The CHAIRMAN. Then the repeal of the tariff on iron would expose the Pittsburgh market to competition with England on the higher grades of iron?

Mr. WEEKS. Yes, it certainly would on steel rails.

The CHAIRMAN. At what rate can steel rails be laid down at any port here from England with no duty on?

Mr. WEEKS. There have been some sales of English steel rails at £5 108. per ton placed on board the vessel alongside of the works. If they were taken as ballast, the expense of landing them in New England would be very small.

The CHAIRMAN. But, suppose they pay freight for them at the present low rate of freight. They could send them certainly at 58. a ton, but suppose the freight was 108. a ton, that would make them cost under $30 placed here.

Mr. WEEKS. Yes.

The CHAIRMAN. What is the present price of American steel rails?

Mr. WEEKS. Forty-one dollars a ton, depending something upon the location of the mill. I suppose the price would be $42 to $43 a ton at tide-water.

The CHAIRMAN. Now, to come to the countervailing advantages. Would it be to the advantage of any one to get steel rails at this low price?

Mr. WEEKS. It might be a temporary advantage to the railroad companies, but whether, on the other hand, if they could get them at these low rates, there might not be a worse side to the bargain, would remain to be seen. Of course if the Pennsylvauia Railroad Company bought its steel rails abroad, the Cambria Iron Works could not make rails and would have to be closed.

The CHAIRMAN. The Cambria Iron Company could offer its laborers as cheap wages as the English laborers receive, and then it would not have to close its works.

Mr. WEEKS. We do not want to see labor so cheap as in England.

The CHAIRMAN. No matter about that. We must adapt ourselves to circumstances. We do not want to be poor, we want to be rich, but we have to accept the situation. Now, if the tariff were repealed, the Cambria Works could make steel rails as cheap as they are made in England, provided their labor was as cheap.

Mr. WEEKS. Yes. Everything else is as cheap. Coal is certainly cheaper; ore is about the same.

The CHAIRMAN. That would enable the Cambria Works even to pay a little higher for the labor than is paid in England. Would not the laborer here be able to get beef, pork, flour, and other necessaries of life cheaper than the laborer in England gets them?

Mr. WEEKS. That is a question. They would certainly at present be able to get their provisions cheaper.

The CHAIRMAN. Would not everything equate itself very rapidly? There would be certainly an interval of great distress, but would we not all come down to a lower scale equal in purchasing power?

Mr. WEEKS. But the question would be whether that would be well or not.

Mr. JONES. Farmers complain of the high freights eastward. Would not the cost of freight be reduced?

Mr. WEEKS. I do not know very well how freight can be reduced when it is now only one-third of a cent per ton per mile on some classes of goods.

The CHAIRMAN. The railroad companies could afford to do it at less than half that rate, could they not?

Mr. WEEKS. I do not know.

The CHAIRMAN. Have you any other facts to give to the committee in regard to the question of arbitration?

Mr. WEEKS. I was going to speak especially of the trades in England, in which there seems to have been a great deal of trouble in the past, and in which these difficulties are entirely overcome by arbitration. I refer to the hosiery trade and the pottery trade. The hosiery trade is a trade in which the styles are constantly changing. There are changes in the number of picks or threads, and with every change there is a change in prices. This had made the hosiery trade (up to 1860) a trade in which there were constant strikes. It has been in that respect probably one of the worst trades in the whole of England. It is the trade in which the crime of maching-breaking (Luddism as it is called) was originated, and which gave the crime its name. I think that early in this century (about 1816) that crime was made punishable by death, and six men were hanged in Nottingham for breaking frames. This is the trade in which the first board of arbitration was established by Mr. Mundella, nineteen years ago next March. From that time to this there has not been a strike in that trade, and yet the wages and price list covers over five thousand different articles. They have fixed the prices of wages on these five thousand different articles, and the necessities of the trade are such as to require them to be changed almost every day. So in the pottery trade. The styles are constantly changing. There are many customs which have grown up and have almost the force of law. One of the questions, for example, most bitterly fought in the trade was, whether the potters should be paid for the pieces that were perfect as they came from their hands from the wheel, or whether they should be paid for the pieces that were

perfect as they came from the oven after being baked. The principle was called "good from hand and good from oven." It was a very bitter fight. Arbitration was adopted in this trade some thirty-six years ago, before Mr. Mundella's board was established. It was not a permanent board, but was called together at the beginning of the year for the purpose of establishing prices for the year. All the troubles they have are settled by arbitration, and there has not been a strike in that trade for thirty years, owing to this principle of arbitration.

