predicament we are in. But I would like to raise one point. You would not go so far as to say that seizure is the only alternative by which to avoid a stoppage of steel production?

Secretary LOVETT. Senator Ives, I think I covered that point before you came in.

Senator IVES. I did not hear all of it.

Secretary LOVETT. I said we had no knowledge of the various alternative courses of action, that the mechanics, the procedures to keep this thing going were not in our province at all. The question which Senator Morse asked was, I think, a hypothetical one. Could any President avoid the responsibility of keeping the steel production up? My answer to that was that I thought in the present critical times steel had to be produced, but that I did not know what the alternatives were or whether there was some other way. I think myself there are several alternatives, but that does not lie in the area in which the Defense Department is concerned.

Senator IVES. I misunderstood your position from your answer before. That is why I wanted to clear it up. What little I have heard of it, I thought you were assuming that seizure was the only alternative. I apologize for not hearing the question.

Senator MORSE. I am sure my good friend from New York would be glad to hear me say it was not the position the Secretary took. I also want to assure him that the junior Senator from Oregon thinks that some other procedures should have been followed than the one that was followed.

Senator IVES. You have already offered some comment, have you not?

Senator MORSE. My question to the Secretary was simply to the point that having reached the eleventh hour, was there any obligation in his opinion on any President, no matter who he might be, in the White House, to do whatever was necessary to keep the steel mills going.

Senator IVES. Mr. Secretary, in order to clear that again, that does not necessarily mean that any President who might be in the White House might choose the correct way to do that. Senator MORSE. He might make a mistake. tant that he keep them going, and that he did.

But it is still impor

Senator HUMPHREY. Lest there be any doubt, Mr. Secretary, whatever the alternative, as I understand it, it required continuity in production.

Secretary LOVETT. Yes.

Senator HUMPHREY. If there had been any cessation of production over a prolonged period of time, let us say 2 or 3 weeks, would it have been necessary for the Defense Department then to have requisitioned even more sternly and more drastically the available steel, and thereby deny other areas of the economy?

Secretary LOVETT. I think that would have been inevitable.

Senator HUMPHREY. Would it, for example, have been necessary for the Defense Department to have required steel which now goes into such civilian items as, let us say, farm machinery? Would there have been a priority for atomic energy development, munitions, and artillery over that?

Secretary LOVETT. I think the Office of Defense Mobilization, in considering the requirements, would have had to give a clear and

overriding priority to the basic military requirements, and those of the atomic energy, power and similar items associated directly with

Senator HUMPHREY. As the pool becomes restricted, in other words, the essentiality of high priority for end item military equipment would have been increased and augmented?

Secretary LOVETT. That is correct, sir.

Senator HUMPHREY. Are there any other questions? If not, Mr. Secretary, as the temporary acting chairman, I want to express the gratitude and appreciation of the committee for your attendance. May I say on behalf of Senator Murray, the chairman, that your cooperation has been much appreciated.

We will stand in recess at the call of the Chair for the continuation of these hearings.

Secretary LOVETT. Thank you very much, sir.

(At 3:20 p. m., the hearings recessed subject to call.)

NATIONAL AND EMERGENCY LABOR DISPUTES

WEDNESDAY, APRIL 30, 1952

UNITED STATES SENATE,

COMMITTEE ON LABOR AND PUBLIC WELFARE,
Washington, D. C.

The committee met, pursuant to call, at 2:30 p. m., in the old Supreme Court room, the Capitol, Senator James Murray (the chairman) presiding.

Present: Senators Murray, Humphrey, Lehman, Pastore, and Morse. Present also: William H. Coburn, clerk; Ray Rodgers, assistant clerk; Jack Barbash, staff director and Merton Bernstein, counsel, Subcommittee on Labor-Management Relations.

The CHAIRMAN. The hearing will come to order, please.

I regret to call you back here, Mr. Feinsinger, inasmuch as you are under such great pressure these days. We would like to avoid putting you to the additional burden of coming here again in regard to the steel dispute and the seizure situation. We will be glad to hear from you.

