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reserves. Shortage of personnel and of funds oblige the department to resort to makeshift measures.

(Statement referred to is as follows:)

SPECIAL SERVICE SQUADRON

a Composition.-One light cruiser (Richmond) and two destroyers (Sturtevant ad J. Fred Talbott) (Overton).

Normally based on the Canal Zone, the Special Service Squadron was tered to Cuba on September 5, 1933. Its activities in Cuban waters are dissed under heading F.

Due to the Cuban situation the United States Government during Septemer augmented the forces in Cuban waters under the commander of the Special rvice Squadron by the following vessels: 14 destroyers, 1 supply ship, 1 oiler, !'attleship (Mississippi, New Mexico, and Wyoming in succession), a total of aval vessels; and 4 Coast Guard cutters (ordered to duty under the Navy by the President) and 8 Coast Guard destroyers (ordered to duty under the Navy the President), a total of 12 Coast Guard vessels. The Coast Guard vessels gned to duty with the Special Service Squadron were released on November 1, 1343, from this duty and returned to the Coast Guard by order of the President. that the total under the command of the Commander Special Service Squadron Rear Admiral Freeman) finally reached 32 vessels (Navy and Coast Guard). 4 The activities of all these additional vessels are covered under heading F. The presence of a Special Service Squadron in the important Caribbean 3 area is essential to American interests, and its usefulness demonstrated by *e prompt action in Cuba.

The employment of light cruisers and destroyers on this kind of police duty akes them away from the fleet. They are not proper types for tropical service For many reasons. Gunboats of the sloop-of-war type are the kind of ships we uld have for duty in the Caribbean and Central American waters.

MISSION OF SLOOPS BUILDING FROM N.R.A. FUNDS

Mr. AYRES. Is that the intended mission of the two sloops building out of N.R.A. funds?

Admiral STANDLEY. That is the purpose of that type; yes, sir. In China we feel we ought to come to that type for this special work.

NAVAL TRANSPORTATION SERVICE

Two transports (AP), Chaumont, Henderson: 2 cargo ships (AK), Vega, Sirius; ⚫ai tankers (AO), Ramapo, Salinas; 1 ammunition ship (AE), Nitro. Total-this Depresents reduction of three from the previous fiscal year.

The services performed are as follows: The two auxiliary transports, mont and Henderson, run with passengers and freight between Atlantic ports the Asiatic Station, touching United States Pacific coast ports and Guam

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The auxiliary cargo ships, Vega and Sirius, transport passengers and freight tween Atlantic and Pacific coast ports. They also transport main battery rns between the Naval Gun Factory and Puget Sound Navy Yard. They are only vessels fitted for carrying these heavy weights. One of these ships makes arannual visit to the Bering Sea each year for the benefit of Government activities that area.

The oilers are employed in transporting oil from the oil terminals on the Atlantic Pacific coasts to naval fuel oil depots. They also carry a limited number of sengers and some freight. At concentrations they are assigned to the fleet. Ramapo makes regular runs between San Pedro and Manila to transport oil the fuel storage there.

The auxiliary ammunition ship, Nitro, transports ammunition principally etween Atlantic ammunition depots and the Pacific coast ones, and to the Fleet. Every other year she makes a trip to the Asiatic station.

SPECIAL DUTY

I a.uliary (miscellaneous), 2 survey ships; 3 mobile targets, 2 naval relics, rean tugs, 3 mine sweepers. Total, same as previous year.

DETAILED EMPLOYMENTS FOLLOW

The Gold Star (miscellaneous auxiliary) is the station ship at Guam. It also makes runs to the Asiatic station with mail and passengers. It is a cold-storage depot for supplies at Guam.

The Hannibal (miscellaneous auxiliary) is a survey ship in Central American waters.

The Nokomis (yacht) is a survey ship in Central American waters.

The Hannibal and Nokomis operate on the survey grounds about 9 months annually. The surveys are conducted with consent of the Governments concerned. The areas remaining to be surveyed are sufficient to keep these two ships engaged for a long period in the future.

The mobile targets operate with the fleet.