Some member of your committee has asked me in reference to the legality of arbitration. There are two systems of arbitration advocated in England. One is purely voluntary; the other, which is known as Mr. Kettle's system, or as the Wolverhampton system, gives a partially legal standing to the board of arbitration. The principle is an application of common law. Certain prices fixed and rules made, take the form of working rules. These are tacked up in a shop, so that every employee is informed that that is the contract under which he is working. The tacking up of the prices in a shop becomes of course notice to the workmen, and any violation of the contract can be enforced by law. So far as I know that is the only form in which the advocates of arbitration in England propose to make it in any way legal. There is a provision for the termination of the contract on giving certain notice. That notice in the Wolverhampton trade is two days, so that at the end of two days a man can withdraw from the contract if he chooses.

In regard to the method of procedure of these boards. In bringing a case before them for trial, they provide that there shall be no strike or lock-out. The boards will not take any action in a trouble where the men are on a strike or where the employers have locked them out. Then, before the question can be brought before a board of arbitration, it has to come before a committee of inquiry or conciliation. This committee endeavors to settle the trouble without bringing it before the board of arbitration, but in case it cannot do so, the question is brought before the board and the decision of that board is final. That is true of all questions except those that relate to future rates of wages. As a general thing these come before the in board in the first instance.

The CHAIRMAN. But pending a strike the board of arbitration will not meet. Mr. WEEKS. It will not meet during a strike. If there is a strike, and if the question is to be referred to arbitration, the first requisition is that the work shall be resumed. They will not arbitrate a case nor take the subject into consideration while there is any strike on hand. In the coal trade, arbitration has not been quite so suc-* cessful. For instance, from March, 1873, up to 1877, all the troubles that arose in the Northumberland coal trade were settled by arbitration or conciliation; but from that time to this the colliery owners have refused arbitration, and for this reason: In 1877 the employers demanded a reduction of wages. The men refused to concede it, and without waiting for the board to discuss the question (which they were bound to do by the agreement into which they had entered) the men struck. That strike lasted a number of weeks, and finally the men agreed to submit the question to arbitration. The umpire decided against the demand of the operators; that is, he refused to grant the demand which the employers made. But at the same time he recommended the men to do exactly what the masters demanded; that is, his recommendation overthrew his award. Shortly after that, the coal operators demanded another reduction of wages. The men proposed to arbitrate that, but the employers refused to submit the matter to arbitration. The men had first refused to arbitrate, and then when a new case came up the employers refused to arbitrate. They said to the men, "You refused to arbitrate; you went out on a strike, and while the umpire gave his decision against us, he by his recommendation to you virtually overruled that decision, and now we will not arbitrate." The strike lasted for a long time. It was for a reduction of 124 per cent. The coal miners finally agreed to take 10 per cent. and to arbitrate the other 24. The employers said "no, we will not do it"; and they finally won and the men went to work. I spoke to Mr. Burt, the secretary of the coal miners' association, when I met him one day in the House of Commons, and he made this remark to me: "Mr. Weeks, they have got the whiphand of us now, but we will soon have it of them." This trouble is only in the Northumberland coal trade. The Durham coal trade (which is a much larger trade than the Northumberland) has since March, 1872, settled its troubles by arbitration, and there has not been a strike in the trade. They settled their troubles by regular arbitration boards from March, 1872, to May, 1877, and then established a sliding scale. Between March, 1872, and May, 1877, wages were advanced 584 per cent., and since that time there have been seven reductions of wages under arbitration boards, bringing wages to a lower rate than ever before in that trade. The present scale was adopted in May, 1877, and was to be in operation for two years, and it is still in operation.

