to make because of data limitations and the subjective nature of the process. Where data is insufficient, the Council should not impute either costs or benefits as a basis for decision-making. Using unsubstantiated assumptions and then quantifying these assumptions does not provide a basis for unbiased decisions about inflation.

Whether dealing with shoe imports or color television imports, the Council takes a doctrinaire opposition to any trade restrictions, using simple-minded economic slogans on costs and benefits. Never once does the Council deal with the social value of jobs in a diversified economy. In challenging color TV import controls, the Council stated: firm estimates of domestic demand, supply, and import demand elasticities for color television, we adopted a long-run elasticity estimate." This estimate was made by a private citizen for manufacturing in general, and not this particular industry. This is ridiculous.

"Lacking

We are very much concerned about the actions and attitudes of the Council which intrudes on with free collective bargaining.

Contract settle

ments and even negotiations are evaluated and criticized from the Council. The Steelworkers and the Auto Workers have particular reason to complain about the outrageous pro-business, anti-union bias of the Council.

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To analyze wages in the steel industry the steel industry

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the Council

even before labor and management sat down for negotiations used figures from the steel industry management organization, the American Iron and Steel Industry. By using this biased source of information, the Council destroyed its own credibility. It played to anti-union editorial writers rather than serving as an impartial government agency.

The Steelworkers' union reviewed a draft of the Council's report and urged it to not issue the report because of numerous errors of fact and the biased data source. The union warned that the report was "a crass and unwarranted attempt to interfere with forthcoming negotiations" by suggesting that union "members earn too much and do not need and should not attempt to negotiate an appropriate wage increase."

In spite of the report's shortcomings and bias, the Council

went ahead and issued the report.

The Auto Workers' union has also attacked the Council for errors and wrong conclusions in its report on the 1976 auto settlements. The union pointed out that the Council report uses questionable estimates with overstatement of costs, wrongly "double-counts' the new reduced work-time plan, and wrongly suggests that higher labor costs will result in more auto imports.

The Council's report was leaked to the press before the UAW

was given the courtesy to comment.

Obviously, the Council did not care what errors might be corrected or conclusions might be modified in light of comments from the union.

We cannot avoid the conclusion that the Council is a willing tool for business in efforts to hold down wage increases. On this basis, if for no other reason, we renew our call for abolition of the Council on Wage and Price Stability.

We are happy to note that President Carter rejects wage and price control. We oppose direct controls and indirect controls, be it jawboning or guidelines or guideposts or pre-notification requirements or any other backdoor approach to controls.

The controls imposed by President Nixon proved that, it was easy to control wages, but difficult, if not impossible, to control prices. Every employer became the enforcer of wage controls, but consumers could not enforce price controls and government did not have the mechanism for such control.

The experience with wage and price controls abroad further indicate the myth of controls. In Canada, prices are rising faster under controls than they are in the U.S., but Canadian wages are being effectively controlled. England suffers double-digit inflation in spite of a controls or incomes policy. Government price-setting or wage-setting is no substitute for the market-setting of prices and wages.

We oppose any plan or program which opens the door to unfair restrictions and limitations on the wages and salaries of working people. All of these so-called anti-inflation programs, no matter how much they were gilded with the rhetoric of equity, ended up as government campaigns to hold down the wages and salaries of working people

period.

Mr. Chairman, we believe the Council on Wage and Price Stability should be abolished. We urge you to reject any extension of the life of the Council and to reject any strengthening of the Council's authority.

However, if there is a need for continuing review of inflationary pressures, we urge you to fold the functions of the Council on Wage and Price Stability into the Council of Economic Advisers. This merger would coordinate and improve economic analysis. The two Councils have related purposes and functions and, therefore, it makes sense to put them together. Furthermore, this merger would build up in the Council of Economic Advisers a capacity for comprehensive economic planning as proposed in the HumphreyHawkins Full Employment and Balanced Growth bill. Such comprehensive economic planning is long overdue, and should logically take place within the Council of Economic Advisers.

