Evening star., 1934-05-21
Recommendations X
Aduanced for
Code Changes.
BY the Associated Press.

DOdIO "ClC uColIlUCu III yOuI OL0CE
as follows:
I'D To ascertain and report to
the President whether any code
or codes of fair competition ap-
proved under the authority of Title
] of the National Recovery act are
designed to promote monopOlies
or to eliminate or oppress small
enterprises or operate to discrimi-
nate against them, or will permit
monopolies or monopolistic prac-
tices, and if it finds in the affirmi-
tive to specify in its report where
in such results follow from the
adoption and operation of any
such code or codes.
"(2) To recommend to the
President such changes IN any
approved code or codes as, in the
opinion of the board, will rectify
or eliminate such results"
First Hearing March IS.
Pursuant to the executive order.
the board assembled on March Z, be-
gan at once to receive complaints,
and held its first hearing on March
is.
The board now has 304 complain
ants awaiting hearings. Their COM
plants concern lO4 codes. One hum
dred and thirteen complaints have
already been heard. against 18 codes.
OF these which have been heard, re-
ports are included herein concerning
the following:
Electrical manufacturing, footwear
division, rubber manufacturing, mo-
ton pictures, retail solid fuel, steel,
ice. cleaning and dyeing, bituminous
coal.
The hearings on the following
codes have been held but drafting OF
the recommendations has not been
completed:
Petroleum, lumber and lum yer
products, wood case lead pencil, as
bestos, motor vehicle retailing, saw
and steel products.
At the hearings, every opportunity
was afforded for the presenting Of
every phase Of the subject under in
quiry, the interests involved were no
titled through the Code Authority,
many witnesses we're heard, counsel
was allowed to present arguments.
Only one industry, that OF motion
pictures, declined to avail itself Of
these facilities until after the hear
ing had been concluded.
Synopsis Presented.
The board respectfully begs leave
to submit the following synopsis of
reports in connection with codes in
dicated:
Electrical Manufacturing: The mo-
nopoliStic conditions existing in this
industry do not result from the code,
but from the control of patents and
other long standing factors. Ninety
three per cent of the incandescent
lamp division OF the business is. and
long has been. in the hands of one
corporation. No evidence was pre-
sented that would justify the board
in formulating any decision in regard
to the possible oppression Of small
enterprises.
1t is, however, true that the code
authority, or what corresponds there
to, is composed of members of the Ma
tional Electrical Manufacturers AS
sociation: and no provision is made
for the representation Of manufac-
turerS that are not members of that
association. We deem this to be
wrong. and recommend that it be cor
rected.
Footwear Division, Rubber Manu-
featuring: Small enterprises In this
industry are oppressed under the code
in ways that will result in monop-
oily, if one be not already created.
The industry is composed OF IL
companies, of which two, with their
affiliates, represent 65 per cent OF the
total production.
Large Firms Benefit.
This code was made by the large
companies for their benefit and Tor
their benefit it is administered. AS
a result, the smaller enterprises have
refused to assent to the arrangement.
The divisional authority which has
direct supervision over this branch OF
the rubber industry is composed OF
three men that represent and have
interests in the large companies.
The powers vested in the divisional
authority include the power to class
ify goods, determine discounts and
fix prices.
The divisional authority has used
the compliance provisions of the code
as a threat to coerce the small manu-
facturer into submission to code re-
ouirement injurious to the small en-
terprise.
The price-fxing arrangements maze
by the divisional authority are likely
to put the small enterprise out Of
business. These arrangements IN
clude discounts on large purchases
that small manufacturers cannot give;
discount practices that the small en-
terprise cannot meet and other dis
advantages.
New Authority Recommended.
We recommend that the present
divisional authority be displaced and
a new authority be created fairly
representative of the small enterprise
as of the large; that each member OF
the division shall be allowed to COM
pute his cost pursuant 10 tne SysIeLii
provided in Article VIA, Chapter l.
report such cost to an impartial
agency selected by the divisional au-
thority. and shall not thereafter sell
any product other than factory dam
aged or obsolete goods for less than
cost.
Motion Pictures: Monopolistlc prac-
tices in this industry are bold and
aggressive and its small enterprise
is cruelty oppressed.
The industry includes the making,
the distributing and the exhibiting in
theaters of film pictures. The pro-
ducing and distributing is chiefly in
the hands of eight powerful COM
panies. commonly known in the busi-
ness as the big eight"
There are in the country 1881
theaters, Of which 4,800 are desig-
mated as circuit or chain theaters
OF these circuit theaters 1854 are
affiliated with the big eight COM
panies and 2,846 are not so affiliated
There are left 1851 theaters that
are classified as independent.
1t appears that the code for this
industry was made by representatives
80 Tho Ia roo y,ro6urjnO c0n1naniPS ID