Minnesota [Mr. Lundeen] was not referring to me. however, when he criticized those gentlemen who had not supported the veterans' legislation: nor was the gentleman from North Dakota referring to me when he mentioned those who had not signed the petition to dis- charge the committee from consideration of the Frazier bilL I signed the petition last session to discharge the committee from consideration of that bill. This fall I made 20 stump speeches at organization meetings of the Farmers' National Union in my State. Let me Inform the gentleman from North Dakota that again I will sign his petition to bring out the Frazier bill. Not only will I sign his petition, but I will use every effort at my command to follow the message of the President of the United States read here today, in which he asked this Congress to guarantee the principal as 398 CONGRESSIONAL RECORD— HOUSE January 10 1934 CONGRESSIONAL RECORD— HOUSE 399 CM&6 boiDA ftod died. 1 coimtry sanctioned pennons not only for the woimded soldier the character of the Washington Business Bureau, and round that it had been the subject for investigation a few months 01 tne rresiueni oi lac uiuuea outux rmu xicic tuu^j, lu which he asked this Congress to giiarantee the principal as i - 398 CONGRESSIONJS L RECORD— HOUSE 1 January 10 1934 CONGRESSIONAL RECORD— HOUSE 399 weU a3 the Interest of the $2,000,000,000 of Federal Farm Land Bank loans. I wonder if all of us realize that every day we spend in this Chamber 3.000 farmers and home owners in this coun- try are having their life savings legally stolen by the money lenders of this country? All of us thought in the last ses- sion of Congress that we had at least temporarily aU«vi- ated the misery and suffering of these people, but in tny own State, the State of Ohio, last month, there were seme 800 foreclosiires and confiscations of projierty. I cannot agree with the gentleman from Arkansas I Jtr. Glover 1 when he said that the Farm Credit Corporation is functioning well. It may be functioning well in his Stiite, but it is not in my State. I want to give you just two! or three tabulations. oCBcial tabulations from the Federal Bank of Louisville. Ky.. which were given out on Jan 5 of this year. During the year 1933. 15.834 applications were rece from the State of Ohio. Up to the present time there " been actually loaned i* the State of Ohio, with drafts 1.331 loans, totaling $4,999,000. and 735 commissioner's loins, totaling $952,000. The total amount of loans requested in the applications on file to date amoimt to $58,000,000 Think of this staggering comparison. Only a little $5,000,000 actually loaned and $58,000,000 requested t loaned. There have been more rejections of applicatio date than the actual drafts that have gone forth to mortgages. I Mr. Chairman, I say to you this: I agree with the gentle- men who have expressed a desire to restore in full the fed- eral pay cut of Federal employees. I am in full sympathy with any and all efforts that will be made to restore the compensation cuts of Spanish-American War veterans ind of service-connected disability cases of World War veter ins, and, in fact. I am introducing bills to cover this feature. I agree with what has been said about the Economy Act. Mr. Chairman, if the Economy Act has slain its thousaids. the administration of that act has slain its tens of tlou- sands, and the sooner that mistake is rectified that much better will this great country of ours be. Mention has l)een made that elevator operators ( nly receive $85 a month, and it is true, and it is a low saliry, and I will vote to correct it; yet I can produce for you 1,000.000 farmers in Ohio who. if you will take their faims, will gladly work for $85 a month. I care not what statements are issued from the Depart- ment of Agriculture. When they tell me they are pou ing millions of dollars into my State as they have done. I say to them the answer is 2Vi-cent hogs; the answer is 3y2-i;ent cattle; the answer is 7-cent poultry; 10 cents a pound but- ter fat; and I am speaking of the farmers of the great Com Belt. I am not referring to the southern planters, beciuse they have been vastly helped. I am not referring to | the tobacco growers, but I am referring to the great Com the boundary of which begins in my State and stretche toward the Pacific coast, and in these States the raise hogs and of cattle, the dairymen, the poultrymen. ar the worst condition they have ever been since the begi of the history of this great coimtry of ours. Three thousand homes and farms are being foreclbsed every day. Have we done our duty to these poor unjfor- tunates. whose throats have been cut from ear to ear whose blood gushes forth every day at the feet of Shylocks and the money lenders of this country. I sal have not done our duty. On April 27 last I introduced a bill that provided f^r a national moratorium against foreclosure. This bill passed upon by a number of constitutional lawyers. I again remind you that the Congress of the United States has plenary power over the bankruptcy law. This bi 1 of mine provides that whenever a landowner cannot pas taxes or his Interest or a portion of the principal which stitutes a default thereof, he becomes a bankrupt for purposes of this act. and no creditor can proceed agninst him for a period of 1 year, until he can refinance his t old- It. on of in ng and the we his Oon- the ings, either through the Farm Loan Act or the Home Loan Act of 1933. I may say to the gentlemen who have petitions lymg on the Speaker's desk that I expect to have a petition there soon which will ask to discharge the committee from considera- tion of this bill so that it may be given consideration in the House and action taken on the measure here, and I ask you gentlemen to support this bill the same as I shall support your bills. Mr. KVALE. Will the gentleman yield? Mr. TRUAX. Certainly. Mr. KVALE. Does the gentleman's measure apply also to indebtedness to the United States Government? Mr. TRUAX. My measure applies to any landowner or owner of real estate who is about to be foreclosed because of nonpayment of taxes, interest, or principal. Mr. KVALE. The gentleman did not imderstand my ques- tion. Does the bill apply to indebtedness which the land- owner may owe to the United States Governemnt? Mr. TRUAX. The gentleman means Federal Land Bank loans? Mr. KVALE. Land-bank loans, seed loans, feed loans, it matters net. Mr. TRUAX. My measure applies only to real estate, but I think it could be amended to cover all the indebtedness that the gentleman has mentioned. Mr. Chairman. I ask unanimous consent to read a por- tion of a letter which I received this morning. The CHAIRMAN (Mr. McFarlane). Without objection, the gentleman may proceed. Mr. TRUAX. They tell you that the Federal land bank is functioning. Here is a letter which relates to a neighbor of mine, a man whose farm adjoins my farm, and this is his attorney writing the letter: I am wTltlng you In behalf of Mr. Blank, who Is well ac- quainted with you and the facts of which you can attest. He has applied for a Federal farm loan and needs very little more than »4,000 for his 160 acres, the quality of which you know. It Is an excellent farm. In bad repair. It Is certainly worth far more, however, than the little he needs to save It. The money lender has a $2,500 mortgage at 8 percent interest and has started foreclosure and I have held it off for 2 or 3 months, but cannot do so any longer. The Judge, today, postponed the order of fore- closure for 10 days when advertising will start. J. O. had a hard time getting a secretary to accept his money and make application, but he flnully did about 2 weeks ago. So you see, he has not much time. Knowing the old gentleman as you do. I was hoping you would give this matter your personal at- tentSori and see that Mr. Blank is given the attention he deserves aixd assist him in getting this loan. It certainly would be a shame and disgrace to permit the mortgagee to get this farm for his small mortgage. He is using every effort to discourage a loan and wants the farm badly. Mr. LUNDEEN. Will the gentleman yield? Mr. TRUAX. I yield. Mr. LUNDEEN. I wish to call attention to the Minnesota law which, in a case like that, would extend the time in such a mortgage matter until May 1 . 1935, within which time he would have an opportunity to refinance. Would not that meet the situation in the gentleman's State? ' Mr. TRUAX. That would not cover the situation in my State. We have a moratorium law. The Governor, Georse White, was goaded into asking the legislature to pass a moratorium law, but the law that they passed stipulated that the man must have his interest and his taxes paid before the law becomes operative. Of course, that is absolutely useless, because if a man is able to pay his interest and taxes, the mortgagee will extend his time. Mr. FOSS. Will the gentleman yield? Mr. TRUAX. I yield. Mr. FOSS. Does not the gentleman think that the fault can be laid directly to the door of the appraisers? Mr. TRUAX. I would say that the blame must originally be laid to the door of A. M. Cardon, son-in-law of Reed Smoot, and also to the doers of Thomas E. Neeley, reviewing appraiser, and B. O. De Weese, assistant reviewing appraiser at Louisville, end John S. Beard, supervising appraiser for Ohio. I would state to the gentleman that I filed a report with the President of the United States on December 9. and those gentlemen have been removed or demoted. hSr. FOSS. And the blame can be brought back to the doors of these appraisers. Mr. TRUAX. The gentleman is right. At the time my report was filed there were 186 appraisers. There were only about 15 actual, honest -to-Grod farmers in the whole list. The CHAIRMAN. The time of the gentleman has expired. Mr, WOODRUM. I shield the gentleman 5 minutes more. Mr. TRUAX. It is a fact, and I have affidavits to support my charges, that some thirty-odd nonfarming occupation persons were selected as appraisers. It seemed as though every banker whose bank had closed up was sure to get a Job as an appraiser. Then next came ex-covmty agents. Then we had insurance salesmen and ex-real estate men. We had automobile salesmen, oil salesmen. We had one man who was selling iceless refrigerators. I suppose he thought he could cool the farmers' wrath and troubles. We had 30 nonfarming occupations represented as ap- praisers. I said at one time that the only nonfarm occupa- tions who failed to get jobs as appraiser was the barbers, but I found that I was mistaken. I afterwards found there were two barbers working as appraisers. Mr. BOILEAU. WUl the gentleman yield? Mr. TRUAX. I yield. Mr. BOILEAU. The gentleman states that the fault is with the appraisers. Should not the blame be placed upon Congress for permitting loans on 50 percent of the value of the land and 20 percent of the value of the building? Does the gentleman think Congress should have passed that kind of a bill? Mr. TRUAX. In answer to the gentleman I will say that whenever it became necessary because of the inexperience of the appraisers becaiLse of their youth and general dis- qualifications— whenever it became necessary to send these fellows out with augers 5 or 6 feet long to bore into the soil to determine what the land was worth. This proved conclusively that It was futile to expect fair and reason- able appraisals from a white-collar, soil-boring army of misfits. Mr. DUNN. Will the gentleman yield? Mr. TRUAX. I will. Mr. DUNN. How many of these farmers have lost their farms? Mr. TRUAX. I cannot give the gentleman the number, but there were 2.000 every day. Mr. DUNN. In the State of Ohio? Mr. TRUAX. In the entire country. I want to say that some of the larger insurance companies who signed the agreement or made a verbal agreement with the President of the United States that they would withhold foreclosures have been the most ruthless of all in the past 3 months. [Applause.] In our State we are also confronted with the evil menace of a so-called " State superintendent of banks ", Mr. Ira G. Pulton, w^ho is liquidating some 250 State banks in our State, among them the Union Trust Co. of Cleveland and the Guardian Trust b Savings, two of the biggest bank failm-es in the country. It has been the policy of Mr. Pulton under the Governor to ruthlessly foreclose when all other agencies have ceased. I recall one instance of a captain in the World War, a resident of my former home town of Syca- more, who was shell shocked. His four companions were killed instantly. This man came back from the war proud and erect, but in a few years this great shock began to teU on him. Today he is a physical wreck. He was draw- ing a pension of $148 per month, and that was completely emasculated on July 1 under the Economy Act. Within about 60 days later this captain of the World War, this hero, owed the Sycamore State Bank $1,500 and some in- terest, on which he had given his mortgage note which was past due. Ira Fulton, the State banking superintendent, sold him out. He did not sell him out, he stole his home legally, because there were no debts upon it, and Fulton bid it in in the name of the great State of Ohio. This war captain is now living In Toledo with his children. The CHAIRMAN. The time of the gentleman from Ohio has again expired. Mr. WOODRUM. Mr. Chairman. I yield the gentleman 5 additional minutes. Mr. TRUAX. Mr. Chairman, the gentleman from Arkan- sas I Mr. Glover] has made some remarks, and I am glad to hear that there is one State In the Union where the Farm Credit Corporation is functioning welL If I mistake not, I have another letter here which I shall ask permission to read. This letter was received this morning: DsAs Snt: Since I read in the Toledo Blade of yotur Investigation of the LoulsvUle land bank. I want to write and tell you that the Intermediate credit bank there needs a shaking up also. I have one of their chattel loans made through Mr. Dunlpace, of Bowling Green. Ohio. They require the interest paid In advance, and threaten foreclosure when the farmers get behind with payments. They are trying to get me to turn over my milk cows on my Louisville loan. I appreciate what you are doing, and assure you the farmers are watching your efforts. Why cannot these loans be handled by the farmers Instead of the bankers? Those are only typical of the hundreds of letters I have received since the investigation was started last summer. I say to you that this country stands today on the brink of a revolution. My colleague from Illinois [Mr. BnrrTEN] yesterday read a telegram that Chicago was without milk. Why is that so? It is because in many sections the farmers are receiving only 60 cents a hundred pounds for their milk, which is less than 1 cent a quart. In my section farmers are receiving as low as 80 cents a hundred pounds for their milk — and then you wonder why they rebel and revolt. Had not the American farmer been the most patient, the most tolerant individual on the face of the earth you would have had a revolution in this country years ago. We frequently hear or read of a recital of that first verse in Edward Mark- ham's poem The Man with the Hoe, but did you ever read the last verse of that poem? Here is the way it go«s: O masters, lords, and rulers In all lands. How will the Future reckon with this Man? How answer his brute question in tliat hotir When whirlwinds of rebellion shake the world? How wUl it be with kingdoms and with kings — With those who shaped him to the thing be i»^> When this dumb Terror shall reply to God, After the silence of the centtu-les? We need not go to Europe to find the peasant farmer. The farmers of Germany today are receiving $1.50 a bushel for their wheat, and the French farmer is getting $1.70 for his. The only progress that we have made is from an average of 47 cents in 1932 to an average of around 80 cents in 1933. These fellows down at the Department of Agriculture say that you cannot fix farm prices, yet the only success that they have had In the A.A.A. is where they have actually fixed prices by lending money on certain crops and commodities — cotton around 10 cents a pound, com at 45 cents a bushel, and so on. In my State there are not 10 counties where we sell com. We feed it into livestock, into hogs, and cattle, and poultry. This poUcy that is being urged on the farmers of the country today is the most fallacious and destructive of all times. They tell the farmer to lock up his com, to sell it and get rid of his livestock, when every son of the soil knows that one of his major efforts must be to maintain and conserve the fertility of his soil by feeding his com into his livestock. My friends, let me say before I conclude that I have been a farmer all my life. My family for generations back have been farmers. They know nothing else. On the mantel In my home Is an old grandfather's clock that ticked on the farm of one of my ancesters 140 years ago. It ticks today in my home. I say to you that now it ticks at the zero hour for this great American agriculture of ours, supreme in all the world. [Applause.] The CHAIRMAN. The time of the gentleman from Ohio has expired. Mr. WOODRUM. lifr. Chairman, there have been several requests for time, but the gentlemen who requested it arc not present. My colleague advises me there are no ftuther requests on that side, so I move that the Committee do now rise. The motion was agreed to. \ I I > 400 CONGRESSIONi lL RECORD— HOUSE January 10 Accordinsly the Committee roee: and the Speaker ha resumed the chair, Mr. Bulwikkli, Chairman of the C mlttee of the Whole House on the state of the Union, ported that that Committee, having had imder considera the bill HJl. 6663. the independent offices appropriation had directed him to report that it had come to no resolui thereon. KXTEKSION OF REMARKS Mr. McKEOWN. Mr. Speaker, I ask unanimous con*nt to extend my remarks in the Record by Including a le- cision of the Supreme Court of the United States in wha ; is known as the " Moratoriirai Case ", a mortgage case fijom Minnesota. The SPEAKER. Is there objection to the request of Ithe gentleman from Oklahoma? Mr. BULWINKLE. Reserving the right to object, that matter has already been entered in the Record by the gjen tleman from Minnesota (Mr. Lundeen] this afternoon Mr. McKEOWN. Very well. In that case I will with draw my request. Mr. BONDERO. Mr. Speaker, I ask unanimous consent to revise and extend the remarks I made in committee on Ithe St. Lawrence waterway. The SPEAKER. Without objection, it is so ordered. There was no objection. LEAVE or ABSENCE By unanimous consent, leave of absence was granted to Mr. SxTTPHiK. for an indefinite period, on account of illi^ess in his family. AOJOURNICENT Bfr. WOODRUM. Mr. Speaker, I move that the Housq do now adjourn. The motion was agreed to; accordingly (at 3 o'clock knd 56 minutes pjn.) the House adjourned until tomonjow, Thursday, January 11, 1934, at 12 o'clock noon. EXECUTIVE COMMUNICA-nONS, ETC. Under clause 2 of rule XXIV, executive communicatibns were taken from the Speaker's table and referred as folio nrs 275. A letter from the Postmaster General, transmitli_„ herewith the cost ascertainment report for the fiscal jjear 1933 : to the Committee on the Post Office and Post Road^. 276. A letter from Hamilton and Hamilton, transmit|Lng copy of the annual report of the Georgetown Barge, D^k. Elei'ator It Railway Co. for the year ended December 1933: to the Committee on the District of Columbia. 31. Airo REPORTS OP COMMITTEES ON PUBLIC BILLS RESOLUTIONS Under clause 2 of rule XTII. Mr. WOODRUM: Committee on Appropriations. ttJl. 0663. A bill making appropriations for the Executive Office and sundry independent executive bureaus, boards, commis- sions, and olBces for the fiscal year ending June 30, 1935, and for other purposes: without amendment (Rept, No, 2i7) , Referred to the Committee of the Whole House on the liate of the Union, Mr, f^^: Cranjniitef on Rules. House Resolution tll7. Resohitkm flMkin« in order for eonstderatlon the ptofm at title n «rf ttie Mil WVWI4(} WiUM AMI RMOUmOlff VfMMf gUm» « *H rule %%U, mtitii§ Win aim! rmtUtiiimM w*ri Iiiir0d4if«d »ft4 «Mtver»Uir mBff$4 m MUm§i Vr Mr, WOODRUM A m iHM. MM) WMMflf ftpprop^U' iUm» for tlM iRoeutivs oifUte t^nd sundry indopondont mm tu- U¥t burtdu*. boards, commissions, and oflleof (or the fl ical PMir endliui Juno M, 1035. and for oihor purpoMs; to the Oommlttoo on Appropriations, Br Mr. IMWIB ot Maryland: A blU (K.R. MM) (o |au< tHerlM ttoo Sooretary of ths Treasury to provldo for the of annuities to citizens of the United States In order to pro- mote thrift, to provide ways and means for raising capital fimds for necessary permanent improvements and additions to the property of the United States, and for other pur- poses: to the Committee on Ways and Means. By Mr. CARTWRIGHT: A bill (HJl. 6665) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Government ", and Public Law No. 78. Seventy -third Congress, entitled "An act making appropriations for the executive offices and sun- dry independent executive bureaus, boards, commissions, and offices for the fiscal year ending June 30. 1934, and for other purposes "; to the Committee on World War Veterans' Legislation. By Mr. McPARLANE: A bill (H.R. 6666) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to main- tain the credit of the United States Government ", and Pub- lic Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bureaus, ooards, commissions, and offices for the fiscal year ending June 30, 1934, and for other purposes": to the Committee on World War Veterans* Legislation. By Mr. MARLAND: A bill (H.R. 6667) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to main- tain the credit of the United States Government ", and Pub- lic Law No. 78, Seventy-third Congress, entitled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, commissions, and offices for the fiscal year ending June 30, 1934, and for other purposes ": to the Committee on World War Veterans' Legislation. By Mr. COCHRAN of Pennsylvania: A bill (H.R. 6668) to amend Public Law No. 2, Seventy-third Congress, entitled "An act to maintain the credit of the United States Govern- ment ", and Public Law No. 78, Seventy-third Congress, en- titled "An act making appropriations for the executive offices and sundry independent executive bureaus, boards, conMnissions, and offices for the fiscal year ending June 30, 1934. and for other purposes "; to the Committee on World War Veterans' Legislation. By Mr. MOTT: A biU (HJR. 6669) providing for a survey of the Skipanon Channel. Oreg.; to the Committee on Rivers and Harbors. By Mr. JONES: A bill l*lrUit of Okintunm Ut bs held at iih«wnee, OkU,; (0 the Committee on the JudUslary, Sy Mr, DCmnWH. A bin (H.R. 0076) to authorlM the Mknovledtfment of oathi by post-omce ln«peotori and by chief clerks of the Railway Mall Bervlco; to the Ooounlttoo on the Post Office and Post Roads. 1934 CONGRESSIONAL RECORD— HOUSE 401 By Mr. MOREHEAD: A bill (HJl. 6676) to require post- masters to account for money collected on parcels delivered at their respective offices; to the Committee on the Post Office and Post Roads. By Mr. LAMNECK: A biU (HJl. 6677) to authorize the Postmaster General to contract for air mall service in Alaska; to the Committee on the Post Office and Post Roads. By Mr, GOLDSBOROUGH : A bill (H.R. 6678) to provide for the examination and survey of the waterway from the Pocomoke River at or near Snow Hill, Md., to the Chinco- teague Bay: to the Committee on Rivers and Harlwrs. Also, a bill (HJl. 6679) to provide for maintenance work on Upper Thoroughfare. Deals Island. Md.; to the Com- mittee on Rivers and Harbors. By Mr. BLAND: A bill (H.R. 6680) to amend the act en- titled "An act for making further and more effectual pro- vision for the national defense, and for other purposes ", ap- proved June 3. 1916. as amended, and for other purposes; to the Committee on Military Affairs. By Mr. BAILEY: A bill (H.R. 6681) to provide revenue, to regulate commerce with foreign countries, to encourage the cattle industry of the United States, and for other purposes; to the Committee on Ways and Means. By Mr. WOODRUFF: A bill (H.R. 6682) granting to the State of Michigan for institutional purposes the property known and designated as the Mount Pleasant Indian School; to the Committee on Indian Affairs. By Mr. McFARLANE: A bill (H.R. 6683) to provide pun- ishment for certain offenses conmiitted against member banks of the Federal Reserve Sjrstem. banks organized under laws of the United States, and banks located in the District of Columbia, the Canal Zone, and Territories and posses- sions of the United States, and for other purposes; to the Committee on the Judiciary. By Mr. GOLDSBOROUGH: A bill (HJl. 6684) to provide for maintenance work on Knapps Narrows, Talbot County, Md.; to the Committee on Rivers and Harbors. By Mr. FTJLMER: A bill (H.R. 6685) to exempt hog pro- ducers, under certain circumstances, from the processing tax under the Agricultural Adjustment Act. not to exceed $100 in value; to the Committee on Agriculture. By Mr. MOTT: A bill (H.R. 6686) authorizing a prelimi- nary examination and survey of the Willamette River, with a view to the controlling of fioods; to the Committee on Flood Control. By Mr. REILLY: A bill (H.R. 6687) to provide for a sur- vey of the Fox River, Wis., with a view to the prevention and control of floods; to the Committee on Flood Control. By Mr. OLIVER of New York: A bill (H.R. 6688) to amend section 2 of the act of February 13, 1893; to the Com- mittee on Interstate and Foreign Commerce. PRIVATE BILLS AND RESOLUTIONS Under clause 1 of rule XXII, private bills and resolutions were introduced and severally referred as follows: By Mr. BANKHEAD: A bill (H.R. 6689) for the relief of John A. Shannon; to the Committee on Military AfTairs. By Mr, BOLARtI; A bill ^H.R. 6090) for the relief ot certain ofBcers of the Dental CotpB at the United mates Rary; to the Oommlttee oh Ratal Affairs, By Mr. CARfSimSR ot Kntm§'. A bill (MR. 9««1) tor Ihe rrtief ot William W, tHumwUfk', Ut th# ©trffimitte* on Up Mr. tmumnm a mi (Hm mif tm fh« rifii#f #f nmiMi UmmM\\ (# tl«« Himmii^^ tm t:fittimM, »y Mr, OiMjmi?! A bin '«« iumi tttt th# r»Mof #f Mr/», H, H, Rrufmaflfi) i4i ilis «wH«»iti#s m (iUum A1«0; a bill iHM, l«#4> arariiliia a immum io Rmma J, Rbarly; to th# Oommittee on Invalid Pansion«, AUo, a tolU (R.R, 9Mi) for th« relief of M. R, Bandar ; to the Committee on Claim*. Also, a biU (HM. Mf«) for the relief of William T, floeho; to tht Oommltteo on Clalma . By Mr, HAMILTON; A bill (K.R. M97) grantlnf a pan- alon to AUa Olaeoa; to the Committee on Peniiona. LXXVXXZ — 96 By Mr, HUDDLE8TON: A biU (H.R. 6698) to authorise WUllam W. Hicks, major. United States Army, to accept certain decorations conferred upon him by the President of the Austrian RepubUc and the President of the Caechoslovak Republic; to the Committee on Foreign Affairs. By Mr. IMHOFF: A bill (H.R. 6699) granting a pension to Bessie Humphrey ; to the Committee on Pensions. Also, a bill (H.R. 6700) granting an increase of pension to Emma J. Miller; to the Committee on Invalid Pensions. By Mr. JONES: A bill (Hil. 6701) for the relief of John F. Cain; to the Committee on Claims. By Mr. KOCIALKOWSKI : A bill (HJl. 6702) for the reUef of the estate of Paul Kiehler; to the Committee on Claims. By Mr. KRAMER: A bill (H.R. 6703) granting a pension to Pearl Bouchle; to the Committee on Pensions. Also, a bill (HJl. 6704) granting a pension to Edith M. Cruise; to the Committee on Invalid Pensions. By Air. REECE: A bill (Hil. 6705) granting a pension to Clyde Rains Winters; to the Committee on Pensions. Also, a bill (HJl. 6706) to reinstate John H. Babb, Jr.. as midshipman In the United States Naval Academy; to the Committee on Naval Affairs. Also, a bill (HJl. 6707) granting a pension to Lizzie May; to the Committee on Invalid Pensions. By Mr. SHANNON: A bill (HJl. 6708) granting a pension to Katie Ciunmings; to the Committee on Invalid Pensions. .By Mr. SMITH of West Virginia: A bill (HJl. 6709) for the reUef of Samuel E. Bowen; to the Committee on Claims. By Mr. TERREIii of Texas (by request) : A bill (HJl. 6710) to confer jurisdiction upon the Court of Claims to hear, determine, and render judgment upon the claim of E. W. Cole against the United States; to the Committee on Claims. By Mr. THOMPSON of Illinois: A blU (HJl. 6711) grant- ing a pension to Luther J. Smith; to the Committee on Pensions. By Mr. THOMASON: A bill (HJl. 6712) for the relief of Emery C. Pickett; to the Committee on Military Affairs. By Mr. UNDERWOOD: A bill (HJl. 6713) granting a pen- sion to Mary M. Nichols; to the Committee on Invalid Pensions, Also, a bill (HJl. 6714) granting a pension to Mamie O. Poindexter; to the Committee on Pensions. Also, a bill (HJl. 6715) granting a pension to Edith Pyle; to the Committee on Invalid Pensions. Also, a bill (HJl. 6716) granting a pension to Henry Charles Russell; to the Committee on Invalid Pensions. Also, a bill (H.R. 6717) granting a pension to William Conrad; to the Committee on Invalid Pensions. Also, a bill (H.R. 6718) granting a pension to Josephine Farris; to the Committee on Invalid Pensions. Also, a bill (HJl. 6719) granting a pension to Elmer E. Finley; to the Committee on Pensions. Also, a bill (HJl. 6720) granting a pension to Fannie Himes; to the Committee on Invalid Pensions. Also, a bill (H.R. 6721) granting a pension to John W. Hamilton; to the Committee on Invalid Pensions. Also, a Mil (H.R, 6733) granting a pension to Surelda i, CHlptn; to the Committoe on Intalld fenslona. Alao^ a Mil (HM. 6739) fratitltii a pension to Haitfilo 1/ tkmi to ttM CotnffllttM on IhtftlMT P$Mkfn§. Aintt, a Mil (flM> 67M) puniinu a tmHim i# Wftteftf rtilli} t« ifw C6miiilti#6 6fi Pimktm> ^ , ^. ^, Aia6/ » Mil tnn, nuf nfMMmi » pmm i9 mm Md* mmm mnmnj Ut iH« Gmmimi mi liwalld 9m^. Mm, * MM mn, 6711/ WTMiiMi • P6iMl#H l« Mdfiifol Kmi\0Vi i» i^ GmmiH9$ fm liiy»M PimM^m, _ _ Aim, a Mil tHM, 6797/ ffM»iiiii i jpanaldfi Id Mmt nmmik mimfAi to th« Omtmiim on Iiiv6ttd fnniiofyt, Alao, a MU iHM, 67961 vraMtlni § panaldn to Mmt Wliiu craft Conkla; to tha Commlttaa on Xovalld Fanalona, AIM, a blU iHM, 6736) frantlng a penalon to AUoe M. Baker; to the Commlttoa on Invalid Fanalona, Alao, a MU (HJl. 6790) granting a ponalon to Fannie Brlttingbam; to ttoa Committoo on Invalid Fanalona. I i i 402 CONGRESSIONAL RECORD— HOUSE Also, a bill (H.R. 6731) granting a pension to George V. Bowen: to the Committee on Invalid Pensions. Also, a bill 'H.R. 6732) granting a pension to Emiia Blosser; to the Committee on Invalid Pensions. Also, a bill (H.R. 6733* granting a pension to Orlando Klildow; to the Committee on Pensions. Also, a bill (H.R. 6734 » granting a pension to Debbie Klingler; to the Committee on Invalid Pensions. Also, a bill (H.R. 6735* granting a pension to Stella Litt e- john; to the Committee on Invalid Pensions. Also, a bill iHJl. 6736) granting a pension to Maud E. Morrow; to the Committee on Invalid Pensions. Also, a bill (H.R. 6737) granting a pension to Mary C. Storer; to the Committee on Invalid Pensions. Also, a bill (H.R. 6738 > granting a pension to Lottie Van- gxmdy; to the Committee on Invalid Pensions. Also, a bill (HJl. 6739) granting a pension to Isaac Shre< k- engaust: to the Committee on Invalid Pensions. Also, a bill (H.R. 6740) granting a pension to Jostrna Shreckengaust: to the Committee on Invalid Pensions. Also, a bill (HJl. 6741) granting a pension to Minnie Vil- entine: to the Committee on Invalid Pensions. Also, a bill (HJR. 6742) granting a pension to Margaret M. Warner; to the Committee on Invalid Pensions. Also, a bill (H.R. 6743) for the relief of Esther M. Pirity; to the Conunittee on Claims. Also, a bill (HJl. 6744) granting an increase of pension to Jeanette Wallace; to the Committee on Invalid Pensions. Also, a bill (Hil. 6745) granting an increase of pension to Sarah A. Swick; to the Committee on Invalid Pensions. Also, a bill (KM. 6746) granting an increase of pension to Ellen J. Vince; to the Committee on Invalid Pensions. Also, a bill (HJl. 6747) granting an increase of pens on to Bertie L. Santee; to the Committee on Invalid Pensioos. Also, a bill (HJi. 6748) granting an increase of pension to Flora Smith: to the Committee on Invalid Pensions. Also, a bill (HJl. 6749) granting an increase of pens on to Alwilda Ray; to the Committee on Invalid Pensions. Also, a bill (HJi. 6750) granting an increase of pension to Norma Roush; to the Committee on Invalid Pensions. Also, a bill (HJl. 6751) granting an increase of pens on to Sarah Ella Pinney ; to the Committee on Invalid Pensio as. Also, a bill (HJl. 6752) granting an increase of pens on to Mary M. Poling; to tlie Committee on Invalid Pensions. Also, a bill (HJl. 6753) granting an increase of pens on to Eliza Noble; to the Committee on Invalid Pensions. Also, a bill (HJl. 6754) granting an increase of pens on to Amanda J. Oxley; to the Committee on Invalid Pensions. Also, a bill (HJl. 6755) granting an increase of pens on to Mary A. Moore; to tl:ie Committee on Invalid Pensions. Also, a bill (HJl. 6756) granting an increase of pens on to Margaret R. F. Newell; to the Committee on Invslid Pensions. Also, a bill (HJl. 6757) granting an increase of pens on to Mary A. Little; to the Committee on Invalid Pensions. Also, a bill (HJl. 6758) granting an increase of pens on to Katherlne Meyer; to the Committee on Invalid Penslcna. January 10 Also, a bill (HJl. 6759) granting an increase of pensioq to Nettie Huffman; to the Committee on Invalid Pensions. Also, a bill (HJl. 0700) granting an increase of pensioi^ to Julia A. Hull; to the Committee on Invalid Pensions. Also, a bill (HJl. 6761) granting an increase of pensioi^ to Alatha Hickman; to the Committee on Invalid Pensions. Also, a bill (HJl. 6762) granting an increase of pensioi^ to Hattie B. Oolden; to the Committee on Invalid Pensions. Also, a bill (HJl. 6763) granting an increase of pensioi^ to Hester Floyd: to the Committee on Pensions. Also, a bill (HJl. 6764) granting an increase ot pensioii to Elizabeth Poughty : to the Committee on Invalid Pension \. Also, a bill (HJl. 6765) granting an increase of pensioq to Mary M. Devol; to the Committee on Invalid Pensions. Also, a biU (HJl. 6766) granting an increase of iwnsioi^ to Estelle Eby: to the Committee on Invalid Pensions. Also, a bill (HJl. 6767) granting an increase of pensioi^ to Susanah Cooper; to the Committee on Invalid Pensions. Also, a bill (HJl. 6768) granting an increase of pension to Laura J. Dehnen; to the Committee on Invalid Pensions. Also, a bill (HJl. 6769) granting an increase of pension to Delilah Coffman; to the Committee on Invalid Pensions. Also, a bill (HJl. 6770) granting an increase of pension to Nancy Consolver; to the Committee on Invalid Pensions. Also, a bill (HJl. 6771) granting an increase of pension to Mary E. Baker; to the Ck)mmittee on Invalid Pensions. Also, a bill (HJl. 6772) granting an increase of pension to Martha Buckingham : to the Committee on Invalid Pensions. By Mr. WALLGREN: A bill (H.R. 6773) for the relief of Pred Perch; to the Committee on Claims. By Mr. WILCOX: A bill (H.R. 6774) for the relief of Wal- ter W.Johnson: to the Committee on War Claims. By Mr. WILSON: A bill (H.R. 6775) for the reUef of E. F. Purvis: to the Committee on Claims. PETITIONS. ETC. Under clause 1 of rule XXII, petitions and papers were laid on the Clerk's desk and referred as follows: 1534. By Mr. AYERS of Montana: Memorial of the Mon- tana State Legislature, relating to the condition of agri- culture within the United States; to the Committee on Ag- riculture. 1535. Also, memorial of the Montana State Legislature, re- questing the purchase of Montana cattle for distribution to workers on Federal projects and for relief of the destitute in the State of Montana; to the Committee on Agriculture. 1536. Also, memorial of the Montana State Legislature, re- questing the establishment of an assay office at some appro- priate place in Montana; to the Committee on Public Build- ings and Grounds. 1537. Also, memorial of the Montana State Legislature, re- questing the enactment of effective laws prohibiting the pro- ducers and distributors of gasoline from establishing unfair and unjust prices for the sale at retail to the people of the United States, and thus removing unjust discrimination; to the Committee on Interstate and Foreign Commerce. 1538. By Mr. BAKEWELL: Petition of Captain Charles B. Bowen Camp, No. 2, Department of Connecticut. United Spanish War Veterans, Meriden. Conn., praying for repeal of the Economy Act; to the Committee on Appropriations. 1539. By Mr. JOHNSON of Minnesota: Petition by citizens of Duluth. Minn., protesting against the passage of House bills 1608 and 1643; to the Committee on Interstate and For- eign Commerce. 1540. Also, resolution by the Minnesota Junior Taxpayers Association, urging allocation of funds to State educational departments to insiire adequate educational facilities; to the Committee on Education. 1541. Also, resolution by the Minnesota Farm Managers Association, with reference to tariff on oils and fats: to the Committee on Interstate and Foreign Commerce. 1542. By Mr. KOPPLEMANN: Petition in the nature of a resolution of Captain Charles B. Bowen Camp. No. 2, Meriden, Conn.: Resolved. That the members of this carnp go on record and respectfully request the repeal of the Econ- omy Act and that benefits that have been taken away be restored: to the Committee on Appropriations. 1543. By Mr. HOEPPEL: Petition of residents of the Twelfth Congressional District of California, urging restora- tion of pensions, hospitalization, and care of veterans of the Spanish-American War as same existed prior to the enactment of Public. No. 2. Seventy -second Congress, and requesting especially the reinstatement of the act of June 2, 1930; to the Committee on Appropriations, 1544. By Mr. LAMBERTSON: Resolution adopted at the regular meeting of the Woman's Christian Temperance Union, of McLouth, Kans., urging favorable consideration of the Patman motion-picture bill HJl. 6097. providing higher moral standards for films entering interstate and international commerce, signed by the president. Anna K. Sanders, and secretary. Hattie Guest, of McLouth, Kanj.; to the Committee on Interstate and Foreign Commerce. 1934 CONGRESSIONAL RECORD— SENATE 403 1545. By Mr. LINDSAY: Petition of Western Union Cable Employees Association, New York City, protesting against proposed merger of communication companies; to the Com- mittee on Interstate and Foreign Commerce. 1546. Also, memorial of National Association of Letter Carriers, urging repeal of the salary reduction as authorized by the so-called " Economy Act "; to the Committee on Appropriations. 1547. By Mr. PARKER: Petition of Mayor Thomas Gamble and other citizens of Savannah, Ga., who are not veterans of the Spanish War, asking the restoration of bene- fits to Spanish War veterans, and further asking that they have the same benefits as the Federal veterans of the war between the States; to the Committee on Appropriations. 1548. By Mr. AYERS of Montana: Petition of Harry Arm- strong of Armington, Mont., praying for agricultural relief upon a basis of prices for farm and ranch products whereby agriculture may relieve itself without drawing on the Public Treasury; to the Committee on Agriculture. 1549. By Mr. RICH: Petition of members of the Kane (Pa.) Parent-Teachers Association, favoring the passage of Senate bill 1944; to the Committee on Agriculture. 1550. By Mr. SHANNON: Petition of Greater Boston Restaurant Association, 16 Waterford Street, Boston, Mass., with reference to the elimination of Government restaurants located on Federal property: to the Committee on Appro- priations. 1551. By the SPEAKER: Petition of the Common Council of the City of Milwaukee, Wis., regarding the creation of a Federal commission; to the Committee on Ways and Means. SENATE Thursday, January 11, 1934 The Chaplain, Rev. ZSBarney T. Phillips, DJD., offered the follov.ing prayer: O Thou, to whose all-searching sight the darkness shineth as the light, bless us with the vision of Thyself, without which man is no longer man: for all that thought can grasp or eye perceive is but a shadow of Thy power, which hath created and upholdest all. In the joy of Thy strength may we work without haste, without sloth, and, being faithful to the past, to eternal truth and beauty, may we, as watchers for the dawn, look for the unseen day when the city of God shall rise in splendor in our midst. And since before Thee all our hearts are bare, and not even the shadow of a thought can rise without Thy knowledge, do Thou guard each tempted heart and keep it pure from each unholy wish, that we may treas- ure only thoughts of Thee to guide us in our work through all the cloudy days that lie ahead. Accept our prayer, the incense of the soul, and hallow it with Thy perfecting grace; through Jesus Christ our Lord. Amen. THE JOXTRNAL The Chief Clerk proceeded to read the Journal of the proceedings of yesterday, when, on request of Mr, Robihsoh of Arkansas and by unanimous consent, the further reading was dispensed with and the Journal was approved. TAXATION or INTOXICATING LIQUORS Mr. HARRISON. I desire to enter a motion to recon- sider the votes by which the bill H.R. 6131, the so-called " liquor tax bill ", was ordered to a third reading and passed on yesterday. I desire to say that as soon as morning busi- ness shall have been concluded I will make the motion. The VICE PRESIDENT. The motion will be entered. PETITIONS AND MEMORI.\LS The VICE PRESIDENT laid before the Senate a letter in the nature of a petition from Frank J. Pexa, of Lonsdale, Minn., praying for the passage of the so-called " Frazier bill ", providing for the refinancing of farm mortgages, which was referred to the Committee on Agriculture and Forestry. Mr. WALSH presented a petition of 100 dtiaens of the state of Massachusetts, praying for the passage of the so- called " Hatfleld-Keller railroad retirement bill ", beUig the bill (S. 817) to provide for a retirement system for railroad and transportation employees, to provide imemployment re- lief, and for other purposes, which was referred to the Committee on Interstate Commerce. Mr. TYDINGS presented a memorial numerously signed by sundry citizens of Baltimore, Md., remonstrating against the adoption of the so-called " Prince plan " for the con- solidation of the Baltimore & Ohio Railroad Co. with the Pennsylvania Railroad Co. as tending to lessen employment, which was referred to the Committee on Interstate Commerce. Mr. ROBINSON of Arkansas presented the following memorial of the House of Representatives of the Legislature of the State of Arkansas, which was referred to the Com- mittee on Education and Labor: House Memorial 1 To the honorable Senators and Represattatives from Arkansas in the United States Congress assembled: We, your memorialists, the House of Representatives of the State of Arkansas, being assembled In an extraordinary session of the forty-ninth general as-sembly, most respectfully memorialize and petition you as follows: Whereas the United States Government is spending vast sums of money to provide employment; and Whereas It behooves all of us In working for the Nation's recov- ery to work for the greatest good for the greatest nimiber; and Whereas by reason of the regulations under which money Is being spent by the United States Government for tlie purpose of relieving the unemployment situation many persons are furnished steady employment while others receive none at all; and Whereas this situation leads not only to the necessity for direct relief but to a condition of unrest among the people so affected: Therefore we. the members of the House of Representatives of the State of Arkansas, respectfully petition you, collectively and individually, to use your Influence to have the regulations afore- said changed in such manner as wIU more equitably distribute the employment provided for; be it Resolved, That the chief clerk of this body be, and he is hereby, directed to forward at once copies of this memorial to each Mem- ber of the National Congress from Arkansas at Washington. D.C. State of Arkansas, County of Pulaski: I. James R. Campbell, chief clerk of the House of RepresenU- tlves of the State of Arkansas, hereby certify that the foregoing House Memorial 1 was duly adopted by the house of representa- tives at the extraordinary session of 1934 and is a true and com- pared copy of same. _ ^ James R. Campbxu., Chief Clerk. Mr. CAREY presented the following joint memorials of the Legislature of the State of Wyoming, which were referred to the Committee on Finance: Th« 8tat« or Wtomiko, OiTxcB or TUX Sbcbstabt or State. UNnxD Statu or Ambrica. State of Wyoming, at: I, A. M. Clark, secretary of state of the SUte of Wyoming, do hereby certify that the annexed Is a full, true, and correct copy of enrolled Joint Memorial No. 1, house of reprewnUUvee of the spe- cial scaelon of the Twenty-eecond Legislature of the State of Wyo- ming, being original houee Joint Memorial Wo. 1, approved by th« Oovornor on December 16. 1938. at 4:66 p.m. ^ ^ ^ In testimony whereof I have hereunto tei my band and mum the great seal of the State of Wyoming. _*«,«•.. Done at Cbeyenne, tb« capital, this Sd day of Januarv, AD. 10M. r«KAi.l A. M. Clasx. ' ' Secretary of Btatt. By O. J. RooBM, Deputy. Enrolled Joint Memorial 1, House of RepretenUtivee. Twenty- second Legislature of the State of Wyoming. memorlaUztng the President and the Congress of the United SUtes to enact legle- lation prohibiting or curtailing the Importation of canned beef Be it resolved by the House of Representatives of the special session of the Twenty-second Legislature of the State of Wyo- ming (the senate concurHng). That the Congress of the United States be memorialized as follows: That — Wliereas there is at this time an average monthly importation of South American canned beef to the amount of over 4.000.000 pounds, and this canned beef is sold throughout the United State* to the detriment of the market for American -grown beef; and Wliereas the beef Industry. Wyoming's largest Industry, is suf- fering from this competition; and Whereas the price of beef cattle produced in Wyoming Is below the cost of production: Now. therefore, be It hereby lAl rONORESSIONAL RECORD— SENATE January 11 1Q.^4 CONGRESSIONAL RECORD— SENATE 405 . ^»*^W^f *■ vMirW \/&A ■ iiy^a 0vc»vb tin na a \j* '-'ffcf t ^^yyiauii^A w««« 404 CONGRESSIONAL EECORD— SENATE Resolved bf flk« Ilouae of Representatives of the special setaicn of the Tu>enty -second Legislature of the State of Wvoming {the senate concurring) . That we hereby memorialize the President and the CongreM of the United States of America to paw an act pro- hibiting furthT Importation of canned beef; be It f\irther Rewlved. That certified copies of thU concurred memorial be forwarded to the Wycwnlng Senators and the Wyoming Repre- sentative in the Congress of the United States of America. Oscaa Bbcx. President of the Senate. Wm. M. Jack. Speaker of the House. ApproTcd 4:55 pjn. December 18. 1933. Lksliz a. Mn.T.n. Governor. Th» Stat* of Wtomiwo, Omcs or thc SscaETAST or Statx. Ctrrm Statbs or AmxicA, State of Wf anting, $s: 1. A. U. Clark, secretary of state of the State of Wyoming, do hereby certify that the annexed l:i a full. true, and correct copy of Enrolled Joint Resolution No. 1. House of Representatives of the Special Session of the Twenty-second Legislature of the State of Wyoming, being original House Joint Resolution No. 4. approved by the Governor on December 26. 1933. at 4:40 pjn. In testimony whereof I have hereunto set my hand and affixed the great seal of the State of Wyoming. Done at Cheyenne, the capital, this 3d day of January. AJ3. 1934. [SSAI.] A. M. CuutK. Secretary of State. By C. J. Rocots. Deputy. Enrolled Jc^nt Resolution No. 1. memorializing Federal Emergency Administration of Public Works to allocate funds for Irrigation projects in the State of Wyoming, in addition to the funds allocated to the Caaper-Alcova project Whereas there Is now pwndlng from Wyoming before the Fed- eral Emergency Administration of Public Works an application of the French Creek Irrigation Co.. of Johnson County, for the sum of •100.000 for the construction of a reservoir and ditch; of the Orevbull Valley Irrigation district, of Big Horn County, for the sum of 9968.000 for the construction of a reservoir and dam; of the Bear River Water Users' Association of Uinta County the sum ai »433.800 for the construction of a reservoir: of the Rock Creek, Plney Reservoir & Ditch Co.. of Johnson Coxuity, the sum of •flO.oioo fo» construction of a restrvotr: and of Clear Creek Irri- gation district, of Johnson County, for the sum of $106,600 for construction of a reservoir; and for the construction of the Bull Lake Reservoir In Fremont County the sum of f400.000: and Whereas these projects have been approved by the State advisory bo(u^ and State administration for allocation and loan; and Whereas a formal application has been made to the State ad- visory board and State administration on the part of the North Plney Irrigation district in Sublette County for the sum of $80,000; by the settlers' irrigation district of Lincoln County for the sum of $100,000: and for the Owl Creek Reservoir, of Hot Springs County, for the sum of $360,000: and Whereas there are seven additional applications to the State advisory board and State administration in course of preparation asking allocations for Irrigation purposes in the total amount of $555,000; and Whereas these applications are In almost every Instance for the purpose of securing a supplemental supply of water for lands now under Irrigation by the impounding of flood waters; and Whereas the Federal Emergency Administration of Public Works has in the States of Washington. Oregon. California. Arizona. Mon- tana, and other States allocated funds for public works In addition to those allocated for the major project therein; and Whereas there has been allocated by the Federal Emergency Ad- ministration of Public Works $22,700,000 for the construction of the Ca.sper-Alcova project In Wyoming: and Whereas the funds asked to be allocated for projects in Wyo- ming other than those allocated for the Casper-Alcova project are less than $2,500,000; and Whereas there has been allocated in the State of Washington. In addition to $63,000,000 for the Grand Coulee project, an siddl- tlonal $1,000,000 for other work; In the State of Oregon. In addi- tion to $20,500,000 for the Bonneville Dam. over $7,500,000 for other projects: in the States of CaJifornla and Oregon, in £ulditlon to $38.000'.000 for the Boulder E>am. over $48,000,000 for other proj- ects: in the State of Montana, in addition to $15,500,000 for the Fort Peck Dam. over $1,000,000 for other pur]x>ses; in the State of Tennessee, In addition to $50,000,000 for one project, a svim of over $;i.000.000 for other purposes; while In the State of Wyoming. In addition to $22,500,000 for the Casper-Alcova project, there has been allocated to Wyoming only $20,000 for other purposes: There- fore oe it Resolved by the House of Representatives of the special session of the Twenty -second Legislature of Wyoming (the senate con- eurrir^). That we impress ufKm the Federal Emergency Adminis- tration of Public Works the great necessity of funds for these projects and the urgent need of a stifflcient supply of water to properly irrigate the lands wltlvln these projects, which can only be secured by the impounding of the flood waters of our streams, that we cmil upon the State aOclals and State advlsQcy board and January 11 ' state administration to use every effort on their part to secure he allocation of additional funds sufficient to provide for these )rojects; and be it further Resolved, That a copy of these resolutions be mailed to His Ex- rellency, the President of the United States, to the Federal Emergency Administration of Public Works, to the State advisory K)ard and State administration, and to each of our Representa- ives in the National Congress. OscAS Beck. President of the Senate. Wm. M. Jack, Speaker of the House. Approved 4:40 pjn. December 28. 1933. LzsLns A. Mn.i.KR, Governor. Mr. LA POLLETTE presented the following joint resolu- ion of the Legislature of the State of Wisconsin, which was ef erred to the Committee on Agriculture and Forestry: Statt of Wisconsin. Joint resolution relating to relief for the dairy Industry Whereas over $350,000,000 will be spent In corn and hog bonu.se8 iind approximately the same amount in wheat and cotton bo- :iuses; and Whereas Wisconsin will receive but $7,000,000 of this amount; imd Whereas there appears to be no relief in sight for the dairy ndustry; and Whereas, if the dairy industry was to receive treatment on the (lame basis as the wheat, cotton, and corn industries, Wisconsin vould be receiving approximately $65,000,000 instead of $7,000,000; iind Whereas the dairy Industry is In a serious condition: Now, herefore. be It Resolved by the assembly (the senate concurring). That the >partment of Agrlctilture. or Its Agricultural Adjustment Ad- nlnlstration. take vigoroiis measures to Initiate a program along ;he foUowing lines: 1. A production-control program that will bring dairy pro- luctlon somewhere nearly Into line with effective consumer lemand. 2. In connection with this basic program, a supplementary pro- gram that will tend to take existing surpluses of dairy products )ff the market and increase the price of dairy products to what- !ver extent effective consumer demand will permit. 3. A subsidiary program to check the imports of so-called ' manufactured " cream, vegetable oils, and casein, and an ade- ( luate Internal tax on all butter substitutes. Resolved further. That suitable copies of this resolution be orwardcd to Hon. Henry Wallace. Secretary of Agriculture, Wash- ngton, D.C.. to both Houses of the Congress of the United States, tnd to each Wisconsin Member thereof. Thomas J. O'Mallet, President of the Senate. R. A. Cobban, Chief Clerk of the Senate. C. Young, Speaker of the Assembly. John J. Sloccm. Chief Clerk of the Assembly. Mr. LA FOLLETTE also presented the following joint reso- utlon of the Legislature of the State of Wisconsin, which was referred to the Committee on Lnmigration: State of Wisconsin. lolnt resolution memorializing Congress to temporarily reduce or cancel the fees payable under the naturalization laws Whereas many persons in Wisconsin, as well as in other States, n'ho desire to become citizens of the United States, arc unable to ;ake the necessary steps for naturalization at this time because of nabiUty to pay the fees and expenses prescribed by the naturaliza- ;lon laws; and Whereas there are a large number of cases where declarations )f Intention have already been filed and the prescribed periods of ralidity for filing petitions for citizenship will have expired before ecovery from unemplo>inent. and many cases of persons unable to 3ay the required fees and expenses for filing a declaration of luten- ,lon; and Whereas the policy of the Federal and State Governments generally ;o relax, modify, or suspend normal requirements In favor of per- sons handicapped In the present economic emergency should be applied at least temp>orarlly to those seeking naturalization: Now, ;herefore, be it Resolved by the assembly (the senate concurring). Thai, this eglslature respectfully memorallzes the Congress of the United States to amend the naturalization laws by reducing or canceling ill naturalization fees and expen.ses until July 1. 1935, so that >er9ons who are otherwise qualified but who, under the present economic conditions, are unable to pay the prescribed fees and ;xpenses, may proceed with naturalization; also to so e.xtend any jrescrlbed periods of validity which have expired since July 1, 1983. that no naturalization rights will be lost or delayed since said late: be it further JAC rnMnPFRisiTnNAT. PRroRn — SENATE January 11 wiii«Jii was xcxciicu m\j lo-iv >xv»"*»"'vv»»« Forestry. r i^ci t«»o !*••*- f ■ the cost of production: Now, therefore, be It hereby 1934 CONGRESSIONAL RECORD— SENATE 406 Resolved, That suitably attested copies of this resolution be transmitted to the President of the United States and to each Member of Congress from th^is State. Thomas J. O'Maluct, President of the Senate. R. A. Cobban, Chief Clerk of the Senate. C. YOUNO. Speaker of the Assembly. John J. Slocom, C;iie/ Clerfc of the Assembly. Mr. LA POLLETTE also presented the following joint reso- lution of the Legislature of the State of Wisconsin, which was ordered to lie on the table: State or Wisconsin. Joint resolution memorializing the Congress of the United States to recognize the Federal Government's obligation to share equi- tably the proceeds of liquor taxes with the States, covmties, and cities, and to prevent intergovernmental competition in the field of liquor taxation through the adoption of the recommendations presented by the Interstate Commission on Conflicting Taxation with the authority of the Interstate assembly. Whereas there is grave danger that the anticipated benefits of repeal will be destroved by unrestrained and competitive taxation of alcoholic beverages by the Federal Government and by the governments of the States, counties, and cities: and Whereas the imposition by the Federal Government of taxes or other Imposts on alcoholic beverages without regard to similar burdens Imposed by the States, counties, and cities may result in a combined load of taxation so heavy as to encourage lUlclt traffic in the.se beverages; and Whereas before Federal prohibition the States, counties, and cities depended on liquor taxes and license fees for a substantial proportion of their tax revenues, thus lightening the load of taxa- tion on real property: and ^. ». # Whereas if liquor taxes are again to carry a reasonab e share or the State and local tax burden. It Is essential that the taxation of alcoholic beverages by the Federal Government be not ex- Whereas there Is grave danger that unless Immediate action is taken by the State«», counties, and cities In establishing a line of communication with the Federal Government through such bodies as the Interstate assembly and the Interstate Commission on Conflicting Taxation, the opportunity to secure a fair division of liquor tax revenues will be lost: Now, therefore, be it ^ Resolved by the assembly (the senate concurring). That Congress be urged to adopt the recommendations formuated by the Inter- state Commission on Conflicting Taxation at a meeting in Wash- ington D.C., November 10-11, 1933. and ratified by the Interstate assembly which provide that, of the combined gross revenues from the liquor traffic derived by the Federal and State Gov- ernments from all sources, one half should laure to the benefit of the States and their localities and the remaining half should be retained bv the Federal Government; be It further Resolved That the President of the United States be respect- fully urged and requested to approve any bill embodying the principles of the above recommendations In order that the pro- visions thereof may become effective at an early date; be It ^Resolved. That a properly attested copy of this resolution be sent to the President of the United States, the President of the Senate, the Speaker of the House of Representatives, and to each of the Members of the Congress from Wisconsin. Thomas J. O'Uaiajct. President of the Senate. R. A. Cobban. Chief Clerk of the Senate. C. Young. Speaker of the Assembly. John J. Slocum. Chief Clerk of the Assembly. Mr. SHIPSTEAD presented the following resolution of the House of Representatives of the Legislature of the State of Minnesota, which was ordered to lie on the table: Whereas It is generally believed by the people of Minnesota that the early development of the Great Lakes-St^ Lawrence deep waterways would be of Incalculable benefit to this State and the entire Northwest; and w^,„„ »t«.v*<»i if Whereas this much desired Improvement Is being retarded, u not blocked, by the power InteresU of New York State: There- ^^Resolved by the House of Representatives of the State of Minne- sota, That we caU upon our representative In the Congress to loin with aU proper forces in removing obstructions to the early Completion of th^ Great Lakes-St. Lawrence deep waterways; be "ie*oh"d. That copies of this resolution be forwarded to the entire delegation of Minnesota representatives ^ the Congress. Speaker of the House of Representatives. Passed the house of representotlves the 6th day of January 1934. Chief Clerk. House of Representatives. Mr. SHIPSTEAD also presented the following resolution of the House of Representatives of the Legislature of the State of Minnesota, which was referred to the Committee on the Judiciary: Whereas Tom Mooney and Warren K. Billings hare l>e«n in^- oerated In the prisons of Californl* for 17 jwn. taavtog been framed and convicted on perjured evidence: and Whereas the working class to the United 8Ute« and tlmnighout the world have continuously demonstrated U»elr unabAkoi faltn to the Innocence of these men. and their de*.ermlnatlon to can- Unue the mUltant mass stniggle to secure the UnmedlaU and unconditional release of Mooney and BllUngs; and Whereas numerous religious institutions and liberal organisa- tions have also demanded the freedom of Mooney and Bflllnga on the basis u « p^^ .y EOTMWBU, President. 1QQ/1 r.ONrjRF.RSTONAL REnORD— SENATE 407 CONGRESSIONAL E ECORD--SEN ATE 406 Th« PRXLAsaLnnA Conmxttcu — Orrora 8t. Lawskkcb Watsbwat XisATT— UaosMT. Act Immzsiatzi.t — Acnow or tm« PHU^msLrMXA Coirmufcs, Dscsmbui 18. 1933 THIS CANADIAN MSASVKZ WU-L DICCOUSACE AND MCrCAT IMCKTIAl. ftOjWCtS TO PmoMOTl COMMnCK AND KMPLOTMENT WtTMU* TK« VNTTSO STATSa The RhiUdelphlft conference of the Atlftntlc Deeper WaWrwmye AnBoriation. held »t the B#llenie-8tr»tford Hotel. PhlladelpbU. Pft.. December IS. unenimouely Mlopted reeolutlone oppoelnf ffttl- ficatlon by the United »Utee Senate of the Greet L*ke»'0t. Law- fence Wsterwiiy Treety end urged the allotment of Ovll Worka Administration funde to euch waterway projecu ae hare been recummeiiUMl by the •aeoelatlon and have received final approval of the Chief of Knctneere and the Secretary of War, l«ore than SOO delegates from the SUtee aloni the Atlantic sea- bonrd. snd from other Btatee. attended the conference, which was •dUresM-d by United SUtes Senators. Members of Con«reas. mayors, rapreeentativee of cltlea and towns, commercial and trade organlza- tlotu, and othera. The substance of the resolutions adopted by the conference U as follows: " Sesoivcd, That we oppoee the ratification of the Great Lakes- 8t. Lawrence Deep Waterway Treaty now pending before the United SUtee Senate and urge lU rejection by the Senate; and be tt further •• Metolved, That before any further consideration be given to the treaty that an economic survey be made by a governmental agency of the projects proposed therein. • •••••• " Resolved. That we reaffirm the several declarations and reaolu- ttotxs adopted at the last annual meeting of this association held in October last In the city of Baltimore, and be It further " Resolved. That such projects as have been recommended by this association and have received the final approval of the Chief of Engineers and Secretary of War should receive an allotment of funds from the Public Works Administration, and* we recommend aame to the favorable consideration of the Administrator of PubUc Works." Further, the conference requested the president of the Atlantic Deeper Waterways Association to appoint forthwith a special com- mittee to " vigorously and continuously ^ordinate and promote national opposition " to the Great Lakes-St. Lawrence Deep Water- way Treaty, to use " every legitimate means at Its disposal to give practical effect to this opposition ". to cooperate with others op- posing this treaty, and to demand the expenditure of United States money on United States projects. The undersigned committee was named. Congress meets on January 3. 1934. The treaty will be subject to action by the Senate inunedlately thereafter. Write your Senator and ask him to vote against ratification Urge your friends to do likewise. Point out the advantage ol giving employment to citizens of the United States on the projects within your State which this association ha« endorsed and which have the approval of the War Department. Tell them that the money you pay In taxes should be spent at home and not for the benefit of foreign shlpp>ers and foreign labor. Cooperate, whenever possible, with the members of the under- signed committee In getting the facts before the public. The time Is short. Do It now. Frank S. Davis. Boston. Mass.. chairman; Peter G. Ten Eyck, Albany. N.Y.; Capt. John P. Maglll. New York. NY.; G. H. Pouder. Baltimore. Md.; J. FUlmer Bright. Rich- mond. Va.; Walter H. Blair. Wilmington. N.C.: Harry G Barbee. Norfolk. Va.; John H. Small. Washington. D. C; Frederick W. Donnelly. Trenton. NJ., J. Hampton Moore. Philadelphia lex officio), special committee. OoMMrrncE Heaoquarti:](s. i40S Wuiener Building, Philadelphia, Pa.. December 28. 1933. RSAD AND Act at Once! — RBsottmoNS Oppostxo the St. Lawwknce Wate«wat T««att — Philadelphia Confekiince St. Lawsenci: Watsswat TaxATY — New Jebsxt Ship Canal and Atlantic Intsa- coastal Watxxwat, Decembeb 18. 1933 okeat lakcs-st. lawkenck watxrwat tbkatt Whereas we. more than 600 delegatee. representing the New England. Middle Atlantic, Southern, and Gulf States, the popula- tion of which represents two thirds of the entire population of the United States and more than 80 percent of its taxpayers, assembled in conference In the Bellevue-Stratford Hotel In Phila- delphia. Pa., on Monday. December 18. 1933. Indudii^ National and State legislators, mayors, industrial and trade crfBciala, com- mercial, civic, and service organizations, after due consideration and discussion, strenuously oppose the menace of the proposed Great Lakes-St. Lawrence Deep Waterway Treaty now pending for ratification before the United States Senate, and we oppoee as economic suicide the said ratification on patriotic and economic grounds, litcludtng the following: It proposes the construction of a new deep waterway route. 90 percent of which lies In Canada, and construction of hydro- electric power plants. 80 percent of which will reside tn and belong to Canada: to tntematlonallae Lake Michigan, now entirely an American lake, and to surrender our sovereignty over It; to have the United Btstee advance. In the first Instance, all the costs, amounting to possibly ooore than a billion dollars; to allow / CJenads to deduct from- her share of the expense the amount of aer expenditures for waterway Improvements heretofore made in ::;anada and denies to the United States similar credits for prac- tically all moneys expended in American territory; provides that aU improvements made In Canada (80 to 90 percent) shall be made with Canadian labor. Canadian materials, and by Canadian mgineers: favors the position of the Canadian wheat exporter in his keen competition with the American wheat furmer who U already handicapped by British prefrrentlal tarlffi: provides the means to divert the Orettt-L«»tei« tra/Dc whlrh now nncU its way to the Atlantic and the Gulf throujih American waterways and over American railroads to Canadlau ports by means of Canadian transportation fiiclMtles, all to the Injury and destruction of our own rail and waterway transportation facilities and to the injury alAO of Amerlcim Investors In our transporUtion enterprises and terminals: Therefore be It Retolvcd. That we oppose the ratlflcotlon of the Great Lakss- St. Lawrence Deep Waterway Treaty now pending before the United SUtes Senate and urge Its rejection by the Senate; and be tt further ilc«o/t«f. That before any further consideration be given to the treaty that an economic survey be made by a governmental agency of the projects proposed therein. If you oppose this un-American treaty, write your Senator Immediately. Respectfully. Frank S. Davis. Boston, Mass.. chairman: Peter G. Ten Eyck. Albany. NT.: Capt. John P. Maglll. New York. NY.; G. H. Pouder, Baltimore. Md.; J. Fulmcr Bright, Rich- mond, Va.: Walter H. BlaIr, Wilmington. N.C: Harry Q. Barbee. Norfolk. Va.; John H. Small. Washington, D.C.; Frederick W. Donnelly. Trenton, N.J.; J. Hampton Moore, Philadelphia, Pa. (ex officio), special committee. CoMMTrrss Headqu.abtcrs. 1405 Widener Building. Philadelphia. Pa. January 11 Atlantic Deepeb Watkrwats Association, P/itladelp/iia, January 2. 1934. Hon. Marctts A. Coolidgk. United States Senate. Washington, DC. Mt Dear Senator: I respectfully direct your attention to the enclosed circular letter, also copy of a resolution adopted at the conference held In Philadelphia on December 18. 1933. in opposi- tion to the ratification of the Great Lakes-St. Lawrence Deep Waterway Treaty. This association Is strenuously opposed to ratification at this time and believes that the funds to be spent by the United States on this project would serve a more useful purpose if used upon projects wholly within the United States. We invite your careful consideration of the matter and respect- fully urge you to vote against ratiflcatlon, since, among other things, the alleged benefits to be derived do not appear to justify the enormous cost. With best wishes, I am, very truly yours. J. H. Moore, President. BuKXAtr or Transportation and Public Service of the New Bedford Board of Com.merce, New Bedford, Mass., January 3. 1934. Re: Great Lakes-St. Lawrence Waterway Treaty. Hon. Marctts A. Coolidce, United States Senator, Senate Office Building, Washington, D.C. Mr Dear Senator: One of the most Important matters which will come before the United States Senate at the session of Con- gress opening today will be that of the ratlrtcation of the Great Lakes-St. Lawrence Waterway Treaty. The approval of the United States Senate to this treaty with Canada will result in a long step being talten forward toward the construction of a most expensive international waterway, the actual need of which is still most un- certain. Of very vital Importance to our country is the pos.sibility of great harm being done to New England and other sections of the United States by the construction of this International waterway. In a circular covering the resolutions opposing the Great Lakes- St. Lawrence waterway treaty, recently issued by a special com- mittee of the Atlantic Deeper Waterways Association, it is stated that: •* It proposes the construction of a new deep waterway route, 90 percent of which lies In Canada, and construction of hydro- electric power plants, 80 percent of which will reside In and be- long to Canada; to internationalize Lake Michigan, now entirely an American lake, and to surrender our sovereignty over It; to have the United States advance, in the first instance, all the costs, amounting to possibly more than a billion dollars: to allow Can- ada to deduct from her share of the expense the amount of her expenditures for waterway Improvements heretofore made In Can- ada, and denies to the United States similar credits for practically all moneys expended In American territory; provides that all im- provements made in Canada — 80 to 90 percent — shall be made with Canadian labor, Canadian materials, and by Canadian engineers: favors the position of the Canadian wheat exporter in his keen competition with the American wheat farmer who Is already handicapped by British preferential tariffs: provides the means to divert the Great Lakes traffic which now finds its way to the Atlantic and the Gulf through American waterways and over American railroads to Canadian ports by means of Canadian trans- JAO rONaRFRSTONAL I lECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 407 portatlon facilltlee: all to the injury and destruction of our own | rail and waterway transportation facilities and to the Injury, also, of American Investors In our transportation enterprises and terminals." If this portion of this sUtement of this association gives a true analysis of the facts, then it is time for our Reprrscnutlves in Congress to most strenuously oppose the further expenditure of public funds in foreign countries and for foreign needs. It is about time that the United States stop being used as a lamb for fleecing purposes by foreign countrlrn undnr the ur|e of ill- advised and untruthful propaganda disseminated throughout otir country by thoee having more than a pausing interest In such ^'tJiU letter U written In behalf of the New Ikdford Board of Commerce, an organiwitlon representing the rivlc, biulness, and industrial InteresU of the city of New Bedford, and the New England Traffic League, an organization of iraiuporiatlon men representing approximately 200 Industrlss and commercial organl- EStions of New England. Very reapecUully yours, A. H. FERorsoN, Manager Bureau of Transportation and Public Service: Chairman Executive Committee the New England Traffic League. Boston, January 9, 1934. Hon. Marcus A. Cooliooe, Senate, Washington, D.C. Mt Dear Senator: I would like to call your attention to the proposed ratification of the St. Lawrence River Treaty, which I assume will come before you during this session of Congress. We are very much opposed to the ratiflcatlon of this treaty until a proper Investigation is made on this whole subject, and we trust that you will see that the interests of New England are protected by opposing this treaty. Very truly yours, ^ Motor Truck Owners Service Bureau. Day Baker, Legislative Counsel. Lawrence, Mass.. January 8, 1934. Hon. Marcus A. Coolidge. United States Senate, Washington, D.C. Dear Senator Coolidoe: The directors of the Lawrence Chamber of Commerce unanimously voted opposition to the St. Lawrence Deep Waterway Treaty, and also that notice of this action be sent to our two United Scates Senators. From Information which the board of directors have at hand, the opposition to the treaty was based on the following: 1 The treaty should be given no further consideration until an official economic sxirvey has been made by a competent, unbiased United States commission and until it can be proved beyond doubt that there will be an adequate return on the gigantic Investment that would be required. 2. Ninety percent of the St. Lawrence River lies whoUy within 3. Ninety percent of the grain that might be exported through the St. Lawrence would be Canadian grain. 4. Ninety-eight percent of the ocean-going ships that would transport grain would be foreign bottoms. 5 Eighty percent of the waterpower capable of development would be Canadian; In order words, four of the five million horsepower which could be harnessed would be Canadian. 6. Sixty-six and two thirds percent of the new money Invested In this project would be United States money. 7 Therefore the project is 80 percent to 90 percent Canadian. while 662^3 percent of the new money would be paid by the United 8. This proposed waterway could only be operated 7 months of the year, at best. ^ .... * ». 9 Expert engineers and analysts of international reputation certify that the cost of this project would be more than double the estimates. ^ „ ^ ^ t .. 10. The treaty would make the United States surrender Lake Michigan and make it an International lake. 11 The treaty In article VIII does not provide sufficient water diversion for the Chicago Drainage Canal or for the Mississippi River channel. , ^ ,_. . ^ » » 12 The western farmer has been told he would be saved 8 to 10 cents a bushel on grain transportation, while the present rate is only about 414 cents from Duluth and Port William to Montreal. ^ ,^^ ^. _,_ 13 The total cost of the power developed with the construc- tion of trunk-line transmission lines, rights-of-way. etc., would be so great that the power could not compete with established power companies, when the taxes the citizens wUl have to pay on the development are taken Into consideration. 14 The United States Department of Commerce. In a purported economic survey dated 1926, states In Its report that no attempt has been made to determine the amount of traffic which would actually move over this proposed canal or the total amoxint of savings that might result. ^. ^ ^ 15 There are scores of other unanswerable facts which have been presented to the United States Senate as to why the treaty should not be ratified, which prove that this uneconomic. Im- practical propoeiUon should not be allowed to load this gigantic financial burden on the taxpayers, particularly at a time like this, and that the project would not help unemployment in this country, as the majority of those ngfA on the work would, under the treaty, be Canadian engineers and labor, and a larf* percentage of the work wotild be done by machinery. 18. This project would, in no way. fire immcdiaU relief to the present-day unemployment, which the earns money spent else- where would do. _ . . We believe in United SUtes money for United ttates proj- ecU wholly within the United SUtee, and to bt taead for the employment of United SUtes labor. It appears to the board of direetors from the forsffolnc that the proposed St, Uwrenee Treaty la undoubtedly farorabte u Canada and that before final action Is taksn on thli treaty, thorough study and inveettgatlon should be made before com- mlttlng thu Nation to a treaty which does not appear to be equiubls. In accordance with this sentiment, the dlreetors of the Lawrence Chamber of Commerce earnestly lequeet you to op- pose the ratification of the propossd St. Lawrenee Treaty. Very truly yoxirs, LAWRUtca .Chambbs or CoMMnoB. JoHM J. O'Botnuii, Secretary. JaMVABT 9. 1M4. Hon. Marctts A. CooLnxm, United States Senate, Waehington, DX3. Dear Mr. Coolidce; Among the agenda for the next year pro- posed to scm.' of the New Bngland commercial bodies Is the following : " Opposition to ratification of St. Lawrence waterway as an enterprise adversely affecting New England." I beg leave to question the correctness of this assumption. ' The Interests of New England are not opposed to the InUresi* of the country at large, nor can New England escape the reper- cussion of any great and lasting injurj' Buffered by any region of our country, much less can It escape the result of any injury suffered by the region to which transporUtion Is furnished by the Great Lakes. That region with lU numerous cities, running from Lake Ontario to the heads of Lakes Michigan and Superior, has a natural outlet to the ocean, ending with the St. Lawrence Valley. All but a short section of this ouUet has already been Improved for navigation by large ooean-golng vessels. The present is a time when this waterway can be completed to advantage owing to the need of starting public worlts for furnishing employmsnt. In addition to its great agricultural interest, that region is especially adapted to heavy Industries. It therefore has especial need for the cheap water transportation which completion of the St. Lawrence Valley improvement would afford. These industries can be multiplied and greatly developed by means of such facilities. The population that can be so supported is naturally trlbuUry to the textile and other industries on which New England de- pends. The two regions supplement each other. The prosperity of that region under the same tariff will mean prosperity to New England In countless ways, through demand for New England products. Injury to that region will work corre- sponding injury to New England. Even from the most narrow and sordid point of view. New Eng- land cannot afford to throttle the natural outlet of this great region to the sea by asking Its Senators to take advantage of the two-thirds vote required for treaty ratification on which com- pletion of the waterway depends. There are, however, additional reasons why this so-called " Inter- est" in stopping this outlet should not be Invoked by those who may think that for the Immediate present there may be something in It. What kind of a country are we going to have if the vital and lasting advantages of one region are to be sacrificed to the small advantage of another? Are we to be a nation of people helping and standing by one another, or a collection of parochial-minded sections Jealously competing In mutual strangulation? What would New England have thought If the lake region and the upper Mississippi Valley had opposed the Panama Canal, on the ground that It would give the Atlantic seacoast an advantage over them In commerce with the Pacific coast, as it has? What kind of a standing will New England have when some of Its own Interests are at stake in Washington, as they frequently are in tariff and other matters. If its commercial bodies and iU Representatives have Inaugurated such a narrow and selfish policy of mutual injury? ^». * w Are we to expect the utmost consideration from those to whom we have a lasting and grattiltous Injury at a time when pubUc works at no profit at all are being undertaken for the mere em- ployment of the Idle? FTom no point of view, either broad or narrow, selflfih or un- selfish, is It to the interest of New England to shut off the basin of the Great Lakes from access to the sea? Very truly yours, „ .. « ' R. M. Bradlet. RESOLUTIONS or THK HATIOHAL TARMEHS' tmiOM Mr. CAPPER. Mr. President, I ask unanlmouB consent to have printed in the Record a copy of the resolutions adopted by the National Fanners' Union at its annual con- venUon. held in Omaha. Nebr.. November 20. 21, and 22. 1933. 1934 CONGRESSIONAL RECORD— SENATE 409 tbe Unltedi Otatw MVAiioe. In the nxst instance, all the costs. amouattag to poaalblj more than a blUlon dollars; to allow / Atlantic and the Gulf through American waterways and over American railroads to Canadian ports by means of Canadian trana- 408 CONGRESSIONAL I :ECORI>—SEN ATE The Farmers* Union te one of our great national farm organizations, and Its program is worthy of the careful at- tention of every Member of the Senate. For myself, I want to say that I am in entire sympathy with the ptirpoees of the Farmers' Union, and in a general way find myself in accord with nearly all of the program. I would especially urge Senators to notice the strong en- dorsement given the so-caUed " Frazier bill " providing the refinancing of farm mortgages at a rate of S-percent interest. Another part of their program calls for the repeal of the Federal tax of 1 cent a gallon on gasoline. Farmers are among the largest purchasers of gasoline, and are heavily hit by this tax. which in my Judgment should be allowed to the States for highway purposes only. I have introduced a bill to repeal this tax. and hope to see it passed at this session. The Farmers' Union also calls upon Congress, and rightly. to "pass such legislation as would, absolutely. i«-ohibit gambling in farm products by boards of trade, cotton ex- changes, and other speculators." • I most heartily endorse that plank In their platform of needed legislation, and have introduced a bill to accomplish that purpose. Mr. President. I send to the desk the resolutions adopted by the National Farmers' Union, and ask that they be printed in the Rbcoko as a part of my remarks, and appro- priately referred. There being no objection, the resolutions were referred to the Committee on Agriculture and Forestry and ordered to be lurinted in the Rkcord, as follows: JTATIONAI. FAUCKBa' TTWIOW PBOGKAM. ADOFITD UHAICmO'aSI.T IW AinraAX. ooirrsirnoif rslo ik omaba. nxbe., wovxmbib ao, si, aa, itaa I. The Ftader bill, providing for the OoTemment's reftnanclng farmers at a rate of 1>4 -percent Interest. a. The Swank-Thomaa bill, providing for Government regulation of the marketing of farm cropa on a basis of the f sumer receiving for that portion of his crop needed for domestic consumption a prloe of not leas than cost of production. Including a reasonable profit. 5. The Wheeler bill, providing for the remonetlzation of silver. 4. The Thomas bill, which provides for the Oovemment issuing full legal-tender, non-lnterest-bearlng currency to pay the debU of the Katlon instead of Issuing more Interest-bearing bonds. 6. We believe all taxaUon should be based on ability to pay , We further believe there Is just one test of ability to pay, and that la net income at the end of the year. We therefore support such rates on net incomes as will pay the ruxuiing expenses of govern- ment. We reallas Chat the concentration of wealth in the hands of a few to the extent that today In the United States leae than 5 percent of the people own 00 percent of the wealth of the Nation is a menace to the Ufe of the Nation. Hl8t(»7 teaches from Babylon to Russia that where such conditions exist one of two things happen* — either there Is redistribution of wealth or revolu- tion and overthrow of the government. To prevent the latter the Farmers' Union proposes such amend- ments to the inhwltance and gifts tax law as will limit the amoiuit an individual can take from an estate to one half million dollars. 6. We are oppoeed to the large appropriations being made in preparation for war. ror 40 years this Nation has preached peace while at the same time tpcndlng more money every year on wars — past, present, and futuf« — than any other country tn the world. It Is our position that such a pottey Is hypocritical and inconsistent. We are also unalterably opposed to compulsory military training in any form, and eq;>eclaUy in tax-supported institutions of learning. T. Faman are the largest purchasers of gasoline of any group, bene* the largest payers of gasoline taxes. We are cf^wsed to the federal taxae on gasoline and to the diversion of tax funds raised toy the vartotis States from road building and maintenance purposes. 8. We believe Oongrets should pass svich legislation as would absolutely pttdUbtt gambling in farm products by boards of trade. ootton esohangea. and other speculators. 9. It is our position thst so long as Industry Is fstitected by tariff, agriculture is entitled to the same protection. 10. We urge the next session of Congress to pass such legislation as wlU give the Philippines Inunediate and absolute Independence. II. We favor further and more effective legislation against the use of ormtal alls in the maniifacture of oleonoargarlne. Such tegislstlon Is nasrtsci to protect the dairy farmers endent packing-plant stockyards and all other livestock markets where as many as 1,000 head of livestock is sold dally. That a copy of this demand be wired President F. D. Roosevelt. REPOBTS OF THE CLAIMS COMMITTEE Mr. LOGAN, from the Committee on Claims, to which was referred the bill (S. 1321) authorizing adjustment of the claim of Korber Realty, Inc., reported it without amend- ment and submitted a report (No. 177) thereon. He also, from the same committee, to which was referred the bill Tr'CcmxT A T T?T?PnPn .QFVATP. jAlVrTTARV 11 ■ICkQA rONnRFSSTONAL RErORD — SENATE 41S conuitilng an Itemized •tatemcnt of nerearur .UDmil lo me i^inxvur u* ^'j'-^j^J^^^jJ^" J7J"^.'-';^ RECORD through. IT they WWe UOl prmieo m UM K.K»» 412 CONGRESSIONAL \ RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD^— SENATE 418 of yesterday. I ask to have the minority (H;>iziion prlntid also. I want the entire record printed. Mr. GORE. I wish tc suggest, if the Senator does ait object, that I should like to include in the document the dec sion in the case of Townsend against Townsend, In Plrit Peck, a Tennessee case, decided in 1821. I will not insist the Senator objects. The VICE PRESIDENT. Is there objection to the requ* of the Senator from Minnesota? The Chair hears none, it is so ordered. Mr. GORE. Mr. President, I ask at this point that exi from the decision in the case of Townsend against To^ send, to which I have referred, and also an extract from case of Johnson v. Dtmcan A Al.'s Syndics. (3 Martin's Rept.), a Louisiana case decided in 1815. both of which will furnish, may be printed in the Congrkssiohal RECokn and also printed as a Senate document. It will be interest- ing to every Senator. The VICE PRESIDENT. Is there objection? Tlie Chair hears none, and it Is so ordered. Mr. GORE subsequently said: Mr. President. I have coi- f erred with the Senator from Minnesota [Mr. Shipsteai ]. He does not object to the extracts from opinions to which I referred and has consented to have them included in t!ie document which he asked to have printed a few momerts ago. The VICE PRESIDENT. Without objection, the doci- ment referred to will Include the matter suggested by tie Senator from Oklahoma. Mr. GORE. Mr. President. I now ask unanimous consent that 2 or 3 pages tram the Life of Washington by Join Marshall may be printed in the Record and in the Senate document authorized pursuant to the request of the Senator from Minnesota a moment ago. The VICE PRESIDENT. The Senator from Oklahoma i e- quests modification of the unanimous consent granted a few moments ago at the request of the Senator from Minnascta [Mr. Shipstead] to Include 2 or 3 pages from the Life of George Washington by Chief Justice Marshall. Mr. GORE. It is 2 or 3 pages taken from the Life of George Washington by John Marshall relating to the saiae subject. The VICE PRESIDENT. Is there objection to the mofi- flcation? Mr. SHIPSTEAD. Mr. President, on account of the c fusion I did not hear the request of the Senator from Ok boma. Will he please state it again? Mr. GORE. I am requesting that there be added to document, authorized a few moments ago at the instance the Senator from Minnesota. 