are unable to sell are to be purchased as provided in the next section. The purpose is to assure the increase in activity all along the line.

Section 8 establishes a Production Insurance Corporation as an agency of the Commission whose duties are to underwrite the expanded production. The Corporation will offer to each business in a participating industry a contract promising to take over, at stated intervals, at a price of not to exceed 90 percent of the maximum prices allowed under a program, any quantities within its minimum quota it is unable to sell. The Corporation may hold or dispose of such quantities in a variety of ways through subsequent resale to the businesses from which acquired, resale in the open market, distribution to those on relief, or holding over to a future period. In the last case such amounts are to be deducted from the quotas for the industry for the following year, to prevent the piling up of unused surpluses of any commodity. Where a participating business is unable to obtain necessary bank credit for its requirements, the Corporation may approve and guarantee such bank loans, under appropriate safeguards.

Section 10 provides for the licensing of businesses in participating industries. Where violations have been established, licenses may be refused, suspended, or revoked by the Commission after due notice and public hearing. Appeals are provided to the courts.

Section 12 provides for the readjustment of farm programs of the Department of Agriculture in line with expanding industrial activity, in order to assure adequate supplies of raw materials, bring about concurrent expansion in farm income, and increase the efficiency of marketing.

Section 15 provides that actions properly taken pursuant to this act will not be deemed violations of the antitrust laws.

Section 16 provides for the nonpartisan administration of the act. Section 23 sets up an advisory Worker's Rehabilitation Board to coordinate the action of various governmental bodies in the replacement of displaced workers, and provides for payments to displaced workers while undergoing retraining.

Section 24: In order to encourage adequate standards of housing and insure that the housing industry will take its part in the expansion program planned for the Nation, this section makes special provision for the expansion of building operations in the low- and medium-cost housing fields not covered by existing agencies. The construction of low-cost rental houses is to be encouraged by a guaranty for a 30 year period of the net income from properties constructed under standards set up by the Commission. The building of houses for sale is likewise to be encouraged through contracts with the Production Insurance Corporation providing that houses constructed under standards set by the Commission and which remain unsold after 1 year will be taken over by the Corporation at a price which safeguards the actual costs of the builder, but not his profit.

Section 25: The separability clause contains the provision that if section 5 of the act is declared invalid, the whole act shall fall. This is to assure the democratic control provided through the industry

councils.

Other sections cover various legal and administrative details.

It is clear from this abstract that this bill proposes to deal with unemployment in an entirely different manner than has our previous public action. It does not attempt to break up big corporations into

little ones or to hamper them in carrying on their regular business operations. On the contrary, it proposes to see that the productive capacity of our big-business units is turned loose to produce and employ men. It sets up means by which expansion in production can be made safe for business through Federal underwriting of increased production. At the same time it insures that the increased production will be moved into consumption by providing for higher wages and reduced prices. Yet the manufacturers are reasonably assured of increased profits, because with increased output and sales their costs will come down even faster than prices will be reduced. At the same time it assures farmers of increased markets for farm products and increased farm incomes-a much more satisfactory solution for the farm problem than the present program of subsidizing farmers in the place of providing adequate markets.

It is becoming increasingly apparent that the problem of unemployment is too big to deal with by any of the stop-gap methods we have used thus far. For a long time now we have had upward of 10,000,000 unemployed in cities, in addition to those on farms who are waiting for a chance at a city job. And even if industrial production should move up to a level of 130 on the Federal Reserve Board index, there would still be more than 6,000,000 nonfarm unemployed, and it is extremely doubtful that we will, even temporarily, reach a level of 130 under the single impulsion of the great governmental expenditures of the defense program.

The program here proposed, on the contrary, would provide for putting the entire 10,000,000 back at work over the next 2 to 4 yearsputting them back to work in private industry, and would not be any direct cost to the Government. The Government would be taking a certain amount of contingent liability in underwriting the increased production, but any losses it might incur would be much less than what it would gain in increased revenues and reduced relief costs from increased employment.

During recent years a number of different groups have begun to realize more and more clearly that much more positive action than has yet been undertaken was needed to start definite moves toward reemployment and full production. One of the first steps was taken by the American Farm Bureau Federation at its annual meeting in New Orleans on December 15, 1938. The first resolution they adopted read in part as follows:

Believing as we do that recognition of these principles by all groups, and translation of such recognition into action, is the only way out of our economic difficulties, we respectfully urge the President of the United States to call together representatives of industry, labor, and agriculture selected from a list of those recommended by the duly selected leaders of the three major economic groups, to discuss a program of action designed to promote economic balance between these groups on a basis that will permit full utilization of our great productive resources, and we further urge that in view of the serious effect of the present maladjustment, these representative leaders be kept in session until they have agreed upon such a program.

