Now, let me illustrate from Mr. Plaine's testimony how unworkable the bill will be if the definition is not confined to gambling devices. On page 106 of his testimony, which appears in volume 2 of the transcript, in discussing punch boards, and when asked why the Department had left punch boards out, he said this, or first I will ask the question:

Mr. DOLLIVER. Do you believe the definition which is in the Department's bill would include these cards that they call punch boards?

Mr. PLAINE. No, sir, it does not. Actually the bill before the conference on March 16 specifically included punch boards and the conference struck it out not because it was against hitting those, but they were afraid that the breadth of the definition might include so much as to make this bill really unworkable.

Now, our industry, the toy industry, and everybody else engaged in making amusements are much larger than the punch-board industry, and there are a tremendous number of machines that are included, and I think that if this bill includes amunsements as well as gambling devices, it would really be unworkable, and that Congress would be enacting an unworkable bill. Now, there are hundreds of machines within our industry besides pinball machines, and the pinball machine is now a generic term that covers many things, and not just the type that we think of. If each governor were required to certify legal amusements, the Federal Register would read like a catalog of amusement machines, and the governor would spend a great deal of his time writing to the attorney general to tell him about new machines and the manufacturers would prod the governor so that they could sell in that State.

Now, especially in our industry-and this is where we differ very, very distinctly from the gambling end of the coin-machine businessa slot machine is built like a battleship and will last for 50 years, and there are some very old ones on the market. You do not need novelties in a slot machine because it has an award which is offered the player. He will go on playing that machine for 15 years. But a pinball machine or any other amusement machine is an amusement thing, and the public is fickle and needs new amusement machines. Consequently, our manufacturers of pinball machines design a new machine every 4 or 6 weeks, and they have no way of telling whether the machine will be a success before they put it before the public. It depends entirely upon its play appeal, and its amusement appeal. The slot-machine manufacturer will come out with a new machine and it will be chrome plated and a different color, but there will be no substantial change and he knows beforehand that the public will play that machine.

Now, here are our people turning out new designs, and they are very ingenious, and they will be forced to go to the 48 State governors to try to get their machines certified so that they can sell them, and I think that that is an unreasonable requirement.

I will just make one more point, and then I am going to stop, because I have already taken up too much time. Section 5 of this bill has nothing to do with interstate commerce and has nothing to do with aiding the basic policy of the States to suppress slot machines. Section 5 is an additional antigambling code for the District of Columbia and for the various possessions of the United States. What it does is to make unlawful in the District of Columbia, Alaska, Hawaii, and Puerto Rico the manufacture, reconditioning, repairing,

sale, transport, possession, or use of any gambling device as defined by section 1.

Now, if amusements were included for the United States possessions and the District of Columbia, there is no certification that can save the innocent machines and Mr. Plaine said that in the States, even if amusements were included within the definition of a gambling device, they can be saved by certification of the governor. They might well be, but there is no such saving clause for the District of Columbia and for Alaska and Hawaii. All of our equipment, pinball machines, and everything else we make, is now legal and taxed in the District and in Alaska and Hawaii. If this bill were to pass and amusement were to be included, innocent industry would be put out of business in those lands subject to the United States jurisdiction, and for that reason we suggest this amendment, and we are joined by the toy manufacturers to ask this group to correct that evil.

We only make this recommendation, and if this committee would like to talk with us further, I think that we could make some helpful suggestions on how to narrow this down to strike at the evil which was intended to be struck at, and not to include innocent people in this bill.

Now, Mr. Preston, in testifying on his bill, which was introduced prior to the Government bill, said clearly that he intended only to strike at the slot machine and similar gambling devices, and not to include the pinball machine, even though the pinball machine in a few places might be illegal and undesirable, or they may think so. His idea was to strike at the vicious gambling machines, which are the slot machine and similar devices. So that is what we ask this group to do; and I thank you, gentlemen.

Mr. Plaine, on page 70 of his testimony, volume 2, said this:

Let me say categorically that the purpose of the bill is to support the basic policy of the States which outlaws slot machines and similar gambling devices.