The Constitution and Grebe have visited in west coast ports.

The ocean tugs are assigned to the naval districts for essential towing services. The mine sweepers perform special duties in naval stations under the bureaus or under the Department.

The vessels assigned to special duties are the minimum the Department can operate without loss of efficiency and economy.

EMPLOYMENT OF VESSELS AT VARIANCE WITH 1933 PROGRAM

The United States Fleet will remain on the Pacific Coast until April 9, 1934, when it sails for the Atlantic coast via the Panama Canal and the Caribbean. In other respects, the employment of vessels has conformed to the 1933 program. The situation in Cuba has been such as to divert about 20 naval vessels from their normal duties, increasing the demands upon appropriations already curailed, and interfering with the necessary training of personnel.

PROPOSED EMPLOYMENT OF VESSELS DURING FISCAL YEAR 1935

FLEETS AND SQUADRONS

(a) The Asiatic Fleet will operate in general as in previous years, carrying out their gunnery and tactical training as opportunity permits. There will be kept continuously in Chinese waters one division of destroyers and the usual patrol of gunboats on the Yangtze River and in other troubled areas. The remainder of the fleet will be in Chinese waters about one half the year and in the Philippines the other half. The employment of vessels on the Asiatic Station is dictated by the special conditions and circumstances that arise during the year, making it impossible to predict exactly where their services will be required for the protection of American interests.

(b) The Special Service Squadron will be employed in the Caribbean and in Central America, unless the situation in Cuba continues to require the presence of considerable naval forces to safeguard the interests of the United States. When normal conditions are restored in Cuba, the Special Service Squadron will be reduced to its usual size (one light cruiser and two destroyers) and the vessels thus released will resume their regular duties.

(c) The Training Squadron will be employed in the annual summer cruise for the midshipmen from the Naval Academy, and in training cruises for the Naval Reservists, provided the ships are available. At present, these vessels are all assigned to special duty in Cuba.

(d) The employment of the United States Fleet, the main strength of the Navy, will be somewhat different than in the past two years. On July 1, 1934, the major portion of the fleet will be operating on the east coast of the United States, leaving in the Pacific the submarines and the aircraft of the Base Force plus two divisions of destroyers in rotating-reserve. During the summer, the fleet will operate from various seaports of the Atlantic Coast, engaging in limited tactical exercises while en route, and about the middle of October will return to the West Coast and resume its regular station. The yearly intensive training in gunnery will be conducted largely from the West Coast bases of the fleet.

DETACHED SERVICE

(a) The vessels on detached service will continue to operate as in the previous fiscal year, with some modification in the details due to the presence of the United States Fleet on the eastern seaboard during the summer and early fall.

FIECT UPON FUEL REQUIREMENTS, CONTRASTED WITH PRESENT FISCAL YEAR AS PLANNED ORIGINALLY AND MODIFIED

1934

For the current fiscal year 1934 the fuel-oil requirements were originally estimated at.. ..barrels 7, 545, 000 >The total sum asked from the Congress for fiscal year 1934, under the appropriation "Fuel and Transportation", was-The Congress appropriated under "Fuel and Transportation' the sum of..

This reduction in the amount asked for reduced the fuel oil to barrels.

Under budgetary action limiting cash withdrawals, the sum appropriated was further reduced to....

! This limitation still further reduced the fuel oil available to

$6,779, 575

$6, 459, 575

6, 910, 530

$5, 077, 000

barrels. 5, 312, 442

The transfer of the U.S. Fleet from the west coast to the east coast will require, as an addition to the fuel oil listed in (f) above, an estimated increase of....... __barrels _ _ This increase in fuel oil is estimated to cost, in round numbers

1935

1, 574, 000 $1,000,000

(a)For the coming fiscal year (1935), the fuel-oil estimates were first prepared the basis of the entire United States Fleet operating on the west coast throughut the whole year. The recent decision to bring the fleet to the east coast and to perate it on this coast during the early part of fiscal year 1935 has introduced certain complications (such as exact date of return to the west coast, questions of overhauling vessels on one coast or on the other with resultant effect upon fuel xpenditures, the exact number of ships to come east and to return west) which ake close estimation of fuel-oil requirements for 1935 impossible until detailed Dans have been approved.

b In general, the figures set up on the original basis of west coast operation the entire fleet plus the oil needed to transfer the fleet back east to west from, ems the best approximation that can be submitted at this time.