2 or 3 pages from the Life George Washington written by John Marshall pertaining the same subject. I am sure It will be very illiunlnating. Mr. SHIPSTEAD. I have no objection. The VICE PRESIDENT. Without objection. It is so ordered. The extract and opinion ordered printed in the Record Ion request of Vx. Gori are as follows: (Prom "Lif* of Waahington " by Chief Juatloe Marahall] The dlacontonU and uneaatneas. arlatng In a great meaaure ttbm the embarraaamenu m which a cotuiderable number at ixuUvldu alii were Involved, continued to become more extenalve. At len( th two great partiea were formed in every State, which were c l«- ttnetly nuulced. and which pxiraued dlatlnct objecta. with ayatetu •tic arraagemant. The one struggled with unabated aeal for the exact obaervaj ice of public and private engagements. By thone belonging to It he faith of a nation or of a private man wm deemed a sacred plee alleviated only by industry and frugal ty. not by a reUucatlon of the laws or by a aacrtflce of the rights of others. According to the stern principles laid down for tlielr government the Imprudent and idle could not be protected by he uRSlalature from the connequences of their Indiscretion, but aho< Ud be restrained from involving themselves In diflkrolUea by the c(in vlcUon that a rigid compliance with contracts would be anforc rd. Tt\ey were consequently the uniform friendM of a regular adm n- IttjnatloQ of justice and of a vigorous course of taxation wh ch woukl anabl* the State to con^>ly with lu cngagementa. B; ' natural of Ideas they were also, with ? ary few «xc ip- tlons. In favor of enlarging the powers of the Federal Government and of enabling it to protect the dignity and character of the Nation abroad and its interests at home. The other party marked out for Itself a more indulgent course. Viewing with extreme tenderness the case of the debtor, their efforts were unceasingly directed to hie relief. To exact a faithful compliance with con- tracts was, in their opinion, a measure too harsh to be insisted on and was one which the people would not bear. They were uni- formly in favor of relaxing the administration of Justice, of afTord- ing facilities for the payment of debts or of suspending tneir col- lection, and of remitting taxes. The same course of opinion led them to resist every attempt to transfer from their own hands Into those of Congress powers which by others were deemed essen- tial to the preservation of the Union. In many of the States the party last mentioned constituted a decided majority of the people; and in all of tfcem It was very powerful. The emission of paper money, the delay of legal proceedings, and the suspension of the collection erf taree were the fruits of their rule wherever they were completely dominant. Even where they failed in carrying their measures, their strength was such as to encourage the hope of succeeding In a future attempt, and annual elections held forth to them the prospect of speedily repairing the loss of s favorite question. Throughout the Union the contest between these parties wiis periodically revived, and the public mind was perpetually agitated with hopes and fears on subjects which essentially affected the fortunes of a considerable proportion of the society. These contests were the more animated, because. In the State governments geaerally, no principle had been introduced which could resist the wild projects of the moment, give the people an opportunity to reflect, and allow the good sense of the Nation time for exertion. This uncertainty with respect to meastires or great importance to overy membei of the community, this Instability in principles which ought if possible to be rendered Immutable, produced a long train of ills, and is seriously believed to have been among the operating causes of those pecuniary eir.bcirrassmenta which at that time were so general as to influence tiie legisiailon of almost ever>' State in the Union. Its direct consequence was the loss of confidence in the Government, and in individuals. This, so far as respected the Government, was peculiarly discernible in the value of State debts. • •••••• The prospect of exti^ating the country from these embarrass- ments was by no means flattering. Whilst everything else fluc- tuated, some of the causes which produced this calamitous state of things were permanent. The hope and fear still remained tliat the debtor party would obtain the victory at the elections; and Instead of making the painful effort to obteln relief by industry and economy, many rested all their hopes on legislative inter- ference. The mass of national labor and of national wealth was consequently diminished. In every quarter were found those who asserted it to be impossible for the people to pay their public or private debts; and in some instances threats were uttered of suspending the administration of Justice by private violence. By the enlightened friends of republican government, this gloomy state of things was viewed with Infinite chagrin: and many became apprehensive that those plans from which so much happi- ness to the himian race had Ijeen anticipated, would produce only real misery, and would maintain but a short and a turbulent existence. Meanwhile, the wise and thinking part of the com- munity, who could trace evils to their source, labored unceasingly to inculcate opinioris favorable to the incorporation of some principles into the political system, which might correct the ob- vious vices without endangering the free spirit of the existing Instltutloris. [Prom Opinion of the Court In Johnson v. Duncan A Al.'t Syndics (3 Martins La. Repts ) | The obligation of contracts consists In the necessity under which a man finds himself to do, or refrain from doing, something. This obligation exists generally both in foro legls and in foro con- scientiae. though It does at times exist in one of these only. It is certainly of the first, that In foro legls, which the framers of the Constitution spoke when they prohibited the piMsage of any law Impairing the obligations of contracts. Now, a law absolutely recalling the power which the creditor enjoys of compilling his debtor In foro legls to perform the obligation of his contract would be a law dpntroylng the obligation of the contract In foro legls. Since a right, without a leKal remedy, ceases to be a legal right, It would impair the obligation of the contract by destroying Its legal obligation; In other wordu, by reducing an obligation both In foro legls and In foro conscienttae to an obligation In foro con- scientlae only — a legal and moral right to a moral right only. The remedy In foro legls. coast iiu ting the legal right of the creditor, constitutes also its correlative, the legal duty or obligation of the debtor; and a law which reduces a legal to a moral obligation Is one which in foro legls de-^troys the obligation. It appearH, there- fore, to me incorrect to say that the legislature may effectually do. as to the remedy or effect of the obligation, that which it can- not do as to the right; and I conclude that a law destroying or Impairing the remedy in as unconstitutional as one affecting the right In the same manner; for in foro legls the effects of both laws must be the same. Likewise a law procra'^tinatlng the remedy, generally speaking, destroys part of the right. He pays less who pays later. Minus solvit qui sorius solvit Neither le the procrastination properly comi>enaat«d by the allowance of interest In the meanwhile. To many men In many dnnimstances there Is a wide difference be- tween »100 payable today and »106 payable In a twelvemonth, whatever may be the certainty that no disappointment will occur; and in many cases the delay Is likely to be productive of consid- erable danger to the solvability of the debtor. Any Indulgence, therefore, In point of time, afforded by the legislature to the debtor Is a correlative injury to the creditor In the same degree, though of a different nature, as a ccHTSspondent Indulgence by a propor- tionate reduction of the debt. That such were the Impressions of the framers of the Constitu- tion will appear, If In expounding that Instrument, we foUow the nOes laid down for the exposition of statutee — If we consider the old law, the mischief and the remedy. The charter of our Federal rights was framed not many years after the termination of the war which secured our Independence. The disasters attending the arduous conflict had disabled mf.ny an honest individual from punctually discharging hU obligations; and the legislature of some of the States, more attentive to afford Immediate and temporary relief than a more remote and lasting one, by a sacred regard foi good faith and the consequent preser- vation of credit, pused laws meliorating the condition of debtors to the injury and ruin of creditors. In one State an emission of paper money, for the redemption of which no day was fixed nor any fvmd provided, was made a legal tender. In other words, an obligation to pay gold and silver was impaired by being re- duced to an oblgatlon to pay irredeemable paper, elsewhere a similar obligation was impaired by being reduced to an obligation to deliver a tract of pine barren land, or an installment law was passed and an obligation to pay today was impaired by being reduced to an obligation to pay at several periods, at the distance of intervening years. Such was the old law. The consequent diminution of the fortunes of several Individuals, the total ruin of others, and the Indispensable concomitant, the destruction of credit, produced a stagnation of business, which considerably af- fected public and private prosperity, such was the mischief. The Federal compact provided that the legislature of no State should retain the power of making anything but gold and silver a tender in the discharge of debts In order to avert In future the mischiefs resulting from laws impairing the obligation of a con- tract to pay gold and silver by reducing it to an obligation to pay paper, pine barren land, or, indeed, anything but gold and silver. Yet the remedy was not commensurate with the evil; the healing process was, therefore, continued in order to prevent the passage of laws impairing the obligation of a contract to pay today by reducing It to an obligation to pay on a distant day or days; or, indeed, any attempt at a legislative Interference between parties to a contract by favoring either party to the Injury of the other; and It was provided that no State should pass any law Im- pairing the obligations of contracts. If the restriction from mak- ing anything but gold and silver a tender In the payment of debts had not preceded that from passing any law impairing the obliga- tion of contracts, there might be some, though very little, ground to say that the latter clause would have been satisfied by restrain- ing the passage of laws authorizing the payment of one thing Instead of another. I therelore find no dlflVctilty In concluding that an act of a State legislature, the obvious object of which is to relieve debtors by postponing the recovery, and consequently the payment of debts, impairs the obligation of contracts, and as such Is tmcon- Btltutional, and the court Is bound to disregard It. whatever may be the hard necessity which. In the opinion of those who exercise the legulatlve powers of the Bute, appeared to require that they should come to the aid of their siifferlng Mlow cltlaena. Plat Justltia, mat eoelum. • • • e e • • TOWMSBMB V. TOWWIfP AMD OTHBU <1 FBCX'S, TKBTir. sm.) Article I. section 10, of the Constitution of the United Btates was Incorporated In that Instrument to prevent a rectirrence of the mischiefs arUlng from paper money and tender laws under the colonial government and up to the formation of the Federal Con- stitution. History of p^^er money and tender lawi parallel be- tween the present paper system and endorsement laws, and the system anterior to the formation of the Federal Constitution. The writ of execution, even considered as a new created right br which to enforce contracts, mtist not. under section 10, article I, of the Constitution, be so ordered on condition as to compel • creditor to lose hU security to have the benefit thereof. If the right to have execution was antecedent, suspension Is an unconstitutional penalty; If newly created, the condition Is uncon- stitutional and the right vests absolutely. Law Is the source of obligation, and the law at the time deflnee the extent of It; if the law In being at the time a contract Is made gives an equivalent in money and a subsequent law pro- vides that the equivalent shall not be In money, such law would Impair the obligation of the contract; so. If a law at the date of a contract give Immediate execution on a Judgment and a subse- quent law suspend It for 3 years, the contract is impaired. The regulation of contracts by law mtist go before, not after, such con- tracts are made. The mode of redress may be altered, but, as regards antecedent contracts, must not be rendered less efficacious than waa the law when the contract was made. Our Constitution, article n. section 7, "all courts ahaU be open ". etc relates to every poeslble injury a man may sustain, and Includes the right to demand execution of a contract; to withhold performance Is an injury to him in his goods and chat- tels, for he shall have " right and Justice without sale, denial, at delay." In Magna CarU thla operate* on royal power, in our country on leglalfttlve and every other power; every leglalature and court la bound to aay " let right and justice be administered without sale, denial, or delay." Justice la the end and right the mean whereby we may attain the end, which la the Uw. The mean U original and Judicial procese. and theee must go. when demanded. without aale, denial, or delay. Therefore, the act of 1819, chH»ter 19. suspending the execuUon upon all Judgments thereaftw to be obtained for 2 years, unlees the plaintiff wlU endorse that hank notes wlU be received In discharge. Is unooosUtutUmal and void. The act of 1819. ch^ter 19, dlreeta that ttpon any Judgment thereafter to be obtained, execution shall not Issue untU 9 year* after the rendition of such Judgment, unlees the plaintiff shall endorse tq>on the execuuoo. that the aherlff or other oOeer thaXL and may receive. In aatlsfactlon of said eaeetitlon. notee on the State bank of Tenneaeee and lU branchaa. and the NaalivlUe bank and branchee, or any of them, and such other notee as pas* at par with them. etc. The aame or a slmUar provision Is made by a law ot 1880 for forming a new bank and for loaning out the moneys that It may Issue. These acts of the leglslatture are tu-ged to be uneonsUtu- tional and void. And various clauses of the State eonstltutloa and of the Constitution of the United SUtes are said to be in direct repugnance to theee acta; and if so, it U well to admit in the outset that the acta, like every other act whose basts Is authority, are void If the authority be not given. We wlU take up these several clauses one after another and examine each in its turn to discover whether the acts In question are really uncon- stitutional as they are alleged to be. First, then, let us take Into consideration article I. section 10. of the Constitution of the United States, " No State shaU, etc., emit bills of credit or make anything but gold and silver coin a tender in payment of debts, pass any, etc.. ex post facto law or law Im- palrmg the obligation of contracts ". etc. The two first sentences respect tender laws and paper money; the construction to be put on them should repress and prevent the evils they were In- tended to obviate; and what these are mtist be understood by the actxial evils which paper money and tender laws produced In the time of the Colonial governments In time of the War of the Revolution and after that war, before the adoption of the Consti- tution of the United SUtes: and also tty the effects which these clauses produced after the adoption of the Constitution; and then by considering what will be the effect of the act of assembly now under contemplation, should the same be deemed valid, we shall be able to discover whether these effects are the ones Intended to be prevented by the clauaes of the Constitution In question. What, then. Is the history of paper money and tender laws under the Colonial governments? North Carolina lasued paper money. In 1718, £8,000. and the money depreciated. The lords proprietors would not receive It for qtilt rents, though Issued to defray the expensee of the Tuscarora War. It could not be remitted to Eng- land, they said; at the same time peltry was received by them. The next North Carolina emission was In 1723. £1,200; the next in 1729, £40.000; the next in 1734. £1,000; Treasury notes in 1756. 1767, 1758. and 1750; one emission In f760, of £134)00: one in 1761, of £30,000; one In 1771, of £60,000, to defray the expenses of sup- pressing the regulators. At this time there was already afloat £75.000. In 1739 the money depreciated and could never be raised to Its original value. In 1780 the depreciation wm three and a half for one; In 1785 It was five for one; In 1739 It was seven and a half for one; In 1740 It was received In payment for taxes, at the rate of seven and a hatf for one. and thus the Government redeemed and got clear of it. The Tteaeiuy notes depreciated. There is no instance of paper money which did not depreciate, let the pUn for sustaining Its credit be of whatever description It might. Paper money, in the time of the Colonial governments. was issued in most of the provlDoes. and In some of them depreci- ated more than It did in Ifortb Carolina. The attempt was made In liasaachueette to issue bank btlle. loaning them otit on interest and on real and pcreonal security, to be redeemed gradually, by the payment from the borrowers at one twelfth, making the bins a tender, and the rcfttaal of tbcm. to Incur the loss at this debt. Thee* provisions did not delajr the depreciation for one insUnt. The rate of exchange In the flrat yetf was 150 and In the second 900 perocDt. In 1790 MMsaehu- setts, Rhode Island, and Connecticut bad Issued paper money. Zt depreciated. There was an Immense quantltjr afloat; but the neopl* still clamored for more. ICaaMchusette and New HaoiMbire warn restrained from f tuther emlMlons by royal Instructions to th* governors. Rhode Island could not be re*traln*d, bcoauee she eho** b*r own governor; and she Issued tlOOXXW. It Instantty depreciated from 19 to 37 shillings jwr ounoe silver, th* foroMr being the settled valud, before the emission. In 1741. In Massachusetts, the paper money beliw about to be redeemed by gold and silver, remitted from Bnaland to re- imburse the Colonies for the exertions made In the late war above her quoU, an apprehension of the scarcity of money and coneeqtient distress of individuals, excited a great uneasiness in theMlony; a bank was forthwith proposed to supply the plaoe of the paper money thus to bs red**m*d. Rvcry borrower was to nMntcas* a real eeUte in proportion to the sums he should take froni ^ bank, or at hU option, five personal security when the sum should exceed £100, to pay annually 8 peroent on the sum burrowed, and 4 peroent of the principal. To prevent the fen- ml ooofUBlon whldi waa anticipated from this inetttutkm. the PszUameat Interfered and suppressed the «»mp^- Tta „**■•- •ftohuaoCU cumncy wm redaaoMd at th* rat* of 80 ihllUngB 414 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 415 would natural Vbm State to comply with Its mgugaamatt. ot kl«M Umjt were aleo. wlUt very lew B- «Kc ip- t comsMiuated by tlie allowance of intereet In th» meaawhile. a Bolvlt qui scrlus solvit Neither le the procrastination propeny >- 1 comDeDsated by tlie allowance of intereet In th» meaawhile. To tele, for bTehaU bare " rlfht and Juetlce without eale. denial, or FeillMagt ^^^J^^ ftt tb« nt* of flO Atmiagi 414 CONGRESSIONAL and Wi£ £U0 . al In currerwy emlBBioi s mi. 178 8. ner ounce of ellter. instead of 19 shillings per ounce, the rate at which It was iMiued. At this time, the popuUr leaders wra c using their best endeavors to make further emissions. In I7i| Pennsylvania Issued paper money accompanied with penalU enacted agaln«t those who made any difference in the jnice their goods, when sold for paper and when sold for gold ' •U»er. Notwithstanding this regulation. £130 of the paper only equal in the course ol exchange with Great Britain to •terllng and In some of the Colonies. £100 sterling was equal value to £1.100 currency. Such was the sUte of the '^'"•^ before the Revolution. Duiing the Revolutionary War were made from Ume to tin^e. DepreciaUon began in March at one and a quarter for one. and progressed to January when It was 800 for one: and as if aahamed of their own ioee credit, the notes allenUy withdrew from circulation. After the war of the Hevolutioti was ended in 17«3. the Assemb y emitted in North Carolina £100.000. and in 1786. they made ~ other emission to the same amount. The uniform fate <"^ emissions was depreciation. The emission of l'M3- „»n^''°*^^ Carolina depreciated from 8 to 10 shillings, and then 12 shlllini ^ per dollar The new emimlon of 1785 still further depreclaUd to 14 16 and 18 shiUiogs per dollar, instead of continuing at 8 ahllllnga per dollar; but returned and aetUed at 10 on the adoptK n trf the Constitution of the United Statee in 1789. and so it h* •ver since remained In tt»e debates In the convention of North Carolina upon the paper money and tender laws, it was stated papn in Rhode Island had depreciated eight for one, and 100 cent or 1« ahlUings per cloUar in North Carolina. It was stated that Pennsylvania liad issued paper money but had made It a tender, that in South Carolina their biUs were a tend< r •s was also the paper money In Rhode Island. New York. N«w Jersey, and North Carolina It was further stated that in Soufh Carolina laws had been paiaed to pay debts with land, and, calling them pine barrens. It is Implied with such land as debtor might choose to olfer. And farther, it wae sUted. they had oedered debts Ui be paid by installments. One caiiae of depredaticn is that the paper could not be mitted to foreign oountri«>. No matter how small the emis may be, it Is not equal to gold arul sUver. He who exchanges lor gold and silver must give a greater quantity of paper, expense of searching for and finding the silver, of proctiring exchange and of getting it to the place of exporUtion, togeths: with the risk of oonveyanoe and the greater danger of bav**' ths paper money counterfeited, are all considered and involved fixing the difference of value and contribute to the Increase deprecUtlon. U the paper money cannot be redeemed UU -^ years hence, that becomas another cavtse of depreciation. It he alleviated by an accrual of Interest for the delay, but it nevertheleas depreciate from this cause in conjunction with One hundred pounds in gold and silver U better than bearing Interest payable at the end oS 10 years, although it then be certainly paid: Because a present and pressing dei which cannot be extinguished but by gold and silver makes eligible sometimes to give a greater premium than the int— rather th#" abide the consequences of nonpayment. And It ^^f the notes and a premium besides to procure the £100 perhaps a merchant wants to pay a foreign creditor who called for payment. Another cause of depreclaUon is the power in the legislatvu-e repeat emissions at pleasure. For hence arises the Just apple hension that repeated emissions will be resorted to. Kqwriecce proves that paper money will be issued whenever the cry can a raised of general and public distress and can cause an applka tlon to be made for relief. With respect to the disorders produced by paper money tender laws, both theory and experience present them to v Who wlU be so Imprudent as to give credit to the citizens of State that makes paper money a tender and where he can told, take for a gold and silver debt depreciated paper, deprecl- 1 Ing still more in the moment It is paid? Who would trust '^ value of hts property to the clttrens of another State or of own State who can be protected by law against the Just dexiui: of credttors by forcing them to receive depreciated paper or be delayed of payment from year to year until the leglslat will no longer Interfere? Had he not better go to other marl beyond the limits of the State to dispose of his surplus prod\ c tlonst Or had he not better refrain from making any such "i" pJus productions rather than be compelled to receive from purchasers of them less than one half the value agreed to be for them? Had he not better remove to another country ^ ^ good faith ts preeervcd. with all his property, and there accunr u late the rewards of his indiistry rather than be continually *- prlved of a great part of them here to suit the convenience the purchaser? Would it not be better for a foreign state wh elttaeas are thus injured to use vlolenoe and make reprisil rather than suffer snch injustice? If sueh are the evils which theory would lead us to anticipate they aiw not lees formidable under the test at experience. De-^' dated papev prevrnted equal contributions fraa the States to general — of the Nation. New York, for Instance. ^mtttmM bUlB of credit. In them her quota wae payable, and deprectatlan of inferior value to the quota of oAher States Bonay wae not depredated, though the quotas of the latter of much smaller denomination. Impressions had been made the publle nMnUs by depreciated paper. Purchasers on credit ' ' ^ mat gains from depreciation, extensive purebaeee Se. and at length the hopes of the purchasers were — ' " numbers of the people were found to owe un^w, | thkt per- alio n>t from t\e thU rs- emissK >n it Tke tie hsr lJ« n 3f aooe miiy wJl othei 8. £1 W wll demand It interdst will wbli;h to ae Dep-e Ihe had by whsre on Mad tad disip- datts, RECORD— SENATE January 11 which they were unable to pay; a general discontent ensued with the course of trade, petitions were made for relief; embarrassments dally became more extensive, and two parties were formed. One struggling for the observance of public and private engagements and for the relief of Individual distress, they urged recourse to frugality and Industry, and that the Idle should not be protected by the legislature from the consequence of their indiscretion and should be restrained from Involving themselves In difficulties by the conviction that a rigid compliance with contracts would be enforced. This party was for enlarging the powers of Congress to effectuate these ends. The other party pressed for indulgence to debtors and for less rigor in the exact execution of contracts; for relaxing the admin- istration of Justice; for affording facilities for the payment of debts; for suspending the collection of them, and was opposed to any concession of power to Congress which might prove hostile to these views. Wherever this party prevaUed. paper money was emitted, the delay of legal proceedings was tolerated, suspensions of collecting took place. Where this party had not yet prevailed, the dread of gettln? the superiority greatly affected the fortunes of a very considerable jx>rtion of the community. This uncer- tainty aided in promoting pecuniary embarrassments, which at the time influenced almo-st all the legislatures of the Union. Pub- lic and private confidence was lost; the public debts due to Indi- viduals everywhere depreciated. In private transactions an as- tonishing degree of distrust prevailed. The bonds of solvent men could not be negotiated, but at a discount of 30. 40, or 50 percent. Real property was scarcely vendible. Sales of any article for ready money could not be made but at a ruinous loss. The debtor class of society might prove successful at elections, and Instead of pay- ing by the fruits of industry and economy might be relieved by legislative Interference. National wealth and national labor dwindled. Everywhere it was found that the people could not pay their debts. In some Instances threats were used of suspending the administration of Justice by private violence (5th vol. of the Life of Washington, pp. 85-^9). Amongst the various measures proposed for the removal of this gloomy state of things, a general convention to revise the clrcxun- stances of the union was one. and It succeeded. In Massachu- setts, a short time before, the utmost distraction reigned. The mob required an atmtement of the compensation promised to the officers of the Army, a cessation of taxes and of the administra- tion of Justice; they required the circulation of depreciated paper and a relief from public and private burdens. They threatened lawyers and courts, arrested the cotu^e of law, and restrained the Judges from doing their duty. Rhode Island, a paper-moneyed State, would not send deputies to the Convention, and North Carolina long hesitated In acceding to the Federal Constitution. Such were the unpromising circum- stances which America had to deplore; and such the alarming disorders which were to be remedied by the Convention. One of the most pwwerful remedies was the tenth clause of the first article, and particularly the two sentences which we are now considering. They operated most efficaciously. The new course of thinking, which had been inspired by the adoption of a con- stitution that was understood to prohibit all laws for the emis- sion of paper money and for the making anything a tender but gold and sliver, restored the confidence which was so essential to the internal prosperity of nations. There was a great and visible improvement In the circum- stances of the people. Conviction was Impressed upon debtors that personal exertion alone could save them from embarrassment. An Increased degree of industry and economy was the natural consequence of such an opinion. These clauses, as they were not only necessary for the regulation of intercourse between the State and State, and the citizens of each, to prevent the misunder- standings which were likely to arise from the prohibited causes. are equally so for regulating the Intercourse of citizens of the same State with each other, were therefore considered as a fun- damental law of the Union and also a part of the constitution of each State. What was it to the SUte of Vermont If Georgia should pass an ex post facto law or bill of attainder which could operate only upon those within her own territory? The restric- tion was imposed upon Georgia not for the sake of the people of Vermont but for the benefit of Georgia and for fear of the tyranny which her own legislature, at some future time, might be tempted to exercise. A law, Impairing the obligation of con- tracts, as It was equally injurious to citizens of the same State as to foreigners and citizens of other States. Is equally prohibited as to all. and Is not restrictive of State legislation only so far as regards citizens of other States. The constitutions of the several States had left the power vmlim- ited in their State legislatures. The framers of the Federal Con- stitution believed it to be of indispensable importance not to leave this power any longer in the hands of the State legislatures. Bsperience had demonstrated the baneful effects of its exercise. The known disp)osition of man excluded the hope that it would not be used for the same pernicious purposes in future. Under the smart of this experience, such were the feelings of the American people at the time, still suffering under repeated emissions of depreciated paper, that not a dissenting voice was raised against the clau.se before xu. No State required It to be expunged, nor did any State propose an amendment. It was universally received without an exception, and the effects of the clauses themselves were miraculous. Public and private confidence took deep root. The people of America were reinstated in the admiration of the world. The precious metals flowed in upon them. Paper money 1934 CONGRESSIONAL RECORD-- SENATE 415 suddenly stopped In Its career of depreciation and took a stand I paper and the injunction to wait 100 years. If he will not take Itt from which It never departed; Industry revived universally; and to u."5 In America was given a notable proof that whenever a nation is virtuous and honest it will prosper both In wealth and character, and that whenever a contrary course Is pursued, such Is the wise decree of Providence, that prosperity of either kind will not long follow In her train. Do these acts of our legislature revive any of the recited mis- chiefs? If they are valid, what is there to distinguish our present situation from that which preceded the Federal Constitution? Can our legislature emit paper money and give credit to it by promising redemption by taxes and public property? Will not such money depreciate? Cannot the legislature to every real purpose make It a tender? And will not all the consequences ensue, which followed the like causes heretofore — payment of debts with depreciated paper, the dismissal of self-condemnation for unfaithfulness in contracts, a dereliction of industrious efforts, facility in the assumption of debts, a thirst for more paper, public Inquietude under the ravages of speculation. Indifference if not dislike to the Government, loss of public and private credit, the transportation of our commodities to countries where the money is not degraded, the removal of our capital thither, the cessation of active labor, the decrease of national wealth, poverty, embarrassment, open resist- ance to the laws, and a general cry, as from a sinking ship, of save us! save us! Part of the loss by depreciation falls upon every man through whose hand the money passes, and to avoid the loss as much as pcsblble. every holder makes haste to get rid of It and makes some sacrifice to do so. Those to whom debts are due. become | debtors to an equal amount, to the end that what Is lost by depreciation for debts due to them, may be saved by the depre- j elation of debts due from them. Many who are not debtors Im- ; mediately become such by the purchase of property to as great an amount as possible, that they may gain as much in value as the sum to be paid to them loses In value by depreciation. Debts i instead of being extinguished are multiplied, and the way is pre- I pared for further emissions. Those who become creditors, know- j ing the risks they run. will have such advanced prices as will be , a probable Indenmlflcatlon against them. A small number of [ credits amount to Immense sums, and the thirst for paper money Increasing with the means taken to allay it, new debtors clamor for more paper. Wanting means, and laboring under the disad- vantages in.separably incident to the paper-money system, no State, however, blessed by nature, can attain prosperity. Em- Grant, for argtnnent sake, that the right to execution la not an antecedent right, attached to the contract, but a newly created one. given liy the legislature only upon condition. Shall it be permitted so to frame the condition as to make It Involve the relinquishment of a right secured by the ConstituUon? By the latter the creditor is secured against paper money. Can he be required to relinquish that secxirity in order that he may bepome entitled to the benefit of this newly created right, to have execu- tion? By such Inventions every constitutional right may In sue- cesslon be bartered away. Constittitlonal rights are vested, tin- exchangeable, and Inalienable. They belong to posterity as well as to the present generation. We may use and enjoy, but not transfer them: and every such condition is utterly void. If execu- tion can be suspended on any condition, then the leglslatxire has an absolute power to suspend it forever. How easy It is to invent a thousand conditions with which no man in his senses would comply! If the right ts newly created, and the condition void, it must vest without the perfomuince of the condition; and the result is that, if the right be antecedent, suspension is an uncon- stitutional penalty: If It be newly created, the condition is uncon- stitutional and the right vests absolutely. In either alternative, the endorsement need not be made. This conclusion follows upon a correct interpretation of the clause prohibiting tender laws. It equally follows a Just inter- pretation of the sentence prohibiting laws to Impair the obliga- tion of contracts, contained In article I, section 10. of the Consti- tution of the United States; and In article 11, section 20. of our BlU of Rights. A grant made by the State, being an executed contract, cannot be revoked by the legislature if pursuant to a law made by themselves; this point is so decided in Fletcher v. Peck. With respect to executory contracts, it wUl be admitted without controversy that the terms and conditions of them can- not be In any resi>ect altered or interfered with by the legislating. The time, place, person, or thing to be done cannot be changed by act of assembly. Covenants sometimes by ex post facto cir- cumstances become unreasonably burthensome. He that covenants to pay rent for premises he never enjoys by the accidental burn- ing of them must nevertheless pay the rent. A man agrees to perform a voyage by sea xuider a penalty by way of stated dam- ages for noncompliance, and he is hindered from an exact com- pliance by adverse winds; still he must pay the penalty. In these and all other cases of contract, the legislature cannot interfere to make them more Just or reasonable than the parties have made them. For thus no contract could be made that the parties might l>arrassment8 Incessantly multiply; and for discharging debts with ^ ,, „ i„t^,.>„„if.„„ «/ ♦>,» out paying them, the country must be visited with misfortunes ; depend on for fear of the new modeling interposition of the which no country can bear i legislature. Thus far Is plain; but stUl the question remains. Is The injuries inflicted upon sister States will not be endured. | the suspension of execution within the prohibition? Does an act The creditors there, when the attempt Is made to pay gold and I to suspend execution Impair the obligation of contracts made sliver dVbts with depreciated paper, will seek redres^. should the ' before it? What the obligation of a contract U may be discerned Constimtion and laws of the Union be found Inadequate to afford | by considering '^^*,V " ^„^^,tit^n'''and whv^^^^^ it the legislature of their own State will look to its strength and i alone has not any legal obligation, and why? Because there is no to the dissDlution of a compact, which instead of procuring Justice i law to er^orce it. The contact ^.^^^^^^^l^^P"^^^^-^,^^ to the citizens, excludes them from It. Should the disappointed sanctioned by law, it promtees to enforce performan<^8h^^^^^^ the credVtor be a foreigner, after remonstrance to the head of the party decline performance himself. ^.T!^/, ,J,»7. ^» .*^^« *?^;« °f "^ Jlnfon and the devlfopment of Its Incompetency, he wUl appeal J °"\f »"°^' '^J* ^^^ «J*«^*ont^^^ M^'^^aS^ dSlrt I to his own government and force will be resorted to. The whole ^H« ***»?•, ^1™*"^* *=°f^*^^ Union becomes exposed for the Injustice of one State, and will I specific execution, and a . BUhsequent act declare that iQfre "MU be disposed to leave It to suffer for Its own misconduct rather than be responsible themselves for that which they cannot pre- vent. In either alternative, disunion is the end. On the contrary. If the Constitution and laws of the Union make void such act of the legislature, and we deem them valid, the debtor In this State will be found to pay gold and silver to his creditor who lives not be a specific execution, the obligation of the contract is lessened and impaired. If the law in being at the date of the contract give an equivalent in money, and a subsequent law say the equivalent should not be in money, such act would impair the obligation of the contract. If the law m being at the date of the contract give immediate out oT the Stated when* at the same time, his debtor within the ' execution on the rend It on of the Judgment rV^^^. louM S?ate. who owes an equal amount. wUl pay In depreciated paper, declaring that ,t»^« «!5,"V°^"i^2lv « mSch to nrtSe « S perhaps of not half the value; and thus, one debtor residing lessen or Impair ^f,*^'^^':^^^'^^,"^'^^^^^^''^^!^ f^ij ^thln the State wUl be ruined by the legalized unfaithfulness of i it suspended execution 'o«ver; in whld^ att« ca^ th^ 1^ Mother And in our State courts, the ^me words in the same obligation of ^^^,^'=<>^^^''^^Z°'it^H.TSlL^^^t^J^. dause mean one thing; but In the Federal court, another. When legislature may alter remediw; but they P^ °^"J" ""! part of the citizens are thus sacrificed to suit the convenience of , gards «^*f«^~* ~°*^', *^ "Pf '^.^ i,ft«fSf^S t^e ^n! Another part, and when such sacrifices become habitual by the I dilatory ^^^^ ^hoM ot^^^^^ law ^^^^^^^^^^%^^ frequent exercise of a power, which never lies dormant, after the , tract was made, if such alteration be the dlrwt and "P^f^^ ^^ actaowledgment of Ite existence. It wUl not be long before th. of the l^Sfiiw ''if J^^ci sSte«tlon ^re £? delay." This clause relaU* to e^ry^possime^jv^^^ It is only said to the creditor. "If you will not teke paper, give , '"ay «"»*^^° '^'^^^Jf^^^^^^T^^'^^^ up the means of getting anything at all for 2 years with the property ^^^^j^j^^^P^^^ ^ ff^^ deSl £e exJ?Stlon Sf" prospect of stUl longer delay by repeated acts of the legislature. . the rlgnt wnicn " J^"^" J" , , ^* ^ chattel is when tier- Take^ this paper whSi I have no' right to Impose upon you. or give | contract; wbich being a,P^J*lj^8jJ„J; to S^ Ji hlTgoScf^ up a right which I have no authority to take from you." Suspen- | formance »J Jjf^jfj^^' J^'ilf jTlt'' "iS^^ to be dons. slL of%xecutlon Is a penalty. If. but f?r. the act. the creditor ! chattel. JJnd^^^^ would be entitled to It as a right atteched to his antecedent con- tract, and It Is a penalty prohibited by the tenth section now under consideration. If the legislature has power at this day to is upon royal power; In otir country It Is upon legislative, and aU other power. We itoust understand the meaning of that, not- withstanding any act of the legislature to the contrary, every man enact a suspension of execution for refusing to take paper, that 'V""Xrr„7"'',J^'t "ijjd justice" in aU owes " without sale, denial. section is abrogated. Two yeare may be extended to a hundred, i shall have ngni ana jumwrn ui and where is the difference between a direct injunction to take or delay. 416 CONGRESSIONAL RECORD--SENATE to In n»«. wtien the OoMtltutlon wm formed. It could not ha/« been apprehended Uiat any other department of government, ec eept that of the legislatiire. would ever have weight enoiigh U offer any obstruction. Experience from 1777 had fully demo a ■trated the Imbecility of every executive office In the Dnltsd Statee. From the executive no such offer could be anticipated In 3d Institute. 56. my lord Coke says, the king la the speaker, and m contemplation of law Is constantly present In all hla courta. pronouncing the words of Magna Carta " Nulll vendemus. null! negabimua. aut differemua jtiatltiam vel rectum." In Te a- neeeee every legislature is In contemplation of tew diulng t le whole session, and the Judge of every court duting the whdle term, in the constant repetition of the words " right and Justice must be " administered without sale, denial, or delay." In Institute, 56, Ju.itlce Is said to be the end and right the meakis whereby we may attain the end. and that is the law. What tt at means consists In Is mc»-e specially explained in Sullivan. 5i3, where It Is stated to be original and Judicial process. Origiial process, he says, must Issue without price, except that which t He law fixes, and' without denial, though the defendant be a favor te of the king or government, who interferes in bis behalf, and m\ ^ be proceeded on by the Judges, after suit Instituted upon It. wit li out delay, themselves or by order of the king. or. as we say. i ct of the legislature. And the Judges where the causes depend mi ist issue the proper Judicial process, without fee or reward. ezc< pt that fixed by law. In other words, where Judgment is rendeied the Judges shall cause execution to Issue, notwithstanding any order or act of assembly or other pretended authority whatsoever This is the long-fixed, well-known meaning and legal constnc tlon of the words " right and Justice without sale, denial, or delaf .' They clearly comprehend the case of executions suspended act of the legislature in every Instance where Justice requires that it should Inunedlately issue, as It manifestly does where Ibe law. operating upon the contract when first made, held out to the creditor the promise of inunedlate execution after Judgmeit ■ •••••• The result, then, of the Investigation we bave made Is this, tliat suspension of execution as directed by these acta of the legislature now under consideration. Is forbidden by the prohibition of ten ler laws, as a direct consequence of the prohibition: also, by interdiction to pass laws Impairing the obligation of contracts, suspension or execution being an imf>alrlng of such obllgatU n; \ and furthermore, by the declaration that Justice and right sliall be done, without delay in all cases, the process of execution bel one sense of the term right, which is not to be delayed. We are. therefore, bound to say that these acts are to the Constitution and void, so far as relates to the suspension execution: and that execution ought to issue Immediately wlth< ut »ny such endorsement as the act requires. The Judicial tribuc&ls at the country must refuse sanction to acts which are to be tiC' cuted through their agency, such as an act of sxispension of eie cutlon is. which cannot take place without the assent of the coi rt. There are some violations, which need not their instrvunental|ty, and. of course, cannot meet their rejection, and which alone great body of the people must correct. An occlusion of the coi^rts of Justice would be one of them. The courts cannot sit but on days appointed by the legislature; and in that and other instances, the court having no agency, would have no responsibility. Whrr ever their cooperation is unconstitutionally required, It is most sacred of all their duties to withhold it. and whenever t^ey are found to want Ormness to do so, the Constitution and public freedom die together. • ••••• TAXAnOM OF INTOXICATING LIQUOSS Mr. HARRISON. Mr. President. I move that the voies by which House bill 6131 was ordered to a third reading apd passed on yesterday be reconsidered. The VICE PRESIDENT. The question is on agreeing to the motion of the Senatm- from Mississippi. Mr. HEBERT. I suggest the absence of a quorum. The VICE PRESIDENT. The clerk will call the roll. The legislative clerk called the roll, and the follow^ Senators answered to their names: repugni Jit Adams CDpeland Keyes Robinson, Ind Ashurst Costlgan KUig RiMsell Austin Cutting LaFoUett* SehaU Bachman Davis Lewis Sheppard BaUey Dickinson Shlpstead Bankhsa4l Dleterlch Lonergan Smith Barbour Krlckson IfcAdoo Stelwer Barkley Fees McCarran Stephens Bone netcher McKellar Thomas. Okla. Borah Frazler UcNary Thomas. Utah Brown Glass Murphy Thompson Bulkier Oddsborougb Neely Trammell Bxilow Gore Norrts Tydlngs Byrd Hale Nye Vandenbcrg Byrne* Harrison OlCahoney VanNuys Capper Hastings Overton Wagner Caraway Batch Patterson Walsh Carey Hatfield Pittman Wheeler aark Hayden Pope Connaiiy Hebert Reynolds cooiidae Boblnson. Ark. January 11 ng Qt of ,he Mr. LEWIS. I desire to announce that the Senator from Alabama [Mr. Black] is detained in a meeting of the special committee of the Senate to investigate ocean and air mail contracts. I desire also to announce that the Senator from Wash- ington [Mr. Dill] is detained on departmental matters; also, that the Senator from Wisconsin [Mr. Duffy] is neces- sarily detained in connection with relief matters for his State; and that the Senator from Georgia [Mr. GrosGEl is temporarily absent attending to matters of importance in connection with his State. I desire also to announce that the Senator from Kansas [Mr. McGiLL] is detained on important departmental matters. Mr. HEBERT. I desire to announce that the following Senators are necessarily absent from the Senate: The Sena- tor from Vermont [Mr. Gibson J, the Senator from Rhode Island [Mr. Metcalf]. the Senator from New Jersey [M.-. Ke.\n]. the Senator from South Dakota [Mr. Noreeck], the Senator from Pennsylvania [Mr. Re£d]. the Senator from Delaware [Mr. Townsend], the Senator from Connecticut [Mr. W.ALCOTT]. and the Senator from Maine [Mr. White]. The VICE PRESIDENT. Eighty-one Senators have an- swered to their names. A quorum is present. Mr. CLARK. Mr. President, a parliamentary Inquiry. The VICE PRESIDENT. The Senator will state it. ISIr. CLARK. In the rear of the Chamber we were unable to hear the motion of the Senator from Mississippi. The VICE PRESIDENT. The motion of the Senator from Mississippi is that the Senate reconsider the votes by which it ordered to a third reading and passed House bill 6131. Mr. CLARK. Mr. President, I make the point of order that the bill having passed and conferees having been ap- pointed, the motion to reconsider comes too late. The VICE PRESIDENT. The attention of the Chair has been called to that suggested point of order. It seems to the Chair that the philosophy of the rule is that, the bill having been sent to conference, a revocation of the action of the Senate would suspend the action of the conferees. The Chair therefore overrules the point of order. Mr. CLARK. If the Chair so rules, I move to lay on the table the motion of the Senator from Mississippi. Mr. HARRISON. On that I ask for the yeas and nays. The yeas and nays were ordered, and the Cliief Clerk pro- ceeded to call the roll. Mr. BULOW (when his name was called). On this ques- tion I have a pair with the senior Senator from New Jersey [Mr. Kkan] and withhold my vote. Mr. FESS I when his name was called). I have a general pair with the senior Senator from Virginia [Mr. Glass]. I transfer that pair to the senior Senator from Connecticut [Mr. Walcott] and will vote. I vote "yea." Mr. LEWIS (When his name was called) . I have a general pair with the Senator from Vermont [Mr. Gibson]. Not knowing how he would vote on this question, I withhold my vote. Mr. McKELLAR (when his name was called). On this question I have a general pair with the Senator from Dela- ware [Mr. TowNSBNB]. I transfer that pair to the senicH* Senator from New York [Mr. Copxland] and will vote. I vote " nay." Mr. ROBINSON of Arkansas (when his name was called). I transfer my pair with the Senator from Pennsylvania [Mr. Rsn} to the Senator from New Hampshire [Mr. Brown] and will vote. I vote " nay." Mr. TYDINGS (when his name was called >. On this question I have a general pair with the senior Senator from Rhode Island (Mr. Metcalf]. I transfer that pair to the Junior Senator from Kansas [Mr. McGill] and will vote. I vote " nay." The roll call was concluded. Mr. LEWIS. I desire to announce that the Senator from Alabama [Mr. Black] is detained in a meeting of the special committee of the Senate to investigate ocean and air mail contracts. 418 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 417 I desire also to announce that the Senator from Washing- ton [Mr. Dill] is detained on departmental matters; also, that the Senator from Wisconsin [Mr. Duffy] is necessarily detained in connection with relief matters for his State; and that the Senator from Georgia [Mr. Georgb] is tem- porarily absent attending to matters of importance in connection with his State. I desire also to announce that the Senator from Kansas [Mr. McGill], the Senator from Tennessee [Mr. BachmanI, and the Senator from New Hampshire [Mr. Brown] are detained on important departmental matters. The Senator fr'dlng9 Van Nujrs Wagner Walsh Wheeler Pope Reed Townsend Walcott White So the Senate refused to lay Mr. Harrison's motion on the table. The VICE PRESIDENT. The question is on the motion of the Senator from Mississippi to reconsider the votes by which the Senate ordered to a third reading and passed House bill 6131. Mr. CLARK. On that I ask for the yeas and nays. The yeas and nays were ordered, and the legislative clerk proceeded to call the roll. Mr. BULOW (when his name was called). Making the same announcement as on the previous vote, I withhold my vote. Mr. LEWIS (when his name was called) . I have a gen- eral pair with the Senator from. Vermont [Mr. Gibson 1. Not knowing how he would vote on th's question, I withhold my vote. Mr. McKELLAR (when his name was called). Making the same announcement as to my pair and transfer, I vote " yea." Mr. ROBINSON of Arkansas (when his name was called) . Announcing the same pair and transfer as on the previous vote, I vote " yea ". Mr. TYDINGS (when his name was called). Making the same announcement as before, I vote " yea." The roll call was concluded. Mr. HEBERT. I desire to announce that the following Senators are necessarily absent: Mr. Gibson. Mr. Metcalf, Mr. K£AN. Mr. Norbeck. Mr. Reed. Mr. Townsend, Mr. Wal- cott. and Mr. White. Mr. LEWIS. I wish to announce that the Senator from Alabama [Mr. Black] is detained in a meeting of a special committee of the Senate to investigate ocean and air maU I wish also to announce that the Senator from Washington [Mr. Dill] is detained on departmental matters; also that the Senator tnmx Wiscooain CMr. DufftI is neoessarOy de- tained in connection with relief matters for his Btat«. and that the Senator from Georgia IMr. GkobobI is temporarily absent attending to matters of Importance In connecUon with his State. I desire also to announce that the Senator from Kansas [Mr. McOiLLl, the Senator from Tennessee (Mr. BackkamI, and the Senator from New Hampshire [Mr. BsownI are de- tained on inyxH-tant departmental matters. The Senator from New York [Mr. Copilamo] has been called to the White House axKl is unable to be preseol on this vote. The Senator from Montana [Mr. EmcksohI. the Senator from Washington [Mr. Bowil. and the Senator from Idaho [Mr. Pops] are necessarily detained from the Senate on official business. The result was announced — yeas 43, nays 30. as follows: Adams Ashurst Austin Bailey Bankhead Barkley BTilkley Byrd Byrnes Coolldge Costlgan Barbour Borah Capper Caraway Carey Clark Connally Davis Bachnum Black Bone Brown Bulow Copeland YBAS-^iS Cutting Logan Dleterlch Lonorgaa Fletcher McKellar CHass Murphy Gore Neely Bale CMahonsy HarrtsoB Oterton Batch Plttman Hayden Reynolds Keyes RoMnson. Ark. King Sheppard NAYS— 30 DIcklnaon La PoUsiU Fees McAdoo Frazler McCarran Ooldsborougb McWary Bastings Norrls Hatfield Nye Hebert Patterson Johnson Robinson. Ind. NOT VOnNO— 23 Couzens DIU Duffy Erickson George Gibson Kean Lewts Long McGUl Metcalf Norbeck Smith atepbens Thomas, Okla. Thomas. Utah Thompson TrammcU Tydlags VanNuys Wagnex Walsh RuaseU SchaU Shlpstead Stelwer Vandenberg Wheeler Pope Eleed Townsend Walcott Whit* So Mr. Harrison's motion was agreed to. The PRESIDENT pro tempore. The Senate having voted to reconsider the vote by which the bill was ordered to a third reading and passed, the bill is now before the Senate. Mr. MURPHY. Mr. President, on the roll caU on the second amendment offered by the Senator from Missouri [Mr. Clark], relaUng to section 13 of House bill 6131. I voted in the affirmative. Inquiries since having convinced me that the amendment would tie the hands of the administra- tion in negotiating reciprocity agreements, I desire now to move a reconsideration of the vote by which the amend- ment was agreed to. The PRESIDENT pro tempore. The question Is on the motion of the Senator from Iowa [Mr. Murphy] to recon- sider the vote by which the amendment offered by the Senator from Missouri [Mr. Clark] was agreed to. Mr. SHIPSTEAD. Mr. President, that motion Is debat- able, is it not? The PRESIDING OFFICER. The motion is debatable. Mr SHIPSTEAD. I merely desire to state that on yes- terday during the debate it occurred to me that there might be a connict between this piece of legislation and the au- thority already granted to the President to bargain or deal in quotas with foreign countries. The matter did not come up yesterday in the debate, and I thought this matter ought to CO to conference, where that part of it could be threshed out" to have the matter cleared up. Certainly if the desire is to be able to use the power ahready granted to the President to faciUtate the exportotion of American products in return for quotas on Uquor. that is an important matter, but on the spur of the moment, with- out having knowledge as to bow it will affect the Executive power. I thought the matter ought to go to conference, where it could be discussed and properly weighed, to see whether it would have the ill effect we were told It would have. I LXV.V11I- -27 1934 CONGRESSIONAL RECORD— SENATE 419 «•# !■ ii mi sBv j»l% ^m flt^iwA Clark Connally Coollds* n»yaen rope Heb«rt Reynolds Johnaon Boblnaon. Ark. committee of the Senate to investigate ocean and air mail contracts. 418 CONGRESSIONAL still think It ought to go lo conference and will vote to senp It there. The PRESIDENT pro tempore. The question is on agree - ing to the motion of the Senator from Iowa [Mr. Mtjrphy] that the vote by which the amendment offered by the Sena- tor from Missouri [Mr. Clark], on page 8. after line 17, wajs agreed to. be reconsidered. Mr. HARRISON. I asic for the yeas and nays. The yeas and nays were ordered, and the Chief Cler|t proceeded to call the roll. Mr. BXJLOW (when his name was called). On this ques- tion I have a pair with the senior Senator from New Jersesr (Mr. KiANl. and therefore withhold my vote. Mr. McKELLAR < when his name was called) . I make the same statement I made on the previous vote with referen<^ to my pair and its transfer and will vote. I vote " yea." Mr. ROBINSON of Arkansas (when his name was called Repeating the announcement made on the last vote, I votje " yea." Mr. TYDINGS (when his name was called). Making tl^ same announcement as before. I vote " yea." The roll call was concluded. Mr. LEWIS. I wish to announce that the Senator from Alabama [Mr. Black] is detained in a meeting of a speciiJ conunittce of the Senate to investigate ocean and air ma|l contracts. I wish also to announce that the Senator from Washing - ton [Mr. Dill] is detained on departmental matters; ako that the Senator from Wisconsin (Mr. DurrrJ Is necessarily detained in connection with relief matters for his State, an ti that the Senator from Georgia [Mr. Oborge] is temporarily absent attending to matters of importance in connecticp with his State. I desire also to announce that the Senator from KBHistA [Mr. McOiLLl, the Senator from Tennessee [Mr. BachmamI, and the Senator from New Hampshire [Mr. BrowkJ are de- tained on important departmental matters. The Senator from New York [Mr. CopELAifo] has beea called to the White Rouse and is unable to be present on this vote. The Senator from Montana [Mr. EricxsohI and the Seii ator from Washington [Mr. Bone] are necessarily detain^ from the Senate on official business. The result was announced — yeas 44. nays 31. as follows YEAS— 44 Adama Ashurst Austin Bailey Bankbrsd Bu-kiey BulUey Byrt ByraM Cooltdge Costlgan Bvbour Borah Capper Caraway Carey Clark Connally Daris Bachman Black Bone Brown Bulow Copeland Cutting Logan Dleterlcb Lonergan Fletcher McKellar 0;as8 Murphy Oore Neely Rale O'Mahoney Harrison Overton Hatch Ptttman Hayden Pope Keyes Reynolds King Robinson. Ark. NAYS— 31 Dickinson Feas Prazler Co'.dsborough Hastlngb BatOeld Hebert Johnson La FoUette Lewis McAdoo McC&rran McNary NorrU Nye Patterson NOT VOTING — 31 Couxena DUl Duffy Brlckson George Gibson Kean Long McGUl Uetcalf Norbeck Reed Bheppard Smith Stephens Thomas, Okla. Thomas. Utah Thompson Trammell Tydlngs Van Nuys Wagner Walsh Robinson. Ind. Russell Scball Shlpstead Stelwer Vandenberg Wheeler Townaend Waloott Whit* So Mr. Mttrphy's motion to reconsider was agreed to. The PRESIDENT pro tempore. The question recurs in the amendment of the Senator from Missouri [Mr. Clari^I Mr. CLARK. On that I ask for the yeas and nays. ■nie jtAS and nays were ordered, and the legislative cle'k proceeded to call the roiL RECORD— SENATE January 11 Mr. BULOW (when his name was called). On this ques- tion I have a jwiir with the senior Senator from New Jersey [Mr. Kean). and therefore withhold my vote. Mr. CAREY (when his name was called). On this ques- tion I have a pair with the junior Senator from Ohio [Mr. Bttlkley]. Not knowing how he would vote, I withhold my vote. If permitted, I should vote " yea." Mr. LEWIS (when his name was called). I have a gen- eral pair with the Senator from Vermont [Mr. Gibson]. Not knowing how he would vote upon this question, I with- hold my vote. I will further say that I am requested to announce that the senior Senator from Louisiana (Mr. LongI was called back to the city of New Orleans, in the State of Louisiana, on official business. I report his absence, as I have been requested to do. Mr. McKELLAR (when his name was called). I make the same statement as to my pair and its transfer as on the previous vote and vote " nay." Mr. ROBINSON of Arkansas (when his name was called). Repeating my previous aruiouncement as to my pair and its transfer, I vote " nay." Mr. TYDINGS (when his name was called). Making the same announcement as before, I vote " nay." The roll call was concluded. Mr. CAREY. I transfer my pair with the junior Senator from Ohio (Mr. Bulkley] to the senior Senator from Connecticut [Mr. Walcott] and will vote. I vote " yea." Mr. HEBERT. I desire to announce that the following Senators are necessarily absent from the Senate: The Senator from Vermont I Mr. Gibson], the Senator from Rhode Island [Mr. Metcalf], the Senator from New Jersey [Mr. Kean], the Senator from South Dakota [Mr. NoRBECKl, the Senator from Pennsylvania [Mr. Reed], the Senator from Delaware [Mr. Townsend], the Senator from Connecticut [Mr. Walcott], and the Senator from Maine [Mr. WnrTE]. Mr. LEWIS. I wish to announce that the Senator from Alabama [Mr. Black] is detained In a meeting of a special committee of the Senate to Investigate ocean and air mail contracts. I wish also to announce that the Senator from Washington [Mr. Dill] is detained on departmental matters, and that the Senator from Georgia [Mr. George] is temporarily ab- sent attending to matters of importance in connection with his State. I wish also to announce that the Senator from Kansas [Mr. McGiLL], the Senator from Tennessee [Mr. Bachman], the Senator from New Hampshire (Mr. Brown] are de- tained on important departmental matters. The Senator from New York I Mr. Copeland] has been called to the White House and is unable to be present on this vote. The Senator from Montana [Mr. EricksonI. the Senator from Washington [Mr. Bone] and the Senator from Ohio [Mr. Bulkley], are necessarily detained from the Senate on official business. The result was annoimced — yeas 30, nays 44, as follows: YEAS— 30 Barboxir Borah Capper C&raway Carey Clark Dickinson Foss Prazler Goldsborough Hastings Hatfield Connally Davis Adams Ashurst Austin Bailey Bankhead Barkiey Byrd Byrnes Coolldge Costlgan Cutting La PoUette McAdoo McCarran McNary Norrls Nye Russell Schali Shlpstead Stelwer Vaudcnbcrg Wheeler Hebert Patterson Johnson Robinson. Ind. NAYS— 44 Dleterlch Logan Diiffy Lonergan Fletcher McKellar Glass Murphy Oore Neely Hale O'Mahoney Harrison Overton Hatch Ptttman Hayden Pope Keyes Reynolds K'"g Boblnaon, Ark. Sheppard Smith Stephens Thomas. Okla. Thomait. Utah Thompson Trammell Tydlngs Van Nuys Wagner Walsh (Mr. Dill] is detained on aeparunentai m»n«i», »«»" Lxxvm 27 1934 Bachman Black Bone Brown Bulkley Bulow CONGRESSIONAL RECORD— SENATE 419 KOT VOTING — 23 Copeland Kean Reed Couzens Lewis Townsend Dill Long Walcott ■rlckflon McGUi White George Metcalf Gibson Norbeck 9d Mr. Clark's amendment was rejected. The PRESIDENT pro tempore. If there be no further amendment, the biU will be read a third time. The bill was ordered to a third reading and read the third time. The PRESIDENT pro tempore. Having been read the third time, the question is, Shall the bill pass? The bill was passed. Mr. HARRISON. I ask that the order entered yesterday asking for a conference with the House on the bill and amendments and appointing of conferees be rescinded. The PRESIDENT pro tempore. Is there objection? The Chair hears none, and the order is rescinded. OHIO FALLS PROJECT OPINION OF FEDERAL POWER COMMISSION Mr. NORRIS. Mr. President, I have here an opinion ren- dered by the Federal Power Commission, delivered by its chairman, in the matter of determination of actual legiti- mate original cost of Ohio Falls project no. 289, Kentucky, and also an editorial printed in the Washington Herald, December 20, 1933, entitled " Curbing the Power Trust ", on the same subject, I ask that they may be printed in the Congressional Record. " There being no objection, the opinion and editorial were ordered to be printed in ttie Record, as follows: Fkoekal Fowes Commission, < Washington. OfIKION No. 11, OCTOBKB 31, 1933 LOUISVILLX HTDRO-ELECTSIC CO.. LICENSE! In the matter of: Determination of actual legitimate original coat of Ohio Falls project no. 289. Kentucky — opinion: Syllabus 1. A contract for exclusive construction and other services by the service company of a system to a public utility, both under common control, Involves one of the moet obnoxious practices of the holding company device, and the Federal Power Commission. In determining the cost of a licensed project, must closely scruti- nize such contract and the conditions under which It was made. 2. Where there Is common contiol of the service company and the operating company, the two being virtually departments of an integrated system, with the power Implicit therein arbltrarUy to dictate contracts and fix charges for services, the Commission must disregard the contract and demand evidence of the cost to the service company of the services rendered. Under the Federal Water Power Act the allowable cost to the licensee for construc- tion and other service can be no more than the cost of such service to the service company under common control with licensee. 8. The Federal Water Power Act forbids the Commission to allow other than actual legitimate original cost of the construc- tion of the project. The coct must be (1 ) actual, that Is, real and bona fide, as distinguished from fictitious or fabricated, whether by Intercorporate dealings or otherwise; and (2) legitimate, mean- ing not coerced, collusive, fraudulent, or unreasonable; and (3) original, as excluding elements of subtequeut enhancement, profit, or accretion. 4. Where there \b common control It is not sufficient to show that the prices t The Holding Company, Bonbri^t and Mtoans, lOSa. pp. 114-1 5 "This great system (H. M. ByUesby Co.) involves the most coip plicated holding-company set-up with which the writers familiar. The underlying holding company is the Standard Cka tt Electric Co., a pure holding company whose subsidiaries supply electric, gas. steam heating, tel^>hone. water, or transportatii in cervice in 1.048 communiUes located in ao States. At the eiid of 1930 it served 1,017,414 customers. • • • The growth of the system in r«cent years has been most rapid. In 1924 t le total electric power generated by the system amounted to 1,41' i 000,000 kilowatt-hours, or 2.6 percent of the commercial total 1 or the country. By 1030 this had Increased to 4.SM.0004X)0 kUowal t hours, or 6.S percent of the national total. In itself, this com pany represents the more or less ' normal ' holding-company pyi a mid, the Standard Oas * Electric Co.. with assets of $319,000,0 90 • ■• In lOao. controlling subakilaries with asscu ot 01.200.000.000. But ^on top of this typical holding company is a oorpocmt* organi^- Uon wblcli dtiftw sLmpto analysla. • RECORD— SENATE January 11 and execution of contracts, assuming that each officer could re- member the particular company for which he was acting. The following chart, made from evidence of record, graphically shows the completeness and harmony of control: Offloar J J. O'Rrien. R.J. Graa... Hslfred Erickson. r. C. Gordon Stsndaril Oas A Electric Co. President Vice president. Vice president. Bylle?hyEn- , LouisvUle Oas pineenng 4 ^ Electric Co., .Mdn;t«ement Delaware CorporaUon Louisville Hydro- Elec- tric Co. President President I President Vice president. .do-. Oeorcen. Harries do„ Vice president Assistant secre- tary and as- sistsut ueas- urer. Vic« president.. ....do B. W. Lynch. M. A. Morrison.. Herbert List. ...do !...-d0- frecretary- txesMirer. do . Wm. O. Pohl Assistant se(^ retary and •siittant ireiMurer. ....do .\jMf.itant sec- retary and a.any may be able t) accentuate this natxiral disadvantage in which the consimier find s himself in dealing with the oi>eratlng utility, the policies of sue i holding company are not equitably free from public scrutin] , Judgment, and criticism. Ab^ase by a private imreg\ilated cor- poration of the exercise of the power of control to collect excesslv i toll from an operating public utility is a gross injustice to ths public which pays the bill. Such Intercorporate profits have na proper place in the cost or capital Investment structure of a. public utility operating company. This Is doubly true where ths operating company is a company bound by Federal statute to i capital structure limited to net investment. The Byllesby Service Co. furnished for these extraordinar r profits only services provided by the personnel of the manag< - ment group. There was no substantial investment upon whlci to earn a return. It took no risk. It constructed on a coet-pks basis. It purchased materials and supplies for licensee's accouu ;. The finance* of licensee being under system control, there weie no losses Incident to bad debts, delay In collecting, disputes, (r law suits. (6) Upon Its Incorporation, the Service Co.'s sole asset, cap- italized as a round million dollars, was the artificial value Im- plicit In its connections and ability, through a small group of mei i. In their fiduciary capacity as directors of operating companies, to guarantee profitable biislness. Officers and directors of a quas - public corporation. Ln contracting with themselves In another coi - porate capacity for services where the gain of one may be tlie loss of another, must be actively cognizant of their duty in f a4 1 •s well as In law to act as a trustee charged with admlnisterix g the tnist equitably In the Interest of the consuming public. Th s dealing with themselves by directors and executives on behalf (f their cooperating companies can only be justified. If at all. on tie ground that In their capacity as managers of the Service Cortant, an avoidance of the statu- tory requirements of more exact and direct proof. No question is entertained as to the accuracy of the Federal Trade Commission's audit; but that Commission derives its authority from, and its duties are defined by, a statute different in terms, intent, and pur- pose from the Federal Water Power Act. Its audit, made for a different purpose, does not show certain Important facts required by the Federal Water Power Act. It Is the duty of the Federal Power Commission not only to audit and determine items of alleged cost with reference to their actual expenditure, but also to scrutinize each item with regard to its being a reasonable, appro- priate, and legitimate cost. The accounts of the Byllesby Service C^. as kept at the time of the said audit show arbitrary classi- fications of expenditures not in conformity to the Commission's rules of accoiuitlng. The same Is true as to allocations of per- centages and ratios of overhead and expense, and also of profit to the engineering and other departments. Hence there Is no evidence before the Conunission nor in the proposed stipulation from which it can determine with reasonable certainty the cost of the services within the meaning and intent of the act. (9) In a case involving an intercorporate contract such as Is here presented the Commission should have submitted to it satis- factory evidence as to all elements of cost, including salaries paid, and bonuses, if any, to the officers and directors of the service company, and also to show whether there had been any duplica- tion of such payments to individual officials for services allegedly performed in their dual capacities. For the purpose of the Federal Trade Commission such informa- tion was unnecessary and was not collated. The proposed ratio is admittedly not exact as applied to the specific services rendered to licensee's project but Is at best an over-all average cost of services rendered by one department of the service company. To accept this proposed ratio would be to assume, as the Commission has no right to do, that all of the Items entering into the over-all costs are of such character and amount as to be in conformity to the requirements of the act and the Commission's accounting rules and regulations. The Commission is of the opinion that it has no right to predi- cate a finding and determination upon the tendered secondary •Tldnice and Is unwilling to approve and adopt the proposed stipulation. Therefore It disallows the fee of $481,583.48 as part of the actual legitimate original cost of this project, with leave to licensee to submit appropriate evidence In support of its claim. It Is clear that the failure of licensee to submit evidence of these costs was due to the fact that It had no record of such costs, nor any control over the only source of this essential Infor- mation. System management had supplanted company autonomy, thereby depriving licensee of any real freedom to manage and direct Its own affairs. Fcr necessary legal purposes Its corporate body was kept alive, while skillful pressure produced a general paralysis. A corporate entity became a subservient and highly profitable nonentity. The undisputed evidence shows that the Byllesby Service Co. — not a public utility, not subject to direct regulation by either Federal or State authority — took charge of the affairs of licensee, a public utility. It prepared the application of the articles of in- corporation: as licensee's " agent " it prepared, filed, and followed through to its granting, the application to the Commission for the license for the project. The financing, purchasing, construction. Inspection, most of the accounting, and all of the legal work were done for licensee. These were not acts of benevolence, but Intruded services for gain. Such a holding company dynasty — not exceptional, but typical — with its absentee ownership and management, its sovereignty over far-fiung dominions in many States, but subject to the direct jurisdiction of none, its authority centralized in a few strong hands, its " fee " taxation without representation of the operating companies, is a grave economic and social peril. It calls for prompt corrective and preventive measures. The crux of the problem is the present inadequacy of the law. State commissions and the Federal Power Commission should be clothed with all regulatory jurisdiction possible over such holding and service companies. E>efenders of system control and service contend, as counsel for licensee argued In this case, that through a large coordinated system economies are effected: (1) Through a better specialized managerial and technical staff than any one operating company could support, and (2) decreased overhead by elimination of " lapse time ", etc.. because of assured " clients ", and that the work to be done for the whole system can be rationalized. Waiv- ing the unsocial aspects, and certain limitations to the economic argument, it Is to be observed that the cooperative support of the operating companies In an integrated service plan is the sine qua non of the economies resulting. The holding company merely brings the companies together and acts as a clearing house; of Itself it contributes nothing to economy. Hence. It has no right to take unto Itself all of the fruits of the cooperation. Such a family purse arrangement Is unjust and suggests a legal or. at least, a de facto separation, so the holding company and the operating company may live apart, each manage its own affairs, and support Itself. The valid objection to the holding company practice of profit making through monopolistic control of Its subsidiaries has been recognized by one large holding company which recently aban- doned this practice. The substituted arrangement provided may not be an adequate treatment of the subject, but it at least marks definite recognition of the problem and an approach toward Its solution.' LOSS ON COVXRNMEirr DAM (10) Licensee claims as a part of the cost of the project the sum of $193,164.34. representing an alleged loss in the construction of a dam under contract with the Federal Government. This dam. known as " United States Dam No. 41 ". was constructed primarily for the purpose of improving navigation on the Ohio River, but Its use for hydroelectric purposes was leased by the Government Pertinent facts upon which this claim is based, and as to which there Is no controversy, are: Licensee, by resolution September 30, 1925. requested the Byllesby Service Co. to bid for the construc- tion of this dam. offering to guarantee the Byllesby Service Co. Its actual costs plus a percentage fee. The Byllesby Service Co. submitted a fiat bid and was awarded the contract by the Gov- ernment. By the terms a! the contract between licensee company and the Byllesby Service Co.. executed April 15. 1926. the licensee guaranteed the payment of all the ByUesby Service Co. coets In »The Holding Company, Bonbrlght and Means, 1932, p. 186. "The Commonwealth & Southern Corporation • • • has recently announced that It has completely abandoned the prin- ciple of the profit-making management service contracts. It has achieved this object by the formation of an ancillary service com- pany called ' the Commonwealth & Southern Ck)rporatlon of New York ■ The nature of this company Is described in the following excerpt from Moody's Public Utilities, 1930 (p. 1557) : " 'All stock of the management company Is divided among the operating companies in the system pro rata to their gross earn- ings. Company renders a group purchasing and general super- visory service at cost divided pro rata on the basis of the gross earnings of the operating companies, but in case the cost of the service supplied is less than that estimated, the difference wiU be disUibuted to the operating companies in the form of divi- dends.' , ^ . " • • • It, or something like It. must sooner or later be adopted by all utility systems if they are to survive the growing resentment which their recent financial pracUces have aroused In the minds of the thinking public." the conctnictlon of the dam plua an vaglBmrtog utA •uperrlaioa fee of 5 percent thereon, the Ucenaoe to reoolTe any amount in exceae of that total which might be paid to the Byllesby Serrloe Co. by the Oovemment under the oontract. The Byllesby Sendee Co. completed the dam. Including a coffer- dam begun by the Oovernment. but let to the Bylleaby Service Co. for completion without competitive blda. more than a year ahead of the time set by the conuact. "nie OoTemment p«ld the con- tractor the full amount of lU bid and oontract In the sum of $2,362,499.93. The Byllesby Service Oo.'e alleged coeta expended, plus the 6-percent fee. totaled $2,666,004^. or tl83.164J4 In exceae of the amount received from the Oovemment. This excess amount was paid by licensee to the Byllesby Service Co. under the contract. Of this amount so paid, $71,466.04 represented the alleged excess costs over the amount paid by the Government, and $121,698.80 represented the 5-percent fee. In support of Its claim the licensee contends that delay In com- pletion of the dam would have delayed operation of the plant, resulting In loss of revenue and Increased cost of the project through additional Interest charges during an extended construc- tion period: that such delay would possibly have also meant ad- ditional costs In cleaning up after winter floods and Ice damage; that other possible consequences of delay or suspension of work dtu-lng the winter might have Increased overhead expense and Impaired morale of the construction force; that an added measure of assurance against such contingent additional costs of the proj- ect was afforded Ucensee by reason of the Byllesby Service Co. getting the contract for the dam. since It already had the contract for the project works and was in better position than any other contractor to coordinate and expedite the construction of both the dam and project works. For these and other reasons, licensee contends that economies were effected for Its benefit greatly In excess of the amount paid to the Byllesby Service Co. under the contract. ,^ . , Whatever factual basis. If any. there may be for the equitable considerations urged by the licensee, the Commission is pro- hibited by law from allowing this " loss " item unless It Is a part of the cost of the licensed project works. The terms "project" and " project works " are defined by section 3 of the act, and specific Instructions are given In sections 9 and 10 as to their description. In deUll. In both the application for the license and in the license itself. The clear and necessary pxirpose of such provisions of the statute can only be to define the subject matter to which the Commission's jurisdiction and the licensee's responal- bUlties attach. Reference to the application and license show no mention of the dam as a part of the " project works " to be con- structed by the licensee. On the contrary, they show that the dam was to be constructed by the Government and Its use for hydroelectric pvirposes leased to the licensee, subject to the re- quirements for navigation. Therefore, licensee hod no authorlza- tlon to construct the dam nor any responslbUity in respect to It. At the time the license for this project was negotiated. It may have been feasible, as Is often done, had licensee so desired, to have Included the dam In the project. In which case licensee would have had the direct authority and responslbUity for constructing the dam and Its cost would have been a proper charge to the fixed capital of the project. But this was not done, the licensee electing to confine Its construction activities to the hydroelectric project proper. Therefore, any responslbUity It subsequently as- sumed with reference to work extraneous to the project, with the hope that It might benefit the project, was osstimed at Its own risk In Its capacity other than as licensee, and any resultant loss iB not. under the law, a part of the cost of the project. To adopt any other rule than that of restricting the commto- slon's jurisdiction and limiting the licensee's llabUltlea to the project, would open the door to a confusing maze of activities and consequences. ^. ,. ^ . »w -• _ But if arguendo. It Ls assumed that the alleged loss on the dam has legal and proper relation to the cost of the project works, the facts and arguments offered by licensee m support of the claim are neither convincing nor persuasive. Licensee's brief lays emphasis upon the contention that the Byllesby Service Co. became a bidder for the dam contract at the urgent request and solely for the Intended benefit of the licensee, and hence should be protected against loes. It Is argued that the Byllesby Service Co. " was very loath to undertake the building of this dam and as a condition to lU so doing It In- sisted upon and received from licensee a guaranty" and again, that " the licensee prevaUed upon the ByUesby Service Co. to un- dertake the construction of this dam." Remembering the com- mon control of the two companies, the identity of their officers aa shown In the chart, supra, and that It U admitted that both were dominated by common directors, the argtmient that one waa " loath to undertake " and that the other " prevailed " is specious, for It assumes an independence of action which admitted facU refute. PrevaUlng Is done from the top downward, not from the If l^nsee had the legal right, even asstimlng It had the power, to induce the Byllesby Service Co. to buUd the dam and guar- antee It agairust loss, then, however long the delay or great the damage from fioods, ice, or vicissitudes beyond control, the licensee would have to stand the loss, even though It may have been a mUllon dollars instead of the sum claimed. If licensee may under the act undertake work or risk ouUlde the limits of the project itself. It may do so anywhere along the line from the point of const'rucUon to the pUce of consimaptlon of Its power. For In- stance If licensee had hod a profitable contract to furnish power to a raUway company aa aoon aa the job of electrifying the railroad 124 CONGRESSIONAL Record— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 425 directors of utllluea. such as the licensee, hold positions of truit cate a finding and determination upon the tendered secondary 424 CONGRESSIONAL RECORD— SENATE was completed, and If It feared that the contractor the railway company might employ would not complete the electrification of the railroad by the time the project was ready to furnish power, then, under the rule Invoked by licensee, it would be equally Justified In Inducing the Byllesoy Service Co.. by an underwrit- ing, to bid low enough to get the electrification contract. Such an elastic rule might be further stretched to include the building, lis well as electrification, of the rtillroad. One of the dangers and uncertainties of this rule Is Its depend ance upon the fears of licensee as to what might pos-^ibly happen under an Independent contractor, however competent, and leaves no practical basis for licensee's Judgment or Commission determination. Licensee's contention that it was highly Important to It that the Byllesby Service Co , already having the contract for the project should also construct the dam. is based upon a recog nlzed principle of economy through coordination of construction work. But the argiiment here rests upon an assumption, un- supported by any evidence whatever, that any other contractor which might have been employed by the Government would not have cooperated In coordinating the work on the dam with that on the project. Nor is there factual basis for the further argu- ment that no other contractor ihan Byllesby Service Co. w^ould have brought the dam work up to a safe stage before the winter season, thus affording protection of the project works from possible floods and Ice Jams The evidence shows that both contracts were let at approxi- mately the same time, that the project and the dam were side by side and physically related, that both Jobs required, in large part, the same kind of construction equipment, materials, and labor, and that delay on either Job would have been reflected in increased costs of both. No sound reason Is apparent for finding that the Byllesby Service Co. had greater economic urge than another to coordinate, plan, and work against losses contingent upon avoidable delay or upon failure to cooperate In fact, it would appear that any other responsible contractor would have had a most impelling added incentive to .tvoid such delays and losses, since It would not have had a licensee contract to Insure against such loeses, and to guarantee a profit, as the Byllesby Service Co. had. In further support of this claim the licensee contends that Byllesby Service Co. saved it a substantial amount In Its Inter- est account during construction and enabled it to earn reve- nue earlier, through the complctlcn of the dam ahead of the contract period. This may be granted, but there Is no evidence, except the licensee s apprehensions, that another contractor would not have finished the dam as promptly as the Byllesby Service Co. It Is a matter of common knowledge that Investment in working capital for equipment, materials, latwr. overhead, etc.. a necessary element of cost In construction work, la redxiced. and the profit thereby increased, by pushing the work to an orderly and prompt completion. It cannot be assumed that another contractor would have been either ignorant or unmindful of this A B C of construction economics. (11) 11 for no other reason, the Commission should disallow the item In question because it is based on considerations alto gether too conjectural and speculative to afford a basis for regu- latory action. The arguments that another contractor would not have completed the dam as expeditiously, would not have co ordlnated the work on the dam with that on the project, that the approaching winter season ml^ht bring floods and ice jams which the then stage of project construction might not withstand — all these are but recitals of licensees imagined difficulties and losses, crossing phantom bridges it never got to. To allow this claim it would be necessary to appraise the value of things which might conceivably have happened under circumstances which could have e.xtsted, but did not. The courts have been unwilling to be guided by considerations less speculative than those advanced in this case. {Knoziille v. Knox^yiUe Water Co.. 212 U.S. 1; Tagg Bros. A More- head v. U.S.. 29 F. (2d) (750). affirmed 280 VS. 420; Los Angeles v Railroad Commission. U.S. (May 8. 1933).) For the reasons assif^ed. the item here in question Is disallowed. COMMENCCMSNT OT OPEXATICN (12) The amounts properly allowable as project costs for Interest and taxes during construction, and for power generated during construction, as a credit against project cost depend in part upon the date when the project can be regarded as available for opera tion. This the Solicitor contends should be January 1, 1928; the licensee May 1, 1928. We adopt the former date as proper under all the circumstances For this purpose we regard that date as proper when In the course of due diligence the project has been sufflciently completed to be reasonably reliable and available for service. Not merely Its technical physical functioning, but the nature of the use for which it Is designed and Its adequacy to meet the btirdens such use entails are factors to be considered. This project was designed and built to furnish secondary powei only. EKie to the caprices of the Ohio river, the plant is totally disabled for considerable portions of each year either from higb or low water. For primary power during such periods, and in emergency at all times, the Louisville Gas & Electric Co. ol Kentucky, an afllllate through whose system the project output is distributed, maintains a steam generating plant at Waterside, a short distance up the river, adequate in capacity and at tendance to take over at short notice the entire load of the project. The means provided and preparations made tor this puipoM irer* dereloped In detail in evidence, with volumlnoui January 11 1934 CONGRESSIONAL RECORD— SENATE 425 exhibits recording the situation dally at both plants throughout the p>erlod In question, and for comparative periods before and after. Upon its full consideration we are convinced that by January 1. 1928. the project had been demonstrated capable of discharging Its Intended function as .a producer of secondary power. While there were some suspensions thereafter of the entire plant for lack of water, and of particular machines for certain supple- mental construction processes, such as pointing, installing eafety devices, and certain mechanisms for greater convenience in op- eration, the loss of generation from the latter causes was minor; and in each case the necessary load was promptly absorbed by the Waterside plant, in accordance with the operating relation- ship Intended between the two plants. INTEHEST DtTHING CONSTHUCTION (13) The allowance of Interest during construction is authorized by section 3 of thp Federal Water Power Act. which incorporates " insofar as practicable " the '• Classification of Investment in Road and Equipment of Steam Roads, issue of 1914. Interstate Commerce Commission." The Federal Power Commi.ssion's sys- tem of accounts prescribed for licensees provides, under Account 394. for the Inclusion in the capital accounts of reasonable charges for interest during the construction period on the licensee's own funds. This accounting regulation corresponds to the Interstate Commerce Commission's Account 76. " Interest During Construc- tion." ^ ^ What properly constitutes the construction period is to be determined upon the facts and circumstances in each case. The licensee claims January 1. 1924. as the beginning of the con- struction period and the evidence shows, the Comml.sslon finds, that construction began on that date and continued with due diligence thereafter. The Commission having found January 1, 1928. to be the date on which the project was available for serv- ice, it follows that Interest is allowable from January 1. 1924, through December 31. 1927. The interest claimed by the licensee Is $525,744.44. Interest was computed at the rate of one half of 1 percent per month on con- struction balances totaling $8,309,522. The Commission finds that, under all the circumstances, the rate of interest of 6 percent per annum claimed by the licensee is not unreasonable and is there- fore allowed. The project construction was financed by advances from the Louisville Gas & Electric Co. on an open-account basis and Interest computations were made upon such advances, but the licensee having been engaged in construction activities other than these pertaining to the project, it becomes necessary to separate the project from the nonproject expenditures. Thus by the elimi- nation of the principal amounts of nonproject charges upon which Interest claimed was computed, the Interest properly allowable under the act may be determined. The first nonproject cost item deductible Is the charge covering work orders C-9. C-16, and C-13, amounting to $563,439.47; the next nonproject charge eliminated Is under EC 806 of $174,965.50; a further item represents several nonproject charges in the form of payments to the Byllesby Service Co., including the dis- allowed feo, supra, in the total amount of $514,260.91; and items representing miscellaneous nonproject charges which have been disallowed by the Commission aggregating $29,415.23. The Interest on the total of these Items. $1,282,081.11, must be deducted from the Interest claimed by the licensee. By a stipulation between counsel for the licensee and the Solicitor, and approved by the Commission, the method of com- puting Interest during construction Is that used by the examiner In the preliminary accounting report. Having determined the amount of nonproject construction in- cluded in the advances for all construction undertakings, it be- comes necessary to determine the portion of interest applicable to the nonproject charges. This is accomplished by dividing the open-account balance ns of December 31. 1927. $8,309,522. Into the interest. $525,744 47, charged on it during the 4-year period, which produces a ratio of 0.063270117. By applying this factor to nonproject construction, $1,282,081.11. the result. $81,117.42. is the amount of nonproject interest to be deducted from the total Interest claimed by the licensee, leaving the sum of $444,627.05. Therefore, the Commission finds that $444,627.05 Is the proper allowance for Interest on the licensee's own funds during the con- struction period. It should be noted that the annual rate at which Interest is computed is 6 percent on all amounts charged, computed from the month In which incurred. The other rate referred to (0.063270117) Is merely the arithmetically resulting ratio of Interest to construction charges covering the whole 4-year period. ATTORNEYS' FEES AND EXPENSES (14) The licensee claimed as a part of the cost of the project the sum of $2,900 paid as retainer fees to a firm of lawyers In 38 separate vouchers from 1923 to 1928. For lack of satisfactory evi- dence as to the character of service rendered and the nature of the contract of employment, the examiner wrote to licensee July 12. 1928. for further Information In regard to these fees. No reply was received by February 21. 