out the publishing field. The biggest magazines and newspapers are obviously best able to get out of the mails if postal rates become too costly. They would not only be able to survive but would be able to buy out their less well-heeled competitors, thus moving closer to monopoly in dissemination of the printed word. The paper makers are so sold on democracy and the importance of a free interchange of a great variety of ideas and viewpoints that we believe that there should be more publications and more publishers. We are convinced that passage of this bill would mean fewer publications, and the dissemination of fewer ideas and viewpoints.

An abundant supply of printed material at a price within the reach of all the people, resulting in a fully informed citizenry, is a prerequisite to the prevention of tyranny. An easy, inexpensive axchange of ideas, opinions, and information, available to all the people, is our best insurance against dictatorship. This basic concept has always been a cornerstone of the thinking of the paper makers. We are proud that labor and management in this industry have maintained this policy of abundance with a great degree of success, notwithstanding the enormous demands placed upon us by two world wars. This bill, H. R. 2945, threatens to destroy at the distribution end the wide dissemination we have worked for at the production end. It threatens to wipe out many publications which exist now only because Congress has felt they serve a socially usefu purpose and should be aided by low mail rates.

We believe that you should know that this bill has already affected labor relations in the paper industry. Negotiations for new contracts with paper manufacturers in both Canada and the United States are going on at this hou and H. R. 2945 is playing a prominent role in the discussions. I have just com from lengthy conferences with Canadian newsprint producers. The paper makers have had union-shop agreements with some of those companies for 35 or morë years, with no lost time as a result of strikes or lock-outs.

Labor and management in our industry have always been able to settle their differences around the bargaining table until this year. The conferences have now been recessed for 3 months, and one important reason for the collapse of negotiations was the threat to production embodied in the bill we are discussing today.

Under these circumstances, you can understand why our 60,000 skilled crafts men of the paper industry are vitally interested in your action on this bill. We believe that a drastic increase in postal rates means reduced consumption of paper. The effect that would have on our organization is obvious. It is ou policy to do everything possible to maintain full employment and maxim production in the paper industry. We believe this is the policy of Congress, and therefore we believe this bill should be rejected.

But we have even a deeper interest than the welfare of our industry and our members. We believe that basic issues of fundamental public policy are involved. The basic question before you is not simply whether postal rates shall be raised in hopes of reducing the bookkeeping deficit reported by the Post Office. The real issue is whether the Post Office shall be a mercenary business organization, coldbloodedly eliminating personnel, offices and services which do not pay their way despite their value to the public, or whether the Post Office should continue to be essentially a service institution operated for the benefit of all 150.000.00 Americans. The paper makers strongly endorse the latter course. We submit that the Post Office was established as a service to the public and should continue to be operated as a service.

Our union has officially gone on record as strongly opposed to this bill. Resulytions on this subject adopted by our executive board were unanimously endorsed at our convention last March. As president of the organization, I was directed to take the following positive steps in opposition to the threat to our liveliho embodied in this bill. My instructions were:

1. To request permission to present our views to the Congress.

2. To inform the press of our opposition.

3. To notify officers and members of our 300 locals in the United States of the action by the executive board and the convention.

4. To utilize our two publications, one a newspaper and the other a magazine. to keep our entire membership fully informed of developments as they occur. This statement has stressed the role the publishing industry plays in the promotion of our democratic way of life. There is good reason for this emphasis. The paper makers are extremely proud that theirs is a truly democratic union. It is only natural that we should oppose any scheme which would have the effect of weakening the democratic system on the national level.

We are aware of the money being spent through mail contracts to subsidize the railroads, air lines, and shipping. We do not quarrel with this means of building and maintaining military strength to protect and promote peace. We are aware also of the billions we are pouring into foreign countries to promote and protect the democracy of other peoples. Nor do we quarrel with that policy. But we believe that whatever it costs to maintain a post office on a public service basis is money well spent in strengthening our own democratic way of life at home. The cherished institution of democracy is dependent upon inexpensive circulation of free ideas, opinions and information. It is so fundamentally a part of our American system we are confident all citizens are willing to contribute to its preservation. If foreign peoples had such a relatively inexpensive system of mass communications, we would have no need for the Voice of America and other costly services we now give to the world.

