Mr. O'HARA. By the application of what I think is commonsense. Mr. WAINWRIGHT. I have no further questions, Mr. Chairman. Mr. RHODES. I would like to ask our good colleague-first I would like to say I certainly enjoyed your testimony and the history which you have brought to the committee as to this type of legislation. It has been very helpful to me. I would like to ask you, though, how you came to the conclusion that we are on the verge of a depression? The statistics, for whatever they are worth, seem to indicate quite the

contrary.

Mr. O'HARA. Well, you asked me the question and so I am going to answer you forthrightly, because I think that I should.

I lived through the 1920's, and everything that I heard in the 1920's I am hearing repeated now. We had exactly the same talk of an expanding economy. And while we were hearing that talk, and things were booming in the cities, things were going badly on the farm. There were people then who were talking this expanding economy and the prosperity that would never differ. They were fighting such legislation as the type of this to provide the least of the workers with a minimum of at least $1.50 or $1.25 an hour so that they could make their contribution to the expanding economy necessary.

Now, it happened; the thing we did not want to have happen did happen.

Mr. RHODES. I certainly share your hope, that is all.
Chairman BARDEN. Are there any further questions?
Thank you, Mr. O'Hara, very much.

Congressman Davidson of New York.

STATEMENT OF HON. IRWIN D. DAVIDSON, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW YORK

Mr. DAVIDSON. My name is Irwin Davidson of the 20th Congressional District in New York. Mr. Chairman and members of this distinguished committee: I appreciate greatly the honor of being permitted to speak to you for a very brief few moments in behalf of the bill which you are now considering.

I believe, Mr. Chairman and members of the committee, that an increase in the national minimum wage is not only necessary but that it is overdue. I believe that that minimum should be increased to nothing less than $1.25 per hour. The same very valid reasons exist today for increasing the minimum wage as existed when the law was first passed. The long struggle to establish fair labor standards can be nullified if the minimum wage is allowed to stand at the unrealistic and inadequate level at which it now is. This committee, I am sure, is fully aware of the purposes of the Fair Labor Standards Act.

I will not take any of your valuable time in repetition. However, to be frank, if the law is to have any meaning at all for millions of Americans, it is essential that the minimum wage be raised now to at least $1.25 per hour. The urgent need for a realistic increase is not denied, but proposals which suggest amounts like 90 cents are not alone inadequate but I believe, are ill-considered. It has long been established that the most economical wage from the employers' point of view is a high and realistic one. Pennypinching wages are the best inducers of poor production I know.

The immediate need for the proposed increase is well established by the figures which are published by the Bureau of Labor Statistics. I have a table prepared for me by the Library of Congress. This table shows the actual cost as reported by the Bureau of Labor Statistics of maintaining a family of 4 in 34 representative cities of the United States. I have calculated the hourly wage which is required in order to earn the yearly figure which the Library furnished to me. This hourly rate is based upon a full year's work of 2,000 hours. With your permission, I would like to insert these tables in the record and if you will permit me, I will just mention a very few of them now. In Boston, Mass., the Bureau of Labor Statistics said that the cost of maintaining a family of 4 was $4,217 in October of 1951. Last month, it had risen to $4,296, which indicates an hourly wage requirement of $2.14 an hour.

Chairman BARDEN. Would the gentleman permit, what caused that rise? Mr. DAVIDSON. The rise was approximately $82 in the course of a year.

Chairman BARDEN. What is your interpretation of the cause of that rise?

Mr. DAVIDSON. Well Mr. Chairman, in the brief time which is allotted to me and in view of the fact that I am not a great economist and do not pretend to be, I will suggest that this rise in cost has a connotation of reasons behind it. There is no one single cause of the rise in the cost of living in my judgment. Sometimes to find out why the cost of living rises we might have to go all over the world and study the economics and various factors which might induce such a result, and I frankly do not believe that I am prepared in a simple statement to give you the answer to that.

Chairman BARDEN. Well, I was just thinking, and nobody in the world wants people to increase their earning power any more than I do. My people, and my agricultural people are the hardest worked, with the longest hours, and the least pay that I know of.

Now, if vegetables and food products, and food and fiber products, are going to cost, to the point where it is, when farm labor now is around 75 cents, I am wondering what is going to happen to you folks when we catch up with you in wages.

