in one mine should live below a decent standard and another miner doing exactly the same kind of work in another mine should be able to live at a higher standard. There is a problem that the best minds in our institutions of learning and our industrial life will have to figure out. But the fact of the matter is, that the public, if it wants that service, if it needs the commodity produced, must agree and be willing to pay for that commodity. (Applause).

THE PRESIDENT: We would like to hear from some other volunteer on this subject. I think Mr. Gompertz is here, the President of the Builders' Exchange.

Remarks by Charles W. Gompertz

MR. GOM PERTZ: I came here tonight as a guest to listen, and not to talk; but I appreciate the opportunity to say a few words on what today is the most important thing in the public mind in San Francisco, viz., the so-called controversy of the building trades. I have listened with a good deal of interest to the remarks made by the speakers who represented the employer, employee and the public, and the thought expressed by one of the speakers of what constituted a fair arbitration is uppermost in my mind.

Everybody in this room who reads the papers, is undoubtedly aware that a dispute has arisen between the employers in the building trades, represented by the Builders' Exchange, and the employees represented by the Building Trades Council. This dispute culminated in a declaration of a lockout by the Builders' Exchange to take effect on October 7, 1920, which was only averted by an appeal from the Building Trades Council to the Chamber of Commerce to use their influence for an arbitration.

Three men of undisputed fairness were mutually selected by both parties, Archbishop E. J. Hanna, ex-Supreme Court Justice Max Sloss, and George Bell, Consultant Engineer. An agreement was then signed wherein this arbitration board were to act as a continuing board and were to settle all disputes that were now in question, or which might arise. This board was also given the widest latitude to go into all matters pertaining to the building trades as to wages, hours and working conditions from the standpoint of the employer, employee and the public.

This board handed down a decision, to which the building trades council took an exception, claiming that the board had not gone fully into these matters, and also claiming that the board has exceeded their

authority in granting a decrease of seven and one-half per cent. The board considered this appeal, denied the request and affirmed their award. The Building Trades Council then repudiated the award, which has resulted in the stoppage of all work in the building trades.

Arbitration is the only method known to avert industrial strife; and if, when the parties to any dispute violate the sanctity of an agreement by refusing to abide by the decisions handed down, it endangers our whole social system. This dispute is no longer one of the building trades; but one that concerns San Francisco; and every citizen should make it his business to take the necessary steps so that agreements of this kind must be kept.

Remarks by Edward F. Adams

MR. ADAMS: I do not want to say anything, and I am not going to discuss, only ask a question. All my life I have been both an employee and an employer, in a small way, and I never had any trouble in either direction, but it has brought to my attention certain aspects of the situation, one of which has not been brought out here, and I am going to ask a question about it.

If it should appear after wages have been agreed upon, that the public refuses to buy the article produced at a cost which involves social justice to the employee, what are you going to do about the employees of those concerns which cannot produce the article at the price which the public will pay if they pay the wages which social justice requires?

Mr. Mullen touched on that point in a little different form. That is the great problem. Mr. Mullen spoke of the marginal mines. The low cost mines can put the high cost mines out of business when business is slack and the demand for coal is light. It is probable that the United States Steel Corporation could put two-thirds of the independent concerns out of business, and still maintain dividends. Now, what are you going to do about the employees of the industries below the margin? If you put them out of business, then you have that additional unemployment on your hands? If you do social justice, when social justice runs up against the economic situation, what are you going to do about it? That is the great problem today. (Applause).

THE PRESIDENT: I would be very glad to hear from somebody who has a ready answer to Mr. Adams' question. (Laughter). Any other speaker ready to discuss it?

Remarks by Roy W. Kelly

MR. KELLY: Our friend of the Typographical Union raised a question a few moments ago regarding economic conditions in the coal mines in England which has a bearing upon certain industries in the State of California. We have certain basic industries which operate in small sections throughout this State. Some of those divisions cannot be made at certain times to pay an immediate profit. I refer to our lumber camps, to our canning operations, to our oil industries and other similar industries which are operated from a central point which have small divisions which cannot be operated to show a direct profit. Now, the question arises as to whether the conditions which surround the employment in those small divisions are such as to return to the worker not only a reasonable wage, but also reasonable sanitary conditions, good housing conditions and safety.

There are two or three things that every worker is entitled to besides a fair wage. Those things are of as much importance as a matter of justice, equally important as a matter of economy to the employer. In other words, if a division of a company in some part of the country is not paying a profit, the employer is going to consider very seriously whether or not he is going to put money into better housing and better sanitation. Those things cost a good deal of money in these times, and they will be considered very seriously by the management of any industry, it seems to me, when the matter of wages comes up.