STATEMENT OF NATHAN P. FEINSINGER, CHAIRMAN, WAGE STABILIZATION BOARD-Resumed

Mr. FEINSINGER. Thank you, Mr. Chairman. With respect to your kind remarks, let me assure you I did not take this job for my health. On testifying here, to throw whatever light on the very serious problems with which this committee and others are being called upon to grapple, I had expected to have this morning free to complete a prepared statement, but unfortunately I was not able to do that because the House Banking and Currency Committee asked me to return this morning to help them a little bit. So with your permission I would like to submit a prepared statement later on as soon as it is completed. The CHAIRMAN. That will be satisfactory and it will be printed in the record.

(The statement referred to is as follows:)

STATEMENT OF NATHAN P. FEINSINGER, CHAIRMAN, WAGE STABILIZATION BOard, PREPARED FOR PRESENTATION TO SENATE COMMITTEE ON LABOR AND PUBLIC WELFARE, WEDNESDAY, APRIL 30, 1952, AT 2 P. M.

On Tuesday, April 15, I appeared at the invitation of this committee to discuss the steel dispute in relation to S. 2999 and S. 3016. I have been asked to present further testimony today, including comment on prepared statements and testimony submitted to your committee on April 22, 1952, by Mr. John A. Stephens, vice president of industrial relations, United States Steel Co., and on April 22 and April 23, 1952, by Mr. John C. Bane, Jr., an attorney for various steel companies, who performed a valuable service as an industry member of the special tripartite panel appointed by the Wage Stabilization Board in the steel dispute.

Mr. Stephens dealt mainly with statistical aspects of the Board's recommendations in the steel case. Mr. Bane, besides repeated personal attacks on the public members, which I do not intend to answer, testified mainly with respect to the Board's procedures.

ORGANIZATION AND PROCEDURES OF THE WAGE STABILIZATION BOARD

I believe that I can be most helpful to the committee at the outset by describing the organization of the Wage Stabilization Board, its purposes and its procedures, and then follow with a review of the steel case in relation thereto. Any comments I might have concerning the statements and testimony of Mr. Stephens and Mr. Bane I shall make as part of that review. I shall conclude with a few remarks about S. 2999 and S. 3016.

TRIPARTITE CHARACTER OF BOARD

The Wage Stabilization Board is tripartite in character, as was the War Labor Board in World War II. The Board consists of 18 regular members and 6 alternate members, representative in equal numbers of the public, management, and labor. Each member of the Board is appointed by the President after full investigation of his background, experience, and qualifications in the field of labormanagement relations. Appendix (I) contains a biography of each member of the present Board.

A tripartite Board is best suited to deal with the problems of wage stabilization and labor disputes in a defense emergency. Wage stabilization is not conducted in a vacuum. As Congress wisely foresaw, its administration has a direct effect upon the purchasing power of the dollar, upon collective bargaining, upon the maintenance of industrial peace, and upon the attainment of maximum production. The balancing of these various factors requires an understanding of the day-to-day problems of labor and management and a realistic appraisal of the impact of the Board's actions on their basic relations. Such an understanding or appraisal is not possible except through direct participation by representatives of labor and management in the formulation and administration of the Board's wage policies. Moreover, such participation, with equal voting rights, insures the maximum degree of acceptance of governmental intervention by labor, management, and the general public, in an area normally left to free collective bargaining. It is noteworthy that of the 21 regulations adopted by the Board, which together constitute the Board's complete, basic stabilization policies, action was unanimous in all but five.

There is grave risk in proposals now being considered which would destroy in whole or in part the tripartite nature of the Wage Stabilization Board by the substitution of an "all public" board, or a board in which the representatives of labor and management would be reduced to an inferior status in terms of voting rights. The public interest requires that no such radical change be made, certainly not hastily or without full consideration of the consequences.

