Mr. SNYDER. Inquiries come to me concerning the stock pile of rubber that has been there for 21⁄2 years. Mr. KRUG. We had to stock-pile that rubber for reclaiming, because, if we did not, we would not have had the rubber available. Mr. SNYDER. I can understand that. Mr. KRUG. In many parts of the country we have stock piles of that rubber, holding it in readiness for reclaiming, and we have had to stock-pile some in excess of immediate demands. As a matter of fact, one factor affecting this has been the crude rubber supply in the Far East. TRAILERS Mr. SNYDER. Do you have anything to do with trailers? Mr. KRUG. For civilians? Mr. SNYDER. Well, no; trailers as requested by one of the groups that appeared before the committee. Mr. CANNON. War housing? Mr. SNYDER. War housing, that wanted trailers, and I have seen hundreds of trailers, within the last few weeks, between my home and Pittsburgh, that have been standing there for 6 months or a year or a year and a half, good trailers, that have never been used. Mr. KRUG. I think the N. H. A. would like to know about them. Mr. SNYDER. They do know about them. Mr. KRUG. There has been a constant demand for trailers for use at war plants, that have been expanding. Mr. TABER. You do not expect them to bother about trailers, so long as you are giving them more money to build houses. METHOD OF RELEASING CONTROLS Mr. SNYDER. Oh, that is the way it is? Now my final question is this: You said that you had cut off controls of about 320? Mr. KRUG. We expect to drop about 100 orders as soon as possible. All of them have not as yet passed through the revocation process. Mr. SNYDER. Do you notify business as a whole every time you drop a control? Mr. KRUG. Yes, it is published in the Federal Register and is carried in a press release as an official announcement. Mr. SNYDER. That reaches the big fellow but the little fellow, interested in getting some of the equipment for his firm or perhaps to do a ttle business, does not get the information until the big fellow has gobbled up all the supplies, surplus supplies? Mr. KRUG. I think you would be surprised how speedily the inforation gets out to everyone. We have over 100 field offices and as on as we drop an order they know about it and they get a notice it to the local papers and the trade papers. As a matter of fact, I ave not found much complaint that the small fellow did not know about it in time to put in an order. RECONVERSION AND UNEMPLOYMENT Mr. O'NEAL. Mr. Krug, in considering the reconversion plans, do take into consideration the geographical location of labor or some ther situations so that when contracts are canceled they do not create greater unemployment? Are things of that kind taken into consideration? Mr. KRUG. This is the way it is handled. Realizing the difficulties of the problem, Justice Byrnes, when he was Director of War Mobilization and Reconversion, held hearings over long periods of months, to devise the best way to handle it. His directive took into account the factors that you have mentioned. He set up by directive a committee in the War Production Board, which has on it a representative from the Army, the Navy, the Air Force, the Maritime Commission, and the War Manpower Commission. That committee looks into all the major cut-backs and tries to determine the most feasible way of balancing them as against the various important elements in the economy. I think I mentioned before that we think their determination will prove helpful. Mr. O'NEAL. Does that cover all forms of Government contracts or just a certain number of the larger ones? Mr. KRUG. It covers cut-backs of military end items of over $500,000 per month. The smaller ones are handled directly by the procurement agency guided by the criteria that Justice Byrnes set up. Mr. O'NEAL. How could you expect to meet that situation, from the national standpoint, just through some general directive? Would there not have to be some engineering study made in order to get a picture of just how many contracts are going to be canceled, where you are going to expand operations? In other words, would you not have to approach it in a scientific way? Mr. KRUG. The Army and Navy have their men engaged in doing just that, and they have tried hard to do a good job. (Off the record discussion.) Mr. O'NEAL. What machinery have you for the public to be heard covering individual problems? For instance, suppose a small business fellow wants to go into a certain line of business, is there a place where he can go and get advice as to possibly being ready to go when he is permitted to do so? Mr. KRUG. We have over 100 field offices that have been set up just for that type of fellow. In the early days we tried to handle that direct from Washington. It was soon found to be impossible and very burdensome upon the small fellow. I think the district and regional offices have been doing a pretty good