In conclusion, the paper makers believe that the Post Office Department is now rendering an invaluable service to the cause of American democracy. We feel that postal officials should be congratulated for the service they are now performing in carrying out a wise congressional policy, and that Congress should restate and reinforce its historic policy of low mail rates for the dissemination of information. There never was a time when it was more important that the American public be fully informed. As taxpayers, we are perfectly willing to bear our share of the cost, whatever it may be, to subsidize the promotion of democracy on the home front.

Thank you for the privilege of presenting our views.

STATEMENT OF M. PONZIO, PRESIDENT, AND J. LYLE KALLENBACH, SECRETARY, OF PAPER MILL WORKERS' UNION, NIAGARA, WIS.

Mr. Chairman and members of the committee, we, as president and secretary of the Paper Mill Workers' Union of Niagara, Wis. (independent), are writing on behalf of the union, which represents all of the hourly paid workers (except one small unit) employed in the Niagara mill of the Kimberly-Clark Corp. located at Niagara, Wis. Our membership is in excess of 700 people.

This week our union and another union representing the hourly paid employees at the Kimberly, Wis., mill of Kimberly-Clark Corp. have been in bargaining sessions with the corporation's representatives. During our session with Mr. Cola G. Parker, president of the corporation, attended our meeting and informed us of the fact that your committee is considering a bill pursuant to which, if passed, postal rates affecting second-, third-, and fourth-class mail will be substantially increased. He also told us of the substance of his presentation to your committee on behalf of the paper industry as to its position and its interest in this subject, and more particularly the situation of those mills manufacturing book paper which is used primarily for the publication of magazines, advertising booklets, and catalogs, which are handled through the mails either as second-, third-, or fourth-class matter.

Among other things Mr. Parker told us that he had been asked about the position of hourly paid workers and of their unions on this question. That is very much to the point, because this week's bargaining session related in part to the working out of work schedules resulting from reduced production and reduced running time in both of these mills. Thus, you will know that we are vitally concerned about any Government action which might further reduce the demand for the types of paper that are manufactured in our Niagara mill.

Of course, we do not know first-hand the effect of increased postal rates on the actual use of paper by magazines and advertisers. However, they have told you their story and we know, because of our already shortened running schedules, that the demand for this kind of paper has dropped materially. We are deeply concerned that the Government not take action which might further curtail the use of the products which we produce, and particularly at this time. The Niagara mill of the Kimberly-Clark Corp. is the only industrial enterprise in our village. Its total population is completely dependent on the adequate running of that mill. Practically every pound of paper which the members of this union produce at that mill moves to customers who use it in publications and in other forms which, when sent through the mails, travel either second, third, or fourth class. We urge that you and your committee give very serious consideration to the effect on the publication and advertising, mailorder, and similar businesses, and the consequent effect on communities such

as ours before you recommend any new rate structure that would mean a reversal of the long-time policy of Congress with respect to second-, third-, and fourth-class rates.

The CHAIRMAN. The hearings will be adjourned until 10 o'clock Friday morning.

(Whereupon, at 11: 55 a. m., the committee was recessed, to reconvene at 10 a. m. Friday, May 20, 1949.)

READJUSTMENT OF POSTAL RATES

FRIDAY, MAY 20, 1949

HOUSE OF REPRESENTATIVES,

COMMITTEE ON POST OFFICE AND CIVIL SERVICE,

Washington, D. C.

The committee met at 10 a. m., pursuant to recess, in room 214 of the House Office Building, Hon. Tom Murray (chairman) presiding. The CHAIRMAN. The committee will come to order.

We will resume hearings on H. R. 2945. Our hearings and all witnesses with the exception of Members of Congress who desire to appear before the committee on the pending legislation and the Postmaster General who will appear in rebuttal, have been concluded. We have denied the request of some who at the last moment asked to appear before, the committee. We told them that they had not made their application in time and since the hearings had been quite protracted and drawn out, we just could not hear any more witnesses.

