Evening star., 1941-09-19
Defense Lag Blamed
By Arnold on Both
Industry and Labor
Powerful, Selfish Groups
Restricting Production,
'Anti-Trust Chief Says
By the Associated Press.

By the Associated Press.
YOSEMITE, Calf, Sept. 1e.-Or-
ganized basic industries have been
restricting defense production in
order to avoid prospective over
production after the war, Thurman
Arnold, Federal antitrust enforce
ment officer, told the California Bar
Association today.
For 10 months, Mr.. Arnold as
serted, defense work has been ham
pered by powerful private groups,
including "a few strategically-
located labor unions" working for
their own selfish motives.
The industrial groups fear expan-
sion of production, he said, because
it may destroy their domination of
industry after the war. - They
have concealed shortages by over
optimistic predictions of supplies"
Huge Cost to Public Cited.
THE labor union restrictions,
which have nothing to do with
wages, or hours or conditions of
labor, are today costing the Ameri-
can consumer over $1,000 OOO, 900 a
year." Mr.. Arnold declared. The
cost is increasing
Il am not talking about wages. I
am talking about holdups and bot
tlenecks in housing and in food. and
in fuel and in transportation. They
are created by powerful labor unions
which claim the legal right to in
stitute strikes and boycotts for the
following illegitimate objectives: To
enforce e-fixing agreements and
free channels of distribution, to
eliminate small competitors and
owner-operators, to restrict the use
of labor saving devices, to keep more
efficient materials off the market
which might interfere with static
jobs, to prevent self employment, to
make arbitrary classiflcations of jobs
which retard the efficient use of
labor, to tie up huge industries in
the struggle to determine which of
two unions will dominate the field"
Mr.. Arnold said these corporations
and organizations were not unpa-
triotic but had trained themselves
to resist the development of new
enterprise"
England's Waste" Recalled.
They are obsessed with the idea
that overproduction will interfere
with their future domination" he
said.
While they are willing to expand
their own war production, they do
not want others to expand. and they
reserve the right to dictate to civ
ilian consumers what they can buy
and the prices which they can pay.
In dealing with the anti-produc-
tive ideas of these groups we are
only repeating the experiences of
other democracies which prior to
this war had gone long way down
the path of static cartelization of
industry. England, because of this
set of ideas, wasted all the precious
months before the fall of France"
The antitrust official charged
that during the last year the lead
ers of our basic industries have
been demanding that priorities be
used, not to expand production, but
as an excuse not to expand it."
Threat to Small Business"
Mr.. Arnold contended that the
awarding of huge defense contracts
to relatively few large industrial
organizations, leaving smaller firms
without priority standing and un-
able to get raw materials for civilian
production and also unable to OBJ
tain subcontracts for making defense
materials was threatening to cause
the disbandment of thousands of
small businesses.
Whether they ever can come to
life again is doubtful" he added.
The loss to national defense is
irreparable."
Mr. Arnold said the imposition of
price control would not work ef-
fectively if costs were raised by
artificial restrictions. He declared
that the building industry was en-
meshed by these, and that monopoly
and private pools were taking ad-
vantage of a golden opportunity"
to raise prices for food in large
cities. q,
Attorney General Francis Biddle
said today he had no doubt the
Government would maintain "our
essential CONSTITUTIONAL liberties"
regardless of the severity of the
crisis through which the Nation may
have to DaSS,