job in presenting information to the small fellow, letting him know what he is going to get and giving him information about the matters in which he is interested. There is one thing that I should mention and that is the task of getting accurate information out to a country as big as ours. It is a tremendous job. CONTROL OVER AIRPLANE INDUSTRY Mr. WOODRUM. Would you care to say something even on or off the record about the situation in the airplane industry? Mr. KRUG. I would prefer to discuss it off the record. (Off the record discussion.) Mr. TABER. Have there been, in connection with the aircraft industry, any substantial priorities granted to these big eir lines for new plenes for passengers? Mr. KRUG. Not heretofore. The Army and Navy had felt they needed the capacity. The Army transportation service has been very effective in handling the military operations in Europe and in the Pacific. Sometime ago there was some plan to use the two-engine airplanes that were used before the war. But they are very happy to be able to use the four-engine job, and they think it is going to be far more economical than the two-engine plane. The permission that was given the aircraft industry to produce commercial models, after they had met the military requirements, calls for the production of some commercial planes early in 1946. But all of the productive capacity of the industry for the rest of this year in that type is definitely tied up at the present time for very urgent military and naval requirements. EXPERIMENTAL DEVELOPMENT IN COMMERCIAL AIRPLANE INDUSTRY Mr. TABER. I was wondering why they had not been given some experimental development at least. Mr. KRUG. The aircraft companies? Mr. TABER. Yes. Mr. KRUG. They have been. Almost every one has a plane either in development or in actual production that it looks to as its commercial model. The Lockheed, Douglas Co., Consolidated, Boeing, and all of them, have what they are looking to as their production type, which they expect to sell commercially as soon as production is no longer needed by the Army and the Navy. CONTROLS OVER PRODUCTION OF FARM MACHINERY Mr. TABER. Have you done anything yet about farm machinery; have you loosened that up a little more? Mr. KRUG. This is the picture on farm machinery: Today the production has been complicated because of the military demand for castings and, in some areas, competition with the military for labor. I think adjustments are now being made in the tank program and in the military truck program, for instance, which will partially meet the demands for castings. That should be promptly ironed out. However, it will take time, several months, to build farm machinery production up to what we have already authorized. They have made about 75 percent of the authorized production, but competition with the Army for castings and with the general military plans for labor have cut their production. I do not think they will be able to get anything until late summer. Mr. TABER. That will not give them any relief in production for this year. Mr. KRUG. I think it may give them some harvesting machinery, but I do not think it will give any help, insofar as machinery needs are concerned, for planting new crops, before the next planting season. Mr. TABER. Harvesting machinery will include corn pickers; they will be able to get some of them? Mr. KRUG. Harvesting machinery will be coming on by the end of the year. Mr. TABER. Like grain and the spring wheat crop? EXPENDITURES DURING 1945 Mr. WIGGLESWORTH. Mr. Krug, as I undersatnd it, your overtime for this year ran $7,000,000, and you figure on an unexpended balance of about $1,000,000 for the year? Mr. CAWLEY. Mr. Wigglesworth, we have a more current estimate of savings at this time. We believe we will be able to accrue an additional $4,352,000 making a total estimated savings of $5,352,000 for fiscal year 1945. Mr. WIGGLESWORTH. If we add that to the $7,000,000 of overtime, for purposes of comparison, your actual expenditure will be something over $55,000,000, ex-overtime, for the current year? Mr. CAWLEY. That is correct, sir. It is estimated that our overtime, or some substitute for that, would approximate roughly $6.000,000 next year, but no provision is made for that in the 1946 appropriation. Mr. TABER. How much has your department spent already this year? Mr. CAWLEY. Of our total appropriation? Mr. TABER. Yes. Mr. CAWLEY. Approximately $47,000,000 up to March 31. Mr. TABER. To March 31? Mr. CAWLEY. Yes, sir. That is the first three quarters of the current fiscal year. Mr. TABER. And you are planning to spend $15,000,000 in the last quarter? Mr. CAWLEY. Yes, sir. I have a schedule of that, sir, showing the estimated savings, revised in the last week or so. I will be glad to supply it for the record. You will note our 1945 estimates include overtime payments. (The information requested is as follows:) |