B. The procedure worked fine as long as the wealth which they distributed continued to be produced.

C. They exploited the system by voting more money for nonproductive purposes and as a result discouraged the production of goods or wealth.

D. They become lazier, more and more dependent on handouts and less and less on production.

E. As a result, their morals declined.

F. They went broke.

In another way, it can be said that disaster can occur to our Nation's wealth-its ability to produce competitively-when the cost of its wealth, due to regulations or other reasons is too high.

We can increase this cost to such a degree that the system that made us great cannot stand it. We can increase this cost to such a degree that we cannot compete in world market. We can increase this cost to such a degree that the housewife cannot buy the sleepwear, so it is to this subject that we would like to address ourselves with you here so briefly.

On the subject of the two specifics I would like to touch on, the first has to do with reporting.

J. P. Stevens is the second largest company in our industry. They gave permission to submit these figures to you. It is quite unbelievable. Last year the reports filed with the Federal Government by this company, not including taxes, and tax returns, not including W-2's, were a total of 52,429 individual reports.

These reports total in pages 394,960 pages.

Stevens estimated that this number of pages was 130 feet high, which is the equivalent of a 13-story building.

We know by keeping one copy of each report that we send you from our small company, that we buy six file cabinets each year.

The other subject I would like to touch on briefly is that of flammability. The textile industry is concerned about any product that it produces. It has long been concerned about flammability, but when flammability first hit the Washington fan, there were not statistics available as to the number of burns that occurred in the United States.

HEW estimated that there were between 150 and 250,000 incidents of burn. There was no indication whatsoever of fabric-related burns. The Bureau of Epidemiology in the Bureau of Consumer Product Safety Commission began to accumulate statistics 4 years ago. They began to gather these statistics from medical centers, hospitals, and so forth.

It develops now-4 years later that the figure is more likely in the neighborhood of 20,000 to 25,000 incidents of burns. Now, that is a lot, but look at the difference with records to substantiate compared to bureaucratic guesses 4 years ago. Now, there is no indication either in these figures that if there are any fabric-related burns.

It is hoped that they can continue to develop these figures, and will come up with something that will really give use the magnitude of the problem, but let us assume that they are very small, and we have every reason to believe that they are, as far as fabric-related burns are concerned.

The regulations have been promulgated. Now, this fabric, a beautiful piece of Jefferson Mills corduroy, passes the test. You see, it did not burn up, but it still burned.

Now, in order to produce this result-poor as it is but still passing Government regulations-the cost is 50 cents per yard. The value of the product without the treatment is $1.50, so we are talking about 30 percent of the cost added to it.

It is estimated that 30 percent of the cost added here, applied to all apparel fabrics, will result in some $5 to $6 billion a year.

Yes, we believe that we are somewhat out of proportion here as to what we might make the economy of the United States pay in order to accomplish a purpose, as worthwhile as the purpose is. This industry will solve the problem, but there is a better way than by regulation, and that is by the marketplace.

Now, Mr. Newton will talk about the EPA and its impact on water pollution.

TESTIMONY OF FLOYD C. NEWTON, JR., DUNDEE MILLS, GRIFFIN, GA.

Mr. NEWTON. I, too, am glad to be here to have an opportunity to present some of the problems the textile industry has and some of the attitudes with regard to the general area of pollution abatement. Let me say in beginning that the textile industry generally is in agreement with the objectives and the programs to protect our environment. As evidence of this agreement, a concerted effort was started about 4 years ago, with an industry wide push to achieve the immediate goals of water pollution control within the industry by creating an environment preservation committee, whose first objective was to work with EPA in developing effective guidelines in controlling the discharge of pollutants.

This work was expanded to include cooperative work with the National Commission on Water Quality and a number of EPA contractors, and it has been broadened over the years to include air and solid waste disposal.

