It is not uncommon to come to Congress when things dealing with the general welfare are concerned rather than dealing individually with 49 State senates.

I think you have made a very excellent statement. I do not know that I agree with it all, but I do not think that you statement warranted the working over you had on philosophy.

Mr. LOVELESS. Thank you, Congressman.

Mr. CURTIS. Mr. Chairman.

The CHAIRMAN. Mr. Curtis.

Mr. CURTIS. Lest the record will show the wrong impression, naturally those of us who asked questions of you have read the same things that my colleage, Mr. King, has read about.

The purpose of these hearings is to find out whether we can get together evidence that would substantiate or not substantiate those. That is one reason I asked the questions I did about Iowa, which is your State, as to what examples there were of losing business in Iowa to other States, because I wanted to find out, too, whether what we have read actually was true or untrue.

On the reapportionment problem, in order to bring that into perspective, of course I am well aware of that. I think everyone is. As my colleague from California stated, the issue, if we want to face the issue, is, do we solve the reapportionment problem by having the States help their own destinies in their own hands and grapple with the reapportionment problem. Or are we at the Federal level through various specific pieces of legislation such as this to solve the problem that only exists apparently because the States do have a reapportionment problem and are not reflecting, according to those who think it should be reapportioned evidently, the will of the people. That is the issue.

I can see in some instances where perhaps the Federal Government, because of an emergency or some other overriding reason, would say this is so important that we have to recognize that the States are not going to do it under the present apportionment systems they have. But would you not agree, Governor, the best way for Iowa to solve a problem where its legislature may not be reflecting the will of the majority of the people is by reapportionment rather than through a piece-meal process at the Federal level, have the Federal Government dictate because we can be so wrong at the Federal level as to what the will of the people is, much more wrong, I would suggest, than the people back in State legislatures, even though they may not be equally apportioned?

Mr. LOVELESS. If you gentlemen will permit me, this point of personal observation

Mr. CURTIS. I would like to hear it, because I think this does get to some of the meat of this problem.

Mr. LOVELESS. On the question of reapportionment that I brought into this discussion this morning, my only intent was to point out the reason that the States don't do these things. I think it is a problem of the individual States, the reapportionments, of their legislative assemblies.

Our constitution says they shall each be 10 years, but it stopped there without any qualification as to what would happen in the event they didn't follow through.

The problems of reapportionment will probably be solved with constitutional conventions in these individual States finally, because ideally we could say it rests with the States for a number of things, but as practical people we must suddenly realize the State legislative membership has no desire to take out of being a particular legislative area that they represent at the present time, and this is human. This is a human thing.

As a result, we can say that ideally this should rest within the individual States, and it does, this matter of reapportionment, but the matter of full employment, the matter of employment insurance, transcends the State border lines because in our economy of Iowa, if we were to try to exist as an individual State drawing a barrier around our State, with our whole economy based on the abilities of the people of New York State, and the people of Michigan, and so on to buy the products of Iowa's farms, we would be out of business real quick.

Mr. CURTIS. I agree, but this is a State-Federal system where we have had some minimum standards and then the States were to tailor to meet their needs, so it comes to a question of whether the tailoring has not been well done, and the argument is presented by you, and I think very properly, that one of the problems is reapportionment,

All I am saying is that not only does it apply to unemployment insurance, but we have this problem of Federal standards in many other areas, and I know you appreciate it.

Mr. LOVELESS. That is right.

Mr. CURTIS. It would seem to me in the long run we would do better by grappling with the real problem wherein some people say the will of the people is being thwarted by improper reapportionment of the State, rather than to really divest the States of this power and turn it over to the Federal Government where I suggest the representation of the will of the people is much more flimsy, I might state, than otherwise. That is debate.

The CHAIRMAN. Are there any further questions?

Mr. Knox.

