Mr. WEIR. You were lucky. We have some farmers out west who used to have to pay in excess of what they got for shipping their cattle to the stockyards.

Chairman BARDEN. Right now they are selling beef cattle down my way for 16 cents. The trouble is the great bulk of those people never get any benefit of this kind of thing. It all takes place beyond the gates of where the work is done.

Now we can lopside this economy all we please, and we can say, well, we are going to push it up here, and we are going to push that other end down. I would like to be on the high end of the seesaw board some time, and I would like to see my people get on there.

Mr. WIER. Let's pick up the sag then. That is all this legislation is doing, is picking up that sag in our national economy.

Chairman BARDEN. That is where we are getting to. Now we are getting back where we started.

If we will pick up the sag and if we will pick up the inflation we can get out of this dizzy whirl. They say a dollar now is down to about 45 cents. I doubt if it is that high as far as that is concerned. But don't ever get it in your head that you can't press that dollar down to 5 cents.

Mr. WIER. Who does that? Did you ever see increased wages precede increased cost of materials?

Chairman BARDEN. I certainly have.

Mr. WIER. Now we come to what comes first, the chicken or the egg.

Chairman BARDEN. I certainly have seen increased wages precede the increase of costs.

Mr. WIER. Not in the final analysis.

Chairman BARDEN. What justification was there for going up? Mr. WIER. It is capital in this Nation that sets the pace.

Chairman BARDEN. I am not going to fight capitalism.

Mr. WIER. You don't have to fight capitalism.

Chairman BARDEN. I am not mad with industry. I am not mad with collective capital.

Mr. WIER. Then we ought to get along very nicely on $1.25.
Chairman BARDEN. If you justify it. But you can't.

Thank you very much, Mr. Hale. We are pleased to have had you before the committee.

Mr. HALE. Thank you, Mr. Chairman.

Mr. HUSSEY. Mr. Chairman, Congressman Sidney Fine has sent the committee a statement that he wishes made a part of the record, and I herewith submit it.

Chairman BARDEN. Without objection, it is so ordered. (The statement referred to is as follows:)

STATEMENT OF HON. SIDNEY A. FINE, A REPRESENTATIVE IN CONGRESS FROM THE

STATE OF NEW YORK

Mr. Chairman and gentlemen of the committee, relative to the bills introduced providing for a minimum wage of $1.25, I beg to say that decent living standards cannot be maintained on less than $1.25.

Consumer prices continue to rise. The low-wage earner has been staggering under an overwhelming burden of high taxes and ever-rising living costs and no relief by way of increased earnings has been given him.

We must come to the rescue of laboring people of the country. The wage earner should be adequately paid for his labors and efforts; this is only his just share of the profits reaped as a result of his labors.

The New York Democratic delegation, in emphasizing the need for $1.25 minimum wage, stated:

"We, the members of the New York State Democratic delegation, go on record as supporting the $1.25 minimum wage. A minimum wage of 75 cents was established in 1949. It was inadequate then, and it is shockingly inadequate now. Even a cursory look at the facts proves this glaring fact.

"There has been an overall increase in living costs of 14 percent since January 1950, but for the lowest income group which suffers the greatest price rise, living costs have increased by at least 18 percent. Thus 75 cents an hour is now worth only 65 cents, leaving a minimum wage of $26 per week.

"While the 75-cents level has remained, our productivity has increased at least 20 percent and the gap between what a man is paid and a man produces widens, and the glaring injustice of the 75-cent wage emerges from the gap. "Since January 1950 there have been 5 general wage increases in our major industries, ranging from some 39 to 53 cents per hours, of increase alone. This, of course, does not include fringe benefits, pensions, life insurance, sickness, and disability benefits which have been added to the payroll.

"There is a completely unrealistic relationship between the 75 cents an hour established by law and the existing wage structure of American industry. It has been proven that even a working woman who lives with her family must have an hourly minimum wage of $1.22 according to the New York State Department of Labor, if the health, morale, and general economic welfare of the country are to be protected. Can the richest Nation in the world stand by and say it cannot afford a Federal hourly minimum of $1.25? Yet these are the facts. In 1953 we produced a record of $365 billion worth of goods and services, yet 23 percent of all the families had total money incomes of less than $2,000.

"The reasons for poverty are many-disability, old age-low rural incomes, etc. The fight against poverty must have many weapons, some of them subtle, some of them more direct; the most direct, the least complicated, the simplest to effectuate, would be to increase the Federal minimum wage to $1.25. An adequate minimum wage would not only affect the workers themselves but would raise the economic standard of the country generally. It means increased purchasing power, increased demands, from which inevitably all industry and all labor must benefit."

For the foregoing reasons, I urge this committee to report favorably an increase in the minimum wage.

