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PERCENT OF WORKERS EMPLOYED ON EACH SHIFT IN 602 DEFENSE PLANTS, MARCH 15, 1941
Senator DOWNEY. Mr. Secretary, would it not be your opinion that this very tabulation that you have presented would indicate a very great possibility of speeding up production by more fully utilizing existing machinery than by having fuller shifts?
Secretary PATTERSON. I would endorse everything that you say about that except the words “very great." I do not know to what extent we can improve things in that way. Considerably perhaps. We are not going to relax the chance of getting it.
Senator DownEY. Mr. Chairman, if I may intervene to say this. The CHAIRMAN. Yes.
Senator DowNEY. I hope you will not think that I am imposing too much on the time of the committee.
The CHAIRMAN. Not at all, Senator.
Senator DownEY. And I don't want to burden the witnesses or the committee, but to me, as I believe the chairman himself has said, this is possibly one of the most important questions before the Nation today.
Secretary PATTERSON. It is no burden to me, Senator, at all.
Senator DOWNEY. I know this: There are literally hundreds and thousands of workers and businessmen in California that are already almost hysterically alarmed over their future because of the prospective shutting off of the very materials that they are now using in their manufacturing establishments. And, as we step from the comparatively small present defense production to the magnitude that you are suggesting now, Mr. Secretary, it is going to produce catastrophic consequences upon hundreds of millions of workers and businessmen. That is the only reason that I am intruding to this extent.
The CHAIRMAN. You are not intruding, I assure you. Senator DOWNEY. Mr. Secretary, you stated that the second way in which the Government would endeavor to secure increased production would be by way of more fully utilizing subcontractors.
Secretary PATTERSON. Yes, sir.
Senator DOWNEY. And the 0. P. M. is already working on that phase of this development, as I understand.
Secretary PATTERSON. Yes, it is.
Now, you stated that the third method was by the Government's seeking to utilize to a greater extent the manufacturing tools already in the Nation.
Secretary PATTERSON. Yes, sir.
Senator DOWNEY. Now, Mr. Secretary, of course, the first and most obvious way to do that would be to spread out your production in contracts to a greater extent to those already engaged in business.
Secretary PATTERSON. Yes; I think that when I said the second method, subcontracting, I should have limited that to prime orders to industrial concerns not yet in possession of prime orders. Those are phases of the same thing.
Senator DOWNEY. That is right. Then your third classification would only include those cases in which the Government would actually commandeer existing machines in the hands of manufacturing corporations and place them elsewhere for the purpose of manufacture?
Secretary PATTERSON. Yes; by their voluntary purchase or requisition. That is right.
Senator DOWNEY. All right. Now that, Mr. Chairman, brings me back to seeking information that I wanted.
Exactly to what extent in my State of California would it be contemplated and necessary as seen through the eyes of the Army and Navy and Maritime Commission or the other Government agencies to actually go into existing manufacturing plants and take over their machinery? Have you any further information on that, Mr. Secretary?
Secretary PATTERSON. No; we have no program on that as related to southern California. None at all, Senator; and I think I told you that last week.
My own idea is that this act would rarely be availed of in any direct measures. It is one of those powers that will be of very great value to the Government in bringing about the availability of machines or raw materials. I do not think it would be exercised very commonly. I have not supposed at all that southern California was one of the regions where they had great collections of standard machine tools. It may be so. I don't know the distribution of those tools in the Nation. We have, I assure you, no definite designs upon that section.
Senator DOWNEY. Oh, I did not assume that, Mr. Secretary. I was merely inquiring about California because I knew something about that personally and, of course, wanted to do what I could to protect the businessmen of that State.
But for your own information, Mr. Secretary, let me say that I understand that in southern California we have about 400 manufacturing establishments; and that the chambers of commerce there count that the machinery in those manufacturing establishments is only being utilized to 50 percent of the capacity that it could be utilized.
Secretary PATTERSON. Of course, we have more defense orders in California now than in any other State except New Jersey.
Senator DOWNEY. Except Pennsylvania, you mean?
Secretary PATTERSON. I think New Jersey. That is due, of course, to the large aircraft plants that are located in southern California, and also shipbuilding. But shipbuilding is beyond my knowledge. But I would suppose that that region was already pretty well geared into the defense program.
Senator DOWNEY. Mr. Secretary, let me ask this: Are you able to present to the committee any concrete cases in which the exercise of the power granted under this bill is at the present time resulting—to your observation particularly-in the necessity of the Government agencies commandeering out of private establishments machines actually in use now in those private establishments for nondefense purposes?
Secretary PATTERSON. Senator, General Rutherford came along with me. He is the chief executive of the Under Secretary's office, and I asked him if he would be prepared to make a statement on that. I prefer that he do it if it is all the same to you. He knows more about it than I do.
The CHAIRMAN. Are there any questions that you want to ask the witness, Senator Hill? Senator Hill. No.
The CHAIRMAN. We will be very glad to hear from General Rutherford.
