Coal is a chemical to it and not only fuel, and the fact of our being there with cheap power is bringing a new use of coal into that region. It is our business to see how we can best balance that economy so that a benefit in one line is not balanced by a loss in another. That is a part of reasonable planning, to see how benefits can come without suffering losses. Senator DICKINSON. Then, this is a part of social and economic planning to see whether or not you can bring about a balance down there that will satisfy all of the conflicting principles of society. Dr. MORGAN. Well, not necessarily satisfy all, but will operate to the mutual balance of interests between agriculture and industry, between water power and coal, and see how far we can further the normally well organized development in that region. Senator DICKINSON. Well then, they are making carbide in other sections of the United States, are they not? Dr. MORGAN. Yes. Senator DICKINSON. Where is it made? Dr. MORGAN. A good deal of it is made up at Niagara Falls. Senator DICKINSON. What is going to happen to that up there? Dr. MORGAN. It will probably continue on its present stage, but increased growth may be where the conditions are more favorable as to raw materials, Senator DICKINSON. Have you anything else you can produce down there? Dr. MORGAN. Yes. Senator DICKINSON. What else? Dr. MORGAN. For instance, in the past 2 or 3 years the electric firing of ceramics-that is, pottery and so forth-is just taking all Europe. We get a large part of our pottery imported from foreign countries and they are abandoning firing by coal and gas. They are taking on firing by electricity which is far more economical. Now, we have the best ceramic material in the world right there. We have the electric power, we have an abundance of unemployed labor of high quality. It seems that we may bring the ceramic industry to America and settle it in that region, if there is a possibility. Now, again, we have hundreds of deposits of manganese there. We are getting 90 percent of our manganese from other countries. The manganese is in little pockets. It is too small for a big mining company to go in and open the mines. We may be able to develop little manganese cooperatives with, say, a half dozen men who can work each of these little manganese deposits. If we can organize production and then bring it together at a central point for reduction, or get some company that will do it, or get these people to organize themselves and do it; one estimate is that we could employ 40,000 men in producing manganese that now comes from Russia and Brazil. There is a possibility. Senator DICKINSON. Well now, as to the pottery situation-how far will that interfere with the pottery industry of the Ohio Valley extending from below Pittsburgh down to, almost to, Cincinnati? Dr. MORGAN. Why, what I hope is that we can bring over to this country qualities of pottery that now are produced only in Europe. I think possibly that electric firing is so much more satisfactory, economical that it is just displacing gas and coal firing, so rapidly, that and Senat Dr. anot See it al Dr. the industry itself is going to find that it will have its further development in proximity to cheap power. Senator DICKINSON. You are not ready to list the earthenware industry of the Ohio Valley as one of the inefficient industries that is going to have to be abandoned? Dr. MORGAN. The process of technology will determine that. We cannot determine it. But, those people are getting very anxious now to see how they are going to compete with Europe or other regions that are going to electric firing. Senator DICKINSON. Well, why would it not be feasible to let them work out their solution of this problem? Dr. MORGAN. They are coming to us. Senator DICKINSON. They would not come to you if it were not for the fact that they fear that you are going to have the Government in this type of business down there. Dr. MORGAN. No, that is not the case at all. They are going after cheap power. They want to get where power and feldspar and kaolin and pottery clay come together and there is no place in the United States where all those things come together as they do in that region. There is where these natural elements get together. Senator HALE. In other words, they will have to move away from the Ohio Valley. Dr. MORGAN. They are going to be compelled to associate where cheap power and the raw materials of ceramics meet, and they do meet there, and they are negotiating at this time, coming to us, and asking what their chances are of getting cheap power, saying "We have got to go where the power is for further development." Senator DICKINSON. In other words, that is an indication of the abandonment of the earthenware industry in the Ohio Valley, if new conditions develop as you suggest. Dr. MORGAN. I should say if technological conditions compel abandoment of their present methods they are apt to go where cheap power and raw materials are together. Now, there are other elements. For instance, we have