Mr. RICE. The result of this arbitration in England for a number of years past has been to bring about a reduction of wages, for the last three or four years, but not in the first instance.

Mr. WEEKS. That is where I think we may find the secret of the success of some

boards of arbitration. The first effect of many of the boards was to put up wages. I think that if abitration had begun on a falling market, and if wages had kept going down, the workmen would have soon become disgusted with it.

In the South Wales coal works there was a strike in 1875, lasting for seventeen weeks, in which it is estimated there was a loss of from three to five million pounds sterling. The result of this was to establish a conciliation board and a sliding scale, with a maximum and a minimum. That had been in operation for a little while (a couple of years) when some of the men got dissatisfied and demanded a vote of the miners to see whether they should throw over the conciliation board, and although at that time the reduction had been 30 per cent. from the highest point reached, the vote stood 18,375 for continuing the board against 8,334 for discontinuing it. The minimum price fixed by that sliding scale was reached some time ago, and the manufac turers called a meeting of the men and submitted to them the question whether they would not consent that the wages should go below the minimum fixed. The men consented to it. A few months afterward they consented to a still further reduction of the minimum, and a third time since then they have consented to another reduction. Now, I do not believe that under the old system of strikes and lock-outs they would ever have consented to that. Here was a point fixed below which wages were not to go, and yet three times the men consented to a reduction below that point.

The CHAIRMAN. Then, on the whole, your testimony goes to show that there is rather more disposition on the part of workingmen to listen to reason than there is on the part of the employers?

Mr. WEEKS. I do not know where my testimony shows that.

The CHAIRMAN. You say that the workingmen in South Wales have consented to a reduction below the minimum three times, whereas in the other case that you speak of the masters would not consent to arbitration?

Mr. WEEKS. That was after the men had first refused to arbitrate, and had then after a strike consented.

The CHAIRMAN. Then the men repented, and were willing to submit to arbitration! Mr. WEEKS. Yes; but it was after a strike, lasting for a number of weeks.

The CHAIRMAN. Nevertheless, they did repent, and were ready to go to work and comply with the conditions of the board of arbitration!

Mr. WEEKS. Yes.

The CHAIRMAN. Have you ever found any case in which the masters have voluntarily put up wages as these men in South Wales have voluntarily reduced the wages below the minimum?

Mr. WEEKS. There has been no occasion to do so since these boards have been established. There has not been that opportunity to try because the maximum has never been reached.

Mr. RICE. Do you not think that in this country objection to such a system of arbitration would come from the employers rather than from the employed?

Mr. WEEKS. So far as I recollect, the most strenuous objection to arbitration in Pittsburg has come from the employés. They were afraid, just as they were in England at first, that it would destroy their unions, whereas the result has shown that the unious are necessary to the successful working of arbitration. I have a letter here from Mr. Trow, secretary of what would answer to our boilers' union, and which is known in England as the National Amalgamated Association of Iron, Steel, Tin, Blast-furnaces, and other workers. It is a trade which, in 1875, numbered 35,000 members. There were in the union in connection with the North of England iron trade, 32 works and something over 1,900 puddling furnaces-not quite half as many as we have in the whole United States. I wrote to Mr. Trow asking for his views on arbitration. He responds in this way: "With regard to my views on arbitration, I believe that it is the only fair and honorable mode that can be adopted for the settlement of questions between capital and labor; that where both parties meet with an earnest desire for a fair and honorable arrangement, and discuss the various questions in dispute in a kind and conciliatory spirit, there is no fear of failure, but, on the contrary, the old feeling of mistrust and jealousy is banished and confidence in each other is established. The faults in connection with arbitration are when workmen come to the meeting jealous and suspicious, believing that employers are their natural enemies; and employers, by not conversing with delegates in a free and friendly spirit, foster this suspicion; and only under that action is there any fear of failure. Arbitration in England is regarded with great favor by workingmen, and only in a few solitary exceptions has it been refused or the awards rejected by workingmen. If you wish arbitration to be successful, employers must meet delegates in a kind and conciliatory spirit, so as to gain the confidence of workmen. Let this be done, and arbitration will prove successful-a blessing to employers and workmen."

