Senator MORSE. My answer, Senator Wiley, is that I think that for the next few years no legislation on this subject which refers to the question of ownership should be passed. I think the Government should work out with the communication companies cooperative arrangements on contract with them to the extent that they want to participate in helping develop the program. But I just hold to the point of view that the public interest will be better protected if the Government continues to really be in complete charge of the program until we know more about it. Senator WILEY. I realize that is your position. See if I can just get you to budge a little bit on the proposition that in this country-this country was not built up simply-we divided power in the executive, legislative, and judicial, and we recognized that power in one man's hands became corrupt and corrupted others. We saw through the years in the church, in kingdoms, and so forth, that where absolute power existed, it created not constructive things, but destructive things. And so what we are trying to do here—and I am sure the people on the other committee are just as sincere workers as we are here-we are trying to find a way and a method that will bring about the result as expeditiously as possible. That is why I felt that perhaps you might see a little, give a little bit, in the line of controls. Senator MORSE. I have a suggestion. Senator WILEY. Not an inch? Senator MORSE. I have a suggestion: That we set up a Government corporation for 10, 15, 20 years, to administer this program with the authority to work out contractual relationships with monopolies to develop the program. That is much to be preferred, in my judgment, to either the Kerr bill or the administration bill. Set up a Government corporation. Put it in charge of the program, but not give to the monopolies the policymaking determination. That is where I leave the administration on this bill. I think it is so important that in the public interest, with this vast area so underdeveloped, that, to use an analogy, we do not even have many trails through the jungles of space yet. And we have got to wait, in my judgment, until we know what all of these implications are. I would rather make that proposal. I understand-I did not hear the testimony-that Mr. McGhee is reported to have testified before the Kerr committee that it would make things easier for the State Department if the Government owned the system, and I assume if he said that, that he was thinking about this broader subject matter that I raised in my testimony; namely, the whole international relations problem that may confront us in the next few years in regard to space. I am greatly disturbed about those problems. I just do not think we have the slightest idea yet what complications we are going to get into with our friends and our foes internationally in regard to space. Therefore, I think the Government ought to keep itself in a position of control through a Government corporation setup that can cooperate with your private entrepreneurs, until we know more about it. Senator MORSE. They got a lot of subsidy, too, just as the railroads did. Senator WILEY. Supposing that the bill-and it will be undoubtedly compromised supposing that the bill, when it comes out, will have something like this in it: Fifty percent of the stock to the so-called utilities that we have been talking about, 50 percent will go to the citizens, and I think 10 percent of that 50 would be so that foreigners could buy it. Then there is a limitation—I am not saying this is the final provision-but there is a limitation that no corporation that would be of the so-called utilities can own over 20 percent of the stock. In order to bring into the picture what we have had in these other instances, should there be a provision that the Government would own some of the stock? Senator MORSE. I would have them own it all. Senator WILEY. I realize that, but you know we do have strong minds, you on one side and a few folks on the other side, and, generally, legislation is a compromise. Senator MORSE. Sometimes it is not passed at all. Senator WILEY. Yes, I realize that when you get some folks that like to filibuster, like a certain Wayne Morse, you can block it. But now let us be a little bit practical. If we have to do something expeditiously, and we have strong people who believe in the free enterprise system, and we have strong people like you who believe that government ought to furnish all the money and do all the job, do you think there is an opportunity there for some kind of a compromise? Senator MORSE. Of course, that is not the alternative, may I say most respectfully. I am not proposing that the Government provide all the jobs. I have already testified that I think a lot of contract arrangements can be let by the Government with your communication companies. I am simply saying