Secretary BURGESS. It is clear that a civilian career offers the possibility of much greater reward than does the military career. This comparison was taken from the most recent review of civilian and military pay by the Hook Commission-March 1954 and is current through calendar year 1953. Based upon information reported by 42 major companies, the pay of their presidents was increased by 10 percent and their vice presidents by 16 percent during the period 1948-53. These increases are exclusive of bonuses or other forms of deferred compensation.

Mr. MILLER. Mr. Secretary, this chart here, is this supposed to be the average officers earning capacity in private industry?

Secretary BURGESS. Yes; a comparison of the ranges of compensation for comparable responsibilities.

Mr. MILLER. The average first lieutenant can go out according to that chart and earn about $800, and the average captain can go out, or the average major and earn about $1,100 a month?

Mr. PATTERSON. Not according to the people who come to see me. Mr. MILLER. I have just had a brigadier general giving me as a reference to this plus-40, and I know some retired colonels who certainly, regular Army, West Pointers, who haven't been able to find jobs that would pay them anything of that nature. I am just wondering whether this-now, we know that there are people, major general

Mr. BLANDFORD. Mr. Miller, this is based upon a comparable responsibility in industry.

Secretary BURGESS. Comparable responsibility.

Mr. MILLER. Wait a minute. Comparable responsibility, there is a lot in that, and there is a lot in a man's capacity. There are many men who would take the job as president of General Motors, but there is only one president of General Motors.

Mr. BLANDFORD. What the Hook Commission tried to do originally back in 1949, and they spent months and months doing it, they went, for example, to an industry, we will say, that employed 18,000 men, which had an investment of $150 million which would be comparable to a division commander's responsibility.

Mr. MILLER. Oh, well, yes.

Mr. BLANDFORD. That is the way they arrived at it.

Mr. MILLER. But in the hurly-burly of getting jobs in private industry I don't know of many people who could earn $38,000, $40,000 a year. You haven't as many $40,000 a year jobs hanging around as you have major generals.

Secretary BURGESS. You don't have them hanging around, but they exist and there are responsible ones.

Mr. MILLER. There aren't many people who can assume that.
Secretary BURGESS. That is right. But they do exist, sir.

Mr. MILLER. Surely. It isn't a question of capabilities, it is again the subject of earning power. I think that this thing is distorted out of all reason as far as I am concerned, it looks as if somebody is trying to sell us a bill of goods.

Mr. WILSON. This says comparable responsibility. It doesn't say earning capacity.

Mr. HARDY. What does that responsibility refer to?

Does that refer to the assets that the individual handles?

Secretary BURGESS. It would be assets and leadership, number of people employed, the job to be done.

Mr. RIVERS. Security?

Secretary BURGESS. That is right, sir.

Mr. RIVERS. Take a commandant of the navy yard, for instance, or a captain of the yard, or the commander they call him now, he has a staggering responsibility, the same way

Secretary BURGESS. That is right. If you try to compare it on the other side, if you put these on responsibility lines instead of just on dollar lines, the people in the military in some of these grade ranks would be much

Mr. MILLER. I would like to say off the record.

(Discussion off the record.)

Mr. MILLER. We are going to compare them to responsibilities, we are going to compare them to earning power of the people outside. If your-if you are going to bring industry into it, I just got through testifying before the Post Office and Civil Service Committee and I wouldn't dare make the same comparison there, if we did we would have the Postmaster General with a billion and a half dollar establishment paid way up to the ceiling.

Mr. RIVERS. I know.

But he is a Cabinet officer.

Mr. MILLER. That is right.

I agree that the Cabinet officers are underpaid, and I agree that you do things in public life and we all know that. But the question is when you put these master sergeants, one thing or another, second lieutenants, down at earning capacities where men can go out and get jobs, but when you bring this thing up

Mr. RIVERS. The Chair would like to say this: I know of nobody else I would rather quote than the Hook Commission, who in my opinion have done a wonderful job. They did it for nothing. Mr. Hook worked for no pay.

Secretary BURGESS. I know of no one better qualified than Mr. Hook from the standpoint of knowing what the average experience is in industry and because of his affiliations with the Business Advisory Council.

Mr. BLANDFORD. May I say that this works in reverse.

There have been attacks made on pay increases for the armed services because comparisons are made with civil-service jobs, and the military.

In other words, I have seen, and I am sure all members of the committee have seen, the studies that have been made, showing that a captain with his pay allowances receives more pay all told than a P-9 in the civil service.

Now, that comparison in my opinion is just as much subject to criticism as the comparison you have here because the Hook Commission was faced with the problem of trying to make a comparison with something that people could understand. There is nothing as uneconomic as a military installation of course, because it is a complete dead loss to the Nation. I mean, there is nothing constructive about the armed services insofar as the economy is concerned, with all due respect to these gentlemen here.

But nevertheless, they had to go out and make some kind of a comparison, so they could bring something to us and say this is how we analyze what a young man would be making on the outside if he were doing a job such as line sergeant, in a communications section, then they went to the telephone company and they found out what a man did who worked about as long and had about the same responsibility and then they came in with those comparisons.

Maybe they are not good, but that is the best they can do.

Mr. MILLER. I think those are excellent.

But when we do that, on the left side we allow our imagination on the right of the chart to run away. I think that chart, taken on the floor of the Congress, would just about knock this bill in the head. Mr. WILSON. Off the record.

