sale of Government-owned merchant ships, H. R. 4486. Extensive hearings have been held on such bill at which representatives of industry, labor, and this Commission have been heard. In its present draft the bill establishes appropriate minimum prices for war service vessels with a view to avoiding a break-down of the policy established by Congress under the Merchant Marine Act, 1936. Whether or not such bill meets with the approval of Congress. it is my belief that the disposition of merchant shipping should be the sjbject of specific legislation enacted by Congress after consideration of the economic, defense and international aspects of the problem. STATEMENT RELATIVE TO THE PROPOSED SURPLUS PROPERTY ACT OF 1944, BY E. L. OLRICH, ASSISTANT TO THE SECRETARY, TREASURY DEPARTMENT The Treasury Department, Procurement Division, is now functioning as a disposal agency under the Executive order. If we are so designated by the Administrator under this proposed act, the Procurement Division of the Treasury Department believes it can function effectively and satisfactorily under its framework. The Treasury Department approves this bill in general. The Treasury Department participated in discussions leading to the formulation of this proposed legislation. CHAMBER OF COMMERCE OF THE In re: H. R. 5125. Hon. CARTER MANASCO, Chairman, Committee on Expenditures in the Executive Departments, DEAR SIR: The bill now before your committee by Representative Colmer, H. R. 5125, would provide a basis in legislation for the disposal of great Government-owned war plants and real estate no longer needed for purposes of national defense and of vast quantities of surplus supplies that will occur at the close of hostilities. The Chamber of Commerce of the United States believes that a procedure of orderly and efficiently administered handling of war surpluses is the only one which can be countenanced in contemplation of the huge magnitude of such surpluses and the great need that will exist for the prompt resumption of civilian production on an adequate scale to facilitate our transition from war to peace. These surpluses must be so demobilized as to preserve the stability and productivity of the national economy and avoid unnecessary interference with the maintenance of a high level of private employment. In view of the foregoing considerations the chamber attaches great importance to the content of the legislation to be enacted by the Congress. The chamber has given long and careful consideration to the subject. Its recommendations were developed by a large and representative committee of business and industrial executives following many months of study and discussion. A list of the members of this committee is appended. Some of the chamber's proposals for legislation are provided for in H. R. 5125. Other significant proposals have not been incorporated which the chamber believes should be given serious consideration. The following discussion is devoted primarily to these proposals. ADMINISTRATIVE ORGANIZATION The bill, H. R. 5125, would provide for a Surplus Property Administrator, and he would have general supervision and sole direction over the disposal of surplus property except with respect to the disposal of certain aluminum and synthetic rubber plants. There would be, also, a surplus property advisory board composed of representatives of 15 designated Government departments and agencies. The sole purpose of this board would be to advise and consult with the Administrator. Independent agency. The chamber recommends that responsibility for (1) the interpretation of the policies laid down by Congress in the legislation; (2) the promulgation of procedures to be followed in disposal; and, (3) general administrative action based upon these policies and procedures should be the responsibility of an agency outside of any executive department of the Government and responsible to Congress in the carrying out of the will of the Congress. The problems that will be confronted in surplus property disposal when hostilities cease will be so complex and have such far-reaching effects upon the domestic economy that nothing short of such an independent agency will meet the needs of the situation. The agency recommended by the chamber would be a commission of seven fulltime members to be nominated by the President and approved by the Senate, each member to have had at least 5 years' industrial or merchandising experience. The fact that an independent commission is recommended does not carry with it the implication that every administrative decision would depend upon and await the affirmative vote of the seven members of the commission. In the execution of its functions as a policy-making body the commission would act as a unit. With respect to some administrative decisions of far-reaching effect the commission would also act as a unit. For example, there will be numerous manufacturing plants which cost the Government many millions of dollars. Each case will require careful study before a sound decision can be reached as to whether the plant shall be sold or demolished. Decision with respect to the disposal of these plants would be reached by the entire commission following the study of carefully prepared reports devoted to the engineering and economic factors involved. With respect to most administrative matters, however, the chairman would be authorized to act upon his own responsibility. He would be empowered also to delegate administrative authority in the same manner as is contemplated by H. R. 5125 which would authorize the designation of "disposal agencies." Advisory board The surplus property advisory board, which would be established by the bill, would not be a satisfactory substitute for the commission which the chamber recommends. The board, as stated heretofore, would be composed of representatives of 15 designated Government departments and agencies. The members of such a board would be officials concerned with the operating problems of their particular departments and thus, in most cases, out of intimate touch with the problems of industry and trade in a peacetime economy. Moreover, the department representatives would devote but a small part of their time to the matters laid before the advisory board. In short, there would be no assurance that such an advisory board would be composed of persons adequately equipped for the rendering of the sound advice that would be needed on the solution of difficult economic problems. It is recognized, however, that there would be a place for such a board composed of representatives of Government departments. Such a board would serve a very useful