there in the eastern part of our region, some relatively small deposits of iron that do not have any phosphorus or sulphur in them. About the only known place in the world where you will find iron like that is in Sweden. Sweden, for the most part, requires that iron to be made up before it is shipped out of the country, made up into finished goods. We pay a very high price for it. Now, if we can encourage the opening up of some of those deposits we may make Swedish iron unnecessary in this country. Now, take another little item. There is the possibility of a cooperative for making split shingles. Eighty percent of the wooden shingles of the United States that are consumed here come from outside the United States. We tried it out a while ago, to see what we could do with these people who are on public relief, people living on these hillsides with nothing to do. They came down from Pittsburgh, and Detroit, and Chicago, when the slump came. They had gone up there to work, and when the slump came they came down and were starving together on these hillsides. We tried to see whether they could take the timber that is too small for logging and make shingles out of it, and we tried it out, and before we could stop them we had 2,000,000 shingles piled on us. We think we can, to a large extent, relieve Dr. M Tough h elimi ourselves from the importation of shingles by a cooperative that can gather these up from the farmers so that these people who are now on public relief can be making wooden shingles. The T.V.A. has not invested any money in this cooperative, but has cooperated with other, agencies. That is a part of this associated cooperative's work. Senator DICKINSON. Well, there is no industry that I know of that is any worse affected than the lumber business by this depression. Dr. MORGAN. Nevertheless, most of your shingles are coming from hi Canada-British Columbia-today, a large part of them, and I think thi we can make them here. Senator DICKINSON. Well, we have worked awfully hard to try to keep them out by putting a little tariff on them, but we have not succeeded very well. Dr. MORGAN. I think we can get people who are now on public relief to making this material we are now shipping into the country, and if this housing bill goes through, we can have a market for just such material. Senator MCKELLAR. The lumber business has improved very much. in the last year. Senator DICKINSON. In price, yes; the price has doubled, is double what it was before. Senator MCKELLAR. That is one indication. Senator DICKINSON. Now, the last paragraph of this Knoxville News Sentinel release of April 21, 1934, is as follows: Among the measures being undertaken, he said, is the education of nearly 600 of the laborers working on Norris Dam; the organization of a sweetpotato cooperative in a community where the forests are largely cut off, the chief money-making occupation is gone, and half the people are on public relief with despair and discouragement in their hearts. The cooperative, he said, will enable them to support themselves again. Now, I read somewhere, I think, in your testimony, that you were going to start a starch factory, and raise potatoes to make starch out of. Is that in your program, included in your program? Dr. MORGAN. This is what we are working on, about 80 percent of the laundry starch of this country is imported from Germany. Some of the experimental stations down there have been spending quite a bit of time in developing sweetpotato starch and they find that sweetpotatoes make better laundry starch than they are now importing into this country, and over in middle Tennessee there is a group of these cooperatives that we have been consulting with that have a great surplus of sweetpotatoes. Now, we are working on the possibility of getting some proper department of the Government to help finance them. The Tennessee Valley Authority has not built such a factory; but we may work it out so that they can be financed for building a sweetpotato starch factory, and take up the surplus of the sweetpotatoes in that region. Senator MCKELLAR. And, you say that 80 percent of the starch we now get, of that particular character, comes from abroad? Dr. MORGAN. Yes. Senator MCKELLAR. And, of course, that would be of benefit to the raisers of sweetpotatoes and the starch is just as good or better as can be obtained from abroad? Dr. te Dr. D Dr. MORGAN. Yes; we think that about six factories scattered through the South can make all of the laundry starch America needs, and eliminate the importations from abroad. Now, it is not our business to finance those things, but we are studying the possibilities. Senator DICKINSON. What is the difference between the sweetpotato starch and cornstarch? Dr. MORGAN. I do not know, technically, but I do know that cornstarch is not used for laundry starch. The starch used for laundry starch is made from potatoes. Now, I cannot tell you the chemistry of it, but there is some reason, and for some reason that is a fact. Senator HALE. What is the difference