Peer-Southern Organization which is an independent music publishing firm. It was founded by my father some 50 years ago and is now headed by my widowed mother. We were pioneers in American country music. We helped bring Latin music to this country and we are now working in popular and symphonic music as well.

I take great pride in our work, in discovering, encouraging, and nurturing composers, promoting their works around the world, obtaining multiple recordings of their works, safeguarding their copyrights, representing them in negotiations with record companies and with others. I feel that we are making a real contribution to the enrichment of American culture. As a young man, I look forward to a lifetime in this business, fulfilling our responsibility to American music and keeping our company independent of the large conglomerates.

Frankly my future depends upon what you gentlemen decide. The bill you are considering will probably govern music copyrights for the rest of my life. Although record company opposition has apparently ruled out the concept of the percentage or royalty ceilinglike those adopted in most of the other countries in which my company is active at least the concept of the copyright tribunal in the pending bill gives me some hope that the ceiling on our earnings will not be frozen for another 66 years.

But the starting place for that tribunal will be the ceiling you place on the bill. If you fail to adjust it for these last 10 years of inflation I doubt that the tribunal will do so. If you fail to provide for a fair ceiling for my negotiations with record companies, then no amount of determination or bargaining skill on my part can obtain for our composers the level of incentive they need and deserve if they are to continue their creative activities.

Put yourself in my shoes. As publishers go, we are relatively large, but compared to the market power of the four or five record giants, we are minuscule. When they make me an offer which is below the statutory ceiling, frankly, I can rarely refuse it. They simply tell me that the package they are putting together will exclude our company and our composers entirely unless we accept their terms.

If they are anxious to get a particular song or composer, I can at least make counterproposal but I can never ask for more than the statutory ceiling, no matter how good the song is, because a record company can always get it for 2 cents. Frankly, we are sometimes passed by altogether because I will not accept an unjustly low rate. for our composers. But usually we end up agreeing to a rate below the ceiling in order to have our music included.

Do you understand the position I am in? On the lower end of the scale, I am faced with a buyer's market in which the thousands and thousands of songwriters and publishers compete to provide the lowest bid for a handful of powerful record companies. The statute imposes no floor, no minimum, only a maximum.

But in those instances where we might have some bargaining power, where we might have a song or a writer that is very much in demand, there Congress has cut off the law of supply and demand and inter

vened on the side of the record companies to say that we cannot ask for more than 2 cents per song.

This is not fair. If there must be a ceiling, it at least ought to be high enough to let us do a little bargaining when we have a great song. How else am I to meet my responsibilities to American music? How am I to encourage our writers to keep on writing and improving if the royalty per record, regardless of whether the song is trash or treasure, can be no more than 2 cents or 3 cents. When I represent these writers and their works in Europe, the royalty ceilings are generally 8 percent of the list price, which would be about 5.5 cents if it were in effect here. Why should they receive worse treatment at the hands of their own Government?

In conclusion, I ask you to remember that you are setting a ceiling on our negotiations, the upper limit, not a minimum or a fixed rate. We seek the right only to bargain on behalf of our composers when the song or situation warrant it. The higher the rate that you set, the closer we will be to a free market where actual payments will reflect true market values.

Remember, finally, that a good song is the key to a successful record and to the success of the record industry. If we are to encourage real quality and variety and creativity in American music, do not trample over our songwriters. Turning them off in the long run will be bad for everyone connected with music, including the record companies. I hope you will set a new ceiling that recognizes these facts. If you do, the composers and music publishers and music lovers throughout the country will be most grateful. Everyone will benefit.

Thank you.

Mr. DANIELSON. Thank you, Mr. Peer.

We will now move on to Mr. Marvin Hamlisch of the American Guild of Authors and Composers who is recognized for 21⁄2 minutes. The time is 14 minutes before 12.

Mr. HAMLISCH. Good morning.

TESTIMONY OF MARVIN HAMLISCH, AMERICAN GUILD OF AUTHORS AND COMPOSERS

Mr. HAMLISCH. I speak as a composer. I hope that I am the fellow that Mr. Pattison referred to when he said we need someone who is able to do something about the mechanical rate.