1931, the date on which the examiner filed his report, and this Item was therefore suspended. In the protest filed by licensee, this Item, with many others, was re- asserted as valid. At a conference between representatives of the Commission and of the licensee in regard to numerous Items in controversy, resulting In the stipulation hereinbefore referred to, the allowance of this $2,900 was agreed to and Identified as item 34 (B-1) in said stipuiaUon. At the hearing the Commission. Inquiring as to the new or additional evidence presented at the conference which led to agreement on particular items, asked attorneys for licensee for Information as to the terms of the Byllesby Service Co. con- tract with the law firm to which this sum had been paid. Rep- resentatives of the licensee being unable to inform the Commis- sion as to this, counsel agreed later to get the desired informa- tion and report the facts to the Commission. Thereafter, counsel for licensee advised the Commission by letter that the law firm was a department of the Byllesby Service Co.. and formally withdrew the claim: for service by the legal department at the "home oflace " is included in the 7 Vi -percent fee contract, dis- cussed supra. The Commission Is unable to escape the conviction that the withholding of the fcMrts about this claim was not through mere inadvertence. It was brought directly to llceiiaees attention by the examiner's letter which was unanswered; and again when examiner's report suspended this Item, a copy being serviced on licensee; and again when licensee filed Its protest, reassertlr\g the validity of the claim; again when It was the subject of a con- ference, resulting In Its approval by stipulation; and once more when the Commission Inquired about It. During all of this time the Byllesby Service Co. knew, and licensee also presumably knew, that the law firm was merely a department of Byllesby Service Co.. collecting from affiliates fees In which the Byllesby Service Co. directly participated. And as bearing upon the good faith in handling this matter It is significant that two members of this legal department were officers In the Standard system. The Commission can do no less than condemn the evasion and con- cealment in connection with this matter. The licensee's letter admitting that the law firm was a depart- ment of the Byllesby Service Co. caused the Commission to reexamine other law fees claimed by licensee and approved by the examiner. Of such other fees we find amounts aggregating $6,000 which, so far as we can determine upon an Incomplete record, are for services rendered by the legal department at the home office, and provided for in the service contract, and this further amount is disallowed. But, since licensee has not had opportunity to be heard as to this $6,000 disallowance, it is made with leave to licensee to apply for further hearing thereon. MOTION PICTURES AND StJPPLIBS (15) The licensee claimed as a part of the cost of the project two items, one In the sum of $8,2(X).02 and the other $756.10. cov- ering charges for airplane photography and making motion pic- tures, and Including films, film cases, motion -picture machine and parts, lantern slides, photographs, reprints, frames, and other accessories. It is contended that the cost of these were a neces- sary complement to the construction of the project. In the stipulation hereinbefore referred to between the solicitor and counsel for the licensee It was agreed that all of the first amount except $1,000 should be allowed and that all of the sec- ond amount except $186.43 should be allowed, leaving a total of $7,709.69 approved for allowance. Upon the facts recited In the stipulation the Commission Is unable to approve this Item of the stipulation and the said amount is therefore disallowed. But Inasmuch as licensee, at the hearing, relied upon the expected approval of the Commission of this stipulation and therefore introduced no evidence in further support of this item, this disallowance is made with leave to licensee to apply for further hearing thereon. The Commission recognizes the value of modern photography as a medium for the conveyance of ideas of design and methods of their execution, and also the historical value of such a panoramic view of the various stages of the construction processes and the probable subsequent use which may be made of such photography by engineers, designers, and contractors. But the licensee was engaged in the construction of this one project and the direct benefit to such project from such photography does not satis- factorily appear from the record and hence such costs cannot be approved as a proper and necessary expense in the construction of the licensed project. It is not doubted that this photography would be of benefit to engineers and contractors in the future in the construction of hydroelectric projects and that It may have laige value to an organization like the Byllesby Service Co., which Is engaged In the busine.ss of designing and constructing such plants, but the licensee should not have Incurred this expense to create records for future use by others than the licensee. PtTBLICITT EXPENSE, HANDLING VISITORS. ETC. (16) The licensee claims $3,285 as a proper project cost Incurred for a banquet given to foremen and bosses In construction of the project and of United States Dam No. 41. This item was included In the said stipulation, agreeing that this expense, If allowed, should.be divided In the proportion of seven ninths to the project and two ninths to the Government dam and that " it is agreed that if the purpose of this expenditure Is deemed appropriate, the amount thereof Is reasonable. It is further agreed that this Item may be determined by the Commis- sion upon this stipulation and other matters of record before it without further hearing." The Commission holds that a banquet is not an appropriate or proper part of the cost of a public-utility project, and thU claim is. therefore, disallowed. Licensee contends in support of this claim that the banquet was given in fulfillment of a promise made to encourage the speeding up of construction in order to raise the substructure above the level of winter floods so that oonftruetlon could be carried on through the winter, and that this purpose was acoompltshed. It appears from the record that this banquet waa not limited to the foremen and bosses but included city and other public officials, many members of the chamber of eoounerce, and other citizens, to the total number of about 500. To approve siich an expenditure as a proper project cost would, in the opinion of the Commlsaton. not only be without authority in the act but also open the door to " good will " advertising. Consumers may not properly be re- quired to pay for hospitality they do not share. (17) A further sum of $7,899.03 is claimed by licensee as a proper cost of the project, covering several expenditure*, as follows: The sum of $1,446 represents the cost of erecting an outdoor observation platform from which visitors might view, with safety, construction operations. The Commission allows seven ninths ot this item. $1,124.63, and disallows the remaining two ninths. $321.37, as properly allocable to the United States dam project. Another item of $2,000 representing salaries of guides for the further protection of visitors is considered proper, and seven ninths thereof, $1,555.55, is allowed, the remaining two ninths. $444.45. being allocable to said United States dam construction. In allowing these two items the Commission recognized the legal duty of the licensee to take reasonable precautions and to provide reasonable means for the protection of the public against personal injuries. Upon all the evidence the Commission finds that the erection of the observation platform and the furnishing of guidee was In the discharge of the licensee's duties to the public and that these provisions for the public safety cost substantially less and were more effective than the alternative of fencing and policing the construction area. (18) The $4,463.03 remaining of the total item of $7,899.03 covers, insofar as the Commission is able to determine from the said stipulations and an inc(»nplete record as to the facts, miscellaneous expenditures, some of which are disallowed because made subsequent to the date on which the Commission has found the project to be available for service, and the others because of the pi^rposes of such expenditures. It appears that a large part of this item covered the rental of busses for transportation of visitors to and from the project, the serving of lunches, soft drinks, cigars, and other forms of entertainment in no sense appropriate to or proper for inclusion in capital structure of the project. When the licensee provided safe platforms and guides for visitors, herein- before approved. It discharged its full duty under the law to the public, and any added courtesies must be borne by the company in its capacity other than as licensee of this project. For the reasons assigned the said claim of $4,453.03 is disallowed. KENT.U. OF NONPROJECT LANDS (19) The licensee claimed $34,120.69 as rental for nonproject lands owned by licen.see and used In connection with construction activities This land is not within the project boundaries as defined in the license, but it is proper to allow a fair reptal for the 3 years it was used for construction activities. The Amount claimed as rent is equivalent to 10 percent per year, or 30 percent on the cost of 99.96 acres. The examiner reported that only 80.67 acres of this land were actually used, and recommended the allowance of 30 percent on the cost thereof, or $18,180.26, and suspended the balance of the claim. $5,94043, as represenUng the 30 percent on the cost of the unused acreage. In the stipulation previously referred to It was agreed that the amount suspended by the examiner, $5,940.43, should be allowed. The Commission is unable to approve the stipulation upon the evidence before it, nor does it approve the 30 percent as a fair rental for 3 years. The Commission is of the opinion that while licensee is en- titled to a comjjensatory rental on Its nonproject land actually and necessarily used for construction pvtrposes, it is not entitled to a rental above carrying charges on Its own lauds used to con- struct Its own project. And as 6 percent is the Interest rate claimed by licensee, and approved by the Commission, on its own fimds furnished for all other purposes during construction, this rate. 6 percent, plxis 2 percent to cover taxes, will, in the opinion of the Commission, fully compensate for all carrying charges on the cost of said 80.67 acres. Therefore, the Commis- sion allows 8 percent of the cost of the 80.67 acres, as shown in the record, eimountlng to $14,544.21, and disallows the balance of the claim, $9,576.48. But as licensee, relying upon the stipulation for allowance of Its claim, presented no evidence at the hearing In support thereof, this disallowance is made with leave to Ucensee to apply for a further hearing on this Item. KISCEI^LANEOtTS DISAIXOWANCES Under a stipulation, an item classified as local engineering and superintendence and known as " no. 13 ", in the total amount of $5,245.74, was disallowed. Another item classified as accoimting. auditing, and clerical expenses and known as " item no. 14 " in the sum at •427.76 was disallowed under the said stipulation. (20) The Commission has approved both of these stipulations. Included in the said two amounts as originally claimed by the licensee as proper project costs are amounts which represent expenses of engineers and other employees of the Byllesby Service Co In attendance upon varloiis conventions. The Commission Is unable to understand why the licensee should have considered such espendltiires as having any direct or proper relation to the cost of the project under consideration. The attendaiHse of em- ployees of the service company at such gatherings doubtless has 426 CONGRESSIONAL RECORD— SENATE his It real t»1u« to the Bylleaby Service Co.. th*»lr employee, but 1o charge such expetvMe to the coat of thla public-utility proJe<:t appears to the CommlMlon to be without any aemblance (»f JUAtlflcatlon. To include euch expendltiurs In a statement of coat nled und^r oath tends seriously to impair the assurance of accuracy and go<^ lalth which such a statement should Import. I Prom the Washington Herald. Dec. 30. 1933] CUSBING THE POWKM TRUST In urging governmental control to avert the " grave economic and social peril" presented by the Power Trust's dynastl«:8 )' holding companies. President Roosevelfs newly reorganized Fed eral Power Commission points the way to a long-needad reiorii Congress and the State legislatures should enact laws, as tli Commission recommends, to control these unregulated coiponi tlons. which all too often plunder investors with one hand wh^ overcharging consumers with the other. For the first time in the 14-year history of so-called " regul tlon of water power ". a Commission entrusted with this regul tion enunciates conserving, constructive, and promising princlph And likewise, for the first time, there is in the revitalized agen led by Chairman Prank R. McNlnch a commission competent ai sealoua to carry out these principles — a commission that m prove to be the " tribune of the people " that President Roosev* has been seeking. Frequently heretofore the Power Trust regulated its regulate In regulating them and failing to regulate itself it ruined i Investors, robbed its consumers. It did about everything but the goose that laid the Power Trust's golden eggs. Economic waste flourished side by elds with financial profiteer Ing and political oppression. These abuses must be suppressed In planning for the truly electrified America which the Roosevelt adm^lnlstratton is bsgtniLing to build. The abuse* and the peril inherent In the Power Trust holdl^ companies are illustrated forcefully by Mr. McNinch and fellow commissioners in a decision affecting the Byllesby syste^ which boasts assets of $1,200,000,000 and has dependent upon for utility service 1.648 communities. This system the Commission aptly characterizes as a " holding company dynasty— not exceptional but typical — with abs« ownership and management and sovereignty over far-flung minions in many States, but subject to the direct Jurisdiction of none." In the claim of cost of a water-power project submitted by system subsidiary, the Commission disallows $3,286 spent up^n a banquet, saying: Consumers may not properly be required to pay for hospitality they do not share." It might Justly say the same of Investors. Disallowing a fee of nearly $500,000 charged by th Interests for supervising themselves, through an affiliated poration, while they built a power plant, the Commission that In 6 years the system has made, on such fees, profits of than $10,000,000. The Commission declares: •■ Such profits resulting from holdlns-company control and tercorporate contracts are not only unreasonable, but shccki whc^n ccnsidercd in the light of their direct Influence upon business affected with a public interest." At last, apparently, we are going to have a watchman to gxiai-d the national water powers that have been grabbed by the Pov er Trust under long-terra leases and exploited heretofore to tHe Power Trtist's own taste If Congress and the State lei^lslatures do their part, we m^y also curb, at least, the Power Trust's holding-company racket. KND OF THE DEPRESSION — STATEMENTS BY W. W. ATTERBURY aKd HENRY FORD Mr. ROBINSON of Arkansas. Mr. President, I ask thai a brief statement by Mr. W. W. Atterbury be printed in tie Record, and also a United Press dispatch, quoting a statie ment by Mr. Henry Ford. There being no objection, the statements were ordered to be printed in the Record, as follows: (Prom the New York Times. Sunday. Dec. 17, 1933) DsraxssiON Ove«. ATTKasuaT Holds — Railroad Man Ubgxs Fatth in ROOSKVZLT — Gbts Mxsai. Or Pkjonstlvaioa Sociztt is la at Gdn- Byllesl >y car- notBs more li- The country has emerged from the depression and business Improving. Oen. W. W. Atterbury, president of the Pennsylvai^la Railroad, told members of the Pennsylvania Society last night the organization's thirty-fifth annual dinner in the Waldorf eral Atterbxuy received the society's gold medal for distinguisl^ achievement. BOLUS SLUMP IS om " We arc just out of the trough of the greatest depression country and the whole world have ever seen ", Oeneral Atterbi^ry said. ** We see all sorts of ' isms ' being tried in various parts of world. Ther* is communism, fascism, national socialism. what not. My own conviction is, however, that in tlM long January 11 ikls Ihe atul nin. out of all these ' Isms ' we shall find that Americanism — old-fash- ioned, rugged Americanism in its best sense — wiU be the * lam ' that will emerge triumphant. " What do I mean by Americanism? I mean, above all things, the maintenance of national institutions which give the largest possible opportunity for the development of the best there is in each individual. You may call this ' rugged individualism ', and yet rugged individualism does not mean giving to any individual the right to pursue a life solely devoted to his own Individual ag- grandizement without reference to the rights and welfare of other individuals which make up our great people. But there is a very great difference between the maintenance of this kind of rugged Individualism and any effort at the regimentation of Individuals. I do not think the people of this country want a regimented life. HOLDS CAPrX.^LISM SAFK " The popular uprising against prohibition was. In my Judgment, at heart a rebellion on the part of the whole American people against any effort to interfere with the fundamentals of personal liberty. " People tell us that this depression has shaken the very basis of capitalism. I do not believe that it h.as. It Is In that disbelief that I have been glad to Join with the great army of our Amerlcau citizens who are supporting the policies of the President of the United States in his e5[orts to pull this country out of the de- pression. " I am an enthusiastic believer in the patriotism, the courage, and the resourcefulness of FYanklin D. Roosevelt. Though a strong Republican in my political affiliations, I have felt and still feel that this Is no time for the assertion of political partisanship. It Is time for the whole Nation to pull together behind the Presi- dent. " I do not believe it Is a time for gloom. And this sentiment on my part is not whistling to keep up my courage. Business is Improving. More men are being employed. Goods are moving Into consumption. The purchasing power of the farmer is already vastly Improved. The whole attitude of the people is changing. I am confident that next year is going to be a better business year than the one we are now completing." [From the Washington Post, Wednesday, Jan. 10, 10341 " Depression Over ", Ford Quoted, Opening Plant Dallas, Tnx.. January 9 (United Press). — Henry Ford is "con- vinced the depression Is over ", C. B. Ostrander said today in an- nouncing the Dallas Ford plant will reopen February 1. employing 2,000. Ostrander. branch manager, said the plant would open on a schedule of 250 cars a day, with a pay roll of $300,000 a month. FIAT MONEY — VIEWS OF AMERICAN FEDERATION OF LABOR Mr. VArroENBERG. Mr. President, the Associated Press summarizes the attitude of the American Federation of Labor in respect to inflation and fiat money. I ask that the article may be printed in the Record. There being no objection, the article was ordered to be printed in the Record, as follows: Fiat Monet Fear Voiced bt Labor — Recovert Gains Cited. Btrr Inflation Mat Wipe Out Progress, Leaders Say Business year prospects for 1934 were pictured today by the American Federation of Labor as "brighter", but " ovcrshado.vcJ by a danger which may destroy all progress made — inflation by flat money." " Fear of inflation Is the chief obstacle to restoration of confi- dence at present ", the Federation said In an annual review. • •••••• "All these gains show progress, but we must not forget that In November 10.702,000 workers still had no Industrial employment; that C.W.A. funds giving temporary work to 4.000,000 will be ex- hausted by February 15; that business Is still 30 percent below normal; that the out'.ook Is overshadowed by a danger which might destroy all progress made — inflation by fiat money. ■• These business advances are due almost entirely to Govern- ment measures, not to private Initiative. • • • To this Gov- ernment credit we owe a large measure of our progress toward recovery. • • • " Government credit does not replace private credit extended In the normal way through banks. Barring a revolution in our ways of doing business, we cannot expect industry to revive until credit begins to flow in large volume from banks. • • • " To start private initiative and put back to work 10.700.000 workers still without industrial employment, business confidence mixst be restored. Fear of ii\flatlon Is the chief obstacle to restoration of confidence at present. • • • " The effect of fiat money inflation at present would be to take from the workers any Income gains they have had and put in- creased wealth and power In the hands of rich property owners. Uncontrolled Inflation could destroy the effects of the recovery progiam. " History shows that In the past flat money has usually been issued to meet an overwhelming Government deficit. Large Fed- eral borrowings In the last 3 years have alarmed many who fear that the Government will not be able to pay ofl its de'ots except by issuing flat money. • • • 1934 CONGRESSIONAL RECORD— SENATE 427 " Hlctory shows no example of uncontrolled inflation in a ooun< try with a large gold reserve. Our gold stock at present is the largest of any country in the world. • • • It is far more than enough to support our present paper currency. These facts show no reason for flat money inflation because of the public debt." ECONOiaC CONOITIOMS ADDRESS BY SENATOR DICKINSON Mr. PESS. Mr. President, I afik unanimous consent to have printed in the Record an address delivered by the senior Senator from Iowa I Mr. Dickinson] before the League of Republican Clubs of Cuyahoga County, Ohio, at Cleve- land, on January 6, 1934. There being no objection, the address was ordered to be printed in the Record, as follows: It Is a real pleasure to be present at this splendid gathering of working Republicans. If I were to ask any pledge of you tonight. It would be a rea.ssurance of confidence in the record and the traditions of the Republican Party. The Republican Party Is progressive enough for advancement and yet conservative enough for safety. Let us continue to be a party under the Con- stitution and not against It. Many governments have failed, not because they did not do enough for their people but always because they attempted to do too much. The Constitution of the United States Is not a re- striction on liberties but rather a protection of liberties. When we exceed Its privileges, we are on dangerous ground. The Democratic leglslatU-e program may be an experimental program, but one experiment may lead to another until no retreat is possible. Experiment Is leading us far astray. Most of the problems now confronting us are the problems of the Individual and of the State and Its subdivisions. Yet we hear the continuous cry — " Why does not the Government do some- thing? ' We ask the Government to plant our gardens, to plow our fields, to control our Industries, and run our stores. The sooner we regain the self-consciousness that these are the prob- lems of the individual and not of the Government, the quicker a safe road to recovery will appear in the foreground. Our party should be committed to the principle as established by our forefathers. The preamble should become our golden rule. " We the people of the United States. In order to form a more perfect Union, establish Justice, Insure domestic tranquillity, pro- vide for the common defense, promote the general welfare, and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this Constitution for the United States of America." Tills has been revised In the " new deal " and now reads en- tirely differently. At the present time, if I were to write a pre- amble to fit Into the present-day program, it would be as follows: " We, the people of the United States. In order to test the sta- bility of the Union, and to divide one section against the other, to endanger Justice, to insure domestic discord, to retard the general welfare, to endanger the civil liberties of ourselves and our pos- terity, do ordain and establish the A.A.A., C_A.B., C.C.C., C.SJ3.. C.W.A.. EC PC. E.HJ.A.. F AC .\., F C.A., F.C.T., F.D.I.C.. F.E.RA.. P.HX..B.B.. P.S.R.C., GBC, H.O.L.C, lA.B.. I.BJI.T., I.T.P.C, L.A.B.. N.C.B., N.E.C.. H.I.RJl.. NJ.R.B.. N.L.B.. N.P.B , NJl.A.. P.W.A.. P.W.EJI.C.. S.A.B., S.B.P.W., SJl-B., T.CJF.T., T.V.A." Many of these had no foundation In legislation whatsoever. They are the result of Executive orders — Illegitimate stepchildren of an ill-advised law whereby the legislative body surrendered its birthright and delegated legislative authority to the Executive of the United States. We are at present the victims of such delegated authority. Pressure on Congress put through many measures transferring authority from Congress to the Executive — a cowardly procedure. Those governing us today were not elected to office. Johnson was not elected by the vote of the business men, nor Davis by the vote of the farmers. This has all been brought about by a delegation of power. return to rUNDAMENTALS The Republican Party should stand for a return to fundamen- tals. The theory that any particular policy of any particular group Is responsible for existing conditions is erroneous. The present-day depression Is the result of the sins of society Itself. The individual Increased his exjjendltures; he took on extravsigant habits; he gambled large stakes on uncertain gains; he lived beyond his means; he bought on the installment plan and spent next month's salary this month. This was destructive to the understrata of society itself. The same program was adopted by the municipalities of our country. Bond Issues were voted, boulevards constructed, pav- ings extended, buildings erected. The expansion program was such that soon the tax revenues were unable to meet the obli- gations. This Is the reason for the demand that municipalities be permitted to take advantage of bankruptcy. This same spirit of spending extended to the States themselves. Many of our States obligated themselves for expenditures b«- jiond the resources of their taxpayers. In fact, it was not solely on account of the manipulations of the stock exchange — although much blame can be placed at its door— It was the gambling spirit In practically every walk of life that disintegrated our economic itructtve. It Is this condition that forces upon the country the necessity for an economic cure. In finding such cure, the Re- publican Party has a keen responsibility. PTTBLIC EBUULATtOlf HO CUM AdmlUlng that our economic society la dlsorfanlaed and Xtomt It has not been properly managed, there is nothing in tbe aasumpUaa that a poUtlcal social control wlU remedy the situation. Tbe Republican Party should stand firm In tbe faith (or individual management and private control ol business and Industry. We can promote legislation curbing dishonesty and restricting monc^Mly. In reply to the suggestion that poUtloal social control Is neces- sary by reason oi the conditions now existing, let us examine the record. What about various businesses that have been vested witb public supervision? Let me call your attention to tbe fact that the railroads have had governmental supervlslcMi for a great many years. This supervision has not saved them from suffering exactly the same plight as practically exery other business in the country. I might also suggest that the banking business has been nxptt' vised by the Government. Probably no business has been more mismanaged and suffered keener loss or more In prestige than the banking business of the country. But the banking business Is regulated. We have bank examiners; we have a Comptroller of the Currency; we have a Federal Reserve Board. No one ever dreamed of putting either industry at commerce under so strict regulations as have heretofore been imposed upon the finances of the country. It has been suggested that the Senate inquiry has " dro^^Md a grappling hook into the mire of some of their (bankers) methods. Fiduciaries at the very heart of financial power and faithless to their trust • • • and insistent that a law to induce fair prac- tice Infringes the Constitution, they are the mouthpieces of the political theory that permitted such practices." But It should be remembered that during all this time these banks were under Government supervision. They were under Government regulation. Even their bylaws were submitted to the Comptroller of tbe Currency for approval. la it not therefore safe to assume that the NJl-A. with Its limitations of authority will not be able to overcome private greed? It will not be able to make economic ansjela out of the sinners of the earth and will be no more successful In managing the business and industries of the coimtry than the Federal Reserve Board has heretofore been In managing the banks of the country. I again contend that Government supervision is no cure for our existing Uls. I further suggest that you investigate the shipping business which has been under Government supervision. All this would Indicate that Government supervision is not a remedy and gives no assurance that industry and btisiness will not suffer the same coUapwe. even if supervised and assisted by the ..guidance of the N.R.A. or any other Government bureau or subdivision of the " brain trust." EXPCRiicnrrs Under existing conditions we need calm, deliberate Judgment. Caution should be our guide. When conditions are most critical, we find a government of trial and error — aU trial and mostly error. I have no patience with the man who says that the ad- ministration at least Is trying something. ThU Is no time for quack remedies. It is much safer to trust experience than experi- ment. We are floundering In a conglomeration of brain storms — brain storms in finance, brain storms of overproduction, and brain storms of excess food supplies — a " brain trust " campaign of prosperity promotion spending billions. Promises — promises — promises. The Government wUl fix wages; the Government wUl raise prices; the Government wlU shorten hours; the Government wUl settle your disputes; the Government will eliminate your competitor. Business from now on Is going to be one continuous round of pleasure — with profits assured and conditions ideal. Everybody Is to be regimented. You are to Imitate the fat merchant of the Elizabethan Age under the merchants' guild, with wealth accumtilatlng and yotir trade asstu'ed. ovmraoDCCTioN Overproduction must be stopped. Farms are to be classified and 40,000,000 acres taken out of cultivation. Factories sire to be segregated— some cloned and some opened. Mitkes are to be listed. Overproduction Is the bugaboo. If too much cotton, reduce the acreage If too many radios, give someone the monopoly, and the 'brain trust ' will close the other factories. Too many lawyers — close the schools. Too many doctors — close the coUeges. Too many profeesors — close the universities. Too many people — try birth control and legalize abortion. BUSIirCSS I.E&IUCXSHIF The greatest tragedy of today is that the leadership oi industry and business, which should oppose the present program of P*^eral regulation and control. U so hresolute and divided in what should be done. If socialism once grips American capitalism. It will never release Its grasp. One of the early conceptions of social reform Is that the state shall control all means of production. There Is nothing new in the present-day suggestions. AU these theories have been tried in one form or another and failed. But a socialist never admits defeat. He win admit that his program has not worked but never admlU that Its failure is on account of a defect In the system. The failure U always because be was not permitted to go far enough and extend his program to complete control of the economic system. Onos the Oovernment begins tbe tMk of oontrolllng •oonomlo relationships, it must oontlnuc. One oommitment leads to tbe next. American caplUllsm in ite present faltering experiment wltli SUte ooBtrd U pUyiag witb the tnass mm. ri 428 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 429 T Im^W <•> ftin ^A* #Ka fii1A11m*nf. nf f\\m nPTkmiM In . IninwMlnir t.ha WM<h at th« TTnttAd Stat^ to the testlmonv Of WOAt noc amj own convmioa w, oowvTvr, vium tn «a« long nm. i py usuing ost inuu«y necwulty for «n economic cure. In nndlng lUOD ourt, tn« h** publican Pftrty hM • keen reeponatbUltjr. wMk 8t*t« ooBtrol U plajlflf with ttic b\ues mw. r'l \ ^ HI 428 ,,. CONGRESSIONAL RECORD— SENATE January 11 tOitl all 1 $00 perchai ice Ihe np- Andiew shales tUat ;he In in ■OCIALIZATKm We are Uktng the first step in land renUls. fkxm ownerahlp WlU beoome annoying. The P W A. set aalde 36 mlUionB to buy final lands. Next we find the theory will work better where land is owned by the Government. Renting lands, step no, touying marginal lands, step no. 3: take all the land, step no. 3 The R P C. is soon to ask for a longer lease on life. Por wh$t? Why. to buy gold at home and abroad. A year ago. If I had In gold in my pocket, I was a law-abiding citizen; if I had a pint of whisky. I was a criminal. Today, if I have whisky I am a law-abiding citizen, but if I have the gold I an criminal violating the law. The R.P C. also wants to buy preferred stock in banking inttifu tlons and. in some instances, name the officers. We are fast proachlng a bank of the United States. Somebody page Jackson. Where are the advocates of SUte righu? The of Democracy grow dim when the legislative leadership of party forsakes every tradition of Thomas Jefferson and of South and surrender to a centralized Oovemment control, finance they surrender to the RJ.C. in industry to the HRJi agriculture to the A-A.A. When this happens, big business becomes the noaster. business dictates your finance. Big business dictates your co< es The antltrxist law Is suspended, and corporate control of buslrsss knows but one god— the "god of profit." The whole deveDp- ment of buslne«i under such control Is for big business to becc me bigger, and the little fellow hunts a place in the breadline. Suijely the •' Prankenateln of monopolistic capitalism " is with us The ultimate burden of such a program falls on two cl the consumer and the taxpayer. One group fixes wages, proi its and prices: another must pay the bill. One group sells Its prod ice to the Oovemment In the form of a loan; another must pay ^♦"» price. How long can our Government last half subsidized half victimized? MOlfXTAXT POUCT The present uncertainty of the administration's monetary po^cy forces capital Investment into hiding. New capital Issues in 1 >33 will be under 91.000.000.000 as against •1.600.000.000 In IS 32 •8.000.000.000 In 1930. and •10,000.000.000 In 1929. No prospei Ity can be realized unless new capital Issues rise to at Ic ast •5.000.000.000 a year. It is impossible to supplant this money wjlth Government funds. A great deal has been said about the Government being able to refinance all its loans to date. Naturally, the Federal Gov- ernment can force the banks to buy Its bonds and then new iss jes can be made against the bonds: but if you follow this policy in- definitely, you turn our banks into Government printing prestes Once this device Is carried to any considerable extent, the do lar may be expected to take a nose dive, and the descent will kr ow no end. There Is only one remedy for excessive expenditures and that is additional taxation. the ind PABTT PBOMISSS AND PnirORMANCEB In reading the platfonns of the major political parties during the last campaign. I find included In one of them the following " We favor an Immediate appropriation of •5.000.000.000 for relief to supplement State and local expenditures and the appro priatlon of an equal amount for public worlcs. including rofds reforestation, slum clearance, and housing." I read fxu-ther and find that this party favors " the creatloii of national, regional, and State boards to determine the best utiliza- tion of rural land; Government ownership of the liquor businuss; i abolition of the power of the Supreme Court to pass on the cjn- Btitutlonallty of legislation enacted by Congress; complete acqn tsl- tlon of the Pederal Reserve banks by the Government: the opera- tion of the power industry by administrative boards; the recogni- tion of Soviet Rxissia ". etc. In all candor. I ask you to compare the program of the prc^nt administration as enacted by the special session of Congress imd aa now being proposed in the regxilar session of Congress with the program above suggested. But wait — I have been reading to jou from the national platform of the Socialist Party, headed by ( or- man Thomas, who received less than 800.000 votes in the ast election. None of these jHtivisions was found in the Democnitlc platform that received over 22.000.000 votes, and none of tlem was included in the Republican platform that received qver 15.000.000 votes. Are the American people being given what they voted fori or are they being subjected to the whims of the " brain trust " led by the theorists with a direct and definite leaning to the lef t| on every proposal? The Republican Party must do iU part in directing the affklrs of this Government. No one knows whether we are still reliei ing the depression or revolutionizing our form of government. Tl ere may be a place where we can call a halt. We find that w len direct authorisation of Congress has not been granted the po^er baa been aastimed by some corporation or agency set up ui^der some provision transferring power to the Kxecutlve. Just now they propose to spend •35.000,000 to buy lands. That matter was never discussed before Congress Is proposed to expand construction in many ways on projects that have not been heretofore authorized by In fact, there is a refusal on the part of the leading member^ the Approfniatlons Committee of the House to concxir in n of the authortsatlona granted by the Public Works Admlnlstra We expand our highway system; we rebuild our Navy; we 10 million dollars in flying equipment: we are encouragixxg mutiic regl< nal It ly Hi. Of ay tn. put muiy Cong] ess tpalltlss. counties, and States to embark upon a system of ex- travagant public expenditure and pay excessive prices in order to sectire a contribution from the Government: but in the end the taxpayers of these respective localities must bear the upkeep of these improvemenU. , The other day an editor friend of mine suggested: A suc- cessful man hereafter will be one who can think up ways to make money as fast as the Government can take It away from him." DEPRESSION We are now facing a •7.000,000.000 Budget. The revenues of the Government, with all the additional taxation suggested. wUl not exceed 3>-a bllllcn dollars. Spending a lot of money seems to be an Inspiration to spend more. This In face of the definite promise July 30. 1932, when President Roosevelt said: " Let us have the courage to stop borrowing to meet continuing deficits. Stop the deficits. " Our party sees clearly that not only mvwt Government Uicoms meet prospective expenditures but this income must be obtained on the principle of ability to pay. " Revenues must cover expenditures by one means or another. Any government, like any family, can for a year spend a little more than it earns. But you and I know that a continuation of that habit means the poor house." The present type of expenditures is extravagant and wasteful. Thirty-four agencies have been set up under temporary authoriza- tions, all of them for the purpcse of spending money. The Republican Party has a direct responsibility at least to warn the country that the end of this path U Pederal bankruptcy and financial ruin. ^ ^ ^^, Every depression passes through three stages. First, the panicky stage of severe decline and loss of confidence and depreciated values. We have passed through that stage. With the rest of the world following a similar course, there was no way by which this could be avoided In this country. All legislation could do was to stem the tide and cvishlon the fall. The second stage for every depression Is a period where we test out all forms of remedies — a few of them sound, many of them unsound. The character of the leadership determines whether or not we try many quack remedies and suggested panaceas, or whether we permit experience to be our guide and confine recovery legislation to remedies fundamentally sound and tested by experience. It Is well to compare the efforts of America with those of England under the present stress. In the United States we are spending money to bring back prosperity. In England they are saving it for the same reason. Naturally, both methods will make some progress. In Great Britain they ask no emergency or extraor- dinary powers. It Is well to remember that the stability of the English course has weathered many tests. In America we are sending up a trial balloon. No one can now predict the expected landing. But it has been said that If we can Increase the economic turnover in the United Statos from •45.000,000.000 to $90,000,000,000 the matter of a few additional billion dollars Indebtedness will be Incidental. The only trouble is the suggested " If." Suppose we go into debt the billions of dollars and do not Increase the economic turnover and must follow the English course of slow, plodding recovery, but still have the indebtedness to pay. It is my Judgment that that is about where the present policy will lead us. The third stage of every depression (and in this the Republican Party is Interested) is the convalescent period. Things do finally settle down. Values become fixed. Confidence Is again restored, and In the end capital again begins to reach out. Every handicap by way of restrictive legislation, every uneconomic nostrum that is imposed upon the public, every time additional restrictions are placed on business, every time you bind an Individual with red-tap>e government regulations, you delay the recovery period as suggested. To me it seems perfectly plain that the Republican Party should immediately commit Itself to a restoration of the Govern- ment to fundamentals and that our fight should be made along this line. BTJTlEAUCaACT The Democratic platform in 1932 said: " We advocate an Immediate and drastic reduction of Govern- ment expenditures by abolishing useless commissions and offices, consolidating departments and bxireaus. and eliminating extrava- gance • • •." President Roosevelt on July 2. 1932. said: "As an immediate program of action we mtist abolish useless offices." He further said: " I accuse the present administration of being the greatest spending administration (meaning the Republican administration) in peace times in all our history • • *." Let me suggest that the last report of the Civil Service Com- mission shows that we have the largest niimber of Federal em- ployees on the pay roll since war times; that we have more com- missions and more bureaus and more administrators than ever have been known to our Government. Wc have a •7.000.000.000 budget facing us. This cannot be explained away by the sugges- tion that we are fighting an emergency. The same emergency faced us when these promises were made in 1932 that faces us now. These same conditions were known to the Democratic Party and to its leadership. The promises made to get votes are at variance with the performances. 1934 CONGRESSIONAL RECORD— SENATE 429 In fact, X look In vain for the fulfUlment of the pronUses in the Democratic platform, but find many promises of the Socialist platform being carried out to the letter. Let me say to the mer- chant, let me say to the farmer, let me say to the industrialist this Is no longer an emergency program, but a permanent pro- gram of political economic control. The Presidents message reads: "That we have created a permanent feature of our mod- ernized industrial structure and that it will continue under the supervision but not the arbitrary dictation of government itself." CONCLTTSION If. In this program that I have Just described, representative government Is to be displaced, if emergency relief is to bring a permanent revolutionary and socialistic change in our form of government, if our lands and forests are to be collectivized, if our Budget is to be forced out of balance, if we are to be sub- jected to every form of panacea that the human mind can sug- gest, then there is a heavy responsibility on the opposition party represented in this gathering here tonight. We should remember and deeply realize that regardless of all the socialistic schemes that have been tried in the world, in the end nearly everybody has to work for a living after all. So let me congratulate the Republicans of Cuyahoga County. I am glad that as said in First Kings. It can be recorded: "Yet I have left me 7.000 in Israel, all the knees of which have not bowed to Baal." To the Republicans in Ohio and to the Republicans everywhere, as has been suggested in Isaiah: "Go set a watchman"; and of these watchmen the country will be continually Inquiring: " Watchman, what of the night? " THE BANKING INVBSTICATION — ARTICLE BY SENATOR FLETCHER Mr. ROBINSON of Arkansas. Mr. President. I desire to ask that an article written by the chairman of the Senate Committee on Banking and Currency, the senior Senator from Florida [Mr. Fletcher], and published in the magazine, Today, under date of December 30. 1933; also an article entitled " Lessons of Banking Inquiry Summed up by the Chairman", published in the New York Times under date of December 31, 1933; and an editorial on the subject matter of the articles, published in the New York World Telegram under date of January 8, 1934, may be printed in the Record. There being no objection, the articles were ordered to be printed in the Record, as follows: [From Today, Dec. 30, 19331 The Futube of the Banking Investigation Early in 1932 there were doubting Thomases as to the work of the Senate Committee on Banking and Currency and its duties. By propaganda and otherwise efforts were made to prejudice it in the eyes of the public and to minimize and discredit its work. The committee was accused of looking into closets for skeletons everybody knew were there, of digging up corpses which the public knew about, of tending to destroy confidence In financial set-ups. of Interfering with business by muckraking, and the like. But the public and the press as a whole, with practical una- nimity, have since shown confidence in the committee. Today all questions of our purpose and the usefulness of our work has dis- i^peared. Those who formerly criticized and undertook to sneer now admit that the work has been well worth while and that there is real need for reforms, corrections, and changes. It is impossible to understand the significance of the present hearings before the Committee on Banking and Currency without going back into earlier Congresses. There have been many pre- vious hearings on financial and economic subjects in both Senate and House without apparently reaching the public consciousness. In 1913-14 the Pujo hearings, concerned with the so-called " Money Trust ", were carried through laboriously under the ques- tioning of Samuel Untermeyer. without producing marked results. Between 1913 and 1932 dozens of hearings in Congress as to stock exchanges, short-selling in general, economics in general, and banking problems have been held. They are scarcely remembered by the public. It was the shock of the stock-market collapse in 1929 that ulti- mately led to the assignment of our duty and that prepared pub- lic opinion for a sympathetic reception of our work. The committee has acted under three major resolutions of the Senate. The first of these. Senate Resolution 84, covered the fol- lowing broad details: A resolution to thoroughly investigate practices of stock ex- changes with respect to the buying and selling and the borrowing and lending of listed securities, the values of such secxirltles, and the effects of such practices. Hearings under that resolution have continued from April 11, 1932, to the present day. They have Involved long cross-question- ing of Richard Whitney, president of the New York Stock Ex- change, as to short-selling and other stock -exchange practices. His attitude at the beginning was almost flippant as to the techni- calities of stock-exchange practices, but he has since shown an admirable spirit of cooperation. It is not necessary or possible to mention all other persons brought in for examination. Reference can, however, be made to Percy A. Rockefeller, who testified as to his participation in various pools, syndicates, and Joint accounts that involved no motive of Increasing ths wealth of the United States; to the testimony of P. H. LaOusrdl*, now elected to the mayoralty of New York City. and the evidence which he produced of publicity In newspapers and publications of New York and other cities purchased by gifts of stock to publicity agents: to the testimony of Walter E. Sachs regarding the Ooldman-Sachs Co.. the Ooldman-Sacbs Trading Corporation and other Investment trusts. Involving various food producu, and the total operatlozu of which resulted In a loss of •60.000.000, at least; to the tesUmony of Harry IL Warner and others regarding the motion -picture Industry and its rapid expan- sion through the rtish of investments from a public deluded as to the dependability of leaders in the industry; to copper stocks, both domestic and foreign. Under the authority of the same original resolution ths Kreuger & Toll investigations showed Donald Durant, as repre- senting Lee Higglnson &; Co.. in the unfavorable light of directing a •60,000.000 investment without ever attending a directors' meeting. These hearings were held on January 11 and 12 of the present year, but still under the authority of the Seventy-second Congress. Then came the InsuU hearing* from February 15 to 17, inclusive. At this point it is right to say that the testimony showed the creation of so many organi- zations pyramided on each other as to be beyond the compre- hension of Owen D. Young, of the General Electric Co.. as he testified, and beyond the control of Samuel InsuU, Sr., before he and his brother, Martin Insull, temperarily left the United States. Under the same resolution investigation showed the com- plicated weaknesses of the National City Bank in its relation to Its afllllate, the National City Co. These revelation* began to im- press the public as a whole with the fact that this committee and its reiwarches were approaching practical results that could safe- guard the investing public. It was these hearings that fully showed up the wrong of bank directors having control of com- mercial deposits and yet having direct personal interest, not only in stock investments, but in stock speculation of the moRt arrant character. I do not hesitate to mention here the undoubted fact that the testimony of Charles E. MitcbeU in February of this year will prove to have been the turning point In the willingness of right-thinking people to purify the financial activities of the United States not only as affecting banks, banking practices, and bank speculation but also as efiecting stock-exchange practices as hereafter to be kept distinct from banking practices. The other major resolutions under which this committee has operated are Senate Resolutions 56 and 97, which gave our com- mittee authority to Investigate the matter of banking operations and practices and the issuance and sale of securities and the trading therein. Prom that authority we have secured for ths public a fuU understanding of the operations of investment bank- ers, very specifically J. P. Morgan & Co. and Kuhn, Loeb it Co. Out of the Morgan hearings came the testimony of O. P. Van Sweringen, proving in the main that by means of a credit or loan of •1.000,000. the Van Swerlngens were able to build up. with the contributions of the speculative public, that which can best be described as a " railroad kingdom." The Van Swerlngens used va- rious corporate forms, some of them confusing to the public, because they operated under various names of investment trusts and holding companies, one of them at least designed to evade the tax laws aC the United States. Out of the Kuhn, Loeb testimony came a surprising revelation regarding the Pennroad Corporation that, in the form of an invest- ment trust, actually contravened the regulations of the Interstate Commerce Commission as to a consolidated management of cer- tain railroad systems that should have remained separate in their control. Here again the holding company plays its part. Under Senate Resolutions 56 and 97 also, we have investigated Dillon. Read & Co. and have shown, in part at least, the condi- tions by which the public of America were misled in both United States and foreign securities. The Chase Bank hearings Just completed brought evidences into light that the errors and evils of banking affiliates as opened up by the National City Bank hearings, had already affected, in ad- vance of new legislation, the banking thought of America, lead- ing to the gradual termination of affiliates in liquidating their resources and to their immediate elimination so far as new busi- ness or endeavor was Involved. It is expected the hearings will be concluded by or during Jan- uary 1934. Because our final report will not be available till then it would be premature even to outUne the possible conclusions of the committee. However, some definite results In the form of valuable and Im- portant legislation already written into law by Congress have grown out of the hearings. They should be mentioned here. First is the National Banking Act of 1933, which contains restric- tions against loans for speculative purposes. It will be recalled that Ln 1929, funds were drawn from banks In all portions of the country and were syphoned Into New York to the extent of billions of dollars, attracted by high rates of Interest, reaching at ttanes above 20 percent. Theae were known as " brokers' loans " smd went into speculation in stocks and other securities. The Bank- ing Act wiU check or stop this sort of thing. We found the operation of banks through affiliates was a dangerous, vicious thing. In dosens of ways w* established the need of separating affiUates from conunercial banks. The func- tions of investment trusU and trading corporatloos are entlrrfy distinct and outside real banking. Commercial banks should be I and must be confined to their legitimate functtons. This act takes care of that. It may be amended to go furtlker. as ttoe head 1 of a large national bank now reccnnmends. 430 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 431 ^vcw WV AW0 ««« A^AOJ4AL YIt •xp&IUI our ui^uwBj eyswrta, we reouuu uur navjF, wc 10 mt'""" dollars In flying equipment; we are encouraging mu^ilc- | with the performances. t 430 CONGRESSIONAL 5. t The second act passed at the last session, based largely on d< - velopments by the committee. Is known as the "Securities Act of 1933." Of course. It was to be expected that such a reformatory and far-reaching piece of legislation would meet with a storm (»f criticism by those whom It was designed to reach and restrain or put out of bxislness as enemies to the Investing public. The kind of recovery the majority of stock brokers have wantse8 above ethics and fair dealing. Some directors of corpon- tlons pocketed their fees as recompense merely for the use of the Ir names, as was shown by H. L. Stuart In the InsuU hearings, and more particularly by Samuel Insull. Jr., who did not know heople get right down to the funda- mentals of marltets. The best definition that I know of what makes a bull market and a bear market is given in a book by Walter Bagehot, who was. as you know, governor of the Bank of England and wrote Lombard Street : ' When a lot of very stupid money gets into the hands of a lot of very stupid people, you are going to have Inflation and speculation and boom; and when a lot of very foolish p)eople have spent a lot of very foolish money, you are going to have deflation, depreciation, and panic' " BLAINE ON SPECULATION Senator Blaine. In one of our hearings, quoted President Hoover on speculative fevers as follows: " In such cases 99 percent of the capital raised comes from persons who buy shares, not on any knowledge of the enterprise beyond Its market nickname but because of the fullness of hope that they may resell the shares to some other outsider on the following morning at a higher price." Furthermore, we shall be able to show that stockbrokers, as a | whole, are interested scarcely at all In forms of permanent Invest- ment, but are chiefly Interested In stirring up market activities — in and out. buying and selling, lifting and depressing prices, etc. — so as to secure fees or commissions for buying and selling. We shall also be able to show that the public mind has been in- fluenced in the past few years by "old counselors" (see Halsey, Stuart & Co. testimony), by college professors, by creditable and discreditable periodicals, and by tipsier sheets, market circulars, etc., seeking to persuade the public away from permanent In- vestment in bonds to speculation in stocks. Between January 1 and December 31, 1929, 1,124,990.980 shares were traded In the New York Stock Exchange a. an estlirated gross result In commis- sions of $191,248,553. Commissions on bonds during the same period were estimated at 17,550,000. We shall also be able to show that through new flnanclal de- vices the Investor himself has been pushed further and further away from any voice or control In some of the larger corporations, through voting trusts, pyramiding corporations on corporations, and Investment trusts. In this direction nothing quite so dis- turbing was shown as the Intercorporate holdings of the Insull group; Samuel Insull. H. L. Stuart, and Samuel Insull, Jr.. being voting trustees for the securities of corporations in many parts of the United States, running up to several hundred millions of dollars, all under one control or contributing to that control. Just to name a few will refresh the public mind: The Corpora- tion Securities Co. of Chicago. Insull Utility Investments, Inc.; Public Service Trust. Public Service Subsidiary Corporation. Util- ities Securities Co. There were dozens of others. Including InsuU, Son & Co.. Inc. banking affiliates In connection with our Justifiable denunciations of such fl- nanclal schemes and methods we shall mention as fully as neces- sary the banking affiliates whose operations by the same set of officers. In control of the banks and of the affiliates, hahdled. con- trary to the interest of the public, the publics funds for specula- tion In definite stocks. Including In some cases the stock of the banks themselves, regardless of the Interest of the bank's stock- holders or depositors. The testimony of Charles E. Mitchell, as chairman of the board of the National City Bank, was a scandalous page In the history of positions of flnanclal trust. The testimony of Alfred H. Wlggin as to his relations with the Chase National Bank and its affiliate was equally shocking. Promotion schemes show In some cases a purely artificial set-up. the expenses or profits of which the Investing as well as the specu- lative public pay for. The testimony of Dillon. Read & Co., and others, for Instance, regarding the handling of foreign and general securities, showed such operations as these: Purchasing syndi- cates, distributive syndicates, trading accounts, and direct retail- ing to individuals, so that the purchaser under pressure of the market has paid profits on methods that have no relation at all to the Intrinsic value of the secxirltles he buys. THE VAN SWERINGENS For testimony along such lines the public should read of the Alleghany Corporation as fioated by the Van Sweringens through J. P. Morgan & Co.; the Pennroad Corporation as fioated through Kuhn, Loeb & Co. This method of piling up costs was particu- larly shown in the floating of foreign securities, which leads me to refer to the stupid, I might say, astounding testimony of Don- ald Durant. who represented Lee, Higglnson & Co. In marketing the Kreuger-Toll securities. He testified that he was the one American director and that he never attended a directors meet- ing in connection with that $50,000,000 fiotatlon. or at any time. One of the worst . dtects of stock-exchange activities was shown up In certain cases where the securities of corporations continued to be traded In by stockbrokers for purchasers after the corpora- tion Itself had gone Into a receivership or become bankrupt. This cautionary word is. however, necessary in advance of our final report: There are in the United States several hundred thousand legally chartered corporations — 403.173 submitted bal- ance sheeU for 1930 to the Treasury Department In connection with their Income-tax rettims. Their capital stock represented $106,184,000,000. Possibly not more than 3.000 of these corporations are listed In stock -exchange activities of the United States. The vast majority of them are represented by local Interests, where the Investor can see his proi>erty and knows personally the men or group of men responsible for administering that property. If I were for a mo- ment to Indicate that the reasons for Individual confidence in other Individuals have ceased to be Justified in the United States, I should be foretelling Nation-wide disaster and the end of our form of civilization built on mutual trust. These things are certainly Indicated, as related to the final report : 1 . There Is need for a method to make accessible to the invest- ing public everywhere frequent reports on corporate activities. Such a change cannot be brought about effectively except through Federal action; for corporations arc artificial beings created by States, and there Is no uniform law of incorporation or of con- trol in the 48 States and the District of Coiumoia. AN OVERSEAS EXAMPLE The British Companies Act deserves our earnest consideration as effecting corporate morality. In England every corporation is under the control of the Government from its inception to Its end. Hence our Securities Act cannot in every detail follow the British Companies Act. 2. Pitiless publicity should surround the operations of syndi- cates, pools, etc.. if such methods of affecting the market continue at all. The hearings showed no public value to any such s:rheme. The real Interest of the stock exchange is involved in this question. 3. Through the cooperation of all exchanges, buying on margin. If continued at all. should be continued under strict control, so as to prevent mere gambling and the massing of depositors' moneys from over the Nation in the form of brokers' loans. In September 1929 brokers' loans In New York were $8,500,.000: in November 1929 they were $4,000,000,000. 4. Corporations should be strictly held to the specific purposes for which they were created. 5. Directors should be compelled to direct; for they are quasi- trustees and represent the morality required of a trusteeship. As recommended by Mr. Aldrlch, officers of a bank should be required to disclose all their personal loans above a nominal amount to the board of the bank. Officers of the bank should be prohibited from participating, directly or Indirectly, through dummies or otherwise, in syndicates, trading accounts, and p>ools Officers should be compelled to disclose to their boards all their outside business and financial transactions. They should not be permitted to use the bank to favor outside Interests. No officer should be permitted to occupy the position of serving two masters. No man should be allowed to appeal to the public to buy secu- rities about which he Is unwilling to tell the truth. PRICES AND VALUES Assuming that this brief statement regarding the hearings be- fore the Senate Committee on Banking and Currency will be read by several hundred thousand people. It seems to me very appro- priate to Invite the sober-minded people of the United States to recognize the difference between prices and values. Our hearings — as the public is well aware— have shown that prices of securities other than bonds rose to a ridiculous height In 1929. In fact, so ridiculous was the speculative fever that stocks with no par value and with no dividends In sight or promised or de- clared went up to $150 or more. The shares of Insull Utility In- vestments, Inc., were Just such a type, reaching $149. and the testimony of H. L. Stuart, of Halsey, Stuart & Co., was that the public would have taken vastly more Insull securities than were offered because they believed In Samuel Insull and were hypnotized by his flnanclal empire. To carry the thought further, various constituent-operating utilities In the Insull set-up were then and still are earners of dividends, and hence have value. This Is true of every well- founded, well-managed corporation In supplying the needs of the consuming public. Therefore the prices reached In a bull market — a market constantly rising higher and higher — do not affect perma- nent values one way or the other, and hence sensible people of the United States must cease watching speculative stock prices every morning to know If America Is prosperous, or recovering, or what not. FALL IN STOCK VALTTES In Septembw 1929 the stocks listed on the New York Stock Ex- change had a quoted market price of $97,000,000,000. In May 1932 the same stocks had a quoted market price of $14,000,000,000. While the shrinkage of $83,000,000,000 represented losses to specu- lators that had appalling effects on public confidence, nevertheless the quoted price in May 1932 was no statement of genuine values. If the millions become familiar with the teachings Involved In our final report, the Influence of these hearings will extend for years and stop foolish people from slaving and tolling In order to save up for speculation. The same Influences of the press that have made the hearings familiar to the public will be counted upon by the committee when its report is submitted to the Sev- enty-third Congress. But ifi-liB%j[l1 Is said as to what might be done or should be done, tHf iwipnrtant fact remains — no rules, regulations, laws., restrictions, or whatnot can prevent a man from being a fool or a knave if he chooses to be a fool or a knavs. (From the New York World Telegram. Jan. 8, 1934 J The Whole Stobt President Roosevelt, in his message, paid high tribute to the banking and stock-market investigation of the Fletcher Senate committee by his blistering condemnation of the financial rack- etccTlng thus far disclosed. They call, the President declared, on the strong arm of the Government for their immediate suppression; they caU also on the country ^or an aroused public opinion. He asked for strin- gent preventive or regtdatory measures. The country has been aroused. So has Congress. They should be kept aroused until Congress has legislated wisely, effectively, and thoroughly. To accomplish these objectives the Fletcher committee should continue until the whole story is laid on the record. Much has been told. But much remains to be told. President Roosevelt's denunciation of reckless speculators was even stronger In his message to Congress than In his inauguration address when he stirred the country by his pledge to " drive the money changers from the temple." That is easy to understand. He and the country have learned many bitter facts since — how Albert H. Wiggin attempted to use the world's largest bank for JOO rONORFSSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 433 id M 432 CONGRESSIONAL cr their his own speculations; how Wlggln and o^-ber so-called giants the boom era • alternately puffed and deflated the market at tt wlU to reap fortunes at the expense of the unwary and uniniti- ated- how Clarence Dillon got control of mlUlons of other p*"**- ple's money by shoe-string investments; how a group of banks Detroit were mined by fancy promotion and thus set off the ea ploelon which rocked the Nation; how the House of Morgan extends Us financial control Into the lives of nearly every citizen Th:8 is not the whole story. Chairman Fletcher, who hi.« promised "to go the limit", Is prepared to get It all. The ve% eran legislator resisted successfully those who sought to stop inquiry a few months ago. He deserves the support of the cour try for his faithful public service and his determination complete the Job. ^^ «t _. The lamb in the 1929 crash wants to know how the New Stock Exchange operated In those high-flying days— and w The Senate committee next will address itself to this task. The Fletcher committee's Inquiry perhaps has shocked -more than honest bankers. As evidence of guilty consciences high financial circles, they have seen shake-ups in command the Nations big banking Institutions. These honest bankers wa*t the whole story, toe. for it affects their business. THE NEGRO AND THE N.R.A. — ADDRESS BY JAMES J. HOEY to Yoik thf note ;n )f >y 2- tie )e Mr. COPELAND. Mr. President. I ask unanimous consent to have printed in the Record a radio address delivered Hon. James J. Hoey. United States collector of internal rev nue at New York City, on Sunday. December 31. 1933, on subject of the Negro and the N.R.A. There being no objection, the address was ordered to printed in the Rbcord. as follows: It is indeed a privilege to participate In this Joint concerning the welfare of the Negro on the subject of Negro and the N.R.A." I feel particularly honored that I h^e been chosen as the first speaker to open the subject which I sure our listeners-ln will regard as a very Important natl( question. I say national, because the grave problems confroiit Ing the Negro are not so much racial as they are Interracial. T^' problem affecting the lives and destinies of 12.000.000 AmerK citizens. Is both national In Its scope and consequences a deserves the interest and cooperation of all Americans. May I at this time be permitted to say as a former member the State legislature and one who has been in close touch w State and city problems for many years, that I have acqui^d an Interest and knowledge of the many social. Industrial economic problems of the Negro. For more than 30 years I h^ve had an intimate acquaintance with the many colored citizens this part of the country and am familiar with the many undfer- takings launched In the Interest of the Negro. May I say, ir word, that I have both a sympathetic attitude and an understai d Ing Interest. .^ „ .., I realize that the Negro is confronted with a host of proble^ which concern and aiffect the progress and the future of the and vet It seems to me that the most serious and far-rer problVm, cne which demands an early solution. Is that of national opportunity and employment. The field for opportunity for the Negro who Is equipped with a higher and the opportunities for employment in the various trades industries are distressingly limited and restricted. While problem dates back to the time of the Emancipation tlon, it has become Infinitely more serious during our present economic depression. . Some months ago I made an Investigation of the unemploymi (nt problem among our Negro citizens In Harlem and was alarmed ♦" find that the unemployment of the Negroes In our own city is m thaji 60 percent. Incidentally. I am informed that In some cH ies It is as high as 90 percent. I have learned that wherever then a condition of unemployment the Ne-jTO Is the first to be fifed and as condltlon.s improve he Is the la.'^t to be rehired. I find this condition Is Nation-wide; that Negroes as a group are greatest sufferers In the depression and do not receive the ben of employment under the N K.A. In fact, the mtnimum-w provision of the NHJi. operated to the distinct disadvantage of Negro. For examplt?, where an employer had a Negro elevator at $10 a week, finding himself forced by law to pay a i wage of $15 weekly, he fVres the colored man and hires a w^lte man u, take his place. I realise that this condition could have been foreseen during th? enactment of the law. and the f£>ct remains that the National Industrial Recovery Act to the present time has been of no advantage to the Ne^o That is all the more reason why some other steps st^ould be to help the Negro. At the present time, the number of vocational and tlonal opportunities for the thoroughly qualified Negro Is limited that we find the Negro college graduates are forced •ccept employment In the most menial capacities, as port cleaners, and elevator operators, and yet tens of thousands our Negro youths are today attending colleges with high h< pes of the future but with little chance of being able to utilize tfielr education In their chosen field of endeavor. How many of my listeners realize the very high percentage Megroee, with one or more college degrees, to be found ar^ tlM porters carrying hand luggage in many of our large Bklnals? Hiese men are ambltlo\is and indtutrlous. and, of "" dlscussl sn The race, reaching oc,„ 1 am not advocating that the Negro group be restricted to the various trades and Industries. They are. they should, and they will continue to achieve high places In the arts and professions. But I insist that something Is wrong when we find that the greatest endeavor Is made to provide higher education for the more talented minority and at the same time comparatively little is being done to encourage and assist the great majority In secur- ing education and training In the trades. Industry, and agricul- ture Furthermore, almost no effort, commensurate with the great need, is made to augment and increase the number of occupations available to the Negro employees. Up to now no adequate appeal has been made urging the employers of America to employ a Just and fair proportion of Negroes, both in clerical positions and In the ranks of skilled and unskilled labor. It Is not necessary for one to pose as an authority on the question of the Negro In agriculture. In order to maintain that If there were more Negroes with proper and adequate agricultural training there would be fewer poverty-ridden Negro tenant- farmers and more successful farm owners, and a higher rate of wage for Negro farm hands In the rural sections of the country. Also, there would be less racial despair and more hope and con- tentment, as well as an improvement in the standards of living. Although this may be called good economics and sound sense, it Is essentially a question of opportunity and Justice. As has been well said by a leading .sociologist— •' Nothing Is so dangerous for a country as when a considerable number of men come up agalnsjt a wall of deepalr of their future progress. Next to that is the danger when any considerable num- ber of men get the Idea that there Is no opportunity. On the other hand, nothing makes a man work and strive like the open door of opporunlty. The chance or the hope of Improving one's conditions Is a tonic to anyone to work and serve. The Importance of the idea of opportunity in American citizenship must be obvious." I suggest that the various philanthropic groups, Institutions, and educational foundations, such as the Carnegie Foundation, the Rockefeller Foundation, and the Phelps-Stokes Fund, investigate this great problem. They should make a survey to determine all the facts and publish their findings and recommendations. There- after they should lead an extensive campaign of education among the employers and industrial leaders of America to the end that the neglected Negro majority may. In greater numbers, secure the essential opportunity of employment and livelihood and the chance of promotions and advancement, each in his own field of occupation. In conclusion let me say that such a program carried to a suc- ces.sful completion would prove the greatest single achievement In racial Justice for the Negroes in America since the Emancipation Proclamation of the Great Liberator, Abraham Lincoln. ESSENTIAL UNEMPLOYMENT LEGISLATION Mr. FRAZIER. Mr. President. I ask unanimous consent to have printed in the Record some speeches made at a con- ference on essential unemployment legislation, called by the Joint Committee on Unemployment and held in Washington, December 9. of last year. There being no objection, the speeches were ordered to be printed in the Record, as follows: I>aOCR.^M FOR NATIONAL ASSISTANCX (By H. L. Lurle. Director, Bureau of Jewish Social Research, New York City) The necessity for relief of the unemployed Is an acknowledg- ment of our failure to organize our economic life with Intelligence and to provide opportunities for productive effort on the part of the total laboring population. An acceptance of this basic fact Is fundamental to planning unemployment relief. Ha-stily con- ceived and executed emergency relief measures may be necessary as e-xpedlcnts to alleviate suffering and to avoid economic col- lapse. These plans should be judged, however, on the basis of the contribution which they make to an Intelligent and socially desirable organization of economic affairs and public welfare. To continue on the assumption that all meastu-es are of an emergency and temporary nature is exceedingly fatuous. We 1934 CONGRESSIONAL RECORD— SENATE 433 mtist grasp the realistic fact that we are engaged In a process of reorganization of public welfare as well as of economic affairs, and th.".t In the emergency relief measures we are laying the groundwork for our continuing social and welfare policies. It needs to be emphasized that the United States does not possess an adequate system of public welfare and relief. What we have Instead Is an antiquated and haphazard aggregation of poor-relief services which represent. In general, an unsatisfactory and socially Inadequate method of dealing with the problems of individual and family need. This traditional system of local poor relief presenting wide variations In the administrative practice and In standards of welfare has been modified In some sections of the country by more recent developments of special relief for depend- ent mothers, the aged, and other classes of dependents. There has also been In recent years some Improvement In administration of local relief, taut for the most part the basic character of poor relief remain."? unchanged. Destitute Individuals and their families who become the recipients of aid are treated as though they were primarily personal failures and Incompetents. Institutional care t3rplfled by the almshouse still remains the basic approach of public poor relief in too large an area in this country, although In recent years there has been considerable extension of the method of home relief in the larger urban centers. Infrequently is there an attempt to provide assistance which measures up to a decent standard of living. Relief in most instances follows the pernicious doctrine of " less eligibility " inherited from previous generations. This means that the relief authorities do not endeavor to provide for the needs of Individuals except upon the most minimum and niggardly basis of assistance which is Insufficient in many instances to provide even the bare essentials for physical survival. This in- adequacy Is as frequently a matter of social philosophy as of financial limitation. While some of the qualitative aspects of poor relief have been improved and humanized by the activities cf voluntary agencies, the effect upon poor relief in general has not been extensive. In discussing the national program of relief for the unemployed, we must not lose sight of the fact that the systems of relief upon Which it is being grafted are essentially haphazard and inadequate In character and based upon the outworn concepts of the Indi- vidual's responsibility for his own poverty, the theory of less eligibility and of unrestricted aid. It Is this system of poor relief which under pressure of the crisis assumed some degree of respon- Blbllity for the millions of destitute unemployed and their famil- ies as well as for an increased number of other classes of de- pendents who were forced to resort to such means for main- taining life. The preceding session of Congress authorized and the various administrative units established by President Roosevelt are de- veloping a program of unemployment relief which may be said to mark a constructive advance Iri the history of poor relief in the United States, The program began with grants of Federal money to States for their unemployment-relief activities. As compared with the loans or advances to States under the Reconstruction Finance Corporation, which had been the reluctant contribution of the previous administration to the problems of unemployment relief, the present measure constituted at least a realistic accept- ance of Government obligation to provide resources for relief purpos^s. Essentially, however, the new program of Federal aid was a bolstering by the National Government of the antiquated local poor-relief systems which had reached the breaking point In many localities owing to the unavailability or exhaustion of local and State funds. There was, however, the recognition that with- out discarding the century-old system of local responsibility the Federal Government had a real obligation to provide funds dur- ing a period of economic stringency. The reports of the Federal Emergency Relief Administration estimate that in March 1933 the peak load of relief was attained with a total of 4,660,000 families In the United States receiving tmemployment relief from public funds. Including single resi- dent Individuals and recipients of mothers' aid and old-age relief approximately 20,000,000 Individual persons, one sixth of the total population of the United States, were being assisted. Based upon report.*; to the United States Children's Bureau from a representa- tive number of cities, the average monthly relief per family In the industrial centers has been approximately $20 a month. There have been considerable variations In relief standards, and in many sections of the country families on relief this year have been receiving as little as from $6 to 110 a month for all fonns of relief. Social-work experience offers ample evidence that low relief costs mean inadequate food budgets, lack of provision for shelter, non- payment of rents, failure to provide clothing, medical supplies, fuel, and other essentials. Even if we were to assume that relief Is being given to many families who have some additional limited Income from other sources, it is doubtful whether the average ex- penditures of the 20,000,000 persons assisted In the United States In March 1933 can be estimated as having amounted to more than 40 percent of the previous expenditures of these families. We know too well that the standard of living which they are experi- encing Is similarly deficient. It Is to the credit of the Federal Emergency Relief Administra- tion that from its Inception it has helped to raise the level of relief standards through more generous appropriation, and that it has attempted to set forth minimum standards of relief, which in many States exceed the level previously attained In these locali- ties. The FJ;.R-A. has also been concerned with the problems of special classes of the unemployed, with the standards of relief administration, and has developed a program for the transient and homeless group. Through a slow and gradual process it Is conceivable that the Federal Emei^ency Relief Administration as originally planned might have succeeded In Improving the ma- chinery of local poor relief and of raising the standards of ade- quacy and of administration In unemployment relief programs. Although progress has been made In a number of States, It cannot be said that standards of relief for the country as a whole at this time approach the level of minimum adequacy. There is still a long way to go In reaching a decent standard of relief and method of relief administration In a majority of the States. It Is to the further credit of the administration, however, that It has not been satisfied with merely continuing the local relief programs based upon an antiquated theory of public assistance, including the makeshift programs of work relief. Within recent months more construction measures have been put Into operation which indicate a tendency for progressive action In dealing with the problems of unemployment relief. In the program of the Civilian Conservation Corps some progress was made In divorcing young members of families from the waste- ful syEtem of Idleness and dependency which poor relief encour- ages. Conceived as an emergency measure, it is becoming obvious that changes and extensions of the program need to be made if It Is to be continued Indefinitely as a measure of Federal employ- ment. The project is employing approximately 310.000 young men on a type of work which can be considered as preparing for future vocational opportunities for only a small fraction of the group. It Is Important, therefore, that the period of voluntary enlistment In the Civilian Conservation Corps be used for furthering educa- tional and vocational experience. An attempt should be made to integrate the program of the Civilian Conservation Corps with the projects for public works, with the aim of supplying vocational experience leading to employment in skilled construction trades and to Industrial opportunities. Diversified trade and occupa- tional training would similarly be helpful for selected groups. Another development in Federal relief has been the organization of the Surplus Relief Corporation for the distribution of surplus agricultural products to the vmemployed and other dependent groups. This program may be said to be a crude but nevertheless a realistic attempt to resolve the paradox of destitution in the^ midst of plenty. Whatever may be said for the project from the point of view of economics, for example, that it is an attempt to create an Illusion whereby a part of what has been produced by agriculture Is supposed to be absorbed or to disappear, thus leading to the enrichment of the producers, this attempt to dis- tribute surplus products among the unemployed is admittedly a more intelligent and socialized procedure than the expedients of plowing under, burning, dumping, and other methods of destruc- tion which have been resorted to. One disadvantage of the sur- plus-relief plan, from the point of view of unemployment- relief programs. Is that In some parts of the country, where cash relief has been the method of assistance, a less desirable method of relief distribution Is being introduced. Instead of treating the unem- ployed as normal purchasers and consumers entitled to some lati- tude and personal Judgment In the use of relief funds, the food- distribution plan makes them more definitely wards of the State, which determines their consumption habits. Where the commis- sary method of distribution of relief Is already In existence, no radical change in method is introduced by the surplus-relief plan. Aside from disadvantages as a method of relief distribution, It must be acknowledged that the additional items of pork, peanut butter, dried fruit, etc., add to the limited dietary and Inadequate food allowances of relief recipients. Social workers regard with enthusiasm the program of the Civil Works Administration, which is now progressing rapidly. In this project we have a more modem and satisfactory plan of dealing with the minions of normal workers who have been made Jobless by the depression. The Civil Works Administration U attempting to transfer 2,000.000 of unemployed from the status of relief clients receiving a meager dole, directly or on the basis of " made work ". to the status of Independent workers for whom the Nation Is establishing normal and productive work on public projects. In addition, an equal number of work opportunities are being made available to unemployed persons not on relief, which means work opportunities for the Jobless who have not yet reached the point of destitution, which makes them eligible for charitable assist- ance. Through civil works the test of destitution as the basis of eligibility for unemployment assistance has been eliminated, a rate of wages approximating the normal wage rate for skilled and semiskilled effort has been establUhed. and the unemployed whom It serves are freed from the restralnto of supervision and tutelage. Thus at one step the Federal Government is vlrttially repealing the theory of poor relief with Its pernicious doctrine of destitution and of less eligibility of the indigent. No longer is the unem- ployed man or woman looked upon as an instance of personal maladjustment, but as a Jobless worker for whom the Nation has accepted an obligation to provide an opportunity resembling normal and remunerative employment. The plan of the Civil Works Administration has been announced as a temporary measure. We urge this Conference on Unemploy- ment Legislation to Insist upon the plan of Civil Works Admin- istration being continued as a permanent measure of unem- ployment relief so long as private industry and public works combined are unable to absorb the entire potential labor power of the Nation. It has been estimated that the funds that have been made available will be exhausted by March 1. It Is Inconceivable that the entire surplus labor of the Nation, which may be estt- Lxxvrn- -28 A^l CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 435 LXXVUl- 431 CONGRESSIONAL RECORD— SENATE persou hlch nd jnt mated at thU time m between 8.000,000 and 11.000.000 Will have been normally absorbed by tbe various developments the recovery program within the next year. It Is difficult to mate the cost of continuing the civil-works program, but there la a rapid reduction In the ranks of the Jobless, at $200 00«3.000 a month might be required for the year 1934 Whatever may be said in criticism of the Civil Works t tration. of shortcomings in the effectiveness and utility of projects or of Iniidequacles in methods of selection and adtn tratiun. the plan itself Is e8fi?ntlaily desirable and progressive Ions; as riore radical measures of economic organization are placed in efTc«t. The defects of the civil-works plan, largely to the rapidity with which it has been placed in operation, can eliminated in time and improvements made in the nature of pTojects. their social utility and efliciency. and in the methods administration. The civil-works plan should be permar retained as an auxiliary method of unemployment relief. It not interfere with a desirable development and enlargement the public-works program. Although of outstanding importance, the Civil Works tration is concerned with only a part of the relief and social fare needs related to poverty and unemployment in which responsibility and the participation of the Federal Govemi arc required. The demoralizing effect of the depression Itself tended to Increase the number of unemployable and partially ploy able for whom continued relief measures and programs for treatment are essential. The present load of public-relief agencies, depending In many localities largely or tirely upon Federal funds, contains many aged and supera Individuals, heads of families incapacitated by illness and disease, and broken families due to death, desertion, and Ization of wage earners, dependent children, and others for there la needed a program of public assistance more d« than those now available under various forms of poor relief. Impossible to draw a sharp dividing line between those in because of unemployment and thoee suffering from other tlons leading to economic insecturlty. The custoniary programs of relief and social service which with the various classes of dependents and other social needs the community have been greatly attenuated and in some ttances have broken down. It has been generally that private philanthropy was Inadequate for organizing a gram of relief for unemployment; It is similarly Inadequate deal with the large problems of poverty and dependency wt are the casualties of our economic life. To some extent the a Ity of States and municipalities to provide for various depe groups and to continue satisfactory public- welfare programs education, hospital care, health and recreation has been affe by the dwindling of local and State resources intensified by fact that under Federal policy and stimulation local and " resources are being diverted to the emergency program for ployment relief. The Federal Govenunent has demonstrated of all goveriunental agencies It alone has the power to reg •conomic affairs and the authority to divert national Income •oclal-welfare purposes. It is desirable, therefore, that the elple of Federal responaibUlty be extended to assure to every lly and every individual a minimum of economic security. •pective of the ability of the 'abor market to absorb him or own ability to become an effective participant in production. It is important also that we recognize that an adeqtiate gram of unemployment relief should seek to repair the ravi to social institutions and public welfare which the depre has caused. We shotild not for a moment overlook the fact we have reached an economy of surplus and that adequate sources are available In this covmtry for a hlgb standard social well-being. We shoxild, therefore, not be content preiienting a minimum program of relief assistance but urge a maximum program of social reconstruction, restoring the country the standards of living and culture which we previously attained. For this reason the effect upon our tlunal institutions should be Included in those matters of cern to the national recovery program. The Federal Biust accept the responsibility of restoring and maintaining educational system. Included in educational problems then the particular problem of provision for higher ediicatlon ticularly for the youth above the age of 16. endowed with for Intellectual achievement. It is making poor use of our resources to consign gifted youth to the status of Jobless, skilled labor, and bllnd-idley occupations. The Federal Gov ment should be urged to subsidize State universities by educational scholarsliips for tuition and maintenance of youth whose Intellectual capacity makes them potential assets high order to the welfare of the Nation. Buch a program supplement the Civilian Conservation Corps and be available thoite who qualify on the basis of merit and preparation. To achieve these objectives there should be developed a gram of national assistance as the keystone for State and program of public welfare. Pending the establishment of quate pension and insurance plans the Federal Government subsidise and set standards for the adequate relief of classes of dependents, including widows, dependent children, and Incapacitated. Relief funds of the Federal Emergency Administration shotild be made available to the various for tbese purposes. The Federal relief plan should seek. In cooperation with and municipalities, to provide suSclent funds to assure standards of living for all classes of dependents, including quat« proTlslons for health and medical care, and should alC of edti- unl^ss leist Admlc Is- 1he adtnloju- so ^ot que be the of permaneiAly nfed of Admliils- viel- Ihe Govemm( nt lias em- construct Ive he rn- iperannua «d chro nic hosplt al- whsm desirs ble II is niied conili- ci>al of in- acknowledi ^ pjro- to ch hU- mt for ffected ^e State unces our great cities. There, in order to erect a building, one must pay as much, or more, for the land as the cost of the bufldlng. This payment, viewed from the social standpoint, Is not for the service of any individual. It is merely a levy subtracted from the income of society for the benefit of the holder of a piece of paper qftiled a deed. As society progresses land values rise and absorb an ever- increasing share of the product. The holders of the land are col- lecting income on $150,000,000,000 of value while they are not rendering as landlords one iota of service to our society. If all land rents were tomorrow absorbed by taxes, there would be no less product. The landlord alone would suffer. This to clearly another finding in our classification of incomes as divided between earnings, findings, and stealings. Perhaps this point should be pressed a little further. As one looks about him with a common-sense attitude, land titles seem like any other titles. BXany have been acquired in good faith. They are part of our property system. But viewed in a broader light, they are the result of a mistaken social policy by which the Government permitted city land sites, coal mines, oil fields, in fact the bulk of all owr natural resources, to slip into the bands of private owners, who now take a tax from the rest c» us out of the production of society. Had the Government elected the wiser course of leasing these lands at an advancing rent, we would today t« 436 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 437 ^ and not for service. It consists of erecting highly specialized corporations for the purpose of getting the maximum ret\iin while rendering a minimum in serviceable goods. If, as englneeis suggest, oiir business structure is competent at this moment 1o produce triple the volume of goods that are Rowing from o\ir factories and falls to produce these, wc may conclude that tt e public is. by the failure of the business system, being robbed (if two thirds of its lndu£trlal Income. One outstanding American economist. Thorstein Veblem. has suggested that the buslneiis system is one of organized sabotage of the industrialists agalmt the consumers. This view, though ridiculed at the time of is appearance, seems today cloae to the truth. Certainly we hai e for 4 years been witnessing the shrinkage of our national incoa e because of the failure of capitalism. The owners of America in the mad speculation period of tlie 1020'8 piled up bond and mortgage debts which now total X 7 billions — a sum approximately equal to the present nation il wealth. On top of this are stock issues and deeds to proper y •n which they hope to command an Income. The result is thut the total of Interest and dividend payments has. according ' o the conservative Journal of Commerce, during the entire deprei i- slon continued at levels almost double thoee of 1935. (Last yei.r the country paid $7 .000.000,000 for corporate Interest and dlv - dends as against H.000.000.000 In 1926. at a time when 15.000.0<0 people were Jobless. This year the situation remains almost i ^ bad.) Looked at In the large, otir capitalistic system Is one in which those who engage in productive activity secure meager rewar( is while thoae who deal In little sheets «yt paper called stocks, bond i, and mortgages take a heavy toll In findings and stealings fro n the product. The new deal of Roosevelt seems essentially aimed toward the preservation of these property incomes rather than ' toward the alteration of this system. The significance of the situation as regards taxation seems clear. Taxation should today be levied not upon the piirchases of tie mas:«s of small consumers, as is now being done, but should le used as a method of absorbing the findings and the stealings of those who have to date been our industrial overlords. This ml y appear to be a policy of confiscation. In a sense it Is. but It Is confiscation of incomes which never were earned, of titles which never were clear. It is a taking by the people of property which should never have been allowed to enter private hands. Seven U practical proposals appear for State and Federal taxation. First. We should have an Inheritance tax which, exempting small Inheritance, would completely annihilate all the great dynastliis which today run America. This tax should be supplemented wlih appropriate gift taxes to prevent evasion. Second. We should tackle the land problem and absorb the lard values of the absentee holders who today receive such a share <»f the annual Income without rendering service. Third. We should place high taxes on the excess profits of o\!r monopolistic combines, which have been fostered by the N.R.A. The N11.A. is in its essence a legalization ot monopolistic priread a day, and 2 pounds of butter, 2 dozen eggs, 10 pounds of potatoes. 