coal below cost, except in time of war or some extraordinary domestic situation. They are coming here now opposing the Guffey bill, and down in their hearts they still have the desire of being able to continue doing what they have been doing so long-buying their coal at less than cost.

The bituminous coal wage contracts expire on April 1 in every mining district. And unless a new wage contract is negotiated between now and April 1, there will be no contracts after April 1, and the mine workers of this country will not have the right to work in the mines of this country after April 1 without the consent of the coal companies. Consequently, there will be no work on April 1, if there is no new contract negotiated.

What are the chances of negotiating a contract? Are the chances of being able successfully to negotiate a contract in the coal industry minimized and made more difficult by the fact that sales realization of the industry, the amount received for the tonnage of coal mined, has been reduced to approximately a point where the operators complain that they are not able to pay a reasonable wage scale or even the existing wage scale.

Senator NEELY. And that reduction is directly attributable to the chiseling practices of some of the operators to which you have referred, is it not?

Mr. LEWIS. Nothing else, Senator. They have voluntarily reduced their sales realization. They are now coming into the joint conference, or will come into the joint conference and show that realization is incapable of supporting the present wage scale, and then the miners of this country are affected by the failure of the operating side of the industry to compose the business relationships in their own household or even adhere to tne provisions of the coal code, supposed to have the power of law.

When the Coal Code was negotiated, the operators claimed to the Government that they would be obliged to have at least a realization of $2 a ton to support the wage structure. The mine workers felt that price was too high and said so, but the Government acquiesced, saying that they thought the $2 rate for mine-run coal, by and large, throughout the country, was a reasonable rate, and that the price structure of the industry could be predicated upon such a reasonable base.

i

Well, what is the answer? Last year, on the 1st of April 1934, the hours in the industry were reduced from 8 to 7, and the wages were increased 9 cents a ton on the tonnage mined and 40 cents a day for the day workers. Applying that wage increase and the shortening of the hours to the wage structure, we find that the sales realization for 1934 of Appalachian Coals, Inc., which marketed about 39,000,000 tons last year, was approximately $1.75 a ton. That realization was achieved before the widespread wave of chiseling began in the industry. It shows that under the best of conditions the operations of Appalachian Coals, Inc., lacked 25 cents a ton of their annual production of achieving the goal of realization they assured the Government was necessary to uphold that wage structure.

In other words, they extended contracts, they favored some friends, they delivered some tonnage to old-time customers and protected them, and they achieved a realization of $1.75 a ton. Since they achieved that realization this same Appalachian Coals, Inc., by vote

of its membership, has reduced the prices at which its members were permitted to sell and in addition now is being compelled to revise its affairs so as to meet the situation revealed in this paper I have just read here. It demonstrated without question that there is no hope of the coal industry being able to stand on its own feet through the benefits of the Bituminous Coal Code.

There is no enforcement in the Bituminous Coal Code. There can be no enforcement in the Bituminous Coal Code. The life has gone out of the Bituminous Coal Code, both as to prices and as to violations of the labor provisions. Why, Mr. R. C. Tway, in Harlan County, and his associates; the United States Coal & Coke Co., in Harlan County, a subsidiary of the United States Steel Corporation; the Western Kentucky Coal Co., in western Kentucky, a subsidiary of the Great North American Utility; the Elk River Coal & Lumber Co., of West Virginia; and the McKell interests pay no attention to the provisions of the Coal Code that they do not want to pay.

The Western Kentucky Coal Co., Senator, is one of the chief competitors of Indiana. The public utility that operates that company follows the practice of using such of its own production as it wants to use, and dumping the rest of the tonnage on a defenseless market, in order to give that company higher running time, greater volume, and reduced costs; and it does so with impunity, because it has found a Federal judge on that bench who has held that the Coal Code has no force or bearing in that field.

The Coal Code cannot be enforced under present conditions. It is. not being enforced. There is no attempt being made to enforce it. The operators disregard its provisions with impunity.

The United States Steel Corporation in Harlan County employs a large number of mine guards to police its coal towns. Lynch, Ky., has a population of about 7,000 or 7,500 people. Under the feudal system maintained there, they normally have a force of 17 police officers to police that community, and no man may call himself his own in that community except by and with the consent of the superintendent of the United States Steel & Coke Co. They have recently augmented that force, to prevent meetings of mine workers, to prevent men from exercising their right to join the United Mine Workers of America instead of the company-maintained company union. They have joined in subsidizing the sheriff of Harlan County, and the sheriff of Harlan County has recently and perhaps even as I am speaking now may be maintaining a force of 191 deputies to police the roads and coal towns and camps in that county, preventing the men from holding meetings and joining the United Mine Workers of America, and preventing any attempt toward enforcement of the provisions of the Bituminous Coal Code.

