JUNE 10

"The Department announced that CCC 'authorized some additional purchase of storage bins to help handle CCC grain stocks, especially corn,' and declared that 'officials believe that only limited purchases will be necessary if farmers reseal considerable quantities of 1952-crop loan corn for another year and provide additional on-farm storage to handle the 1953 crop.'" (Press release.)

JUNE 14

"In their efforts to find a way out of the dilemma, grain traders were talking of the possibility the Agriculture Department would make loans to farmers on wheat stored on the ground. There has not been the slightest hint this will be done, but it has happened in the past." (Journal of Commerce, June 15.)

JUNE 15

"Wheat breaks 10-cent limit, tips other markets

"Yesterday's declines carried wheat still further below Government support price levels and, at the close, the final quote was approximately 65 cents a bushel lower than the Government-support price. Corn was about 20 cents a bushel under the support level. ***

"The Corporation (CCC) has been wrestling for some time with the problem of finding additional storage facilities and, while some progress has been made, the problem still is far from a solution." (Journal of Commerce, June 16.)

JUNE 15

"The Department held a meeting with bin manufacturers 'to survey the availability of materials for bin structures' and to distribute specifications for bins. Manufacturers 'were told by Department officials that a minimum quantity of structures would be purchased.'

"The figure was set at approximately 50 million bushels, which is expected to be adequate. Offers were to be received by June 24, and 'as many as possible of the structures are desired for delivery on or before July 31, 1953, and the remainder on or before August 15, 1953.'" (Press release.)

*

JUNE 15

"Wheat led a sharp downturn in commodity markets. * *For the first time since February 11, 1948, wheat futures in all United States markets tumbled 10 cents a bushel, the daily limit. **

"Weakness in wheat [was] again caused by expanded harvest of the 1953 winter wheat crop and concern over storage room. *

"Combines are now active in Texas and Oklahoma, and by the end of this week, harvesters will be active in southern parts of Kansas. Private reports from harvesting areas noted that wheat was already being piled on the ground because of a lack of storage room." (Wall Street Journal, June 16.)

JUNE 16

"A top Agriculture Department official called Monday's commodity market break disturbing, but he indicated the Government is contemplating no shift of policy because of current market activity. *

"I suppose that sort of activity is a natural reaction to the fact that winter wheat is moving into harvest at a time of already heavy supplies and a shortage of storage space,' said John H. Davis, president of the Commodity Credit Corporation, 'I rather expected something of this sort to happen in the commodity markets when the wheat crop estimate came out last week.'" (Wall Street Journal, June 17.)

JUNE 17

""The Department of Agriculture announced today that it will make emergency price-support loans on wheat stored on the ground in arid areas of the Southwest, where

""This action was taken in an effort to stabilize grain markets that have been declining because of a critical storage situation and shrinking export sales' [said John H. Davis, President of CCC].

“Davis said details of the ground-storage program have not yet been worked out, but that they should be ready by the end of the week.

"The decision to make loans on grain piled on the ground came as a surprise, because Davis said yesterday no changes were being contemplated in the Department's grain program.' (Associated Press news story in the Chicago Tribune, June 18.)

JUNE 17

"Wheat shot up the full trading limit of 10 cents a bushel at one time, but sold off on profit taking and more sober consideration as to the ultimate effect of new Government support action announced during the day. * * *

"The Commodity Credit Corporation had announced that the price-supporting loans would be made available to producers of supplies on the ground in the arid areas of the Southwest. Later it was realized that the CCC offer applied to only a limited part of the new crop, leaving the majority of producers ineligible for loans owing to shortage of storage facilities." (Journal of Commerce, June 18.)

JUNE 19

"The Department announced details of 'the special distress wheat loan program' for wheat on the ground." (Press release.)

JUNE 20

"I am amazed to discover that the Department of Agriculture only recently has taken cognizance of [the shortage of storage] and to date have taken no significant action to work out a solution. This situation has been foreseeable for several months and in sufficient time to initiate an orderly and adequate program for the protection of the grain producers of this Nation and to make available to them the benefits of price support which were designed by the Congress for this very type of situation.” (Letter to President Eisenhower from James G. Patton, president of the National Farmers' Union.)

