Factory employment declined 11 percent over the same period. Relief cases were up 6.5 percent over the same period last year. Building permits in the year 1955 were one-half of those in 1954. This is only a small picture of what can happen to a city when it loses industry, and unless new industry moves it, this can grow worse. In the past few months we have interviewed or communicated with over 100 prospects that would like to either expand their industrial operation or move from their present area that have a tight labor supply. Many of these firms are just looking for cheap labor markets, or want something for nothing. However, many of them are good, reliable firms, looking for a more plentiful labor market, but lacking the necessary capital to make the move from one community to the other. The Amsterdam Chamber of Commerce offered these firms a new 50,000 square-foot industrial building and has available over 2 million square feet of desirable floor space in the buildings vacated by the Bigelow-Sanford Carpet Co. All of this is at a very low retail or purchase arrangement. Up to this moment the plan has not been successful, primarily due to the lack of moving or expanding capital on the part of the interested prospect. This is where the merits of such a bill as I have introduced and other companion bills should be mentioned. In addition to the above, this is to advise the committee that additional stores in the city of Amsterdam are closing, and more families are moving out of the community in order to try to obtain work elsewhere. It is needless to say that this bill could materially help where there is need for "risk capital." The CHAIRMAN. We are glad to have your views. I am sure they will be considered by the committee. Call the next witness, Mr. Clerk. The CLERK. The next witness is Hon. Cleveland Bailey from the State of West Virginia. STATEMENT OF HON. CLEVELAND M. BAILEY, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF WEST VIRGINIA The CHAIRMAN. Mr. Bailey, we are glad to have your help in solving this problem. You are enlightened by experience and long service. Mr. BAILEY. Mr. Chairman, it is not my desire to take up the time of the committee. I understand the House is in session now, and the committee is operating on borrowed time, but I do have a story I would like to bring to the committee for the State of West Virginia, but I shall only touch on a few of the high spots. Mr. Chairman and members of the committee, for the purpose of the record, I am Congressman Cleveland M. Bailey of the Third West Virgina District. I appear specifically in favor of H. R. 8986, legislation I introduced in February of this year, to provide Federal assistance to encourage new industries in critical areas of the Nation that have been certified by the United States Department of Labor to the President as having more than 8 percent of their labor force presently unemployed. Mr. Chairman, I would like my remarks to be considered as supporting a score or more of the other bills bearing on this same subject that have been offered by my colleagues in the House. I submit, Mr. Chairman, that the interest shown by these legislators, as indicated in the number of bills introduced, that there is great need for this type of legislation. If there is one State in the Union that needs a shot in the arm economically, it is West Virginia. We have a greater percentage of unemployment than any other State; some 15 months ago we had a total unemployed of 79,200. This was 15 precent plus of the total labor force of the State. Of the 79,200 unemployed, we had 253,200 of the State's 2 million population living on surplus Government foods. This is 1 out of every 8 of the State's 2 million men, women, and children. There were 26 counties out of 55 in the State that had been declared critical areas of unemployment by the President by information certified by the Department of Labor. The situation is somewhat improved today. We still have 61,000 unemployed. This represents 11 percent of our labor force and 17 of the 26 critical areas mentioned above are still critical. Of the 61,000 unemployed, more than 40,000 are miners; 5 years ago there were 130,000 miners working in the State; today there are 71,500. If you add this to the 40,000 unemployed, you will have a total of 111,500. This means that 19,500 miners have left the State of West Virginia to find employment elsewhere. Aside from the situation in the coal industry, there are more than 20,000 other people out of jobs. These come from the glassware, pottery, clothespins, marble, chemical industries. Now, I ask you, gentlemen, why is this? My reply to you is that it is our present national trade policy. Residual fuel oil coming in from Venezuela and the Near East has taken more than half of the State soft coal miners. Exports from abroad of glass, pottery, marbles, and clothespins are taking their toll; 87 percent of the pottery products consumed in the United States in 1955 were imported from abroad. The situation is almost as bad in glass products, and in the manufacture of marbles and clothespins. There are 7 plants in the United States making marbles, 6 of which plants are located in the State of West Virginia; 2 of