Mr. MULTER. Mr. Goodman, I am addressing you, because you were answering Mr. Cole's questions rather than Mr. Green.

Regardless of how many hours it takes that employee to earn that dollar today, when he gets that dollar, he can use that same dollar to buy either private housing or rental housing or cooperative housing. Is that not right?

Mr. GOODMAN. Yes.

Mr. MULTER. This bill will not make him work 1 hour longer to get his dollar, if we can make the means available for him to put that dollar into housing.

Mr. GOODMAN. That is right.

Mr. MULTER. I recall also that it was not so long ago that we heard a great deal of talk from a large vocal group in this country that the way to beat inflation was to increase production.

Mr. GOODMAN. Correct.

Mr. MULTER. This is a method of increasing production without increasing cost; is that not so?

Mr. GOODMAN. That is correct.

Mr. MULTER. According to what this bill is intended to accomplish. Mr. GOODMAN. We believe it will reduce costs.

Mr. MULTER. Even if it does not reduce costs, it certainly will increase production without any increased cost; is that not so? Mr. GOODMAN. That is right.

Mr. MULTER. So, we have an additional benefit to gain, if in addition to that we can also reduce the cost.

Mr. GOODMAN. Yes, sir.

Mr. DEANE. Mr. Chairman

The CHAIRMAN. Mr. Deane.

Mr. DEANE. I would like to point out that in the consideration of this legislation we should not lose sight of the fact that the proposed housing we are considering is in the interest of human beings.

Mr. GOODMAN. I would like to say first off, picking up the point of discussion with Congressman Cole, that we believe that one of the impacts would help reduce the inflationary factors existing in the present housing field by establishing a yardstick.

Those of you who come from the TVA area know how important the establishment of a yardstick is. It brought down the cost of electricity to the residents in your area. We believe this program will do the same in the housing field generally and will expand housing production in the United States.

Last year we produced approximately 1,000,000 units. This bill will help boost the annual producetion rate, with all of the beneficial effects that will flow from that, closer to the million and a half that the Council of Economic Advisers recently stated were essential to begin to meet our housing needs.

Those two aspects, a deflationary effect in the major cost of housing plus an increase in production, is exactly what many of the large business interests in this country were saying is most essential to begin to meet our housing needs.

This bill will aid both of those factors.

Mr. DEANE. One other question, Mr. Chairman.

What do you think would be the general, universal interest in this legislation that we are enacting? I am thinking now of the smaller

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rural or urban areas of the country. What reception do you think it would receive or have you made a study of those areas to determine whether or not a cooperative could be wisely set up and operated?

Mr. GOODMAN. I would like to call Congressman's attention to a recent book on co-op housing published by Elsie Dannenberg, which pointed out that the major interest in cooperative housing was in small towns and rural America.

Our own experience has been that member unions in the smaller towns throughout the country have been most anxious to try to get a program started along the lines proposed in this bill.

In Mr. Green's statement, he pointed out the fact that the rubber workers have just finished a project in Mishawaka, Ind., a small town. There is a group from Coatesville, Pa., in today trying to get a program started-a very small town.

We believe a program such as this one would provide the first real relief for mine workers who live in rural America and who are unable in their present circumstance to get adequate housing, and the same will be true for other groups in small towns in rural America. Mr. DEANE. One other question that I think of, Mr. Chairman. As you know, throughout many aras of the country and especially in the textile areas of the South, mills are selling the mill homes. In many cases they are finding it difficult to process the applications through FHA.

It is generally felt that perhaps this legislation will provide a suitable vehicle to carry out some of these transfers. You think that this would help management and their employees in their effort to move forward in that the employees might own their own homes.

Mr. GOODMAN. Mr. Green pointed out in his earlier statement that in periods of plant expansion the Celanese Corp. in Front Royal, Va., for example, was aided by the initiation of a cooperative housing project by the textile workers' union. They were able to carry out this expansion only because this project provided the additional housing that was necessary in the community to bring those workers in. The same would be true where management is trying to sell off company housing and the workers are either anxious to buy or build new and more adequate housing in the present scene.

This bill would certainly be of benefit to those plants in the solving of the housing problem of its employees.