The potential for mischief caused by separate Councils can be seen in a June 14 report of the Council on Wage and Price Stability, which warns that a Carter Administration proposal for tax credits to encourage home insulation would raise prices of fiberglass home insulation material.

The AFL-CIO supports the proposal for tax credits to encourage home insulation, and we find it hard to understand why the views of the Council on Wage and Price Stability or more accurately the views of

one economist at the Council

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should carry equal weight with the views of the Carter Administration's energy and economic policy experts.

As I stated earlier, we believe the Council on Wage and Price Stability should be abolished. But, if this alternative is ruled out, we want the Council folded into the Council of Economic Advisers.

Mr. Chairman, we appreciate this opportunity to present the views

COMMENTS OF THE AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATIONS ON THE STATEMENT BY THE COUNCIL ON WAGE AND PRICE STABILITY ON THE PROPOSED OSHA STANDARD ON COTTON DUST, JULY 12, 1977 The statement presented by the Council on Wage and Price Stability dealing with the proposed OSHA standard on cotton dust should receive no serious consideration in the record of the rulemaking, by reason of incompetence.

Created by the Act of 1974, the Council on Wage and Price Stability is directed to monitor the inflationary impact on the nation's economy created by both private and public sector activities, and to report its findings.

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In carrying out its responsibilities under Section 3(a) of the 1974 Act, the Council in evaluating public sector activities has the responsibility, among other things to ". . . review and appraise the various programs, policies, and activities of the departments and agencies of the United States for the purpose of determining the extent to which these programs are contributing to inflation

Under Executive Orders 11821 and 11049, and OMB Circular A-107, each federal agency is required to provide for each major rulemaking: an analysis of principal and, if possible, secondary costs, or other inflationary effects of the rulemaking; a benefit to cost comparison, and a review of alternatives to the proposed rulemaking as to its costs and benefits-comparing them to those of the proposed rulemaking.

In addressing its comments on that part of the Inflationary Impact Statement developed by the Occupational Safety and Health Administration estimating costs of compliance the Council writes: "The Council is unable to judge the reasonableness of these estimates since it lacks the necessary technological and engineering expertise."

Since the Council by its own admission cannot judge the validity of the OSHA Inflationary Impact Statement on costs to management for compliance with the cotton dust standard, a decent regard for its own reputation, such as it is, should have prompted the Council not to file any statement whatsoever.

Instead, the Council on Wage and Price Stability (COWPS) makes matters worse by many useless and wrong-headed utterances on the OSHA Inflationary Impact Statement which it admits it cannot adequately judge. The COWPS statement sums up the estimated benefits accruing from the standard and dismissed by this scornful conclusion: "The reduction in byssinosis prevalence appears to be the only significant benefit of a cotton dust standard." (P. 13) What else? Shine your shoes? Pay off the National Debt?

COWPS's lack of understanding of workmens' compensation as an adjunct to and as affected by the enforcement of an occupational safety and health hazard, shines through its treatment of this subject with the same lustre as its costs and benefits.

COWPS challenges OSHA's comments on inclusion of reduced workmens' compensation as a benefit created by reduced prevalence of byssinosis. It states (P. 14) "Such inclusion is a common mistake in this type of analysis. . ." Such payments are simply transfers from one group to another while the real benefit is the decline of byssinosis prevalence."

Nobody would deny that reducing incidence of byssinosis is the primary aim of the standard and its most important accomplishment. However, the error lies in the COWPS statement that reduction of workmens' compensation payments is not an additional benefit stemming from an effective occupational health standard.

To the extent that employer's premiums based on experience rating are reduced and this is particularly true of self-insurers-the savings are retained by the firm, even if the workmens' compensation fund of a state pays out fewer workmens' compensation awards.

Further, reduction of absenteeism from occupational illnesses or injuries, is a money gain to management in terms of more stabilized production.

Finally, the gains to the uninterrupted earning ability of workers protected from occupational injury or illness by the OSHA standard is also capable of being computed quantitively as a benefit.

