including witness fees and mileage for witnesses appearing in behalf of the Office before the Bituminous Coal Division and including witnesses before the Interstate Commerce Commission, personal services in the District of Columbia, traveling expenses, including not to exceed $2,500 for expenses of attendance at meetings at which matters of importance to the work of the Office are to be discussed, printing and binding, contract stenographic reporting services, and not to exceed $1,000 for newspapers, books, and periodicals, $172,530.

JUSTIFICATION OF ESTIMATE

Dr. HARR. The following justification is offered for the record: The Office of the Bituminous Coal Consumers' Counsel, an independent agency in the executive branch of the Federal Government, exists by the provisions of the Bituminous Coal Act of 1937, as amended April 11, 1941 (55 Stat. 134).

Under the provisions of the Bituminous Coal Act, as amended, it is the duty of the Bituminous Coal Consumers' Counsel to appear in the interests of the consuming public in any proceedings before the Bituminous Coal Division of the Department of the Interior (the agency which is charged with general administration of the Coal Act), and to conduct such independent investigations of matters relative to the coal industry and the administration of the act as he may deem necessary to enable him properly to represent the consuming public. In any such proceedings, the Bituminous Coal Consumers' Counsel has the right to offer relevant testimony and argument, oral or written, and to examine and crossexamine witnesses and parties to the proceeding, and has the right to have subpena or other process of the Bituminous Coal Division issue in his behalf. The Con sumers' Counsel is further authorized, if it appears to be in the interests of the consuming public, to require the Bituminous Coal Division to furnish any informa tion at its command or conduct any investigations as to any matter within its authority, and to place the results thereof at his disposal. In recognition of the effects of transportation costs upon coal prices to consumers, the Bituminous Coa Consumers' Counsel is given authority to make complaint to the Interstate Commerce Commission with respect to rates, charges, tariffs, and practices relating to the transportation of coal and to prosecute the same, and to have notice of and intervene in any such proceedings instituted by others.

For carrying out these functions, the Bituminous Coal Consumers' Counse is authorized to make such expenditures as may be necessary for the performance of the duties vested in him, and to appoint and fix the compensation and duties of necessary professional, clerical, and other assistance. With the exception of clerk to the Bituminous Coal Consumers' Counsel, the attorneys, and such special agents and experts as he may from time to time find necessary for the conduct of his work, all employees of the Bituminous Coal Consumers' Counse are appointed and their compensation fixed in accordance with the civil-servic laws and the Classification Act of 1923, as amended.

In view of the state of national emergency proclaimed by the President, thi agency has been cooperating with various agencies of the Office for Emergency Management in matters affecting bituminous coal consumers, and has devoted a considerable portion of its time and personnel to problems of coal and transporta tion of coal and their relationship to the needs and policies of national-defens agencies.

The Bituminous Coal Act of 1937, as amended, requires that the Bituminou Coal Consumers' Counsel make full report of the activities of his Office directly to the Congress.

The amount determined for inclusion in the Budget for 1943 by the Bureau o the Budget for the Office of the Bituminous Coal Consumers' Counsel is $172,530 This amount is for the period July 1, 1942, to April 26, 1943, the date of the expira tion of the Bituminous Coal Act of 1937, as amended. The recommendation her sought represents an annual increase of $2,036 or an increase of $1,696 over a perio of 10 months.

New responsibilities in the protection of the consumer are being placed upor this agency. This is due largely to the effects of the national-defense program on the demand for coal as well as on the facilities for the transportation of coal e. g., a proceeding instituted by this agency for the establishment of maximun prices is currently pending, and if, as expected, maximum prices are established this agency will be required to play an important part in investigating complaint

of violations, in participating in proceedings for revision of maximum prices, and otherwise in protecting the interests of consumers in the maintenance and enforcement of fair maximum prices.

It is not unlikely that the continued acceleration of business activity will so tax the Nation's transportation facilities that delivery of coal will not continue to be possible in the full volume which all consumers demand. If such proves to be the case, this agency should be prepared to study the transportation problems connected with the transportation of coal in order that the most efficient methods for its transportation can be devised. Another important step which will be essential is the education of consumers in the efficient utilization of coal. Consumers can be taught to satisfy their needs with less coal. The advice to be given consumers must be predicated upon careful technical research into burning methods and problems of efficient utilization of the types of equipment used in homes and in factories.

ECONOMICS AND STATISTICS DIVISION

The day-to-day business of the Office has involved the receipt of hundreds of inquiries and complaints from consumers, each requiring the assembling of prices, freight rates, or analytical data necessary to give the information requested or to determine whether the complaints have merit. In instances where the agency believes that a meritorious complaint has been made, factual material must be prepared for presentation of the case, testimony must be organized for hearings, charts and technical exhibits must be prepared for introduction in evidence, and experts must be assigned for attendance at hearings to sssist in the examination and cross-examination of witnesses. Transcripts of hearings and exhibits introduced by all parties must be analyzed to assist the Legal Division in preparing briefs and oral arguments.