Mr. KNOX. Governor, I do not feel that reapportionment really is the problem we are confronted with today. However, to get back to our State of Michigan, the voters of the State of Michigan wrote into the constitution the boundaries of the senatorial districts of our State. The people did that with full cognizance of what they were doing. Our Michigan House of Representatives was reapportioned on a population basis and I do not believe in that case that the people of the State of Michigan discriminated against the metropolitan areas, as the metropolitan areas voted for the boundaries of our State senatorial district into the Constitution.

Mr. LOVELESS. I am glad to hear, if you permit me, Congressman, that this was the action of the people. The folks out in my home State have not had an opportunity to vote on it for about 25 years. Mr. KNOX. They could make it available, could they not, by petition? Mr.LOVELESS. No.

Mr. KNOX. They cannot in the State of Iowa?

Mr. LOVELESS. No. It takes two separate acts of the legislature to make the question available to the people.

The CHAIRMAN. Mr. Alger.

Mr. ALGER. Governor Loveless, a gentleman from Kentucky appearing before us submitted some diagrams and charts pointing out to this committee that well over 50 percent of the unemployed were people without dependents.

In Iowa do you know what the percentage is of the unemployed drawing benefits, or in position to draw benefits, or of your total work force who are married, single, or with or without dependents, or seasonal workers, students, and so forth?

Mr. LOVELESS. Sir, I believe I could provide you with that. I am sorry that I don't have it.

Mr. ALGER. Mr. Chairman, if the record could be left open I would appreciate it because we do not have this information.

Mr. LOVELESS. We have rather a complete study on this that has been made in recent weeks, I might say.

Mr. ALGER. I certainly would like to have it.

The CHAIRMAN. Without objection, Governor, we will receive that information for the record at this point. (Information referred to follows:)

Mr. LEO H. IRWIN,

Chief Counsel, Committee on Ways and Means,
House of Representatives, Washington, D.C.

STATE OF IOWA,

OFFICE OF THE GOVERNOR,

Des Moines, May, 4, 1959.

DEAR MR. IRWIN: In reply to your letter of April 28 I am pleased to submit the following estimate of the dependency status of the Iowa labor force, for inclusion in the testimony I recently presented to your committee:

Single
Married

Estimated dependency status, per 100 workers in Iowa labor force

Children under 18 years of age (married workers):

None 1

2

3

4 or more__.

You will note that approximately 63 percent of our labor force would derive no benefits from the dependency provisions proposed for the unemployment compensation program in our State.

I might add that of married workers it is estimated that approximately half have working spouses and this would further limit the benefits to be derived from the dependency provisions in the proposed law.

The estimated dependency status given above is based largely on characteristics of the labor force nationally, rather than upon a direct sample drawn from the Iowa population. We do have available a sample of approximately 1,100 claimants for whom dependency information has been compiled. In order to make these available it will be necessary to retabulate the questionnaires, which will take a week or so to do. If the committee is interested in this, I shall be very happy to provide the additional statistics.

You are free to edit this material in any way you feel necessary, to place it in the proper context in my testimony.

Very truly yours,

HERSCHEL C. LOVELESS, Governor of Iowa.

The CHAIRMAN. Are there any further questions of Governor Loveless?

Again, Governor, let me express appreciation to you for coming to the committee and giving us the benefit of your views as the Governor of the great State of Iowa. Thank you, sir.

Mr. LOVELESS. Thank you, Mr. Chairman.

The CHAIRMAN. I see several of our colleagues here this morning. We will hear first from our colleague from Massachusetts, the Honorable Thomas J. Lane.

Mr. Lane, will you please come forward to the witness table? We appreciate having you with the committee this morning, Mr. Lane, and you are recognized.

STATEMENT OF REPRESENTATIVE THOMAS J. LANE, OF

MASSACHUSETTS

Mr. LANE. Mr. Chairman, the speed with which H.R. 5640 passed in the House was not only motivated by the need for extending temporary unemployment compensation beyond April 1, when the emergency program was due to end. It was recognition of a continuing problem that could become chronic.

