faith and hopes that they would be able to provide their own social security in the retiring part of their life. These are the people which should be commended. However, they have and are being the most disregarded, disgraced, and treated with less respect than many of the gangsters and criminals who were recently investigated by the Kefauver committee. There has been and now is judiciary authority exercised in many of the local rent-control offices by the investigators, expediters, and even some office help. This should and must be stopped.

EACH YEAR FAITH IS DESTROYED

Each year we are told this will be the last year for any rent control, "I'll never vote for it again" but there is always some special excuse-just anything to keep the yoke of bondage on the property owners of America. We want to have faith in what our law-making body tells us and want this false representing stopped and we trust that we have elected such gentlemen to this high office who will be faithful to the principles of the Constitution of these United States and end this thing.

RENT CONTROL PLAN-AMERICAN DESTRUCTION

The United States is now completing its ninth year of Federal rent control. As in the past, the Housing Expediter again requests that it be renewed, expanded, and strengthened.

The year 1951 finds this country facing serious problems and it is time we stop and carefully consider the history and effect of this un-American so-called war emergency legislation.

FACE FACTS IN WORLD WAR I

First, let's look at what happened during World War I when the economy of the country operated without the interference of controls or rationing. According to the United States Bureau of Labor Statistics, we find that for the years 1913-15 and 1916 the general price structure, including rent, was gradually rising. We entered the war in April of 1917 and by December 1917, rent throughout the United States had dropped to where all of the gains of the previous 4 years had been wiped out, while the price of everything else in the economy had continued to rise.

This drop in rents came about due to the added vacancies that occurred. These vacancies came about because of the expansion of the Armed Forces which automatically reduced the civilian population. During World War I, as in World War II, the people had a great increase in dollar income, but their spending was not controlled or channeled. When left to their own choosing, they directed nearly all of their excess money to consumer goods rather than to housing. From the beginning to the end of the war the progressive expansion of the amount of spendable money had increased the all item price index 39 percent. Of course, this greatly added to the landlords' costs; nevertheless, the index on rent only had risen less than 3 percent during this period.

KNOW THE TRUTH IN WORLD WAR II

It is very important to remember that there was never a national housing shortage in the United States prior to rent control, and that the shortage developed within 1 year after rent control was inaugurated.

The law, as originally passed, was intended to keep rents from skyrocketing in industrial war centers where great increases in population were contemplated. Disregarding the clear intent of the law, its purpose was quickly expanded to the control of nearly every rental dwelling in the United States regardless of its connection with the war industry or any increase in population.

A DOUBLE PURPOSE-AN EXCUSE TO CONTINUE RENT CONTROL AND PUBLIC HOUSING

After the war's end, Federal rent control was extended, first, because of the housing shortage, next to stop inflation, next, because of a rental housing shortage (there was no shortage of homes for sale), and the last time it was because the Expediter claimed there was a shortage of rental units for the low- and middle-income groups.

Regardless of statements made by the Expediter, labor groups, or social workers, the only authentic figures accurately revealing the true housing situation are those issued by the United States Bureau of Census.

The recent booklets issued by the United States Bureau of Census completely cover every person and dwelling in the United States for 1950. Using these figures along with those of 1940 we see the effect rent control has had on our housing situation throughout the Nation. It will surprise many to find that— (a) The number of dwellings increased 23.6 percent.

(b) The population increased only 14.5 percent (the second smallest percentage gain in the Nation's history).

(c) The number of vacant dwellings increased from 2.5 million to 3.4 million. (d) The number of dwellings occupied by owners increased 8.2 million. (e) The number of dwellings occupied by tenants decreased 0.5 million. (This decrease in occupied rental dwellings, added to the hundreds of thousands of vacant dwellings for rent in 1940, reveals the tremendous loss of rental dwellings available.)

(f) The increase in the number of dwellings exceeded by 2 million the increase in families.

In 1950 there was the astounding total of 3.9 million dwellings occupied by only one person. This represents an increase of over 45 percent. (These singleoccupancy dwellings are heavily concentrated in the large cities still under rent control.) We now have a total of 7.3 million dwellings vacant or occupied by only one person.

CONSIDER A SIMPLE PROBLEM

These Government figures are hard to believe unless we are shown exactly what happened. To aid in understanding this paradox let's first consider a simple mathematical problem. When over 10,000,000 persons are taken out of their homes and put in servicemen's camps or sent overseas, as was done during World War II, is there an increase or decrease in the housing for the balance of the people? In a free economy there can be only one logical answer. We increase the housing for the balance of the people. How, then, was it possible to develop an apparent national housing shortage so quickly during World War II? We started with a considerable number of vacancies and logically we should have increased this number as we did during World War I.

The answer is that this shortage came about only because of a controlled economy. We froze rent at a low level in 1942 and almost simultaneously forced up wages to nearly double their former rate. We also added more workers per household, which increased the purchasing power of many families.

