Colonel KUTZ. Very well, let us take the flare bomb. There is the cost of inspection, of course. There is the cost of transportation. If it has to be assembled with a parachute from another place, there is the cost of transportation of the components to make up the complete item. It is all an inherent part of the cost of the finished item. Mr. ENGEL. What I am getting at is this: You had some bids for flare bombs, and I understand that those bids were around $50 apiece. Colonel KUTZ. For which bomb? Mr. ENGEL. M-26. Those bids were opened sometime ago, and I believe the price was $50 apiece for the assembled bomb. Colonel KUTZ. I would have to check up on that. I have no personal knowledge of that. Mr. ENGEL. Suppose that were the bid for the assembled bomb; you would have to add to that the transportation from factory to where? Colonel KUTZ. To the point of storage or issue. Mr. ENGEL. Are there any other items that go in there? Mr. ENGEL. Proof testing? Colonel KUTZ. Yes, sir. Mr. ENGEL. Are those proof tests made before or after? Mr. ENGEL. Would that add a cost of as much as $15? Mr. ENGEL. Suppose that it costs $55 complete, proof testing and everything; what would happen to the other $10? Colonel KUTZ. You would save $10, which would be reported, toward the end of the fiscal year, to the General Staff, to be applied against shortages in the existing program. Mr. ENGEL. It would be applied against shortages? Colonel KUTZ. Yes, sir. Mr. ENGEL. In other words, you would take those overages on this bomb and apply it against a shortage, let us say, in a rifle item? Colonel KUTZ. That is correct; yes, sir. Any prudent manufacturer must have certain operating reserves. You may, for example, originally estimate that a tank is going to cost $50,000, but when you put all the newest gadgets in-put a new turret on it, add armor and armament, and do other things to it-it may bring the unit cost up to $65,000, and you have requested the Congress for money for a thousand of them at only $55,000 each. So you are going to be short. But, on the other hand, you may get bombs for a lesser unit price than you anticipate. But if your overages and shortages do not balance, in the final analysis, you have to come to Congress for a deficiency appropriation. The CHAIRMAN. If there is nothing further, thank you, Colonel Kutz. That concludes the hearings, gentlemen. TUESDAY, JANUARY 20, 1942. LOCATION OF PLANTS FOR MANUFACTURE OF DEFENSE ARTICLES STATEMENT OF HON. JOHN J. COCHRAN, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF MISSOURI Mr. COCHRAN. Mr. Chairman, I appreciate the opportunity to comment upon the request of the President in his message of January 16 for supplemental appropriations totaling over twelve billion dollars. The point that I want to bring out is that while I realize it is not feasible to place the locality in an appropriation bill, nevertheless, I hope this committee will let those who are going to be responsible for the expenditure of this tremendous sum know that it would be advisable in expanding or constructing new plants to locate them in some place in the country other than on the seacoast. We find today that some of the largest aviation plants, as well as munition plants, are close to our seacoast and as a result there is an added responsibility upon our Navy to be on the alert at all times to defend those most important manufacturing plants in the event of attack. As the President pointed out in one of his speeches, even the center of our country is not immune from attack, but common sense tells us it would be safer to have an airplane factory or a munitions plant in the center of the country rather than along the coast. It is for that reason that I express the hope that the committee will let the War and Navy Department officials know that it is the feeling of the committee that the safest place to manufacture defense articles is in the center of the country rather than along the coast. Airplane production, rate of.. Air Corps officers, age of Airplane program in President's message_. Airplane-production program with pilot-training program, coordina- tion of__ Page 10, 50 2 |