JUNE 28

"Heavy shipments weaken wheat-Prices register more than harvesttime dip "CHICAGO, June 28.-Grain prices usually are lower at harvesttime, but are even more so this year because storage is filled to capacity and many farmers who usually store their wheat for the loan price are having to dump it on the market. *

"Wheat storage space in the Midwest is even more short than in the Southwest, where a lot of wheat had to be dumped on the ground.” (Journal of Commerce, June 29.)

JULY 2

"Why do Iowa Republican editors keep silent about the corn-storage problem? Of course, I know quite a few of them and know they believe anything that a Republican politician does is 'good,' but when their own 'bread and butter' is threatened I always thought they would take 'the hide off' as it were of someone. But only 1 or 2 have even mentioned the seriousness of the situation. "Too little and too late' seems to be popular in Iowa again." (The Parkersburg (Iowa) Eclipse.)

JULY 8

"The Department announced the awarding of contracts for the purchase of 89,405,475 bushels of grain-bin capacity. These portable bins are to be shipped 'during the next 2 months' to locations in 8 States." (Press release.)

NOTE. This is about double the Department's original intention, announced 3 weeks earlier. This schedule would put the last bin in place about September 8.

Mr. HUMPHREY. From that record, the administration stands indicted by the farm-belt press-the Republican press of doing too little, too late, to avoid undermining the effectiveness of price support for America's farmers.

There may yet be time to ease the situation on corn if there is the will to do it.

But, by all means, the price-depressing situation now confronting American farmers due to lack of storage facilities must not be allowed to continue. Now is the time to start looking ahead for next year instead of waiting until the last weeks before harvest. It is time more thought was given to the whole storage situation. Some of us must insist that the time to act is now.

Mr. President, I ask unanimous consent to have printed in the RECORD at this point an article entitled "Southern Minnesota Farm Income Drops," written by Alfred D. Stedman, an eminent agricultural reporter, and published in the St. Paul Pioneer Press of July 8, 1953; also an article entitled "Upper Midwest Shifts to Diversified Farming," written by Will Hertz, and published in the Minneapolis Tribune of July 5, 1953. I make note that Mr. Stedman calls our attention to the fact that net farm income is from 20 to 30 percent below what it was last year.

There being no objection, the articles were ordered to be printed in the RECORD, as follows:

[From the St. Paul Pioneer Press of July 8, 1953]

SOUTHERN MINNESOTA FARM INCOME DROPS
OFF 20 TO 30 PERCENT

(By Alfred D. Stedman)

On thrifty southern Minnesota farms grossing $15,000 to $25,000 a year, falling livestock prices and high operating costs

knocked net farm income down by 20 to 30 percent to less than $4,000 last year.

This was revealed Tuesday in accounting by economists of Minnesota University Farm and the United States Department of Agriculture.

The surprising declines were revealed on selected farms of farm management associations of southeastern and southwestern Minnesota keeping careful business records of all receipts and expenses.

To city people, the reports told that a high gross farm income running up to $25,000 on the farm doesn't mean much in the way of a net farm income which, after paying expenses taking up the bulk of it, may leave a net of only $4,000 or so to the operator in a rough year like 1952.

To the politicians, the extent of the farm income downturn in the presidential year stripped away the mystery of the huge political turnover in the farm vote in Minnesota as a sample of the farm landslide to Eisenhower.

To farmers, the reports demonstrated that even thrift and careful watching of expenses weren't enough to make a year like 1952 shine in respect to black ink on the farm ledger.

On 133 farms of 9 counties enrolled in the Southwest Minnesota Farm Farm Management Association, average net earnings fell 20 percent in 1952 to only $3,936 per farm, the accounting showed. At that level, the average was a little more than one-third the average net of $11,391 in the record income year of 1947.

Farms in southeastern Minnesota suffered an even larger drop percentagewise last year. On 170 farms in 14 counties in the Southeast Minnesota Farm Management Association, average net earnings after expenses declined 30 percent in 1952 from a record 1951 level. The decline was to a per farm of average net of $3,964, the lowest level since 1949.

EXPENSES SOAR

The great extent to which operating expenses have been eating into farm receipts, thus reducing the net that's left for the most thrifty operators, was revealed by the accounting.

In the southeast, of $19,194 total average farm receipts from all sources, including sales and living from food produced on the farm, expenses used up an average of $15,230. Farms enrolled in this farm-management project were in Dakota, Dodge, Freeborn, Goodhue, Le Sueur, Mower, Nicollet, Olmsted, Rice, Scott, Steele, Wabasha, Waseca, and Winona Counties.

