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EXHIBIT 18

Ralph J. Cordiner, Chairman of the Board
General Electric Company

To Economic Mobilization Conference
American Management Association
May 20, 1958

Second, there has been orderly planning by General Electric managers

to try to minimize unemployment and keep production as steady as sales and forecasts would permit. Our managers are human, and some of them have naturally made mistakes or bad guesses, but they have tried to keep the employees and their community neighbors as fully informed as possible on the changing necessities of the economic situation. In addition to its efforts to build sales back to the levels that would sustain higher levels of employment, the Company has urged the states to consider extending the duration of unemployment compensation during these periods of higher-than-normal unemployment, as well as an improvement of the level of benefits where appropriate. Such extended benefits on a state insurance basis, rather than a federal dole basis, should be urged by every businessman.

Third, the necessary inventory adjustments are being carried out in as rapid and yet orderly manner as possible, to minimize both the length and the intensity of the adjustment period.

Fourth, General Electric's research and development expenditures have been continued unabated, so that the new products, new industries, and new jobs of the 1960's will not be delayed. The Company's research and development expenditures in 1958 will again amount to well over 6 percent of sales, which is three times as high as the average for all industry.

Fifth, the Company's long-established program of recruiting, developing, and training scientists, engineers, business and liberal arts graduates is continuing. General Electric, with its force of 20,000 scientists and engineers, is one of the nation's most important sources of advancing technology. This

EXHIBIT 21

GENERAL ELECTRIC

EMPLOYEE RELATIONS NEWS LETTER

For Circulation Among General Electric Management

May 5, 1954

The so-called

"GUARANTEED ANNUAL WAGE”

Demand

One of the eleven demands made on us two weeks ago by IUE-CIO was for the so-called "guaranteed annual wage." We are giving below the background of some of the information and initial conclusions which we ha developed in our prior experience and continuing studies and which we are currently discussing with the

As

you doubtless have noted in the various.reports, the details of this proposal are practically the

had seen widely publicized by the union since last fall. They are the same as those

the first of last month- as confirmed both by the press accounts

its Westinghouse demands, which the union gave us at the

The leading steel, rubber and meat packing year. The automobile lead

This is

ment among some with higher skills and longer service, it would seem appropriate now to consider the fairness of extending the limit upward, at say 50 per cent of pay to some appropriate new ceiling with proper cligibility requirements to protect against abuses that are already serious and could get worse if benefits were raised without adequate safeguards.

2. Proper Unemployment Pay When There is No Work

Our objectives here are to cooperate with the publicthat pays the bill-in seeing that we do our part in having our and other workers, who are on short-term® layoff, get state unemployment compensation benefits that are supplied through employers and that are fair and feasible and high enough to properly aid the unemployed --and, at the same time, low enough to make it sumciently more attractive to work than not to work. In a more serious and long-lived unemployment situation, our ob jective would be to cooperate, as citizens, in aiding the establishment of whatever was the proper direct arrange. ment between unemployed and public.

Our practice in this area is to cooperate in keeping the state unemployment compensation systems properly fruitful and sound. We have in these systems a guaranteed income plan on practically 4 universal basis. It has worked surprisingly well for 18 years. It has never had the test of a serious depression, but it has been constantly improved and will be under examination for further possible improvement at almost every session of every state legislature.

If there is anything seriously wrong with this guarantee system, we should fix it-and not wreck it in favor of privately negotiated, discriminatory plans that would favor only a few people temporarily and only then on the basis of the passing strengths and weaknesses at a few bargaining tables.

But the solution of our larger problem of steady work and a rising level of living for all-including those involuntanly out of work-is dependent on two forces on the positive side rather than on the negative or simply corrective side "after the fact."

One is helping promote steadily mounting progress in economic well-being and human welfare by means of all feasible intensifying of the innovation, improvement, expansion and promotion of products and services for which a market exists or can be profitably created. We will continue to do our best

in this area.

