Over 64 of the 7 billion dollars appropriated have now been allocated, upon the recommendation of these agencies, for specific materials and services. Their procurement machinery has been constantly at work, locating producers and placing contracts. Over 31⁄2 billion dollars of legal commitments have already been made. Contracts will soon be placed for the entire 7-billion-dollar appropriation.

Contracts have been placed and work has started on nearly a billion dollars of bombardment aircraft. New ways have been started and work is in progress for about one-half a billion dollars of new merchant shipping. New facilities to speed the production of guns, ammunition, and other defense articles have been started under contracts totaling about $262,000,000. Over $430,000,000 has been allocated, and over $250,000,000 has been obligated, for the purchase of milk, eggs, and other agricultural products.

Daily the aid being rendered is growing. Through the month of August the total dollar value of defense articles transferred and defense services rendered, plus expenditures for other lend-lease purposes, amounted to $486,721,838.

Food and steel and machinery and guns and planes have been supplied in increasing quantities. Agricultural commodities worth $110,606,550 have been transferred to the countries we are aiding. We have transferred to the United Kingdom more than 44 million pounds of cheese, more than 54 million pounds of eggs, more than 89 million pounds of cured pork, more than 110 million pounds of dried beans, and more than 114 million pounds of lard. We have transferred to them more than 3 million barrels of gasoline and oil. We have sent them many tanks. Merchant and naval ships and other transportation equipment are being transferred in growing amounts.

A substantial number of cargo ships and tankers have been chartered to the use of those countries whose defense is vital to our own. Our yards are repairing allied merchant ships. We are equipping allied ships to protect them from mines; and we are arming them, as much as possible, against aircraft, submarines, and raiders.

We have also, by repairing and outfitting their warships, helped the British and allied navies keep clear the vital sea lanes upon which depends continued resistance to Axis piracy. The repair of the battleship Malaya and the aircraft carrier Illustrious are outstanding examples of this naval assistance.

Across the

Over the whole range of technical and material assistance required by modern warfare we are, under the lend-lease program, rendering effective help. Important defense information is being supplied to Britain and the other nations fighting the Axis powers. Our technicians are instructing the Allies in the assembly operation and maintenance of the tools coming from our factories. United States and across Africa our plane ferry service is linking the arsenals of America with democracy's outposts in the Middle East. On our airfields thousands of British pilots are being and will continue to be trained and already we are preparing a similar program to help the Chinese.

We have supplied equipment for the Yunnan-Burma Railroad and for the Burma Road in order to speed the flow of arms and materials to the heroic Chinese people. In addition to materials of war we are furnishing China with medicine and technical assistance to fight the ravages of malaria. A military mission has also been dispatched to China in connection with the supplying of lend-lease aid.

The $7,000,000,000 appropriated for purchasing defense articles has been available less than 6 months and actual transfers from these funds have necessarily been limited to articles which could be purchased in a finished state or produced in that time. The speed with which future lend-lease transfers will be made depends largely on the speed with which our industries deliver the goods. The rate of our production must be accelerated and every step to achieve that end must and will be taken.

These lend-lease deliveries are not, of course, the only materials which have been moving from our shores to the countries resisting aggression. Prior to the LendLease Act, large contracts were placed here by Great Britain and by other countries from their own resources. Deliveries under these contracts are moving across the sea along with lend-lease articles. The true measure of the volume of war supplies moving from our shores is reflected in our total exports. Thus, since the beginning of the war, about $4,400,000,000 worth of goods have been exported to the British Empire.

Figures alone cannot show the significance of our help. Americans may be justly proud of the way in which the tools they have forged are standing up when tested under fire. An American-made flying-boat spotted the Bismarck and

American-made bombers blasted the Scharnhorst and the Gneisenau, and they have helped make possible the great raids of the R. A. F. in the Battle of Germany. In the wars of the western desert, fighter planes from our factories are in the vanguard of the attack and hundreds of our tanks stand ready to help rout the Nazi scourge from the African continent.

The British Empire has received the bulk of our aid. But we have also extended assistance to the many other countries engaged in the same struggle. China and the Dutch East Indies are receiving ever-increasing quantities of supplies. The exiled governments of the countries under the Nazi yoke are sharing in the program. We are already outfitting Polish troops who are training in Canada for action overseas. We are also providing, directly or indirectly, aid for the Dutch, the Norwegians, the Greeks, the Belgians, and the Yugoslavs. We know that every group which yields to or collaborates with the Nazis makes our own defense that much more difficult. Likewise each group that resists Nazi aggression helps to keep the war from our own hemisphere.