There is no basic policy of the majority of the States against our equipment, as there is against the slot machine. I notice on the front page of the transcript it is entitled "Slot Machines."

Mr. BECKWORTH. Is it your thought that there are any pinball machines which are in fact gambling devices?

Mr. RUTTENBERG. We would say there are no pinball machines that are gambling devices, but there are some devices which are built to resemble pinball machines which are gambling devices, and which we frown upon.

Mr. BECKWORTH. What is the best test you can describe in a few words, if possible, to distinguish between the two?

Mr. RUTTENBERG. You mean the gambling pinball machine and the amusement pinball machine?

Mr. BECKWORTH. Assuming you have a machine that would to the average person appear to be a pinball machine, but which is actually a gambling device, what would be in your opinion the best test as to how one could distinguish between the two-whether it is a gambling machine or not?

Mr. RUTTENBERG. I believe the best test would be this: That in a gambling pinball machine, the person would not walk up and play it unless he gets a monetary or merchandise award, and with our ma

chines he will play it and not expect any award, and that is the way the two machines are operated as a practical matter over the country. The Internal Revenue Department in many districts distinguishes between the two machines. They charge $100 for one and $10 for the other.

Mr. BECKWORTH. In your opinion the Internal Revenue Department had no real difficulty in distinguishing between the two?

Mr. RUTTENBERG. I do not think so; no. By reading our trade magazines, there is a great distinction between the two.

Mr. WOLVERTON. I know of a resort that I go to occasionally in the summertime and they have the pinball machines such as you speak of as an amusement device, but above it there is a card placed that if you get certain combinations, then you are entitled to two packages of cigarettes, or something else of value. So it is the card above it that really makes it a gambling machine.

Mr. RUTTENBERG. It is the use to which it is put by these people, and not the intent of the manufacturer.

Now, I might say that we made a survey and that a man who owns that amusement pinball machine is being very stupid, because our machines will not make any more money if he offers prizes than if you just offer amusement. They will not make any more. People will play our games just for the sheer amusement, and they do.

Mr. BECKWORTH. With reference to the question that has been asked, that machine with that card just above it definitely would be considered a gambling device.

Mr. RUTTENBERG. There is no question about it.

Mr. BECKWORTH. At what point precisely would the Government have a responsibility to do something about that machine, assuming that it was innocently purchased and innocently transported from the beginning? At what point would the Government have a responsibility to do something about that machine?

Mr. RUTTENBERG. Where that type of use became the rule rather than the exception, I would say. Now, in any gambling device that I have examined or read about, the manufacturer had to build something in that machine, some pay-out chute or some gadget to make it a gambling device. Our people on the other hand are scrupulously trying to discourage the very use that this gentleman described. We are trying to discourage that and trying to educate the people who use our machines.

Mr. BECKWORTH. Supposing a cigarette machine is owned by an ingenious person and he puts a slot on it by which money can come out. He would then be liable; would he not?

Mr. RUTTENBERG. If he shipped it in interstate commerce or possessed it in the District of Columbia or in the United States possessions. But I might add that in order to do that, the man would have to be an electrical engineer and redesign the entire machine. It would be like converting a radio to a television set.

Mr. BECKWORTH. It would be a difficult job.

Mr. RUTTENBERG. It would be very difficult, indeed.

Mr. WOLVERTON. I think the chairman was seeking knowledge_as to how the Government could proceed in a case like that. If the Internal Revenue Department puts a tax on it of $100 under the present statute as a gambling machine, they would go out of existence quickly

because they have long rooms filled with them, and it would not be financially worth while for them to operate them. Thus the Government could stop it.

Mr. RUTTENBERG. I will agree that there is a good deal of merit to what you say, and there might be an idea there.

Mr. BENNETT. Is it not also true that in the case mentioned by the chairman, if gambling was illegal in that State, the person adapting it to that use would be in violation of the State gambling laws? Mr. RUTTENBERG. Pardon me.

Mr. BENNETT. The person adatping it to such use would be in violation of the State gambling laws.