The United Mine Workers have protested in vain. To whom? To the Coal Section of the N. R. A., to the Compliance Division of the N. R. A., to the Legal Division of the N. R. A., to the General Counsel of the N. R. A., to the Administrator of the N. R. A., to the N. R. A. Board, to the Federal Trade Commission, to the Department of Labor, to the Department of Justice. The net results of our protests have been nothing. And yet operators trying to observe loyally and honorably and honestly the provisions of the code, and trying to pay the wage set up under the provisions of the coal code and wage contracts, are daily being penalized by this unrestricted

tonnage from Harlan County and western Kentucky. They make no pretense at observing either the wage scale or the right of collective bargaining, or the prices set up under the Bituminous Coal Code. Yet there are witnesses who come before this honorable committee and say, "Our lot is indeed a happy one; just leave us alone and extend the coal code", in the face of this record, which shows that the price structure has broken down; that the sales realization of the industry has broken down; that the sales realization of the industry is reduced to a degree that ruins the stability of the national labor relationship. Why, Senators, the operators are demoralized. They met in joint conference in this city, the representatives of the operators and miners, to the extent of 200 men, 100 or so on each side, on February 18. Do you wish to suspend now? Senator NEELY. Yes.

2:30?

Mr. LEWIS. Certainly.

Will it be convenient for you to resume at

Senator NEELY. The subcommittee will now adjourns until 2:30 this afternoon.

(Whereupon, at 12 o'clock noon, a recess was taken until 2:30 p. m.)

AFTERNOON SESSION

The subcommittee reconvened at the expiration of the recess, 2:30 p. m.

Senator NEELY. Mr. Lewis, you may proceed.

Mr. LEWIS. With the permission of the committee, I would like to yield a few minutes of my time to President Green of the American Federation of Labor, who is not able to stay indefinitely.

Senator NEELY. Mr. Green is recognized.

STATEMENT OF WILLIAM GREEN, PRESIDENT OF THE AMERICAN FEDERATION OF LABOR

Mr. GREEN. Mr. Chairman and members of the committee, I feel that it is my duty to present to you the attitude of the American Federation of Labor toward this proposed legislation. The American Federation of Labor is in thorough accord with the Guffey bill and is standing fairly and squarely with the United Mine Workers of America in support of this measure.

It is not my intention to go into a technical discussion of the bill. We feel that it was carefully and scientifically drawn. A great deal of thought and care was given to the preparation of the measure. We are of the opinion that its administrative features are practical; that the provision for regulation and control are sound and constructive; and that it represents the practical and constructive approach to the solution of the economic problem in the bituminous coal industry.

Time and experience have shown that it is impossible for the owners and managers of the bituminous coal industry to establish and maintain stability. They cannot put their own house in order. Even the attempt to stabilize the industry, to eliminate unfair trade practices, and to protect standard rates of pay and standard working conditions throughout the bituminous coal industry through a coding process has not proved to be entirely successful. It is inconceivable that the American people would favor the continuation of cutthroat

competition with all its demoralizing effects, tearing down standards that ought to be permanently maintained.

I want to make this one further point, that it would not be so bad if those responsible for the demoralized conditions in the bituminouscoal industry were its only victims. If the management sustained financial losses through the introduction of these demoralizing factors, through the policy of unfair trade practices, we probably could say amen, but the trouble is they are not the real victims. The victims are the men who enter the mines, mine the coal, risk their lives, and make sacrifices that no other workers in America make. These are the men who are the victims, and it is because we want to protect them and the communities in which they live that we are appealing to Congress to enact this Guffey measure into law.

That covers my statement, Mr. Chairman, unless you want to ask me some questions.

Senator NEELY. Mr. Green, the committee is very glad to have heard you.

Mr. GREEN. Thank you, Mr. Chairman.

