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expenditures, he is further quoted as saying that the picture is bleak and that the crisis is virtually upon us and this crisis will become particularly serious during the fiscal year ending July 1, 1951.

I made a notation there that I thought I might substantiate that statement a little further by inviting the committee's attention to what Mr. Wolcott had to say in the hearings before this committee on rent control, on page 390 of the hearings. He said virtually the same thing as I have just quoted Senator Byrd as saying.

No socialistic State has ever produced anything that can be compared to the freedom, the educational advantages, the spiritual wellbeing and the standards of living enjoyed by Americans, because under socialism there are no liberties-no freedom.

The private enterprise system is the brain child of good Americans; it is designed by Americans to suit our character.

Let us not trade this proven machine for a new, unknown quantity.

Let us not barter our American freedom for a mess of socialistic pottage.

Let us not apologize for our American way of life. I wish to express my appreciation for being permitted to appear, Mr. Chairman. If there are any questions I can answer, I will be glad to.

Mr. MONRONEY. Thank you very much, Mr. Proffitt. Are they any questions? (No response.) Mr. MONROXEY. If not, we appreciate your testimony very much. The committee will stand in recess until 2: 30 this afternoon. (Whereupon, at 12:58 p. m. the committee recessed, to recon vene at 2:30 p. m.)

AFTERNOON SESSION

The CHAIRMAX. The committee will be in order.

We will hear Mr. Fuller of the National Lumber Manufacturers Association.

You may identify yourself and proceed, Mr. Fuller.
Mr. FULLER. Thank you, Mr. Chairman.

STATEMENT OF GEORGE M. FULLER, VICE PRESIDENT, NATIONAL

LUMBER MANUFACTURERS ASSOCIATION

Mr. FULLER. My name is George M. Fuller. I am vice-president of the National Lumber Manufacturers Association, an organization of 15 regional and species associations representing lumber manufacturers in all parts of the United States. I appreciate the opportunity of appearing before this committee to express our views on H. R. 4009.

First, let me say that we are opposed to the basic philosophy of this type of legislation and we are opposed to handling a subject of this kind with an omnibus bill such as H. R. 4009.

Slum clearance is a tremendous problem in itself and should have special treatment. The bettering of conditions for the farmers is also a subject that should have single and careful study.

Public housing should also have singular treatment. Home financing should also have individual study and legislation. To place all

of these in one bill is confusing, not only to the public, but to our over-worked Congressmen.

In my opinion, to lump all of these together denies each problem the consideration it deserves.

Many people regard the Federal Treasury as the logical source of funds for any program which would seem to be desirable.

This enthusiasm for Federal aid as a supposedly easy solution of a current problem frequently discourages a clear analysis and understanding of the basic nature of the problem for which a solution is sought.

If a local problem exists in a large number of communities, States, or regions well-scattered throughout the country, it is said to be a Nation-wide problem and therefore a “national problem" even though it is still fundamentally local in character.

Unless we learn to avoid this easy and fallacious transposition of local problems into national problems with the simultaneous transfer of responsibility and initiative, we cannot hope to avoid centralization of governmental authority and eventually we shall discover that we have developed a welfare or socialized state at the price of freedom of both our States and our enterprise.

Before assuming that the people of certain cities require financial aid from the taxpayers of other States in the form of Federal grants, it would seem wise to examine the possibility of self-improvement on the part of the people of those communities.

It should be remembered that along with financial aid they will receive standards and administrative procedures established in accordance with what the Federal Government thinks is good for them, rather than standards and procedures of their own choosing.

Generally the demand for financial aid for “poorer" States and communities has not arisen in such States and communities. Frequently the demand has come from social welfare groups, exponents of planned economy, and others who are animated by a desire to impose on everyone the degree of theoretical perfection they think is desirable.

It is not the function of the Federal Government to equalize conditions as between communities or as between individuals. That is an utterly impossible task.

It must be remembered that the wealth and income which can be taxed by the Federal Government is exactly the sum total of the wealth and income of the 48 States, the District of Columbia, and our Territories and insular possessions.

