Mr. BALLINGER. In connection with these hearings. Would you full name for the record?

state your

Mr. BLACK. I have a statement here, Mr. Ballinger. Would you like me to read from that statement?

Mr. BALLINGER. All right.

First of all, I understand you represent certain business organizations in the State of Maryland?

Mr. BLACK. That is right.

Mr. BALLINGER. Would you tell me what organizations and in whose behalf you are appearing here today?

Mr. BLACK. I have a list of the names of these organizations which I can file with the committee.

Mr. BALLINGER. I wish you would put them in the record right now. Mr. PATMAN. I would like to see a list, if you have them mimeographed.

Mr. BLACK. I will read those off.

Chairman PLOESER. Is it a part of your statement?

Mr. BLACK. Yes. It is part of the statement.

Chairman PLOESER. Why do you not allow the witness to proceed with his statement?

Mr. BALLINGER. Yes. But he has several resolutions.

Mr. BLACK. I have one resolution.

Mr. BALLINGER. One resolution passed by these organizations? Mr. BLACK. Passed by these organizations.

Mr. BALLINGER. All right. Then continue with your statement. Chairman PLOESER. Continue, Mr. Black.

The room will come to order.

Mr. BLACK. Thank you.

My name is Robert Ï. Black, of Norbeck, Md. I am the president of the Maryland Economic Council, a State-wide incorporated organization operated on a nonprofit basis to promote and protect the interest of small and independent business.

I want to take this opportunity to thank the members of the House Small Business Committee for the privilege they have accorded our organization to appear and express our views on one of the most vital problems confronting the independent business men and women of Maryland.

The Maryland Economic Council was founded and is sponsored by more than 27 local chambers of commerce, boards of trade, retail merchants groups, and similar organizations of business men and women who own and operate their own businesses in Maryland. The primary purpose of the organization is to keep Maryland business men and women, through their existing local organizations, accurately informed on all developments affecting the general welfare of their businesses, and to act as a clearinghouse for the continuous coordination of their efforts and influence in areas of mutual interest.

We think it is most important that the members of this committee understand that the views to be expressed are not the opinions of a few individuals on our board of directors but represent as far as it is humanly possible the collective thinking of an overwhelming percentage of the individual business men and women in every section of the State of Maryland.

The council's views presented here today are based on resolutions adopted by individual organizations such as the Retail Merchants

Association of Westminster, the Independent Trade Association of Prince Georges County, the Chestertown Business Men's Association, the Denton Chamber of Commerce, and similar organizations of Maryland business men and women as well as on numerous conferences, conversations, and meetings of Maryland business men and women. These resolutions are an explicit statement of the attitude of the organizations federated within the Maryland Economic Council toward the development of co-ops.

During the past 3 months I have visited 20 of the 23 counties in Maryland and Baltimore City on numerous occasions and have met and conferred with hundreds of Maryland business men and women. These resolutions, conferences, and various meetings of business groups enable the council to document every statement we make.

The Maryland Economic Council is a nonpartisan organization and is neither a tool, front, nor mouthpiece for any political party. Our test of a candidate for public office is whether or not he is sympathetic to the problems of the independent, competitive business and whether he sincerely advocates those governmental policies-both State and national-which will result in encouraging the greatest possible ownership by the people of their own homes, their own farms, and their own businesses. We have no axes to grind. Our board of directors is composed of both Democrats and Republicans, all of whom are leaders in local business, civic, and service organizations in their home communities.

At the outset we wish to emphasize and make very clear that the Maryland Economic Council and the Maryland business men and women who support it are not opposed to cooperatives, provided cooperatives compete on fair terms with private enterprise. We are opposed to co-ops who enjoy special privileges which give them an undue advantage over privately operated business. Therefore, we wish to state as positively as is possible to do so that the business men and women of Maryland welcome this impartial study of cooperatives since it is their understanding that this is not a witch hunt, but a sincere effort to determine whether important privileges conferred on co-ops, such as tax exemptions and concessions and cheap Government credit have put private business at a disadvantage.