6 pounds of stigSLr. and 2 pounds of sirloin steak a week, would pay #100.79 more already bring In 20 percent oT Federal. Stete. and local revenue i. ) enterprise. Individual initiative, and rugged individualism which ini luXiCTCBii in ana aevubiuu mj hue wcixiuc «i^u oaicb/ ui wuc u^ uuvv^ masses of America. and a pounds of sirloin steak a week, would pay $100.79 more 'I 438 CONGRESSIONAL than at the August 18. 1983 price level: and those prices were Uo high for the unskilled employed. The 1926 price level means an average Increase In the cost oi living over present prices of about 30 percent. Consumers have always paid for farm products enough to affoi d farmers a fair return on legitimate costs. The farmer has usiial y gotten about 40 cents of the consumers' dollar. In 1932 consume rs paid for meat products •1,656.000.000. and producers recelv(d ♦721.000.000. so the spread was $935,000,000. A Government marketing corporation empowered to buy farn products, procew them, and sell them to the ultimate consume r. should reduce the spread at least one half. Congress should crea « such a corporation. TBB MXCaO AHD X7WC1CPLOTMSMT By Charles Edward Russell The situation of the colored worker of this country in respect to unemployment and destitution may be best Illuminated by refer- ence to a few statistics Here in the city of Washington. Capital of the Nation, the nuti- ber of persons receiving public relief on October 31. 1933. wis 14.188. of whom 10.606 were Negroes. The Negro population of t le city is 27 percent of the white The proportion of Negroes receir- fng relief Is 75 percent. In Cook County, m.. which means vir- tually the city of Chicago, the Negro population Is 6 percent of the total; the Ne^rrces receiving relief are more than 20 perce it of the toUl. In Philadelphia the Negroes form 11 percent of t le total population and 36 percent of the total number receivtig relief. In Baltimore the Negro population is 17 percent of tie total and 44 percent of the family relief work carried on by prlvs te agencies is for Negroes Last year of 12.000.000 unemployed wort- ers in America. 1.500.000 were Negroes. For a reason I shall revert to later, the disproportion has since much Increased. In the larger industrial centers today. Negroes form 40 to SO percent of the unemployed. In Birmingham, Ala., they form 75 percent. In St. Louis 8 percent of the Negro workers are ui- employed or partly employed — 5 percent without any work. 3 percent on part time. It Is a sinister fact and a disquieting fact that upon tils submerged 10 percent of our population the measures for national relief, certain measures of relief that have been of undoubted and often great benefit to the generality of workers, have only augumented the misery of the colored. The codes of the N.R.A. have shortened hours for the white workers, sometimes increased their pay, and sometimes diminished unemployment. They hace too often worked among the colored population to deprive evin those at work of their jobs. To understand this we must remember that the average pay of colored workers has always been lower, distinctly lower, than that of vhite workers doing the same class of work. In many instances It has been recognized and even standardized at 50 percent low x. On these terms white employers, particularly in the part of t le country where after 70 years the Civil War Is still raging, were willing to employ colored persons. When the Nit.A. codes a >• peared with their minimum wage limits this economic advanta ;e disappeared for the white employers. Confronted with the nea s- aity of raising wages In all the lower grades of employment le Instantly ard almost universally decided that at the same wa le levels he would prefer to employ white labor and dismissed lis colored employees even though they might have been years lu his service. This has resulted in a huge Increase of unemployment in tie southern States, and a corresponding increase in the crimir a! difficulties. A survey of the situation made under the direction of Mr. John B. Davis, of the Joint Committee on nnemploymeut, disclosed that this movement to dismiss colored employees and substitute whites was by no means confined to the South nor to Industrial employments. It extended also to the North and In- cluded there employment as domestic servants. One typical cate. an example of thousands, may l>e cited as an illustration. A negro truck driver had been employed for many years at $5.50 a week. When the code went into effect his wage must be raised to $12.50. He was discharged and a white man put .In his pl»;e. Where Negroes are still employed In the South, they are oftm employed at wages that violate the codes Of this many Instances were found, one of them being the case of an employer that hliKl Negroes at less than code rates and still sat on the board form id to enforce the code — a typical Instance of the psychology of t le southern employer. But I do not know that it is fair to say this as if the South were the only offender. In Kansas City. Mo., for instance, SO percent of the colored domestic workers have been displaced, a: id in Philadelphia this movement has gone on to a point whire displaced colored workers are offering their services at 74 cer ts a day. In Greensboro. N.C.. however, they are working for |1 • week, with room and t>oard. and In many ether places In t le Qotith for $4 a week and find their own rooms. At Norfolk. Vt.. women are working for M a week, that must pay from It $1 25 a week for street-car or bus fare. In one southern community the board of trade has been active ly at work coercing employers to discharge colored workers aid replace them with white. In another the League of Women Votirs acnt about the city organized bands of Boy Soouta to seek out opportunitlea for work upon the understanding that only wh te workers were to be employed. In Gary. tod.. 5 Negroes have been discharged for every 3 wh te workers that have suffered the same fate. When there w( re RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 439 signs of an Indtistrlal improvement and men were being rehired. 5 white men were hired for every 3 Negroes. In 12 large cities, of 12,616 persons registered as unemployed, 75 percent were colored: of domestic workers. 78 of the unemployed were colored. Public bodies sometimes do not hesitate to openly avow their porpoee to discriminate against the Negro. The Railroad Com- mission of South Carolina has made a rule that no pullman car shall be operated In the State unless it Is In charge of a white man. The most effective method of getting rid of colored labor has been developed in what may be called the Mississippi plan, and consisted of shooting colored workers on the railroads or beating them with clubs until disabled On one dlvL-sion of one railroad In Mississippi in a few months 7 colored workers were shot to death while performing their duties, and more than 20 were disabled. The conclusion from all this is obvious, sinister, and certain. We have created here in America a helot class. When depression comes we grind still lower those that in times of what is called " prosperity " bore always a load of our contempt, injustice, and oppression. We have implacably pursued with our vengeance those of oiir fellow creatures that have been guilty of the crime of a dark complexion. They being the helpless and defenseless perpetrators of this offense against our unwritten laws of tinting. when a time comes in which we must pay to these pariahs the wages we must pay to others, we prefer to have them as wretched dependents upon charity than to allow them a chance to earn their own living upon the same economic basis as white persons earn theirs. It is an oppression perfectly safe. No one will effectively champion the cause of the pariah and do him right. But even those of us that believe In the jjenalty for pigment must profitably remember that, if all tales are true, there is In the universe another system of justice than ours, and the requital of that Thomas Jefferson foresaw for the unutterable sin of slavery may not overlook the sin of racial hatred and racial persecution. LIMrrATION OF THE HOXTKS OT 1.ABOK (By Charles W. Erwln. Amalgamated Clothing Workers of America) The 130.000 workers joined together In the Amalgamated Cloth- i Ing Workers of America favor the limitation of the hours of labor I primarily because it Is the first attempt to meet the evils of j unemployment and low wages while employed. I Bitter experience has taught us that the evils of unemployment I and low wages can be efficiently attacked only through govern- mental action. Those employers who have enough social vision to perceive that the maintaining of decent standards of wages and conditions In their factories makes for the good of the entire community as well as for themselves are not sulBciently large in niunber to be able to bring about conditions in Industry which will at least approximate those that should rule In any truly civilized nation. No matter how strong the urge of these employers might be to achieve a higher Industrial civilization, they are subject to the competition of other employers in their particular Industry whose only iirge is immediate profits, irrespective of what damage to the social body might be done through the maintenance of a low standard of wages. E.xponence has proven that it is useless merely to appeal to the sense of Justice of those who are in con- trol of the means of production and distribution. It Is vitally Important therefore to throw the whole power of government be- hind both those employed in industry and the minority of em- ployers who are at least intelligently selfish enough to know that they cannot continue to prosper unless a higher standard than now exists is maintained by the workers as a whole. We have heard much talk about the 40-hour work week, and the blanket code, under which industry was supposed to run until the various particular codes were adopted, called for this basis as a work week. It does not require any guessing to know that a 40-hour week in the vast majority of cases will not put back a sufficient number of people on their jobs to bring about the Increased purchasing power that President Roosevelt has been striving for through the N.R.A. The general presidpnt of the Amalgamated Clothing Workers of America, Sidney Hlllman. who is also a member of the Labor Advisory Board of the N.R A., in his address at the clothing code hearing, submitted figures which proved beyond hope of successful contradiction, that the numl>er of workers who would be put back on the basis of the 40-hour work week would be negligible. Know- ing the Impossibility, however, of securing the 30-hour week, a compromise had to be made which called for a 36-hour week. Events since have proved that a 30-hour basis will doubtless have to be adopted if the standard of the clothing workers is to be retiu-ned to where it was t>efo-e the deflation of 1920. Together with the limitations of the hours of labor must go Increases ia wages If the entire N.R A. program Is not to result merely in the spreading of work at poverty wages In place of the giving of work to all in the industries at wages which will enable them to maintain within the present economic system at least a standard of life which approximates what oiu- social experts are pleased to call " decent standards." TAXATION or INCOMES AND C0R1>0«ATI0N 8U«PLUSES (By Dr. John H. Gray, former president the American Economic Association) We are truly In a new era — the power era with its automatic machinery. We have the wealth, we have the raw material, we have the equipment and workers, and we have the technical skill to produce and distribute an abundance of material things for all our population. Furthermore, we have the cash and the credit machinery to start the industrial machine. All we lack Is sense. There Is but one difficulty — that is that the wealth Is too much concentrated in both ownership and control, while the cash and credit is much more concentrated. The banlES In the Reserve System, if there were a demand for it and they were not afruM. could expand bank credit safely by $8,500,000,000 to $10,000,000,000. If they saw a chance to make a profit by it. But there Is no chnnce to make a profit In the present deadlock and lack of confidence. How long are we going to allow the fetish of profits and prop- erty rights to prevent feeding the hungry and putting the unem- ployed to work? You cannot start the industrial machine by an increase of commodity prices, by creating more debts, or even by destroying the disequilibrium between the prices of factory-made goods and farm products, nor by Qoodlng the country with paper money, nor by devaluing the gold dollar. At least either or both of the last-named remedies, if they did start the industrial machine, would surely result in a wild specu- lation in both securities and commodities, in an increase of land values, and an increase of debts that would soon bring us to a collapse more disastrous than the one we are now in. Nor is the construction of Federal public works by money from bond Issues likely to go fast enough, or far enough, to have significant effect before the national credit is shaken to be of much benefit. The construction of public works. State or Federal, or both. Is too small and too slow to meet tlic present emergency. For notwithstanding all the Federal appropriations and all the bally- hoo, the total amount of public works is much smaller than 2 years ago, and we are In the fifth year of distress. Some Increase In Federal public works has been more than offset by a virtual cessation of State and local public works, except such as are now carried on by Federal funds. F. M. Woodlock, in the Wall Street Journal of November 28. 1933. says there can be no revival of business until the business men who now control the concentrated liquid capital see their way to make a profit by putting It into circulation. I agree with him that there can be no revival until this liquid capital is put into circulation, but there is no way to put it into circulation until It is taken away from the men who now control it and turned directly into purchasing power in the hands of the masses of the people. Of course, if it were so used. It would ultimately redound to the benefit of those who now own or control It. for It Is not earning them anything worth mentioning. Witness the fact that all ths national baniu together last year operated at a total deficit of $140,000,000. The current year is much worse for them than the last. There can be no cocial Ju.stlce. no prosperity, no prevention of starvation until we are producing more than we are at present, nor until our foreign trade is in a measure restored. Those now living can never hope to see it restored to the plane of 5 years ago. The latest publication of the League of Nations at hand (Sur- vey of Economic Conditions, 1932-33) states that foreign trade of all Eu"opean countries the last quarter of 1932 was less than 40 percent of that of 1929, and that the foreign trade of the rest of the world fell off more than 70 percent, and that wages and sal- aries in the United States fell from $53,300,000,000 in 1929 to $28,200,000,000 in 1932. a loss of $25,100,000,000, or 53.1 percent. Under any decent arrangement and distribution of property, most of th'.s $25,100,000,000 would have been spent for consumable gocds, not for investment. With purchasing power so curtailed by unemplojrmcnt. what is the use of talking about business revival or prosperity or the bal- ancing of the Budget? They are literally impossible. By the same authority " tliere are now 41.500.000 workers cov- ered by unemployment Insurance "; but with so large a part of the total popiilation actually unemployed, all these systems have departed from an actuarial basis. They are all living to a very eerious degree off accumulated saving and for the most part by placing additional debts on a world already in debt to a much greater degree than can ever be paid, even if the people were at work, much less when so large a portion of the working people are idle and living on doles. What is the sense in talking about raising prices of commodi- ties, or worse, of destroying the disequilibrium between different classes of commodities, when so large a part of the population have no purchasing power whatever at any price, and when all the purchasing power, particularly In the United States, Is In the hands of so few people who do not need to purchase for con- sumption, and because of this or their fear are purchasing much less than usual, and are howling about overproduction and taxes. It Is, in fact, overproduction only in a sense that purchasing power has been withdrawn from the great masses who need and want the goods to such a degree that the goods cannot be sold at a profit for those who have the legal title to them. It is not overproduction but lack of purchasing power In the hands of the masses from which we suffer. It is well known that the great surplus that cannot be sold at a profit today con- sists primarily of raw materials and foodstuffs. Do we have overproduction of foodstuffs in any rational sense with tens of millions of jjeople starving, here and abroad? The publication of the League of Nations referred to estimates the world production of foodstuffs in 1932 at aliout the same as 1929 (there has been a great decline in the amount of manufactured goods); yet. if the trend of Increase of production from 1925 to 1929 had continued to 1932, the production of 1929 would have I been much greater than it was. yet would have fallen far short of I the needs of the world as shown by the growth of population. The report says that, with the exception of some tropicai prod- ucts, there is not enough of food products. The allegea sur- pluses after 1920-21 would have rapidly disappeared lad pur- chasing power been properly distributed. If the trend of Increase of production from 1860 to 1013 had continued until 1933, the production would have been twice what It was in 1932. We are not suffering from overprottuctlon. but from an Insane. Irrational, and Impossible concentration of wealth which deprives a very large part of the population of any purchasing power whatever. This has stoppsd the industrial machine, thrown mil- lions out of employment, and made paupers of them. The situation has been rreatly intensified by Insane natlonal- ! ism. In 16 months, beginuiiig in September 1931. 23 naUons had i general increases in tariffs, 50 countries Increased their tariffs, 52 countries imposed import quotas, license systems, prohibitions, etc., and 12 established import monop>olies. largely on grains. France. Great Britain, Australia. Germany. Italy. New Zealand, and Czechoslovakia have greatly reduced their debt charges by refunding at lower interest rates. On the other hand, we are adding daily to our debt charges by piling up additional debts In the attempt to start Industry on the basis of profits. Our discredited business " leaders " are trjrlng to hold Uie social revolt until the depression cures Itself, which means until the debts are liquidated by bankruptcies as has been the case In earlier depressions. They do not realize that the circumstances which made such a procedure possible In the past have entirely disappeared, and that If such a procedure were prolonged long enough, it would mean literally universal bankruptcy and total collapse. Prices will not rise till purchasing power Is put Into the hands of the masses. That purchasing power Is now in the control of a handful of men in New York who are bound by tra- ditions of profit that will not let it go into the hands of the people voluntarily. Furthermore. In earlier depressions circumstances were such that when debts were paid, the debt burden was lightened. But with the fix we are In today, the more debt Is paid the heavier the debt burden becomes. This is due to the effect of falling prices. Irving Fisher 8a3rs that by March 1933. 20 percent of debt existing In 1929 had been liquidated (largely by bankruptcies and foreclosxires. It is true), but that due to the fall of prices the debt remaining had increased the total debt burden by 40 percent (Economea, Oct. 1933. vol. 1. p. 346). President Roosevelt's efforts are to be highly recommended. He, at least. Is doing something to feed the people and to put some of them to work on useless and Ill-planned work for the most part, but they have little or no effect In starting permanently the industrial machine by putting purchasing power In the hands of the masses. His efforts are chiefly valuable because they compel the American people to think about social and economic matters for the first time In generations. This is fundamentally neces- sary before any administration can make serious headway, for no administration can go much faster, or much farther than public opinion will support It. Therefore, the President's edu- cational program is probably worth much more than it is costing. The so-called " business leaders " have been thoroughly dis- credited, but not the system which made them and led us to disaster. That system can never be made to work again, even to the satisfaction of those who were dominant till the collapse of 1929. This crisis calls for purchasing power In the hands of the people — not for the artificial raising of prices, however low the prices or however great the disequilibrium between prices of different groups of commodities. But two posstt>le and available sources of funds are In sight — the concentrated liquid capital now centered In New York, or even Increasing Government loans. The loans If possible would put an Intolerable burden of debt on the consvimers of the future. If the loans could be floated In sufficient quantity and the proceeds distributed speedily enough in sufficient quantity in cash to the unemployed or by Government expenditures on a sufficient scale. It wovild Increase the purchasing power. Increase prices, start the industrial ma- chine and enable us to collect taxes enough to balance the Budget. But God forbid that we should have a revival of business unless we take measures to prevent such a collapse as we are now In. If present attempts could be successful, the money would have to come from the liquid capital now in New York, but the present owners of It would have a claim on future industry for Its repayment. But the Government credit has limitations, and may easily reach a breaking point, if pressed much further. The at- tempt this week at refunding illustrates that the breaking point is not far off. But present methods are altogether too slow and Indirect Apart from the slow and cumbersome public-works program, the Government has already poured billions of dollars Into private companies. In the attempt to start business, which can be started, as said so often, only by purchasing power in the hands of the public. But the advances made to banks. Insurance companies, and other financial institutions are virtually lodged In the banks and have had no appreciable effect on business or in Increasing purchasing power for consumable commodities. That advanced to mortgage companies and home owners has largely gone the same way by more Indirect routes, for It has largely been used to pay debts and has then been boarded or put into the banks by the mortgagees. We should have been out d Incidentally that all the States are Ucd hand and foot by const 1 tutional limitations: hence the almost universal State banc ruptcy.) No nation can exist permanently with as many exces- sively rich men as we now have, or with as large Individual fcr tunes as at present. These fortune* must now be dissipated r more progreastve taxation. Income and inheritance taxes than ha re yet beeib proposed. It may be Inexpedient to set a definite Unit to the amount of money one may acquire, but to save civilisation it is r>ow necessary to limit by law the amount he is permitted bequeath by will, and to take by progressive Uxatlon all above fixed maximum for public purposes. Huey Long's particular figures on this subject are open doubt, but the principle Is sound. The Puritan doctrine of thrift and saving has no application In the age of power and plenty That is particularly true of our present condition of unequal trlbution. and large fortunes. Roger Babson said in a public address November 29. 1933, that 3 percent of the population furnishes the bulk of capital for new enterprises, dtirlng dominance of the profit motive. The whole emphasis was plae^ on loaning and investment. The result was an overinvestment which destroyed profits, and a profitless prosperity, overproduc- tion, collapse, unemployment, disaster, bread lines, and paupertsfa This great Inequality of wealth with an undue proportion of annual product going to a few people gave them Incomes they could not spend by the wildest extravagance and luxury. system lasted only so long as vast foreign territory, peoples, materials could be profitably exploited. That has all but dlfsb- peared. Other nations are resolved to develop their own resourc 's, The insane nationalism following the war, with Its self-deterii 1 nation and national self-sufficiency, has made foreign Investments unsafe for years to come. Under these circumstances, we And selves greatly overinvested for any market, at home or abroad profitable prices. Foreign markets, as already indicated almost disappeared. They have disappeared never to return the present scale during our lifetime. E>\iring the last three Presidential administrations all •mphaals was thrown on profits and investments and forcing elgn markets. (See A. W. Mellon 's book on taxation.) With foreign market almost gone for both foreign goods and investmelit we are not only overinvested for the domestic market in depns- alon times, but if every American coxild be put to work at prodtc tlve labor, a thing utterly impossible with advancing technology and Its consequent unemployment, the overinvestment, with lack of profits and unemployment, must remain for years to Stuart Chase, in the December 1933 Graphic Survey, says that the statement of the textile manxifacturers themselves, their equi^ ment Is double that needed, and cites the United States Comm aloner of Labor as saying In 1937 boom times that 19.5 percent the capacity could meet the demand. We do not need at present Investment, nor saving, but purch4B Ing power in the hands of the public to carry off at a long as the profit system remains — the goods that our •quipment can produce. The only source of that purchas power is the large cash surplus of the large corporations, now being paid out rapidly in dividends mostly to well-to-do and people. These people, under the present uncertainty and lodge the money in the banks or hoard It. <>ie corporation is now paying unearned dividends at the rate •130.000.000 a year. What we need now Is a direct levy on the fast disappearing cash surpluses of large corporations. If that shoiild prove i sufficient to relieve the situation, and start Industry, then general direct levy. We need not use the phrase " a capltlal levy ", for that phrase has come to make an Insane emotloc al reaction similar to that evoked by the words " sodallam ", " coi a- m\inism ", azxl even " red " and " anarchy." The Ignorant populs ee do not know that such levies have been the main source of pub- lic tncoaoe in the United States from the very beginning. 1 or the general property tax on which the States and the loca 1- tles have always matiUy depended is a capital levy and nothiig •lac. Tba trouble with it has been the graft and evasion aid Inadequate ezamptlons. not in the theory of It. Under present drcumsUncea these ought to be liberal exemptkma. A national direct levy at any Ume with total exemptions at ■ay •1004MI0 or more could easily be coUectad. It could be lil the more aaaUy collected, with the present large caah surpluais, for It mast nevsr be forgotten that theee surjHuses ware accum i- lated bf ipsenlaUve means, largely with other people's ■woey — bank depoatta. They have been used for speculative purpoa*. lliey not onljr aiade and prolong ed the ils|ifiieihwi ateoMl biit to a tie thst Tie and ovr- at have (in tie fir- tie ts cone. ?- s- of profit — BO present iig Ust ri:h feu:. of January 11 famished a large part of the call loans for the orgy of speculation, on the New York Stock Exchange from 1937 to 1939. when this money drove the average rate of Interest on call loans for a year to 12 percent and often put the rate up to 30 percent. These 6peculat<»-a made It Impossible for business men In Europe to obtain loans at any tolerable rate and were the Imme- diate means of throwing the whole world off the gold standard. There was more than $4,500,000,000 of nonbank money, popularly " bootl^ " money, on call in New York at the crash. This money so far as not paid out in unearned dividends Is today the greatest menace to world prosperity, for It Is in control of a handful of profit-seeking men whose god Is profit, and it Is lying idle. Only a small part of It can be put to work In bank acceptances, and Government short-time securities, and call loans. Most of these have broiight for a long time past much less than 1 percent. That amount of cash cannot be there without leading to dangerous and injurious speculation and manipulation of the markets. To ease the situation, we must not only redistribute existing wealth, but we must provide that a much larger portion of the annual product goes into the hands of people who will not Invest It directly or indirectly but who will spend it for services or con- sumable commodities, and thus make a market for the goods turned out by our great equipment. By far the largest portion of Government expenditure goes either for services or for construc- tion for nonproduclng purposes. If capitalism based on profit seeking Is to endure, property as at present held must be redistributed by Government action. That is taxation. Industry must be so reorganized as to permit a much larger proportion of the annual product to go to wages. Wage earners must be given such security for old age and de- l>endents as will permit them to spend on consumption more, and a larger proportion, of their earnings than heretofore, and not to save for Investment, directly or indirectly. If their money goes Into the banks for saving. It goes, necessarily, into Investment indirectly. Private fortunes must be held In check diu-tttg the lives of their owners by more progressive income taxes to a degree to discourage Investment, and at the death of their holders must be dissipated by Inheritance laws and taxes. Governments must collect much more In taxes than heretofore and spend the money In services and In construction that will not turn out goods to compete with private Industry. The way. with oiiT present equipment and technological advance, is now open for virtually unlimited cultural advance, because of our practically unlimited productive power. There is no limit to opportunities in this field, except our ability to produce goods. The amounts that may be spent on scientific research, education, and art, and a host of other things that will add Joy and beauty to life, have no other limit than the ability to produce goods. All we need to do Is to organize otir production and distribution and to take by taxation all above the amount necessary to keep up the capital investment. With a high degree of Inequality of fortune — Infi- nitely less than we have today — the richer people who have for generations had more than they could possibly spend and who can no longer find profitable Investment for what they save will In the future provide much more savings and investment than can be wisely or profitably employed. The chief task of the members of this committee, and of all Intelligent citizens now, is to see that funds available for pur- chxLslng power be taken by taxation as indicated above and placed In the hands of people that need the goods. Prices will then rl.se. taxes can be collected when people are producing and budgets can be balanced. Profits will reappear only when production begins. RKDUCnON OF PRINCIPAL OP LONG-TKRM DEBTS (By Leon Henderson. Department of Remedial Loans, Russell Sage Foundation) The Nation's Internal debt, short-and-long terra, at the end of 1932 was estimated at $240,000,000,000. The debt service was vari- ously estimated to equal in 1932 from 20 percent to as high as 50 percent of the national income. Contrary to the general impres- sion, only a small proportion of the debt pieces had been written off in the last 4 years, and the sum total of debt in force was tending to hold static because of State, local, and Federal borrow- ing. What Is not known Is how heavily the debt burden falls upon wage earners. Liquidation and debt adjustment have proceeded along individ- ualistic lines, with consequent disorganization and unequal pres- sure on different classes of debtors. The necessity for orderly proc- esses of writing down dead debts seems self-evident, with tiie further necessity for nationally planned Uqiildation. Several States have attempted to deal piecemeal with the debt burden, but in every case the State legislation has been declared unconstitutional, as violating the guaranties of property rights. The Canadian method of dealing with mortgage debt through provincial debt adjustment acts is giving a high meastire of satisfaction and will probably be extended to other debt burden. National legislation probably to create debt commissioners with power to settle differences is needed for sane handling of dead mortgage debt, whose dead weight rests heavily on purchas- ing power. L^ialatlon U needed also to amend the Federal Bankruptcy Act so that wage-earner debtors may make compoaltlon with creditors, based upon reduced earning capacity, with debt pay- ii2 CONGRESSIONi^.L RECORD— SENATE January 11 1929 had continued to 1932. the production of 1929 would have I after the coUapse the cash surplus existing in 1929 in 60 percent 1934 CONGRESSIONAL RECORD— SENATE 441 ments distributed over a long period. It Is absurd to think of balancing consimiption with production without such adjustment, or to depend upon local, State, or individual mechanisms to bring orderly results. REDUCTION IN INTEREST RATES ON LONG-TERM DEBTS By Lawrence Dennis, author of Is Caplltalism Doomed? The long-term debt of the United States grew from $36,000,000,- 000, or $387 per caplU. in 1913 to $134,000,000,000, or $1,072 per capita, in 1932. The Interest charges were $2,000,000,000, or 6 percent of total national Income in 1913, and $8,000,000,000. or 20 percent of the total national Income in 1932. Since 1929 the national income has been reduced by more than a half, while the debt charges have Increased somewhat. In addition to these figures covering long-term debts, there is outstanding some $103,- 000.000,000 of short-term debt, a large part of which is really long- term debt, because of perpetual renewals and because the interest paid on such nominally short-term debt Involves in large part a transfer of Income from a debtor to a creditor class. In the short-range view of the debt problem the depression is temporary; hence the thing to do about debts is to avert the calamities of foreclosures, bankruptcies, and defaults until the depression Is over. This can be done by having the Government declare moratoriums or lend the debtors money to meet their ma- turing obligations. In the long range view of the debt problem. Interest charges are regarded as contributory factors which must be eliminated or reduced, both in order to end the depression and to prevent Its return. The chief trouble with a large national bill for interest is that the recipients of Interest do not spend the money as fast as the Interest payers would spend It If they did not have to pay Interest. The Interest problem is mainly one of distribution of Income. The interest theory of old-fashioned liberals and orthodox econ- omists Is that during a depression interest rates should be lowered In order to stimulate Investment and to reduce production costs. Cheap money will tempt capitalists to Invest. Cheap money will mean cheaper goods; cheaper goods will mean larger sales. More Investment and larger sales will mean more employment and bet- ter business. This theory was fairly true to the realities of the nineteenth century when there were always abundant Investment opportunities to tempt capitalists whenever money and coods got cheap enough. There were always new markets for consumers goods when such goods became cheap enough. Today there are neither new Investment opportunities nor new markets. There is no more migration and tariffs nullify price reductions. There is but one good reason for a reduction of Interest today, and that is to effect a better distribution of Income. Money for public spending should be obtained without incurring interest charges, for any Increase In interest charges will only aggravate present evils. Moreover, any economy in interest charges on money used to build houses for the poor can bo fully monopolized by the landlord class. The fundamental consideration, however, is this: If the Government borrows from true investors w^ho buy Government bonds out of savings, It will have today to pay well over 4 percent for any considerable amounts of money. This rate Is obviously too high. Therefore, if the Government has to use the printing press in connection with its borrowing, the Govern- ment will better rely exclusively on the printing press, and not complicate Its borrowing with the printing press. The Government is using the printing press when it forceps the banks to buy Gov- ernment bonds. A reduction in our long-term debt burden can most easily be effected by Government conversion of railroad and farm and public- utility debt Into Government bonds and by a paying off of the short-term debt of the State with paper money. These operations will involve nationalization of the railroads and public utilities and the svibsidizing of agriculture. A condition precedent to such Government aid to agriculture should be appropriate measures to discourage, If not prevent, future borrowing by farmers. The basic idea in any sound treatment of the debt problem must be that interest charges have to be reduced with a view to securing a better distribution of money income. Lowering interest rates to encourage further uses of consumer credit or borrowing by Im- pecunious cities. States, or farmers is sheer madness. Such uses of credit are absolutely indefensible because of the problems created by the Interest charges. THE CALENDAR The PRESIDENT pro tempore. The calender, under rule VIII, is in order. The clerk v/ill state the first bill on the calendar. FINANCIAL TRANSACTIONS WITH DEFAULTING FOREIGN GOVERN- MENTS The bill (S. 682) to prohibit financial transactions with any foreign government in default on its obligations to the United States was announced as first in order. Mr. JOHNSON. Mr. President, I desire to perfect the phraseology of the bill. Mr. KING rose. Mr. JOHNSON. Does the Senator from Utah desire to Interrupt? Mr. KINO. Mr. President, a parliamentary inquiry. I Inquire, if I may, under what rule are we now proceeding? The PRESIDING OFFICER (Mr. Neely In the chair). Under rule vm. Mr. KING. Does that permit of debate? The PRESIDING OFFICER. It permits of 5 minutes' debate. Mr. KING. Does the Senator from California desire to take up his bill — a measure that is so important — under a rule which permits only 5 minutes debate? Mr. JOHNSON. I assumed that there was no objection to the bill. I do not see any reason why we cannot con- sider it. Mr. KING. I am not objecting to that being done. Mr. JOHNSON. Very well. The PRESIDING OFFICER. Is there objection to the present consideration of the bill? There being no objection, the Senate proceeded to con- sider the bill (S. 682) to prohibit financial transactions with any foreign government in default in its obligations to the United States, which had been reported from the Committee on the Judiciary with amendments. Mr. JOHNSON. I desire, Mr. President, to perfect the language of the bill. On the first page, in line 5, I desire to strike out five words, namely, the words " loan money to, or to." The PRESIDING OFFICER. Does the Senator offer that as an amendment? Mr. JOHNSON. I offer that as an amendment. The PRESIDING OFFICER. Is there objection to the amendment? The Chair hears none, and, without objec- tion, the amendment is agreed to. Mr. JOHNSON. The next amendment I propose is after the word " bonds ", in line 6. to insert the word " secm'ities." The PRESIDING OFFICER. Is there objection? The Chair hears none, and, without objection, the amendment is agreed to. Mr. JOHNSON. After the word " government **, in line 7, I move to insert the following words: issued after the passage of this act. or to make any loan to such foreign government. The PRESIDING OFFICER. Is there objection to that amendment? Mr. KING. Mr. President, I do not want to interfere with the passage of the bill but I desire to submit a few observa- tions, and that is the reason I made inquiry as to the rule under which we are proceeding. I may have to avail myself of the opportunity of speaking 5 minutes on each amend- ment in order to conclude what I desire to say. Mr. JOHNSON. I have no objection to any mode of pro- cedure that may be desired, provided we go on and dispose of the measure. Mr. KING. I will not interfere with the passage of the bill. The PRESIDING OFFICER. Does the Senator from Utah object to the amendment last offered by the Senator from California? Mr. KING. I desire to use the amendment as a vehicle to submit a few observations upon a subject which is not now before us but which is of very great importance, namely, bimetallism. The PRESIDING OFFICER. The Senator will proceed. REMONETIZATION OF SILVER Mr. KING. Mr. President, in the political and economic life of the people questions are presented and issues raised which demand solution. If they are correctly determined. benefits arise to the people, but if not properly solved they reappear and emphasize the oft-expressed thought that no question is settled until it is settled right. A great wrong was committed when silver was demone- tized and gold monometallism established as the monetary system in many parts of the world. But the silver question is not dead; it stands as a challenging figure In the political and economic path of all nations. Those nations which have demonetized silver are learning that the gold standard is an unsubstantial foundation upon which to rest their monetary system. 1934 CONGRESSIONAL RECORD— SENATE 443 442 CONGRESSIONi^.L RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 443 The devotees of the gold standard are discovering gold, which should be only a symbol, has become a tsrra a cruel and ruthless master. People evenrwhere are bekin ning to inquire why silver was robbed of Its monetary status and gold enthroned as the supreme monetary power. rThe gold standard as the sole measiire and standard of value is being challenged, and demands are heard in every qualrter that silver be rehabilitated and accorded its true status Professor Cassel. an outstanding political economist, has declared that " the relentless struggle for gold has broi ight a fall in prices which has resulted in a crisis produ:ing general depression, heavy losses, economic diflculties, and industrial unemployment ". all of which have assumed dis- quieting proportions. Many statesmen and economists believe that the world de- pression is, in part, if not largely, due to the demonetization of silver and the attempt to rest the credits and currencies and business activities of nations upon the narrow base of gold. The Inadequacy of gold to meet the demands of t ade and commerce and the needs of the people in their Indus Tial and economic life is recognized by many of the leadeis of the political and economic life of the world. Sir Henry Strakosch declares that the deflciencie; of monetary gold are well over 100 percent and this has resiJted in a sharp fall in commodity prices. Sir George Paish has stated that the financial situati< n is one of unprecedented difficulty and the world, particuarly since 1914, " has lived upon credit and is indebted, both na- tionally and internationally, for fabulous sums of moi ey." The indebtedness of the world is so stupendous as to ( om- I)el the thought that bankruptcy is inevitable. Publijhed statements by banking institutions and economists indcate that the indebtedness of the United States — National, aate. corporate, and individual — exceeds $200,000,000,000 and the obligations of other nations indicate an almost hopeless con- dition of indebtedness. Sir Joshua Stamp states that the financial depressicn is largely due to the instability of money values and to the relative insufficiency of the world's stock of gold anc its converse, the weakness of commodity markets. Even Mr. Keynes, the great English monometallist, de- clares that gold as the sole standard of purchasing pdwer " Ls almost a parvenu ", by which he means that for t lou- sands of years gold and silver were the standards of \alue and purchasing power at an accepted ratio of value, anl he is compelled to admit that except during brief intervals gold has been " too scarce to serve the needs of the world's i irin- cipal medium of currency." There is no validity In the contention that gold is not subject to fluctuation. The fact is that measured by (om- moditles, by the things which it purchased, its variat ons, and. indeed, gyrations, indicated that it was a most ui sta- ble commodity and an unsatisfactory measuring rod It fluctuates, when measured by labor and commodities: and measured by any standard of value or by commodities, it possesses less merit or value than silver would have pos- sessed had it not been demonetized. Value simply means value in exchange, and it arises out of relations which ;xist between things. Money, intrinsically, has no value. E*ur- chasing power is a value in economics. The level of prices of commodities is determined by the number of units of purchasing power; hence, if the nuiober of units are reduced, each remaining unit possesses gr( ater value, expressed in commodity prices, and the prices of < com- modities, measured by the monetary unit, fall. Value, like utihty. it has been said, possesses no intrinsic value bui ex- presses in exchange nothing but ratio. To speak of the value of an ounce of gold is as absurd OS to speak of the ratio of a given number. There mu: ;t be another number in order to make a ratio. Therefore, y alue simply means value in exchange. Human estimation placed on desirable objects whose quality is limited detenqines value. For thousands of years gold and silver walked side by side carrying the trade and commerce of the world. Mcther earth has for thousands of years yielded these two precious metals, the ratio of production being substantially 14 ounces of silver to 1 ounce of gold. Sir Archibald Allison, in his History of Europe, states that Great Britain, largely at the instance of creditors and bankers, denied silver access to the mints and made gold the sole standard and measure of value; and he declares that the capital which had been acquired during the Napoleonic Wars, and the interest of the money classes, were so power- ful "that Parliament became affected by the desires of its possessors." This resulted in the demonetization of silver, which, within a few years added 50 percent to the value of money and 50-percent weight of debt and taxes. Small land proprietors were ruined and distress was universal. " The number of landowners, within a period of 7 years was re- duced from more than 160.000 individuals to less than 30,000 and a large population became the objects of support by organized charity." The inadequacy of the gold standard to meet the monetary demands of the world must be apparent to every thinking person. Great Britain, which has boasted of her financial strength and power, and for a century has been the cham- pion of gold monometallism, has been compelled to abandon the gold standard, and in so doing dragged other nations from their insecure gold pedestal. Sir Henry Deterding. a world financial figure, has con- fessed that the destruction of silver values will defeat trade revival, and that so long as gold and silver were in coopera- tion " things went well, but that governments, governed by theorists and sheltering themselves behind so-called " money experts ", adopted gold as their sole standard of value and have ousted silver by paper. Whether paper is represented by bankers' bills or by bank notes, the only rea.son for its value is credit, and credit is the same as every other com- modity or faculty in that the more there is of it the less valuable it becomes." It is obvious that of all acceptable systems of currency that system is assuredly the worst which gives a standard, steadily, continuously, and definitely appreciating and which by that very fact throws the burden upon every man of enterprise, upon every man who desires to promote the agri- cultural or the industrial resources of the country, and benefits no human being whatever. The occidental nations in destroying silver are develop- ing an oriental competition in the fields of industry, which menaces business and industrial revival and the return of prosperity. It has been said that there is an element of justice in the cruel and irrational policy of demonetizing silver adopted by occidental nations and in the increasing in- dustrial development of China and Japan and India. By de- monetizing silver, China and India were robbed of monetary values to the extent of billions of dollars. Their stored wealth, consisting of billions of ounces of silver, was reduced in value, measured by gold, from $1.29 or more an ounce to the low mark of 24 cents an ounce. But. as indicated, this policy has resulted in depriving the occidental nations of markets of great value, and has changed oriental nations into aggressive and successful competitors in the markets of the world. It is imperative that a change in the mone- tary policies of this and other nations should promptly be inaugurated, if unrest, and indeed, economic and political disturbances are to be arrested and the world lifted from the valley of depression. Recent investigations by experts and committees in this and other countries have led to the conclusion that com- modity prices must be increased if this destructive pericd of depression shall come to an end. Even the most ardent gold monometallists admit that there must be an increase in commodity prices. Important reports submitted by the League of Nations and by the McMillan Committee of Great Britain, demonstrate that if nations and individuals are to he rescued from bankruptcy, there must be a material in- crease in prices, particularly in the fields of agriculture and labor. It is impossible for the people of the United States, as well as other nations, to meet their obUgations, if mate- rial increases in commodity values do not occur. That the remonetlzation of silver would increase com- modity prices is conceded by all. In the great contest of 1896 the goldites opposed bimetallism largely upon the ground that it would cheapen money and therefore in- crease prices. They contended that gold was the only " honest money " notwithstanding the fact that under its reign its value, measured by the products of human toil, had greatly increased and want and ruin had come to hundreds of millions of hiunan beings. It was conceded by the gold- standard followers then, as it is conceded now, that for centuries bimetallism had been the monetary policy of most countries of the world, and though there were variations in the ratio and production of gold and silver, they had marched side by side with but slight variation in their value with reference to each other and the purchasing price of each. The fathers of this Republic not only understood the science of government, but they were students of monetary and economic problems, and knew the relation of money to the political, economic, and industrial life of the people. In the Constitution which they prepared, gold and silver were recognized as the ba.se of our monetary system; and in the first measure enacted they declared for bimetallism, and provided that 371 Vi grains of pure silver should be the dollar and unit of value, and that 24^4 grains of pure gold should be of equal value. That the demonetization of silver in this and iii other countries was a great w^rong and an injury of the most serious character, it seems to me should be evident to all students of governmental and economic affairs. With the defeat of Mr. Bryan, the gold monometallists believed that the silver question was forever laid at rest. The failure of the gold standard to meet the needs of the world and the tragic economic and industrial conditions confronting this and other countries have compelled a reexamination of the sufficiency of the gold standard and the financial policies which have been pursued under it; and the result has been that the people, sitting as a high court of justice, have de- creed that the gold standard has failed to meet the promises made in its behalf, and that silver must be restored to its rightful place as a coequal with gold. It is true that there is not complete unanimity in the plan to be pursued in restoring silver to the position of primary money, but there is a growing determination that some measiu-e be adopted that will result in the rehabilita- tion of silver. In 1930, in various parts of the United States, organiza- tions were effected for the purpose of awakening the Ameri- can people to the importance of restoring silver to its rightful place. Tlie Senator from Nevada [Mr. Pittman] and myself offered resolutions in the Senate challenging attention to the continued decline in commodity prices and to the impor- tance of obtaining for silver a suitable place in the monetary systems of the world, in order to avert the disastrous conse- quences that would follow a further decline in the price of silver. The Senate Committee on Foreign Relations made a com- prehensive study of the effect upon commodity prices by reason of the demonetization of silver; and later a committee in the House of Representatives devoted considerable time to a study of the silver question, and the effect upon the economic and industrial conditions of this and other coun- tries by reason of legislation and policies which had resulted in depriving silver of its status as primary money. Since then there has been an increased interest in this and other countries in the so-called " silver question ", and organiza- tions have been formed in this and other countries to pro- mote the rehabilitation of silver. Mr. LEWIS. Mr. President The PRESIDING OFFICER. Does the Senator from Utah yield to the Senator from Illinois? Mr. KING. I yield. Mr. LEWIS. Will the Senator from Utah, acquainted and qualified as I know him to be on this subject, at this point explain in what way he concludes that silver was de- monetized; and at the time to which he refers what was the particular thing which, in his judgment, served that purpoee and accomplished that object? Mr. KING. I cannot, in the limited time at my disposal, adequately deal with the matter suggested by my eminent friend from Illinois. I can only submit a few observations hoping that they may have some bearing upon the matter under discussion and meet in a small way his inquiry. Until 1816 gold and silver were recognized as primary m.oneys in substantially all countries of the world. Bimet- allism was a part of the monetary systems of most nations. As is well known, among primitive peoples commodities were exchanged, and barter was the universal rule; but as civili- zation advanced and international relations increased, it was found imperative that there should be a medium of ex- change— a measuring rod — a plan under which commercial transactions might be' faciUtated and balances of trade which resulted from such transactions settled. It was dis- covered that gold and silver were better suited for monetary purposes than any other metals, and it was also discovered that there was a natural ratio between these two metals. When 1 oimce of gold was taken from mother earth there were between 14 and 16 ounces of silver mined. It was rec- ognized that the production of the two metals went hand in hand at a ratio of 14 or 16 to 1. By custom and by regula- tions and laws, gold and silver were made the moneys of most countries. Credits were extended, based upon agree- ments to pay in gold or silver, or both. Taxes imposed upon the people for the maintenance of governments were met by the payment of gold or silver, or both. In the days of Napoleon gold and silver were universally recognized as the moneys of civilized nations, and consti- tuted the base upon which currencies and credits were rested. Bonds and obhgations of governments were payable in these metals. England and France, and other European countries, coined both gold and silver at a ratio of 15 or 15^ to 1. When they issued securities, those who purchased the same understood that they were to be paid in gold or silver, or both. Bankers and traders, as well as the people, realized that the quantity or amount of money available greatly infiuenced trade and commerce. When gold and silver were abundant, it was discovered that wages were higher and commodity prices were enhanced; and, conversely, when there was a limited amount of gold and silver in circulation, prices fell and labor was poorly paid. The holders of securi- ties were not indifferent to this fact, and greedy and selfish persons sought to limit the circulating medium. Accord- ingly, in 1816, bankers and financial interests. Including the Rothschild family, secured the demonetization of silver in Great Britain. They perceived that IT money was scarce it would be dear and commodities would be cheap. Indus- trialists in Great Britain, knowing that their coimtry lud but a limited supply of raw materials, believed that it would be to their advantage if a monetary system were adopted that would cheapen commodities and increase the price of money measured by toil and commodities. British consols and other secm-ities, following the Napoleo- nic wars, were held by the Rothschilds and a limited num- ber of bankers, and they secured legislation in 1816 which closed the mints of Great Britain to the coizutge of silver and practically placed Great Britain upon a gold-standard basis. The obligations of the Government then became pay- able in gold and, with the demonetization of silver, gold ap- preciated in value measured by commodities; as a conse- quence of which bonds, consols, and other sectulties became more valuable. The value of raw materials needed by Great Britain, when measured by gold, were of less value. This was the first important assault made upon bimetallism and its consequences in Great Britain were calamitotis. The values of commodities were reduced; tens of thousands of lando\^Tiers lost their holdings; wages were reduced; and poverty and distress came to the British people. Prance, the United States, and other nations did not then follow Great Britain, but continued their use of gold and silver as basic money. Predictions were made by eminent economists and statesmen that the destruction of either gold or silver as primary money would result in disastrous consequences to CONGRESSIONAL RECORD— SENATE January 11 ino.4 r'/^XTr'l>T7«C«C r^ r\rt r\ niT^XT a m-wzt 444 CONGRESSIONAL the people. When Germany defeated France in 1871, she ex - acted a monetary indemnity consisting of $1,000,000,000 ii gold. Prance paid this stupendous sum, and thereupon Oei - rnsmy — doubtless influenced by the course of Great Britaii in 1816 — demonetized sliver and adopted the gold standard. I might add parenthetically at this point that there s much hypocrisy in the contention that silver is unworthir of the position of primary money and that gold alone is en- titled to the high distinction of being basic money. Ger- many's course emphasizes this fact. When California anl Australia, between 1849 and 1856. were pouring into the channels of trade and commerce great streams of gold. Gei - many and a number of other European nations contendel that gold was the cheap metal, that silver alone was worth 7 to be crowned as primary or basic money, and therefore demonetized gold. But when the stream of gold was great! y reduced, and the silver mines of Nevada gave to the worll hundreds of millions of ounces of silver, then Germany con- tended that silver was the cheap money and gold alone wa s primary money. As Senators know, oiu- monetary system was bimetallic. The Constitution recognized that fact, and bimetallism was adhered to by our Government until 1873. I shall not tres- pass upon the time of the Senate to point out the devious course pursued by certain interests in the United States following the Civil War, a course which culminated in the demonetization of silver in 1873. A measure was passed ty Congress, which it has been charged was done surreptitiousl y if not corruptly, which in effect resulted in the demonetizi - tlon of silver and the enthronement of gold as the sole bas c money of our Government. President Grant, a year after he had signed the bill, mac e Inquiries as to why silver was not being minted, and when told that silver had been demonetized, demonetized by an act which he signed, he expressed surprise and insisted thi t he was not aware when he signed the bill that its effect wa s to close the mints of the Government to the free coinage of silver. Similar serious economic and industrial disturbances re- sulted in the United States by reason of the demonetizatio 1 of silver, as had occurred in Great Britain following the adoption of the gold standard there in 1816. Between 18'] 3 and 1880 property values in the United States shran: hxmdrcds of millions of dollars. UnemplojTnent was Nation - wide and a depression more serious than any the country had ever passed through was visited upon the people. In 1896 we were still suffering from the evil effects of silvers demonetization. I might add in passing that the great leaders of the R( - publican Party— McKinley. Garfield, even John Sherman, and others — had declared in favor of bimetallism, and ye;, In 1896. when the issue was sharply drawn, the Republican Party condemned Mr. Bryan and the Democrats because er economic relation If commodity prices are to be permanently affected. COMMODITT PaiCE EPTBCT This wUl prevent a recurrence of what history shows to be always the result of setting a commodity price on the white metal. The war time purchasing act is an example. This provided for the melting and sale of 200.000,000 silver dollars then held In the United States Treastiry. to England at $1 per ounce, to be replaced from domestic production at the same price. This resulted, to quote that eminent Jurist, Frank H. Norcross, of Nevada, United States Federal Court, western Jurisdiction, who. In 1922. said: " Whatever may be said for the gold standard, it cannot be said that it had its inception in any spirit of altruism. " For a score or more of years Uncle Sam has been supplying 40 percent of the world's silver output. It would seem that he has failed to comprehend the importance of that fact. For a recent Illustration: Uncle Sam produced 75,000,000 ounces of silver in 1915. That year the ratio of production of silver to gold was ths lowest of record, 7 to 1. With war prices on other products prevailing. Uncle Sam, without protest, permitted British influ- ences to drop the price to the lowest flgvire in th; history of the metal, a price ratio of 40 to 1. Great Britain needed silver badly for her East Indian colonies, where it was transferred at a profit of 300 percent. A couple of years later more silver was required for India than the regular market afforded. Uncle Sam was offered a dollar an ounce for his whole Treasury stock. Appar- ently delighted over the opportunity, he shipped to India nearly 300,000.000 ounces — all he had. Great Britain only made a trifle less than a hundred million dollars on that deal and still owes us for the silver." After this transfer was accomplished silver was again forgotten. The total amount was never replaced at the agreed price. Any plan other than a definite place as primary money and the relation between the metals established by law will again. In the last analysis, subject this important metal to the same treatment. The monetary history of the nations shows periodical attempts to gain advantage by manipulation of the money standards of the world, which in every case has been only temporarily successful. The pendulum has swung back and forth two or three times from a bimetallic to a single standard and it would seem from recent events that we are about leady to again recognize the truth of the statement quoted by Tuck, of that great economist Turgot. who. as Minister of Finance to Louis XVT, said. " Gold and silvzr are constituted money, and universal money, by the nature of things. Independently of all convention and all law." England has always taken the lead in establishing the value and the relation between the money metals, and it has not always operated to our advantage. Eighty percent of the sUver of tbe world is produced in North America, yet the silver market is fixed in London; therefore, it is believed that the time has now arrived for the United States to set the pace and est^iblish the kind and amount of oxir medium of exchange best suited to serve Ham majority of our people. iifi CONGRESSIONAL RECORD— SENATE January 11 I 1934 CONGRESSIONAL RECORD— SENATE 447 446 CONGRESSIONAL VSUDUCTIOIf AWD nlCt If the United States were to purchase the entir© annu^ mestlc output of silver at the prewnt legal figure of $1.29 ounce. Instead of the announced price of 64.6 cents, and the . ductton should again reach the normal of approximately 50.000 oxinces annually, which Is practlcaUy twice the present output, would take fully 20 years to add a blUlon dollars to the cxur*^ For OTer 400 years the ratio of world production of sUTer to of gold has been approximately 15 to 1. suFPoax de- an prn inclui le Tenni s- of Or ego a. to lof Q of .•urren cy xlni ic agree abscrb a: id tie t le tie is If in of OF BTABILHATJON Eren If none of the things Is brought about which leading economists predict will be the result of stabilizing the price gold and silver in their proper relation, such as Increased forel ; trade with the silver-using nations, with the natural result - Increased commodity prices, all agree that metal-backed c is more stable than paper because the metal Itself has an intrln^i value without the Government stamp, and In addition, all that the metal-producing States will Immediately start to their own available labor supply and to purchase materials supplies from other States. It will do for these States what cotton, wheat, corn, and hog program Is designed to do for States producing these commodities, and Is an essential part of whole recovery program. It Is freely predicted that If the price of gold and silver stabilized by law at their proper relative values the unemploym^t problem in the 11 Western States wUl be reduced to a minimum In a relatively short time. KTFSCT or PBZSSNT PKICS Some have called the Increased price of 64.5 cents per ounce l^r silver a 50 percent bonus for the producer, when as a matte: fact, with the price of stiver dollars set by law at 91.39 per oun^e it will still mean a profit for the Government of 100 percent sliver certificates are issued agsUnst the silver accumulated the Treasury by this method. On a basis of the former price 32 cents per ounce the Government made a profit at over 4|00 percent when the silver dollars were coined. icTTAi. oa TAna. Metallic money back of currency is the sotindest way to Insilre full confidence in the monetary system, and if a person holding a piece of paper money knows that he can get a chunk of me al for it — with the metal Itself bearing an Intrinsic value — that per •on will not worry about the safety of the currency. Numcrcus economists believe that more money should be In circulation, and • restoration of silver to Its basic place of centuries as a prlmi ry money metal would bring about a further expansion of the clrc u Isting medltim. PKODCCnON BT- PRODUCT The average annual production of silver In the United States during the last 30 years has approximately been 55,000.000 ounces, falling as low as SC.OOO.OOO ounces In 1931. The world's annfial production has ranged from 175,000.000 to 250,000,000 ounces, w the United Btate&. Mexico, and Canada producing more than percent of the entire amount. Most of the silver production •s a by-product from copper, lead, zinc, and gold mines and from pure ^ver mines: therefore there would be no Inciease in the annual production of silver luitil there was lAcreeaed demand for these other metals. An increase in the price of silver would not enable these otker mines to go blasting Into production, because the silver content of thetr ores would not Jiutlfy operating unless the prices of he other metals were much higher than their present levels. Tlien commodity (trices must increase before anyone benefits. BATio F«ic« AW© raoowmoK During the last 2 centuries silver has fluctuated from a n^o of from 15 to 1 to 77 to 1 with respect to gold, and these extreme variables are not Justified by the record Inannuch as the prod ic tlou of silver in the past 400 years has been approximately 15 times the production of gold In ounces. MCTHOO We are not advocating bimetallism, symetallism. or a purchase program as such, but the Western States feel that If commotitty prices are to be permanently affected that the two soain prlnci; 1 must be recognized and established by law: First, that sUver stiall be a primary money metal, which position It held throughout world untU 1873; and. second, that the price or value In buying power terms of an ounce of silver be stabUlaed In the propei economic relation to gold. th 60 coiAes not lal an subetani lal RECORD— SENATE January 11 [Record of production, taken from the Silver Market Dictionary by Herbert M. Bratter, p. 125) Percentages of total mine production of gold and silver, by weight, consisting of each, of these two metals since 1493 Ferial Percentaze o' pro- ductio:; by weij li Gold silver 1 493-1520 — -- 11.0 7.4 27 22 17 20 21 23 27 3.1 15 4.2 4.4 3.1 2.0 19 21 3.0 3.3 6.6 IK. 4 IS. 2 14.4 12.7 8.7 6.6 5.0 4.5 4.8 7.0 8.5 10 5 B.8 9.5 9 4 9.0 9 0 &9 9.5 no 11.6 10 8 9 8 8.3 8.9 8.5 8.4 6.8 6.7 7.4 7.2 7.1 7.1 7.1 «.9 7.7 lae 800 1.S21-44 926 l.M.V-CO .. 97 3 1.WI-H0 - ISKl-iSOO 97 8 9K 3 1601-20 9aO 16'.;i-40 ' " - - - 97 9 1641-60 - 97 7 ICTil-O 97.3 1W1-I700 - 9(1 9 1701-20 - 9f.. 5 1721-40 95.8 1741-flO ..-- - 95.6 17*1-80 - 96.9 1781- ISOO - - 98.0 lWI-10 - 98 1 l,Sll-20 - 97 9 1821-30 97.0 Ifr^t-40 9« 7 1841-50 . . 93 4 1R51-55 ... . — 81.6 lR5ft-fl0 " " "" ... - 1 81.3 18fil -65 . .... - 1 85.6 1S66-70 — 87.3 1S71-75 91.9 LS7S-S0 93.4 1881-85 96 0 is^fl-go 95.3 l'*«l-95 — 9S.3 IhWVISOO .- 93.0 T9f)l-5 01.5 igO) . 80.5 1907 90.2 itm " 90.5 )909 90.8 jftlO 91.0 1911 91.0 1912 . 91.1 1HI3 . 90.5 Ifil4 80.0 1V15 . 88.4 igifl . 88.2 1917 90.2 I*tl8 — 1919 . 91.7 91.1 1920 91.5 1H21 . . 91.6 IQ-^ 03.2 1623 93.J 19^4 929 l'»2S 92.8 1926 92 9 ISi^ „. ........ . .... 92 9 IQOS .... ... • 92.9 H<29 . . 93.1 lyjO -- 92.3 ijai - — 89.4 Total 6.7 1 93.3 1 It will bo noted that from 1493 to 1931. Inclusive, shows an average of 6 7 percent gold and 93.3 percent silver, which is almost exactly 14 to 1, or 14 ounces of silver to 1 ounce of gold produced since Columbus' discovery of America. Geo. W. Malone, Chairman Western States Silver Committee. Reno, Nev. riNAXCIAL TRANSACTIONS WITH DIFAULTINC FOREIGN GOVERN- MENTS The Senate resumed the consideration of the bill (S. 682) to prohibit financial transactions with any foreign govern- ment in default on its obligations to the United States. The PRESIDING OFFICER. The Question is on agreeing to the amendment on page 1, line 7. The amendment was agreed to. The PRESIDING OFFICER. The amendments reported by the committee will be stated. The Chief Clerk. On page 2, line 4, it is proposed to strike out the word " people " and insert in lieu thereof the words " to any citizen." The amendment was agreed to. The next amendment was, on page 2. line 5, after the words " United States ". to insert the words " or to any corporation organized in the United Stales." The amendment was agreed to. The PRESIDING OFFICER. If there be no further amendment, the question is. Shall the bill be ordered to a third reading and read the third time? 448 [AL CONGRESSIONAL RECORD--SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 447 The bill was ordered to a third reading and read the third time. The PRESIDING OFFICER. The question now is, Shall the bill pass? Mr. KING. Mr. President, it may be that some Senators who are not now in the Chamber desire to be here when the bill shall be finally acted upon. Mr. JOHNSON. I know of none. Mr. KING. I may say, then, that I have no objection, with the understanding that if it should develop that some Senator desired to be present, I may move for a reconsid- eration. Mr. JOHNSON. Very well. The PRESIDING OFFICER. The question is, Shall the bill pass? The bill was passed, as follows: Be it enacted, etc.. That hereafter It shall be unlawful for any person within the United States or any place subject to the juris- diction of the United States to purchase or sell tlie bonds, securi- ties, or other obligations of any foreign government Issued after the passage of this act. or to make any loan to such foreign gov- ernment. Including any political subdivision thereof, while such government or political subdivision is in default In the payment of its obligations, or any part thereof, to the Government and or to any citizen of the United States or to any corporation organized in the United States. Any person violating the provisions of this act shall, upon conviction thereof, be fined not more than 910,000 or imprisoned for not more than 5 years, or both. Sec. 2. As used in this act the term " person " includes Individual, partnership, corporation, or association. Mr. ROBINSON of Arkansas subsequently said: Mr. Presi- dent, earlier in the day, while I was imavoidably absent from the Chamber, it appears that a bill was considered and passed by the Senate which penalizes with a fine of not more than $10,000 or imprisonment for not more than 5 years, or both, any purchase or sale of stcurities issued by a foreign government at a time when the foreign government is in default on indebtedness to this Government or to any citizen or corporation of this Government. That means, according to the express language employed, that if a person owns a bond issued by one of the foreign governments in default on its obligations to this country, or to any citizen or corporation in this country, and sells it to another citizen of the United States, he commits a peniten- tiary offense. It means that every foreign bond now pos- sessed by a citizen of the United States is, by provision of law, made nontransferable, and the holder of the bond, no matter what his extremity or his necessity may be, if he sells it, is subject to imprisonment in the penitentiary and to heavy fine. I enter a motion to reconsider the vote by which the bill was passed. Mr. WALSH. Mr. President, is it possible that a provision of that seriousness escaped the attention of the members of the committee? Mr. ROBINSON of Arkansas. It is not only possible but it is literally true. The language of the bill as reported is as follows: That hereafter It shall be unlawful for any person within the United States or any place subject to the jurisdiction of the United States to purchase or sell the bonds or other obligations of any foreign government. Including any political subdivision thereof, while such government or political subdivision is in default in the payment of Its obligations, or any part thereof, to the Government and or to any citizen of the United States or to any corporation organized In the United States. Any person violating the provi- sions of this act shall, upon conviction thereof, be fined not more than 110,000 or Imprisoned for not more than 5 years, or both. Sec. 2. As used In this act the term " person " includes indi- vidual, partnership, corporation, or association. I do not know the limitations in the mind of the distin- guished Senator from California tMr. Johnson], who intro- duced the bill. I am sure that he did not intend to render valueless or nontransferable bonds that are owned by citizens of the United States. Mr. FESS. Mr. President, will the Senator yield? Mr. ROBINSON of Arkansas. Certainly. Mr. FESS. I understood that the bill had been amended so that it applied only to securities issued after the passage of the act. It does not Include what the Senator has In mind at all. If it does, it is not at all what I thought it was. Mr. ROBINSON of Arkansas. There is. I find on exam- ination of the desk copy, in the draft as it was finally passed, an amendment limiting the application of the penalty to securities issued after the passage of the act. But, Mr. President, this is a very extraordinary bill even as modified. It is a very extraordinary provision of law to put a man in the penitentiary, or fine him $10,000. for buying a bond or other security. I enter a motion to reconsider the passage of the bill. Mr. JOHNSON. Mr. President, may I suggest, if it is desired to argue the proposition, that we argue it and present it fully? I shall be very glad to do so. Mr. ROBINSON of Arkansas. I shall not go further into the matter while the Senator from New York has the floor. I was induced to make the statement that I did by questions that were asked. I find that the bill was amended so as to make it apphcable only to securities issued after the passage of the act. I enter the motion and will confer with the Senator from California and other Senators about the matter hereafter. Mr. KING. Mr. President, may I say that while I was on the floor, and was discussing another measure, and was being called from the Chamber. I suggested to the Senator from California that I might call for a quorum and asked him if there was any objection, so far as he knew, to the bill. Upon receiving what I beUeved to be his assur- ance that he knew of no objection. I stated that I would not call for the quorum, but if later I desired to have the passage of the bill set aside. I understood the Senator to say that he would assent to that and restore it to the calendar. Mr. JOHNSON. Mr. President, I should have been de- lighted to argue the measure, and argue it elaborately or in any other way, ever since its introduction. This is no new bill that comes before the Senate. This is a bill that was introduced in the last sessicm, that went to the Judiciary Committee, that was approved by the Judi- ciary Committee, and a report filed here. Not only that, but at the very beginning of this session I stood upon the floor of the Senate and gave notice that I would call up this bill and press it to a conclusion at the earliest possible moment. It is no. 1 on the calendar. Yesterday, in the debate that ensued upon the amendment presented by the Ssnator from Missouri [Mr. Clark], I called attention to the bill, and to the fact that it was num- ber 1 upon the calendar; and today it was the first bill called. I want no man to have any misunderstanding or any mis- conception of the measure; and I shall be delighted to take it up in any fashion that may be desired and argue it upon the fioor or meet with my friend from Arkansas and talk over the matter in any way that he may desire. Mr. ROBINSON of Arkansas. I content myself with merely entering the motion to reconsider now. and we will discuss the subject and confer about it later. Mr. JOHNSON. Very well. Mr. McKELLAR. Mr. President, would the Senator object to restoring the bill to the calendar? Mr. JOHNSON. Let it stay as it Is. The motion has been made. I will do nothing in the interim, and then we will confer respecting It. Mr. ROBINSON of Arkansas. The motion that has been made will delay the sending of the bill to the body at the other end of the Capitol. Mr. JOHNSON. I assume so. Mr. ROBINSON of Arkansas. And I am entirely content with the arrangement to which the Senator has agreed. Mr. McKELLAR. I am very happy that that has been done, because I had an understandiiig with the Senator from Utah [Mr. King] that he would call a quorum if the bill was put upon its passage; and I did not know it had been put upon its passage because a quorum was not caUed. as has been explained by the Senator from Utah. Therefore, 1934 CONGRESSIONAL RECORD— SENATE 449 power terms of an ounce of silver te stabUlaad In the profer cconomlc relation to gold. <»&mAV AA«.AAA4V 4^V| w «f ««%rfcJbax/a.a **?* k.^**!*** w«*^* third reading and read the third time? AJ V\J OVrVftAX XI^AWkJ 4J>;r%i\A'mf\A tMAVX^A VA^S^ ^Ci»k.PVM>»^«. 448 CONGRESSIONAL RECORD— SENATE January 11 I am very h»ppy that the Senator from California Is will^ig to let that course be taken. suravmoif or foreigh coiocwicial tkamsactions The PRE8IDINO OFFICER. The clerk will sUte the n*xt bill on the calendar. [ The bill (S. 882) to provide for the more effective super- Tlslon of foreign commercial transactions, and for otl^er ptirposes, was announced as next in order. Mr. JOHNSON. I ask that that bill be passed over. The PRESIDING OFFICER. The bill will go over. otDKB or Busnntss Mr. COPELAND. Mr. President, may I ask whether the intention to go through the calendar and as to many bills there are on the calendar? The PRESIDINO OFFICER. The Chair la informed there are about 20 bills on the calendar. Mr. COPELAND. I must be away for a few days and desire to get the floor for a short time, but I shall wait uitil the morning hour is ended. I give notice now of my desire to take the floor at 2 o'clock. Mr. KINO. Mr. President, if I may have the attention of the able leader on the other side. I may say that nuny of the Senators are engaged in important committee meet- ings— a meeting of the Committee on Banking and Currency and many others. Some 12 or 14 Senators, members of a c(»nmittee with which I am identified, will be compelledl to meet at 2 o'clock to consider a bill which must be reported afi soon as possible. The subcommittee of the Committee! on Post Offices and Post Roads, presided over by the Senator from A^«^^»»"* [Mr. Buick], is in session, and there ire others in session requiring the attendance, of Senators. Mr. McNART. I have anticipated that situation, and I ask uiumimous consent that we defer further ccmsiderat on of the calendar for the day. Mr. KINO. I suggest that the Senator from New York [Mr. CorsLAirD] be given opporttmity to address the Senate at this time. Mr. McNARY. I think that has been arranged for. The PRSSIDING OFFICER. Is there objection to he request of the Senator from Oregon? The Chair heart nc ne, and the eatondar will be laid aside for the day. ■■rraicnoif ow csnciiiAL Acnvrnu Mr. COPELAND. Mr. President, several Important vctes were taken this morning. I am sorry I was not here to record ny preference regarding each of the matters before the Senate. It so happened that I was detained at he White House by the President, and I am anxious to hive this reference in the Recoko so that it will be apparmt that I was not evading any votes which were taken. Mr. Prealdent, It will be recalled that last spring towird the end of the session the Senate saw fit to adopt a resc lu- tion submitted by me directing the Committee on Commence, or any subcommittee thereof, to investigate the subjec kidnaping, racketeering, and other forms of crime. Ac on that Instruction the Commerce Committee appoln subcommittee consisting of the Senator from Michigan [ VANOKKBBitc]. the Senator from Iowa [Mr. MxntPHT], niyself as chairman. This committee has been very active during the past sunmier and fall. Hearings were held in various parts of the country, notably in New York. Etetnoit, and Chicago, and certain conclusloivs have been reac:)ed by the subcommittee, conclusions which, I assume, shculd now be presented to the Senate. In making this presentation, we wish It to be understcxxi that this is a preliminary report. Our activities have d( »n- onstrated that there, are many crimes which deserve the serious attention of the Senate. We shall expect from t me to time to present our conclusions so far as they are fori lu- lated, in order that any legislation which may be requ red shall be promptly enacted. This morning we have 13 bills to present iar the connd- cratitm of various conmittees of the Senate. I know that that seems like a tronendous grist to put into the legisla >ive Bill, but many of the measures proposed relate to trif ing changes In existing law. Those measures are intended to stop gaps through which criminals make their slimy way. In addition to the measures to correct existing law, we are presenting some other plans and bills which we hope will add to the protection of the American people against crime and the criminal. I regret to say, but I think it is a fact, that the popular idea in this country is that there has been a break-down in the administration of criminal law. It so happens that every member of the subcommittee is a layman, so far as law Is concerned, and perhapfe it was wise that in the selection of the committee there should be appointed men who may be considered outsiders. Perhaps we were less boimd by tradi- tion and legend than men skilled in the profession of the law might be. I wish to state, however, that in the preparation of the measures which we will present we have had the hearty support and cooperation of the Department of Justice. The Attorney General himself is much concerned over criminal activities in America. Through his instruction his assistants have given the committee every possible aid. I wish to speak particularly about Mr. Joseph B. Keenan, who is the Assist- ant Attorney General in charge of investigation of criminal activities. Mr. Keenan has shown not only an interest in this matter but he has brought to bear upon it an in- telligence and professional skill which I think are quite unusual. We have had the aid. too. of the old-time experts of the Attorney General's Office. Therefore, Mr. President, I should not wish you to think that because we upon the com- mittee are lasrmen we have failed to avail ourselves of the most expert legal advice we could find. In that connection, too. may I mention that through these various hearings we have had the testimony and the advice not alone of officials of government, United States district attorneys, and other officials of the Federal Government but we have had also the hearty cooperation and assistance of State officials. Men from my own State— Judges, district attorneys, and eminent lawyers — have appeared and given testimony and advice. We had In Detroit the advice of the able prosecuting attorney of Wayne County and other officials of that State, In Chicago we had a great gathering of United States district attorneys, SUte prosecuting ofRcerf, and others. We have had also the assistance of police offic<»rN, the International Police Conference, and other active police agents. All this work has demanded attention to many details. The committee Is unanimous In the feeling that we have been very fortunate In having Col, Franklin S, Hutchinson, of Rochester. N,Y.. as the official in charge of the investiga- tion. He has from the beginning been actively at work, and still is, and the Senate owes a great debt of gratitude to Colonel Hutchinson because of his work. Mr. VANDENBERG. Mr. President The PRESIDING OFFICER (Mr. McKellar in the chair). Does the Senator from New York yield to the Senator from Michigan? Mr. COPELAND. I yield. Mr. VANDENBERG. Mr. President, while the Senator is referring to those to whom gratitude is due for the useful results and valuable information gathered by this subcom- mittee. I should like to offer an observation as a member of the subcommittee. I should like to say that the net results of this undertaking, which is now being submitted by the Senator from New York, and which, in my judgment, represents one of the major challenges to this session of the Congress, would never have accrued except for the leadership of the Senator from New York himself; and as one who has been permitted to labor in a humble capacity in connection with this undertaking, I wish to state for the Record that the Senate and the country are imder a great obligation to the Senator from New York, not only for initi- ating this inquiry but for the emphasis he has put upon it and the superlative results which he has primarily inspired. 