its settlement on a purely factual basis. A decision must be arrived at on the basis of judgment, and in the last analysis this judgment must be exercised by the duly elected representatives of the people. The Brookings Institution is not submitting any formal recommendations on the subject because detailed facts alone do not determine the issue.

Now, this objective group, after an extensive study of both the Federal Security Agency and the Labor Department, could find no advantage, either administratively or economically for the transfer to the Labor Department. They indicated this decision should be left to the duly elected representatives of the people.

The Congress of the United States has twice since May 1, 1947, rejected similar proposals, and it is my considered judgment at this time that in the interests of economy and efficiency and good administration, and also in the interests of a fair and unbiased operation of unemployment-compensation laws, that this committee and the Congress should again reject this plan.

The CHAIRMAN. Thank you, Mr. Findley. Are there any questions, Senator Long?

Senator LONG. Yes, Mr. Chairman, I would like to ask this question: I notice that you are strongly opposed to some of these administrative cases where a man is drawing unemployment compensation although the man could be on the job working, or where he may be drawing compensation and has turned down suitable employment.

Does it not seem to you that if the same agency were administering compensation claims for unemployment and the placement of unemployed people, it would be easier to keep these people who are not deserving of unemployment compensation and who actually refuse to work, off the rolls?

Mr. FINDLEY. Senator, I believe that is exactly what we have at the present time. In other words, the Unemployment Services are at the present time in the same Division that is handling the unemployment compensation claims. The reorganization plan contemplates that both of these shall be transferred to the Department of Labor. In other words, it would not be different than we now have.

Senator LONG. I may say that in my State the Department of Labor handles both, and in the Federal Government, the Department of Labor handles one and the Federal Security Agency handles the other. I think that in the interest of consistency, it would be well for the two of them to work together.

Mr. FINDLEY. Senator, a couple of years ago, I believe you will recall, the Employment Services, by act of Congress, was taken away from the Department of Labor and transferred back to the States, where in most cases they are operated by the same department that is now operating the unemployment compensation law. That is the case in Illinois. So we have them there.

A point was raised a few minutes ago, in the questioning of the Secretary, regarding whether businessmen in general would not have more confidence if the Employment Service was in the Department of Labor. I want to say I do not think they would. We question the fairness, the absolute fairness of the Department of Labor, and, of course if the employers will not use the Employment Service, it does not make any difference where it is. You can consolidate it with

the Veterans' Administration, with their employment services, with anything else that you may have in mind, but if the employers will not use it, then it cannot possibly be effective.

Senator LONG. But it occurs to me that one of the main complaints that you are making is just as much and maybe more the fault of the employers than it is the fault of the laboring people.

An employer in my State recently complained to me about the very same thing you are talking about-a man quitting his job to go to some other State for a vacation, and drawing unemployment compensation. I asked him if he reported the matter to the Department of Labor. I discovered that he had not, so I reported it, and they immediately cut the man off.

Now, it just occurs to me that the Employment Service should be sympathetic to a laboring man, but at the same time it should be tough for those who do not want to work, and I believe that the Labor Department certainly recognizes that fact. They do in my State, at any rate.

Mr. FINDLEY. Senator, if we do away with experience rating, who is going to police that? Who is going to be concerned with it?

Senator LONG. Does this plan necessarily mean that we do away with experience rating? What makes you think that by putting the reorganization plan into effect that the experience rating would be abolished?

Mr. FINDLEY. Because of the recommendations that were made in this Thirteenth Annual Conference of Labor Representatives, which was under the auspices and conducted by the Department of Labor. They recommended that very thing.

Senator LONG. But the Department of Labor is not recommending

that.

Mr. FINDLEY. The recommendation was made by the Thirteenth Annual Conference of Labor Officials, who were meeting under the auspices and invited there by the Department of Labor, and I do not think that you can possibly imagine that they were not doing anything other than reflecting the opinion of the Department of Labor; and they recommended this:

The committee recommends that the experience-rating provisions be removed from State unemployment compensation laws.

I do not know what could be any clearer, Senator.

