In the case of Illinois a gain of sixty-eight one-hundredths of 1 percent of the national total is a gain of 2,436,546 tons, or a gain of 6 percent for that district over its 1934 production.

Your figures do not agree with your exhibit, Mr. Carter.

Mr. CARTER. I believe they do, Senator. You will find the Illinois figures underscored by a blue line.

Senator MINTON. That is 2,437,086 tons in your exhibit.

Mr. CARTER. That is correct; the figure for Illinois should be 2,437,086 tons. Thank you, Senator.

Now, which district would lose business and be compelled by law to discharge some of their employees in order that this substantial transfer of tonnage might be made to these and other districts which are beneficiaries under the Guffey bill? The bulk of this tonnage would be torn from Kentucky and West Virginia. Specifically: Eastern Kentucky would lose fifty-four one-hundredths of 1 percent of the national total, or 1,935,333 tons, a loss of 6.4 percent of that district's 1934 tonnage.

Senator MINTON. That is the northern West Virginia district, is it not?

Mr. CARTER. Eastern Kentucky. You will find that underscored by a red line.

Senator MINTON. That is district no. 4?

Mr. CARTER. That is district no. 7 on this exhibit.

The high-volatile fields of northern West Virginia would lose seven one-hundredths of 1 percent or 250,876 tons-a loss of 1.3 percent of that district's 1934 tonnage.

The high-volatile fields of southern West Virginia would lose ninety-seven one-hundredths of 1 percent of the national production, or 3,476,421 tons-a loss of 8.5 percent of that district's 1934 tonnage. The low-volatile fields of West Virginia and Virginia would lose 1.51 percent of the national production, or 5,411,764 tons-a loss of 12.8 percent of that district's 1934 tonnage.

You will note that, in arriving at these statistics, I am using the figures supplied by the Bureau of Mines and referred to by the proponents of the Guffey bill in order that the comparison that I am making shall be predicated upon the tabulation used by such proponents. I am advised, however, that errors in the Bureau of Mines' tabulations have been discovered indicating that the lowvolatile fields of West Virginia and Virginia would lose even more tonnage than is shown by the Bureau of Mines figures. Subsequent witnesses will have more to say about this point.

Senator NEELY. Mr. Carter, you know that Senator Guffey and other friends of the bill have agreed of record to an amendment that will correct any injustice that is threatened to West Virginia in this matter?

Mr. CARTER. I heard witnesses, certainly one witness, suggest that some changes would be necessary. Of course, as I said yesterday, Senator, the proponents of this plan of allocating tonnage or business or profits of monopoly very naturally find difficulty in agreeing upon a basis, upon an historical basis, for such allocation. Each interest naturally desires the basis to be that one which will give it the largest share of the profits in the proposed monopoly.

Senator NEELY. Mr. Carter, if an amendment should be agreed upon by virtue of which West Virginia would be done complete justice in the matter of allocating tonnage

Senator DAVIS. And no injustice to Pennsylvania.

Senator NEELY. And no injustice would be done to any coalproducing State, would you then favor the bill, or would you still oppose it?

Mr. CARTER. I am still opposed to the bill, Senator, and as to this very laudable effort of finding a plan that would not do injustice to any one and that might be equitable to everyone, I have not yet heard proposed such a plan; nor have I heard any proponent of this bill propose such a plan. I shall go further and say that I do not believe there is any such plan.

Senator DAVIS. Mr. Carter, is there any part of the bill that you would recommend to the committee?

Mr. CARTER. In a "yes" or "no" answer, Senator, I should answer "no."

Senator NEELY. Is there any sort of governmental regulation of the coal industry that you would favor?

Mr. CARTER. Senator Neely, the United States Government is today, through the instrumentality of the N. I. R. A. and the coal code that has been set up under it, exercising a considerable degree of supervision over the coal industry. For the first time the coal industry, under the code that it has been permitted to set up, has been able to cooperate; operators have been able to meet and try to solve and adjust and agree upon many of the difficulties that they were formerly prohibited by law from doing.

For the benefit of the Senators who were not here yesterday, permit me to repeat that I do favor a continuation of the bituminous coal code under the existing act, or under some modification of the existing act.

Senator MOORE. Were you in favor of the act when it was proposed?

