rather shocked me because it seemed so cheap. This is a cereal product. Today the price of wheat is about $2.50 a bushel. In 1934 it was 80 cents a bushel. We manufactured the product then. We had been paying, I think, about 90 cents an hour as a wage, not much, but that was the going wage then, and we guaranteed our people 40 hours' work a week. I was borrowing money then in Wall Street for 114 percent, commercial paper seven-eights. Today you know as well as I do that anybody, regardless of how good his credit is, is going to have to pay 4, 412, or 5 percent. Yet in 1934 this product never sold 5 packages for 39 cents. Maybe 2 for 17 cents or something in that area. I guess it is a terrible disservice to the American housewife that we sold our business so she is getting now 5 for 39, where in 1934 she paid a dime apiece for them. This is a terrible thing that I did, to sell out to this great, giant corporation. It is just too bad. But the American housewife is better off. The more restrictions we put on this great industry the more we are going to hurt the American housewife.

Mr. WILLIS. That is right.

Senator MORTON. The Chairman has said the "cents-off" becomes the current price. What a wonderful price to the American consumer. Some darn fool in the business is going to take 5 cents off and leave it there forever. If he wants to stay in business that way, okay. He is rendering a great service.

Mr. WILLIS. If there is any exception it is always in our favor? Senator MORTON. In the consumer's favor.

Mr. WILLIS. Yes.

Senator NEUBERGER. That is why I wondered about the product the Senator referred to. Was it 16 ounces or

Senator MORTON. It is exactly the same size today it was in 1934. Mr. WILLIS. Only better.

Senator MORTON. It isn't any better, because I used to make it. [Laughter.]

Senator NEUBERGER. I wonder why it is the cost-of-living index shows a continual spiral upward instead of downward, if we generalize from the

Senator MORTON. Because we have an awful lot of things other than grocery products. If you leave it to the grocery products the price-of-living index wouldn't go up.

Senator NEUBERGER. Like bread? A loaf of bread?

Senator MORTON. A loaf of bread has gone up.

Mr. WILLIS. Last year we had a campaign. Food was a bargain. The consumer pays only 19 cents. Ten years ago she paid 26 cents out of a dollar. We are now concerned that we are getting too little of the consumer's dollar. We would like to get it back up to 20.

Senator MORTON. Don't get into that, now. You are ahead. Stay there. [Laughter.]

Senator NEUBERGER. Senator Dominick?

Senator DOMINICK. Mr. Willis, you are pretty familiar I think with chainstore practices on shopping of other stores, are you not? Mr. WILLIS. No; my field is with the food manufacturer and I know the chainstore people. But I am not too familiar to be an

expert in how they operate with one another. I know they compete very hard with one another. That is why we have bargains.

Senator DOMINICK. I think I probably should say for the record that I did a lot of work on this when I was practicing law. The retail chainstores that I know of almost invariably shop their competitors' line every day. And at any time that they find that a product is under theirs, as far as price is concerned, they meet it almost immediately. Consequently you are bound to get prices about the same in the chainstores, and this is the point I would make.

Mr. WILLIS. That is a general practice in retailing. I didn't know what question you were leading up to. That is the general practice. Senator DOMINICK. That is all that I have. Thank you.

(The booklet referred to in Mr. Willis' statement follows:)

LABELS SERVE THE CONSUMER

The label on packaged products plays an important role in the consumer's freedom of choice. Food manufacturers have long believed in providing good descriptive labels which supply the important facts about the contents of their packages. Such labels are designed to help the homemaker make the wisest selection. Food manufacturers are constantly developing new and improved products and improving their labels.

No one can possibly have a greater stake in providing food that is safe, properly packaged for protection, honestly labeled, tasty, nutritious, and reasonably priced, than the manufacturer-the maker of the product. He must assume that responsibility because his very survival depends on satisfying the consumer with every purchase.

Today the American people consume a wider variety of better food than any other nation. They can choose from 8,000 items in the food stores, compared with about 1,500 items twenty years ago. They can buy their food requirements for only 19 cents of their income dollar, after taxes, compared with 22 cents a decade ago. This is the lowest percentage of any time in history and lower than anywhere else in the world.

A principal reason why our abundance of food is available to the American homemaker is because our form of government allows us to operate under the free enterprise system. This system provides a free market where manufacturers can apply their ingenuity, take risks, and compete freely for the consumer's food dollar. This is the direct opposite of the systems used in many countries, where industry is controlled by government and where the consumer has little or no freedom of choice.

We welcome your suggestions and inquiries concerning labeling, packaging, or anything else about foods.

Paul & Willia

President

Grocery Manufacturers of America, Inc.

6. Statement of ingredients in certain cases. (Many foods, for

example canned peas, mayonnaise, and macaroni, for which the government has set a "standard of identity," do not require a declaration of all ingredients.)

7. Statement and other information required by law must appear in the English language.

48-222 O-65-9