Now, one of the policies is to encourage mutually beneficial trade relations with foreign nations, to develop foreign markets, and one of the means of doing that is to sell property, maybe at a loss, in order to get it before the people. Would you feel under those circumstances that (f) controlled the price on (h) to such an extent that you could practically give it away because it might be an encouragement to the ncrease of trade relations?

Mr. CLAYTON. I not only would not feel, speaking for myself, that we could give it away

Mr. WOLVERTON. When I said "give it away," I was speaking in the strongest terms possible. I meant to make a price that was so low that, in effect, it would be that.

Mr. CLAYTON. I would not feel I was authorized, or certainly would not feel inclined, to sell abroad at any substantial discount over what we could get for it in this country.

Mr. WOLVERTON. On the theory, even, if you felt that to do so would promote trade relations with a foreign nation?

Mr. CLAYTON. No, sir; I would not. I think they are relative expressions. I mean I do not think it means that the administrator is supposed to give away

Mr. WOLVERTON. I am not saying you should not do it; I am just asking the meaning of it.

Mr. CLAYTON. Yes, sir; I understand the nature of your questions.. But I feel any administrator would interpret that to mean, other things being equal, that he was to take that into account; but that he certainly would not be justified in giving away any of the Government's money or property for that purpose.

The CHAIRMAN. Really we could strike it out, couldn't we?

Mr. WOLVERTON. Well, we will need foreign trade to take care of our national income; so I guess you would not be losing much if you took a trade view of it.

The CHAIRMAN. It would be all right to strike it out, would it not, Mr. Clayton?

Mr. CLAYTON. I would not like to see it stricken out, Mr. Chairman. I think it is a good thing to have in there and keep in mind; but I do not think we need fear any improper use of it, or any undue emphasis being placed upon it.

The CHAIRMAN. Well, some of our people are becoming a little suspicious; after seeing that the only use ever made of the antistrike bill was to try to implement the orders of the F. E. P. C., they are getting a little suspicious.

Mr. WHITTINGTON. I agree with Mr. Clayton there, but it strikes me when you say "mutual"-to incur mutual benefits that means benefits to both sides our side, their side, here and there. That word "mutual" there saves the situation, as I see it.

Mr. COLMER. Mr. Chairman, Mr. Folsom of our committee, I think, had a question he wanted to ask.

Mr. FOLSOM. There were several people made the suggestion to our committee that there should be a provision in this bill for establishing advisory committees on which small business would be adequately represented as well as the retailers, wholesalers and manufacturers. I understand you have such committees now and I wonder if it would not be a good thing to incorporate that in the bill..

Mr. CLAYTON. We felt the use of industry advisory committees was so obviously the thing to do in this problem that it was not necessary to incorporate a provision to that effect in this bill, and I still feel that way. As a matter of fact, those industry advisory committees are availed of by the disposal agencies and not by the Surplus War Property Administration. They have some 700 of those industry advisory committees over at W. P. B. and, sooner or later, I expect a great many of those committees will have to be called upon for technical help and advice in the disposal problems. But we have felt that the disposal agencies were the ones to confer with them and work with them, rather than the Surplus War Property Administration. As I have said before, we have a very small staff. We have less than 50 people working for us now, counting all of the clerical help, and we want to keep the organization compact and small.

Mr. FOLSOM. I had in mind the suggestion that the disposal agency should have an advisory committee, and two or three of the bills introduced have such a provision in them.

Mr. CLAYTON. I do not see any objection to it, but the language would have to be drawn very carefully so as not to give the industry advisory commitees any veto powers. Also, I would think it would have to be drawn in such a way that the disposal agency was not compelled to consult them in every case before they could sell some property. For that reason, I think it is better to leave it out of the bill; but I do not object to it seriously.