Justification for Federal appropriations or financial assistance on the theory that the Federal Government has resources beyond those of State and local governments is clearly a fallacy.

We are opposed to Federal public housing because we believe that it is just another step toward socialism and a centralized bureaucratic welfare state. No one has adequately explained just how and why an agency of this Federal Government or any person can equitably designate those who should and those who should not occupy subsidized housing. Should he be a man with a wife and two children with income of $1,500 a year; or should he be a man with a wife and two children with a salary of $2,500, or $2,505!

Gentlemen, this is a riddle, and I have had no information that satisfactorily answers it. Certainly the language of H. R. 4009 on

page 27 assumes that the wisdom of a Solomon will be found in the authority to determine this problem.

In considering this legislation, I should like to speak on just two phases, the first of which is the bypassing of the Appropriations Committees of both Houses for funds specified as annual contributions, in section 205, of H. R. 4009.

We suggest that on page 42, line 2 of H. R. 4009, immediately preceding the quotation marks, a new sentence be inserted to read as follows: No contract for contributions under this act shall be entered into by the Authority except following specific appropriation by the Congress of funds for the first year's annual contribution called for by such contract.

This, gentlemen, was an amendment offered to S. 1070 in the Senate, and in my opinion, its defeat was unfortunate. I am bringing it to your attention now in the hope that you will amend this bill to take care of this omission, and will by your action recommend this change which I believe is fair.

Under this bill, the Public Housing Authority may obligate and commit our Federal Treasury to spend $400,000,000 annually over a period of 40 years, or a total of $16,000,000.

The Congress would have to appropriate this money as a prior commitment made by the Public Housing Authority. This provision would merely make the Appropriations Committee, and yes, the (ongress as a whole, a rubber-stamp body for a branch of the executive department.

For Congress to relinquish its prerogative seems to me unnecessary and unwarranted. The Banking and Currency Committee, by its action, will remove from the Appropriations Committee and even from the Congress as a whole the right to determine whether the activities of a Federal executive agency are being properly or improperly carried out before such an agency is allowed a continuing appropriation.

Passage of this act would commit future Congresses and would not permit periodic review and appraisals of this entire situation. You are fixing an obligation by the passage of this bill just like the interest on our national debt.

There is no escape. Conditions may change, and fortunes may not be as rosy as they are today nor may we be in a financial position to carry on the obligation made by this Congress, an obligation made with inflated dollars.

In asking that you amend H. R. 4009 to keep this right within your hands, we are merely asking you to continue a normal practice. Certainly, the Public Housing Authority has no right to expect treatment not accorded any other branch of the executive department.

Surely, you gentlemen should be aware of the Housing Authority's activities and retain the right to appraise its work. I should think that you would hesitate before giving up this function and in faet even resent anyone attempting to remove the prerogatives of Congress.

If any division of the Public Housing Authority in the district of any one of the members of this committee committed some imwarranted and unjustified act, you would be the first to call for a right to review its activities.

History has proven that some branches of our Government, no matter how conscientious, sometimes make errors. The Constitution was conceived to place the proper emphasis on checks and balances to

preclude any one branch of our Government being placed in an autonomous state,

I think that President Jefferson, one of the founders of the Democratic Party, expresses this thought very aptly. He felt that Congress should be the watchdog. The activating branch of our Government, the executive branch, should be answerable to you gentlemen here. President Jefferson said:

If we can prevent the Government from wasting the labors of the people under the pretense of caring for them, they will be happy. The same prudence which in private life would forbid our paying our money for unexplained projects forbids it in the disposition of public money.

With the great amount of research being carried on by private industry, we are opposed to the provisions of title III-Housing Research, as we believe that industry can best handle the job. Increasingly large Government expenditures which mean higher and higher taxes discourage research activities by private industry. High taxes have a definite restrictive effect on the development of new products.

Despite the present heavy taxes, private business is making great strides in producing better products through research. But the tax burden should be lightened and not increased so that more private capital expenditures may be made and more research carried on.