Mr. CARTER. I took no part, either in favor of or against, the N. I. R. A. Act.

Senator MOORE. Do you say now that you believed in it before it was adopted?

Mr. CARTER. I believe generally in the N. I. R. A., but only as a temporary expedient.

Senator MOORE. Do you still believe in it merely as a temporary expedient?

Mr. CARTER. As a temporary expedient; yes.

Senator NEELY. Then, you do not believe in any sort of governmental interference with the coal industry?

Mr. CARTER. No.

Senator NEELY. You mean that you do not believe in any such interference by the Government, in the way of regulation?

Mr. CARTER. That is true. I do not believe in permanent regulation of the coal industry by the Federal Government, Senator. I do not believe we have gotten to the point yet that the industry needs that kind, or that the Nation needs that kind of supervision. We have a code. It is a flexible instrument. We can by trial and error improve it and gradually evolve whatever may be necessary. Time cures and improves many things.

Senator DAVIS. I had but one industry in mind when I voted for the National Industrial Recovery Act, and that is the bituminous coal industry. I wanted to be helpful to them, and thought it would help them. I am beginning to believe now, since I have listened to many of the operators, that it would be a mistake on my part if I voted to extend the time of the National Industrial Recovery Act, because you are all opposed, seemingly to me, to any sort of governmental regulation whatsoever.

Mr. CARTER. Well, Senator, let me add my plea to those that you will hear from others to to persuade you, if you have such a conviction, to change your mind.

Those of us in the coal industry may differ as to the perfection of the code. I believe that there is substantial agreement in the industry that the code has been of benefit to the coal industry and that part which you played and to which you have just referred in connection with the N. I. R. A. has been fruitful of results in the bituminous coal industry.

We do not want the coal industry to lose the code. There may be some that do, but I believe that the bulk of the industry would like to continue the code. We can change and modify and improve the code as we go along.

Senator DAVIS. I just want to repeat that the idea that I had in mind especially when I voted for the licensing section of the N. I. R. A. was nothing more nor less than to help the industry from destroying itself. Now, I might have been mistaken in that.

Mr. CARTER. I believe that the industry welcomed an opportunity under the N. I. R. A. to have a code and to have an opportunity to solve many of the problems that the antitrust laws had certainly imposed bars against when we were seeking to solve them prior to the passage of that act.

I know that in my case that I desired, and I believe I am correct in saying that it was the overwhelming sentiment of people operating mines in southern West Virginia and in Virginia in the low volatile fields with which I am particularly familiar, to cooperate and get the best instruments they could under the N. I. R. A. Senator DAVIS. You believe, then, that the N. I. R. A. has been helpful to the coal industry?

Mr. CARTER. I do believe so.

Senator DAVIS. And you believe it because of the fact that you have been more or less regulated by yourselves with the approval of governmental officers?

Mr. CARTER. The answer to that, Senator, is "yes", but let me explain my answer. We have been permitted to regulate ourselves, but I believe that government, when it permits any group to undertake such regulations, should of necessity impose some restrictions and supervision in the public interest. To that extent, I do answer "yes" to your question.

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Senator DAVIS. The production of coal, if I remember correctly, is running less than 350,000,000 tons now. The normal production of coal-I mean where conditions are normal-runs about 550,000,000 tons, does it not?

Mr. CARTER. Well, the production of the country has been 550,000,000 tons.

Senator DAVIS. It has been 700,000,000.

Mr. CARTER. Yes.

Senator DAVIS. And it has a production capacity of about a billion

tons.

Mr. CARTER. I do not know what the real productive capacity of the industry is, Senator.

Senator DAVIS. If it is necessary to have somebody at this time regulate the industry, will it not be necessary to have some regulatory power when we even get to producing 750,000,000 tons?

Mr. CARTER. We have that regulatory and supervisory power today, Senator.

Senator DAVIS. Yes: but you got it through the N. I. R. A.

Mr. CARTER. That is true, and it is my understanding that the President has requested and recommended to the Congress that the act be extended, at least in some modified form for a further period.