The CHAIRMAN. Mr. Clayton, we are sorry we have kept you here all day, but I think your testimony has been very informative and helpful to the committee. Unless there are further questions

Mr. WHITTINGTON. Mr. Chairman, I would like to say this: I asked him about separating ordinary administrative Government and other property from war surpluses and, personally, I think that is the proper way to handle it. But we face a condition here rather than an ideal situation. It is most regrettable and I say that without criticism of the Senate that the House has made provision here for the disposal of ordinary surpluses and we did not make provision for the disposal of war surpluses. We want to study that.

This bill we have passed, as you have indicated, covers not only administrative properties, but covers both war and peace surpluses intended for the prosecution of the war. That bill should have been passed a year ago, and while we can criticize the Executive for a number of Executive orders and executive agencies, since February of this year we would have been without authority to dispose of muchproperty, except for the Executive order that combines the disposal of ordinary surpluses with war surpluses. And the only justification, Mr. Chairman, in my view, for embracing the disposal of both classes of property is the House has done its best and passed a provision for the disposal of it, and it is lamentable that it has not passed the Senate. And if they want to strike it out after it gets over there, I would not have any objection, but I still think this is a better device to handle it. We have done that and have passed a bill and it might be there would be some improvements if the same thing was passed again. Personally, I would like to see it divided normal or war surpluses; but, as I say, by including it, but, I personally am not making any objection to the pending bill at this time.

I assume we will have a suggestion from the Director of the Budget in a day or two, before we report the bill. I wanted to make this statement.

Mr. ZIMMERMAN. Mr. Chairman, I would like to make a statement as a member of the Post-war Planning Committee. I just want to express my personal appreciation for this invitation to appear with members of the Expenditures Committee of the House, and I also wish to express my appreciation for the very clear and comprehensive statement made about this bill by Mr. Clayton.

Mr. COLMER. Mr. Chairman, I wanted to say something myself along that line. I wish now to say that I concur in what my colleague, Mr. Zimmerman, has said. And, in saying that, I would also like to say that while it is true there has been no legislation enacted by the Congress on the subject, I am of the opinion that, as a result of the experience that Mr. Clayton has had in his capacity as Administrator, we have and will have a much better bill, or have a much better law, than we would have had if we had legislated without the benefit of that experience. So I am not so sure we have lost anything, in the long run.

And I hope, Mr. Clayton, this will be the last time you will have to appear before any of these committees and that we can get some legislation enacted and let you go ahead and perform the duties of your office.

Mr. WHITTINGTON. Before Mr. Clayton leaves-and I will not tell him "good-bye", because personally I enjoy having him as a witness down here on a matter as important as this-I would like to have his general counsel give us the language for an amendment to section 7 and have it presented before we report the bill.

The CHAIRMAN. He is going to present that to the committee when we get ready to report the bill.

Mr. WHITTINGTON. I would like to have him give us the exact language. I think we would like to have that.

Mr. CLAYTON. I thank you very much, Mr. Chairman, you and the other gentlemen, for your kind expressions and your patience in listening to me.

I would just like to say one thing for the record in reference to the last point Mr. Folsom brought up about the use of industrial advisory committees. I think, if anything is incorporated in the bill on that subject, provision ought to be made for exempting the activities of such committees and persons serving on them from action under the Sherman antitrust law; because I understand they have a great deal of concern, in acting under a statute of that kind, about that matter. I would think the bill ought to provide for an exemption from the Sherman antitrust law in such activities.

The CHAIRMAN. We will work that out.

(After informal discussion, the committee adjourned until tomorrow, Wednesday, August 9, 1944, at 10 o'clock a. m.).

SURPLUS PROPERTY ACT OF 1944

WEDNESDAY, AUGUST 9, 1944

HOUSE OF REPRESENTATIVES COMMITTEE ON

EXPENDITURES IN THE EXECUTIVE DEPARTMENTS,

Washington, D. C.

The committee met at 10 a. m., Hon. Carter Manasco (chairman) presiding.