Based on Government data, there are more than 70,000 people engaged in private industrial research today with an annual expenditure of over $300,000,000.

In the lumber and forest products industries alone, our records show 1,190 individual companies and associations are conducting 8,980 various research projects for the improvement of wood uses, including housing, and better utilization of our forest resources.

As exhibit A I submit this copy of Forest Products Research Guide, 1948 edition, which lists the research being done and who is doing it. For example, in the field of housing and other building, chapter IV covers 52 fields of industry research.

Typical of these studies are light frame construction such as houses, barns, and other farm buildings; modular coordination and related developments in "engineered” houses, wood floors, wood doors; and prefabricated houses.

This book is prepared for the guidance of industry in avoiding duplication of effort and coordination of projects. It is also made available to the various Government agencies so that they may take advantage of what the research industry is doing and thus avoid spending additional tax money in duplication of efforts already well advanced.

As a specific example of industry research, I cite the work of our own engineers and laboratory men. For the past 16 years we have been engaged in improving the use of lumber for all types of timber stru tures, including housing, through the use of the connector system of construction.

Through the use of connectors we are able to produce stronger buildings and at the same time use less material, which manifestly means savings to the consumer.

This research work has resulted in more than 150,000 buildings being built of wood. A large number of these were for housing. For example, in 1935 the lumber industry housed in the space of 10 months

some 300,000 Civilian Conservation Corps boys in prefabricated, demountable housing.

In the past 3 years we introduced to the housing field the new widely recognized trussed rafter for small one-story homes, multiple dwellings and garden-type rental apartments, which architects predict will soon become standard practice of construction throughout the country.

After some years of study, we introduced this money-saving idea in May 1946, when 180 small homes in South Bend, Ind., were built in record time for veterans. The builder, Place & Co., stated :

You know, of course, that our original idea in using trussed rafters was to eliminate as much of the interior partition framing as possible, and we estimate that about 400 board feet is saved in our two-bedroom home. Your trussed rafters also enable us to make use of the storage wall units, being built in our shop, as nonbearing partitions. As a clear indication of how Government can take and is taking advantage of industry research, the FHA in January 1948, 2 years after we introduced the trussed-rafter idea, distributed modified plans of their own and stated :

Definite savings in materials and labor requirements through the use of preassembled wood-roof trusses make truss framing an effective means of cost reduction in small dwelling construction. In a 26 by 32 feet dwelling, the use of trusses can result in a cost saving of approximately $70 as compared to conventional rafter and joist construction. In addition to cost savings, roof trusses offer other advantages of increased flexibility for interior planning and added speed and efficiency insite erection procedures.

Our research shows that clear-span trussed rafter construction alone can result in lumber savings of 27 percent as compared with conventional roof and ceiling framing on a one-story 26 by 3:2 feet interior dimension house.

In addition, as Davis S. Miller, president of the Producers' Council, points out, even greater savings are possible in the interior installations after the roof is on. Commenting upon the University of Illinois Small Homes Council research report of the construction of three industry-engineered homes using 16-foot span trusses spaced 2 feet on centers, Mr. Miller says:

It was found that many important savings came from the use of the roof truss, which left one large open room in which to work. In addition to savings in the installation of floor, ceiling, and wall surface materials, the following advantages were found: The entire job was under roof in a minimum of time; the open interior space was made available to plumbing, heating and electrical contractors in a minimum of time after the job was started; the exterior work can be done by the carpenters while the mechanical trades are working on the inside; there is complete freedom for the plumber in particular because he can make his layout in the simplest possible fashion and not be required to dodge around and through studs with inflexible pipe and fittings; chimney construction was easier.

Time savings are worth more than so many dollars per job. They mean more structures per year—more families and enterprises under new roofs. The time consumed in installing plumbing may be cut as much as 50 percent under clear-span trussed rafters.

Wallboard installation requires 30 percent fewer man-hours, and finish flooring 20 percent less time when installed before partitions are erected. Clear-span trussed rafters are time savers.

Fewer units to handle in the air mean better supervision, greater construction efficiency. Clear-span trussed rafters permit more trades

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