difficulty insofar as the bean industry itself is concerned. No cases at all involving the question have been taken into the courts by the Administrator, and only one court action has been brought by an employee. In this only controversy to reach the courts, Remington versus Shaw, decided by the United States district Court, western district, Michigan, January 12, 1942, the court fully sustained the Administrator's definition.

In any consideration of this matter, it is of importance to note that dry edible beans are received by the elevator and leave the elevator in their raw or natural state and with their form unchanged. In most parts of the United States, the beans are received in "thresher-run" condition-that is, in the same condition in which they come from the fields-but it is mandatory that the beans be cleaned and processed to the official United States or State grades before they can be entered into distributive channels for distribution for consumption.

For example, the State of Michigan, which has its own bean-grading standards and regulation, expressly provides therein that

"No dry edible beans of picking stock grade or "no established grade" will be permitted to move between plants within the State of Michigan without inspection, except for the purpose of processing to grade, and shall not be placed into trade channels for consumption until they are processed to meet the requirements of one of the established grades" (Michigan State Department of Agriculture Regulation No. 501, p. 7).

The official United States standards for beans also make it mandatory that"Beans shall be graded and designated according to the respective grade requirements of their appropriate class and according to the special grades applicable." Various factors determine the extent of the bean-producing areas in actual practice. In Bean Culture, by E. V. Hardenburg, of Cornell University, published in 1927 by the MacMillan Co., this is clearly brought out, on page 44, as follows: "Extent or geography of dry-bean production varies with such factors as rainfall, distribution, temperature, cropping system, and marketing facilities. The factor of light rainfall in the autumn accounts in part for the importance of the industry in western New York, in the "Thumb' district of Michigan and in the important bean districts of the Middle and Far Western States." And, this further factor, particularly significant here:

"Owing to the necessity of special labor-saving devices to clean and prepare the crop for market, the prospective grower must first assure himself that such facilities are available to his locality."

There is no question but that after the beans have been threshed they still are not in condition where they can be shipped out of the area of production, nor will they be accepted by the consumer. With any substantial quantity of beans, it is impossible for the farmer to put them into the condition which consumers demand; with any quantity at all, it is both impractical and uneconomical. Hence, since beans became of any importance commercially, it has been the established custom for the elevators to buy the farmers' beans on the basis of the condition in which they will be compelled to place them for the consumer, and to chearge the cost of placing them in this condition to the farmer himself by making a deduction from the price paid to him for the beans in their thresher-run condition. In other words, this is an essential step in preparing the beans for the market, which the farmer cannot, as a practical matter, otherwise reach. As he cannot perform this operation himself, he merely pays others to do it for him. It was for the foregoing reason, that the Committee on Ways and Means of the United States House of Representatives (Rpt. No. 728, 76th Cong., 1st sess., accompanying H. R. 6635, Social Security Act amendments of 1939) specifically referred to and exempted the cleaning of beans as “agricultural labor" on the ground that "such services are an integral part of farming activities."

In view of this situation, which finds its direct counterpart in the Administrator's definition of "area of production" relating to dry edible beans, it is clear, we submit, that the processing of the beans to the grades required for marketing in their raw or natural state is an essential prerequisite to the farmer's crop having any market at all in the present day and age. No elevator buys the beans for its own use, and could not possibly be considered as the market for which the farmer must, of necessity, prepare his crop. Furthermore, he certainly is not growing the beans for his own use, but for market, and as an integral part of his preparation of the crop for the consumptive market which it is designed to reach, the processing, including hand-picking, grading, drying, etc., must of necessity, both practically and legally, be performed within the actual "area of production."

Under normal conditions, the dry edible bean crop returns to the farmers of the United States an average exceeding $50,000,000 annually. The acreage

planted will range from 1,500,000 to 2,000.000 acres, and on this area from 12,000,000 to 15,000,000 bags of beans are produced each year.

The leading type is the white navy or pea bean, 90 percent produced in Michigan, and most of the remainder in New York State. This type comprises on the average one-third of all beans. The Great Northern bean, a comparative newcomer, is a large white bean competing with the navy bean in the retail grocery trade, and since 1928 has represented on the average 13 percent of the total supply of all edible beans. These are produced in concentrated areas in southern Idaho, south central Montana, northwestern and central Wyoming, and western Nebraska.

Other principal types of beans are the small whites and limas from California, marrows from New York State, pintos from Colorado and New Mexico, pinks from California, small reds from southern Idaho and California, and red kidneys from Michigan and New York State, and cranberries from California and Michigan.

