Mr. HENDERSON. Isn't it true that the German per capita income there has got to be qualified a bit because it is computed in terms of the German official exchange rate?

Dr. LUBIN. Yes.

Mr. HENDERSON. It is higher there.

Dr. LUBIN. Yes.

Senator BORAH. It reduces itself down to the fact that these comparisons with other countries are not very instructive.

Dr. LUBIN. They are instructive in this sense, Senator: they show that as far as the United States is concerned, our national per capita income is still relatively higher. Allowing for most of the bugs that might get into it, no matter how you calculate it, we do come out in terms of a larger per capita income in the United States, despite the depression years, than other countries.

WASTED RESOURCES

Dr. LUBIN. Now, the question arises as to the effect of our changing national income upon the various groups in the community. I want to point first to the effect of the decline in national income upon the wage and salaried workers of the country.

(The chart referred to was marked "Exhibit No. 9" and appears on p. 13. The statistical data on which this chart is based are included in the appendix on p. 196.)

Dr. LUBIN. This chart shows the amount of employment that was lost in each year since 1929 on the assumption that the 1929 level of employment could have been maintained. The figures make no allowance for the fact that the population has increased. They are minimum estimates and assume that the total number of people available for work has been exactly the same as it was in 1929.

The extent of the underestimate is shown by the fact that the number of people, who are now of gainfully employable age, is approximately 6,000,000 greater than it was at that time.

Assuming a working population of the size of 1929, you will note that if you add the employment lost in '30, '31, '32, up to 1938, the total number of man-years lost during that period of time was 43,435,000. Or, to put it in other words, if everybody who had worked in 1929 continued their employment during the past 9 years, all of us who were working could take a vacation for a year and 2 months and the loss in national income would be no greater than it has actually been.

There has been a large amount of discussion in the press regarding our armament program. If we had employed everybody who was working in 1929 constantly during the last 9 years, we could all stop our regular work and all the gainfully employed wage and salaried workers could go to work on armaments for a year and 2 months and the net effect on the national income would be just about the same as took place during the period from 1930 to 1938.

Representative SUMNERS. Dr. Lubin, was there a greater loss in the relative total of people who worked and the people who farmed, or any other group of that sort?

Dr. LUBIN. I am going to come to that right now, Judge Sumners. Now, what does this loss of employment mean in terms of wages and salaries?

(The chart referred to was marked "Exhibit No. 10" and appears on p. 14. The statistical data on which this chart is based are included in the appendix on p. 196.)

Dr. LUBIN. That picture is portrayed here. Assuming that the total amount of salaries and wages paid out in 1929 had remained unchanged and these losses had not occurred, the total amount that would have been paid out in dollars to our wage and salaried workers would have been $119,000,000,000 more than it actually was

The CHAIRMAN (interposing). How much?

Dr. LUBIN. $119,000,000,000. In other words, our loss during these years was 240 percent of the actual amount that was paid out in salaries and wages in 1929. That loss was 50 percent greater than the total national income paid to farmers and merchants and business men and labor and everybody else in 1929.

EXHIBIT No. 10

SALARIES & WAGES LOST IN DEPRESSION IN NON-AGRICULTURAL OCCUPATIONS

The CHAIRMAN. Let me ask it this way: What was the total national income in 1929?

Dr. LUBIN. Approximately $81,000,000,000.

The CHAIRMAN. And what is this total of the lost income?

Dr. LUBIN. One hundred and nineteen billion for wage and salaried workers alone.

The CHAIRMAN. So it is one hundred and nineteen billion compared with eighty billion, you say?

Dr. LUBIN. Eighty-one billion for everybody.

The CHAIRMAN. Eighty-one billion, the largest single year in the history of the country.

Dr. LUBIN. Exactly; and this is the loss only to wage earners and salaried workers.

Now, in terms of losses to investors, assuming again you could have maintained your 1929 level of dividends paid out, the cumulative loss is $20,100,000,000, which is three times the amount that was actually paid out in 1929, the peak year of dividend disbursements. (The chart referred to was marked "Exhibit No. 11" and appears on this page. The statistical data on which this chart is based are included in the appendix on p. 196.)

Dr. LUBIN. If we turn to the farmers, the total loss in the gross income that went to them, as compared to what they got in 1929, was thirty-eight billion four hundred millions, which is three times the amount that all the farmers got for everything they sold in the year 1929. In other words, the net loss over this period of years is equal to three times the amount they actually got in 1929.

(The chart referred to was marked "Exhibit No. 12" and appears on p. 16. The statistical data on which this chart is based are included in the appendix on p. 197.)

Representative SUMNERS. It doesn't look as though anybody is doing very well.

Dr. LUBIN. The fact is that when we talk about national income, it doesn't really mean much unless we are talking about the groups affected, and these are the three most important groups, the investors, laborers, and farmers. What I am attempting to do is to show the relative loss to each of these three groups.

The CHAIRMAN. Have you made a chart comparing the loss of each group with the other, as, for example, the loss incurred by investors as compared with the loss incurred by wage earners, as compared with the loss incurred by farmers?

Dr. LUBIN. We haven't such a chart, but I could easily add them together. We have them all.

The CHAIRMAN. It could easily be read from these charts?

Dr. LUBIN. Yes. If you add all those together, the losses to labor, the losses to agriculture, the losses to investors, assuming all the time that we could have maintained the level of 1929, it amounts to $133,000,000,000 as compared with a national income in 1929 of $81,000,000,000. Incidentally in this chart I have eliminated the effect of price changes; in other words, I am dealing now in terms of physical units of goods, eliminating such changes in the national income as arose from price changes.

(The chart referred to was marked "Exhibit No. 13" and appears on p. 17. The statistical data on which this chart is based are included in the appendix on p. 197.)

Senator BORAH. Dr. Lubin, have you the farm income or agricultural income for 1928?

Dr. LUBIN. Yes, right here, sir.

Senator BORAH. And then in 1929? The farmers were pretty nearly as bad off in 1928 as they were in 1930.