Mr. DEANE. That is all, Mr. Chairman.

The CHAIRMAN. Any further questions?

Mr. MITCHELL. Yes, Mr. Chairman, please.

Mr. Green or Mr. Goodman, you mentioned Mr. Thompson in your statement, Mr. Green; and when he was before the committee he gave the committee the results of a survey, in which he listed the towns in which they were building houses at $8,000 or under.

I have just counted the number of towns listed in what he calls the colder areas of the country, which presumably are the higher-cost construction areas of the country.

In the towns with homes listed at $8,000 or under, he names 283 towns; in the list in which he says there are houses being constructed at $6,500 or less, he names 192 towns. He was questioned during his testimony as to the number of houses being built at these prices and he did not have that figure.

The inference therefore is that there are possibly one or two houses in this cost category being built.

I am wondering whether you can give the committee information as to whether any large number of houses are now being built across the country in these 283 towns in the colder areas of the country meeting the needs in this middle-income group as an $8,000 house wouldI think we will concede that.

Mr. GREEN. Congressman, I do not have any figures. I suppose perhaps we could dig them up; but, if Mr. Thompson said they are building homes for about 6,500 across the country, I am afraid they are not homes but they are more like cheese boxes, because I saw some of the homes close to $10,000 and the materials and what-have-you going into them are inferior.

Mr. MITCHELL. And there are still a good many people rushing to buy those houses which are actually inferior houses.

Mr. GREEN. It is the best they can get, sir.

Mr. MITCHELL. If you do have any information which would show the number of $6,500 to $8,000 houses being built, I think the committee would like to have it.

Mr. GREEN. Mr. Goodman says we will check the list and supply whatever information we have.

Mr. MITCHELL. I would like to look a little bit, too, at the obverse side of the coin that Mr. Cole was examining. You mentioned the 608 projects. I think Mr. Goodman mentioned them. There will be a slow-down in the 1608 project construction this year.

One witness before the committee quoted a newspaper article saying that probably only 800,000 homes would be built in 1950. So, I would like to look at the picture from the deflationary point of view. If we do drop off from the 1,019,000 homes which were said to have been built in 1949 to 800,000 homes in 1950, what will be the deflationary effect on our economy?

Mr. GREEN. No. 1 will be unemployment without a doubt. Unemployment in any industry has its effect on other industries. As to just what amount of deflation will take place, I am in no position to say at the moment.

Mr. MITCHELL. Would you state your opinion here as to whether there is a greater degree of danger facing us from the deflationary effect if we do not pass this bill than there is facing us from an inflationary effect if we do pass it?

Mr. GREEN. Well, as far as I am concerned, I think the bill will do the job that is necessary to keep us balanced.

We must keep away from deflation, because it is as much to be avoided as inflation, but the way I feel about it is this: Every time we come here asking for help for the fellow who can't help himself, we are told that it is inflationary.

Mr. MITCHELL. And socialistic.

Mr. GREEN. Of course, everybody is a Socialist today. I don't know; maybe I am crazy, but I thought the principle upon which America was built was to help people to help themselves, and I think we have been carrying out that principle in our aid to Europe. Strange as it may seem, there seems to be a joint opinion of the political parties in helping Europe, but to come here and try to help ourselves is called inflationary. It just doesn't jibe.

Mr. MITCHELL. Thank you.

Mr. O'HARA. Mr. Chairman-

The CHAIRMAN. Mr. O'Hara. We have another witness this morning.

Mr. O'HARA. Mr. Green, long ago I learned that the opinions of men are not always those which spring from the operation of the thinking processes, but too often are influenced by their interest and their associations. As a new member of this committee, I have been evaluating the testimony of witnesses by the associations and the interest of the witnesses.

In evaluating your testimony and in comparing it with the testimony of bankers and mortgage men who were here, men who were comfortably cushioned on the status quo, I took that into consideration. Now I wish to evaluate your testimony.

What percentage of the members of CIO are in the middle-income group, would you say?

Mr. GREEN. An overwhelming majority. I would say about 65 or perhaps 70 percent, because most of them come in the mechanic class. Mr. O'HARA. So you have an interest in the welfare of this 65 percent of the membership of CIO in the middle-income group and you wish to provide them with proper decent housing within their

means to own or to rent.