the plants are closed down completely; the other 4 will close down on July 1. Why? Why did I say our trade policies are responsible? These marble plants are closing because of the Japanese trade agreement that we approved at the last session of the Congress. The competition is coming from Japan where they pay as low as 11, 17, 18 cents an hour, compared to $1.62 an hour in our marble plants in West Virginia. Let me call your attention to the situation affecting us. We have the world's largest clothespin plant in my district. Our chief competitor there is Sweden. Sweden pays 38 cents an hour to their employees in their plants. We pay $1.56 in the plant at Richwood, W. Va. Sweden can produce those pins on a 38-cent wage level, pay the transportation costs across the ocean, pay the insurance, pay the brokerage, pay the 5 cents gross, that is 144 dozen import duty which has been cut from 20 cents to 5, sell those pins on the wharf at New York for 61.4 cents, and it costs 93.7 cents to produce the same pins in my plant at Richmond. Now, why is that plant still operating? It is operating for one sole reason: When they attempt to ship those Swedish clothespins from the port of entry at New York into the interior of the country, our high freight rates eat up the differential after they have come about 200 miles into the interior. Our plant is depending on the markets of the interior part of the country, which Swedish competition cannot meet because of our high freight rates. Let me call your attention to one of the Nation's largest glass producers, and I am speaking now of the Pittsburgh Plate Glass. They have 17 plants scattered across the central part of the United States from western Pennsylvania to Oklahoma. The situation is such that the manufacturers of window glass-that is one of their chief products as well as plate glass-the situation is such that they manufacture window glass in Belgium and they can manufacture it, ship it to New York and offer it for sale at New York or any other eastern port cheaper than we can produce it in the plant at Clarksburg. Why are they still holding on? And why did I lead a fight against the St. Lawrence seaway? Right now they are barred by this high freight rate on glass from the eastern seaports to the interior of the country. I made a fight against the seaway on account of the fact that it would take the rest of our coal markets, when cheap oil comes in through the seaway in tankers. Let me say to you right now, when the seaway is completed, a ship will be loaded with cars made at Detroit; they will go over to Antwerp, Belgium, and unload the cars or some other port in Europe, they will pick up a shipload of Belgium glass, Belgium-made glass, they will bring it into the interior, into the lakes, and take away the business of the 17 plants of the Pittsburgh Plate Glass Co., just as sure as the seaway is constructed. It won't come in an American bottom because only 2 percent of your American shipping right now can use the seaway. We built it for the benefit of a bunch of foreign tramp steamers. Let me remind you that of the 10 million tons of freight that passed through the Welland Canal in 1954, not a single ton of it was carried in an American bottom. I think I could offer you all kinds of justification. Some of you wonder sometimes about the activities and the views of the gentleman from West Virginia. I am fighting to try to save my State's economy. Seven of our main products are hit by the operation of our trade agreement, the present trade agreement. It is one of the States in which we have a concentration of industry. It is one of the States, if there is any justification for the Federal Government-who is responsible for that situation? Not the State of West Virginia, not the industry of West Virginia, not the workers in the plants: The Federal Government, by leaving on the statute books our present trade agreements that permit foreign-made products to come into this country at an import duty that does not protect the American worker and American industry. That is the answer, Mr. Chairman, and West Virginia has no hopes to improve its economic situation until we can have better protection for the thousands of workers that are working in plants that have to meet this continued and almost unrestricted importation. I could go into all of the details of this. I don't think that it is necessary. I would like to lay a lot of the facts before you. My Governor, our Governor in West Virginia, has been putting on a nationwide campaign to attract industries to West Virginia. We have all of the natural resources and all the facilities that are necessary to attract industries. We certainly have plenty of surplus labor. But I want to say to the committee, I don't appreciate and don't support his idea of going into the other States like Rhode Island and Massachusetts, where the unemployment situation is almost as bad as it is in West Virginia, due to this same trade policy, and try to steal their industries and bring them to West Virginia. I am not in sympathy with that attitude at all. Massachusetts is not to blame. Rhode Island is not to blame. The Congress of the United States is solely to blame for the soft spots existing