Mr. HINES. I do not think that is literally true. I think there must be some medium in between the soda-fountain job and the highly technical or highly paid job that he has been doing that he might qualify for, but I do not think that we can depend upon just ordinary figures as to the number unemployed or the number of jobs available because it does not mean anything. It does not reflect anything. I think the best criterion is to look at your unemployment-compensation figures and find out if there is an increase of people drawing unemployment compensation. If there is, then that is a pretty safe criterion that there is a certain increase in people unemployed through no fault of their own.

Mr. BARDEN. You know, that is what is disturbing me. I happen to know of one State where they are using right now thousands of German prisoners, which I do not like, but the work must be done, and there are three jobs for every man who would apply for one, and yet in that same State they are carrying a tremendous load of unemployment compensation. That is a situation that is rather difficult for me to explain. I think somebody must find the answer.

Mr. HINES. Again, Mr. Congressman, let me say that I do not have access to the facts. Most States-in fact, I would say all States-are very stringent in their application of the rule set up that a worker must take suitable employment, and I know that in New York State and in Pennsylvania they have gone away beyond the definition of suitable employment that existed before the war.

Mr. BARDEN. Has that not been partly due to the fact that the Federal Government was administering one end of it and the States the other, and they could not harmonize?

Mr. HINES. NO; I do not think that that had anything to do with it at all. The Federal Government has been administering it, whether or not the State theoretically has been doing it.

Let me say that I was Secretary of Labor in Pennsylvania for 4 years, and I theoretically administered the Unemployment Compensation Act of Pennsylvania. Actually the Federal Government administered it. They set up the rules and regulations which I had to adhere to, and that is true all the way down the line. I will give you an instance of that.

Mr. BARDEN. Did you like that?

Mr. HINES. Well, that is another question. But I will give you an instance of how complete the control of the Federal Government was. In the early stages of the war they stepped into New York State, for instance, in western New York, and the War Manpower Commission representative said, in effect-I am not going to attempt to quote himthat people applying for unemployment compensation must take these particular jobs, notwithstanding anything the law said, and they had to take those jobs. That was the Federal Government telling the State administrator that notwithstanding his own laws, they had to take the jobs that were designated by the Federal Government. They took them or else, and the "or else" was that they would not get any money with which to administer the law.

Mr. RAMSPECK. Mr. Hines, Mr. Hook made a statement just now that when we passed this act we put a floor of 40 cents an hour under wages. Actually, the act started at 25 cents, did it not?

Mr. HINES. That is right, and worked up to 40.

Mr. RAMSPECK. And this year is the year when the 40 cents became effective, is that not correct?

Mr. HINES. That is right.

Mr. RAMSPECK. And if we propose here to start out now at 65 cents, we are making an increase in the floor which the original act set of more than 250 percent, are we not?

Mr. PATTERSON. Not in comparison to the value of the dollar.

Mr. HINES. Let me say that for 20 percent of our industrial workers we are increasing the minimum wages less than the cost of living has increased since 1941.

Mr. RAMSPECK. But actually the bill you are testifying on, the Senate bill, proposes an increase in the present law of more than 250 percent, does it not? That is, in the floor. They are going to substitute 65 cents for 25 cents.

Mr. HINES. Well, no; we are not substituting 65 for 25. We are substituting 65 for 40. The law now provides for 40 cents, and we are substituting 65 for 40, which is considerably less than 250 percent.

Mr. RAMSPECK. You are proposing in this bill to give the industry committees the right to go 'way beyond 65.

Mr. HINES. No; we do not. What we say, by the way, is that we favor the absolute minimum, and from that point on we do not believe that there ought to be any rates fixed by any industry committee or anybody else. That should be done by collective bargaining. We offer amendments to the bill.

Mr. RAMSPECK. Then you oppose the provision of the bill which would permit industry committees to go beyond 65 cents, is that right? Mr. HINES. We oppose any effort on the part of any committee to set what really becomes maximums above the minimums. We think that that can be accomplished through collective bargaining.

Mr. RAMSPECK. What is the average wage today of skilled workers in industry?

Mr. HINES. Well, our building trades rates run well above $1. They run up to $1.35.

Mr. RAMSPECK. I am talking about the average, now, and not the maximum.