With the large surplus of money, the people sought to buy things they desired, but we stopped the manufacture and sale of most of these items and rationed nearly everything else of importance. The one important thing we did not ration was rental housing and, therefore, the Government actually channeled this excess money into rental housing. In only a matter of months the people spread out and took up all of the rental housing available. Working girls, bachelors, widows, widowers, and divorced people who shared occupancy and divided rent, each took his own individual dwelling. Married couples without children also spread out into larger apartments. By 1943 we had created a progressively false national housing shortage the more that went to war, the more the remaining civilians could and did spread out. With increased costs and frozen rents, the owners found it more practical, because of wear and tear, to rent to the least number of persons every time a vacancy occurred. This added further to the false shortage.

DECREASING RENTALS

Prior to rent control, great numbers of single dwelling structures were rental units. When rents were frozen on these dwellings it was not long before owners found it more profitable to sell them. Individual homes were the one type of rental units that buyers could get possession of by forcing out the renter. Hundreds of thousands of these rental homes were progressively sold and taken out of the rental market. Occupants renting them were evicted by the owner. In many casse, the evicted renters, in turn, bought a dwelling and evicted another renter.

This progressive buying, singly and by joint ownership of two- or threeunit apartment buildings, continues to take many rental units out of the market.

PROVISIONS FOR HOARDING HOUSING

Having seen how this great maladistribution occurred, it is readily understood that the most important figure to consider is the national figure of 3.9 million dwellings occupied by only one person. Surely this startling 3.9 million dwellings occupied by only one person was not due to their purchase of a dwelling. The tremendous increase in single occupancy was the result of single persons replacing families in dwellings. It is obvious that only under the protection of rent control have these individuals been able to spread out and cause this maldistribution of housing. These single people used to share apartments or private rooms and would quickly do so again in a free market. They are actually hoarding housing with Government protection. Remove rent control, and, with a nominal increase in rent, our Nation will quickly create hundreds of thousands of vacancies. Additional thousands of rental dwellings now being held off the market only because of rent control would again be offered to the public.

PENALTY OF RENT CONTROL

Further considering the so-called housing shortage, we know that there is a great surplus of vacant houses for sale in nearly every large city in the United States. There is also a surplus of hotel accommodations and private rooms for rent. There are also many new and decontrolled apartments for rent. Vacant apartments built before 1942 are still scarce, and always will be, while they are being sold at a false low price as compared to any of the above housing accom. modations which are priced in a free market.

Everyone looking for housing will continue to try to get one of the bargains under rent control. Only those frozen out will rent or buy in the free market which is abnormally high only because of rent control. How can we ever accumulate vacancies in the bargain, frozen units? Millions of vacancies have occurred during the last 7 years, but the Government has forced the owners to offer these vacancies at false bargain prices. Fortunately for the owner, he could pick the tenant to give his bargain to and so, naturally, he picked the smallest family with the greatest wealth and influence.

Large families without money or influence really need rental units, but they are frozen out and forced to rent decontrolled units or buy homes on an unsound basis. We will always have this so-called housing shortage under these controls and the middle- and low-income groups can never expect to get frozen rental units under the law. A proven road of hardship.

DISCRIMINATION AND MILLIONS UNFAIRLY TREATED

Any check of the treatment of owners under rent control will show that this law has been the most unfair law ever enforced in this country. The records show clearly that until the 1949 act was passed, no owner could even claim a hardship unless his net dollar income was substantially less than it was in 1942. In the meantime, because the general price structure had almost doubled, the owner's dollars would buy only half of what they would in 1942. Thus, the owner's purchasing power was frozen at a maximum of onehalf of what it was prior to rent control.

The Expediter's formula for the 1949 fair net income act is unfair and ridiculous. No attention whatever is paid to the figures on the owners' sworn incometax returns. Not even the most rabid advocates of low rates for public utilities have ever dreamed of figuring net returns so low as does this plan of the Expediter's. Under his method, no consideration whatever is given the value of the property and no interest on the mortgage is allowed to be used in calculating operating costs.

Is it good for our Government to make millions of good, frugal citizens subsidize others who may be rich, indolent, or otherwise? That is what we are doing. Was it fair to single out owners and say to them: "Your net-dollar income shall be the same or less than it was in 1942, while all others shall have no limit on their incomes"?

Today we help labor and farmers get higher than a free market price and let everyone else, except owners, sell their labor or products at the highest price in our history. If an owner leases to a renter willing and anxious to pay a fair price slightly higher than the frozen rental he is brought into the Federal court and tried for his great crime like a kidnaper, bank robber, or dope peddler. Does this sound like America?

WE MUST STOP UN-AMERICAN THINKING AND PROPAGANDA

For the last 3 years the Housing Expediter's office and his allied pressure groups have filled the records of the congressional hearings with the predictions of dire things that would happen if rent control was removed (mass evictions, riots, etc.). On checking the records, we find that many of these groups who were for rent control have been expelled from the main body because of Communist leadership. These Communists believed in socialized housing and were, and still are, desperately trying to carry on rent control.

UNJUST LAW CONTINUES

The proponents of this unnecessary, unfair, and un-American law know that it can only endure under a strong central-powered police state where recourse is far removed from those enshackled.

