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hearings will be devoted to receiving testimony from members of the National Association of Retail Druggists. This organization's executive secretary, my fellow townsman Willard Simmons, is an old and valued friend of mine. I have the highest respect for both Mr. Simmons and NARD.

May I invite your attention to the fact, Mr. Chairman, that June 19 next will be the 31st anniversary of the Robinson-Patman Act. It was a hard fought act. I don't know of any proposed act that received as much opposition from the people affected by it than the RobinsonPatman Act. Of course, we considered it an antidiscrimination bill, In other words, if a representative of the seller or manufacturer went into a town, and he sold to both little people and big people, then under the same terms and conditions he had to give the little man the same price, making allowance for certain things, like manufacturing costs and delivery only, that he gave to the large man.

It worked out remarkably well in many industries, and we are really proud of what has been done, although we are not satisfied with the enforcement we felt it required. It was often referred to as the "Golden Rule" in business, and I believe it was deserving of that label.

The National Association of Retail Druggists represents most of the 40,000 corner drugstores in the United States. It is the largest segment of small business remaining in this country. I know their losses have been many, but few in comparison to other groups of small businesses.

I believe it is the largest group proportionately, I am sure that is true, of any group of small businesses in the United States. They have been able to withstand the rugged competition of the national chains. It is a great tribute to them that they were able to do that. But they were selling something in addition to products in their drugstores. Most all of them are public spirited civic minded citizens in the community where they live and where they have stores. They have influence in every way in their communities, and they are looked upon as leaders.

Now the national chains, as much as they strive to acquire the same type connection with the local people, have never been able to do that so successfully as the members of the National Association of Retail Druggists. They are undoubtedly outstanding in that respect, and I am very proud of the job that they have done.

As one of the authors of the Robinson-Patman Act, I naturally have a continuing concern as to whether its provisions, which were enacted by the Congress to insure the equality of opportunity to compete for the Nation's small businessman, are being adequately enforced. We must keep the door of opportunity open for the small businessman.

At a time when conglomerate mergers, vertical integration, dual distribution, and increasing economic concentration provide new perils to the survival of smaller firms, it is of particular importance that "the Magna Carta of small business" be enforced in a manner that fully carries out the congressional intent of the bill.

While I do not wish to appear critical of the Federal Trade Commission or the work it is doing, I must say that at the present time it is my strong feeling that the Robinson-Patman Act is not being

enforced to the greater degree of stringency which present circumstances require.

The FTC majority, I am convinced, remains solidly behind the basic principles of this act. I am sure of that. But, I was frankly amazed last August when an FTC Commissioner devoted most of a 64-page speech to an attack on the Robinson-Patman Act. The major points of the speech were apparently drawn from the legal defenses put forward through the years by the principal violators of the act. At the time, I protested publicly and questioned the propriety of a member of the Federal Trade Commission so vehemently attacking a law which he is charged with administering.

Certainly such attacks on the act do nothing to enhance the public's confidence that the small businessman is getting the kind of protection he deserves from the regulatory agencies. Again, let me emphasize that this attack came from only one member of the Commission, and I am not implying that he speaks for a majority.

However, I am trying to reemphasize the need for greater vigor in the enforcement of the Robinson-Patman Act. This is an area that needs strengthening, not weakening.

As a result of my continuing scrutiny of small business programs as chairman of the Banking and Currency Committee and ranking member and former chairman of the House Small Business Committee, I have reached the conclusion that considerably more emphasis on Robinson-Patman enforcement is needed at the present time.

In many ways, we find ourselves today in a time of transition. As to many of the changes occurring, the American people and their Congress have clear choices to make as to the kind of society they wish to have the kind of economy they wish to support. There are those who argue that the small businessman cannot survive. That he is an anachronism. That he is slow and slothful and inefficient. I say to this subcommittee and I say to those critics that this is not true. The small businessman of America, and in many ways small independent druggists in particular, have shown a fantastic ability to survive and compete under the most adverse conditions, and the National Association of Retail Druggists is particularly outstanding in that respect. All that is required is that small businessmen be accorded equality of opportunity to compete. Fundamental to that right is rigorous enforcement of the Robinson-Patman 'Act.