STATEMENT OF BRIG. GEN. H. K. RUTHERFORD, EXECUTIVE
OFFICER, OFFICE OF THE UNDER SECRETARY OF WAR General RUTHERFORD. Mr. Chairman, Secretary Patterson has outlined the origin of this bill and the fact that it is the third step in the program by which industry can be made to produce more rapidly. The first step, of course, is the adding of shifts in accordance with that chart which you have just had given to you. The second one is subcontracting. And the third, where neither of those measures are effective, and there is still additional capacity available, makes it possible for the defense agencies to obtain those facilities.
I have gone back in obtaining information as to where this bill might be actually applied, if enacted, to the World War situation. The situation is developing today almost exactly as it did at that time. I have some very specific examples of where it was used, and can carry that right on to the present and show where it would be used if we had the legislation today.
During the World War they used the general authority of the President to commandeer materials, machines, tools, and other items that were needed. I have a copy of an Army requisition form here that was used at that time. It begins with the words as follows:
By virtue of the authority vested in him by the Constitution and the laws of the United States the President of the United States, Commander in Chief of the Army and Navy, does hereby requisition for public use connected with the common defense the following necessary supplies:
That authority was considered by the Navy Department, and our legal advisers, as being perhaps too indefinite. I can quote from hearings before the select committee of the Sixty-sixth Congress in 1919, that was reviewing the subject. A question was asked of Colonel Disque, who was then in charge of the production of spruce lumber for airplanes. The discussion there was with respect to taking over a number of plants producing spruce; and Colonel Disque, head of the Spruce Production Division in the Aviation or Signal Corps, had asked this question of Mr. Magee, who was a member of the committee.
He asked Mr. Magee:
There was a great deal of doubt in the minds of the Judge Advocate General and the Secretary of War; and, if you wish, I will show that to the Committee, that it was absolutely impossible to do that at that time.
It was to give us definite authority to do and to explain what we are doing that we introduced this specific legislation that would cover the situation.
Senator DowNEY. Mr. Chairman, might I interpose one question just to clarify this in my mind?
The CHAIRMAN. Yes.
Senator Downey. General, before you go further, have you in mind and can you tell us about what was the monthly rate of production of war materials that we did obtain in 1918 or whenever the maximum was? I merely want something that will make it comparable with the present situation. What did we reach? Five hundred million a month or a billion or two billion? Have you any figures on that?
General RUTHERFORD. I do not, but I can get it and submit it to you.
Senator DOWNEY. I think that would be interesting, Mr. Chairman.
The CHAIRMAN. We would be very glad to get it.
Washington, D. C., June 28, 1941. Hon. ROVERT R. REYNOLDS, Chairman, Committee on Military Affairs,
- United States Senate. DEAR SENATOR REYNOLDS: At the hearing held by your committee on June 23, 1941, on S. 1579, a bill to authorize the President of the United States to requisition certain property for the use of or disposition by the United States, I was asked to furnish a statement showing the monthly rate of production of war materials in the United States during the World War, for comparison with our present production rate.
Attention is invited to the fact that when the United States entered the World War the transition from peacetime economy to emergency production was immediate, and the production of that 17-month period was accomplished under the impetus of the united effort of a Nation at war. During the past 12 months, however, the Nation has passed, in successive stages, from peacetime economy into a limited emergency, and then into a full emergency, without attaining the incentive of actual engagement in war. During a considerable part of this period it has been necessary to superimpose emergency production upon peacetime economy without dislocating the latter too seriously and utilizing peacetime methods to a considerable degree.
In spite of this situation, the rate of progress attained in the present emergency approximates very closely the rate reached during our maximum effort in 1918. Funds appropriated for our defense efforts in the World War and during the present emergency have followed much the same patterns both as to amounts and timing, and defense funds available in 1940-41 may fairly be compared directly month by month with similar funds available during 1917–18. Furthermore, actual withdrawal of funds for the armed services during 1940–41 have grown cumulatively very closely at the same rate as they did in 1917–18.
In 1918 the maximum rate of expenditure by the armed services occurred in November, when it totalled about one and one-half billion dollars.
It will be apparent, therefore, that during the present emergency we have already achieved in time of peace substantially the same rate of progress in the defense program as that attained during the World War when, in some respects, conditions were considerably more favorable. Sincerely yours,
H. K. RUTHERFORD,
Executive. General RUTHERFORD. Now as to the extent to which that authority was used in the World War: I went through the records and this is the gist of what I found. I took it not from an official publication, but from semiofficial publications that we have used for many years as being accurate representations of what went on during that period.
I quote from one report. This is from Industrial America in the World War, by Mr. Clarkson.
Commandeering was actually resorted to by the Army and Navy in many cases. The Army alone issued 510 requisitions for goods and 996 compulsory orders for production of goods.
Now, when we consider the hundreds of thousands of contracts that were placed, these are very minor quantities compared to the total. So that Judge Patterson's estimate that it was used very little or would be used very little, I think, is entirely correct.
The committee has asked for some specific examples as to where this requisitioning authority might be used.
If we take up the subject of its use in connection with patents or patent rights, and in view of the statement of Mr. Shea, the Assistant Attorney General, before the Patents Committee of the House of Representatives, when they were discussing H. R. 3360—and I have marked a number of instances in here where this requisition authority