1934 CONGRESSIONAL RECORD— SENATE 449 Mr. COPELAND. Mr. President, of course. I am very grateful to my colleague for his kind words, but I shall not be outdone by him. I wish to say that if there had been any holding back on the part of my colleagues on the sub- committee, it would not have been possible to make such progress as we have made ; and I wish to return my thanks to the Senator from Michigan and the Senator from Iowa for the very energetic and intelligent assistance they have given. I would not wish to close this preliminary statement with- out referring to the fact that the President of the United States is tremendously interested in what we are attempting to do. No later than this morning he has told me of his desire to have adopted a program which will make safer the citizens of America. There is not a mother in this country who is not alarmed over the possibility of kidnaping in her family; and, in that connection, I may say that there is not a family in America safe against the menace of kidnaping. I shall speak of one other person, one of the secretaries of the President, Col. Louis Howe, who has been interested in this subject for many years, and who has given the chairman of the committee much wise advice. He brought to my at- tention the names of a good many persons who were known to him to be interested in this problem. The bar associations, not alone of my city but of many other cities, have had their attention focused upon this matter; the American Bar Association also is interested in It, and let me say to my colleagues in the Senate that if they could have had the personal experiences during the past 6 months that we have had, they would be restless and sleepless until they should have found some way of dealing with criminals. There are places in America where orderly government has disappeared, where the underworld is in control. I do not wish to indulge in any extravagant state- ment, but I am here to say that unless America shall be aroused the underworld gang.^ter will come more and more into control In the United States. I see In the Senate gallery now a man whom I mentioned a moment ago. the able Anaint&nt United States Attorney, Mr, Joseph B, Keenan, He went into the West, and through his efforts and by his aid the local offirlabt were able to bring to the bar of Justice and to w'ntencr, many desperate crimi- nal, some of the mcmi dangerous mm who have ever preyed upon Hocirty In America, If we have accomplished nothing eUe, I feel that we have succeeded In arousing some degree of public sentiment. Without public sentiment there cannot be such an admtnla- tratlon of criminal law as there must be If we are to be safe In our homes. In our persons, and In our property. Who are these criminals? One perhaps thinks about a crlmlrml as a man 35 or 40 or 45 years of age who, through a lifetime of crimiimlity. has developed a certain genius in the direction of the perpetration of crime and the carrying out of criminal plans. I assure Senators that If they think that to be the case they are greatly mistaken. I have been invited many times to go to the line-up at the police headquarters in New York City. I never did go. I hate crime and despise criminals, but it was demonstrated In the various hearings that it was necessary we should go to the very bottom of this evil. So while we were in Chicago the committee went to the line-up in the central head- quarters of the police department of that great city. We went at midnight and witnessed what I am about to describe. If Senators are unfamiliar with the " line-up ", so called, let them imagine a room with a long platform like a stage in a theater, a platform brightly illuminated. In front of this, in the auditorium, are the detectives. The arrested persons are required to march across the platform and stand there until their faces and figures are made familiar to the detec- tives and while the prisoners are walking across, their gait is studied. Mr. President, I was horrified to find In that line-up a great many persons, not one 25 years of age but all younger than that ; and over half of these men were out on probation or parolo. showing that at this youthful age they were already hardened criminals or repeaters in crime. I In the great prison at Sing Sins. In New York, 80 percent of the prisoners are under SO years of age and over half of them under 21. The average age of the criminals in Amer- ica is 23 3^ars; the largest age group is found at 19 years and the second largest age group at 18 years. Mr. HATFIELD. Mr. President Mr. COPELAND. I yield to the Senator from West Virginia. Mr. HATFIELD. Has the Senator's study carried him to the background of heredity and pathological and other basic factors that have resulted in these young men's develt^ing into criminals? Mr. COPELAND. I am glad the Senator from West Vlr- ginia asked the question, for he is a distinguished physician and a man of great experience, a thoughtful man. I may say that we have inquired, and at some time, either today or at another time, I shall present to the Senate what con- victions we have formed regarding the life history, the inheritance, and the traits of persons who are under convic- tion or who are charged with crime. In my (pinion, may I say to my friend from West Vir- ginia, one of the defects in the administration of criminal justice lies in the methods of sentencing men who have been found guilty of crime. Every person brought to the bar of justice and found guilty of a crime, particularly a crime of violence, should, after conviction and before sentence, be examined medically, mentally, physically, and psychologi- cally, lliere ought to be another body of equal dignity with the court to pass judgment on what shall be done with the convicted person after the conviction is established by the court. Tliat answers the question of the Senator, but today I shall not enlarge upon it. Mr. HATFIELD. Mr. President, I thoroughly concur In what the Senator says. In justice and humanity, that prin- ciple should be adopted and worked out. Mr. COPELAND. I thank the Senator. 2 am convinced that, in addition to the courta that pass judgment and de- termine the guilt of a prisoner, there should be another body of equal dignity to determine what shall be done with the victim after he shiUl have been found guilty of crime. I presume the Benator frcnn West Virginia concttft in that tUfgMtlon? Mr. HATFIELD. Z eoncur in it whole -hearUdly, Mr, Prefldent, Mr, COPELAHD. Mr. Prealdent, it U the youth who if the criminal. I cannot see why tvny fattier and mother in America ihould not be aroused over the danger, the men- ace, the poMibiUty of crime entering that particular house- hold. Education, Mr. President, is not enough to do away with the development of criminal Instincts. The most dangerous criminal often is the man who has the best education; his very education becomes an aid to him In the progress of his criminal career. The questions which have been asked divert me from the thought I had in mind. Nevertheless, it may not be inap- propriate now to say that, In my opinion, there is some- thing wrong with the church and the school and the home in America. I have no right to criticize the church, except my own church. I am critical of my own church in its failure to inculcate in the hearts of those who are asso- ciated directly or indirectly with it, those high motives which make not alone for spirituality but which make also for good citizenship. But I have no right to criticize other denominations. I do want to say. however, that In a notable book on Crime and the Criminal, written by Judge Marcus Kav- anagh. of Chicago, a man who was for many, many years upon the bench. I find a remarkable statement. In that book Judge Kavanagh said that when the churches are full the prisons are empty. He said that 1850 was the low- water mark of criminal activities in the country; that at that time with a population of 23,000,000 there were less than 7,000 prisoners in all the prisons of the country com- mitted there for major or minor offenses. I followed up this hint given by Judge Cavanaugh, thinking I should like Lxxvin- -29 ^T/-.-i-.T?ioc«TrkXT A T OTmr\T>T\ eTTMATT?. Tamttat?y 11 1934 CONGRESSIONAL RECORD— vSENATE 451 2%aA v« ^^ \^a^wjw%a « « already hardened criminals or repeaters in crime. Lxxvm 29 this hint given by Judge Cavanaugh, tjimkmg I should like CONGRESSIONAL :iECORD— SENATE 450 to find what happened later. I did not take the Agures of the last census because that was taken during the prohibi- tion era when there were many arrests, and I feared that we Jiglit get some misconception of the real contrasting figures: so I took 1910. Mr. SHEPPARD. Mr. President The PRESIDING OFFICER. Docs the Senator from New York yield to the Senator from Texas? Mr. COPELAND. Certainly. Mr SHEPPARD. May I give notice at this time that on next Tuesday, the 16th. I desire to address the Senate on the subject of the fourteenth anniversary of the eighteenth amendment Mr. COPELAND. Mr. President. I would not deprive my friend from Texas of that annual privilege which he has had. and I shaU be anxious to hear his speech to learn Just exactly how he feels in the light of recent events. Mr. SHEPPARD, I thank my friend from New York. Mr. COPELAND. In 1850. in the United States the tota number of prisoners in all the institutions was 6.637. This means that for every 100.000 population there were in jail at that time 29 prisoners. Instead of taking the figures during the prohibition period I took the figures, as I said of 1910 The population then had increased from 23.000.00( to a little less than 92.000.000. The total number of pris oners in 1910 in all our jails was 111.498. This represent: 121 prisoners for every 100,000 population. I know how difBcult it is to compare census figures of on( decade with those of another, but from all the evidence 7 can obtain, crime is three times as prevalent today as i was in 1850. Senators may draw their own conclusions Judge Kavanagh said it is because the churches are not a active now as in olden times. I hope this statement will "- read by ministers and that we may have the comments other members of the clergy than those we have alrea had before our committee. I said I have no right to criticize the church except m own I do not know how to reach the home. I suppose th home would be reached through the church. I am not au authority on that subject by any means. , , , ^^ But the third factor of defect in our socUl life is th» school. Every citizen has a right to criticize the school ff he is so disposed. I am not disposed to be very critical. It would not be right for one who is a product of the public school. My entire education was obtained in the public schools— in the grammar school, in the high school, in the State normal college, and later in a State university mair- toined by public funds. I would be the last one in the world to find serious fault with the schools. As a matter of fact, the parents of America see fit to fann cut theh- children to school teachers. They depend upcti the school teachers to teach the youngsters, not only rea( - ing and writing, arithmetic and geography, history and English, and the languages but they leave the school teach- ers to instruct how to arrange the table, how to cook eggs. how to enter a room, and how to be properly introduce!. We give over to the school teachers of America the veiy manners of the children, and certainly instruction in mora There Is a great difference of opinion I find among ed cators as to what ought to be done about this subject On one of our visits to New York we had a 2-day hearing devoted to juvenile deUnquency. We had before us pr fessors. teachers, social workers, police agents, ministers. and many of those interested in the social life as well criminal administration. One witness said that morals and ethics cannot be taught January 11 by precept, that it can be done only by example. With t belief I have about the Ten Commandments and the Sermim on the Mount. I should disUke to feel that we could not teaih something by precept. We must find out whether or not the methods of educatum should be redefined. Are we setting up the proper objectl^|es in education? Are we seeking simply to crowd the lit brains of our children with information and failing to ua- press upon them that the real objecUves of school are la volved in leading the pupils in the way of becoming good parents and good citizens? We have now assisting the committee of the Senate a group of educators. At a later time the committee will present to the Senate the suggestions made by these great leaders of educational thousht in America as to what may be done through the public schools, through the colleges, and the universities to do away with the development of the criminal instinct. My purpose now is merely to suggest that we have in mind this aspect of the case. Of course, our primary object was to find out how we could stop crime, how we could stop criminals. Our spe- cific instruction was to deal with two aspects of crime— the so-called " racket " and kidnaping. I desire to speak first about the rackets, the racketeering, the protective business rackets, the levy of tribute upon society. In this connection I will discuss the economic cost of crime. Have you any idea how much crime costs America? I am about to give you. very briefiy. an outline representing the views of a writer who had investigated this subject as to the cost of crime. If I am not diverted from my thought. I shall make a comment upon the figures. These figures were printed in the Manufacturers' Record 2 or 3 years ago. and I desire to give you a summary of these figures as to the cost of crime. First. Losses through frauds, including fraudulent securi- ties: We do not have to be reminded in the Congress about the loss to the American people through fraudulent securities. The Banking and Currency Committee has been in session for the past year. It has brought out facts which show a most outrageous state of affairs in the financial world as to fraudulent securities— securities put out under pretense of great worth when they are actually worth nothing. So included in this first category are losses through frauds, in- cluding fraudulent securities, embezzlements, forgeries, worthless checks, and fraudulent bankruptcies, amounting to $1,270.000,000— over a biUion and a quarter doUars every year. Second. Property losses through burglarly and robbery: I might say to the Senate that I was on the way over to Chicago for our hearing there I stayed overnight in Erie. Pa., and in the morning my trousers and $400 had disap- peared. I thought it was outrageously mean. The Senator from Arkansas tMr. Robinson] wants to know how I hap- pened to have so much money. I was going to the Fair as well as to this committee meeting, and knowing the prices they charged over there. I thought it would be necessary for my party to have at least that much money. But these criminals robbed the Chairman of the Committee on Crime of his trousers and $400! I was interested to find, as I shall bring out later, that the average loss from each individual crime is considerably larger than $400. I want my leader to know that I really got off easily. To revert to the subject in hand, I continue reading this classification: Second. Property losses through burglary, robbery, trans- portation thefts, thefts from warehouses and the mails, and the economic value of 12.500 murdered persons total $1,160,- 000 000 every year. The average number of murders in the United States per year is 12.500. so we have in this second category an annual loss of $1,160,000,000. Third Cost of law enforcement, including police and prison budgets, and cost of criminal justice and legal expenditures total $4,000,000,000. Fourth. The waste of crime. That is another most impor- tant item. This includes 500,000 extra policemen— that is, poUcemen not engaged in trafiBc regulation but who are directly employed in the apprehension of criminals and the prevention of crime— private detectives and private patrol- men, about 500.000. Then there are 2,000.000 crimes per year at $1,500 each. These figures are ascertainable from the indemmty com- panies insurance companies, and so forth. There are 2,000,000 1934 CONGRESSIONAL RECORD— SENATE 451 robberies, crimes, and so forth, with an average loss of $1,500, each year. Also, the expense of commercialized vice, the drug traffic, the liquor traffic, and the economic value of their victims. The figures in this category total the enormous sum of $6,503,000,000. According to this record then, the annual cost of crime in the United States reaches the staggering amount of $12,933,000,000. I believe these figures are dependable. Even though they did not amount to half this, the sum would be staggering; but if they do reach 13 billions, with our annual income reduced now to about 50 billions, it means that 25 cents of every dollar earned in the United States is the amount levied to pay the cost of crime. This is 10 times as great as the combined cost of maintaining the Army and the Navy. It is four times as much as the cost of maintenance of the Federal Government. It represents a sum sufficient to pay every dollar of Federal. State, and local taxation. It repre- sents, as I have said, an amount equal to one fourth of the annual national income. In short, one dollar out of every four we spend is our contribution to the cost of crime. If we had no other reason than the economic loss, we would be anxious to do what we could to prevent such a waste. I desire now to speak briefly about the so-called " rackets." A friend of mine in New York owned a store and decided that he would use it for the sale of automobile accessories. To this end he put a magnificent plate-glass front in his store, really a showcase. When he unveiled it a young man entered his store and said, " You have a beautiful plate-glass front. You should join the Plate Glass Protective Asso- ciation." My friend said, " What is that? " He said. " We patrol the streets and guard the property of our members." " How much does it cost? " " Fifteen dollars a week." My friend said, " Why, I cannot pay $15 a week to have my plate glass protected. I will depend upon the insurance companies." "All right." said the walking delegate. He left the store; and the next morning my friend came down and found his plate glass smashed. He collected his insurance, replaced it, and had the same experience over again; and then he could not get any more insurance. Then what did he do? He paid tribute of $15 a week to this scallawag organization in order that he might do busi- ness and preserve his property and display his goods in this plate-glass showcase. That is a local racket. I am not bringing it to you with any idea that that can be prevented or controlled or regu- lated by any sort of Federal legi.slation. I could name you 150 such rackets, including the laundry racket. If you have a hotel, a man comes in and says, " We want to do your laundry." " We do not want to change. We are satisfied." "All right." The next time the laundry goes out, with these magnificent linen sheets and pillow- cases, and towels, and so forth, they put acid on the linen and destroy it, and ultimately force the hotel man to hire that particular laundry. There are 150 of such rackets, local rackets. As a matter of fact, most crime is local, and most of it must be con- trolled by local forces — by the police and the judges and the prosecuting attorneys, and so forth, of the locality. Mr. FESS. Mr. President, will the Senator yield?* Mr. COPELAND. I yield. Mr. FESS. I was wondering how it would be possible for Federal legislation to correct these evils so long as the public will permit it. Mr. COPELAND. Federal legislation cannot correct these evils so long as business men pay tribute, until courage is put in the hearts of citizens of the United States, and they say, " We will not tolerate this evil." Mr. FESS. As effective as a penalty might be, there is not any such effective penalty as the condemnation of the public if the public should become aroused. Mr. COPELAND. Right; and not until the public is aroused locally, so that the police do their duty and the judges do their duty and the Jurors do their duty, can we expect to have these nasty, wicked crimes prevented. Mr. FESS. The Senator from New York deserves the gratitude of the coimtry for making an exposition of such a thing as this as one of the aids to better pubhc opinion. Mr. COPELAND. I thank the Senator. The highest tribute we have had came from Mr. Keenan. who said that there has been such an arousing of public sentiment that jurors do their duty. Until we build up character and cour- age and respect for what citizenship means, we cannot expect to do away with or contrcd crime. I am not using all these words to convince Senators that I believe it is possible to do away with crime. I know that crime will exist and that there will be criminals until the end of time. Crime started back in the Garden of Eden, and I suppose will be here when the millennium comes. But we can do a lot to stop it; and If we do not stop it orderly government will break down and the underworld will take possession, as it has done in many places, as I stated a few moments ago. Mr. VANDENBERG. Mr. President The PRESIDING OFFICER (Mr. OlifAHONET in the chair). Does the Senator from New York yield to the Senator from Michigan? Mr. COPELAND. I yield. Mr. VANDENBERG. I am sure the Senator would not want to be misunderstood in respect to one statement which he recently made, namely, that crime is essentially local. Mr. COPELAND. Oh, no. Mr. VANDENBERG. Of eourse, it is local in its incep- tion; but in this automotive age it has become so nonlocal and so interstate in character that the very lack of a local- ized entity is the reason for the committee's work. Mr. COPELAND. I hope I have not been misunderstood. I insist that the great majority of the crimes which I have included in this list are local, and should be dealt with as such. But. beyond that, as the Senator from Michigan has so well said, in this day of hard-surfaced roads, high-pow- ered automobiles, and airplanes, and with the aid of the telegraph and the telephone and the radio, there are few crimes of organized groups which are not interstate in nature. Of course, we are going to speak about that in cormection with the bills which we will present. Mr. VANDENBERG. Mr. President, if the Senator will yield further, he will recall the most vivid example we had of the demonstration of this new interstate character of crime in the testimony of the very able Assistant Attorney Greneral. Mr. Keenan, who had Just returned from his Okla- homa prosecution of the Oklahoma kidnapers. Mr. COPELAND. Successful prosecution. Mr. VANDENBERG. Successful prosecution, and a very brilliant prosecution. He brought to our notice the fact that while the kidnaping occurred In Oklahoma, the money passed in Minnesota, the hide-out was in Texas, and some of the chief arrests were in Ohio. Obviously it would be impossible to control that type of crime through mere local activity. Mr. COPELAND. The Senator is entirely correct. Before I leave the subject of the rackets I want to give one example of a racket which is not intrastate but is a crime involving interstate activity, and which may properly be considered here, and in the control of which we have prepared bills which will be useful. I refer to the poultry racket. There is in my city of New York a very large Jewish and Italian population- With those people there is a demand for live poultry. A housewife goes to the poultry market and selects the bird and has it killed in her presence. That industry is so great that it amounts to about $200,000,000 a year in New York City, so it can be seen that it is a tre- mendous business. The poultry comes from the West, from Missouri. Arkan- sas. Nebraska. Wisconsin, Illinois, Indiana, and from various southern States. Senators will remember that the geog- raphy of New York City is such that the city itself lies on a ASQ rn\TnT?T?QSTmM A T PT^rOPn SFISJATF. Janttary 11 1934 CONGRESSIONAL RECORD— SENATE 453 press upon them tnac me reai oojecuvca m s>»^w«* ~v .i* 452 CONGRESSIONAL narrow island, with no freight railroad reaching the island except the New York Central, which comes down the river from Albany. All the other railroads, like the Erie, the Pennsylvania, the Baltimore Si Ohio, the Delaware it Hudson, the Lackawanna, the Lehigh, and others, unload their freight in Jersey C;ty. In Jersey City, which of course is in New Jersey, across the river from New York, thfere are poultry terminals. The poultry is broupht from the West in special cars, "Pullman j)alace cars" for poultry. When the poultry is imloaded from the cars in Jersey City; the birds are put into wooden coops, each coop holding about 20 birds. Those coops, which are very cheap affairs. I suppose can be made for $2. They are loaded on trucks, the trucks are taken across on the ferry to the West Washington Market, or some other market, and there they are imloaded. In order to get those birds from the car they have tc be put into coops, which are rented from a concern having a monopoly, and $1 per trip is charged for them. In order to fill the coop, two men are employed, and then tc lift the coop from the platform to the truck, two other mer are employed, and the truck must be one which is owned bj the monopoly controlling the transportation of live poultry After the poultry gets across the ferry, two men must bi employed to lift the coop off the truck to the sidewalk. It costs $321 for the 5 days consumed in the transporta tion of a carload of poultry from Iowa to Jersey City. H costs $387 to unload that poultry in Jersey City and deliver i from Jersey City over to New York, which operation takes i hours. The cost of the transaction has been more thar doubled by reason of the excessive charges made througl these methods demanded in the handling of poultry in th< terminal. If they do not hire the right truck and use th( right coops the poultry will never reach its destination ir salable condition. The poultry racket has become one of the most outrageously dishonest and corrupt and vile industries known to the criminal world. It is not so true now, but it used to be a common thinj for someone to be killed, and that still happens occasionally The poultry racket has resulted in the loss of many lives One of the men interested told me once that the poultrj business is dishonest from the time the egg is stolen froir under the hen to the time the cook takes a little white meat off the wing. It is an outrageous procedxire, which costs the consumers of America himdreds of thousands of dollar: every year. That is an interstate racket, and we hope w< have foimd a way to control it. Mr. MURPHY. Mr. President, will the Senator yiel^ to me? Mr. COPELAND. I yield. Mr. JtfURPHY. The Senator will recall, in connectio^ with his statement of there being a racket in New York. that no charge is made as to the existence of any suca racket in Chicago, where the underworld has been imsuc cessful in racketeering the poultry business, owing to th refusal of the men engaged in the business to accede t the demands of the racketeers seeking control of the laboi unions; making it evident that it is something which can easily be corrected by law. Mr. COPELAND. Mr. President, my colleague on th ; committee, the Senator from Iowa, is correct, and I thinl: that his personal efforts In Chicago, through his activities upon this committee, have resulted in a correction of many of the evils which did exist in the poultry industry in tha ; city. In connection with the poultry industry, I will presen; the first bill framed by the committee, which is a bill to amend the Packers and Stockyards Act. We ask that thi> particular biD be referred to the Committee on Agricultun ; and Forestry, Its purpose is to place under the jurisdiction of the Department of Agriculture the poultry industry in th^ same manner in which the industry having to do wit cattle and other livestock is placed under that Departmen The industry interested in sheep, hogs, goats, and all so of #nifnikL« used for meat, is regulated under the Stocksrar Act. If we can amend that act. and include poultry, the: RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 453 will be the same supervision over the terminal charges rela- tive to poultry that is now exercised in relation to livestock. One of the very common practices found in every large seaport is operated through practically the same methods that I have descriljed in connection with poultry, except that more violence is used. When goods are shipped in from abroad, and are upon the docks of the various seaboards, the same demands are made in the way of excessive charges and the use of monopolistic features that we find in con- nection with the poultry business. So we also present a bill which seeks to protect trade and commerce against inter- ference by violence, threats, coercion, or intimidation. This bill is presented for reference to the Committee on the Judiciary. Likewise, we have a bill to amend an act which heretofore has related only to foreign commerce, exportation, so as to include interstate commerce, transportation between the States, in which we seek to enlarge the powers of existing law sufficiently to give protection against such methods as I have described. This bill is presented for reference to the Committee on the Judiciary. It has been found in cases involving extortion, as in kid- naping cases, that the telephone, the telegraph, the radio, and other means may be used for sending messages, which in many cases would make the crime an interstate crime, and therefore subject to Federal control. Therefore the bill just referred to should be referred to the Committee on the Judiciary. Before we come to the subject of kidnaping, I desire to speak of two other matters which have to do with property rather than persons; and I speak now of a bill which we are presenting which is not new to the Senate. It is new in this form, but has been introduced in the Senate heretofore. This is a bill providing for punishment where securities are stolen and transported in interstate commerce or foreign commerce. Likewise, we recommend that the provisions of the National Motor Vehicle Theft Act shall relate to other prop- erty than automobiles. We realize the difficulty of adminis- tration of this act. so we are seeking to aid the Department of Justice to some extent by providing that the amount in- volved shall be $1,000 or more, the provision of the bill being: Whoever shall transport or cause to be transported in Inter- state or foreign commerce any goods, wares, or merchandise of the value of 91.000 or more, knowing the same to have been stolen, shall be punished by a fine of not more than $10,000 or by im- prisonment of not more than 10 years, or both. Senators will recall that in the Dyer Act there is this pro- vision for protection as against stolen automobiles; but it is the feeling of the committee that the provision should be ex- tended to securities and other property as well. Mr. VANDENBERG. Mr. President The PRESIDING OFFICER. Does the Senator from New York yield to the Senator from Michigan? Mr. COPELAND. I yield. Mr. VANDENBERG. Referring to the last bill which the i Senator from New York has mentioned, it would further il- I luminate the record if I were to state that in most instances in the Midwestern States where we have had bank rob- j beries the stolen property has ultimately shown up, usually I in Chicago or some other metropolitan city. The only pos- : sible way in which the Federal Government could take any I share of jurisdiction in respect to the pursuit of the crimi- i nal or in the punishment of the crime, other than the au- thority given them under the Dyer Act with respect to the automobile of the robber if it happ>ened to be stolen, is through some such legislation as that which is here proposed, which brings that robbery within the interstate authority of the Federal Government through pursuit by the Federal Government of the stolen securities. I think the net result is tremendously to strengthen the hands of the local authori- ties with respect to bank robberies. Mr. COPELAND. I thank the Senator; and in this con- nection I should like to present for inclusion in the Record a memorandum prepared by the Department of Justice re- lating to the proi)osed antiracketeering bills which we have presented. The PRESIDING OFFICER. Without objection, it is so ordered. The memorandum referred to is as follows: ICniORANDnM REGARDING PROPOSED ANTIRACKETEERING STATUTK The accompanying draft of the proposed Federal antiracketeer- ing statute is designed to extend Federal Jurisdiction sufficiently to permit prosecution of so-called " racketeers " for acts constituting racketeering. In the past such persons have been prosecuted in the Federal courts for incidental violations of law, such as mail frauds or Income-tax evasions. The nearest approach to prosecution of racketeers as such has been under the Sherman Antitrust Act. This act, however, was designed primarily to prevent and punish capitalistic combinations and monopolies, and because of the many limitations engrafted upon the act by interpretations of the courts the act Is not well suited for prosecution of persons who commit acts of violence, intimidation, and extortion. Further- more, the Sherman Act requires proof of a conspiracy, combina- tion, or monopoly, and it is often difficult to prove that the acts of raer to make them felonies, punishable by imprisonment for not less than 1 year and for as long as the court in its discretion shall determine, and In addition by a line at least commensurate with the amount of the unlawful gain. In one racketeering case prosecuted under criminal provi- sions of the Sherman Act the unlawful gain was estimated to exceed $10,000,000 per year, but the fine was limited by the act to $5,000 for each person convicted Under such circumstances it might be said that crime does pmy. The penalty here suggested would cancel the benefits derived from the unlawful venture. Walter L. Rick, Special Assistant to the Attorney General. Mr. COPELAND. Besides the bills which I have men- tioned, we have several which relate to kidnaping. Kidnaping is in many ways the most terrible of crimes, in my opinion. It does not seem possible that any human being could conspire with others to seize a perfectly inno- cent person and carry that person away with a view to extorting money from the family. Of course, all these forms of rackets, as a matter of fact, are not new. We can see today the ruins of the castles on the Rhine and on the Danube where lived the robber barons who collected tribute of this character. Likewise in the East the camel caravans, loaded witli spices and other valu- ables from the East, were levied upon in the past. There are classical instances of kidnaping, but kidnaping is becoming all too prevalent in the United States. It is our desire to present for the consideration of the Senate bills which will be helpful in controlling this crime. To this end we present a bill prohibiting the transpor- tation of kidnaped persons in interstate commerce, and amending the act to include certain language which I will read. We find, from the evidence adduced before the sub- committee, that there are many appeals made to the police to find persons thought to be kidnaped, or at least to find some means for the return of such persons. Of course, there is always a. question as to whether the crime is an interstate crime; whether or not a State line has been crossed in any manner, either by the transportation of the victim or by a message sent by radio or telegraph or otherwise. A person disappears and the question is. Has he been kidnaped? Many times it is ultimately determined that the victim was actually kidnaped and taken across the State line, as stated by the Senator from Michigan, and as was done in connection with a notable case. It happens then that the Division of Investigation is called in when the clues are cold, when there is no opportunity to study the case at first hand. So the committee has seen fit to recommend an amendment to the so-called " Lindbergh Uw " providing — That in the absence of the return of the person at persons so unlawfully seized • • • for or during a period of 3 days. It shall be presumed that such person or persons have been trans- ported In Interstate or foreign commerce • • •. That gives an opportunity for the Federal Government to go in early, not to interfere with the local authorities but to get all the evidence at first hand as early as possible, on the presumption that if the missing person has been gone 3 days he has been transported in interstate commerce. I should not desire to tire the Senate with any extensive observations relative to these bills, because they are sure to have hearings before the committee, and there will be abundant opportunity to rx>nslder their merits or demerits. Mr. President, we come to the question of dealing with the criminal. One of the most difficult tasks that the pros- ecutor has in connection with crimes of violence relates to the disappearance of the witnesses. Many a police force^ to use the language of that professon — has " worked up " a good case; the evidence seems complete; the prosecutor is hopeful of conviction; and then he finds that his witnesses have disappeared. The problem of the fugitive wltnes^ is one of the great problems in the administration of criminal law. That is particularly true of a city like mine where. I might say, we have a 5-cent fare across to Hoboken or over to New Jersey. The witness disappears; he goes into another State; he is sent there either by fear or by a bribe. It is a difficulty that has confronted the prosecutor of Wajme County, in Michigan, where witnesses have disappeared and gone over into Ohio. What can t>e done about that? There is no power in the Government to return a witness to a crime. The principal may be extradited, but not the witness. If those of us who are here now. saw a murder committed in the District of Columbia — and perhaps there are those here who would like to have a murder committed [laughter] — were to go across the line into Virginia there is no way in the world that we as witnesses could be brought back. We have here a bill making it a felony for a witness to a crime to flee to another State. My very old friend and colleague the Senator from Michi- gan [Mr. VANDENBERG] thinks he sees in this an opportunity to help the State courts. We have an agreement in the committee that these bills shall be presented jointly where we are all agreed that they should be so presented; and this one is so presented, but I do not share the optimism of my friend from Michigan as to what can be done under it. He hopes that a witness to a crime against the State law may. by the operation of this proposed law. be brought back by the United States district court, and then, when the wit- ness is returned and within the jurisdiction of the State court, that he may be turned over to the State court for the benefit of the State authorities in carrying on the prosecu- tion. Of course. I do not think that can be done, but never- theless Mr. VANDENBERG. Mr. President, 'will the Senator yield? Mr. COPELAND. I yield. Mr. VANDENBERG. Whether the theory of the Senator from New York be a sound one or not, he will agree that undoubtedly there will be infinitely fewer fugitive witnesses as a result of the existence of this proposed -statute. Mr. COPELAND. There is no doubt abotft that. Mr. VANDENBERG. And I remind the Senator that the prosecuting attorney of Detroit and Wasme Coimty testified that, in his judgment, the mere existence of such a statute as this will probably solve 90 percent of his prosecuting difficulties; and if the final 10 percent cannot be overtaken because of the adverse argument the Senator has indicated, nevertheless the correction of 90 percent of the fugitive- witness and the fugitive-defendant difficulties in Detroit will be a stupendous contribution to the public welfare. Mr. COPELAND. Mr. President. I think the Senator from Michigan is entirely correct. When it is known that to flee the State is a felony under the Federal law, one whose pres- 454 CONGRESSIONAL I. ence is desired by the State court will hesiUte to go away So it will do great good: I have no doubt about it. I hop€ it may ultimately be found to be effective with reference tc the other 10 percent of the cases. The bUl I present for reference to the Committee on th< Judiciary makes it unlawful for any person to flee from on< State to another for the purpose of avoiding prosecution or the giving of testimony in certain cases. Mr. WALSH. Mr. President Mr. COPELAND. I yield to the Senator from Massa chusetts. Mr. WALSH. I have not had an opportunity to hear a^ the Senator has been saying. I assume he has been discuss- ing some of the evidence presented before the special com- mittee of which he ha? been chairman and to which hit devoted so much time during the recess? Mr. COPELAND. The Senator is correct. Mr. WALSH. I should like to hear the Senator discuss the conclusions, if any. which the committee reached upon what seems to me to be a very serious aspect of the whol; question of crime prevention. Many people are of the opin - ion— and I am one of :hem— that the courts fail to deal sufficiently harsh— I think we all agree that they do no; deal promptly— with crimes growing out of acts of violence . I should like to have tl-e Senator inform us what recom- mendations he proposes to make which will tend to awaken the courts to a realizatioi that the leniency displayed in th? past when defendants h.ive been brought before them an i found guilty of serious acts of violence is not always wel directed. Dees the Senator comprehend my question? Mr. COPELAND. I do Mr. WALSH. Let me say to him. as an illustration, that within a few days my r.ttention has been called to thre? cases in the District of Columbia of a very serious charactei . One was a case where a woman's throat was slashed by i man engaged In robbing a store: another was a case where i bandit used a gun and shot and wounded two policcmer . My recollection is that tlie penalty imposed was somethin i less than a sentence of 2 years in each case. I must say that I think a contributing factor to the spread of crime, par- ticularly crimes where force is employed, is the lenience manifested by our courts in dealing with that class of criminals. Mr. COPELAND. I thank the Senator from Massachu- setts. Anything he suggests comes from a ripe experience and sound judgment. Of course there must be celerity and certainty. There must bii certainty of apprehension of the criminal and celerity in dealing with him. England has a great advantage over us in speed of action. When it comes to the question of punishment there aie two schools of thought. There is the one school believirg that the punishment shouM suit the crime, that there shoul d be great severity in dealing with the criminal. Mr. WAUSH. The Senator will keep in mind that I a;n Inquiring only about the lise of dangerous weapons. Mr. COPELAND. Yes. In a few moments I shall pri(- sent the last bill which the Department of Justice regards as the key bill in the coiitrol of firearms. But the Senati )r has asked a question which I desire to answer more fuUy. Personally — and I speak only for myself and not for the committee in this— I do not beUeve that punishment 3f crime is a deterrent. It will be recalled that years ago n England they had a long list of crimes where death wis the penalty— more than 100. my friend the Senator from Utah [Mr. King] informs me sotto voce. Among oth;r crimes the picking of pockets was punishable by death. In order to make this law effective and to give warning to i .11 pickpockets that it meant death if they picked pockets. th!y had public executions where everybody could come and s;e the pickpockets killed. They had to give it up because the re were too many pockets picked at those public executioi5. and they had to proceed to some other method of dealing with pickpockets. [Laughter.] Of course that is an extrei^e case. , But Mr. Lawes, who Is the warden at Sing Sing prison ai id a popular writer on penology and a great student of the RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 455 subject, is thoroughly convinced that severity of the sen- tence does not prevent the commission of the particular crime so far as the remainder of society is concerned. Mr. WALSH. But it does deprive a dangerous character of the opportunity to repeat the crime. Mr. COPELAND. That is true, but the Senator was not here when I discussed this matter previously. I said, before his return from the committee where he was engaged, that in my judgment there ought to be another body to deal with the prisoner after he has been convicted, a body of equal dignity. Many of the convicted persons are abnor- mal. They are mentally defective. They are physically defective. They are dangerous and must be dealt with in a way to protect society. But when we find a man who has killed another, simply to execute him does not answer the purpose of society. It may, so far as he is concerned: but we ought to inquire, I think, about why he is antisocial in his nature, and so forth. Certainly there can be no doubt that when a man in possession of his normal mental processes, who has no excuse by reason of disease cr otherwise to fail to act as a rational person, is found to be the possessor of a gun which he does not hesitate to use, he mast be dealt with severely. I do not disagree with the Senator from Massachusetts about that. Mr. WALSH. Has the committee made any investigation of the sentences that have been imposed in the past in the class of cases to which v;e have made reference? Mr. COPELAND. The committee is now in process of studying the question. Mr. WALSH. I mentioned three cases called to my atten- tion in the District of Columbia — cases of highway robbery, where murder was attempted. Mr. COPELAND. In one of our hearings — and I will not mention the city — it was shocking to find how men who, from my standpoint, ought to be incarcerated for 150 years and v.ho were out of prison in 2 or 3 years. Sometimes on one pretense or another they utterly escaped any punish- ment whatever. I spoke about the line-up for police inspection, where half of them were found to be out on probation and parole. There is something utterly wrong with the administration of our laws with regard to probation and parole. When it comes to the question of sentence, that, of course, is open to debate, but certainly no judge is worthy of his high place upon the bench unless he carries out the spirit and intent of the law for the protection of society. Mr. WALSH. Does not the Senator believe that if an analysis of the cases were made public, it would have a very good effect in calling the attention of the courts to the desire on the part of the public for more severe sentences? Mr. COPELAND. No Senator in this body has been more diligent and patriotic than the Senator from Massachusetts in the matter of taking the public into his confidence. When we have an aroused public and when they know what is going on in the courts and in police affairs, there will not be this wishy-washy administration of justice. Mr. WALSH. I am glad the Senator feels that way about the matter. Mr. COPELAND. Mr. President, I desire to hurry on and get these bills before us. I ask the attention of the Senator from Massachusetts [Mr. Walsh], who is an able lawyer. I call attention to two bills I am about to mention. We find that many criminals, by the aid of willing acces- sories in the legal profession, find ways to evade final dispo- sition of the matter before the courts. One of them is by repeated application for wTits of habeas corpus. So we are presenting a bill which abolishes the right of appeal in all cases where a writ of habeas corpus has been granted to test the validity of a warrant of removal or the detention thereunder, and, after hearing upon the writ, the defend- ant has been remanded. In other words, we provide that he can have just one chance for habeas corpus; that he can- not keep it up for the rest of his life. Mr. McKELLAR. Mr. President. I desire to ask the Sen- ator a question, not about that particular matter, but in reference to the granting of paroles by Federal judges under the parole law that was passed some years ago. Mr. COPELAND. And which I introduced. Mr. McKELLAR. Yes; which the Senator from New York introduced. Did the committee take evidence on the subject of paroles, and did the committee find that that law was working well or ill? I will say to the Senator that so far as I have witnessed its working, it has rather been to the general benefit, in my judgment, of conditions of crime. I recall talking not long ago with one Federal judge who said that more than 90 percent of the men paroled had become good citizens there- after, and were still good citizens; and I am wondering what the evidence disclosed to the committee. Mr. COPELAND. I am very glad the Senator asked the question. I referred to the matter in the first part of my remarks. I should like to say, first, that I am a firm beUever in parole and probation as a general proposition: and, as the Senator has said, I did introduce some years ago the bill relating to the Federal courts. Frankness compels me to say that unless the machinery is provided and the funds voted for efficient application of the parole system it is a bad thing. We have a very able man in the Department of Justice — Mr. Sanford Bates. He is the Superintendent of Prisons, as I understand. Mr. WALSH. He is the Superintendent of Prisons. He was formerly police commissioner of Massachusetts. Mr. COPELAND. I regard Mr. Sanford Bates as a very able man. At a time when I was being somewhat shaken in my conviction regarding the value of probation and parole Mr. Bates appeared before our committee as a witness, and he pointed out this fact: He said. " Suppose a man's sentence Is 7 years. It does not matter about the crime: but suppose his sentence is 7 years, and he continues in prison for the full 7 years. He then returns to a cold world, where he has no welcome. He has no job; he has no place: and pretty soon he is rebuffed to the extent of becoming decidedly antisocial. No matter what he was before, he becomes a foe to society, because he is opposed by society." Mr. Bates pointed out how much better it is to take the man at the end of 4 years, we will say, and put him on parole, so that for 3 years he is under supervision. He is not fully restored to society. Unless he is a decent citizen he can be taken back to prison at any time. Mr. Bates said that in that 3 years there is a rehabilitation of the man both socially, and probably economically. That is right. I believe in that when there is proper application of the law, where there is supervision, and where there is money enough to have the agents, visitors, and so forth. But if we simply take the man out at the end of 4 years, with perhaps only a decent history of being a good prisoner; we take him out and turn him loose without any supervision, and we do not know what is going to become of him. If we are to have probation or parole at all, we must have the man under real supervision. That is the criticism I have to offer of the system as it is applied at present. Where there is actually that supervision after the man leaves prison until the end of his term, then it is a good thing, but otherwise it has no value. Mr. McKELLAR. He has to have a sponsor under the law. Mr. COPELAND. The Senator knows what that means. Mr. McKELLAR. Frequently that has a very real mean- ing. I think the parole system is, on the whole, beneficial to society. I really believe that. It ought to be admin- istered in accordance with the highest principles of justice, and I have no doubt that in most instances it is. Where it will make a better citizen out of a criminal, necessarily it is a good thing. Mr. COPELAND. I want to repeat what I said, that I believe in it, but unless there are appropriations to build up the machinery for care and supervision of the man when he comes from prison, the whole system breaks down. Mr. WALSH. Is not that the general practice? It is in my State. Mr. COPELAND. It is the general practice, perhaps, in most States, so far as the cities are concerned. In the rural sections there is not the same application of the laws which relate to criminal jurisprudence. The next bill has to do also with the care of the man after he has been captured, and it relates to the abuse of the alibi. The last resort of a lawyer defending a case is to offer an alibi, to attempt to prove that the client was not at the scene of the crime at all, and he springs the alibi proposal at the time when the prosecutor has no oppor- tunity to investigate it. Perhaps the proper decision is not made in the case because of the inabiUty of the prosecutor to break down the alibi. So we propose that the defense of an alibi shall not be interposed in the prosecution of any criminal case in any court of the United States unless notice of an intention to interpose such defense is given and entered on record in the case at the time the man is arraigned for trial. When the case is prepared the lawyer of the defendant says, " I am going to interpose an ahbi." Then the prosecutor will have an opportunity to investigate the merit of the defense and find out where the man actually was at the time of the commission of the crime. Another bill which we have been asked by the Depart- ment of Justice to present is one providing that the testi- mony of any defendant given under authority of this act shall be given before any other testimony for the defense is heard by the court trying the case. If a defendant is going on the stand in his own defense, he must first give his own testimony, and in any such trial or proceeding the husband or wife shall be competent but not compellable to testify for or against the other, but neither shall be com- petent to testify as to any confidential communications made by one to the other during marriage. Another bill is one to authorize the consohdation of the investigative agencies of the Government. I will not speak at any length about that now. but the question arises as to whether or not it may not be wise to consolidate the various divisions and bureaus having the duty of investigating activities of one sort or another in customs and post-office frauds and that sort of thing. Mr. McKELLAR. In other words, the secret service of the Treasury Department, the Post Office Department, and the Department of Justice are all to be consolidated. Is that the purpose? Mr. COPELAND. Let me read it: That the President is hereby authorized, by Kxecutlve order or orders, to transfer the whole or any part of any or all executive agencies engaged in Investigating vlolatlonB of any laws of Um United States— And so forth. I have no convictions as to how far it is to go, and I say that now because I know there will be a flood of protests from many who are happy in the particular locations where they are at present. I want to say this, in that regard. that there will be a hearing to bring out whether or not the plan is wise, and how far it should go. Mr. McKELLAR. Before the Senator leaves that, are we to build up a Russian cheka in this coimtry? We are getting to have a tremendous secret -service organization, or perhaps I should say organizations. I am not so sure about the value of these secret-service organizations. I think they are fre- quently used as a means of doing great wrong, and I have my doubts about secret -service systems in a republican form of government Uke ours. I have been astounded at the tremendous growth and the use of large sums of money for the " secret service ", as it is called, of the Department of Justice. I am Just wondering whether the Senator is giving his approval, or will he, aft.er this investigation, advise the Senate to give its approval, to a larger and a stronger system of secret service in our Government. Mr. COPELAND. Mr. President, the Senator has asked a question, and I must answer it in all frankness. 456 CONGRESSIONAL ■i « RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 457 We have a bill dealing with that subject, which I do net bring to the attention of the Senate today because the sul - committee has not had an opportunity to study it. But I think I may say that we are agreed that ttiis bureau spoke n of by the Senator should be enlarged. I know what evils have crept into the system in the past, and I want to avoid them so far as possible, but the Senator would be amazed, perhaps, to hear the responses to a ques- tionnaire which I sent out to the 48 Governors of the Stat( ss of this Union. I asked nve questions. I will not give thei n in detail, but in effect. I asked. "Do you believe that t would be advantageous to have the Federal Government cooperate more closely with the States in the administratic n of criminal justice so far as those matters are concerned which might possibly have an interstate significance? " I asked a similar question looking to what I called an Amer - can Scotland Yard, using the term in an Oppenheim sense. a legendary sense, because, as a matter of fact. I say in all truth that I believe that the Division of Investigation of tt le Department of Justice in the Federal Govermnent of ttie United States is unsurpassed in this world as an investiga- tive body and an institution for running down criminal activities. That is my testimony, and at some other time I am going t-o enlarge on it. Mr. McKELLAR. It was alleged in the newspapers iit one time that this secret service body of the Department of Justice investigated and rifled certain Senators' offic;s here in the Capitol. The Senator does not approve of that, I know. Mr. COPELAND. I certainly do not approve of it. aid I have some very profound convictions about certain per- sonnel which I will discuss in private with the Senatot. But honestly administered and capably administered, tms Division of Investigation can be made a more powerfiil agency for good in its field than any other arrangement that could be suggested. That is my opinion. As I have said, I am speaking now for myself. I want to have an enlargement of this bodj' and would have the Go emor of each State recommend to the Attorney General t persons regarded by the Governor as suitable to be membe of this Division of Investigation, nominated, just as we no nate men to enter West Point. Then these candidates of t Governors will be examined by the Department of Justice see Txhether tliey are worthy and well qualified. If they ait, they will be made members of the Division of Investigatio i, given the training which we give all of our men — and I wai it to say that it is good training — and then paid, because thiy are Federal olBcials. from fvmds appropriated for the Divi- sion of Investigation. They will then be assigned to tlie particular State from which they have come. The response has been amazing. I expected to have pro- tests from many States where there was a firm conviction )f State rights, such as Cormecticut, my neighboring State, which is one of the strongest State-rights States in tjie Union. Out of 48 Governors, 36 have responded, and 34 pf them are in favor of the plan. Almost every Southern State approved of it. What would these two men from the Senator's State d^? Every State, no matter how rural may be its population how wide its expanse, is entitled to give the very best it c in the way of protection against the criminal. In my nati State the sheriff of the average rural county is selected because he knows anything about police methods or t apprehension of criminals but because he is a popular m He is made the sheriff. He is the chief peace ofQcer. happens many times in my State in a rural county that the citizen is given almost no protection, not because of any unwillingness on the part of the sheriff but because of lis lack of knowledge of the way how to proceed in the appr^ hension of a criminal. Mr. WALSH. Mr. President, does the Senator's State haj^e a State constabulary? Mr. ne and all territory and waters, con- tinental or insular, subject to the Jurisdiction of the United States." The bill (S. 2248) to protect trade and commerce against interference by violence, threats, coercion, or intimidation, was read twice by its title, referred to the Committee on the Judiciary, and ordered to be printed In the Record, as follows: Be it enacted, etc.. That the term " trade and commerce ", as used herein, shall Include trade or commerce between any States, with foreign nations, in the District of Columbia, in any Territory of the United States, between any such Territory or the District of Columbia and any State or other Territory, and all other trade or commerce over which the United States has constitutional Juris- diction. Sec. 2. Any person who, in connection with or In relation to any act in any way or to any degree affecting, biirdening, hindering. 458 CONGRESSIONAI RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 459 rural districts? I Si Wesson, he cannot buy .44 cartridges. He must buy .38 mittee to have hearings, perhaps grouping the various pro- act in any way or to any degree affecting, burdening, hindering. li 1 458 CONGRESSIONAI RECORD— SENATE destroying, stifling, or diverting trade or commerce or any article or commodity moving or about to move In trade or commerce — (1) commiu or threatens to commit any act of violence. Intliri- datlon. or Injury to a person or property, or commits any act which la declared to be unlawful by the criminal laws of the State. dl»- trtct or Territory where the act Is committed; or (2) extorts or attempts to extort money or other valuable con- siderations; or (3) coerces or attempts to coerce any person, firm, association, or corporation to Join or not to Join an association, firm, corpon- tlon. or group, or to buy or rent commodities or services from par- ticular sources, persons, firms, or corporations, or to make pa|r- ments directly or Indirectly to any person, association, firm, ccr- poratlon. or group except for a bona fide consideration; or (4» coerces or attempts to coerce any person, firm, association, or corporation to do an act which such person, firm, assoclatlcn, or corporation has a legal right not to do, or to abstain from doing an act which such pyerson, firm, association, or corporation has a legal right to do — shall, upon conviction thereof, be guilty of a felony and shall je punlsh»d by Imprisonment from 1 to 99 years, and. In addltloi, by a fine which shall be at least commensurate with the amount of the unlawful gain. Sec. 3. Any person charged with violating this act may be pu i- Ished In any district In which any part of the offense has beiin conxmltted by him or his associates or his conspirators. The bill (S. 2249) applying the powers of the FederU Government, under the commerce clause of the Constitutio i, to extortion by means of telephone, telegraph, radio. orU message, or otherwise, was read twice by its title, referrid to the Committee on the Judiciary, and order to be printed in the Record, as follows: Be it enacted, etc.. That whoever, with Intent to extort from any person, firm, association, or corporation any money or other thing of value, shall transmit in interstate commerce, by tele- phone, telegraph, radio, or oral message, or by any other mea is whatsoever, any threat (1) to Injure the person, property, ar reputation of any person, or the reputation of a deceased person, or {2} to kidnap any person, or (3) to accuse any person of a crime, or (4» containing any demand or request for a ransom ;»r reward for the release of any kidnaped person, shall upon convl:- t.on be punished by Imprisonment for such term of years as tie court, In Its discretion, shall determine: Provided. That the term "interstate commerce" shall include communication from one State, Territory, or the District of Columbia to another Stale, Territory, or the District of Columbia. The bill (S. 2250) to punish the transportation of securi- ties in interstate or foreign commerce was read twice l»y its title, referred to the Committee on the Judiciary, aiid ordered to be printed in the Record, as follows: Be it enacted, etc.. That this act may be cited as the "Natloral Security Theft Act." Skc. 2. That when used In this act — (a) The term " security " means any note, stock. Treasury stock, bond, debenture, evidence of Indebtedness, certificate of inter* st or participation in any profit-sharing agreement, coUateral-tn; st cer;lflcate, preorganlzallon certificate or subscription, transferal le share. Investment contract, voting-trust certificate, certificate of Interest In property, tangible or intangible, or, in general, a ly Instrument commonly known as a security, or any certlflcales of Interest or participation In. temporary or interim certificate for. receipt for, or warrant or right to subscribe to or purchase, a ay of the foregoing. (b) The term ** Interstate or foreign commerce " as used In this act sbaU Include transportation from one State, Territory, or the District of Columbia to another State, Territory, or the D s- trlct of Coliunbla. or to a foreign country, or from a lorel jn country to any State, Territory, or the District of Columbia. S«c. 3. That whoever shall transport or cause to be transported in Interstate or foreign commerce any security, knowing the same to have been stolen, shall be punished by a fine of not more th in tlO.OOO. or by Imprisonment of not more than 10 years, or both, 8ic. 4. That whoever shall receive, conceal, store, barter. Bell, or dlspoee of any security, moving as, or which is a part 3f. or which constitutes Interstate or foreign commerce. knowl;ig the same to have been stolen, shall be punished by a fine of rot more than $10,000 or by Imprisonment of not more than 10 years, or both. Sec. 5. That any person violating this act may be punished in any district in or through which such security has been traiis- ported or removed by such offender. The bill (S. 2251) to extend the provisions of the Na- tional Motor Vehicle Theft Act to other stolen propeity was read twice by its title, referred to the Committee on t le Judiciary, and ordered to be printed in the Record, as follows: Be it enacted, etc.. That this act may be cited as the " I< a- tlonal Stolen Property Act." Skc. 2. The term " Interstate or foreign conxmerce " as used In thla 4ct ahaU include transportation from one State, Territory, or January 11 1934 CONGRESSIONAL RECORD— SENATE 459 the District of Columbia, to another State. Territory, or the Dis- trict of Columbia, or to a foreign country, or from a foreign coun- try to any State, Territory, or the District of Columbia. Sec. 3. That whoever shall transport or cause to be transported in interstate or foreign commerce any goods, wares, or merchan- dise of the value of $1,000 or more, knowing the same to have been stolen, shall be punished by a fine of not more than $10,000 or by Imprisonment of not more than 10 years, or both. Sec 4. That whoever shall receive, conceal, store, barter, sell, or dispose of any gcxxls, wares, or merchandise of the value of $1,000 or more, moving as, or which Is a part of, or which con- stitutes Interstate or foreign commerce, knowing the same to have been stolen, shall be punished by a fine of not more than $10,000 or by Imprisonment of not more than 10 years, or both. Sec. 5. That any person violating this act shall be punished in any district In or through which such goods, wares, or merchan- dise has been transported or removed by such offender. The bill (S. 2252) to amend the act forbidding the trans- portation of kidnaped persons in interstate commerce was read twice by its title, referred to the Committee on the Judicia»-y. and ordered to be printed in the Record, as foDows: Be it enacted, etc.. That the act of June 22. 1932 (U.S.C. ch. 271, title 18. sec. 408a), be, and the same is hereby, amended to read as follows: " Whoever shall knowingly transport or cause to be transported, or aid or abet in transporting. In Interstate or foreign commerce, any person who shall have been unlawfully seized, confined, in- veigled, decoyed, kidnaped, abducted, or carried away by any means whatsoever and held for ransom or reward or otherwise shall, upon conviction, be punished by Imprisonment in the peni- tentiary for such term of years as the court, in its discretion, shall determine: Provided, That the term 'interstate or foreign commerce ' shall include transportation from one State, Terri- tory, or the District of Columbia to another State, Territory, or the District of Columbia, or to a foreign country, or from a foreign country to any State, Territory, or the District of Colum- bia: Provided further. That If two or more persons enter into an agreement, confederation, or conspiracy to violate the provisions of the foregoing act and do any overt act toward carrying out such unlawful agreement, confederation, or conspiracy, such per- son or persons shall be punished In like manner as hereinbefore provided by this act: And provided further. That in the absence of the return of the person or persons so unlawfully seized, con- fined. Inveigled, decoyed, kidnaped, abducted, or carried away and the apprehension of the person or persons offending against the provisions of this act for or during a period of 3 days, It shall be presumed that such person or persons have been trans- ported in Interstate or foreign commerce, but such presumption shall not be conclusive." The bill (S. 2253) making it unlawful for any person to flee from one State to another for the purpose of avoiding prosecution or the giving of testimony in certain cases was read twice by its title, referred to the Committee on the Judiciary, and ordered to be printed in the Record, as fol- lows: Be it enacted, etc.. That It shall be unlawful for any person to flee from any State. Territory, or possession of the United States, or the District of Columbia, with Intent either (1) to avoid prosecution for a felony under the laws of the place from which he flees or (2) to avoid giving testimony in any criminal pro- ceedings In such place In which the commission of a felony Is charged. Any person who violates the provision of this act shall, upon conviction thereof, be punished by a fine of not more than $ or by imprisonment for not longer than , or by both such fine and Imprisonment. Violations of this act may be prose- cuted only In the Federal Judicial district in which the crime was committed. The bill (S. 2254) to amend section 1014 of the Revised Statutes of the United States was read twice by its title, referred to the Committee on the Judiciary, and ordered to be printed in the Record, as follow- s: Be it enacted, etc.. That section 1014 of the Revised Statutes of the United States, as amended (U.S.C, title 18, sec. 591), be amended by adding thereto the following sentence : *' The right of appeal is hereby abolished in all cases where a writ of habeas corpus has been granted to test the validity of a warrant of re- moval or the detention thereunder and. after hearing upon said WTit. the p>etltloner has been remanded to custody for removal on said warrant." The bill C8ed In the prosecution of any criminal case in any court of the United States unless notice of an intention to interpose such, defense is given and entered as of record in the case at or before the time defendant is arraigned for trial. The bill (8. 2256) to amend an act entitled "An act to make persons charged with crimes and offenses competent witnesses in United States and Territorial courts '*, approved March 16, 1878, was read twice by its title, referred to the Committee on the Judiciary, and ordered to be printed in the Record, as follows: Be it enacted, etc.. That the act entitled "An act to make per- aans charged with crimes and offenses competent witnesses in United States and Territorial courts ", approved March 16, 1878 (U.S.C.. title 28. sec. 632), be. and the same Is hereby, amended to read as follows: " In the trial of all indictments, informations, complaints, and other proceedings against persons charged with the commission of crimes, offenses, and misdemeanors, in the United States courts. Territorial courts, and court-martials and courts of inquiry in any State of Territory, including the District of Columbia, the person so charged shall, at his own request but not otherwise, be a com- petent witness: Provided, That the testimony of any defendant given under authority cjf this act shall be given before any other testimony for the defense is heard by the court trying the case. In any such trial or proceeding the husband or wife of the accused shall be competent but not compellable to testify for or against the other, but neither shall be competent to testify as to any (xinfidential communication made by one to the other during marriage." The bill (S. 2257) to authorize the consolidation of in- vestigative agencies, was read twice by its title, referred to the Committee on the Judiciary, and ordered to be printed in the Record, as follows: Be it enacted, etc.. That the President Is hereby authorized, by Elxecutive order or orders, to transfer the whole or any part of any or all Executive agencies engaged in Investigating violations of any laws of the United States, and /or the functions thereof to the Jurisdiction and control of the Division of Investigation of the Department of Justice. Such order or orders shall make provision for the transfer or other disposition of the records, property (including office equipment), and personnel of the agencies affected by such transfer and shall also make provision for the transfer of such unexi>ended balances of appropriations available for use in connection with the function of the agency transferred, as he deems necessary by reason of the transfer, for the use of the said Division of Investigation. Tlie bill (S. 2258) to regulate commerce in firearms was read twice by its title, referred to the Committee on Com- merce, and ordered to be printed in the Record, as follows: , Be it enacted, etc., That as used in this act — ( 1 ) The term " person " includes an individual, partnership, association, or corporation. (2) The term " Interstate or foreign commerce " means com- merce between any State, Territory, or possession, or the District of Columbia, and any place outside thereof; or between points within the same State, Territory, or possession, or the District of Columbia, but through any place outside thereof; or within any Territory or pos.sesslon or the District of Columbia. (3) The term "firearm" means a pistol, revolver, or any other firearm capable of being concealed on the person, a sawed-off shot- gun, a muffler or silencer, a blackjack or any weapon of similar nature, brass knuckles, by whatever name known, a tear-gas pistol or pencil, or anununition for any of said weapons. (4) The term "manufacturer" means any person engaged In the manufacture of firearms, and the term " licensed manufac- turer " means any such person licensed under the provisions of this act. (5) The term "dealer" means any person engaged in the busi- ness of selling firearms at retail, and the term " licensed dealer " means any such person licensed under the provisions of this act. Sec. 2. (a) It shall be unlawful for any person, except a manu- facturer having a license issued under the provisions of this act, to ship or cause to be shipped any firearms in Interstate or foreign commerce. (b) It shall be unlawful for any person to receive, conceal, store, barter, sell, or dispose of any firearm shipped in Interstate or foreign commerce In violation of subdivision (a) of this section, knowing such firearm to have been so shipped. (c) It shall be unlawful for any licensed manufacturer to ship any firearm In Interstate or foreign commerce to any individual other than a dealer, or for any such individual to receive any firearm so shipped, unless (1) the laws of the State in which such firearm Is made deliverable permit the sale of such firearms, and (2) such Individual files with the manufacture a sworn state- ment similar to that required under subdivision (d) hereof to be filed with the licensed dealer. (d) It shall be unlawful for any licensed manufacttirer to ship In interstate or foreign commerce to any dealer, or for any dealer to receive from such manufacturer any firearm so shipped, unless (1) such dealer is licensed under the provisions of this act, and unless (2) the laws of the State in which such dealer Is located permit the sale of such firearms therein, and (3) except where such flrearma are solely for purposes of display, the prospective purchaser has, prior to such shipment, filed with such dealer a sworn statement that he Is authorized by or tinder the laws of such State to purchase, posasn. and carry such a firearm, and a verified copy of such statement has beoi filed with such manu- factiirer. (e) It shaU be unlawful for any manufacturer to ship In inter- state or foreign commercse any package or container containing any firearms unless such package or container is clearly and con- spicuously marked on the outside cover thereof, or on a label attached thereto, so as to show (1) that a firearm Is contained therein. (2) the name of the mantifacttirer of such firearm. (3) the manufacturer's nvunber or other mark identifying such firearm, (4) the callbw of such firearm, and (6) the name and address of the consignee. (f) Bach licensed manufacturer and licensed dealer shall (1) keep on file all sworn statements or "verified copies thereof, as the case may be. filed pursuant to subdivisions (c) and (d) of this section, and (2) file with the Secretary of Commerce, under such rules and regulations as he shall prescribe, records of all firearms shipped, received, or sold under the provisions of this act. (g) Every common carrier which transports In interstate or forielgn commerce any package or container purporting to con- tain any firearm shaOl keep a permanent record of all matter marked thereon pursuant to subdlvlsicm (e) of this section, which record shall be open to public Inspection. (h) Each firearm other than ammunition shipped in interstate or foreign commerce shaU bear In addition to the manxifacturer's number or other mark identifying such firearm a number supplied by the Department of Coxaxnerot; and the manufacturer shall keep on file at least one biUlet fired frcmi each such firearm, properly Identified as having been so fired. (1) The Secretary of Commerce shall divide the United States into districts, each to be designated by a letter or letters of the alphabet and all cartridge bullets shipped in Interstate commerce shall have imprinted on the ends thereof fitting into the shells a letter or letters corresponding to the letter or letters Indicating the district into which they are shipped. Sec. 3. (a) Any manufactiu^r deelrbtg a license to ship firearms in interstate or foreign commerce, or any dealer desiring a license to receive firearms so shipped, shall make application to the Secre- tary of Commerce who shall by regulation prescribe the Informa- tion to be contained in such application. Upon the filing of the application the applicant shall pay a fee of $ . (b) Upon payment of the prescribed fee the Secretary of Com- merce shall issue to such applicant a license, which shall entitle the licensee to ship firearms in interstate or foreign commerce, or to receive firearms so shipped, as the case may be, unless and until the license is suspended or revoked In accordance with the pro- visions of this act; but no license shaU be issued to any applicant within 2 years after the revocation In the manner provided la subdivision (c) of this section of a previous license Issued to such applicant. (c) Whenever the Secretary of Commerce determines, after notice and hearing, in acx^ordance with regulations prescribed by him. that any licensee under this eecrtlon has violated any of the provisions of this act he may by order suspend the license of such offender for a period of not to exceed 90 days, except that if the violation is a flagrant or repeated violation of such provisions the Secretary may by order revoke the license of the offender. Sec. 4. It shaU be unlawful for any person to ship in Interstate or foreign commerce, or import, any machine gun, or to receive, conceal, store, barter, sell, or dlspoee of any machine gun so shipped or imported. Sec. 5. The provisions of this ac:t shall not apply with respect to the shipment of any firearm or machine gun tised, issued, furnished, purchased, or sold by (1) the United States, or any department, independent establishment, or agency thereof; (2) any State. Territory, or poesession. or the District of Columbia, or any department. Independent establishment, or agency thereof, or any i>olitical subdivision thereof; or (3) any authorized officer or agent of the United States, a State, Territory, or possession, or the District of Columbia, or any political subdivision thereof: nor with respect to shipments for repairs or replacement of parts of firearms; nor with respect to shipments for export to any foreign cxiuntry. In a parcel, package, or c»ntalner labaed In accordance with the specifications of a foreign purchaser and in accordance with the laws of the foreign country. Sec. 6. Any person who files a statement pursuant to subdivision (c) or (d) of section 2, knowing such statement to be false, or who violates any provision of Be<;tlons 2. S, or 4 of this act ahaU. upon conviction thereof, be fined not lees than $ nor mew's than $ , or Imprisoned for not less than nor mcM^e than , <«• both. Sec. 7. Special agents of the Division of Investigation of the Department of Justice shall have, in each State, the same powers in executing this law, as the sheriffs and their deputies in such State may have, by law, In executing the laws thereof. The pcjs- session of a firearm or machine gun which has been shipped in Interstate or foreign commerce without fuU and complete (»mpli- ance with the provisions of this act in respecrt of su<:h firearm or machine gun shall be prima facie evidence of a violation of this act by the person in possession of such fireuTn or machine gun. Sec. 8. This act shall take effect days after Its enactment. Sec. 9. The Secn^tary of Commerce is authorized to prescribe regulations for carrying out the provisicms of this ac;t. Sec. 10. Nothing in sections 1 to 0, inclusive, of this act shaU be construed to amend or repeal any provision of the act entitled "An act declaring pistols, revolvers, and other firearms capable of being concealed on the person nonmailable and jinrovidlng penalty ", approved February 8, 1927. 460 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 461 tional Stolen Property Act." S«c. 2. The term " Interstate or foreign conxmerce " as used this «ct shail Include transportation from one State, Territory, In or united fatates unless notice of an Intention to Interpose suclx defense is given and entered as of record in the case at or before the time defendant is arraigned for trial. purchaser has, prior to such shipment, filed with such dealer a concealed on the person nonmallabte and jHrovkUng penalty ' 0worn statement that he Is authorized by or tinder the laws of ' approved February 8, 1927. : ) 460 CONGRESSIONAL I \,- : -O.I Ssc. 11. ra> The flrst sentence of the act entitled "An acti declaring pistols, revolvers, and other firearms capable of bein^ concealed on the ptrson nonmailable and providing penalty approvet*. February 8. 1927. is amended by inserting immediate before the word • pistols " the words • machine guns, sawed-' shoiguns. and." (bi The second proviso of said act of February 8. 1927. amended to read as follows: "And provided further. That sawed - oJT shotguns, pistols, revolvers, and other firearms capable of bein ; concealed on the person may be conveyed to manufacturers c r dealers licensed under the Federal Firearms Act upon full an 1 complete compliance with the provisions of such act. and may be conveyed to manufacturers and bona fide dealers for repairs anl replacement of parts." Sec. 12. This act may be cited as the Federal Firearms Act. Mr. ROBINSON of Arkansa*. Mr. President, the Senatot from New York [Mr. Copeland] and the other members of the select committee are to be commended for the diligenc ? shou-n in the study that is being made. It relates to a ver^ difBcult and important subject. If public sentiment shall b^ sufficiently aroused, we will witness the termination of gan nile where it exists In the United States. Mr. COPELAND. I thank the Senator from Arkan.sas. TAXATIOK OP INTOXICATING LIQUORS SIGNING OP ENROLLED BIL . On motion of Mr. Robinson of Arkansas, it was Ordered. That the President of the Senate be. and he la hereb3 , authorized to sign,, after the conclu-'lon of the business of th s r Senate today, the enrolled bill iH-R. 6131) to raise revenue br taxing certain Intoxicating liquors, and for other pvuixees EXECUTIVE SESSION Mr. ROBINSON of Arkansas. I move that the Senat^ proceed to the consideration of executive business. The motion was agreed to. and the Senate proceeded to thj consideration of executive business. REPORTS OP COMinTTEES The PRESIDING OFFICER. Reports of committees ar|5 in order. Mr. TYDINGS, from the Committee on Territories an^ Insular Affairs, reported favorably the nomination of Josep Ralston Hayden. of Michigan, to be Vice Governor of th^ Philippine Islands, vice John H. Holliday, resigned. Mr. WALSH, from the Committee on Education and Labot, reported favorably the nomination of Isador Lubin, of the District of Columbia, to be Commissioner of Labor Statistici i. Department of Labor, which was placed on the Executivje Calendar. Mr. DILL. Mr. President, the Committee on Interstatle Commerce directed me to report to the Senate the nominatio i I of Frank P. Glass, of Alabama, as a member of the United States Board of Mediation. I have learned that Mr. Glajs has died since that order was entered. For that reason r will not submit the report, but suggest to the Senator f roi a Alabama that a resolution might be prepared for the puv pose of giving the family of the deceased the salary for tt|e months which he has served. The PRESIDING OFFICER. Are there further reports ^f committees? If there be none, the calendar is in order TREASmiT DEPARTMENT The Chief Clerk read the nominaticm of Marion Glais Banister, of Virginia, to be Assistant Treasurer. The PRESIDING OFFICER. Without objection, tl^e nomination is confirmed. The Chief Clerk read the nomination of Byrd Leavell, 4^ Virginia, to be Assistant Register of the Treasury. The PRESIDING OFFICER. Without objection, tl^e nomination is confirmed. The Chief Clerk read the nomination of Mark A. Skinner to be superintendent of the mint, Denver, Colo. The PRESIDINO OFFICER. Without objection. U^e nomination is confirmed. The Chief Clerk read the nomination of Bruce B. La Fo lette to be assayer in the mint. Denver. Colo. The PRESIDINO OFFICER. Without objection, tl^e nomination is confirmed. The Chief Clerk read the nomination of Hugh T. Rippe to be assayer in charge of the mint. New Orleans. La. The PRESIDINO OFFICER. Without objection, tl^e nomination Is confirmed. RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 461 DEP.\RTMENT OP STATE — ASSISTANT SECRETARIES The Chief Clerk read the nomination of R. Walton Moore, of Virginia, to be Assistant Secretary of State. The PRESIDING OFFICER. Without objection, the nomination is confirmed. The Chief Clerk read the nomination of Piancis Bowes Sayre. of Massachusetts, to be Assistant Secretary of State. The PRESIDING OFFICER. Without objection, the nomination is confirmed. SUMNER WELLES The Chief Clerk read the name of Sumner Welles, of Maryland, to be Assistant .Secretary of State. Mr. PITTMAN. The senior Senator from Idaho [Mr. Borah] has requested that that nomination go over until tomorrow, as he desires to be present when it is considered. The PRESIDING OFFICER. Without objection, the nom- ination will go over until tomorrow. AMBASSADOR TO SOVIET UNION — WILLIAM C. BULLITT The Chief Clerk read the nomination of William Christian Bullitt, of Pennsylvania, to be ambassador extraordinary and plenipotentiary to the Union of Soviet Socialist Re- publics. Mr. VANDENBERG. Mr. President, is it the desire to take up this nomination this afternoon, may I inquire? Mr. PITTMAN. It is; unless the Senator has serious ob- jection to its being taken up this afternoon. ''■/ Mr. VANDENBERG. I should like to state that I am entirely willing to proceed, but it will take 10 or 15 minutes of the Senate's time to discuss it. Mr. PITTMAN. I think, under the circumstances, we had better proceed with the nomination. Mr. VANDENBERG. Mr. President. I shall deal now with the pending nomination of the new United States Ambas- sador Extraordinary and Plenipotentiary to the Union of Soviet Socialist Republics. The Senate Committee on For- eign Relations yesterday took two actions, only one of which has been reported in the public press. The unreported action, in my view, was the more important and the more significant. On the one hand, the committee voted, with two dissenting votes, one of which was mine, for reasons hereafter stated, to report to the Senate the nomination of William Christian Bullitt to fill this new ambassadorship. It occurs to me, I might say parenthetically, that it is some- what ironical to send a " Christian " to Russia in this ca- pacity. The other action taken by the committee was the unanimous adoption of a resolution which I submitted re- questing the President, if not incompatible with the public interest, to submit to the committee and the Senate all the papers involved in the agreement which was reached be- tween the President and the representative of the Russian Soviet Union upon which the recognition of the Soviet Gov- ernment is based and the appointment of this ambassador is predicated. My motion sought the full official information respecting the arrangement which has been entered into governing the contacts and the warrants which are to exist between these two countries. The only information heretofore available to the Con- gress upon this subject, the only information available to the Committee on Foreign Relations, has been the casual information carried in the newspapers. It did not seem to me appropriate that in a matter of this long standing and often bitter controversy, and in a matter of this major impor- tance in the opinion of many of the American p>eople, that the Senate and the Foreign Relations Committee should be guided solely by what they had seen in the public prints. Indeed, it would have been most unfortunate if we had rested upon that basis of information because, if that basis of information is to be relied upon, I am wondering what we would say in respect to the publications that have ap- peared indicating that Moscow has already suggested a repudiation of the warranties that are contained in the agreement between the two countries. I hasten to add that apparently there is no foundation for this gossip of repudia- tion. I am simply making the point, at the outset, that we had no business to rely in a situation of this character upon unofficial information obtained solely from the newspapers. I say, with great respect, that it would have been highly appropriate for the President of the United States to have addressed a message to the Senate formally notifying us of his action with respect to the recognition of Russia and sub- mitting to us officially the agreements upon which that rec- ognition is based. The Senate has partnership responsi- bility with the Executive for our foreign relations, and com- plete mutual information is at all times desirable. There are some things that cannot be rubber-stamped, no matter what our faith. Mr. President, these two questions, that of the recognition of the Soviet Government, and that of the confirmation of the ambassador to the Soviet Union, in my view, are philo- sophically related. I freely consent that a powerful argu- ment can be made, and with entire propriety, that the Con- gress has no actual jurisdiction whatsoever over the actual act of recognition. I concede that it is exclusively an Execu- 'tive function and prerogative to recognize foreign govern- ments. But I am unable to escape the conviction, since the recognition of this particular government has been a sub- ject of such long-standing controversy and has been a sub- ject of so many critical State papers under three or four administrations, that there is at last an indirect relation- ship between these two propositions — the proposition upon the one hand of recognition, which is exclusively an Execu- tive function, the proposition upon the other hand of the confirmation of an ambassador to Russia, which is exclu- sively a senatorial function. Underneath both there is a common problem and a common responsibility. Therefore, because of this belief and because of the belief that the entire official record should be a part of the official record of the Committee on Foreign Relations and the Senate before any action be taken in respect to confirmation, I offered the resolution in the committee to which I have ad- verted. The resolution was adopted. I voted in committee against the confirmation of Mr. William Christian Bullitt, with the statement at the time that I did it pending the arrival of these papers. I voted in protest against any blind action by the Senate in advance of full official information respecting this epochal decision which has reversed the de- cisions of four previous occupants of the White House. Mr. President, the State Department very prcMnptly and courteously responded unofficially to the spirit of the resolu- tion by immediately sending to the distinguished chairman of the committee the official printed copies of all of the exchanges between President Roosevelt and Mr, Maxim Litvinoff, the People's Commissar for Foreign Affairs of the Union of Soviet Socialist Republics. I now have this com- pilation in my hand. It is an official publication identified as Eastern European Series No. 1 of the Department of of State. I understand that the formal report will be sub- sequently forthcoming. Therefore, so far as I am concerned, I am willing now to proceed upon the theory that we do have the information in reliable and authentic form upon which intelligently to proceed. It is for the purpose of emphasizing the nature of these cmitacts and these war- ranties and these solemn agreements that I rise ^ speak at the moment in respect to the confirmation. In many aspects, the rights and the institutions of American citizens hang upon the integrity of these undertakings. It is my purpose to say that time and events wiU vindicate the action of the President only in the degree that these engagements do not degenerate into diplomatic " scraps of paper." Mr. President, we have no right to question the kind of government which exists under any other flag so long as it is a stable government in the accepted sense of that word. Much as I have opposed the recognition of Russia, and I think primarily upon the ground that I believe that no country which outlaws God can rise to an acceptable place in the parliament of nations because any such nation seems destined for spiritual bankruptcy, regardless of what I may have felt respecting the recognition of Russia, my attitude certainly has not been based upon any theory that we have any right to dictate to another people or that we have any right to pass censorship upon the type of government which they elect to choose for themselves. That is none of our legitimate business. But, Mr. President, that vital rule works both ways. That rule is utterly reciiMTOcaL The reason fundamentally why I have opposed the recognition of Russia is that we, too, have a right to elect our own form of government without any outside interference, and so long as the Russian Gov- ernment was engaged in subvertive propaganda officially or semiofficially, directed from Moscow in any degree — propaganda aimed at the destruction of our form of govern- ment within our own United States — that we had no justi- fication whatsoever in governmental philosophy or ethics or international fair play to accept, on the basis of com- mon partnership and parity in the family of nations, an institution of that obnoxious charabter. Therefore the fundamental question, so far as the recog- nition of Russia is concerned, which has challenged my con- cern, is this particular question whether or not we have received adequate, dependable, reliable, and enforcible as- surances that this sort of imported treason is to cease. Now, let us refer to the official records and see to what extent this result has been accomplished, at least in the letter of the bond. Mr. President, I want to read the first of the letters addressed to the President of the United States by Mr. Litvinoil. May I say before I read it that I think it is highly important that it shouldi; be read, so that no one beyond the seas may have any misconception of the fact that these guaranties are fundamental and primary and continuous so far as our relationships with the Russian Soviet Government are concerned. "Iliey are not idle diplo- matic gestures. They are hard realities. Because I think it should be a part of our official record before the vote is taken, I read the first of these commitments. It is a letter addressed to the President of the United States by Mr. Litvinoff: Mt Dear Mb. Prksidknt: I have the honor to Inform you that coincident with the establishment of diplomatic relations between our two Governments It will be the fixed policy of the Govern- ment of the Union of Soviet Socialist Republics — 1. To respect scrupulously the indisputable right of the United States to order Its own life within Its own jurisdiction in Its own way and to refrain from Interfering In any manner In the Internal affairs of the United States, its Territories, or possessions. Mr. President, the maintenance of the unqualified integrity of that assurance may make it possible for friendly relations to exist between these two peoples. But if any such promise be made with the tongue in the cheek as these people some- times have made promises to others, if any such promise be made with any such reservation as sometimes attached to similar promises heretofore, namely, that it is to be honored in its treacherous breach, then there is no chance whatever for a permanently friendly relationship. I think it is worth saying emphatically and in plain language and as an axiom that the continuity of this pledge is just as important as the giving of it in the first instance. Our newly acknowledged friends cannot complain of these frank observations. I am sajring even less than previous Presidents and previous Sec- retaries of State have said when dealing with this same subject. I continue with the reading of the pledge of the Soviet Government: 2. To refrain, and to restrain all persons in Government service, and all organizations of the Government or tinder Its direct or indirect control, including organizations In receipt of any financial assistance from It, from any act overt or covert liable In any way whatsoever to Injure the tranquillity, prosperity, OTder. or sectirlty of the whole or any part of the United States, Its Territories, or possessions, and, in particular, from any act tending to Incite or encourage armed intervention or any agitation or propaganda having as an aim the violation of the territorial Integrity of the United States, Its Territories, or possessions, or the bringing about by force of a change In the political or social order of the whole or any part of the United States, its Territories, or possessions. That is an all-inclusive statement. If that statement lives in practice as well as in precept, the future is far less Jeop- ardized than I have feared it would be in these relationships. But, again, the good faith of the pledge is tl^ test of its value; and I think it is worth emphasizing upon this floor. 