However, Mrs. May O. Vander Pyl, president of the Advertising Letter Service of Detroit, Mich., came in the first of this week and insisted that she be given a few minutes since she had come all the way from Detroit. In view of that fact, I thought that the committee would make one exception to the rule and would hear Mrs. May O. Vander Pyl for a few minutes.

Mrs. Vander Pyl, you may proceed with your statement.

STATEMENT OF MRS. MAY O. VANDER PYL, PRESIDENT OF ADVERTISING LETTER SERVICE, DETROIT, MICH.

Mrs. VANDER PYL. Mr. Chairman, Mrs. St. George, gentlemen of the committee, thank you for the special privilege you have granted to me for a brief statement. I appreciate the courtesy.

I am Mrs. May O. Vander Pyl, president and owner of a business in Detroit, Mich., known as Advertising Letter Service.

On your desks is a complete file of the supplements to my remarks. Permit me to call your attention to the picture of a house in the upper right-hand corner of the top page of the manuscript before you. It is my house. my business office, and, I hope, the home of the business of my son and at least one of my grandchildren. It has taken me 25 years to build my house. It is the house that third-class mail built. I am speaking, today, by instruction, for Michigan producers of direct-mail advertising and for their opinions largely as small-business people, as to the effect of proposed increases in postage rates on the class of mail used for business-building-third class. I am frankly speaking also for my house, the one that third-class mail built; I still owe money on it; I will owe more under this bill.

It has been my privilege to be identified with several previous hearings on postal rates over the years. Those years, beginning with my Washington days, when as a young woman I was a teacher here, have seen a number of changes in the post-office laws and regulations that now are the Federal rules of my business and my livelihood. My recollection is that most of those changes were opposed by somebody or other who, right or wrong, felt that his or her interest would be hurt. I observe, as I look back, that most of the time those fears were jus tified, and the rest of the time they were not. Only the history of the ups-and-downs of the national economy can explain it. In any case. the individual must adapt himself or herself, or fail. I can adapt myself, but I am thinking of so many who can only fail, especially young newcomers, perhaps GI's from the Second World War, no matter how broad the shoulders, how stout the heart, there is a limit to the load one can carry.

All I am qualified to tell you is what I have learned the rough way on the stony road of competitive advertising by direct mail, the road of the small-business man and woman.

Direct mail as a factor in advertising is astonishingly new for so major a medium. In fact, my own career so closely parallels the "career" of direct mail, permit me to describe it. I started in one tiny room with one business machine, a typewriter, not new, paid for on installments. Frankly I was not at all different from hundreds of others on farms, in small towns, in cities, for that was what directmail advertising amounted to, 25 years ago. Compared to several giants of today who started from such humble beginnings. I am stili smallfry, but, I have my dream-house and I like it; it's the house that third-class mail built.

I recognized that direct mail was primarily the sales medium for the small-business man and woman. I gambled my typewriter and my future on that belief. That basic principle is just as true today as it was a quarter of a century ago. My average order, today, is ap proximately 1,000 pieces of third-class mail. My customers are all kinds of interesting people, alley garages up to swank 500-car automobile dealers, grocery stores in my neighborhood up to national chains, neighborhood specialty shops where I watch the nylon sales, up to the J. L. Hudson Co. of Detroit, one of the world's most famous department stores.

People in the direct-mail business handle small orders. Their existence depends on their knowledge of the postal service, how that service helps to build business, and how to build volume for both. I think there is a dangerous misunderstanding about how the mails are used to carry advertising matter, and why they are so employed.

I venture that at least 90 percent of the advertising matter carried at third class in the mails represents the effort and carries with it the prayers of the mailer in some small business, some man or woman, to bring back business, to make a living, to succeed in the American way of competitive enterprise, and be secure in the reward of enterprise. Permit me to point out the difference between direct mail advertising and mail-order selling; it is important.

In nail-order selling, merchandise is offered from a catalog or a medium of similar type. The people who buy mail-order merchandise do so either because they believe they get better value or, in many cases, because the merchandise is not available to them otherwise. In