NATIONAL DEFENSE ESTABLISHMENT-UNIFICATION

OF THE ARMED SERVICES

TUESDAY, APRIL 8, 1947

UNITED STATES SENATE, COMMITTEE ON ARMED SERVICES, Washington, D. C.

The committee met at 10 a. m., pursuant to adjournment, in room 212, Senate Office Building, Senator Chan Gurney (chairman) presiding.

Present:Senators Gurney (chairman), Robertson (of Wyoming), Saltonstall, Morse, Tydings, Byrd, and Hill.

The CHAIRMAN. The committee will come to order.

Continuing the hearing on S. 758, we have with us this morning W. John Kenney, Assistant Seceretary of the Navy, and Vice Admiral Robert B. Carney, as well as Under Secretary of War, Kenneth C. Royall.

We will hear from Assistant Secretary Kenney now. proceed in your own way, Mr. Kenney.

You may

STATEMENT OF ASSISTANT SECRETARY OF THE NAVY W. JOHN KENNEY, NAVY DEPARTMENT, WASHINGTON, D. C.

Mr. KENNEY. Thank you, Mr. Chairman. My statement is directed primarily toward the problem of supplying a military establishment and the character of organization best designed to do that--with particular emphasis on purchasing and procurement. I am stressing that phase of the problem of logistics because of the interest that has been evidenced in it. If the committee desires an amplification on the other phases, the Deputy Chief of Naval Operations for Logistics, Vice Admiral Carney, can explain from the military point of view how requirements are determined and how material procured is delivered to the fleet.

S. 758 will, in my opinion, create a more efficient organization. It makes possible a military establishment that is both responsive to military needs and to the related diplomatic and industrial requirements. However, the ultimate determination of the effectiveness of any military organization is proven only by its ability first to prevent war, and second if war occurs to win that war. The procurement of material to supply a military establishment is a function of service and to that extent is a subordinate and ancillary function. Its importance should not, however, be underestimated as it is the foundation on which the fighting force rests. The supply organization must be properly related to the military establishment it supports or the efficiency of the latter will be affected.

A supply organization must be able (1) to provide for expansion in time of war without disruption of organization or reassignment of functions; (2) to have the flexibility to respond to operational and technical requirements; (3) to provide strategic dispersion of stocks and records within practicable limits; (4) to have effective coordination with all operating and technical agencies of related organizations within and without the Government; (5) to permit economy of operation through mobility of support and control of material.

A supply organization must be a part of the establishment which it serves. The military establishment is charged with the responsibility of fighting a war and it is implicit to me that this responsibility should carry with it the correlative duty to design, engineer, and procure the weapons with which it fights. To set up a separate organization gives undue significance to a subordinate function, dilutes the effectiveness of command, and would result in delays and compromise and ineffective weapons.

The statement which Judge Patterson made before the Truman committee in December 1942 on this general subject is as appropriate today as it was at the time it was made. I am quoting from what Judge Patterson said then :

It is sometimes said that the armed forces should say what they want and when they want it and that another agency should attend to producing the weapons. This sounds fairly plausible. In fact, it would result in a devision of responsibility in a field where single responsibility is of prime importance. The steps involved in production of weapons for war, from design through to inspection, delivery, and field maintenance, represent a continuous flow and should be under single control. The suggestion also overlooks the necessity for constant change in weapons. What is wanted is always being changed as the result of combat and there would be constant collisions between those stating the needs and those charged with supplying them.

The dangers of the divorcement of procurement from the ultimate user of the weapons procured is well illustrated by the experience of the British Fleet Air Arm. It is well known that the British naval aviation was an orphan while it was in the Royal Air Force, but the point I want to make here is that this slighting continued long after it was returned to the Royal Navy because it was deprived of the right to procure its own material. The procurement of all British aircraft, including that for the Fleet Air Arm, and the responsibility for the design of all aircraft and engines was vested in the Ministry of Aircraft Production. The Admiralty merely has a representative at this Ministry to look after its interests. The inability of the British naval aviation to procure its own aircraft led to its notoriously low standard of performance, largely because naval aviation did not receive treatment equal to that of the Royal Air Force in the procurement of the Ministry of Aircraft Production. It is this type of historical example that creates concern in the Navy in any suggestion for a centralized purchasing agency, and these criticisms can be as forcibly directed at a separate procurement organization within a military establishment.

