HBP5 CONTENTS Harrison, William H., Administrator, National Production Au- thority, accompanied by Manley Fleischmann, general counsel Sawyer, Charles A., Secretary of Commerce, accompanied by Matthew Letters, statements, exhibits, etc., submitted for the record by- Hale, Matthew, Acting Solicitor, Department of Commerce: Memo- randum concerning authority for issuance of transportation orders__ Harrison, William H., Administrator, National Production Authority: 32 DEFENSE PRODUCTION ACT HOARDING AND STRATEGIC MATERIALS WEDNESDAY, DECEMBER 20, 1950) CONGRESS OF THE UNITED STATES, JOINT COMMITTEE ON DEFENSE PRODUCTION, Washington, D. C. The committee met, pursuant to call, at 10:40 a. m., in room F-82, the Capitol, Senator Burnet R. Maybank, chairman, presiding. Present: Senators Maybank, Fulbright, and Capehart; Representatives Brown and Hays. Also present: Hon. Charles A. Sawyer, Secretary of Commerce, accompanied by Matthew Hale, Acting Solicitor, Department of Commerce; and William H. Harrison, Administrator, National Production Authority, accompanied by Manley Fleischmann, general counsel. The CHAIRMAN. The committee will come to order. I called this meeting on behalf of the joint committee, after conferring with the vice chairman. We postponed a previously scheduled meeting from Monday until today. Since then, Mr. Wilson has been appointed Director of Defense Mobilization and his name is now before the Senate, having been approved by the Banking and Currency Committee. He will probably be confirmed today. His nomination is on the Senate Calendar. Therefore, in view of the fact that Mr. Wilson is going to be in over-all charge of everything, I asked him if he could appear before this committee on this coming Friday because I felt certain that Congressman Brown would agree. Mr. Wilson said he would be pleased to appear before the joint committee on Friday at 10:30. In view of this fact, I took the liberty of suggesting to Mr. Symington that he not come since the pertinent duties on control have been removed from his office. Does that meet with the committee's approval? After all, Mr. Wilson will be in my judgment confirmed today and he is going to be the man in charge. Senator CAPEHART. What duty is Mr. Symington going to have from now on? The CHAIRMAN. I would not be able to speak for Mr. Symington. But the connection he had with this hearing was that he testified before us in the committee previously, and he said to ask you, General Harrison, about information pertaining to hoarding. Secretary Sawyer, we were going to discuss with you voluntary controls. As I understood the question at that time, Mr. Valentine and Mr. Di Salle were to be sort of tied in together, if I may use that expres 1 sion, under Mr. Symington. Now the President has appointed Mr. Wilson, and Mr. Wilson is to be here with Messrs. Valentine and Di Salle at 10:30 Friday morning. The VICE CHAIRMAN. I have a reservation to go home. You will not have any other meetings during the holiday season? The CHAIRMAN. Mr. Congressman, I am only asking if it is agreeable to you. The VICE CHAIRMAN. It is agreeable. The CHAIRMAN. I have just mentioned the fact because people have asked me about Mr. Symington, and in view of the fact that the new powers are vested in Mr. Wilson, and in view of the fact Mr. Wilson has not yet been confirmed but will be confirmed today, in my judgment, I thought we would invite him to appear Friday, if it is agreeable to you. The VICE CHAIRMAN. Yes; but we will not have any other meetings? The CHAIRMAN. Not without conferring with you first. Will it be agreeable to meet at 10:30 on Friday with Mr. Wilson and Mr. Valentine and Mr. Di Salle? Is that agreeable? The VICE CHAIRMAN. That is all right. The CHAIRMAN. 10:30 Friday. Will you send the notices out today, Mr. Parsons? Mr. PARSONS. Yes, sir. The CHAIRMAN. Sometime ago, Mr. Secretary-Are you in a hurry? Secretary SAWYER. I am completely at your service, Mr. Chairman. The CHAIRMAN. I appreciate that. What happened to us was that sometime ago Senator Capehart was interested, as I am deeply interested, in the question of hoarding, and we questioned Mr. Symington upon this subject at the time, General, and he informed us that you would know more about that detail than he would. Mr. HARRISON. I would be very glad if there are any questions The CHAIRMAN. This is an open meeting because when I found out neither Mr. Symington nor Mr. Wilson would be present I told Mr. Parsons this would be an open hearing. If you want to say something off the record we can have an executive session later. Secretary SAWYER. This is all on the record? The CHAIRMAN. Yes. Secretary SAWYER. It is all right with us. Mr. HARRISON. Mr. Chairman, does Senator Capehart have some questions? The CHAIRMAN. Senator Capehart. Senator CAPEHART. Since we are going to discuss hoarding, I would like to know what action you have taken under section 102 of the bill, if any. Mr. HARRISON. Why, yes. One of the initial acts was to establish a general inventory order, and then as the additional orders have come forth covering specific materials, that original inventory order has been pinpointed with respect to individual materials, and that has been a progressive matter. Senator CAPEHART. General, I am afraid we are talking about two different subjects. Mr. HARRISON. I do not know. Senator CAPEHART. Section 102 has to do with hoarding. Mr. HARRISON. I am sorry, Senator, I do not know what section 102 is. Senator CAPEHART. Who in the Government is handling section 102 of the act? Are you? Mr. HARRISON. I am sorry; I will have to find out. Senator CAPEHART. Will someone hand the general the bill? Secretary SAWYER. Mr. Fleischmann is here. He is counsel for NPA and perhaps he can answer your question. Mr. FLEISCHMANN. Let me just say this The CHAIRMAN. Come to the table, Mr. Fleischmann. Mr. FLEISCHMANN. Yes, sir. The NPA has that authority under section 102. Our actions have been taken under the other section up to the present time. Senator CAPEHART. Then your answer is that nothing has been done under section 102? Mr. FLEISCHMANN. No action has been taken under section 102. Senator CAPEHART. With respect to hoarding? Has the President designated these strategic materials, spelled them out, or have you gotten any orders as to what they are? Mr. FLEISCHMANN. Let me say this: We have taken very definite steps in the inventory field. We have not designated scarce materials under section 102. For certain reasons, which we thought were adequate, we have started off under section 101 at the present time. I think that is the question you are asking, Senator. The CHAIRMAN. Yes. Senator CAPEHART. When do you propose to put into effect section 102? Mr. FLEISCHMANN. I find that difficult to answer for this reason: The reasons that we have used section 101 up to the present time are that we considered in the first place, with a very small organization, the problem of compliance under section 102 would be an enormously difficult one until we got better staffed up. Secondly, we considered that under section 101 we had a more selective approach, which in the early stages would be a better one. We have, as you know, put out an inventory regulation order, and, as General Harrison says, we have also proceeded from the general to the specific by regulating certain materials much more strictly; for example, a 45-day inventory in some materials and a 60-day inventory in others. Senator CAPEHART. You published that then in the Federal Register? Mr. FLEISCHMANN. Yes, sir. Senator CAPEHART. Section 102 has to do with hoarding? Mr. FLEISCHMANN. Yes. Senator CAPEHART. Is it not a fact there is a tremendous amount of hoarding going on? Mr. FLEISCHMANN. I assume that is true. I do not have that information officially, but I think everyone would agree there is some going on. Secretary SAWYER. I think you should make a distinction, Mr. Chairman, between a tremendous amount and some, in Mr. Fleischmann's answer. I happened to participate in a meeting at Chicago about a month and a half ago of businessmen and others, and there was one organ |