purpose in connection with the establishment of administrative procedures. Industry advisory committees. The Chamber recommends that specific industry advisory committees be authorized by the act of Congress to be appointed by the commission after consultation with each industry as to their composition. The act should specify that advisory committees must be truly representative of the recognized functions in production and distribution. Its members should be from large and small units with due recognition for geographic considerations. There is no provision in the bill, H. R. 5125, for the establishment of advisory committees. While it is probable that the Administrator would consult with representatives of industry from time to time, the bill, as now written, would not require him to take this step. The omission of this provision is unfortunate. În providing for advisory committees in the legislation, it would seem desirable to make provision similar, perhaps, to that contained in the Smaller War Plants Corporation Act of June 11, 1942 (56 Stat. 357), so that members of advisory committees in the exercise of the duties assigned them by the surplus property disposal agency would not be inhibited in the rendering of advice by fear of prosecution under the antitrust laws. BASIC PRINCIPLES AND POLICIES The chamber recommends that the legislation should establish basic principles and policies to guide the commission in the conduct of its operations. The bill H. R. 5125 does not go as far with respect to the statement of underlying principles and policies as the chamber considers desirable. This is particularly the case with respect to principles to be followed in connection with the disposal of government-owned war plants, real estate, and other facilities. Disposal of plants and real estate. The law should require that decision be made at the earliest possible moment as to which plants and equipment, other facilities and real estate must be retained for essential military purposes. The remainder should be earmarked for orderly demobilization to private industry, and such plants and other facilities as are not suitable for such disposal should be scrapped. The disposal of plants and other facilities and real estate should be handled in such a manner as to encourage competitive efficiency on the part of private industry. In this disposal, the welfare both of the Nation and of the locality should be taken into consideration, but in no case should any particular locality or enterprise be subsidized or given any preferential advantage at the expense of taxpayers generally or in any other manner. It will be a natural desire of communities and of their representatives in the Congress to preserve for those communities great Government-owned manufacturing plants, even though the Surplus War Property Commission may know that engineering and economic studies reveal that the preservation of such plants is not in the public interest. Pressure from any source for the utilization or disposal of Government-owned war plants in a manner which is not in accord with broad public interest must be resisted. It is the belief of the chamber that an independent commission, constituted as described, is the agency which will give the best assurance of unbiased and competent decision. Disposal of surplus supplies in the United States. The chamber believes that the underlying objective in the disposal of surplus war supplies that are located in the United States should be their economic use in this country or their disposal abroad for the ultimate benefit of the American economy. This should be accomplished with a minimum disruption of production and trade and with the least practicable interference with normal employment. Surplus supplies should be disposed of as rapidly as consumers demand such goods during the period which must elapse before normal production can be resumed. On the other hand, the sale of surplus supplies should not be pushed at a time when business generally is uncertain or declining. Such a course might induce or accentuate a depression. Quantities of surplus supplies and materials released for sale should be in lots which will permit participation by small as well as by large manufacturers and retailers, and any price differentials between large and small lots should be limited to actual differences in cost of handling and distribution. So far as practicable, surplus supplies and materials should be redistributed by the industry that produced and distributed them. These recommended principles and policies appear to be adequately reflected in the provisions of H. R. 5125. It is appropriate, however, to refer again to the recommendation respecting industry advisory committees. As has been stated, these committees should be appointed for the various industries with provision for appropriate subcommittees for imprortant branches of each industry. The commission or its individual members should convene industry advisory committees from time to time; lay before the committees all the facts respecting the surplus supplies within the cognizance of the committees, including information as to grades, qualities, condition and locations of the inventories; and solicit the advice of the committees on the manner and time or times of disposal. These requirements might well be stated in the law because, as the chamber believes, the disposal of surplus supplies will then take place in the most orderly and effective manner with the least disturbance to production and trade and a minimum interference with employment. Surplus supplies held abroad. The bill makes no provision with respect to special problems that will be confronted in connection with the disposal of surplus supplies and facilities which will be located in many places all over the world. The surpluses in question are those which are competitive with the products of the United States and not to supplies, notably raw materials, which have been bought for use in the United States. The Chamber recommends that the surplus property legislation should specify that such surpluses be disposed of abroad so far as possible. In the disposition of such surpluses consideration should be given to the economic conditions in particular markets and to the interests and rights of American enterprise in the resumption and distribution through normal channels in the respective countries. Such surpluses disposed of abroad should be debarred from subsequent import into the United States. Very truly yours, T. W. HOWARD, Secretary, Surplus War Property Committee. SPECIAL COMMITTEE ON UTILIZATION OF WAR PLANTS AND SURPLUS PROPERTY OF THE CHAMBER OF