Mr. HINES. I do not have those figures. I cannot answer you. Mr. BARDEN. Do you understand that there is any big percentage of people now working under the 65-cent-an-hour rate?

Mr. HINES. Our figures indicate that only 20 percent of those engaged in industry are getting less than 65 cents. Of course, we advocate the extension of this to cover certain workers that are now exempt, which would increase the number.

Mr. BARDEN. What does that include?

Mr. HINES. Agricultural workers, canning workers in the processing of food.

Mr. BARDEN. And now you are raising this 65 cents to match the cost of living. You think that is what it will take to match it?

Mr. HINES. It will not match the cost. It will not increase the cost of living.

Mr. BARDEN. Now, next, when you include your canning of food, do you not know, as a practical proposition, that that is immediately going to step up the cost of living?

Mr. HINES. No; I do not know that at all, and I do not agree with it.

Mr. BARDEN. What is your theory on that? How is it you think a commodity that takes 85 to 90 percent for labor can go up 30 percent or better say 50 percent-on the cost of that item, without it costing more? How are you going to do that, and who is going to absorb the additional cost?

Mr. HINES. Well now, you are giving us facts with regard to the canning industry now, that 90 percent of the cost is labor?

Mr. BARDEN. I am saying you are proposing to include agriculture, canning, lumber, and everything else just as you are the group you are discussing. Who is going to absorb that? You say they are now working for 40 or 45 cents an hour, and the price on those commodities is fixed. The OPA ceiling price is taking into consideration the cost of production. It is fixed, and they have tried to leave a margin in there that the man producing could live on. Now, when you put the cost of production over and above that price, won't you either stop production or lift the price up?

Mr. HINES. You are assuming, Congressman, that the margin of profit there is such, or that there are no other factors that enter into the cost of production except labor.

Mr. BARDEN. I said in those commodities where, for instance, labor is 85 percent of the cost of it, and there are quite a few of them.

Mr. HINES. Undoubtedly in any instance where labor is 85 percent, when you increase that particular cost it is going to be necessary, I would believe, to increase the price.

Mr. BARDEN. You are dealing with agriculture when you are talking about 85 percent.

Mr. HINES. I do not know. I am not too sure of that. I do not know whether you were here a few minutes ago when I referred to figures produced with regard to the tobacco industry, which indicated that 58 percent of the workers in the tobacco industry are receiving less than 65 cents an hour. Now I ask you, with the tremendous sums spent for advertising as a result of competition that exists between the Big Five-which does not sell one more pack of cigarettes, by the way, but they compete with each other and they switch from the cigarette without a cough to the cigarette that has a mild taste or something else do you believe that the tobacco industry can increase wages to 65, 70, or 75 cents without increasing the cost of its commodity?

Mr. BARDEN. Why certainly I do not think they could increase their costs to 75 cents without increasing their price. Nobody else with any gumption would make a statement like that, unless the OPA has been worse than crooked.

Mr. HINES. Do you believe that advertising in the instance of the tobacco industry is a big factor in the cost of producing cigarettes?

Mr. BARDEN. Well now, my friend, I am not up for examination; but I will say this: Advertising is a part of our American way of doing business; and the printers and the bookbinders and the folks who set the type in the shop that prints the advertising must live just as you do, and if you strike out advertising in this country-and that is what you are advocating

Mr. HINES. No; I am not.

Mr. BARDEN. You say, there is no need for it. If you strike it out, what about all your printers and the millions of people that are engaged in that very thing?

Mr. HINES. I am not advocating the elimination of advertising. I am suggesting that some of the money be diverted to the pay envelope of the worker in the industry, and I submit that the country as a whole would be better off; and I raise that question merely to offset the argument that you advance that there are no other factors except labor in the production of various commodities in agriculture.

Mr. BARDEN. I beg your pardon; I did not make that statement. I do not imagine the gentleman belongs to any of the printers' organizations or the newspaper organizations.

Mr. HINES. I belong to the American Federation of Labor, and we are all for one and one for all; and I think that the officials and I think that the membership of the various unions that you refer to would agree with me that more money should be diverted to the envelope of the tobacco worker than to the advertising account.

Mr. BARDEN. The farmer gets 422 cents for raising the tobacco, and the Government gets $1.22 a pound tax.