In the southwest, total farm receipts averaged $25,804-of itself a drop of nearly $4,000 per farm from the year before. But farm expenses totaled $21,868 for the year, a drop of about $2,600. That left the average net per farm of only $3,936. The farms represented were in Cottonwood, Faribault, Jackson, Martin, Murray, Nobles, Redwood, Rock, and Watonwan Counties.

Increases in costs of labor, taxes, insur

ance, feed, and upkeep of machinery figured in rising expenses. The drop in beef cattle changed a profit of $84 per animal to a loss of $43 in the southeast. And in the southwest, it cut the return above cost from $130 per animal in 1951 down almost to $30 per head in 1952.

reporting service on the top 10 States last year in 16 kinds of crops, livestock, and livestock products.

Of the 160 places (10 for each of 16 crops), Minnesota, Wisconsin, North Dakota, and South Dakota captured 41. The year before they took 37.

Last year Minnesota placed in 15 categories: First in butter; second in oats, flax, rye, hay, and eggs; third in corn, barley, durum wheat, turkeys, and milk; fourth in chickens and pigs; fifth in soybeans; and eighth in potatoes.

It came close in one more-12th in sheep and lambs. In wheat, its old mainstay, it ranked 18th.

Wisconsin placed in 10 categories: 1st in hay and milk, 3d in oats and butter, 6th in rye, 7th in flax, 8th in corn and pigs, 9th in potatoes, and 10th in chickens.

South Dakota placed in seven categories: 1st in rye, 2d in durum wheat, 3d in flax, 5th in oats, 8th in barley, 9th in corn, and 10th in pigs.

North Dakota placed in seven categories: First in flax and durum wheat, second in barley; third in wheat, fourth in rye, and seventh in potatoes and butter.

In addition, on January 1, 1953, Minnesota placed 8th in cattle and calves on farms, 2d in milk cows, 5th in hogs, 4th in chickens, and 12th in sheep and lambs.

Wisconsin was fifth in cattle and calves, first in milk cows, and eighth in hogs. South Dakota was 10th in hogs and 11th in sheep and lambs.

In total cash receipts last year, Minnesota farmers ranked sixth with $1,300,656,000. Wisconsin farmers were eighth with $1,142,643,000.

Both North Dakota and South Dakota failed to make the top 10. North Dakota with $523,216,000 and South Dakota with $553,730,000.

In cash receipts for livestock and livestock products, Wisconsin ranked fourth with $1,007,714,000 and Minnesota sixth with $937,467,000.

Again the Dakotas failed to make the top 10. North Dakota with $174,616,000 and South Dakota with $375,332,000.

Despite their great crop diversification, all four upper Midwest States failed to make the top 10 in cash receipts for crops since most of their crops are fed to livestock on the farm.

Minnesota cash receipts for crops, for example, amounted to $363,180,000, or 28 percent of farmers' total cash income.

Crop cash receipts for the other States were Wisconsin, $134,929,000; North Dakota, $348,600,000, and South Dakota, $178,398,000.

ADM. WILLIAM M. FECHTELER,

UNITED STATES NAVY

Mr. BYRD. Mr. President, it is not unusual to find among the officers of our Armed Forces men of great ability and integrity. It is fortunate for the United States that men of character and courage will still devote their lifetimes as well as their lives to the service of their country.

This country now supplies a wealth of military leadership to the whole free world. The latest contribution we make is the appointment of Adm. William M. Fechteler to be commander in chief of the Allied forces in southern Europe.

It has been my pleasure to know our distinguished Chief of Naval Operations. I have heard him often in committee. He is not only a competent naval of ficer, but a powerful and able expositor. I have relied on his testimony and counted on his clear and forceful state

ments on legislative matters affecting the Armed Forces.

Admiral Fechteler is something of a naval tradition in his own right. He is the son of a distinguished flag officer. He is a pioneer in the field of joint command.

In several of the Pacific Ocean campaigns of the last war he was instrumental in the solution of sea, air, and ground problems involving forces of all services engaged in combat over wide areas. His foresight and resourcefulness in planning and in the direction of joint forces have been honored by his own and sister services.

In every naval assignment he has held those close to him acclaim his energy and firm, honest direction in every undertaking.

