Mr. COLE. They cannot live in these public-housing projects, Mr. Gray, if this law is to be followed, can they?

Mr. GRAY. Well, I would not say that that particular segment has. But there has been public housing in the past which did take care of those people, until it was cut down and no more of it was being built. Let me give you a parable of what I am driving at which I claim is an important thing. Let us go into New York City, as a health measure. The very low income people, who cannot afford to pay for medical attention there, can probably get the best medical attention in the country. The fellow with plenty of money can get it. But this middle stratum cannot qualify as a charity patient and does not have money enough to pay for the top medical cost.

Mr. COLE. I realize that, but I do not agree with you that the lowest income

Mr. GRAY. You have the same thing in housing.

Mr. COLE. I do not agree with you that the lowest-income people have the same houses that the middle-income people do. I do not believe that is true, is it?

Mr. GRAY. Well, I wish I could answer the problem that you are asking me about.

Mr. COLE. I am thinking of the people who say that this is an answer to America's housing problem, and I also wish to point up the point that many arguments are made in behalf of the low-income-housing project, that is a welfare project, designed to take care of the poor, and I am pointing it up by saying that there has been no suggestion made to our committee that we do take care of the poor in housing. Mr. GRAY. I am not averse to that, Congressman.

Mr. COLE. I know, but no one suggested it. It has not been suggested. Nobody has made any comment about it that I know of.

Mr. GRAY. Well, perhaps the answer to that is that there has been so much resistance to this public-housing proposition, that we are fearful as to the cost limitation.

Mr. COLE. You are not quite serious about that, are you?

Mr. GRAY. Yes, I am serious about it. Look at the length of time your Taft-Ellender-Wagner bill has been pending before this Con

gress.

Mr. COLE. In other words, you would say then, that you would prefer to provide houses for people who make $2,000 or $2,400 a year rather than for the poor people.

Mr. GRAY. No, I did not make any such statement. I do take the position, however, that there are so many evils in housing that Solomon today could not correct them all in one bill.

Mr. COLE. Yes, sir; I certainly agree with you.

Mr. GRAY. And I claim that this bill is a step in the right direction. Mr. COLE. Well, it is a step in a direction; I will grant you that. The CHAIRMAN. Is it not a fact that private enterprise always seeks the field of greatest profit?

Mr. GRAY. Correct.

The CHAIRMAN. And that they would not go into this field because there is very little profit?

Mr. GRAY. That is the human reaction. That is the whole story in a nutshell.

Mr. MCKINNON. I was interested in your statement a few minutes ago that, if the Government was going to guarantee those loans, they should be loaned at a smaller rate of interest.

Mr. GRAY. Correct.

Mr. MCKINNON. I am going to switch the argument around a little bit. What would be your reaction if we had an annual wage for men in the building trades, if it would be possible to reduce our unit building costs? In other words, I come from California, where we are not bothered so much with bad days when you cannot build, but I notice back here that there are many days in the year when a man stays home and cannot work. People point to the hourly rate of a carpenter or bricklayer, but they do not know that this man may be home half of the time and not making as good an income as his wage rate may indicate. If some arrangement could be worked out where he would be guaranteed an annual wage, do you think it would be possible to arrange longer working days, during the time when the weather is good, or some other arrangement that would allow the man, first of all, to make a better income than he is making now, and yet, at the same time, to allow the builder, and the home purchaser, eventually, to have a lower labor cost in his home due to the annual guaranteed wage. Do you think anything could be worked out along that line? Mr. GRAY. I wish it could. We have given serious thought to that very question. But it seems to be so impossible to develop any system in the construction industry to obtain this so-called annual wage.

For instance, I have worked as a bricklayer. I have worked for as many as 10 different contractors in 1 year, and probably in 6 or 7 different sections of the country. Perhaps I can give you an illustration. Let us take the Hungry Horse Dam in Montana. I went out there and met with the contractors that were performing that work, signed an agreement with them, with a no-strike provision in the agreement. Now, at Kalispell, Mont., up to the time when this dam was to be constructed, 600 building tradesmen, of all different crafts, was all that that community could serve a livelihood to. The construction of that dam is going to take from 4,500 to 5,500 mechanics at the peak. Now, your construction worker primarily is a Nation-wide pool of migra tory workers that just have to, in order to obtain a livelihood, perform the service that the public demands, moving from spot to spot like that. When that job is done, due to facilities that that dam will furnish, through hydroelectric plants, and so on, the population of that community is going to increase. And, when it does increase, perhaps the number of building-trades workers serving the normal needs of that community will increase from 600 to 1,000, and possibly 1,500, but nothing like the total number required for this one job.