The small businessmen who will appear before you in the hearing room today and the thousands of their colleagues throughout the Nation for whom they appear as spokesmen neither seek nor need any special right or privilege. Given equal opportunity they can well fend for themselves. But denied that equality of opportunity, there is no way the small business merchant can withstand the encroachment of giant competitors.

So it is that your consideration of their problems, and the actions that you or the House of Congress may take concerning the matter as presented to you, are not only in behalf of independent businessmen. The preservation of competition and the prevention of even higher levels of economic concentration are necessary to preserve the stability and the strength, and indeed the freedom, of our entire economy. These are goals designed to protect all of the people. These are objectives that are essential to the functioning of a free economy.

Contrary to some widely circulated propaganda, small business is not something out of the horse and buggy era. It belongs in the 20th century and it must continue. That is why your hearings here are so important to the entire country.

The small businessman is under attack on many fronts. His difficulties increase as the big corporations and monopolies get bigger and bigger. Recently, I noted that a grocery chain argued in an antitrust case in this manner: "The antitrust officials are thinking nostalgically of a bygone age of 'Mom and Pop' corner groceries." This is typical of the big chains' attitudes toward the small businessman.

Unfortunately, much of the growing concentration in our economy is going unnoticed in the press. Now, this is a shocking statement. Last year there were 2,400 major mergers of corporations. That figure represented 20 percent of the total mergers that have occurred since World War II. In other words, in over 20 years, that is 20 percent of the total mergers. Every day the financial pages of the newspapers report a new merger somewhere in the economy. This trend is growing fantastically and in my opinion threatens the very foundation of our economic system.

As chairman of the Banking and Currency Committee, I know that the concentration in the fianancial community is terrifically high. In fact, 100 of the Nation's 14,000 commercial banks control almost half of all the banking industry's assets and deposits. And 10 banks out of the 14,000 total account for about 25 percent of the demand deposits in the country.

And here is a statement that was published in a leading banking magazine recently. That out of the earnings of the 14,000 banks last year, 1966, 25 of those banks had about a half of the earnings of the entire 14,000. That shows the way concentration is growing by leaps and bounds in this country.

I can give you an instance where people couldn't get credit, because of concentration of banking resources. In my area, we had a good place for a steel mill. We had the ore, we had the coal that would make good coke. We had everything that it took to have a good steel mill there. Well, naturally, we didn't have much of a chance, but when World War II came on, I had a large map made of the Soo Canal. I pointed out to Mr. Jesse Jones and Franklin Roosevelt at a meeting in which the steel people were present too, that a well-placed bomb on the Soo Canal would put us out of business for 18 months at least, and of course, they all realized we should do something to have insurance against that.

Mr. Roosevelt spoke up and said we must have some insurance against that. We must build steel mills where we have available materials and the resources that will make the steel. And then, of course, we commenced making our case, and we did make a good case. But that was only after, my friend, that we had tried unsuccessfully to go through the banks and the insurance companies to get the money to build that plant.

We first started with our local banks, then we went to Dallas-lots of money there. Then the Dallas bankers joined us up to a point. We went to New York, and in the conference there, around this big, huge directors' table, there was a director representing United States Steel, one representing Bethlehem, one representing Jones & Laughlin, and all the big steel companies were represented at that board of directors.

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Do you think we had a chance? Of course we didn't have a chance, because they were not only not for us, they were against us. They felt like it would upset their freight rates down there about $14 a ton, and they didn't want that steel mill built, and we had no chance..

We went back, and Dallas is quite an insurance center-lots of money there. We got the help of some of the insurance people. We went to New York again. And around that big directors' table up there of the insurance companies there was still Bethlehem, United States Steel, Jones & Laughlin and all the rest. We didn't have a chance.

Then we came to Washington, D.C., and we took it up with the reconstruction finance corporation, and we secured $75 million in credit. And you know what happened in 20 years? The Lone Star Steel Co. that was built with that money has paid back more than $75 million in income taxes to the Federal Government.

In less than 20 years, the men who worked at that plant, and whose jobs were generated by reason of the activities of that plant, paid more than $75 million into the Federal Treasury in Federal income taxes. And the U.S. Government, the RFC, as agent, has collected back every dollar of that money with interest.