In yet another field, that of coalition planning, he has shown a skill in diplomacy equal to his naval forthrightness and compelling candor with the Congress.

When he commanded the Atlantic Fleet, just before becoming Chief of Naval Operations, he represented the United States on the North Atlantic Ocean Regional Planning Group. This was the early struggle to organize the defense of the Atlantic Community on the sea.

His service as Chief of Naval Operations most of you well know. The doctrine of readiness for combat has been furthered under his direction.

It is gratifying that he should accept the new assignment to duty he will perform overseas. It is also welcome recognition of his leadership for the North Atlantic Treaty Nations to agree to his appointment.

MESSAGE FROM THE HOUSE

A message from the House of Representatives, by Mr. Maurer, its reading clerk, announced that the House had disagreed to the amendment of the Senate to the bill (H. R. 4353) to increase farmer participation in ownership and control of the Federal Farm Credit System; to create a Federal Farm Credit Board; to abolish certain offices; to impose a franchise tax upon certain farm credit institutions; and for other purposes; agreed to the conference asked by the Senate on the disagreeing votes of the two Houses thereon, and that Mr. HOPE, Mr. AUGUST H. ANDRESEN, Mr. HILL, Mr. COOLEY, and Mr. POAGE were appointed managers on the part of the House at the conference.

The message also announced that the House had agreed to the amendments of the Senate to the joint resolution (H. J. Res. 228) to permit the entry of 500 children under 6 years of age, adopted by United States citizens while serving abroad in the Armed Forces of the United States, or while employed abroad by the United States Government.

The message further announced that the House had passed a joint resolution (H. J. Res. 305) making additional appropriations for the Department of Agriculture for the fiscal year 1954, and for other purposes, in which it requested the concurrence of the Senate.

HOUSE JOINT RESOLUTION

REFERRED

The joint resolution (H. J. Res. 305) making additional appropriations for the Department of Agriculture for the fiscal year 1954, and for other purposes, was read twice by its title, and referred to the Committee on Appropriations.

EXTENSION OF TIME FOR EXEMPTION FROM INCOME TAXES FOR CERTAIN MEMBERS OF THE ARMED FORCES

Mr. KNOWLAND. Mr. President, I move that the Senate proceed to the consideration of Calendar No. 613, H. R.

4152.

The PRESIDING OFFICER. The bill will be stated by title for the information of the Senate.

The LEGISLATIVE CLERK. A bill (H. R. 4152) to extend the time for exemption from income taxes for certain members of the Armed Forces.

The PRESIDING OFFICER (Mr. BENNETT in the chair). The question is on agreeing to the motion of the Senator from California.

The motion was agreed to; and the Senate proceeded to consider the bill (H. R. 4152) to extend the time for exemption from income taxes for certain members of the Armed Forces.

Mr. KNOWLAND. Mr. President, I suggest the absence of a quorum.

The PRESIDING OFFICER.

clerk will call the roll.

The

Mr. JOHNSON of Colorado. No; that was not the purpose of the Senator from Colorado. He merely wishes to have the bill considered so that he may offer an additional amendment.

The Government's own figures show that as far as the fur industry is concerned, they have reached a point of diminishing returns.

In my opinion, this is a case in which

Mr. JOHNSON of Colorado. And I have called up my amendment.

Mr. KNOWLAND. That is what I understood, but I also understood the Chair to say that the vote whereby the committee amendment was agreed to had to be reconsidered.

Mr. JOHNSON of Colorado. That was not my purpose.

The PRESIDING OFFICER. The parliamentary situation is that the amendment was ordered to be engrossed. The Senate is now reconsidering its action in ordering the amendment to be engrossed and the bill to be read the third time in order that the amendment offered by the Senator from Colorado may be considered. Without objection, the votes of the Senate in ordering the amendment to be engrossed and the bill to be read the third time are reconsidered.

The clerk will state the amendment offered by the Senator from Colorado.

The CHIEF CLERK. At an appropriate place in the bill it is proposed to insert a new section as follows:

SEC. 4. (a) The table contained in section 1650 of the Internal Revenue Code (relating to the war-tax rates of certain miscellaneous taxes) is amended by striking out the following:

The Chief Clerk proceeded to call the "2401---| Furs---| 10 percent---| 20 percent"

roll.