Under those conditions, unless we go into a Government subsidy for the whole industry over all, which I do not think Congress is ready to do, I do not know how it would be possible to develop a system on an annual-wage basis for all workers in the construction industry. I wish we could.

Mr. MCKINNON. I would not say all workers, but I would say this: I think the construction industry has accumulated habits in the past that are often costly. In other industries we have found that the more you can reduce unit costs the bigger market we develop. Now, we are interested in building a lot of homes in our country in the next 4 or 5 or 10 years. We know that, every time we can reduce the cost of building a home and get the home down 10 or 15 or 20 percent in price, we bring in a much larger market for the purchase of those

homes. The curse of the home-building industry today has been that costs are high and people cannot afford to buy the kind of home that is a sound investment over the long run. If certain contractors could be encouraged not to have this spotty hiring and firing and laying off that they have, but to maintain a steady pace, a steady development, in producing the homes we need in the years ahead, perhaps some arrangement could be worked out whereby a guaranty of employment over a period of time could be provided instead of the hirings and lay-offs that we have had in the past. That would work toward reducing the cost of homes and in so doing provide an expansion of the market. Do you understand what I mean?

Mr. GRAY. I understand, and I had a thought in mind along that direction. I think tremendous research work has got to be done before that objective can be obtained. Again we get back to publicized statements. Take the common, ordinary public statement that is generally transmitted to the public, that the Labor Department is labor's Department, that it is prejudiced in favor of labor. Well, I claim it should be prejudiced in favor of labor because it was labor's Department. I wonder if the same people would be willing to admit that the Commerce Department is prejudiced in favor of business. My whole idea is that your Labor Department should be rejuvenated, that it should get sufficient appropriations to carry on its functions and not have the labor-relations functions spread throughout a dozen different agencies of government, that the Commerce Department should be the same way, and that there should be a coordinating committee to do research work both for business and for labor, particularly on laborrelations problems, in order to find out what the two departments jointly could develop that would give the best service to the Nation and the public, whom, after all, we are all supposed to serve.

The CHAIRMAN. I wish to say that we have some other witnesses and we are very anxious to get through today. I hope we can run along toward a conclusion as soon as possible.

Mr. GRAY. Well, if there is nothing further, I thank you, Mr. Chairman.

The CHAIRMAN. Thank you very much for your fine statement, Mr. Gray. The great organization you represent certainly carries a great deal of weight with us, and we are always very happy to hear from you.

Mr. GRAY. Thank you.

The CHAIRMAN. We will call Mr. Goodman and Mr. Edelman, representing the Congress of Industrial Organizations.

STATEMENT OF JOHN W. EDELMAN, WASHINGTON REPRESENTATIVE OF THE TEXTILE WORKERS UNION OF AMERICA, ACCOMPANIED BY LEO GOODMAN, DIRECTOR OF THE CIO COMMITTEE ON HOUSING

Mr. EDELMAN. My name, Mr. Chairman, is John W. Edelman, Washington representative of the Textile Workers Union of America, and on this occasion representing the national CIO committee on housing. I shall make a joint presentation here wtih Mr. Leo Goodman, who is the director of the CIO committee on housing.

We havep lanned, Mr. Chairman, to make a very brief introductory statement, and then to attempt to, in the few minutes left to

us, touch on two or three other points which probably other witnesses have not covered in their testimony.

We open our formal statement by simply saying that we have appeared before this committee on so many previous occasions that we have considerable regard and attachment for the members of this committee, but we say we hope that it will be the last time, at least for several years, that we have to appear here on this particular problem. We feel very strongly that, at least in the year 1949, this particular issue of a fundamental housing bill should be acted upon.

We point out that the number of units prescribed in H. R. 4009 seems to us to be inadequate, but the CIO, for once, would like to demonstrate that it can be reasonable and conservative, and just for the sake of unanimity we will go along and not make any objections to the curtailment of the number of units here. We feel very strongly that, once this program is under way, it will develop sufficient political momentum, such a strong pressure from the public at large, that there will be no necessity for us to argue energetically for such extensions of the program as may be needed from time to time.