I waited a long time in my life to get a hit song. Every songwriter writes many songs and they always hope that there will be something at the end of the rainbow-the big smash hit. Two years ago I was very lucky and received three Oscar awards: two for the music for the motion picture, "The Way We Were." Naturally, after the song "The Way We Were" sold over $1 million of single records. I waited expectantly for the big check; I just knew that this was going to put me on easy street. I knew I was finally going to buy that wonderful Beverly Hills house. My parents were going to be proud and I was going to be fulfilled. When the "big" day came and the check arrived, it was for all of $5,000.

So my song actually sold over 1 million records and I received $5,000, based upon the mechanical rate as it is now computed. Of the

2-cent rate, the publisher gets one penny, I get one-half of the other penny because I only write the music, and the lyricist gets one-half

penny.

A couple of things that I heard today bothered me. For instance, this idea that "By the Time I Get to Phoenix" has been recorded 91 different times on what we call "cover records" and that therefore this is a spectacular and profitable event.

Let me explain why this is not representative of most songwriters' experiences. First of all, most records come out and are not recorded after that first record. What about all these songs that come out and are not smashes? Since Barbra Streisand is a very unique performer, "The Way We Were" gave me about 15 cover records, but nowhere near 91. It may be because the record people do not want to get into competition with Barbra Streisand; I do not blame them. But certainly, I do not want you to think that every time a record is released, even a small hit, it immediately proliferates into 91 other releases.

It bothers me and turns me off to the songwriting and record industries to know that the mechanical rate is so low. Also, I think that it is wrong to suggest that there should be no mechanical rate at allleaving the writers, publishers, and record companies free to negotiate for a price. Composers give birth to a little child called a song and it is very hard to go to the record people and say that this child is worth so much or that this song is more commercial, so that I should get more money. Composers are very creative, sensitive people; I do not want to go into an office and start negotiating for what I think my song is worth.

I think that the best thing to do would be to introduce a floor and ceiling for the mechanical rate so that a composer can get a reasonable rate. Then, we would not have to always "bargain down" to a lower rate as we often do now. I, as a successful writer, can tell you that many times I have not gotten the statutory rate; less successful writers may rarely get the full 2-cent rate.

In conclusion, let me just say that, Eubie Blake, from whom you will hear next, wrote a fantastic song years ago in 1921, called "I'm Just Wild About Harry." And the wonderful but sad thing that I told Eubie that we have in common is that he got paid exactly the same mechanical rate in 1921 as I got for "The Way We Were." Something is very wrong if album prices and record sales are going to continue to go up and the poor composer gets so little for his efforts.

"The Way We Were" sold over a million records and the "big" check was only $5,000. I think we have to do something about that because we are putting a lot of composers out of business. Thankfully Mr. Blake and I also happen to be able to perform. Otherwise we could not live.

Thank you.

Mr. DANIELSON. Thank you, Mr. Hamlisch.

And our concluding witness on this side of the debate is Mr. Eubie Blake of the American Guild of Authors and Composers and I am going to take the liberty of saying that for a man of 92 years you sure look good.

TESTIMONY OF EUBIE BLAKE, AMERICAN GUILD OF AUTHORS AND COMPOSERS

Mr. BLAKE. I just want to say this: I have been on the stage 76 years, because I started in 1899. But this is the first time I have ever had stage fright in my life.

Mr. DANIELSON. Let me ask you-after 76 years, you think you might make this your career?

Mr. BLAKE. My statement is that if I had to depend on just the royalties that I made from my music, I could not take care of my wife and family. So I agree with Mr. Hamlisch; I think that the mechanical rate should be raised. I am the worst businessman in the world. I do not know anything about business, I do not know anything about business, because all the businessman I know [gesturing]. And I do not want to get like that. So I think that the rate should be raised. Now, how far? I leave it to the economists to tell me how far it should be raised. I know it should be raised because I have been writing for years. But if I had to live off my royalties, my wife and I would be in the poor house tomorrow. Fortunately I can still perform to supplement by income. That is my statement and I am not going any further.