Mr. KNOWLAND. Mr. President, I ask unanimous consent that the order for a quorum call be rescinded.

The PRESIDING OFFICER. Without objection, it is so ordered.

Mr. KNOWLAND. Mr. President, a parliamentary inquiry.

The PRESIDING OFFICER. The Senator will state it.

Mr. KNOWLAND. As I understand, the unfinished business is H. R. 4152. The PRESIDING OFFICER. That is correct.

Mr. JOHNSON of Colorado. Mr. President, I call up an amendment to H. R. 4152.

Mr. President, a

Mr. KNOWLAND. parliamentary inquiry. The PRESIDING OFFICER. The Senator will state it.

Mr. KNOWLAND. Are there committee amendments to the bill?

The PRESIDING OFFICER. The committee amendments were agreed to yesterday. The first step in the procedure will be to reconsider the vote by which the committee amendment to H. R. 4152 was ordered to be engrossed and the bill to be read a third time.

Mr. KNOWLAND. Mr. President, is the amendment which the Senator from Colorado is proposing in conflict with the amendments which have already been adopted, or is the Senator from Colorado fearful that he might be precluded from offering his amendment unless the vote by which the committee amendments were agreed to is reconsidered?

“2401---| Furs---| 10 percent---| 20 percent" (b) The amendment made by this section shall apply only to articles sold on or after the first day of the first month which begins more than 10 days after the date of enactment of this act.

Mr. JOHNSON of of Colorado. Mr. President, the effect of the amendment is to reduce from 20 percent to 10 percent the retail excise tax on furs, terminating the war-tax rate. I am positive that my amendment will actually increase Govenment revenues, not from other or indirect sources, but from the actual collections under this tax itself. That may sound like doubletalk, but I am making the statement in absolute good faith and in all seriousness.

The Treasury Department's figures show that during the calendar year 1943, which was the last year the industry operated on the 10-percent rate, collections from the tax on retail sales of furs amounted to $52 million. During the calendar year 1952 collections dropped to $51 million. In other words, the Government is collecting less revenue today from the 20-percent excise tax on furs than it did 10 years ago, when the rate than it did 10 years ago, when the rate was 10 percent.

The record further reveals that during the fiscal year 1947 collections from the excise tax on furs reached a peak of $97.4 million. Since then collections have steadily declined, so that during the fiscal year 1952 only $51.4 million was collected, and estimates for 1953 are that $49.2 million will be collected, which represents a 50-percent decline in revenues from this tax since 1947, in spite of the fact that the tax rate has been increased.

But that is only part of the story. It just does not make sense, nor is there a legitimate reason or justification, to continue such an unwarranted tax to such a point that it is making a Government liability out of an industry. A study of the facts clearly shows that unless some immediate relief is given, during the next fiscal year the Government will have to expend as much money to the fur industry in unemployment compensation and other forms of relief as will be collected in taxes from the industry.

What has happened is simply that the public is refusing to pay an exorbitant tax for the privilege of owning fur products.

Though the retail price of furs has remained relatively steady, the consumerer's revolt against paying the tax has reduced the volume of sales of fur products to less than half what they normally were. The result is that over half the raw furs now being produced are being stored, 40 percent of the fur workers are receiving unemployment compensation or are working only part time, and the other branches of the industry are either idle or are operating far below normal capacity.

The industry is aware of the fact that its only possible chance of regaining its volume of business is to remove the obstacle that is causing the trouble by passing the tax reduction on to the consumer. With storehouses bulging with raw furs and 40 percent of the fur workers unemployed, fur prices will not rise.

What the industry feels it is entitled to is a tax rate under which it can operate at normal capacity, contribute a maximum of taxes to support its Government, and regain its position as an economic asset rather than be a liability to the Treasury and the Nation.

It is inconceivable that we would turn down the request of an industry that has the capacity and wants to contribute more revenue to the Government.

At a time when we are straining to balance the budget and need more taxes and are trying to reduce expenditures, most assuredly the problem of the fur industry merits consideration and action.

Mr. President, I ask unanimous consent to have printed at this point in the RECORD some supporting data which go into more of the details of this situation.

There being no objection, the memorandum was ordered to be printed in the RECORD, as follows:

SUPPORTING FACTS

Government statistics prove the fur industry to be in the most precarious and sick position of any industry whose products or services are subject to excise tax.

