The CHAIRMAN. Senator Downey, have you any questions? Senator DOWNEY. Mr. Chairman, just one or two comments might be in order here.

I want to say, Judge Patterson, that this change does not really meet the difficulty that was in my mind, because I do not fear that the Government agencies are going to interpret and act upon this law in any unreasonable way, or that they would try to take the watch out of a man's pocket or seize his bank account or something of that kind. I assumed that our Government authorities would act reasonably from their viewpoint under the terms of the bill. So this change does not meet the difficulty that I had in mind.

Secretary PATTERSON. The change does not meet the point that you made, Senator, about small machine shops. At least, the text of it does not alter the situation in that regard.

Senator DOWNEY. Judge Patterson, of course, this goes into a very much larger issue; and we might as well fact it. If we are going to begin to produce within 6 months or a year two or three billion dollars worth a month of military equipment and we are going to give priority to materials and machinery for that as against the present producers for civilian purposes, we are going to produce a dislocation in this nation among the existing businesses and workers that will just be tremendous. That is what my mind has turned to-to what extent concretely the power given the Government in this bill will result in the disruption and dislocation of present business.

SECRETARY PATTERSON. I don't minimize the prospect of a general dislocation, Senator. Irrespective of the fate of this measure, we are going to have some very acute problems later on to deal with. I think, however, that the country is committed to do everything in its power to bring about the defeat of Hitler; everything in its power to bring about that object. That being the case, it seems to me that we cannot continue the business-as-usual theory or the practice of superimposing the defense load upon the normal civilian business of the country.

I think that to some extent, and to some degree, and I hope it may be as mild as possible, the substitution of defense business for civilian business must be brought about.

This measure, the priority power, the priority bill, means that. It does not mean anything else. The sending of an army of 1,400,000 men into training camps in the field means that. It does not mean anything else.

This measure is in perfect harmony with those bills. The immense appropriations that have been made very liberally by Congress for the military and naval defense of the country mean that. They do not mean anything else. We have piled up an enormous burden on the country.

I do not minimize that at all. And yet I am quite sure that this is the present pressing problem, which, as I see it, and the Congress and the President and the country at large see it, is the defeat of power the like of which the world has not seen in a long, long time. And I think that we must gear up our industrial machinery and our manpower to bring about that end.

Senator DOWNEY. Mr. Chairman, I have no disposition to argue this matter out here in the hearing, and I do not mean to do that.

But I am interested in securing the reaction of the witness here. So, if I may make some further comments.

The CHAIRMAN. We will be very glad for you to do so, Senator Downey.

Senator DOWNEY. Mr. Secretary, you have stated that there are three ways in which the Government is planning on bringing about increased defense production. The first one that you suggested was by utilizing the present machinery and equipment a greater proportion of the time than it is now being utilized.

Do you yourself have figures in mind or here by which you can show the extent to which present machinery is being used on an hourly basis per day and the extent to which you believe it could be reasonably used?

Secretary PATTERSON. I have here a tabular statement, Senator, prepared by the statistics branch of my office, which shows the number of shifts according to items of production. Of course, the first shift is the biggest shift; and then there is a small second shift and then quite a small third shift.

I do not mean, of course, to suggest that in every case you could have a perfect division between the first, second, and third shifts. You cannot. The effective use of machinery would not permit it.

But we are making greater efforts already to try to get more manhours onto the machines that are already geared into the defense effort. That was the first factor that I have mentioned here, and the one that you just inquired about.

Senator DoWNEY. Yes.

But that table that you present, if I read it correctly, shows that there is an almost negligible amount of employment in the third shift. Is that so?

Secretary PATTERSON. In some industries it is almost negligible. Senator DowNEY. Is there any industry in which it is not?

Secretary PATTERSON. I think the top one shows up substantially on the third shift.

Senator DowNEY. What does it show as compared to the first and second shifts?

Secretary PATTERSON. Of course, in many cases the contractors say and it is undoubtedly true, because we have investigated itthat shortage of skilled labor requires them to confine their efforts to two shifts of, say, 10 hours each, rather than three shifts of 8 hours each, because they say that they cannot get the skilled workers to operate the third shift.

Senator DOWNEY. Then, Mr. Secretary, to that extent, of course, your bottleneck is in your mechanics and not in your machinery? Secretary PATTERSON. In some cases.

Senator DOWNEY. I mean, in the ones that you have just mentioned.

Secretary PATTERSON. In some cases that is true.

Senator DOWNEY. Mr. Chairman, I would suggest that this tabulation ought to be placed in the record.

The CHAIRMAN. If there is no objection, it will be printed in the record at this point.

(The tabulation referred to is as follows:)

PERCENT OF WORKERS EMPLOYED ON EACH SHIFT IN 602 DEFENSE PLANTS, MARCH 15, 1941 Source of Information: Bureau of Labor Statistics

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 O. P. M. is already working on that phase of this development, as I understand.

Secretary PATTERSON. Yes, it is.

Senator DOWNEY. Mr. Mehornay testified here on that.

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