their economy. They are our friends. How are you going to cut your friends' throats and make them enjoy it? That is the problem I would like to have solved.

Mr. JONES. I think the most disturbing thing is a sudden change. If the price of butter was set that it was going to be reduced over a certain period, or at least the Government support, it would give the producers of butter a chance to adjust themselves to it.

The CHAIRMAN. That is exactly what Secretary Benson said. He told them at the Chicago meeting that he wah going to give the dairy men who supported the 90 cents of parity, one year to get their house in order, after that time a new program would be necessary.

I will go along with that. But take cattle, for instance, and now we are getting off to something else. When you have a 30 percent reduction in the price of cattle at the farmer's level, and no reduction in the price of beef at consumer's level, where you buy what you eat, then you are in difficulty.

Mr. JONES. Idon't think the Government can protect everybody.
The CHAIRMAN. That is what I wanted you to say.

Mr. JONES. Yesterday you said we are in effect in a revolution.
The CHAIRMAN. That is right; an economic revolution.

Mr. JONES. And we certainly cannot adjust from a war economy back to a peacetime economy without somebody getting hurt.

The CHAIRMAN. And right at the time we are in this economic revolution era, we are in a world revolution in regard to governments. While we are trying to save our economic skin, the revolutionary proposition may drown us in the destruction of our form of Government. We cannot support everybody. I don't even know if we can support fluorspar. I don't know. But we will sure give it a ride, if you boys will appear and give us the support you should. We will let the committee know what the situation is.

This was not any wartime action because it happened in 1952. Well, thank you very much, and we will help you in any way we can, as a small-business committee, to get your story over.

Well, we will proceed now. I thought we had just about finished, but they tell me there is some new information on lead and zinc that I did not hear.

Mr. Chase of Silverton is next.

STATEMENT OF CHARLES A. CHASE, EXECUTIVE VICE PRESIDENT, SHENANDOAH-DIVES MINING CO., SILVERTON, COLO.

The CHAIRMAN. Mr. Chase, will you proceed and tell us your story. Mr. CHASE. Thank you, sir.

I am Charles A. Chase. My official title is executive vice president of Shenandoah-Dives Mining Co. at Silverton. I function as general

manager.

I speak for Shenandoah-Dives Mining Co. of Silverton, San Juan County, Colo. I am 1 of 3 men who moved in 1925 toward the establishment of this enterprise. We began development in January, 1926, and have done since 18 miles of major mine passages and 4 miles of drill-hole exploration; we began to concentrate our ore into a marketable product July, 1928, up to now having processed more than 4 million tons of it, and bought 186,000 tons of ore from neighboring mines lacking facilities for the work.

The importance of the mine's business in San Juan County, and in Colorado, in the last 25 years shows strikingly in these statistics as to its own ore:

Money value is dollar value of concentrates as received at smelter, the statistics being furnished by United States Bureau of Mines. An item not in this tabulation is that 96 percent of all ore of the country milled in 1952 was concentrated at Shenandoah-Dives mill. San Juan County has a special fame in being the only county in the country without any acre assessed as agricultural land. Conditions being as I have presented them, you will see the shock that came to the local community on suspension of production by this company at midMarch after 6 months of heavy losses as lead and zinc prices fell abruptly.

The county's production, 1873 to 1952, inclusive, is as follows:

So, the people of the county have followed a tradition of the centuries in making a living by mining; and the tabulation presented in this paragraph shows it to be one of the richest counties in the State. The county in the past has survived periods of adversity in common with other areas. At this time, better developed and better equipped than before, it would steady itself with confidence to await the upturn. But now an unbelievable new factor enters: The Paley Commission, a small group appointed by the President, says that this country should forego largely production of lead and zinc, in favor of buying from abroad, the large idea being on its face to raise the living standard of so many foreign population, regardless of what may happen to communities such as ours scattered through vast areas of this country.

