HOW MANY DOLLARS MAKE A JOB?

$20007 $40007 $10,000?

NO ONE CAN TELL BEFOREHAND

(Change in Gross National Product for Each Worker Added to
or Subtracted from Total Civilian Employment)

Now suppose that this bill had been on the statute books for the past 15 years, that we had the present national gross product, and that we had made the same percentage of error in the preparation of our National Budget that the Treasury actually made in its vastly simpler estimates of Government expenditures: What would it have involved financially? The answer is shown in my final chart.

(GRANTING SAME ERROR IN ESTIMATE OF PRIVATE INVESTMENT AND
EXPENDITURE AS WAS ACTUALLY MADE FOR GOVERNMENT EXPENDITURES)
In Terms of Present Gross National Product

TOTAL $525,000,000,000

92 BILLIONS

78 BILLIONS

'23 24

'25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41

This chart indicates what the full-employment bill would have cost from 1923 to 1941 because of statistical errors alone in terms of present gross national product, granting the same error in estimate of private investment and expenditure as was actually made for Government expenditures. In 1923, $10,000,000,000; 1924, $19,000,000,000; 1925, $13,000,000,000; 1926, $18,000,000,000.

1927, nothing; 1928, $4,000,000,000; 1929, $15,000,000,000; 1930, $11,000,000,000; 1931, $1,000,000,000; 1932, $34,000,000,000; 1933, $45,000,000,000.

27-419-65-pt. 6--17

1934, $92,000,000,000; 1935, $78,000,000,000; 1936, $8,000,000,000; 1937, $33,000,000,000; 1938, $40,000,000,000; 1939, $38,000,000,000; 1940, $1,000,000,000; 1941, $67,000,000,000.

Gentlemen, those are staggering amounts. They add up to $525,000,000,000. And bear in mind that those billions have no bearing upon full employment. Not at all. Those are the amounts that we would have spent under this bill simply because of statistical errors.

Senator TAYLOR. Mr. Mosher, I think that figures based on the amount that was lost during those depression years because of the product that we did not turn out due to the depression would come very nearly balancing that $525,000,000,000?

Mr. MOSHER. I have seen certain figures that would indicate such a result. I would hesitate to say that I agree with them. I would want a lot more study of them than I saw here. The fact remains that if we take the $525,000,000,000 and divide it by 19—that is, the number of years shown on the chart-we have an annual error on the basis of nearly $30,000,000,000. We ought to bear in mind, too, that these billions do not have any bearing on full employment, because you cannot adjust full employment on the basis of gross national product. There is no relationship. The figures do not indicate any relationship.

Senator TAYLOR. This bill shows that the studies by the Government which will be undertaken would not necessarily have to be based on the gross national product. If it was found that that was unreliable, they could bring in another factor. The object is to study it and see what does make it go and why these things happen, and then try to meet the situation.

Mr. MOSHER. A perfectly admirable endeavor, and one to which we all ought to be willing to subscribe. But I am trying to point out to you the dangers that may be faced if we make our moves dependent upon uncertain and inaccurate statistics.

Senator TAYLOR. What are you going to base your moves on?

Mr. MOSHER. I think we have to go back to the economic blind spots. It involves a whole series of moves. I have covered one or two of those.

Senator MURRAY. Do you not feel that if this bill had been in operation in the 1920's it would have prevented the inflation that developed in that period?

Mr. MOSHER. I do not know.

Senator MURRRAY. You do not think so?

Mr. MOSHER. I do not think so; no sir-and for the reason which I am going to give you in a moment.

Senator MURRAY. You think that even if this bill was in operation, nothing would have been done to have prevented the wild inflation and the Wall Street activities of that period which resulted in the final crash in Wall Street in 1929 ?

Mr. MOSHER. I think that the obligation to take moves on the part of the Federal Government to prevent depression and prevent inflation has been with us from the time we started, and I think it is still with us. This bill does point out the importance of it. But just let me add a couple of paragraphs, if I may. Perhaps I will cover what you have in mind.

Senator MURRAY. I am very anxious not to upset your efforts to finish up your statement for us; so I will not ask any questions at this

time.

Mr. MOSHER. Gentlemen, our national debt already is destined to reach approximately $300,000,000,000. That means that every child in this Nation will come into the world mortgaged to the tune of $2,150. It means that the average family of four in America will be in hock to the extent of $8,550.