Mr. DAVIDSON. Mr. Chairman, if I may just say this

Chairman BARDEN. I want to see it happen, and I want my folks to make just as much money as folks anywhere, that is in proportion to their cost of living. I know it takes less to live where I live, and I know that people have more food and so forth. But I want them to be better off than your folks, and you want your folks better off than mine, if you can have it. Of course we tell them that, and we kind of love our neighbors. But I am just wondering what would a man do with a crop of onions or potatoes under present conditions that he paid $1.25 an hour to raise. What would it cost with beef selling down in my area for 16 or 17 cents on the hoof and $1.25 across the counterI want to know what it would cost? Those things are very serious matters, and yet I want my folks making just as much-I think 75 cents is mighty low myself, but I want somebody to get me some figures on what that is going to do when it rolls around. If they will buy our potatoes, all right. But I do not want them left on our hands.

Mr. DAVIDSON. I think that is precisely the fact, Mr. Chairman. May I say this in that connection, that there are those who feel that $1.25 an hour might produce, or they say it might produce inflation, and thus further boost the cost of living. Those were the same arguments when Henry Ford startled the industrial world by saying he was going to pay $5 a day wages. That was unheard of in his day, in the automotive industry. And he was the master of assembly line mass production, and he was the man that brought the automobile down within the reach of the average individual. If it had not been for the genius of Henry Ford and his type of economics, an automobile might cost today about 5 or 6 times what it does cost.

Chairman BARDEN. You do not know of anybody building Fords but Ford, do you?

Mr. DAVIDSON. No; but I think the same things hold true. He was a trailblazer in the automotive industry. I do think this, Mr. Chairman, that the only justification that any minimum-wage law has is to meet a decent standard of living, that is the only justification that we have.

The figures that I was in the course of relating to the committee do not refer to my own home State alone, New York. Incidentally, in New York the figure which was given by the Bureau of Labor Statistics is $4,159 last April, which would mean an hourly wage of $2.07.

But strangely enough, in some of the southern cities, there are many, many instances where the cost of living is higher than it is in New York City. In Atlanta, Ga., for example, the Bureau of Labor Statistics puts the figure at $4,396 a year. Now, in order to earn that amount of money, a man working 2,000 hours a year, would have to earn $2.19. In Birmingham, Ala., he would have to earn $2.16. In Houston, Tex., he would have to earn $2.19. Now I believe the point is clear, and I have a list of all of these cities

Chairman BARDEN. Here is what I am getting at. Why not make it $2 then, instead of $1.25?

Mr. DAVIDSON. Very frankly, the day might come when we might find that this is not realistic. I just want to say this, that it is true that pensioners, and we all have great concern for them, and people who are retired, are better off in periods of deflation and unemployment. But I think that the wealth and the strength of any country lies in production and employment which means the ability of the man who works to buy products.

Now, if the cost is so much today in all of these 34 cities, and they are representative of this country, if the cost is so much to buy the products, the man who labors must at least be given some realistic opportunity to buy the product of his labor. If he does not have that opportunity, it may be that temporarily those who are on fixed incomes or pensions might for some temporary period be better off. But the health and strength of the country will not be so served. For that reason, I feel that we are duty bound to take cognizance of the fact that a very substantial increase in the minimum hourly wage is

necessary.

Chairman BARDEN. Do you realize how many more people there are in this country than there are in New York and Atlanta? Mr. DAVIDSON. Oh yes, indeed.

Chairman BARDEN. That is what causes mine, and Mr. Bailey's hair, and a few others to be turning gray. I have been wrestling with

this for a long time. I do not know whether it caused Mr. Bailey to give up his hair or not. It is not so simple as to say that we can pluck a figure out of the air, and say that it is this because our view is too restricted. We do not see much area. Go right ahead, and excuse the interruption.

Mr. DAVIDSON. I do not want to take any more time, I think you have been very generous with me.

Chairman BARDEN. We will meet tomorrow morning at 10 o'clock, and I must for about 10 minutes meet with a delegation that I promised some time ago. Will you just continue?

Mr. DAVIDSON. I will submit that table with the 34 cities for the record with your permission. I know that there are a great many people on this committee who are concerned with localities other than the one from which I come, and while I did not intend to put this in the record, but just for my own edification, I did check on what the cost of living was in the cities of a number of the members of this committee. I find that in my colleague, Congressman McConnell's community, in the city of Wynnewood, Pa., the cost of living as reported to me by the Library of Congress from figures culled by the Bureau of Labor Statistics, in April of 1955, and all of these figures are up to date, April of 1955, was $4,154. That would require an hourly minimum wage of $2.07.