COWPS demonstrates its lack of comprehension of the OSHA Act itself in the area of standards dealing with toxic substances (Section 6(b) (5).

It erroneously assumes that OSHA derives its standards primarily on economic considerations, instead of the overriding statutory priority of worker health

and safety. From this faulty premise COWPS leaps to the equally faulty conclusion that since OSHA places "some limit to the costs industry can bear before its existence is threatened and OSHA stops at that limit (or some earlier one), then it is a recognized scientific principle that more employees can be protected by a standard based on cost-effectiveness principles than one not based on costeffectiveness grounds." (P. 8)

If there is any "recognized scientific principle" in relating costs to benefits in the field of occupational safety and health standards, it is that there is none. The difficulty, which COWPS is apparently unable or unwilling to comprehend is that nobody has bothered to calculate, for example, the costs to families losing their breadwinners by reason of occupational illness, or the costs to a worker of spending the remainder of his years on a breathing machine.

Thus, OSHA has testified in the cotton dust rulemaking proceedings that the substantive provisions of the standard to protect the worker against the hazard will not be diluted because of any real or alleged considerations of economic or inflationary impact. In establishing the effective date for compliance, however, economics would be considered in the standards implementation-for example, time periods over which the standard is to be achieved. In other words, the criteria is not what industry says it can afford, but a standard set at the lowest level feasible to protect the safety and health of workers.

The culminating absurdity of the COWPS cotton dust statement is its proposal to substitute a system of levying fines on employers for each new case of byssinosis discovered and reported, with a special OSHA flying squad deployed to monitor employees' health, rather than workplace conditions in 7,000 workplaces with 300,000 workers which have received 147 OSHA inspections over fiscal years 1973-75 and the first three quarters of 1976.

COWPS lacks any qualified health expertise and is not mandated by the 1974 Act to comment on health aspects per se of a standard. Undeterred by either deficiency, it proceeds to do so gratuitously. In fact, COWPS rests the major part of its alternative proposal to the OSHA cotton dust standard on its own grotesque interpretation of the heart of the dilemma respecting cotton dust. "The problem (so reads he COWPS' comments) is not that there is too much cotton dust; the problem is that there is too much by ssinosis." This is like saying that the problem is not too many anopheles mosquitoes; the problem is that there is too much malaria.

The findings of 24 studies covering cotton workers in 5 western European countries and the United States, and summarized in the OSHA standard publication, have all revealed consistent correlation between exposure to cotton dust and byssinosis. It could be summed up by the conclusion of a 1977 study of chronic respiratory disease in U. S. cotton textile workers by the most eminent authority on the subject, Dr. Arend Bouhuys, that:

". . . loss of lung function in textile workers is associated with, and most likely caused by, their exposure to cotton dust at work . . . Our findings indicate that cotton dust exposure in textile mills is an important cause of lung function loss, or respiratory symptoms, and of disability."

The Bouhuys' study also concluded that lung function loss "occurs among those industry jobs and not among people in other jobs in the same mills."

Finally, a NIOSH review of a study of nearly 3,000 textile workers, plus more than 900 control subjects, conducted by the Duke University Medical Center and the North Carolina State Board of Health found that "Dose-response curves for the association between dust level and byssinosis prevalence and lung function loss are strikingly linear." This means that the higher the dust level, the higher the frequency of byssinosis, of lung function loss, respiratory symptoms and disability.

Once it has made the remarkable discovery that the problem is not cotton dust but byssinosis, COWPS proceeds to add a simple, money-saving enforcement alternative proposal which it was apparently able in a short time to develop as a replacement to the science of industrial hygiene as the major means of protecting workers from occupational health hazards.

COWPS proposes that the cotton dust standard ". . . could simply specify the required results of a medical surveillance system. Such a system would be workable because the early stages of byssinosis are detectable and reversible. For every new case of byssinosis discovered, the firm could be fined according to some reasonable standard based on the 'gravity of the violation'." (P. 31)

Assurance is given by COWPS that such a system of fines would stimulate employers to undertake innovation, technology and research aimed toward re

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