462 CONGRESSIONAL RECORD— SENATE January 11 1934 CONGRESSIONAL RECORD— SENATE 463 The PRESIDINO OFFICER, nomination Is conflrmed. Without objection, tlie tion. I am simply makmg the pomt, at the outset, that we had no business to rely in a situation of this character upon right to pass censorship upon the type of government which value; and I think it Is worth emphafiiang upon this floor. 462 CONGRESSIONAL The pl:dge is e\en more coit KS O Us as we proceed to confirm the first ambassador to the Soviel s in more than a decade, that this p!:dge must be continuous and mu5t be hcncred actively and not passively, or tte relationship cannot sastam itself. Of course, we must pre cecd en ihc theory tha: gocd faith will be observed until < r unl?s;i there shall be subsequent demonstration to the con::aiy. But I have net finished pletc. I quote: Not to permit the formation or residence on Ita territory of ai^y cr^anization or group — And this is particularly important because of the fact thit the Russian propaganda activit'.es wh:ch heretofore hare t>ci-n aimed at the heart of America have ordinarily beejn admini-stered through a collateral Moscow agency Continuing the reading: Not to permit the formation or residence on its territory of nijy orKatnzalion or group and to prevent the activity on Its territory cf a.iy crgaiU^tio.i or grucip. or of ipprcxntatlvos or offlclals ^f »ny nrijanization or group — which makes claim to be the Gove mrnt of, cr rr.&'i^s attempt upon the territorial Integrity of. United State*. Its Territories o-- poRscf^alons; n )t to form, subsldi* •uppori, or permit on Its territory military orkjanlzatlons or grou] having the .'.in\ cf a.rncJ strv..;slc .i„ .in::t the United States, i; Territories cr po .scbslouj, and to prevent any recruiting on behajlf Of such organizations and groTpe. Acain the warranty on the fac:? of the contract is al - inclusive. But even this is not all. I continue the reading: Not to permli, the iormation or reslden«!e on Its territory of aiy organlc-tl'jn or group— and to prevcr.t th2 activity on its terii- tory of any organii:ation or ^roup. or of representatives or.officialr of anv orga.nlzatlon or group which ha3 ao an .Tim the ovorthrqw or the preparation for the overthrow of, or the brlnglrg about force oi a cl:ani;f w.. ihc poWtlciil cr socl-il order of .l.e whclc any pnrt of the United States, its Territories, or possessions. Mr. President, it seems to me that if any contract is be Wiitten txtween Russia und the United States this alwut as complete a contract as could be devised to covtr the situation which has so disturbed the viewpoint of the Un;teJ States in ro:.pect to Rusoiau propaganda during ll^e past decade. Mr. SCHAIX. Mr. President Mr. VANDENBERG. I yield to the Senator from Mi^i- nesota. Mr. SCHALL. Is this man Bullitt, who has been nam^d as Ambassador to Russia, the .same Bullitt who. at the ou : set of this Administration, was maneuvering around Europe, and claimed that he represented the President the United States? I remember that the Senator from Indiana [Mr. Robinso^I called attention to the matter at the time; and I a remember the leader cf the minority, the Senator fr Ari:?.nsas I Mr, Robinson 1. stating, as I remember, that t President denied that he had anything to do with Bui He denied him thrice before the cock could crow aga Mr. VANDENBEIRQ. Mr. Piesident. I think this is t: same Mr. Bullitt: and I anticipate that the Senator fr Indiana I Mr. Robinson] will again speak for himself on t subject. At the moment I wish to pursue what I deem to a far more important phase of this matter; namely, t foundation which has been laid beneath the act of appoint- ment which brings this confirmation to the Senate. A stream can rise no higher than its source, and the iip- portant thing at the moment is less the personality Bullitt than it is the basis of contractual relationship which recognition has been granted, out of which the a^ pointment of tlie Ambassador comes I have read the first of these letters, Mr. Presiden^. The letter which I have read is signed by Mr. Maxim Litvincff, People's Commissar for Foreign Affairs, Union of Sov et Socialistic Republics. In the committee on yesterday the question was raisfed whether Mr. Latvinoff had the authority to bind his Gcv- ernment. So far as the committee could determine, tie answer to that question is in the alBrmative. There ap- pears to be no requirement that Mr. Litvinoff's warrarjty RECORD— SENATE January 11 n Df of Mr. p upon must return to Moscow for any review or approval. There- fore. I assume that we are entitled to accept this official publication from the State Department as a Uteral and con- clusive fact in respect to the protections which we seek against this subvertive propaganda. I assume it is a closed book. I want to make it perfectly plain that I am not In the shghtest degree fearful of any raid by communism on America. I think Mr. Stalin himself has recently said that communism Ls not an exportable product. I doubt whether it ever could be successfully exported to the United States. But fear does not need to precede vigilance. I have been raised in the theory that vigilance is the price of liberty. Therefore, it has seemed to me that complete and effective and conclusive defense against the infiltration of America by subversive propaganda was a prerequisite to any relation- ships of an ofScial nature with Moscow. It is said truthfully that European governments .have re-^ ceived warranties of a somewhat similar nature, assuming to protect them in the past against subvertive Russian propaganda, and that these promises have been broken; but perhaps it is fair to discriminate between the two situations. Apparently, the agreements that were made by some Euro- p>ean capitals with Moscow were not made in definite terms. Apparently, the contracts which heretofore have been broken have been broken thiough a misunderstanding, or at least that plea may be made in defense or in mitigation of those who broke them. Perhaps it was that particular situation which moved the President of the United States to be scrupulously detailed when he wrote the agreement under which we are to be protected against similar jeopardy and similar outrage. At any rate. I cannot conceive how it would be possible to put into words a more complete protection against the thing which I have believed fundamentally we must be protected against before any oIBcial relationships could be appro- priately renewed. May I say. in order to make the record as conclusive as possible, that the letter from Mr. Litvinoff. which I have just read, was acknowledged by President Roosevelt from the White House, under date of November 16. repeating ver- batim the pledges and the promises which were made; so that there can be hereafter no equivocation whatsoever, no pleadings of misunderstanding in any circumstance, if these pledges are not kept. I think it is utterly essential, when we proceed for the first time in the Senate of the United States to consider the relationship between these two countries, that it should be said bluntly and without equivo- cation that the continuity of these pledges in good faith is the price of the continuity of these relationships. We shall not bleep on oin- rights. Nor have we taken an anesthetic. I commend the Russian commissar for going to the last possible extreme in writing these assurances. I shall com- mend his Government still more for implementing them with continuous integrity. Here indeed is a situation where the proof of the pudding will be in the eating thereof. There were other questions involved, Mr. President, be- tween these two Governments, which apparently it was deemed advisable to liquidate in detail. Nothing, for ex- ample, could be more important that the sacred guaranty of religious freedom for our nationals in Russia, and the acknowledgment of their civil rights. I shall not take the time of the Senate to read the supplemental exchanges of letters between Mr. Litvinoff and President Roosevelt, other than to say that they cover a number of other controverted problems and in much the same detail and with much the same successful effect so far as the letter of the contracts is concerned. I do feel, however, that the record should be absolutely complete against a day of possible judgment. Therefore I ask. in connection with these observations, that the whole of this official correspondence shall be printed in the Record. It is by far the most important part of these proceedings. I sliall then follow this exhibit with my final conclusions. The VICE PRESIDENT. Without objection, it is so ordered. 1934 CONGRESSIONAL RECORD— SENATE 463 Tlie matter referred to is as follows: XrrABUSHMKKT OF DIPLOMATIC RlXATIONS WITH THZ UlTION OT SovixT Socialist Republics ekchamgb ot cobbkspoirdencc between president koosevelt and pu8iocmt kalinin ' The White House, Washington, October 10, 1933. Mr DcAi Ms. Psesidcnt: Since the beginning of my aecial regulations laid down by the Peoples Commissariat for Internal Affairs are observed. (Decree of Apr. 8, 1929, art. 45.)" 4. " The right to collect from their coreligionists • • • volun- tary offering's for religious purposes." This right is supported by the following law: " Members of groups of believers and religious societies may raise subscriptions among themselves and collect voluntary offer- ings, both in the place of worship itself and outside it, but only amongst the members of the religious association concerned and only for purposes connected with the upkeep of the place of wor- ship and the religious property, for the engagement of ministers of religion and for the expenses of their executive body. Any form of forced contribution in aid of religious associations is pun- ishable under the Criminal Code " (decree of Apr. 8, 1929, art. 54) 5. Right to " Impart religious instruction to their children either singly or In groups or to have such Instruction imparted by persons whom they may employ for such purpose." This right is supported by the fcllovv-ing law: " The school Is separated from the church. Instruction In reli- gious doctrllies Is not permitted In any governmental and common schools, nor In private teaching Institutions where general subjects are taught. Persons may give or receive religious Instruction in a private manner " (decree of Jan. 23, 1918, art. 9). Furthermore, the Soviet Government Is prepared to include In a consular convention to be negotiated Immediately following the establishment of relations between our two countries provisions In which nationals of the United States shall be granted rights with reference to freedom of conscience and the free exercise of religion which shall not be less favorable than those enjoyed In the Union of Soviet Socialist Republics by nationals of the nation most fa- vored in this respect. In this connection. I have the honor to call to your attention article 9 of the treaty between Germany and the Union of Soviet Socialist Republics, signed at Moscow October 12. 1925. which reads as follows: " Nationals of each of the contracting parties • * • shall be entitled to hold religious services in churches, houses, or other buildings, rented, according to the laws of the country. In their national language or in any other language which Is customary in their religion. They shall be entitled to bury their dead in accordance with their religious practice in burial grounds estab- lished and maintained by them with the approval of the compe- tent .-iuthorities. so long as they comply with the police regulations of the other party In respect of buildings and public health." Furthermore, I desire to state that the rights specified In the above paragraphs will be granted to American nationals Immedi- ately upon the establishment of relations between our two countries. Finally, I have the honor to Inform you that the Government of the Union of Soviet Socialist Republics, while reserving to Itself the right of refusing visas to Americans desiring to enter the Union of Soviet Socialist Republics on personal grounds, does not Intend to base such refusals on the fact of such persons having an eccle- siastical status. I am. my dear Mr. President, Very sincerely yours, Maxim Lttvinoff, People's Commissar for Foreign Affairs, Union of Soviet Socialist Republics. Mr. Franklin D. Roosevelt, President of the United States of America, The White House. Washington, November 16, 1933. My Dear Mr. President: Following our conversations I have the honor to inform you that the Soviet Government is prepared to include in a consular convention to be negotiated immediately following the establishment of relations between our two coun- tries provisions in which nationals of the United States shall be granted rights with reference to legal protection which shall not be less favorable than those enjoyed In the Union of Soviet Socialist Republics by nationals of the nation most favored In this respect. Furthermore, I desire to state that such rights will be granted to American nationals Immediately upon the establishment of rela- tions between our two countries. In this connection I have the honor to call to your attention article 11 and the protocol to article 11, of the Agreement Con- cerning Conditions of Residence and Business and Legal Protection in General concluded between Germany and the Union of Soviet Socialist Republics on October 12, 1925. "Article 11 " Each of the contracting parties undertakes to adopt the neces- sary measures to inform tthe consul of the other party as soon as possible whenever a national of the country which he represents is arrested in his district. " The same procedure shall apply if a prisoner is transferred from one place of detention to another. " final protocol (Ad article 11) " 1. The consul shall be notified either by a commxinlcatlon from the person arrested or by the authorities themselves direct. Such communications shall be made within a period not exceed- ing seven times 24 hotirs, and in large towns, including capitals of districts, within a period not exceeding three times 24 hours. " 2. In places of detention of all kinds requests made by con- sular representatives to visit nationals of their country under arrest, or to have them visited by their representatives, shall be granted without delay. The consular representative shall not be entitled to require officials of the cotirts or prisons to withdraw during his Interview with the person under arrest." I am. my dear Mr. President, Very sincerely yotirs, Maxim LrrviNorr, People's Commissar for Foreign Affairs, Union of Soviet Socialist Republica. Mr. Franklin D. Roosevelt, President of the United States of America. The White House. The White House. Washington. November 16, 1933. My Dear Mr. LrmNorr: I thank you for your letter of Novem- ber 16, 1933, informing me that the Soviet Government Is pre- pared to grant to nationals of the United States rights with ref- erence to legal protection not less favorable than those enjoyed in the Union of Soviet Socialist Republics by nationals of the nation most favored In this respect. I have noted the provisions of the treaty and protocol concluded between Germany and the Union of Soviet Socialist Republics on October 12, 1925. I am glad that nationals of the United States will enjoy the protection afforded by these Instruments Immediately upon the establishment of relations between our countries and I am fully prepared to negotiate a consular convention covering these sub- jects as soon as practicable. Let me add that American diplo- matic and consular officers In the Soviet Union will be zealous In guarding the rights of American nationals, particularly the right to a fair, public, and speedy trial and the right to be represented by counsel of their choice. We shall expect that the nearest Amerlcail diplomatic or consular officer shall be notified Immedi- ately of any arrest or detention of an American national, and that he shall promptly be afforded the opportunity to communi- cate and converse with such national. I am. My dear Mr. Litvlnoff, Very sincerely yours, Peanklin D. Roosevelt. Mr. Maxim M. LmnNOPT, People's Commissar for Foreign Affairs. Union of Soinet Socialist Republics. In reply to a question of the President in regard to prosecutions for economic espionage. Mr. Litvlnoff gave the following explana- tion: ^. ^ , " The widespread opinion that the dissemination of economic Information from the Union of Soviet Socialist Republics Is al- lowed only Insofar as this Information has been published In newspapers or magazines, is erroneous. The right to obtain eco- nomic information Is limited In the Union of Soviet Socialist Republics, as In other countries, only In the case of business and production secrets and in the case of the employment of for- bidden methods (bribery, theft, fraud, etc.) to obtain such Infor- mation The category of business and production secrets nat- urally includes the official economic plans. Insofar as they have not been made public, but not Individual reports concerning the production conditions and the general conditions of individual enterprises. , . ■' The Union of Soviet Socialist Republics has also no reason to complicate or hinder the critical examination of its economic or- ganization. It naturally follows from this that everyone has the right to talk about economic matters or to receive Information alx)ut such matters In the Union, Insofar as the Information for which he has asked or which has been Imparted to him Is not such as may not. on the basis of special regulations Issued by responsible officials or by the appropriate state enterprises, be made known to outsiders. (Tills principle applies primarily to Information concerning economic trends and tendencies.) Washington. Notyember 16, 1933. Mt Dear Mr. PREsroENr: Following our conversations I have the honor to Inform you that the Government of the Union o' Soviet Socialist Republics agrees that, preparatory to a final settlement of the claims and counterclaims between the Governments of the Union of Soviet Socialist Republics and the United States of America and the claims of their nationals, the Government of the Union of Soviet Socialist Republics will not take any steps to enforce any decisions of courts or Initiate any new litigations for the amounts admitted to be due or that may be found to be due It as the successor of prior Governments of Russia, or otherwise, from American nationals, including corporations, companies part- nerships or associations, dnd also the claim against the United States of the Russian Volunteer Fleet, now in litigation in the United States Covirt of Claims, and will not object to sucli amounts being assigned and does hereby release and assign all Lxxvni- -30 466 CONGRESSIONAL I RECORD— SENATE January 11 such amount* to the Government of the United States, the Gov- ernment of the Union of Soviet Socialist Republics to be dulj notified In each case of any amount realized by the Governmenl of the United States from such release and assignment. The Government of the ^"^nlon of Soviet Socialist Republics fur- ther agrees, preparatory to the settlement referred to above, no1 to make any cla;m with respect to: (a) Judgments rendered or that may be rendered by American courts insofar as they relate to property, or rights, or Interest! therein. In which the Union of Soviet Socialist Republics or lU nationals may have had or may claim to have an Interest; or (b) Acts done or settlements made by or with the Governmenl of the United States, or public officials in the United States, oi Its nationals, relating to property, credits, or obligations of anj Government of Russia or nationals thereof. I am. my dear Mr. President, Very sincerely yours, Maxim LrrviNOFr, People's Commissar for Foreign Affairs, UnUm of Soviet Socialiat Republics Mr. P»AintLiw D. Roosbvxlt, President of the United States of America, The White House. The Whttx Housx, Washington. November 18. 1933. Mr DSAii Ms. LrrvTNOfT: I am happy to acknowledge the recelp . of your letter of November 16, 1933, in which you state that: " The Government of the Union of Soviet Socialist Republlci Agrees that, preparatory to a final settlement of the claims am counter claims between the Governments of the Union of Soviei Socialist Republics and the United States of America and thr claims of their nationals, the Government of the Union of Sovlei Socialist Republics will not take any steps to enforce any decl' alons of courts or Initiate any new litigations for the amounts admitted to be due or that may t>e found to be due It, as the suc' cessor of prior Governments of Russia, or otherwise, from Amerl' can nationals. Including corporations, companies, partnerships, or associations, and also the claim against the United States of thr Riiaslan Volunteer Fleet, now in litigation In the United Statei Court of Claims, and will not object to such amounts being as- signed and does hereby release and assign all such amounts to th< Government of the United States, the Government of the Unior of Soviet Socialist Republics to be duly notified In each case ol any amount realized by the Government of the United States from such release and assignment. " The Government of the Union of Soviet Socialist Republic* further agrees, preparatory to the settlement referred to above, not to make any claim with respect to: "(a) Judgments rendered or that may be rendered by American courts lnv>far as they relate to property, or rights, or interests therein, in which the Union of Soviet Socialist Republics or Ita nationals may have had or may claim to have an Interest; or "(b) Acts done or settlements made by or with the Government of the United States, or public ofHcials In the United States, oi Its nationals, relating to property, credits, or obligations of any Government of Russia or nationals thereof." I am glad to have these undertakings by your Government ant! I Khali be pleased to notfy your Government In each case of anj amount realized by the Government of the United States from th« release and assignment to it of the amounU admitted to be due, oi that may be found to be due, the Government of the Union ol Soviet Socialist Republics, and of the amount that may be found to be due on the claim of the Russian Volunteei Fleet. 1 am. my dear Mr. Litvinov, Very sincerely yours, Fkaitkun D. Roosxvzlt. Mr. BIaxim M. LrrvTNorr, People's Commissar for Foreign Affairs. Union of Soviet Socialist Republics, Washington, November 18, 1933. Mt Deas Mk. PaisiPCTrr: I have the hono- to Inform you that, following our conversations and following my examination of cer tain documents of the years 1918 to 1921 relating to the attitude of the American Government toward the expedition Into Siberia, the operations there of foreign military forces and the Inviolability cf the territory of the Union of Soviet Socialist Republics, the Government of the Union of Soviet Socialist Republics agrees that It will waive any and all claims of whatsoever character arising out of activities of military forces of the United States In Siberia or assistance to military forces in Siberia subsequent to January 1 1918. and that such claims shall be regarded as finally settled and disposed of by this agreement. 2 am. my dear Mr. President, Very sincerely yours, Maxim LrrviNorr, People's Commissar for Foreign Affairs. Union of Soviet Socialist Republics. Me. PkAKKUH D. RoosrvcT, FresideiU o/ the United States of America. The White House. Thk Whiti Hotjse. Washington. November 16, 1933. JOINT STATEMENT BT THE PRESIDE>rT AND MR. LirVINOrT In addition to the agreements which we have signed today, there has taken place an exchange of views with regard to methods of settling all outstanding questions of indebtedness and claims that permits us to hope for a speedy and satisfactory solution of these questions which both oxir Governments desire to have out of the way as soon as possible. Mr. Litvlnoff will remain in Washington for several days for further discussions. EXCHANGE OF COEaESPONOENCE BETWEEN ACTING SECRET.\RY PHILLIPS AND THE RT7SSIAN FINANCIAL ATTACHE IN THE UNITED STATES; TELE- GRAMS ADDRESSED BT ACTING SECRETART PHILLIPS TO RUSSIAN CON- SULAB OmCXX IN THE UNITED STATES ' New York, October 21. 1933. Dear Mr. Kellet: The correspondence between the President of the United States and Mr. Kalinin. President of the All Union Central Executive Committee, leads me to believe that conditions may arise In the near future, where no further \is«ful purpose can be served by my continuing to exercise the duties with which I was vested under the exchange of notes between the Russian Am- bassador and the Secretary of State of April 28 and 29. 1922.' In consequence of thU belief, may I not request that my present status be discontinued at the earliest convenience of the Depart- ment of State. As to certain matters of a continuing character requiring further attention. I would respectfully suggest that after the date of the discontinuance of my status they be considered as being temporarily taken under the care of the United btates Government. In terminating my official activities, I deem it a paramount duty to express my deep appreciation for the unfailing consideration with which I have been treated at the Department of State. Per- mit me also to say that If a moral satisfaction has been derived by me during the trying years of my service. It has been due mainly to the cognizance that I have enjoyed the confidence of the Government of the United States. Very sincerely yours, S. Ughet. Russian Financial Attachi. Hon. RoBXKT P. Kellet, Chief, Division of Eastern European Affairs, Department of State, Washington. D.C. Department of State. November 16. 1933. Mt Dear Mr. Ughet: I desire to refer to your letter of October 21. 1933. in which you expressed the belief that conditions would arise in the near future when no further useful purpose would be served by your continuing to exercise the duties with which you were charged under the exchange of notes between the Russian Ambassador and the Secretary' of State of April 28-29. 1922, and requested that your present status be discontinued at the earliest convenience of the Department of State. In view of the recognition of the Union of Soviet Socialist Re- publics by the Government of the United States. I have to inform you that upon this date the Government of the United States ceases to recognize you as Russian Financial Attach^. The Department L^ deeply appreciative of the able manner In which you have discharged the duties which devolved upon you under the exchange of notes referred to above and of the friendly spirit with which you have for so many years cooperated with this Government. I should like to take the occasion to extend to you personally my cordial good wishes for your future happiness and success. Very sincerely yours, William Phillips. Acting Secretary of State. Mr. Serge Ughet. 17 East Forty-fifth Street, New York City. (Telegram] Department of State, Not>ember 17, 1933. Mr, Joseph A. Cowrt, Russian Consul. Boston, Mass.: In view of the recognition of the Union of Soviet Socialist Re- publics by the Government of the United States, you are informed that the exequatur Issued on September 20. 1912, recognizing you as consul of Russia at Boston, Is revoked, effective as of November 16. 1933. and that consequently your status as Russian consul la considered terminated as of that date. WnxiAM Phillips. Acting Secretarg. ' Issued by the Department of State as a mimeographed press release. Nov, 17, 1933, » Issued by the Department of State as a mimeographed preM release, June 4. 1922. See Appendix, p. 21. 1934 CONGRESSIONAL RECORD— SENATE 467 [Telegram] Department of State, November 17, 1933. Mr. Antoine Volkoff, Rii.tsian Consul General, Chicago, III.: In view of the recognition of the Union of Soviet Socialist Republics by the Government of the United States, you are in- formed that the exequatur issued on June 24. 1914. recognizing you as Consul General of Russia at Chicago, is revoked, elTectlve as of November 16, 1933, and that consequently your status as Rusbian consvil general is considered terminated as of that date. William Piiu.lips, Acting Secretary. [Te'ecram] »-' Department of State, '' November 17. 1933. Mr. Nikolai Bogotavlensky, Russian Consul General, Seattle, Wash.: In view of the recognition of the Union of Soviet Soclall.st Republics by the Government of the United States, you are in- formed that the exequatur Issued on May 26, 1915. recognizing you as consul general of Russia at Seattle, is revoked, effective as of November 18. 1933, and that consequently your status as Russian consul general Is considered terminated as of that date. William Phillips, Acting Secretary. statement by secretary lIULt., NOVFMDER 10* The Secretary of State, on board the steamship American Legion at sea, telegraphed the following statement to the Department of 8tate on November 18: '• I am pratlfled to learn that the pooples of the United States and RuPjla. pfter a frank exchange of views at Wa.shlngton, have resumed normal relations and that thp preliminary basis agreed upon l3 substantially that indicated before I left Washington. The badly confused world situation will be improved by this natural and timely step which is procif of the marked progres.s possible in all International dealings when there exists such splendid inltintlve as that displayed by the President and the mutual dlspasltion and will to approach serious world problems in a friendly and fearless spirit." CIRCULAR INSTRUCTIONS TO ALL AMERICAN DIPLOMATIC MISSIONS, NOVEM3EH 1 7 '" The Acting Secretary of State. Mr. William Phillips, on November 17, sent the following circular to all diplomatic miscions: '• Following; an exchange of communications between the Presi- dent and the Commlrsar for Foreign Affairs of the Union of Soviet Socialist Republics, covering outiitanding questions in the relations between the United States and the Soviet Union and the arrival at an understanding with respect to methods of settling the ques- tion of debts and claims, the President communicated to Mr. Lit- vlnoff in a note dated November 16, 1933, the decision of the Gov- ernment of the United States to establish diplomatic relations with the Soviet Union. " In view of the recognition thus accorded by the Government of the United States to the Union of Soviet Socialist Republics, you should enter into cordial official and social relations with your Soviet colleague In accordance with the established practice of the post at which you are stationed. " Soviet passports sliould be treated henceforth as passports of other recognized governments. " Inform consuls." STATEMENT BT ACTING SECRETARY PHILLIPS, NOVEMBER 22 " In accordance with the Joint statement by the President and Mr. Litvlnoff of November 16. 1933, further discussions have taken place between Mr. Litvlnoff and officials of the Department of State and the Treasury Department. Due to the intricacy of the questions to be explored, it has been impossible to reach definite conclusions before the departure of Mr. Litvlnoff. The discus- sions will be actively continued by officials of both Governments. The conversations which have thus far taken place have shown a desire on the part of both Governments to reach a speedy solution of these questions EXCHANGE OF CORRESPONDENCE BETWEEN PRESIDENT ROOSEVELT AND MR. LITVINOFF, NOVEMBEP. 22 AND 23 " Wa.^.hincton, November 22. 1933. My Dear Mr. President: On leaving the United States I feel It a great pleasure respectfully to convey to you my feelings of high esteem as well as gratitude for the many tokens of attention and friendchlp you have been good enough to show m.e during my stav In Washington. I also wish hereby to thank the whole Executive and Its various crgiins for their courtesies and cares. I avail myself of this opportunity to express onee more my firm conviction that the official linking of our two countries by the exchange of notes between you, Mr. President, and myself will be of great benefit to our two countries and will also be conducive to the strengthening and preservation of peace between nations toward which our countries are sincerely striving. I believe that their Joint efforts will add a creative factor in international affairs which will be beneficial to mankind. Believe me to be. my dear Mr. President, with the best wishes for the well being of yourself, your family and of your great country. Yours very sincerely, Maxim LrrviNorr, Peoples' Commissar for Foreign Affairs, Union of Soviet Socialist Republics. Mr, Franklin D. Roosevelt, President of the United States of America, The White House. Warm Spring^, Ga., November 23, 1933. My Dear Mr. LiTviNorr: I thank you for your most courteous let- ter of November 22. 1933. It has been a great personal pleasure to me to meet you and I trust that some day I shall again have the pleasure of welcoming you In America. On your return to your country I hope that you will convey to President Kalinin my greetings and best wishes. I am profoundly (;ratifled that our conversations should have resulted In the restoration of normal relatione between our peoples and I trust that these rclutlons will grow closer and more inti- mate with each pasbing year. The cooperation of our Govern- ments In the great woric of preserving peace should be the corner- stone of an enduring friendship. I am sorry that owing to my absence from Washington I am unable In person to say good-bye to you and to wish you a safe and pleasant Journey; but I assure you that you carry with you my warmest personal regards. Yours very sincerely, Franklin D. Roosevelt, Mr. Maxim M. LiT%iNorF, Peoples' Commissar for Foreign Affairs, Union of Soviet Socialist Republics. •Issued by the Department of State as a mimeographed press release. Nov. 18, 1933. "■Issued by the Department of State as a mimeographed press release. Nov. 18. 1933. "Issued by the Department of State as a mimeosraphcd press release. Nov. 22, 1933. '- Issued by the White House as a mimeographed press release, Nov. 24. 1933. Appendix exchange of corp.espoj^dence between secp.etary hughes and mb. BAKHMETEFF, APRIL 28 AND 29, 1922" Russian Embassy, Washington, April 28, 1922. My Dear Mr. Secretary: In view of recent events I think It advKsable to bring forward once more the subject of my position as the representative of Russia In the United States. Received at Washington in July 1917 as Ambassador of the first democratic government of Russia, I have remained at my post up to the present time In order to serve and protect Russian national Interests and to facilitate, in cooperation with the treasury and state departments, the liquidation and final settlement of a large volume of commercial business for which the Government of Russia stood obligated, partly through my agency, to American business concerns. I am happy to believe that American as well as Russian Interests have been served thereby. The work of liquidation has now been brought to a practical close. At the same time my status as Ambassador has been made the subject of renewed discussion. I am led to question whether my continuance, as Ambassador of Russia, will longer serve the best Interests of my country and the convenience of the United States Government. I am prepared If the United States Govern- ment so desires, to retire and terminate my official functions. On account of personal matters I have planned to sail from this country within the near future. It would be necessary to wind up my affairs and to arrange for the custody of the Russian prop- erty for which I am responsible. This work could be completed about the 30th of June, which date could be regarded as the date on which my retirement from official duties would take effect. In the event of my retirement I suggested that Mr. Serge Ughet, financial attache of the Embassy, be recognized as custodian of the properties in question and as the agent through whom pending business can be transacted and terminated. In assuring you of my deep appreciation of the personal con- sideration I have always enjoyed at the hands of the State De- partment, and other Departments of the American Government, I desire to express also my gratitude for the good will and con- sideration with which the United States has treated my country. America was first to welcome the advent of democracy In Russia and to recosnlze the Provisional Government. Since then and throughout Russia's great trial the United States has evidenced deep and sympathetic understanding of Russia's process of trans- formation and has conserved unbroken faith In the regeneration and happy future of the Russian people. The United States has lent friendly effort In preserving for the Russian people the integrity of their national patrimony and In safeguarding their eccncmic freedom. Finally America has generously come to the relief of suffering and saved millions of Ru.sslans from stairation. 'Issued by the Department of State as a mimeographed press release, June' 4, 1922. i I 468 CONGRESSIONAL Pot thU assistance and support In the hour of distress Russja will conserve eternal gratJtude. I avail myself of the oppxjrtunlty to express to you. my de^ llr Secretary, the renewed assurances of my high esteem. B. BaKHMZTCTT. The honorable the SEcarrAST or Stati. Department of State. io and this :o an b e A - this at:d Io we the Uil. of DEPAtTMKNT OF STATS. Wastiinffton. April 29, 1922. Mt Dkas Mr AMBASSADom: I have received your letter of ApiHl ^ 28. 1922. m which you bring forward the question of your statj^s as Ambassador In the United States and suggest that It may appropriate to have this terminate In the near future. Inasmudh a« the liquidation and final settlement of the business of tie Russian Government In the United States for which you we: e respon.<erty of the Russi Government In this country for which you have been responsl will be considered to vest In Mr. Serge Ughet. the Financial tach^ of the Embassy. Mr. Ughet's diplomatic status with Government will not be altered by the termination of your duties and he will continue to enjoy the usual diplomatic privileges Immunities. With assurance of my high esteem and appreciating the friend spirit In which you have dealt with all matters of interest this Government. I am. my dear Mr. Bakhmeteff, Very sincerely yours, CHARL£S E. Hugfies His Excellency Mr. Boris BAKHMETcrr. Amba.isador of Russia. Mr. VANDENBERG. Mr. President, my conclusions muit be obvious from what I have already said. I concede the recognition of Russia is exclusively an Executive func tion and prerogative, and we cannot pass upon it even if would. The President h;is acted in his own right and decision is beyond our recall. That question is not before To be sure, we could decline the confirmation of this Ambas sador. and then we could decline the confirmation of successor if such were our wish: but this would not affecit the fact of recognition, and we would be in the anomalous position of not having a representative of our own to guarp «ur interests in Moscow but of having a representative Moscow in the United States. So that even from my view ^point. were I continuingly suspicious as I have been hereto- fore, certainly there could be nothing gained by an absence of our representation over there while they have complete representation over here. That would be even worse. Therefore it seems to me. in the sheer logic of the case I argue it out to myself and to the Senate, that the act of re<: ognition is complete. It is not a matter upon which Senate can pass. If the Senate were passing upon that am not clear that even now. in the face of these warrant! I would be satisfied to vote in the affirmative. But thing is done; and on the basis of the official record whic is now available to the Senate officially for the first time It is my conclusion that the best possible protection can be put into the words of a contract has been writteh into this agreement between the President and the represent -jative of the Russian Republic. But I should have declined to proceed in the absence of these all-controlling exhibit; i The only remaining question which confronts us is wheth^- Mr. Bullitt is qualified for the position. I confess that he is still somewhat of a mystery man rae. in the language of the Senators from Indiana and Mir nesota. I confess that I still find him al>out as mysterious as the distinguished Senator from Arkansas, the Democratic leader, himself found him in his speech last February. Nev|- ertheless. in fairness, I must state that I was very muc impressed with his presence before the committee. He peared to have a complete grasp of his problem. He appeal^ to be a very able man. At any rate, he is the chosen resentative of the President of the United States, and I no adequate reasons submitted to the committee for opposj- ing this particular evidence of the President s judgment My conclusion is, then, Mr. President, since the official record is now available, and is now part of this considera tion by the Senate of these new Russian-American relation - as the leii. that ap- rep- finl RECORD— SENATE January 11 t3 ships, my conclusion is that as much has been done as could possibly be done to protect us against bad faith and against the jeopardies which heretofore have been feared not only by a majority of Senators but by a majority of the American people. I reserve my Judgment as to the final outcome of the new contact, because everything depends upon the continuity of good faith with which these guaranties are sustained, but in the face of the situation which this develops I shall not oppose the confirmation. It would serve no purpose except to disarm us over there. It would not close the door to their agents over here. Having thus sounded the warnings which it has seemed to me the situation requires, and having critically surveyed the record. I conclude by saying that since we now are to deal with each other in international relations, we should both seek to deserve the other's confidence. Regardless of my personal attitudes toward this amazing and gigantic Communist adventure in the Old World, I share and express the hope of the President that " the relations now established may forever remain normal and friendly and that our na- tions henceforth may cooperate for their mutual benefit and for the preservation of the peace of the world." Mr. ROBINSON of Indiana obtained the floor. Mr. PITTMAN. Mr. President, if the Senator will yield for just a moment while I make an explanation with regard to a subject brought out by the Senator from Michigan. I would like to say that the Senator from Michigan has re- ferred to a request for all the correspondence in this matter. I immediately communicated with the Acting Secretary of State over the telephone. He assured me, as we were as- sured by Mr. Bullitt, that the entire correspondence was covered in this bulletin before us, and that he would imme- diately send it up here, and that he would later certify to us that that was all. I expect that probably there is in my office now a certificate to that effect. Mr. VANDENBERG. Mr. Pi'esident, will the Senator from Nevada, the able Chairman of the Committee on Foreign Relations, permit me to ask him whether he does not think it is highly useful that the basis of this contact should be thus in the cfScial records of the Senate and of the Gov- ernment, so that there can be no question whatever as to what impulses have moved us to surrender our prejudices and consent to this act? Mr. PITTMAN. I am in entire accord with that, but I think that the Senr.tor has made such a clear analysis of not only the motives that move him in this matter but un- doubtedly those which moved the President in the matter, and will actuate me in my vote here, that it is wholly unnec- essary for me to go further in the matter. I will say. how- ever, that in the haste to put the matter into the posses.^ion of the Senator from Michigan and the Senator from Indiana I asked the Secretary to send the matters up immediately. I have requested, further, that for the permanent records of the committee and of the Senate these matters be certified under seal, simply for future information. Mr. ROBINSON of Indiana. Mr. President. I have no de- sire at all to delay action on this question, but this affords the only opportunity one may have in this body to register a protest against the recognition of Russia. It has been said that recognition is a Presidential func- tion, that the President has acted in the matter, and that it is an accomplished fact. That is probably true. The Senate perhaps has no voice in the matter, nor, unfortu- nately, have the American people any voice in the matter. But I think it is well at this time, pureh for emphasis, if for no other reason, to suggest some of the dangers we now encounter in recognizing the Soviets. I shall oppose the confirmation of Mr. Bullitt for two reasons: First in order to express my protest and opposition against Russian recognition in any form; and. second, be- cause in my own mind, after the most dehberate considera- tion. I am convinced that Mr. Bullitt is not the man to act as our Ambassador over there. The chief reason advanced for recognition of Russia is that it will give additional trade advantages which we do 1934 CONGRESSIONAL RECORD— SENATE 469 not now possess. I am frank to say that I do not have much confidence in that view. I am unable to get excited about foreign markets. In normal times the American mar- ket consumes 93 to 95 per cent of all American production. The best year we have ever had, so far as world trade is concerned, was 1928. and in that year less than 6V2 per- cent of all American production was sold abroad. There- fore the problem for us is to restore the American market; and when we restore the American market, we will restore American prosperity, and not before. To restore the Amer- ican market we must take the people off the streets who are now looking for jobs, with none to be found, and give them permanent employment, so that they can puichase Amer- ican coods. Now it is proposed to lend to Russia approximately a half billion dollars. I have no official sanction for that statement, but it has been widely published that a large amount of credit would now be given to the Russians with which to buy our goods. The experience of all other coun- tries has been that the Russians sold far more of their commodities in the market of the country recognizing Russia than they were able to sell to Russia. Russia now owes us some $700,000,000. which remains due and unpaid. If we lend them now a half billion dollars, or any sum. the chances are it will never be repaid, judging the future by the past, and then Russia will have both the goods and the money, and we will be holding the bag. All the goods they send to us, in any event, will just go that much further toward demoralizing the already demoralized American market and v.'ill result in throwing thousands of additional workers in this country out of emplojTnent. Therefore I fail to see v\'here there are any trade advantages to be gained. Italy tried it and, according to an Associated Press dispatch which I quoted here once before, very briefiy, published in the Washington Star: Italy will call a halt on trade with the Soviets after 2 years Her experiences with that country have been unhappy. Italy paid in cash, while Russia paid In credit, running from 9 to 52 months. Russia got the lion's share of the trade, and thereby" chalked up a balance heavily unfavorable to Italy. The dispatch adds: Russia got the lion's share of the trade and Italy Is left holding the bag with a half billion lire In promissory notes. Other coxin- trles have had similar experiences. Mr. President, 1928 was not only our best year so far as world trade was concerned, but it was the best year of all other countries of the world. In that year, for instance, the total amount of world trade aggregated $68,000,000,000. Last year the total world trade amounted to only $28,000,000,000, a reduction of $40,000,000,000 since 1928. I grant that perhaps some of that might be accounted for by the depression, but most of it is accounted for by this fact — that other nations are becoming more self-contained than ever before; and today, while other nations are increas- ing tariffs and raising high embargoes against foreign goods coming in to disturb their own markets, this country, after the idea largely has been abandoned by the rest of the world, plunges further into internationalism than ever before. In other words, world trade has been largely reduced in these latter years. Each nation is becoming more independent and is trying to preserve its own markets. The United States, on the other hand, now seems to become more inter- national-minded than ever before, and opens up her markets to the rest of the world when the rest of the world close their markets to us. That policy will never assist in bring- ing prosperity to this country. Mr. President, I shall say no more on that phase of the qiKstion, There is a very grave matter involved here, however, one that I am very reluctant to discuss, but which I think should be mentioned. If the administration were bound to recog- nize Russia at some time or another, it seems to me it has chosen the worst time in all the world to bring about that recognition. Everyone sitting here today knows the delicate situation in the Far East. We have vast possessions out there, and God knows the American people want no war with any country. The Japanese question Is always dangerous, and I warn Senators here today that it was never more dangerous than at the present moment. I need not suggest to Members of this body that America is not prepared for war with any country; certainly not with a country 9,000 miles from our shores, with a navy better at the moment than oiu-s. and with our possessions lying all around the doorstep of that powerful country. We are not prepared to finance a war with a Budget of over $7,000,000,000 facing us, and a bonded indebtedness within the next year or so of approxi- mately $32,000,000.000 — more than $5,000,000,000 higher than the peak of the war-time indebtedness. Everybody knows how sensitive are the Japanese people. I have been amazed, therefore. Mr. President, that any gesture would be made that might offend them in the slightest degree. Out there are the Philippines, with a problem unsettled by us, which will require years in the settlement. A vast empire that archipelago represents in itself. Seven thou- sand islands and a garrison of 6,000 men — not one man for each island. Under the Washington Conference treaty we are not permitted to fortify anything that we have there. An easy prey to an oriental coimtry or power. There is Guam, but a few hundred miles away, looking to us for protection, and a possession of this country. There is our farthest outpost in the Pacific. Pearl Harbor, in the Hawaiian Islands. 2.100 miles west of San Francisco. And there is Alaska, with its wealth of material resources, thoroughly undeveloped, and fewer than 58,000 people living there — about half native and half American. I point out to Senators that the little island of Attu, westernmost of the Aleutian chain, lies less than 800 miles from Japan and more than 2,800 miles from the nearest continental United States port of Seattle. The Japanese are thoroughly familiar with the great circle route, which they use constantly going back and forth from Seattle to Yokohama, the seaport of Tokyo, traversing Alaskan waters constantly, their naval officers understanding thoroughly all the problems involved in those waters that are but poorly charted, while our Navy has spent little time up there. Newspapers are on the streets this afternoon quoting high Japanese authorities with the statement they are now pre- paring for war against the United States because of the Russian question. I am perfectly willing to concede that it is within the discretion of the President to do as he chooses with execu- tive authority, but I am still unwilling to say that the Senate of the United States has no responsibility in the matter in protecting the rights of the American people. I have a notion that this is one of the gravest responsibilities that ever confronted the Senate. Members of this body, have a care! I recognize that one may easily be charged with being an alarmist, but we have enough trouble on our hands here with the domestic situation without becoming involved in foreign affairs, additional foreign entanglements, possible foreign alliances, and possible foreign wars, which we should avoid as far as possible. I wish to point out also that we have an Asiatic station out there. Vessels of the American fleet make their simMner headquarters at Shanghai and their winter quarters at Manila — an easy prey for a powerful country in the Orient at any moment. Therefore, Mr. President, I think for this very grave rea- son Russian recognition is a terrific mistake, filled with dire possibilities, for the American people that none of us like to contemplate — indeed we scarcely dare contemplate. I there- fore wish to register my opposition against recognition, even though I stand alone. There is another reason, Mr. Prcsidsnt. I shall not ex- plore it at length. It has all been gone over time and again on the floor of the Senate. I have reference, of course, to the fact that the home as an institution, and in which the American people beheve, has been destroyed over there. They have destroyed the right to worship God according to the dictates of one's own conscience over there; and if one were to concede that they have the right to do as they please m^ ft ■■'-'•- 'is >i.^uuut b^au^ auvCkXlUjlgCd WLU^Xi wc UU li i J f 470 CONGRESSIONAll RECORD— SENATE January 11 In their own country, and order their domestic affairs as they see fit. the fact remains that they have no right « foist their ideas and their philosophy on this country. Th it I think, withm the minds of everybody here, is precise y what they have been trying to do throughout the years and will continue trying to do with their subversive propagan^. Another reason is that mentioned by the very able Senati)r from Michigan: The fact that communistic propaganda is wide-spread in this country, emanating from Moscow; aid no matter what promises they may make. Mr. Presider t. the fact remains that they have not kept their word wi h any country during the past 10 years. The experiences of Great Britain, and of France, and of Italy, and of China, and Japan, and of the United States — all are In the same direction. They do not keep their woid. Indeed within the last year one of their most powerful leaders has made the statement that they reserve the right to repudiate their word whenever it suits them or their Interests to do so. '• Sign anything ". they say, in effect. " n order to get advantages for us, but let it be understood thit we will repudiate our word and our signature whenever ve see fit to do so." That is substantially the Russian positidn and the position of their leaders today in their international dealings with other countries. Before I conclude on this phase of the subject, let me siiy that no one is deceived on this proposition. The Third li- ternational and the Soviet system are one and the saire. the Third International has its headquarters in Moscow. It is financed by the Moscow Government, and it will coi- tinue Its propaganda against this country and its institutio is In the future Just indeed as it has done in the past. So I am convinced in my own mind that Russian recognition is utterly inimical to the best interests of the American peop e. I proceed now. Mr. President, to the second reason for riy objection to this confirmation. I want to mention Mr. Bil- litt. Mr. William C. Bullitt has been nominated by tie I President to be our first Ambassador to Russia under the nc w regime. I have no personal animosity against Mr. Bulll t. Let that be understood clearly. I have but the slightest a > quaintance with him. So that anything I say with referen:e to Mr. Bullitt is said in an impersonal sense. I am jist i standing on the record he has made to date. All of us are familiar with his perambulations over Euro )e , within the last 12 months, back and forth from capital to , capital, whispering to this prime minister here and to that j cabinet member there, from one country to the other, pro- I posing reductions in the foreign debts due this country and ! other matters that have leaked out. On this floor on Febr j- ary 2 last, just a few months ago. I quoted from a Univcnal Service cable, which I read now because it has a direct bea r- ing on this man's qualifications: Beklik. February 1.— WUllam C. Bullitt, America t »elf-deacrlbfd secret eaiiamAiy — This was more than a month before the chanre in tie administration here. Most of us thought that Herbtrt Hoover was still President of the United States at that time; yet Mr. Bullitt, representing no one except the Incori- ing administration if his intimations are to be believed, though that was denied by the then President-elect, was | going about Europe Just the same apparently in an of&clal capacity. WiUlam C Bullitt. Amcrira'f wlf^doerlbed aeeret emlMM'y. paid call* tn Ormuin official quarter* here liioiMlajr and then Uitt toT Vienna, It waa learned todajr. Coverln;< hla track-i under an aeeunied name. Bullitt came turn London and Paru, whfM-e he talked with Prime Mlnlater Mic- Donald snd Prenc h Premier Paul-Bonrour. In Berlin he called on Forriirn Mlnlnter Von If«unith and tde chief uf tb« American divuion in the German Porelt^n Office. London and ParU dUpaUhea euu Bullitt deecrlbed hlmMlf In thoae capital* a« a reprt^mtatUe of Pre«ident>elect Rioarvdit, de«tHU Rooaevett'e denial BuJIitl or anyone elae wa« repreaen'.ltig taim. BulKU ref^letered In Berlin under another name and Mked trat h)a prraencc be kept arcr.t. He expreaaed hlmaelf bitterly over «hat he termed the LonUoa " induc;ctluiu " wblcb expoaed liu mlaatoa. Mr. President, a man who goes around in disguise under an assumed name, dealing with various governments abroad with no official credentials himself, certainly is reflecting no credit on this country. The amazing thing to me is that he ever became identified with the State Department, and io soon after Mr. Roosevelt's inauguration. Under a Paris date line of January 27, 1933. is a story reading as follows: Premier Paul-Boncour tonight reluctantly admitted he has dis- cussed the Franco-American war-debt situation with William C. Bullitt. America's self-described secret emissary. He declined to discuss the report that Bullitt had left him con- fidently expecting a Washington Invitation within 15 days to Join In debt negotiations. I do not know that Mr. Bullitt knew what he was talking about over there 2 months, or nearly so. before President Roosevelt came into office, but we all do know as a matter of common knowledge that the invitations were sent out to foreign governments whose representatives came here to discuss the debts. We are all aware of the fact, too. that no sooner had the new administration come into oflSce than this same Mr. Bullitt, who had been traveling around over Europe in disguise and under an assumed name, was given one of the principal oCBces in the State Department. Then came the Russian negotiations, and now, I think to the sur- prise of the American people but not to the surprise of some of us who had followed developments rather closely, he becomes the first Ambassador to Russia under the new administration. Mr. PITTMAN. Mr. President, will the Senator yield? The VICE PRESIDENT. Does the Senator from Indiana yield to the Senator from Nevada? Mr. ROBINSON of Indiana. I yield. Mr. PITTMAN. I am not interested in the newspaper articles, but I think possibly the Senator has made an in- accurate statement in this respect. None of the nations which came here for the informal conference were invited to discuss war debts according to the oflBcial invitation. The invitations were to come and discuss preparations looking to the agenda of the World Economic Conference. I was un- officially invited to all of the conferences that took place. There was once or t^^ice some effort on the part of repre- sentatives of certain governments to raise the debt question, but they were told instantly that matter was not on the agenda and was not subject to discussion. Mr. ROBINSON of Indiana. I thank the Senator for the suggestion. The Senator knows much better than I what took place, because I was not present. I think the general impression was that, among other things, the debts were to be discussed. I am in no position to say that they were discussed to the exclusion of all else, and doubtless what the Senator said is the correct version of the matter. In any event. I think enough indictments can be urged against Mr. Bullitt, because of the record he has made during the past year, to show that he ought not to be named as Ambassador to Russia in these trying times. Within the last few days most of us have seen new.spaper reports — I do not know that they are true, but I have read seme of them, as I assume other Senators have — to the effect that Mr, Bullitt has very recently said that Russia was prepared for war with Japan, that Russia was not afraid of Japan, or something to that effect. It is always dangerous to attempt to quote the language of someone else without the actual statement. I am trying to state substantially what he was reported to have .said. I think that is a grave Indi.scretlon. If it be true that he made any such statement. I do not think he ought to di.icuss the Ru.-'^slan- Japanese matter in any ttenne of the word. It Is delicate enough as It U, Nor do I think we should be drawn into it In any manner. Mr. Presld'^t, th«t h all I have to s«if f^n the nubject. I want to msike it cWpv that I nm opposed to Russian recog- nition In any form. While I have no better means of know- ing how the people ff«?l about it than any other Senator, it is my opinion that the great majority of the American people are opposed to Russian recofnltlon; that If a vote /-«riXTr»T)T70C'Tr\XT A T 'DzrmT>n cttxt ATTT Tamttarv 11 ^■^j ^vruxiuxja 1934 CONGRESSIONAL RECORD— SENATE 471 were to be taken on It throughout the country it would result overwhelmingly against any such recognition. Now that recognition has been accorded, hov.'evcr, by the Chief Executive, it remains for this body to express itself in the only manner it can; that is by a vote on the confirmation of Mr. Bullitt. Because I am opposed to Russian recognition, in the first place, for the reasons stated, and for others I shall not take the time to mention, and because I am opposed to Mr, Bul- litt because of the record he has made during the past year, believing that he is not fitted for the position. I shall vote against his confirmation if a yea-and-nay vote is taken. If no yea-and-nay vote is taken, I adopt tills means of registering my protest. Mr. KING. Mr. President, I apologize to the Senate for detaining them at this late hour. I do so only because on a number of occasions, both in the Senate and elsewhere, I have opposed the recognition of the Soviet Government. The policy of our Govermnent toward Rucsia which was announced by President Wilson met my approval. This policy was stated in an able state paper during the closing months of Mr. Wilson's administration. That policy was followed by Presidents Harding, Coolidge, and Koover. Mr. Justice Hughes, when Secretary of State, in a notable state- ment, supported and emphasized it, and elaborated the rea- Eons upon which it rested. I visited Russia a number of years ago, where I spent sev- eral months and traveled between eight and nine thousand miles in that country. I met many of the leaders of the Bolshevik regime and also mill:oi|s of the Russian people. I stated to a number of those holding oHicial positions in the Soviet Government, that if certain conditions were accepted by that Government, I would favor a policy that would lead to recognition. I regret that the Soviet leaders indicated their opposition to their acceptance. Changes have taken place in Russia since I was there, and particularly during the past 4 or 5 years. President Roosevelt undoubtedly be- lieved the time had come for recognition to be accorded to the Soviet Government. Several months ago it became evident that negotiations would be entered upon between representatives of the United States and the Soviet Government looking to an agreement under which diplomatic relations between the two Govern- ments would be brought about. In view of the position which I had taken in the matter of recognition and the conversations which I had had with representatives of the Soviet Government, when in Russia. I took the liberty of submitting a memorandum to our Government, a copy of which is as follows: No circumstances have arisen to date that would alter my atti- tude heretofore expressed in the Senate and elsewhere on the ques- tion of recognition by the United States of the Soviet Govermnent in Russia. I have always felt the most profound sympathy for the Russian people and have entertained keen regret that they should be subjected to a regime of political and economic dictatorship rep- resented by the present authority In Russia. I have believed that as an American I have no right to Interfere with the Internal, political, or economic affairs established and maintained by another tovcrclgn nation. On the other hand, I have always contended that recognition of a foreign government by our Government Is not a duty nor an obligation on our part but an act of policy dictated by considera- tions which appear to be In our best interest, I supported the position of President Wilson In refusing to rec- ognize the Bolshevik regime and after having visited Russia, where I spent several months and traveled more than 8.000 miles, I was more firmly convinced that the best imprests of our country would not be served by extending recognition to the Soviet Government until and unless that Government should rhan';e Us policy with respect to Internal affairs as well as pxlernal matters, and, more- over, that It shotild give ample and convlnclns? proof of Its Inten- tion to assume In Its International relutloiui a rlrar obMf;ntlon to act In accordance with the generally recognized standards of friendly intercourse among nations. I am, therefore, oppo^d to extending recognition to the Soviet OfM-ernment until such proof la forthcconiitg. If it should become the policy of our Government to reconsider at this time our oflUclal attitude toward the Soviet Oovernrnf-nt, our first step should be the creation of a competent commission to ••certain, both Independently and In consultation v,lth the repre- sentatives of the Soviet Government, the neccsuary facts upon which a judgment can be baaed as to whether or not the Soviet Government is prepared, in fact, to assume international obliga- tions common to all clvUlzed nations. Specifically, before extending recognition to the Soviet Govern- ment, we should know: (1) Whether or not that Government Is prepared to undertake to conduct no subversive propaganda In our country or our Territorial possessions, either directly through its accredited representatives, or indirectly through such an agency as the Third Internationale; (2) whether or not that Government is prepared to and will dissociate itself from the Third Internationale, and will agree to no longer subsidize it or contribute to its mainte- nance or activities; (3) whether or not that Government is pre- pnred to and will guarantee an open, public, and fair trial to any American citizen who may be charged with the violation of any law, rule, or regulation of such Government; (4) whether or n^t that Government is prepared to and will recognize former subjects of Russia who are naturalized American citizens as Americ;\n citizens and will accord to them all the rights of American cltlzwjs; (5) whether or not thrt Government is prepared, with respect to the war loans extended by our Treasury to fully accredited repre- sentatives of the Russian Government then in power, to place itself on the same footing as all the other governments which had borrowed from us during the war — that is, to acknowledge the obligation and to enter into proper negotiations for the discharging of such obligation: and (6) whether or not that Government is prepared to enter into negotiations for the satisfaction of the claims of our citizens who had suffered property damige because of acts initiated and carried out by authority of that Government. The willingness of the Soviet Government to assume the under- takings herein enumerated should be embodied In formal declara- tioiis, precedent to our act of recosnitlon. I will pause to add parenthetically that substantially the conditions to v.hich I challenged the attention of the Presi- dent and the State Department have been, I am glad to say, embodied in the agreements which were entered into. The ex|>erience of other important nations, notably Great Britain and France, which had recognized the Soviet Govern- ment unconditionally, should serve as sufficient warning to lis as to the difficulty of protecting and maintaining our national Inter- ests in the face of the International policies piu^ued by the Soviet Government in the absence of previous clearly defined undertakings on the part of that Government. It is often asserted that recognition of the Soviet Government would result for our country in a large expansion of our export trade to Rusf:ia. ThU. it is held, would be of sufficient benefit to several important branches of agricultural and Industrial produc- tion in the United States to render the act of recognition a step in the direction of promoting our best natioiuil InteresU. The truth of this assertion should be another necessary field of inquiry for the American Commission suggested above. From my personal investigation of thU subject, I am convinced that no foundation whatever exists for the extravagant claims advanced In favor of outstanding trade benefits that would accrue to us as a result of our extending recognition to t^e Soviet Government. The possibility of our purchases from Rvissia, the proceeds of which could be used to pay for ovir exports to that country, is admittedly very limited. Our sales to Russia, over and above our purchases from her, would have to be governed by one of the following factors: (1) A net balance in favor of Russia in her trade with her principal customers, that is, Germany. Great Britain, Italy, and France; (2) exports of gold by her: and (3) new credits extended to her in this country. I am credibly informed that for some time ahead any visible net balance in favor of Russia in her trade with the principal European nations is bound to be absorbed by her payments to these countries on account of credits already extended to her by their citizens: Similarly, her stocks and cxirrent production of gold are relatively smaU. Hence there would appear to be but a slight businesslike basis for the extension to her of any substantial voliune of new credits. ^ .^ ,. All these questions will have to be thoroughly and authorita- tively investigated before adequate judgment can be formed as to whether or not the recognition of the Soviet Government would. In fact be in our best economic interest. Surely no officials of otu- Oovernment would be so oblivious of the disastrous conse- auenrca of our huge loans V3 foreign countries during the post- war years afl to lay the foundation for a resumption of subsUn- , tlal loans abroad without a most careful Investigation as to the I soundness of such Investments. i In short, an unconditional recognition of the Soviet Oovern- ment prior to rn nd^'iuate and authorlUtlve Investigation and unaccompan>d by a definite assumption by the fiovlet Oovern- ; truTit of trustworthy underuklngs along the lines hsre sugirested, ' would be a rash and preclplUU actl«n, likely to be profoundly deplored all too scou after it Is taken, Mr. Pre*ldent. the Prctldent of the United 8tftt«f , a» ha» been to well utatcd by the able Senator from Michigan, and aUo by the Senator from Indiana, undoubtedly ha» th« power under the Con«tltutlon to recognize foreign govern- ment«. Perhaps the time hA« come to change. At any rate, 1 am accepting as a fait accompli the action taken by the Pre»l- y 1QQ/I r.n"Mr:"RF..<5.QiTnM a t . PTrmi^n qt?\t a tt? il'TQ Which ijudimintcMB. ba^aM io wMthjr or »t th. Bovlct | McepUng M * lail accompu UK Kuon vm«n b7 u» r.«r..- I I I 472 CONGRESSIONAL RECORD— SENATE January 11 dent of the United States. Substantially all the guarantl^ I suggested in the memorandum are incorporated in the agreements which have been entered Into. Mr. President, I sincerely hope that the relations betwesn our Govermnent and the Soviet Government will be attend ;d with happy results. For the Russian people I entertain a luKh regard. They possess admirable qualities and capacity for great achievement. Under a liberal and progressive government they will go far and will materially contribi;te to the world's development. Mr. President, in my opinion, the selection of Mr. Bull tt for the post of Ambassador to Russia was most fortunate. I kn©w of no person in the United States that is as well ac- quainted with conditions in Russia and with the officials of the Soviet Government as Mr. Bullitt, and I think Preside it Roosevelt made a wise choice in selecting him. I am sure le will properly guard and protect the interests of our Gov- ernment and will be an important factor in the promotion of friendly relations between the Russian people and tie United States. I shall be pleased to vote for his confirmation. The VICE PRESIDENT. The question is. Shall the Sena te advise and consent to the nomination of William Christian Bullitt to be Ambassador Extraordinary and Plenipotentiary to the Union of Soviet Socialist Republics? The nomination was confirmed. STATS DEPARTMENT DIPLOMATIC AND FOREIGN SERVICE a. The legislative clerk read the nomination of Hal Sevier, of Texas, to be Ambassador Extraordinary a^d Plenipotentiary to Chile. The nomination was confirmed. The legislative clerk read the nomination of Pdst Wheeler, of Washington, to be Envoy Extraordinary a^d Minister Plenipotentiary to Albania. The nomination was confirmed. The legislative clerk read the nomination of George Earle. Sd. of Pennsylvania, to be Envoy Extraordinary a^d Minister Plenipotentiary to Austria. The nomination was confirmed. The legislative clerk read the nomination of Pay A. djes Fortes, of South Carolina, to be Envoy Extraordinary a^d Minister Plenipotentiary to Bolivia. The nomination was confirmed. The legislative clerk read the nomination of Prederifck A. Sterling, of Texas, to be Envoy Extraordinary and Mip Ister Plenipotentiary to Bulgaria. The nomination was confirmed. The legislative clerk read the nomination of Sheldbn Whitehouse, of New York, to be Envoy Extraordinary a^d Minister Plenipotentiary to Colombia. The nomination was confirmed. The legislative clerk read the nomination of Leo R. Sa^k of Pennsylvania, to be Envoy Extraordinary and Minister Plenipotentiary to Costa Rica. The nomination was confirmed. The legialatlve clerk read the nomination of Bert Pish. Florida, to be Envoy Extraordinary and Minister Plenii?|o tentiary to Etypt. The nomination was confirmed. The legislative clerk read the nomination of John v4n A MacMurray. of Maryland, to be Envoy Extraordinary a id Minister Plenipotentiary to Estonia. Latvia, and Lithuania The nomination was confirmed. The legislative clerk read the nomination of Edward 4l bright, of Tennessee, to be Envoy Extraordinary and Mi later Plenipotentiary to Finland. The nomination was confirmed. The leglsLitiVe clerk read the nomination of MatthAw E. Hanna. of Ohio, to be Envoy Extraordinary and Miiiib^er Plenipotentiary to Guatemala. The nomination was confirmed. The legislative clerk read the nomination of W. W. Mt Dowell, of Montana, to be Envoy Extraordinary and Min- ister Plenipotentiary to the Irish Free State. The nomination was confirmed. of 1- The legislative clerk read the nomination of Grenville T. Emmet, of New York, to be Envoy Extraordinary and Minis- ter Plenipotentiary to the Netherlands. The nomination was confirmed. The legislative clerk read the nomination of Arthur Bliss Lane, of New York, to be Envoy Extraordinary and Minister Plenipotentiary to Nicaragua. The nomination was confirmed. The legislative clerk read the nomination of Antonio C. Gonzalez, of New York, to be Envoy Extraordinary and Min- ister Plenipotentiary to Panama. The nomination was confirmed. The legislative clerk read the nomination of Meredith Nicholson, of Indiana, to be Envoy Extraordinary and Min- ister Plenipotentiary to Paraguay. The nomination was confirmed. The legislative clerk read the nomination of William H. Hornibrook, of Utah, to be Envoy Extraordinary and Min- ister Plenipotentiary to Persia. The nomination was confirmed. The legislative clerk read the nomination of James Marion Baker, of South Carolina, to be Envoy Extraordinary and Minister Plenipotentiary to Siam. TTie nomination was confirmed. The legislative clerk read the nomination of Charles S. Wilson, of Maine, to be Envoy Extraordinary and Minister Plenipotentiary to Yugoslavia. The nomination was confirmed. The legislative clerk read the nomination of John H. Mac- Veaeh. of New York, to be consul. The nomination was confirmed. The lenislative clerk read the nomination of A. Dana Hodg- don, of Mai-yland, to be Foreign Service ofiBcer of class 6, a consul, and a secretary in the Diplomatic Service. The nomination was confirmed. The legislative clerk read the nomination of Clayson W. Aldridge, of New York, to be Foreign Service offlcer of class 7, a consul, and a secretary in the Diplomatic Service. The nomination was confirmed. The legislative clerk read the nomination of Walton C. Ferris, of Wisconsin, to be Foreign Service officer of class 8, a consul, and a secretary in the Diplomatic Service. The nomination was confirmed. The legislative clerk read the nomination of John G. Erhardt, of New York, to be consul general. The nomination was confirmed. The legislative clerk read the nomination of O. Gaylord Marsh, of Washington, to be consul general. The nomination was confirmed. The legislative clerk read sundry nominations of secre- taries in the Diplomatic Service. The nominations were confirmed. The legislative clerk read the nomination of Thomas M. Wilson, of Tennessee, to be Foreign Service officer of class 1. The nomination was confirmed. The legislative clerk read the nomination of Graham H. Kemper, of Kentucky, to be consul general. The nomination was confirmed, POST orncE department The legislative clerk read the nomination of William W, Howes, of South Dakota, to be First Assistant Postmaster General. The nomination was confirmed. The legislative clerk read the nomination of Harllee Branch, of Georgia, to be Second Assistant Postmaster General. The nomination was confirmed. rroERAL trade commts.«;ion Tlie Icgl.slatlve clerk read the nomination of James M. Landls, of Massachusetts, to be Federal Trade Commlsaloner. The nomination was confirmed. FEDERAL DEPOSIT INSI7RANCE CORPORATXOIf The legislative clerk read the norainatiou of Walter J. Cummine-s. of Illinois, to be director. I The nomination was confirmed. 1934 CONGRESSIONAL RECORD— SENATE 473 The legislative clerk read the nomination of Elbert G. Bennett, of Utah, to be director. The nomination was confirmed. FARM CREDIT ADMINISTRATION The legislative clerk read the nomination of Albert Simon Goss, of Washington, to be Land Bank Commissioner. The nomination was confirmed. The legislative clerk read the nomination of Francis Winfred Peck, of Minnesota, to be Cooperative Bank Com- missioner. The nomination was confirmed. TREASURY DEPARTMENT — BTJREAU OF INTERNAL REVENTTE The legislative clerk read the nomination of Eldon P. King, of Ontario, Oreg., to be Special Deputy Commissioner of Internal Revenue. The nomination was confirmed. COLLECTORS The legislative clerk read sundry nominations of collectors of internal revenue. The nominations were confirmed. CUSTOMS SERVICE COLLECTORS The legislative clerk read sundry nominations of collectors of customs. The nominations were confirmed. COMPTROLLER OF CUSTOMS The legislative clerk read the nomination of Samuel T. Ladd to be comptroller of customs, district no. 4, Boston, Mass. The nomination was confirmed. DEPARTMENT OF THE INTERIOR The legislative clerk read the nomination of Jessie M. Gardner to be register, land office, Denver, Colo. The nomination was confirmed. COMMISSIONERS OF THE DISTRICT OP COLUMBIA The legislative clerk read the nomination of George E. Allen, of the District of Columbia, to be Commissioner. The nomination was confirmed. The legislative clerk read the nomination of Melvin C. Hazen, of the District of Columbia, to be Commissioner. The nomination was confirmed. PUBLIC HEALTH SERVICE The legislative clerk read sundry nominations for promo- tions in the Public Health Service, The nominations were confirmed. GREAT LAXES-ST. LAWRENCE DEEP WATERWAY TREATY Mr. PITTMAN. Mr. President, I move that the Senate proceed to the consideration of the treaty between the United States and the Dominion of Canada for the comple- tion of the Great Lakes-St. Lawrence deep waterway, signed July 18, 1932, The motion was agreed to, and the Senate, as in Com- mittee of the Whole, proceeded to the consideration of the treaty. Mr. PITTMAN, Mr, President, I ask imanimous consent that a summary of data concerning the pending treaty, which accompanied the President's message sent to the Sen- ate on yesterday, be printed in the Record. The VICE PRESIDENT. Is there objection? There being no objection, the summary was ordered to be printed in the Record, as follows: SuMMAtT or Rkpoits and Data Relativ* to the Obeat Lake»-8t. Lawicnce Project The following pages ■ummarize the reault* of a turvey of the economic anpecta of the proponed Great Lake»-St, Lawrence project. The baalc data are presented In aeparate reports prepared by the agencies cuoperatlng In the survey, constntlng of 2,000 pages of text and tables, Illustrated with charU and maps, THE SEAWAY In order to appraise a project of such magnitude as the pro- posed eeaway, the Investigation was necessarily addressed to answering certain questions: (1» Is the region effected by the project of sufflclent Importance In terms of population, manufacturing output, agriculture, avail- able ports, and trade, to assure a flow of goods via the waterway to and from other areas of economic importance both as sources of commodities and as markets? (2) Are there commodities already moving In and out of the region In quantity, which may be counted upon to move more freely. If the proposed project offers cheaper transportation? (3) To what extent will the proposed waterway open up a new coast line to ocean commerce and in what quantities are com- modities of various classes and descriptions available as potential cargo for vessels using the new route? (4) What savings are likely to be obtained on shipments via the proposed waterway as compared with the cost of shipping via present available routes, and what effect on the economic well- being of the region and the country as a whole may be expected? (5) What work is necessary to complete the proposed waterway and will the cost be Justifled when viewed In terma of the expected savings? (6) In what way and to what extent will the proposed water- way affect other parts of the country and other transportation interests? The reports here summarized provide, as nearly as possible. accurate answers to these questions in terms of facts gathered by Government agencies. The proposed waterway improvement and its cost The Great Lakes-St. Lawrence waterway is already In existence. Its development is not a question of initiating, but rather of com- pleting, a project In the improvement of which the TJnlted States and Canada have whole-heartedly cooperated for generations. The vessels of both countries have navigated its waters freely and with equal rights since the Webster-Ashburton Treaty of 1842. Through- out this entire period it has been in the truest sense an interna- tional highway, unique in the fact that for more than a century no warship has floated in its waters. The United States and Canada have already, with common accord, expended many millions of dollars In its Improvement and It now carries an enormous tonnage even in its most restricted sections. The waterway, which now extends from Duluth-Superlor at the western end of the Great Lakes system to the Atlantic Ocean, a distance of 2,350 miles, has already been Improved to a minimum depth of 21 feet except In the relatively short section of the St. Lawrence River which lies between Prescott-Ogdensburg and Mon- treal. In this 120-mlle section there are now 47 miles of 14-foot canals. This constricted section forms a bottle neck which pre- vents the passage of ordinary ocean-going vessels and makes the port of Montreal virtually the head of ocean navigation and the transshipment point for inbound and outbound commerce. The pending Great Lakes-St. Lawrence Deep Waterway Treaty Is in substance an agreement between the United States and Can- ada to complete the improvement of the existing waterway to pro- vide a minimum depth of 27 feet from the Great Lakes ports to the Atlantic Ocean. The major portion of the work provided for in the treaty be- tween the United States and Canada will be done in the Inter- national Rapids section of the St. Lawrence River, which forms the boundary between the State of New York and the Province of Ontario. Here two great dams will be constructed converting the existing turbulent rapids into deep pools where navigation will be unrestricted. Ocean-going vessels will be passed around these dams by canals having a total length of 10 miles with three locks capable of handling large ocean-going vessels without delay. The dams will also be used to generate 2.200,000 horsepower of electrical energy which wUl be shared eqxially between the United States and Canada. The completed seaway from Duluth to the Atlantic Ocean will provide a waterway in which vessels may move with unrestricted speed over approximately 97 percent of the total distance. The time required for navigation by ordinary cargo vessels is estimated at approximately 9 days. From Chicago to the Atlantic Ocean the distance and time of navigation will l>e very nearly the same. The distance and time of navigation from lake porte farther east wUl be proportionately lese, Full details are given in the eeveral reports «• to tlie barriers which remain to be removed and the works required to complete the seaway. ^ ^. Attention is partlctilarly directed to the fact that, estimating the capacity of the present 8t, Lawrence canal* as about 9,000,000 tons of commerce ann\ially, it appears that the capacity of the ezUtlng waterway is largely absorbed by the commerce of today and that, with the retiu-n of normal conditions, it U likely to be exceeded. In 1928 the traffic on these canals amounted to ap- proximately 8,400,000 tons. ThU may be compared with approxi- mately 10,400,000 tons carried through the Panama Canal in vesseU of less than 25-foot draft In the same year. In 1M9 the traffic through the St. Lawrence canals declined to ieee than 0 000,000 tons but It ha* been steadily Increasing as a reeult of the opening of the new Welland Ship Canal in 1930 to restricted navigation. It would appear, therefore, that the existing 14-foot St. Lawrence canal* must be speedily enlarged, if eerious conget- tlon of commerce I* to be avoided. The annual capacity of the proposed Great Laket-St. Lawrence seaway U conservatively estimated by the Corps of engineers at 25 000,000 tons. In comparing this capacity with tlie tonnage now pasBlnB through the most restricted section of the waterway, it may be noted that the tonnage of the 14-foot St. Lawrence canals increased from approximately 2,000,000 ton* In 19M to 8,400.000 In 1928. This represents an increaee of 830 jDercent during ib» 20 years, or at the rate of approximately 10 percent per annum. It will hardly be questioned that the growth of traffic In the enlarged channels of the seaway will be even more rapid than AUC UVWUlUJitXUU WMB «;vuiii lUCU. I me nommauon was connrmed. able porta, aod trade, to assure a flow of goods via the waterway ' enlarged channels of the seaway will be even more rapia man i 474 CONGRESSIONAL RECORD— SENATE I i January 11 1934 CONGRESSIONAL RECORD— SENATE 475 It has been In the restricted channels of the exUtlng canals. But even on the assumption of the continuance of the past ti*nd, the proposed capacity of the Great Lakes-St. Lawrence seaway would be completely utilized In less than 25 years. The total United States share of the cost of completing this waterway to open the Great Lakes to ocean-going commerce under the treaty Is estimated at $272,453 000. Including the development of 1.100.000 horsepower on the United States' side of the Inte -na- tional Rapids Of this It Is proposed, under the terms of the J olnt resolution which has already passed the House of Reprcsentat ves, tha: »89.726.750 be assumed by the State of New York as repre- senting the cost which may fairly be allocated to the power i roj' ect This would place the total net cost to the United Stateif for the entire project, under the treaty, at »182,726.250. The annual cost of the seaway to the United States, Inclutilng interest at 4 percent, amortization of 50 years, operation and maintenance. Is estimated by the Corps of Engineers at 19.300^000. This amounts to an annual cost of 7 4 cents per capita for the population of the United States and 23.2 cents per capita for the seaway area. The netc seacoast Completion of the Great Lakes-St. Lawrence project will cieate a new seacoast for the United States. 