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APPENDIX

(Telegrams addressed to Hon. William L. Dawson follow :) NINTH FEDERAL SAVINGS & LOAN ASSOCIATION OF NEW YORK CITY,

New York, N. Y., June 20, 1956. Hon. WILLIAM L. DAWSON, Chairman, House Committee on Government Operations,

House Office Building, Washington, D. C.: On behalf of 42,000 members, request you disapprove separation of Insurance Corporation from Federal Home Loan Bank Board proposed by Reorganization Plan No. 2. Plan would only create an unnecessary expensive new agency unduly complicating day-to-day operations of thousands of savings and loan associations throughout country to no ultimate advantage to public. Additional objection is our business was not even consulted and issues never debated on such major change. Your help is needed to defeat plan.

JULIAN R. FLEISCHMANN, President.

CENTRAL FEDERAL SAVINGS & LOAN ASSOCIATION OF NASSAU COUNTY,

Long Beach, N. Y., June 22, 1956. Hon. Congressman WILLIAM L. Dawson,

House Office Building, Washington, D. C.: I wish to express opposition to Reorganization Plan No. 2 of 1956 which proposes separate and independent status for the Federal Savings and Loan Insurance Corporation and the Home Loan Bank Board. This division will result in confusion between the two agencies when the present liaison status ends if this bill is passed.

Duplication in supervision of insured savings and loan associations can only result in conflicting ideas, purposes, and directives. Management of insured savings and loan associations will therefore be impaired due to the lack of agreement on policies proposed by two separate supervisory agencies.

VANCE CARNAHAN, Executive Secretary.

THE DALLES, OREG., June 23, 1956. Hon. WILLIAM L. DAWSON, Chairman, Subcommittee on Reorganization,

House of Representatives, Washington, D. C.: As the Oregon representative of the Savings and Loan Industry, I wish to register my opposition to reorganization plan No. 2, on basis no emergency exists, this actiton is hasty, and the problem, if any, should be carefully studied by constituted authorities concerned with savings and loan operation before taking action.

B. M. KEITH.

BUFFALO, N. Y., June 28, 1956. WILLIAM L. DAWSON, Chairman, House Committee on Government Operations,

House Office Building, Washington, D. C.: Our board of directors at a meeting June 25, 1956, expressed strong objections to the purpose and provisions reorganization plan No. 2 and respectfully ask your support in its defeat.

BLACKROCK RIVERSIDE SAVINGS & LOAN ASSOCIATION. 110

(Letters addressed to Hon. John W. McCormack follow :) BOSTON FEDERAL SAVINGS & LOAN ASSOCIATION,

Boston, Mass., June 20, 1956. Hon. JOHN W. McCORMACK,

House of Representatives, Washington, D.C. MY DEAR CONGRESSMAN : Some time in the near future the Committee on Government Operations will consider resolutions to disapprove Reorganization Plan No. 2. I wish to express our opposition to this plan, and I am urging you to support the action to defeat it.

Although Reorganization Plan No. 2 was a Presidential proposal, we feel that it was doubtful that the President was made aware of the implications of this proposal. We cannot find any evidence of advice having been sought from the organized savings and loan business, or any of the savings and loan supervisory officials.

Congress last year made the Bank Board independent. Any changes as suggested under Reorganization Plan No. 2 should have the full study of the supervisors of the saving and loan business, as well as the industry itself; and any suggested changes should be made only after the fullest study by Congress.

Reorganization Plan No. 2 creates another separate agency and the wisdom of tampering with this present successful single agency is highly questionable and dangerous. Unlike most reorganization plans proposed, this would not result in economy of operation but rather would increase the expense of the Government agencies to individual savings institutions. The existence of two boards with overlapping responsibilities for the savings and loan operation would result in conflicts of policy and great confusion in the business as well as to the Congress and to the President.

The Boston Federal Savings and Loan Association is interested in and will support any constructive improvement in the supervision of the savings and loan business. The United States Savings and Loan League currently is making a careful study of the Federal Home Loan Bank System with that end in view. Yours very truly,

EDMOND F. DAGNINO, President.

FIRST FEDERAL SAVINGS & LOAN ASSOCIATION OF LOWELL,

Lowell, Mass., June 19, 1956. Re Reorganization Plan No. 2 Representative John W. McCORMACK,

House Office Building, Washington, D. C. DEAR REPRESENTATIVE MCCORMACK: This association respectfully requests your support in opposition to the above re ganization plan. It is natural that the existence of two Boards, with overlapping responsibilities for a savings and loan operation, will result in a conflict of policy and general misunderstanding within the business as well as to both supervisory authorities, Congress and the President.

The creation of another agency will, of necessity, increase the cost of operations for savings and loan associations throughout the country as well as for the Government itself.

