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what so-called standards of living are, and I have heard them quoted for years. There have been many debates on it. There are various factors that you have to consider in trying to arrive at a correct minimum wage. It is not all on standard of living. For instance, I might ask the gentleman right now, if the standard of living schedule shows 3 years from now that 75 cents an hour would cover it, would you be in favor of making the minimum-wage rate at that time 75 cents an hour?

Mr. DAVIDSON. Frankly I do not know what I would do in such a circumstance. I would have to analyze it.

Mr. MCCONNELL. If you are going to use one formula for raising the rate, how far do you follow that formula in determining the rate? Are you going to change it downward at some later date or just how are you going to figure this out? If you are not going to change it downward, then you have to be modest in the rate to which you raise it, and we are trying to make something rather stable and not something that shoots up and down.

Mr. DAVIDSON. I believe I can answer your question in this regard: That if it was found some years hence that the amount of wages were in excess of what might be required for a decent standard of living, I then would no longer be concerned, frankly, with the minimum wage and I would be satisfied at that point, knowing that my people had been decently and adequately supplied with the necessities of life, to let the law of supply and demand come into play.

Mr. McCONNELL. Would you be for a lower minimum then?

Mr. DAVIDSON. No, I would let the law of supply and demand take care of that. But I am not ready or willing to let the law of supply and demand be the sole factor at such times as I find that people are unable to supply the necessities of life for their families and themselves.

Mr. McCONNELL. You are talking in one breath about the law of supply and demand as though it was something which is self-acting, and at the same time you are imposing an artificial law on top of it. You cannot put the two together. I can appreciate why we have a minimum wage law. It is a welfare proposition, and you are quite correct on that. But in considering that, you always have to take into consideration certain economic factors. And you yourself say that you would let the law of supply and demand take care of it. On that you have imposed an artificial law. That has nothing to do with the law of supply and demand.

I am asking you that simple question; if you are going to bring in a bill, at the present time, to raise the minimum wage to a certain figure, and justify it on the cost of living, the standard of living or whatever your figures indicate there, I ask are you also willing to advocate a lower mininmum wage if the standard of living rates are lower?

Mr. DAVIDSON. My present feeling is reflected in the answer I have just given you. However, labor has done precisely what you are suggesting. Now, in the United Automobile Workers contract, Mr. Reuther has a clause which ties the wage to the cost index of living, and he has taken some cuts as the cost of living index has gone down. He has done that. Labor has in some instances already taken the formula that you are suggesting. I am not quite clear as to whether or not I would do that when it came to national legislation, which

I say has for its only justification the necessity of giving the man who works, and the man who labors and has a family the wherewithal to purchase the things that are required for a decent standard of living.

Mr. ZELENKO. Judge Davidson, do you feel that there is any difference between raising a minimum wage and supplying additional income to a working family, than there is to giving tax benefits to business so that business can survive? Are they both not economic? What I mean is this: Mr. McConnell talked about raising the standards as a welfare measure. Do you not feel that they are both economic measures, and if you give tax benefits to business, you are permitting business to survive and prosper, and by the same token, are you not, by raising the minimum wages, giving economic benefits to the working man, which is the only way he can get it?

Mr. DAVIDSON. Well, the implementation of legislation

Mr. ZELENKO. It is no more artificial than giving tax benefits to business, is it not?

Mr. DAVIDSON. I was merely saying that the implementation of legislation to the laws of economics as we have been taught to understand them, is not new in the field of labor, in the field of business of business through taxation or in the field of farming.

Mr. ZELENKO. Do you not think that that is unfair, or perhaps a misnomer, when you classify raising the minimum wage standard for workmen as a welfare proposition, when doing the same thing for business in the way of a tax benefit is called economics or improving business? Are they not both made of the same thing substantially? It is making it easier to live, either business-wise, or wage earner-wise. Mr. McCONNELL. I would advise you to read his earlier statement in which he designated this as a welfare proposition. You evidently did not hear him when he said that and I was just quoting back to him what he stated. Is that not right?

Mr. DAVIDSON. My original statement is that the major justification for a minimum wage is to bring into line what a man earns and what he requires.

Mr. ZELENKO. It was not a question of whether he agreed with me or not. I was trying to get him to agree with me, and you to agree with me. I think this is entirely an economic proposition. I think that the minimum wage should be raised, if tax benefits to business are given, because giving a tax benefit to business is permitting it to live and to prosper as it should and the only way a worker can get a benefit economically is through a raising of his wage standard.

Mr. McCONNELL. Do you want to consider this an emergency move? This is permanent legislation. Tax relief laws for business have not been permanent bits of legislation, they have varied from time to time, up and down. Sometimes they get them and sometimes they do not.

Now, do you want to lower the minimum wage when the justification indicates it on the basis on which Congressman Davidson makes his standards of judgment for raising it? Is that what we want to do, or do you want to leave it up here regardless?

Mr. ZELENKO. I want to leave it up, because when I see business suffering, I will be interested. But the higher the wage goes, apparently, despite all of the crying, business is prospering, and it should.

Mr. BAILEY. The Chair recognizes the gentleman from Alabama.