between sweetpotatoes and white potatoes, for making starch? Dr. MORGAN. I beg your pardon. Senator HALE. What is the difference between sweetpotato and white-potato starch? Dr. MORGAN. Why, I cannot tell you the chemistry of it. The chemistry is almost alike, but the laundries who have tried the starch say that they like the sweetpotato starch better than what they are now using. Senator MCKELLAR. Doctor, would it be imposing upon you to ask you to ascertain just what the difference is, as to why sweetpotatoes are more valuable for starch making, and have you put it in the hearings? I would like to know. Dr. MORGAN. I could get a statement from the laboratories. The laboratory is at Atlanta. They have been doing a large amount of work on it. I doubt if they can tell you themselves just what it is. You can try it and see that the organic chemistry is so complex. I have been working in that field somewhat. I doubt if any chemist could tell you, those who are working on it or others, just what it is. But, they try it out and find by trial. Senator DICKINSON. Who is Floyd W. Reeves in your organization? Dr. MORGAN. He is director of personnel. Senator DICKINSON. I find in the Chattanooga Daily Times, of April 24, 1934, he gives out a statement in which he says that all of the States of the Tennessee Valley area have constitutional provisions making it difficult for the State governments to operate most effectively, and as I read the account, he wants the constitutions of your various States all revamped down there and have a one-house legislature. Is the Tennessee Valley Authority-does it have anything to do with that? all. Dr. MORGAN. I do not know the expression that you refer to. Dr. MORGAN. I do not know the expression that you refer to at Senator DICKINSON. Well, I will read it to you. Senator MCKELLAR. While we are waiting for him to get the expression, that was not given out by the authority of the Tennessee Valley Authority? Dr. MORGAN. Why, I was going to ask how that was said, and to whom, and so forth. Senator DICKINSON (reading): Dr. Reeves tells group that present situation prevents efficient government. Dr. MORGAN. What group is that, please? "Something must be done to eliminate constitutional barriers to social progress in the States of the Tennessee Valley area," Floyd W. Reeves, director of personnel and head of the social and economic division of the T. V. A., said this morning in a round table discussion at the University of Chattanooga's Tennessee Valley Institute. Dr. MORGAN. There was a discussion of political scientists on the various governmental problems. He and others were discussing there in their personal capacities problems of the local governments. There was a round table there. That is, a group of people, political scientists, were together discussing matters in their personal capacities, some from the State universities, some from other States, other State officials, and they were there talking over problems themselves and expressing personal opinions. I do not think that we ought to prevent a man from belonging to a scientific organization and discussing matters with other men in his own field. Senator DICKINSON. This is what you would call, then, a group of economists gathered at a technical discussion? Dr. MORGAN. Yes. Senator DICKINSON. And this discussion was a part of that? Senator DICKINSON. Oh, there is some interesting information in there. You ought to read that, Senator. Senator McKELLAR. Yes. Senator BYRNES. How about this 30 minutes that you were going to take? Senator MCKELLAR. Well, while we are waiting on Senator Dickinson, Doctor, is there anything that you desire to say to the committee on your own account? Dr. MORGAN. I do not think so. We are endeavoring to carry out the purposes and policies of the Tennessee Valley Authority Act in spirit and in letter so far as the legislative program is concerned, which has been discussed here. We are trying to carry that out in the only way that is feasible; that is, in having a unit that is of such size and such proportion that it can be representative of a wellorganized power unit, and these things we are doing are necessary to bring that about. I would say also that so far as the development of the water power of the Tennessee River is concerned, that a single power plant on the Tennessee River, such as Muscle Shoals, is not even economically feasible. Muscle Shoals, taken by itself, is not an economically feasible unit. If it can be united with others so that reservoir projects can supply it with water in low season, we can make it at least three times as effective per dollar invested as it is today; and the same way with Norris Dam. Taken alone it is not a good investment, but taken in connection with its effects upon the other plants downstream, it becomes a very good investment. If we can carry out this project as a whole we can produce electric current at not over half what it would cost at a single plant here and there. nato Your t red at the bu nato Tent, Can Fenat TO DE na |