The other force is that of learning the economic and moral facts of our freedom and well-being. This is necessary in taking intelligent action at work, the grocery, at the voting booth, at the directors' meeting, in the union hall. It is necessary to our being able and willing to give, get and use the good buying and selling information which will guide into the sounder buying and production practices that will regularize jobs and serve the best interests of all. Here again, we are determined to continue our best efforts to that end.

us

The CHAIRMAN. I ask unanimous consent to include in the record a telegram addressed to me from Mr. Harold C. Hanover, president of the New York State AFL-CIO in support of the position taken by Mr. Carey in favor of H.R. 3547.

Is there objection?

The Chair hears none.

(The telegram referred to follows:)

Hon. WILBUR D. MILLS,

Chairman, Ways and Means Committee,
House of Representatives, Washington, D.C.:

NEW YORK, N.Y., April 14, 1959.

Because of circumstances beyond our control, unable to appear before your committee April 16 to give testimony on H.R. 3547 (S. 791) providing Federal standards in unemployment insurance compensation. We would appreciate the inclusion in the record of the support by the New York State AFL-CIO of this legislation. It would correct inadequacies in present State laws by estab lishing uniform minimum standards to be met by the individual States; and by establishing a system of reinsurance which will aid depleted State reserves. This bill will provide needed higher benefit rates, needed permanent extension of duration of aid, will make reasonable and uniform the eligibility requirements, provide better financing. The need for uniform Federal standards in this area has been recognized by the Federal Advisory Council on Employment Security, by the Rockefeller Bros., report, by the Governors of several States and by many economic authorities, including Arthur F. Burns, president of the National Bureau of Economic Research, the standard in this bill on the benefit amount is the formula recommended repeatedly to the States by President Eisenhower in his economic reports.

HAROLD C. HANOVER, President, New York State AFL-CIO.

The CHAIRMAN. Mr. Blatnik, our colleague from Minnesota, could not be here. He asked permission to file a statement. Without objection that will be placed into the record.

(The material referred to follows:)

STATEMENT OF REPRESENTATIVE JOHN A. BLATNIK, OF
MINNESOTA

Mr. BLATNIK. Mr. Chairman, like so many Members of Congress who believe that our unemployment problems will not cure themselves, I am here today to urge enactment of my bill, H.R. 3552, which is the same as the legislation introduced by Representatives Karsten and Machrowicz of this committee.

This legislation, as you are aware, would require that State unemployment compensation plans provide weekly benefits equal to at least 50 percent of a worker's average weekly wage, but in no case more than two-thirds of the average weekly wage for all covered workers in the State. Such a requirement would have the effect of raising maximum benefits in every State and of raising the benefits of a worker earning average wages in 1958 in 44 out of the 51 jurisdictions.

My bill, like most of the other bills before you, would require that all eligible unemployed be entitled to at least 39 weeks of benefit. The Temporary Unemployment Compensation Act of 1958, which expires completely this June, is convicing proof of the need for a Federal standard as to duration of benefits.

Mr. Chairman, I am convinced that we cannot continue to blow hot and cold on this matter of the kind of unemployment insurance system we need for the families of America. One day we are told that

unemployment is a serious problem which calls for emergency action. The next we are assured that there really is no problem-or at least that the problem will disappear if we just talk about it. I, for one, am convinced that we cannot dismiss a situation in which 4,360,000 Americans are out of work, and the rate of benefit exhaustions continues at just under 200,000 a month.

Most of all, I believe that we must look at the long-range picture of what has happened, and what is happening to our country in regard to unemployment. To this end, I would like to quote some very disturbing figures assembled by William Haber, Fedele F. Fauri, and Wilbur J. Cohen, of the University of Michigan, showing the impact of the 1957-58 recession on Americans workers and their families. According to this study:

Eighteen percent of all families in the Nation had one or more family members unemployed during the 12-month period prior to October 1958.

The average duration of unemployment was 18 weeks for individuals who experienced some unemployment in the previous 12 months.

For those who were unemployed in October the average duration of unemployment was 26 weeks; 42 percent of this group had been unemployed more than 26 weeks.

An estimated 12 million different persons experienced a period of unemployment during the 12 months, October 1957-58. This compares very roughly with the 9.8 million different persons who were unemployed during the year 1956, according to the U.S. Census Bureau. The recession thus had the double effect of increasing the number of unemployed as well as lengthening the duration of unemployment.