The CHAIRMAN. Is not the first condition for successful arbitration in this country that employers shall not dismiss from their works men who have taken an active part even in strikes, taking the worst phase of them. Must not the employers shut their eyes to the fact that these men exist?

Mr. WEEKS. I think that to-day in Pittsburg it would be utterly impossible to run a mill if men should be discharged in that way.

The CHAIRMAN. But it was formerly done.

Mr. WEEKS. They tried to do it, but they could not do it to-day.

The CHAIRMAN. The men have got too strong?

Mr. WEEKS. Yes.

The CHAIRMAN. Then the employers have learned a lesson by another process which they should have learned by the process of reason?

Mr. WEEKS. I do not think that in Pittsburg employers have lately attempted to discharge men who have taken an active part in strikes, unless there has been actual personal violence or outrageous abuse.

The CHAIRMAN. Why not let the law take cognizance of that?

Mr. WEEKS. The law cannot always do it. In Pittsburg we have had something like a conciliation committee. Manufacturers would elect five or some number of men, and the workingmen would elect five other men, and these ten got together and spent hours and days and nights sitting and talking and discussing. There is a personal friendly feeling between the leaders of unions and the prominent iron manufactnrers of Pittsburg (although the manufacturers do not always approve of the methods of the unions).

The CHAIRMAN. Has there not been an improvement in that direction?

Mr. WEEKS. Yes. The leaders of the men have got to be a better class of men than they were formerly. They are a good deal more conservative than they used to be. In the organization of these unions in the first instauce a good many men were put at the head of them of whom the workmen themselves were afterwards ashamed.

The CHAIRMAN. If the employers had encouraged the organizations of workingmen, would they not have had better men much earlier?

Mr. WEEKS. I think they would, but I am giving my own opinion now, not the opinion of the manufacturers. I think that the manufacturers ought to encourage trade-unions, and that they should also have as strong a union among themselves. I believe that the only way to meet union is by union. Then they come face to face, and they know that strikes mean something, and the men will not strike if they can help it.

I have mentioned the coal trade in England. I ought also to mention that there has been arbitration in the lace trade, the nut and bolt trade, iron-stone mining, the chemical trade, the boot and shoe trade, and textile trades. That shows something of the range of arbitration in England.

The CHAIRMAN. In other words, you found that a substantially new element has come into trade-disputes in England-that of arbitration-and that it is working effectually and extending its area all the time?

Mr. WEEKS. Yes. Not simply arbitration, but voluntary, permanent boards of arbitration. It is voluntary, permanent, systematic. It differs from the conseil des prud'hommes in that it is purely voluntary; that there is nothing legal about it. It is systematic, and is entirely under the control of the men interested, without bringing in the state at all. I can hardly say, however, that it is extending at the present time.

The CHAIRMAN. Is there any country in the world where voluntary action can be more easily brought into play than in this country?

Mr. WEEKS. No, sir. We have not to get over the difficulties which they had to get over in England.

NOTE. The following testimony, taken in New York in August, 1878, having been temporarily mislaid, lost its regular place in this volume:

VIEWS OF MR. WILLIAM E. DODGE.

NEW YORK, August 22, 1878.

Mr. WILLIAM E. DODGE appeared before the committee by invitation.

By the CHAIRMAN:

Question. Please to state your residence.-Answer. 225 Madison avenue, New York City.

Q. Are you a merchant of this city?-A. Yes, sir.

Q. You have been president of the Chamber of Commerce?-A. Yes, sir.

Q. You have been largely engaged in enterprises and have been employing labor on a large scale all your life?-A. Yes, sir.

Q. Can you give the committee some idea of the number of men now employed by your firm, and of the enterprises in which you are directly engaged?-A. I should say at a rough guess 2,000 men aside from my railroad interests.

