you, and I agree with you, in this bill 7110, that I do not like myself, and that is the feature of it relating to putting the Government more into business. That is the feature on page 2, line, 3 where the Secretary of Agriculture would have power to make the selection. I think he should have power of approval. Now, the main objection that I have, and I think you have, to the Government making the selection is this, that if anything has to be referred to Washington for determination you would never get determination, or it would take so long to do it that the farmer would not get any results. Isn't that the trouble?

Mr. BROWN. I should say it was, yes; very much so.

Mr. CLAGUE. But as a matter of fact, could there be any objection to the Secretary of Agriculture approving the selection that this joint board made?

Mr. BROWN. Technically, of course, no. He has the right of approval now, because he has supervision now.

Mr. CLAGUE. Possibly that is true.

Mr. PURNELL. Has the administration ever called the attention of the old line companies to any complaints of unfair practices toward the cooperatives?

Mr. BROWN. There was a complaint in the Kansas City market that there was an alleged boycott.

Mr. PURNELL. Have you ever had any complaints from Chicago?
Mr. BROWN. There have been no formal complaints made.
Mr. PURNELL. Any informal complaints?

Mr. BROWN. Well, an inspector came to me perhaps a month ago and said that there was a case in which certain traders were not trading with a packer buyer who had bought most of his stock of the cooperatives. I looked into it and it seemed that this packer buyer discriminated against the old line commission men. He would go down and fill his order every day if he could, and then if there was anything else to buy he would come to the old line people. In two or three instances I think the old line commission men told him that as long as he was buying practically all of his stuff up there he might as well go and buy the rest of it up there.

Mr. DOYLE. Why did he buy his stuff principally from them, Mr. Brown? Was it because of a lower price, or what?

Mr. BROWN. Well, it is fair to assume, Mr. Doyle, that he would not go up there every day and throw most of his trade there unless he was getting a pretty big bargain. They don't do those things.

Mr. PURNELL. As a matter of fact, didn't he buy there because he had a larger volume of business to select from?

Mr. BROWN. No; because he had about 94 per cent of volume in the rest of the market to select from.

Mr. PURNELL. I had in mind hogs. I thought your percentage was a little low on hogs.

Mr. BROWN. In this particular instance it was cattle. You asked the question, Mr. Purnell.

Mr. PURNELL. Yes.

Mr. BROWN. There was some individual feeling, perhaps, but I can assure you, Mr. Congressman, that there is nothing that approached a boycott in the Chicago market nor has there ever been.

The CHAIRMAN. I believe you estimated the cost of weighing and dockage at from half a million to a million dollars?

Mr. BROWN. I think it would range from half a million to a million in the 68 markets..

The CHAIRMAN. Can you give the number of scales in all the vards?

Mr. BROWN. I can not.

I can in Chicago, but not for all the yards. The CHAIRMAN. You said there were 10 in Chicago?

Mr. BROWN. I can get that and insert it in the record.

The CHAIRMAN. How many hours of service are required to do the weighing and docking?

Mr. BROWN. At the present time they start at 9 o'clock in Chicago and weigh until they are finished.

The CHAIRMAN. At what time do they finish?

Mr. BROWN. Well, days when they get 60,000 hogs in Chicago they very often weigh up to 7 o'clock.

The CHAIRMAN. In the evening?

Mr. BROWN. In the evening; yes.

The CHAIRMAN. Would that require more than one shift?

Mr. BROWN. I think the way they are working now, no; but under the Government you will see that that arrangement would hardly work out.

The CHAIRMAN. You would have to have one at each scale?

Mr. BROWN. Yes, sir.

The CHAIRMAN. One docker?

Mr. BROWN. Yes; and one weigher.

The CHAIRMAN. Do you employ more than one shift on the weighing?

Mr. BROWN. There has been some arrangement of that kind carried out, but as I understand it, the weighers stick right through now, and are paid, in Chicago, time and a half over the eight hours.

The CHAIRMAN. Can you conveniently give the number of scales and the time required for doing the work, so that we can make an estimate of the cost?

Mr. BROWN. You mean, will I furnish it later?

The CHAIRMAN. Yes.

Mr. BROWN. I will do that gladly.

Mr. JOHNSON. Mr. Brown, who hires the weigher?