In addition to this routine work, the Division must be equipped with an arsenal of background information which will be available for quick analysis of costs and realization figures released by the Bituminous Coal Division, so that the Consumers' Counsel will be prepared properly to defend and to promote the consumer interest in hearings which will be called on general revisions in price schedules.

At the time this justification is being prepared, two major proceedings are pending before the Bituminous Coal Division, one instituted by the Division itself for a general revision of minimum prices and one instituted by the Bituminous Coal Consumers' Counsel for the establishment of maximum prices. Both these major proceedings will be completed within the current fiscal year. However, the uncertainties of price and cost levels in an agency has been consulted frequently by the national-defense agencies for information concerning bituminous coal prices, supplies, and transportation, and must be prepared for continued cooperation with these agencies. Moreover, adequate protection of the consumer interest in these times frequently requires informal representations to agencies of the Government concerned with priorities, civilian supplies, transportation, and prices, where such factors may be of more vital immediate importance to consumers than matters formally before the Bituminous Coal Division or the Interstate Commerce Commission.

In addition to these immediate duties resting upon the Economics and Statistics Division, it has the responsibility for current analysis of statistical reports of the Bituminous Coal Division on prices, tonnage movements, distribution, cost of selling, and similar factors, and analogous reports of the Interstate Commerce Commission, which must be studied constantly with a view to swift action for revision in prices and regulations on the one hand, and coal freight rates on the other, when required for the protection of the consumer interest.

Beyond this, and of greater long-range importance, is the need for a careful and full analysis of the major results of, and problems involved in, the Coal Act. The House Ways and Means Committee has appointed a standing subcommittee to study such major problems with a view to proposing changes in the substantive provisions of the Coal Act at such time as they may appear necessary. It is of vital importance that the Consumers' Counsel be prepared to submit proposals for substantive changes which would better protect the consuming public, both from unduly high price levels and from discrimination. The agency must study and evaluate the effects of regulated prices on competitive relationships of coal and other fuels; trends toward increase in potential capacity (already in excess of any foreseeable demand) by the reopening of dormant mines and the opening

of the new mines; higher costs of selling (which have already become evident); the need, if any, for production control (which is being urged by some voices in the industry); the behavior of retail prices; the operation and effects of marketing agencies; shifts in the transportation pattern; shifts in tonnage among districts and marketing areas; discriminatory and unduly high coal freight rates; and the effect of local smoke-abatement regulation on consumers and the coal industry. The Congress will undoubtedly have before it for consideration during the fiscal year 1943 the question of a further extension of the Bituminous Coal Act. This agency must be prepared to present its recommendations on this subject to the appropriate congressional committees and to support its recommendations by a compilation of statistical and economic data which would require considerable work on the part of the Economics and Statistics Division.

As previously mentioned, this office already has instituted proceedings looking toward the establishment of maximum prices on bituminous coal. The hearing commenced on September 9, 1941. If, as a result of this hearing, the Director of the Bituminous Coal Division decides to establish maximum prices, such maxima must be thoroughly studied and analyzed by the Economics and Statistics Division, and their effect upon the consuming public must be appraised. An uneconomic pattern of maximum prices would work great harm to consumers of bituminous coal.

LEGAL DIVISION

The Legal Division's primary responsibility is to provide attorneys to represent the Bituminous Coal Consumers' Counsel at formal proceedings held before the Bituminous Coal Division and the Interstate Commerce Commission. The agency has instituted a number of proceedings on its own behalf and, in addition, must examine all petitions filed by others, to determine whether participation by the agency is required. The agency is represented only at those hearings which appear to be of importance to the consumer. Attorneys attending these hearings, which are held both in Washington and in the field, are required to exercise wide and independent judgment, and to make immediate important decisions during the progress of the hearings without opportunity of consultation with superiors. is, therefore, necessary that the Division be staffed with experienced attorneys who are capable of handling such independent work.

It

In addition to representation at hearings, which involves advance study and preparation, actual attendance at the hearing, presentation of witnesses, preparation of pleadings and briefs, and other legal work normally attendant upon administrative hearings, the Legal Division must handle other assignments incidental to the work of the office. Correspondence involving legal questions must be answered. Attorneys for bituminous-coal consumers must be received and advised. Legal research is necessary for the presentation of many of the cases initiated by the agency. Also within the sphere of the Legal Division fall questions requiring legal advice on administrative matters within the office, relating to personnel, budget, etc.

CONSUMER-RELATIONS DIVISION

This Division establishes and maintains contacts with consumers and consumers' organizations and supplies information to the public pertaining to the work of the agency. Letters are answered, publications are issued, and in other ways information is disseminated to consumers designed to help them with their bituminous-coal problems.

Mr. WOODRUM. The law extending this agency expires, as I understand, on April 26, 1943?

Dr. HARR. That is correct.

Mr. WOODRUM. And this estimate is based on the period beginning July 1, 1942, and extending to April 26, 1943, or approximately 10 months?

Dr. HARR. Yes, sir.

ACTIVITIES AND INVESTIGATIONS BY COAL CONSUMERS' OFFICE

Mr. WOODRUM. Will you tell us something about your activity, what you are doing and what you have done?