Mr. GREEN. That is right.

Mr. O'HARA. Now, these men, the members of the CIO, work for private industry, do they not?

Mr. GREEN. Mostly.

Mr. O'HARA. And you have, as the representative and leader of those workers, a real interest in the welfare of the employers who are paying them wages. That is true, is it not?

Mr. GREEN. Yes.

Mr. O'HARA. So, you have no more interest in a system of socialism that would destroy private industry than has management. That is right; is it not?

Mr. GREEN. That is correct, sir.

Mr. O'HARA. Then, having in mind your sole interest is to get housing for your members who are in the middle-income group, within their means to own or to rent, so that they not only can live in the comfort they are entitled to enjoy but also can be better workers and contribut more to private industry-with that in mind you have made a careful study of the housing problem; is that right?

Mr. GREEN. I think I have, in my limited way.

Mr. O'HARA. Just one other question. Having made that study and having that interest, do you know of any better approach to the problem of providing housing to those in the middle-income group than is offered by this bill that we are now considering?

Mr. GREEN. The bill does the trick.

Mr. O'HARA. And you know of no other solution of the problem? Mr. GREEN. I have not run up against it yet, because back in June, 1941, I wrote some articles entitled "Labor Looks to the Future" on this question of no man's land in housing. At that time we were speaking then of this same group that you are making provisions for to take care of in this bill.

Mr. O'HARA. Thank you, sir.

The CHAIRMAN. Thank you. You may stand aside, Mr. Green. We are glad to have your views, and they will be considered.

We will now hear from Mr. Lincoln. We know of his fine reputation as an organizer of successful cooperatives, and we are very glad to have his views on the subject.

Mr. LINCOLN. Thank you, Mr. Chairman.

STATEMENT OF MURRAY D. LINCOLN, PRESIDENT, COOPERATIVE LEAGUE OF THE UNITED STATES OF AMERICA, ACCOMPANIED BY MR. BRYANT AND MR. CAMPBELL

Mr. LINCOLN. My name is Murray D. Lincoln, of Columbus, Ohio. I am president of three Farm Bureau insurance companies. These companies are the Farm Bureau Mutual Automobile Insurance Co., the Farm Bureau Mutual Fire Co., and the Farm Bureau Life Insurance Co. These companies serve over a million policyholders in the eastern United States. The Farm Bureau Mutual Automobile Insurance Co. had its beginning in 1926 with $10,000 capital which was invested by the farmers of Ohio. Today our mutual assets are $75,000,000 with surplus of $15,000,000.

We reduced the price of automobile insurance from 4 to 6 percent when we first started under what the majority of them still quote.

Our cooperative business was equal to $50,000,000-that is, feed, fertilizer, petroleum, and everything else.

I want to quote these things, Mr. Chairman, because every time we talk something like this, why, this question of socialism or communism does come up. I think it might be well for Members of Congress to actually get a definition of socialism, communism, and cooperation. I don't know if anybody has ever written it into the record, but, as I see it, the cooperative, in view of some of the testimony that has been presented, I think it is important.

You start with the people, and you want to do something, and the people go direct and do it. In socialism or communism, the people are here. You go through the government and the government does it, whether you like it or not.

To me that is a simple explanation, and to me there is no evidence of any sort or shape that a cooperative in any way has anything to do with either socialism or communism.

Mr. MULTER. Before you leave that, the nomenclature is changing. Instead of socialism they are now yelling "welfare state."

Mr. LINCOLN. I think you ought to read what Governor Dewey said on page 2 of the New York Times. It is very interesting. He has apparently adopted it. He says it is a pretty good thing and says he doesn't know why the Republicans ever objected to it. I just happened to read that before I came into the hearing.

We are vitally interested in this middle-income housing bill for a number of reasons. We are interested in sound investments where our funds are protected. If we invest money in a cooperative business venture, it must have as great a chance for success as any other type of business venture. On a broader scale, it has been pointed out that there are about 8,000,000 families in the middle-income group. A substantial portion of these families need homes adequate in size and at a price which they can afford. This is a vast potential market for business. As organizations which have long been interested in coop