Mr. BROWN. In Chicago the Union Stockyards Co.?

Mr. JOHNSON. What is the Union Stockyards Co.?

Mr. BROWN The company that owns the stockyards there.
Mr. JOHNSON. What relation do they have to the packers?,

Mr. BROWN. At the present time, as I understand it, the majority of stock in the Union Stockyards of Chicago is owned by a man by the name of Prince, of Boston. The packers may have some interest. That can be ascertained; but the majority of the stock is owned by a man outside of the packing organization.

Mr. JOHNSON. What relation has he with the packing organiza tion?

Mr. BROWN. He hasn't any, so far as I know.
Mr. JOHNSON. Is he related to it in any way?

Mr. BROWN. Not that I know of.

Mr. RUMBLE. May I ask a question, Mr. Chairman?

The CHAIRMAN. Do you yield to a question, Mr. Brown?
Mr. BROWN. Yes; I will answer the question.

Mr. RUBEY. Who is the gentleman who is asking the question? Tell us who you are for the purpose of the record.

Mr. RUMBLE. I represent the Central Cooperative Association of South St. Paul and the National Producers' Association of Chicago. Your remarks have not been addressed particularly to the Williams bill, have they?

no.

Mr. BROWN. I haven't said very much about the Williams bill;

Mr. RUMBLE. That is the bill which your organization is behind, isn't it?

Mr. BROWN. Well, we have favored two or three sections of it. Mr. RUMBLE. You drew the bill, didn't you?

Mr. BROWN. I did not; no.

Mr. RUMBLE. Do you know who did?

Mr. BROWN. No, sir.

Mr. RUMBLE. In some of your remarks you directed attention to the lack of responsibility of these cooperative organizations, and the only questions I care to ask of you deal with that matter.

Mr. BROWN. Yes.

Mr. RUMBLE. Do you know which is the largest cooperative selling agency in the country?

Mr. BROWN. I think the Central of St. Paul.

Mr. RUMBLE. Do you know whether that is a stock or nonstock corporation?

Mr. BROWN. I have been told that they have no capital stock. I am not an expert on that; I have never looked into it myself. I said that I was told that that was the fact.

Mr. RUMBLE. You do not know that that is a stock corporation? Mr. BROWN. I do not know; no.

Mr. RUMBLE. You do not know that it has a capital stock of $100,000?

Mr. BROWN. No, sir.

Mr. RUMBLE. But your statement was more or less to the effect that there was a lack of responsibility in these cooperative organizations?

Mr. BROWN. I was speaking generally; yes.

Mr. RUMBLE. You were speaking generally?

Mr. BROWN. Yes.

Mr. RUMBLE. There are many old-line commission firms that are private corporations, are there not?

Mr. BROWN. Yes.

Mr. RUMBLE. Do you know it is a fact that in many States a private corporation such as those can be organized and do business. after the issuance of three shares of stock, and after qualifying a board of directors?

am.

Mr. BROWN. I dare say you are more familiar with that than I I am not a lawyer.

Mr. RUMBLE. If the par value of that stock is $100, $300 would be the limit of the responsibility of that corporation, wouldn't it? Mr. BROWN. If there was such a corporation.

Mr. RUMBLE. It is a fact, isn't it, that all marketing organizations are bonded under regulations of the Department of Agriculture? Mr. BROWN. Our organizations are.

Mr. RUMBLE. All of them are, aren't they?

Mr. BROWN. I do not know.

Mr. RUMBLE. Don't you know that is the requirement of the department, that that be done?

Mr. BROWN. I think there was a bond question-there was quite a controversy in Kansas City about the form of bond that was entered into by the producers' association, so I was told, by those who attended the hearing; that it wasn't a bona fide bond or wasn't a bond approved by the Government.

Mr. RUMBLE. It was something they attempted to get the Government to approve, was it not?

Mr. BROWN. I don't know.

Mr. RUMBLE. I take it you don't feel that those bonds are large enough to take care of possible loss to the shipper, is that right? Mr. BROWN. I think they are based on the average business that a firm will do in a month, in a large month.

Mr. RUMBLE. Do you think they are adequate to protect the shipper?

Mr. BROWN. Well, they may not be on peak days. They would on 90 per cent of the days, however.