that the Government for the next few years at least, until we know about the developments in space, has got to remain in complete control, and that the relationships between the Government and the company is going to have to be on a contract basis and not on an ownership basis. Senator WILEY. Now, we have the question of control. We were talking about money. Now we are going to talk about the question of control, because the suggested compromise would have in it six of the directors elected by the big boys, six by the small boys, and the Government would elect, I think it is, three. So you have 15 directors. The question of control is involved there very clearly. I was wondering what you would think of something of that kind. Senator MORSE. I would oppose it. Senator WILEY. What? Senator MORSE. I would oppose it. Senator WILEY. You would oppose it. In other words, you do not see any opportunity for these divergent minds and you know how divergent they are trying to get somewhere? Senator MORSE. My answer, Senator Wiley, is that I think that for the next few years no legislation on this subject which refers to the question of ownership should be passed. I think the Government should work out with the communication companies cooperative arrangements on contract with them to the extent that they want to participate in helping develop the program. But I just hold to the point of view that the public interest will be better protected if the Government continues to really be in complete charge of the program until we know more about it. Senator WILEY. I realize that is your position. See if I can just get you to budge a little bit on the proposition that in this country-this country was not built up simply-we divided power in the executive, legislative, and judicial, and we recognized that power in one man's hands became corrupt and corrupted others. We saw through the years in the church, in kingdoms, and so forth, that where absolute power existed, it created not constructive things, but destructive things. And so what we are trying to do here—and I am sure the people on the other committee are just as sincere workers as we are here—we are trying to find a way and a method that will bring about the result as expeditiously as possible. That is why I felt that perhaps you might see a little, give a little bit, in the line of controls. Senator MORSE. I have a suggestion Senator WILEY. Not an inch? Senator MORSE. I have a suggestion: That we set up a Government corporation for 10, 15, 20 years, to administer this program with the authority to work out contractual relationships with monopolies to develop the program. That is much to be preferred, in my judgment, to either the Kerr bill or the administration bill. Set up a Government corporation. Put it in charge of the program, but not give to the monopolies the policymaking determination. That is where I leave the administration on this bill. I think it is so important that in the public interest, with this vast area so underdeveloped, that, to use an analogy, we do not even have many trails through the jungles of space yet. And we have got to wait, in my judgment, until we know what all of these implications are. I would rather make that proposal. I understand-I did not hear the testimony-that Mr. McGhee is reported to have testified before the Kerr committee that it would make things easier for the State Department if the Government owned the system, and I assume if he said that, that he was thinking about this broader subject matter that I raised in my testimony; namely, the whole international relations problem that may confront us in the next few years in regard to space. I am greatly disturbed about those problems. I just do not think we have the slightest idea yet what complications We are going to get into with our friends and our foes internationally in regard to space. Therefore, I think the Government ought to keep itself in a position of control through a Government corporation setup that can cooperate with your private entrepreneurs, until we know more about it. I suppose that what I have said can be pretty well summarized in this capsule phrase: This is not the time for this kind of legislation. Senator WILEY. I want to thank you, Senator. I feel that you always make a contribution to people's thinking. You challenge them to try to find answers, and I suppose that is the main purpose of a Senator, any way, unless it is to confuse. Senator MORSE. I want to thank you for your unfailing courtesy. (At this point, Senator Wiley left the hearing room.) Senator KEFAUVER. Senator Morse, you referred to the fact that Mr. McGhee had made a statement. He said that it would make it easier if Government, for the time being, at least, owned the space communications satellite. His testimony in that regard is page 312 of volume 2 of the hearings of February 28, 1962. I will