in our economy. We have a national prosperity equal to any we have ever had in the country, possibly in the history of the country, but it is not nationwide. It has to many soft spots, and one of them is in West Virginia. Just what do you propose to do about it? We have scores of towns ranging anywhere from 1,500 population to 3,000 or 4,000, that their only industry was a mine, that maybe employed 250 or 350 or 450 men. That mine is closed today; 371 of them are closed in the State of West Virginia. There is nothing there. The company has even pulled the steel off of the ties running into their mine operations. They have closed the company store. Most of those people own their own homes. There is no other industry they can turn to. It is an ideal opportunity for the Government to bring, even if they are small industries, one that would employ 150 or 200 would be a lifesaver for these communities that are ghost towns now, more than a score of them-not a single individual working in the town, unless they go outside of the State of West Virginia to find employment. Mr. MULTER. Mr. Bailey, may I interrupt you for a moment? Mr. BAILEY. You may. Mr. MULTER. And suggest that you not be carried away by this Republican propaganda about the prosperity of the country? The national gross income of the country is the same this year, 1955, as 1954, because the gross income of the big corporations, big business, has increased by $1,200 million, and the reason you get the same total in 1955 as in 1954 is because the farmers and the small businesses have lost over a billion dollars in income, so you have got an approximate balance in the total gross income, but the little fellows, the little farmer and little businessman is not prospering today as evidenced by the fact there are only seven States that do not have a labor distressed area. Mr. MUMMA. Will you yield? Mr. MULTER. There are 129 major areas listed by the Department of Labor in their statistics, and they are in every State except seven. Mr. MUMMA. Mr. Multer, you didn't mean it to be political, in speaking of the Republican prosperity? Mr. MULTER. Republican propaganda about our prosperity. Mr. MUMMA. That makes the statement better. What we have been listening to from Mr. Bailey is really the result of the Cordell Hull Reciprocal Trade Agreements that have been in effect for 15 or 20 years, but with the war prosperity, we didn't mind that. Your factories were busy making something for the war. Isn't that correct? Mr. BAILEY. If the gentleman was in Congress in January 1945- Mr. BAILEY. If you were, mine was the first voice raised against the operation of our trade agreements. I started the fight then to try to get relief for some of my industries in West Virginia, and for the past 10 years I haven't done much else except to try to protect the industries of the State of West Virginia from the operation of our trade agreements. Mr. MUMMA. I will say, since I have been here you have been doing that faithfully. Mr. WOLCOTT. Will the gentleman yield? I don't think Mr. Multer would want to leave unnoticed a very apparent misstatement with respect to the national product. I don't think he intended to. Mr. MULTER. I said the national gross income. Mr. WOLCOTT. Gross national product is something like $40 billion more than it was in 1954, and the national income is proportionately higher now than it was in 1954. Mr. BAILEY. Mr. Chairman, if I may make this observation, this is not exactly a political situation. If you will recall, I led the fight last year against the extension of the trade agreement, and on the first roll call, in opposition to the rule that would bring the extension of the trade agreements before the Congress, there were 104 Republicans; 103 Democrats joined. In other words, the issue I am talking to you about wipes out parity lines. It is an economic condition that the Democratic administrations in the past haven't corrected and there is no apparent indication on the part of the present Republican Administration to do it either, unless the Congress forces some action. The CHAIRMAN. I know what the gentleman says Mr. BAILEY. Let me make myself plain. I am not opposed to the idea of trade. I am not opposed to reciprocal trade, but our trade policy has ceased to be reciprocal. We have been doing all of the giving and somebody else has been doing all of the receiving, and something is going to have to be done to change that situation. You are either going to drive 140 or 150 of your small American industries into bankruptcy or you are going to change our trade policies, and if you don't do it, one of these days you are going to wake up and be a Nation of importers rather than a Nation of producers and exporters. That is what is ahead for you. The CHAIRMAN. Will the gentleman yield to me for a minute? Mr. BAILEY. Yes, sir. You have driven your watch industry out of business. There is just one American watch operator. Eighty-seven percent of your pottery consumed in this country last year was produced abroad. We will say the pottery industry is in its last stages. I could name you a score of others that are gradually being driven out of business. They just don't close up and die overnight. They are |