ATMI and the textile industry have taken a positive approach. through these efforts to solve the problem of pollution abatement, but with this approach has come the realization that many aspects of the laws and regulations in this field are unreasonable, they are unachievable from the practical standpoint, and they are unnecessary. In these comments, I will not attempt to address each of these things but focus on the immediate problems, and those of greatest concern to the industry on water. On water pollution, regulations controlling the discharge of pollutants and waste water were issued in February 1974. These establish the initial levels of abatement to be achieved in 1977, with a second level to be met by 1983, which is considerably more stringent.

The Clean Water Act sets as an ultimate national goal, the total elimination of all pollutants to be achieved by 1985. It is generally felt the majority of the textile industry will meet the requirements for 1977 and much of the technology required to do that is already in place.

There are serious questions, however, that the industry will be able to meet the 1983 levels, for two basic reasons. Because of the high capital expenditures and the high operating and maintenance costs involved, and because many of the technologies that are proposed by EPA have not been evaluated within the industry.

Current administration of Public Law 92-500, the Federal Water Pollution Control Act amendments, presents serious problems to the textile industry. They are marked by inequity, uncertainty, and the absence of reasonable cost considerations.

Under the major inequities: First: Implementing the 1977 requirements; the industry is curently faced with standards which are more restrictive than those which are placed on municipalities. In spite of the fact that municipalities can finance costs from public sources, it is commonly agreed that the majority of them will not even meet the 1977 requirements, much less the 1983 levels, and EPA appears willing to accept this double standard, and is even considering a delay in the compliance dates for municipalities but not for industrial pollution.

Pollution is a problem which addresses itself to total pollutant load in our water supply from all sources and it is inequitable for excessively heavy demands to be placed upon the industry segment, while municipalities continue pollution with lesser restrictions.

Second: A large majority of the discharge permits now in effect for the textile industry were issued before the water pollution guidelines were promulgated and they are more restrictive than EPA's 1977 guidelines. The textile industry feels that the discharge permits which have been issued should be adjusted to the 1977 guidelines, which EPA has issued, upon request from the individual holders of the permits, but no such requests have been granted to date.

The administration of the problem of water pollution is characterized by major uncertainties, one of which is the confusion and the inconsistency arising from overlapping jurisdictions between Federal and State agencies, even where EPA regional offices delegates permissable authority to a State, and it is our experience that an applicant must often negotiate with both State and Federal officials before a permit is finally issued.

Frequent disagreements arise between the agencies with the resulting confusion and delay.

Major uncertainty arises from standards and requirements which are created but which are not issued in time to permit proper planning in order to meet industry responsibilities.

In this area, the impact of the proposed pretreatment standards is one of the most serious unresolved issues. These standards will have a major effect on the textile industry, since approximately 76 percent of our plants, representing 35 percent of our total waste volume discharge into municipally owned facilities. Many mills will be especially hard hit since they do not have access to land for building their own treatment plants, and, therefore, no practical alternatives to utilizing local sewage systems.

The original pretreatment guidelines proposed by EPA would require discharges into municipal systems to perform essentially the same treatment as that required for treatment discharges which is clearly a case of duplication of treatment.

To this date, EPA has not issued the standards for pretreatment and the industry does not know what to expect, nevertheless, we are expected to make long-term commitments for pollution abatement which must take into consideration the pretreatment aspects of water pollution control.

It is rather difficult to plan or make commitments of this kind without knowledge of what the game rules are. It is our view that the cost of pollution abatement have been consistently underestimated and may well represent unreasonable amounts in relation to the benefits to be obtained.

Estimates of cost to meet the 1977 and 1983 levels of water pollution control range from $530 milion $2.9 billion for the textile industry. Regardless of which of these very widely varying estimates is accurate, either presents a serious problem of capital investment for the textile industry.

According to the Department of Commerce, total profits after taxes for the entire industry average $648 million per year, for the 5 years through 1974. During the same period, expenditures for new plants and equipment to maintain productive capacity averaged approximately $702 million per year. Obviously, the level of profit abilty in the industry cannot support the tremendous capital requirements for nonproductive water pollution abatement equipment and most of these costs will have to be passed on to the consumer, if we are going to stay in business.