The defense of the Western Hemisphere has been a prime consideration in our lend-lease program. Not only are we helping the European countries which stand athwart the Nazi path toward the Western Hemisphere, but we are also giving direct lend-lease aid to the countries of this hemisphere. We are strengthening Iceland, where our troops and ships now stand guard over the approaches of the North Atlantic, and we have already embarked upon a comprehensive program of material aid to the countries of Central and South America to strengthen the common defense of our good neighborhood.

The gallant resistance of the Russian people has been of enormous help to all peoples resisting the Nazi war machine. It has completely upset the Nazi time schedule and has destroyed the myth of Nazi invincibility. We are using the energies of our Government to make available supplies which are urgently needed by Russia. By speeding deliveries and by arranging the quickest transportation of American materials, we are moving to strengthen the important Russian front. The Soviet Government's purchases here are being made with its own funds through its regular purchasing agency.

The people of the United States know that we cannot live in a world dominated by Hitlerism. They realize that there can be no real peace, no secure freedom until we have destroyed the evil forces which seek to work us woe. Through their chosen representatives, they have declared a firm and unalterable policy to. build up an impregnable defense for this hemisphere, and to furnish unstinted material aid to the countries fighting against Nazi aggression and tyranny.

We are not furnishing this aid as an act of charity or sympathy, but as a means of defending America. We offer it because we know that piecemeal resistance to aggression is doomed to failure; because the ruthless war machine which now bestrides the continent of Europe can be combatted only by the combined efforts. of all free peoples and at all strategic points where the aggressor may strike.

The lend-lease program is no mere side issue to our program of arming for defense. It is an integral part, a keystone, in our great national effort to preserve, our national security for generations to come, by crushing the disturbers of our peace.

To those peoples who are gallantly shedding their blood in the front lines of this struggle, we must offer not only a shield but a sword, not merely the means to permit the stalemate of protracted defense, but the tools of a final and total' victory.

This country has evolved the greatest and most efficient industrial system in history. It is our task to turn the workshops of our industry into mighty forges of war to outbuild the aggressors in every category of modern arms. Only in this way can we build the arsenal of democracy.

On this task we are now engaged with ever increasing vigor. Planes, tanks, guns, and ships have begun to flow from our factories and yards, and the flow will accelerate from day to day, until the stream becomes a river, and the river a torrent, engulfing this totalitarian tyranny which seeks to dominate the world. FRANKLIN D. ROOSEVELT.

THE WHITE HOUSE,

September 11, 1941.

THE WHITE HOUSE, Washington, September 18, 1941.

The SPEAKER OF THE HOUSE OF REPRESENTATIVES. SIR: I have transmitted to the Congress the Second Report of operations under the Lend-Lease Act. This report indicates the increasing amount of material aid we are rendering to the democracies. Of the $7,000,000,000 appropriated 6

months ago, aid in the amount of $6,280,000,000 is now moving through the successive stages of allocation, obligation, production, and delivery. Additional funds are now needed in order that there be no interruption in the flow of aid to those countries whose defense is vital to our own. I am, therefore, transmitting a supplemental estimate of appropriation in the amount of $5,985,000,000, the details of which are set forth in the accompanying letter from the Director of the Bureau of the Budget. I recommend its speedy enactment.

Respectfully,

The PRESIDENT,

The White House.

SIR: I have the honor to submit for your consideration a supplemental estimate of appropriation to carry out the provisions of the act entitled "An act to promote the defense of the United States," approved March 11, 1941, in the amount of $5,985,000,000, as follows:

"DEFENSE AID

"To enable the President, through such departments or agencies of the Government, as he may designate, further to carry out the provisions of an act to promote the defense of the United States, approved March 11, 1941, and for each and every purpose incident to or necessary therefor, there are hereby appropriated, out of any money in the Treasury not otherwise appropriated, in addition to the sums appropriated by the Defense Aid Supplemental Appropriation Act, 1941, the following sums for the following respective purposes, namely:

"(a) For the procurement, by manufacture or otherwise, of defense articles, information and services, for the government of any country whose defense the President deems vital to the defense of the United States, and the disposition thereof, including all necessary expenses in connection therewith, as follows:

"(1) Ordnance and ordnance stores, supplies, spare parts, and materials, including armor and ammunition and components thereof, $1,190,000,000.