Mr. RUTTENBERG. Everywhere except in Nevada.

Mr. BENNETT. Any State that had gambling laws.

Mr. RUTTENBERG. That is right, in the 43 States that outlaw that type of thing.

Mr. BENNETT. So it seems to me that what the Attorney General is trying to do here is to regulate the use of a device that is presently and for all time past has been a matter regarded as a State enforcement proposition. In other words, practically all States have laws against gambling, and the use of gambling devices within their borders. Mr. RUTTENBERG. That is right, sir.

Mr. BENNETT. And if somebody takes a harmless amusement machine and converts it to a gambling device, in 9 instances out of 10 he would be in violation of a specific State statute; would he not?

Mr. RUTTENBERG. I believe in 10 out of 10 he would be; in every State he would be if he did that.

Mr. BENNETT. In every instance except where the State did not have any laws against gambling.

Mr. RUTTENBERG. That is right.

Mr. BENNETT. And of course this bill does not attempt to cover those States in any case, as I read it.

Can you not get together a better definition of a gambling device than you have put together here? It seems to me that you felt the language of the Attorney General was not right and you sought to exempt specific types of machines, rather than to specifically define a gambling device.

Mr. RUTTENBERG. I did that intentionally, sir. The Justice Department has a very large and able staff of attorneys, and they have done a lot of research and I did not want to be presumptuous and change their language, frankly, and I thought it would be better for us to recommend it in this manner.

Mr. BENNETT. What is the responsibility of the Federal Government? It is simply this, as I see it: That it wants to cooperate with the States in preventing the interstate shipment of gambling devices. The function of the State is to prevent the use of such device. But the Attorney General is undertaking, it seems to me, to enact a law which regulates the use of a gambling device or anything that he says is a gambling device, as against the piece of legislation that will take into consideration the function that Congress has in matters of that kind, and that is to regulate the interstate transmission of gambling devices and specifially define such a device so everybody will know where they are.

Mr. RUTTENBERG. This committee may desire to spell out the definition of a slot machine, rather than to spell out the things that are not included within the definition,and that would be a very simple thing. You might say that slot machines and similar devices should not be shipped in interstate commerce.

Mr. BENNETT. I think it should be directed to slot machines and they ought to be outlawed; but it seems to me that any machine that is manufactured or made by the manufacturer for the purpose of being used as a gambling device ought to be outlawed, period, whether it is a slot machine or whatever kind of machine it is.

Mr. RUTTENBERG. Mr. Morehouse of the Federal Trade Commission used some very good language yesterday; that is, "any machine intended or calculated to be used."

Mr. BENNETT. If a manufacturer makes and ships in commerce that kind of a machine, he ought to be prosecuted.

Mr. RUTTENBERG. If he makes an innocent machine and the user at the other end converts it into a gambling machine

Mr. BENNETT. And he can do that with almost any kind of a machine. Mr. RUTTENBERG. I would like to add one further thought. You mentioned that a card could be put up on our machines and convert them to gambling devices, and I would like to say that that is true of a bowling alley, and I have seen it done, where they have offered a ham for the best line during the week. You can do that with a toy or any other similar device.

Mr. BECKWORTH. Are there any other questions? Thank you, gentlemen, very much.

The Chair might state we have a good many witnesses who have indicated an interest in being heard, and because we have only two more days set aside for hearing on this legislation, it would be well for those who have similar interests to try to consolidate as many as you can of your statements in the interest of being sure that you have the privilege of appearing. We will do our best to accommodate you. Any lengthy statement that you might have, you certainly will have the privilege of including in the record.

The Chair also recognizes that the witnesses this morning did not take a lot of time except that occasioned by the large number of questions asked by the members of the committee. It is the desire to get an expression from all who want to be heard so that I do trust that it will be kept in mind we have but two more days at this time. Be just as brief as possible.

Thank you very much, and the committee adjourns until 10 o'clock tomorrow morning.

(At 12:20 p. m., the committee recessed, to reconvene Thursday, May 4, 1950, at 10 a. m.)