The creating of another Board with overlapping responsibilities for savings and loan operations will create controversies throughout all phases of the business to all who are involved. Many other vital points in opposition can be pointed out, but I am sure that in your studies of this particular reorganization plan, you will understand why we solicit your support in opposition to the same. Very truly yours,

STANLEY A. GIFFIN, President.

FOXBOROUGH CO-OPERATIVE,
FEDERAL SAVINGS & LOAN ASSOCIATION,

Foxboro, Mass., June 20, 1956.
Hon. JOHN W. McCORMACK,
House Committee on Government Operations,

House Office Building, Washington, D. C. DEAR CONGRESSMAN MCCORMACK: I am writing to register our opposition to Reorganization Plan No. 2, wherein it is proposed to divide the Federal Savings and Loan Insurance Corporation and the Federal Home Loan Bank Board into two separate agencies, and to ask that you support action to defeat it when it comes before your committee.

Our association is ready to support any means that may be devised to improve the supervision of the savings and loan business, but maintain the separation into two agencies is not essential to accomplish this end.

With only a few exceptions the savings and loan institutions, like ours, are in a strong position and are progressive, as signified by the percentage of home loans they have made. This has been accomplished through a single agency.

The creation of still another agency means extra expense of operation, conflict of policies, and confusion within the business. Yours truly,

HARRY P. BOYCE, President.

BAY RIDGE SAVINGS & LOAN ASSOCIATION,

Brooklyn, N. Y., June 20, 1956. Reference to Reorganization Plan No. 2. Hon. John W. McCORMACK, House of Representatives,

Washington, D. C. Sir: Your cooperation is respectfully requested in the defeat of Reorganization Plan No. 2 for the following reasons:

1. The probable necessity of filing separate reports to both the Federal Savings and Loan Insurance Corporation and the Home Loan Bank Board.

2. Submission of matters requiring approval of both agencies, first one and then the other.

3. Added examination costs.

4. Effect of reorganization plan will result in chaos through conflicting rules and regulations.

5. Expensive duplication of examinations.

6. The present single agency system to handle savings and loan affairs has been developed over a period of 25 years and has produced a strong and progressive nationwide system of savings institutions which now finance a substantial part of our Nations' homes.

7. We question the wisdom of tampering with the present single agency system as being questionable.

8. The proposed reorganization plan would not result in economy of operation and would increase the cost of operations to individual savings institutions.

9. Two boards with overlapping responsibilities for savings and loan operations might well result in conflicts of policy and added confusion.

10. We are ready to support any constructive improvement in supervision of the savings and loan business. The United States Savings and Loan League is currently making a careful study of the Federal Home Loan Bank System with that end in view.

May we count on your support in the defeat of the proposed Reorganization
Plan No. 2 about to be submitted to you?
Respectfully,

HENRY G. STEIN, President. (Statements, with attachments, received by the subcommittee follow :)

STATEMENT OF HON. THOMAS J. Dodd, A REPRESENTATIVE IN CONGRESS FROM THE

STATE OF CONNECTICUT

Mr. Chairman, and gentlemen of the subcommittee, I am glad of this opportunity to make my position on Reorganization Plan No. 2 a part of the record of these important hearings.

The basic purpose of this plan, submitted by the President on May 17, is to separate the Federal Savings and Loan Insurance Corporation from the jurisdiction of the Federal Home Loan Bank Board, and to create a new board for the Insurance Corporation, making no provision for bipartisan representation.

I am opposed to Reorganization Plan No. 2 because there is no need for the separation of the Federal Savings and Loan Insurance Corporation from the jurisdiction of the Federal Home Loan Bank Board. I am opposed to this reorganization plan because I think it is unnecessary and unwise.

The savings and loan business has approximately $40 billion in assets and is one of the most vital instruments in maintaining a stable economy. It is nationwide in scope, and its operations affect millions of Americans. I am convinced that any plan to make drastic changes in the administration of this important segment of our economy should receive the most critical scrutiny of the Congress. As I understand the practical effects of Reorganization Plan No. 2, it would divorce the Loan Insurance Corporation from the Home Loan Bank Board, and create an additional supervisory agency with the corollary of needless cost to the Government, the Federal Home Loan Bank Board, and numerous member institutions.

A number of leading members of the savings and loan business of my own State of Connecticut have stated that the implementation of this plan might be seriously detrimental to the economy of our country and could have an adverse effect upon the thousands of institutions insured under the Federal Savings and Loan Insurance Corporation.

It has been called to my attention that Reorganization Plan No. 2 was submitted without the prior knowledge of the leaders in the savings and home loan field, and that those who would be most directly concerned had no opportunity to register dissenting views. The Federal Savings and Loan Advisory Council, an organization created by Congress to meet with the Federal Home Loan Bank Board in an advisory capacity, has gone on record in opposition to the enactment of this plan. It is their view that the plan would not be beneficial to the millions of individuals who have savings accounts or mortgage loans with the various institutions.