We would like to merely express our endorsement of the point made by Mr. Gray, of the American Federation of Labor, which we did not include in our testimony because of the rush of things, that it would be administratively far more feasible, Mr. Chairman, to exclude specific dollar limitation on unit costs and depend upon the soundness of the administration of the program. There would unquestionably arise from time to time in specific situations actual inhibitions to acaccomplishing the purposes for which the program is intended, and therefore it is our feeling that the administration of this particular public-housing program has in the past distinguished itself for economy in unit costs and its consistent spreading of the money to as large an area as possible and sharing it out, with scrupulous care, for geographical requirements of the country as a whole.

We would like to, just for a moment, comment on the point which was raised in the colloquy between Representative Mitchell and Mr. Gray. We feel that, in view of the parliamentary situation both in the House and in the Senate, it would be infinitely preferable and far more feasible if, before this bill was reported to the House, an effort were made to include within it certain additional omnibus characteristics; that is, particularly for the lower middle-income group. It is our feeling that this particular problem should be dealt with in the one bill.

Several proposals have already been presented for dealing with this problem. Representative Buchanan, for instance, has presented a pretty adequate bill from our standpoint dealing with the question of the middle-income group, and a brief discussion and study of that bill, I think, could develop a feasible piece of legislation dealing with this problem.

In general, trade-union members will not be benefited by H. R. 4009. To make a very rough and crude classification of where our members fit in the economic scheme of things, it might be said that our members earn over a dollar an hour, somewhere between a dollar and a dollar sixty or seventy cents an hour, let us say, and the nonunion workers will be exclusively benefited, with few exceptions. There are still some low union wage earners, but they are comparatively minor, and

the union members would be benefited to a lesser degree by this program, which program includes some measure of subsidy.

We have filed with you, Mr. Chairman, copies of this green covered booklet, entitled "Homes for People, Jobs for Prosperity, Planes for Peace, a Program To Meet the Inner and Outer Threats to Democracy's Survival," by Walter B. Reuther, president of the United Automobile Workers of the CIO and chairman of our national committee on housing.

Walter Reuther prepared this document, and it has been widely circulated. I might simply refer to it just for a moment or two, to the essential characteristics of this program, which I think is an additional or supplementary feature of vital significance in the whole housing picture.

This program was initially presented to the Senate Committee on Banking and Currency during the Housing hearings, was presented to President Truman, and I would like to announce to the members of the committee that the defense officials, our national defense officials, are now preparing to give it actually serious and practical consideration.

I would like to make one comment on the Reuther plan. It does not commit the CIO-we wish to be very clearly understood on this pointit does not commit the CIO to a doctrine that says that the only practical solution of the housing difficulties of America is the factorybuilt house. We say that the factory-built house is one solution which has been largely neglected; sufficiently demonstrated in the experiments that have been undertaken to be of tremendous significance and importance, it would be given far more study and backing than it has had.

In addition we think that probably, in the immediate future, conventional methods, with some considerable adaptations, as Mr. Gray pointed out-with site fabrication, for instance-are probably those which are more likely to be used in the very immediate future. We do, however, insist that the factory-built type of structure is going to be a necessary method, technique, or technology which must be developed if finally the housing problem of America is to be solved.

In essence-I shall not read the statement-but in essence the Reuther plan calls for and is tied in with the whole question of national defense. President Reuther, as you know, played a great role in the development of the adaptation of automobile plants to the manufacture of airplanes in the last war and pioneered in urging the mechanical engineering feasibility of that adaptation at the time when it was regarded as being entirely a fantastic and unworkable proposition. He points out that today we are manufacturing considerable quantities of airplanes which will be obsolete or obsolescent by the time they are produced and that the vital necessity is, however, to keep equipment and personnel trained for immediate application to a mass-production item when the technological developments have occurred, when the correct models have been developed, and when the need for expanded production should occur, which we, of course, hope and pray will not be the case.

In any event, he points out that there is a vast plant deteriorating in this country, for the production of ships, airplanes, and other implements of war, which should be kept in stand-by condition, and the production of low-cost factory-built housing might utilize that plant.

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