With the recession of last year behind us, insofar as production and profits are concerned, it was expected that this improvement would be reflected in a sizable reduction of unemployment totals.

The large number of people who are out of work is a matter of deep concern to the Congress. As our work force is steadily increasing on the one hand, while the introduction of automation is shrinking the number of job apportunities, we face a widening gap that must be closed, if we are to avoid the burden of heavy unemployment in this country.

A reduction in the standard workweek but without reduction in pay, in order to spread employment opportunities, may be the required solution. Meanwhile, improvements in our unemployment compensation system are necessary to provide support for the displaced workers in our economy. We understand management's need to concentrate on production and profits. The object is to produce more goods with fewer workers. Automation has come along fast in 1957 and 1958. This has resulted in rising business activity that does not absorb the unemployed.

It, therefore, becomes the public responsibility, through the cooperation of the Federal Government and the States, to provide compensation for the unemployed to a greater extent than before, in the hope and the expectation that our growing economy will open up more job opportunities.

This is our major national problem. Until such time as private enterprise, with an assist from Government, can generate a sufficient volume of activity to create jobs, we have no alternative but to extend and increase unemployment compensation.

We cannot maintain our leadership if we resign ourselves a "split level" society in which the large majority of our people enjoy high wages, high profits, and a high standard of living, while 4 or 5 million adults are excluded from the opportunity to earn any income whatsoever.

The pressures and tensions inherent in this contradiction would seriously weaken our society because unemploymnet of this scope is both inhuman and wasteful.

The present hodgepodge of unemployment compensation systems in the various States, resemble structures that were built without de

sign. They encourage divisive competition among the States and encourage the migration of industry with its disorganizing effect upon industries, workers, and communities.

The plain fact is that the Federal-State unemployment compensation system has not evolved with the times. It did not anticipate automation and its effects upon the labor force. It has not caught up with the realities of today. Restrictions in the laws kept a padlock on the $7 billion in unemployment reserve funds during the recession. Some groups of hired farm laborers; 1.8 million employees in small firms; and others; have no protection whatever under the present jobless aid laws.

One of the most serious defects is that dependent benefits are provided in only 11 of the States. The failure to make any distinction between the needs of the single person who is unemployed, and the unemployed family man who has many mouths to feed, is both shocking and tragic. There is no excuse whatsoever for this appalling neglect.

To achieve permanent Federal standards and supporting State legislation, it is necessary for the Congress to be guided by "experience in the field" which points to the following needs:

1. That coverage should be expanded.

2. That the maximum duration of benefits should be increased to 39 weeks.

3. That the maximum of benefits payable under the law shall be an amount equal to at least two-thirds of the average weekly wage earned by employees within the State, or an amount (exclusive of dependent's benefits) equal to one-half of such individuals' average weekly wage, whichever is the lesser.

4. That an equalization fund shall be established to reduce the excessive costs of jobless insurance in those States that are suffering from heavy unemployment because of national economic conditions. 5. That the duration of benefits should be further extended in those States whenever the average unemployment within those States is in excess of 6 percent.

Much distress and bitterness have been caused by the overly strict and punitive requirements as to eligibility for benefits. Because an employee is partly at fault, is no valid reason why he and his dependents should be cut off completely from benefits.

It is advisable to moderate these requirements so that compensation may be denied in such State to any otherwise eligible individual only under the following circumstances:

For the first week of unemployment occurring within the benefit year.

For a period not in excess of 12 weeks immediately following the week in which he has been found, after an opportunity for a fair hearing, to have obtained, or to have sought to obtain, compensation by fraud, or willful misrepresentation of material fact.

For a period not in excess of 4 weeks immediately following the week in which he left suitable work without good cause, or refused to accept suitable work without good cause, or was discharged for misconduct in connection with his work.

Repeated renewals of the Temporary Unemployment Compensation Act meet the problem on an emergency basis only. They are not concerned with the basic improvement of the program through the addition of Federal benefit standards.