As there can be no better barometer than Government excise-tax receipts to reflect business activity, one need only take a quick glance at the attached table to see what is happening. Since 1947 the sales of furs has declined 48.2 percent.

Three general classifications are shown, including collections from (1) retail excise

Further evidence of the critical situation the fur industry is in is borne out by the following figures released by the United States Treasury Department on May 20, 1953.

Corporation income tax returns for the year 1950 covering the fur-manufacturing industry shows the following: Total number of returns filed, 1,017; number of returns showing net income, 523; number of returns showing losses, 494.

Though there are no available figures for 1951 or 1952, it is estimated that of the furmanufacturing firms remaining in business over 65 percent are operating at a loss.

The National Institute of the Fur Industry reports show that during the past 3 years over 400 firms in the fur manufacturing and

1947.

1948.

1949

1950.

1951.

1952....

1953 (estimate)_.

resenting losses of over $25 million.

It is estimated that 40 percent of the fur workers in the processing and manufacturing branch of the fur industry are out of work and receiving unemployment compensation.

Impact on the raw-fur industry is evidenced by the fact that the State of Louisiana, one of the largest raw fur producers, shows income to that State from sale of furs dropped from $15 million in 1946 to $2 million in 1952.

Warehouses are loaded with millions of dollars of raw furs deteriorating and rotting. This pathetic situation is entirely due to the fact that consumers refuse to pay a discriminate, exorbitant tax on fur articles.

Percent increase or decrease, 1947 to 1952.

rate

Mr. IVES. Mr. President, I desire to endorse everything the distinguished senior Senator from Colorado has just stated.

The fur industry in New York State, from the standpoint of the actual makeup of the furs themselves-in other words, the manufacture of coats, fur pieces, and so forth-is completely completely knocked out at the present time.

If this amendment is adopted, I hope it will go a long way toward reviving the fur industry in the United States. If it is not adopted the plight of the industry as a whole will indeed be very serious.

I myself have prepared an amendment identical in character to the one the Senator from Colorado has just submitted. Of course, I shall not submit mine, assuming that his is adopted, and I hope as strongly as I can that the amendment will be adopted and that the bill including the amendment will be passed.

Mr. KNOWLAND. Mr. President, I regret very much to have to rise to oppose the amendment submitted by the distinguished senior Senator from Colorado. This bill extends the time of exemption from income taxes in the case of certain members of the Armed Forces. Although it is quite true that under the rules of the Senate the amendment is in order, inasmuch as the pending bill deals with revenue matters, and was reported from the Finance Committee, I respectfully appeal to the Senate not to begin to add amendments to the bill, because, as a result of following such procedure in the closing days of the session, we might very well jeopardize the enactment of the bill. After all, if one amendment to deal with one tax problem is

added to the bill, there are undoubtedly other Senators who are familiar with other problems which to them are no less acute.

I have no question in my mind that the fur industry has many problems, and also that there are a great many other businesses in the Nation that have serious difficulties. However, it seems to me that at this late stage in the session it would be a very poor parliamentary practice to begin to add amendments to. the bill, if we wish to have the bill which has come to the Senate from the committee enacted into law.

In the first place, as I have pointed out, that would encourage the submission of a number of amendments on a multitude of subjects. In the second place, from the point of view of the time element, it would require a conference with the House, and the bill might very well become tied up in conference, because of honest difference of opinion on the part of the House and the Senate. Finally, if the bill were to be loaded down with amendments, so as to become an omnibus bill, it would be very likely that the President would not approve it.

So I appeal to the Senate to pass the bill as it has come to us from the Finance Committee, without additional amendments.

Mr. KILGORE. Mr. President, will the Senator from California yield for a question?

Mr. KNOWLAND. I yield.

Mr. KILGORE, I feel that there are certain discriminations against the fur industry and against various other industries. But does not the Senator from California feel that matters relating to

excise taxes should be taken up one by

one, and that each should be studied on its own merits, before we either repeal or continue the tax? Does not the Senator from California agree as to that?

Mr. KNOWLAND. I fully agree with the Senator from West Virginia on that point. It seems to me that cases can be made for the giving of relief, but that each case should be taken up on its own merits, and that we should not proceed to add amendments of that sort to the pending bill, with the result that the bill would become an omnibus tax bill.