We believe it is most important that the confused thinking about co-ops be clarified and any wrongs or injustices corrected. No group should fear or object to a study by the Congress. In fact they should welcome it.

In every community in Maryland where I have visited-and that is most of them-the leading merchants and businessmen express fear and concern over the threatened or existing competition from co-ops. They fear this competition only on the ground it is unfair because it gives many competitive advantages to cooperatives over privately owned business establishments.

These business men and women would have no fear of competing with co-ops provided this competition was on an equal basis and if both the co-ops and privately owned business establishments had to observe the same "ground rules."

What Maryland merchants worry about and protest is the fact that co-ops have at least two distinct advantages over private business made possible by governmental policies.

The first of these is that the co-op does not have to pay the same amount or rate of taxes as a privately owned business in the same field and, therefore, the cost of operating a co-op is less than the cost of operating a privately owned establishment.

As all of you realize-because you have many small-business establishments in your own districts-if the small-business man had the same advantages that the co-op has under the tax laws, he would be in a much stronger financial position at the end of each year because he would not have had to pay out so much money in taxes.

Generally speaking, taxes are the third largest item in the cost of doing business for the average Maryland businessman. A study of Maryland business will show that after labor and cost of materials have been taken care of, the cash outlay for taxes is the next major expense. Therefore, it is quite obvious why the merchants fear any co-op competition that has such a big advantage over them in an area about which they can do nothing.

Maryland businessmen also fear the development of the co-op situation and regard it as a distinct threat to the future existence of their own businesses because of the advantage the co-ops have in borrowing money from a Federal cooperative banking institution at very low interest rates. I will not take the time of the committee-because I know you must all be familiar with the fact-to point out how the co-ops are able to procure money at extremely low interest rates, whereas a private merchant must deal through his local bank and pay a much higher price for his immediate working capital as well as his long-term financing.

This availability to the co-ops of money at the lowest interest rate in the United States gives the co-ops an advantage that is grounds for real concern to the person who owns and operates his own business. Maryland businessmen feel that the Federal Government through its policies should not provide distinct advantages to the co-ops which, if continued, ultimately will force independent business to suspend or liquidate.

All Maryland businessmen ask is a fair deal which requires that all people doing business compete under the same general conditions.

Frankly, the morale of successful businessmen is very low today. Most of them are worried about the future and particularly about what the future holds for their own business. One of the major reasons for this concern and worry is the threat of the co-ops and governmental tax and loan policies.

They feel that the co-ops will continue to grow and spread. All they have to do is recall articles they have read in the newspapers about how both the AFL and CIO are planning to launch co-ops in every community in the United States.

They see the farm co-ops moving in from one side, consumer and labor co-ops from the other side, and they wonder and fear if being in the middle they will not be squeezed out of existence.

Frankly, they don't know the answer; they don't know what to do about it. However, one thing is certain in their minds and that is co-ops should be made to compete on the same basis as private business without enjoying governmental advantages through tax concessions and low interest rates-which advantages are only made possible through money the Government raises in the form of taxes from these same businessmen and their loyal employees.

It has astounded me and other council directors during our travels through Maryland of the number of older businessmen in their fifties and sixties who have said that they had looked forward to turning over their businesses, which they had worked hard for many years to build up, to their sons and daughters. But now, in view of the co-ops and other governmental tax policies they have become convinced that the best thing they can do for their children is to sell or liquidate their businesses and recommend that their offspring go to work for. the Government or some large corporation.

This state of mind is very significant and dangerous to the future of America as we have known it.

For that reason, we again say that the Maryland business people welcome this study and sincerely hope that your committee will recommend a program to Congress that will permit small independent business to compete on an equal footing with the co-ops.

As to the Greenbelt cooperative which is the major subject for consideration at this hearing, we should like to submit the following resolution which our council has adopted and which any type of Gallup poll or survey will prove reflects the thinking and viewpoint of an overwhelming majority of Maryland business men and women. Would you like to have me read this resolution?

Chairman PLOESER. Proceed.