Thank you very much.

Mr. DANIELSON. Thank you, Mr. Blake. That is probably-I hate to say this Mr. Nathan and Mr. Gortikov-it is probably the most eloquent presentation today.

Mr. Drinan?

Mr. DRINAN. Thank you very much, Mr. Chairman, and thank you gentlemen.

I am sorry. I simply had to go to the markup of another bill during part of your presentation. I will ask Mr. Hamlisch first, even if the statutory maximum were increased from 2 cents to 4 cents, do I understand that you would still only get $10,000 instead of $5,000.

Mr. HAMLISCH. Correct.

Mr. DRINAN. So that you really would not be happy with what is being proposed?

Mr. HAMLISCH. No, I would be happy with that. I think that the 4 cents would be adequate-but, I would like to see Congress adopt a mechanical rate based upon a percentage of record sales-8 percent of sales. But, some people in the record industry do not seem to want to do that because it would be very hard to regulate. I think it would be adequate to adopt a ceiling of 4 cents.

Mr. DRINAN. Would you tell me more about your recommendation along with Mr. Blake, that the mechanical rate should be a mandatory 8 percent of the sales price of the phonograph records?

Mr. HAMLISCH. That is what most of the countries in Europe are getting now.

Mr. DRINAN. Would you tell us more about that?

Mr. HAMLISCH. The one thing about a percentage rate that I like is that it adjusts for the cost of living. If record prices go up, the composers will get more money based on percentages of prices.

I think the reason we are in a dilemma today is because in 1909, when a record sold at 35 cents, instead of making the rate a percentage

of the list price, Congress set a flat rate of 2 cents. As record prices went up, the rate stayed the same. Now composers, lyricists, and publishers together get the same 2 cents out of a record that sells for over a dollar.

Mr. DRINAN. Why do you not push for a percentage?

Mr. HAMLISCH. I do not think it is a question of that. I think it is a question of persuading the other side. I do not think that it has ever been an open question.

Mr. DRINAN. Try to persuade to Congress.

Mr. HAMLISCH. I am perfectly willing to do that. With your's and God's help, maybe we have a chance.

Mr. DRINAN. You will need more than God's help.

Mr. HAMLISCH. Unfortunately, I think you are right. I think we need more than God's help. I think what we really need is to make sure that everyone understands the situation, because I know that most people do not understand what composers do. Most people say to me, were you not in the movie, "The Way We Were"? And I say, no, I just wrote the music. And they get very depressed by that.

Second I think that if I received $10,000 based upon a 4-cent rate, I would be happy. I think that it would bring back some self-esteem to the composer. I think it is a rough life to live thinking that if you have a hit, a fantastic check will come in. When the check does come in, it is so small that they say, I cannot believe that this is it. I think that is our problem. Most people do not realize how low the rate really

is.

Mr. DRINAN. I take it, however, that you simply do not want the total deregulation of the industry?

Mr. HAMLISCH. No, because to be honest with you, composers are artists: we are not good businessmen. We are, I think, the easiest people to intimidate. I must give you an example.

If today, someone in the record industry said to me that I can have Frank Sinatra record a song of mine if, instead of 2 cents, I would take a half-a-cent. My pride would say, for Sinatra I will pay to have my song performed. I think what happens is that the writer gets coerced, because the marketplace is limited by certain companies and by certain singers. For example, as you realize, many singers record their own material.

I would love Elton John to record my songs but normally he records his own. I would love Stevie Wonder to record one of mine but normally he records his own. So the number of artists I have available to me is very small. Therefore, when one of the top artists wants to do a song of mine, it is very easy for the record company to bargain against me. The company says, if you want this artist to record your song, you are going to take less than 2 cents. If Congress sets a floor on the rate, I will not be put in that position again.

Mr. DRINAN. Going back to 1909-I am reading the law here-I find it anomalous how the Government interfered or intervened in the regulation, the very tight regulation, of this particular industry, and I am not entirely certain if the regulation is necessary, but appar ently there are no votes for deregulation on the other side of the controversy.

Mr. PATTISON. You missed it.