Mr. ELLIOTT. I have no questions, except that I would like to say to Judge Davidson that I wish he would leave for the record the figures of the various cities, the cost of living and the various cities that you have, the ones you did not discuss.

Mr. DAVIDSON. I have them all here.

Mr. BAILEY. The Chair recognizes the gentleman from New York, Mr. Gwinn.

Mr. McCONNELL. I just yielded for a question.

Mr. GWINN. I have just one question, Congressman. If you put this on the basis of the need for a decent standard of living, at $4,000, of whatever it is, then you would apply that same rule to Congress requiring it to fix other prices if the labor is sold in terms of a commodity so that prices would also be regulated on a minimum basis?

Mr. DAVIDSON. Well, we are going a little bit afield in some of our definitions, Mr. Gwinn. I would prefer instead of saying that I based my argument on a welfare proposition, if I can just qualify that to say economic welfare. I feel that the answer to your question must be this: Where the economic welfare of the country requires legislation, and I cannot quite go along with my distinguished and very able colleague, Mr. McConnell, when he talks of permanent legislation. In my lexicon, there is no such thing as permanent legislation. We would be in a very bad way if there were. But we have had to lift the floor in many cases, as we have in the case of farm prices, and also to put a ceiling on occasionally when things get out of hand as they did with the rent laws. We legislate here for the general good and economic welfare of our country. This is basic, the return that the labor of an individual brings and what it will buy.

Mr. GWINN. But you would accept the principle that Congress should try to be wise enough to fix wages and fix minimum wages and minimum prices? For example, should we have a minimum rent if the rental property workers go out of business?

Mr. DAVIDSON. You know we have that in my State, and I do not know how many States have that. We do have a minimum-rent law as well as a maximum-rent law.

Mr. GWINN. Do you think Government should go into that business, of fixing such prices and determining what the fair standard of living is for the person whose living comes from various kinds of commodities?

Mr. DAVIDSON. We had to do it in my State, or there would have been riots. The landlords were gouging the people to such an extent that that was an absolute necessity.

Mr. GWINN. Was that a minimum or maximum?

Mr. DAVIDSON. The landlord is guaranteed a minimum return of 6.2 percent on the assessed valuation of the property, and he has a minimum guarantee, as well as a maximum fixation.

Mr. GWINN. And you are committed to the general philosophy of Government, fixing wages and prices in order to maintain what you call a minimum standard of living?

Mr. DAVIDSON. That is too broad, and I could not go along with that, not to the general proposition.

Mr. BAILEY. The Chair wishes to thank the distinguished Member from the State of New York for his frank and open discussion of the

matter before the committee. I think that I can speak for the entire committee that we have all enjoyed your testimony and it has been quite helpful.

Mr. DAVIDSON. Thank you very much.

(The tabulated information previously referred to is as follows:)

Cost per year of family budget of a city worker in 34 cities of the United States together with the required minimum hourly wage to meet this budget, based upon a work year of 2,000 hours (8-hour day×5-day week=40-hour week, 2,000÷÷40-50 weeks)

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And there has been a great deal of talk about runaway industry. Manufacturing firms leaving the North and going South. Well, let us look at the Bureau of Labor Statistics figures for nine of the great southern cities: These figures show that in these 9 cities the cost of supporting a family of 4 is higher than in my own New York, and this is bare cost-no extras allowed:

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Transportation___.

Housing (rent, gas and electric, house furnishings)
Apparel

Medical care..

Personal care (barber, toilet articles).

Reading, recreation (radio, TV, magazines).

Other goods and services (tobacco, legal, funeral) --

Percent

30. 1

32

9.7

11

4.7

2.1

5.4

5

NOTE.-The United States Government has not published data on cost of family budget since October 1951. The difference in costs of living given above is based on the 1.87 percent rise in the BLS Consumer's Price Index between October 1951 and April 1955.

Source: United States Bureau of Labor Statistics.

Cost per year of family budget of city worker in 34 cities in the United States (4-person family)

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NOTE. The U. S. Government has not published data on cost-of-family budget since October 1951. The difference in costs of living given above is based on the 1.87 percent rise in the BLS Consumer's Price Index between October 1951 and April 1955.

Source: U. S. Bureau of Labor Statistics.

Mr. BAILEY. The Chair now recognizes the gentleman from Pennsylvania, Mr. Flood, who will be the concluding witness at this session. STATEMENT OF HON. DANIEL J. FLOOD, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF PENNSYLVANIA

Mr. FLOOD. It is 20 minutes after 12, and I see a lean and hungry look around me, and I do not know how far I want to go. I have listened to this with considerable interest. Coming here from the mundane Committee on Appropriations, the rarefied atmosphere of these legislative halls is very invigorating.

I, of course, am a special pleader, and I would not want this committee for one moment to labor under the impression that I was not. I do not presume to approach this kind of problem with the aura of statesmanship or the mantle of economy, not for a moment.

Now, to enlarge upon the whole theater of this subject with this committee would be carrying coals to Newcastle with a vengeance. Even anthracite coal, and that would be very bad form. I am not going to try that.

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