At this time I would like to point out that a different problem is presented in the procurement of supplies which are susceptible of common use among the different services. This problem is to be discussed in more detail later in my statement. Procurement of combatant vessels by the Navy, tanks by the Army, and strategic long

range bombers by the Air Force does not involve the operation of competing procurement systems. These weapons are unique to the service procuring them and should be purchased by that service which must depend upon those weapons for the performance of its military responsibilities; otherwise it would not only be unwise, from a military point of view, but uneconomical.

Senator ROBERTSON. May I interrupt you there?

Mr. KENNEY. Yes, Senator Robertson.

Senator ROBERTSON. Then do you also believe that the appropriations for the purchase of these combatant vessels for the Navy, tanks for the Army, long-range strategic bombers for the Air Force, the Navy planes, both carrier- and land-based, and the Marine Force amphibious equipment should be ordered and bought and appropriations made by those various forces that are going to use them?

Mr. KENNEY. I think those weapons which are unique to the service which uses them should be purchased by that service, and appropriations should be made to that service for their purchase.

Senator ROBERTSON. And would you go so far as to say that there should be no authority that could in any way upset those appropriations or transfer them, once made, to any other section of the forces? Mr. KENNEY. I don't think I would go that far, Senator, because it seems to me that there are certain inherent rights of command which are vested in the Joint Chiefs of Staff, to, possibly, change certain functions around. Thus, the needs of a particular campaign may require a greater number of one type of weapon than another. Therefore, it would seem to me that it would be perfectly proper for the Joint Chiefs of Staff-and they should so do-to determine that you need weapons of this character, and therefore the Navy or the Army should not purchase weapons which might possibly be said to compete with those; not compete in the sense of the identical weapon, but compete in the sense of the material which goes into them.

Senator ROBERTSON. I understand that, as far as actual warfare is concerned; but during peacetime you feel that each arm of the services should have the power to order and procure the particular needs of that service?

Mr. KENNEY. I do, Senator.

Senator ROBERTSON. Other than the general things, such as coal or lumber, which are utilized by all services equally?

Mr. KENNEY. That is correct.

Senator ROBERTSON. You would also feel, then, that when the Secretary of War, the Secretary of the Navy, send budget requirements to cover those various items, they should not be subject to change by any other body, except possibly the President?

Mr. KENNEY. I don't think I go that far, Senator, because I think we are all in one family, and there may be only so much money for the family to spend. Therefore, I think the decision has to be made. as to how much each one of the children is going to get.

Senator ROBERTSON. Well, how would you avoid one child being a pet and getting a little more than one of the other children, a bigger slice of cake, for instance?

Mr. KENNEY. Well, I think there is plenty of protection as to that in the powers which the Secretary of National Defense has, the powers which the President has, and also the powers of the Congress over

appropriations. And don't forget that each one of the services is represented on the Joint Chiefs of Staff; they are represented on the Army-Navy Munitions Board. So I am not worried so much about one child becoming a pet, as long as we have that form of organization. Senator SALTONSTALL. I cannot help saying, Mr. Kenney, that as the father of five children you understand those problems in the domestic way, do you not?

Mr. KENNEY. No, it is only four; or was, at least, when I left home this morning.

Senator TYDINGS. Unification only goes to four branches of the service in your family.

Senator SALTONSTALL. I should like to refer you to section 113 (c), subparagraph (3), on page 15. What you have said does not seem to agree with that. Do you think it does?

Mr. KENNEY. I was not aware of any difference. It gives the function to the Munitions Board, "to coordinate the appropriate activities within the national defense establishment with regard to industrial matters, including the procurement, production, and distribution plans of the establishment," which I think is entirely appropriate.

