The CHAIRMAN. Did that "public affairs fund" then include the entire fund of the association?

Mr. EMERY. Yes, sir; the entire fund under that head. The expenditures are all listed in here; the various amounts that are comprehended under the term "public affairs" are all set forth in Mr. Frawley's testimony. They have nothing whatever to do with matters political, most of them; they are expenditures in the so-called public activities of the association.

Mr. STAFFORD. How were you able to arrive at the amounts expended by Mr. Mulhall during the Cushing régime?

Mr. EMERY. That is where the discrepancy of $2,000 occurred. Mr. Frawley made one estimate and Mr. Bird made one.

Mr. STAFFORD. How are you able to arrive at any estimate during that period, when Mr. Mulhall testifies that expenditures were made by Cushing and there was no check on him as to the aniount?

Mr. EMERY. I am not familiar with the books, Mr. Stafford. I can only say that the testimony showed that the expenditures, instead of being differentiated in our other accounts, were lumped during the period of the Cushing accounts, and they derived their figures from the estimate made from the Cushing books.

Mr. STAFFORD. Do you know whether there are any accounts that show the amounts expended by Cushing during his activity with the N. A. M.?

Mr. EMERY. I do not know; I am not familiar with the books, Mr. Stafford, and the Senate record of Saturday, September 6, is given up to an analysis of accounts by Mr. Frawley?

Mr. STAFFORD. Who is this Frawley?

Mr. EMERY. He is the expert of the Senate investigating committee, to whom our books were turned over and by whom they were examined.

Mr. STAFFORD. And could Mr. Frawley testify as to whether the books showed the total expenditures made by Cushing?

Mr. EMERY. Yes, sir; he can give you all the information that he has given the Senate committee with reference to the books.

Mr. WILLIS. What are some of the items included in this public affairs expenditure? No doubt that will show in the printed record. Mr. EMERY. I could not testify as to that; I am not familiar with the books at all.

Shall I take the stand now, Mr. Chairman?

The CHAIRMAN. Yes; Mr. Emery.

FURTHER TESTIMONY OF MR. JAMES A. EMERY.

Mr. STAFFORD. This is in rebuttal, I assume, of the statement made by Mr. Mulhall in his narrative as published in the New York World of Sunday, June 29, 1913, as follows:

I believe that my accounts will show for the period I was employed by the organization that I, myself, handled close on to $200,000, and this money was strictly used in corrupting voters and in doing lobby work in Washington and in State capitals.

Mr. EMERY. Yes, sir.

Mr. WILLIS. You said something about a showing of $2,000,000. I think you read it from a newspaper clipping. What was that, Mr. Emery?

Mr. EMERY. That referred to the total income of the association during the 11 years covered by the examination of its books, from all sources.

Mr. WILLIS. That was not expended, you say, by Mr. Mulhall— this $2,000,000?

Mr. EMERY. Oh, no; the books showed that the income of the association during the 11 years ran from-I am just giving you average figures-I think, $180,000 to $225,000 gross. I am giving you a very rough estimate. The relation of Mr. Mulhall to those activities is shown by the fact that of a gross income of from $180,000 to $230,000 a year, Mr. Mulhall's salary and expenses were in the neighborhood of $5,000 or less.

Mr. WILLIS. Does this statement which is being incorporated into our records from the Senate hearings show how this $2,000,000 has been expended?

Mr. EMERY. Yes, sir. Well, the annual reports of the treasurers show that. There is an annual report of the treasurer published in the volume of the proceedings there which will give you a general idea, and then, of course, the detail is shown by the books of the association, which have been fully analyzed by the Senate committee.

Mr. STAFFORD. Is each member of the association furnished with a copy of the annual proceedings?

Mr. EMERY. Yes, sir; and I think it is quite widely distributed outside of that.

The CHAIRMAN. Mr. Emery, I will just ask you to proceed in your own way to make such statement as you desire, avoiding of course argument on the merits of the legislation in which these associations have been interested.

When did you become connected with the organization?