The CHAIRMAN. The committee will be in order. We have with us this morning Secretary Wickard who desires to make a statement to the committee. We shall be glad to hear you at this time, Mr. Secretary.

STATEMENT OF HON. CLAUDE R. WICKARD, SECRETARY OF AGRICULTURE

Secretary WICKARD. Mr. Chairman and gentlemen of the committee:

First of all I want to make it clear that my remarks on disposition of surplus war property will concern only Government-owned land, facilities, equipment, machinery, and materials which properly can be used for agricultural purposes. The War Food Administration will testify concerning the disposition of food and other agricultural products.

1 think H. R. 5125 is in essence a good bill and should become law. In my opinion the outstanding merit of the bill is that the objectives as stated in the bill reflect the idea that the disposal of surplus Government-owned war property is not to be a mere liquidation but to be an operation in the long-time interest of the whole Nation. In order that these objectives may be attained, I would like to see the bill more explicit in its authorizations and directives to the Surplus Property Administrator. I believe the suggestions I shall make are in conformity with the policies and procedures which have been established by Congress in previous legislation.

Land: A great variety of land, ranging all the way from submarginal areas to some of our very best farm land, was acquired for various war purposes. When an area is declared surplus, a determination should be made immediately as to which parts are agricultural land.

The agricultural land which was owned by Government agencies before its utilization for war purposes should be returned to such agencies.

The remaining agricultural land should then be surveyed by agricultural technicians to determine its proper use on a long-term basis.

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Submarginal land should be assigned to the proper State or Federal Government agency depending upon location and the use to which it might be put. For example, some of the land might be included in soil-conservation, erosion-control, and forestry programs of the Department of Agriculture or of appropriate programs of the Department of the Interior.

Such disposition of submarginal land not only would be wise from the standpoint of good land use, but would be economical in the long run even though the land might be sold for a few dollars per acre. This is true because it is very probable that sooner or later submarginal land which goes into private ownership will have to be taken over by public agencies at a time when its restoration or reforestation will be more difficult and costly.

The land which is determined to be suitable for ranching or farming should be divided into family-sized units by persons experienced in such matters. It should be offered for sale only to those who do not now own a family-sized farm and who intend to live on the unit and operate it for a livelihood. No family should be permitted to buy more than one unit.

Subject to the conditions above mentioned, first preference should be given former owners and second preference to war veterans. The disposition of these units should be in accordance with the principles of the farm-tenancy program authorized by the Bankhead-Jones Act.

It would be inconsistent with sound public policy to permit this land to fall into the hands of those who do not need it for homes and a living when so many former owners and servicemen will find it impossible to get a farm at reasonable prices and terms.

This land should be sold on the basis of long-time earning capacity, taking into account the damage to the land, and to the buildings, fences and other permanent improvements. From a strictly dollarsand-cents standpoint, I do not believe that the Government would gain by selling this land at the inflated values which current market prices reflect. Because of the Government's obligations to veterans to see that they have an opportunity to make a good living, any apparent gain from sale of farm land at high prices would be much more than offset by more costly and perhaps less effective methods of helping war veterans get back on their feet. Further, should the Government, by act and by example, accelerate the vicious land boom now getting under way, the Nation will have that much greater outlay when it attempts to restore the financial foundations of rural America, as it had to do after the land boom of the last war.

It is my earnest hope that Congress will make sure that the good farm land to be released by the Government is used for encouraging the family-sized, family-operated farm ideal of America, which has been the foundation rock not only of our agriculture but our entire Nation. Plant facilities: A wide range of plant facilities have been constructed for war purposes, the disposition of which are of direct concern to agriculture. These plants range all the way from food and fiber processing and storage facilities to war plants which could profitably be converted to agricultural uses.

Wartime food processing facilities owned or financed by the Government include dried milk plants, concentrated citrus juice plants, dehydrated vegetable plants, and dehydrated raisin plants. Falling in a related category are the grain alcohol facilities now operating at