Senator SALTONSTALL. And "for the greatest practicable allocation of purchase authority." That is what I had in mind.

Mr. KENNEY. Well, that point I go into at a later time. Because it is my feeling, and I believe it is a feeling which is concurred in by the other members of the Munitions Board, that the greatest practical form of procurement of items which are common items, is to assign the procurement of those items to existing organizations rather than possibly creating another organization. Thus, food, which is a common item to both the Army and the Navy, is purchased by the Army for the Navy. And I think that is a far sounder form of organization than to create a separate supply organization, which would purchase food for both the Army and Navy. Both the Army and the Navy are going to have to have procurement organizations to produce those items which are unique to their own service.

Senator TYDINGS. Mr. Kenney, in time of war, when you have to buy great quantities of food, do you find it desirable to take expertsfor example, in the meat line-and commission them temporarily in the Army and Navy to handle the purchasing of that particular item? And in the event this division is made between the general supplies and the special supplies, so to speak, to what extent would that reduce the personnel of the Procurement Division of the Navy, if this bill goes through?

Mr. KENNEY. I don't think I can answer that, Senator Tydings, because I would not know what procurement functions would be transferred to the Army and what would be transferred to the Navy.

Senator TYDINGS. Well, assuming that these special services that you and Senator Robertson were discussing, like ships and long-range bombers and things of that sort, were retained by each service, to what extent would the transfer of all other things to the central agency diminish the procurement force in each of the three independent branches?

Mr. KENNEY. I had not contemplated that there would be a transfer to a central agency to do that, because I think that is an unwise thing. Senator TYDINGS. I mean for general things, like food.

Mr. KENNEY. I am speaking of general things, too. I think that you are going to have procurement organizations in the Army, Navy, and the Air Forces. You have to have them. It would be unwise to take the procurement of these unique items away from

Senator TYDINGS. Let me put it to you in a different way. Would this procurement service, made up in part of the Army, Navy, and Air Forces, all be in one place, or would it function in independent agencies?

Mr. KENNEY. The procurement service would function in independent agencies.

Senator TYDINGS. So that as far as the procurement of general supplies is concerned, there would basically be no change in the present set-up under your plan?

M. KENNEY. Except insofar as we would increase the allocation of purchases between the services; and I think there is still a lot that remains to be done in that field.

Senator TYDINGS. You could do that without this bill?

Mr. KENNEY. Yes, you could do that without this bill; but again, you have the frailties of human nature involved. Will you always have Secretaries who will cooperate as well as the present two Secretaries have?

Senator TYDINGS. My qustion springs from this thought: I think most of the laymen in the committee and in Congress and in the country have the idea that when you, so to speak, effect a concentration of the various procurement functions, ordering that the Army purchase the food and the Navy purchase something else, and so on, there is set up what might be termed a separate procurement agency. That is not your idea at all?

Mr. KENNEY. I am not in favor of that. I think that would be both unsound from a military point of view and uneconomical as well. Senator TYDINGS. To what extent do we get efficiency into procurement under this bill, where we would not have it if we did not have the bill?

Mr. KENNEY. Well, the greater efficiency you get is, I think, spelled out in the powers which are vested in the Army-Navy Munitions Board to do certain things in this field. Today it is purely a matter of voluntary agreement between the services. True, the Army-Navy Munitions Board and its Chairman have been given certain specific authority to do that, but that is really the result of an agreement between Secretary Patterson and Secretary Forrestal. This statute vests the authority in the Army-Navy Munitions Board to say that one service shall purchase certain things when they feel that would be more economical. Senator TYDINGS. That answers my question. So the net result of adopting this bill woulld be to place a power somewhere that could force more unification than might take place voluntarily.

Mr. KENNEY. That is correct, Senator.

Senator TYDINGS. And otherwise the thing would remain pretty much the same; the difference being that where voluntary agreements are effected very slowly, under the bill they could be accelerated, in the interests of both efficiency and economy, I take it.

Mr. KENNEY. That is right, Senator.

Senator TYDINGS. And no other change in your philosophy of approach to this thing ought to be adopted?