Mr. EMERY. With the National Council for Industrial Defense, I became formally connected on November 1, 1908. Prior to that time and from about January, 1908, while I was secretary of the Citizens Industrial Association of America, I had acted as counsel jointly for the Citizens Industrial Association of America and for the National Association of Manufacturers; that is, during the period between January, 1908, and November, 1908, at which time I resigned as secretary of the Citizens Industrial Association of America and became counsel for the National Council for Industrial Defense. If you will permit me, Mr. Chairman, I should like to give the committee, if I can, an idea of the movement out of which these associations have grown, since they did not spring full grown, like Minerva from the brain of Jove, but were rather the outgrowth of a continuous movement having its origin in the perceived necessity of cooperation among business men throughout the United States and particularly the employers who were interested in the principles of the open shop.

I presume that the committee will take judicial notice of the fact that there has been in this country for the past 25 years, growing each year in numbers, in power, in influence, and in perfection of organization, a very powerful combination of workingmen, known as the American Federation of Labor, embracing within its membership some 28,000 local unions. 115 international unions, about 680 city

federations, or city labor councils, and substantially about 640 federal unions which are organizations formed directly from the headquarters of the American Federation of Labor and drawing their charters therefrom. This great body is committed to the principle of what we term the closed shop; that is, it undertakes to say that none but its members shall be employed in the shops of those with whom it makes collective contracts for the sale of labor. And it endeavors by every power at its command to cause the making of such contracts in large numbers.

66

Those employers of labor who do not agree to the acceptance of such conditions and desire to maintain what are termed open shops,' in which no discrimination of employment is made between men on account of membership or nonmembership in a labor organization, if they reject the terms of the federation, find themselves at a decided disadvantage in a contest which may grow out of such declination. As a result of such contests the country has become familiar with what we term labor disputes and labor controversies. The right of an individual to operate his business under the conditions that please him best, provided it is a lawful business and operated in a lawful way, is, of course, one of the most fundamental rights of a citizen in this country. And I assume the committee will take notice of the fact that the principles which may be said substantially to underlie controversies of this kind are very fully set forth in a very famous document which I should like to call to the attention of the committee, known as the Report of the Anthracite Coal Strike Commission of 1902, which may be said to be the bible of industrial principle in this country.

That, you will recall, was a commission appointed by President Roosevelt in 1902, at the time of the great anthracite coal strike which paralyzed the coal regions of Pennsylvania, and as an indirect result because of the inability to secure coal had caused the shutting down of a vast number of factories and had been accompanied not only by great distress and inconvenience and loss, but by a very considerable amount of violence, the outgrowth of the bitter feeling engendered by it. The President appointed a commission to inquire into the causes of the anthracite coal strike, the claims of the participants thereto, and to this body was submitted a vast amount of testimony, and out of it grew the findings of this commission.

The commission itself was a very notable body, including representatives of both employers and laborers, and a very distinguished churchman, its chairman being the former Senator from Delaware, Mr. George Gray, now a United States judge of distinguished reputation. They not only undertook to settle the particular controversy that was before them at that time, but they undertook to formulate certain definite principles, and these principles were indorsed by all parties to the agreement, including the representatives of organized labor on that commission, who was the present Interstate Commerce Commissioner. Mr. Clark, then grand chief of the Order of Railway Conductors, I believe.

Those principles were very succinctly set forth, were indorsed by Mr. Roosevelt, and apparently acquiesced in by all the parties to the

controversy. They are substantially set forth in the conclusion arrived at in its award:

That no person shall be refused employment, or in any way discriminated against, on account of membership or nonmembership in any labor organization; and that there shall be no discrimination against, or interference with. any employee who is not a member of any labor organization by members of such organization. (P. 79, Report Anthracite Coal Strike Commission.)

And you will recollect that the black list, the boycott, and the sympathetic strike, and the principles therein exhibited, were very sharply condemned.

I refer to that because the principles that were vindicated in that finding and acquiesced in by the parties to it have frequently been appealed to in great industrial controversies in this country from that time to this. And while it is true that there is nothing more serious to a nation or State than controversies between employer and employee, it is, I think, equally true that no man can be compelled to surrender a principle of private or public conduct that can

not

Mr. CLINE. And it does not make any difference from which side

it comes.

