Mr. BELL. Yes. In answer to your question, there is no penalty for violations except insofar as indirect coercion-the threat to take away orders, or contracts, or priorities, or material, which is wrong fundamentally and against our democratic system.

Mr. DURHAM. Do you not think and believe when we have reached a point where a company here makes a statement that it employes 30,000 persons at the end of 1942 and they have to hire 15,000 people during the year to increase their force by 3,000 that there ought to be something done somewhere?

Mr. BELL. I am glad that you spoke about that. It is in the industrial relations memo of March 15. I think it is terrible when we reach that situation.

The CHAIRMAN. Well, Mr. Bell, we thank you very much for your remarks.

We will now hear from Mr. Alton Roth, a member of the War Labor Board.

Mr. Roth, you may proceed with any statement that you may have to make, and you may sit down or stand up, just as you like.

STATEMENT OF ALTON E. ROTH, WAR LABOR BOARD, SAN FRANCISCO, CALIF.

Mr. ROTH. Thank you very much. May I qualify myself on this?

The CHAIRMAN. Yes.

Mr. ROTH. My name is Alton E. Roth. My address is 114 Sampson Street, San Francisco, Calif. I am at present an employer member of the War Labor Board, but I am not speaking in my official capacity. Rather, I am speaking from my experience in the field of labor relations to which I have devoted my whole time during the past 6 years, first as the president of the Water Fund Employers' Association of the Pacific coast, which represented all the shipping interests of the Pacific coast, both foreign and domestic, or practically so, 93 percent of the tonnage, in its dealings with the longshoremen labor unions, and as president for 3 years of the American Shipowners' Association, which represented the American-owned lines in their dealings with the offshore unions.

More lately, and for the past 3 years, I have been president of the San Francisco council, which is composed of practically all the employers of San Francisco. We have an employers' union, and we represent these employers in their dealings with unions, both in negotiations and serving of contracts, so whatever observations I have to make are based upon my personal experience in the field of labor relations and in dealings with some 225 different unions, and also in close contact with the manpower officials.

If I may, I would like to presume to speak of the public reaction toward this bill as I have gathered it in participation in public forums, nation-wide broadcasts, and a number of addresses before all types and classes of citizens, long and many contacts with labor board leaders both here on the War Labor Board and in negotiations with the unions on the Pacific coast, and I will say to you gentlemen that I am convinced from my personal contacts with the man on the street that the question he is asking himself is, "Why are we waiting to put in some orderly system of selective service for civilians?" You do not have to argue with the man on the street any more as to the existence,

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and I am sure you do not have to with this committee, after some of the things that I have read in your proceedings, of the existence of an acute over-all national manpower shortage. The man on the street who cannot get his laundry done any more; who cannot get service in a restaurant because of the shortage of labor; and has seen civilian enterprise curtailed; who has found his food short; has seen crops, particularly on the Pacific coast, lost because of the fact that we have not the labor; who has seen his cream rationed because we have killed our dairy herds; who heard Mr. Land testify to the fact that we need 50,000 more men in the shipyards-our most critical industry-is convinced that we have reached the point where something must be done on this subject.

I am almost convinced from my contacts with John Q. Public that he has not been misled by some of the smoke screens that have been set up to obscure the real purpose of this bill and its effectiveness.

In the first place, I have found that the average man in the country is not at all impressed with the argument that we would inaugurate involuntary servitude under the provisions of this bill. Nearly every family in this country has some member of it engaged now in active war service, and as I talk to people I find a firm conviction that there is no finely drawn line of demarcation that you can make between the man out there serving his country in active service and the man supplying the guns, the ships, or the other things with which we must be supplied to make this fight; and personnaly I think that there is no validity to that argument. It is pointed out by someone who appeared before you in one of your records, and referring to a decision by Chief Justice White on the question of selective service, there was the point made by implication that you cannot distinguish between producing the necessary implements of war and the necessary supplies of war and devoting our citizenry to that purpose and going out there and actually fighting.