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In estimating costs of fuel oil for 1935 the Department has been confronted rising prices and by the necessity for placing contracts for east-coast delivery at higher prices than on the west coast (due to the fleet being east about enths, April to October). The best figures the Department has been able to ave at, and which were presented to the Bureau of the Budget just recently, submitted below:

Aant under appropriation "Fuel and transportation, 1935," for orial requirements of fleet...

Atonal amounts necessary for returning fleet to west coast. 41utional amount for east coast operations of fleet July 1-October 13, 1934...

Total....

$6, 756, 322 2, 000, 000

700, 000

9, 456, 322

The detailed substantiation of these figures will be covered by the Payuter General.

Mr. AYRES. Admiral, the Budget estimate for fuel and transportation for 1935 is $6,661,163, which is on the basis of an average price for fuel oil, which absorbs most of the appropriation, of 60.25 cents per barrel. How are you going to accommodate yourselves to the Budget figure, even assuming that the price paid per barrel does exceed the price used in the approved estimate?

Admiral STANDLEY. As I understand, the oil figures will be given to you later in detail, and I understand that the Budget has incorporated the figures that we asked for in order to make this cruise. I understand that the number of barrels given in the estimates is correct, but that the Bureau of the Budget decided not to get involved with increased cost of material in the Budget, because no one, as they stated, could tell what the increased cost would be.

NAVAL ACTIVITIES ABROAD, INCLUDING RELIEF WORK, SINCE LAST HEARINGS

Near East.-None.

Cuba. Because of unrest and revolution in Cuba, naval vessels have been ordered to Cuban ports not as a threat to the Government in power or to the people but to protect American and foreign nationals and property if found necessary. The presence of American vessels in Cuban waters has not only had a great moral effect in curbing possible anarchy and the consequent loss of lives of foreigners, but by being stationed in every seaport of importance the commanders of these vessels have provided, by means of radio communication, a continuous composite picture of conditions existing throughout this Republic that could not have been obtained in any other way.

Nicaragua. None other than routine visits of vessels of the Special Service Squadron to Nicaraguan ports.

Santo Domingo.-None.

Yangtze Patrol.-Banditry and communism continue rife along the Yangtze Valley, where our Yangtze Patrol continues to afford protection to American citizens and their interests.

The

China. China continues in a state of disruption with internecine strife and communist-bandit activities now engaging the wholesale attention of the Government forces. The Tangku truce witnessed the cessation of active Sino-Japanese conflict and Japan's subsequent policy indicates some ground for optimism in a rapprochement of relations between the two countries. Our naval forces, afloat and ashore, have faced many delicate situations with tact and ability. spread of communism along the South China littoral has frequently necessitated, upon consular request, the presence of gunboats at Amoy, Swatow, and Foochow for varying periods. Their timely presence has had a very steadying effect in these and other cities. Piracy, with attacks on foreign coastwise vessels, remains widespread in the Canton area, where our South China Patrol operates.

The legation guard of United States Marines at Peiping has been maintained with a strength slightly in excess of 500 men. The Fourth Regiment of Marines at Shanghai has remained throughout the period with an average strength of 1,800

men.

FOREIGN PROGRAMS AND POLICIES

STEPS ACTUALLY TAKEN WHICH SHOULD INFLUENCE OUR COURSE

GREAT BRITAIN. The British policy for new construction, as proposed at Geneva, comprises five principal propositions as far as navies are concerned. These may be classified generally as follows:

(a) To limit the maximum size of capital ships of the future to 25,000 tons and possibly even to 22,000 tons.

(b) To limit the maximum size of cruisers of the future to 7,000 tons, armed with no larger than 6.1-inch guns.