This important farm group recommended that the leaders of industry, labor, and agriculture be called upon by the President to prepare a program of increased production and employment. This resolution recommended two essential elements of the program which the Monopoly Control Act provides, (a) that leaders of business, labor,

and agriculture should participate in the development of a program, and (b) that it should be set up on a democratic basis.

It may be noted that the 1940 platform of the Democratic Party called for the same sort of action as the Farm Bureau advocated 2 years ago.

The American Federation of Labor in its Monthly Survey of Business has repeatedly called attention to this same problem. Thus, for example, in its February 1939 issue the statement was made:

What are the next steps to expand production? First, Government, business, farmers, and labor must work together. We need regular channels through which business thinking and labor thinking can reach the Government and take part in policy making. Business has its advisory council to the Department of Commerce who are being called in for consultation, but labor has no open door for making its views known to the Executive. It is for the Federal Government to take the initiative in bringing representatives of labor, as well as business, farmers, and others into its councils to develop practical measures for immediate industrial expansion. * * *

Any plan for industrial expansion must include labor. Democratic procedure requires that labor as well as business be represented and consulted by the Federal Executive. Labor's interest must be protected and wage gains must keep pace with rising production and profits. Any practical plan for expansion requires team work of all groups under Government supervision.

Similarly the June issue of the A. F. of L. monthly publication reemphasizes the same point as follows:

Sound recovery in an age of mass production can only come through planning to advance all economic groups and timing undertakings so as to provide consuming power to buy output. Such planning, as advocated in our last issue, has two important features: The National Planning Board is (1) representative, and (2) continuous. Representatives of businessmen, labor, consumers, farmers, industrial engineers, should have a voice in formation of policies. Steady progress in production and living standards cannot be achieved unless all groups cooperate to carry out a workable plan for these ends. Businessmen, in the May United States Chamber of Commerce meeting, brought out a number of points bearing on recovery; their counsel and cooperation is needed. Labor counsel is necessary to aid in directing national social and economic policy toward provision for human needs, higher living standards, and better work conditions. The advice of engineers, heretofore not utilized on the plane of national affairs, is essential in the difficult problems of national planning, organization, and coordination which lie ahead. Counsel and cooperation from consumers, farmers, and other economic groups is equally important.

The fundamental technique used in maintaining production in the Roosevelt administration thus far has been that of public expenditure. At the same time it is clearly apparent that spending or investment alone, unless done in far more tremendous volume than heretofore, cannot deal with the problem of 10,000,000 unemployed. The theory of lack of "business confidence" and that with "confidence" restored business will invest enough to increase activity is illusory. The testimony of Owen D. Young and Alfred P. Sloan, Jr., and other industrial leaders before the National Temporary Economic Committee here showed clearly that their industries do not need capital and are now investing as much as they see markets for their products. Regardless of what party is in power, it will be faced with the same economic problems we are now faced with. Regardless of what party is in power, it will have to develop a program to provide increased employment through a broad program including the correction of monopolistic practices.

It may be that we will not adopt such a positive national program until another great depression reduces industry and finance to desper

ation and leaves everyone willing to use strong and positive measures where weak and partial measures have failed. But whether we adopt a positive program such as this cooly and with foresight, or whether we adopt it hurriedly and frantically in the midst of another great depression, certainly it is important for it to be well considered ahead of time. This proposed bill is introduced in the hope that it will encourage the study and consideration of such proposals ahead of time so that if and when we finally do come to adopt them they will be as rational and sound as possible.

The program here proposed is complicated throughout by provisions for public hearings and participation in the central authority and in the industry councils of labor, consumers, and of business, and also by representatives of the Congress selected by that body; by provisions for votes and other procedures; and also by provisions of public hearings not only in each industry but eventually in each factory participating in the program. It will take longer to work out a program with all of this elaborate machinery, and the administrators will have many headaches in trying to compose the interests of the various groups who have to fight things out in various hearings and industry discussions. That is, however, part of the price we pay for democracy.