"(2) Aircraft and aeronautical material, including engines, spare parts, and accessories, $685,000,000.

"(3) Tanks, armored cars, automobiles, trucks, and other automotive vehicles, spare parts, and accessories, $385,000,000.

"(4) Vessels, ships, boats, and other watercraft, including the hire or other temporary use thereof, and equipage, supplies, materials, spare parts, and accessories, $850,000,000.

"(5) Miscellaneous military and naval equipment, supplies, and materials, $155,000,000.

"(6) Facilities and equipment for the manufacture, production, or operation of defense articles and for otherwise carrying out the purposes of the act of March 11, 1941, including the acquisition of land, and the maintenance and operation of such facilities and equipment, $375,000,000.

"(7) Agricultural, industrial, and other commodities and articles, $1,875,000,000. "(b) For testing, inspecting, proving, repairing, outfitting, reconditioning, or otherwise placing in good working order any defense articles for the government of any country whose defense the President deems vital to the defense of the United States, including services and expenses in connection therewith, $175,000,000.

"(c) For necessary services and expenses for carrying out the purposes of the act of March 11, 1941, not specified or included in the foregoing, $285,000,000. "(d) For administrative expenses, $10,000,000.

"(e) In all, $5,985,000,000, to remain available until June 30, 1943.

"(f) Each of the foregoing appropriations shall be additional to, and consolidated with, the appropriation for the same purpose contained in sections 1 (a), 1 (b), 1 (d), and 1 (e), respectively, of the Defense Aid Supplemental Appropriation Act, 1941: Provided, That, with the exception of the appropriation for administrative expenses, not to exceed 20 per centum of any such consolidated appropriations may be transferred by the President to any other of such consolidated appropriations, but no such consolidated appropriation shall be increased more than 30 per centum thereby.

"SEC. 2. The President may, from time to time, when he deems it in the interest of national defense, authorize the head of any department or agency of the Government, to enter into contracts for the procurement of defense articles, information, or services for the government of any country whose defense the President deems vital to the defense of the United States, to the extent that such government agrees to pay the United States for such defense articles, information, or services prior to the receipt thereof and to make such payments from time to time as the President may require to protect the interests of the United States; and, upon payment of the full cost, the President may dispose of such articles, information, or services to such government.

"SEC. 3. Any defense article procured pursuant to this Act shall be retained by or transferred to and for the use of such department or agency of the United States as the President may determine, in lieu of being disposed of to a foreign government, whenever in the judgment of the President the defense of the United States will be best served thereby.

"SEC. 4. No part of any appropriation contained in this Act shall be used to pay the salary or wages of any person who advocates, or who is a member of an organization that advocates, the overthrow of the Government of the United States by force or violence: Provided, That for the purposes hereof an affidavit shall be considered prima facie evidence that the person making the affidavit does not advocate, and is not a member of an organization that advocates, the overthrow of the Government of the United States by force or violence: Prvoided further, That any person who advocates, or who is a member of an organization that advocates, the overthrow of the Government of the United States by force or violence and accepts employment the salary or wages for which are paid from any appropriation in this Act shall be guilty of a felony and, upon conviction, shall be fined not more than $1,000 or imprisoned for not more than one year, or both: Provided further, That the above penalty clause shall be in addition to, and not in substitution for, any other provisions of existing law.

"SEC. 5. This act may be cited as 'Title II of the Defense Aid Supplemental Appropriation Act, 1941.'"

I recommend that the estimate be transmitted to Congress.
Very respectfully,

HAROLD D. SMITH,
Director of the Bureau of the Budget.

PREPARED STATEMENT OF MAJ. GEN. JAMES H. BURNS, EXECUTIVE OFFICER, DIVISION OF DEFENSE AID REPORTS

The CHAIRMAN. We will include at this point a statement prepared by Maj. Gen. James H. Burns, executive officer of the Division of Defense Aid Reports. General Burns is not in the country at this time, but we have with us this morning a gentleman representing General Burns.