Dr. HARR. The Bituminous Coal Consumers' know, was made an independent agency this year.

Counsel, as you
Prior to that time

it had been operating under the Department of the Interior, acting very closely with the Coal Division of the Department of the Interior, so that we started out on a new basis when the office was made an independent agency, with three major new activities. First of all, we were promptly appointed a defense agency, because of the importance of bituminous coal to defense. Bituminous coal furnishes about 45 percent of the total energy used by the country, as contrasted to 30 percent generated by oil, 5 percent by anthracite, and so on. And so the first job was to try to get coal to the defense industries and allied industries moved at more than the normal rate during the summer, because we feared there might be a transportation shortage this fall. And we put on very intensive campaigns-using the press, radio, and motion pictures, and the O. P. M. assisted us in getting placards out and about 20,000,000 tons above normal were moved during the summer months.

The second new major activity was to protect consumers against runaway prices. The act gives us authority to protect the interests of the consumer so far as the prices of bituminous coal are concerned, and we instituted a proceeding before the Coal Division to seek the establishment of maximum prices for bituminous coal. That is not a set price, but a maximum ceiling price for bituminous coal. proceeding started the first week in September and is being continued now. It was adjourned until last week and is now again in the process of hearing, and we believe the Director of the Coal Division will set maximum prices or ceilings for bituminous coal.

That

The third thing we have started to do-I hate to use the word "research," because it is so much abused in some circles-but we are trying to study the best methods for the transportation of coal if a transportation emergency should arise. In the last war a good bit of the difficulty in regard to bituminous coal was due not to the lack of a supply of coal or inability of the mines to mine coal but to a tie-up of transportation; and we want to have a plan prepared in advance of any emergency so that the transportation of coal will not be interrupted as it was during the last war.

We also are setting up a program of getting the various State universities and colleges that have proper and adequate staffs to help us in a research into the uses of coal other than for fuel, with the thought that after the war emergency is over we ought to do everything possible to prevent a recurrence of what occurred after the last war, when the bottom dropped out of the bituminous-coal market and thousands and thousands of miners were without jobs and a good bit of the section of the country that depended upon the mining industry was even more depressed than the other parts of the country.

And we feel very strongly that the consumer deserves representation at Washington. The miner is well represented, because he has wellorganized unions, and the producer of coal is well represented through trade associations that are well financed, and he has good representation in Washington, and we feel the consumer, the fellow who pays the big price for bituminous coal, also must have his spokesman. There are 62,000,000 consumers, of bituminous coal in the United States, and we think that these consumers should be protected. We have our agents who investigate complaints of unfair practices in the bituminous-coal industry, and also what might be claimed to be unfair prices.

NUMBER OF PERSONNEL

Mr. WOODRUM. How many have you on your staff?

Dr. HARR. We have 57 on the staff.

Mr. WOODRUM. How many under civil service?

Miss BROOKER. Twenty-seven.

Dr. HARR. Of that 57, 9 are lawyers; they are not under civil service. This act was passed after the Ramspeck Act, which I believe accounts for that.

Mr. WOODRUM. Your agency is now an independent agency, in no way connected with the Bituminous Coal Division that has been placed in the Department of the Interior under the reorganization? Dr. HARR. That is correct.

Mr. WOODRUM. You are separate and distinct from them?
Dr. HARR. That is correct.

BACKGROUND OF DR. LUTHER HARR

Mr. WOODRUM. How long have you been with this Counsel?
Dr. HARR. Since July 1.

Mr. WOODRUM. Will you tell us something about your background? Dr. HARR. Prior to becoming Bituminous Coal Consumers' Counsel, I was professor of finance at the Wharton school of the University of Pennsylvania. I did not start as a professor; I started as an instructor in 1919, and later became professor of finance. I resigned from the University of Pennsylvania in 1939. I still have a lectureship, but it does not pay anything and is just an honorary title.

I was secretary of banking in the Commonwealth of Pennsylvania for 3 years, from 1935 through the end of 1937. I was then elected city treasurer of the city of Philadelphia, in 1937. For 2 years I was also chairman of the executive committee of the Association of State Bank Supervisors, which consists of all of the secretaries or commissioners of banking of all of the States.

Mr. WOODRUM. And what is your official title now?
Dr. HARR. Bituminous Coal Consumers' Counsel.

Mr. FITZPATRICK. How does that compare with the previous counsel?

Dr. HARR. Well, when it was with the Department of the Interior, as it was up until June of this year, they had an acting director who served as the counsel.

COOPERATION OF BITUMINOUS COAL COMMISSION

Mr. FITZPATRICK. What was the difference in the amount of money spent by the Bituminous Counsel?

Dr. HARR. No difference.

Mr. FITZPATRICK. Do you get any cooperation from the Bituminous Coal Division?

Dr. HARR. We have been getting very fine and splendid cooperation. Mr. FITZPATRICK. The others did not get cooperation.

Dr. HARR. I understand that.

Mr. FITZPATRICK. There was a lot of friction between the Bituminous Coal Counsel and the Coal Division itself.