3.576 miles In lengtli of shore line, reaching Into the heart of the Nation and converting 30 American cities located en the Lakes and connecting char ncis Into seaports. As a result. 28 of the 48 States will share In tlie extended coast line of the United States. The following Great Lakes ports, whose foreign and coaatwi.se water-borne commerce In 1931 exceeded 500.000 short tons, may be expected to secure increased water-borne commerce as a resu t of the completion of the seaway: Emiuth. Minn.: Ashland. Green Bay. Manitowoc. Milwaukee, and Superior. Wis.: Calumet and Chicago. 111.: Gary and Indiana Harbor. Ind.; Calclte. Detroit. Bscanaba. Marquette, and Saginaw, Mich.; Ashtabula. ClevclEind. Conneaut. Falrport. Huron. Lorain. Sandusky, and Toledo. Chlo; Krle. Pa.: Buffalo and Rochester. N.Y. Opening up this region which has a capacity of production and consumption comparable with the North Atlantic States iiust result In benefits not only to these ports and their adjoiiing territory but also to the Nation as a whole. The seaway area The seaway area Is defined by a line on the map of the Ut !t«d States bounding the area adjacent to the Great Lakes In wiich transportation costs to and from the markets of the world w 3uld be reduced by the Improvement. This area, on the basis of data In the reports of the Corps of Snglneers. United States Army, Includes the following States In their entirety: Ohio, Indiana. Michigan. Illinois. Wisconsin. Ms- sourl, Iowa, Minnesota. North Dakota, South Dakota. Nebri^ka. and Kansas. It Includes also parts of New York, Pennsylvi nla. Kentucky. Colorado. Wyoming, and Montana. The population of the seaway nrea, exclusive of States only partially Included, was 42.470.045 in 1930. This represents approxi- mately 35 percent of the population of the country. It comdarps with a population of 50.220.680 In the Atlantic area: 19.87^.772 tn the Gulf area: and 10,211549 in the Pacific area. For the Jtast 30 years the population of the area has Increased almost uni- ormly at a rate of 13 percent per decade. If the parts of States not wholly embraced by the seaway area are Included, the papulation to be directly benefited by lower transportation costs totals approximately 45.000.000. This area includes 35 cities of more than 100.000 population. The value of manufactured products in the area In 1929, ex- clusive of thoee States only partially Included, totaled $27.i»40,- 872,000. or approximately 38 percent of the national total. If all the counties of other States Included In the seaway arei. as delimited on the map prepared by the United States Enginpcrs. are included In the seaway area, the combined value of m: .nu- factured products In this area totaled $32,600,499,000 in 192! '. or 46 percent of the total for the United States as a whole, rhls manufact\ire Involved the purcha.se of raw materials of a otal value of $18,277,951,000. or 47 percent of the total value of all raw materials purchased by factories throughout the country. Of the 17 States which lead the country In factory producthm. 9 are wholly and 2 are partially within the seaway area. The agricultural production of the country la also largely sen- tered in the seaway area. The States wholly within the area ion- tain 52 percent of all the crop land. 51 percent of the total >ialue of farm property, 50 percent of the total value of livestoct , 52 percent of the dairy cows. 72 percent of the rwlne, 66 percer t of the butter output, and 49 percent of the egg production. In grain crops this region produces 78 percent of the con , 64 percent of the wheat, and 84 percent of the oats raised in the United States. The wholesale and retail trade In the seaway area affords a 1 >asls for appraising the demand for foreign and domestic Imports. The wholesale trade of the area In 1929 (Includlns; only those States wholly within It) totaled $22,727,535,000 out of a coui try- wide total of $69,291,547,000. If the portions of other Stites. which are within the area, are Included, the total amountel to 136.688306.000. or 38.5 percent of the total for the country is a whole. The retail trade of the area presents the same Impressive pl< ture of a market which will be benefited by the Great Lakes-St. l«w- renoe seaway. In 1929 the retail trade of the area amountel to •10J38.TO1.000. representing 40 percent oX the retail trade of the United Stataa. Importance o/ intercoastal commerce in relation to seaway The predominance of domestic over foreign commerce In the water-borne commerce of the United States is a highly Important factor which must be considered In appraising the effect of the Great Lakes-St. Lawrence seaway on the several coa.st lines and ports Interested directly or indirectly In the development. In the 10 years, 1923 to 1932, Inclusive, the domestic coastwise and intercoastal trade of the country comprised approximately four fifths of the total water-borne commerce. In other words, the volume of domestic commerce was four times as great as that of foreign commerce This is Important because the com- pletion of the Great Lakes-St. Lawrence seaway will render one of the country's greatest economic areas accessible to inter- coastal as well as to foreign water-borne commerce. The predominance of domcsUc commerce over foreign Is not only characteristic of the water-borne commerce of the United States as a whole, but also of the various separate coasts and ports. Thus, in 1930, the ratio of domestic to total water-borne commerce was 82 percent for the ports of the Atlantic seaboard. 70 percent for the ports of the Gulf coast and 84 percent for ports of the Pacific coast. The enormous Great Lakes tonnage is. of course, overwhelmingly domestic (92 percent). It is reasonable to believe, therefore, that at least 80 percent of the new traffic that will be developed by the improvement of the Great Lakes-St. LawTence seaway will be domestic commerce moving between the ports on the Great Lakes and the existing ports on the Atlantic, Gulf, and Pacific coasts. This suggests that the ports on the other coasts will be more largely benefited by the growth of Intercoastal commerce moving via the Great Lake-St. Lawrence waterway than they can be In- jured by changes in the movement of foreign commerce occa- sioned thereby. The Atlantic. Gulf, and Pacific ports, with their already important movement of domestic water-borne commerce, will have the added advantage of direct ocean-trade routes to the new Great Lakes-St. L.iwrence coast serving an area Incom- parable both as a source of products and as a market for the gootis produced In other areas. In other words, if It be granted that some of the Atlantic and Gulf ports may suffer some loss of foreign commerce, which now moves through them by a combination of rail and water trans- portation, this disadvantage would be more than offset by rea.son of the great lncrea.se in domestic commerce with the Great Lakes- St. Lawrence ports which v.dl develop as soon as the seaway Is opened for navigation. Pofcnfial commerce via seoToay The completion of the Great Lakes-St. Lawrence seaway will enable 70 percent of the world's oc?nn-golng frclght-carRO tonnage to reach the Great Lakes and St. Lawrence River ports which serve the important industrial, agricultural, and commercial area de- scribed above. The potential export and Import tonnage which will move via the seaway, based on 1929 conditions. Is conserva- tively estimated In a special study prepared by the War Depart- ment at 13.000,000 tons, and the savings in transportation costs, as compared with present available routes, at approximately $79,000,000. These conclusions rest on the following analysis: The ocean-going merchant marine of the chief maritime na- tions of the world, consisting of vessels of 2,000 tons or over, as of December 31, 1932. totaled 9.358 vessels with a total ton- nage of 51.000.000. Of this total. 6,9.33 vessels with a total tomia^e of 30.000.000 have a draft, fully loaded, of 26 feet or les.s. The freight-cargo vessels Included in the above total 6.707 ves- sels with a total tonnage of 31.000.000; of this total. 5.457 with a combined tonnage of 22,000,000 have a draft, fully loaded, of 26 feet or less. These figures Indicate that approximately 60 percent of the world's ocean-going tonnage and 70 percent of its freight-cargo tonnage can utilize the proposed seaway to promote the conunerce of the interior of the continent. Possible export and Import commerce over the proposed St. Law- rence waterway, based on 1929 conditions. Is estimated at 23,000,000 tons. Certain corrections arbitrarily made In an effort to be con- servative reduce this estimate to a more probable figure of 13,000.000 tons. Potential exports via the waterway Include wheat and grain products, meats and animal fats, manufactured iron, chemicals, automobiles, agricultural implements, and copper. Potential Im- ports Include sugar, rubber and rubber substitutes, coflfee. bananas. kaolin, vegetable oil. manganese, and pyrites. Further analysis reveals that as a whole the potential export and Import trade is fairly well balanced, and that even when broken down on a zone bnsls there is considerable possibility of two-way loading. On the basis on which these estimates are prepared par- tial loading through the St. Lawrence canals, for vessels of greater draft than Indicated by the canal depth, with additional cargo picked up through detour to North Atlantic ports, would be eco- nomically profitable whenever the additional pick-up exceeded 300 tons. An analysis was made of certain commodities which were re- garded as Important potential tonnage for the Great Lakes- St. Lawrence seaway. The present costs of transportation of 8 export and 5 Import commodities were compared with the possible costs that might result through development of the proposed seaway. These savings and the basis for the figures arrived at are shown in detail In the report of the War Department. On the basis indi- cated therein, it Is shown that In 1929 there might have been moved over the proposed seaway a total of exports of 7,741.500 tons with a possible saving of $44,810,923. and an Import movenient of 5,742.333 tons with a possible saving of $34,082,207. It should be noted that these figures are for the year 1929 and are obtained on the basis cf the best possible transportation costs and assuming the most favorable conditions. In the comparisons actual vessel costs were used for both pros- pective seaway and present ocean transportation. Full vessel load- ing was allant capacity to carry a system with a 45-percent-load factor and load curves corresponding with those of the New York Powitr & Light Corporation, the St. Lawrence power plants could ma^-ket nearly 100 percent of their potential primary power output. jThe combination of hydro and steam would provide an annual ou put of 7.333.000.000 kilowatt-hours at a cost, with the steam plants privately owned, of •13.23 per horsepower year or about 4.1 liillls per kilowatt-hour. Similar results were obtained on the assumption that 20d.000 horsepower was sold to lnd\istry near Massena on an 80-perqent- load factor basis and the remainder combined with enough st^am generating capacity to supply a system with 45-percent-load f4ctor 3.000.000 horsepower of firm power. These figures. In conjunction with those In the preceding Isec- tlon. Indicate that in almost any possible combination St. Lawrence power will be cheap power of the greatest possible vilue. Cost of transmission Special studies have been made of the cost of transmitting that portion of St. Lawrence power which will not be used by Indus' rles located near the project. The most exhaustive tectinlcal Investjlga tlon of the problem is that prepared for the Power Authorit the State of New York by E. F. Scattergood. chief electrical neer and general manager of the Loe Angeles Bureau of Power Light. He was assisted in this analysis by engineers who prepared similar plans and estimates for transmitting Boulder Dam p< to Los Angeles. Mr. Scattergood assumes 300.000 kilowatts transmitted to York City over 4 stralght-of-way 220.000-volt transmission cirduits on a double-circuit steel-tower transmission lines from the Lawrence River to Elmsford and four 132-kllovolt underjjrt^i cables of 80.000-kilowatt capacity from Elmsford Into New City. On the above basis, with Interest on transmission investmei^ 4.75 percent the cost of transmission per kilowatt-hour found to be 2 0855 mills at 80-percent-load factor and 2 mills at 80-percent-load factor. The over-all cost of St rence power delivered in New York City on this basis would 4 81^ mills at 80-percent-load factor and 5.0833 mills at percent -load factor. Comparison with other studies suggests a considerable reduction in the cost of land assumed In this study. If. in addition. tinderground tran^mis&lon into New York City is eliminated, following conclusions as to the cost of transmitting St power over a publicly owned transmission system appear t^ be conservative : (1) St. Lawrence power can be transmitted to southern York, a distance of approximately 300 miles, with allowance transmission losses, approximately 22 mills at 60-percent- factor and 1.6 mills at 80-percent-load factor. (2) St. Lawrence power can be transmitted to the Utlca a distance of 135 miles, with allowance for transmission for approximately 0.97 mill at 60-percent-load factor and mill at 80-percent-load factor. On the basis of the above conclusions the total cost of Lawrence power delivered at the end of the 300-mlle line would be 4 20 mills at 60-percent-load factor and 3 13 at 80-percent-load factor. The corresponding figiires for dellkrery m the Utlca area would be 2.99 mills at 60-percent-load factor 2.24 mills at 80-percent-load factor. These calculations are based upon the assumption that transmission system is used solely to carry St. Lawrence p Actually, if it Is combined with other generating stations, as gested above, there will be a cerUin amount of relaying of j._ In both directions, tending to reduce the cost of transmission These figures indicate that St. Lawrence power can be available within a wide area at sa low a cost as to renderl Its development an essential step in providing for the power require mante of the region. It is an economically sound project qottx Lawn -nee Hew for oad laises. transmlailon 070 368 840 000 178 .92 .54 Of efagl- and ired wer 'Jew lits St. nd tork at was 7806 liaw- be 60- the the I rea, ises. 0.73 St. on ihllls irery and the pother. ower. Broadly speaking, it may be said that every one of these trends is upward and that the prospect is for a greater demand for power by 1940 and 1950 than the conservative estimates below will f ore c Ast Population growth In the United States as a whole has been analyzed by Thompson and Whelpton In their book. Population Trends in the United States. Based on an extensive analysts of vital statistics they project growth ahead, at a diminishing rate to 1980. Examination of the figures and curves for New York State indicates an almost exact correspondence with the rates of Increase for the country as a whole. Extension 'of the New York curve on this basis suggests a pop- ulation increase of 2,150,000 or about 17 percent from 1930 to 1950. If the per capita use of electricity in the State remained static, this Increase in population would create a new demand for about 2,500,000,000 kilowatt-hours. The per capita use of mechanical power in the country, however, is steadily Increasing, and with It has gone a continuing Increase In the proportion of that power derived from central electric gen- eration stations. In New York State from 1920 annual production of electricity more than doubled, the per capita output rising from 667 kilowatt- hours to 1,163 kilowatt-hours per year. Although the depression brought a slight hesitation in the upward trend, 1933 figures show that it has been resumed. A chart plotted to indicate the trend Indicates a probable per capita production of electricity In New York State of 1,740 kilo- watt-hours in 1940. The assumption of a population of 13.840.000 In 1940 as fore- cast nbove and a per capita demand for 1,740 kilowatt-hours In the same year would require provision for generating 24,081,600,000 kilowatt-hours in the State In that year. This would mean an increase of nearly 10,000,000,000 kilowatt-hours over the previous high point, or about twice the estimated output of the proposed St. Lawrence power plants at 100-percent-load factor. Electrification of the home Probably the most important factor In the growth of the market for the electrical energy is the increasing use of electricity in homes. This Is recognized by the industry itself and is being pro- moted as the best way of building a stable load. The act of the New York Leglslattire creating the Power Au- thority of the State of New York to undertake the power project is specifically designed to secure the lowest possible rates for do- mestic and rural consumers In order to encourage the fuller use of electricity In the home and on the farm. Prom 1920 to 1930 the number of residential lighting customers in the United States increased from 6,700,000 to 20,149,352. The steady upward trend in the number of residential customers in the States within the St. Lawrence power area corresponds with that in the country as a whole. In New England the number in- creased from 778,300 in 1920 to 2.234,947 in 1930. while in the Middle Atlantic States the Increase was from 1,509,000 to 6,895,089. The increase in the domestic market for electricity appears in the Edison Electric Institute compilation showing distribution of electrical energy by classes of consumers. From 1930 to 1932 the increase in residential use proceeded without interruption from 2,950,000,000 kilowatt-hours to 11,987,000,000 kllowatt-houra. Av- erage annual use per customer Increased from 339 kilowatt-hours In 1920 to 601 kilowatt-hours in 1932. The present trend in average residential use suggests at least 841 kilowatt-hours per customer in 1940 and 1,103 per customer in 1950. But such a forecast takes no account of the possibility that material reductions in present domestic rate schedules are likely to occxu" with a resulting major stimulus to the use of electrical appliances. Such a change in the most Important single factor affecting the trend would unquestionably cause domestic consumption to approach the average usage prevailing in Ontario. It may be pointed out, however, that an Increeise in average domestic usage to 1.100 kilowatt-hours a year, coupled with an in- crease in the number of customers paralleling the Increase in population, would more than double the present domestic market for electricity in New York State. It would mean an added de- mand for more than 1.800,000,000 kilowatt-hours per year. Electrical appliances promise expanded market for power The electrification of the home is becoming more and more a matter of expansion in the use of electrical appliances. The as- surance that this trend will continue affords a secure foimdatlon for predictions that the market for power by 1940 will not only easily absorb but will positively require St. Lawrence power. In 1921 the residential use of electricity was still predominantly for lighting, and the amount of power consumed by appliances was negligible. By 1932, however, domestic electric appliances were consuming over 57 percent of the electric power sold to resi- dential customers. It Is important to note that In spite of the serious depression the number of electric refrigerators Increased from 1,860,000 to 4,220,000 in 2 years. As the electric refrigerator consumes an average of 600 kilowatt-hoiurs a year, this increase of 2,360,000 meant an expansion of 1,460,000,000 kilowatt-hours in the demand for electric power. Similarly the expansion of 220,000 In the number of electric ranges meant a market for an additional 605,- 000,000 kilowatt-hours, so that the increase in the number of these two appliances alone meant a new demand for over 2 billion kllowatt-hovirs of electrical energy. Rural electrification will provide added market An Important phase of the expansion of the residential market for electricity will unquestionably be the extension of rural elec- trification, involving both the connection of a larger proportion of ftu-ms with central electric stations and use of electricity to perform more functions of the farm and rural home. Recent years have witnessed a steady increase in the number of farms in the St. Lawrence power zone which receive electric service. The figures show that from 1923 to 1932 in the New England and Middle Atlantic States the number of farms receiving electric service has increased by nearly 250 ijercent. But this increase In rural electrification does not mean that the limits of the farm market are even being approached. The possibility of Increasing the number of rural families receiv- ing electric service In New York State has been investigated by the New York Public Service Commission. The study showed that: (1) At least 60.000 of the 100,000 farmers not yet receiving elec- trical service deserved consideration as potential electric cus- tomers, even though there should be no change In the technlc of the electrical Industry or in the status of rural electrification. (2) The ready adoption by farmers of such appliances as elec- tric milk coolers, milking machines, incubators, etc., indicates that the farm consumption of electricity is increasing rapidly and will continue to do so if properly encouraged. ^^ ., (3) Some New York farmers were already finding It profitable to use from 1.000 to 1,500 kilowatt-hours per month. (4) If electrical service were brought to the remaining economic farm units in the State, and if all farms were equipped with such appliances as they could economicaUy use, the annual electric consumption by the farms of the State would amount to at least 300 000 000 kllowatt-hovu-s, an increase of nearly a quarter of a billion kilowatt-hours in this field of electrical usage alone. Electrical indiLStry forecasts growing market for power The electrical Industry has set as a goal for domestic consump- tion 1,000 kUowatt-hours per customer In 1936. according to a recent statement by the commercial director of the Edison Elec- tric Institute. To accomplish this the Industry expects to supple- ment the growing use of electric refrigeration with an active development of electric cooking and electric water heating. On the basis of figures showing the extent of saturation In the appliance market. Mr. C. M. Ripley, electrical engineer of the General Electric Co.. estimated. February 3. 1932. that there wa» moted as the best way ol Duiiaing a sLaoie loaa. \J1SX*IGA Ck« AiU^^r « 478 CONGRESSIONA u^es H05 o; publlcatj on by In on s 5 be I les |d- B. ; a n ' the ' Jixly dema nd Increi ae. Increyise of 193 3 000 )• >e- tal5 of expan« on 7^k In by puU for Ic for Ihe 80 ohal Sta tes to stb- shirc resale ow est contrnicts of all that £nd d4ta. on g(!n- 4nd s dies poi ?er mu- ch ir- c(in- Goveriior b« nt he he • potential market for appllancea In the homes of the UnH ed | State* -iifflcient to Increase domestic consumpUon of electricity by 48 000.000 000 kilowatt -hours. Tl^e General Dectrlc Co has Issued a number of documents load building which describe In some detail the various new of electricity One of these estimates that by the autumn of an additional 4 300 000 kllouatts of generating capacity will nqulred to meet the country's Increased demand. It Indicates the Importance or anticipating the growth of load and of prov tng the necfssary generating capacity to meet the requlremerits Another reflection of the electrical indiiatry's anticipation "* - gromlng market for electric power Is to b« found In a entitled "Load and Revenue Forecasting" autharlied opt-rattng committee of the Edison dectrlc Institute 1933 Some of the conclusions as to future growth In for power may be quoted from this report, as follows: •• Energy consumption per customer will continue to but at a somewhat faster rate In all probability. This Is very consutent through good tlm^ and bad. and admits rather accurate forecast The saturation point is not In slfi nor Is It predictable. It has been pointed out that, at the present development of appliances, the poaslble consumption is 10 kilowatt-hours per customer (Electrical World. Jan. 7. 1^ Even this amount cannot be taken as the saturation point cause new applications of electricity In the home will raise figure • • • " It is evident that there Is an enormous expansion ahead us. • • • It Is evident that the domestic load will eventually •■■ume enormous proportions in Its demand on the distribution system " These authoritative forecasts of the electrical Industry Itsflf tending to support the conclusions derived from analysis of trends In the production and consumption of electricity, present Incontrovertible evidence that the market for St. Lawrence po^^er will be ready before the project Itself can be completed. Op Ing In accordance with the purpose laid down for It by the " York Legislature. Its Influence in the direction of lower domestic and rural rates will be a force tending to promote this In the market for electricity. Statua of St. Lawrence poveer projeet under the lava of Neto The St Lawrence power project of the SUte of New York provided for in chapter TJ3 of the Laws of New York, approved the Oovemor. AprU 27 1981. TTil.i act was the fruition of 25 years of effort to provide development of 8t I.awrence power by the State in the Interest Licenses had been sought by private corporations the right to exploit the power resources In the Internattotal ttspidi* section, but such applications were rejected by both St ' and Federal agencies. Section 5 of the art spectflcally directed the power authority " to cooperate with the appropriate agencies and officials of United States Government to the end that any project und^r taken " by the tru«te«v - "shall be consisti !it with and In aid of the plans of the United States for the Improvement of commerce and navigation the St. Lawrence River, and shall be so planned and constructed as to be adaptable to the plans of the United States therefor that the necessary channels, locks, canals, and other navigat facilities may be con.structed and installed by the United In, through, and a.s part of the said project." Section 5 directed the trustees to "'develop, maintain, manage, and operate' the project and make provision so that muuiclfwlitles and other political divisions of the State • • • may secure a reasonable f>f the power ° ' subjsct to conditions which shall assure the of such power to domestic and rural consumers at the low|est poAslhle price.' " A formula was set up by this act to which any made with prU-nte companies for transmission and distribution current must conform The act specifically provided for (at Pull and complete disclosure to the power authority of factors of cost in transmission and distribution of power, so rates to consumers may be fixed Initially in the contract may be adjusted from time to time on the basis of true co6t o6sible for benefit of the consumers cf electricity in this State. " Pending the final settlement of this problem, I repeat recommendation made to you last year, that you adc^t legl^»' RECORD— SENATE January 11 tlon to permit municipalities of the State, after approval by a referendum vote, to purchase and sell elertrlclty developed from the St. Lawrence River. Municipalities will In this way be able to buy cheap electrlcltv. and at the same time be given a potent weapon with which to compel existing publlc-utUity companies to provide them with electricity at rea.sonable rates." The evident intent and effect of the laws of New York pro- viding for the St. Lawrence power project has been the pro- vision of a yardstick on electrical cojts and rates for the benefit of the constimers of current and for the protection of the public against unfair charges. The development of the St. Lawrence by a public agency rep- resents the last opportunity available to provide the northeastern section of the United States with the benefits assured other sec- tions through development of Muscle Shoals, Boulder Dam, the Columbia River, and similar public projects. CONCLUSIONS The studies Independently made by the various agencies lead to the conclusion that the Great Lakes-St. Lawrence project for power and navigation should be undertaken without delay. The navigation project Is comparable in economic value and Importance to the Panama Canal. It is combined with the de- velopment of the largest and cheapest block of hydroelectric f>owcr available in North America. Undertaking of the project will provide employment on essen- tial and self-liquidating public works during the immediate period of conatriictlon. Its completion will unquestionably con- fer important national benefits and stimulate the future growth and development of the United States. RECESS Mr. ROBINSON of Arkansas. I move that the Senate take a recess until 12 o'clock noon tomorrow. The motion was agreed to, and (at 5 o'clock and 30 min- utes p.m.) the Senate, in executive session, took a recess until tomorrow. Friday, January 12, 1934. at 12 o'clock meridian. CONFIRMATIONS Executive nominations confirmed by the Senate January It, 1934 ASSIST.'lNT SECRtTARIES OF STAT« R. Walton Moore to be Assistant Secretary of State. Francis Bowes Sayre to be Assistant Secretary of State. AlCBASSADORS EXTRAORDINARY AND PLENIP0TENT.\RY William Christian Bullitt to be Ambassador Extraordinary and Plenipotentiary to the Union of Soviet Socialist Re- publics. Hal H. Sevier to be Ambassador Extraordinary and Pleni- potentiary to Chile. EInvoys Extraordinary and Ministers Plenipotentiary Post Wheeler to be Envoy Extraordinary and Minister Plenipotentiary to Albania. George H. Earle, 3d, to be Envoy Extraordinary and Minis- ter Plenipotentiary to Austria. Fay A. des Portes to be Envoy Extraordinary and Minister Plenipotentiary to Bolivia. Frederick A. Sterling to be Envoy Extraordinary and Min- ister Plenipotentiary to Bulgaria. Sheldon Whitehouse to be Envoy Extraordinary and Min- ister Plenipotentiary to Colombia. Leo R. Sack to be Envoy Extraordinary and Minister Plenipotentiary to Costa Rica. Bert Fish to be Envoy Extraordinary and Minister Pleni- potentiary to Egypt. John Van A. MacMiuray to be Envoy Extraordinary and Minister Plenipotentiary to Estonia, Latvia, and Lithuania. Edward Albright to be Envoy Extraordinary and Minister Plenipotentiary to Finland. Matthew E. Hanna to be Envoy Extraordinary and Minis- ter Plenipotentiary to Guatemala. W. W. McDowell to be Envoy Extraordinary and Minister Plenipotentiary to the Irish Free State. Grenville T. Emmet to be Envoy Extraordinary and Min- ister Plenipotentiary to the Netherlands. Arthur Bliss Lane to be Envoy Extraordinary and Minis- ter Plenipotentiary to Nicaragua. Antonio C. Gonzalez to be Envoy Extraordinary and Min- ister Plenipotentiary to Panama. Meredith Nicholson to be Envoy Extraordinary and Min- ister Plenipotentiaxy to Paraguay. 1934 CONGRESSIONAL RECORD— HOUSE 479 William H. Homibrook to be Envoy Extraordinary and Minister Plenipotentiary to Persia. James Marion Baker to be Envoy Extraordinary and Min- ister Plenipotentiary to Siam. Charles S. Wilson to be Envoy Extraordinary and Minister Plenipotentiary to Yugoslavia. Secretaries in the Diplomatic Service Bertel E. Kuniholm Robert Y. Jarvis Richard S. Huestis W. Quincy Stanton Stanley G. Slavens Whitney Young Robert F. Fcrnald John C. Shillock, Jr. James W. Gantenbein Norris B. Chipman John L. Bouchal Consuls General John G. Erhardt O. Gaylord Marsh Consul Graham H. Kemper John H. Mac'Veagh Foreign Service Officers, Consuls, and Secretaries in the Diplomatic Service A. Dana Hodgdon Clayson W. Aldridge 1 Walton C. Ferris Foreign Service Officer, Class 1 Thomas M. Wilson Assistant Treasurer Marion Glass Banister to be Assistant Treasurer. Assistant Register of the Treasury BjTd Leavell to be Assistant Regi.stcr of the Treasury. Superintendent or the Mint Mark A. Skinner to be superintendent of the mint, Den- ver, Colo. Assayer in the Mint Bruce B. LaFoUette to be assayer in the mint, Denver, Colo. Assayer in Charge of the Mint Hugh T. Rippeto to be assayer in charge of the mint. New Orleans, La. First Assistant Postmaster General William W. Howes to be First Assistant Postmaster Gen- eral. Second Assistant Postmaster General Harllee Branch to be Second Assistant Postmaster General. Member of the Federal Trade Commission James M. Landis to be a member of the Federal Trade Commission. Members of the Federal Deposit Insurance Corporation Walter J. Cummings to be a member, board of directors. Federal Deposit Insurance Corporation. Elbert G. Bennett to be a member, board of directors, Fed- eral Deposit Insurance Corporation. Members of the Farm Credit Administration Albert Simon Goss to be Land Bank Commissioner. Fiancis Winfred Peck to be Cooperative Bank Commis- sioner. Special Deputy Commissioner of Internal Revenue Eldon P. King to be Special Deputy Commissioner of Internal Revenue. Collectors of Intern.al Revenue Carter H. Harrison to be collector, first district of Illinois. Seldon R. Glenn to be collector, district of Kentucky. Clinton A. Clauson to be collector, district of Maine. Joseph P. Carney to be collector, district of Massachusetts. Thomas J. Sheehan to be collector, first district of Mis- souri. Dan M. Nee to be collector, sixth district of Missouri. Peter M. Gagne to be collector, district of New Hamp- shire. James J. Hoey to be collector, second district of New York. Frank Scofield to be collector, first district of Texas. Nathaniel B. Early, Jr., to be collector, district of "Virginia. Collectors of Customs Service Alfred A. Cohn to be collector of customs, district no. 27. Raymond Miller to be collector of customs, district no. 47. Howell Cone to be collector of customs, district no. 17. John H. Dooley to be collector of customs, district no. 1. Fountain Rothv/ell to be collector of customs, district no. 45. Adrian Pool to be collector of customs, district no. 24. I. Walke Truxtun to be collector of customs, district no. 14. Margaret M. IiIcQuilkin to be collector of customs, district no. 48. Comptroller of Customs Samuel T. Ladd to be comptroller of customs, district no. 4. Register of Land Office Jessie M. Gardner to be register, land office, Denver, Colo. Commissioners of the District of Columbu George E. Allen Melvin C. Hazen Public Health Service promotions Omar C. Hopkins to be passed assistant sanitary engineer. Fortunat A. Trole to be surgeon. Carl E. Rice to be surgeon. Edward R. Marshall to be medical director. Emil Krulish to be medical director. Chapman H. Binford to be passed assistant surgeon. John A. Trautman to be passed assistant surgeon. Joseph A. Bell to be passed assistant surgeon. Edward C. Rlnck to be passed assistant surgeon. Gordon A. Abbott to be passed assistant surgeon. Sidney P. Cooper to be passed assistant surgeon. George W. Bolm to be passed assistant sm-geon. Elmer T. Ceder to be passed assistant surgeon. Waldemar C. Dreessen to be passed assistant surgeon. Noka B. Hon to be passed assistant surgeon. Otis L. Anderson to be passed assistant surgeon. Claude D. Head, Jr., to be passed assistant surgeon. Benjamin E. Holsendorf to be passed assistant pharmacist. Lon Oliver Weldon to be senior siu-geon. Howard Franklin Smith to be senior surgeon. James Gayley Townsend to be senior surgeon. William Howard Slaughter to be senior surgeon. Joseph Bolten to be senior surgeon. LeGrand B. Byington to be surgeon. HOUSE OF REPRESENTATIVES Thursday, January 11, 1934 The House met at 12 o'clock noon. The Chaplain, Rev. James Shera Montgomery, D J)., offered the following prayer: Our merciful Heavenly Father, there are no shore lines where Thou art. Even the wings of the morning are not mighty enough to carry us beyond Thy sheltering provi- dence; somewhere and everywhere in all this old world is Thy mothering heart; we praise Thee. We beseech Thy wisdom and grace to help us to be spiritual architects, build- ing upon those foundations that never give way. O let the temples of our immortal souls rise higher and higher and without the sound of a hammer. Do Thou manifest Thyself in all our works and keep us In touch with the teeming daily human life which is always unfolding itself before our open eyes. Amen. The Journal of the proceedings of yesterday was read and approved. RULE FOR consideration OF INDEPENDENT OFFICES APPROPRIA- TION BILL, 1&35 Mr. BANKHEAD. Mr. Speaker, at the request of the Chairman of the Committee on Rules, the gentleman from Mon rriMnPFSSTONA T, RF.rORD— HOUSE January 11 1934 CONGRESSIONAL RECORD— HOUSE 481 •• Pending the flnal ■ettlem«nt of tills problem. I repeat the recommendation made to you last yefur, that you adopt legU !» Meredith Nicholson to be Envoy Extraordinary and Min- ister Plenipotentiary to Paraguay. VV,^ V\y h^^r v^^/* Peter M. Gagne to be collector, district of New Hamp- shire. Mr. BANKHEAD. Mr. Speaker, at ine reQuesi oi too Chairman of the Committee on Rules, the gentleman from 480 CONGRESSIONAL RECORD— HOUSE January 11 u- hlU Id the on he is North Caroltna. T call up for consideration House Reso tlon 217 and ask that the same be reported. The Clerk read as follows: Houae Resolution 217 Resolved. That during the consideration of HJl. 6663. a making appropriations for the Executive Office and sundry Inile- pendent bureaus, boards, commissions, and offices, for the flfical year ending June 30. 1935. and for other purposes, all points -' order agnlnst title 11 or any provUlona contained therein hereby waived: and no amendments or motions to strike out stall be in order to such title except amendment* or motions to strike out offered by direction of the Committee on Appropriations, ind said amendment* or motions shall be In order, any rule of t House to the contrary notwithstanding. Amendments shall not In order to any other section of the bUl HJl. 6663 or to any section of any general appropriation biU of the Seventy-third Congress which would be In conflict with the provlaions of title II of he bill HJl. 6663 as reported to the House, except amendments offered by direction of the Committee on Appropriations, and ^ amendments shall be in order, any rule of the House to contrary notwithstanding. Mr. SNELL. Mr. Speaker. I reserve a point of order the rule. Under this reservation I wish to ask the chaim^n of the committee a question. Mr. BLANTON. Mr. Speaker, so we may know what t point of order is. I demand the regular order so that ihe point of order may be made. Then he can ask his questi|)n. We should like to know what the point of order is. Mr. BANKHEAD. Mr. Speaker, I yield to the gentlen^n from New York to state his point of order. Mr. SNELL. I ask the chairman of the committee if i intended under the provisions of this rule, which is ^ot drawn entirely in the usual maimer, to take advantage under the peculiar wording of it to refuse to the minority the rij ht to make the usual motion to recommit? Mr. BANKHEAD. If the gentleman from North Carol na [Mr. Pou] will allow me to answer the gentleman's questi)n. I may state this rule does not prevent a motion to recomn lit. Mr. SNELL. Does it prevent the usual motion to ;e- commit? Mr. BANKHEAD. I do not know what the gentleman means by the usual motion. Mr. SNELL. That is just the point I wish stralghtered out at this time. I mean the usual motion that is made to recommit a bill, where the minority have a right to lut their position on pending legislation before the House foi a vote, as is usually provided in and carried in every special rule that has ever been presented on the floor of the Hoise. in language of the following import; " Except one motion to recommit." Mr. BANKHEAD. I may state to the gentleman from ^ ew York that this rule, as the gentleman will understand by reading it — and we may as well be candid about it in he very beginning Mr. SNELL. We may as well be in the beginning of t lis discussion. Mr. BANKHEAD. I think it is always best. I may st ite to the gentleman that the rule as provided in this resciu- tion does not prevent a motion to recommit the bill to he Appropriations Committee. Mr. SNELL. Does the gentleman mean we cannot muke the usual motion to recommit, which states the position of the minority in regard to the legislation? Mr. BANKHEAD. If the gentleman desires a categorical answer to his question. I may say that, in conformity with the spirit and purpose of this rule, to protect the attitude of the Committee on Appropriations and what I believt is the attitude of the administration on this question, a sim pie motion to recommit to the committee would be in orper under this rule. Mr. SNELL. And nothing except the motion to recomn^it? Mr. BANKHEAD. Let me state it again, so there will no doubt about it. Mr. SNELL. Mr. Speaker. I make the point of order against the rule that it is not a privileged report from the Ccm- mittee on Rules, on the ground that it violates the general rules of the House by denying the right to the minority make the iisual and regular motion to recommit. be to The SPEAKER. The Chair will hear the gentleman from New York. Mr. SNELL. Mr. Speaker, as far as I am familiar with the rights of the Committee on Rules to make privileged reports, they are entitled to report a rule at any time, with the two exceptions, and these exceptions are specifically set forth in section 725, page 327, of the Manual: The Committee on Rules shall not report any rule or order which shall provide that business under paragraph 7 of rule XXIV— Which is the Calendar Wednesday rule — shall be set aside by a vote of less than two thirds of the Members present — The next exception covers the point I am making in my point of order — nor shall it report any rule or order which shall operate to pre- vent the motion to recommit being made as provided in paragraph 4 of rule XVI. Paragraph 4 of rule XVI states the following: After the previous question shall have been ordered on the pas- sage of a bill or Joint resolution, one motion to recommit siiall be in order. Also rule XVII, section 1. provides — It shall be In order, pending the motion for or after the pre- vious question shall have been ordered on Its passage, for the Speaker to entertain a motion to commit with or without Instruc- tions to a standing or select committee. It has been the precedent of the House for a great many years that under no circumstances will the minority be pro- hibited from making a motion to recommit, and I have yet never heard anyone express a different opinion on policy or philosophy of the rules of the House. In this way the minority is allowed to place its position before the Conjrress, and. if enough Members approve of it. they are entitled to a roll-call vote. I have never heard anyone take a different position on the floor of the House. But it is evident, from what the gentleman from Alabama says, that they intend, by the particular wording of this rule, to take advantage of the situation and to deny the minority the right of making such a motion. For this reason I maintain the rule is sub- ject to the point of order. Mr. BLANTON. Mr. Speaker, will the gentleman yield for a question? Mr. SNELL. Yes. Mr. BLANTON. The motion to recommit does not permit anything in it that is not in order under a bill. Mr. SNELL. I did not say that it did. Mr. BLANTON. This rule merely shows what is in order under this bill. A motion to recommit to the committee can well be made. Mr. SNELL. The gentleman does not understand at all the point I was arguing. Mr. BLANTON. This is the crux of the whole thing. This is the same kind of a rule we had under the Johnson legislation. Mr. SNELL. The gentleman never saw a rule like this during his membership in this House. Mr. BLANTON. We had a rule to suspend all rules under that Johnson veterans' legislation on June 26, 1930. Mr. SNELL. I do not remember what he makes reference to, but I know we have never pa.ssed a rule that denies the right to the minority to make the usual motion to recommit. Mr. BLANTON. A rule which was so tight you could not change the dotting of an '" i " or the crossing of a "■ t." Mr. SNELL. The gentleman still does not understand the point of my argument at all. Mr. BLANTON. There is no point to it. Mr. O'CONNOR. Mr. Speaker, will the gentleman yield? Mr. SNELL. I yield. Mr. O'CONNOR. I am afraid the gentleman is confused, and honestly so. This is not a rule for the reporting of a bill which would carry the usual provision that there should be the right of a motion to recommit. Mr. SNELL. Yes. Stop right there for a moment. 1934 CONGRESSIONAL RECORD— HOUSE 481 Mr. O'CONNOR. This Is a rule pertaining to a matter in a bill. The bill comes before the House by privilege, coming from the Committee on Appropriations. Therefore no rule is needed in order that the bill may be considered. This rule is directed to points of order against a certain provision in the bill. Now, the gentleman said that under the rules all rules from the Committee on Rules should contain a provi- sion permitting a motion to recommit. Mr. SNELL. I do not think that is absolutely necessary, although it is generally carried. We will not argue that point. Mr. O'CONNOR. Rule XI itself gives the right to recom- mit whether or not anything is said in the special nile Itself. Mr. SNELL. Yes; but the gentleman from Alabama said frankly that he expected to limit the motion to recommit the bill to the Appropriations Committee to a motion to recommit without any instructions whatever. This is defi- nitely against the rules of the House and the whole philoso- phy and precedents on which the rules are founded. Mr. BANKHEAD. Has the gentleman concluded his state- ment? Mr. SNELL. Yes; I have concluded my statement for the present. Mr. BANKHEAD. In reply to what the gentleman from New York said, the matter now pending before the Speaker for decision is on a point of order reserved by the gentle- man from New York, to wit. that the rule reported and now pending violates the standing rules of the House with ref- erence to a motion to recommit a bill. There is nothing in this rule, as I stated to the gentleman before, that would deny to any Member a motion to recommit the bill. There is nothing in this rule that would prevent any Member from offering a motion to recommit on any other phase of the bill except that covered by title n. As I stated to the gentleman, we might as well put all the cards on the table now as hereafter, because this will come up if the rule is adopted as a matter of parliamentary construction. Mr. SNELL. That is the reason I brought the matter up at this time. Mr. BANKHEAD. There is no reason for equivocation about that. The purpose of this rule, if we have the votes to adopt it, is to protect, as I stated to the gentleman, the integrity of title n of the pending bill in toto. Under this rule, if adopted, a motion could be made to recommit to the Appropriations Committee. A motion could be made, and would be in order, to recommit with instructions as to any other item or items in the bill not covered by title n. But it is my opinion, and I think the Chair would so hold, that a motion to recommit with instructions affecting matters under title II would not be in order. Mr. BRITTEN. Will the gentleman yield for a question? Mr. BANKHEAD. I yield to the gentleman from Illinois. Mr. BRITTEN. As I understand it, there are a number of gentlemen on both sides of the aisle who would hke to vote for a return to the old-salary basis. The gentleman has repeatedly referred to title II without qualifying his remarks. I am asking the gentleman for information at this time. Many of the Members on the floor of the House do not know what title n encompasses. It may cover many things in many different directions. Is not the rule intended to de- Uberately prevent a vote on the question of returning to the old -salary basis that we had before March 4 of last year? Mr. BANKHEAD. The gentleman may vote against the bill if he so desires. Mr. BRITTEN. Yes; but then a motion cannot be made to recommit, with instructions to the committee to bring back another bill based upon old salaries. Mr. BANKIHEAD. I stated that to the gentleman. Mr. BRITTEN. But the gentleman did not state it clearly. Mr. BANKHEAD. I stated it very clearly. I believe the gentleman from New York understood it. I am not responsi- ble for the understanding of the gentleman from Illinois in all cases. Mr. Speaker. I ask for a decision. Mr. KVALE. Will the genUeman yield? Mr. BANKHEAD. For what purpose? Mr. e:vale. For the purpose of asking a question. Mr. BANKHEAD. Yes. Mr. KVALE. The rule applies also to all other appro- priation bills that are to be brought in at this session, does it not? Mr. BANKHEAD. It applies to all other appropriation bills that may be brought in at this session if there is an attempt made to affect the provisions covered by title n of this bill. In other words, allow me to state to the gentle- man from Minnesota the naked fact with reference to It. These are the views of the majority leadership in this House, and I am not putting myself in that category because I am a mere private in the ranks, and of the President of the United States, as I understand it, and I think this will be explained to the House by the chairman of the Committee on Appropriations. The purpose of this whole controversy here today is to have the House deliberately determine for today and hereafter during the remainder of this session whether or not they are going to follow the President's recommendations or not. [Applause.] Mr. BLANTON. That is the point, whether they are with him or against him. Mr. BANKHEAD. The purpose of this rule is to get the sentiment of the House as it affects the economy bill, or whether they are going to pursue some other policy and the gentleman is right in the construction of the rule, as indi- cated by the query he has submitted. Mr. SNELL. I am not going to take any exception to the statement made by the gentleman from Alabama except to this one effect. I have no objection to the Democrats iu this House following the President of the United States, but we have a right to demand that they follow him accord- ing to the prescribed rules of the House of Representatives of the United States. [Applause.] I know that the in- terpretation they are putting on this rule is contrary to the spirit of the rules of this House and to every precedent of the House in the last 20 years. I have not been able in the short time I have had to find many decisions, but I want to call the Speaker's attention to a decision by Speaker Gillett, found at the bottom of page 328 of the Manual, which reads as follows: The Committee on Rules cannot report a rule which la aimed strictly or directly at overthrowing Calendar Wednesday or the motion to recommit. There is another decision by Speaker Cannon and one by Speaker Clark. Mr. O'CONNOR. Read the balance of the sentence. Mr. SNELL. That is not in point here. There is also a decision by Speaker Clark along the same line, which I will put in later, because I cannot turn to them at the present time; but I want the Speaker to understand that I am making the point of order that the provisi(His of this rule are not in conformity with the philosophy of the rules of the House, do not carry out intent and purpose of the rules, and are directly opposed to the precedents, the decisions, and practices of this Houae. BtTLINCS BT BPEAKESS CLAKK AND CAWNOH Where a special order provided for the appointment of conferee* " without any intervening motion ". It was held to exclude the motion to Instruct conferees, but not the motion to recommit On August 16, 1912 (62d Cong.. 2d aeas.. Congussional Record. p. 11042) the House agreed to a resolution making It In order to take the post office appropriation bUl from the Speaker's table. disagree to Senate amendments, and ask for a conference. It was further provided that on the adoption of the resolution the Speaker should appoint confereea " without any intervening motion." Mr. Mann moved to commit the bUl to the Committee on the Post Office and Poet Roada with inrtructlonfl to that committee to report it back forthwith with the reconunendation that Senate amendment no. 118 be agreed to. Mr John A. Moon, of Tennessee, made the point of order that the special order by which the bill was taken from the l^>etkker'« .-if •S-? ^m Lxxvm- -31 482 CONGRESSIONAL RECORD— HOUSE January 11 1934 CONGRESSIONAL RECORD—HOUSE 483 ruica ui lilt; riuu:>c uy uriijriiiK Liic iigiiu tu ixic uiiiiuj.ii.j« make the usual and regular motion to recommit. tu uc liic ii^iiL Ui a uiuuuii uu reuuiiuiixi/. Mr. SNELL. Yes. Stop right there for a moment. |i f 482 CONGRESSIONAL concu] motloc table niTvcntwl the siibml«ilon of Intervening motlona. IncUiding the motion to recommit, and demanded the Previous question^ The speaker read the liwt sentence of section 1 rule XVII. anc decided ^CoNca»>»s.oNAL Record, p 11089» that ",6 special ordei could not abrogate th.s provlaiop. and reccgnlzed Mr. Mann t. Mr John Dalzell. of Pennsylvania, from the Committer! on nules, repjrt.'d the following resolution: Kr-olied. That when the bill (HR. 32010). 'An act to create tariff board.' shall have been received from the Senate the Speake; nhdll immediately, without regard to pending business, lay 1» before the House, and thereupon the previous quc»llon shall bi conKldered ai ordered on a motion to concur in the Senate amend merit/* in krrorji * , Mr Plt/Kerald moved to commit the Senate amendments to tnortlng resolution couched In general terms which may directly ban that ultimate result, such as a resolution providing for 6 days' sus- pension of the rules. 1 Applause. 1 Mr. SNELL. That has no reference to the question. Wa a minute, and do not holla too soon, and do not give thje rebel yell, for it is bad precedent in the House of Repre sentatives. Mr. BLANTON. It is a darned good yell. Mr. SNEXL. It probably was 75 years ago, but it Is n(^t today, and it is poor form to raise it here. Mr. BANKHEAD. Mr. Speaker, do I still have the flooi The SPEAKER. The gentleman from Alabama has be^n recognized. Mr. SNELL. Will the gentleman yield to me so that may answer the gentleman from New York? Mr. BANKHEAD. II the gentleman will not interject aijy outside remarks. Mr. SNELL. If the gentleman will control the Membets I on his side I will endeavor to do so on my own side, but vfe are not going to allow the rebel yell and not reply Mr. MAPES. Mr. Speaker, on a point of order, I subniit that the gentleman from Alabama does not have the flocr. Mr. BANKHEAD. Mr. Speaker. I yielded to the gentle- man from New York and not to the gentleman from Mich|i gan. Mr. MAPES. Mr. Speaker. I make the point of ordfer that the gentleman from Alabama does not have the flojr on a point of order, and the gentleman from New York h is the floor by recognition of the Chair on the point of ord( r The SPEAKER. The Chair recognizes the gentleman frcm New York. Mr. SNELL. I simply want to say in reply to what the gentleman from New York I Mr. O'Connor] has said thit the reference he read referred to rtiles suspending the rules during the last few daj's of the regular session, and t le point I make is that it is not in order to bring in a rile which directly or indirectly keeps the minority from offering the usual motion to recommit. RECORD— HOUSE January 11 X Mr. MAPES. Mr. Speaker, may I say just a word on the point of order? The SPEAKER. The Chair will hear the gentleman. Mr. MAPES. I have as much respect for the opinion of the gentleman from Alabama on points of order and inter- pretations of the rules of the House as any other Member of the House, but I should like to submit to the Speaker that the gentleman's interpretation of thli rule is not neces- sarily binding upon the Speaker. The SPEAKER. The Chair knows that. That is not a point of order. The Chair is ready to rule. Mr. MAPES. If the Chair is ready to rule The SPEAKER. The Chair does not need such instruc- tions. Mr, MAPES. Of course. Mr. Speaker, I was only saying that preliminary to what I intended to say about the rule, and I thought it wa« pertinent. The SPEAKER. Does the gentleman de»lro to dUcu»» the point of order? Mr, MAPE«, I thought It ww«i prrtlncnt to what I was Koinu to Hwy ubout ihr* rult^. but If the Mp^akcr dorn not care to hear me, thut in n\\ nuht, I1ii? HHEAKER. Tht' Himikfv will be pli'aM'd to huar the gentUman duciWN the? point of order, Mr. MAPES. I was about to way I did not feel that the Interpretation of the gentleman from Alobama of this rule was either correct or binding upon the Speaker; but If the Speaker accepts the Interpretation of the rule as given by the gentleman from Alabama as being correct. It seems to me that he must sustain the point of order as raised by the gentleman from New York; but, for myself, I do not agree with that interpretation. The rules of the House of Representatives are very specific and definite about motions to recommit, and I submit to the Speaker that it is dangerous to hold that a rule like this, which makes no reference to the motion to recommit, re- peals or does away with the rule giving the minority the right to make one motion to recommit. Nothing is said in this rule about a motion to recommit. It says only that no amendment to title II of the bill can be made except upon motion made by the Committee on Appropriations, and it is reading more into this rule than the language itself contains for the Speaker or for the gen- tleman from Alabama to say that it prevents the usual mo- tion to recommit. The rules of the House are so sensitive in sustaining the right to make a motion to recommit in the regular way that it seems to me the Chair 'A'ould not be justified in holding that a rule of this kind repeals or nulli- fies the standing rule with respect to the motion to recommit. The SPEAKER. The Chair is prepared to rule. The gen- tleman from New York makes the point of order that the Committee on Rules has reported out a resolution which vio- lates the provisions of clause 45, rule XI, which are as follows: The Committee on Rules shall not report any rule or order • • • which shall operate to prevent the motion to recommit being made as provided in clause 4, rule XVI. The pertinent language of clause 4, rule XVI is as follows: After the previous question shall have been ordered on the pas- sage of a bill or joint resolution one motion to recommit shall be in order and the Speaker shall give preference in recognition for such purpose to a Member who is opposed to the bill or resolution. The special rule, House Resolution 217, now before the House, does not mention the motion to recommit. There- fore, any motion to recommit would be made under the general rules of the House. The contention of the gentle- man from New York that this special rule deprives the minority of the right to make a motion to recommit is, therefore, obviously not well taken. The right to offer a motion to recommit is provided for in the general rules of the House, and since no mention is made in the special rule now before the House it naturally follows that the motion would be in order. »ot roNORESSIONAL RECORD— HOUSE January 11 gentleman from New York imderstood it. i am not responsi- i uw apeciai oroer dj wmtn Lxxvm 31 WTII *,xvut iiiJK iay^^M» 1934 CONGRESSIONAL RECORD— HOUSE 483 A question may present itself later when a motion to recommit with instructions is made on the bill H.R. 6663 that the special rule which Is now before the House may prevent a motion to recorrmiit with instructions which would be in conflict with the provisions of the special rule. It has been held on numerous occasions that a motion to recommit with instructions may not propose as instructions anything that might not be proposed directly as an amend- ment. Of course, inasmuch as the special rule prohibits amendments to title II of the bill HJR. 6663 it would not be in order after the adoption of the special rule to move to recorrunit the bill with instructions to incorporate an amendment in title II 0/ the bill. The Chair, therefore, holds that the motion to recommit, as provided In clause 4, rule XVI. has l>een reserved to the minority and that Insofar as such rule la concerned the special rule before the House does not deprive the minority of the right to make a Klmplc motion to recommit. The Chair thlnki, however, that ft motion to recommit with inMtructlonN to incorporate a pro- vision which would be In violation of the special rule, Houm Iic»;olutlon 217, would not be in orAer. For the rt7a»onii ittttpd, ihp Chair ovcrrulr-M the point of order, Mr, SNELL, Will ilie Chair allow m« to make % pAflia- mentttry inquiry? The SPEAKER. Certainly, Mr, SNELL, Do I undertttand from the ruling of the Chair the minority will be allowed to oiler the uiual motion to recommit? Tlie SPEAKER. The usual simple motion to recommit provided by the rules. Mr, SNELL. Mr. Speaker, as much as I dislike to do it, I appeal from the decision of the Chair. The SPEAKER. The gentleman from New York appeals from the decision of the Chair. The question is, Shall the decision of the Chair stand as the judgment of the House? Mr. SNELL. And on that, Mr. Speaker, I ask for the yeas and nays. The yeas and nays were ordered. The question was taken; and there were — yeas 260, nays 112, answered " present " 4, not voting 54, as follows: (Roll No. 78] YEAS— 260 Adair Adams AUgood Arnold Auf der Helde Ayers. Mont. Ayres. Kans. Bailey Bankhead Beam Belter Berlin Blermana Black Bland Blanton Bloom Boehne Boland Boylan Brennan Brooks Brown. Ga. Browning Brunner Buchanan Buck Bui winkle Burch Burke, Calif. Burke. Nebr. Busby Byrns Cady CaldweU Cannon. Mo. Garden. Ky. Carmlchael Carpenter. Kans. Carpenter, Nebr. Cartwrlght Cary Castellow Celler Chapman Chavez Church Clark. N.C. Cochran. Mo. Coffin Colden Cole CoUlns. Miss. Colmer Cooper, Tenn. Cox Cravens Crosby Cross. Tex. Crosser, Ohio Crowe Cullen Darden Dear Deen Delaney De Rouen Dickinson Dicksteln Dies Disney Dobbins Dock well er Doughton. N.C. Doxey Drewry Driver Duffey Duncan, Mo. Durgan. Ind. Eagle Edmlston Elcher Ellzey, Miss. Faddls Farley Fleslnger Fitzgibbons Fltzpatrlck Flannagan Fletcher Ford Prey Puller Fulmer GambrUl Gavagan Gillespie Gillette Glover Go' ds borough Granfield Gray Greenwood Gregory Grlffln Griswold Haines Hamilton Hancock. N.C. Harlan Barter Hastings Healey Henney Hill, Ala. Hill. Knute Hill. Samuel B. Howard Huddleston Hughes Imhofl Jacobsen Jeffers Jenckes, Ind. Johnson, Okla. Johnson, Tex. Johnson, W.Va. Jones Keller Kelly, m. Kenney Kerr Kleberg Kloeb Koclalkowski Kopplemann Kramer Lambeth Laixxneck Lanhais Lanzwtts Larrabee Lea. Calif. Lehr Lewis. Colo. Lindsay Lloyd Lozier Ludlow McCarthy McClintlc McCormack McDuflle McFarlane McGrath McKeown McMillan McReynolda MrSwaln Marland Martin. Colo. Martin, Oreg. May Miller MlUlgan Mitchell Monaghan, Mont. Montague Montet Moran Morehead Murdock Mu.^sel white Nesblt Norton O'Brien O'Connell O'Connor Oliver, Ala. Oliver, N.Y. Owen Parker Parks Parsons Patman Petersen Pettengill Peyser Sandlln Btruuc Tex. Vtterbaek Pierce Schaefer Studley Vinson. Ga. Polk Schuetz Sullivan Vinson. Ky. Pou Schulte Sumncrs. Tek. Walter Ramspeck Scrugham Su^>hln Warren Randolph Sears Swank Wearln Rankin Secrest Tarver Weaver Rayburn Shallenberger Taylor. Colo. West. Ohio RelUy Shannon Taylor, S.C. West. Tex. Richards Slrovlch Terrell. Tex. White Richardson Sisson Thom Whlttlngton Robertson Smith. Va. Thomason WUcox Robinson Smith. Wash. Thompson, ni. Win ford Rogers. N.H. Smith. W.Va. Thompson, Tex. Wnilama Rogers. Okla. Snyder T-.-uftX WUson RudU Somers, N.Y. Turner Wood. Oft. RufPn Spenre Umstead Tsfoodrum Banders Steagall Underwood Young NAY&— iia Allen Darrow Jenklnx. Ohio Reed. NT, Andrrwfl, W,T. Dr Priest Johumjn. Minn. Rich ArenH Dlrknen Kahn Rotters. IIms. Barh«riieta Ditter K«lly, r«. Seller Bwon t>7t>d#ro KiOMir Hlmpaon nAk«w»n Doiitrlrh, P«. Ktiutmn lllri/m»>ll KurlK Mtu'll Hr^rty KaUitt KVMl# Mt^ikM HifttMihard fcltft*, Calif, LAititMftauA UlruiMt, P(k. ffollfKU KfiKlci'rltftit l4t>mki> Awlck lutiutn Kvatm LmiinAkI Tulief Hrillwn run Lur* Tairltir, Tflta. ToWy Brutitm ViMtM l,uiui»pn hui Kijp« tiitm umuiai'n Tra#i«»f Hurithftin YruM Mooutfin Tread way Cartor, Calif, OlfTord McUan Tiirpm Carter, Wyo, QllchrUt MapM Waldron Cavicchla Ooodwln MarBhall Wallgren Chawi OOM Martin, fttoM. Weldeman Chrutlaniion Ouyer Meeka Whitley Clarke, N.Y. Hancock, N.Y. Merrltt Wlgglettwortb Cochran, Pa. Hartley Millard Wllhrow ColltnB. Calif. Higglns Mott Wolcott Connery Hoeppel O'Malley Wolfenden Connolly Holmes Peavey Wolverton Cooper. Ohio Hooper Powers Wood, Mo. Crowther Hop)e Ransley Woodruff Culkin James Reece 2Uoncheck ANSWERED " PRF-SENT "—4 Claiborne Condon Dunn Maloney. Conn NOT VOTINO— 54 Abernethy Poulkes Lehlbach Sabath Andrew. Mass. Gasque Lewis Md. Sadowskt Brown, Ky. Green McLeod Shoemaker Brown. Mich. Green way Maloney. La. Stalker Cannon, Wis. Hart Mansfield Stubbs Carley. N.Y. Hess Mead Sweeney Corning Hildebrandt Moynihan, HI. Terry, Ark. Crump Holdale Muldowney Thurston Cummings Hollister Palmlsano Tlnkham Dlngell Kee Perkins Wadsworth Douglass Kennedy. Md. Prall Welch Edmonds Kennedy. N.Y. Ramsay Werner Ellenbogen Knlffin Reid. 111. Fernandez Lee. Mo. Bomjue So the decision of the Chair was sustained as the Judg- ment of the House. The following pairs were annotmced: On this vote: Mr. Mansfield (for) with Mr. Wadsworth (against). Mr. Carley of New York (for) with Mr. Muldowney (against). Mr. Mead (for) with Mr. Andrew of Massachusetts (against). Mr. Douglass (for) with Mr. Hess (against). Mr. Sweeney (for) with Mr. Edmonds (against). Mr. Kniffln (for) with Mr. Hollister (against). Mr. Prall (for) with Mr. Lehlbach (against). Mr. Crump (for) with Mr. Welch (against). Mr. Green (for) with Mr. McLeod (against). Mr. Gasque (for) with Mr. Reid of Illinois (against). Until further notice: Mr. Abernethy with Mr. Perkins. Mr. Hart with Mr. Moynihan of niinols. Mr. Palmlsano with Mr. Thurston. Mr. Lewis of Maryland with Mr. Stalker. Mr. Fernandez with Mr. Tinkham. Mr. Brown of Kentucky with Mr. Shoemaker. Mr. Maloney of Louisiana with Mr. Stubbs. Mr. Ramsay with Mr. Holdale. Mr. Kennedy of Maryland with Mr. Brown' of Michigan. Mr. Warner with Mr. Cummings. Mrs. Greenway with Mr. Kee. Mr. Cannon of Wisconsin with Mr. Terry of Arkansas. Mr. Sadowskl with Mr. Lee of Missouri. Mr. Hildebrandt with Mr. DingeU. Mr. Romjue with Mr. Poulkes. Mr. DOCKWEILER. Mr. Speaker, my colleague, Mr. Stubbs, is ill, but desires me to say that il he were present he would vote " aye." '.*?- ■# '•»v-/l *-'Jl 1934 CONGRESSIONAL RECORD— HOUSE 485 the usual motion to recommit. motion would be in order. m CONGRESSIONAL RECORD— HOUSE January 11 Ml colleague, Mr. Hart, is Mr TRUAX. Mr. Speaker, my colleague. Mr. Swkeney Is unavoidably detained at home, but if present he woule discussed in the consideration of the rule, we ha^|e had a tacit agreement with the minority members of the committee that debate may extend for 3 hours, to be cor fined to the resolution. In view of that agreement, I ask unanimous consent, Mr. Speaker, that the time for the di! cussion of the resolution now pending be confined to 3 hours, one half of which shall be controlled by the gentleman from Pennsylvania !Mr. RansletI and one half by myself, ard that at the conclusion of the 3 hours the previous questiqn on the resolution shall be considered as ordered. Mr. RANSLEY. Debate to be confined to the rule. The SPEAKER. The gentleman from Alabama asts unanimous consent that debate upon the resolution be con- fined to 3 hours, one half to be controlled by the gentlem4n from Pennsylvania (Mr. RansleyI and one half by himse at the conclusion of which time the previous question sh^ll be considered as ordered. Is there objection? Mr. OMAI.I.EY. Mr. Speaker, reserving the right object — and I shall not object — I ask whether those on t Democratic side who may not be in favor of the rule will given som.e time from the control on the Democratic side? Mr. BANKHEAD. I say very candidly to the gentleman that I have requests for more time than I can dispose now from tho^e who are in favor of the resolution. Mr. O'MALLEY. In other words, we will have to go to t to 16 other side to get a chance to record our opinion of the rue Mr. BANKHEAD. Under the circtmistances I regret |to say that I think that will be necessary. Mr. CONNERY. Mr. Speaker. I reserve the right object. Do I understand that no one who is opposed to tl^is rule has asked the gentleman from Alabama for time? Mr. BANKHEAD. I did have requests from two or thifee Memtjers on this side who asked for time in the discussion of the rule. Those on this side generally are in the afflrmp t:ve for the passage of this rule. Mr. CONNERY. But the gentleman had requests from one who is against it? Mr. BANKHEAD. Those on the other side control t time on that side, for those who are opposed to the rue There are several members of the Committee on Rules w lo ordinarily are entitled to the privilege of speaking, and |in to le )e of 10 tie view of the peculiar nature of this question most of the t.me in the discussion of this rule will be allotted to the members of the Committee on Appropriations. I say to the gentle- man from Ma.ssachusetts (Mr. Conner y] that that conclu- sion has not been reached as a matter of discourtesy or as a penalty to any Members on this side of the aisle who may be opposed to the rule, but I think it is consistent proDably with the situation which confronts us. The SPEAKER. Is there objection? Mr. RANSLEY. Mr. Speaker. I reserve the right to ob- ject. Thoi;e of us on this side of the House are perfectly agre^'able to the division of the time of an hour and a half on a side, but on the matter of the previous ques- tion being considered as ordered there cannot be an agree- ment so far as that is concerned. The SPEAKER. Does the gentleman object? Mr. SNELL. I suggest to the gentleman from Alabama that he modify his request and put it without the previous question. The gentleman from Pennsylvania objects to the previous question portion of the request, although he does make the request that debate shall be confined to the bill as well as the rule. Mr. BANKHEAD. As the gentleman from Pennsylvania well knows and as the gentleman from New York well knows, of course we would have only 1 hour for the discussion of this rule. Mr. SNELL. I aprreciate that, but as the gentleman from Alabama says, this is the crux of the whole matter. Mr. BANKHEAD. We wanted to accommodate the op- position by some liberality of debate. Mr. SNELL. I tharik the gentleman. Mr. BRITTEN. Does that mean that debate will be limited to the bill as well as the rule? Mr. BANKHEAD. It will be limited to the resolution, and. of course, that would permit discussion of the merits of the bill itself. Does the gentleman object to the unani- mous-consent request? Mr. RANSLEY. I object to the previous-question portion of it. Mr. BANKHEAD. That means that the gentleman ob- jects to the request. Mr. RANSLEY. Then I shall have to object to that. The SPEAKER. Objection is heard. The Chair recog- nizes the gentleman from Alabama. Mr. BANKHEAD. Mr. Speaker. I modify the request, and ask unanimous consent that the debate on the resolution be confined to 3 hours, one half of which shall be controlled by the gentleman from Pennsylvania and one half by myself. I The SPEAKER. The gentleman from Alabama asks ' unanimous consent that debate extend for 3 hours, one half to be controlled by him.self and one half by the gentleman from Pennsylvania [Mr. RansleyI. Is there objection? Mr. BANKHEAD. The original request was that the de- bate shall be confined to the bill or the resolution. The SPEAKER. Debate to be confined to the bill or the resolution. Is there objection? Mr. PARKER. Mr. Speaker, I asked for 3 minutes to discuss this rule, and I was not given that privilege. There- fore I object. The SPEAKER. Objection is heard. The gentleman from Alabama [Mr. Bankhead] is recognized for 1 hour. Mr. BANKHEAD. Mr. Speaker, I regret that the gentle- man from Georgia objects. Of course I have no control over his conclusions at all, but I ask the gentleman to con- sider the situation, that by making his objection he is cut- ting off 2 hours of general debate upon the merits of the resolution. Mr. O'MALLEY. What particular advantage is it to dis- cuss it for 2 hours more? Mr. BANKHEAD. Mr. Speaker, I yield 5 minutes to the gentleman from North Carolina IMr. Pou], Chairman of the Committee on Rules. Mr. POU. Mr. Speaker. I ask to be permitted to make a very brief statement without interruption. On March 4, 1933, the President of the United States took the oath of office. When the President of the United States took that 1934 CONGRESSIONAL RECORD— HOUSE 485 oath of office at that time, he found the country had de- scended to the lowest point, economically speaking, in all its history. He immediately set to work to present to the country a program which he hoped would have beneficial results. During the last session of Congress, time and again, we passed through this House resolutions from the Com- mittee on Rules, which had for their purpose the putting through of his program. This rule which the House is now being called upon to consider cuts off all amendments from title II of the bill, waives all points of order, and for its effect requires of the House either a vote up or down of the entire title II. Title II is a part of the program of the President of the United States. It has often been designated as the heart of his program. Speaking for myself, I shall not undertake to fire a shot at the program of my own President by even offering to amend title II. The Committee on Appropriations is asking for this reso- lution. It is the hope of the. administration, so I am in- formed, that the House will sustain the request of the Com- mittee on Appropriations. We might as well face the is.sue here and now. Franklin Roosevelt's program has already produced vast results throughout the Nation. A blind man can see that there has been a tremendous improvement since March 4. So far as I am concerned, I have no apology to make for supporting this rule. It is a simple test, as to whether or not we are going to hold up the hands of our great Presi- dent. He is asking that his program, which was partially put in effect during the special se.ssion of Congress, be con- tinued by virtue of the action of the House on this resolution. I have supported the program of a number of Presidents, if you will pardon a concluding personal word. I supported Theodore Roosevelt in his naval program; I supported Woodrow Wilson, the great. I am winding up 33 years, gentlemen, a good long time. My brethren of the House of Representatives, I say to you here and now, that never dur- ing those 33 years have I supported any policy of any man with as much enthusiasm and as much satisfaction as I now support that of Franklin D. Roosevelt. (Applause.] The SPEAKER. The time of the gentleman from North Carolina [Mr. Pou] has expired. Mr. RANSLEY. Mr. Speaker, I yield such time as he may desire to the Republican leader, Mr. Snell. Mr. SNELL. Mr. Speaker, I have no controversy with the statement made by my distinguished friend the gentleman from North Carolina [Mr. Poul. I understood that the ma- jority would support the President, but my contention has been so far here today — and I want to reiterate it — that I demand you support the President in accordance with the rules and precedents of the House of Representatives. [Ap- plause.] You have evidently decided not to follow those rules or precedents, as a result of sustaining the decision handed down by the distinguished Speaker of this House, which, although I dislike to say it. is the most unfair, the most ruthless decision that has been handed down since I have been a Member of this Congress, and that has been 20 years. On the morning of December 21 I was very pleased to read in the Washington Post, in large headlines, the follow- ing: BTRNS OPEKS MOVE TO JUNK HOUSE GAG DEMOCRATS ENLIST C.O.P. AID TO END TACTICS OF LAST SESSION House Democratic leaders are planning to junk unprecedented gag-rule procedure employed to rush the President's emergency program through the last session of Congress. Relying on scattered Republican pledges of " cooperation " and a safe Democratic majority. House Democratic strategists hope to abandon " legislation by rule " at the January term, discarding the great body of gag precedents built up last spring. In large headlines the folloicing: WILL NOT NEED RULE " In the first place. I don't think we will need the special rules we were forced to bring out last session ", Representative Joseph W. Btrns (Democrat), of Tennessee, said last night. •• In the second place — I want you people on the majority side to get this — ** I don't approve of the principle and never did." [Applause.] I was still further pleased to read in the Washington Post on the morning of December 26, 1933, the following: HOUSE LEADER PLANS SUPPLT BILL RETORM — BUCHANAN HITS PRACTICE OP TACKING LAWS ON APPROPRIATIONS OKMOCRATS EXPECT MORE 8PEEDT ACTION WFTH SIMPLER PROCEDURE Reforms in House procedure on the 11 big appropriation bills, Umltlng the supply measur'>« more strictly to the orlgiuai pur- pose of providing funds for the operations of the Govcrnmeut. will be sought thl."5 session by House Democratic leaders. Representative James P. Buchanan (Democrat) Texas, Chair- man of the House AppropriatlonH Committee, told the Post last night he hopes to eliminate the previous practice of writing general legislation into appropriation bills to expedite the passage through both Houses. " Only where the White House speciAcally asks that legislation be handled in this manner will we use the supply blUf. fur legis« latlve purposes ", Chairman Buchanan said. "Approjjrlatlon bills should be regarded altogether as supply measures. In recent years we have been using them too broadly I for legislation. 1 intend to stop the practice if I can." I That is the statement that the Democratic leaders of this I House gave to the country at large 2 weeks before the session met. When I read that statement in the paper, I made up my mind that I was about in the same position as a poor half- breed, pack-basket lumberjack man up in my country in the spring of the year. The man that I especially have in mind was Napoleon Lavine. They always called him " Old Pete." One day I met Old Pete in the road after he had been down to settle up for his winter work. I said to Pete, " Well, Pete, how did you get along?" He said, " Mr. Snell, I tell you the truth. When I go down and go Into that store. Billy Hart- man's store, what you think? Billy Hartman was right behind the door. He say to me, ' Good morning. Napoleon.' " He said, " I know damn well when he call me Napoleon he going to skin me." [Laughter.] I knew mighty well when I saw the statement of the majority leaders of how generous and how liberal and fair they were going to be in considering legislation this session they were getting ready to skin me, and they have started by the first bill that has been presented to the House. Now, I have never been opposed to special rules, on certain occasions they are justifiable and I have probably brought more of them into this House than any present Member, but I have always considered there was a responsibility on the Rules Committee to be fairly fair with the House; just fairly fair. [Laughter.] I say without hesitation, and I do not think any man on the majority side will deny the statement, that this is the most vicious, the most far-reaching special rule that has ever been brought on the floor of the American Congress. [Applause]. I admit that is a pretty broad statement. If any man can show me where any majority ever dared bring in a rule to the House that not only hog -tied and prohibited the Members from expressing themselves on the legislation in hand but even extended through the entire session of Congress and all future appropriation bills for the entire Congress, I want him to tell me when It was done. Of course, I know why you are doing it. You think it is easier to hog-tie your own men today than it will be after we have been in session for 5 months. [Applause.] We tripped you up a couple of times the latter end of the last session because your own men were getting ashamed of you. You were ashamed of it yourselves. If you had not been, your leaders would never have given those interviews to the papers. Another thing absolutely sure is that the majority leaders of the House either have no faith in the merits of the legislation presented today or have no confidence in the in- telligence, the integrity, or the ability of their own Mem- bers to pass this legislation on its real merits. [Applause.! Notwithstanding the statement of the Chairman of the Appropriations Committee, this present bill carries more legislation than any average appropriation bill, and it is very vital, important legislation; it is legislation that affects the i ■■pw i: Ir' WM^ m li 486 CONGRESSIONAli RECORD— HOUSE January 11 jurisdiction of a great many of the committees of thij House. If we are going to start this way. what on earthlte the use of forming committees? Why not smiply say. " Th; Appropriations Comirittee and the President are going t) do It aU and we are going to abdicate absolutely aU ovi|- rights a5 representatnes of the people "? Are you real re resentatives of the people or just automatons? One of the items in this bill about which I wish to ta is the authority given to heads of departments to crea deficiencies. Ever since I have been here the policy of this Government has been decidedly and almost unanimously against the granting of any such authority; and I remember ; very well when the present majority leader was Chairmai of the great Appropriations Committee — and he was a good j chairman— he fairly raised the roof of this House talking about deficits on the part of executive departments, saying that never as long as he was in a position of authority i v;ould he agree to any such thing. | Why has he changed his position on the proposition rt the present time? There are two provisions in this bill whereby promotior s are granted to the Army, the Navy, and the Marine Corps perscnnel. but denied to several other branches of tie service. Mr. BUCHANAN. The gentleman is mLstaken about that. We have raised them to an equal basis with the employees of the civil departments of the Government. Mr. SNELL. Why did you not do it with all the rest of the departments? Mr. BUCHANAN. We did. Mr. SNELL. I do not so understand. Mr. BUCHANAN. Read the bill again. Mr. SNELL. It is Impossible to tell what you intend o do because it is all covered up, and you will not tell lis exactly what is intended by any of this language. Mr. BUCHANAN. Doubtless the gentleman has not res.d the report of the committee, for it is very full on this question. Mr. SNELL. It so happens the gentleman has read tl^e report of the committee. Mr. BUCHANAN. Read it again. Mr. SNELL. Another very important matter is the piy of the. civil-service employees. I was one of the Members of this House who last sprmg voted for the present economy measure. I did it with the understanding that it was going to be the policy of this administration to balance the Budget and cut down expenditures so they would somewhere neir equal the income of the Government. Referring to the argimient in favor of the Economy Act at that time, I fiad that the President said in his message, taking partictil^r pains to point it out. that during the previoixs 3 years jof Republican rule there had been a deficit of $4,134,000, He aflrmed that this continued deficit running over a period of 3 years had contributed to the collapse of our bank: sjrstem, accentuated the stagnation of the economic liie, and had added to the ranks of the unemployed. He webt on further to warn Congress that upon the unimpair credit of the United States Government rested the safety Jof bank deposits, the security of insurance policies and tne activity of industrial enterprises, the value of agricultmal products, and the availability of employment. Continuiqg. he said: I give you aasurance that If this Is done, there is reasonatle prospect that within a year the Income of the Government ^111 be sufficient to cover the expenditures. On that basis, on that policy, a great many Memb^s voted for the Economy Act. But within 60 days after t le President received that authority and made that statement, the present administration commenced to spend the mon?y in a more profligate manner than any administration in t le history of this Government. [Applause.! But, in addition to that, the President comes before Congress 10 months after he made his first statement and frankly says that he eit- pects that at the end of the first fiscal year of his adminis- tration there will be a deficit of $7,309,000,000. Now, in the face of this attitude, in the face of the abso- lute recklessness with which we are shoveling money out of the Treasury, what reason is there to further take the $5 or the $10 a month from the cMl-service employees, the old widows, or the service-connected disabihty cases of the World War or Spanish War veterans? [Applause.] I for one am willing to meet each one of these issues on its merits. If you gentlemen are as liberal as you claim to be you wiU give us the opportunity of meeting these issues on their merits, and you will vote down the previous ques- tion on this rule and give this House the right to consider this legislation on its merits and the way it ought to be considered. [Applause.] Mr. BANKHEAD. lAr. Speaker, I yield 10 minutes to the gentleman from Texas [Mr. Buchanan], Chairman of the Committee on Appropriations. Mr. BUCHANAN. Mr. Speaker, I brought all these docu- ments and data here in the expectation there would be 3 hours of debate on this rule. Since there is to be but an hour of debate and my time is confined to 10 minutes, I shall touch some high spots only. First I shall ask the Clerk to read this letter from the President. The Clerk read as follows: The White Hottse, Washington. My DE.VR Mr. Buch-^nan: In my message transmitting to Con- gress the Budget for the fiscal year ending June 30, 1935, recom- mendation was made for the continuance during that fiscal year of certain economy legislative provisions. With regard to the con- tinuance of the provision prohibiting automatic increases in com- pensation, recommendation was made that the Army, Navy, and Marine Corps be excepted from the restrictions thereof, com- mencing with July 1, 1934. Upon further consideration of this matter I feel that if the six services mentioned in the Pay Adjustment Act of 1922 are given privileges of promotion comparable to those conferred upon civil- ian employees it will place the entire Federal service on a more uniform basis. Existing law permits of the advancement of a civilian employee of a lower grade to fill a vacancy in a higher grade, with an Increase of compensation if his rate of pay is less than the minimum provided for the higher grade. If the same principle be applied to the six services mentioned in the Pay AdjvLstment Act of 1922, I believe that such action would place all services on a more comparable basis and remove many of the Inequalities. I hope the Congress will enact the legislative economy provi- sions referred to in my Budget message as changed by the recom- mendation contained in this letter. Sincerely yours. Franklin D. Roosevelt. Hon. James P. Buchanan, Chairman AppropriatioTis Committee, House of Representatives. Mr. BUCHANAN. Mr. Speaker, I ask that the Clerk be allowed to read another letter from the President which I send to the desk. The Clerk read as follows: The WnrrE Hottsb, Washington, January 9, 1934. Mt Dear Mr. Buchanan: I am today signing an Executive order, which, in effect, maintains the 15-percent reduction in the com- {Tensation of officers and employees of the Government until June 30, 1934. I have taken this action only after an exceedingly careful check up by the Department of Labor in relation to the cost of living during the past 6 months. As you know, the act of March 20, 1933. authorizes me to restore a portion of the 15-percent reduction only If the index figiires rise to above 15 percent below the cost of living index for the base period. I have had two careful examinations made. The first of these relates to the general cost of living and shows that it is still 21.1 percent below the index for the base period in the country as a whole. The other set of findings concerns the cost of living of Government employees in the District of Columbia. In this case the cost of living is 14.6 percent below the index for the base period. May I call your attention to the fact that all of these figures are based on data obtained by Government employees themselves, and that every effort has been made to arrive at the truth. I know, also, that you will realize that the overwhelming majority of Fed- eral employees are scattered throughout the United States. In a few cities it is undoubtedly true that the present cost of living is slightly higher than the 15-percent reduction of pay warrants. It is necessary, nevertheless, under the law, to take the average, as there is no provision for picking out special localities for differences In rates. rTkXTnPTTQQinM A T PF.roRn— HOUSE January 11 1934 CONGRESSIONAL RECORD— HOUSE 487 The action taken by me today will, I know, be of interest to yoxu committee in connection with the appropriation bills. I have recommended a flat restoration of 5 percent, or one third of the 15-percent reduction, this restoration to apply to the next fiscal year. I have asked also for authority to restore such portion of the balance of 10 percent as may be warranted by a possible fur- ther increase In the cost of living. I hope that your committee will go along with these suggestions. The problem of returning as quickly as possible to a balanced Budget is involved. To undo the excellent results of the Economy Act of last spring would be unfortunate for the very simple reason that we are very definitely still in an emergency period, in which all of us aie seeking to bring back recovery as quickly as possible. I shall, of course, be glad to talk with you and the members of your committee at any time. Very sincerely yours. Franklin D. Roosevelt. Hon. James P. Buchanan, House of Representatives, Washington, D.C. Mr. BANKHEAD. Will the gentleman sneld a moment for me to submit a request? Mr. BUCHANAN. I yield to the gentleman from Ala- bama. Mr. BANKHEAD. Mr. Speaker, I desire to renew my re- quest in reference to extension of debate on this matter. I do not know that it will do any good. However, I feel sure there are a great many Members here who would Uke to see this matter fully discussed. I therefore renew my request that the time for debate on the rule be extended to 3 hours, one half of the time to be controlled by myself and one half to be controlled by the gentleman from Penn- sylvania [Mr. Ransley]. The SPEAKER. The gentleman from Alabama asks unanimous consent that time for debate on the rule be extended to 3 hours, one half to be controlled by himself and one half by the gentleman from Pennsylvania [Mr. Ransley]. Is there objection? Mr. PARKER. Mr. Speaker, immediately after the House convened today I asked the gentleman from Alabama if he would allot me 3 minutes of the 3 hours' time set apart for a discussion of this special rule in order that I might explain my position with reference to it. I stated at the time that if the Democratic Members of the House had had a caucus and if I had been given the opportunity to recuse myself on accoimt of certain pledges I have made to my constitu- ents. I would not need to explain my vote, but that it was going to be necessary for me to make some kind of an ex- planation as to why I purpose to vote against this rule today. I consider now that I have had the opportunity of explaining my vote, and I certainly do not wish to limit the debate. Mr. RANSLEY. If the gentleman will yield, I shall be glad to give him time. I will yield him 3 minutes. Mr. PARKER. Mr. Speaker, I am not required to go to the other side of the aisle and ask for time. I say now that the reason I am going to vote against this rule is because I have made some definite pledges to my constituents, espe- cially to the American Legion, Spanish-American War vet- erans and their widows, and to certain postal employees. I cannot vote for this rule without indirectly, at least, violat- ing these pledges. For these reasons I objected to the gen- tleman's unanimous-consent request. Since I have been given the privilege of making this statement, I now withdraw my objection. Mr. O^MALLEY. Reserving the right to object, I should like to know from the gentleman in charge of the time if it would be possible to obtain 3 minutes from the Democratic side instead of being forced to go to the Republican side and ask for time to speak against this rule? Mr. BANKHEAD. I am always willing to bargain a Uttle. Mr. O'MALLEY. That is why I am making the request. Mr. BANKHEAD. I will trade with the gentleman. Mr. CONNERY. Reserving the right to object Mr. BANKHEAD. I will state to the gentleman that I make only one trade a day. Mr. CONNERY. I should like to say to the gentleman from Alabama that I am not trjring to make a trade. 