Senator LONG. But even if the Department of Labor wanted that done, that does not mean that this Congress will do it. I may say that they also recommended that the Taft-Hartley Act be repealed, but I think that you are aware that it is still on the statute books.

Mr. FINDLEY. It certainly does not follow, but we certainly do not want the umpire to be biased at the time he is chosen.

Senator LONG. It does not seem to me that the Department of Labor is the umpire; I believe that the Congress is the umpire here. And, as far as your people are concerned, they have always had a fair hearing from Congress, and they will continue to get a fair hearing. That is all, Mr. Chairman.

The CHAIRMAN. It may be noted at this point that the Secretary of Labor would not commit himself on this question this morning.

Mr. FINDLEY. That was the impression that I got.

The CHAIRMAN. At any rate, if he made a direct statement, I did not understand it.

Senator IVES. Mr. Findley was here when the Secretary was testifying, I believe.

Mr. FINDLEY. I heard the latter half of his testimony, Senator; I did not get in until 10:30.

Senator IVES. You should have heard all of it, because I think you perhaps heard the Secretary make the statement that he construed the obligation of the Administrator, or the administrating agency, whichever that might be, whichever Department it might be, was to conform to the statute itself, with a certain minima in the way of requirements that would be placed in the statute. Were you here when the statute was read?

Mr. FINDLEY. I was, Senator.

Senator IVES. I myself have been receiving a great many letters of apprehension regarding that particular angle, and that is why I went into the thing so rather exhaustively, to find out just exactly what the attitude of the Secretary might be. You heard the Secretary state, however, I believe, did you not, that he construed the requirements to exist whereby those minima, that particular section of the law, would have to be carried out?

Mr. FINDLEY. That is right.

Senator IVES. And then he stated that any plan which was submitted, as long as that plan came within the purview of that requirement, would have to be accepted. That is what I gathered from what the Secretary said. That being the situation, Mr. Findley, why do you fear the placement of this particular function or functions in the Labor Department? I think we will all agree that they should be together.

Mr. FINDLEY. I agree with that.

Senator IVES. I believe everybody believes that, I do not think it is debatable. Then why do you feel that it should not be in the Labor Department, if the Secretary makes such a statement?

Mr. FINDLEY. Senator, Secretaries come and Secretaries go, and the very purpose for which this Department was organized in the first place is a one-sided purpose. It was for the purpose of favoring the laboring man. Nothink is said about employers, and nothing is said about the public. Perhaps if Secretary Tobin were a permanent fixture, we would not have too much to fear, but when the Department is loaded in favor of labor as much as it is, and when we realize that, if the experience rating is knocked out, these funds and these claims and these payments can be so handled that they can be used for the benefit of one or other of the political parties

Senator IVES. How can that be done, may I ask? I do not like to interrupt the statement you are making, but I would like to know how that could be done?

Mr. FINDLEY. It cannot be done, Senator, as long as Congress stands at the hole in the wall and keeps back the flood waters, but we know that a Department, by constant pressure, frequently has an opportunity to get over a program that it has in mind. The thing that I fear, and the thing that the people I represent, I believe I can con

scientiously say, fear, is that as long as the people that are administering this particular function want to get rid of experience rating, they will keep constant pressure to get rid of experience rating, and some day it may disappear.

Senator IVES. Because of their influence in Congress?

Mr. FINDLEY. Yes.

Senator IVES. I thought the Senator from Louisiana pretty well answered that in connection with the Taft-Hartley Act.

Mr. FINDLEY. But Congresses do change. I believe we will have to admit that.

Senator IVES. I may say that some people have fought, and some people have hoped. I can speak very deeply on that subject. I hope that is corrected.

The CHAIRMAN. Senator Smith, do you have any questions?

Senator SMITH. I would just like to make an observation, Mr. Chairman.

It seems to me that we are not going on with our job or carrying on our responsibility if we say we fear such and such a thing, but do not do anything to correct it except to continue to spread the functions. Would it not be better to bring all the functions together and reorganize and see that the Department does what the Congress and the people want it to do?