Mr. RUMBLE. Would your organization have any objection to issuance by the department of a regulation requiring all market agencies to pay by certified check?

Mr. BROWN. I don't think we would.

Mr. RUMBLE. You would not object to that.

Mr. BROWN. No.

Mr. RUMBLE. Why wouldn't that solve all the difficulty?

Mr. BROWN. That is a matter for you to take up with the depart

ment.

Mr. RUMBLE. I am asking for your opinion, if you want to give it. Mr. BROWN. Well, it would delay the return of money to a certain extent. A great many times now we make returns, and I presume you people do, before we get the actual payment on the stock. I think half the returns that our particular concern makes through the country are made before we make collections the next day. It wouldn't be hardly reasonable to argue that we should issue a certified check before we had received the money that the stock had sold for. Mr. RUMBLE. Now, Mr. Brown, the Central Association is doing about 30 per cent of the entire business on the South St. Paul Yards, isn't it?

Mr. BROWN. I don't know.

Mr. RUMBLE. That is approximately right, isn't it?

Mr. BROWN. I understood it was 27.

Mr. RUMBLE. Well, 27. It is also a fact, isn't it, that at the request of the Federal Department of Agriculture that association, for almost an entire month, paid by certified check?

Mr. BROWN. I don't know how they handled their business.

Mr. RUMBLE. Let me put it in this way: If the Central Association can pay by certified check there isn't any reason why any other association or any other marketing agency should not?

Mr. BROWN. Perhaps the central association did not remit until after they made collection. Many of the old-line commission concerns remit before they make collection.

Mr. RUMBLE. I should have said they paid by certified check on the day of sale. If they could do that any other marketing agency could do it, could they not?

Mr. BROWN. I should think so. Perhaps they could. We certainly can do anything you people can do.

Mr. RUMBLE. If that were done the shipper would be absolutely protected, wouldn't he?

Mr. BROWN. Unless the bank broke. now-a-days.

Plenty of banks are breaking

Now, just a moment, Mr. Chairman. We were given a specified amount of time. Mr. Boyd is going to follow me, and this gentleman is inserting in the record a lot of boosting for his own organization, which does not come along the lines of our testimony.

The CHAIRMAN. It is up to you, whether you yield or not.
Mr. BROWN. Then I am going to yield to Mr. Boyd.

Mr. RUMBLE. I am sorry, Mr. Brown, that you think that, because I haven't any intention of doing that.

Mr. BROWN. You can ask Mr. Boyd any questions you want to. Mr. WATTS. Mr. Chairman, I just want to say to Mr. Everett Brown that the cooperatives are ready at all times to cooperate with them on anything that is just and fair. I want to say to you that if you boys vote to accept his invitation to come to Chicago, I want you to feel that you are the guests of the cooperative marketing agencies just as you are of the livestock exchanges.

Mr. BROWN. You can't get away with that, Mr. Watts. If they come they come as our guests.

STATEMENT OF MR. JOHN S. BOYD, CHICAGO, ILL.

Mr. BOYD. Mr. Chairman and gentlemen, I am secretary and attorney of the National Livestock Exchange, with headquarters in Chicago. Since the enactment of the packers and stockyards act I have devoted a considerable part of my time to the packers and stockyards act, and by reason of that fact have had occasion to come into very close observation of the methods employed in its enforcement, its effectiveness, and also with the desirability or necessity of amendment of the act. I attended every hearing that was held when this law was passed, and with particular reference to section 306, and the bill introduced by Mr. Williams, 5944, I will say that it was the thought, as expressed to me by members of the committee at that time and since, that the language was intended to mean that all marketing agencies

Mr. RUBEY. What section is that?

Mr. BOYD. Section 306 (f) of the act, and page 4 of the Williams bill. As the language reads in the act at the present time it is the same as shown on page 4, lines 3 to 13, H. R. 5944. It was our thought that the language "nor charge, demand, nor collect a greater or less or different compensation for such services than the rates and charges specified in the schedules filed and in effect at the time; nor refund or remit in any manner any portion of the rates or charges so specified" meant that all market agencies engaged in selling livestock on commission in the stockyards of the United States would have to sell that character of market service and that the cooperative organizations, in accordance with the parenthetical portion of that