The National Commission on Water Quality has estimated a 4.7 increase in textile prices resulting from water pollution control costs. To this must be added the cost of regulatory programs for noise, cotton dust, toxic substances, flamability and others.

It is our broad general estimate that a total increase of more than 20 percent in textile costs to the consumer will result. The 1977 levels for water pollution control require a pollutant remover of 90 percent for the textile industry. In special situations, where this is not considered adequate, we are meeting more stringent and costly standards. It is generally believed that the reductions of that magnitude, along with the 85 percent removal of pollutants required for municipalities will enable the vast majority of our streams and rivers to adequately support fish, wild life and recreational activities.

To meet the 1983 requirements will entail an extremely high cost for a very modest amount of improvement and it may well be that those requirements are not necessary and can be attainable at an economic cost which would clearly outweigh any benefits to be obtained. I might comment that in the case of the textile industry, the cost impact of these programs is extremely burdensome, especially when we are facing a serious problem of imports from foreign competitors, who are not required to meet any such standards in their production. These observations lead us to two major suggestions. One, we feel that the consumer should be made aware of the high cost of the abatement programs being considered, so that the public can form its own judgment as to value and cost justifications of the benefits to be derived. To our knowledge, little or no information of this type has been released.

Second, we recommend strongly that there be a general review of the goals of the water pollution conrtol program when the 1977 re

quirements have been met, so that an adequate evaluation of the need for more stringent controls, the technology available to achieve better controls, and the cost estimates involved can be put into better balance.

On the matter of air pollution, this is somewhat different, because the regulatory program for air pollution have been primarily the responsibility of the States. Nevertheless, we have problems in this area also. For instance, the majority of our plants had already switched from coal to natural gas and fuel oils to reduce boiler stack emissions prior to the time the present legislation was even enacted. Senator NUNN. Mr. Newton, I do not want to shut you off but we are going to have to speed up a little bit. If you could, kind of summarize the rest of your testimony, because we are getting pretty far behind.

Mr. NEWTON. All right. Well, we find ourselves in a precarious condition because of this conversion, due to a shortage of natural gas. The big problem that we have is that when coal is burned, the use of electrostatic precipitants or wet scrubbers to clean up boiler stack emissions results in a sludge that cannot be discharged into the waste water stream and the cost of energy to burn them is prohibitive. One of the serious things is now developing and which I want particularly to mention additional legislation which is now being considered by the Congress. It is an amendment to the Clean Air Act,

requiring that the States adopt plans preventing any significant de

teriorations or degradations of the air over existing national parks, national wilderness areas, national memorial parks, et cetera.

Now, the provisions of this amendment have the effect of establishing a program of Federal zoning, Federal land use planning and control and Federal control of industrial plant locations that will seriously interfere with the ability of States to encourage the new growth of the industry.

In the area of solid waste disposal, the problem we have is one of indefiniteness. The contractor for EPA, in studying this matter to assist EPA in developing additional regulations, came up with the conclusion that textile sludges are potentially hazardous, since they may contain heavy metals and some toxic materials which may leach or migrate to underground water supplies when disposed in a landfill. There was no evidence in the study whatsoever to support this conclusion but because of the large amount of sludges that are generated in the textile industry, this is a very serious problem.

Now, the question comes up of how EPA would have the industry dispose of these things? They cannot be incinerated because of air regulations and they cannot be dumped in landfills because they may generate problems as far as our underground water system is concerned. No solution, no suggestion is given for the solution of a prob- ́ lem of this kind.

Let me just mention to emphasize my starting point, the proposal that has been made by the textile industry to EPA, ATMI has offered to conduct a joint program with the Federal Government which is intended to evaluate the technical and economic achievability for meeting the 1983 water standards. This will be a $630,000 study to be jointly funded by EPA and the textile industry, requiring approximately 30 months.

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