Mr. TABER. Mr. Chairman, I am not very keen about statements presented ex parte. I think the witnesses should present themselves for examination by members of the committee.

The CHAIRMAN. Each member of the committee has before him a copy of General Burns' statement, and without objection it will be included in the record.

Mr. TABER. I would also like to have the record show that I do not like the inclusion of ex parte statements without the witnesses being available for examination.

The CHAIRMAN. If the gentlemen objects, we will not include it in the record.

Mr. TABER. It is up to you. If you want to put it in the record, that is up to you. But I do not give any weight to statements presented in that way, myself, and I want the record to show that.

The CHAIRMAN. With the gentleman's objection noted, the statement will be included in the record at this point.

(The statement above referred to is as follows):

Hon. CLIFTON A. WOODRUM,
Acting Chairman, Deficiency Subcommittee,

SEPTEMBER 12, 1941.

Committee on Appropriations, House of Representatives.

DEAR MR. WOODRUM: In response to your request, and in view of the fact that I am leaving in the immediate future as a member of the President's War Supplies Mission to Russia, I am submitting the following statement with reference to lend-lease.

In asking Congress for additional funds and authority under lend-lease, it is realized your committee is entitled to a full accounting, subject to obvious restrictions as to secrecy, of our stewardship in the utilization of the funds and authority already granted, and is similarly entitled to a full justification of the additional needs submitted. This statement is directed, in only a general way, to

these two objectives.

In accordance with the Lend-Lease Act, a report on its operations must be submitted to Congress within every 90-day period. The second report, covering operations to September 1, 1941, has just been submitted. It covers these operations quite fully and I am sure the Division of Defense Aid Reports, which prepared it under the acting executive, Mr. Philip Young, will furnish you with such additional information as you request. I will not attempt to cover the whole field.

I have been associated with the lend-lease activities since the passage of the basic legislation on March 11, 1941, first, as a part of the War Department organization and, since May 6, 1941, the executive officer of the central lend-lease control organization known as the Division of Defense Aid Reports, in conformity with the Executive order of the President of May 2, 1941. In this position I have functioned under the President and his Lend-Lease Administrator who, until August 28, 1941, was Mr. Harry L. Hopkins and now is Mr. Edward R. Stettinius, Jr. Mr. Hopkins remains as special assistant to the President on lend-lease questions.

Prior to formalizing of the organization the central office was manned by Mr. Philip Young, Mr. Oscar Cox, Mr. James Buckley, Mr. Paul Banning, and a number of others who had been engaged on somewhat similar work in the Treasury Department. This group, under the general guidance of Mr. Hopkins and with the assistance of the Bureau of the Budget and other departments, laid the foundations of the procedure and policies which are now following. Fortunately nearly all of the original group still remain with the organization. Mr. Young is the deputy executive, Mr. Cox is the head of the legal staff, Mr. Buckley is Budget officer and special assistant. Mr. Banning, after establishing our accounting system on a very satisfactory basis, returned to the Treasury Department.

SCOPE OF LEND-LEASE ACTIVITIES

With the passage of the basic act of March 11, 1941, including its authority to transfer munitions to a value of $1,300,000,000, and the appropriation act of March 27, 1941, authorizing the expenditure of $7,000,000,000 for lend-lease purposes, a movement was started which is growing in importance and scope as time goes on. It is becoming worldwide in its effect and in its execution and ramifications. It is believed to be of importance to outline briefly the field covered. Lend-lease programs of aid include not only all types of munitions used by the fighting front such as ships, planes, tanks, guns, ammunition, trucks, food, clothing, shelter, fuel, etc.—but also all types of materials and services needed by the home front to assure production, delivery, supply, and effective utilization of these munitions, such as raw and intermediate materials, manufacturing and maintenance equipment and facilities, food, fertilizers, oil, office supplies, cargo vessels, tankers, railroad facilities, and equipment. In short, they include either directly or indirectly nearly everything produced on the farms, in the mines, and in the factories and shipyards just as does our own national-defense effort. Lend-lease now involves 12 foreign countries.

Lend-lease activities include the coordination of production, the storage and the delivery of goods and services to the various main theaters of action, including the British Isles, the Middle East and China, as well as to potential theaters, such as Iceland, the American republics, the Far East, etc.

Lend-lease is involved in the complications and ramifications of foreign trade and foreign exchange.