In the face of such crushing burdens, a serious responsibility rests on those who propose to gamble a potential $525,000,000,000 or $15,000 per family-not on full employment, but on the statistical accuracy of a handful of Federal employees.

STATEMENT OF WILLIAM GREEN, PRESIDENT, AMERICAN FEDERATION OF LABOR, WASHINGTON, D.C.

Mr. GREEN. Mr. Chairman and members of the subcommittee, I am pleased to meet with you this afternoon and transmit to you the views and position of the American Federation of Labor regarding S. 380. The most deep-rooted, universally desired objective next to peace itself, which the war has brought forth, is desire for security. Workers want protection against inability to earn a living in a world that underwrites property. Loss of job is a major catastrophe to wage earners. It may mean loss of savings and investments in addition to disorganizing the life of the worker and his dependents. Unemployment leaves deep scars on mind and spirit, a cost which society as well as individuals must pay. Fear of unemployment is never completely absent from the lives of workers. The right of every person able and willing to work to an opportunity to earn the means to sustain life itself has become an increasingly compelling ideal as industrial production has come to more dominance in our economy, making unemployment correspondingly serious.

"Full employment" has become a worldwide ideal which peoples of many nations hope to establish and to maintain in the postwar. No one country can do it alone. The United States should lead the way. Its achievement will be the supreme test of our democratic institutions.

DESCRIPTION OF THE BILL

S. 380 deals with responsibilities of the Federal Government for promoting "full employment." Its statement of policy setting forth the following purposes, makes a powerful appeal to those who have borne the burdens of unemployment:

1. To foster free competitive enterprise through the investment of private capital in trade and commerce; and

2. To establish the right of all Americans able to work and seeking work, to useful remunerative, regular, and fulltime employment. The bill directs that the President prepare a national production and employment budget. This budget shall set forth

1. The estimated size of the work force.

2. The estimated volume of investment and expenditure by private enterprise, consumers, Federal, State, and local governments necessary

to produce the gross national product necessary to maintain full employment.

3. The estimated prospective volume of prospective investment and expenditure.

In case the national budget indicates a deficit in the expenditure and investment program, the President is directed to prepare recommendations for encouraging non-Federal investment and expenditure as well as recommendations for legislative plans to overcome the prospective deficit. Such a program may include but need not be limited to "current and projected Federal policies and activities with reference to banking and currency, monopoly and competition, wages and working conditions, foreign trade and investment, agriculture, taxation, social security, the development of natural resources, and such other matters as may directly or indirectly affect the level of non-Federal investment and expenditure."

The result would be a program of plans and specifications for needed public works for those not employed by private industry. An orderly program of needed public works is an end in itself and a powerful stimulant directly to the construction industry and indirectly to others. The desirabiilty of planned public works to supplement private investment and check trends toward deflation has long been discussed with approval. It was urged during the depression of the thirties. Constructive action on the proposal is long overdue.

Planning and timely initiation of public works are essential to "full employment" but do not constitute the main driving power. "Full employment" will come mainly from placing responsibility on private industry and requiring reporting on stewardship. As the right of persons to employment becomes a moral obligation upon those in positions of responsibility, its responsibility can be pressed home.

The initial step in establishing responsibility of private industry is to amend section 4 (c), page 8, line 9, by substituting "shall" for "may." The section would then provide for regular consultation between representatives of the functional groups of private enterprise and the President in reviewing current situations and in making plans for "full employment," and would read as follows:

The President shall establish such advisory boards or committees composed of representatives of industry, agriculture, labor, and State and local governments, and others, as he may deem advisable, for the purpose of advising and consulting on methods of achieving the objectives of this Act.

Senator TOBEY. I can see your point, Mr. Green, but is it not elementary, or at least the expectation, that the President would consult with these people?

Mr. GREEN. The bill as written provides that he "may." We feel it should be more positive. I think the President would exercise very good judgment, and so doing would respond to the spirit of the act. But there is the bare possibility that he, or some future President, might feel that such action is not necessary if it is left to his discretion. On the other hand, if it is required, made mandatory, it will create a better psychology, a better state of mind, if it is distinctly understood that representatives of those groups are to be brought in for consultation and advice. That is the point I wish to make, Senator Tobey. The CHAIRMAN. You may proceed with your statement.