read a very brief quote: I might respond to one of your earlier questions. You might say that it would be better to approach this matter entirely from the standpoint of a Government corporation. This would simplify it. We very much seek to avoid this for the reason we believe this is an area which should have been well served by private enterprise and which should continue to be. I ask permission to put in the rest of it. Senator MORSE. But he made perfectly clear that he supported the administration bill. Senator KEFAUVER. He said it would be easier. Senator MORSE. He made his observation in regard to the ease of administration. Senator KEFAUVER. Senator Morse, there are many other questions that we would like to go into with you. We perhaps can at a later time. We have Mr. Farley from the State Department, whom we wanted to hear this morning, and I want to invite you, sir, to come and sit with the committee. We are glad to have all Senators do this, and I want to issue a special invitation to you to stay now, if you can, to sit with us and join in questioning Mr. Farley, because he is going to talk particularly about international law. If you can stay with us, we will be glad to have you do so. Senator MORSE. My inability to stay will be my loss, Mr. Chairman, but at 12 o'clock I have to be in the office of the Secretary of Agriculture with a group of Oregon lumbermen who seem to think that maybe there could be some improvement in regard to our lumber policies, and, therefore, if you will excuse me, I will be on my way to my next seminar. Senator KEFAUVER. Thank you very much for your appearance here today, Wayne. Mr. Farley, suppose you come around now. Mr. Claxton, a very fine, old friend of mine from Tennessee, is with Do you want to come around? you. Mr. Philip J. Farley has a very distinguished education-B.A., M.A., and Ph. D. from the University of California at Berkeley, Calif. From September 1960 to the present, he has been Special Assistant to the Secretary of State for Atomic Energy and Outer Space. Your more detailed biography, which is of interest, will be printed at this place in the record, Mr. Farley. (The biography referred to follows:) PHILIP J. FARLEY From September 1960 to present-Special Assistant to Secretary of State for Atomic Energy and Outer Space. From October 1957 to September 1960-Special Assistant to the Secretary of State for Disarmament and Atomic Energy. Principal staff officer for backstopping disarmament and nuclear test negotiations, development of disarmament policy, interagency coordination. Coordinated outer space matters in Department of State after establishment of NASA. July 1954 to October 1957-Deputy Special Assistant to the Secretary for Atomic Energy. 1952 to July 1954-Chief, Policy Analysis Staff, Office of the General Manager, Atomic Energy Commission. 1947 to 1952-Recording Secretary and Assistant Secretary, Atomic Energy Commission. 1946 to 1947-Intelligence Analyst, Air Force Intelligence. 1944 to 1946-U.S. Strategic Bombing Survey. 1943 to 1944-U.S. Army Air Force. 1941 to 1943-Instructor, Corpus Christi Junior College, Corpus Christi, Tex. 1935 to 1941-University of California, Berkeley, Calif. B.A., M.A., Ph. D. 1933 to 1935-San Jose State College, San Jose, Calif. August 6, 1916-Born Berkeley, Calif. Senator KEFAUVER. You have a statement, sir, and will you proceed and handle it as you wish. We are glad to have you here; we welcome you. STATEMENT OF PHILIP J. FARLEY, SPECIAL ASSISTANT TO THE SECRETARY OF STATE FOR ATOMIC ENERGY AND OUTER SPACE; ACCOMPANIED BY PHILANDER P. CLAXTON, JR., DEPUTY ASSISTANT SECRETARY FOR CONGRESSIONAL RELATIONS; T. H. E. NESBITT, FOREIGN SERVICE OFFICER; ARTHUR L. LEBEL CHIEF, TELECOMMUNICATIONS DIVISION; RICHARD T. BLACK, FOREIGN AFFAIRS OFFICER; AND LEE R. MARKS, ATTORNEY Mr. FARLEY. I appreciate the invitation of the chairman of the Subcommittee on Antitrust and Monopoly of the Committee on the Judiciary to appear here today on behalf of the Department of State. I appreciate also, may I say, the opportunity to hear the very searching discussion which you have had so far of the interest which the peoples and governments, not only of the United States, but of the whole world, have in the successful development of communications satellites, and of the issues which face us as we decide how to do this program best. I have benefited very greatly from this opportunity to hear that discussion. Senator KEFAUVER. Mr. Farley, do you want to introduce the gentlemen with you, Mr. Claxton and others? It is always good to see Phil Claxton. Mr. FARLEY. I think you have introduced Mr. Claxton. I have with me Mr. Lee Marks of our Legal Advisor's Office, Mr. Arthur Lebel, who is Director of the Telecommunications Division of the Department of State, and his associate, Mr. Richard Black, and I have also Mr. Nesbitt of my office. 82357-62-pt. 1-7 |