Mr. EMERY. No. sir; none whatever. These are principles that are not subject to the whims or caprices of either employer or employee, and every one, standing upon his rights, is entitled, as I understand it, to the protection of his individual rights and property and property rights when they are threatened in such a dispute. As the result of such feeling there have grown up the organizations I have referred to of employees, and no man questions the right of such organizations to exist or to pursue their purposes provided they are lawful and are accomplished by means lawful in themselves.

The same is equally true of organizations of employers, and as a result of this controversy waged in industrial fields there has come also a great legislative controversy, in which, following the decisions of the courts of the United States and of the various States-in which the principles I have alluded to in the anthracite coal strike findings have been fully vindicated; in which the boycott and the sympathetic strike have been condemned, and in which violence has been set down-there has followed what the associations I represent conceive to be a very powerful and systematic effort to secure the repeal of these decisions of State and Federal courts by legislation, the purpose and effect of which would be to deprive employer and employee of the equal protection of the law by giving to combinations of labor engaged in labor disputes a new rule and principle of law to be applied to them which would not be applied either to them or to any other except when they were engaged in labor disputes.

Secondly, there is a very deliberate and systematic effort, as we see it, to weaken the power of the equity courts of the United States and withdraw from rights of property and of person the protection which they enjoy in a labor dispute as they do in any other dispute, and this is sought to be accomplished chiefly by defining away those rights of property which by the common consent of English-speaking people have been recognized as such since time immemorial.

Mr. CLINE. Won't you digress there enough to say what those rights are they are trying to define away?

Mr. EMERY. Those rights are chiefly expressed in the so-called Pearre bill; they were expressed at a later date in the so-called Wilson bill; and they are expressed to-day in the Bacon-Bartlett bill now pending before the House and Senate. The chief purpose of that is to provide, first, that the right to do business or to employ or be employed or the good will of a business, shall be a property right and protected as such; secondly, that no act of two or more persons, done in furtherance of a trade dispute, shall be unlawful unless the act, if done by one person, shall be unlawful-thereby repealing, as we understand it, the principle of conspiracy itself.

The effort of the American Federation of Labor to secure the recognition of these principles in law, and to secure, if not a validation, at least a withdrawal of the judicial condemnation of the boycott, has been exhibited in the variety of bills introduced during the last 15 or 18 years, and the activity of the federation with respect to them. That excited an activity on the part of employers in defense of what they conceive to be their rights and the rights of their employees, as exhibited in the history of the Federation of Labor from year to year.

The committee will understand that I call this to your attention merely for the purpose of supplying a background from which you will be able to measure the origin, purpose, and method of operation of associations of employers, which I have represented, in counteraction to the efforts of the American Federation of Labor, to obtain these certain principles in legislation.

Mr. CLINE. I want to be sure I am right on one proposition. My understanding is that the most strenuous fight has been waged against the proposed limitation of the equity powers of a court with reference to issuing injunctions and restraining orders.

right?

Mr. EMERY. Yes, sir; a very strenuous fight in that respect.

Is that

Mr. CLINE. Now, Mr. Emery, you do not contend, do you, that that limitation is for the sole benefit of a member of the American Federation of Labor? In other words, that limitation, if it is effective, must extend to all persons irrespective of whether they belong to organized labor or not?

Mr. EMERY. Well, what I do contend, Judge Cline, is that the purpose of the limitation is to apply a new rule of law and to limit the protection which can be given in labor disputes, since it is to labor disputes only that it is sought to apply this rule of law.

Mr. CLINE. But you do not answer my question. I want to know of you whether, in your opinion, that was for the exclusive benefit, practically applied, of the labor organizations of the country?

Mr. EMERY. The effect of that would have been most beneficial to them when engaged in a labor dispute, because the repeal of the remedy would, of course, permit an organization-and an organized effort is, of course, far more effective than individual effort; it would apply not only to the American Federation of Labor but to any organized effort. And, as Justice Brewer said in one of his opinions, the moment the door was opened to the deluded unionist the anarchist would be the first man to enjoy the entrance.

Mr. CLINE. It is applicable to the individual member, irrespective of his labor affiliations?