In my own State of Minnesota some 13,000 workers would have exhausted their temporary unemployment insurance benefits if Congress had not acted just prior to the Easter recess to make a brief extension of that very temporary and very limited program. Around 8.8 percent of the workforce of our State is currently unemployed and in the Duluth-Superior area, which I represent, the figure runs as high as 14 percent. Most revealing of all, perhaps, is the fact that Minnesota has the largest relief rolls since 1942-for these programs are the first to reflect the point at which benefits stop.

Frankly, gentlemen of the committee, I cannot reassure the unemployed families in my district with the prospect that things may not be quite so bad next September. Nor can I reassure myself that the 3-month windup of the present temporary loan program is any kind of an answer. For it is, to my mind, an aspirin approach which assumes that if the pain can be relieved a little, the total problem will disappear. However, we are not dealing with a hangover-rather we are dealing with a condition which is growing and deepening. The causes of the sickness are complex and include automation as well as the migration of industry. The Federal standards as to benefit amount and duration contained in my bill will maintain purchasing power during layoffs, and provide the worker and his family with the type of protection which was envisoned by the Congress when it passed the Social Security Act in 1935.

As to the problems which the States have in financing good programs, H.R. 3352 will also make reinsurance grants available to those which have been hard hit by the present recession. It recognizes the fact that unemployment is a national problem which cannot be met effectively if those State systems which try to do an adequate job are allowed to go broke. Last year 6 of the State systems facing heavy

unemployment almost went under, 2 of these States borrowed money under the Reed fund provision, and 17 States became obligated under the Temporary Unemployment Compensation Act. To suggest to these States that their problems can be solved by further loans and mortgaging employer tax rates is shortsighted and unrealistic.

The grants under the Federal standards bill would be limited to three-fourths of the excess by which benefits exceed 2 percent of the State's taxable payroll. In other words, the grants would only be made where unemployment benefits could not be financed by a 2-percent contribution rate, and the State would still be required to finance one-fourth of the benefits paid above this amount. As a safeguard against any possible abuse, the bill specific that no State will be eligible if, after 1961, it levies a minimum employer tax of less than 1.2 percent at a time when its fund balance was below 6 percent of the most recent annual taxable payroll or the amount of unemployment compensation paid from the fund during the 2 preceding years, whichever amount is greater.

The total problem we face was, in my judgment, well and succinctly stated in an address in Duluth by I. W. Abel early this month before the district 33 steel workers conference when he said:

The working force is increasing at a rate of 1 million a year and about 112 million workers are being replaced every year by modern technology. *** The (unemployment) problem must be met now. Unemployment breeds more unemployment because people without jobs can't buy the products of those with jobs.

I feel confident that the members of this committee are as concerned as I am with finding the best answer to this new situation in which pockets of unemployment are developing in the midst of plenty. And I feel confident you share with me the conviction that America will find a better way to provide for its unemployed.

The CHAIRMAN. Mr. Blatnik, we thank you, sir, for coming to the committee and discussing these problems with us. You have made a very fine statement. We appreciate it.

Mr. BLATNIK. Thank you, Mr. Chairman.

The CHAIRMAN. Any questions?

The CHAIRMAN. Our next witness is Mr. Frank E. Cooper of the Michigan Employers' Compensation Bureau and the Michigan Manufacturers' Association.

Would you identify yourself for the record, please? We know of your experience before this committee.

STATEMENT OF FRANK E. COOPER, COUNSEL FOR MICHIGAN MANUFACTURERS' ASSOCIATION AND MICHIGAN EMPLOYERS' UNEMPLOYMENT COMPENSATION BUREAU

Mr. COOPER. My name is Frank E. Cooper. I wish to thank the committee for this opportunity to appear before you. I am an attorney engaged in the general practice of law in the city of Detroit, and serve as counsel for the Michigan Manufacturers' Association and the Michigan Employers' Unemployment Compensation Bureau.

I appear on behalf of those two organizations this afternoon. I have filed, Mr. Chairman, a rather lengthy statement which is entirely too long to read in the 20 minutes that have been allotted to me. If

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