Mr. KILGORE. Let me say to the Senator from California that the interpretations of the existing tax laws have been rather discriminatory in some ways, because of poor delineations. For instance, in the case of the luxury tax, we find that because a fur collar is added to a cloth coat, the coat is taxed as a fur coat. Does not the Senator from California think that a legitimate question arises as to what should be taxed in that respect?

Mr. KNOWLAND. Yes; I think there is merit in what the Senator from West Virginia has said.

Mr. JOHNSON of Colorado. Mr. President, will the Senator from California yield to me?

Mr. KNOWLAND. I yield.

Mr. JOHNSON of Colorado. Does not the Senator from California realize there is great difficulty in regard to such matters? The Senate cannot originate revenue bills; the Senate has to wait for revenue bills to come from the House. About the only opportunity we have to take care of such tax problems is to add amendments to the revenue bills which the House passes and sends to the Senate.

I think it is not difficult to show that the fur industry is being taxed out of business. Existing statistics easily demonstrate that fact.

If, under the Senator's theory, all tax matters were considered in one bill, and if all tax-relief proposals were considered in another bill, that would be much more convenient, and might be a better way to legislate. But the Senate does not have such a choice. The Senate has to do the best it can with what it has to deal with.

The amendment I have submitted has received consideration by the Senate Finance Committee. I do not think there is one member of the committee who is not very sincerely and deeply impressed with the distress of the fur industry, largely because of the exorbitant tax of 20 percent, which causes great sales resistance-so much so, that furs simply are not being sold.

Of course, other excise taxes are a burden, too. In a short time we shall deal with another measure relating to another excise tax, namely, the theater admisison tax. That proposed amendment to the excise tax law comes to us as a single bill.

The members of the committee and other Members of the Senate have been urged not to load down that bill with amendments. Let me say that I have sufficient confidence in the committees of conference and in the individual conferees on the part of the House and in the individual conferees on the part

of the Senate to believe that they will Ideal on the merits with any problems which come before them. I do not think we have to use an exact mold in regard to conference committees. The conferees of both Houses are able men. They can handle whatever the House and Senate pass on to them.

So I do not think we are doing anything extraordinary or out of the way in giving to the Senate an opportunity to correct a very great wrong, which is the purpose of the amendment, and our hope in connection with it, and to correct it in the interest of the Treasury of the United States, as well as in the interest of a great industry.

Mr. KNOWLAND. I may say to the distinguished Senator that I know the deep sincerity with which he presents

his amendment. As I said in the beginning, there is no question that he is entirely within the rules of the Senate in so doing. There is much merit in what he says, since, under the Constitution of the United States, the Senate cannot originate tax legislation. As all Senators know, revenue legislation may be originated only in the House of Representatives. I am very hopeful that, early in the next session, a bill dealing with some of the inequities which the Senator has mentioned will come from the House in the regular order, and will reach the Senate early enough in the session so that the Senate Finance Committee, of which the distinguished and able Senator is a member, and an active member, will have an opportunity not only to consider the bill, but to conduct hearings for the purpose of taking the testimony of those who feel that additions, amendments, or corrections should be offered to it. So I raise no question in that regard.

I speak merely as the acting majority leader, in what we hope is about the last week of the session. The problem raised by beginning to add amendments to the pending measure or to some other revenue bill is that if one amendment were added, it would open the door, in my judgment, so that additional amendments would then be offered, and in the final analysis we would jeopardize passage of the bill.

The bill now pending, as the distinguished Senator knows, and as I pointed out before, deals with the extension of time for exemption from the payment of income taxes for certain members of the Armed Forces. The present law will expire on January 1, 1954, if not extended. If the bill were not passed, the exemption applicable to men who fought in World War II, or the men who are in Korea today, would be removed before the Congress met again and had a chance to act on the question.