But did you know, my friends, that today there is no place in the United States for people to go and get big money, to go into competition with big concerns? There is no place to go. They are absolutely helpless.

There are hundreds of places in the Nation today where there are adequate resources to construct comparable and similar mills and properties to Lone Star Steel, but they have no chance to go and get that money. The money is not available. For obvious reasons, they cannot get it through regular channels. The regular channels through their interlocking directorships are not going to put in somebody in competition to their own people. They are just not going to do it.

The Government has made it possible for small business people to borrow comparatively small amounts of money to compete with other small businessmen only, but never, never have an opportunity to borrow a sufficient amount of money to compete with the big people.

Now I think that is closing the door of opportunity in the United States of America, and I think this committee, in going into these questions, can well afford to go into that particular one too.

For the past several years, the big banks have been conducting a massive assault on the antitrust laws. They have been besieging the Congress with efforts to gain complete exemption from these laws so they could continue a merger movement which would eventually wipe out all but the biggest banking institutions. In other words, they have carried on a campaign that local people have no right to know who owns the bank. Now personally, I think a community has lost a lot, if they lose the ownership of their local bank. I think local banks should be owned by local people who are known to the people in that community, and who operate primarily for the benefit of that community first.

The bank lobby thought they had this accomplished in the Bank Merger Act of 1966. You know when that bill passed, the bankers thought they were in heaven, that they had it all made, that they had no more problems. That a few people would soon own all the banks of the country, and then the Reserve System wouldn't mean much. They would just artificially create all the money they wanted, without any

obstacles of any kind, not even 3-percent reserves that they are requiring now on time deposits, where they can manufacture $33 to every $1 that they have in reserves, and the reserves are furnished free too. So they are not out anything.

However, I am happy to report that the U.S. Supreme Court, in a unanimous decision, ruled otherwise last week, leaving the banks under the full jurisdiction of the antitrust laws. That is one of the greatest steps that has ever been made in the history of the U.S. Government, and that is giving us notice that if we want to do something in other areas, the Supreme Court of the United States has indicated that they are for the people, the public interest, and that they will be on our side. I think we ought to pursue it now while the time is good.

But the assault on the antitrust laws and on such legislation as the Robinson-Patman Act continues. We can expect more and more well-financed campaigns against all these laws. For the sake of the country, I hope these attacks do not succeed.

A former Chief of the Justice Department's Antitrust Division, William Orrick, put the problem in these terms a few years ago:

Concentration of economic power has always been regarded as a threat to our most important social and political institutions.

And he went on to say:

*** Perhaps most important of all, Congress' dedication to antitrust goals as a means of preserving our way of life has always rested on its recognition that concentration of industrial power may lead to the police state. Can anyone doubt that the prewar experiences of Germany, Japan, and Italy have proven the wisdom of this Nation's concern over concentration of economic power?

Now then, my friends, we can either reach the police state through communism or through the Fascist type government. There is no difference between them really. The Communists are 180° over to the left. The Fascists are 180° over to the right. They meet at the same point, because they are the same. Each one is a dictatorship, nothing more, nothing less, and if we don't watch ourselves, we can reach the point where the police state will be a real threat, and we have some of the earmarks of it today.

Those are strong words, but I am convinced that they fit the situation.

I am also reminded of the words of one of our former colleagues on this committee, Estes Kefauver, who went on to such a brilliant career in the Senate. Estes Kefauver started on this committee. One of the first jobs that he received from the chairman of the committee was to conduct a study on economic power. He produced a volume of testimony that has been in the colleges and universities throughout the land ever since. It has been reprinted and reprinted, and Mr. Kefauver, of course, received the consideration that he was entitled to receive by reason of the great accomplishment of that one volume.

Senator Kefauver had this to say in one of the reports of the Small Business Committee:

Concentration is the very antithesis of the free enterprise system. It is a fundamental principle in America that the public interest is best served by the maintenance of competition and the prevention of the evils of monopoly. Economic Concentration leads inevitably to the elimination of small business, the disappearance of competition, the fixing of prices, the restriction of production, and the creation of unemployment. It causes an uneconomic allocation of

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