One may smile at this allegation of the foreign beneficiaries of this proposal in view of the presence in the foreground of important groups of our nationals as the prime beneficiaries, in control of the situations to be created. I go on now and divert a bit.

The Manhattan project was of such nature that the President might not submit it to the Congress.

Executive Order L-208, closing gold mines, not of this order, should have been debated in the Congress, and should have been denied use, it being the vicious thing it was.

The two orders seeming to have established precedent, the present action preparing the way toward ruin of so many mining communities in this country seems to move toward conclusion. That such proposal, seeming to bypass and affront the Congress, should be given attention as a serious matter is incredible to me. What has been considered our treasured protection by the Constitution seems to disappear in thin air. My point there is that this is something that needs the most widespread consideration, such consideration as the Congress can give, and it should not move from any small brilliant group without full congressional study.

The metal industries concerned offer a sane alternative in a slidingscale tax on imported metals. Its passage will give courage to stricken mines and their dependent populations.

That is all I have to say on that, Mr. Chairman.

The CHAIRMAN. I have one question I want to ask. Do you have a mill in Silverton, too?

Mr. CHASE. Yes.

The CHAIRMAN. Do you mill ore for small, independent miners?

Mr. CHASE. Yes. I mentioned that, that we have milled over 4 million tons of our own ore, 4,124,000 at the end of last year, and we have milled 186,000 tons of ore for neighbors.

The CHAIRMAN. Are you closing your mill now?

Mr. CHASE. Yes; we have to. The mill has a capacity of something over 700 tons a day. Unless we have our own mine to furnish the great part of that tonnage, we cannot operate.

The CHAIRMAN. How many small mines will be affected if you close the mill?

Mr. CHASE. I think perhaps up to 20 individual mines have produced there in recent years.

The CHAIRMAN. What has been your average employment in the mines, the number of men?

Mr. CHASE. In our 25 years, I should say it has been at or above 175. It is a little less than that now. It was less than that in these recent months.

The CHAIRMAN. On the wages of miners, you do not think cutting the wages is the answer to this problem?

Mr. CHASE. No, it is not an answer. The men are struggling like the rest of us to try to live. No, a wage cut would not be great enough to save the day.

The CHAIRMAN. Let me ask you another question. The increase of scientific, shall I say, or of the extrafine machinery that you have for working the mines and also your mills and smelters today makes the cutting of the wages of less value than it would have been some 25 or 30 years ago. In other words, you have cut down the number of men because of the development of the machinery?

Mr. CHASE. Yes.

The CHAIRMAN. That is true in all manufacturing industries? Mr. CHASE. Yes, It is the background everywhere.

The CHAIRMAN. And it is true in agriculture. The same mechanization for agriculture has changed the whole picture in labor for agriculture. I assume that it has in mining, too.

Mr. CHASE. That is true, certainly.

The CHAIRMAN. Then as far as you see it this morning, the only solution you offer to keep your mine open you mention in your last three lines.

Mr. CHASE. The thoughtful men who spent hours and days on that project are men to be honored for their thoughtful attention to the problem. They are on both sides of the fence. They were on the mining side in part, and some of them were on the selling side. That was their best judgment.

The CHAIRMAN. You have appeared before the committees in Congress, have you not?

Mr. CHASE. I have not, Mr. Hill. You see, we are relatively a small producer of lead and zinc-lead, zinc, and copper, so we have not been proper witnesses. The men whose very life it is are the witnesses. We are just caught in a jam. We need the revenues from all those five metals: gold, silver, lead, copper, and zinc. We get small revenues from each of those metals. So many of the people who have been talking to you and who appear before Congress are men who depend entirely on lead, or almost entirely on lead, or almost entirely on zinc. The CHAIRMAN. Those are all the questions I have. Thank you for a most excellent statement, Mr. Chase.

Mr. CHASE. You are more than welcome, and I thank the committee for hearing me. These things are hard to present.

The CHAIRMAN. If you have any suggestions for us, to give to this committee when they are considering this phase of their bill, we will be glad to see that they are given proper consideration.