(c) To limit the maximum size of aircraft carriers of the future to 20,000 tons, with no larger than 6.1-inch guns.

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(d) Submarines to be abolished altogether, or if retained, to be of a displacement of not more than 250 tons.

(e) Destroyer tonnage to be reduced by one third or by an amount corresponding to the reduction in submarines.

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JAPAN. (a) In March 1933 the Japanese Diet passed the Second Naval Replenishment Program authorizing the construction of the following ships over the 3-year period from 1933 to 1936:

One aircraft carrier, 2 cruisers, 7 destroyers, 6 submarines, 1 minelayer, 2 torpedo boats, 4 minesweepers, 1 submarine tender, 1 gunboat, 2 submarine chasers.

The total authorized cost of the above program is ¥360,000,000; in addition ** täis, an item of ¥100,000,000 for an increase of the naval air force by 5 shoredsquadrons was included bringing the total cost of the program to ¥460,*0.000 At the time of the passage of the program outlined above, the Diet ;ropriated ¥43,850,000 for the fiscal year 1933-34 for the initial installment execution of the program.

Attention is especially invited to the fact that the second replenishment proor cans for completion by 1936 and is in addition to the first replenishment Kram previously authorized requiring a total expenditure of ¥394,400,000 a period of 7 years from 1931 to 1938, ¥374,000,000 of which was authorized e expended by 1936.

MOVES IN CONTEMPLATION OF WHICH WE SHOULD TAKE COGNIZANCE APAN.-A naval building program in lieu of the second replenishment prois now being actively discussed in Japan as her answer to increased United es naval building.

STEPS TAKEN TO CURTAIL EXPENDITURES

GREAT BRITAIN-Vessels.-None. The British are following their usual yearly
Sing program. The new construction program for 1933 is as follows:
Our cruisers, 1 leader and 8 destroyers, 3 submarines, 3 sloops, 1 convoy
"). 1 coastal sloop, small craft.

ite cruisers constitute the fourth and final installment of the replacement cram due for completion by December 31, 1936 under the terms of the London al Treaty. The numbers of destroyers and submarines are the same as in ious building programs since the treaty.

we establishments.-Work is being continued on the Singapore Naval Base. APAN.-Every major item of the 1933-34 naval budget showed a sharp ine over expenditures authorized in 1932-33.

essels. Approximately the same number of vessels was assigned to the three ive fleets and maintained in operation, while expenses for operation as well tre quantities of fuel oil allotted for operations showed a marked increase. hore establishments.-Expenses for the maintenance of the shore establishat while showing some increase over that of the previous year, did not show marked increases recorded for the forces afloat except in those bases and As engaged in the manufacture of arms and equipment where the same sharp reases were noted.

FRANCE-Vessels.-The effect of the French fiscal situation was reflected in A activities in a very small way.

While the Ministry officially announced a delay in construction work for is building (budget cut $13,000,000) authorized funds were apparently d available from previous credits to carry on with all of the work. The 1933 official budget showed $14,705,880 less than the 1932, yet all units *** 1927 and previous programs as well as those of 1929 and 1930 programs cave completed acceptance trials by the end of 1933. All units of the 1931 ram have been laid down except the small scouts. The only delayed work the four cruisers of the 1932 program and the small scouts.

Te budget for 1934 is about $11,000,000 less than the 1933 yet the greater t of this sum is available from appropriations of previous years. Personnel.—The budget carries a preamble to provide for not more than 59,040 ers and men yet the appropriation actually provides for 63,087. (No curent for personnel.)

are establishments.-Cuts have been made only in amount of supplies to be ***ed in stock.

EATY ARRANGEMENTS INITIATED OR CONCLUDED SINCE PREVIOUS HEARINGS

**HÉ OF MOVES AT HOME AND ABROAD SINCE PREVIOUS HEARINGS BEARING UPON LIMITATION OR REDUCTION OF NAVAL ARMAMENT

eva Conference on the reduction and limitation of armaments.

The general commission of the disarmament conference for the reduction and *ation of armaments reconvened on February 2, 1933, and then adjourned on - 29, 1933.

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