Mr. LESINSKI. I disagree with the gentleman.

Mr. SIFTON. We think the sound method of reciting the profit story is percentage of net worth.

Mr. LESINSKI. Is it not true, Mr. Sifton, that you always base your profits on the peak year of 1929? If so, you want to figure that the peak profits of that year were about $6,000,000,000. The tax rate started at 4 percent. Last year the peak was $17,000,000,000.

Mr. SIFTON. After taxes.

Mr. LESINSKI. And the tax rate started at 20 percent, or 22 percent, and went up as high as 75 percent, which we did not have in 1929. So if you will figure the gross profit, with the taxes——

Mr. SIFTON. $29,000,000,000.

Mr. LESINSKI. It is more than that, sir. When you get into big amounts over $5,000,000,000, and the Government takes 75 percent of that, it runs into billions.

So the gross profits were very much higher than the basic rate in

1929.

Now, when you are talking of management and labor having schools, or sitting in the same class, it is a queer thing that a doctor, a medicine man, sits in one class, and a dentist in another class. Why do they not have a combined class? Because it just does not apply in there, any more than it would in the case of labor and management.

Those are separate classes.

Mr. BREHM. I would like to interrupt there. The dentists and the M. D.'s do dissect on the same body, and take many of the same classes, especially in anatomy.

Mr. LESINSKI. In some, yes.

Mr. BREHM. All colleges have business administration courses.

It is strange, though. You get reports on profits. Westinghouse, Armco; some of the larger companies absolutely having to borrow money, and they had the largest income in their history last year, such as Armco did, but they had to borrow money. They expand, and more jobs are created.

I hope we do not destroy the profit incentive.

Mr. LESINSKI. In prewar days, prior to 1940, you could buy lumber, f. o. b. mill, at $15. You are paying $85 today. That makes the difference. That is why you need that much more capital.

And regardless of what your profits are, you have to put it right back in the business if you want to carry that business on.

Mr. OWENS. I understand, Mr. Chairman, the figures I had, that if 90 percent of the firms in the United States had a complete loss for 6 months, say for 6 to 7 months, that everything they had would be wiped out; and if you would take the difference between that $6,000,000,000 that the gentleman from Michigan mentioned, and the $17,000,000,000-$11,000,000,000-you would have only 25 cents a day to give to each workingman in the country, if you took every bit of that profit. That is all you would have to give to him. So I cannot see the point at all.

Mr. LESINSKI. Mr. Owens, no one denies that corporations should make money. They could not exist. Corporations must have profits. I know that in my own business. We do about a million dollars' worth of business a year, and I know about the expenses and how much money you need to carry on.

Mr. SIFTON. I want to point out that if a corporation would go broke in 6 or 7 months most workers would go broke long before that. Mr. BREHM. Are there any other witnesses, or anyone who cares to testify regarding this legislation? I want everybody to feel that they have had a fair and equal chance to be heard.

Is there anyone in the room who wants to say anything, whether they are scheduled to be heard or not? I would be glad to hear them. (There was no response.)

Miss HILDA SMITH. Mr. Chairman, may I say for the National Committee for the Extension of Labor Education that we very much appreciate the full and fair hearings that your committee has given us, the extended time, and the provision to hear all of our witnesses.

Mr. BREHM. Thank you ever so much.

If there are no other witnesses, the subcommittee will stand adjourned, subject to call of the Chair.

(Whereupon, at 4 p. m., the subcommittee adjourned subject to call of the chairman.)

LABOR EDUCATION EXTENSION SERVICE

TUESDAY, APRIL 27, 1948

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE No. 1,

COMMITTEE ON EDUCATION AND LABOR,

Washington, D. C.

The subcommittee met, pursuant to call, at 10 a. m., Hon. Max Schwabe (acting chairman of the subcommittee) presiding. Mr. SCHWABE. The committee will be in order.

The Subcommittee on Education is continuing the hearings on H. R. 6202, introduced by Mr. Madden, of Indiana, and H. R. 6249, introduced by Mr. Tollefson, of Washington, the subject being a proposed Labor Extension Service.

The first witness this morning is Mr. J. O. Keller. Mr. Keller, will you state your name, your connection, and whom you represent, and also your address for the benefit of the record?

TESTIMONY OF J. O. KELLER, ASSISTANT TO THE PRESIDENT, THE PENNSYLVANIA STATE COLLEGE, IN CHARGE OF EXTENSION, STATE COLLEGE, PA.

Mr. KELLER. My name is J. O. Keller; I am assistant to the president in charge of extension at the Pennsylvania State College, located at State College, Pa. That is also my home address. I am a resident of State College.

I am not appearing, however, to represent this institution but I am appearing as representing the National University Extension Association as chairman of its committee on governmental information and action.

Mr. SCHWABE. Would you mind explaining for the committee just what the National University Extension Association is?

Mr. KELLER. Yes, sir. The National University Extension Association is an organization of some 68 institutions of higher learning that offer courses by extension, general extension, that, as distinguished from agricultural cooperative extension.

Mr. SCHWABE. In other words, it is an extension service on many subjects?

Mr. KELLER. On many subjects, yes, other than agriculture and home economics.

For the most part our membership consists of State universities, land-grant colleges, and some few private institutions such as Harvard, Columbia, Chicago, Washington University, St. Louis, and so forth. Perhaps of the 68 I would say about 16 or 18 are private institutions and the rest are public institutions.

When I say that I represent them I do not mean that every institution agrees with what I am going to say, but that the majority does. We have had a meeting regarding the bill, and I am going to state the opinion of the majority of the membership.

Mr. SCHWABE. You may proceed with any statement you may have. Mr. KELLER. I have prepared a written statement, and I will try to present it briefly and not read it.

Mr. SCHWABE. It is short enough, if you wish to read it. Go ahead. That will be all right.

Mr. KELLER. All right, sir.

The National University Extension Association was asked to endorse this bill, and we felt that we could not. The National University Extension Association, therefore, includes in its membership most of the larger institutions of higher learning that have conducted extension programs for some length of time and whose programs at present are well established.

In using the term "extension," I refer to the off-campus services rendered by schools and colleges in fields other than cooperative agriculture and home economics programs. Programs of agricultural extension have been carried on under the terms and provisions of the Smith-Lever and succeeding legislation in a sense separately from socalled general extension.

At the annual meeting of the National University Extension Association in 1947 discussions were held on legislation affecting workers' education. Our association is in favor of legislation for adult education and labor education, believing that assistance should be given to all citizens to extend their education, just as the same opportunity is given to the farmer. It is in light of these circumstances that I am presenting the attitude of the National University Extension

Association.

Our association was requested to endorse S. 1390 and H. R. 4232, which was the Madden bill prior to the new number, now H. R. 6202. I am sorry that my written brief uses the former number, because only this morning did I receive the other copies, and I see there are some changes. But our membership in general felt that the provisions of these bills did not permit of our endorsement.

The provisions as set forth in the bills do not meet the requirements of a complete adult and labor educational program, nor does the administration of the bills meet with the approval of most of our member institutions.

Many members of the association are now carrying on workers' education and have developed effective programs with organized labor. In most cases such programs were developed jointly with the respective unions and the control of the standards of instruction remained with the institutions. It is not necessary to establish a "State board," in our opinion, to control the types of programs that would be most effective for the workers.

A more efficient procedure is to work directly with the organization requesting the service and develop work that is consistent with the policies of the institutions concerned and that of labor organizations. Therefore, we do not favor the establishment of a State board to control either the funds or the programs.