Chairman BARDEN. Gentlemen, I believe that concludes our list of witnesses, and we will meet Tuesday morning at 10 o'clock. And, as I understand it, the Labor Department will be here.

(Whereupon, at 12:15 p. m., the committee was recessed, to be reconvened at 10 a. m., Tuesday, June 7, 1955.)

AMENDMENT TO INCREASE THE MINIMUM WAGE

TUESDAY, JUNE 7, 1955

HOUSE OF REPRESENTATIVES,

COMMITTEE ON EDUCATION AND LABOR,

Washington, D. C.

The committee met at 9:20 a. m., pursuant to recess, in room 429, House Office Building, Hon. Graham A. Barden (chairman) presiding.

Present: Representatives Barden, Bailey, Perkins, Wier, Landrum, Bowler, Green, Roosevelt, Zelenko, McDowell, Thompson, McConnell, Gwinn, Smith, Kearns, Hoffman, Bosch, Holt, Wainwright, Frelinghuysen, Coon, and Fjare.

Present also: Fred G. Hussey, chief clerk; John O. Graham, minority clerk; Edward A. McCabe, general counsel; Russell C. Derrickson, chief investigator.

Chairman BARDEN. The committee will come to order.

I believe we have with us this morning Under Secretary of Labor Larson. Mr. Larson, I believe we are ready to hear you, and we will be glad to have you proceed.

STATEMENT OF HON. ARTHUR LARSON, UNDER SECRETARY OF LABOR, DEPARTMENT OF LABOR

Mr. LARSON. Mr. Chairman and members of the committee, I am very grateful for this chance to present the views of the Department of Labor on the revision of the Fair Labor Standards Act. I am going to state in a general way the proposals of the administration, and the supporting facts. Then I will be followed by Mr. Stuart Rothman, who is both Solicitor of Labor and Acting Wage-Hour Administrator, who will go into more detail.

In arriving at fair labor standards proposals which will achieve the greatest amount of well-being for the working people, there are three things that have to be kept in balance: First there is the minimum-wage figure itself; second is the possible effect on substantially curtailing employment or earning power; and third, the extent of coverage.

Now, these three things are not something that we have made up, or invented. These are laid down in the finding and declaration of policy in section 2 of the Fair Labor Standards Act itself, and it seems to us if we in the executive branch are going to help in carrying out the intent of Congress we must constantly keep each of these three factors in mind. We should not become preoccupied with one at the expense of the other.

As to No. 1, the minimum-wage figure, the intent of Congress is very clear in this declaration, when it speaks of correcting conditions detrimental to the health, efficiency, and general well-being of workers. As to No. 2, it is just as clear. The declaration states that this must be done "without substantially curtailing employment or earning power."

As to the third factor, we are admonished "to correct and as rapidly as practicable to eliminate the conditions above referred to in such industries."

In other words, this is a definite expression of policy of expanding coverage as rapidly as practicable to industries having substandard

wages.

The administration in framing its proposals has sought to bring all three of these elements into balance, with the one pervading purpose of finding the combination that will result in the maximum benefit to the workers of this country.

There has been a lot of discussion of these and many other proposals, and in these discussions sometimes it seems to me there has been a tendency to single out 1 of these 3 elements for criticism or comparison as if it were somehow being put forward in a complete

vacuum.

For example, the commonest tendency has been to concentrate on stating as high a minimum-wage figure as possible while playing down or ignoring these other two elements, the possible curtailment of employment or the effects on the prospects of expanded coverage.

I am sure that all of us who have addressed ourselves to this question are aiming at the same objective, which is to obtain the greatest possible improvement in the economic status of low-income people as rapidly as possible. The disagreement seems to revolve around the question of which combination of these three factors will produce that maximum improvement.

Some people think that the greatest improvement will come with a very large increase in the minimum-wage figure itself, and they are not particularly concerned about the other two elements. Some others are urging very large increases both in the vertical minimum wage and in the extent of coverage. But they leave out of account almost completely this second element, which is the impact of such a sharp and sudden change on the low-wage, low-profit-margin businesses in small towns and rural communities throughout the country. The administration believes that its proposals contain the most all-around beneficial combination, from the workers' point of view, of these three variable factors. It is this package which the administration is recommending, consisting of a substantial increase in the minimum wage, to a figure which will bring the benefits intended by the act as far as possible without undue offsetting harmful effects on employment and purchasing power, and a substantial increase in the number of people who are to receive the protection of the act.

Since this set of administration proposals is a package which has been arrived at by the balancing of various factors bearing on the well-being of workers, I would like to state very plainly today that my function is to present and support this affirmative program as a whole. I have not come here today to be against things, but I have come here to be for what we think is the best thing for the good of all of the working people. That is this combination, and this package.