COMMERCE OF THE UNITED STATES, WASHINGTON Mattei, Albert C., chairman and president, Honolulu Oil Corporation, San Francisco, Calif. Anderson, Hugo A., vice president, First National Bank of Chicago, Chicago, Ill. Brinker, P. M., president, Brinker Grocery, Dallas, Tex. Brooks, E. P., vice president, Sears, Roebuck Co., Chicago, Ill. Brown, Donaldson, vice chairman, General Motors Corporation, New York City. Carpenter, W. S. Jr., president, E. I. du Pont de Nemours & Co., Inc., Wilmington, Del. Clausen, Fred H., president, the Van Brunt Manufacturing Co., Horicon, Wis. Connolly, John L., secretary, Minnesota Mining & Manufacturing Co., St. Paul, Minn. Davis, Paul H., Paul H. Davis & Co., Chicago, Ill. Dulany, Ralph O., president, John H. Dulany & Son, Fruitland, Md. Healy, E. B., president, Sante Fe Book & Stationery Co., Sante Fe, N. Mex. Ladds, H. P., president, the National Screw & Manufacturing Co., Cleveland, Lanier, Monro B., president, Ingalls Shipbuilding Corporation, Birmingham, Murchison, Claudius T., president, Cotton Textile Institute, Inc., New York Whipple, C. J., president, Hibbard, Spencer, Bartlett & Co., Chicago, Ill. Williams, Roger, executive vice president, Newport News Shipbuilding & Dry STATEMENT OF THE AMERICAN FEDERATION OF LABOR RE H. R. 5125 (By William Green, president, American Federation of Labor, August 9, 1944) The American Federation of Labor is in complete agreement with the necessity for the establishment of some Federal authority to provide for the disposal of certain surplus Government property and plants in the post-war era, and with the general objectives, principles and procedures to accomplish this end set forth in the bill introduced by Representative Colmer in the House and Senator Johnson in the Senate. It is obvious that, with a possibility that billions of dollars' worth of governmental plant facilities, equipment and products will remain undisposed of at the end of the war, some means must be provided, through the Government, of making the necessary disposal of these properties. Such disposal must, of course, seek to obtain the highest possible return for the Government, the most effective use of plant facilities, and the advancement of our economy generally, but must avoid dislocations of established businesses and impairment of employment opportunities. On the one hand, the hasty or ill-considered flooding of the markets with surplus commodities could, and undoubtedly would, create serious employment dislocations, and, on the other hand, the use of existing government-owned plant facilities for the production of widely needed civilian goods can afford employment opportunities for the returned soldier and the displaced war worker. It cannot be denied that the distribution of surplus goods and the granting of the use of governmental plant facilities to private enterprise can and should be done only in the exercise of great care that the interests of all who might be affected thereby are protected the worker, in his employment opportunities; the businessman, in his ability to operate at a reasonable profit; the farmer, in making available to him agricultural implements, together with an adequate market for his produce; and finally the public, in that the entire domestic economy is maintained at a level which permits full production and use of plant facilities and_full employment opportunities, together with the highest possible return to the Government for the disposed of property. It is important, then, that extreme care and caution be utilized in the disposition of surplus materials, goods and plant facilities, and that in such disposition the interests of those directly affected by consulted. It is with this primary thought in mind that the American Federation of Labor suggests and urges that the function and duty of disposing of governmental surpluses be placed not in the hands of a single administrator, as the present bill proposes, but in the hands of a four-party Board, composed of representatives of business, labor, agriculture, and the public, headed by a chairman, who is to be selected from one of the public members. It would appear that in this way, and in this way only, could adequate protection be afforded to all interests that might be affected by the disposition of surplus materials, and that through such a Board alone could ways and means of disposing of such surplus commodities best be evolved. Aided by the benefit of the advice and counsel of representatives of those portions of society most directly affected by any given distribution of surplus goods, it can reasonably be assured that the distribution will be accomplished by methods most consistent with the public good and least disruptive of the over-all economy. Accordingly, the American Federation of Labor urges that the present bill be amended so as to remove the supervision and direction of the disposition of surplus property from the hands of a single administrator and place that supervision and direction in the hands of a Presidentially appointed board, consisting of representatives of the public, of industry, of agriculture, and of labor. In addition, the American Federation of Labor urges that the objectives of the bill as contained in section 1, and the policies governing disposition as contained in section 12, be further clarified and illuminated by the addition of a provision which will assure of an intention to foster and not to discourage or impair post-war employment opportunities in the disposition of surplus properties. Specifically, the American Federation of Labor suggests that section 3 (a) of the bill be amended to read as follows: "SEC. 3. (a) There is hereby established a Surplus Property Board, which shall be headed by a Chairman. The Board shall consist of eight members appointed by the President, by and with the consent of the Senate, who shall receive compensation at the rate of per year, and shall serve for a term of years. Two of such members shall be selected as representatives of the public, two from industry as representatives of industry, two from agriculture as representatives of agriculture, and two from labor as representatives of labor. Chairman shall be selected from the public members. A majority of the Board shall govern in the making of decisions and in carrying out the policies and purposes of the Act." The Subsection (j) of section 2 will be stricken, and in its place will appear the following: "(j). The term 'Board' means Surplus Property Board." Wherever the term "administrator" appears in the present act, it shall be stricken and in its place shall be substituted the term "Board", and in place of the |