(The table referred to appears at the close of witness' testimony.) Mr. Bosch, who comes from my city, in order to meet the cost of living there, he would have to see to it that those who labored in Queens County would get $2.07.

Mr. Holt, coming from Van Nuys, Calif., which is near Los Angeles, would have to see to it that his people get a little bit more, $2.19 an hour. That would be in order to meet the minimum standard cost of living which is $4,392 a year.

Mr. WAINWRIGHT. Judge Davidson, to interrupt you, are you referring to that figure as the total wage-earning capacity of the family of four, or are you assuming just the husband working, or the husband and wife?

Mr. DAVIDSON. I am assuming one person working, that is right. I am not suggesting that in order to live decently and properly, a man has to send his children and his wife to work. I am regarding the American family as a man who goes to work and supports his family, and sends his children to school, and lets his wife take care of the home.

Mr. FRELINGHUYSEN. Will the gentleman yield? I would like to understand the significance of these figures. Does this mean that representatives from those areas should back minimum wages at that level, or what is the value of figures such as this?

Mr. DAVIDSON. I think my answer would be "Yes" to your first question. I do think that members coming from these areas might give strong consideration to what would be the minimum that a cost of living would be and would certainly not shy away from this very modest bill, which calls only for $1.25.

Mr. FRELINGHUYSEN. Mr. Davidson, if I may ask, if I understand you correctly, you think that we would be automatically legislating in the national interest if we took the prevailing wage rate of our local community and used that as a reasonable level for a Federal minimum wage. Is that what your argument is?

Mr. DAVIDSON. No, I say that we can look at a cross-section of the United States, taking 34 representative cities, as I have done here, and I can name the cities to show you that they are representative cross sections, and from that at least get some encouragement for the proposition that $1.25 is certainly more realistic than anything less than that.

Mr. FRELINGHUYSEN. I am not sure what you mean by this word "realistic," and Mr. Bailey used the expression too. Suppose we are all agreed that we are looking for a realistic increase. What do you use to arrive at a realistic figure?

Mr. DAVIDSON. Some figure which approaches the cost of buying the necessities of life for a man and his family. That would be realistic.

Mr. FRELINGHUYSEN. But that might involve an increase of $1.50 in the Federal minimum wage, if that were the purpose of the Federal minimum wage. I am asking the witness if he I will be glad to yield after he answers me. Would it not?

Mr. DAVIDSON. I do not know whether at the present time it would necessitate our trying for the highest amount, but I certainly think that these figures are justification for what I think is a very reasonable and modest minimum wage, $1.25.

Mr. WAINWRIGHT. On this point that you are raising, you recommended $1.25, at the start of your testimony, and yet in answer to Mr. Frelinghuysen's question, you felt that a fair minimum wage was in the neighborhood of something over $2, or $2 and a fraction.

Mr. DAVIDSON. I did not say that. I said that I was indicating to you that the present cost of living, the present cost of living in these various communities was in excess of that. And may I say that, if there seems to be more disparity between that argument and the fact that I am pleading for $1.25, may I say that I am one of those whose economics may not be agreed upon in all quarters, but I am one of those who feel that it may not necessarily be required that the annual minimum wage reach the top limit that these figures seem to indicate. If it were substantially increased, the increase in purchasing power might so increase and strengthen business and the forces of production in this country as it did in the case of Henry Ford with his mass production and bringing down the cost of cars-it may so increase and stimulate business itself by giving these people a better opportunity to buy most of the things that they need, that you might instead of having inflation have greater production and healthier business and so bring prices down.

Mr. WAINWRIGHT. You might have the reverse. I am willing to admit your point, and you should be willing to admit equally the similar point that the cost of the raise of wages would also cause manufacturers to raise the cost of their goods. One is as conceivable as the other. I yield to Mr. Roosevelt.

Mr. ROOSEVELT. I would like first to compliment our colleague on having brought some factual information before the committee, but I would also like to, in relation to the question asked by the gentleman from New Jersey, make sure that the record shows, Judge Davidson, that you are not advocating that we immediately go to a $2 minimum or any particular minimum. It is my understanding, and if I am wrong I would like to be corrected, that what you are saying is that you think that $1.25 will get us nearer in our economy to a