It has always been the settled practice in the bean industry to make a deduetion for processing the beans, from the amount paid to the farmer for them. By the very nature of the commodity itself, as well as the manner in which the farmer sells his beans to the elevator, this is absolutely essential.

The reason for this deduction from the farm price is very apparent. As heretofore stated, the beans are delivered by the grower in thresher-run condition and of varying grades. If they were of equal quality, it might be argued that the processing cost could be passed on to the consumer, but with each lot of the beans of a different grade and carrying, as they do, a uniform base price. it is necessary for the grower to take a corresponding deduction to bring the lower grades to that uniform level for marketing. This is an entirely different situation from that involved in production of a manufactured article.

In hand-packing the beans to grade, the same amount per pound deducted from the farmer for this operation is paid to the bean pickers. The elevators historically operate on an exceedingly small margin of profit, and could not survive if they were required to absorb the charge. In the ordinary free market. with the law of supply and demand dictating the price which the consumer will pay, it is equally impossible to pass the charge along to him.

The only alternative, therefore, which removal of the present exemption would bring about, would be to increase further the deduction of the amount paid to the grower. It is not believed that such a solution is the purpose or intention of the Congress. As stated by Congressman Biermann of Iowa, at the time he introduced the amendment which became section 13 (a) (10):

"The amendment I have offered includes only the first processing of things that come off the farm. The important point is that the farmer pays the bill for this processing.

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"The Members from the South will agree that the man who raises the cotton pays for ginning the cotton. when the cost of ginning the cotton increases the farmer gets just so much less; and our contention and the contention of the farm organizations is that this bill designed to help labor should not be so worded that it puts another burden on the agriculture of this country." (Congressional Record, May 24, 1938, pp. 9741, 9742.)

Furthermore, the basic intent of Congress in its enactment of the Fair Labor Standards Act was, as shown by its preamble, to eliminate certain “labor conditions detrimental to the maintenance of the minimum standards of living necessary for health, efficiency, and general well-being of workers." Such conditions, it is declared, should be eliminated as they constitute an unfair method of competition, lead to labor disputes, spread such undesirable labor conditions among the workers of the several States, and interfere with the orderly and fair marketing of goods in commerce between the States.

But Congress declares it to be the further policy of the act, to eliminate such undesirable labor conditions without substantially curtailing employment or earning power.

In the first place, the evidence in the hearings before the Wage-Hour Administrator is clear that the conditions which the Congress sought to correct by the enactment of this legislation do not even exist among the bean elevator employees. The record is replete with testimony that many of the bean pickers own their own homes, have put their children through college, work when and as they choose, coming and going at will, that the same individuals work at the elevators year after year and the labor turn-over is negligible, that many of the bean pickers are wives, daughters, and relatives of the farmers living

in the immediate neighborhood, and the amount they earn in many instances supplements rather than constitutes the sole family income, that so-called sweat-shop conditions do not even exist in this industry, that labor employed in the bean elevators is satisfied and labor disputes are practically unknown. Hence, the very conditions which the act sought to eliminate are not only nonexistent among the employees of bean elevators engaged in the hand-picking of beans, but the evidence is also clear that forcing them to maintain the basis essential for payment of the minimum wages over the maximum period of hours permitted, will force upon such employees the exact conditions which the act endeavors to abolish. And, not only that such will be the case, but that this must of necessity be accompanied by a very substantial curtailment of employment, efficiency, and well-being of such workers.

We, therefore, respectfully urge the committee that it recommend the retention of the "area of production" exemption as it now appears in section 13 (a) (10) of the Fair Labor Standards Act. It is only by this means that recognition can be given to the actualities of processing farm commodities, such as dry edible beaus, into the finished farm product required for entry into the consumptive trade channels. The statutory provision is fair, reasonable, and administratively workable, as shown by its successful application for nearly 7 years in the dry edible bean industry, and its elimination would only be detrimental, we firmly believe, to the farmers, elevator operators, and employees alike.

(The following testimony was presented for the record by witnesses of the International Union of Mine, Mill, and Smelter Workers, CIO, who because of the limitations of time were unable to appear before the committee :)

TESTIMONY AND DEPOSITION OF WALTER WHITE, EMPLOYEE OF ROYSTER GUANO Co., MACON, GA.

My name is Walter White. I live in Macon, Ga. I came to Washington, D. C., with a delegation of representative workers from my community to bring to the attention of our Congress the absolute necessity of establishing a minimum wage level which is consistent with our desire to have a decent American standard of living.