FURTHER STATEMENT OF HON. JOSEPH F. GUFFEY, UNITED STATES SENATOR FROM THE STATE OF PENNSYLVANIA

Senator GUFFEY. Mr. Chairman, I would like to make a briet statement on the record. In the protest of the Northern West Virginia Subdivisional Coal Association against the passage of S. 1417, introduced into the record of yesterday by one of the officers of that association, you will find on page 45 thereof an insinuation that either some member of my family or myself is interested in a tract of 100,000 acres of coal land in West Virginia.

Senator NEELY. Senator Guffey, will you read that part of the protest to which you refer, in order that it may appear in the record? Senator GUFFEY. The part to which I refer reads as follows:

If the Government takes these undeveloped coal lands off the hands of their owners at a fancy price, it will be very nice for the owners. As we have said, there are doubtless millions of acres of such coal lands. One company alone in this district, the J. M. Guffey Co., has over 100,000 acres of such lands. But wnile it will be very nice for the owners to be able to unload on the Government, it will be very hard on the rest of the industry and on the public, which has to pay the price, even assuming that the figures set up in the bill are adequate for the purpose.

In the latter part of the 1890's my uncle, Col. J. M. Guffey, acquired in West Virginia a coal field consisting of approximately 125,000 acres, and title was taken in the name of the J. M. Guffey Co. This coal field was later acquired by Andrew W. Mellon and his brother R. B. Mellon, through a banking transaction. Since that time the said coal field has been sold to the Koppers Co., and the Koppers Co., through the president of that company, is now appearing in opposition to the passage of the bill referred to. Neither my uncle's heirs nor any member of my family are in any wise interested in any tract of bituminous-coal land anywhere, to my knowledge. STATEMENT OF JOHN L. LEWIS, PRESIDENT OF THE UNITED MINE WORKERS OF AMERICA-Resumed

Mr. LEWIS. The main source of objection as expressed during the hearings by the operators opposed to the bill, has been that they would prefer to see the Bituminous Coal Code of Fair Competition continued

for at least 2 years so that whatever its merits and defects might be, there would be more experience upon which to base permanent legislation. The attitude of our organization as well as that of the operators controlling a majority of the tonnage in the industry, is that the Coal Code has broken down in its price provisions, and so long as it does not contain production-control provisions, it will be ineffective.

Aside from this, however, the attitude of those who oppose the Guffey bill because they wish the continuance of the code, is fundamentally untenable and inconsistent, for the reason that the Guffey bill itself embodies the code and all its voluntary and democratic methods of procedure. If an operator is favorable to the code and not opposed to production control through the establishment of quotas, he should have no objection to the Guffey bill.

I quote from an editorial entitled "Government Control", published in The Black Diamond, a trade weekly publication of the coal industry, dated March 2, 1935, as follows:

As a matter of fact, such stability, or approximate stabilty, that the industry has ever attained has inevitably come from forces other than those exercised by the producers. It was due to the stabilization of labor through union control of wages that a large section of the bituminous coal industry for a time enjoyed a degree of prosperity; it was only when N. R. A. forced standardized wages upon the remainder of the industry that figures approximating profits were found in the books of many companies in the heretofore nonunion fields. Frequently enough, it is true, high rates of wage for union labor have penalized the union operators, but there are few of them that would go back if they could to the days before the union.

I call the attention of the committee to the fact that almost without exception every witness representing the operators that came before this committee has indicated his satisfaction with the union relationship and the collective bargaining agreements that are in effect in the industry.

As this editorial says, it is obviously true that before the N. R. A. gave labor an opportunity to organize in certain sections of the country, the operator who did deal with the union, and who did recognize collective bargaining, and who did pay a living wage, suffered a penalty every day that they were in the market for their benevolence; that the negotiation of the wage structure throughout the industry has equalized and stabilized that largest factor of cost in the industry known as the labor cost; and I am glad to quote this truthful statement of one of the leading organs of the coal industry, which makes clear the force of my previous statement that the operators are unable to organize themselves so as to be affirmatively articulate on any question.

Mr. Lesher has submitted on behalf of Mr. Harriman, president of the United States Chamber of Commerce, a statement opposing the Guffey bill. In this statement Mr. Harriman expresses doubt as to the constitutionality of the mesaure and declares that it goes entirely too far in the exercise of Government control and regulation.

While it is true, of course, that the United States Chamber of Commerce may have various reasons for being opposed to a specific measure such as the Guffey bill, yet that organization went on record n as early as 1930 in favor of the establishment of a Federal tribunal to control production and to stabilize the bituminous coal, oil, and umber industries. This was done through a referendum vote, as a