So, I plead with the distinguished Senator and with other Members of the Senate, that under the circumstances they not start loading up the bill with amendments. I say that in the utmost sincerity, because I do not for one moment question that the distinguished Senator from Colorado has a very real knowledge of the problem, or that the industry affected by the amendment he has offered is in a serious condition, and

is in need of relief. To express a personal opinion, I hope that when the bill to which I have referred is before the Senator's committee early in the next session, the matter will then be given attention, and that the Senate will be able to act on it at an early date in the next session of the Congress. That is the basis of my position. It is not a matter of opposition to what the Senator is trying to achieve. I do not deny that the difficulties to which the Senator has referred are facing the fur industry. Mr. JOHNSON of Colorado. President, will the Senator yield? Mr. KNOWLAND. I yield. Mr. JOHNSON of Colorado. The

point I desire to call to

Mr.

the attention of

the Senator once more is that there are

conference committees. The House has its representatives on conference committees. In this instance the conference committee will take into consideration the nature of the bill, and will take into consideration the nature of the amendment, as well as the urgency of the bill and the urgency of the amendment. We have to trust the conference committees, particularly with respect to revenue legislation, since the Senate is restricted in the handling of revenue matters, and can only amend revenue

bills which come from the House. That is the only way the Senate can proceed in such matters.

No one questions that the chairman of the Committee on Finance is an able man, and it seems to me he would be able to handle this matter in conference. I should like to make a plea to the chairman of the Finance Committee to take the amendment to conference.

Mr. KNOWLAND. Mr. President, I do not speak for the distinguished chairman of the committee, who is the colleague of the senior Senator from Colorado, but I respectfully must say that because of the problems which I believe could be presented if one amendment were accepted, I think the chairman of the committee would be in a most difficult position when other amendments were offered with respect to other industries or groups that may also feel they should be afforded relief. To them their problems To them their problems may be as great as the problem which, as the Senator from Colorado has pointed out, those engaged in the fur industry face.

He would be in a very difficult position if he should accept the amendment of the Senator from Colorado and not accept other amendments when others felt their others felt their cases were equally strong. So, even if the chairman of the Finance Committee were inclined to accept the amendment, I must say in all fairness that I would feel obligated to urge the Senate to resist taking the amendment to conference.

Mr. SCHOEPPEL. Mr. President, will the Senator from California yield?

Mr. KNOWLAND. If the Senator wishes to speak, I yield the floor.

Mr. SCHOEPPEL. I should merely like to say to the acting majority leader that I recognize the merits of the position taken by the distinguished Senator from Colorado; but I desire to proceed in the spirit of the remarks of the distinguished acting majority leader.

I may say very candidly that as a result of the last severe flood which occurred in my State, which went on down the Missouri Valley and down the Mississippi Valley, hundreds and hundreds of thousands of gallons of gasoline were destroyed. I have been importuned most earnestly by many independent dealers and retailers who had paid a tax on that gasoline to present, at the earliest possible opportunity, an amendment or some other legislative measure to obtain relief for them.

As I said, I wish to go along with the spirit in which the acting majority leader has suggested we approach this particular measure, but I must say in all candor that if amendments are offered to this measure, and their proponents are successful in having them considered and added to the pending bill, I shall be constrained to offer an amendment in furtherance of the relief of those who lost property in the flood to which I have referred.

Mr. KNOWLAND. I may say to the distinguished Senator from Kansas, I have been told by perhaps a dozen Senators on both sides of the aisle that they have amendments which they feel are also meritorious. They were inclined not to offer them, but they have indicated that if the door were once opened, they would feel it necessary to do so.

As one who comes from the far West, from the State of California, I may say to the Senator that our people feel that there is great discrimination in respect to the transportation tax, as one example, and with respect to the communications excise tax. They say that when a citizen of a nearby State, let us say a citizen of Pennsylvania, Delaware, or Maryland, desires to come to Washington for the purpose of presenting his case, it involves a relatively small expense, if he uses public transportation. The excise tax on such transportation means little. But if a citizen of the Pacific Coast States or the Mountain States who has just as great an interest about legislation pending in Washington, feels that he should come here, the transportation tax places a cumulative burden on him out of all proportion to the tax paid by a citizen from a nearby State. That is also true if a person living in the West wants to telephone his Senator, or desires to transact business between the East Coast and the West Coast, by reason of the difference in distances. The penalty of a tax of that type bears more heavily, the further one is away from Washington, whether it is in the communications field, involving the use of telephone or telegraph, or in the field of public transportation. A number of Senators have told me that if any amendments are adopted with respect to this bill, they will feel, in order to prevent gross inequity, that amendments should be offered by them. I, personally, would like to see relief from such taxes afforded as rapidly as possible, and under normal circumstances, I would feel that I should both support and vote for such an amendment. But, in view of the situation which prevails in the Senate, I must say that I would have to resist an amendment of that