Mr. CHASE. Thank you, Mr. Hill. I may be able to add something

more.

The CHAIRMAN. Thank you.

Now we will have Mr. Larson of Silverton to finish up Silverton.

STATEMENT OF C. LESLIE LARSON, VENTURE LEASING CO., SAN JUAN COUNTY, COLO.

Mr. LARSON. My name is Leslie Larson. I am a partner with William Gianetto and J. M. Cook, in the Venture Leasing Co., operating in San Juan County, Colo. We have a block lease in the Gold Price mine. We secured a loan from the RFC and the United States Smelting & Refining Co. to build a mill and to secure machinery for the underground operation. In order to receive these loans, it was necessary for us to supply a portion of the construction cost, for which we mortgaged our homes.

At the time the loans were made the prices of lead and zinc were 19.5 cents and 17.5 cents, respectively. We thought we would be conservative and use the 1945 to 1950 average price for a basis to calculate our ore reserves. That is 14 cents lead and 12 cents zinc.

We planned everything possible to cut our costs; we built our mill at the portal to cut out trucking. The mill was designed for minimum attendance. Our mine plans are to use the best equipment available for each job with consequent savings in labor. But, there is a point in cost that you cannot go below. Steel costs money even today and so does powder, machines, and so forth.

The wildly fluctuating prices have a detrimental effect on the mining industry. We spent a lot of time and money preparing a certain block

of ground for mining and facilities for milling the ore, then when production is about to start-we have no ore. Not because the metal has vanished, but because it has lost its value through price declines. When the price of lead fell from 16 cents to 12 cents and zinc from 15 cents to 11 cents, it reduced our ore reserve from 150,000 tons to 30,000 tons. If the price falls further, we will have only a few spots of high-grade ore to work on. The economics of this program would be questionable because of the small tonnages involved.

The costs of mining and milling of this ore have not declined with the return of our products, but actually they have risen. The cost of power went from an average of 1.7 cents per kilowatt to 2 cents per kilowatt and the cost of powder from $18 per hundredweight to $22 per hundredweight. Similarly, steel costs for both mill and mine. have gone up. Labor, our largest single cost, has risen slightly. The day of the automatic mining and milling operation is not yet here. We must use labor, and we must give him a wage equal to or better than that given in other occupations.

This next is in the form of a question, but it brings out the fact that we are in competition with foreign producers. How can our drillers. or mucking-machine men produce 12 to 15 times as much as a native of a foreign producer? Yet we are forced to pay 12 to 15 times the amount in wages. Our American miner is a good man, but he is not

a superman.

Thus, we are in a desperate circumstance; we cannot cut our costs. If we are to survive, we must be given a fair price for our lead and zinc products. The unfair advantage of our foreign competitors will surely drive us out of business unless something is done soon. Our repayments on loans are now coming due.

The dumping of foreign-produced lead and zinc must be stopped and to this end I can see no better plan than to adopt the sliding-scale import tax recommended by the lead, zinc industry committee. The CHAIRMAN. Thank you very much.

That is about the same type of testimony we had yesterday, if you listened to the testimony. We thank you very much. We will try and help you.

Mr. Cole had a word to say just for a second.

STATEMENT OF ENNIS COLE, MAYDAY MINING CO.,
SILVERTON, COLO.

The CHAIRMAN. Will you give the reporter your name and business? Mr. COLE. Ennis Cole, of Silverton. I have a little mine at Silverton, and I think these settlement sheets are self-explanatory. I was one of Mr. Chase's neighbors who was selling ore to his mill. After he went down, we went down.

The CHAIRMAN. Do you want to file that with the committee?

Mr. COLE. I want to file that with the committee.

The CHAIRMAN. That is the way you are paid on your ore?

Mr. COLE. That is right.

The CHAIRMAN. And you would not be paid at all when he closes down his mill?

Mr. COLE. He is closed down now.

The CHAIRMAN. And you have no other outlet?

Mr. COLE. No.