For what we must be constantly aiming at is not merely providing for economic security for the people but also maintaining freedom and liberty at the same time. The democratic process with its lumbering discussion groups and public hearings does provide means through which concerted action can be taken with the understanding and support of the whole people affected by the actions. Whatever one's views on its economic soundness, the A. A. A. program, with its township and county committees, and planning groups, and State and regional conferences, has shown that economic programs can be developed through democratic processes and that it is possible to plan from the grass roots up as well as from the top down. The Monopoly Control Act similarly provides for planning from the bottom up rather than from the top down. The democratic features in the bill do insure that such planning will give full voice and full opportunity to be heard to each participating interest.

The bill is so framed that unless the features of it which provide for democratic control stand the whole act becomes invalid. This is accomplished by a reverse separability clause. And furthermore there is no reason why a free democratic people should not be able by their own voluntary action to guard against the ravages of unemployment and the stagnation of nonproduction. Had a bill of this character been ready in 1932 and 1933 the people of the Nation-including the business leaders-might have welcomed it and it might speedily have brought us out of the depression.

There is good ground for a very real hope that by a scientific control of our monetary system and the flow of buying power to and from all groups of our people such a bill may yet be rendered unnecessary. But the bill is offered primarily as a basis for study, discussion, and consideration of the problem of private monopoly in what is supposed to be a free economy. For private monopoly deprives the Nation generally and other producers particularly of freedom quite as much as does governmental regulation. And private monopoly

though it undoubtedly has contributed much to technological efficiency-contains within it the germs of destruction for democracy unless that democracy can guide the activities of monopoly into nationally useful paths.

The cure for every form of subversive activity in this country-the cure for fascism, nazi-ism, communism-is jobs for our workers and the saving of the business and property of our other people. This, then, is the task of Congress. In a way it is its only task. And it is, therefore, the duty of every Member to work diligently at that task until at last we succeed. It is in this spirit that this bill is offered.

[H. R. 7504, 76th Cong., 1st sess.]

A BILL To control monopoly and to encourage and protect commerce among the States, in order to assure continuous economic prosperity and security, increase the national income, and promote adequate and ever-rising standards of living limited only by the productive capacity and natural resources of the Nation.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the short title of this Act shall be "Monopoly Control Act".

FINDINGS AND POLICY

SECTION 1. The Congress, after hearings and investigations, finds

(a) That the natural resources, technological processes and equipment, and productive capacities of the United States, if fully utilized and required to function in the public interest, will produce consumer goods and services sufficient to provide and maintain a high and more uniform American standard of living, will provide a full employment at adequate real wages for all able and willing to work, and will yield reasonable profits to invested capital;

(b) That there exist widespread involuntary unemployment and undersupply of human needs, disorganization of industry, business and finance, and wholly inadequate housing facilities for the bulk of our population, accompanied by low wages and low levels of living;

(c) That this involuntary unemployment and disorganization of industry have diminished the markets for the products of our farms and have thus burdened and obstructed the current of interstate commerce in these products. The restoration of employment and purchasing power in industry is necessary to restore the markets for, and interstate commerce in, our farm products and to assure an adequate income to farmers;

(d) That these conditions are created, among other things, by the existence of monopolies or monopolistic practices in many industries that burden, obstruct, and otherwise restrain interstate and foreign commerce, affect and injure the national general welfare, and undermine the standards of living of those who derive their livelihood from such interstate and foreign commerce; that these monopolies or monopolistic practices prevent economic coordination and exact excessive profits based upon undue restriction of production instead of reasonable profits based upon efficient use of capital invested;

(e) That private monopolies, monopolistic practices, and restraints on trade have resulted in unwarranted curtailments of production and employment, unwarranted advances in prices, unbalanced earnings by both capital and labor, the creation of excessive capital obligations, and restraints upon industrial developments and activities, all of which have prevented coordinated and constructive action in the public interest; and defeated efforts to promote full economic recovery; and

(f) That these private monopolistic practices and restraints on trade have resulted in an economy of scarcity and want where full employment and relative plenty for all are possible. Due to monopolistic practices of industry, the national general welfare is constantly endangered, interstate trade is obstructed, and chronic unemployment is produced. To promote the national general welfare and to remove these obstructions to the free flow of interstate and foreign commerce so as to increase the amount thereof, it is hereby declared to be the policy of the Congress to increase production of the monorolistic industries engaged in interstate commerce, to reduce and relieve unemployment, and to