1 merely want to say that I have time from the Republican side — and I do not care what side it comes from when it is time to fight for the veterans and Government employees. The SPEAKER. Is there objection to the request of the gentleman from Alab^put? There was no obieetion. Mr. BANKHEAD. I now yield to the gentleman from Texas 30 minutes, or so much thereof as the gentleman desires to use. Mr. RANKIN. Will the gentleman from Texas yield? Mr. BUCHANAN. I yield to the gentleman from Missis- sippi. Mr. RANKIN. There seems to be some misapprehension on my best to put it on there, and I have no apology to mak; to the grntleman from New York [Mr. Skell] or anybody else. [Applause.] Mr. RICH. Will the gentleman yield? Mr. BUCHANAN. Yes. Mr. RICH. If the gentleman Is willing to agree to the thmgs that the President submits, and I have no doubt bi t what those things may be right, why does not the gentlemai want to place some confidence in his own colleagues, and give them an opportunity to use their judgment in matteis of this kind? Mr. BUCHANAN. What confidence we place in our co! - league-s is none of the gentleman's concern. That is oir business; and I may say that we have absolute confidence in our colleagues, and so far as the majority party of th s Hou.se is ccni^emed, the Democrats will take care of then - selves and their own conferences without interference from the Republican side. Mr. RICH. If the gentleman will yield further, I am np backward by Congress in effecting economy and in brlngiikg relief to the country. How do you know what effect It would have if it should go out to the country that Congre» Is not backing up the President and that Congress is n- pudlatlntf the economy program which it adopted at the former session of Congress and was making va^t aiTpropi 1 • January 11 ,0 )f s pi [f ations which the President had not recommended. Why. the psychological effect upon the country of such a course on our part might even interfere with the refinancing pro- gram that the President must accomplish if our country is to recover. The economy legislation contained in this bill is one of the cornerstones and one of the foundations upon which this entire recovery program is based and the President, in substance, so stated to us. Then they talk about defeating it. Now. let us see what this measure does. There are 15 different classifications of savings affected by this economy legislation. First, the general salary reduction of 10 percent, and not 15 percent as we provided this year. This causes an addi- tional appropriation of $63,000,000 which has been added to the Budget to take care of the restorsftion of the 5 percent. That will- save, if the cost of living- does not rise. $128,- 000.000. The next is the prohibition against administrative promo- tions which will save $3,264,000. The prohibition against the filling gf vacancies will save $3,033,000. The reduction in certain rates of postal travel, $1,175,000. Administrative furloughs wiU save $12,000,000 this year and next year only $2,000,000, because the personnel in the ' different departments has been decreased. The following are other savings made during the next fiscal year by this legislation: Reduction in the rural carriers' equipment allowance. $9,660,000. Reductions in jurors' and witnesses' per diems, $868,198. Reduction in permanent appropriations. $2,943,144. Suspension of reenlistment allowances in the Army, Navy. Marine Corps, and Coast Guard. $5,007,725. Prohibition against increases in pay by reallocations of positions under the Classification Act, $111,055. Reduction in benefits payable through the Employees' Compensation Commission, $353,333. Reduction in pensions for wars prior to the Spanish - American War. $7,300,000. Reduction in pensions payable under private acts, $191,- 600. Suspension of automatic promotions, $6,000,000. Mr. SIROVICH. Will the gentleman yield? Mr. BUCHANAN. I yield. Mr. SIROVICH. In 1928 the Republican organization under President Coolidge gave an increase of $18,000,000 to the Federal employees in terms of $60. $120, and $180 increase. Through the Federal Economy Act they have deprived them of $175,000,000. Does the gentleman think that is just? Mr. BUCHANAN. Yes; it is just. Let me tell the gentle- man why I think so. Those employed by the Goverrmient, particularly in these distressing times, are in a very favor- able position compared with the many millions of our citi- zens who are unemployed, partially employed, or otherwise acutely suffering from depression conditions. The Govern- ment compensation, annual leave with pay, sick leave with pay. half-holiday leave with pay, regularity and assurance of pay, retirement benefits, and tenure protection, make public service attractive in normal times and doubly desirable — even with pay reduction — in times of wide-spread unemploy- ment and economic and financial distress. Viewed as a group, our Federal employees are a fortunate part of our citizenship at present. The Government wage is in excess of the wage of all other low-class employees in private industry, even with the 15-percent reduction. Mr. SIROVICH. Does the gentleman realize that over 220.000 Federal employees receive less than a thousand dollars a year? Mr. BUCHANAN. I do not realize that fact. I have a report that I requested from the Labor Department, and that report shows that the employees in private Industry have been reduced 21 to 51 percent more than the Oovem- ment employees. I 490 CONGRESSIONi^L RECORD— HOUSE January 11 1934 CONGRESSIONAL RECORD— HOUSE 489 Mr. SIROVICH. I have a report which shows that in the military and naval forces there are 2,320 receiving less than a thousand dollars a year. Mr. BUCHANAN. I wsis not referring to the enlisted men of the Army or the Navy, who, in addition to their pay the gentleman has referred to, get their subsistence, quarters, clothing, and other perquisites. Mr. MOTT. Will the gentleman yield? Mr. BUCHANAN. I yield. Mr. MOTT. Does the gentleman believe that an em- ployee getting less than a thousand dollars should be cut the same amount as the man receiving high wages? Mr. BUCHANAN. If I had my way, I might exempt from that deduction the low-salaried employees, but every man carmot have his own way in legislation. There must be compromise, and I am not one of those who is so darn stubborn that he believes he is right all the time and that the other fellow is wrong all the time. Mr. GOSS. Will the gentleman yield? Mr. BUCHANAN. Yes. Mr. GOSS. Sixty percent of the employees in the Gov- ernment receive less than $2,000 and 125,000 receive less than $1,000. Mr. BUCHANAN. Yes; and how many millions of citi- zens in the United States do not even receive $50 a month or $600 a year? And the gentleman is also referring in the $1,000 group to a very large number of enlisted men in the Army and Navy, who, I have just said, get subsistence, quarters, clotliing, and so forth, in addition to their cash compensation. Mr. MOTT. May I ask the gentleman another question? The gentleman stated he thought a graduated pay cut would be better, and I agree with him. What would be the objection, to voting down this rule and allowing us to make that provision in this law? Mr. BUCHANAN. Let me tell the gentleman something. I have no tolerance with any man, whether he be on the Democratic or Republican side, who stands up in this Cham- ber and opposes the recovery program of the President of the United States. Mr. MOTT. I do not admit that that is opposing the re- covery program. Mr. BUCHANAN. I say it is. Mr. MOTT. I am stating that it is a better way. and asking the gentleman if he does not agree with that. Mr. BUCHANAN. I have told the gentleman my convic- tions upon that. I shall not yield any more, because there are many things I want to say. Let me tell the gentleman something else. The gentleman may or may not be one of those who did it, but there were 65 Republicans on that side of the House who voted for this identical legislation in the last extra session of Congress. Mr. MOTT. And I venture to say that nine tenths of them are very sorry for it now. Mr. BUCHANAN. They may be sorry now they did it, because this immediately precedes an election year, but when the next election comes on. when our country shall have recovered, they will be very proud of it. Mr. RICH. Is this a political quabble or is it something for the good of this country? Mr. BUCHANAN. Yes; the gentleman's side is making it one. Mr. RICH. We thank the gentleman very much for that information. Mr. BUCHANAN. That Is my judgment. Here Is Mr. BiriLL speaking when this identical legislation was before the House last spring. He said: > Mr. Speaker, what few words I say relative to the legislation before us at this time are not said either as a Republican or as a Democrat. They are said as a loyal American citizen, who desires to meet the duties that come to him as a RepresenUtlve In this House. As a loyal American citizen — not as a Republican, not as a Democrat! Your distinguished Republican leader says he makes them as a loyal American citizen. He supported and voted for this legislation at that time. Mr. TABER. Mr. Speaker, will the gentleman yield? Mr. BUCHANAN. Wait a minute. An election is coming on, and it has been one of the weaknesses or the strength of the Republican Party to appeal to organized minorities in the coimtry. Mr. TABER. But that bill did not cOny a repeal of the antideficiency laws of this country. Mr. BUCHANAN. It carried the same provisions that are embraced within this rule in title II of this bill. Mr. TABER. . But that provision was not in it. Mr. BUCHANAN. Oh. the gentleman says it did not carry the little routine administrative provisions that au- thorize a department to incur a deficiency. They did not tell you how that was. They can incur a deficiency only if the cost of living goes up and a part of that 10-percent re- duction is restored. They can incur that deficiency only on a specific order from the President specifying the amount, and it shall not be any greater than the exact sum necessary to pay the raise in the salary that he gives them. This opposition to that provision is all just a subterfuge, Just an excuse these gentlemen are hunting up to attack this bilL Mr, OLIVER of Alabama. Mr. Speaker, will the gentleman yield? Mr. BUCHANAN. Yes. Mr. OLIVER of Alabama. No one will undertake to base his objection to this particular provision that is now being discussed upon the ground stated by the gentleman from New York [Mr. TaberI. Mr. BUCHANAN. Of course not. I want to read a Uttle more from the gentleman from New York [Mr. SnellL Mr. WIGGLESWORTH. Mr. Speaker, will the gentleman yield? Mr. BUCHANAN. Let me finish with Mr. Snell. You have in this bill a salary reduction of 10 percent. He was supporting a salary reduction of 15 percent in March last. Let us see what he said then: Several months ago I took the floor and asked that responsi- bility for this kind of work be given to the then President of the United States. The Democratic majority did not aU agree with me then; why, I do not know; but I have not changed my posi- tion one lota. I stand now as I stood then. If you are going to accomplish this purpose, you must put It up to the President of the United States and hold him responsible. This Is not a time or place to review or discuss bygones. • • • Every part of this country Is In a terrible situation and waiting for affirmative action by Ctongress. Every municipality, town, county, and State is cutting down Its appropriations and cutting down salaries of Its officials, and I tell you. Mr. Speaker, we must set the example here. We mtist put the Federal house In order first. That Is the crux of the whole situation. It Is up to you men to do your duty here today and give the President an oppor- tunity to do the things that he says are absolutely necessary. Mr. Speaker, I repeat the speech of the majority leader. Mr. Snell, to the Democratic membership of this House. It is up to you to give the President that legislation which constitutes an integral part of his recovery program, that he might proceed to accomplish the purposes he started out to accomplish. I could quote practically the same thing from toy friend, the ranking minority member of the Com- mittee on Appropriations, the gentleman from New York [Mr. Tabbr]. He emphasized the fact that salaries ought to be cut by the Federal Government. Why then have they changed front in 9 months? In favor of the cut last March or AiH-il, against the cut now. Mr. TABER. Has the gentleman been speaking about me? I have not changed my position on the right to cut, but I do not believe in a rule which permits the antidefi- ciency laws to be repealed without a fair vote. I believe in going down the line just as I went before, notwithstanding the President has run out on us with this extravagance pro- gram that he has put across. Mr. BUCHANAN. Now. one other thing. I know, as Chairman of the Appropriations Committee, that salaries In the regular Oovernment departmenU and Independent establishments are based on the schedules in the Classifica- tion Act. It came to my attention that in the emergency agencies, they were not based on that act. but they were paying higher salaries in some of those organizations. I im- M 1934 CONGRESSIONAL RECORD— HOUSE 491 former session of Congress and was making va^t appropi 1 • I ment employee*. CONGRESSIONAL RECORD— HOUSE 490 mediately wrote every one of those emergency organtzatloi is. and I immediately got In contact and conference with tie Prenldent on that subject I am Rlad to say that on Novem- ber 18 thr President tssued an Executive order directing that tlic 8alar.es be placed on pay cchedules approximating thn- tinue the wage-cutting program into 1935, and reduce the purchasing power of faithful employees. Is so Inconsistent that It cannot be explained away. Little wonder that the supporters of this rule and the provisions It makes in older do not even make the attempt. Mr. Speaker, if the recovery procram to revive Amerl:an ba«incss thr ouch Incrraacd was*rs and purchasing powe* Is right. thU wagr*cuttlng program i» wrong. Both cannol be right. I am convinced that the National Industrial Recov- ery Act \B fundamentally sound and right. llKire has not been, and there Is not now, any other way to emerge f i om the Hwamp of deptemtion Mve through n reHtoration of buy- ing power in the handN of Amerlrann. Tlien, why do we not have faith enough and courage enough to follow the riLht courar as to thoae workerit for whoso wage standards Cpn- greM u aloms rt-sponNible? I um frank to say that the N.n.A. has not proved Its efiec tlverieas as yet. The one weak point, which may prove fijtal, is wage pay rolU aa compared to price and production Sometime ago I asked the Research Division of the I^d eral Reaerve Board to prepare a table for me showing the relation of price, production, and pay rolls In November 1933 January 11 as compared to the average for the year 1926. which by common agreement is the best year to serve as a standard for our recovery clTorta. The figures furnished were illuminating. Wholesale prices and industrial production were exactly balanced in Novem- ber 1933. Employment, including all part-time employment, was a little more favorable than either prices or production. But pay rolls, the very key to success, because they embody the purchasing power which alone can sustain prices and production, were 16 points behind prices and production. That gulf must be bridged or prices and production will collapse. The figures show that the N.R.A. has not sinned in the direction of too high Vsages but rather in the direc- tion of too low wages. The codes must be revised upward as to wages and downward as to hours of labor. What position is the Government in to take that necessary step while it cuts the wages of its own workers? Private employers know the present inconsistency. One of them from my own district said to me the other day, " The Gov- ernment had better stop cutting wages itself before it asks us to increase wages." The best thing we can do here and now is to put the blue eagle over the post oflBces and every other place where employees labor for Uncle Sam. [Applause.] Mr. Speaker, I am not going to waste my time by de- nouncing this ruthless, utterly unjustifiable gag rule. It offends against the principles of representative government. Every Member who votes for it deliberately chooses to rob himself of rights which belong to his office and to prevent this House from acting as a deliberative, legislative body. I want to address myself during this 'iniited time to the provisions of law which this rule makes in order, and in effect enacts into law without real discussion or possibility of amendment. First, it means a wage cut of 10 percent for every worker in the Government service, no matter how small may be his pay. I have on my desk a letter from an old and worthy constituent, who for 28 years has been a light attendant under the Bureau of Lighthouses. He looks after lights on the Monongahela River, and every evening and every morn- ing, in winter and in summer, he crosses the river to look after his lights. His regular pay is $12 a month — a month, not a week. He writes me that under the Economy Act now in force he loses $1.80 every month out of that pittance. He states that this cut is cruel, in view of the fact that he has no other income and is compelled to buy a boat every 3 years in order to perform his duties. In the Postal Service, with which I am most familiar, there are about 30.000 apprentices, known as postal sub- stitutes. They are essential to the conduct of the great Post Office Service. They are paid by the hour for the hours they work. They report at their various post offlces every day for duty. For the last 2 years they have been able to secure only trifling employment, due to the fact that there are " floating " regulars who are used for the work which formerly went to the sub.stltutes. Vacancies through death and retirement are not filled, thus shuttln? off the chance for appointment for the sub.it Itutcs. These are not boy.i but men \\ho have .served years In the hope that some day they might Micure a place In the regular service. Many of them are married, ntrtiKgling to Htipport their famllleN on four or nvo dollars a week. Ten percent of their mlHcrablo poy will be deducted under thin program for 1938, We have made n worthy attempt to end 'twrutnhop wages In private industry, It inluht be wrll to end «we«t«hop wagcn under the flag of thf United Htutes. whrre Congrc»« has the solo power and r»"»ponMibillly, I Applause, 1 L^l jne quote the word* of one of these substitutes In the Postal Oervlce who U now faring the actual conditions which apply m many thou.Minds of iiwtances, He writes; Wi» have in thU ornce at the present time 4fl fcUbhiltutM. Of lUU number ^J^ are murrled und Ifl have children. Only tlireo of UK have no one dependent upun uurtelvc* for bupport. The spnlor substitute has 7 years and 2 montlw' service and the Junior Bubstltuce hus 4 years' service. Wc have never been furlouj^hed cotnpulsorily. not because of coaslderatlon tor ub but simply to have us available in case of ^^ ..-» -k T y-» i-» i-»r~inT/^XT A T T»T7n unTTCT? Tamitarv 11 Twwu Avt bkU0 m^tmtan)tv»t tv V**«VV V* 1934 CONGRESSIONAL RECORD— HOUSE 491 emergency, th«r« hairing been periods of a and • weeks when none of us have been employed • single twur. We have received a total of 1176 In contributions, the proceeds of ft fund collected by the regular employem, to provide relief for our destitute members. The reKulars also absented themselves during March 1933 for 1 day without pay by 'permission of the local authorities, It being agreed that substitutes would be em- ployed to replace them an equivalent number of hours. Until several months ago we found It impossible to obtain relief from the charitable agencies due to our being regarded by them aa having Jobs. Despite the fact that we were to aU practical pur- poses unemployed, however, after prolonged agitation, tlie Federal Relief Administrator Interceded In our behalf and directed the local relief agencies to Khow no discrimination against us. As a result several men are now receiving aid. The average substitute's age is 28 years. We all have borrowed to the limit. Should we receive regiUar appointments immediately it would take the majority of us several years to emerge from debt. Some of the men have lost their homes, and other have been dependent entirely on the charity of friends and relatives. I know the argument is made that the lowered cost of living applies to these substitutes and other small-pay em- ployees. Therefore, they should stand the pay reduction in the same percentage as the others. It is not an argu- ment; it is sheer cruelty. When full pay even under the best of conditions means hardship and want, the reduction of a few dollars is an inhuman practice. I am opposed to basing wages on solely a cost-of-living basis. That is the theory underlying these wage provi- sions. The President w&s given power to determine the cost of living during the first 6 months of 1928 and use that as a base period. Then he is to determine the difference in cost of living during each 6 months' period and compare it with the base period. Already we have had three such determinations and each time the armouncement has come that the cost of living has not yet reached a point which would permit an advance in pay. The last announcement was based on statistics which no Member of this House understands. The Bureau of Labor Statistics, in promulgating the findings on which the President acted, made the following statement: As a basis for this determination Information was obtained on the expenditures of different t3rpes of Federal employees at both dates, through detailed schedules filled out in personal Interview with employees whose names were choeen by lot, and through 2 questionnaires, 1 sent to all employees and 1 to a large sample of employees whose names likewise were chosen by lot. Prom these data the quantity and the cost of different goods and services purchased by Federal employees in the first 6 months of 1928 have been ascertained. The cost of the same bill of goods and services in December 1933 has been computed, and Index nimibers have been calculated showing relative costs of the two periods. Prices have been collected which make it pos- sible to calculate living costs in March 1933, but they have not yet been summarized. Taking costs In the first 6 months of 1928 as 100. the index of the average cost of living for all Federal employees In the District for December 1933, was 85.4, showing a decline of 14.6 percent. BXPABATC INDICES MADS In addition to the index for all employees, separate Indices have been computed for the families of 3 categories of employees — custodial, with salaries less than $2,500: others with salaries below •2.600, and those with salftrles of »2,B00 or more. An index was also computed for single individuals living in rented rooms, of whom there arc about 10.000. The Indices for these groups are as follows; Custodial, with salaries les* than $7,600. 83,4 percent. Other employees with salaries less than Sa.MK), 86.1 percent. Employees with salaries over »2,ftOO, 86 percent. Blnglt individuals living in rented rooms, 88 percent. Mr. Speaker, the practice of " caatlng loU " comes down from ancient tlmea. but it ought to be possible to devise a better plan In 1034 for dealing with human problems which mean happiness or misery for American!. This whole coit-of-llving theory Is old and decrepit and ahould be laid beneath the sod. It is based on the belief that wages Is that pay which will keep a worker alive and enable him to produce another worker to take hU place, That theory would destroy all advancement and paralysee all progress. To say that a certain period in 1028 shall be the very maximum of achievement is unworthy from every •tandpolnt. Were the wages in that sacred period adequate to a decent American standard of IMrlng? They were not. At that time 124,000 Government employees out of a total of 700,000 received leee than $14)00 % fMX Mid 417,000 received leet than $2,000 a year. Wages must not be fixed beyond chance of advancement. They must depend upon productivity and service. Tbert must be an ever-increasing standard of living through In- creased Income If this mass-production system la not to burj us all under the debris of an Industrial order out of all con- trol. The very heart and goal of the new deal must be the true deal of human advancement and growth. There is another provision in these measures which it is sought here to reenact for 1935. That is the ban against promotions within the service. It means great additions to the pay cut for a great host of workers. The President, in his Budget message, recognizes this in- justice as far as it appbes to the military services. He said: Among the legislative provisions appended hereto la one pro- hibiting automatic increases in compensation except in the Army. Navy, and Marine Ctorps. The personnel of these three services are engaged in a life service to their country. Some, by reason of the pay freezes, have sustained redUfetion in compensation of more than 25 percent. They are. therefore, in a different category from those in other governmental agencies. They should, in 1935. be released from the restrictions on automatic increases in com- pensation. He is right that the ban should be lifted on promotions in the Army, Navy, and Marine Corps. These promotions are part of the agreement when men enter these services, and they should be faithfully maintained. But exactly the same arguments, and with even greater force, apply to the civil- service employees. They, too, enter upon a life service. They, too, in many instances have suffered a loss of more than 25 percent of what they should receive. Take the Railway Postal Service, an indispensable part of the job of getting mail from the sender to the addressee. The situation faced by a grade 2 terminal clerk is as follows: Loss on promotion, fiscal year 1934 $150.00 Loss on salary (15 percent) 300.00 Loss on night differential ( 15 percent) 30. 00 Loss on payless furlough (first quarter) 51.25 531.25 Salary. $2,000. Percentage of loss, 26.56. Grade 2 clerk assigned to road duty on June 30. 1933. dtie to be promoted to grade 3 July 1, 1933. Promotion lost under provi- sions of present Economy Act. Loss on promcJtlon, fiscal year 1934 $150. 00 Loss on salary (15 percent) 300.00 Loss on night differential (15 percent). 1984 80.00 Loss on travel alloMrance (SSVs percent), 1934 87.00 Loss on payless furlough (first quarter 1934) 61. 25 618. 35 Salary, $2,000. Percentage of loss. 80.01. Post-ofBce clerks and letter carriers in the lower grades meet the same additional wage cuts, reductag their incomes by 25 percent and more in some cases. The Appropriations Committee has modified the Presi- dent's request so that the advances will apply between grades and not elTect the longevity Increases. At present vacancies In the captain rank can be fMled by a lieutenant only through Executive order, The modified provision will permit this promotion In regular course and without Executive order. Exactly the same condition Is found in the Postal Service. At present a post-olBce clerk cannot be given the pay of an assistant superlntendMit of malls without an Executive order. He may do the work, and In many cases he does, but ht cannot be paid the salary which goes with the position, Is there any reason why this clvll-servlce trnployte should not be placed on the same basis as the military -service employee? Yet the provisions which this rule will snact contain that unjustified discrimination. Mr. Speaker, there are other features of this program which I have not time to describe. There are furloughs to hang over the head of every employee and to deseetul with deadly force upon many. There are reductions In travel allowances, even though the emjrtoyee must pay thU addi- tional sum from bis pay In the performance of his required duties. 1934 CONGRESSIONAL RECORD— HOUSE 493 relation oT pnce, production, and jjay rolla in November 11933 I Wi- have never been furlouj^hed cotnpulsorlly, not because of I cooBlderaUon for us but simply to have ub available In case of 124,000 Government employees out of a total of 700,000 ' duties. 492 CONGRESSIONAL The whole program Is unsound and inhuman. It is not recovery medicine but depression poi-son. It was said at nrst that these drastic meai.ures entailed hardships, but they must be endured for the sake of a balanced Budget and to maintain the credit of the United States. We heard that thundered forth last March, but it is expressed in a still small voice today. Then we saw a picture of a balanced Budget for next July 1. Now we are told that, although the wajfe cuts were made, the Budget will be out of balance by $7,000,000,000! We saved about $135,000,000 by the 15-percent wage cut. and we spent $341,000,000 for the civilian conservation camps. With that $135,000,000 spent by Government work- ers, turning over and over in the charmels of business, a large part of those in the conservation camps could have been occupied in normal employment. Mr. Speaker, the National Budget will not be balanced until Americans get an opportunity to balance their own budgets on decent income levels. Purchasing power will create orders for idle factories and idle workers and nothing else will. As to the credit of the Goveniment, it should not be en- tirely forgotten that that word " credit " is used in connec- tion with those who pay their just obligations. A miser may hdve great hoards of money, but if he will not pay his obligations he is not entitled to credit in business. The Government has an obhgation to maintain the wage standards fixed by laws enacted in regular procedure. They were part of the agreements made with workers when they entered the various departments and services. They were low in the best of times, but American citizens accepted them and the fact that they could never expect to win any high rewards in return for security of position and income. This understanding was not a legal contract and it cannot be enforced in a court of law. I maintain that it is a moral contract, and that the credit of the Goverrunent would be strengthened by keeping it. The fact that private employers were forced to lower wages below any cut suffered by Government employees does not give warrant to governmental wage cuts. It simply proves that private business, <'ependent upon profits for existence, must take desperate measures even though they destroy general purchasing power and injure the community. The individual may be forced to do what should not be done in view of the public interest. The Government is under no such compulsion, for it can do those things 'vhich are for the common good and use its efforts to help bring those condi- tions where private business may do the same. Mr. Speaker, we talk about figures and percentages but beyond them are lives and homes. Cutting a few dollars from small incomes means lack of shoes and clothing for school children, lost educational opportunities for young men and women. It means lapsed insurance policies, loss of homes because mortgage payments cannot be iriet. It means that the help given unemployed relatives is made impossible with consequent added burdens to relief and welfare agencies. It means privation and suffering in many forms. Let us end such a policy and adopt the true recovery principle that increased wages and purchasing power alone can end this monstrous situation where all of us suffer be- cause too much is produced. Let us end this wage reduction which takes income, not only from faithful and e£Bcient Gov- ernment workers but from American industry and trade and agriculture. Vote this rule down. Restore these wage levels to the very moderate standards set by Congress in orderly procedure. That is marching forward, not backward. It will bring encouragement to every worker in the land. It is a stride on the road to recovery. [Applause.l Mr. BANKHEAD. Mr. Speaker, in accordance with my agreement, I yield 3 minutes to the gentleman from Wis- consin lUdr. CMali^yJ. Mr. CMALLEY. Mr. Speaker, I shall not consimie all of the 3 minutes. I merely want to call to the attention of the Members upon the Democratic side that in this rule we are asked to vote not only upon the proposition of giving help RECORD— HOUSE January 11 1934 CONGRESSIONAL RECORD— HOUSE 493 to those who have been unjustly harmed by the Economy Act passed last spring but if the rule is voted it will prevent us during the rest of this session of the Seventy-third Con- gress from offering any amendments to any other appropria- tion bills that may come in here, even though we desire to right any wrongs caused by the Economy Act. Personally, I do not want to vote to bind the Members of my party against doing anything they may want to do in the rest of this session to correct injustices that may have occurred in previous appropriation bills and injustices grow- ing out of the Economy Act itself that was passed in the special session. I shall vote against this rule because I do not want to force upon my colleagues a restriction upon their action in the future and because I do not want to force them into a position where they cannot do anything about any appro- priation bills yet to come before us. [Applause.] Mr. RANSLEY. Mr. Speaker, I yield 7 minutes to the gentleman from Massachusetts [Mr. Connery]. Mr. BANKHEAD. Mr. Speaker, will the gentleman yield for a unanimous-consent request? Mr. CONNERY. I yield. Mr. BANKHEAD. Mr. Speaker, to save time, I ask unani- mous consent that all gentlemen who speak on the rule may have permission to revise and extend their remarks. The SPEAKER pro tempore. Is there objection to the request of the gentleman from Alabama? There was no objection. Mr. CONNERY. Mr. Speaker, in Massachusetts recently I attended a reception given by postal workers. Three or four postmasters were there. I overheard two of them sit- ting next to me having a discussion as to whether they had remembered to put the blue eagle in the windows of their respective post offices or whether they had forgotten it. I was introduced to speak after I had heard this discussion, and I turned to these postmasters and said: "You gentle- men are all wrong on this proposition. The blue eagle is for concerns which have raised wages and shortened hours. The United States Government has cut wages and length- ened hours of its employees, so what you ought to have in your post offices, as well as in all other Government depart- ments, is a black hawk. [Applause.] Let us hope you may soon be entitled to display the blue eagle, because the blue eagle represents higher wages and shorter hours, and let us hope that the Government will soon do away with the black eagle of long hours and cut wages. The United States Government Should be consistent and place its own em- ployees under the N.I.R.A." If you Members of the House here today want to help labor, if you want to help the underpaid Government em- ployee, if you want to help the World War veteran, the Spanish War veteran— 37 suicides of Spanish War veterans took place in the State of Massachusetts alone within 3 months after the passage of the economy bill — if you want to help those veterans, the Civil War veterans, and all the underpaid people in the Government service, you will vote down this rule, because this is the first strategic move in the battle for the veterans and labor, and the first fight comes on this rule. We have heard a lot about the cost of living not having gone up sufficiently to warrant the removal of the 15 per- cent cut on Government employees. I think such an argu- ment is answered pretty fully in this speech delivered by Harry King, a department store owner and former head of the Washington Chamber of Commerce. These figures are now the confirmed and official figures of the Department of Labor. I shall read his statement from the Washington News: Living Costs Are Outdated as Wholesale Prices Rise — Presi- DKNTS DETEaHINATION WaS BaSED ON RETAIL FIGURES. NoT YET AfFBCTED BT NJl_A. BOOSTS IN MANUFACTURING EXPEN&ES By C. A. F. If there is any cheer to be drawn from the President's order for continuation of the full 15 percent Government cut until July 1. here it Is: The cost-of-living basis for determining Gov- ernment salaries is likely to be so thoroughly discredited before July 1 that the President and Congress wUl be convinced of Uie need for Junking It. The reasons for that statement were given In a public address not long ago by Harry King, department store owner and former '''i head of the Washington Chamber of Commerce, and they are now confirmed by official figures of the LAbor Department. King said that when N Jt.A. was being organized " every mer- chant knew that with increased coste for labor in manufacturing industries prices would rise. Every merchant went into the mar- ket and bought, at low prices, quantities of goods that would stock him for many months. BSTAILESS MUST FOLLOW "The merchants". King continued, "sold this merchandise on the basis of what it cost them. But now most of it Is sold. Hardly an item can be replaced by the merchant without paying 15 to 40 percent more and, in some ca.ses, 100 percent more, to the manufacturer or Jobber. Spring merchandise will be much higher to the consumer as well as to the retailer." The Labor Department's confirmation is in its report of whole- sale prices for the week ended December 30. It showed that ^ since March 4 prices of all commodities have increased 19 percent, j Farm products have gone up 40 percent; textile products, 50 per- cent; house furnishing goods. 11 percent. WORKING OF N.R.A. The 19-percer.t Jump for all commodities is traceable to opera- tion of the N.R.A. codes, which set minimum wages and also prohibit selling under cost. Labor Department officials agree these higher costs in manufacturing have not yet been reflected in prices to the consumer, but that they must show their effect when the retailers begin to sell their spring merchandise. LAW SETS FIXED PATTERN The Labor Department survey on which the President's con- tinuation of the full 15 percent cut is based could not, under the law, take into account this changing factor. Nor could the Presi- dent depart from the letter of the statute, which prescribes that average living costs for the 6 months Just ended must be compared with the first 6 months of 1928. Even the special survey conducted In Washington cotild not depart from the legal pattern. It could not consider the " human Bide •', nor could it estimate the probabilities of the next few months. It had to be a statutlcal statement of what it cost to live (based on retail prices) In the last 6 months of 1933 as compared with exactly the same manner of living in the first 6 months of 1928. NO CREDIT FOB DEFENDANTS The law assumed that all persons lived exactly the same in 1933 as in 1928. The Labor Department survey has shown that Is far from the truth. In particular. Government employees have many dependents they did not have In 1928. Most of them are unem- ployed relatives being supported wholly or largely by the people with steady Jobs. The law takes no account of them. NEW LAW ONLY REMEDY The only hope of a remedy lies In a revised law, for which many officials devoutly hope. The only way of getting a revised law is for Congress to enact It. Congress probably will not act unless the President recommends It. Congress cannot act at aU after its adjournment, which most forecasters say will be well before July 1. It comes down to this. It is all right to refer to statistics compiled by the Department of Labor, to show that the cost of living has not gone up. But 1928 and 1933 are very far apart as to living conditions. The Post Office employee and all of the Government workers, when they go into the grocery stores and into various retail establishments to buy mer- chandise, are not following the Department of Labor sta- tistics. They are following the prices that they actually must pay that retail store. The cost of Uving has gone up, and it is going up higher within the next few months. It seems to me totally incon- sistent for the United States Government to take the stand it has in this matter. You will remember the principles we fought for in the Black-Connery 30 -hour week bill, which eventuated into the N.I.R.A. during the last session. I am 100 percent for the principle of the N.I.R.A., but I believe that In justice to all industry in the United States and in justice to labor you will have to come to a 30-hour week, not to a 40-hour week, not a 35-hour week, not a 32-hour week. You will have to come to a 30-hour, 5-day week, 6-hour day if you want to put the people of the United States to work and really relieve the unemployment situation in industry. In the 30-hour week bill we sought the right of collec- tive bM^aining, the abolition of child labor, the aboUtion of the " yellow dog " contract, and the right of labor to organ- ize. We talk about minimimi wages and shortening the hours of labor. The letter carrier who walks the street in front of your house sees men in the woolen mills, or fac- tories, or whatever industry you may have in your district. He sees his own wages cut down to the bone. He sees the President of the United States and the Congress of the United States saying to the manufacturer: "Bring up your wages. Shorten your hours." Then to his amazement he is told by the United States Government (although he. as a Government employee, should be used as an example by the Government to lead the way to Industry in wages and hours under the banner of the NJIA.) : " We have cut your pay and we are going to keep down your wages instead of giving you the decent living wage which we insist your neighbors shall have." And remember, these Government employes did not get a decent living wage when times were good. They did not get a really decent living wage at any time. Remember, I am referring to all Government employees. I merely take the Postal Service as an example, because they are the ones with whom you most often come in per- sonal contact. Many of them could have gone out into pri- vate industry and could have received five times the amount being paid them by the Government, on account of their brains and ability. But, due to loyalty to the United States Government over a long period of years when times were good they did not go to private industry and get the money to which they would be entitled. They stayed with the Government and were loyal to the United States, and for doing that we penalize them at this time by cutting their pay. I think it is all wrong. Mr. SIROVICH. Does the gentleman realize that in our country we have starvation wages, living wages, and saving wages; starvation wages that starve the body and mind, liv- ing wages that keep body and soul barely together, and the time has come when the people have to save in times of affluence in order to take care of themselves in times of adversity. Mr. CONNERY. The gentleman from New York, my friend the distinguished doctor, is absolutely correct in his state- ment. We have passed the days when the country wUl stand for either starvation wages or mere living wages. The work- ing people demand their place in the sun and will have it. The day of the saving wage is here, thanks to the courage, humanity, and statesmanship of President Rooeevelt, who has given new hope to the exploited workers of industry in the country by his program for high wages, saving of homes and farms, and the N.I.R-A. But let us be consistent. Let us put the Government workers under the NJIA. and make them proud to work for an Uncle Sam who brings them into the family fold of all self-respecting workers of the country and does not treat them like stepchildren to be driven out into the forests of despair to be devoured by the wolves of long hours and low wages. The SPEAKER. The time of the gentleman has expired. Mr. CONNERY. In conclusion may I say: If you are for the worker and the veteran, vote down this rule. [Applause.] Mr. BANKHEAD. I yield 7 minutes to the gentleman from Texas [Mr. Patman]. GAG SULB Mr. PATMAN. Mr. Speaker. I am in favor of high wages. I have always voted for high wages. Wage earners must receive good wages in order to be good buyers. I have always voted against what is known as the " gag rule." HOW VXTSRANS AVTBCRD We have before us today a situation that we must soon face. We will have to cast our votes on a rule that is known as a " gag rule." It is really not entitled to that name, but if our opponents get any consolation out of it, we will admit it. The distinguished gentleman who preceded me said: If you are In favor of the veterans, vote against this rule. I want to make the statement that there is nothing in this rule that will make out of order any amendment on veterans' legislation that would be in order if we did not pass the rule. Mr. OTkiALLEY. Will the gentleman yield? Mr. PATMAN. I will ask the distinguished gentleman from Alabama, a ranking member of the Rules Committee, if that is correct? Mr. BANKHEAD. That is absolutely correct. There is no question about that. All* PntJnTJFSSTONAT. RFrORD— HOUSE January 11 1934 CONGRESSIONAL RECORD— HOUSE 495 Members upon the Democratic side that in tms rule we are asked to vote not only upon the proposition of giving help July 1 that the President and Congress need for junking It. will be convinced of the 494 CONGRESSIONAL Mr. PATMAN. So we can dismiss veterans' legislation from consideration when we vote on the rule. Mr. LUNDEEN. But it does apply to the widows of Civil War veterans, does it not? Mr. PATMAN. Only 10 percent off the Civil War vet- erans' widows, and if the World War widows can take a 100 percent reduction and the Spanish-American War widows can take a 50-percent reduction on non-servic«-connected cases, certainly the Civil War widows can take a 10-percent reduction on non-service-connected cases. ^r. LUNDEEN. They cannot take it without starving to death. rCDKBAL EMPLOTEIS. MAT GET ALL RISTOREO Mr. PATMAN. The civil-service employees will have re- stored in this bill an appropriation from July 1 of this year — 1934 — until June 30 next year— 1935 — covering 33^3 percent of what they have lost. The bill also provides that the Presi- dent may restore the other 66-3 of the reduction when the cost of living increases. I sho^old like to see them get it all back, but remember this, gen.lemen. that we have a very definite program for recovery that we are trying to follow. We do not want to disrupt that program. I do not believe the Federal employees desire to run the risk of injuring eco- nomic recovery by insisting upon whole restoration of sala- ries at this time when they may get total restoration any- way. HOMES SAVED When the present leader in the White Hou.se came into power there were millions of ijeople all over this Nation on bended knees praying that some way would be devised that would permit them to save their homes. I saw old men and old women break down and cry like little children because they were losing their homes. This condition existed all over this country. This program for national recovery spon- sored by President Roosevelt is saving the homes of millions of people. The program calls for the use of the Govern- ment credit of this Nation for the purpose of saving people's homes and reducing the high Interest burden which those people have been forced to bear. This is not only saving the homes of people in cities but saving the homes of people on the farms. They are not only given a longer time to pay their mortgage debts but in many cases they are scaled down, and in all cases the interest rate is considerably re- duced. The leader in the White House is responsible for it. He is the man that we are following today. DESTTTUTION KELKVED When this depression started the statement was made: " Why can you not use Federal fimds to relieve destitution?" " No ", it was said. " it is unconstitutional to do that. We cannot do It." But our pres«?nt leader said, " We have to do it, it must be done ", and he has relieved people all over V this Nation and gave them food, clothing, and necessities from Federal funds. President Hoover told the destitute to go to the Red Cross. T7NEMPLOTEO HELT When this depressim started it was said, " Why can there not be some way devised that will permit people who are unemployed and who are able and willing and anxious to work to find some kind of Job that will enable them to , provide a living for themselves and their families?" and this great leader has provided a way for millions and miUions of these people to work and to provide a livelihood for them- selves and their families. Mr. Hoover told this large group to go to the Red Cross. Mr. GLOVER. Will the gentleman yield? Mr. PATMAN. I shall be pleased to yield to the gentle man. Mr. GLOVER. I regard the gentleman as being our best authority on veterans' legislation. Many of us hope to see legislation passed at this Congress for the relief of Spanish- American War veterans and other veterans whom we think ought to have relief. Do I understand the gentleman to say, based on his knowledge of veterans* affairs, that nothing in this rule would prevent us from considering legislation that Is now pending affecting that very question? RECORD— HOUSE January 11 Mr. PATMAN. I thank the gentleman for the compli- ment, but I am not entitled to be called an authority on veterans' legislation; however, that is my understanding in regard to veterans' affairs inquired about; and, furthermore, the Chairman of the World War Veterans' Committee, the Honorable John E. Rankin, has already announced that there will be hearings on veterans' legislation, and there is nothing in this rule that you vote for that will prevent such legislation from passing this House or in any way inter- fering with it. It is ridiculous and absurd for one to vote against this rule on the theory that it will be detrimental to vptprsTiS Mr. ZIONCHECK, Mr. O'MALLEY. and Mr. BRITTEN rose. Mr. PATMAN. Obviously, gentlemen, I cannot yield to all of you. I have only 2 or 3 minutes remaining. Mr. ZIONCHECK. Will the gentleman yield for one question? The SPEAKER pro tempore (Mr. Thomason). The gen- tleman from Texas has declined to yield. FARMERS HELPED Mr. PATMAN. Not only has this program been adopted for the purpose of relieving destitution and giving people jobs but also to restore the purchasing power of the farmers of this coimtry, and may I invite the attention of my friend from Massachusetts, Mr. Monnery, to the fact that I was in Lynn, Mass., a couple of years ago and shoe workers there were walking the streets? They were unemployed. Why? Because there was no market for shoes; and I am very pleased to tell the gentleman that the people in the South and the West and in the agricultural sections of the country are buying more shoes today than they ever bought before because the purchasing power is being restored to people who need shoes, and I hope the time will soon come when his section will be able to put all the shoe workers to work, but certainly this will not be done until purchasing power is restored. The President is determined to restore farm prices. PRESIDENT AGAINST IT I should like to see the Federal employees get all their pay back, especially the ones receiving salaries less than $3,000 annually, but this great leader of ours, who says he is going to relieve destitution, give unemployed people jobs, save people's homes in the cities and on the farms, and restore the buying power of the people, does not want this pay restored now and I am not going to do anything that would have a tendency to disrupt his program, because it is a great program. It is relieving distress and misery and bringing happiness and prosperity to many of our people. We want it to go onward and forward. All of us cannot be leaders. We must follow someone in a time like this who has a constructive program. We cannot expect a program to be presented that we will agree with in its entirety. Mr. CONNERY and Mr. SIROVICH rose. Mr. PATMAN. I will yield to the gentleman from Massa- chusetts, because I mentioned the gentleman's name. Sorry r do not have the time to yield to the gentleman from New York. Mr. CONNERY. The gentleman mentioned my name and I understood the gentleman to say that the people were all employed in Lynn. Mass. There are a number of shoe workers not employed and they will not be employed until we go to the 30-hour week. The gentleman also states that this rule does not affect the veterans. Such a legislative provision on an appropriation bill is the way we took the money away from the veterans the last time, and by defeat- ing this rule we can give the money back to the veterans in the same way, but if we adopt the rule we cannot do it under this bill. [Applause.] [Here the gavel fell.] Mr. BANKHEAD. Mr. Speaker, I yield the gentleman 2 additional minutes. Mr. PATMAN. Any amendment that would be in order without this rule will still be in order with it, I will say to the gentleman from Massachusetts, and the members of the ujries, or wu*n^ uu>«. 1934 CONGRESSIONAL RECORD— HOUSE 495 Rules Committee will bear me out in this statement. The gentleman can offer an amendment to increase the amount proposed to be appropriated for any class of veterans after this rule is adopted. It will not in any v.ay affect such an amendment. WILL WE JOIN THE PRESIDENT'S ENEMIES? Now, suppose it does affect the veterans. What are you goii^ to do? Are you going to disrupt this great program I have been telling you about that involves not only 2 or 3 or 4 miUion people but involves 50 or 60 or 100 million people? Probably the President is wrong in his views, but he is our President; he is our leader. Are you going to throw any kind of monkey wrench into the program, and will you line up with the President's enemies? Who are they? Well, the Power Trust. They do not like the President because he has not been doing what they wanted done. The speculators do not like him; Wall Street bankers do not like him, and he has hit the international bankers right square between the eyes. The Republican Party does not like him. So are you going to line up with all these groups and jeopardize the whole recovery program in order to try to help the Federal employees get the remaining 10 percent of the 15-percent reduction at this time when they will possibly get it under this bill, anyway. [Applause.] THE PRESIDENT WITH A GOOD PROGRAM No President has done more to help laborers, wage earners, farmers, low-salaried people, and just the average man. woman, and child of this country generally than President Roosevelt. I do not agree with him on some of his views in regard to veterans' legislation and reduction of pay to low- salaried Government employees. It seems inconsistent for the Government to reduce pay of low-salaried people and at the same time encourage private industry to increase the pay of low-salaried people. Although I do not agree with the President on some things, yet I believe that he is doing as much to bring this country back as is possible for a President to do. One thing sure, Wall Street representa- tives cannot go into the back door of the White House and find out what is going to be done in order that they may defraud the people on the stock market by having the in- formation in advance. It is the first time in 12 or 13 years that Wall Street has not had entree to the White House. The President is fighting the battles of the plain people of this country— the poor, the needy, the unemployed, and the ones in financial distress. He is on record in favor of in- dependent business, regulation or prevention of speculation on products of the soil, and restoring the same kind of dollar to the people to pay their debts with that existed when the debts were created. He is at least doing something. He is not sitting down twiddling his thumbs, as some of our former Presidents did in great emergencies. He will prob- ably make mistakes. He has asked the people not to expect him to be right all the time. XXACT JUSTICE NOT POSSIBLE The people cannot expect exact justice to be administered by human beings in compliance with general laws for the whole country. ITiere will always be just and meritorious complaints of inequalities and injustices. The broad pro- gram, however, is against the rotten, crooked, unscrupulous politicial and financial management of the past and in favor of the general welfare. WHO WTLL BE PLEASED WITH THE PRESIDENT'S DEFEAT It would be very pleasing indeed to the Mitchells. Morgans, Mellons. and Wiggins for the President to suffer defeat. It would be pleasing to aU Wall Street bankers and other credit manipulators and international scoundrels for the President to suffer this temporary defeat, and it would especially be pleasing to the Republican Party and all others who are interested in voting against the President for the sole and only reason that it is good political strategy on their part. I refuse to join the President's enemies, and although I do not agree with all of his program in every detail, I am going to hold up his hand and assist him in his efforts to give the country substantial and lasting prosperity. Mr. RANSLEY. Mr. Speaker, I yield 5 minutes to the gentlewoman from California [Mrs. KahnI. Mrs. KAHN. Mr. Speaker, everyone realizes the necessity for government economy and would not cavil at it under ordinary circumstances, but when in extragovemmental activities we find money is being paid to the employees far in advance of the money paid to the regular govenimental people who are doing a faithful work, we realize that this difference in pay breaks down the morale and is bad for the efficiency of the Departments. I should like to give a few flgiures showing these dis- crepancies. Under the 1930 Classification Act we find clerical and mechanical services paid, grade 1, 55 cents to 60 cents an hour; grade 2, 67 to 70 cents an hour; grade 3. 75 to 80 cents an hour, less the 15 percent reduction. Under the schedule paid by the extragovemmental activ- ity, the Civil Works Administration, we find that the maxi- mum time for working is 30 hours a week, with certain administrative exceptions, and for purposes of wages the covmtry is divided into three zones, and the authorized maxi- mum pay in each zone is given with their equivalents per month, per year, maximimi working time. Now, we realize that the maximum pay is really the mini- mum. In the southern zone skiUed labor such as I have designated is paid $1 an hour, $135 a month, or $1,560 a year. In the central zone skilled labor is $1.10 an hour, or $148 a month, or $1,716 a year. In the northern zone labor is paid $1.20 an hour, $162 a month, or $1,872 a year. Cleri- cal work is paid in the northern zone $968 a year, $1,092 a year, and $1,240 a year. Now compare this with the civil-service salaries with 17 percent of the employees receiving less than $1,000 a year base pay, 25 percent getting less than $1,200 a year base pay. and 60 percent getting less than $2,000 a year base pay. The newspapers of January 8 contain an announcement that the P.W_\. is spending $58,000,000 giving employment to 280,357 men. That would be at a cost of $242 a month per man. Study the tables inserted and draw your own conclusion. Now, it seems to me that at least a smaU portion of this great siun might be used to restore the 15 percent cut and relieve the suffering of the Spanish War veterans and the widows and orphans. [Applause.] I insert the following figures: nCURES ON Civn. service and EMERGINCT pat ROLLS As of January 1932 there were 732,460 persons employed in the civil service receiving salaries as follows: Up to 11,000 124,678 ti.ooo to $1,100 - ;y,l^ $1,100 to $1.200 - 12. 157 $1,200 to $1.300 37. 558 $1,300 to $1.400 — — 20.243 $1,400 to $1.500.._ - 24.043 $1,500 to $1,600. - -— - — 24.044 $1,600 to $1.700 28.398 $1,700 to $1,800 20.023 $1,800 to $1,900 35,690 $1,900 to $2,000 - - 32, no Up to $2,000 (60 percent) *oI" ?«« $2,000 to $2.100 — 2*-^M $2,100 to $2,200 ^^°' '^^ Up to $2,200 (76 percent) ^f?' n?« $2,200 to $2.300 -• ni'^nl $2,300 to $2,400 oo'oo? $2,400 to $2,500 2J, 2^ $2,500 to $2.600 *l- t"^ $2,600 to $2,700- — ^I'll^ $2,700 to $2.800 I'l^ $2,800 to $2,900 ^•^; $2,900 to $3.000 — ^'^^* Up to $3,000 (95 percent) - ^®^- ♦^^ $3,000 to $3.100 - 3.51^ $3,100 to f3.200 - i'V?^ $3,200 to $3,300_ *•♦»* $3,300 to $3.400 f ?3i $3,400 to $3.500 }fi^ $3,500 to $3,600 J»?I $3,600 to $3,700- - ^'^^ TJrvTTOT? li i fe- ll 496 CONGRESSIONAL 936 1 $3,700 to »3. 800... - - --- _ 2.875 $3,800 to $3.900 - -- ""' 251 $3,900 to $4.000-— - 720,863 Up to $4,000 (98 percent). ^^.^g $4,000 to f4.100 '"IIIII 153 $4,100 to t4.200 - 872 $4,200 to M 400 -_ " 722 $4,400 to $4 600 - 2 250 $4,600 to S4 800 j' 286 $4,800 to $5,000- . ___ 727,724 "■ _ .. 919 " 374 ■ ' 311 ._ 905 _ .. 303 693 ^^^ 244 "" 150 jgg 133 jg^ " 6 .. 41 31 RECORD— HOUSE Januari 11 Clerical wages are authorized to be paid as follows: Up to $5.000--- --- $5 000 to S5.200 $5 200 to S5400 $5,400 to $5.600--- $5,600 to $5.800 - $5,800 to $6.000 $6,000 to $«.500 $6500 to «7.000 $7 000 to $7.500 $7,500 to 58.000 $8,000 to $8.500 $8,500 to $9.000 $9000 to $10.000- $10,000 to $11 000-- — $11,000 to $12.000 $12,000 to $15.000 — $15,000 and up ENBOLLMENT, COST. AND PAT OT THS CIVILIAN CONSERVATION COKPS Average enroliinent is approximately 300.000. The cost of the first 8 months, April through November, is given as $186,000,000. or an average of $25,250,000 per month. . _„ -„ Th's makes an average cost per man per month of $7 (.50. Wages are paid the men at the rate of $30 base pay. $45 for 5 percent of them, and $36 for an additional 8 percent. At these rates the monthly pay roU would be: at $30 $9,000,000 225,000 144,000 Baa* pay for 300,000, Adclltionr.l $15 for 5 percent- Additional $6 lor 8 percent--. 9, 369, 000 Total, pay roll Deducting this from total monthly expenses, we have ap- prox mately $13,881,000 for expenses other than pay rolls, This is an average of $46 per month per man. presumably lai-gely for food, shelter, maintenance, clothmg. and so forth Assuming that a man's necessities, and so forth, procurec at this cost are worth $46 a month to him. the CC.C. work ers receive in cash or in value pay as follows: Monihiy Pip?n.>«>s of fool, shelter, maintenance, * c!o;hit;|!. elf . P«'r nian MouUiiy t«i3e v«»y and extm allowances. Total per month Total, per year 5 per«nt of workers s percent of workers Remain iler of workers Southern tone Central /.one.. ■ Northern zone - Northern loae. equivalent annuity. - Base Inter- meijiate $12 1.1 IS 056 $15 13 21 1.092 Oper- atiDK $24 1.240 Super- vision $18 21 Tech- nical suT*r- vision $lS-$35 21- 40 24- 45 2.340 In comparison with the Army and Navy, even a stronge|r picture could be presented. WAGES PAID BT THK CIVIL WOrjCS ADMINISTRATION The maximum working time for labor is 30 hours a weet. with certain administrative exceptions. For purposes c wages the country is divided into three zones, and the at thorized maximum pay in each zone is given as follows, wit i their equivalents per month and per year, maxunum workirjg time: Souih#m loce: Skille^l I ivskille*!... Central lone; SkiUe«l la-kill«d... Northern rone: Skillctl Vnskaied.. Compare with civil-service salaries, with 17 Percent of employees receiving less than $1,000 a year base Pay. 25 per- cent get less than $1,200 and 60 percent less than $2,000. PUBLIC WORKS ADMINISTRATION. MISCELLANEOUS Nev.'spapers on January 8 cite an announcement of the PWA that it is spending $53,000,000 in nongovernmental projects in 41 States, thus giving employment for 1 month to 240,357 men. This would be at the cost of $242 per man per month. , „„ „„5^. Un-'er cinl ser\-ice clerical-mechanical services are paid. Grade 1, 55 to 60 cents per hour; grade 2, 65 to 70 cents per hour; grade 3. 75 to SO cents per hour. Less 15 percent, 1930 classification skilled labor. ^f„„^o Mr E'^>rKHEAD. Mr. Speaker, how does the time stand.' The SPEAKER pro tempore (Mv. Thomason) . The gentle- man from Alabama [Mr. BankheadI has 43 minutes remain- ing and the gentleman from Pennsylvania [Mr. Ransleyj 53 minutes remaining. . +^ *>,„ Mr. RANSLEY. Mr. Speaker, I yield 8 minutes to the gentleman from New York [Mr. MeadI. Mr MEAD. Mr. Speaker. I regret exceedingly to find that mv position on this legislation is in opposition to our majority members of the Rules Committee. But I am of the opinion that this rule is not necessary to put over the President's recovery program. I do not think that his pro- gram needs any such gag rule. In addition to that, my opposition to this rule is based on the fact that as chairman of one of the legislative com- mittees of the House I do not believe that I have the moral right to preclude that committee of the possibility of con- ! sidering legislation from now until the termination of this ■ Congress by my act in voting for this rule today. I am opposed to this rule because it runs from now on and only terminates when we stop work at the end of the session. ., _^^. Another objection is that we have before us m the Post Office Committee legislation which may be approved by the Postmaster General, and perhaps after a conference with the President it may receive his support, but with this rule adopted we may be prevented from taking any such action Mr McPARLANE. Mr. Speaker, will the gentleman yield? Mr MEAD. No; I am sorry. I have only a few minutes. Let me tell you of some of the discriminations that affect postal employees which are unfair and unjust, because they are caUed upon to suffer all out of proportion to what most of you Members may realize. The postal employee will not only be called upon to suffer his 10-percent cut, but there wiU be the continued hazard of the furlough cut hanging over his head. In addition to that, the ban against promo- , tions in the service will be hanging over his head, and m I addition to that there is a reduction in the travel allowance in the Railway Mail Service for those men who hve away from home nearly as much as they live at home. In addi- tion to that no one may be promoted to a supervisory gi-ade in the Post Office Service except by Executive order, so that some clerks might be performing the duties of a supervisor, assuming the added responsibilities, and yet by a continua- tion of this program he will draw only the salary of a clerk. In addition to that, the postmasters have not only suffered the pay cut, but they also suffer a 10-percent cut in the receipts on wloich their salaries are based. In addition to that the pay schedule and grade of the supervisor m the substation is based upon the number of employees, and the positions made vacant by the retirement of regular em- ployees are filled by substitutes, and that employment does 1934 CONGRESSIONAL RECORD— HOUSE 497 not count in determining the number of supervisors in that office, nor docs it count in determining the wages of the supervisory officials in such offices. So, by reason of this rule, I believe we perpetuate not a 10-percent wage cut, but a wage cut that runs all the way from 20 to 25 percent in the Postal Service. In order that we might approach this question in an in- telligent manner, our committee is anxious to take up such discriminations with the Post Office Department and with the President of the United States, and how inconsistent it would be if I should prevent my committee and the Presi- dent and the Postal Department by my action from further consideration of these matters. Another question I desire to bring to your attention is the conditions of our substitutes. It is the most deplorable situation we are called upon to meet. The most pathetic figure in my judgment in the employ of the United States today is the poorly paid post-office substitute. No matter where you go, you will find men in every walk of life con- demning the Congress of the United States for the inde- fensible position we find ourselves in in condemning these men to the meager wages which they are receiving as a result of the Economy Act. Postal substitutes are receiving all the way from $1 to perhaps $20 a week. The average is very low. They are on our charity relief rolls, and in these days of recovery and reform, I merely want to have the privilege to legislate on conditions that are certainly intolerable and indefensible. So I say to you, a rule such as the one we are now consider- ing that applies today, tomorrow, next week, and next month in my judgment is an unjust rule and ought not to be sup- ported by those who believe in eliminating unfair, unjust discriminations in the Postal Service, the Federal service, the Veterans Administration, or any other service. [Ap- plause ] . Mr. STUDLEY. Mr. Speaker, will the gentleman yield? Mr. MEAD. Yes. I yield. Mr. STUDLEY. I understood the gentleman to say that some of the substitutes of the post-office employees are on the charity rolls. In New York they cannot get on the char- ity roll if they are employed by the Government. They have applied to me and asked if anything could be done, men who earn as low as $5 a week and have families to support. Mr. MEAD. I am in thorough agreement with my col- league from New York. Being a postal substitute is a handi- cap under existing law, because the minute he tells the em- ployment agency, the welfare or relief officers that he is a postal employee he is unwelcome and he cannot receive the consideration which other citizens are entitled to. Mr. WEIDEMAN. Mr. Speaker, will the gentleman yield? Mr. MEAD. Yes; I yield. Mr. WEIDEMAN. I wonder if the gentleman, as Chair- man of the Postal Committee, has thought of remedying this situation. Tlie Civil Service Commission is continuing to hold examinations for postal employees while there is a great surplus of substitute carriers. I wonder if the gentleman would not introduce a bill to take care of that situation so that before we create any more substitutes we will put these substitutes that we now have on a decent living scale. I think the Members would vote for a bill of that kind. Mr. MEAD. I thank the gentleman. He makes a good point, but we will not be able to enact such legislation under the rule. The SPEAKER. The time of the gentleman from New York has expired. Mr. BANKHEAD. Mr. Speaker. I yield 10 minutes to the gentleman from Virginia [Mr. WoodrumI. Mr. WOODRUM. Mr. Speaker, in 10 minutes I shall not be able to foUow my usual inclination and yield when- ever a coUeague asks me to, because I do think it very important to reiterate and clear up, if it is possible to clear up one or two very obvious misapprehensions with reference to .he effect of the proposed rule. In the first place let this be thoroughly understood, and I direct my remarks particularly to my coUeagues on the Democratic side. There is no possible question or shadow of a doubt about the fact that the President desires to have this legislation. Entirely separate and apart from what my individual idea about the merits of it may be, or yours, there is no doubt about that fact, because the Chairman of the Committee on Appropria- tions in company with the subcommittee chairmen, waited upon the President and conferred with him at length. He considered the matter deliberately and carefully, and heard there from some of the members of that gathering some of the arguments that have been made here today, and the President considers a continuation of these provisions of his economy program absolutely essential for the next fiscal year. I do not hesitate to say to you, as I said to the Presi- dent, that I should like to see the full amounts for salary restoration July 1 put in the bills, with the continued right in the President to make reductions if necessary, but. gentle- men, we are in war today, an economic war. just as we were some months ago. It is true we have advanced. Many of the people who were then starving are now eating, but it is no time for me, a private in the ranks, to undertake to distract the attention of the Commander in Chief on a matter of strategy. I must, if I am a soldier, yield my individual opinions at cer- tain points, and that is what the President has asked the Members of Congress to do today. Mr. McFARLANE. WiU the gentleman yield? Mr. WOODRUM. I cannot yield in 10 minutes. Now, let us get one matter definitely out of the way right now. There is absolutely nothing in this rule which in any way precludes any effort that anybody desires to make to reinstate veterans' relief. If any gentleman wishes to chal- lenge that, I will 3^eld to him. Mr. MAY and Mr. CONNERY rose. Mr. WOODRUM. I yield to the gentleman from Massa- chusetts. Mr. CONNERY. This rule precludes an amendment to this appropriation bill. Mr. WOODRUM. No, sir; it does not. I know the gen- tleman is sincere. This rule precludes amendment to title II of the Economy Act. Title n is not the veterans' part of the Economy Act. Mr. CONNERY. Yes; it is; I beg the gentleman's pardon. Mr. WOODRUM. No; title H is not. Title I is the part of the Economy Act dealing with veterans. Mr. O'MALLEY. Will the gentleman yield? Mr. WOODRUM. In just a moment I will yield. We will clear this up if you will bear with me a moment. When we get to the appropriating part of this bill the gen- tleman from Massachusetts [Mr. Connery] can offer a mo- tion to put back $200,000,000 for veterans' relief, if he de- sires to do it. Mr CONNERY. But when we pass this rule now, we practicaUy put into effect everything that was In the economy bill that was passed last session? Mr WOODRUM. No, no; the gentleman is mistaken. May i call attention to this— this is where I think we have gotten the wrong impression about it: There were two dis- tinct and separate parts of the economy bill that was passed last year. Title I, or that portion dealing with veterans- relief and that was permanent legislation. Now, please bear that in mind. We delegated to the President of the United States authority to readjust payments to veterans and issue regulations thereon, which said regulations, when promulgated, have the effect of basic law. So it is not necessary now to reenact any portions of the economy bUl passed last year which have to do with cuts in payments to veterans, and they are not involved in the reenacted sections of this bill. The only sections here involved are those sections having to do with pay cuts and automatic promotions and other matters entirely separate and apart from veterans, with two exceptions— the cut for Civil Waf veterans and the cut on pensions paid by private bills. Mr. CONNERY. But we continue the veterans' situation as it was under the economy bilL Lxxvni- -32 .^Ni .tf^ m V ./^ v« «-«/■« <^ ▼ y^ % T A T t^t:i/^/>t>t^ TT/\Trc%T^ 11 -[C^M CONGRESSIONAL RECORD— HOUSE 499 VnskJled- ployees are filled by substitutes, ana rnat empiuymcut uuco 498 CONGRESSIONAL RECORD— HOUSE January 11 Mr. WOODRUM. We do not eontinue tt bj this rule. It Is continued anyway. Mr. CONNERY. But we stop any opportunity In this ap- propriation bill to get back the beneflu which the veterans lost In that economy bill. Mr. WCXDDRUM. Oh. no; we do not stop It at all. Mr. CONNERY. Then, why the rule? Mr. WOODRUM. Let me reiterate this, please: The cut In employees' sa-arles was a temporary 1-year cut. There- fore, unless we reenact that legislation for the next fiscal year the authority of the President to make that cut expires on July 1. This appropriation bill would have to carry 100 percent for the salaries; but the cut pertaining to veterans was basic law. and we do not have to reenact it. Mr. CX5NNERY. All right. Now. will the gentleman tell me. In this appropriation bill, how we could get back the benefits for the veterans? Suppose I should make a motion to raise the amount from $250,000,000 to $400,000,000. how can we get the money for the veterans? Mr. WOODRUM. You can raise the amount from $250.- OOO.OOO to $400,000,000, but you cannot by legislation on an appropriation bill, change the basic law. Mr. CONNERY. That is why I say we shotUd vote down the rule and get this thing discussed right. Mr. WOODRUM. But this rule does not affect that. The rule has nothing to do with that. Mr. CONNERY. Yes, it has. It gags you any way you look at it. Mr. WOODRUM. If the rule were not here at all and we came down to the section of this bill relating to veterans %nd the gentleman from Massachusetts got up and offered a motion to pay SpanLsh-American War veterans $60 a month, the motion would be out of order because it would be legislation on an appropriation bill; but the gentleman could provide $100,000,000 for pension payments, and that would be in order, entirely separate and apart from this rule. Mr. CONNERY. That would lie dormant and nothing could be done about it unless the economy bill were changed. Mr. WOODRUM. You can do that under this rule, if it is adopted. Mr. CONNERY. Does the gentleman mean we can change the economy bill? Mr. WOODRUM. No. This has nothing to do with the portions of the economy bill relating to veterans. Mr. CONNERY. But I say that money would lie dormant and nothing would be done imless you repealed the economy bill. Mr. McSWAIN. Will the gentleman jrleld for a question for Information? Mr. WOODRUM. Yes; I yield. Mr. McSWAIN. Assuming that this Congress should, be fore it adjourns, enact legislation that wo;ild modify the basic law with regard to benefits for veterans, nowhere, by any appropriation bill, can we get the money to pay the amounts created by such basic law if we cannot offer an amendment to any subsequent appropriation bill. Mr. WOODRUM. This will be the situation: The rule prevents any deviation from the economy bill, but it does not hit the veterans at all. I will have to answer the gentle- man by sajrlng what J said to the gentleman from Massa- chusetts [Mr. CoifHxstl. that we have not precluded any , veterans' reUef by the passage of this rule. \ Mr. McSWAIN. But assume that this Congress should I^ass some remedial legislation to correct injustices that everybody under the sun admits exist, where wHl we get the money to pay them? Mr. WOODRUM. Appropriate It. There is nothing to stop it. Mr. O'MATJiKY. But you cannot get It under this rule unless it comes from the Committee on Appropriations. Mr. WOODRUM. Oh. yes. Mr. OliCALLEY. It says any amendment to any appro- priation bill from now on Is out of order, unless offered by the Committee on Appropriations. Mr. WOODRUM. No; It does not say anything of tb« kind. It says: Any «mendment to any appropriation bill In conflict with tbOM MCtlonj therein enumerated— Which have to do with salaries, not veterans' payments. Mr. HEALEY. Mr. Speaker, will the gentleman yield? Mr. WOODRUM. I yield. Mr. HEALEY. I understand from the gentleman's ex- planation that under the veterans' section you could appro- priate $200,000,000 more, or any amount you wanted to, but it would serve no practical purpose because you could not legislate as to how the additional appropriation should be used. Is this correct? Mr. WOODRUM. That Is correct, and may I follow the gentleman up and say there is nothing whatever to prevent Congress at any time, if it is so advised, by legislation to change the basic law with reference to that or any portion of the economy bill. Mr. HEALEY. But by Increasing the appropriation you would not be doing the veterans' cause any good. Mr. WOODRUM. Not a bit. Mr. HEALEY. Because you cannot direct how it shall be used. Mr. WOODRUM. Exactly. Mr. McFARLANE. Mr. Speaker, will the gentleman yield? Mr. WOODRUM. I yield. Mr. McFARLANE. I call the attention of the gentleman from Virginia to this provision of the rule: Amendmenta shall not be In order to any other Bectlon of the blU HJl. 8663 or to any section of any general appropriation bill at the Seventy-third Ckjngress which would be in conflict with the provlslona of title II of the bill HJl. 6663 as reported to the House, except amendments oflered by direction of the Committee on Appropriations, and said amendments shall be In order, any rule of the House tou^he contrary notwithstanding. This is my question: Let us say we pass a bill to repeal the Economy Act; we get to the door of the Treasury; we are trying to pay these boys something; but If this rule is adopted, what good will it be to pass in the future a bill amending the Economy Act if you are going to nail the lid on and let the Appropriations Committee control the situ- ation? Mr. WOODRUM. I think the gentleman has asked a very fair and a very important question. There is not any doubt about the fact that if you pass this rule you close the door insofar as those sections of the Economy Act are con- cerned, unless and until the Congress shall repeal or modify the Economy Act, but there are no sections in here involved with reference to veterans. Now, why the necessity to make this rule apply to succeeding appropriation bills? We must have some uniform policy with reference to appropriations. You do not want the independent offices bill to carry a restoration to 90 percent and the Interior De- partment bill to carry a restoration to 100 percent, and some other bill to carry ^some other percent. This rule is neces- sary for the purpose of establishing conclusively that you are going to back the President in his proposal to give back 5 percent to the employees July 1, and then have the right to reinstate so much of the remaining 10 percent in the next fiscal year as the cost of living may Justify. [Applause.] [Here the gavel fell.] Mr. MARTIN of Massachusetts. Mr. Speaker, I 3^eld 3 minutes to the gentleman from Wisconsin [Mr. Boileau]. Mr. BOILEAU. Mr. Speaker, this rule is the most vicious thing I have seen in my short sen'ice in the House. To my mind it is a challenge to any man or woman in this House claiming to have a mind of his or her own. It is an insult to the Membership of this HoJise, and particularly to the membership of the majority party. Leaders of the majority party, and particularly the dis- tingiiished Chairman of the Committee on Appropriations, the gentleman from Texas [Mr. Buchanan], said he was not worried about the attitude of the majority Members. Ap- parently he feels, according to that statement — and he as ^M-v.^'&v A «• ■w\Trtr%/'\'T%T\ TT/\TTC1T7' Taxtttapv 11 Lxxvm- 1934 CONGRESSIONAL RECORD— HOUSE 499 much as sayi lo— that he has you under control. Were I a member of the majority party, I would resent very much such an inference. I believe, however, that any man or woman who votes for this rule is admitting that he or she Is under the direct control of the leaders: and I do not be- lieve this should be the attitude of. or that it Is even the privilege of. Members of Congiess sent here to represent their constituencies. I do not believe ihey have the right, even if they choose to do so, to surrender their prerogatives as Members of Congress. I do not believe they have the right under the Constitution of the United States, under our theory of government, to surrender to the Appropriations Committee, or to any Individual or group of individuals, the control of their votes. I believe every liberal-minded man and woman in this House will from the bottom of his or her heart resent any such gag rule as that proposed here this afternoon. I hope a sufficient number of Members on the Democratic side of the House will join with us on the other side to vote down this rule. The Democrats have a majority of over 200. Certainly this should give them a large enough majority to pass such legislation as their lead- ers might want without putting the gag rule into effect. It seems to me that to presume to bring in such a rule as this is tantamount to saying they do not trust their own Members to vote according to the dictates of their con- sciences. [Applause.] [Here the gavel fell.] Mr. BANKHEAD. Mr. Speaker, I yield 3 minutes to the gentleman from Tennessee [Mr. Browning]. Mr. BROWNING. Mr. Speaker, if we are opposed to limiting restoration of the pay of Federal employees to the 5 percent the President proposes, we are justified in oppos- ing this rule; but I do not concede that anyone Is justified in opposing it on the ground that it will bar them from appropriating for the relief of veterans in response to any legislation that may be passed this session. In other words, it does not affect that. Mr. McFARLANE. Mr. Speaker, will the gentleman yield? Mr. BROWNING. I cannot yield. I am sorry. Mr. McFARLANE. I want to clear up a matter. Mr. BROWNING. I am quite clear. The gentleman is the only one who is muddy. The only question involved is whether you want now to lay down a uniform rule for the session with regard to the question of increased pay for Federal employees or whether you want this question to come up on every appropriation bill and in different amounts for each department of the Government. Veterans* legislation is not affected. Even if it were cov- ered, even granting for the sake of argument that veterans' legislation were included, the Appropriations Committee would be obligated to make any appropriation the House may direct them to make from now to the end of the ses- sion: and I believe the Chairman of the Committee on Ap- propriations will stand up and tell you so, if you ask him. I thing everybody recognizes this to be the rule. If any part of the veterans' program is covered by the rule, the Appropriations Committee will be bound to make the appro- priation under this rule for any added benefits. Further- more, if the House defies the Economy Act and restores some of the veterans' benefits taken from them last session, the Committee on Appropriations will be glad to follow the mandate, and we need have no concern about it now. This is just a plain question of the amount of increase that we want to vote for Federal employees, and the veterans' compensation is not in it at all. Do not confuse the issue. There is no way of getting it in here. The matter is entirely plain that veterans' increases made by direct legislation can be covered by the Appropriations Committee under this rule and will be. They are commanded to do it. I will ask the Chairman of the Appropriations Committee [Mr. Buchanan! if it is not a fact that his committee recognizes, and will recognize, the obligation to bring in an appropriation for any authorization made for veterans in this session of Congress? Mr. BUCHANAN. If the legislative Committee on Veter- ans' Affairs, or any other committee, brings in a biU which passes the House aiul beoomei a l«w authorisinff an ai^ro- priatlon for the veterans, or anything else, I. as Chairman of the Appropriations Committee, would feel It my boimden duty to report back to this House for action an appropria- tion bill carrying out the mandate of Congress as expressed In the bill. [Here the gavel fell.] Mr. McSWAIN. And that completely answers the Inquiry I made of the gentleman from Virginia [Mr. Woodrum]. Mr. RANSLEY. Mr. Speaker, I yield 5 minutes to the gentlewoman from Massachusetts [Mrs. Rogers]. Mrs. ROGERS of Massachusetts. I have not the time to go in detail into the effect of this legislation, but if there was a mirror right in front of you gentlemen the answer would be there. I wish you could just see your own expressions. You look terribly worried. You know perfectly well that besides stifling your voice this gag rule is contrary to your true con- science and is un-American. And you will be deliberately gagging yourselves. I would have a good deal of pity for you if you were not able-bodied men, but you are able-bodied men. You can get up here on the floor of the House and fight, and fight hard, but when regulations concerning the veterans were rewritten, in effect they gagged disabled men and women and elderly widows. Those men and women were bound hand and foot by administration regulations and thrown into the river, so to speak, and told to swim for their compensation. Why did I have a man in my office In Washington all summer to help the veterans with their cases? They were sick mentally and physically. They were not able to fight. Why did I have a man in my office in Lowell in order to help the veteran men and women in my district? They were disabled. There were widows and children. They did not have a chance to fight for themselves. They did not un- derstand the law. They were bewildered and living in fear of the future. They did not understand the regulations. They did not know how to present their claims. They could not secure a sufficiently long hearing of their claims without the assistance of a Member of Congress, or his or her repre- sentative. This was necessary in order that even just a little time might be given to the presentation of their claims. It was really pathetic. You know how rapidly those claims were settled or were not settled at all. Do you realize there are 24,000 forms filed by Spanish War veterans for a review on appeal now pending before the Bureau? You know that the boards did not have time to decide the merits of these cases as they were told that the cases must be finished at a very early date. Many cases should be reviewed again. You and I know that the doubt always had to be resolved in favor of the Government and not in favor of the veteran. In other words, the veteran had to prove his case. That is why I have extra people in my office to assist me. There are so many veterans I cannot help them all by myself. Why bind yourselves to keep quiet so far as the Federal employees are concerned? Take the substitute carriers in our various post offices, for instance. Do you know that I have been told that the average pay of the substitute carrier is $1 a day? Think of it^$l a day! And those substitute carriers have to report at 7 o'clock in the morning and must not leave until 12 o'clock noon and be avaUable all during the day. How can they earn money any other way? That is the plight of some of our postal carriers. You know how greatly overworked the regular letter carriers are as a result of the Economy Act and its effect in the Postal Department. You also know that business firms are not able to have their business carried on satisfactorUy because they do not have the late evening mail collections. This is also due to the economy program. If those collections could be made. It would mean work for the substitute carriers. The business of the country could be carried on much better. You know the number of men who are actually sick or practically sick on duty carrying maU, particularly in the very severe climates, because their work has been so arduous. It has been cold in New England this winter with a lot of snow. You can appreciate the hardship that has been endured there by these men. ■>' % ^ r\e\ t r\r\\.inv>-cooirvKJ Kl "DTTT'n'D'n unTTQIT. R01 500 CONGRESSIONAL You men and women bavc strength. You have rtrength to ttght for what you want. You know very weU that you do not want to vote to gag yourselves, not only for to^y or for future appropriation bUls. You know you do not. Ptease vote against this rule. I urge you to assert your manhood and your womanhood. How can you go back to the people of your district and face your veterans, your Federal em- ployees? How can the genUeman from Texas, for instance, Ulk to his veterans? . „ *. ♦.. Mr. PATMAN. Will the gentlewoman from Massachusetts yield? The SPEAKER. The time of the gentlewoman from Massachusetts has expired. Mr. PATMAN. Will the gentlewoman from Massachu- setts.-state that she has never voted for a gag rule when the Republicans were in the majority? Mrs. ROGERS of Massachusetts. No. I never voted for such a rule as is proposed today. Mr. PATMAN. The gentlewoman has voted for a lot of gag rules. Mrs. ROGERS of Massachusetts. If the gentleman is go- ing to bring up the party feature. I will ask the gentlemar if he does not realize that the greatest benefits to our vet- erans accrued under the Republican administration? Thai is equally true of the benefits accrued to the Federal em- ployees. Mr. BANKHEAD. I yield 5 minutes to the gentlemar from New York [Mr. OComnor]. Mr. O'CONNOR. Mr. Speaker. I did not feel It necessar: to speak on the question of the rule until the last remarl of the charming lady from Massachusetts [Mrs. Rogers compelled me to Uke the floor. She had the audacity t< state that benefits to the veterans of the United State; happened — and that is the appropriate word — under Republican administration. Why. any benefits to any vet erans occurred after two thirds of every vote cast for th( benefit of the veterans came from this Democratic side o the House. Every benefit for the veterans had to be dragge< out of the Republican administrations since Harding. When the veterans shall erect a monument to their champion down here on the Mall, it will never be to a Harding, to Coolidge. to a Hoover, or to a Snell. It will be erected to thii credit of somebody like Wright Patman or Gordon BROwifi iKG or " Bn.1 " CoNmtRY. who sit on this Democratic side or the House, and not on the Republican side of the Ho [Applause.] When labor and the working people of our Nation sha erect a monument to its champion