Certain things should be considered. In the first place, if a business is going to run at all, a man who works has the right to a safe place of employment, has the right to surround his family with conditions that are sanitary; he has a right to a decent house to live in, a matter which must be considered in connection with wages provided that house is provided by the employing company.

Now, the man must inform himself as to his rights; there is something which I think he should do. I had occasion to spend a little time in a sheep herders' camp near one of our properties in the San Joaquin Valley, and if the management of that camp knew the conditions those men were living in they would not tolerate them. But certainly they were not informed of the facts. The conditions were not only unsanitary, but unwholesome in every respect. It is up to all working men to inform themselves as to the facts, and in the next place to adjust themselves to the conditions. I say furthermore that every employer has a right to information about the facts which affect the organization under his own management. Such matters as safety,

housing, sanitation and employment ought to be looked after by someone with more training and more effective power in the company than a division head or local superintendent, and brought to the attention of those who manage the business. The workman himself usually has no power to bring to the attention of the management the real information about the conditions.

I think our labor friends are justified in objecting to some of the abuses of arbitration. The facts regarding wages and working conditions ought to be so thoroughly known to the management that there would be no question in the minds of the management as to what they ought to do, and what the square deal should be to the worker. And then, the employee should be brought to the place where he has sufficient confidence in the industrial relations department or other department which collects the facts, so that he is willing to accept the findings without going to the expense of hiring someone else to gather data for him. The management should recognize the justice in those facts brought out, and act accordingly. The collection of such data. ought to be made a reasonable charge against the industry, and that ought to be taken into consideration when wages are adjusted. (Applause).

THE PRESIDENT: I would be very glad to hear from Mr. Lowry, of the American National Bank, who has been a member of the section and works with them.

Remarks by Russell Lowry

MR. LOWRY: A great deal of stress has been laid in this discussion upon the cost of living as it relates to the wages of labor. It seems to me that a great deal of the present confusion of thought comes from that very stress; because in the last analysis, the cost of labor, the wages paid must depend, not upon the cost of living, but upon the value of the thing produced. Labor cannot set up an arbitrary budget, a standard of living set by itself, and then say to society, "You have got to give me this." Labor has to take what the industry can afford to pay.

There is nothing more fallacious than this talk about a living wage. What is a living wage? Nobody can define it. A living wage for one man might mean a thousand dollars a year; to another man it may mean ten thousand dollars a year. If you mean by a living wage, that which will barely support human life, it is very, very small indeed. I knew three boys in the Argonne Forest who subsisted for three days on one can of salmon for each day. A can of salmon costs perhaps 25 cents and you would hardly call that a living wage.

The amount required to keep body and soul together is very, very small. So a living wage does not mean that. It means whatever a man has in mind, whatever he thinks he ought to have for his subsistence; and society cannot pay that in all cases.

After all, you can talk as much as you please about the cost of living and what labor should have and what the employer ought to pay. But the thing is going to be determined by nothing more than the law of supply and demand. Labor union carpenters may say, "We have got to have ten dollars a day or we will not work." Well, they quit work; but after a time, when they must work, they will take less than ten dollars a day. They will find themselves in exactly the same situation as the wheat growers up in the Northwest, in Minnesota and the Dakotas. They said, "We will not sell our wheat until we get $3 a bushel; wheat is worth $3 a bushel, and we will not sell it for less." So they went on what you might call a seller's strike, but after a time they had to sell their wheat, and they took about a dollar a bushel. You cannot get away at any time from that old law of supply and demand.

We are facing a situation in this country now where labor in some lines is getting more than the industry will stand. The railroad laborers say, "We are getting so much, and we are determined to retain it," and the railroads are losing money and some of them going into receivers' hands, and not half of them paying their operating expenses.

Well, there must be a readjustment somewhere, and what I expected to hear discussed tonight was, how that adjustment should proceed, because we will never get back to a normal condition of affairs until the deflation which has occurred in some lines takes place in all lines.

The farmer has been mentioned here, and that is a very pertinent case in point. The farmer is getting about 25 per cent more for his product than he got in 1914, and he is paying for everything that he has to use about 75 per cent more than he did. That is a situation that cannot permanently endure, because about 35 per cent of the people of the United States live on agriculture, and when those people find themselves deprived of income, or, at least, their income is reduced. in purchasing power, they cannot buy. And if they cannot buy, who is going to pay the high wages of the city, who is going to pay the high profits of manufacturers and jobbers? Those profits and those high wages will disappear, unless an adjustment takes place so that this very large buying element in our population can make full use of its spending power and come once more into the market.