First, let me give some examples of wages being earned in my area. I brought with me pay vouchers of several of the companies in my community. From the Royster Guano Co. where I work I have pay vouchers which show take-home pay in six cases for the following amounts: $22.26, $21.48, $18.59, $23.42, $14.16, and $21.48. This is for a full week's work and, in many cases, is even more than 40 hours' work. These amounts represent the earnings of men with families with anywhere from two to seven children. We have just been able to negotiate a new rate in the plant, and the hiring rate is now 55 cents per hour. Out of 62 work classifications 1 person is being paid 72% cents: 4, 70 cents per hour; 4, 65 cents; 24, 60 cents; and 29, 55 cents per hour. This, of course, includes the lowest, as well as the highest, skilled in the plant.

Again, in the Massey Gin & Machine Co., a foundry in my area, an example of several of the earned take-home pay vouchers shows the following: $22.87, $15.32, $19.95, and two more at $19.95. The common labor rate is 50 cents per hour. The highest skilled men in this plant, moulders, etc., are making only 70 cents to 75 cents per hour because of the low common labor rate. As in the case of Royster Guano, these are earned checks of married men with large families. Another example-Burns Brick Co., which is located in my area-shows the following five examples of take-home pay: $14.47 for 40 hours; $14.05 for 42 hours;

$19.92 for 44 hours; $17.46 for 424 hours; $21.36 for 421⁄2 hours. I have check vouchers with me to prove that the rates on the sample checks which I have just mentioned above show rates running at 33 cents per hour; 34 cents per hour; 42 cents per hour, and 50 cents per hour, which is even below the minimum wageand-hour law.

Finally, other examples of a plant in my area-Cherokee Brick Co.-shows examples of take-home pay in the following amounts: $12.57, $17.62, $16.64, $16.08, and $12.55. The hiring rate in this plant is 45 cents per hour. Even moulders and kiln repairmen, who are considered fairly skilled, are getting only 45 to 50 cents per hour. Again, these are checks of family men with average dependents of from four to five in their families.

This is only one side of the story. Most people say that living costs in the South are much cheaper than in the large industrial areas where wages are higher. I would like to show that my experiences and those of the people who work with me are quite different from what everyone believes to be on the question of living costs where I come from.

In the first place, going to and from work we take the public conveyances, and that means 20 cents per day carfare, which is the same in any large city, and also means $1 or $1.20 per week out of our very small earnings. Our cigarettes, one of our few luxuries, cost us 20 to 22 cents per pack. Here are some of our food items: Round steak in my community is 37 cents per pound. I have just checked in Washington at a large market and the price for double A grade is 40 cents per pound. Here are some of the other prices of our meats: Center cut pork, 39 cents; pork shoulder steak, 35 cents; B grade beef loin boneless, 44 cents; bone end steak, 35 cents; round steak, 37 cents; T-bone, 44 cents. These prices are not very much cheaper than what is being paid anywhere else for these meats.

Our grade A eggs (large) are 67 cents, the same as ceiling prices here in the East. Our medium eggs are 61 cents; our small, 51 cents-exactly the same as the prices here. Our butter costs us 51 cents per pound. Creamery butter advertised in the paper I read in Washington is only 49 cents per pound. Our margarine is 23 to 27 cents; here in the East it is 25 cents. Table-dressed chicken costs us 62 cents per pound in Macon. The markets here in Washington are advertising the same quality chickens for 41 cents per pound. Milk is 14 cents a quart, the same as in the East.

Perhaps you will ask how we can buy these items with the wages we make. We can't!

Clothing is higher than even in the large industrial areas. Work shirts for which we paid 98 cents before the war are now $1.98. Dress shirts for which we paid $1.50 are now $2.75. Our shoes run 30 percent higher. We used to be able to get men's shorts for 25 cents; now the cheapest we can get them is $1. The same is true of clothes for our women and children.

Decent housing-whenever we can get it-is just as bad. There are some Government housing projects, and if you are lucky enough to get into them, you have a decent place to live. But if you earn about $100 per month the rent still costs you $30 per month. A good many of us are forced to live in alley shacks and other similar places where the rent for a three-room place that is dilapidated is $10 per month. When it rains you have to move out. In addition, we have to pay for water and electricity, if you are fortunate enough to have it. Otherwise we do all our cooking and heating with coal and wood stoves, and this boosts our rent.

This shows a comparison between what we make and what it would cost us to be able to live decently. Actually we can't. We are forced to take our children out of school to put them to work and also to put our wives to work so that we may be able to keep our families together. Many of our sons have willingly and ably fought in this war to protect our country. We feel that we are entitled to te able to live like every American family wants to live-in a good home with electricity and heat, good food, and decent clothing. We want to impress upon Congress the need for establishing at least a 65-cent-per-hour minimum wage that will at least help us a little along the road toward securing just that.