Mr. HINES. Maybe the answer lies there, that you ought to cut his tax and put it in the envelope.

Mr. PATTERSON. Also, Mr. Congressman, you will have to figure out how much profit that particular manufacturer is making. Industrial profits throughout the war have shown a 147-percent increase. Maybe some of that can be reflected in the price in a downward scale.

Mr. HINES. I do not think that because wages are raised in any particular instance, it immediately means an increase in the cost of its products.

Mr. BARDEN. That was the answer I wanted from you. I wanted to know if you thought you could raise the cost of production without raising the cost of the commodity.

Mr. HINES. In many instances, yes.

Mr. BARDEN. What percentage of the instances?

Mr. HINES. I am not qualified to give percentages.

Mr. BARDEN. Would you not have to be before you could advocate a policy of putting it in a Federal law?

Mr. HINES. NO; we could arrive at some idea by referring to the fact that only 20 percent of industrial workers would need to be raised to bring them up to 65 cents. That, of course, would, I presume, be more than the others we are going to extend coverage to.

I will say this, Congressman. I think we ought to worry less as to whether or not this is going to cause an increase in the price of the commodity, and worry more about purchasing power in the pockets of the workers of this country if we are going to keep our economy on a level basis.

Mr. BARDEN. Can you worry about one without worrying about the other? That is what I am talking about.

Mr. HINES. I think it is more important to consider whether or not we keep our factories going and whether we have full employment than it is to worry as to whether or not the price of one or two or more articles is increased as a result of the general program.

Mr. GEELAN. May I suggest that the committee be supplied with data as to the number of industries in which such a situation would apply, where this bill would result in an increase in the price of the commodity? Also, data as to how many workers in the various industries are now receiving below 65 cents an hour.

Mr. RAMSPECK. Yes; of course, I get back to what I have said many times. I think the question is a question of fact in each case. I do not believe that we can theorize about it too much or generalize about it. It is a question of whether or not a particular employer can raise his wages without increasing the price of his product, and that depends not on any theory but on the question of what it actually costs him to produce it. Sometimes it is not altogether a question of being the same between different manufacturers in the same line. It depends on the type of machinery and the efficiency of the management as well as the efficiency of the employees, does it not, Mr. Hines?

Mr. HINES. We have found within a given industry that certain employers can undersell other employers because they have more efficient machinery and up-to-date machinery, and do not use the antiquated methods that the other employers use, and that has been one of the drawbacks to advancement of workers' welfare in industry, where they have themselves had to make concessions, where they have held down, on the plea of the employer that he could not pay as much as the other fellow because he had to take it out of their hides on account of his antiquated machinery.

Mr. RAMSPECK. That is why we ought to keep this act as a Minimum Wage Act, and leave the wages above that to collective bargaining. Mr. BARDEN. When you are talking of the agricultural industry, I might say to you that the overwhelming percentage of the farmers and agricultural people of this country are woefully undermechanized. Mr. RAMSPECK. That is true.

Mr. BARDEN. They still use mulepower and manpower, and they produce the overwhelming percentage of the agricultural products of this country.

Mr. RAMSPECK. That is true.

Mr. BARDEN. Of course, when you are dealing with a problem you must take that into consideration.

Mr. GEELAN. Does the act contemplate coverage for people working on farms?

Mr. RAMSPECK. No; it does not, and none of the amendments do, but I understand Mr. Hines is advocating that.

Mr. HINES. We are advocating the coverage of workers engaged in the processing of foods.

Mr. GEELAN. Is that people working on farms?

Mr. HINES. There has been an attempt made by interested people to include workers in canning factories as agricultural workers. They are not. They are working in an industry.

Mr. GEELAN. We are talking about two different things, then? Mr. HINES. Yes; they are the same as workers that are engaged in the production of clothing or shoes or anything else.

Let me say this, Mr. Chairman, for the record. It is not my position or the position of the American Federation of Labor that in some instances prices may not have to be raised, but we are certainly opposed to the general impression that is trying to be created that in every instance, or in an overwhelming number of instances, it would be necessary to raise prices if we raise wages. We contend that somewhere along the line there are certain factors that could contribute to increasing wages without imposing a burden on the consumer, and if