Q. You do not include in that number those employed in the Scranton iron-works in which you have an interest ?-A. No, sir.

Q. You speak only of those employed in works in which you have the controlling interest?-A. Yes; the number is about 2,000.

Q. How long have you been in business of this sort, employing men ?-A. I have been a merchant in New York for fifty-one years, and have been engaged in various manufactures for the last forty years.

Q. Have you had occasion during that time to investigate the condition of the laboring classes, and to understand what, in your judgment, promotes their improvement, and affects their comfort and happiness? Have you given attention to that subject?-A. I think I have, very carefully.

Q. At the present time do you think that the laboring class (we have to use this term very unwillingly, as it seems there is no other term found except that of non-capitalists for people who labor and work with their hands) is in much distress throughout the country?-A. There can be no question on that subject.

Q. There is distress?-A. Yes, sir.

Q. Have you any theories or ideas about the causes of the distress or what makes it greater at this time than at other times?-A. I asked to come before this committee as the president of the National Temperance Society of the United States. The vicepresident and secretary are with me here. And it is with particular reference to that matter that I should like to make my statement, and I will then answer any inqui ries of the committee. I wish to make a statement as to the influence of the manufac ture, sale, and consumption of intoxicating drinks on the labor question.

The CHAIRMAN. It is quite pertinent for you to specify any causes which you think affect the laboring classes, injuriously or otherwise. It is not for the committee to direct what course you shall take.

Mr. DODGE. I simply mention that so that the committee might understand why I dwell more particularly on that phase of the question. I may say that, from our earliest arrangement of manufactories in this country, I have made it a condition precedent in the various villages in which we are interested that no intoxicating drinks shall be sold within the circle of our employed men, where we own the whole land; and we have made it a condition with all our superintendents that if a man is addicted to the use of intoxicating drinks, after proper admonition, he is to be dismissed. The result is that we have invariably succeeded in having sober, temperate men; and, in our various manufacturing villages, the men themselves have prospered. They have become owners, generally, of the dwellings in which they live. Many of them have accumulated property, and the result has been (for the last forty years in which I have had experience) that the use of intoxicating drinks as a stimulant to promote strength is (as far as that is concerned) positively demonstrated to be a mistake, and that the men who let it alone are the men who prosper and are the best off. And there are very few in all the villages in which we are interested to-day who are out of employment.

The CHAIRMAN. In other words the distress which, you say, is very general in this country does not very seriously affect the villages where your works are located?

Mr. DODGE. That is so. I mean to say that, while our manufactures partake of the general depression of the country, that depression has not affected the employés so that many of them are out of employment. They have accepted the wages that our manufactories are able to pay, and have, many of them, savings laid up for such times as this; and so far as my experience goes, in all our manufactories in which we are specially interested there is no depression to-day.

The CHAIRMAN. To what cause do I understand you to attribute the exemption of your employés from the severity of the times among workingmen generally?

Mr. DODGE. I attribute it to the fact that they have abstained from the use of intoxicating drinks, and have saved the large sums that are usually expended for their

use.

The CHAIRMAN. In addition to the interdiction of the use of intoxicating drinks, have you introduced any other agency, such as provision for saving earnings, that are not usually found in a community?

Mr. DODGE. In most of our villages there are institutions for savings, and one great point with us has been to get individuals to settle down in those villages and to be come owners of property; and we have given them the opportunity of paying for the property in small sums.

The CHAIRMAN. In other words, you have given them facilities to purchase land, and to make payment in small sums?

Mr. DODGE. Certainly.

The CHAIRMAN. Have you been in the habit of advancing money to these people when they want to build houses?

Mr. DODGE. Not as a rule; but exceptionally, from the first.

The CHAIRMAN. You have encouraged them to invest their earnings in that way! Mr. DODGE. Yes; and we have encouraged schools, and every moral influence that

we could bring to bear on the good order of the community.

The CHAIRMAN. Is crime of common occurrence in those villages?