Mr. FINDLEY. Senator Smith, if that could be done in such a way that the Labor Department was no longer impressed with the primary function of favoring one class of society in the United States, I think that might be advisable. I furthermore would like to say that, if all of the recommendations of the Hoover Commission had been adopted as a whole, I doubt very much if we would be here objecting to this one particular part, but when certain recommendations of the Hoover Commission are picked out, those that possibly-I am not saying "definitely"-have some political angle, or may be helpful to the political party that may be in power at the present time, then I think we have to look for, what shall I say, "the worm under the drip."

Senator SMITH. But the Hoover Commission was unanimous in its recommendation on this.

Mr. FINDLEY. They were unanimous in their recommendation, but the task force itself, that studied this, made no recommendation. But if you will read-you probably have-the recommendation of the Hoover Commission, the recommendation was based upon a desire or a belief that something should be done to increase the prestige of the Department of Labor, that so many things had been taken away that the Department no longer functioned in the same degree of importance, perhaps, as some of the other Departments. I think that is a very poor reason for recommending a transfer.

Senator SMITH. I think the task force did make some recommendations as contained in appendix P. I still feel that we cannot continue to evade these issues. We must face the issues and find the solution, rather than spreading, as we have been doing.

Mr. FINDLEY. Forrestal and Manasco, who were members of the Hoover Commission, had a minority report with regard to the matter of transferring the Selective Service System over to the Labor Department. Their conclusion was: "We believe that the Selective Serv

ice System should be an independent agency." Their arguments are practically the same as we have. In other words, it is a biased agency to start with. For the same reason, Forrestal and Manasco did not expand or extend their recommendation to include the unemployment services, but I think they very well might have.

The CHAIRMAN. Senator Schoeppel, have you any questions?
Senator SCHOEPPEL. No, Mr. Chairman.

The CHAIRMAN. Senator Long, do you have a question ?

Senator LONG. I would say that as far as the Hoover Commission report is concerned, certainly if we find some of the recommendations were not thoroughly worked out, we would not have to accept them. For example, I can show you one recommendation that is based on five assumptions, and three of them are obviously incorrect to anybody who knows anything about the matter. If you find an incorrect recommendation, you would not want to leave that in. But if you were to find a mistake in any recommendation, it would not follow that you would have to throw out the whole plan.

Mr. FINDLEY. My point was this: That the advantage of adopting the whole plan would be so great that maybe we could afford to take a little bitter with all of the sweet. But when a pick and choose of seven items out of several hundred recommendations is made and try to put them in effect, then I think we have reason to object.

Senator LONG. I believe basically you and I are in complete accord. That is, that what we should do with the Hoover Commission plan is to put into effect the recommendations that are sound and proved to be worthy while those, which in the light of further study do not prove to be well based on facts, should be rejected.

Mr. FINDLEY. I will agree with you.

The CHAIRMAN. I may correct one thing for the record. Reference has been made that the recommendation of the Hoover Commission was unanimous. That does not necessarily follow just because there was not a dissenting opinion written by the Commission.

In many instances a majority of the Commission favored some particular recommendation, whereas others were not fully satisfied by it, but they did not file any dissenting report.

I happen to know, because I served on the Commission. There was a general reservation printed in the last report, I believe, that indicated that in many instances where there is no dissent the report and the recommendations simply represented the views of the majority. and not necessarily a unanimous representation.

Thank you very much, Mr. Findley. Your prepared statement will be printed in the record in full at this point. (The statement is as follows:)

STATEMENT OF A. R. FINDLEY, VICE PRESIDENT OF WIEBOLDT STORES, INC.,

CHICAGO, ILL.

My name is Ray Findley, vice president of the Wieboldt Stores, Inc. I am chairman of the social security committee for the National Retail Dry Goods Association, and I am appearing for this association in opposition to the President's Reorganization Plan No. 2 of 1949. My appearance likewise is on behalf of the Illinois Federation of Retail Associations and the Chicago Retail Association.

94651-49-13