The separation of the Federal Savings and Loan Insurance Corporation from the Board merely creates another independent agency reporting to the Congress and to the executive branch, even though the Federal Home Loan Bank Board was reestablished by Congress last year as the agency responsible for matters relative to the country's 4,200 thrift and home-financing institutions.

I have been given to understand that Reorganization Plan No. 2 was submitted without consideration by the Banking and Currency Committees of either body. In addition, the opinions of responsible leaders in this field were not solicited.

Also, it appears doubtful that any operating economies will be realized by the Government through the adoption of this plan. At the present time all expenses of both agencies are underwritten by member institutions—not by the Federal Government.

STATEMENT OF HON. HARRISON A. WILLIAMS, A REPRESENTATIVE IN CONGRESS

FROM THE STATE OF NEW JERSEY

Mr. Chairman, several constituents of mine who are officers of savings and loan associations have registered with me their opposition to Reorganization Plan No. 2. They point out that the plan would result in an overlapping of functions and confusion and duplication of effort in the supervision of member associations.

I would like to call to the attention of the committee the attached letters which seem to me to summarize very well pret ling objections to adoption of Reorganization Plan No. 2.

I appreciate this opportunity to make these views known to the committee.

NEW JERSEY SAVINGS & LOAN LEAGUE,

NEWARK, N. J., June 20, 1956. Re President's Reorganization Plan No. 2. Hon. HARRISON A. WILLIAMS, Jr. Member of Congress,

House Office Building, Washington, D. C. DEAR CONGRESIMAN WILLIAMS: The above proposed reorganization plan materially affects a large segment of our membership, and we would like to record our views with you concerning it. The plan was submitted to Congress on May 17. In the meantime, we have given it careful study and believe that it should be disapproved by Congress. We hope that when the matter comes before you that the action for disapproval will have your support.

The plan has the effect of separating the operations of the Federal Savings and Loan Insurance Corporation from the Federal Home Loan Bank Board.

It is our understanding that the basic purpose of the governmental reorganization program is to eliminate duplication of effort with resultant efficiency and economy of operation. Such plans usually involve the consolidation of the present separate activities.

The plan, however, does the reverse. It establishes two independent agencies in place of one. This means some overlapping of functions and confusion and duplication of effort in the supervision of the member associations of the Insurance Corporation. It also leads to the conclusion that the expense of supervision to the associations will be increased because of this duplication.

We know of no past or present situation that would require the adoption of this plan nor of any advantage that would result from its adoption. In fact, its submission came as an utter surprise to the people in the savings and loan business.

We understand that the plan may be disapproved in one of two ways: One is by the adoption of the housing bill of 1956 with the inclusion of an amendment adopted by the House Banking and Currency Committee which would have the effect of disapproving the plan; the other is by the adoption of a resolution of disapproval by either House by a constitutional majority vote of that House.

We hope that when the matter comes before you in either or both of the above forms, that we shall have your support of our position. We shall be glad to go into further detail as to the matter and furnish additional information if you so desire it. Sincerely yours,

EMIL A. GALLMAN, President.

PENN SAVINGS & LOAN ASSOCIATION,

Newark, N. J., June 20, 1956.

RESOLUTION

Whereas under date of May 17, 1956, President Eisenhower transmitted Reorganization Plan No. 2 to the Congress; and

Whereas the plan provides for the separation and a drastic change in the organization and operation of both the Federal Home Loan Bank Board; and

Whereas such separation of the agencies would result in increased cost, needless and conflicting duplication of supervision, and inject partisanship into a newly created independent agency: Now, therefore, be it

Resolved, That the officers and board of directors of the Penn Savings & Loan Association, of Newark, N. J., in regular meeting assembled strongly urges the rejection of Reorganization Plan No. 2; and be it further

Resolved, That a copy of this resolution be transmitted to the Members of Congress from this State.

I hereby certify that the above is a true copy of a resolution adopted June 12, 1956.

WILLIAM B. HELLER, Secretary.

STATEMENT OF Hon. HENDERSON LANHAM, A REPRESENTATIVE IN CONGRESS FROM

THE STATE OF GEORGIA

Mr. Chairman, I appreciate the opportunity of appearing before your committee in opposition to Reorganization Plan No. 2. Among the most pleasant and satisfying experiences of my 10 years in Congress was my association with the members of and my membership on this great committee. It is pleasant to renew the old .contacts and to present very briefly the reasons for my opposition to the reorganization plan you are considering.

You may recall, Mr. Chairman, that as a member of this committee, I voted to set up the first Hoover Commission and was quite enthusiastic about most of the recommendations made by that Commission and took an active part not only in the committee but on the floor of the House in getting adopted most of the reorganization plans based on the Hoover Commission recommendations. I was

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