Senator DAVIS. But many of the coal operators have stated here that they do not want any form of governmental regulation. Will not your condition be just as bad when the country gets back to normal and you are consuming 550,000,000 tons of coal a year? Will it not be just as bad then as it is now, or was prior to the passage of the National Industrial Recovery Act?

Mr. CARTER. Senator, as to conditions now, I believe that the coal industry has as a whole during the past year enjoyed one of the most profitable years that it has had for a long period of time. So its condition today is better than it has been.

Senator DAVIS. Yes; but it is under governmental regulation. You could not regulate yourselves; you were just crucifying yourselves in business. If I take the testimony that has been given here from men in the coal business and from workers, the wage had dropped from $7.50 a day around the mines to $1.50 in and about the mines, and that the production of coal had dropped from 97 cents a ton down to around 40 cents a ton, and in many instances much lower than that. All this that you claim has come to us through governmental regulation. I want to be helpful, so far as I am concerned, to the bituminous coal industry, for God knows I have seen nothing but poverty stark through these mining regions of Pennsylvania and West Virginia. I want you to get it clearly in your mind, and I want to state it to Mr. Hawthorne, that I am not one of those who believe in governmental ownership of the industry. I am seeking here to get the truth and apply the truth to this industry, with the hope that we will drive poverty out of the coal-mining area.

Mr. CARTER. I believe, Senator, that you will find the coal operators all over the country-I know that you will find the coal operators in southern West Virginia-anxious to cooperate with you in anything, in any reasonable effort, to bring about improvement; not only in our own industry, but in any other industry.

No one desires poverty, but I am here, and others will appear before you, to try to help give you these facts that you seek. What I am trying to do now is to prevent, if I can, any mistake being made that will not help but will seriously cripple the coal industry; and it is my opinion that the enactment into law of the Guffey bill would do that. I believe the Guffey bill would seriously, if not almost beyond hope of repair, injure the coal industry

1

Senator DAVIS. Is there not anything at all about the Guffey bill that is helpful to the coal industry?

Mr. CARTER. At the moment, I do not believe there are any sections in the Guffey bill, when you strip the objectionable features that I see in it from them, that could be salvaged, Senator.

Senator DAVIS. Outside of your wanting to extend the National Industrial Recovery Act to work under these particular coal codes, what would you suggest that the Government itself might do to be helpful to the industry?

Mr. CARTER. Let it alone.

Senator DAVIS. And let it go back to the condition that existed in the coal industry prior to the enactment of the National Industrial Recovery Act? Do you want it to go back again to the condition in West Virginia and in Pennsylvania and in Kentucky and in Tennessee that existed prior to the adoption of the National Industrial Recovery Act?

Mr. CARTER. Senator, I do not want the coal industry or any part of it to retregrade in any fashion.

Senator DAVIS. But you could not help it. There was testimony here that a man did not get more than 20 cents an hour and worked 1 day a week. Do you want it to go back to that?

Mr. CARTER. Senator, of course, the answer to that question is "no." No person wants conditions of that kind to exist in any district. Senator DAVIS. That is what happened to it prior to that time. Mr. CARTER. Is it not a fact, Senator, that the real problem of coal industry is that we have a greater productive capacity than the needs of the country require?

Senator DAVIS. There are some parts of the Guffey bill that prevent the opening of other mines and increasing that production. Not only that, but there are some parts of the Guffey bill that want to retire some of this production. There are some good features in the bill, surely, although you yourself will not admit that there is anything good about it and think that you ought to be let alone.

Mr. CARTER. Senator, I have reiterated a number of times that I, and many of those with whom I am associated, many of my competitors, desire a continuation of the coal code under an extension of the existing act or in some modified form, and that we may then evolve, through the process of trial and error and by this cooperation

Senator DAVIS. You cut prices among one another, and as you cut prices and reduce the wages you destroy the buying power of the country. How many of these coal miners can live as the American standard of living requires they should live? How many of them can live in the coal-mining area?

Mr. CARTER. Senator, I do not know the answer to that question. Senator DAVIS. You surely cannot raise the standard when the maximum of coal is only so many million tons and you are going to open new mines and produce more tonnage to reduce the work that you have for the men in the mines.

Mr. CARTER. Senator, people engage in business enterprises with the hope of profit. The past experience of the coal industry and the overproduction that exists in it are not conducive to the entry