(Discussion off the record.)

Mr. RIVERS. Go ahead, Mr. Burgess.

Secretary BURGESS. While the military career offers traditional rewards which are not measurable in money, there is no question but that the tangible incentives of a civilian career offer greater inducements today.

The fundamental objective of the proposed Career Incentive Act is to attract young men to a military career and to retain them in this career once they have chosen it. In addition it is necessary to offer special incentives to men who undertake the particularly hazardous jobs that are becoming more important as weapons systems become increasingly faster and more complex. These objectives require compensation more in line with that offered by private industry. (The chart is as follows:)

THE PROPOSED CAREER INCENTIVE ACT HAS BEEN DEVELOPED TO
ASSURE THAT THE PAY STRUCTURE WILL;

• BE IN BALANCE WITH LEVELS OF SKILL, RESPONSIBILITY
AND LEADERSHIP

OFFER COMPETITIVE INCENTIVES FOR THE CHOICE OF
A MILITARY CAREER

ASSURE ADEQUATE CAREER PROGRESSION

⚫ PROVIDE A DIFFERENTIAL BETWEEN OBLIGATED SERVICE
AND CAREER SERVICE

OFFER ADEQUATE PERCENTAGE DIFFERENTIAL FOR
PERFORMANCE OF HAZARDOUS DUTY

CHART 16

Secretary BURGESS. The proposed Career Incentive Act has been developed to assure that the military pay structure will:

Be in balance with levels of skill, responsibility, and leadership;

Offer competitive incentives for the choice of a military career;
Assure adequate career progression;

Provide a differential between obligated and career service;

Offer adequate differential incentive for performance of hazardous duties.

Salient features of the proposed bill are (1) selective increases in base pay and incentive pay for hazardous duty; (2) provision for a "dislocation" allowance for personnel with families making a permanent change of station; and (3) an increase in the maximum per diem allowance for temporary duty travel.

We have directed our efforts to the development of a plan which would increase the career attractiveness of active military service. In so doing, we have followed a philosophy which places emphasis on the personnel needed to man our active forces.

An important feature of the plan we propose is that no increases are provided for officers with less than 3 years of service and warrant officers and enlisted men with less than 2 years' service. Increases are proposed only for those individuals who serve beyond the minimum obligated service. This highlights the career incentive feature of the bill.

This final chart shows the results of a just completed survey by the Air Force of 5,700 officers and men.

(The chart follows:)

AN AIR FORCE SURVEY OF 5,700 OFFICERS AND ENLISTED MEN INDICATES THAT THE OBJECTIVES OF THE CAREER INCENTIVE ACT CAN BE ATTAINED

Secretary BURGESS. This survey indicates that the enactment of the proposed Career Incentive Act would have a compelling effect in the choice of a military career for a significant proportion of those who face the decision.

The columns on the left represent the percentage who planned to serve on a career basis under present pay scales; the columns on the

right, the percentage who would elect a military career under the proposed Career Incentive Act scales.

Particularly significant is the increase in the number of young flying officers and enlisted men who would plan a service career if the proposed pay scales were placed into effect.

An additional 13 percent of the flying lieutenants indicated they would remain in the service on a career basis if the proposed Career Incentive Act is enacted.

An additional 5 percent of all enlisted personnel surveyed would remain in career status, and an additional 7 percent would stay in for 1 more enlistment. This would indicate that we might expect a 12percent increase in the reenlistment rate.

The 20-percent change in the attitude of ROTC flying lieutenants is most encouraging. These young men are now trained for either a civilian or military career and are college graduates. An increase in the retention of officers from this source in the face of the present necessity for commissioning a high proportion of flyers with only a high-school education would be of untold benefit to the Air Force. Mr. BLANDFORD. Are these percentages or numbers of people? Colonel STEPHENS. These are percentages.

Mr. BLANDFORD. 57, then you go up to 65.

Then on the top of that, there is an additional 2 percent

Colonel STEPHENS. Actually, a 7-percent differential for 5 years or longer.

Mr. BLANDFORD. I see.

Secretary BURGESS. The survey indicates that an additional 20 percent of these ROTC lieutenants would remain in the service on a career basis.

While this survey deals only with attitudes in the Air Force, it is reasonable to believe that similar reactions would be encountered in the other services.

The President said in his special message to the Congress on January 13, 1955:

In my judgment, the measures herein presented will strengthen our security and preserve our way of life.

The proposed Career Incentive Act is considered by the Department of Defense to be a vitally important measure, both to our military people, and to the sustained security of the Nation.

I shall not undertake a detailed analysis of the bill itself. The personnel chiefs of the services are here to discuss the problems of their respective services. In addition, Capt. David L. Martineau and other members of the Department of Defense staff are prepared to go into a detailed analysis and explanation of all features of the proposed bill. Mr. RIVERS. Thank you, Mr. Secretary. That indicates a very fine and a lot of hard work, and the fact that our chairman, Mr. Vinson, has got one committee sitting on the Reserve problems, and another on the regulation, indicates our determination to go right along with you and give you every possible cooperation.

Secretary BURGESS. Thank you, Mr. Chairman.

Mr. RIVERS. We want to thank you for a fine statement.
Now, tomorrow, Mr. Blandford, 10 o'clock?

Mr. BLANDFORD. Yes, sir.

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