These same groups cry out against the use of Federal injunctions to stop riots and civil commotion in labor troubles, but highly endorse reducing the dignity of Federal injunctions to that of parking arrest slips by requesting and getting Federal injunctions for petty overcharges of rent. It is hard to understand how these groups can insist on collective bargaining between labor groups and employers and at the same time favor a law making it a Federal offense for individuals to voluntarily enter into personal contracts on housing without the provisions, rules, and prices laid down by a Federal dictator.

At no time has the Expediter suggested that an owner's net dollar income should give him the same purchasing power he had in 1942. At no time has he suggested that owners and renters (even the rich ones) be allowed to make a mutually agreed lease. He says he must protect the lower-income group, but actually he wants to control all housing.

HOW LONG, O LORD, HOW LONG?

Each year owners have suggested that vacancies being held off the market and those that come on the market be decontrolled. They have also suggested that all single occupancy dwellings or large dwellings that are not properly occupied be decontrolled, thus curing the maldistribution and the so-called shortage. These suggestions have all been vigorously opposed by the Expediter. Under the localoption rule, he has used every technicality to avoid having cities terminate rent control, but, in spite of him, over 40 percent of the 231 largest cities in the country have freed themselves of his control. Twenty-four of these 231 cities have lost population but gained housing; nevertheless, they are among those still under Federal control. It is crystal clear that the Expediter has at all times been interested only in perpetuating himself.

BEWARE OF THIS

In spite of having the greatest amount of housing in the history of the country in comparison to its population, the Expediter's present position is that we still need more but at a price lower than private industry can furnish it. This means that the owners of rental housing built before 1942 must continue to subsidize the renters (including the rich and indolent) until enough Government-owned public housing is constructed to give all the renters exactly what they desire at someone's else expense. Few, if any, legislators in Washington could approve such a financially impossible socialistic housing plan.

FREE ENTERPRISE-SOUND, LOGICAL LEGISLATION

Legislators should carefully consider the dangerous evils of continuing this law. They should realize that people when in fear of shortage and rising prices will buy and store more than they need of food, clothing, household goods, appliances, tires, and other articles that are consumed or quickly worn out. People will not buy or rent more housing than they need except when rent controls make it a rare bargain compared with the balance of the price structure.

If these are serious times, and if we are honestly trying to unify the people in an efficient use of our labor and resources, Congress should kill rent control, eliminate the Housing Expediter, and allow the people to mutually enter into free contracts on rental housing. This will automatically and speedily bring about a large extra supply of housing without the use of any new material or labor. What could be a more efficient manner of aiding in our defense effort?

Any fair-minded legislator will agree that the owners of rental property should have had the same position as all other citizens with reference to frozen incomes. Their rents should have been based on parity or the price index.

Scores of cities that have had the greatest gains in population in comparison to their gains in dwelling units have been decontrolled for a considerable length of time. The Bureau of Labor Statistics have issued figures on many decontrolled cities, and they show that rents have not risen to anywhere near their former relative position in comparison to all other items.

RESULTS OF COURAGEOUS LEGISLATION

The Expediter said publicly that it would be a miracle if rents did not double if controls were removed. The facts today show that he was trying to perpetuate himself by spreading fear. The courageous legislators who decontrolled these many cities have completely exposed and disproved the Expediter's statements. Decontrol of these cities has brought about the following results:

No sign of mass evictions, riots, etc.

A modest increase in most 1942 frozen rents.

No increase in many rents which had formerly had increases over the 1942 freeze.

A reduction in rents on many of the new and decontrolled units.

Sharing of single occupied units by one or more additional people, creating thousands of vacancies for families, and actually reducing the rents of these individuals.

Married couples without children vacated large apartments and moved into smaller ones vacated by single occupants, thus making available large rental units for lrge families needing them.

Bringing back on the market thousands of rental units that had been held off because of rent control.

No more begging, buying furniture, black market bonus, etc.

The renewal of closer relationship between the owners and renters and the freedom to work out mutually beneficial matters without the interference and propaganda of the Housing Expediter.

An increased value of the rental properties, thus justifying increased real estate taxes so badly needed by these cities. (Under rent control the small home owner has been taking most of the added tax burden, while the renter has taken none.)

Thousands of apartments were vacated by tenants who could well afford to own property. When their rent subsidy terminated, they quickly bought homes. These vacated apartments were then available for those families who had to rent.

CONCEIVED IN COMMUNISM, ENEMY IN WAR AND IN PEACE

Rent control is an arch deceiver. It froze out the veterans and those who most needed rental housing. It turned class against class. It killed freedom of contract. It made honest renters and owners dishonest. It took ample housing and quickly created a great maldistribution to fool and confuse the American people and make them believe they had a true shortage. Rent control has been an enemy of our Nation in both war and in peace.

Senator MOODY. Are there any other witnesses? If not, we will recess until 10:30 tomorrow morning.

(Whereupon, at 3: 50 p. m., the hearing in the above-entitled matter was recessed until 10 a. m., of the following day.)