Certainly, I have not subscribed to the smoke screen about what this will do to productivity. I think that anybody who says that the American workman will sulk and let down on his production because he is told by his Government to do a particular job as a part of our national war effort is, as a matter of fact, making a libelous statement against our American worker. I do not think that our American worker is going to do that. My experience on the War Labor Board has convinced me that the laborers will fight for their cause up until the time the decision is made against them. Once their Governor or Commander in Chief, the President of the United States, through a directive, decides that the national policy is a certain thing, those men will take those national policies patriotically and as patriotic citizens and will go down the line, and if we draw upon our experience in the War Labor Board-I will refer to the Air Frame case, probably no more unpopular decision was made by the Board, a denial of the general wage increase to thousands of aircraft workers who had been led to believe by their leaders, and by the program carried on by the War Labor Board itself, by holding these hearings in working out the classification program, that they would get a wage increase; yet I know from personal observation and conversations with the top men of the 10 aircraft plants involved in that order that the production never went down one iota after the unfavorable decision.

They went right on with their job. So I say the effect of this bill will not be, as so many people have said, to retard production, because

people will feel that they are compelled to do something. It seems to me that the first approach to this manpower problem-and it is a hobby with me-I speak on it every time I get a chance-is to make use of the people we now have on the job, and it is almost incredible that in this country, at a time when we are short of ships to take the munitions and the supplies which we have, when we are short of men in many critical responsibilities, there are still arbitrary restrictions upon the output of the individual worker now on the job.

Now, the first thing we ought to do is to properly utilize our available supply of men, and by that I mean right on a particular job right now. That simply makes good sense, because by doing that we take the greatest advantage of our supervisory skills, we take the greatest advantage of the fact that we have housing. We eliminate the necessity of transportation of these men, and we do the common-sense thing of conserving and utilizing our manpower.

Now, at the present time we are trying to do this thing in a rather haphazard way, it seems to me, by two processes.

The question was raised here a moment ago about the effectiveness of voluntary processes. I have said and advised employers generally I think they should participate in all the voluntary arrangements being suggested, of agreeing among themselves that they will not issue a certificate of discharge to a man if he is going to leave that plant and go off to another. I think that we will have to participate in those things for two reasons: First of all, frankly, I do not think until we can tell you gentlemen up here in Congress this bill ought to be passed until it has been demonstrated that you have got to do this thing by a voluntary process and wipe it off the slate. I think we ought to make that try.

Secondly, we can make some progress through voluntary methods, and whatever we gain by that in curtailing turn-over, and otherwise in the utilization of our manpower, will be worth while. I still think we have got to do that, but I do not think that is the answer, and I think the testimony before this committee is to the effect so far that those voluntary arrangements have not been as effective as they might be.

Now, the second thing that we are doing, and this is an interesting thing I do not know whether it has been brought to the attention of you gentlemen or not-but when we first had this Executive order of the President handed down to us at the War Labor Board, a question arose as to how we are going to administer this terrific job of determining whether individuals in the United States, or any particular individual, could have a wage increase. One of my labor colleagues on the Board wanted to bet me a dinner-I wish that I had taken him up that we wouldn't have much of a case because of the traditional employer resistance to wage demands. He was absolutely wrong.

Our whole employment relationship has been turned topsy-turvy by two factors; first of all, the fact that the costs of increased labor services have been passed on to the Government by one division or the other so that employers do not care what it costs; secondly, by the necessity for getting their men, so we have been trying indirectly, not ostensibly-but it has been working-to influence the flow of manpower by wage increases. Now, we did not do it publicly, but we have down there over 27,000 applications for voluntary increases which have been filed with the War Labor Board or its regional

agencies, and of those 27,000, 72 percent are by employers and another additional 27 percent are filed jointly by unions and employers, which means that in 99 percent of the cases the employers are asking for wage increases.

Now, they are doing that for the reasons that I stated, because the cost is being passed on in many cases and because of the element of self-preservation. The only way that they can hold their men and keep them going is to make wage increases. The only sensible reason that they ask for these increases is not a shortage of manpower-nobody is foolish enough to do that, because the War Labor Board has been firm in saying that we would not give wage increases for that purpose-they have done it in one case that I am going to refer to, but they have said that we want this to correct inequalities; and under the policy which the Board was using until the last directive came down it was a fact that if you applied the policy of the Board there was ground in many of these cases for granting wage increases. The CHAIRMAN. How many?

Mr. ROTH. In a great number of them. But the impelling motive behind that thing was not newborn generosity on the part of the employer to give his men more wages; the impelling motive was to hold his manpower. So we have this situation where we are whipsawing wages over here and equalizing over there. As a result we do not create any manpower at all.