Mr. BLACK (reading) :

Whereas it has becom› known to the Maryland Economic Council, Inc., that the Greenbelt Consumers Services, Inc., has a monopoly—

as we regard "monopoly" in Maryland

over all trade and business located in the town of Greenbelt in Prince Georges County, Md.; and

Whereas said monopoly exists solely because of the power of the Federal Government through Federal Public Housing to create it; and

Whereas said monopoly represents a discrimination against private and independent business and is manifestly unfair to such business; and

Whereas the present mayor of Greenbelt, the Honorable George Bauer, recently introduced a resolution in the city council declaring that the best interest of the town and of residents in the town would be best served by admitting private business freely within its limits; and

Whereas such mayoral resolution was passed by a 4-to-1 vote in the Town Council of Greenbelt: Be it

Resolved by the Maryland Economic Council, a State-wide nonprofit organization of local chambers of commerce, boards of trade, retail merchants groups, and similar organizations of local Maryland business men and women, That a resolution is hereby adopted protesting the existence of said monopoly in Greenbelt and calling upon the proper Federal authority to bring about its immediate discontinuance and to admit on an equal and fair basis any legitimate private business which desires to locate in Greenbelt.

That is the end of the resolution.

We are not opposed to Greenbelt. It is to the advantage of businessmen to have as many nice homes and good living conditions and from high wages. We want to see maintained the highest possible standard of living because businessmen can only prosper when people in their community prosper, but businessmen are opposed to monopoly in any form except in public utilities. We are particularly opposed to the Federal Government keeping any kind of legitimate business out of the community and we believe the Government should abandon any policies that exclude private business enterprise from Greenbelt

or any other area that has been developed through the expenditure of the taxpayer's money.

Greenbelt has a population of approximately 7,500. It is our opinion that if Greenbelt was opened up to all types of private businesses, you would have many more stores and facilities for the convenience of the residents there. This statement is not based on hearsay but after a thorough investigation of the whole question.

To support this point, I wish to state for the record that officers and directors of the Maryland Economic Council have talked with a substantial number of responsible individuals in the grocery, drug, gasoline and tires, garage, jewelry, dry goods and ready-to-wear, clothing and haberdashery, restaurant, laundry, and hardware businesses, who have stated they will be very much interested in establishing stores in Greenbelt if the Federal Government through its policies does not prevent them from doing so.

Obviously, they explain they would not attempt to put any stores in any community where they understood the Government, the Federal Government, was opposed to new establishments and had created an existing monopoly.

We have also talked with owners of large shopping centers who have said they would be interested in building a shopping center at Greenbelt for such types of business as those referred to above, if present governmental policies were changed. Such shopping centers would mean a great deal both to Prince Georges County and Maryland as a whole and would benefit the residents of Greenbelt as well as thousands of other residents in that section of the State.

We shall be glad to provide the names of those responsible business men to the committee for its own information and verification if it is so desired.

In further substantiation of our statement that many private business organizations and concerns would move into Greenbelt if the Government monopoly was eliminated, we wish to cite Westminster, the county seat, of Carroll County of Maryland. Westminster is a city of about 6,000 population, with an additional 1,000 residents due to the fact that Western Maryland College is located there and thus becomes a city of approximately the same size as Greenbelt in the same State.

For the record, we wish to submit the telephone directory of Westminster.

Mr. PATMAN. No; we do not want that.

Chairman PLOESER. You can submit it, but you do not expect it to be printed.

Mr. BLACK. No, sir; I merely wanted to have it here. I am sorry. Mr. BALLINGER. You have a schedule there?

Mr. BLACK. I have a schedule, and I can read from it.

Mr. PATMAN. Somebody might want to put the Washington telephone directory in.

Mr. BLACK. An examination of the classified business section of this directory will show that there are 3, 4, to 5 individual businesses of the same nature in Westminster, whereas there is only one business of the same nature in Greenbelt.

Incidentally, I also have telephone directories here of several other typical Maryland cities.

Chairman PLOESER. What are the cities?