The Board's jurisdiction in voluntary cases stems from title IV, Wage Stabilization-Objectives and Procedures of the Defense Production Act of 1950, as amended. In stabilizing wages, due regard is to be had to the preservation of the purchasing power of the dollar, the maintenance of sound working relations, including collective bargaining; the prevention and settlement of labor disputes; and the achievement of maximum production for defense. Regulations or orders are to be "fair and equitable" and such as to effectuate the purposes of title IV. In administering wage controls, such adjustments are to be made as are deemed "necessary to prevent hardships or inequities." The Board acts through the adoption of general policies issued in the form of regulations and resolutions, and through rulings or orders issued in particular cases, including cases where wage adjustments, whether or not assigned to particular regulations or policies, are shown to be necessary to avoid hardships or inequities. Congress did not intend that wage stabilization be conducted by arbitrary or slide-rule methods, nor does the Board purport to operate in that way. For example, in the General Electric case, the Board on March 16, 1952, unanimously approved a joint employer-union petition for an adjustment of 2.5 percent, equivalent to about 4 cents an hour, because the employer in that case had traditionally followed certain electrical firms in making its wage adjustments from time to time. This action was not attributed to any specific regulation but was taken in order to avoid undue hardship in the particular case.

HOW THE BOARD OPERATES

It might be helpful to this committee if I were to give you a birdseye view of how a tripartite board operates. The Board itself sits in Washington, D. C. It has 14 regional boards having a similar tripartite structure. The Board in Washington handles some cases directly and others on appeal from the regional boards. The National Board is assisted by a Tripartite Review and Appeals Committee, consisting of people with a practical background in wage stabilization and labor-management relations.

Each section of the National Board has a set of offices. Both the labor members and the industry members have their own assistants who give advice daily to workers or their representatives, or to employers. In addition, there is a Board staff consisting of a legal office, a case-analysis office, an economic analysis office, an administrative management office, and others.

Voluntary petitions are processed by the staff acting under the supervision of the Board. Some cases are processed through the Review and Appeals Committee. Where action in that Committee is not unanimous, the cases are considered by the Board itself. The Board as a rule operates by divisions. Two or more divisions may operate at the same time. A "full Board" consists of 12 members, 4 from each side.

In a discussion of general policies as well as in considering action in particular cases, a tripartite board has the advantage of first-hand information as to the practical needs of the employers and employees and of the possible unstabilizing effect of any action that is proposed. The action is taken as a rule only after full consideration and debate. Much of this consideration occurs outside formal meetings of the Board. On important matters, tripartite Board committees are established which work together with the staff in a preliminary analysis of the problems involved and an appraisal of the projected action. Many of the discussions are informal and take place in the office of one of the public members assigned to the particular problem.

Quite often, the matter is not brought into the full Board until all points of view have been explored, and the matter is ready for final action. At times, no formal Board meeting is held until the matter is virtually ready for a vote. By that stage, each member of the Board is fully aware of the views of the other members and further debate would merely provide an opportunity for speeches for the record. Dissents are frequently for the record only even where dissents are on matters of substance and accompanied by a dissenting opinion, the opinion is more likely than not, in terms of the vigorous expressions usually appearing therein, a reflection of the emotions of the losing party. As a rule, when the case has been disposed of, the Board moves on to the next item of business without the slightest rancor. I might point out, parenthetically, that the volume of work turned out by the Board since the Steel case compares favorably with the volume of work turned out at any comparable period in the past. All of us realize that we have a job to do, and there is no difficulty in closing ranks and proceeding to the next order of business without serious loss of momentum.

VOTING STATISTICS

As an indication of the cooperation within the Board (and in answer to those who charge the Board with a prolabor bias), I might point out that the 21 general wage regulations adopted by the Board so far, 16 have been unanimous, 3 have had a labor dissent, 1 has had an industry dissent, and 1 has had a partial dissent by labor and a partial dissent by industry. The figures on Board resolutions are similar. I think this is a truly remarkable record. Over 99 percent of the cases coming before the Board to date involve voluntary petitions by employers, or employers and unions jointly, seeking approval of wage adjustments. Likewise, with respect to Board action in particular cases, as I have testified previously, the National Board has been unanimous in almost 93 percent of its rulings or orders, with labor dissenting in nearly 5 percent and industry in less than 3 percent of the cases. Incidentally, more than 50 percent of the cases involving voluntary petitions for approval come from nonunion employers.

This remarkable record is accomplished despite the tremendous pressures exercised on the labor and management representatives of the Board by employees or unions and employers who feel that their petitions have merit and should be granted in full. It should be remembered that when the Board modi