The CHAIRMAN. I do not want to interrupt you, but I want to ask you a question right at that point. That is this: Is it not a fact that wage increases have been prompted, or applications for wage increases have been prompted very largely by the fact that nearly all of the work that is being done in the country is on war contracts?

Mr. ROTH. I have made that point.

The CHAIRMAN. Where the Government is paying the bill, and the contractor does not care how much it is.

Mr. ROTH. That is true. I have already made the point, that since the employer is not paying the bill, he is not worrying about the cost; secondly, he is doing it out of a desire to save his enterprise. Here is what he does. You have this paradoxical situation. Thousands of employers are opposed to inflation, and they file individual applications asking the Board to increase the wages of their particular workers, and the composite result of that thing obviously will be inflation. They pay no attention to the cumulative effect of their individual petitions. It seems to me that that is not the answer to this thing. We experimented with that in the copper case. I sat as a member of the panel which decided that case, and I dissented, and I still adhere to my dissent. In that case we gave $1 increase to the miners in the Pacific Northwest States for the purpose obviously and admittedly of influencing the flow of manpower. We said we were going to hold these boys in the mines, and we were going to draw them back, but General McSherry testified at that time, and this is typical of many manpower situations in this country, there was an over-all labor shortage of 100,000 men in that Pacific Northwest area, and that not only the mines were short but the lumber industry was short and the shipyards were short and the aircraft industry was short. So was alumi

num.

Now, I argued, and I still maintain, that you do not cure a manpower problem by simply drawing men away from shipyards, back into the farms, or copper mining, or whatever it may be, and creating

a shortage at the place from which you take them. That is what we have been doing by and large in this country.

Mr. Murray testified the other day that we can expect some unemployment due to the fact that there is a shortage of materials at this plant, or a change of design, but the fact that you did have unemployment at a particular point seems to me is the best possible argument for this bill which would enable the Government to sit down and do an over-all job of allocating this labor and moving it where it is needed. Now, the $1 increase we gave in copper did not accomplish that purpose, so we still have a shortage. It is now suggested that we equalize lumber and copper mines with shipbuilding and aircraft, and we already know, and I heard this testimony the other day from representatives of the Manpower Commission, that as a result of this movement back to the farm, largely by this deferment, which has been promised, we have drawn as much as 25 percent of the labor supply away from our industries.

Now, the sad part of that kind of a piecemeal expedient treatment of this labor problem is this, that that very process wastes manpower, and wastes tremendous amounts of it. When men are moving from the farms to industry, or from the mills, as they have, and woods, particularly, down to the shipyards, they are not working. The time it takes to move their families, the dislocation itself, has to be taken into consideration, and in addition to that we lose the training.

The records will show in our aircraft plants on the Pacific coast that men left them to go over to a shipyard, to train over there for special duty in the shipyard, and then they turned around and came back to the aircraft factory. Now, that sort of things wastes tremendously. Mr. DURHAM. May I ask you a question right there? Of course, in that you have the element of a wage differential back and forth in those war industries that you mentioned, but you cannot attribute this "back to the farm" movement to the wage scale.

Mr. ROTH. That is right. That is due to the deferment of men, the promised deferment. I think that is what it is due to, and partly to an appeal to patriotism.

The CHAIRMAN. I think that we have to go to the floor of the House now for a roll-call vote. We will adjourn this meeting for 30 minutes. (A short recess was taken.)

The CHAIRMAN. The committee will please be in order.

Mr. ROTH. I think at the time of adjournment I had just stated the two methods that we had employed to date in an effort to solve our manpower problem had been ineffective-voluntary agreements to control the flow of manpower, which I stated I felt we would have to go through with to remove the alibi that that was the solution, and until it was demonstrated it was not effective possibly we could not get the action which is suggested in this bill; secondly, that in the process of doing that we would make some gain because unquestionably these voluntary arrangements which have been directed at the prevention of excessive turn-over, voluntary arrangements between unions and employers, have reduced the rate of turn-over.

Our rate of turn-over in our shipyards and aircraft plants has run as high as 12 percent, and where they have worked out cooperative arrangements, as they have in some localities, they have been able to cut that in half. But you still have a tremendous wastage after that voluntary effort which this country has to in some way eliminate if it is going to make use of its available manpower.